# EDGAR Filing Document

**Accession Number:** 0001618627
**File Stem:** 0001398344-23-000213
**Filing Date:** 2023-1
**Character Count:** 625487
**Document Hash:** 0b2cc4306ad7112eab30ad808140f0a0
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001398344-23-000213.hdr.sgml**: 20230105

**ACCESSION NUMBER**: 0001398344-23-000213

**CONFORMED SUBMISSION TYPE**: 497

**PUBLIC DOCUMENT COUNT**: 25

**FILED AS OF DATE**: 20230105

**DATE AS OF CHANGE**: 20230105

**EFFECTIVENESS DATE**: 20230105

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** RBB Fund Trust
- **CENTRAL INDEX KEY:** 0001618627
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 0831

**FILING VALUES:**
- **FORM TYPE:** 497
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-200168
- **FILM NUMBER:** 23510551

**BUSINESS ADDRESS:**
- **STREET 1:** 615 EAST MICHIGAN STREET
- **CITY:** MILWAUKEE
- **STATE:** WI
- **ZIP:** 53202
- **BUSINESS PHONE:** 609-731-6256

**MAIL ADDRESS:**
- **STREET 1:** 615 EAST MICHIGAN STREET
- **CITY:** MILWAUKEE
- **STATE:** WI
- **ZIP:** 53202

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** PENN Capital Funds Trust
- **DATE OF NAME CHANGE:** 20140904

## Series and Classes Contracts Data

### Penn Capital Mid Cap Core Fund (Series ID: S000048026)

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|  |  |  |
|:---|:---|:---|
| Class Name          | Ticker Symbol | Class ID   |
| Institutional Class | PSMPX         | C000151486 |

---

### Penn Capital Special Situations Small Cap Equity Fund (Series ID: S000048027)

---

|  |  |  |
|:---|:---|:---|
| Class Name          | Ticker Symbol | Class ID   |
| Institutional Class | PSCNX         | C000151488 |

---

### Penn Capital Opportunistic High Income Fund (Series ID: S000048028)

---

|  |  |  |
|:---|:---|:---|
| Class Name          | Ticker Symbol | Class ID   |
| Institutional Class | PHYNX         | C000151490 |

---

### Penn Capital Floating Rate Income Fund (Series ID: S000048029)

---

|  |  |  |
|:---|:---|:---|
| Class Name          | Ticker Symbol | Class ID   |
| Institutional Class | PFRNX         | C000151492 |

---

### Penn Capital Short Duration High Income Fund (Series ID: S000058052)

---

|  |  |  |
|:---|:---|:---|
| Class Name          | Ticker Symbol | Class ID   |
| Institutional Class | PSHNX         | C000190040 |

---

## Series and Classes Contracts Data

### Penn Capital Mid Cap Core Fund (Series ID: S000048026)

| Class ID   | Class Name          | Ticker Symbol   |
|:---|:---|:---|
| C000151486 | Institutional Class | PSMPX           |

### Penn Capital Special Situations Small Cap Equity Fund (Series ID: S000048027)

| Class ID   | Class Name          | Ticker Symbol   |
|:---|:---|:---|
| C000151488 | Institutional Class | PSCNX           |

### Penn Capital Opportunistic High Income Fund (Series ID: S000048028)

| Class ID   | Class Name          | Ticker Symbol   |
|:---|:---|:---|
| C000151490 | Institutional Class | PHYNX           |

### Penn Capital Floating Rate Income Fund (Series ID: S000048029)

| Class ID   | Class Name          | Ticker Symbol   |
|:---|:---|:---|
| C000151492 | Institutional Class | PFRNX           |

### Penn Capital Short Duration High Income Fund (Series ID: S000058052)

| Class ID   | Class Name          | Ticker Symbol   |
|:---|:---|:---|
| C000190040 | Institutional Class | PSHNX           |

?xml version="1.0" encoding="utf-8"?

![](fp0081157-1_01.jpg)

Prospectus

December 31, 2022

**Penn Capital Floating Rate Income Fund**

Institutional Class (Ticker: PFRNX)

**Penn Capital Short Duration High Income Fund**

Institutional Class (Ticker: PSHNX)

**Penn Capital Opportunistic High Income Fund**

Institutional Class (Ticker: PHYNX)

**Penn Capital Mid Cap Core Fund**

Institutional Class (Ticker: PSMPX)

**Penn Capital Special Situations Small Cap Equity Fund**

Institutional Class (Ticker: PSCNX)

**LIKE ALL MUTUAL FUNDS, THE U.S. SECURITIES AND EXCHANGE COMMISSION (THE "SEC") HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.**

**Table of Contents**

---

| | |
|:---|:---|
| SUMMARY SECTIONS | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Penn Capital Floating Rate Income Fund | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Penn Capital Short Duration High Income Fund | 8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Penn Capital Opportunistic High Income Fund | 16 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Penn Capital Mid Cap Core Fund | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Penn Capital Special Situations Small Cap Equity Fund | 30 |
| MORE INFORMATION ABOUT THE FUNDS | 36 |
| PRINCIPAL RISKS | 42 |
| MANAGEMENT OF THE FUNDS | 51 |
| INSTITUTIONAL CLASS OF SHARES | 55 |
| HOW TO BUY, SELL, EXCHANGE AND TRANSFER SHARES | 57 |
| ADDITIONAL INFORMATION REGARDING PURCHASES AND REDEMPTIONS | 62 |
| DIVIDENDS, DISTRIBUTIONS, AND TAXES | 63 |
| FINANCIAL HIGHLIGHTS | 66 |
| PRIVACY POLICY |  |
| FOR MORE INFORMATION |  |

---

i

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**SUMMARY SECTIONS**

**Penn Capital Floating Rate Income Fund**

**Investment Objective**

The Penn Capital Floating Rate Income Fund (the "Fund") seeks to provide current income.

**Fees and Expenses**

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund.

---

| | |
|:---|:---|
| **Shareholder Fees** (fees paid directly from your investment) | Institutional Class |
| Maximum Sales Charge (Load) Imposed on Purchases | None |
| Maximum Deferred Sales Charge (Load) (as a percentage of the original purchase price) | None |
| Maximum Sales Charge (Load) Imposed on Reinvested Dividends | None |

---

---

| | |
|:---|:---|
| **Annual Fund Operating Expenses**<br> (expenses that you pay each year as a percentage of the value of your investment) |  |
| Management Fees | 0.55% |
| Distribution and/or Service (12b-1) Fees | 0.00% |
| Other Expenses | 0.56% |
| Total Annual Fund Operating Expenses | 1.11% |
| Less Fee Waiver and/or Expense Reimbursement<sup>(1)</sup> | -0.47% |
| Total Annual Fund Operating Expenses (After Fee Waiver/Expense Reimbursement)<sup>(1)</sup> | 0.64% |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) The
 RBB Fund Trust (the "Trust") and Penn Capital Management Company, LLC (the
 "Advisor"), have entered into an expense limitation agreement under which
 the Advisor has agreed to waive management fees and/or pay Fund expenses to the extent
 necessary so that the Fund's total annual operating expenses (excluding any acquired
 fund fees and expenses, taxes, interest, brokerage fees, certain insurance costs, and
 extraordinary and other non-routine expenses) through the period ending December 31,
 2023 , do not exceed 0.64% for Institutional Class shares. Under the agreement, the Advisor
 is entitled to be reimbursed by the Fund for any fees it waived and expenses it paid
 for a period of three years following the month of the fee waiver or payment, to the
 extent such reimbursement will not cause the Fund to exceed any applicable expense limit
 that was in place when the fees were waived or expenses paid. The expense limitation
 agreement may be terminated by the Board of Trustees (the "Board" or "Trustees")
 at any time and also will terminate automatically upon the expiration or termination
 of the Fund's advisory contract with the Advisor.

**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 and then hold or redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year, that the Fund's operating expenses remain the same, and that the expense limitation applies only for the first year. Although your actual costs may be higher or lower, based on these assumptions your cost would be:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Years** | **5 Years** | **10 Years** |
| Institutional Class | $65 | $306 | $566 | $1310 |

---

**Portfolio Turnover**

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the fiscal year ended August 31, 2022, the portfolio turnover rate for the Fund was 49% of the average value of its portfolio.

**Principal Investment Strategies**

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in floating rate senior secured loans, floating rate senior corporate debt and other floating rate senior instruments. The loans and instruments in which the Fund invests include bank loans (including covenant lite loans), bonds, and debt securities issued by various domestic and foreign entities. The Fund also invests in private placements in these types of securities. The Fund intends to invest in instruments that are U.S. dollar denominated. The Fund may invest up to 25% of its net assets in foreign debt instruments. The Fund intends to invest primarily in below-investment grade loans and instruments, including debt obligations issued by real estate investment trusts ("REITs"), bonds, notes and debentures, but may also invest in investment grade loans and instruments. Below-investment grade debt instruments (commonly called "high yield" or "junk" bonds) are those instruments rated BB+ or lower by S&P Global Ratings ("S&P") or Fitch Ratings, Inc. ("Fitch"), or Ba1 or lower by Moody's Investors Service, Inc. ("Moody's"), or comparably rated by another nationally recognized statistical rating organization, or, if unrated, determined by the Advisor to be of comparable quality. The Advisor seeks to pursue a conservative (defensive) investment strategy within the high yield debt market by generally avoiding the lowest rated (*i.e.*, riskiest) debt instruments in the high yield market. The Fund is permitted to invest in instruments of any maturity. The Fund may invest up to 10% of its net assets in subordinated loans. In addition, the Fund may have increased exposure to investments in the financials sector. The Fund also is permitted to invest in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund also invests in other investment companies, including exchange traded funds ("ETFs"), that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein.

In selecting investments for the Fund, the Advisor incorporates environmental, social, and governance-related ("ESG") issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

The Fund's investments in senior floating rate loans will be through syndicated loans. Syndicated loans are an extension of credit provided by a group of lenders and are structured, arranged, syndicated and administered by one or more banks. A syndicated bank loan is purchased either via "assignment" or "participation". When a loan is purchased via assignment, the buyer is approved by the borrower and becomes the legal lender of record. When a loan is purchased via participation, the buyer receives the right to repayment but is not the legal lender of record. Most loans acquired by the Fund will be via assignment.

Loan coupons are typically "floating" rate. Floating rate securities generally pay interest at rates that adjust whenever a specified interest rate changes and/or is reset on predetermined dates (such as the last day of a month or calendar quarter). Floating rate coupons have historically been set using the London Inter-Bank Offered Rate ("LIBOR") plus the spread (i.e., the rate for such coupons will typically be a spread or margin over LIBOR). The coupon determines the periodic interest payment that the loan holder will receive. Some loans contain a "LIBOR Floor," which sets a minimum level on which to base the calculation of the coupon. Other loans do not contain a LIBOR Floor, and those coupons typically will be the sum of the 3-month market rate of LIBOR plus the spread. Coupons usually reset quarterly based upon the prevailing LIBOR rate. At the end of 2021, certain LIBOR rates were discontinued and an increasing number of floating rate coupons are being set using the Secured Overnight Financing Rate ("SOFR") plus a spread (i.e., the rate for such coupons will typically be a spread or margin over SOFR). Coupons are expected to be consistent with respect to the rate used (e.g., LIBOR or SOFR). Refer to "Principal Investment Risks - LIBOR Transition Risk."

The Fund may invest in "covenant lite" loans. Certain financial institutions may define "covenant lite" loans differently. Covenant lite loans may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan that has fewer restrictions typically does not include the legal clauses which allow an investor to proactively enforce financial tests or prevent or restrict undesired actions taken by the company or sponsor. Covenant lite loans also generally give the borrower/issuer more flexibility if they have met certain loan terms and provide fewer investor protections if certain criteria are breached.

The Advisor could choose to sell a particular security if, for example, it no longer satisfies specific criteria based on the quantitative and qualitative factors outlined above, or to take advantage of what the Advisor has determined to be a better investment opportunity.

**Principal Investment Risks**

As with all mutual funds, there is the risk that you could lose all or a portion of your investment in the Fund. An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation ("FDIC") or any other government agency. The following principal risks could affect the value of your investment and the Fund's performance:

• **Bank Loan Risk.** There are a number of risks associated with an investment in floating
 rate senior secured bank loans, including credit risk, interest rate risk, liquidity
 risk and prepayment risk. Lack of an active trading market, restrictions on resale, irregular
 trading activity, wide bid/ask spreads and extended trade settlement periods in excess
 of seven days all would likely impair the Fund's ability to sell bank loans within
 its desired time frame or at an acceptable price and its ability to accurately value
 existing and prospective investments. Extended trade settlement periods may result in
 cash not being immediately available to the Fund. As a result of such illiquidity, the
 Fund may have to sell other investments or engage in borrowing transactions to raise
 cash to meet its obligations.

Bank loans in which the Fund invests have similar risks to below investment grade fixed income securities. Changes in the financial condition of the borrower or economic conditions or other circumstances could reduce the capacity of the borrower to make principal and interest payments on such instruments and may lead to defaults. Secured bank loans are supported by collateral; however, the value of the collateral may be insufficient to cover the amount owed to the Fund. If the Fund relies on a third party to administer a loan, the Fund is subject to the risk that the third party will fail to perform its obligations. In addition, if the Fund holds only a participation interest in a loan made by a third party, the Fund's receipt of payments on the loan will be dependent on the third party's willingness and ability to make those payments to the Fund.

Loans generally are subject to legal or contractual restrictions on resale. The liquidity of loans, including the volume and frequency of secondary market trading in such loans, varies significantly over time and among individual loans. For example, if the credit quality of a loan unexpectedly declines significantly, secondary market trading in that loan can also decline for a period of time. During periods of infrequent trading, valuing a loan can be more difficult and buying and selling a loan at an acceptable price can be more difficult and delayed. Difficulty in selling a loan can result in a loss. Due to their subordination in the borrower's capital structure, subordinated loans involve a higher degree of overall risk than senior bank loans of the same borrower.

A significant portion of bank loans may be "covenant lite" loans that may contain fewer or less restrictive constraints on the borrower or other borrower-friendly characteristics. The Fund may experience relatively greater realized or unrealized losses or delays in enforcing its rights on its holdings of certain covenant lite loans than its holdings of loans with the usual covenants.

• **Credit Risk.** Credit risk refers to the possibility that the issuer of the security or a
 counterparty in respect of a derivative instrument will not be able to satisfy its payment
 obligations to the Fund when due. Changes in an issuer's credit rating or the market's
 perception of an issuer's creditworthiness may also affect the value of the Fund's
 investment in that issuer. Securities rated in the four highest categories by the rating
 agencies are considered investment grade but they may also have some speculative characteristics.
 Investment grade ratings do not guarantee that bonds will not lose value or default.
 In addition, the credit quality of securities may be lowered if an issuer's financial
 condition changes. The Fund could also be delayed or hindered in its enforcement of rights
 against an issuer, guarantor, or counterparty.

• **Debt/Fixed Income Securities Risk.** The values of fixed income securities typically will decline
 during periods of rising interest rates, and can also decline in response to changes
 in the financial condition of the issuer, borrower, counterparty, or underlying collateral
 assets, or changes in market, economic, industry, political, and regulatory conditions
 affecting a particular type of security or issuer or fixed income securities generally.
 Fixed income securities are generally subject to interest rate risk, prepayment/extension
 risk, and credit risk.

• **Leveraged Companies Risk.** Securities of leveraged companies tend to be more sensitive to issuer,
 political, market and economic developments than the market as a whole and the securities
 of other types of companies. A decrease in the credit quality of a leveraged company
 can lead to a significant decrease in the value of the company's securities. In
 the event of liquidation or bankruptcy, a company's creditors take precedence over
 the company's stockholders. Leveraged companies can have limited access to additional
 capital.

• **Liquidity Risk.** Certain securities may be difficult (or impossible) to sell at the time and
 at the price the Advisor would like. As a result, the Fund may have to hold these securities
 longer than it would like and may forego other investment opportunities. There is the
 possibility that the Fund may lose money or be prevented from realizing capital gains
 if it cannot sell a security at a particular time and price. Liquid portfolio investments
 may become illiquid or less liquid after purchase by the Fund due to low trading volume,
 adverse investor perceptions and/or other market developments. Liquidity risk includes
 the risk that the Fund will experience significant net redemptions at a time when it
 cannot find willing buyers for its portfolio securities or can only sell its portfolio
 securities at a material loss. Liquidity risk can be more pronounced in periods of market
 turmoil. It may be more difficult for the Fund to determine an accurate good faith fair
 value of an illiquid investment than that of a more liquid comparable investment. If
 the Fund sells investments with extended settlement times, such as loans, the settlement
 proceeds from the sales may not be available to meet the Fund's redemption obligations
 for a substantial period of time.

• **Redemption Risk.** The Fund may need to sell securities at times it would not otherwise do so
 in order to meet shareholder redemption requests. Selling securities to meet such redemptions
 could cause the Fund to experience a loss, increase the Fund's transaction costs,
 or have tax consequences. To the extent that a large shareholder invests, the Fund may
 experience relatively large redemptions if such shareholder reallocates its assets.

• **Market Risk.** The value of the Fund's portfolio securities may decline, at times sharply
 and unpredictably, as a result of unfavorable market-induced changes affecting particular
 industries, sectors, or issuers. The Fund is subject to risks affecting issuers, such
 as management performance, financial leverage, industry problems, and reduced demand
 for goods or services.

• **High Yield Securities Risk.** High yield securities and unrated securities of similar credit
 quality, commonly known as "junk" bonds, have speculative characteristics
 and involve greater volatility of price and yield, greater risk of loss of principal
 and interest, a greater level of liquidity risk, and generally reflect a greater possibility
 of an adverse change in financial condition that could affect an issuer's ability
 to honor its obligations.

• **Prepayment/Extension Risk.** In connection with the Fund's investments in fixed income securities,
 the Fund may be forced to invest in securities with lower yields and thus reducing its
 income if issuers prepay certain fixed income securities. Issuers may decrease prepayments
 of principal when interest rates increase, extending the average life and duration of
 a fixed income security and causing the value of the security to decline.

• **Volatility Risk.** The value of securities in the Fund's portfolio may go down. The Fund's
 portfolio will reflect changes in the prices of individual portfolio securities or general
 changes in securities valuations. Consequently, the Fund's share price may decline
 and you could lose money.

• **Income Risk.** Income risk is the possibility that the Fund's income will decline because
 of falling interest rates.

• **LIBOR Transition Risk.** Many financial instruments may be tied to the London Interbank Offered
 Rate, or "LIBOR," to determine payment obligations, financing terms, hedging
 strategies, or investment value. In July 2017, the Financial Conduct Authority, the United
 Kingdom's financial regulatory body, announced that after 2021 it would cease its
 active encouragement of banks to provide quotations needed to sustain LIBOR. The publication
 of LIBOR on a representative basis ceased for the one-week and two-month U.S. dollar
 LIBOR settings immediately after December 31, 2021, and it is expected to cease for the
 remaining U.S. dollar LIBOR settings immediately after June 30, 2023. Any potential effects
 of the transition away from LIBOR on the Fund or on certain instruments in which the
 Fund invests can be difficult to determine, and they may vary depending on factors that
 include, but are not limited to, (i) existing fallback or termination provisions in individual
 contracts and (ii) whether, how, and when industry participants develop and adopt new
 reference rates and fallbacks for both legacy and new products and instruments. The transition
 process may involve, among other things, increased volatility or illiquidity in markets
 for instruments that currently rely on LIBOR, and there may be a reduction in the value
 of certain instruments held by the Fund.

• **Rating Agencies Risk.** The value of your investment in the Fund may change in response to
 changes in the credit ratings of the Fund's portfolio securities. Generally, investment
 risk and price volatility increase as a security's credit rating declines. Ratings
 are not an absolute standard of quality, but rather general indicators that reflect only
 the view of the originating rating agencies from which an explanation of the significance
 of such ratings may be obtained. There is no assurance that a particular rating will
 continue for any given period of time or that any such rating will not be revised downward
 or withdrawn entirely if, in the judgment of the agency establishing the rating, circumstances
 so warrant. A downward revision or withdrawal of such ratings, or either of them, could
 affect the liquidity or market price of the securities in which the Fund invests. The
 ratings of securitized assets may not adequately reflect the credit risk of those assets
 due to their structure.

• **Agent Insolvency Risk.** In a syndicated loan, the agent bank is the bank in the syndicate
 that undertakes the bulk of the administrative duties involved in the day-to-day administration
 of the loan. In the event of the insolvency of an agent bank, a loan could be subject
 to settlement risk as well as the risk of interruptions in the administrative duties
 performed in the day to day administration of the loan.

• **Management Risk.** The Fund may not meet its investment objective based on the Advisor's
 success or failure to implement the Fund's investment strategies.

• **ETF Risk.** The Fund's investment in ETFs may subject the Fund to additional risks than
 if the Fund would have invested directly in the ETF's underlying securities. These risks
 include the possibility that an ETF may trade at a discount to the aggregate value of
 the underlying securities and although expense ratios for ETFs are generally low, frequent
 trading of ETFs by the Fund can generate brokerage expenses. In addition, because ETFs
 are listed on national stock exchanges and are traded like stocks listed on an exchange,
 (1) the Fund may acquire ETF shares at a discount or premium to their net asset value
 per share ("NAV") and (2) ETFs are subject to brokerage and other trading
 costs, which could result in greater expenses to the Fund. Trading of ETFs may be halted
 by the activation of individual or market wide trading halts, or if the ETFs are delisted
 from an exchange. Shareholders will indirectly be subject to the fees and expenses of
 the ETFs in which the Fund invests.

• **Private Placement Risk.** The Fund invests in privately issued securities, including those
 which may be resold only in accordance with Rule 144A under the Securities Act of
 1933, as amended. Privately issued securities are restricted securities that are not
 registered with the U.S. Securities and Exchange Commission ("SEC"). Accordingly,
 the liquidity of the market for specific privately issued securities may vary. Delay
 or difficulty in selling such securities may result in a loss to the Fund. Privately
 issued securities that the Advisor determines to be "illiquid" are subject
 to the Fund's policy of not investing more than 15% of its net assets in illiquid
 investments.

• **Interest Rate Risk.** An increase in interest rates may cause a fall in the value of the fixed
 income securities in which the Fund may invest. Declines in value are greater for fixed
 income securities, as well as funds, with longer maturities or durations. Duration measures
 the sensitivity of a security's price to changes in interest rates. This measure
 incorporates a security's coupon, maturity, and call features, among other factors.

• **Financials Sector Risk.** Performance of companies in the financials sector may be adversely impacted
 by many factors, including, among others, government regulations, economic conditions,
 credit rating downgrades, changes in interest rates, and decreased liquidity in credit
 markets. The impact of more stringent capital requirements, recent or future regulation
 of any individual financial company or of the financials sector as a whole cannot be
 predicted. In recent years, cyber attacks and technology malfunctions and failures have
 become increasingly frequent in this sector and have caused significant losses to companies
 in this sector, which may negatively impact the Fund.

• **Foreign Currency Risk.** The U.S. dollar value of foreign investments may be negatively affected
 by changes in foreign (non-U.S.) currency rates. Currency exchange rates may fluctuate
 significantly over short periods of time.

• **REIT Risk.** Debt securities issued by REITs are, for the most part, general and unsecured
 obligations and are subject to risks associated with REITs. A REIT's performance
 depends on the types, values and locations of the properties it owns and how well those
 properties are managed. Because a REIT may be invested in a limited number of projects
 or in a particular market segment, it may be more susceptible to adverse developments
 affecting a single project or market segment than more broadly diversified investments.
 The risk of defaults is generally higher in the case of mortgage pools that include subprime
 mortgages (which refer to loans made to borrowers with weakened credit histories or with
 a lower capacity to make timely payments, and second-lien mortgage loans), and a decline
 in or flattening of property values also may exacerbate losses. Loss of status as a qualified
 REIT under the U.S. federal tax laws could adversely affect the value of a particular
 REIT or the market for REITs as a whole.

• **Maturity Risk.** Generally, a bond with a longer maturity will entail greater interest rate
 risk but have a higher yield. Conversely, a bond with a shorter maturity will entail
 less interest rate risk but have a lower yield.

• **Foreign Securities Risk.** Investing in foreign securities typically involves more risks than
 investing in U.S. securities, including risks related to currency exchange rates and
 policies, country or government specific issues, less favorable trading practices or
 regulation and greater price volatility. Certain of these risks also may apply to securities
 of U.S. companies with significant foreign operations.

• **Investments in Other Investment Companies Risk.** The Fund's investment performance is affected
 by the investment performance of the underlying funds in which the Fund may invest. Shareholders
 will indirectly be subject to the fees and expenses of the other investment companies
 and these fees and expenses are in addition to the fees and expenses that Fund shareholders
 directly bear in connection with the Fund's own operations. In addition, shareholders
 will be indirectly subject to the investment risks of the other investment companies.

• **ESG Investing Risk.** ESG investing risk is the risk stemming from the ESG factors that
 the Fund may apply in selecting securities. This may affect the Fund's exposure
 to certain companies or industries and cause the Fund to forego certain investment opportunities.
 As a result, the Fund may invest in companies that do not reflect the beliefs and values
 of any particular investor. Investors may differ in their views of ESG characteristics.
 The Fund's returns may be lower than other funds that do not use ESG ratings.

**Performance Information**

The following bar chart and table provide some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund's Institutional Class shares has varied from year to year. The table shows how the average annual total returns of the Fund's Institutional Class Shares for various periods compare with those of the Credit Suisse Institutional Leveraged Loan Index and the Morningstar LSTA US Leverage Loan BB Rated Loan Index, each a broad measure of market performance. The Fund's past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Updated performance information is available online at <u>www.penncapitalfunds.com</u> or by calling 1-844-302-PENN (7366).

**Institutional Class Shares** 

**Calendar Year Returns as of December 31**

![](fp0081157-1_02.jpg)

The Fund's calendar year-to-date return as of September 30, 2022 was -4.15%. During the period shown in the bar chart, the highest return for a calendar quarter was 7.18% (quarter ended June 30, 2020), and the lowest return for a calendar quarter was -11.39% (quarter ended March 31, 2020).

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| | | | |
|:---|:---|:---|:---|
| *Average Annual Total Returns*<br> (for the Periods Ended December 31, 2021) |  |  | <br>|
|  | **One Year** | **Five Years** | **Since Inception**<br> **(11/30/15)** |
| **Institutional Class Shares** |  |  |  |
| &nbsp;&nbsp;&nbsp;Return Before Taxes | 3.10% | 3.14% | 3.56% |
| &nbsp;&nbsp;&nbsp;Return After Taxes on Distributions | 1.83% | 1.38% | 1.83% |
| &nbsp;&nbsp;&nbsp;Return After Taxes on Distributions and Sale of Fund Shares | 1.83% | 1.63% | 1.96% |
| **Credit Suisse Institutional Leveraged Loan Index** (reflects no deduction for fees, expenses or taxes)<sup>\*</sup> | 4.82% | 3.33% | 3.92% |
| **Morningstar LSTA US Leveraged Loan BB Rated Loan Index** (reflects no deduction for fees, expenses or taxes)<sup>\*</sup> | 3.12% | 3.19% | 3.74% |

---

\* Effective May 31, 2022, the Fund changed its primary benchmark from the Morningstar LSTA US Leveraged Loan BB Rated Loan Index (formerly known as the S&P/LSTA BB Loan Index) to the Credit Suisse Institutional Leveraged Loan Index, as it better reflects the securities in which the Fund invests. The Credit Suisse Institutional Leveraged Loan Index is a sub-index of the Credit Suisse Leveraged Loan Index and is designed to more closely reflect the investment criteria of institutional investors by sampling a lower volatility component of the market.

Actual after-tax returns depend on each shareholder's individual tax situation and may differ from those shown in the preceding table. When after-tax returns are calculated, it is assumed that the shareholder was in the highest individual federal marginal income tax bracket at the time of each distribution of income or capital gains or upon redemption. State and local income taxes are not reflected in the calculations. After-tax returns are not relevant for a shareholder who holds fund shares in a tax-advantaged account, such as an individual retirement account or a 401(k) plan. Also, figures captioned Return After Taxes on Distributions and Sale of Fund Shares may be higher than other figures for the same period if a capital loss occurs upon redemption and results in an assumed tax deduction for the shareholder.

**Management**

*Investment Advisor*

Penn Capital Management Company, LLC is the Fund's investment advisor (the "Advisor").

Portfolio Manager: Peter Duffy, CFA, Chief Investment Officer of Credit, Senior Portfolio Manager and Senior Managing Partner of the Advisor, serves as the portfolio manager to the Fund. Mr. Duffy has managed the Fund since May 2022.

**Purchase and Sale of Fund Shares**

The minimum initial investment for Institutional Class shares is $10,000. The minimum subsequent purchase amount for Institutional Class is $100.

You may purchase, exchange or redeem Fund shares on any day that the New York Stock Exchange ("NYSE") is open for trading, subject to certain restrictions. Purchases and redemptions may be made by mailing an application or redemption request to The RBB Fund Trust, c/o U.S. Bank Global Fund Services, P.O. Box 701, Milwaukee, WI 53201-0701, by wire, or by calling 1-844-302-PENN (7366). You also may visit the Fund's website at www.penncapitalfunds.com to access your mutual fund account information and request transactions including subsequent purchases, redemptions and exchanges. Investors who wish to purchase or redeem shares through a broker-dealer or other financial intermediary should contact the intermediary regarding any fees charged directly by the intermediary and the hours during which orders to purchase or redeem shares may be placed.

**Tax Information**

The Fund's distributions generally are taxable to you as ordinary income, capital gains, or some combination of both, unless you are investing through a tax-advantaged account, such as a 401(k) plan or an individual retirement account, in which case your distributions may be taxed as ordinary income when withdrawn from such account.

**Payments to Broker-Dealers and Other Financial Intermediaries**

If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank or fund supermarket), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

**Penn Capital Short Duration High Income Fund**

**Investment Objective**

The Penn Capital Short Duration High Income Fund (the "Fund") seeks to provide a high level of current income.

**Fees and Expenses**

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund.

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| | |
|:---|:---|
| **Shareholder Fees** (fees paid directly from your investment) | Institutional Class |
| Maximum Sales Charge (Load) Imposed on Purchases | None |
| Maximum Deferred Sales Charge (Load) (as a percentage of the original purchase price) | None |
| Maximum Sales Charge (Load) Imposed on Reinvested Dividends | None |

---

---

| | |
|:---|:---|
| **Annual Fund Operating Expenses**<br> (expenses that you pay each year as a percentage of the value of your investment) |  |
| Management Fees | 0.45% |
| Distribution and/or Service (12b-1) Fees | 0.00% |
| Other Expenses | 0.43% |
| Acquired Fund Fees and Expenses<sup>(1)</sup> | 0.04% |
| Total Annual Fund Operating Expenses<sup>(1)</sup> | 0.92% |
| &nbsp;&nbsp;&nbsp;Less Fee Waiver and/or Expense Reimbursement<sup>(2)</sup> | -0.34% |
| Total Annual Fund Operating Expenses (After Fee Waiver/Expense Reimbursement)<sup>(2)</sup> | 0.58% |

---

<sup>(1)</sup> "Acquired fund fees and expenses" are indirect fees and expenses that the Fund incurs from investing in the shares of other mutual funds, including money market funds and exchange-traded funds. Total Annual Fund Operating Expenses differ from the ratio of expenses to average net assets shown in the Financial Highlights, which do not include acquired fund fees and expenses because the Financial Highlights reflect the actual operating expenses of the Fund.

<sup>(2)</sup> The RBB Fund Trust (the "Trust") and Penn Capital Management Company, LLC (the "Advisor"), have entered into an expense limitation agreement under which the Advisor has agreed to waive management fees and/or pay Fund expenses to the extent necessary so that the Fund's total annual operating expenses (including any acquired fund fees and expenses incurred by the Fund as a result of its investments in other investment companies managed by the Advisor, but excluding any acquired fund fees and expenses incurred by the Fund as a result of its investments in unaffiliated investment companies, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) through the period ending December 31, 2023 do not exceed 0.54% for Institutional Class shares. Under the agreement, the Advisor is entitled to be reimbursed by the Fund for any fees it waived and expenses it paid for a period of three years following the month of the fee waiver or payment, to the extent such reimbursement will not cause the Fund to exceed any applicable expense limit that was in place when the fees were waived or expenses paid. The expense limitation agreement may be terminated by the Board of Trustees (the "Board" or "Trustees") at any time and also will terminate automatically upon the expiration or termination of the Fund's advisory contract with the Advisor.

Institutional Class

**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 and then hold or redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year, that the Fund's operating expenses remain the same, and that the expense limitation applies only for the first year. Although your actual costs may be higher or lower, based on these assumptions your cost would be:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Years** | **5 Years** | **10 Years** |
| Institutional Class | $59 | $259 | $476 | $1100 |

---

**Portfolio Turnover**

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the fiscal year ended August 31, 2022, the portfolio turnover rate for the Fund was 54% of the average value of its portfolio.

**Principal Investment Strategies**

The Fund seeks to achieve its investment objective by investing, under normal circumstances, primarily in fixed income securities and senior floating rate loans that are rated below investment grade. Below-investment grade debt instruments (commonly called "high yield" or "junk") are those instruments rated BB+ or lower by S&P Global Ratings ("S&P") or Fitch Ratings, Inc. ("Fitch"), or Ba1 or lower by Moody's Investors Service, Inc. ("Moody's"), or comparably rated by another nationally recognized statistical rating organization, or, if unrated, determined by the Advisor to be of comparable quality. Fixed income securities in which the Fund invests include debt securities such as bonds, notes and debentures. Within the high yield market, the Fund expects to invest primarily in high yield fixed income securities and senior floating rate loans, including covenant lite loans, that are generally rated at the time of purchase BB+ or lower by S&P or Ba1 or lower by Moody's, or, if unrated, determined by the Advisor to be of comparable credit quality. The Advisor seeks to pursue a conservative (defensive) investment strategy within the high yield debt market by generally avoiding the lowest rated (*i.e.*, riskiest) debt instruments in the high yield market. The Fund invests in split rated securities (securities which have different ratings from the rating agencies) if one of the ratings is at least a B- rating from S&P or B3 from Moody's. The Fund will not invest in high yield bonds or senior floating rate loans rated CCC+ or lower by S&P, and Caa1 or lower by Moody's because the Advisor has determined that such bonds and loans are the riskiest or lowest quality segment of the market and that they have historically been the most likely to default.

In selecting investments for the Fund, the Advisor incorporates environmental, social, and governance-related ("ESG") issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

Although the Fund has the ability to invest in securities of any maturity, the Fund will normally target a dollar-weighted average maturity of three years or less in an effort to emphasize a more defensive overall portfolio positioning. Maturity is a measure of the time until the principal amount of a bond or loan is due. The Fund typically focuses on instruments that have short durations and seeks to maintain a duration of no more than three years. Duration is an approximate measure of the underlying portfolio's price sensitivity to changes in prevailing interest rates. Higher duration securities typically are more sensitive to interest rate changes. Conversely, bonds and loans with a shorter duration are typically less sensitive to interest rate changes. For example, the approximate percentage decrease in the price of a security with a three-year duration would be 3% in response to a 1% increase in interest rates. Duration takes into account a debt instrument's cash flows over time, including the possibility that a debt instrument might be prepaid by the issuer or redeemed by the holder prior to the stated maturity date. Since shorter duration bonds are typically less volatile than longer duration bonds, the Fund's defensive positioning is expected to generally result in lower volatility relative to the overall high yield market.

The Fund's investments in fixed income securities and loans will typically consist of U.S. dollar denominated high yield corporate bonds and notes and senior floating rate loans. The Fund also will invest in the securities of leveraged companies (*i.e.*, companies that issue debt). In addition, the Fund may have increased exposure to investments in the financials sector. The Fund may invest up to 25% of its net assets in foreign fixed-income securities, including those denominated in U.S. dollars or other currencies, or in loans issued by lenders based outside of the U.S.

The Fund is permitted to invest without limit in privately placed Rule 144A fixed-income securities. The Fund may invest up to 20% of its net assets in convertible bonds. The Fund intends to invest primarily in below-investment grade loans and other debt instruments, including bonds, notes, debentures and debt obligations issued by real estate investment trusts ("REITs"). The Fund also will invest in loans issued by banks, as well as investment grade loans and other debt instruments. To achieve its objective, the Fund is permitted to invest in other investment companies, including affiliated investment companies, and in exchange traded funds ("ETFs"), that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein.

The Fund's investments in senior floating rate loans will be through syndicated loans. Syndicated loans are an extension of credit provided by a group of lenders and are structured, arranged, syndicated and administered by one or more banks. Loan coupons are typically "floating" rate. Floating rate securities generally pay interest at rates that adjust whenever a specified interest rate changes and/or is reset on predetermined dates (such as the last day of a month or calendar quarter). Floating rate coupons have historically been set using the London Inter-Bank Offered Rate ("LIBOR") plus the spread (i.e., the rate for such coupons will typically be a spread or margin over LIBOR). The coupon determines the periodic interest payment that the loan holder will receive. At the end of 2021, certain LIBOR rates were discontinued and an increasing number of floating rate coupons are being set using the Secured Overnight Financing Rate ("SOFR") plus a spread (i.e., the rate for such coupons will typically be a spread or margin over SOFR). Coupons are expected to be consistent with respect to the rate used (e.g., LIBOR or SOFR). Refer to "Principal Investment Risks - LIBOR Transition Risk." The Fund also expects to obtain exposure to senior floating rate loans through investments in affiliated investment companies.

The Fund may invest in "covenant lite" loans. Certain financial institutions may define "covenant lite" loans differently. Covenant lite loans may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan that has fewer restrictions typically does not include the legal clauses which allows an investor to proactively enforce financial tests or prevent or restrict undesired actions taken by the company or sponsor. Covenant lite loans also generally give the borrower/issuer more flexibility if they have met certain loan terms and provide fewer investor protections if certain criteria are breached.

The Advisor considers both quantitative and qualitative factors in its evaluation and selection of investments for the Fund. Quantitative measures include the review of company financial statements and analysis of the company's projected future financial position. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor could choose to sell a particular security if, for example, it no longer satisfies specific criteria based on the quantitative and qualitative factors outlined above, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**Principal Investment Risks**

As with all mutual funds, there is the risk that you could lose all or a portion of your investment in the Fund. An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation ("FDIC") or any other government agency. The following principal risks could affect the value of your investment and the Fund's performance:

• **Credit Risk.** Credit risk refers to the possibility that the issuer of the security or a
 counterparty in respect of a derivative instrument will not be able to satisfy its payment
 obligations to the Fund when due. Changes in an issuer's credit rating or the market's
 perception of an issuer's creditworthiness may also affect the value of the Fund's
 investment in that issuer. Securities rated in the four highest categories by the rating
 agencies are considered investment grade but they may also have some speculative characteristics.
 Investment grade ratings do not guarantee that bonds will not lose value or default.
 In addition, the credit quality of securities may be lowered if an issuer's financial
 condition changes. The Fund could also be delayed or hindered in its enforcement of rights
 against an issuer, guarantor, or counterparty.

• **High Yield Securities Risk.** High yield securities and unrated securities of similar credit
 quality, commonly known as "junk" bonds, have speculative characteristics
 and involve greater volatility of price and yield, greater risk of loss of principal
 and interest, a greater level of liquidity risk, and generally reflect a greater possibility
 of an adverse change in financial condition that could affect an issuer's ability
 to honor its obligations.

• **Debt/Fixed Income Securities Risk.** The values of fixed income securities typically will decline
 during periods of rising interest rates, and can also decline in response to changes
 in the financial condition of the issuer, borrower, counterparty, or underlying collateral
 assets, or changes in market, economic, industry, political, and regulatory conditions
 affecting a particular type of security or issuer or fixed income securities generally.
 Fixed income securities are generally subject to interest rate risk, prepayment/extension
 risk, and credit risk.

• **Leveraged Companies Risk.** Securities of leveraged companies tend to be more sensitive to issuer,
 political, market and economic developments than the market as a whole and the securities
 of other types of companies. A decrease in the credit quality of a leveraged company
 can lead to a significant decrease in the value of the company's securities. Leveraged
 companies can have limited access to additional capital.

**•** **Management Risk.** The Fund may not meet its investment objective based on the Advisor's
 success or failure to implement the Fund's investment strategies.

• **Prepayment/Extension Risk.** In connection with the Fund's investments in fixed income securities,
 the Fund may be forced to invest in securities with lower yields and thus reducing its
 income if issuers prepay certain fixed income securities. Issuers may decrease prepayments
 of principal when interest rates increase, extending the average life and duration of
 a fixed income security and causing the value of the security to decline.

• **Income Risk.** Income risk is the possibility that the Fund's income will decline because
 of falling interest rates.

• **Interest Rate Risk.** An increase in interest rates may cause a fall in the value of the fixed
 income securities in which the Fund may invest. Declines in value are greater for fixed
 income securities, as well as funds, with longer maturities or durations. Duration measures
 the sensitivity of a security's price to changes in interest rates. This measure
 incorporates a security's coupon, maturity, and call features, among other factors.

• **LIBOR Transition Risk.** Many financial instruments may be tied to the London Interbank Offered
 Rate, or "LIBOR," to determine payment obligations, financing terms, hedging
 strategies, or investment value. In July 2017, the Financial Conduct Authority, the United
 Kingdom's financial regulatory body, announced that after 2021 it would cease its
 active encouragement of banks to provide quotations needed to sustain LIBOR. The publication
 of LIBOR on a representative basis ceased for the one-week and two-month U.S. dollar
 LIBOR settings immediately after December 31, 2021, and it is expected to cease for the
 remaining U.S. dollar LIBOR settings immediately after June 30, 2023. Any potential effects
 of the transition away from LIBOR on the Fund or on certain instruments in which the
 Fund invests can be difficult to determine, and they may vary depending on factors that
 include, but are not limited to, (i) existing fallback or termination provisions in individual
 contracts and (ii) whether, how, and when industry participants develop and adopt new
 reference rates and fallbacks for both legacy and new products and instruments. The transition
 process may involve, among other things, increased volatility or illiquidity in markets
 for instruments that currently rely on LIBOR, and there may be a reduction in the value
 of certain instruments held by the Fund.

• **Bank Loan Risk.** There are a number of risks associated with an investment in floating
 rate senior secured bank loans, including credit risk, interest rate risk, liquidity
 risk and prepayment risk. Lack of an active trading market, restrictions on resale, irregular
 trading activity, wide bid/ask spreads and extended trade settlement periods in excess
 of seven days all would likely impair the Fund's ability to sell bank loans within
 its desired time frame or at an acceptable price and its ability to accurately value
 existing and prospective investments. Extended trade settlement periods may result in
 cash not being immediately available to the Fund. As a result of such illiquidity, the
 Fund may have to sell other investments or engage in borrowing transactions to raise
 cash to meet its obligations.

Bank loans in which the Fund invests have similar risks to below investment grade fixed income securities. Changes in the financial condition of the borrower or economic conditions or other circumstances could reduce the capacity of the borrower to make principal and interest payments on such instruments and may lead to defaults. Secured bank loans are supported by collateral; however, the value of the collateral may be insufficient to cover the amount owed to the Fund. If the Fund relies on a third party to administer a loan, the Fund is subject to the risk that the third party will fail to perform its obligations. In addition, if the Fund holds only a participation interest in a loan made by a third party, the Fund's receipt of payments on the loan will be dependent on the third party's willingness and ability to make those payments to the Fund.

Loans generally are subject to legal or contractual restrictions on resale. The liquidity of loans, including the volume and frequency of secondary market trading in such loans, varies significantly over time and among individual loans. For example, if the credit quality of a loan unexpectedly declines significantly, secondary market trading in that loan can also decline for a period of time. During periods of infrequent trading, valuing a loan can be more difficult and buying and selling a loan at an acceptable price can be more difficult and delayed. Difficulty in selling a loan can result in a loss. Due to their subordination in the borrower's capital structure, subordinated loans involve a higher degree of overall risk than senior bank loans of the same borrower.

A significant portion of bank loans may be "covenant lite" loans that may contain fewer or less restrictive constraints on the borrower or other borrower-friendly characteristics. The Fund may experience relatively greater realized or unrealized losses or delays in enforcing its rights on its holdings of certain covenant lite loans than its holdings of loans with the usual covenants.

• **Investments in Other Investment Companies Risk.** The Fund's investment performance is affected
 by the investment performance of the underlying funds in which the Fund may invest. Shareholders
 will indirectly be subject to the fees and expenses of the other investment companies
 and these fees and expenses are in addition to the fees and expenses that Fund shareholders
 directly bear in connection with the Fund's own operations. In addition, shareholders
 will be indirectly subject to the investment risks of the other investment companies.

• **Rating Agencies Risk.** The value of your investment in the Fund may change in response to
 changes in the credit ratings of the Fund's portfolio securities. Generally, investment
 risk and price volatility increase as a security's credit rating declines. Ratings
 are not an absolute standard of quality, but rather general indicators that reflect only
 the view of the originating rating agencies from which an explanation of the significance
 of such ratings may be obtained. There is no assurance that a particular rating will
 continue for any given period of time or that any such rating will not be revised downward
 or withdrawn entirely if, in the judgment of the agency establishing the rating, circumstances
 so warrant. A downward revision or withdrawal of such ratings, or either of them, may
 have an effect on the liquidity or market price of the securities in which the Fund invests.
 The ratings of securitized assets may not adequately reflect the credit risk of those
 assets due to their structure.

• **Private Placement Risk.** The Fund may invest in privately issued securities, including those
 which may be resold only in accordance with Rule 144A under the Securities Act of
 1933, as amended. Privately issued securities are restricted securities that are not
 registered with the U.S. Securities and Exchange Commission ("SEC"). Accordingly,
 the liquidity of the market for specific privately issued securities may vary. Delay
 or difficulty in selling such securities may result in a loss to the Fund. Privately
 issued securities that the Advisor determines to be "illiquid" are subject
 to the Fund's policy of not investing more than 15% of its net assets in illiquid
 investments.

• **Portfolio Turnover Risk.** The Advisor's tactical investment process is expected to result
 in a high portfolio turnover rate. Frequent trading increases the Fund's portfolio
 turnover rate and transaction costs, such as brokerage commissions, dealer mark-ups and
 taxes. Increased transaction costs could detract from the Fund's performance.

• **Redemption Risk.** The Fund may need to sell securities at times it would not otherwise do so
 in order to meet shareholder redemption requests. Selling securities to meet such redemptions
 could cause the Fund to experience a loss, increase the Fund's transaction costs,
 or have tax consequences. To the extent that a large shareholder invests, the Fund may
 experience relatively large redemptions if such shareholder reallocates its assets.

• **Liquidity Risk.** Certain securities may be difficult (or impossible) to sell at the time and
 at the price the Advisor would like. As a result, the Fund may have to hold these securities
 longer than it would like and may forego other investment opportunities. There is the
 possibility that the Fund may lose money or be prevented from realizing capital gains
 if it cannot sell a security at a particular time and price. Liquid portfolio investments
 may become illiquid or less liquid after purchase by the Fund due to low trading volume,
 adverse investor perceptions and/or other market developments. Liquidity risk includes
 the risk that the Fund will experience significant net redemptions at a time when it
 cannot find willing buyers for its portfolio securities or can only sell its portfolio
 securities at a material loss. Liquidity risk can be more pronounced in periods of market
 turmoil. It may be more difficult for the Fund to determine an accurate good faith fair
 value of an illiquid investment than that of a more liquid comparable investment. If
 the Fund sells investments with extended settlement times, such as loans, the settlement
 proceeds from the sales may not be available to meet the Fund's redemption obligations
 for a substantial period of time.

• **Market Risk.** The value of the Fund's portfolio securities may decline, at times sharply
 and unpredictably, as a result of unfavorable market-induced changes affecting particular
 industries, sectors, or issuers. The Fund is subject to risks affecting issuers, such
 as management performance, financial leverage, industry problems, and reduced demand
 for goods or services.

• **Volatility Risk.** The value of securities in the Fund's portfolio may go down. The Fund's
 portfolio will reflect changes in the prices of individual portfolio securities or general
 changes in securities valuations. Consequently, the Fund's share price may decline
 and you could lose money.

• **Financials Sector Risk.** Performance of companies in the financials sector may be adversely impacted
 by many factors, including, among others, government regulations, economic conditions,
 credit rating downgrades, changes in interest rates, and decreased liquidity in credit
 markets. The impact of more stringent capital requirements, recent or future regulation
 of any individual financial company or of the financials sector as a whole cannot be
 predicted. In recent years, cyber attacks and technology malfunctions and failures have
 become increasingly frequent in this sector and have caused significant losses to companies
 in this sector, which may negatively impact the Fund.

• **REIT Risk.** Debt securities issued by REITs are, for the most part, general and (may be)
 unsecured obligations and are subject to risks associated with REITs. A REIT's
 performance depends on the types, values and locations of the properties it owns and
 how well those properties are managed. Because a REIT may be invested in a limited number
 of projects or in a particular market segment, it may be more susceptible to adverse
 developments affecting a single project or market segment than more broadly diversified
 investments. The risk of defaults is generally higher in the case of mortgage pools that
 include subprime mortgages (which refer to loans made to borrowers with weakened credit
 histories or with a lower capacity to make timely payments, and second-lien mortgage
 loans), and a decline in or flattening of property values also may exacerbate losses.
 Loss of status as a qualified REIT under the U.S. federal tax laws could adversely affect
 the value of a particular REIT or the market for REITs as a whole.

• **Convertible Securities Risk.** The value of convertible securities tends to decline as interest
 rates rise and, because of the conversion feature, tends to vary with fluctuations in
 the market value of the underlying securities. Convertible securities are subject to
 the risks of stocks when the underlying stock price is high relative to the conversion
 price (because more of the security's value resides in the conversion feature)
 and fixed income securities when the underlying stock price is low relative to the conversion
 price (because the conversion feature is less valuable). A convertible security is not
 as sensitive to interest rate changes as a similar non-convertible fixed income security,
 and generally has less potential for gain or loss than the underlying stock.

• **Agent Insolvency Risk.** In a syndicated loan, the agent bank is the bank in the syndicate
 that undertakes the bulk of the administrative duties involved in the day-to-day administration
 of the loan. In the event of the insolvency of an agent bank, a loan could be subject
 to settlement risk as well as the risk of interruptions in the administrative duties
 performed in the day to day administration of the loan.

• **ETF Risk.** The Fund's investment in ETFs may subject the Fund to additional risks than
 if the Fund would have invested directly in the ETF's underlying securities. These risks
 include the possibility that an ETF may trade at a discount to the aggregate value of
 the underlying securities and although expense ratios for ETFs are generally low, frequent
 trading of ETFs by the Fund can generate brokerage expenses. In addition, because ETFs
 are listed on national stock exchanges and are traded like stocks listed on an exchange,
 (1) the Fund may acquire ETF shares at a discount or premium to their net asset
 value per share ("NAV") and (2) ETFs are subject to brokerage and other
 trading costs, which could result in greater expenses to the Fund. Trading of ETFs may
 be halted by the activation of individual or marketwide trading halts, or if the ETFs
 are delisted from an exchange. Shareholders will indirectly be subject to the fees and
 expenses of the ETFs in which the Fund invests.

• **Foreign Currency Risk.** The U.S. dollar value of foreign investments may be negatively affected
 by changes in foreign (non-U.S.) currency rates. Currency exchange rates can fluctuate
 significantly over short periods of time.

• **Foreign Securities Risk.** Investing in foreign securities typically involves more risks than
 investing in U.S. securities, including risks related to currency exchange rates and
 policies, country or government specific issues, less favorable trading practices or
 regulation and greater price volatility. Certain of these risks also may apply to securities
 of U.S. companies with significant foreign operations.

• **Maturity Risk.** Generally, a bond with a longer maturity will entail greater interest rate
 risk but have a higher yield. Conversely, a bond with a shorter maturity will entail
 less interest rate risk but have a lower yield.

• **ESG Investing Risk.** ESG investing risk is the risk stemming from the ESG factors that
 the Fund may apply in selecting securities. This may affect the Fund's exposure
 to certain companies or industries and cause the Fund to forego certain investment opportunities.
 As a result, the Fund may invest in companies that do not reflect the beliefs and values
 of any particular investor. Investors may differ in their views of ESG characteristics.
 The Fund's returns may be lower than other funds that do not use ESG ratings.

**Performance Information**

The following bar chart and table provide some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund has varied from year to year. The table shows how the average annual total returns of the Fund for various periods compare with those of ICE BofA 1-3 Year BB-Rated US Cash Pay High Yield Index, a broad measure of market performance. The table also compares the Fund's performance against the returns of ICE BofA US High Yield Cash Pay BB-B Rated 1-3 Years Index, a benchmark that has investment characteristics similar to the Fund. The Fund's past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Updated performance information is available online at <u>www.penncapitalfunds.com</u> or by calling 1-844-302-PENN (7366).

**Institutional Class Shares** 

**Calendar Year Returns as of December 31**

![](fp0081157-1_03.jpg)

The Fund's calendar year-to-date return as of September 30, 2022 was -4.77%. During the period shown in the bar chart, the highest return for a calendar quarter was 4.37% (quarter ended June 30, 2020), and the lowest return for a calendar quarter was -8.75% (quarter ended March 31, 2020).

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| | | |
|:---|:---|:---|
| *Average Annual Total Returns*<br> (for the Periods Ended December 31, 2021) |  |  |
|  | **One Year** | **Since Inception**<br> **(7/17/17)** |
| **Institutional Class Shares** |  |  |
| &nbsp;&nbsp;&nbsp;Return Before Taxes | 3.43% | 2.81% |
| &nbsp;&nbsp;&nbsp;Return After Taxes on Distributions | 2.10% | 1.36% |
| &nbsp;&nbsp;&nbsp;Return After Taxes on Distributions and Sale of Fund Shares | 2.02% | 1.52% |
| **ICE BofA 1-3 Year BB-Rated US Cash Pay High Yield Index**<br> (reflects no deduction for fees, expenses or taxes) | 3.24% | 4.39% |
| **ICE BofA US High Yield Cash Pay BB-B Rated 1-3 Years Index** <br> (reflects no deduction for fees, expenses or taxes) | 4.27% | 4.27% |

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Actual after-tax returns depend on each shareholder's individual tax situation and may differ from those shown in the preceding table. When after-tax returns are calculated, it is assumed that the shareholder was in the highest individual federal marginal income tax bracket at the time of each distribution of income or capital gains or upon redemption. State and local income taxes are not reflected in the calculations. After-tax returns are not relevant for a shareholder who holds fund shares in a tax-advantaged account, such as an individual retirement account or a 401(k) plan. Also, figures captioned Return After Taxes on Distributions and Sale of Fund Shares may be higher than other figures for the same period if a capital loss occurs upon redemption and results in an assumed tax deduction for the shareholder.

**Management**

*Investment Advisor*

Penn Capital Management Company, LLC is the Fund's investment advisor (the "Advisor").

Portfolio Manager: Peter R. Duffy, CFA, Chief Investment Officer of Credit, Senior Portfolio Manager and Senior Managing Partner of the Advisor is the team leader managing the Fund. He has managed the Fund since inception.

**Purchase and Sale of Fund Shares**

The minimum initial investment for Institutional Class shares is $10,000. The minimum subsequent purchase amount for Institutional Class is $100.

You may purchase, exchange or redeem Fund shares on any day that the New York Stock Exchange ("NYSE") is open for trading, subject to certain restrictions. Purchases and redemptions may be made by mailing an application or redemption request to The RBB Fund Trust, c/o U.S. Bank Global Fund Services, P.O. Box 701, Milwaukee, WI 53201-0701, by wire, or by calling 1-844-302-PENN (7366). You also may visit the Fund's website at www.penncapitalfunds.com to access your mutual fund account information and request transactions including subsequent purchases, redemptions and exchanges. Investors who wish to purchase or redeem shares through a broker-dealer or other financial intermediary should contact the intermediary regarding any fees charged directly by the intermediary and the hours during which orders to purchase or redeem shares may be placed.

**Tax Information**

The Fund's distributions generally are taxable to you as ordinary income, capital gains, or some combination of both, unless you are investing through a tax-advantaged account, such as a 401(k) plan or an individual retirement account, in which case your distributions may be taxed as ordinary income when withdrawn from such account.

**Payments to Broker-Dealers and Other Financial Intermediaries**

If you purchase Fund shares through a broker-dealer or other financial intermediary (such as a bank or fund supermarket), the Fund and/or its related companies may pay the intermediary for the sale of Fund shares and/or related services. These payments may create a conflict of interest by influencing the broker-dealer or other financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

**Penn Capital Opportunistic High Income Fund**

**Investment Objective**

The Penn Capital Opportunistic High Income Fund (the "Fund") seeks to provide total return through interest income and capital appreciation.

**Fees and Expenses**

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund.

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| | |
|:---|:---|
| **Shareholder Fees** (fees paid directly from your investment) | Institutional Class |
| Maximum Sales Charge (Load) Imposed on Purchases | None |
| Maximum Deferred Sales Charge (Load) (as a percentage of the original purchase price) | None |
| Maximum Sales Charge (Load) Imposed on Reinvested Dividends | None |

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| | |
|:---|:---|
| **Annual Fund Operating Expenses**<br> (expenses that you pay each year as a percentage of the value of your investment) |  |
| Management Fees | 0.69% |
| Distribution and/or Service (12b-1) Fees | 0.00% |
| Other Expenses | 0.73% |
| Acquired Fund Fees and Expenses<sup>(1)</sup> | 0.04% |
| &nbsp;&nbsp;&nbsp;Total Annual Fund Operating Expenses<sup>(1)</sup> | 1.46% |
| &nbsp;&nbsp;&nbsp;Less Fee Waiver and/or Expense Reimbursement<sup>(2)</sup> | -0.70% |
| Total Annual Fund Operating Expenses (After Fee Waiver/Expense Reimbursement)<sup>(2)</sup> | 0.76% |

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<sup>(1)</sup> "Acquired fund fees and expenses" are indirect fees and expenses that the Fund incurs from investing in the shares of other mutual funds, including money market funds and exchange-traded funds. Total Annual Fund Operating Expenses differ from the ratio of expenses to average net assets shown in the Financial Highlights, which do not include acquired fund fees and expenses because the Financial Highlights reflect the actual operating expenses of the Fund.

<sup>(2)</sup> The RBB Fund Trust (the "Trust") and Penn Capital Management Company, LLC (the "Advisor"), have entered into an expense limitation agreement under which the Advisor has agreed to waive management fees and/or pay Fund expenses to the extent necessary so that the Fund's total annual operating expenses (including any acquired fund fees and expenses incurred by the Fund as a result of its investments in other investment companies managed by the Advisor, but excluding any acquired fund fees and expenses incurred by the Fund as a result of its investments in unaffiliated investment companies, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) through the period ending December 31, 2023, do not exceed 0.72% for Institutional Class shares. Under the agreement, the Advisor is entitled to be reimbursed by the Fund for any fees it waived and expenses it paid for a period of three years following the month of the fee waiver or payment, to the extent such reimbursement will not cause the Fund to exceed any applicable expense limit that was in place when the fees were waived or expenses paid. The expense limitation agreement may be terminated by the Board of Trustees (the "Board" or "Trustees") at any time and also will terminate automatically upon the expiration or termination of the Fund's advisory contract with the Advisor.

