SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / /
--
Pre-Effective Amendment No. / /
Post-Effective Amendment No. 12 /X/
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT / /
OF 1940
Amendment No. 13 /X/
(Check appropriate box or boxes.)
AmeriPrime Funds - File Nos. 33-96826 and 811-9096
1793 Kingswood Drive, Suite 200, Southlake, Texas 76092
- -------------------------------------------------------------------
(Address of Principal Executive Offices) Zip Code
Registrant's Telephone Number, including Area Code: (817) 431-2197
Kenneth Trumpfheller, 1793 Kingswood Drive, Suite 200, Southlake, Texas 76092
(Name and Address of Agent for Service)
With copy to:
Donald S. Mendelsohn, Brown, Cummins & Brown Co., L.P.A.
3500 Carew Tower, Cincinnati, Ohio 45202
Release Date: June, 1997
It is proposed that this filing will become effective:
/ / immediately upon filing pursuant to paragraph (b) / / on _____________
pursuant to paragraph (b) / / 60 days after filing pursuant to paragraph (a)(1)
/ / on (date) pursuant to paragraph (a)(1) /X/ 75 days after filing pursuant to
paragraph (a)(2) / / on (date) pursuant to paragraph (a)(2) of Rule 485.
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Title of Securities Being Registered
Omit from the facing sheet reference to the other Act if the
Registration Statement or amendment is filed under only one of the Acts. Include
the "Approximate Date of Proposed Public Offering" and "Title of Securities
Being Registered" only where securities are being registered under the
Securities Act of 1933.
ASA02D88-121197-1
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AmeriPrime Funds
CROSS REFERENCE SHEET
FORM N-1A
FOR MARATHON VALUE FUND
ITEM SECTION IN PROSPECTUS
1.............................. Cover Page
2.............................. Summary of Fund Expenses
3.............................. Financial Highlights
4.............................. The Funds, Investment Objective and
Strategies, Investment Policies and
Techniques and Risk Considerations,
Operation of the Fund, General
Information
5.............................. Operation of the Fund
5A............................. None
6.............................. Cover Page, Dividends and
Distributions, Taxes, Operation of
the Fund, General Information
7.............................. Cover Page, How to Invest in the
Fund, Share Price Calculation,
Operation of the Fund,
8.............................. How to Redeem Shares
9.............................. None
13.............................. General Information
15.............................. General Information
SECTION IN STATEMENT OF
ITEM ADDITIONAL INFORMATION
10.............................. Cover Page
11.............................. Table of Contents
12.............................. None
13.............................. Additional Information About Fund
Investments and Risk Considerations,
Investment Limitations
14.............................. Trustees and Officers
15.............................. None
16.............................. The Investment Adviser, Custodian,
Transfer Agent, Accountants
17.............................. Portfolio Transactions and Brokerage
18.............................. Description of the Trust
19.............................. Determination of Share Price
20.............................. None
21.............................. Distributor
22.............................. Investment Performance
23.............................. None
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Marathon Value Fund
702 W. Idaho Street
Suite 810
Boise, ID 83702
For Information, Shareholder Services and Requests:
(800) ______________
PROSPECTUS March ___, 1998
The investment objective of the Marathon Value Fund (the "Fund") is to
provide shareholders with maximum long term capital appreciation. The Fund's
advisor, Burroughs & Hutchinson, Inc. (the "Advisor"), seeks to achieve this
objective by investing in small and medium size companies that it believes to be
undervalued. These stocks are typically viewed as out-of-favor and have a share
price which does not reflect the intrinsic value of the company. The Advisor
believes its price driven, value-oriented approach will provide investors with
the opportunity for growth, while providing some protection against adverse
events.
The Fund is "no-load," which means that investors incur no sales charges,
commissions or deferred sales charges on the purchase or redemption of their
shares. The Fund is one of the mutual funds comprising AmeriPrime Funds, an
open-end management investment company, distributed by AmeriPrime Financial
Securities, Inc.
This Prospectus provides the information a prospective investor ought
to know before investing and should be retained for future reference. A
Statement of Additional Information dated has been filed with the Securities and
Exchange Commission (the "SEC"), is incorporated herein by reference, and can be
obtained without charge by calling the Fund at the phone number listed above.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
ASA02DCE-122297-1
<PAGE>
SUMMARY OF FUND EXPENSES
The tables below are provided to assist an investor in understanding
the direct and indirect expenses that an investor may incur as a shareholder in
the Fund. The expense information is based on estimated amounts for the current
fiscal year. The expenses are expressed as a percentage of average net assets.
The Example should not be considered a representation of future Fund performance
or expenses, both of which may vary.
Shareholders should be aware that the Fund is a no-load fund and,
accordingly, a shareholder does not pay any sales charge or commission upon
purchase or redemption of shares of the Fund. In addition, the Fund does not
have a 12b-1 Plan. Unlike most other mutual funds, the Fund does not pay
directly for transfer agency, pricing, custodial, auditing or legal services,
nor does it pay directly any general administrative or other significant
operating expenses. The Advisor pays all of the expenses of the Fund except
brokerage, taxes, interest, fees and expenses of non-interested person trustees
and extraordinary expenses.
Shareholder Transaction Expenses
Sales Load Imposed on Purchases.............................................NONE
Sales Load Imposed on Reinvested Dividends..................................NONE
Deferred Sales Load.........................................................NONE
Redemption Fees.............................................................NONE
Exchange Fees...............................................................NONE
Annual Fund Operating Expenses (as a percentage of average net assets)1
Management Fees............................................................1.48%
12b-1 Charges..............................................................0.00%
Other Expenses.............................................................0.00%
Total Fund Operating Expenses..............................................1.48%
1 The fund's total operating expenses are equal to the management fee paid
to the Advisor because the Advisor pays all of the Fund's operating expenses
(except as described in footnote 2)
2 The Fund estimates that other expenses (fees and expenses of the trustees
who are not "interested persons" as defined in the Investment Company Act) will
be less than .001% of average net assets.
The tables above are provided to assist an investor in understanding the direct
and indirect expenses that an investor may incur as a shareholder in the Fund.
<PAGE>
Example
You would pay the following expenses on a $1,000 investment, assuming (1) 5%
annual return and (2) redemption at the end of each time period:
1 Year 3 Years
------ -------
$ 15 $ 47
THE FUND
Marathon Value Fund (the "Fund") was organized as a series of
AmeriPrime Funds, an Ohio business trust (the "Trust"), on ____________________
and is expected to commence operations in March 1998. This prospectus offers
shares of the Fund and each share represents an undivided, proportionate
interest in the Fund. The investment advisor to the Fund is Burroughs &
Hutchinson, Inc. (the "Advisor").
INVESTMENT OBJECTIVE AND STRATEGIES AND RISK CONSIDERATIONS
The investment objective of the Fund is to provide shareholders with
maximum long term capital appreciation. The Advisor seeks to achieve this
objective by investing in small and medium size companies that it believes to be
undervalued. These stocks are typically viewed as out-of-favor and have a share
price which does not reflect the intrinsic value of the company. The Advisor
believes its price driven, value-oriented approach will provide investors with
the opportunity for growth, while providing some protection against adverse
events.
The Fund intends to invest primarily in equity securities of small and
mid-cap companies whose value has been ignored by other investors. These stocks
are typically found at the bottom of the rankings in terms of price-to-book
value, price-to-earnings or price-to-cash flow. These securities include
attractively priced, stable businesses that have not yet been discovered or
become popular, companies having a new catalyst for appreciation, companies that
have declined in value and lost their following, and previously popular
companies out of favor due to circumstances the Advisor believes to be
temporary.
The Advisor considers small capitalization companies to be those with a
market capitalization of less than $1 billion and mid-capitalization companies
to be those with the same capitalization ranges as companies in the Russell
Midcap Index. The Russell Midcap Index is an unmanaged index of equity
securities of companies which, as of June 30, 1997, ranged in capitalization
from $1 billion to $8 billion. It is expected that small-cap company securities
will range from 15% to 40%, and mid-cap company securities will range from 60%
to 85%, of the Fund's net assets. Investments in companies whose capitalizations
grow above the maximum capitalization level of the Russell Midcap Index may
continue to be held if they are deemed by the Advisor to be particularly
attractive.
The Advisor generally plans to stay fully invested (subject to
liquidity requirements) in common stocks, preferred stocks, and common stock
equivalents (such as securities convertible into common stocks), regardless of
price movements. For temporary defensive
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purposes, the Fund may hold all or a portion of its assets in money market
instruments, securities of other no-load registered investment companies or U.S.
government repurchase agreements. The Fund may also invest in such instruments
at any time to maintain liquidity or pending selection of investments in
accordance with its policies. If the Fund acquires securities of another
investment company, the shareholders of the Fund will be subject to additional
management fees.
By investing primarily in small and mid-capitalization companies, the
Fund will be subject to the risks associated with such companies. Smaller
capitalization companies may experience higher growth rates and higher failure
rates than do larger capitalization companies. Companies in which the Fund is
likely to invest may have limited product lines, markets or financial resources
and may lack management depth. The trading volume of securities of smaller
capitalization companies is normally less than that of larger capitalization
companies, and, therefore, may disproportionately affect their market price,
tending to make them rise more in response to buying demand and fall more in
response to selling pressure than is the case with larger capitalization
companies. The Advisor seeks to reduce risk by buying "cheap" stocks,
diversifying broadly and avoiding the institutional favorites.
As all investment securities are subject to inherent market risks and
fluctuations in value due to earnings, economic and political conditions and
other factors, the Fund cannot give any assurance that its investment objective
will be achieved. It should be noted that the Advisor has not previously managed
assets organized as a mutual fund and has no experience managing a portfolio
composed of small and mid-capitalization stocks. In addition, the Fund has no
operating history. Rates of total return quoted by the Fund may be higher or
lower than past quotations, and there can be no assurance that any rate of total
return will be maintained. See "Investment Policies and Techniques" for a more
detailed discussion of the Fund's investment practices.
HOW TO INVEST IN THE FUND
The Fund is "no-load" and shares of the Fund are sold directly to
investors on a continuous basis, subject to a minimum initial investment of
$2,500 and minimum subsequent investments of $100. These minimums may be waived
by the Advisor for accounts participating in an automatic investment program.
Investors choosing to purchase or redeem their shares through a broker/dealer or
other institution may be charged a fee by that institution. Investors choosing
to purchase or redeem shares directly from the Fund will not incur charges on
purchases or redemptions. To the extent investments of individual investors are
aggregated into an omnibus account established by an investment adviser, broker
or other intermediary, the account minimums apply to the omnibus account, not to
the account of the individual investor.
Initial Purchase
By Mail - You may purchase shares of the Fund by completing and signing
the investment application form which accompanies this Prospectus and mailing
it, in proper form, together with a check (subject to the above minimum amounts)
made payable to Marathon
<PAGE>
Value Fund, and sent to the address listed below.
U.S. Mail: Overnight:
Marathon Value Fund Marathon Value Fund
c/o American Data Services, Inc. c/o American Data Services,Inc.
P.O. Box 5536 Hauppauge Corporate Center
Hauppauge, New York 11788-0132 150 Motor Parkway
Hauppauge, New York 11760
Your purchase of shares of the Fund will be effected at the next share
price calculated after receipt of your investment.
By Wire - You may also purchase shares of the Fund by wiring federal
funds from your bank, which may charge you a fee for doing so. If money is to be
wired, you must call the Transfer Agent at (800) ______________ to set up your
account and obtain an account number. You should be prepared at that time to
provide the information on the application. Then, you should provide your bank
with the following information for purposes of wiring your investment:
Star Bank, N.A. Cinti/Trust
ABA #0420-0001-3
Attn: Marathon Value Fund
D.D.A. #485777197
Account Name _________________ (write in shareholder
name) For the Account # ______________ (write in
account number)
You are required to mail a signed application to the Custodian at the above
address in order to complete your initial wire purchase. Wire orders will be
accepted only on a day on which the Fund, Custodian and Transfer Agent are open
for business. A wire purchase will not be considered made until the wired money
is received and the purchase is accepted by the Fund. Any delays which may occur
in wiring money, including delays which may occur in processing by the banks,
are not the responsibility of the Fund or the Transfer Agent. There is presently
no fee for the receipt of wired funds, but the right to charge shareholders for
this service is reserved by the Fund.
Additional Investments
You may purchase additional shares of the Fund at any time (subject to
minimum investment requirements) by mail, wire, or automatic investment. Each
additional mail purchase request must contain your name, the name of your
account(s), your account number(s), and the name of the Fund. Checks should be
made payable to Marathon Value Fund and should be sent to the address listed
above. A bank wire should be sent as outlined above.
<PAGE>
Automatic Investment Plan
You may make regular investments in the Fund with an Automatic
Investment Plan by completing the appropriate section of the account application
and attaching a voided personal check. Investments may be made monthly to allow
dollar-cost averaging by automatically deducting $100 or more from your bank
checking account. You may change the amount of your monthly purchase at any
time.
Tax Sheltered Retirement Plans
Since the Fund is oriented to longer term investments, shares of the
Fund may be an appropriate investment medium for tax sheltered retirement plans,
including: individual retirement plans (IRAs); simplified employee pensions
(SEPs); SIMPLE plans; 401(k) plans; qualified corporate pension and profit
sharing plans (for employees); tax deferred investment plans (for employees of
public school systems and certain types of charitable organizations); and other
qualified retirement plans. You should contact the Transfer Agent for the
procedure to open an IRA or SEP plan, as well as more specific information
regarding these retirement plan options. Consultation with an attorney or tax
advisor regarding these plans is advisable. Custodial fees for an IRA will be
paid by the shareholder by redemption of sufficient shares of the Fund from the
IRA unless the fees are paid directly to the IRA custodian. You can obtain
information about the IRA custodial fees from the Transfer Agent.
Other Purchase Information
Dividends begin to accrue after you become a shareholder. The Fund does
not issue share certificates. All shares are held in non-certificate form
registered on the books of the Fund and the Fund's Transfer Agent for the
account of the shareholder. The rights to limit the amount of purchases and to
refuse to sell to any person are reserved by the Fund. If your check or wire
does not clear, you will be responsible for any loss incurred by the Fund. If
you are already a shareholder, the Fund can redeem shares from any identically
registered account in the Fund as reimbursement for any loss incurred. You may
be prohibited or restricted from making future purchases in the Fund.
HOW TO REDEEM SHARES
All redemptions will be made at the net asset value determined after
the redemption request has been received by the Transfer Agent in proper order.
Shareholders may receive redemption payments in the form of a check or federal
wire transfer. The proceeds of the redemption may be more or less than the
purchase price of your shares, depending on the market value of the Fund's
securities at the time of your redemption. Presently there is no charge for wire
redemptions; however, the Fund reserves the right to charge for this service.
Any charges for wire redemptions will be deducted from the shareholder's Fund
account by redemption of shares. Investors choosing to purchase or redeem their
shares through a securities dealer may be charged a fee by that institution.
<PAGE>
By Mail - You may redeem any part of your account in the Fund at no
charge by mail. Your request should be addressed to:
Marathon Value Fund
c/o American Data Services, Inc.
P.O. Box 5536
Hauppauge, New York 11788-0132
"Proper order" means your request for a redemption must include your
letter of instruction, including the Fund name, account number, account name(s),
the address and the dollar amount or number of shares you wish to redeem. This
request must be signed by all registered share owner(s) in the exact name(s) and
any special capacity in which they are registered. For all redemptions, the Fund
requires that signatures be guaranteed by a bank or member firm of a national
securities exchange. Signature guarantees are for the protection of
shareholders. At the discretion of the Fund or American Data Services, Inc., a
shareholder, prior to redemption, may be required to furnish additional legal
documents to insure proper authorization.
By Telephone - You may redeem any part of your account in the Fund by
calling the Transfer Agent at (800) ______________. You must first complete the
Optional Telephone Redemption and Exchange section of the investment application
to institute this option. The Fund, the Transfer Agent and the Custodian are not
liable for following redemption or exchange instructions communicated by
telephone that they reasonably believe to be genuine. However, if they do not
employ reasonable procedures to confirm that telephone instructions are genuine,
they may be liable for any losses due to unauthorized or fraudulent
instructions. Procedures employed may include recording telephone instructions
and requiring a form of personal identification from the caller.
The telephone redemption and exchange procedures may be terminated at any
time by the Fund or the Transfer Agent. During periods of extreme market
activity it is possible that shareholders may encounter some difficulty in
telephoning the Fund, although neither the Fund nor the Transfer Agent has ever
experienced difficulties in receiving and in a timely fashion responding to
telephone requests for redemptions or exchanges. If you are unable to reach the
Fund by telephone, you may request a redemption or exchange by mail.
