GJMB GROWTH FUND
PROSPECTUS
NOVEMBER 1, 1999
INVESTMENT OBJECTIVE:
Long term capital appreciation
310 East Colorado Boulevard
Suite 802
Pasadena, California 91191
(888) 912-4562
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.
9413 10/29/99 3:44 PM
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TABLE OF CONTENTS
PAGE
ABOUT THE FUND.................................................................1
FEES AND EXPENSES OF INVESTING IN THE FUND.....................................2
HOW TO BUY SHARES..............................................................3
HOW TO REDEEM SHARES...........................................................4
DETERMINATION OF NET ASSET VALUE...............................................5
DIVIDENDS, DISTRIBUTIONS AND TAXES.............................................6
MANAGEMENT OF THE FUND.........................................................6
YEAR 2000 ISSUE................................................................6
FINANCIAL HIGHLIGHTS...........................................................7
FOR MORE INFORMATION..................................................BACK COVER
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ABOUT THE FUND
INVESTMENT OBJECTIVE
The investment objective of the GJMB Growth Fund is long term capital
appreciation.
PRINCIPAL STRATEGIES
The Fund invests primarily in common stocks of U.S. companies which the
Fund's advisor believes offer superior prospects for growth. In this regard, the
advisor seeks to invest in stocks with the following characteristics:
o Market capitalization in excess of $5 billion
o Seasoned businesses with at least 5 years of audited financial information
o Industry leaders with strong brand recognition
o Experienced and proven management teams
The Fund may also invest to a limited extent in comparable stocks of
foreign companies by purchasing American Depositary Receipts ("ADRs"). An ADR is
a U.S. dollar denominated certificate that evidences ownership of shares of a
foreign company. They are alternatives to the direct purchase of the underlying
foreign stock.
The Fund is a non-diversified fund, which means that the Fund may take
larger positions in a small number of companies than a diversified fund.
The Fund's sell discipline evolves around three basic strategies. A
stock may be sold if (a) the advisor feels that expected earnings are already
reflected in the share price, (b) the advisor feels that the stock's
fundamentals no longer meet the advisor's criteria, or (c) the advisor needs to
increase the overall cash level of the Fund.
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 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.
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 NON-DIVERSIFICATION RISK. As a non-diversified fund, the Fund's portfolio
may at times focus on a limited number of companies and will be subject to
substantially more investment risk and potential for volatility than a
diversified fund.
o FOREIGN RISK. To the extent the Fund invests in ADRs, the Fund could be
subject to greater risks because the Fund's performance may depend on
issues other than the performance of a particular company. Changes in
foreign economies and political climates are more likely to affect the Fund
than a mutual fund that invests exclusively in U.S. companies. The value of
foreign securities is also affected by the value of the local currency
relative to the U.S. dollar. There may also be less government supervision
of foreign markets, resulting in non-uniform accounting practices and less
publicly available information.
o An investment in the Fund is not a deposit of any bank and is not insured
or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.
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.
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GENERAL
The investment objective of the Fund may be changed without shareholder
approval.
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 a fund with a growth investment strategy
o Investors willing to accept price fluctuations in their investment
o Investors who can tolerate the greater risks associated with common stock
investments
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.
FEES AND EXPENSES 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)
Maximum Sales Charge (Load) Imposed on Purchases ...........................NONE
Maximum Deferred Sales Charge (Load)........................................NONE
Redemption Fee..............................................................NONE
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund assets)
Management Fees............................................................1.20%
Distribution (12b-1) Fees...................................................NONE
Other Expenses.............................................................0.05%
TOTAL ANNUAL FUND OPERATING EXPENSES.......................................1.25%
Expense Reimbursement1 ....................................................0.05%
NET EXPENSES ..............................................................1.20%
1 The Fund's advisor has contractual agreed to reimburse the Fund for Trustee
fees and expenses through October 31, 2004.
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Example:
The example below is intended to help you compare the cost of investing
in the Fund with the cost of investing in other mutual funds. The example uses
the same assumptions as other mutual fund prospectuses: a $10,000 initial
investment for the time periods indicated, reinvestment of dividends and
distributions, 5% annual total return, constant operating expenses, and sale of
all shares at the end of each time period. Although your actual expenses may be
different, based on these assumptions your costs will be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$123 $383 $663 $1,518
HOW TO BUY SHARES
The minimum initial investment in the Fund is $200,000 and minimum
subsequent investments are $20,000. 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. The investment minimums may be waived for clients of the
Fund's advisor. 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- To be in proper form, your initial purchase request must
include: o a completed and signed investment application form (which accompanies
this Prospectus); and o a check (subject to the minimum amounts) made payable to
the Fund.
