THE JUMPER STRATEGIC ADVANTAGE FUND
PROSPECTUS July 15, 1998
One Union Square
Suite 505
Chattanooga, TN 37402
For Information, Shareholder Services and Requests:
(888) 879-5723
The Jumper Strategic Advantage Fund (AFund@) seeks a greater total return than
may generally be earned in money market funds while attempting to limit general
market risk. The Fund is not a money market fund, an investment in the Fund may
be subject to losses, and the Fund's net asset value per share will fluctuate.
The Advisor will manage a portfolio consisting primarily of short term fixed
income securities, underlying funds commonly referred to as Ahedge funds,@ and
"market neutral" mutual funds. The underlying funds are not subject to the same
regulatory oversight and investment restrictions that mutual funds are.
The Fund may be suitable for sophisticated investors wishing to limit general
market risk but willing to accept security selection risk for an opportunity to
achieve a total return exceeding that earned by money market funds investing
primarily in investment grade cash instruments. The Fund may experience losses
if the Advisor is not successful in limiting market risk, selecting appropriate
securities to purchase and appropriate securities to sell short, and selecting
appropriate underlying funds and mutual funds to invest in. In addition, the
Fund may employ certain strategic investment strategies which could also expose
the Fund to losses.
The Jumper Strategic Advantage Fund is "no-load," which means there are no sales
charges or commissions. In addition, there are no 12b-1 fees, distribution
expenses or deferred sales charges which are borne by the shareholders. The Fund
is a separate series of AmeriPrime Funds, an open-end management investment
company, and is 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 has been filed with the Securities and Exchange
Commission dated July 15, 1998, which 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.
ASA03058-061898-0
<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. 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 0.75%
12b-1 Charges None
Other Expenses2 0.00%
Total Fund Operating Expenses 0.75%
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 .00032 of 1% of average net assets for the first
fiscal year.
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.
Example
You would pay the following expenses on a $1,000 investment, assuming (1)
5% annual return and (2) redemption at the end of each time period:
1 year ...........................................$ 8
3 years ..........................................$24
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THE FUND
The Jumper Strategic Advantage Fund (the "Fund") was organized as a
series of AmeriPrime Funds, an Ohio business trust (the "Trust"), on February
26, 1998, and commenced operations on July 15, 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 The Jumper Group,
Inc. (the "Advisor").
INVESTMENT OBJECTIVE
The Fund seeks a greater total return than may generally be earned in
money market funds while attempting to limit general market risk. The Fund is
not a money market fund, an investment in the Fund may be subject to losses, and
the Fund's net asset value per share will fluctuate. Of course, there can be no
assurance that the Fund will achieve its investment objective.
The Advisor will manage a portfolio consisting primarily of short term
fixed income securities, underlying funds commonly referred to as Ahedge funds,@
and "market neutral" mutual funds. A market neutral fund is a mutual fund that
pursues a market neutral investment strategy. The underlying funds are not
subject to the same regulatory oversight and investment restrictions that mutual
funds are.
The Fund may be suitable for sophisticated investors wishing to limit
general market risk but willing to accept security selection risk for an
opportunity to achieve a total return exceeding that earned by money market
funds investing in investment grade cash instruments. The Fund may experience
losses if the Advisor is not successful in limiting market risk, selecting
appropriate securities to purchase and appropriate securities to sell short, and
selecting appropriate underlying funds and mutual funds to invest in.
The Fund's investment strategies and portfolio investments will differ
from those of most other mutual funds. The Advisor seeks rigorously to identify
favorable investment opportunities in underlying funds that other investors may
not have identified and may be unable to invest in..
During normal market conditions the Fund invests primarily in domestic,
investment grade, short-term fixed income securities and underlying funds
pursuing market neutral investment strategies (or which when combined in a
portfolio the Advisor believes will result in market neutrality for the
underlying funds)(see "Market Neutral Investing" below). The Fund may also
invest without limitation in other mutual funds pursuing market neutral
investment strategies. The Advisor may seek to further the Fund's investment
objectives by engaging in strategic investment techniques.
INVESTMENT STRATEGY
The Fund's investment portfolio is built around a core of selected
underlying funds and market neutral mutual funds selected by the Advisor based
upon their ability to perform well in any market environment; including rising
or falling stock markets and rising or falling interest rates. The Fund
anticipates that the underlying funds selected as core investments will be held
long term and substantially contribute to the Fund's gains and losses.
Underlying funds and market neutral mutual funds selected as core investments
may seek to achieve market neutrality through the use of strategic transactions,
including short selling, futures contracts, and options. The Fund may also
invest in underlying funds which do not directly pursue a market neutral
strategy, but which may contribute to the Fund's overall market neutrality when
added to the Fund's existing portfolio. Due to legal limitations, product
availability, pricing issues, and the need to maintain adequate liquidity, the
Fund may be limited in the amount of its assets which it may invest in suitable
underlying funds.
In addition to the core of selected underlying funds and market neutral
mutual funds, the Fund will generally invest in short-term (maturing or having
coupons which reset in three years or less) investment grade fixed income
securities including, but not limited to, securities issued by the U.S.
Government or its agencies, commercial paper, certificates of deposit, floating
rate securities, asset-backed securities, and repurchase agreements. The only
fixed income securities which the Fund will invest in are those earning one of
the four highest ratings by Moody's Investor's Services (Aaa, Aa, A, Baa) or by
Standard & Poor's Corporation (AAA, AA, A, BBB), or if unrated by either of
these services, which the Advisor believes to be of comparable credit quality.
Investments in the fourth credit category may have speculative characteristics
and, therefore, may involve higher risks. If a fixed income security which the
Fund owns is downgraded below investment grade, then the Fund will dispose of
the security in an orderly fashion, unless the Board of Trustees finds that
disposal of the security would not be in the best interests of the Fund. The
Fund's investments in short term fixed income securities will be subject to
market risk (if interest rates increase, the value of those securities will
decrease).
