UNIVERSAL CAPITAL GROWTH FUND
-----------------------------
SEMI-ANNUAL REPORT
MARCH 31, 2000
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
100 S. WACKER DRIVE
SUITE 2100
CHICAGO, IL 60606
(800) 969-9676
- ------------------------------------------------------------------------------
April 18, 2000
Dear Shareholder,
Your fund management team at Graver, Bokhof, Goodwin & Sullivan would like to
thank you for your support. The Universal Capital Growth Fund (the "Fund")
recorded a total return, gross of sales charges, of 18.07% for the fiscal six
months ended March 31, 2000 and 17.44% for the prior twelve-month period. The
Fund's investment results and those of the S&P 500/R Stock Index
(the "S&P 500") are summarized in the following table:
TOTAL RETURNS<F1>
March 31, 2000
- ----------------------------------------------------------------------------
Quarter 6 Months 1 Year 3 Years 5 Years Inception
1/22/91
- ----------------------------------------------------------------------------
Universal Capital
Growth Fund
with 5.5% sales 5.19% 18.07% 17.44% 28.77% 24.75% 18.17%
load effect (0.61)% 11.59% 10.97% 26.36% 23.35% 17.45%
- ---------------------------------------------------------------------------
S&P 500 2.29% 17.51% 17.94% 27.40% 26.76% 20.63%
- ----------------------------------------------------------------------------
<F1> Returns, except for the quarter and 6 months, represent average annual
returns as of March 31, 2000. All returns shown include the reinvestment of
dividends. Past performance is not indicative of future performance.
Investment and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than the original cost. The S&P 500 Stock
Index is an unmanaged but commonly used measure of common stock total return
performance. Please refer to the performance chart on the following page.
Graver, Bokhof, Goodwin & Sullivan assumed management of the Fund on August 15,
1997.
During the past fiscal six-month period, the Fund and the stock market have
experienced unprecedented volatility. The Nasdaq Composite Index (the
"Nasdaq"), primarily driven by the most speculative stocks in the high
technology area, soared some 95% between last October and March of this year
before suffering a sharp 30% sell-off in the past few weeks. The S&P 500, on
the other hand, has made several round trips during the same time period.
Between October and January it rose 20%, fell 10% into early March and again
rose 17% in less than two weeks to a new high. Within the last few days the S&P
500 has joined the high technology decline and fallen another 14% back to its
March low.
We have talked about the market's valuation excesses and its bifurcation for
some time now. The "old economy" stocks, namely all those not included in
technology, communications and biotechnology, have been experiencing a downward
revaluation for over a year. Some 60% of all stocks are down over 30% from
their fifty-two week highs and 70% of all companies in the S&P 500 carry
price/earnings multiples below 20 times earnings. For the past year, these
stocks have suffered from Fed interest rate increases, rising raw material
prices, tight labor markets and margin pressure due to a significant lessening
in cost cutting capabilities via restructuring, etc. Currently, a number of
such stocks, which are represented in the Fund, have begun to respond to signs
of a slowing in economic activity and have begun to display bottoming
characteristics.
First quarter 2000 earnings reports are expected to be very good overall. While
high-tech stocks will be the main beneficiary of the positive earning surprises
to occur, valuation levels in this group got so far out of line with the market
in general that we expect the current weakness in the group to continue after
the reporting period is over. The recent precipitous decline in the Nasdaq is a
signal that valuation does matter, even for the "new economy" stocks. Good
quality technology companies will be fine long-term investments but during the
next few months additional selling may occur. Margin debt to purchase
securities is at a staggering $275 billion level, up 50% from a year ago.
Further declines in heavily margined stocks could cause substantial collateral
damage along the way.
The Fund has continued to benefit from the strong performance of large
capitalization issues. During the most recent quarter, the Fund's
diversification also helped to outperform the S&P 500 with the Fund up 5.2%
versus 2.3% for the S&P 500. Not surprisingly, the largest gains in the
portfolio came from telecommunication, technology, and
<PAGE>
investment brokerage industries. Telecom stocks including ADC
Telecommunications and Cisco Systems enjoyed good gains. Merrill Lynch and
Morgan Stanley Dean Witter were also up handsomely. American Power Conversion,
Intel, Lexmark International and Solectron Corp. were outsized performers among
the technology group as a whole. The worst performers in the Fund involved
healthcare stocks and those that experienced problems during the period such as
Proctor & Gamble and Carnival Corp., which announced earnings disappointments.
