-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VX1WusIBZ+UqSGHUK3TPjl9O4SJC+Kk+u0O2l8vfDG0tGIuCV/XemY6MkQ4TSHVd jvAFDzJKLfG8DLpQDThDhQ== 0001035449-04-000566.txt : 20041124 0001035449-04-000566.hdr.sgml : 20041124 20041124162557 ACCESSION NUMBER: 0001035449-04-000566 CONFORMED SUBMISSION TYPE: 485BPOS PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20041124 DATE AS OF CHANGE: 20041124 EFFECTIVENESS DATE: 20041201 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERIPRIME FUNDS CENTRAL INDEX KEY: 0001000579 IRS NUMBER: 752616671 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1933 Act SEC FILE NUMBER: 033-96826 FILM NUMBER: 041167565 BUSINESS ADDRESS: STREET 1: 431 NORTH PENNSYLVANIA STREET 2: STREET CITY: INDIANAPOLIS STATE: IN ZIP: 46204 BUSINESS PHONE: 317-917-7000 MAIL ADDRESS: STREET 1: 431 NORTH PENNSYLVANIA STREET 2: STREET CITY: INDIANAPOLIS STATE: IN ZIP: 46204 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERIPRIME FUNDS CENTRAL INDEX KEY: 0001000579 IRS NUMBER: 752616671 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-09096 FILM NUMBER: 041167566 BUSINESS ADDRESS: STREET 1: 431 NORTH PENNSYLVANIA STREET 2: STREET CITY: INDIANAPOLIS STATE: IN ZIP: 46204 BUSINESS PHONE: 317-917-7000 MAIL ADDRESS: STREET 1: 431 NORTH PENNSYLVANIA STREET 2: STREET CITY: INDIANAPOLIS STATE: IN ZIP: 46204 485BPOS 1 pe83.txt DOBSON FORM N-1A SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / / Pre-Effective Amendment No.: / / Post-Effective Amendment No.: 83 /X/ and/or REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / / Amendment No.: 84 /X/ (Check appropriate box or boxes.) AmeriPrime Funds - File Nos. 33-96826 and 811-9096 -------------------------------------------------- (Exact Name of Registrant as Specified in Charter) 431 North Pennsylvania Street, Indianapolis, Indiana 46204 ---------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, including Area Code: (317) 917-7000 -------------- Anthony J. Ghoston, AmeriPrime Funds, 431 North Pennsylvania Street, -------------------------------------------------------------------- Indianapolis, IN 46204 ---------------------- (Name and Address of Agent for Service) With copy to: Donald S. Mendelsohn, Thompson Hine LLP, 312 Walnut Street, Suite 1400, Cincinnati, Ohio 45202 Approximate Date of Proposed Public Offering: It is proposed that this filing will become effective: /__/ immediately upon filing pursuant to paragraph (b) / X/ on December 1, 2004 pursuant to paragraph (b) /__/ 60 days after filing pursuant to paragraph (a)(1) / / on (date) pursuant to paragraph (a)(1) / / 75 days after filing pursuant to paragraph (a)(2) / / on (date) pursuant to paragraph (a)(2) of Rule 485 If appropriate, check the following box: / / this post-effective amendment designates a new effective date for a previously filed post-effective amendment. DOBSON COVERED CALL FUND PROSPECTUS December 1, 2004 INVESTMENT OBJECTIVE: Total return over the long term. 1422 S. Van Ness Street Santa Ana, California 92707 877-2-DOBSON (877-236-2766) www.dobsoncapital.com The Securities and Exchange Commission has not approved or disapproved these securities or determined if this Prospectus is truthful or complete. Any representation to the contrary is a criminal offense. TABLE OF CONTENTS PAGE RISK/RETURN SUMMARY.........................................................3 FEES AND EXPENSES OF INVESTING IN THE FUND..................................6 HOW TO BUY SHARES...........................................................7 HOW TO REDEEM SHARES........................................................9 DETERMINATION OF NET ASSET VALUE...........................................11 DIVIDENDS, DISTRIBUTIONS AND TAXES.........................................11 MANAGEMENT OF THE FUND.....................................................12 FINANCIAL HIGHLIGHTS.......................................................13 PRIVACY POLICY.............................................................14 FOR MORE INFORMATION...............................................Back Cover 2 RISK/RETURN SUMMARY INVESTMENT OBJECTIVE The investment objective of the Dobson Covered Call Fund is total return over the long term. PRINCIPAL STRATEGIES The Fund invests primarily in dividend paying common stocks of U.S. issuers represented in the S&P 500 Stock Index, maintaining industry weightings similar to those of the Index. The principal strategy of the Fund's advisor is to create a broadly diversified portfolio of common stock, and to reduce the volatility of the Fund's portfolio by selling covered call options. In seeking to achieve total return, the advisor anticipates that income will be derived from dividends on the common stock in the Fund's portfolio and premiums from selling covered call options, and that capital appreciation will be derived from appreciation of the Fund's common stock portfolio, if any. The Fund's option strategy is commonly referred to as "hedging." The Fund has no maximum or minimum level that will be hedged, but anticipates being fully hedged with the exception of the utility industry, for which option premiums have historically been low. Under normal circumstances, at least 80% of the Fund's portfolio will be hedged using covered call options. When selecting the appropriate option for a stock in the portfolio, the advisor bases its decision on the current dividend for the stock, the historical volatility of the stock and the current option premium. The advisor will engage in active trading of the Fund's portfolio securities as a result of its option strategy. When the Fund sells a covered call option, the purchaser of the option has the right to buy that stock at a predetermined price (exercise price) during the life of the option. If the purchaser exercises the option, the Fund must sell the stock to the purchaser at the exercise price. The option is "covered" because the Fund owns the stock at the time it sells the option. As the seller of the option, the Fund receives a premium from the purchaser of the call option, which may provide additional income to the Fund. The selling of covered call options may tend to reduce volatility of the Fund because the premiums received from selling the options will reduce any losses on the underlying securities, but only by the amount of the premiums. However, selling the options will also limit the Fund's gain, if any, on the underlying securities. The advisor believes that in a flat or falling market, a covered call strategy on a broadly diversified portfolio will generally outperform the same portfolio without the options because of the premiums received from writing call options. The advisor believes that in a modestly rising market (where the income from premiums exceeds the aggregate appreciation of the underlying securities over their exercise prices) such a portfolio will also generally outperform the same portfolio without the options. In a rapidly rising market (where the aggregate appreciation of the underlying securities over their exercise prices exceeds the income from premiums), a covered call strategy on a broadly diversified portfolio will underperform the same portfolio without the 3 options. To the extent the Fund receives premiums from expired options and profits from closing purchase transactions, any return from dividends and appreciation will be enhanced. PRINCIPAL RISKS OF INVESTING IN THE FUND o OPTION WRITING RISK. When the Fund sells covered call options, it receives cash but limits its opportunity to profit from an increase in the market value of the stock beyond the exercise price (plus the premium received). In a rapidly rising market, the Fund could significantly underperform the market. The gain on the underlying stock will be equal to the difference between the exercise price and the original purchase price of the underlying security, plus the premium received. The gain may be less than if the Fund had not sold an option on the underlying security. If a call expires unexercised, the Fund realizes a gain in the amount of the premium received, although there may have been a decline (unrealized loss) in the market value of the underlying securities during the option period which may exceed such gain. If the underlying securities should decline by more than the option premium the Fund received, there will be a loss on the overall position. o MANAGEMENT RISK. The advisor's strategy may fail to produce the intended results. o COMPANY RISK. The value of the Fund may decrease in response to the activities and financial prospects of an individual company in the Fund's portfolio. o MARKET RISK. Overall stock market risks may also affect the value of the Fund. Factors such as domestic economic growth and market conditions, interest rate levels and political events affect the securities markets. o VOLATILITY RISK. Common stocks tend to be more volatile than other investment choices and the Fund's hedging strategy cannot eliminate stock volatility. The value of an individual company can be more volatile than the market as a whole. This volatility affects the value of the Fund's shares. The Fund's option strategy cannot prevent losses on the stocks in the portfolio. o The Fund is not a complete investment program. o As with any mutual fund investment, the Fund's returns will vary and you could lose money. o An investment in the Fund is not a deposit of any bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. ADDITIONAL INFORMATION ABOUT THE FUND o The investment objective of the Fund may be changed without shareholder approval. You will be notified 60 days in advance if the Fund's policy to hedge at least 80% of its portfolio is changed. o The premium the Fund receives for writing an option will reflect, among other things, the current market price of the underlying security, the relationship of the exercise price to such market price, the historical price volatility of the underlying security, the option period, supply and demand and interest rates. The exercise price of an option may be below, equal to or above the current market value of the underlying security at the time the option is written. Options written by the Fund will normally have expiration dates between one and nine months from the date written. From time to time, for tax and other reasons, the Fund may purchase an underlying security for delivery in accordance with an exercise notice assigned to it, rather than delivering such security from its portfolio. 4 o From time to time, the Fund may take temporary defensive positions that are inconsistent with the Fund's principal investment strategies in attempting to respond to adverse market, economic, political or other conditions. For example, the Fund may hold all or a portion of its assets in money market instruments, securities of other no-load mutual funds or repurchase agreements. If the Fund invests in shares of another mutual fund, the shareholders of the Fund will indirectly pay additional management fees. As a result of engaging in these temporary measures, the Fund may not achieve its investment objective. The Fund may also invest in such instruments at any time to maintain liquidity or pending selection of investments in accordance with its policies. HOW THE FUND HAS PERFORMED The bar chart and performance table below show the variability of the Fund's returns, which is one indicator of the risks of investing in the Fund. The bar chart shows changes in the return of the Fund from year to year. The performance table shows how the Fund's average annual total returns compare over time to a broad-based securities market index. Of course, the Fund's past performance (before and after taxes) is not necessarily an indication of its future performance. TOTAL RETURN AS OF DECEMBER 31 [CHART OMITTED] 2000 - 0.40%, 2001 - (3.08%), 2002 - (14.53%), 2003 - 14.69% During the period shown, the highest return for a quarter was 10.30% (4th quarter, 2001); and the lowest return was -14.97% (3rd quarter, 2002). *The Fund's year-to-date return as of September 30, 2004 was 0.95%. 5 AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIODS ENDED 12/31/2003: Since One Year Inception(1) -------- ------------ THE FUND Return Before Taxes 14.69% 1.21% Return After Taxes on Distributions(2) 14.69% -1.34% Return After Taxes on Distributions and Sale of Fund Shares(2) 8.94% -0.07% S&P 500 STOCK INDEX 28.66% -1.23% (reflects no deduction for fees, expenses, or taxes) (1)March 24, 1999. (2) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor's tax situation and may differ from those shown. After-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts. FEES AND EXPENSES OF INVESTING IN THE FUND The tables describe the fees and expenses that you may pay if you buy and hold shares of the Fund. SHAREHOLDER FEES (fees paid directly from your investment) Maximum Sales Charge (Load) Imposed on Purchases .........................NONE Maximum Deferred Sales Charge (Load)......................................NONE Maximum Sales Charge (Load) Imposed on Reinvested Dividends and other Distributions................................................NONE Redemption Fees1..........................................................NONE ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund assets) Management Fees2..........................................................0.00% Distribution (12b-1) Fees3................................................0.00% Other Expenses............................................................1.98% Total Annual Fund Operating Expenses......................................1.98% Expense Reimbursement4....................................................0.48% Net Expenses..............................................................1.50% 1A wire transfer fee of $15 is charged to defray custodial charges for redemptions paid by wire transfer. This fee is subject to change. 2As compensation for its management services, the Fund is obligated to pay the advisor a fee computed and accrued daily and paid monthly at an annual rate of 0.80% of the average daily net assets of the Fund, less the amount by which total operating expenses, including the management fee, exceed 1.50%. 3The Fund currently is not assessing a 12b-1 fee, but may do so in the future. 4The advisor has contractually agreed to reimburse the Fund for the operating expenses it incurs, but only to the extent necessary to maintain the Fund's total annual operating expenses (excluding brokerage costs, borrowing costs, taxes and extraordinary expenses) at 1.50% of its average daily net assets. 6 Example: - -------- This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated, reinvest dividends and distributions, and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be: 1 year 3 years 5 years 10 years ------ ------- ------- -------- $153 $474 $818 $1,791 HOW TO BUY SHARES To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. What this means for you: When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask for other identifying documents or information. The minimum initial investment in the Fund is $2,500 and there is no minimum on subsequent investments. There is no minimum on initial or subsequent investments by tax deferred retirement plans (including IRA, SEP-IRA, Profit Sharing and Money Purchase Plans) or uniform gifts to minor accounts. These minimums may be waived by the advisor for accounts participating in an automatic investment program. If your investment is aggregated into an omnibus account established by an investment advisor, broker or other intermediary, the account minimums apply to the omnibus account, not to your individual investment. If you purchase or redeem shares through a broker-dealer or another intermediary, you may be charged a fee by that intermediary. INITIAL PURCHASE BY MAIL - To be in proper form, your initial purchase request must include: o a completed and signed investment application form (which accompanies this Prospectus); o the initial check should have the same address as the application; and o a check (subject to the minimum amounts) made payable to the Fund. U.S. MAIL: OVERNIGHT: Dobson Covered Call Fund Dobson Covered Call Fund c/o Unified Fund Services, Inc. c/o Unified Fund Services, Inc. P.O. Box 6110 431 North Pennsylvania Street Indianapolis, Indiana 46206-6110 Indianapolis, Indiana 46204 7 BY WIRE - You may also purchase shares of the Fund by wiring federal funds from your bank, which may charge you a fee for doing so. To wire money, you must call Unified Fund Services, Inc., the Fund's transfer agent, at 877-2-DOBSON to obtain instructions on how to set up your account and to obtain an account number. Then, provide your bank with the following information for purposes of wiring your investment: UMB Bank, N.A. ABA #101000695 Attn: Dobson Covered Call Fund D.D.A. # 9870983672 Account Name _________________(write in shareholder name) For the Account # ______________ (write in account number) You must provide a signed application to Unified Fund Services, Inc. at the above address in order to complete your initial wire purchase. Wire orders will be accepted only on a day on which the Fund, custodian and transfer agent are open for business. A wire purchase will not be considered made until the wired money is received and the purchase is accepted by the Fund. Any delays which may occur in wiring money, including delays which may occur in processing by the banks, are not the responsibility of the Fund or the transfer agent. There is presently no fee for the receipt of wired funds, but the Fund may charge shareholders for this service in the future. ADDITIONAL INVESTMENTS You may purchase additional shares of the Fund at any time by mail, wire or automatic investment. Each additional mail purchase request must contain: -your name -the name of your account(s) -your account number(s) -a check made payable to the Dobson Covered Call Fund Checks should be sent to the Dobson Covered Call Fund at the address listed above. A bank wire should be sent as outlined above. AUTOMATIC INVESTMENT PLAN You may make regular investments in the Fund with an Automatic Investment Plan by completing the appropriate section of the account application and attaching a voided personal check. Investments may be made monthly to allow dollar-cost averaging by automatically deducting $100 or more from your bank checking account. You may change the amount of your monthly purchase at any time. If an Automatic Investment Plan purchase is rejected by your bank, your shareholder account will be charged a fee to defray bank charges. TAX SHELTERED RETIREMENT PLANS Since the Fund is oriented to longer term investors, the Fund may be an appropriate investment for tax-sheltered retirement plans, including: individual retirement plans ("IRAs"); simplified employee pensions ("SEPs"); SIMPLE Plans; 401(k) plans; qualified corporate pension 8 and profit-sharing plans (for employees); tax deferred investment plans (for employees of public school systems and certain types of charitable organizations); and other qualified retirement plans. You should contact the transfer agent for the procedure to open an IRA or SEP plan, as well as more specific information regarding these retirement plan options. Please consult with an attorney or tax advisor regarding these plans. You must pay custodial fees for your IRA by redemption of sufficient shares of the Fund from the IRA unless you pay the fees directly to the IRA custodian. Call the transfer agent about the IRA custodial fees. OTHER PURCHASE INFORMATION You may exchange securities that you own for shares of the Fund, provided the securities meet the Fund's investment criteria and the advisor deems them to be a desirable investment for the Fund. Any exchange will be a taxable event and you may incur certain transaction costs relating to the exchange. You may contact the transfer agent at 877-2-DOBSON for more information. Please consult your tax advisor for information about the tax effects of such an exchange. The Fund may limit the amount of purchases and to refuse to sell to any person. If your check or wire does not clear, you will be responsible for any loss incurred by the Fund. If you are already a shareholder, the Fund can redeem shares from any identically registered account in the Fund as reimbursement for any loss incurred. You may be prohibited or restricted from making future purchases in the Fund. DISTRIBUTION PLAN The Fund has adopted a plan pursuant to Rule 12b-1 under the Investment Company Act of 1940 (the "Plan"), which permits the Fund to pay directly, or reimburse the advisor and distributor, for certain distribution and promotion expenses related to marketing its shares, in an amount not to exceed 0.25% of the average daily net assets of the Fund. The Fund is not currently incurring expenses under the Plan. Expenditures pursuant to the Plan and related agreements may reduce current yield after expenses. Because these fees are paid out of the Fund's assets on an on-going basis, over time these fees would increase the cost of your investment and may cost you more than paying other types of sales charges. HOW TO REDEEM SHARES You may receive redemption payments by check or federal wire transfer. The proceeds may be more or less than the purchase price of your shares, depending on the market value of the Fund's securities at the time of your redemption. A wire transfer fee of $15 is charged to defray custodial charges for redemptions paid by wire transfer. This fee is subject to change. Any charges for wire redemptions will be deducted from your Fund account by redemption of shares. If you redeem your shares through a broker-dealer or other institution, you may be charged a fee by that institution. BY MAIL - You may redeem any part of your account in the Fund at no charge by mail. Your request should be addressed as follows: 9 U.S. MAIL: OVERNIGHT: Dobson Covered Call Fund Dobson Covered Call Fund c/o Unified Fund Services, Inc. c/o Unified Fund Services, Inc. P.O. Box 6110 431 North Pennsylvania Street Indianapolis, Indiana 46206-6110 Indianapolis, Indiana 46204 Your request for a redemption must include your letter of instruction, including the Fund name, account number, account name(s), the address, and the dollar amount or number of shares you wish to redeem. Requests to sell shares that are received in good order are processed at the net asset value next calculated after we receive your order in proper form. To be in proper form, your request for a redemption must be signed by all registered share owner(s) in the exact name(s) and any special capacity in which they are registered. The Fund may require that signatures be guaranteed if you request the redemption check be made payable to any person other than the shareholder(s) of record or mailed to an address other than the address of record, or if the mailing address has been changed within 30 days of the redemption request. The Fund may also require that signatures be guaranteed for redemptions of $25,000 or more. Signature guarantees are for the protection of shareholders. You can obtain a signature guarantee from most banks and securities dealers, but not from a notary public. For joint accounts, both signatures must be guaranteed. Please call the transfer agent at 877-2-DOBSON if you have questions. At the discretion of the Fund or the Fund's transfer agent (Unified Fund Services, Inc.), a shareholder, prior to redemption, may be required to furnish additional legal documents to insure proper authorization. BY TELEPHONE - You may redeem any part of your account in the Fund by calling the transfer agent at 877-2-DOBSON. You must first complete the Optional Telephone Redemption and Exchange section of the investment application to institute this option. The Fund, the transfer agent and the custodian are not liable for following redemption or exchange instructions communicated by telephone to the extent that they reasonably believe the telephone instructions to be genuine. However, if they do not employ reasonable procedures to confirm that telephone instructions are genuine, they may be liable for any losses due to unauthorized or fraudulent instructions. Procedures employed may include recording telephone instructions and requiring a form of personal identification from the caller. The Fund or the transfer agent may terminate the telephone redemption procedures at any time. During periods of extreme market activity, it is possible that shareholders may encounter some difficulty in telephoning the Fund, although neither the Fund nor the transfer agent has ever experienced difficulties in receiving and in a timely fashion responding to telephone requests for redemptions or exchanges. If you are unable to reach the Fund by telephone, you may request a redemption or exchange by mail. ADDITIONAL INFORMATION - If you are not certain of the requirements for a redemption please call the transfer agent at 877-2-DOBSON. Redemptions specifying a certain date or share price cannot be accepted and will be returned. You will be mailed the proceeds on or before the fifth business day following the redemption. You may be assessed a fee if the Fund incurs bank charges because you request that the Fund re-issue a redemption check. However, payment for redemption made against shares purchased by check will be made only after the check has been collected, which normally may take up to fifteen calendar days. Also, when the New York Stock Exchange is 10 closed (or when trading is restricted) for any reason other than its customary weekend or holiday closing, or under any emergency circumstances (as determined by the Securities and Exchange Commission) the Fund may suspend redemptions or postpone payment dates. Because the Fund incurs certain fixed costs in maintaining shareholder accounts, the Fund may require you to redeem all of your shares in the Fund on 30 days' written notice if the value of your shares in the Fund is less than $2,500 due to redemption, or such other minimum amount as the Fund may determine from time to time. You may increase the value of your shares in the Fund to the minimum amount within the 30 day period. All shares of the Fund are also subject to involuntary redemption if the Board of Trustees determines to liquidate the Fund. An involuntary redemption will create a capital gain or a capital loss, which may have tax consequences about which you should consult your tax advisor. DETERMINATION OF NET ASSET VALUE The price you pay for your shares is based on the Fund's net asset value per share ("NAV"). The NAV is calculated at the close of trading (normally 4:00 p.m. Eastern time) on each day the New York Stock Exchange is open for business (the Stock Exchange is closed on weekends, most Federal holidays and Good Friday). The NAV is calculated by dividing the value of the Fund's total assets (including interest and dividends accrued but not yet received) minus liabilities (including accrued expenses) by the total number of shares outstanding. The Fund's assets are generally valued at their market value. If market prices are not available, or if an event occurs after the close of the trading market that materially affects the values, assets may be valued by the advisor at their fair value, according to procedures approved by the Board of Trustees. Requests to purchase and sell shares are processed at the NAV next calculated after we receive your order in proper form. DIVIDENDS, DISTRIBUTIONS AND TAXES DIVIDENDS AND DISTRIBUTIONS. The Fund typically distributes substantially all of its net investment income in the form of dividends and taxable capital gains to its shareholders on an annual basis. These distributions are automatically reinvested in the Fund unless you request cash distributions on your application or through a written request. The Fund expects that its distributions will consist primarily of short term capital gains from the sale of options. TAXES. In general, selling shares of the Fund and receiving distributions (whether reinvested or taken in cash) are taxable events. Depending on the purchase price and the sale price, you may have a gain or a loss on any shares sold. Any tax liabilities generated by your transactions or by receiving distributions are your responsibility. Because distributions of long term capital gains are subject to capital gains taxes, regardless of how long you have owned your shares, you may want to avoid making a substantial investment when the Fund is about to make a taxable distribution because you would be responsible for any taxes on the distribution regardless of how long you have owned your shares. 