The Fund may also engage in strategic transactions using derivative
securities designed to preserve principal, hedge market risks or enhance the
market neutrality of the Fund.
Market Neutral Investing. The goal of market neutral investing is to
achieve consistent real returns which are indifferent to stock and bond market
direction, usually by simultaneously establishing equal weightings in long and
short positions. If successful, investors will earn a total return which is
approximately 1% (100 basis points) above that earned on general purpose money
market funds, regardless of whether the general markets rise or fall. Because of
its investments in short term fixed income securities, the Fund will not be
entirely market neutral.
A market neutral investment strategy is not risk free. While an
investor's returns would not be influenced by the rise or fall of the general
market, the investor would experience gains or losses depending upon the
manager's ability to purchase a portfolio of long securities which will increase
in value more (or decline less) than a companion portfolio of securities which
the manager has sold short.
The typical investor owning a diversified portfolio of stocks and bonds
experiences both general market risk and security selection risk. The typical
investor makes money when the general market rises and loses money when the
general market falls. This is general market risk. A manager's success or
failure to select specific stocks and bonds which will outperform the general
market is security selection risk.
The market neutral investor seeks to limit market risk and retain only
security selection risk. The investor's gains or losses will depend not on the
direction of the general market but upon the manager's ability to construct a
portfolio of long securities which will increase in value more (or decline less)
than a companion portfolio of securities which the manager has sold short. If
the manager is not successful, then the investor may experience losses
regardless of whether the general market is rising or falling.
The market neutral investor must also accept the risk that the manager
will not be able to maintain a market neutral portfolio. If the manager is not
successful in balancing the long and short portfolios, then the investor will
experience gains or losses as the general market rises or falls. If the general
market were rising and the long portfolio were overweighted, the investor would
experience gains. Conversely, if the general market were rising and the short
portfolio were overweighted, the investor would experience losses. If the
general market were falling then the investor's gains and losses based upon
whether the long or short portfolio were overweighted would be reversed.
Maintaining long and short portfolios equal in value requires constant
vigilance by the manager. Adjusting the portfolios may lead to higher turnover,
leading to increased brokerage commissions, short term gains and losses, and
potentially taxes due on net capital gains. All of these factors may decrease
the Fund's total return.
The success of a market neutral investment strategy depends upon
correctly assessing the future course of a relationship between the price
movement of securities purchased long and those sold short. There is no
assurance that either the Advisor, or the underlying funds in which the Fund
invests will be able to do so. While the Fund generally will attempt to remain
market neutral, a substantial risk remains that such techniques will not always
be possible to implement, and when possible, will not always be effective in
limiting losses. There can be no assurance the Fund will be able to outperform
money market funds or that the Fund will avoid losses. In addition, it should be
noted that the Advisor has not previously managed assets organized as a mutual
fund, that the Advisor has not previously managed accounts investing in
underlying funds and that 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.
Underlying funds. The Fund may invest in domestic and foreign pooled
investment companies which invest principally in domestic fixed income and
equity securities. Underlying funds are sometimes referred to as Ahedge funds@
or Aoffshore funds@. Underlying funds are usually structured to avoid the
regulatory review which mutual funds are subject to. The Fund will not invest in
underlying funds which invest primarily in commodities, foreign securities, or
currencies. While most underlying funds selected by the Advisor are expected to
pursue market neutral investment strategies, the Fund may invest in other
underlying funds which do not pursue market neutral investment strategies which
may contribute to the Fund's overall market neutrality when added to the Fund's
existing portfolio. Underlying funds are prohibited from publicly advertising in
the United States and may be purchased directly only by wealthy individuals and
institutional investors. Underlying funds typically impose restrictions on when
an investor may redeem its interests and no organized public market exists to
dispose of the interests. Like other illiquid securities, investments in
underlying funds are more difficult to value than are traditional stocks and
bonds. The Fund has established special valuation procedures dealing
specifically with underlying funds.
Underlying funds are not subject to many of the investment limitations
imposed by federal law on mutual funds and thus may engage in a broader array of
investment strategies. These investment strategies may include, but are not
limited to, leveraging, lack of diversification, extensive use of derivative
securities, investments in foreign markets, and rapid trading of portfolio
securities. This greater flexibility increases both the potential returns and
risks of investments in underlying funds.
Much of the success of the Fund will depend on the Advisor's ability to
identify and invest in underlying funds which will successfully pursue market
neutral investment strategies and deliver the desired total returns. The Fund
may invest either in established underlying funds or in underlying funds which
have recently been formed and have not yet established a track record. The
Advisor will select underlying funds based upon its assessment of the investment
strategies pursued by those funds. However, there is no assurance that the
underlying funds selected will perform up to the Advisor's expectations.
Moreover, the underlying funds may not continue to pursue the investment
strategies which the Advisor believed they would when making the decision to
invest.
Underlying funds often pay their advisers an advisory fee which is
based upon the fund's performance. The adviser is rewarded for superior
performance by receiving higher fees. These fees may be substantially higher
than those typically earned by mutual fund advisers. The return which the Fund
earns on its investment in underlying funds will be reduced by fees which the
underlying funds pay to their advisers. To the extent that the Fund invests its
assets in underlying funds, Fund shareholders will be paying an additional layer
of advisory fees.
Most domestic underlying funds are organized as limited partnerships
which issue both limited and general partnership interests. Many foreign
underlying funds, and some domestic underlying funds are organized as business
trusts, corporations, or other legal entities. When investing in underlying
funds, the Fund only purchases the limited interest of a limited partnership (or
the equivalent interest in a business trust or other entity), which provides
some protection in the event the particular underlying fund experiences
financial difficulties.