New purchases included: Carnival Corp., Costco Wholesale Corporation, Gap,
Inc., Lowe's Companies, New York Times and Staples, Inc. in the general consumer
sector. We also added R&B Falcon to our energy holdings and added two new
technology names in Conexant Systems and Solectron Corp. During the past six
months, we took gains by scaling back oversized holdings in the technology area.
We are confident that the Fund's portfolio is well positioned to participate in
any further appreciation of the general market. Fundamentally, the portfolio
looks very attractive when compared to the S&P 500. The revenues and earnings
growth projections for the companies owned in the Fund for the next 3-5 years
are almost double that of the S&P 500, while return on equity is some 30%
higher.
We are encouraged by the progress we have made since assuming management of the
Fund's assets in the fall of 1997 and look forward to working for you in the
years ahead. Please feel free to call us if you have any questions or concerns.
We would be delighted to hear from you.
Sincerely,
/s/Andrew J. Goodwin, III
Andrew J. Goodwin, III
President
<F1>The views expressed in this report reflect those of the investment adviser
as of April 18, 2000 and those views are subject to change at any time based
upon market and other conditions. Specific reference to individual securities
and the Fund's investment positions as of March 31, 2000 are as follows: ADC
Telecommunications, Inc., 4.3%; Cisco Systems, Inc., 4.7%; Merrill Lynch & Co.,
Inc., 3.2%; Morgan Stanley Dean Witter & Co., 4.1%; American Power Conversion
Corporation, 4.3%; Intel Corporation, 4.0%; Lexmark International Group, Inc.,
2.7%; Solectron Corporation, 2.8%; Proctor & Gamble Company (The), 1.1%;
Carnival Corporation, 0%; Costco Wholesale Corporation, 1.9%; Gap, Inc. (The),
2.5%; Lowe's Companies, Inc., 2.4%; New York Times Company (The), 2.2%; Staples,
Inc., 1.8%; R&B Falcon Corporation, 1.0% and Conexant Systems, Inc., 0.9%. The
Fund holdings may change due to ongoing management and references to specific
investments should not be construed as a recommendation of the Fund or its
Adviser.
GROWTH OF $10,000 INVESTMENT
Date Universal Capital Growth Fund S&P Stock Index
1/22/91 9,452 10,000
9/30/91 10,548 11,984
9/30/92 11,001 13,308
9/30/93 12,337 15,038
9/30/94 13,257 15,592
9/30/95 18,278 20,230
9/30/96 19,631 24,344
9/30/97 26,745 34,190
9/30/98 28,649 37,283
9/30/99 37,123 47,650
3/31/00 43,820 55,995
TOTAL RETURN<F1>
with 5.5% sales load effect
- -------------------------------
1 year 10.97%
5 year 23.35%
Since inception 17.45%
- -------------------------------
<F1>Represents average annual returns.
This chart assumes an initial gross investment of $10,000 made on 1/22/91
(commencement). 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. The Fund's performance graph includes
deduction of the 5.5% front-end load. The S&P 500 Stock Index is an unmanaged
but commonly used measure of common stock total return performance.
This report is not authorized for distribution to prospective investors unless
accompanied or preceded by an effective prospectus for the Fund.
