Shareholder Letter

April 20, 2020

Dear Shareholder,

During the first quarter of 2020, the Osterweis Fund (the Fund) generated a total return of -16.16% outperforming the -19.60% return for the S&P 500 Index (the S&P 500). The Fund’s annualized total returns over the one-year, five-year, ten-year and twenty-year periods ending March 31, 2020 were -2.88%, 2.21%, 6.83% and 5.45%, respectively, compared to -6.98%, 6.73%, 10.53% and 4.79% for the S&P 500 over the same periods.

Performance data quoted represent past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be higher or lower than the performance quoted. Performance data current to the most recent month end may be obtained by calling (866) 236-0050. An investment should not be made solely on returns. The Fund’s gross expense ratio was 1.18% and net expense ratio was 0.96% as of March 31, 2019. The Adviser has contractually agreed to waive certain fees through June 30, 2020.

The coronavirus not only wreaked havoc on the markets during the first quarter, it has temporarily shut down large segments of the economy, transformed how we live, and most importantly, infected nearly 2 million people around the world. Social distancing, hand washing, and (increasingly) face masks have become the new normal. To limit the economic damage, the U.S. government has approved an unprecedented $2 trillion relief package and the Federal Reserve has deployed every tool in its toolbox. The measures appear to be working, as the markets have begun to stabilize (though it is still too early to know whether we have reached a bottom), and both businesses and consumers are starting to receive the help they need.

In our latest Outlook, we take a closer look at the impact Covid-19 has had on the markets, and we also discuss how the simultaneous collapse of crude oil prices has created additional stress in the economy. While we appreciate that the near term is fraught with uncertainty, we believe economic activity will recover at some point and we view the current correction as an excellent buying opportunity. As we explain in the outlook, we expect that strong companies will come out of this stronger, and weak ones will be even weaker. With that as our operating principle, we have been selectively purchasing shares in companies that we feel are well positioned to succeed in the long run, all of which have been selling at a substantial discount to their pre-Covid prices.

We thank you for your continued confidence in our management.

Sincerely,

John Osterweis & Team

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Investment Team

John S. Osterweis

Founder, Chairman & Co-Chief Investment Officer – Core Equity

John S. Osterweis

John S. Osterweis

Founder, Chairman & Co-Chief Investment Officer – Core Equity

John Osterweis graduated from Bowdoin College (B.A. in Philosophy, cum laude), and Stanford Graduate School of Business (M.B.A. with top honors in Finance).

After graduating from business school, he served as a Senior Analyst concentrating on the forest products and paper industry for several regional brokerage firms and later for E.F. Hutton & Company, Inc. In addition to his activities as an analyst, Mr. Osterweis served as Director of Research for two firms and managed equity portfolios for over ten years.

In late 1982, Mr. Osterweis decided to devote full time to his portfolio management activities, and in April of 1983 launched Osterweis Capital Management.

For a number of years Mr. Osterweis served as Director of the Lucas Museum of Narrative Art, Director on the Stanford Alumni Association Executive Board, Trustee of Bowdoin College, Director and Vice Chairman of Mt. Zion Hospital and Medical Center, and President of the Board of Directors for Summer Search Foundation. He currently serves as a Trustee of the San Francisco Ballet Association Director of the San Francisco Free Clinic, and President Emeritus of the San Francisco Ballet Endowment Foundation, as well as Trustee Emeritus of Summer Search Foundation and of Bowdoin College.

Mr. Osterweis is a member of the firm’s Management Committee, a principal of the firm and the co-lead Portfolio Manager for the core equity and flexible balanced strategies.

Larry Cordisco

Co-Chief Investment Officer – Core Equity

Larry Cordisco

Co-Chief Investment Officer – Core Equity

Larry Cordisco graduated from the University of California, Santa Barbara (B.A. in Political Science), Georgetown University (M.P.P.) and Columbia Business School (M.B.A.).

Before joining Osterweis in 2019, he was a Co-Portfolio Manager of the Meridian Contrarian Fund at Arrowmark Partners/Meridian Funds. Prior to co-managing the Contrarian Fund, Larry was an equity analyst for 11 years, most recently as Vice President of Investment Research for the Meridian Contrarian Fund. Before that he was an analyst within the technology group at Banc of America Securities. He was also a business and technology consultant for Accenture in San Francisco and began his professional career in the public sector as a District Aide for Congressman George Miller.

