SANWA MUTUAL FUNDS GROUP, N-1A EL, 1997-07-31

SANWA MUTUAL FUNDS GROUP
N-1A EL, 1997-07-31

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<PAGE> 1

As filed with the Securities and Exchange Commission on July 30, 1997

File Nos. ______________ and _________________

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

-----------------

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]

and

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

------------------

SANWA FUND
----------
(Exact Name of Registrant as Specified in Charter)

3435 Stelzer Road, Columbus, Ohio 43219
---------------------------------------
(Address of Principal Business Office)

614-470-8000
------------
(Registrant's Telephone Number, including Area Code)

George O. Martinez
3435 Stelzer Road, Columbus, Ohio 43219
---------------------------------------
(Name and Address of Agent for Service)

Copies of communications to:

Martin E. Lybecker, Esq. Sanwa Funds
Ropes & Gray 3534 Stelzer Road
1301 K Street, N.W. Columbus, Ohio 43219
Suite 800 East
Washington, D.C. 20004

Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.

DECLARATION PURSUANT TO RULE 24F-2: Pursuant to Rule 24f-2 under the Investment
Company Act of 1940, the Registrant hereby elects to register an indefinite
number or amount of its shares of beneficial interest under the Securities Act
of 1933.

Registrant hereby amends the Registration Statement under the Securities Act of
1933 on such date or dates as may be necessary to delay its effective date until
Registrant shall file a further amendment that specifically states that such
Registration Statement shall become effective on such date as the Commission,
acting pursuant to Section 8(a), shall determine.

<PAGE> 2
CROSS REFERENCE SHEET
---------------------

PROSPECTUS FOR SANWA MUTUAL FUNDS GROUP
---------------------------------------

TRUST SHARES
------------

<TABLE>
<CAPTION>
Part A Item Prospectus Caption
- ----------- ------------------

<S> <C>
Cover Page.................................................... Cover Page

Synopsis...................................................... Prospectus Summary; Fee Table

Condensed Financial Information............................... Inapplicable

General Description
of Registrant.............................................. Prospectus Summary; Investment
Objective and Policies; General
Information - Description of the Group
and Its Shares

Management of Sanwa
Mutual Funds Group......................................... Management of Sanwa Mutual Funds
Group; General Information

Management's Discussion of
Fund Performance............................................ Inapplicable

Capital Stock and
Other Securities........................................... Sanwa Mutual Funds Group; How to
Purchase and Redeem Shares;
Dividends and Taxes; General
Information - Description of the Group
and Its Shares; General Information -
Miscellaneous
Purchase of Securities
Being Offered.............................................. Valuation of Shares; How to Purchase
and Redeem Shares

Redemption or Repurchase...................................... How to Purchase and Redeem Shares

Pending Legal Proceedings..................................... Inapplicable
</TABLE>

<PAGE> 3

MONEY MARKET FUNDS
------------------

Prime Money Market Fund
U.S. Treasury Obligations Fund

BOND FUND
---------

Investment Grade Bond Fund

BALANCED FUND
-------------

Global Asset Allocation Fund

STOCK FUND
----------

Equity Fund

TRUST SHARES
------------

SANWA BANK CALIFORNIA
INVESTMENT ADVISER

BISYS FUND SERVICES, INC.
ADMINISTRATOR AND DISTRIBUTOR

PROSPECTUS DATED [_______], 1997

<PAGE> 4
<TABLE>
TABLE OF CONTENTS
<CAPTION>
Page
----
<S> <C>
Prospectus Summary......................................................................................
Fee Table...............................................................................................
Investment Objective and Policies.......................................................................
Valuation of Shares.....................................................................................
How to Purchase and Redeem Shares.......................................................................
Dividends and Taxes.....................................................................................
Management of Sanwa Mutual Funds Group..................................................................
General Information.....................................................................................
</TABLE>

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING
MADE BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE GROUP
OR THE DISTRIBUTOR. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY THE GROUP
OR BY THE DISTRIBUTOR IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT
LAWFULLY BE MADE.

-i-

<PAGE> 5

SANWA MUTUAL FUNDS GROUP

3435 Stelzer Road For current yield, purchase,
Columbus, Ohio 43219 and redemption information,
Investment Adviser: Sanwa Bank California call (800) XXX-XXXX
TDD/TTY call (800) XXX-XXXX

THE SANWA MUTUAL FUNDS GROUP (the "Group") is an open-end management
investment company consisting of five separate investment funds (each a "Fund,"
and collectively, the "Funds"). Each Fund offers multiple classes of units of
beneficial interest ("Shares").

THE SANWA PRIME MONEY MARKET FUND (the "Prime Money Market Fund") seeks
as high a level of current income as is consistent with maintaining liquidity
and stability of principal.

THE SANWA U.S. TREASURY OBLIGATIONS FUND (the "U.S. Treasury
Obligations Fund"), seeks current income consistent with liquidity and stability
of principal. The Fund intends to invest exclusively in short-term obligations
issued or guaranteed by the U.S. Treasury and repurchase agreements fully
collateralized by U.S. Treasury securities.

AN INVESTMENT IN THE PRIME MONEY MARKET FUND OR THE U.S. TREASURY OBLIGATIONS
FUND (TOGETHER, THE "MONEY MARKET FUNDS") IS NEITHER INSURED NOR GUARANTEED BY
THE U.S. GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE MONEY MARKET FUNDS WILL
BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.

THE SANWA INVESTMENT GRADE BOND FUND (the "Investment Grade Bond Fund")
seeks a high level of income, consistent with preservation of capital.

THE SANWA GLOBAL ASSET ALLOCATION FUND (the "Global Asset Allocation
Fund") seeks a balance of income and long-term capital appreciation. The Fund
intends to invest in a mix of U.S. and international stocks, bonds, and cash
equivalents using a disciplined asset allocation approach.

THE SANWA EQUITY FUND (the "Equity Fund") seeks long-term capital
growth. The Fund intends to invest in the common stocks of corporations
representing a broad cross-section of the U.S. economy. The Fund expects to have
a level of risk commensurate with that represented by a broadly diversified
portfolio of U.S. common stocks, such as the Standard & Poor's 500 Index.

<PAGE> 6

This Prospectus relates to the Trust Shares of the Group, which are
offered to Sanwa Bank California and its affiliates and other financial service
providers approved by the Distributor for the investment of funds for which they
act in a fiduciary, advisory, agency, custodial (other than for individual
retirement accounts), or similar capacity. Through a separate prospectus, the
Group also offers Class A Shares, which are offered to the general public. A
Statement of Additional Information, dated ________, 1997 (as may be amended
from time to time), has been filed with the Securities and Exchange Commission
and is incorporated herein by reference. The Statement of Additional Information
and the prospectus relating to the Class A Shares are available without charge
by writing or by calling the Group at the address or telephone number shown
above.

This Prospectus sets forth concisely the information an investor should
know before investing and should be read carefully and retained for future
reference.

SHARES OF THE SANWA MUTUAL FUNDS GROUP ARE NOT DEPOSITS OR OBLIGATIONS
OF, OR ENDORSED OR GUARANTEED BY, SANWA BANK CALIFORNIA, ANY OF ITS AFFILIATES,
OR ANY OTHER BANK. SUCH SHARES ARE NOT FEDERALLY INSURED OR OTHERWISE PROTECTED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY
OTHER GOVERNMENTAL AGENCY. INVESTMENT IN THE FUNDS INVOLVES INVESTMENT RISKS
INCLUDING POSSIBLE LOSS OF PRINCIPAL.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION ("COMMISSION") OR ANY STATE SECURITIES COMMISSION, NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

The date of this Prospectus is [_________], 1997.

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<PAGE> 7

PROSPECTUS SUMMARY

The Group Sanwa Mutual Funds Group (the "Group"), a Massachusetts
business trust, is a diversified open-end management
investment company which currently consists of five
separately managed Funds. Each Fund offers to the public
two classes of Shares: Class A and Trust Class. This
prospectus relates to only the Trust Class Shares.

Investment Objective THE PRIME MONEY MARKET FUND seeks as high a level of
current income as is consistent with maintaining
liquidity and stability of principal.

THE U.S. TREASURY OBLIGATIONS FUND seeks current income
consistent with liquidity and stability of principal.

THE INVESTMENT GRADE BOND FUND seeks a high level of
income, consistent with preservation of capital.

THE GLOBAL ASSET ALLOCATION FUND seeks a balance of
income and long-term capital appreciation.

THE EQUITY FUND seeks long-term capital growth.

Investment Risks There can be no assurance that any Fund will achieve
its investment objective. Each Fund's net asset value or
performance may vary daily, reflecting fluctuations in
the market value of its portfolio holdings, interest
rate levels, and market conditions. The Prime Money
Market Fund, the Investment Grade Bond Fund, and the
Global Asset Allocation Fund may invest in foreign
securities which entails certain risks. See "Foreign
Securities."

Offering Price The public offering price of the Prime Money Market Fund
and the U.S. Treasury Obligations Fund is equal to the
net asset value per Trust Share, which each Fund will
seek to maintain at $1.00.

The public offering price of the Investment Grade Bond
Fund, the Global Asset Allocation Fund, and the Equity
Fund is equal to that Fund's net asset value per Trust
Share. See "HOW TO PURCHASE AND REDEEM SHARES--Purchases
of Trust Shares."

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<PAGE> 8

Minimum Purchase For Trust Shares there is a $100,000 minimum initial
investment with no minimum investment for subsequent
purchases. Employees of Sanwa Bank California may
purchase Trust Shares with a $500 minimum initial
investment, or a $50 minimum initial investment if
investing through the Group's Automatic Investment Plan.
See "HOW TO PURCHASE AND REDEEM SHARES--Auto Invest
Plan."

Investment Adviser Sanwa Bank California ("SBCL"), Los Angeles, California.

Dividends The Prime Money Market Fund, the U.S. Treasury
Obligations Fund, and the Investment Grade Bond Fund
declare dividends daily and pay such dividends monthly.
The Global Asset Allocation Fund declares and pays
dividends annually. The Equity Fund declares and pays
dividends monthly.

Distributor BISYS Fund Services, Inc., Columbus, Ohio.

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<PAGE> 9

FEE TABLE

The following tables are intended to assist investors in understanding
the expenses associated with investing in Trust Shares of the Funds.
<TABLE>
<CAPTION>
PRIME U.S. TREASURY INVESTMENT GLOBAL ASSET
MONEY MARKET OBLIGATIONS GRADE BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----
TRUST CLASS TRUST CLASS TRUST CLASS TRUST CLASS TRUST CLASS
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES(1)
Maximum Sales Load on Purchases 0% 0% 0% 0% 0%
Maximum Sales Load on
Reinvested Dividends 0% 0% 0% 0% 0%
Maximum Deferred Sales Load 0% 0% 0% 0% 0%
Redemption Fees(2) $ 0 $ 0 $ 0 $ 0 $ 0
Exchange Fee $ 0 $ 0 $ 0 $ 0 $ 0
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF NET ASSETS)(3)
Management Fees (after voluntary
fee reductions) 0.20% 0.10% 0.50% 0.80% 0.65%
12b-1 Fee 0.00% 0.00% 0.00% 0.00% 0.00%
Other Expenses(4) 0.38% 0.41% 0.39% 0.64% 0.40%
---- ---- ---- ---- ----
Total Fund Operating Expenses
(after voluntary fee reductions) 0.58% 0.51% 0.89% 1.44% 1.05%
==== ==== ==== ==== ====
</TABLE>

1 A Participating Organization (as defined in this Prospectus) may charge a
Customer's (as defined in the Prospectus) account fees for automatic
investments, exchanges, and other investment management services provided
in connection with investment in Trust Shares of a Fund. See "HOW TO
PURCHASE AND REDEEM SHARES--"Purchases of Trust Shares" and "HOW TO
PURCHASE AND REDEEM SHARES--Exchange Privilege."

