<PAGE>
497(e)
File Nos. 333-16093 and 811-07923
[LOGO]
CALIFORNIA TAX EXEMPT FUND
CLASS S
PROSPECTUS
DATED MAY 1, 1999
INVESTMENT MANAGER:
CITY NATIONAL INVESTMENTS
A division of City National Bank
The Securities and Exchange Commission has not approved or
disapproved these securities or passed upon the accuracy or
adequacy of this prospectus. Any representation to the contrary
is a criminal offense.
------------------------------------------------------------------------------
MUTUAL FUND SHARES ARE NOT FDIC INSURED. MUTUAL FUND SHARES ARE
NOT BANK DEPOSITS, NOR ARE THEY OBLIGATIONS OF, OR GUARANTEED BY
CITY NATIONAL BANK. INVESTING IN MUTUAL FUNDS INVOLVES RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
<PAGE>
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
Overview................................................ 4
OUR GOALS......................................... 4
HOW WE PLAN TO ACHIEVE OUR GOALS.................. 4
TYPES OF SECURITIES............................... 4
CLASSES OF SHARES................................. 5
PRINCIPAL RISKS OF INVESTING IN OUR FUND.......... 5
PAST PERFORMANCE.................................. 6
Understanding Expenses.................................. 7
FEES AND EXPENSES OF THE FUND..................... 7
EXAMPLE........................................... 8
Management of the Fund.................................. 9
INVESTMENT MANAGER................................ 9
SUB-ADVISER....................................... 9
ADMINISTRATOR, FUND ACCOUNTANT AND TRANSFER
AGENT............................................. 10
DISTRIBUTOR....................................... 10
Account Policies........................................ 11
Understanding Earnings and Taxes........................ 12
How to Buy and Sell Shares.............................. 14
HOW TO PLACE AN ORDER............................. 14
BUYING SHARES..................................... 15
SELLING SHARES.................................... 15
Important Terms to Know................................. 17
KEY DEFINITIONS................................... 17
For More Information .................................. back cover
</TABLE>
More detailed information on all subjects covered in this simplified prospectus
is contained within the STATEMENT OF ADDITIONAL INFORMATION ("SAI"). Investors
seeking more in-depth explanations of the Fund should request the SAI and review
it before purchasing shares.
3
<PAGE>
OVERVIEW
OUR GOALS
The Fund is a tax exempt money market fund that seeks to preserve your
principal and maintain a high degree of liquidity while providing current
income that is exempt from federal, and to the extent possible,
California personal income tax. Also, the Fund seeks to maintain a $1.00
per share net asset value. The goals of the Fund can only be changed with
shareholder approval.
HOW WE PLAN TO ACHIEVE OUR GOALS
OUR PRINCIPAL STRATEGIES -- We purchase liquid, high-quality, short-term
California municipal money market securities. We invest at least 80% of
the Fund's net assets in municipal money market securities that pay
interest that is expected to be exempt from federal income tax and which
is not a preference item for purposes of the federal alternative minimum
tax (the "AMT"). This may mean that, although we do not intend to, up to
20% of the securities we may invest in may be subject to the AMT. We
invest at least 65% of the Fund's net assets in municipal obligations the
interest on which is exempt from California personal income tax. The
securities must have a maturity period of no more than 397 days and, in
our opinion, present minimal credit risk.
TYPES OF SECURITIES
The Fund invests primarily in money market instruments including:
- Securities that pay interest which is not a preference item for
purposes of federal alternative minimum tax;
- Municipal obligations that pay interest which is expected to be
exempt from California personal income taxes; and
- High-quality municipal bonds, notes and tax exempt commercial
paper. High-quality municipal securities are those rated within
the two highest short-term grades by nationally recognized
statistical rating organizations such as Standard & Poor's
Ratings Group and/ or Moody's Investors Services.
4
<PAGE>
Please review the SAI for more detailed descriptions of these principal
investments and other securities in which the Fund may invest in addition
to the types of securities described above.
CLASSES OF SHARES
This Prospectus offers Class S shares of the Fund. The Fund also offers
other classes of shares, which are subject to the same expenses, except
they may be subject to different distribution and/or shareholder
servicing costs.
PRINCIPAL RISKS OF INVESTING IN OUR FUND
As with any money market fund, there are risks to investing. We cannot
guarantee that we will meet our investment goals. Here are the principal
risks to consider:
MAINTAINING THE NET ASSET VALUE -- We cannot guarantee that the Fund will
be able to maintain a stable net asset value of $1.00 per share. You may
lose money by investing in the Fund.
NO FEDERAL GUARANTEES -- As with any money market mutual fund, an
investment in the Fund is not a deposit of a bank and is not insured,
guaranteed, or protected by the FDIC, Federal Reserve Board, or any
agency of the U.S. Government.
