The Osterweis Fund
Annual Report
March 31, 1996
<PAGE>
April 29, 1996
Dear Shareholders:
We are pleased to report that The Osterweis Fund had strong absolute
results in the quarter and fiscal year ended March 31, 1996, 4.5% and 15.6%,
respectively. Due to the somewhat defensive structure of our portfolio, our
performance trailed that of the S&P 500 for the same periods. Since the end of
the quarter, however, the Fund has continued to perform quite well and, as of
today, has a net asset value of $12.04 per share. Total performance for the
calendar year to date is now plus 7.1%, comparable to that of the S&P 500.
The first quarter of 1996 experienced an unusual divergence between the
bond market and the stock market. Long term bonds had a negative 5% - 7% total
return, while equities rose more than 5%. The bonds were hurt by sharp increases
in oil and grain prices which conjured up old inflation fears, and by Congress'
failure to pass a balanced budget.
If current inflation worries prove overdone, the bond market could
rally and help propel the stock market higher. On the other hand, if inflation
is about to ratchet higher and bonds weaken further, the stock market, which is
far from cheap, could be vulnerable. We are, therefore, keeping some powder dry
in the form of cash reserves and are focusing our stock selection on companies
with improving company specific fundamentals. Several of the companies in our
portfolio are actively restructuring and many others are aggressively
repurchasing stock. While the market as a whole is richly valued and some
sectors priced very speculatively, we continue to find individual situations
that are reasonably priced, particularly in relation to their improving
outlooks.
Sincerely,
/s/
John S. Osterweis
The Osterweis Fund's annualized total return from its inception on October 1,
1993 through March 31, 1996 was 8.93%. The twelve months ending March 31, 1996
showed a total return of 15.59%. Results shown are past performance, which
should not be regarded as an indicator of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their cost. The Osterweis Fund is distributed by
First Fund Distributors, Inc., Phoenix, AZ 85018.
<PAGE>
COMPARISON OF $10,000 INVESTMENT IN THE OSTERWEIS FUND AND THE S&P 500 INDEX
Annual Average Total Return
Periods Ended Marchg 31,1996
1 Year Inception(10/1/93)
15.59% 8.93%
<TABLE>
Date Osterweis Fund S&P 500
<C> <C> <C>
9/30/93 10,000 10,000
3/31/94 10,304 9,841
9/30/94 10,761 10,368
3/31/95 10,707 11,376
9/30/95 12,106 13,448
3/31/96 12,376 15,021
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
The Osterweis Fund
PORTFOLIO OF INVESTMENTS at March 31, 1996
- ------------------------------------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS: 80.4% Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Banks: 2.9%
<S> <C> <C>
9,400 Bank of New York Company, Inc........................................... $ 484,100
---------
Beverages - Alcoholic: 2.0%
5,000 Anheuser-Busch, Inc..................................................... 336,875
-------
Business Services: 10.7%
21,500 Allied Capital Corporation.............................................. 387,000
4,600 Dun & Bradstreet Corporation............................................ 278,875
58,400 National Education Corporation.......................................... 686,200
24,400 World Color Press, Inc.................................................. 463,600
-------
1,815,675
---------
Chemicals: 2.7%
17,000 Dexter Corporation...................................................... 450,500
-------
Cosmetic - Soap: 2.4%
4,650 Avon Products, Inc...................................................... 398,738
-------
Consumer Products: 2.8%
6,300 Kimberly-Clark Corporation.............................................. 469,350
-------
Energy: 4.6%
32,700 Snyder Oil Corporation.................................................. 273,863
30,000 Wheelabrator Tech, Inc.................................................. 498,750
-------
772,613
-------
Food: 0.1%
200 EarthGrains Company..................................................... 5,975
-----
Industrial Raw Materials: 1.0%
10,000 J & L Specialty Steel, Inc.............................................. 171,250
-------
Insurance: 4.7%
21,100 NYMAGIC, Inc............................................................ 414,087
8,250 W. R. Berkley Corporation............................................... 381,563
-------
795,650
-------
<PAGE>
The Osterweis Fund
PORTFOLIO OF INVESTMENTS at March 31, 1996, Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Manufacturing - Diversified: 4.1%
8,900 W.R. Grace and Company.................................................. 696,425
-------
Media and Broadcasting: 7.4%
10,055 Infinity Broadcasting, Class A.......................................... 436,136
17,500 Scandinavian Broadcasting System SA..................................... 393,750
23,400 Westwood One, Inc....................................................... 429,975
-------
1,259,861
---------
Newspapers & Publishing: 3.0%
43,100 K-III Communications Corporation........................................ 501,038
-------
Oil and Related Services: 2.2%
119,100 Gerrity Oil & Gas Corporation........................................... 372,187
-------
Pharmaceutical: 3.4%
14,300 Pharmacia & Upjohn, Inc................................................. 570,212
-------
Real Estate: 5.6%