2 A wire redemption charge (currently $7.00) may be deducted from the amount
of a wire redemption payment made at the request of a shareholder. See "HOW
TO PURCHASE AND REDEEM SHARES--Redemption by Telephone."

3 SBCL has agreed to voluntarily reduce the amount of its investment advisory
fee through the end of the Funds' initial fiscal year. Absent the voluntary
reduction of investment advisory fees, Management Fees and Total Operating
Expenses as a percentage of average daily net assets for Trust Shares would
be 0.30% and 0.68%, respectively, for the Prime Money Market Fund; 0.20%
and 0.61%, respectively, for the U.S. Treasury Obligations Fund; 0.60% and
0.99%, respectively, for the Investment Grade Bond Fund; 0.90% and 1.54%,
respectively, for the Global Asset Allocation Fund; and 0.75% and 1.15%,
respectively, for the Equity Fund. Lower total fund operating expenses will
result in higher yields.

4 "Other Expenses" are based on estimated amounts for the current fiscal
year.

EXAMPLE:

You would pay the following expenses on a $1,000 investment in Trust Shares of
the Funds, assuming (1) 5% annual return and (2) redemption at the end of each
time period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<S> <C> <C>
Prime Money Market Fund $6 $19
U.S. Treasury Obligations Fund $5 $16
Investment Grade Bond Fund $9 $28
Global Asset Allocation Fund $15 $46
Equity Fund $11 $33
</TABLE>

Trust Shares are not subject to a 12b-1 fee and are not sold pursuant
to a sales charge.

These tables are intended to assist investors in understanding the
various costs and expenses associated with investing in the Funds. See
"MANAGEMENT OF SANWA MUTUAL FUNDS GROUP" for a more complete discussion of
annual operating expenses of each Fund. THE EXAMPLE IS NOT CONSIDERED A
REPRESENTATION OF PAST OR FUTURE EXPENSES. THE FUNDS' ACTUAL EXPENSES MAY BE
GREATER OR LESS THAN THOSE SHOWN.

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<PAGE> 10

INVESTMENT OBJECTIVE AND POLICIES

MONEY MARKET FUNDS

Each Money Market Fund will endeavor to achieve its objective by
investing in a portfolio of high-quality money market instruments which complies
with the diversification and other requirements of Rule 2a-7 under the
Investment Company Act of 1940 (the "1940 Act"). All instruments in which the
Money Market Funds invest will be deemed to have maturities of 397 days or less.
The average dollar weighted maturity of each Money Market Fund's portfolio will
not exceed 90 days. See "VALUATION OF SHARES" and the Statement of Additional
Information for a further explanation of the amortized cost valuation method.

All securities acquired by the Money Market Funds will be determined at
the time of purchase, under guidelines established by the Group's Board of
Trustees, to present minimal credit risks. Under the guidelines adopted by the
Board of Trustees and in accordance with Rule 2a-7 under the 1940 Act, SBCL may
be required to dispose of an obligation held in a Fund's portfolio if there is
an indication that the instrument's credit quality has diminished, such as where
a nationally recognized statistical ratings organization ("NRSRO") downgrades an
obligation to below the second highest rating category or in the event of a
default relating to the financial condition of the issuer.

PRIME MONEY MARKET FUND

The investment objective of the Prime Money Market Fund is to seek as
high a level of current income as is consistent with maintaining liquidity and
stability of principal. The Fund will invest in certificates of deposit,
bankers' acceptances, commercial paper, repurchase agreements, reverse
repurchase agreements, other money market securities, short-term corporate,
state, and municipal obligations that are rated in the top two tiers by an NRSRO
or, if unrated, are of comparable quality. The Fund also invests in securities
whose interest and principal payments are backed by the full faith and credit of
the U.S. government or by an agency of the U.S. government (certain agency
securities are not backed by the full faith and credit of the U.S. government).

U.S. TREASURY OBLIGATIONS FUND

The investment objective of the U.S. Treasury Obligations Fund is to
seek current income consistent with liquidity and stability of principal. Under
normal market conditions, the Fund will invest exclusively in short-term
obligations issued or guaranteed by the U.S. Treasury and repurchase agreements
fully collateralized by U.S. Treasury securities.

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<PAGE> 11

INVESTMENT GRADE BOND FUND

The Investment Grade Bond Fund seeks a high level of income, consistent
with preservation of capital. To achieve this objective, the Fund intends to
invest in a broad range of fixed income securities, including U.S. Treasury
securities (bonds, notes, and bills), U.S. agency securities, mortgage related
securities, corporate securities, preferred stocks, depository institution
obligations, and repurchase agreements. Under normal market conditions, the Fund
will invest at least 80% of its net assets in investment grade securities, as
determined by NRSRO ratings, or if unrated, as determined by SBCL to be of
comparable quality.

The Fund will invest in a varying combination of cash, U.S. Treasury
securities, U.S. agency securities, mortgage related securities, and corporate
securities which are all issued in U.S. dollars. In pursuing its investment
objective, the Fund expects that its portfolio will be characterized by
investment risk that is similar to that of a theoretical broadly diversified
domestic investment grade bond portfolio, such as a portfolio structured to
match the Salomon Broad Investment Grade Index or the Lehman Aggregate Index.

SBCL uses its proprietary, quantitative fixed income security selection
strategy to determine the optimal combination of investments in the portfolio.
SBCL will use a variety of quantitative investment models and risk management
systems to identify the optimal interest rate, credit, and convexity exposure at
any point in time. SBCL seeks the fixed income sectors and/or securities with
high expected relative return premiums, adjusted for risk. Fundamental
valuation, macroeconomic, technical and risk measures are all employed to
determine the expected relative return premium for each sector and/or security.
Once the attractiveness of the various investment sector and individual security
alternatives is determined, the portfolio is constructed so as to overweight
those sectors and/or securities with the most-favorable prospects, according to
the current quantitative analysis.

In order to execute its strategy in an efficient manner, SBCL may
utilize bond index futures contracts in representing various yield curve
sectors. The Fund will use futures contracts to provide an efficient means of
achieving exposure to the fixed income markets. Futures contracts may be used to
provide liquidity, gain broad market exposure, and hedge unwanted interest rate
exposure. SBCL will not use futures to leverage the Fund's holdings.

The Fund may invest up to 20% of its net assets in non-investment grade
debt securities, preferred stocks and convertible securities. In the event that
a security held by the Fund is downgraded, the Fund may continue to hold such
security until such time as SBCL deems it to be advantageous to dispose of the
security.

The Fund may hold securities of foreign issuers, provided such
securities are denominated in U.S. dollars. The Fund may also invest in bond
(interest rate)

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<PAGE> 12

options to a limited extent. See "Investment Objective and Policies--Specific
Investment Policies."

GLOBAL ASSET ALLOCATION FUND

The investment objective of the Global Asset Allocation Fund is to seek
a balance of income and long-term capital appreciation. Through the use of a
disciplined asset allocation approach, the Fund intends to invest in, and assume
a level of risk commensurate with, a globally diversified portfolio of stocks,
bonds, and cash equivalents. By systematically diversifying across countries,
currencies, and asset classes (stocks and bonds), the Fund pursues its capital
appreciation goals while seeking to control portfolio risk.

The Fund will invest in a varying combination of stocks, bonds, and
cash equivalents selected primarily from major markets such as: the United
States, Japan, the U.K., Germany, France, Switzerland, Spain, Canada and
Australia. The Fund may also invest in other markets, including emerging
markets.

Under normal circumstances, at least 65% of the Fund's net assets will
be invested in securities representing at least three different countries,
including the United States.

SBCL uses its proprietary, quantitative global tactical asset
allocation, global currency allocation, and global sector rotation strategies to
determine the optimal combination of investments in the portfolio. SBCL will use
a variety of quantitative investment models to identify the country, sector, and
asset classes deemed most attractive. SBCL seeks those sectors, asset classes,
countries, and currencies with a high expected relative return premium, adjusted
for risk. Fundamental valuation, macroeconomic, technical, and risk measures are
all employed to determine the expected relative return premium for each country,
currency, asset class, and sector. Once the relative attractiveness of the
various investment class alternatives is determined, the portfolio is
constructed so as to overweight those countries, currencies, sectors, and asset
classes with the most favorable prospects, according to the current quantitative
analysis.

In evaluating equity exposure, SBCL attempts to assess the relative
value of each country's market in the aggregate. SBCL may overweight the Fund's
investments in a few selected countries and/or asset classes. The Fund typically
will not deviate by more than 20% from the market capitalization weights of the
respective individual equity markets.

Investments will also include direct investments in short-term or
long-term government bonds, and U.S. and foreign cash equivalents. Bonds in the
Fund's portfolio are expected to range in maturity from one to thirty years.

In order to execute its strategy in an efficient manner, SBCL may
utilize equity index, bond index, and currency futures contracts in the various
countries. The Fund will use futures

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<PAGE> 13

contracts to provide an efficient means of achieving broad market exposure to
the stock, fixed income and currency markets of a particular country, to provide
liquidity, and to facilitate asset allocation shifts. Currency futures provide
an efficient vehicle for hedging foreign exchange exposure. By investing in a
stock index futures contract the Fund is exposed to an index of stocks without
buying each underlying security in that index. See "Options and Futures" in the
Statement of Additional Information for a more detailed discussion of the risks
associated with investment in futures contracts.

EQUITY FUND

The Equity Fund's investment objective is to seek long-term capital
growth. The Fund intends to invest in the common stocks of corporations from a
broad cross section of the U.S. economy. The Fund expects to assume a level of
risk commensurate with that represented by a broadly diversified portfolio of
U.S. common stocks, such as that measured by the S&P 500 Index. Under normal
market conditions, the Fund will invest at least 65% of its net assets in common
stocks.

Equity investments are chosen based upon SBCL's proprietary,
quantitatively-disciplined stock selection models. A combination of valuation,
growth, technical, and risk measures are used to rank a universe of
approximately 1,000 U.S. equity issues. The issues assigned the most attractive
overall composite ratings are those which are deemed to have greater potential
for price appreciation over a short-to-intermediate term horizon. The portfolio
is then constructed so that the aggregate investment characteristics of the Fund
are similar to those of the S&P 500 Index. These characteristics include such
measures as economic sector diversification, P/E ratio, dividend yield, and
market "beta" (or sensitivity). However, while maintaining aggregate investment
characteristics similar to those of the S&P 500 Index, the Fund seeks to invest
in individual common stocks -- including stocks which may not be part of that
Index -- which SBCL believes hold a greater potential for price appreciation.
There can be no assurance that the Fund's investment performance will meet or
exceed that of the S&P 500 Index.

