<PAGE>
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SEMI-ANNUAL REPORT
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HOMESTATE
The Y2K Fund
The HomeState Year 2000 ("Y2K") Fund
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December 31, 1997
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[LOGO OF HOMESTATE APPEARS HERE]
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January 15, 1998
Dear Shareholder:
We are pleased to report the Y2K Fund outperformed its peer group and benchmark
since its introduction on October 31, 1997. The total return without adjustment
for sales charges for the Fund over the past 2 months was 6.50%.
Aggregate Returns
Since Inception
10/31/97 /1/
The Y2K Fund (at N.A.V.)............... 6.50%
The Y2K Fund
(at Maximum Offering Price)........... 3.41%
Russell 2000 Index..................... 1.09%
Morningstar Technology Fund Average.... (5.37%)
The Russell 2000 Index is an unmanaged index of 2,000 smaller-sized companies.
Investments cannot be made in an index. The Morningstar Technology Funds Average
includes the total return (without the effects of sales charges) for the Y2K
Fund since inception period ended December 31, 1997 for 54 technology mutual
funds.
The unique characteristics of the Fund have enabled it to benefit from both
rising and falling stocks. The Fund may sell "short" or buy put options on
securities which it believes are overvalued based on their fundamentals.* This
allows the Y2K Fund an opportunity to benefit from poorly performing stocks as
well as those with superior performance qualities.
"The year 2000 date change is likely to be the single biggest project ever
undertaken for information technology organizations. . . Gartner Group predicts
that more than half of all organizations world wide will not fully complete the
year 2000 effort."
BRUCE H. HALL, GARTNER GROUP, INC., TESTIMONY BEFORE U.S. CONGRESSIONAL
SUBCOMMITTEE, 3/20/97
"The 'Year 2000' issue is a serious and critical challenge for all modern
organizations. It has been estimated that, without corrective measures, 90% of
all computer applications worldwide will fail or create seriously erroneous
results because of an inability to properly recognize the century change. . .
The Year 2000 technology problem is a very serious issue, and there is no quick
fix. It represents a significant operating risk which needs attention from the
board room, not just the technology department; and it is already too late to
start."
MORGAN STANLEY YEAR 2000 ISSUE PAPER, 1/17/97
"The Year 2000 computer bug is scary enough. It threatens to shut down or
damage at least half the computers worldwide come January 1, 2000. That could
garble financial transactions, halt factory lines, disrupt hospitals and cause
traffic accidents by turning off stoplights. . . Regional phone companies have
more than 70,000 programs vulnerable to the bug and they cannot be repaired or
replace in the 26 months remaining' says software consultant John Zubeck"
USA TODAY 11/10/97
This "Year 2000" issue is serious, scary, and indeed extremely large (Gartner
Group estimated between $300 and $600 billion will be spent correcting the
problem.) Emerald Research believes the market for third party vendors of code
conversion products and services could exceed $100 billion.
<PAGE>
Y2K problems stem from the decision to represent the year using two digits
instead of four. In many cases, these problem-creating hardware and software
design decisions were made over 10 years ago when it was more important to save
cost than to consider the consequences of errors that wouldn't occur until the
turn of the century. Because of the 2-digit representation, computers cannot
differentiate between the years 1900 ("00") and 2000 ("00"), between 1901 and
2001, etc. This leads to potential errors in date calculations, i.e., the period
between the years 2006 and 1996 in a four digit system is 10 years (2006-1996),
whereas in a two digit system it is 90 (6-96).
Without correction, massive system malfunctions could result for calculations
involving years after 1999. For instance, credit cards with an expiration date
of 01/00 would appear to have expired in 1900. There would be dramatic problems
when calculating mortgages, leases, contracts, interest payments, or bonds with
negative periods; milk produced on 01/01/00 would be deemed to be 100 years
older than milk produced on 12/31/99 and could be discarded by automated
handling equipment. Software applications that sort or classify items by date
would be completely disrupted.