81,300 Catellus Development Corporation........................................ 630,075
9,300 Crescent Real Estate Equities........................................... 312,713
-------
942,788
-------
Restaurants: 2.7%
20,800 International Dairy Queen, Inc., Class A................................ 457,925
-------
Retail: 8.0%
15,200 Rite Aid Corporation.................................................... 469,300
10,352 Tandy Corporation....................................................... 478,780
15,000 Toys R Us............................................................... 405,000
-------
1,353,080
---------
<PAGE>
The Osterweis Fund
PORTFOLIO OF INVESTMENTS at March 31, 1996, Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Telecommunications: 9.7%
8,650 Cellular Communications, Inc., Class A.................................. $ 442,231
3,000 Cellular Communications International, Inc.............................. 99,750
18,300 Cellular Communications of Puerto Rico.................................. 494,100
20,267 International Cabletel, Inc............................................. 610,543
-------
1,646,624
---------
Total Common Stocks (cost $11,860,634).................................. 13,574,153
----------
PREFERRED STOCK: 0.7%
- ------------------------------------------------------------------------------------------------------------------------------------
6,400 Snyder Oil Corporation, 6.00%, Preferred Convertible A
(cost $126,400)......................................................... 117,600
-------
U.S. GOVERNMENT AND
Principal Amount GOVERNMENT AGENCY OBLIGATIONS: 10.3%
- ------------------------------------------------------------------------------------------------------------------------------------
$400,000 FFCB, 5.52%, 6/3/1996................................................... 400,185
400,000 FFCB, 4.95%, 3/3/1997................................................... 398,016
200,000 FHLB, 6.20%, 10/16/1998................................................. 199,609
300,000 FHLB Structured Note, 5/21/1998, 4.735% to 5/1996;
6.715% thereafter..................................................... 302,161
300,000 FHLB Structured Note, 4/5/1999, 5.60% to 4/1996;
resets annually....................................................... 299,998
150,000 U.S. Treasury Bond, 5.00%, 1/31/1998.................................... 148,125
-------
Total U. S. Government and Government Agency Obligations
(cost $1,746,017)....................................................... 1,748,094
---------
NON-CONVERTIBLE CORPORATE BONDS: 2.8%
- ------------------------------------------------------------------------------------------------------------------------------------
475,000 Northwest Air Corporation, 8.625%, 8/1/1996 (cost $472,691)............. 477,375
-------
<PAGE>
The Osterweis Fund
PORTFOLIO OF INVESTMENTS at March 31, 1996, Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Principal Amount Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
$372,000 Kelley Oil & Gas Partners, 7.875%, 12/15/1999........................... $ 282,720
230,000 National Education Corporation, 6.50%, 5/15/2011........................ 176,525
-------
Total Convertible Corporate Bonds (cost $461,912)....................... 459,245
-------
REPURCHASE AGREEMENTS: 2.7%
- ------------------------------------------------------------------------------------------------------------------------------------
448,000 Star Bank Repurchase Agreement, 5.10%, dated 3/29/1996,
due 4/1/1996, collateralized by $448,000 GNMA, due 5/20/2022
(proceeds $448,188) (cost $448,000)..................................... 448,000
-------
Total Investment in Securities (cost $15,115,654): 99.6%................ 16,824,467
Other Assets less Liabilities: 0.4%..................................... 59,625
------
Total Net Assets: 100.0%................................................ $16,884,092
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
The Osterweis Fund
STATEMENT OF ASSETS AND LIABILITIES at March 31, 1996
- ------------------------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C>
Investments in securities, at value (identified cost $15,115,654) (Note 2-A) .......... $16,824,467
Cash ................................................................................. 242
Receivables:
Fund shares sold................................................................. 500
Dividends and interest .......................................................... 72,346
Organization costs, net of accumulated amortization of $19,329......................... 19,435
Other assets........................................................................... 7,267
-----
Total assets .............................................................. 16,924,257
----------
LIABILITIES
Payables:
Advisor.......................................................................... 16,111
Administrator.................................................................... 3,534
Fund shares repurchased.......................................................... 598
Accrued expenses ...................................................................... 19,922
------
Total liabilities.......................................................... 40,165
------
NET ASSETS ................................................................................. $16,884,092
===========
Net asset value, offering and redemption price per share
($16,884,092/1,438,373 shares outstanding;
