<PAGE> 1
Registration Nos. 33-35190 and 811-6114
As filed with the Securities and Exchange Commission on December 4, 1998
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Post-Effective Amendment No. 19 [X]
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 [X]
Amendment No. 17
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AMERICAN PERFORMANCE FUNDS
--------------------------
(Exact Name of Registrant as Specified in Charter)
3435 Stelzer Road, Columbus, Ohio 43219
---------------------------------------
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code:
800-762-7085
------------
Joel Engle, Treasurer
American Performance Funds
3435 Stelzer Road, Columbus, Ohio 43219
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(Name and Address of Agent for Service)
COPIES OF COMMUNICATIONS TO:
Martin E. Lybecker, Esquire
Ropes & Gray
1301 K Street, N.W., Washington, D.C. 20005
APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: CONTINUOUS
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It is proposed that this filing become effective (check appropriate box)
[ ] Immediately upon filing pursuant to paragraph (b)
[ ] On [Date] pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] On (date) pursuant to paragraph (a)(1)
[ X ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date) pursuant to paragraph (a)(2) of Rule 485
[ ] this post-effective amendment designates a new effective date
for a previously filed post-effective amendment
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TITLE OF SECURITIES BEING REGISTERED: SHARES OF BENEFICIAL INTEREST
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<PAGE> 2
<TABLE>
<CAPTION>
CROSS REFERENCE SHEET
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PROSPECTUS FOR AMERICAN PERFORMANCE SMALL CAP EQUITY FUND
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Form N-1A Part A Item Prospectus Caption
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<S> <C> <C>
1. Cover Page Cover Page
2. Synopsis Fee Table
3. Condensed Financial Information General Information - Performance
Information
4. General Description Cover Page;
of Registrant Investment Objectives; Investment
Policies and Special Considerations;
Investment Restrictions; General
Information - Description of the
Funds and their Shares
5. Management of the Fund Management of the Fund
5A. Management's Discussion of Fund Performance See the Registrant's Current
Annual Report
6. Capital Stock and How to Purchase
Other Securities Shares; How to Redeem Shares;
Sales Charges; Dividends; Federal
Income Taxes; General Information -
Description of the Funds and their
Shares; General Information
-Miscellaneous
7. Purchase of Securities Valuation of Shares; How
Being Offered to Purchase Shares
8. Redemption or Repurchase How to Redeem Shares
9. Pending Legal Proceedings Inapplicable
</TABLE>
<PAGE> 3
PROSPECTUS
AMERICAN PERFORMANCE SMALL CAP EQUITY FUND
A VARIABLE NET ASSET VALUE INVESTMENT PORTFOLIO OF
AMERICAN PERFORMANCE FUNDS
3435 Stelzer Road
Columbus, Ohio 43219
For performance, purchase, and redemption information,
call (800) 762-7085
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The American Performance Small Cap Equity Fund (the "Small Cap Equity
Fund" or the "Fund") is a variable net asset value portfolio of the AMERICAN
PERFORMANCE FUNDS (the "Funds"), a diversified, open-end management investment
company which currently consists of eleven separately managed portfolios. The
Small Cap Equity Fund seeks long-term capital appreciation and, secondarily,
income, by investing primarily in a diversified portfolio of common stocks and
securities convertible into common stocks of small-size companies. The net asset
value per unit of beneficial interest ("Share") of the Fund may be expected to
fluctuate in accordance with the value of the Fund's portfolio investments.
THE FUND'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR ENDORSED OR
GUARANTEED BY, BANK OF OKLAHOMA, N.A. OR ANY OF ITS AFFILIATES. THE FUND'S
SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION,
THE FEDERAL RESERVE BOARD, OR BY ANY OTHER AGENCY. AN INVESTMENT IN THE FUND
INVOLVES INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is February __, 1999
<PAGE> 4
Bank of Oklahoma, N.A., Tulsa, Oklahoma ("BOK") serves as the
investment adviser ("Investment Adviser") to the Small Cap Equity Fund. BISYS
Fund Services Limited Partnership, d/b/a BISYS Fund Services, Columbus, Ohio,
("BISYS") acts as the Small Cap Equity Fund's Administrator and Distributor.
This Prospectus relates only to the Small Cap Equity Fund. The Funds
also include two money market portfolios to which BOK serves as Investment
Adviser: the American Performance Cash Management Fund (for which AMR Investment
Services, Inc. ("AMR") serves as Investment Sub-Adviser) and the American
Performance U.S. Treasury Fund, each of which seeks current income with
liquidity and stability of principal (collectively, the "American Performance
Money Market Funds"). The Funds also include four bond portfolios to which BOK
serves as Investment Adviser: the American Performance Bond Fund, the American
Performance Intermediate Bond Fund, and the American Performance Short-Term
Income Fund, each of which seeks current income, and the American Performance
Intermediate Tax-Free Bond Fund, which seeks current income exempt from Federal
taxation, through investing in diversified portfolios of bonds and other
fixed-income securities (collectively, the "American Performance Bond Investment
Funds"). The Funds also include four other equity portfolios to which BOK serves
as Investment Adviser: the American Performance Equity Fund, the American
Performance Aggressive Growth Fund, each of which seeks growth of capital and,
secondarily, income through investing primarily in a diversified portfolio of in
common stocks and securities convertible into common stocks, the American
Performance Balanced Fund, which seeks current income and, secondarily,
long-term capital growth by investing primarily in a broadly diversified
portfolio of securities, including common stocks, preferred stocks and bonds,
and the American Performance Growth Equity Fund, which seeks long-term capital
appreciation and growth of income by investing primarily in a diversified
portfolio of common stocks and securities convertible into common stocks
(collectively, the "American Performance Equity Investment Funds"). Persons who
wish to obtain a copy of the Prospectus for the American Performance Money
Market Funds, the American Performance Bond Investment Funds, or the American
Performance Equity Investment Funds may contact the Funds, at the telephone
number shown above.
A Statement of Additional Information bearing the same date as this
Prospectus, has been filed with the Securities and Exchange Commission and is
incorporated herein by reference. The Statement of Additional Information can be
obtained without charge by writing or calling the Fund at the address or
telephone number shown above.
This Prospectus sets forth the information about the Small Cap Equity
Fund that a prospective investor ought to know before investing. Investors
should read this Prospectus and retain it for future reference.
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FEE TABLE
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Small Cap
Equity
Fund
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Shareholder Transaction Expenses(1)
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Maximum Sales Load
Imposed on Purchases(2) 5.00%
(as a percentage of offering price)
Maximum Sales Load Imposed
on Reinvested Dividends 0%
(as a percentage of offering price)
Deferred Sales Load(3) 0%
(as a percentage of original
purchase price or redemption
proceeds, if applicable)
Redemption Fees(4) 0%
(as a percentage of amount
redeemed, if applicable)
Exchange Fees $0
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(1) Participating Organizations (as defined in "DISTRIBUTION") may
charge a Customer's (as defined in "DISTRIBUTION") account fees for automatic
investment and other investment and trust services provided in connection with
an investment in the Fund. (See "HOW TO PURCHASE SHARES.")
(2) There may be no sales load imposed upon purchases of shares of the
Fund by (1) investors who purchase through the Investment Adviser and who have
an existing trust relationship with the Investment Adviser; (2) employees of the
Investment Adviser, or its affiliates; (3) each Trustee of the Funds and any
employee of a company that constitutes the principal business activity of a
Trustee; (4) employees of the Distributor and its affiliates; (5) orders placed
on behalf of other investment companies distributed by The BISYS Group, Inc. or
its affiliated companies; (6) existing Shareholders who own Shares in any of the
Equity Investment Funds within their trust accounts and purchase additional
Shares outside of their trust relationship; (7) investors within wrap accounts;
(8) investors who purchase in connection with 401(k) plans, 403(b) plans, and
other employer-sponsored, qualified retirement plans; and (9) investors who
purchase in connection with non-transactional fee fund programs and programs
offered by fee-based financial planners and other types of financial
institutions.
(3) A Contingent Deferred Sales Load of 1.00% will be assessed against
the proceeds of any redemption request relating to Shares of the Fund that were
purchased without a sales charge in reliance
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<PAGE> 6
upon the waiver accorded to purchases in the amount of $1 million or more, but
only where such redemption request is made within one year of the date the
Shares were purchased.
(4) A wire redemption charge may be deducted from the amount of a wire
redemption payment made at the request of a holder of Shares. The current
charge, which is subject to change upon notice to Shareholders, is $15.00. (See
"HOW TO REDEEM SHARES --By Telephone.")
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Small Cap
Equity
Fund
----
Annual Operating Expenses
- -------------------------
(as a percentage of average net assets)
Management Fees(5) 0.00%
(after voluntary fee reductions)
12b-1 Fees(6) 0.00%
(after voluntary fee reductions with
respect to the Balanced Fund)
Other Expenses(7) 0.56%
-----
Total Fund Operating Expenses(8) 0.56%
(after voluntary fee reductions) =====
- ------------
(5) In order to reduce operating expenses, the Investment Adviser has
voluntarily agreed to reduce the investment advisory fees. Absent a voluntary
fee reduction, the investment advisory fees would be 0.69% of the average daily
net assets of the Small Cap Equity Fund.
(6) In order to reduce operating expenses, the Distributor has
voluntarily agreed to reduce the 12b-1 Fees. Absent a voluntary fee reduction,
the 12b-1 Fee would be 0.25% of the average daily net assets of the Small Cap
Equity Fund.
(7) Other Expenses is based on estimated amounts for the current fiscal
year.
(8) Absent voluntary fee reductions, the Total Fund Operating Expenses
would be 1.50% of the average daily net asset of the Small Cap Equity Fund.
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<PAGE> 8
Example: You would pay the following expenses on a $1,000 investment in the
Fund, assuming (1) 5% annual return and (2) redemption at the end of each time
period:
Small Cap
Equity
Fund
----
1 Year $55
3 Years $67
The purpose of the above table is to assist a potential purchaser of
Shares of the Small Cap Equity Fund in understanding the various costs and
expenses that an investor in the Fund will bear directly or indirectly. The
examples reflect voluntary reductions of investment advisory and/or 12b-1 Fees,
as applicable. Although the Investment Adviser and the Distributor currently
have agreed to these voluntary reductions, they may cease to provide these
reductions, which would have the effect of increasing the projected expenses set
forth above in the examples. Such expenses do not include any fees charged by
BOK or any of its affiliates to its customers' accounts which may have invested
in shares of a Fund. See "MANAGEMENT OF THE SMALL CAP EQUITY FUND," "SALES
CHARGES," and "DISTRIBUTION" for a more complete discussion of the transaction
expenses and annual operating expenses of the Fund. NASD rules generally limit
the amount that a Fund may pay under a Distribution Plan. The Small Cap Equity
Fund would stop accruing payments under the Distribution Plan if, to the extent,
and for as long as, such limit would otherwise be exceeded. Long-term
shareholders may pay more than the equivalent of the maximum front-end sales
charges otherwise permitted by the Rules of the National Association of
Securities Dealers, Inc.
THE FOREGOING EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST
OR FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
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INVESTMENT OBJECTIVES
---------------------
The investment objective of the Small Cap Equity Fund is to seek
long-term capital appreciation and, secondarily, income by investing primarily
in a diversified portfolio of common stocks and securities convertible into
common stocks of small -size companies. The inherent risks of small -size
companies are two-fold: business risk and market risk. Business risk refers to
the possibility that a company may do poorly due to competitive or financial
factors. Market risk refers mainly to the relatively small number of shares
publicly owned as compared to larger companies.
The Small Cap Equity Fund will employ a "quantitative" investment
approach. Under this approach, stocks will be ranked according to their return
characteristics and other quantitative factors. The portfolio will be
constructed to exhibit aggregate investment characteristics similar to those of
the Standard & Poor's Small Cap 600 Index (the "S&P 600 Index"). As of the date
of this Prospectus, the S&P 600 Index statistics were as follows: the smallest
company had a market value of $35 million, the largest company a market value of
$3.2 billion, and the mean market value was $514 million. The Small Cap Equity
Fund will not seek to match or track the performance of the S&P 600 Index, nor
limit investments to stocks in that index.
The securities of smaller, less well-known companies may be more
volatile than those of larger companies. An investment in the Small Cap Equity
Fund may increase or decrease in value.
The investment objective of the Fund may not be changed without a vote
of the holders of a majority of the outstanding Shares of the Fund (as defined
in the Statement of Additional Information). There can be no assurance that the
investment objective of the Fund will be achieved.
Additionally, the Small Cap Equity Fund may engage in certain
investment techniques which may subject the Fund to certain risks (see
"INVESTMENT POLICIES AND SPECIAL CONSIDERATIONS").
INVESTMENT POLICIES AND SPECIAL CONSIDERATIONS
----------------------------------------------
Under normal market conditions, the Small Cap Equity Fund will invest
at least 70% of the value of its respective total assets in common stocks and
securities convertible into common stocks of companies believed by the
Investment Adviser to be characterized by sound management and the ability to
finance expected growth. The Small Cap Equity Fund may also invest up to 30% of
its total assets in preferred stocks, corporate bonds, notes, warrants, and cash
equivalents. Corporate bonds will be rated at the time of purchase within the
three highest ratings categories assigned by a nationally recognized statistical
ratings organization (an "NRSRO") (e.g., at least "A" by Moody's
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<PAGE> 10
Investors Services ("Moody's") or S&P) or, if not rated, found by the Investment
Adviser under guidelines established by the Fund's Board of Trustees to be of
comparable quality.
"Cash equivalents" are deposits or high quality, interest-bearing
instruments with a remaining maturity of one year or less. The purpose of cash
equivalents is to provide liquidity and income at money market rates while
minimizing the risk of decline in value to the maximum extent possible. The
instruments may include, but are not limited to, commercial paper, domestic and
Eurodollar certificates of deposit, repurchase agreements, bankers' acceptances,
U.S. Treasury bills, master demand notes, agency discount notes, bank money
market deposit accounts and money market mutual funds. The Small Cap Equity Fund
will only purchase commercial paper rated at the time of purchase within the
three highest ratings categories assigned by an NRSRO (e.g., A-1 by S&P, Prime-
1 by Moody's or F-1 by Fitch Investors Service) or, if not rated, found by the
Investment Adviser under guidelines established by the Fund's Board of Trustees
to be of comparable quality. See "Appendix" to the Statement of Additional
Information for an explanation of these ratings. During temporary defensive
periods as determined by the Investment Adviser, the Small Cap Equity Fund may
hold up to 100% of its total assets in cash equivalents.
INVESTMENT COMPANY SECURITIES. The Small Cap Equity Fund may invest in shares of
other investment companies, including other American Performance Funds. However,
the Small Cap Equity Fund may not invest more than 5% of its total assets in the
securities of any one investment company, nor may it own more than 3% of the
outstanding securities of any investment company or invest more than 10% of its
total assets in the securities of other investment companies. These investment
companies typically pay an investment advisory fee out of their assets.
Therefore, investments may be subject to duplicate management, advisory and
distribution fees. The Investment Adviser will consider this fee in its
investment analysis when determining whether to purchase shares of these
companies for the Fund. This fee is in addition to the fees received by an the
Fund's Investment Adviser and Administrator. In order to avoid the imposition of
additional fees as a result of investments by the Fund in shares of other
American Performance Funds, the Investment Adviser and Administrator have agreed
to promptly forward to the Small Cap Equity Fund any portion of their usual
asset-based service fees from an American Performance Fund which is attributable
to investment by the Small Cap Equity Fund in shares of such other American
Performance Fund.
OPTIONS AND FUTURES CONTRACTS. The Small Cap Equity Fund may acquire put or call
options and futures contracts and may write covered call options. See the
Statement of Additional Information for more information on these investment
activities.
Futures transactions involve brokerage costs and require the Small Cap
Equity Fund to segregate assets to cover contracts that would require it to
purchase securities. The Small Cap Equity Fund may lose the expected benefit of
futures transactions if interest rates or securities prices
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<PAGE> 11
move in an unanticipated manner. Such unanticipated changes may also result in
poorer overall performance than if the Small Cap Equity Fund had not entered
into any futures transactions. In addition, the value of the Small Cap Equity
Fund's futures positions may not prove to be perfectly or even highly correlated
with the value of its portfolio securities, limiting the Small Cap Equity Fund's
ability to hedge effectively against interest rate and/or market risk and giving
rise to additional risks. There is no assurance of liquidity in the secondary
market for purposes of closing out futures positions.
FOREIGN SECURITIES. The Small Cap Equity Fund may invest in foreign securities
through the purchase of sponsored and unsponsored American Depository Receipts
and may also invest in securities issued by foreign branches of U.S. banks and
foreign banks, in Canadian commercial paper, and in Europaper (U.S.
dollar-denominated commercial paper of a foreign issuer). Investment in foreign
securities is subject to special risks, such as future adverse political and
economic developments, possible seizure, nationalization, or expropriation of
foreign investments, less stringent disclosure requirements, the possible
establishment of exchange controls or taxation at the source, or the adoption of
other foreign governmental restrictions.
SECURITIES LENDING. In order to generate additional income, the Small Cap Equity
Fund may, from time to time, lend its portfolio securities to broker-dealers,
banks, or institutional borrowers of securities. The Fund will enter into loan
agreements only with broker-dealers, banks, or other institutions that BOK has
determined are creditworthy under guidelines established by the Fund's Board of
Trustees. See the Statement of Additional Information for more information on
these investment activities.
REPURCHASE AGREEMENTS. Securities held by the Small Cap Equity Fund may be
subject to repurchase agreements. Under the terms of a repurchase agreement, the
Fund would acquire securities from financial institutions such as member banks
of the Federal Deposit Insurance Corporation or registered broker-dealers which
the Investment Adviser deems creditworthy under guidelines approved by the
Fund's Board of Trustees, subject to the seller's agreement to repurchase such
securities at a mutually agreed upon date and price. The repurchase price would
generally equal the price paid by the Small Cap Equity Fund plus interest
negotiated on the basis of current short-term rates, which may be more or less
than the rate on the underlying portfolio securities. The seller under a
repurchase agreement will be required to maintain the value of collateral held
pursuant to the agreement at not less than the repurchase price (including
accrued interest) and the Investment Adviser will monitor the collateral's value
to ensure that it equals or exceeds the repurchase price. Repurchase agreements
are considered to be loans by an investment company under the Investment Company
Act of 1940, as amended (the "1940 Act"). See the Statement of Additional
Information for more information regarding this investment practice.
REVERSE REPURCHASE AGREEMENTS. The Small Cap Equity Fund may borrow funds for
temporary purposes by entering into reverse repurchase agreements in accordance
with the investment restrictions
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<PAGE> 12
described below. Pursuant to such agreements, the Fund would sell portfolio
securities to financial institutions such as banks and broker-dealers and agree
to repurchase them at a mutually agreed upon date and price. At the time the
Fund enters into a reverse repurchase agreement, it will place in a segregated
custodial account assets, such as liquid high quality securities, consistent
with the Fund's investment objective having a value not less than 100% of the
repurchase price (including accrued interest), and the Investment Adviser will
subsequently monitor the account to ensure that such required value is
maintained. Reverse repurchase agreements involve the risk that the market value
of the securities sold by the Fund may decline below the price at which the Fund
is obligated to repurchase the securities. Reverse repurchase agreements are
considered to be borrowings by an investment company under the 1940 Act.
WHEN-ISSUED SECURITIES. The Small Cap Equity Fund may purchase securities on a
when-issued basis. When-issued securities are securities purchased for delivery
beyond the normal settlement date at a stated price and yield and thereby
involve a risk that the yield obtained in the transaction will be less than
those available in the market when delivery takes place. The Fund will generally
not pay for such securities or start earning interest on them until they are
received. When the Fund agrees to purchase such securities, its Custodian will
set aside cash or liquid high grade securities equal to the amount of the
commitment in a separate account with the Custodian or a Sub-Custodian of the
Small Cap Equity Fund. Securities purchased on a when-issued basis are recorded
as an asset and are subject to changes in value based upon changes in the
general level of interest rates. The Fund expects that commitments to purchase
when-issued securities will not exceed 25% of the value of its total assets
absent unusual market conditions. In the event that its commitments to purchase
when-issued securities ever exceed 25% of the value of its assets, the Fund's
liquidity and the ability of the Investment Adviser to manage it might be
severely affected. The Fund does not intend to purchase when-issued securities
for speculative purposes but only in furtherance of its investment objective.
PRIVATE PLACEMENT INVESTMENTS. The Small Cap Equity Fund may invest in
commercial paper issued in reliance on the so-called "private placement"
exemption from registration afforded by Section 4(2) of the Securities Act of
1933, and resold to qualified institutional buyers under Securities Act Rule
144A ("Section 4(2) paper"). Section 4(2) paper is restricted as to disposition
under the federal securities laws, and generally is sold to institutional
investors such as the Fund who agree that they are purchasing the paper for
investment and not with a view to public distribution. Any resale by the
purchaser must be in an exempt transaction and may be accomplished in accordance
with Rule 144A. Section 4(2) paper normally is resold to other institutional
investors like the Fund through or with the assistance of the issuer or
investment dealers who make a market in the Section 4(2) paper, thus providing
liquidity. The Fund will not invest more than 10% of its net assets in Section
4(2) paper and illiquid securities unless the Investment Adviser determines, by
continuous reference to the appropriate trading markets and pursuant to
guidelines approved by the Board of Trustees, that any Section 4(2) paper held
by the Fund in excess of this level is at all times liquid.
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<PAGE> 13
Because it is not possible to predict with assurance exactly how this
market for Section 4(2) paper sold and offered under Rule 144A will develop, the
Board of Trustees and the Investment Adviser, pursuant to the guidelines
approved by the Board of Trustees, will carefully monitor the Fund's investments
in these securities, focusing on such important factors, among others, as
valuation, liquidity, and availability of information. Investments in Section
4(2) paper could have the effect of reducing the Fund's liquidity to the extent
that qualified institutional buyers become for a time not interested in
purchasing these restricted securities.
INVESTMENT RESTRICTIONS
-----------------------
The Fund is subject to a number of investment restrictions that may be
changed only by a vote of a majority of the outstanding Shares of the Fund (as
defined in "GENERAL INFORMATION-Miscellaneous").
Pursuant to these investment restrictions:
1. The Fund will not purchase a security if, as a result, with respect
to 75% of its portfolio (i) more than 5% of the value of its total assets would
be invested in any one issuer, or (ii) it would hold more than 10% of any class
of securities of such issuer or more than 10% of the outstanding voting
securities of the issuer. There is no limit on the percentage of assets that may
be invested in U.S. Treasury bills, notes, or other obligations issued or
guaranteed by the U.S. government or its agencies and instrumentalities. For
purposes of this and the immediately following limitation, a security is
considered to be issued by the government entity (or entities) whose assets and
revenues back the security, or, with respect to a private activity bond that is
backed only by the assets and revenues of a non-governmental user, such
non-governmental user.
2. The Fund will not purchase a security if, as a result, more than 25%
of the value of its total assets would be invested in securities of one or more
issuers conducting their principal business activities in the same industry,
provided that (a) this limitation shall not apply to obligations issued or
guaranteed by the U.S. government or its agencies and instrumentalities; (b)
wholly owned finance companies will be considered to be in the industries of
their parents if their activities are primarily related to financing the
activities of their parents; and (c) utilities will be divided according to
their services. For example, gas, gas transmission, electric and gas, electric,
and telephone will each be considered a separate industry.
3. The Fund may not borrow money or issue senior securities, except
that the Fund may borrow from banks or enter into reverse repurchase agreements
for temporary purposes in amounts up to 10% of the value of its total assets at
the time of such borrowing; or mortgage, pledge, or
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<PAGE> 14
hypothecate any assets, except in connection with any such borrowing and in
amounts not in excess of the lesser of the dollar amounts borrowed or 10% of the
value of the Fund's total assets at the time of its borrowing. The Fund will not
purchase securities while its borrowings (including reverse repurchase
agreements) exceed 5% of its total assets.
4. The Fund may not make loans, except that the Fund may, in accordance
with its investment objectives and policies, purchase or hold debt instruments,
lend portfolio securities, and enter into repurchase agreements.
5. The Fund will not enter into a repurchase agreement with a maturity
in excess of seven days if such investment, together with other instruments in
the Fund which are not readily marketable, exceeds 10% of the Fund's net assets.
VALUATION OF SHARES
-------------------
The net asset value of the Fund is determined and its Shares are priced
as of the close of regular trading of the New York Stock Exchange ("NYSE")
(generally 4:00 p.m. Eastern time) on each Business Day ("Valuation Time"). As
used herein, a "Business Day" constitutes any day on which the NYSE is open for
trading, and the Federal Reserve Bank of Kansas City is open, except days on
which there are not sufficient changes in the value of the Fund's portfolio
securities that the Fund's net asset value might be materially affected, or days
during which no Shares are tendered for redemption and no orders to purchase
Shares are received. Currently, the NYSE or the Federal Reserve Bank of Kansas
City is closed on the following holidays: New Year's Day, Martin Luther King,
Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Columbus Day, Veteran's Day, Thanksgiving Day and Christmas Day. Net asset
value per Share for purposes of pricing sales and redemptions is calculated by
dividing the value of all securities and other assets belonging to the Fund,
less the liabilities charged to the Fund, by the number of its outstanding
Shares.
The securities in the Fund will be valued at market value. If market
quotations are not readily available, the securities will be valued by a method
which the Fund's Board of Trustees believes accurately reflects fair value. Debt
securities with remaining maturities of 60 days or less will be valued in
accordance with the amortized cost method where the Fund's Trustees determine
that amortized cost is fair value. For further information about valuation of
investments, see the Statement of Additional Information.
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<PAGE> 15
HOW TO PURCHASE SHARES
----------------------
Shares of the Fund are sold on a continuous basis and may be purchased
directly from the Fund's Distributor, BISYS, either by mail, by telephone, or by
electronic transfer. Shares may also be purchased through a bank or
broker-dealer who has established a dealer agreement with the Distributor.
Except as described in "Auto Invest Plan" below, the minimum initial purchase is
$1,000, and the minimum for subsequent purchases is only $100. These minimums
may be waived if purchases are made in connection with Individual Retirement
Accounts ("IRAs"), Keoghs, qualified pension plans, similar plans, or other
employer plans. For information on IRAs, Keoghs or similar plans, contact BOK at
(918) 588-6586.
BY MAIL
- -------
Investors may purchase Shares of the Fund by completing and signing an
Account Registration form and mailing it, along with a check (or other
negotiable bank instrument or money order) for at least $1,000, payable to the
appropriate Fund, in care of the Fund's Custodian at Bank of Oklahoma, N.A.,
Attention: American Performance Funds, Department 12, Tulsa, Oklahoma 74182.
Subsequent purchases of Shares may be made at any time by mailing a check (or
other negotiable bank draft or money order) for at least $100, payable to the
Fund, to the above address.
Account Registration forms can be obtained by calling the Fund at (800)
762-7085.
BY TELEPHONE OR ELECTRONIC TRANSFER
- -----------------------------------
If an investor's Account Registration form has been previously received
by the Distributor, investors may also purchase Shares of the Fund by telephone
or by electronic transfer to the Fund's Custodian. To place an order by
telephone, call the Fund toll-free at (800) 762-7085. Payment for Shares ordered
by telephone may be made by check and must be received by the Fund's Custodian
within the settlement requirements defined under the Securities Exchange Act of
1934. Shares of the Fund ordered by telephone will be purchased for the
Shareholder's account when the order has been received. Any questions regarding
current settlement requirements or electronic payment instructions should be
directed to the Fund at (800) 762-7085.
If payment for the Shares is not received within the prescribed time
periods, or if a check timely received does not clear, the purchase will be
canceled and the investor could be liable for any losses or fees incurred.
AUTO INVEST PLAN
- ----------------
The Fund offers an Auto Invest Plan which enables Shareholders of the
Fund to make regular monthly or quarterly purchases of Shares through automatic
deductions from their bank
-13-
<PAGE> 16
accounts. With Shareholder authorization, the Transfer Agent deducts the amount
specified from the Shareholder's bank account which is then automatically
invested in Shares at net asset value. The required minimum initial investment
when opening an account using the Auto Invest Plan is $100; the minimum amount
for subsequent investments in the Fund is $50. To participate in the Auto Invest
Plan, Shareholders should complete the appropriate section of the Account
Registration form which can be acquired by calling (800) 762-7085. To change the
Auto Invest instructions, a Shareholder must submit a written request to the
Fund. A Shareholder may discontinue the feature by submitting a written request
to or by calling the Fund.
FUND DIRECT INDIVIDUAL RETIREMENT ACCOUNTS ("IRAS")
- ---------------------------------------------------
A Fund Direct IRA enables individuals, even if they participate in an
employer-sponsored retirement plan, to establish their own retirement program.
IRA contributions may be tax-deductible and earnings are tax-deferred. Under the
Tax Reform Act of 1986, the tax deductibility of IRA contributions is restricted
or eliminated for individuals who participate in certain employer pension plans
and whose annual income exceeds certain limits. Existing IRAs and future
contributions up to the IRA maximums, whether deductible or not, still earn
income on a tax-deferred basis.
All IRA distribution requests must be made in writing to the Fund. Any
additional deposits to an IRA must distinguish the type and year of the
contribution. For more information on an IRA call the Fund at (800) 762-7085.
Shareholders are advised to consult a tax adviser on IRA contribution and
withdrawal requirements and restrictions.
OTHER INFORMATION REGARDING PURCHASES
- -------------------------------------
Shares may also be purchased through procedures established by the
Distributor in connection with the requirements of qualified accounts maintained
by or on behalf of certain persons ("Customers") by Participating Organizations
under the Fund's Distribution Plan (See "DISTRIBUTION"). Shares of any the Fund
sold to a Participating Organization on behalf of Customers will normally be
held of record by the Participating Organization and it is the responsibility of
the Participating Organization to transmit purchase or redemption orders to the
Distributor and to deliver funds for the purchase thereof on a timely basis.
