BUFFALO MID-CAP FUND PROSPECTUS

485APOS 1 partabc.htm BUFFALO MID CAP FUND PROSPECTUS BUFFALO MID-CAP FUND PROSPECTUS

Registration No. 333-56018 and 811-10303

As filed with the Securities and Exchange Commission on September 21, 2001

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]

Pre-Effective Amendment No. ______ [ ]

Post-Effective Amendment No. 2 [X]
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and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]

Amendment No. 3 [X]
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BUFFALO FUNDS
(Exact Name of Registrant as Specified in Charter)

BMA Tower, 700 Karnes Boulevard, Kansas City, MO 64108-3306
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(Address of Principal Executive Offices) (Zip Code)

(816) 751-5900
(Registrant's Telephone Number, Including Area Code)

Stephen S. Soden, BMA Tower, 700 Karnes Boulevard, Kansas City, MO 64108-3306
-----------------------------------------------------------------------------
(Name and Address of Agent for Service of Process)

With a Copy to:

Michael P. O'Hare, Esq.
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103

Approximate Date of Proposed Public Offering As soon as possible after
effectiveness.

It is proposed that this filing will become effective (check appropriate box):

[ ] immediately upon filing pursuant to paragraph (b) of Rule 485

[ ] on ____________ pursuant to paragraph (b) of Rule 485

[ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485

[ ] on (date) pursuant to paragraph (a)(1) of Rule 485

[X] 75 days after filing pursuant to paragraph (a)(2) of Rule 485

[ ] on (date) pursuant to paragraph (a)(2) of Rule 485

If appropriate, check the following box:

[ ] this post-effective amendment designates a new effective date
for a previously filed post-effective amendment.

Doc. #467461 v.01

BUFFALO(R) FUNDS

Mid Cap Fund

An equity fund seeking long-term capital growth through investments in
medium-sized companies.

Shares of the Fund have not been approved or disapproved by the Securities and
Exchange Commission nor has the Commission passed upon the adequacy of this
Prospectus. Any representation to the contrary is a criminal offense.

Prospectus
December ___, 2001

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.......................................................................................................................................
Prospectus December ___, 2001

Buffalo Funds INVESTMENT ADVISOR AND MANAGER:
KORNITZER CAPITAL MANAGEMENT, INC.
Mid Cap Fund
DISTRIBUTED BY:
JONES & BABSON, INC.

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Table of Contents
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Page
Information about the Fund [Renumber as needed]

Investment Objective and Principal Investment Strategy 2

Principal Risk Factors 3

Past Performance 4

Fees and Expenses 4

Management and Investment Advisor 5

Financial Highlights 6

Information about Investing

How to Purchase Shares 6

How to Redeem Shares 7

Shareholder Services 7

How Share Price Is Determined 8

Distributions and Taxes 9

Additional Policies about Transactions 10

Conducting Business with the Buffalo Funds 12

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Investment Objective and Principal Investment Strategy
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The investment objective for the Buffalo Mid Cap Fund is long-term capital
growth. To pursue its investment objective, the Fund maintains a diversified
portfolio of investments and normally invests at least 80% of its net assets in
common stocks and other equity securities (including convertibles and warrants)
of medium-sized, or "mid-cap," companies.

The Fund considers a company to be a mid-cap company if it has a market
capitalization between $1.5 billion and $10 billion at the time of purchase.
Market capitalization provides a measurement of a company's size, and it is
calculated by multiplying all of a company's outstanding shares of stock by the
stock's current price.

In its selection process, the Fund's Advisor seeks to identify long-term trends
with the aim of investing in companies that it expects to have favorable
operating environments during the three to five years that follow purchase. The
Advisor also examines the cash flow of companies and identifies companies that
exhibit consistent or predictable cash generation. The Advisor then selects
securities based on: 1) fundamental analysis of industries and the economic
cycle; 2) company-specific analysis such as product cycles, management, etc.,
and 3) rigorous valuation analysis. The Fund may sell securities for a variety
of reasons, such as to secure gains, limit losses, or reinvest assets in more
promising investment opportunities.

The Fund generally holds some cash, short-term debt obligations, government
securities or other high-quality investments for reserves to cover redemptions
and unanticipated expenses. There may be times, however, when the Fund attempts
to respond to adverse market, economic, political or other conditions by
investing up to 100% of its assets in those types of investments for temporary
defensive purposes. During those times, the Fund will not be able to pursue its
primary investment objective and, instead, will focus on preserving its assets.

The Fund's Board of Trustees may change the investment objective and policies
described in this prospectus without obtaining shareholder approval.

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Principal Risk Factors
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Market Risks. Equity securities are subject to market, economic and business
risks that will cause their prices to fluctuate over time. Since the Fund is
normally invested in equity securities, the value of the Fund will go up and
down. In addition, stock markets are volatile and can decline significantly in
response to adverse issuer, political, regulatory, market or economic
developments. As with any mutual fund, there is a risk that you could lose money
by investing in the Fund.

The Fund's success depends largely on the Advisor's ability to select favorable
investments. Also, different types of investments shift in and out of favor
depending on market and economic conditions. For example, at various times
stocks will be more or less favorable than bonds, and small or medium company
stocks will be more or less favorable than large company stocks. Because of
this, the Fund will perform better or worse than other types of funds depending
on what is in "favor."

Medium-Sized Company Risks. Generally, medium-sized companies may have more
potential for growth than larger companies. Investing in medium-sized companies,
however, may involve greater risk than investing in larger companies, and these
risks are passed on to funds that invest in them. Medium-sized companies may not
have the management experience, financial resources, product diversification and
competitive strengths of larger companies, and, therefore, their securities may
be more volatile than the securities of larger, more established companies.
Medium-sized company stocks may be bought and sold less often and in smaller
amounts than larger company stocks. Therefore, if the Fund wants to sell a large
quantity of a medium-sized company's stock, it may have to sell at a lower price
than the Advisor might prefer, or it may have to sell in small quantities over a
period of time. The Fund's Advisor tries to minimize this risk by investing in
stocks that are readily bought and sold. An investment in the Buffalo Mid Cap
Fund may be more suitable for long-term investors, who are willing to bear the
risk of these fluctuations.

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Past Performance
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The Fund is new and therefore, there is no past performance information. The
Fund's performance will vary from year to year. Past performance does not
necessarily indicate how a fund will perform in the future. As a shareholder,
you may lose or make money on your investment. When the Fund establishes a
performance record, this section will contain a bar chart that shows changes in
the Fund's returns from year to year, as well as a table that shows the Fund's
average total returns.

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Fees and Expenses
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The following table describes the fees and expenses that you may pay if you buy
and hold shares of the Fund.

Buffalo
Mid Cap
Fund
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Shareholder Fees
(fees paid directly from your investment)

Maximum Sales Charge (Load) Imposed on Purchases None

Maximum Deferred Sales Charge (Load) None

Maximum Sales Charge (Load) Imposed on Reinvested Dividends None

Redemption Fee None^1

Exchange Fee None

1 A $10 fee is imposed for redemptions by wire.

Annual Fund Operating Expenses
(expenses that are deducted from Fund assets)

Management Fees 1.00%

Distribution (12b-1) fees None

Other Expenses .05%^2

Total Annual Fund Operating Expenses 1.05%

2 The Fund is new so the amount of "Other Expenses" is based on estimates for
the current fiscal year.

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Examples
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The following 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
redeem all of your shares at the end of those periods. The example also assumes
that your investment has a 5% return each year and that the Fund's operating
expenses remain the same. Although your actual costs may be higher or lower,
based on these assumptions your costs would be:

1 Year 3 Years
-------------------------
Buffalo Mid Cap Fund $107 $334

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Management and Investment Advisor
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Kornitzer Capital Management, Inc. ("KCM"), the Fund's manager and investment
advisor ("Advisor"), was founded in 1989. In addition to managing and advising
the other six Buffalo mutual funds, it provides advisory services to a broad
variety of individual, corporate and other institutional clients. As manager,
KCM provides or pays the cost of all management, supervisory and administrative
services required in the normal operation of the Mid Cap Fund. This includes the
cost of investment management and supervision; custodian fees; independent
auditors and legal counsel; officers, trustees and other personnel; rent;
shareholder services; and other items incidental to corporate administration.

Operating expenses not required in the normal operation of the Fund are payable
by the Fund. These expenses include taxes, interest, governmental charges and
fees, including fees for registering the Fund with the Securities and Exchange
Commission and fees paid to various States, brokerage costs, dues, and all
extraordinary costs including expenses arising out of anticipated or actual
litigation or administrative proceedings.

A team of four individuals manages the Buffalo Funds. Kent Gasaway is the lead
manager for the Buffalo Mid Cap Fund. Kent joined KCM in 1991 and is a Chartered
Financial Analyst with 18 years of research and management experience. He holds
a B.S. in Business Administration from Kansas State University. John Kornitzer
has over 30 years of investment experience. He served as investment manager at
several Fortune 500 companies prior to founding KCM in 1989. Tom Laming joined
KCM in 1993-he is an experienced aerospace engineer and research analyst. He
holds a B.S. in Physics from the University of Kansas, an M.S. in Aeronautics
and Astronautics from the Massachusetts Institute of Technology ("MIT"), and a
M.B.A. from Indiana University. Rob Male is a Chartered Financial Analyst with
more than 11 years of investment research experience, who joined KCM in 1997.
Rob was an investment manager with USAA, in San Antonio, TX, from 1992 to 1997.
He holds a B.S. in Business Administration from the University of Kansas and a
M.B.A. from Southern Methodist University. For its services, the Fund pays KCM a
fee at the annual rate of one percent (1.00%) of the Fund's average daily net
assets. Kornitzer Capital Management, Inc. is located at 5420 West 61st Place,
Shawnee Mission, KS 66205.

Jones & Babson, Inc., which was formed in 1959, serves as the distributor
and transfer agent for the Fund. Jones & Babson, Inc. is located at BMA
Tower, 700 Karnes Blvd., Kansas City, MO 64108-3306.

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Financial Highlights
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The Fund is new, and, therefore, there are no financial highlights.

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How to Purchase Shares
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No Load Fund

o There are no sales commissions or Rule 12b-1 distribution fees

How to Buy Shares (see chart on page 12 for details)

o By phone, mail or wire

o Through Automatic Monthly Investments

o Through exchanges from another Buffalo Fund or the Babson Money Market Fund

Minimum Initial Investment

o $2,500 (unless Automatic Monthly)

o $100 with an Automatic Monthly Investment Plan

o $250 for IRA and Uniform Transfer (Gift) to Minors accounts

o $1,000 for exchanges from another Buffalo Fund or the Babson Money Market Fund

Minimum Additional Investment

o $100 by mail

o $1,000 by wire

o $100 for Automatic Monthly Investments or telephone (ACH)

o $1,000 for exchanges from another Buffalo Fund or the Babson Money Market Fund

Minimum Account Size

You must maintain a minimum account value equal to the current minimum initial
investment (usually $2,500). If your account falls below this amount due to
redemptions (not due to market action) we may ask you to increase the account to
the minimum. If you do not bring the account up to the minimum within 60 days
after we contact you, we will close the account and send your money to you.

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How to Redeem Shares
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You may withdraw from your account at any time in the following amounts:

o Any amount for redemptions requested by mail

o $1,000 or more for redemptions wired to your account ($10 fee)

o $50 or more for redemptions by a systematic redemption plan (there may be a
fee)

o $1,000 or more for exchanges to another fund

o $100 or more for redemptions by automatic monthly exchange to another fund

o $100 or more via ACH; there is no fee but funds may take 4 days to reach
your account

o Up to $25,000 by telephone (you must first request this option in writing
with a signature guarantee)

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Shareholder Services
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The following services are also available to shareholders. Please call
1-800-49-BUFFALO (1-800-492-8332) for more information:

o Uniform Transfers (Gifts) to Minors accounts

o Accounts for corporations or partnerships

o Sub-Accounting Services for Keogh, tax qualified retirement plans, and others

o Prototype Retirement Plans for the self-employed, partnerships and
corporations

o Traditional IRA accounts

o Roth IRA accounts

o Education IRA accounts

o Simplified Employee Pensions (SEPs)

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How Share Price Is Determined
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Shares of the Fund are purchased or redeemed at the net asset value per share
next calculated after your purchase order and payment (or redemption order) is
received by the Fund. In the case of certain institutions, which have made
satisfactory payment or redemption arrangements with the Fund, orders will be
processed at the net asset value per share next effective after receipt by that
institution.

