SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / /
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Pre-Effective Amendment No. / /
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Post-Effective Amendment No. 30 /X/
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and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / /
Amendment No. 31 /X /
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(Check appropriate box or boxes.)
AmeriPrime Funds - File Nos. 33-96826 and 811-9096
1793 Kingswood Drive, Suite 200, Southlake, Texas 76092
(Address of Principal Executive Offices) Zip Code
Registrant's Telephone Number, including Area Code: (817) 431-2197
Kenneth Trumpfheller, 1793 Kingswood Dr., Suite 200, Southlake, TX 76092
(Name and Address of Agent for Service)
With copy to:
Donald S. Mendelsohn, Brown, Cummins & Brown Co., L.P.A.
3500 Carew Tower, Cincinnati, Ohio 45202
Approximate Date of Proposed Public Offering:
It is proposed that this filing will become effective:
/ / immediately upon filing pursuant to paragraph (b)
/ / on February 13, 1999 pursuant to paragraph (b)
/X/ 60 days after filing pursuant to paragraph (a)(1)
/ / on (date) pursuant to paragraph (a)(1)
/ / 75 days after filing pursuant to paragraph (a)(2)
/ / on (date) pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
DOBSON COVERED CALL FUND
PROSPECTUS
DECEMBER 10, 1999
INVESTMENT OBJECTIVE:
Above average return consistent with
lower risk than the S&P 500 Index
1422 S. Van Ness Street
Santa Ana, California 92707
877-2-DOBSON (877-236-2766)
The Securities and Exchange Commission has not approved or disapproved these
securities or determined if this prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
<PAGE>
TABLE OF CONTENTS
PAGE
ABOUT THE FUND
COSTS OF INVESTING IN THE FUND
HOW TO BUY SHARES
HOW TO REDEEM SHARES
THE PRICE OF SHARES
DIVIDENDS, DISTRIBUTIONS AND TAXES
MANAGEMENT OF THE FUND
YEAR 2000 ISSUE
FINANCIAL HIGHLIGHTS
<PAGE>
ABOUT THE FUND
INVESTMENT OBJECTIVE
The investment objective of the Dobson Covered Call Fund is to provide
above average return consistent with lower risk than the S&P 500 Index.
PRINCIPAL STRATEGIES
The Fund invests primarily in dividend paying common stocks of U.S.
issuers represented in the S&P 500 Index, maintaining industry weightings
similar to those of the Index. The principal strategy of the Fund's adviser is
to create a broadly diversified portfolio of common stock, and to reduce the
volatility of the Fund's portfolio by selling covered call options. The Fund's
option strategy is commonly referred to as "hedging."
When the Fund sells a covered call option, the purchaser of the option
has the right to buy that stock at a predetermined price (exercise price) during
the life of the option. If the purchaser exercises the option, the Fund must
sell the stock to the purchaser at the exercise price. The option is "covered"
because the Fund owns the stock at the time it sells the option. As the seller
of the option, the Fund receives a premium from the purchaser of the call
option, which provides additional income to the Fund.
In some periods the Fund will receive less total return and in other
periods greater total return than it would have received from its underlying
securities unoptioned. The Fund expects to increase its long term total return
by writing options which in its opinion have sufficiently large premiums to
produce greater total return over the long term. In general, the premiums
received from writing call options on a broadly diversified portfolio will
provide above average total return in a modestly rising (rising 10% a year or
less), flat or down market as measured by the S&P 500. In a rapidly rising
market, a covered call strategy on a broadly diversified portfolio will
underperform the market as measured by the S&P 500.
To the extent the Fund receives premiums from expired options and
profits from closing purchase transactions, any return from dividends and
appreciation will be enhanced. The selling of covered call options tends to
reduce volatility because:
o the premium received from selling the option will reduce any loss on
the underlying security by the amount of the premium, and
o the gain will be limited to the difference between the exercise price and
the price of the underlying security plus the premium received.
The Fund has no maximum or minimum level that will be hedged, but
anticipates being fully hedged with the exception of the utility industry, for
which option premiums have historically been low. Under normal circumstances, at
least 65% of the Fund's portfolio will be hedged using covered call options.
PRINCIPAL RISKS OF INVESTING IN THE FUND
o COMPANY RISK. The value of the Fund may decrease in response to the
activities and financial prospects of an individual company in the Fund's
portfolio.
o MARKET RISK. Overall stock market risks may also affect the value of the
Fund. Factors such as domestic economic growth and market conditions,
interest rate levels, and political events affect the securities markets.
o VOLATILITY RISK. Common stocks tend to be more volatile than other
investment choices. The value of an individual company can be more volatile
than the market as a whole. This volatility affects the value of the Fund's
shares. The Fund's option strategy cannot fully protect it against declines
in the value of its portfolio.
o OPTION WRITING RISK. When the Fund sells call options, it receives cash but
limits its opportunity to profit from an increase in the market value of
the stock beyond the exercise price (plus the premium received). The gain
may be less than if the Fund had not sold an option on the underlying
security. If a call expires unexercised, the Fund realizes a gain in the
amount of the premium received, although there may have been a decline
(unrealized loss) in the market value of the underlying securities during
the option period which may exceed such gain. If the underlying securities
should decline by more than the option premium the Fund received, there
will be a loss on the overall position.
o The Fund is not a complete investment program.
o As with any mutual fund investment, the Fund's returns will vary and you
could lose money.
ADDITIONAL INFORMATION ABOUT THE FUND
o The investment objective of the Fund may be changed without shareholder
approval.
o From time to time, the Fund may take temporary defensive positions that are
inconsistent with the Fund's principal investment strategies in attempting
to respond to adverse market, economic, political, or other conditions. For
example, the Fund may hold all or a portion of its assets in money market
instruments, securities of other no-load mutual funds or repurchase
agreements. If the Fund invests in shares of another mutual fund, the
shareholders of the Fund will indirectly pay additional management fees. As
a result of engaging in these temporary measures, the Fund may not achieve
its investment objective. The Fund may also invest in such instruments at
any time to maintain liquidity or pending selection of investments in
accordance with its policies.
IS THE FUND RIGHT FOR YOU?
The Fund may be suitable for:
o Long term investors seeking the potentially higher returns of common stocks
who want to reduce their risk.
o Investors willing to accept some price fluctuations in their investment,
but are looking for an investment with less volatility than the S&P 500
Index.
HOW THE FUND HAS PERFORMED
Although past performance of a fund is no guarantee of how it will
perform in the future, historical performance may give you some indication of
the risk of investing in the fund because it demonstrates how its returns have
varied over time. The Bar Chart and Performance Table that would otherwise
appear in this prospectus have been omitted because the Fund is recently
organized and has a limited performance history.
<PAGE>
COSTS OF INVESTING IN THE FUND
The tables describe the fees and expenses that you may pay if you buy and hold
shares of the Fund.
SHAREHOLDER FEES (fees paid directly from your investment) NONE
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund assets)
Management Fees............................................................0.00%
Distribution (12b-1) Fees..................................................0.00%
Other Expenses.............................................................1.50%
Total Annual Fund Operating Expenses.......................................1.50%
Example:
This Example is intended to help you compare the cost of investing in the
Fundwith the cost of investing in other mutual funds.
The Example assumes that you invest $10,000 in the Fund for the time periods
indicated, reinvest dividends and distributions, and then redeem all of your
shares at the end of those periods. The Example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ -------- ------- --------
$154 $477 $824 $1,801
HOW TO BUY SHARES
The minimum initial investment in the Fund is $2,500 and there is no
minimum on subsequent investments. There is no minimum on initial or subsequent
investments by tax deferred retirement plans (including IRA, SEP-IRA, Profit
Sharing, and Money Purchase Plans) or uniform gifts to minor accounts. These
minimums may be waived by the advisor for accounts participating in an automatic
investment program. If your investment is aggregated into an omnibus account
established by an investment advisor, broker or other intermediary, the account
minimums apply to the omnibus account, not to your individual investment. If you
purchase or redeem shares through a broker/dealer or another intermediary, you
may be charged a fee by that intermediary.
INITIAL PURCHASE
BY MAIL- You may make a direct initial investment by following these steps: o
complete and sign the investment application form which accompanies this
Prospectus; o write a check (subject to the minimum amounts) made payable to the
Fund; o mail the application and check to:
U.S. Mail: Overnight:
Dobson Covered Call Fund Dobson Covered Call Fund
c/o Unified Fund Services, Inc. c/o Unified Fund Services, Inc.
P.O. Box 6110 431 North Pennsylvania Street
Indianapolis, Indiana 46206-6110 Indianapolis, Indiana 46204
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. To wire money,
you must call Unified Fund Services, Inc. the Fund's transfer agent at
877-2-DOBSON 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,
provide your bank with the following information for purposes of wiring your
investment:
UMB Bank, N.A.
ABA #101000695
Attn: Dobson Covered Call Fund
D.D.A.# 9870983672
Account Name _________________(write in shareholder name)
For the Account # ______________(write in account number)
You must mail a signed application to UMB Bank, N.A, the Fund's
custodian, at the above address in order to complete your initial wire purchase.
Wire orders will be accepted only on a day on which the Fund, custodian and
transfer agent are open for business. A wire purchase will not be considered
made until the wired money is received and the purchase is accepted by the Fund.
Any delays which may occur in wiring money, including delays which may occur in
processing by the banks, are not the responsibility of the Fund or the transfer
agent. There is presently no fee for the receipt of wired funds, but the Fund
may charge shareholders for this service in the future.
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) -a check made payable to Dobson Covered Call Fund
Checks should be sent to the Dobson Covered Call Fund at the address listed
above. A bank wire should be sent as outlined above.
AUTOMATIC INVESTMENT PLAN
You may make regular investments in the Fund with an Automatic
Investment Plan by completing the appropriate section of the account application
and attaching a voided personal check. Investments may be made monthly to allow
dollar-cost averaging by automatically deducting $100 or more from your bank
checking account. You may change the amount of your monthly purchase at any
time.
TAX SHELTERED RETIREMENT PLANS
Since the Fund is oriented to longer-term investors, the Fund may be an
appropriate investment for tax-sheltered retirement plans, including: individual
retirement plans (IRAs); simplified employee pensions (SEPs); SIMPLE Plans;
401(k) plans; qualified corporate pension and profit-sharing plans (for
employees); tax deferred investment plans (for employees of public school
systems and certain types of charitable organizations); and other qualified
retirement plans. You should contact the Fund's transfer agent for the procedure
to open an IRA or SEP plan, as well as more specific information regarding these
retirement plan options. Please consult with an attorney or tax advisor
regarding these plans. You must pay custodial fees for your IRA by redemption of
sufficient shares of the Fund from the IRA unless you pay the fees directly to
the IRA custodian. Call the Fund's transfer agent about the IRA custodial fees.
OTHER PURCHASE INFORMATION
You may exchange securities that you own for shares of the Fund,
provided the securities meet the Fund's investment criteria and the Fund's
advisor deems them to be a desirable investment for the Fund. Any exchange will
be a taxable event and you may incur certain transaction costs relating to the
exchange. You may contact the Fund's transfer agent at 877-2-DOBSON for more
information.
The Fund may limit the amount of purchases and to refuse to sell to any
person. 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.
DISTRIBUTION PLAN
The Fund has adopted a plan, pursuant to Rule 12b-1 under the
Investment Company Act of 1940, which permits the Fund to pay directly, or
reimburse the Fund's Advisor and Distributor, for certain distribution and
promotion expenses related to marketing its shares, in an amount not to exceed
0.25% of the average daily net assets of the Fund. Expenditures pursuant to the
Plan and related agreements may reduce current yield after expenses. Because
these fees are paid out of the Fund's assets on an on-going basis, over time
these fees will increase the cost of your investment and may cost you more than
paying other types of sales charges.