Institutional Class

**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 and then hold or redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year, that the Fund's operating expenses remain the same, and that the expense limitation applies only for the first year. Although your actual costs may be higher or lower, based on these assumptions your cost would be:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Years** | **5 Years** | **10 Years** |
| Institutional Class | $78 | $393 | $731 | $1686 |

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**Portfolio Turnover**

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the fiscal year ended August 31, 2022, the portfolio turnover rate for the Fund was 71% of the average value of its portfolio.

**Principal Investment Strategies**

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in high yield debt instruments. High yield debt instruments include high yield fixed income securities and senior floating rate bank loans that are generally rated at the time of purchase below investment grade. Below-investment grade debt instruments (commonly called "high yield" or "junk") are those instruments rated BB+ or lower by S&P Global Ratings ("S&P") or Fitch Ratings, Inc. ("Fitch"), or Ba1 or lower by Moody's Investors Service, Inc. ("Moody's"), or comparably rated by another nationally recognized statistical rating organization, or, if unrated, determined by the Advisor to be of comparable quality. High yield securities include bonds, notes, debentures, preferred stock, payment-in-kind bonds, debt obligations issued by real estate investment trusts ("REITs"), and convertible securities. The Advisor expects to engage in tactical allocations of direct investments as well as investment in other investment companies to achieve its investment objective. As a result of this tactical allocation strategy, the Advisor is permitted to invest a significant portion of the Fund's assets directly in bank loans, including covenant lite loans, or in instruments with exposure to bank loans, and alternatively, could invest significant amounts in bonds or other instruments identified herein, and less significantly in bank loans, depending upon the Advisor's determination of market conditions as it considers the Fund's tactical investment allocation.

In selecting investments for the Fund, the Advisor incorporates environmental, social, and governance-related ("ESG") issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

The Fund is also permitted to invest in private placements, including Rule 144A fixed-income securities, in these types of securities. The Fund also can invest in common stock received through restructuring of a defaulted bond or from the conversion of a convertible security, and investment grade debt instruments. The Fund is permitted to invest in instruments of any maturity. In addition, the Fund may have increased exposure to investments in the financials sector. The Fund also is permitted to invest in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund's investments also can include the securities of companies that are experiencing financial distress, are on the brink of a restructuring or liquidation, or are currently undergoing a restructuring or liquidation under or outside of Federal Bankruptcy Code proceedings, if the Advisor believes that such securities are undervalued and have potential for capital appreciation.

The Fund intends to invest primarily in debt securities that are U.S. dollar denominated, although the Fund may invest in debt securities denominated in foreign currencies. The Fund may invest up to 25% of its net assets in debt of foreign companies.

To obtain exposure to bank loans, as well as other high yield instruments, the Fund also will invest in other investment companies, including affiliated investment companies, and exchange traded funds ("ETFs"), that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein. The Fund will obtain exposure to senior floating rate loans through (at times significant) investments in affiliated investment companies.

The Fund's investments directly in bank loans will be through syndicated loans. Syndicated loans are an extension of credit provided by a group of lenders and are structured, arranged, syndicated and administered by one or more banks. A syndicated bank loan is purchased either via "assignment" or "participation". When a loan is purchased via assignment, the buyer is approved by the borrower and becomes the legal lender of record. When a loan is purchased via participation, the buyer receives the right to repayment but is not the legal lender of record. Most loans acquired by the Fund will be via assignment. Loan coupons are typically "floating" rate. Floating rate securities generally pay interest at rates that adjust whenever a specified interest rate changes and/or reset on predetermined dates (such as the last day of a month or calendar quarter). Floating rate coupons have historically been set using the London Inter-Bank Offered Rate ("LIBOR") plus the spread (i.e., the rate for such coupons will typically be a spread or margin over LIBOR). The coupon determines the periodic interest payment that the loan holder will receive. At the end of 2021, certain LIBOR rates were discontinued and an increasing number of floating rate coupons are being set using the Secured Overnight Financing Rate ("SOFR") plus a spread (i.e., the rate for such coupons will typically be a spread or margin over SOFR). Coupons are expected to be consistent with respect to the rate used (e.g., LIBOR or SOFR). Refer to "Principal Investment Risks - LIBOR Transition Risk."

The Fund may invest in "covenant lite" loans. Certain financial institutions may define "covenant lite" loans differently. Covenant lite loans may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan that has fewer restrictions typically does not include the legal clauses which allow an investor to proactively enforce financial tests or prevent or restrict undesired actions taken by the company or sponsor. Covenant lite loans also generally give the borrower/issuer more flexibility if they have met certain loan terms and provide fewer investor protections if certain criteria are breached.

The Fund seeks to maintain a well-diversified portfolio of credit instruments with dual objectives of interest income and total return opportunities. The Advisor considers both quantitative and qualitative factors in its evaluation and selection of investments for the Fund. Quantitative measures include the review of company financial statements and analysis of the company's projected future financial position. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor could choose to sell a particular security if, for example, it no longer satisfies specific criteria based on the quantitative and qualitative factors outlined above, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**Principal Investment Risks**

As with all mutual funds, there is the risk that you could lose all or a portion of your investment in the Fund. An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation ("FDIC") or any other government agency. The following principal risks could affect the value of your investment and the Fund's performance:

• **Debt/Fixed Income Securities Risk.** The values of fixed income securities typically will decline
 during periods of rising interest rates, and can also decline in response to changes
 in the financial condition of the issuer, borrower, counterparty, or underlying collateral
 assets, or changes in market, economic, industry, political, and regulatory conditions
 affecting a particular type of security or issuer or fixed income securities generally.
 Fixed income securities are generally subject to interest rate risk, prepayment/extension
 risk, and credit risk.

• **Credit Risk.** Credit risk refers to the possibility that the issuer of the security or a
 counterparty in respect of a derivative instrument will not be able to satisfy its payment
 obligations to the Fund when due. Changes in an issuer's credit rating or the market's
 perception of an issuer's creditworthiness may also affect the value of the Fund's
 investment in that issuer. Securities rated in the four highest categories by the rating
 agencies are considered investment grade but they may also have some speculative characteristics.
 Investment grade ratings do not guarantee that bonds will not lose value or default.
 In addition, the credit quality of securities may be lowered if an issuer's financial
 condition changes. The Fund could also be delayed or hindered in its enforcement of rights
 against an issuer, guarantor, or counterparty.

• **High Yield Securities Risk.** High yield securities and unrated securities of similar credit
 quality, commonly known as "junk" bonds, have speculative characteristics
 and involve greater volatility of price and yield, greater risk of loss of principal
 and interest, a greater level of liquidity risk, and generally reflect a greater possibility
 of an adverse change in financial condition that could affect an issuer's ability
 to honor its obligations.

• **Bank Loan Risk.** There are a number of risks associated with an investment in floating
 rate senior secured bank loans, including credit risk, interest rate risk, liquidity
 risk and prepayment risk. Lack of an active trading market, restrictions on resale, irregular
 trading activity, wide bid/ask spreads and extended trade settlement periods in excess
 of seven days all would likely impair the Fund's ability to sell bank loans within
 its desired time frame or at an acceptable price and its ability to accurately value
 existing and prospective investments. Extended trade settlement periods may result in
 cash not being immediately available to the Fund. As a result of such illiquidity, the
 Fund may have to sell other investments or engage in borrowing transactions to raise
 cash to meet its obligations.

Bank loans in which the Fund invests have similar risks to below investment grade fixed income securities. Changes in the financial condition of the borrower or economic conditions or other circumstances could reduce the capacity of the borrower to make principal and interest payments on such instruments and may lead to defaults. Secured bank loans are supported by collateral; however, the value of the collateral may be insufficient to cover the amount owed to the Fund. If the Fund relies on a third party to administer a loan, the Fund is subject to the risk that the third party will fail to perform its obligations. In addition, if the Fund holds only a participation interest in a loan made by a third party, the Fund's receipt of payments on the loan will be dependent on the third party's willingness and ability to make those payments to the Fund.

Loans generally are subject to legal or contractual restrictions on resale. The liquidity of loans, including the volume and frequency of secondary market trading in such loans, varies significantly over time and among individual loans. For example, if the credit quality of a loan unexpectedly declines significantly, secondary market trading in that loan can also decline for a period of time. During periods of infrequent trading, valuing a loan can be more difficult and buying and selling a loan at an acceptable price can be more difficult and delayed. Difficulty in selling a loan can result in a loss. Due to their subordination in the borrower's capital structure, subordinated loans involve a higher degree of overall risk than senior bank loans of the same borrower.

A significant portion of bank loans may be "covenant lite" loans that may contain fewer or less restrictive constraints on the borrower or other borrower-friendly characteristics. The Fund may experience relatively greater realized or unrealized losses or delays in enforcing its rights on its holdings of certain covenant lite loans than its holdings of loans with the usual covenants.

• **Leveraged Companies Risk.** Securities of leveraged companies tend to be more sensitive to issuer,
 political, market and economic developments than the market as a whole and the securities
 of other types of companies. A decrease in the credit quality of a leveraged company
 can lead to a significant decrease in the value of the company's securities. In
 the event of liquidation or bankruptcy, a company's creditors take precedence over
 the company's stockholders. Leveraged companies can have limited access to additional
 capital.

• **LIBOR Transition Risk.** Many financial instruments may be tied to the London Interbank Offered
 Rate, or "LIBOR," to determine payment obligations, financing terms, hedging
 strategies, or investment value. In July 2017, the Financial Conduct Authority, the United
 Kingdom's financial regulatory body, announced that after 2021 it would cease its
 active encouragement of banks to provide quotations needed to sustain LIBOR. The publication
 of LIBOR on a representative basis ceased for the one-week and two-month U.S. dollar
 LIBOR settings immediately after December 31, 2021, and it is expected to cease for the
 remaining U.S. dollar LIBOR settings immediately after June 30, 2023. Any potential effects
 of the transition away from LIBOR on the Fund or on certain instruments in which the
 Fund invests can be difficult to determine, and they may vary depending on factors that
 include, but are not limited to, (i) existing fallback or termination provisions in individual
 contracts and (ii) whether, how, and when industry participants develop and adopt new
 reference rates and fallbacks for both legacy and new products and instruments. The transition
 process may involve, among other things, increased volatility or illiquidity in markets
 for instruments that currently rely on LIBOR, and there may be a reduction in the value
 of certain instruments held by the Fund.

• **Market Risk.** The value of the Fund's portfolio securities may decline, at times sharply
 and unpredictably, as a result of unfavorable market-induced changes affecting particular
 industries, sectors, or issuers. The Fund is subject to risks affecting issuers, such
 as management performance, financial leverage, industry problems, and reduced demand
 for goods or services.

• **Investments in Other Investment Companies Risk.** The Fund's investment performance is affected
 by the investment performance of the underlying funds in which the Fund may invest. Shareholders
 will indirectly be subject to the fees and expenses of the other investment companies
 and these fees and expenses are in addition to the fees and expenses that Fund shareholders
 directly bear in connection with the Fund's own operations. In addition, shareholders
 will be indirectly subject to the investment risks of the other investment companies.

• **Liquidity Risk.** Certain securities may be difficult (or impossible) to sell at the time and
 at the price the Advisor would like. As a result, the Fund may have to hold these securities
 longer than it would like and may forego other investment opportunities. There is the
 possibility that the Fund may lose money or be prevented from realizing capital gains
 if it cannot sell a security at a particular time and price. Liquid portfolio investments
 may become illiquid or less liquid after purchase by the Fund due to low trading volume,
 adverse investor perceptions and/or other market developments. Liquidity risk includes
 the risk that the Fund will experience significant net redemptions at a time when it
 cannot find willing buyers for its portfolio securities or can only sell its portfolio
 securities at a material loss. Liquidity risk can be more pronounced in periods of market
 turmoil. It may be more difficult for the Fund to determine an accurate good faith fair
 value of an illiquid investment than that of a more liquid comparable investment. If
 the Fund sells investments with extended settlement times, such as loans, the settlement
 proceeds from the sales may not be available to meet the Fund's redemption obligations
 for a substantial period of time.

• **Redemption Risk.** The Fund may need to sell securities at times it would not otherwise do so
 in order to meet shareholder redemption requests. Selling securities to meet such redemptions
 could cause the Fund to experience a loss, increase the Fund's transaction costs,
 or have tax consequences. To the extent that a large shareholder invests, the Fund may
 experience relatively large redemptions if such shareholder reallocates its assets.

• **Interest Rate Risk.** An increase in interest rates may cause a fall in the value of the fixed
 income securities in which the Fund may invest. Declines in value are greater for fixed
 income securities, as well as funds, with longer maturities or durations. Duration measures
 the sensitivity of a security's price to changes in interest rates. This measure
 incorporates a security's coupon, maturity, and call features, among other factors.

• **Income Risk.** Income risk is the possibility that the Fund's income will decline because
 of falling interest rates.

• **Portfolio Turnover Risk.** The Advisor's tactical investment process is expected to result
 in a high portfolio turnover rate. Frequent trading increases the Fund's portfolio
 turnover rate and transaction costs, such as brokerage commissions, dealer mark-ups and
 taxes. Increased transaction costs could detract from the Fund's performance.

• **Maturity Risk.** Generally, a bond with a longer maturity will entail greater interest rate
 risk but have a higher yield. Conversely, a bond with a shorter maturity will entail
 less interest rate risk but have a lower yield.

• **Rating Agencies Risk.** The value of your investment in the Fund may change in response to
 changes in the credit ratings of the Fund's portfolio securities. Generally, investment
 risk and price volatility increase as a security's credit rating declines. Ratings
 are not an absolute standard of quality, but rather general indicators that reflect only
 the view of the originating rating agencies from which an explanation of the significance
 of such ratings may be obtained. There is no assurance that a particular rating will
 continue for any given period of time or that any such rating will not be revised downward
 or withdrawn entirely if, in the judgment of the agency establishing the rating, circumstances
 so warrant. A downward revision or withdrawal of such ratings, or either of them, may
 have an effect on the liquidity or market price of the securities in which the Fund invests.
 The ratings of securitized assets may not adequately reflect the credit risk of those
 assets due to their structure.

• **Management Risk.** The Fund may not meet its investment objective based on the Advisor's
 success or failure to implement the Fund's investment strategies.

• **Prepayment/Extension Risk.** In connection with the Fund's investments in fixed income securities,
 the Fund may be forced to invest in securities with lower yields and thus reducing its
 income if issuers prepay certain fixed income securities. Issuers may decrease prepayments
 of principal when interest rates increase, extending the average life and duration of
 a fixed income security and causing the value of the security to decline.

• **Convertible Securities Risk.** The value of convertible securities tends to decline as interest
 rates rise and, because of the conversion feature, tends to vary with fluctuations in
 the market value of the underlying securities. Convertible securities are subject to
 the risks of stocks when the underlying stock price is high relative to the conversion
 price (because more of the security's value resides in the conversion feature)
 and fixed income securities when the underlying stock price is low relative to the conversion
 price (because the conversion feature is less valuable). A convertible security is not
 as sensitive to interest rate changes as a similar non-convertible fixed income security,
 and generally has less potential for gain or loss than the underlying stock.

• **Preferred Stock Risk.** Preferred stocks are subject to the risks associated with other types
 of equity securities, as well as additional risks, such as potentially greater volatility
 and risks related to deferral, non-cumulative dividends, subordination, liquidity, limited
 voting rights, and special redemption rights.

• **Agent Insolvency Risk.** In a syndicated loan, the agent bank is the bank in the syndicate
 that undertakes the bulk of the administrative duties involved in the day-to-day administration
 of the loan. In the event of the insolvency of an agent bank, a loan could be subject
 to settlement risk as well as the risk of interruptions in the administrative duties
 performed in the day to day administration of the loan.

• **Payment-In-Kind Securities Risk.** The value, interest rates, and liquidity of non-cash paying instruments,
 such as payment-in-kind securities, are subject to greater fluctuation than other types
 of securities. The higher yields and interest rates on payment-in-kind securities reflect
 the payment deferral and increased credit risk associated with such instruments and that
 such investments may represent a higher credit risk than coupon loans. Payment-in-kind
 securities may have a potential variability in valuations because their continuing accruals
 require continuing judgments about the collectability of the deferred payments and the
 value of any associated collateral.

• **ETF Risk.** The Fund's investment in ETFs may subject the Fund to additional risks than
 if the Fund would have invested directly in the ETF's underlying securities. These risks
 include the possibility that an ETF may trade at a discount to the aggregate value of
 the underlying securities and although expense ratios for ETFs are generally low, frequent
 trading of ETFs by the Fund can generate brokerage expenses. In addition, because ETFs
 are listed on national stock exchanges and are traded like stocks listed on an exchange,
 (1) the Fund may acquire ETF shares at a discount or premium to their net asset value
 per share ("NAV") and (2) ETFs are subject to brokerage and other trading
 costs, which could result in greater expenses to the Fund. Trading of ETFs may be halted
 by the activation of individual or marketwide trading halts, or if the ETFs are delisted
 from an exchange. Shareholders will indirectly be subject to the fees and expenses of
 the ETFs in which the Fund invests.

• **Private Placement Risk.** The Fund may invest in privately issued securities, including those
 which may be resold only in accordance with Rule 144A under the Securities Act of
 1933, as amended. Privately issued securities are restricted securities that are not
 registered with the U.S. Securities and Exchange Commission ("SEC"). Accordingly,
 the liquidity of the market for specific privately issued securities may vary. Delay
 or difficulty in selling such securities may result in a loss to the Fund. Privately
 issued securities that the Advisor determines to be "illiquid" are subject
 to the Fund's policy of not investing more than 15% of its net assets in illiquid
 investments.

• **Financials Sector Risk.** Performance of companies in the financials sector may be adversely impacted
 by many factors, including, among others, government regulations, economic conditions,
 credit rating downgrades, changes in interest rates, and decreased liquidity in credit
 markets. The impact of more stringent capital requirements, recent or future regulation
 of any individual financial company or of the financials sector as a whole cannot be
 predicted. In recent years, cyber attacks and technology malfunctions and failures have
 become increasingly frequent in this sector and have caused significant losses to companies
 in this sector, which may negatively impact the Fund.

• **REIT Risk.** Debt securities issued by REITs are, for the most part, general and unsecured
 obligations and are subject to risks associated with REITs. A REIT's performance
 depends on the types, values and locations of the properties it owns and how well those
 properties are managed. Because a REIT may be invested in a limited number of projects
 or in a particular market segment, it may be more susceptible to adverse developments
 affecting a single project or market segment than more broadly diversified investments.
 The risk of defaults is generally higher in the case of mortgage pools that include subprime
 mortgages (which refer to loans made to borrowers with weakened credit histories or with
 a lower capacity to make timely payments, and second-lien mortgage loans), and a decline
 in or flattening of property values also may exacerbate losses. Loss of status as a qualified
 REIT under the U.S. federal tax laws could adversely affect the value of a particular
 REIT or the market for REITs as a whole.

• **Foreign Securities Risk.** Investing in foreign securities typically involves more risks than
 investing in U.S. securities, including risks related to currency exchange rates and
 policies, country or government specific issues, less favorable trading practices or
 regulation and greater price volatility. Certain of these risks also may apply to securities
 of U.S. companies with significant foreign operations.

• **Foreign Currency Risk.** The U.S. dollar value of foreign investments may be negatively affected
 by changes in foreign (non-U.S.) currency rates. Currency exchange rates can fluctuate
 significantly over short periods of time.

• **Volatility Risk.** The value of securities in the Fund's portfolio may go down. The Fund's
 portfolio will reflect changes in the prices of individual portfolio securities or general
 changes in securities valuations. Consequently, the Fund's share price may decline
 and you could lose money.

• **ESG Investing Risk.** ESG investing risk is the risk stemming from the ESG factors that
 the Fund may apply in selecting securities. This may affect the Fund's exposure
 to certain companies or industries and cause the Fund to forego certain investment opportunities.
 As a result, the Fund may invest in companies that do not reflect the beliefs and values
 of any particular investor. Investors may differ in their views of ESG characteristics.
 The Fund's returns may be lower than other funds that do not use ESG ratings.

**Performance Information**

The following bar chart and table provide some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund's Institutional Class shares has varied from year to year. The table shows how the average annual total returns of the Fund's Institutional Class Shares for various periods compare with those of ICE BofA High Yield Constrained Index, a broad measure of market performance. The Fund's past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Updated performance information is available online at www.penncapitalfunds.com or by calling 1-844-302-PENN (7366).

**Institutional Class Shares** 

**Calendar Year Returns as of December 31**

![](fp0081157-1_04.jpg)

The Fund's calendar year-to-date return as of September 30, 2022 was -14.40%. During the period shown in the bar chart, the highest return for a calendar quarter was 7.99% (quarter ended December 31, 2020), and the lowest return for a calendar quarter was -15.08% (quarter ended March 31, 2020).

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| | | | |
|:---|:---|:---|:---|
| *Average Annual Total Returns*<br> (for the Periods Ended December 31, 2021) |  |  |  |
|  | **One Year** | **Five Years** | **Since Inception**<br> **(11/30/15)** |
| **Institutional Class Shares** |  |  |  |
| Return Before Taxes | 5.79% | 5.28% | 6.26% |
| Return After Taxes on Distributions | 3.65% | 2.62% | 3.51% |
| Return After Taxes on Distributions and Sale of Fund Shares | 3.40% | 2.84% | 3.56% |
| **ICE BofA High Yield Constrained Index**<br> (reflects no deduction for fees, expenses or taxes) | 5.35% | 6.08% | 7.32% |

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Actual after-tax returns depend on each shareholder's individual tax situation and may differ from those shown in the preceding table. When after-tax returns are calculated, it is assumed that the shareholder was in the highest individual federal marginal income tax bracket at the time of each distribution of income or capital gains or upon redemption. State and local income taxes are not reflected in the calculations. After-tax returns are not relevant for a shareholder who holds fund shares in a tax-advantaged account, such as an individual retirement account or a 401(k) plan. Also, figures captioned Return After Taxes on Distributions and Sale of Fund Shares may be higher than other figures for the same period if a capital loss occurs upon redemption and results in an assumed tax deduction for the shareholder.

**Management**

*Investment Advisor*

Penn Capital Management Company, LLC is the Fund's investment advisor (the "Advisor").

Portfolio Manager: Peter Duffy, CFA, Chief Investment Officer of Credit, Senior Portfolio Manager and Senior Managing Partner of the Advisor, serves as the portfolio manager to the Fund. Mr. Duffy has managed the Fund since May 2022.

**Purchase and Sale of Fund Shares**

The minimum initial investment for Institutional Class shares is $10,000. The minimum subsequent purchase amount for Institutional Class is $100.

You may purchase, exchange or redeem Fund shares on any day that the New York Stock Exchange ("NYSE") is open for trading, subject to certain restrictions. Purchases and redemptions may be made by mailing an application or redemption request to The RBB Fund Trust, c/o U.S. Bank Global Fund Services, P.O. Box 701, Milwaukee, WI 53201-0701, by wire, or by calling 1-844-302-PENN (7366). You also may visit the Fund's website at www.penncapitalfunds.com to access your mutual fund account information and request transactions including subsequent purchases, redemptions and exchanges. Investors who wish to purchase or redeem shares through a broker-dealer or other financial intermediary should contact the intermediary regarding any fees charged directly by the intermediary and the hours during which orders to purchase or redeem shares may be placed.

**Tax Information**

The Fund's distributions generally are taxable to you as ordinary income, capital gains, or some combination of both, unless you are investing through a tax-advantaged account, such as a 401(k) plan or an individual retirement account, in which case your distributions may be taxed as ordinary income when withdrawn from such account.

**Payments to Broker-Dealers and Other Financial Intermediaries**

If you purchase Fund shares through a broker-dealer or other financial intermediary (such as a bank or fund supermarket), the Fund and/or its related companies may pay the intermediary for the sale of Fund shares and/or related services. These payments may create a conflict of interest by influencing the broker-dealer or other financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

**Penn Capital Mid Cap Core Fund**

**Investment Objective**

The Penn Capital Mid Cap Core Fund (the "Fund") seeks to provide capital appreciation.

**Fees and Expenses**

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund.

---

| | |
|:---|:---|
| **Shareholder Fees** (fees paid directly from your investment) | Institutional Class |
| Maximum Sales Charge (Load) Imposed on Purchases | None |
| Maximum Deferred Sales Charge (Load) (as a percentage of the original purchase price) | None |
| Maximum Sales Charge (Load) Imposed on Reinvested Dividends | None |

---

---

| | |
|:---|:---|
| **Annual Fund Operating Expenses**<br> (expenses that you pay each year as a percentage of the value of your investment) |  |
| Management Fees | 0.90% |
| Distribution and/or Service (12b-1) Fees | 0.00% |
| Other Expenses | 0.59% |
| Total Annual Fund Operating Expenses | 1.49% |
| &nbsp;&nbsp;&nbsp;Less Fee Waiver and/or Expense Reimbursement<sup>(1)</sup> | -0.43% |
| Total Annual Fund Operating Expenses (After Fee Waiver/Expense Reimbursement)<sup>(1)</sup> | 1.06% |

---

<sup>(1)</sup> The RBB Fund Trust (the "Trust") and Penn Capital Management Company, LLC (the "Advisor"), have entered into an expense limitation agreement under which the Advisor has agreed to waive management fees and/or pay Fund expenses to the extent necessary so that the Fund's total annual operating expenses (excluding any acquired fund fees and expenses, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) through the period ending December 31, 2023, do not exceed 1.06% for Institutional Class shares. Under the agreement, the Advisor is entitled to be reimbursed by the Fund for any fees it waived and expenses it paid for a period of three years following the month of the fee waiver or payment, to the extent such reimbursement will not cause the Fund to exceed any applicable expense limit that was in place when the fees were waived or expenses paid. The expense limitation agreement may be terminated by the Board of Trustees (the "Board" or "Trustees") at any time and also will terminate automatically upon the expiration or termination of the Fund's advisory contract with the Advisor.

Institutional Class

**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 and then hold or redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year, that the Fund's operating expenses remain the same, and that the expense limitation applies only for the first year. Although your actual costs may be higher or lower, based on these assumptions your cost would be:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Years** | **5 Years** | **10 Years** |
| Institutional Class | $108 | $429 | $772 | $1743 |

---

**Portfolio Turnover**

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the fiscal year ended August 31, 2022, the portfolio turnover rate for the Fund was 38% of the average value of its portfolio.

**Principal Investment Strategies**

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in equity securities of mid-capitalization companies. Shareholders will be given at least 60 days advance notice of any change to the 80% investment policy. Mid-capitalization companies are defined for this purpose as companies with market capitalizations at the time of purchase between (i) the lesser of $2 billion or the market capitalization of the smallest company included in the Bloomberg US 2500 Index, and (ii) the greater of $20 billion or the market capitalization of the largest company included in the Bloomberg US 2500 Index. As of October 31, 2022, the minimum and maximum market capitalizations included in the Bloomberg US 2500 Index were approximately $19 million and $17.8 billion, respectively. The Fund is not required to sell equity securities whose market values appreciate or depreciate outside this market capitalization range.

In selecting investments for the Fund, the Advisor incorporates environmental, social, and governance-related ("ESG") issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

Equity securities in which the Fund invests include common stock; preferred stock; equity-equivalent securities such as convertible securities; other investment companies, including exchange traded funds ("ETFs"); American Depositary Receipts ("ADRs"); and real estate investment trusts ("REITs"). The Fund is also permitted to invest in private placements in these types of securities. ADRs are equity securities traded on U.S. securities exchanges, which are generally issued by banks or trust companies to evidence ownership of foreign equity securities. The Fund generally invests in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund also has the ability to invest in other investment companies, including ETFs, that have investment objectives similar to the Fund's, or that otherwise are permitted investments with the Fund's investment policies described herein. Investments in investment companies and ETFs also are permitted to manage the Fund's cash holdings. The Fund may invest more than 25% in dividend-paying securities. In addition, the Fund may have increased exposure to investments in the financials sector. The Fund also may invest up to 25% of its net assets in foreign equity securities.

The Fund generally intends to invest in approximately 50 to 90 equity securities identified by the Advisor's fundamental, bottom-up value driven research. The portfolio construction process involves both quantitative and qualitative fundamental analysis. Quantitative measures include the review of company financial statements and analysis of the company's financial metrics relative to its peer group. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor could choose to sell a security when, for example, in the Advisor's determination, it no longer represents an attractive growth prospect, or to take advantage of what the Advisor has determined to be a better investment opportunity.

**Principal Investment Risks**

As with all mutual funds, there is the risk that you could lose all or a portion of your investment in the Fund. An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation ("FDIC") or any other government agency. The following principal risks could affect the value of your investment and the Fund's performance:

• **Market Risk.** The value of the Fund's portfolio securities may decline, at times sharply
 and unpredictably, as a result of unfavorable market-induced changes affecting particular
 industries, sectors, or issuers. The Fund is subject to risks affecting issuers, such
 as management performance, financial leverage, industry problems, and reduced demand
 for goods or services.

• **Mid-Capitalization Companies Risk.** Mid-capitalization companies may not have the size, resources and
 other assets of large capitalization companies. As a result, the securities of mid-capitalization
 companies may be subject to greater market risks and fluctuations in value than large
 capitalization companies or may not correspond to changes in the stock market in general.
 In addition, mid-capitalization companies may be particularly affected by interest rate
 increases, as they may find it more difficult to borrow money to continue or expand operations,
 or may have difficulty in repaying any loans.

• **Volatility Risk.** The value of securities in the Fund's portfolio may go down. The Fund's
 portfolio will reflect changes in the prices of individual portfolio securities or general
 changes in securities valuations. Consequently, the Fund's share price may decline
 and you could lose money.

• **Management Risk.** The Fund may not meet its investment objective based on the Advisor's
 success or failure to implement the Fund's investment strategies.

• **Focused Investment Risk.** If the Fund focuses its investments in the securities of a particular
 issuer or companies in a particular country, group of countries, region, market, industry,
 group of industries, sector or asset class, the Fund's exposure to various risks
 will be heightened, including price volatility and adverse economic, market, political
 or regulatory occurrences affecting that issuer, country, group of countries region,
 market, industry, group of industries, sector or asset class.

• **Redemption Risk.** The Fund may need to sell securities at times it would not otherwise do so
 in order to meet shareholder redemption requests. Selling securities to meet such redemptions
 could cause the Fund to experience a loss, increase the Fund's transaction costs,
 or have tax consequences. To the extent that a large shareholder invests, the Fund may
 experience relatively large redemptions if such shareholder reallocates its assets.

• **Leveraged Companies Risk.** Securities of leveraged companies tend to be more sensitive to issuer,
 political, market and economic developments than the market as a whole and the securities
 of other types of companies. A decrease in the credit quality of a leveraged company
 can lead to a significant decrease in the value of the company's securities. In
 the event of liquidation or bankruptcy, a company's creditors take precedence over
 the company's stockholders. Leveraged companies can have limited access to additional
 capital.

• **Portfolio Turnover Risk.** The Advisor's tactical investment process is expected to result
 in a high portfolio turnover rate. Frequent trading increases the Fund's portfolio
 turnover rate and transaction costs, such as brokerage commissions, dealer mark-ups and
 taxes. Increased transaction costs could detract from the Fund's performance.

• **Liquidity Risk.** Certain securities may be difficult (or impossible) to sell at the time and
 at the price the Advisor would like. As a result, the Fund may have to hold these securities
 longer than it would like and may forego other investment opportunities. There is the
 possibility that the Fund may lose money or be prevented from realizing capital gains
 if it cannot sell a security at a particular time and price. Liquid portfolio investments
 may become illiquid or less liquid after purchase by the Fund due to low trading volume,
 adverse investor perceptions and/or other market developments. Liquidity risk includes
 the risk that the Fund will experience significant net redemptions at a time when it
 cannot find willing buyers for its portfolio securities or can only sell its portfolio
 securities at a material loss. Liquidity risk can be more pronounced in periods of market
 turmoil. It may be more difficult for the Fund to determine an accurate good faith fair
 value of an illiquid investment than that of a more liquid comparable investment. If
 the Fund sells investments with extended settlement times, the settlement proceeds from
 the sales may not be available to meet the Fund's redemption obligations for a
 substantial period of time.

• **Dividend-Paying Securities Risk.** Investment in dividend-paying stocks could cause the Fund to underperform
 similar medium capitalization funds that invest without consideration of a company's
 track record of paying dividends. Stocks of companies with a history of paying dividends
 may not participate in favorable markets to the same degree as other stocks, and other
 factors, such as an increase in interest rates or severe economic downturn could cause
 a company to unexpectedly decrease or even eliminate its dividend.

• **Financials Sector Risk.** Performance of companies in the financials sector may be adversely impacted
 by many factors, including, among others, government regulations, economic conditions,
 credit rating downgrades, changes in interest rates, and decreased liquidity in credit
 markets. The impact of more stringent capital requirements, recent or future regulation
 of any individual financial company or of the financials sector as a whole cannot be
 predicted. In recent years, cyber attacks and technology malfunctions and failures have
 become increasingly frequent in this sector and have caused significant losses to companies
 in this sector, which may negatively impact the Fund.

• **REIT Risk.** A REIT's performance depends on the types, values and locations of the
 properties it owns and how well those properties are managed. Because a REIT may be invested
 in a limited number of projects or in a particular market segment, it may be more susceptible
 to adverse developments affecting a single project or market segment than more broadly
 diversified investments. The risk of defaults is generally higher in the case of mortgage
 pools that include subprime mortgages (which refer to loans made to borrowers with weakened
 credit histories or with a lower capacity to make timely payments, and second-lien mortgage
 loans), and a decline in or flattening of property values also may exacerbate losses.
 Loss of status as a qualified REIT under the U.S. federal tax laws could adversely affect
 the value of a particular REIT or the market for REITs as a whole.

• **Industrials Sector Risk.** Companies in the industrials sector could be affected by, among other
 things, government regulation, world events and economic conditions, insurance costs,
 and labor relations issues.

• **Foreign Currency Risk.** The U.S. dollar value of foreign investments may be negatively affected
 by changes in foreign (non-U.S.) currency rates. Currency exchange rates can fluctuate
 significantly over short periods of time.

• **ADR Risk.** ADRs are subject to some of the same risks as direct investment in foreign
 companies, which includes international trade, currency, political, regulatory and diplomatic
 risks. In a sponsored ADR arrangement, the foreign issuer assumes the obligation to pay
 some or all of the depositary's transaction fees. Under an unsponsored ADR arrangement,
 the foreign issuer assumes no obligations and the depositary's transaction fees
 are paid directly by the ADR holders. Because unsponsored ADR arrangements are organized
 independently and without the cooperation of the issuer of the underlying securities,
 available information concerning the foreign issuer may not be as current as for sponsored
 ADRs and voting rights with respect to the deposited securities are not passed through.

• **Foreign Securities Risk.** Investing in foreign securities (including ADRs) typically involves
 more risks than investing in U.S. securities, including risks related to currency exchange
 rates and policies, country or government specific issues, less favorable trading practices
 or regulation and greater price volatility. Certain of these risks also may apply to
 securities of U.S. companies with significant foreign operations.

• **Investments in Other Investment Companies Risk.** The Fund's investment performance is affected
 by the investment performance of the underlying funds in which the Fund may invest. Shareholders
 will indirectly be subject to the fees and expenses of the other investment companies
 in which the Fund invests and these fees and expenses are in addition to the fees and
 expenses that Fund shareholders directly bear in connection with the Fund's own
 operations. In addition, shareholders will be indirectly subject to the investment risks
 of the other investment companies.

• **ETF Risk.** The Fund's investment in ETFs may subject the Fund to additional risks than
 if the Fund would have invested directly in the ETF's underlying securities. These risks
 include the possibility that an ETF may trade at a discount to the aggregate value of
 the underlying securities and although expense ratios for ETFs are generally low, frequent
 trading of ETFs by the Fund can generate brokerage expenses. In addition, because ETFs
 are listed on national stock exchanges and are traded like stocks listed on an exchange,
 (1) the Fund may acquire ETF shares at a discount or premium to their net asset value
 per share ("NAV") and (2) ETFs are subject to brokerage and other trading
 costs, which could result in greater expenses to the Fund. Trading of ETFs may be halted
 by the activation of individual or marketwide trading halts, or if the ETFs are delisted
 from an exchange. Shareholders will indirectly be subject to the fees and expenses of
 the ETFs in which the Fund invests.

• **Convertible Securities Risk.** The value of convertible securities tends to decline as interest
 rates rise and, because of the conversion feature, tends to vary with fluctuations in
 the market value of the underlying securities. Convertible securities are subject to
 the risks of stocks when the underlying stock price is high relative to the conversion
 price (because more of the security's value resides in the conversion feature)
 and fixed income securities when the underlying stock price is low relative to the conversion
 price (because the conversion feature is less valuable). A convertible security is not
 as sensitive to interest rate changes as a similar non-convertible fixed income security,
 and generally has less potential for gain or loss than the underlying stock.

• **Preferred Stock Risk.** Preferred stocks are subject to the risks associated with other types
 of equity securities, as well as additional risks, such as potentially greater volatility
 and risks related to deferral, non-cumulative dividends, subordination, liquidity, limited
 voting rights, and special redemption rights.

• **Private Placement Risk.** The Fund may invest in privately issued securities, including those
 which may be resold only in accordance with Rule 144A under the Securities Act of
 1933, as amended. Privately issued securities are restricted securities that are not
 registered with the U.S. Securities and Exchange Commission ("SEC"). Accordingly,
 the liquidity of the market for specific privately issued securities may vary. Delay
 or difficulty in selling such securities may result in a loss to the Fund. Privately
 issued securities that the Advisor determines to be "illiquid" are subject
 to the Fund's policy of not investing more than 15% of its net assets in illiquid
 investments.

• **ESG Investing Risk.** ESG investing risk is the risk stemming from the ESG factors that
 the Fund may apply in selecting securities. This may affect the Fund's exposure
 to certain companies or industries and cause the Fund to forego certain investment opportunities.
 As a result, the Fund may invest in companies that do not reflect the beliefs and values
 of any particular investor. Investors may differ in their views of ESG characteristics.
 The Fund's returns may be lower than other funds that do not use ESG ratings.

**Performance Information**

The following bar chart and table provide some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund's Institutional Class Shares has varied from year to year. The table shows how the average annual total returns of the Fund's Institutional Class Shares for various periods compare with those of the Russell 2500<sup>®</sup> Index and the Bloomberg US 2500 Index, each a broad measure of market performance. The Fund's past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Updated performance information is available online at www.penncapitalfunds.com or by calling 1-844-302-PENN (7366).

**Institutional Class Shares** 

**Calendar Year Returns as of December 31**

![](fp0081157-1_05.jpg)

The Fund's calendar year-to-date return as of September 30, 2022 was -26.78%. During the period shown in the bar chart, the highest return for a calendar quarter was 22.36% (quarter ended June 30, 2020), and the lowest return for a calendar quarter was -29.45% (quarter ended March 31, 2020).

---

| | | | |
|:---|:---|:---|:---|
| *Average Annual Total Returns*<br> (for the Periods Ended December 31, 2021) |  |  |  |
|  | **One Year** | **Five Years** | **Since Inception**<br> **(11/30/15)** |
| **Institutional Class Shares** |  |  |  |
| &nbsp;&nbsp;&nbsp;Return Before Taxes | 18.42% | 12.81% | 12.30% |
| &nbsp;&nbsp;&nbsp;Return After Taxes on Distributions | 15.40% | 11.28% | 11.05% |
| &nbsp;&nbsp;&nbsp;Return After Taxes on Distributions and Sale of Fund Shares | 12.89% | 9.91% | 9.66% |
| **Bloomberg US 2500 Index**<br> (reflects no deduction for fees, expenses or taxes)<sup>\*</sup> | 18.63% | 13.65% | 13.35% |
| **Russell 2500<sup>®</sup> Index**<br> (reflects no deduction for fees, expenses or taxes)<sup>\*</sup> | 18.18% | 13.75% | 13.39% |

---

\* Effective May 31, 2022, the Fund changed its primary benchmark from the Russell 2500**<sup>®</sup>** Index to the Bloomberg US 2500 Index, as it better reflects the securities in which the Fund invests. The Bloomberg US 2500 Index is a float market-cap-weighted benchmark of the lower 2,500 companies in capitalization of the Bloomberg US 3000 Index.

Actual after-tax returns depend on each shareholder's individual tax situation and may differ from those shown in the preceding table. When after-tax returns are calculated, it is assumed that the shareholder was in the highest individual federal marginal income tax bracket at the time of each distribution of income or capital gains or upon redemption. State and local income taxes are not reflected in the calculations. After-tax returns are not relevant for a shareholder who holds fund shares in a tax-advantaged account, such as an individual retirement account or a 401(k) plan.

**Management**

*Investment Advisor*

Penn Capital Management Company, LLC is the Fund's investment advisor (the "Advisor").

Portfolio Manager: Joseph C. Maguire, CFA, Director of Research, Chair of the Equity Risk Committee, Senior Portfolio Manager, and Senior Managing Partner of the Advisor is the team leader managing the Fund. He has managed the Fund since inception.

**Purchase and Sale of Fund Shares**

The minimum initial investment for Institutional Class shares is $10,000. The minimum subsequent purchase amount for Institutional Class is $100.

You may purchase, exchange or redeem Fund shares on any day that the New York Stock Exchange ("NYSE") is open for trading, subject to certain restrictions. Purchases and redemptions may be made by mailing an application or redemption request to The RBB Fund Trust, c/o U.S. Bank Global Fund Services, P.O. Box 701, Milwaukee, WI 53201-0701, by wire, or by calling 1-844-302-PENN (7366). You also may visit the Fund's website at www.penncapitalfunds.com to access your mutual fund account information and request transactions including subsequent purchases, redemptions and exchanges. Investors who wish to purchase or redeem shares through a broker-dealer or other financial intermediary should contact the intermediary regarding any fees charged directly by the intermediary and the hours during which orders to purchase or redeem shares may be placed.

**Tax Information**

The Fund's distributions generally are taxable to you as ordinary income, capital gains, or some combination of both, unless you are investing through a tax-advantaged account, such as a 401(k) plan or an individual retirement account, in which case your distributions may be taxed as ordinary income when withdrawn from such account.

**Payments to Broker-Dealers and Other Financial Intermediaries**

If you purchase Fund shares through a broker-dealer or other financial intermediary (such as a bank or fund supermarket), the Fund and/or its related companies may pay the intermediary for the sale of Fund shares and/or related services. These payments may create a conflict of interest by influencing the broker-dealer or other financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

**Penn Capital Special Situations Small Cap Equity Fund**

**Investment Objective**

The Penn Capital Special Situations Small Cap Equity Fund (the "Fund") seeks to provide capital appreciation.

**Fees and Expenses**

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund.

---

| | |
|:---|:---|
| **Shareholder Fees** (fees paid directly from your investment) | Institutional Class |
| Maximum Sales Charge (Load) Imposed on Purchases | None |
| Maximum Deferred Sales Charge (Load) (as a percentage of the original purchase price) | None |
| Maximum Sales Charge (Load) Imposed on Reinvested Dividends | None |

---

---

| | |
|:---|:---|
| **Annual Fund Operating Expenses**<br> (expenses that you pay each year as a percentage of the value of your investment) |  |
| Management Fees | 0.95% |
| Distribution and/or Service (12b-1) Fees | 0.00% |
| Other Expenses | 0.63% |
| Total Annual Fund Operating Expenses | 1.58% |
| &nbsp;&nbsp;&nbsp;Less Fee Waiver and/or Expense Reimbursement<sup>(1)</sup> | -0.49% |
| &nbsp;&nbsp;&nbsp;Total Annual Fund Operating Expenses (After Fee Waiver/Expense Reimbursement)<sup>(1)</sup> | 1.09% |

---

<sup>(1)</sup> The RBB Fund Trust (the "Trust") and Penn Capital Management Company, LLC (the "Advisor"), have entered into an expense limitation agreement under which the Advisor has agreed to waive management fees and/or pay Fund expenses to the extent necessary so that the Fund's total annual operating expenses (excluding any acquired fund fees and expenses, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) through the period ending December 31, 2023, do not exceed 1.09% for Institutional Class shares. Under the agreement, the Advisor is entitled to be reimbursed by the Fund for any fees it waived and expenses it paid for a period of three years following the month of the fee waiver or payment, to the extent such reimbursement will not cause the Fund to exceed any applicable expense limit that was in place when the fees were waived or expenses paid. The expense limitation agreement may be terminated by the Board of Trustees (the "Board" or "Trustees") at any time and also will terminate automatically upon the expiration or termination of the Fund's advisory contract with the Advisor.

Institutional Class

**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 and then hold or redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year, that the Fund's operating expenses remain the same, and that the expense limitation applies only for the first year. Although your actual costs may be higher or lower, based on these assumptions your cost would be:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Years** | **5 Years** | **10 Years** |
| Institutional Class | $111 | $451 | $814 | $1837 |

---

**Portfolio Turnover**

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the fiscal year ended August 31, 2022, the portfolio turnover rate for the Fund was 87% of the average value of its portfolio.

**Principal Investment Strategies**

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in the equity securities of small-capitalization companies. Small-capitalization companies are defined for this purpose as companies with market capitalizations at the time of purchase between the lesser of $100 million or the market capitalization of the smallest company included in the Bloomberg US 2000 Index and the greater of $4 billion or the market capitalization of the largest company included in the Bloomberg US 2000 Index. As of October 31, 2022, the minimum and maximum market capitalizations included in the Bloomberg US 2000 Index were approximately $19 million and $7.5 billion, respectively. The Fund is not required to sell equity securities whose market values appreciate or depreciate outside this market capitalization range.

In selecting investments for the Fund, the Advisor incorporates environmental, social, and governance-related ("ESG") issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

Equity securities in which the Fund invests include common stock; preferred stock; equity-equivalent securities such as convertible securities; other investment companies, including exchange traded funds ("ETFs"); American Depositary Receipts ("ADRs"); and real estate investment trusts ("REITs"). The Fund also is permitted to invest in private placements in these types of securities. ADRs are equity securities traded on U.S. securities exchanges, which are generally issued by banks or trust companies to evidence ownership of foreign equity securities. In addition, the Fund may have increased exposure to investments in the financials and consumer discretionary sectors. The Fund generally invests in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund also has the ability to invest in other investment companies, including ETFs, that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein. The Fund may invest up to 25% of its net assets in foreign equity securities.

The Fund generally intends to invest in approximately 50 to 90 equity securities identified by the Advisor's fundamental, bottom-up value driven research. The portfolio construction process involves both quantitative and qualitative fundamental analysis. Quantitative measures include the review of company financial statements and analysis of the company's financial metrics relative to its peer group. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor could choose to sell a security when, for example, in the Advisor's determination, it no longer represents an attractive growth prospect, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**Principal Investment Risks**

As with all mutual funds, there is the risk that you could lose all or a portion of your investment in the Fund. An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation ("FDIC") or any other government agency. The following principal risks could affect the value of your investment and the Fund's performance:

• **Market Risk.** The value of the Fund's portfolio securities may decline, at times sharply
 and unpredictably, as a result of unfavorable market-induced changes affecting particular
 industries, sectors, or issuers. The Fund is subject to risks affecting issuers, such
 as management performance, financial leverage, industry problems, and reduced demand
 for goods or services.

• **Small-Capitalization Companies Risk.** Small-capitalization companies may not have the size, resources and
 other assets of large capitalization companies. As a result, the securities of small-capitalization
 companies may be subject to greater market risks and fluctuations in value than large
 capitalization companies or may not correspond to changes in the stock market in general.
 In addition, small-capitalization companies may be particularly affected by interest
 rate increases, as they may find it more difficult to borrow money to continue or expand
 operations, or may have difficulty in repaying any loans.

• **Volatility Risk.** The value of securities in the Fund's portfolio may go down. The Fund's
 portfolio will reflect changes in the prices of individual portfolio securities or general
 changes in securities valuations. Consequently, the Fund's share price may decline
 and you could lose money.

• **Management Risk.** The Fund may not meet its investment objective based on the Advisor's
 success or failure to implement the Fund's investment strategies.

• **Leveraged Companies Risk.** Securities of leveraged companies tend to be more sensitive to issuer,
 political, market and economic developments than the market as a whole and the securities
 of other types of companies. A decrease in the credit quality of a leveraged company
 can lead to a significant decrease in the value of the company's securities. In
 the event of liquidation or bankruptcy, a company's creditors take precedence over
 the company's stockholders. Leveraged companies can have limited access to additional
 capital.

• **Redemption Risk.** The Fund may need to sell securities at times it would not otherwise do so
 in order to meet shareholder redemption requests. Selling securities to meet such redemptions
 could cause the Fund to experience a loss, increase the Fund's transaction costs,
 or have tax consequences. To the extent that a large shareholder invests, the Fund may
 experience relatively large redemptions if such shareholder reallocates its assets.

• **Focused Investment Risk.** If the Fund focuses its investments in the securities of a particular
 issuer or companies in a particular country, group of countries, region, market, industry,
 group of industries, sector or asset class, the Fund's exposure to various risks
 will be heightened, including price volatility and adverse economic, market, political
 or regulatory occurrences affecting that issuer, country, group of countries region,
 market, industry, group of industries, sector or asset class.

• **Portfolio Turnover Risk.** The Advisor's tactical investment process is expected to result
 in a high portfolio turnover rate. Frequent trading increases the Fund's portfolio
 turnover rate and transaction costs, such as brokerage commissions, dealer mark-ups and
 taxes. Increased transaction costs could detract from the Fund's performance.

• **Liquidity Risk.** Certain securities may be difficult (or impossible) to sell at the time and
 at the price the Advisor would like. As a result, the Fund may have to hold these securities
 longer than it would like and may forego other investment opportunities. There is the
 possibility that the Fund may lose money or be prevented from realizing capital gains
 if it cannot sell a security at a particular time and price. Liquid portfolio investments
 may become illiquid or less liquid after purchase by the Fund due to low trading volume,
 adverse investor perceptions and/or other market developments. Liquidity risk includes
 the risk that the Fund will experience significant net redemptions at a time when it
 cannot find willing buyers for its portfolio securities or can only sell its portfolio
 securities at a material loss. Liquidity risk can be more pronounced in periods of market
 turmoil. It may be more difficult for the Fund to determine an accurate good faith fair
 value of an illiquid investment than that of a more liquid comparable investment. If
 the Fund sells investments with extended settlement times, the settlement proceeds from
 the sales may not be available to meet the Fund's redemption obligations for a
 substantial period of time.

• **Consumer Discretionary Sector Risk.** Companies engaged in the consumer discretionary sector
 are affected by fluctuations in supply and demand and changes in consumer preferences,
 social trends and marketing campaigns. Changes in consumer spending as a result of world
 events, political and economic conditions, commodity price volatility, changes in exchange
 rates, imposition of import controls, increased competition, depletion or resources and
 labor relations also may adversely affect these companies.

• **Financials Sector Risk.** Performance of companies in the financials sector may be adversely impacted
 by many factors, including, among others, government regulations, economic conditions,
 credit rating downgrades, changes in interest rates, and decreased liquidity in credit
 markets. The impact of more stringent capital requirements, recent or future regulation
 of any individual financial company or of the financials sector as a whole cannot be
 predicted. In recent years, cyber attacks and technology malfunctions and failures have
 become increasingly frequent in this sector and have caused significant losses to companies
 in this sector, which may negatively impact the Fund.

• **REIT Risk.** A REIT's performance depends on the types, values and locations of the
 properties it owns and how well those properties are managed. Because a REIT may be invested
 in a limited number of projects or in a particular market segment, it may be more susceptible
 to adverse developments affecting a single project or market segment than more broadly
 diversified investments. The risk of defaults is generally higher in the case of mortgage
 pools that include subprime mortgages (which refer to loans made to borrowers with weakened
 credit histories or with a lower capacity to make timely payments, and second-lien mortgage
 loans), and a decline in or flattening of property values also may exacerbate losses.
 Loss of status as a qualified REIT under the U.S. federal tax laws could adversely affect
 the value of a particular REIT or the market for REITs as a whole.

• **Industrials Sector Risk.** Companies in the industrials sector could be affected by, among other
 things, government regulation, world events and economic conditions, insurance costs,
 and labor relations issues.

• **Foreign Currency Risk.** The U.S. dollar value of foreign investments may be negatively affected
 by changes in foreign (non-U.S.) currency rates. Currency exchange rates can fluctuate
 significantly over short periods of time.

• **ADR Risk.** ADRs are subject to some of the same risks as direct investment in foreign
 companies, which includes international trade, currency, political, regulatory and diplomatic
 risks. In a sponsored ADR arrangement, the foreign issuer assumes the obligation to pay
 some or all of the depositary's transaction fees. Under an unsponsored ADR arrangement,
 the foreign issuer assumes no obligations and the depositary's transaction fees
 are paid directly by the ADR holders. Because unsponsored ADR arrangements are organized
 independently and without the cooperation of the issuer of the underlying securities,
 available information concerning the foreign issuer may not be as current as for sponsored
 ADRs and voting rights with respect to the deposited securities are not passed through.

• **Foreign Securities Risk.** Investing in foreign securities (including ADRs) typically involves
 more risks than investing in U.S. securities, including risks related to currency exchange
 rates and policies, country or government specific issues, less favorable trading practices
 or regulation and greater price volatility. Certain of these risks also may apply to
 securities of U.S. companies with significant foreign operations.

• **Investments in Other Investment Companies Risk.** The Fund's investment performance is affected
 by the investment performance of the underlying funds in which the Fund may invest. Shareholders
 will indirectly be subject to the fees and expenses of the other investment companies
 and these fees and expenses are in addition to the fees and expenses that Fund shareholders
 directly bear in connection with the Fund's own operations. In addition, shareholders
 will be indirectly subject to the investment risks of the other investment companies.

• **ETF Risk.** The Fund's investment in ETFs may subject the Fund to additional risks than
 if the Fund would have invested directly in the ETF's underlying securities. These risks
 include the possibility that an ETF may trade at a discount to the aggregate value of
 the underlying securities and although expense ratios for ETFs are generally low, frequent
 trading of ETFs by the Fund can generate brokerage expenses. In addition, because ETFs
 are listed on national stock exchanges and are traded like stocks listed on an exchange,
 (1) the Fund may acquire ETF shares at a discount or premium to their net asset value
 per share ("NAV") and (2) ETFs are subject to brokerage and other trading
 costs, which could result in greater expenses to the Fund. Trading of ETFs may be halted
 by the activation of individual or marketwide trading halts, or if the ETFs are delisted
 from an exchange. Shareholders will indirectly be subject to the fees and expenses of
 the ETFs in which the Fund invests.

• **Convertible Securities Risk.** The value of convertible securities tends to decline as interest
 rates rise and, because of the conversion feature, tends to vary with fluctuations in
 the market value of the underlying securities. Convertible securities are subject to
 the risks of stocks when the underlying stock price is high relative to the conversion
 price (because more of the security's value resides in the conversion feature)
 and fixed income securities when the underlying stock price is low relative to the conversion
 price (because the conversion feature is less valuable). A convertible security is not
 as sensitive to interest rate changes as a similar non-convertible fixed income security,
 and generally has less potential for gain or loss than the underlying stock.

• **Preferred Stock Risk.** Preferred stocks are subject to the risks associated with other types
 of equity securities, as well as additional risks, such as potentially greater volatility
 and risks related to deferral, non-cumulative dividends, subordination, liquidity, limited
 voting rights, and special redemption rights.

• **Private Placement Risk.** The Fund may invest in privately issued securities, including those
 which may be resold only in accordance with Rule 144A under the Securities Act of
 1933, as amended. Privately issued securities are restricted securities that are not
 registered with the U.S. Securities and Exchange Commission ("SEC"). Accordingly,
 the liquidity of the market for specific privately issued securities may vary. Delay
 or difficulty in selling such securities may result in a loss to the Fund. Privately
 issued securities that the Advisor determines to be "illiquid" are subject
 to the Fund's policy of not investing more than 15% of its net assets in illiquid
 investments.

• **ESG Investing Risk.** ESG investing risk is the risk stemming from the ESG factors that
 the Fund may apply in selecting securities. This may affect the Fund's exposure
 to certain companies or industries and cause the Fund to forego certain investment opportunities.
 As a result, the Fund may invest in companies that do not reflect the beliefs and values
 of any particular investor. Investors may differ in their views of ESG characteristics.
 The Fund's returns may be lower than other funds that do not use ESG ratings.

**Performance Information**

The following bar chart and table provide some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund's Institutional Class Shares has varied from year to year. The table shows how the average annual total returns of the Fund's Institutional Class Shares for various periods compare with those of the Russell 2000<sup>®</sup> Index and the Bloomberg US 2000 Index, each a broad measure of market performance. The Fund's past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Updated performance information is available online at <u>www.penncapitalfunds.com</u> or by calling 1-844-302-PENN (7366).

**Institutional Class Shares** 

**Calendar Year Returns as of December 31**

![](fp0081157-1_06.jpg)

The Fund's calendar year-to-date return as of September 30, 2022 was -25.57%. During the period shown in the bar chart, the highest return for a calendar quarter was 39.46% (quarter ended December 31, 2020), and the lowest return for a calendar quarter was -39.71% (quarter ended March 31, 2020).

---

| | | | |
|:---|:---|:---|:---|
| *Average Annual Total Returns*<br> (for the Periods Ended December 31, 2021) |  |  |  |
|  | **One Year** | **Five Years** | **Since Inception** <br> **(12/17/15)**  |
| **Institutional Class Shares** |  |  |  |
| Return Before Taxes | 33.33% | 16.34% | 17.06% |
| Return After Taxes on Distributions | 25.79% | 13.66% | 14.29% |
| Return After Taxes on Distributions and Sale of Fund Shares | 22.57% | 12.25% | 12.82% |
| **Bloomberg US 2000 Index** <br> (reflects no deduction for fees, expenses or taxes)<sup>\*</sup>  | 18.58% | 12.91% | 14.28% |
| **Russell 2000<sup>®</sup> Index**<br> (reflects no deduction for fees, expenses or taxes)<sup>\*</sup> | 14.82% | 12.02% | 13.45% |

---

\* Effective May 31, 2022, the Fund changed its primary benchmark from the Russell 2000<sup>®</sup> Index to the Bloomberg US 2000 Index, as it better reflects the securities in which the Fund invests. The Bloomberg US 2000 Index is a float market-cap-weighted benchmark of the lower 2,000 companies in capitalization of the Bloomberg US 3000 Index.

Actual after-tax returns depend on each shareholder's individual tax situation and may differ from those shown in the preceding table. When after-tax returns are calculated, it is assumed that the shareholder was in the highest individual federal marginal income tax bracket at the time of each distribution of income or capital gains or upon redemption. State and local income taxes are not reflected in the calculations. After-tax returns are not relevant for a shareholder who holds fund shares in a tax-advantaged account, such as an individual retirement account or a 401(k) plan.

**Management**

*Investment Advisor*

Penn Capital Management Company, LLC is the Fund's investment advisor (the "Advisor").

Portfolio Manager: Eric J. Green, CFA, Chief Investment Officer of Equity, Senior Portfolio Manager, and Senior Managing Partner of the Advisor is the team leader managing the Fund. He has managed the Fund since inception.

**Purchase and Sale of Fund Shares**

The minimum initial investment for Institutional Class shares is $10,000. The minimum subsequent purchase amount for Institutional Class $100.

