MAI Managed Volatility Fund

I Semi-Annual Report (Unaudited) February 29, 2016 MAI Managed Volatility Fund Managed By MAI Capital Management, LLC

TABLE OF CONTENTS Schedule of Investments 1 Schedule of Call and Put Options Written 2 Notes to Schedules of Investments and Call and Put Options Written 7 Statement of Assets and Liabilities 8 Statement of Operations 9 Statements of Changes in Net Assets 10 Financial Highlights 11 Notes to Financial Statements 13 Additional Information 18

SCHEDULE OF INVESTMENTS Shares Security Description Common Stock - 49.2% Value Communications - 2.6% 21,700 Comcast Corp., Class A (a)(b) $ 1,252,741 28,200 Verizon Inc. (a)(b) 1,430,586 2,683,327 Consumer Discretionary - 6.5% 60,300 Ford Motor Co. (a)(b) 754,353 29,700 Macy's, Inc. (a)(b) 1,283,337 8,000 McDonald's Corp. (a)(b) 937,520 9,100 Target Corp. (a)(b) 713,895 13,500 The Home Depot, Inc. (a)(b) 1,675,620 13,500 The Walt Disney Co. (a)(b) 1,289,520 6,654,245 Consumer Staples - 5.9% 10,400 CVS Health Corp. (a)(b) 1,010,568 13,200 Diageo PLC, ADR (a)(b) 1,354,320 21,400 Mondelez International, Inc., Class A (a)(b) 867,342 15,500 PepsiCo, Inc. (a)(b) 1,516,210 16,000 The Procter & Gamble Co. (a)(b) 1,284,640 6,033,080 Energy - 2.8% 1,570 California Resources Corp. 882 9,800 Chevron Corp. (a)(b) 817,712 16,700 Occidental Petroleum Corp. (a)(b) 1,149,294 12,000 Schlumberger, Ltd. (a)(b) 860,640 2,828,528 Financials - 6.7% 118,100 Bank of America Corp. (a)(b) 1,478,612 13,300 Chubb, Ltd. (a)(b) 1,536,549 27,800 JPMorgan Chase & Co. (a)(b) 1,565,140 29,100 MetLife, Inc. (a)(b) 1,151,196 25,100 Wells Fargo & Co. (a)(b) 1,177,692 6,909,189 Health Care - 9.1% 33,000 Abbott Laboratories (a)(b) 1,278,420 11,100 Amgen, Inc. (a)(b) 1,579,308 13,200 Cardinal Health, Inc. (a)(b) 1,078,440 15,200 Johnson & Johnson (a)(b) 1,599,192 18,225 Medtronic PLC (a)(b) 1,410,433 50,500 Pfizer, Inc. (a)(b) 1,498,335 8,100 UnitedHealth Group, Inc. (a)(b) 964,710 9,408,838 Industrials - 7.4% 42,400 General Electric Co. (a)(b) 1,235,536 10,600 Honeywell International, Inc. (a)(b) 1,074,310 10,800 Raytheon Co. (a)(b) 1,337,580 16,900 The Boeing Co. (a)(b) 1,997,242 9,600 United Parcel Service, Inc., Class B (a)(b) 926,880 10,500 United Technologies Corp. (a)(b) 1,014,510 7,586,058 Shares Security Description Value Information Technology - 6.6% 12,300 Apple, Inc. (a)(b) $ 1,189,287 38,800 Cisco Systems, Inc. (a)(b) 1,015,784 18,800 EMC Corp. (a)(b) 491,244 42,700 Intel Corp. (a)(b) 1,263,493 18,500 Microsoft Corp. (a)(b) 941,280 21,300 Oracle Corp. (a)(b) 783,414 22,800 QUALCOMM, Inc. (a)(b) 1,158,012 6,842,514 Materials - 0.6% 10,700 E.I. du Pont de Nemours & Co. (a)(b) 651,309 Utilities - 1.0% 9,100 NextEra Energy, Inc. (a)(b) 1,026,662 Total Common Stock (Cost $54,986,337) 50,623,750 Principal Security Description Rate Maturity Value U.S. Government & Agency Obligations - 5.1% U.S. Treasury Securities - 5.1% $ 2,660,000 U.S. Treasury Bill (c) 0.46 % 07/14/16 2,656,585 2,660,000 U.S. Treasury Bill (c) 0.53 02/02/17 2,645,274 5,301,859 Total U.S. Government & Agency Obligations (Cost $5,302,175) 5,301,859 Shares Security Description Value Money Market Fund - 43.4% 44,660,994 Fidelity Institutional Cash Money Market Fund, 0.35% (d) (Cost $44,660,994) 44,660,994 Total Investments - 97.7% (Cost $104,949,506)* $100,586,603 Total Written Options - (1.0)% (Premiums Received $(1,310,789))* (1,088,499) Other Assets & Liabilities, Net 3.3% 3,431,662 Net Assets 100.0% $102,929,766 See Notes to Financial Statements. 1

