Company
|
Market Value
|
Percentage of Portfolio
|
||||||
|
||||||||
Federated Government Obligations Fund #5 Institutional
|
$
|
4,008,663
|
15.1
|
%
|
||||
|
||||||||
Gardner Denver Inc.
|
$
|
2,142,630
|
8.1
|
%
|
||||
|
||||||||
Berkshire Hathaway Inc.
|
$
|
1,902,640
|
7.2
|
%
|
||||
|
||||||||
Automatic Data Processing, Inc.
|
$
|
1,652,640
|
6.2
|
%
|
||||
|
||||||||
Sigma-Aldrich Corp.
|
$
|
1,286,720
|
4.8
|
%
|
||||
|
||||||||
Franklin Resources, Inc.
|
$
|
1,224,180
|
4.6
|
%
|
||||
|
||||||||
Hillenbrand, Inc.
|
$
|
1,209,210
|
4.6
|
%
|
||||
|
||||||||
The Chubb Corporation
|
$
|
1,185,100
|
4.5
|
%
|
||||
|
||||||||
Illinois Tool Works Inc.
|
$
|
1,175,890
|
4.4
|
%
|
||||
|
||||||||
Stryker Corp.
|
$
|
1,164,240
|
4.4
|
%
|
Company
|
Return on Equity
|
|||
Abbott Laboratories Inc.
|
22%
|
|
||
AFLAC Corp.
|
18%
|
|
||
Automatic Data Processing, Inc.
|
23%
|
|
||
Berkshire Hathaway Inc.
|
8%
|
|
||
The Chubb Corporation
|
10%
|
|
||
The Coca-Cola Company
|
28%
|
|
||
Colgate-Palmolive Co.
|
113%
|
|
||
Deere & Company
|
44%
|
|
||
Eaton Vance Corp.
|
33%
|
|
||
Emerson Electric Co.
|
19%
|
|
||
Franklin Resources, Inc.
|
21%
|
|
||
Gardner Denver Inc.
|
18%
|
|
||
Hillenbrand, Inc.
|
21%
|
|
||
Illinois Tool Works Inc.
|
27%
|
|
||
Johnson & Johnson
|
17%
|
|
||
Paychex, Inc.
|
32%
|
|
||
PepsiCo, Inc.
|
28%
|
|||
Sigma-Aldrich Corp.
|
18%
|
|
||
Stryker Corp.
|
15%
|
|
||
Waters Corp
|
31%
|
|
||
Wells Fargo & Company
|
11%
|
Luke E. Sims
|
David C. Sims
|
||
|
|
||
E-mail:
|
luke@simscapital.com |
E-mail:
|
dave@simscapital.com |
(O):
|
414/755-6790 |
(O):
|
414/765-1107 |
|
|
||
July 19, 2013
|
|
Assets
|
||||||||
|
||||||||
Common stock--at market value (cost $14,837,579)
|
$
|
22,539,100
|
||||||
Money market funds
|
4,008,663
|
|||||||
Short-term interest receivable
|
34
|
|||||||
Dividends receivable
|
33,235
|
|||||||
Prepaid fees
|
13,913
|
|||||||
|
$
|
26,594,945
|
||||||
Liabilities
|
||||||||
|
||||||||
Accounts payable
|
$
|
98
|
||||||
Accrued expenses
|
5,200
|
|||||||
Investment advisor fee payable
|
17,023
|
|||||||
|
$
|
22,321
|
||||||
|
||||||||
Total net assets
|
$
|
26,572,624
|
||||||
|
||||||||
Shareholders' Equity
|
||||||||
|
||||||||
Common stock- $0.001 par value per share;authorized 50,000,000 shares, outstanding 3,125,124 shares
|
$
|
3,125
|
||||||
Paid-in capital
|
17,312,453
|
|||||||
Undistributed net investment income
|
126,185
|
|||||||
Undistributed capital gains/losses
|
1,429,340
|
|||||||
Unrealized appreciation on investments
|
7,701,521
|
|||||||
|
||||||||
Shareholders' equity
|
$
|
26,572,624
|
||||||
|
||||||||
Net asset value per share
|
$
|
8.50
|
Investment Income
|
||||||||||||
|
||||||||||||
Dividends
|
$
|
169,123
|
||||||||||
Interest
|
278
|
|||||||||||
Total investment income
|
$
|
169,401
|
||||||||||
|
||||||||||||
Expenses
|
||||||||||||
|
||||||||||||
Advisory fees
|
$