Dreher & Associates, Inc. as Distributor
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2000 (UNAUDITED)
SHARES VALUE
------- ------
COMMON STOCKS 98.32%
- --------------------------------------------------
AEROSPACE AND DEFENSE 2.55%
United Technologies Corporation 8,000 $505,500
BANKS 5.20%
MBNA Corporation 15,000 382,500
Net.b@nk, Inc.<F1> 9,000 117,000
Wells Fargo & Company 13,000 532,187
----------
1,031,687
COMPUTERS 3.57%
International Business Machines Corporation 6,000 708,000
COMPUTER NETWORKS 4.68%
Cisco Systems, Inc.<F1> 12,000 927,750
COMPUTER SOFTWARE 6.52%
BMC Software, Inc.<F1> 9,000 444,375
Microsoft Corporation<F1> 8,000 850,000
----------
1,294,375
CONSUMER PRODUCTS 1.13%
Procter & Gamble Company (The) 4,000 225,000
DIVERSIFIED MISCELLANEOUS 3.02%
Tyco International Ltd. 12,000 598,500
ELECTRICAL EQUIPMENT 3.13%
General Electric Company 4,000 620,750
ELECTRONIC PRODUCTS & COMPONENTS 14.70%
American Power Conversion Corporation<F1> 20,000 857,500
Conexant Systems, Inc.<F1> 2,500 177,500
Intel Corporation 6,000 791,625
Lexmark International Group, Inc., Class A<F1> 5,000 528,750
Solectron Corporation* 14,000 560,875
----------
2,916,250
ENERGY 4.09%
Halliburton Company 15,000 615,000
R&B Falcon Corporation<F1> 10,000 196,875
----------
811,875
FINANCE & FINANCIAL SERVICES 10.05%
American International Group, Inc. 5,000 547,500
Merrill Lynch & Co., Inc. 6,000 630,000
Morgan Stanley Dean Witter & Co. 10,000 815,625
----------
1,993,125
<F1> Non-income producing
See Notes to the Financial Statements
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
MARCH 31, 2000 (UNAUDITED)
SHARES VALUE
------- ------
COMMON STOCKS (CONTINUED) 98.32%
- --------------------------------------------------
HEALTHCARE 11.16%
Amgen Inc.<F1> 10,000 $613,750
Boston Scientific Corporation<F1> 20,000 426,250
Johnson & Johnson 5,000 350,313
Medtronic, Inc. 16,000 823,000
----------
2,213,313
NEWSPAPER 2.16%
New York Times Company (The), Class A 10,000 429,375
PHARMACEUTICALS 4.33%
Merck & Co., Inc. 7,200 447,300
Schering-Plough Corporation 11,200 411,600
----------
858,900
RETAIL 11.13%
Costco Wholesale Corporation<F1> 7,000 367,937
Gap, Inc. (The) 10,000 498,125
Lowe's Companies, Inc. 8,000 467,000
Staples, Inc.<F1> 18,000 360,000
Walgreen Co. 20,000 515,000
----------
2,208,062
TELECOMMUNICATIONS 10.90%
ADC Telecommunications, Inc.<F1> 16,000 862,000
MCI WorldCom, Inc.<F1> 13,426 608,366
Tellabs, Inc.<F1> 11,000 692,828
----------
2,163,194
----------
TOTAL COMMON STOCKS 19,505,656
(COST $10,766,481) ===========
RIGHTS 0.00%
- --------------------------------------------------
U.S. Surgical, 9/23/00<F1> 7 531
----------
TOTAL RIGHTS 531
(COST $0) ----------
<F1> Non-income producing
See Notes to the Financial Statements
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
MARCH 31, 2000 (UNAUDITED)
PRINCIPAL
AMOUNT VALUE
---------- -----
SHORT-TERM INVESTMENTS 1.86%
- --------------------------------------------------
MONEY MARKET 1.86%
UMB Bank, n.a. Money Market Fiduciary $368,543 $368,543
---------
TOTAL MONEY MARKET 368,543
=========
TOTAL SHORT-TERM INVESTMENTS 368,543
(COST $368,543) =========
TOTAL INVESTMENTS 100.18% 19,874,730
(COST $11,135,024)
LIABILITIES LESS OTHER ASSETS (0.18)% (36,667)
----------
NET ASSETS 100.00% $19,838,063
===========
<F1> Non-income producing
See Notes to the Financial Statements
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 2000 (UNAUDITED)
ASSETS:
Investments at value (cost $11,135,024) $19,874,730
Dividends and interest receivable 6,229
Prepaid expenses 14,157
-----------
Total Assets 19,895,116
-----------
LIABILITIES:
Accrued distribution fees 15,237
Payable to Adviser 11,870
Other accrued expenses and liabilities 29,946
-----------
Total Liabilities 57,053
-----------
NET ASSETS $19,838,063
===========
NET ASSETS CONSIST OF:
Paid-in-capital $9,900,917
Accumulated net realized gain
on investments 1,197,440
Net unrealized appreciation
on investments 8,739,706
-----------
TOTAL NET ASSETS $19,838,063
===========
NET ASSET VALUE PER SHARE