HOW TO REDEEM SHARES
You may receive redemption payments by check or federal wire transfer.
The proceeds 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
may charge for this service in the future. Any charges for wire redemptions will
be deducted from your Fund account by redemption of shares. If you redeem your
shares through a broker/dealer or other institution, you 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:
Dobson Covered Call Fund
c/o Unified Fund Services, Inc.
P.O. Box 6110
Indianapolis, IN 46204
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. The Fund may require 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 the Fund's transfer agent, 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 Fund's transfer agent at 877-2-DOBSON. 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 Fund or the transfer agent may terminate the telephone redemption
and exchange procedures at any time. 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 Fund's transfer agent at 877-2-DOBSON. 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 calendar 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 may require you to redeem all of your shares in the Fund on
30 days' written notice if the value of your shares in the Fund is less than
$2,500 due to redemption, or such other minimum amount as the Fund may determine
from time to time. An involuntary redemption constitutes a sale. You should
consult your tax advisor concerning the tax consequences of involuntary
redemptions. You may increase the value of your shares in the Fund to the
minimum amount within the 30-day period. Your shares are 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.
THE PRICE OF SHARES
The price you pay for your shares is based on the Fund's net asset
value per share (NAV). The NAV is calculated at the close of trading (normally
4:00 p.m. Eastern time) on each day the New York Stock Exchange is open for
business (the Stock Exchange is closed on weekends, Federal holidays and Good
Friday). The NAV is calculated by dividing the value of the Fund's total assets
(including interest and dividends accrued but not yet received) minus
liabilities (including accrued expenses) by the total number of shares
outstanding.
The Fund's assets are generally valued at their market value. If market
prices are not available, or if an event occurs after the close of the trading
market that materially affects the values, assets may be valued at their fair
value.
Requests to purchase and sell shares are processed at the NAV next
calculated after we receive your order in proper form.
<PAGE>
DIVIDENDS, DISTRIBUTIONS AND TAXES
DIVIDENDS AND DISTRIBUTIONS. The Fund typically distributes
substantially all of its net investment income in the form of dividends and
taxable capital gains to its shareholders on an annual basis. These
distributions are automatically reinvested in the Fund unless you request cash
distributions on your application or through a written request. The Fund expects
that its distributions will consist primarily of short term capital gains from
the sale of options.
TAXES. In general, selling shares of the Fund and receiving
distributions (whether reinvested or taken in cash) are taxable events.
Depending on the purchase price and the sale price, you may have a gain or a
loss on any shares sold. Any tax liabilities generated by your transactions or
by receiving distributions are your responsibility. Because distributions of
long term capital gains are subject to capital gains taxes, regardless of how
long you have owned your shares, you may want to avoid making a substantial
investment when a Fund is about to make a long term capital gains distribution.
If the Fund has to sell a security because of the exercise of a call
option, the Fund will realize a gain or loss from the sale of the underlying
security with the proceeds being increased by the amount of the option premium
received. By permitting its underlying securities to be called away or
exercised, higher portfolio turnover (and increased transaction costs) will
result. Portfolio turnover also results in capital gains for income tax
purposes. The Fund will attempt to minimize portfolio turnover by entering into
closing purchase transactions that it deems appropriate to achieve the Fund's
objectives.
Early each year, the Fund will mail to you a statement setting forth
the federal income tax information for all distributions made during the
previous year. If you do not provide your taxpayer identification number, your
account will be subject to backup withholding.
The tax considerations described in this section do not apply to
tax-deferred accounts or other non-taxable entities. Because each investor's tax
circumstances are unique, please consult with your tax advisor about your
investment.
MANAGEMENT OF THE FUND
Dobson Capital Management, Inc., 1422 S. Van Ness Street, Santa Ana,
California serves as investment advisor to the Fund. The advisor determines the
securities to be held or sold by the Fund, and the portion of the Fund's assets
to be held uninvested. Dobson Capital Management, Inc., is a California
corporation established in 1998.
Charles L. Dobson is the President, Director and sole shareholder of
the advisor, and is primarily responsible for the day-to-day management of the
Fund's portfolio. Mr. Dobson was associated with Analytic/TSA Global Asset
Management for nearly twenty years, acting as Executive Vice President and
Portfolio Manager of the Analytic Optioned Equity Fund from March 1992 until May
1998, and Executive Vice President and Secretary of the Analytic Series Fund
from November 1992 until May 1998. Mr. Dobson graduated from the University of
California at Irvine where he received a BA in Economics and an MS in
Administration.
During the fiscal period ended July 31, 1999, the advisor received no
compensation from the Fund.
<PAGE>
YEAR 2000 ISSUE
Like other mutual funds, financial and business organizations and
individuals around the world, the Fund could be adversely affected if the
computer systems used by the Fund's advisor or the Fund's various service
providers do not properly process and calculate date-related information and
data from and after January 1, 2000. This is commonly known as the "Year 2000
Issue."
The Fund's advisor has taken steps that it believes are reasonably
designed to address the Year 2000 Issue with respect to computer systems that
are used and to obtain reasonable assurances that comparable steps are being
taken by the Funds' major service providers. At this time, however, there can be
no assurance that these steps will be sufficient to avoid any adverse impact on
the Fund. In addition, the Fund's advisor cannot make any assurances that the
Year 2000 Issue will not affect the companies in which the Fund invests or
worldwide markets and economies.
FINANCIAL HIGHLIGHTS
The following table is intended to help you better understand the
Fund's financial performance since its inception. Certain information reflects
financial results for a single Fund share. The total returns represent the rate
you would have earned (or lost) on an investment in the Fund, assuming
reinvestment of all dividends and distributions. This information has been
audited by McCurdy & Associates CPA's, Inc., whose report, along with the Fund's
financial statements, are included in the Fund's annual report, which is
available upon request.
FOR THE PERIOD MARCH 24, 1999 (COMMENCEMENT OF OPERATIONS) TO JULY 31, 1999
SELECTED PER SHARE DATA
Net asset value, beginning of period $ 10.00
------------------
Income from investment operations
Net investment income 00.01
Net realized and unrealized gain 00.77
Total from investment operations 00.78
Net asset value, end of period $ 10.78
==================
TOTAL RETURN (b) 7.80%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000) $1,375
Ratio of expenses to average net assets 1.50% (a)
Ratio of expenses to average net assets
before reimbursement 9.77% (a)
Ratio of net investment income to
average net assets 0.32% (a)
Ratio of net investment income to
average net assets before reimbursement (7.95)% (a)
Portfolio turnover rate 47.01% (a)
(a) Annualized.
(b) For periods of less than a full year, total returns are not annualized.
<PAGE>
[BACK COVER PAGE]
Several additional sources of information are available to you. The
Statement of Additional Information (SAI), incorporated into this prospectus by
reference, contains detailed information on Fund policies and operations.
Shareholder reports contain management's discussion of market conditions,
investment strategies and performance results as of the Fund's latest
semi-annual or annual fiscal year end.
Call the Fund at (877)-687-7859 to request free copies of the SAI and
the Fund's annual and semi-annual reports, to request other information about
the Fund and to make shareholder inquiries.
You may also obtain information about the Fund (including the SAI and
other reports) from the Securities and Exchange Commission on their Internet
site at http://www.sec.gov or at their Public Reference Room in Washington, D.C.
Call the SEC at 800-SEC-0330 for room hours and operation. You may also obtain
fund information by sending a written request and duplicating fee to the Public
Reference Section of the SEC, Washington, D.C. 20549-6609.
Investment Company Act #811-9096
<PAGE>
DOBSON COVERED CALL FUND
STATEMENT OF ADDITIONAL INFORMATION
December 10, 1999
This Statement of Additional Information ("SAI") is not a prospectus.
It should be read in conjunction with the Prospectus of Dobson Covered Call Fund
dated December 10, 1999. This SAI incorporates by reference the Trust's Annual
Report to Shareholders for the fiscal year ended July 31, 1999 ("Annual
Report"). A free copy of the Prospectus or Annual Report can be obtained by
writing the Transfer Agent at 431 North Pennsylvania Street, Indianapolis,
Indiana 46204, or by calling 1-877-236-2766.
PAGE
DESCRIPTION OF THE TRUST AND THE FUND..........................................1
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK
CONSIDERATIONS.................................................................1
INVESTMENT LIMITATIONS.........................................................5
THE INVESTMENT ADVISOR.........................................................8
DISTRIBUTION PLAN..............................................................8
TRUSTEES AND OFFICERS..........................................................8
PORTFOLIO TRANSACTIONS AND BROKERAGE...........................................9
DETERMINATION OF SHARE PRICE..................................................10
INVESTMENT PERFORMANCE........................................................11
CUSTODIAN.....................................................................12
TRANSFER AGENT................................................................12
ACCOUNTANTS...................................................................12
DISTRIBUTOR...................................................................12
ADMINISTRATOR.................................................................12
- 1 -
6708
<PAGE>
- 2 -
KL2:321107.1
DESCRIPTION OF THE TRUST AND FUND
The Dobson Covered Call Fund (the "Fund") was organized as a
diversified 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 and was organized on March
22, 1999. It commenced operations on March 24, 1999.
The Fund does not issue share certificates. All shares are held in
non-certificate form registered on the books of the Fund and the Transfer Agent
for the account of the shareholder. 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.
As of ____, 1999 the following persons may be deemed to have
beneficially owned five percent (5%) or more of the Fund: [--------].
[As of ___, 1999, the Officers and Trustees as a group beneficially
owned less than one percent (1%) of the Fund.]
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. The
Declaration of Trust can be amended by the Trustees, except that any amendment
that adversely effects the rights of shareholders must be approved by the
shareholders affected. 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 Fund's
shareholders.
For information concerning the purchase and redemption of shares of the
Fund, see "How to Buy Shares" 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 "The Price of Shares" in the Fund's
Prospectus.
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK CONSIDERATIONS
This section contains a more detailed discussion of some of the
investments the Fund may make and some of the techniques it may use, as
described in the Prospectus (see "Investment Objectives and Strategies" and
"Investment Policies and Techniques and Risk Considerations").
A. Equity Securities. Equity securities consist of common stock,
convertible preferred stock, rights and warrants. Common stocks, the most
familiar type, represent an equity (ownership) interest in a corporation.
Warrants are options to purchase equity securities at a specified price for a
specific time period. Rights are similar to warrants, but normally have a short
duration and are distributed by the issuer to its shareholders. Although equity
securities have a history of long-term growth in value, their prices fluctuate
based on changes in a company's financial condition and on overall market and
economic conditions.
Investments in equity securities are subject to inherent market risks
and fluctuations in value due to earnings, economic conditions and other factors
beyond the control of the Advisor. As a result, the return and net asset value
of a Fund will fluctuate. Securities in a Fund's portfolio may not increase as
much as the market as a whole and some undervalued securities may continue to be
undervalued for long periods of time. Although profits in some Fund holdings may
be realized quickly, it is not expected that most investments will appreciate
rapidly.
B. Options Transactions. The Fund may write (sell) covered call
options. A covered call option on a security is an agreement to sell a
particular portfolio security if the option is exercised at a specified price,
or before a set date. The Fund may also sell exchange listed stock index call
options to hedge against risks of market wide price movements. Options are sold
(written) on securities and market indices. The purchaser of an option on a
security pays the seller (the writer) a premium for the right granted but is not
obligated to buy or sell the underlying security. The purchaser of an option on
a market index pays the seller a premium for the right granted, and in return
the seller of such an option is obligated to make the payment. A writer of an
option may terminate the obligation prior to the expiration of the option by
making an offsetting purchase of an identical option. Options on securities
which the Fund sells (writes) will be covered or secured, which means that it
will own the underlying security (for a call option) or (for an option on a
stock index) will hold a portfolio of securities substantially replicating the
movement of the index (or, to the extent it does not hold such a portfolio, will
maintain a segregated account with the Custodian of high quality liquid debt
obligations equal to the market value of the option, marked to market daily).