You may purchase, exchange or redeem Fund shares on any day that the New York Stock Exchange ("NYSE") is open for trading, subject to certain restrictions. Purchases and redemptions may be made by mailing an application or redemption request to The RBB Fund Trust, c/o U.S. Bank Global Fund Services, P.O. Box 701, Milwaukee, WI 53201-0701, by wire, or by calling 1-844-302-PENN (7366). You also may visit the Fund's website at www.penncapitalfunds.com to access your mutual fund account information and request transactions including subsequent purchases, redemptions and exchanges. Investors who wish to purchase or redeem shares through a broker-dealer or other financial intermediary should contact the intermediary regarding any fees charged directly by the intermediary and the hours during which orders to purchase or redeem shares may be placed.

**Tax Information**

The Fund's distributions generally are taxable to you as ordinary income, capital gains, or some combination of both, unless you are investing through a tax-advantaged account, such as a 401(k) plan or an individual retirement account, in which case your distributions may be taxed as ordinary income when withdrawn from such account.

**Payments to Broker-Dealers and Other Financial Intermediaries**

If you purchase Fund shares through a broker-dealer or other financial intermediary (such as a bank or fund supermarket), the Fund and/or its related companies may pay the intermediary for the sale of Fund shares and/or related services. These payments may create a conflict of interest by influencing the broker-dealer or other financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

**MORE INFORMATION ABOUT THE FUNDS**

**PENN CAPITAL FLOATING RATE INCOME FUND** 

**Investment Objective and Principal Investment Strategies**

*Investment Objective*

The Penn Capital Floating Rate Income Fund seeks to provide current income. This objective and the Fund's investment strategies are non-fundamental and may be changed by the Board without shareholder approval.

*Principal Investment Strategies*

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in floating rate senior secured loans, floating rate senior corporate debt and other floating rate senior instruments. Shareholders will be given at least 60 days advance notice of any change to the 80% investment policy. The loans and instruments in which the Fund invests include bank loans, (including covenant lite loans), bonds, and debt securities issued by various domestic and foreign entities. The Fund also invests in private placements in these types of securities. The Fund intends to invest in instruments that are U.S. dollar denominated. The Fund may invest up to 25% of its net assets in foreign debt instruments. The Fund intends to invest primarily in below-investment grade loans and instruments, including debt obligations issued by REITs, bonds, notes and debentures, but may also invest in investment grade loans and instruments. Below-investment grade debt instruments (commonly called "high yield" or "junk" bonds) are those instruments rated BB+ or lower by S&P or Fitch, or Ba1 or lower by Moody's, or comparably rated by another nationally recognized statistical rating organization, or, if unrated, determined by the Advisor to be of comparable quality. The Advisor seeks to pursue a conservative (defensive) investment strategy within the high yield debt market by generally avoiding the lowest rated (*i.e.*, riskiest) debt instruments in the high yield market. REITs are pooled investment vehicles that invest primarily in income-producing real estate or real estate-related loans or interests. The Fund is permitted to invest in instruments of any maturity. The Fund may invest up to 10% of its net assets in subordinated loans. Subordinated loans generally have the same characteristics as senior loans except that such loans are subordinated in payment and/or lower in lien priority to first lien holders or may be unsecured. In addition, the Fund may have increased exposure to investments in the financials sector. The Fund also is permitted to invest in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund also invests in other investment companies, including ETFs, that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein. Investment companies that have a policy of investing at least 80% of their assets in senior floating rate instruments or investments that provide exposure to senior floating rate instruments may be used to satisfy the Fund's 80% investment policy.

In selecting investments for the Fund, the Advisor incorporates ESG issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

The Fund's investments in senior floating rate loans will be through syndicated loans. Syndicated loans are an extension of credit provided by a group of lenders and are structured, arranged, syndicated and administered by one or more banks. A syndicated bank loan is purchased either via "assignment" or "participation". When a loan is purchased via assignment, the buyer is approved by the borrower and becomes the legal lender of record. When a loan is purchased via participation, the buyer receives the right to repayment but is not the legal lender of record. Most loans acquired by the Fund will be via assignment.

Loan coupons are typically "floating" rate. Floating rate securities generally pay interest at rates that adjust whenever a specified interest rate changes and/or is reset on predetermined dates (such as the last day of a month or calendar quarter). Floating rate coupons have historically been set using LIBOR plus the spread (i.e., the rate for such coupons will typically be a spread or margin over LIBOR). The coupon determines the periodic interest payment that the loan holder will receive. Some loans contain a "LIBOR Floor," which sets a minimum level on which to base the calculation of the coupon. Other loans do not contain a LIBOR Floor, and those coupons typically will be the sum of the 3-month market rate of LIBOR plus the spread. Coupons usually reset quarterly based upon the prevailing LIBOR rate. At the end of 2021, certain LIBOR rates were discontinued and an increasing number of floating rate coupons are being set using the Secured Overnight Financing Rate ("SOFR") plus a spread (i.e., the rate for such coupons will typically be a spread or margin over SOFR). Coupons are expected to be consistent with respect to the rate used (e.g., LIBOR or SOFR). Refer to "Principal Investment Risks - LIBOR Transition Risk."

The Fund may invest in "covenant lite" loans. Certain financial institutions may define "covenant lite" loans differently. Covenant lite loans may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan that has fewer restrictions typically does not include the legal clauses which allow an investor to proactively enforce financial tests or prevent or restrict undesired actions taken by the company or sponsor. Covenant lite loans also generally give the borrower/issuer more flexibility if they have met certain loan terms and provide fewer investor protections if certain criteria are breached.

The Fund seeks to preserve capital by attempting to limit downside risk through the detection of significant negative changes in future operating cash flow levels of issuers before such risk is fully reflected in the price of the securities, pursuant to a due diligence process which includes discussions with management, competitors, suppliers and industry experts. The Advisor will review loan and bond covenants, the underlying collateral, the sources of a company's liquidity including cash, available bank lines and ability to refinance to determine the likelihood of maturity. The Advisor could choose to sell a particular security if, for example, it no longer satisfies specific criteria based on the quantitative and qualitative factors outlined above, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**PENN CAPITAL SHORT DURATION HIGH INCOME FUND**

**Investment Objective and Principal Investment Strategies**

*Investment Objective*

The Penn Capital Short Duration High Income Fund seeks to provide a high level of current income. This objective and the Fund's investment strategies are non-fundamental and may be changed by the Board without shareholder approval.

*Principal Investment Strategies*

The Fund seeks to achieve its investment objective by investing, under normal circumstances, primarily in fixed income securities and senior floating rate loans that are rated below investment grade. Below-investment grade debt instruments (commonly called "high yield" or "junk") are those instruments rated BB+ or lower by S&P or Fitch, or Ba1 or lower by Moody's, or, if unrated, determined by the Advisor to be of comparable quality. Fixed income securities in which the Fund invests include debt securities such as bonds, notes and debentures. Within the high yield market, the Fund expects to invest primarily in those high yield fixed income securities and senior floating rate loans, including covenant lite loans, that are generally rated at the time of purchase BB+ or lower by S&P or Ba1 or lower by Moody's or comparably rated by another nationally recognized statistical rating organization, or, if unrated, determined by the Advisor to be of comparable credit quality. In pursuing its conservative (defensive) strategy, the Fund anticipates that it will normally invest in the higher credit quality tier of the overall high yield debt securities market through avoiding the lowest rated (*i.e.*, riskiest) debt instruments. The Fund invests in split rated securities (securities which have different ratings from the rating agencies) if one of the ratings is at least a B- rating from S&P or B3 from Moody's. The Fund will not invest in high yield bonds or senior floating rate loans rated CCC+ or lower by S&P, and Caa1 or lower by Moody's because the Advisor has determined that such bonds and loans are the riskiest or lowest quality segment of the market and that they have historically been the most likely to default.

In selecting investments for the Fund, the Advisor incorporates ESG issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

Although the Fund has the ability to invest in securities of any maturity, the Fund will normally target a dollar-weighted average maturity of three years or less in an effort to emphasize a more defensive overall portfolio positioning. Maturity is a measure of the time until the principal amount of a bond or loan is due. The Fund typically focuses on instruments that have short durations and seeks to maintain a duration of no more than three years. Duration is an approximate measure of the underlying portfolio's price sensitivity to changes in prevailing interest rates. Higher duration securities typically are more sensitive to interest rate changes. Conversely, bonds and loans with a shorter duration are typically less sensitive to interest rate changes. For example, the approximate percentage decrease in the price of a security with a three-year duration would be 3% in response to a 1% increase in interest rates. Duration takes into account a debt instrument's cash flows over time, including the possibility that a debt instrument might be prepaid by the issuer or redeemed by the holder prior to the stated maturity date. Since shorter duration bonds are typically less volatile than longer duration bonds, the Fund's defensive positioning is expected to generally result in lower volatility relative to the overall high yield market.

The Fund's investments in fixed income securities and loans will typically consist of U.S. dollar denominated high yield corporate bonds and notes and senior floating rate loans. The Fund also will invest in the securities of leveraged companies (*i.e.*, companies that issue debt). In addition, the Fund may have increased exposure to investments in the financials sector. The Fund may invest up to 25% of its net assets in foreign fixed-income securities, including those denominated in U.S. dollars or other currencies, or in loans issued by lenders based outside of the U.S.

The Fund is permitted to invest without limit in privately placed Rule 144A fixed-income securities. The Fund may invest up to 20% of its net assets in convertible bonds. The Fund intends to invest primarily in below-investment grade loans and other debt instruments, including bonds, notes, debentures and debt obligations issued by REITs. The Fund also will invest in loans issued by banks, as well as investment grade loans and other debt instruments. To achieve its objective, the Fund is permitted to invest in other investment companies, including affiliated investment companies, and in ETFs, that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein. Investment in ETFs also is permitted to track fixed income indices in an effort to manage the Fund's cash holdings.

The Fund's investments in senior floating rate loans will be through syndicated loans. Syndicated loans are an extension of credit provided by a group of lenders and are structured, arranged, syndicated and administered by one or more banks. A syndicated bank loan is purchased either via "assignment" or "participation". When a loan is purchased via assignment, the buyer is approved by the borrower and becomes the legal lender of record. When a loan is purchased via participation, the buyer receives the right to repayment but is not the legal lender of record. Most loans acquired by the Fund will be via assignment.

Loan coupons are typically "floating" rate. Floating rate securities generally pay interest at rates that adjust whenever a specified interest rate changes and/or is reset on predetermined dates (such as the last day of a month or calendar quarter). Floating rate coupons have historically been set using the LIBOR plus the spread (i.e., the rate for such coupons will typically be a spread or margin over LIBOR). The coupon determines the periodic interest payment that the loan holder will receive. Some loans contain a "LIBOR Floor," which sets a minimum level on which to base the calculation of the coupon. Other loans do not contain a LIBOR Floor, and those coupons typically will be the sum of the 3-month market rate of LIBOR plus the spread. Coupons usually reset quarterly based upon the prevailing LIBOR rate. At the end of 2021, certain LIBOR rates were discontinued and an increasing number of floating rate coupons are being set using the Secured Overnight Financing Rate ("SOFR") plus a spread (i.e., the rate for such coupons will typically be a spread or margin over SOFR). Coupons are expected to be consistent with respect to the rate used (e.g., LIBOR or SOFR). Refer to "Principal Investment Risks - LIBOR Transition Risk." The Fund also expects to obtain exposure to senior floating rate loans through investments in affiliated investment companies.

The Fund may invest in "covenant lite" loans. Certain financial institutions may define "covenant lite" loans differently. Covenant lite loans may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan that has fewer restrictions typically does not include the legal clauses which allow an investor to proactively enforce financial tests or prevent or restrict undesired actions taken by the company or sponsor. Covenant lite loans also generally give the borrower/issuer more flexibility if they have met certain loan terms and provide fewer investor protections if certain criteria are breached.

The Fund seeks to maintain a well-diversified portfolio of credit instruments with the objective to seek a high level of current income. The Advisor considers both quantitative and qualitative factors in its evaluation and selection of investments for the Fund. Quantitative measures include the review of company financial statements and analysis of the company's projected future financial position. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor will closely examine the sources of a company's liquidity, including cash, available bank lines and ability to refinance to determine the likelihood of maturity. The Advisor could choose to sell a particular security if, for example, it no longer satisfies specific criteria based on the quantitative and qualitative factors outlined above, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**PENN CAPITAL OPPORTUNISTIC HIGH INCOME FUND**

**Investment Objective and Principal Investment Strategies**

*Investment Objective*

The Penn Capital Opportunistic High Income Fund seeks to provide total return through interest income and capital appreciation. This objective and the Fund's investment strategies are non-fundamental and may be changed by the Board without shareholder approval.

*Principal Investment Strategies*

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in high yield debt instruments. Shareholders will be given at least 60 days advance notice of any change to the 80% investment policy. High yield debt instruments include high yield fixed income securities and senior floating rate bank loans that are generally rated at the time of purchase below investment grade. Below-investment grade debt instruments (commonly called "high yield" or "junk") are those instruments rated BB+ or lower by S&P or Fitch, or Ba1 or lower by Moody's, or comparably rated by another nationally recognized statistical rating organization, or, if unrated, determined by the Advisor to be of comparable quality. High yield securities include bonds, notes, debentures, preferred stock, payment-in-kind bonds, debt obligations issued by REITs, and convertible securities. The Advisor expects to engage in tactical allocations of direct investments as well as investment in other investment companies to achieve its investment objective. As a result of this tactical allocation strategy, the Advisor is permitted to invest a significant portion of the Fund's assets directly in bank loans or in instruments with exposure to bank loans, including covenant lite loans, for a period of time, and alternatively, could invest significant amounts in bonds or other instruments identified herein, and less significantly in bank loans, depending upon the Advisor's determination of market conditions as it considers the Fund's tactical investment allocation.

In selecting investments for the Fund, the Advisor incorporates ESG issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

The Fund is also permitted to invest in private placements, including Rule 144A fixed-income securities, in these types of securities. REITs are pooled investment vehicles that invest primarily in income-producing real estate or real estate-related loans or interests. Convertible bond issues, unlike conventional high yield bonds, give the bondholder the right to convert the bond within a specified period of time and at a pre-stated price or formula into common stock or provide an opportunity for equity participation of the same or a different issuer. Such bonds will generally be more volatile because their market value is influenced by the price action of the underlying stock, and the conversion feature provides the possibility of capital appreciation beyond par value. The Fund also can invest in common stock received through restructuring of a defaulted bond or from the conversion of a convertible security, and investment grade debt instruments. The Fund is permitted to invest in instruments of any maturity. In addition, the Fund may have increased exposure to investments in the financials sector. The Fund also is permitted to invest in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund's investments may include the securities of companies that are experiencing financial distress, are on the brink of a restructuring or liquidation, or are currently undergoing a restructuring or liquidation under or outside of Federal Bankruptcy Code proceedings, if the Advisor believes that such securities are undervalued and have potential for capital appreciation.

The Fund intends to invest primarily in debt securities that are U.S. dollar denominated, although the Fund may invest in debt securities denominated in foreign currencies. The Fund may invest up to 25% of its net assets in debt of foreign companies.

To obtain exposure to bank loans, as well as other high yield instruments, the Fund will invest in other investment companies, including affiliated investment companies, and in ETFs, that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein. Investment companies that have a policy of investing at least 80% of their assets in high yield debt instruments or investments that provide exposure to high yield debt instruments may be used to satisfy the Fund's 80% investment policy. The Fund will obtain exposure to senior floating rate loans through (at times significant) investments in affiliated investment companies.

The Fund's investments directly in bank loans will be through syndicated loans. Syndicated loans are an extension of credit provided by a group of lenders and are structured, arranged, syndicated and administered by one or more banks. A syndicated bank loan is purchased either via "assignment" or "participation". When a loan is purchased via assignment, the buyer is approved by the borrower and becomes the legal lender of record. When a loan is purchased via participation, the buyer receives the right to repayment but is not the legal lender of record. Most loans acquired by the Fund will be via assignment. Loan coupons are typically "floating" rate. Floating rate securities generally pay interest at rates that adjust whenever a specified interest rate changes and/or reset on predetermined dates (such as the last day of a month or calendar quarter). Floating rate coupons have historically been set using the LIBOR plus the spread (i.e., the rate for such coupons will typically be a spread or margin over LIBOR). The coupon determines the periodic interest payment that the loan holder will receive. At the end of 2021, certain LIBOR rates were discontinued and an increasing number of floating rate coupons are being set using the Secured Overnight Financing Rate ("SOFR") plus a spread (i.e., the rate for such coupons will typically be a spread or margin over SOFR). Coupons are expected to be consistent with respect to the rate used (e.g., LIBOR or SOFR). Refer to "Principal Investment Risks - LIBOR Transition Risk."

The Fund may invest in "covenant lite" loans. Certain financial institutions may define "covenant lite" loans differently. Covenant lite loans may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan that has fewer restrictions typically does not include the legal clauses which allow an investor to proactively enforce financial tests or prevent or restrict undesired actions taken by the company or sponsor. Covenant lite loans also generally give the borrower/issuer more flexibility if they have met certain loan terms and provide fewer investor protections if certain criteria are breached.

The Fund seeks to maintain a well-diversified portfolio of credit instruments with dual objectives of interest income and total return opportunities. The Advisor considers both quantitative and qualitative factors in its evaluation and selection of investments for the Fund. Quantitative measures include the review of company financial statements and analysis of the company's projected future financial position. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor could choose to sell a particular security if, for example, it no longer satisfies specific criteria based on the quantitative and qualitative factors outlined above, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**PENN CAPITAL MID CAP CORE FUND**

**Investment Objective and Principal Investment Strategies**

*Investment Objective*

The Penn Capital Mid Cap Core Fund seeks to provide capital appreciation. This objective and the Fund's investment strategies are non-fundamental and may be changed by the Board without shareholder approval.

*Principal Investment Strategies*

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in equity securities of mid-capitalization companies. Shareholders will be given at least 60 days advance notice of any change to the 80% investment policy. Mid-capitalization companies are defined for this purpose as companies with market capitalizations at the time of purchase between (i) the lesser of $2 billion or the market capitalization of the smallest company included in the Bloomberg US 2500 Index, and (ii) the greater of $20 billion or the market capitalization of the largest company included in the Bloomberg US 2500 Index. As of October 31, 2022, the minimum and maximum market capitalizations included in the Bloomberg US 2500 Index were approximately $19 million and $17.8 billion, respectively. The Fund is not required to sell equity securities whose market values appreciate or depreciate outside this market capitalization range.

In selecting investments for the Fund, the Advisor incorporates ESG issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

Equity securities in which the Fund invests include common stock; preferred stock; equity-equivalent securities such as convertible securities; other investment companies, including ETFs; ADRs; and REITs. The Fund is also permitted to invest in private placements in these types of securities. The Fund generally invests in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund also has the ability to invest in other investment companies, including ETFs, that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein. Investment companies that have a policy of investing at least 80% of their assets in equity securities of small and mid-capitalization companies or investments that provide exposure to small and mid-capitalization companies may be used to satisfy the Fund's 80% investment policy. Investments in investment companies and ETFs also are permitted to manage the Fund's cash holdings. ADRs are equity securities traded on U.S. securities exchanges, which are generally issued by banks or trust companies to evidence ownership of foreign equity securities. ADRs may be sponsored or unsponsored. REITs are pooled investment vehicles that invest primarily in income-producing real estate or real estate-related loans or interests. In addition, the Fund may have increased exposure to investments in the financials sector. The Fund may invest more than 25% of its assets in dividend-paying securities. The Fund also may invest up to 25% of its net assets in foreign equity securities.

The Fund generally intends to invest in approximately 50 to 90 equity securities identified by the Advisor's fundamental, bottom-up value driven research. The portfolio construction process involves both quantitative and qualitative fundamental analysis. Quantitative measures include the review of company financial statements and analysis of the company's financial metrics relative to its peer group. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor could choose to sell a security when, for example, in the Advisor's determination, it no longer represents an attractive growth prospect, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**PENN CAPITAL SPECIAL SITUATIONS SMALL CAP EQUITY FUND**

**Investment Objective and Principal Investment Strategies**

*Investment Objective*

The Penn Capital Special Situations Small Cap Equity Fund seeks to provide capital appreciation. This objective and the Fund's investment strategies are non-fundamental and may be changed by the Board without shareholder approval.

*Principal Investment Strategies*

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in equity securities of small-capitalization companies. Shareholders will be given at least 60 days advance notice of any change to the 80% investment policy. Small-capitalization companies are defined for this purpose as companies with market capitalizations at the time of purchase between the lesser of $100 million or the market capitalization of the smallest company included in the Bloomberg US 2000 Index and the greater of $4 billion or the market capitalization of the largest company included in the Bloomberg US 2000 Index. As of October 31, 2022, the minimum and maximum market capitalizations included in the Bloomberg US 2000 Index were approximately $19 million and $7.5 billion, respectively. The Fund is not required to sell equity securities whose market values appreciate or depreciate outside this market capitalization range.

In selecting investments for the Fund, the Advisor incorporates ESG issues into its research and analysis, including, but not limited to, an assessment of the following factors: evaluation of a company's management team, board and leadership structure, share structure and overall business practices. Each investment decision incorporates ESG and sustainability to the extent that any of these ESG factors impact the financial health or reputational risk of the company within the capital markets.

Equity securities in which the Fund invests include common stock; preferred stock; equity-equivalent securities such as convertible securities; other investment companies, including ETFs; ADRs; and REITs. The Fund also is permitted to invest in private placements in these types of securities. In addition, the Fund may have increased exposure to investments in the financials and consumer discretionary sectors. The Fund generally invests in the securities of leveraged companies (*i.e.*, companies that issue debt). The Fund also has the ability to invest in other investment companies, including ETFs, that have investment objectives similar to the Fund's or that otherwise are permitted investments with the Fund's investment policies described herein. Investment companies that have a policy of investing at least 80% of their assets in equity securities of small-capitalization companies or investments that provide exposure to small-capitalization companies may be used to satisfy the Fund's 80% investment policy. ADRs are equity securities traded on U.S. securities exchanges, which are generally issued by banks or trust companies to evidence ownership of foreign equity securities. ADRs may be sponsored or unsponsored. REITs are pooled investment vehicles that invest primarily in income-producing real estate or real estate-related loans or interests. The Fund may invest up to 25% of its net assets in foreign equity securities.

The Fund generally intends to invest in approximately 50 to 90 equity securities identified by the Advisor's fundamental, bottom-up value driven research. The portfolio construction process involves both quantitative and qualitative fundamental analysis. Quantitative measures include the review of company financial statements and analysis of the company's financial metrics relative to its peer group. Qualitative measures include evaluation of management, identification of market leaders within industries, and due-diligence research regarding customers, competitors and suppliers. The Advisor could choose to sell a security when, for example, in the Advisor's determination, it no longer represents an attractive growth prospect, or to take advantage of what the Advisor has determined to be a better investment opportunity.

The Fund anticipates a higher than average portfolio turnover rate.

**TEMPORARY INVESTMENTS (All Funds)**

In order to respond to adverse market, economic, political or other conditions, each Fund may assume a temporary defensive position that is inconsistent with its investment objective and principal investment strategies and may invest, without limitation, in cash, cash equivalents or other high quality short-term investments. Temporary defensive investments generally may include short-term U.S. government securities, high-grade commercial paper, bank obligations, repurchase agreements, money market fund shares, money market deposit accounts, and other money market instruments. The Advisor also may invest in these types of securities or hold cash while looking for suitable investment opportunities or to maintain liquidity. A defensive position, taken at the wrong time, may have an adverse impact on a Fund's performance. A Fund may be unable to achieve its investment objective during the employment of a temporary defensive measure.

**PRINCIPAL RISKS**

An investment in a Fund is subject to one or more of the principal risks identified in the following table. The identified principal risks are discussed in more detail in the disclosure that immediately follows the table.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Penn Capital Floating Rate Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Special Situations Small Cap Equity Fund** |
| ADR Risk | | | | X | X |
| Agent Insolvency Risk | X | X | X | |  |
| Bank Loan Risk | X | X | X | |  |
| Convertible Securities Risk | | X | X | X | X |
| Consumer Discretionary Sector Risk | | | | X | X |
| Credit Risk | X | X | X | |  |
| Debt/Fixed Income Securities Risk | X | X | X | |  |
| Dividend-Paying Securities Risk | | | | X |  |
| ESG Investing Risk | X | X | X | X | X |
| ETF Risk | X | X | X | X | X |
| Financials Sector Risk | X | X | X | X | X |
| Focused Investment Risk | | | | X | X |
| Foreign Currency Risk | X | X | X | X | X |
| Foreign Securities Risk | X | X | X | X | X |
| Health Care Sector Risk | | | | X | X |
| High Yield Securities Risk | X | X | X | |  |
| Income Risk | X | X | X | |  |
| Industrials Sector Risk | | | | X | X |
| Information Technology Sector Risk | | | | X | X |
| Interest Rate Risk | X | X | X | |  |
| Investments in Other Investment Companies Risk | X | X | X | X | X |
| Leveraged Companies Risk | X | X | X | X | X |
| LIBOR Transition Risk | X | X | X | |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Penn Capital Floating Rate Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Special Situations Small Cap Equity Fund** |
| Liquidity Risk | X | X | X | X | X |
| Management Risk | X | X | X | X | X |
| Market Risk | X | X | X | X | X |
| Maturity Risk | X | X | X | |  |
| Mid-Capitalization Companies Risk | | | | X |  |
| Payment-In-Kind Securities Risk | | | X | |  |
| Portfolio Turnover Risk | X | X | X | X | X |
| Preferred Stock Risk | | | X | X | X |
| Prepayment/Extension Risk | X | X | X | |  |
| Private Placement Risk | X | X | X | X | X |
| Rating Agencies Risk | X | X | X | |  |
| Redemption Risk | X | X | X | X | X |
| REIT Risk | X | X | X | X | X |
| Small-Capitalization Companies Risk | | | | X | X |
| Volatility Risk | X | X | X | X | X |

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As with all mutual funds, there is the risk that you could lose all or a portion of your investment in a Fund. An investment in a Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation ("FDIC") or any other government agency. There is no assurance that a Fund will achieve its investment objective, and an investment in a Fund is not by itself a complete or balanced investment program. The following provides additional information regarding the principal risks that could affect the value of your investment:

**ADR Risk.** ADRs are subject to some of the same risks as direct investment in foreign companies, which includes international trade, currency, political, regulatory and diplomatic risks. In a sponsored ADR arrangement, the foreign issuer assumes the obligation to pay some or all of the depositary's transaction fees. Under an unsponsored ADR arrangement, the foreign issuer assumes no obligations and the depositary's transaction fees are paid directly by the ADR holders. Because unsponsored ADR arrangements are organized independently and without the cooperation of the issuer of the underlying securities, available information concerning the foreign issuer may not be as current as for sponsored ADRs and voting rights with respect to the deposited securities are not passed through.

**Agent Insolvency Risk.** In a syndicated loan, the agent bank is the bank in the syndicate that undertakes the bulk of the administrative duties involved in the day-to-day administration of the loan. In the event of the insolvency of an agent bank, a loan could be subject to settlement risk as well as the risk of interruptions in the administrative duties performed in the day to day administration of the loan.

**Bank Loan Risk.** There are a number of risks associated with an investment in senior floating rate bank loans, including credit risk, interest rate risk, liquidity risk and prepayment risk. Lack of an active trading market, restrictions on resale, irregular trading activity, wide bid/ask spreads and extended trade settlement periods in excess of seven days all would likely impair the Fund's ability to sell bank loans within its desired time frame or at an acceptable price and its ability to accurately value existing and prospective investments. Extended trade settlement periods may result in cash not being immediately available to the Fund. As a result of such illiquidity, the Fund may have to sell other investments or engage in borrowing transactions to raise cash to meet its obligations.

Bank loans in which the Fund invests have similar risks to below investment grade fixed income securities. Changes in the financial condition of the borrower or economic conditions or other circumstances could reduce the capacity of the borrower to make principal and interest payments on such instruments and may lead to defaults. Secured bank loans are supported by collateral; however, the value of the collateral may be insufficient to cover the amount owed to the Fund. If the Fund relies on a third party to administer a loan, the Fund is subject to the risk that the third party will fail to perform its obligations. In addition, if the Fund holds only a participation interest in a loan made by a third party, the Fund's receipt of payments on the loan will be dependent on the third party's willingness and ability to make those payments to that Fund.

Loans generally are subject to legal or contractual restrictions on resale. The liquidity of loans, including the volume and frequency of secondary market trading in such loans, varies significantly over time and among individual loans. For example, if the credit quality of a loan unexpectedly declines significantly, secondary market trading in that loan can also decline for a period of time. During periods of infrequent trading, valuing a loan can be more difficult and buying and selling a loan at an acceptable price can be more difficult and delayed. Difficulty in selling a loan can result in a loss. Due to their subordination in the borrower's capital structure, subordinated loans involve a higher degree of overall risk than senior bank loans of the same borrower.

Subordinated loans generally are subject to similar risks as those associated with investments in senior loans, except that such loans are subordinated in payment and/or lower in lien priority to first lien holders or may be unsecured. In the event of default on a subordinated loan, the first priority lien holder has first claim to the underlying collateral of the loan. These loans are subject to the additional risk that the cash flow of the borrower and property securing the loan or debt, if any, may be insufficient to meet scheduled payments after giving effect to the senior unsecured or senior secured obligations of the borrower. This risk is generally higher for subordinated unsecured loans or debt that is not backed by a security interest in any specific collateral. Subordinated loans generally have greater price volatility than senior loans and may be less liquid. Although loan investments are generally subject to certain restrictive covenants in favor of the investors, many of these loans may from time to time be reissued or offered as "covenant lite" loans, which may entail potentially increased risk, because they may have fewer or no financial maintenance covenants or restrictions that would normally allow for early intervention and proactive mitigation of credit risk. In the event of a breach of a covenant in non-covenant lite loans or debt securities, lenders may have the ability to intervene and either prevent or restrict actions that may potentially compromise the company's ability to pay or lenders may be in a position to obtain concessions from the borrowers in exchange for a waiver or amendment of the specific covenant(s). In contrast, covenant lite loans do not always or necessarily offer the same ability to intervene or obtain additional concessions from borrowers. This risk is offset to varying degrees by the fact that the same financial and performance information may be available with or without covenants to lenders and the public alike and can be used to detect such early warning signs as deterioration of a borrower's financial condition or results. With such information, the portfolio managers are normally able to take appropriate actions without the help of covenants in the loans. Covenant lite bank loans, however, may foster a capital structure designed to avoid defaults by giving borrowers or issuers increased financial flexibility when they need it the most.

Floating interest rates vary with and are periodically adjusted to a generally recognized base interest rate such as the London Interbank Offered Rate ("LIBOR") or the Prime Rate. As of December 31, 2021, all non-U.S. dollar LIBOR publications have been phased out and a majority of U.S. dollar LIBOR settings will cease publication after June 30, 2023. There remains uncertainty regarding the future utilization of LIBOR and the nature of any replacement rate. See "Principal Risks - LIBOR Transition Risk" below.

**Consumer Discretionary Sector Risk.** Companies engaged in the consumer discretionary sector are affected by fluctuations in supply and demand and changes in consumer demographics and preferences. The success of consumer product manufacturers and retailers is tied closely to the performance of domestic and international economies. Moreover, changes in consumer spending as a result of world events, political and economic conditions, commodity price volatility, changes in interest and exchange rates, imposition of import controls, increased competition, depletion of resources and labor relations also may adversely affect these companies. Companies in the consumer discretionary sector depend heavily on disposable household income and consumer spending, and may be strongly affected by social trends and marketing campaigns. These companies may be subject to severe competition, which may have an adverse impact on their profitability.

**Convertible Securities Risk.** A convertible security is a bond, debenture, note, preferred stock, right, warrant or other security that may be converted into or exchanged for a prescribed amount of common stock or other security of the same or a different issuer or cash within a particular period of time at a specified price or formula. A convertible security generally entitles the holder to receive interest paid or accrued on debt securities or the dividend paid on preferred stock until the convertible security matures or is redeemed, converted or exchanged. Before conversion, convertible securities generally have characteristics similar to both debt and equity securities. Convertible securities ordinarily provide a stream of income with generally higher yields than those of common stock of the same or similar issuers. Convertible securities generally rank senior to common stock in a corporation's capital structure but are usually subordinated to comparable nonconvertible proportionate securities.

Convertible securities generally do not participate directly in any dividend increases or decreases of the underlying securities although the market prices of convertible securities may be affected by any dividend changes or other changes in the underlying securities. The Fund's investments in convertible securities may subject the Fund to the risks that prevailing interest rates, issuer credit quality and any call provisions may affect the value of the Fund's convertible securities. Rights and warrants entitle the holder to buy equity securities at a specific price for a specific period of time. Rights typically have a substantially shorter term than do warrants. Rights and warrants may be considered more speculative and less liquid than certain other types of investments in that they do not entitle a holder to dividends or voting rights with respect to the underlying securities nor do they represent any rights in the assets of the issuing company. Rights and warrants may lack a secondary market.

**Credit Risk.** Credit risk refers to the possibility that the issuer of the security will not be able to make principal and interest payments when due. Changes in an issuer's credit rating or the market's perception of an issuer's creditworthiness may also affect the value of a Fund's investment in that issuer. The degree of credit risk depends on both the financial condition of the issuer and the terms of the obligation. Securities rated in the four highest categories (S&P Global Ratings ("S&P") (AAA, AA, A and BBB), Fitch Ratings ("Fitch") (AAA, AA, A and BBB) or Moody's Investors Service, Inc. ("Moody's") (Aaa, Aa, A and Baa)) by the rating agencies are considered investment grade but they may also have some speculative characteristics, meaning that they carry more risk than higher-rated securities and may have problems making principal and interest payments in difficult economic climates. Investment grade ratings do not guarantee that bonds will not lose value or default.

A security issuer's default on its payment obligations to a Fund will cause the value of an investment in the Fund to decrease. Lower credit quality may lead to greater volatility in the price of a security and in shares of a Fund. Lower credit quality also may affect liquidity and make it difficult to sell the security. Default, or the market's perception that an issuer is likely to default, could reduce the value and liquidity of securities, thereby reducing the value of your investment in Fund shares. In addition, default may cause a Fund to incur expenses in seeking recovery of principal or interest on its portfolio holdings.

**Debt/Fixed Income Securities Risk.** The value of your investment in the Fund may change in response to changes in interest rates. An increase in interest rates may cause a fall in the value of the debt securities in which the Fund invests. The longer the duration of a debt security, the more its value typically falls in response to an increase in interest rates. The value of your investment in the Fund may change in response to the credit ratings of the Fund's portfolio of debt securities. The degree of risk for a particular security may be reflected in its credit rating. Generally, investment risk and price volatility increase as a security's credit rating declines. The financial condition of an issuer of a debt security held by the Fund may cause it to default or become unable to pay interest or principal due on the security. The Fund cannot collect interest and principal payments on a debt security if the issuer defaults. Prepayment and extension risks may occur when interest rates decline and issuers of debt securities experience acceleration in prepayments. The acceleration can shorten the maturity of the debt security and force the Fund to invest in securities with lower interest rates, reducing the Fund's return. Issuers may decrease prepayments of principal when interest rates increase, extending the maturity of the debt security and causing the value of the security to decline. Distressed debt securities involve greater risk of default or downgrade and are more volatile than investment grade securities. Distressed debt securities may also be less liquid than higher quality debt securities.

**Dividend-Paying Securities Risk.** Investment in dividend-paying stocks could cause the Fund to underperform similar small to medium capitalization funds that invest without consideration of a company's track record of paying dividends. Stocks of companies with a history of paying dividends may not participate in favorable markets to the same degree as other stocks, and other factors, such as an increase in interest rates or severe economic downturn could cause a company to unexpectedly decrease or even eliminate its dividend.

**ESG Investing Risk.** ESG investing risk is the risk stemming from the ESG factors that the Fund may apply in selecting securities. This may affect the Fund's exposure to certain companies or industries and cause the Fund to forego certain investment opportunities. As a result, the Fund may invest in companies that do not reflect the beliefs and values of any particular investor. Investors may differ in their views of ESG characteristics. The Fund's returns may be lower than other funds that do not use ESG ratings.

**ETF Risk.** Investments in ETFs (which may, in turn, invest in equities, bonds, and other financial vehicles) may involve duplication of certain fees and expenses. By investing in an ETF, the Fund becomes a shareholder of that ETF. As a result, Fund shareholders indirectly bear their proportionate share of the ETF's fees and expenses which are paid by the Fund as an ETF shareholder. These fees and expenses are in addition to the fees and expenses that Fund shareholders directly bear in connection with the Fund's own operations. If the ETF fails to achieve its investment objective, the Fund's investment in the ETF may adversely affect the Fund's performance. In addition, because ETFs are listed on national stock exchanges and are traded like stocks listed on an exchange, (1) the Fund may acquire ETF shares at a discount or premium to their net asset value per share ("NAV") and (2) ETFs are subject to brokerage and other trading costs, which could result in greater expenses to the Fund. Trading of ETFs may be halted by the activation of individual or marketwide trading halts, or if the ETFs are delisted from an exchange. Finally, because the value of ETF shares depends on the demand in the market, the Advisor may not be able to liquidate the Fund's holdings at the most optimal time, adversely affecting the Fund's performance.

**Financials Sector Risk.** Performance of companies in the financials sector may be adversely impacted by many factors, including, among others, government regulations, economic conditions, credit rating downgrades, changes in interest rates, and decreased liquidity in credit markets. The impact of more stringent capital requirements, recent or future regulation of any individual financial company or of the financials sector as a whole cannot be predicted. In recent years, cyber attacks and technology malfunctions and failures have become increasingly frequent in this sector and have caused significant losses to companies in this sector, which may negatively impact the Fund.

**Focused Investment Risk.** If the Fund focuses its investments in the securities of a particular issuer or companies in a particular country, group of countries, region, market, industry, group of industries, sector or asset class, the Fund's exposure to various risks will be heightened, including price volatility and adverse economic, market, political or regulatory occurrences affecting that issuer, country, group of countries region, market, industry, group of industries, sector or asset class.

**Foreign Currency Risk.** The U.S. dollar value of foreign investments may be negatively affected by changes in foreign (non-U.S.) currency rates. Currency exchange rates can fluctuate significantly over short periods of time.

**Foreign Securities Risk.** If the Fund invests in foreign securities and ADRs, an investment in that Fund may have the following additional risks:

● foreign securities may be subject to greater fluctuations in price than securities of U.S. companies because foreign markets may be smaller and less liquid than U.S. markets;

● changes in foreign tax laws, exchange controls, investment regulations and policies on nationalization and expropriation as well as political instability may affect the operations of foreign companies and the value of their securities;

● fluctuations in currency exchange rates and currency transfer restitution may adversely affect the value of the Fund's investments in foreign securities, which are denominated or quoted in currencies other than the U.S. dollar;

● foreign securities and their issuers are not subject to the same degree of regulation as U.S. issuers regarding information disclosure, insider trading and market manipulation. There may be less publicly available information on foreign companies and foreign companies may not be subject to uniform accounting, auditing, and financial standards as are U.S. companies;

● foreign securities registration, custody and settlements may be subject to delays or other operational and administrative problems;

● certain foreign brokerage commissions and custody fees may be higher than those in the United States;

● dividends payable on the foreign securities contained in the Fund's portfolio may be subject to foreign withholding taxes, thus reducing the income available for distribution to the Fund's shareholders; and

● prices for stock or ADRs may fall over short or extended periods of time.

Additionally, in February 2022, Russia commenced a military attack on Ukraine. The outbreak of hostilities between the two countries and the threat of wider-spread hostilities could have a severe adverse effect on the region and global economies, including significant negative impacts on the markets for certain securities and commodities, such as oil and natural gas. In addition, sanctions imposed on Russia by the United States and other countries, and any sanctions imposed in the future, could have a significant adverse impact on the Russian economy and related markets. The price and liquidity of investments may fluctuate widely as a result of the conflict and related events. How long the armed conflict and related events will last cannot be predicted. These tensions and any related events could have a significant impact on Fund performance and the value of Fund investments, even beyond any direct exposure the Fund may have to issuers located in these countries.

**Health Care Sector Risk.** Health care companies may rely significantly on government funding or subsidies. If government support for health care companies is reduced or discontinued, the profitability of these companies could be adversely affected. The health care sector may also be affected by evolving government regulation. Health care companies are also subject to the risk of malpractice and products liability claims or other litigation. Intense competition may also adversely impact the profitability of issuers in the health care sector.

**High Yield Securities Risk.** Securities rated below investment grade, *i.e.*, Ba or BB and lower ("junk" bonds), are subject to greater risks of loss of your money than higher rated securities. Compared with issuers of investment grade fixed-income securities, junk bonds are more likely to encounter financial difficulties and to be materially affected by these difficulties.

**Income Risk.** Income risk is the possibility that the Fund's income will decline because of falling interest rates. The Fund holding bonds will experience a decline in income when interest rates fall because the Fund then must invest new cash flow and cash from maturing bonds in lower yielding bonds. Income risk is generally higher for funds holding short-term bonds and lower for funds holding long-term bonds.

**Industrials Sector Risk.** The industrials sector includes companies engaged in the manufacture and distribution of capital goods, such as those used in defense, construction and engineering, companies that manufacture and distribute electrical equipment and industrial machinery and those that provide commercial and transportation services and supplies. Companies in the industrials sector may be adversely affected by changes in government regulation, world events and economic conditions. In addition, companies in the industrials sector may be adversely affected by environmental damages, product liability claims, labor disputes and exchange rates.

**Information Technology Sector Risk.** The information technology (IT) sector has historically been relatively volatile due to the rapid pace of product development within the sector. Products and services of IT companies may not achieve commercial success or may become obsolete quickly. Stock prices of companies operating within this sector may be subject to abrupt or erratic movements. Additionally, these companies are subject to significant competitive pressures, such as new market entrants, aggressive pricing and tight profit margins. The activities of these companies may also be adversely affected by changes in government regulations.

**Interest Rate Risk.** If the Fund invests in fixed income securities, the value of your investment in that Fund may change in response to changes in interest rates. An increase in interest rates may cause a fall in the value of the fixed income securities in which the Fund invests, while a decrease in interest rates may cause a rise in the value of the fixed income securities in which the Fund invests. The longer the duration of a fixed income security, the more its value typically falls in response to an increase in interest rates. Duration measures the sensitivity of a security's price to changes in interest rates. This measure incorporates a security's coupon, maturity, and call features, among other factors. Changes in interest rates will affect the value of higher-quality securities more than lower-quality securities. Interest rate changes can be sudden and unpredictable, and are influenced by a number of factors including government policy, inflation expectations and supply and demand. A substantial increase in interest rates may have an adverse impact on the liquidity of a security, especially those with longer maturities. Changes in government monetary policy, including changes in tax policy or changes in a central bank's implementation of specific policy goals, may have a substantial impact on interest rates. There can be no guarantee that any particular government or central bank policy will be continued, discontinued or changed nor that any such policy will have the desired effect on interest rates.

**Investments in Other Investment Companies Risk.** Investments in other investment companies, including money market funds, may involve duplication of certain fees and expenses. By investing in other investment companies, the Fund becomes a shareholder of that company. As a result, Fund shareholders indirectly bear their proportionate share of the other investment company's fees and expenses which the Fund pays as a shareholder of the other investment company. These fees and expenses are in addition to the fees and expenses that Fund shareholders directly bear in connection with the Fund's own operations. If the other investment company fails to achieve its investment objective, the Fund's investment in the other investment company may adversely affect the Fund's performance.

**Leveraged Companies Risk.** Securities of leveraged companies tend to be more sensitive to issuer, political, market and economic developments than the market as a whole and the securities of other types of companies. A decrease in the credit quality of a leveraged company can lead to a significant decrease in the value of the company's securities. Leveraged companies can have limited access to additional capital, which can limit their ability to capitalize on attractive business opportunities and make it more difficult for them to weather challenging business environments.

Companies with leveraged capital structures may be undergoing difficult business circumstances. These companies may face a greater risk of liquidation, reorganization or bankruptcy than companies with lower levels of leverage. In the event of liquidation, reorganization or bankruptcy, a company's creditors take precedence over the company's stockholders, which makes recovery of those stockholders' investment relatively less likely.

**LIBOR Transition Risk.** Many financial instruments may be tied to the London Interbank Offered Rate, or "LIBOR," to determine payment obligations, financing terms, hedging strategies, or investment value. LIBOR is the offered rate for short-term Eurodollar deposits between major international banks. As of December 31, 2021, all non-U.S. dollar LIBOR publications have been phased out and a majority of U.S. dollar LIBOR settings will cease publication after June 30, 2023. It is possible that a subset of LIBOR settings will be published after these dates on a "synthetic" basis, but any such publications would be considered non-representative of the underlying market. The U.S. Federal Reserve, based on the recommendations of the New York Federal Reserve's Alternative Reference Rate Committee (comprised of major derivative market participants and their regulators), has begun publishing the Secured Overnight Financing Rate (SOFR) that is intended to replace U.S. dollar LIBOR. Proposals for alternative reference rates for other currencies have also been announced or have already begun publication. Markets are slowly developing in response to these new reference rates. Uncertainty related to the liquidity impact of the change in rates, and how to appropriately adjust these rates at the time of transition, poses risks for the Fund. The effect of any changes to, or discontinuation of, LIBOR on the Fund will depend on, among other things, (1) existing fallback or termination provisions in individual contracts and (2) whether, how, and when industry participants develop and adopt new reference rates and fallbacks for both legacy and new instruments and contracts. The expected discontinuation of LIBOR could have a significant impact on the financial markets in general and may also present heightened risk to market participants, including public companies, investment advisers, investment companies, and broker-dealers. The risks associated with this discontinuation and transition will be exacerbated if the work necessary to effect an orderly transition to an alternative reference rate is not completed in a timely manner. For example, current information technology systems may be unable to accommodate new instruments and rates with features that differ from LIBOR. Accordingly, it is difficult to predict the full impact of the transition away from LIBOR on the Fund until new reference rates and fallbacks for both legacy and new instruments and contracts are commercially accepted and market practices become settled.

**Liquidity Risk.** Certain securities held by the Fund may be difficult (or impossible) to sell at the time and at the price the Advisor would like. As a result, the Fund may have to hold these securities longer than it would like and may forego other investment opportunities. There is the possibility that the Fund may lose money or be prevented from realizing capital gains if it cannot sell a security at a particular time and price. Illiquidity may result from political, economic or issuer specific events; changes in a specific market's size or structure, including the number of participants; or overall market disruptions. Liquid portfolio investments may become illiquid or less liquid after purchase by the Fund due to low trading volume, adverse investor perceptions and/or other market developments. Liquidity risk includes the risk that the Fund will experience significant net redemptions at a time when it cannot find willing buyers for its portfolio securities or can only sell its portfolio securities at a material loss. Liquidity risk can be more pronounced in periods of market turmoil. It may be more difficult for the Fund to determine an accurate good faith fair value of an illiquid investment than that of a more liquid comparable investment. If the Fund sells investments with extended settlement times, such as loans, the settlement proceeds from the sales may not be available to meet the Fund's redemption obligations for a substantial period of time.

**Management Risk.** Each Fund is actively managed and its performance may reflect the Advisor's ability to make decisions which are suited to achieving the Fund's investment objectives. Due to its active management, the Fund could underperform other mutual funds with similar investment objectives.

**Market Risk.** The market values of securities owned by the Fund will go up or down, sometimes rapidly or unpredictably. Securities or other investments may decline in value due to factors affecting individual issuers, securities markets generally or sectors within the securities markets. The value of a security may go up or down due to general market conditions which are not specifically related to a particular issuer, such as real or perceived adverse economic conditions, changes in interest rates or adverse investor sentiment generally. They may also go up or down due to factors that affect an individual issuer or a particular sector. During a general downturn in the securities markets, multiple asset classes may decline in value. When markets perform well, there can be no assurance that securities held by the Fund will participate in or otherwise benefit from the advance. Stock prices tend to go up and down more dramatically than those of debt securities. A slower-growth or recessionary economic environment could have an adverse effect on the prices of the various stocks held by the Fund.

The outbreak of the novel strain of coronavirus, COVID-19, has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain the spread of COVID-19 have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, heightened unemployment, reduced consumer demand, debt defaults and other significant economic impacts, all of which have disrupted global economic activity across many industries and may exacerbate other pre-existing political, social and economic risks, locally or globally. The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Funds' performance.

Governmental and quasi-governmental authorities and regulators throughout the world have in the past responded to major economic disruptions with a variety of significant fiscal and monetary policy changes, including but not limited to, direct capital infusions into companies, new monetary programs and dramatically lower interest rates. Policy changes subsequent to the implementation of these measures, such as increases in interest rates, may expose fixed-income and related markets to heightened volatility and may reduce liquidity for certain fixed income investments, including fixed income investments held by the Funds, which could cause the value of the Funds' investments and share prices to decline.

**Maturity Risk.** Generally, a bond with a longer maturity will entail greater interest rate risk but have a higher yield. Conversely, a bond with a shorter maturity will entail less interest rate risk but have a lower yield.

**Mid-Capitalization Companies Risk.** If the Fund invests in mid-capitalization companies, an investment in that Fund may have the following additional risks:

● analysts and other investors typically follow these companies less actively and therefore information about these companies is not always readily available;

● changes in the value of mid-capitalization company stocks may not mirror the fluctuation of the market;

● more limited product lines, markets and financial resources make these companies more susceptible to economic or market setbacks; and

● mid-capitalization companies may be particularly affected by interest rate increases, as they may find it more difficult to borrow money to continue or expand operations, or may have difficulty in repaying any loans.

For these and other reasons, the prices of mid-capitalization securities can fluctuate more significantly than the securities of larger companies. The smaller the company, the greater effect these risks may have on that company's operations and performance. As a result, an investment in the Fund may exhibit a higher degree of volatility than the general domestic securities market.

**Payment-In-Kind Securities Risk.** Payment-in-kind securities may be subject to greater fluctuation in value and less liquidity in the event of adverse market conditions than comparably rated securities paying cash interest at regular interest payment periods. Prices on non-cash-paying instruments may be more sensitive to changes in the issuer's financial condition, fluctuation in interest rates and market demand/supply imbalances than cash-paying securities with similar credit ratings, and thus may be more speculative. Investors may purchase payment-in-kind securities at a price below the amount payable at maturity. Because such securities do not entitle the holder to any periodic payments of interest prior to maturity, this prevents any reinvestment of interest payments at prevailing interest rates if prevailing interest rates rise. The higher yields and interest rates on payment-in-kind securities reflect the payment deferral and increased credit risk associated with such instruments and that such investments may represent a higher credit risk than coupon loans. Payment-in-kind securities may have a potential variability in valuations because their continuing accruals require continuing judgments about the collectability of the deferred payments and the value of any associated collateral. Special tax considerations are associated with investing in certain lower-grade securities, such as payment-in-kind securities.

**Portfolio Turnover Risk.** The Advisor's tactical investment process is expected to result in a high portfolio turnover rate. High portfolio turnover, or frequent trading, involves correspondingly greater expenses, such as brokerage commissions or dealer mark-ups and other transaction costs on the sale of securities and reinvestments in other securities, and may result in higher taxable gains. Increased transaction costs could detract from the Fund's performance.

**Preferred Stock Risk.** Preferred stocks are subject to the risks associated with other types of equity securities, as well as additional risks, such as potentially greater volatility and risks related to deferral, non-cumulative dividends, subordination, liquidity, limited voting rights, and special redemption rights.

**Prepayment/Extension Risk.** In connection with the Fund's investments in fixed income securities, the Fund may be forced to invest in securities with lower yields and thus reducing its income if issuers prepay certain fixed income securities. Issuers may decrease prepayments of principal when interest rates increase, extending the average life and duration of a fixed income security and causing the value of the security to decline.

**Private Placement Risk.** The Fund may invest in privately issued securities, including those which may be resold only in accordance with Rule 144A under the Securities Act of 1933, as amended. Privately issued securities are restricted securities that are not registered with the SEC. Accordingly, the liquidity of the market for specific privately issued securities may vary. Delay or difficulty in selling such securities may result in a loss to the Fund. Privately issued securities that the Advisor determines to be "illiquid" are subject to the Fund's policy of not investing more than 15% of its net assets in illiquid investments.

**Rating Agencies Risk.** The value of your investment in the Fund may change in response to the credit ratings of that Fund's portfolio securities. The degree of risk for a particular security may be reflected in its credit rating. Generally, investment risk and price volatility increase as a security's credit rating declines. Ratings are not an absolute standard of quality, but rather general indicators that reflect only the view of the originating rating agencies from which an explanation of the significance of such ratings may be obtained. There is no assurance that a particular rating will continue for any given period of time or that any such rating will not be revised downward or withdrawn entirely if, in the judgment of the agency establishing the rating, circumstances so warrant. A downward revision or withdrawal of such ratings, or either of them, may have an effect on the liquidity or market price of the securities in which the Fund invests. The ratings of securitized assets may not adequately reflect the credit risk of those assets due to their structure.

Rating agencies may fail to make timely changes in credit ratings and an issuer's current financial condition may be better or worse than a rating indicates. In addition, rating agencies are subject to an inherent conflict of interest because they are often compensated by the same issuers whose securities they grade.

**Redemption Risk.** The Fund may experience periods of heavy redemptions that could cause the Fund to liquidate its assets at inopportune times or at a loss or depressed value, particularly during periods of declining or illiquid markets. Redemption risk is greater to the extent that the Fund has investors with large shareholdings, short investment horizons or unpredictable cash flow needs. In addition, redemption risk is heightened during periods of overall market turmoil. The redemption by one or more large shareholders of their holdings in the Fund could hurt performance and/or cause the remaining shareholders in the Fund to lose money. If one decision maker has control of Fund shares owned by separate Fund shareholders, including clients of the Advisor, redemptions by these shareholders may further increase the Fund's redemption risk. If the Fund is forced to liquidate its assets under unfavorable conditions or at inopportune times, the value of your investment could decline.

**REIT Risk.** A REIT's performance depends on the types, values and locations of the properties it owns and how well those properties are managed. A decline in rental income may occur because of extended vacancies, increased competition from other properties, tenants' failure to pay rent or poor management. Because a REIT may be invested in a limited number of projects or in a particular market segment, it may be more susceptible to adverse developments affecting a single project or market segment than more broadly diversified investments. The risk of defaults is generally higher in the case of mortgage pools that include subprime mortgages (which refer to loans made to borrowers with weakened credit histories or with a lower capacity to make timely payments, and second-lien mortgage loans), and a decline in or flattening of property values also may exacerbate losses. Loss of status as a qualified REIT under the U.S. federal tax laws could adversely affect the value of a particular REIT or the market for REITs as a whole. These risks may also apply to securities of REIT-like entities domiciled outside the U.S.

**Small-Capitalization Companies Risk.** If the Fund invests in small-capitalization companies, an investment in the Fund may have the following additional risks:

● analysts and other investors typically follow these companies less actively and therefore information about these companies is not always readily available;

● securities of many smaller companies are traded in the over-the-counter markets or on a regional securities exchange potentially making them thinly traded, less liquid and their prices more volatile than the prices of the securities of larger companies;

● changes in the value of smaller company stocks may not mirror the fluctuation of the market;

● more limited product lines, markets and financial resources make these companies more susceptible to economic or market setbacks; and

● small-capitalization companies may be particularly affected by interest rate increases, as they may find it more difficult to borrow money to continue or expand operations, or may have difficulty in repaying any loans.

For these and other reasons, the prices of small-capitalization securities can fluctuate more significantly than the securities of larger companies. The smaller the company, the greater effect these risks may have on that company's operations and performance. As a result, an investment in the Fund may exhibit a higher degree of volatility than the general domestic securities market.

**Volatility Risk.** The value of securities in the Fund's portfolio may go down. The Fund's portfolio will reflect changes in the prices of individual portfolio securities or general changes in securities valuations. Consequently, the Fund's share price may decline and you could lose money.

**MANAGEMENT OF THE FUNDS**

**Organization.** Each Fund is a series of The RBB Fund Trust (the "Trust"). The Board oversees the business of the Trust and the Funds. The Board meets periodically to review each Fund's performance, monitor investment activities, and discuss other matters affecting the Funds. Additional information regarding the Board, as well as the Trust's executive officers, may be found in the Funds' Statement of Additional Information ("SAI").

**Investment Advisor.** Penn Capital Management Company, LLC, Navy Yard Corporate Center, 1200 Intrepid Avenue, Suite 400, Philadelphia, Pennsylvania 19112, is the Funds' investment advisor. The Advisor has provided investment advisory and management services to clients since 1987. As of September 30, 2022, the Advisor had approximately $1.7 billion in assets under advisement.

The Advisor receives an advisory fee from each Fund at an annual rate of each Fund's average daily net assets as indicated below the "Current Contractual Advisory Fee" column in the table. For the fiscal year ended August 31, 2022, the Advisor received, after applicable fee waivers, an advisory fee at an annual rate of each of the following Fund's average daily net assets as indicated below the "Net Advisory Fee Received" column in the table.

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| | | |
|:---|:---|:---|
| | **Current**<br> **Contractual**<br> **Advisory Fee** | **Net Advisory Fee**<br> **Received for Fiscal**<br> **Year Ended 8/31/22**  |
| Penn Capital Floating Rate Income Fund | 0.55% | 0.08% |
| Penn Capital Short Duration High Income Fund | 0.45% | 0.11% |
| Penn Capital Opportunistic High Income Fund | 0.69% | 0.00% |
| Penn Capital Mid Cap Core Fund | 0.90% | 0.47% |
| Penn Capital Special Situations Small Cap Equity Fund | 0.95% | 0.46% |

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With respect to each Fund other than the Penn Capital Opportunistic High Income Fund and the Penn Capital Short Duration High Income Fund, the Advisor has contractually agreed to waive its fees and/or pay Fund expenses so that the Funds' total annual operating expenses (excluding any acquired fund fees and expenses, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) do not exceed the amounts shown below.

With respect to the Penn Capital Opportunistic High Income Fund and the Penn Capital Short Duration High Income Fund, the Advisor has contractually agreed to waive its fees and/or pay Fund expenses so that the Fund's total annual operating expenses (including any acquired fund fees and expenses incurred by the Fund as a result of its investments in other investment companies managed by the Advisor, but excluding any acquired fund fees and expenses incurred by the Fund as a result of its investments in unaffiliated investment companies, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) do not exceed the amounts shown below. The expense limitation agreements will remain in place through December 31, 2023, and will be reviewed each year, at which time the continuation of the expense limitation agreements will be discussed by the Advisor and the Board. The expense limitation agreements also provide that the Advisor is entitled to be reimbursed by a Fund for any fees it waived and/or expenses it paid for a period of three years following the month of the fee waiver or payment, to the extent such reimbursement will not cause the Fund to exceed any applicable expense limit that was in place when the fees were waived or expenses paid.

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| | |
|:---|:---|
| | **Institutional** <br> **Class**  |
| Penn Capital Floating Rate Income Fund | 0.64% |
| Penn Capital Short Duration High Income Fund | 0.54% |
| Penn Capital Opportunistic High Income Fund | 0.72% |
| Penn Capital Mid Cap Core Fund | 1.06% |
| Penn Capital Special Situations Small Cap Equity Fund | 1.09% |

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At its own expense, the Advisor may compensate certain financial institutions, including the Funds' distributor, for providing distribution and distribution-related services and/or for performing certain administrative/shareholder servicing functions for the benefit of the Funds' shareholders. These payments may create an incentive for such financial institutions to recommend the purchase of the Funds' shares.