($19,838,063 DIVIDED BY
808,891 SHARES OUTSTANDING) $24.53
======
MAXIMUM OFFERING PRICE
PER SHARE
(NET ASSET VALUE, PLUS 5.82% OF NET
ASSET VALUE OR 5.50% OF OFFERING PRICE) $25.96
======
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED MARCH 31, 2000 (UNAUDITED)
INVESTMENT INCOME:
Dividend income $48,705
Interest income 16,072
--------
64,777
--------
EXPENSES:
Investment advisory fees 93,271
Distribution fees 38,374
Transfer agent fees and expenses 12,890
Reports to shareholders 10,003
Legal fees 9,362
Audit fees 9,256
Fund accounting fees 8,981
Federal and state registration fees 6,189
Custody fees 4,788
Trustees' fees and expenses 3,846
Administrative services agreement fees 3,305
Other 2,127
--------
Total expenses before waiver 202,392
Waiver of investment advisory fees (15,849)
--------
Net expenses 186,543
--------
Net investment loss (121,766)
--------
REALIZED AND UNREALIZED GAINS:
Net realized gain on investments 1,338,979
Change in net unrealized appreciation
on investments 1,887,485
--------
Net gain on investments 3,226,464
--------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $3,104,698
==========
See Notes to the Financial Statements
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
MARCH 31, 2000 YEAR ENDED
(UNAUDITED) SEPTEMBER 30,1999
-------------- ----------------
OPERATIONS:
Net investment loss $(121,766) $(216,298)
Net realized gain on investments 1,338,979 1,063,779
Change in net unrealized
appreciation on investments 1,887,485 3,214,680
---------- ----------
Net increase in net assets
resulting from operations 3,104,698 4,062,161
---------- ----------
DISTRIBUTIONS:
Net realized gains (1,205,318) (1,399,939)
---------- ----------
CAPITAL SHARE TRANSACTIONS :
Proceeds from 26,395 and 38,445
shares issued, respectively 608,381 871,272
Net asset value of 51,492 and 71,994
shares issued to holders in reinvestment
of dividends, respectively 1,178,649 1,375,088
Cost of 64,725 and 52,497 shares redeemed,
respectively (1,523,090) (1,144,818)
---------- ----------
Net increase from capital transactions 263,940 1,101,542
---------- ----------
TOTAL INCREASE IN NET ASSETS 2,163,320 3,763,764
NET ASSETS:
Beginning of period 17,674,743 13,910,979
---------- ----------
End of period $19,838,063 $17,674,743
=========== ===========
See Notes to the Financial Statements
<PAGE>
FINANCIAL HIGHLIGHTS
UNIVERSAL CAPITAL GROWTH FUND
<TABLE>
<CAPTION>
SIX MONTHS ENDED
MARCH 31, 2000 YEAR ENDED SEPTEMBER 30,
(UNAUDITED) 1999 1998 1997<F1> 1996 1995
-------------- ----- ----- -------- ------ ------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $22.21 $18.86 $18.09 $14.99 $16.28 $12.47
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.15) (0.27) (0.21) (0.08) (0.10) (0.10)
Net realized and unrealized gain
on investments 4.04 5.54 1.46 4.97 1.14 4.54
------ ------- ------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS 3.89 5.27 1.25 4.89 1.04 4.44
------ ------- ------- ------- ------- -------
LESS DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net realized gains (1.57) (1.92) (0.48) (1.79) (2.33) (0.63)
------ ------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $24.53 $22.21 $18.86 $18.09 $14.99 $16.28
======= ======= ======= ======= ======= =======
TOTAL RETURN <F2><F3> 18.07% 29.54% 7.12% 36.24% 7.40% 37.87%
SUPPLEMENTAL DATA AND RATIOS:
Ratio of net expenses to average net assets
Before waiver of investment
adviser fees <F4> 2.17% 2.18% 2.37% 2.50% 2.35% 2.66%
After waiver of investment
adviser fees <F4> 2.00% 2.00% 2.00% 2.00% 2.00% 2.00%
Ratio of net investment loss to
average net assets
Before waiver of investment
adviser fees <F4> (1.48)% (1.44)% (1.40)% (0.98)% (1.02)% (1.43)%
After waiver of investment
adviser fees <F4> (1.31)% (1.26)% (1.03)% (0.48)% (0.67)% (0.77)%
Portfolio turnover rate <F3> 17.40% 71.1% 58.1% 49.2% 262.1% 157.6%
Net assets, end of period (in 000's) $19,838 $17,675 $13,911 $12,994 $11,124 $8,149
<F1> On August 15, 1997, the adviser changed to Graver, Bokhof, Goodwin
& Sullivan from Integrated Financial Services, Inc.