|
97,109
|
||||||||||
Legal fees
|
3,578
|
|||||||||||
Insurance
|
6,248
|
|||||||||||
Transfer agent
|
12,937
|
|||||||||||
Directors’ fees and expenses
|
25,500
|
|||||||||||
Custodian fees
|
1,875
|
|||||||||||
Listing fee
|
7,439
|
|||||||||||
Other fees and expenses
|
14,275
|
|||||||||||
Total expenses
|
$
|
168,961
|
||||||||||
|
||||||||||||
Net investment income
|
$
|
440
|
||||||||||
|
||||||||||||
|
||||||||||||
Realized Gain and Unrealized Appreciation on Investments
|
||||||||||||
|
||||||||||||
Realized gain on investments:
|
||||||||||||
Proceeds from sale of investment securities
|
$
|
7,245,626
|
||||||||||
Less: cost of investment securities sold
|
5,816,285
|
|||||||||||
Net realized gain on investments
|
$
|
1,429,341
|
||||||||||
|
||||||||||||
Unrealized appreciation on investments:
|
||||||||||||
Unrealized appreciation at end of period
|
$
|
7,701,521
|
||||||||||
Less: unrealized appreciation at beginning of period
|
6,354,969
|
|||||||||||
Net change in unrealized appreciation on investments
|
$
|
1,346,552
|
||||||||||
Net realized gain and unrealized appreciation on investments
|
$
|
2,775,893
|
||||||||||
|
||||||||||||
Net increase (decrease) from operations
|
$
|
2,776,333
|
|
Year Ended
|
Six Months Ended
|
||||||
|
December 31, 2012
|
June 30, 2013
|
||||||
|
||||||||
From Operations:
|
||||||||
|
||||||||
Net investment income
|
$
|
196,835
|
$
|
440
|
||||
Net realized gain on investments
|
1,027,256
|
1,429,341
|
||||||
Net change in unrealized appreciation on investments
|
1,454,067
|
1,346,552
|
||||||
|
||||||||
Net increase (decrease) from operations
|
$
|
2,678,158
|
$
|
2,776,333
|
||||
|
||||||||
Distributions to Shareholders from:
|
||||||||
|
||||||||
Net investment income
|
(97,789
|
)
|
--
|
|||||
Net realized gain from investment transactions
|
(1,027,256
|
)
|
--
|
|||||
|
||||||||
Total distributions
|
$
|
(1,125,045
|
)
|
--
|
||||
|
||||||||
From Capital Stock Transactions:
|
||||||||
|
||||||||
Dividend reinvestment
|
--
|
--
|
||||||
Cash purchases
|
||||||||
Net increase from capital stock transactions
|
--
|
--
|
||||||
Increase (decrease) in net assets
|
--
|
--
|
||||||
|
||||||||
Total Net Assets:
|
||||||||
|
||||||||
Beginning of year
|
$
|
22,243,178
|
$
|
23,796,292
|
||||
End of period (including undistributed net investment income of $125,745 and $126,185)
|
$
|
23,796,292
|
$
|
26,572,624
|
||||
|
||||||||
|
||||||||
Shares:
|
||||||||
Shares issued to shareholders under the Dividend Reinvestment and Cash Purchase Plan
|
--
|
--
|
||||||
|
||||||||
Shares at beginning of year
|
3,125,124
|
3,125,124
|
||||||
Shares at end of period
|
3,125,124
|
3,125,124
|
For the years ended December 31:
|
2008
|
2009
|
2010
|
2011
|
2012
|
June 30, 2013
|
||||||||||||||||||
|
(six months)
|
|||||||||||||||||||||||
|
(unaudited)
|
|||||||||||||||||||||||
Net asset value at beginning of year