Mail the application and check to:
U.S. Mail: Overnight:
GJMB Growth Fund GJMB Growth 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
(888)-912-4562 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:
Firstar Bank, N.A.
ABA #0420-0001-3
Attn: GJMB Growth Fund
Account Name _________________(write in shareholder name) For the
Account # ______________(write in account number) D.D.A.# 488922436
You must mail a signed application to Firstar 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 GJMB Growth Fund
Checks should be sent to the GJMB Growth Fund at the address listed above. A
bank wire should be sent as outlined above.
TAX SHELTERED RETIREMENT PLANS
Since the Fund is oriented to longer-term investments, the Fund may be
an appropriate investment for tax-sheltered retirement plans, including:
individual retirement plans (IRAs); simplified employee pensions (SEPs); 401(k)
plans; qualified corporate pension and profit-sharing plans (for employees); tax
deferred investment plans (for employees of public school systems and certain
types of charitable organizations); and other qualified retirement plans. You
should contact the 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
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.
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:
U.S. Mail: Overnight:
GJMB Growth Fund GJMB Growth Fund
c/o Unified Fund Services, Inc. c/o Unified Fund Services, Inc.
P.O. Box 6110 431 N. Pennsylvania St.
Indianapolis, IN 46206-6110 Indianapolis, IN 46204
Requests to sell shares are processed at the net asset value next
calculated after we receive your order in proper form. To be in proper form,
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 (888)-912-4562. 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
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 (888)-912-4562.
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 the right 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 $200,000 due to redemption, or such other minimum amount as the Fund may
determine from time to time. An involuntary redemption constitutes a sale. You
should consult your tax 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.
DETERMINATION OF NET ASSET VALUE
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 by the Fund's
advisor at their fair value, according to procedures approved by the Fund's
board of trustees.
Requests to purchase and sell shares are processed at the NAV next
calculated after we receive your order in proper form.
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. 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 capital gains.
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.
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
The Fund's investment advisor is Gamble, Jones Morphy & Bent, 301 East
Colorado Boulevard, Suite 802, Pasadena, California 91101. The advisor is
responsible for the selection and on-going monitoring of the securities in the
Fund's investment portfolio and managing the Funds' business affairs. The firm
became a registered investment adviser in 1956 and was reorganized as a
California corporation in 1990. As of June 30, 1999, the firm manages over $1.3
billion for individuals, trusts and pension plans. The investment decisions for
the Fund are made by the executive committee of the advisor, which is primarily
responsible for the day-to-day management of the Fund's portfolio.
During the fiscal year ended June 30, 1999, the Fund paid the advisor a
fee equal to 1.20% of its average daily net assets.
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 its computer systems.
The Fund's administrator has obtained reasonable assurances from each of the
Funds' major service providers that they have taken comparable steps with
respect to the computer systems used to service the Fund. 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.
FINANCIAL HIGHLIGHTS FOR THE PERIOD DECEMBER 31, 1998
(COMMENCEMENT OF OPERATIONS) TO JUNE 30, 1999
SELECTED PER SHARE DATA
Net asset value, beginning of period $ 10.00
---------------
Income from investment operations
Net investment income 0.02
Net realized and unrealized gain 1.00
---------------
Total from investment operations 1.02
---------------
Net asset value, end of period $ 11.02
===============
TOTAL RETURN (b) 10.20%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000) $6,502
Ratio of expenses to average net assets 1.20% (a)
Ratio of expenses to average net assets
before reimbursement 1.25% (a)
Ratio of net investment income to
average net assets 0.34% (a)
Ratio of net investment income to
average net assets before reimbursement 0.28% (a)
Portfolio turnover rate 24.26% (a)
(a) Annualized
(b) For periods of less than a full year, total returns are not annualized.
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FOR MORE INFORMATION
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. Annual
and semi-annual 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 888-912-4562 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
STATEMENT OF ADDITIONAL INFORMATION
November 1, 1999
This Statement of Additional Information ("SAI") is not a prospectus.