SCHEDULE OF CALL AND PUT OPTIONS WRITTEN Contracts Security Description Written Options - (1.0)% Strike Price Exp. Date Value Call Options Written - (0.6)% (53) Abbott Laboratories $ 44.00 03/16 $ (53) (79) Abbott Laboratories 40.00 03/16 (2,449) (40) Abbott Laboratories 39.00 03/16 (2,800) (53) Abbott Laboratories 41.00 04/16 (1,749) (21) Amgen, Inc. 165.00 03/16 (21) (14) Amgen, Inc. 160.00 03/16 (98) (16) Amgen, Inc. 155.00 03/16 (736) (34) Amgen, Inc. 160.00 04/16 (1,870) (26) Apple, Inc. 110.00 03/16 (78) (16) Apple, Inc. 100.00 03/16 (1,144) (19) Apple, Inc. 104.00 03/16 (485) (19) Apple, Inc. 105.00 04/16 (1,178) (16) Apple, Inc. 100.00 04/16 (3,072) (82) Bank of America Corp. 17.00 03/16 (82) (53) Bank of America Corp. 14.00 03/16 (212) (253) Bank of America Corp. 13.00 03/16 (5,819) (53) Bank of America Corp. 12.00 03/16 (3,975) (32) Bank of America Corp. 13.50 03/16 (416) (239) Bank of America Corp. 14.00 04/16 (3,585) (225) Bank of America Corp. 13.00 04/16 (9,900) (56) Cardinal Health, Inc. 85.00 03/16 (2,940) (40) Cardinal Health, Inc. 85.00 04/16 (5,000) (16) Chevron Corp. 92.50 03/16 (160) (19) Chevron Corp. 92.00 03/16 (589) (27) Chevron Corp. 95.00 04/16 (972) (62) Chubb, Ltd. 120.00 03/16 (3,410) (21) Chubb, Ltd. 115.00 03/16 (5,617) (27) Chubb, Ltd. 120.00 04/16 (3,510) (92) Cisco Systems, Inc. 26.00 03/16 (5,796) (36) Cisco Systems, Inc. 25.00 03/16 (4,914) (62) Cisco Systems, Inc. 24.00 03/16 (14,508) (27) Cisco Systems, Inc. 26.50 04/16 (1,418) (27) Cisco Systems, Inc. 27.00 04/16 (1,026) (27) Comcast Corp., Class A 58.50 03/16 (1,728) (42) Comcast Corp., Class A 60.00 03/16 (1,470) (38) Comcast Corp., Class A 57.50 03/16 (5,301) (53) Comcast Corp., Class A 60.00 04/16 (4,214) (16) CVS Health Corp. 100.00 03/16 (144) (40) CVS Health Corp. 100.00 03/16 (2,200) (27) CVS Health Corp. 100.00 04/16 (4,050) (32) Diageo PLC, ADR 110.00 03/16 (480) (21) Diageo PLC, ADR 110.00 04/16 (1,470) (16) Diageo PLC, ADR 105.00 04/16 (3,440) Contracts Security Description Strike Price Exp. Date Value (48) E.I. du Pont de Nemours & Co. $ 60.00 03/16 $ (9,720) (19) E.I. du Pont de Nemours & Co. 57.50 03/16 (7,362) (27) E.I. du Pont de Nemours & Co. 62.50 04/16 (4,671) (67) EMC Corp. 26.00 03/16 (3,953) (121) EMC Corp. 25.00 03/16 (15,911) (178) Ford Motor Co. 12.75 03/16 (4,094) (40) Ford Motor Co. 12.00 03/16 (2,720) (53) Ford Motor Co. 12.00 03/16 (3,816) (40) Ford Motor Co. 12.50 04/16 (2,080) (159) Ford Motor Co. 12.75 04/16 (6,360) (160) General Electric Co. 30.00 03/16 (2,880) (40) General Electric Co. 30.00 03/16 (1,040) (53) General Electric Co. 31.00 04/16 (954) (32) General Electric Co. 30.00 04/16 (1,344) (85) Honeywell International, Inc. 105.00 03/16 (7,352) (21) Honeywell International, Inc. 100.00 04/16 (10,080) (27) Intel Corp. 31.50 03/16 (81) (173) Intel Corp. 32.00 03/16 (692) (54) Intel Corp. 31.00 03/16 (864) (40) Intel Corp. 32.00 04/16 (800) (27) Intel Corp. 31.00 04/16 (1,134) (26) Johnson & Johnson 106.00 03/16 (1,950) (35) Johnson & Johnson 100.00 03/16 (19,337) (21) Johnson & Johnson 106.00 04/16 (3,486) (27) Johnson & Johnson 105.00 04/16 (7,047) (27) JPMorgan Chase & Co. 61.00 03/16 (135) (19) JPMorgan Chase & Co. 62.50 03/16 (95) (61) JPMorgan Chase & Co. 60.00 03/16 (1,525) (21) JPMorgan Chase & Co. 61.00 04/16 (840) (80) JPMorgan Chase & Co. 62.50 04/16 (2,080) (27) Macy's, Inc. 46.00 03/16 (473) (27) Macy's, Inc. 47.00 03/16 (459) (51) Macy's, Inc. 43.00 03/16 (6,298) (54) Macy's, Inc. 42.00 03/16 (9,990) (21) Macy's, Inc. 41.00 03/16 (5,586) (21) Macy's, Inc. 39.00 03/16 (9,345) (40) Macy's, Inc. 44.00 03/16 (3,700) (40) Macy's, Inc. 46.00 04/16 (2,860) (48) McDonald's Corp. 120.00 03/16 (3,744) (16) McDonald's Corp. 118.00 04/16 (3,440) (16) McDonald's Corp. 120.00 04/16 (2,728) (59) Medtronic PLC 80.00 03/16 (4,012) (21) Medtronic PLC 77.50 03/16 (3,780) (27) Medtronic PLC 80.00 04/16 (3,159) (73) MetLife, Inc. 47.50 03/16 (73) (48) MetLife, Inc. 40.00 03/16 (4,296) (27) MetLife, Inc. 41.00 03/16 (1,674) (108) MetLife, Inc. 42.50 04/16 (5,400) (20) Microsoft Corp. 57.50 03/16 (40) (66) Microsoft Corp. 55.00 03/16 (528) (27) Microsoft Corp. 55.00 04/16 (702) See Notes to Financial Statements. 2

SCHEDULE OF CALL AND PUT OPTIONS WRITTEN Contracts Security Description Strike Price Exp. Date Value (27) Microsoft Corp. $ 55.00 04/16 $ (945) (27) Mondelez International, Inc., Class A 46.00 03/16 (81) (52) Mondelez International, Inc., Class A 45.00 03/16 (208) (54) Mondelez International, Inc., Class A 42.00 03/16 (2,025) (41) Mondelez International, Inc., Class A 44.00 04/16 (1,189) (40) Mondelez International, Inc., Class A 43.00 04/16 (1,860) (56) NextEra Energy, Inc. 115.00 04/16 (11,760) (16) NextEra Energy, Inc. 110.00 04/16 (8,320) (21) Occidental Petroleum Corp. 73.00 03/16 (368) (40) Occidental Petroleum Corp. 70.00 03/16 (5,000) (38) Occidental Petroleum Corp. 67.50 03/16 (9,880) (27) Occidental Petroleum Corp. 77.50 04/16 (810) (54) Oracle Corp. 38.00 03/16 (2,646) (53) Oracle Corp. 37.00 03/16 (4,903) (53) Oracle Corp. 39.00 04/16 (2,650) (27) PepsiCo, Inc. 100.00 03/16 (270) (27) PepsiCo, Inc. 97.50 03/16 (3,146) (27) PepsiCo, Inc. 101.00 04/16 (972) (53) PepsiCo, Inc. 100.00 04/16 (4,823) (40) Pfizer, Inc. 33.00 03/16 (40) (80) Pfizer, Inc. 32.00 03/16 (240) (27) Pfizer, Inc. 30.00 03/16 (1,026) (25) Pfizer, Inc. 31.00 03/16 (375) (40) Pfizer, Inc. 30.50 03/16 (1,080) (134) Pfizer, Inc. 31.00 04/16 (4,288) (88) QUALCOMM, Inc. 52.50 03/16 (5,016) (7) QUALCOMM, Inc. 48.00 03/16 (2,275) (27) QUALCOMM, Inc. 55.00 04/16 (1,323) (27) QUALCOMM, Inc. 52.50 04/16 (3,267) (39) QUALCOMM, Inc. 50.00 04/16 (9,672) (19) Raytheon Co. 130.00 03/16 (770) (32) Raytheon Co. 125.00 03/16 (6,048) (27) Raytheon Co. 130.00 04/16 (2,808) (18) Schlumberger, Ltd. 75.00 03/16 (1,224) (19) Schlumberger, Ltd. 70.00 03/16 (5,842) (40) Schlumberger, Ltd. 80.00 04/16 (1,760) (16) Schlumberger, Ltd. 75.00 04/16 (2,576) (16) Target Corp. 65.00 03/16 (22,120) (19) Target Corp. 77.00 03/16 (5,367) (48) Target Corp. 72.50 04/16 (32,280) (43) The Boeing Co. 135.00 03/16 (43) (13) The Boeing Co. 125.00 03/16 (845) (32) The Boeing Co. 117.00 03/16 (13,440) (19) The Boeing Co. 124.00 04/16 (2,888) (16) The Boeing Co. 125.00 04/16 (3,088) (21) The Boeing Co. 120.00 04/16 (8,242) (54) The Home Depot, Inc. 130.00 03/16 (1,836) Contracts Security Description Strike Price Exp. Date Value (16) The Home Depot, Inc. $124.00 03/16 $ (4,384) (43) The Home Depot, Inc. 130.00 04/16 (5,160) (80) The Procter & Gamble Co. 80.00 03/16 (11,200) (16) The Procter & Gamble Co. 77.50 03/16 (5,120) (19) The Procter & Gamble Co. 82.50 04/16 (1,672) (19) The Procter & Gamble Co. 80.00 04/16 (3,952) (19) The Walt Disney Co. 105.00 03/16 (57) (42) The Walt Disney Co. 100.00 03/16 (1,470) (17) The Walt Disney Co. 97.50 03/16 (1,760) (16) The Walt Disney Co. 100.00 04/16 (1,888) (15) United Parcel Service, Inc., Class B 95.00 03/16 (3,555) (21) United Parcel Service, Inc., Class B 95.00 03/16 (5,607) (21) United Parcel Service, Inc., Class B 97.50 04/16 (4,442) (16) United Parcel Service, Inc., Class B 95.00 04/16 (5,720) (19) United Technologies Corp. 85.00 03/16 (23,227) (37) United Technologies Corp. 97.50 04/16 (10,785) (19) United Technologies Corp. 95.00 04/16 (8,607) (19) UnitedHealth Group, Inc. 120.00 03/16 (3,534) (21) UnitedHealth Group, Inc. 122.00 03/16 (3,003) (22) UnitedHealth Group, Inc. 130.00 04/16 (1,397) (19) UnitedHealth Group, Inc. 125.00 04/16 (3,078) (27) Verizon Inc. 50.00 03/16 (3,281) (93) Verizon Inc. 49.00 03/16 (22,134) (27) Verizon Inc. 47.00 03/16 (10,665) (27) Verizon Inc. 46.00 03/16 (13,257) (27) Verizon Inc. 50.00 04/16 (4,050) (27) Verizon Inc. 49.00 04/16 (6,156) (40) Wells Fargo & Co. 51.00 03/16 (40) (22) Wells Fargo & Co. 52.50 03/16 (22) See Notes to Financial Statements. 3