Depending upon the terms of a particular Customer account, a
Participating Organization may charge a Customer account fees for services
provided in connection with investment in the Fund. Information concerning these
services and any charges can be obtained from the Participating Organization or
one of its affiliates. This Prospectus should be read in conjunction with any
such information so received.
Shares of the Fund are purchased at the net asset value per share (see
"VALUATION OF SHARES") next determined after receipt by the Distributor of an
order to purchase Shares in good
-14-
<PAGE> 17
form, plus any applicable sales charge as described below. Purchases of Shares
in the Fund will be effected only on a Business Day (as defined in "VALUATION OF
SHARES") of the Fund. An order received prior to the Valuation Time on any
Business Day will be executed at the net asset value determined as of the
Valuation Time on the day of receipt. An order received after the Valuation Time
on any Business Day will be executed at the net asset value determined as of the
Valuation Time on the next Business Day.
In the case of orders for the purchase of Shares placed through a
broker-dealer, the applicable public offering price will be the net asset value
as so determined, but only if the broker-dealer receives the order prior to the
Valuation Time for that day and transmits it to the Distributor prior to the
Valuation Time for that day. The broker-dealer is responsible for transmitting
such orders promptly. If the broker-dealer fails to do so, the investor's right
to that day's closing price must be settled between the investor and the
broker-dealer. If the broker-dealer receives the order after the Valuation Time
for that day, the price will be based on the net asset value determined as of
the Valuation Time for the next day.
The Fund reserves the right to reject any order for the purchase of its
Shares in whole or in part, including purchases made with foreign and third
party checks.
Every Shareholder will receive a confirmation of each new transaction
in the Shareholder's account, which will show the total number of Shares of the
Fund owned by the Shareholder and the number of Shares being held in safekeeping
by the Transfer Agent for the account of the Shareholder. Confirmation of
purchases and redemptions of Shares of the Fund by a Participating Organization
on behalf of a Customer will be sent by the Participating Organization.
Shareholders may rely on these statements in lieu of certificates. No
certificates representing Shares of the Fund will be issued.
SALES CHARGES
-------------
The public offering price of a Share of the Fund equals its net asset
value plus a sales charge. BISYS receives this sales charge as Distributor and
reallows a portion of it as dealer discounts and brokerage commissions. However,
the Distributor, at its sole discretion, may pay certain dealers all or part of
the portion of the sales charge it receives. A broker or dealer who receives a
reallowance in excess of 90% of the sales charge may be deemed to be an
"underwriter" for purposes of the Securities Act of 1933.
-15-
<PAGE> 18
The following table sets forth information pertaining to the Sales
Charges for the Fund.
<TABLE>
<CAPTION>
Dealer Discounts
Sales and Brokerage
Charge as a Sales Charge Commissions as
Percentage of as a Percentage a Percentage of
Net Amount of Net Public Offering
Amount of Purchase Invested Offering Price Price
- ------------------ ------------- --------------- ----------------
<S> <C> <C> <C>
Less than $50,000........................... 5.26% 5.00% 4.50%
$50,000 but less than $100,000.............. 3.90% 3.75% 3.25%
$100,000 but less than $250,000............. 2.83% 2.75% 2.50%
$250,000 but less than $500,000............. 2.04% 2.00% 1.75%
$500,000 but less than $1,000,000........... 1.78% 1.75% 1.60%
$1,000,000 or more.......................... 0.00% 0.00% 0.00%
</TABLE>
From time to time dealers who receive dealer discounts and brokerage
commissions from the Distributor may reallow all or a portion of such dealer
discounts and brokerage commissions to other dealers or brokers.
-16-
<PAGE> 19
SALES CHARGE WAIVERS
--------------------
The Distributor may periodically waive the sales charges for all
customers with respect to the Fund. In addition, the Distributor may waive the
sales charge for the purchase of a Fund's shares with the proceeds from the
recent redemption of shares of another non-money market mutual fund that imposes
a sales charge.
The sales charges may also be waived for (1) investors who purchase
through accounts with the Investment Adviser and through their existing trust
relationship with the Investment Adviser; (2) employees of the Investment
Adviser or its affiliates; (3) each Trustee of the Fund and any employee of a
company that constitutes the principal business activity of a Trustee; (4)
employees of the Distributor and its affiliates; (5) orders placed on behalf of
other investment companies distributed by The BISYS Group, Inc. or its
affiliated companies; (6) existing Shareholders who own Shares in the Fund
within their trust accounts and purchase additional Shares outside of these
trust relationships; (7) investors within wrap accounts; (8) investors who
purchase in connection with 401(k) plans, 403(b) plans, and other
employer-sponsored, qualified retirement plans; and (9) investors who purchase
in connection with non-transactional fee fund programs and programs offered by
fee-based financial planners and other types of financial institutions.
Each investor described in paragraphs (2), (3), (4), (6), (8), and (9)
above must identify himself or herself at the time of purchase. When an investor
who has previously redeemed Shares of any American Performance Fund re-enters
the American Performance Funds, the sales charge on the newly purchased shares
will be waived on a one-time basis in an amount up to the total of any sales
charge paid on the Shares previously redeemed. If the Shareholder exercising
this re-entry privilege paid a sales charge on the redeemed shares and held them
for less than 91 days, such Shareholder must reduce his or her cost basis of the
redeemed shares for purposes of determining any capital gain or loss on the
redemption by the lesser of (1) the sales charge paid for those shares, or (2)
the sales charge waived in connection with the purchase of the new shares. The
Fund reserves the right to alter the terms of their sales charge waiver
practices upon sixty days' notice to Shareholders.
CONCURRENT PURCHASES AND RIGHT OF ACCUMULATION
----------------------------------------------
For purposes of qualifying for a reduced sales charge, investors have
the privilege of combining concurrent purchases of, and holdings in, shares of
the Fund sold with a sales charge ("Eligible Shares"). Investors are permitted
to purchase Eligible Shares at the public offering price applicable to the total
of (a) the dollar amount of the Eligible Shares then being purchased plus (b) an
amount equal to the then-current net asset value of the purchaser's combined
holdings of Eligible Shares.
-17-
<PAGE> 20
To receive the applicable public offering price pursuant to concurrent
purchases and the right of accumulation, Shareholders must, at the time of
purchase, give the Distributor sufficient information to permit confirmation of
qualification. Investors may combine purchases of Eligible Shares that are made
in their individual capacity with (1) purchases that are made by members of
their immediate household and (2) purchases made by businesses that they own as
sole proprietorships, for purposes of obtaining reduced sales charges pursuant
to concurrent purchases and the right of accumulation. In order to accomplish
this, however, investors must designate on the Account Registration form the
accounts that are to be combined for this purpose. Investors can only designate
accounts that are open at the time of the concurrent purchases and when the
right of accumulation is exercised.
LETTER OF INTENT
----------------
You may obtain a reduced sales charge by means of a written Letter of
Intent which expresses your intention to invest, within a period of 13 months, a
certain amount in Shares of the Fund which charges a sales load. Each purchase
of Shares under a Letter of Intent will be made at the public offering price
plus the sales charge applicable at the time of such purchase to a single
transaction of the total dollar amount indicated in the Letter of Intent. A
Letter of Intent may include purchases of Shares made not more than 90 days
prior to the date the investor signs a Letter of Intent; however, the 13-month
period during which the Letter of Intent is in effect will begin on the date of
the earliest purchase to be included.
A Letter of Intent is not a binding obligation upon the investor to
purchase the full amount indicated. The minimum initial investment under a
Letter of Intent is 5% of such amount. Shares purchased with the first 5% of
such amount will be held in escrow (while remaining registered in the name of
the investor) to secure payment of the higher sales charge applicable to the
Shares actually purchased if the full amount indicated is not purchased. Such
escrowed Shares will be involuntarily redeemed to pay the additional sales
charge, if necessary. Dividends on escrowed Shares, whether paid in cash or
reinvested in additional Shares are not subject to escrow. The escrowed Shares
will not be available for disposal by the investor until all purchases pursuant
to the Letter of Intent have been made or the higher sales charge has been paid.
When the full amount indicated has been purchased, the escrow will be released.
Additionally, if the total purchases within the 13-month period exceed
the amount specified, an adjustment will be made to reflect further reduced
sales charges applicable to such purchases. Adjustments for these purchases and
purchases made during the 90-day period prior to submission of the Letter of
Intent will be made at the conclusion of the 13-month period and in the form of
additional shares credited to the shareholder's account at the then current
Public Offering Price applicable to a single purchase of the total amount of the
total purchase.
-18-
<PAGE> 21
For further information, interested investors should contact the
Distributor. Letter of Intent privileges may be amended or terminated without
notice at any time by the Distributor.
EXCHANGE PRIVILEGE
------------------
Shares of the Fund may be exchanged without payment of a sales charge
for Shares of any American Performance Fund having a sales charge equal to or
less than that of the Small Cap Equity Fund Shares sought to be exchanged. If
the Shareholder exercising the exchange privilege paid a sales charge on the
exchanged Shares that is less than the sales charge applicable to the Shares
sought to be acquired through the exchange, such Shareholder must pay a sales
charge on the exchange equal to the difference between the sales charge paid for
the exchanged Shares and the sales charge applicable to the Shares sought to be
acquired through the exchange. The exchange will be made on the basis of the
relative net asset values of the Shares exchanged. An exchange is considered a
sale of Shares and may result in a capital gain or loss for federal income tax
purposes. If the Shareholder exercising the exchange privilege paid a sales
charge on the exchanged Shares and held them for less than 91 days, for purposes
of determining the amount of the capital gain or loss, such Shareholder must
reduce his or her cost basis of the exchanged Shares by the lesser of (1) the
sales charge paid for those Shares, or (2) the sales charge waived on the
exchange. The sales charge is treated as incurred in connection with the
acquisition of the newly exchanged-for Shares. The exchange privilege may only
be exercised in states where the exchange may legally be made. The Fund reserves
the right to eliminate or to alter the terms of this exchange offer upon sixty
days' notice to Shareholders.
A Shareholder wishing to exchange his or her Shares may do so by
contacting the Fund at (800) 762-7085 or by providing written instructions to
the Distributor. Any Shareholder who wishes to make an exchange must have
received a current Prospectus of the Fund in which he or she wishes to invest
before the exchange will be effected.
HOW TO REDEEM SHARES
--------------------
Shares may ordinarily be redeemed by mail or by telephone. Shareholders
may redeem their Shares without charge on any day that the net asset value is
calculated (see "VALUATION OF SHARES"). However, all or part of a Customer's
Shares may be redeemed in accordance with instructions and limitations
pertaining to his or her account held at a Participating Organization.
BY MAIL
- -------
Shares may be redeemed by mail by sending a written request to the
Distributor in care of the Fund's Custodian at Bank of Oklahoma, N.A.,
Attention: American Performance Funds, Department 12, Tulsa, Oklahoma 74182. The
Distributor may require a signature guarantee by an
-19-
<PAGE> 22
eligible guarantor institution. For purposes of this policy, the term "eligible
guarantor institution" shall include banks, brokers, dealers, credit unions,
securities exchanges and associations, clearing agencies and savings
associations as those terms are defined in Rule 17Ad-15 under the Securities
Exchange Act of 1934. The Distributor reserves the right to reject any signature
guarantee if (i) it has reason to believe that the signature is not genuine,
(ii) it has reason to believe that the transaction would otherwise be improper,
or (iii) the guarantor institution is a broker or dealer that is neither a
member of a clearing corporation nor maintains net capital of at least $100,000.
The signature guarantee requirements will be waived if all of the following
conditions apply: (1) the redemption check is payable to the Shareholder(s) of
record, and (2) the redemption check is mailed to the Shareholder(s) at the
address of record. The Shareholder may also have the proceeds mailed or sent
electronically to a commercial bank account previously designated on the Account
Registration form or by written instruction to the Distributor. There is no
charge for having redemption requests mailed to a designated bank account.
BY TELEPHONE
- ------------
Shares may be redeemed by telephone if the Account Registration form
reflects that the Shareholder has that capability. The Shareholder may have the
proceeds mailed to his or her address or mailed or sent electronically to a
commercial bank account previously designated on the Account Registration form.
Under most circumstances, payments will be transmitted on the next Business Day
following receipt of a valid request for redemption. Electronic payment requests
may be made by the Shareholder by calling the Fund at (800) 762-7085. The
Transfer Agent may reduce the amount of a wire redemption payment by the
Custodian's then-current wire redemption charge (presently $15.00). Neither the
Distributor, the Transfer Agent, the Investment Adviser, nor the Fund will be
liable for any losses, damages, expenses or costs arising out of any telephone
transaction (including exchanges and redemptions) effected in accordance with
the Fund's telephone transaction procedures, upon instructions reasonably
believed to be genuine. The Fund will employ procedures designed to provide
reasonable assurance that the instructions communicated by telephone are
genuine; if these procedures are not followed, the Fund may be liable for any
losses due to unauthorized or fraudulent instructions. These procedures include
recording all phone conversations, sending confirmations to Shareholders within
72 hours of the telephone transaction, verifying the account name and a
Shareholder's account number or tax identification number and sending redemption
proceeds only to the address of record or to a previously authorized account.
If, due to temporary adverse conditions, investors are unable to effect
telephone transactions, Shareholders may also mail the redemption request to the
Distributor at the address listed above under "HOW TO REDEEM SHARES -- By Mail."
The telephone redemption option will be suspended for a period of 10 days
following a telephonic address change.
-20-
<PAGE> 23
SYSTEMATIC WITHDRAWAL PLAN
- --------------------------
The Systematic Withdrawal Plan enables Shareholders of the Fund to make
regular monthly or quarterly redemptions of Shares if their account has at least
$10,000. With Shareholder authorization, the Transfer Agent will automatically
redeem Shares at the net asset value on the dates of the withdrawal and have a
check in the amount specified mailed to the Shareholder. The required minimum
withdrawal is $100. To participate in the Systematic Withdrawal Plan,
Shareholders should call (800) 762-7085 for more information. Purchases of
additional Shares concurrent with withdrawals may be disadvantageous to certain
Shareholders because of tax liabilities. To change the Systematic Withdrawal
instructions, a Shareholder must submit a written request to the Distributor. A
Shareholder may discontinue the feature by submitting a written request to or by
calling the Fund.
OTHER INFORMATION REGARDING REDEMPTIONS
- ---------------------------------------
All redemption orders are effected at the net asset value per Share
next determined after receipt of a valid request for redemption, as described
above. Payment to Shareholders for Shares redeemed will be made within the
settlement requirements defined in the Securities Exchange Act of 1934, after
receipt by the Distributor of the request for redemption. However, to the
greatest extent possible, the Trust will attempt to honor requests from
Shareholders for next Business Day payments upon redemption of Shares if the
request for redemption is received by the Transfer Agent before the last
Valuation Time on a Business Day or, if the request for redemption is received
after the last Valuation Time, to honor requests for payment within two Business
Days, unless it would be disadvantageous to the Trust or the Shareholders of the
particular Fund to sell or liquidate portfolio securities in an amount
sufficient to satisfy requests for payments in that manner.
At various times, the Fund may be requested to redeem Shares for which
it has not yet received good payment. In such circumstances, the forwarding of
proceeds may be delayed for up to 15 days until payment has been collected for
the purchase of such Shares. The Fund intends to pay cash for all Shares
redeemed, but under abnormal conditions which make payment in cash unwise,
payment may be made wholly or partly in readily marketable portfolio securities
with a market value equal to the redemption price. In such cases, an investor
may incur brokerage costs in converting such securities to cash.
Due to the relatively high cost of handling small investments, the Fund
reserves the right to redeem, at net asset value, the Shares of any Shareholder
if, because of redemptions of Shares by or on behalf of the Shareholder, the
account of such Shareholder in the Fund has a value of less than $500.
Accordingly, an investor purchasing Shares of the Fund in only the minimum
investment amount may be subject to such involuntary redemption if he or she
thereafter redeems some of his or her Shares. Before the Fund exercises its
right to redeem such Shares and to send the proceeds to the Shareholder, the
Shareholder will be given notice that the value of the Shares in his or her
account is
-21-
<PAGE> 24
less than the minimum amount and will be allowed 60 days to make an additional
investment in the Fund in an amount which will increase the value of the account
to at least $500.
See the Fund's Statement of Additional Information -- "ADDITIONAL
PURCHASE AND REDEMPTION INFORMATION" -- for examples of when the right of
redemption may be suspended.
DIVIDENDS
---------
Net investment income of the Small Cap Equity Fund is declared and paid
quarterly as a dividend to persons who are Shareholders at the close of business
on the day of declaration. Net capital gain income is distributed at least once
a year. A Shareholder will automatically receive all income dividends and
capital gains distributions in additional full and fractional Shares at net
asset value as of the ex-dividend date, unless the Shareholder elects to receive
dividends or distributions in cash. Reinvested dividends receive the same tax
treatment as dividends paid in cash. Such election, or any revocation thereof,
must be made in writing to the Distributor at: BISYS Fund Services, 3435 Stelzer
Road, Columbus, Ohio 43219 and will become effective with respect to dividends
and distributions having record dates after its receipt by the Distributor.
Shareholders may elect to have all income, dividends, and capital gains
distributions paid by check or reinvested in the Fund. If you elect to receive
distributions paid by check and the check (1) is returned and marked as
"undeliverable" or (2) remains uncashed for six months, your payment election
will be changed automatically and your future dividend and capital gains
distribution will be reinvested in the Fund at the per share net asset value
determined as of the date of payment of the distribution. In addition, any
undeliverable check that remains uncashed for six months will be canceled and
reinvested in the Fund at the per share net asset value determined as of the
date of cancellation.
FEDERAL INCOME TAXES
--------------------
The Fund is treated as a separate entity for federal income tax
purposes. The Fund intends to qualify as a "regulated investment company" under
the Internal Revenue Code of 1986, as amended (the "Code"), and intends to
distribute all of its net investment income and capital gains so that it is not
required to pay federal income taxes on amounts so distributed to Shareholders.
Shareholders will be advised at least annually as to the federal income tax
consequences of distributions made during the year.
Receipt by a Shareholder of a distribution of ordinary income and/or an
excess of net short-term capital gain over net long-term loss is treated as a
receipt of ordinary income, whether such distribution is paid in cash or
additional shares. The "70 percent dividends-
-22-
<PAGE> 25
received deduction" for corporations generally will apply to these distributions
to corporate shareholders that meet the holding period requirement in the Code
to the extent the distribution represents amounts that would qualify for the
dividends-received deduction if the Fund making the distribution were a regular
corporation, and to the extent designated by the Fund as so qualifying.
Distributions designated by the Fund as deriving from net gains on
securities held for more than one year are generally taxable to Shareholders as
such in the year in which they are received, regardless of how long the
Shareholder has held Shares in the Fund. Such capital gain dividends are not
eligible for the dividends-received deduction.
A Shareholder will generally recognize capital gain or loss on the sale
or exchange of Shares in the Fund. If a Shareholder disposes of Shares in the
Fund at a loss before holding such Shares for longer than six months, such loss
will be treated as a long-term capital loss to the extent the Shareholder has
received a capital gain dividend on the Shares.
Fund investments in foreign securities may be subject to withholding
taxes at the source on dividend or interest payments. In that case, the Fund's
yield on those securities would be decreased.
Distributions are taxable to a shareholder of the Fund even if they are
paid from income or gains earned by the Fund prior to the shareholder's
investment (and thus were included in the price paid by the shareholder).
Additional information regarding federal income taxes is contained in
the Statement of Additional Information under "INVESTMENT OBJECTIVE AND POLICIES
- - Additional Tax Information Concerning the Fund." However, the foregoing and
the material in the Statement of Additional Information are only brief summaries
of some of the important tax considerations generally affecting the Fund and its
Shareholders. In addition, the foregoing discussion and the federal tax
information in the Statement of Additional Information are based on tax laws and
regulations which are in effect as of the date of this Prospectus; these laws
and regulations may subsequently change. Prospective investors in the Fund are
advised to consult their tax adviser with special reference to their own tax
situations, including the potential application of foreign, state and local
taxes.
DISTRIBUTION
------------
Shares of the Fund are sold on a continuous basis by the Distributor
for the Fund, BISYS Fund Services (the "Distributor"). Under the Fund's
Distribution and Shareholder Services Plan (the "Distribution Plan"), the Fund
will pay a monthly distribution fee (also referred to as a 12b-1 Fee) to the
Distributor as compensation for its services in connection with the Distribution
Plan at an annual rate equal to the lesser of (1) such fee as may from time to
time be agreed upon in writing by the Fund and the Distributor, or (2)
twenty-five one-hundredths of one percent (0.25%) of the average
-23-
<PAGE> 26
daily net assets of the Fund. The Distributor may use the distribution fee to
provide distribution assistance with respect to the Fund's Shares or to provide
Shareholder services to the holders of the Fund's Shares ("Customers") purchased
through financial institutions and intermediaries, broker-dealers, or similar
entities, including affiliates or subsidiaries of the Distributor
("Participating Organizations") pursuant to contractual arrangements with the
Distributor under the Distribution Plan.
The distribution fee will be payable without regard to whether the
amount of the fee is more or less than the actual expenses incurred in a
particular year by the Distributor in connection with distribution assistance or
Shareholder services rendered by the Distributor itself or incurred by the
Distributor pursuant to contractual agreement entered into under the
Distribution Plan.
The Glass-Steagall Act and other applicable laws generally prohibit
banks from engaging in the business of underwriting securities, but in general
do not prohibit banks from purchasing securities as agent for and upon the order
of customers. Accordingly, banks acting as Participating Organizations may
provide only those services which, in the banks' opinion, are consistent with
the then current legal requirements. It is possible, however, that future
legislative, judicial or administrative action affecting the securities
activities of banks will cause the Fund to alter or discontinue its arrangements
with banks that act as Participating Organizations, or change its method of
operations. It is not anticipated, however, that any change in the Fund's method
of operations would affect its net asset value per share or result in financial
loss to any customer. See the Statement of Additional Information for further
information regarding the Distribution Plan and "MANAGEMENT OF THE SMALL CAP
EQUITY FUND - Banking Laws" for information concerning the applicability of the
Glass-Steagall Act to the Investment Adviser's investment advisory services to
the Fund.
MANAGEMENT OF THE SMALL CAP EQUITY FUND
---------------------------------------
TRUSTEES OF THE FUND
- --------------------
Overall responsibility for management of the Small Cap Equity Fund
rests with the Board of Trustees of the Fund, who are elected by the
Shareholders of the Fund. The Fund will be managed by the Trustees in accordance
with the laws of the Commonwealth of Massachusetts governing business trusts.
There are currently four Trustees, of whom three are not "interested persons" of
the Fund within the meaning of that term under the 1940 Act. The Trustees, in
turn, elect the officers of the Fund to supervise actively the Fund's day-to-day
operations.
-24-
<PAGE> 27
The Trustees of the Fund and of the Funds, their addresses, and their
principal occupations during the past five years, are as follows:
<TABLE>
<CAPTION>
Position(s) Held Principal Occupation
Name, Address and Age With the Funds During Past Five Years
- --------------------- -------------- ----------------------
<S> <C> <C>
Walter B. Grimm*, 53 Chairman From June, 1992 to present,
3435 Stelzer Road and Trustee employee of BISYS Fund
Columbus, Ohio 43219 Services.
Michael J. Hall, ___ Trustee From December, 1997 to
7130 South Lewis, Suite 850 present, Vice President and
Tulsa, Oklahoma 74136 Chief Executive Officer, Matrix
Service Company; from December,
1995 to November, 1997, Vice
President and Chief Financial
Officer, Worldwide Sports &
Recreation, Inc.; from January,
1994 to present, Vice President and
Chief Financial Officer, Pexco
Holdings, Inc.
Perry A. Wimpey, ___ Trustee From January, 1992 to
4843 S. 69th East Avenue present, Local Financial
Tulsa, Oklahoma 74145 and Regulatory Consultant.
I. Edgar Hendrix, ___ Trustee From June, 1983 to present,
8 East 3rd Street Vice President and Treasurer,
Tulsa, Oklahoma 74103 Parker Drilling Co.
</TABLE>
- --------
*Indicates an "interested person" of the Funds as defined in the 1940 Act.
The Trustees receive fees and are reimbursed for their expenses in
connection with each meeting of the Board of Trustees they attend. However, no
officer or employee of an Investment Adviser, Sub-Adviser, or the Administrator
of the Funds receives any compensation from the Funds for acting as a Trustee.
The officers of the Funds receive no compensation directly from the Funds for
performing the duties of their offices. BISYS receives fees from each Fund of
the Funds for acting as Administrator and may receive additional income under
the Distribution Plan of the Funds.
-25-
<PAGE> 28
INVESTMENT ADVISER
- ------------------
Bank of Oklahoma, N.A. serves as investment adviser to the Fund. BOK,
the largest trust company in the State of Oklahoma, is a subsidiary of BOK
Financial Corporation ("BOK Financial"). BOK Financial is controlled by its
principal shareholder, George B. Kaiser. Through its subsidiaries, BOK Financial
provides a full array of trust, commercial banking and retail banking services.
Its non-bank subsidiaries engage in various bank-related services, including
mortgage banking and providing credit life, accident, and health insurance on
certain loans originated by its subsidiaries.
BOK maintains offices in Tulsa and Oklahoma City and offers a variety
of services for both corporate and individual customers. Individual financial
trust services include personal trust management, administration of estates, and
management of individual investments and custodial accounts. For corporate
clients, the array of services includes management, administration and
recordkeeping of pension plans, thrift plans, 401(k) plans and master trust
plans. BOK has experience in providing investment advisory services to the
Funds, and experience in managing collective investment funds with investment
portfolios and objectives comparable to those of the Funds. BOK also serves as
transfer agent and registrar for corporate securities, paying agent for
dividends and interest, and indenture trustee of bond issues. At July 31, 1998
BOK was responsible for approximately $12.3 billion in assets including
approximately $5.7 billion in assets under management and possessed average
equity capital at $429 million.
Subject to the general supervision of the Fund's Board of Trustees and
in accordance with the investment objective and restrictions of the Fund, BOK
manages the Small Cap Equity Fund, makes decisions with respect to and places
orders for all purchases and sales of their portfolio securities, and maintains
the Fund's records relating to such purchases.
The person primarily responsible for the day-to-day management of the
Small Cap Equity Fund, as well as his previous business experience, is as
follows:
Portfolio Manager Business Experience
- ----------------- -------------------
Grafton M. Potter Manager of the Small Cap Equity Fund
since its inception. Since 1988, Mr.
Potter has served as Director of Equity
Research for BOK.
-26-
<PAGE> 29
For the services provided and expenses assumed pursuant to its
investment advisory agreement with the Fund, BOK receives a fee from the Small
Cap Equity Fund, computed daily and paid monthly equaling the lesser of (1) such
fee as may from time to time be agreed upon by the Fund and BOK, or (2)
sixty-nine one-hundredths of one percent (0.69%) of the Fund's average daily net
assets. BOK receives fee income from the Fund from several other sources. (See
"SALES CHARGES," "DISTRIBUTION," and "GENERAL INFORMATION --Custodian and
Transfer Agent.") BOK may periodically waive all or a portion of its advisory
fee with respect to the Fund to increase the net income of the Fund available
for distribution as dividends. In order to reduce operating expenses, BOK has
currently established the investment advisory fees pertaining to the Small Cap
Equity Fund at 0.00% of the Fund's average daily net assets.
ADMINISTRATOR AND DISTRIBUTOR
- -----------------------------
BISYS is the Administrator for the Fund, and also acts as the Fund's
principal underwriter and Distributor (the "Administrator" or the "Distributor,"
as the context indicates). BISYS is a subsidiary of The BISYS Group, Inc., 150
Clove Road, Little Falls, New Jersey 07424, a publicly owned company engaged in
information processing, loan servicing and 401(k) administration and
recordkeeping services to and through banking and other financial organizations.
The Administrator generally assists in all aspects of the Fund's administration
and operation.
For expenses assumed and services provided as Administrator pursuant to
its management and administration agreement with the Fund, BISYS receives a fee
from the Fund, computed daily and paid periodically, at the lesser of (1) such
fee as may from time to time be agreed upon in writing by the Fund and the
Administrator, or (2) twenty one-hundredths of one percent (0.20%) of the Fund's
average daily net assets. The Administrator may periodically waive all or a
portion of its administrative fee with respect to the Fund to increase the net
income of the Fund available for distribution as dividends.
SUB-ADMINISTRATOR
- -----------------
BOK serves as the Sub-Administrator to the Fund pursuant to an
agreement between the Administrator and BOK. Pursuant to this agreement, BOK has
assumed many of the Administrator's duties, for which BOK receives a fee, paid
by the Administrator, calculated at an annual rate of five one-hundredths of one
percent (0.05%) of the Small Cap Equity Fund's average daily net assets.
-27-
<PAGE> 30
EXPENSES
- --------
The Investment Adviser and the Administrator each bear all expenses in
connection with the performance of their services as investment adviser and
general manager and administrator, respectively, other than the cost of
securities (including brokerage commissions) purchased for the Fund. The Fund
bears the following expenses relating to its respective operations: taxes,
interest, brokerage fees and commissions, fees and travel expenses of the
Trustees of the Fund, Securities and Exchange Commission fees, state securities
qualification fees, costs of preparing and printing prospectuses for regulatory
purposes and for distribution to current Shareholders, outside auditing and
legal expenses, advisory and administration fees, fees and reasonable
out-of-pocket expenses of the custodian and transfer agent, expenses incurred
for pricing securities owned by the Fund, certain insurance premiums, costs of
maintenance of the Fund's existence, costs of Shareholders' and Trustees'
reports and meetings, and any extraordinary expenses incurred in the Fund's
operation.