The net asset value is calculated by subtracting from the Fund's total assets
any liabilities and then dividing into this amount the total outstanding shares
as of the date of the calculation. The net asset value per share is computed
once daily, Monday through Friday, at 4:00 p.m. (Eastern Time) on days when the
Fund is open for business (generally the same days that the New York Stock
Exchange is open for trading). The Fund is generally closed on weekends,
national holidays and Good Friday.

Each security owned by the Fund that is listed on a securities exchange is
valued at its last sale price on that exchange on the date as of which assets
are valued. Where the security is listed on more than one exchange, the Fund
will use the price of that exchange which it generally considers to be the
principal exchange on which the stock is traded. Lacking sales, the security is
valued at the mean between the last current closing bid and asked prices. An
unlisted security for which over-the-counter market quotations are readily
available is valued at the mean between the last bid and asked prices. When
market quotations are not readily available, any security or other asset is
valued at its fair value as determined in good faith by the Fund's Board of
Trustees.

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Distributions and Taxes
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The Fund pays distributions from net investment income semi-annually, usually in
June and December. Distributions from net capital gains realized on the sale of
securities will be declared by the Fund annually on or before December 31. Your
distributions will be reinvested automatically in additional shares of the Fund,
unless you have elected on your original application, or by written instructions
filed with the Fund, to have them paid in cash ($10 minimum check amount). We
automatically reinvest all dividends under $10.00 in additional shares of the
Fund. There are no fees or sales charges on reinvestments.

Tax Considerations. On June 7, 2001, President Bush signed into law the Economic
Growth and Tax Relief Reconciliation Act of 2001, which includes provisions that
significantly reduce individual federal income tax rates and provide additional
savings incentives for individuals generally by increasing the maximum annual
contribution limits applicable to retirement and education savings programs. You
should contact your personal tax advisor if you have questions about how this
Act will affect your investment in the Fund.

In general, if you are a taxable investor, distributions from the Fund are
taxable to you as either ordinary income or capital gains. This is true whether
you reinvest your distributions in additional shares of the Fund or receive them
in cash. Any capital gains, which the Fund distributes as net long-term capital
gains, will be taxable to you as long-term capital gains no matter how long you
have owned your shares. If you invest in a Fund shortly before it makes a
distribution, you may receive some or all of your investment back in the form of
a taxable distribution.

When you sell your shares of the Fund, you may have a capital gain or loss. For
tax purposes, an exchange of your Fund shares for shares of a different Buffalo
Fund or the Babson Money Market Fund is the same as a sale.

Fund distributions and gains from the sale or exchange of your shares will
generally be subject to state and local tax. Non-U.S. investors may be subject
to U.S. withholding and estate tax and are subject to special U.S. tax
certification requirements. You should consult your tax advisor about the
federal, state, local or foreign tax consequences of your investment in the
Fund.

Backup Withholding. By law, the Fund must withhold a portion of your taxable
distributions and sale proceeds unless you provide your correct social security
or taxpayer identification number, certify that this number is correct, certify
that you are not subject to backup withholding, and certify that you are a U.S.
person (including a U.S. resident alien). The Fund also must withhold if the IRS
instructs it to do so. When withholding is required, the amount will be 30.5% of
your taxable distributions or redemption proceeds for calendar year 2001, after
August 6, 2001, 30% for calendar years 2002 and 2003, 29% for calendar years
2004 and 2005, and 28% for calendar years 2006 through 2010.

Every January, you will receive a statement that shows the tax status of
distributions you received for the previous year. Distributions declared in
December but paid in January are taxable as if they were paid in December.
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Additional Policies about Transactions
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We cannot process transaction requests unless they are properly completed as
described in this section. We may cancel or change our transaction policies
without notice. To avoid delays, please call us if you have any questions about
these policies. If you wish to purchase (or redeem) shares of the Fund through a
broker, a fee may be charged by that broker, whereas you may contact the Fund
directly and avoid this fee. In addition, you may be subject to other policies
or restrictions of the broker such as higher minimum account value, etc.

Purchases. We may reject orders when not accompanied by payment or when in the
best interest of the Fund and its shareholders.

Redemptions. We try to send proceeds as soon as practical. In any event, we
generally send proceeds by the third business day after we receive a proper
redemption request. We cannot accept requests that contain special conditions or
effective dates. We may request additional documentation to ensure that a
request is genuine. Under certain circumstances, we may pay you proceeds in the
form of portfolio securities owned by the Fund. If you receive securities
instead of cash, you will incur brokerage costs when converting into cash.

If you request a redemption within 15 days of purchase, we will delay sending
your proceeds until we have collected unconditional payment, which may take up
to 15 days from the date of purchase. For your protection, if your account
address has been changed within the last 30 days, your redemption request must
be in writing and signed by each account owner, with signature guarantees. The
right to redeem shares may be temporarily suspended in emergency situations only
as permitted under federal law.

Market Timers. The Fund may refuse to sell shares to market timers. You will be
considered a market timer if you (i) request a redemption of Fund shares within
two weeks of an earlier purchase request, (ii) make investments of large amounts
of $1 million or more followed by a redemption request in close proximity to the
purchase or (iii) otherwise seem to follow a timing pattern. Shares under common
ownership or control are combined for these purposes.

Signature Guarantees. You can obtain a signature guarantee from most banks,
credit unions, savings & loans or securities broker/dealers, but not a
notary public. For your protection, we require a guaranteed signature if you
request:

o A redemption check sent to a different payee, bank or address than that which
we have on file.

o A redemption check mailed to an address that has been changed within the last
30 days.

o A redemption for $25,000 or more in writing.

o A change in account registration or redemption instructions.

Corporations, Trusts and Other Entities. Additional documentation is normally
required for corporations, fiduciaries and others who hold shares in a
representative or nominee capacity. We cannot process your request until we have
all documents in the form required. Please call us first to avoid delays.

Exchanges to Another Fund. You must meet the minimum investment requirement of
the Buffalo Fund (or the Babson Money Market Fund) you are exchanging into. The
names and registrations on the two accounts must be identical. Your shares must
have been held in an open account for 15 days or more, and we must have received
good payment before we will exchange shares. You should review the prospectus of
the fund being purchased. Call us for a free copy.

Telephone Services. During periods of increased market activity, you may have
difficulty reaching us by telephone. If this happens, contact us by mail. We may
refuse a telephone request, including a telephone redemption request. We will
use reasonable procedures to confirm that telephone instructions are genuine. If
such procedures are followed and we reasonably believe the instructions are
genuine, the Fund is not liable for any loss due to unauthorized or fraudulent
instructions. At our option, we may limit the frequency or the amount of
telephone redemption requests. Neither the Fund nor Jones & Babson, Inc.
assumes responsibility for the authenticity of telephone redemption requests.

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Conducting Business with the Buffalo Funds
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By Phone How to Open an Account How to Add to an Account How to Sell Shares How to Exchange Shares
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1-800-49-BUFFALO If you already have an You may make investments You may withdraw any You may exchange shares
(1-800-492-8332) account with us and you ($1,000 minimum) by telephone. amount up to $25,000 by ($1,000 minimum or the
in the Kansas City have authorized telephone After we have received your telephone, provided you initial minimum fund
area 751-5900 exchanges, you may call to telephone call, we will deduct have registered for this requirement) for shares
open an account in another from your checking account the service previously. We in another Buffalo Fund
You must authorize Buffalo Fund or in the cost of the shares. will send funds only to or in the Babson Money
each type of Babson Money Market Fund the address of record. Market Fund. The shares
telephone by exchange ($1,000 minimum). Availability of this service is being exchanged must
transaction on The names and registrations subject to approval by the Fund have been held in open
your account on the accounts must be and participating banks. account for 15 days or
application or the identical. more.
appropriate form,
available from us.
All account owners
must sign. When
you call, we may
request personal
identification
and tape record
the call.

By Mail
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Initial Purchases Complete and sign the Make your check ($100 minimum) In a letter, include the In a letter, include the
and Redemptions: application that accompanies payable to UMB Bank, n.a. and genuine signature of each genuine signature of
Buffalo Funds this Prospectus. Your mail it to us. Always identify registered owner (exactly each registered owner,
P.O. Box 219757 initial investment must meet your account number or include as registered), the name the account number, the
Kansas City, MO the minimum amount. Make the detachable reminder stub of each account owner, number of shares or
64121-9757 your check payable to UMB (from your confirmation the account number and dollar amount to be
Bank, n.a., and be sure to statement). the number of shares or exchanged ($1,000
Subsequent indicate the name of the the dollar amount to be minimum) and the name
Purchases: Fund in which you are redeemed. We will send of the Buffalo Fund (or
Buffalo Funds investing. proceeds only to the the Babson Money Market
P.O. Box 219779 address of record. Fund) into which the
Kansas City, MO amount is being
64121-9779 transferred.

By Wire
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UMB Bank, n.a., Call us first to get an Wire share purchases ($1,000 Redemption proceeds Not applicable.
Kansas City, MO account number. We will minimum) should include the ($1,000 minimum) may be
ABA#101000695 require information such as names of each account owner, wired to your pre-
For Buffalo Mid your Social Security or your account number and the identified bank account.
Cap Fund Taxpayer Identification name of the fund in which you A $10 fee is deducted. If
AC=9870595095 Number, the amount being are purchasing shares. You your written request is
OBI=(your account wired ($2,500 minimum), and should notify us by telephone received before 4:00 P.M.
number and name and telephone number of that you have sent a wire (Eastern Time) we will
account name) the wiring bank. Then tell purchase order to UMB Bank, normally wire funds the
your bank to wire the amount. n.a. following day. If we
You must send us a completed receive your written
application as soon as request after 4:00 P.M.
possible or payment of your (Eastern Time), we will
redemption proceeds will be normally wire funds on
delayed. the second business day.
Contact your bank about
the time of receipt and
availability.

Through Automatic Transaction Plans
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You must authorize Not applicable. Automatic Monthly Systematic Redemption Monthly Exchanges:
each type of Investment: Plan: You may authorize
automatic You must authorize automatic You may specify a dollar monthly exchanges from
transaction on monthly investments in a amount ($50 minimum) to your account ($100
your account constant dollar amount ($100 be withdrawn monthly or minimum) to another
application or minimum) from your checking quarterly or have your Buffalo Fund or the
complete an account. We will draft your shares redeemed at a rate Babson Money Market
authorization checking account on the same calculated to exhaust the Fund. Exchanges will be
form, available day each month in the amount account at the end of a continued until all
from us upon your authorize. specified period. A shares have been
request. All maximum fee of $1.50 may exchanged or until you
registered owners be charged for each terminate the service.
must sign. withdrawal. You must own
shares in an open account
valued at $10,000 when you
when you first authorize
the systematic redemption
plan. You may cancel or
change your plan or redeem
all your shares at any
time. We will continue
withdrawals until your
shares are gone or until
the Fund or you cancel the
plan.

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BUFFALO FUNDS

Balanced Fund
Equity Fund
High Yield Fund
Mid Cap Fund
Science & Technology Fund
Small Cap Fund
USA Global Fund

Additional Information The Statement of Additional Information (SAI) contains
additional information about the Buffalo Mid Cap Fund and is incorporated by
reference into this Prospectus. The Fund's annual and semi-annual reports to
shareholders contain additional information about each of the Buffalo Fund's
investments. In the annual report you will find a discussion of the market
conditions and investment strategies that significantly affected each Fund's
performance during the last fiscal year. Because the Mid Cap Fund is new, it has
not yet published an annual or semi-annual report to shareholders.