SCHEDULE OF CALL AND PUT OPTIONS WRITTEN Contracts Security Description Strike Price Exp. Date Value (80) Wells Fargo & Co. $ 50.00 03/16 $ (1,040) (27) Wells Fargo & Co. 51.00 04/16 (486) (27) Wells Fargo & Co. 50.00 04/16 (1,431) Total Call Options Written (Premiums Received $(701,502)) (684,584) Put Options Written - (0.4)% (113) Abbott Laboratories 38.00 03/16 (6,102) (68) Abbott Laboratories 37.00 03/16 (1,972) (59) Abbott Laboratories 36.00 03/16 (1,033) (16) Abbott Laboratories 32.00 03/16 (64) (53) Abbott Laboratories 36.00 04/16 (2,623) (16) Amgen, Inc. 130.00 03/16 (944) (34) Amgen, Inc. 125.00 03/16 (969) (16) Amgen, Inc. 135.00 04/16 (4,992) (16) Amgen, Inc. 130.00 04/16 (3,072) (19) Amgen, Inc. 125.00 04/16 (2,318) (16) Apple, Inc. 97.50 03/16 (3,904) (16) Apple, Inc. 95.00 03/16 (2,224) (16) Apple, Inc. 80.00 03/16 (96) (16) Apple, Inc. 91.00 03/16 (1,160) (16) Apple, Inc. 90.00 04/16 (1,968) (14) Apple, Inc. 87.50 04/16 (1,183) (16) Apple, Inc. 85.00 04/16 (928) (160) Bank of America Corp. 14.00 03/16 (24,720) (80) Bank of America Corp. 13.00 03/16 (5,600) (40) Bank of America Corp. 12.00 03/16 (960) (60) Bank of America Corp. 13.50 03/16 (6,690) (32) Bank of America Corp. 11.00 03/16 (288) (97) Bank of America Corp. 13.00 04/16 (8,827) (54) Bank of America Corp. 12.00 04/16 (2,430) (119) Bank of America Corp. 11.00 04/16 (2,499) (133) Bank of America Corp. 10.00 04/16 (1,330) (53) Bank of America Corp. 9.00 04/16 (265) (19) Cardinal Health, Inc. 82.50 03/16 (3,895) (50) Cardinal Health, Inc. 80.00 03/16 (5,125) (40) Cardinal Health, Inc. 75.00 04/16 (3,400) (16) Chevron Corp. 60.00 03/16 (16) (19) Chevron Corp. 76.00 03/16 (1,292) (27) Chevron Corp. 82.50 04/16 (9,180) (40) Chubb, Ltd. 110.00 03/16 (2,800) (21) Chubb, Ltd. 100.00 03/16 (21) (32) Chubb, Ltd. 110.00 04/16 (5,280) (33) Cisco Systems, Inc. 24.00 03/16 (198) (69) Cisco Systems, Inc. 23.00 03/16 (207) (27) Cisco Systems, Inc. 21.00 03/16 (54) (40) Cisco Systems, Inc. 25.00 04/16 (1,120) Contracts Security Description Strike Price Exp. Date Value (53) Cisco Systems, Inc. $ 24.00 04/16 $ (1,431) (27) Comcast Corp., Class A 55.00 03/16 (1,350) (38) Comcast Corp., Class A 45.00 03/16 (190) (27) Comcast Corp., Class A 55.00 03/16 (1,607) (27) Comcast Corp., Class A 52.50 04/16 (1,728) (27) Comcast Corp., Class A 50.00 04/16 (1,026) (16) Costco Wholesale Corp. 143.00 04/16 (2,880) (27) Costco Wholesale Corp. 130.00 04/16 (1,620) (16) CVS Health Corp. 91.00 03/16 (16) (40) CVS Health Corp. 85.00 03/16 (400) (27) CVS Health Corp. 90.00 04/16 (2,241) (16) Diageo PLC, ADR 100.00 03/16 (1,840) (16) Diageo PLC, ADR 95.00 03/16 (560) (21) Diageo PLC, ADR 95.00 04/16 (2,184) (21) E.I. du Pont de Nemours & Co. 55.00 03/16 (588) (27) E.I. du Pont de Nemours & Co. 42.50 03/16 (27) (27) E.I. du Pont de Nemours & Co. 55.00 04/16 (1,755) (40) EMC Corp. 23.00 03/16 (240) (40) EMC Corp. 22.00 03/16 (40) (174) Ford Motor Co. 11.75 03/16 (1,740) (107) Ford Motor Co. 10.75 03/16 (428) (40) Ford Motor Co. 11.00 04/16 (300) (27) Ford Motor Co. 11.75 04/16 (648) (40) General Electric Co. 29.00 03/16 (1,920) (53) General Electric Co. 27.00 03/16 (583) (80) General Electric Co. 26.00 03/16 (480) (94) General Electric Co. 27.50 03/16 (1,786) (40) General Electric Co. 28.00 04/16 (1,880) (85) General Electric Co. 26.00 04/16 (1,360) (37) Honeywell International, Inc. 100.00 03/16 (6,697) (19) Honeywell International, Inc. 92.50 03/16 (551) (32) Honeywell International, Inc. 87.50 03/16 (288) (21) Honeywell International, Inc. 97.50 04/16 (3,969) (27) Intel Corp. 28.00 03/16 (270) (40) Intel Corp. 29.00 03/16 (1,780) (80) Intel Corp. 28.00 03/16 (1,600) (40) Intel Corp. 27.00 03/16 (400) (67) Intel Corp. 26.00 03/16 (268) (55) Intel Corp. 28.00 04/16 (2,640) (40) Intel Corp. 26.00 04/16 (720) (27) Johnson & Johnson 98.00 03/16 (297) (35) Johnson & Johnson 90.00 03/16 (175) (27) Johnson & Johnson 100.00 04/16 (2,646) (21) JPMorgan Chase & Co. 52.50 03/16 (336) (103) JPMorgan Chase & Co. 57.50 03/16 (21,887) See Notes to Financial Statements. 4