Although a broad segment of companies could potentially be impacted by Y2K
expenditures, HomeState believes IT ("Information Technology") service providers
and software tool vendors offer the best investment opportunities. We expect an
acceleration in contract signings, revenues and backlog to lead to upward
earnings revision and higher stock prices. We also believe IT service providers
and software tool vendors will experience a rapid acceleration in sales and
earnings as organizations begin the correction phase of the Y2K code conversion
process. Approximately 75% of the total Y2K code conversion cost occurs during
the correction and testing phases. Since a majority of firms have not begun the
correction phase, a vast majority of business remains.
HomeState uses a number of criteria when determining solid Y2K investment
opportunities. In addition to a solid management team, a strong product or
service offering, sufficient financing, and large market opportunity, we look
for the following strengths:
. Companies that can leverage an existing business providing a similar
product or service.
. Companies that can obtain a meaningful increase in earnings as a result of
a Y2K product or service offering.
. Companies with a product or service that is already available to customers,
or is in a late development stage.
. Companies with a solid business model after the year 2000.
. Management with experience in a related business.
. Companies that can manage to finance a steep revenue ramp.
. Attractive valuation given the company's growth prospects and market
opportunity.
Currently our largest exposure is to the front-end service providers and
consultants who are receiving the majority of Year 2000 contracts currently
being announced. We believe software tool providers who will perform the actual
code conversion will be the recipients of contracts later in 1998.
While many reports have been written concerning the Year 2000 costs and its
effect on the economy, including those in Barron's, The Wall Street Journal and
Investor's Business Daily, a recent Bloomberg News report on January 13/th/ 1998
seemed to catch the attention of most portfolio managers. First Call Corp.,
<PAGE>
which collects Wall Street's earnings estimates, has a flaw in its computers
that prevents it from plugging in information for beyond the start of the new
century. The Boston-based company's computer system is afflicted with the so-
called Year 2000 bug. That's the glitch crippling thousands of software
programs, keeping them from registering the year 2000 as a two-digit date
without some kind of alteration. The computer problem is keeping the investors,
bankers and analysts who rely on First Call from receiving earnings information,
statistical ratios and analyst recommendations for the year 2000 or after.
This portfolio, while sprinkled with some consumer stocks as well as some non-
Y2K technology stocks, will always have over 65% of the portfolio invested in
Year 2000 solution providers. As of the end of the year the Fund was almost 80%
invested in these companies. While this portfolio will be volatile in 1998, we
believe the Year 2000 companies provide unique opportunities for the mutual fund
investor. Since HomeState provides the only mutual fund that is dedicated to
this area, we expect to receive substantial attention and investor interest in
the coming years.
Sincerely,
Kenneth G. Mertz II, CFA
Chief Investment Officer
<PAGE>
<TABLE>
<CAPTION>
COMMON STOCK -- 87.6%
INSURANCE -- 1.0%
<S> <C> <C>
Reliance Group Holdings, Inc....................................... 1,800 $ 25,425
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MANUFACTURING -- 17.1%
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Computer & Office Equipment -- 11.6%
Information Analysis, Inc.*........................................ 2,000 28,000
Iomega Corp.*...................................................... 5,000 62,187
Tangram Enterprise Solutions*...................................... 16,500 108,281
Unisys Corp........................................................ 6,800 94,350
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292,818
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Food & Beverage -- 1.4%
Quigley Corp.*..................................................... 2,500 36,095
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Miscellaneous Electrical Machinery, Equipment & Supplies -- 2.4%
Technitrol, Inc.................................................... 2,000 60,000
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Textiles & Apparel -- 1.7%
Jones Apparel Group, Inc.*......................................... 1,000 43,000
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Total Manufacturing........................................................... 431,913
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SERVICES -- 69.5%
Business Services -- 9.6%
Diamond Technology Partners, Inc.*................................. 4,000 62,000
Gartner Group, Inc. (A Shares)..................................... 2,000 74,500
SOS Staffing Services, Inc.*....................................... 1,200 22,650
Whittman-Hart, Inc................................................. 2,400 82,200
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241,350
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Computer Services -- 59.9%
Cambridge Technology Partners, Inc.*............................... 2,000 83,250
Computer Horizons Corp.*........................................... 3,000 135,000
Computer Management Sciences*...................................... 1,900 36,337
Information Management Resources, Inc.*............................ 1,500 56,250
Keane, Inc.*....................................................... 6,100 247,813
Mapics, Inc.*...................................................... 2,500 27,187
Mastech Corp.*..................................................... 4,900 155,575
Mercury Interactive Corp.*......................................... 2,700 72,225
Micro Focus Group PLC ADR*......................................... 1,000 40,375
OAO Technology Solutions, Inc.*.................................... 3,000 27,750
Platinum Technology, Inc........................................... 2,000 56,500
Safeguard Scientifics, Inc.*....................................... 4,000 125,500
SEEC, Inc.*........................................................ 2,900 46,944
Computer Services -- continued
Systems & Computer Technology Corp.*............................... 2,000 $ 99,250
Topro, Inc.*....................................................... 15,500 100,750
Unicomp, Inc.*..................................................... 3,000 23,625
Viasoft, Inc.*..................................................... 2,500 105,625
Zitel Corp.*....................................................... 7,000 66,500
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1,506,456