It should be read in conjunction with the Prospectus of GJMB Growth Fund dated
November 1, 1999. This SAI incorporates by reference the Fund's Annual Report to
Shareholders for the fiscal year ended June 30, 1999 ("Annual Report"). A free
copy of the Prospectus or Annual Report can be obtained by writing the Transfer
Agent at Unified Fund Services, Inc., 431 North Pennsylvania Street,
Indianapolis, Indiana 46204, or by calling (888) 912-4562.
TABLE OF CONTENTS
PAGE
DESCRIPTION OF THE TRUST AND FUND 1
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK CONSIDERATIONS .........1
INVESTMENT LIMITATIONS.........................................................2
THE INVESTMENT ADVISOR.........................................................3
TRUSTEES AND OFFICERS..........................................................4
PORTFOLIO TRANSACTIONS AND BROKERAGE...........................................5
DETERMINATION OF SHARE PRICE...................................................5
INVESTMENT PERFORMANCE.........................................................6
CUSTODIAN .............................................................6
TRANSFER AGENT .............................................................6
ACCOUNTANTS .............................................................7
DISTRIBUTOR .............................................................7
ADMINISTRATOR .............................................................7
FINANCIAL STATEMENTS...........................................................7
5957 9/1/99
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DESCRIPTION OF THE TRUST AND FUND
GJMB Growth Fund (the "Fund") was organized as a [non-diversified]
series of AmeriPrime Funds (the "Trust") on October 22, 1998 and commenced
operations on December 31, 1998. 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.
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.
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.
As of October 1, 1999, the following persons may be deemed to
beneficially own five percent (5%) or more of the Fund: Charles Schwab & Co.
("Schwab"), 101 Montgomery Street, San Francisco, CA was the record owner of
74.26% of the Fund. As a result, Schwab may be deemed to control the Fund. The
Schwab accounts are omnibus accounts, and the Fund is unaware of any individual
investor owning 5% or more of the Fund.
As of October 1, 1999, the officers and Trustees as a group
beneficially owned less than 1% of the Fund.
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 "Price of Shares" in the Fund's Prospectus.
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK CONSIDERATIONS
This section contains additional information about the investments the
Fund may make and some of the techniques it may use.
EQUITY SECURITIES
Equity securities consist of common stock, preferred stock, and common
stock equivalents (such as convertible preferred stock and convertible
debentures, rights, and warrants) and investment companies which invest
primarily in the above. Convertible preferred stock is preferred stock that can
be converted into common stock pursuant to its terms. Convertible debentures are
debt instruments that can be converted into common stock pursuant to their
terms. The Fund will not invest more than 5% of its net assets at the time of
purchase in rights, warrants or convertible stock. Equity securities also
include common stocks and common stock equivalents of domestic real estate
investment trusts and other companies which operate as real estate corporations
or which have a significant portion of their assets in real estate. The Fund
will not acquire any direct ownership of real estate. The Fund may invest up to
5% of its net assets in each of the following: convertible preferred stock,
rights and warrants. The Fund will only invest in those convertible preferred
stocks rated A or better by Moodys Investors Services, Inc. or Standard & Poor's
Corporation or, if unrated, of comparable quality in the opinion of the Advisor.
Equity securities also include SPDRs (known as "Spiders"). These are
Standard & Poor's Depositary Receipts based on the S&P 500 or S&P 400 Composite
Stock Price Index or the NASDAQ 100 Price Index (NDX). The SPDR Trust is a unit
investment trust that holds shares of all the companies in the S&P 500, 400, or
NDX and closely tracks the price performance and dividend yield of the
applicable Index. SPDRs trade on the American Stock Exchange under the ticker
symbol "SPY", "MDY", and "QQQ." Equities also include instruments similar to
SPDRs such as DIAMONDS (shares of a unit investment trust that invests in the
Dow Jones Industrial Average.)
AMERICAN DEPOSITARY RECEIPTS
The Fund may invest up to 15% of its assets in American Depositary
Receipts ("ADRs"). An ADR is a certificate evidencing ownership of shares of a
foreign-based issuer held in trust by a bank or similar financial institution.