Additional Information - If you are not certain of the requirements for a
redemption please call the Transfer Agent at (800) ______________. Redemptions
specifying a certain date or share price cannot be accepted and will be
returned. You will be mailed the proceeds on or before the fifth business day
following the redemption. However, payment for redemption made against shares
purchased by check will be made only after the check has been collected, which
normally may take up to fifteen days. Also, when the New York Stock Exchange is
closed (or when trading is restricted) for any reason other than its customary
weekend or holiday closing or under any emergency circumstances, as determined
by the Securities and Exchange Commission, the Fund may suspend redemptions or
postpone payment dates.
<PAGE>
Because the Fund incurs certain fixed costs in maintaining shareholder
accounts, the Fund reserves the right to require any shareholder to redeem all
of his or her shares in the Fund on 30 days' written notice if the value of his
or her shares in the Fund is less than $2,500 due to redemption, or such other
minimum amount as the Fund may determine from time to time. An involuntary
redemption constitutes a sale. You should consult your tax advisor concerning
the tax consequences of involuntary redemptions. A shareholder may increase the
value of his or her shares in the Fund to the minimum amount within the 30 day
period. Each share of the Fund is subject to redemption at any time if the Board
of Trustees determines in its sole discretion that failure to so redeem may have
materially adverse consequences to all or any of the shareholders of the Fund.
SHARE PRICE CALCULATION
The value of an individual share in the Fund (the net asset value) is
calculated by dividing the total value of the Fund's investments and other
assets (including accrued income), less any liabilities (including estimated
accrued expenses), by the number of shares outstanding, rounded to the nearest
cent. Net asset value per share is determined as of the close of the New York
Stock Exchange (4:00 p.m., Eastern time) on each day that the exchange is open
for business, and on any other day on which there is sufficient trading in the
Fund's securities to materially affect the net asset value. The net asset value
per share of the Fund will fluctuate.
Securities which are traded on any exchange or on the NASDAQ
over-the-counter market are valued at the last quoted sale price. Lacking a last
sale price, a security is valued at its last bid price except when, in the
Advisor's opinion, the last bid price does not accurately reflect the current
value of the security. All other securities for which over-the-counter market
quotations are readily available are valued at their last bid price. When market
quotations are not readily available, when the Advisor determines the last bid
price does not accurately reflect the current value or when restricted
securities are being valued, such securities are valued as determined in good
faith by the Advisor, subject to review of the Board of Trustees of the Trust.
Fixed income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Advisor,
subject to review of the Board of Trustees. Short term investments in fixed
income securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
<PAGE>
DIVIDENDS AND DISTRIBUTIONS
The Fund intends to distribute substantially all of its net investment
income as dividends to its shareholders on an annual basis, and intends to
distribute its net long term capital gains and its net short term capital gains
at least once a year.
Income dividends and capital gain distributions are automatically
reinvested in additional shares at the net asset value per share on the
distribution date. An election to receive a cash payment of dividends and/or
capital gain distributions may be made in the application to purchase shares or
by separate written notice to the Transfer Agent. Shareholders will receive a
confirmation statement reflecting the payment and reinvestment of dividends and
summarizing all other transactions. If cash payment is requested, a check
normally will be mailed within five business days after the payable date. If you
withdraw your entire account, all dividends accrued to the time of withdrawal,
including the day of withdrawal, will be paid at that time. You may elect to
have distributions on shares held in IRAs and 403(b) plans paid in cash only if
you are 59 1/2 years old or permanently and totally disabled or if you otherwise
qualify under the applicable plan.
TAXES
The Fund intends to qualify each year as a "regulated investment company"
under the Internal Revenue Code of 1986, as amended. By so qualifying, the Fund
will not be subject to federal income taxes to the extent that it distributes
substantially all of its net investment income and any realized capital gains.
For federal income tax purposes, dividends paid by the Fund from ordinary
income are taxable to shareholders as ordinary income, but may be eligible in
part for the dividends received deduction for corporations. Pursuant to the Tax
Reform Act of 1986 (the "Tax Reform Act"), all distributions of net short term
capital gains to individuals are taxed at the same rate as ordinary income. All
distributions of net capital gains to corporations are taxed at regular
corporate rates. Any distributions designated as being made from net realized
long term capital gains are taxable to shareholders as long term capital gains
regardless of the holding period of the shareholder.
The Fund will mail to each shareholder after the close of the calendar
year a statement setting forth the federal income tax status of distributions
made during the year. Dividends and capital gains distributions may also be
subject to state and local taxes. Shareholders are urged to consult their own
tax advisors regarding specific questions as to federal, state or local taxes
and the tax effect of distributions and withdrawals from the Fund.
On the application or other appropriate form, the Fund will request the
shareholder's certified taxpayer identification number (social security number
for individuals) and a certification that the shareholder is not subject to
backup withholding. Unless the shareholder provides this information, the Fund
will be required to withhold and remit to the U.S. Treasury 31% of the
dividends, distributions and redemption proceeds payable to
<PAGE>
the shareholder. Shareholders should be aware that, under regulations
promulgated by the Internal Revenue Service, the Fund may be fined $50 annually
for each account for which a certified taxpayer identification number is not
provided. In the event that such a fine is imposed with respect to a specific
account in any year, the Fund may make a corresponding charge against the
account.
OPERATION OF THE FUND
The Fund is a diversified series of AmeriPrime Funds, an open-end
management investment company organized as an Ohio business trust on August 8,
1995. The Board of Trustees supervises the business activities of the Fund. Like
other mutual funds, the Fund retains various organizations to perform
specialized services.
The Fund retains Burroughs & Hutchinson, Inc. 702 W. Idaho Street, Suite
810, Boise, ID 83702 (the "Advisor") to manage the Fund's investments. Burroughs
& Hutchinson has been providing portfolio management services since its founding
in 1967 by A.H. Burroughs III. The Advisor provides equity, balanced and fixed
income portfolio management services to a select group of corporations,
institutions, foundations, trusts and high net worth individuals. The Advisor
currently manages over $240 million in assets for clients.
Mark Matsko is primarily responsible for the day-to-day management of the
Fund's portfolio. A graduate of the University of Montana in 1980 with a B.S.
degree in accounting, he passed his CPA exam and worked as a tax accountant at
Arthur Andersen & Co. After leaving Arthur Andersen, he worked for and became
president of Great Falls Coca-Cola. A Chartered Financial Analyst (CFA), his
work in the investment business during the last ten years has included positions
as a broker, a security analyst, and manager of his own hedge fund. Mr. Matsko
joined Burroughs & Hutchinson in 1986.
The Fund is authorized to pay the Advisor a fee equal to an annual average
rate of 1.48% of its average daily net assets. The Advisor pays all of the
operating expenses of the Fund except brokerage, taxes, interest , fees and
expenses of non-interested person trustees and extraordinary expenses. In this
regard, it should be noted that most investment companies pay their own
operating expenses directly, while the Fund's expenses, except those specified
above, are paid by the Advisor.
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Fund's business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment,
personnel and facilities. The Administrator receives a monthly fee from the Fund
equal to an annual average rate of 0.10% of the Fund's average daily net assets
up to fifty million dollars, 0.075% of the Fund's average daily net assets from
fifty to one hundred million dollars and 0.050% of the Fund's average daily net
assets over one hundred million dollars (subject to a minimum annual payment of
$30,000). In addition, the Advisor will reimburse the Administrator for
organizational expenses advanced by the Administrator. The Fund retains American
Data Services, Inc., 24 West Carver Street, Huntington, New York 11743 (the
"Transfer Agent") to serve as transfer agent, dividend paying agent and
shareholder service agent. The Trust retains AmeriPrime Financial Securities,
Inc., 1793 Kingswood Drive, Suite 200, Southlake,
<PAGE>
Texas 76092 (the "Distributor") to act as the principal distributor of the
Fund's shares. Kenneth D. Trumpfheller, officer and sole shareholder of the
Administrator and the Distributor, is an officer and trustee of the Trust. The
services of the Administrator, Transfer Agent and Distributor are operating
expenses paid by the Advisor.
Consistent with the Rules of Fair Practice of the National Association of
Securities Dealers, Inc., and subject to its obligation of seeking best
qualitative execution, the Advisor may give consideration to sales of shares of
the Fund as a factor in the selection of brokers and dealers to execute
portfolio transactions. The advisor (not the fund) may pay certain financial
institutions (which may include banks, brokers, securities dealers and other
industry professionals) a "servicing fee" for performing certain administrative
functions for Fund shareholders to the extent these institutions are allowed to
do so by applicable statute, rule or regulation.
INVESTMENT POLICIES AND TECHNIQUES
This section contains general information about various types of
securities and investment techniques that the Fund may purchase or employ.
Equity Securities
The fund will invest primarily in U.S. equity securities consisting of
common stock, convertible debt, preferred stock, warrants or other securities
exchangeable for shares of common stock, and other equity securities, including
real estate investment trusts. Although equity securities have a history of
long-term growth in value, their prices fluctuate based on changes in a
company's financial condition and on overall market and economic conditions.
Smaller companies are especially sensitive to these factors. Under normal
circumstances, the Fund intends to invest primarily in equity securities of
small and mid-capitalization issuers. Although the Fund intends to invest
primarily in U.S. common stocks, the Advisor reserves the right to invest in
short-term cash equivalent securities, either for temporary defensive purposes,
or as part of the Fund's overall strategy.
Investment Techniques and Other Investments
The Fund may invest up to 5% of its net assets in repurchase agreements
fully collateralized by U.S. Government obligations. The Fund may buy and sell
securities on a when-issued or delayed delivery basis, with payment and delivery
taking place at a future date, but investment in such securities may not exceed
5% of the Fund's net assets. The Fund may buy and write put and call options,
provided the Fund's investment in options does not exceed 5% of its net assets,
and may invest up to 5% of its net assets in indexed securities. The Fund will
not invest more than 5% of its net assets in illiquid securities, including
repurchase agreements maturing in more than seven days. Also limited to 5% of
the Fund's net assets is the Fund's investment in STRIPs (Separate Trading of
Registered Interest and Principal of Securities). The Federal Reserve creates
STRIPs by separating the coupon payments and the principal payments from the
outstanding Treasury security and selling them as individual securities.
<PAGE>
Loans of Portfolio Securities
The Fund may make short and long term loans of its portfolio securities.
Under the lending policy authorized by the Board of Trustees and implemented by
the Advisor in response to requests of broker-dealers or institutional investors
which the Advisor deems qualified, the borrower must agree to maintain
collateral, in the form of cash or U.S. government obligations, with the Fund on
a daily mark-to-market basis in an amount at least equal to 100% of the value of
the loaned securities. The Fund will continue to receive dividends or interest
on the loaned securities and may terminate such loans at any time or reacquire
such securities in time to vote on any matter which the Board of Trustees
determines to be important. With respect to loans of securities, there is the
risk that the borrower may fail to return the loaned securities or that the
borrower may not be able to provide additional collateral.
GENERAL INFORMATION
Fundamental Policies. The investment limitations set forth in the
Statement of Additional Information as fundamental policies may not be changed
without the affirmative vote of the majority of the outstanding shares of the
Fund. The investment objective of the Fund may be changed without the
affirmative vote of a majority of the outstanding shares of the Fund. Any such
change may result in the Fund having an investment objective different from the
objective which the shareholders considered appropriate at the time of
investment in the Fund.
Portfolio Turnover. The Fund does not intend to purchase or sell
securities for short term trading purposes. The Fund will, however, sell any
portfolio security (without regard to the length of time it has been held) when
the Advisor believes that market conditions, creditworthiness factors or general
economic conditions warrant such action. It is anticipated that the Fund will
have a portfolio turnover rate of less than 100%.
Shareholder Rights. Any Trustee of the Trust may be removed by vote of the
shareholders holding not less than two-thirds of the outstanding shares of the
Trust. The Trust does not hold an annual meeting of shareholders. When matters
are submitted to shareholders for a vote, each shareholder is entitled to one
vote for each whole share he owns and fractional votes for fractional shares he
owns. All shares of the Fund have equal voting rights and liquidation rights.
Prior to the offering made by this Prospectus, ________________ purchased for
investment all of the outstanding shares of the Fund. As a result,
____________________ may be deemed to control the Fund.
PERFORMANCE INFORMATION
The Fund may periodically advertise "average annual total return." The
"average annual total return" of the Fund refers to the average annual
compounded rate of return over the stated period that would equate an initial
amount invested at the beginning of a stated period to the ending redeemable
value of the investment. The calculation of "average
<PAGE>
annual total return" assumes the reinvestment of all dividends and
distributions.
The Fund may also periodically advertise its total return over various
periods in addition to the value of a $10,000 investment (made on the date of
the initial public offering of the Fund's shares) as of the end of a specified
period. The "total return" for the Fund refers to the percentage change in the
value of an account between the beginning and end of the stated period, assuming
no activity in the account other than reinvestment of dividends and capital
gains distributions.
The Fund may also include in advertisements data comparing performance
with other mutual funds as reported in non-related investment media, published
editorial comments and performance rankings compiled by independent
organizations and publications that monitor the performance of mutual funds
(such as Lipper Analytical Services, Inc., Morningstar, Inc., Fortune or
Barron's). Performance information may be quoted numerically or may be presented
in a table, graph or other illustration. In addition, Fund performance may be
compared to well-known indices of market performance including the Russell
Mid-Cap Index.
The advertised performance data of the Fund is based on historical
performance and is not intended to indicate future performance. Rates of total
return quoted by the Fund may be higher or lower than past quotations, and there
can be no assurance that any rate of total return will be maintained. The
principal value of an investment in the Fund will fluctuate so that a
shareholder's shares, when redeemed, may be worth more or less than the
shareholder's original investment.
<PAGE>
Investment Advisor Administrator
Burroughs & Hutchinson, Inc. AmeriPrime Financial Services, Inc.
702 W. Idaho Street 1793 Kingswood Drive, Suite 200
Suite 810 Southlake, Texas 76092
Boise, ID 83702
Custodian Distributor
Star Bank, N.A. AmeriPrime Financial Services, Inc.
P.O. Box 1118 1793 Kingswood Drive, Suite 200
Cincinnati, Ohio 45201 Southlake, Texas 76092
Transfer Agent (all purchases and Independent Auditors
all redemption requests) McCurdy & Associates CPA's, Inc.
American Data Services, Inc. 27955 Clemens Road
Hauppauge Corporate Center Westlake, Ohio 44145
150 Motor Parkway
Hauppauge, New York 11760
No person has been authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering contained in this Prospectus, and if given or made, such
information or representations must not be relied upon as being authorized by
the Fund. This Prospectus does not constitute an offer by the Fund to sell its
shares in any state to any person to whom it is unlawful to make such offer in
such state.
<PAGE>
TABLE OF CONTENTS Page
SUMMARY OF FUND EXPENSES.....................................................
Shareholder Transaction Expenses....................................
Annual Fund Operating Expenses......................................
THE FUND.....................................................................
INVESTMENT OBJECTIVE AND STRATEGIES AND RISK CONSIDERATIONS..................
HOW TO INVEST IN THE FUND....................................................
Initial Purchase....................................................
Additional Investments..............................................
Automatic Investment Plan...........................................
Tax Sheltered Retirement Plans......................................
Other Purchase Information..........................................
HOW TO REDEEM SHARES.........................................................
By Mail.............................................................
By Telephone........................................................
Additional Information..............................................
SHARE PRICE CALCULATION......................................................
DIVIDENDS AND DISTRIBUTIONS..................................................
TAXES........................................................................
OPERATION OF THE FUND........................................................
INVESTMENT POLICIES AND TECHNIQUES ..........................................
Equity Securities..................................................
Investment Techniques and Other Investments .......................
Loans of Portfolio Securities
GENERAL INFORMATION.........................................................
Fundamental Policies..............................................
Portfolio Turnover.................................................
Shareholder Rights.................................................
PERFORMANCE INFORMATION.....................................................
............................................................................
............................................................................
<PAGE>
MARATHON VALUE FUND
STATEMENT OF ADDITIONAL INFORMATION
March ___, 1998
This Statement of Additional Information is not a prospectus. It should
be read in conjunction with the Prospectus of Marathon Value Fund dated March
__, 1998. A copy of the Prospectus can be obtained by writing the Transfer Agent
at Hauppauge Corporate Center, 150 Motor Parkwat, Hauppauge New York 11760, or
by calling (800) ___-____.