When the Fund writes options, it may be required to maintain a margin account,
to pledge the underlying security or to deposit liquid high quality debt
obligations in a separate account with the Custodian. When a Fund writes an
option, the Fund profits from the sale of the option, but gives up the
opportunity to profit from any increase in the price of the stock above the
option price, and may incur a loss if the stock price falls. Risks associated
with writing covered call options include the possible inability to effect
closing transactions at favorable prices and an appreciation limit on the
securities set aside for settlement. When the Fund writes a covered call option,
it will receive a premium, but will assume the risk of loss should the price of
the underlying security fall below the exercise price.
A call option gives the purchaser of the option the right to buy, and
the writer of the option has the obligation to sell, the underlying securities
at the exercise price during the option period. The Fund, as the writer of the
option, receives a premium from the purchaser of the call option. During the
time the Fund is obligated under the option, the Fund may be assigned an
exercise notice by the broker-dealer through whom the call was sold, requiring
the Fund to deliver the underlying security against payment of the exercise
price. The obligation is terminated only upon expiration of the option or at
such earlier time as the Fund purchases the option back (closing purchase
transaction). Once the Fund has been assigned an exercise notice, it will be
unable to enter into a closing purchase transaction. So long as the Fund is
obligated as the writer of a call option, it will own the underlying securities
subject to the option.
To secure this obligation to deliver the underlying security, the Fund
is required to deposit in escrow the underlying securities or other assets in
accordance with the rules of the Clearing Corporation and the exchange on which
the call option is traded. To fulfill this obligation at the time an option is
written, the Fund, in compliance with its custodian agreement, directs the
Custodian of its investment securities, or a securities depository acting for
the Custodian, to act as the Fund's escrow agent by issuing an escrow receipt to
the Clearing Corporation respecting the option's underlying securities. The
Clearing Corporation will release the securities from this escrow either upon
the exercise of the option, the expiration of the option without being exercised
or when the Fund enters into a closing purchase transaction. Until such release
the Fund cannot sell the underlying securities.
The Fund will write options on such portion of its portfolio as
management determines is appropriate in seeking to attain the Fund's objective.
The Fund will write options when management believes that a liquid secondary
market will exist on a national securities exchange for options of the same
series so that the Fund can effect a closing purchase transaction if it desires
to close out its position. Consistent with the investment policies of the Fund,
a closing purchase transaction will ordinarily be effected to realize a profit
on an outstanding option, to prevent an underlying security from being called,
or to permit the sale of the underlying security. Effecting a closing purchase
transaction will permit the Fund to write another option on the underlying
security with either a different exercise price or expiration date or both.
The premium the Fund receives for writing an option will reflect, among
other things, the current market price of the underlying security, the
relationship of the exercise price to such market price, the historical price
volatility of the underlying security, the option period, supply and demand and
interest rates. The exercise price of an option may be below, equal to or above
the current market value of the underlying security at the time the option is
written. Options written by the Fund will normally have expiration dates between
one and nine months from the date written. From time to time, for tax and other
reasons, the Fund may purchase an underlying security for delivery in accordance
with an exercise notice assigned to it, rather than delivering such security
from its portfolio.
C. Stock Index Options. The Fund may sell exchange listed stock index
call options to hedge against risks of market wide price movements. The need to
hedge against such risks will depend on the extent of diversification of the
Fund's common stock and the sensitivity of its stock investments to factors
influencing the stock market as a whole. A stock index fluctuates with changes
in the market values of the securities included in the index. Options on
securities indices are generally similar to options on stocks except that the
delivery requirements are different. Instead of giving the right to take or make
delivery of securities at a specified price, an option on a stock index gives
the holders the right to receive a cash "exercise settlement amount" equal to
(a) the amount, if any, by which the fixed exercise price of the option exceeds
(in the case of a put) or is less than (in the case of a call) the closing value
of the underlying index on the date of the exercise, multiplied by (b) a fixed
"index multiplier." To cover the potential obligations involved in writing stock
index options, the Fund will either (a) hold a portfolio of stocks substantially
replicating the movement of the index, or (b) the Fund will segregate with the
Custodian high grade liquid debt obligations equal to the market value of the
stock index option, marked to market daily. The Fund will only write stock index
options when in its opinion the underlying stocks will correlate with the index.
The Fund's ability to hedge effectively all or a portion of its securities
through transactions in stock index options depends on the degree to which
price movements in the underlying securities correlate with price movements in
the relevant index. Inasmuch as
such securities will not duplicate the components of any index, the
correlation will not be perfect. Consequently, the Fund bears the risk
that the prices of the underlying securities being hedged will not move
in the same amount as the stock index.
D. Repurchase Agreements. The Fund may invest in repurchase agreements
fully collateralized by U.S. Government or agency obligations. A repurchase
agreement is a short-term investment in which the purchaser (i.e., the Fund)
acquires ownership of a U.S. Government or agency 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 UMB Bank, N.A. (the Fund's 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.
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.
Non-Fundamental. The following limitations have been adopted by the
Trust with respect to the Fund and are Non-Fundamental (see "Investment
Restrictions" above).
1. Pledging. The Fund will not mortgage, pledge, hypothecate or in any
manner transfer, as security for indebtedness, any assets of the Fund except as
may be necessary in connection with borrowings described in limitation (1)
above. Margin deposits, security interests, liens and collateral arrangements
with respect to transactions involving options, futures contracts, short sales
and other permitted investments and techniques are not deemed to be a mortgage,
pledge or hypothecation of assets for purposes of this limitation.
2. Borrowing. The Fund will not engage in borrowing.
3. Margin Purchases. The Fund will not purchase securities or evidences
of interest thereon on "margin." This limitation is not applicable to short term
credit obtained by the Fund for the clearance of purchases and sales or
redemption of securities, or to arrangements with respect to transactions
involving options, futures contracts, short sales and other permitted
investments and techniques.
4. Short Sales. The Fund will not effect short sales of securities.
5. Options. The Fund will not purchase or sell puts, calls, options or
straddles except as described in the Prospectus or Statement of Additional
Information.
6. Illiquid Investments. The Fund will not invest in securities for
which there are legal or contractual restrictions on resale and other illiquid
securities.
7. Loans of Portfolio Securities. The Fund will not make loans of
portfolio securities.
THE INVESTMENT ADVISOR
The Fund's investment advisor is Dobson Capital Management, Inc. (the
"Advisor"), 1422 S. Van Ness Street, Santa Ana, California 92707. As sole
shareholder of the Advisor, Charles L. Dobson may be deemed to be a controlling
person of the Advisor.
Under the terms of the management agreement (the "Agreement"), the
Advisor manages the Fund's investments subject to approval of the Board of
Trustees. As compensation for its management services, the Fund is obligated to
pay the Advisor a fee computed and accrued daily and paid monthly at an annual
rate of 0.80% of the average daily net assets of the Fund, less the amount total
operating expenses, including the management fee, exceed 1.50%. For the period
ended July 31, 1999, the Advisor received no compensation from the Fund.
The Advisor retains the right to use the name "Dobson" 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 "Dobson"
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.
DISTRIBUTION PLAN
The Fund has adopted a Distribution Plan pursuant to Rule 12b-1 under
the 1940 Act (the "Plan"). The Plan permits the Fund to pay directly, or
reimburse the Advisor and Distributor, for distribution expenses in amount not
to exceed 0.25% of the average daily net assets of the Fund. Under the Plan, the
Trust may engage in any activities related to the distribution of Fund shares,
including without limitation the following: (a) payments, including incentive
compensation, to securities dealers or other financial intermediaries, financial
institutions, investment advisors and others that are engaged in the sale of
shares, or that may be advising shareholders of the Trust regarding the
purchase, sale or retention of shares, or that hold shares for shareholders in
omnibus accounts or as shareholders of record or provide shareholder support or
administrative services to the Fund and its shareholders; (b) expenses of
maintaining personnel who engage in or support distribution of shares or who
render shareholder support services, including, allocated overhead, office space
and equipment, telephone facilities and expenses, answering routine inquiries
regarding the Trust, processing shareholder transactions, and providing such
other shareholder services as the Trust may reasonably request; (c) costs of
preparing, printing and distributing prospectuses and statements of additional
information and reports of the Fund for recipients other than existing
shareholders of the Fund; (d) costs of formulating and implementing marketing
and promotional activities, including, sales seminars, direct mail promotions
and television, radio, newspaper, magazine and other mass media advertising; (e)
costs of preparing, printing and distributing sales literature; (f) costs of
obtaining such information, analyses and reports with respect to marketing and
promotional activities as the Trust may deem advisable; and (g) costs of
implementing and operating the Plan.
The Trustees expect that the Plan will significantly enhance the Fund's
ability to distribute its shares. The Plan has been approved by the Fund's Board
of Trustees, including a majority of the Trustees who are not "interested
persons" of the Fund and who have no direct or indirect financial interest in
the Plan or any related agreement, by a vote cast in person. Continuation of the
Plan and the related agreements must be approved by the Trustees annually, in
the same manner, and the Plan or any related agreement may be terminated at any
time without penalty by a majority of such independent Trustees or by a majority
of the outstanding shares of the Fund. Any amendment increasing the maximum
percentage payable under the Plan must be approved by a majority of the
outstanding shares of the Fund, and all other material amendments to the Plan or
any related agreement must be approved by a majority of the independent
Trustees. As an executive officer of the Fund's Distributor, Kenneth
Trumpfheller, a Trustee of the Trust, may benefit indirectly from payments
received by the Fund's Distributor.
TRUSTEES AND OFFICERS
The Board of Trustees supervises the business activities of the Trust.
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>
<S> <C> <C>
==================================== ---------------- ======================================================================
NAME, AGE AND ADDRESS POSITION PRINCIPAL OCCUPATIONS DURING PAST 5 YEARS
==================================== ---------------- ======================================================================
*Kenneth D. Trumpfheller President and President, Treasurer and Secretary of AmeriPrime Financial Services,
Age: 41 Trustee Inc., the Fund's administrator, and AmeriPrime Financial Securities,
1793 Kingswood Drive Inc., the Fund's distributor, since 1994. President and Trustee of
Suite 200 Ameriprime Advisors Trust and AmeriPrime Insurance Trust. Prior to
Southlake, Texas 76092 December, 1994, a senior client executive with SEI Financial
Services.
==================================== ---------------- ======================================================================
Paul S. Bellany Secretary, Secretary, Treasurer and Chief Financial Officer of AmeriPrime
Age: 40 Treasurer Financial Services, Inc. and AmeriPrime Financial Securities, Inc.;
1793 Kingswood Drive various positions with Fidelity Investments from 1987 to 1998; most
Suite 200 recently Fund Reporting Unit Manager.
Southlake, Texas 76092
==================================== ---------------- ======================================================================
Steve L. Cobb Trustee President of Chandler Engineering Company, L.L.C., oil and gas
Age: 42 services company; various positions with Carbo Ceramics, Inc., oil
2001 N. Indianwood Avenue field manufacturing/supply company, from 1984 to 1997, most recently
Broken Arrow, OK 74012 Vice President of Marketing.
==================================== ================ ======================================================================
Gary E. Hippenstiel Trustee Director, Vice President and Chief Investment Officer of Legacy
Age: 52 Trust Company since 1992; President and Director of Heritage Trust
600 Jefferson Street Company from 1994-1996; Vice President and Manager of Investments of
Suite 350 Kanaly Trust Company from 1988 to 1992.