You may obtain a free copy of these documents by calling, writing or e-mailing
the Fund as shown below. You also may call the toll free number given below to
request other information about the Fund and to make shareholder inquiries.

You may review and copy the SAI and other information about the Fund by visiting
the Securities and Exchange Commission's Public Reference Room in Washington, DC
(202-942-8090) or by accessing the EDGAR database on the Commission's Internet
site at http://www.sec.gov. Copies of this information also may be obtained,
upon payment of a duplicating fee, by writing to the Public Reference Section of
the Commission, Washington, DC 20549-0102, or by sending an e-mail request to
publicinfo@sec.gov.

BUFFALO FUNDS
P.O. Box 219757
Kansas City, MO 64121-9757

Investment Company Act
file numbers
811-8364 (Balanced Fund)
811-8900 (Equity Fund)
811-8898 (High Yield Fund)
811-10303 (Mid Cap Fund)
811-10303 (Science & Technology Fund)
811-8509 (Small Cap Fund)
811-8896 (USA Global Fund)

1-800-49-BUFFALO
(1-800-492-8332)
www.buffalofunds.com

PART B

BUFFALO MID CAP FUND
(a series of Buffalo Funds)

STATEMENT OF ADDITIONAL INFORMATION

December ___, 2001

This Statement of Additional Information is not a Prospectus but should be
read in conjunction with the Mid Cap Fund's current Prospectus, dated December
___, 2001. To obtain the Prospectus or any available Annual Report or
Semi-Annual Report to shareholders, free of charge, please call the Buffalo
Funds toll-free at 1-800-49-BUFFALO (1-800-492-8332), or in the Kansas City area
(816) 751-5900. When available, certain information from the Annual Report will
be incorporated by reference into this Statement. The Mid Cap Fund is a series
of the Buffalo Funds, a Delaware business trust organized on February 14, 2001.

TABLE OF CONTENTS
Page
Introduction......................................................... 2
Information About the Fund's Investments..............................2
Investment Objectives, Policies and Risks .......................2
Fundamental Investment Restrictions...............................6
Non-Fundamental Investment Restrictions.........................10
Portfolio Transactions..........................................11
Performance Measures.................................................12
Total Return....................................................12
Performance Comparisons.........................................13
Purchasing and Selling Shares........................................14
Purchases.......................................................14
Sales (Redemptions).............................................15
How Share Price Is Determined...................................15
Additional Purchase and Redemption Policies ....................15
Management of the Trust and the Fund.................................16
Trustees and Officers...........................................16
Compensation....................................................17
Manager and Investment Advisor..................................18
Code of Ethics..................................................19
Custodian ......................................................19
Independent Auditors............................................19
Control Persons and Principal Holders of the Funds..............19
Distributions and Taxes..............................................19
Financial Statements.................................................20
General Information and History......................................20
Appendix-Credit Ratings..............................................21

INTRODUCTION

Buffalo Mid Cap Fund (hereafter, the "Fund") is a series of Buffalo Funds (the
"Trust"), which is an open-end management investment company registered under
the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund is
classified as a diversified fund under the 1940 Act, which means that the assets
of the Fund are invested in a diversified portfolio of securities. This
Statement of Additional Information ("SAI") supplements the information
contained in the Fund's Prospectus dated December ___, 2001.

Unless otherwise indicated, the investment objective, strategies, and policies
described below and in the Prospectus may be changed by the Board of Trustees
without shareholder approval. Generally, the policies and restrictions discussed
in this SAI and in the Prospectus apply when the Fund makes an investment. In
most cases, the Fund is not required to sell a security because circumstances
change and the security no longer meets one or more of the Fund's policies or
restrictions. If a percentage restriction or limitation is met at the time of
investment, a later increase or decrease in the percentage due to a change in
the value or liquidity of portfolio securities will not be considered a
violation of the restriction or limitation. Kornitzer Capital Management, Inc.
("Kornitzer"), which is the manager and investment advisor (the "Advisor") for
all of the Buffalo Funds, selects the Fund's investments.

INFORMATION ABOUT THE FUND'S INVESTMENTS

Investment Objectives, Policies and Risks. The Fund's investment objective is
long-term capital growth. To achieve this, the Fund generally invests at least
80% of its net assets in common stocks and other equity securities (including
convertibles and warrants) of medium-sized companies. The Buffalo Mid Cap Fund
will normally invest in a broad array of securities, which are diversified in
terms of companies and industries. Investments in common stocks in general are
subject to market, economic and business risks that will cause their price to
fluctuate over time. Investment in such medium-sized company securities may
involve greater price volatility than securities of larger, more established
companies.

Equity Securities. The Fund will invest in equity securities. The purchaser of
an equity security typically receives an ownership interest in the company as
well as certain voting rights. The owner of an equity security may participate
in a company's success through the receipt of dividends, which are distributions
of earnings by the company to its owners. Equity security owners may also
participate in a company's success or lack of success through increases or
decreases in the value of the company's shares as traded in the public trading
market for such shares. Equity securities generally take the form of common
stock or preferred stock. Preferred stockholders typically receive greater
dividends but may receive less appreciation than common stockholders and may
have greater voting rights as well. Equity securities may also include
convertible securities.

Convertible Securities. The Fund may invest in convertible securities. A
convertible security is generally a debt obligation or preferred stock that may
be converted with a specified period of time into a certain amount of common
stock of the same or a different issuer. A convertible security provides a
fixed-income stream and the opportunity, through its conversion feature, to
participate in the capital appreciation resulting from a market price advance in
its underlying common stock. As with a straight fixed-income security, a
convertible security tends to increase in market value when interest rates
decline and decrease in value when interest rates rise. Like a common stock, the
value of a convertible security also tends to increase as the market value of
the underlying stock rises, and it tends to decrease as the market value of the
underlying stock declines. Because both interest rate and market movements can
influence its value, a convertible security is not as sensitive to interest
rates as a similar fixed-income security and not as sensitive to changes in
share price as its underlying stock.

A convertible security is usually issued either by an operating company or by an
investment bank. When issued by an operating company, a convertible security
tends to be senior to common stock, but subordinate to other types of
fixed-income securities issued by that company. When a convertible security
issued by an operating company is "converted," the operating company often
issues new stock to the holder of the convertible security. If, however, the
parity price (which is the price at which the common stock underlying the
convertible security may be obtained) of the convertible security is less than
the call price, which is the price of the bond including any premium related to
the conversion feature, the operating company may pay out cash instead of common
stock. When a convertible security is issued by an investment bank, the security
is an obligation of and is convertible through the issuing investment bank.

In addition, the issuer of a convertible security may be important in
determining the security's true value. This is because the holder of a
convertible security will have recourse only to the issuer. A convertible
security may be subject to redemption by the issuer, but only after a specified
date and under circumstances established at the time the security is issued.

While the Fund uses the same criteria to rate a convertible debt security that
it uses to rate a more conventional debt security, a convertible preferred stock
is treated like a preferred stock for the Fund's financial reporting, credit
rating, and investment limitation purposes. A preferred stock is subordinated to
all debt obligations in the event of insolvency, and an issuer's failure to make
a dividend payment is generally not an event of default entitling the preferred
shareholder to take action. A preferred stock generally has no maturity date, so
that its market value is dependent on the issuer's business prospects for an
indefinite period of time. In addition, distributions from preferred stock are
dividends, rather than interest payments, and are usually treated as such for
corporate tax purposes.

Warrants. The Fund may invest in warrants. A warrant allows the holder to
purchase a security at a fixed price during a preset time period. The value of a
warrant will increase, if the market value of a particular security increases
after the warrant is purchased. If the market value of the security decreases
after the warrant is purchased or if the term of the warrant expires before it
is exercised, the holder of the warrant will incur a loss. Warrants do not
provide the holder the right to receive dividends or the right to vote.

Cash Management. The Fund may invest a portion of its assets in cash or
high-quality, short-term debt obligations readily changeable into cash. Such
high quality, short-term obligations include: money market securities, money
market mutual funds, commercial paper, bank certificates of deposit, and
repurchase agreements collateralized by government securities. These investments
may be used for cash management purposes and to maintain liquidity in order to
satisfy redemption requests or pay unanticipated expenses, or they may be used
while the Fund's Advisor looks for suitable investment opportunities. There may
also be times when the Fund attempts to respond to adverse market, economic,
political or other conditions by investing up to 100% of its assets in these
types of investments for temporary, defensive purposes. During these times, the
Fund will not be able to pursue its primary investment objective and, instead,
will focus on preserving its assets.

In pursuing cash management strategies, the Fund will apply the following
criteria to its investments:

(1) Certificates of deposit, bankers' acceptances and other short-term
obligations must be issued domestically by United States commercial
banks having assets of at least $1 billion and which are members of
the Federal Deposit Insurance Corporation or holding companies of such
banks;

(2) Commercial paper will be limited to companies rated P-2 or higher by
Moody's or A-2 or higher by S&P(R), or if not rated by either
Moody's or S&P(R), a company's commercial paper may be purchased,
if the company has an outstanding bond issue rated Aa or higher by
Moody's or AA or higher by S&P(R);

(3) The Fund will purchase only short-term debt securities that are
non-convertible, that have one year or less remaining to maturity at
the date of purchase, and that are rated Aa or higher by Moody's or AA
or higher by S&P(R); and,

(4) The Fund will purchase only negotiable certificates of deposit and
other short-term debt obligations of savings and loan associations
having assets of at least $1 billion, which are members of the Federal
Home Loan Banks Association and insured by the Federal Savings and
Loan Insurance Corporation.

The securities used for cash management can go down in value. The market value
of debt securities generally varies in response to changes in interest rates and
the financial condition of each issuer. During periods of declining interest
rates, the value of debt securities generally increases. Conversely, during
periods of rising interest rates, the value of these securities generally
declines. These changes in market value will be reflected in the Fund's net
asset value.

Repurchase agreements. The Fund may invest in issues of the United States
Treasury or a United States government agency subject to repurchase agreements.
A repurchase agreement involves the sale of securities to the Fund with the
concurrent agreement by the seller to repurchase the securities at the Fund's
cost plus interest at an agreed rate upon demand or within a specified time,
thereby determining the yield during the Fund's period of ownership. The result
is a fixed rate of return insulated from market fluctuations during such period.
Under the 1940 Act, repurchase agreements are considered loans by the Fund.

The Fund will enter into repurchase agreements only with United States banks
having assets in excess of $1 billion, which are members of the Federal Deposit
Insurance Corporation, and with certain securities dealers who meet the
qualifications as set from time to time by the Fund's Board of Trustees of the
Buffalo Funds Trust. The term to maturity of a repurchase agreement normally
will be no longer than a few days.

The use of repurchase agreements involves certain risks. For example, if the
seller of the agreement defaults on its obligation to repurchase the underlying
securities at a time when the value of these securities has declined, the Fund
may incur a loss when the securities are sold. If the seller of the agreement
becomes insolvent and subject to liquidation or reorganization under the
Bankruptcy Code or other laws, disposition of the underlying securities may be
delayed pending court proceedings. Finally, it is possible that a Fund may not
be able to perfect its interest in the underlying securities. While the Fund's
management acknowledges these risks, it is expected that they can be controlled
through stringent security selection criteria and careful monitoring procedures.

Debt Securities. In addition to investing for cash management purposes, the Fund
may invest in debt securities on an intermittent basis. A debt security
represents a loan of money by the purchase of the securities to the issuer. A
debt security typically has a fixed payment schedule that obligates the issuer
to pay interest to the lender and to return the lender's money over a certain
period of time. A company typically meets its payment obligations associated
with its outstanding debt securities before it declares and pays any dividends
to holders of its equity securities. Bonds, notes, debentures and commercial
paper are types of debt securities. Each of these differs in the length of the
issuers' payment schedule.