11 If the Fund has to sell a security because of the exercise of a call option, the Fund will realize a gain or loss from the sale of the underlying security with the proceeds being increased by the amount of the option premium received. By permitting its underlying securities to be called away or exercised, higher portfolio turnover (and increased transaction costs) will result. Portfolio turnover also results in capital gains for income tax purposes. The Fund will attempt to minimize portfolio turnover by entering into closing purchase transactions that it deems appropriate to achieve the Fund's objectives. A high portfolio turnover rate can result in higher current realization of capital gains and a potentially larger current tax liability. Early each year, the Fund will mail to you a statement setting forth the federal income tax information for all distributions made during the previous year. If you do not provide your taxpayer identification number, your account will be subject to backup withholding. The tax considerations described in this section do not apply to tax-deferred accounts or other non-taxable entities. Because each investor's tax circumstances are unique, please consult with your tax advisor about your investment. MANAGEMENT OF THE FUND Dobson Capital Management, Inc., 1422 S. Van Ness Street, Santa Ana, California serves as investment advisor to the Fund. The advisor determines the securities to be held or sold by the Fund, and the portion of the Fund's assets to be held uninvested. Dobson Capital Management, Inc. is a California corporation established in 1998. Charles L. Dobson is the President, Director and sole shareholder of the advisor, and is primarily responsible for the day-to-day management of the Fund's portfolio. Mr. Dobson was associated with Analytic/TSA Global Asset Management for nearly twenty years, acting as Executive Vice President and Portfolio Manager of the Analytic Optioned Equity Fund from March 1992 until May 1998, and Executive Vice President and Secretary of the Analytic Series Fund from November 1992 until May 1998. Mr. Dobson graduated from the University of California at Irvine where he received a BA in Economics and an MS in Administration. For the fiscal year ended July 31, 2004, the advisor received no compensation from the Fund. As compensation for its management services, the Fund is obligated to pay the advisor a fee computed and accrued daily and paid monthly at an annual rate of 0.80% of the average daily net assets of the Fund, less the amount by which total operating expenses, including the management fee, exceed 1.50%. The advisor may pay certain financial institutions (which may include banks, brokers, securities dealers and other industry professionals) a fee for providing distribution related services and/or for performing certain administrative servicing functions for Fund shareholders to the extent these institutions are allowed to do so by applicable statute, rule or regulation. The Fund may from time to time purchase securities issued by financial institutions that provide such services; however, in selecting investments for the Fund, no preference will be show for such securities. 12 FINANCIAL HIGHLIGHTS The following table is intended to help you better understand the Fund's financial performance since its inception. Certain information reflects financial results for a single Fund share. Total return represents the rate you would have earned (or lost) on an investment in the Fund, assuming reinvestment of all dividends and distributions. The information for the fiscal year ended July 31, 2004 has been audited by Cohen McCurdy, Ltd., whose report, along with the Fund's financial statements, are included in the Fund's annual report, which is available upon request. The information for prior years has been audited by another independent public accounting firm. Year ended Year ended Year ended Year ended Year ended July 31, 2004 July 31, 2003 July 31, 2002 July 31, 2001 July 31, 2000 ----------------- ----------------- ---------------- ---------------- ------------------ Selected Per Share Data Net asset value, beginning of period $ 6.85 $ 6.88 $ 9.34 $ 10.67 $ 10.78 ----------------- ----------------- ---------------- ---------------- ------------------ Income from investment operations Net investment income 0.02 0.03 0.02 0.04 0.03 Net realized and unrealized gain (loss) 0.50 0.42 (1.36) (0.22) 0.35 ----------------- ----------------- ---------------- ---------------- ------------------ Total from investment 0.52 0.45 (1.34) (0.18) 0.38 operations ----------------- ----------------- ---------------- ---------------- ------------------ Less Distributions to shareholders: From net investment income - (0.02) (0.03) (0.18) (0.01) From net realized gain - (0.46) (1.09) (0.97) (0.48) ----------------- ----------------- ---------------- ---------------- ------------------ Total distributions - (0.48) (1.12) (1.15) (0.49) ----------------- ----------------- ---------------- ---------------- ------------------ ----------------- ----------------- ---------------- ---------------- ------------------ Net asset value, end of period $ 7.37 $ 6.85 $ 6.88 $ 9.34 $ 10.67 Total Return (a) 7.59% 6.91% -15.82% -1.64% 3.59% Ratios and Supplemental Data Net assets, end of period (000) $ 6,258 $ 4,798 $ 1,392 $ 1,652 $ 1,540 Ratio of expenses to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% Ratio of expenses to average net assets before waiver & reimbursement 1.98% 4.83% 5.51% 5.19% 5.47% Ratio of net investment income to average net assets 0.34% 0.48% 0.26% 0.44% 0.31% Ratio of net investment income to average net assets before waiver & reimbursement (0.14)% (2.85)% (3.75)% (3.25)% (3.66)% Portfolio turnover rate 10.25% 0.47% 6.51% 6.62% 31.75%
(a) Total return in the above table represents the rate that investor would have earned or lost on an investment in the Fund, assuming reinvestment of dividends. PRIVACY POLICY The following is a description of the Fund's policies regarding disclosure of nonpublic personal information that you provide to the Fund or that the Fund collects from other sources. In the event that you hold shares of the Fund through a broker-dealer or other financial intermediary, the privacy policy of your financial intermediary would govern how your nonpublic personal information would be shared with nonaffiliated third parties. CATEGORIES OF INFORMATION THE FUND COLLECTS. The Fund collects the following nonpublic personal information about you: o Information the Fund receives from you on or in applications or other forms, correspondence, or conversations (such as your name, address, phone number, social security number, assets, income and date of birth); and o Information about your transactions with the Fund, its affiliates, or others (such as your account number and balance, payment history, parties to transactions, cost basis information, and other financial information). CATEGORIES OF INFORMATION THE FUND DISCLOSES. The Fund does not disclose any nonpublic personal information about its current or former shareholders to unaffiliated third parties, except as required or permitted by law. The Fund is permitted by law to disclose all of the information it collects, as described above, to its service providers (such as the Fund's custodian, administrator and transfer agent) to process your transactions and otherwise provide services to you. CONFIDENTIALITY AND SECURITY. The Fund restricts access to your nonpublic personal information to those persons who require such information to provide products or services to you. The Fund maintains physical, electronic, and procedural safeguards that comply with federal standards to guard your nonpublic personal information. 14 FOR MORE INFORMATION Several additional sources of information are available to you. The Statement of Additional Information ("SAI"), incorporated into this Prospectus by reference, contains detailed information on Fund policies and operations. Annual and semi-annual reports contain management's discussion of market conditions and investment strategies that significantly affected the Fund's performance results as of the Fund's latest semi-annual or annual fiscal year end. Call the Fund at 877-2-DOBSON to request free copies of the SAI and the Fund's annual and semi-annual reports, to request other information about the Fund and to make shareholder inquiries. You may review and copy information about the Fund (including the SAI and other reports) at the Securities and Exchange Commission ("SEC") Public Reference Room in Washington, D.C. Call the SEC at 1-202-942-8090 for room hours and operation. You may also obtain reports and other information about the Fund on the EDGAR Database on the SEC's Internet site at http.//www.sec.gov, and copies of this information may be obtained, after paying a duplicating fee, by electronic request at the following e-mail address: publicinfo@sec.gov or by writing the SEC's Public Reference Section, Washington, D.C. 20549-0102. Investment Company Act #811-9096 15 DOBSON COVERED CALL FUND STATEMENT OF ADDITIONAL INFORMATION December 1, 2004 This Statement of Additional Information ("SAI") is not a prospectus. It should be read in conjunction with the Prospectus of the Dobson Covered Call Fund dated December 1, 2004. This SAI incorporates by reference the Fund's annual report to shareholders for the fiscal year ended July 31, 2004. A free copy of the Prospectus or annual report can be obtained by writing the transfer agent at 431 North Pennsylvania Street, Indianapolis, Indiana 46204 or by calling 1-877-236-2766. PAGE DESCRIPTION OF THE TRUST AND THE FUND........................................3 ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK CONSIDERATIONS............................................................4 INVESTMENT LIMITATIONS.......................................................6 THE INVESTMENT ADVISOR.......................................................9 DISTRIBUTION PLAN...........................................................10 TRUSTEES AND OFFICERS.......................................................11 PORTFOLIO TRANSACTIONS AND BROKERAGE........................................14 DETERMINATION OF SHARE PRICE................................................15 ADDITIONAL TAX INFORMATION..................................................16 CUSTODIAN...................................................................18 FUND SERVICES...............................................................19 ACCOUNTANTS.................................................................19 DISTRIBUTOR.................................................................19 PROXY VOTING POLICIES.......................................................20 FINANCIAL STATEMENTS........................................................21 DESCRIPTION OF THE TRUST AND FUND The Dobson Covered Call Fund (the "Fund") was organized as a diversified series of AmeriPrime Funds (the "Trust") on March 22, 1999 and commenced operations on March 24, 1999. The Trust is an open-end investment company established under the laws of Ohio by an Agreement and Declaration of Trust dated August 8, 1995 (the "Trust Agreement"). The Trust Agreement permits the Trustees to issue an unlimited number of shares of beneficial interest of separate series without par value. The Fund is one of a series of funds currently authorized by the Trustees. The investment advisor to the Fund is Dobson Capital Management, Inc. (the "Advisor"). The Fund does not issue share certificates. All shares are held in non-certificate form registered on the books of the Fund and the transfer agent for the account of the shareholder. Each share of a series represents an equal proportionate interest in the assets and liabilities belonging to that series with each other share of that series and is entitled to such dividends and distributions out of income belonging to the series as are declared by the Trustees. The shares do not have cumulative voting rights or any preemptive or conversion rights, and the Trustees have the authority from time to time to divide or combine the shares of any series into a greater or lesser number of shares of that series so long as the proportionate beneficial interest in the assets belonging to that series and the rights of shares of any other series are in no way affected. In case of any liquidation of a series, the holders of shares of the series being liquidated will be entitled to receive as a class a distribution out of the assets, net of the liabilities, belonging to that series. Expenses attributable to any series are borne by that series. Any general expenses of the Trust not readily identifiable as belonging to a particular series are allocated by or under the direction of the Trustees in such manner as the Trustees determine to be fair and equitable. No shareholder is liable to further calls or to assessment by the Trust without his or her express consent. As of October 31, 2004, the following persons may be deemed to have beneficially owned five percent (5%) or more of the Fund: Charles L. Dobson, 1422 S. Van Ness, Santa Ana, California 92707 - 16.85%. As of October 31, 2004, Pershing LLC, P.O. Box 2052, Jersey City, New Jersey 07303, for the benefit of others owned or held of record 69.51% of the Fund. Pershing LLC may be deemed to control the Fund and could control the outcome of any proposal submitted to the shareholders for approval, including changes to the Fund's fundamental policies or the terms of the management agreement with the Advisor. As of October 31, 2004, the Trustees and officers as a group beneficially owned less than one percent (1%) of the Fund. Any Trustee of the Trust may be removed by vote of the shareholders holding not less than two-thirds of the outstanding shares of the Trust. The Trust does not hold an annual meeting of shareholders. When matters are submitted to shareholders for a vote, each shareholder is entitled to one vote for each whole share he owns and fractional votes for fractional shares he owns. All shares of the Fund have equal voting rights and liquidation rights. The Agreement and Declaration of Trust can be amended by the Trustees, except that any amendment that adversely 3 effects the rights of shareholders must be approved by the shareholders affected. All shares of the Fund are subject to involuntary redemption if the Trustees determine to liquidate the Fund. An involuntary redemption will create a capital gain or a capital loss, which may have tax consequences about which you should consult your tax advisor. For information concerning the purchase and redemption of shares of the Fund, see "How to Buy Shares" and "How to Redeem Shares" in the Prospectus. For a description of the methods used to determine the share price and value of the Fund's assets, see "Determination of Net Asset Value" in the Prospectus and "Determination of Share Price" in this Statement of Additional Information. ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK CONSIDERATIONS This section contains a more detailed discussion of some of the investments the Fund may make and some of the techniques it may use, as described in the Prospectus (see "Risk/Return Summary"). A. Equity Securities. Equity securities consist of common stock, ------------------- convertible preferred stock, rights and warrants. Common stocks, the most familiar type, represent an equity (ownership) interest in a corporation. Warrants are options to purchase equity securities at a specified price for a specific time period. Rights are similar to warrants, but normally have a short duration and are distributed by the issuer to its shareholders. Although equity securities have a history of long term growth in value, their prices fluctuate based on changes in a company's financial condition and on overall market and economic conditions. Investments in equity securities are subject to inherent market risks and fluctuations in value due to earnings, economic conditions and other factors beyond the control of the Advisor. As a result, the return and net asset value of a Fund will fluctuate. Securities in a Fund's portfolio may not increase as much as the market as a whole and some undervalued securities may continue to be undervalued for long periods of time. Although profits in some Fund holdings may be realized quickly, it is not expected that most investments will appreciate rapidly. B. Options Transactions. The Fund may write (sell) covered call options. A -------------------- covered call option on a security is an agreement to sell a particular security in the Fund's portfolio if the option is exercised at a specified price, or before a set date. The Fund may also sell exchange listed stock index call options to hedge against risks of market wide price movements. Options are sold (written) on securities and market indices. The purchaser of an option on a security pays the seller (the writer) a premium for the right granted but is not obligated to buy or sell the underlying security. The purchaser of an option on a market index pays the seller a premium for the right granted, and in return the seller of such an option is obligated to make the payment. A writer of an option may terminate the obligation prior to the expiration of the option by making an offsetting purchase of an identical option. Options on securities which the Fund sells (writes) will be covered or secured, which means that it will own the underlying security (for a call option) or (for an option on a stock index) will hold a portfolio of securities substantially replicating the movement of the index (or, to the extent it does not hold such a 4 portfolio, will maintain a segregated account with the Fund's custodian of high quality liquid debt obligations equal to the market value of the option, marked to market daily). When the Fund writes options, it may be required to maintain a margin account, to pledge the underlying security or to deposit liquid high quality debt obligations in a separate account with the custodian. When a Fund writes an option, the Fund profits from the sale of the option, but gives up the opportunity to profit from any increase in the price of the stock above the option price, and may incur a loss if the stock price falls. Risks associated with writing covered call options include the possible inability to effect closing transactions at favorable prices and an appreciation limit on the securities set aside for settlement. When the Fund writes a covered call option, it will receive a premium, but will assume the risk of loss should the price of the underlying security fall below the exercise price. A call option gives the purchaser of the option the right to buy, and the writer of the option has the obligation to sell, the underlying securities at the exercise price during the option period. The Fund, as the writer of the option, receives a premium from the purchaser of the call option. During the time the Fund is obligated under the option, the Fund may be assigned an exercise notice by the broker-dealer through whom the call was sold, requiring the Fund to deliver the underlying security against payment of the exercise price. The obligation is terminated only upon expiration of the option or at such earlier time as the Fund purchases the option back (closing purchase transaction). Once the Fund has been assigned an exercise notice, it will be unable to enter into a closing purchase transaction. So long as the Fund is obligated as the writer of a call option, it will own the underlying securities subject to the option. To secure this obligation to deliver the underlying security, the Fund is required to deposit in escrow the underlying securities or other assets in accordance with the rules of the clearing corporation and the exchange on which the call option is traded. To fulfill this obligation at the time an option is written, the Fund, in compliance with its custodian agreement, directs the custodian of its investment securities, or a securities depository acting for the custodian, to act as the Fund's escrow agent by issuing an escrow receipt to the clearing corporation respecting the option's underlying securities. The clearing corporation will release the securities from this escrow either upon the exercise of the option, the expiration of the option without being exercised or when the Fund enters into a closing purchase transaction. Until such release the Fund cannot sell the underlying securities. The Fund will write options on such portion of its portfolio as management determines is appropriate in seeking to attain the Fund's objective. The Fund will write options when management believes that a liquid secondary market will exist on a national securities exchange for options of the same series so that the Fund can effect a closing purchase transaction if it desires to close out its position. Consistent with the investment policies of the Fund, a closing purchase transaction will ordinarily be effected to realize a profit on an outstanding option, to prevent an underlying security from being called or to permit the sale of the underlying security. Effecting a closing purchase transaction will permit the Fund to write another option on the underlying security with either a different exercise price or expiration date or both. C. Stock Index Options. The Fund may sell exchange listed stock index call ------------------- options to hedge against risks of market wide price movements. The need to hedge against such risks will depend on the extent of diversification of the Fund's common stock and the sensitivity of its stock 5 investments to factors influencing the stock market as a whole. A stock index fluctuates with changes in the market values of the securities included in the index. Options on securities indices are generally similar to options on stocks except that the delivery requirements are different. Instead of giving the right to take or make delivery of securities at a specified price, an option on a stock index gives the holders the right to receive a cash "exercise settlement amount" equal to (a) the amount, if any, by which the fixed exercise price of the option exceeds (in the case of a put) or is less than (in the case of a call) the closing value of the underlying index on the date of the exercise, multiplied by (b) a fixed "index multiplier." To cover the potential obligations involved in writing stock index options, the Fund will either: (a) hold a portfolio of stocks substantially replicating the movement of the index; or (b) the Fund will segregate with the custodian high grade liquid debt obligations equal to the market value of the stock index option, marked to market daily. The Fund will only write stock index options when in its opinion the underlying stocks will correlate with the index. The Fund's ability to hedge effectively all or a portion of its securities through transactions in stock index options depends on the degree to which price movements in the underlying securities correlate with price movements in the relevant index. Inasmuch as such securities will not duplicate the components of any index, the correlation will not be perfect. Consequently, the Fund bears the risk that the prices of the underlying securities being hedged will not move in the same amount as the stock index. D. Repurchase Agreements. The Fund may invest in repurchase agreements ---------------------- fully collateralized by obligations issued by the U.S. government or by agencies of the U.S. government ("U.S. Government Obligations"). A repurchase agreement is a short term investment in which the purchaser (i.e., the Fund) acquires ownership of a U.S. Government Obligation (which may be of any maturity) and the seller agrees to repurchase the obligation at a future time at a set price, thereby determining the yield during the purchaser's holding period (usually not more than 7 days from the date of purchase). Any repurchase transaction in which the Fund engages will require full collateralization of the seller's obligation during the entire term of the repurchase agreement. In the event of a bankruptcy or other default of the seller, the Fund could experience both delays in liquidating the underlying security and losses in value. However, the Fund intends to enter into repurchase agreements only with UMB Bank, N.A. (the Fund's custodian), other banks with assets of $1 billion or more and registered securities dealers determined by the Advisor to be creditworthy. The Advisor monitors the creditworthiness of the banks and securities dealers with which the Fund engages in repurchase transactions. INVESTMENT LIMITATIONS Fundamental. The investment limitations described below have been adopted ----------- by the Trust with respect to the Fund and are fundamental ("Fundamental"), i.e., they may not be changed without the affirmative vote of a majority of the outstanding shares of the Fund. As used in the Prospectus and the Statement of Additional Information, the term "majority" of the outstanding shares of the Fund means the lesser of: (1) 67% or more of the outstanding shares of the Fund present at a meeting, if the holders of more than 50% of the outstanding shares of the Fund are present or represented at such meeting; or (2) more than 50% of the outstanding shares of the Fund. Other investment practices which may be changed by the Board of Trustees without the 6 approval of shareholders to the extent permitted by applicable law, regulation or regulatory policy are considered non-fundamental ("Non-Fundamental"). 