Houston, TX 77063
==================================== ================ ======================================================================
</TABLE>
The compensation paid to the Trustees of the Trust for the Fund's
fiscal year ended July 31, 1999 is set forth in the following table. Trustee
fees are Trust expenses and each series of the Trust pays a portion of the
Trustee fees.
<TABLE>
<S> <C> <C>
====================================== -------------------------- =======================================
NAME AGGREGATE TOTAL COMPENSATION
COMPENSATION FROM TRUST (THE TRUST IS
FROM TRUST NOT IN A FUND COMPLEX)
====================================== -------------------------- =======================================
Kenneth D. Trumpfheller 0 0
====================================== -------------------------- =======================================
Steve L. Cobb $_____ $_____
====================================== ========================== =======================================
Gary E. Hippenstiel $_____ $_____
====================================== ========================== =======================================
</TABLE>
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. 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 Trust as a factor in
the selection of brokers and dealers to execute portfolio transactions.
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.
When the Fund and another of the Advisor's clients seek to purchase or
sell the same security at or about the same time, the Advisor may execute the
transaction on a combined ("blocked") basis. Blocked transactions can produce
better execution for the Fund because of the increased volume of the
transaction. If the entire blocked order is not filled, the Fund 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 Fund 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. In the event that the entire blocked order
is not filled, the purchase or sale will normally be allocated on a pro rata
basis. The allocation may be adjusted by the Advisor, taking into account such
factors as the size of the individual orders and transaction costs, when the
Advisor believes adjustment is reasonable.
For the period ended ____, 1999, the Fund paid brokerage commissions of
$___.
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.
INVESTMENT PERFORMANCE
The Fund may periodically advertise "average annual total return."
"Average annual total return," as defined by the Securities and Exchange
Commission, is computed by finding the average annual compounded rates of return
for the period indicated 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. For the period ended
___, 1999, the Fund's average annual total return was __%.
From time to time, in advertisements, sales literature and information
furnished to present or prospective shareholders, the performance of the Fund
may be compared to indices of broad groups of unmanaged securities considered to
be representative of or similar to the portfolio holdings of the Fund or
considered to be representative of the stock market in general. The Fund may use
the Standard & Poor's 500 Stock Index or the Dow Jones Industrial Average.
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
UMB Bank, N.A., 928 Grand Blvd., 10th floor, Kansas City, Missouri
64106, is Custodian of the Fund's investments. The Custodian acts as the Fund's
depository, safekeeps its portfolio securities, collects all income and other
payments with respect thereto, disburses funds at the Fund's request and
maintains records in connection with its duties.
TRANSFER AGENT
Unified Fund Services, Inc. ("Unified"), 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 accounting and shareholder service functions. In
addition, Unified provides the Fund with fund accounting services, which
includes certain monthly reports, record-keeping and other management-related
services. For its services as fund accountant, Unified receives an annual fee
from the Advisor equal to 0.0275% of the Fund's assets up to $100 million
(subject to various monthly minimum fees, the maximum being $2,000 per month for
assets of $20 to $100 million). For the period ended July 31, 1999, Unified
received $___ from the Advisor (not the Fund) for these services.
ACCOUNTANTS
The firm of McCurdy & Associates, CPA's, 27955 Clemens Road, Westlake,
Ohio 44145, has been selected as independent public accountants for the Fund for
the fiscal year ending July 31, 2000. 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. Kenneth D. Trumpfheller, a Trustee and Officer of the Trust, is an
affiliate of the Distributor. 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.
ADMINISTRATOR
The Fund retains AmeriPrime Financial Services, Inc., 1793 Kingswood
Drive, Suite 200, Southlake, TX 76092, (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. For the period ended July 31, 1999, the Administrator received $__
for these services.
FINANCIAL STATEMENTS
The financial statements and independent auditor's report required to
be included in the statement of additional information are hereby incorporated
by reference to the Fund's Annual Report to the shareholders for the period
ended July 31, 1999. The Trust will provide the Annual Report without charge by
calling the Fund at (877)-236-2766.
<PAGE>
AMERIPRIME FUNDS
PART C. OTHER INFORMATION
Item 23. Exhibits
(a) Articles of Incorporation.
(i) Copy of Registrant's Declaration of Trust, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 11, is hereby incorporated by
reference.
(ii) Copy of Amendment No. 1 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 11, is hereby
incorporated by reference.
(iii) Copy of Amendment No. 2 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 1, is hereby
incorporated by reference.
(iv) Copy of Amendment No. 3 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 4, is hereby
incorporated by reference.
(v) Copy of Amendment No. 4 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 4, is hereby
incorporated by reference.
(vi) Copy of Amendment No. 5 and Amendment No. 6 to Registrant's Declaration of
Trust, which were filed as an Exhibit to Registrant's Post-Effective Amendment
No. 8, are hereby incorporated by reference.
(viii) Copy of Amendment No. 7 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 11, is hereby
incorporated by reference.
(ix) Copy of Amendment No. 8 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 12, is hereby
incorporated by reference.
(x) Copy of Amendment No. 9 to Registrant's Declaration of Trust which was filed
as an Exhibit to Registrant's Post-Effective Amendment No. 15, is hereby
incorporated by reference.
(xi) Copy of Amendment No. 10 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 16, is hereby
incorporated by reference.
(xii) Copy of Amendment No. 11 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 17, is hereby
incorporated by reference.
(xiii) Copy of Amendment No. 12 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 23, is hereby
incorporated by reference.
(xiv) Copy of Amendment No. 13 to Registrant's Declaration of Trust, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 23, is hereby
incorporated by reference.
(xv) Copy of Amendments No. 14-17 to Registrant's Declaration of Trust, which
were filed as Exhibits to Registrant's Post-Effective Amendment No. 27, are
hereby incorporated by reference.
(xvi) Copy of Amendments No. 18-19 to Registrant's Declaration of Trust are
filed herewith.
(b) By-Laws. Copy of Registrant's By-Laws, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 11, is hereby incorporated by
reference.
(c) Instruments Defining Rights of Security Holders. - None other than in
the Declaration of Trust, as amended, and By-Laws of the Registrant.
(d) Investment Advisory Contracts.
(i) Copy of Registrant's Management Agreement with Carl Domino Associates, L.P.,
Adviser to Carl Domino Equity Income Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 11, is hereby incorporated by
reference.
(ii) Copy of Registrant's Management Agreement with Jenswold, King & Associates,
Adviser to Fountainhead Special Value Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 8, is hereby incorporated by
reference.
(iii) Copy of Registrant's Management Agreement with GLOBALT, Inc., Adviser to
GLOBALT Growth Fund, which was filed as an Exhibit to Registrant's
Post-Effective Amendment No. 11, is hereby incorporated by reference.
(iv) Copy of Registrant's Management Agreement with IMS Capital Management,
Inc., Adviser to the IMS Capital Value Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 2, is hereby incorporated by
reference.
(v) Copy of Registrant's Management Agreement with Commonwealth Advisors, Inc.,
Adviser to Florida Street Bond Fund and Florida Street Growth Fund, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 8, is hereby
incorporated by reference.
(vi) Copy of Registrant's Management Agreement with Corbin & Company, Adviser to
Corbin Small-Cap Fund, which was filed as an Exhibit to Registrant's
Post-Effective Amendment No. 8, is hereby incorporated by reference.
(vii) Copy of Registrant's proposed Management Agreement with Vuong Asset
Management Company, LLC, Adviser to MAI Enhanced Index Fund, MAI Growth & Income
Fund, MAI Aggressive Growth Fund, MAI High-Yield Income Fund, MAI Capital
Appreciation Fund and MAI Global Equity Fund (the "MAI Family of Funds"), which
was filed as an Exhibit to Registrant's Post-Effective Amendment No. 12, is
hereby incorporated by reference.
(viii) Copy of Registrant's proposed Management Agreement with CWH Associates,
Inc., Advisor to Worthington Theme Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 10, is hereby incorporated by
reference.
(ix) Copy of Registrant's Management Agreement with Burroughs & Hutchinson,
Inc., Advisor to the Marathon Value Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 15, is hereby incorporated by
reference.
(x) Copy of Registrant's Management Agreement with The Jumper Group, Inc.,
Adviser to the Jumper Strategic Advantage Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 23, is hereby incorporated by
reference.
(xi) Copy of Registrant's Management Agreement with Appalachian Asset
Management, Inc., Advisor to the AAM Equity Fund, which was filed as an Exhibit
to Registrant's Post-Effective Amendment No. 17, is hereby incorporated by
reference.
(xii) Copy of Registrant's Management Agreement with Martin Capital Advisors,
L.L.P., Advisor to the Austin Opportunity Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 23, is hereby incorporated by
reference.
(xiii) Copy of Registrant's proposed Management Agreement with Paul B. Martin,
Jr. d/b/a Martin Capital Advisors, Advisor to the Texas Opportunity Fund, which
was filed as an Exhibit to Registrant's Post-Effective Amendment No. 17, is
hereby incorporated by reference.
(xiv) Copy of Registrant's Management Agreement with Martin Capital Advisors
L.L.P., Advisor to the U.S. Opportunity Fund, which was filed as an Exhibit to
Registrants Post-Effective Amendment No. 29, is hereby incorporated by
reference.
(xv) Copy of Registrant's Management Agreement with Gamble, Jones, Morphy &
Bent, Advisor to the GJMB Growth Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 23, is hereby incorporated by
reference.
(xvi) Copy of Registrant's Management Agreement with Cornerstone Investment
Management, Advisor to the Cornerstone MVP Fund, which was filed as an Exhibit
to Registrants Post-Effective Amendment No. 29, is hereby incorporated by
reference.
(xvii) Copy of Registrant's Management Agreement with Carl Domino Associates,
L.P., Advisor to the Carl Domino Growth Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 23, is hereby incorporated by
reference.
(xviii) Copy of Registrant's Management Agreement with Carl Domino Associates,
L.P., Advisor to the Carl Domino Global Equity Income Fund, which was filed as
an Exhibit to Registrant's Post-Effective Amendment No. 23, is hereby
incorporated by reference.
(xix) Copy of Registrant's Management Agreement with Dobson Capital Management,
Inc,. Advisor to the Dobson Covered Call Fund, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 25, is hereby incorporated by
reference.
(xx) Copy of Registrant's Proposed Management Agreement with Auxier Asset
Management, LLC, Advisor to the Auxier Focus Fund, which was filed as an Exhibit
to Registrant's Post-Effective Amendment No. 19, is hereby incorporated by
reference.
(xxi) Copy of Registrant's Management Agreement with Cornerstone Capital
Management, Inc., Advisor to the Shepherd Values Market Neutral Fund, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 27, is hereby
incorporated by reference.
(xxii) Copy of Registrant's Management Agreement with Cornerstone Capital
Management, Inc., Advisor to the Shepherd Values Growth Fund, which was filed as
an Exhibit to Registrant's Post-Effective Amendment No. 27, is hereby
incorporated by reference.
(xxiii) Copy of Registrant's Proposed Management Agreement with Columbia
Partners, L.L.C., Investment Management, Advisor to the Columbia Partners Equity
Fund, which was filed as an Exhibit to Registrant's Post-Effective Amendment No.
20, is hereby incorporated by reference.
(xxiv) Copy of Registrant's Proposed Management Agreement with Legacy Investment
Group, LLC, d/b/a Cash Management Systems ("CMS"), Adviser to The Cash Fund,
which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 22,
is hereby incorporated by reference.
(xxv) Copy of Sub-Advisory Agreement between Cash Management Systems, Inc. and
Milestone Capital Management, L.P., Sub-Advisor to The Cash Fund is filed
herewith.