Debt securities are also subject to the risks described in this SAI's Cash
Management explanation. Independent rating organizations rate debt securities
based upon their assessment of the financial soundness of the issuer. Generally,
a lower rating indicates higher risk. The Fund may buy debt securities that are
rated A or higher by Moody's Investors Service, Inc. (Moody's) or Standard &
Poor's Ratings Group (S&P (R)); or unrated debt that is determined to be
comparable quality.

Asset-Backed Securities. The Fund may invest in asset-backed securities.
Asset-backed securities are collateralized by short maturity loans such as
automobile receivables, credit card receivables, and other types of receivables
or assets. Credit support for asset-backed securities may be based on the
underlying assets and/or provided through credit enhancements by a third party.
Credit enhancement techniques include letters of credit, insurance bonds,
limited guarantees (which are generally provided by the issuer),
senior-subordinated structures and over-collateralization.

As with all fixed-income securities, the value of asset-backed securities will
fluctuate in response to changing interest rates and to the general economy. In
addition to risks presented by changes in interest rates, prepayments, early
calls, and defaults can reduce returns on asset-backed securities.

Illiquid and Restricted Securities. The Fund may invest in illiquid and
restricted securities. But the Fund will not invest more than 15% of its net
assets in securities that it cannot sell or dispose of in the ordinary course of
business within seven days at approximately the price at which the Fund has
valued the investment.

Illiquid securities include repurchase agreements and time deposits with
notice/termination dates of more than seven days, certain variable-amount master
demand notes that cannot be called within seven days, certain insurance funding
agreements, certain unlisted over-the-counter options and other securities that
are traded in the U.S. but are subject to trading restrictions because they are
not registered under the Securities Act of 1933, as amended (the "1933 Act").
Because illiquid and restricted securities may be difficult to sell at an
acceptable price, they may be subject to greater volatility and may result in a
loss to the Fund.

The Fund may also, when consistent with its investment objective and policies,
purchase commercial paper issued pursuant to Section 4(2) of the 1933 Act and
domestically traded securities that are not registered under the 1933 Act but
can be sold to "qualified institutional buyers" in accordance with Rule 144A
under the 1933 Act ("Rule 144A Securities"). These securities will not be
considered illiquid so long as the Fund's Advisor determines, under guidelines
approved by the Board of Trustees, that an adequate trading market exists. The
practice of investing in Rule 144A Securities could increase the level of the
Fund's illiquidity during any period that qualified institutional buyers become
uninterested in purchasing these securities.

Covered Call Options. The Fund is authorized to write, which means sell, covered
call options on the securities in which it may invest and to enter into closing
purchase transactions with respect to some such options. A covered call option
is an option where the Fund, in return for a premium, gives another party a
right to buy specified securities owned by the Fund at a specified future date
and price set at the time of the contract. Covered call options are intended to
serve as a partial hedge against any declining price of the underlying
securities.

Up to 25% of the Fund's total assets may be subject to covered call options. By
writing covered call options, the Fund gives up the opportunity, while the
option is in effect, to profit from any price increase in the underlying
security above the option exercise price. In addition, a Fund's ability to sell
the underlying security will be limited while the option is in effect unless the
Fund effects a closing purchase transaction. A closing purchase transaction
cancels out a Fund's position as the writer of an option by means of an
offsetting purchase of an identical option prior to the expiration of the option
it has written. Upon the termination of the Fund's obligation under a covered
call option other than through exercise of the option, the Fund will realize a
short-term capital gain or loss. Any gain realized by the Fund from the exercise
of an option will be short-term or long-term depending on the period for which
the stock was held. The writing of covered call options creates a straddle that
is potentially subject to the straddle rules, which result in a deferral of some
losses for tax purposes.

ADRs. The Fund may gain international exposure through investing in American
Depository Receipts (ADRs). ADRs, which are issued by domestic banks, are
publicly traded in the United States and represent ownership in underlying
foreign securities. The Fund does not intend to invest directly in foreign
securities or foreign currencies.

Up to 25% of the Fund's total assets may be invested in ADRs. Most ADRs are
traded on a U.S. stock exchange and can be sponsored or unsponsored. Issuers of
unsponsored ADRs are not contractually obligated to disclose material
information in the U.S. and, therefore, there may not be a correlation between
such information and the market value of the unsponsored ADR. ADRs do not
involve the same direct currency and liquidity risks as securities denominated
in foreign currency. However, their value will generally be affected by currency
fluctuations that alter the value of the security underlying the ADRs with
respect to the U.S. dollar.

Fundamental Investment Restrictions. The Board of Trustees of the Trust have
adopted the following fundamental policies for the Buffalo Mid Cap Fund. These
policies cannot be changed without the approval of a "majority of the
outstanding voting securities" of the Fund. Under the 1940 Act, a "majority of
the outstanding voting securities" of the Fund means the vote of: (i) more than
50% of the outstanding voting securities of the Fund; or (ii) 67% or more of the
voting securities of the Fund present at a meeting, if the holders of more than
50% of the outstanding voting securities are present or represented by proxy,
whichever is less. In cases where the current legal or regulatory limitations
are explained, such explanations are not part of the fundamental restriction and
may be modified without shareholder approval to reflect changes in the legal and
regulatory requirements.

Diversification. The Fund is classified as diversified as defined under the 1940
Act and the Fund may not change its classification from diversified to
non-diversified without shareholder approval. Under the 1940 Act, diversified
generally means that the Fund may not, with respect to 75% of its total assets,
invest more than 5% of its total assets in securities of any one issuer, except
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities and securities issued by investment companies, or purchase
more than 10% of the voting securities of any one issuer.

Concentration. The Fund will not make investments that will result in the
concentration, as that term may be defined in the 1940 Act, any rule or order
thereunder, or U.S. Securities and Exchange Commission ("SEC") staff
interpretation thereof, of its investments in the securities of issuers
primarily engaged in the same industry. The SEC staff currently takes the
position that a mutual fund concentrates its investments in a particular
industry if 25% or more of its total assets are invested in issuers within the
industry. This restriction does not limit a Fund from investing in obligations
issued or guaranteed by the U.S. government, or its agencies or
instrumentalities. In applying this fundamental policy concerning industry
concentration, the Fund will apply a non-fundamental policy, described
hereafter, governing categorization of companies into specific industries.
Concentration will be examined by looking at each company's particular niche and
not its general industry. In particular, technology companies will be divided
according to their products and services; for example, hardware, software,
information services and outsourcing, and telecommunications will each be a
separate industry. Furthermore, financial service companies will be classified
according to the end users of their services; for example, automobile finance,
bank finance and diversified finance will each be considered a separate
industry; asset-backed securities will be classified according to the underlying
assets securing such securities; and, utility companies will be divided
according to their services; for example, gas, gas transmission, electric and
telephone will each be considered a separate industry.

Borrowing. The Fund will not borrow money or issue senior securities, except as
the 1940 Act, any rule thereunder, or SEC staff interpretation thereof, may
permit; and, the following sentences describe the current regulatory limits. The
Fund may borrow up to 5% of its total assets for temporary purposes. In
addition, for temporary defensive purposes, the Fund may borrow more than 5% of
its total assets from banks, provided that if borrowings exceed 5%, the Fund
will have assets totaling at least 300% of the borrowing when the amount of the
borrowing is added to the Fund's other assets. This provision allows the Fund to
borrow from banks amounts up to one-third (33 1/3%) of its total assets,
including those assets represented by the borrowing.

Underwriting. The Fund will not underwrite the securities of other issuers,
except that the Fund 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.

Real Estate. The Fund will not 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 investing in issuers which invest,
deal or otherwise engage in transactions in real estate or interests therein, or
investing in securities that are secured by real estate or interests therein.

Commodities. The Fund will not purchase or sell physical commodities, unless
acquired as a result of ownership of securities or other instruments and
provided that this restriction does not prevent the Fund from engaging in
transactions involving futures contracts and options thereon or investing in
securities that are secured by physical commodities.

Loans. The Fund will not make loans, provided that this restriction does not
prevent the Fund from purchasing debt obligations, entering into repurchase
agreements, and loaning its assets to broker/dealers or institutional investors.

Non-Fundamental Investment Restrictions. In addition to the Fund's investment
objective and policies described in the Prospectus and in this SAI, the Fund
will be subject to the following non-fundamental investment restrictions, which
the Board of Trustees may change without shareholder approval.

Other Investment Companies. The Fund is permitted to invest in other investment
companies, including open-end, closed-end or unregistered investment companies,
either within the percentage limits set forth in the 1940 Act, any rule or order
thereunder, or SEC staff interpretation thereof, or without regard to percentage
limits in connection with a merger, reorganization, consolidation or other
similar transaction. But the Fund may not operate as a fund of funds which
invests primarily in the shares of other investment companies as permitted by
Section 12(d)(1)(F) or (G) of the 1940 Act, if its own shares are utilized as
investments by such a fund of funds. Under current legal and regulatory
requirements, the Fund may invest up to 5% of its total assets in the securities
of any one investment company, but may not own more than 3% of any investment
company or invest more than 10% of its total assets in the securities of other
investment companies.

Leveraging. The Fund will not borrow for the purpose of leveraging its
investments. In this regard, the Fund will not purchase portfolio securities
when borrowings exceed 5% of its total assets.

Portfolio Transactions. Kornitzer makes the decisions about buying and selling
securities for the Fund, selecting brokers and dealers to execute securities
transactions, and allocating portfolio brokerage and principal business and
negotiating commissions and/or price of the securities. In instances where
securities are purchased on a commission basis, Kornitzer will seek best
execution of transactions at competitive and reasonable commission rates based
on all circumstances related to the trade.

The level of brokerage commissions generated by the Fund is directly related to
the number and the size of the buy and sell transactions into which the Fund
enters. The frequency and size of these transactions are affected by various
factors such as cash flows into and out of the Fund, the Advisor's
interpretation of the market or economic environment, etc.

The Fund believes it is in its best interest to have a stable and continuous
relationship with a diverse group of financially strong and technically
qualified broker-dealers who will provide quality executions at competitive
rates. Broker-dealers meeting these qualifications also will be selected for
their demonstrated loyalty to the Fund, when acting on its behalf, as well as
for any research or other services provided to the Fund. The Funds may execute a
substantial portion of the portfolio transactions through brokerage firms that
are members of the New York Stock Exchange or through other major securities
exchanges. When buying securities in the over-the-counter market, the Fund will
select a broker who maintains a primary market for the security unless it
appears that a better combination of price and execution may be obtained
elsewhere. The Fund will not normally pay a higher commission rate to
broker-dealers providing benefits or services to it than it would pay to
broker-dealers who did not provide such benefits or services. The Fund, however,
reserves the right to do so within the principles set out in Section 28(e) of
the Securities Exchange Act of 1934 when it appears that this would be in the
best interests of the shareholders.

No commitment is made to any broker or dealer with regard to placing of orders
for the purchase or sale of Fund portfolio securities, and no specific formula
is used in placing such business. Both the Fund's Board of Trustees and
Kornitzer regularly review brokerage allocation.

When the Advisor in its fiduciary duty believes it to be in the best interest of
the shareholders, the Fund may join with other clients of the Advisor in
acquiring or disposing of a portfolio holding. Securities acquired or proceeds
obtained will be equitably distributed among the Fund and other clients
participating in the transaction. In some instances, this investment procedure
may affect the price paid or received by the Fund or the size of the position
obtained by the Fund.

PERFORMANCE MEASURES

The Fund may advertise "average annual total return" over various periods of
time. Such total return figures show the average percentage change in value of
an investment in the Fund from the beginning date of the measuring period to the
end of the measuring period. These figures reflect changes in the price of each
Fund's shares and assume that any income dividends and/or capital gains
distributions made by the Fund during the period were reinvested in shares of
the Fund. Figures will be given for recent one-, five- and ten-year periods when
applicable, and may be given for other periods as well, such as from
commencement of the Fund's operations, or on a year-by-year basis. When
considering "average" total return figures, for periods longer than one year, it
is important to note that the Fund's annual total return for any one year in the
period might have been greater or less than the average for the entire period.