They are alternatives to the direct purchase of the underlying securities in
their national markets and currencies. To the extent that the Fund does invest
in foreign securities, such investments may be subject to special risks. For
example, there may be less information publicly available about a foreign
company than about a U.S. company, and foreign companies are not generally
subject to accounting, auditing and financial reporting standards and practices
comparable to those in the U.S. Other risks associated with investments in
foreign securities include changes in restrictions on foreign currency
transactions and rates of exchanges, changes in the administrations or economic
and monetary policies of foreign governments, the imposition of exchange control
regulations, the possibility of expropriation decrees and other adverse foreign
governmental action, the imposition of foreign taxes, less liquid markets, less
government supervision of exchanges, brokers and issuers, difficulty in
enforcing contractual obligations, delays in settlement of securities
transactions and greater price volatility. In addition, investing in foreign
securities will generally result in higher commissions than investing in similar
domestic securities.
INVESTMENT LIMITATIONS
Fundamental. The investment limitations described below have been
adopted by the Trust with respect to the Fund and are fundamental
("Fundamental"), i.e., they may not be changed without the affirmative vote of a
majority of the outstanding shares of the Fund. As used in the Prospectus and
the Statement of Additional Information, the term "majority" of the outstanding
shares of the Fund means the lesser of (1) 67% or more of the outstanding shares
of the Fund present at a meeting, if the holders of more than 50% of the
outstanding shares of the Fund are present or represented at such meeting; or
(2) more than 50% of the outstanding shares of the Fund. Other investment
practices which may be changed by the Board 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 non-publicly 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).
i. Pledging. The Fund will not mortgage, pledge, hypothecate or in any
manner transfer, as security for indebtedness, any assets of the Fund except as
may be necessary in connection with borrowings described in limitation (1)
above. Margin deposits, security interests, liens and collateral arrangements
with respect to transactions involving options, futures contracts, short sales
and other permitted investments and techniques are not deemed to be a mortgage,
pledge or hypothecation of assets for purposes of this limitation.
ii. Borrowing. The Fund will not engage in borrowing (including reverse
repurchase agreements).
iii. Margin Purchases. The Fund will not purchase securities or
evidences of interest thereon on "margin." This limitation is not applicable to
short term credit obtained by the Fund for the clearance of purchases and sales
or redemption of securities, or to arrangements with respect to transactions
involving options, futures contracts, short sales and other permitted
investments and techniques.
iv. Short Sales. The Fund will not effect short sales of securities.
v. Options. The Fund will not purchase or sell puts, calls, options or
straddles, except as described in the Prospectus and the Statement of Additional
Information.
THE INVESTMENT ADVISOR
The Fund's investment adviser is Gamble, Jones Morphy & Bent, 301 East
Colorado Boulevard, Suite 802, Pasadena, California 91101. The Advisor is a
corporation organized in the state of California in 1990, and is the business
successor to a firm registered as an investment advisor since 1956. Thomas S.
Jones, President, and Thomas W. Bent, Executive Vice-President of the Advisor,
own a majority of the Advisor's shares and may be deemed to have controlling
interests.
Under the terms of the management agreement (the "Agreement"), the
Advisor manages the Fund's investments subject to approval of the Board of
Trustees and pays all of the expenses of the Fund except brokerage, taxes,
interest, fees and expenses of the non-interested person trustees and
extraordinary expenses. As compensation for its management services and
agreement to pay the Fund's expenses, the Fund is obligated to pay the Advisor a
fee computed and accrued daily and paid monthly at an annual rate of 1.20% of
the average daily net assets of the Fund. The Advisor may waive all or part of
its fee, at any time, and at its sole discretion, but such action shall not
obligate the Advisor to waive any fees in the future. For the period December
31, 1998 (commencement of operations) through June 30, 1999, the Fund paid
advisory fees of $23,899.
The Advisor retains the right to use the name "GJMB" 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 "GJMB" automatically
ceases ninety days after termination of the Agreement and may be withdrawn by
the Advisor on ninety days written notice.
The Advisor may make payments to banks or other financial institutions
that provide shareholder services and administer shareholder accounts. The
Glass-Steagall Act prohibits banks from engaging in the business of
underwriting, selling or distributing securities. Although the scope of this
prohibition under the Glass-Steagall Act has not been clearly defined by the
courts or appropriate regulatory agencies, management of the Fund believes that
the Glass-Steagall Act should not preclude a bank from providing such services.