ASA02DC4-122297-3
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
TABLE OF CONTENTS
PAGE
DESCRIPTION OF THE TRUST....................................................
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND
RISK
CONSIDERATIONS.............................................................
INVESTMENT LIMITATIONS......................................................
THE INVESTMENT ADVISOR......................................................
TRUSTEES AND OFFICERS.......................................................
PORTFOLIO TRANSACTIONS AND BROKERAGE........................................
DETERMINATION OF SHARE PRICE................................................
INVESTMENT PERFORMANCE......................................................
CUSTODIAN...................................................................
TRANSFER AGENT..............................................................
ACCOUNTANTS.................................................................
DISTRIBUTOR.................................................................
<PAGE>
DESCRIPTION OF THE TRUST
Marathon Value Fund (the "Fund") was organized as a series of
AmeriPrime Funds (the "Trust"). The Trust is an open-end investment company
established under the laws of Ohio by an Agreement and Declaration of Trust
dated August 8, 1995 (the "Trust Agreement"). The Trust Agreement permits the
Trustees to issue an unlimited number of shares of beneficial interest of
separate series without par value. The Fund is one of a series of funds
currently authorized by the Trustees.
Each share of a series represents an equal proportionate interest in
the assets and liabilities belonging to that series with each other share of
that series and is entitled to such dividends and distributions out of income
belonging to the series as are declared by the Trustees. The shares do not have
cumulative voting rights or any preemptive or conversion rights, and the
Trustees have the authority from time to time to divide or combine the shares of
any series into a greater or lesser number of shares of that series so long as
the proportionate beneficial interest in the assets belonging to that series and
the rights of shares of any other series are in no way affected. In case of any
liquidation of a series, the holders of shares of the series being liquidated
will be entitled to receive as a class a distribution out of the assets, net of
the liabilities, belonging to that series. Expenses attributable to any series
are borne by that series. Any general expenses of the Trust not readily
identifiable as belonging to a particular series are allocated by or under the
direction of the Trustees in such manner as the Trustees determine to be fair
and equitable. No shareholder is liable to further calls or to assessment by the
Trust without his or her express consent.
For information concerning the purchase and redemption of shares of the
Fund, see "How to Invest in the Fund" and "How to Redeem Shares" in the Fund's
Prospectus. For a description of the methods used to determine the share price
and value of the Fund's assets, see "Share Price Calculation" in the Fund's
Prospectus.
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK
CONSIDERATIONS
This section contains a more detailed discussion of some of the
investments the Fund may make and some of the techniques it may use, as
described in the Prospectus (see "Investment Objectives and Strategies" and
"Investment Policies and Techniques and Risk Considerations").
A. Equity Securities. Equity securities include common stock, preferred
stock and common stock equivalents (such as convertible preferred stock, rights
and warrants). Convertible preferred stock is preferred stock that can be
converted into common stock pursuant to its terms. Warrants are options to
purchase equity securities at a specified price valid for a specific time
period. Rights are similar to warrants, but normally have a short duration and
are distributed by the issuer to its shareholders. The Fund may invest up to 5%
of its net assets at the time of purchase in each of the following: rights,
warrants, or convertible preferred stocks.
<PAGE>
B. Repurchase Agreements. A repurchase agreement is a short-term
investment in which the purchaser (i.e., the Fund) acquires ownership of a U.S.
Government obligation (which may be of any maturity) and the seller agrees to
repurchase the obligation at a future time at a set price, thereby determining
the yield during the purchaser's holding period (usually not more than seven
days from the date of purchase). Any repurchase transaction in which the Fund
engages will require full collateralization of the seller's obligation during
the entire term of the repurchase agreement. In the event of a bankruptcy or
other default of the seller, the Fund could experience both delays in
liquidating the underlying security and losses in value. However, the Fund
intends to enter into repurchase agreements only with the Custodian, other banks
with assets of $1 billion or more and registered securities dealers determined
by the Advisor (subject to review by the Board of Trustees) to be creditworthy.
The Advisor monitors the creditworthiness of the banks and securities dealers
with which the Fund engages in repurchase transactions, and the Fund will not
invest more than 5% of its net assets in repurchase agreements.
C. When Issued Securities and Forward Commitments. The Fund may buy and
sell securities on a when-issued or delayed delivery basis, with payment and
delivery taking place at a future date. The price and interest rate that will be
received on the securities are each fixed at the time the buyer enters into the
commitment. The Fund may enter into such forward commitments if the Fund holds,
and maintains until the settlement date in a separate account at the Fund's
Custodian, cash or U.S. government securities in an amount sufficient to meet
the purchase price. The Fund will not invest more than 5% of its total assets in
forward commitments. Forward commitments involve a risk of loss if the value of
the security to be purchased declines prior to the settlement date. Any change
in value could increase fluctuations in the Fund's share price and yield.
Although the Fund will generally enter into forward commitments with the
intention of acquiring securities for its portfolio, the Fund may dispose of a
commitment prior to the settlement if the Advisor deems it appropriate to do so.
D. STRIPS. The Federal Reserve creates STRIPS (Separate Trading of
Registered Interest and Principal of Securities) by separating the coupon
payments and the principal payment from an outstanding Treasury security and
selling them as individual securities. To the extent the Fund purchases the
principal portion of the STRIP, the Fund will not receive regular interest
payments. Instead they are sold at a deep discount from their face value. The
Fund will accrue income on such STRIPS for tax and accounting purposes, in
accordance with applicable law, which income is distributable to shareholders.
Because no cash is received at the time such income is accrued, the Fund may be
required to liquidate other portfolio securities to satisfy its distribution
obligations. Because the principal portion of the STRIP does not pay current
income, its price can be very volatile when interest rates change. In
calculating its dividend, the Fund takes into account as income a portion of the
difference between the principal portion of the STRIP's purchase price and its
face value. The Fund will not invest more than 5% of its net assets in STRIPS.
<PAGE>
E. Illiquid Securities. The portfolio of the Fund may contain illiquid
securities. Illiquid securities generally include securities which cannot be
disposed of promptly and in the ordinary course of business without taking a
reduced price. Securities may be illiquid due to contractual or legal
restrictions on resale or lack of a ready market. The following securities are
considered to be illiquid: repurchase agreements maturing in more than seven
days, nonpublicly offered securities and restricted securities. Restricted
securities are securities the resale of which is subject to legal or contractual
restrictions. Restricted securities may be sold only in privately negotiated
transactions, in a public offering with respect to which a registration
statement is in effect under the Securities Act of 1933 or pursuant to Rule 144
or Rule 144A promulgated under such Act. Where registration is required, the
Fund may be obligated to pay all or part of the registration expense, and a
considerable period may elapse between the time of the decision to sell and the
time such security may be sold under an effective registration statement. If
during such a period adverse market conditions were to develop, the Fund might
obtain a less favorable price than the price it could have obtained when it
decided to sell. The Fund will not invest more than 5% of its net assets in
illiquid securities.
F. Option Transactions. Up to 5% of the Fund's net assets may be
invested in option transactions involving individual securities and market
indices. An option involves either (a) the right or the obligation to buy or
sell a specific instrument at a specific price until the expiration date of the
option, or (b) the right to receive payments or the obligation to make payments
representing the difference between the closing price of a market index and the
exercise price of the option expressed in dollars times a specified multiple
until the expiration date of the option. Options are sold (written) on
securities and market indices. The purchaser of an option on a security pays the
seller (the writer) a premium for the right granted but is not obligated to buy
or sell the underlying security. The purchaser of an option on a market index
pays the seller a premium for the right granted, and in return the seller of
such an option is obligated to make the payment. A writer of an option may
terminate the obligation prior to expiration of the option by making an
offsetting purchase of an identical option. Options are traded on organized
exchanges and in the over-the-counter market. Options on securities which the
Fund sells (writes) will be covered or secured, which means that it will own the
underlying security (for a call option); will segregate with the Custodian high
quality liquid debt obligations equal to the option exercise price (for a put
option); or (for an option on a stock index) will hold a portfolio of securities
substantially replicating the movement of the index (or, to the extent it does
not hold such a portfolio, will maintain a segregated account with the Custodian
of high quality liquid debt obligations equal to the market value of the option,
marked to market daily). When the Fund writes options, it may be required to
maintain a margin account, to pledge the underlying securities or U.S.
government obligations or to deposit liquid high quality debt obligations in a
separate account with the Custodian.
<PAGE>
The purchase and writing of options involves certain risks; for
example, the possible inability to effect closing transactions at favorable
prices and an appreciation limit on the securities set aside for settlement, as
well as (in the case of options on a stock index) exposure to an indeterminate
liability. The purchase of options limits the Fund's potential loss to the
amount of the premium paid and can afford the Fund the opportunity to profit
from favorable movements in the price of an underlying security to a greater
extent than if transactions were effected in the security directly. However, the
purchase of an option could result in the Fund losing a greater percentage of
its investment than if the transaction were effected directly. When the Fund
writes a covered call option, it will receive a premium, but it will give up the
opportunity to profit from a price increase in the underlying security above the
exercise price as long as its obligation as a writer continues, and it will
retain the risk of loss should the price of the security decline. When the Fund
writes a covered put option, it will receive a premium, but it will assume the
risk of loss should the price of the underlying security fall below the exercise
price. When the Fund writes a covered put option on a stock index, it will
assume the risk that the price of the index will fall below the exercise price,
in which case the Fund may be required to enter into a closing transaction at a
loss. An analogous risk would apply if the Fund writes a call option on a stock
index and the price of the index rises above the exercise price.
G. Indexed Securities. The Fund may purchase securities whose prices
are indexed to the prices of other securities, securities indices, or other
financial indicators. Indexed securities typically, but not always, are debt
securities or deposits whose value at maturity or coupon rate is determined by
reference to a specific instrument or statistic.
The performance of indexed securities depends to a great extent on the
performance of the security, or other instrument to which they are indexed, and
also may be influenced by interest rate changes in the U.S. and abroad. At the
same time, indexed securities are subject to the credit risks associated with
the issuer of the security, and their values may decline substantially if the
issuer's creditworthiness deteriorates. Recent issuers of indexed securities
have included banks, corporations, and certain U.S. Government agencies.
INVESTMENT LIMITATIONS
Fundamental. The investment limitations described below have been
adopted by the Trust with respect to the Fund and are fundamental
("Fundamental"), i.e., they may not be changed without the affirmative vote of a
majority of the outstanding shares of the Fund. As used in the Prospectus and
the Statement of Additional Information, the term "majority" of the outstanding
shares of the Fund means the lesser of (1) 67% or more of the outstanding shares
of the Fund present at a meeting, if the holders of more than 50% of the
outstanding shares of the Fund are present or represented at such meeting; or
(2) more than 50% of the outstanding shares of the Fund. Other investment
practices which may be changed by the Board
<PAGE>
of Trustees without the approval of shareholders to the extent permitted by
applicable law, regulation or regulatory policy are considered non-fundamental
("Non-Fundamental").
1. Borrowing Money. The Fund will not borrow money, except (a) from a
bank, provided that immediately after such borrowing there is an asset coverage
of 300% for all borrowings of the Fund; or (b) from a bank or other persons for
temporary purposes only, provided that such temporary borrowings are in an
amount not exceeding 5% of the Fund's total assets at the time when the
borrowing is made. This limitation does not preclude the Fund from entering into
reverse repurchase transactions, provided that the Fund has an asset coverage of
300% for all borrowings and repurchase commitments of the Fund pursuant to
reverse repurchase transactions.
2. Senior Securities. The Fund will not issue senior securities. This
limitation is not applicable to activities that may be deemed to involve the
issuance or sale of a senior security by the Fund, provided that the Fund's
engagement in such activities is consistent with or permitted by the Investment
Company Act of 1940, as amended, the rules and regulations promulgated
thereunder or interpretations of the Securities and Exchange Commission or its
staff.
3. Underwriting. The Fund will not act as underwriter of securities
issued by other persons. This limitation is not applicable to the extent that,
in connection with the disposition of portfolio securities (including restricted
securities), the Fund may be deemed an underwriter under certain federal
securities laws.
4. Real Estate. The Fund will not purchase or sell real estate. This
limitation is not applicable to investments in marketable securities which are
secured by or represent interests in real estate. This limitation does not
preclude the Fund from investing in mortgage-related securities or investing in
companies engaged in the real estate business or that have a significant portion
of their assets in real estate (including real estate investment trusts).
5. Commodities. The Fund will not purchase or sell commodities unless
acquired as a result of ownership of securities or other investments. This
limitation does not preclude the Fund from purchasing or selling options or
futures contracts, from investing in securities or other instruments backed by
commodities or from investing in companies which are engaged in a commodities
business or have a significant portion of their assets in commodities.
6. Loans. The Fund will not make loans to other persons, except (a) by
loaning portfolio securities, (b) by engaging in repurchase agreements, or (c)
by purchasing nonpublicly offered debt securities. For purposes of this
limitation, the term "loans" shall not include the purchase of a portion of an
issue of publicly distributed bonds, debentures or other securities.
<PAGE>
7. Concentration. The Fund will not invest 25% or more of its total
assets in a particular industry. This limitation is not applicable to
investments in obligations issued or guaranteed by the U.S. government, its
agencies and instrumentalities or repurchase agreements with respect thereto.
With respect to the percentages adopted by the Trust as maximum
limitations on its investment policies and limitations, an excess above the
fixed percentage will not be a violation of the policy or limitation unless the
excess results immediately and directly from the acquisition of any security or
the action taken. This paragraph does not apply to the borrowing policy set
forth in paragraph 1 above.
Notwithstanding any of the foregoing limitations, any investment
company, whether organized as a trust, association or corporation, or a personal
holding company, may be merged or consolidated with or acquired by the Trust,
provided that if such merger, consolidation or acquisition results in an
investment in the securities of any issuer prohibited by said paragraphs, the
Trust shall, within ninety days after the consummation of such merger,
consolidation or acquisition, dispose of all of the securities of such issuer so
acquired or such portion thereof as shall bring the total investment therein
within the limitations imposed by said paragraphs above as of the date of
consummation.
Non-Fundamental. The following limitations have been adopted by the Trust
with respect to the Fund and are Non-Fundamental (see "Investment Restrictions"
above).
i. Pledging. The Fund will not mortgage, pledge, hypothecate or in any
manner transfer, as security for indebtedness, any assets of the Fund except as
may be necessary in connection with borrowings described in limitation (1)
above. Margin deposits, security interests, liens and collateral arrangements
with respect to transactions involving options, futures contracts, short sales
and other permitted investments and techniques are not deemed to be a mortgage,
pledge or hypothecation of assets for purposes of this limitation.
ii. Borrowing. The Fund will not purchase any security while borrowings
(including reverse repurchase agreements) representing more than 5% of its total
assets are outstanding. The Fund will not enter into reverse repurchase
agreements.
iii. Margin Purchases. The Fund will not purchase securities or
evidences of interest thereon on "margin." This limitation is not applicable to
short term credit obtained by the Fund for the clearance of purchases and sales
or redemption of securities, or to arrangements with respect to transactions
involving options, futures contracts, short sales and other permitted
investments and techniques.
iv. Short Sales. The Fund will not effect short sales of securities.
<PAGE>
v. Repurchase Agreements. The Fund will not invest more than 5% of its
net assets in repurchase agreements.
vi. Illiquid Investments. The Fund will not invest more than 5% of its
net assets in securities for which there are legal or contractual restrictions
on resale and other illiquid securities.
THE INVESTMENT ADVISOR
The Fund's investment adviser is Burroughs & Hutchinson, 702 W. Idaho
street, Suite 810, Boise, Idaho, 83702. John Hutchinson, President of the
Advisor, and Mark Matsko, the Fund's portfolio manager, are the controlling
shareholders of the Advisor.
Under the terms of the management agreement (the "Agreement"), the
Advisor manages the Fund's investments subject to approval of the Board of
Trustees and pays all of the expenses of the Fund except brokerage, taxes,
interest, fees and expenses of the non-interested person trustees and
extraordinary expenses. As compensation for its management services and
agreement to pay the Fund's expenses, the Fund is obligated to pay the Advisor a
fee computed and accrued daily and paid monthly at an annual rate of 1.48% of
the average daily net assets of the Fund. The Advisor may waive all or part of
its fee, at any time, and at its sole discretion, but such action shall not
obligate the Advisor to waive any fees in the future.
The Advisor retains the right to use the name "Marathon" in connection
with another investment company or business enterprise with which the Advisor is
or may become associated. The Trust's right to use the name "Marathon"
automatically ceases ninety days after termination of the Agreement and may be
withdrawn by the Advisor on ninety days written notice.