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Total Services................................................................ 1,747,806
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Total Common Stock(Cost $2,091,088)........................................... 2,205,144
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</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C>
OPTIONS -- 6.1%
Call Options -- 2.8%
De Jager Year 2000 Index Call Options February 1998 @ $310......... 1,000 70,875
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Put Options -- 3.3%
Zolt Put Options January 1998 @ $30................................ 2,000 6,750
Zolt Put Options January 1998 @ $35................................ 2,000 15,250
Zolt Put Options January 1998 @ $40................................ 5,000 60,000
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82,000
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Total Options (Cost $104,241)................................................. 152,875
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COMMERCIAL PAPER -- 4.0%
American Express, 5.00%, 01/06/98 (Cost $100,000).................. $100,000 100,000
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MONEY MARKET MUTUAL FUND -- 3.0%
Scudder Managed Cash Fund (Cost $75,995)........................... 75,995 75,995
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TOTAL INVESTMENTS (COST $2,371,324) -- 100.7%...................................... 2,534,014
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SECURITY SOLD SHORT --(0.4)%
GTI Corp.* (Proceeds $13,718)...................................... 2,500 (12,188)
RECEIVABLES FROM BROKERS FOR SECURITY SOLD SHORT -- 0.5%........................... 13,718
OTHER ASSETS AND LIABILITIES, NET -- (0.8)%........................................ (20,194)
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NET ASSETS -- 100.0%............................................................... $2,515,350
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</TABLE>
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The HomeState Year 2000 Fund
Statement of Assets and Liabilities (Unaudited) December 31, 1997
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ASSETS
Investment in securities at market value (cost $2,371,324)...... $ 2,534,014
Cash............................................................ 135,952
Deposits with brokers and custodian bank for options held....... 26,332
Receivables:
Brokers for securities sold short............................. 13,718
Dividends and interest receivable............................. 436
Capital shares sold........................................... 57,771
From Adviser.................................................. 20,579
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Total assets................................................ 2,788,802
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LIABILITIES
Payables for:
Securities sold short at market value (proceeds $13,718)...... 12,188
Investment securities purchased............................... 233,594
Accrued expenses................................................ 27,670
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Total liabilities........................................... 273,452
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NET ASSETS...................................................... $ 2,515,350
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NET ASSETS CONSIST OF:
Shares of beneficial interest................................... $ 2,348,182
Accumulated net investment loss................................. (4,710)
Accumulated net realized gain on investments (Note 4)........... 7,658
Net unrealized appreciation on investments...................... 162,690
Net unrealized appreciation on securities sold short............ 1,530
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Net Assets.................................................... $ 2,515,350
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NET ASSET VALUE and redemption price per share
($2,515,350 / 236,255 issued and outstanding shares,
no par value)................................................. $10.65
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Maximum offering price per share (100 / 97.10 of $10.65)........ $10.97
======
See accompanying Notes to Financial Statements 7
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The HomeState Year 2000 Fund
Statement of Operations (Unaudited) for the Period Ending December 31, 1997+
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INVESTMENT INCOME:
Dividends..................................................... $ 144
Interest...................................................... 2,380
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Total investment income..................................... 2,524
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Expenses:
Advisory fees................................................. 2,494
Administration fees........................................... 3,233
Transfer Agent fees........................................... 4,442
Custodian fees................................................ 2,962
Accounting fees............................................... 6,466
Professional fees............................................. 4,073
Printing expenses............................................. 3,110
Registration fees............................................. 119
Trustees' fees and expenses................................... 1,592
Amortization of organizational expenses....................... 873
Miscellaneous expenses........................................ 942
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Total expenses before fee waivers and reimbursements........ 30,307
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Advisory fee waived (Note 5).................................. (2,494)
Reimbursement from Adviser (Note 5)........................... (20,579)
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Total expenses, net......................................... 7,234
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Net investment loss............................................. (4,710)
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REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investment transactions.................. 7,658
Change in unrealized appreciation on investments.............. 162,690
Change in unrealized appreciation on securities sold short.... 1,530
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Net realized and unrealized gain on investments................. 171,878
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NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS..................................... $ 167,168
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+ Commencement of Operations, November 3, 1997.