Total Return. The Fund's "average annual total return" figures when described
and shown below are computed according to a formula prescribed by the Securities
and Exchange Commission. The formula can be expressed as follows:

P(1+T)n = ERV

Where: P= a hypothetical initial payment
of $1,000

T= average annual total return

n= number of years

ERV= Ending Redeemable Value of a hypothetical $1,000 payment made
at the beginning of the 1, 5 or 10 year (or other) periods at the
end of the 1, 5 or 10 year (or other) periods (or fractional
portions thereof).

From time to time, the Fund may quote its yield in advertisements, shareholder
reports or other communications to shareholders. Yield is calculated according
to the following standardized SEC formula.

Current yield reflects the income per share earned by the Fund's investments.

Current yield is determined by dividing the net investment income per share
earned during a 30-day base period by the maximum offering price per share on
the last day of the period and annualizing the result. Expenses accrued for the
period include any fees charged to all shareholders during the base period.

The SEC standardized yield formula is as follows:

Yield = 2(((a-b)/cd) + 1)^6-1)

Where:

a = dividends and interest earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of shares outstanding during the period that were
entitled to receive dividends d = the maximum offering price per share on
the last day of the period.

Performance Comparisons. In advertisements or in reports to shareholders, the
Fund may compare its performance to that of other mutual funds with similar
investment objectives and to stock or other relevant indices. For example, it
may compare its performance to rankings prepared by Lipper Analytical Services,
Inc. ("Lipper"), a widely recognized independent service that monitors the
performance of mutual funds. The Fund may compare its performance to the
Standard & Poor's 500 Stock Index (S&P(R) 500), an index of unmanaged
groups of common stocks, the Dow Jones Industrial Average, a recognized
unmanaged index of common stocks of 30 industrial companies listed on the NYSE,
the Russell 2000 Index, a small company stock index, or the Consumer Price
Index.

Performance rankings, recommendations, published editorial comments and listings
reported in Money, Barron's, Kiplinger's Personal Finance Magazine, Financial
World, Forbes, Smart Money, Mutual Fund Magazine, U.S. News & World Report,
Business Week, The Wall Street Journal, Investors Business Daily, USA Today,
Fortune and Stanger's may also be cited (if the Fund is listed in any such
publication) or used for comparison, as well as performance listings and
rankings from Morningstar Mutual Funds, Personal Finance, Income and Safety, The
Mutual Fund Letter, No-Load Fund Investor, United Mutual Fund Selector, No-Load
Fund Analyst, No-Load Fund X, Louis Rukeyser's Wall Street newsletter,
Donoghue's Money Letter, CDA Investment Technologies, Inc., Wiesenberger
Investment Companies Service and Donoghue's Mutual Fund Almanac.

PURCHASING AND SELLING SHARES

Purchases. Neither the Fund nor the entities that provide services to it (the
"Fund Complex") will be responsible for the consequences of delays, including
delays in the banking or Federal Reserve wire systems. The Fund Complex cannot
process transaction requests that are not completed properly. If you use the
services of any other broker to purchase or redeem shares of the Fund, that
broker may charge you a fee. Shares of the Fund may be purchased directly from
the Fund without this brokerage fee. Each order accepted will be fully invested
in whole and fractional shares, unless the purchase of a certain number of whole
shares is specified, at the net asset value per share next effective after the
order is accepted by the Fund.

Each investment is confirmed by a year-to-date statement that provides the
details of the immediate transaction, plus all prior transactions in your
account during the current year. This includes the dollar amount invested, the
number of shares purchased or redeemed, the price per share, and the aggregate
shares owned. A transcript of all activity in your account during the previous
year will be furnished each January. By retaining each annual summary and the
last year-to-date statement, you have a complete detailed history of your
account, which provides necessary tax information. A duplicate copy of a past
annual statement is available from Jones & Babson, Inc. at its cost, subject
to a minimum charge of $5 per account, per year requested.

Normally, the shares you purchase are held by the Fund in open account, thereby
relieving you of the responsibility of providing for the safekeeping of a
negotiable share certificate. Should you have a special need for a certificate,
one will be issued on request for all or a portion of the whole shares in your
account. A charge of $25.00 will be made for any certificates issued. In order
to protect the interests of the other shareholders, share certificates will be
sent to those shareholders who request them only after the Fund has determined
that unconditional payment for the shares represented by the certificate has
been received by its custodian, UMB Bank, n.a.

The Fund reserves the right in their sole discretion to withdraw all or any part
of the offering made by the prospectus or to reject purchase orders when, in the
judgment of Fund's management, such withdrawal or rejection is in the best
interest of the Fund and its shareholders.

The Fund reserves the right to refuse to accept orders for Fund shares unless
accompanied by payment, except when a responsible person has indemnified the
Fund against losses resulting from the failure of investors to make payment. If
an order to purchase shares must be canceled due to non-payment, the purchaser
will be responsible for any loss incurred by the Fund arising out of such
cancellation. To recover any such loss, the Fund reserves the right to redeem
shares by any purchaser whose order is canceled, and such purchaser may be
prohibited or restricted in the manner of placing further orders.

Sales (Redemptions). The Fund Complex will not be responsible for the
consequences of delays, including delays in the banking or Federal Reserve wire
systems. The Fund Complex cannot process transaction requests that are not
completed properly. The Fund must receive an endorsed share certificate with a
signature guarantee, where a certificate has been issued.

The Fund may suspend the right of redemption or postpone the date of payment
beyond the normal three-day redemption period under the following conditions
authorized by the Investment Company Act of 1940: (1) for any period (a) during
which the New York Stock Exchange is closed, other than customary weekend and
holiday closing, or (b) during which trading on the New York Stock Exchange is
restricted; (2) for any period during which an emergency exists as a result of
which (a) disposal of Fund securities is not reasonably practical, or (b) it is
not reasonably practical for the Fund to determine the fair value of its net
assets; (3) under certain circumstances where certain shareholders are
attempting to "time the market" by purchasing and redeeming Fund shares on a
regular basis; or (4) for such other periods as the Securities and Exchange
Commission may by order permit for the protection of the Fund's shareholders.

The Fund has elected to be governed by Rule 18f-1 under the Investment Company
Act of 1940 pursuant to which it is obligated to redeem shares solely in cash up
to the lesser of $250,000 or 1% of the Fund's net asset value during any 90-day
period for any one shareholder. Should redemptions by any shareholder exceed
such limitation, the Fund may redeem the excess in kind. If shares are redeemed
in kind, the redeeming shareholder may incur brokerage costs in converting the
assets to cash.

How Share Price is Determined. The Fund's net asset value per share is computed
once daily, Monday through Friday, at 4:00 p.m., Eastern Time except: days when
the Fund is not open for business; days on which changes in the value of
portfolio securities will not materially affect the net asset value; days during
which the Fund receives no purchase or redemption orders; and customary
holidays.

The Fund does not compute its net asset value days when the New York Stock
Exchange is closed or on the following customary holidays:

New Year's Day January 1
Martin Luther King Jr. Day Third Monday in January
Presidents' Holiday Third Monday in February
Good Friday Friday before Easter
Memorial Day Last Monday in May
Independence Day July 4
Labor Day First Monday in September
Thanksgiving Day Fourth Thursday in November
Christmas Day December 25

Additional Purchase and Redemption Policies. The Fund reserves the right to:

(1) Waive or increase the minimum investment requirements with respect to
any person or class of persons, which includes shareholders that
invest through any of the Fund's special investment programs;

(2) Cancel or change the telephone investment service, the telephone
exchange service and the automatic monthly investment plan without
prior notice to you when doing so is in the best interest of the Fund
and its shareholders;

(3) Begin charging a fee for the telephone investment service or the
automatic monthly investment plan and to cancel or change these
services upon 15 days written notice to you;

(4) Begin charging a fee for the telephone service and to cancel or change
the service upon 60 days written notice to you;

(5) Begin charging a fee for the systematic redemption plan upon 30 days
written notice to you;

(6) Waive signature guarantee requirements in certain instances where it
appears reasonable to do so and will not unduly affect the interests
of other shareholders; the Fund may also waive the signature guarantee
requirement if you authorize the telephone redemption method at the
same time you submit the initial application to purchase shares; and,

(7) Require signature guarantees if there appears to be a pattern of
redemptions designed to avoid the signature guarantee requirement, or
if the Fund has other reason to believe that this requirement would be
in the best interests of the Fund and its shareholders.

MANAGEMENT OF THE TRUST AND THE FUND

The Trust is governed by a Board of Trustees, which is responsible for
protecting the interests of the Fund's shareholders. The Trustees are
experienced business persons, who meet throughout the year to oversee the Fund's
activities, review contractual arrangements with companies that provide services
to the Fund and to review performance.

Trustees and Officers. The officers of the Trust are responsible for supervising
the business operations of the Fund. The business of the Fund is largely
conducted by the Fund's Advisor-Kornitzer, and is subject to the supervision and
control of the Board of Trustees.

The following lists the officers and trustees' names, ages, positions, and
business backgrounds.

Stephen S. Soden (56), President and Trustee1. 700 Karnes Boulevard, Kansas
City, Missouri 64108-3306. President and Director (or Trustee) of, Jones &
Babson, Inc. and of each of the Babson Funds, Buffalo Funds, J&B Funds, and
the Investors Mark Series Fund, Inc. Director and Senior Vice President of
Business Men's Assurance Company of America, Inc. and President and Director of
BMA Financial Services, Inc.

Kent W. Gasaway (41), Trustee2. 5420 West 61st Place, Shawnee Mission, Kansas
66205. Director (or Trustee) of each Buffalo Fund since inception. Senior Vice
President, Kornitzer Capital Management, Inc., since November 1991 and formerly
Assistant Vice President, Waddell & Reed, Inc., (mutual fund manager) from
May 1982 to November 1991.

Thomas S. Case (60), Trustee. 515 Piney Creek Road, Reno, Nevada 89511. Director
(or Trustee) of each Buffalo Fund since inception. Retired and formerly
President and Chief Executive Officer, the Frankona American Companies
(insurance company).

Gene M. Betts (49), Trustee. P.O. Box 11315, Kansas City, Missouri 64112.
Director (or Trustee) of each Buffalo Fund since February 6, 2001. Senior Vice
President and Treasurer, Sprint Corporation (telecommunications) since 1987 and
formerly, Director, Great Plains Trust Company (1994-2000).

J. Gary Gradinger (58), Trustee. 400 E. 10th Avenue, Kansas City, Missouri
64116. Director (or Trustee) of each Buffalo Fund since February 6, 2001.
Chairman, President and Chief Executive Officer, Golden Star Inc. (manufacturer
of textile and cleaning products) since 1968.

Philip J. Kennedy (56), Trustee. 1109 E. Pine Street, Grove City, Pennsylvania
16127. Director (or Trustee) of each Buffalo Fund since February 6, 2001.
Faculty member, Accounting Department, Slippery Rock University since 1984,
self-employed consultant and Certified Public Accountant; and formerly,
Director, Great Plains Trust Company (1994-2000).

P. Bradley Adams (40), Vice President and Treasurer. 700 Karnes Boulevard,
Kansas City, Missouri 64108-3306. Vice President and Treasurer, Jones &
Babson, Inc., and of each of the Babson Funds, Buffalo Funds, and J&B Funds;
Principal Financial Officer, Investors Mark Series Fund, Inc.

W. Guy Cooke (40), Vice President and Chief Compliance Officer. 700 Karnes
Boulevard, Kansas City, Missouri 64108-3306. Chief Compliance Officer, Jones
& Babson, Inc.; Vice President and Chief Compliance Officer of each of the
Babson Funds, Buffalo Funds, and J&B Funds. Mr. Cooke joined Jones &
Babson in March 1998 and previously was Director of Compliance at American
Century Companies.

