GLOBALT GROWTH FUND
STATEMENT OF ADDITIONAL INFORMATION
August 10, 2000
This Statement of Additional Information ("SAI") is not a prospectus. It
should be read in conjunction with the Prospectus of GLOBALT Growth Fund dated
January 31, 2000. This SAI incorporates by reference to the Trust's Annual
Report to Shareholders for the fiscal year ended October 31, 1999 ("Annual
Report"). A free copy of the Prospectus or Annual Report can be obtained by
writing the Transfer Agent at 431 N. Pennsylvania St., Indianapolis, IN 46204,
or by calling 1-877-BUY-GROWX (877-289-4769).
TABLE OF CONTENTS
PAGE
DESCRIPTION OF THE TRUST AND FUND............................................1
ADDITIONAL INFORMATION ABOUT FUND
INVESTMENTS AND RISK CONSIDERATIONS..........................................2
INVESTMENT LIMITATIONS.......................................................4
THE INVESTMENT ADVISER.......................................................6
TRUSTEES AND OFFICERS........................................................8
PORTFOLIO TRANSACTIONS AND BROKERAGE.........................................9
DETERMINATION OF SHARE PRICE................................................10
INVESTMENT PERFORMANCE......................................................10
CUSTODIAN...................................................................11
TRANSFER AGENT..............................................................12
ACCOUNTANTS.................................................................12
DISTRIBUTOR.................................................................12
ADMINISTRATOR...............................................................12
FINANCIAL STATEMENTS........................................................13
<PAGE>
DESCRIPTION OF THE TRUST AND FUND
......GLOBALT Growth Fund (the "Fund") was organized as a diversified series of
AmeriPrime Funds (the "Trust") on October 20, 1995. 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 shareholders. 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 December 31, 1999, the following persons may be deemed to
beneficially own five percent (5%) or more of the Fund: Glidden Treasurer, 3400
Peachtree Road, NE, Suite 1735, Atlanta, GA 30326, 9.45%, Charles Schwab & Co.
("Schwab"), 101 Montgomery Street, San Francisco, CA, 6.36% of the Fund.
As of December 31, 1999, the officers and trustees as a group may be
deemed to beneficially own less than one percent (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 and this Statement of Additional Information.
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK CONSIDERATIONS
This section contains a more detailed discussion of some of the
investments the Fund may make and some of the techniques it may use, as
described in the Prospectus (see "Investment Objectives and Strategies" and
"Investment Policies and Techniques and Risk Considerations").
A. Equity Securities. Equity securities include common stock, preferred
stock and common stock equivalents (such as convertible preferred stock, rights
and warrants). Convertible preferred stock is preferred stock that can be
converted into common stock pursuant to its terms. Warrants are options to
purchase equity securities at a specified price valid for a specific time
period. Rights are similar to warrants, but normally have a short duration and
are distributed by the issuer to its shareholders. The Fund may invest up to 5%
of its net assets at the time of purchase in each of the following: rights,
warrants, or convertible preferred stocks.
B. Repurchase Agreements. A repurchase agreement is a short-term
investment in which the purchaser (i.e., the Fund) acquires ownership of a U.S.
Government obligation (which may be of any maturity) and the seller agrees to
repurchase the obligation at a future time at a set price, thereby determining
the yield during the purchaser's holding period (usually not more than seven
days from the date of purchase). Any repurchase transaction in which the Fund
engages will require full collateralization of the seller's obligation during
the entire term of the repurchase agreement. In the event of a bankruptcy or
other default of the seller, the Fund could experience both delays in
liquidating the underlying security and losses in value. However, the Fund
intends to enter into repurchase agreements only with the Custodian, other banks
with assets of $1 billion or more and registered securities dealers determined
by the Adviser (subject to review by the Board of Trustees) to be creditworthy.
The Adviser monitors the creditworthiness of the banks and securities dealers
with which the Fund engages in repurchase transactions, and the Fund will not
invest more than 5% of its net assets in repurchase agreements.