8 See accompanying Notes to Financial Statements
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THE HOMESTATE YEAR 2000 FUND
Statements of Changes in Net Assets
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FOR THE PERIOD ENDED DECEMBER 31, 1997+ (UNAUDITED)
<TABLE>
<S> <C>
OPERATIONS:
Net investment loss......................................... $ (4,710)
Net realized gain on investment transactions................ 7,658
Change in unrealized appreciation on investments............ 162,690
Change in unrealized appreciation on securities sold short.. 1,530
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Net increase in net assets resulting from operations........ 167,168
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NET INCREASE FROM CAPITAL SHARE
TRANSACTIONS (Note 3)...................................... 2,347,182
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TOTAL INCREASE IN NET ASSETS................................. 2,514,350
NET ASSETS:
Beginning of period....................................... 1,000
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End of period............................................. $2,515,350
=========
</TABLE>
+ Commencement of Operations, November 3, 1997.
See accompanying Notes to Financial Statements 9
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The HomeState Year 2000 Fund
Financial Highlights
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For a share outstanding throughout the period:
For the
Period Ending
December 31, 1997+
(Unaudited)
------------------
Net asset value at beginning of period.................. $ 10.00
--------
Income from Investment Operations
- ---------------------------------
Net investment loss..................................... (0.02)
Net realized and unrealized gain on investments......... 0.67
--------
Total from investment operations..................... 0.65
--------
Net asset value at end of period........................ $ 10.65
========
Total return**.......................................... 6.50%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of period (000s omitted).............. $2,515
Ratio of expenses to average net assets before
reimbursements by adviser and waivers............... 12.15%*
Ratio of expenses to average net assets after
reimbursement by adviser and waivers................ 2.90%*
Ratio of net investment loss to average net
assets before reimbursement by adviser and waivers.. (11.14)%*
Ratio of net investment loss to average net
assets after reimbursement by adviser and waivers... (1.89)%*
Average commission rate paid.......................... $0.0994
Portfolio turnover rate............................... 2.86%
+ Commencement of Operations, November 3, 1997.
* Annualized
** Total return does not reflect a 2.90% maximum sales charge.
10 See accompanying Notes to Financial Statements
<PAGE>
NOTE 1 -- DESCRIPTION OF FUND
The HomeState Group ("The Trust") , an open-end management company, was
established as a Pennsylvania common law trust on August 26, 1992, and is
registered under the Investment Company Act of 1940, as amended. The Trust
has established three series: the HomeState Pennsylvania Growth Fund, the
HomeState Select Opportunities Fund and The Year 2000 ("Y2K") Fund (each a
"Fund" and collectively, the "Funds"). Only the "Y2K" Fund is included in
this report. The investment objective of the Fund is set forth below.
The Y2K Fund commenced operations on October 31, 1997. The investment
objective of the Fund is long-term growth of capital by investing in equity
securities of public companies which have stated, or been reported as
possessing, an intention of developing or supporting marketable solutions to
problems stemming from the susceptibility of various business and other
computer application programs or systems to fail, or to produce inappropriate
results, regarding data, calculations or other processing involving dates
subsequent to December 31, 1999. To pursue its objective, the Fund will
invest at least 65% of its total assets in such companies.
NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies, in conformity
with generally accepted accounting principles, which were consistently
followed by each Fund in the preparation of their financial statements.