SCHEDULE OF CALL AND PUT OPTIONS WRITTEN Contracts Security Description Strike Price Exp. Date Value (59) JPMorgan Chase & Co. $ 50.00 03/16 $ (1,151) (21) JPMorgan Chase & Co. 52.00 04/16 (1,722) (36) JPMorgan Chase & Co. 55.00 04/16 (6,966) (21) JPMorgan Chase & Co. 52.50 04/16 (2,446) (27) Macy's, Inc. 33.00 03/16 (27) (40) Macy's, Inc. 35.00 03/16 (200) (27) Macy's, Inc. 33.00 03/16 (27) (27) Macy's, Inc. 28.00 03/16 (27) (27) Macy's, Inc. 35.00 04/16 (351) (40) Macy's, Inc. 35.00 04/16 (740) (14) McDonald's Corp. 115.00 03/16 (1,554) (19) McDonald's Corp. 105.00 03/16 (266) (32) McDonald's Corp. 110.00 04/16 (3,104) (21) Medtronic PLC 72.50 03/16 (1,050) (19) Medtronic PLC 67.50 03/16 (342) (40) Medtronic PLC 65.00 03/16 (480) (27) Medtronic PLC 70.00 04/16 (1,944) (16) MetLife, Inc. 45.00 03/16 (8,720) (14) MetLife, Inc. 42.50 03/16 (4,102) (27) MetLife, Inc. 40.00 03/16 (3,550) (21) MetLife, Inc. 38.00 03/16 (1,439) (29) MetLife, Inc. 39.00 04/16 (3,335) (44) MetLife, Inc. 40.00 04/16 (8,360) (19) MetLife, Inc. 35.00 04/16 (931) (27) MetLife, Inc. 32.50 04/16 (716) (21) Microsoft Corp. 50.00 03/16 (1,764) (26) Microsoft Corp. 49.00 03/16 (1,482) (27) Microsoft Corp. 45.00 03/16 (297) (27) Microsoft Corp. 49.00 04/16 (1,971) (27) Microsoft Corp. 48.00 04/16 (2,214) (21) Mondelez International, Inc., Class A 40.00 03/16 (1,638) (21) Mondelez International, Inc., Class A 37.00 03/16 (399) (48) Mondelez International, Inc., Class A 36.00 03/16 (672) (54) Mondelez International, Inc., Class A 35.00 03/16 (540) (40) Mondelez International, Inc., Class A 34.00 04/16 (1,000) (16) NextEra Energy, Inc. 110.00 03/16 (1,600) (19) NextEra Energy, Inc. 105.00 03/16 (475) (19) NextEra Energy, Inc. 100.00 03/16 (285) (19) NextEra Energy, Inc. 97.50 03/16 (428) (13) NextEra Energy, Inc. 110.00 04/16 (2,470) (21) Occidental Petroleum Corp. 56.00 03/16 (21) (27) Occidental Petroleum Corp. 65.00 03/16 (2,565) (19) Occidental Petroleum Corp. 62.50 03/16 (1,045) (40) Occidental Petroleum Corp. 50.00 03/16 (40) Contracts Security Description Strike Price Exp. Date Value (27) Occidental Petroleum Corp. $ 62.50 04/16 $ (3,307) (53) Oracle Corp. 34.00 03/16 (1,325) (27) Oracle Corp. 32.00 03/16 (311) (27) Oracle Corp. 30.00 03/16 (162) (53) Oracle Corp. 33.00 04/16 (2,067) (21) PepsiCo, Inc. 95.00 03/16 (1,386) (54) PepsiCo, Inc. 92.50 03/16 (1,458) (46) PepsiCo, Inc. 95.00 04/16 (6,348) (121) Pfizer, Inc. 29.00 03/16 (3,630) (93) Pfizer, Inc. 28.00 03/16 (1,209) (27) Pfizer, Inc. 29.00 04/16 (1,566) (107) Pfizer, Inc. 28.00 04/16 (3,317) (21) QUALCOMM, Inc. 44.00 03/16 (210) (27) QUALCOMM, Inc. 40.00 03/16 (108) (46) QUALCOMM, Inc. 36.00 03/16 (46) (19) QUALCOMM, Inc. 35.00 03/16 (19) (27) QUALCOMM, Inc. 46.00 04/16 (1,593) (27) QUALCOMM, Inc. 45.00 04/16 (1,161) (21) QUALCOMM, Inc. 42.50 04/16 (546) (16) Raytheon Co. 120.00 03/16 (1,600) (19) Raytheon Co. 110.00 03/16 (285) (27) Raytheon Co. 115.00 04/16 (2,943) (19) Schlumberger, Ltd. 57.50 03/16 (76) (19) Schlumberger, Ltd. 55.00 03/16 (19) (19) Schlumberger, Ltd. 55.00 03/16 (133) (40) Schlumberger, Ltd. 65.00 04/16 (4,060) (40) Target Corp. 60.00 03/16 (40) (19) Target Corp. 65.00 04/16 (456) (27) Target Corp. 62.50 04/16 (459) (33) The Boeing Co. 105.00 03/16 (1,188) (21) The Boeing Co. 116.00 03/16 (5,176) (19) The Boeing Co. 105.00 04/16 (1,216) (37) The Boeing Co. 100.00 04/16 (2,590) (16) The Home Depot, Inc. 115.00 03/16 (880) (35) The Home Depot, Inc. 105.00 03/16 (420) (19) The Home Depot, Inc. 121.00 03/16 (3,828) (16) The Home Depot, Inc. 95.00 03/16 (216) (27) The Home Depot, Inc. 110.00 04/16 (2,322) (19) The Procter & Gamble Co. 80.00 03/16 (2,042) (21) The Procter & Gamble Co. 77.50 03/16 (861) (16) The Procter & Gamble Co. 70.00 03/16 (80) (19) The Procter & Gamble Co. 67.50 03/16 (57) (24) The Procter & Gamble Co. 80.00 03/16 (2,916) (40) The Procter & Gamble Co. 77.50 04/16 (3,900) (19) The Walt Disney Co. 92.50 03/16 (1,653) (19) The Walt Disney Co. 90.00 03/16 (817) (19) The Walt Disney Co. 82.50 03/16 (114) (19) The Walt Disney Co. 80.00 03/16 (57) (20) The Walt Disney Co. 97.50 04/16 (7,900) (16) The Walt Disney Co. 87.50 04/16 (1,280) See Notes to Financial Statements. 5

SCHEDULE OF CALL AND PUT OPTIONS WRITTEN Contracts Security Description Strike Price Exp. Date Value (16) The Walt Disney Co. $ 75.00 04/16 $ (144) (19) United Parcel Service, Inc., Class B 92.50 03/16 (1,045) (21) United Parcel Service, Inc., Class B 80.00 03/16 (137) (16) United Parcel Service, Inc., Class B 92.50 04/16 (2,080) (21) United Parcel Service, Inc., Class B 90.00 04/16 (1,785) (25) United Technologies Corp. 87.50 03/16 (613) (19) United Technologies Corp. 90.00 04/16 (2,280) (21) United Technologies Corp. 87.50 04/16 (1,722) (16) UnitedHealth Group, Inc. 95.00 03/16 (80) (21) UnitedHealth Group, Inc. 111.00 03/16 (1,775) (40) UnitedHealth Group, Inc. 110.00 04/16 (6,420) (27) Verizon Inc. 49.00 03/16 (675) (67) Verizon Inc. 48.00 03/16 (871) (27) Verizon Inc. 47.00 03/16 (216) (54) Verizon Inc. 41.00 03/16 (81) (21) Verizon Inc. 48.00 04/16 (1,029) (27) Verizon Inc. 47.00 04/16 (891) (40) Verizon Inc. 44.00 04/16 (520) (27) Wells Fargo & Co. 46.00 03/16 (1,215) (67) Wells Fargo & Co. 48.00 03/16 (10,921) (27) Wells Fargo & Co. 45.00 03/16 (1,296) (27) Wells Fargo & Co. 46.00 04/16 (2,686) (27) Wells Fargo & Co. 48.00 04/16 (5,967) (38) Wells Fargo & Co. 47.00 04/16 (6,536) Total Put Options Written (Premiums Received $(609,287)) (403,915) Total Written Options - (1.0)% (Premiums Received $(1,310,789)) $(1,088,499) See Notes to Financial Statements. 6