(xxvi) Copy of Registrant's Management Agreement with Ariston Capital Management
Corporation, Advisor to the Ariston Convertible Securities Fund, which was filed
as an Exhibit to Registrant's Post-Effective Amendment No. 27, is hereby
incorporated by reference.
(xxvii) Copy of Registrant's Management Agreement with Leader Capital Corp.,
Advisor to the Leader Converted Mutual Bank Fund, which was filed as an Exhibit
to Registrant's Post-Effective Amendment No. 29, is hereby incorporated by
reference.
(xxviii) Copy of Registrant's Proposed Management Agreement with Shepherd
Advisory Services, Inc., Advisor to the Shepherd Values VIF Equity Fund, which
was filed as an Exhibit to Registrant's Post-Effective Amendment No. 29, is
hereby incorporated by reference.
(xxix) Copy of Registrant's Proposed Management Agreement with Shepherd Advisory
Services, Inc., Advisor to the Shepherd Values Small-Cap Fund, which was filed
as an Exhibit to Registrant's Post-Effective Amendment No. 29, is hereby
incorporated by reference.
(xxx) Copy of Registrant's Proposed Management Agreement with Shepherd Advisory
Services, Inc., Advisor to the Shepherd Values International Fund, which was
filed as an Exhibit to Registrant's Post-Effective Amendment No. 29, is hereby
incorporated by reference.
(xxvii) Copy of Registrant's Proposed Management Agreement with Shepherd
Advisory Services, Inc., Advisor to the Shepherd Values Fixed Income Fund, which
was filed as an Exhibit to Registrant's Post-Effective Amendment No. 29, is
hereby incorporated by reference.
(xxxii) Sub-Advisory Agreements for the VIF Equity Fund, International Fund, the
Small-Cap Fund, and the Fixed Income Fund [to be supplied].
(xxxiii) Copy of Registrant's Proposed Management Agreement with Aegis Asset
Management, Inc., Advisor to the Westcott Nothing But Net Fund, which was filed
as an Exhibit to Registrant's Post-Effective Amendment No. 27, is hereby
incorporated by reference.
(xxxiv) Copy of Registrant's Proposed Management Agreement with Aegis Asset
Management, Inc., Advisor to the Westcott Large-Cap Fund, which was filed as an
Exhibit to Registrant's Post Effective-Amendment No. 27, is hereby incorporated
by reference.
(xxxv) Copy of Registrant's Proposed Management Agreement with Aegis Asset
Management, Inc., Advisor to the Westcott Fixed Income Fund, which was filed as
an Exhibit to Registrant's Post-Effective Amendment No. 27, is hereby
incorporated by reference.
(xxxvi) Copy of Registrant's Proposed Management Agreement with Jenswold, King &
Associates, Adviser to the Fountainhead Kaleidoscope Fund, which was filed as an
Exhibit to Registrant's Post-Effective Amendment No. 28, is hereby incorporated
by reference.
(e) Underwriting Contracts.
(i) Copy of Registrant's Amended and Restated Underwriting Agreement with
AmeriPrime Financial Securities, Inc., which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 8, is hereby incorporated by
reference.
(ii) Copy of Registrant's proposed Underwriting Agreement with AmeriPrime
Financial Securities, Inc. and OMNI Financial Group, LLC, which was filed as an
Exhibit to Registrant's Post-Effective Amendment No. 12, is hereby incorporated
by reference.
(f) Bonus or Profit Sharing Contracts.- None.
(g) Custodial Agreements.
(i) Copy of Registrant's Agreement with the Custodian, Firstar Bank, N.A.
(formerly Star Bank), which was filed as an Exhibit to Registrant's
Post-Effective Amendment No. 11, is hereby incorporated by reference.
(ii) Copy of Registrant's Appendix B to the Agreement with the Custodian, Star
Bank, N.A., which was filed as an Exhibit to Registrant's Post-Effective
Amendment No. 8, is hereby incorporated by reference.
(iii) Copy of Registrant's Agreement with UMB Bank, N.A., Custodian to the
Dobson Covered Call Fund, which was filed as an Exhibit to Registrant's
Post-Effective Amendment No. 28, is hereby incorporated by reference.
(h) Other Material Contracts. Copy of Registrant's Agreement with the
Administrator, AmeriPrime Financial Services, Inc., which was filed as an
Exhibit to Registrant's Post-Effective Amendment No. 11, is hereby incorporated
by reference.
(i) Legal Opinion.
(i) Opinion of Brown, Cummins & Brown Co., L.P.A., which was filed as an Exhibit
to Registrant's Post-Effective Amendment No. 9, is hereby incorporated by
reference.
(ii) Opinion of Brown, Cummins & Brown Co., L.P.A., which was filed as an
Exhibit to Registrant's Post-Effective Amendment No. 29, is hereby incorporated
by reference. (iii) Consent of Brown, Cummins & Brown Co., L.P.A is filed
herewith.
(j) Other Opinions. Consent of Accountant is filed herewith.
(k) Omitted Financial Statements.- None.
(l) Initial Capital Agreements. Copy of Letter of Initial Stockholders, which
was filed as an Exhibit to Registrant's Post-Effective Amendment No. 11, is
hereby incorporated by reference.
(m) Rule 12b-1 Plan.
(i) Form of Registrant's Rule 12b-1 Service Agreement which was filed as an
Exhibit to Registrant's Post-Effective Amendment No. 1, is hereby incorporated
by reference.
(ii) Copy of Registrant's Rule 12b-1 Distribution Plan for the Austin
Opportunity Fund, which was filed as an Exhibit to Registrant's Post-Effective
Amendment No. 17, is hereby incorporated by reference.
(iii) Copy of Registrant's Rule 12b-1 Distribution Plan for the Texas
Opportunity Fund, which was filed as an Exhibit to Registrant's Post-Effective
Amendment No. 17, is hereby incorporated by reference.
(iv) Copy of Registrant's Rule 12b-1 Distribution Plan for the U.S. Opportunity
Fund, which was filed as an Exhibit to Registrant's Post-Effective Amendment No.
17, is hereby incorporated by reference.
(v) Copy of Registrant's Rule 12b-1 Distribution Plan for the Jumper Strategic
Advantage Fund, which was filed as an Exhibit to Registrant's Post-Effective
Amendment No. 24, is hereby incorporated by reference.
(vi) Copy of Registrant's Rule 12b-1 Distribution Plan for the Dobson Covered
Call Fund, which was filed as an Exhibit to Registrant's Post-Effective
Amendment No. 24, is hereby incorporated by reference.
(vii) Copy of Registrant's Rule 12b-1 Distribution Plan for the Ariston
Convertible Securities Fund, which was filed as an Exhibit to Registrant's
Post-Effective Amendment No. 27, is hereby incorporated by reference.
(viii) Copy of Registrant's Rule 12b-1 Distribution Plan for the Leader
Converted Mutual Bank Fund, which was filed as an Exhibit to Registrant's
Post-Effective Amendment No. 27, is hereby incorporated by reference.
(ix) Copy of Registrant's Rule 12b-1 Distribution Plan for the Westcott Nothing
But Net Fund, which was filed as an Exhibit to Registrant's Post-Effective
Amendment No. 28, is hereby incorporated by reference.
(x) Copy of Registrant's Rule 12b-1 Distribution Plan for the Westcott Large-Cap
Fund, which was filed as an Exhibit to Registrant's Post-Effective Amendment No.
28, is hereby incorporated by reference.
(xi) Copy of Registrant's Rule 12b-1 Distribution Plan for the Westcott Fixed
Income Fund, which was filed as an Exhibit to Registrant's Post-Effective
Amendment No. 28, is hereby incorporated by reference.
(n) Financial Data Schedule - None.
(o) Rule 18f-3 Plan.
(i) Rule 18f-3 Plan for the Carl Domino Equity Income Fund, which was filed as
an Exhibit to Registrant's Post-Effective Amendment No. 16, is hereby
incorporated by reference.
(ii) Rule 18f-3 Plan for the Jumper Strategic Advantage Fund, which was filed as
an Exhibit to Registrant's Post-Effective Amendment No. 21, is hereby
incorporated by reference.
(iii) Rule 18f-3 Plan for the Westcott Funds, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 28, is hereby incorporated by
reference.
(p) Power of Attorney.
(i) Power of Attorney for Registrant and Certificate with respect thereto, which
were filed as an Exhibit to Registrant's Post-Effective Amendment No. 5, are
hereby incorporated by reference.
(ii) Powers of Attorney for Trustees and Officers, which were filed as an
Exhibit to Registrant's Post-Effective Amendment No. 5, are hereby incorporated
by reference.
(iii) Power of Attorney for the Treasurer of the Trust, which was filed as an
Exhibit to Registrant's Post-Effective Amendment No. 24, is hereby incorporated
by reference.
Item 24. Persons Controlled by or Under Common Control with the Registrant (As
of July 31, 1999)
(a) The Tennessee Aquarium may be deemed to control the Jumper Strategic
Advantage Fund as a result of its beneficial ownership of the Fund
(99.26%). The Registrant is unaware of any person under common control
with the Fund.
(b) Michael F. Horn, Sr. may be deemed to control the Columbia Partners Equity
Fund as a result of his beneficial ownership of the Fund (30.16%). The
Registrant is unaware of any person under common control with the Fund.
(c) The Thomet Family Trust may be deemed to control the Shepherd Values
Market Neutral Fund as a result of its beneficial ownership of the Fund
(34.01%). The Registrant is unaware of any persons under common control
with the Fund.
(d) Each of Carl Domino and Carl Domino Associates, L.P., may be deemed to
control the Domino Global Equity Income Fund as a result of their
respective beneficial ownership of the Fund (62.1% and 37.9%
respectively). Carl Domino may be deemed to control the Domino Growth Fund
as a result of his beneficial ownership of the Fund (68.98%). Carl Domino
controls Carl Domino Associates, L. P. (a Florida limited partnership)
because he controls the general partner. As a result, Carl Domino
Associates, L.P., the Domino Growth Fund and the Domino Global Equity
Income Fund may be deemed to be under the common control of Carl Domino.
(e) Marilyn C. Franken may be deemed to control the Shepherd Values Growth Fund
as a result of her beneficial ownership of the Fund (51.78%). The
Registrant is unaware of any person under common control with the Fund.
(f) Charles L. Dobson, may be deemed to control the Dobson Covered Call Fund as
a result of his beneficial ownership of the Fund (63.23%). Charles L.
Dobson controls Dobson Capital Management, Inc. (a California corporation)
because he owns 100% of its shares. As a result, Dobson Capital Management,
Inc. and the Fund may be deemed to be under the common control of Charles
L.
Dobson.
(g) J. Jeffrey Auxier may be deemed to control the Auxier Focus Fund as a
result of his beneficial ownership of the Fund (99.37%). J. Jeffrey Auxier
controls Auxier Asset Management, LLC (an Oregon limited liability company)
because he owns a majority of its shares. As a result, Auxier Asset
Management, LLC and the Fund may be deemed to be under the common control
of J. Jeffrey Auxier.
Item 25. Indemnification
(a) Article VI of the Registrant's Declaration of Trust provides for
indemnification of officers and Trustees as follows:
Section 6.4 Indemnification of Trustees, Officers, etc. Subject to and
except as otherwise provided in the Securities Act of 1933, as amended, and the
1940 Act, the Trust shall indemnify each of its Trustees and officers (including
persons who serve at the Trust's request as directors, officers or trustees of
another organization in which the Trust has any interest as a shareholder,
creditor or otherwise (hereinafter referred to as a "Covered Person") against
all liabilities, including but not limited to amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such person may be or may have been
threatened, while in office or thereafter, by reason of being or having been
such a Trustee or officer, director or trustee, and except that no Covered
Person shall be indemnified against any liability to the Trust or its
Shareholders to which such Covered Person would otherwise be subject by reason
of willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such Covered Person's office.