|
$
|
8.48
|
$
|
5.73
|
$
|
7.06
|
$
|
7.81
|
$
|
7.12
|
$
|
7.61
|
||||||||||||
|
||||||||||||||||||||||||
Net investment income
|
$
|
0.05
|
$
|
0.05
|
$
|
0.08
|
$
|
0.09
|
$
|
0.06
|
$
|
0.00
|
||||||||||||
Net realized gain and unrealized appreciation (loss) on investments
|
$
|
(2.45
|
)
|
$
|
1.33
|
$
|
0.95
|
$
|
0.27
|
$
|
0.79
|
$
|
0.89
|
|||||||||||
|
||||||||||||||||||||||||
Total from investment operations
|
$
|
(2.40
|
)
|
$
|
1.38
|
$
|
1.03
|
$
|
0.36
|
$
|
0.85
|
$
|
0.89
|
|||||||||||
|
||||||||||||||||||||||||
Distribution from:
|
||||||||||||||||||||||||
Net investment income
|
$
|
(0.05
|
)
|
$
|
(0.05
|
)
|
$
|
(0.08
|
)
|
$
|
(0.09
|
)
|
$
|
(0.03
|
)
|
$
|
0.00
|
|||||||
Realized gains
|
$
|
(0.30
|
)
|
$
|
(0.00
|
)
|
$
|
(0.20
|
)
|
$
|
(0.96
|
)
|
$
|
(0.33
|
)
|
$
|
0.00
|
|||||||
Total distributions
|
$
|
(0.35
|
)
|
$
|
(0.05
|
)
|
$
|
(0.28
|
)
|
$
|
(1.05
|
)
|
$
|
(0.36
|
)
|
$
|
0.00
|
|||||||
|
||||||||||||||||||||||||
Net asset value at end of period
|
$
|
5.73
|
$
|
7.06
|
$
|
7.81
|
$
|
7.12
|
$
|
7.61
|
$
|
8.50
|
||||||||||||
|
||||||||||||||||||||||||
Fund share market price, end of period last traded price (A)
|
$
|
5.00
|
$
|
6.39
|
$
|
6.62
|
$
|
7.00
|
$
|
7.10
|
$
|
7.70
|
||||||||||||
|
||||||||||||||||||||||||
Total Investment Return (B):
|
||||||||||||||||||||||||
Based on market value (annualized):
|
||||||||||||||||||||||||
1 Year
|
(34
|
%)
|
29
|
%
|
8
|
%
|
21
|
%
|
7
|
%
|
26
|
%
|
||||||||||||
5 Year
|
(4
|
%)
|
2
|
%
|
1
|
%
|
4
|
%
|
3
|
%
|
9
|
%
|
||||||||||||
10 Year
|
2
|
%
|
4
|
%
|
2
|
%
|
4
|
%
|
4
|
%
|
4
|
%
|
||||||||||||
From inception
|
7
|
%
|
8
|
%
|
8
|
%
|
8
|
%
|
8
|
%
|
9
|
%
|
||||||||||||
|
||||||||||||||||||||||||
Based on net asset value (annualized):
|
||||||||||||||||||||||||
1 Year
|
(28
|
%)
|
24
|
%
|
15
|
%
|
5
|
%
|
12
|
%
|
18
|
%
|
||||||||||||
5 Year
|
(3
|
%)
|
0
|
%
|
3
|
%
|
1
|
%
|
4
|
%
|
9
|
%
|
||||||||||||
10 Year
|
1
|
%
|
3
|
%
|
2
|
%
|
3
|
%
|
6
|
%
|
6
|
%
|
||||||||||||
From inception
|
8
|
%
|
8
|
%
|
9
|
%
|
8
|
%
|
9
|
%
|
9
|
%
|
||||||||||||
Net assets, end of year (000s omitted)
|
$
|
17,052
|
$
|
21,004
|
$
|
23,232
|
$
|
22,237
|
$
|
23,796
|
$
|
26,572
|
||||||||||||
Ratios to average net assets (C):
|
||||||||||||||||||||||||
Ratio of expenses to average net assets (annualized)
|
1.69
|
%
|
1.67
|
%
|
1.52
|
%
|
1.42
|
%
|
1.43
|
%
|
1.35
|
%
|
||||||||||||
Ratio of net investment income to average net assets (annualized)
|
0.74
|
%
|
0.84
|
%
|
1.09
|
%
|
1.14
|
%
|
0.83
|
%
|
0.00
|
%
|
||||||||||||
|
||||||||||||||||||||||||
Portfolio turnover
|
37
|
%
|
37
|
%
|
62
|
%
|
25
|
%
|
22
|
%
|
26
|
%
|
||||||||||||
Average commission paid per share
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
Common Stock (84.9% of total investments)
|
LEVEL ONE
|
|||||||||||||||
Industry
|
Shares
|
Cost
|
Market Value
|
% of Total Inv.