unlimited number of shares authorized without par value) ........................ $11.74
======
SOURCE OF NET ASSETS
Paid-in capital ....................................................................... $15,089,146
Undistributed net investment income.................................................... 25,675
Undistributed net realized gain on investments......................................... 60,458
Net unrealized appreciation of investments............................................. 1,708,813
---------
Net assets ...................................................................... $16,884,092
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
The Osterweis Fund
STATEMENT OF OPERATIONS - For the Year Ended March 31, 1996
- ------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Income
<S> <C>
Interest ........................................................................ $ 288,662
Dividends........................................................................ 193,466
Other ........................................................................... 4,323
-----
Total investment income ................................................... 486,451
-------
Expenses
Advisory fees (Note 3) .......................................................... 160,490
Administrative management fee (Note 3)........................................... 38,728
Auditing fees.................................................................... 19,974
Custodian and accounting fees.................................................... 16,947
Amortization of organization costs............................................... 7,774
Transfer agent fees.............................................................. 6,518
Registration fees................................................................ 3,036
Trustees' fees................................................................... 3,009
Miscellaneous.................................................................... 2,991
Insurance........................................................................ 2,574
Reports to shareholders.......................................................... 2,001
Legal fees....................................................................... 1,515
-----
Total expenses............................................................. 265,557
Less, expenses reimbursed (Note 3)......................................... (2,770)
------
Net expenses............................................................... 262,787
-------
Net investment income ............................................. 223,664
-------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain from security transactions .......................................... 148,463
Net unrealized appreciation of investments ............................................ 1,660,534
---------
Net realized and unrealized gain on investments ........................... 1,808,997
---------
Net Increase in Net Assets Resulting from Operations ................ $ 2,032,661
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
The Osterweis Fund
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended Year Ended
March 31, 1996 March 31, 1995
- ------------------------------------------------------------------------------------------------------------------------------------
INCREASE IN NET ASSETS FROM:
OPERATIONS
<S> <C> <C>
Net investment income......................................................... $ 223,664 $ 257,697
Net realized gain (loss) on security transactions ............................ 148,463 (88,092)
Net change in unrealized appreciation of investments.......................... 1,660,534 121,166
--------- -------
Net increase in net assets resulting from operations ................... 2,032,661 290,771
--------- -------
DIVIDEND AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income ($0.19 and $0.25 per share, respectively)............... (279,118) (204,606)
Net realized gain from security transactions ($0.00 and $0.09
per share, respectively)................................................ -0- (62,942)
- -------
Total dividends and distributions to shareholders ...................... (279,118) (267,548)
-------- --------
CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived from net change in
outstanding shares (a) ................................................. 5,348,303 4,630,005
--------- ---------
Total increase in net assets ........................................... 7,101,846 4,653,228
NET ASSETS
Beginning of year ..................................................... 9,782,246 5,129,018
--------- ---------
End of year (including undistributed net investment income
of $25,675 and $81,129, respectively)................................. $16,884,092 $9,782,246
=========== ==========
<FN>
(a) A summary of capital shares transactions is as follows:
Year Ended Year Ended
March 31, 1996 March 31, 1995
Shares Value Shares Value
Shares sold .................................. 709,552 $7,794,336 471,000 $4,870,334
Shares reissued in reinvestment of distribution...... 24,121 271,115 25,349 254,537
Shares redeemed ..................................... (241,996) (2,717,148) (48,473) (494,866)
-------- ---------- ------- --------
Net increase ........................................ 491,677 $5,348,303 447,876 $4,630,005
======= ========== ======= ==========
</FN>
</TABLE>
See accompanying notes to financial statements.