Martin A. Cramer (51), Vice President and Secretary. 700 Karnes Boulevard,
Kansas City, Missouri 64108-3306. Vice President and Secretary, Jones &
Babson, Inc., and of each of the Babson Funds, Buffalo Funds, and J&B Funds;
Secretary, Investors Mark Series Fund, Inc.

Constance E. Martin (39), Vice President. 700 Karnes Boulevard, Kansas City,
Missouri 64108-3306. Assistant Vice President, Jones & Babson, Inc.; Vice
President of each of the Babson Funds, Buffalo Funds, and J&B Funds.

The Fund has an Audit Committee, which assists the Board of Trustees in
fulfilling its duties relating to the Fund's accounting and financial reporting
practices, and also serves as a direct line of communication between the Board
of Trustees and the independent auditors. The Audit Committee is comprised of
Messrs. Case, Betts, Gradinger and Kennedy, the Fund's Independent Trustees. The
specific functions of the Audit Committee include recommending the engagement or
retention of the independent auditors, reviewing with the independent auditors
the plan and results of the auditing engagement, approving professional services
provided by the independent auditors prior to the performance of such services,
considering the range of audit and non-audit fees, reviewing the independence of
the independent auditors, reviewing the scope and results of the Fund's
procedures for internal auditing, and reviewing the Fund's system of internal
accounting controls.

Compensation. The Fund does not directly compensate any Trustee or officer for
their normal duties and services. Mr. Gasaway and Mr. Soden, who are interested
Trustees due to their employment with the Fund's advisor and underwriter,
respectively, are compensated by those organizations and not by the Fund. The
fees of the Independent Trustees, including travel and other expenses related to
the Board meetings, are paid by Kornitzer pursuant to the provisions of the
Fund's Management Agreement.

Each Independent Trustee receives an annual retainer of $3,000 for serving on
the Board each of the Buffalo Funds and $125 for each Fund's Board meeting
attended. The Board of Trustees generally meets four times each year for each
Fund. The following chart sets forth the Trustees' annual compensation, all of
which is paid by Kornitzer.

Compensation for Pension or Total
Serving on the Retirement Compensation From
Name of Trustee Fund's Board Benefits Accrued Fund Complex

Stephen S. Soden -0- -0- -0-
Kent W. Gasaway -0- -0- -0-
Thomas S. Case $500 -0- $6,500
Gene M. Betts $500 -0- $6,500
J. Gary Gradinger $500 -0- $6,500
Philip J. Kennedy $500 -0- $6,500

As of December ___, 2001 the officers and Trustees as a group own less than
2.27% of the Fund.

Manager and Investment Advisor. Kornitzer serves as the Fund's manager and
investment advisor ("Advisor"). Kornitzer is a federally registered investment
advisory firm that was founded in 1989. It currently manages approximately $1.3
billion in assets for mutual funds, corporations, pensions and individuals. In
addition to the Buffalo Funds, Kornitzer serves as sub-advisor to the AFBA 5Star
Funds, a family of mutual funds sponsored by the Armed Forces Benefit
Association with objectives and policies substantially similar to that of the
Buffalo Funds.

Kornitzer is a closely-held corporation controlled by persons, who are active in
the management of the firm's business. John C. Kornitzer is the principal
stockholder of the firm and serves as the firm's president and Chairman of the
Board of Directors. Kent W. Gasaway, Thomas W. Laming and John C. Kornitzer each
own more than 5% of the firm.

Jones & Babson, Inc. serves as the Fund's underwriter, transfer agent and
fund accounting agent.

Certain officers and Trustees of the Trust are also officers or directors of
Jones & Babson, Inc. or Kornitzer or both. Jones & Babson, Inc. is a
wholly-owned subsidiary of Business Men's Assurance Company of America, which is
considered to be a controlling person under the Investment Company Act of 1940.
Assicurazioni Generali S.P.A., an insurance organization founded in 1831 based
in Trieste, Italy, is considered to be a controlling person and is the ultimate
parent of Business Men's Assurance Company of America. Mediobanca is a 5% owner
of Generali.

As compensation for its services, the Fund pays Kornitzer a fee at the annual
rate of one percent (1%) of average daily net assets from which Kornitzer pays
Jones & Babson, Inc. a fee of 50/100 of 1% (.50%) of average daily net
assets. Both fees are computed daily; the Fund pays Kornitzer's fee monthly.

Code of Ethics. The Fund, its Advisor and principal underwriter have each
adopted a code of ethics, as required by federal securities laws. Under each
code of ethics, persons who are designated as access persons may engage in
personal securities transactions, including transactions involving securities
that may be purchased or sold by any Fund, subject to certain general
restrictions and procedures. Each code of ethics contains provisions designed to
substantially comply with the recommendations contained in the Investment
Company Institute's 1994 Report of the Advisory Group on Personal Investing. The
codes of ethics are on file with the Securities and Exchange Commission.

Custodian. The Fund's assets are held for safe-keeping by an independent
custodian, UMB Bank, n.a. This means UMB Bank, n.a., rather than the Fund, has
possession of the Fund's cash and securities. UMB Bank, n.a. is not responsible
for the Fund's investment management or administration. But, as directed by Fund
officers, it delivers cash to those who have sold securities to a Fund in return
for such securities, and to those who have purchased securities from a Fund, it
delivers such securities in return for their cash purchase price. It also
collects income directly from issuers of securities owned by a Fund and holds
this for payment to shareholders after deduction of a Fund's expenses. The
custodian is compensated by Jones & Babson, Inc. out of the fees paid to it
by Kornitzer. There is no charge to the Fund.

Independent Auditors. The Fund's financial statements are audited by independent
auditors approved by the Trustees each year, and in years in which an annual
meeting is held the Trustees may submit their selection of independent auditors
to the shareholders for ratification. Ernst & Young LLP, One Kansas City
Place, 1200 Main Street, Suite 2000, Kansas City, Missouri 64105, is the Fund's
current auditor.

Control Persons and Principal Holders of the Funds. As of ______________, 2001
the Fund had _____control persons or principal holders. Control persons are
persons deemed to control a Fund because they own beneficially over 25% of the
outstanding equity securities. Principal holders are persons that own
beneficially 5% or more of a Fund's outstanding equity securities.

DISTRIBUTIONS AND TAXES

2001 Tax Act. On June 7, 2001, President Bush signed into law the Economic
Growth and Tax Relief Reconciliation Act of 2001 (the "Tax Act"). The Tax Act
includes provisions that significantly reduce individual income tax rates,
provide for marriage penalty relief, eliminate current phase-outs of the
standard deduction and personal exemptions, provide for additional savings
incentives for individuals, generally by increasing the maximum annual
contribution limits applicable to retirement and education savings programs, and
provide for limited estate, gift and generation-skipping tax relief. While these
provisions have an important tax impact on individual investors in the Fund,
their impact on the Fund itself are limited, as discussed in the following
paragraphs.

Distributions of Net Investment Income. The Fund receives income generally in
the form of dividends and interest on its investments. This income, less
expenses incurred in the operation of the Fund, constitutes the Fund's net
investment income from which dividends may be paid to shareholders. If you are a
taxable investor, any income the Fund pays to you will be taxable as ordinary
income, whether you take the income in cash or in additional shares.

Distributions of Capital Gains. In general, the Funds may derive capital gains
and losses in connection with sales or other dispositions of their portfolio
securities. Distributions from net short-term capital gains will taxable to you
as ordinary income. Distributions from net long-term capital gains will be
taxable to you as long-term capital gains, regardless of how long you have held
your shares in the Fund. Any net capital gains realized by a Fund generally will
be distributed once each year, but they may be distributed more frequently, if
necessary to reduce or eliminate excise or income taxes on the Fund.

Taxation of Five Year Gains (shareholders in the 10 and 15% federal brackets).
If you are in the 10 or 15% individual income tax bracket, capital gain
distributions are generally subject to a maximum rate of tax of 10%. However, if
you receive distributions from the Fund's sale of securities held for more than
five years, these gains are subject to a maximum rate of tax of 8%. The Fund
will inform you in January of the portion of any capital gain distributions you
received for the previous year that were five-year gains qualifying for this
reduced tax rate.

Taxation of Five Year Gains (shareholders in higher federal brackets). If you
are in a higher individual income tax bracket (for example, the 25, 28, 33 or
35% brackets when these brackets are fully phased-in in the year 2006) capital
gain distributions are generally subject to a maximum rate of tax of 20%.
Beginning in the year 2006, any distributions from the Fund's sale of securities
purchased after January 1, 2001 and held for more than five years will be
subject to a maximum rate of tax of 18%.

You may, however, elect to mark your Fund shares to market as of January 2,
2001. If you make this election, any Fund shares that you acquired before this
date will also be eligible for the 18% maximum rate of tax, beginning in 2006.
However, in making the election, you are required to pay a tax on any
appreciation in the value of your Fund shares as of January 2, 2001, and to
restart your holding period in the shares as of that date. The election does not
apply to Fund shares redeemed on or before January 2, 2002.

Information on the Amount and Tax Character of Distributions. The Fund will
inform you of the amount of your ordinary income dividends and capital gains
distributions at the time they are paid, and will advise you of their tax status
for federal income tax purposes shortly after the close of each calendar year.
If you have not held Fund shares for a full year, the Fund may designate and
distribute to you, as ordinary income or capital gains, a percentage of income
that is not equal to the actual amount of such income earned during the period
of your investment in the Fund.

Election To Be Taxed as a Regulated Investment Company. The Fund has elected to
be treated as a regulated investment company under Subchapter M of the Internal
Revenue Code and intends to so qualify during the current fiscal year. As
regulated investment companies, the Fund generally does not pay federal income
tax on the income and gains it distributes to you. The Board of Trustees
reserves the right not to maintain the Fund's qualification as a regulated
investment company, if it determines this course of action to be beneficial to
shareholders. In that case, the Fund will be subject to federal, and possibly
state, corporate taxes on its taxable income and gains, and distributions to you
will be taxed as ordinary dividend income to the extent of such Fund's earnings
and profits.

Excise Tax Distribution Requirements. To avoid federal excise taxes, the
Internal Revenue Code requires the Fund to distribute to you by December 31 of
each year, at a minimum, the following amounts: 98% of its taxable ordinary
income earned during the calendar year; 98% of its capital gain net income
earned during the twelve month period ending October 31; and 100% of any
undistributed amounts from the prior year. The Fund intends to declare and pay
these amounts in December (or in January that are treated by you as received in
December) to avoid these excise taxes, but can give no assurances that its
distributions will be sufficient to eliminate all taxes.

Redemption of Fund Shares. Redemptions, including redemptions in-kind, and
exchanges of Fund shares are taxable transactions for federal and state income
tax purposes. If you redeem your Fund shares, or exchange your Fund shares for
shares of a different Buffalo Fund of Babson Money Market Fund , the IRS will
require that you report any gain or loss on your redemption or exchange. If you
hold your shares as a capital asset, any gain or loss that you realize will be
capital gain or loss and will be long-term or short-term, generally depending on
how long you hold your shares. Any loss incurred on the redemption or exchange
of shares held for six months or less will be treated as a long-term capital
loss to the extent of any long-term capital gains distributed to you by the Fund
on those shares.

All or a portion of any loss that you realize upon the redemption of your Fund
shares will be disallowed to the extent that you buy other shares in the Fund,
through reinvestment of dividends or otherwise, within 30 days before or after
your share redemption. Any loss disallowed under these rules will be added to
your tax basis in the new shares you buy.

U.S. Government Obligations. Income earned on certain U.S. government
obligations is exempt from state and local personal income taxes if earned
directly by you. States also grant tax-free status to dividends paid to you from
interest earned on direct obligations o the U.S. government, subject in some
states to minimum investment or reporting requirements that must be met by the
Fund. Income on Fund investments in other certain obligations, such as
repurchase agreements collateralized by U.S. government obligations, commercial
paper and federal agency-backed obligations, for example Government National
Mortgage Association ("GNMA") or Federal National Mortgage Association ("FNMA")
obligations, generally does not qualify for tax-free treatment. The rules on
exclusion of this income are different for corporations.