CALIFORNIA RISK FACTORS -- The Fund may be subject to greater risks than
other tax exempt money market funds that are diversified across issuers
located in a number of states. Because the Fund concentrates its
investments in California municipal securities, the Fund is vulnerable to
changes in California's economy that may lessen the ability of California
municipal bond issuers to pay interest and principal on their bonds.
TAXES -- Although the Fund's goal is to provide income exempt from
federal and California state personal income taxes, some of its income
may be subject to the alternative minimum tax.
5
<PAGE>
THE EFFECT OF INTEREST RATES -- A money market fund's yield is affected
by interest rate changes. When rates decline, the fund's yield will tend
to be somewhat higher than prevailing market rates. When rates rise, the
fund's yield may tend to be somewhat lower.
ISSUER DEFAULT -- We may not be able to maintain a $1.00 per share value
if the issuers of securities do not make their principal or interest
payments on time. We attempt to minimize the risk of default by
purchasing only highly-rated securities.
DEFENSIVE INVESTMENTS -- At the discretion of the investment manager or
sub-adviser to the Fund, the Fund may invest up to 100% of its assets in
municipal obligations of states other than California or taxable money
market securities for temporary defensive purposes. Such a stance may
help the Fund minimize or avoid losses during adverse market, economic or
political conditions. During such a period, the Fund may not achieve its
investment goals.
YEAR 2000 -- Many computer systems cannot distinguish the year 2000 from
1900. This is known as the "Year 2000" problem. A computer system's
inability to tell the difference could cause problems with the handling
of securities trades, pricing and account services. Our software vendors
and service providers have assured us, but have not guaranteed, that
their systems will be adapted in time to avoid serious problems. We do
not expect Year 2000 conversion costs to have much direct impact on the
Fund because these costs are borne primarily by the Fund's vendors and
service providers, and not directly by the Fund. It is also important to
keep in mind that the Year 2000 problem may negatively impact the State
of California and therefore, the municipal obligations and other
securities in which the Fund invests and, by extension, the value of the
shares held by the Fund.
PAST PERFORMANCE
The Fund is a new series of the Trust and has recently commenced
operations. Therefore, no past performance information is available.
If you would like to know the Fund's current seven-day yield, call
1-888-889-0799.
6
<PAGE>
UNDERSTANDING EXPENSES
FEES AND EXPENSES OF THE FUND
This table describes the fees and expenses you may pay if you buy and
hold shares of the Fund. You pay no sales charges or transaction fees for
buying or selling shares of the Fund.
ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
<TABLE>
<S> <C> <C>
Management Fee* 0.27%
Distribution (12b-1) Fee 0.50%
Other Expenses
Shareholder Servicing Fee 0.25%
Other Fund Expenses** 0.20%
Total Other Expenses** 0.45%
---------
Total Annual Fund Operating Expenses*** 1.22%
</TABLE>
* The "Management Fee" is an annual fee, payable monthly out of the
Fund's net assets.
** Estimated.
*** The "Total Annual Fund Operating Expenses" is an estimate and may be
higher or lower than that outlined above. The investment manager has
voluntarily agreed to limit its fees or reimburse the Fund for expenses
to the extent necessary to keep Total Annual Fund Operating Expenses at
or below 0.98%. Any fee reductions or reimbursements may be repaid to the
investment manager within 3 years after they occur if such repayments can
be achieved within the Fund's then current expense limit, if any, for
that year and if certain other conditions are satisfied.
7
<PAGE>
EXAMPLE
The Example is intended to help you compare the cost of investing in the
Fund with the cost of investing in other money market funds. It 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. Your actual costs may be
higher or lower. The Example should not be considered a representation of
past or future expenses or performance.
Based on these assumptions your costs would be:
<TABLE>
<S> <C>
1 Year 3 Years
------ ---------
$124 $387
</TABLE>
8
<PAGE>
MANAGEMENT OF THE FUND
INVESTMENT MANAGER
City National Bank ("CNB") is the Fund's investment manager. As
investment manager, CNB provides the Fund with investment management
services, including the selection, appointment, and supervision of the
sub-adviser to the Fund. CNB receives 0.27% of average annual net assets
of the Fund for its investment management services.
CNB, founded in the early 1950's, is a federally chartered commercial
bank with approximately $6.3 billion in assets as of March 31, 1999. It
is a wholly-owned subsidiary of City National Corporation, a New York
Stock Exchange listed company. CNB's address is 400 North Roxbury Drive,
Beverly Hills, California 90210.
CNB is applying for an exemptive order from the Securities and Exchange
Commission which would permit it, subject to certain conditions required
by the SEC, to replace the current sub-adviser with a new sub-adviser
with the approval of the Board of Trustees but without obtaining
shareholder approval. Shareholders, however, will be notified of any
change of the sub-adviser and be provided with information regarding the
new sub-adviser. An order from the SEC granting this exemption benefits
shareholders by enabling the Fund to operate in a less costly and more
efficient manner.