Although the Fund normally intends to be fully invested in common
stocks, it may invest temporarily in certain short-term fixed income securities.
Such securities may be used to invest uncommitted cash balances or to maintain
liquidity in order to meet shareholder redemptions.

The Fund may also utilize equity index futures for the dual purpose of
providing an adequate level of liquidity to the Fund and ensuring that cash
balances achieve equity-like returns. This "equitization" of short-term cash
balances will assist the Fund to meet its investment objective. By investing in
a stock index futures contract the Fund is exposed to an index of stocks without
buying each underlying security in that index. Under no circumstances will the
market exposure of futures contracts exceed 30% of the Fund's net assets. SBCL
will not use futures to leverage the Fund's holdings. See "Options

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<PAGE> 14

and Futures" in the Statement of Additional Information for a more detailed
discussion of the risks associated with investments in futures contracts.

ALL FUNDS

The investment objective of each Fund is fundamental and may not be
changed without the vote of a majority of the outstanding Shares of the Fund (as
defined below under "GENERAL INFORMATION--Miscellaneous"). There can be no
assurance that a Fund will achieve its investment objective.

SPECIFIC INVESTMENT POLICIES

The Funds invest in a variety of securities and employ a number of
investment practices. Each security and investment practice involves certain
risks. This table shows the securities and investment practices utilized by the
Funds and the risks inherent in their use. For a more complete discussion of
each instrument and its attendant risks, consult the Funds' Statement of
Additional Information.

# Percent of total assets under normal market conditions
x/ No policy limitation on usage
- Not permitted
+ For temporary defensive purposes may constitute 100 percent
of total assets

<TABLE>
<CAPTION>
PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----
INVESTMENT PRACTICES
- --------------------
AND SECURITIES
- --------------
<S> <C> <C> <C> <C> <C>
ASSET BACKED SECURITIES. Securities secured by x/ __ x/ 35 35
company receivables, home equity loans, truck and auto
loans, leases, credit card receivables and other securities
backed by receivables or assets. Credit, interest rate,
opportunity and pre-payment risks.

BANKERS' ACCEPTANCES. Bills of exchange or time 25 __ 35+ 35+ 35+
drafts drawn on and accepted by a commercial bank.
Credit risk.

BORROWINGS.(1) The borrowing of money from banks or 33 1/3 33 1/3 33 1/3 33 1/3 33 1/3
through reverse repurchase agreements. Leverage and
credit risks.

CERTIFICATES OF DEPOSIT. Negotiable instruments with a x/ __ 35+ 35+ 35+
stated maturity. Credit and liquidity risks.
</TABLE>

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<PAGE> 15
<TABLE>
<CAPTION>
PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
COMMERCIAL PAPER AND OTHER SHORT-TERM x/ __ 35+ 35+ 35+
OBLIGATIONS. Short-term promissory notes or other
obligations issued by corporations and other entities.
Credit risk.

COMMON STOCK. Shares of ownership of a company. __ __ __ x/ x/
Market risk.

CONVERTIBLE SECURITIES. Bonds or preferred stock that __ __ x/ x/ x/
convert to common stock. Credit, interest rate and
market risks.

CORPORATE OR COMMERCIAL BONDS. Debt securities issued by x/ __ x/ x/ 35
corporations. Credit and interest rate risks.

EMERGING MARKET SECURITIES. Securities of countries __ __ __ 15 __
with emerging economies or securities markets.
Currency, information, liquidity, market and political risks.

FOREIGN SECURITIES.

o Stocks and bonds of foreign issuers __ __ 35 x/ 35
o American depository receipts, European x/ __ __ x/ 35
depository receipts, global depository receipts
and other similar global instruments

Currency, liquidity, information, market, natural event
and political risks.

FORWARD COMMITMENTS. The purchase or sale of a x/ x/ x/ x/ x/
security with payment and delivery scheduled for a
future time. Leverage, market and opportunity risks.

FORWARD FOREIGN CURRENCY EXCHANGE TRANSACTIONS. __ __ __ 50 __
Contractual agreement to purchase or sell one specified
currency for another currency at a specified future date
and price. Credit, correlation, currency, information,
leverage, liquidity, management, market, opportunity
and political risks.

ILLIQUID SECURITIES.(3) Securities which may be difficult 10 __ 15 15 15
to sell at an acceptable price. Liquidity, market and
valuation risks.
</TABLE>

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<PAGE> 16
<TABLE>
<CAPTION>
PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
INVESTMENT COMPANY SECURITIES. Shares of other
mutual funds. SBCL and BISYS Fund Services, Inc.
will reduce certain fees when investing in funds for
which it serves as investment and adviser or
administrator. (Investments in any one fund will not
exceed 5% of total assets. Investments in all funds will
not exceed 10% of total assets.)

o Money market mutual funds 10 10 10 10 10
o Non-money market mutual funds __ __ __ 10 __

Management and market risks.

MORTGAGE BACKED SECURITIES.(2) Debt obligations __ __ x/ 35 35
secured by real estate loans and pools of loans,
including such securities as collateralized mortgage
obligations, which are structured pools of mortgage pass
through certificates or mortgage loans, real estate
investment conduits, and stripped mortgage backed
securities. Mortgage backed securities may have
greater price and yield volatility than traditional fixed-
income securities and their prepayment sensitivity may
range from relatively low to relatively high. Credit,
interest rate, opportunity and pre-payment risks.

MORTGAGE DOLLAR ROLLS. A transaction in which a fund __ __ x/ x/ x/
sells securities for delivery in a current month and
simultaneously contracts with the same party to
repurchase similar but not identical securities on a
specified future date. Interest rate, management and
market risks.

MUNICIPAL OBLIGATIONS. Securities issued by a state or x/ __ x/ __ __
political subdivision to obtain funds for various public
purposes. Municipal obligations include participation
certificates in leases, installment purchase contracts and
conditional sales contracts. Credit, liquidity, political
and tax risks.

OPTIONS AND FUTURES.(1) Contracts involving the right or __ __ x/ x/ x/
obligation to deliver or receive assets or money
depending upon the performance of one or more assets
or an economic index. Currency, correlation, credit,
interest rate, leverage, liquidity, opportunity and market
risks.
</TABLE>

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<PAGE> 17
<TABLE>
<CAPTION>
PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
PREFERRED STOCK. A class of stock that generally pays a __ __ 30 x/ x/
dividend at a specified rate and has preference over
common stock in the payment of dividends and
liquidation. Market risk.

REPURCHASE AGREEMENTS.(1) The purchase of a security x/ x/ x/ x/ x/
and the simultaneous commitment to sell it back at an
agreed upon price. Credit, market and leverage risks.

REVERSE REPURCHASE AGREEMENTS.(1, 4) The sale of a x/ x/ x/ x/ x/
security and the simultaneous commitment to buy it
back at an agreed upon price. Credit, leverage and
market risks.

RESTRICTED SECURITIES.(5) Securities not registered under 10 __ x/ x/ x/
the Securities Act of 1933. Market and valuation risks.

RIGHTS AND WARRANTS. A contract issued by a corporation __ __ x/ x/ x/
enabling the owner to subscribe to and purchase a specified
number of shares of the corporation at a specified price
during a specified period of time. Market and valuation risks.

SECURITIES LENDING.(1) The lending of securities to 33 1/3 33 1/3 33 1/3 33 1/3 33 1/3
financial institutions, which provide cash or government
securities as collateral. Credit risk.

SHORT-TERM TRADING. The sale of a security soon after __ __ x/ x/ x/
its purchase. A portfolio engaging in such trading will
have higher turnover and transaction expenses. Market
risk.

SWAPS, CAPS AND FLOORS.(5) Swaps involve the exchange __ __ x/ x/ x/
of obligations by two parties. Caps and floors entitle a
purchaser to a principal amount from the seller of the cap
or floor to the extent that a specified index exceeds or falls
below a predetermined interest rate or amount. Correlation,
credit, interest rate, liquidity, management,market and
opportunity risks.

TIME DEPOSITS. Non-negotiable receipts issued by a x/ __ 35+ 35+ 35+
bank in exchange for the deposit of funds. Liquidity
risk.

U.S. GOVERNMENT SECURITIES. Short-term debt x/ x/ x/ x/ 35+
instruments issued or guaranteed by the U.S. Treasury
or by an agency or instrumentalities of the U.S.
government. Credit risk.

</TABLE>

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<PAGE> 18
<TABLE>
<CAPTION>
PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
VARIABLE AND FLOATING RATE INSTRUMENTS. Obligations x/ x/ x/ x/ __
with a yield that is reset on a periodic basis and loosely
correlated to changes in money market interest rates,
including variable and floating rate notes and bonds.
Credit, interest rate and liquidity risks.

WHEN-ISSUED OR DELAYED-DELIVERY SECURITIES. The x/ x/ x/ x/ x/
purchase or sale of securities for delivery at a future
date. Leverage, market and opportunity risks.
</TABLE>

1 Each Fund has a fundamental investment policy regarding these practices
or securities, as set forth in the Statement of Additional Information, which
may in some cases be less restrictive than the operating policy set forth in the
chart.

2 The Money Market Funds may invest in these securities only if consistent
with their objectives and Rule 2a-7.

3 Each Fund's liquidity limit is calculated as a percentage of its net
assets.

4 Reverse repurchase agreements would also be subject to a Fund's policy on
borrowings.

5 Relative to other securities, these securities are more likely to be
deemed illiquid and, therefore, may be subject to the restrictions on illiquid
securities.

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<PAGE> 19

TYPES OF INVESTMENT RISK

CORRELATION RISK. The risk that changes in the value of a hedging instrument
will not match those of the asset being hedged (hedging is the use of one
investment to offset the effects of another investment). Incomplete correlation
can result in unanticipated risks and volatility.

CREDIT RISK. The risk that the issuer of a security, or the counterparty to a
contract, will default or otherwise become unable to honor a financial
obligation.

CURRENCY RISK. The risk that fluctuations in the exchange rates between the U.S.
dollar and foreign currencies may negatively affect an investment. Adverse
changes in exchange rates may erode or reverse any gains produced by foreign
currency denominated investments and may widen any losses.

INFORMATION RISK. The risk that key information about a security or market is
inaccurate or unavailable.

INTEREST RATE RISK. The risk of market losses attributable to changes in
interest rates. With fixed-rate securities, a rise in interest rates typically
causes a fall in values, while a fall in rates typically causes a rise in
values.

LEVERAGE RISK. Associated with securities or practices (such as borrowing) that
multiply small index or market movements into large changes in value.

o HEDGED. When a derivative (a security whose value is based on
another security or index) is used as a hedge against an opposite
position that the fund also holds, any loss generated by the
derivative should be substantially offset by gains on the hedged
investment, and vice versa. While hedging can reduce or eliminate
losses, it can also reduce or eliminate gains. There can be no
assurance that a Fund's hedging transactions will be effective.

o SPECULATIVE. To the extent that a derivative is not used as a
hedge, the fund is directly exposed to the risks of that
derivative. Gains or losses from speculative positions in a
derivative may be substantially greater than the derivative's
original cost.