The Advisor may make payments to banks or other financial institutions
that provide shareholder services and administer shareholder accounts. The
Glass- Steagall Act prohibits banks from engaging in the business of
underwriting, selling or distributing securities. Although the scope of this
prohibition under the Glass- Steagall Act has not been clearly defined by the
courts or appropriate regulatory agencies, management of the Fund believes that
the Glass-Steagall Act should not preclude a bank from providing such services.
However, state securities laws on this issue may differ from the interpretations
of federal law expressed herein and banks and financial institutions may be
required to register as dealers pursuant to state law. If a bank were prohibited
from continuing to perform all or a part of such services, management of the
Fund believes that there would be no material impact on the Fund or its
shareholders. Banks may charge their customers fees for offering these services
to the extent permitted by applicable regulatory authorities, and the overall
return to those shareholders availing themselves of the bank services will be
lower
<PAGE>
than to those shareholders who do not. The Fund may from time to time purchase
securities issued by banks which provide such services; however, in selecting
investments for the Fund, no preference will be shown for such securities.
TRUSTEES AND OFFICERS
The names of the Trustees and executive officers of the Trust are shown
below. Each Trustee who is an "interested person" of the Trust, as defined in
the Investment Company Act of 1940, is indicated by an asterisk.
<TABLE>
<CAPTION>
===================================================================================================================================
Name, Age and Address Position Principal Occupations During
Past 5 Years
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
* Kenneth D. Trumpfheller President and Trustee President, Treasurer and Secretary of AmeriPrime
Age: 39 Financial Services, Inc., the Fund's administrator, and
1793 Kingswood Drive AmeriPrime Financial Securities, Inc., the Fund's
Suite 200 distributor. Prior to December 1994, a senior client
Southlake, Texas 76092 executive with SEI Financial Services.
- -----------------------------------------------------------------------------------------------------------------------------------
Julie A. Feleo Secretary, Treasurer Secretary, Treasurer and Chief Financial Officer of
AmeriPrime Financial Services, Inc. and AmeriPrime
Age: 31 Financial Securities, Inc.; Fund Reporting Analyst at
Fidelity Investments from 1993 to 1997; Fund
1793 Kingswood Drive Accounting Analyst at Fidelity Investments in 1993.
Prior to 1993, Accounting Manager at Windows
Suite 200 Presentation Manager Association.
Southlake, Texas 76092
- -----------------------------------------------------------------------------------------------------------------------------------
Steve L. Cobb Trustee President of Chandler Engineering Company, L.L.C.,
Age: 40 oil and gas services company; various positions with
2001 Indianwood Ave. Carbo Ceramics, Inc., oil field manufacturing/supply
Broken Arrow, OK 74012 company, from 1984 to 1997, most recently Vice
President of Marketing.
-7-
<PAGE>
- -----------------------------------------------------------------------------------------------------------------------------------
Gary E. Hippenstiel Trustee Director, Vice President and Chief Investment Officer
Age: 50 of Legacy Trust Company since 1992; President and
32 Sunlit Forest Drive Director of Heritage Trust Company from 1994 to
The Woodlands, Texas 77381 1996; Vice President and Manager of Investments of
Kanaly
Trust Company from 1988 to 1992.
===================================================================================================================================
</TABLE>
<PAGE>
The compensation paid to the Trustees of the Trust for the period ended
October 31, 1997 is set forth in the following table. Trustee fees are Trust
expenses and each series of the Trust is responsible for a portion of the
Trustee fees.
Name
Aggregate
Compensation
from Trust
Total Compensation
from Trust (the Trust is
not in a Fund Complex)
Kenneth D. Trumpfheller
0
0
Steve L. Cobb
$4,000
$4,000
Gary E. Hippenstiel
$4,000
$4,000
PORTFOLIO TRANSACTIONS AND BROKERAGE
Subject to policies established by the Board of Trustees of the Trust,
the Advisor is responsible for the Fund's portfolio decisions and the placing of
the Fund's portfolio transactions. In placing portfolio transactions, the
Advisor seeks the best qualitative execution for the Fund, taking into account
such factors as price (including the applicable brokerage commission or dealer
spread), the execution capability, financial responsibility and responsiveness
of the broker or dealer and the brokerage and research services provided by the
broker or dealer. The Advisor generally seeks favorable prices and commission
rates that are reasonable in relation to the benefits received.
The Advisor is specifically authorized to select brokers or dealers who
also provide brokerage and research services to the Fund and/or the other
accounts over which the Advisor exercises investment discretion and to pay such
brokers or dealers a commission in excess of the commission another broker or
dealer would charge if the Advisor determines in good faith that the commission
is reasonable in relation to the value of the brokerage and research services
provided. The determination may be viewed in terms of a particular transaction
or the Advisor's overall responsibilities with respect to the Trust and to other
accounts over which it exercises investment discretion.
Research services include supplemental research, securities and
economic analyses, statistical services and information with respect to the
availability of securities or purchasers or sellers of securities and analyses
of reports concerning performance of accounts. The research services and other
information furnished by brokers through whom the Fund effects securities
transactions may also be used by the Advisor in servicing all of its accounts.
Similarly, research and information
<PAGE>
provided by brokers or dealers serving other clients may be useful to the
Advisor in connection with its services to the Fund. Although research services
and other information are useful to the Fund and the Advisor, it is not possible
to place a dollar value on the research and other information received. It is
the opinion of the Board of Trustees and the Advisor that the review and study
of the research and other information will not reduce the overall cost to the
Advisor of performing its duties to the Fund under the Agreement.
Over-the-counter transactions will be placed either directly with
principal market makers or with broker-dealers, if the same or a better price,
including commissions and executions, is available. Fixed income securities are
normally purchased directly from the issuer, an underwriter or a market maker.
Purchases include a concession paid by the issuer to the underwriter and the
purchase price paid to a market maker may include the spread between the bid and
asked prices.
To the extent that the Trust and another of the Advisor's clients seek
to acquire the same security at about the same time, the Trust may not be able
to acquire as large a position in such security as it desires or it may have to
pay a higher price for the security. Similarly, the Trust may not be able to
obtain as large an execution of an order to sell or as high a price for any
particular portfolio security if the other client desires to sell the same
portfolio security at the same time. On the other hand, if the same securities
are bought or sold at the same time by more than one client, the resulting
participation in volume transactions could produce better executions for the
Trust. In the event that more than one client wants to purchase or sell the same
security on a given date, the purchases and sales will normally be made by
random client selection.
DETERMINATION OF SHARE PRICE
The price (net asset value) of the shares of the Fund is determined as
of 4:00 p.m., Eastern time on each day the Trust is open for business and on any
other day on which there is sufficient trading in the Fund's securities to
materially affect the net asset value. The Trust is open for business on every
day except Saturdays, Sundays and the following holidays: New Year's Day, Martin
Luther King, Jr. Day, President's Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving and Christmas. For a description of the methods
used to determine the net asset value (share price), see "Share Price
Calculation" in the Prospectus.
<PAGE>
INVESTMENT PERFORMANCE
"Average annual total return," as defined by the Securities and
Exchange Commission, is computed by finding the average annual compounded rates
of return (over the one and five year periods and the period from initial public
offering through the end of the Fund's most recent fiscal year) that would
equate the initial amount invested to the ending redeemable value, according to
the following formula:
P(1+T)n=ERV
Where: P = a hypothetical $1,000 initial investment
T = average annual total return
n = number of years
ERV = ending redeemable value at the end of the
applicable period of the hypothetical $1,000
investment made at the beginning of the
applicable period.
The computation assumes that all dividends and distributions are reinvested at
the net asset value on the reinvestment dates and that a complete redemption
occurs at the end of the applicable period.
The Fund's investment performance will vary depending upon market
conditions, the composition of the Fund's portfolio and operating expenses of
the Fund. These factors and possible differences in the methods and time periods
used in calculating non-standardized investment performance should be considered
when comparing the Fund's performance to those of other investment companies or
investment vehicles. The risks associated with the Fund's investment objective,
policies and techniques should also be considered. At any time in the future,
investment performance may be higher or lower than past performance, and there
can be no assurance that any performance will continue.
From time to time, in advertisements, sales literature and information
furnished to present or prospective shareholders, the performance of the Fund
may be compared to indices of broad groups of unmanaged securities considered to
be representative of or similar to the portfolio holdings of the Fund or
considered to be representative of the stock market in general. The Fund may use
the Russell Midcap Index.
In addition, the performance of the Fund may be compared to other groups of
<PAGE>
mutual funds tracked by any widely used independent research firm which ranks
mutual funds by overall performance, investment objectives and assets, such as
Lipper Analytical Services, Inc. or Morningstar, Inc. The objectives, policies,
limitations and expenses of other mutual funds in a group may not be the same as
those of the Fund. Performance rankings and ratings reported periodically in
national financial publications such as Barron's and Fortune also may be used.
CUSTODIAN
Star Bank, N.A., 425 Walnut Street, Cincinnati, Ohio 45202, is
Custodian of the Fund's investments. The Custodian acts as the Fund's
depository, safekeeps its portfolio securities, collects all income and other
payments with respect thereto, disburses funds at the Fund's request and
maintains records in connection with its duties.
TRANSFER AGENT
American Data Services, Inc., Hauppauge Corporate Center, 150 Motor
Parkway, Hauppauge, NY 11760, acts as the Fund's transfer agent and, in such
capacity, maintains the records of each shareholder's account, answers
shareholders' inquiries concerning their accounts, processes purchases and
redemptions of the Fund's shares, acts as dividend and distribution disbursing
agent and performs other accounting and shareholder service functions. In
addition, American Data Services, Inc. provides the Fund with certain monthly
reports, record-keeping and other management-related services.
ACCOUNTANTS
The firm of McCurdy & Associates, CPA's, 27955 Clemens Road, Westlake,
Ohio 44145, has been selected as independent public accountants for the Trust
for the fiscal year ending October 31, 1998. McCurdy & Associates performs an
annual audit of the Fund's financial statements and provides financial, tax and
accounting consulting services as requested.
DISTRIBUTOR
AmeriPrime Financial Securities, Inc., 1793 Kingswood Drive, Suite 200,
Southlake, Texas 76092, is the exclusive agent for distribution of shares of the
Fund. The Distributor is obligated to sell the shares of the Fund on a best
efforts
<PAGE>
basis only against purchase orders for the shares. Shares of the Fund are
offered to the public on a continuous basis.
<PAGE>
AmeriPrime Funds
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements.
(b) Exhibits
(1) (i) Copy of Registrant's Declaration of Trust which was filed as an
Exhibit to Registrants's Post-Effective Amendment No. 11 is hereby incorporated
by reference.
(ii) Copy of Amendment No. 1 to Registrant's Declaration of Trust which was
filed as an Exhibit to Registrants's Post-Effective Amendment No. 11 is hereby
incorporated by reference.
(iii) Copy of Amendment No. 2 to Registrant's Declaration of Trust, which
was filed as an Exhibit to Registrant's Post-Effective Amendment No. 1, is
hereby incorporated by reference.
(iv) Copy of Amendment No. 3 to Registrant's Declaration of Trust, which
was filed as an Exhibit to Registrant's Post-Effective
<PAGE>
Amendment No. 4, is hereby incorporated by reference.
(v) Copy of Amendment No. 4 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 4, is hereby
incorporated by reference.
(vi) Copy of Amendment No. 5 and Amendment No. 6 to Registrant's
Declaration of Trust, which were filed as an Exhibit to Registrant's
PostEffective Amendment No. 8, are hereby incorporated by reference.
(viii) Copy of Amendment No. 7 which was filed as an Exhibit to
Registrants's Post-Effective Amendment No. 11 is hereby incorporated by
reference.
(ix) Copy of Amendment No. 8 to Registrants Declaration of Trust is filed
herewith.
(2) Copy of Registrant's By-Lawswhich was filed as an Exhibit to
Registrants's Post-Effective Amendment No. 11 is hereby incorporated by
reference.
(3) Voting Trust Agreements - None.
(4) Specimen of Share Certificates - None.
(5) (i) Copy of Registrant's Management Agreement with Carl Domino
Associates, L.P., Adviser to Carl Domino Equity Income Fund, which was filed as
an Exhibit to Post-Effective Amendment No. 11 is hereby incorporated by
reference.
(ii) Copy of Registrant's Management Agreement with Jenswold, King &
Associates, Adviser to Fountainhead Special Value Fund, which was filed as an
Exhibit to Registrant's PostEffective Amendment No. 8, is hereby incorporated by
reference.
(iii) Copy of Registrant's Management Agreement with Advanced Investment
Technology, Inc., Adviser to AIT Vision U.S. Equity Portfolio, which was filed
as an Exhibit to Post-Effective Amendment No. 11 is hereby incorporated by
reference.
(iv) Copy of Registrant's Management Agreement with GLOBALT, Inc., Adviser
to GLOBALT Growth Fund, which was filed as an Exhibit to Post-Effective
Amendment No. 11 is hereby incorporated by reference.
(v) Copy of Registrant's Management Agreement with Newport Investment
Advisors, Inc., Adviser to the MAXIM Contrarian Fund, which was filed as an
Exhibit to Registrant's Post-Effective Amendment No. 2, is hereby incorporated
by reference.
(vi) Copy of Registrant's Management Agreement with IMS Capital Management,
Inc., Adviser to the IMS Capital Value Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 2, is hereby incorporated by
reference.
<PAGE>
(vii) Copy of Registrant's Management
Agreement with Commonwealth
Advisors, Inc., Adviser to Florida
Street Bond Fund and Florida Street
Growth Fund, which was filed as an
Exhibit to Registrant's
Post-Effective Amendment No. 8, is
hereby incorporated by reference.
(viii) Copy of Registrant's Management
Agreement with Corbin & Company,
Adviser to Corbin Small-Cap Fund,
which was filed as an Exhibit to
Registrant's Post-Effective
Amendment No. 8, is hereby
incorporated by reference.
(ix) Copy of Registrant's proposed
Management Agreement with Vuong
Asset Management Company, LLC,
Adviser to MAI Enhanced Index Fund,
MAI Growth & Income Fund, MAI
Aggressive Growth Fund, MAI
High-Yield Income Fund, MAI Capital
Appreciation Fund and MAI Global
Equity Fund (the "MAI Family of
Funds"), is filed herewith.
(x) Copy of Registrant's proposed
Management Agreement with CWH
Associates, Inc., Advisor to
Worthington Theme Fund, which was
filed as an Exhibit to Registrant's
Post-Effective Amendment No. 10, is
hereby incorporated by
reference.
(xi) Copy of Registrant's proposed
Management Agreement with Burroughs
& Hutchinson, Inc. Advisor to the
Marathon Value Fund is filed
herewith.
(6) (i) Copy of Registrant's Amended and Restated
Underwriting Agreement with AmeriPrime
Financial Securities, Inc., which was filed
as an Exhibit to Registrant's Post-Effective
Amendment No. 8, is hereby incorporated by
reference.
(ii) Copy of Registrants proposed Underwriting
Agreement with AmeriPrime Financial
Securities, Inc. and Omni Financial Group,
LLC is filed herewith
(7) Bonus, Profit Sharing, Pension or Similar
Contracts for the benefit of Directors or
Officers - None.
(8) (i) Copy of Registrant's Agreement with the Custodian, Star Bank, N.A.
which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 11,
is hereby incorporated by reference.
(ii) Copy of Registrant's Appendix B to
the Agreement with the Custodian,
Star Bank, N.A., which was filed as
an Exhibit to Registrant's
Post-Effective Amendment No. 8, is
hereby incorporated by reference.
(9) Copy of Registrant's Agreement with the Administrator, AmeriPrime
Financial Services, Inc. which was filed as an Exhibit to Registrant's
Post-Effective Amendment No. 11, is hereby incorporated by reference.
(10) Opinion and Consent of Brown, Cummins &
Brown Co., L.P.A., which was filed as an
Exhibit to Registrant's Post-Effective
Amendment No. 9, is hereby incorporated by
reference.
(11) Consent of independent public accountants.
None
(12)Financial Statements Omitted from Item 23 - None.
<PAGE>
(13) Copy of Letter of Initial Stockholders which was filed as an Exhibit
to Registrant's Post-Effective Amendment No. 11, is hereby incorporated by
reference.
(14) Model Plan used in Establishment of any
Retirement Plan - None.
(15) (i) Copy of Registrant's Rule 12b-1
Distribution Plan for The MAXIM
Contrarian Fund, which was filed as
an Exhibit to Registrant's
PostEffective Amendment No. 1, is
hereby incorporated by reference.