BANKING LAWS
- ------------
The Investment Adviser believes that it may perform the investment
advisory services for the Funds contemplated by its agreements with the Funds
and by this Prospectus without violating the Glass-Steagall Act. Future changes
in federal or state statutes and regulations relating to permissible activities
of banks or bank holding companies and their subsidiaries and affiliates as well
as further judicial or administrative decisions or interpretations of present
and future statutes and regulations could change the manner in which the
Investment Adviser could continue to perform such services for the Funds. See
the Statement of Additional Information under the heading "MANAGEMENT OF THE
FUND -- Glass-Steagall Act" for further discussion of applicable banking laws
and regulations.
In addition, 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.
GENERAL INFORMATION
-------------------
DESCRIPTION OF THE FUNDS AND THEIR SHARES
- -----------------------------------------
The Small Cap Equity Fund represents a separate series of units of
beneficial interest ("Shares") of American Performance Funds, a Massachusetts
business trust which was organized in October of 1987 and began active
operations in August of 1990. Each Share represents an equal proportionate
interest in a Fund with other Shares of the same series, and is
-28-
<PAGE> 31
entitled to such dividends and distributions out of the income earned on the
assets belonging to that Fund as are declared at the discretion of the Trustees.
Shareholders are entitled to one vote for each Share, and a
proportionate fractional vote for any fraction of a Share, and will vote in the
aggregate and not by series except as otherwise expressly required by law.
Although the Funds are not required to hold annual meetings of
Shareholders, Shareholders have the right (1) to call a meeting to elect or
remove one or more of the Trustees of the Funds and (2) to be assisted by the
Trustees in communicating with other Shareholders of the Funds. Shareholder
inquiries should be directed to the Secretary of the Funds, at 3435 Stelzer
Road, Columbus, Ohio 43219.
Overall responsibility for the management of the Funds is vested in the
Board of Trustees. See "MANAGEMENT OF THE SMALL CAP EQUITY FUND - Trustees of
the Fund." Individual Trustees are elected by the Shareholders and may be
removed by the Board of Trustees or Shareholders in accordance with the
provisions of the Declaration of Trust and By-laws of the Funds and
Massachusetts law. See "ADDITIONAL INFORMATION Miscellaneous" in the Statement
of Additional Information for further information.
CUSTODIAN AND TRANSFER AGENT
- ----------------------------
Bank of Oklahoma, N.A. serves as custodian for the Fund ("Custodian").
BISYS Fund Services Ohio, Inc., an affiliate of BISYS, serves as the transfer
agent for the Fund ("Transfer Agent") and performs fund accounting services.
PERFORMANCE INFORMATION
- -----------------------
From time to time performance information for the Fund showing its
average annual total return and aggregate total return may be presented in
advertisements, sales literature and shareholder reports. Such performance
figures are based on historical earnings and are not intended to indicate future
performance. Total return will be calculated for the period since the
establishment of the Fund and will, unless otherwise noted, reflect the
imposition of the maximum sales charge. For the information of Shareholders not
subject to a sales charge, the Fund may also publish total return figures which
include no sales charge. Average annual total return is measured by comparing
the value of an investment in the Fund at the beginning of the relevant period
to the redemption value of the investment at the end of the period (assuming
immediate reinvestment of any dividends or capital gains distributions) and
annualizing the result. Aggregate total return is measured similarly to average
annual total return, however the resulting difference is not annualized. The
yield of the Fund is determined by annualizing the Fund's net investment income
per share during a recent specified thirty-day period ending on
-29-
<PAGE> 32
the last day of the most recent calendar quarter, and dividing that amount by
the Fund's per share net asset value on the last day of the period.
In addition, from time to time the Fund may present its respective
distribution rates in supplemental sales literature which is accompanied or
preceded by a prospectus and in Shareholder reports. Distribution rates will be
computed by dividing the distribution per share made by the Fund over a
twelve-month period by the maximum offering price per share. The calculation of
income in the distribution rate includes both income and capital gain dividends
and does not reflect unrealized gains or losses, although the Fund may also
present a distribution rate excluding the effect of capital gains. The
distribution rate differs from the yield, because it includes capital items
which are often non-recurring in nature, whereas yield does not include such
items. Distribution rates may also be presented excluding the effect of a sales
charge, if any.
Investors may also judge the performance of the Fund by comparing it to
the performance of other mutual funds or mutual fund portfolios with comparable
investment objectives and policies through various mutual fund or market indices
such as those prepared by Dow Jones & Co., Inc., Standard & Poor's Corporation,
The Russell 2000 Index, and Morningstar, Inc. and to data prepared by Lipper
Analytical Services, Inc. Comparisons may also be made to indices or data
published in Money Magazine, Forbes, Barron's, The Wall Street Journal, The New
York Times, Business Week, Pensions and Investments, Fortune, Ibbotson
Associates, Inc., U.S.A. Today, CDA/Wiesenberger, American Banker, Institutional
Investor and local newspapers. In addition to performance information, general
information about the Fund that appears in a publication such as those mentioned
above may be included in advertisements and in reports to Shareholders.
Total return and yield are functions of the type and quality of
instruments held in the portfolio, operating expenses, and market conditions.
Consequently, total return and yield will fluctuate and are not necessarily
representative of future results. Any fees charged by a Participating
Organization with respect to Customer accounts for investing in shares of the
Fund will not be included in performance calculations; such fees, if charged,
will reduce the actual performance from that quoted. Further information
regarding Performance Comparisons may be found in the Statement of Additional
Information under "Performance Comparisons."
Additional information about the performance of the Small Cap Equity
Fund will be contained in the Fund's Annual Report to Shareholders, which is
available free of charge by calling the telephone number on the front page of
this Prospectus.
-30-
<PAGE> 33
YEAR 2000
- ---------
The investment services industry is evaluating the capability of
existing application software programs and operating systems to accommodate the
date value for the year 2000. Many existing application software products in the
marketplace were designed only to accommodate a two-digit date position, which
represents the year (e.g., "95" is stored on the system and represents the year
1995). If the year 1999 is the maximum date value these systems are able to
accurately process, the improper identification of the year 2000 could result in
a computer system failure or miscalculations causing a disruption of operations.
The Fund's principal service providers are taking steps the Fund believes are
reasonably designed to address the year 2000 issues with respect to the computer
systems those providers operate. However, this is an ongoing process and testing
and other steps are scheduled to be completed in 1999. Nevertheless, the
inability of service providers to successfully address year 2000 issues could
result in interruptions in the Fund's business and have material adverse impact
on the Fund's operations.
MISCELLANEOUS
- -------------
Shareholders will receive unaudited semi-annual reports and annual
reports audited by independent public accountants.
As used in this Prospectus and in the Statement of Additional
Information, "assets belonging to" a Fund means the consideration received by
the Funds upon the issuance or sale of Shares in that Fund, together with all
income, earnings, profits, and proceeds derived from the investment thereof
including any proceeds from the sale, exchange, or liquidation of such
investments, and any funds or payments derived from any reinvestment of such
proceeds, and any general assets of the Funds not readily identified as
belonging to a particular Fund that are allocated to that Fund by the Funds'
Board of Trustees. The Board of Trustees may allocate such general assets in any
manner it deems fair and equitable. It is anticipated that the factor that will
be used by the Board of Trustees in making allocations of general assets to
particular Funds will be the relative net asset values of the respective Funds
at the time of allocation. Assets belonging to a particular Fund are charged
with the direct liabilities and expenses with respect to that Fund, and with a
share of the general liabilities and expenses of the Funds not readily
identified as belonging to a particular Fund that are allocated to that Fund in
proportion to the relative net asset values of the respective Funds at the time
of allocation. The timing of allocations of general assets and general
liabilities and expenses of the Funds to particular Funds will be determined by
the Board of Trustees of the Funds and will be in accordance with generally
accepted accounting principles. Determinations by the Board of Trustees of the
Funds as to the timing of the allocation of general liabilities and expenses and
as to the timing and allocable portion of any general assets with respect to a
particular Fund are conclusive.
-31-
<PAGE> 34
As used in this Prospectus and in the Statement of Additional
Information, a "vote of a majority of the outstanding Shares" of the Funds or
the Fund means the affirmative vote, at a meeting of Shareholders duly called,
of the lesser of (a) 67% or more of the outstanding Shares of the Funds or the
Fund present at a meeting at which the holders of more than 50% of the
outstanding Shares of the Funds or the Fund are represented in person or by
proxy, or (b) the holders of more than 50% of the outstanding shares of the
Funds or the Fund.
Inquiries regarding the Small Cap Equity Fund may be directed in
writing to the Fund at 3435 Stelzer Road, Columbus, Ohio 43219, or by calling
toll free (800) 762-7085.
-32-
<PAGE> 35
AMERICAN PERFORMANCE FUNDS
SMALL CAP EQUITY FUND
INVESTMENT ADVISER
------------------
Bank of Oklahoma, N.A.
Bank of Oklahoma Tower
Tulsa, Oklahoma 74103
ADMINISTRATOR/DISTRIBUTOR
-------------------------
BISYS Fund Services
3435 Stelzer Road
Columbus, Ohio 43219
LEGAL COUNSEL
-------------
Ropes & Gray
One Franklin Square
1301 K Street, N.W.
Suite 800 East
Washington, D.C. 20005
AUDITORS
--------
KPMG Peat Marwick LLP
Two Nationwide Plaza
Columbus, Ohio 43215
-33-
<PAGE> 36
TABLE OF CONTENTS
Page
----
FEE TABLE .................................................................. 3
INVESTMENT OBJECTIVES....................................................... 7
INVESTMENT POLICIES AND SPECIAL CONSIDERATIONS.............................. 7
INVESTMENT RESTRICTIONS..................................................... 11
VALUATION OF SHARES......................................................... 12
HOW TO PURCHASE SHARES...................................................... 13
SALES CHARGES............................................................... 15
SALES CHARGE WAIVERS........................................................ 17
CONCURRENT PURCHASES AND RIGHT OF ACCUMULATION.............................. 17
LETTER OF INTENT............................................................ 18
EXCHANGE PRIVILEGE.......................................................... 19
HOW TO REDEEM SHARES........................................................ 19
DIVIDENDS................................................................... 22
FEDERAL INCOME TAXES........................................................ 22
DISTRIBUTION................................................................ 23
MANAGEMENT OF THE SMALL CAP EQUITY FUND.................................... 24
GENERAL INFORMATION......................................................... 28
-34-
<PAGE> 37
No person has been authorized to give any information or to make any
representations not contained in this Prospectus in connection with the offering
made by this Prospectus and, if given or made, such information or
representations must not be relied upon as having been authorized by the Fund or
the Distributor. This Prospectus does not constitute an offering by the Fund or
by the Distributor in any jurisdiction in which such offering may not lawfully
be made.
-35-
<PAGE> 38
CROSS REFERENCE SHEET
AMERICAN PERFORMANCE FUNDS
STATEMENT OF ADDITIONAL INFORMATION
<TABLE>
<CAPTION>
Form N-1A Part B Item
- ---------------------
<S> <C>
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History The Funds; Additional
Information - Description of Shares
13. Investment Objectives Investment Objective and Policies
and Policies
14. Management of the Fund Management and Service Providers
of the Funds
15. Control Persons and Principal Additional Information - Miscellaneous
Holders of Securities
16. Investment Advisory and Management and Service Providers
of the Funds
Other Services
17. Brokerage Allocation Management of the Funds - Portfolio
and Other Practices Transactions
18. Capital Stock and Other Valuation; Additional Purchase and
Securities Redemption Information; Additional
Information
19. Purchase, Redemption and Valuation; Additional Purchase and
Pricing of Securities Redemption Information; Management
Being Offered and Service Providers of the Funds
</TABLE>
<PAGE> 39
<TABLE>
<CAPTION>
<S> <C>
20. Tax Status Investment Objective and Policies -Additional
Tax Information Concerning All of the Funds;
Investment Objective and Policies - Additional
Tax Information Concerning the Intermediate
Tax-Free Bond Fund
21. Underwriters Management and Service Providers
of the Funds - Distributor;
Management and Service Providers
of the Funds - Distribution
22. Calculation of Performance Additional Information -
Data Calculation of Performance Data
23. Financial Statements Financial Statements
</TABLE>
Part C
Information required to be included in Part C is set forth under the
appropriate Item, so numbered, in Part C of the Registration Statement.
-2-
<PAGE> 40
STATEMENT OF ADDITIONAL INFORMATION
AMERICAN PERFORMANCE FUNDS
AMERICAN PERFORMANCE SMALL CAP EQUITY FUND
February __, 1999
This Statement of Additional Information is not a Prospectus, but should be read
in conjunction with the Prospectus for the American Performance Small Cap Equity
Fund dated February __, 1999. This Statement of Additional Information is
incorporated in its entirety into that Prospectus. A copy of the Prospectus for
the American Performance Small Cap Equity Fund (the "Fund") may be obtained by
writing to the Fund at 3435 Stelzer Road, Columbus, Ohio 43219, or by
telephoning toll free at (800) 762-7085.
<PAGE> 41
<TABLE>
TABLE OF CONTENTS
<CAPTION>
Page
----
<S> <C>
THE FUNDS..................................................................................................1
INVESTMENT OBJECTIVE AND POLICIES..........................................................................1
ADDITIONAL INFORMATION ON FUND INSTRUMENTS...........................................................1
Bank Obligations............................................................................1
U.S. Government Obligations.................................................................3
Purchases of Options........................................................................3
Covered Calls...............................................................................4
Puts........................................................................................6
Futures Contracts...........................................................................6
Mortgage-Related Securities.................................................................7
Foreign Investments.........................................................................9
When-Issued Securities......................................................................9
Securities Lending..........................................................................9
Repurchase Agreements......................................................................10
INVESTMENT RESTRICTIONS.............................................................................10
PORTFOLIO TURNOVER..................................................................................11
ADDITIONAL TAX INFORMATION CONCERNING THE FUND......................................................12
VALUATION.................................................................................................14
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION............................................................14
MANAGEMENT AND SERVICE PROVIDERS OF THE FUNDS.............................................................14
TRUSTEES AND OFFICERS...............................................................................14
INVESTMENT ADVISER AND SUB-ADVISER..................................................................16
DISTRIBUTION........................................................................................19
GLASS-STEAGALL ACT..................................................................................20
PORTFOLIO TRANSACTIONS..............................................................................21
ADMINISTRATOR.......................................................................................23
SUB-ADMINISTRATOR...................................................................................25
DISTRIBUTOR.........................................................................................26
CUSTODIAN, TRANSFER AGENT AND FUND ACCOUNTANT.......................................................26
AUDITORS............................................................................................28
LEGAL COUNSEL.......................................................................................28
ADDITIONAL INFORMATION....................................................................................29
DESCRIPTION OF SHARES...............................................................................29
SHAREHOLDER AND TRUSTEE LIABILITY...................................................................30
CALCULATION OF PERFORMANCE DATA ..................................................................30
PERFORMANCE COMPARISONS.............................................................................32
MISCELLANEOUS.......................................................................................34
FINANCIAL STATEMENTS......................................................................................39
APPENDIX..................................................................................................40
</TABLE>
-i-
<PAGE> 42
THE FUNDS
The American Performance Funds (the "Funds") consist of eleven series
of units of beneficial interest ("Shares") each representing interests in one of
eleven separate investment portfolios of a diversified open-end management
investment company: the American Performance U.S. Treasury Fund (the "U.S.
Treasury Fund"), the American Performance Cash Management Fund (the "Cash
Management Fund"), the American Performance Equity Fund (the "Equity Fund"), the
American Performance Aggressive Growth Fund (the "Aggressive Growth Fund"), the
American Performance Balanced Fund (the "Balanced Fund"), the American
Performance Bond Fund (the "Bond Fund"), the American Performance Intermediate
Bond Fund (the "Intermediate Bond Fund"), the American Performance Intermediate
Tax-Free Bond Fund (the "Intermediate Tax-Free Bond Fund"), the American
Performance Short-Term Income Fund (the "Short-Term Income Fund") , the American
Performance Growth Equity Fund (the "Growth Equity Fund") and the American
Performance Small Cap Equity Fund (the "Small Cap Equity Fund"). The U.S.
Treasury Fund and the Cash Management Fund are sometimes referred to herein as
the "Money Market Funds," the Equity Fund, the Aggressive Growth Fund, the
Balanced Fund and the Growth Equity Fund are sometimes referred to herein as the
"Equity Investment Funds," and the Bond Fund, the Intermediate Bond Fund, the
Intermediate Tax-Free Bond Fund, and the Short-Term Income Fund are sometimes
referred to herein as the "Bond Investment Funds." The American Performance
Aggressive Growth Fund will cease operations on or about February 15, 1999. Much
of the information contained herein expands upon subjects discussed in the
Prospectuses for the respective Funds. No investment in Shares of a Fund should
be made without first reading that Fund's Prospectus.
This Statement of Additional Information relates to the Small Cap
Equity Fund only.
INVESTMENT OBJECTIVE AND POLICIES
The following policies supplement the Small Cap Equity Fund's
investment objective and policies as set forth in the Prospectus for the Fund.
ADDITIONAL INFORMATION ON FUND INSTRUMENTS
BANK OBLIGATIONS
The Small Cap Equity Fund may invest in obligations of the banking
industry such as bankers' acceptances, commercial paper, loan participations,
bearer deposit notes, promissory notes, floating or variable rate obligations,
certificates of deposit, and demand and time deposits.
B-1
<PAGE> 43
Bankers' acceptances: Bankers' acceptances are negotiable drafts or
bills of exchange typically drawn by an importer or exporter to pay for specific
merchandise, which are "accepted" by a bank, meaning, in effect, that the bank
unconditionally agrees to pay the face value of the instrument on maturity. The
Fund will invest in only those bankers' acceptances guaranteed by domestic and
foreign banks having, at the time of investment, total assets in excess of $1
billion (as of the date of their most recently published financial statements).
Certificates of deposit: Certificates of deposit are negotiable
certificates issued against funds deposited in a commercial bank for a definite
period of time and earning a specified return. Certificates of deposit will be
those of domestic and foreign branches of U.S. commercial banks which, at the
time of purchase, have total assets in excess of $1 billion (as of the date of
their most recently published financial statements). Certificates of deposit may
also include those issued by foreign banks outside the United States with total
assets at the time of purchase, in excess of the equivalent of $1 billion. The
Fund may also invest in Eurodollar certificates of deposit which are U.S.
dollar-denominated certificates of deposit issued by branches of foreign and
domestic banks located outside the United States and Yankee certificates of
deposit which are certificates of deposit issued by a U.S. branch of a foreign
bank denominated in U.S. dollars and held in the United States.
In addition, the Fund may invest in bearer deposit notes, which are
negotiable time deposits with a specific maturity date issued by a bank, and
time deposits, which are interest bearing non-negotiable deposits at a bank that
have a specific maturity date.
Commercial Paper: Commercial paper consists of unsecured promissory
notes issued by corporations. Except as noted below with respect to variable
amount master demand notes, issues of commercial paper normally have maturities
of nine months or less and fixed rates of return.
The Fund may also invest in Canadian Commercial Paper which is
commercial paper issued by a Canadian corporation or a Canadian counterpart of a
U.S. corporation and in Europaper which is U.S. dollar-denominated commercial
paper of a foreign issuer.
Variable amount and floating rate notes: Commercial paper eligible for
investment by the Small Cap Equity Fund may include variable amount and floating
rate notes. A variable rate note is one whose terms provide for the readjustment
of its interest rate on set dates and which, upon such readjustment, can
reasonably be expected to have a fair market value that approximates its par
value. A floating rate note is one whose terms provide for the readjustment of
its interest rate whenever a specified interest rate changes and which, at any
time, can reasonably be expected to have a market value that approximates its
par value. Such notes are frequently not rated by credit rating agencies;
however, unrated variable and floating rate notes purchased by the Fund will be
determined by the Investment Adviser under guidelines established by the Fund's
Board of Trustees to be of comparable quality, at the
B-2
<PAGE> 44
time of purchase, to rated instruments which are eligible for purchase under the
Fund's investment policies. In making such determinations, the Investment
Adviser will consider the earning power, cash flow and other liquidity ratios of
the issuers of such notes (such issuers include financial, merchandising, bank
holding and other companies) and will monitor their financial condition.
Although there may be no active secondary market with respect to a particular
variable or floating rate note purchased by the Fund, the Fund may re-sell the
note at any time to a third party. The absence of such an active secondary
market, however, could make it difficult for the Fund to dispose of the variable
or floating rate note involved in the event the issuer of the note defaulted on
its payment obligations, and the Fund could, for this or other reasons, suffer a
loss to the extent of the default. Variable or floating rate notes may be
secured by bank letters of credit or drafts.
Variable or floating rate notes with stated maturities of more than one
year may, under the amortized cost rule of the Securities and Exchange
Commission ("SEC") , 17 C.F.R. ' 270.2a-7, be deemed to have shorter maturities
in accordance with such Rule.
U.S. GOVERNMENT OBLIGATIONS
The Fund may invest in obligations issued or guaranteed by the U.S.
government, its agencies or instrumentalities, some of which may be subject to
repurchase agreements. Obligations of certain agencies and instrumentalities of
the U.S. government are supported by the full faith and credit of the U.S.
government; others are supported by the right of the issuer to borrow from the
government; others are supported by the discretionary authority of the U.S.
government to purchase the agency's obligations; and still others are supported
only by the credit of the instrumentality. No assurance can be given that the
U.S. government would provide financial support to U.S. government-sponsored
agencies or instrumentalities if it is not obligated to do so by law. The Fund
will invest in the obligations of such agencies or instrumentalities only when
the Investment Adviser believes that the credit risk with respect thereto is
minimal. For information on mortgage-related securities issued by certain
agencies or instrumentalities of the U.S. government, see "Investment Objective
and Policies -Mortgage-Related Securities" in this Statement of Additional
Information.
PURCHASES OF OPTIONS
The Small Cap Equity Fund may purchase call options. A call option
gives the purchaser of the option the right to buy, and a writer has the
obligation to sell, the underlying security at the stated exercise price at any
time prior to the expiration of the option, regardless of the market price of
the security. The premium paid to the writer is consideration for undertaking
the obligations under the option contract. Call options purchased by the Fund
will be valued at the last sale price, or in the absence of such a price, at the
mean between bid and asked price.
B-3
<PAGE> 45
The Small Cap Equity Fund may also purchase index options. Index
options (or options on securities indices) are similar in many respects to
options on securities, except that an index option gives the holder the right to
receive, upon exercise, cash instead of securities, if the closing level of the
securities index upon which the option is based is greater than the exercise
price of the option.
Purchasing options is a specialized investment technique that entails a
substantial risk of a complete loss of the amounts paid as premiums to writers
of options. The Small Cap Equity Fund will purchase call options and index
options only when its total investment in such options immediately after such
purchase, will not exceed 5% of its total assets.
COVERED CALLS
The Small Cap Equity Fund may write (sell) "covered" call options and
purchase options to close out options previously written by the Fund. Such
options must be listed on a national securities exchange. The purpose of the
Fund in writing covered call options is to generate additional premium income.
This premium income will serve to enhance the Fund's total return and will
reduce the effect of any price decline of the security involved in the option.
A call option gives the holder (buyer) the "right to purchase" a
security at a specified price (the exercise price) at any time until a certain
date (the expiration date). So long as the obligation of the writer of a call
option continues, the writer may be assigned an exercise notice by the
broker-dealer through whom such option was sold, requiring the writer to deliver
the underlying security against payment of the exercise price. This obligation
terminates upon the expiration of the call option, or such earlier time at which
the writer effects a closing purchase transaction by purchasing an option
identical to that previously sold. To secure the writer's obligation to deliver
the underlying security in the case of a call option, subject to the rules of
the Options Clearing Corporation, a writer is required to deposit in escrow the
underlying security or other assets in accordance with such rules. The Small Cap
Equity Fund will write only covered call options. This means that the Fund will
only write a call option on a security which the Fund already owns. In order to
comply with the requirements of the securities laws in several states, the Fund
will not write a covered call option if, as a result, the aggregate market value
of all portfolio securities covering call options or currencies subject to put
options exceeds 25% of the market value of the Fund's net assets.
Portfolio securities on which call options may be written will be
purchased solely on the basis of investment considerations consistent with the
Fund's investment objectives. The writing of covered call options is a
conservative investment technique believed to involve relatively little risk (in
contrast to the writing of naked or uncovered options, which the Fund will not
do), but capable of enhancing the Fund's total return. When writing a covered
call option, the Fund, in return for the premium, gives up the opportunity for
profit from a price increase in the underlying security above the exercise
price, but conversely retains the risk of
B-4
<PAGE> 46
loss should the price of the security decline. Unlike when the Fund owns
securities not subject to an option, the Fund has no control over when it may be
required to sell the underlying securities, since it may be assigned an exercise
notice at any time prior to the expiration of its obligation as a writer. If a
call option which the Fund has written expires, the Fund will realize a gain in
the amount of the premium; however, such gain may be offset by a decline in the
market value of the underlying security during the option period. If the call
option is exercised, the Fund will realize a gain or loss from the sale of the
underlying security. The security covering the call will be maintained in a
segregated account of the Fund's custodian. The Small Cap Equity Fund does not
consider a security covered by a call to be "pledged" as that term is used in
the Fund's policy which limits the pledging or mortgaging of its net assets.
The premium received is the fair market value of an option. The premium
the Fund will receive from writing a call option will reflect, among other
things, the current market price of the underlying security, the relationship of
the exercise price to such market price, the historical price volatility of the
underlying security, and the length of the option period. Once the decision to
write a call option has been made, the Investment Adviser in determining whether
a particular call option should be written on a particular security, will
consider the reasonableness of the anticipated premium and the likelihood that a
liquid secondary market will exist for those options. The premium received by
the Fund for writing covered call options will be recorded as a liability in the
Fund's statement of assets and liabilities. This liability will be adjusted
daily to the option's current market value, which will be the latest sale price
at the time at which the net asset value per Share of the Fund is computed
(close of the New York Stock Exchange ("NYSE")), or, in the absence of such
sale, the latest asked price. The liability will be extinguished upon expiration
of the option, the purchase of an identical option in the closing transaction,
or delivery of the underlying security upon the exercise of the option.
Closing transactions will be effected in order to realize a profit on
an outstanding call option, to prevent an underlying security from being called,
or to permit the sale of the underlying security. Furthermore, effecting a
closing transaction will permit the Fund to write another call option on the
underlying security with either a different exercise price or expiration date or
both. If the Fund desires to sell a particular security from its portfolio on
which it has written a call option, it will seek to effect a closing transaction
prior to, or concurrently with, the sale of the security. There is, of course,
no assurance that the Fund will be able to effect such closing transactions at a
favorable price. If the Fund cannot enter into such a transaction, it may be
required to hold a security that it might otherwise have sold, in which case it
would continue to be at market risk on the security. This could result in higher
transaction costs. The Fund will pay transaction costs in connection with the
writing of options to close out previously written options. Such transaction
costs are normally higher than those applicable to purchases and sales of
portfolio securities.
B-5
<PAGE> 47
Call options written by the Fund will normally have expiration dates of
less than nine months from the date written. The exercise price of the options
may be below, equal to, or above the current market values of the underlying
securities at the time the options are written. From time to time, the Fund may
purchase an underlying security for delivery in accordance with an exercise
notice of a call option assigned to it, rather than delivering such security
from its portfolio. In such cases, additional costs will be incurred.
The Fund will realize a profit or loss from a closing purchase
transaction if the cost of the transaction is less or more than the premium
received from the writing of the option. Because increases in the market price
of a call option will generally reflect increases in the market price of the
underlying security, any loss resulting from the repurchase of a call option is
likely to be offset in whole or in part by appreciation of the underlying
security owned by the Fund.
PUTS
The Small Cap Equity Fund may acquire "puts" with respect to securities
held in their portfolios. A put is a right to sell a specified security (or
securities) within a specified period of time at a specified exercise price.
The amount payable to the Fund upon its exercise of a "put" on debt
securities is normally (i) the Fund's acquisition cost of the securities
(excluding any accrued interest which the portfolio paid on their acquisition),
less any amortized market premium or plus any amortized market or original issue
discount during the period the Fund owned the securities, plus (ii) all interest
accrued on the securities since the last interest payment date during that
period.
Puts may be acquired by the Fund to facilitate the liquidity of its
portfolio assets. Puts may also be used to facilitate the reinvestment of the
Fund's assets at a rate of return more favorable than that of the underlying
security or to limit the potential losses involved in a decline in an equity
security's market value.
The Fund intends to enter into puts only with dealers, banks, and
broker-dealers which, in the Investment Adviser's opinion, present minimal
credit risks.
FUTURES CONTRACTS
The Small Cap Equity Fund may enter into contracts for the future
delivery of securities and futures contracts based on a specific security, class
of securities or an index, purchase or sell options on any such futures
contracts, and engage in related closing transactions. A futures contract on a
securities index is an agreement obligating either party to pay, and entitling
the other party to receive, while the contract is outstanding, cash payments
based on the level of a specified securities index.
B-6
<PAGE> 48
When interest rates are expected to rise or market values of portfolio
securities are expected to fall, the Fund can seek through the sale of futures
contracts to offset a decline in the value of its portfolio securities. When
interest rates are expected to fall or market values are expected to rise, the
Fund, through the purchase of such contracts, can attempt to secure better rates
or prices for the Fund than might later be available in the market when it
effects anticipated purchases.
The acquisition of put and call options on futures contracts will,
respectively, give the Fund the right (but not the obligation), for a specified
price, to sell or to purchase the underlying futures contract, upon exercise of
the option, at any time during the option period.