Section 6.5 Advances of Expenses. The Trust shall advance attorneys'
fees or other expenses incurred by a Covered Person in defending a proceeding to
the full extent permitted by the Securities Act of 1933, as amended, the 1940
Act, and Ohio Revised Code Chapter 1707, as amended. In the event any of these
laws conflict with Ohio Revised Code Section 1701.13(E), as amended, these laws,
and not Ohio Revised Code Section 1701.13(E), shall govern.
Section 6.6 Indemnification Not Exclusive, etc. The right of
indemnification provided by this Article VI shall not be exclusive of or affect
any other rights to which any such Covered Person may be entitled. As used in
this Article VI, "Covered Person" shall include such person's heirs, executors
and administrators. Nothing contained in this article shall affect any rights to
indemnification to which personnel of the Trust, other than Trustees and
officers, and other persons may be entitled by contract or otherwise under law,
nor the power of the Trust to purchase and maintain liability insurance on
behalf of any such person.
The Registrant may not pay for insurance which protects the Trustees
and officers against liabilities rising from action involving willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of their offices.
(b) The Registrant may maintain a standard mutual fund and investment advisory
professional and directors and officers liability policy. The policy, if
maintained, would provide coverage to the Registrant, its Trustees and officers,
and could cover its Advisers, among others. Coverage under the policy would
include losses by reason of any act, error, omission, misstatement, misleading
statement, neglect or breach of duty.
(c) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to trustees, officers and controlling persons of the
Registrant pursuant to the provisions of Ohio law and the Agreement and
Declaration of the Registrant or the By-Laws of the Registrant, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a trustee, officer or controlling
person of the Trust in the successful defense of any action, suit or proceeding)
is asserted by such trustee, officer or controlling person in connection with
the securities being registered, the Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
Item 26. Business and Other Connections of Investment Adviser
A. Carl Domino Associates, L.P., 580 Village Boulevard, Suite 225, West Palm
Beach, Florida 33409, ("CDA"), adviser to the Carl Domino Equity Income Fund,
the Carl Domino Growth Fund and the Carl Domino International Global Equity
Income Fund, is a registered investment adviser.
(1) CDA has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
partners and officers of CDA during the past two years.
(a) Lawrence Katz, a partner in CDA, is an orthopedic surgeon in private
practice.
(b) Saltzman Partners, a partner in CDA, is a limited partnership that invests
in companies and businesses.
(c) Cango Inversiones, SA, a partner in CDA, is a foreign business entity that
invests in U.S. companies and businesses.
B. King Investment Advisors Inc., 1980 Post Oak Boulevard, Suite 2400, Houston,
Texas 77056-3898 ("King King"), adviser to the Fountainhead Special Value Fund
and the Fountainhead Kaleidoscope Fund, is a registered investment adviser.
(1) King has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of King during the past two years.
(a) John Servis, a director of JKA King, is a licensed real estate broker.
C. GLOBALT, Inc., 3060 Peachtree Road, N.W., One Buckhead Plaza, Suite 225,
Atlanta, Georgia 30305 ("GLOBALT"), adviser to GLOBALT Growth Fund, is a
registered investment adviser.
(1) GLOBALT has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
officers and directors of GLOBALT during the past two years.
(a) Gregory S. Paulette, an officer of GLOBALT, is the president of GLOBALT
Capital Management, a division of GLOBALT.
D. IMS Capital Management, Inc., 10159 S.E. Sunnyside Road, Suite 330, Portland,
Oregon 97015, ("IMS"), Adviser to the IMS Capital Value Fund, is a registered
investment adviser.
(1) IMS has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of IMS during the past two years - None.
E. CommonWealth Advisors, Inc., 929 Government Street, Baton Rouge, Louisiana
70802, ("CommonWealth"), Adviser to the Florida Street Bond Fund and the Florida
Street Growth Fund, is a registered investment adviser.
(1) CommonWealth has engaged in no other business during the past two fiscal
years.
(2) The following list sets forth other substantial business activities of the
directors and officers of CommonWealth during the past two years.
(a) Walter A. Morales, President/Chief Investment Officer of CommonWealth was
the Director of an insurance/broadcasting corporation, Guaranty Corporation, 929
Government Street, Baton Rouge, Louisiana 70802 from August 1994 to February
1996. From September 1994 through the present, a registered representative of a
Broker/Dealer company, Securities Service Network, 2225 Peters Road, Knoxville,
Tennessee 37923. Beginning August 1995 through the present, an instructor at the
University of Southwestern Louisiana in Lafayette, Louisiana.
F. Corbin & Company, 1320 S. University Drive, Suite 406, Fort Worth, Texas
76107, ("Corbin"), Adviser to the Corbin Small-Cap Value Fund, is a registered
investment adviser.
(1) Corbin has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of Corbin during the past two years - None.
G. Vuong Asset Management Company, LLC, 6575 West Loop South, Suite 110,
Houston, Texas 77401, ("VAMCO"), Adviser to the MAI Family of Funds, is a
registered investment adviser.
(1) VAMCO has engaged in no other business during the past two fiscal years.
(2) The following list sets forth substantial business activities of the
directors and officers of VAMCO during the past two years.
(a) Qui Tu Vuong, the Chief Investment Officer and head of Equity Asset
Management of VAMCO, is the Chief Executive Officer of Vuong & Co., LLC, a
holding company at 6575 West Loop South #110, Bellaire, Texas 77401; and Sales
Manager/Equities Regulation Representative of Omni Financial Group, LLC, a
securities brokerage company at 6575 West Loop South #110, Bellaire, Texas
77401; and President of Oishiicorp, Inc., an investment advising corporation at
6575 West Loop South #110, Bellaire, Texas 77401; and Managing General Partner
of Sigma Delta Capital Appreciation Funds, LP, an investment company at 6575
West Loop South #110, Bellaire, Texas 77401; and President of Premier Capital
Management and Consulting Group, Inc., a financial consulting corporation at
6575 West Loop South #170, Bellaire, Texas 77401; and from August, 1992 through
February, 1996, he was a registered representative of Securities America, Inc.,
a securities brokerage corporation at 6575 West Loop South #170, Bellaire, Texas
77401.
(b) Quyen Ngoc Vuong, President, Chairman and Chief Financial Officer of VAMCO,
is the Manager of Vuong & Company, LLC, and Manager of Omni Financial Group,
LLC.
(c) Can Viet Le, Manager of VAMCO, is the Manager of Vuong and Company, LLC, and
was Co Founder and Chief Financial Officer of Tribe Computer Works, a
manufacturing network in Alameda, California from April 1990 through January,
1996.
H. CWH Associates, Inc., 200 Park Avenue, Suite 3900, New York, New York 10166,
("CWH"), Advisor to the Worthington Theme Fund, is a registered investment
Advisor.
(1) CWH has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of CWH during the past two years.
Andrew M. Abrams, the Chief Operating Officer of CWH, is a General Partner of
Abrams Investment Partners, L.P., an investment limited partnership at 200 Park
Avenue, Suite 3900, New York, New York 10166.
I. Burroughs & Hutchinson, Inc., 702 West Idaho Street, Suite 810, Boise, Idaho
("B&H"), advisor to Marathon Value Fund, is a registered investment adviser.
(1) B&H has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of B&H during the past two years.
Mark R. Matsko, Vice President and Director of B&H, was broker with D.A.
Davidson & Co., a broker/dealer in Boise, Idaho, from 1994 to 1996.
J. The Jumper Group, Inc., 1 Union Square, Suite 505, Chattanooga, Tennessee
37402, ("Jumper"), Advisor to the Jumper Strategic Advantage Fund, is a
registered investment advisor.
(1) Jumper has engaged in no other business during the past two fiscal years.
(2) The following list set forth other substantial business activities of the
directors and officers of Jumper during the past two years - None.
K. Appalachian Asset Management, Inc., 1018 Kanawha Blvd., East, Suite 209,
Charleston, WV 25301 ("AAM"), advisor to AAM Equity Fund, is a registered
investment advisor.
(1) AAM has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of AAM during the past two years - None.
L. Martin Capital Advisors, L.L.P. ("Martin"), 816 Congress Ave., Suite 1540,
Austin, TX 78701 ("Martin"), advisor to Austin Opportunity Fund, Texas
Opportunity Fund, and U.S. Opportunity Fund, is a registered investment advisor.
(1) Martin has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of GJMB during the past two years - None.
M. Gamble, Jones, Morphy & Bent, Inc., 301 East Colorado Boulevard, Suite 802,
Pasadena, California 91101 ("GJMB"), Advisor to the GJMB Fund, is a registered
investment advisor.
(1) GJMB has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of GJMB during the past two years - None.
N. Cornerstone Investment Management, L.L.C. 132 West Main Street, Aspen,
Colorado 81611 ("Cornerstone"), Advisor to the Cornerstone MVP Fund, is a
registered investment advisor.
(1) Cornerstone has engaged in no other business during the past two fiscal
years.
(2) The following list sets forth other substantial business activities of the
directors and officers of Cornerstone during the past two years:
Christopher Shawn Ryan, managing member of Cornerstone, was Vice
President-Portfolio Manager at NationsBank in Dallas, Texas from January 1994 to
October 1997.
O. Dobson Capital Management, Inc., 1422 Van Ness Street., Santa Ana, CA 92707
("Dobson"), Advisor to the Dobson Covered Call Fund, is a registered investment
advisor.
(1) Dobson has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of Dobson during the past two years: Charles L. Dobson,
President of Dobson, was the Director of Trading with Analytic/TSA Global Asset
Management, 700 S.
Flower Street, Suite 2400, Los Angeles CA, from 1996 to 1998.
P. Auxier Asset Management, LLC, 8050 S.W. Warm Springs, Suite 130, Tualatin, OR
97062 ("Auxier"), Advisor to the Auxier Focus Fund, is registered investment
advisor.
(1) Auxier has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of Auxier during the past two years: Jeffrey Auxier,
Managing Member of Auxier, was a Senior Portfolio Management Director with Smith
Barney, Inc. until 1998.
Q. Cornerstone Capital Management, Inc., 6760 Corporate Drive, Suite 230,
Colorado Springs, CO 80919 ("CCM"), Adviser to the Shepherd Value Market Fund
and the Shepherd Value Growth Fund, is a registered investment advisor.
(1) CCM has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of CCM during the past two years:
a) Darrel Uselton, Director of CCM, is the Chairman of The National Capital
Companies, an investment banking firm.
b) Joseph Cerbone, Director of CCM, is the President of The National Capital
Companies, an investment banking firm.
c) Jason D. Huntley, Director of CCM, was Director of Institutional Services
with First Affirmative/Walnut Street Advisers, Colorado Springs, CO, an
investment advisory firm, from 1996 to 1997.
d) Colleen Helm, Director of CCM, was a portfolio manager with Angell Financial,
an investment adviser, from January 1998 to November 1999. Prior to that, she
was a portfolio manager with Pinnacle Financial Advisory Group, an investment
adviser.
e) Donald Ellsworth, Director of CCM, was the President of Ellsworth Advisory
Group, Inc., an investment counseling firm, from June 1987 until June 1999.
R. Columbia Partners, L.L.C., Investment Management, 1775 Pennsylvania Avenue,
N.W., Washington, DC 20006 ("Columbia"), Advisor to the Columbia Partners Equity
Fund, is a registered investment advisor.
(1) Columbia has engaged in no other business during the past two fiscal years.
(2) The following list sets forth other substantial business activities of the
directors and officers of Columbia during the past two years:
Rhys H. Williams, a principal of Columbia, has been a portfolio manager at
Columbia since late 1997. Prior to that time, Mr. Williams was the Senior Vice
President at Prudential Securities in Philadelphia, PA since 1987.