Mr. Cordisco is a co-lead Portfolio Manager for the core equity strategy and portfolio manager for the flexible balanced strategy.

Gregory S. Hermanski

Vice President & Portfolio Manager

Gregory S. Hermanski

Vice President & Portfolio Manager

Greg Hermanski graduated from The University of California, Los Angeles (B.A. in Business/Economics).

Prior to joining Osterweis Capital Management in 2002, Mr. Hermanski was a Vice President at Robertson Stephens and Co. where he was in charge of convertible bond research. Prior to that, Mr. Hermanski was a Research Analyst covering convertible, high yield, and distressed securities at Imperial Capital, LLC and a Valuation Consultant for Price Waterhouse, LLC.

Mr. Hermanski is a principal of the firm and a Portfolio Manager for the core equity strategy.

Nael Fakhry

Vice President & Portfolio Manager

Nael Fakhry

Vice President & Portfolio Manager

Nael Fakhry graduated from Stanford University (B.A. in History, Phi Beta Kappa) and the University of California Berkeley, Walter A. Haas School of Business (M.B.A., C.J. White Scholar).

Prior to joining Osterweis Capital Management in 2011, Mr. Fakhry worked as an Associate at American Securities, a private equity firm, and as an Analyst in the investment banking division of Morgan Stanley.

Mr. Fakhry is a principal of the firm and a Portfolio Manager for the core equity strategy.

Dave Sherry

Senior Analyst

Dave Sherry

Senior Analyst

Dave Sherry graduated from Princeton University (A.B. in Economics) and from the Anderson School at UCLA (M.B.A). Mr. Sherry holds the Chartered Financial Analyst designation.

Prior to joining Osterweis Capital Management in 2017, Mr. Sherry was a Managing Director at Inflection Partners LLC, where he founded a long/short strategy that focused on the technology sector. Before that, Mr. Sherry held portfolio manager positions at EGM Capital, Partech International and LGT Asset Management. He began his investment career at Franklin Templeton Investments.

Mr. Sherry is a Senior Analyst for the core equity strategy.

Andrew Chang

Analyst

Andrew Chang graduated from Stanford University (B.S. in Management Science & Engineering, Phi Beta Kappa, Tau Beta Pi) and from the Wharton School at the University of Pennsylvania (M.B.A).

Prior to joining Osterweis Capital Management in 2020, Mr. Chang was a Senior Associate at Mill Road Capital. Before that, Mr. Chang was an Associate at Darlington Partners. He began his investment career at Goldman Sachs Investment Partners.

He also serves on the board of Project Open Hand.

Mr. Chang is an Analyst for the core equity strategy.

This commentary contains the current opinions of the author as of the date above, which are subject to change at any time. This commentary has been distributed for informational purposes only and is not a recommendation or offer of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but is not guaranteed.

The S&P 500 Index is an unmanaged index that is widely regarded as the standard for measuring large-cap U.S. stock market performance. The index does not incur expenses, is not available for investment, and includes the reinvestment of dividends.

Fund holdings are subject to change and should not be considered a recommendation to buy or sell any security.

Earnings growth is not representative of the fund’s future performance.

The Osterweis Funds are available by prospectus only. The Funds’ investment objectives, risks, charges and expenses must be considered carefully before investing. The summary and statutory prospectuses contain this and other important information about the Funds. You may obtain a summary or statutory prospectus by calling toll free at (866) 236-0050, or by visiting www.osterweis.com/statpro. Please read the prospectus carefully before investing to ensure the Fund is appropriate for your goals and risk tolerance.

Mutual fund investing involves risk. Principal loss is possible.

The Osterweis Fund may invest in medium and smaller sized companies, which involve additional risks such as limited liquidity and greater volatility. The Fund may invest in foreign and emerging market securities, which involve greater volatility and political, economic and currency risks and differences in accounting methods. These risks may increase for emerging markets. The Fund may invest in Master Limited Partnerships, which involve risk related to energy prices, demand and changes in tax code. The Fund may invest in debt securities that are un-rated or rated below investment grade. Lower-rated securities may present an increased possibility of default, price volatility or illiquidity compared to higher-rated securities. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities.

While the fund is no-load, management fees and other expenses still apply. Please refer to the prospectus for more information.

Osterweis Capital Management is the adviser to the Osterweis Funds, which are distributed by Quasar Distributors, LLC.