LIQUIDITY RISK. The risk that certain securities may be difficult or impossible
to sell at the time and the price that the seller would like. The seller may
have to lower the price, sell other securities instead or forego an investment
opportunity, any of which could have a negative effect on fund management or
performance.

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<PAGE> 20

MANAGEMENT RISK. The risk that a strategy used by a fund's management may fail
to produce the intended result. This risk is common to all mutual funds.

MARKET RISK. The risk that the market value of a security may move up and down,
sometimes rapidly and unpredictably. These fluctuations may cause a security to
be worth less than the price originally paid for it, or less than it was worth
at an earlier time. Market risk may affect a single issuer, industry, sector of
the economy or the market as a whole. Common to all stocks and bonds and the
mutual funds that invest in them.

NATURAL EVENT RISK. The risk of losses attributable to natural disasters, crop
failures and similar events.

OPPORTUNITY RISK. The risk of foregoing an investment opportunity because the
assets necessary to take advantage of it are tied up in less advantageous
investments.

POLITICAL RISK. The risk of losses attributable to government or political
actions, from changes in tax or trade statutes to governmental collapse and war.
There are also risks particular to investing in foreign securities, including
higher transaction costs, delayed settlements, currency controls and adverse
economic developments.

PRE-PAYMENT RISK. Early repayment of principal and interest will effect the rate
of return on mortgage-backed securities and may result in greater price and
yield volatility and possible investment losses. When mortgage obligations are
pre-paid, a Fund may have to reinvest in securities with a lower yield. During
periods of declining interest rates, prepayment rates can be expected to
accelerate. Under certain interest rate and prepayment rate scenarios, a Fund
may fail to recoup any premium paid on mortgage-related securities
notwithstanding a direct or indirect governmental or agency guarantee.

TAX RISK. The risk that the issuer of tax-exempt securities will fail to comply
with certain requirements of the Internal Revenue Code, which could cause
interest income to be retroactively included in gross income.

VALUATION RISK. The risk that a fund has valued certain of its securities at a
higher price than it can sell them for.

PORTFOLIO TURNOVER

It is presently anticipated that the portfolio turnover rate of the
Investment Grade Bond Fund, the Global Asset Allocation Fund, and the Equity
Fund will not exceed 100%, 200%, and 200%, respectively. High portfolio turnover
rates will generally result in higher transaction costs to a Fund and may result
in higher levels of taxable realized gains to a Fund's shareholders.

-16-

<PAGE> 21

INVESTMENT RESTRICTIONS

The Funds are subject to a number of investment restrictions that may
be changed only by a vote of a majority of the outstanding shares of the
particular Fund ("fundamental policies"). These fundamental policies (including
those noted by Footnote 1 in the chart above) are set forth in their entirety in
the Funds' Statement of Additional Information.

VALUATION OF SHARES

The net asset value of each Fund is determined and its Shares are
priced as of the close of regular trading of the New York Stock Exchange
(generally 4:00 p.m. Eastern time) on each Business Day ("Valuation Times"). For
each Money Market Fund, a "Business Day" constitutes (i) any day on which the
Federal Reserve Bank is open and the New York Stock Exchange (the "NYSE") is
open for trading and (ii) any other day (other than a day during which no Shares
are tendered for redemption and no orders to purchase Shares are received)
during which there is sufficient trading in a Fund's portfolio instruments that
the Fund's net asset value per share might be materially affected. For each
Fund, other than the Money Market Funds, a Business Day is (i) any day on which
the NYSE is open for trading and (ii) any other day (other than a day during
which no Shares are tendered for redemption and no orders to purchase Shares are
received) during which there is sufficient trading in a Fund's portfolio
instruments that the Fund's net asset value per share might be materially
affected. Net asset value per Share for purposes of pricing sales and
redemptions is calculated by determining the value of the class's proportional
interest in the securities and other assets of a Fund, less (i) such class's
proportional share of general liabilities and (ii) the liabilities allocable
only to such class, and dividing such amount by the number of relevant class
Shares outstanding.

The securities in each Fund, other than the Money Market Funds, will be
valued at market value. If market quotations are not available, the securities
will be valued by a method which the Board of Trustees of the Group believes
accurately reflects fair value.

The Money Market Funds use the amortized cost method of valuing their
securities. This method values a security at its cost on the date of purchase
and thereafter assumes a constant amortization to maturity of any discount or
premium, regardless of the impact fluctuating interest rates have on the market
value of the security. If the Board of Trustees determines that the deviation
from a $1.00 price per share may result in material dilution or other unfair
results to Shareholders, it will take appropriate steps to eliminate or reduce
these consequences to the extent reasonably practicable. Such steps may include
selling portfolio securities prior to maturity in order to realize capital gains
or losses or to shorten the average portfolio maturity of a Fund, adjusting or
withholding dividends, or utilizing a net asset value per share determined by
using available market quotations. There can be no assurance that a Money Market
Fund will maintain a stable net asset value of $1.00 per Share.

-17-

<PAGE> 22

Most international securities held by the Global Asset Allocation Fund
are priced based on their market value as determined by reported sales prices or
the mean between their bid and asked prices. Portfolio securities which are
primarily traded on foreign securities exchanges are generally valued at the
preceding closing values of such securities on their respective exchanges,
except when an occurrence subsequent to the time a value was so established is
likely to have changed such value. Securities for which market quotations are
not readily available are valued at fair market value as determined in good
faith by or under the direction of the Board of Trustees. The amortized cost
method of valuation will also be used with respect to debt obligations with
sixty days or less remaining to maturity unless SBCL under the supervision of
the Board of Trustees determines such method does not represent fair value.

For further information about the valuation of investments, see the
Statement of Additional Information.

HOW TO PURCHASE AND REDEEM SHARES

DISTRIBUTOR

Shares are sold on a continuous basis by the Group's Distributor, BISYS
Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio 43219.

PURCHASES OF TRUST SHARES

Trust Shares may be purchased through procedures established by the
Distributor in connection with the requirements of fiduciary, advisory, agency,
custodial and other similar accounts maintained by or on behalf of Customers of
SBCL or one of its affiliates (individually a "Bank" and collectively the
"Banks") or other financial service providers approved by the Distributor.

Shares of the Group sold to the Banks acting in a fiduciary, advisory,
custodial (other than for individual retirement accounts), or other similar
capacity on behalf of Customers will normally be held of record by the Banks.
With respect to Shares so sold, it is the responsibility of the Banks to
transmit purchase or redemption orders to the Distributor and to deliver Federal
funds for purchase on a timely basis. Beneficial ownership of the Shares will be
recorded by the Banks and reflected in the account statements provided by the
Banks to Customers.

Trust Shares are sold at the net asset value purchase next determined
after receipt by the Distributor of a purchase order in good form. See
"VALUATION OF SHARES." There is no sales charge imposed by the Group in
connection with the purchase of the Group's Trust Shares.

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<PAGE> 23

The minimum initial investment is $100,000, except for purchases by
employees of SBCL, in which case the minimum initial investment is $500, or $50
if part of the Group's automatic investment plan, as described below. There is
no minimum subsequent investment requirement. There is no limit on the amount of
Trust Shares that may be purchased.

ADDITIONAL INFORMATION ABOUT PURCHASING SHARES

Purchases of Trust Shares of the Funds will be effected only on a
Business Day (as defined in "VALUATION OF SHARES"). An order for a Fund received
prior to the Valuation Time on any Business Day will be executed at the net
asset value determined as of the next Valuation Time on the date of receipt. An
order received after the last Valuation Time on any Business Day will be
executed at the net asset value determined as of the next Valuation Time.

An order to purchase Trust Shares of a Money Market Fund will be deemed
to have been received by the Distributor when federal funds are available to the
Group's custodian for investment. Federal funds are monies credited to a bank's
account within a Federal Reserve Bank. Payment for an order to purchase Shares
of a Money Market Fund which is transmitted by federal funds wire will be
available the same day for investment by the Group's custodian, if received
prior to the last Valuation Time (see "VALUATION OF SHARES"). It is strongly
recommended that investors of substantial amounts use federal funds to purchase
Shares of a Money Market Fund.

Shares of a Money Market Fund purchased before 4:00 p.m., Eastern time,
begin earning dividends on the same Business Day. All Shares of a Money Market
Fund continue to earn dividends through the day before their redemption.

Depending upon the terms of a particular Customer account, a
Participating Organization or Bank may charge a Customer's account fees for
services provided in connection with investment in the Group. Information
concerning this Prospectus should be read in conjunction with any such
information received from the Participating Organizations or Banks.

The Group reserves the right to reject any order for the purchase of
its Trust Shares in whole or in part, including purchases made with foreign
drafts or checks. The Group will not accept third party checks for investment.

Please contact SBCL or your Participating Organization regarding proper
instructions and information to purchase or redeem Shares by check or wire.
Shareholders may also execute telephone transactions as explained below.

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<PAGE> 24

AUTO INVEST PLAN

Sanwa Mutual Funds Group's Auto Invest Plan enables those Shareholders
who are employees of SBCL to make regular purchases of Trust Shares through an
automatic deduction from their bank accounts. With Shareholder authorization,
the BISYS Fund Services, Inc.(the "Transfer Agent") will deduct the amount
specified (subject to the applicable minimums) from the Shareholder's bank
account and will automatically invest that amount in Trust Shares at the public
offering price on the date of such deduction. The required minimum initial
investment when opening an account using the Auto Invest Plan is $50 per Fund;
the minimum amount for subsequent investments in a Fund is $50. To participate
in the Auto Invest Plan, Shareholders should complete the appropriate section of
the Account Registration Form or submit a subsequent written request to the
Transfer Agent. To change the Auto Invest Plan instructions or to discontinue
the feature, a Shareholder request must be made in writing to the Sanwa Mutual
Funds Group, P.O. Box XXXXXX, Columbus, Ohio XXXXX-XXXX. The Auto Invest Plan
may be amended or terminated without notice at any time by the Distributor.

EXCHANGE PRIVILEGE

Trust Shares of each Fund may be exchanged for Trust Shares of the
other Funds, provided that the Shareholder making the exchange is eligible on
the date of the exchange to purchase Trust Shares (with certain exceptions and
subject to the terms and conditions described in this prospectus). Trust Shares
of each Fund may be exchanged for Class A Shares in instances where the
Shareholder ceases to be eligible to purchase Trust Shares.

The Group does not impose a fee for processing exchanges of its Trust
Shares. Shareholders may exchange their Trust Shares for Trust Shares of another
Fund on the basis of the relative net asset value of the Shares exchanged.

An exchange is considered a sale of Shares and will result in a capital
gain or loss for federal income tax purposes, which, in general, is calculated
by netting the Shareholder's tax cost (or "basis") in the Shares surrendered and
the value of the Shares received in the exchange.