1. Borrowing Money. The Fund will not borrow money, except: (a) from a ---------------- bank, provided that immediately after such borrowing there is an asset coverage of 300% for all borrowings of the Fund; or (b) from a bank or other persons for temporary purposes only, provided that such temporary borrowings are in an amount not exceeding 5% of the Fund's total assets at the time when the borrowing is made. This limitation does not preclude the Fund from entering into reverse repurchase transactions, provided that the Fund has an asset coverage of 300% for all borrowings and repurchase commitments of the Fund pursuant to reverse repurchase transactions. 2. Senior Securities. The Fund will not issue senior securities. This ------------------ limitation is not applicable to activities that may be deemed to involve the issuance or sale of a senior security by the Fund, provided that the Fund's engagement in such activities is consistent with or permitted by the Investment Company Act of 1940, as amended, the rules and regulations promulgated thereunder or interpretations of the Securities and Exchange Commission or its staff. 3. Underwriting. The Fund will not act as underwriter of securities issued ------------ by other persons. This limitation is not applicable to the extent that, in connection with the disposition of portfolio securities (including restricted securities), the Fund may be deemed an underwriter under certain federal securities laws. 4. Real Estate. The Fund will not purchase or sell real estate. This ------------ limitation is not applicable to investments in marketable securities which are secured by or represent interests in real estate. This limitation does not preclude the Fund from investing in mortgage-related securities or investing in companies engaged in the real estate business or that have a significant portion of their assets in real estate (including real estate investment trusts). 5. Commodities. The Fund will not purchase or sell commodities unless ----------- acquired as a result of ownership of securities or other investments. This limitation does not preclude the Fund from purchasing or selling options or futures contracts, from investing in securities or other instruments backed by commodities or from investing in companies which are engaged in a commodities business or have a significant portion of their assets in commodities. 6. Loans. The Fund will not make loans to other persons, except: (a) by ----- loaning portfolio securities; (b) by engaging in repurchase agreements; or (c) by purchasing nonpublicly offered debt securities. For purposes of this limitation, the term "loans" shall not include the purchase of a portion of an issue of publicly distributed bonds, debentures or other securities. 7. Concentration. The Fund will not invest 25% or more of its total assets ------------- in a particular industry. This limitation is not applicable to investments in obligations issued or guaranteed by the U.S. government, its agencies and instrumentalities or repurchase agreements with respect thereto. 8. Diversification. The Fund will not invest in the securities of any --------------- issuer if, immediately after such investment, less than 75% of the total assets of the Fund will be invested in cash and 7 cash items (including receivables), Government securities, securities of other investment companies or other securities for the purposes of this calculation limited in respect of any one issuer to an amount (determined immediately after the latest acquisition of securities of the issuer) not greater in value than 5% of the total assets of the Fund and to not more than 10% of the outstanding voting securities of such issuer. With respect to the percentages adopted by the Trust as maximum limitations on its investment policies and limitations, an excess above the fixed percentage will not be a violation of the policy or limitation unless the excess results immediately and directly from the acquisition of any security or the action taken. This paragraph does not apply to the borrowing policy set forth in paragraph 1 above. Notwithstanding any of the foregoing limitations, any investment company, whether organized as a trust, association or corporation, or a personal holding company, may be merged or consolidated with or acquired by the Trust, provided that if such merger, consolidation or acquisition results in an investment in the securities of any issuer prohibited by said paragraphs, the Trust shall, within ninety days after the consummation of such merger, consolidation or acquisition, dispose of all of the securities of such issuer so acquired or such portion thereof as shall bring the total investment therein within the limitations imposed by said paragraphs above as of the date of consummation. Non-Fundamental. The following limitations have been adopted by the Trust --------------- with respect to the Fund and are Non-Fundamental (see "Investment Limitations - Fundamental" above). 1. Pledging. The Fund will not mortgage, pledge, hypothecate or in any -------- manner transfer, as security for indebtedness, any assets of the Fund except as may be necessary in connection with borrowings described in limitation (1) above. Margin deposits, security interests, liens and collateral arrangements with respect to transactions involving options, futures contracts, short sales and other permitted investments and techniques are not deemed to be a mortgage, pledge or hypothecation of assets for purposes of this limitation. 2. Borrowing. The Fund will not engage in borrowing. --------- 3. Margin Purchases. The Fund will not purchase securities or evidences of ---------------- interest thereon on "margin." This limitation is not applicable to short term credit obtained by the Fund for the clearance of purchases and sales or redemption of securities, or to arrangements with respect to transactions involving options, futures contracts, short sales and other permitted investments and techniques. 4. Short Sales. The Fund will not effect short sales of securities. ----------- 5. Options. The Fund will not purchase or sell puts, calls, options or ------- straddles except as described in the Prospectus or this Statement of Additional Information. 6. Illiquid Investments. The Fund will not invest in securities for which --------------------- there are legal or contractual restrictions on resale and other illiquid securities. 8 7. Loans of Portfolio Securities. The Fund will not make loans of portfolio ----------------------------- securities. 8. 80% Investment Policy. Under normal circumstances, at least 80% of the --------------------- Fund's assets (defined as net assets plus the amount of any borrowing for investment purposes) will be hedged using covered call options. The Fund will not change this policy unless the Fund's shareholders are provided with at least 60 days prior written notice. The notice will be provided in a separate written document, containing the following, or similar, statement, in bold-face type: "Important Notice Regarding Change in Investment Policy." The statement will also appear on the envelope in which the notice is delivered unless the notice is delivered separate from any other communications to the Fund's shareholders. THE INVESTMENT ADVISOR The Fund's investment advisor is Dobson Capital Management, Inc. As sole shareholder of the Advisor, Charles L. Dobson may be deemed to be a controlling person of the Advisor. Under the terms of the management agreement (the "Agreement"), the Advisor manages the Fund's investments subject to approval of the Board of Trustees. As compensation for its management services, the Fund is obligated to pay the Advisor a fee computed and accrued daily and paid monthly at an annual rate of 0.80% of the average value of its daily net assets, less the amount total operating expenses, including the management fee, exceed 1.50% of the average value of its daily net assets. The Advisor has contractually agreed to reimburse the Fund for the operating expenses it incurs (excluding brokerage costs; borrowing costs such as (a) interest and (b) dividends on securities sold short; taxes; and extraordinary expenses), but only to the extent necessary to maintain the Fund's total annual operating expenses at 1.50% of its average daily net assets. For the fiscal years ended July 31, 2004, 2003 and 2002, the Fund paid no advisory fees. The Board of Trustees renewed the Agreement for the Dobson Covered Call Fund at a meeting held on December 8, 2003. The Board of Trustees reviewed copies of the Management Agreement with the Advisor and a letter agreement in which the Advisor agreed to maintain the Fund's total annual operating expenses at 1.50%. The Board also reviewed the Advisor's balance sheet dated November 25, 2003. The Board then discussed the performance report included in the Board materials in which the Fund's performance was compared to the performance of various funds in its peer group, and a report comparing the expenses of the Fund to the expenses of several other funds with similar investment objectives. The Board reviewed and discussed the Administrator Report in which compliance and operational issues relating to the Fund were described. Mr. Dobson then joined the meeting to answer questions and discuss the Agreement. The Board asked Mr. Dobson whether there had been any changes at the Advisor, or changes in processes that would affect the management of the Fund. Mr. Dobson said no changes had been made, nor were any planned, that would affect the management of the Fund. Mr. Dobson then indicated that the Advisor was considering declaring and paying dividends on a quarterly basis. Mr. Dobson then left the meeting and the Board of Trustees discussed the nature and quality of the services provided by the Advisor. Based on the information provided, the Board of 9 Trustees determined that the fees to be paid to the Advisor were reasonable and fair, the overall arrangement provided under the terms of the agreement was a reasonable business arrangement, and that the renewal of the agreement was in the best interests of the Fund's shareholders The Advisor retains the right to use the name "Dobson" in connection with another investment company or business enterprise with which the Advisor is or may become associated. The Trust's right to use the name "Dobson" automatically ceases ninety days after termination of the Agreement and may be withdrawn by the Advisor on ninety days written notice. The Advisor investment adviser (not the Fund) may pay certain financial institutions (which may include banks, brokers, securities dealers and other industry professionals) a fee for providing distribution related services and/or for performing certain administrative servicing functions for Fund shareholders to the extent these institutions are allowed to do so by applicable statute, rule or regulation. The Fund may from time to time purchase securities issued by financial institutions that provide such services; however, in selecting investments for the Fund, no preference will be shown for such securities. DISTRIBUTION PLAN The Fund has adopted a Distribution Plan pursuant to Rule 12b-1 under the 1940 Act (the "Plan"). The Plan permits the Fund to pay directly, or reimburse the Advisor and the Fund's distributor, for distribution expenses in amount not to exceed 0.25% of the average daily net assets of the Fund. Under the Plan, the Trust may engage in any activities related to the distribution of Fund shares, including without limitation the following: (a) payments, including incentive compensation, to securities dealers or other financial intermediaries, financial institutions, investment advisors and others that are engaged in the sale of shares, or that may be advising shareholders of the Trust regarding the purchase, sale or retention of shares, or that hold shares for shareholders in omnibus accounts or as shareholders of record or provide shareholder support or administrative services to the Fund and its shareholders; (b) expenses of maintaining personnel who engage in or support distribution of shares or who render shareholder support services, including, allocated overhead, office space and equipment, telephone facilities and expenses, answering routine inquiries regarding the Trust, processing shareholder transactions, and providing such other shareholder services as the Trust may reasonably request; (c) costs of preparing, printing and distributing prospectuses and statements of additional information and reports of the Fund for recipients other than existing shareholders of the Fund; (d) costs of formulating and implementing marketing and promotional activities, including, sales seminars, direct mail promotions and television, radio, newspaper, magazine and other mass media advertising; (e) costs of preparing, printing and distributing sales literature; (f) costs of obtaining such information, analyses and reports with respect to marketing and promotional activities as the Trust may deem advisable; and (g) costs of implementing and operating the Plan. The Trustees expect that the Plan may significantly enhance the Fund's ability to distribute its shares. The Plan has been approved by the Board of Trustees, including a majority of the Trustees who are not "interested persons" of the Fund and who have no direct or indirect financial interest in the Plan or any related agreement, by a vote cast in person. Continuation of the Plan and the related agreements must be approved by the Trustees annually, in the same manner, and 10 the Plan or any related agreement may be terminated at any time without penalty by a majority of such independent Trustees or by a majority of the outstanding shares of the Fund. Any amendment increasing the maximum percentage payable under the Plan must be approved by a majority of the outstanding shares of the Fund, and all material amendments to the Plan or any related agreement must be approved by the Board of Trustees, including a majority of the independent Trustees. Lynn E. Wood (an officer of the Trust) is a director of the distributor and Anthony Ghoston and Thomas G. Napurano (each an officer of the Trust) are officers of Unified Financial Services, Inc. (the parent of the distributor), and may benefit indirectly from payments received by the distributor. TRUSTEES AND OFFICERS The Board of Trustees supervises the business activities of the Trust. Each Trustee serves as a trustee until termination of the Trust unless the Trustee dies, resigns, retires, or is removed. The following table provides information regarding each Trustee who is an "interested person" of the Trust, as defined in the Investment Company Act of 1940, and each officer of the Trust. INTERESTED TRUSTEE AND PRINCIPAL OFFICERS - --------------------------------------------------- ------------------------------------------------------------------ Name, Address*, (Date of Birth), Position with Principal Occupation During Past 5 Years Fund Complex,** Term of Position with Trust and Other Directorships - --------------------------------------------------- ------------------------------------------------------------------ Ronald C. Tritschler (1952)*** Chief Executive Officer, Director and legal counsel of The Webb Trustee, December 2002 to present Companies, a national real estate company, from 2001 to present; Executive Vice President and Director of The Webb Companies from 1990 to 2000; Director, First State Financial, from 1998 to present; Director, Vice President and legal counsel for The Traxx Companies, an owner and operator of convenience stores, from 1989 to present. Trustee of AmeriPrime Advisors Trust since November 2002 and Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. - --------------------------------------------------- ------------------------------------------------------------------ Anthony J. Ghoston (1959) Executive Vice President of Unified Fund Services, Inc. since June 2004; Senior Vice President of Unified Fund Services, Inc. President, July 2004 to present April 2003 to June 2004; Senior Vice President and Chief Information Officer of Unified Financial Services, Inc. since 1997. - --------------------------------------------------- ------------------------------------------------------------------ Thomas G. Napurano (1941) Chief Financial Officer and Executive Vice President of Unified Financial Services, Inc., the parent company of the Trust's Chief Financial Officer and Treasurer, October administrator and Distributor; Director, Unified Financial 2002 to present Services, Inc., from 1989 to March 2002. CFO of AmeriPrime Advisors Trust since October 2002 and Unified Series Trust since December 2002. CFO of CCMI Funds since June 2003. - --------------------------------------------------- ------------------------------------------------------------------ Freddie Jacobs, Jr. (1970) Vice President, Unified Fund Services, Inc., December 2003 to present; Employed by U.S. Bancorp, 1998 to December 2003. Secretary, September 2004 to present Secretary of AmeriPrime Funds, CCMI Funds and Unified Series Trust since September 2004; Principal Accounting Officer, Lindbergh Funds, since February 2004. - --------------------------------------------------- ------------------------------------------------------------------ Lynn E. Wood (1946) Chairman, Unified Financial Securities, Inc., 1997 to present; Chief Compliance Officer, September 2004 to Director of Compliance, Unified Fund Services, Inc., October present 2003 to September 2004; Chief Compliance Officer, Unified Financial Services, Inc., 2000 to 2004; President and Chief Compliance Officer, Unified Financial Securities, Inc., 1997 to 2000. - --------------------------------------------------- ------------------------------------------------------------------
* The address for each trustee and officer is 431 N. Pennsylvania St., Indianapolis, IN 46204. ** Fund Complex refers to AmeriPrime Advisors Trust, AmeriPrime Funds and Unified Series Trust. The Fund Complex consists of 26 series. 11 *** Mr. Tritschler may be deemed to be an "interested person" of the Trust because he has an ownership interest in Unified Financial Services, Inc., the parent of the distributor of certain series in the Fund Complex. The following table provides information regarding each Trustee who is not an "interested person" of the Trust, as defined in the Investment Company Act of 1940. INDEPENDENT TRUSTEES - ----------------------------------------------------- ---------------------------------------------------------------- Name, Address*, (Date of Birth), Position with Fund Principal Occupation During Past 5 Years and Other Complex,** Term of Position with Trust Directorships - ----------------------------------------------------- ---------------------------------------------------------------- Gary E. Hippenstiel (1947) Director, Vice President and Chief Investment Officer of Legacy Trust Company, N.A. since 1992. Trustee of AmeriPrime Trustee, 1995 to present Advisors Trust since July 2002 and Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. Trustee of Access Variable Insurance Trust, since April 2003. - ----------------------------------------------------- ---------------------------------------------------------------- Stephen A. Little (1946) President and founder, The Rose, Inc., a registered investment advisor, since April 1993. Trustee of AmeriPrime Advisors Trustee, December 2002 to present Trust since November 2002 and Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. - ----------------------------------------------------- ---------------------------------------------------------------- Daniel J. Condon (1950) President, 2004 to present, Vice President and General Manager, 1990 to 2003, International Crankshaft Inc., an Trustee, December 2002 to present automotive equipment manufacturing company; Trustee, The Unified Funds, from 1994 to 2002; Trustee, Firstar Select Funds, a REIT mutual fund, from 1997 to 2000. Trustee of AmeriPrime Advisors Trust since November 2002 and Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. - ----------------------------------------------------- ----------------------------------------------------------------
* The address for each trustee and officer is 431 N. Pennsylvania St., Indianapolis, IN 46204. ** Fund Complex refers to AmeriPrime Advisors Trust, AmeriPrime Funds and Unified Series Trust. The Fund Complex consists of 26 series. The Trust's audit committee consists of Gary Hippenstiel, Stephen Little, and Daniel Condon. The audit committee is responsible for overseeing the Fund's accounting and financial reporting policies and practices, its internal controls and, as appropriate, the internal controls of certain service providers; overseeing the quality and objectivity of the Fund's financial statements and the independent audit of the financial statements; and acting as a liaison between the Fund's independent auditors and the full Board of Trustees. The audit committee held four meetings during the fiscal year ended July 31, 2004. The following table provides information regarding shares of the Fund and other portfolios of the AmeriPrime Family of Funds owned by each Trustee as of December 31, 2003. =============================== ================================ ============================================= AGGREGATE DOLLAR RANGE OF SHARES OF ALL TRUSTEE DOLLAR RANGE OF FUND SHARES FUNDS OVERSEEN BY THE TRUSTEE WITHIN THE AMERIPRIME FUND COMPLEX1 ------------------------------- -------------------------------- --------------------------------------------- Daniel Condon NONE NONE ------------------------------- -------------------------------- --------------------------------------------- Gary E. Hippenstiel NONE NONE ------------------------------- -------------------------------- --------------------------------------------- Stephen Little NONE NONE ------------------------------- -------------------------------- --------------------------------------------- Ronald Tritschler NONE NONE =============================== ================================ ============================================= 1 "Fund Complex" refers to AmeriPrime Funds, AmeriPrime Advisors Trust and Unified Series Trust.
12 The compensation paid to the Trustees of the Trust for the fiscal year ended July 31, 2004 is set forth in the following table. Trustee fees are Trust expenses and each series of the Trust pays a portion of the Trustee fees. ==================================== =================== =================== =================== ====================== AGGREGATE PENSION OR ESTIMATED ANNUAL TOTAL COMPENSATION COMPENSATION RETIREMENT BENEFITS UPON FROM TRUST AND FUND INDEPENDENT TRUSTEES FROM EACH FUND BENEFITS ACCRUED RETIREMENT COMPLEX* AS PART OF FUND EXPENSES - ------------------------------------ ------------------- ------------------- ------------------- ---------------------- Gary Hippenstiel, Trustee and $972 $0 $0 $20,000 Chairman of the Audit Committee - ------------------------------------ ------------------- ------------------- ------------------- ---------------------- Stephen Little, Trustee** $632 $0 $0 $13,000 - ------------------------------------ ------------------- ------------------- ------------------- ---------------------- Daniel Condon, Trustee $632 $0 $0 $13,000 ==================================== =================== =================== =================== ====================== AGGREGATE PENSION OR ESTIMATED ANNUAL TOTAL COMPENSATION NON-INDEPENDENT TRUSTEES AND COMPENSATION RETIREMENT BENEFITS UPON FROM TRUST AND FUND OFFICERS FROM EACH FUND BENEFITS ACCRUED RETIREMENT COMPLEX* AS PART OF FUND EXPENSES - ------------------------------------ ------------------- ------------------- ------------------- ---------------------- Ronald C. Tritschler, Trustee $535 $0 $0 $11,000 - ------------------------------------ ------------------- ------------------- ------------------- ---------------------- * Fund Complex refers to AmeriPrime Advisors Trust, AmeriPrime Funds and Unified Series Trust. The Fund Complex currently consists of 26 series.