Underlying funds typically impose restrictions on when an investor may
redeem its interests and no organized public market exists to dispose of the
interests. As a result investments in underlying funds are usually illiquid. The
Fund limits its total investments in all illiquid securities, including
underlying funds (and over the counter options), to no more than 15% of its net
assets. The Fund may negotiate redemption privileges with underlying funds which
improve their liquidity. If such redemption privileges are negotiated, the Fund
may treat investments in such underlying funds as liquid investments pursuant to
liquidity procedures which are periodically reviewed by the Board of Trustees.
Subject to liquidity requirements, the Fund could invest up to 100% of its
assets in underlying funds if it did not purchase more than 3% of the total
market value of any single underlying fund. If, however, the Fund desires to
make a more substantial investment in a smaller underlying fund, then,
immediately after the purchase of an interest in a smaller underlying fund the
Fund will not:
(i) own more than 3% of the total outstanding voting securities of the
underlying fund (the Fund typically purchases limited partnership interests,
which do not have voting rights):
(ii) invest more than 5% of its total assets in a single underlying
fund; or
(iii) invest more than 10% of its total assets in all underlying funds
combined .
In addition, the Fund is subject to the portfolio diversification
requirements described later in this prospectus.
Leveraging. Despite the relatively small investment in underlying
funds, the Advisor expects that they will have a disproportionate impact on the
Fund's investment performance due to the highly leveraged nature of underlying
funds' investment strategies. The investment results earned by the Fund will
depend in a large degree upon the Advisor's ability to select appropriate
underlying funds.
Long-Term Fixed Income Securities and Equity Securities. While the Fund
will not invest directly in long-term fixed income or equity securities, the
underlying funds in which the Fund invests will own these securities and the
Fund will be exposed to market risk. Investment in fixed income and equity
securities are subject to inherent market risks beyond the control of the
Advisor or the underlying funds. As a result, the return and net asset value of
the Fund will fluctuate.
The underlying funds may invest in an unlimited array of domestic
fixed income securities including U.S. Government and agency bonds, investment
grade and non-investment grade corporate bonds, asset-backed securities, and
lower rated fixed income securities (AJunk Bonds@). Fixed income securities,
including both investment grade and high yield bonds, are subject to price
fluctuations based on changes in the level of interest rates, which will
generally result in these securities changing in price in the opposite
direction. That is, these securities will experience appreciation when interest
rates decline and will depreciate when interest rates rise. In addition,
specific fixed income securities are subject to many other risks, including
pre-payment risks for asset-backed securities, call risk for callable bonds,
credit downgrades for corporate bonds, and default risk for Junk Bonds.
The underlying funds may invest in an unlimited array of domestic
equity securities including common stock, preferred stock, convertible stocks
and bonds, and warrants to purchase equity securities. Equity securities may
fluctuate in value due to earnings, economic conditions, quality ratings,
interest rates and other factors. For example, an underlying fund may invest in
small companies. Small companies present special risks, including difficulties
in obtaining the capital necessary to continue in operation and may become
insolvent, which may result in a complete loss of the underlying fund's
investment in such companies. Or an underlying fund may purchase equity
securities in private placements, making it difficult to dispose of shares when
it may otherwise be advisable.
Foreign Securities. The Fund invests in underlying funds which invest
principally in domestic fixed income and equity securities. The underlying funds
may invest a portion of their assets in foreign securities. Investments in
foreign securities, whether in emerging or more developed countries, are subject
to risks and uncertainties not typically associated with investments in domestic
securities. These risks and uncertainties include currency exchange rates and
exchange control regulations, less publicly available information, different
accounting and reporting standards, less liquid markets and more volatile
markets, higher brokerage commissions and other fees, the possibility of
nationalization or expropriation, confiscatory taxation, political instability
and less protection provided by the judicial system.
Market Neutral Mutual Funds. The Fund may invest in other mutual funds
that pursue market neutral investment strategies. Much of the success of the
Fund will depend on the Advisor's ability to identify market neutral funds that
will successfully pursue market neutral investment strategies and deliver the
desired total returns. As is the case with the underlying funds, there is no
assurance that the mutual funds selected will perform well, or that the mutual
funds will continue to pursue the investment strategies which the Advisor
believed they would when making the decision to invest. If the Fund acquires
securities of another mutual fund, the shareholders of the Fund will be subject
to additional management fees and expenses.
Repurchase Agreements. Repurchase Agreements are agreements by which a
person obtains a security and simultaneously commits to return the security to
the seller at an agreed upon price (including principal and interest) on an
agreed upon date within a number of days from the date of purchase. The
custodian or its agent will hold the security as collateral for the repurchase
agreement. Collateral must be maintained at a value at least equal to 102% of
the purchase price. The Fund bears a risk of loss in the event the other party
defaults on its obligations and the Fund is delayed or prevented from its right
to dispose of the collateral securities or if the Fund realizes a loss on the
sale of the collateral securities. The Fund will enter into repurchase
agreements on behalf of the Fund only with financial institutions deemed to
present minimal risk of bankruptcy during the term of the agreement based on
guidelines established and periodically reviewed by the Advisor.
Strategic Investments. Both the Fund and the underlying funds may, but
are not required to, use various other investment strategies as described below.
These strategies are generally accepted as modern portfolio management
techniques and are regularly used by many mutual funds and other institutional
investors. Techniques and instruments may change over time as new instruments
and strategies are developed or regulatory changes occur. While pursuing these
investment strategies, the Fund may purchase and sell exchange-listed and
over-the-counter put and call options on securities, equity and fixed-income
indexes and other financial instruments; and financial futures contracts and
options thereon. In addition, the Fund may borrow securities and sell them short
to hedge against rising interest rates. Collectively, all the above, and other
transactions involving derivative instruments, are called strategic
transactions.