Futures transactions involve brokerage costs and require the Fund to
segregate assets to cover contracts that would require it to purchase
securities. The Fund may lose the expected benefit of futures transactions if
interest rates or securities prices move in an unanticipated manner. Such
unanticipated changes may also result in poorer overall performance than if the
Fund had not entered into any futures transactions. In addition, the value of
the Fund's futures positions may not prove to be perfectly or even highly
correlated with the value of its portfolio securities, limiting the Fund's
ability to hedge effectively against interest rate and/or market risk and giving
rise to additional risks. There is no assurance of liquidity in the secondary
market for purposes of closing out futures positions.
Aggregate initial margin deposits for futures contracts, and premiums
paid for related options, may not exceed 5% of the Small Cap Equity Fund's total
assets, and the value of securities that are the subject of such futures and
options (both for receipt and delivery) may not exceed one-third of the market
value of the Small Cap Equity Fund's total assets. Futures transactions will be
limited to the extent necessary to maintain the Small Cap Equity Fund's
qualification as a regulated investment company ("RIC").
MORTGAGE-RELATED SECURITIES
The Fund may, consistent with its investment objective, restrictions
and policies, invest in mortgage-related securities issued or guaranteed by the
U.S. Government, its agencies or instrumentalities. The Small Cap Equity Fund
will limit its total investment in such securities to 5% or less of net assets.
Mortgage-related securities, for purposes of the Fund's Prospectus and
this Statement of Additional Information, represent pools of mortgage loans
assembled for sale to investors by various governmental agencies such as the
Government National Mortgage Association and government-related organizations
such as the Federal National Mortgage Association and the Federal Home Loan
Mortgage Corporation, as well as by nongovernmental issuers such as commercial
banks, savings and loan institutions, mortgage bankers, and private mortgage
insurance companies. Although certain mortgage-related securities are guaranteed
by a third party or otherwise similarly secured, the market value of
B-7
<PAGE> 49
the security, which may fluctuate, is not so secured. If the Fund purchases a
mortgage-related security at a premium, that portion may be lost if there is a
decline in the market value of the security whether resulting from changes in
interest rates or prepayments in the underlying mortgage collateral. As with
other interest-bearing securities, the prices of such securities are inversely
affected by changes in interest rates. However, though the value of a
mortgage-related security may decline when interest rates rise, the converse is
not necessarily true since in periods of declining interest rates the mortgages
underlying the securities are prone to prepayment. For this and other reasons, a
mortgage-related security's stated maturity may be shortened by unscheduled
prepayments on the underlying mortgages and, therefore, it is not possible to
predict accurately the security's return to the Fund. In addition, regular
payments received in respect of mortgage-related securities include both
interest and principal. No assurance can be given as to the return the Fund will
receive when these amounts are reinvested.
There are a number of important differences among the agencies and
instrumentalities of the U.S. government that issue mortgage-related securities
and among the securities that they issue. Mortgage-related securities issued by
the Government National Mortgage Association ("GNMA") include GNMA Mortgage
Pass-Through Certificates (also known as "Ginnie Maes") which are guaranteed as
to the timely payment of principal and interest by GNMA and such guarantee is
backed by the full faith and credit of the United States. GNMA is a wholly-owned
U.S. government corporation within the Department of Housing and Urban
Development. GNMA certificates also are supported by the authority of GNMA to
borrow funds from the U.S. government to make payments under its guarantee.
Mortgage-related securities issued by the Federal National Mortgage Association
("FNMA") include FNMA Guaranteed Mortgage Pass-Through Certificates (also known
as "Fannie Maes") which are solely the obligations of the FNMA and are not
backed by or entitled to the full faith and credit of the United States. The
FNMA is a government-sponsored organization owned entirely by private
stock-holders. Fannie Maes are guaranteed as to timely payment of principal and
interest by FNMA. Mortgage-related securities issued by the Federal Home Loan
Mortgage Corporation ("FHLMC") include FHLMC Mortgage Participation Certificates
(also known as "Freddie Macs" or "PCs"). The FHLMC is a corporate
instrumentality of the United States, created pursuant to an Act of Congress,
which is owned entirely by Federal Home Loan Banks. Freddie Macs are not
guaranteed by the United States or by any Federal Home Loan Banks and do not
constitute a debt or obligation of the United States or of any Federal Home Loan
Bank. Freddie Macs entitle the holder to timely payment of interest, which is
guaranteed by the FHLMC. The FHLMC guarantees either ultimate collection or
timely payment of all principal payments on the underlying mortgage loans. When
the FHLMC does not guarantee timely payment of principal, FHLMC may remit the
amount due on account of its guarantee of ultimate payment of principal at any
time after default on an underlying mortgage, but in no event later than one
year after it becomes payable.
B-8
<PAGE> 50
FOREIGN INVESTMENTS
The Small Cap Equity Fund may, subject to its investment objectives,
restrictions and policies, invest in certain obligations or securities of
foreign issuers. Permissible investments may consist of obligations of foreign
branches, agencies or subsidiaries of U.S. banks and of foreign banks, including
European Certificates of Deposit, European Time Deposits, Canadian Time Deposits
and Yankee Certificates of Deposit, and investments in Canadian Commercial
Paper, foreign securities and Europaper. These instruments may subject the Fund
to investment risks that differ in some respects from those related to
investments in obligations of U.S. domestic issuers. Such risks include future
adverse political and economic developments, the possible imposition of
withholding taxes on interest or other income, possible seizure,
nationalization, or expropriation of foreign deposits, the possible
establishment of exchange controls or taxation at the source, greater
fluctuations in value due to changes in exchange rates, or the adoption of other
foreign governmental restrictions which might adversely affect the payment of
principal and interest on such obligations. Such investments may also entail
higher custodial fees and sales commissions than domestic investments. Foreign
issuers of securities or obligations are often subject to accounting treatment
and engage in business practices different from those respecting domestic
issuers of similar securities or obligations. Foreign branches of U.S. banks and
foreign banks may be subject to less stringent reserve requirements than those
applicable to domestic branches of U.S. banks. Special U.S. tax considerations
may apply to the Fund's foreign investments.
WHEN-ISSUED SECURITIES
As discussed in the Prospectus, the Fund may purchase securities on a
"when-issued" basis. When the Fund engages in "when-issued" transactions, it
relies on the seller to consummate the trade. Failure of the seller to do so may
result in the Fund's incurring a loss or missing the opportunity to obtain a
price considered to be advantageous.
SECURITIES LENDING
The Fund may lend its portfolio securities to broker-dealers, banks or
institutional borrowers of securities. The Fund must receive 100% collateral in
the form of cash or U.S. government securities. This collateral must be valued
daily by the Fund's Investment Adviser and should the market value of the loaned
securities increase, the borrower must furnish additional collateral to the
Fund. During the time portfolio securities are on loan, the borrower will pay
the Fund any dividends or interest paid on such securities. Loans will be
subject to termination by the Fund or the borrower at any time. While the Fund
will not have the right to vote securities in loan, it intends to terminate the
loan and regain the right to vote if that is considered important with respect
to the investment. The Fund will only enter into loan arrangements with
broker-dealers, banks or other institutions which the Investment
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<PAGE> 51
Adviser has determined are creditworthy under guidelines established by the
Board of Trustees. The Fund will limit securities loans to 33a% of the value of
its total net assets.
REPURCHASE AGREEMENTS
Securities held by the Fund may be subject to repurchase agreements.
Under the terms of a repurchase agreement, the Fund would acquire securities
from a financial institution such as a member bank of the Federal Deposit
Insurance Corporation or a registered broker-dealer, which the Investment
Adviser deems creditworthy under guidelines approved by the Board of Trustees,
subject to the seller's agreement to repurchase such securities at a mutually
agreed-upon date and price. The repurchase price would generally equal the price
paid by the Fund plus interest negotiated on the basis of current short-term
rates, which may be more or less than the rate on the underlying portfolio
securities. The seller under a repurchase agreement will be required to maintain
the value of collateral held pursuant to the agreement at not less than the
repurchase price (including accrued interest). If the seller were to default on
its repurchase obligation or become insolvent, the Fund would suffer a loss to
the extent that the proceeds from a sale of the underlying portfolio securities
were less than the repurchase price under the agreement, or to the extent that
the disposition of such securities by the Fund were delayed pending court
action. Additionally, there is no controlling legal precedent confirming that
the Fund would be entitled, as against a claim by such seller or its receiver or
trustee in bankruptcy, to retain the underlying securities, although the Board
of Trustees of the Fund believes that, under the regular procedures normally in
effect for custody of the Fund's securities subject to repurchase agreements and
under applicable federal laws, a court of competent jurisdiction would rule in
favor of the Fund if presented with the question. Securities subject to
repurchase agreements will be held by each Fund's Custodian, Sub-Custodian, or
in the Federal Reserve/Treasury book-entry system. Repurchase agreements are
considered to be loans by an investment company under the Investment Company Act
of 1940, as amended (the "1940 Act").
INVESTMENT RESTRICTIONS
Unless otherwise specifically noted, the following investment
restrictions may be changed only by a vote of a majority of the outstanding
Shares of the Fund (as defined under "GENERAL INFORMATION--Miscellaneous" in the
Fund's Prospectus).
The Small Cap Equity Fund may not:
1. Purchase securities on margin, sell securities short, or participate
on a joint or joint and several basis in any securities trading account.
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<PAGE> 52
2. Underwrite the securities of other issuers except to the extent that
the Fund may be deemed to be an underwriter under certain securities laws in the
disposition of "restricted securities."
3. Purchase or sell commodities or commodity contracts, except that the
Fund may invest in futures contracts if, immediately thereafter, the aggregate
initial margin deposits for futures contracts, and premium paid for related
options, does not exceed 5% of the Fund's total assets and the value of
securities that are the subject of such futures and options (both for receipt
and delivery) does not exceed one-third of the value of the Fund's total assets.
4. Purchase participation or other direct interests in oil, gas or
mineral exploration or development programs or leases (although investments by
the Fund in marketable securities of companies engaged in such activities are
not hereby precluded).
5. Invest in any issuer for purposes of exercising control or
management.
6. Purchase or retain securities of any issuer if the officers or
Trustees of the Fund or the officers or directors of its Investment Adviser
owning beneficially more than one-half of 1% of the securities of such issuer
together own beneficially more than 5% of such securities.
7. Invest more than 5% of the Fund's total assets in the securities of
issuers which together with any predecessors have a record of less than three
years of continuous operation.
8. Purchase or sell real estate, including limited partnership
interests, (however, the Fund, may, to the extent appropriate to its investment
objective, purchase securities secured by real estate or interests therein or
securities issued by companies investing in real estate or interests therein).
PORTFOLIO TURNOVER
The portfolio turnover rate for the Fund is calculated by dividing the
lesser of purchases or sales of portfolio securities for the year by the monthly
average value of the portfolio securities. The calculation excludes all
securities whose maturities, at the time of acquisition, were one year or less.
Fund turnover may vary greatly from year to year as well as within a particular
year, and may also be affected by cash requirements for redemptions of shares
and by requirements which enable the Fund to receive certain favorable tax
treatments. Fund turnover will not be a limiting factor in making portfolio
decisions. High turnover rates will generally result in higher transaction costs
to the Fund and may result in
B-11
<PAGE> 53
additional tax consequences (including an increase in short-term capital gains
which are generally taxed at ordinary income tax rates) to the Fund's
Shareholders.
ADDITIONAL TAX INFORMATION CONCERNING THE FUND
It is the policy of the Fund to meet the requirements of Subchapter M
of the Internal Revenue Code of 1986, as amended (the "Code"). By following such
policy, the Fund expects to eliminate or reduce to a nominal amount the federal
income taxes to which it may be subject.
In order to qualify as a regulated investment company (a "RIC") under
Subchapter M the Fund must, among other things, (1) derive at least 90% of its
gross income from dividends, interest, payments with respect to securities
loans, and gains from the sale or other disposition of stock or securities,
foreign currencies or other income (including gains from options, futures or
forward contracts) derived with respect to its business of investing in stock,
securities or currencies, and (2) diversify its holdings so that at the end of
each quarter of its taxable year (i) at least 50% of the market value of the
Fund's assets is represented by cash or cash items, U.S. government securities,
securities of other RICs and other securities limited, in respect of any one
issuer, to an amount not greater than 5% of the value of the Fund's assets and
10% of the outstanding voting securities of such issuer, and (ii) not more than
25% of the value of its assets is invested in the securities of any one issuer
(other than U.S. government securities or securities of other RICs) or of two or
more issuers that the Fund controls and that are engaged in the same, similar or
related trades or businesses. These requirements may limit the range of the
Fund's investments. If the Fund qualifies as a RIC, it will not be subject to
federal income tax on the part of its net investment income and net realized
capital gains, if any, that it distributes to shareholders, provided the Fund
distributes during its taxable year at least 90% of the sum of its taxable net
investment income, its net tax-exempt income and the excess, if any, of net
short-term capital gains over net long-term capital losses for such year. The
Fund intends to make sufficient distributions to Shareholders to meet this
requirement.
Distributions from the Fund (other than exempt-interest dividends, as
discussed below) generally will be taxable to shareholders as ordinary income to
the extent derived from the Fund's investment income and short-term capital
gains. Distributions of long-term capital gains (generally subject to a 20% tax
rate) will be taxable to shareholders as such, regardless of how long a
shareholder has held shares of the Fund.
Dividends and distributions on the Fund's shares are generally subject
to federal income tax as described herein to the extent they do not exceed the
Fund's realized income and gains, even though such dividends and distributions
may economically represent a return of a particular shareholder's investment.
Such distributions are likely to occur in respect of shares purchased at a time
when the Fund's net asset value reflects gains that are either unrealized,
B-12
<PAGE> 54
or realized but not distributed. Such realized gains may be required to be
distributed even when the Fund's net asset value also reflects unrealized
losses.
The Code imposes a non-deductible 4% excise tax on RICs that do not
distribute in each calendar year (regardless of whether they otherwise have a
non-calendar taxable year) an amount equal to 98% of their "ordinary income" (as
defined) for the calendar year plus 98% of their capital gain net income for the
one-year period ending on October 31 of such calendar year, plus any
undistributed amounts from the prior year. For the foregoing purposes, the Fund
is treated as having distributed any amount on which it is subject to income tax
for any taxable year ending in such calendar year. A dividend paid to
Shareholders by the Fund in January of a year generally is deemed to have been
paid by the Fund on December 31 of the preceding year, if the dividend was
declared and payable to Shareholders of record on a date in October, November or
December of that preceding year. If distributions during a calendar year by the
Fund did not meet the 98% threshold, the Fund would be subject to this 4% excise
tax on the undistributed amounts. The Fund generally intends to make
distributions sufficient to avoid the imposition of this 4% excise tax.
The Fund's transactions in futures contracts, options, and foreign
currency denominated securities, and certain other investment and hedging
activities of the Fund, will be subject to special tax rules. These rules may
accelerate income to the Fund, defer losses to the Fund, cause adjustments in
the holding periods of the Fund's assets, convert short-term capital losses into
long-term capital losses, convert long-term capital gains into short-term
capital gains, or otherwise affect the character of the Fund's income.
Consequently, the amount, timing, and character of distributions to Shareholders
could be affected. Income earned as a result of these transactions would, in
general, not be eligible for the dividends-received deduction or for treatment
as exempt-interest dividends when distributed to Shareholders. The Fund will
endeavor to make any available elections pertaining to these transactions in a
manner believed to be in the best interest of the Fund.
The Fund will be required in certain cases to withhold and remit to the
U.S. Treasury 31% of taxable dividends and other distributions paid to any
Shareholder who has provided either an incorrect tax identification number or no
number at all, or who is subject to withholding by the Internal Revenue Service
for failure properly to include on his or her tax return payments of interest or
dividends. This withholding, known as back-up withholding, is not an additional
tax, and any amounts withheld may be credited against the Shareholder's ultimate
U.S. tax liability.
The foregoing is only a summary of some of the important federal tax
considerations generally affecting purchasers of Shares of the Fund. No attempt
is made to present a detailed explanation of the federal income tax treatment of
the Fund or its Shareholders, and this discussion is not intended as a
substitute for careful tax planning. Accordingly, potential purchasers of shares
of the Fund are urged to consult their tax advisers with specific
B-13
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reference to their own tax situation, including the potential application of
foreign, state and local taxes.
VALUATION
Except as noted below, the Small Cap Equity Fund will value securities
for which the principal market is a securities exchange, at their fair market
values based upon the latest available sales price or, absent such a price, by
reference to the latest available bid prices in the principal market in which
such securities are normally traded. Securities, the principal market for which
is not a securities exchange, will be valued based on bid quotations in such
principal market. Securities and other assets for which quotations are not
readily available will be valued at their fair market value, as determined in
good faith under procedures established by, and under the general supervision
of, the Board of Trustees . Short-term securities are valued at amortized cost,
which approximates current value.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
Shares in the Fund are sold on a continuous basis by BISYS Fund
Services (the "Distributor"), and the Distributor has agreed to use appropriate
efforts to solicit all purchase orders. As described in the Prospectus, in
addition to purchasing Shares directly from the Distributor, Shares may be
purchased through procedures established by the Distributor in connection with
the requirements of Participating Organizations under the Fund's Distribution
and Shareholder Services Plan. Customers purchasing Shares of the Fund may
include officers, directors, or employees of the Investment Adviser and its
affiliates.
The Fund may suspend the right of redemption or postpone the date of
payment for Shares during any period when (a) trading on the NYSE is restricted
by applicable rules and regulations of the SEC, (b) the NYSE is closed for other
than customary weekend and holiday closings, (c) the SEC has by order permitted
such suspension, or (d) an emergency exists as determined by the SEC.
MANAGEMENT AND SERVICE PROVIDERS OF THE FUNDS
TRUSTEES AND OFFICERS
The names of the trustees of the Fund and the Funds, their addresses,
and principal occupations during the past five years are set forth in each of
the Funds' Prospectuses. The officers of the Fund and the Funds, their
addresses, and principal occupations during the past five years are as follows:
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<PAGE> 56
<TABLE>
<CAPTION>
POSITION(S) HELD PRINCIPAL OCCUPATION
NAME, ADDRESS AND AGE WITH THE FUNDS DURING PAST 5 YEARS
--------------------- ---------------- -------------------
<S> <C> <C>
Walter B. Grimm*, 53 Chairman, President, From June, 1992 to present, employee of
3435 Stelzer Road and Trustee BISYS Fund Services.
Columbus, OH 43219
Alaina V. Metz*, 31 Assistant Secretary From June, 1995 to present, employee of
3435 Stelzer Road BISYS Fund Services; from May 1989 to
Columbus, OH 43219 June 1995, Supervisor, Mutual Fund Legal
Department, Alliance Capital Management.
Joel Engle*, 32 Treasurer From September, 1998 to present, employee
3435 Stelzer Road of BISYS Fund Services; from March, 1995
Columbus, OH 43219 to September, 1998, Vice President, The
Northern Trust Company; from September,
1988 to June 1994, Manager, Ernst & Young LLP.
Jeffrey Cusick*, 39 Vice President and From July, 1995 to present, employee of
3435 Stelzer Road Secretary BISYS Fund Services; from September 1993
Columbus, OH 43219 to July 1995, Assistant Vice President,
Federated Administration Services; from
1989 to September 1993, Client Services
Manager, Federated Administration
Services.
</TABLE>
- --------------
* Messrs. Grimm, Engle and Cusick and Ms. Moore and Ms. Metz are each
considered to be an "interested person" of the Funds as defined
in the 1940 Act.
B-15
<PAGE> 57
<TABLE>
COMPENSATION TABLE (1)
<CAPTION>
TOTAL
AGGREGATE PENSION OR COMPENSATION
COMPENSATION RETIREMENT FROM THE
FROM THE BENEFITS ESTIMATED AMERICAN
AMERICAN ACCRUED AS ANNUAL PERFORMANCE
NAME OF PERSON, PERFORMANCE PART OF FUND BENEFITS UPON FUNDS PAID TO
POSITION FUNDS EXPENSES RETIREMENT TRUSTEE
--------------- ------------ ------------ ------------- -------------
<S> <C> <C> <C> <C>
Walter B. Grimm $0 None None $0
Michael J. Hall $6,000.00 None None $6,000.00
Perry A. Wimpey $6,000.00 None None $6,000.00
I. Edgar Hendrix $6,000.00 None None $6,000.00
</TABLE>
(1) Figures are for the Funds' fiscal year ended August 31, 1998.
INVESTMENT ADVISER AND SUB-ADVISER
Investment advisory services are provided to each of the Funds by Bank
of Oklahoma, N.A. ("BOK" or "Investment Adviser"), pursuant to an Investment
Advisory Agreement dated October 1, 1994 (hereinafter referred to as the
"Advisory Agreement").
Under the Advisory Agreement, the Investment Adviser has agreed to
provide to the Funds the investment advisory services described in the Funds'
Prospectuses. For the services provided and expenses assumed pursuant to the
Advisory Agreement, the Investment Adviser is entitled to receive a fee from
each of the Funds, computed daily and paid monthly, based on the lower of (1)
such fee as may, from time to time, be agreed upon in writing by the Funds and
the Investment Adviser or (2) the average daily net assets of each such Fund as
follows: the U.S. Treasury Fund and the Cash Management Fund - forty
one-hundredths of one percent (0.40%) annually; the Equity Fund and the Growth
Equity Fund - sixty-nine one-hundredths of one percent (0.69%) annually; the
Balanced Fund -seventy-four one-hundredths of one percent (0.74%) annually; the
Bond Fund, the Intermediate Bond Fund, the Intermediate Tax-Free Bond Fund and
the Short-Term Income Fund - fifty-five one-hundredths of one percent (0.55%)
annually; and the Small Cap Equity Fund - sixty-nine one-hundredths of one
percent (0.69%) annually.
For its investment advisory services during the fiscal year ending
August 31, 1998, BOK received $1,495,245 with respect to the U.S. Treasury Fund;
$1,630,192 with respect to the Cash Management Fund; $162,521, which is $92,870
less than the maximum amount of advisory fees, if charged, with respect to the
Bond Fund; $284,465, which is $162,552 less
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<PAGE> 58
than the maximum amount of advisory fees, if charged, with respect to the
Intermediate Bond Fund; $974,200, which is $370,196 less than the maximum amount
of advisory fees, if charged, with respect to the Equity Fund; $100,362, which
is $57,350 less than the maximum amount of advisory fees, if charged, with
respect to the Intermediate Tax-Free Bond Fund; $188,145, which is $81,755 less
than the maximum amount of advisory fees, if charged, with respect to the
Aggressive Growth Fund; $0, which is $117,712 less than the maximum amount of
advisory fees, if charged, with respect to the Short-Term Income Fund; and
$46,817, which is $236,504 less than the maximum amount of advisory fees, if
charged, with respect to the Balanced Fund. For its investment advisory services
during the period ending August 31, 1998, BOK received $287,102, which is
$109,099 less than the maximum amount of advisory fees if charged, with respect
to the Growth Equity Fund.
For its investment advisory services during the fiscal year ending
August 31, 1997, BOK received $984,884 with respect to the U.S. Treasury Fund;
$1,476,099 with respect to the Cash Management Fund; $114,994, which is $65,711
less than the maximum amount of advisory fees, if charged, with respect to the
Bond Fund; $224,198, which is $128,113 less than the maximum amount of advisory
fees, if charged, with respect to the Intermediate Bond Fund; $604,087, which is
$229,553 less than the amount of advisory fees, if charged, with respect to the
Equity Fund; $95,309, which is $54,462 less than the amount of advisory fees, if
charged, with respect to the Intermediate Tax-Free Bond Fund; $225,838, which is
$85,818 less than the amount of advisory fees, if charged, with respect to the
Aggressive Growth Fund; $0, which is $80,882 less than the amount of advisory
fees, if charged, with respect to the Short-Term Income Fund; and $0, which is
$196,422 less than the amount of advisory fees, if charged, with respect to the
Balanced Fund.
For its investment advisory services during the fiscal year ending
August 31, 1996, BOK received $801,240 with respect to the U.S. Treasury Fund;
$1,238,786 with respect to the Cash Management Fund; $129,467, which is $73,915
less than the maximum amount of advisory fees, if charged, with respect to the
Bond Fund; $227,937, which is $130,084 less than the maximum amount of such
fees, if charged, with respect to the Intermediate Bond Fund; $407,341, which is
$154,982 less than the maximum amount of such fees, if charged, with respect to
the Equity Fund; $101,273, which is $57,916 less than the maximum amount of
advisory fees, if charged, with respect to the Intermediate Tax-Free Bond Fund;
$202,594, which is $77,088 less than the maximum amount of advisory fees, if
charged, with respect to the Aggressive Growth Fund; $0, which is $65,313 less
than the maximum amount of advisory fees, if charged with respect to the
Short-Term Income Fund; and $0 which is $149,330 less than the maximum amount of
advisory fees, if charged with respect to the Balanced Fund.
Sub-investment advisory services are provided to the Cash Management
Fund by AMR Investment Services, Inc. ("Sub-Advisor" or "AMR") pursuant to a
Sub-Investment Advisory Agreement between BOK and AMR dated June 16, 1997
(hereinafter referred to as the "Sub-Advisory Agreement"). For the services
provided and the expenses assumed pursuant to the Sub-Advisory Agreement, AMR is
entitled to receive a fee from BOK, computed daily and
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paid monthly, at the annual rate of not less than fifteen one-hundredths of one
percent (0.15%) nor more than forty one-hundredths of one percent (0.40%) of the
average daily net assets of the Cash Management Fund.
For its sub-advisory services during the fiscal year ending August 31,
1998, AMR received $954,195 with respect to the Cash Management Fund. For its
sub-advisory services during the fiscal year ending August 31, 1997, AMR
received $553,537 with respect to the Cash Management Fund.
The Investment Adviser may periodically set its fees at less than the
maximum allowable amount with respect to any Fund it serves in order to increase
the net income of that Fund available for distribution as dividends. For
information on such voluntary reductions undertaken for the period ended August
31, 1998, concerning a particular Fund, see "MANAGEMENT OF THE FUND - Investment
Adviser" in the Prospectus pertaining to such Fund.
Unless sooner terminated, the Advisory Agreement will continue in
effect until August 1, 1999. The Advisory Agreement will continue in effect as
to a particular Fund for successive one-year terms after the aforementioned
date, if such continuance is approved at least annually by the Funds' Board of
Trustees or by vote of a majority of the outstanding voting Shares of such Fund
(as defined under "GENERAL INFORMATION--Miscellaneous" in the Funds'
Prospectuses), and a majority of the Trustees who are not parties to the
Advisory Agreement, or interested persons (as defined in 1940 Act) of any party
to the Advisory Agreement by votes cast in person at a meeting called for such
purpose.
The Sub-Advisory Agreement between BOK and AMR provides that unless
sooner terminated, it will continue in effect until August 1, 1999 and for
successive one-year terms thereafter, provided that such continuance is approved
annually in the manner set forth above. The Advisory and Sub-Advisory Agreements
are terminable as to a particular Fund at any time on 60 days' written notice
without penalty by the Trustees, by vote of a majority of the outstanding voting
Shares of that Fund, or by the Investment Adviser or the Sub-Adviser, as the
case may be. The Advisory and Sub-Advisory Agreements also terminate
automatically in the event of any assignment, as defined in the 1940 Act.
The Advisory and Sub-Advisory Agreements provide that the Investment
Adviser or the Sub-Adviser, as the case may be, shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Funds in
connection with the performance of the respective Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith, or gross negligence on the part of the respective provider of services to
the Funds in the performance of its duties, or from reckless disregard by it of
its duties and obligations thereunder.
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From time to time, advertisements, supplemental sales literature and
information furnished to present or prospective shareholders of the Funds may
include descriptions of the Investment Adviser or Sub-Adviser including, but not
limited to, (i) descriptions of the adviser's operations; (ii) descriptions of
certain personnel and their functions; and (iii) statistics and rankings related
to the adviser's operations.
DISTRIBUTION
Shares of the Funds are sold on a continuous basis by the Distributor
for the Funds. Under the Funds' Amended and Restated Distribution and
Shareholder Services Plan (the "Distribution Plan"), each of the Funds will pay
a monthly distribution fee to the Distributor as compensation for its services
in connection with the Distribution Plan at an annual rate equal to twenty-five
one hundredths of one percent (0.25%) of its average daily net assets. The
Distributor may use the distribution fee to provide distribution assistance with
respect to the Funds' Shares or to provide Shareholder services to the holders
of the Funds' Shares. The Distributor may also use the distribution fee (i) to
pay financial institutions and intermediaries (such as insurance companies, and
investment counselors, but not including banks), broker-dealers, and the
Distributor's affiliates and subsidiaries compensation for services or
reimbursement of expenses incurred in connection with distribution assistance or
(ii) to pay banks, other financial institutions and intermediaries,
broker-dealers, and the Distributor's affiliates and subsidiaries compensation
for services or reimbursement of expenses incurred in connection with the
provision of Shareholder services. All payments by the Distributor for
distribution assistance or Shareholder services under the Distribution Plan will
be made pursuant to an agreement between the Distributor and such bank, other
financial institution or intermediary, broker-dealer, or affiliate or subsidiary
of the Distributor (a "Servicing Agreement"; banks, other financial institutions
and intermediaries, broker-dealers, and the Distributor's affiliates and
subsidiaries which may enter into a Servicing Agreement are hereinafter referred
to individually as a "Participating Organization"). A Servicing Agreement will
relate to the provision of distribution assistance in connection with the
distribution of the Funds' Shares to the Participating Organization's customers
on whose behalf the investment in such Shares is made and/or to the provision of
Shareholder services rendered to the Participating Organization's customers
owning the Funds' Shares. Under the Distribution Plan, a Participating
Organization may include the Funds' Advisers or their affiliates. A Servicing
Agreement entered into with a bank (or any of its subsidiaries or affiliates)
will contain a representation that the bank (or subsidiary or affiliate)
believes that it possesses the legal authority to perform the services
contemplated by the Servicing Agreement without violation of applicable banking
laws (including the Glass-Steagall Act).