|
||||||||||||
Bank
|
||||||||||||||||
Wells Fargo & Company
|
15,000
|
$
|
597,750
|
$
|
619,050
|
|||||||||||
|
$
|
619,050
|
(2.3
|
%)
|
||||||||||||
Consumer
|
||||||||||||||||
The Coca-Cola Company
|
11,000
|
410,080
|
$
|
441,210
|
||||||||||||
Colgate-Palmolive Co.
|
12,000
|
72,938
|
687,480
|
|||||||||||||
PepsiCo, Inc.
|
10,000
|
168,296
|
817,900
|
|||||||||||||
Procter & Gamble Co.
|
4,000
|
239,680
|
307,960
|
|||||||||||||
|
$
|
2,254,550
|
(8.5
|
%)
|
||||||||||||
Data Processing
|
||||||||||||||||
Automatic Data Processing, Inc.
|
24,000
|
877,946
|
1,652,640
|
|||||||||||||
Paychex, Inc.
|
31,000
|
797,953
|
1,131,810
|
|||||||||||||
|
$
|
2,784,450
|
(10.5
|
%)
|
||||||||||||
Drug/Medical Device
|
||||||||||||||||
Abbott Laboratories Inc.
|
7,500
|
175,588
|
261,600
|
|||||||||||||
Johnson & Johnson
|
4,000
|
45,500
|
343,440
|
|||||||||||||
Stryker Corp.
|
18,000
|
82,375
|
1,164,240
|
|||||||||||||
|
$
|
1,769,280
|
(6.7
|
%)
|
||||||||||||
Industrial
|
||||||||||||||||
Deere & Company
|
14,000
|
1,191,784
|
1,137,500
|
|||||||||||||
Emerson Electric Co.
|
20,000
|
900,188
|
1,090,800
|
|||||||||||||
Gardner Denver Inc.
|
28,500
|
1,998,078
|
2,142,630
|
|||||||||||||
Hillenbrand, Inc.
|
51,000
|
987,591
|
1,209,210
|
|||||||||||||
Illinois Tool Works Inc.
|
17,000
|
786,916
|
1,175,890
|
|||||||||||||
Sigma-Aldrich Corp.
|
16,000
|
498,184
|
1,286,720
|
|||||||||||||
Waters Corp.*
|
6,000
|
302,341
|
600,300
|
|||||||||||||
|
$
|
8,643,050
|
(32.6
|
%)
|
||||||||||||
Insurance
|
||||||||||||||||
AFLAC Corp.
|
19,000
|
1,018,259
|
1,104,280
|
|||||||||||||
Berkshire Hathaway Inc.*
|
17,000
|
1,303,475
|
1,902,640
|
|||||||||||||
The Chubb Corporation
|
14,000
|
715,049
|
1,185,100
|
|||||||||||||
|
$
|
4,192,020
|
(15.8
|
%)
|
||||||||||||
Mutual Fund Managers
|
||||||||||||||||
Eaton Vance Corp.
|
28,000
|
607,484
|
1,052,520
|
|||||||||||||
Franklin Resources, Inc.
|
9,000
|
1,060,124
|
1,224,180
|
|||||||||||||
|
$
|
2,276,700
|
(8.6
|
%)
|
||||||||||||
|
||||||||||||||||
Total common stock investments
|
$
|
22,539,100
|
||||||||||||||
|
||||||||||||||||
Money Market Funds (15.1% of total investments)
|
LEVEL ONE
|
|||||||||||||||
|
Shares
|
Cost
|
Market Value
|
% of Total Inv.
|
||||||||||||
Federated Government Obligations Fund
|
4,008,663
|
4,008,663
|
$
|
4,008,663
|
||||||||||||
|
$
|
4,008,663
|
(15.1
|
%)
|
||||||||||||
|
||||||||||||||||
Total money market fund investments
|
4,008,663
|
|||||||||||||||
|
||||||||||||||||
Total investments
|
$
|
26,547,763
|
||||||||||||||
All other assets less liabilities
|
41,884
|
|||||||||||||||
|
||||||||||||||||
Accrued investment advisory fees
|
17,023
|
|||||||||||||||
Accrued director fees
|
0
|
|||||||||||||||
|
||||||||||||||||
Total net assets
|
$
|
26,572,624
|
(1) | Organization. |
(2) | Significant Accounting Policies. |
Gross unrealized appreciation
|
$
|
7,776,441
|
||
Gross unrealized depreciation
|
(74,920
|
)
|
||
Net unrealized appreciation
|
$
|
7,701,521
|
||
|
||||
Federal income tax basis
|
$ |
14,837,579
|
(3) | Certain Service Providers Arrangements. |
(4) | Dividend Reinvestment and Cash Purchase Plan. |
(5)
|
Distributions to Shareholders.