AFA MAI MANAGED VOLATILITY FUND NOTES TO SCHEDULES OF INVESTMENTS AND CALL AND PUT OPTIONS WRITTEN ADR PLC (a) (b) American Depositary Receipt Public Limited Company Subject to call option written by the Fund. Subject to put option written by the Fund. (c) (d) Rate presented is yield to maturity. Variable rate security. Rate presented is as of February 29, 2016. * Cost for federal income tax purposes is substantially the same as for financial statement purposes and net unrealized depreciation consists of: Gross Unrealized Appreciation $ 894,630 Gross Unrealized Depreciation (5,035,243) Net Unrealized Depreciation $ (4,140,613) The following is a summary of the inputs used to value the Fund s investments and other financial instruments and liabilities as of February 29, 2016. The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the Security Valuation section in Note 2 of the accompanying Notes to Financial Statements. Level 1 Level 2 Level 3 Total Assets Investments At Value Common Stock Communications $ 2,683,327 $ - $ - $ 2,683,327 Consumer Discretionary 6,654,245 - - 6,654,245 Consumer Staples 6,033,080 - - 6,033,080 Energy 2,828,528 - - 2,828,528 Financials 6,909,189 - - 6,909,189 Health Care 9,408,838 - - 9,408,838 Industrials 7,586,058 - - 7,586,058 Information Technology 6,842,514 - - 6,842,514 Materials 651,309 - - 651,309 Utilities 1,026,662 - - 1,026,662 U.S. Government & Agency Obligations - 5,301,859-5,301,859 Money Market Fund - 44,660,994-44,660,994 Total Investments At Value $ 50,623,750 $ 49,962,853 $ - $ 100,586,603 Total Assets $ 50,623,750 $ 49,962,853 $ - $ 100,586,603 Liabilities Other Financial Instruments** Written Options (448,850) (639,649) - (1,088,499) Total Liabilities $ (448,850) $ (639,649) $ - $ (1,088,499) **Other Financial Instruments are derivative instruments reflected in separate schedules such as written options, which appear in the Schedule of Call and Put Options Written and are valued at their market value at period end. The Fund utilizes the end of period methodology when determining transfers. There were no transfers among Level 1, Level 2 and Level 3 for the period ended February 29, 2016. PORTFOLIO HOLDINGS % of Net Assets Common Stock 49.2 % U.S. Government & Agency Obligations 5.1 % Money Market Fund*** 43.4 % Written Options (1.0)% Other Assets and Liabilites 3.3 % 100.0 % AFA *** Used to meet the collateral requirements of a tri-party agreement between the prime broker, custodian and the Fund. PORTFOLIO HOLDINGS % of Common Stock Communications 5.3% Consumer Discretionary 13.1% Consumer Staples 11.9% Energy 5.6% Financials 13.7% Health Care 18.6% Industrials 15.0% Information Technology 13.5% Materials 1.3% Utilities 2.0% 100.0% See Notes to Financial Statements. 7

STATEMENT OF ASSETS AND LIABILITIES ASSETS. Total investments, at value (Cost $104,949,506) $ 100,586,603 Deposits with brokers 3,160,640 Receivables: Fund shares sold 45,538 Investment securities sold 371,152 Dividends 228,230 Prepaid expenses 21,198 Total Assets 104,413,361 LIABILITIES Call options written, at value (Premiums received $701,502) 684,584 Put options written, at value (Premiums received $609,287) 403,915 Payables: Investment securities purchased 237,184 Fund shares redeemed 83,580 Accrued Liabilities: Investment adviser fees 42,637 Fund services fees 15,237 Other expenses 16,458 Total Liabilities 1,483,595 NET ASSETS $ 102,929,766 COMPONENTS OF NET ASSETS Paid-in capital $ 110,207,554 Undistributed net investment income 175,381 Accumulated net realized loss (3,312,556) Net unrealized depreciation (4,140,613) NET ASSETS $ 102,929,766 SHARES OF BENEFICIAL INTEREST AT NO PAR VALUE (UNLIMITED SHARES AUTHORIZED) Institutional Class 10,234,350 Investor Class 67,680 NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE Institutional Class (based on net assets of $102,245,425) $ 9.99 Investor Class (based on net assets of $684,341) $ 10.11 See Notes to Financial Statements. 8

STATEMENT OF OPERATIONS SIX MONTHS ENDED INVESTMENT INCOME Dividend income. $ 819,330 Interest income 2,599 Total Investment Income 821,929 Adviser EXPENSES Investment adviser fees 393,703 Fund services fees 95,291 Transfer agent fees: Institutional Class 4,808 Investor Class 1,259 Non 12b-1 shareholder servicing fees: Institutional Class 33,074 Investor Class 535 Distribution fees: Investor Class 928 Custodian fees 6,050 Registration fees: Institutional Class 8,124 Investor Class 7,725 Professional fees 20,787 Trustees' fees and expenses 4,347 Miscellaneous expenses 27,354 Total Expenses 603,985 Fees waived and expenses reimbursed (83,367) Net Expenses 520,618 NET INVESTMENT INCOME 301,311 NET REALIZED AND UNREALIZED GAIN (LOSS) Net realized gain (loss) on: Investments (4,649,200) Written options 2,392,356 Net realized loss (2,256,844) Net change in unrealized appreciation (depreciation) on: Investments 957,931 Written options 495,765 Net change in unrealized appreciation (depreciation) 1,453,696 NET REALIZED AND UNREALIZED LOSS (803,148) DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $ (501,837) See Notes to Financial Statements. 9

STATEMENTS OF CHANGES IN NET ASSETS OPERATIONS For the Six Months Ended February 29, 2016 For the Year Ended August 31, 2015 Net investment income $ 301,311 $ 545,864 Net realized gain (loss) (2,256,844) 3,544,400 Net change in unrealized appreciation (depreciation) 1,453,696 (6,086,482) Decrease in Net Assets Resulting from Operations (501,837) (1,996,218) DISTRIBUTIONS TO SHAREHOLDERS FROM Net investment income: Institutional Class (211,722) (363,538) Net realized gain: Institutional Class (3,425,420) (7,137,677) Investor Class (24,762) (66,579) Total Distributions to Shareholders (3,661,904) (7,567,794) CAPITAL SHARE TRANSACTIONS Sale of shares: Institutional Class 5,775,373 41,911,303 Investor Class 5,535 179,407 Reinvestment of distributions: Institutional Class 3,583,743 7,335,452 Investor Class 24,021 64,779 Redemption of shares: 2Institutional Class (8,836,056) (17,251,977) 1Investor Class (112,228) (276,241) Increase in Net Assets from Capital Share Transactions 440,388 31,962,723 Increase (Decrease) in Net Assets (3,723,353) 22,398,711 NET ASSETS Beginning of Period 106,653,119 84,254,408 End of Period (Including line (a)) $ 102,929,766 $ 106,653,119 SHARE TRANSACTIONS Sale of shares: Institutional Class 561,793 3,830,755 Investor Class 527 16,157 Reinvestment of distributions: Institutional Class 350,769 697,316 Investor Class 2,324 6,109 Redemption of shares: Institutional Class (859,157) (1,598,769) Investor Class (10,879) (25,190) Increase in Shares 45,377 2,926,378 (a) Undistributed net investment income $ 175,381 $ 85,792 See Notes to Financial Statements. 10