Effective June 30, 2004, it is estimated that Gary Hippenstiel, Stephen Little, Daniel Condon and Ronald C. Tritschler will be paid annual compensation of $1,241, $1,241, $828 and $828, respectively, by each series of the Fund Complex on an individual basis, and $36,000, $36,000, $24,000 and $24,000, respectively, by the Fund Complex on an aggregate basis, assuming that there are 26 series in the Fund Complex.1 Trustees' fees and expenses are Fund Complex expenses and each series incurs its pro rata share of expenses based on the number of series in the Fund Complex. As a result, the amount paid by each series will increase or decrease as new series are added to or removed from the Fund Complex. PORTFOLIO TRANSACTIONS AND BROKERAGE Subject to policies established by the Board of Trustees, the Advisor is responsible for the Fund's portfolio decisions and the placing of the Fund's portfolio transactions. In placing portfolio transactions, the Advisor seeks the best qualitative execution for the Fund, taking into account such factors as price (including the applicable brokerage commission or dealer spread), the execution capability, financial responsibility and responsiveness of the broker or dealer and the brokerage and research services provided by the broker or dealer. The Advisor generally seeks favorable prices and commission rates that are reasonable in relation to the benefits received. The Advisor may not give consideration to sales of shares of the Trust as a factor in the selection of - ------------------------ 1 For the period June 30, 2004 to September 30, 2004, Mr. Little's annual compensation was set at $24,000. Upon his assumption of the role of Lead Independent Trustee effective as of October 1, 2004, Mr. Little's annual compensation was increased to $36,000. 13 brokers and dealers to execute portfolio transactions. However, the Advisor may place portfolio transactions with brokers or dealers that promote or sell the Fund's shares so long as such placements are made pursuant to policies approved by the Fund's Board of Trustees that are designed to ensure that the selection is based on the quality of the broker's execution and not on its sales efforts. The Advisor is specifically authorized to select brokers or dealers who also provide brokerage and research services to the Fund and/or the other accounts over which the Advisor exercises investment discretion and to pay such brokers or dealers a commission in excess of the commission another broker or dealer would charge if the Advisor determines in good faith that the commission is reasonable in relation to the value of the brokerage and research services provided. The determination may be viewed in terms of a particular transaction or the Advisor's overall responsibilities with respect to the Trust and to other accounts over which it exercises investment discretion. Research services include supplemental research, securities and economic analyses, statistical services and information with respect to the availability of securities or purchasers or sellers of securities and analyses of reports concerning performance of accounts. The research services and other information furnished by brokers through whom the Fund effects securities transactions may also be used by the Advisor in servicing all of its accounts. Similarly, research and information provided by brokers or dealers serving other clients may be useful to the Advisor in connection with its services to the Fund. Although research services and other information are useful to the Fund and the Advisor, it is not possible to place a dollar value on the research and other information received. It is the opinion of the Board of Trustees and the Advisor that the review and study of the research and other information will not reduce the overall cost to the Advisor of performing its duties to the Fund under the Agreement. Over-the-counter transactions will be placed either directly with principal market makers or with broker-dealers, if the same or a better price, including commissions and executions, is available. Fixed income securities are normally purchased directly from the issuer, an underwriter or a market maker. Purchases include a concession paid by the issuer to the underwriter and the purchase price paid to a market maker may include the spread between the bid and asked prices. When the Fund and another of the Advisor's clients seek to purchase or sell the same security at or about the same time, the Advisor may execute the transaction on a combined ("blocked") basis. Blocked transactions can produce better execution for the Fund because of the increased volume of the transaction. If the entire blocked order is not filled, the Fund may not be able to acquire as large a position in such security as it desires or it may have to pay a higher price for the security. Similarly, the Fund may not be able to obtain as large an execution of an order to sell or as high a price for any particular portfolio security if the other client desires to sell the same portfolio security at the same time. In the event that the entire blocked order is not filled, the purchase or sale will normally be allocated on a pro rata basis. The allocation may be adjusted by the Advisor, taking into account such factors as the size of the individual orders and transaction costs, when the Advisor believes adjustment is reasonable. 14 For the fiscal years ended July 31, 2004, 2003 and 2002, the Fund paid brokerage commissions of $2,571, $4,320, and $7,524, respectively. The Trust, the Advisor and the Fund's distributor have each adopted a Code of Ethics (the "Code") under Rule 17j-1 of the Investment Company Act of 1940. The personnel subject to the Code are permitted to invest in securities, including securities that may be purchased or held by the Fund. You may obtain a copy of the Code from the Securities and Exchange Commission. DETERMINATION OF SHARE PRICE The price (net asset value) of the shares of each Fund is determined at the close of trading (normally 4:00 p.m., Eastern time) on each day the New York Stock Exchange is open for business (the Exchange is closed on weekends, most federal holidays, and Good Friday). For a description of the methods used to determine the net asset value (share price), see "Determination of Net Asset Value" in the Prospectus. Equity securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the Advisor believes such prices accurately reflect the fair market value of such securities. Securities that are traded on any stock exchange are generally valued by the pricing service at the last quoted sale price. Lacking a last sale price, an exchange traded security is generally valued by the pricing service at its last bid price. Securities traded in the NASDAQ over-the-counter market are generally valued by the pricing service at the NASDAQ Official Closing Price. When market quotations are not readily available, when the Advisor determines that the market quotation or the price provided by the pricing service does not accurately reflect the current market value or when restricted or illiquid securities are being valued, such securities are valued as determined in good faith by the Advisor, in conformity with guidelines adopted by and subject to review of the Board of Trustees of the Trust. Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the Advisor believes such prices accurately reflect the fair market value of such securities. A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional-size trading units of debt securities without regard to sale or bid prices. If the Advisor decides that a price provided by the pricing service does not accurately reflect the fair market value of the securities, when prices are not readily available from a pricing service, or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith by the Advisor, subject to review of the Board of Trustees. Short term investments in fixed income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value. ADDITIONAL TAX INFORMATION The Fund has qualified and intends to continue to qualify as a regulated investment company, or "RIC", under the Internal Revenue Code of 1986, as amended (the "Code"). 15 Qualification generally will relieve the Fund of liability for federal income taxes. If for any taxable year the Fund does not qualify for the special tax treatment afforded regulated investment companies, all of its taxable income will be subject to federal tax at regular corporate rates (without any deduction for distributions to its shareholders). In such event, dividend distributions would be taxable to shareholders to the extent of the Fund's earnings and profits, and would be eligible for the dividends-received deduction for corporations. The Fund's net realized capital gains from securities transactions will be distributed only after reducing such gains by the amount of any available capital loss carryforwards. Capital losses may be carried forward to offset any capital gains for eight years, after which any undeducted capital loss remaining is lost as a deduction. As of July 31, 2004, the Fund had capital loss carryforwards of $108,527 expiring in 2012. CUSTODIAN UMB Bank, N.A., 928 Grand Blvd., 10th floor, Kansas City, Missouri 64106, is custodian of the Fund's investments. The custodian acts as the Fund's depository, safekeeps its portfolio securities, collects all income and other payments with respect thereto, disburses funds at the Fund's request and maintains records in connection with its duties. FUND SERVICES Unified Fund Services, Inc. ("Unified"), 431 North Pennsylvania Street, Indianapolis, Indiana 46204, acts as the Fund's transfer agent. Three officers of the Trust are members of management and/or employees of Unified and/or its parent company, Unified Financial Services, Inc. Unified maintains the records of each shareholder's account, answers shareholders' inquiries concerning their accounts, processes purchases and redemptions of the Fund's shares, acts as dividend and distribution disbursing agent and performs other transfer agent and shareholder service functions. Unified receives a monthly fee from the Fund of $1.25 per shareholder (subject to a minimum monthly fee of $1,250) for these transfer agency services. For the fiscal years ended July 31, 2004, 2003 and 2002, Unified received fees of $11,394, $10,960 and $11,532 from the Fund for transfer agent services provided to the Fund. In addition, Unified provides the Fund with fund accounting services, which includes certain monthly reports, record-keeping and other management-related services. For its services as Fund accountant, Unified receives an annual fee from the Advisor equal to 0.0500% of the Fund's assets up to $50 million, 0.0400% of the Fund's assets from $50 million to $100 million, and 0.0300% of the Fund's assets from $100 million to $150 million and 0.0200% over $150 million (subject to various monthly minimum fees, the maximum being $1,666 per month). For the fiscal years ended July 31, 2004, 2003 and 2002, Unified received $14,545, $9,600 and $13,066 from the Fund for these accounting services, respectively. Unified also provides the Fund with administrative services, including all regulatory reporting and necessary office equipment, personnel and facilities. Unified receives a monthly fee from the Fund equal to an annual rate of 0.10% of the Fund's assets under $50 million, 0.0700% of the Fund's assets from $50 million to $100 million, and 0.050% of the Fund's assets $100 16 million to $150 million and 0.0300% over $150 million (subject to a minimum fee of $2,500 per month). For the fiscal years ended July 31, 2004, 2003 and 2002, Unified received $31,958, $30,000, and $30,000 for these administrative services, respectively. ACCOUNTANTS The firm of Cohen McCurdy, Ltd., 826 Westpoint Parkway, Suite 1250, Westlake, Ohio 44145, has been selected as independent public accountants for the Fund for the fiscal year ending July 31, 2005. Cohen McCurdy, Ltd. performs an annual audit of the Fund's financial statements and provides financial, tax and accounting consulting services as requested. DISTRIBUTOR Unified Financial Securities, Inc., 431 North Pennsylvania Street, Indianapolis, Indiana 46204 (the "Distributor"), is the exclusive agent for distribution of shares of the Funds. Lynn E. Wood (an officer of the Trust) is a director of the distributor, and Anthony Ghoston and Thomas G. Napurano (each an officer of the Trust) are officers of Unified Financial Services, Inc. (the parent of the distributor), and may be deemed to be affiliates of the Distributor. The Distributor is obligated to sell the shares of the Fund on a best efforts basis only against purchase orders for the shares. Shares of the Funds are offered to the public on a continuous basis. The Distributor and Unified are controlled by Unified Financial Services, Inc. PROXY VOTING POLICIES The Board of Trustees of the Trust has delegated responsibilities for decisions regarding proxy voting for securities held by the Funds to the Funds' Advisor. The Advisor will vote such proxies in accordance with its proxy policies and procedures. In some instances, the Advisor may be asked to cast a proxy vote that presents a conflict between the interests of a Fund's shareholders, and those of the Advisor or an affiliated person of the Advisor. In such a case, the Trust's policy requires that the Advisor abstain from making a voting decision and to forward all necessary proxy voting materials to the Trust to enable the Board of Trustees to make a voting decision. When the Board of Trustees of the Trust is required to make a proxy voting decision, only the Trustees without a conflict of interest with regard to the security in question or the matter to be voted upon shall be permitted to participate in the decision of how the applicable Fund's vote will be cast. The Advisor's policies and procedures state that the Advisor generally relies on the individual portfolio manager(s) to make the final decision on how to cast proxy votes. When exercising its voting responsibilities, the Advisor's policies call for an emphasis on (i) accountability of management of the company to its board, and of the board to the company's shareholders, (ii) alignment of management and shareholder interests and (iii) transparency through timely disclosure of important information about a company's operations and financial performance. While no set of proxy voting guidelines can anticipate all situations that may arise, 17 the Advisor has adopted guidelines describing the Advisor's general philosophy when proposals involve certain matters. The following is a summary of those guidelines: o electing a board of directors - a board should be composed primarily of independent directors, and key board committees should be entirely independent. The Advisor generally supports efforts to declassify boards or other measures that permit shareholders to remove a majority of directors at any time; o approving independent auditors - the relationship between a company and its auditors should be limited primarily to the audit engagement; o providing equity-based compensation plans - appropriately designed equity-based compensation plans, approved by shareholders, can be an effective way to align the interests of shareholders and the interests of directors, management, and employees by providing incentives to increase shareholder value. Conversely, the Advisor is opposed to plans that substantially dilute ownership interests in the company, provide participants with excessive awards, or have inherently objectionable structural features; o corporate voting structure - shareholders should have voting power equal to their equity interest in the company and should be able to approve or reject changes to a company's by-laws by a simple majority vote. The Advisor opposes super-majority requirements and generally supports the ability of shareholders to cumulate their votes for the election of directors; and o shareholder rights plans - shareholder rights plans, also known as poison pills, may tend to entrench current management, which the Advisor generally considers to have a negative impact on shareholder value. The actual voting records relating to portfolio securities during the most recent 12-month period ended June 30 are available without charge, upon request, by calling toll free, 1-800-723-8637 or by accessing the SEC's website at www.sec.gov. In addition, a copy of the Fund's proxy voting policies and procedures are also available by calling 1-800-723-8637 and will be sent within three business days of receipt of a request. FINANCIAL STATEMENTS The financial statements and independent auditors' report required to be included in the Statement of Additional Information are hereby incorporated by reference to the Fund's annual report to the shareholders for the period ended July 31, 2004. The Trust will provide the annual report without charge by calling the Fund at 1-877-236-2766. 18 PART C: OTHER INFORMATION ITEM 23. EXHIBITS (a) Articles of Incorporation. (i) Copy of Registrant's Declaration of Trust, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 11 on December 16, 1997, is hereby incorporated by reference. (ii) Copy of Amendment No. 10 to Registrant's Declaration of Trust, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 16 on May 6, 1998, is hereby incorporated by reference. (iii) Copy of Amendment No. 14 to Registrant's Declaration of Trust, which were filed as Exhibits to Registrant's Post-Effective Amendment No. 27 on July 16, 1999, is hereby incorporated by reference. (iv) Copy of Amendment No. 24 to Registrant's Declaration of Trust, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 74 on November 4, 2002, is hereby incorporated by reference. (b) By-Laws. Copy of Registrant's Amended By-Laws are filed herewith. (c) Instruments Defining Rights of Security Holders. None, other than in the Declaration of Trust, as amended, and By-Laws of the Registrant. (d) Investment Advisory Contracts. (i) Copy of Registrant's Management Agreement with Appalachian Asset Management, Inc., adviser to the AAM Equity Fund, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 71 on August 1, 2002, is hereby incorporated by reference. (ii) Copy of Registrant's Management Agreement with Dobson Capital Management, Inc., adviser to the Dobson Covered Call Fund, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 25 on April 23, 1999, is hereby incorporated by reference. (e) Underwriting Contracts. (i) Copy of Registrant's Underwriting Agreement with Unified Financial Securities, Inc., which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 50 on March 1, 2001, is hereby incorporated by reference. (ii) Copy of Registrant's Addendum No 1 to Underwriting Agreement dated December 14, 2000 between Registrant and Unified Financial Securities, Inc., which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 82 on February 27, 2004, is hereby incorporated by reference. -1- (iii) Form Addendum No 2 to Underwriting Agreement dated December 14, 2000 between Registrant and Unified Financial Securities, Inc. for IMS Capital Management, Columbia Partners, LLC, Appalachian Asset Management, Dobson Capital Management and The Jumper Group, Inc., which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 82 on February 27, 2004, is hereby incorporated by reference. (iv) Copy of Registrant's Addendum No 3 to Underwriting Agreement dated December 14, 2000 between Registrant and Unified Financial Securities, Inc., which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 82 on February 27, 2004, is hereby incorporated by reference. (f) Bonus or Profit Sharing Contracts. None. (g) Custodian Agreements. (i) Copy of Registrant's Agreement with the custodian, U.S. Bank, N.A. (formerly Firstar Bank), which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 11 on December 16, 1997, is hereby incorporated by reference. (ii) Copy of Registrant's Appendix B to the Agreement with the custodian, U.S. Bank, N.A., which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 43 on August 1, 2000, is hereby incorporated by reference. (iii) Copy of Registrant's Agreement with UMB Bank, N.A., custodian to the Dobson Covered Call Fund, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 28 on July 30, 1999, is hereby incorporated by reference. (h) Other Material Contracts. (i) Copy of Registrant's Administrative Services Agreement with the administrator, Unified Fund Services, Inc., is filed herewith. (i) Legal Opinion. (i) Opinion of Thompson Hine LLP, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 76 on January 31, 2003, is hereby incorporated by reference. (ii) Consent of Thompson Hine LLP is filed herewith. (j) Other Opinions. Consent of Accountant is filed herewith. (k) Omitted Financial Statements. -2- None. (l) Initial Capital Agreements. Copy of Letter of Initial Stockholders, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 11 on December 16, 1997, is hereby incorporated by reference. (m) Rule 12b-1 Plan. (i) Copy of Registrant's Rule 12b-1 Distribution Plan for the Dobson Covered Call Fund, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 24 on February 17, 1999, is hereby incorporated by reference. (n) Rule 18f-3 Plan. None. (o) Reserved. (p) Codes of Ethics. Amended Code of Ethics of the Registrant, its underwriter (Unified Financial Securities, Inc.), and the advisers, which was filed as an Exhibit to Registrant's Post-Effective Amendment No. 77 on February 28, 2003, is hereby incorporated by reference. (q) Powers of Attorney (i) Powers of Attorney for the Treasurer, Registrant and Certificate of the Trust, which were filed as Exhibits to Registrant's Post-Effective Amendment No. 74 on November 4, 2002, are hereby incorporated by reference. (ii) Powers of Attorney for Daniel Condon and Ronald C. Tritschler, Trustees of the Trust, which were filed as Exhibits to Registrant's Post-Effective Amendment No. 76 on January 31, 2003, are hereby incorporated by reference. (iii) Powers of Attorney for Stephen A. Little and Gary E. Hippenstiel, Trustees of the Trust, which were filed as Exhibits to Registrant's Post-Effective Amendment No. 79 on October 14, 2003, are hereby incorporated by reference. ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL None. -3- ITEM 25. INDEMNIFICATION (a) Article VI of the Registrant's Agreement and Declaration of Trust provides for indemnification of officers and Trustees as follows: Section 6.4 Indemnification of Trustees, Officers, etc. Subject to and ----------- --------------------------------------------- except as otherwise provided in the Securities Act of 1933, as amended, and the 1940 Act, the Trust shall indemnify each of its Trustees and officers (including persons who serve at the Trust's request as directors, officers or trustees of another organization in which the Trust has any interest as a shareholder, creditor or otherwise (hereinafter referred to as a "Covered Person") against all liabilities, including but not limited to amounts paid in satisfaction of judgments, in compromise or as fines and penalties, and expenses, including reasonable accountants' and counsel fees, incurred by any Covered Person in connection with the defense or disposition of any action, suit or other proceeding, whether civil or criminal, before any court or administrative or legislative body, in which such Covered Person may be or may have been involved as a party or otherwise or with which such person may be or may have been threatened, while in office or thereafter, by reason of being or having been such a Trustee or officer, director or trustee, and except that no Covered Person shall be indemnified against any liability to the Trust or its Shareholders to which such Covered Person would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such Covered Person's office. Section 6.5 Advances of Expenses. The Trust shall advance attorneys' fees ----------- -------------------- or other expenses incurred by a Covered Person in defending a proceeding to the full extent permitted by the Securities Act of 1933, as amended, the 1940 Act, and Ohio Revised Code Chapter 1707, as amended. In the event any of these laws conflict with Ohio Revised Code Section 1701.13(E), as amended, these laws, and not Ohio Revised Code Section 1701.13(E), shall govern. Section 6.6 Indemnification Not Exclusive, etc. The right of ------------- ---------------------------------------- indemnification provided by this Article VI shall not be exclusive of or affect any other rights to which any such Covered Person may be entitled. As used in this Article VI, "Covered Person" shall include such person's heirs, executors and administrators. Nothing contained in this article shall affect any rights to indemnification to which personnel of the Trust, other than Trustees and officers, and other persons may be entitled by contract or otherwise under law, nor the power of the Trust to purchase and maintain liability insurance on behalf of any such person. The Registrant may not pay for insurance which protects the Trustees and officers against liabilities rising from action involving willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of their offices. (b) The Registrant may maintain a standard mutual fund and investment advisory professional and directors and officers liability policy. The policy, if maintained, would provide coverage to the Registrant, its Trustees and officers, and could cover its advisers, among others. Coverage under the policy would include losses by reason of any act, error, omission, misstatement, misleading statement, neglect or breach of duty. -4- (c) Pursuant to the underwriting agreement with Unified Financial Securities, Inc., the Trust has agreed to indemnify the underwriter and each of the underwriter's employees (hereinafter referred to as a "Covered Person") against all liabilities, including, but not limited to, amounts paid in satisfaction of judgments, in compromise or as fines and penalties, and expenses, including reasonable accountants' and counsel fees, incurred by any Covered Person in connection with the defense or disposition of any action, suit or other proceeding, whether civil or criminal, before any court or administrative or legislative body, in which such Covered Person may be or may have been involved as a party or otherwise or with which such person may be or may have been threatened, while serving as the underwriter for the Trust or as one of the underwriter's employees, or thereafter, by reason of being or having been the underwriter for the Trust or one of the underwriter's employees, including, but not limited to, liabilities arising due to any misrepresentation or misstatement in the Trust's prospectus, other regulatory filings, and amendments thereto, or in other documents originating from the Trust. In no case shall a Covered Person be indemnified against any liability to which such Covered Person would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties of such Covered Person. (d) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to trustees, officers and controlling persons of the Registrant pursuant to the provisions of Ohio law and the Agreement and Declaration of the Registrant or the By-Laws of the Registrant, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a trustee, officer or controlling person of the Trust in the successful defense of any action, suit or proceeding) is asserted by such trustee, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. ITEM 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER (a) Appalachian Asset Management, Inc. ("AAM"), 2000 Deitrick Blvd. Charleston, West Virginia 25311, adviser to AAM Equity Fund, is a registered investment adviser. (i) AAM has engaged in no other business during the past two fiscal years. ------------------------ ------------------------------------------ -------------------------------- (ii) Name Position with Adviser Other Business Activities ------------------------ ------------------------------------------ -------------------------------- Knox H. Fuqua President and Director None ------------------------ ------------------------------------------ -------------------------------- Teresa Shawver Treasurer/Secretary None ------------------------ ------------------------------------------ -------------------------------- Will W. Carter Vice President and Director None ------------------------ ------------------------------------------ --------------------------------