SECURITY VALUATION - Investment securities traded on a national securities
exchange are valued at the last reported sales price at 4:00 p.m. Eastern
time, unless there are no transactions on the valuation date, in which case
they are valued at the mean between the closing asked price and the closing
bid price. Securities traded over-the-counter are valued at the last reported
sales price unless there is no reported sales price, in which case the mean
between the closing asked price and the closing bid price is used. Debt
securities with maturities of sixty days or less are valued at amortized cost,
which approximates market value. Where market quotations are not readily
available, securities are valued using methods which the Board of Trustees
believe in good faith accurately reflects their fair value.
INCOME RECOGNITION - Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date.
SECURITIES TRANSACTIONS - Security transactions are accounted for on the date
the securities are purchased or sold. Realized gains and losses on securities
sold are determined using the identified cost method.
DISTRIBUTIONS TO SHAREHOLDERS - The Fund records distributions to shareholders
on the ex-dividend date. Net gains realized from securities transactions, if
any, will normally be distributed to shareholders in July and December. The
amounts of distributions from net investment income and net realized capital
gains are determined in accordance with federal income tax regulations, which
may differ from those amounts determined under generally accepted accounting
principles. These book/tax differences are either temporary or permanent in
nature. To the extent these differences are permanent, they are charged or
credited to paid-in capital in the period that the difference arises.
FEDERAL INCOME TAXES - The Fund intends to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies, including
the distribution of substantially all of its taxable income. Accordingly, no
provision for federal income taxes is considered necessary in the financial
statements.
USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS - The preparation
of financial statements in conformity with generally accepted accounting
<PAGE>
principles requires management to make estimates and assumptions that affect
the reported amount of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
CALL AND PUT OPTIONS - The Y2K Fund may write and/or purchase exchange-traded
call options and purchase exchange-traded put options on securities in the
Fund. When the Fund writes a call option, an amount equal to the premium
received is reflected as a liability. The amount of the liability is
subsequently "marked to market" to reflect the current market value of the
option written. If an option which the Fund has written either expires on its
stipulated expiration date, or if the Fund enters into a closing purchase
transaction, the Fund realizes a gain (or loss if the cost of the closing
transaction exceeds the premium received when the option is sold), and the
liability related to such option is extinguished. If a call option which the
Fund has written is exercised, the Fund realizes a gain or loss from the sale
of the underlying security, and the proceeds of which are increased by the
premium originally received.
The premium paid by the Fund for the purchase of a put option is recorded as
an investment and subsequently marked to market to reflect the current market
value of the option purchased. If an option which the Fund has purchased
expires on the stipulated expiration date, the Fund realizes a loss in the
amount of the cost of the option. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, the proceeds
of which are decreased by the premium originally paid. The Fund limits the
aggregate value of puts and call options to 25% of the Fund's net assets. At
December 31, 1997, the Year Y2K Fund had 6.1% of its net assets in
options/puts.
SHORT SALES - The Y2K Fund may sell securities short. Short sales are
transactions in which the Fund sells a security it does not own, in
anticipation of a decline in the market value of that security. To complete
such a transaction, the Fund must borrow the security to deliver to the buyer
upon the short sale; the Fund then is obligated to replace the security
borrowed by purchasing it in the open market at some later date. The Fund
will incur a loss if the market price of the security increases between the
date of the short sale and the date on which the Fund replaces the borrowed
security. The Fund will realize a gain if the security declines in value
between those dates. All short sales must be fully collateralized. The Fund
maintains the collateral in a segregated account consisting of cash, U.S.
Government securities or other liquid assets in an amount at least equal to
the market value of its short positions. The Fund limits the value of short
positions to 25% of the Fund's net assets. At December 31, 1997, the Fund had
0.4% of its net assets in short positions.
NOTE 3 -- CAPITAL STOCK
At December 31, 1997 the Fund had an authorized unlimited number of shares of
beneficial interest with no par value.
The following table summarizes the capital share transactions of the Fund:
For the Period November 3, 1997
(commencement of operations)
Through December 31, 1997 (unaudited)
Shares Amount
Sales....................... 241,532 $2,401,067
Redemptions................. (5,377) (53,885)
Net increase................ 236,155 $2,347,182
<PAGE>
NOTE 4 -- INVESTMENT TRANSACTIONS
During the period ended December 31, 1997, purchases and sales of investment
securities (excluding securities sold short and short-term investments) were
$2,121,223 and $28,509, respectively.