<PAGE>
The Osterweis Fund
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a capital share outstanding throughout each period
- ------------------------------------------------------------------------------------------------------------------------------------
Year Year October 1, 1993*
Ended Ended through
March 31, 1996 March 31, 1995 March 31, 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period ............................ $10.33 $10.28 $10.00
Income from investment operations:
Net investment income ..................................... .12 .28 .08
Net realized and unrealized gain on investments ........... 1.48 .11 .22
---- --- ---
Total from investment operations................................. 1.60 .39 .30
---- --- ---
Less distributions:
Dividends from net investment income....................... (.19) (.25) (.02)
Distributions from net capital gains ....................... -0- (.09) -0-
- ---- -
Total distributions.............................................. (.19) (.34) (.02)
---- ---- ----
Net asset value, end of period .................................. $11.74 $10.33 $10.28
====== ====== ======
Total return .................................................... 15.59% 3.91% 6.29%+
Ratios/supplemental data:
Net assets, end of period (millions)............................. $ 16.9 $ 9.8 $ 5.1
Ratio of expenses to average net assets:
Before expense reimbursement .............................. 1.77% 2.32% 3.73%+
After expense reimbursement................................ 1.75% 1.74% 1.75%+
Ratio of net investment income to average net assets:
Before expense reimbursement .............................. 1.47% 2.74% 0.42%+
After expense reimbursement ............................... 1.49% 3.32% 2.40%+
Portfolio turnover rate ......................................... 57.32% 28.65% 34.97%
<FN>
*Commencement of operations.
+Annualized.
</FN>
</TABLE>
See accompanying notes to financial statements.
<PAGE>
The Osterweis Fund
NOTES TO FINANCIAL STATEMENTS at March 31, 1996
- --------------------------------------------------------------------------------
NOTE 1 - ORGANIZATION
The Osterweis Fund (the "Fund") is a series of shares of beneficial
interest of Professionally Managed Portfolios (the "Trust"), which is registered
under the Investment Company Act of 1940 (the "1940 Act") as a diversified,
open-end management company.
The Fund began operations on October 1, 1993.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund. These policies are in conformity with generally accepted
accounting principles.
A. Security Valuation. Investments in securities traded on a national
securities exchange or included in the NASDAQ National Market System are valued
at the last reported sale price at the close of regular trading on the last
business day of the period; securities traded on an exchange or NASDAQ for which
there has been no sale and other over-the-counter securities are valued at the
last reported bid price. Securities for which quotations are not readily
available are valued at their respective fair values as determined in good faith
by the Board of Trustees. Short-term investments are stated at cost, which when
combined with accrued interest, approximates market value.