|
(6) | Fund Investment Transactions |
(7) | Financial Highlights. |
1. | To elect a Board of seven (7) Directors. |
2. | To ratify the selection of Plante & Moran, PLLC as the independent registered public accountants of the Fund for the calendar year ending December 31, 2013. |
Directors
|
Votes For
|
Votes Withheld
|
||||||
Robert M. Bilkie, Jr.
|
1,917,790
|
74,468
|
||||||
Phillip J. Hanrahan
|
1,875,884
|
116,374
|
||||||
Carl A. Holth
|
1,877,112
|
115,146
|
||||||
Peggy L. Schmeltz
|
1,922,350
|
69,909
|
||||||
Luke E. Sims
|
1,851,727
|
140,531
|
||||||
Donald G. Tyler
|
1,898,893
|
93,366
|
||||||
Neal F. Zalenko
|
1,894,578
|
97,681
|
For
|
Against
|
Abstain
|
||||||||
1,913,127
|
42,910
|
31,487
|
Name, Position
|
Aggregate
Compensation
From Fund
|
Pension or Retirement
Benefits Accrued as
part of Fund
Expenses
|
Estimated
Annual
Benefits upon
Retirement
|
Total
Compensation
from Fund and
Complex paid to
Directors
|
|
|
|
|
|
Luke E. Sims,
Director, President,
CEO
|
None
|
None
|
None
|
None
|
Name, Position
|
Aggregate
Compensation
From Fund
|
Pension or Retirement
Benefits Accrued as
part of Fund
Expenses
|
Estimated
Annual
Benefits upon
Retirement
|
Total
Compensation
from Fund and
Complex paid to
Directors
|
||||||
|
|
|
|
|
||||||
Robert M. Bilkie, Jr.,
|
|
|
||||||||
Director
|
$
|
4,000
|
None
|
None
|
$
|
4,000
|
||||
|
|
|
||||||||
Phillip J. Hanrahan
|
|
|
||||||||
Director
|
$
|
4,500
|
None
|
None
|
$
|
4,500
|
||||
|
|
|
||||||||
Carl A. Holth,
|
|
|
||||||||
Director
|
$
|
4,500
|
None
|
None
|
$
|
4,500
|
||||
|
|
|
||||||||
Peggy L. Schmeltz,
|
|
|
||||||||
Director
|
$
|
4,000
|
None
|
None
|
$
|
4,000
|
||||
|
|
|
||||||||
Donald G. Tyler,
|
|
|
||||||||
Director
|
$
|
4,000
|
None
|
None
|
$
|
4,000
|
||||
|
|
|
||||||||
Neal F. Zalenko,
|
|
|
||||||||
Director
|
$
|
4,500
|
None
|
None
|
$
|
4,500
|
Robert M. Bilkie, Jr.
|
Carl A. Holth
|
Phillip J. Hanrahan
|
Chairman of the Board
|
Director
|
Director
|
Southfield, MI
|
Clinton Township, MI
|
Whitefish Bay, WI
|
|
|
|
Peggy L. Schmeltz
|
Luke E. Sims
|
Donald G. Tyler
|
Director
|
President & Chief Executive Officer
|
Director
|
Bowling Green, OH
|
Milwaukee, WI
|
Shorewood, WI
|
|
|
|
Neal F. Zalenko
|
|
|
Director
|
|
|
Birmingham, MI
|
|
|
(a) | Not required for the semi-annual report. |
(b) | There have been no changes to the Fund’s Portfolio Managers. |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
|
|
|
|
/s/ Luke E. Sims
|
|
Luke E. Sims
|
|
President and Chief Executive Officer (principal executive officer)
|
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
|
|
/s/ David C. Sims
|
|
David C. Sims
|
|
Chief Financial Officer (principal financial officer)
|
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