A Shareholder wishing to exchange Trust Shares purchased through a
Participating Organization or Bank may do so by contacting the Participating
Organization or Bank. If an exchange request in good order is received by the
Distributor or the Transfer Agent by 4:00 p.m. (Eastern time) on any Business
Day, the exchange usually will occur on that day. Any Shareholder who wishes to
make an exchange should obtain and review a prospectus describing the Fund and
class of Shares which he or she wishes to acquire before making the exchange.
The exchange privilege may be exercised only in those states where the class of
Shares of such other Fund may legally be sold. The Group reserves the right to
change the terms and conditions of the exchange privilege discussed herein upon
sixty days written notice.

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<PAGE> 25

The Funds are not intended to serve as vehicles for frequent trading in
response to short-term fluctuations in the market. Due to the disruptive effect
that excessive trading can have on efficient portfolio management, the Funds
have established a policy of limiting exchange activity to four substantive
exchange redemptions from a Fund during any calendar year. There is a $500
minimum for all exchanges.

AUTO EXCHANGE

Sanwa Mutual Funds Group Auto Exchange enables Shareholders, who are
employees of Sanwa Bank California, to make regular, automatic withdrawals from
Trust Shares of a Money Market Fund and use those proceeds to benefit from
dollar-cost-averaging by automatically making purchases of shares of another
Sanwa Mutual Fund. With shareholder authorization, the Transfer Agent will
withdraw the amount specified (subject to the applicable minimums) from the
Shareholder's Money Market Fund account and will automatically invest that
amount in Trust Shares of the Fund designated by the Shareholder. In order to
participate in the Auto Exchange, Shareholders must have a minimum initial
purchase of $[10,000] in their Money Market Fund account and maintain a minimum
account balance of $1,000.

To participate in the Auto Exchange, Shareholders should complete the
appropriate section of the Account Registration Form, which can be acquired by
calling the Distributor. To change the Auto Exchange instructions or to
discontinue the feature, a Shareholder must send a written request to the Sanwa
Mutual Funds Group, P.O. Box XXXXX, Columbus, Ohio XXXXX-XXXX. The Auto Exchange
may be amended or terminated without notice at any time by the Distributor.

REDEMPTION OF SHARES

Shareholders may redeem their Trust Shares without charge on any day
that net asset value is calculated (see "VALUATION OF SHARES") and Shares may
ordinarily be redeemed by mail or by telephone. However, all or part of a
Customer's Shares may be required to be redeemed in accordance with instructions
and limitations pertaining to his or her account held by a Participating
Organization or Bank. For example, if a Customer has agreed to maintain a
minimum balance in his or her account, and the balance in that account falls
below that minimum, the Customer may be obliged to redeem, or the Participating
Organization or Bank may redeem for and on behalf of the Customer, all or part
of the Customer's Shares to the extent necessary to maintain the required
minimum balance.

Each Fund reserves the right to redeem a shareholder's Trust Shares if
the shareholder does not maintain a balance of [$25,000] in the Trust Shares of
that Fund. Alternatively, the Fund may charge a shareholder whose account falls
below the minimum a fee of [$_______]. Employees of SBCL will not be required to
maintain a minimum balance in Trust Shares of the Funds.

REDEMPTION BY MAIL

A written request for redemption must be received by the Group in order
to constitute a valid tender for redemption. The signature on the written
request must be guaranteed by a bank, broker, dealer, credit union, securities
exchange, securities association, clearing agency or savings association, as
those terms are defined in Rule 17Ad-15 under the Securities Exchange Act of
1934 if (a) a redemption check is to be payable to anyone other than the
Shareholder(s) of record; or (b) a redemption check is to be mailed to the
Shareholder(s) at an address other than the address of record or other than to a
commercial bank designated on the Account Registration Form of such
Shareholder(s); or (c) a redemption check is to be mailed to an address that has
not been on the Group's books for sixty days. The Distributor reserves the right
to reject any signature guarantee if (1) it has reason to believe that the
signature is not genuine, (2) it has reason to believe that the transaction
would otherwise be improper, or (3) the guarantor institution is a broker or
dealer that is neither a member of a clearing corporation nor maintains net
capital of at least $100,000. A notary public will not be accepted as a
signature guarantee. Proceeds may be mailed to the address of record or sent
electronically or mailed to a previously designated bank account without a
signature guarantee.

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<PAGE> 26

See "Redemption by Telephone" for further discussion regarding sending proceeds
to your bank account.

REDEMPTION BY TELEPHONE

Shares may be redeemed by telephone [only] if the Shareholder selected
that option on the Account Registration Form. A Shareholder may have the
proceeds mailed to the address of record or sent electronically or mailed
directly to a domestic commercial bank account previously designated by the
Shareholder on the Account Registration Form. Under most circumstances, such
payments will be transmitted on the next Business Day following receipt of a
valid request for redemption. Such electronic redemption requests may be made by
the Shareholder by telephone to the Transfer Agent. The Transfer Agent will
reduce the amount of a wire redemption payment by its then-current wire
redemption charge. Such charge is presently $[7.00] for each wire redemption.
There is no charge for having payment of redemption requests mailed or sent via
the Automated Clearing House to a designated bank account. For telephone
redemptions, contact SBCL or your Participating Organization.

TELEPHONE PROCEDURES

The Distributor, the Transfer Agent, SBCL and the Group will not be
liable for any losses, damages, expenses or costs arising out of any telephone
transaction (including purchases, exchanges, and redemptions) effected in
accordance with the Group's telephone transaction procedures, upon instructions
reasonably believed to be genuine. The Group will employ procedures designed to
provide reasonable assurance that instructions communicated by telephone are
genuine; if these procedures are followed, the Group will not be liable for any
losses due to unauthorized or fraudulent instructions. These procedures include
recording phone conversations, sending confirmations to Shareholders within 72
hours of the telephone transaction, verifying the account name and a
shareholder's account number or tax identification number and sending redemption
proceeds only to the address of record or to a previously authorized bank
account. If, due to temporary adverse conditions, investors are unable to effect
telephone transactions, Shareholders may mail redemption requests to the Group.

PAYMENTS TO SHAREHOLDERS

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<PAGE> 27

the Group or the Shareholders of the particular Fund to sell or liquidate
portfolio securities in an amount sufficient to satisfy requests for payments in
that manner. The Money Market Funds will attempt to honor requests from
Shareholders for same day payment upon redemption of Shares if the request for
redemption is received by the Transfer Agent before 4:00 p.m. Eastern time, on
a Business Day or, if the request for redemption is received after 4:00 p.m.
Eastern time, to honor requests for payment on the next Business Day, unless it
would be disadvantageous to the Fund or its Shareholders to sell or liquidate
portfolio securities in an amount sufficient to satisfy requests for payments in
that manner.

In some instances, a Fund may be requested to redeem Shares for which
it has not yet received good payment. Under such circumstances, the Group may
delay forwarding the proceeds until payment has been collected for the purchase
of such Shares, which may take up to 15 days or more. To avoid delay in payment
upon redemption, investors should purchase Shares by certified check or by wire
transfer. The Group intends to pay cash for all Shares redeemed, but under
abnormal conditions which may make payment in cash unwise, the Group may make
payment wholly or partly in portfolio securities at their then current market
value equal to the redemption price. In such cases, an investor may incur
brokerage costs in converting such securities to cash.

See "ADDITIONAL PURCHASE AND REDEMPTION INFORMATION" in the Statement
of Additional Information for examples of when the Group may suspend the right
of redemption or redeem Shares involuntarily if it appears appropriate to do so
in light of the Group's responsibilities under the 1940 Act.

DIVIDENDS AND TAXES

Each Fund will be treated as a separate entity for federal income tax
purposes. Each Fund intends to qualify for treatment as a "regulated investment
company" under the Internal Revenue Code of 1986 (the "Code"). If qualified, a
Fund will not have to pay federal taxes on amounts it distributes to
Shareholders. Regulated investment companies are subject to a federal excise tax
if they do not distribute substantially all of their income on a timely basis.
Each Fund intends to avoid paying federal income and excise taxes by timely
distributing substantially all its net investment income and net realized
capital gains.

Dividends received by a Shareholder of a Fund that are derived from
such Fund's investments in U.S. government securities may not be entitled to the
exemption from state and local income taxes that would be available if the
Shareholder had purchased U.S. government securities directly. Shareholders are
advised to consult their tax adviser concerning the application of state and
local taxes to distributions received from a Fund.

Shareholders will be advised at least annually as to the amount and
federal income tax character of distributions made during the year.

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<PAGE> 28

The net investment income of each Money Market Fund is declared daily
as a dividend to Shareholders at the close of business on the day of
declaration. Dividends will generally be paid monthly. The Money Market Funds do
not expect to realize any long-term capital gains and, therefore, do not foresee
paying any "capital gains dividends" as described in the Code. However, any such
capital gains will be distributed no more than twice a year after deduction for
any available capital loss carryforward.

The amount of dividends payable with respect to the Trust Shares will
exceed dividends on Class A Shares due to the Distribution and Shareholder
Services Plan fee applicable to Class A Shares.

A dividend on the Shares of the Investment Grade Bond Fund is declared
daily and paid monthly. A dividend on the Shares of the Global Asset Allocation
Fund is declared and paid annually. A dividend on the Shares of the Equity Fund
is declared and paid monthly. Net realized capital gains, if any, are
distributed at least annually to Shareholders of record after deduction for any
available capital loss carry forward.

A Shareholder will automatically receive all income dividends and
capital gain distributions in additional full and fractional Shares at net asset
value as of the date of payment unless the Shareholder elects to receive such
dividends or distributions in cash. Such election, or any revocation thereof,
must be made in writing to the Sanwa Mutual Funds Group, P.O. Box XXXX,
Columbus, Ohio XXXXX-XXXX, and will become effective with respect to dividends
and distributions having record dates after its receipt by the Transfer Agent.
Reinvested dividends receive the same tax treatment as dividends paid in cash.
Dividends are paid in cash not later than seven Business Days after a
Shareholder's complete redemption of his or her Shares. If you elect to receive
distributions in cash, and checks (1) are returned and marked as "undeliverable"
or (2) remain uncashed for six months, your cash election will be changed
automatically and your future dividend and capital gains distributions will be
reinvested in the Fund at the per share net asset value determined as of the
date of payment of the distribution. In addition, any undeliverable checks or
checks that remain uncashed for six months will be cancelled and will be
reinvested in the Fund at the per share net asset value determined as of the
date of cancellation.

Dividends are generally taxable in the taxable year received. However,
dividends declared in October, November or December to Shareholders of record
during such a month and paid during the following January are treated for tax
purposes as if they were received by each Shareholder on December 31 of the year
in which the dividends were declared.

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<PAGE> 29

income of the remaining Funds is expected to be interest income, it is
anticipated that no distributions from such Funds will qualify for the dividends
received deduction. Distributions of net realized capital gains are taxable to
Shareholders as long-term capital gains regardless of how long the Shareholder
has held Shares in the Fund. Shareholders who are not subject to tax on their
income generally will not have to pay federal income tax on amounts distributed
to them.