(ii) Copy of Registrant's Rule 12b-1
Service Agreement for The MAXIM
Contrarian Fund, which was filed as
an Exhibit to Registrant's
PostEffective Amendment No. 1, is
hereby incorporated by reference.
(16) Schedules for Computation of Each Performance Quotation is filed
herewith.
(17) Financial Data Schedule - None.
(18) Rule 18f-3 Plan - None.
(19) (i) Power of Attorney for Registrant
and Certificate with respect
thereto, which were filed as an
Exhibit to Registrant's
PostEffective Amendment No. 5, are
hereby incorporated by reference.
(ii) Powers of Attorney for Trustees and
Officers which were filed as an
Exhibit to Registrant's
Post-Effective Amendment No. 5, are
hereby incorporated by reference.
(iii) Power of Attorney for the Treasurer
of the Trust, which was filed as an
Exhibit to Registrant's
Post-Effective Amendment No. 8, is
hereby incorporated by reference.
Item 25. Persons Controlled by or Under Common Control with the
Registrant (As of December 3, 1997)
The Carl Domino Associates, L.P., Profit Sharing Trust may be deemed to
control the Carl Domino Equity Income Fund; U.S. Trust Company of Florida, as
Trustee of the Killian Charitable Remainder Unitrust and Cheryl and Kenneth
Holeski may be deemed to control The NewCap Contrarian Fund, as a result of
their respective beneficial ownership of those Funds.
Item 26. Number of Holders of Securities (as of December 3, 1997)
- -------- --------------------------------------------------------
Title of Class Number of Record Holders
Carl Domino Equity Income Fund 83
Fountainhead Special Value Fund 61
AIT Vision U.S. Equity Portfolio 31
GLOBALT Growth Fund 65
NewCap Contrarian Fund 43
<PAGE>
IMS Capital Value Fund 445
Florida Street Bond Fund 2
Florida Street Growth Fund 1
Corbin Small-Cap Value Fund 69
MAI Enhanced Equity Benchmark Fund 0
MAI Enhanced Growth and Income Fund 0
MAI Enhanced Aggressive Growth Fund 0
MAI Enhanced Income Fund 0
MAI Enhanced Capital Appreciation Fund 0
MAI Enhanced Global Fund 0
Worthington Theme Fund 0
Marathon Value Fund 0
Item 27. Indemnification
(a) Article VI of the Registrant's Declaration of Trust
provides for indemnification of officers and Trustees
as follows:
Section 6.4 Indemnification of
Trustees, Officers, etc. Subject to and
except as otherwise provided in the
Securities Act of 1933, as amended, and the
1940 Act, the Trust shall indemnify each of
its Trustees and officers (including persons
who serve at the Trust's request as
directors, officers or trustees of another
organization in which the Trust has any
interest as a shareholder, creditor or
otherwise (hereinafter referred to as a
"Covered Person") against all liabilities,
including but not limited to amounts paid in
satisfaction of judgments, in compromise or
as fines and penalties, and expenses,
including reasonable accountants' and
counsel fees, incurred by any Covered Person
in connection with the defense or
disposition of any action, suit or other
proceeding, whether civil or criminal,
before any court or administrative or
legislative body, in which such Covered
Person may be or may have been involved as a
party or otherwise or with which such person
may be or may have been threatened, while in
office or thereafter, by reason of being or
having been such a Trustee or officer,
director or trustee, and except that no
Covered Person shall be indemnified against
any liability to the Trust or its
Shareholders to which such Covered Person
would otherwise be subject by reason of
willful misfeasance, bad faith, gross
negligence or reckless disregard of the
duties involved in the conduct of such
Covered Person's office.
Section 6.5 Advances of Expenses.
The Trust shall advance attorneys' fees or
other expenses incurred by a Covered Person
in defending a proceeding to the full extent
permitted by the Securities Act of 1933, as
amended, the 1940 Act, and Ohio Revised Code
Chapter 1707, as amended. In the event any
of these laws conflict with Ohio
<PAGE>
Revised Code Section 1701.13(E), as amended,
these laws, and not Ohio Revised Code
Section 1701.13(E), shall govern.
Section 6.6 Indemnification Not
Exclusive, etc. The right of indemnification
provided by this Article VI shall not be
exclusive of or affect any other rights to
which any such Covered Person may be
entitled. As used in this Article VI,
"Covered Person" shall include such person's
heirs, executors and administrators. Nothing
contained in this article shall affect any
rights to indemnification to which personnel
of the Trust, other than Trustees and
officers, and other persons may be entitled
by contract or otherwise under law, nor the
power of the Trust to purchase and maintain
liability insurance on behalf of any such
person.
The Registrant may not pay for insurance which
protects the Trustees and officers against
liabilities rising from action involving willful
misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of
their offices.
(b) The Registrant may maintain a standard mutual fund and investment
advisory professional and directors and officers liability policy. The policy,
if maintained, would provide coverage to the Registrant, its Trustees and
officers, and could cover its Advisers, among others. Coverage under the policy
would include losses by reason of any act, error, omission, misstatement,
misleading statement, neglect or breach of duty.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers and controlling persons of
the Registrant pursuant to the provisions of Ohio law and the Agreement and
Declaration of the Registrant or the By-Laws of the Registrant, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a trustee, officer or controlling
person of the Trust in the successful defense of any action, suit or proceeding)
is asserted by such trustee, officer or controlling person in connection with
the securities being registered, the Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
<PAGE>
Item 28. Business and Other Connections of Investment Adviser
A. Carl Domino Associates, L.P., 580 Village Boulevard,
Suite 225, West Palm Beach, Florida 33409, ("CDA"),
adviser to the Carl Domino Equity Income Fund, is a
registered investment adviser.
(1) CDA has engaged in no other business during
the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
partners and officers of CDA during the past
two years.
(a) Penn Independent Corp., a partner in
CDA, is an insurance holding company
that operates a premium finance
company, a surplus lines insurance
company and a wholesale insurance
agency.
(b) James E. Heerin, Jr., an officer of
CDA, is vice president and general
counsel of Penn Independent Corp.
and an officer and director of
Shrimp Culture II, Inc., both at 420
South York Road, Hatboro, PA 19040.
Shrimp Culture II, Inc. raises and
sells shrimp.
(c) Lawrence Katz, a partner in CDA, is
an orthopedic surgeon in private
practice.
(d) Saltzman Partners, a partner in CDA,
is a limited partnership that
invests in companies and businesses.
(e) Cango Inversiones, SA, a partner in
CDA, is a foreign business entity
that invests in U.S. companies and
businesses.
B. Jenswold, King & Associates, Inc., 1980 Post Oak
Boulevard, Suite 2400, Houston, Texas 77056-3898
("JKA"), adviser to the Fountainhead Special Value
Fund, is a registered investment adviser.
(1) JKA has engaged in no other business during
the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
directors and officers of JKA during the
past two years.
(a)John Servis, a director of JKA, is a licensed
real estate broker.
C. Advanced Investment Technology, Inc., 311 Park Place
Boulevard, Suite 250, Clearwater, Florida 34619
("AIT"), adviser to AIT Vision U.S. Equity Portfolio,
is a registered investment adviser.
<PAGE>
(1) AIT has engaged in no other business during
the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
directors and officers of AIT during the
past two fiscal years.
(a) Dean S. Barr, director and the CEO
of AIT, was the managing director of
LBS Capital Management, Inc., 311
Park Place Blvd., Clearwater,
Florida from 1989-1996.
(b) Nicholas Lopardo, a dirstor of AIT,
is the CEO of State Street Global
Advisors, Boston, Massachusetts.
(c) Bryan Stypul, CEO Treasurer of AIT, Comptroller for Terra Comm
Communications Clearwater, Florida in 1996, and prior to that, the CEO of Beacon
Advisors, Treasure Island, Florida.
(d) Raymond L. Killian, a director of AIT
is the Chairman of the Board of
Investment Technology Group, Inc.
900 3rd Avenue, New York New York.
(e) Marc Simmons, a director of
AIT is a principal of State Street
Global Advisors.
(e) David C. Cushing, a director of AIT
and a registered representative of
Investment Technology Group, Inc.
(f) Alan Brown, a director of AIT is the
CIO of State Street Global Advisors.
(g) John Snow, a director of AIT, is the
managing director of State Street
Global Advisors. Prior to 1997, he
was President of NatWest Investment
Advisors, Boston, Massachusetts.
D. GLOBALT, Inc., 3060 Peachtree Road, N.W., One
Buckhead Plaza, Suite 225, Atlanta, Georgia 30305
("GLOBALT"), adviser to GLOBALT Growth Fund, is a
registered investment adviser.
(1) GLOBALT has engaged in no other business
during the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
officers and directors of GLOBALT during the
past two years.
(a) Gregory S. Paulette, an officer of
GLOBALT, is the president of GLOBALT
Capital Management, a division of
GLOBALT.
E. Newport Investment Advisors, Inc., 20600 Chagrin
Boulevard, Suite 1020, Shaker Heights, Ohio 44122
("Newport"), adviser to The MAXIM Contrarian Fund, is
a registered investment adviser.
<PAGE>
(1) Newport has engaged in no other business
during the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
officers and directors of Newport during the
past two years.
(a) Kenneth Holeski, president of Newport, is the vice president of Newport
Evaluation Services, Inc., a fiduciary consulting business at 20600 Chagrin
Boulevard, Shaker Heights, Ohio 44122, and a registered representative of WRP
Investments, Inc., 4407 Belmont Avenue, Youngstown, Ohio 44505, a registered
broker/dealer.
(b) Donn M. Goodman, vice president of Newport, is the president of Newport
Evaluation Services, Inc.
F. IMS Capital Management, Inc., 10159 S.E. Sunnyside
Road, Suite 330, Portland, Oregon 97015, ("IMS"),
Adviser to the IMS Capital Value Fund, is a
registered investment adviser.
(1) IMS has engaged in no other business during
the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
directors and officers of IMS during the
past two years - None.
G. CommonWealth Advisors, Inc., 929 Government Street,
Baton Rouge, Louisiana 70802, ("CommonWealth"),
Adviser to the Florida Street Bond Fund and the
Florida Street Growth Fund, is a registered
investment adviser.
(1) CommonWealth has engaged in no other
business during the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
directors and officers of CommonWealth
during the past two years.
(a) Walter A. Morales, President/Chief Investment Officer of CommonWealth
was the Director of an insurance/broadcasting corporation, Guaranty Corporation,
929 Government Street, Baton Rouge, Louisiana 70802 from August 1994 to February
1996. From September 1994 through the present, a registered representative of a
Broker/Dealer company, Securities Service Network, 2225 Peters Road, Knoxville,
Tennessee 37923. Beginning August 1995 through the present, an instructor at the
University of Southwestern Louisiana in Lafayette, Louisiana.
<PAGE>
H. Corbin & Company, 1320 S. University Drive, Suite
406, Fort Worth, Texas 76107, ("Corbin"), Adviser to
the Corbin Small-Cap Value Fund, is a registered
investment adviser.
(1) Corbin has engaged in no other business
during the past two fiscal years.
(2) The following list sets forth other
substantial business activities of the
directors and officers of Corbin during the
past two years - None.
I. Vuong Asset Management Company, LLC, 6575 West Loop
South, Suite 110, Houston, Texas 77401, ("VAMCO"),
Adviser to the MAI Family of Funds, is a registered
investment adviser.
(1) VAMCO has engaged in no other business during the past two
fiscal years.
(2) The following list sets forth substantial business activities
of the directors and officers of VAMCO during the past two
years.
(a) Qui Tu Vuong, the Chief Investment Officer and head of Equity Asset
Management of VAMCO, is the Chief Executive Officer of Vuong & Co., LLC, a
holding company at 6575 West Loop South #110, Bellaire, Texas 77401; and Sales
Manager/Equities Regulation Representative of Omni Financial Group, LLC, a
securities brokerage company at 6575 West Loop South #110, Bellaire, Texas
77401; and President of Oishiicorp, Inc., an investment advising corporation at
6575 West Loop South #110, Bellaire, Texas 77401; and Managing General Partner
of Sigma Delta Capital Appreciation Funds, LP, an investment company at 6575
West Loop South #110, Bellaire, Texas 77401; and President of Premier Capital
Management and Consulting Group, Inc., a financial consulting corporation at
6575 West Loop South #170, Bellaire, Texas 77401; and from August, 1992 through
February, 1996, he was a registered representative of Securities America, Inc.,
a securities brokerage corporation at 6575 West Loop South #170, Bellaire, Texas
77401.
(b) Quyen Ngoc Vuong, President, Chairman and Chief
Financial Officer of VAMCO, is the Manager of Vuong &
Company, LLC, and Manager of Omni Financial Group,
LLC.
(c) Canh Viet Le, Manager of VAMCO, is the Manager of
Vuong and Company, LLC, and was Co-Founder and Chief
Financial Officer of Tribe Computer Works, a
manufacturing network in Alameda, California from
April, 1990 through January, 1996.
<PAGE>
J. CWH Associates, Inc., 200 Park Avenue, Suite 3900, New York,
New York 10166, ("CWH"), Advisor to the Worthington Theme
Fund, is a registered investment Advisor.
(1) CWH has engaged in no other business during the past
two fiscal years.
(2) The following list sets forth other substantial
business activities of the directors and officers of
CWH during the past two years.
Andrew M. Abrams, the Chief Operating Officer of CWH,
is a General Partner of Abrams Investment Partners,
L.P., an investment limited partnership at 200 Park
Avenue, Suite 3900, New York, New York 10166.
K. Burroughs & Hutchinson, Inc. 702 West Idaho Street, Suite 810, Boise,
Idaho ("B&H"), adviser to Marathon Value Fund, is a registered investment
adviser.
(1) B&H has engaged in no other business during the past
two fiscal years.
(2) The following list sets forth other substantial
business activities of the directors and officers of
CWH during the past two years.
Mark R. Matsko, Vice President and Director of B&H was a broker with D.A.
Davidson & Co.. A broker/dealer in Boise, Idaho, from 1994 to 1996.
Item 29. Principal Underwriters
A. AmeriPrime Financial Securities, Inc., is the
Registrant's principal underwriter. Kenneth D.
Trumpfheller, 1793 Kingswood Drive, Suite 200,
Southlake, Texas 76092, is the President, Secretary
and Treasurer of the underwriter and the President
and a Trustee of the Registrant.
B. Omni Financial Group, LLC ("OMNI") acts as co- distributor, along with
AmeriPrime Financial Securities, Inc., of the MAI Family of Funds. Qui T. Vuong,
Quyen N. Vuong and Diep N. Vuong, each of whose principal business address is
6575 West Loop South, Suite 125, Bellaire, Texas 77401, are the managers of
OMNI, and they hold no offices or position with the Registrant.
Item 30. Location of Accounts and Records
Accounts, books and other documents required to be maintained
by Section 31(a) of the Investment Company Act of 1940 and the
Rules promulgated thereunder will be maintained by the
Registrant at 1793 Kingswood Drive, Suite 200, Southlake,
Texas 76092 and/or by the Registrant's Custodian, Star Bank,
N.A., 425 Walnut Street, Cincinnati, Ohio 45202, and/or
transfer and shareholder service agent, American Data
Services, Inc., Hauppauge Corporate Center, 150 Motor Parkway,
Hauppauge, New York 11760.
Item 31. Management Services Not Discussed in Parts A or B
None.
Item 32. Undertakings
(a) Not Applicable.
(b) The Registrant hereby undertakes to furnish each
person to whom a prospectus is delivered with a copy
of the
<PAGE>
Registrant's latest applicable annual report to
shareholders, upon request and without charge.
(c) The Registrant hereby undertakes to file a Post-
Effective Amendment, using financial statements which
need not be certified, within four to six months from
the effective date of the MAI Family of Funds
registration.
(d) The Registrant hereby undertakes to file a
PostEffective Amendment, using financial statements
which need not be certified, within four to six
months from the effective date of the Worthington
Theme Fund registration.
(e) The Registrant hereby undertakes to file a
PostEffective Amendment, using financial statements
which need not be certified, within four to six
months from the effective date of the Marathon
Value Fund registration.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Cincinnati, State of Ohio, on the 23rd day of
December, 1997.