C. Other Investment Companies. The Fund is permitted to invest in other
investment companies at any time. The Fund will not purchase more than 3% of the
outstanding voting stock of any investment company. If the Fund acquires
securities of another investment company, the shareholders of the Fund will be
subject to duplicative management fees.
D. Fixed Income Securities. The Fund may temporarily invest in short term
fixed income securities. The Fund will limit its investment in fixed income
securities to corporate debt securities and U.S. government securities. Fixed
income securities are generally considered to be interest rate sensitive, which
means that their value will generally decrease when interest rates rise and
increase when interest rates fall. Securities with shorter maturities, while
offering lower yields, generally provide greater price stability than longer
term securities and are less affected by changes in interest rates.
E. Financial Services Industry Obligations. The Fund may invest up to 5%
of its net assets in each of the following obligations of the financial services
industry:
(1) Certificate of Deposit. Certificates of deposit are negotiable
certificates evidencing the indebtedness of a commercial bank or a savings
and loan association to repay funds deposited with it for a definite
period of time (usually from fourteen days to one year) at a stated or
variable interest rate.
(2) Time Deposits. Time deposits are non-negotiable deposits maintained in
a banking institution or a savings and loan association for a specified period
of time at a stated interest rate.
(3) Bankers' Acceptances. Bankers' acceptances are credit
instruments evidencing the obligation of a bank to pay a draft which has
been drawn on it by a customer, which instruments reflect the obligation
both of the bank and of the drawer to pay the face amount of the
instrument upon maturity.
F. Option Transactions. The Fund may engage in option transactions
involving individual securities and market indices. An option involves either
(a) the right or the obligation to buy or sell a specific instrument at a
specific price until the expiration date of the option, or (b) the right to
receive payments or the obligation to make payments representing the difference
between the closing price of a market index and the exercise price of the option
expressed in dollars times a specified multiple until the expiration date of the
option. Options are sold (written) on securities and market indices. The
purchaser of an option on a security pays the seller (the writer) a premium for
the right granted but is not obligated to buy or sell the underlying security.
The purchaser of an option on a market index pays the seller a premium for the
right granted, and in return the seller of such an option is obligated to make
the payment. A writer of an option may terminate the obligation prior to
expiration of the option by making an offsetting purchase of an identical
option. Options are traded on organized exchanges and in the over-the-counter
market. Options on securities which the Fund sells (writes) will be covered or
secured, which means that it will own the underlying security (for a call
option); will segregate with the Custodian high quality liquid debt obligations
equal to the option exercise price (for a put option); or (for an option on a
stock index) will hold a portfolio of securities substantially replicating the
movement of the index (or, to the extent it does not hold such a portfolio, will
maintain a segregated account with the Custodian of high quality liquid debt
obligations equal to the market value of the option, marked to market daily).
When the Fund writes options, it may be required to maintain a margin account,
to pledge the underlying securities or U.S. government obligations or to deposit
liquid high quality debt obligations in a separate account with the Custodian.
The purchase and writing of options involves certain risks; for example,
the possible inability to effect closing transactions at favorable prices and an
appreciation limit on the securities set aside for settlement, as well as (in
the case of options on a stock index) exposure to an indeterminate liability.
The purchase of options limits the Fund's potential loss to the amount of the
premium paid and can afford the Fund the opportunity to profit from favorable
movements in the price of an underlying security to a greater extent than if
transactions were effected in the security directly. However, the purchase of an
option could result in the Fund losing a greater percentage of its investment
than if the transaction were effected directly. When the Fund writes a covered
call option, it will receive a premium, but it will give up the opportunity to
profit from a price increase in the underlying security above the exercise price
as long as its obligation as a writer continues, and it will retain the risk of
loss should the price of the security decline. When the Fund writes a covered
put option, it will receive a premium, but it will assume the risk of loss
should the price of the underlying security fall below the exercise price. When
the Fund writes a covered put option on a stock index, it will assume the risk
that the price of the index will fall below the exercise price, in which case
the Fund may be required to enter into a closing transaction at a loss. An
analogous risk would apply if the Fund writes a call option on a stock index and
the price of the index rises above the exercise price.