However, state securities laws on this issue may differ from the interpretations
of federal law expressed herein and banks and financial institutions may be
required to register as dealers pursuant to state law. If a bank were prohibited
from continuing to perform all or a part of such services, management of the
Fund believes that there would be no material impact on the Fund or its
shareholders. Banks may charge their customers fees for offering these services
to the extent permitted by applicable regulatory authorities, and the overall
return to those shareholders availing themselves of the bank services will be
lower than to those shareholders who do not. The Fund may from time to time
purchase securities issued by banks which provide such services; however, in
selecting investments for the Fund, no preference will be shown for such
securities.
TRUSTEES AND OFFICERS
The 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 Secretary and Treasurer of AmeriPrime Advisors Trust and AmeriPrime
Suite 200 Insurance Trust; various positions with Fidelity Investments from
Southlake, Texas 76092 1987 to 1998; most recently Fund Reporting Unit Manager.
==================================== ---------------- ======================================================================
Steve L. Cobb Trustee President of Chandler Engineering Company, L.L.C., oil and gas
Age: 41 services company; various positions with Carbo Ceramics, Inc., oil
2001 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 June 30, 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.
<PAGE>
<TABLE>
<S> <C> <C>
==================================== ----------------------- ==================================
AGGREGATE TOTAL COMPENSATION
NAME COMPENSATION FROM TRUST (THE TRUST IS
FROM TRUST NOT IN A FUND COMPLEX)
==================================== ----------------------- ==================================
Kenneth D. Trumpfheller 0 0
==================================== ----------------------- ==================================
Steve L. Cobb $11,029 $11,029
==================================== ======================= ==================================
Gary E. Hippenstiel $11,029 $11,029
==================================== ======================= ==================================
</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.
The Advisor's clients (other than the Trust) generally select the
broker for execution of trades on their behalf. As a result, it is unlikely that
the Advisor's clients would use the same broker to purchase or sell the same
security on the same day. In the event that more than one client wants to
purchase or sell the same security on a given date through the same broker, the
purchases and sales will normally be made by random client selection. For the
period December 31, 1998 (commencement of operations) through June 30, 1999, the
Fund paid brokerage commissions of $10,886.
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 "The Price of Shares"
in the Prospectus.
INVESTMENT PERFORMANCE
Each 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
(over the one and five year periods and the period from initial public offering
through the end of the Fund's most recent fiscal year) that would equate the
initial amount invested to the ending redeemable value, according to the
following formula:
P(1+T)n=ERV
Where: P = a hypothetical $1,000 initial investment
T = average annual total return
n = number of years
ERV = ending redeemable value at the end of the
applicable period of the hypothetical $1,000
investment made at the beginning of the
applicable period.
The computation assumes that all dividends and distributions are
reinvested at the net asset value on the reinvestment dates and that a complete
redemption occurs at the end of the applicable period.
The Fund's investment performance will vary depending upon market
conditions, the composition of the Fund's portfolio and operating expenses of
the Fund. These factors and possible differences in the methods and time periods
used in calculating non-standardized investment performance should be considered
when comparing the Fund's performance to those of other investment companies or
investment vehicles. The risks associated with the Fund's investment objective,
policies and techniques should also be considered. At any time in the future,
investment performance may be higher or lower than past performance, and there
can be no assurance that any performance will continue. For the period December
31, 1998 (commencement of operations) through June 30, 1999 the Fund's total
return was 10.20%.
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.
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
Firstar Bank, N.A., 425 Walnut Street, Cincinnati, Ohio 45202, is
Custodian of the Fund's investments. The Custodian acts as the Fund's
depository, safekeeps its portfolio securities, collects all income and other
payments with respect thereto, disburses funds at the Fund's request and
maintains records in connection with its duties.
TRANSFER AGENT
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 December 31, 1998 (commencement
of operations) through June 30, 1999, Unified received $12,576 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 June 30, 2000. McCurdy & Associates performs an annual
audit of the Funds' 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 December 31, 1998 (commencement of operations)
through June 30, 1999, the Administrator received $15,000 from the Advisor (not
the Fund) for these services.
FINANCIAL STATEMENTS
The financial statements and independent auditor's report required to
be included in the statement of additional information are incorporated herein
by reference to the Fund's Annual Report to the shareholders for the period
ended June 30, 1999. The Trust will provide the Annual Report without charge by
calling the Fund at (888)-912-4562.
<PAGE>