AmeriPrime Funds
By:
Donald S. Mendelsohn,
Attorney-in-Fact
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Kenneth D. Trumpfheller,
President and Trustee By:_________________________
Donald S. Mendelsohn,
Julie A. Feleo, Treasurer Attorney-in-Fact
Steve L. Cobb, Trustee December ____, 1997
Gary E. Hippenstiel, Trustee
<PAGE>
EXHIBIT INDEX
EXHIBIT
1. Amendment No. 8 to Declaration of Trust........................EX-99.B1
2. Management Agreement with Voung Asset Management.............EX-99.B5.1
3. Proposed Management Agreement with Burroughs & Hutchinson....EX-99.B5.2
4. Proposed Underwriting Agreement with Ameriprime Financial
Securities,Inc. and Omni Financial Group, LLC................ EX-99.B6
5. Schedules for Computation of Performance
Information ......................EX-99.B6
ASA02D88-121197-1
<PAGE>
AmeriPrime Funds Amendment No. 8
Agreement and Declaration of Trust
1. Pursuant to Section 4.1 of the Agreement and Declaration of Trust of
AmeriPrime Funds and effective upon the execution of this document, the
undersigned, being a majority of the trustees of AmeriPrime Funds, hereby
establish two new series of shares of the Trust and designate such series the
"Marathon Value Fund" and the "Worthington Theme Fund." The relative rights and
preferences of the series shall be those rights and preferences set forth in
Section 4.2 of the Agreement and Declaration of Trust of AmeriPrime Funds.
2. This document shall have the status of an Amendment to said
Agreement and Declaration of Trust, and may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
-----------------------------------
Steve L. Cobb
-----------------------------------
Gary E. Hippenstiel
-----------------------------------
Kenneth D. Trumpfheller
December 15, 1997
ASA02D91-120897-2
<PAGE>
MANAGEMENT AGREEMENT
TO: Vuong Asset Management Company, LLC
6575 West Loop South, Suite 110
Houston, Texas 77401
Dear Sirs:
AmeriPrime Funds (the "Trust") herewith confirms our agreement with
you.
The Trust has been organized to engage in the business of an investment
company. The Trust currently offers several series of shares to investors,
including MAI Enhanced Equity Benchmark Fund, MAI Enhanced Growth & Income Fund,
MAI Enhanced Aggressive Growth Fund, MAI Enhanced Income Fund; MAI Enhanced
Capital Appreciation Fund and MAI Enhanced Global Fund (each a Fund and
collectively the "Funds").
You have been selected to act as the sole investment adviser of the
Funds and to provide certain other services, as more fully set forth below, and
you are willing to act as such investment adviser and to perform such services
under the terms and conditions hereinafter set forth. Accordingly, the Trust
agrees with you as follows upon the date of the execution of this Agreement.
1. ADVISORY SERVICES
You will regularly provide the Funds with such investment
advice as you in your discretion deem advisable and will furnish a continuous
investment program for the Funds consistent with the respective Funds'
investment objectives and policies. You will determine the securities to be
purchased for each Fund, the portfolio securities to be held or sold by each
Fund and the portion of each Fund's assets to be held uninvested, subject always
to the Fund's investment objectives, policies and restrictions, as each of the
same shall be from time to time in effect, and subject further to such policies
and instructions as the Board may from time to time establish. You will advise
and assist the officers of the Trust in taking such steps as are necessary or
appropriate to carry out the decisions of the Board and the appropriate
committees of the Board regarding the conduct of the business of the Funds.
2. ALLOCATION OF CHARGES AND EXPENSES
You will pay all operating expenses of the Funds, including
the compensation and expenses of any employees of the Funds and of any other
persons rendering any services to the Funds; clerical and shareholder service
staff salaries; office space and other office expenses; fees and expenses
incurred by the Funds in connection with membership in investment company
organizations; legal, auditing and accounting expenses; expenses of registering
shares under federal and state securities laws, excluding expenses incurred by
the Funds in connection with the organization and initial registration of shares
of the Funds; insurance expenses; fees and expenses of the custodian, transfer
agent, dividend disbursing agent, shareholder service agent, plan agent,
administrator, accounting and pricing services agent and underwriter of the
Funds; expenses, including clerical expenses, of issue, sale, redemption or
repurchase of shares of the Funds; the cost of preparing and distributing
reports and notices to shareholders, the cost of printing or preparing
prospectuses and statements of additional information for delivery to each
Fund's current and prospective shareholders; the cost of printing or preparing
stock certificates or any other documents, statements or reports to
shareholders; expenses
<PAGE>
of shareholders' meetings and proxy solicitations; advertising, promotion and
other expenses incurred directly or indirectly in connection with the sale or
distribution of the Funds' shares; and all other operating expenses not
specifically assumed by the Funds.
Each Fund will pay all of its respective brokerage fees and
commissions, taxes, interest, fees and expenses of the non-interested person
trustees and such extraordinary or non-recurring expenses as may arise,
including organizational expenses, and litigation to which the Fund may be a
party and indemnification of the Trust's trustees and officers with respect
thereto. You may obtain reimbursement from a Fund, at such time or times as you
may determine in your sole discretion, for any of the expenses advanced by you,
which the Fund is obligated to pay, and such reimbursement shall not be
considered to be part of your compensation pursuant to this Agreement.
Notwithstanding anything herein to the contrary, the Funds
will only be liable for organizational expenses when the Funds'combined assets
reach $10,000,000 or if a Fund is in existence through October 31, 1998, and
until such time, you are liable for such expenses. You will cause such expenses
to be advanced on behalf of each Fund and may obtain reimbursement from the Fund
after the Funds becomes liable.
3. COMPENSATION OF THE ADVISER
For all of the services to be rendered and payments to be made as provided
in this Agreement, as of the last business day of each month, each Fund will pay
you a fee at the annual rate, based on the average value of its daily net
assets, as follows: MAI Enhanced Equity Benchmark: 1.20%; MAI Enhanced Capital
Appreciation: 1.20%; MAI Enhanced Aggressive Growth: 1.20%; MAI Enhanced Growth
& Income: 1.00%; MAI Enhanced Income: 0.60%; MAI Enhanced Global: 1.40%.
The average value of the daily net assets of a Fund shall be
determined pursuant to the applicable provisions of the Declaration of Trust of
the Trust or a resolution of the Board, if required. If, pursuant to such
provisions, the determination of net asset value of a Fund is suspended for any
particular business day, then for the purposes of this paragraph, the value of
the net assets of the Fund as last determined shall be deemed to be the value of
the net assets as of the close of the business day, or as of such other time as
the value of the Fund's net assets may lawfully be determined, on that day. If
the determination of the net asset value of a Fund has been suspended for a
period including such month, your compensation payable at the end of such month
shall be computed on the basis of the value of the net assets of the Fund as
last determined (whether during or prior to such month).
4. EXECUTION OF PURCHASE AND SALE ORDERS
In connection with purchases or sales of portfolio securities
for the account of each Fund, it is understood that you will arrange for the
placing of all orders for the purchase and sale of portfolio securities for the
account with brokers or dealers selected by you, subject to review of this
selection by the Board from time to time. You will be responsible for the
negotiation and the allocation of principal business and portfolio brokerage. In
the selection of such brokers or dealers and the placing of such orders, you are
directed at all times to seek for the Funds the best qualitative execution,
taking into account such factors as price (including the applicable brokerage
commission or dealer spread), the execution capability, financial responsibility
and responsiveness of the broker or dealer and the brokerage and research
services provided by the broker or dealer.
You should generally seek favorable prices and commission rates that are
reasonable
<PAGE>
in relation to the benefits received. In seeking best qualitative execution, you
are authorized to select brokers or dealers who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the Securities
Exchange Act of 1934) to the Funds and/or the other accounts over which you
exercise investment discretion. You are authorized to pay a broker or dealer who
provides such brokerage and research services a commission for executing a Fund
portfolio transaction which is in excess of the amount of commission another
broker or dealer would have charged for effecting that transaction if you
determine in good faith that the amount of the commission is reasonable in
relation to the value of the brokerage and research services provided by the
executing broker or dealer. The determination may be viewed in terms of either a
particular transaction or your overall responsibilities with respect to the
Funds and to accounts over which you exercise investment discretion. The Funds
and you understand and acknowledge that, although the information may be useful
to the Funds and you, it is not possible to place a dollar value on such
information. The Board shall periodically review the commissions paid by each
Fund to determine if the commissions paid over representative periods of time
were reasonable in relation to the benefits to the Fund.
Consistent with the Rules of Fair Practice of the National
Association of Securities Dealers, Inc., and subject to seeking best qualitative
execution as described above, you may give consideration to sales of shares of
the Funds as a factor in the selection of brokers and dealers to execute Fund
portfolio transactions.
Subject to the provisions of the Investment Company Act of
1940, as amended, and other applicable law, you, any of your affiliates or any
affiliates of your affiliates may retain compensation in connection with
effecting the Funds' portfolio transactions, including transactions effected
through others. If any occasion should arise in which you give any advice to
clients of yours concerning the shares of a Fund, you will act solely as
investment counsel for such client and not in any way on behalf of the Fund.
Your services to the Funds pursuant to this Agreement are not to be deemed to be
exclusive and it is understood that you may render investment advice, management
and other services to others, including other registered investment companies.
5. LIMITATION OF LIABILITY OF ADVISER
You may rely on information reasonably believed by you to be
accurate and reliable. Except as may otherwise be required by the Investment
Company Act of 1940 or the rules thereunder, neither you nor your shareholders,
officers, directors, employees, agents, control persons or affiliates of any
thereof shall be subject to any liability for, or any damages, expenses or
losses incurred by the Trust in connection with, any error of judgment, mistake
of law, any act or omission connected with or arising out of any services
rendered under, or payments made pursuant to, this Agreement or any other matter
to which this Agreement relates, except by reason of willful misfeasance, bad
faith or gross negligence on the part of any such persons in the performance of
your duties under this Agreement, or by reason of reckless disregard by any of
such persons of your obligations and duties under this Agreement.
Any person, even though also a director, officer, employee,
shareholder or agent of you, who may be or become an officer, director, trustee,
employee or agent of the Trust, shall be deemed, when rendering services to the
Trust or acting on any business of the Trust (other than services or business in
connection with your duties hereunder), to be rendering such services to or
acting solely for the Trust and not as a director, officer, employee,
shareholder or agent of you, or one under your control or direction, even though
paid by you.
6. DURATION AND TERMINATION OF THIS AGREEMENT
<PAGE>
This Agreement shall take effect on the date of its execution
by you, and shall remain in force for a period of two (2) years from the date of
its execution, and from year to year thereafter, subject to annual approval by
(i) the Board or (ii) a vote of a majority (as defined in the Investment Company
Act of 1940) of the outstanding voting securities of such Fund, provided that in
either event continuance is also approved by a majority of the trustees who are
not "interested persons," as defined in the Investment Company Act of 1940, of
you or the Trust, by a vote cast in person at a meeting called for the purpose
of voting such approval.
If the shareholders of a Fund fail to approve the Agreement in
the manner set forth above, upon request of the Board, you will continue to
serve or act in such capacity for the Fund for the period of time pending
required approval of the Agreement, of a new agreement with you or a different
adviser or other definitive action; provided that the compensation to be paid by
the Fund to you for your services to and payments on behalf of the Fund will be
equal to the lesser of your actual costs incurred in furnishing such services
and payments or the amount you would have received under this Agreement for
furnishing such services and payments.
This Agreement may, on sixty days written notice, be
terminated with respect to a Fund, at any time without the payment of any
penalty, by the Board, by a vote of a majority of the outstanding voting
securities of the Fund, or by you. This Agreement shall automatically terminate
in the event of its assignment.
7. USE OF NAME
The Trust and you acknowledge that all rights to the name
"MAI" belongs to you, and that the Trust is being granted a limited license to
use such words in the Fund names or in any name of any class of Fund. In the
event you cease to be the adviser to a Fund, the Trust's right to the use of the
name "MAI" shall automatically cease on the ninetieth day following the
termination of this Agreement. The right to the name may also be withdrawn by
you during the term of this Agreement upon ninety (90) days' written notice by
you to the Trust. Nothing contained herein shall impair or diminish in any
respect, your right to use the name "MAI" in the name of, or in connection with,
any other business enterprises with which you are or may become associated.
There is no charge to the Trust for the right to use these names.
<PAGE>
8. AMENDMENT OF THIS AGREEMENT
No provision of this Agreement may be changed, waived,
discharged or terminated orally, and no amendment of this Agreement shall be
effective until approved by the Board, including a majority of the trustees who
are not interested persons of you or of the Trust, cast in person at a meeting
called for the purpose of voting on such approval, and (if required under
current interpretations of the Act by the Securities and Exchange Commission) by
vote of the holders of a majority of the outstanding voting securities of the
series to which the amendment relates.
9. LIMITATION OF LIABILITY TO TRUST PROPERTY
The term "AmeriPrime Funds" means and refers to the Trustees
from time to time serving under the Trust's Declaration of Trust as the same may
subsequently thereto have been, or subsequently hereto be, amended. It is
expressly agreed that the obligations of the Trust hereunder shall not be
binding upon any of the trustees, shareholders, nominees, officers, agents or
employees of the Trust personally, but bind only the trust property of the
Trust, as provided in the Declaration of Trust of the Trust. The execution and
delivery of this Agreement have been authorized by the trustees and shareholders
of the Trust and signed by officers of the Trust, acting as such, and neither
such authorization by such trustees and shareholders nor such execution and
delivery by such officers shall be deemed to have been made by any of them
individually or to impose any liability on any of them personally, but shall
bind only the trust property of the Trust as provided in its Declaration of
Trust. A copy of the Agreement and Declaration of Trust of the Trust is on file
with the Secretary of the State of Ohio.
10. SEVERABILITY
In the event any provision of this Agreement is determined to
be void or unenforceable, such determination shall not affect the remainder of
this Agreement, which shall continue to be in force.
11. QUESTIONS OF INTERPRETATION
(a) This Agreement shall be governed by the laws of the State
of Ohio.
(b) Any question of interpretation of any term or provision of
this Agreement having a counterpart in or otherwise derived from a term or
provision of the Investment Company Act of 1940, as amended (the "Act") shall be
resolved by reference to such term or provision of the Act and to interpretation
thereof, if any, by the United States courts or in the absence of any
controlling decision of any such court, by rules, regulations or orders of the
Securities and Exchange Commission issued pursuant to said Act. In addition,
where the effect of a requirement of the Act, reflected in any provision of this
Agreement is revised by rule, regulation or order of the Securities and Exchange
Commission, such provision shall be deemed to incorporate the effect of such
rule, regulation or order.
12. NOTICES
Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to the other party at such
address as such other party may designate for the receipt of such notice. Until
further notice to the other party, it is agreed that the address of the Trust is
1793 Kingswood Drive, Suite 200, Southlake, Texas 76092, and your address for
this purpose shall be 6575 West Loop South, Suite 110, Houston, Texas 77401.
<PAGE>
13. COUNTERPARTS
This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
14. BINDING EFFECT
Each of the undersigned expressly warrants and represents that
he has the full power and authority to sign this Agreement on behalf of the
party indicated, and that his signature will operate to bind the party indicated
to the foregoing terms.
15. CAPTIONS
The captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
If you are in agreement with the foregoing, please sign the
form of acceptance on the accompanying counterpart of this letter and return
such counterpart to the Trust, whereupon this letter shall become a binding
contract upon the date thereof.
Yours very truly,
ATTEST: AmeriPrime Funds
By
Name/Title: ______________________ Kenneth D. Trumpfheller, President
Dated: _________________, 1997
ACCEPTANCE
The foregoing Agreement is hereby accepted.
ATTEST: Vuong Asset Management Company, LLC
By
Name/Title: ____________________ Qui T. Vuong, Managing Member
Dated: _______________, 1997
ASA02B19-121097-1
MANAGEMENT AGREEMENT
TO: Burroughs & Hutchinson, Inc.
702 W. Idaho Street
Suite 810
Boise, ID 83702
Dear Sirs:
AmeriPrime Funds (the "Trust") herewith confirms our agreement with
you.
The Trust has been organized to engage in the business of an investment
company. The Trust currently offers several series of shares to investors, one
of which is the Marathon Value Fund (the "Fund").
You have been selected to act as the sole investment adviser of the
Fund and to provide certain other services, as more fully set forth below, and
you are willing to act as such investment adviser and to perform such services
under the terms and conditions hereinafter set forth. Accordingly, the Trust
agrees with you as follows effective upon the date of the execution of this
Agreement.