G. Loans of Portfolio Securities. The Fund may make short and long term
loans of its portfolio securities. Under the lending policy authorized by the
Board of Trustees and implemented by the Adviser in response to requests of
broker-dealers or institutional investors which the Adviser deems qualified, the
borrower must agree to maintain collateral, in the form of cash or U.S.
government obligations, with the Fund on a daily mark-to-market basis in an
amount at least equal to 100% of the value of the loaned securities. The Fund
will continue to receive dividends or interest on the loaned securities and may
terminate such loans at any time or reacquire securities in time to vote on any
matter which the Board of Trustees determines to be serious. With respect to
loans of securities, there is the risk that the borrower may fail to return the
loaned securities or that the borrower may not be able to provide additional
collateral.
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 (a) 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 and (b)
as described in the Prospectus and the Statement of Additional Information.
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 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).
i. Pledging. The Fund will not mortgage, pledge, hypothecate or in any
manner transfer, as security for indebtedness, any assets of the Fund except as
may be necessary in connection with borrowings described in limitation (1)
above. Margin deposits, security interests, liens and collateral arrangements
with respect to transactions involving options, futures contracts, short sales
and other permitted investments and techniques are not deemed to be a mortgage,
pledge or hypothecation of assets for purposes of this limitation.
ii. Borrowing. The Fund will not purchase any security while borrowings
(including reverse repurchase agreements) representing more than 5% of its total
assets are outstanding. The Fund will not enter into reverse repurchase
agreements.
iii. Margin Purchases. The Fund will not purchase securities or evidences
of interest thereon on "margin." This limitation is not applicable to short term
credit obtained by the Fund for the clearance of purchases and sales or
redemption of securities, or to arrangements with respect to transactions
involving options, futures contracts, short sales and other permitted
investments and techniques.
iv. Short Sales. The Fund will not effect short sales of securities unless
it owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short.
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.
vi. Repurchase Agreements. The Fund will not invest more than 5% of its
net assets in repurchase agreements.
vii. Illiquid Investments. The Fund will not invest in securities for
which there are legal or contractual restrictions on resale and other illiquid
securities.
THE INVESTMENT ADVISER
The Fund's investment adviser is GLOBALT, Inc., 3060 Peachtree Road, N.W.,
One Buckhead Plaza, Suite 225, Atlanta, Georgia 30305. Samuel Allen may be
deemed to be a controlling person of the Adviser due to his ownership of its
shares and his position as Chief Executive Officer.
Under the terms of the management agreement (the "Agreement"), the Adviser
manages the Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of the Fund (including organizational expenses) 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
Adviser a fee computed and accrued daily and paid monthly at an annual rate of
1.17% of the average daily net assets of the Fund. The Adviser may waive all or
part of its fee, at any time, and at its sole discretion, but such action shall
not obligate the Adviser to waive any fees in the future. For the fiscal years
ended October 31, 1997 and 1998 and 1999 the Fund paid advisory fees of $62,923,
$122,484 and $183,642 respectively.
The Adviser retains the right to use the name "GLOBALT" in connection with
another investment company or business enterprise with which the Adviser is or
may become associated. The Trust's right to use the name "GLOBALT" automatically
ceases ninety days after termination of the Agreement and may be withdrawn by
the Adviser on ninety days written notice.
The Advisor may make payments to banks or other financial institutions
that provide shareholder services and administer shareholder accounts. If a bank
or other financial institution 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 and other financial
institutions 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 and other financial institutions which provide such
services; however, in selecting investments for the Fund, no preference will be
shown for such securities.