The distribution fee will be payable without regard to whether the
amount of the fee is more or less than the actual expenses incurred in a
particular year by the Distributor in connection with distribution assistance or
Shareholder services rendered by the Distributor itself or incurred by the
Distributor pursuant to the Servicing Agreements entered into under the
Distribution Plan. If the amount of the distribution fee is greater than the
Distributor's
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actual expenses incurred in a particular year (and the Distributor
does not waive that portion of the distribution fee), the Distributor will
realize a profit in that year from the distribution fee. If the amount of the
distribution fee is less than the Distributor's actual expenses incurred in a
particular year, the Distributor will realize a loss in that year under the
Distribution Plan and will not recover from the Funds the excess of expenses for
the year over the distribution fee, unless actual expenses incurred in a later
year in which the Distribution Plan remains in effect were less than the
distribution fee paid in that later year. The Distributor may periodically waive
all or a portion of the distribution fee to increase the net income attributable
to a Fund available for distribution as dividends to the Fund's Shareholders. To
lower operating expenses, the Distributor may voluntarily reduce its fees under
the Distribution Plan. For information on such voluntary reductions concerning a
particular fund, see "DISTRIBUTION" in the Prospectus pertaining to such Fund.
Under the Distribution Plan during the fiscal year ended August 31,
1998, the Distributor received the maximum amount receivable under the Plan with
respect to the following Funds and in the following amounts: $116,086 with
respect to the Bond Fund; $203,189 with respect to the Intermediate Bond Fund;
$487,100 with respect to the Equity Fund; and $107,572 with respect to the
Aggressive Growth Fund. Under the Distribution Plan during the fiscal year ended
August 31, 1998, the Distributor waived its entire fee with respect to the
following Funds and in the following amounts: $934,531 with respect to the U.S.
Treasury Fund; $1,018,870 with respect to the Cash Management Fund; $71,687 with
respect to the Intermediate Tax-Free Bond Fund; $95,717 with respect to the
Balanced Fund; and $53,506 with respect to the Short-Term Income Fund. Under the
Distribution Plan during the period ended August 31, 1998, the Distributor
received the maximum amount receivable under the Plan, $143,551 with respect to
the Growth Equity Fund.
Substantially all of the amount received by the Distributor under the
Distribution Plan during the last fiscal year, the period from September 1, 1997
to August 31, 1998, was spent on compensation to dealers. BISYS retained 0.56%
and spent this amount on printing and mailing of prospectuses. The total amount
spent on compensation to dealers during the last fiscal year was $1,043,016. The
total amount retained by BISYS during the last fiscal year was $5,885.
GLASS-STEAGALL ACT
In 1971 the United States Supreme Court held in Investment Company
Institute v. Camp that the federal statute commonly referred to as the
Glass-Steagall Act prohibits a national bank from operating a fund for the
collective investment of managing agency accounts. Subsequently, the Board of
Governors of the Federal Reserve System (the "Board") issued a regulation and
interpretation to the effect that the Glass-Steagall Act and such decision: (a)
forbid a bank holding company registered under the Federal Bank Holding Company
Act of 1956 (the "Holding Company Act") or any non-bank affiliate thereof from
sponsoring, organizing, or exerting control of a registered, open-end investment
company
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<PAGE> 62
continuously engaged in the issuance of its shares, but (b) do not
prohibit such a holding company or affiliate from acting as Investment Adviser,
transfer agent, and custodian to such an investment company. In 1981, the United
States Supreme Court held in Board of Governors of the Federal Reserve System v.
Investment Company Institute that the Board did not exceed its authority under
the Holding Company Act when it adopted its regulation and interpretation
authorizing bank holding companies and their non-bank affiliates to act as
investment advisers to registered closed-end investment companies. In the Board
of Governors case, the Supreme Court also stated that if a national bank
complied with the restrictions imposed by the Board in its regulation and
interpretation authorizing bank holding companies and their non-bank affiliates
to act as investment advisers to investment companies, a national bank
performing investment advisory services for an investment company would not
violate the Glass-Steagall Act.
BOK believes that it possesses the legal authority to perform the
investment advisory services that are contemplated by its Investment Advisory
Agreement with the Funds and described in the Prospectuses and this Statement of
Additional Information without violation of the Glass-Steagall Act. Future
changes in either federal or state statutes and regulations relating to the
permissible activities of banks or bank holding companies and the subsidiaries
or affiliates of those entities, as well as further judicial or administrative
decisions or interpretations of present and future statutes and regulations,
could prevent or restrict BOK, from continuing to perform such services for the
Funds. Depending upon the nature of any changes in the services which could be
provided by BOK, the Board of Trustees of the Funds would review the Funds'
relationship with BOK, and consider taking all action necessary in the
circumstances.
Should future legislative, judicial, or administrative action prohibit
or restrict the proposed activities of BOK, or other banks serving as
Participating Organizations under the Funds' Distribution and Shareholder
Services Plan, in connection with Customer purchases of Shares of the Funds,
such banks may be required to alter materially or discontinue the services
offered by them to Customers under the Distribution and Shareholder Services
Plan. It is not anticipated, however, that any change in the Funds' Distribution
and Shareholder Services Plan would affect its net asset value per Share or
result in financial losses to any Customer.
PORTFOLIO TRANSACTIONS
Pursuant to the Advisory and Sub-Advisory Agreements, subject to the
general supervision of the Board of Trustees of the Funds and in accordance with
each Fund's investment objective, policies and restrictions, which securities
are to be purchased and sold by each such Fund and which brokers are to be
eligible to execute its portfolio transactions. Purchases and sales of portfolio
securities with respect to the Money Market Funds and the Bond Investment Funds
usually are principal transactions in which portfolio securities are purchased
directly from the issuer or from an underwriter or market maker for the
securities. Purchases from underwriters of portfolio securities include a
commission or concession paid by the issuer to the underwriter and purchases
from dealers serving as market makers may include the spread between the bid and
asked price. Transactions with respect to the Equity
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Investment Funds and the Small Cap Equity Fund on stock exchanges (other than
certain foreign stock exchanges) involve the payment of negotiated brokerage
commissions. Transactions in the over-the-counter market are generally principal
transactions with dealers. With respect to the over-the-counter market, the
Funds, where possible, will deal directly with the dealers who make a market in
the securities involved except in those circumstances where better price and
execution are available elsewhere. While the Investment Adviser and Sub-Adviser
generally seek competitive spreads or commissions, the Funds may not necessarily
pay the lowest spread or commission available on each transaction, for reasons
discussed below.
During the fiscal year ended August 31, 1998, the Equity Fund paid
aggregate brokerage commissions in the amount of $279,771; the Aggressive Growth
Fund paid aggregate brokerage commissions in the amount of $118,045; the
Balanced Fund paid aggregate brokerage commissions in the amount of $56,206; and
the Growth Equity Fund paid aggregate brokerage commissions in the amount of
$61,297.
During the fiscal year ended August 31, 1997, the Equity Fund paid
aggregate brokerage commissions in the amount of $212,467; the Aggressive Growth
Fund paid aggregate brokerage commissions in the amount of $37,432; and the
Balanced Fund paid aggregate brokerage commissions in the amount of $26,379.
During the fiscal year ended August 31, 1996, the Equity Fund paid
aggregate brokerage commissions in the amount of $106,593. During the fiscal
year ended August 31, 1996, BOK directed brokerage transactions for the Equity
Fund to brokers because of research services provided in the following amounts:
aggregate transactions -- $90,918; aggregate commissions -- $48,969. During the
fiscal year ended August 31, 1996, the Aggressive Growth Fund paid aggregate
brokerage commissions in the amount of $20,047. During the fiscal year ended
August 31, 1996, BOK directed brokerage transactions for the Aggressive Growth
Fund to brokers because of research services provided in the following amounts:
aggregate transactions -- $20,047; aggregate commissions -- $0. During the
fiscal year ended August 31, 1996 the Balanced Fund paid aggregate brokerage
commissions in the amount of $25,340. BOK directed brokerage transactions for
the Balanced Fund to brokers because of research services provided in the
following amounts: aggregate transactions -- $19,722 and aggregate commissions
- -- $5,618.
Allocation of transactions, including their frequency, to various
dealers is determined by the Investment Adviser and/or Sub-Adviser with respect
to the Funds it serves based on its best judgment and in a manner deemed fair
and reasonable to Shareholders. The primary consideration is prompt execution of
orders in an effective manner at the most favorable price. Subject to this
consideration, dealers who provide supplemental investment research to the
Investment Adviser and Sub-Adviser may receive orders for transactions by the
Funds. Information so received is in addition to and not in lieu of services
required to be performed by the Investment Adviser and Sub-Adviser and does not
reduce the advisory fees payable to the Investment Adviser and Sub-Adviser. Such
information may be useful to the Investment Adviser and Sub-Adviser in serving
both the Funds and other clients and, conversely,
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<PAGE> 64
supplemental information obtained by the placement of business of other clients
may be useful to such adviser in carrying out its obligations to the Funds.
The Funds will not execute portfolio transactions through, acquire
portfolio securities issued by, make savings deposits in, or enter into
repurchase or reverse repurchase agreements with the Investment Adviser or
Sub-Adviser, its Distributor, or their affiliates except as may be permitted
under the 1940 Act, and will not give preference to correspondents of an
Investment Adviser with respect to such transactions, securities, savings
deposits, repurchase agreements, and reverse repurchase agreements.
Investment decisions for each Fund are made independently from those
for the other Funds or any other investment company or account managed by the
Investment Adviser and Sub-Adviser. Any such other investment company or account
may also invest in the same securities as the Funds. When a purchase or sale of
the same security is made at substantially the same time on behalf of a given
Fund and another Fund, investment company or account, the transaction will be
averaged as to price, and available investments allocated as to amount, in a
manner which the Investment Adviser or Sub-Adviser believes to be equitable to
the Fund(s) and such other investment company or account. In some instances,
this investment procedure may adversely affect the price paid or received by a
Fund or the size of the position obtained by a Fund. To the extent permitted by
law, the Investment Adviser or Sub-Adviser may aggregate the securities to be
sold or purchased by it for a Fund with those to be sold or purchased by it for
other Funds or for other investment companies or accounts in order to obtain
best execution. As provided by Investment Advisory and Sub-Advisory Agreements,
in making investment recommendations for the Funds, the Investment Adviser or
Sub-Adviser will not inquire or take into consideration whether an issuer of
securities proposed for purchase or sale by the Funds is a customer of the
Investment Adviser or Sub-Adviser or their respective parents or subsidiaries or
affiliates unless legally required to do so and, in dealing with its commercial
customers, the Investment Adviser or Sub-Adviser and their respective parents,
subsidiaries, and affiliates will not inquire or take into consideration whether
securities of such customers are held by the Funds.
ADMINISTRATOR
BISYS Fund Services ("BISYS") serves as general manager and
administrator (the "Administrator") to each Fund pursuant to the Management and
Administration Agreement with the Funds dated September 5, 1990, as amended and
restated on August 30, 1994 (hereinafter referred to as the "Administration
Agreement"). The Administrator assists in supervising all operations of each
Fund (other than those performed under the Investment Advisory, Sub-Advisory,
Custodian, Fund Accounting, and Transfer Agency Agreements for that Fund). The
Administrator is a broker-dealer registered with the SEC and is a member of the
National Association of Securities Dealers, Inc.
Under the Administration Agreement, the Administrator has agreed to
price the portfolio securities of each Fund and to compute the net asset value
and net income of those Funds on a daily basis, to maintain office facilities
for the Funds, to maintain the Funds'
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<PAGE> 65
financial accounts and records, and to furnish the Funds statistical and
research data, data processing, clerical, accounting, and bookkeeping services,
and certain other services required by the Funds with respect to the Funds. The
Administrator prepares annual and semi-annual reports to the SEC, prepares
federal and state tax returns, prepares filings with state securities
commissions, and generally assists in all aspects of the Funds' operations other
than those performed under the Investment Advisory, Sub-Advisory, Custodian,
Fund Accounting, and Transfer Agency Agreements. Under the Administration
Agreement, the Administrator may delegate all or any part of its
responsibilities thereunder.
The Administrator receives a fee from each Fund for its services
provided and expenses assumed pursuant to the Administration Agreement,
calculated daily and paid monthly, at the annual rate of twenty one hundredths
of one percent (0.20%) of each Fund's average daily net assets. The
Administrator may periodically set its fees at less than the maximum allowable
amount with respect to any Fund in order to increase the net income of one or
more of the Funds available for distribution as dividends. For information on
such voluntary reductions undertaken concerning a particular fund, see
"MANAGEMENT OF THE FUND -Administrator, and Distributor" in the Prospectus
pertaining to such Fund.
For management and administrative services during the fiscal year ended
August 31, 1998, BISYS received $747,624 with respect to the U.S. Treasury Fund;
$815,098 with respect to the Cash Management Fund; $92,870 with respect to the
Bond Fund; $162,552 with respect to the Intermediate Bond Fund; $57,350 with
respect to the Intermediate Tax-Free Bond Fund; $389,681 with respect to the
Equity Fund; $86,058 with respect to the Aggressive Growth Fund; $42,805 with
respect to the Short-Term Income Fund; and $76,574 with respect to the Balanced
Fund. For management and administrative services during the period ended August
31, 1998, BISYS received $114,841 with respect to the Growth Equity Fund.
For management and administrative services during the fiscal year ended
August 31, 1997, BISYS received $492,442 with respect to the U.S. Treasury Fund;
$738,049 with respect to the Cash Management Fund; $65,711 with respect to the
Bond Fund; $128,113 with respect to the Intermediate Bond Fund; $54,462 with
respect to the Intermediate Tax-Free Bond Fund; $241,635 with respect to the
Equity Fund; $90,335 with respect to the Aggressive Growth Fund; $29,412 with
respect to the Short-Term Income Fund; and $53,087 with respect to the Balanced
Fund. As of August 31, 1997, the Growth Equity Fund had not commenced
operations.
For management and administration services during the fiscal year ended
August 31, 1996, BISYS received $400,620 with respect to the U.S. Treasury Fund;
$664,393 with respect to the Cash Management Fund; $73,981 with respect to the
Bond Fund; $130,250 with respect to the Intermediate Bond Fund; $57,869 with
respect to the Intermediate Tax-Free Bond Fund; $162,936 with respect to the
Equity Fund; $81,038 with respect to the Aggressive Growth Fund; $23,727 with
respect to the Short-Term Income Fund; and $40,306 with respect to the Balanced
Fund.
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Unless sooner terminated, the Administration Agreement will continue in
effect until December 31, 1999 and thereafter will automatically continue in
effect for successive three-year periods unless written notice not to renew is
given by the non-renewing party at least sixty days prior to the expiration of
the then-current term. Otherwise, the Administration Agreement is terminable,
with respect to a particular Fund only upon mutual agreement or for "cause" in
either case on not less than sixty days' notice by the Funds' Board of Trustees
or by the Administrator. For purposes of the Administration Agreement, "cause"
means (i) willful misfeasance, bad faith, gross negligence, abandonment, or
reckless disregard on the part of either party with respect to its obligations
and duties set forth herein; (ii) regulatory, administrative, or judicial action
initiated against either party with regard to the violation of any rule,
regulation, order, or law; (iii) the dissolution or liquidation of either party
or other cessation of business other than a reorganization or recapitalization
of such party as an ongoing business; (iv) financial difficulties on the part of
either party which is evidenced by the authorization or commencement of, or
involvement by way of pleading, answer, consent, or acquiescence in, a voluntary
or involuntary case under Title 11 of the United States Code, as, from time to
time, in effect, or any applicable law, other than said Title 11, of any
jurisdiction relating to the liquidation or reorganization of debtors or to the
modification or alteration of the rights of creditors; or (v) any circumstance
which substantially impairs the performance of either party's obligations and
duties as contemplated herein.
The Administration Agreement provides that the Administrator shall not
be liable for any error of judgment or mistake of law or any loss suffered by
the Funds in connection with the matters to which the Agreement relates, except
a loss resulting from willful misfeasance, bad faith, or gross negligence in the
performance of its duties, or from the reckless disregard by it of its
obligations and duties thereunder.
SUB-ADMINISTRATOR
Effective May 12, 1995, BOK became the Sub-Administrator to the Funds
pursuant to an agreement between the Administrator and BOK. Pursuant to this
agreement, BOK assumed many of the Administrator's duties, for which BOK
receives a fee, paid by the Administrator, calculated at an annual rate of five
one-hundredths of one percent (0.05%) of each Fund's average net assets.
For Sub-Administration services during the fiscal year ended August 31,
1998, BOK received fees in the following amounts from the Administrator:
$373,811 with respect to the U.S. Treasury Fund; $407,548 with respect to the
Cash Management Fund; $63,848 with respect to the Bond Fund; $111,754 with
respect to the Intermediate Bond Fund; $39,428 with respect to the Intermediate
Tax-Free Bond Fund; $29,428 with respect to the Short-Term Income Fund; $70,830
with respect to the Balanced Fund; $336,099 with respect to the Equity Fund; and
$74,225 with respect to the Aggressive Growth Fund. For Sub-Administration
services during the period ended August 31, 1998, BOK received fees of $99,050
from the Administrator with respect to the Growth Equity Fund.
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<PAGE> 67
For Sub-Administration services during the fiscal year ended August 31,
1997, BOK received fees in the following amounts from the Administrator:
$123,111 with respect to the U.S. Treasury Fund; $184,512 with respect to the
Cash Management Fund; $16,428 with respect to the Bond Fund; $32,028 with
respect to the Intermediate Bond Fund; $13,616 with respect to the Intermediate
Tax-Free Bond Fund; $7,353 with respect to the Short-Term Income Fund; $13,272
with respect to the Balanced Fund; $60,409 with respect to the Equity Fund; and
$22,584 with respect to the Aggressive Growth Fund. As of August 31, 1997, the
Growth Equity Fund had not commenced operations.
For Sub-Administration services during the fiscal year ended August 31,
1996, BOK received fees in the following amounts from the Administrator:
$100,155 with respect to the U.S. Treasury Fund; $166,098 with respect to the
Cash Management Fund; $18,495 with respect to the Bond Fund; $32,563 with
respect to the Intermediate Bond Fund; $14,468 with respect to the Intermediate
Tax-Free Bond Fund; $5,932 with respect to the Short-Term Income Fund; $9,970
with respect to the Balanced Fund; $40,734 with respect to the Equity Fund; and
$20,259 with respect to the Aggressive Growth Fund.
DISTRIBUTOR
BISYS serves as distributor to each of the Funds pursuant to its
Distribution Agreement with the Funds dated October 1, 1993 (the "Distribution
Agreement"). Unless otherwise terminated, the Distribution Agreement will
continue in effect until August 1, 1999 and thereafter will continue for
successive one-year periods if approved at least annually (i) by the Funds'
Board of Trustees or by the vote of a majority of the outstanding voting Shares
of the Funds (as defined in "GENERAL INFORMATION-Miscellaneous" in the Funds'
Prospectuses) that are parties to the Distribution Agreement, and (ii) by the
vote of a majority of the Trustees of the Funds who are not parties to the
Distribution Agreement or interested persons (as defined in the 1940 Act) of any
such party, cast in person at a meeting called for the purpose of voting on such
approval. The Agreement may be terminated in the event of its assignment, as
defined in the 1940 Act.
The Distribution Agreement is the successor to the previous
distribution agreement, which terminated automatically by its terms upon
consummation of the acquisition of BISYS by The BISYS Group, Inc. The
Distribution Agreement was unanimously approved by the Board of Trustees of the
Funds and is materially identical to the terminated distribution agreement.
CUSTODIAN, TRANSFER AGENT AND FUND ACCOUNTANT
Cash and securities owned by each of the Funds are held by BOK as
custodian. Under the Custodian Agreement BOK (i) maintains a separate account or
accounts in the name of each Fund; (ii) makes receipts and disbursements of
money on behalf of each Fund; (iii) collects and receives all income and other
payments and distributions on account of the Funds' portfolio securities; (iv)
responds to correspondence from security brokers and others relating to its
duties; and (v) makes periodic reports to the Funds' Board of Trustees
concerning the Funds'
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operations. BOK may, at its own expense, open and maintain a sub-custody account
or accounts on behalf of the Funds, provided that it shall remain liable for the
performance of all of its duties under the Custodian Agreement.
Under the Custodian Agreement, the Funds have agreed to pay BOK a
custodian fee with respect to each Fund at an annual rate of three one
hundredths of one percent (0.03%) of such Fund's average daily net assets. BOK
is also entitled to be reimbursed by the Funds for its reasonable out-of-pocket
expenses incurred in the performance of its duties under the Custodian
Agreement. BOK may periodically set its custodian fees at less than the maximum
allowable amount with respect to a Fund to increase the Fund's net income
available for distribution as dividends.
For custodian services during the fiscal year ended August 31, 1998,
BOK received $112,143 with respect to the U.S. Treasury Fund; $122,264 with
respect to the Cash Management Fund;
$13,930 with respect to the Bond Fund; $24,383 with respect to the Intermediate
Bond Fund; $58,452 with respect to the Equity Fund; $9,074 with respect to the
Intermediate Tax-Free Bond Fund; and $12,909 with respect to the Aggressive
Growth Fund. For custodian services during the fiscal year ended August 31,
1998, BOK received $4,306, which is $2,115 less than the maximum amount of
custody fees, if charged, with respect to the Short-Term Income Fund and $8,262,
which is $3,224 less than the maximum amount of custody fees, if charged, with
respect to the Balanced Fund. For custodian services during the period ended
August 31, 1998, BOK received $17,226 with respect to the Growth Equity Fund.
BISYS Fund Services Ohio, Inc. serves as transfer agent to each of the
Funds pursuant to a Transfer Agency Agreement with the Funds dated September 5,
1990. While BISYS Fund Services Ohio, Inc. is a distinct legal entity from BISYS
Fund Services (each Fund's Administrator and Distributor), BISYS Fund Services
Ohio, Inc. is considered to be an affiliated person of BISYS Fund Services under
the 1940 Act due to, among other things, the fact that BISYS Fund Services Ohio,
Inc. is owned by substantially the same persons that directly or indirectly own
BISYS Fund Services. Under the Transfer Agency Agreement, BISYS Fund Services
Ohio, Inc. has agreed: (i) to issue and redeem Shares of the Funds; (ii) to
address and mail all communications by the Funds to its Shareholders, including
reports to Shareholders, dividend and distribution notices, and proxy material
for its meetings of Shareholders; (iii) to respond to correspondence or
inquiries by Shareholders and others relating to its duties; (iv) to maintain
Shareholder accounts and certain sub-accounts; and (v) to make periodic reports
to the Funds' Board of Trustees concerning the Funds' operations.
Under the Transfer Agency Agreement, the Funds have agreed to pay BISYS
Fund Services Ohio, Inc. with respect to each Fund an annual minimum fee of
$10,000 for less than 100 Shareholder accounts invested in a Fund, $18,000 for
100 to 499 Shareholder accounts invested in a Fund, $24,000 for 500 or more
Shareholder accounts invested in a Fund, $16 for each additional Shareholder
account invested in a Money Market Fund, and $14 for each additional Shareholder
account invested in a non-daily dividend based fund. (The number of Shareholder
accounts for purposes of determining the base fee is calculated on a monthly
B-27
<PAGE> 69
basis.) BISYS Fund Services Ohio, Inc. is also entitled to be reimbursed by the
Funds for postage, handling fees, and reasonable costs of supplies used by BISYS
Fund Services Ohio, Inc. in the performance of its services under the Transfer
Agency Agreement. BISYS Fund Services Ohio, Inc. may periodically set its
transfer agency fees at less than the maximum allowable amount with respect to a
Fund to increase the Fund's net income available for distribution as dividends.
BISYS Fund Services Ohio, Inc. serves as fund accountant for each Fund
pursuant to a fund accounting agreement with the Funds dated September 5, 1990
(the "Fund Accounting Agreement"). As fund accountant for the Funds, BISYS Fund
Services Ohio, Inc. prices the Funds' Shares, calculates the Funds' net asset
value, and maintains the general ledger accounting records for each Fund. Under
its Fund Accounting Agreement with the Funds, BISYS Fund Services Ohio, Inc. is
entitled to receive a fee (1) from each Fund (other than the Intermediate
Tax-Free Bond Fund) at an annual rate of three one-hundredths of one percent
(0.03%) of the Fund's average daily net assets plus out-of-pocket expenses, with
a minimum monthly fee of $2,500 per Fund and (2) from the Intermediate Tax-Free
Bond Fund at an annual rate of four one-hundredths of one percent (0.04%) of the
Fund's average daily net assets, plus out-of-pocket expenses, with a minimum
monthly fee of $3,500. BISYS Fund Services Ohio, Inc. may periodically set its
fund accounting fees at less than the maximum allowable amount with respect to a
Fund in order to increase the Fund's net income available for distribution as
dividends.
For transfer agency and Fund accounting services during the fiscal year
ended August 31, 1998, BISYS Fund Services Ohio, Inc. received $164,113 with
respect to the U.S. Treasury Fund; $179,164 with respect to the Cash Management
Fund; $39,980 with respect to the Bond Fund; $70,267 with respect to the
Intermediate Bond Fund; $105,495 with respect to the Equity Fund; $31,831 with
respect to the Intermediate Tax-Free Bond Fund; $37,825 with respect to
Aggressive Growth Fund; $31,564 with respect to the Short-Term Income Fund; and
$33,070 with respect to the Balanced Fund. For transfer agency and Fund
accounting services during the period ended August 31, 1998, BISYS Fund Services
Ohio, Inc. received $32,198 with respect to the Growth Equity Fund.
AUDITORS
KPMG Peat Marwick LLP, Two Nationwide Plaza, Columbus, Ohio, 43215,
serves as independent public accountants for the Funds.
LEGAL COUNSEL
Ropes & Gray, Suite 800 East, One Franklin Square, 1301 K Street, N.W.,
Washington, D.C. 20005 are counsel to the Funds.
B-28
<PAGE> 70
ADDITIONAL INFORMATION
DESCRIPTION OF SHARES
The Funds are separate series of a single Massachusetts business trust
which was organized on October 1, 1987 and began active operations in August of
1990. The Declaration of Trust was filed with the Secretary of State of the
Commonwealth of Massachusetts on October 2, 1987 and authorizes the Board of
Trustees to issue an unlimited number of Shares, which are units of beneficial
interest, with par value of $0.00001. The Funds currently comprise eleven series
of Shares which represent interests in the U.S. Treasury Fund, the Cash
Management Fund, the Bond Fund, the Intermediate Bond Fund, the Intermediate
Tax-Free Bond Fund, the Equity Fund, the Aggressive Growth Fund, the Short-Term
Income Fund, the Balanced Fund , the Growth Equity Fund, and the Small Cap
Equity Fund. The Declaration of Trust authorizes the Board of Trustees to divide
or redivide any unissued Shares of the Funds into one or more additional series
by setting or changing in any one or more respects their respective preferences,
conversion or other rights, voting power, restrictions, limitations as to
dividends, qualifications, and terms and conditions of redemption.
Shares have no subscription or preemptive rights and only such
conversion or exchange rights as the Board may grant in its discretion. When
issued for payment as described in the Prospectuses and this Statement of
Additional Information, the Funds' Shares will be fully paid and non-assessable.
In the event of a liquidation or dissolution of the Funds, Shares of a Fund are
entitled to receive the assets available for distribution belonging to the Fund,
and a proportionate distribution, based upon the relative asset values of the
respective Funds, of any general assets not belonging to any particular Fund
which are available for distribution.
Rule 18f-2 under the 1940 Act provides that any matter required to be
submitted to the holders of the outstanding voting securities of an investment
company such as the Funds shall not be deemed to have been effectively acted
upon unless approved by the holders of a majority of the outstanding Shares of
each Fund affected by the matter. For purposes of determining whether the
approval of a majority of the outstanding Shares of a Fund will be required in
connection with a matter, a Fund will be deemed to be affected by a matter
unless it is clear that the interests of each Fund in the matter are identical
(in which case the Shareholders of the Funds will vote in the aggregate), or
that the matter does not affect any interest of the Fund (in which case no vote
by the Shareholders of the Fund in question will be required). Under Rule 18f-2,
the approval of an investment advisory agreement or any change in investment
policy would be effectively acted upon with respect to a Fund only if approved
by a majority of the outstanding Shares of such Fund. However, Rule 18f-2 also
provides that the ratification of independent public accountants, the approval
of principal underwriting contracts, and the election of Trustees may be
effectively acted upon by Shareholders of the Funds voting without regard to
series.
B-29
<PAGE> 71
SHAREHOLDER AND TRUSTEE LIABILITY
Under Massachusetts law, holders of units of beneficial interest in a
business trust may, under certain circumstances, be held personally liable as
partners for the obligations of the trust. However, the Declaration of Trust
provides that Shareholders shall not be subject to any personal liability for
the obligations of the Funds, and that every written agreement, obligation,
instrument, or undertaking made by the Funds shall contain a provision to the
effect that the Shareholders are not personally liable thereunder. The
Declaration of Trust provides for indemnification out of the trust property of
any Shareholder held personally liable solely by reason of his being or having
been a Shareholder. The Declaration of Trust also provides that the Funds shall,
upon request, assume the defense of any claim made against any Shareholder for
any act or obligation of the Funds, and shall satisfy any judgment thereon.
Thus, the risk of a Shareholder incurring financial loss on account of
Shareholder liability is limited to circumstances in which the Funds themselves
would be unable to meet their obligations.
The Declaration of Trust states further that no Trustee, officer, or
agent of the Funds shall be personally liable in connection with the
administration or preservation of the assets of the trust or the conduct of the
Funds' business; nor shall any Trustee, officer, or agent be personally liable
to any person for any action or failure to act except for his own bad faith,
willful misfeasance, gross negligence, or reckless disregard of his duties. The
Declaration of Trust also provides that all persons having any claim against the
Trustees or the Funds shall look solely to the assets of the trust for payment.