The Fund, and the underlying funds in which the Fund invests a portion
of its assets, may engage in strategic transactions for hedging, risk
management, or portfolio management purposes, or in an attempt to increase
investment returns. Strategic transactions may be used to attempt to protect
against possible changes in the market value of securities held in, or to be
purchased for, the portfolio. Such changes may result from securities markets
fluctuations. Strategic transactions may be used to attempt to protect
unrealized gains or prevent losses in the value of its portfolio securities, or
to establish a position using strategic transactions as a temporary substitute
for purchasing or selling particular securities. When used in an attempt to
increase investment returns, strategic transactions may result in leveraging of
the Fund's exposure to market fluctuations, increasing the likelihood that the
Fund may incur a loss on the transaction.
Short-selling exposes the seller to unlimited risk with respect to the
security sold short due to the lack of an upper limit on the price to which a
security can rise. The ability of the Fund to use these strategic transactions
successfully will depend upon the Advisor's ability to predict pertinent market
movements, which cannot be assured. Engaging in strategic transactions will
increase transaction expenses and may result in a loss that exceeds the
principal invested in the transaction. The Fund may sell short up to 100% of its
net assets. When selling securities short, regulatory requirements require the
Fund segregate liquid marketable securities on its books or with its custodian.
A detailed description of segregation requirements is provided in the Statement
of Additional Information.
Among other risks, futures contracts and options may not correlate
perfectly with the underlying security, resulting in an imperfect hedge; and a
secondary market may not always exist for the Fund's investments in options,
making it difficult or impossible for the Fund to dispose of the futures
contract or option without recognizing a significant loss.
OTHER INVESTMENT PRACTICES AND LIMITATIONS
Temporary Defensive Investments. For temporary defensive purposes
during periods that, in the Advisor's opinion, present the Fund with adverse
changes in the economic, political or securities markets, the Fund may seek to
protect the capital value of its assets by temporarily investing up to 100% of
its assets in short-term debt instruments including treasury bills, investment
grade commercial paper, certificates of deposit, or repurchase agreements.
Portfolio Turnover. The length of time the Fund has held a particular
security is not generally a consideration in investment decisions. It is the
policy of the Fund to effect portfolio transactions without regard to its
holding period if, in the judgment of the Advisor, such transactions are
advisable. Portfolio turnover generally involves some expense, including
brokerage commissions, dealer mark-ups or other transaction costs on the sale of
securities and reinvestment in other securities. Such sales may result in
realization of taxable capital gains. The portfolio turnover of the Fund is not
expected to exceed 100%, but volatile market conditions may lead to a much
higher portfolio turnover rate.
Borrowing and Leverage. As a fundamental policy that cannot be changed
without a vote by shareholders, the Fund may borrow up to 33 1/3% of its total
assets (reduced by the amount of all liabilities and indebtedness other than
such borrowings) when deemed desirable or appropriate by the Advisor. Such
borrowing may be used either to meet redemption requests or to purchase
additional portfolio securities, thereby leveraging the Fund's investments. At
such times, the Fund' investment portfolio may appreciate or depreciate more
rapidly than an unleveraged portfolio. The Fund will pay interest upon the money
it borrows which will increase its operating expenses. Moreover, the Fund may be
forced to sell portfolio securities at unfavorable prices in order to repay the
borrowed money.
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 (usually 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.
The Funds' portfolio of securities are valued primarily on market
quotations, where available. Securities for which current market quotations are
not readily available, including the current market value of underlying funds,
are valued at fair value as determined in good faith by procedures approved by
the Funds' board of trustees. Short-term investments maturing in sixty days or
less are valued at amortized cost, which approximates fair market value.
HOW TO INVEST IN THE FUND
Shares of the Fund are sold on a continuous basis, and you may invest
any amount you choose, as often as you wish, subject to a minimum initial
investment of $5,000 ($2,000 for IRAs and other retirement plans) and minimum
subsequent investments of $100. 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 The Jumper Strategic Advantage Fund, and sent to the address
listed below.
U.S. Mail: Overnight:
The Jumper Strategic Advantage Fund The Jumper Strategic Advantage Fund
c/o Unified Fund Services, Inc. c/o Unified Fund Services, Inc.
P.O. Box 6110 431 North Pennsylvania Street
Indianapolis, Indiana 46204-6110 Indianapolis, Indiana 46204
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 888-879-5723 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: The Jumper Strategic Advantage Fund
D.D.A. # 488920992
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. Shares may
be purchased through a broker dealer or other financial institution authorized
by the Distributor to hold shares in an omnibus account. Investors may be
charged a fee by the broker dealer or other financial institution for this
service. 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 The Jumper Strategic Advantage Fund and should be sent to the
Custodian's address. A bank wire should be sent as outlined above.
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); 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 adviser 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.
By Mail - You may redeem any part of your account in the Fund at no charge
by mail. Your request should be addressed to:
The Jumper Strategic Advantage Fund
c/o Unified Fund Services, Inc.
P.O. Box 6110
Indianapolis, Indiana 46204-6110
"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 Unified Fund 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 (888) 879-5723. 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 (888) 879-5723. 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.
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 $5,000 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 adviser 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.
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
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 advisers 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 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.
PERFORMANCE INFORMATION
The Fund may advertise information regarding its performance including
its "yield", "average annual total return", and "total return". The performance
figures are based upon historical results and are not intended to indicate
future performance.
The "yield" of the Fund is computed by dividing the net investment
income per share (a defined in applicable regulations of the Securities and
Exchange Commission) during a specified 30-day period by the net asset value per
share on the last day of such period. Yield is an annualized figure, in that it
assumes that the same level of net investment income is generated over a
one-year period. The yield formula annualizes net investment income by providing
for semi-annual compounding.