At December 31, 1997, net unrealized appreciation for Federal income tax
purposes aggregated $162,690, of which $230,468 related to appreciated
securities and $67,778 related to depreciated securities.
NOTE 5 -- EXPENSES AND TRANSACTIONS WITH AFFILIATED PARTIES
Emerald Advisers, Inc. serves as the investment adviser (the "Adviser") to the
Funds for which it receives investment advisory fees from each Fund. The fee
for the Y2K Fund is based on average daily net assets at the annual rate of
1.0% on assets up to and including $100 million, 0.90% for assets in excess of
$100 million. Under the terms of the investment advisory agreement which
expires on December 31, 1998, Emerald Advisers, Inc. may also voluntarily
reimburse the Funds for certain expenses. Through June 30, 1998, the Adviser
has voluntarily agreed to waive its advisory fee and/or reimburse other
expenses for the Y2K Fund to the extent that the Fund's total operating
expenses exceeds 2.90% of the average daily net assets of the Fund. At
December 31, 1997, Emerald Advisers, Inc. owned 100 shares of the Fund.
The following table summarizes the advisory fees and expense
waivers/reimbursements for the period ended December 31, 1997:
Gross Advisory Fee Reimbursement
Advisory waived From Adviser
$2,494 $2,494 $20,579
Pursuant to separate Administration, Accounting Services and Transfer Agency
Agreements with each Fund, Rodney Square Management Corporation ("RSMC"), a
wholly owned subsidiary of Wilmington Trust Company, serves as administrator,
accounting and transfer agent. During the period ending December 31, 1997, the
Fund incurred administration fees totaling $3,233, accounting service fees
totaling $6,466, and transfer agent fees totaling $4,443.
The Funds' Declaration of Trust provides that each Trustee affiliated with the
Funds' Adviser shall serve without compensation and each Trustee who is not so
affiliated shall receive fees from the income the Fund, and expense
reimbursements for each Trustees meeting attended. An unaffiliated Trustee's
annual fee shall not exceed $1,000. A member of the Funds' Board of Trustees
who is not affiliated with the Adviser is employed as a practicing attorney
and is a partner in the law firm of Duane, Morris & Heckscher, the Fund's
legal counsel. Legal fees aggregating $1,975, were paid to Duane, Morris &
Heckscher during the period ending December 31, 1997.
<PAGE>
================================================================================
The HomeState Group
INVESTMENT ADVISER BOARD OF TRUSTEES
------------------ ------------------
Emerald Advisers, Inc. Bruce E. Bowen
Lancaster, PA Kenneth G. Mertz II, CFA
Scott C. Penwell, Esq.
Scott L. Rehr
H. J. Zoffer, PhD
DISTRIBUTOR
-----------
Rodney Square Distributors, Inc.
Wilmington, DE FUND MANAGEMENT
---------------
Emerald Advisers, Inc.
ADMINISTRATOR AND 1857 William Penn Way
TRANSFER AGENT P.O. Box 10666
----------------- Lancaster, PA 17605
Rodney Square Management Corporation
Wilmington, DE
SHAREHOLDER SERVICES
--------------------
CUSTODIAN Rodney Square Management Corporation
--------- P.O. Box 8987
Wilmington Trust Company Wilmington, DE 19899-9752
Wilmington, DE
TELEPHONE NUMBERS
INDEPENDENT ACCOUNTANTS -----------------
----------------------- The Fund (800) 232-0224
Price Waterhouse LLP Marketing/Broker Services (800) 232-OK-PA
Philadelphia, PA Shareholder Services (800) 892-1351
LEGAL COUNSEL 24 HOUR PRICING INFORMATION
------------- ---------------------------
Duane, Morris & Heckscher 1-800-232-0224
Harrisburg, PA
This report is for the general information of Fund shareholders. For more
detailed information about the Fund, please consult a copy of the Fund's current
prospectus. This report is not authorized for distribution to prospective
investors in the Fund unless preceded or accompanied by a copy of the current
prospectus.
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