CALCULATION OF PERFORMANCE DATA
Based on the seven-day period ended August 31, 1998 (the "base
period"), the yield of the Cash Management Fund was 4.98% and the Fund's
effective yield was 5.10%. Based on the same base period, the yield of the U.S.
Treasury Fund was 4.87% and the Fund's effective yield was 4.99%. Each Money
Market Fund's seven-day yield is computed by determining the percentage net
change, excluding capital changes, in the value of an investment in one share of
the Fund over the base period, and multiplying the net change by 365/7 (or
approximately 52 weeks). Each Money Market Fund's effective yield represents a
compounding of the yield by adding 1 to the number representing the percentage
change in value of the investment during the base period, raising that sum to a
power equal to 365/7, and subtracting 1 from the result.
Based on the thirty-day period ended August 31, 1998 ("30-day base
period"), the 30-day yields of the Bond Investment Funds were as follows: the
Bond Fund, 5.75% (without load) and 5.52% (with load); the Intermediate Bond
Fund, 5.45% (without load) and 5.29% (with load); and the Intermediate Tax-Free
Bond Fund, 3.25% (without load) and 3.16% (with load); the Short-Term Income
Fund, 5.99% (without load) and 5.87% (with load). The 30-day yield of each Bond
Investment Fund is calculated by dividing the net investment income per-share
earned during the 30-day base period by the maximum offering price per share on
the last day of the period, according to the following formula:
B-30
<PAGE> 72
30-Day Yield = 2[( a-b +1)6-1]
cd
In the above formula, "a" represents dividends and interest earned
during the 30-day base period; "b" represents expenses accrued for the 30-day
base period (net of reimbursements); "c" represents the average daily number of
shares outstanding during the 30-day base period that were entitled to receive
dividends; and "d" represents the maximum offering price per share on the last
day of the 30-day base period.
The tax equivalent yield for the Intermediate Tax-Free Bond Fund is
computed by dividing that portion of the Intermediate Tax Free Bond Fund's yield
which is tax-exempt by one minus a stated income tax rate and adding the product
to that portion, if any, of the yield of the Fund that is not tax-exempt. The
tax-equivalent yield for the Intermediate Tax-Free Bond Fund will generally be
computed based on an assumed effective Federal income tax rate of 39.6%.
The average annual total return of each Bond Investment Fund, Equity
Investment Fund, and the Small Cap Equity Fund is determined by calculating the
change in the value of a hypothetical $1,000 investment in the Fund for each of
the periods shown. Average annual total return for each Fund was computed by
determining the average annual compounded rate of return over the applicable
period that would equate the initial amount invested to the ending redeemable
value of the investment. The ending redeemable value includes dividends and
capital gain distributions reinvested at net asset value. The resulting
percentages indicated the positive or negative investment results that an
investor would have experienced from changes in Share price and reinvestment of
dividends and capital gains distributions. The total return data above are
calculated assuming the imposition of the maximum sales charge for each
respective Fund.
The average annual total returns for the one-year period ended August
31, 1998 for the Bond Investment Funds, assuming the imposition of a sales load,
were as follows: the Bond Fund, 7.04%; the Intermediate Bond Fund, 5.50%; the
Intermediate Tax-Free Bond Fund, 4.09%; and the Short-Term Income Fund, 6.33%.
The average annual total returns for the one-year period ended August 31, 1998
for the Equity Investment Funds, assuming the imposition of a sales load, were
as follows: the Equity Fund, -4.24%; the Balanced Fund, -0.64%; and the Growth
Equity Fund, 8.99%.(1)
- ------------
(1) The performance data for the Growth Equity Fund includes the
performance history of its predecessor fund, a common trust fund, for the period
before the Growth Equity Fund commenced operations on November 1, 1997. The
predecessor fund was not registered under the 1940 Act and therefore was not
subject to certain investment restrictions, limitations and diversification
requirements imposed by the 1940 Act and the Code. If the predecessor fund had
been subject to such requirements under the 1940 Act and the Code its
performance may have been adversely affected.
B-31
<PAGE> 73
The average annual total returns, for Shareholders who are not subject
to a sales charge, for the one-year period ended August 31, 1998 were as
follows: the Equity Fund 0.79%, the Aggressive Growth -30.85%, the Bond Fund
11.54%, the Intermediate Bond Fund 8.80%, the Intermediate Tax-Free Bond Fund
7.28%, the Short-Term Income Fund 8.47%, the Balanced Fund 4.55%, and the Growth
Equity Fund 14.76%.1
The average annual total returns for the five-year period ended August
31, 1998 were: 6.02% (without sales charge) and 5.16% (as adjusted for maximum
sales charge) for the Bond Fund; 5.19% (without sales charge) and 4.55% (as
adjusted for maximum sales charge) for the Intermediate Bond Fund; 15.99%
(without sales charge) and 14.81% (as adjusted for maximum sales charge) for the
Equity Fund; and 5.40% (without sales charge) and 4.77% (as adjusted for maximum
sales charge) for the Intermediate Tax-Free Bond Fund.
The average annual total returns for the following Funds are:
Short-Term Income Fund from commencement of operations (October 19, 1994) to
August 31, 1998 was 6.66% (without sales charge) and 6.11% (as adjusted for
maximum sales charge); and Balanced Fund from commencement of operations (June
1, 1995) to August 31, 1998 was 14.81% (without sales charge) and 13.00% (as
adjusted for maximum sales charge).
The average annual total returns for the following Funds are: Bond Fund
from commencement of operations (September 28, 1990) to August 31, 1998, 8.50%
(without sales charge) and 7.94% (as adjusted for maximum sales charge);
Intermediate Bond Fund from commencement of operations (September 28, 1990) to
August 31, 1998, 7.39% (without sales charge) and 6.97% (as adjusted for maximum
sales charge); Intermediate Tax-Free Bond Fund from commencement of operations
(May 29, 1992) to August 31, 1998, 6.66% (without sales charge) and 6.14% (as
adjusted for maximum sales charge), Equity Fund from commencement of operations
(September 28, 1990) to August 31, 1998, 14.34% (without sales charge) and
13.59% (as adjusted for maximum sales charge); and Growth Equity Fund from
commencement of operations (June 10, 1994) to August 31, 1998, 24.14% (without
sales charge) and 22.63% (as adjusted for maximum sales charge).1
Performance will fluctuate from time to time and is not necessarily
representative of future results. Accordingly, a Fund's performance may not
provide for comparison with bank deposits or other investments that pay a fixed
return for a stated period of time. Performance is a function of a Fund's
quality, composition, and maturity, as well as expenses allocated to the Fund.
Fees imposed upon Customer accounts by Participating Organizations will reduce a
Fund's effective yield to customers.
PERFORMANCE COMPARISONS
Investors may judge the performance of the Funds by comparing their
performance to the performance of other mutual funds or mutual fund portfolios
with comparable investment objectives and policies through various mutual fund
or market indices such as the Morgan Stanley Capital International EAFE Index
and those prepared by Dow Jones & Co., Inc.,
B-32
<PAGE> 74
Standard & Poor's Corporation, Shearson Lehman Brothers, Inc. and The Russell
2000 Index and to data prepared by Lipper Analytical Services, Inc., a widely
recognized independent service which monitors the performance of mutual funds,
Morningstar, Inc. and the Consumer Price Index. Comparisons may also be made to
indices or data published in Donoghue's MONEY FUND REPORT of Holliston,
Massachusetts 01746, a nationally recognized money market fund reporting
service, Money Magazine, Forbes, Fortune, Ibbotson Associates, Inc.,
CDA/Wiesenberger, American Banker, Institutional Investor, Barron's, The Wall
Street Journal, The Bond Buyer's Weekly 20-Bond Index, The Bond Buyer's Index,
The Bond Buyer, The New York Times, Business Week, Pensions and Investments,
U.S.A. Today and local newspapers. In addition to performance information,
general information about these Funds that appears in a publication such as
those mentioned above may be included in advertisements and in reports to
Shareholders.
From time to time, the Funds may include the following types of
information in advertisements, supplemental sales literature and reports to
Shareholders: (1) discussions of general economic or financial principles (such
as the effects of inflation, the power of compounding and the benefits of
dollar-cost averaging); (2) discussions of general economic trends; (3)
presentations of statistical data to supplement such discussions; (4)
descriptions of past or anticipated portfolio holdings for one or more of the
Funds within the Trust; (5) descriptions of investment strategies for one or
more of such Funds; (6) descriptions or comparisons of various savings and
investment products (including but not limited to insured bank products,
annuities, qualified retirement plans and individual stocks and bonds) which may
or may not include the Funds; (7) comparisons of investment products (including
the Funds) with relevant market or industry indices or other appropriate
benchmarks; (8) discussions of fund rankings or ratings by recognized rating
organizations; and (9) testimonials describing the experience of persons that
have invested in one or more of the Funds. In addition, with respect to the
Intermediate Tax-Free Bond Fund, the benefits of tax-free investments may be
communicated to shareholders. For example, the Intermediate Tax-Free Bond Fund
may present information on the yield that a taxable investment must earn at
various income brackets to produce after-tax yields equivalent to those of the
tax-exempt investments.
The Funds may also include calculations, such as hypothetical
compounding examples, which describe hypothetical investment results in such
communications. Such performance examples will be based on an express set of
assumptions and are not indicative of the performance of any of the Funds.
Morningstar, Inc., Chicago, Illinois, rates mutual funds on a one- to
five-star rating scale with five stars representing the highest rating. Such
ratings are based upon a fund's historical risk/reward ratio as determined by
Morningstar relative to other funds in that fund's class. Funds are divided into
classes based upon their respective investment objectives. The one- to five-star
ratings represent the following ratings by Morningstar, respectively: Lowest,
Below Average, Neutral, Above Average and Highest.
Current yields or performance will fluctuate from time to time and are
not necessarily representative of future results. Accordingly, a Fund's yield or
performance may not provide
B-33
<PAGE> 75
for comparison with bank deposits or other investments that pay a fixed return
for a stated period of time. Yield and performance are functions of a Fund's
quality, composition, and maturity, as well as expenses allocated to the Fund.
Fees imposed on its affiliated or correspondent banks for cash
management services will reduce a Fund's effective yield to Customers.
MISCELLANEOUS
The Funds are not required to hold a meeting of Shareholders for the
purpose of electing Trustees except that (i) the Funds are required to hold a
Shareholders' meeting for the election of Trustees at such time as less than a
majority of the Trustees holding office have been elected by Shareholders and
(ii) if, as a result of a vacancy on the Board of Trustees, less than two-thirds
of the Trustees holding office have been elected by the Shareholders, that
vacancy may only be filled by a vote of the Shareholders. In addition, Trustees
may be removed from office by a written consent signed by the holders of Shares
representing two-thirds of the outstanding Shares of the Funds at a meeting duly
called for the purpose, which meeting shall be held upon the written request of
the holders of Shares representing not less than 10% of the outstanding Shares
of the Funds. Upon written request by the holders of Shares representing 1% of
the outstanding Shares of the Funds stating that such Shareholders wish to
communicate with the other Shareholders for the purpose of obtaining the
signatures necessary to demand a meeting to consider removal of a Trustee, the
Funds will provide a list of Shareholders or disseminate appropriate materials
(at the expense of the requesting Shareholders). Except as set forth above, the
Trustees may continue to hold office and may appoint successor Trustees.
The Funds are registered with the SEC as a management investment
company. Such registration does not involve supervision by the Commission of the
management or policies of the Funds.
The Prospectuses and this Statement of Additional Information omit
certain of the information contained in the Registration Statement filed with
the SEC. Copies of such information may be obtained from the Commission upon
payment of the prescribed fee.
The Prospectuses and this Statement of Additional Information are not
an offering of the securities herein described in any state in which such
offering may not lawfully be made. No salesman, dealer, or other person is
authorized to give any information or make any representation other than those
contained in the Prospectus and Statement of Additional Information.
As of November __, 1998 Bank of Oklahoma, N.A. and its bank affiliates
possessed, on behalf of its underlying accounts, voting and investment power
with respect to [____%] of the U.S. Treasury Fund's Shares, [ %] of the Cash
Management Fund's Shares, [ %] of the Equity Fund's Shares, [ %] of the
Aggressive Growth Fund's Shares, [ %] of the Balanced Fund's Shares, [ %] of the
Bond Fund's Shares, [ %] of the Intermediate Bond
B-34
<PAGE> 76
Fund's Shares, [ %] of the Short-Term Income Fund's Shares, [ %] of the
Intermediate Tax-Free Bond Fund's Shares and [ %] of the Growth Equity Fund's
Shares, and, as a consequence, Bank of Oklahoma, N.A. and its bank affiliates
may be deemed to be a controlling person of each Fund under the 1940 Act.
As of November 27, 1998, the trustees and officers of the Funds, as a
group, owned less than one percent of the Shares of each of the Funds.
The following table indicates each additional person known by the Funds
to own of record five percent (5%) or more of the Shares of the Funds as of
November 27, 1998:
<TABLE>
<CAPTION>
AMOUNT OF OWNERSHIP PERCENT
NAME AND ADDRESS OF RECORD OF FUND
- ---------------- -------------------- -------
<S> <C> <C>
CASH MANAGEMENT FUND
NABANK and Co. 96.80%
CASH
P.O. Box 2300
Tulsa, OK 74192
U.S. TREASURY FUND
NABANK and Co. 97.14%
CASH
P.O. Box 2300
Tulsa, OK 74192
INTERMEDIATE TAX-FREE BOND FUND
NABANK and Co. 5.48%
Trust Accounting
P.O. Box 2300
Tulsa, OK 74192
NABANK and Co. 80.79%
Income CAS/CG
Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
</TABLE>
B-35
<PAGE> 77
<TABLE>
<CAPTION>
AMOUNT OF OWNERSHIP PERCENT
NAME AND ADDRESS OF RECORD OF FUND
- ---------------- -------------------- -------
<S> <C> <C>
EQUITY FUND
NABANK and Co. 47.58%
All Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
NABANK and Co. 50.67%
Income Cash/CGReinvest Account
P.O. Box 2300
Tulsa, OK 74192
BOND FUND
NABANK and Co. 51.62%
All Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
NABANK and Co. 47.39%
Income Cash/CG
Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
INTERMEDIATE BOND FUND
NABANK and Co. 34.61%
All Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
NABANK and Co. 62.70%
Income
Cash/CG/Reinvest
P.O. Box 2300
Tulsa, OK 74192
</TABLE>
B-36
<PAGE> 78
<TABLE>
<CAPTION>
AMOUNT OF OWNERSHIP PERCENT
NAME AND ADDRESS OF RECORD OF FUND
- ---------------- -------------------- -------
<S> <C> <C>
AGGRESSIVE GROWTH FUND
NABANK and Co. 58.14%
All Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
NABANK and Co. 34.37%
Income
Cash/CG/Reinvest
P.O. Box 2300
Tulsa, OK 74192
HC Limited Partnership 5.79%
1300 Belmont No. 209
Chicago, IL 60657
SHORT TERM INCOME FUND
NABANK and Co. 29.45%
All Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
NABANK and Co. 68.84%
Income
Cash/CG/Reinvest
P.O. Box 2300
Tulsa, OK 74192
BALANCED FUND
NABANK and Co. 99.47%
All Reinvest Account
P.O. Box 2300
Tulsa, OK 74192
</TABLE>
B-37
<PAGE> 79
<TABLE>
<CAPTION>
AMOUNT OF OWNERSHIP PERCENT
NAME AND ADDRESS OF RECORD OF FUND
- ---------------- -------------------- -------
<S> <C> <C>
GROWTH EQUITY FUND
NABANK and Co. 73.35%
Income
Cash/CG/Reinvest
P.O. Box 2300
Tulsa, OK 74192
NABANK and Co. 23.94%
All Reinvest
P.O. Box 2300
Tulsa, OK 74192
</TABLE>
B-38
<PAGE> 80
FINANCIAL STATEMENTS
The Independent Auditors' Report for the American Performance Funds for
the year ended August 31, 1998 and Financial Statements for the American
Performance Funds for the five year period ended August 31, 1998, appearing in
the Annual Report, are incorporated by reference in the Statement of Additional
Information. A copy of the Annual Report dated as of August 31, 1998 and the
Semi-Annual Report dated as of February 28, 1998 may be obtained without charge
by contacting the Distributor, BISYS Fund Services at 3435 Stelzer Road,
Columbus, Ohio 43219 or by telephoning toll-free at 1-800-762-7085.
B-39
<PAGE> 81
APPENDIX
The nationally recognized statistical rating organizations
(individually, an "NRSRO") that may be utilized by the Funds with regard to
portfolio investments for the Funds include Moody's Investors Service, Inc.
("Moody's"), Standard & Poor's Corporation ("S&P"), Duff & Phelps, Inc.
("Duff"), Fitch IBCA, and Thomson BankWatch, Inc. ("Thomson"). Set forth below
is a description of the relevant ratings of each such NRSRO. The NRSROs that may
be utilized by the Funds and the description of each NRSRO's ratings is as of
the date of this Statement of Additional Information, and may subsequently
change.
Long-Term Debt Ratings (may be assigned, for example, to corporate and municipal
bonds)
Description of the five highest long-term debt ratings by Moody's (Moody's
applies numerical modifiers (1, 2, and 3) in each rating category to indicate
the security's ranking within the category):
Aaa Bonds which are rated Aaa are judged to be of the best
quality. They carry the smallest degree of investment risk and
are generally referred to as "gilt edged." Interest payments
are protected by a large or by an exceptionally stable margin
and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are
most unlikely to impair the fundamentally strong position of
such issues.
Aa Bonds which are rated Aa are judged to be of high quality by
all standards. Together with the Aaa group they comprise what
are generally known as high-grade bonds. They are rated lower
than the best bonds because margins of protection may not be
as large as in Aaa securities or fluctuation of protective
elements may be of greater amplitude or there may be other
elements present which make the long-term risk appear somewhat
larger than in Aaa securities.
A Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper-medium-grade
obligations. Factors giving security to principal and interest
are considered adequate, but elements may be present which
suggest a susceptibility to impairment some time in the
future.
Baa Bonds which are rated Baa are considered as medium-grade
obligations, (i.e., they are neither highly protected nor
poorly secured). Interest payments and principal security
appear adequate for the present but certain protective
elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack
outstanding investment characteristics and in fact have
speculative characteristics as well.
Ba Bonds which are rated Ba are judged to have speculative
elements; their future cannot be considered as well-assured.
Often the protection of interest and principal payments may be
very moderate, and thereby not well safeguarded
B-40
<PAGE> 82
during both good and bad times in the future. Uncertainty of
position characterizes bonds in this class.
Description of the five highest long-term debt ratings by S&P (S&P may apply a
plus (+) or minus (-) to a particular rating classification to show relative
standing within that classification):
AAA An obligation rated AAA has the highest rating assigned by
S&P. The obligor's capacity to meet its financial commitment
on the obligation is extremely strong.
AA An obligation rated AA differs from the highest-rated
obligations only in small degree. The obligor's capacity to
meet its financial commitment on the obligation is very
strong.
A An obligation rated A is somewhat more susceptible to the
adverse effects of changes in circumstances and economic
conditions than obligations in higher-rated categories.
However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.
BBB An obligation rated BBB exhibits adequate protection
parameters. However, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity
of the obligor to meet its financial commitment on the
obligation.
Obligations rated BB, B, CCC, CC, and C are regarded as having
significant speculative characteristics. BB indicates the
least degree of speculation and C the highest. While such
obligations will likely have some quality and protective
characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.
BB An obligation rated BB is less vulnerable to nonpayment than
other speculative issues. However, it faces major ongoing
uncertainties or exposure to adverse business, financial, or
economic conditions which could lead to the obligor's
inadequate capacity to meet its financial commitment on the
obligation.
Description of the three highest long-term debt ratings by Duff:
AAA Highest credit quality. The risk factors are negligible, being
only slightly more than for risk-free U.S. Treasury debt.
AA+ High credit quality. Protection factors are strong.
AA Risk is modest but may vary slightly from time to
AA- time because of economic conditions.
A+ Protection factors are average but adequate. However,
B-41
<PAGE> 83
A risk factors are more variable and greater in periods
A- of economic stress.
Description of the three highest long-term debt ratings by Fitch IBCA (plus or
minus signs are used with a rating symbol to indicate the relative position of
the credit within the rating category):
AAA Obligations which have the highest rating assigned by Fitch
IBCA. Capacity for timely repayment principal and interest is
extremely strong relative to other obligors in the same
country.
AA Obligations for which capacity for timely repayment of
principal and interest is very strong relative to other
obligors in the same country. The risk attached to these
obligations differs only slightly from the country's highest
rated debt.
A Obligations for which capacity for timely repayment of
principal and interest is strong relative to other obligors in
the same country. However, adverse changes in business,
economic or financial conditions are more likely to affect the
capacity for timely repayment than for obligations in higher
rated categories.
Short-Term Debt Ratings (may be assigned, for example, to commercial paper,
master demand notes, bank instruments, and letters of credit)
Moody's description of its three highest short-term debt ratings:
Prime-1 Issuers rated Prime-1 (or supporting institutions) have
a superior ability for repayment of senior short-term
debt obligations. Prime-1 repayment ability will often
be evidenced by many of the following characteristics:
-Leading market positions in well-established
industries.
-High rates of return on funds employed.
-Conservative capitalization structures with
moderate reliance on debt and ample asset
protection.
-Broad margins in earnings coverage of fixed
financial charges and high internal cash
generation.
-Well-established access to a range of financial
markets and assured sources of alternate liquidity.
Prime-2 Issuers rated Prime-2 (or supporting institutions) have
a strong ability for repayment of senior short-term
debt obligations. This will normally be evidenced by
many of the characteristics cited above but to a lesser
B-42
<PAGE> 84
degree. Earnings trends and coverage ratios, while
sound, may be more subject to variation.
Capitalization characteristics, while still
appropriate, may be more affected by external
conditions. Ample alternate liquidity
is maintained.
Prime-3 Issuers rated Prime-3 (or supporting institutions) have
an acceptable ability for repayment of senior
short-term obligations. The effect of industry
characteristics and market compositions may be more
pronounced. Variability in earnings and profitability
may result in changes in the level of debt protection
measurements and may require relatively high financial
leverage. Adequate alternate liquidity is maintained.
S&P's description of its three highest short-term debt ratings:
A-1 A short-term obligation rated A-1 is rated in the highest
category by S&P. The obligor's capacity to meet its financial
commitment on the obligation is strong. Within this category,
certain obligations are designated with a plus sign (+). This
indicates that the obligor's capacity to meet its financial
commitment on these obligations is extremely strong.
A-2 A short-term obligation rated A-2 is somewhat more susceptible
to the adverse effects of changes in circumstances and
economic conditions than obligations in higher rating
categories. However, the obligor's capacity to meet its
financial commitment on the obligation is satisfactory.
A-3 A short-term obligation rated A-3 exhibits adequate protection
parameters. However, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity
of the obligor to meet its financial commitment on the
obligation.
Duff's description of its three highest short-term debt ratings (Duff
incorporates gradations of "1+" (one plus) and "1-" (one minus) to assist
investors in recognizing quality differences within the highest rating
category):
D-1+ Highest certainty of timely payment. Short-term liquidity,
including internal operating factors and/or access to
alternative sources of funds, is outstanding, and safety is
just below risk-free U.S. Treasury short-term obligations.
D-1 Very high certainty of timely payment. Liquidity factors are
excellent and supported by good fundamental protection
factors. Risk factors are minor.
D-1- High certainty of timely payment. Liquidity factors are strong
and supported by good fundamental protection factors. Risk
factors are very small.
B-43
<PAGE> 85
D-2 Good certainty of timely payment. Liquidity factors and
company fundamentals are sound. Although ongoing funding needs
may enlarge total financing requirements, access to capital
markets is good. Risk factors are small.
D-3 Satisfactory liquidity and other protection factors qualify
issues as to investment grade. Risk factors are larger and
subject to more variation. Nevertheless, timely payment is
expected.
Fitch IBCA's description of its three highest short-term debt ratings:
Fl Obligations assigned this rating have the highest capacity for
timely repayment under Fitch IBCA's national rating scale for
that country, relative to other obligations in the same
country. Where issues possess a particularly strong credit
feature, a "+" is added to the assigned rating.
F2 Obligations supported by a strong capacity for timely
repayment relative to other obligors in the same country.
However, the relative degree of risk is slightly higher than
for issues classified as 'Al' and capacity for timely
repayment may be susceptible to adverse changes in business,
economic, or financial conditions.
F3 Obligations supported by an adequate capacity for timely
repayment relative to other obligors in the same country. Such
capacity is more susceptible to adverse changes in business,
economic, or financial conditions than for obligations in
higher categories.
Short-Term Loan/Municipal Note Ratings
Moody's description of its two highest short-term loan/municipal note ratings:
MIG-1/VMIG-1 This designation denotes best quality. There is present
strong protection by established cash flows, superior
liquidity support or demonstrated broad-based access to
the market for refinancing.
MIG-2/VMIG-2 This designation denotes high quality. Margins of
protection are ample although not so large as in the
preceding group.
Short-Term Debt Ratings
Thomson BankWatch, Inc. ("TBW") ratings are based upon a qualitative and
quantitative analysis of all segments of the organization including, where
applicable, holding company and operating subsidiaries.
B-44
<PAGE> 86
BankWatch(TM) Ratings do not constitute a recommendation to buy or sell
securities of any of these companies. Further, BankWatch does not suggest
specific investment criteria for individual clients.
The TBW Short-Term Ratings apply to commercial paper, other senior short-term
obligations and deposit obligations of the entities to which the rating has been
assigned.
The TBW Short-Term Ratings apply only to unsecured instruments that have a
maturity of one year or less.
The TBW Short-Term Ratings specifically assess the likelihood of an untimely
payment of principal or interest.
TBW-1 The highest category; indicates a very high likelihood
that principal and interest will be paid on a timely
basis.
TBW-2 The second highest category; while the degree of safety
regarding timely repayment of principal and interest is
strong, the relative degree of safety is not as high as
for issues rated "TBW-1".
TBW-3 The lowest investment-grade category; indicates that
while the obligation is more susceptible to adverse
developments (both internal and external) than those
with higher ratings, capacity to service principal and
interest in a timely fashion is considered adequate.
TBW-4 The lowest rating category; this rating is regarded as
non-investment grade and therefore speculative.
B-45
<PAGE> 87
REGISTRATION STATEMENT
OF
AMERICAN PERFORMANCE FUNDS
ON
FORM N-1A
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
---------------------------------
(a) Financial Statements:
Included in Part A:
-- Financial Highlights.
Included in Part B:
The following financial statements have been incorporated into the
Statement of Additional Information by reference to American
Performance Funds' Annual
Report to Shareholders, dated August 31, 1998:
-- Independent Auditors' Report dated October 9, 1998.
-- Statements of Assets and Liabilities as of August 31, 1998 (audited).
-- Statements of Operations for the fiscal year ended August 31, 1998
(audited).
-- Statements of Changes in Net Assets for the years ended August 31,
1998 and 1997 (audited).
-- Schedules of Portfolio Investments at August 31, 1998 (audited).
-- Notes to Financial Statements dated August 31, 1998 (audited).
-- Financial Highlights for each of the periods or years ended
August 31, 1994, August 31, 1995, August 31, 1996, August 31,
1997, and August 31, 1998 (audited).
<PAGE> 88
(b) Exhibits:
(1) Agreement and Declaration of Trust dated October 1, 1987,
as amended and restated on August 20, 1990 is incorporated
by reference to Exhibit 1 to Post-Effective Amendment No.
1 to the Funds' Registration
Statement (filed October 31, 1990).
(2)(a) Bylaws as approved and adopted by Registrant's Board of
Trustees is incorporated by reference to Exhibit 2 to
Post-Effective Amendment No. 1 to the Funds' Registration
Statement (filed October 31, 1990).
(2)(b) Certified Resolution of the Registrant's Board of Trustees
amending the Registrant's Bylaws as adopted by a unanimous
vote at a meeting of the Board of Trustees on October 25,
1991 is incorporated by reference to Exhibit 2(b) to
Post-Effective Amendment No. 3 to the Funds' Registration
Statement (filed November 26, 1991).
(3) None.
(4)(a) Article III, Section 4 and 5, Article V, Article VIII,
Section 4, and Article IX, Sections 1, 4, 5 and 7 of the
Agreement and Declaration of Trust dated October 1, 1987,
as amended and restated on August 20, 1990 is incorporated
by reference to Exhibit 1 to Post-Effective Amendment No.
1 to the Funds' Registration Statement (filed October 31,
1990).
(4)(b) Article 9, Article 10, Section 6 and Article 11 of the
Bylaws as approved and adopted by Registrant's Board of
Trustees is incorporated by reference to Exhibit 2 to
Post-Effective Amendment No. 1 to the Funds' Registration
Statement (filed October 31, 1990).
(4)(c) Certified Resolution of the Registrant's Board of Trustees
amending the Registrant's Bylaws as adopted by a unanimous
vote at a meeting of the Board of Trustees on October 25,
1991 is incorporated by reference to Exhibit 2(b) to
Post-Effective Amendment No. 3 to the Funds' Registration
Statement (filed November 26, 1991).
(5)(a) Investment Advisory Agreement between Registrant and Bank
of Oklahoma, N.A. (formerly BancOklahoma Trust Company)
dated October 1, 1994 is incorporated by reference to
Exhibit (5)(a) to Post-Effective Amendment No. 11 to the
Funds' Registration Statement (filed February 13, 1995).