Dividends that are derived from interest on a Fund's investments in
U.S. government securities may be eligible for exemption from the state and
local taxes of certain jurisdictions, although state and local tax authorities
may not agree with this view. However, distributions of income derived from
repurchase agreements and securities lending transactions generally will not
qualify for exemption from state and local income taxes.

The foregoing is a summary of certain federal, state and local income
tax consequences of investing in a Fund. Shareholders should consult their own
tax advisers concerning the tax consequences of an investment in a Fund.

TAX CONSIDERATIONS RELATING TO THE
GLOBAL ASSET ALLOCATION FUND

Dividends and certain interest income earned by the Global Asset
Allocation Fund from foreign securities may be subject to foreign withholding
taxes or other taxes. So long as more than 50% of the value of the Fund's total
assets at the close of any taxable year consists of stock or securities of
foreign corporations, the Fund may elect, for federal income tax purposes, to
treat certain foreign taxes paid by it, including generally any withholding
taxes and other foreign income taxes, as paid by its shareholders. It is
possible that the Global Asset Allocation Fund will make this election in
certain years. The remaining Funds do not expect to be eligible to make this
election. If a Fund makes the election, the amount of such foreign taxes paid by
a Fund will be included in its shareholders' income pro rata (in addition to
taxable distributions actually received by them), and each shareholder will be
entitled either (a) to credit a proportionate amount of such taxes against a
shareholder's federal income tax liabilities, or (b) if a shareholder itemizes
deductions, to deduct such proportionate amounts from federal taxable income.

Fund transactions in foreign currencies and hedging activities may give
rise to ordinary income or loss to the extent such income or loss results from
fluctuations in value of the foreign currency concerned. In addition, such
activities will likely produce a difference between book income and taxable
income. This difference may cause a portion of a Fund's income distributions to
constitute a return of capital for tax purposes or require the Fund to make
distributions exceeding book income to qualify as a regulated investment company
for tax purposes.

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<PAGE> 30

MANAGEMENT OF SANWA MUTUAL FUNDS GROUP

TRUSTEES OF THE GROUP

The Board of Trustees of the Group has overall responsibility for the
Funds. The Board of Trustees is elected by the Shareholders. There are currently
[FIVE] Trustees, two of whom are "interested persons" of the Group within the
meaning of that term under the 1940 Act. The Trustees, in turn, elect the
officers of the Group to supervise its day-to-day operations.

INVESTMENT ADVISER

SBCL serves as Investment Adviser of each Fund. SBCL is a wholly-owned
subsidiary of The Sanwa Bank Limited, of Japan. Its principal offices are
located at 601 South Figueroa Street, Los Angeles, California 90017.

Established in 1972, SBCL provides a full range of personal and
business banking services through a network of more than 100 branches and
offices statewide. As of _____________, 1997, SBCL had nearly [_______] of
assets under management.

Subject to the general supervision of the Group's Board of Trustees and
in accordance with the investment objectives and restrictions of a Fund, SBCL
manages the Funds, makes decisions with respect to, and places orders for, all
purchases and sales of its investment securities, and maintains its records
relating to such purchases and sales.

Under an investment advisory agreement between the Group and SBCL, the
fee payable to SBCL by each Fund for investment advisory services is the lesser
of: (a) a fee computed daily and paid monthly at the annual rate of thirty
one-hundredths of one percent (0.30%) of the Prime Money Market Fund's average
daily net assets; twenty one-hundredths of one percent (0.20%) of the U.S.
Treasury Obligations Fund's average daily net assets; sixty one-hundredths of
one percent (0.60%) of the Investment Grade Bond Fund's average daily net
assets; ninety one-hundredths of one percent (0.90%) of the Global Asset
Allocation Fund's average daily net assets; and seventy five one-hundredths of
one percent (0.75%) of the Equity Fund's average daily net assets, or (b) such
fee as may from time to time be agreed upon by the Group and SBCL. The fee
agreed to from time to time by the Group and SBCL may be significantly lower
than the fee calculated at the annual rate and the effect of such agreed upon
lower fee would be to lower a Fund's expenses and increase the net income of the
Fund during the period when such agreed upon lower fee is in effect.

-26-

<PAGE> 31

purchase and sale activity. The committee adjusts holdings in the portfolio as
it deems appropriate in pursuit of the fund's investment objectives. Individual
portfolio managers of the committee may also adjust portfolio holdings of each
Fund as necessary between team meetings.

ADMINISTRATOR AND DISTRIBUTOR

BISYS Fund Services, Inc. is the administrator for each Fund and also
acts as the Group's principal underwriter and distributor (the "Administrator"
or the "Distributor"), under agreements approved by the Group's Board of
Trustees. BISYS Fund Services, Inc. is wholly owned by The BISYS Group, Inc.,
150 Clove Road, Little Falls, New Jersey 07424, a publicly owned company engaged
in information processing, loan servicing and 401(k) administration and
recordkeeping services to and through banking and other financial organizations.

The Administrator generally assists in all aspects of a Fund's
administration and operation. Under a management and administration agreement
between the Group and the Administrator, the fee payable by a Fund to the
Administrator for management administration services is the lesser of (a) a fee
computed at the annual rate of twenty one-hundredths of one percent (.20%) of a
Fund's average daily net assets or (b) such fee as may from time to time be
agreed upon by the Group and the Administrator. A fee agreed to from time to
time by the Group and the Administrator may be significantly lower than the fee
calculated at the annual rate and the effect of such agreed upon lower fee would
be to lower a Fund's expenses and increase the net income of the Fund during the
period when such agreed upon lower fee is in effect.

EXPENSES

SBCL and the Administrator each bear all expenses in connection with
the performance of their services as investment adviser and administrator,
respectively, other than the cost of securities (including brokerage
commissions, if any) purchased for a Fund. Each Fund bears the following
expenses relating to its operations: taxes, interest, any brokerage fees and
commissions, fees and travel expenses of the Trustees of the Group, Commission
fees, state securities qualification and renewal fees, costs of preparing and
printing prospectuses for regulatory purposes and for distribution to current
Shareholders, outside auditing and legal expenses, amortized organizational
expenses, advisory and administration fees, fees and out-of-pocket expenses of
the custodian and the Transfer Agent, fees and out-of-pocket expenses for fund
accounting services, expenses incurred for pricing securities owned by a Fund,
certain insurance premiums, costs of maintenance of a Fund's existence, costs
and expenses of Shareholders' and Trustees' reports and meetings, and any
extraordinary expenses incurred in its operation. As a general matter, expenses
are allocated to the Class A Shares and Trust Shares of a Fund on the basis of
the relative net asset value of each class. At present, the only expenses that
will be borne solely by Class A Shares, other than in

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<PAGE> 32

accordance with the relative net asset value of the class, are expenses under
the Group's Distribution and Shareholder Services Plan ("Distribution Plan")
which relate only to the Class A Shares.

The organizational expenses of each Fund have been capitalized and are
being amortized in the first five years of each Fund's operations. Such
amortization will reduce the amount of income available for payment as
dividends.

DISTRIBUTION PLAN

The Distribution Plan contains a so-called "defensive" provision
applicable to all classes of Shares. Under this defensive provision to the
extent that any payment made to the Administrator, including payment of
administration fees, should be deemed to be indirect financing of any activity
primarily intended to result in the sale of Shares issued by the Group's Funds
within the context of Rule 12b-1 under the 1940 Act, such payment shall be
deemed to be authorized by the Distribution Plan.

BANKING LAWS

SBCL believes that it possesses the legal authority to perform the
investment advisory services for the Group contemplated by its investment
advisory agreement with the Group and described in this Prospectus without
violation of applicable banking laws and regulations, and has so represented to
the Group. Future changes in federal or state statutes and regulations relating
to permissible activities of banks or bank holding companies and their
subsidiaries and affiliates as well as further judicial or administrative
decisions or interpretations of present and future statutes and regulations
could change the manner in which SBCL could continue to perform such services
for the Group. See "MANAGEMENT OF SANWA MUTUAL FUNDS GROUP--Glass Steagall Act"
in the Statement of Additional Information for further discussion of applicable
banking laws and regulations.

GENERAL INFORMATION

DESCRIPTION OF THE GROUP AND ITS SHARES

The Group was organized as a Massachusetts business trust on April 7,
1997 and commenced operations on _______________, 1997. The Group has an
unlimited number of authorized Shares of beneficial interest which may, without
Shareholder approval, be divided into an unlimited number of series of such
Shares, and which are presently divided into five series of Shares, one for each
of the following Funds: the Sanwa Prime Money Market Fund, the Sanwa U.S.
Treasury Obligations Fund, the Sanwa Investment Grade Bond Fund, the Sanwa
Global Asset Allocation Fund, and the Sanwa Equity Fund. Each Fund offers to the
public two classes of shares: Class A and Trust Shares. Each Share represents an
equal

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<PAGE> 33

proportionate interest in a Fund with other Shares of the same series and class,
and is entitled to such dividends and distributions out of the income earned on
the assets belonging to that Fund as are declared at the discretion of the
Trustees (see "Miscellaneous" below).

Shareholders are entitled to one vote per Share (with proportional
voting for fractional Shares) on such matters as Shareholders are entitled to
vote. Shareholders vote in the aggregate and not by series or class on all
matters except (i) when required by the 1940 Act, Shares shall be voted by
individual series, (ii) when the Trustees have determined that the matter
affects only the interests of a particular series or class, and (iii) only the
holders of Class A Shares will be entitled to vote on matters submitted to
Shareholder vote with regard to the Distribution Plan applicable to such class.

As used in this Prospectus and in the Statement of Additional
Information, a "vote of a majority of the outstanding Shares" of the Group or a
particular Fund means the affirmative vote, at a meeting of Shareholders duly
called, of the lesser of (a) 67% or more of the votes of Shareholders of the
Group or such Fund present at such meeting at which the holders of more than 50%
of the votes attributable to the Shareholders of record of the Group or such
Fund are represented in person or by proxy, or (b) the holders of more than 50%
of the outstanding votes of Shareholders of the Group or such Fund.

Overall responsibility for the management of the Group is vested in the
Board of Trustees. See "MANAGEMENT OF SANWA MUTUAL FUNDS GROUP--Trustees of the
Group." Individual Trustees are elected by the Shareholders and may be removed
by the Board of Trustees or Shareholders at a meeting held for such purpose in
accordance with the provisions of the Declaration of Trust and the By-laws of
the Group and Massachusetts law. See "ADDITIONAL INFORMATION--Miscellaneous" in
the Statement of Additional Information for further information.

Although the Group is not required to hold annual meetings of
Shareholders, Shareholders holding at least 10% of the Group's outstanding
Shares have the right to call a meeting to elect or remove one or more of the
Trustees of the Group. Shareholder inquiries should be directed to the Secretary
of the Group at 3435 Stelzer Road, Columbus, Ohio 43219.

CUSTODIAN, TRANSFER AGENT AND FUND ACCOUNTANT

_______________, serves as Custodian for the Group.

BISYS Fund Services, Inc. serves as transfer agent for and provides
fund accounting services to the Group.

OTHER CLASSES OF SHARES

In addition to Trust Shares, the Group also offers Class A of each
Fund. Class A Shares are offered to the general public at net asset value and
are subject to a Distribution and Shareholder Services Plan fee.