<PAGE>
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>
<CAPTION>
=====================================================================================
NAME, AGE AND ADDRESS POSITION PRINCIPAL OCCUPATIONS DURING PAST 5
YEARS
-------------------------------------------------------------------------------------
<S> <C> <C>
* Kenneth D. Trumpfheller President, President and Secretary of AmeriPrime
Age: 41 Secretary and Financial Services, Inc., the Fund's
1793 Kingswood Drive Trustee administrator, and AmeriPrime Financial
Suite 200 Securities, Inc., the Fund's
Southlake, Texas 76092 distributor, since 1994. Prior to
December, 1994, a senior client
executive with SEI Financial
Services.
-------------------------------------------------------------------------------------
*Robert A. Chopyak Treasurer and Manager of AmeriPrime Financial
1793 Kingswood Drive Chief Financial Services, Inc., the Fund's
Suite 200 Officer administrator, from February 2000 to
Southlake, Texas 76092 present. Self-employed, performing Y2K
Year of Birth: 1968 testing, January 1999 to January 2000.
Vice President of Fund Accounting,
American Data Services, Inc., a mutual
fund services company, October 1992 to
December 1998.
-------------------------------------------------------------------------------------
Steve L. Cobb Trustee President of Chandler Engineering
Age: 42 Company, L.L.C. oil and gas services
2001 N. Indianwood Avenue company; various positions with Carbo
Broken Arrow, Oklahoma Ceramics, Inc., oil field
74012 manufacturing/supply company, from 1984
to 1997, most recently Vice President
of Marketing.
-------------------------------------------------------------------------------------
Gary E. Hippenstiel Trustee Director, Vice President and Chief
Age: 52 Investment Officer of Legacy Trust
600 Jefferson Street, Company since 1992; President and
Suite 350 Director of Heritage Trust Company from
Houston, TX 77002 1994 to 1996.
=====================================================================================
</TABLE>
The compensation paid to the Trustees of the Trust for the Fund's fiscal
year ended October 31, 1999 is set forth in the following table. Trustee fees
are Trust expenses and each series of the Trust is responsible for a portion of
the Trustee fees. The Adviser voluntarily reimbursed the Fund for the Fund's
share of the Trustee fees paid for the fiscal year ended October 31, 1998.
======================================================
NAME AGGREGATE TOTAL COMPENSATION
COMPENSATION FROM TRUST (THE TRUST
FROM TRUST IS NOT IN A FUND COMPLEX)
------------------------------------------------------
Kenneth D. 0 0
Trumpfheller
------------------------------------------------------
Steve L. Cobb $16,012.00 $16,012.00
------------------------------------------------------
Gary E. Hippenstiel $16,012.00 $16,012.00
======================================================
PORTFOLIO TRANSACTIONS AND BROKERAGE
Subject to policies established by the Board of Trustees of the Trust, the
Adviser is responsible for the Fund's portfolio decisions and the placing of the
Fund's portfolio transactions. In placing portfolio transactions, the Adviser
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 Adviser 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 Adviser 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 Adviser 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 Adviser 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 Adviser'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 Adviser in servicing all of its accounts. Similarly,
research and information provided by brokers or dealers serving other clients
may be useful to the Adviser in connection with its services to the Fund.
Although research services and other information are useful to the Fund and the
Adviser, 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 Adviser
that the review and study of the research and other information will not reduce
the overall cost to the Adviser of performing its duties to the Fund under the
Agreement.
Over-the-counter transactions will be placed either directly with
principal market makers or with broker-dealers, if the same or a better price,
including commissions and executions, is available. Fixed income securities are
normally purchased directly from the issuer, an underwriter or a market maker.
Purchases include a concession paid by the issuer to the underwriter and the
purchase price paid to a market maker may include the spread between the bid and
asked prices.