C-2
<PAGE> 89
(5)(b) Sub-Investment Advisory Agreement between Bank of
Oklahoma, N.A. and AMR Investment Services, Inc. dated
June 16, 1997 is incorporated by reference to Exhibit 5(b)
to Post-Effective Amendment No. 16 to the Funds'
Registration Statement (filed December 17, 1997).
(5)(c) Amended Schedule A to the Investment Advisory Agreement
between Registrant and Bank of Oklahoma, N.A. (formerly
BancOklahoma Trust Company) dated October 1, 1994 is
incorporated by reference to Exhibit 5(d) to
Post-Effective Amendment No. 16 to the Funds' Registration
Statement (filed December 17, 1997).
(5)(d) Form of Amended Schedule A to the Investment Advisory
Agreement between Registrant and Bank of Oklahoma, N.A.
(formerly BancOklahoma Trust Company) dated October 1,
1994 is filed herewith.
(6)(a) Distribution Agreement between Registrant and BISYS Fund
Services, LP (formerly, The Winsbury Company Limited
Partnership) is incorporated by reference to Exhibit 6(a)
to Post-Effective Amendment No. 6 to the Funds'
Registration Statement (filed December 7, 1993).
(6)(b) Amended Schedules A and B to Distribution Agreement
between Registrant and BISYS Fund Services, LP (formerly,
The Winsbury Company Limited Partnership) dated October 1,
1993 are incorporated by reference to Exhibit 6(c) to
Post-Effective Amendment No. 16 to the Funds' Registration
Statement (filed December 17, 1997).
(6)(c) Form of Amended Schedules A and B to Distribution
Agreement between Registrant and BISYS Fund Services, LP
(formerly, The Winsbury Company Limited Partnership) dated
October 1, 1993 are filed herewith.
(7) None.
(8)(a) Custodian Agreement between Registrant and Bank of
Oklahoma, N.A. is incorporated by reference to Exhibit
8(a) to Post-Effective Amendment No. 1 to the Funds'
Registration Statement (filed October 31, 1990).
C-3
<PAGE> 90
(8)(b) Amended Schedule A to Custodian Agreement between
Registrant and Bank of Oklahoma, N.A. is incorporated by
reference to Exhibit 8(c) to Post-Effective Amendment No.
16 to the Funds' Registration Statement (filed December
17, 1997).
(8)(c) Form of Amended Schedule A to Custodian Agreement between
Registrant and Bank of Oklahoma, N.A. is filed herewith.
(9)(a) Management and Administration Agreement between Registrant
and BISYS Fund Services, LP (formerly The Winsbury Company
Limited Partnership) dated September 5, 1990, as amended
and restated on May 12, 1995, is incorporated by reference
to Exhibit 9(a) to Post-Effective Amendment No. 13 to the
Funds' Registration Statement (filed October 31, 1995).
(9)(b) Amended Schedule A to the Management and Administration
Agreement between Registrant and BISYS Fund Services, LP
(formerly The Winsbury Company Limited Partnership) dated
September 5, 1990, as amended and restated on May 12, 1995
is incorporated by reference to Exhibit 9(b) to
Post-Effective Amendment No. 16 to the Funds' Registration
Statement (filed December 17, 1997).
(9)(c) Transfer Agency and Shareholder Service Agreement between
Registrant and BISYS Fund Services Ohio, Inc. (formerly,
The Winsbury Service Corporation) is incorporated by
reference to Exhibit 9(b) to Post-Effective Amendment No.
1 to the Funds' Registration Statement (filed October 31,
1990).
(9)(d) Fund Accounting Agreement between Registrant and BISYS
Fund Services Ohio, Inc. (formerly, The Winsbury Service
Corporation) dated September 5, 1990, as amended and
restated May 12, 1995, is incorporated by reference to
Exhibit 9(d) to Post-Effective Amendment No. 15 to the
Funds' Registration Statement (filed June 24, 1997).
(9)(e) Sub-Administration Agreement between BISYS Fund Services,
Limited Partnership and Bank of Oklahoma, N.A. dated July
25, 1997 is incorporated by reference to Exhibit 9(f) to
Post-Effective Amendment No. 16 to the Funds' Registration
Statement (filed December 17, 1997).
(9)(f) Amended Schedule A to Transfer Agency and Shareholder
Service Agreement between Registrant and BISYS Fund
Services Ohio, Inc.
C-4
<PAGE> 91
(formerly The Winsbury Service Corporation) dated
September 5, 1990 is incorporated by reference to Exhibit
9(g) to Post-Effective Amendment No. 16 to the Funds'
Registration Statement (filed December 17, 1997).
(9)(g) Amended Schedule A to Fund Accounting Agreement between
Registrant and BISYS Fund Services Ohio, Inc. (formerly,
The Winsbury Service Corporation) dated September 5, 1990,
as amended and restated May 12, 1995 is incorporated by
reference to Exhibit 9(h) to Post-Effective Amendment No.
16 to the Funds' Registration Statement (filed December
17, 1997).
(9)(h) Amended Schedule A to Sub-Administration Agreement between
BISYS Fund Services, LP (formerly, The Winsbury Company
Limited Partnership) and Bank of Oklahoma, N.A. (formerly,
BancOklahoma Trust Company) dated May 12, 1995 is
incorporated by reference to Exhibit 9(i) to
Post-Effective Amendment No. 16 to the Funds' Registration
Statement (filed December 17, 1997).
(9)(i) Form of Amended Schedule A to the Management and
Administration Agreement between Registrant and BISYS Fund
Services, LP (formerly The Winsbury Company Limited
Partnership) dated September 5, 1990, as amended and
restated on May 12, 1995 is filed herewith.
(9)(j) Form of Amended Schedule A to Transfer Agency and
Shareholder Service Agreement between Registrant and BISYS
Fund Services Ohio, Inc. (formerly The Winsbury Service
Corporation) dated September 5, 1990 is filed herewith.
(9)(k) Form of Amended Schedule A to Fund Accounting Agreement
between Registrant and BISYS Fund Services Ohio, Inc.
(formerly, The Winsbury Service Corporation) dated
September 5, 1990, as amended and restated May 12, 1995 is
filed herewith.
(9)(l) Form of Amended Schedule A to Sub-Administration Agreement
between BISYS Fund Services, LP (formerly, The Winsbury
Company Limited Partnership) and Bank of Oklahoma, N.A.
(formerly, BancOklahoma Trust Company) dated May 12, 1995
is filed herewith.
C-5
<PAGE> 92
(10) Opinion of Ropes & Gray is filed herewith.
(11)(a) Consent of KPMG Peat Marwick LLP is filed herewith.
(11)(b) Consent of Ropes & Gray is filed herewith.
(12) None.
(13) Purchase Agreement dated August 3, 1990 between Registrant
and Winsbury Associates is incorporated by reference to
Exhibit 13 to Post-Effective Amendment No. 1 to the Funds'
Registration Statement (filed October 31, 1990).
(14) None.
(15)(a) Amended and Restated Distribution and Shareholder Services
Plan dated October 1, 1993 is incorporated by reference to
Exhibit 15(a) to Post-Effective Amendment No. 7 to the
Funds' Registration Statement
(filed December 16, 1993).
(15)(b) Servicing Agreement with Respect to Shareholder Services
to be utilized in connection with Distribution and
Shareholder Services Plan is incorporated by reference to
Exhibit 15(b) to Pre-Effective Amendment No. 1 to the
Funds' Registration Statement (filed August 29, 1990).
(15)(c) Servicing Agreement with Respect to Distribution
Assistance and Shareholder Services to be utilized in
connection with Distribution and Shareholder Services Plan
is incorporated by reference to Exhibit 15(c) to
Pre-Effective Amendment No. 1 to the Funds' Registration
Statement (filed August 29, 1990).
(15)(d) Amended Schedule A to Amended and Restated Distribution
and Shareholder Services Plan dated October 1, 1993 is
incorporated by reference to Exhibit 15(e) to
Post-Effective Amendment No. 16 to the Funds' Registration
Statement (filed December 17, 1997).
(15)(e) Form of Amended Schedule A to Amended and Restated
Distribution and Shareholder Services Plan dated October
1, 1993 is filed herewith.
C-6
<PAGE> 93
(16)(a) Performance Calculations Schedules for every Fund (except
the Short-Term Income Fund, Balanced Fund and Growth
Equity Fund) are incorporated by reference to Exhibit 16
to Post-Effective Amendment No. 6 to the Funds'
Registration Statement (filed December 7, 1993).
(16)(b) Performance Calculations Schedules for the Short-Term
Income Fund and the Balanced Fund are incorporated by
reference to Exhibit 16(b) to Post-Effective Amendment No.
13 to the Funds' Registration Statement
(filed October 31, 1995).
(16)(c) Performance Calculations Schedules for the Growth Equity
Fund are incorporated by reference to Exhibit 16(c) to
Post-Effective Amendment No. 17 to the Funds' Registration
Statement (filed April 30, 1998).
(17) Financial Data Schedules, as follow, are filed herewith:
(a) Cash Management Fund
(b) U.S. Treasury Fund
(c) Bond Fund
(d) Intermediate Bond Fund
(e) Equity Fund
(f) Aggressive Growth Fund
(g) Intermediate Tax-Free Bond Fund
(h) Short-Term Income Fund
(i) Balanced Fund
(j) Growth Equity Fund
Item 25. Persons Controlled by or under Common Control with Registrant
-------------------------------------------------------------
There are no persons controlled or under common control with the
Registrant.
Item 26. Number of Holders of Securities
-------------------------------
Omitted per instructions of Letter from Barry D. Miller, Associate
Director, United States Securities and Exchange Commission, to Craig S.
Tyle, General Counsel, Investment Company Institute (October 2, 1998).
Item 27. Indemnification
---------------
Article VIII of Registrant's Agreement and Declaration of Trust, filed
or incorporated by reference as Exhibit (1) hereto, provides for the
indemnification of
C-7
<PAGE> 94
Registrant's trustees and officers. Indemnification of Registrant's
principal underwriter is provided for in the Agreement between
Registrant and that service provider as filed or incorporated by
reference as Exhibits hereto. As of the effective date of this
Registration Statement, Registrant has obtained from a major insurance
carrier a trustees and officers' liability policy covering certain
types of errors and omissions. In no event will Registrant indemnify
any of its trustees, officers, employees, or agents against any
liability to which such person would otherwise be subject by reason of
his willful misfeasance, bad faith, or gross negligence in the
performance of his duties, or by reason of his reckless disregard of
the duties involved in the conduct of his office or under his agreement
with Registrant. Registrant will comply with Rule 484 under the
Securities Act of 1933 and Release 11330 under the Investment Company
Act of 1940 in connection with any indemnification.
Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to trustees, officers, and controlling
persons of Registrant pursuant to the foregoing provisions, or
otherwise, Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by Registrant of expenses incurred or paid by a
trustee, officer or controlling person of Registrant in the successful
defense of any action, suit or proceeding) is asserted by such trustee,
officer, or controlling person in connection with the securities being
registered, Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such indemnification
by it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
Item 28. Business and Other Connections of Investment Adviser and Investment
-------------------------------------------------------------------
Sub-Adviser
-----------
Bank of Oklahoma, N.A. ("BOK") serves as Registrant's investment
adviser. AMR Investment Services, Inc. serves as the sub-investment
adviser to the American Performance Cash Management Fund.
To the knowledge of Registrant, none of the directors or officers of
BOK and AMR Investment Services, Inc. except those set forth below is
or has been, at any time during the past two calendar years, engaged in
any other business, profession, vocation or employment of a substantial
nature. Set forth below are the names and principal businesses of the
directors of BOK and AMR Investment Services, Inc.
C-8
<PAGE> 95
who are engaged in any other business, profession, vocation or
employment of a substantial nature.
<TABLE>
<CAPTION>
BANK OF OKLAHOMA, N.A.
----------------------
Name and Position With Other
Bank of Oklahoma Substantial Type of
N.A. Occupation Business
- ---------------------- ---------- --------
<S> <C> <C>
W. Wayne Allen Chairman and Chief Executive Oil
Director Officer, Phillips Petroleum
Company, 18 Phillips Building,
Bartlesville, OK 74004
Keith E. Bailey Chairman, President and Chief Oil, Gas and
Director Executive Officer, The Williams Telecommunications
Companies, Inc., P.O. Box 2400,
Tulsa, OK 74102
Glenn A. Cox (Retired President and Chief Oil
Director Operating Officer, Phillips
Petroleum Company), 401 SE
Dewey, Suite 318, Bartlesville,
OK 74003
Dr. Robert H. Donaldson (Former President, University of Education
Director Tulsa), 6449 S. Richmond, Tulsa,
OK 74136
James O. Goodwin Chief Executive Officer, The Publishing
Director Oklahoma Eagle Publ. Co., 624
East Archer, Tulsa, OK 74120
D. Joseph Graham Vice President and Chief Financial Oil
Director Officer, Kaiser-Francis Oil
Company, P.O. Box 21468, Tulsa,
OK 74121-1468
</TABLE>
C-9
<PAGE> 96
<TABLE>
<CAPTION>
BANK OF OKLAHOMA, N.A.
----------------------
Name and Position With Other
Bank of Oklahoma Substantial Type of
N.A. Occupation Business
- ---------------------- ---------- --------
<S> <C> <C>
V. Burns Hargis None
Director and Vice Chairman
Eugene A. Harris None
Director and Executive
Vice President
E. Carey Joullian IV President, Mustang Fuel Energy
Director Corporation, 2000 Classen Blvd.,
800E, Oklahoma City, OK 73106-
6036
George B. Kaiser President and Owner, Kaiser- Oil
Director and Francis Oil Co., P.O. Box 21468,
Chairman of the Board Tulsa, OK 74121-1468
David R. Lopez President, Oklahoma Telecommunications
Director Southwestern Bell Telephone, 800
North Harvey, Oklahoma City,
OK 73102
Stanley A. Lybarger None
Director, President and
Chief Executive Officer
Frank A. McPherson (Retired Chairman and Chief Oil
Director Executive Officer Kerr-McGee
Corporation), The Oil Center,
2601 Northwest Expressway,
Suite 805E, Oklahoma City, OK
73112
J. Larry Nichols Chief Executive Officer and Energy
Director President, Devon Energy
Corporation, 20 North Broadway,
Suite 1500, Oklahoma City, OK
73102-8260
</TABLE>
C-10
<PAGE> 97
<TABLE>
<CAPTION>
BANK OF OKLAHOMA, N.A.
----------------------
Name and Position With Other
Bank of Oklahoma Substantial Type of
N.A. Occupation Business
- ---------------------- ---------- --------
<S> <C> <C>
James W. Pielsticker President, Arrow Trucking Trucking
Director Company, 4230 South Elwood,
P.O. Box 3750, Tulsa, OK 74101
E.C. "Kip" Richards Senior Vice President of Oil
Director Operations, Sooner Pipe and
Supply Corporation,
MidContinent Tower, 10th Floor,
401 S. Boston, Tulsa, OK 74103
L. Francis Rooney, III Chairman and Chief Executive Construction
Director Officer, Manhattan Construction
Company, 111 W. 5th Street, Suite
1000, Tulsa, OK 74103-4253
James A. White None
Director, Executive Vice
President and Chief
Financial Officer
</TABLE>
The address of Bank of Oklahoma, N.A. is P.O. Box 2300, Tulsa, Oklahoma 74192.
The address of the BOK Financial Corporation is One Williams Center, Bank of
Oklahoma Tower, Tulsa, Oklahoma 74192.
<TABLE>
<CAPTION>
AMR INVESTMENT SERVICES, INC.
-----------------------------
Name and Position with Other Substantial Occupation Type of Business
- ---------------------- ---------------------------- ----------------
AMR
- ---
<S> <C> <C>
Robert L. Crandall Chairman, President and Chief Airline; Travel and
Director and Chairman Executive Officer, AMR Information Technology;
Corporation; Director, Chairman, Oil Service
and Chief Executive Officer,
American Airlines, Inc.; Director,
The Sabre Group, Inc. Mr.
Crandall also serves as an officer
and/or director of various
subsidiaries of AMR Corporation.
Director, Halliburton Company.
</TABLE>
C-11
<PAGE> 98
<TABLE>
<CAPTION>
AMR INVESTMENT SERVICES, INC.
-----------------------------
Name and Position with Other Substantial Occupation Type of Business
- ---------------------- ---------------------------- ----------------
AMR
- ---
<S> <C> <C>
Gerard J. Arpey Senior Vice President and Chief Airline; Travel and
Director and Vice Chairman Financial Officer, AMR Information Technology
Corporation; Director, The
Sabre Group, Inc. Mr. Arpey
also serves as an officer and/or
director of various subsidiaries
of AMR Corporation.
Jeffrey M. Jackson Vice President of Corporate Airline
Vice President and Treasurer Development and Treasurer,
AMR Corporation, (March
1995-Present); Vice President
of Corporate Development,
AMR Corporation. Mr. Jackson
also serves as an officer and/or
director of various subsidiaries
of AMR Corporation.
Charles D. Marlett Corporate Secretary, AMR Airline; Arts
Secretary Corporation; Corporate
Secretary, American Airlines,
Inc. Mr. Marlett also serves as
an officer and/or director of
various subsidiaries of AMR
Corporation. Director, Dallas
Summer Musicals.
Anne H. McNamara Senior Vice President and Airline; Travel and
Director General Counsel, AMR Information Technology;
Corporation; Senior Vice Energy
President, Administration and
General Counsel, American
Airlines, Inc.; Director, The
Sabre Group, Inc.; Ms.
McNamara also serves as an
officer and/or director of
various subsidiaries of AMR
Corporation. Director, LGE
Energy Corp.
</TABLE>
C-12
<PAGE> 99
<TABLE>
<CAPTION>
AMR INVESTMENT SERVICES, INC.
-----------------------------
Name and Position with Other Substantial Occupation Type of Business
- ---------------------- ---------------------------- ----------------
AMR
- ---
<S> <C> <C>
William F. Quinn President, AMR Investment Investment Adviser;
President Services, Inc.; Chairman and Credit Union; REIT;
Director, American Airlines Airline
Employees Federal Credit
Union. Mr. Quinn also serves
as an officer and/or director of
various subsidiaries of AMR
Corporation. Trustee and
President, AMR Investment
Services Trust, American
AAdvantage Funds, American
AAdvantage Mileage Funds;
Director, Crescent Real Estate
Equities, Inc.
</TABLE>
The address of each director or officer of AMR Investment Services,
Inc. is 4333 Amon Carter Boulevard, Ft. Worth, Texas 76155.
Item 29. Principal Underwriter
---------------------
(a) BISYS Fund Services, Limited Partnership acts as distributor and
administrator for Registrant. BISYS Fund Services also distributes the
securities of the following investment companies: Alpine Equity Trust,
AmSouth Mutual Funds, The ARCH Fund, Inc., The BB&T Mutual Funds
Group, The Coventry Group, ESC Strategic Funds, Inc., The Eureka
Funds, Fountain Square Funds, Hirtle Callaghan Trust, HSBC Family of
Funds, The Infinity Mutual Funds, Inc., INTRUST Funds Trust, The Kent
Funds, Magna Funds, Meyers Investment Trust, MMA Praxis Mutual Funds,
M.S.D.&T. Funds, Pacific Capital Funds, Parkstone Group of Funds, The
Parkstone Advantage Fund, Pegasus Funds, Puget Sound Alternative
Investment Series Trust, The Republic Funds Trust, The Republic
Advisors Funds Trust, The Riverfront Funds, Inc., SBSF Funds, Inc. dba
Key Mutual Funds, Sefton Funds, The Sessions Group, Summit Investment
Trust, Variable Insurance Funds, The Victory Portfolios, The Victory
Variable Funds, and Vintage Mutual Funds, Inc.
(b) Partners of BISYS Fund Services as of the date of this Part C are as
follows:
C-13
<PAGE> 100
<TABLE>
<CAPTION>
Positions and Positions and
Name and Principal Offices with Offices with
Business Address BISYS Fund Services Registrant
- ---------------- ------------------- ----------
<S> <C> <C>
BISYS Fund Services, Inc. Sole General Partner None
150 Clove Road
Little Falls, NJ 07424
WC Subsidiary Corporation Sole Limited Partner None
150 Clove Road
Little Falls, NJ 07424
Each of these corporations is a subsidiary of The BISYS Group, Inc., 150
Clove Road, Little Falls, NJ 07424.
Item 30. Location of Accounts and Records
--------------------------------
(1) Bank of Oklahoma, N.A., Bank of Oklahoma Tower, Tulsa,
Oklahoma 74103 (records relating to its functions as
Investment Adviser).
(2) AMR Investment Services, Inc., P.O. Box 619003, Dallas/Ft.
Worth Airport, Texas 75261- 9003 (records relating to its
function as Sub-Investment Adviser).
(3) BISYS Fund Services, LP, 3435 Stelzer Road, Columbus, Ohio
43219 (records relating to its functions as Administrator and
Distributor).
(4) BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus,
OH 43219 (records relating to its functions as Transfer Agent
and Fund Accountant).
(5) Bank of Oklahoma, N.A., Bank of Oklahoma Tower, Tulsa,
Oklahoma 74103 (records relating to its functions as
Custodian).
(6) Ropes & Gray, One Franklin Square, 1301 K Street, N.W., Suite
800 East, Washington, D.C. 20005 (Agreement and Declaration of
Trust, Bylaws and Minute Books).
Item 31. Management Services
-------------------
N/A.
</TABLE>
C-14
<PAGE> 101
Item 32. Undertakings
------------
(a) Registrant undertakes to call a meeting of shareholders, at
the request of holders of 10% of the Registrant's outstanding
shares, for the purpose of voting upon the question of removal
of a trustee or trustees and undertakes to assist in
communications with other shareholders as required by Section
16(c) of the Investment Company Act of 1940.
(b) The Registrant undertakes to furnish to each person to whom a
prospectus is delivered a copy of the Registrant's latest
annual report to shareholders upon request and without charge.
C-15
<PAGE> 102
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, as amended, the Registrant has duly caused this
Amendment No. 19 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Washington, District of
Columbia on the 4th day of December 1998.
American Performance Funds
Registrant
*/s/ WALTER B. GRIMM
--------------------
Walter B. Grimm
President
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 18 to the Registration Statement has been
signed below by the following persons in the capacity and on the date
indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
*/s/ WALTER B. GRIMM Chairman, President December 4, 1998
- -------------------- and Trustee
Walter B. Grimm
*/s/ JOEL ENGLE Treasurer December 4, 1998
- ---------------
Joel Engle
*/s/ MICHAEL J. HALL Trustee December 4, 1998
- --------------------
Michael J. Hall
*/s/ PERRY A. WIMPEY Trustee December 4, 1998
- --------------------
Perry A. Wimpey
*/s/ I. EDGAR HENDRIX Trustee December 4, 1998
- ---------------------
I. Edgar Hendrix
</TABLE>
* By: /s/ ALAN G. PRIEST
----------------------
Alan G. Priest, As
Attorney-in-Fact Pursuant
to Powers of Attorney Filed Herewith.
C-17
<PAGE> 103
POWER OF ATTORNEY
-----------------
Michael J. Hall, whose signature appears below, does hereby constitute
and appoint Martin E. Lybecker, Alan G. Priest, and Maryellen M. Lundquist, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable the American
Performance Funds (the "Trust"), to comply with the Investment Company Act of
1940, as amended, and the Securities Act of 1933, as amended ("Acts"), and any
rules, regulations or requirements of the Securities and Exchange Commission in
respect thereof, in connection with the filing and effectiveness of any and all
amendments to the Trust's Registration Statement on Form N-1A pursuant to said
Acts, including specifically, but without limiting the generality of the
foregoing, the power and authority to sign in the name and on behalf of the
undersigned as a trustee and/or officer of the Trust any and all such amendments
filed with the Securities and Exchange Commission under said Acts, and any other
instruments or documents related thereto, and the undersigned does hereby ratify
and confirm all that said attorneys and agents, or either of them, shall do or
cause to be done by virtue thereof.
Dated: July 25, 1997 /s/ MICHAEL J. HALL
-------------------------------
Michael J. Hall
<PAGE> 104
POWER OF ATTORNEY
-----------------
Perry A. Wimpey, whose signature appears below, does hereby constitute
and appoint Martin E. Lybecker, Alan G. Priest, and Maryellen M. Lundquist, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable the American
Performance Funds (the "Trust"), to comply with the Investment Company Act of
1940, as amended, and the Securities Act of 1933, as amended ("Acts"), and any
rules, regulations or requirements of the Securities and Exchange Commission in
respect thereof, in connection with the filing and effectiveness of any and all
amendments to the Trust's Registration Statement on Form N-1A pursuant to said
Acts, including specifically, but without limiting the generality of the
foregoing, the power and authority to sign in the name and on behalf of the
undersigned as a trustee and/or officer of the Trust any and all such amendments
filed with the Securities and Exchange Commission under said Acts, and any other
instruments or documents related thereto, and the undersigned does hereby ratify
and confirm all that said attorneys and agents, or either of them, shall do or
cause to be done by virtue thereof.
Dated: July 25, 1997 /s/ PERRY A. WIMPEY
-----------------------------
Perry A. Wimpey
<PAGE> 105
POWER OF ATTORNEY
-----------------
I. Edgar Hendrix, whose signature appears below, does hereby constitute
and appoint Martin E. Lybecker, Alan G. Priest, and Maryellen M. Lundquist, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable the American
Performance Funds (the "Trust"), to comply with the Investment Company Act of
1940, as amended, and the Securities Act of 1933, as amended ("Acts"), and any
rules, regulations or requirements of the Securities and Exchange Commission in
respect thereof, in connection with the filing and effectiveness of any and all
amendments to the Trust's Registration Statement on Form N-1A pursuant to said
Acts, including specifically, but without limiting the generality of the
foregoing, the power and authority to sign in the name and on behalf of the
undersigned as a trustee and/or officer of the Trust any and all such amendments
filed with the Securities and Exchange Commission under said Acts, and any other
instruments or documents related thereto, and the undersigned does hereby ratify
and confirm all that said attorneys and agents, or either of them, shall do or
cause to be done by virtue thereof.
Dated: July 25, 1997 /s/ I. EDGAR HENDRIX
-----------------------------
I. Edgar Hendrix
<PAGE> 106
POWER OF ATTORNEY
-----------------
Walter B. Grimm, whose signature appears below, does hereby constitute
and appoint Martin E. Lybecker, Alan G. Priest, and Maryellen M. Lundquist, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable the American
Performance Funds (the "Trust"), to comply with the Investment Company Act of
1940, as amended, and the Securities Act of 1933, as amended ("Acts"), and any
rules, regulations or requirements of the Securities and Exchange Commission in
respect thereof, in connection with the filing and effectiveness of any and all
amendments to the Trust's Registration Statement on Form N-1A pursuant to said
Acts, including specifically, but without limiting the generality of the
foregoing, the power and authority to sign in the name and on behalf of the
undersigned as a trustee and/or officer of the Trust any and all such amendments
filed with the Securities and Exchange Commission under said Acts, and any other
instruments or documents related thereto, and the undersigned does hereby ratify
and confirm all that said attorneys and agents, or either of them, shall do or
cause to be done by virtue thereof.
Dated: July 25, 1997 /s/ WALTER B. GRIMM
-----------------------------
Walter B. Grimm
<PAGE> 107
POWER OF ATTORNEY
-----------------
Joel Engle, whose signature appears below, does hereby constitute and
appoint Martin E. Lybecker, Alan G. Priest, and Alyssa Albertelli, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable the American
Performance Funds (the "Trust"), to comply with the Investment Company Act of
1940, as amended, and the Securities Act of 1933, as amended ("Acts"), and any
rules, regulations or requirements of the Securities and Exchange Commission in
respect thereof, in connection with the filing and effectiveness of any and all
amendments to the Trust's Registration Statement on Form N-1A pursuant to said
Acts, including specifically, but without limiting the generality of the
foregoing, the power and authority to sign in the name and on behalf of the
undersigned as a trustee and/or officer of the Trust any and all such amendments
filed with the Securities and Exchange Commission under said Acts, and any other
instruments or documents related thereto, and the undersigned does hereby ratify
and confirm all that said attorneys and agents, or either of them, shall do or
cause to be done by virtue thereof.
Dated: October 30, 1998 /s/ JOEL ENGLE
---------------------------
Joel Engle
<PAGE> 108
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description Page No.
--- ----------- --------
<S> <C> <C>
(5)(d) Form of Amended Schedule A to the Investment Advisory
Agreement
(6)(c) Form of Amended Schedules A and B to the Distribution
Agreement
(8)(c) Form of Amended Schedule A to the Custodian Agreement
(9)(i) Form of Amended Schedule A to the Management and
Administration Agreement
(9)(j) Form of Amended Schedule A to the Transfer Agency and
Shareholder Service Agreement
(9)(k) Form of Amended Schedule A to the Fund Accounting
Agreement
(9)(l) Form of Amended Schedule A to the Sub-Administration
Agreement
(10) Opinion of Ropes & Gray.
(11)(a) Consent of KPMG Peat Marwick LLP.
(11)(b) Consent of Ropes & Gray.
(15)(e) Form of Amended Schedule A to Amended and Restated
Distribution and Shareholder Services Plan
(27) Financial Data Schedules
(a) Cash Management Fund
(b) U.S. Treasury Fund
(c) Bond Fund
(d) Intermediate Bond Fund
(e) Equity Fund
(f) Aggressive Growth Fund
(g) Intermediate Tax-Free Bond Fund
(h) Short-Term Income Fund
(i) Balanced Fund
(j) Growth Equity Fund
</TABLE>
<PAGE> 1
Exhibit 5(d)
<TABLE>
Form of Amended Schedule A
to the Investment Advisory Agreement between
American Performance Funds and Bank of Oklahoma, N.A.
dated July 25, 1997
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance U.S. Annual rate of forty one-hundredths of one percent
Treasury Fund (.40%) of American Performance U.S. Treasury Fund's
average daily net assets.