SUB-ADVISER
Weiss, Peck & Greer, L.L.C. ("WP&G") currently serves as the Fund's sub-
adviser pursuant to a sub-advisory agreement between the investment
manager and WP&G. Under the sub-advisory agreement, WP&G provides
investment advisory and portfolio management services to the Fund. WP&G
is located at One New York Plaza, New York, New York 10004. WP&G has been
in the investment management business since 1970, and engages in
investment management, venture capital management and management buyouts.
Since its founding, WP&G has been active in managing portfolios of tax
exempt
9
<PAGE>
securities. As of March 31, 1999, WP&G had assets under management
totaling approximately $15.6 billion.
ADMINISTRATOR, FUND ACCOUNTANT AND TRANSFER AGENT
SEI Investments Mutual Funds Services serves as administrator and fund
accountant to the Fund. SEI Investments Fund Management serves as
transfer agent for the Fund. Both companies are located at One Freedom
Valley Drive, Oaks, Pennsylvania 19456 and can be reached at
1-888-889-0799.
DISTRIBUTOR
SEI Investments Distribution Co. (the "Distributor") serves as the Fund's
distributor pursuant to a distribution agreement with the Fund. The
Distributor is located at One Freedom Valley Drive, Oaks, Pennsylvania,
19456 and can be reached at 1-888-889-0799.
10
<PAGE>
ACCOUNT POLICIES
HOW WE PRICE SHARES -- Shares are priced at net asset value (NAV) which
is expected to remain constant at $1.00. The NAV is calculated by adding
the values of all securities and other assets of the Fund, subtracting
the liabilities, and dividing the net amount by the number of outstanding
shares. Securities are valued at amortized cost, which approximates
market value.
WHEN SHARES ARE PRICED -- NAV calculations are made once each day,
usually by 2:00 p.m. Eastern time. Shares may be purchased on any day
that the New York Stock Exchange and the Federal Reserve are open for
business. Shares, however, cannot be purchased by Federal Reserve wire on
days when either the New York Stock Exchange or the Federal Reserve is
closed.
REPORTING FUND PERFORMANCE -- From time to time the Fund may advertise
its yield and effective yield. Performance figures are based upon
historical results and are not intended to indicate future performance.
If you have any questions about the Fund, please call the Fund at
1-888-889-0799.
11
<PAGE>
UNDERSTANDING EARNINGS AND TAXES
DECLARING AND PAYING DIVIDENDS -- Dividends are declared daily and paid
monthly. Dividends are normally paid on the last business day of each
month. Net capital gain, if any, will be paid once a year.
WHEN DO DIVIDENDS ACCRUE? -- Your dividends begin to accrue on the day of
purchase for shares bought before 2:00 p.m. Eastern time. They begin to
accrue on the following day for shares purchased after 2:00 p.m. Eastern
time. You will not be credited with dividends for shares on the day you
sell them.
DISTRIBUTION OPTIONS -- Your dividends will be automatically reinvested
in additional full or fractional shares, unless you instruct the Fund in
writing prior to the date of distribution of your election to receive
payment in cash. Your election will be effective for all dividends and
distributions paid after the Fund receives your written notice. To cancel
your election, please send the Fund another written notice. Proceeds from
distributions will normally be wired to your financial institution on the
business day after distributions are credited to your account.
TAX CONSIDERATIONS -- The Fund intends to distribute substantially all of
its net investment income (including net short-term capital gain) to
shareholders. If, at the close of each quarter of its taxable year, at
least 50% of the value of the Fund's total assets consists of obligations
the interest on which is excludable from gross income for federal income
tax purposes, the Fund may pay "exempt-interest dividends" to its
shareholders. Exempt-interest dividends are excludable from a
shareholder's gross income for federal income tax purposes, but may have
certain collateral federal tax consequences including alternative minimum
tax consequences.
The Fund also intends to qualify to pay dividends to shareholders that
are exempt from California personal income tax ("California
exempt-interest dividends"). The Fund will qualify to pay California
exempt-interest dividends
12
<PAGE>
if (1) at the close of each quarter of the Fund's taxable year, at least
50% of the value of the Fund's total assets consists of obligations the
interest on which would be exempt from California personal income tax if
the obligations were held by an individual ("California Tax Exempt
Obligations") and (2) the Fund continues to qualify as a regulated
investment company. The Fund will notify its shareholders of the amount
of exempt-interest dividends each year.
You will be notified at least annually about the tax consequences of
distributions made each year. BE SURE TO CONSULT YOUR TAX ADVISOR ABOUT
THE SPECIFIC TAX IMPLICATIONS OF YOUR INVESTMENTS. FOR ADDITIONAL
INFORMATION REGARDING TAX CONSIDERATIONS, SEE THE SAI.
BACKUP WITHHOLDING -- You must provide your financial institution with
your social security or tax identification number on your account
application form and specify whether or not you are subject to backup
withholding. Otherwise, you may be subject to backup withholding at a
rate of 31%.