FINANCIAL HIGHLIGHTS These financial highlights reflect selected data for a share outstanding throughout each period. INSTITUTIONAL CLASS For the Six Months Ended February 29, 2016 For the Year Ended August 31, 2015 For the Year Ended August 31, 2014 For the Year Ended August 31, 2013 For the Year Ended August 31, 2012 September 23, 2010 (a) through August 31, 2011 NET ASSET VALUE, Beginning of Period $ 10.40 $ 11.49 $ 10.93 $ 10.86 $ 10.26 $ 10.00 INVESTMENT OPERATIONS Net investment income (b) 0.03 0.06 0.04 0.06 0.07 0.06 Net realized and unrealized gain (loss) (0.08) (0.29) 1.18 0.44 1.00 0.28 Total from Investment Operations (0.05) (0.23) 1.22 0.50 1.07 0.34 DISTRIBUTIONS TO SHAREHOLDERS FROM Net investment income (0.02) (0.04) (0.03) (0.05) (0.08) (0.08) Net realized gain (0.34) (0.82) (0.63) (0.38) (0.39) (c) Total Distributions to Shareholders (0.36) (0.86) (0.66) (0.43) (0.47) (0.08) NET ASSET VALUE, End of Period $ 9.99 $ 10.40 $ 11.49 $ 10.93 $ 10.86 $ 10.26 TOTAL RETURN (0.54)%(d) (1.99)% 11.62% 4.81% 10.71% 3.42%(d) RATIOS/SUPPLEMENTARY DATA Net Assets at End of Period (000's omitted) $102,245 $105,857 $83,343 $71,896 $46,352 $25,929 Ratios to Average Net Assets: Net investment income 0.58%(e) 0.53% 0.32% 0.52% 0.66% 0.61%(e) Net expenses 0.99%(e) 0.99% 0.99% 0.99% 0.99% 0.99%(e) Gross expenses (f) 1.13%(e) 1.11% 1.17% 1.21% 1.53% 2.45%(e) PORTFOLIO TURNOVER RATE 58%(d) 147% 203% 192% 102% 105%(d) (a) Commencement of operations. (b) Calculated based on average shares outstanding during each period. (c) Less than $0.01 per share. (d) Not annualized. (e) Annualized. (f) Reflects the expense ratio excluding any waivers and/or reimbursements. See Notes to Financial Statements. 11

FINANCIAL HIGHLIGHTS These financial highlights reflect selected data for a share outstanding throughout each period. INVESTOR CLASS For the Six Months Ended February 29, 2016 For the Year Ended August 31, 2015 For the Year Ended August 31, 2014 For the Year Ended August 31, 2013 For the Year Ended August 31, 2012 December 2, 2010 (a) Through August 31, 2011 NET ASSET VALUE, Beginning of Period $ 10.51 $ 11.60 $ 11.00 $ 10.90 $ 10.27 $ 10.19 INVESTMENT OPERATIONS Net investment income (b) 0.02 0.03 0.01 0.03 0.04 0.03 Net realized and unrealized gain (loss) (0.08) (0.30) 1.22 0.45 1.00 0.10 Total from Investment Operations (0.06) (0.27) 1.23 0.48 1.04 0.13 DISTRIBUTIONS TO SHAREHOLDERS FROM Net investment income (0.02) (0.05) Net realized gain (0.34) (0.82) (0.63) (0.38) (0.39) (c) Total Distributions to Shareholders (0.34) (0.82) (0.63) (0.38) (0.41) (0.05) NET ASSET VALUE, End of Period $ 10.11 $ 10.51 $ 11.60 $ 11.00 $ 10.90 $ 10.27 TOTAL RETURN (0.64)%(d) (2.33)% 11.62% 4.58% 10.35% 1.31%(d) RATIOS/SUPPLEMENTARY DATA Net Assets at End of Period (000's omitted) $684 $796 $912 $916 $6,070 $5,135 Ratios to Average Net Assets: Net investment income 0.32%(e) 0.29% 0.07% 0.28% 0.43% 0.38%(e) Net expenses 1.24%(e) 1.24% 1.24% 1.24% 1.24% 1.24%(e) Gross expenses (f) 3.94%(e) 3.54% 3.40% 2.21% 2.12% 3.12%(e) PORTFOLIO TURNOVER RATE 58%(d) 147% 203% 192% 102% 105%(d) (a) Commencement of operations. (b) Calculated based on average shares outstanding during each period. (c) Less than $0.01 per share. (d) Not annualized. (e) Annualized. (f) Reflects the expense ratio excluding any waivers and/or reimbursements. See Notes to Financial Statements. 12

NOTES TO FINANCIAL STATEMENTS Note 1. Organization The MAI Managed Volatility Fund (the Fund ) is a diversified portfolio of Forum Funds (the Trust ). The Trust is a Delaware statutory trust that is registered as an open-end, management investment company under the Investment Company Act of 1940 (the Act ), as amended. Under its Trust Instrument, the Trust is authorized to issue an unlimited number of the Fund s shares of beneficial interest without par value. The Fund currently offers two classes of shares: Institutional Class and Investor Class. Institutional Class and Investor Class commenced operations on September 23, 2010, and December 2, 2010, respectively. The Fund s investment objective is income and long-term capital appreciation. Prior to September 28, 2015, the Fund was named Dividend Plus + Income Fund. Note 2. Summary of Significant Accounting Policies These financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ( GAAP ), which require management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of increases and decreases in net assets from operations during the fiscal period. Actual amounts could differ from those estimates. The following summarizes the significant accounting policies of the Fund: Security Valuation Exchange-traded securities and over-the-counter securities are valued using the last quoted trade or official closing price, provided by independent pricing services as of the close of trading on the market or exchange for which they are primarily traded, on each Fund business day. In the absence of a sale, such securities are valued at the mean of the last bid and ask price provided by independent pricing services. Non-exchange-traded securities for which quotations are available are valued using the last quoted sales price, or in the absence of a sale, at the mean of the last bid and ask prices provided by independent pricing services. Short-term investments that mature in 60 days or less may be valued at amortized cost. Exchange-traded options for which the last quoted sale price is outside the closing bid and ask price, will be valued at the mean of the closing bid and ask price. The Fund values its investments at fair value pursuant to procedures adopted by the Trust's Board of Trustees (the "Board") if (1) market quotations are insufficient or not readily available or (2) the adviser believes that the values available are unreliable. The Trust s Valuation Committee, as defined in the Fund s registration statement, performs certain functions as they relate to the administration and oversight of the Fund s valuation procedures. Under these procedures, the Valuation Committee convenes on a regular and ad-hoc basis to review such investments and considers a number of factors, including valuation methodologies and significant unobservable inputs, when arriving at fair value. The Valuation Committee may work with the adviser to provide valuation inputs. In determining fair valuations, inputs may include market-based analytics which may consider related or comparable assets or liabilities, recent transactions, market multiples, book values and other relevant investment information. Adviser inputs may include an income-based approach in which the anticipated future cash flows of the investment are discounted in determining fair value. Discounts may also be applied based on the nature or duration of any restrictions on the disposition of the investments. The Valuation Committee performs regular reviews of valuation methodologies, key inputs and assumptions, disposition analysis and market activity. Fair valuation is based on subjective factors and, as a result, the fair value price of an investment may differ from the security s market price and may not be the price at which the asset may be sold. Fair valuation could result in a different Net Asset Value ("NAV") than a NAV determined by using market quotes. The Fund has a three-tier fair value hierarchy. The basis of the tiers is dependent upon the various inputs used to determine the value of the Fund s investments. These inputs are summarized in the three broad levels listed below: Level 1 quoted prices in active markets for identical assets and liabilities Level 2 other significant observable inputs (including quoted prices of similar securities, interest rates, prepayment speeds, credit risk, etc.) Level 3 significant unobservable inputs (including the Fund s own assumptions in determining the fair value of investments) The aggregate value by input level, as of February 29, 2016, for the Fund s investments is included in the Fund s Notes to Schedules of Investments and Call and Put Options Written. Security Transactions, Investment Income and Realized Gain and Loss Investment transactions are accounted for on the trade date. Dividend income is recorded on the ex-dividend date. Foreign dividend income is recorded on the ex- 13