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 annual total
return" assumes the reinvestment of all dividends and distributions.
The "total return" of the Fund refers to the compounded rate of return
over a stated period that would equate an initial amount invested at the
beginning of the period to the ending redeemable value of the investment over
various periods. Total return is not annualized. The computation of total return
assumes no activity in the account other than reinvestment of dividends and
capital gains distributions. In addition, a table showing the performance of an
assumed investment of $10,000 may be used from time to time.
The Fund may also include in advertisements data comparing performance
with other mutual funds, including money market 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 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 cash
equivalent market in general. For example, the Fund may use the Donahue Money
Market Index, 90 day treasury bills, or other money market index published by an
independent third party.
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.
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 The Jumper Group, Inc. One Union Square
Suite 505, Chattanooga, TN 37402 (the "Advisor") to manage the Fund's
investments. The Advisor is an independent investment advisor that provides
fixed income management for both taxable and tax-exempt clients and currently
manages approximately $75 million in assets. The Fund is the first mutual fund
managed by the Advisor. The Advisor is a Tennessee corporation controlled by Jay
Colton Jumper, the President, Director and sole shareholder of the Advisor. Mr.
Jumper is primarily responsible for the day-to-day management of the Fund's
portfolio. Mr. Jumper has served as the Advisor's Chairman and President since
its founding in 1994. Mr. Jumper served with SunTrust Banks from 1988 to 1994 as
a Senior Trust Investment Officer. Since January, 1994, Mr. Jumper has been
president of The Jumper Group, Inc.
The Fund is authorized to pay the Advisor a fee equal to 0.75% of its
average daily net assets. The Advisor pays all of the operating expenses of the
Fund except brokerage, taxes, interest, fees and expenses on 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, including transfer agency,
pricing, custodial, auditing and legal services, and general administrative and
other operating expenses 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 Advisor 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 Unified Fund Services, Inc., 431 North Pennsylvania Street,
Indianapolis, Indiana 46204 (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, 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.
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.
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.
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, Jay Jumper purchased for
investment all of the outstanding shares of the Fund. As a result, Jay Jumper
may be deemed to control the Fund.
Investment Advisor Administrator
The Jumper Group, Inc. AmeriPrime Financial Services, Inc.
One Union Square, Suite 505 1793 Kingswood Drive, Suite 200
Chattanooga, TN 37402 Southlake, Texas 76092
Custodian Distributor
Star Bank, N.A. AmeriPrime Financial Securities, Inc.
425 Walnut Street, M.L. 6118 1793 Kingswood Drive, Suite 200
Cincinnati, Ohio 45202 Southlake, Texas 76092
Transfer Agent (all purchases and Independent Auditors
all redemption requests) McCurdy & Associates CPA's, Inc.
Unified Fund Services, Inc. 27955 Clemens Road
431 North Pennsylvania Street Westlake, Ohio 44145
Indianapolis, Indiana 46204
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>
THE JUMPER STRATEGIC ADVANTAGE FUND
STATEMENT OF ADDITIONAL INFORMATION
July 15, 1998
This Statement of Additional Information is not a prospectus. It should
be read in conjunction with the Prospectus of The Jumper Strategic Advantage
Fund dated July 15, 1998. A copy of the Prospectus can be obtained by writing
the Transfer Agent at 431 North Pennsylvania Street, Indianapolis, Indiana
46204, or by calling 1-888-879-5723.
ASA0309F-071498-2
<PAGE>
- 10 -
STATEMENT OF ADDITIONAL INFORMATION
TABLE OF CONTENTS
PAGE
DESCRIPTION OF THE TRUST...................................................... 1
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK CONSIDERATIONS........ 1
MARKET NEUTRAL INVESTMENT STRATEGIES......................................... 3
STRATEGIC TRANSACTIONS....................................................... 4
INVESTMENT LIMITATIONS........................................................ 7
THE INVESTMENT ADVISOR........................................................ 8
TRUSTEES AND OFFICERS......................................................... 9
PORTFOLIO TRANSACTIONS AND BROKERAGE......................................... 10
DETERMINATION OF SHARE PRICE................................................. 11
INVESTMENT PERFORMANCE...................................................... 12
CUSTODIAN.................................................................... 13
TRANSFER AGENT................................................................13
ACCOUNTANTS.................................................................. 13
DISTRIBUTOR.................................................................. 13
FINANCIAL STATEMENTS..........................................................13
<PAGE>
DESCRIPTION OF THE TRUST
The Jumper Strategic Advantage 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.
Upon sixty days prior written notice to shareholders, the Fund may make
redemption payments in whole or in part in securities or other property if the
Trustees determine that existing conditions make cash payments undesirable. For
other 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.
A. Illiquid Securities. The Fund will not invest more than 15% of
its net assets in illiquid securities. Securities may be
illiquid because they are unlisted, subject to legal
restrictions on resale or due to other factors which, in the
adviser's opinion, raise a question concerning the fund's
ability to liquidate the securities in a timely and orderly
way without substantial loss. Underlying funds and
over-the-counter options are frequently illiquid. Illiquid
securities may also present difficult valuation issues.
B. Pricing of Portfolio Securities. There is no active market for the
securities of underlying funds -------------------------------- which the Fund
invests in. Underlying funds typically value, and stand ready to redeem, their
securities based upon current net asset value, which they provide to
shareholders on a periodic basis. The Board of Trustees has approved procedures
whereby the Fund's investment in securities for which market quotations are not
readily available (including securities issued by underlying funds) may be
established in good faith at fair value on a daily basis. The procedures provide
that the fair value of securities issued by underlying funds is determined based
upon current estimates of net asset value provided to the Fund by the underlying
funds. While the Fund has adopted pricing procedures which address these pricing
issues, there can be no guarantee that such securities are accurately valued on
a daily basis when the Fund determines its net asset value per share.