A discussion regarding the basis for the Board's approval of the investment advisory agreement between the Trust and the Advisor on behalf of the Penn Capital Short Duration High Income Fund, Penn Capital Mid Cap Core Fund, Penn Capital Special Situations Small Cap Equity Fund, Penn Capital Opportunistic High Income Fund and Penn Capital Floating Rate Income Fund is available in the Funds' <u>annual report</u> to shareholders for the fiscal year ended August 31, 2022.

*The Advisor's Equity Team is overseen by Eric J. Green, CFA.*

● Eric J. Green, CFA, is the Chief Investment Officer of Equity, Senior Portfolio Manager, and Senior Managing Partner. Mr. Green has oversight responsibility for the Advisor's equity portfolio strategies. Mr. Green joined the Advisor in 1997. Previously, Mr. Green was a financial analyst with the SEC in the Division of Investment Management. Mr. Green received a B.S./B.A., cum laude, from the Kogod School of Business, American University, and an M.B.A. from the Yale School of Management.

*The Advisor's Credit Team is overseen by Peter R. Duffy, CFA.*

● Peter R. Duffy, CFA is the Chief Investment Officer of Credit, Senior Portfolio Manager and Senior Managing Partner. Mr. Duffy joined the Advisor in 2006. Previously, Mr. Duffy was a Director for Deutsche Asset Management and a Manager of Finance for GE Capital, as well as Management Consultant for Arthur Andersen LLP. Mr. Duffy received a B.S., summa cum laude, from Villanova University, and an M.B.A. from The Wharton School of the University of Pennsylvania.

**Portfolio Managers.**

***Penn Capital Floating Rate Income Fund***

The portfolio manager primarily responsible for the Penn Capital Floating Rate Income Fund's day-to-day management is:

**Peter R. Duffy, CFA, Chief Investment Officer of Credit, Senior Portfolio Manager, and Senior Managing Partner.** Information about Mr. Duffy is provided above. Mr. Duffy has managed the Fund since May 2022.

***Penn Capital Short Duration High Income Fund***

The portfolio manager primarily responsible for the Penn Capital Short Duration High Income Fund's day-to-day management is:

**Peter R. Duffy, CFA, Chief Investment Officer of Credit, Senior Portfolio Manager, and Senior Managing Partner.** Information about Mr. Duffy is provided above. Mr. Duffy has managed the Fund since inception.

***Penn Capital Opportunistic High Income Fund***

The portfolio manager primarily responsible for the Penn Capital Opportunistic High Income Fund's day-to-day management is:

**Peter R. Duffy, CFA, Chief Investment Officer of Credit, Senior Portfolio Manager, and Senior Managing Partner.** Information about Mr. Duffy is provided above. Mr. Duffy has managed the Fund since May 2022.

***Penn Capital Mid Cap Core Fund***

The portfolio manager primarily responsible for the Penn Capital Mid Cap Core Fund's day-to-day management is:

**Joseph C. Maguire, CFA, Director of Research, Senior Portfolio Manager, Chair of the Equity Risk Committee and Senior Managing Partner.** Mr. Maguire joined the Advisor in 2005. Previously, he was with Acquisition Management Services, Inc. and PricewaterhouseCoopers LLP. Mr. Maguire received a B.B.A. from The College of William and Mary and an M.B.A. from the Kenan-Flagler Business School at the University of North Carolina at Chapel Hill. Mr. Maguire has managed the Fund since inception.

***Penn Capital Special Situations Small Cap Equity Fund***

The portfolio manager primarily responsible for the Penn Capital Special Situations Small Cap Equity Fund's day-to-day management is:

**Eric J. Green, CFA, Chief Investment Officer of Equity**, **Senior Portfolio Manager, and Senior Managing Partner.** Information about Mr. Green is provided above. Mr. Green has managed the Fund since inception.

The SAI provides additional information about each portfolio manager's compensation arrangements, other accounts managed, and ownership of shares in the Funds that they manage.

**Fund Distributor.** Foreside Fund Services, LLC, the Trust's principal underwriter (the "Distributor"), acts as the Trust's distributor in connection with the offering of Fund shares. The Distributor may enter into arrangements with banks, broker-dealers and other financial intermediaries through which investors may purchase or redeem shares. The Distributor is not affiliated with the Advisor, U.S. Bank Global Fund Services, U.S. Bank National Association or their affiliates.

**Fund Transfer Agent, Administrator and Accountant.** U.S. Bancorp Fund Services, LLC doing business as U.S. Bank Global Fund Services serves as the Funds' administrator, fund accountant, transfer agent and dividend disbursing agent (the "Transfer Agent").

**Custodian.** U.S. Bank National Association, an affiliate of U.S. Bank Global Fund Services, serves as the Funds' custodian (the "Custodian"). The Custodian and the Transfer Agent are affiliates.

**Disclosure of Portfolio Holdings.** A description of the Funds' policies and procedures with respect to the disclosure of each Fund's portfolio securities is available in the SAI, which is available without charge on the Funds' website at www.penncapitalfunds.com and by calling the Funds at 1-844-302-PENN (7366).

**INSTITUTIONAL CLASS OF SHARES**

**When and How NAV is Determined.** Each Fund's share price is known as its NAV. The NAV is determined by dividing the value of the Fund's securities, cash and other assets, minus all liabilities, by the number of shares outstanding (assets – liabilities / number of shares = NAV). The NAV takes into account the expenses and fees, including management, administration and other fees, which are accrued daily. Each Fund's share price is calculated as of the close of regular trading (generally 4:00 p.m., Eastern Time) on each day the NYSE is open for business. The Funds do not determine the NAV on any day when the NYSE is not open for trading, such as weekends and certain national holidays, including New Year's Day, Martin Luther King Jr. Day, President's Day, Good Friday, Memorial Day, Juneteenth National Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.

Securities and other assets for which market quotations are readily available are generally priced at their market value. If market quotations are readily available for portfolio securities listed on a securities exchange, a Fund values those securities at the official closing price of the day or, if there is no official closing price, at the most recent quoted bid price. Because a Fund may invest in foreign securities, a Fund's NAV may change on days when a shareholder will not be able to purchase or redeem Fund shares because foreign markets are open at times and on days when U.S. markets are not. Investments quoted in foreign currencies will be valued daily in U.S. dollars on the basis of the foreign currency exchange rates prevailing at the time such valuation is determined. Foreign currency exchange rates are generally determined as of the close of the NYSE. Fixed income securities and bank loans are generally priced on the basis of valuations provided by an approved independent pricing service. Independent pricing services value fixed income securities and bank loans at an evaluated bid price by employing methodologies that use actual market transactions, broker-supplied valuations or other methodologies designed to identify the market value for such securities. A Fund's portfolio holdings may also consist of shares of other investment companies in which the Fund invests. The value of each such investment company will be its NAV at the time the Fund's shares are priced. Each investment company calculates its NAV based on the current market value for its portfolio holdings. Each investment company values securities and other instruments in a manner as described in that investment company's prospectus. The investment company's prospectus explains the circumstances under which the company will use fair value pricing and the effects of using fair value pricing. For all other securities, methods approved by the Board are used that are designed to price securities at their fair market values.

**Fair Value Determinations.** Occasionally, reliable market quotations are not readily available (such as for certain restricted or unlisted securities and private placements) or securities and other assets may not be reliably priced (such as in the case of trade suspensions or halts, price movement limits set by certain foreign markets, and thinly traded or illiquid securities), or there may be events affecting the value of foreign securities or other securities held by the Funds that occur when regular trading on foreign or other exchanges is closed, but before trading on the NYSE is closed. Fair value determinations are then made in good faith in accordance with procedures adopted by the Board. Under the procedures adopted by the Board, the Board has delegated the responsibility for making fair value determinations to the Advisor as valuation designee, subject to the Board's oversight. Generally, the fair value of a portfolio security or other asset shall be the amount that the owner of the security or asset might reasonably expect to receive upon its current sale.

Because the Funds may invest in securities that are traded primarily in foreign markets, a significant gap in time can exist between the time of a particular security's last trade on a foreign market, and the time at which a Fund calculates its NAV. If an event that could materially affect the value of a Fund's securities has occurred between the time the securities were last traded and the time that a Fund calculates its NAV, the closing price of a Fund's securities may no longer reflect their market value at the time the Fund calculates its NAV. In such a case, the Fund may use fair value methods to value such securities.

Attempts to determine the fair value of securities introduce an element of subjectivity to the pricing of securities. As a result, the price of a security determined through fair valuation techniques may differ from the price quoted or published by other sources and may not accurately reflect the market value of the security when trading resumes. If a reliable market quotation becomes available for a security formerly valued through fair valuation techniques, the Fund would compare the new market quotation to the fair value price to evaluate the effectiveness of its fair valuation determination. If any significant discrepancies are found, a Fund may adjust its fair valuation procedures.

**About Institutional Class Shares.**

Eligible investors who purchase Institutional Class shares may do so at the Funds' NAV without a sales charge or other fee.

Certain financial intermediaries that make the Funds' shares available to their customers may charge fees in addition to those described in this Prospectus for providing certain services, including: marketing, distribution or other services intended to assist in the offer and sale of Fund shares; shareholder servicing activities; and/or sub-transfer agency services provided to individual shareholders or beneficial owners where a financial intermediary maintains omnibus accounts with the Funds' Transfer Agent. The Advisor or its affiliates may pay all or a portion of those fees out of their own resources (that is, without additional cost to a Fund or its shareholders). The compensation is discretionary and may be available only to selected selling and servicing agents. The amount of fees paid to a financial intermediary in any given year will vary and may be based on one or more factors, including a fixed amount, a fixed percentage rate, a financial intermediary's sales of Fund shares, assets in Fund shares held by the intermediary's customers, or other factors. In addition, consistent with applicable regulations, the Advisor or its affiliates may from time to time pay for or make contributions to financial intermediaries or their employees in connection with various activities including: training and education seminars for financial intermediary employees, clients and potential clients; due diligence meetings regarding the Funds; recreational activities; gifts; and/or other non-cash items. See the SAI for a discussion of marketing and support payments and sub-transfer agency policies.

The Trust has adopted a Shareholder Servicing Plan (the "Servicing Plan") that allows the Funds to pay servicing fees to intermediaries such as banks, broker-dealers, financial advisers or other financial institutions that provide shareholder services, such as for sub-administration, sub-transfer agency and other shareholder services associated with shareholders whose shares are held of record in omnibus accounts, other group accounts or accounts traded through registered securities clearing agents. Under the Servicing Plan, each Fund may pay servicing fees to such intermediaries at an annual rate not to exceed 0.15% of the average daily value of net assets. Because these fees are paid out of the Funds' assets on an ongoing basis, over time these fees will increase the cost of your investment and may cost you more than other types of charges.

**Institutional Class Shares**

Institutional Class shares are offered primarily to investors such as pension and profit-sharing plans, employee benefit trusts, endowments, foundations, corporations, and high net worth individuals. Institutional Class shares also may be offered through certain financial intermediaries that charge their customers transaction or other service fees with respect to their customers' investments in the Funds.

Pension and profit-sharing plans, employee benefit trusts and employee benefit plan alliances, and "wrap account" or "managed fund" programs established with broker-dealers or financial intermediaries that maintain an omnibus or pooled account for a Fund and do not require a Fund or the Advisor to pay an annual administrative or service fee greater than 0.25% generally may purchase Institutional Class shares, subject to investment minimums and any applicable waivers.

The minimum initial investment for Institutional Class shares is $10,000. The Advisor may waive the initial minimum in certain circumstances, including but not limited to the following:

\* Transfers of shares from existing accounts if the registration or beneficial owner remains the same.

\* Employees of the Advisor and its affiliates and their families.

\* Employee benefit plans sponsored by the Advisor.

\* Certain wrap or other fee based programs offered by financial intermediaries.

\* Trustees of the Trust and their families.

\* Institutional clients of the Advisor.

\* An investment that officers of the Trust determine, in their sole discretion, would not adversely affect the Advisor's ability to manage a Fund effectively.

\* Defined contribution plans of at least $5 million or defined contribution plans that the Advisor believes will reach the $10,000 minimum within the first year.

\* The minimum initial investment for registered investment advisors purchasing shares for their clients through transaction fee programs is $10,000 per Fund or as stipulated by the clearing platform.

Before making an investment in Institutional Class shares, you should call the Fund at 1-844-302-PENN (7366) to determine if you are eligible to invest in Institutional Class shares. You will receive an application form and further instructions on how to invest. The Funds' Transfer Agent must receive your completed application before you may make an initial investment.

**HOW TO BUY, SELL, EXCHANGE AND TRANSFER SHARES**

The Funds do not issue share certificates.

In compliance with the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the "USA PATRIOT Act"), please note that the Transfer Agent will verify certain information on your application as part of the Funds' Anti-Money Laundering Program. As requested on the application, you must supply your full name, date of birth, social security number and permanent street address. Mailing addresses containing only a P.O. Box will not be accepted. Please contact the Transfer Agent if you need additional assistance with your application.

If the Funds do not have a reasonable basis for determining your identity, the account will be rejected or you will not be allowed to perform transactions on the account until the necessary information to confirm your identity is received. In the rare event that we are unable to verify your identity, the Fund reserves the right to redeem your account at the current day's net asset value. The Funds reserve the right to reject purchases, or suspend or redeem an account, without the owner's permission, if the Funds reasonably believe there is suspicious, fraudulent, or illegal activity in the account.

The Funds' shares have not been registered for sale outside of the United States.

If you are opening an account in the name of a certain legal entity (*e.g.*, a partnership, limited liability company, business trust, corporation, etc.), you must also supply the identity of the beneficial owners of the legal entity. Accounts opened by entities such as corporations, limited liability companies, partnerships or trusts, will require additional documentation.

**Buying Shares**

*Determine the amount of your investment.*

For Institutional Class shares, the minimum initial investment is $10,000. There is no minimum initial investment for retirement plans. (The minimums for initial investments may be reduced or waived under certain circumstances.)

Financial advisors, broker-dealers, bank trust departments, or other financial intermediaries offering asset allocation models or other fee-based programs may have initial investment minimums of less than $2,500. Consult your investment professional for the minimum initial investment specified by the program's provider.

*Have your financial consultant, selected securities dealer or other financial intermediary submit your purchase order.*

In addition to purchasing shares directly from the Funds, you may invest through financial services companies such as banks, trust companies, investment advisors or broker-dealers that have made arrangements to offer Fund shares for sale. Such financial intermediaries, in turn, are authorized to designate other financial intermediaries to receive purchase orders for Fund shares from investors.

The price of your shares is based on the next calculation of NAV after receipt of your order. Purchase orders must be received in "good order" and the Fund reserves the right to reject any transaction instructions that are not in good order. "Good order" means that your purchase request includes: (i) the Fund's name and share class, (ii) the dollar amount of shares to be purchased, (iii) your purchase application or investment stub, and (iv) a check payable to the Fund in which you are investing, or, if paying by wire, receipt of Federal funds. The requirements for good order may be revised at any time and without prior notice.

Purchase orders received in good order prior to the close of regular trading on the NYSE (generally, 4:00 p.m., Eastern time) are priced at the NAV determined that day. If a purchase order is received by a financial intermediary (including any authorized designee thereof) prior to 4:00 p.m., Eastern time, such order will be deemed by the Fund to have been received prior to the deadline for receiving that day's NAV. Certain financial intermediaries, however, may require submission of orders prior to 4:00 p.m. Eastern time.

Purchase orders received after 4:00 p.m. Eastern time are priced based on the NAV determined on the next business day. The Fund may reject any order to buy shares and may suspend the sale of shares at any time. Certain financial intermediaries may charge a fee to process a purchase.

**Purchase Through the Transfer Agent**

*Purchase By Mail*

Send a completed account application along with a check payable to The RBB Fund Trust to the following address:

*(regular mail)* 

The RBB Fund Trust

c/o U.S. Bank Global Fund Services

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

*(overnight)* 

The RBB Fund Trust

c/o U.S. Bank Global Fund Services

615 E. Michigan Street, 3rd Floor

Milwaukee, Wisconsin 53202-5207

The Funds do not consider the U.S. Postal Service or other independent delivery services to be their agents. Therefore, deposit in the mail or with such services, or receipt at the U.S. Bank Global Fund Services post office box, of purchase orders or redemption requests does not constitute receipt by the Funds' Transfer Agent. Receipt of purchase orders or redemption requests occurs when the order is received at the Transfer Agent's offices.

Checks must be drawn on a U.S. bank in U.S. dollars for the exact amount of the purchase. You will receive the NAV next determined after the Transfer Agent receives your check and completed application. The Funds will not accept payment in cash, money orders, U.S. Treasury checks, credit card checks, traveler's checks, starter checks, drafts or third party checks. The Funds are unable to accept post-dated checks or any conditional order or payment. If your check does not clear, you will be charged a $25 service charge and for any other losses sustained by the Funds.

*Purchase By Wire*

If you are making your first investment in the Funds through a wire purchase, the Transfer Agent must have a completed account application before you wire funds. You may mail or overnight deliver your account application to the Transfer Agent. Upon receipt of your completed account application, the Transfer Agent will establish an account for you. The account number assigned will be required as part of the instruction that should be provided to your financial institution to send the wire. Your financial institution must include the name of the Fund you are purchasing, the account number, and your name so that the wire may be correctly applied. Your bank should transmit funds by wire to:

U.S. Bank National Association

777 East Wisconsin Avenue

Milwaukee, WI 53202

ABA #075000022

For credit to U.S. Bancorp Fund Services, LLC

Account #112-952-137

Further Credit: The RBB Fund Trust, [INSERT FUND NAME HERE]

[SHAREHOLDER NAME - SHAREHOLDER ACCOUNT #]

Federal fund purchases will only be accepted on a day on which the Funds and the Custodian are open for business. Wired funds must be received prior to 4:00 p.m., Eastern time to be eligible for same day pricing. The Funds and U.S. Bank National Association are not responsible for the consequences of delays resulting from the banking or Federal Reserve wire system, or from incomplete wiring instructions.

**Add to Your Investment**

*Purchase additional shares*

The minimum investment for additional purchases is generally $100. (The minimums for additional purchases may be waived under certain circumstances.)

If you purchased your shares through the Transfer Agent, Invest by Mail forms for additional contributions are included with your confirmation statement or by calling 1-844-302-PENN (7366). If you do not have the Invest by Mail form, include the Fund name and share class, your name, address, and account number on a separate piece of paper along with your check.

You may also purchase additional shares via wire. Before sending your wire, please contact the Transfer Agent to advise them of your intent to wire funds. This will ensure prompt and accurate credit of your wire.

Your financial consultant, selected securities dealer or other financial intermediary may also submit your order.

*Acquire additional shares through the automatic dividend reinvestment plan*

Unless you elect to receive dividends in cash, all dividends are automatically reinvested.

*Participate in the automatic investment plan*

You may invest a specific amount on a periodic basis through the Transfer Agent. The current minimum for such automatic investments is $100 (subsequent to the minimum initial investment). The minimum may be waived or revised under certain circumstances. To participate in the plan, your financial institution must be a member of the Automated Clearing House ("ACH") network. You may change or terminate your participation in the plan at any time by notifying the Transfer Agent five (5) calendar days prior to your next transaction. To change your financial institution, a signature guarantee or signature validation may be required. If your financial institution rejects your transaction, the Transfer Agent will charge a $25 fee to your account. Selected securities dealers or other financial intermediaries may also offer automatic investment plans.

**Sell Your Shares**

The price of your shares is based on the next calculation of NAV after receipt of your order. For your redemption request to be priced at the NAV on the day of your request, you must submit your request to your selected securities dealer or other financial intermediary (or an authorized designee thereof) prior to that day's close of regular trading on the NYSE (generally, 4:00 p.m., Eastern time).

Certain financial intermediaries, however, may require submission of orders prior to that time. Redemption requests received after that time are priced at the NAV at the close of regular trading on the next business day. Certain financial intermediaries may charge a fee to process a sale of shares.

The Fund may reject an order to sell shares under certain circumstances permitted by the SEC, including during unusual market conditions or emergencies when the Fund can't determine the value of its assets or sell its holdings.

*Your financial consultant, selected securities dealer or other financial intermediary may submit your sales order.*

*Sell through the Transfer Agent*

You may sell shares held at the Transfer Agent by writing to the Transfer Agent at the address on the back cover of this Prospectus. All shareholders on the account must sign the letter. The Transfer Agent may require a signature guarantee for certain redemption requests. Signature guarantees can be obtained from domestic banks, brokers, dealers, credit unions, national securities exchanges, registered securities associations, clearing agencies and savings associations, as well as from participants in the New York Stock Exchange Medallion Signature Program and the Securities Transfer Agents Medallion Program ("STAMP"), but not from a notary public. A signature guarantee, from either a Medallion program member or a non-Medallion program member, of each account owner is required in the following situations: (i) when a single redemption request would result in a redemption of more than $100,000, (ii) when redemption proceeds are payable or sent to any person, address or bank account not on record, (iii) when a redemption request is received by the Transfer Agent and the address on record to where the proceeds are being sent has changed within 30 calendar days, or (iv) when the account's ownership is being changed. The Funds reserve the right to waive the signature guarantee requirement. Non-financial transactions including establishing or modifying certain services on an account may require a signature guarantee, signature verification from a Signature Validation Program member or other acceptable form of authentication from a financial institution source. In addition to the situations described above, the Funds and/or the Transfer Agent reserve the right to require a signature guarantee or signature validation in other instances based on the circumstances relative to the particular situation. You can obtain a signature guarantee from a bank, securities dealer, securities broker, credit union, savings association, national securities exchange or registered securities association. A notary public seal will not be acceptable. You may have to supply additional documentation at the request of the Transfer Agent, depending on the type of account. Shareholders who have an IRA or other retirement plan must indicate on their written redemption request whether to withhold federal income tax. Redemption requests failing to indicate an election will generally be subject to a 10% withholding. Shares held in IRA accounts may be redeemed by telephone at 1-844-302-PENN (7366). Investors will be asked whether or not to withhold taxes from any distribution.

All redemption requests received in good order by the Transfer Agent before the close of regular trading on the NYSE (generally 4:00 p.m., Eastern time) will be processed that day and the proceeds will usually be sent the next day. "Good order" means your letter of instruction includes: (i) the Fund's name; (ii) the number of shares or dollar amount of shares to be redeemed; (iii) signatures of all registered shareholders exactly as the shares are registered and a signature guarantee, when applicable; and (iv) the account number. You may have a check sent to the address of record, proceeds may be wired to your pre-determined financial institution account or proceeds may be sent via electronic funds transfer through the ACH network using instructions previously provided to the Transfer Agent for your account. There is a $15 fee for outgoing wire transfers. In all cases, proceeds will be processed within seven calendar days following a properly completed request. If you make a redemption request before a Fund has collected payment for the purchase of shares, the Fund or the Transfer Agent may delay mailing your proceeds. This delay usually will not exceed 12 calendar days from the date of purchase.

You may also sell shares held at the Transfer Agent by telephone request if the amount being sold does not exceed $100,000 and if certain other conditions are met. Contact the Transfer Agent at 1-844-302-PENN (7366) for details. If an account has more than one owner or authorized person, the Transfer Agent will accept telephone instructions from any one owner or authorized person.

**Sell Shares Systematically**

*Participate in a Fund's Systematic Withdrawal Plan*

You can choose to receive systematic payments from your Fund account either by check or through direct deposit to your financial institution account of at least $100 per payment if you have at least $10,000 in your account. You can generally arrange through the Transfer Agent or your selected securities dealer or other financial intermediary for systematic sales of shares of a fixed dollar amount as frequently as monthly, subject to certain conditions. You may elect to change or terminate your participation in this Plan at any time by contacting the Transfer Agent at least five calendar days prior to the next scheduled withdrawal. Under either method, you should have dividends automatically reinvested.

Ask your financial intermediary or the Transfer Agent for details. Each withdrawal is generally a taxable event for federal income tax purposes.

**Exchange Your Shares**

*Select the Fund into which you want to exchange.*

You can exchange your Institutional Class shares of a Fund for Institutional Class shares in an identically registered account of another Penn Capital Fund subject to the policies and procedures adopted by the participating securities dealer or other financial intermediary and to the policies described below. The minimum exchange amount is $2,500. Exchanges generally are considered a sale for federal income tax purposes.

Institutional Class shares of a Fund generally are exchangeable for Institutional Class shares of another Penn Capital Fund.

To exercise the exchange privilege, contact your financial consultant, selected securities dealer or other financial intermediary or call the Transfer Agent at 1-844-302-PENN (7366).

**Transfer Shares to Another Securities Dealer or Other Financial Intermediary**

*Transfer to a participating securities dealer or other financial intermediary*

You may transfer your Fund shares to another selected securities dealer or other financial intermediary if authorized dealer agreements are in place between the Distributor and the transferring intermediary and the Distributor and the receiving intermediary. Certain shareholder services may not be available for all transferred shares. All future trading of these assets must be coordinated by the receiving intermediary.

*Transfer to a non-participating securities dealer or other financial intermediary*

You must either:

● Transfer your shares to an account with the Transfer Agent or

● Sell your shares.

The Funds encourage, if possible, advance notification of large redemptions. It is anticipated that a Fund will meet redemption requests through the sale of portfolio assets or from its holdings in cash or cash equivalents. A Fund may use the proceeds from the sale of portfolio assets to meet redemption requests if consistent with the management of the Fund. These redemption methods will be used regularly and may also be used in stressed or abnormal market conditions, including circumstances adversely affecting the liquidity of a Fund's investments, in which case a Fund may be more likely to be forced to sell its holdings to meet redemptions than under normal market conditions. Each Fund reserves the right to redeem in kind as described below in the section "Additional Information Regarding Purchases and Redemptions." Redemptions in kind typically are used to meet redemption requests that represent a large percentage of a Fund's net assets in order to limit the impact of a large redemption on the Fund and its remaining shareholders. Redemptions in kind may be used in normal as well as in stressed market conditions. A Fund may also borrow, or draw on lines of credit that may be available to the Fund individually or to the Trust, in order to meet redemption requests during stressed market conditions. Under the 1940 Act, a Fund is limited as to the amount that it may borrow and accordingly, borrowings (including those made under a line of credit) might be insufficient to meet redemption requests.

During periods of substantial economic or market change, you may find telephone redemptions difficult to implement and may encounter higher than usual call waits. Telephone trades must be received by or prior to market close. Please allow sufficient time to place your telephone transaction prior to market close. If a servicing agent or shareholder cannot contact the Transfer Agent by telephone, they should make a redemption request in writing in the manner described earlier. Once a telephone transaction has been placed, it cannot be canceled or modified after the close of regular trading on the NYSE (generally, 4:00 p.m., Eastern time). Before executing an instruction received by telephone, the Transfer Agent will use reasonable procedures to confirm that the telephone instructions are genuine. The telephone call may be recorded and the caller may be asked to verify certain personal identification information. If the Fund or its agents follow these procedures, they cannot be held liable for any loss, expense or cost arising out of any telephone redemption request that is reasonably believed to be genuine. This includes fraudulent or unauthorized requests. If an account has more than one owner or authorized person, the Funds will accept telephone instructions from any one owner or authorized person.

**Right to Suspend Sales and Reject Purchase Orders.** The Funds reserve the right to suspend the offering of shares at any time, and to reject a purchase order.

The Advisor and the Funds are dedicated to minimizing or eliminating short-term and/or active trading in the Funds. Purchases and exchanges of Fund shares should be made for long-term investment purposes. Short-term or excessive trading into or out of a Fund may harm other shareholders in various ways, including disrupting portfolio management strategies, increasing brokerage and administrative costs, and causing the Fund to generate taxable gains. To protect the interests of the Fund's long-term shareholders, the Board has adopted the following policies and has authorized the Advisor to make adjustments to specific provisions in these policies as necessary to ensure their effectiveness.

The Funds discourage frequent purchases and redemptions of Fund shares, whether for "market timing" or any other purpose. Accordingly, the Funds reserve the right to reject any purchase or exchange request for any reason, including transactions representing excessive trading and transactions accepted by any shareholder's financial intermediary. For example, a Fund may reject any purchase order, including an exchange, from any investor who, in the Advisor's opinion, has a pattern of short-term or excessive trading in the Funds or whose trading has been disruptive to a Fund.

The Funds monitor trading activity in a variety of ways. Active trading within a 30-day period will generally be questioned if the trades meet certain thresholds for materiality. However, the Funds may reject trades from any shareholder who the Funds believe is engaged in excessive trading, whether or not in violation of these guidelines. The Funds may consider trading patterns over a longer period than 30 days and may take into account market conditions, the number of trades and the amount of the trades in making such determinations. In applying these policies, the Funds consider the information available to them at the time and reserve the right to consider trading activity in multiple accounts under common ownership, control, or influence. Additionally, these guidelines may be changed at any time without prior notice to shareholders.

When excessive or short-term trading is detected, the party involved may be banned from future trading in the Funds. Judgments related to the rejection of purchases and the banning of future trades are inherently subjective and involve some selectivity in their application. The Advisor will seek to make judgments and applications that are consistent with the interests of the Funds' shareholders.

Persons engaged in excessive trading practices may use a variety of strategies to avoid detection, such as trading through multiple financial intermediaries or within omnibus accounts that pool transactions together in one account. The Funds may not be able to effectively monitor or detect excessive or short-term trading that occurs through financial intermediaries, particularly in an omnibus account. It is common for a substantial portion of Fund shares to be held in omnibus accounts. The Funds may not always be able to detect or curtail excessive or short-term trading in omnibus accounts, which may harm shareholders as described above.

In addition, the Funds attempt to limit exchanges in retirement plans, which often trade in omnibus accounts, to no more than one round-trip exchange per participant within a 30-day period. It is the responsibility of plan sponsors to communicate the Funds' restrictions to plan participants and monitor and apply the exchange limitation. The exchange limits may be modified to conform to individual plan exchange limits, Department of Labor regulations and automated asset allocation or dollar-cost-averaging programs. Certain automated or pre-established exchange, asset allocation and dollar-cost-averaging programs may not be subject to these exchange limits.

The Distributor may enter into agreements with respect to financial advisers and other financial intermediaries that maintain omnibus accounts with the Transfer Agent pursuant to which such financial advisors and other financial intermediaries undertake to cooperate with the Advisor and the Distributor in monitoring purchase, exchange and redemption orders by their customers in order to detect and prevent short-term or excessive trading of the Funds' shares through such accounts. Certain plan recordkeepers may offer the Funds a menu of options designed to limit active trading. These options may include blocking of exchanges or round-trip limitations for certain time periods. Generally, the Funds prefer to implement buy blocks, whereby a participant who initiates a sale in a Fund would not be able to make a purchase for 30 days. This limitation does not include payroll contributions, rollovers, loan transactions, automatic rebalancing or other similar transactions. It may not be practical for each plan sponsor and/or recordkeeper to implement this systematic limitation or other short-term trading policies. The Funds will accept as adequate reasonable policies and procedures to detect and deter active trading even though those policies may not be as restrictive as those of the Funds. Shareholders who own Fund shares through plan sponsors may request copies of such policies and procedures from those plan sponsors and/or recordkeepers.

For purposes of application of these policies, the Funds generally do not consider the following types of transactions to be active trading (unless significant in size or frequency of trades):

● With respect to discretionary wrap programs, changes in investment models by research teams;

● "Rebalancing" transactions by brokers or investment advisors to align accounts with target portfolios;

● "Rebalancing" transactions by shareholders between taxable and non-taxable accounts;

● Sales and purchases effected for the purpose of changing the class of Fund shares held;

● Sales and purchases effected for the purpose of realizing tax gains/losses in order to offset other tax gains/losses; and

● Sales and purchases effected by plan sponsors, recordkeepers or other intermediaries for various operational purposes.

**ADDITIONAL INFORMATION REGARDING PURCHASES AND REDEMPTIONS**

In order to conduct transactions via the website, you will need your account number, user ID, and password. Payment for shares purchased or redeemed through the internet may be made only through electronic funds transfer via the Automated Clearing House ("ACH") using a predetermined bank account. Only bank accounts held at domestic financial institutions that are ACH members can be used for such transactions. You must have provided a voided check or savings deposit slip with which to establish your bank account instructions. Redemptions initiated via the website may also be paid by check to the address of record or by federal wire to the bank instructions on your account.

The Funds employ procedures to confirm that transactions entered through the internet are genuine. These procedures include passwords, encryption and other precautions reasonably designed to protect the integrity, confidentiality and security of shareholder information. The Fund and their transfer agent will not be responsible for any loss, liability or expense for any fraudulent or unauthorized instructions entered via the internet.

**Liquidating Small Accounts.** Because of the high cost of maintaining smaller shareholder accounts, if you redeem shares and your account balance falls below $500, the Funds may redeem all of your shares in your account after sixty (60) days' written notice to you. A redemption of all of your shares generally will be treated as a sale for federal income tax purposes and may be subject to tax.

**Brokerage Platforms.** Institutional Shares may also be available on certain brokerage platforms. An investor transacting in Institutional Shares through a broker that is acting as an agent for the investor may be required by such broker to pay a separate commission and/or other forms of compensation to their broker. Such broker commissions are not reflected in each Fund's fee table or expense examples.

**Responsibility for Fraud.** The Funds will not be responsible for any account losses due to fraud, so long as the Funds reasonably believe that the person transacting on an account is authorized to do so. Please protect your account information and keep it private. Contact the Funds immediately about any transactions you believe to be unauthorized.

**Retirement Distributions.** A request for distribution from an IRA or other retirement account may be delayed by the Funds pending proper documentation. If a shareholder does not want tax withholding from distributions, the shareholder may state in the distribution request that no withholding is desired and that the shareholder understands that there may be a liability for income tax on the distribution, including penalties for failure to pay estimated taxes.

**Redemption in Kind.** The Funds reserve the right to pay shareholders redeeming large amounts with, in whole or in part, securities instead of cash in certain circumstances. If your shares are thusly redeemed in kind, you will incur transaction costs when you subsequently sell the securities distributed to you. You should also understand that, as a result of subsequent market volatility, the net proceeds from the ultimate sale of any securities that you receive upon a redemption may vary, either positively or negatively, and perhaps significantly, from the redemption value of your Fund shares. Redemptions in kind are taxable for federal income tax purposes in the same manner as redemptions for cash.

**Lost Shareholders, Inactive Accounts and Unclaimed Property.** It is important that the Funds maintain a correct address for each shareholder. An incorrect address may cause a shareholder's account statements and other mailings to be returned to a Fund. Based upon statutory requirements for returned mail, the Funds will attempt to locate the shareholder or rightful owner of the account. If a Fund is unable to locate the shareholder, then the Fund will determine whether the shareholder's account can legally be considered abandoned. Your mutual fund account may be transferred to the state government of your state of residence if no activity occurs within your account during the "inactivity period" specified in your state's abandoned property laws. The Funds are legally obligated to escheat (or transfer) abandoned property to the appropriate state's unclaimed property administrator in accordance with statutory requirements. The shareholder's last known address of record determines which state has jurisdiction. Please proactively contact the Funds' Transfer Agent toll-free at 1-844-302-PENN (7366) at least annually to ensure your account remains in active status.

If you are a resident of the state of Texas, you may designate a representative to receive notifications that, due to inactivity, your mutual fund account assets may be delivered to the Texas Comptroller. Please contact the Transfer Agent if you wish to complete a Texas Designation of Representative form.

**Householding.** In order to control costs associated with mailings, the Funds will, until notified otherwise, send only one copy of each Prospectus, shareholder report and proxy statement to each household address that it has on record for you and your family members living in the same home.

This process, known as "householding," does not apply to account statements, confirmations or personal tax information. If you do not wish to participate in householding, or wish to discontinue householding at any time, call 1-844-302-PENN (7366). The Funds will resume separate mailings to you within 30 days of your request.

**DIVIDENDS, DISTRIBUTIONS, AND TAXES**

**Dividends and Distributions**

Each Fund intends to qualify each year as a regulated investment company under the Internal Revenue Code of 1986, as amended. As a regulated investment company, a Fund generally pays no federal income tax on the income and gains it distributes to you. The Penn Capital Opportunistic High Income Fund, the Penn Capital Floating Rate Income Fund, and the Penn Capital Short Duration High Income Fund expect to declare and distribute all of their net investment income, if any, to shareholders as dividends monthly. The Penn Capital Mid Cap Core Fund and the Penn Capital Special Situations Small Cap Equity Fund expect to declare and distribute all of their net investment income, if any, to shareholders as dividends annually. Each Fund will distribute net realized capital gains, if any, at least annually, usually in December. A Fund may distribute such income dividends and capital gains more frequently, if necessary, in order to reduce or eliminate federal excise or income taxes on the Fund. The amount of any distribution will vary, and there is no guarantee a Fund will pay either an income dividend or a capital gains distribution.

Distributions may be taken in cash or in additional shares at NAV. For Federal income tax purposes, distributions are treated the same whether they are received in cash or reinvested. Shares become entitled to receive distributions on the day after the shares are issued. Dividends and capital gain distributions will be automatically reinvested in additional shares unless a shareholder has elected, by written notice to the Funds, or by telephone, to receive dividends and capital gain distributions in cash. Any changes to the distribution option should be submitted at least 5 days in advance of the payment date for the distribution.

If you elect to receive distributions and/or capital gains paid in cash, and the U.S. Postal Service cannot deliver the check, or if a check remains outstanding for six months, the Funds reserve the right to reinvest the distribution check in your account, at the current NAV for the applicable Fund, and to reinvest all subsequent distributions.

**Annual Statements**

Each year, the Funds will send you an annual statement (Form 1099) of your account activity to assist you in completing your federal, state and local tax returns. Distributions declared in December to shareholders of record in such month, but paid in January, are taxable as if they were paid in December. Prior to issuing your statement, the Funds make every effort to reduce the number of corrected forms mailed to you. However, if a Fund finds it necessary to reclassify its distributions or adjust the cost basis of any covered shares (defined below) sold or exchanged after you receive your tax statement, the Fund will send you a corrected Form 1099.

**Taxes**

The following is a summary of certain United States tax considerations relevant under current law, which may be subject to change in the future. Except where otherwise indicated, the summary assumes you are a U.S. citizen or resident or otherwise subject to U.S. federal income tax. Potential investors should consult their tax advisers for further information regarding federal, state, local and/or foreign tax consequences relevant to their specific situations.

Each Fund contemplates declaring as dividends each year all or substantially all of its taxable income, including its net capital gain (the excess of net long-term capital gain over net short-term capital loss). Distributions attributable to the net capital gain of a Fund (including distributions attributable to net capital gains of underlying investment companies) will be taxable to you as long-term capital gain, regardless of how long you have held your shares. The maximum federal long-term capital gain rate applicable to individuals, estates, and trusts is 23.8% (which includes a 3.8% Medicare tax). Other Fund distributions will generally be taxable as ordinary income, except as discussed below. A portion of those distributions, however, may be treated as "qualified dividend income" taxable to non-corporate U.S. shareholders at long-term capital gain rates, as long as certain requirements are met. A distribution is treated as qualified dividend income to the extent a Fund or an underlying investment company receives dividend income from taxable domestic corporations and certain qualified foreign corporations, provided that the holding period and other requirements are met by the Fund, the underlying investment company and the shareholder. Additionally, a portion of the distributions paid by a Fund may be eligible for the dividends-received deduction for corporate shareholders. Except as otherwise discussed below, you will be subject to federal income tax on Fund distributions regardless of whether they are paid in cash or reinvested in additional shares. You will be notified annually of the tax status of distributions to you.

Distributions from a Fund will generally be taxable to you in the taxable year in which they are paid, with one exception. Distributions declared by a Fund in October, November or December and paid in January of the following year are taxed as though they were paid on December 31.

A Fund may be subject to foreign withholding or other foreign income taxes with respect to dividends or interest received from (and, in some cases, gains recognized on shares of stock of) non-U.S. companies. Under certain circumstances, a Fund may be eligible to make an election to treat a proportionate amount of those taxes as constituting a distribution to each shareholder, which would allow you either (1) to credit that proportionate amount of taxes against U.S. federal income tax liability as a foreign tax credit, subject to applicable limitations, or (2) to take that amount as an itemized deduction. The Fund may choose not to make this election.

You should note that if you purchase shares just before a distribution, the purchase price will reflect the amount of the upcoming distribution, but you will be taxed on the entire amount of the distribution received, even though, as an economic matter, the distribution simply constitutes a return of a portion of your purchase price. This adverse tax result is known as "buying into a dividend."

You will generally recognize taxable gain or loss for federal income tax purposes on a sale, exchange or redemption of your shares, based on the difference, if any, between your tax basis in the shares and the amount you receive for them. This gain or loss will generally be capital gain or loss if you hold your Fund shares as capital assets and will be long-term if you held your shares for more than twelve months at the time you dispose of them. Additionally, any loss realized on a disposition of shares of a Fund may be disallowed under "wash sale" rules to the extent the shares disposed of are replaced with other shares of the same Fund within a period of 61 days beginning 30 days before and ending 30 days after the shares are disposed of, such as pursuant to a dividend reinvestment in shares of the Fund. If disallowed, the loss will be reflected in an upward adjustment to the basis of the shares acquired.

Any loss realized on shares held for six months or less will be treated as a long-term capital loss to the extent of any capital gain dividends that were received on the shares.

For shares acquired on or after January 1, 2012, the Funds (or relevant broker or financial adviser) are required to compute and report to the Internal Revenue Service ("IRS") and furnish to Fund shareholders cost basis information when such shares are sold or exchanged. The Funds have elected to use the average cost method, unless you instruct the Funds to use a different IRS-accepted cost basis method, or choose to specifically identify your shares at the time of each sale or exchange. If your account is held by your broker or other financial adviser, they may select a different cost basis method. In these cases, please contact your broker or other financial adviser to obtain information with respect to the available methods and elections for your account. You should carefully review the cost basis information provided by the Funds and make any additional basis, holding period or other adjustments that are required when reporting these amounts on your federal and state income tax returns. Fund shareholders should consult with their tax advisers to determine the best IRS-accepted cost basis method for their tax situation and to obtain more information about how the cost basis reporting requirements apply to them.

The Funds may be required in certain cases to withhold and remit to the IRS a percentage of taxable dividends or gross proceeds realized upon sale payable to shareholders who have failed to provide a correct tax identification number in the manner required, or who are subject to withholding by the IRS for failure to properly include on their return payments of taxable interest or dividends, or who have failed to certify to the Fund that they are not subject to backup withholding when required to do so or that they are "exempt recipients." The current backup withholding rate is 24%.

***IRAs and Other Tax-Qualified Plans:*** One major exception to the preceding tax principles is that distributions on, and sales, exchanges and redemptions of, shares held in an IRA (or other tax-qualified plan) will not be currently taxable unless such shares were acquired with borrowed funds.

***U.S. Tax Treatment of Foreign Shareholders:*** Generally, nonresident aliens, foreign corporations and other foreign investors are subject to a 30% withholding tax on dividends paid by a U.S. corporation, although the rate may be reduced for an investor that is a qualified resident of a foreign country with an applicable tax treaty with the United States. In the case of regulated investment companies such as the Funds, however, certain categories of dividends are exempt from the 30% withholding tax. These generally include dividends attributable to the Funds' net capital gains (the excess of net long-term capital gains over net short-term capital losses), dividends attributable to the Funds' interest income from U.S. obligors and dividends attributable to net short-term capital gains of the Funds.

Foreign shareholders will generally not be subject to U.S. tax on gains realized on the sale, exchange or redemption of shares in the Funds, except that a nonresident alien individual who is present in the United States for 183 days or more in a calendar year will be taxable on such gains and on capital gain dividends from the Funds.

In contrast, if a foreign investor conducts a trade or business in the United States and the investment in a Fund is effectively connected with that trade or business, then the foreign investor's income from the Funds will generally be subject to U.S. federal income tax at graduated rates in a manner similar to the income of a U.S. citizen or resident.

The Funds will also generally be required to withhold 30% tax on certain payments to foreign entities that do not provide a Form W-8BEN-E that evidences their compliance with, or exemption from, specified information reporting requirements under the Foreign Account Tax Compliance Act.

All foreign investors should consult their own tax advisers regarding the tax consequences in their country of residence of an investment in the Funds.

Shares of the Funds have not been registered for sale outside of the United States and certain United States territories.

***State and Local Taxes:*** Shareholders may also be subject to state and local taxes on income and gain from Fund shares. Shareholders should consult their advisers regarding the tax status of distributions in their state and locality.

More information about taxes is contained in the Funds' SAI.

**FINANCIAL HIGHLIGHTS**

The following tables are intended to help you understand each Fund's financial performance for the periods shown. Certain information reflects financial results for a single Fund share. The total return figures represent the percentage that an investor would have earned (or lost) during each period on an investment in a Fund (assuming reinvestment of all dividends and distributions). This information for the fiscal year ended August 31, 2022, fiscal period ended August 31, 2021, and fiscal year ended June 30, 2021 was audited by Tait, Weller & Baker LLP, an independent registered public accounting firm, whose report, along with each Fund's financial statements and financial highlights, is included in the Funds' most recent <u>annual report</u> to shareholders. The information for the fiscal years ended June 30, 2020, 2019, and 2018 was audited by the Funds' former independent registered public accounting firm. You may obtain a copy of the Funds' most recent annual and semi-annual reports by contacting the Trust by telephone, mail, or by visiting <u>www.penncapitalfunds.com</u>.

---

| | | | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Per Common Share Data<sup>(a)</sup> | Supplemental data and ratios | Supplemental data and ratios | Supplemental data and ratios | Supplemental data and ratios | Supplemental data and ratios | Supplemental data and ratios |
|  | Income from <br> Investment operations  | Income from <br> Investment operations  | Income from <br> Investment operations  | Income from <br> Investment operations  | Distributions to <br> shareholders  | Distributions to <br> shareholders  | Distributions to <br> shareholders  | | | | | | | | |
|  | Net asset value, beginning of period | Net investment income (loss) | Net realized and unrealized gains (losses) | Total from investment operations | Dividends from net investment income | Distributions from capital gains | Total distributions |<br>Net asset value, end of period | <br>Total return<sup>(d)</sup> | Net assets, end of period <br> (in 000's) | Ratio of expenses to average net assets, including waivers and reimbursement<sup>(b)</sup> | Ratio of expenses to average net assets, excluding waivers and reimbursement<sup>(b)</sup> | Ratio of net investment income (loss) to average net assets, including waivers and reimbursement<sup>(b)</sup> | Ratio of net investment income (loss) to average net assets, excluding waivers and reimbursement<sup>(b)</sup> | Portfolio Turnover Rate<sup>(c)(d)</sup> |
| **Penn Capital Floating Rate Income Fund** | **Penn Capital Floating Rate Income Fund** | **Penn Capital Floating Rate Income Fund** | **Penn Capital Floating Rate Income Fund** | **Penn Capital Floating Rate Income Fund** | **Penn Capital Floating Rate Income Fund** | **Penn Capital Floating Rate Income Fund** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class |  |  |  |  |  |  |  |  |  |  |  |  |
| 9/1/21 to 8/31/22<sup>(e)</sup> | $9.68 | 0.35 | (0.49) | (0.14) | (0.35) |  | (0.35) | $9.19 | (1.48)% | $31049 | 0.64% | 1.11% | 3.71% | 3.24% | 49% |
| 7/1/21 to 8/31/21<sup>(e)</sup> | $9.70 | 0.05 | (0.02) | 0.03 | (0.05) |  | (0.05) | $9.68 | 0.32% | $31193 | 0.64% | 1.16% | 3.13% | 2.61% | 3% |
| 7/1/20 to 6/30/21 | $9.30 | 0.33 | 0.40 | 0.73 | (0.33) |  | (0.33) | $9.70 | 7.95% | $30685 | 0.64% | 1.52% | 3.41% | 2.53% | 46% |
| 7/1/19 to 6/30/20 | $9.97 | 0.42 | (0.67) | (0.25)<sup>(g)</sup> | (0.42) |  | (0.42) | $9.30 | (2.57)% | $35551 | 0.64% | 1.37% | 4.33% | 3.60% | 93% |
| 7/1/18 to 6/30/19 | $10.09 | 0.48 | (0.09) | 0.39 <sup>(g)</sup> | (0.51) |  | (0.51) | $9.97 | 4.04% | $37485 | 0.64% | 1.43% | 4.89% | 4.10% | 57% |
| 7/1/17 to 6/30/18 | $10.21 | 0.43 | (0.06) | 0.37 | (0.43) | (0.06) | (0.49) | $10.09 | 3.71% | $31729 | 0.65 | 1.64% | 4.31 | 3.32% | 65% |
| **Penn Capital Short Duration High Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Short Duration High Income Fund** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class |  |  |  |  |  |  |  |  |  |  |  |  |
| 9/1/21 to 8/31/22<sup>(e)</sup> | $9.73 | 0.29 | (0.58) | (0.29) | (0.29) |  | (0.29) | $9.15 | (3.05)% | $33905 | 0.54% | 0.88% | 3.02% | 2.68% | 54% |
| 7/1/21 to 8/31/21<sup>(e)</sup> | $9.74 | 0.05 | (0.01) | 0.04 | (0.05) |  | (0.05) | $9.73 | 0.41% | $43871 | 0.54% | 0.99% | 2.97% | 2.52% | 11% |
| 7/1/20 to 6/30/21 | $9.33 | 0.36 | 0.41 | 0.77 | (0.36) |  | (0.36) | $9.74 | 11.96% | $40180 | 0.54% | 1.16% | 3.77% | 3.15% | 104% |
| 7/1/19 to 6/30/20 | $9.93 | 0.37 | (0.59) | (0.22) | (0.38) |  | (0.38) | $9.33 | (2.33)% | $44462 | 0.54% | 1.15% | 3.87% | 3.26% | 113% |
| 7/1/18 to 6/30/19 | $9.85 | 0.35 | 0.10 | 0.45 <sup>(g)</sup> | (0.37) |  | (0.37) | $9.93 | 4.65% | $34924 | 0.54% | 1.44% | 3.75% | 2.85% | 48% |
| 7/17/17<sup>(f)</sup> to 6/30/18 | $10.00 | 0.27 | (0.17) | 0.10 | (0.25) |  | (0.25) | $9.85 | 1.03% | $12436 | 0.54% | 2.70% | 3.08% | 0.92% | 39% |
| **Penn Capital Opportunistic High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Opportunistic High Income Fund** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class |  |  |  |  |  |  |  |  |  |  |  |  |
| 9/1/21 to 8/31/22<sup>(e)</sup> | $9.96 | 0.46 | (1.46) | (1.00) | (0.46) |  | (0.46) | $8.50 | (10.31)% | $18002 | 0.72% | 1.42% | 4.94% | 4.24% | 71% |
| 7/1/21 to 8/31/21<sup>(e)</sup> | $10.00 | 0.08 | (0.04) | 0.04 | (0.08) |  | (0.08) | $9.96 | 0.43% | $18959 | 0.72% | 1.65% | 4.69% | 3.76% | 18% |
| 7/1/20 to 6/30/21 | $8.88 | 0.54 | 1.12 | 1.66 | (0.54) |  | (0.54) | $10.00 | 19.08% | $20099 | 0.72% | 2.08% | 5.27% | 4.21% | 156% |
| 7/1/19 to 6/30/20 | $9.99 | 0.53 | (1.10) | (0.57)<sup>(g)</sup> | (0.54) |  | (0.54) | $8.88 | (5.86)% | $17819 | 0.72% | 2.08% | 5.66% | 4.30% | 149% |
| 7/1/18 to 6/30/19 | $10.06 | 0.59 | (0.02) | 0.57 <sup>(g)</sup> | (0.61) | (0.03) | (0.64) | $9.99 | 5.83% | $15.236 | 0.72% | 2.26% | 5.90% | 4.36% | 85% |
| 7/1/17 to 6/30/18 | $10.52 | 0.61 | (0.22) | 0.39 <sup>(g)</sup> | (0.63) | (0.22) | (0.85) | $10.06 | 3.81% | $13814 | 0.72% | 2.80% | 5.89% | 3.81% | 66% |
| **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** | **Penn Capital Special Situations Small Cap Equity Fund** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class |  |  |  |  |  |  |  |  |  |  |  |  |
| 9/1/21 to 8/31/22<sup>(e)</sup> | $19.62 | (0.05) | (2.12) | (2.17) |  | (3.81) | (3.81) | $13.64 | (14.39)% | $16616 | 1.09% | 1.58% | (0.34)% | (0.83)% | 87% |
| 7/1/21 to 8/31/21<sup>(e)</sup> | $19.79 | (0.01) | (0.16) | (0.17) |  |  |  | $19.62 | (0.86)% | $16894 | 1.09% | 1.71% | (0.46)% | (1.08)% | 11% |
| 7/1/20 to 6/30/21 | $9.33 | (0.01) | 10.47 | 10.46 |  |  |  | $19.79 | 112.11% | $16923 | 1.09% | 2.97% | (0.02)% | (1.90)% | 132% |
| 7/1/19 to 6/30/20 | $10.67 | (0.03) | (1.31) | (1.34) |  |  |  | $9.33 | (12.56)% | $7245 | 1.09% | 3.09% | (0.42)% | (2.42)% | 115% |
| 7/1/18 to 6/30/19 | $12.59 | (0.05) | (0.98) | (1.03)<sup>(g)</sup> |  | (0.89) | (0.89) | $10.67 | (7.91)% | $10198 | 1.09% | 2.38% | (0.35)% | (1.64)% | 97% |
| 7/1/17 to 6/30/18 | $11.71 | (0.08) | 2.36 | 2.28 <sup>(g)</sup> |  | (1.40) | (1.40) | $12.59 | 20.31% | $21289 | 1.09% | 2.09% | (0.64)% | (1.64)% | 105% |
| **Penn Capital Mid Cap Core Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Mid Cap Core Fund** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class | &nbsp;&nbsp;&nbsp;Institutional Class |  |  |  |  |  |  |  |  |  |  |  |  |
| 9/1/21 to 8/31/22<sup>(e)</sup> | $16.79 | 0.02 | (2.62) | (2.60) | (0.05) | (1.72) | (1.77) | $12.42 | -17.45% | $12677 | 1.06% | 1.49% | 0.14% | (0.29)% | 38% |
| 7/1/21 to 8/31/21<sup>(e)</sup> | $16.76 | (0.01) | 0.04 | 0.03 |  |  |  | $16.79 | 0.18% | $18860 | 1.06% | 1.70% | (0.28)% | (0.92)% | 3% |
| 7/1/20 to 6/30/21 | $11.49 | 0.03 | 5.24 | 5.27 | (0.00)<sup>(i)</sup> |  | (0.00)<sup>(i)</sup> | $16.76 | 45.88% | $19972 | 1.06% | 2.19% | 0.30% | (0.83)% | 59% |
| 7/1/19 to 6/30/20 | $12.68 | 0.00 <sup>(i)</sup> | (0.60) | (0.60) |  | (0.59) | (0.59) | $11.49 | (5.23)% | $15966 | 1.06% | 2.14% | (0.04)% | (1.12)% | 57% |
| 7/1/18 to 6/30/19 | $13.55 | (0.01) | 0.37 | 0.36 <sup>(g)</sup> |  | (1.23) | (1.23) | $12.68 | 3.64% | $14363 | 1.06% | 2.20% | (0.11)% | (1.25)% | 40% |
| 7/1/17 to 6/30/18 | $11.73 | (0.04) | 2.07 | 2.03 |  | (0.21) | (0.21) | $13.55 | 17.41% | $14910 | 1.06% | 2.38% | (0.34)% | (1.66)% | 64% |

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<sup>(a)</sup> Information presented related to a share outstanding for the entire period.

<sup>(b)</sup> Annualized for periods less than one full year.

<sup>(c)</sup> Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

<sup>(d)</sup> Not annualized.

<sup>(e)</sup> The Funds changed their fiscal year end to August 31.

<sup>(f)</sup> Commencement of operations.

<sup>(g)</sup> Total from investment operations per share includes redemption fees of less than $0.01 per share.

<sup>(h)</sup> Expense waiver of 0.64% was implemented on August 1, 2017.

<sup>(i)</sup> Amount is less than $0.005 per share.

[This page intentionally left blank]

**THE RBB FUND TRUST**

**PRIVACY POLICY**

---

| | | | |
|:---|:---|:---|:---|
| **FACTS** | **WHAT DOES THE RBB FUND TRUST DO WITH YOUR PERSONAL INFORMATION?** | **WHAT DOES THE RBB FUND TRUST DO WITH YOUR PERSONAL INFORMATION?** | **WHAT DOES THE RBB FUND TRUST DO WITH YOUR PERSONAL INFORMATION?** |
| **Why?** | Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do. | Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do. | Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do. |
| **What?** | The types of personal information we collect and share depend on the product or service you have with us. <br> The information can include: <br> ● Social Security number <br> ● Account balances and account transactions <br> ● Assets and transaction history <br> When you are no longer our client, we continue to share your information as described in this notice.  | The types of personal information we collect and share depend on the product or service you have with us. <br> The information can include: <br> ● Social Security number <br> ● Account balances and account transactions <br> ● Assets and transaction history <br> When you are no longer our client, we continue to share your information as described in this notice.  | The types of personal information we collect and share depend on the product or service you have with us. <br> The information can include: <br> ● Social Security number <br> ● Account balances and account transactions <br> ● Assets and transaction history <br> When you are no longer our client, we continue to share your information as described in this notice.  |
| **How?** | All financial companies need to share clients' personal information to run the everyday business. In the section below, we list the reasons financial companies can share their clients' personal information; the reasons PENN chooses to share; and whether you can limit this sharing. | All financial companies need to share clients' personal information to run the everyday business. In the section below, we list the reasons financial companies can share their clients' personal information; the reasons PENN chooses to share; and whether you can limit this sharing. | All financial companies need to share clients' personal information to run the everyday business. In the section below, we list the reasons financial companies can share their clients' personal information; the reasons PENN chooses to share; and whether you can limit this sharing. |
| **Reasons we can share your personal information** | **Reasons we can share your personal information** | **Does Penn share?** | **Can you limit** <br> **this sharing?**  |
| **For everyday business purposes -** <br> such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus  | **For everyday business purposes -** <br> such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus  | Yes | No |
| **For marketing purposes -** <br> to offer our products and services to you  | **For marketing purposes -** <br> to offer our products and services to you  | No | No |
| **For joint marketing with other financial companies** | **For joint marketing with other financial companies** | No | No |
| **For affiliates' everyday business purposes -** <br> information about transaction(s) and experiences  | **For affiliates' everyday business purposes -** <br> information about transaction(s) and experiences  | Yes | No |
| **For affiliates' everyday business purposes -** <br> information about your creditworthiness  | **For affiliates' everyday business purposes -** <br> information about your creditworthiness  | No | No |
| **For nonaffiliates to market to you** | **For nonaffiliates to market to you** | No | No |
|  |  | No | No |
| **Questions?** | Call 215-302-1500 or go to www.penncapital.com | Call 215-302-1500 or go to www.penncapital.com | Call 215-302-1500 or go to www.penncapital.com |

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| | |
|:---|:---|
| **What we do** | **What we do** |
| Who is providing this notice? | **Penn Capital Management Company, LLC and its affiliates ("Penn")** |
| **What we do** |  |
| How does Penn protect my personal information?<br>| To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer and secured files and buildings. |
| How does Penn collect my personal information?  | We collect your personal information, for example, when you <br> ● **Open an account or deposit money** <br> **● Provide information on client questionnaires**  |
| Why can't I limit all sharing? | Federal law gives you the right to limit only <br> ● sharing for affiliates everyday business purposes - information about your creditworthiness <br> ● affiliates from using your information to market to you <br> ● sharing for non-affiliates to market to you <br> State laws and individual companies may give you additional rights to limit sharing.  |
| **Definitions** | **Definitions** |
| Affiliates | Companies related by common ownership or control. They can be financial or nonfinancial companies <br> ● *Penn Capital Management Company, LLC* <br> ● *Spouting Rock Asset Management, LLC* <br> ● *Spouting Rock Alternate Credit, LLC*  |
| Non-affiliates | Companies not related by common ownership or control. They can be financial or nonfinancial companies <br> ● ***Penn does not share information with non-affiliates***  |
| Joint marketing | A formal agreement between non affiliated companies that together market financial products or services to you. <br> ● ***Penn does not have joint marketing partners***  |
| **Other important information** | **Other important information** |
| This notice replaces all previous notices of our consumer privacy policy, and may be amended from time to time. Penn will inform you of updates or changes as required by law.  | This notice replaces all previous notices of our consumer privacy policy, and may be amended from time to time. Penn will inform you of updates or changes as required by law.  |

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**FOR MORE INFORMATION**

**Annual/Semi-Annual Reports**

Additional information about each Fund's investments is available in the Funds' annual and semi-annual reports to shareholders. The Funds' <u>annual report</u> discusses the market conditions and investment strategies that significantly affected each Fund's performance during its last fiscal year.