13
<PAGE>
HOW TO BUY AND SELL SHARES
Here are the details you should know about buying and selling shares:
HOW TO PLACE AN ORDER
You may place an order with:
- an approved broker-dealer; or
- any other approved financial institution.
ORDERING THROUGH A BROKER-DEALER OR FINANCIAL INSTITUTION -- You may
purchase shares through accounts with brokers and other financial
institutions that are authorized to place trades in Fund shares for their
customers. If you invest through an authorized institution, you will have
to follow its procedures, which may be different from the procedures for
investing directly. Your financial institution may charge a fee for its
services, in addition to the fees charged by the Fund. You will also
generally have to address your correspondence or questions regarding the
Fund to your financial institution.
WHEN ORDERS WILL BE COMPLETED -- You may have to transmit purchase or
exchange requests to your financial institution at an earlier time for
your transaction to become effective that day. This allows the financial
institution time to process your request and transmit it to the Fund. For
more information about how to purchase or exchange fund shares through
your financial institution, you should contact your financial institution
directly.
If we receive your purchase order, through your financial institution,
before 2:00 p.m. Eastern time, the order will be executed that same day.
Orders received after 2:00 p.m. Eastern time will be executed the
following business day. Your shares will be bought only after we receive
a properly completed order with full payment.
14
<PAGE>
PURCHASE MINIMUMS -- You may buy shares for an initial amount of
$100,000. This is the required minimum account balance. You may buy
additional shares for $1,000 or more. However, in order to reach or
maintain these purchase and account balance minimums your broker-dealer
or financial institution may aggregate your purchase with the purchases
of its other clients. Further exceptions to the purchase minimum
requirement may be made at our discretion.
MINIMUM ACCOUNT BALANCES -- If your account balance drops below the
required minimum because of redemptions, the Fund may redeem your shares.
However, the Fund will always give you at least 30 days' written notice
to give you time to add to your account and avoid involuntary redemption
of your shares.
PAYMENT RESTRICTIONS -- We only accept payments by wire in U.S. funds.
Cash, checks and third-party checks will not be accepted. Consult with
your financial institution about their acceptable methods of payment.
WIRING FEE -- The financial institution placing your order may charge its
own wiring fees.
BUYING SHARES
FIRST TIME AND SUBSEQUENT PURCHASES -- You will have to follow your
broker-dealer or financial institution's procedures for transacting with
the Fund. Contact your broker-dealer or financial institution for more
information.
SELLING SHARES
GENERAL INFORMATION -- You may sell your shares by contacting your
broker-dealer or financial institution. You will have to follow their
procedures. Contact your broker-dealer or financial institution for more
information.
15
<PAGE>
GENERAL RESTRICTIONS -- We may suspend the right to sell shares or
postpone payment for a sale of shares when either the New York Stock
Exchange or the Federal Reserve's Fedline System is closed or restricted.
We reserve the right to reject any order that is not received in proper
form. For example, if we are unable to determine how many shares you wish
to sell, we may not execute your order.
OTHER REDEMPTION OPTIONS -- Under conditions where cash redemptions are
detrimental to the Fund and its shareholders, we reserve the right to
make redemptions in readily marketable securities other than cash. In
unusual circumstances, the Fund may temporarily suspend the processing of
sell requests, or postpone payments of proceeds for up to five business
days, as permitted by federal securities laws. Please see the SAI for a
more detailed discussion.
CONFIRMING AUTHENTICITY -- We will take steps in an effort to verify that
an order is authentic. To do so, we may:
- ask for a form of personal identification or written
confirmation of instructions; and
- tape record your telephone instructions.
We reserve the right to refuse an order if we cannot reasonably confirm
the authenticity of the instructions.
LIABILITY -- We may be liable for losses from unauthorized or fraudulent
telephone transactions only if reasonable steps are not taken to verify
an order's authenticity.
16
<PAGE>
IMPORTANT TERMS TO KNOW
KEY DEFINITIONS
"We", "Us" and "Our" means the CNI Charter California Tax Exempt Fund.
"You" and "Your" means the prospective investor or current shareholder.
"Liquidity" means the ability to turn investments into cash.
"Quality" means the credit rating given to a security by a nationally
recognized statistical rating organization.
"Yield" means the interest rate you would receive if you kept your
investment in the Fund for a year. It is based on the current interest
rate for a trailing seven-day period.
"Effective Yield" means the interest rate, compounded weekly, you would
receive if you kept your investment in the Fund for a year.
17
<PAGE>
FOR MORE INFORMATION
CNI CHARTER CALIFORNIA TAX EXEMPT FUND
Additional information is available free of charge in the STATEMENT OF
ADDITIONAL INFORMATION ("SAI"). The SAI is incorporated by reference (legally
considered part of this document). Additional information about the Fund's
investments is available in the Fund's Annual and Semi-Annual Reports to
shareholders. In the Fund's Annual Report, you will find a discussion of the
market conditions and investment strategies that significantly affected the
Fund's performance during its last fiscal year. To receive a free copy of this
Prospectus, the SAI, or the Annual or Semi-Annual Reports (when available),
please contact:
SEI Investments Distribution Co.