1. ADVISORY SERVICES
You will regularly provide the Fund with such investment
advice as you in your discretion deem advisable and will furnish a continuous
investment program for the Fund consistent with the Fund's investment objectives
and policies. You will determine the securities to be purchased for the Fund,
the portfolio securities to be held or sold by the Fund and the portion of the
Fund's assets to be held uninvested, subject always to the Fund's investment
objectives, policies and restrictions, as each of the same shall be from time to
time in effect, and subject further to such policies and instructions as the
Board may from time to time establish. You will advise and assist the officers
of the Trust in taking such steps as are necessary or appropriate to carry out
the decisions of the Board and the appropriate committees of the Board regarding
the conduct of the business of the Fund.
2. ALLOCATION OF CHARGES AND EXPENSES
You will pay all operating expenses of the Fund, including the
compensation and expenses of any employees of the Fund and of any other persons
rendering any services to the Fund; clerical and shareholder service staff
salaries; office space and other office expenses; fees and expenses incurred by
the Fund in connection with membership in investment company organizations;
legal, auditing and accounting expenses; expenses of registering shares under
federal and state securities laws, excluding expenses incurred by the Fund in
connection with the organization and initial registration of shares of the Fund;
insurance expenses; fees and expenses of the custodian, transfer agent, dividend
disbursing agent, shareholder service agent, plan agent, administrator,
accounting and pricing services agent and underwriter of the Fund; expenses,
including clerical expenses, of issue, sale, redemption or repurchase of shares
of the Fund; the cost of preparing and distributing reports and notices to
shareholders, the cost of printing or preparing prospectuses and statements of
additional information for delivery to the Fund's current and prospective
shareholders; the cost of printing or preparing stock certificates or any other
documents, statements or reports to shareholders; expenses of shareholders'
meetings and proxy solicitations; advertising, promotion and other expenses
incurred directly or indirectly in connection with the sale or distribution of
the Fund's shares; and all other
<PAGE>
operating expenses not specifically assumed by the Fund.
The Fund will pay brokerage fees and commissions, taxes,
interest, fees and expenses of the non-interested person trustees and such
extraordinary or non-recurring expenses as may arise, including organizational
expenses, and litigation to which the Fund may be a party and indemnification of
the Trust's trustees and officers with respect thereto. You may obtain
reimbursement from the Fund, at such time or times as you may determine in your
sole discretion, for any of the expenses advanced by you, which the Fund is
obligated to pay, and such reimbursement shall not be considered to be part of
your compensation pursuant to this Agreement.
[Notwithstanding anything herein to the contrary, the Fund
will only be liable for organizational expenses when the Fund reaches
$10,000,000 in assets or if the Fund is in existence through October 31, 1998,
and until such time, you are liable for such expenses. You will cause such
expenses to be advanced on behalf of the Fund and may obtain reimbursement from
the Fund after the Fund becomes liable.]
3. COMPENSATION OF THE ADVISER
For all of the services to be rendered and payments to be made
as provided in this Agreement, as of the last business day of each month, the
Fund will pay you a fee at the annual rate of 1.48% of the average value of its
daily net assets.
The average value of the daily net assets of the Fund shall be
determined pursuant to the applicable provisions of the Declaration of Trust of
the Trust or a resolution of the Board, if required. If, pursuant to such
provisions, the determination of net asset value of the Fund is suspended for
any particular business day, then for the purposes of this paragraph, the value
of the net assets of the Fund as last determined shall be deemed to be the value
of the net assets as of the close of the business day, or as of such other time
as the value of the Fund's net assets may lawfully be determined, on that day.
If the determination of the net asset value of the Fund has been suspended for a
period including such month, your compensation payable at the end of such month
shall be computed on the basis of the value of the net assets of the Fund as
last determined (whether during or prior to such month).
4. EXECUTION OF PURCHASE AND SALE ORDERS
In connection with purchases or sales of portfolio securities
for the account of the Fund, it is understood that you will arrange for the
placing of all orders for the purchase and sale of portfolio securities for the
account with brokers or dealers selected by you, subject to review of this
selection by the Board from time to time. You will be responsible for the
negotiation and the allocation of principal business and portfolio brokerage. In
the selection of such brokers or dealers and the placing of such orders, you are
directed at all times to seek for the Fund the best qualitative execution,
taking into account such factors as price (including the applicable brokerage
commission or dealer spread), the execution capability, financial responsibility
and responsiveness of the broker or dealer and the brokerage and research
services provided by the broker or dealer.
You should generally seek favorable prices and commission
rates that are reasonable in relation to the benefits received. In seeking best
qualitative execution, you are authorized to select brokers or dealers who also
provide brokerage and research services (as those terms are defined in Section
28(e) of the Securities Exchange Act of 1934) to the Fund and/or the other
accounts over which you exercise investment discretion. You are authorized to
pay a broker or dealer who provides
<PAGE>
such brokerage and research services a commission for executing a Fund portfolio
transaction which is in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction if you determine in
good faith that the amount of the commission is reasonable in relation to the
value of the brokerage and research services provided by the executing broker or
dealer. The determination may be viewed in terms of either a particular
transaction or your overall responsibilities with respect to the Fund and to
accounts over which you exercise investment discretion. The Fund and you
understand and acknowledge that, although the information may be useful to the
Fund and you, it is not possible to place a dollar value on such information.
The Board shall periodically review the commissions paid by the Fund to
determine if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Fund.
Consistent with the Rules of Fair Practice of the National
Association of Securities Dealers, Inc., and subject to seeking best qualitative
execution as described above, you may give consideration to sales of shares of
the Fund as a factor in the selection of brokers and dealers to execute Fund
portfolio transactions.
Subject to the provisions of the Investment Company Act of
1940, as amended, and other applicable law, you, any of your affiliates or any
affiliates of your affiliates may retain compensation in connection with
effecting the Fund's portfolio transactions, including transactions effected
through others. If any occasion should arise in which you give any advice to
clients of yours concerning the shares of the Fund, you will act solely as
investment counsel for such client and not in any way on behalf of the Fund.
Your services to the Fund pursuant to this Agreement are not to be deemed to be
exclusive and it is understood that you may render investment advice, management
and other services to others, including other registered investment companies.
5. LIMITATION OF LIABILITY OF ADVISER
You may rely on information reasonably believed by you to be
accurate and reliable. Except as may otherwise be required by the Investment
Company Act of 1940 or the rules thereunder, neither you nor your shareholders,
officers, directors, employees, agents, control persons or affiliates of any
thereof shall be subject to any liability for, or any damages, expenses or
losses incurred by the Trust in connection with, any error of judgment, mistake
of law, any act or omission connected with or arising out of any services
rendered under, or payments made pursuant to, this Agreement or any other matter
to which this Agreement relates, except by reason of willful misfeasance, bad
faith or gross negligence on the part of any such persons in the performance of
your duties under this Agreement, or by reason of reckless disregard by any of
such persons of your obligations and duties under this Agreement.
Any person, even though also a director, officer, employee,
shareholder or agent of you, who may be or become an officer, director, trustee,
employee or agent of the Trust, shall be deemed, when rendering services to the
Trust or acting on any business of the Trust (other than services or business in
connection with your duties hereunder), to be rendering such services to or
acting solely for the Trust and not as a director, officer, employee,
shareholder or agent of you, or one under your control or direction, even though
paid by you.
6. DURATION AND TERMINATION OF THIS AGREEMENT
This Agreement shall take effect on the date of its execution,
and shall remain in force for a period of two (2) years from the date of its
execution, and from year to year thereafter, subject to annual approval by (i)
the Board or (ii) a vote of a majority (as defined in the Investment Company
<PAGE>
Act of 1940) of the outstanding voting securities of the Fund, provided that in
either event continuance is also approved by a majority of the trustees who are
not "interested persons," as defined in the Investment Company Act of 1940, of
you or the Trust, by a vote cast in person at a meeting called for the purpose
of voting such approval.
If the shareholders of the Fund fail to approve the Agreement
in the manner set forth above, upon request of the Board, you will continue to
serve or act in such capacity for the Fund for the period of time pending
required approval of the Agreement, of a new agreement with you or a different
adviser or other definitive action; provided that the compensation to be paid by
the Fund to you for your services to and payments on behalf of the Fund will be
equal to the lesser of your actual costs incurred in furnishing such services
and payments or the amount you would have received under this Agreement for
furnishing such services and payments.
This Agreement may, on sixty days written notice, be
terminated with respect to the Fund, at any time without the payment of any
penalty, by the Board, by a vote of a majority of the outstanding voting
securities of the Fund, or by you. This Agreement shall automatically terminate
in the event of its assignment.
7. USE OF NAME
The Trust and you acknowledge that all rights to the name
"Marathon" belongs to you, and that the Trust is being granted a limited license
to use such word in its Fund name or in any class name. In the event you cease
to be the adviser to the Fund, the Trust's right to the use of the name
"Marathon" shall automatically cease on the ninetieth day following the
termination of this Agreement. The right to the name may also be withdrawn by
you during the term of this Agreement upon ninety (90) days' written notice by
you to the Trust. Nothing contained herein shall impair or diminish in any
respect, your right to use the name "Marathon" in the name of, or in connection
with, any other business enterprises with which you are or may become
associated. There is no charge to the Trust for the right to use this name.
8. AMENDMENT OF THIS AGREEMENT
No provision of this Agreement may be changed, waived,
discharged or terminated orally, and no amendment of this Agreement shall be
effective until approved by the Board, including a majority of the trustees who
are not interested persons of you or of the Trust, cast in person at a meeting
called for the purpose of voting on such approval, and (if required under
current interpretations of the Act by the Securities and Exchange Commission) by
vote of the holders of a majority of the outstanding voting securities of the
series to which the amendment relates.
9. LIMITATION OF LIABILITY TO TRUST PROPERTY
The term "AmeriPrime Funds" means and refers to the Trustees
from time to time serving under the Trust's Declaration of Trust as the same may
subsequently thereto have been, or subsequently hereto be, amended. It is
expressly agreed that the obligations of the Trust hereunder shall not be
binding upon any of the trustees, shareholders, nominees, officers, agents or
employees of the Trust personally, but bind only the trust property of the
Trust, as provided in the Declaration of Trust of the Trust. The execution and
delivery of this Agreement have been authorized by the trustees and shareholders
of the Trust and signed by officers of the Trust, acting as such, and neither
such authorization by such trustees and shareholders nor such execution and
delivery by such officers shall be deemed to have been made by any of them
individually or to impose any liability on any of
<PAGE>
them personally, but shall bind only the trust property of the Trust as provided
in its Declaration of Trust. A copy of the Agreement and Declaration of Trust of
the Trust is on file with the Secretary of the State of Ohio.
10. SEVERABILITY
In the event any provision of this Agreement is determined to
be void or unenforceable, such determination shall not affect the remainder of
this Agreement, which shall continue to be in force.
11. QUESTIONS OF INTERPRETATION
(a) This Agreement shall be governed by the laws of the State
of Ohio.
(b) Any question of interpretation of any term or provision of
this Agreement having a counterpart in or otherwise derived from a term or
provision of the Investment Company Act of 1940, as amended (the "Act") shall be
resolved by reference to such term or provision of the Act and to interpretation
thereof, if any, by the United States courts or in the absence of any
controlling decision of any such court, by rules, regulations or orders of the
Securities and Exchange Commission issued pursuant to said Act. In addition,
where the effect of a requirement of the Act, reflected in any provision of this
Agreement is revised by rule, regulation or order of the Securities and Exchange
Commission, such provision shall be deemed to incorporate the effect of such
rule, regulation or order.
12. NOTICES
Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to the other party at such
address as such other party may designate for the receipt of such notice. Until
further notice to the other party, it is agreed that the address of the Trust is
1793 Kingswood Drive, Suite 200, Southlake, Texas 76092, and your address for
this purpose shall be 702 W. Idaho Street, Suite 810, Boise, ID 83702.
13. COUNTERPARTS
This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
14. BINDING EFFECT
Each of the undersigned expressly warrants and represents that
he has the full power and authority to sign this Agreement on behalf of the
party indicated, and that his signature will operate to bind the party indicated
to the foregoing terms.
15. CAPTIONS
The captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
If you are in agreement with the foregoing, please sign the
form of acceptance on the accompanying counterpart of this letter and return
such counterpart to the Trust, whereupon this letter shall become a binding
contract upon the date thereof.
<PAGE>
Yours very truly,
ATTEST: AmeriPrime Funds
By
Name/Title:___________________ Kenneth D. Trumpfheller, President
Dated: ___________, 1997
<PAGE>
ACCEPTANCE
The foregoing Agreement is hereby accepted.
ATTEST: Burrough & Hutchinson, Inc.
By
Name/Title:___________________ Name/Title:____________________
Dated: _____________, 1998
ASA02994-112697-3
<PAGE>
UNDERWRITING AGREEMENT
THIS AGREEMENT is made as of ______________________, by and between
AmeriPrime Funds, an Ohio business trust (the "Trust"), and Omni Financial
Group, LLC, ("Omni") and AmeriPrime Financial Securities, Inc. ("AFS").
WHEREAS, the Trust is an investment company registered under the
Investment Company Act of 1940, as amended (the "Act"); and
WHEREAS, Omni and AFS (each an "Underwriter," collectively the
"Underwriters") are each a broker-dealer registered with the Securities and
Exchange Commission and a member of the National Association of Securities
Dealers, Inc. (the "NASD"); and
WHEREAS, AFS acts as underwriter to the Trust for all series of the Trust
on a non-exclusive basis; and
WHEREAS, the Underwriters and the Trust wish to enter into an agreement
providing for the co-distribution by Underwriters of shares of beneficial
interest (the "Shares") of the series of shares of the Trust listed on Exhibit A
attached hereto, as it may be amended from time to time (the "Series");
NOW, THEREFORE, in consideration of the promises and agreements of the
parties contained herein, the parties agree as follows:
1. Appointment. The Trust hereby appoints Omni and AFS as its
non-exclusive agents for the distribution of the Shares of the Series and Omni
and AFS hereby accept such appointment under the terms of this Agreement. While
this Agreement is in force, neither Underwriter shall sell any Shares of the
Series except on the terms set forth in this Agreement. Notwithstanding any
other provision hereof, the Trust may terminate, suspend or withdraw the
offering of Shares of any Series whenever, in its sole discretion, it deems such
action to be desirable.
<PAGE>
2. Sale and Repurchase of Shares.
(a) Underwriters will each have the right, as agent for the
Trust, to enter into dealer agreements with responsible investment dealers, and
to sell Shares to such investment dealers against orders therefor at the public
offering price (as defined in subparagraph 2(e) hereof) less a discount
determined by AFS which discount shall not exceed the amount of the sales charge
stated in the Trust's effective Registration Statement on Form N-1A under the
Securities Act of 1933, as amended, including the then current prospectus and
statement of additional information (the "Registration Statement"). Upon receipt
of an order to purchase Shares from a dealer with whom an Underwriter has a
dealer agreement, such Underwriter will promptly cause such order to be filled
by the Trust.
(b) Each Underwriter will have the right, as agent for the
Trust, to sell such Shares to the public against orders therefor at the public
offering price.
(c) Each Underwriter will also have the right, as agent for
the Trust, to sell Shares at their net asset value to such persons as may be
approved by the Trustees of the Trust, all such sales to comply with the
provisions of the Act and the rules and regulations of the Securities and
Exchange Commission promulgated thereunder.
(d) Each Underwriter will also have the right to take, as
agent for the Trust, all actions which, in Underwriter's judgment, are necessary
to carry into effect the distribution of the Shares.
(e) The public offering price for the Shares of each Series
(and, with respect to each Series offering multiple classes of Shares, the
Shares of each Class of such Series) shall be the respective net asset value of
the Shares of that Series (or Class of that Series) then in effect, plus any
applicable sales charge determined in the manner set forth in the Registration
Statement or as permitted by the Act and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder. In no event shall any
applicable sales charge exceed the maximum sales charge permitted by the Rules
of Fair Practice of the NASD.
<PAGE>
(f) The net asset value of the Shares of each Series (or Class
of a Series) shall be determined in the manner provided in the Registration
Statement, and when determined shall be applicable to transactions as provided
for in the Registration Statement. The net asset value of the Shares of each
Series (or each Class of a Series) shall be calculated by the Trust or by
another entity on behalf of the Trust. Underwriters shall have no duty to
inquire into or liability for the accuracy of the net asset value per share as
calculated.
(g) On every sale, the Trust shall receive the applicable net
asset value of the Shares promptly, but in no event later than the third
business day following the date on which the Underwriter shall have received an
order for the purchase of the Shares.
(h) Upon receipt of purchase instructions, Underwriter will
transmit such instructions to the Trust or its transfer agent for registration
of the Shares purchased.