S. Legacy Investment Group, LLC, d/b/a Cash Management Systems, 290 Turnpike
Road, #338, Westborogh, Massachusetts ("CMS), Advisor to The Cash Fund, is a
registered investment advisor.
1. CMS has engaged in no other business during the past two years.
2. The following list sets forth other substantial business activities of the
directors and officers of CMS during the past two years:
David W. Reavill, Member of CMS, was a Vice President with Fixed Income Discount
Advisory Corp., Shrewsbury, MA, a money market firm, from 1997 to 1998 and a
Vice President of Reich & Tang, LLC, Westlake Village, CA, a money market firm,
from 1996 to 1997.
T. Ariston Capital Management Corporation, 40 Lake Bellevue Drive, Suite 220,
Bellevue, Washington 98005 ("Ariston"), Advisor to the Ariston Convertible
Securities Fund, is a registered investment advisor.
1. Ariston has engaged in no other business during the past two years.
2. The following list sets forth other substantial business activities of the
directors and officers of Ariston during the past two years: None.
U. Leader Capital Corp., 121 S.W. Morrison St., Ste. 450, Portland, OR 97204
("Leader"), Adviser to the Leader Converted Mutual Bank Fund, is a registered
investment advisor.
1. Leader has engaged in no other business during the past two fiscal years.
2. The following list sets forth other substantial business activities of the
directors and officers of Leader during the past two years:
(a) John Lekas, President of Leader, was a registered representative with Smith
Barney from July 1993 to November 1997.
(b) Jason McMillen, Vice President of Leader, was a research assistant with
Smith Barney from December 1996 to December 1997.
(c) Carey Guenther, Secretary of Leader, was a customer account representative
with Columbia Funds from July 1997 to January, 1998.
V. Aegis Asset Management, Inc. ("Aegis"), 230 Westcott, Suite 1, Houston, Texas
77007, Adviser to Westcott Nothing But Net Fund, Westcott Large-Cap Fund and
Westcott Fixed Income Fund, is a registered investment adviser.
1. Aegis has engaged in no other business during the past two fiscal years.
The following list sets forth other substantial business activities of the
directors and officers of Aegis during the past two years:
(a) Thomas Layng Guerriero, President of Aegis, has been the President of Aegis
& Co, L.L.C., an asset management firm, from January 1993 to the present, and
has been the President of Westcott Securities, L.L.C., a broker/dealer, from
April 1998 to the present.
(b) William S. Kilroy, a Director of Aegis, has been the CEO of Aegis & Co,
L.L.C., an asset management firm, from January 1993 to the present.
Item 27. Principal Underwriters
A. AmeriPrime Financial Securities, Inc., is the Registrant's principal
underwriter. Kenneth D. Trumpfheller, 1793 Kingswood Drive, Suite 200,
Southlake, Texas 76092, is the President, Secretary and Treasurer of the
underwriter and the President and a Trustee of the Registrant. It is also the
underwriter for the AmeriPrime Insurance Trust, the Kenwood Funds, the Rockland
Funds Trust and the TANAKA Funds, Inc. B. Information with respect to each
director and officer of AmeriPrime Financial Securities, Inc. is incorporated by
reference to Schedule A of Form BD filed by it under the Securities Exchange Act
of 1934 (File No. 8-48143). C. Not applicable.
Item 28. Location of Accounts and Records
Accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules promulgated
thereunder will be maintained by the Registrant at 1793 Kingswood Drive, Suite
200, Southlake, Texas 76092 and/or by the Registrant's Custodian, Star Bank,
N.A., 425 Walnut Street, Cincinnati, Ohio 45202, and/or transfer and shareholder
service agents, American Data Services, Inc., Hauppauge Corporate Center, 150
Motor Parkway, Hauppauge, New York 11760 and Unified Fund Services, Inc., 431
Pennsylvania Street, Indianapolis, IN 46204.
Item 29. Management Services Not Discussed in Parts A or B
None.
Item 30. Undertakings
None.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, duly authorized, in the
City of Cincinnati, State of Ohio, on the 8th___ day of October, 1999.
AmeriPrime Funds
By:_______/s/____________________________
Donald S. Mendelsohn,
Attorney-in-Fact
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Kenneth D. Trumpfheller,
President and Trustee
By:_________/s/_________________________
Donald S. Mendelsohn,
Gary E. Hippensteil, Trustee Attorney-in-Fact
Steve L. Cobb, Trustee October 8, 1999
Paul S. Bellany, Treasurer
<PAGE>
EXHIBIT INDEX
1. Amendment No. 18 to Declaration of Trust ......................EX-99.23.a.1
2. Amendment No. 19 to Declaration of Trust.......................EX-99.23.a.2
3. Sub-Advisory Agreement for The Cash Fund.........................EX-99.23.d
4. Consent of Counsel...............................................EX-99.23.i
5. Consent of Accountant............................................EX-99.23.j
AMERIPRIME FUNDS AMENDMENT NO. 18
AGREEMENT AND DECLARATION OF TRUST
1. Pursuant to Section 4.1 of the Agreement and Declaration of Trust of
Ameriprime Funds and effective upon the execution of this document, the
undersigned, being a majority of the trustees of AmeriPrime Funds, hereby:
(a) establish four new series of shares of the Trust and designate such series
the "Shepherd Values International Fund", the "Shepherd Values VIF Equity
Fund", the "Shepherd Values Fixed Income Fund" and the "Shepherd Values
Small-Cap Fund"; and
(b) change the name of the Leader Mutual Bank Fund to the Leader Converted
Mutual Bank Fund; and
(c) the relative rights and preferences of each series shall be those rights
and preferences set forth in Section 4.2 of the Agreement and Declaration
of Trust of AmeriPrime Funds.
2. This document shall have the status of an Amendment to said Agreement and
Declaration of Trust, and may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
____/s/__________________________
Steve L. Cobb
____/s/__________________________
Gary E. Hippenstiel
___/s/___________________________
Kenneth D. Trumpfheller
Dated: June 25, 1999
AMERIPRIME FUNDS AMENDMENT NO. 19
AGREEMENT AND DECLARATION OF TRUST
1. Pursuant to Section 4.1 of the Agreement and Declaration of Trust of
Ameriprime Funds and effective upon execution of this document, the undersigned,
being a majority of the trustees of AmeriPrime Funds, hereby
a) establish four new series of shares of the Trust and designate such series
the "Westcott Nothing But Net Fund," "Westcott Large-Cap Fund," "Westcott
Fixed Income Fund," and "Fountainhead Kaleidoscope Fund" (the "Series");
and b) the relative rights and preferences of each Series shall be those
rights and preferences set forth in Section 4.2 of the Agreement and
Declaration of Trust of AmeriPrime Funds.
2. This document shall have the status of an Amendment to said Agreement and
Declaration of Trust, and may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
___/s/_________________________
Steve L. Cobb
___/s/_________________________
Gary E. Hippensteil
__/s/_________________________
Kenneth D. Trumpfheller
Dated September 29, 1999
INVESTMENT SUBADVISORY AGREEMENT
BETWEEN
CASH MANAGEMENT SYSTEMS, INC.
AND
MILESTONE CAPITAL MANAGEMENT, L.P.
AGREEMENT made as of the 1st day of September, 1999, by and between
Cash Management Systems, Inc., a Nevada corporation (the "Adviser") and
Milestone Capital Management, L.P., a limited partnership organized under the
laws of the State of New York (the "Sub-Adviser").
WHEREAS, the Adviser provides investment advisory services to The Cash
Fund (the "Fund"), a series of AmeriPrime Funds, an Ohio business trust (the
"Trust"), which is registered as an open-end, management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"), pursuant
to a Management Agreement dated (the Management Agreement"); and
WHEREAS, the Sub-Adviser is a registered investment adviser under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"); and
WHEREAS, the Adviser desires to retain the Sub-Adviser to furnish
investment subadvisory services in connection with the Fund and the Sub-Adviser
represents that it is willing and possesses legal authority to so furnish such
services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Adviser hereby appoints the Sub-Adviser to act as
investment subadviser to the Fund for the period and on the terms set forth in
this Agreement. The Sub-Adviser accepts such appointment and agrees to furnish
the services herein set forth for the compensation herein provided.
2. DELIVERY OF DOCUMENTS. The Adviser has delivered to the Sub-Adviser
copies of each of the following documents along with all amendments thereto
through the date hereof, and will promptly deliver to it all future amendments
and supplements thereto, if any:
<PAGE>
(a) the Trust's Declaration of Trust ;
(b) the By-Laws of the Trust;
(c) resolutions of the Board of Trustees of the Trust authorizing the
execution and delivery of the Advisory Agreement and this Agreement;
(d) the most recent Post-Effective Amendment to the Trust's Registration
Statement under the Securities Act of 1933, as amended (the "1933
Act"), and the 1940 Act, on Form N-1A as filed with the Securities and
Exchange Commission (the "Commission");
(e) Notification of Registration of the Trust under the 1940 Act on Form
N-8A as filed with the Commission; and
(f) the currently effective Prospectus and Statement of Additional
Information of the Fund.
3. INVESTMENT ADVISORY SERVICES.
(a) MANAGEMENT OF THE FUND. The Sub-Adviser hereby undertakes to act as
investment subadviser to the Fund. The Sub-Adviser shall regularly
provide investment advice to the Fund and continuously supervise the
investment and reinvestment of cash, securities and other property
composing the assets of the Fund and, in furtherance thereof, shall:
(i) obtain and evaluate pertinent economic, statistical and financial
data, as well as other significant events and developments, which
affect the economy generally, the Fund's investment program, and
the issuers of securities included in the Fund's portfolio and
the industries in which they engage, or which may relate to
securities or other investments which the Sub-Adviser may deem
desirable for inclusion in the Fund's portfolio;
(ii) determine which issuers and securities shall be included in the
portfolio of the Fund;
(iii) furnish a continuous investment program for the Fund;
(iv) in its discretion, and without prior consultation, buy, sell,
lend and otherwise trade any securities and investment
instruments on behalf of the Fund; and
(v) take, on behalf of the Fund, all actions the Sub-Adviser may deem
necessary in order to carry into effect such investment program
and the Sub-Adviser's functions as provided above, including the
making of appropriate periodic reports to the Adviser and the
Trust's Board of Trustees.
(b) COVENANTS. The Sub-Adviser shall carry out its investment subadvisory
responsibilities in a manner consistent with the investment
objectives, policies, and restrictions provided in: (i) the Fund's
Prospectus and Statement of Additional Information as revised and in
effect from time to time; (ii) the Trust's Declaration of Trust,
By-Laws or other governing instruments, as amended from time to time;
(iii) the 1940 Act; (iv) other applicable laws; and (v) such other
investment policies, procedures and/or limitations as may be adopted
by the Trust or the Adviser with respect to the Fund and provided to
the Sub-Adviser in writing. The management of the Fund by the
Sub-Adviser shall at all times be subject to the oversight and
supervision of the Adviser and the Trust's Board of Trustees.
(c) RESEARCH AND CREDIT SERVICES. The Sub-Adviser may obtain at its own
expense,supplemental research and credit services from others in
connection with its provision of services to the Fund under this
Agreement.
(d) BOOKS AND RECORDS. Pursuant to applicable law, the Sub-Adviser shall
keep the Fund's books and records required to be maintained by, or on
behalf of, the Fund with respect to subadvisory services rendered
hereunder. The Sub-Adviser agrees that all records which it maintains
for the Fund are the property of the Fund and it will promptly
surrender any of such records to the Fund upon the Fund's or the
Adviser's request. The Sub-Adviser further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act any such records
of the Fund required to be preserved by Rule 31a-1 under the 1940 Act.