NOTES TO FINANCIAL STATEMENTS dividend date or as soon as possible after the Fund determines the existence of a dividend declaration after exercising reasonable due diligence. Income and capital gains on some foreign securities may be subject to foreign withholding taxes, which are accrued as applicable. Interest income is recorded on an accrual basis. Premium is amortized and discount is accreted using the effective interest method. Identified cost of investments sold is used to determine the gain and loss for both financial statement and federal income tax purposes. Written Options When a fund writes an option, an amount equal to the premium received by the fund is recorded as a liability and is subsequently adjusted to the current value of the option written. Premiums received from writing options that expire unexercised are treated by the fund on the expiration date as realized gain from written options. The difference between the premium and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium is less than the amount paid for the closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security in determining whether the fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the fund. The fund, as writer of an option, bears the market risk of an unfavorable change in the price of the security underlying the written option. Written options are non-income producing securities. The values of each individual written option outstanding as of February 29, 2016, are disclosed in the Fund s Schedule of Call and Put Options Written. Transactions in written options during the period ended February 29, 2016, were as follows: Calls Puts Number of Number of Contracts Premiums Contracts Premiums Options Outstanding, August 31, 2015 (7,245) $ (599,513) (7,117) $ (470,795) Options written (32,913) (3,385,120) (29,448) (2,316,390) Options terminated in closing transactions 9,105 982,397 7,357 522,599 Options exercised 4,555 547,458 3,276 268,470 Options expired 19,054 1,753,276 18,734 1,386,829 Options Outstanding, February 29, 2016 (7,444) $ (701,502) (7,198) $ (609,287) Distributions to Shareholders Distributions to shareholders of net investment income, if any, are declared and paid at least quarterly. Distributions to shareholders of net capital gains, if any, are declared and paid at least annually. Distributions to shareholders are recorded on the ex-dividend date. Distributions are based on amounts calculated in accordance with applicable federal income tax regulations, which may differ from GAAP. These differences are due primarily to differing treatments of income and gain on various investment securities held by the Fund, timing differences and differing characterizations of distributions made by the Fund. Federal Taxes The Fund intends to continue to qualify each year as a regulated investment company under Subchapter M of the Internal Revenue Code and to distribute all of its taxable income to shareholders. In addition, by distributing in each calendar year substantially all of its net investment income and capital gains, if any, the Fund will not be subject to a federal excise tax. Therefore, no federal income or excise tax provision is required. The Fund files a U.S. federal income and excise tax return as required. A fund s federal income tax returns are subject to examination by the Internal Revenue Service for a period of three fiscal years after they are filed. As of February 29, 2016, there are no uncertain tax positions that would require financial statement recognition, de-recognition or disclosure. Income and Expense Allocation The Trust accounts separately for the assets, liabilities and operations of each of its investment portfolios. Expenses that are directly attributable to more than one investment portfolio are allocated among the respective investment portfolios in an equitable manner. The Fund s class-specific expenses are charged to the operations of that class of shares. Income and expenses (other than expenses attributable to a specific class) and realized and unrealized gains or losses on investments are allocated to each class of shares based on the class respective net assets to the total net assets of the Fund. Commitments and Contingencies In the normal course of business, the Fund enters into contracts that provide general indemnifications by the Fund to the counterparty to the contract. The Fund s maximum exposure under these arrangements is dependent on future claims that may be made against the Fund and, therefore, cannot be estimated; however, the risk of loss from such claims is considered remote. Note 3. Fees and Expenses Investment Adviser MAI Capital Management, LLC, (the Adviser ) is the investment adviser to the Fund. Pursuant to 14

NOTES TO FINANCIAL STATEMENTS an investment advisory agreement, the Adviser receives an advisory fee from the Fund at an annual rate of 0.75% of the Fund s average daily net assets. Distribution Foreside Fund Services, LLC serves as the Fund s distributor (the Distributor ). The Distributor is not affiliated with the Adviser or Atlantic Fund Administration, LLC (d/b/a Atlantic Fund Services) ( Atlantic ) or their affiliates. The Fund has adopted a Distribution Plan (the Plan ) for Investor Class shares in accordance with Rule 12b-1 of the Act. Under the Plan, the Fund pays the Distributor and/or any other entity as authorized by the Board a fee of up to 0.25% of the average daily net assets of Investor Class. Other Service Providers Atlantic provides fund accounting, fund administration, compliance and transfer agency services to the Fund. Atlantic also provides certain shareholder report production, and EDGAR conversion and filing services. Pursuant to an Atlantic services agreement, the Fund pays Atlantic customary fees for its services. Atlantic provides a Principal Executive Officer, a Principal Financial Officer, a Chief Compliance Officer, and an Anti-Money Laundering Officer to the Fund, as well as certain additional compliance support functions. Trustees and Officers The Trust pays each independent Trustee an annual retainer fee of $50,000 for service to the Trust ($66,000 for the Chairman). The Audit Committee Chairman and Vice Chairman receive an additional $6,000 annually. The Trustees and Chairman may receive additional fees for special Board meetings. Each Trustee is also reimbursed for all reasonable out-of-pocket expenses incurred in connection with his duties as a Trustee, including travel and related expenses incurred in attending Board meetings. The amount of Trustees fees attributable to the Fund is disclosed in the Statement of Operations. Certain officers of the Trust are also officers or employees of the above named service providers, and during their terms of office received no compensation from the Fund. Note 4. Expense Reimbursements and Fees Waived The Adviser has contractually agreed to waive its fees and/or reimburse expenses through January 1, 2017, to the extent necessary to maintain the total operating expenses (excluding other expenses, taxes, leverage interest, acquired fund fees and expenses, dividends or interest on short positions, other interest expenses, brokerage commissions, and extraordinary expenses such as litigation) at 0.99% and 1.24%, of the Institutional Class and Investor Class, respectively. The contractual waivers may be changed or eliminated at any time with consent of the Board. During the period ended February 29, 2016, fees waived and expenses reimbursed were $83,367. The Fund may pay the Adviser for fees waived and expenses reimbursed pursuant to the expense cap if (1) such payment is made within three years of the fees waived or expense reimbursement and (2) the resulting expenses do not exceed 0.99% and 1.24%, of the Institutional Class and Investor Class, respectively. As of February 29, 2016, the amount of waived fees and reimbursed expenses subject to recapture by the Adviser are as follows: Amount of Fees Waived and/or Expenses Reimbursed Expiration Date to Recoup Fees Waived and/or Expenses Reimbursed Fees Recouped August 31, 2013 $ 153,539 August 31, 2016 $ - August 31, 2014 $ 153,301 August 31, 2017 $ - August 31, 2015 $ 137,388 August 31, 2018 $ - February 29, 2016 $ 83,367 August 31, 2019 $ - Note 5. Security Transactions The cost of purchases and proceeds from sales of investment securities (including maturities), other than short-term investments during the period ended February 29, 2016, were $33,906,268 and $30,053,605, respectively. Note 6. Summary of Derivative Activity The volume of open derivative positions may vary on a daily basis as the Fund transacts derivative contracts in order to achieve the exposure desired by the Adviser. The notional value of activity for the period ended February 29, 2016 for any derivative type that was held during the period is as follows: Written Options $ (5,701,510) The Fund s use of derivatives during the period ended February 29, 2016, was limited to written options. 15