(i) Nothing in this Agreement shall prevent Underwriters or
any affiliated person (as defined in the Act) of Underwriters from acting as
underwriter or distributor for any other person, firm or corporation (including
other investment companies) or in any way limit or restrict Underwriters or any
such affiliated person from buying, selling or trading any securities for its or
their own account or for the accounts of others for whom it or they may be
acting; provided, however, that each Underwriter expressly represents that it
will undertake no activities which, in its judgment, will adversely affect the
performance of its obligations to the Trust under this Agreement.
(j) Each Underwriter, as agent of and for the account of the
Trust, may repurchase the Shares at such prices and upon such terms and
conditions as shall be specified in the Registration Statement.
3. Sales of Shares by the Trust or other Underwriter. The Trust
reserves the right to issue any Shares at any time directly to the holders of
Shares ("Shareholders"), to sell Shares through and enter underwriting
agreements with other underwriters, to sell Shares to its Shareholders or to
other persons approved by AFS at not less than net asset value and to issue
Shares in exchange for
<PAGE>
substantially all the assets of any corporation or trust or for the shares
of any corporation or trust.
4. Basis of Sale of Shares. Underwriters do not agree to sell any specific
number of Shares. Each Underwriter, as agent for the Trust, undertakes to sell
Shares on a best efforts basis only against orders therefor.
5. Compliance with NASD and Government Rules.
(a) Each Underwriter will conform to the Rules of Fair
Practice of the NASD and the securities laws of any jurisdiction in which it
sells, directly or indirectly, any Shares.
(b) Each Underwriter, at its own expense, will pay the costs
incurred in establishing and maintaining its relationship with the dealers
selling the Shares. Each Underwriter will require each dealer with whom such
Underwriter has a dealer agreement to conform to the applicable provisions
hereof and the Registration Statement, and neither Underwriter nor any such
dealers shall withhold the placing of purchase orders so as to make a profit
thereby.
(c) Each Underwriter agrees to furnish to the Trust sufficient
copies of any agreements, plans or other materials it intends to use in
connection with any sales of Shares in adequate time for the Trust to file and
clear them with the proper authorities before they are put in use, and not to
use them until so filed and cleared.
(d) Each Underwriter, at its own expense, will qualify as
dealer or broker, or otherwise, under all applicable State or federal laws
required in order that Shares may be sold in such States as may be mutually
agreed upon by the parties.
(e) Neither Underwriter shall make, or permit any
representative, broker or dealer to make, in connection with any sale or
solicitation of a sale of the Shares, any representations concerning the Shares
except those contained in the then current prospectus and statement of
additional information covering the Shares and in printed information approved
by the Trust as information supplemental to such prospectus and statement of
additional information. Copies of the then effective prospectus and statement of
additional information and any such printed supplemental information will
<PAGE>
be supplied by the Trust to Underwriters in reasonable quantities upon request.
6. Records to be Supplied by Trust. The Trust shall furnish to
Underwriters copies of all information, financial statements and other papers
which an Underwriter may reasonably request for use in connection with the
distribution of the Shares, and this shall include, but shall not be limited to,
one certified copy, upon request by an Underwriter, of all financial statements
prepared for the Trust by independent public accountants.
7. Expenses to be Borne by Trust. The Trust will bear the
following expenses: (a) preparation, setting in type, printing
of sufficient copies of the prospectus and
statement of additional information for distribution to shareholders, and
the distribution to shareholders of the prospectus and statement of additional
information;
(b) preparation, printing and distribution of reports and
other communications to shareholders;
(c) registration of the Shares under the federal securities law;
(d) qualification of the Shares for sale in the jurisdictions
designated by Underwriter; (e) qualification of the Trust as a
dealer or broker under the laws of jurisdictions
designated by AFS as well as qualification of the Trust to do business in any
jurisdiction, if AFS determines that such qualification is necessary or
desirable for the purpose of facilitating sales of the Shares;
(f) maintaining facilities for the issue and transfer of the Shares;
(g) supplying information, prices and other data to be furnished by the
Trust under this Agreement; and
(h) any original issue taxes or transfer taxes applicable to
the sale or delivery of the Shares of certificates therefor.
8. Services to and Actions for Trust, Not Underwriter. Any person,
even though also a director, officer, employee, shareholder, member or agent of
an Underwriter, who may be or become
<PAGE>
an officer, trustee, employee or agent of the Trust, shall be deemed, when
rendering services to the Trust or acting on any business of the Trust (other
than services or business in connection with such Underwriter's duties
hereunder), to be rendering such services to or acting solely for the Trust and
not as a director, officer, employee, shareholder, member or agent, or one under
the control or direction of such Underwriter, even though paid by it.
9. Limitation of Liability. Each Underwriter may rely on information
reasonably believed by it to be accurate and reliable. Except as may otherwise
be required by the Act or the rules thereunder, neither Underwriter nor its
respective members, shareholders, officers, directors, employees, agents,
control persons or affiliates of any thereof (collectively, the "Underwriter's
Employees") shall be subject to any liability for, or any damages, expenses or
losses incurred by the Trust in connection with, any error of judgment, mistake
of law, any act or omission in connection with or arising out of any services
rendered under or payments made pursuant to this Agreement or any other matter
to which this Agreement relates, except by reason of willful misfeasance, bad
faith or gross negligence on the part of any such persons in the performance of
the duties of the Underwriter under this Agreement or by reason of reckless
disregard by any of such persons of the obligations and duties of the
Underwriter under this Agreement.
10. Indemnification of Underwriter. Subject to and except as otherwise
provided in the Securities Act of 1933, as amended, and the Act, the Trust shall
indemnify each Underwriter and each Underwriter's Employees (hereinafter
referred to as a "Covered Person") against all liabilities, including but not
limited to amounts paid in satisfaction of judgments, in compromise or as fines
and penalties, and expenses, including reasonable accountants' and counsel fees,
incurred by any Covered Person in connection with the defense or disposition of
any action, suit or other proceeding, whether civil or criminal, before any
court or administrative or legislative body, in which such Covered Person may be
or may have been involved as a party or otherwise or with which such person may
be or may have been threatened, while serving as the underwriter for the Trust
or as one of Underwriter's
<PAGE>
Employees, or thereafter, by reason of being or having been the underwriter for
the Trust or one of Underwriter's Employees, including but not limited to
liabilities arising due to any misrepresentation or misstatement in the Trust's
prospectus, other regulatory filings, and amendments thereto, or in other
documents originating from the Trust. In no case shall a Covered Person be
indemnified against any liability to which such Covered Person would otherwise
be subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties of such Covered Person.
11. Advances of Expenses. The Trust shall advance attorneys' fees or
other expenses incurred by a Covered Person in defending a proceeding to the
full extent permitted by the Securities Act of 1933, as amended, and the Act.
12. Termination and Amendment of this Agreement. This Agreement shall
automatically terminate, without the payment of any penalty, in the event of its
assignment. This Agreement may be amended only if such amendment is approved (i)
by Omni, (ii) by AmeriPrime, (iii) either by action of the Board of Trustees of
the Trust or at a meeting of the Shareholders of the Trust by the affirmative
vote of a majority of the outstanding Shares, and (iv) by a majority of the
Trustees of the Trust who are not interested persons of the Trust or of an
Underwriter, by vote cast in person at a meeting called for the purpose of
voting on such approval. Either the Trust or an Underwriter may at any time
terminate this Agreement on sixty (60) days' written notice delivered or mailed
by registered mail, postage prepaid, to the other party.
13. Effective Period of this Agreement. This Agreement shall take
effect upon its execution and shall remain in full force and effect for a period
of two years from the date of its execution (unless terminated automatically as
set forth in Paragraph 12, and from year to year thereafter), subject to annual
approval (i) each Underwriter, (ii) by the Board of Trustees of the Trust or a
vote of a majority of the outstanding Shares, and (iii) by a majority of the
Trustees of the Trust who are not interested persons of the Trust or of an
Underwriter, by vote cast in person at a meeting called for the purpose of
voting on such approval.
<PAGE>
14. Limitation of Trust's Liability. The term "AmeriPrime Funds" means
and refers to the Trustees from time to time serving under the Trust's
Declaration of Trust as the same may subsequently thereto have been, or
subsequently hereto be, amended. It is expressly agreed that the obligations of
the Trust hereunder shall not be binding upon any of the Trustees, Shareholders,
nominees, officers, agents or employees of the Trust, personally, but bind only
the trust property of the Trust, as provided in the Declaration of Trust of the
Trust. The execution and delivery of this Agreement have been authorized by the
Trustees and Shareholders of the Trust and signed by the officers of the Trust,
acting as such, and neither such authorization by such Trustees and Shareholders
nor such execution and delivery by such officers shall be deemed to have been
made by any of them individually or to impose any liability on them personally,
but shall bind only the trust property of the Trust as provided in its
Declaration of Trust. A copy of the Agreement and Declaration of Trust of the
Trust is on file with the Secretary of State of Ohio.
15. Successor Investment Company. Unless this Agreement has been
terminated in accordance with Paragraph 13, the terms and provisions of this
Agreement shall become automatically applicable to any investment company which
is a successor to the Trust as a result of a reorganization, recapitalization or
change of domicile.
16. Severability. In the event any provision of this Agreement is
determined to be void or unenforceable, such determination shall not affect the
remainder of this Agreement, which shall continue to be in force.
17. Questions of Interpretation.
(a) This Agreement shall be governed by the laws of the State of Ohio.
(b) Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the Act shall be resolved by reference to such term or provision of the Act
and to interpretation thereof, if any, by the United States courts or in the
absence of any controlling decision of any such court, by rules, regulations or
<PAGE>
orders of the Securities and Exchange Commission issued pursuant to said Act. In
addition, where the effect of a requirement of the Act, reflected in any
provision of this Agreement is revised by rule, regulation or order of the
Securities and Exchange Commission, such provision shall be deemed to
incorporate the effect of such rule, regulation or order.
18. Notices. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to the other party at such
address as such other party may designate for the receipt of such notice. Until
further notice to the other party, it is agreed that for this purpose the
address of the Trust and AFS shall be 1793 Kingswood Drive, Suite 200,
Southlake, Texas 76092 and of Omni shall be 6575 West Loop South, Suite 125,
Bellaire, Texas 77401.
19. Counterparts. This Agreement may be in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
20. Binding Effect. Each of the undersigned expressly warrants and
represents that he has the full power and authority to sign this Agreement on
behalf of the party indicated, and that his signature will operate to bind the
party indicated to the foregoing terms.
21. Force Majeure. If an Underwriter shall be delayed in its
performance of services or prevented entirely or in part from performing
services due to causes or events beyond its control, including and without
limitation, acts of God, interruption of power or other utility, transportation
or communication services, acts of civil or military authority, sabotages,
national emergencies, explosion, flood, accident, earthquake or other
catastrophe, fire, strike or other labor problems, legal action, present or
future law, governmental order, rule or regulation, or shortages of suitable
parts, materials, labor or transportation, such delay or non-performance shall
be excused and a reasonable time for performance in connection with this
Agreement shall be extended to include the period of such delay or
non-performance.
IN WITNESS WHEREOF, the parties have each caused this Agreement to be
signed on its behalf, all as of the day and year first above written.
<PAGE>
ATTEST: AmeriPrime Funds
- -----------------------------
By:________________________________
Kenneth D. Trumpfheller, President
ATTEST: Omni Financial Group, LLC
____________________________ By:_________________________________
Qui T. Vuong, Member
ATTEST: AmeriPrime Financial Securities, Inc.
- -----------------------------
By:________________________________
Kenneth D. Trumpfheller, President
ASA02CF3-121097-1
<PAGE>
EXHIBIT A
TO THE UNDERWRITING AGREEMENT
DATED __________________, 1997
MAI ENHANCED EQUITY BENCHMARK FUND
MAI ENHANCED AGGRESSIVE GROWTH FUND
MAI ENHANCED CAPITAL APPRECIATION FUND
MAI ENHANCED GROWTH & INCOME FUND
MAI ENHANCED INCOME FUND
MAI ENHANCED GLOBAL FUND
ASA02CF3-112197-2
THE CARL DOMINO EQUITY INCOME FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 12/5/95
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
DATE OF DECLARATION 12/27/96
DIVIDEND RATE 0.22
NAV @REINVEST 12.69
DOLLAR VALUE 220.00
SHARES PURCHASED 17.34
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,017.34
ENDING NAV 16.15
ENDING ERV 16,429.98
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 12/5/95 P= 10,000.00
ENDING 10/31/97 ERV= 16,429.98
CUMULATIVE RETURN 0.642998 N= 0.524439
AVERAGE ANNUAL 29.74%
AIT VISION U.S. EQUITY PORTFOLIO
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 35,061.00
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
DATE OF DECLARATION 12/27/96
DIVIDEND RATE 1.60
NAV @REINVEST 11.30
DOLLAR VALUE 1,600.00
SHARES PURCHASED 141.59
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,141.59
ENDING NAV 13.79
ENDING ERV 15,742.57
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 12/5/95 P= 10,000.00
ENDING 10/31/97 ERV= 15,742.57
CUMULATIVE RETURN 0.574257 N= 0.542358
AVERAGE ANNUAL 27.90%
GLOBALT GROWTH FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 12/1/95
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
DATE OF DECLARATION 12/27/96
DIVIDEND RATE 0.17
NAV @REINVEST 12.80
DOLLAR VALUE 170.00
SHARES PURCHASED 13.28
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,013.28
ENDING NAV 13.79
ENDING ERV 13,973.15
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 12/1/95 P= 10,000.00
ENDING 10/31/97 ERV= 13,973.15
CUMULATIVE RETURN 0.397315 N= 0.521431
AVERAGE ANNUAL 19.06%
NEW CAP CONTRARIAN FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 5/2/97
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
NONE DECLARED
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,000.00
ENDING NAV 8.76
ENDING ERV 8,760.00
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 8/5/96 P= 10,000.00
ENDING 10/31/97 ERV= 8,760.00
CUMULATIVE RETURN -0.124 N= 0.667289
AVERAGE ANNUAL -8.46%
IMS CAPITAL VALUE FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 35,282.00
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
NONE DECLARED
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,000.00
ENDING NAV 12.06
ENDING ERV 12,060.00
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 8/5/96 P= 10,000.00
ENDING 10/31/97 ERV= 12,060.00
CUMULATIVE RETURN 0.206 N= 0.524439
AVERAGE ANNUAL 10.32%
FOUNTAINHEAD SPECIAL VALUE FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 12/31/96
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
NONE DECLARED
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,000.00
ENDING NAV 13.37
ENDING ERV 13,370.00
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 5/2/97 P= 10,000.00
ENDING 10/31/97 ERV= 13,370.00
CUMULATIVE RETURN 0.337 N= 1.196745
AVERAGE ANNUAL 41.56%
CORBIN SMALL CAP VALUE FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 12/31/96
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
NONE DECLARED
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,000.00
ENDING NAV 11.03
ENDING ERV 11,030.00
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 6/30/97 P= 10,000.00
ENDING 10/31/97 ERV= 11,030.00
CUMULATIVE RETURN 0.103 N= 2.943514
AVERAGE ANNUAL 33.45%
FLORIDA STREET GROWTH FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 8/6/97
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
NONE DECLARED
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,000.00
ENDING NAV 10.19
ENDING ERV 10,190.00
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 8/6/97 P= 10,000.00
ENDING 10/31/97 ERV= 10,190.00
CUMULATIVE RETURN 0.019 N= 4.194631
AVERAGE ANNUAL 8.22%
FLORIDA STREET BOND FUND
PERFORMANCE DATA (STANDARDIZED)
ENDING REDEEMABLE VALUE (ERV)
10/31/97
DATE OF INVESTMENT 8/4/97
INITIAL INVESTMENT 10,000.00
SALES LOAD PERCENTAGE 0.00
NAV @ PURCHASE DATE 10.00
SHARES PURCHASED 1,000.00
DIVIDENDS DECLARED
DATE OF DECLARATION 10/31/97
DIVIDEND RATE 0.14
NAV @REINVEST 9.93
DOLLAR VALUE 140.00
SHARES PURCHASED 14.10
ENDING DATE 10/31/97
ENDING SHARES OWNED 1,014.10
ENDING NAV 9.95
ENDING ERV 10,090.28
AVERAGE ANNUAL TOTAL RETURN PURSUANT TO SEC RULES
ACTIVE DATES 8/4/97 P= 10,000.00
ENDING 10/31/97 ERV= 10,090.28
CUMULATIVE RETURN 0.009028 N= 4.147829
AVERAGE ANNUAL 3.80%