<F2> The total return calculation does not reflect any sales load
imposed on the purchase of shares.
<F3> Not annualized for the period ended March 31, 2000.
<F4> Annualized for the period ended March 31, 2000.
</TABLE>
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
NOTES TO THE FINANCIAL STATEMENTS
MARCH 31, 2000 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION. Universal Capital Investment Trust (the "Trust") is a
Massachusetts business trust organized on October 18, 1990. The Trust is
registered under the Investment Company Act of 1940 (the "1940 Act") as a
diversified, open-end investment company. Universal Capital Growth Fund (the
"Fund"), the only series of the Trust currently offered, commenced selling
shares to the public on January 22, 1991 (commencement of operations).
INVESTMENT VALUATION. Investments are stated at value. Investments traded on a
securities exchange or in the over-the-counter market are valued at the last
current sale price as of the time of valuation or, lacking any current reported
sale on that day, at the mean between the most recent bid and asked quotations.
Investments for which quotations are not readily available and securities for
which the valuation methods described above do not produce a value reflective of
the fair value of the securities are valued at a fair value as determined in
good faith by the board of trustees or a committee thereof.
OPTION CONTRACTS. The Fund purchases put option contracts to hedge portfolio
investments. Option contracts are valued at the last current sale price as of
the time of valuation or, lacking any current reported sale on that day, at the
mean between the most recent bid and asked quotations. When option contracts
expire or are closed, realized gains or losses are recognized without regard to
any unrealized gains or losses on the underlying securities.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME. Investment transactions are
recorded on the trade date (the day the order to buy or sell is executed).
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis. Realized gains and losses from investment
transactions are reported on an identified cost basis.
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 amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
FEDERAL INCOME TAXES AND DIVIDENDS TO SHAREHOLDERS. It is the Fund's policy to
comply with the special provisions of the Internal Revenue Code available to
regulated investment companies and, in the manner provided therein, to
distribute all of its taxable income, as well as any net realized gain on sales
of investments. Such provisions were complied with and therefore no provision
for federal income taxes is required.
The character of distributions made during the year from net investment income
or net realized gains may differ from the characterization for federal income
tax purposes due to differences in the recognition of income, expense or gain
items for financial statement and tax purposes. Where appropriate,
reclassifications between net asset accounts are made for such differences that
are permanent in nature. Accordingly, at March 31, 2000, the Fund reduced paid-
in-capital by $121,766 for the current period's net investment loss.
REPURCHASE AGREEMENTS. The Fund may invest in repurchase agreements. All
repurchase agreements are fully collateralized by U.S. Treasury securities. All
collateral is held through the Fund's custodian bank and is monitored daily by
the Fund to ensure that its market value exceeds the carrying value of the
repurchase agreements.