C. Legal Investment Limitations on Investments in Underlying Securities.
Like all mutual funds publicly
- --------------------------------------------------------------------- sold in
the United States, the Fund is subject to investment limitations imposed by the
Investment Company Act of 1940 ("1940 Act"). Section 12(d)(1) of the 1940 Act
limits the Fund's ability to invest in other investment companies, including
underlying funds. In general, sub-section (A) prohibits the Fund from:(1)
purchasing more than 3% of the voting stock of an investment company:(2)
investing more than 5% of the Fund's total assets in an investment company; or
(3) investing more than 10% of the Fund's total assets in all investment
companies combined. Sub-section (F) provides an exception from the prohibitions
established in sub-section (A) if:(1) the Fund does not own more than 3% of the
outstanding stock of any investment company; (2) the Fund does not impose a
sales load of more than 1.5% (the Fund is only sold on a no-load basis); and (3)
the investment companies are not required to redeem more than 1% of their
outstanding shares within any 30 day period. This discussion provides only a
summary of section 12(d)(1) of the 1940 Act.
D. 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.
E. Reverse Repurchase Agreements. Reverse repurchase agreements involve
sales of portfolio securities by ----------------------------- the Fund to
member banks of the Federal Reserve System or recognized securities dealers,
concurrently with an agreement by the Fund to repurchase the same securities at
a later date at a fixed price, which is generally equal to the original sales
price plus interest. The Fund retains record ownership and the right to receive
interest and principal payments on the portfolio security involved. The Fund's
objective in such a transaction would be to obtain funds to pursue additional
investment opportunities whose yield would exceed the cost of the reverse
repurchase transaction. Generally, the use of reverse repurchase agreements
should reduce portfolio turnover and increase yield.
In connection with each reverse repurchase agreement, the Fund
will direct its Custodian to place cash or U.S. government
obligations in a separate account in an amount equal to the
repurchase price. In the event of bankruptcy or other default
by the purchaser, the Fund could experience both delays in
repurchasing the portfolio securities and losses.
F. Borrowing and Leveraging. The Fund may have to deal with
unpredictable cash flows as shareholders purchase and redeem
shares. Under adverse conditions, the Fund might have to sell
portfolio securities to raise cash to pay for redemptions at a
time when investment considerations would not favor such
sales. In addition, frequent purchases and sales of portfolio
securities tend to decrease the Funds' performance by
increasing transaction expenses.
The Fund may deal with unpredictable cash flows by borrowing
money. Through such borrowings the Fund may avoid selling
portfolio securities to raise cash to pay for redemptions at a
time when investment considerations would not favor such
sales. In addition, the Fund's performance may be improved due
to a decrease in the number of portfolio transactions. After
borrowing money, if subsequent shareholder purchases do not
provide sufficient cash to repay the borrowed monies, the Fund
will liquidate portfolio securities in an orderly manner to
repay the borrowed monies.
To the extent that a Fund borrows money prior to selling
securities, or if the Fund borrows money for the purpose of
purchasing additional portfolio securities, the Fund would be
leveraged such that the Fund's net assets may appreciate or
depreciate in value more than an unleveraged portfolio of
similar securities. Since substantially all of the Fund's
assets will fluctuate in value and whereas the interest
obligations on borrowings may be fixed, the net asset value
per share of the Fund will increase more when the Fund's
portfolio assets increase in value and decrease more when the
Fund's portfolio assets decrease in value than would otherwise
be the case. Moreover, interest costs on borrowings may
fluctuate with changing market rates of interest and may
partially offset or exceed the returns which the Funds earn on
portfolio securities. Under adverse conditions, the Funds
might be forced to sell portfolio securities to meet interest
or principal payments at a time when market conditions would
not be conducive to favorable selling prices for the
securities.
MARKET NEUTRAL INVESTMENT STRATEGIES
To implement market neutral investment strategies, managers attempt to
purchase a portfolio of undervalued securities and short sell a portfolio of
overvalued securities with similar investment characteristics. Factors
considered when balancing a market neutral portfolio include market sectors and
market capitalization of equity securities, and cashflow, credit quality, and
duration of fixed income securities. Market neutral strategies may involve
purchasing and selling call and put options on either an individual security or
an index. In some cases, futures and options on futures may be used to effect
the desired risk/reward ratio. Market neutral investing does not depend upon any
particular market direction or favorable general economic conditions and thus
may be profitable during all economic cycles, including periods of economic
uncertainty and declining financial markets.
STRATEGIC TRANSACTIONS
The Fund, or the underlying funds, may purchase and sell
exchange-listed and over-the-counter put and call options on securities, equity
and fixed-income indices and other financial instruments, and purchase and sell
financial futures contracts and options thereon (collectively, all the above are
called "Strategic Transactions"). The Fund may engage in Strategic Transactions
for hedging, risk management, portfolio management, or speculation, and it will
comply with applicable regulatory requirements when implementing these
strategies, techniques and instruments.
Strategic Transactions may be used to attempt (1) to protect against
possible changes in the market value of securities held in or to be purchased
for a Fund's portfolio resulting from securities markets or currency exchange
rate fluctuations, (2) to protect a Fund's unrealized gains in the value of its
portfolio securities, (3) to facilitate the sale of such securities for
investment purposes, (4) to manage the effective maturity or duration of a
Fund's portfolio, (5) to establish a position in the derivatives markets as a
temporary substitute for purchasing or selling particular securities, (6) or to
gain additional market exposure and/or leverage in an attempt to enhance
investment returns. The Fund's ability to successfully use these Strategic
Transactions will depend upon the Advisor's ability to predict pertinent market
movements, and cannot be assured. Engaging in Strategic Transactions will
increase transaction expenses and may result in a loss that exceeds the
principal invested in the transactions.