**Statement of Additional Information ("SAI")**

The SAI provides more detailed information about the Funds and is incorporated by reference into, and is legally part of, this Prospectus.

**Contacting the Fund**

You can receive free copies of the Prospectus, SAI and annual/semi-annual reports or other information by visiting the Funds' website at www.penncapitalfunds.com or by contacting the Funds at:

**PENN Capital Funds** 

c/o U.S. Bank Global Fund Services

P.O. Box 701

Milwaukee, WI 53201-0701

1-844-302-PENN (7366) (toll free)

**SEC Information**

Reports and other information about the Funds are available on the EDGAR Database on the SEC's Internet site at www.sec.gov. Copies of this information may be obtained, after paying a duplicating fee, by electronic request to publicinfo@sec.gov.

**Distributor**

Foreside Fund Services, LLC

Three Canal Plaza, Suite 100

Portland, ME 04101

www.foreside.com

Investment Company Act File No. 811-23011© Penn Capital Management Company, LLC 2022

![img](fp0081157-1_01.jpg)

**THE RBB FUND TRUST**

STATEMENT OF ADDITIONAL INFORMATION

December 31, 2022

Penn Capital Floating Rate Income Fund

Institutional Class (Ticker: PFRNX)

Penn Capital Short Duration High Income Fund

Institutional Class (Ticker: PSHNX)

Penn Capital Opportunistic High Income Fund

Institutional Class (Ticker: PHYNX)

Penn Capital Mid Cap Core Fund

Institutional Class (Ticker: PSMPX)

Penn Capital Special Situations Small Cap Equity Fund

Institutional Class (Ticker: PSCNX)

This Statement of Additional Information (the "SAI") provides additional information to the Prospectus dated December 31, 2022, as may be amended from time to time, offering shares of the investment companies named above (collectively, the "Funds"), each a series of The RBB Fund Trust, a registered, open-end management investment company (the "Trust"). This SAI is not a prospectus and should only be read in conjunction with the Prospectus. You may obtain the Prospectus without charge by contacting U.S. Bank Global Fund Services at the address or telephone number listed below or by visiting the Funds' website at www.penncapitalfunds.com.

The audited financial statements and Report of Independent Registered Public Accounting Firm in the <u>[Annual Report](http://www.sec.gov/Archives/edgar/data/1618627/000139834422021451/fp0078775-2_ncsr.htm)</u> to shareholders, for the fiscal year ended August 31, 2022, for the Penn Capital Floating Rate Income Fund, the Penn Capital Short Duration High Income Fund, the Penn Capital Opportunistic High Income Fund, the Penn Capital Mid Cap Core Fund, and the Penn Capital Special Situations Small Cap Equity Fund are incorporated by reference into, and are legally part of, this SAI. Copies of the Annual Report to Shareholders for these Funds may be obtained, without charge, upon request by contacting U.S. Bank Global Fund Services at the address or telephone number listed below:

**The RBB Fund Trust**

**c/o U.S. Bank Global Fund Services**

**P.O. Box 701**

**Milwaukee, WI 53201-0701**

**Phone: 1-844-302-PENN (7366)**

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
| [**GENERAL INFORMATION ABOUT THE FUNDS**](#rbb-penn_001) | [**1**](#rbb-penn_001) |
| [**DESCRIPTION OF THE FUNDS**](#rbb-penn_002) | [**1**](#rbb-penn_002) |
| [**DIVERSIFICATION OF THE FUNDS**](#rbb-penn_003) | [**1**](#rbb-penn_003) |
| [**INVESTMENT RESTRICTIONS**](#rbb-penn_004) | [**2**](#rbb-penn_004) |
| [**INVESTMENT POLICIES AND ASSOCIATED RISKS**](#rbb-penn_005) | [**3**](#rbb-penn_005) |
| [**DISCLOSURE OF PORTFOLIO HOLDINGS**](#rbb-penn_006) | [**35**](#rbb-penn_006) |
| [**MANAGEMENT OF THE FUNDS**](#rbb-penn_007) | [**36**](#rbb-penn_007) |
| [**SERVICE PROVIDERS**](#rbb-penn_008) | [**52**](#rbb-penn_008) |
| [**CODES OF ETHICS**](#rbb-penn_009) | [**53**](#rbb-penn_009) |
| [**PROXY VOTING GUIDELINES**](#rbb-penn_010) | [**53**](#rbb-penn_010) |
| [**VALUATION OF SHARES**](#rbb-penn_011) | [**54**](#rbb-penn_011) |
| [**PURCHASE AND REDEMPTION OF SHARES**](#rbb-penn_012) | [**54**](#rbb-penn_012) |
| [**PORTFOLIO TRANSACTIONS**](#rbb-penn_013) | [**56**](#rbb-penn_013) |
| [**TAXES**](#rbb-penn_014) | [**58**](#rbb-penn_014) |
| [**INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**](#rbb-penn_015) | [**59**](#rbb-penn_015) |
| [**LEGAL COUNSEL**](#rbb-penn_016) | [**59**](#rbb-penn_016) |
| [**FINANCIAL STATEMENTS**](#rbb-penn_017) | [**59**](#rbb-penn_017) |
| [**APPENDIX A**](#rbb-penn_018) | [**A- 1**](#rbb-penn_018) |
| [**APPENDIX B**](#rbb-penn_019) | [**B- 1**](#rbb-penn_019) |

---

i

**General Information about the Funds**

The RBB Fund Trust (formerly known as PENN Capital Funds Trust) (the "Trust") is an open-end management investment company organized as a Delaware statutory trust on August 29, 2014. The Declaration of Trust permits the Trust to offer separate series of shares of beneficial interest (each of which is a separate mutual fund) and separate classes of such series. Upon liquidation Fund shareholders are entitled to share pro rata in the net assets of such Fund available for distribution to shareholders. Expenses attributable to any Fund are borne by that Fund.

The Trust is authorized to issue an unlimited number of interests (or shares) with no par value. Shares of each series have equal voting rights, and are voted in the aggregate and not by the series except in matters where a separate vote is required by the Investment Company Act of 1940, as amended (the "1940 Act"), or when the matter affects only the interest of a particular Fund. The Funds may hold special meetings of shareholders to elect or remove Trustees (as defined below), change fundamental policies, approve a management contract, or for other purposes. The Funds will mail proxy materials in advance of a shareholder meeting, including a proxy and information about the proposals to be voted on. When matters are submitted to shareholders for a vote, each shareholder is entitled to one vote for each full share owned and fractional votes for fractional shares owned. Fund shares do not have cumulative voting rights or any preemptive or conversion rights. The Trust does not normally hold annual meetings of shareholders.

This SAI pertains to the shares representing interests in the Penn Capital Floating Rate Income Fund, the Penn Capital Short Duration High Income Fund, the Penn Capital Opportunistic High Income Fund, the Penn Capital Mid Cap Core Fund, and the Penn Capital Special Situations Small Cap Equity Fund (each, a "Fund" and, collectively, the "Funds"). Each Fund offers one class of shares: Institutional Class.

**Description of the Funds**

Each Fund has its own investment objectives and policies. Each Fund's investment objective is non-fundamental, and may be changed by the Trust's Board of Trustees (the "Board" or "Trustees") without shareholder approval. Unless otherwise noted, all of the other investment policies and strategies described in the Prospectus or hereafter are non-fundamental. Penn Capital Management Company, LLC, serves as the investment advisor to the Funds (the "Advisor"). The following Funds have changed their name within the past five years:

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| | | |
|:---|:---|:---|
| **Current Fund Name** | **Former Fund Name** | **Date of Change** |
| Penn Capital Floating Rate Income | Penn Capital Defensive Floating Rate Income Fund | June 29, 2021 |
|  | Penn Capital Senior Floating Rate Income Fund | October 31, 2017 |
| Penn Capital Short Duration High Income Fund | Penn Capital Defensive Short Duration High Income Fund | June 29, 2021 |
| Penn Capital Opportunistic High Income Fund | Penn Capital Multi-Credit High Income Fund | October 31, 2020 |
|  | Penn Capital Opportunistic High Yield Fund | October 31, 2017 |
|  | Penn Capital High Yield Fund | March 17, 2016 |
| Penn Capital Mid Cap Core Fund | Penn Capital Managed Alpha SMID Cap Equity Fund | June 29, 2021 |
|  | Penn Capital Small/Mid Cap Equity Fund | October 31, 2017 |

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**Diversification of the Funds**

All of the Funds are classified and operate as diversified funds under the 1940 Act. Under the 1940 Act, a diversified fund is a fund that meets the following requirements: at least 75% of the value of its total assets is represented by cash and cash items (including receivables), government securities, securities of other investment companies, and other securities that are, for the purposes of this calculation, limited in respect of any one issuer to an amount not greater in value than 5% of the value of the total assets of such management company and to not more than 10% of the outstanding voting securities of such issuer. A Fund may not change its diversification classification to become non-diversified without the approval of the holders of a majority of the Fund's outstanding voting securities. As used in this SAI, "a majority of a Fund's outstanding voting securities" means the lesser of (1) 67% of the shares of beneficial interest of the Fund represented at a meeting at which more than 50% of the outstanding shares are present, or (2) more than 50% of the outstanding shares of beneficial interest of the Fund.

**Investment Restrictions**

Each Fund has adopted and is subject to the following fundamental investment restrictions. These investment restrictions may be changed only with the approval of the holders of a majority of a Fund's outstanding voting securities.

The percentage limitations referred to in these restrictions generally apply only at the time of investment. A later increase or decrease in a percentage that results from a change in value in the portfolio securities held by a Fund will not be considered a violation of such limitation, with the exception of the Fund's limitations on borrowing as described below, and a Fund will not necessarily have to sell a portfolio security or adjust its holdings in order to comply.

Each Fund may not:

1. borrow
 money or issue senior securities, except as the 1940 Act, any rules or orders thereunder,
 or U.S. Securities and Exchange Commission ("SEC") staff interpretation thereof,
 may permit;

2. underwrite
 the securities of other issuers, except that it may engage in transactions involving
 the acquisition, disposition or resale of its portfolio securities under circumstances
 where it may be considered to be an underwriter under the Securities Act of 1933, as
 amended (the "1933 Act");

3. purchase
 or sell real estate, unless acquired as a result of ownership of securities or other
 instruments and provided that this restriction does not prevent the Fund from (i) purchasing
 or selling securities or instruments secured by real estate or interests therein, securities
 or instruments representing interests in real estate or securities or instruments of
 issuers that invest, deal or otherwise engage in transactions in real estate or interests
 therein, and (ii) making, purchasing or selling real estate mortgage loans;

4. make
 loans, provided that this restriction does not prevent the Fund from purchasing debt
 obligations, entering into repurchase agreements, loaning its assets to broker/dealers
 or institutional investors and investing in loans, including assignments and participation
 interests;

5. purchase
 or sell physical commodities, unless acquired as a result of ownership of securities
 or other instruments, and provided that this limitation does not prevent the Fund from
 (i) purchasing or selling securities of companies that purchase or sell commodities or
 that invest in commodities; (ii) engaging in any transaction involving currencies, options,
 forwards, futures contracts, options on futures contracts, swaps, hybrid instruments
 or other derivatives; or (iii) investing in securities, or transacting in other instruments,
 that are linked to or secured by physical or other commodities;

6. with
 respect to the Penn Capital Floating Rate Income Fund, Penn Capital Opportunistic High
 Income Fund, Penn Capital Mid Cap Core Fund and Penn Capital Special Situations Small
 Cap Equity Fund, make investments that will result in the concentration (as that term
 may be defined in the 1940 Act, any rules or orders thereunder, or SEC staff interpretation
 thereof) of its total assets in securities of issuers in any one industry (other than
 securities issued or guaranteed by the U.S. government or any of its agencies or instrumentalities
 or securities of other investment companies, whether registered or excluded from registration
 under Section 3(c) of the 1940 Act); and

7. with
 respect to the Penn Capital Short Duration High Income Fund, make investments that
 will result in concentration (as that term may be defined in the 1940 Act, any rules
 or orders thereunder, or SEC staff interpretation thereof) in securities of issuers in
 any one industry (other than securities issued or guaranteed by the U.S. government or
 any of its agencies or instrumentalities or securities of other investment companies,
 whether registered or excluded from registration under Section 3(c) of the 1940 Act).

With respect to #1 above, for more information about the restrictions of the 1940 Act on the Funds with respect to borrowing and senior securities, see the section "Borrowings" below. With respect to #7 above: (1) in accordance with SEC guidance, concentration means investing more than 25% of the Fund's total assets. With respect to #6 and #7 above, (1) a Fund will not consider investment companies to be an industry, (2) a Fund will look through to the security holdings of any investment company in which it invests, and (3) more information about the Funds' industry concentration restrictions as they relate to mortgage-backed securities is found in the section "Mortgage-Backed Securities" below.

**Investment Policies and Associated Risks**

The Funds may invest in a variety of securities and employ a number of investment techniques, which involve risks. This SAI contains additional information regarding both the principal and non-principal investment strategies of the Funds. Unless otherwise noted in the Prospectus or this SAI or subject to a limitation under the 1940 Act and its related regulations, the investments listed below are not subject to a specific percentage limitation so long as they are made in a manner consistent with a Fund's principal investment strategies.

The following tables set forth the types of additional investment strategies that each Fund may employ. The descriptions following the table provide more detailed information about each type of investment strategy and associated risks.

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| | | | |
|:---|:---|:---|:---|
| | **Penn Capital** <br> **Floating Rate<br> Income** <br> **Fund**  | **Penn Capital<br> Short Duration<br> High Income<br> Fund** | **Penn Capital<br> Opportunistic<br> High Income<br> Fund** |
| Asset-Backed Securities | X | X | X |
| Bank Loans, Loan Participations and Assignments | X | X | X |
| Borrowings | X | X | X |
| Collateralized Mortgage Obligations ("CMOs") and Real Estate Mortgage Investment Conduits ("REMICs") | X | X | X |
| Common and Preferred Stock | X |  | X |
| Cyber Security Risk | X | X | X |
| Debt/Fixed Income Securities | X | X | X |
| Emerging Market Countries | X | X | X |
| Exchange Traded Funds ("ETFs") | X | X | X |
| Exchange Traded Notes ("ETNs") | X | X | X |
| Foreign Currency Transactions | X | X | X |
| Foreign Securities | X | X | X |
| Futures Contracts | X | X | X |
| Index Warrants | X |  | X |
| Inflation-Linked and Inflation-Indexed Securities | X | X | X |
| Initial Public Offerings (IPOs) |  |  |  |
| Investments in Banks | X | X | X |
| Investment Companies | X | X | X |
| LIBOR Transition Risk | X | X | X |
| Loan Based Derivatives | X | X | X |
| Mortgage-Backed Securities | X | X | X |
| Natural Disaster/Epidemic Risk, COVID-19 | X | X | X |
| Options | X | X | X |
| Options on Foreign Currencies | X | X | X |
| Options on Indices | X | X | X |
| Over-The-Counter ("OTC") Options | X | X | X |
| Private Placements | X | X | X |
| REITs | X | X | X |
| Repurchase and Reverse Repurchase Agreements | X | X | X |
| Restricted and Illiquid Securities | X | X | X |
| Step-Coupon Securities | X | X | X |

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| | | | |
|:---|:---|:---|:---|
| | **Penn Capital** <br> **Floating Rate<br> Income** <br> **Fund**  | **Penn Capital<br> Short Duration<br> High Income<br> Fund** | **Penn Capital<br> Opportunistic<br> High Income<br> Fund** |
| Structured Notes | X | X | X |
| Supranational Entities | X |  | X |
| Swaps—Interest Rate Swaps, Mortgage Swaps, Credit Swaps, Currency Swaps, Total Return Swaps, Options on Swaps and Interest Rate Caps, Floors and Collars, Inflation Indexed Swaps  | X | X | X |
| Synthetic Securities | X |  | X |
| Temporary Investments | X | X | X |
| Trust Preferred Securities | X | X | X |
| U.S. Government Obligations | X | X | X |
| Variable and Floating Rate Instruments | X | X | X |
| Warrants |  | X | X |
| When-Issued Purchases, Delayed Delivery and Forward Commitments | X | X | X |
| Zero-Coupon, Delayed Interest and Capital Appreciation Securities |  | X | X |

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| | | |
|:---|:---|:---|
| | **Penn Capital Mid Cap Core Fund Fund** | **Penn Capital Special Situations Small Cap Equity Fund** |
| Asset-Backed Securities |  |  |
| Bank Loans, Loan Participations and Assignments |  |  |
| Borrowings | X | X |
| Collateralized Mortgage Obligations ("CMOs") and Real Estate Mortgage Investment Conduits ("REMICs")  |  |  |
| Common and Preferred Stock | X | X |
| Cyber Security Risk | X | X |
| Debt/Fixed Income Securities |  |  |
| Emerging Market Countries | X | X |
| Exchange Traded Funds ("ETFs") | X | X |
| Exchange Traded Notes ("ETNs") |  |  |
| Foreign Currency Transactions | X | X |
| Foreign Securities | X | X |
| Futures Contracts | X | X |
| Index Warrants | X | X |
| Inflation-Linked and Inflation-Indexed Securities | X | X |
| Initial Public Offerings (IPOs) | X | X |
| Investments in Banks | X | X |
| Investment Companies | X | X |
| Loan Based Derivatives |  |  |
| Mortgage-Backed Securities |  |  |
| Natural Disaster/Epidemic Risk, COVID-19 | X | X |
| Options | X | X |
| Options on Foreign Currencies |  |  |

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| | | |
|:---|:---|:---|
| | **Penn Capital Mid Cap Core Fund Fund** | **Penn Capital Special Situations Small Cap Equity Fund** |
| Options on Indices | X | X |
| Over-The-Counter ("OTC") Options | X | X |
| Private Placements | X | X |
| REITs | X | X |
| Repurchase and Reverse Repurchase Agreements | X | X |
| Restricted and Illiquid Securities | X | X |
| Step-Coupon Securities |  |  |
| Structured Notes |  |  |
| Supranational Entities | X | X |
| Swaps—Interest Rate Swaps, Mortgage Swaps, Credit Swaps, Currency Swaps, Total Return Swaps, Options on Swaps and Interest Rate Caps, Floors and Collars, Inflation Indexed Swaps  | X | X |
| Synthetic Securities | X | X |
| Temporary Investments | X | X |
| Trust Preferred Securities |  |  |
| U.S. Government Obligations | X | X |
| Variable and Floating Rate Instruments |  |  |
| Warrants | X | X |
| When-Issued Purchases, Delayed Delivery and Forward Commitments | X | X |
| Zero-Coupon, Delayed Interest and Capital Appreciation Securities |  |  |

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**Exclusion of Advisor from Commodity Pool Operator Definition**

With respect to each Fund, the Advisor has claimed an exclusion from the definition of "commodity pool operator" ("CPO") under the Commodity Exchange Act ("CEA") and the rules of the Commodity Futures Trading Commission ("CFTC") and, therefore, is not subject to CFTC registration or regulation as a CPO. In addition, the Advisor is relying upon a related exclusion from the definition of "commodity trading advisor" ("CTA") under the CEA and the rules of the CFTC.

The terms of the CPO exclusion require each Fund, among other things, to adhere to certain limits on its investments in "commodity interests," which include commodity futures, commodity options and swaps. Because the Advisor and the Funds intend to comply with the terms of the CPO exclusion, a Fund may, in the future, need to adjust its investment strategies, consistent with its investment objective, to limit its investments in these types of instruments. The Funds are not intended as vehicles for trading in the commodity futures, commodity options or swaps markets. The CFTC has neither reviewed nor approved the Advisor's reliance on these exclusions, or the Funds, their investment strategies, the Prospectus or this SAI.

Generally, the exclusion from CPO regulation on which the Advisor relies requires each Fund to meet one of the following tests for its commodity interest positions, other than positions entered into for bona fide hedging purposes (as defined in the rules of the CFTC): either (1) the aggregate initial margin and premiums required to establish the Fund's positions in commodity interests may not exceed 5% of the liquidation value of the Fund's portfolio (after taking into account unrealized profits and unrealized losses on any such positions); or (2) the aggregate net notional value of the Fund's commodity interest positions, determined at the time the most recent such position was established, may not exceed 100% of the liquidation value of the Fund's portfolio (after taking into account unrealized profits and unrealized losses on any such positions). In addition to meeting one of these trading limitations, the Funds may not be marketed as commodity pools or otherwise as vehicles for trading in the commodity futures, commodity options or swaps markets. If, in the future, a Fund can no longer satisfy these requirements, the Advisor would withdraw its notice claiming an exclusion from the definition of a CPO with respect to that Fund, and the Advisor would be subject to registration and regulation as a CPO with respect to the Fund, in accordance with CFTC rules that apply to CPOs of registered investment companies. Generally, these rules allow for substituted compliance with CFTC disclosure and shareholder reporting requirements, based on the Advisor's compliance with comparable SEC requirements. However, as a result of CFTC regulation with respect to the Fund, the Fund may incur additional compliance and other expenses.

**Policy Regarding Fund Names**

Each Fund (except the Penn Capital Short Duration High Income Fund) has adopted a policy of investing at least 80% of its net assets in the type of securities suggested by the Fund's name. The term "net assets" means the Fund's net assets, including any borrowings for investment purposes, consistent with SEC requirements. Investments, such as derivative instruments, that provide exposure to the type of securities suggested by the Fund's name may be used to satisfy the Fund's 80% investment policy. Investments in another investment company, including an ETF, will be considered to "provide exposure to" the type of securities suggested by the Fund's name for purposes of this policy if the investment company has a policy of investing at least 80% of its assets in the type of securities suggested by the Fund's name, or investments that provide exposure to the type of securities suggested by the Fund's name.

**Asset-Backed Securities**

The Funds may purchase debt obligations known as "asset-backed securities." Asset-backed securities are securities that represent a participation in, or are secured by and payable from, a stream of payments generated by particular assets, most often a pool or pools of similar assets (*e.g.*, receivables on home equity and credit loans and receivables regarding automobile, credit card, mobile home and recreational vehicle loans, wholesale dealer floor plans and leases).

Such receivables are securitized in either a pass-through or a pay-through structure. Pass-through securities provide investors with an income stream consisting of both principal and interest payments based on the receivables in the underlying pool. Pay-through asset-backed securities are debt obligations issued usually by a special purpose entity, which are collateralized by the various receivables and in which the payments on the underlying receivables provide that the Funds pay the debt service on the debt obligations issued. The Funds may invest in these and other types of asset-backed securities that may be developed in the future.

The credit quality of most asset-backed securities depends primarily on the credit quality of the assets underlying such securities, how well the entity issuing the security is insulated from the credit risk of the originator or any other affiliated entities, and the amount and quality of any credit support provided to the securities. The rate of principal payment on asset-backed securities generally depends on the rate of principal payments received on the underlying assets which in turn may be affected by a variety of economic and other factors. As a result, the yield on any asset-backed security is difficult to predict with precision and actual yield to maturity may be more or less than the anticipated yield to maturity. Asset-backed securities may be classified as "pass-through certificates" or "collateralized obligations."

Asset-backed securities are often backed by a pool of assets representing the obligations of a number of different parties. To lessen the effect of failures by obligors on underlying assets to make payment, such securities may contain elements of credit support. Such credit support falls into two categories: (i) liquidity protection; and (ii) protection against losses resulting from ultimate default by an obligor on the underlying assets. Liquidity protection refers to the provision of advances, generally by the entity administering the pool of assets, to ensure that the receipt of payments due on the underlying pool is timely. Protection against losses resulting from ultimate default enhances the likelihood of payments of the obligations on at least some of the assets in the pool. Such protection may be provided through guarantees, insurance policies or letters of credit obtained by the issuer or sponsor from third parties, through various means of structuring the transaction or through a combination of such approaches.

Due to the shorter maturity of the collateral backing such securities, there is less of a risk of substantial prepayment than with mortgage-backed securities. Asset-backed securities do, however, involve certain risks not associated with mortgage-backed securities, including the risk that security interests cannot be adequately, or in many cases, ever, established. In addition, with respect to credit card receivables, a number of state and federal consumer credit laws give debtors the right to set off certain amounts owed on the credit cards, thereby reducing the outstanding balance. In the case of automobile receivables, there is a risk that the holders may not have either a proper or first security interest in all of the obligations backing such receivables due to the large number of vehicles involved in a typical issuance and technical requirements under state laws. Therefore, recoveries on repossessed collateral may not always be available to support payments on the securities.

Examples of credit support arising out of the structure of the transaction include "senior-subordinated securities" (multiple class securities with one or more classes subordinate to other classes as to the payment of principal thereof and interest thereon, with the result that defaults on the underlying assets are borne first by the holders of the subordinated class), creation of "reserve funds" (where cash or investments, sometimes funded from a portion of the payments on the underlying assets, are held in reserve against future losses) and "over collateralization" (where the scheduled payments on, or the principal amount of, the underlying assets exceeds that required to make payments of the securities and pay any servicing or other fees). The degree of credit support provided for each issue is generally based on historical credit information respecting the level of credit risk associated with the underlying assets. Delinquencies or losses in excess of those anticipated could adversely affect the return on an investment in such issue.

The Funds may also gain exposure to asset-backed securities through entering into credit default swaps or other derivative instruments related to asset-backed securities. For example, a Fund may enter into credit default swaps and can either gain synthetic risk exposure to a portfolio of such securities by "selling protection" or take a short position by "buying protection." The protection buyer pays a monthly premium to the protection seller, and the seller agrees to cover any principal losses and interest shortfalls of the referenced underlying asset-backed securities. Credit default swaps and other derivative instruments related to asset-backed securities are subject to the risks associated with asset-backed securities generally, as well as the risks of derivative transactions. See the section "Swaps--Interest Rate Swaps, Mortgage Swaps, Credit Swaps, Currency Swaps, Total Return Swaps, Options on Swaps and Interest Rate Caps, Floors and Collars, Inflation Indexed Swaps" below.

**Bank Loans, Loan Participations and Assignments**

The Funds may invest in bank loans, which include both secured and unsecured loans made by banks and other financial institutions to corporate customers. Senior loans typically hold the most senior position in a borrower's capital structure, may be secured by the borrower's assets and have interest rates that reset frequently. The proceeds of senior loans primarily are used to finance leveraged buyouts, recapitalizations, mergers, acquisitions, stock repurchases, dividends, and, to a lesser extent, to finance internal growth and for other corporate purposes. These loans may not be rated investment grade by the rating agencies. Although secured loans are secured by collateral of the borrower, there is no assurance that the liquidation of collateral from a secured loan would satisfy the borrower's obligation, or that the collateral can be liquidated. Economic downturns generally lead to higher non-payment and default rates and a senior loan could lose a substantial portion of its value prior to a default. Some senior loans are subject to the risk that a court could subordinate such senior loans to presently existing or future indebtedness of the borrower or take other action detrimental to the holders of senior loans, including, in certain circumstances, invalidating such senior loans or causing interest previously paid to be refunded to the borrower.

A Fund's investments in loans are subject to credit risk. Indebtedness of borrowers whose creditworthiness is poor involves substantial risks, and may be highly speculative. The interest rates on many bank loans reset frequently, and thus bank loans are subject to interest rate risk. Most bank loans are not traded on any national securities exchange. Bank loans generally have less liquidity than investment grade bonds and there may be less public information available about them.

Large loans to corporations or governments may be shared or syndicated among several lenders, usually (but often not limited to) banks. A Fund may participate in the primary syndicate for a loan and may purchase loans from other lenders (sometimes referred to as loan assignments), in either case becoming a direct lender. A Fund also may acquire a participation interest in another lender's portion of the loan. Participation interests involve special types of risk, including liquidity risk and the risks of being a lender. When investing in a loan participation, a Fund typically will have the right to receive payments only from the lender to the extent the lender receives payments from the borrower, and not from the borrower itself. Likewise, a Fund typically will be able to enforce its rights only through the lender, and not directly against the borrower. As a result, a Fund will assume the credit risk of both the borrower and the lender that is selling the participation.

Investments in loans through direct assignment of a financial institution's interests with respect to a loan may involve additional risks to the Funds. For example, if the loan is foreclosed, a Fund could become part owner of any collateral, and would bear the costs and liabilities associated with owning and disposing of the collateral. In addition, it is possible that a Fund could be held liable as a co-lender. Loans and other debt instruments that are not in the form of securities may offer less legal protection to the Fund in certain circumstances.

A loan is often administered by a bank or other financial institution that acts as agent for all holders. The agent administers the terms of the loan, as specified in the loan agreement. Unless a Fund has direct recourse against the borrower, under the terms of the loan or other indebtedness, the Fund may have to rely on the agent to pursue appropriate credit remedies against a borrower.

In addition to investing in senior secured loans, a Fund may invest in other loans, such as second lien loans and other secured loans, as well as unsecured loans. Second lien loans and other secured loans are subject to the same risks associated with investment in senior loans and lower-rated debt securities. However, such loans may rank lower in right of payment than senior secured loans, and are subject to additional risk that the cash flow of the borrower and any property securing the loan may be insufficient to meet scheduled payments after giving effect to the higher ranking secured obligations of the borrower. Second lien loans and other secured loans are expected to have greater price volatility than more senior loans and may be less liquid. There is also a possibility that originators will not be able to sell participations in lower-ranking loans, which would create greater credit risk exposure. Each of these risks may be increased in the case of unsecured loans, which are not backed by a security interest in any specific collateral.

Loan interests may not be considered "securities," and purchasers, such as the Funds, therefore may not be entitled to rely on the anti-fraud protections of the federal securities laws.

***Covenants***

The borrower or issuer under a bank loan generally must comply with various restrictive covenants contained in any bank loan agreement between the borrower and the lending syndicate. A restrictive covenant is a promise by the borrower to take certain actions that protect, or not to take certain actions that may impair, the rights of lenders. These covenants, in addition to requiring the scheduled payment of interest and principal, may include restrictions on dividend payments and other distributions to shareholders, provisions requiring the borrower to maintain specific financial ratios or relationships regarding, and/or limits on, total debt. In addition, a covenant may require the borrower to prepay the bank loan with any excess cash flow. Excess cash flow generally includes net cash flow (after scheduled debt service payments and permitted capital expenditures) as well as the proceeds from asset dispositions or sales of securities. A breach of a covenant (after giving effect to any cure period) in a bank loan agreement which is not waived by the lender and the lending syndicate normally is an event of acceleration. This means that the Agent Bank has the right to demand immediate repayment in full of the outstanding bank loan.

***Covenant lite loans***

Some covenant lite loans may be in the market from time to time which tend to have fewer or no financial maintenance covenants and restrictions. A covenant lite loan typically contains fewer clauses which allow an investor to proactively enforce financial covenants or prevent undesired actions by the borrower/issuer. Covenant lite loans also generally provide fewer investor protections if certain criteria are breached. A Fund may experience losses or delays in enforcing its rights on its holdings of covenant lite loans.

**Borrowings**

A Fund may borrow funds to meet redemptions, for other emergency purposes or to increase its portfolio holdings of securities, to the extent permitted by the 1940 Act. Such borrowings may be on a secured or unsecured basis, and at fixed or variable rates of interest. A Fund may borrow for such purposes an amount up to 33 1/3% of the value of its total assets (including the amount borrowed, but less all liabilities and indebtedness not represented by senior securities) from banks. The 1940 Act requires a Fund to maintain continuous asset coverage of not less than 300% with respect to all borrowings. If such asset coverage should decline to less than 300% due to market fluctuations or other reasons, a Fund may be required to dispose of some of its portfolio holdings within three days in order to reduce the Fund's debt and restore the 300% asset coverage, even though it may be disadvantageous from an investment standpoint to dispose of assets at that time.

In addition to borrowings that are subject to 300% asset coverage and are considered by the SEC to be permitted "senior securities," a Fund is also permitted under the 1940 Act to borrow for temporary purposes in an amount not exceeding 5% of the value of its total assets at the time when the loan is made. A loan will be presumed to be for temporary purposes if it is repaid within 60 days and is not extended or renewed.

Leveraging, by means of borrowing, may exaggerate the effect of any increase or decrease in the value of portfolio securities on a Fund's net asset value per share ("NAV"), and money borrowed will be subject to interest and other costs (which may include commitment fees and/or the cost of maintaining minimum average balances), which may or may not exceed the income received from the investments purchased with borrowed funds.

**Collateralized Mortgage Obligations ("CMOs") and Real Estate Mortgage Investment Conduits ("REMICs")**

The Funds may invest in CMOs and REMICs. A CMO is a debt security on which interest and prepaid principal are paid, in most cases, semi-annually. CMOs may be collateralized by whole mortgage loans but are more typically collateralized by portfolios of mortgage pass-through securities guaranteed by GNMA, the Federal Home Loan Mortgage Company, or the Federal National Mortgage Association ("FNMA" or "Fannie Mae<sup>®</sup>") and their income streams. Privately-issued CMOs tend to be more sensitive to interest rates than government-issued CMOs.

CMOs are structured into multiple classes, each bearing a different stated maturity. Actual maturity and average life will depend upon the prepayment experience of the collateral. CMOs provide for a modified form of call protection through a de facto breakdown of the underlying pool of mortgages according to how quickly the loans are repaid. Monthly payments of principal received from the pool of underlying mortgages, including prepayments, is first returned to investors holding the shortest maturity class. The investors holding the longer maturity classes receive principal only after the first class has been retired. An investor is partially guarded against a sooner than desired return of principal because of the sequential payments.

In a typical CMO transaction, a corporation issues multiple series (*e.g.*, A, B, C, Z) of CMO bonds ("Bonds"). Proceeds of the Bond offering are used to purchase mortgages or mortgage pass-through certificates ("Collateral"). The Collateral is pledged to a third-party trustee as security for the Bonds. Principal and interest payments from the Collateral are used to pay principal on the Bonds in a specified order (*e.g.*, first A, then B, then C, then Z). The A, B and C Bonds all bear current interest. Interest on the Z Bond is accrued and added to principal and a like amount is paid as principal on the A, B, or C Bond currently being paid off. When the A, B and C Bonds are paid in full, interest and principal on the Z Bond begins to be paid currently. With some CMOs, the issuer serves as a conduit to allow loan originators (primarily builders or savings and loan associations) to borrow against their loan portfolios. REMICs are private entities formed for the purpose of holding a fixed pool of mortgages secured by an interest in real property. REMICs are similar to CMOs in that they issue multiple classes of securities.

CMOs and REMICs issued by private entities are not government securities and are not directly guaranteed by any government agency. They are secured by the underlying collateral of the private issuer. Yields on privately issued CMOs, as described above, have been historically higher than yields on CMOs issued or guaranteed by U.S. government agencies. However, the risk of loss due to default on such instruments is higher because they are not guaranteed by the U.S. government. Such instruments also tend to be more sensitive to interest rates than U.S. government-issued CMOs. For federal income tax purposes, a Fund will be required to accrue income on regular interest in CMOs and REMICs using the "catch-up" method, with an aggregate prepayment assumption.

**Common and Preferred Stock**

Equity securities, such as common stocks, represent shares of ownership of a corporation. Preferred stocks are equity securities that often pay dividends at a specific rate and have a preference over common stocks in dividend payments and the liquidation of assets. Some preferred stocks may be convertible into common stock. Convertible securities are securities (such as debt securities or preferred stock) that may be converted into or exchanged for a specified amount of common stock of the same or different issuer within a particular period of time at a specified price or formula.

**Cyber security Risk**

Each Fund and its service providers may be prone to operational and information security risks resulting from breaches in cyber security. A breach in cyber security refers to both intentional and unintentional events that may cause a Fund to lose proprietary information, suffer data corruption, or lose operational capacity. Breaches in cyber security include, among other behaviors, stealing or corrupting data maintained online or digitally, denial of service attacks on websites, the unauthorized release of confidential information or various other forms of cyber-attacks. Cyber security breaches affecting a Fund, the Advisor, custodian, transfer agent, intermediaries and other third-party service providers may adversely impact the Funds. For instance, cyber security breaches may interfere with the processing of shareholder transactions, impact a Fund's ability to calculate its NAVs, cause the release of private shareholder information or confidential business information, impede trading, subject a Fund to regulatory fines or financial losses and/or cause reputational damage. Each Fund may also incur additional costs for cyber security risk management purposes. Similar types of cyber security risks are also present for issuers of securities in which each Fund may invest, which could result in material adverse consequences for such issuers and may cause a Fund's investment in such companies to lose value. While each Fund and its service providers have established IT and data security programs and have in place business continuity plans and other systems designed to prevent losses and mitigate cyber security risk, there are inherent limitations in such plans and systems, including the possibility that certain risks have not been identified or that cyber-attacks may be highly sophisticated. Furthermore, the Funds have limited ability to prevent or mitigate cyber security incidents affecting third-party service providers, and such third-party service providers may have limited indemnification obligations to the Funds and the Advisor.

**Debt/Fixed Income Securities**

The Funds may invest in debt securities, including those convertible into common stocks.

The Funds consider investment grade securities to be those rated BBB- or higher by Standard and Poor's<sup>®</sup> Financial Services LLC, a subsidiary of the McGraw-Hill Companies, Inc. ("S&P<sup>®</sup>"), or Baa3 or higher by Moody's Investors Service<sup>©</sup>, Inc. ("Moody's"), or an equivalent rating by Fitch, Inc.<sup>©</sup> ("Fitch"), or determined to be of comparable quality by the Advisor if the security is unrated. Bonds in the lowest investment grade category (BBB- by S&P<sup>®</sup> or Baa3 by Moody's) have speculative characteristics, and changes in the economy or other circumstances are more likely to lead to a weakened capacity of the bonds to make principal and interest payments than would occur with bonds rated in higher categories.

The Funds may invest in high-yield debt securities or "junk bonds," which are securities rated BB+ or below by S&P<sup>®</sup> or Ba1 or below by Moody's ("lower-rated securities"). Lower-rated securities are considered to be of poor standing and predominantly speculative and are subject to a substantial degree of credit risk. Lower-rated securities may be issued as a consequence of corporate restructurings, such as leveraged buy-outs, mergers, acquisitions, debt recapitalizations or similar events. Also, lower-rated securities are often issued by smaller, less creditworthy companies or by highly leveraged (indebted) firms, which are generally less able than more financially stable firms to make scheduled payments of interest and principal. The risks posed by securities issued under such circumstances are substantial.

The higher yields from lower-rated securities may compensate for the higher default rates on such securities. However, there can be no assurance that higher yields will offset default rates on lower-rated securities in the future. Issuers of these securities are often highly leveraged, so their ability to service their debt obligations during an economic downturn or during sustained periods of rising interest rates may be impaired. In addition, such issuers may not have more traditional methods of financing available to them and may be unable to repay their debt at maturity by refinancing. The risk of loss due to default by the issuer is significantly greater for the holders of lower-rated securities because such securities may be unsecured and may be subordinated to other creditors of the issuer. Further, an economic recession may result in default levels with respect to such securities in excess of historic averages.

The value of lower-rated securities will be influenced not only by changing interest rates, but also by the market's perception of credit quality and the outlook for economic growth. When economic conditions appear to be deteriorating, lower-rated securities may decline in market value due to investors' heightened concern over credit quality, regardless of prevailing interest rates.

Especially during times of deteriorating economic conditions, trading in the secondary market for lower-rated securities may become thin and market liquidity may be significantly reduced. Even under normal conditions, the market for lower-rated securities may be less liquid than the market for investment grade debt securities. There are fewer securities dealers in the high yield market and purchasers of lower-rated securities are concentrated among a smaller group of securities dealers and institutional investors. In periods of reduced market liquidity, lower-rated securities' prices may become more volatile and a Fund's ability to dispose of particular issues when necessary to meet that Fund's liquidity needs or in response to a specific economic event such as a deterioration in the creditworthiness of the issuer may be adversely affected.

The ratings of S&P<sup>®</sup>, Moody's and other nationally recognized statistical rating organizations ("NRSROs") represent the opinions of those rating agencies as to the quality of debt securities. It should be emphasized, however, that ratings are general and are not absolute standards of quality, and debt securities with the same maturity, interest rate and rating may have different yields, while debt securities of the same maturity and interest rate with different ratings may have the same yield.

The payment of principal and interest on most debt securities will depend upon the ability of the issuers to meet their obligations. An issuer's obligations in connection with its debt securities are subject to the provisions of bankruptcy, insolvency and other laws affecting the rights and remedies of creditors, such as the Federal Bankruptcy Code, and laws, if any, which may be enacted by federal or state legislatures extending the time for payment of principal or interest, or both, or imposing other constraints upon enforcement of such obligations. The power or ability of an issuer to meet its obligations for the payment of interest on, and principal of, its debt securities may be materially adversely affected by litigation or other conditions.

Subsequent to its purchase by a Fund, a rated security may cease to be rated or its rating may be reduced below the minimum rating required for purchase by the Fund. The Advisor will consider such an event in determining whether the Fund involved should continue to hold the security. For a more detailed description of the ratings of debt securities, see <u>Appendix A</u> to this SAI.

**Emerging Market Countries**

The Funds may invest in emerging market countries or developing countries as defined by the World Bank, International Financial Corporation or any country included in an "emerging markets" index.

Investments in companies domiciled or with significant operations in developing market or emerging market countries may be subject to potentially higher risks than investments in developed countries. These risks include, among others (i) less social, political and economic stability; (ii) smaller securities markets with low or nonexistent trading volume, which result in greater illiquidity and greater price volatility; (iii) certain national policies which may restrict a Fund's investment opportunities, including restrictions on investment in issuers or industries deemed sensitive to national interests; (iv) foreign taxation, including less transparent and established taxation policies; (v) less developed regulatory or legal structures governing private or foreign investment or allowing for judicial redress for injury to private property; (vi) the absence, until recently in many developing market countries, of a capital market structure or market-oriented economy; (vii) more widespread corruption and fraud; (viii) the financial institutions with which a Fund may trade may not possess the same degree of financial sophistication, creditworthiness or resources as those in developed markets; and (ix) the possibility that recent favorable economic developments in some developing market countries may be slowed or reversed by unanticipated economic, political or social events in such countries.

Due to political, military or regional conflicts or due to terrorism or war, it is possible that the United States, other nations or other governmental entities (including supranational entities) could impose sanctions on certain issuers that limit or restrict foreign investment, the movement of assets or other economic activity in a country that is involved in such conflicts. Such sanctions or other intergovernmental actions could result in the devaluation of a country's currency, a downgrade in the credit ratings of issuers in such country, or a decline in the value and liquidity of securities of issuers in that country. In addition, an imposition of sanctions upon certain issuers in a country could result in an immediate freeze of that issuer's securities, impairing the ability of a Fund to buy, sell, receive or deliver those securities. Counter measures could be taken by the country's government, which could involve the seizure of a Fund's assets. In addition, such actions could adversely affect a country's economy, possibly forcing the economy into a recession.

In addition, many developing market countries have experienced substantial, and during some periods, extremely high rates of inflation, for many years. Inflation and rapid fluctuations in inflation rates have had, and may continue to have, negative effects on the economies and securities markets of certain countries. Moreover, the economies of some developing market countries may differ unfavorably from the U.S. economy in such respects as growth of gross domestic product, rate of inflation, currency depreciation, debt burden, capital reinvestment, resource self-sufficiency and balance of payments position. The economies of some developing market countries may be based on only a few industries, and may be highly vulnerable to changes in local or global trade conditions.

Settlement systems in developing market countries may be less organized than in developed countries. Supervisory authorities may also be unable to apply standards which are comparable with those in more developed countries. There may be risks that settlement may be delayed and that cash or securities belonging to a Fund may be in jeopardy because of failures of or defects in the settlement systems. Market practice may require that payment be made prior to receipt of the security which is being purchased or that delivery of a security must be made before payment is received. In such cases, default by a broker or bank (the "counterparty") through whom the relevant transaction is effected might result in a loss being suffered by a Fund. Each Fund seeks, where possible, to use counterparties whose financial status reduces this risk. However, there can be no certainty that a Fund will be successful in eliminating or reducing this risk, particularly as counterparties operating in developing market countries frequently lack the substance, capitalization and/or financial resources of those in developed countries. Uncertainties in the operation of settlement systems in individual markets may increase the risk of competing claims to securities held by or to be transferred to a Fund. Legal compensation schemes may be non-existent, limited or inadequate to meet a Fund's claims in any of these events.

Securities trading in developing markets presents additional credit and financial risks. A Fund may have limited access to, or there may be a limited number of, potential counterparties that trade in the securities of developing market issuers. Governmental regulations may restrict potential counterparties to certain financial institutions located or operating in the particular developing market. Potential counterparties may not possess, adopt or implement creditworthiness standards, financial reporting standards or legal and contractual protections similar to those in developed markets. Currency and other hedging techniques may not be available or may be limited.

The local taxation of income and capital gains accruing to non-residents varies among developing market countries and may be comparatively high. Developing market countries typically have less well-defined tax laws and procedures and such laws may permit retroactive taxation so that a Fund could in the future become subject to local tax liabilities that had not been anticipated in conducting its investment activities or valuing its assets.

Many developing market countries suffer from uncertainty and corruption in their legal frameworks. Legislation may be difficult to interpret and laws may be too new to provide any precedential value. Laws regarding foreign investment and private property may be weak or non-existent. Investments in developing market countries may involve risks of nationalization, expropriation and confiscatory taxation. For example, the Communist governments of a number of Eastern European countries expropriated large amounts of private property in the past, in many cases without adequate compensation, and there can be no assurance that similar expropriation will not occur in the future. In the event of expropriation, a Fund could lose all or a substantial portion of any investments it has made in the affected countries. Accounting, auditing and reporting standards in certain countries in which a Fund may invest may not provide the same degree of investor protection or information to investors as would generally apply in major securities markets. In addition, it is possible that purported securities in which a Fund invested may subsequently be found to be fraudulent and as a consequence a Fund could suffer losses.

Finally, currencies of developing market countries are subject to significantly greater risks than currencies of developed countries. Some developing market currencies may not be internationally traded or may be subject to strict controls by local governments, resulting in undervalued or overvalued currencies and associated difficulties with the valuation of assets, including a Fund's securities, denominated in that currency. Some developing market countries have experienced balance of payment deficits and shortages in foreign exchange reserves. Governments have responded by restricting currency conversions. Future restrictive exchange controls could prevent or restrict a company's ability to make dividend or interest payments in the original currency of the obligation (usually U.S. dollars). In addition, even though the currencies of some developing market countries, such as certain Eastern European countries, may be convertible into U.S. dollars, the conversion rates may be artificial to the actual market values and may be adverse to a Fund's shareholders.

**Exchange-Traded Funds ("ETFs")**

The Funds may invest in shares of ETFs. An ETF is an investment company and typically is registered under the 1940 Act. Some ETFs are unregistered investment companies that invest directly in securities, commodities or other assets (such as precious metals). Most ETFs hold a portfolio of investments designed to track the performance of a particular index; however, certain ETFs utilize active management of their investment portfolios. An ETF sells and redeems its shares at NAV in large blocks (typically 50,000 of its shares or more) called "creation units." Shares representing fractional interests in these creation units are listed for trading on one or more national securities exchanges and can be purchased and sold in the secondary market in lots of any size at any time during the trading day. Trading of ETFs may be halted by the activation of individual or marketwide trading halts, or if the ETFs are delisted from an exchange. In addition, because ETFs are listed on national stock exchanges and are traded like stocks listed on an exchange, (1) a Fund may acquire ETF shares at a discount or premium to their NAV and (2) ETFs are subject to brokerage and other trading costs, which could result in greater expenses to a Fund.

Investments in an ETF involve certain risks generally associated with investments in a broadly based portfolio of securities, including risks that the general level of stock prices may decline, thereby adversely affecting the value of each unit of the ETF or other instrument. In addition, an ETF may not fully replicate the performance of its benchmark index because of the temporary unavailability of certain investments in the secondary market or discrepancies between the ETF and the index with respect to the weighting or number of investments held. ETFs that invest in other assets, such as commodities, are subject to the risks associated with directly investing in those assets. Furthermore, certain ETFs may be thinly traded and experience large spreads between the "ask" price quoted by a seller and the "bid" price quoted by a buyer.

Because ETFs and pools that issue similar instruments bear various fees and expenses, a Fund's investment in these instruments will involve certain indirect costs, as well as transaction costs, such as brokerage commissions. The Advisor may consider the expenses associated with an investment in determining whether to invest in an ETF. See the section "Investment Companies" below for information about investments in investment companies generally.

**Exchange-Traded Notes ("ETNs")**

The Funds may invest in ETNs. ETNs are debt securities that are traded on an exchange (*e.g.*, the New York Stock Exchange) whose returns are linked to the performance of a particular market benchmark or strategy. If a Fund holds an ETN to maturity, the issuer of the ETN will pay the Fund a cash amount that is linked to the performance of the corresponding index during the period beginning on the inception date and ending at maturity, less investor fees. ETNs generally do not make periodic coupon payments or provide principal protection. An ETN that is tied to a specific benchmark or strategy may not produce returns that replicate exactly the performance of its corresponding benchmark or strategy.

ETNs are subject to credit risk, including the credit risk of the issuer. The value of an ETN may drop due to a downgrade in the issuer's credit rating, even when the underlying benchmark or strategy remains unchanged. An ETN may trade at a premium or discount to its benchmark or strategy. The value of an ETN may be influenced by time to maturity, level of supply and demand for the ETN, volatility and lack of liquidity in underlying assets, changes in the applicable interest rates, changes in the issuer's credit rating, and economic, legal, political, or geographic events that affect the referenced underlying assets. When a Fund invests in ETNs, it will bear its proportionate share of any fees and expenses borne by the ETN. A decision by the Fund to sell ETN holdings may be limited by the availability of a secondary market. Some ETNs that use leverage may be relatively illiquid at times and, as a result, may be difficult to purchase or sell at a fair price. Leveraged ETNs are subject to the same risk as other instruments that use leverage.

**Foreign Currency Transactions**

Although the Funds value their assets daily in U.S. dollars, they are not required to exchange their holdings of foreign currencies to U.S. dollars on a daily basis. A Fund's foreign currencies generally will be held as "foreign currency call accounts" at foreign branches of foreign or domestic banks. These accounts bear interest at negotiated rates and are payable upon relatively short demand periods. If a bank at which a Fund maintains such an account becomes insolvent, the Fund could suffer a loss of some or all of the amounts deposited. A Fund may exchange foreign currency to U.S. dollars from time to time. Although foreign exchange dealers generally do not charge a stated commission or fee for conversion, the prices posted generally include a "spread," which is the difference between the prices at which the dealers are buying and selling foreign currencies.

The Funds may enter into forward currency contracts. A forward currency contract is an obligation to purchase or sell a specific non-U.S. currency in exchange for another currency, which may be U.S. dollars, at an agreed exchange rate (price) at a future date. Forward currency contracts are typically individually negotiated and privately traded by currency traders and their customers in the interbank market.

On October 28, 2020, the SEC adopted Rule 18f-4 under the 1940 Act relating to a registered investment company's use of derivatives and related instruments. Rule 18f-4 prescribes specific value-at-risk leverage limits for certain derivatives users and requires certain derivatives users to adopt and implement a derivatives risk management program (including the appointment of a derivatives risk manager and the implementation of certain testing requirements), and prescribes reporting requirements in respect of derivatives. Subject to certain conditions, if a fund qualifies as a "limited derivatives user," as defined in Rule 18f-4, it is not subject to the full requirements of Rule 18f-4. In connection with the adoption of Rule 18f-4, the SEC rescinded certain of its prior guidance regarding asset segregation and coverage requirements in respect of derivatives transactions and related instruments. With respect to reverse repurchase agreements or other similar financing transactions in particular, Rule 18f-4 permits a fund to enter into such transactions if the fund either (i) complies with the asset coverage requirements of Section 18 of the 1940 Act, and combines the aggregate amount of indebtedness associated with all tender option bonds or similar financing with the aggregate amount of any other senior securities representing indebtedness when calculating the relevant asset coverage ratio, or (ii) treats all tender option bonds or similar financing transactions as derivatives transactions for all purposes under Rule 18f-4. The Funds have adopted procedures for investing in derivatives and other transactions in compliance with Rule 18f-4. Rule 18f-4 under the 1940 Act may require a Fund to observe more stringent asset coverage and related requirements than were previously imposed by the 1940 Act, which could adversely affect the value or performance of the Fund. Limits or restrictions applicable to the counterparties or issuers, as applicable, with which the Fund may engage in derivative transactions could also limit or prevent the Fund from using certain instruments.

Certain transactions involving forward currency contracts may serve as long hedges (for example, if a Fund seeks to buy a security denominated in a foreign currency, it may purchase a forward currency contract to lock in the U.S. dollar price of the security) or as short hedges (if a Fund anticipates selling a security denominated in a foreign currency, it may sell a forward currency contract to lock in the U.S. dollar equivalent of the anticipated sales proceeds).

A Fund may seek to hedge against changes in the value of a particular currency by using forward contracts on another foreign currency or a basket of currencies, the value of which the Advisor believes will have a positive correlation to the values of the currency being hedged. In addition, each Fund may use forward currency contracts to shift exposure to foreign currency fluctuations from one country to another. For example, if a Fund owns securities denominated in a foreign currency and the Advisor believes that currency will decline relative to another currency, it might enter into a forward contract to sell an appropriate amount of the first foreign currency, with payment to be made in the second currency. Transactions that use two foreign currencies are sometimes referred to as "cross hedges." Use of different foreign currency magnifies the risk that movements in the price of the instrument will not correlate or will correlate unfavorably with the foreign currency being hedged.

The cost to a Fund of engaging in forward currency contracts or currency futures contracts varies with factors such as the interest rate environments in the relevant countries, the currencies involved, the length of the contract period and the market conditions then prevailing. Because forward currency contracts are usually entered into on a principal basis, no fees or commissions are involved. When a Fund enters into a forward currency contract, it relies on the counterparty to make or take delivery of the underlying currency at the maturity of the contract. Failure by the counterparty to do so would result in the loss of any expected benefit of the transaction.

As is the case with futures contracts, holders and writers of forward currency contracts can enter into offsetting closing transactions, similar to closing transactions on futures, by selling or purchasing, respectively, an instrument identical to the instrument held or written. Secondary markets generally do not yet exist for forward currency contracts, with the result that closing transactions generally can be made for forward currency contacts only by negotiating directly with the counterparty. Thus, there can be no assurance that a Fund will in fact be able to close out a forward currency contract at a favorable price. In addition, in the event of insolvency of the counterparty, a Fund might be unable to close out a forward currency contract.

The successful use of forward currency contracts will usually depend on Advisor's ability to accurately forecast currency exchange rate movements. Should exchange rates move in an unexpected manner, a Fund may not achieve the anticipated benefits of the transaction, or it may realize losses. In addition, these techniques could result in a loss if the counterparty to the transaction does not perform as promised, including because of the counterparty's bankruptcy or insolvency. Investors should bear in mind that a Fund is not obligated to actively engage in hedging or other currency transactions. For example, a Fund may not have attempted to hedge its exposure to a particular foreign currency at a time when doing so might have avoided a loss.

Forward currency contracts may limit potential gain from a positive change in the relationship between the U.S. dollar and foreign currencies. Unanticipated changes in currency prices may result in poorer overall performance for a Fund than if it had not engaged in such contracts. Moreover, there may be an imperfect correlation between a Fund's portfolio holdings of securities denominated in a particular currency and the currencies bought or sold in the forward contracts entered into by the Fund. This imperfect correlation may cause the Fund to sustain losses that will prevent the Fund from achieving a complete hedge or expose the Fund to risk of foreign exchange loss.

**Foreign Securities**

Each Fund's investments in the securities of foreign issuers may include both securities of foreign corporations and securities of foreign governments and their political subdivisions.

The Funds may invest in foreign securities directly, or through depositary receipts, such as American Depositary Receipts ("ADRs") or Global Depositary Receipts ("GDRs"). Depositary receipts are typically issued by a U.S. or foreign bank or trust company and evidence ownership of underlying securities issued by a foreign corporation.

There are substantial risks associated with investing in the securities of governments and companies located in, or having substantial operations in, foreign countries, which are in addition to the usual risks inherent in domestic investments. The value of foreign securities (like U.S. securities) is affected by general economic conditions and individual issuer and industry earnings prospects. Investments in depositary receipts also involve some or all of the risks described below.

There is the possibility of cessation of trading on foreign exchanges, expropriation, nationalization of assets, confiscatory or punitive taxation, withholding and other foreign taxes on income or other amounts, foreign exchange controls (which may include suspension of the ability to transfer currency from a given country), restrictions on removal of assets, political or social instability, military action or unrest, or diplomatic developments, including sanctions imposed by other countries or governmental entities, that could affect investments in securities of issuers in foreign nations. There is no assurance that the Advisor will be able to anticipate these potential events. In addition, the value of securities denominated in foreign currencies and of dividends and interest paid with respect to such securities will fluctuate based on the relative strength of the U.S. dollar.

There may be less publicly available information about foreign issuers comparable to the reports and ratings published about issuers in the U.S. Foreign issuers generally are not subject to uniform accounting or financial reporting standards. Auditing practices and requirements may not be comparable to those applicable to U.S. issuers. Certain countries' legal institutions, financial markets and services are less developed than those in the U.S. or other major economies. A Fund may have greater difficulty voting proxies, exercising shareholder rights, securing dividends and obtaining information regarding corporate actions on a timely basis, pursuing legal remedies, and obtaining judgments with respect to foreign investments in foreign courts than with respect to domestic issuers in U.S. courts. The costs associated with foreign investments, including withholding taxes, brokerage commissions, and custodial costs, are generally higher than with U.S. investments.

Certain countries require governmental approval prior to investments by foreign persons, or limit the amount of investment by foreign persons in a particular company. Some countries limit the investment of foreign persons to only a specific class of securities of an issuer that may have less advantageous terms than securities of the issuer available for purchase by nationals. Although securities subject to such restrictions may be marketable abroad, they may be less liquid than foreign securities of the same class that are not subject to such restrictions. In some countries the repatriation of investment income, capital and proceeds of sales by foreign investors may require governmental registration and/or approval. A Fund could be adversely affected by delays in or a refusal to grant any required governmental registration or approval for repatriation.