U.S. Government securities with less than 60 days remaining to maturity
when acquired by the Fund are valued on an amortized cost basis. U.S. Government
securities with more than 60 days remaining to maturity are valued at the
current market value (using the mean between the bid and asked price) until the
60th day prior to maturity, and are then valued at amortized cost based upon the
value on such date unless the Board determines during such 60 day period that
this amortized cost basis does not represent fair value.
B. Federal Income Taxes. The Fund intends to comply with the
requirements of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its taxable income
to its shareholders. Therefore, no federal income tax
provision is required.
C. Security Transactions, Dividends and Distributions. As is common in
the industry, security transactions are accounted for
on the trade date. Dividend income and distributions to shareholders are
recorded on the ex-dividend date.
D. Deferred Organization Costs. The Fund has incurred expenses of
$38,764 in connection with the organization of the Fund.
These costs have been deferred and are being amortized on a straight line
basis over a period of sixty months from the date the Fund
commenced investment operations.
NOTE 3 - INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
A. Administrative Management Agreement. The Trust, on behalf of the Fund,
has approved an Administrative Management Agreement with Investment Company
Administration Corporation ("ICAC"). The Administrative Management fee is
computed daily and paid monthly by the Fund at the annualized
<PAGE>
The Osterweis Fund
NOTES TO FINANCIAL STATEMENTS at March 31, 1996, Continued
- --------------------------------------------------------------------------------
rate of .20% (previously .25%) of the Fund's average daily net assets or
$30,000, whichever is greater. For the year ended March 31, 1996, the Fund
incurred $38,728 in administrative management fees.
B. Investment Advisory Agreement. The Trust, on behalf of the Fund, has
approved an Advisory Agreement with Osterweis Capital Management, Inc. (the
"Advisor"). The Advisor agrees to furnish all investment advice, office space,
facilities, and most personnel needed by the Fund. Management fees are computed
daily and paid monthly by the Fund at the annualized rate of 1.00% of the Fund's
average daily net assets. In addition, the Advisor is to be reimbursed for
amounts which it previously reimbursed the Fund to the extent that expense
limitations were exceeded in prior years. For the year ended March 31, 1996, the
Fund incurred $160,490 in advisory fees.
C. Agency Agreement. The Trust, on behalf of the Fund, has approved an
Agency Agreement with American Data Services ("ADS") whereby ADS performs
certain record keeping services related to issuance of share, declaration of
dividends, redemption of share, etc. For these services, the Fund shall pay ADS
a transfer agency fee of $500 per month or $8.00 per year per shareholder
account in excess of 750 accounts. For the year ended March 31, 1996 the Fund
incurred $6,518 in transfer agency fees.
D. Fund Accounting Agreement. The Trust, on behalf of the Fund, has
approved a fund accounting agreement with ADS whereby ADS will keep current the
accounting records, including calculation of net asset value. The Fund will pay
ADS $1,200 per month. For the year ended March 31, 1996, the Fund paid $10,429
to its previous fund accountant.
E. Custodian Agreement. The Trust, on behalf of the Fund, has approved
a custodian agreement to employ Star Bank, N.A. as its
custodian. The Custodian fee is computed at rates ranging from .0003% on the
first $20 million. For the year ended March 31, 1996,
the Fund incurred $6,518 in custodian fees.
F. Expense Limitations. The Advisor has undertaken to limit the Fund's
operating expenses to an annual level of 1.75% of the Fund's average daily net
assets, exclusive of brokerage commissions, interest, taxes and extraordinary
expenses. Any such reductions made by the Advisor in its fees or payments or
reimbursement of expenses which are the Fund's obligation are subject of
reimbursement by the Fund within the following three years provided the Fund is
able to effect such reimbursement and remain in compliance with applicable
expense limitations.
First Fund Distributors, Inc. (the "Distributor") acts as the Fund's
principal underwriter in a continuous public offering of
the Fund's shares. The Distributor is an affiliate of the Administrator.
Certain officers and Trustees of the Fund are also officers and/or
directors of the Administrator and ICAC.