Strategic Transactions have risk associated with them including
possible default by the other party to the transaction, illiquidity and, to the
extent the Advisor's view as to certain market movements is incorrect, the risk
that the use of such Strategic Transactions could result in losses greater than
if they had not been used. Use of put and call options may result in losses to
the Fund. For example, selling call options may force the sale of portfolio
securities at inopportune times or for lower prices than current market values.
Selling call options may also limit the amount of appreciation a Fund can
realize on its investments or cause a Fund to hold a security it might otherwise
sell. The use of currency transactions can result in a Fund incurring losses as
a result of a number of factors including the imposition of exchange controls,
suspension of settlements, or the inability to deliver or receive a specified
currency. The use of options and futures transactions entails certain other
risks. In particular, the variable degree of correlation between price movements
of futures contracts and price movements in the related portfolio position of a
Fund creates the possibility that losses on the hedging instrument may be
greater than gains in the value of a Fund's position. In addition, futures and
option markets may not be liquid in all circumstances and certain
over-the-counter options may have no markets. As a result, in certain markets, a
Fund might not be able to close out a transaction, and substantial losses might
be incurred. However, the use of futures and options transactions for hedging
should tend to minimize the risk of loss due to a decline in the value of a
hedged position. At the same time they tend to limit any potential gain that
might result from an increase in value of such position. Finally, the daily
variation margin requirement for futures contracts would create a greater on
going potential financial risk than would purchases of options, where the
exposure is limited to the cost of the initial premium. Losses resulting from
the use of Strategic Transactions would reduce net asset value, and possibly
income, and such losses can be greater than if the Strategic Transactions had
not been used.
The Fund's activities involving Strategic Transactions may be limited
by the requirements of Subchapter M of the Internal Revenue Code for
qualification as a regulated investment company.
Put and Call Options. The Fund may purchase and sell (issue) both put
and call options. The Fund may also enter into transactions to close out its
investment in any put or call options. A put option gives the purchaser of the
option, upon payment of a premium, the right to sell, and the issuer of the
option the obligation to buy the underlying security, commodity, index, currency
or other instrument at the exercise price. For instance, the Fund's purchase of
a put option on a security might be designed to protect its holdings in the
underlying instrument (or, in some cases, a similar instrument) against a
substantial decline in the market value by giving the Fund the right to sell
such instrument at the option exercise price. A call option, upon payment of a
premium, gives the purchaser of the option the right to buy, and the issuer the
obligation to sell, the underling instrument at the exercise price. The Fund's
purchase of a call option on a security, financial future, index currency or
other instrument might be intended to protect the Fund against an increase in
the price of the underlying instrument that it intends to purchase in the future
by fixing the price at which it may purchase such instrument. An "American
style" put or call option may be exercised at any time during the option period
while a "European style" put or call option may be exercised only upon
expiration or during a fixed period prior thereto.
The Fund is authorized to purchase and sell both exchange listed
options and over-the-counter options ("OTC options"). Exchange listed options
are issued by a regulated intermediary such as the Options Clearing Corporation
("OCC"), which guarantees the performance of the obligations of the parties to
such options. OTC options are purchased from or sold to securities dealers,
financial institutions or other parties, ("Counterparty(ies)"), through direct
bilateral agreement with the Counterparty. In contrast to exchange listed
options, which generally have standardized terms and performance mechanics, all
the terms of an OTC option are set by negotiation of the parties. Unless the
parties provide for it, there is no central clearing or guaranty function in an
OTC option.
The Fund's ability to close out its position as a purchaser or seller
of a put or call option is dependent, in part, upon the liquidity of the market
for that particular option. Exchange listed options, because they are
standardized and not subject to Counterparty credit risk, are generally more
liquid than OTC options. There can be no guarantee that a Fund will be able to
close out an option position, whether in exchange listed options or OTC options,
when desired. An inability to close out its options positions may reduce the
Fund's anticipated profits or increase its losses.
If the Counterparty to an OTC option fails to make or take delivery of
the security, currency or other instrument underlying an OTC option it has
entered into with a Fund, or fails to make a cash settlement payment due in
accordance with the terms of that option, a Fund may lose any premium it paid
for the option as well as any anticipated benefit of the transaction.
Accordingly, the Advisor must assess the creditworthiness of each such
Counterparty or any guarantor or credit enhancement of the Counterparty's credit
to determine the likelihood that the terms of the OTC option will be satisfied.
The Fund will realize a loss equal to all or a part of the premium paid
for an option if the price of the underlying security, commodity, index,
currency or other instrument security decreases or does not increase by more
than the premium (in the case of a call option), or if the price of the
underlying security, commodity, index, currency or other instrument increases or
does not decrease by more than the premium (in the case of a put option). A Fund
will not purchase any option if, immediately thereafter, the aggregate market
value of all outstanding options purchased by the Fund would exceed 5% of the
Fund's total assets.
If the Fund sells (i.e., issues) a call option, the premium that it
receives may serve as a partial hedge, to the extent of the option premium,
against a decrease in the value of the underlying securities or instruments in
its portfolio, or may increase the Fund's income. If the Fund sells (i.e.,
issues) a put option, the premium that it receives may serve to reduce the cost
of purchasing the underlying security, to the extent of the option premium, or
may increase the Fund's capital gains. All options sold by the Fund must be
"covered" (i.e., the Fund must either be long (when selling a call option) or
short (when selling a put option), the securities or futures contract subject to
the calls or must meet the asset segregation requirements described below as
long as the option is outstanding. Even though a Fund will receive the option
premium to help protect it against loss or reduce its cost basis, an option sold
by the Fund exposes the Fund during the term of the option to possible loss.