2.TRANSACTIONS WITH AFFILIATES
Pursuant to an investment advisory agreement with Graver, Bokhof, Goodwin &
Sullivan (the "Adviser"), the Fund pays an investment advisory fee at the annual
rate of 1.0% of the first $250 million of the Fund's average daily net assets
and .75% of the Fund's average daily net assets in excess of $250 million.
During the six months ended March 31, 2000, the Fund incurred investment
advisory fees of $93,271 under this agreement.
The agreement provides for the waiver of expenses from the Adviser through
December 31, 2000 should the Fund's normal operating expenses exceed 2.00% of
average daily net assets. During the six months ended March 31, 2000, the
Adviser waived $15,849 of its investment advisory fee.
Dreher & Associates, Inc. (the "Distributor") serves as distributor for the
Trust. The Trust has adopted a Distribution Plan pursuant to Rule 12b-1 under
the 1940 Act. Pursuant to that plan, prior to January 28, 2000, the Fund paid
the Distributor a monthly service fee of .25% and a monthly distribution fee of
.25%, based on the Fund's average daily net assets. As of January 28, 2000, the
Fund pays the Distributor a monthly distribution fee of .25%, based on the
Fund's average daily net assets. In return, the Distributor bears all expenses
incurred in the distribution and promotion of the Fund's shares. During the six
months ended March 31, 2000, the Fund incurred fees under the plan of $38,374.
The Distributor received commissions of $8,617 from sale of the Fund's shares
during the six months ended March 31, 2000.
Effective January 28, 2000, the Trust has adopted an Administrative Services
Agreement whereby the Fund pays the Distributor a monthly fee of .10%, based on
the Fund's average daily net assets. In return, the Distributor provides
information and administrative services for the benefit of the Fund and its
shareholders. During the period January 28 to March 31, 2000, the Fund incurred
$3,305 in administrative services fees.
Portfolio transactions for the Fund have been executed through the Distributor,
consistent with the Fund's policy of obtaining best price and execution. During
the six
<PAGE>
UNIVERSAL CAPITAL GROWTH FUND
NOTES TO THE FINANCIAL STATEMENTS
MARCH 31, 2000 (UNAUDITED)
months ended March 31, 2000, the Fund paid brokerage commissions to the
Distributor on purchases and sales of securities in the amount of $4,840. It is
the Adviser's opinion that the use of the Distributor to execute portfolio
transactions results in prices for and execution of securities transactions at
least as favorable to the Fund as those likely to be derived from other
qualified brokers. In addition, the Distributor charges the Fund commission
rates consistent with those charged by the Distributor in similar transactions
to clients that are comparable to the Fund.
3.INVESTMENTS
Purchases and sales of investments, other than short-term obligations, were
$3,122,554 and $3,420,950 respectively, for the six months ended March 31, 2000.
The cost basis of investments for financial statement and federal income tax
purposes at March 31, 2000 was $11,135,024. At March 31, 2000, gross unrealized
appreciation was $9,152,538, gross unrealized depreciation was $412,832 and net
unrealized appreciation was $8,739,706.
INVESTMENT ADVISER
Graver, Bokhof, Goodwin & Sullivan
100 South Wacker Drive, Suite 2100
Chicago, Illinois 60606
(800) 969-9676
DISTRIBUTOR
Dreher & Associates, Inc.
One Oakbrook Terrace, Suite 708
Chicago, Illinois 60181
(630) 932-3000
CUSTODIAN
UMB Bank, n.a.
P.O. Box 419226
Kansas City, Missouri 64141
TRANSFER AGENT
Sunstone Financial Group, Inc.
207 East Buffalo Street, Suite 400
Milwaukee, WI 53202
(800) 537-3446
COUNSEL
Vedder, Price, Kaufman & Kammholz
Chicago, Illinois
INDEPENDENT AUDITORS
Ernst & Young LLP
Chicago, Illinois
This report is submitted for the general information of shareholders of the
Universal Capital Growth Fund. It is not authorized for distribution to
prospective investors unless accompanied or preceded by an effective prospectus
for the Fund. The prospectus gives details about charges, investment objectives,
risks and operation policies of the Fund. Read the prospectus carefully.
<PAGE>