NOTE 4 - REPURCHASE AGREEMENTS
The Fund may enter into repurchase agreements with government
securities dealers recognized by the Federal Reserve Board, with member banks of
the Federal Reserve System or with such other brokers
<PAGE>
The Osterweis Fund
NOTES TO FINANCIAL STATEMENTS at March 31, 1996, Continued
- --------------------------------------------------------------------------------
or dealers that meet the credit guidelines established by the Board of Trustees.
The Fund will always receive and maintain, as collateral, securities whose
market value, including accrued interest, will be at least equal to 100% of the
dollar amount invested by the Fund in each agreement, and the Fund will make
payment for such securities only upon physical delivery or upon evidence of book
entry transfer to the account of the custodian. To the extent that any
repurchase transaction exceeds one business day, the value of the collateral is
marked-to-market on a daily basis to ensure the adequacy of the collateral.
If the seller defaults and the value of the collateral declines, or if
bankruptcy proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
NOTE 5 - PURCHASES AND SALES OF SECURITIES
Purchase and sales of securities, other than short-term investments, for
the year ended March 31, 1996 were $17,017,702 and $11,267,654, respectively. At
March 31, 1996, the cost of securities for Federal tax purposes was the same as
the basis for financial reporting. Unrealized appreciation and depreciation of
securities were as follows:
<TABLE>
<S> <C>
Gross unrealized appreciation.................................................... $2,497,000
Gross unrealized depreciation.................................................... (788,187)
--------
Net unrealized appreciation...................................................... $1,708,813
==========
</TABLE>
NOTE 6 - RELATED PARTY TRANSACTIONS
As of March 31, 1996, the Fund owned $448,000 of repurchase agreements
issued by its custodian.
As of March 31, 1996, the Fund shares owned by the Fund's Advisor and its
affiliates totalled 131,060 shares, out of 1,438,373 shares outstanding.
As of March 31, 1996, the Fund had the following receivables and payables
with the Advisor:
Payable to Advisor for investment advisory fee.... $ (16,111)
<PAGE>
The Osterweis Fund
REPORT OF INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
TO THE SHAREHOLDERS OF
THE OSTERWEIS FUND and
THE BOARD OF TRUSTEES OF
PROFESSIONALLY MANAGED PORTFOLIOS
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of The Osterweis Fund (a series of
Professionally Managed Portfolios) as of March 31, 1996, and the related
statement of operations, and changes in net assets and the financial highlights
for the year then ended. 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
audit. The statement of changes in net assets of The Osterweis Fund for the year
ended March 31, 1995, and the financial highlights for year ended March 31, 1995
and the period from October 1, 1993 (commencement of operations) through March
31, 1994 were audited by other auditors whose report dated May 16, 1995
expressed an unqualified opinion on those financial statements and financial
highlights.
We conducted our audits 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 misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of March
31, 1996, 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 1996 financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of The Osterweis Fund as of March 31, 1996, the results of its
operations, the changes in its net assets and the financial highlights for the
year then ended, in conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Los Angeles, California
May 17, 1996
<PAGE>
Advisor
Osterweis Capital Management, Inc.
One Maritime Plaza, Suite 1201
San Francisco, California 94111
================================================================================
Distributor
First Fund Distributors, Inc.
4455 E. Camelback Road, Suite 261E
Phoenix, Arizona 85018
================================================================================
Custodian
Star Bank, N.A.
425 Walnut Street
Cincinnati, Ohio 45202
================================================================================
Transfer Agent
American Data Services
24 West Carver Street
2nd Floor
Huntington, New York 11743
================================================================================
Auditors
Ernst & Young LLP
515 South Flower Street
Los Angeles, California 90071
================================================================================
Legal Counsel
Heller, Ehrman, White & McAuliffe
333 Bush Street
San Francisco, California 94104
This report is intended for shareholders
of The Osterweis Fund and may not be
used as sales literature unless preceded
or accompanied by a current prospectus.