-29-

<PAGE> 34

PERFORMANCE INFORMATION

GENERAL. From time to time, a Money Market Fund's annualized "yield"
and "effective yield" and total return for Trust Shares may be presented in
advertisements, sales literature and shareholder reports. The "yield" of a Money
Market Fund is based upon the income earned by the Fund over a seven-day period
and then annualized, i.e., the income earned in the period is assumed to be
earned every seven days over a 52-week period and is stated as a percentage of
the investment. The "effective yield" of a Money Market Fund is calculated
similarly but when annualized, the income earned by the investment is assumed to
be reinvested in Shares of the Group and thus compounded in the course of a
52-week period. The effective yield will be higher than the yield because of the
compounding effect of the assumed reinvestment.

Total return is calculated for the past year and the period since the
establishment of each Money Market Fund. Average annual total return is measured
by comparing the value of an investment in a Fund at the beginning of the
relevant period to the redemption value of the investment at the end of the
period (assuming immediate reinvestment of any dividends or capital gains
distributions) and annualizing the result. Aggregate total return is calculated
similarly to average annual total return except that the return figure is
aggregated over the relevant period instead of annualized.

From time to time performance information of the Investment Grade Bond
Fund, the Global Asset Allocation Fund, and the Equity Fund, showing its average
annual total return, aggregate total return, and/or yield may be presented in
advertisements, sales literature and shareholder reports. Such performance
figures are based on historical earnings and are not intended to indicate future
performance. Average annual total return will be calculated for the period since
the establishment of a Fund. Average annual total return is measured by
comparing the value of an investment in a Fund at the beginning of the relevant
period to the redemption value of an investment at the end of the period
(assuming immediate reinvestment of any dividends or capital gains
distributions) and annualizing the result. Aggregate total return is calculated
similarly to average annual total return except that the return figure is
aggregated over the relevant period instead of annualized. Yield will be
computed by dividing the net investment income per Share for the Investment
Grade Bond Fund, the Global Asset Allocation Fund, and the Equity Fund earned
during a recent 30-day period by the Fund's per Share maximum offering price
(reduced by any undeclared earned income expected to be paid shortly as a
dividend) on the last day of the period and annualizing the results.

Each Fund may also present its average annual total return, aggregate
total return, yield and/or tax equivalent yield, as the case may be, excluding
the effect of a sales charge, if any.

The Investment Grade Bond Fund, the Global Asset Allocation Fund, and
the Equity Fund may also calculate a distribution rate. Distribution rates will
be computed by dividing the distribution per Share of a class made by a Fund
over a twelve-month period by the

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<PAGE> 35

maximum offering price per Share. The distribution rate includes both income and
capital gain dividends and does not reflect unrealized gains or losses. The
calculation of income in the distribution rate includes both income and capital
gain dividends and does not reflect unrealized gains or losses, although a Fund
may also present a distribution rate excluding the effect of capital gains. The
distribution rate differs from the yield, because it includes capital items
which are often non-recurring in nature, and may include returns of principal,
whereas yield does not include such items. The Funds do not intend to publish
distribution rates in Fund advertisements but may publish such rates in
supplemental sales literature. Distribution rates may also be presented
excluding the effect of a sales charge, if any.

Yield, effective yield, total return and distribution rate will be
calculated separately for each Class of Shares. Because Trust Shares are not
subject to Distribution Plan fees, the yield and total return for Trust Shares
will be higher than that of the Class A Shares for the same period.

Investors may also judge the performance of a Fund by comparing its
performance to the performance of other mutual funds with comparable investment
objectives and policies through various mutual fund or market indices and data
such as that provided by Lipper Analytical Services, Inc., IBC/Donoghue's MONEY
FUND REPORT and Ibbotson Associates, Inc. References may also be made to indices
or data published in Money Magazine, Forbes, Barron's, The Wall Street Journal,
The New York Times, Business Week, American Banker, Fortune, Institutional
Investor, Ibbotson Associates, Inc., Morningstar, Inc., CDA/Weisenberger,
Pension and Investments, U.S.A. Today and local newspapers. In addition to
performance information, general information about the Funds that appears in a
publication such as those mentioned above may be included in advertisements and
in reports to Shareholders.

Information about the performance of a Fund is based on a Fund's record
up to a certain date and is not intended to indicate future performance. Yields
and total returns of a Fund will fluctuate. Any fees charged by the
Participating Organizations to their customers in connection with investment in
a Fund are not reflected in the Group's performance information.

Further information about the performance of a Fund is contained in
that Fund's annual report to Shareholders, which may be obtained without charge
by calling (800) XXX-XXXX.

PAST PERFORMANCE. Each of the Prime Money Market Fund, the Investment
Grade Bond Fund, and the Equity Fund commenced operations on October __, 1997
subsequent to the transfer of assets by a common or collective trust fund (a
"Portfolio") to a Fund in exchange for shares of that Fund (the "Transfer").
Each Fund's portfolio of investments on October , 1997 was the same as a
Portfolio's immediately prior to the Transfer. The Portfolios that transferred
assets to each Fund are:

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<PAGE> 36

<TABLE>
<CAPTION>
COMMON/COLLECTIVE PORTFOLIO SANWA FUND
<S> <C>
ITS Money Market Fund (Collective) [A] Portfolio Prime Money Market Fund
ITS Bond Investment Fund (Collective) and
PFS Bond Investment Fund (Common) [B] Portfolio Investment Grade Bond Fund
ITS Common Stock Investment Fund (Collective) and
PFS Common Stock Investment Fund (Common) [C] Portfolio Equity Fund
</TABLE>

None of the Portfolios are a registered investment company as each
Portfolio is exempt from registration under the 1940 Act. Since, in a practical
sense, each Portfolio constitutes a "predecessor" of a Fund, for periods
commencing prior to the Transfer, each Fund calculates performance based on the
Portfolio's performance adjusted to reflect the deduction of the applicable Fund
or class fees and expenses as stated in the Fee Table in that Fund's or class'
prospectus (i.e., adjusted to reflect anticipated expenses, net of management
and administrative fee waivers). These fees and expenses include any applicable
Rule 12b-1 fees.

Each Fund from time to time may advertise certain investment
performance figures, as discussed below. These figures are based on historical
earnings, but past performance data is not necessarily indicative of future
performance of the Fund.

<TABLE>
AVERAGE ANNUAL TOTAL RETURN
AS OF JUNE 30, 1997
<CAPTION>
Common/Collective Portfolio 1 year 3 years 5 years 10 years
- --------------------------- ------ ------- ------- --------
<S> <C> <C> <C> <C>
[A] Portfolio(1) 5.07% 5.12% 4.36% 5.89%
[B] Portfolio 6.84% 2.47%(2) N/A N/A
[C] Portfolio 32.62% 26.98% 24.88%(3) N/A
</TABLE>

(1) The 7-day yield, 7-day effective yield and 30-day yield for the Prime
Money Market Fund's predecessor, [A] Portfolio, as of June 30, 1997 were
5.12%, 5.25% and 5.11% respectively.

(2) Since the date that the Investment Grade Bond Fund's predecessor's
investment objective and policies were amended to be consistent with those
of the Investment Grade Bond Fund: January 31, 1996.

(3) Since the date that the Equity Fund's predecessor's investment objective
and policies were amended to be consistent with those of the Equity Fund:
March 31, 1994.

The above-quoted performance data includes the performance of each
Portfolio for the period before the Funds commenced operations adjusted to
reflect the deduction of fees and expenses applicable to the Trust Shares of
each Fund (i.e., adjusted to reflect anticipated expenses, net of management and
administrative fee waivers). The Portfolios were not registered under the 1940
Act and therefore were not subject to certain investment restrictions imposed by
the 1940 Act. If a Portfolio had been registered under the 1940 Act, its
performance may have been adversely affected.

MISCELLANEOUS

Shareholders will receive unaudited semi-annual reports describing the
investment operations of their Fund(s) and annual financial statements audited
by independent public accountants.

Inquiries regarding the Group may be directed in writing to the Group
at the following address: the Sanwa Mutual Funds Group, P.O. Box XXXXX,
Columbus, Ohio XXXXX- XXXX or by calling toll free (800) XXX-XXXX.

-32-

<PAGE> 37

INVESTMENT ADVISER
Sanwa Bank California
Investment Management Department
601 S. Figueroa Street
Los Angeles, California 90017

ADMINISTRATOR AND DISTRIBUTOR
BISYS Fund Services, Inc.
3435 Stelzer Road
Columbus, Ohio 43219

LEGAL COUNSEL
Ropes & Gray
One Franklin Square
1301 K Street, N.W.
Suite 800 East
Washington, DC 20005

TRANSFER AGENT
BISYS Fund Services, Inc.
3435 Stelzer Road
Columbus, Ohio 43219

AUDITORS
Ernst & Young

CUSTODIAN

---------------

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<PAGE> 38
CROSS REFERENCE SHEET
---------------------

PROSPECTUS FOR SANWA MUTUAL FUNDS GROUP
---------------------------------------

CLASS A SHARES
--------------

<TABLE>
<CAPTION>
Part A Item Prospectus Caption
- ----------- ------------------
<S> <C>
Cover Page.................................................... Cover Page

Synopsis...................................................... Prospectus Summary; Fee Table

Condensed Financial Information............................... Inapplicable

General Description
of Registrant.............................................. Prospectus Summary; Investment
Objective and Policies; General
Information - Description of the Group
and Its Shares

Management of Sanwa
Mutual Funds Group......................................... Management of Sanwa Mutual Funds
Group; General Information

Management's Discussion of
Fund Performance............................................ Inapplicable

Redemption or Repurchase...................................... How to Purchase and Redeem Shares

Pending Legal Proceedings..................................... Inapplicable
</TABLE>

<PAGE> 39

MONEY MARKET FUNDS
------------------

Prime Money Market Fund
U.S. Treasury Obligations Fund

BOND FUND
---------

Investment Grade Bond Fund

BALANCED FUND
-------------

Global Asset Allocation Fund

STOCK FUND
----------

Equity Fund

CLASS A SHARES

SANWA BANK CALIFORNIA
INVESTMENT ADVISER

BISYS FUND SERVICES, INC.
ADMINISTRATOR AND DISTRIBUTOR

PROSPECTUS DATED [_________], 1997

<PAGE> 40

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary......................................................................................
Fee Table...............................................................................................
Investment Objective and Policies.......................................................................
Valuation of Shares.....................................................................................
How to Purchase and Redeem Shares.......................................................................
Dividends and Taxes.....................................................................................
Management of Sanwa Mutual Funds Group..................................................................
General Information.....................................................................................
</TABLE>

-i-

<PAGE> 41

SANWA MUTUAL FUNDS GROUP

3435 Stelzer Road For current yield, purchase,
Columbus, Ohio 43219 and redemption information,
Investment Adviser: Sanwa Bank California call (800) XXX-XXXX
TDD/TTY call (800) XXX-XXXX

THE SANWA PRIME MONEY MARKET FUND (the "Prime Money Market Fund") seeks
as high a level of current income as is consistent with maintaining liquidity
and stability of principal.