(b) Dobson Capital Management, Inc. ("Dobson"), 1422 Van Ness Street, Santa Ana, CA 92707, adviser to the Dobson Covered Call Fund, is a registered investment adviser. (i) Dobson has engaged in no other business during the past two fiscal years. -5- (ii) Charles L. Dobson is the sole officer and director of Dobson. ITEM 27. PRINCIPAL UNDERWRITERS (a) Unified Financial Securities, Inc., 431 North Pennsylvania Street, Indianapolis, Indiana 46204, is the Registrant's principal underwriter (the "Underwriter") for each series of the Trust. Unified Financial Securities, Inc. is also the underwriter for the Access Variable Insurance Trust, AmeriPrime Advisors Trust, CCMI Funds, Forester Funds, Julius Baer Investment Funds, Lindbergh Funds, Milestone Funds, Runkel Funds, Sparrow Funds, TANAKA Funds, TrendStar Investment Trust and Unified Series Trust. (b) Information with respect to each director and officer of Unified Financial Securities, Inc.: - ---------------------------------------- -------------------------------------- -------------------------------------- Name and Principal Positions and Offices Positions with Business Address with Underwriter Offices with Fund - ---------------------------------------- -------------------------------------- -------------------------------------- Mark C. Lewis Vice President None 431 North Pennsylvania Street Indianapolis, Indiana 46204 - ---------------------------------------- -------------------------------------- -------------------------------------- Stephen D. Highsmith, Jr. Director, President, CEO and None 431 North Pennsylvania Street Secretary Indianapolis, Indiana 46204 - ---------------------------------------- -------------------------------------- -------------------------------------- Thomas G. Napurano Executive Vice President and CFO Treasurer 431 North Pennsylvania Street Indianapolis, Indiana 46204 - ---------------------------------------- -------------------------------------- -------------------------------------- Lynn E. Wood Director and Chairman None 431 North Pennsylvania Street Indianapolis, Indiana 46204 - ---------------------------------------- -------------------------------------- -------------------------------------- Karyn E. Cunningham Controller None 431 North Pennsylvania Street Indianapolis, Indiana 46204 - ---------------------------------------- -------------------------------------- --------------------------------------
(c) Not applicable. ITEM 28. LOCATION OF ACCOUNTS AND RECORDS Accounts, books and other documents required to be maintained by Section 31(a) of the Investment Company Act of 1940 and the rules promulgated thereunder will be maintained by: the Registrant at 431 North Pennsylvania Street, Indianapolis, Indiana 46204; and/or by the Registrant's custodians, U.S. Bank, N.A., 425 Walnut Street, Cincinnati, Ohio 45202 and UMB Bank, N.A., Securities Administration Dept., 928 Grand Blvd., 10th Floor, Kansas City, MO 64106; and/or by the Registrant's transfer agent, Unified Fund Services, Inc., 431 North Pennsylvania Street, Indianapolis, Indiana 46204. -6- ITEM 29. MANAGEMENT SERVICES None. ITEM 30. UNDERTAKINGS None. -7- SIGNATURES ---------- Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets all the requirements for effectiveness of this Registration Statement under Rule 485(b) under the Securities Act and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Cincinnati, State of Ohio on the 24 day of November, 2004. AmeriPrime Funds By: /s/ Donald S.Mendelsohn --------------------------- Donald S. Mendelsohn, Attorney-in-Fact Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated. Stephen A. Little,* Trustee *By: /s/ Donald S. Mendelsohn --------------------------- Gary E. Hippenstiel,* Trustee Donald S. Mendelsohn, Daniel Condon,* Trustee Attorney-in-Fact Ronald C. Tritschler,* Trustee November 24, 2004 /s/ Anthony J. Ghoston _______________________________ November 24, 2004 Anthony J. Ghoston, President /s/ Thomas G. Napurano _______________________________ November 24, 2004 Thomas G. Napurano Treasurer and Chief Financial Officer -8- EXHIBIT INDEX ------------- 1. Amended By-Laws ...............................................EX-99.23.b 2. Administrative Services Agreement .............................EX-99.23.h(i) 3. Consent of Thompson Hine LLP...................................EX-99.23.i 4. Consent of Accountant..........................................EX-99.23.j EX-99.B 2 ex9923b.txt AMENDED BY-LAWS EX-99.23.b BY-LAWS OF AMERIPRIME FUNDS ARTICLE 1 AGREEMENT AND DECLARATION OF TRUST AND OFFICES ---------------------------------------------- 1.1 Agreement and Declaration of Trust. These By-Laws shall be subject to ----------------------------------- the Agreement and Declaration of Trust, as from time to time in effect (the "Declaration of Trust"), of AmeriPrime Funds, the Ohio business trust established by the Declaration of Trust (the "Trust"). 1.2 Offices. The Trust may maintain one or more other offices, including ------- its principal office, in or outside of Ohio, in such cities as the Trustees may determine from time to time. Unless the Trustees otherwise determine, the principal office of the Trust shall be located in Southlake, Texas. ARTICLE 2 Meetings of Trustees -------------------- 2.1 Regular Meetings. Regular meetings of the Trustees may be held without ---------------- call or notice at such places and at such times as the Trustees may from time to time determine, provided that notice of the first regular meeting following any such determination shall be given to absent Trustees. A regular meeting of the Trustees may be held without call or notice immediately after and at the same place as any meeting of the shareholders. 2.2 Special Meetings. Special meetings of the Trustees may be held at any ----------------- time and at any place designated in the call of the meeting when called by the President or the Treasurer or by two or more Trustees, sufficient notice thereof being given to each Trustee by the Secretary or an Assistant Secretary or by the officer or the Trustees calling the meeting. 2.3 Notice. It shall be sufficient notice to a Trustee of a special meeting ------ to send notice by mail at least forty-eight hours or by telegram at least twenty-four hours before the meeting addressed to the Trustee at his or her usual or last known business or residence address or to give notice to him or her in person or by telephone at least twenty-four hours before the meeting. Notice of a meeting need not be given to any Trustee if a written waiver of notice, executed by him or her before or after the meeting, is filed with the records of the meeting, or to any Trustee who attends the meeting without protesting prior thereto or at its commencement the lack of notice to him or her. Neither notice of a meeting nor a waiver of a notice need specify the purposes of the meeting. 2.4 Quorum. At any meeting of the Trustees a majority of the Trustees then ------ in office shall constitute a quorum. Any meeting may be adjourned from time to time by a majority of the votes cast upon the question, whether or not a quorum is present, and the meeting may be held as adjourned without further notice. 2.5 Participation by Telephone. One or more of the Trustees or of any ---------------------------- committee of the Trustees may participate in a meeting thereof by means of a conference telephone or similar communications equipment allowing all persons participating in the meeting to hear each other at the same time. Participation by such means shall constitute presence in person at a meeting except as otherwise provided by the Investment Company Act of 1940. 2.6 Action by Consent. Any action required or permitted to be taken at any ----------------- meeting of the Trustees or any committee thereof may be taken without a meeting, if a written consent of such action is signed by a majority of the Trustees then in office or a majority of the members of such committee, as the case may be, and such written consent is filed with the minutes of the proceedings of the Trustees or such committee. ARTICLE 3 Officers -------- 3.1Enumeration and Qualification. The officers of the Trust shall be a ------------------------------- President, a Chief Compliance Officer, a Treasurer, a Secretary and such other officers, including Vice Presidents, if any, as the Trustees from time to time may in their discretion elect. The Trust may also have such agents as the Trustees from time to time may in their discretion appoint. Any officer may be, but need not be, a Trustee or shareholder. The same person may hold any two or more offices. 3.2Election. The President, the Treasurer and the Secretary shall be -------- elected annually by the Trustees. Other officers, if any, may be elected or appointed by the Trustees at any time. Vacancies in any office may be filled at any time. 3.3Tenure. The President, the Treasurer and the Secretary shall hold office ------ for one year and until their respective successors are chosen and qualified, or in each case until he or she sooner dies, resigns, is removed or becomes disqualified. Each other officer shall hold office and each agent shall retain authority at the pleasure of the Trustees. 3.4Powers. Subject to the other provisions of these By-Laws, each officer ------ shall have, in addition to the duties and powers herein and in the Declaration of Trust set forth, such duties and powers as are commonly incident to the office occupied by him or her as if the Trust were organized as an Ohio business corporation and such other duties and powers as the Trustees may from time to time designate. 3.5President. Unless the Trustees otherwise provide, the President, or in --------- the absence of the President, any Trustee chosen by the Trustees, shall preside at all meetings of the shareholders and of the Trustees. The President shall be the chief executive officer. 3.6Chief Compliance Officer. The Chief Compliance Officer of the Trust will ------------------------ be responsible for administering its compliance policies and procedures, shall have sufficient authority and independence within the organization to compel others to adhere to the compliance policies and procedures, shall report directly to the Board of Trustees, shall annually furnish a written report on the operation of the compliance policies and procedures to the Board of Trustees and shall perform such other duties as prescribed by the Board of Trustees. 3.7Treasurer. The Treasurer shall be the chief financial and accounting officer of the Trust, and shall, subject to the provisions of the Declaration of Trust and to any arrangement made by the Trustees with a custodian, investment adviser or manager, or transfer, shareholder servicing or similar agent, be in charge of the valuable papers, books of account and accounting records of the Trust, and shall have such other duties and powers as may be designated from time to time by the Trustees or by the President. 3.8Secretary. The Secretary shall record all proceedings of the --------- shareholders and the Trustees in books to be kept therefore, which books or a copy thereof shall be kept at the principal office of the Trust. In the absence of the Secretary from any meeting of the shareholders or Trustees, an assistant secretary, or if there be none or if he or she is absent, a temporary secretary chosen at such meeting shall record the proceedings thereof in the aforesaid books. 3.9Resignations and Removals. Any Trustee or officer may resign at any time ------------------------- by written instrument signed by him or her and delivered to the President or the Secretary or to a meeting of the Trustees. Such resignation shall be effective upon receipt unless specified to be effective at some other time. The Trustees may remove any officer elected by them with or without cause. Except to the extent expressly provided in a written agreement with the Trust, no Trustee or officer resigning and no officer removed shall have any right to any compensation for any period following his or her resignation or removal, or any right to damages on account of such removal. ARTICLE 4 Committees ---------- 4.1General. The Trustees, by vote of a majority of the Trustees then in ------- office, may elect from their number an Executive Committee or other committees and may delegate thereto some or all of their powers except those which by law, by the Declaration of Trust, or by these By-Laws may not be delegated. Except as the Trustees may otherwise determine, any such committee may make rules for the conduct of its business, but unless otherwise provided by the Trustees or in such rules, its business shall be conducted so far as possible in the same manner as is provided by these By-Laws for the Trustees themselves. All members of such committees shall hold such offices at the pleasure of the Trustees. The Trustees may abolish any such committee at any time. Any committee to which the Trustees delegate any of their powers or duties shall keep records of its meetings and shall report its action to the Trustees. The Trustees shall have power to rescind any action of any committee, but no such rescission shall have retroactive effect. ARTICLE 5 Reports 5.1General. The Trustees and officers shall render reports at the time and ------- in the manner required by the Declaration of Trust or any applicable law. Officers and Committees shall render such additional reports as they may deem desirable or as may from time to time be required by the Trustees. ARTICLE 6 Fiscal Year ----------- 6.1General. The fiscal year of the Trust shall be fixed by, and shall be ------- subject to change by, the Trustees. ARTICLE 7 Seal ---- 7.1General. If required by applicable law, the seal of the Trust shall ------- consist of a flat-faced die with the word "Ohio", together with the name of the Trust and the year of its organization cut or engraved thereon, but, unless otherwise required by the Trustees, the seal shall not be necessary to be placed on, and its absence shall not impair the validity of, any document, instrument or other paper executed and delivered by or on behalf of the Trust. ARTICLE 8 Execution of Papers ------------------- 8.1General. Except as the Trustees may generally or in particular cases ------- authorize the execution thereof in some other manner, all deeds, leases, contracts, notes and other obligations made by the Trustees shall be signed by the President, any Vice President, or by the Treasurer and need not bear the seal of the Trust, but shall state the substance of or make reference to the provisions of Section 7.1 of the Declaration of Trust. ARTICLE 9 Issuance of Share Certificates ------------------------------ 9.1Share Certificates. In lieu of issuing certificates for shares, the ------------------- Trustees or the transfer agent may either issue receipts therefor or may keep accounts upon the books of the Trust for the record holders of such shares, who shall in either case be deemed, for all purposes hereunder, to be the holders of certificates for such shares as if they had accepted such certificates and shall be held to have expressly assented and agreed to the terms hereof. The Trustees may at any time authorize the issuance of share certificates. In that event, each shareholder shall be entitled to a certificate stating the number of shares owned by him, in such form as shall be prescribed from time to time by the Trustees. Such certificate shall be signed by the President or a Vice-President and by the Treasurer or Assistant Treasurer. Such signatures may be facsimiles if the certificate is signed by a transfer agent, or by a registrar, other than a Trustee, officer or employee of the Trust. In case any officer who has signed or whose facsimile signature has been placed on such certificate shall cease to be such officer before such certificate is issued, it may be issued by the Trust with the same effect as if he were such officer at the time of its issue. 9.2Loss of Certificates. In case of the alleged loss or destruction or the -------------------- mutilation of a share certificate, a duplicate certificate may be issued in place thereof, upon such terms as the Trustees shall prescribe. 9.3Issuance of New Certificate to Pledgee. In the event certificates have -------------------------------------- been issued, a pledgee of shares transferred as collateral security shall be entitled to a new certificate if the instrument of transfer substantially describes the debt or duty that is intended to be secured thereby. Such new certificate shall express on its face that it is held as collateral security, and the name of the pledgor shall be stated thereon, who alone shall be liable as a shareholder, and entitled to vote thereon. 9.4 Discontinuance of Issuance of Certificates. The Trustees may at any -------------------------------------------- time discontinue the issuance of share certificates and may, by written notice to each shareholder, require the surrender of share certificates to the Trust for cancellation. Such surrender and cancellation shall not affect the ownership of shares in the Trust. ARTICLE 10 Custodian --------- 10.1 General. The Trust shall at all times employ a bank or trust company ------- having a capital, surplus and undivided profits of at least Five Hundred Thousand ($500,000) Dollars as Custodian of the capital assets of the Trust. The Custodian shall be compensated for its services by the Trust and upon such basis as shall be agreed upon from time to time between the Trust and the Custodian. ARTICLE 11 Dealings with Trustees and Officers ----------------------------------- 11.1 General. Any Trustee, officer or other agent of the Trust may acquire, ------- own and dispose of shares of the Trust to the same extent as if he were not a Trustee, officer or agent; and the Trustees may 'accept subscriptions to shares or repurchase shares from any firm or company in which he is interested. ARTICLE 12 Shareholders ------------ 12.1 Meetings. A meeting of the shareholders of the Trust shall be held -------- whenever called by the Trustees, whenever election of a Trustee or Trustees by shareholders is required by the provisions of Section 16(a) of the Investment Company Act of 1940 for that purpose or whenever otherwise required pursuant to the Declaration of Trust. Any meeting shall be held on such day and at such time as the President or the Trustees may fix in the notice of the meeting. 12.2 Record Dates. For the purpose of determining the shareholders who are ------------ entitled to vote or act at any meeting or any adjournment thereof, or who are entitled to receive payment of any dividend or of any other distribution, the Trustees may from time to time fix a time, which shall be not more than 60 days before the date of any meeting of shareholders or the date for the payment of any dividend or of any other distribution, as the record date for determining the shareholders having the right to notice of and to vote at such meeting and any adjournment thereof or the right to receive such dividend or distribution, and in such case only shareholders of record on such record date shall have such right, notwithstanding any transfer of shares on the books of the Trust after the record date; or without fixing such record date the Trustees may for any such purposes close the register or transfer books for all or any part of such period. ARTICLE 13 Amendments to the By-Laws ------------------------- 13.1 General. These By-Laws may be amended or repealed, in whole or in ------- part, by a majority of the Trustees then in office at any meeting of the Trustees, or by one or more writings signed by such a majority. EX-99.D 3 ex9923di.txt APPALACHIAN ASSET MGMT AGRMT EX-99.23.d(i) TO: Appalachian Asset Management, Inc. 1018 Kanawha Blvd., East, Suite 301 Charleston, WV 25301 Dear Sirs: AmeriPrime Funds (the "Trust") herewith confirms our agreement with you. The Trust has been organized to engage in the business of an investment company. The Trust currently offers several series of shares to investors, one of which is the AAM Equity Fund (the "Fund"). You have been selected to act as the sole investment advisor of the Fund and to provide certain other services, as more fully set forth below, and you are willing to act as such investment advisor and to perform such services under the terms and conditions hereinafter set forth. Accordingly, the Trust agrees with you as follows effective upon the date of the execution of this Agreement. 1. ADVISORY SERVICES ----------------- You will regularly provide the Fund with such investment advice as you in your discretion deem advisable and will furnish a continuous investment program for the Fund consistent with the Fund's investment objectives and policies. You will determine the securities to be purchased for the Fund, the portfolio securities to be held or sold by the Fund and the portion of the Fund's assets to be held uninvested, subject always to the Fund's investment objectives, policies and restrictions, as each of the same shall be from time to time in effect, and subject further to such policies and instructions as the Board may from time to time establish. You will advise and assist the officers of the Trust in taking such steps as are necessary or appropriate to carry out the decisions of the Board and the appropriate committees of the Board regarding the conduct of the business of the Fund. 2. ALLOCATION OF CHARGES AND EXPENSES ---------------------------------- You will pay all operating expenses of the Fund, including the compensation and expenses of any employees of the Fund and of any other persons rendering any services to the Fund; clerical and shareholder service staff salaries; office space and other office expenses; fees and expenses incurred by the Fund in connection with membership in investment company organizations; legal, auditing and accounting expenses; expenses of registering shares under federal and state securities laws, excluding expenses incurred by the Fund in connection with the organization and initial registration of shares of the Fund; insurance expenses; fees and expenses of the custodian, transfer agent, dividend disbursing agent, shareholder service agent, plan agent, administrator, accounting and pricing services agent and underwriter of the Fund; expenses, including clerical expenses, of issue, sale, redemption or repurchase of shares of the Fund; the cost of preparing and distributing reports and notices to shareholders, the cost of printing or preparing prospectuses and statements of additional information for delivery to the Fund's current and prospective shareholders; the cost of printing or preparing stock certificates or any other documents, statements or reports to shareholders; expenses of shareholders' meetings and proxy solicitations; advertising, promotion and other expenses incurred directly or indirectly in connection with the sale or distribution of the Fund's shares (excluding expenses which the Fund is authorized to pay pursuant to Rule 12b-1 under the 1940 Act, as amended); and all other operating expenses not specifically assumed by the Fund. The Fund will pay all brokerage fees and commissions, taxes, borrowing costs (such as (a) interest and (b) dividend expenses on securities sold short), fees and expenses of the non-interested person trustees and such extraordinary or non-recurring expenses as may arise, including organizational expenses, and litigation to which the Fund may be a party and indemnification of the Trust's trustees and officers with respect thereto. The Fund will also pay expenses which it is authorized to pay pursuant to Rule 12b-1 under the 1940 Act. You may obtain reimbursement from the Fund, at such time or times as you may determine in your sole discretion, for any of the expenses advanced by you, which the Fund is obligated to pay, and such reimbursement shall not be considered to be part of your compensation pursuant to this Agreement. 