NOTES TO FINANCIAL STATEMENTS Following is a summary of the effect of derivatives on the Statement of Assets and Liabilities as of February 29, 2016: Location Equity Contracts Liability derivatives: Call options written, at value $ (684,584) Put options written, at value (403,915) Total liability derivatives $ (1,088,499) Realized and unrealized gains and losses on derivatives contracts during the period ended February 29, 2016, by the Fund are recorded in the following locations on the Statement of Operations: Location Equity Contracts Net realized gain (loss) on: Written options $ 2,392,356 Net change in unrealized appreciation (depreciation) on: Written options $ 495,765 Asset (Liability) amounts shown in the table below represent amounts for derivative related investments at February 29, 2016. These amounts may be collateralized by cash or financial instruments. Gross Asset (Liability) as Presented in the Statement of Assets and Liabilities Financial Instruments (Received) Pledged** Cash Collateral (Received) Pledged** Net Amount Liabilities: Over-the-counter derivatives* $ (1,088,499) $ 1,088,499 $ - $ - * Over-the-counter derivatives may consist of written options contracts. The amounts disclosed above represent the exposure to one or more counterparties. For further detail on individual derivative contracts and the corresponding unrealized appreciation (depreciation), see the Schedule of Call and Put Options Written. ** The actual financial instruments and cash collateral (received) pledged may be in excess of the amounts shown in the table. The table only reflects collateral amounts up to the amount of the financial instrument disclosed on the Statement of Assets and Liabilities. Note 7. Federal Income Tax As of August 31, 2015, distributable earnings (accumulated loss) on a tax basis were as follows: Undistributed Ordinary Income $ 3,315,408 Undistributed Long-Term Gain 77,549 Unrealized Depreciation (6,507,004) Total $ (3,114,047) The difference between components of distributable earnings on a tax basis and the amounts reflected in the Statement of Assets and Liabilities are primarily due to temporary book/tax differences relating to real estate investment trusts, partnerships, wash sales and straddles. Note 8. Underlying Investment in Other Investment Companies The Fund currently meets the collateral requirements of a tri-party agreement between the prime broker, custodian and the Fund by investing a portion of its assets in the Fidelity Institutional Money Market Fund and holding the shares in a segregated account pledged to the prime broker. The performance of the Fund may be directly affected by the performance of the Fidelity Institutional Money Market Fund. As of February 29, 2016, the percentage of net assets invested in the Fidelity Institutional Money Market Fund was 43.4%. The latest financial statements for the Fidelity Institutional Money Market Fund can be found at www.sec.gov. 16

NOTES TO FINANCIAL STATEMENTS Note 9. Subsequent Events Subsequent events occurring after the date of this report through the date these financial statements were issued have been evaluated for potential impact and the Fund has had no such events. 17

ADDITIONAL INFORMATION Investment Advisory Agreement Approval At the September 11, 2015 Board meeting, the Board, including the Independent Trustees, considered the approval of the continuance of the investment advisory agreement between the Adviser and the Trust pertaining to the Fund (the Advisory Agreement ). In preparation for its deliberations, the Board requested and reviewed written responses from the Adviser to a due diligence questionnaire circulated on the Board's behalf concerning the Adviser s personnel, operations, financial condition, performance, and services provided by the Adviser. The Board also discussed the materials with Fund Counsel and, as necessary, with the Trust's administrator, Atlantic Fund Services. During its deliberations, the Board received an oral presentation from the Adviser, and was assisted by the advice of Trustee Counsel. At the meeting, the Board reviewed, among other matters: (1) the nature, extent and quality of the services provided to the Fund by the Adviser, including information on the investment performance of the Fund and the Adviser; (2) the costs of the services provided and profitability to the Adviser of its relationship with the Fund; (3) the advisory fee and total expense ratio of the Fund compared to a relevant peer group of funds; (4) the extent to which economies of scale may be realized as the Fund grows and whether the advisory fee enables each Fund's investors to share in the benefits of economies of scale; and (5) other benefits received by the Adviser from its relationship with the Fund. Nature, Extent and Quality of Services Based on written materials received, a presentation from senior representatives of the Adviser and a discussion with the Adviser about the Adviser s personnel, operations and financial condition and with the Trust s CCO about the Adviser, the Board considered the quality of services provided by the Adviser under the Advisory Agreement. In this regard, the Board considered information regarding the experience, qualifications and professional background of the portfolio manager and other personnel at the Adviser with principal responsibility for the Fund, as well as the investment philosophy and decisionmaking process of those professionals and the capability and integrity of the Adviser s senior management and staff. The Board considered also the adequacy of the Adviser s resources. The Board noted the Adviser s representation that the firm is financially stable and that the Adviser s financial condition will not impair its ability to provide high-quality advisory services to the Fund. Based on the presentation and the materials provided by the Adviser in connection with the Board s consideration of the renewal of the Advisory Agreement, the Board concluded that, overall, it was satisfied with the nature, extent and quality of services to be provided to the Fund under the Advisory Agreement. Performance In connection with a presentation by the Adviser regarding its approach to managing the Fund, the Board reviewed the performance of the Fund compared to its benchmark. The Board observed that the Fund underperformed the S&P 500 Index, the primary benchmark for the Fund, for the one-year and three-year periods ended June 30, 2015. The Board also considered the Fund s performance relative to its Lipper peer group, noting that, based on the information provided by Lipper, the Fund underperformed the median of its Lipper peer group for the one-year and three-year periods ended June 30, 2015. The Board noted the Adviser s representation that the Fund s underperformance over these periods relative to its benchmark and Lipper peers was attributable primarily to the Fund s positions in dividend growth stocks, a category of securities that had performed less well than the general market. In addition, the Board noted the Adviser s representation that the Fund s strategy was designed to provide capital appreciation over the long term and that the Fund s strategy was designed to perform better in downward trending, volatile markets than in the type of market experienced in 2014 and, in return, potentially trail in rising markets. The Board noted further the Adviser s representation that the Fund actually performed better on a risk-adjusted basis than most funds in the Lipper peer group. Based on the foregoing, the Board determined that the Fund s performance was reasonable and that the Fund and its shareholders could benefit from the Adviser s continued management of the Fund. Compensation The Board evaluated the Adviser s compensation for providing advisory services to the Fund and analyzed comparative information on actual advisory fee rates (i.e., after fee waivers) and actual total expenses of the Fund s Lipper peer group. The Board noted that the Adviser s actual advisory fee rate and actual total expense ratio for the Fund were each lower than the median of its Lipper peers. In addition, the Board noted the Adviser s representation that the Fund receives a discount from the Adviser s standard fee schedule in order to keep the overall expense ratio at a level that the Adviser believes is advantageous to asset accumulation. The Board noted that the Adviser has contractually agreed to cap the Fund s total expenses (excluding taxes, leverage interest, acquired fund fees and expenses, dividend or interest on short positions, other interest expenses, brokerage commissions, and extraordinary expenses) at 1.24% and 0.99% per annum for Investor Class shares and Institutional Class shares, respectively, through January 1, 2017. Based on the foregoing, the Board concluded that the Adviser s advisory fee rate charged to the Fund was reasonable. 18