When selling a call, the Fund is exposed to the loss of opportunity to realize
appreciation in the market price of the underlying security or instrument, and
the transaction may require the Fund to hold a security or instrument that it
might otherwise have sold. When selling a put, the Fund is exposed to the
possibility of being required to pay greater than current market value to
purchase the underlying security, and the transaction may require the Fund to
maintain a short position in a security or instrument it might otherwise not
have maintained.
Futures Contracts. The Fund may enter into financial futures contracts
or purchase or sell put and call options on such futures as a hedge against
anticipated interest rate, currency or equity market changes, for duration
management and for risk management purposes. Futures are generally bought and
sold on the commodities exchange where they are listed with payment of an
initial variation margin as described below. The sale of a futures contract
creates a firm obligation by a Fund, as seller, to deliver to the buyer the
specific type of financial instrument called for in the contract at a specific
future time for a specified price (or, with respect to index futures and
Eurodollar instruments, the net cash amount). Options on futures contracts are
similar to options on securities except that an option on a futures contract
gives the purchaser the right in return for the premium paid to assume a
position in a futures contract and obligates the seller to deliver such
position.
The Fund's use of financial futures and options thereon will in all
cases be consistent with applicable regulatory requirements and in particular
the rules and regulations of the CFTC and will be entered into only for bona
fide hedging, risk management (including duration management) or other portfolio
management purposes. Typically, maintaining a futures contract or selling an
option thereon requires a Fund to deposit with a financial intermediary as
security for its obligations an amount of cash or other specified assets
(initial margin) that initially is typically 1% to 10% of the face amount of the
contract (but may be higher in some circumstances). Additional cash or assets
(variation margin) may be required to be deposited thereafter on a daily basis
as the marked-to-market value of the contract fluctuates. The purchase of an
option on financial futures involves payment of a premium for the option without
any further obligation on the part of the purchaser. If a Fund exercises an
option on a futures contract, it will be obligated to post initial margin (and
potentially subsequent variation margin) for the resulting futures position just
as it would for any futures position. Futures contracts and options thereon are
generally settled by entering into an offsetting transaction, but there can be
no assurance that the position can be offset, before settlement, at an
advantageous price, nor that delivery will occur.
The Fund will not enter into a futures contract or related option
(except for closing transactions) if, immediately afterwards, the sum of the
amount of its initial margin and premiums on open futures contracts and options
thereon would exceed 5% of the Fund's total assets (taken at current value).
However, in the case of an option that is in-the-money at the time of the
purchase, the in-the-money amount may be excluded in calculating the 5%
limitation. The segregation requirements with respect to futures contracts and
options thereon are described below.
Use of Segregated and Other Special Accounts. Many Strategic
Transactions, in addition to other requirements, require that the Fund segregate
liquid high grade assets with its custodian to the extent that the Fund's
obligations are not otherwise "covered" through ownership of the underlying
security, financial instrument or currency. The Fund may place up to 100% of its
assets in segregated accounts. In general, either the full amount of any
obligation of the Fund to pay or deliver securities or assets must be covered at
all times by the securities, instruments or currency required to be delivered,
or subject to any regulatory restrictions, an amount of cash or liquid high
grade debt securities at least equal to the current amount of the obligation
must either be identified as being restricted in the Fund's accounting records
or physically segregated in a separate account at that Fund's custodian. The
segregated assets cannot be sold or transferred unless equivalent assets are
substituted in their place or it is no longer necessary to segregate them. For
the purpose of determining the adequacy of the liquid securities that have been
restricted, the securities will be valued at market or fair value. If the market
or fair value of such securities declines, additional cash or liquid securities
will be restricted on a daily basis so that the value of the restricted cash or
liquid securities, when added to the amount deposited with the broker as margin,
equals the amount of such commitments by the Fund.
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
this 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 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.
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.
THE INVESTMENT ADVISOR
The Fund's investment advisor is The Jumper Group, Inc. Jay C. Jumper may
be deemed to be a controlling person of the Advisor due to his ownership of the
shares of the corporation.
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 0.75%. 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 "Jumper" 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 "Jumper"
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 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>
<S> <C> <C>
'''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''
Name, Age and Address Position Principal Occupations During
Past 5 Years
- -----------------------------------------------------------------------------------------------------------------------------------
* 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.
- -----------------------------------------------------------------------------------------------------------------------------------
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>
1 Trustee fees are Trust expenses and each series of the Trust pays a portion of
the Trustee fees. The compensation is estimated for the first full year of the
Trust ending October 31, 1998.
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 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.
In addition to providing average annual total return, the Fund may also
provide non-standardized quotations of total return for differing periods and
may provide 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 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 cash equivalent market in general. For
example, the Fund may use the Donahue Money Market Index, 90 day treasury bills,
or other money market index published by an independent third party.
In addition, the performance of the Fund may be compared to other
groups of 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, safekeeping 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
Unified Fund Services, Inc., 431 North Pennsylvania Street,
Indianapolis, Indiana 46204, 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 shareholder service functions. In addition, Unified
Fund Services, Inc. provides the Fund with certain monthly reports,
record-keeping and other management-related services. Fund accounting is
provided by American Data Services, Inc., Hauppauge Corporate Center, 150 Motor
Parkway, Hauppauge, New York 11760.
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 basis only against purchase orders for the shares. Shares of the Fund
are offered to the public on a continuous basis.
FINANCIAL STATEMENTS
The Fund was established as a separate series of the trust on February
16, 1998, and does not yet have an operating history. The Fund will send
shareholders annual and semi-annual reports as they become available.