American Performance Cash Annual rate of forty one-hundredths of one percent
Management Fund (.40%) of American Performance Cash Management
Fund's average daily net assets.
American Performance Bond Annual rate of fifty-five one-hundredths of one percent
Fund (.55%) of American Performance Bond Fund's average
daily net assets.
American Performance Annual rate of fifty-five one-hundredths of one percent
Intermediate Bond Fund (.55%) of American Performance Intermediate Bond
Fund's average daily net assets.
American Performance Annual rate of fifty-five one-hundredths of one percent
Intermediate Tax-Free (.55%) of American Performance Intermediate Tax-Free
Bond Fund Bond Fund's average daily net assets.
American Performance Annual rate of fifty-five one-hundredths of one percent
Short-Term Income Fund (.55%) of American Performance Short-Term Income
Fund's average daily net assets.
American Performance Equity Annual rate of sixty-nine one-hundredths of one percent
Fund (.69%) of American Performance Equity Fund's average
daily net assets.
American Performance Annual rate of sixty-nine one-hundredths of one percent
Aggressive Growth Fund (.69%) of American Performance Aggressive Growth
Fund's average daily net assets.
</TABLE>
A-1
<PAGE> 2
<TABLE>
Form of Amended Schedule A (continued)
to the Investment Advisory Agreement between
American Performance Funds and Bank of Oklahoma, N.A.
dated July 25, 1997
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance Annual rate of seventy-four one-hundredths of one
Balanced Fund percent (.74%) of American Performance
Balanced Fund's average daily net assets.
American Performance Annual rate of sixty-nine one-hundredths of one
Growth Equity Fund pecent (.69%) of American Performance Growth
Equity Fund's average daily net assets.
American Performance Annual rate of sixty-nine one-hundredths of one
Small Cap Equity Fund percent (.69%) of American Performance
Small Cap Equity Fund's average daily net assets.
[SEAL] American Performance Funds
By:
-------------------------------
Date: , 1999
----------------------
[SEAL] Bank of Oklahoma, N.A.
By:
-------------------------------
Date: , 1999
----------------------
</TABLE>
- -------------
* All fees are computed daily and paid monthly.
A-2
<PAGE> 1
Exhibit 6(c)
Form of Amended Schedule A
to the Distribution Agreement
between American Performance Funds and
BISYS Fund Services Limited Partnership
(formerly, The Winsbury Company Limited Partnership)
dated October 1, 1993
Name of Fund
- ------------
American Performance U.S. Treasury Fund
American Performance Cash Management Fund
American Performance Bond Fund
American Performance Intermediate Bond Fund
American Performance Intermediate Tax-Free Bond Fund
American Performance Equity Fund
American Performance Aggressive Growth Fund
American Performance Short-Term Income Fund
American Performance Balanced Fund
American Performance Growth Equity Fund
American Performance Small Cap Equity Fund
American Performance Funds
By:
---------------------------
Title:
------------------------
Date: , 1999
------------------
BISYS Fund Services Limited Partnership
By: BISYS Fund Services, Inc.
General Partner
By:
---------------------------
Title:
------------------------
Date: , 1999
------------------
<PAGE> 2
Form of Amended Schedule B
to the Distribution Agreement
between American Performance Funds and
BISYS Fund Services Limited Partnership
(formerly, The Winsbury Company Limited Partnership)
dated October 1, 1993
Name of Load Fund
- -----------------
American Performance Bond Fund
American Performance Intermediate Bond Fund
American Performance Intermediate Tax-Free Bond Fund
American Performance Equity Fund
American Performance Aggressive Growth Fund
American Performance Short-Term Income Fund
American Performance Balanced Fund
American Performance Growth Equity Fund
American Performance Small Cap Equity Fund
American Performance Funds
By:
---------------------------
Title:
------------------------
Date: , 1999
------------------
BISYS Fund Services Limited Partnership
By: BISYS Fund Services, Inc.
General Partner
By:
---------------------------
Title:
------------------------
Date: , 1999
------------------
<PAGE> 1
Exhibit 8(c)
Form of Amended Schedule A
to the Custodian Agreement
between American Performance Funds and
Bank of Oklahoma, N.A.
September 5, 1990
Name of Fund
- ------------
American Performance Cash Management Fund
American Performance U.S. Treasury Fund
American Performance Bond Fund
American Performance Intermediate Bond Fund
American Performance Intermediate Tax-Free Bond Fund
American Performance Equity Fund
American Performance Aggressive Growth Fund
American Performance Short-Term Income Fund
American Performance Balanced Fund
American Performance Growth Equity Fund
American Performance Small Cap Equity Fund
American Performance Funds
By:
---------------------------
Date: , 1999
------------------
Bank of Oklahoma, N.A.
By:
---------------------------
Date: , 1999
------------------
<PAGE> 1
Exhibit 9(i)
Form of Schedule A
to the Amended and Restated Management and Administration Agreement
between American Performance Funds and
BISYS Fund Services Limited Partnership
(Formerly, The Winsbury Company Limited Partnership)
dated May 12, 1995
<TABLE>
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance Cash Management Fund Annual rate of twenty one-hundredths of one percent (.20%)
of American Performance Cash Management Fund's average daily
net assets.
American Performance U.S. Treasury Fund Annual rate of twenty one-hundredths of one percent (.20%) of
American Performance U.S. Treasury Fund's average daily net assets.
American Performance Bond Fund Annual rate of twenty one-hundredths of one percent (.20%)
of American Performance Bond Fund's average daily net assets.
American Performance Intermediate Bond Fund Annual rate of twenty one-hundredths of one percent (.20%)
of American Performance Intermediate Bond Fund's average
daily net assets.
American Performance Intermediate Tax-Free Annual rate of twenty one-hundredths of one percent (.20%)
Bond Fund of American Performance Intermediate Tax-Free Bond Fund's
average daily net assets.
</TABLE>
<PAGE> 2
Form of Schedule A (Continued)
to the Amended and Restated Management and Administration Agreement
between American Performance Funds and
BISYS Fund Services Limited Partnership
(Formerly, The Winsbury Company Limited Partnership)
dated May 12, 1995
<TABLE>
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance Equity Fund Annual rate of twenty one-hundredths of one percent (.20%)
of American Performance Equity Fund's average daily net assets.
American Performance Aggressive Growth Fund Annual rate of twenty one- hundredths of one percent (.20%) of
American Performance Aggressive Growth Fund's average daily net
assets.
American Performance Short-Term Income Fund Annual rate of twenty one-hundredths of one percent (.20%) of
American Performance Short-Term Income Fund's average daily net
assets.
American Performance Balanced Fund Annual rate of twenty one-hundredths of one percent (.20%) of
American Performance Balanced Fund's average daily net assets.
</TABLE>
-2-
<PAGE> 3
Form of Schedule A (Continued)
to the
Amended and Restated Management and Administration Agreement
between American Performance Funds and
BISYS Fund Services Limited Partnership
(Formerly, The Winsbury Company Limited Partnership)
dated May 12, 1995
<TABLE>
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance Growth Equity Fund Annual rate of twenty one-hundredths of one percent (.20%) of
American Performance Growth Equity Fund's average daily net
assets.
American Performance Small Cap Equity Fund Annual rate of twenty one- hundredths of one percent (.20%) of
American Performance Small Cap Equity Fund's average daily net
assets.
</TABLE>
American Performance Funds
By:
---------------------------------
Title:
-------------------------------
Date: , 1999
---------------------------
BISYS Fund Services Limited Partnership
By: BISYS Fund Services, Inc.
General Partner
By:
---------------------------------
Title:
-------------------------------
Date: , 1999
---------------------------
- -----------
* All fees are computed daily and paid periodically.
-3-
<PAGE> 1
Exhibit 9(j)
Form of Amended Schedule A
to the
Transfer Agency and Shareholder Service Agreement
Between BISYS Fund Services Ohio, Inc.
(formerly, The Winsbury Service Corporation)
and American Performance Funds
Dated September 5, 1990
NAME OF FUND
------------
American Performance U.S. Treasury Fund
American Performance Cash Management Fund
American Performance Bond Fund
American Performance Intermediate Bond Fund
American Performance Intermediate Tax-Free Bond Fund
American Performance Equity Fund
American Performance Aggressive Growth Fund
American Performance Short-Term Income Fund
American Performance Balanced Fund
American Performance Growth Equity Fund
American Performance Small Cap Equity Fund
American Performance Funds
By:
-----------------------
Date: , 1999 Title:
------------------ --------------------
BISYS Fund Services Ohio, Inc.
By:
-----------------------
Date: , 1999 Title:
------------------ --------------------
<PAGE> 1
Exhibit 9(k)
Form of Amended Schedule A
to the
Fund Accounting Agreement
between BISYS Fund Services Ohio, Inc.
(formerly the Winsbury Service Corporation) and
American Performance Funds
as amended and restated May 12, 1995
NAME OF THE FUND
----------------
American Performance U.S. Treasury Fund
American Performance Cash Management Fund
American Performance Bond Fund
American Performance Intermediate Bond Fund
American Performance Intermediate Tax-Free Bond Fund
American Performance Equity Fund
American Performance Aggressive Growth Fund
American Performance Short-Term Income Fund
American Performance Balanced Fund
American Performance Growth Equity Fund
American Performance Small Cap Equity Fund
American Performance Funds
By:
-----------------------------
Date: , 1999
--------------------
BISYS Fund Services Ohio, Inc.
By:
-----------------------------
Date: , 1999
--------------------
<PAGE> 1
Exhibit 9(l)
FORM OF SCHEDULE A
TO THE SUB-ADMINISTRATION AGREEMENT
BETWEEN
BISYS FUND SERVICES LIMITED PARTNERSHIP
AND BANK OF OKLAHOMA, N.A.
DATED JULY 25, 1997
NAME OF FUND
------------
American Performance U.S. Treasury Fund
American Performance Cash Management Fund
American Performance Bond Fund
American Performance Intermediate Bond Fund
American Performance Short-Term Income Fund
American Performance Intermediate Tax-Free Bond Fund
American Performance Equity Fund
American Performance Aggressive Growth Fund
American Performance Balanced Fund
American Performance Growth Equity Fund
American Performance Small Cap Equity Fund
BISYS FUND SERVICES LIMITED
PARTNERSHIP
By: BISYS Fund Services, Inc.
General Partner
By:
----------------------------
Title:
-------------------------
Date: , 1999
-----------------
BANK OF OKLAHOMA, N.A.
By:
----------------------------
Title:
-------------------------
Date: , 1999
-----------------
<PAGE> 1
EXHIBIT (10)
Opinion of Ropes & Gray
<PAGE> 2
Ropes & Gray
One Franklin Square
1301 K Street, N.W., Suite 800 East
Washington, D.C. 20005
WRITER'S DIRECT DIAL NUMBER: (202) 626-3925
December 4, 1998
American Performance Funds
3435 Stelzer Road
Columbus, Ohio 43219
Gentlemen:
You have registered under the Securities Act of 1933, as amended (the
"1933 Act") an indefinite number of shares of beneficial interest ("Shares") of
the American Performance Funds ("Trust"), as permitted by Rule 24f-2 under the
Investment Company Act of 1940, as amended (the "1940 Act"). You propose to file
a post-effective amendment on Form N-1A (the "Post-Effective Amendment") to your
Registration Statement as required by Section 10(a)(3) of the 1933 Act and the
Rules thereunder and Section 8(b) of the 1940 Act and the rules thereunder.
We have examined your Agreement and Declaration of Trust on file in the
office of the Secretary of The Commonwealth of Massachusetts and the Clerk of
the City of Boston. We have also examined a copy of your Bylaws and such other
documents, receipts and records as we have deemed necessary for the purpose of
this opinion.
Based upon the foregoing, we are of the opinion that the issue and sale
of the authorized but unissued Shares of each Fund of the Trust described in
said Registration Statement (each a "Series") have been duly authorized under
Massachusetts law. Upon the original issue and sale of your authorized but
unissued Shares and upon receipt of the authorized consideration therefor in an
amount not less than the net asset value of the Shares established and in force
at the time of their sale, the Shares issued will be validly issued, fully paid
and non-assessable.
<PAGE> 3
American Performance Funds
December 4, 1998
Page 2
The American Performance Funds is an entity of the type commonly known
as a "Massachusetts business trust." Under Massachusetts law, shareholders
could, under certain circumstances, be held personally liable for the
obligations of the Trust. However, the Agreement and Declaration of Trust
provides for indemnification out of the property of a particular series of
Shares for all loss and expenses of any shareholder of that series held
personally liable solely by reason of his being or having been a shareholder.
Thus, the risk of shareholder liability is limited to circumstances in which
that series of Shares itself would be unable to meet its obligations.
We understand that this opinion is to be used in connection with the
filing of the Post-Effective Amendment. We consent to the filing of this opinion
with and as part of your Post-Effective Amendment.
Sincerely,
/s/ Ropes & Gray
----------------
Ropes & Gray
<PAGE> 1
EXHIBIT (11)(a)
Consent of KPMG Peat Marwick LLP
<PAGE> 2
INDEPENDENT AUDITORS' CONSENT
The Board of Trustees of
American Performance Funds
We consent to the use of our report dated October 9, 1998 for the
American Performance Funds as incorporated by reference herein and to the
reference to our firm under the heading "Auditors" in the Statement of
Additional Information.
/s/ KPMG Peat Marwick LLP
-------------------------
KPMG Peat Marwick LLP
Columbus, Ohio
December 4, 1998
<PAGE> 1
EXHIBIT (11)(b)
Consent of Ropes & Gray
<PAGE> 2
CONSENT OF COUNSEL
We hereby consent to the use of our name and the references to our firm
under the caption "Legal Counsel" included in or made a part of Post-Effective
Amendment No. 19 to the Registration Statement of the American Performance Funds
on Form N-1A under the Securities Act of 1933, as amended.
/s/ ROPES & GRAY
----------------
ROPES & GRAY
Washington, D.C.
December 4, 1998
<PAGE> 1
Exhibit 15(e)
FORM OF SCHEDULE A
TO THE AMENDED AND RESTATED
DISTRIBUTION AND SHAREHOLDER SERVICES PLAN
BETWEEN THE AMERICAN PERFORMANCE FUNDS AND
BISYS FUND SERVICES LIMITED PARTNERSHIP
(FORMERLY, THE WINSBURY COMPANY LIMITED PARTNERSHIP)
DATED OCTOBER 1, 1993
<TABLE>
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance Cash Annual rate of twenty-five one-hundredths
Management Fund of one percent (.25%) of American Performance
Cash Management Fund's average daily net assets.
American Performance U.S. Annual rate of twenty-five one-hundredths
Treasury Fund of one percent (.25%) of American Performance
U.S. Treasury Fund's average daily net assets.
American Performance Annual rate of twenty-five one-hundredths
Bond Fund of one percent (.25%) of American Performance
Bond Fund's average daily net assets.
American Performance Annual rate of twenty-five one-hundredths
Intermediate Bond Fund of one percent (.25%) of American Performance
Intermediate Bond Fund's average daily net assets.
American Performance Annual rate of twenty-five one-hundredths
Intermediate Tax-Free Bond Fund of one percent (.25%) of American Performance
Intermediate Tax-Free Bond Fund's average
daily net assets.
American Performance Annual rate of twenty-five one-hundredths
Equity Fund of one percent (.25%) of American Performance
Equity Fund's average daily net assets.
</TABLE>
<PAGE> 2
FORM OF SCHEDULE A (CONTINUED)
TO THE AMENDED AND RESTATED
DISTRIBUTION AND SHAREHOLDER SERVICES PLAN
BETWEEN THE AMERICAN PERFORMANCE FUNDS AND
BISYS FUND SERVICES LIMITED PARTNERSHIP
(FORMERLY, THE WINSBURY COMPANY LIMITED PARTNERSHIP)
DATED OCTOBER 1, 1993
<TABLE>
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance Annual rate of twenty-five one-hundredths
Aggressive Growth Fund of one percent (.25%) of American Performance
Aggressive Growth Fund's average daily net assets.
American Performance Annual rate of twenty-five one-hundredths
Short-Term Income Fund of one percent (.25%) of American Performance
Short-Term Income Fund's average daily net assets.
American Performance Annual rate of twenty-five one-hundredths
Balanced Fund of one percent (.25%) of American Performance
Balanced Fund's average daily net assets.
American Performance Annual rate of twenty-five one-hundredths
Growth Equity Fund of one percent (.25%) of American Performance
Growth Equity Fund's average daily net assets.
</TABLE>
-2-
<PAGE> 3
FORM OF SCHEDULE A (CONTINUED)
TO THE AMENDED AND RESTATED
DISTRIBUTION AND SHAREHOLDER SERVICES PLAN
BETWEEN THE AMERICAN PERFORMANCE FUNDS AND
BISYS FUND SERVICES LIMITED PARTNERSHIP
(FORMERLY, THE WINSBURY COMPANY LIMITED PARTNERSHIP)
DATED OCTOBER 1, 1993
<TABLE>
<CAPTION>
NAME OF FUND COMPENSATION*
- ------------ -------------
<S> <C>
American Performance Annual rate of twenty-five one-hundredths
Small Cap Equity Fund of one percent (.25%) of American Performance
Small Cap Equity Fund's average daily net assets.
</TABLE>
[SEAL] AMERICAN PERFORMANCE FUNDS
By:
-----------------------------
Title:
--------------------------
Date: , 1999
--------------------
BISYS FUND SERVICES LIMITED
PARTNERSHIP
By: BISYS Fund Services, Inc.,
General Partner
By:
-----------------------------
Title:
--------------------------
Date: , 1999
--------------------
* All fees are computed daily and paid monthly.
-3-
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 01
<NAME> CASH MANAGEMENT FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 465767794
<INVESTMENTS-AT-VALUE> 465767794
<RECEIVABLES> 3004339
<ASSETS-OTHER> 2831
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 468774964
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2204236
<TOTAL-LIABILITIES> 2204236
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 466563221
<SHARES-COMMON-STOCK> 466563221
<SHARES-COMMON-PRIOR> 331100389
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 7507
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 466570728
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 23362263
<OTHER-INCOME> 0
<EXPENSES-NET> 2894088
<NET-INVESTMENT-INCOME> 20468175
<REALIZED-GAINS-CURRENT> 12486
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 20480661
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 20468175
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1129291958
<NUMBER-OF-SHARES-REDEEMED> 993854941
<SHARES-REINVESTED> 25815
<NET-CHANGE-IN-ASSETS> 135475318
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 4977
<OVERDIST-NET-GAINS-PRIOR> 2
<GROSS-ADVISORY-FEES> 1630192
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3912958
<AVERAGE-NET-ASSETS> 407551159
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.05
<PER-SHARE-GAIN-APPREC> 0.00
<PER-SHARE-DIVIDEND> 0.05
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.71
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 02
<NAME> U.S. TREASURY FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 390085758
<INVESTMENTS-AT-VALUE> 390085758
<RECEIVABLES> 66824
<ASSETS-OTHER> 3057
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 390155639
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1836668
<TOTAL-LIABILITIES> 1836668
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 388311039
<SHARES-COMMON-STOCK> 388311038
<SHARES-COMMON-PRIOR> 298381286
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 7932
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 388318971
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 20758785
<OTHER-INCOME> 0
<EXPENSES-NET> 2694979
<NET-INVESTMENT-INCOME> 18063806
<REALIZED-GAINS-CURRENT> 21082
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 18084888
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 18063806
<DISTRIBUTIONS-OF-GAINS> 56293
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1070787836
<NUMBER-OF-SHARES-REDEEMED> 980900895
<SHARES-REINVESTED> 42811
<NET-CHANGE-IN-ASSETS> 89894541
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 43143
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1495245
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3629510
<AVERAGE-NET-ASSETS> 373828833
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.48
<PER-SHARE-GAIN-APPREC> 0.00
<PER-SHARE-DIVIDEND> 0.48
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.72
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 03
<NAME> BOND FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 50358534
<INVESTMENTS-AT-VALUE> 52701259
<RECEIVABLES> 682962
<ASSETS-OTHER> 1963
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 53386184
<PAYABLE-FOR-SECURITIES> 383132
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 297041
<TOTAL-LIABILITIES> 680173
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 50520944
<SHARES-COMMON-STOCK> 5402892
<SHARES-COMMON-PRIOR> 3815832
<ACCUMULATED-NII-CURRENT> 9225
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 166883
<ACCUM-APPREC-OR-DEPREC> 2342725
<NET-ASSETS> 52706011
<DIVIDEND-INCOME> 48001
<INTEREST-INCOME> 3195730
<OTHER-INCOME> 0
<EXPENSES-NET> 446937
<NET-INVESTMENT-INCOME> 2796794
<REALIZED-GAINS-CURRENT> 293685
<APPREC-INCREASE-CURRENT> 1891340
<NET-CHANGE-FROM-OPS> 4981819
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 2796794
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2260859
<NUMBER-OF-SHARES-REDEEMED> 835283
<SHARES-REINVESTED> 161484
<NET-CHANGE-IN-ASSETS> 17251860
<ACCUMULATED-NII-PRIOR> 17925
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 461389
<GROSS-ADVISORY-FEES> 255391
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 539807
<AVERAGE-NET-ASSETS> 46482023
<PER-SHARE-NAV-BEGIN> 9.29
<PER-SHARE-NII> 0.57
<PER-SHARE-GAIN-APPREC> 0.47
<PER-SHARE-DIVIDEND> 0.57
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 9.76
<EXPENSE-RATIO> 0.96
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 04
<NAME> INTERMEDIATE BOND FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 82902577
<INVESTMENTS-AT-VALUE> 85273869
<RECEIVABLES> 856997
<ASSETS-OTHER> 1886
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 86131752
<PAYABLE-FOR-SECURITIES> 288908
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 461187
<TOTAL-LIABILITIES> 750095
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 83650736
<SHARES-COMMON-STOCK> 8128014
<SHARES-COMMON-PRIOR> 7555440
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 35792
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 604579
<ACCUM-APPREC-OR-DEPREC> 2371292
<NET-ASSETS> 85381657
<DIVIDEND-INCOME> 41907
<INTEREST-INCOME> 5494846
<OTHER-INCOME> 0
<EXPENSES-NET> 772942
<NET-INVESTMENT-INCOME> 4763811
<REALIZED-GAINS-CURRENT> 122855
<APPREC-INCREASE-CURRENT> 1996594
<NET-CHANGE-FROM-OPS> 6883260
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4763811
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1504780
<NUMBER-OF-SHARES-REDEEMED> 1090310
<SHARES-REINVESTED> 158104
<NET-CHANGE-IN-ASSETS> 8063105
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 19520
<OVERDIST-NET-GAINS-PRIOR> 743706
<GROSS-ADVISORY-FEES> 447017
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 935494
<AVERAGE-NET-ASSETS> 81294854
<PER-SHARE-NAV-BEGIN> 10.23
<PER-SHARE-NII> 0.61
<PER-SHARE-GAIN-APPREC> 0.27
<PER-SHARE-DIVIDEND> 0.61
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 10.50
<EXPENSE-RATIO> 0.95
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 05
<NAME> EQUITY FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 138944012
<INVESTMENTS-AT-VALUE> 166770427
<RECEIVABLES> 341653
<ASSETS-OTHER> 2752
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 167114832
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 150297
<TOTAL-LIABILITIES> 150297
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 128880834
<SHARES-COMMON-STOCK> 11084948
<SHARES-COMMON-PRIOR> 9861376
<ACCUMULATED-NII-CURRENT> 112541
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 10144745
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 27826415
<NET-ASSETS> 166964535
<DIVIDEND-INCOME> 2954358
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 2088233
<NET-INVESTMENT-INCOME> 866125
<REALIZED-GAINS-CURRENT> 17019219
<APPREC-INCREASE-CURRENT> (14850993)
<NET-CHANGE-FROM-OPS> 3034351
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 755719
<DISTRIBUTIONS-OF-GAINS> 25074277
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1738159
<NUMBER-OF-SHARES-REDEEMED> 2121689
<SHARES-REINVESTED> 1607102
<NET-CHANGE-IN-ASSETS> (3921992)
<ACCUMULATED-NII-PRIOR> 2135
<ACCUMULATED-GAINS-PRIOR> 18199803
<OVERDISTRIB-NII-PRIOR> 0
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<GROSS-ADVISORY-FEES> 1344396
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2458429
<AVERAGE-NET-ASSETS> 194829333
<PER-SHARE-NAV-BEGIN> 17.33
<PER-SHARE-NII> 0.08
<PER-SHARE-GAIN-APPREC> 0.19
<PER-SHARE-DIVIDEND> 0.07
<PER-SHARE-DISTRIBUTIONS> 2.47
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 15.06
<EXPENSE-RATIO> 1.07
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 06
<NAME> AGGRESSIVE GROWTH FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 30919446
<INVESTMENTS-AT-VALUE> 22984502
<RECEIVABLES> 30925
<ASSETS-OTHER> 2024
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 23017451
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 19722
<TOTAL-LIABILITIES> 19722
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 19808546
<SHARES-COMMON-STOCK> 2080770
<SHARES-COMMON-PRIOR> 3123579
<ACCUMULATED-NII-CURRENT> 7443
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 11116684
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (7934944)
<NET-ASSETS> 22997729
<DIVIDEND-INCOME> 296286
<INTEREST-INCOME> 63319
<OTHER-INCOME> 0
<EXPENSES-NET> 473873
<NET-INVESTMENT-INCOME> (114273)
<REALIZED-GAINS-CURRENT> 13100218
<APPREC-INCREASE-CURRENT> (24766819)
<NET-CHANGE-FROM-OPS> (11780874)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 7598060
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<NUMBER-OF-SHARES-SOLD> 2897199
<NUMBER-OF-SHARES-REDEEMED> 4470281
<SHARES-REINVESTED> 530273
<NET-CHANGE-IN-ASSETS> (35984300)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 5760350
<OVERDISTRIB-NII-PRIOR> 24108
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<GROSS-EXPENSE> 555633
<AVERAGE-NET-ASSETS> 42930341
<PER-SHARE-NAV-BEGIN> 18.88
<PER-SHARE-NII> (0.06)
<PER-SHARE-GAIN-APPREC> (5.18)
<PER-SHARE-DIVIDEND> 2.59
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 11.05
<EXPENSE-RATIO> 1.10
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 07
<NAME> INTERMEDIATE TAX-FREE FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 28672123
<INVESTMENTS-AT-VALUE> 30189892
<RECEIVABLES> 384929
<ASSETS-OTHER> 1460
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 30576281
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 122575
<TOTAL-LIABILITIES> 122575
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 28825159
<SHARES-COMMON-STOCK> 2770180
<SHARES-COMMON-PRIOR> 2462508
<ACCUMULATED-NII-CURRENT> 15281
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 95497
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1517769
<NET-ASSETS> 30453706
<DIVIDEND-INCOME> 25354
<INTEREST-INCOME> 1460444
<OTHER-INCOME> 0
<EXPENSES-NET> 210889
<NET-INVESTMENT-INCOME> 1274909
<REALIZED-GAINS-CURRENT> 137152
<APPREC-INCREASE-CURRENT> 602188
<NET-CHANGE-FROM-OPS> 2014249
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1274909
<DISTRIBUTIONS-OF-GAINS> 181702
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<NUMBER-OF-SHARES-SOLD> 766891
<NUMBER-OF-SHARES-REDEEMED> 491985
<SHARES-REINVESTED> 32766
<NET-CHANGE-IN-ASSETS> 3909897
<ACCUMULATED-NII-PRIOR> 15281
<ACCUMULATED-GAINS-PRIOR> 140047
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 157712
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 339926
<AVERAGE-NET-ASSETS> 28685576
<PER-SHARE-NAV-BEGIN> 10.78
<PER-SHARE-NII> 0.48
<PER-SHARE-GAIN-APPREC> 0.28
<PER-SHARE-DIVIDEND> 0.48
<PER-SHARE-DISTRIBUTIONS> 0.07
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 10.99
<EXPENSE-RATIO> 0.74
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 08
<NAME> SHORT TERM INCOME FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
<PERIOD-END> AUG-31-1998
<INVESTMENTS-AT-COST> 33426019
<INVESTMENTS-AT-VALUE> 33861598
<RECEIVABLES> 239315
<ASSETS-OTHER> 1983
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 34102896
<PAYABLE-FOR-SECURITIES> 1540392
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 172767
<TOTAL-LIABILITIES> 1713159
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 31946578
<SHARES-COMMON-STOCK> 3201355
<SHARES-COMMON-PRIOR> 1578925
<ACCUMULATED-NII-CURRENT> 2535
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 5045
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 435579
<NET-ASSETS> 32389737
<DIVIDEND-INCOME> 34523
<INTEREST-INCOME> 1372252
<OTHER-INCOME> 0
<EXPENSES-NET> 88544
<NET-INVESTMENT-INCOME> 1318231
<REALIZED-GAINS-CURRENT> 45164
<APPREC-INCREASE-CURRENT> 392685
<NET-CHANGE-FROM-OPS> 1756080
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1318231
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1986244
<NUMBER-OF-SHARES-REDEEMED> 433553
<SHARES-REINVESTED> 69739
<NET-CHANGE-IN-ASSETS> 16731527
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 7371
<OVERDIST-NET-GAINS-PRIOR> 30213
<GROSS-ADVISORY-FEES> 117712
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 261877
<AVERAGE-NET-ASSETS> 21448053
<PER-SHARE-NAV-BEGIN> 9.92
<PER-SHARE-NII> 0.62
<PER-SHARE-GAIN-APPREC> 0.20
<PER-SHARE-DIVIDEND> 0.62
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 10.12
<EXPENSE-RATIO> 0.41
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000864508
<NAME> AMERICAN PERFORMANCE FUNDS
<SERIES>
<NUMBER> 09
<NAME> BALANCED FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-START> SEP-01-1997
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