From time to time, trading in a foreign market may be interrupted. Foreign markets also have substantially less volume than the U.S. markets and securities of some foreign issuers are less liquid and more volatile than securities of comparable U.S. issuers. A Fund, therefore, may encounter difficulty in obtaining market quotations for purposes of valuing its portfolio and calculating its NAV.

In many foreign countries there is less government supervision and regulation of stock exchanges, brokers, and listed companies than in the U.S., which may result in greater potential for fraud or market manipulation. Foreign over-the-counter markets tend to be less regulated than foreign stock exchange markets and, in certain countries, may be totally unregulated. Brokerage commission rates in foreign countries, which generally are fixed rather than subject to negotiation as in the U.S., are likely to be higher. Foreign security trading, settlement and custodial practices (including those involving securities settlement where assets may be released prior to receipt of payment) are often less developed than those in U.S. markets, may be cumbersome and may result in increased risk or substantial delays. This could occur in the event of a failed trade or the insolvency of, or breach of duty by, a foreign broker-dealer, securities depository, or foreign sub-custodian.

To the extent that a Fund invests a significant portion of its assets in a specific geographic region or country, the Fund will have more exposure to economic risks related to such region or country than a fund whose investments are more geographically diversified. Adverse conditions or changes in policies in a certain region or country can affect securities of other countries whose economies appear to be unrelated but are otherwise connected. In the event of economic or political turmoil, a deterioration of diplomatic relations or a natural or man-made disaster in a region or country where a substantial portion of a Fund's assets are invested, the Fund may have difficulty meeting a large number of shareholder redemption requests. The holding of foreign securities may be limited by a Fund to avoid investment in certain Passive Foreign Investment Companies ("PFICs") and the imposition of a PFIC tax on the Fund resulting from such investments.

In June 2016, the United Kingdom (the "UK") approved a referendum to leave the European Union ("EU"). The withdrawal, known colloquially as "Brexit", was agreed to and ratified by the UK Parliament, and the UK left the EU on January 31, 2020. It began an 11-month transition period in which to negotiate a new trading relationship for goods and services that ended on December 31, 2020. The UK and the EU signed the Trade and Cooperation Agreement ("TCA") on December 30, 2020, which was applied provisionally as of January 1, 2021 and entered into force on May 1. 2021. The TCA is an agreement on the terms governing certain aspects of the relationship between the EU and the UK following the end of the transition period. Further discussions are to be held between the UK and the EU in relation to matters not covered by the trade agreement, such as financial services. Brexit may have significant political and financial consequences for the Eurozone markets, including greater volatility in the global stock markets and illiquidity, fluctuations in currency and exchange rates, and an increased likelihood of a recession in the UK. At this time, the impact of Brexit cannot be predicted, however, market disruption in the EU and globally may have a negative effect on the value of the Funds' investments. Additionally, the risks related to Brexit could be more pronounced if one or more additional EU member states seek to leave the EU.

In February 2022, Russia commenced a military attack on Ukraine. The outbreak of hostilities between the two countries and the threat of wider-spread hostilities could have a severe adverse effect on the region and global economies, including significant negative impacts on the markets for certain securities and commodities, such as oil and natural gas. In addition, sanctions imposed on Russia by the United States and other countries, and any sanctions imposed in the future could have a significant adverse impact on the Russian economy and related markets. The price and liquidity of investments may fluctuate widely as a result of the conflict and related events. How long the armed conflict and related events will last cannot be predicted. These tensions and any related events could have a significant impact on Fund performance and the value of Fund investments, even beyond any direct exposure a Fund may have to issuers located in these countries.

**Foreign Currency Exchange Rates**

Changes in foreign currency exchange rates will affect the U.S. dollar market value of securities denominated in such foreign currencies and any income received or expenses paid by a Fund in that foreign currency. This may affect a Fund's share price, income and distributions to shareholders. Some countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. It will be more difficult for the Advisor to value securities denominated in currencies that are fixed or managed. Certain currencies may not be internationally traded, which could cause illiquidity with respect to a Fund's investments in that currency and any securities denominated in that currency. Currency markets generally are not as regulated as securities markets. Each Fund endeavors to buy and sell foreign currencies on as favorable a basis as practicable. Some price spread in currency exchanges (to cover service charges) may be incurred, particularly when a Fund changes investments from one country to another or when proceeds of the sale of securities in U.S. dollars are used for the purchase of securities denominated in foreign currencies. Some countries may adopt policies that would prevent a Fund from transferring cash out of the country or withhold portions of interest and dividends at the source.

Certain currencies have experienced a steady devaluation relative to the U.S. dollar. Any devaluations in the currencies in which a Fund's portfolio securities are denominated may have a detrimental impact on the Fund. Where the exchange rate for a currency declines materially after a Fund's income has been accrued and translated into U.S. dollars, the Fund may need to redeem portfolio securities to make required distributions. Similarly, if an exchange rate declines between the time a Fund incurs expenses in U.S. dollars and the time such expenses are paid, the Fund will have to exchange a greater amount of the currency into U.S. dollars in order to pay the expenses.

Investing in foreign currencies for purposes of gaining from projected changes in exchange rates further increases a Fund's exposure to foreign securities losses.

**Futures Contracts**

The Funds may purchase or sell futures contracts traded on domestic and foreign exchanges, including those based on particular interest rates, securities, foreign currencies, securities indices and other financial instruments and indices. The Funds may also purchase and write call and put options on such futures contracts, in order to seek to increase total return or to hedge against changes in interest rates, securities prices, or currency exchange rates, or, to the extent permitted by its investment policies, to otherwise manage its portfolio of investments. The Funds may purchase or sell currency futures contracts. Generally, a futures contract is a standard binding agreement to buy or sell a specified quantity of an underlying reference instrument, such as a specific security, currency or commodity, at a specified price at a specified later date. Although some futures contracts by their terms require the actual delivery or acquisition of the underlying instrument or asset, some require cash settlement. In most cases the contractual obligation under a futures contract may be offset, or "closed out," before the settlement date so that the parties do not have to make or take delivery.

A Fund has the ability to buy and sell stock index futures contracts. A stock index futures contract is an agreement between two parties to take or make delivery of an amount of cash equal to a specified dollar amount, times the difference between the stock index value at the close of the last trading day of the contract and the price at which the futures contract is originally struck. A stock index futures contract does not involve the physical delivery of the underlying stocks in the index. Although stock index futures contracts call for the actual taking or delivery of cash, in most cases a Fund expects to liquidate its stock index futures positions through offsetting transactions, which may result in a gain or a loss, before cash settlement is required.

Futures contracts in the U.S. have been designed by exchanges that have been designated "contract markets" by the CFTC and must be executed through a futures commission merchant ("FCM"), which is a brokerage firm that is a member of the relevant contract market. Futures contracts may also be entered into on certain exempt markets, including exempt boards of trade and electronic trading facilities, available to certain market participants.

A Fund will incur brokerage fees when it purchases and/or sells futures contracts, and at the time a Fund purchases or sells a futures contract, it must make a good faith deposit known as the "initial margin." Thereafter, a Fund may need to make subsequent deposits, known as "variation margin," to reflect changes in the marked-to-market value of the futures contract.

The Fund is required to comply with Rule 18f-4 under the 1940 Act. See the section entitled "Foreign Currency Transactions" above for additional information.

Futures are derivative instruments that are subject to a number of risks. Purchases and sales of stock index futures contracts may not completely offset a decline or rise in the value of a Fund's investments during certain market conditions. In the futures markets, it may not always be possible to execute a buy or sell order at the desired price, or to close out an open position due to market conditions, limits on open positions and/or daily price fluctuations. Changes in the market value of a Fund's investment securities may differ substantially from the changes anticipated by a Fund when it established its hedged positions, and unanticipated price movements in a futures contract may result in a loss substantially greater than such Fund's initial investment in such a contract.

There is a risk of loss by a Fund of the initial and variation margin deposits in the event of bankruptcy of the FCM with which the Fund has an open position in a futures contract. The assets of a Fund may not be fully protected in the event of the bankruptcy of the FCM or central counterparty because the Fund might be limited to recovering only a pro rata share of all available funds and margin segregated on behalf of an FCM's customers. If an FCM does not provide accurate reporting, a Fund is also subject to the risk that the FCM could use the Fund's assets, which are held in an omnibus account with assets belonging to the FCM's other customers, to satisfy its own financial obligations or the payment obligations of another customer to the central counterparty.

There is no assurance that an active market will exist for any particular contract or at any particular time. An active market makes it more likely that futures contracts will be liquid and bought and sold at competitive market prices. In addition, many of the futures contracts available may be relatively new instruments without a significant trading history. As a result, there can be no assurance that an active market will develop or continue to exist.

Successful use of futures contracts depends upon the Advisor's ability to correctly predict movements in the securities markets generally or of a particular segment of a securities market. No assurance can be given that the Advisor's judgment in this respect will be correct.

The CFTC and the various exchanges have established limits, referred to as "speculative position limits," on the maximum net long or net short position that any person may hold or control in a particular futures contract. Trading limits are imposed on the number of contracts that any person may trade on a particular trading day. An exchange may order the liquidation of positions found to be in violation of these limits and it may impose sanctions or restrictions. Futures exchanges may also limit the amount of fluctuation permitted in certain futures contract prices during a single trading day. This daily limit establishes the maximum amount that the price of a futures contract may vary either up or down from the previous day's settlement price. Once the daily limit has been reached in a futures contract subject to the limit, no more trades may be made on that day at a price beyond that limit. The daily limit governs only price movements during a particular trading day and does not limit potential losses because the limit may prevent the liquidation of unfavorable positions.

Participation in foreign futures and foreign options transactions involves the execution and clearing of trades on or subject to the rules of a foreign board of trade. Neither the National Futures Association nor any domestic exchange regulates activities of any foreign boards of trade, including the execution, delivery and clearing of transactions, or has the power to compel enforcement of the rules of a foreign board of trade or any applicable foreign law. This is true even if the exchange is formally linked to a domestic market so that a position taken on the market may be liquidated by a transaction on another market. Moreover, such laws or regulations will vary depending on the foreign country in which the foreign futures or foreign options transaction occurs. Futures contracts that are traded on non-U.S. exchanges may not be as liquid as those purchased on CFTC-designated contract markets.

Customers who trade foreign futures of foreign options contracts may not be afforded certain of the protective measures provided by the CEA, the CFTC's regulations and the rules of the National Futures Association and any domestic exchange, including the right to use reparations proceedings before the CFTC and arbitration proceedings provided by the National Futures Association or any domestic futures exchange. In particular, a Fund's investments in foreign futures or foreign options transactions may not be provided the same protections in respect of transactions on U.S. futures exchanges. In addition, the price of any foreign futures or foreign options contract and, therefore the potential profit and loss thereon may be affected by any variance in the foreign exchange rate between the time an order is placed and the time it is liquidated, offset or exercised.

**Index Warrants**

The Funds may purchase put warrants and call warrants whose values vary depending on the change in the value of one or more specified indices ("index warrants"). Index warrants are generally issued by banks or other financial institutions and give the holder the right, at any time during the term of the warrant, to receive upon exercise of the warrant a cash payment from the issuer based on the value of the underlying index at the time of exercise. In general, if the value of the underlying index rises above the exercise price of the index warrant, the holder of a call warrant will be entitled to receive a cash payment from the issuer upon exercise based on the difference between the value of the index and the exercise price of the warrant; if the value of the underlying index falls, the holder of a put warrant will be entitled to receive a cash payment from the issuer upon exercise based on the difference between the exercise price of the warrant and the value of the index. The holder of a warrant would not be entitled to any payments from the issuer at a time when, in the case of a call warrant, the exercise price is more than the value of the underlying index, or in the case of a put warrant, the exercise price is less than the value of the underlying index. If a Fund were not to exercise an index warrant prior to its expiration, a Fund would lose the amount of the purchase price it paid for the warrant. A Fund will normally use index warrants in a manner similar to its use of options on indices.

**Inflation-Linked and Inflation-Indexed Securities**

The Funds may invest in inflation-linked bonds. The principal amount of these bonds increases with increases in the price index used as a reference value for the bonds. In addition, the amounts payable as coupon interest payments increase when the price index increases because the interest amount is calculated by multiplying the principal amount (as adjusted) by a fixed coupon rate.

Although inflation-indexed securities protect their holders from long-term inflationary trends, short-term increases in inflation may result in a decline in value. The values of inflation-linked securities generally fluctuate in response to changes to real interest rates, which are in turn tied to the relationship between nominal interest rates and the rate of inflation. If inflation were to rise at a rate faster than nominal interest rates, real interest rates might decline, leading to an increase in value of the inflation-linked securities. In contrast, if nominal interest rates increased at a faster rate than inflation, real interest rates might rise, leading to a decrease in the value of inflation-linked securities. If inflation is lower than expected during a period a Fund holds inflation-linked securities, a Fund may earn less on such bonds than on a conventional bond. If interest rates rise due to reasons other than inflation (for example, due to changes in currency exchange rates), investors in inflation-linked securities may not be protected to the extent that the increase is not reflected in the price index used as a reference for the securities. There can be no assurance that the price index used for an inflation-linked security will accurately measure the real rate of inflation in the prices of goods and services. Inflation-linked and inflation-indexed securities include Treasury Inflation-Protected Securities issued by the U.S. government (see the section "U.S. Government Obligations" below for additional information), but also may include securities issued by state, local and non-U.S. governments and corporations and supranational entities.

**Initial Public Offerings**

A Fund may purchase initial public offerings ("IPOs") in accordance with its investment strategies. IPO shares frequently are volatile in price, and may be held for only a short period of time, leading to increased portfolio turnover and expenses, such as commissions and transaction costs. When sold, IPO shares may result in realized taxable gains. In addition, the market for IPO shares can be speculative and/or inactive for extended periods of time. Limited trading in some IPOs may make it more difficult to buy or sell significant amounts of shares without an unfavorable impact on prevailing prices. Holders of IPO shares also may be affected by: substantial dilution in the value of their shares, sales of additional shares, and concentration of control in existing management and principal shareholders. In addition, some companies in IPOs may have limited operating histories, may be undercapitalized, and may not have invested in or experienced a full market cycle.

**Investments in Banks**

The Funds may invest in certificates of deposit (certificates representing the obligation of a bank to repay funds deposited with it for a specified period of time), time deposits (non-negotiable deposits maintained in a bank for a specified period of time up to seven days at a stated interest rate), bankers' acceptances (credit instruments evidencing the obligation of a bank to pay a draft drawn on it by a customer) and other securities and instruments issued by domestic banks, foreign branches of domestic banks, foreign subsidiaries of domestic banks and domestic and foreign branches of foreign banks.

A Fund also may purchase U.S. dollar-denominated obligations issued by foreign branches of domestic banks or foreign branches of foreign banks ("Eurodollar" obligations) and domestic branches of foreign banks ("Yankee dollar" obligations).

Eurodollar and other foreign obligations involve special investment risks, including the possibility that (i) liquidity could be impaired because of future political and economic developments, (ii) the obligations may be less marketable than comparable domestic obligations of domestic issuers, (iii) a foreign jurisdiction might impose withholding taxes on interest income payable on those obligations, (iv) deposits may be seized or nationalized, (v) foreign governmental restrictions, such as exchange controls, may be adopted, which might adversely affect the payment of principal and interest on those obligations, (vi) the selection of foreign obligations may be more difficult because there may be less information publicly available concerning foreign issuers, (vii) there may be difficulties in securing or enforcing a judgment against a foreign issuer, and (viii) the accounting, auditing and financial reporting standards, practices and requirements applicable to foreign issuers may differ from those applicable to domestic issuers. In addition, foreign banks are not subject to examination by U.S. government agencies or instrumentalities.

**Investment Companies**

The Funds may invest in other investment companies, including ETFs, to the extent permitted by the 1940 Act, SEC rules thereunder and exemptions thereto. Section 12(d)(1)(A) of the 1940 Act requires that, as determined immediately after a purchase is made, (i) not more than 5% of the value of the Fund's total assets will be invested in the securities of any one investment company, (ii) not more than 10% of the value of the Fund's total assets will be invested in securities of investment companies as a group, and (iii) not more than 3% of the outstanding voting stock of any one investment company will be owned by the Fund. Certain exceptions to these limitations may apply, and the Funds may also rely on any applicable SEC rules or orders that provide exceptions to these limitations.

As a matter of policy, the Penn Capital Floating Rate Income Fund will not purchase shares of any registered open-end investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the "fund of funds" provisions) of the 1940 Act, at any time the Fund has knowledge that its shares are purchased by another investment company investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).

Investment companies are essentially pools of securities. Investing in other investment companies involves substantially the same risks as investing directly in the underlying securities, but may involve additional expenses at the investment company level, such as investment advisory fees and operating expenses. In some cases, investing in an investment company may involve the payment of a premium over the value of the assets held in that investment company's portfolio. As an investor in another investment company, a Fund will bear its ratable share of the investment company's expenses, including advisory fees, and a Fund's shareholders will bear such expenses indirectly, in addition to similar fees and expenses of a Fund. Despite the possibility of greater fees and expenses, the Advisor will invest if it believes investment in other investment companies provides attractive return opportunities. In addition, it may be more efficient for a Fund to gain exposure to particular market segments by investing in shares of one or more investment companies.

The SEC has adopted revisions to the rules permitting funds to invest in other investment companies in excess of the limits described above. While Rule 12d1-4 permits more types of fund of fund arrangements without reliance on an exemptive order or no-action letters, it imposes new conditions, including limits on control and voting of acquired funds' shares, evaluations and findings by investment advisers, fund investment agreements, and limits on most three-tier fund structures. Rule 12d1-4 went into effect on January 19, 2021. The rescission of the applicable exemptive orders and the withdrawal of the applicable no-action letters was effective on January 19, 2022.

**LIBOR Transition Risk**

Many financial instruments may be tied to the London Interbank Offered Rate, or "LIBOR," to determine payment obligations, financing terms, hedging strategies, or investment value. LIBOR is the offered rate for short-term Eurodollar deposits between major international banks. As of December 31, 2021, all non-U.S. dollar LIBOR publications have been phased out and a majority of U.S. dollar LIBOR settings will cease publication after June 30, 2023. It is possible that a subset of LIBOR settings will be published after these dates on a "synthetic" basis, but any such publications would be considered non-representative of the underlying market. The U.S. Federal Reserve, based on the recommendations of the New York Federal Reserve's Alternative Reference Rate Committee (comprised of major derivative market participants and their regulators), has begun publishing SOFR that is intended to replace U.S. dollar LIBOR. Proposals for alternative reference rates for other currencies have also been announced or have already begun publication. Markets are slowly developing in response to these new reference rates. Uncertainty related to the liquidity impact of the change in rates, and how to appropriately adjust these rates at the time of transition, poses risks for the Funds. The effect of any changes to, or discontinuation of, LIBOR on the Funds will depend on, among other things, (1) existing fallback or termination provisions in individual contracts and (2) whether, how, and when industry participants develop and adopt new reference rates and fallbacks for both legacy and new instruments and contracts. The expected discontinuation of LIBOR could have a significant impact on the financial markets in general and may also present heightened risk to market participants, including public companies, investment advisers, investment companies, and broker-dealers. The risks associated with this discontinuation and transition will be exacerbated if the work necessary to effect an orderly transition to an alternative reference rate is not completed in a timely manner. For example, current information technology systems may be unable to accommodate new instruments and rates with features that differ from LIBOR. Accordingly, it is difficult to predict the full impact of the transition away from LIBOR on the Funds until new reference rates and fallbacks for both legacy and new instruments and contracts are commercially accepted and market practices become settled.

**Loan Based Derivatives**

The Funds may invest in derivative instruments that provide exposure to one or more credit default swaps. For example, a Fund may invest in a derivative instrument known as the Loan-Only Credit Default Swap Index ("LCDX"), a tradable index with 100 equally weighted underlying single-name loan-only credit default swaps ("LCDS"). Each underlying LCDS references an issuer whose loans trade in the secondary leveraged loan market. A Fund can either buy the index (take on credit exposure) or sell the index (pass credit exposure to a counterparty). While investing in these types of derivatives will increase the universe of debt securities to which a Fund is exposed, such investments entail additional risks, such as those discussed below, that are not typically associated with investments in other debt securities. Credit default swaps and other derivative instruments related to loans are subject to the risks associated with loans generally, as well as the risks of derivative transactions. For more information, see the section "Swaps--Interest Rate Swaps, Mortgage Swaps, Credit Swaps, Currency Swaps, Total Return Swaps, Options on Swaps and Interest Rate Caps, Floors and Collars, Inflation Indexed Swaps" below.

**Mortgage-Backed Securities**

The Funds may purchase mortgage-backed securities. Mortgage-backed securities are interests in pools of mortgage loans, including mortgage loans made by savings and loan institutions, mortgage bankers, commercial banks and others. Pools of mortgage loans are assembled as securities for sale to investors by various governmental, government-related and private organizations as further described below. The Funds may also purchase debt securities which are secured with collateral consisting of mortgage-backed securities ("Collateralized Mortgage Obligations") and in other types of mortgage-related securities. Mortgage-backed securities may be issued or guaranteed by U.S. government entities, such as the Government National Mortgage Association ("GNMA"), or by private lenders.

The timely payment of principal and interest on mortgage-backed securities issued or guaranteed by GNMA is backed by GNMA and the full faith and credit of the U.S. government. These guarantees, however, do not apply to the market value of fund shares. Also, securities issued by GNMA and other mortgage-backed securities may be purchased at a premium over the maturity value of the underlying mortgages. This premium is not guaranteed and would be lost if prepayment occurs. Mortgage-backed securities issued by U.S. government agencies or instrumentalities other than GNMA are not "full faith and credit" obligations. Unscheduled or early payments on the underlying mortgages may shorten the securities' effective maturities and reduce returns. A Fund may agree to purchase or sell these securities with payment and delivery taking place at a future date. A decline in interest rates may lead to a faster rate of repayment of the underlying mortgages and expose a Fund to a lower rate of return upon reinvestment. To the extent that such mortgage-backed securities are held by a Fund, the prepayment right of mortgagors may limit the increase in NAV of the Fund because the value of the mortgage-backed securities held by the Fund may not appreciate as rapidly as the price of noncallable debt securities.

Interests in pools of mortgage-backed securities differ from other forms of debt securities, which normally provide for periodic payment of interest in fixed amounts with principal payments at maturity or specified call dates. Instead, these securities provide a monthly payment which consists of both interest and principal payments. In effect, these payments are a "pass-through" of the monthly payments made by the individual borrowers on their mortgage loans, net of any fees paid to the issuer or guarantor of such securities. Additional payments are caused by repayments of principal resulting from the sale of the underlying property, refinancing or foreclosure, net of fees or costs which may be incurred. Some mortgage-backed securities (such as securities issued by the GNMA) are described as "modified pass-through." These securities entitle the holder to receive all interest and principal payments owed on the mortgage pool, net of certain fees, at the scheduled payments dates regardless of whether or not the mortgagor actually makes the payment.

Mortgage-related securities that are issued or guaranteed by the U.S. government or any of its agencies or instrumentalities are not subject to the Funds' industry concentration restrictions, set forth above in the section "Investment Restrictions," by virtue of the exclusion from that test available to all U.S. government securities.

**Natural Disaster/Epidemic Risk**

Natural or environmental disasters, such as earthquakes, fires, floods, hurricanes, tsunamis and other severe weather-related phenomena generally, and widespread disease, including pandemics and epidemics, have been and can be highly disruptive to economies and markets, adversely impacting individual companies, sectors, industries, markets, currencies, interest and inflation rates, credit ratings, investor sentiment, and other factors affecting the value of the Funds' investments. Given the increasing interdependence among global economies and markets, conditions in one country, market, or region are increasingly likely to adversely affect markets, issuers, and/or foreign exchange rates in other countries, including the U.S. These disruptions could prevent the Funds from executing advantageous investment decisions in a timely manner and negatively impact the Funds' ability to achieve their investment objectives. Any such event(s) could have a significant adverse impact on the value and risk profile of the Funds.

***COVID-19***

Disease outbreaks that affect local economies or the global economy may materially and adversely impact the Funds and the Advisor's business. For example, uncertainties regarding the novel Coronavirus ("COVID-19") outbreak have resulted in serious economic disruptions across the globe. These types of outbreaks can be expected to cause severe decreases in core business activities such as manufacturing, purchasing, tourism, business conferences and workplace participation, among others. These disruptions lead to instability in the market place, including stock market losses and overall volatility, as has occurred in connection with COVID-19. In the face of such instability, governments may take extreme and unpredictable measures to combat the spread of disease and mitigate the resulting market disruptions and losses. The Advisor has in place a business continuity plan reasonably designed to ensure that it maintains normal business operations, and it periodically tests those plans. However, in the event of a pandemic or an outbreak, there can be no assurance that the Advisor's or the Funds' service providers will be able to maintain normal business operations for an extended period of time or will not lose the services of key personnel on a temporary or long-term basis due to illness or other reasons. Although vaccines for COVID-19 are available, the full impacts of a pandemic or disease outbreaks are unknown and the pace of recovery may vary from market to market, resulting in a high degree of uncertainty for potentially extended periods of time.

**Options**

The Funds may purchase and write call or put options on securities and indices and enter into related closing transactions.

All of the Funds may invest in options that are listed on exchanges or traded over the counter. Certain over-the-counter options may be illiquid. Thus, it may not be possible to close such options positions at the time or price desired, which may have an adverse impact on a Fund's investments in such options. Accordingly, a Fund will only invest in such options to the extent consistent with its limit on investments in illiquid investments.

***Call Options***

A purchaser (holder) of a call option pays a non-refundable premium to the seller (writer) of a call option to obtain the right to purchase a specified amount of an investment at a fixed price (the exercise price) during a specified period (exercise period). Conversely, the seller (writer) of a call option, upon payment by the holder of the premium, has the obligation to sell the investment to the holder of the call option at the exercise price during the exercise period. The Funds may both purchase and write call options.

The premium that a Fund pays when purchasing a call option or receives when writing a call option will reflect, among other things, the market price of the investment, the relationship of the exercise price to the market price of the investment, the relationship of the exercise price to the volatility of the investment, the length of the option period and supply and demand factors. The premium is the market value of an option.

*Purchasing Call Options*

The Funds may purchase call options. As a holder of a call option, a Fund has the right, but not the obligation, to purchase an investment at the exercise price during the exercise period. Instead of exercising the option and purchasing the investment, a Fund may choose to allow the option to expire or enter into a "closing sale transaction" with respect to the option. A closing sale transaction gives a Fund the opportunity to cancel out its position in a previously purchased option through the offsetting sale during the exercise period of an option having the same features. A Fund will realize a profit from a closing sale transaction if the cost of the transaction is more than the premium it paid to purchase the option. A Fund will realize a loss from the closing sale transaction if the cost of the transaction is less than the premium paid by the Fund. A Fund may purchase call options on investments that it intends to buy in order to limit the risk of a substantial change in the market price of the investment. A Fund may also purchase call options on investments held in its portfolio and on which it has written call options.

Although a Fund will generally purchase only those call options for which there appears to be an active secondary market, there is no assurance that a liquid secondary market on an exchange will exist for any particular option, or at any particular time, and for some options, no secondary market on an exchange may exist. In such event, it may not be possible to effect closing transactions in particular options, with the result being that a Fund would have to exercise its options in order to realize any profit and would incur brokerage commissions upon the exercise of such options and upon the subsequent disposition of the underlying investments acquired through the exercise of such options. Further, unless the price of the underlying investment changes sufficiently, a call option purchased by a Fund may expire without any value to the Fund, in which event the Fund would realize a capital loss which will be short-term unless the option was held for more than one year.

*Writing Call Options*

The Funds may write call options. As the writer of a call option, a Fund has the obligation to sell the security at the exercise price during the exercise period.

A call option is "covered" when a Fund either holds the security that is the subject of the option or possesses the option to purchase the same security at an exercise price equal to or less than the exercise price of the covered call option.

As the writer of a call option, in return for the premium, a Fund gives up the opportunity to realize a profit from a price increase in the underlying security above the exercise price and retains the risk of loss should the price of the security decline. If a call option written by a Fund is not exercised, the Fund will realize a gain in the amount of the premium. However, any gain may be offset by a decline in the market value of the security during the exercise period. If the option is exercised, the Fund will experience a profit or loss from the sale of the underlying security. A Fund may have no control over when the underlying securities must be sold because the Fund may be assigned an exercise notice at any time during the exercise period.

A Fund may choose to terminate its obligation as the writer of a call option by entering into a "closing purchase transaction." A closing purchase transaction allows a Fund to terminate its obligation to sell a security subject to a call option by allowing the Fund to cancel its position under a previously written call option through an offsetting purchase during the exercise period of an option having the same features. A Fund may not effect a closing purchase transaction once it has received notice that the option will be exercised. In addition, there is no guarantee that the Fund will be able to engage in a closing purchase transaction at a time or price desirable to the Fund. Effecting a closing purchase transaction on a call option permits a Fund to write another call option on the underlying security with a different exercise price, exercise date or both. If a Fund wants to sell a portfolio security that is subject to a call option, it will effect a closing purchase transaction prior to or at the same time as the sale of the security.

A Fund will realize a profit from a closing purchase transaction if the cost of the transaction is less than the premium received from writing the option. Conversely, a Fund will experience a loss from a closing purchase transaction if the cost of the transaction is more than the premium received from writing the option. Because increases in the market price of a call option will generally reflect increases in the market price of the underlying security, any loss resulting from the closing purchase transaction of a written call option is likely to be offset in whole or in part by appreciation of the underlying security owned by the Fund.

***Put Options***

A purchaser (holder) of a put option pays a non-refundable premium to the seller (writer) of a put option to obtain the right to sell a specified amount of a security at a fixed price (the exercise price) during a specified period (exercise period). Conversely, the writer of a put option, upon payment by the holder of the premium, has the obligation to buy the security from the holder of the put option at the exercise price during the exercise period. The Funds may both purchase and write put options.

*Purchasing Put Options*

As a holder of a put option, a Fund has the right, but not the obligation, to sell a security at the exercise price during the exercise period. Instead of exercising the option and selling the security, a Fund may choose to allow the option to expire or enter into a closing sale transaction with respect to the option. A closing sale transaction gives a Fund the opportunity to cancel out its position in a previously purchased option through the offsetting sale during the exercise period of an option having the same features.

A Fund may purchase put options on its portfolio securities for defensive purposes ("protective puts"). A Fund may purchase a protective put for a security it holds in its portfolio to protect against a possible decline in the value of the security subject to the put option. A Fund may also purchase a protective put for a security in its portfolio to protect the unrealized appreciation of the security without having to sell the security. By purchasing a put option, a Fund is able to sell the security subject to the put option at the exercise price during the exercise period even if the security has significantly declined in value.

A Fund may also purchase put options for securities it is not currently holding in its portfolio. A Fund would purchase a put option on a security it does not own in order to benefit from a decline in the market price of the security during the exercise period. A Fund will only make a profit by exercising a put option if the market price of the security subject to the put option plus the premium and the transaction costs paid by the Fund together total less than the exercise price of the put option.

*Writing Put Options*

As the writer of a put option, a Fund has the obligation to buy the underlying security at the exercise price during the exercise period.

The Fund is required to comply with Rule 18f-4 under the 1940 Act. See the section entitled "Forward Foreign Currency Transactions" above for additional information.

If a put option written by a Fund is not exercised, the Fund will realize a gain in the amount of the premium. If the put option is exercised, the Fund must fulfill the obligation to purchase the underlying security at the exercise price, which will usually exceed the market value of the underlying security at that time. A Fund may have no control over when the underlying securities must be purchased because the Fund may be assigned an exercise notice at any time during the exercise period.

A Fund may choose to terminate its obligation as the writer of a put option by entering into a "closing purchase transaction." A closing purchase transaction allows a Fund to terminate its obligation to purchase a security subject to a put option by allowing the Fund to cancel its position under a previously written put option through an offsetting purchase during the exercise period of an option having the same features. A Fund may not effect a closing purchase transaction once it has received notice that the option will be exercised. In addition, there is no guarantee that a Fund will be able to engage in a closing purchase transaction at a time or price desirable to the Fund. Effecting a closing purchase transaction on a put option permits the Fund to write another put option.

A Fund will realize a profit from a closing purchase transaction if the cost of the transaction is less than the premium received from writing the option. Conversely, a Fund will experience a loss from a closing purchase transaction if the cost of the transaction is more than the premium received from writing the option.

A Fund may write put options in situations when the Advisor wants to buy the underlying security for the Fund's portfolio at a price lower than the current market price of the security. To effect this strategy, a Fund would write a put option at an exercise price that, reduced by the premium received on the option, reflects the lower price the Fund is willing to pay. Since the Fund may also receive interest on debt securities or currencies maintained to cover the exercise price of the option, this technique could be used to enhance current return during periods of market uncertainty. The risk of this strategy is that the market price of the underlying security would decline below the exercise price less the premiums received.

**Options on Foreign Currencies**

The Funds may buy and write options on foreign currencies in a manner similar to that in which futures or forward contracts on foreign currencies will be used. In addition, options on foreign currencies may be used to hedge against adverse changes in foreign currency conversion rates. For example, a decline in the U.S. dollar value of a foreign currency in which portfolio securities are denominated will reduce the U.S. dollar value of such securities, even if their value in the foreign currency remains constant. In order to protect against such diminutions in the value of the portfolio securities, a Fund may buy put options on the foreign currency. If the value of the currency declines, a Fund will have the right to sell such currency for a fixed amount in U.S. dollars, thereby offsetting, in whole or in part, the adverse effect on its portfolio.

Conversely, when a rise in the U.S. dollar value of a currency in which securities to be acquired are denominated is projected, thereby increasing the cost of such securities, a Fund may buy call options on the foreign currency. The purchase of such options could offset, at least partially, the effects of the adverse movements in exchange rates. As in the case of other types of options, however, the benefit to a Fund from purchases of foreign currency options will be reduced by the amount of the premium and related transaction costs. In addition, if currency exchange rates do not move in the direction or to the extent desired, a Fund could sustain losses on transactions in foreign currency options that would require a Fund to forego a portion or all of the benefits of advantageous changes in those rates.

The Funds also may write options on foreign currencies. For example, to hedge against a potential decline in the U.S. dollar due to adverse fluctuations in exchange rates, a Fund could, instead of purchasing a put option, write a call option on the relevant currency. If the decline expected by a Fund occurs, the option will most likely not be exercised and the diminution in value of portfolio securities will be offset at least in part by the amount of the premium received. Similarly, instead of purchasing a call option to hedge against a potential increase in the U.S. dollar cost of securities to be acquired, a Fund could write a put option on the relevant currency which, if rates move in the manner projected by a Fund, will expire unexercised and allow a Fund to hedge the increased cost up to the amount of the premium. If exchange rates do not move in the expected direction, the option may be exercised and a Fund would be required to buy or sell the underlying currency at a loss, which may not be fully offset by the amount of the premium. Through the writing of options on foreign currencies, a Fund also may lose all or a portion of the benefits that might otherwise have been obtained from favorable movements in exchange rates.

**Options on Indices**

The Funds may invest in options on indices. Put and call options on indices are similar to puts and calls on securities or futures contracts except that all settlements are in cash and gain or loss depends on changes in the index in question rather than on price movements in individual securities or futures contracts. When a Fund writes a call on an index, it receives a premium and agrees that, prior to the expiration date, the purchaser of the call, upon exercise of the call, will receive from a Fund an amount of cash if the closing level of the index upon which the call is based is greater than the exercise price of the call. The amount of cash is equal to the difference between the closing price of the index and the exercise price of the call times a specified multiple ("multiplier"), which determines the total dollar value for each point of such difference. When a Fund buys a call on an index, it pays a premium and has the same rights as to such call as are indicated above. When a Fund buys a put on an index, it pays a premium and has the right, prior to the expiration date, to require the seller of the put, upon a Fund's exercise of the put, to deliver to a Fund an amount of cash equal to the difference between the exercise price of the option and the value of the index, times a multiplier, similar to that described above for calls. When a Fund writes a put on an index, it receives a premium and the purchaser of the put has the right, prior to the expiration date, to require a Fund to deliver to it an amount of cash equal to the difference between the closing level of the index and exercise price times the multiplier if the closing level is less than the exercise price.

Because the value of an index option depends upon movements in the level of the index rather than the price of a particular security, whether a Fund will realize gain or loss on the purchase of an option on an index depends upon movements in the level of prices in the market generally or in an industry or market segment rather than movements in the price of a particular security. Accordingly, successful use by a Fund of options on indices is subject to the Advisor's ability to predict correctly the direction of movements in the market generally or in a particular industry. This requires different skills and techniques than predicting changes in the prices of individual securities.

Index prices may be distorted if trading of a substantial number of securities included in the index is interrupted causing the trading of options on that index to be halted. If a trading halt occurred, a Fund would not be able to close out options which it had purchased and the Fund may incur losses if the underlying index moved adversely before trading resumed. If a trading halt occurred and restrictions prohibiting the exercise of options were imposed through the close of trading on the last day before expiration, exercises on that day would be settled on the basis of a closing index value that may not reflect current price information for securities representing a substantial portion of the value of the index.

If a Fund holds an index option and exercises it before final determination of the closing index value for that day, it runs the risk that the level of the underlying index may change before closing. If such a change causes the exercised option to fall "out-of-the-money," the Fund will be required to pay the difference between the closing index value and the exercise price of the option (times the applicable multiplier) to the assigned writer. Although a Fund may be able to minimize this risk by withholding exercise instructions until just before the daily cutoff time or by selling rather than exercising the option when the index level is close to the exercise price, it may not be possible to eliminate this risk entirely because the cutoff times for index options may be earlier than those fixed for other types of options and may occur before definitive closing index values are announced.

**Over-The-Counter ("OTC") Options**

The Funds may write covered put and call options and buy put and call options that trade in the OTC market to the same extent that it may engage in exchange traded options. OTC options differ from exchange traded options in certain material respects. OTC options are arranged directly with dealers and not with a clearing corporation. Thus, there is a risk of non-performance by the dealer. Because there is no exchange, pricing is typically done based on information from market makers. OTC options are available for a greater variety of securities and in a wider range of expiration dates and exercise prices, however, than exchange traded options and the writer of an OTC option is paid the premium in advance by the dealer. There can be no assurance that a continuous liquid secondary market will exist for any particular OTC option at any specific time. A Fund may be able to realize the value of an OTC option it has purchased only by exercising it or entering into a closing sale transaction with the dealer that issued it. A Fund may suffer a loss if it is not able to exercise or sell its position on a timely basis. When a Fund writes an OTC option, it generally can close out that option prior to its expiration only by entering into a closing purchase transaction with the dealer with which the Fund originally wrote the option.

**Private Placements**

A Fund may invest in securities that are purchased in private placements, which are subject to restrictions on resale as a matter of contract or under federal securities laws. Because there may be relatively few potential purchasers for these securities, especially under adverse market or economic conditions or in the event of adverse changes in the financial condition of the issuer, a Fund could find it more difficult to sell the securities when the Advisor believes that it is advisable to do so, or may be able to sell the securities only at prices lower than if the securities were more widely held. At times, it also may be more difficult to determine the fair value of the securities for purposes of computing a Fund's NAV.

While private placements may offer opportunities for investment that are not otherwise available on the open market, the securities so purchased are often "restricted securities" that cannot be sold to the public without registration under the 1933 Act, the availability of an exemption from registration (such as Rule 144 or Rule 144A under the 1933 Act) or that are not readily marketable because they are subject to other legal or contractual delays or restrictions on resale.

The absence of a trading market can make it difficult to ascertain a market value for illiquid investments such as private placements. Disposing of illiquid investments may involve time-consuming negotiation and legal expenses, and it may be difficult or impossible for a Fund to sell the illiquid securities promptly at an acceptable price. A Fund may have to bear the extra expense of registering the securities for resale and the risk of substantial delay in effecting the registration. In addition, market quotations are typically less readily available for these securities. The judgment of the Advisor may at times play a greater role in valuing these securities than in the case of unrestricted securities.

Generally, restricted securities may be sold only to qualified institutional buyers, in a privately negotiated transaction to a limited number of purchasers, in limited quantities after they have been held for a specified period of time and when other conditions are met pursuant to an exemption from registration, or in a public offering for which a registration statement is in effect under the 1933 Act. A Fund may be deemed to be an underwriter for purposes of the 1933 Act when selling restricted securities to the public. As such, a Fund may be liable to purchasers of the securities if the registration statement prepared by the issuer, or the prospectus forming a part of the registration statement, is materially inaccurate or misleading.

**REITs**

The Penn Capital Mid Cap Core Fund and the Penn Capital Special Situations Small Cap Equity Fund may invest in equity REITs and equity interests issued by REITs; the Penn Capital Floating Rate Income Fund, the Penn Capital Short Duration High Income Fund and the Penn Capital Opportunistic High Income Fund may invest in debt obligations issued by REITs. REITs are pooled investment vehicles that invest primarily in income-producing real estate or real estate-related loans or interests. REITs are generally classified as equity REITs, mortgage REITs or a combination of equity and mortgage REITs. Equity REITs invest the majority of their assets directly in real property and derive income primarily from the collection of rents. Equity REITs can also realize capital gains by selling properties that have appreciated in value. Mortgage REITs invest the majority of their assets in real estate mortgages and derive income from the collection of interest payments. REITs are not taxed on income distributed to shareholders provided they comply with the applicable requirements of the Internal Revenue Code of 1986, as amended (the "Code"). A Fund will indirectly bear its proportionate share of any management and other expenses paid by REITs in which it invests in addition to the expenses paid by the Fund. Debt securities issued by REITs are, for the most part, general and unsecured obligations and are subject to risks associated with REITs.

Investing in REITs involves certain unique risks in addition to those risks associated with investing in the real estate industry in general. An equity REIT may be affected by changes in the value of the underlying properties owned by the REIT. A mortgage REIT may be affected by changes in interest rates and the ability of the issuers of its portfolio mortgages to repay their obligations in addition to the fact that a mortgage REIT that is in its liquidation stage may return capital to investors when it is disadvantageous to do so. In addition, with respect to investments in mortgage REITs that create exposure to mortgage pools that include subprime mortgages (which refer to loans made to borrowers with weakened credit histories or with a lower capacity to make timely payments, and second-lien mortgage loans), the risk of default is generally higher, and a decline in or flattening of property values also may exacerbate losses. REITs are dependent upon the skills of their managers and are not diversified. REITs are generally dependent upon maintaining cash flows to repay borrowings and to make distributions to shareholders and are subject to the risk of default by lessees or borrowers. REITs whose underlying assets are concentrated in properties used by a particular industry, such as health care, are also subject to risks associated with such industry. In addition, REITS are subject to the possibilities of failing to qualify for tax-free pass-through of income under the Code, and failing to maintain their exemptions from registration under the 1940 Act.

REITs (especially mortgage REITs) are also subject to interest rate risks, including prepayment risk. When interest rates decline, the value of a REIT's investment in fixed rate obligations can be expected to rise. Conversely, when interest rates rise, the value of a REIT's investment in fixed rate obligations can be expected to decline. If the REIT invests in adjustable rate mortgage loans the interest rates on which are reset periodically, yields on a REIT's investments in such loans will gradually align themselves to reflect changes in market interest rates. This causes the value of such investments to fluctuate less dramatically in response to interest rate fluctuations than would investments in fixed rate obligations.

REITs may have limited financial resources, may trade less frequently and in a more limited volume and may be subject to more abrupt or erratic price movements than more widely held securities.

A Fund's investment in a REIT may require the Fund to accrue and distribute income not yet received or may result in a Fund making distributions that constitute a return of capital to Fund shareholders for federal income tax purposes. In addition, distributions by a Fund from REITs will not qualify for the corporate dividends-received deduction, or, generally, for treatment as qualified dividend income.

**Repurchase and Reverse Repurchase Agreements**

Under a repurchase agreement, a Fund agrees to buy securities guaranteed as to payment of principal and interest by the U.S. government or its agencies from a qualified bank or broker-dealer and then to sell the securities back to the bank or broker-dealer after a short period of time (generally, less than seven days) at a higher price. The bank or broker-dealer must transfer to a Fund's custodian securities with an initial market value of at least 100% of the dollar amount invested by a Fund in each repurchase agreement. The Advisor will monitor the value of such securities daily to determine that the value equals or exceeds the repurchase price.

Repurchase agreements may involve risks in the event of default or insolvency of the bank or broker-dealer, including possible delays or restrictions upon a Fund's ability to sell the underlying securities. A Fund will enter into repurchase agreements only with parties who meet certain creditworthiness standards, *i.e.*, banks or broker-dealers that the Advisor has determined present no serious risk of becoming involved in bankruptcy proceedings within the time frame contemplated by the repurchase transaction.

The Funds may also each enter into reverse repurchase agreements. Under a reverse repurchase agreement, a Fund agrees to sell a security in its portfolio and then to repurchase the security at an agreed-upon price, date and interest payment. When entering into reverse repurchase agreements, the Fund is required to comply with Rule 18f-4 under the 1940 Act. See the section entitled "Foreign Currency Transactions" above for additional information.

The use of repurchase agreements by a Fund involves certain risks. For example, if the other party to a repurchase agreement defaults on its obligation to repurchase the underlying security at a time when the value of the security has declined, a Fund may incur a loss upon disposition of the security. If the other party to the agreement becomes insolvent and subject to liquidation or reorganization under the bankruptcy code or other laws, a court may determine that the underlying security is collateral for the loan by a Fund not within the control of that Fund, and therefore the realization by a Fund on the collateral may be automatically stayed. Finally, it is possible that a Fund may not be able to substantiate its interest in the underlying security and may be deemed an unsecured creditor of the other party to the agreement. While the Advisor acknowledges these risks, it is expected that if repurchase agreements are otherwise deemed useful to a Fund, these risks can be controlled through careful monitoring procedures.

**Restricted and Illiquid Investments**

Pursuant to Rule 22e-4 under the 1940 Act, each of the Funds may invest up to 15% of its net assets in illiquid investments. An illiquid investment as defined in Rule 22e-4 is an investment that a Fund reasonably expects cannot be sold or disposed of in current market conditions within 7 calendar days or less without the sale or disposition significantly changing the market value of the investment. These investments may include restricted securities and repurchase agreements maturing in more than 7 days. Restricted securities are securities that may not be sold to the public without an effective registration statement under the 1933 Act, and thus may be sold only in privately negotiated transactions or pursuant to an exemption from registration. Subject to the adoption of guidelines by the Board, certain restricted securities that may be sold to institutional investors pursuant to Rule 144A under the 1933 Act and non-exempt commercial paper may be determined to be liquid by the Advisor. Illiquid investments involve the risk that the investments will not be able to be sold at the time the Advisor desires or at prices approximating the value at which a Fund is carrying the investments. To the extent an investment held by a Fund is deemed to be an illiquid investment or a less liquid investment, the Fund will be exposed to a greater liquidity risk.

The Company has implemented a liquidity risk management program and related procedures to identify illiquid investments pursuant to Rule 22e-4. If the limitation on illiquid securities is exceeded, other than by a change in market values, the condition will be reported to the Board and, when required by the Liquidity Rule, to the SEC.

There are no restrictions on a Fund's ability to invest in restricted securities (that is, securities that are not registered pursuant to the 1933 Act), except to the extent such securities may be considered illiquid. Securities issued pursuant to Rule 144A of the 1933 Act will be considered liquid if determined to be so under procedures adopted by the Board pursuant to Rule 22e-4 under the 1940 Act.

**Step-Coupon Securities**

Step-coupon securities trade at a discount from their face value and pay coupon interest. The coupon rate is low for an initial period and then increases to a higher coupon rate thereafter. Market values of these types of securities generally fluctuate in response to changes in interest rates to a greater degree than conventional interest-paying securities of comparable term and quality. Under many market conditions, investments in such securities may be illiquid, making it difficult for a Fund to dispose of them or determine their current value.

**Structured Notes**

Structured notes are derivative debt securities, the interest rate and/or principal of which is determined by an unrelated indicator. The value of the principal of and/or interest on structured notes is determined by reference to changes in the return, interest rate or value at maturity of a specific asset, reference rate or index (the "reference instrument") or the relative change in two or more reference instruments. The interest rate or the principal amount payable upon maturity or redemption may be increased or decreased, depending upon changes in the applicable reference instruments. Structured notes may be positively or negatively indexed, so that an increase in value of the reference instrument may produce an increase or a decrease in the interest rate or value of the structured note at maturity. In addition, changes in the interest rate or the value of the structured note at maturity may be calculated as a specified multiple of the change in the value of the reference investment; therefore, the value of such note may be very volatile. Structured notes may entail a greater degree of market risk than other types of debt securities because the investor bears the risk of the reference instrument. Structured notes may also be more volatile, less liquid and more difficult to accurately price than less complex securities or more traditional debt securities. In connection with its investments in structured notes, a Fund is required to comply with Rule 18f-4 under the 1940 Act. See the section entitled "Foreign Currency Transactions" above for additional information.

**Supranational Entities**

The Funds may invest in obligations of supranational entities. A supranational entity is an entity designated or supported by national governments to promote economic reconstruction, development or trade amongst nations. Examples of supranational entities include the International Bank for Reconstruction and Development (also known as the World Bank) and the European Investment Bank. Obligations of supranational entities are subject to the risk that the governments on whose support the entity depends for its financial backing or repayment may be unable or unwilling to provide that support. Obligations of a supranational entity that are denominated in foreign currencies will also be subject to the risks associated with investments in foreign currencies, as described above in the section "Foreign Currency Transactions."

**Swaps–Interest Rate Swaps, Mortgage Swaps, Credit Swaps, Currency Swaps, Total Return Swaps, Options on Swaps and Interest Rate Caps, Floors and Collars, Inflation Indexed Swaps**

The Funds may enter into interest rate, mortgage, credit, currency and total return swaps, as well as interest rate caps, floors and collars. The Funds may also purchase and write (sell) options contracts on swaps, referred to as "swaptions." Generally, swap agreements are contracts between a Fund and another party (the swap counterparty) involving the exchange of payments on specified terms over periods ranging from a few days to multiple years. A swap agreement may be negotiated bilaterally and traded OTC between the two parties (for an uncleared swap) or, in some instances, must be transacted through an FCM and cleared through a clearinghouse that serves as a central counterparty (for a cleared swap). In a basic swap transaction, a Fund agrees with the swap counterparty to exchange the returns (or differentials in rates of return) and/or cash flows earned or realized on a particular "notional amount" or value of predetermined underlying reference instruments. The notional amount is the set dollar or other value selected by the parties to use as the basis on which to calculate the obligations that the parties to a swap agreement have agreed to exchange. The parties typically do not actually exchange the notional amount. Instead they agree to exchange the returns that would be earned or realized if the notional amount were invested in given investments or at given rates. An inflation index swap is a contract between two parties, whereby one party makes payments based on the cumulative percentage increase in an index that serves as a measure of inflation (typically, the Consumer Price Index) and the other party makes a regular payment based on a compounded fixed rate. Typically, an inflation index swap has payment obligations netted and exchanged upon maturity. The value of an inflation index swap is expected to change in response to changes in the rate of inflation. If inflation increases at a faster rate than anticipated at the time the swap is entered into, the swap will increase in value. Similarly, if inflation increases at a rate slower than anticipated at the time the swap is entered into, the swap will decrease in value.

The Funds may enter into swap transactions for hedging purposes or to seek to increase total return. Interest rate swaps involve the exchange by a Fund with another party of their respective commitments to pay or receive interest, such as an exchange of fixed-rate payments for floating rate payments. Mortgage swaps are similar to interest rate swaps in that they represent commitments to pay and receive interest. The notional principal amount, however, is tied to a reference pool or pools of mortgages. Credit swaps involve the receipt of floating or fixed rate payments in exchange for assuming potential credit losses of an underlying security. Credit swaps give one party to a transaction the right to dispose of or acquire an asset (or group of assets), or the right to receive or make a payment from the other party, upon the occurrence of specified credit events. Currency swaps involve the exchange of the parties' respective rights to make or receive payments in specified currencies. Total return swaps are contracts that obligate a party to pay or receive interest in exchange for payment by the other party of the total return generated by a security, a basket of securities, an index, or an index component. A swaption is an option to enter into a swap agreement. Like other types of options, the buyer of a swaption pays a non-refundable premium for the option and obtains the right, but not the obligation, to enter into an underlying swap on agreed-upon terms. The seller of a swaption, in exchange for the premium, becomes obligated (if the option is exercised) to enter into an underlying swap on agreed-upon terms. The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index exceeds a predetermined interest rate, to receive payment of interest on a notional principal amount from the party selling such interest rate cap. The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls below a predetermined interest rate, to receive payments of interest on a notional principal amount from the party selling the interest rate floor. An interest rate collar is the combination of a cap and a floor that preserves a certain return within a predetermined range of interest rates.

A great deal of flexibility is possible in the way swap transactions are structured. The Funds will generally enter into swap agreements on a net basis, which means that the two payment streams that are to be made by a Fund and its counterparty with respect to a particular swap agreement are netted out, with the Fund receiving or paying, as the case may be, only the net difference in the two payments. Accordingly, the risk of loss with respect to interest rate and mortgage swaps is normally limited to the net amount of payments that a Fund is contractually obligated to make. If the other party to an interest rate swap defaults, a Fund's risk of loss consists of the net amount of payments that the Fund is contractually entitled to receive, if any. In contrast, currency swaps usually involve the delivery of the entire principal amount of one designated currency in exchange for the other designated currency. Therefore, the entire principal value of a currency swap is subject to the risk that the other party to the swap will default on its contractual delivery obligations.

In an uncleared swap, the swap counterparty is typically a brokerage firm, bank or other financial institution. During the term of an uncleared swap, a Fund is usually required to pledge to the swap counterparty, from time to time, an amount of cash and/or other assets equal to the total net amount (if any) that would be payable by the Fund to the counterparty if the swap were terminated on the date in question, including any early termination payments. Periodically, changes in the amount pledged are made to recognize changes in value of the contract. Likewise, the counterparty may be required to pledge cash or other assets to cover its obligations to the Fund. However, the amount pledged may not always be equal to or more than the amount due to the other party. Therefore, if a counterparty defaults in its obligations to a Fund, the amount pledged by the counterparty and available to the Fund may not be sufficient to cover all the amounts due to the Fund and the Fund may sustain a loss.

Currently, a Fund does not typically provide initial margin in connection with uncleared swaps. Rules requiring both initial and variation margin to be posted by certain market participants for uncleared swaps have been adopted, and will become effective as to various market participants over time. When these rules take effect, a Fund may be required to post both initial margin and variation margin.

Certain standardized swaps are subject to mandatory central clearing and exchange-trading. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and implementing rules will ultimately require the clearing and exchange-trading of many swaps. Mandatory exchange-trading and clearing will occur on a phased-in basis based on the type of market participant, CFTC approval of contracts for central clearing and public trading facilities making such cleared swaps available to trade. To date, the CFTC has designated only certain of the most common types of credit default index swaps and interest rate swaps as subject to mandatory clearing and certain public trading facilities have made certain of those cleared swaps available to trade, but it is expected that additional categories of swaps will in the future be designated as subject to mandatory clearing and trade execution requirements.

In a cleared swap, a Fund's ultimate counterparty is a central clearinghouse rather than a brokerage firm, bank or other financial institution. Cleared swaps are submitted for clearing through each party's FCM, which must be a member of the clearinghouse that serves as the central counterparty. Transactions executed on a swap execution facility ("SEF") may increase market transparency and liquidity but may require a Fund to incur increased expenses to access the same types of swaps that it has used in the past. When a Fund enters into a cleared swap, it must deliver to the central counterparty (via the FCM) an amount referred to as "initial margin." During the term of the swap agreement, a "variation margin" amount may also be required to be paid by the Fund or may be received by the Fund in accordance with margin controls set for such accounts, depending upon changes in the marked-to-market value of the swap agreement. If the value of a Fund's cleared swap declines, the Fund will be required to make additional "variation margin" payments to the FCM to settle the change in value. Conversely, if the market value of a Fund's position increases, the FCM will post additional "variation margin" to the Fund's account.

The use of swap transactions is a highly specialized activity, which involves investment techniques and risks different from those associated with ordinary portfolio securities transactions. If the Advisor, in using swap agreements, is incorrect in its forecasts of market values, interest rates, inflation, currency exchange rates or other applicable factors, the investment performance of a Fund will be less than its performance would have been if it had not used the swap agreements.

In an uncleared swap, performance is the responsibility only of the swap counterparty and not of any exchange or clearinghouse. As a result, a Fund is subject to the risk that a counterparty will be unable or will refuse to perform under such agreement, including because of the counterparty's bankruptcy or insolvency. A Fund risks the loss of the accrued but unpaid amounts under a swap agreement, which could be substantial, in the event of a default, insolvency or bankruptcy by a swap counterparty. In such an event, a Fund will have contractual remedies pursuant to the swap agreements, but bankruptcy and insolvency laws could affect the Fund's rights as a creditor. If the counterparty's creditworthiness declines, the value of a swap agreement would likely decline, potentially resulting in losses.

Central clearing is designed to reduce counterparty credit risk and increase liquidity compared to uncleared swaps because central clearing interposes the central clearinghouse as the counterparty to each participant's swap, but it does not eliminate those risks completely and may involve additional costs and risks not involved with uncleared swaps. There is also a risk of loss by a Fund of the initial and variation margin deposits in the event of bankruptcy of the FCM with which the Fund has an open position, or the central counterparty in a swap contract. The assets of a Fund may not be fully protected in the event of the bankruptcy of the FCM or central counterparty because the Fund might be limited to recovering only a pro rata share of all available funds and margin segregated on behalf of an FCM's customers. If the FCM does not provide accurate reporting, a Fund is also subject to the risk that the FCM could use the Fund's assets, which are held in an omnibus account with assets belonging to the FCM's other customers, to satisfy its own financial obligations or the payment obligations of another customer to the central counterparty. Finally, a Fund is subject to the risk that, after entering into a cleared swap with an executing broker, no FCM or central counterparty is willing or able to clear the transaction. In such an event, the Fund may be required to break the trade and make an early termination payment to the executing broker. Credit risk of cleared swap participants is concentrated in a few clearinghouses, and the consequences of insolvency of a clearinghouse are not clear.

The Funds may invest in publicly or privately issued interests in investment pools whose underlying assets are credit default, credit-linked, interest rate, currency exchange, equity-linked or other types of swap contracts and related underlying securities or securities loan agreements. The pools' investment results may be designed to correspond generally to the performance of a specified securities index or "basket" of securities, or sometimes a single security. These types of pools may be used by a Fund to gain exposure to multiple securities with a smaller investment than would be required to invest directly in the individual securities. They also may be used by a Fund to gain exposure to foreign securities markets without investing in the foreign securities themselves and/or the relevant foreign market. To the extent that a Fund invests in pools of swaps and related underlying securities or securities loan agreements whose return corresponds to the performance of a foreign securities index or one or more foreign securities, investing in such pools will involve risks similar to the risks of investing in foreign securities. See the section "Foreign Securities" above. In addition to the risks associated with investing in swaps generally, a Fund bears the risks and costs generally associated with investing in pooled investment vehicles, such as paying the fees and expenses of the pool and the risk that the pool or the operator of the pool may default on its obligations to the holder of interests in the pool, such as a Fund. Interests in privately offered investment pools of swaps may be considered illiquid.