3. COMPENSATION OF THE ADVISOR --------------------------- For all of the services to be rendered and payments to be made as provided in this Agreement, as of the last business day of each month, the Fund will pay you a fee at the annual rate of 1.15% of the average value of its daily net assets. The average value of the daily net assets of the Fund shall be determined pursuant to the applicable provisions of the Declaration of Trust of the Trust or a resolution of the Board, if required. If, pursuant to such provisions, the determination of net asset value of the Fund is suspended for any particular business day, then for the purposes of this paragraph, the value of the net assets of the Fund as last determined shall be deemed to be the value of the net assets as of the close of the business day, or as of such other time as the value of the Fund's net assets may lawfully be determined, on that day. If the determination of the net asset value of the Fund has been suspended for a period including such month, your compensation payable at the end of such month shall be computed on the basis of the value of the net assets of the Fund as last determined (whether during or prior to such month). 4. EXECUTION OF PURCHASE AND SALE ORDERS ------------------------------------- In connection with purchases or sales of portfolio securities for the account of the Fund, it is understood that you will arrange for the placing of all orders for the purchase and sale of portfolio securities for the account with brokers or dealers selected by you, subject to review of this selection by the Board from time to time. You will be responsible for the negotiation and the allocation of principal business and portfolio brokerage. In the selection of such brokers or dealers and the placing of such orders, you are directed at all times to seek for the Fund the best qualitative execution, taking into account such factors as price (including the applicable brokerage commission or dealer spread), the execution capability, financial responsibility and responsiveness of the broker or dealer and the brokerage and research services provided by the broker or dealer. You should generally seek favorable prices and commission rates that are reasonable in relation to the benefits received. In seeking best qualitative execution, you are authorized to select brokers or dealers who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934) to the Fund and/or the other accounts over which you exercise investment discretion. You are authorized to pay a broker or dealer who provides such brokerage and research services a commission for executing a Fund portfolio transaction which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if you determine in good faith that the amount of the commission is reasonable in relation to the value of the brokerage and research services provided by the executing broker or dealer. The determination may be viewed in terms of either a particular transaction or your overall responsibilities with respect to the Fund and to accounts over which you exercise investment discretion. The Fund and you understand and acknowledge that, although the information may be useful to the Fund and you, it is not possible to place a dollar value on such information. The Board shall periodically review the commissions paid by the Fund to determine if the commissions paid over representative periods of time were reasonable in relation to the benefits to the Fund. Consistent with the Rules of Fair Practice of the National Association of Securities Dealers, Inc., and subject to seeking best qualitative execution as described above, you may give consideration to sales of shares of the Fund as a factor in the selection of brokers and dealers to execute Fund portfolio transactions. Subject to the provisions of the Investment Company Act of 1940, as amended, and other applicable law, you, any of your affiliates or any affiliates of your affiliates may retain compensation in connection with effecting the Fund's portfolio transactions, including transactions effected through others. If any occasion should arise in which you give any advice to clients of yours concerning the shares of the Fund, you will act solely as investment counsel for such client and not in any way on behalf of the Fund. Your services to the Fund pursuant to this Agreement are not to be deemed to be exclusive and it is understood that you may render investment advice, management and other services to others, including other registered investment companies. 5. LIMITATION OF LIABILITY OF ADVISOR ---------------------------------- You may rely on information reasonably believed by you to be accurate and reliable. Except as may otherwise be required by the Investment Company Act of 1940 or the rules thereunder, neither you nor your shareholders, officers, directors, employees, agents, control persons or affiliates of any thereof shall be subject to any liability for, or any damages, expenses or losses incurred by the Trust in connection with, any error of judgment, mistake of law, any act or omission connected with or arising out of any services rendered under, or payments made pursuant to, this Agreement or any other matter to which this Agreement relates, except by reason of willful misfeasance, bad faith or gross negligence on the part of any such persons in the performance of your duties under this Agreement, or by reason of reckless disregard by any of such persons of your obligations and duties under this Agreement. Any person, even though also a director, officer, employee, shareholder or agent of you, who may be or become an officer, director, trustee, employee or agent of the Trust, shall be deemed, when rendering services to the Trust or acting on any business of the Trust (other than services or business in connection with your duties hereunder), to be rendering such services to or acting solely for the Trust and not as a director, officer, employee, shareholder or agent of you, or one under your control or direction, even though paid by you. 6. DURATION AND TERMINATION OF THIS AGREEMENT ------------------------------------------ This Agreement shall take effect on the date of its execution, and shall remain in force for a period of two (2) years from the date of its execution, and from year to year thereafter, subject to annual approval by (i) the Board or (ii) a vote of a majority (as defined in the Investment Company Act of 1940) of the outstanding voting securities of the Fund, provided that in either event continuance is also approved by a majority of the trustees who are not "interested persons," as defined in the Investment Company Act of 1940, of you or the Trust, by a vote cast in person at a meeting called for the purpose of voting such approval. If the shareholders of the Fund fail to approve the Agreement in the manner set forth above, upon request of the Board, you will continue to serve or act in such capacity for the Fund for the period of time pending required approval of the Agreement, of a new agreement with you or a different advisor or other definitive action; provided that the compensation to be paid by the Fund to you for your services to and payments on behalf of the Fund will be equal to the lesser of your actual costs incurred in furnishing such services and payments or the amount you would have received under this Agreement for furnishing such services and payments. This Agreement may, on sixty days written notice, be terminated with respect to the Fund, at any time without the payment of any penalty, by the Board, by a vote of a majority of the outstanding voting securities of the Fund, or by you. This Agreement shall automatically terminate in the event of its assignment. 7. USE OF NAME ----------- The Trust and you acknowledge that all rights to the name "AAM" belongs to you, and that the Trust is being granted a limited license to use such words in its Fund name or in any class name. In the event you cease to be the advisor to the Fund, the Trust's right to the use of the name "AAM" shall automatically cease on the ninetieth day following the termination of this Agreement. The right to the name may also be withdrawn by you during the term of this Agreement upon ninety (90) days' written notice by you to the Trust. Nothing contained herein shall impair or diminish in any respect, your right to use the name "AAM" in the name of, or in connection with, any other business enterprises with which you are or may become associated. There is no charge to the Trust for the right to use these names. 8. AMENDMENT OF THIS AGREEMENT --------------------------- No provision of this Agreement may be changed, waived, discharged or terminated orally, and no amendment of this Agreement shall be effective until approved by the Board, including a majority of the trustees who are not interested persons of you or of the Trust, cast in person at a meeting called for the purpose of voting on such approval, and (if required under current interpretations of the Act by the Securities and Exchange Commission) by vote of the holders of a majority of the outstanding voting securities of the series to which the amendment relates. 9. LIMITATION OF LIABILITY TO TRUST PROPERTY ----------------------------------------- The term "AmeriPrime Funds" means and refers to the Trustees from time to time serving under the Trust's Declaration of Trust as the same may subsequently thereto have been, or subsequently hereto be, amended. It is expressly agreed that the obligations of the Trust hereunder shall not be binding upon any of the trustees, shareholders, nominees, officers, agents or employees of the Trust personally, but bind only the trust property of the Trust, as provided in the Declaration of Trust of the Trust. The execution and delivery of this Agreement have been authorized by the trustees and shareholders of the Trust and signed by officers of the Trust, acting as such, and neither such authorization by such trustees and shareholders nor such execution and delivery by such officers shall be deemed to have been made by any of them individually or to impose any liability on any of them personally, but shall bind only the trust property of the Trust as provided in its Declaration of Trust. A copy of the Agreement and Declaration of Trust of the Trust is on file with the Secretary of the State of Ohio. 10. SEVERABILITY ------------ In the event any provision of this Agreement is determined to be void or unenforceable, such determination shall not affect the remainder of this Agreement, which shall continue to be in force. 11. QUESTIONS OF INTERPRETATION --------------------------- (a) This Agreement shall be governed by the laws of the State of Ohio. (b) Any question of interpretation of any term or provision of this Agreement having a counterpart in or otherwise derived from a term or provision of the Investment Company Act of 1940, as amended (the "Act") shall be resolved by reference to such term or provision of the Act and to interpretation thereof, if any, by the United States courts or in the absence of any controlling decision of any such court, by rules, regulations or orders of the Securities and Exchange Commission issued pursuant to said Act. In addition, where the effect of a requirement of the Act, reflected in any provision of this Agreement is revised by rule, regulation or order of the Securities and Exchange Commission, such provision shall be deemed to incorporate the effect of such rule, regulation or order. 12. NOTICES ------- Any notices under this Agreement shall be in writing, addressed and delivered or mailed postage paid to the other party at such address as such other party may designate for the receipt of such notice. Until further notice to the other party, it is agreed that the address of the Trust is 1725 E. Southlake Blvd., Suite 200, Southlake, Texas 76092, and your address for this purpose shall be 1018 Kanawha Blvd., East, Suite 209, Charleston, WV 25301. 13. COUNTERPARTS ------------ This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 14. BINDING EFFECT -------------- Each of the undersigned expressly warrants and represents that he has the full power and authority to sign this Agreement on behalf of the party indicated, and that his signature will operate to bind the party indicated to the foregoing terms. 15. CAPTIONS -------- The captions in this Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. If you are in agreement with the foregoing, please sign the form of acceptance on the accompanying counterpart of this letter and return such counterpart to the Trust, whereupon this letter shall become a binding contract upon the date thereof. Yours very truly AmeriPrime Funds By: /s/ Anthony J. Ghoston ------------------------------ Anthony J. Ghoston, President Dated: August 5, 2004 ACCEPTANCE ---------- The foregoing Agreement is hereby accepted. Appalachian Asset Management, Inc. By: /s/ Knox Fuqua ------------------------------- Knox Fuqua, President Dated: August 5, 2004 EX-99.H 4 ex9923h.txt MFA AGRMT EX-99.23.h MUTUAL FUND SERVICES AGREEMENT Fund Administration Services Fund Accounting Services Transfer Agency Services between AMERIPRIME FUNDS and UNIFIED FUND SERVICES, INC. July 1, 2003 Exhibit A - Portfolio Listing Exhibit B - Fund Administration Services Description Exhibit C - Fund Accounting Services Description Exhibit D - Transfer Agency Services Description Exhibit E - Fees and Expenses MUTUAL FUND SERVICES AGREEMENT AGREEMENT (this "Agreement"), dated as of July 1, 2003, between the AmeriPrime Funds, an Ohio business trust (the "Fund"), and Unified Fund Services, Inc., a Delaware corporation ("Unified"). WITNESSTH: WHEREAS, the Fund is registered as an open-end, management investment company under the Investment Company Act of 1940, as amended (the "1940 Act"); and WHEREAS, the Fund wishes to retain Unified to provide certain transfer agent, fund accounting and administration services with respect to the Fund, and Unified is willing to furnish such services; NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein, the parties hereto hereby agree as follows: SECTION 1. Appointment. The Fund hereby appoints Unified to provide ----------- transfer agent, fund accounting and fund administration services for the Fund, subject to the supervision of the Board of Trustees of the Fund (the "Board"), for the period and on the terms set forth in this Agreement. Unified accepts such appointment and agrees to furnish the services herein set forth in return for the compensation as provided in Section 6 and Exhibit E to this Agreement. The Fund will initially consist of the portfolios, funds and/or classes of shares (each a "Portfolio"; collectively the "Portfolios") listed on Exhibit A. The Fund shall notify Unified in writing of each additional Portfolio established by the Fund. Each new Portfolio shall be subject to the provisions of this Agreement, except to the extent that the provisions (including those relating to the compensation and expenses payable by the Fund and its Portfolios) may be modified with respect to each new Portfolio in writing by the Fund and Unified at the time of the addition of the new Portfolio. SECTION 2. Representations and Warranties of Unified. Unified represents ------------------------------------------ and warrants to the Fund that: (a) Unified is a corporation duly organized and existing under the laws of the State of Delaware; (b) Unified is empowered under applicable laws and by its Articles of Incorporation and By-Laws to enter into and perform this Agreement, and all requisite corporate proceedings have been taken by Unified to authorize Unified to enter into and perform this Agreement; (c) Unified has, and will continue to have, access to the facilities, personnel and equipment required to fully perform its duties and obligations hereunder; (d) no legal or administrative proceedings have been instituted or threatened against Unified that would impair its ability to perform its duties and obligations under this Agreement; and (e) Unified's entrance into this Agreement will not cause a material breach or be in material conflict with any other agreement or obligation of Unified or any law or regulation applicable to Unified. SECTION 3. Representations and Warranties of the Fund. The Fund represents ------------------------------------------ and warrants to Unified that: (a) the Fund is a business trust duly organized and existing under the laws of the State of Ohio; (b) the Fund is empowered under applicable laws and by its Declaration of Trust and By-Laws to enter into and perform this Agreement, and the Fund has taken all requisite proceedings to authorize the Fund to enter into and perform this Agreement; (c) the Fund is an investment company properly registered under the 1940 Act; a registration statement under the Securities Act of 1933, as amended ("1933 Act"), and the 1940 Act on Form N-lA has been filed and will be effective and will remain effective during the term of this Agreement, and all necessary filings under the laws of the states will have been made and will be current during the term of this Agreement; (d) no legal or administrative proceedings have been instituted or threatened against the Fund that would impair its ability to perform its duties and obligations under this Agreement; and (e) the Fund's entrance into this Agreement will not cause a material breach or be in material conflict with any other agreement or obligation of the Fund or any law or regulation applicable to it. SECTION 4. Delivery of Documents. The Fund will promptly furnish to Unified --------------------- such copies, properly certified or authenticated, of contracts, documents and other related information that Unified may request or requires to properly discharge its duties. Such documents may include, but are not limited to, the following: (a) resolutions of the Board authorizing the appointment of Unified to provide certain transfer agency, fund accounting and administration services to the Fund and approving this Agreement; (b) the Fund's Declaration of Trust; (c) the Fund's By-Laws; (d) the Fund's Notification of Registration on Form N-8A under the 1940 Act as filed with the Securities and Exchange Commission ("SEC"); (e) the Fund's registration statement including exhibits, as amended, on Form N-1A (the "Registration Statement") under the 1933 Act and the 1940 Act, as filed with the SEC; (f) copies of the Management Agreement between the Fund and its investment adviser (the "Advisory Agreement"); (g) opinions of counsel and auditors reports; (h) the Fund's Prospectus and Statement of Additional Information relating to all Portfolios and all amendments and supplements thereto (such Prospectus and Statement of Additional Information and supplements thereto, as presently in effect and as from time to time hereafter amended and supplemented, herein called the "Prospectuses"); and (i) such other agreements as the Fund may enter into from time to time including securities lending agreements, futures and commodities account agreements, brokerage agreements and options agreements. SECTION 5. Services Provided by Unified. ---------------------------- (a) Unified will provide the following services subject to the control, direction and supervision of the Board and in compliance with the objectives, policies and limitations set forth in the Fund's Registration Statement, Declaration of Trust and By-Laws; applicable laws and regulations; and all resolutions and policies implemented by the Board: Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 22 (i) Fund Administration, as described on Exhibit B to this Agreement. ------------------- (ii) Fund Accounting, as described on Exhibit C to this Agreement. --------------- (iii) Transfer Agency, as described on Exhibit D to this Agreement. --------------- (iv) Dividend Disbursing. Unified will serve as the Fund's dividend -------------------- disbursing agent. Unified will prepare and mail checks, place wire transfers of credit income and capital gain payments to shareholders. The Fund will advise Unified in advance of the declaration of any dividend or distribution and the record and payable date thereof. Unified will, on or before the payment date of any such dividend or distribution, notify the Fund's Custodian of the estimated amount required to pay any portion of such dividend or distribution payable in cash, and on or before the payment date of such distribution, the Fund will instruct its Custodian to make available to Unified sufficient funds for the cash amount to be paid out. If a shareholder is entitled to receive additional shares by virtue of any such distribution or dividend, appropriate credits will be made to each shareholder's account and/or certificates delivered where requested. A shareholder not receiving certificates will receive a confirmation from Unified indicating the number of shares credited to his/her account. (b) Unified will also: (i) provide office facilities with respect to the provision of the services contemplated herein (which may be in the offices of Unified or a corporate affiliate of Unified); (ii) provide or otherwise obtain personnel sufficient, in Unified's sole discretion, for provision of the services contemplated herein; (iii) furnish equipment and other materials, which Unified, in its sole discretion, believes are necessary or desirable for provision of the services contemplated herein; and (iv) keep records relating to the services provided hereunder in such form and manner as set forth on Exhibits B, C and D and as Unified may -------------------- otherwise deem appropriate or advisable, all in accordance with the 1940 Act. To the extent required by Section 31 of the 1940 Act and the rules thereunder, Unified agrees that all such records prepared or maintained by Unified relating to the services provided hereunder are the property of the Fund and will be preserved for the periods prescribed under Rule 31a-2 under the 1940 Act, maintained at the Fund's expense, and made available to the SEC for inspection in accordance with such Section and rules. Subject to the provisions of Section 9 hereof, Unified further agrees to surrender promptly to the Fund upon its request and cease to retain in its records and files those records and documents created and maintained by Unified pursuant to this Agreement. SECTION 6. Fees: Expenses: Expense Reimbursement. ------------------------------------- (a) As compensation for the services rendered to the Fund pursuant to this Agreement the Fund shall pay Unified on a monthly basis those fees determined as set forth on Exhibit E to this Agreement. Such fees are to be billed monthly and --------- shall be due and payable upon receipt of the invoice. Upon any termination of this Agreement and before the end of any month, the fee for the part of the month before such termination shall be equal to the fee normally due for the full monthly period and shall be payable, without setoff, upon the date of termination of this Agreement. (b) For the purpose of determining fees calculated as a function of a Portfolio's net assets, the value of the Portfolio's net assets shall be computed as required by the Prospectus, generally accepted accounting principles and resolutions of the Board. Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 23 (c) Unified will from time to time employ or associate with such person or persons as may be appropriate to assist Unified in the performance of this Agreement. Such person or persons may be officers and employees who are employed or designated as officers by both Unified and the Fund. Except as otherwise expressly provided in this Agreement, the compensation of such person or persons for such employment shall be paid by Unified and no obligation will be incurred by or on behalf of the Fund in such respect. (d) Unified will bear all of its own expenses in connection with the performance of the services under this Agreement, except as otherwise expressly provided in this Agreement. The Fund agrees to promptly reimburse Unified for any equipment and supplies specially ordered by or for the Fund through Unified and for any other expenses not contemplated by this Agreement that Unified may incur on the Fund's behalf, at the Fund's request or as consented to by the Fund. Such other expenses to be incurred in the operation of the Fund and to be borne by the Fund, include, but are not limited to: taxes; interest; brokerage fees and commissions; salaries and fees of officers and directors who are not officers, directors, shareholders or employees of Unified or Unified's affiliates; SEC and state Blue Sky registration and qualification fees, levies, fines and other charges; advisory fees; charges and expenses of custodians; insurance premiums including fidelity bond premiums; auditing and legal expenses; costs of maintenance of corporate existence; expenses of typesetting and printing of prospectuses and for distribution to current shareholders of the Fund; expenses of printing and production cost of shareholders' reports and proxy statements and materials; costs and expense of Fund stationery and forms; costs and expenses of special telephone and data lines and devices; costs associated with corporate, shareholder and Board meetings; and any extraordinary expenses and other customary Fund expenses. In addition, Unified may utilize one or more independent pricing services, approved from time to time by the Board, to obtain securities prices and to act as backup to the primary pricing services, in connection with determining the net asset values of the Fund, and the Fund will reimburse Unified for the Fund's share of the cost of such services based upon the actual usage, or a pro-rata estimate of the use, of the services for the benefit of the Fund. (e) The Fund may request additional services, additional processing or special reports. Such requests may be provided by Unified at additional charges. In this event, the Fund shall submit such requests in writing together with such specifications as may be reasonably required by Unified, and Unified shall respond to such requests in the form of a price quotation. The Fund's written acceptance of the quotation must be received prior to implementation of such request. Additional services will be charged at Unified's standard rates. (f) All fees, out-of-pocket expenses or additional charges of Unified shall be billed on a monthly basis and shall be due and payable upon receipt of the invoice. No fees, out-of-pocket expenses or other charges set forth in this Agreement shall be subject to setoff. Unified will render, after the close of each month in which services have been furnished, a statement reflecting all of the charges for such month. Charges remaining unpaid after thirty (30) days shall bear interest in finance charges equivalent to, in the aggregate, the Prime Rate (as publicly announced by Firstar Bank, N.A., from time to time) plus 2.00% per year and all costs and expenses of effecting collection of any such sums, including reasonable attorney's fees, shall be paid by the Fund to Unified. In the event that the Fund is more than sixty (60) days delinquent in its payments of monthly billings in connection with this Agreement (with the exception of specific amounts which may be contested in good faith by the Fund), this Agreement may be terminated upon thirty (30) days' written notice to the Fund by Unified. The Fund must notify Unified in writing of any contested amounts within thirty (30) days of receipt of a billing for such amounts. Disputed amounts are not due and payable while they are being investigated. SECTION 7. Proprietary and Confidential Information. Unified agrees on ------------------------------------------- behalf of itself and its employees to treat confidentially and as proprietary information of the Fund, all records and other information relative to the Fund's prior, present or potential shareholders, and to not use such records and information for any Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 24 purpose other than performance of Unified's responsibilities and duties hereunder. Unified may seek a waiver of such confidentiality provisions by furnishing reasonable prior notice to the Fund and obtaining approval in writing from the Fund, which approval shall not be unreasonably withheld and may not be withheld where the service agent may be exposed to civil or criminal contempt proceedings for failure to comply, when requested to divulge such information by duly constituted authorities. Waivers of confidentiality are automatically effective without further action by Unified with respect to Internal Revenue Service levies, subpoenas and similar actions, or with respect to any request by the Fund. SECTION 8. Duties, Responsibilities and Limitations of Liability. ----------------------------------------------------- (a) In the performance of its duties hereunder, Unified shall be obligated to exercise due care and diligence, and to act in good faith in performing the services provided for under this Agreement. In performing its services hereunder, Unified shall be entitled to rely on any oral or written instructions, advice, notices or other communications, information, records and documents (collectively, "Fund Information") from the Fund, its custodian, officers and trustees, investors, agents, legal counsel, auditor and other service providers (excluding in each case, Unified and its affiliates) (the Fund, collectively with such persons other than Unified and its affiliates, "Fund Representatives") which Unified reasonably believes to be genuine, valid and authorized. Unified also shall be entitled to consult with and rely on the advice and opinions of the Fund's auditor and of outside legal counsel retained by the Fund, as may be reasonably necessary or appropriate in Unified's sole judgment, as well as all other Fund Representatives, in each case at the expense of the Fund. (b) Neither Unified nor its officers, directors, partners, employees, shareholders or agents (the "Unified Parties") shall be liable for any error of judgment or mistake of law or for any losses, damages, costs, reasonable attorneys' fees and expenses, payments, expenses and liabilities of any nature or kind (collectively, "Damages") suffered by the Fund or its shareholders in connection with any matter to which this Agreement relates or in connection with any action (or omission) by any of the Unified Parties in connection with this Agreement. This complete release from all liability shall not apply to any action (or omission) of any Unified Party to the extent such action (or omission) is caused by or results from the negligence or willful misfeasance of any Unified Party. Any person, even though also an officer, director, partner, employee or agent of Unified, who may be or become an officer, director, partner, employee or agent of the Fund, shall be deemed when rendering services to the Fund or acting on any business of the Fund (other than services or business in connection with Unified's duties hereunder) to be rendering such services to or acting solely for the Fund and not as an officer, director, partner, employee or agent or person under the control or direction of Unified even though paid by Unified. (c) The Unified Parties shall not be responsible for, and the Fund shall indemnify and hold the Unified Parties harmless from and against, any and all Damages arising out of or in connection with: (i) any action (or omission) of any Unified Party taken pursuant to this Agreement, except to the extent (and only to the extent) any such action (or omission) is caused by or results from the negligence or willful misfeasance of any Unified Party; provided, however, that every action (or omission) taken in good faith by any of the Unified Parties in connection with or in reliance upon matters described in clauses (ii) through (x) below shall be deemed in its entirety to be an action taken pursuant to this Agreement that was not caused by and did not result from the negligence or willful misfeasance of any Unified Party; (ii) the reliance on or use by the Unified Parties of Fund Information which is furnished to any of the Unified Parties by or on behalf of any of the Fund Representatives; (iii) any delays, inaccuracies, errors or omissions in or arising out of or attributable to Fund Information which is furnished to any of the Unified Parties by or on behalf of any of the Fund Representatives or to the untimely provision to Unified of such Fund Information; Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 25 (iv) the Fund's refusal or failure to comply with the terms of this Agreement or the Fund's lack of good faith, or its actions (or omissions) involving negligence or willful misfeasance; (v) the breach of any representation or warranty of the Fund hereunder; (vi) the taping or other form of recording of telephone conversations or other forms of electronic communications with investors and shareholders, or reliance by Unified on telephone or other electronic instructions of any person acting on behalf of a shareholder or shareholder account for which telephone or other electronic services have been authorized; (vii) the reliance on or the carrying out by Unified or its officers or agents of any proper instructions reasonably believed to be duly authorized, or requests of the Fund or recognition by Unified of any share certificates which are reasonably believed to bear the proper signatures of the officers of the Fund and the proper countersignature of any transfer agent or registrar of the Fund; (viii) any delays, inaccuracy, errors or omissions in or arising out of or attributable to data or information provided to Unified by data and pricing services; (ix) the offer or sale of shares by the Fund in violation of any requirement under the federal securities laws or regulations or the securities laws or regulations of any state, or in violation of any stop order or other determination or ruling by any federal agency or any state agency with respect to the offer or sale of such shares in such state (1) resulting from activities, actions or omissions by Fund Representatives, or (2) existing or arising out of activities, actions or omissions by or on behalf of the Fund Representatives prior to the earlier of (x) the effective date of this Agreement and (y) the effective date of an agreement between the parties hereto with respect to the subject matter hereof that was in effect immediately prior to the effective date of this Agreement ; and (x) the compliance by the Fund, its investment adviser and/or its distributor with applicable securities, tax, commodities and other laws, rules and regulations. (d) In any case in which the Fund may be asked to indemnify or hold a Unified Party harmless, the Unified Party will notify the Fund promptly after identifying any situation which it believes presents or appears likely to present a claim for indemnification against the Indemnifying Party and shall keep the Fund advised with respect to all developments concerning such situation; provided, however, that the failure to do so shall not prevent recovery by the Unified Party unless such failure causes actual material harm to the Fund. The Fund shall have the option to defend the Unified Party against any claim which may be the subject of this indemnification, and, in the event that the Fund so elects, such defense shall be conducted by counsel chosen by the Fund and satisfactory to the Unified Party, and thereupon the Fund shall take over complete defense of the claim and the Unified Party shall sustain no further legal or other expenses in respect of such claim. The Unified Party will not confess any claim or make any compromise in any case in which the Fund Party will be asked to provide indemnification, except with the Fund's prior written consent. (e) Each of the Unified Parties, on the one hand, and the Fund, on the other hand, shall have the duty to mitigate Damages for which the other party may become responsible. This duty shall include giving such other party every reasonable opportunity to correct any error or other circumstance that caused, resulted in or increased such Damages, and every reasonable opportunity to assist in such mitigation. Notwithstanding any other provision of this Agreement, as to any matter where any portion of Damages may be, in whole or part, caused, increased or determined by the manner in which an item or amount is treated or reported for accounting purposes or the manner in which an item or amount is treated or reported to any governmental agency or taxing authority, no recovery for any amount of Damages in connection with such matter shall be had by any party to (or beneficiary of) this Agreement if an alternative manner of treatment or reporting is or was possible and such alternative manner of Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 26 treatment or reporting is or was, in the written opinion of any reputable practitioner of appropriate expertise, more likely than not the correct treatment (such opinion to be rendered in customary form, subject to customary assumptions and representations); provided however, that the provisions of this sentence shall not apply and shall be disregarded in respect of a matter if and only if (i) the person seeking or who may have sought to recover Damages (the "Damaged Party") provided the party against whom recovery is or may have been sought (the "Potentially Responsible Party") written notice bearing the bold heading "Notice of Potential Claim for Damages," identifying this Agreement, and describing the nature of the potential claim and the subject matter of the required opinion, (ii) such notice is sent by certified mail and actually delivered to the Potentially Responsible Party at least sixty (60) days prior to the first time such item or amount is to be accounted for or reported, (iii) the Damaged Party fully and promptly cooperates in the attempts of the Potentially Responsible Party to obtain such an opinion, and (iv) no such opinion is obtained prior to such accounting or reporting. If an opinion described in the preceding sentence is obtained by the Potentially Responsible Party, the Damaged Party shall bear the cost of such opinion. The parties acknowledge that the purpose of the preceding two sentences is to preclude the recovery of any and all Damages in connection with any matter where the proper accounting, tax or other treatment of such matter is susceptible to differing opinions among reputable practitioners of appropriate expertise, and that the effect of such sentences is intended to ensure that such matters are treated and reported in a legitimate manner that gives rise to the smallest amount of Damages. (f) THIS IS A SERVICE AGREEMENT. EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, UNIFIED DISCLAIMS ALL OTHER REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, MADE TO THE FUND OR ANY OTHER PERSON, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES REGARDING QUALITY, SUITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE (IRRESPECTIVE OF ANY COURSE OF DEALING, CUSTOM OR USAGE OF TRADE) OF ANY SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO SERVICES PROVIDED UNDER THIS AGREEMENT. UNIFIED DISCLAIMS ANY WARRANTY OF TITLE OR NON-INFRINGEMENT EXCEPT AS OTHERWISE SET FORTH IN THIS AGREEMENT. THE PARTIES ACKNOWLEDGE THAT THE ALLOCATION OF RISKS (BOTH INSURABLE RISKS AND OTHER RISKS) UNDER THIS AGREEMENT HAS BEEN TAKEN INTO ACCOUNT IN THE PRICING STRUCTURE OF THE SERVICES AND GOODS PROVIDED AND IS FAIR TO ALL PARTIES, AND THE PARTIES FURTHER ACKNOWLEDGE THAT DIFFERENT ALLOCATIONS OF RISK WERE AVAILABLE UNDER DIFFERENT PRICE STRUCTURES. The RIGHTS AND obligations of the parties (AND INTENDED BENEFICIARIES) under this Section 8 shall survive the termination of this Agreement. SECTION 9. Term. This Agreement shall become effective on the date first ---- herein above written. This Agreement may be modified or amended from time to time by mutual agreement between the parties hereto. This Agreement shall continue in effect unless terminated by either party on at least ninety (90) days' prior written notice. With the sole exception of the 30-day termination described in Section 6(f), no other event (including any purported or actual breach) shall result in termination of this Agreement. Upon termination of this Agreement, the Fund shall pay to Unified all fees, compensation and other charges as shall be accrued or due under the terms of this Agreement as of the date of termination or the date that the provision of services ceases, whichever is sooner. Should the Fund exercise its right to terminate this Agreement, the Fund agrees to pay a termination/conversion fee, simultaneous with the transfer of all Fund records to the successor mutual fund service provider(s), in an amount equal to the total compensation under this agreement for the 120-day period immediately preceding the termination notice date. Such fee shall not be subject to any setoffs of any nature. In addition, the Fund agrees to pay for all conversion tape set-up fees, test conversion preparation and processing fees and final conversion fees, none of which shall be subject to any setoff. Such compensation to Unified shall be for the expenses incurred in connection with the retrieval, compilation and movement of books, records and materials relative to the deconversion or Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 27 conversion of Fund records to the successor mutual fund service provider as directed by the Fund. Notwithstanding the foregoing, any amount owed by the Fund to Unified prior to the termination/conversion shall still be due and payable under the terms of this Agreement. No such compensation shall be due to Unified if Unified terminates this Agreement for reasons other than a default by the Fund. Upon the termination of the Agreement for any reason and payment of the fees set forth in this Agreement without setoff, Unified agrees to provide the Fund with the complete transfer agency, fund accounting and administration records in its possession and to assist the Fund in the orderly transfer of accounts and records. Without limiting the generality of the foregoing, subject to the preceding sentence, Unified agrees upon termination of this Agreement: (a) to deliver to the successor mutual fund service provider(s), computer tapes containing the Fund's accounts and records together with such record layouts and additional information as may be necessary to enable the successor mutual fund service provider(s) to utilize the information therein; (b) to cooperate with the successor mutual fund service provider(s) in the interpretation of the Fund's account and records; (c) to forward all shareholder calls, mail and correspondence to the new mutual fund service provider(s) upon de-conversion; and (d) to act in good faith, to make the conversion as smooth as possible for the successor mutual fund service provider(s) and the Fund. SECTION 10. Notices. Any notice required or permitted hereunder shall be in ------- writing and shall be deemed to have been given when delivered in person or by certified mail, return receipt requested, to the parties at the following address (or such other address as a party may specify by notice to the other): (a) If to the Fund, to: AmeriPrime Funds 431 N. Pennsylvania Street Indianapolis, Indiana 46204 Attention: President (b) If to Unified, to: Unified Fund Services, Inc. 431 North Pennsylvania Street Indianapolis, Indiana 46204 Attention: President Notice shall be effective upon receipt if by mail, on the date of personal delivery (by private messenger, courier service or otherwise) or upon confirmed receipt of telex or facsimile, whichever occurs first. SECTION 11. Assignability. This Agreement may not be assigned or otherwise ------------- transferred by either party hereto, without the prior written consent of the other party, which consent shall not be unreasonably withheld; provided, however, that Unified may, in its sole discretion and upon notice to the Fund, assign all its right, title and interest in this Agreement to an affiliate, parent or subsidiary, or to the purchaser of substantially all of its business. Unified may, in its sole discretion, engage subcontractors to perform any of the obligations contained in this Agreement to be performed by Unified provided that Unified shall remain responsible to the Fund for the actions and omissions of such subcontractors as if Unified had provided such services to the Fund. Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 28 SECTION 12. Intended Beneficiaries. This Agreement shall be binding upon ----------------------- the Fund, Unified and their respective successors and assigns, and shall inure to the benefit of the Fund, Unified, the Unified Parties, their respective heirs, successors and assigns. Nothing herein expressed or implied is intended to confer upon any person not named or described in the preceding sentence any rights, remedies, obligations or liabilities under or by reason of this Agreement. Section 13. Arbitration. Notwithstanding any provision of this Agreement to ----------- the contrary, any claim or controversy arising out of or in any manner relating to this Agreement, or breach hereof, which cannot be resolved between the parties themselves, shall be settled by arbitration administered by the American Arbitration Association in Indianapolis, Indiana in accordance with its applicable rules. The arbitration panel shall consist of three arbitrators selected from list(s) of candidates provided by the American Arbitration Association. One party to the dispute shall be entitled to appoint one arbitrator and the other party to the dispute shall be entitled to appoint one arbitrator. The third arbitrator, who shall be an attorney in good standing who is licensed to practice law in the State of Indiana and devotes more than one-half of his or her professional time to the practice of securities law, shall be chosen by the two arbitrators so appointed. If any party fails to appoint its arbitrator or to notify the other party of such appointment within thirty (30) days after the institution of arbitration proceedings, such other party may request the President of the American Arbitration Association to appoint such arbitrator on behalf of the party who so failed. If the two arbitrators appointed by (or on behalf of) the parties fail to appoint such third arbitrator, or fail to notify the parties to such proceedings of such appointment, within thirty (30) days after the appointment of the later of such two arbitrators to be appointed by (or on behalf of) the parties, any party may request such President to appoint such third arbitrator. The President of the American Arbitration Association shall appoint such arbitrator or such third arbitrator, as the case may be, within thirty (30) days after the making of such request. No awards of punitive damages shall be made. The parties hereby agree that judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction. The parties acknowledge and agree that the performance of the obligations under this Agreement necessitates the use of instrumentalities of interstate commerce and, notwithstanding other general choice of law provisions in this Agreement, the parties agree that the Federal Arbitration Act shall govern and control with respect to the provisions of this Section 13. SECTION 14. Waiver. The failure of a party to insist upon strict adherence ------ to any term of this Agreement on any occasion shall not be considered a waiver nor shall it deprive such party of the right thereafter to insist upon strict adherence to that term or any term of this Agreement. Any waiver must be in writing signed by the waiving party. SECTION 15. Force Majeure. Unified shall not be responsible or liable for -------------- any failure or delay in performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its control, including without limitation, acts of God, earthquake, fires, floods, wars, acts of civil or military authorities, governmental actions, nonperformance by a third party or any similar cause beyond the reasonable control of Unified, failures or fluctuations in telecommunications or other equipment, nor shall any such failure or delay give the Fund the right to terminate this Agreement. SECTION 16. Use of Name. The Fund and Unified agree not to use the other's ----------- name nor the names of such other's affiliates, designees, or assignees in any prospectus, sales literature, or other printed material written in a manner not previously, expressly approved in writing by the other or such other's affiliates, designees, or assignees except where required by the SEC or any state agency responsible for securities regulation. SECTION 17. Amendments. This Agreement may be modified or amended from time ---------- to time by mutual written agreement between the parties. No provision of this Agreement may be changed, discharged or terminated orally, but only by an instrument in writing signed by the party against which enforcement of the change, discharge or termination is sought. SECTION 18. Severability. Whenever possible, each provision of this ------------ Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law to any person or circumstance, such provision shall be ineffective only to the extent of such prohibition or invalidity. In the event that any one or more of the provisions contained in this Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 29 Agreement or any application thereof shall be invalid, illegal or unenforceable in any respect, the validity, legality or enforceability of the remaining provisions of this Agreement and any other application thereof shall not in any way be affected or impaired thereby. SECTION 19. Headings; Pronouns; Certain Phrases. The headings in the -------------------------------------- sections and subsections of this Agreement are inserted for convenience only and in no way alter, amend, modify, limit or restrict the contractual obligations of the parties. Wherever used in this Agreement, masculine, feminine and neuter pronouns shall be deemed to include the other genders. Singular pronouns and nouns (including defined terms) shall be deemed to include the plural (and vice versa) as the context may require, but shall have no effect upon the nature of a party's liability as joint or several. Wherever used in this Agreement, the phrase "in connection with" shall be given the broadest possible interpretation, and shall include matters (without limitation) that are in whole or part caused by, relate to, arise out of, are attributable to, or result from, the referent or object of such phrase. SECTION 20. No Strict Construction. The language used in this Agreement ----------------------- shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any party. SECTION 21. Entire Agreement; Survival; Governing Law. This Agreement --------------------------------------------- embodies the entire understanding between the parties with respect to the subject matter hereof, and supersedes all prior negotiations and agreements between the parties relating to the subject matter hereof; provided, however, that if an agreement between the parties hereto with respect to the subject matter hereof was in effect immediately prior to the effective date of this Agreement (the "Predecessor Agreement"), then the provisions contained in Section 8 of the Predecessor Agreement (relating to indemnification and other risk allocation matters) shall, in respect of all periods prior to the effective date of this Agreement ("Prior Periods"), survive and remain in effect to the same extent and in the same manner as such provisions would have applied in respect of Prior Periods had the Predecessor Agreement not been superseded by this Agreement or otherwise terminated or amended or modified in any manner at any time. The provisions of Section 6 through 9 and Sections 13 through 21, inclusive, shall survive any termination of this Agreement. This Agreement shall be governed by and construed and interpreted according to the internal laws of the State of Indiana, without reference to conflict of law principles. [Signature Page Follows] Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 30 IN WITNESS WHEREOF, the parties hereto have caused this Mutual Fund Services Agreement to be signed by their respective duly authorized officers as of the day and year first above written. AMERIPRIME FUNDS By: /s/ Thomas G. Napurano Date 7/1/03 Print Name: Thomas G. Napurano Title: Treasurer Attest: /s/ Linda A. Lawson UNIFIED FUND SERVICES, INC. By: /s/ David A. Bogaert Date 6/18/03 Print Name: David A. Bogaert Title: Managing Director By: /s/ William H. Young Date 7/1/03 Print Name: William H. Young Title: CEO Attest: /s/ Linda A. Lawson Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 31 EXHIBIT A to Mutual Fund Services Agreement List of Portfolios ------------------ Portfolios serviced by Unified are as agreed to from time to time between Unified and AmeriPrime. Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 32 EXHIBIT B to Mutual Fund Services Agreement General Description of Fund Administration Services --------------------------------------------------- Unified shall provide the following administration services to the fund: I. FINANCIAL AND TAX REPORTING A. Prepare agreed upon management reports and Board of Trustees materials such as unaudited financial statements, distribution summaries, and deviations of mark-to-market valuation and the amortized cost for money market funds. B. Calculate and Report Fund performance to outside services as directed by fund management. C. Prepare and file Fund's Form N-SAR with the SEC. D. Prepare and coordinate the printing of fund's Semiannual and Annual Reports to Shareholders. E. In conjunction with transfer agent, notify shareholders as to what portion, if any, of the distributions made by the Fund's during the prior fiscal year were exempt-interest dividends under Section 852(b)(5)(A) of the Code. F. Provide financial information for Fund proxy statements and Prospectuses. II. PORTFOLIO COMPLIANCE A. Assist with monitoring each portfolio's compliance with investment restrictions (e.g., issuer or industry diversification, etc.) listed in the current Prospectus and Statement of Additional Information. B. Assist with monitoring each portfolio's compliance with the requirements of Section 851 of the Code for qualification as a RIC (i.e., 90% Income, and Diversification Tests). C. Assist with monitoring investment manager's compliance with Board directives such as "Approved Issuers Listings for Repurchase Agreements", Rule 17a-7, and Rule 12d-3 procedures. D. Administer compliance by the fund's trustees, officers and "access persons" under the terms of the fund's Code of Ethics and SEC regulations. III. REGULATORY AFFAIRS AND CORPORATE GOVERNANCE A. Assist fund counsel in the preparation and filing of post-effective amendments to the fund's registration statement on Form N-lA and supplements as needed. B. Administer shareholder meetings, and assist fund counsel in the preparation and filing of proxy materials. C. Prepare and file Rule 24f-2 notices. Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 33 D. Prepare and file all state notifications of intent to sell the fund's securities including annual renewals, adding new portfolios, preparing and filing sales reports, filing copies of the registration statement and final prospectus and statement of additional information, and increasing registered amounts of securities in individual states. E. Prepare Board materials for all Board meetings. F. Assist with the review and monitoring of fidelity bond and errors and omissions insurance coverage and make any related regulatory filings. G. Prepare and update documents such as charter document, By-Laws, foreign qualification filings. H. Assist in identifying and monitoring pertinent regulatory and legislative developments which may affect the fund and, in response to the results of such monitoring, coordinate and provide support to the fund and the fund's investment adviser with respect to those developments and results, including support with respect to routine regulatory examinations or investigations of the fund, and with respect to such matters, to work in conjunction with outside counsel, auditors and other professional organizations engaged by the fund. I. File copies of financial reports to shareholders with the SEC under Rule 30b2-1. IV. GENERAL ADMINISTRATION A. For new portfolios obtain Employer Identification Number and CUSIP numbers. Estimate organizational costs and expenses and monitor against actual disbursements. B. Coordinate all communications and data collection with regard to any regulatory examinations and yearly audits by independent accountants. C. Establish and monitor expense budgets and accruals. Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 34 EXHIBIT C to Mutual Fund Services Agreement General Description of Fund Accounting Services ----------------------------------------------- Unified shall provide the following accounting services to the fund: I. General Description A. Maintain the books and records and accounting controls for the fund's assets, including records of all securities transactions and payments of fund expenses. B. Calculate each Portfolio's net asset value in accordance with the Prospectus and (once the Portfolio meets eligibility requirements) transmit to NASDAQ and to such other entities as directed by the fund. C. Provide the Administrator with the requested reports and information deemed necessary to calculate dividend and capital gain distributions in accordance with distribution policies detailed in the fund's prospectus. Assist, if requested, the fund management in making final determinations of distribution amounts. D. Assist the fund's public accountants or other professionals in the preparation and filing of the fund's Federal tax return on Form 1120-RIC along with all state and local tax returns where applicable. Assist in the preparation and filing of the Federal Excise Tax Return (Form 8613). E. Account for dividends, interest and corporate actions received by the fund. F. Assist the Administrator in the preparation of Fund expense projections and establishing accruals. G. Produce transaction data, financial reports and such other periodic and special reports as the Board may reasonably request. H. Liaison with the fund's independent auditors. I. Monitor and administer arrangements with the fund's custodian and depository banks. Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 35 EXHIBIT D to Mutual Fund Services Agreement General Description of Transfer Agency Services ----------------------------------------------- Unified shall provide the following transfer agency services to the fund: I. GENERAL DESCRIPTION A. Systems: Utilizing PowerAgent by Envision Financial Systems, Windows NT Servers and Microsoft SQL Databases, we offer a robust yet open architecture for shareholder data. B. Interactive Voice Response: Provides funds with the opportunity to offer their shareholders 24 hour, 7 day a week access to their account information, accessing the system either via telephone or computer. C. Shareholder Services: Shareholder telephone calls can be answered by Unified's shareholder services department through 800 numbers that are unique to each fund family. Phone volumes and response times are continually monitored for quality assurance. D. Shareholder Recordkeeping: Maintains complete shareholder records for each fund including the following: (i) name, address and tax identification number; (ii) number of shares held; (iii) historical information including dividends paid and individual purchases and redemptions; and (iv) any systematic purchase or redemption instructions and correspondence relating to the current maintenance of the account. E. Purchase and Redemption Orders: Unified will process all purchase and redemption orders of a fund's shareholders in accordance with the fund's current prospectus. Confirmation statements are produced for each transaction and promptly mailed to shareholders. Daily transaction reports and share proofs are made available to all necessary parties via electronic medium. F. Telephone Orders: Process redemption, exchange and transfer requests upon telephone instructions from qualified shareholders. Unified will redeem and/or transfer fund shares from any account for which such services have been properly authorized. G. Shareholder Communications and Meetings: Mail all necessary communications by a fund to its shareholders. For proxies, Unified will handle mailing of proxy materials, tabulation of proxy cards, and provide periodic reports to the fund on the progress of the tabulation. H. Shareholder Correspondence: Acknowledge all correspondence from shareholders relating to their share accounts and undertake such other shareholder correspondence as may from time to time be mutually agreed upon. I. Asset Allocation Program Support: Provide rebalancing, asset allocation models and performance measurement as an optional and additional transfer agency service, for certain types of asset allocation and/or wrap programs. Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 37 EXHIBIT E to Mutual Fund Services Agreement TRANSFER AGENCY FEE SCHEDULE I NEW FUND START-UP/EXISTING FUND CONVERSION FEE - ---------------------------------------------------------------------------------------------------------------------- o New fund establishment; manual conversion - $1,000 or less per portfolio. o Electronic conversion - $1.50 per shareholder account with $4,000 minimum fee per trust. II STANDARD BASE FEES FOR STANDARD BASE SERVICES - ---------------------------------------------------------------------------------------------------------------------- The Base Fee1 is $18.00 for money market funds and $15.00 for equity/bond funds per active Shareholder Account per year with a minimum fee of $15,0002 per initial portfolio and/or share class per year plus $9,0002 per year for each additional share class. An Active Shareholder Account is any Shareholder Account existing on Transfer Agent's computerized files with a non-zero Share balance. There is a $.50 per account charge for any account with a zero share balance for the current month, as determined on the last day of each month. The base fee will be billed on a monthly basis. 1 The Base Fee does not include: forms design and printing, statement production, envelope design and printing, postage and handling, shipping, statement microfiche copies and 800 number access to Unified's shareholder services group. 2 Discount based on average net assets per portfolio and/or share class per month: $0 - 5 Million 25% $5 - 10 Million 10% $10 Plus Million 0% Unified will provide lost account search services in connection of SEC Rules 17Ad-17 and 17a-24 at a cost of $2.50 per account searched. These "Electronic Data Search Services" will be performed on a semi-annual basis. This service will apply to only Active Shareholder Accounts maintained on the transfer agency system coded as RPO accounts. In addition to the above fees, there will be a $200.00 per day minimum fee/rerun charge when the nightly processing has to be repeated due to incorrect NAV or dividend information received from the Portfolio Pricing Agent due to incorrect or untimely information provided by an Advisor or its Agent. III STANDARD SERVICES PROVIDED - ---------------------------------------------------------------------------------------------------------------------- o Open new accounts o Maintain Shareholder accounts, including: o Maintain certificate records o Change addresses o Prepare daily reports on number of Shares, accounts o Prepare Shareholder federal tax information o Withhold taxes on U.S. resident and non-resident alien accounts o Reply to Shareholder calls and correspondence other than that for Fund information and related inquiries o Process purchase of Shares o Issue/Cancel certificates (Excessive use may be subject to additional charges) o Process partial and complete redemptions
Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 37 III STANDARD SERVICES PROVIDED (CONTINUED) - ---------------------------------------------------------------------------------------------------------------------- o Process regular and legal transfer of accounts o Mail semi-annual and annual reports o Process dividends and distributions o Prepare Shareholder meeting lists o Confirm all transactions as provided by the terms of each Shareholder's account o Provide a system which will enable Fund to monitor the total number of Shares sold in each state. System has capability to halt sales and warn of potential oversell. (Blue Sky Reports) o Determine/Identify lost Shareholder accounts IV STANDARD REPORTS AVAILABLE - ---------------------------------------------------------------------------------------------------------------------- o 12b-1 Disbursement Report o Holdings by Account Type o 12b-1 Disbursement Summary o Posting Details o Dealer Commission Report o Posting Summary o Dealer Commission Summary Report o Settlement Summary o Exchange Activity Report o Tax Register o Fees Paid Summary Report o Transactions Journal o Fund Accrual Details V NSCC INTERFACES - ---------------------------------------------------------------------------------------------------------------------- o Fund/Serv and/or Networking set-up - $1,000 per occurrence o Fund/Serv processing - $250 per month per trust o Networking processing - $250 per month per trust o Fund/Serv transactions - $0.35 per trade o Direct Networking expenses: o Monthly dividend fund - $0.025 per item o Non-monthly dividend fund - $0.015 per item VI ADDITIONAL FEES FOR SERVICES OUTSIDE THE STANDARD BASE - ---------------------------------------------------------------------------------------------------------------------- o Interactive Voice Response System Set-up - Pass through o Archiving of old records/storage of aged records - Pass through o Off-line Shareholder research - $25 per hour (Billed to customer account) o Check copies - $3 each (Billed to customer account) o Statement copies - $5 each (Billed to customer account) o Mutual Fund fulfillment/prospect file - $1.00 per item maintenance o Shareholder communications charges (Faxes) - Pass through o Leased line/equipment on TA's computer system - Pass through o Dial-up access to TA's computer system - Pass through o Labels - $.05 each ($100 minimum) o AD-HOC REPORTWRITER Report Generation - $50.00 per report o Bank Reconciliation Service - $50.00 monthly maintenance fee per bank account - $1.50 per bank item o Systems Programming Labor Charges: o Programmers or Consultants - $125.00 per hour o Officers - $150.00 per hour o Proxy Processing - Negotiable
Unified Fund Services, Inc. 5/29/03 AmeriPrime Funds - 38 FUND ACCOUNTING FEE SCHEDULE I STANDARD FEE* - ---------------------------------------------------------------------------------------------------------------------- 0.05% for the first $50 million in average net assets per portfolio and/or share class per year; 0.04% from $50 million to $100 million in average net assets per portfolio and/or share class per year; 0.03% from $100 million to $150 million in average net assets per portfolio and/or share class per year; 0.02% over $150 million in average net assets per portfolio and/or share class per year. *Subject to a $20,0001 annual minimum per portfolio (one share class) plus $7,5001 per additional share class for Domestic Funds and a $30,0001 annual minimum per portfolio (one share class) plus $7,5001 per additional share class for International/Global Funds. Fees are billed on a monthly basis. 1 Discount based on average net assets per portfolio and/or share class per month: $0 - 5 Million 25% $5 - 10 Million 10% $10 Million Plus 0% Out of Pocket Fees: Fees charged for outside pricing services and all accompanying administrative expenditures. II STANDARD REPORTS AVAILABLE - ----------------------------------------------------------------------------------------------------------------------
Daily Reports A. General Ledger Reports 1. Trial Balance Report 2. General Ledger Activity Report B. Portfolio Reports 1. Portfolio Report 2. Tax Lot Report 3. Purchase Journal 4. Sell/Maturity Journal 5. Amortization/Accretion Report 6. Maturity Projection Report C. Pricing Reports 1. Pricing Report 2. Pricing Report by Market Value 3. Pricing Variance by % Change 4. NAV Report 5. NAV Proof Report 6. Money Market Pricing Report D. Accounts Receivable/Payable Reports 1. Accounts Receivable for Investments Report 2. Accounts Payable for Investments Report 3. Interest Accrual Report 4. Dividend Accrual Report E. Other Reports 1. Dividend Computation Report 2. Cash Availability Report 3. Settlement Journal - ---------------------------------------------------------------------------------------------------------------------- Monthly Reports A. Standard Reports 1. Cost Proof Report 2. Transaction History Report 3. Realized Gain/Loss Report 4. Interest Record Report 5. Dividend Record Report 6. Broker Commission Totals 7. Broker Principal Trades 8. Shareholder Activity Report 9. SEC Yield Calculation Work Sheet (fixed-income funds only)
III Optional Services Available - Initial (for desired services) _________ Additional portfolio sub-adviser fee -$10,000 per portfolio __________ Multiple custodian fee -$5,000 per fund group __________ GNMA securities fee -$2,500 per portfolio __________ S.E.C. audit requirement -Pass through IV SPECIAL MAINTENANCE FEES - ---------------------------------------------------------------------------------------------------------------------- o Non-Routine Investment Processing: - $500 per month for the first type; $250 per month o Short Sales for each additional. ($1000 maximum per month) o Options o Futures o Additional Brokers Used For Short Sales - $500 per month for each additional broker used in excess of one o High Trade Volume - $2 per trade for each trade in excess of 100 trades per month per portfolio o Illiquid/Manually-Priced Securities - $100 per month for each security requiring Pricing Committee review V REPORT GENERATION FEES - ---------------------------------------------------------------------------------------------------------------------- o AD-HOC Report Generation - $75.00 per report o Non-System Generated Reports - $75.00 per occurrence - $25 per month for each recipient in excess of o Dissemination of NAV Information To Third-Party three Recipients, e.g., NASDAQ, Morningstar, Lipper o Reruns - $75.00 per run o Extract Tapes - $110.00 plus
VI SYSTEMS PROGRAMMING LABOR CHARGES - ---------------------------------------------------------------------------------------------------------------------- o System Support Representatives - $100.00 per hour o Programmers, Consultants or Department Heads - $125.00 per hour o Officers - $150.00 per hour VII REPRICING CHARGES - ---------------------------------------------------------------------------------------------------------------------- For incorrect or untimely information provided by an Advisor or its Agent, Unified will charge $200.00 per day for each day that a portfolio is repriced. Unified reserves the right to charge $25 per occurrence for each information change where repricing is not required, but additional work processes must be performed or repeated, e.g., incorrect/late trade ticket. VIII De-Conversion Fees - ---------------------------------------------------------------------------------------------------------------------- De-Conversion fees will be subject to additional charges commensurate with particular circumstances and dependent upon scope of problems.
FUND ADMINISTRATION FEE SCHEDULE I Standard Fee* - ---------------------------------------------------------------------------------------------------------------------- 0.10% for the first $50 million in average net assets per portfolio and/or share class per year; 0.07% from $50 million to $100 million in average net assets per portfolio and/or share class per year; 0.05% from $100 million to $150 million in average net assets per portfolio and/or share class per year; 0.03% over $150 million in average net assets per portfolio and/or share class per year; * Subject to a $30,000 annual minimum per portfolio (one share class) plus $7,500 per additional share class. Fees are billed on a monthly basis. II ADDITIONAL SERVICES AND FEES - ---------------------------------------------------------------------------------------------------------------------- 1. Assistance in preparation and filing for an exemptive - $1,500 minimum order or no action letter from the Securities & Exchange Commission 2. Assist in the preparation and filing of additional - Negotiable Funds Registration Statement on Form N-1A or any replacement thereof 3. Assistance in preparation, filing and vote compilation - $5,000 minimum per Special Meeting of Proxy Statement for Special Shareholders Meeting 4. Assistance in Dissolution and Deregistration of the - $15,000 minimum Fund (including related proxy statement) 5. Reorganization or Merger of the Fund or portfolios - $15,000 minimum (including proxy statement and excluding tax opinion) 6. Blue Sky Filing Fees - $25.00 per permit 7. Such other duties related to the Administration of the - Negotiable Fund as agreed to by Unified
EX-99.I 5 ex9923i.txt LEGAL CONSENT EX-99.23.i THOMPSON BRUSSELS CINCINNATI CLEVELAND COLUMBUS DAYTON NEW YORK WASHINGTON, D.C. - -------------------------------------------------------------------------------- HINE ---- November 24, 2004 AmeriPrime Funds 431 North Pennsylvania Street Indianapolis, IN 46204 RE: AMERIPRIME FUNDS, FILE NOS. 33-96826 AND 811-9096 Gentlemen: A legal opinion that we prepared was filed with Post-Effective Amendment No. 76 to the AmeriPrime Funds' Registration Statement (the "Legal Opinion"). We hereby give you our consent to incorporate by reference the Legal Opinion into Post-Effective Amendment No. 83 to the Registration Statement (the "Amendment"), and consent to all references to us in the Amendment. Very truly yours, /s/ Thompson Hine LLP THOMPSON HINE LLP EX-99.J 6 ex9923j.txt AUDITORS CONSENT EX-99.23.j CONSENT OF INDEPENDENT AUDITORS As independent public accountants, we hereby consent to the use of our report dated September 28, 2004 for the Dobson Covered Call Fund (the "Fund") and to all references to our firm included in or made a part of this Post-Effective Amendment No. 83 to AmeriPrime Funds' Registration Statement on Form N-1A (file No. 33-96826), including the references to our firm under the heading "Financial Highlights" in the Prospectus and the heading "Accountants" in the Statement of Additional Information of the Fund. /s/ Cohen McCurdy, Ltd. Cohen McCurdy, Ltd. Westlake, Ohio November 24, 2004 -----END PRIVACY-ENHANCED MESSAGE-----