One Freedom Valley Drive
Oaks, Pennsylvania 19456
1-888-889-0799
INFORMATION ABOUT THE FUND MAY BE REVIEWED AND COPIED:
- - at the SEC's Public Reference Room in Washington, D.C. at 1-800-SEC-0330;
- - on the SEC's Internet site at www.sec.gov; or
- - by written request (including duplication fee) to the Public Reference
Section of the SEC, Washington, D.C. 20549-6009.
FOR THE CURRENT SEVEN-DAY YIELD, OR IF YOU HAVE QUESTIONS ABOUT THE FUND, PLEASE
CALL 1-888-889-0799.
The Fund's Investment Company Act
file number: 811-07923.
[LOGO]
CALIFORNIA
TAX EXEMPT FUND
CLASS S
PROSPECTUS
DATED MAY 1, 1999
CNI-F-006-01
<PAGE>
497(e)
File Nos. 333-16093 and 811-07923
[LOGO]
GOVERNMENT FUND
CLASS S
PROSPECTUS
DATED MAY 1, 1999
INVESTMENT MANAGER:
CITY NATIONAL INVESTMENTS
A division of City National Bank
The Securities and Exchange Commission has not approved or
disapproved these securities or passed upon the accuracy or
adequacy of this prospectus. Any representation to the contrary
is a criminal offense.
------------------------------------------------------------------------------
MUTUAL FUND SHARES ARE NOT FDIC INSURED. MUTUAL FUND SHARES ARE
NOT BANK DEPOSITS, NOR ARE THEY OBLIGATIONS OF, OR GUARANTEED BY
CITY NATIONAL BANK. INVESTING IN MUTUAL FUNDS INVOLVES RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
<PAGE>
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
Overview................................................ 4
OUR GOALS......................................... 4
HOW WE PLAN TO ACHIEVE OUR GOALS.................. 4
TYPES OF SECURITIES............................... 4
CLASSES OF SHARES................................. 5
PRINCIPAL RISKS OF INVESTING IN OUR FUND.......... 5
PAST PERFORMANCE.................................. 6
Understanding Expenses.................................. 7
FEES AND EXPENSES OF THE FUND..................... 7
EXAMPLE........................................... 8
Management of the Fund.................................. 9
INVESTMENT MANAGER................................ 9
SUB-ADVISER....................................... 9
ADMINISTRATOR, FUND ACCOUNTANT AND TRANSFER
AGENT............................................. 10
DISTRIBUTOR....................................... 10
Account Policies........................................ 11
Understanding Earnings and Taxes........................ 12
How to Buy and Sell Shares.............................. 14
HOW TO PLACE AN ORDER............................. 14
BUYING SHARES..................................... 15
SELLING SHARES.................................... 15
Important Terms to Know................................. 17
KEY DEFINITIONS................................... 17
For More Information .................................. back cover
</TABLE>
More detailed information on all subjects covered in this simplified prospectus
is contained within the STATEMENT OF ADDITIONAL INFORMATION ("SAI"). Investors
seeking more in-depth explanations of the Fund should request the SAI and review
it before purchasing shares.
3
<PAGE>
OVERVIEW
OUR GOALS
The Fund is a money market fund that seeks to preserve your principal and
maintain a high degree of liquidity while providing current income. Also,
the Fund seeks to maintain a $1.00 per share net asset value. The goals
of the Fund can only be changed with shareholder approval.
HOW WE PLAN TO ACHIEVE OUR GOALS
OUR PRINCIPAL STRATEGIES -- We purchase liquid, high-quality, short-term
U.S. government and agency obligations. The securities must have a
maturity period of no more than 397 days and, in our opinion, present
minimal credit risk.
Using a top-down strategy and bottom-up security selection, we seek
securities with an acceptable maturity that are marketable and liquid and
offer competitive yields. We also consider factors such as the
anticipated level of interest rates and the maturity of individual
securities relative to the maturity of the Fund as a whole. The Fund
follows strict Investment Company Act rules about the credit quality,
maturity and diversification of its investments.
TYPES OF SECURITIES
The Fund invests exclusively in the following money market instruments
including:
- U.S. Treasury Obligations;
- Obligations issued or guaranteed as to principal and interest
by the agencies or instrumentalities of the U.S. Government;
and
- Repurchase agreements involving these obligations.
Please review the SAI for more detailed descriptions of these securities.
4
<PAGE>
CLASSES OF SHARES
This Prospectus offers Class S shares of the Fund. The Fund also offers
other classes of shares, which are subject to the same expenses, except
they may be subject to different distribution and/or shareholder
servicing costs.