The regulation of cleared and uncleared swaps, as well as other derivatives, is a rapidly changing area of law and is subject to modification by government and judicial action. In addition, the SEC, CFTC and the exchanges are authorized to take extraordinary actions in the event of a market emergency, including, for example, the implementation or reduction of speculative position limits, the implementation of higher margin requirements, the establishment of daily price limits and the suspension of trading.

It is not possible to predict fully the effects of current or future regulation. However, it is possible that developments in government regulation of various types of derivative instruments, such as speculative position limits on certain types of derivatives, or limits or restrictions on the counterparties with which a Fund engages in derivative transactions, may limit or prevent the Fund from using or limit the Fund's use of these instruments effectively as a part of its investment strategy, and could adversely affect the Fund's ability to achieve its investment objective.

**Synthetic Securities**

Incidental to other transactions in fixed income securities and/or for investment purposes, a Fund also may combine options on securities with cash, cash equivalent investments or other fixed income securities in order to create "synthetic" securities that approximate desired risk and return profiles. This may be done where a "non-synthetic" security having the desired risk/return profile either is unavailable (*e.g.*, short-term securities of certain non-U.S. governments) or possesses undesirable characteristics (*e.g.*, interest payments on the security would be subject to non-U.S. withholding taxes). A Fund also may purchase forward non-U.S. exchange contracts in conjunction with U.S. dollar-denominated securities in order to create a synthetic non-U.S. currency denominated security that approximates desired risk and return characteristics where the non-synthetic securities either are not available in non-U.S. markets or possess undesirable characteristics. The use of synthetic bonds and other synthetic securities may involve risks different from, or potentially greater than, risks associated with direct investments in securities and other assets including market risk, liquidity risk, and credit risk, and their value may or may not correlate with the value of the relevant underlying asset.

**Temporary Investments**

Under normal circumstances, a Fund may have money received from the purchase of Fund shares, or money received on the sale of its portfolio securities for which suitable investments consistent with such Fund's investment objective(s) are not immediately available. Under these circumstances, a Fund may have such monies invested in cash or cash equivalents in order to earn income on this portion of its assets. Cash equivalents include money market mutual funds and money market deposit accounts, as well as investments such as U.S. government obligations, repurchase agreements, bank obligations, commercial paper and corporate bonds with remaining maturities of thirteen months or less. A Fund may also have a portion of its assets invested in cash equivalents in order to meet anticipated redemption requests or if other suitable securities are unavailable. In addition, a Fund may reduce its holdings in equity and other securities and may invest in cash, cash equivalents or other high quality short-term investments for temporary defensive purposes, during periods in which the Advisor believes changes in economic, financial, political or other conditions make it advisable.

Bank obligations include bankers' acceptances, negotiable certificates of deposit and non-negotiable time deposits, including U.S. dollar-denominated instruments issued or supported by the credit of U.S. or foreign banks or savings institutions. Although each of the Funds may invest in money market obligations of foreign banks or foreign branches of U.S. banks only where the Advisor determines the instrument to present minimal credit risks, such investments may nevertheless entail risks that are different from those of investments in domestic obligations of U.S. banks due to differences in political, regulatory and economic systems and conditions. All investments in bank obligations are limited to the obligations of financial institutions having more than $1 billion in total assets at the time of purchase, and investments by a Fund in the obligations of foreign banks and foreign branches of U.S. banks will not exceed 10% of a Fund's total assets at the time of purchase. A Fund may also make interest-bearing savings deposits in commercial and savings banks in amounts not in excess of 10% of its net assets.

Investments by a Fund in commercial paper will consist of issues rated at the time of investment as A-1 and/or P-1 by S&P<sup>®</sup>, Moody's or a similar rating by another NRSRO. In addition, a Fund may acquire unrated commercial paper and corporate bonds that are determined by the Advisor at the time of purchase to be of comparable quality to rated instruments that may be acquired by such Fund, as previously described.

**Trust Preferred Securities**

The Funds may also purchase trust preferred securities, which have characteristics of both subordinated debt and preferred stock. Trust preferred securities are issued by a special purpose trust subsidiary backed by subordinated debt of a corporate parent. These securities generally have a final stated maturity date and a fixed schedule for periodic payments. In addition, these securities have provisions that afford preference over common and preferred stock upon liquidation, although the securities are subordinated to other, more senior debt securities of the same issuer. The issuers of these securities often have the right to defer interest payments for a period of time.

Holders of trust preferred securities have limited voting rights to control the activities of the trust, and no voting rights with respect to the parent company. The market value of trust preferred securities may be more volatile than those of conventional debt securities. Trust preferred securities may be issued in reliance on Rule 144A under the 1933 Act or otherwise subject to restrictions on resale. There can be no assurance as to the liquidity of trust preferred securities and the ability of holders, such as a Fund, to sell their holdings. If the parent company defaults on interest payments to the trust, the trust will not be able to make dividend payments to holders of its securities.

**U.S. Government Obligations**

A Fund may invest in a variety of U.S. Treasury obligations including bonds, notes and bills, which mainly differ only in their interest rates, maturities and time of issuance. The Funds may also each invest in other securities issued or guaranteed by the U.S. government, its agencies and instrumentalities, such as obligations of Federal Home Loan Banks, Federal Farm Credit Banks, Federal Land Banks, the Federal Housing Administration, Farmers Home Administration, Export-Import Bank of the United States, Small Business Administration, GNMA, Fannie Mae<sup>®</sup>, General Services Administration, Central Bank for Cooperatives, Federal Home Loan Mortgage Corporation, Federal Intermediate Credit Banks, Maritime Administration and Resolution Trust Corp. Government agency obligations have different levels of credit support and, therefore, different degrees of credit risk. Securities issued by agencies and instrumentalities of the U.S. government that are supported by the full faith and credit of the United States, such as the Federal Housing Administration and Ginnie Mae<sup>®</sup>, present little credit risk. Government agency obligations also include instruments issued by certain instrumentalities established or sponsored by the U.S. government, including the Federal Home Loan Banks, Fannie Mae<sup>®</sup>, and the Federal Home Loan Mortgage Corporation (''FHLMC'' or "Freddie Mac<sup>®"</sup>). Although these securities are issued, in general, under the authority of an Act of Congress, the U.S. government is not obligated to provide financial support to the issuing instrumentalities and these securities are neither insured nor guaranteed by the U.S. government. The U.S. Department of the Treasury has the authority to support FNMA and FHLMC by purchasing limited amounts of their respective obligations. In addition, the U.S. government has, in the past, provided financial support to FNMA and FHLMC with respect to their debt obligations. However, no assurance can be given that the U.S. government will always do so or would do so yet again.

**Variable and Floating Rate Instruments**

The Funds may purchase variable- and floating-rate instruments (including bank loans, which are discussed in the section "Bank Loans, Loan Participations and Assignments" above). These instruments may include variable amount master demand notes that permit the indebtedness thereunder to vary in addition to providing for periodic adjustments in the interest rate. These instruments may also include leveraged inverse floating-rate debt instruments, or "inverse floaters." The interest rate of an inverse floater resets in the opposite direction from the market rate of interest on a security or interest to which it is related. An inverse floater may be considered to be leveraged to the extent that its interest rate varies by a magnitude that exceeds the magnitude of the change in the index rate of interest, and is subject to many of the same risks as derivatives. The higher degree of leverage inherent in inverse floaters is associated with greater volatility in their market values. Certain of these investments may be illiquid. The absence of an active secondary market with respect to these investments could make it difficult for a Fund to dispose of a variable or floating rate note if the issuer defaulted on its payment obligation or during periods that a Fund is not entitled to exercise its demand rights, and a Fund could, for these or other reasons, suffer a loss with respect to such instruments.

**Warrants**

A Fund has the ability to purchase warrants and similar rights, which are privileges issued by corporations enabling the owners to subscribe to and purchase a specified number of shares of the corporation at the specified price during a specified period of time. Warrants do not represent ownership of the securities, but only the right to buy them. Warrants have no voting rights, pay no dividends and have no rights with respect to the assets of the company issuing them. Warrants differ from call options in that warrants are issued by the issuer of the security that may be purchased on their exercise, whereas call options may be written or issued by anyone. The prices of warrants do not necessarily move parallel to the prices of the underlying securities.

The purchase of warrants involves the risk that a Fund could lose the purchase value of a warrant if the right to subscribe to additional shares is not exercised prior to the warrant's expiration. Also, the purchase of warrants involves the risk that the effective price paid for the warrant added to the subscription price of the related security may exceed the value of the subscribed security's market price, such as when there is no movement in the level of the underlying security. Under normal circumstances, no more than 5% of a Fund's net assets will be invested in warrants. This 5% limit includes warrants that are not listed on any stock exchange. Warrants acquired by a Fund in units or attached to securities are not subject to these limits.

**When-Issued Purchases, Delayed Delivery and Forward Commitments**

A Fund may purchase or sell particular securities with payment and delivery taking place at a later date. When a Fund agrees to purchase securities on a when-issued or delayed delivery basis or enter into a forward commitment to purchase securities, it is required to comply with Rule 18f-4 under the 1940 Act. See the section entitled "Foreign Currency Transactions" above for additional information.

When-issued and forward commitment transactions involve the risk that the price or yield obtained in a transaction (and therefore the value of a security) may be less favorable then the price or yield (and therefore the value of a security) available in the market when the delivery of the securities takes place.

If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a commitment after it is entered into, and may sell securities it has committed to purchase before those securities are delivered to a Fund on the settlement date. In these cases, a Fund may realize a capital gain or loss.

When a Fund engages in when-issued, delayed delivery and forward commitment transactions, it relies on the other party to consummate the trade. Failure of such party to do so may result in a Fund incurring a loss or failing to receive a cumulative profit on the trade.

The market value of the securities underlying a when-issued purchase or a forward commitment to purchase securities, and any subsequent fluctuations in their market value, are taken into account when determining the NAV of a Fund starting on the day the Fund agrees to purchase the securities. A Fund does not earn interest on the securities it has committed to purchase until they are paid for and delivered on the settlement date. When a Fund makes a forward commitment to sell securities it owns, the proceeds to be received upon settlement are included in such Fund's assets. Fluctuations in the market value of the underlying securities are not reflected in the Fund's NAV as long as the commitment remains in effect.

**Zero-Coupon, Delayed Interest and Capital Appreciation Securities**

A Fund may invest in zero-coupon, delayed interest, pay-in-kind ("PIK") and capital appreciation securities, which are securities that make no periodic interest payments, but are sold at a deep discount from their face value. The buyer recognizes a rate of return determined by the gradual appreciation of the security, which is redeemed at face value on a specified maturity date. The discount varies depending on the time remaining until maturity, as well as market interest rates, the liquidity of the security, and the issuer's perceived credit quality. The discount, in the absence of financial difficulties of the issuer, typically decreases as the final maturity date approaches. If the issuer defaults, a Fund may not receive any return on its investment. Because such securities bear no interest and compound semi-annually at the rate fixed at the time of issuance, their value generally is more volatile than the value of other fixed income securities. Since such bondholders do not receive interest payments, when interest rates rise, zero-coupon, delayed interest and capital appreciation securities fall more dramatically in value than bonds paying interest on a current basis. When interest rates fall, zero-coupon, delayed interest and capital appreciation securities rise more rapidly in value because the bonds reflect a fixed rate of return. An investment in zero-coupon, delayed interest and capital appreciation securities may cause a Fund to recognize income and make distributions to shareholders before it receives any cash payments on its investment. To generate cash to satisfy distribution requirements, a Fund may have to sell portfolio securities that it otherwise would have continued to hold or to use cash flows from other sources such as the sale of Fund shares.

PIK securities may be debt obligations or preferred shares that provide the issuer with the option of paying interest or dividends on such obligations in cash or in the form of additional securities rather than cash. Similar to zero-coupon bonds and delayed interest securities, PIK securities are designed to give an issuer flexibility in managing cash flow. PIK securities that are debt securities can be either senior or subordinated debt and generally trade flat (*i.e.*, without interest). The trading price of PIK debt securities generally reflects the market value of the underlying debt plus an amount representing accrued interest since the last interest payment.

**Disclosure of Portfolio Holdings**

The Trust has adopted, on behalf of the Funds, a policy relating to the selective disclosure of a Fund's portfolio holdings by the Advisor, Board, officers, or third party service providers, in accordance with regulations that seek to ensure that disclosure of information about portfolio holdings is in the best interest of Fund shareholders. The policies relating to the disclosure of a Fund's portfolio holdings are designed to allow disclosure of portfolio holdings information where necessary to the Fund's operation without compromising the integrity or performance of the Fund. It is the policy of the Trust that disclosure of a Fund's portfolio holdings to a select person or persons prior to the release of such holdings to the public ("selective disclosure") is prohibited, unless there are legitimate business purposes for selective disclosure.

The Trust discloses portfolio holdings information as required in regulatory filings and shareholder reports, discloses portfolio holdings information as required by federal and state securities laws and may disclose portfolio holdings information in response to requests by governmental authorities. As required by the federal securities laws, including the 1940 Act, the Trust will disclose each Fund's portfolio holdings in applicable regulatory filings, including shareholder reports, reports on Form N-CSR, Form N-CEN, and Form N-PORT, or such other filings, reports or disclosure documents as the applicable regulatory authorities may require.

Generally, after the 30th business day of the month following each calendar quarter end, each Fund may provide, at the Advisor's discretion, its portfolio holdings to various rating and ranking organizations. In addition, generally after the 30th business day of the month following each calendar quarter end, each Fund may post to its website a list of its top ten holdings or full portfolio holdings at the discretion of the Advisor. The timing, frequency and type (i.e., ratings/rankings/holdings) of disclosure may change at the Advisor's discretion, as well as whether to post to each Fund's website.

The Trust may distribute or authorize the distribution of information about a Fund's portfolio holdings that is not publicly available to its third-party service providers, which include U.S. Bank, N.A., the custodian; U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services ("Fund Services"), the administrator, accounting agent and transfer agent; Tait, Weller & Baker LLP, the Funds' independent registered public accounting firm; Faegre Drinker Biddle & Reath LLP, legal counsel; FilePoint, the financial printer; the Funds' proxy voting service(s); and the Trust's liquidity classification agent. These service providers are required to keep such information confidential, and are prohibited from trading based on the information or otherwise using the information except as necessary in providing services to a Fund. Such holdings are released on conditions of confidentiality, which include appropriate trading prohibitions.

"Conditions of confidentiality" include confidentiality terms included in written agreements, implied by the nature of the relationship (e.g. attorney-client relationship), or required by fiduciary or regulatory principles (e.g., custody services provided by financial institutions). Portfolio holdings may also be provided earlier to shareholders and their agents who receive redemptions in kind that reflect a pro rata allocation of all securities held in a Fund's portfolio.

Portfolio holdings may also be disclosed, upon authorization by a designated officer of the Advisor, to (i) certain independent reporting agencies recognized by the SEC as acceptable agencies for the reporting of industry statistical information and (ii) financial consultants to assist them in determining the suitability of the Funds as an investment for their clients, in each case in accordance with the anti-fraud provisions of the federal securities laws and the Company's and the Advisor's fiduciary duties to Fund shareholders. Disclosures to financial consultants are also subject to a confidentiality agreement and/or trading restrictions. The foregoing disclosures are made pursuant to the Trust's policy on selective disclosure of portfolio holdings. The Board or a committee thereof may, in limited circumstances, permit other selective disclosure of portfolio holdings subject to a confidentiality agreement and/or trading restrictions.

The Advisor reserves the right to refuse to fulfill any request for portfolio holdings information from a shareholder or non-shareholder if it believes that providing such information will be contrary to the best interests of a Fund.

The Board provides ongoing oversight of the Trust's policies and procedures and compliance with such policies and procedures. As part of this oversight function, the Board receives from the Trust's Chief Compliance Officer ("CCO") as necessary, reports on compliance with these policies and procedures. In addition, the Board receives an annual assessment of the adequacy and effectiveness of the policies and procedures with respect to a Fund, and any changes thereto, and an annual review of the operation of the policies and procedures. Any violation of the policy set forth above as well as any corrective action undertaken to address such violation must be reported by the Advisor, director, officers or third party service providers to the Trust's CCO, who will determine whether the violation should be reported immediately to the Board or at its next quarterly Board meeting.

**Management of the Funds**

**Board of Trustees**

The business and affairs of the Trust are managed under the oversight of the Board, subject to the laws of the State of Delaware and the Trust's organizational documents. The Trustees are responsible for deciding matters of overall policy and overseeing the actions of the Trust's service providers. The officers of the Trust conduct and supervise the Trust's daily business operations.

Trustees who are not deemed to be "interested persons" of the Trust (as defined in the 1940 Act) are referred to as "Independent Trustees." Trustees who are deemed to be "interested persons" of the Trust are referred to as "Interested Trustees." The Board is currently composed of seven Independent Trustees and one Interested Trustee. The Board has selected Arnold M. Reichman, an Independent Trustee, to act as Chairman. Mr. Reichman's duties include presiding at meetings of the Board and interfacing with management to address significant issues that may arise between regularly scheduled Board and Committee meetings. In the performance of his duties, Mr. Reichman will consult with the other Independent Trustees and the Trust's officers and legal counsel, as appropriate. The Chairman may perform other functions as requested by the Board from time to time.

The Board meets as often as necessary to discharge its responsibilities. Currently, the Board conducts regular, in-person meetings at least four times a year, and holds special in-person or telephonic meetings as necessary to address specific issues that require attention prior to the next regularly scheduled meeting. The Board also relies on professionals, such as the Trust's independent registered public accounting firms and legal counsel, to assist the Trustees in performing their oversight responsibilities.

The Board has established seven standing committees — Audit, Contract, Executive, Nominating and Governance, Product Development, Regulatory Oversight, and Valuation Committees. The Board may establish other committees, or nominate one or more Trustees to examine particular issues related to the Board's oversight responsibilities, from time to time. Each Committee meets periodically to perform its delegated oversight functions and reports its findings and recommendations to the Board. For more information on the Committees, see the section entitled "Standing Committees."

The Board has determined that the Trust's leadership structure is appropriate because it allows the Board to effectively perform its oversight responsibilities.

**Trustees and Executive Officers**

The Trustees and executive officers of the Trust, their ages, business addresses and principal occupations during the past five years are set forth below.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name, Address,<br> and Age | Position(s)<br> Held with<br> Company | Term of Office<br> and<br> Length of<br> Time<br> Served<sup>1</sup> | Principal Occupation(s)<br> During Past 5 Years | Number of<br> Portfolios in<br> Fund <br> Complex<br> Overseen by<br> Trustee\* | Other<br> Directorships<br> Held by Trustee<br> in the Past 5 Years |
| **INDEPENDENT TRUSTEES** | **INDEPENDENT TRUSTEES** | **INDEPENDENT TRUSTEES** | **INDEPENDENT TRUSTEES** | **INDEPENDENT TRUSTEES** | **INDEPENDENT TRUSTEES** |
| Julian A. Brodsky<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 89 | Trustee | June 2021 to present | From 1969 to 2011, Director and Vice Chairman, Comcast Corporation (cable television and communications). | 57 | AMDOCS Limited (service provider to telecommunications companies). |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name, Address,<br> and Age | Position(s)<br> Held with<br> Company | Term of Office<br> and<br> Length of<br> Time<br> Served<sup>1</sup> | Principal Occupation(s)<br> During Past 5 Years | Number of<br> Portfolios in<br> Fund <br> Complex<br> Overseen by<br> Trustee\* | Other<br> Directorships<br> Held by Trustee<br> in the Past 5 Years |
| Gregory P. Chandler<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 56 | Trustee | June 2021 to present | Since 2020, Chief Financial Officer, Herspiegel Consulting LLC (life sciences consulting services); 2020, Chief Financial Officer, Avocado Systems Inc. (cyber security software provider); 2009-2020, Chief Financial Officer, Emtec, Inc. (information technology consulting/services). | 57 | FS Energy and Power Fund (business development company); Wilmington Funds (12 portfolios) (registered investment company); Emtec, Inc. (until December 2019); FS Investment Corporation (business development Company) (until December 2018). |
| Lisa A. Dolly<br> 615 East Michigan<br> Street, Milwaukee,<br> WI, 53202<br> Age: 56  | Trustee | October 2021 to present | From July 2019-December 2019, Chairman, Pershing LLC (broker dealer, clearing and custody firm); January 2016-June 2019, Chief Executive Officer, Pershing, LLC. | 57 | Allfunds Group PLC (United Kingdom wealthtech and fund distribution provider); Securities Industry and Financial Markets Association (trade association for broker dealers, investment banks and asset managers); Hightower Advisors (wealth management firm). |
| Nicholas A. Giordano<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 79 | Trustee | June 2021 to present | Since 1997, Consultant, financial services organizations. | 57 | IntriCon Corporation (biomedical device manufacturer); Wilmington Funds (12 portfolios) (registered investment company); Independence Blue Cross (healthcare insurance) (until 2021). |
| Arnold M. Reichman<br> 615 East Michigan Street Milwaukee, WI 53202<br> Age: 74 | Chairman<br> Trustee | June 2021 to present<br>June 2021 to present | Retired. | 57 | EIP Investment Trust (registered investment company) (until August 2022) |
| Brian T. Shea<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 62 | Trustee | June 2021 to present | From 2014-2017, Chief Executive Officer, BNY Mellon Investment Services (fund services, global custodian and securities clearing firm); from 1983-2014, Chief Executive Officer and various positions, Pershing LLC (broker dealer, clearing and custody firm). | 57 | Fidelity National Information Services, Inc. (financial services technology company); Ameriprise Financial, Inc. (financial services company); WisdomTree Investments, Inc.(asset management company) (until March 2019). |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name, Address,<br> and Age | Position(s)<br> Held with<br> Company | Term of Office<br> and<br> Length of<br> Time<br> Served<sup>1</sup> | Principal Occupation(s)<br> During Past 5 Years | Number of<br> Portfolios in<br> Fund <br> Complex<br> Overseen by<br> Trustee\* | Other<br> Directorships<br> Held by Trustee<br> in the Past 5 Years |
| Robert A. Straniere<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 81 | Trustee | June 2021 to present | Since 2009, Administrative Law Judge, New York City; since 1980, Founding Partner, Straniere Law Group (law firm). | 57 | None. |
| **INTERESTED TRUSTEE<sup>2</sup>** | **INTERESTED TRUSTEE<sup>2</sup>** | **INTERESTED TRUSTEE<sup>2</sup>** | **INTERESTED TRUSTEE<sup>2</sup>** | **INTERESTED TRUSTEE<sup>2</sup>** | **INTERESTED TRUSTEE<sup>2</sup>** |
| Robert Sablowsky<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 84 | Trustee | June 2021 to present | Since 2002, Senior Director – Investments and prior thereto, Executive Vice President, of Oppenheimer & Co., Inc. (a registered broker-dealer). | 57 | None. |
| **OFFICERS** | **OFFICERS** | **OFFICERS** | **OFFICERS** | **OFFICERS** | **OFFICERS** |
| Steven Plump<br> 615 East Michigan<br> Street<br> Milwaukee, WI 53202<br> Age: 63 | President | August 2022 to present | From 2011 to 2021, Executive Vice President, PIMCO LLC. | N/A | N/A |
| Salvatore Faia, JD,<br> CPA, CFE<br> Vigilant Compliance,<br> LLC<br> Gateway Corporate<br> Center Suite 216<br> 223 Wilmington West<br> Chester Pike<br> Chadds Ford, PA<br> 19317<br> Age: 60 | Chief Compliance Officer | June 2021 to present | Since 2021, Chief Compliance Officer of The RBB Fund Trust (formerly, Penn Capital Funds Trust); since 2004, President, Vigilant Compliance, LLC (investment management services company); since 2005, Independent Trustee of EIP Investment Trust (registered investment company); Since 2004, Chief Compliance Officer of The RBB Fund, Inc.; President of The RBB Fund, Inc.;. from 2009 to 2022; from 2021 to 2022, President of The RBB Fund Trust. | N/A | N/A |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name, Address,<br> and Age | Position(s)<br> Held with<br> Company | Term of Office<br> and<br> Length of<br> Time<br> Served<sup>1</sup> | Principal Occupation(s)<br> During Past 5 Years | Number of<br> Portfolios in<br> Fund <br> Complex<br> Overseen by<br> Trustee\* | Other<br> Directorships<br> Held by Trustee<br> in the Past 5 Years |
| James G. Shaw<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 62 | Chief Financial Officer<br> and Secretary<br> Chief Operating Officer | June 2021 to present<br>August 2022 to present<br>| Chief Financial Officer and Secretary (since 2016) and Chief Operating Officer (since 2022) of The RBB Fund, Inc.; Chief Financial Officer and Secretary (since 2021) and Chief Operating Officer (since 2022) of The RBB Fund Trust; from 2005 to 2016, Assistant Treasurer of The RBB Fund, Inc.; from 1995 to 2016, Senior Director and Vice President of BNY Mellon Investment Servicing (US) Inc. (financial services company).  | N/A | N/A |
| Craig A. Urciuoli<br> 615 East Michigan Street&nbsp;&nbsp;&nbsp;&nbsp; <br> Milwaukee, WI<br> 53202 <br> Age: 48 | Director of Marketing & Business Development | June 2021 to present | Director of Marketing & Business Development of The RBB Fund, Inc. (since 2019) and The RBB Fund Trust (since 2021); from 2000-2019, Managing Director, Third Avenue Management LLC (investment advisory firm). | N/A | N/A |
| Jennifer Witt<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 40 | Assistant Treasurer | June 2021 to present | Since 2020, Vice President, U.S. Bank Global Fund Services (fund administrative services firm); from 2016 to 2020, Assistant Vice President, U.S. Bank Global Fund Services; from 2007 to 2016, Supervisor, Nuveen Investments (registered investment company). | N/A | N/A |
| Edward Paz<br> 615 East Michigan<br> Street Milwaukee,<br> WI 53202<br> Age: 51 | Assistant Secretary | June 2021 to present | Since 2007, Vice President and Counsel, U.S. Bank Global Fund Services (fund administrative services firm). | N/A | N/A |
| Michael P. Malloy<br> One Logan Square<br> Suite 2000<br> Philadelphia, PA<br> 19103<br> Age: 63 | Assistant Secretary | June 2021 to present | Since 1993, Partner, Faegre Drinker Biddle & Reath LLP (law firm). | N/A | N/A |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name, Address,<br> and Age | Position(s)<br> Held with<br> Company | Term of Office<br> and<br> Length of<br> Time<br> Served<sup>1</sup> | Principal Occupation(s)<br> During Past 5 Years | Number of<br> Portfolios in<br> Fund <br> Complex<br> Overseen by<br> Trustee\* | Other<br> Directorships<br> Held by Trustee<br> in the Past 5 Years |
| Jillian L. Bosmann<br> One Logan Square,<br> Suite 2000<br> Philadelphia, PA<br> 19103<br> Age: 43 | Assistant Secretary | June 2021 to present | Since 2017, Partner, Faegre Drinker Biddle & Reath LLP (law firm). | N/A | N/A |

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\* Each Trustee oversees 57 portfolios of the fund complex, consisting of the series in the Trust (9 portfolios) and The RBB Fund, Inc. (48 portfolios).

&nbsp;&nbsp;&nbsp;&nbsp;1. Subject
 to the Trust's Retirement Policy, each Trustee may continue to serve as a Trustee
 until the last day of the calendar year in which the applicable Trustee attains age 75
 or until his successor is elected and qualified or his death, resignation or removal.
 The Board reserves the right to waive the requirements of the Policy with respect to
 an individual Trustee. The Board has approved waivers of the policy with respect to Messrs.
 Brodsky, Giordano, Sablowsky and Straniere. Each officer holds office at the pleasure
 of the Board until the next special meeting of the Trust or until his or her successor
 is duly elected and qualified, or until he or she dies, resigns or is removed.

&nbsp;&nbsp;&nbsp;&nbsp;2. Mr.
 Sablowsky is considered an "interested person" of the Trust as that term
 is defined in the 1940 Act and is referred to as an "Interested Trustee."
 Mr. Sablowsky is considered an "Interested Trustee" of the Trust by virtue
 of his position as a senior officer of Oppenheimer & Co., Inc., a registered broker-dealer.

**Trustee Experience, Qualifications, Attributes and/or Skills**

The information above includes each Trustee's principal occupations during the last five years. Each Trustee possesses extensive additional experience, skills and attributes relevant to his or her qualifications to serve as a Trustee. The cumulative background of each Trustee led to the conclusion that each Trustee should serve as a Trustee of the Trust. Mr. Brodsky has over 40 years of senior executive-level management experience in the cable television and communications industry. Mr. Chandler has demonstrated leadership and management abilities as evidenced by his senior executive-level positions in the investment technology consulting/services and investment banking/brokerage industries, and also serves on various boards. Ms. Dolly has over three decades of experience in the financial services industry, and she has demonstrated her leadership and management abilities by serving in numerous senior executive-level positions. Mr. Giordano has years of experience as a consultant to financial services organizations and also serves on the boards of other registered investment companies. Mr. Reichman brings decades of investment management experience to the Board, in addition to senior executive-level management experience. Mr. Sablowsky has demonstrated leadership and management abilities as evidenced by his senior executive-level positions in the financial services industry. Mr. Shea has demonstrated leadership and management abilities as evidenced by his senior executive-level positions in the brokerage, clearing and investment services industry, including service on the boards of industry regulatory organizations and a university. Mr. Straniere has been a practicing attorney for over 30 years and has served on the boards of an asset management company and another registered investment company.

**Standing Committees** 

The responsibilities of each Committee of the Board and its members are described below.

**Audit Committee.** The Board has an Audit Committee comprised of three Independent Trustees. The current members of the Audit Committee are Messrs. Brodsky, Chandler and Giordano. The Audit Committee, among other things, reviews results of the annual audit and approves the firm(s) to serve as independent auditors. The Audit Committee convened three times during the fiscal year ended August 31, 2022.

**Contract Committee.** The Board has a Contract Committee comprised of the Interested Trustee and four Independent Trustees. The current members of the Contract Committee are Ms. Dolly and Messrs. Brodsky, Chandler, Sablowsky and Straniere. The Contract Committee reviews and makes recommendations to the Board regarding the approval and continuation of agreements and plans of the Trust. The Contract Committee convened five times during the fiscal year ended August 31, 2022.

**Executive Committee.** The Board has an Executive Committee comprised of the Interested Trustee and three Independent Trustees. The current members of the Executive Committee are Messrs. Chandler, Giordano, Reichman and Sablowsky. The Executive Committee may generally carry on and manage the business of the Trust when the Board is not in session. The Executive Committee did not meet during the fiscal year ended August 31, 2022.

**Nominating and Governance Committee.** The Board has a Nominating and Governance Committee comprised of three Independent Trustees. The current members of the Nominating and Governance Committee are Messrs. Brodsky, Giordano and Reichman. The Nominating and Governance Committee recommends to the Board all persons to be nominated as Trustees of the Trust. The Nominating and Governance Committee will consider nominees recommended by shareholders. Recommendations should be submitted to the Committee care of the Trust's Secretary. The Nominating and Governance Committee convened two times during the fiscal year ended August 31, 2022.

**Product Development Committee.** The Board has a Product Development Committee comprised of the Interested Trustee and three Independent Trustees. The current members of the Product Development Committee are Messrs. Chandler, Reichman, Sablowsky and Shea. The Product Development Committee oversees the process regarding the addition of new investment advisers and investment products to the Trust. The Product Development Committee met five times during the fiscal year ended August 31, 2022.

**Regulatory Oversight Committee.** The Board has a Regulatory Oversight Committee comprised of the Interested Trustee and four Independent Trustees. The current members of the Regulatory Oversight Committee are Ms. Dolly and Messrs. Reichman, Sablowsky, Shea and Straniere. The Regulatory Oversight Committee monitors regulatory developments in the mutual fund industry and focuses on various regulatory aspects of the operation of the Trust. The Regulatory Oversight Committee met four times during the fiscal year August 31, 2022.

**Valuation Committee.** The Board has a Valuation Committee comprised of the Interested Trustee and two officers of the Trust. The members of the Valuation Committee are Messrs. Faia, Sablowsky and Shaw. The Valuation Committee is responsible for reviewing fair value determinations. The Valuation Committee met four times during the fiscal year ended August 31, 2022.

**Risk Oversight**

The Board performs its risk oversight function for the Trust through a combination of (1) direct oversight by the Board as a whole and Board committees and (2) indirect oversight through the Trust's investment adviser and other service providers, Trust officers and the Trust's Chief Compliance Officer. The Trust is subject to a number of risks, including but not limited to investment risk, compliance risk, operational risk, reputational risk, credit risk and counterparty risk. Day-to-day risk management with respect to the Trust is the responsibility of the Trust's investment adviser or other service providers (depending on the nature of the risk) that carry out the Trust's investment management and business affairs. Each of the investment adviser and the other service providers have their own independent interest in risk management and their policies and methods of risk management will depend on their functions and business models and may differ from the Trust's and each other's in the setting of priorities, the resources available or the effectiveness of relevant controls.

The Board provides risk oversight by receiving and reviewing on a regular basis reports from the Trust's investment adviser or other service providers, receiving and approving compliance policies and procedures, periodic meetings with the Trust's portfolio managers to review investment policies, strategies and risks, and meeting regularly with the Trust's Chief Compliance Officer to discuss compliance reports, findings and issues. The Board also relies on the Trust's investment adviser and other service providers, with respect to the day-to-day activities of the Trust, to create and maintain procedures and controls to minimize risk and the likelihood of adverse effects on the Trust's business and reputation.

Board oversight of risk management is also provided by various Board Committees. For example, the Audit Committee meets with the Trust's independent registered public accounting firm to ensure that the Trust's audit scope include risk-based considerations as to the Trust's financial position and operations. The Board may, at any time and in its discretion, change the manner in which it conducts risk oversight. The Board's oversight role does not make the Board a guarantor of the Trust's investments or activities.

**Trustee Ownership of Shares of the Funds**

The following table sets forth the dollar range of equity securities beneficially owned by each Trustee in the Funds and in all of the portfolios of the Trust (which for each Trustee comprise all registered investment companies within the Trust's family of investment companies overseen by him or her), as of December 31, 2021, including the amounts through the deferred compensation plan.

---

| | | |
|:---|:---|:---|
| **Name of Trustee** | **Dollar Range of Equity**<br> **Securities in the Funds** | **Aggregate Dollar Range of**<br> **Equity Securities in All**<br> **Registered Investment Companies**<br> **Overseen by Trustee within the**<br> **Family of Investment Companies** |
|  | **Independent Trustees** |  |
| Julian A. Brodsky |  | Over $100,000 |
| Gregory P. Chandler |  | Over $100,000 |
| Lisa A. Dolly<sup>1</sup> |  |  |
| Nicholas A. Giordano |  | $10001-$50000 |
| Arnold M. Reichman |  | $50001-$100000 |
| Brian T. Shea |  | $10001-$50000 |
| Robert A. Straniere |  | $1-$10000 |
|  | **Interested Trustee** |  |
| Robert Sablowsky |  | Over $100,000 |

---

<sup>1</sup> Ms. Dolly began serving as a Trustee effective October 1, 2021.

As of December 31, 2021, the Independent Trustees and their respective immediate family members (spouse or dependent children) did not own beneficially or of record any securities of the Trust's investment advisers or distributors, or of any person directly or indirectly controlling, controlled by, or under common control with the investment advisers or distributors.

**Trustees' and Officers' Compensation**

Effective January 1, 2023, the Trust and the RBB Fund, Inc., based on an allocation formula, pay each Trustee a retainer at the rate of $150,000 annually, $13,500 for each regular meeting of the Board, $5,000 for each Regulatory Oversight Committee meeting attended in-person, $4,000 for each other committee (excluding the Regulatory Oversight Committee) meeting attended in-person, and $2,000 for each committee meeting attended telephonically or special meeting of the Board attended in-person or telephonically. The Chairman of the Audit Committee and Chairman of the Regulatory Oversight Committee each receives an additional fee of $20,000 for his services. The Chairman of the Contract Committee and the Chairman of the Nominating and Governance Committee each receives an additional fee of $10,000 per year for his services. The Vice Chairman of the Board receives an additional fee of $35,000 per year for his services in this capacity and the Chairman of the Board receives an additional fee of $75,000 per year for his services in this capacity.

From January 1, 2022 through December 31, 2022, the Company and The RBB Fund Trust, based on an allocation formula, paid each Trustee a retainer at the rate of $125,000 annually, $13,500 for each regular meeting of the Board, $3,500 for each committee meeting attended in-person, and $2,000 for each committee meeting attended telephonically or special meeting of the Board attended in-person or telephonically. The Chairman of the Audit Committee and Chairman of the Regulatory Oversight Committee each received an additional fee of $20,000 for his services. The Chairman of the Contract Committee and the Chairman of the Nominating and Governance Committee each received an additional fee of $10,000 per year for his services. The Vice Chairman of the Board received an additional fee of $35,000 per year for his services in this capacity and the Chairman of the Board received an additional fee of $75,000 per year for his services in this capacity.

From June 24, 2021 through December 31, 2021, the Trust and The RBB Fund, Inc., based on an allocation formula, paid each Trustee a retainer at the rate of $125,000 annually, $10,000 for each regular meeting of the Board, $3,500 for each committee meeting attended in-person, and $2,000 for each committee meeting attended telephonically or special meeting of the Board attended in-person or telephonically. The Chairman of the Audit Committee and Chairman of the Regulatory Oversight Committee each received an additional fee of $20,000 for his services. The Chairman of the Contract Committee and the Chairman of the Nominating and Governance Committee each received an additional fee of $10,000 per year for his services. The Vice Chairman of the Board received an additional fee of $35,000 per year for his services in this capacity and the Chairman of the Board received an additional fee of $75,000 per year for his services in this capacity.

Trustees are reimbursed for any reasonable out-of-pocket expenses incurred in attending meetings of the Board or any committee thereof. An employee of Vigilant Compliance, LLC serves as Chief Compliance Officer of the Trust and served as President of the Trust until August 2022. Vigilant Compliance, LLC is compensated for the services provided to the Trust, and such compensation is determined by the Board. For the fiscal year ended August 31, 2022, Vigilant Compliance, LLC received $758,511 in the aggregate from all series of the Trust and The RBB Fund, Inc. for its services, and received $3,548 from the Penn Capital Floating Rate Income Fund, $3,902 from the Penn Capital Short Duration High Income Fund, $2,907 from the Penn Capital Opportunistic High Income Fund, $1,513 from the Penn Capital Mid Cap Core Fund, and $1,958 from the Penn Capital Special Situations Small Cap Equity Fund. Employees of the Trust serve as President, Chief Financial Officer, Chief Operating Officer, Secretary and Director of Marketing & Business Development, and are compensated for services provided. For the fiscal year ended August 31, 2022, each of the following members of the Board and the President, Chief Financial Officer, Chief Operating Officer, Secretary and Director of Marketing & Business Development received compensation from the Trust and The RBB Fund, Inc. in the following amounts:

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| | | | |
|:---|:---|:---|:---|
| **Name of Trustee/Officer** | **Aggregate Compensation from the Funds\*** | **Pension or Retirement Benefits Accrued as Part of Fund Expenses** | **Total Compensation From Fund Complex Paid to Trustees or Officers** |
| **Independent Trustees:** |  |  |  |
| Julian A. Brodsky | $3995 | N/A | $198000 |
| J. Richard Carnall<sup>(1)</sup> | $0 | N/A | $0 |
| Gregory P. Chandler | $4374 | N/A | $232500 |
| Lisa A. Dolly<sup>(2)</sup> | $3975 | N/A | $182000 |
| Nicholas A. Giordano | $3927 | N/A | $210000 |
| Arnold M. Reichman | $5108 | N/A | $282000 |
| Brian T. Shea | $3970 | N/A | $182500 |
| Robert A. Straniere | $4406 | N/A | $203500 |
| **Interested Trustee:** |  |  |  |
| Robert Sablowsky | $5079 | N/A | $262500 |
| **Officers:** |  |  |  |
| Steven Plump, President<sup>(3)</sup> | $122 | N/A | $20000 |
| James G. Shaw, Chief Financial Officer, Chief Operating Officer, and Secretary | $1928 | N/A | $315500 |
| Craig Urciuoli, Director of Marketing & Business Development | $1601 | N/A | $262032 |

---

<sup>(1)</sup> Mr. Carnall retired from his role as a Trustee effective October 1, 2021.

<sup>(2)</sup> Ms. Dolly was appointed as a Trustee effective October 1, 2021.

<sup>(3)</sup> Mr. Plump was appointed President on August 4, 2022.

For the fiscal year ended August 31, 2022, each of the following members of the Board and the President, Chief Financial Officer, Chief Operating Officer, Secretary and Director of Marketing & Business Development received compensation from each of the Funds in the following amounts:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Name of Trustee/Officer** | **Penn Capital Floating Rate Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Special Situations Small Cap Equity Fund** |
| **Independent Trustees:** |  |  |  |  |  |
| Julian A. Brodsky, Trustee | $1108 | $1228 | $643 | $507 | $508 |
| J. Richard Carnall, Trustee<sup>(1)</sup> | $0 | $0 | $0 | $0 | $0 |
| Gregory P. Chandler, Trustee | $1213 | $1345 | $704 | $555 | $557 |
| Lisa A. Dolly, Trustee<sup>(2)</sup> | $1102 | $1222 | $640 | $505 | $506 |
| Nicholas A. Giordano, Trustee | $1089 | $1207 | $632 | $498 | $500 |
| Arnold M. Reichman, Trustee and Chairman | $1417 | $1570 | $822 | $648 | $650 |
| Brian T. Shea, Trustee | $1102 | $1221 | $639 | $504 | $505 |
| Robert A. Straniere, Trustee | $1222 | $1355 | $709 | $559 | $561 |
| **Interested Trustee:** |  |  |  |  |  |
| Robert Sablowsky, Trustee | $1408 | $1562 | $818 | $645 | $646 |
| **Officers:** |  |  |  |  |  |
| Steven Plump, President <sup>(3)</sup> | $33 | $37 | $20 | $14 | $18 |
| James G. Shaw, Chief Financial Officer, Chief Operating Officer and Secretary | $526 | $578 | $311 | $224 | $290 |
| Craig Urciuoli, Director of Marketing & Business Development | $436 | $480 | $258 | $186 | $241 |

---

<sup>(1)</sup> Mr. Carnall retired from his role as a Trustee effective October 1, 2021.

<sup>(2)</sup> Ms. Dolly was appointed as a Trustee effective October 1, 2021.

<sup>(3)</sup> Mr. Plump was appointed President on August 4, 2022.

Each compensated Trustee is entitled to participate in the Trust's deferred compensation plan (the "DC Plan"). Under the DC Plan, a compensated Trustee may elect to defer all or a portion of his or her compensation and have the deferred compensation treated as if it had been invested by the Trust in shares of one or more of the portfolios of the Trust. The amount paid to the Trustees under the DC Plan will be determined based upon the performance of such investments.

**Trustee Emeritus Program** 

The Board has created a position of Trustee Emeritus, whereby an incumbent Trustee who has attained at least the age of 75 and completed a minimum of fifteen years of service as a Trustee or Director of The RBB Fund, Inc. may, in the sole discretion of the Nominating and Governance Committee of the Company ("Committee"), be recommended to the full Board to serve as Trustee Emeritus.

A Trustee Emeritus that has been approved as such receives an annual fee in an amount equal to up to 50% of the annual base compensation paid to a Trustee. Compensation will be determined annually by the Committee and the Board with respect to each Trustee Emeritus. In addition, a Trustee Emeritus will be reimbursed for any expenses incurred in connection with their service, including expenses of travel and lodging incurred in attendance at Board meetings. A Trustee Emeritus will continue to receive relevant materials concerning the Funds and will be available to consult with the Trustees at reasonable times as requested. However, a Trustee Emeritus does not have any voting rights at Board meetings and is not subject to election by shareholders of the Funds.

A Trustee Emeritus will be permitted to serve in such capacity from year to year at the pleasure of the Committee and the Board for up to three years.

Effective October 1, 2021, J. Richard Carnall serves as a Trustee Emeritus of the Trust. For the fiscal year ended August 31, 2022, J. Richard Carnall received compensation for his role as a Trustee Emeritus in the following amounts:

---

| | | |
|:---|:---|:---|
| **Aggregate Compensation from the Fund** | **Pension or Retirement Benefits Accrued as Part of Fund Expenses** | **Total Compensation From Fund Complex** |
| $627 | N/A | $62500 |

---

For the fiscal year ended August 31, 2022, the Trustee Emeritus received compensation from each of the Funds in the following amounts:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Name of Trustee Emeritus** | **Penn Capital Floating Rate Income Fund** | **Penn Capital Short Duration High Income Fund** | **Penn Capital Opportunistic High Income Fund** | **Penn Capital Mid Cap Core Fund** | **Penn Capital Special Situations Small Cap Equity Fund** |
| J. Richard Carnall | $174 | $193 | $101 | $80 | $80 |

---

**Principal Holders, Control Persons and Management Ownership**

A principal shareholder is any person who owns of record or beneficially 5% or more of the outstanding shares of any Fund. A control person is one who owns beneficially or through controlled companies more than 25% of the voting securities of a company or acknowledges the existence of control. Note that a control person possesses the ability to control the outcome of matters submitted for shareholder vote of the Trust.

As of November 30, 2022, the Trustees and officers, as a group, owned less than 1% of the shares of the Funds.

As of November 30, 2022, the following shareholders owned 5% or more of the outstanding shares of the Funds:

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| | |
|:---|:---|
| ***Penn Capital Floating Rate Income Fund – Institutional Class*** | ***Penn Capital Floating Rate Income Fund – Institutional Class*** |
| **Name and Address** | **% Ownership** |
| 525 Holding Co Inc.<br> 1200 Intrepid Ave., FL 4<br> Philadelphia, PA 19112-1230 | 39.93% |
| Richard A. Hocker Revocable Trust<br> Richar A. Hocker & Marcia A. Hocker TR<br> c/o Penn Capital Management<br> 1200 Intrepid Ave., Suite 400<br> Philadelphia, PA 19112-1230 | 15.00% |
| Capinco c/o U.S. Bank, N.A.\*<br> P.O. Box 1787<br> Milwaukee, WI 53201-1787 | 14.01% |
| Charles Schwab & Co., Inc.\*<br> Special Custody A/C FBO Customers<br> Attn: Mutual Funds<br> 211 Main St.<br> San Francisco, CA 94105-1905 | 13.94% |
| National Financial Services LLC\*<br> For the Exclusive Benefit of its Customers<br> Attn Mutual Funds Dept., 4th Floor<br> 499 Washington Blvd.<br> Jersey City, NJ 07310-1995 | 9.41% |

---

---

| | |
|:---|:---|
| ***Penn Capital Short Duration High Income Fund – Institutional Class*** | ***Penn Capital Short Duration High Income Fund – Institutional Class*** |
| **Name and Address** | **% Ownership** |
| TD Ameritrade Inc.\*<br> FBO its Clients<br> P.O. Box 2226<br> Omaha, NE 68103-2226 | 43.93% |
| National Financial Services LLC\*<br> For the Exclusive Benefit of its Customers<br> Attn Mutual Funds Dept., 4th Floor<br> 499 Washington Blvd.<br> Jersey City, NJ 07310-1995 | 19.07% |
| Newspaper Guild of New York<br> The New York Times Benefits Fund<br> 1501 Broadway, Suite 1724<br> New York, NY 10036-5600 | 14.05% |
| Charles Schwab & Co., Inc.\*<br> Special Custody A/C FBO Customers<br> Attn: Mutual Funds<br> 211 Main St.<br> San Francisco, CA 94105-1905 | 6.72% |
| US Bank NA Customer<br> Richard A. Hocker IRA<br> c/o Penn Capital Management<br> 1200 Intrepid Ave., Suite 400<br> Philadelphia, PA 19112-1230 | 6.08% |

---

---

| | |
|:---|:---|
| ***Penn Capital Opportunistic High Income Fund – Institutional Class*** | ***Penn Capital Opportunistic High Income Fund – Institutional Class*** |
| **Name and Address** | **% Ownership** |
| Richard A. Hocker Revocable Trust<br> Tenant In Co 1<br> Richar A. Hocker & Marcia A. Hocker TR<br> U/A 09/16/2005<br> c/o Penn Capital Management<br> 1200 Intrepid Ave., Suite 400<br> Philadelphia, PA 19112-1230 | 25.56% |
| Axos Clearing LLC\*<br> PO Box 6503<br> Englewood Co 80155-6503 | 23.76% |
| 525 Holding Co Inc.<br> 1200 Intrepid Ave., Fl 4<br> Philadelphia, PA 19112-1230 | 20.07% |
| National Financial Services LLC\*<br> For the Exclusive Benefit of its Customers<br> Attn Mutual Funds Dept., 4th Floor<br> 499 Washington Blvd.<br> Jersey City, NJ 07310-1995 | 14.19% |

---

---

| | |
|:---|:---|
| ***Penn Capital Mid Cap Core Fund*** | ***Penn Capital Mid Cap Core Fund*** |
| **Name and Address** | % Ownership |
| UBS WM USA\*<br> Spec CDY A/C EBOC USBFSI<br> 1000 Harbor Blvd.<br> Weehawken, NJ 07086-6761 | 28.90% |
| 525 Holding Co Inc.<br> 1200 Intrepid Ave., Fl 4<br> Philadelphia, PA 19112-1230 | 22.44% |
| National Financial Services LLC\*<br> For the Exclusive Benefit of its Customers<br> Attn Mutual Funds Dept., 4th Floor<br> 499 Washington Blvd.<br> Jersey City, NJ 07310-1995 | 11.89% |
| Elizabeth Harris<br> South Plainfield, NJ 07080-1641 | 10.14% |
| SEI Private Trust Company\*<br> c/o GWP US Advisors<br> 1 Freedom Valley Drive<br> Oaks, PA 19456-9989 | 8.32% |

---

---

| | |
|:---|:---|
| ***Penn Capital Special Situations Small Cap Equity Fund*** | ***Penn Capital Special Situations Small Cap Equity Fund*** |
| **Name and Address** | **% Ownership** |
| National Financial Services LLC\*<br> For the Exclusive Benefit of its Customers<br> Attn Mutual Funds Dept., 4th Floor<br> 499 Washington Blvd.<br> Jersey City, NJ 07310-1995 | 17.60% |
| Pershing LLC\*<br> 1 Pershing Plz., FL 14<br> Jersey City, NJ 07399-0002 | 16.80% |
| 525 Holding Co Inc.<br> 1200 Intrepid Ave., FL 4<br> Philadelphia, PA 19112-1230 | 11.19% |
| UBS WM USA\*<br> Spec CDY A/C EBOC USBFSI<br> 1000 Harbor Blvd.<br> Weehawken, NJ 07086-6761 | 10.36% |
| Richard A. Hocker Revocable Trust<br> Richar A. Hocker & Marcia A. Hocker TR<br> c/o Penn Capital Management<br> 1200 Intrepid Ave., Suite 400<br> Philadelphia, PA 19112-1230 | 5.59% |
| Eric J. Green<br> Wallingford, PA 19086-6949 | 5.04% |

---

\* Owner of Record

**Investment Advisor**

Penn Capital Management Company, LLC, (the "Advisor"), a Delaware corporation located at 1200 Intrepid Avenue, Suite 400, Philadelphia, Pennsylvania 19112, serves as the Funds' investment advisor. The Advisor is an SEC-registered investment adviser. Kirsten A. Hocker, Andrew A. Smith, Andrew M. Daly, and Spouting Rock Asset Management, LLC, through its ownership position in the Advisor, could be deemed to control the Advisor.

The Board has approved the Advisory Agreement between the Advisor and the Trust, on behalf of each Fund. Under the Advisory Agreement, the Advisor furnishes, at its own expense, all services, facilities and personnel necessary in connection with managing each Fund's investments and effecting portfolio transactions. The Advisor also may pay fees to certain brokers/dealers to have the Funds available for sale through such institutions, as well for certain shareholder services provided to customers purchasing Fund shares through such institutions.

For its services under the Advisory Agreement, the Advisor receives an advisory fee from each Fund as shown below. The Advisor's fee is calculated as a percentage of each Fund's average daily net assets and is assessed to each share class based on the average daily net assets of the class. The Advisor's fee is accrued daily and paid monthly based on the average daily net assets for the prior month.

---

| | |
|:---|:---|
| **Fund** | **Advisory Fee** |
| Penn Capital Floating Rate Income Fund | 0.55% |
| Penn Capital Short Duration High Income Fund | 0.45% |
| Penn Capital Opportunistic High Income Fund | 0.69% |
| Penn Capital Mid Cap Core Fund | 0.90% |
| Penn Capital Special Situations Small Cap Equity Fund | 0.95% |

---

With respect to each Fund, other than the Penn Capital Short Duration High Income Fund and the Penn Capital Opportunistic High Income Fund, the Advisor has contractually agreed to waive its fees and/or pay Fund expenses so that the total annual operating expenses of the Funds (excluding any acquired fund fees and expenses, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) do not exceed the amounts shown below. With respect to the Penn Capital Short Duration High Income Fund, and the Penn Capital Opportunistic High Income Fund, the Advisor has contractually agreed to waive its fees and/or pay Fund expenses so that the total annual operating expenses of the Fund (including any acquired fund fees and expenses incurred by the Fund as a result of its investments in other investment companies managed by the Advisor, but excluding any acquired fund fees and expenses incurred by the Fund as a result of its investments in unaffiliated investment companies, taxes, interest, brokerage fees, certain insurance costs, and extraordinary and other non-routine expenses) do not exceed the amounts shown below. The Advisor and the Board have determined that the expense limitation agreements will remain in place through the period ending December 31, 2023, and will be reviewed each year, at which time the continuation of the expense limitation agreements will be discussed by the Advisor and the Board. The expense limitation agreements also provide that the Advisor is entitled to be reimbursed by a Fund for any fees it waived and/or expenses it paid for a period of three years following the date of the fee waiver or payment, to the extent such reimbursement will not cause the Fund to exceed any applicable expense limit that was in place when the fees were waived or expenses paid.

---

| | |
|:---|:---|
| **Fund** | **Institutional Class Waiver (Operating Expenses not to exceed amounts shown)** |
| Penn Capital Floating Rate Income Fund | 0.64% |
| Penn Capital Short Duration High Income Fund | 0.54% |
| Penn Capital Opportunistic High Income Fund | 0.72% |
| Penn Capital Mid Cap Core Fund | 1.06% |
| Penn Capital Special Situations Small Cap Equity Fund | 1.09% |

---

During the fiscal periods indicated below, the following Funds paid advisory fees to the Advisor, and the Advisor waived fees and/or reimbursed expenses, as indicated in the following tables:

---

| | | | |
|:---|:---|:---|:---|
| | **Advisory Fee Accrued** | **Advisory Fee Waived and/or Expenses Reimbursed** | **Net Advisory Fee Received** |
| **Penn Capital Floating Rate Income Fund** |  |  |  |
| Fiscal Year Ended August 31, 2022 | $176950 | $(150091) | $26859 |
| Fiscal Period Ended August 31, 2021 | $28797 | $(27409) | $1388 |
| Fiscal Year Ended June 30, 2021 | $182183 | $(291063) | $0 |
| Fiscal Year Ended June 30, 2020 | $231851 | $(308125) | $0 |
| **Penn Capital Short Duration High Income Fund** |  |  |  |
| Fiscal Year Ended August 31, 2022 | $179785 | $(133986) | $45799 |
| Fiscal Period Ended August 31, 2021 | $30243 | $(31724) | $0 |
| Fiscal Year Ended June 30, 2021 | $195499 | $(271231) | $0 |
| Fiscal Year Ended June 30, 2020 | $191077 | $(258497) | $0 |
| **Penn Capital Opportunistic High Income Fund** |  |  |  |
| Fiscal Year Ended August 31, 2022 | $132076 | $(133924) | $0 |
| Fiscal Period Ended August 31, 2021 | $22573 | $(30361) | $0 |
| Fiscal Year Ended June 30, 2021 | $130344 | $(256142) | $0 |
| Fiscal Year Ended June 30, 2020 | $122676 | $(241623) | $0 |
| **Penn Capital Mid Cap Core Fund** |  |  |  |
| Fiscal Year Ended August 31, 2022 | $152310 | $(72939) | $79371 |
| Fiscal Period Ended August 31, 2021 | $28947 | $(20635) | $8312 |
| Fiscal Year Ended June 30, 2021 | $157566 | $(198611) | $0 |
| Fiscal Year Ended June 30, 2020 | $141305 | $(169526) | $0 |
| **Penn Capital Special Situations Small Cap Equity Fund** |  |  |  |
| Fiscal Year Ended August 31, 2022 | $156858 | $(80812) | $76046 |
| Fiscal Period Ended August 31, 2021 | $26200 | $(17080) | $9120 |
| Fiscal Year Ended June 30, 2021 | $112885 | $(222981) | $0 |
| Fiscal Year Ended June 30, 2020 | $83616 | $(175626) | $0 |

---

**Portfolio Managers**

**Other Accounts Under Management.** The table below identifies, for each portfolio manager of each Fund, the number of accounts managed (excluding the Funds) and the total assets in such accounts, within each of the following categories: registered investment companies, other pooled investment vehicles, and other accounts. Information in the table is shown as of August 31, 2022. Asset amounts are approximate and have been rounded.

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| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Portfolio Manager** <br> **Other Accounts**  | **Total Accounts** | **Total Accounts** | **Accounts with Performance Fees** | **Accounts with Performance Fees** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Portfolio Manager** <br> **Other Accounts**  | **Number** | **Assets** <br> **($ Millions)**  | **Number** | **Assets** <br> **($ Millions)**  |
| **<u>Peter R. Duffy, CFA</u>** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Registered Investment Companies | 0 | $0 | 0 | $0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Pooled Investment Vehicles | 0 | $0 | 0 | $0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Accounts | 27 | $690 | 2 | $46 |
| **<u>Eric J. Green, CFA</u>** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Registered Investment Companies | 0 | $0 | 0 | $0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Pooled Investment Vehicles | 0 | $0 | 0 | $0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Accounts | 27 | $831 | 0 | $0 |
| **<u>Joseph C. Maguire, CFA</u>** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Registered Investment Companies | 0 | $0 | 0 | $0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Pooled Investment Vehicles | 0 | $0 | 0 | $0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Accounts | 15 | $127 | 0 | $0 |

---

**Portfolio Manager Compensation**

***Compensation***

The Advisor's compensation plans are designed to incentivize employees responsible for investment management and trading. Compensation plans include salaries commensurate with experience, investment performance-based bonuses, profit participation plan and equity ownership for selected individuals. Salary is determined by certain factors including experience, leadership, management, and contributions to the strategic planning and decision-making within the investment processes. The investment performance-based bonuses are based on certain factors, including but not limited to, investment returns as relative to the Fund's benchmark over the 1, 3 and 5-year periods, volatility measurements and individual professional investment performance attribution. Profit participation awards and stock ownership eligibility are awarded based on distinguishing accomplishments to the investment process and/or the Advisor's business. Compensation plans of employees responsible for investment management is managed by the Advisor's executive team.