Dividends-Received Deduction for Corporations. If you are a corporate
shareholder, you should note that the Fund anticipates only a small percentage
of any dividends the Fund pays are expected to qualify for the
dividends-received deduction. Qualifying dividends generally are limited to
dividends of domestic corporations. In some circumstances, you may be allowed to
deduct these qualified dividends, thereby reducing the tax that you would
otherwise be required to pay on these dividends. The dividends-received
deduction will be available only with respect to dividends designated by the
Fund as eligible for this treatment. All dividends, including the deducted
portion, must be included in your calculation of alternative minimum taxable
income.

Investment in Complex Securities. The Fund may invest in complex securities,
such as covered call options, that could affect whether gains and losses it
recognizes are treated as ordinary income or capital gains, or could affect the
amount, timing and/or tax character of income distributed to you. The Fund may
also invest in securities issued or purchased at a discount, such as zero coupon
securities, that could require it to accrue and distribute income not yet
received. In order to generate sufficient cash to make these distributions, the
Fund could be required to sell securities in its portfolio that it otherwise
might have continued to hold. These rules could affect the amount, timing and/or
tax character of income distributed to you.

FINANCIAL STATEMENTS

Financial statements for the Fund will be provided in a future filing, as
required by applicable law.

GENERAL INFORMATION AND HISTORY

Buffalo Mid Cap Fund is a series of Buffalo Funds. Buffalo Funds was organized
as a Delaware business trust on February 14, 2001, and is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
management investment company. An unlimited number of shares of beneficial
interest in the Trust were established and designated as the Buffalo Mid Cap
Fund and an unlimited number of shares have been allocated to such Fund. All
shares of the Fund issued by the Trust have the same rights and privileges as
other shares issued by the Fund. Each full and fractional share issued and
outstanding has (1) equal voting rights with respect to matters that affect the
Fund, and (2) equal dividend, distribution and redemption rights to the assets
of the Fund. Shares when issued are fully paid and non-assessable. The Trust may
create other series of shares of its beneficial interest. Shareholders do not
have pre-emptive or conversion rights.

Non-Cumulative Voting. Shares of the Fund have non-cumulative voting rights,
which means that the holders of 50% of the shares voting for the election of
Trustees can elect 100% of the Trustees, if they choose to do so, and in such
event, the holders of the remaining less than 50% of the shares voting will not
be able to elect any Trustees.

The Funds will not hold annual meetings except as required by the Investment
Company Act of 1940 and other applicable laws.

APPENDIX-CREDIT RATINGS

Description of Bond Ratings:

Standard & Poor's Corporation (S&P(R)).

AAA Highest Grade. These securities possess the ultimate degree of protection
as to principal and interest. Marketwise, they move with interest rates,
and hence provide the maximum safety on all counts.

AA High Grade. Generally, these bonds differ from AAA issues only in a small
degree. Here too, prices move with the long-term money market.

A Upper-medium Grade. They have considerable investment strength, but are not
entirely free from adverse effects of changes in economic and trade
conditions. Interest and principal are regarded as safe. They predominately
reflect money rates in their market behavior but, to some extent, also
economic conditions.

BBB Bonds rated BBB are regarded as having an adequate capacity to pay
principal and interest. Whereas they normally exhibit protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay principal and interest for
bonds in this category than for bonds in the A category.

BB, B, CCC, CC Bonds rated BB, B, CCC and CC are regarded, on balance, as
predominantly speculative with respect to the issuer's capacity to pay
interest and repay principal in accordance with the terms of the
obligations. BB indicates the lowest degree of speculation and CC the
highest degree of speculation. While such bonds will likely have some
quality and protective characteristics, these are outweighed by large
uncertainties or major risk exposures to adverse conditions.

Moody's Investors Service, Inc. (Moody's).

Aaa Best Quality. These securities carry the smallest degree of investment risk
and are generally referred to as "gilt-edge." Interest payments are
protected by a large, or by an exceptionally stable margin, and principal
is secure. While the various protective elements are likely to change, such
changes as can be visualized are most unlikely to impair the fundamentally
strong position of such issues.

Aa High Quality by All Standards. They are rated lower than the best bonds
because margins of protection may not be as large as in Aaa securities,
fluctuation of protective elements may be of greater amplitude, or there
may be other elements present which make the long-term risks appear
somewhat greater.

A Upper-medium Grade. Factors giving security to principal and interest are
considered adequate, but elements may be present which suggest a
susceptibility to impairment sometime in the future.

Baa Bonds that are rated Baa are considered as medium grade obligations, i.e.,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present, but certain protective
elements may be lacking or may be characteristically unreliable over any
great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.

Ba Bonds that are rated Ba are judged to have predominantly speculative
elements; their future cannot be considered as well assured. Often the
protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the
future. Uncertainty of position characterizes bonds in this class.

B Bonds that are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or maintenance of
other terms of the contract over any long period of time may be small.

Caa Bonds that are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to
principal or interest.

Ca Bonds that are rated Ca represent obligations that are speculative in a
high degree. Such issues are often in default or have other marked
shortcomings.

Description of Commercial Paper Ratings:

Moody's . . . Moody's commercial paper rating is an opinion of the ability of an
issuer to repay punctually promissory obligations not having an original
maturity in excess of nine months. Moody's has one rating - prime. Every such
prime rating means Moody's believes that the commercial paper note will be
redeemed as agreed. Within this single rating category are the following
classifications:

Prime - 1 Highest Quality
Prime - 2 Higher Quality
Prime - 3 High Quality

The criteria used by Moody's for rating a commercial paper issuer under this
graded system include, but are not limited to the following factors:

(1) evaluation of the management of the issuer;

(2) economic evaluation of the issuer's industry or industries and an appraisal
of speculative type risks which may be inherent in certain areas;

(3) evaluation of the issuer's products in relation to competition and customer
acceptance;

(4) liquidity;

(5) amount and quality of long-term debt;

(6) trend of earnings over a period of ten years;

(7) financial strength of a parent company and relationships which exist with
the issuer; and

(8) recognition by the management of obligations which may be present or may
arise as a result of public interest questions and preparations to meet
such obligations.

S&P . . .Standard & Poor's commercial paper rating is a current
assessment of the likelihood of timely repayment of debt having an original
maturity of no more than 270 days. Ratings are graded into four categories,
ranging from "A" for the highest quality obligations to "D" for the lowest. The
four categories are as follows:

A Issues assigned this highest rating are regarded as having the greatest
capacity for timely payment. Issues in this category are further refined
with the designations 1, 2, and 3 to indicate the relative degree of
safety.

A-1 This designation indicates that the degree of safety regarding timely
payment is very strong.

A-2 Capacity for timely payment on issues with this designation is strong.
However, the relative degree of safety is not as over-whelming.

A-3 Issues carrying this designation have a satisfactory capacity for timely
payment. They are, however, somewhat more vulnerable to the adverse effects
of changes in circumstances than obligations carrying the higher
designations.

B Issues rated "B" are regarded as having only an adequate capacity for
timely payment. Furthermore, such capacity may be damaged by changing
conditions or short-term adversities.

C This rating is assigned to short-term debt obligations with a doubtful
capacity for payment.

D This rating indicates that the issuer is either in default or is expected
to be in default upon maturity.

--------
1 Mr. Soden is considered an interested trustee, as defined in the Investment
Company Act of 1940, as amended, due to his employment with Jones &
Babson, Inc., the Fund's underwriter.
2 Mr. Gasaway is considered an interested trustee, as defined in the
Investment Company Act of 1940, as amended, due to his employment with
Kornitzer, the Fund's Advisor.

BUFFALO FUNDS

PART C

OTHER INFORMATION

ITEM 23. EXHIBITS.

(a) Charter Documents.

(1) Agreement and Declaration of Trust for Buffalo Funds dated
February 14, 2001 is incorporated herein by reference to that
Registrant's Registration Statement on Form N-1A (File Nos.
333-56018 and 811-10303) as filed with the SEC via EDGAR on
February 21, 2001.

(2) Officers' Certificate evidencing the creation of the Buffalo
Science and Technology Fund series of Buffalo Funds dated
September 17, 2001 is filed herewith as Exhibit No. EX-99.a.2.

(3) Officers' Certificate evidencing the creation of the Buffalo Mid
Cap Fund series of Buffalo Funds dated September 17, 2001 is
filed herewith as Exhibit No. EX-99.a.3.

(4) Certificate of Trust for Buffalo Funds as filed with the State of
Delaware on February 14, 2001 is incorporated herein by reference
to that Registrant's Registration Statement on Form N-1A (File
Nos. 333-56018 and 811-10303) as filed with the SEC via EDGAR on
February 21, 2001.

(b) By-laws.

By-Laws for Buffalo Funds are incorporated herein by reference to
Registrant's Registration Statement on Form N-1A (File Nos. 333-56018
and 811-10303) as filed with the SEC via EDGAR on February 21, 2001.

(See Article III, "Shares" and Article V "Shareholders' Voting Powers
and Meetings" of the Registrant's Agreement and Declaration of Trust.
See also, Article II, "Meetings of Shareholders" of the Registrant's
By-Laws. The Agreement and Declaration of Trust and the By-Laws of the
Buffalo Funds are incorporated herein by reference to the Registrant's
Registration Statement on Form N-1A (File Nos. 333-56018 and
811-10303) as filed with the SEC via EDGAR on February 21, 2001.

(d) Investment Advisory Contracts.

Management Agreement between Kornitzer Capital Management, Inc. and
Buffalo Funds, on behalf of the Buffalo Science & Technology Fund
series, dated February 14, 2001 is incorporated herein by reference to
Registrant's Registration Statement on Form N-1A (File Nos. 333-56018
and 811-10303) as filed with the SEC via EDGAR on June 7, 2001.
[Amendment to Management Agreement between Kornitzer Capital
Management, Inc. and Buffalo Funds dated February 14, 2001 adding
Buffalo Mid Cap Fund to be filed by amendment.]

(e) Underwriting Contracts.

Form of Underwriting Agreement between the Buffalo Funds, on behalf of
the Buffalo Science & Technology Fund series, and Jones &
Babson, Inc. is incorporated herein by reference to the Registrant's
Registration Statement on Form N-1A (File Nos. 333-56018 and
811-10303) as filed with the SEC via EDGAR on February 21, 2001.
[Amended Underwriting Agreement between Buffalo Funds and Jones &
Babson, Inc. to add Buffalo Mid Cap Fund to be filed by amendment.]

(f) Bonus or Profit Sharing Contracts.

Not Applicable.

(g) Custodian Agreements.

Custodian Agreement dated May 5, 1997 between UMB Bank, n.a. and each
Buffalo Fund is incorporated herein by reference to the Registration
Statement on Form N-1A (File Nos. 333-56018 and 811-10303) as filed
with the SEC via EDGAR on February 21, 2001. [Amendment to Custodian
Agreement dated May 5, 1997 between UMB Bank, n.a. to reflect the
addition of the Buffalo Mid cap Fund to be filed by amendment.]

(h) Other Material Contracts.

Form of Transfer Agency Agreement between Jones & Babson, Inc. and
Buffalo Funds dated is incorporated herein by reference to the
Registrant's Registration Statement on Form N-1A (File Nos. 333-56018
and 811-10303) as filed with the SEC via EDGAR on February 21, 2001.
[Amendment to Transfer Agency Agreement between Jones & Babson,
Inc. and Buffalo Funds to reflect the addition of Buffalo Mid cap Fund
to be filed by amendment.]

(i) Legal Opinions.

(1) Opinion and Consent of Counsel for Buffalo Funds to be filed by
amendment.

(j) Other Opinions.

(1) Consents of Auditors. Not applicable.

(2) Powers of Attorney.