PRINCIPAL RISKS OF INVESTING IN OUR FUND
As with any money market fund, there are risks to investing. We cannot
guarantee that we will meet our investment goals. Here are the principal
risks to consider:
MAINTAINING THE NET ASSET VALUE -- We cannot guarantee that the Fund will
be able to maintain a stable net asset value of $1.00 per share. You may
lose money by investing in the Fund.
NO FEDERAL GUARANTEES -- As with any money market mutual fund, an
investment in the Fund is not a deposit of a bank and is not insured,
guaranteed, or protected by the FDIC, Federal Reserve Board, or any
agency of the U.S. Government.
THE EFFECT OF INTEREST RATES -- A money market fund's yield is affected
by interest rate changes. When rates decline, the fund's yield will tend
to be somewhat higher than prevailing market rates. When rates rise, the
fund's yield may tend to be somewhat lower.
DEFENSIVE INVESTMENTS -- The securities in which the Fund invests, and
the strategies described in this Prospectus, are those that the Fund uses
under normal conditions. During unusual economic or market conditions, or
for temporary defensive or liquidity purposes, the Fund may invest up to
100% of its assets in cash or cash equivalents that would not ordinarily
be consistent with the Fund's goals.
YEAR 2000 -- Many computer systems cannot distinguish the year 2000 from
1900. This is known as the "Year 2000" problem. A computer system's
inability to tell the difference could cause problems with the handling
of securities
5
<PAGE>
trades, pricing and account services. Our software vendors and service
providers have assured us, but have not guaranteed, that their systems
will be adapted in time to avoid serious problems. We do not expect Year
2000 conversion costs to have much direct impact on the Fund because
these costs are borne primarily by the Fund's vendors and service
providers, and not directly by the Fund. It is also important to keep in
mind that the Year 2000 problem may negatively impact the government
securities in which the Fund invests and, by extension, the value of the
shares held by the Fund.
PAST PERFORMANCE
The Fund is a new series of the Trust and has recently commenced
operations. Therefore, no past performance information is available.
If you would like to know the Fund's current seven-day yield, call
1-888-889-0799.
6
<PAGE>
UNDERSTANDING EXPENSES
FEES AND EXPENSES OF THE FUND
This table describes the fees and expenses you may pay if you buy and
hold shares of the Fund. You pay no sales charges or transaction fees for
buying or selling shares of the Fund.
ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
<TABLE>
<S> <C> <C>
Management Fee* 0.26%
Distribution (12b-1) Fee 0.50%
Other Expenses
Shareholder Servicing Fee 0.25%
Other Fund Expenses** 0.14%
Total Other Expenses** 0.39%
---------
Total Annual Fund Operating Expenses*** 1.15%
</TABLE>
* The "Management Fee" is an annual fee, payable monthly out of the
Fund's net assets.
** Estimated.
*** The "Total Annual Fund Operating Expenses" is an estimate and may be
higher or lower than that outlined above. The investment manager has
voluntarily agreed to limit its fees or reimburse the Fund for expenses
to the extent necessary to keep Total Annual Fund Operating Expenses at
or below 1.05%. Any fee reductions or reimbursements may be repaid to the
investment manager within 3 years after they occur if such repayments can
be achieved within the Fund's then current expense limit, if any, for
that year and if certain other conditions are satisfied.
7
<PAGE>
EXAMPLE
The Example is intended to help you compare the cost of investing in the
Fund with the cost of investing in other money market funds. It 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. Your actual costs may be
higher or lower. The Example should not be considered a representation of
past or future expenses or performance.
Based on these assumptions your costs would be:
<TABLE>
<S> <C>
1 Year 3 Years
------ ---------
$117 $365
</TABLE>
8
<PAGE>
MANAGEMENT OF THE FUND
INVESTMENT MANAGER
City National Bank ("CNB") is the Fund's investment manager. As
investment manager, CNB provides the Fund with investment management
services, including the selection, appointment, and supervision of the
sub-adviser to the Fund. CNB receives 0.26% of average annual net assets
of the Fund for its investment management services.
CNB, founded in the early 1950's, is a federally chartered commercial
bank with approximately $6.3 billion in assets as of March 31, 1999. It
is a wholly-owned subsidiary of City National Corporation, a New York
Stock Exchange listed company. CNB's address is 400 North Roxbury Drive,
Beverly Hills, California 90210.
CNB is applying for an exemptive order from the Securities and Exchange
Commission which would permit it, subject to certain conditions required
by the SEC, to replace the current sub-adviser with a new sub-adviser
with the approval of the Board of Trustees but without obtaining
shareholder approval. Shareholders, however, will be notified of any
change of the sub-adviser and be provided with information regarding the
new sub-adviser. An order from the SEC granting this exemption benefits
shareholders by enabling the Fund to operate in a less costly and more
efficient manner.
SUB-ADVISER
Wellington Management Company, LLP ("Wellington Management") currently
serves as the Fund's sub-adviser pursuant to a sub-advisory agreement
between the investment manager and Wellington Management. Under the
sub-advisory agreement, Wellington Management provides investment
advisory and portfolio management services to the Fund. Wellington
Management is located at 75 State Street, Boston, Massachusetts 02109.