**Potential Conflicts of Interest** 

Potential conflicts of interest may arise when a Fund's portfolio manager has day-to-day management responsibilities with respect to one or more other funds or accounts, as is the case for the Funds' portfolio managers.

The Advisor and the Funds have adopted compliance policies and procedures that are designed to address various conflicts of interest that may arise for the Advisor and the individuals that it employs. For example, the Advisor seeks to minimize the effects of competing interests for the time and attention of portfolio managers by assigning portfolio managers to manage funds and accounts that share a similar investment style. The Advisor has also adopted trade allocation procedures that are designed to facilitate the fair allocation of limited investment opportunities among multiple funds and accounts. There is no guarantee, however, that these policies and procedures will be able to detect and/or prevent every situation in which an actual or potential conflict may appear.

These potential conflicts include:

*Allocation of Limited Time and Attention*. A portfolio manager who manages multiple funds and/or accounts may devote unequal time and attention to the management of those funds and/or accounts. As a result, the portfolio manager may not be able to focus on the investment opportunities for each of those accounts as fully as might be the case if he or she were to devote attention to a single fund.

*Allocation of Limited Investment Opportunities*. If a portfolio manager identifies a limited investment opportunity that may be suitable for multiple funds and/or accounts, the opportunity may be allocated among these several funds or accounts, which may limit a single fund's ability to take full advantage of the investment opportunity.

*Pursuit of Differing Strategies*. At times, a portfolio manager may determine that an investment opportunity may be appropriate for only some of the funds and/or accounts for which he or she exercises investment responsibility, or may decide that certain of the funds and/or accounts should take differing positions with respect to a particular security. In these cases, the portfolio manager may place separate transactions for one or more funds or accounts which could affect the market price of the security or the execution of the transaction, or both, to the detriment or benefit of one or more other funds and/or accounts.

*Selection of Brokers/Dealers.* Portfolio managers may be able to select or influence the selection of the brokers and dealers that are used to execute securities transactions for the funds and/or account that they supervise. In addition to executing trades, some brokers and dealers provide portfolio managers with brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934, as amended (the "1934 Act")), which may result in the payment of higher brokerage fees than might have otherwise been available. These services may be more beneficial to certain funds or accounts than to others.

*Variation in Compensation*. A conflict of interest may arise where the financial or other benefits available to the portfolio manager differ among the funds and/or accounts that he or she manages. If the structure of the Advisor's management fee and/or the portfolio manager's compensation differs among funds and/or accounts (such as where certain funds or accounts pay higher management fees or performance-based management fees), the portfolio manager might be motivated to help certain funds and/or accounts over others.

***Portfolio Managers Ownership in the Funds.***

**Portfolio Managers Ownership in the Funds.** As of August 31, 2022, each portfolio manager that retained decision making authority over a Fund's management beneficially owned the following dollar range of shares of such Fund:

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| | |
|:---|:---|
| **Fund/Portfolio Manager** | **Dollar Range of Beneficial Ownership in the Fund as of 8/31/22** |
| **Penn Capital Floating Rate Income Fund** |  |
| Peter R. Duffy, CFA | $50001-$100000 |
| **Penn Capital Short Duration High Income Fund** |  |
| Peter R. Duffy, CFA | $100001-$500000 |
| **Penn Capital Opportunistic High Income Fund** |  |
| Peter R. Duffy, CFA | $50001-$100000 |
| **Penn Capital Mid Cap Core Fund** |  |
| Joseph C. Maguire, CFA | $100001-$500000 |

---

---

| | |
|:---|:---|
| **Fund/Portfolio Manager** | **Dollar Range of Beneficial Ownership in the Fund as of 8/31/22** |
| **Penn Capital Special Situations Small Cap Equity Fund** |  |
| Eric J. Green, CFA | $500001 - $1000000 |

---

**Service Providers**

The Trust entered into a number of agreements whereby certain parties provide various services to the Funds.

**Distributor**

**Distribution Services**

Foreside Fund Services, LLC (the "Distributor") is the distributor (also known as principal underwriter) of the shares of the Funds and is located at Three Canal Plaza, Suite 100, Portland, Maine 04101. The Distributor is a registered broker-dealer and is a member of the Financial Industry Regulatory Authority, Inc. ("FINRA").

Under a Distribution Agreement with the Trust, the Distributor acts as the agent of the Trust in connection with the continuous offering of shares of the Funds. The Distributor continually distributes shares of the Funds on a best efforts basis. The Distributor has no obligation to sell any specific quantity of Fund shares. The Distributor and its officers have no role in determining the investment policies or which securities are to be purchased or sold by the Trust.

The Distributor may enter into agreements with selected broker-dealers, banks or other financial intermediaries for distribution of shares of the Funds. With respect to certain financial intermediaries and related fund "supermarket" platform arrangements, the Funds and/or the Advisor, rather than the Distributor, typically enter into such agreements. These financial intermediaries may charge a fee for their services and may receive shareholder service or other fees from parties other than the Distributor. These financial intermediaries may otherwise act as processing agents and are responsible for promptly transmitting purchase, redemption and other requests to the Funds.

Investors who purchase shares through financial intermediaries will be subject to the procedures of those intermediaries through which they purchase shares, which may include charges, investment minimums, cutoff times and other restrictions in addition to, or different from, those listed herein. Information concerning any charges or services will be provided to customers by the financial intermediary through which they purchase shares. Investors purchasing shares of the Funds through financial intermediaries should acquaint themselves with their financial intermediary's procedures and should read the Prospectus in conjunction with any materials and information provided by their financial intermediary. The financial intermediary, and not its customers, will be the shareholder of record, although customers may have the right to vote shares depending upon their arrangement with the intermediary. The Distributor does not receive compensation from the Funds for its distribution services except the distribution/service fees with respect to the shares of those classes for which a Rule 12b-1 plan is effective, as applicable. The Advisor pays the Distributor a fee for certain distribution-related services.

The Distribution Agreement is specifically approved at least annually by the Board or by vote of a majority of a Fund's outstanding voting securities in accordance with the 1940 Act. The Distribution Agreement is terminable without penalty by the Trust on behalf of a Fund on no less than 60 days' written notice when authorized either by a vote of a majority of the outstanding voting securities of the Fund or by vote of a majority of the Board, including a majority of the Independent Trustees who have no direct or indirect financial interest in the operation of the Distribution Agreement, or by the Distributor, and will automatically terminate in the event of its "assignment" (as defined in the 1940 Act).

**Fund Transfer Agent, Administrator and Accountant**

U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services ("Fund Services") provides accounting and administrative services and shareholder servicing to the Funds as transfer agent and dividend disbursing agent. Fund Services' address is 615 East Michigan Street, Milwaukee, Wisconsin 53202. The services provided under the Transfer Agent Servicing Agreement include processing purchase and redemption transactions; establishing and maintaining shareholder accounts and records; disbursing dividends declared by the Funds; day-to-day administration of matters related to the existence of the Trust under state law (other than rendering investment advice); maintenance of its records; preparation, mailing and filing of reports; and assistance in monitoring the total number of shares sold in each state for "Blue Sky" purposes.

Pursuant to a Fund Administration Servicing Agreement and a Fund Accounting Servicing Agreement, each between Fund Services and the Trust, Fund Services also performs certain administrative, accounting and tax reporting functions for the Funds, including preparing and filing federal and state tax returns, preparing and filing securities registration compliance filings with various states, compiling data for and preparing notices to the SEC, assistance in the preparation of the Funds' registration statement under federal and state securities laws, preparing financial statements for the <u>Annual</u> and Semi-Annual Reports, monitoring the Funds' expense accruals, calculating the daily NAV for each Fund, and monitoring the Funds' compliance with their investment objectives and restrictions.

During the following fiscal periods, the Funds paid the following administration and accounting fees to Fund Services:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Fiscal Year Ended August 31, 2022** | **Fiscal Period Ended August 31, 2021** | **Fiscal Year Ended<br> June 30, 2021** | **Fiscal Year Ended<br> June 30, 2020** |
| **Penn Capital Floating Rate Income Fund** | $100770 | $9950 | $138850 | $154271 |
| **Penn Capital Short Duration High Income Fund** | $91037 | $8288 | $94866 | $102030 |
| **Penn Capital Opportunistic High Income Fund** | $75763 | $11839 | $111118 | $113771 |
| **Penn Capital Mid Cap Core Fund** | $36464 | $3525 | $67240 | $63192 |
| **Penn Capital Special Situations Small Cap Equity Fund** | $34681 | $1332 | $67715 | $63403 |

---

**Custodian**

U.S. Bank National Association, an affiliate of Fund Services, is the custodian of the assets of the Funds ("Custodian") pursuant to a custody agreement between the Custodian and the Trust. The Custodian's address is Custody Operations, 1555 North RiverCenter Drive, Suite 302, Milwaukee, Wisconsin 53212. The Custodian and Fund Services are affiliates.

**Codes of Ethics**

The Trust, the Advisor and Foreside Financial Group, LLC, on behalf of the Distributor, have adopted codes of ethics under Rule 17j-1 under the 1940 Act. These codes of ethics permit, subject to certain conditions, personnel of each of those entities to invest in securities that may be purchased or held by a Fund.

**Proxy Voting Guidelines**

The Trust and the Advisor have adopted procedures for voting proxies for equity securities on behalf of the Funds ("Proxy Voting Guidelines"). The Proxy Voting Guidelines are included in <u>Appendix B</u> to this SAI. Information about how the Funds voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 (when available) may be obtained (1) without charge, upon request, by calling 1-844-302-PENN (7366) and (2) on the SEC's website at http://www.sec.gov.

**Valuation of Shares**

Fund shares are sold on a continuous basis at the NAV next computed following acceptance of an order by the Fund. Each Fund's NAV for the purpose of pricing purchase and redemption orders is generally determined at 4:00 p.m., Eastern Standard time on each day the Fund is open as determined by the Board. The Funds are generally open on the same days that the New York Stock Exchange ("NYSE") is open for trading. The NYSE is closed on the following holidays: New Year's Day, Martin Luther King, Jr. Day, Washington's Birthday, Good Friday, Memorial Day, Juneteenth National Independence Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.

A Fund's NAV is calculated by adding the value of all assets of the Fund attributable to that share class, deducting all liabilities attributable to that share class, and dividing by the number of outstanding shares of that share class, the result being adjusted to the nearest cent. Each Fund's daily NAV is available by calling 1-844-302-PENN (7366).

Information about the market value of each portfolio security may be obtained by the Advisor from an approved independent pricing service. The pricing service relies primarily on prices of actual market transactions as well as trader quotations. However, the pricing service may use a matrix system to determine valuations of fixed income securities and bank loans. This system considers such factors as security prices, yields, maturities, call features, ratings and developments relating to specific securities in arriving at valuations. The procedures used by the pricing service and its valuations are reviewed by the officers of the Trust under the general supervision of the Board.

Portfolio securities listed on a national or foreign securities exchange, including those listed on the NASDAQ<sup>®</sup> Stock Market ("NASDAQ<sup>®</sup>"), for which market quotations are available, are valued at the official closing price of such exchange on each business day (defined as days on which the Funds are open for business). If there is no such official closing price on an exchange, the portfolio security will be valued at the most recent quoted bid price. Price information on listed securities is taken from the exchange where the security is primarily traded.

Options contracts listed for trading on a securities exchange or board of trade are valued at the last quoted sales price, or if no sales are reported for exchange-traded options, or the options are not exchange-traded, then they are valued at the most recent quoted bid price. Futures contracts are valued at the daily quoted settlement prices. Other assets and securities for which no quotations are readily available (such as for certain restricted or unlisted securities and private placements) or that may not be reliably priced (such as in the case of trade suspensions or halts, price movement limits set by certain foreign markets, and thinly traded or illiquid investments) will be valued in good faith at fair value using procedures and methods approved by the Board. Under the procedures adopted by the Board, the Board has delegated day-to-day responsibility for fair value determinations to a Valuation Committee comprised of representatives from the Advisor.

**Purchase and Redemption of Shares**

The Prospectus describes the manner in which the Funds' shares may be purchased and redeemed. Shares of each Fund are offered directly to the public by the Distributor.

The purchase and redemption price of shares is the NAV next calculated after receipt of an order in proper form. As described in the Prospectus, financial institutions and intermediaries may purchase or redeem Fund shares on any day that the NYSE is open for business by placing orders with the Funds' transfer agent (or their authorized agent). Institutions and intermediaries that use certain proprietary systems of the Advisor may place orders electronically through those systems. Each Fund reserves the right to refuse any purchase requests, particularly those that the Funds determine would not be in the best interests of the Fund or its shareholders, or that could adversely affect the Fund or its operations.

It is currently the Trust's policy to pay all redemptions in cash. The Trust, however, has filed a notice of election under Rule 18f-1 of the 1940 Act that allows a Fund to redeem in-kind redemption requests of a certain amount. Specifically, if the amount being redeemed is over the lesser of $250,000 or 1% of a Fund's net assets, the Fund has the right to redeem the shares by providing the amount that exceeds $250,000 or 1% of the Fund's net assets in securities instead of cash. Shareholders may incur subsequent brokerage charges on the sale of any such securities so received in payment of redemptions. A gain or loss for federal income tax purposes may be realized by a taxable shareholder upon an in-kind redemption depending upon the shareholder's basis in the shares of the Trust redeemed.

The Trust reserves the right to suspend the right of redemption and/or to postpone the date of payment upon redemption for any period during which trading on the NYSE is restricted, or during the existence of an emergency (as determined by the SEC by rule or regulation) as a result of which disposal or evaluation of the portfolio securities is not reasonably practicable, or for such other periods as the SEC may by order permit. The Trust also reserves the right to suspend sales of shares of the Funds for any period during which the NYSE, the Distributor and/or the Custodian are not open for business.

**Marketing and Support Payments**

From time to time, the Advisor, in its discretion, and out of its own resources and without additional costs to the Funds or shareholders, may provide additional cash payments or other compensation to certain financial intermediaries who sell shares of the Funds. The prospect of receiving additional payments or other compensation may provide those financial intermediaries and/or their salespersons with an incentive to favor sales of the Funds over sales of other mutual funds (or non-mutual fund investments) that do not make such payments. You should consider whether your financial intermediary has such an arrangement with the Funds and whether that creates a significant conflict of interest for your financial intermediary when evaluating any recommendations related to the purchase of Fund shares. Although the Advisor has an incentive to increase assets and receive more advisory fees, the shares purchased by shareholders through financial intermediaries which the Advisor pays revenue sharing are not as profitable to the Advisor as those purchased in direct shareholder accounts.

**Shareholder Servicing Plan**

The Trust has adopted a Shareholder Servicing Plan (the "Servicing Plan") that allows the Funds to pay servicing fees to intermediaries such as banks, broker-dealers, financial advisers or other financial institutions ("Service Organizations") that provide shareholder services ("Shareholder Servicing Activities"). Shareholder Servicing Activities include one or more of the following: (1) establishing and maintaining accounts and records relating to shareholders of the Funds; (2) aggregating and processing orders involving the shares of the Funds and related payments; (3) maintaining and operating websites or other systems through which shareholders access the Funds and receive related services; (4) processing dividend and other distribution payments from the Funds on behalf of shareholders; (5) providing information to shareholders as to their ownership of Fund shares or about other aspects of the operations of the Funds; (6) preparing tax reports or forms on behalf of shareholders; (7) facilitating the transmission of proxy statements, annual and semiannual reports, prospectuses (including summary prospectuses) and other communications from the Funds to shareholders; (8) assisting shareholders in changing the Funds' records as to their addresses, dividend options, account registrations or other data; (9) providing sub-accounting with respect to shares beneficially owned by shareholders, or the information to the Funds necessary for sub-accounting; (10) responding to shareholder inquiries relating to the services performed and other matters pertaining to the Funds; (11) providing shareholders with a service that invests the assets of their accounts in shares pursuant to specific or pre-authorized instructions; (12) receiving, tabulating and transmitting to the Funds proxies executed with respect to special meetings of shareholders of the Funds; (13) assisting in responding to regulatory inquiries regarding shareholders and the Funds; and (14) providing such other related services as the Funds or customers of the intermediary may reasonably request. Under the Servicing Plan, each Fund may pay servicing fees to Service Organizations at an annual rate not to exceed 0.15% of the average daily value of net assets.

To the extent that the costs of the arrangements with the Service Organizations (1) are not paid out of the Servicing Plan or (2) are related to distribution or marketing of a Fund's shares and not paid out of the 12b-1 Plan, the Advisor may make additional payments, out of its own assets, to compensate Service Organizations for these arrangements. These additional payments are sometimes referred to as "revenue sharing" payments. The Advisor may benefit from these arrangements because the increase in the sale of Fund shares will result in an increase in a Fund's assets and consequently an increase in advisory fees. These fees may be in addition to fees paid from a Fund's assets to them or other Service Organizations.

During the following fiscal periods, the Funds paid the following shareholder servicing fees:

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| | | | | |
|:---|:---|:---|:---|:---|
| **Fund** | **Fiscal Year Ended August 31, 2022** | **Fiscal Period Ended August 31, 2021** | **Fiscal Year Ended June 30, 2021** | **Fiscal Year Ended June 30, 2020** |
| **Penn Capital Floating Rate Income Fund** | $0 | $1571 | $20605 | $33956 |
| **Penn Capital Short Duration High Income Fund** | $0 | $0 | $55560 | $42002 |
| **Penn Capital Opportunistic High Income Fund** | $0 | $0 | $8452 | $12709 |

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| | | | | |
|:---|:---|:---|:---|:---|
| **Fund** | **Fiscal Year Ended August 31, 2022** | **Fiscal Period Ended August 31, 2021** | **Fiscal Year Ended June 30, 2021** | **Fiscal Year Ended June 30, 2020** |
| **Penn Capital Mid Cap Core Fund** | $0 | $0 | $7207 | $12063 |
| **Penn Capital Special Situations Small Cap Equity Fund** | $0 | $0 | $16850 | $13203 |

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**Portfolio Transactions**

The Advisor invests Fund assets consistent with a Fund's investment objectives, strategies, policies and restrictions. The Advisor will seek to obtain the best net results taking into account such factors as price (including applicable dealer spread), size, type and difficulty of the transaction involved, the firm's general execution and operational facilities, and the firm's risk in positioning the securities involved.

The Funds have no obligation to deal with any broker-dealer or group of brokers or dealers in the execution of transactions in portfolio securities. The Advisor may, from time to time, direct trades to certain brokers that provide favorable commission rates, consistent with its goal to seek best execution. The Funds will not purchase portfolio securities from any affiliated person acting as principal except in conformity with SEC regulations.

For securities traded in the over-the-counter markets, the Advisor generally deals directly with the dealers who make markets in these securities unless better prices and execution are, in the Advisor's opinion, available elsewhere. The Advisor negotiates commission rates with brokers based on the quality and quantity of services provided in light of generally prevailing rates, and while the Advisor generally seeks reasonably competitive commission rates, a Fund does not necessarily pay the lowest commissions available. The Board periodically reviews the commission rates and the allocation of orders.

Portfolio transactions may be placed with broker-dealers who furnish the Advisor with investment research or services. The commissions on such brokerage transactions with investment research or services may be higher than another broker might have charged for the same transaction in recognition of the value of research or services provided. Such research or services include advice, both orally and in writing, as to: the value of securities; the advisability of investing in, purchasing or selling securities; the availability of securities, or purchasers or sellers of securities; as well as analyses and reports concerning issues, industries, securities, economic factors and trends, portfolio strategy and the performance of accounts. To the extent portfolio transactions are effected with broker-dealers who furnish research and/or other services to the Advisor, the Advisor receives a benefit. Such research or services provided by a broker-dealer through whom the Advisor effects securities transactions for a Fund may be used by the Advisor in servicing all of its accounts. In addition, the Advisor may not use all of the research and services provided by such broker-dealer in connection with the Fund.

The Trust also may enter into arrangements, commonly referred to as "brokerage/service arrangements<u>,</u>" with broker-dealers pursuant to which a broker-dealer agrees to pay the cost of certain products or services provided to the Funds in exchange for fund brokerage. Under a typical brokerage/service arrangement, a broker agrees to pay a portion of a Fund's custodian, administrative or transfer agency fees, and in exchange, the Fund agrees to direct a minimum amount of brokerage to the broker. The Advisor, on behalf of the Trust, usually negotiates the terms of the contract with the service provider, which is paid directly by the broker.

During the fiscal year ended August 31, 2022, the following Funds paid the following brokerage commissions to brokers who also provided research services. The dollar values of the securities traded for the fiscal year ended August 31, 2022 are also shown below:

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| | | |
|:---|:---|:---|
| | **Commissions Paid for Soft-Dollar Arrangements** | **Dollar Value of Securities Traded** |
| **Penn Capital Mid Cap Core Fund** | $10990 | $10956282 |
| **Penn Capital Special Situations Small Cap Equity Fund** | $34154 | $21954169 |

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The same security may be suitable for a Fund, another portfolio series of the Trust or other private accounts managed by the Advisor. If and when a Fund and two or more accounts simultaneously purchase or sell the same security, the transactions will be allocated as to price and amount in accordance with arrangements equitable to the Fund and the accounts. The simultaneous purchase or sale of the same securities by a Fund may negatively affect the price paid or received by the Fund or the size of the position obtainable or able to be sold by the Fund.

During the following fiscal periods, the Funds incurred brokerage commissions as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fiscal Year Ended August 31, 2022** | **Fiscal Period Ended August 31, 2021** | **Fiscal Year Ended June 30, 2021** | **Fiscal Year Ended June 30, 2020** |
| **Penn Capital Floating Rate Income Fund** | $0 | $0 | $0 | $0 |
| **Penn Capital Short Duration High Income Fund** | $0 | $0 | $0 | $0 |
| **Penn Capital Opportunistic High Income Fund** | $0 | $0 | $76 | $220 |
| **Penn Capital Mid Cap Core Fund** | $14597 | $1693 | $12081 | $13084 |
| **Penn Capital Special Situations Small Cap Equity Fund** | $44630 | $6080 | $46435 | $45436 |

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From time to time, a Fund may acquire and hold securities issued by its "regular brokers and dealers" or the parents of those brokers and dealers. For this purpose, regular brokers and dealers are the 10 brokers or dealers that: (1) received the greatest amount of brokerage commissions during a Fund's last fiscal year; (2) engaged in the largest amount of principal transactions for portfolio transactions of a Fund during the Fund's last fiscal year; or (3) sold the largest amount of a Fund's shares during the Fund's last fiscal year. As of the fiscal year ended August 31, 2022, the Funds did not own securities of their "regular brokers or dealers" or their parents.

**Portfolio Turnover**

Although the Funds generally will not invest for short-term trading purposes, portfolio securities may be sold without regard to the length of time they have been held when, in the opinion of the Advisor, investment considerations warrant such action. The portfolio turnover rate is calculated by dividing (1) the lesser of purchases or sales of portfolio securities for the fiscal year by (2) the monthly average of the value of portfolio securities owned during the fiscal year. A 100% turnover rate would occur if all the securities in a Fund's portfolio, with the exception of securities whose maturities at the time of acquisition were one year or less, were sold and either repurchased or replaced within one year. A high rate of portfolio turnover (100% or more) generally leads to higher transaction costs and may result in a greater number of taxable transactions.

**Taxes**

The following summarizes certain tax considerations generally affecting the Funds, the underlying investment companies, and Fund shareholders that are not fully described in the Prospectus. No attempt is made to present a detailed explanation of the tax treatment of the Funds, the underlying investment companies, or Fund shareholders, and the discussions here and in the Prospectus are not intended as a substitute for careful tax planning. Potential investors should consult their tax advisers with specific reference to their own tax situations.

The discussions of the federal tax consequences in the Prospectus and this SAI are based on the Internal Revenue Code (the "Code") and the regulations issued under it, and court decisions and administrative interpretations, as in effect on the date of this SAI. Future legislative or administrative changes or court decisions may significantly alter the statements included herein, and any such changes or decisions may be retroactive.

**General**

Each Fund and each underlying investment company intends to qualify as a regulated investment company under Subchapter M of Subtitle A, Chapter 1, of the Code. As such, each Fund and underlying investment company generally will be exempt from federal income tax on its net investment income and realized capital gains that it distributes to shareholders. To qualify for treatment as a regulated investment company, each Fund and underlying investment company must meet three important tests each year.

First, each Fund and underlying investment company must derive with respect to each taxable year at least 90% of its gross income from dividends, interest, certain payments with respect to securities loans, gains from the sale or other disposition of stock or securities or foreign currencies, other income derived with respect to its business of investing in such stock, securities, or currencies or net income derived from interests in qualified publicly traded partnerships.

Second, generally, at the close of each quarter of each Fund's and each underlying investment company's taxable year, at least 50% of the value of the Fund's and the underlying investment companies' assets must consist of cash and cash items, U.S. government securities, securities of other regulated investment companies and securities of other issuers (as to which the Fund or underlying investment company has not invested more than 5% of the value of its total assets in securities of such issuer and as to which the Fund or underlying investment company does not hold more than 10% of the outstanding voting securities of such issuer), and no more than 25% of the value of each Fund's and each underlying investment company's total assets may be invested in the securities of (1) any one issuer (other than U.S. government securities and securities of other regulated investment companies), (2) two or more issuers that the Fund or underlying investment company controls and which are engaged in the same or similar trades or businesses, or (3) one or more qualified publicly traded partnerships.

Third, each Fund and underlying investment company must distribute an amount equal to at least the sum of 90% of the Fund's or underlying investment company's investment company taxable income (net investment income and the excess of net short-term capital gain over net long-term capital loss) before taking into account any deduction for dividends paid, and 90% of its tax-exempt income, if any, for the year.

Each Fund and underlying investment company intends to comply with these requirements. If a Fund or underlying investment company were to fail to make sufficient distributions, it could be liable for corporate income tax and for excise tax in respect of the shortfall or, if the shortfall is large enough, the Fund or underlying investment company could be disqualified as a regulated investment company. If for any taxable year a Fund or underlying investment company were not to qualify as a regulated investment company, all its taxable income would be subject to tax at regular corporate rates without any deduction for distributions to shareholders. In that event, shareholders in a Fund or underlying investment company would recognize dividend income on distributions to the extent of the Fund's or underlying investment company's current and accumulated earnings and profits, and corporate shareholders could be eligible for the dividends-received deduction.

The Code imposes a nondeductible 4% excise tax on regulated investment companies that fail to distribute each year an amount equal to specified percentages of their ordinary taxable income and capital gain net income (excess of capital gains over capital losses). Each Fund and underlying investment company intends to make sufficient distributions or deemed distributions each year to avoid liability for this excise tax.

As of August 31, 2022, the Penn Capital Floating Income Rate Fund had $2,219,186 of short-term capital loss carryforwards and $1,256,625 of long-term capital loss carryforwards, the Penn Capital Opportunistic High Income Fund had $664,563 of short-term capital loss carryforwards, and $389,898 of long-term capital loss carryforwards, and the Penn Capital Short Duration High Income Fund had $1,941,966 of short-term capital loss carryforwards.

**Taxation of Certain Investments**

The tax principles applicable to transactions in financial instruments, such as futures contracts and options, that may be engaged in by a Fund or an underlying investment company, and investments in passive foreign investment companies ("PFICs"), are complex and, in some cases, uncertain. Such transactions and investments may cause a Fund or an underlying investment company to recognize taxable income prior to the receipt of cash, thereby requiring the Fund or the underlying investment company to liquidate other positions, or to borrow money, so as to make sufficient distributions to shareholders to avoid corporate-level tax. Moreover, some or all of the taxable income recognized may be ordinary income or short-term capital gain, so that the distributions may be taxable to shareholders as ordinary income.

In addition, in the case of any shares of a PFIC in which a Fund or an underlying investment company invests, the Fund or the underlying investment company may be liable for corporate-level tax on any ultimate gain or distributions on the shares if the Fund or the underlying investment company fails to make an election to recognize income annually during the period of its ownership of the shares.

**State and Local Taxes**

Although each Fund and underlying investment company expects to qualify as a regulated investment company and to be relieved of all or substantially all federal income taxes, depending upon the extent of its activities in states and localities in which its offices are maintained, in which its agents or independent contractors are located or in which it is otherwise deemed to be conducting business, a Fund or an underlying investment company may be subject to the tax laws of such states or localities.

**Independent Registered Public Accounting Firm**

Tait, Weller & Baker LLP, Two Liberty Place, 50 South 16th Street, Suite 2900, Philadelphia, Pennsylvania 19102, serves as the Funds' independent registered public accounting firm, whose services include an audit of the Funds' financial statements and the performance of related tax services.

**Legal Counsel**

Faegre Drinker Biddle & Reath LLP, One Logan Square, Suite 2000, Philadelphia, Pennsylvania 19103, serves as the Funds' legal counsel.

**Financial Statements**

The financial statements for the Penn Capital Floating Rate Income Fund, the Penn Capital Short Duration High Income Fund, the Penn Capital Opportunistic High Income Fund, the Penn Capital Mid Cap Core Fund and the Penn Capital Special Situations Small Cap Equity Fund, and the report of Tait, Weller & Baker LLP, the Funds' independent registered public accounting firm, thereon for the fiscal year ended August 31, 2022, are incorporated by reference into this Statement of Additional Information. The Funds will provide a copy of the Funds' annual and semi-annual reports, on request and without charge. You may request a copy of the annual and semi-annual reports at no charge by calling 1-844-302-PENN (7366).

**<u>APPENDIX A</u>**

**DESCRIPTION OF SECURITIES RATINGS**

**<u>Short-Term Credit Ratings</u>**

An ***S&P Global Ratings*** short-term issue credit rating is generally assigned to those obligations considered short-term in the relevant market. The following summarizes the rating categories used by S&P Global Ratings for short-term issues:

"A-1" – A short-term obligation rated "A-1" is rated in the highest category by S&P Global Ratings. The obligor's capacity to meet its financial commitments on the obligation is strong. Within this category, certain obligations are designated with a plus sign (+). This indicates that the obligor's capacity to meet its financial commitment on these obligations is extremely strong.

"A-2" – A short-term obligation rated "A-2" is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor's capacity to meet its financial commitments on the obligation is satisfactory.

"A-3" – A short-term obligation rated "A-3" exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to weaken an obligor's capacity to meet its financial commitments on the obligation.

"B" – A short-term obligation rated "B" is regarded as vulnerable and has significant speculative characteristics. The obligor currently has the capacity to meet its financial commitments; however, it faces major ongoing uncertainties that could lead to the obligor's inadequate capacity to meet its financial commitments.

"C" – A short-term obligation rated "C" is currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitments on the obligation.

"D" – A short-term obligation rated "D" is in default or in breach of an imputed promise. For non-hybrid capital instruments, the "D" rating category is used when payments on an obligation are not made on the date due, unless S&P Global Ratings believes that such payments will be made within any stated grace period. However, any stated grace period longer than five business days will be treated as five business days. The "D" rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action and where default on an obligation is a virtual certainty, for example due to automatic stay provisions. A rating on an obligation is lowered to "D" if it is subject to a distressed debt restructuring.

Local Currency and Foreign Currency Ratings – S&P Global Ratings' issuer credit ratings make a distinction between foreign currency ratings and local currency ratings. A foreign currency rating on an issuer can differ from the local currency rating on it when the obligor has a different capacity to meet its obligations denominated in its local currency, versus obligations denominated in a foreign currency.

"NR" – This indicates that a rating has not been assigned or is no longer assigned.

***Moody's Investors Service ("Moody's")*** short-term ratings are forward-looking opinions of the relative credit risks of financial obligations with an original maturity of thirteen months or less and reflect both on the likelihood of a default or impairment on contractual financial obligations and the expected financial loss suffered in the event of default or impairment.

Moody's employs the following designations to indicate the relative repayment ability of rated issuers:

"P-1" – Issuers (or supporting institutions) rated Prime-1 reflect a superior ability to repay short-term obligations.

"P-2" – Issuers (or supporting institutions) rated Prime-2 reflect a strong ability to repay short-term obligations.

"P-3" – Issuers (or supporting institutions) rated Prime-3 reflect an acceptable ability to repay short-term obligations.

"NP" – Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime rating categories.

"NR" – Is assigned to an unrated issuer, obligation and/or program.

***Fitch, Inc. / Fitch Ratings Ltd. ("Fitch")*** short-term issuer or obligation rating is based in all cases on the short-term vulnerability to default of the rated entity and relates to the capacity to meet financial obligations in accordance with the documentation governing the relevant obligation. Short-term deposit ratings may be adjusted for loss severity. Short-term ratings are assigned to obligations whose initial maturity is viewed as "short-term" based on market convention.<sup>1</sup> Typically, this means up to 13 months for corporate, sovereign, and structured obligations and up to 36 months for obligations in U.S. public finance markets. The following summarizes the rating categories used by Fitch for short-term obligations:

"F1" – Securities possess the highest short-term credit quality. This designation indicates the strongest intrinsic capacity for timely payment of financial commitments; may have an added "+" to denote any exceptionally strong credit feature.

"F2" – Securities possess good short-term credit quality. This designation indicates good intrinsic capacity for timely payment of financial commitments.

<sub>1</sub> A long-term rating can also be used to rate an issue with short maturity.

"F3" – Securities possess fair short-term credit quality. This designation indicates that the intrinsic capacity for timely payment of financial commitments is adequate.

"B" – Securities possess speculative short-term credit quality. This designation indicates minimal capacity for timely payment of financial commitments, plus heightened vulnerability to near term adverse changes in financial and economic conditions.

"C" – Securities possess high short-term default risk. Default is a real possibility.

"RD" – Restricted default. Indicates an entity that has defaulted on one or more of its financial commitments, although it continues to meet other financial obligations. Typically applicable to entity ratings only.

"D" – Default. Indicates a broad-based default event for an entity, or the default of a short-term obligation.

"NR" – Is assigned to an issue of a rated issuer that are not and have not been rated.

The ***DBRS Morningstar® Ratings Limited ("DBRS Morningstar")*** short-term obligation ratings provide DBRS Morningstar's opinion on the risk that an issuer will not meet its short-term financial obligations in a timely manner. The obligations rated in this category typically have a term of shorter than one year. The R-1 and R-2 rating categories are further denoted by the subcategories "(high)", "(middle)", and "(low)".

The following summarizes the ratings used by DBRS Morningstar for commercial paper and short-term debt:

"R-1 (high)" - Short-term debt rated "R-1 (high)" is of the highest credit quality. The capacity for the payment of short-term financial obligations as they fall due is exceptionally high. Unlikely to be adversely affected by future events.

"R-1 (middle)" – Short-term debt rated "R-1 (middle)" is of superior credit quality. The capacity for the payment of short-term financial obligations as they fall due is very high. Differs from "R-1 (high)" by a relatively modest degree. Unlikely to be significantly vulnerable to future events.

"R-1 (low)" – Short-term debt rated "R-1 (low)" is of good credit quality. The capacity for the payment of short-term financial obligations as they fall due is substantial. Overall strength is not as favorable as higher rating categories. May be vulnerable to future events, but qualifying negative factors are considered manageable.

"R-2 (high)" – Short-term debt rated "R-2 (high)" is considered to be at the upper end of adequate credit quality. The capacity for the payment of short-term financial obligations as they fall due is acceptable. May be vulnerable to future events.

"R-2 (middle)" – Short-term debt rated "R-2 (middle)" is considered to be of adequate credit quality. The capacity for the payment of short-term financial obligations as they fall due is acceptable. May be vulnerable to future events or may be exposed to other factors that could reduce credit quality.

"R-2 (low)" – Short-term debt rated "R-2 (low)" is considered to be at the lower end of adequate credit quality. The capacity for the payment of short-term financial obligations as they fall due is acceptable. May be vulnerable to future events. A number of challenges are present that could affect the issuer's ability to meet such obligations.

"R-3" – Short-term debt rated "R-3" is considered to be at the lowest end of adequate credit quality. There is a capacity for the payment of short-term financial obligations as they fall due. May be vulnerable to future events and the certainty of meeting such obligations could be impacted by a variety of developments.

"R-4" – Short-term debt rated "R-4" is considered to be of speculative credit quality. The capacity for the payment of short-term financial obligations as they fall due is uncertain.

"R-5" – Short-term debt rated "R-5" is considered to be of highly speculative credit quality. There is a high level of uncertainty as to the capacity to meet short-term financial obligations as they fall due.

"D" – Short-term debt rated "D" is assigned when the issuer has filed under any applicable bankruptcy, insolvency or winding-up statute or there is a failure to satisfy an obligation after the exhaustion of grace periods. DBRS Morningstar may also use "SD" (Selective Default) in cases where only some securities are impacted, such as the case of a "distressed exchange".

**<u>Long-Term Issue Credit Ratings</u>**

The following summarizes the ratings used by ***S&P Global Ratings*** for long-term issues:

"AAA" – An obligation rated "AAA" has the highest rating assigned by S&P Global Ratings. The obligor's capacity to meet its financial commitments on the obligation is extremely strong.

"AA" – An obligation rated "AA" differs from the highest-rated obligations only to a small degree. The obligor's capacity to meet its financial commitments on the obligation is very strong.

"A" – An obligation rated "A" is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories. However, the obligor's capacity to meet its financial commitments on the obligation is still strong.

"BBB" – An obligation rated "BBB" exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to weaken the obligor's capacity to meet its financial commitments on the obligation.

"BB," "B," "CCC," "CC" and "C" – Obligations rated "BB," "B," "CCC," "CC" and "C" are regarded as having significant speculative characteristics. "BB" indicates the least degree of speculation and "C" the highest. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposure to adverse conditions.

"BB" – An obligation rated "BB" is less vulnerable to nonpayment than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions that could lead to the obligor's inadequate capacity to meet its financial commitments on the obligation.

"B" – An obligation rated "B" is more vulnerable to nonpayment than obligations rated "BB", but the obligor currently has the capacity to meet its financial commitments on the obligation. Adverse business, financial, or economic conditions will likely impair the obligor's capacity or willingness to meet its financial commitments on the obligation.

"CCC" – An obligation rated "CCC" is currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitments on the obligation. In the event of adverse business, financial, or economic conditions, the obligor is not likely to have the capacity to meet its financial commitments on the obligation.

"CC" – An obligation rated "CC" is currently highly vulnerable to nonpayment. The "CC" rating is used when a default has not yet occurred but S&P Global Ratings expects default to be a virtual certainty, regardless of the anticipated time to default.

"C" – An obligation rated "C" is currently highly vulnerable to nonpayment, and the obligation is expected to have lower relative seniority or lower ultimate recovery compared with obligations that are rated higher.

"D" – An obligation rated "D" is in default or in breach of an imputed promise. For non-hybrid capital instruments, the "D" rating category is used when payments on an obligation are not made on the date due, unless S&P Global Ratings believes that such payments will be made within the next five business days in the absence of a stated grace period or within the earlier of the stated grace period or the next 30 calendar days. The "D" rating also will be used upon the filing of a bankruptcy petition or the taking of similar action and where default on an obligation is a virtual certainty, for example due to automatic stay provisions. A rating on an obligation is lowered to "D" if it is subject to a distressed debt restructuring

Plus (+) or minus (-) – Ratings from "AA" to "CCC" may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the rating categories.

"NR" – This indicates that a rating has not been assigned, or is no longer assigned.

Local Currency and Foreign Currency Ratings - S&P Global Ratings' issuer credit ratings make a distinction between foreign currency ratings and local currency ratings. A foreign currency rating on an issuer can differ from the local currency rating on it when the obligor has a different capacity to meet its obligations denominated in its local currency, versus obligations denominated in a foreign currency.

***Moody's*** long-term ratings are forward-looking opinions of the relative credit risks of financial obligations with an original maturity of eleven months or more. Such ratings reflect both on the likelihood of default or impairment on contractual financial obligations and the expected financial loss suffered in the event of default or impairment. The following summarizes the ratings used by Moody's for long-term debt:

"Aaa" – Obligations rated "Aaa" are judged to be of the highest quality, subject to the lowest level of credit risk.

"Aa" – Obligations rated "Aa" are judged to be of high quality and are subject to very low credit risk.

"A" – Obligations rated "A" are judged to be upper-medium grade and are subject to low credit risk.

"Baa" – Obligations rated "Baa" are judged to be medium-grade and subject to moderate credit risk and as such may possess certain speculative characteristics.

"Ba" – Obligations rated "Ba" are judged to be speculative and are subject to substantial credit risk.

"B" – Obligations rated "B" are considered speculative and are subject to high credit risk.

"Caa" – Obligations rated "Caa" are judged to be speculative of poor standing and are subject to very high credit risk.

"Ca" – Obligations rated "Ca" are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.

"C" – Obligations rated "C" are the lowest rated and are typically in default, with little prospect for recovery of principal or interest.

Note: Moody's appends numerical modifiers 1, 2, and 3 to each generic rating classification from "Aa" through "Caa." The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.

"NR" – Is assigned to unrated obligations, obligation and/or program.

The following summarizes long-term ratings used by ***Fitch***:

"AAA" – Securities considered to be of the highest credit quality. "AAA" ratings denote the lowest expectation of credit risk. They are assigned only in cases of exceptionally strong capacity for payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.

"AA" – Securities considered to be of very high credit quality. "AA" ratings denote expectations of very low credit risk. They indicate very strong capacity for payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.

"A" – Securities considered to be of high credit quality. "A" ratings denote expectations of low credit risk. The capacity for payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to adverse business or economic conditions than is the case for higher ratings.

"BBB" – Securities considered to be of good credit quality. "BBB" ratings indicate that expectations of credit risk are currently low. The capacity for payment of financial commitments is considered adequate, but adverse business or economic conditions are more likely to impair this capacity.

"BB" – Securities considered to be speculative. "BB" ratings indicates an elevated vulnerability to credit risk, particularly in the event of adverse changes in business or economic conditions over time; however, business or financial alternatives may be available to allow financial commitments to be met.

"B" – Securities considered to be highly speculative. "B" ratings indicate that material credit risk is present

"CCC" – A "CCC" rating indicates that substantial credit risk is present.

"CC" – A "CC" rating indicates very high levels of credit risk.

"C" – A "C" rating indicates exceptionally high levels of credit risk.

Defaulted obligations typically are not assigned "RD" or "D" ratings but are instead rated in the "CCC" to "C" rating categories, depending on their recovery prospects and other relevant characteristics. Fitch believes that this approach better aligns obligations that have comparable overall expected loss but varying vulnerability to default and loss.

Plus (+) or minus (-) may be appended to a rating to denote relative status within major rating categories. Such suffixes are not added to the "AAA" obligation rating category, or to corporate finance obligation ratings in the categories below "CCC".

"NR" – Is assigned to an unrated issue of a rated issuer.

The ***DBRS*** Morningstar long-term obligation ratings provide DBRS Morningstar's opinion on the risk that investors may not be repaid in accordance with the terms under which the long-term obligation was issued. The obligations rated in this category typically have a term of one year or longer. All rating categories other than AAA and D also contain subcategories "(high)" and "(low)". The absence of either a "(high)" or "(low)" designation indicates the rating is in the middle of the category. The following summarizes the ratings used by DBRS Morningstar for long-term debt:

"AAA" – Long-term debt rated "AAA" is of the highest credit quality. The capacity for the payment of financial obligations is exceptionally high and unlikely to be adversely affected by future events.

"AA" – Long-term debt rated "AA" is of superior credit quality. The capacity for the payment of financial obligations is considered high. Credit quality differs from "AAA" only to a small degree. Unlikely to be significantly vulnerable to future events.

"A" – Long-term debt rated "A" is of good credit quality. The capacity for the payment of financial obligations is substantial, but of lesser credit quality than "AA." May be vulnerable to future events, but qualifying negative factors are considered manageable.

"BBB" – Long-term debt rated "BBB" is of adequate credit quality. The capacity for the payment of financial obligations is considered acceptable. May be vulnerable to future events.

"BB" – Long-term debt rated "BB" is of speculative, non-investment grade credit quality. The capacity for the payment of financial obligations is uncertain. Vulnerable to future events.

"B" – Long-term debt rated "B" is of highly speculative credit quality. There is a high level of uncertainty as to the capacity to meet financial obligations.

"CCC", "CC" and "C" – Long-term debt rated in any of these categories is of very highly speculative credit quality. In danger of defaulting on financial obligations. There is little difference between these three categories, although "CC" and "C" ratings are normally applied to obligations that are seen as highly likely to default or subordinated to obligations rated in the "CCC" to "B" range. Obligations in respect of which default has not technically taken place but is considered inevitable may be rated in the "C" category.

"D" – A security rated "D" is assigned when the issuer has filed under any applicable bankruptcy, insolvency or winding up statute or there is a failure to satisfy an obligation after the exhaustion of grace periods. DBRS Morningstar may also use "SD" (Selective Default) in cases where only some securities are impacted, such as the case of a "distressed exchange".

**<u>Municipal Note Ratings</u>**

An ***S&P Global Ratings*** U.S. municipal note rating reflects S&P Global Ratings' opinion about the liquidity factors and market access risks unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with an original maturity of more than three years will most likely receive a long-term debt rating. In determining which type of rating, if any, to assign, S&P Global Ratings' analysis will review the following considerations:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;●&nbsp;&nbsp;&nbsp;&nbsp; Amortization schedule - the larger the final maturity relative to other maturities, the more likely it will be treated as a note; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● &nbsp;&nbsp;&nbsp;&nbsp; Source of payment - the more dependent the issue is on the market for its refinancing, the more likely it will be treated as a note.

Municipal Short-Term Note rating symbols are as follows:

"SP-1" – A municipal note rated "SP-1" exhibits a strong capacity to pay principal and interest. An issue determined to possess a very strong capacity to pay debt service is given a plus (+) designation.

"SP-2" – A municipal note rated "SP-2" exhibits a satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and economic changes over the term of the notes.

"SP-3" – A municipal note rated "SP-3" exhibits a speculative capacity to pay principal and interest.

"D" – This rating is assigned upon failure to pay the note when due, completion of a distressed debt restructuring, or the filing of a bankruptcy petition or the taking of similar action and where default on an obligation is a virtual certainty, for example due to automatic stay provisions.

***Moody's*** uses the global short-term Prime rating scale (listed above under Short-Term Credit Ratings) for commercial paper issued by U.S. municipalities and nonprofits. These commercial paper programs may be backed by external letters of credit or liquidity facilities, or by an issuer's self-liquidity.

For other short-term municipal obligations, Moody's uses one of two other short-term rating scales, the Municipal Investment Grade ("MIG") and Variable Municipal Investment Grade ("VMIG") scales provided below.

Moody's uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and certain other short-term obligations, which typically mature in three years or less. Under certain circumstances, Moody's uses the MIG scale for bond anticipation notes with maturities of up to five years.

MIG Scale

"MIG-1" – This designation denotes superior credit quality. Excellent protection is afforded by established cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market for refinancing.

"MIG-2" – This designation denotes strong credit quality. Margins of protection are ample, although not as large as in the preceding group.

"MIG-3" – This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be narrow, and market access for refinancing is likely to be less well-established.

"SG" – This designation denotes speculative-grade credit quality. Debt instruments in this category may lack sufficient margins of protection.

"NR" – Is assigned to an unrated obligation, obligation and/or program.

In the case of variable rate demand obligations ("VRDOs"), a two-component rating is assigned. The components are a long-term rating and a short-term demand obligation rating. The long-term rating addresses the issuer's ability to meet scheduled principal and interest payments. The short-term demand obligation rating addresses the ability of the issuer or the liquidity provider to make payments associated with the purchase-price-upon demand feature ("demand feature") of the VRDO. The short-term demand obligation rating uses the VMIG scale. VMIG ratings with liquidity support use as an input the short-term Counterparty Risk Assessment of the support provider, or the long-term rating of the underlying obligor in the absence of third party liquidity support. Transitions of VMIG ratings of demand obligations with conditional liquidity support differ from transitions on the Prime scale to reflect the risk that external liquidity support will terminate if the issuer's long-term rating drops below investment grade.

Moody's typically assigns the VMIG short-term demand obligation rating if the frequency of the demand feature is less than every three years. If the frequency of the demand feature is less than three years but the purchase price is payable only with remarketing proceeds, the short-term demand obligation rating is "NR".

"VMIG-1" – This designation denotes superior credit quality. Excellent protection is afforded by the superior short-term credit strength of the liquidity provider and structural and legal protections.

"VMIG-2" – This designation denotes strong credit quality. Good protection is afforded by the strong short-term credit strength of the liquidity provider and structural and legal protections.

"VMIG-3" – This designation denotes acceptable credit quality. Adequate protection is afforded by the satisfactory short-term credit strength of the liquidity provider and structural and legal protections.

"SG" – This designation denotes speculative-grade credit quality. Demand features rated in this category may be supported by a liquidity provider that does not have a sufficiently strong short-term rating or may lack the structural and/or legal protections.

"NR" – Is assigned to an unrated obligation, obligation and/or program.

**<u>About Credit Ratings</u>**

An ***S&P Global Ratings*** issue credit rating is a forward-looking opinion about the creditworthiness of an obligor with respect to a specific financial obligation, a specific class of financial obligations, or a specific financial program (including ratings on medium-term note programs and commercial paper programs). It takes into consideration the creditworthiness of guarantors, insurers, or other forms of credit enhancement on the obligation and takes into account the currency in which the obligation is denominated. The opinion reflects S&P Global Ratings' view of the obligor's capacity and willingness to meet its financial commitments as they come due, and this opinion may assess terms, such as collateral security and subordination, which could affect ultimate payment in the event of default.

Ratings assigned on ***Moody's*** global long-term and short-term rating scales are forward-looking opinions of the relative credit risks of financial obligations issued by non-financial corporates, financial institutions, structured finance vehicles, project finance vehicles, and public sector entities.

***Fitch's*** credit ratings are forward-looking opinions on the relative ability of an entity or obligation to meet financial commitments. Issuer Default Ratings (IDRs) are assigned to corporations, sovereign entities, financial institutions such as banks, leasing companies and insurers, and public finance entities (local and regional governments). Issue-level ratings are also assigned and often include an expectation of recovery, which may be notched above or below the issuer-level rating. Issue ratings are assigned to secured and unsecured debt securities, loans, preferred stock and other instruments. Credit ratings are indications of the likelihood of repayment in accordance with the terms of the issuance. In limited cases, Fitch may include additional considerations (i.e., rate to a higher or lower standard than that implied in the obligation's documentation).

***DBRS Morningstar*** offers independent, transparent, and innovative credit analysis to the market. Credit ratings are forward-looking opinions about credit risk that reflect the creditworthiness of an issuer, rated entity, security and/or obligation based on DBRS Morningstar's quantitative and qualitative analysis in accordance with applicable methodologies and criteria. They are meant to provide opinions on relative measures of risk and are not based on expectations of, or meant to predict, any specific default probability. Credit ratings are not statements of fact. DBRS Morningstar issues credit ratings using one or more categories, such as public, private, provisional, final(ized), solicited, or unsolicited. From time to time, credit ratings may also be subject to trends, placed under review, or discontinued. DBRS Morningstar credit ratings are determined by credit rating committees.

**APPENDIX B**

The following information is a summary of the proxy voting guidelines for the Advisor

**Penn Capital Management Company, LLC**

**Introduction**

Penn Capital has adopted and implemented policies and procedures that are reasonably designed to ensure that proxies are voted in the economic interest of its clients.

This policy sets forth the guidelines that Penn Capital uses in voting specific proposals presented by the boards of directors or shareholders of companies whose securities are held in client portfolios.

**How Advisor Votes Proxies**

For clients that give us authority to vote proxies, we have the ability to tailor voting. We vote proxies based on a client's instruction or a client's legal structure, such as an ERISA pension plan. Absent legal structure considerations or specific instructions, clients' proxies are voted in accordance with what Penn Capital believes is in the economic interest of the shareholders, in consultation with our proxy research provider, as described below. Additionally, some clients contractually reserve the right to vote their own proxies or contractually direct us to vote their proxies in a certain manner.

We utilize the services of the research firm of Glass Lewis & Co. ("Glass Lewis") to provide proxy research and voting recommendations. Recommendations are based on objective analysis. Penn Capital does not consider recommendations from Glass Lewis to be determinative of its ultimate decision. Rather, Penn Capital exercises its independent judgment in making voting decisions and reserves the right to vote contrary to Glass Lewis recommendations in the event that Penn Capital determines that it is in the client's interest.

We utilize the services of the Proxy Edge automated voting system provided by Broadridge to electronically vote ballots. Broadridge notifies Penn Capital in advance of the board meetings, provides the appropriate proxies to be voted, and maintains records of proxy statements received and votes cast.

**Proxy Voting Guidelines**

The following Glass Lewis guidelines have been adopted by Penn Capital to objectively evaluate proxy votes that are in the economic interest of our clients. These guidelines are not an exhaustive list of all the issues that may arise and Penn Capital cannot anticipate all future situations. In all cases, each proxy will be considered based on the relevant facts and circumstances.

&nbsp;&nbsp;&nbsp;&nbsp;1. *Board of Directors*: The election of directors and an independent board is important to
 ethical and effective corporate governance. Directors are expected to be competent individuals
 and they should be accountable and responsive to shareholders. Advisor supports an independent
 board of directors, and prefers that key committees such as audit, nominating, and compensation
 committees be comprised of independent directors. Advisor generally votes against management
 efforts to classify a board and generally supports proposals to declassify the board
 of directors. Advisor considers withholding votes from directors with an unsatisfactory
 attendance record. While generally in favor of separating Chairman and CEO positions,
 Advisor will review this issue on a case-by-case basis, considering other factors, including
 the company's corporate governance guidelines and performance. Advisor evaluates
 proposals to restore or provide for cumulative voting on a case-by-case basis and considers
 such factors as corporate governance provisions as well as relative performance.

&nbsp;&nbsp;&nbsp;&nbsp;2. *Ratification of Auditors*: In light of several high profile accounting scandals, Glass Lewis closely
 scrutinizes the role and performance of auditors. On a case-by-case basis, Glass Lewis
 examines proposals relating to non-audit relationships and non-audit fees. Glass Lewis
 considers, on a case-by-case basis, proposals to rotate auditors, and votes against the
 ratification of auditors when there is clear and compelling evidence of accounting irregularities
 or negligence attributable to the auditors.

&nbsp;&nbsp;&nbsp;&nbsp;3. *Management & Director Compensation*: A company's equity-based compensation plan should
 align with the shareholders' long-term interests. Glass Lewis evaluates plans on
 a case-by-case basis by considering several factors to determine whether the plan is
 fair and reasonable. Advisor generally opposes plans that have the potential to be excessively
 dilutive. The Advisor generally supports employee stock option plans. Severance compensation
 arrangements are reviewed on a case-by-case basis, although Advisor generally opposes
 "golden parachutes" that are considered excessive. Advisor normally supports
 proposals that require a percentage of director compensation be in the form of common
 stock, as it aligns their interests with those of the shareholders. Advisor reviews on
 a case-by-case basis any shareholder proposals to adopt policies on expensing stock option
 plans, and continues to monitor future developments in this area.

&nbsp;&nbsp;&nbsp;&nbsp;4. *Anti-Takeover Mechanisms and Related Issues*: Advisor generally opposes anti-takeover measures since
 they tend to reduce shareholder rights. However, as with all proxy issues, Glass Lewis
 conducts an independent review of each anti-takeover proposal. Occasionally, Advisor
 may vote with management when the research analyst has concluded that the proposal is
 not onerous and would not harm Client interests as stockholders. Advisor generally supports
 proposals that require shareholder rights plans ("poison pills") to be subject
 to a shareholder vote. Advisor evaluates shareholder rights' plans on a case-by-case
 basis to determine whether they warrant support. Advisor generally votes against any
 proposal to issue stock that has unequal or subordinate voting rights. Additionally,
 Advisor generally opposes any supermajority voting requirements as well as the payment
 of "greenmail." Advisor usually supports "fair price" provisions
 and confidential voting.

&nbsp;&nbsp;&nbsp;&nbsp;5. *Changes to Capital Structure*: Advisor realizes that a company's financing decisions
 significantly impact its shareholders, particularly when they involve the issuance of
 additional shares of common or preferred stock or the assumption of additional debt.
 Glass Lewis will carefully review, on a case-by-case basis, proposals by companies to
 increase authorized shares and the purpose for the increase. Advisor generally votes
 against dual-class capital structures to increase the number of authorized shares where
 that class of stock would have superior voting rights. Advisor generally votes in favor
 of the issuance of preferred stock in cases where the company specifies the voting, dividend,
 conversion and other rights of such stock and the terms of the preferred stock issuance
 are deemed reasonable. Glass Lewis reviews proposals seeking preemptive rights on a case-by-case
 basis.

&nbsp;&nbsp;&nbsp;&nbsp;6. *Social and Corporate Policy Issues*: As a fiduciary, Advisor is primarily concerned about
 the financial interests of its Clients. Advisor generally gives management discretion
 with regard to social, environmental and ethical issues, although Advisor may vote in
 favor of those issues that are believed to have significant economic benefits or implications.

**Responsibility and Oversight**

Penn Capital has established a Proxy Voting Committee, which is responsible for the review and approval of the firm's written Proxy Policy procedures and guidelines. The firm's Chief Compliance Officer monitors regulatory developments with respect to proxy voting and works with the Proxy Voting Committee to develop policies that implement those requirements. Daily administration of the proxy voting process is the responsibility of the Portfolio Accounting department.

Penn Capital will generally attempt to process every proxy it receives for all domestic and foreign securities. However, there may be situations in which Penn Capital may be unable to vote a proxy, or may choose not to vote a proxy, such as where: (i) the proxy ballot was not received from the custodian bank; (ii) a meeting notice was received too late; (iii) there are fees imposed upon the exercise of a vote and it is determined that such fees outweigh the benefit of voting; (iv) there are legal encumbrances to voting, including blocking restrictions in certain markets that preclude the ability to dispose of a security if Penn Capital votes a proxy or where Penn Capital is prohibited from voting by applicable law or other regulatory or market requirements, including but not limited to, effective powers of attorney; (v) Penn Capital held shares on the record date but has sold them prior to the meeting date; (vi) proxy voting service is not offered by the custodian in the market; (vii) Penn Capital believes it is not in the best interest of a Fund or its shareholders to vote the proxy for any other reason not enumerated herein; or (viii) a security is subject to a securities lending or similar program that has transferred legal title to the security to another person. In some foreign jurisdictions, even if Penn Capital uses reasonable efforts to vote a proxy on behalf of a Fund, such vote or proxy may be rejected because of (a) operational or procedural issues experienced by one or more third parties involved in voting proxies in such jurisdictions; (b) changes in the process or agenda for the meeting by the issuer for which Penn Capital does not have sufficient notice; and (c) the exercise by the issuer of its discretion to reject the vote of Penn Capital.

**Conflicts of Interest**

Conflicts of interest will be resolved in favor of the clients' interests. The CCO is responsible for resolving potential conflicts of interest in the proxy voting process. Examples of potential conflicts of interest include:

&nbsp;&nbsp;&nbsp;&nbsp;1. Advisor
 or principals have a business or personal relationship with participants in a proxy contest,
 corporate directories or candidates for directorships;

&nbsp;&nbsp;&nbsp;&nbsp;2. The
 Advisor or principals have a material business relationship with a proponent of a proxy
 proposal and this business relationship may influence how the proxy vote is cast.

When a potential material conflict of interest exists, Penn Capital will obtain Client consent before voting. Penn Capital will provide the Client with sufficient information regarding the shareholder vote and the Advisor's potential conflict, so the Client can make an informed decision whether to consent.