(e) REPORTS, EVALUATIONS AND OTHER SERVICES. The Sub-Adviser shall furnish
reports, evaluations, information or analyses to the Adviser and the
Trust with respect to the Fund and in connection with the
Sub-Adviser's services hereunder as the Adviser and/or the Trust's
Board of Trustees may request from time to time or as the Sub-Adviser
may otherwise deem to be desirable. The Sub-Adviser shall make
recommendations to the Adviser and the Trust's Board of Trustees with
respect to the Fund's policies, and shall carry out such policies as
are adopted by the Board of Trustees. The Sub-Adviser may, subject to
review by the Adviser, furnish such other services as the Sub-Adviser
shall from time to time determine to be necessary or useful to perform
its obligations under this Agreement.
(f) BROKERAGE. In placing orders with brokers and/or dealers, the
Sub-Adviser is directed at all times to seek best price and execution
for purchases and sales on behalf of 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. Sub-Adviser should
generally seek favorable prices and commission rates that are
reasonable in relation to the benefits received. Subject to such
conditions as may be imposed by the Trust's Board of Trustees, the
Sub-Adviser may pay commissions to brokers and/or dealers that are
higher than might be charged by another qualified broker to obtain
brokerage and/or research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) considered by the Sub-Adviser to be useful or
desirable in the performance of the Sub-Adviser's duties hereunder, if
the Sub-Adviser determines in good faith that the amount of the
commission is reasonable in relation to the value of the brokerage and
research services provided by the executing broker or dealer. The
determination may be viewed in terms of either a particular
transaction or Sub-Adviser's overall responsibilities with respect to
the Fund and to accounts over which Sub-Adviser exercises investment
discretion. The Sub-Adviser understands and acknowledges that,
although the information may be useful to the Fund and the
Sub-Adviser, it is not possible to place a dollar value on such
information. The Board shall periodically review the commissions paid
by the Fund to determine if the commissions paid over representative
periods of time were reasonable in relation to the benefits to the
Fund. Subject to the foregoing and to such conditions as may be
imposed by the Adviser or the Trust's Board of Trustees and the
provisions of the 1940 Act, Exchange Act and other applicable law,
nothing herein shall prohibit the Sub-Adviser from selecting brokers
and/or dealers who are "affiliated persons" of the Sub-Adviser, the
Adviser or the Trust.
Consistent with the Rules of Fair Practice of the National Association
of Securities Dealers, and subject to seeking best qualitative
execution as described above, the Sub-Adviser may give consideration
to sales of shares of the Fund as a factor in the selection of brokers
and dealers to execute Fund portfolio transactions.
(g) AGGREGATION OF SECURITIES TRANSACTIONS. In executing portfolio
transactions for the Fund, the Sub-Adviser may, to the extent
permitted by applicable laws and regulations, but shall not be
obligated to, aggregate the securities to be sold or purchased with
those of other funds or its other clients if, in the Sub-Adviser's
reasonable judgment, such aggregation (i) will result in an overall
economic benefit to the Fund, taking into consideration the
advantageous selling or purchase price, brokerage commission and other
expenses, and trading requirements, and (ii) is not inconsistent with
the policies set forth in the Trust's registration statement and the
Fund's Prospectus and Statement of Additional Information. In such
event, the Sub-Adviser will allocate the securities so purchased or
sold, and the expenses incurred in the transaction, in an equitable
manner, consistent with its fiduciary obligations to the Fund and such
other clients.
<PAGE>
4. REPRESENTATIONS AND WARRANTIES.
(a) The Sub-Adviser hereby represents and warrants to the Adviser as
follows:
(i) The Sub-Adviser is a Limited Partnership duly organized and in
good standing under the laws of the State of New York and is
fully authorized to enter into this Agreement and carry out its
duties and obligations hereunder.
(ii) The Sub-Adviser is registered as an investment adviser with the
Commission under the Advisers Act. The Sub-Adviser shall maintain
such registration in effect at all times during the term of this
Agreement.
(iii) The Sub-Adviser at all times shall provide its best judgment and
effort to the Adviser in carrying out the Sub-Adviser's
obligations hereunder.
(iv) The Sub-Adviser shall promptly notify the Adviser and the Trust
of any changes in general partner(s).
(b) The Adviser hereby represents and warrants to the Sub-Adviser as
follows:
(i) The Adviser is a corporation duly organized and in good standing
under the laws of the State of Nevada and is fully authorized to
enter into this Agreement and carry out its duties and
obligations hereunder.
(ii) The Trust has been duly organized as a business trust under the
laws of the State of Ohio.
(iii) The Trust is registered as an investment company with the
Commission under the 1940 Act, and shares of the Fund are
registered for offer and sale to the public under the 1933 Act
and all applicable state securities laws where currently sold.
Such registrations will be kept in effect during the term of this
Agreement. (iv)The Adviser will not include in the Prospectus and
Statement of Additional Information of the Fund or in
supplemental materials to investors information on the
Sub-Adviser that has not been provided or reviewed by the
Sub-Adviser.
5. COMPENSATION. As compensation for the services which the Sub-Adviser is to
provide or cause to be provided pursuant to Paragraph 3, with respect to
the Fund, the Adviser shall pay to the Sub-Adviser (or cause to be paid by
the Trust directly to the Sub-Adviser) a fee, which shall be accrued daily
and paid promptly in arrears after the last business day of each month, at
an annual rate of 0.08% of the average daily net assets of the Fund during
the preceding month (computed in the manner set forth in the Fund's most
recent Prospectus and Statement of Additional Information). In the event
that the Adviser waives a portion of the Advisory fee paid to it by the
Fund, the Sub-Adviser shall not be required to similarly waive a portion of
its sub-advisory fee. Average daily net assets shall be based upon
determinations of net assets made as of the close of business on each
business day throughout such month. The fee for any partial month shall be
calculated on a proportionate basis, based upon average daily net assets
for such partial month.
6. EXPENSES. The Sub-Adviser will pay all expenses incurred by it in
connection with its activities under this Agreement other than the cost of
securities (including brokerage commissions) purchased for or sold by the
Fund.
7. NON-EXCLUSIVE SERVICES; LIMITATION OF SUB-ADVISER'S LIABILITY. The services
of the Sub-Adviser hereunder are not to be deemed exclusive, and the
Sub-Adviser may render similar services to others and engage in other
activities. The Sub-Adviser and its affiliates may enter into other
agreements with the Fund, the Trust or the Adviser for providing additional
services to the Fund, the Trust or the Adviser which are not covered by
this Agreement, and to receive additional compensation for such services.
In the absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of obligations or duties hereunder on the part of the
Sub-Adviser, or a breach of fiduciary duty with respect to receipt of
compensation, neither the Sub-Adviser nor any of its partners, officers,
agents or employees shall be liable or responsible to the Adviser, the
Trust, the Fund or to any shareholder of the Fund for any error of judgment
or mistake of law or for any act or omission in the course of, or connected
with, rendering services hereunder or for any loss suffered by the Adviser,
the Trust, the Fund, or any shareholder of the Fund in connection with the
performance of this Agreement.
8. EFFECTIVE DATE; MODIFICATIONS; TERMINATION. This Agreement shall become
effective on the date hereof (the "Effective Date") provided that it shall
have been approved by a majority of the outstanding voting securities of
the Fund, in accordance with the requirements of the 1940 Act, or such
later date as may be agreed by the parties following such shareholder
approval.
(a) This Agreement shall continue in force for two years from the
Effective Date and shall continue in effect from year to year
thereafter for successive annual periods, provided such continuance is
specifically approved at least annually (i) by a vote of the majority
of the Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval, and (ii) by a vote
of the Board of Trustees of the Trust or a majority of the outstanding
voting securities of the Fund.
(b) The modification of any of the non-material terms of this Agreement
may be approved by a vote of a majority of those Trustees of the Trust
who are not interested persons of any party to this Agreement, cast in
person at a meeting called for the purpose of voting on such approval.
(c) Notwithstanding the foregoing provisions of this Paragraph 8, either
party hereto may terminate this Agreement at any time on sixty (60)
days' prior written notice to the other, without payment of any
penalty. A termination of the Sub-Adviser may be effected by the
Adviser, by a vote of the Trust's Board of Trustees, or by vote of a
majority of the outstanding voting securities of the Fund. This
Agreement shall terminate automatically in the event of its
assignment.
9. CERTAIN DEFINITIONS. The terms "vote of a majority of the outstanding
voting securities," "assignment," "control," and "interested persons," when
used herein, shall have the respective meanings specified in the 1940 Act.
References in this Agreement to the 1940 Act and the Advisers Act shall be
construed as references to such laws as now in effect or as hereafter
amended, and shall be understood as inclusive of any applicable rules,
interpretations and/or orders adopted or issued thereunder by the
Commission.
10. INDEPENDENT CONTRACTOR. The Sub-Adviser shall for all purposes herein be
deemed to be an independent contractor and shall, unless otherwise
expressly provided herein or authorized by the Board of Trustees of the
Trust from time to time, have no authority to act for or represent the Fund
or the Adviser in any way or otherwise be deemed an agent of the Fund or
the Adviser.
11. GOVERNING LAW. This Agreement shall be governed by the laws of the State of
Ohio provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act or the Advisers Act.
12. SEVERABILITY. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby and, to this extent, the
provisions of this Agreement shall be deemed to be severable.
13. NOTICES. Notices of any kind to be given to the Adviser hereunder by the
Sub-Adviser shall be in writing and shall be duly given if mailed or
delivered to the Adviser at 290 Turnpike Road, Westborough, MA 01581 or at
such other address or to such individual as shall be so specified by the
Adviser to the Sub-Adviser. Notices of any kind to be given to the
Sub-Adviser hereunder by the Adviser shall be in writing and shall be duly
given if mailed or delivered to the Sub-Adviser at One Executive Boulevard,
Yonkers, New York 10701 or at such other address or to such individual as
shall be so specified by the Sub-Adviser to the Adviser. Notices shall be
effective upon delivery.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
written above.
CASH MANAGEMENT SYSTEMS, INC. MILESTONE CAPITAL MANAGEMENT, L.P.
By: __/s/_________________________ By:__/s/__________________
Name: David Reavill Name: Janet Hanson
Title: President Title: President/CEO
9882 10/1/99 2:19 PM
BROWN, CUMMINS & BROWN CO., L.P.A.
ATTORNEYS AND COUNSELORS AT LAW
3500 CAREW TOWER
J. W. BROWN (1911-1995) 441 VINE STREET JOANN M. STRASSER
JAMES R. CUMMINS CINCINNATI, OHIO 45202 AARON A. VANDERLAAN
ROBERT S BROWN TELEPHONE (513) 381-2121
DONALD S. MENDELSOHN TELECOPIER (513) 381-2125 OF COUNSEL
LYNNE SKILKEN GILBERT BETTMAN
AMY G. APPLEGATE
KATHRYN KNUE PRZYWARA
MELANIE S. CORWIN
October 8, 1999
AmeriPrime Funds
1793 Kingswood Drive
Southlake, Texas 76092
Gentlemen:
Legal opinions that we prepared were filed with Post-Effective
Amendment No. 9 and Post-Effective Amendment No. 29 (the "Legal Opinions"). We
hereby give you our consent to incorporate by reference the Legal Opinions into
Post-Effective Amendment No. 30 to your Registration Statement (the
"Amendment"), and consent to all references to us in the Amendment.
Very truly yours,
______/s/_______________
Brown, Cummins & Brown Co., L.P.A.
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our report
dated August 16, 1999 and to all references to our firm included in or made a
part of this Post-Effective Amendment No. 30 to AmeriPrime Fund's Registration
Statement.
_/ s /___________________________
McCurdy & Associates CPA's, Inc.
Westlake, Ohio
September 30, 1999