Power of Attorney for Buffalo Funds and its series is
incorporated herein by reference to Registrant's Registration
Statement on Form N-1A (File Nos. 333-56018 and 811-10303) as
filed with the SEC via EDGAR on February 21, 2001.

(k) Omitted Financial Statements.

Not Applicable.

(l) Initial Capital Agreements.

Not Applicable.

(m) Rule 12b-1 Plan.

Not Applicable.

(n) Rule 18f-3 Plan.

Not Applicable.

(o) Not Applicable.

(p) Codes of Ethics.

(1) The Code of Ethics of each of the Registrants and the
underwriter, Jones & Babson, Inc., is incorporated herein by
reference to Buffalo Funds' Registration Statement on Form N-1A
(File Nos. 333-56018 and 811-10303) as filed with the SEC via
EDGAR on February 21, 2001.

(2) The Code of Ethics of Kornitzer Capital Management, Inc., is
incorporated herein by reference to the amendment to the Buffalo
Funds' joint Registration Statement on Form N-1A (File Nos.
333-56018 and 811-10303) as filed with the SEC via EDGAR on
February 21, 2001.

ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE REGISTRANT.

None.

ITEM 25. INDEMNIFICATION.

Article VII, Section 2(a) of the Agreement and Declaration of Trust
provides that to the fullest extent that limitations on the liability of
Trustees and officers are permitted by the Delaware Business Trust Act, the
officers and Trustees shall not be responsible or liable in any event for any
act or omission of: any agent or employee of the Trust; any Investment Adviser
or Principal Underwriter of the Trust; or with respect to each Trustee and
officer, the act or omission of any other Trustee or officer, respectively. The
Trust, out of the Trust Property, shall indemnify and hold harmless each and
every officer and Trustee from and against any and all claims and demands
whatsoever arising out of or related to such officer's or Trustee's performance
of his or her duties as an officer or Trustee of the Trust. This limitation on
liability applies to events occurring at the time a Person serves as a Trustee
or officer of the Trust whether or not such Person is a Trustee or officer at
the time of any proceeding in which liability is asserted. Nothing herein
contained shall indemnify, hold harmless or protect any officer or Trustee from
or against any liability to the Trust or any Shareholder to which such Person
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of such
Person's office.

Article VII, Section 2(b) provides that every note, bond, contract,
instrument, certificate or undertaking and every other act or document
whatsoever issued, executed or done by or on behalf of the Trust, the officers
or the Trustees or any of them in connection with the Trust shall be
conclusively deemed to have been issued, executed or done only in such Person's
capacity as Trustee and/or as officer, and such Trustee or officer, as
applicable, shall not be personally liable therefore, except as described in the
last sentence of the first paragraph of Section 2 of Article VII.

ITEM 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER.

Kornitzer Capital Management, Inc. is a federally registered investment
adviser that provides investment management services to the Buffalo Funds family
of mutual funds and the AFBA 5Star Funds family of funds. Kornitzer also manages
the assets of non-fund advisory clients.

ITEM 27. PRINCIPAL UNDERWRITER.

(a) Jones & Babson, Inc., the only principal underwriter of the
Registrant, also acts as principal underwriter for the following:

David L. Babson Growth Fund, Inc.
Babson Enterprise Fund, Inc.
Babson Enterprise Fund II, Inc.
D.L. Babson Money Market Fund, Inc.
-Babson Money Market Fund
D.L. Babson Tax-Free Income Fund, Inc.
-Babson Tax-Free Income Fund
D.L. Babson Bond Trust
-Portfolio L
-Portfolio S
Babson Value Fund, Inc.
Shadow Stock Fund, Inc.
Babson-Stewart Ivory International Fund, Inc.
Buffalo Balanced Fund, Inc.
Buffalo Equity Fund, Inc.
Buffalo High Yield Fund, Inc.
Buffalo Small Cap Fund, Inc.
Buffalo USA Global Fund, Inc.
Buffalo Funds
-Buffalo Science & Technology Fund
-Buffalo Mid-Cap Fund
Investors Mark Series Fund, Inc.
J&B Funds
-J&B Small-Cap International Fund
-J&B Small-Cap Aggressive Growth Fund
-J&B Mid-Cap Aggressive Growth Fund

(b) Herewith is the information required by the following table with
respect to each director, officer or partner of the only underwriter
named in answer to Item 20 of Part B:

Name and Principal Position & Offices Positions & Offices
Business Address with Underwriter with Registrant
Stephen S. Soden Chairman and President, Chairman,
700 Karnes Blvd. Director and Trustee
Kansas City, MO
64108-3306
Michael K. Deardorff Director None
700 Karnes Blvd.
Kansas City, MO
64108-3306
David A. Gates Director None
700 Karnes Blvd.
Kansas City, MO
64108-3306
Edward S. Ritter Director None
700 Karnes Blvd.
Kansas City, MO
64108-3306
Robert N. Sawyer Director None
700 Karnes Blvd.
Kansas City, MO
64108-3306
David L. Higley Director None
700 Karnes Blvd
Kansas City, MO
64108-3306
P. Bradley Adams Director Vice President and
700 Karnes Blvd. Vice President and Treasurer
Kansas City, MO Treasurer
64108-3306
Martin A. Cramer Vice President and Vice President and
700 Karnes Blvd. Secretary Secretary
Kansas City, MO
64108-3306

(c) The principal underwriter does not receive any remuneration or compensation
for the duties or services rendered to the Registrant pursuant to the
principal underwriting agreement.

ITEM 28. LOCATION OF ACCOUNTS AND RECORDS.

Each account, book or other document required to be maintained by Section
31(a) of the Investment Company Act of 1940, as amended and Rules (17 CFR
270-31a-1 to 31a-3) promulgated thereunder, is in the physical possession of
Jones & Babson, Inc., at BMA Tower, 700 Karnes Blvd., Kansas City, Missouri
64108-3306 and Kornitzer Capital Management, Inc., 5420 West 61st Place, Shawnee
Mission, KS, 66205-3084.

ITEM 29. MANAGEMENT SERVICES.

There are no management related service contracts not discussed in Part A
or
Part B.

ITEM 30. UNDERTAKINGS.

Registrant undertakes that, if requested to do so by the holders of at
least 10% of the Registrant's outstanding shares, to call a meeting of
shareholders for the purpose of voting upon the question of removal of a
director or directors and to assist in communications with other shareholders as
required by Section 16(c) of the Investment Company Act of 1940, as amended.

Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to Trustees, officers and controlling persons of the
Registrant pursuant to the provisions described in response to item 25, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a Trustee, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such Trustee, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended (the
"1933 Act") and the Investment Company Act of 1940, as amended, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, duly authorized, in the City of Kansas City, and the State of
Missouri on the 17th day of September, 2001.

Buffalo Funds

/s/ Stephen S. Soden
Stephen S. Soden
Chairman and President

Pursuant to the requirements of the 1933 Act, this Registration Statement has
been signed below by the following persons in the capacities and the date(s)
indicated.

Signature Title Date

/s/ Stephen S. Soden President, Treasurer and September 17, 2001
Stephen S. Soden Principal Financial Officer

/s/ P. Bradley Adams Vice President and Treasurer September 17, 2001
P. Bradley Adams

/s/ Gene M. Betts * Trustee September 17, 2001
Gene M. Betts

/s/ Thomas S. Case * Trustee September 17, 2001
Thomas S. Case

/s/ Kent W. Gasaway * Trustee September 17, 2001
Kent W. Gasaway

/s/ J. Gary Gradinger * Trustee September 17, 2001
J. Gary Gradinger

/s/ Philip J. Kennedy * Trustee September 17, 2001
Philip J. Kennedy

* By: /s/ P. Bradley Adams
P. Bradley Adams
(Pursuant to Power of Attorney)

EXHIBIT INDEX

Exhibit Exhibit No.

Officers' Certificate evidencing the creation of the Buffalo
Science & Technology Fund EX-99.a.2

Officers' Certificate evidencing the creation of the Buffalo
Mid Cap Fund EX-99.a.3

EXHIBIT EX-99.a.2

BUFFALO FUNDS

OFFICERS' CERTIFICATE

THE UNDERSIGNED, Secretary of Buffalo Funds (the "Trust"), a Delaware business
trust registered as an open-end, management investment company under the
Investment Company Act of 1940, as amended, does hereby certify that the
following preambles and resolutions designating an initial series of shares of
the Trust were duly adopted at the organizational meeting of the Board of
Trustees of the Trust held on February 14, 2001, all in accordance with the laws
of the State of Delaware and pursuant to Article III, Sections 1, 5 and 6 of the
Trust's Agreement and Declaration of Trust, and that such resolutions are
incorporated by reference into the Agreement and Declaration of Trust in
accordance with Article III, Section 6 thereof:

WHEREAS, Section 1 of Article III of the Agreement and Declaration of Trust
of the Trust provides that the beneficial interest of the Trust is divided
into an unlimited number of shares of beneficial interest, no par value,
and Section 6 of Article III authorizes the Board of Trustees to divide the
shares into separate series, and to divide such series into separate
classes of shares, with such variations in the relative rights and
preferences between the different series or classes as shall be fixed and
determined by the Trustees; and

WHEREAS, the Board desires to establish and designate the initial series of
shares of beneficial interest in the Trust.

NOW, THEREFORE, IT IS

RESOLVED, that, pursuant to Article III, Section 6, of the Trust's
Agreement and Declaration of Trust, a series of shares of beneficial
interest in the Trust is hereby established and designated as the Buffalo
Science & Technology Fund, and an unlimited number of shares of
beneficial interest are hereby classified and allocated to such series, all
with the relative rights and preferences as set forth in the Agreement and
Declaration of Trust or any amendments thereto; and it is

FURTHER RESOLVED, that the appropriate officers of the Trust be, and each
of them hereby is, authorized and directed to prepare a certificate
evidencing the Board's above designation of the Trust's initial series of
shares of beneficial interest and to insert a copy of such certificate in
the Trust's minute book and to see that a copy is kept at the Trust's
principal office for the transaction of its business.

IN WITNESS WHEREOF, I have hereunto set my hand as such officer of the
Trust as of this 17th day of September, 2001.

/s/ Martin A. Cramer
Name & Title: Martin A. Cramer, Secretary

EXHIBIT EX-99.a.3

BUFFALO FUNDS

OFFICERS' CERTIFICATE

THE UNDERSIGNED, Secretary of Buffalo Funds (the "Trust"), a Delaware business
trust registered as an open-end, management investment company under the
Investment Company Act of 1940, as amended, does hereby certify that the
following preambles and resolutions designating an additional series of shares
of the Trust were duly adopted at a meeting of the Board of Trustees of the
Trust held on August 10, 2001, all in accordance with the laws of the State of
Delaware and pursuant to Article III, Sections 1, 5 and 6 of the Trust's
Agreement and Declaration of Trust, and that such resolutions are incorporated
by reference into the Agreement and Declaration of Trust in accordance with
Article III, Section 6 thereof:

WHEREAS, the Board desires to establish and designate an additional series
of shares of beneficial interest in the Trust.

NOW, THEREFORE, IT IS

RESOLVED, that, pursuant to Article III, Section 6, of the Trust's
Agreement and Declaration of Trust, a series of shares of beneficial
interest in the Trust is hereby established and designated as the Buffalo
Mid Cap Fund, and an unlimited number of shares of beneficial interest are
hereby classified and allocated to such series, all with the relative
rights and preferences as set forth in the Agreement and Declaration of
Trust or any amendments thereto; and it is

FURTHER RESOLVED, that the appropriate officers of the Trust be, and each
of them hereby is, authorized and directed to prepare a certificate
evidencing the Board's above designation of an additional series of shares
of the Trust's beneficial interest and to insert a copy of such certificate
in the Trust's minute book and to see that a copy is kept at the Trust's
principal office for the transaction of its business.

IN WITNESS WHEREOF, I have hereunto set my hand as such officer of the
Trust as of this 17th day of September, 2001.

/s/ Martin A. Cramer
Name & Title: Martin A. Cramer, Secretary