Wellington Management and its predecessor organizations have provided
investment advisory services to investment companies since 1928 and to
investment counseling clients since
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1960. As of March 31, 1999, Wellington Management had discretionary
management authority with respect to approximately $215 billion in
assets.
ADMINISTRATOR, FUND ACCOUNTANT AND TRANSFER AGENT
SEI Investments Mutual Funds Services serves as administrator and fund
accountant to the Fund. SEI Investments Fund Management serves as
transfer agent for the Fund. Both companies are located at One Freedom
Valley Drive, Oaks, Pennsylvania 19456 and can be reached at
1-888-889-0799.
DISTRIBUTOR
SEI Investments Distribution Co. (the "Distributor") serves as the Fund's
distributor pursuant to a distribution agreement with the Fund. The
Distributor is located at One Freedom Valley Drive, Oaks, Pennsylvania,
19456 and can be reached at 1-888-889-0799.
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ACCOUNT POLICIES
HOW WE PRICE SHARES -- Shares are priced at net asset value ("NAV") which
is expected to remain constant at $1.00. The NAV is calculated by adding
the values of all securities and other assets of the Fund, subtracting
the liabilities, and dividing the net amount by the number of outstanding
shares. Securities are valued at amortized cost, which approximates
market value.
WHEN SHARES ARE PRICED -- NAV calculations are made once each day,
usually by 4:30 p.m. Eastern time. Shares may be purchased on any day
that the New York Stock Exchange and the Federal Reserve are open for
business. Shares, however, cannot be purchased by Federal Reserve wire on
days when either the New York Stock Exchange or the Federal Reserve is
closed.
REPORTING FUND PERFORMANCE -- From time to time the Fund may advertise
its yield and effective yield. Performance figures are based upon
historical results and are not intended to indicate future performance.
If you have any questions about the Fund, please call the Fund at
1-888-889-0799.
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UNDERSTANDING EARNINGS AND TAXES
DECLARING AND PAYING DIVIDENDS -- Dividends are declared each day the NAV
is calculated. Dividends are normally paid on the last business day of
each month. Net capital gain, if any, will be paid once a year.
WHEN DO DIVIDENDS ACCRUE? -- Your dividends begin to accrue on the day of
purchase for shares bought before 4:30 p.m. Eastern time. They begin to
accrue on the following day for shares purchased after 4:30 p.m. Eastern
time. You will not be credited with dividends for shares on the day you
sell them.
DISTRIBUTION OPTIONS -- Your dividends will be automatically reinvested
in additional full or fractional shares, unless you instruct the Fund in
writing prior to the date of distribution of your election to receive
payment in cash. Your election will be effective for all dividends and
distributions paid after the Fund receives your written notice. To cancel
your election, please send the Fund another written notice. Proceeds from
distributions will normally be wired to your financial institution on the
business day after distributions are credited to your account.
TAX CONSIDERATIONS -- The Fund intends to distribute substantially all of
its net investment income (including net short-term capital gain) to
shareholders. If, at the close of each quarter of its taxable year, at
least 50% of the value of the Fund's total assets consists of obligations
the interest on which is excludable from gross income for federal income
tax purposes, the Fund may pay "exempt-interest dividends" to its
shareholders. Exempt-interest dividends are excludable from a
shareholder's gross income for federal income tax purposes, but may have
certain collateral federal tax consequences including alternative minimum
tax consequences.
You will be notified at least annually about the tax consequences of
distributions made each year. BE SURE TO CONSULT YOUR TAX ADVISOR ABOUT
THE
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SPECIFIC TAX IMPLICATIONS OF YOUR INVESTMENTS. FOR ADDITIONAL INFORMATION
REGARDING TAX CONSIDERATIONS, SEE THE SAI.
BACKUP WITHHOLDING -- You must provide to your financial institution with
your social security or tax identification number on your account
application form and specify whether or not you are subject to backup
withholding. Otherwise, you may be subject to backup withholding at a
rate of 31%.
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HOW TO BUY AND SELL SHARES
Here are the details you should know about buying and selling shares:
HOW TO PLACE AN ORDER
You may place an order with:
- an approved broker-dealer; or
- any other approved financial institution.
ORDERING THROUGH A BROKER-DEALER OR FINANCIAL INSTITUTION -- You may
purchase shares through accounts with brokers and other financial
institutions that are authorized to place trades in Fund shares for their
customers. If you invest through an authorized institution, you will have
to follow its procedures, which may be different from the procedures for
investing directly. Your financial institution may charge a fee for its
services, in addition to the fees charged by the Fund. You will also
generally have to address your correspondence or questions regarding the
Fund to your financial institution.
WHEN ORDERS WILL BE COMPLETED -- You may have to transmit purchase or
exchange requests to your financial institution at an earlier time for
your transaction to become effective that day. This allows the financial
institution time to process your request and transmit it to the Fund. For
more information about how to purchase or exchange fund shares through
your financial institution, you should contact your financial institution
directly.