To the extent that the Fund and another of the Adviser's clients seek to
acquire the same security at about the same time, 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. On the other hand, if the same securities are bought
or sold at the same time by more than one client, the resulting participation in
volume transactions could produce better executions for the Fund. In the event
that more than one client wants to purchase or sell the same security on a given
date, the purchases and sales will normally be made by random client selection.
For the fiscal years ended October 31, 1997, 1998 and 1999, the Fund paid
brokerage commissions of $7,702, $20,472 and $40,441 respectively.
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 Fund 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 Fund 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.
Securities which are traded on any exchange or on the NASDAQ
over-the-counter market are valued at the last quoted sale price. Lacking a last
sale price, a security is valued at its last bid price except when, in the
Fund's adviser's opinion, the last bid price does not accurately reflect the
current value of the security. All other securities for which over-the-counter
market quotations are readily available are valued at their last bid price. When
market quotations are not readily available, when the Fund's adviser determines
the last bid price does not accurately reflect the current value or when
restricted securities are being valued, such securities are valued as determined
in good faith by the Fund's adviser, subject to review of the Board of Trustees
of the Trust.
Fixed income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Fund's adviser believes such prices accurately reflect the fair market value of
such securities. A pricing service utilizes electronic data processing
techniques based on yield spreads relating to securities with similar
characteristics to determine prices for normal institutional-size trading units
of debt securities without regard to sale or bid prices. When prices are not
readily available from a pricing service, or when restricted or illiquid
securities are being valued, securities are valued at fair value as determined
in good faith by the Fund's adviser, subject to review of the Board of Trustees.
Short term investments in fixed income securities with maturities of less than
60 days when acquired, or which subsequently are within 60 days of maturity, are
valued by using the amortized cost method of valuation, which the Board has
determined will represent fair value.
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
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.
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
1, 1995 (commencement of operations) through October 31, 1999 and for the fiscal
year ended October 31, 1999, the Fund's average annual total return was 23.35%
and 26.67%, respectively.
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
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.
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TRANSFER AGENT
As of July 1, 1998, Unified Fund Services, Inc., 431 N. Pennsylvania St.,
Indianapolis, IN 46204 ("Unified"), acts as the Fund's transfer agent and, in
such capacity, maintains the records of each shareholder's account, answers
shareholders' inquiries concerning their accounts, processes purchases and
redemptions of the Fund's shares, acts as dividend and distribution disbursing
agent and performs other shareholder service functions. For its services as
transfer agent, Unified receives a monthly fee from the Advisor of $1.20 per
shareholder (subject to a minimum monthly fee of $750). 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, and 0.0250% of the Fund's
assets from $100 million to $300 million, and 0.0200% of the Fund's assets over
$300 million (subject to various monthly minimum fees, the maximum being $2,000
per month for assets of $20 to $100 million). For the fiscal year ended October
31, 1999, Unified received $19,314, from the Adviser (not the Fund) for these
fund accounting services. Unified began providing accounting services to the
Fund on November 1, 1998.
ACCOUNTANTS
The firm of McCurdy & Associates CPA's, Inc., 27955 Clemens Road,
Westlake, Ohio 44145, has been selected as independent public accountants for
the Fund for the fiscal year ending October 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. (the "Distributor"), 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. The Administrator receives a monthly fee from the Advisor equal to
an annual rate of 0.10% of the Fund's assets under $50 million, 0.075% of the
Fund's assets from $50 million to $100 million, and 0.050% of the Fund's assets
over $100 million (subject to a minimum fee of $2,500 per month). The
Administrator, the Distributor, and Unified (the Fund's transfer agent) are
controlled by Unified Financial Services, Inc. For the fiscal years ended
October 31, 1997, 1998, and 1999 the Administrator received $30,000, for each
year from the Adviser (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 Trust's Annual Report to Shareholders for the fiscal year ended
October 31, 1999. The Trust will provide the Annual Report without charge by
calling the Fund at 1-877-289-4769.