If we receive your purchase order, through your financial institution,
before 4:30 p.m. Eastern time, the order will be executed that same day.
Orders received after 4:30 p.m. Eastern time will be executed the
following business day. Your shares will be bought only after we receive
a properly completed order with full payment.
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PURCHASE MINIMUMS -- You may buy shares for an initial amount of
$100,000. This is the required minimum account balance. You may buy
additional shares for $1,000 or more. However, in order to reach or
maintain these purchase and account balance minimums your broker-dealer
or financial institution may aggregate your purchase with the purchases
of its other clients. Further exceptions to the purchase minimum
requirement may be made at our discretion.
MINIMUM ACCOUNT BALANCES -- If your account balance drops below the
required minimum because of redemptions, the Fund may redeem your shares.
However, the Fund will always give you at least 30 days' written notice
to give you time to add to your account and avoid involuntary redemption
of your shares.
PAYMENT RESTRICTIONS -- We only accept payments by wire in U.S. funds.
Cash, checks and third-party checks will not be accepted. Consult with
your financial institution about their acceptable methods of payment.
WIRING FEE -- The financial institution placing your order may charge its
own wiring fees.
BUYING SHARES
FIRST TIME AND SUBSEQUENT PURCHASES -- You will have to follow your
financial institution's procedures for transacting with the Fund. Contact
your financial institution for more information.
SELLING SHARES
GENERAL INFORMATION -- You may sell your shares by contacting your
broker-dealer or financial institution. You will have to follow their
procedures. Contact your broker-dealer or financial institution for more
information.
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GENERAL RESTRICTIONS -- We may suspend the right to sell shares or
postpone payment for a sale of shares when either the New York Stock
Exchange or the Federal Reserve's Fedline System is closed or restricted.
We reserve the right to reject any order that is not received in proper
form. For example, if we are unable to determine how many shares you wish
to sell, we may not execute your order.
OTHER REDEMPTION OPTIONS -- Under conditions where cash redemptions are
detrimental to the Fund and its shareholders, we reserve the right to
make redemptions in readily marketable securities other than cash. In
unusual circumstances, the Fund may temporarily suspend the processing of
sell requests, or postpone payments of proceeds for up to five business
days, as permitted by federal securities laws. Please see the SAI for a
more detailed discussion.
CONFIRMING AUTHENTICITY -- We will take steps in an effort to verify that
an order is authentic. To do so, we may:
- ask for a form of personal identification or written
confirmation of instructions; and
- tape record your telephone instructions.
We reserve the right to refuse an order if we cannot reasonably confirm
the authenticity of the instructions.
LIABILITY -- We may be liable for losses from unauthorized or fraudulent
orders only if reasonable steps are not taken to verify an order's
authenticity.
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IMPORTANT TERMS TO KNOW
KEY DEFINITIONS
"We", "Us" and "Our" means the CNI Charter Government Fund.
"You" and "Your" means the prospective investor or current shareholder.
"Liquidity" means the ability to turn investments into cash.
"Quality" means the credit rating given to a security by a nationally
recognized statistical rating organization.
"Yield" means the interest rate you would receive if you kept your
investment in the Fund for a year. It is based on the current interest
rate for a trailing seven-day period.
"Effective Yield" means the interest rate, compounded weekly, you would
receive if you kept your investment in the Fund for a year.
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FOR MORE INFORMATION
CNI CHARTER GOVERNMENT FUND
Additional information is available free of charge in the STATEMENT OF
ADDITIONAL INFORMATION ("SAI"). The SAI is incorporated by reference (legally
considered part of this document). Additional information about the Fund's
investments is available in the Fund's Annual and Semi-Annual Reports to
shareholders. In the Fund's Annual Report, you will find a discussion of the
market conditions and investment strategies that significantly affected the
Fund's performance during its last fiscal year. To receive a free copy of this
Prospectus, the SAI, or the Annual or Semi-Annual Reports (when available),
please contact:
SEI Investments Distribution Co.
One Freedom Valley Drive
Oaks, Pennsylvania 19456
1-888-889-0799
INFORMATION ABOUT THE FUND MAY BE REVIEWED AND COPIED:
- - at the SEC's Public Reference Room in Washington, D.C. at 1-800-SEC-0330;
- - on the SEC's Internet site at www.sec.gov; or
- - by written request (including duplication fee) to the Public Reference
Section of the SEC, Washington, D.C. 20549-6009.
FOR THE CURRENT SEVEN-DAY YIELD, OR IF YOU HAVE QUESTIONS ABOUT THE FUND, PLEASE
CALL 1-888-889-0799.
The Fund's Investment Company Act
file number: 811-07923.
[LOGO]
GOVERNMENT FUND
CLASS S
PROSPECTUS
DATED MAY 1, 1999
CNI-F-007-01