THE SANWA INVESTMENT GRADE BOND FUND (the "Investment Grade Bond Fund")
seeks a high level of income, consistent with preservation of capital.

THE SANWA EQUITY FUND (the "Equity Fund") seeks long-term capital
growth. The Fund intends to invest in the common stocks of corporations
representing a broad cross section of the U.S. economy. The Fund expects to have
a level of risk commensurate with that represented by a broadly diversified
portfolio of U.S. common stocks, such as the Standard & Poor's 500 Index.

<PAGE> 42

This Prospectus relates to the Class A Shares of the Group, which are
offered to the general public. Through a separate prospectus, the Group also
offers Trust Shares to Sanwa Bank California and its affiliates and other
financial service providers approved by the Distributor for the investment of
funds for which they act in a fiduciary, advisory, agency, custodial (other than
for individual retirement accounts) or similar capacity. A Statement of
Additional Information, dated ________, 1997 (as may be amended from time to
time), has been filed with the Securities and Exchange Commission and is
incorporated herein by reference. The Statement of Additional Information and
the prospectus relating to the Trust Shares are available without charge by
writing or by calling the Group at the address or telephone number shown above.

This Prospectus sets forth concisely the information an investor should
know before investing and should be read carefully and retained for future
reference.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION ("COMMISSION") OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

The date of this Prospectus is [___________], 1997.

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<PAGE> 43

PROSPECTUS SUMMARY

Investment Objective THE PRIME MONEY MARKET FUND seeks as high a level of
current income as is consistent with maintaining liquidity
and stability of principal.

THE U.S. TREASURY OBLIGATIONS FUND seeks current income
consistent with liquidity and stability of principal.

THE INVESTMENT GRADE BOND FUND seeks a high level of
income, consistent with preservation of capital.

THE GLOBAL ASSET ALLOCATION FUND seeks a balance of income
and long-term capital appreciation.

THE EQUITY FUND seeks long-term capital growth.

Investment Risks There can be no assurance that any Fund will achieve its
investment objective. Each Fund's net asset value or
performance may vary daily, reflecting fluctuations in the
market value of its portfolio holdings, interest rate
levels, and market conditions. The Prime Money Market Fund,
the Investment Grade Bond Fund, and the Global Asset
Allocation Fund may invest in foreign securities which
entails certain risks. See "Foreign Securities."

Offering Price The public offering price of the Prime Money Market Fund
and the U.S. Treasury Obligations Fund is equal to that
Fund's net asset value per Class A Share, which each Fund
will seek to maintain at $1.00.

The public offering price of the Investment Grade Bond
Fund, the Global Asset Allocation Fund, and the Equity Fund
is equal to that Fund's net asset value per Class A Share.
See "HOW TO PURCHASE AND REDEEM SHARES--Purchases of Class
A Shares."

-3-

<PAGE> 44

Maximum Purchase For Class A Shares there is no maximum purchase. See "HOW
TO PURCHASE AND REDEEM SHARES -- Purchases of Class A
Shares."

Minimum Purchase For Class A Shares there is a $1,000 minimum initial
investment, or a $50 minimum initial investment if
investing through the Group's Automatic Investment Plan,
and a $50 minimum investment for subsequent purchases. See
"HOW TO PURCHASE AND REDEEM SHARES--Purchases of Class A
Shares."

Investment Adviser Sanwa Bank California ("SBCL"), Los Angeles, California.

Dividends The Prime Money Market Fund, the U.S. Treasury Obligations
Fund, and the Investment Grade Bond Fund declare dividends
daily and pay such dividends monthly. The Global Asset
Allocation Fund declares and pays dividends annually. The
Equity Fund declares and pays dividends monthly.

Distributor BISYS Fund Services, Inc., Columbus, Ohio.

-4-

<PAGE> 45

FEE TABLE

The following tables are intended to assist investors in understanding
the expenses associated with investing in Class A Shares of the Funds.

<TABLE>
<CAPTION>
PRIME U.S. TREASURY INVESTMENT
MONEY MARKET OBLIGATIONS GRADE BOND GLOBAL ASSET EQUITY
FUND FUND FUND ALLOCATION FUND FUND
---- ---- ---- --------------- ----
CLASS A CLASS A CLASS A CLASS A CLASS A
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES(1)
Maximum Sales Load on Purchases 0% 0% 0% 0% 0%
Maximum Sales Load on
Reinvested Dividends 0% 0% 0% 0% 0%
Maximum Deferred Sales Load 0% 0% 0% 0% 0%
Redemption Fees(2) $0 $0 $0 $0 $0
Exchange Fee $0 $0 $0 $0 $0
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF NET ASSETS)(3)
Management Fees (after voluntary
fee reductions) 0.20% 0.10% 0.50% 0.80% 0.65%
12b-1 Fee 0.25% 0.25% 0.25% 0.25% 0.25%
Other Expenses(4) 0.38% 0.41% 0.39% 0.64% 0.40%
----- ----- ----- ----- -----
Total Fund Operating Expenses
(after voluntary fee reductions) 0.83% 0.76% 1.14% 1.69% 1.30%
===== ===== ===== ===== =====
</TABLE>
- ---------------------
1 A Participating Organization or Bank (as defined in this Prospectus) may
charge a Customer's (as defined in this Prospectus) account fees for
automatic investments, exchanges, and other investment management services
provided in connection with investment in Class A Shares of a Fund. See
"HOW TO PURCHASE AND REDEEM SHARES--"Purchases of Class A Shares" and "HOW
TO PURCHASE AND REDEEM SHARES--Exchange Privilege."

3 SBCL has agreed to voluntarily reduce the amount of its investment advisory
fee through the end of the Fund's initial fiscal year. Absent the voluntary
reduction of investment advisory fees, Management Fees and Total Operating
Expenses as a percentage of average daily net assets for Class A Shares
would be 0.30% and 0.93%, respectively, for the Prime Money Market Fund;
0.20% and 0.86%, respectively, for the U.S. Treasury Obligations Fund;
0.60% and 1.24%, respectively, for the Investment Grade Bond Fund; 0.90%
and 1.79%, respectively, for the Global Asset Allocation Fund; and 0.75%
and 1.40%, respectively, for the Equity Fund.

4 "Other Expenses" are based on estimated amounts for the current fiscal
year.

EXAMPLE:

You would pay the following expenses on a $1,000 investment in Class A Shares of
the Funds, assuming (1) 5% annual return and (2) redemption at the end of each
time period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<S> <C> <C>
Prime Money Market Fund $8 $26
U.S. Treasury Obligations Fund $8 $24
Investment Grade Bond Fund $12 $36
Global Asset Allocation Fund $17 $53
Equity Fund $13 $41
</TABLE>

These tables are intended to assist investors in understanding the
various costs and expenses associated with investing in the Funds. See
"MANAGEMENT OF SANWA MUTUAL FUNDS GROUP" for a more complete discussion of
annual operating expenses of each Fund. THE EXAMPLE IS NOT A REPRESENTATION OF
PAST OR FUTURE EXPENSES. THE FUND'S ACTUAL EXPENSES MAY BE GREATER OR LESS THAN
THOSE SHOWN.

Long-term shareholders of Class A Shares may pay more than the
equivalent of the maximum front-end sales charges otherwise permitted by NASD
Rules.

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<PAGE> 46

INVESTMENT OBJECTIVES AND POLICIES

MONEY MARKET FUNDS

Each Money Market Fund will endeavor to achieve its investment
objective by investing in a portfolio of high-quality money market instruments
which complies with the diversification and other requirements of Rule 2a-7
under the Investment Company Act of 1940 (the "1940 Act"). All instruments in
which the Money Market Funds invest will be deemed to have maturities of 397
days or less. The average dollar weighted maturity of each Money Market Fund's
portfolio will not exceed 90 days. See "VALUATION OF SHARES" and the Statement
of Additional Information for a further explanation of the amortized cost
valuation method.

PRIME MONEY MARKET FUND

U.S. TREASURY OBLIGATIONS FUND

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<PAGE> 47

INVESTMENT GRADE BOND FUND

The Fund may hold securities of foreign issuers, provided such
securities are denominated in U.S. dollars. The Fund may also invest in bond
(interest rate)

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<PAGE> 48

options to a limited extent. See "Investment Objective and Policies--Specific
Investment Policies."

GLOBAL ASSET ALLOCATION FUND

The Fund will invest in a varying combination of stocks, bonds, and
cash selected primarily from major markets such as: the United States, Japan,
the U.K., Germany, France, Switzerland, Spain, Canada and Australia.
The Fund may also invest in other markets, including emerging markets.

Under normal circumstances, at least 65% of the Fund's net assets will
be invested in securities representing at least three different countries,
including the United States.

In order to execute its strategy in an efficient manner, SBCL may
utilize equity index, bond index, and currency futures contracts in the various
countries. The Fund will use futures

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<PAGE> 49

contracts to provide an efficient means of achieving broad market exposure to
the stock, fixed income and currency markets of a particular country, to provide
liquidity, and to facilitate asset allocation shifts. Currency futures provide
an efficient vehicle for hedging foreign exchange exposure. By investing in a
stock index futures contract the Fund is exposed to an index of stocks without
buying each underlying security in that index. SBCL will not use futures to
leverage the Fund's holdings. See "Options and Futures" in the Statement of
Additional Information for a more detailed discussion of the risks associated
with investment in futures contracts.

EQUITY FUND

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<PAGE> 50

Fund's net assets. SBCL will not use futures to leverage the Fund's holdings.
See "Options and Futures" in the Statement of Additional Information for a more
detailed discussion of the risks associated with investments in futures
contracts.

ALL FUNDS

SPECIFIC INVESTMENT POLICIES

# Percent of total assets under normal market conditions
x/ No policy limitation on usage
- Not permitted
+ For temporary defensive purposes may constitute 100 percent of
total assets

BANKERS' ACCEPTANCES. Bills of exchange or time 25 __ 35+ 35+ 35+
drafts drawn on and accepted by a commercial bank.
Credit risk.

BORROWINGS.(1) The borrowing of money from banks or 33 1/3 33 1/3 33 1/3 33 1/3 33 1/3
through reverse repurchase agreements. Leverage and
credit risks.

CERTIFICATES OF DEPOSIT. Negotiable instruments with a x/ __ 35+ 35+ 35+
stated maturity. Credit and liquidity risks.
</TABLE>

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<PAGE> 51

PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----

<S> <C> <C> <C> <C> <C>
COMMERCIAL BONDS. Debt securities issued by x/ __ x/ x/ 35
corporations. Credit and interest rate risk.

COMMERCIAL PAPER AND OTHER SHORT-TERM x/ __ 35+ 35+ 35+
OBLIGATIONS. Short-term promissory notes or other
obligations issued by corporations and other entities.
Credit risk.

COMMON STOCK. Shares of ownership of a company. __ __ __ x/ x/
Market risk.

CONVERTIBLE SECURITIES. Bonds or preferred stock that __ __ x/ x/ x/
convert to common stock. Credit, interest rate and
market risks.

CORPORATE BONDS. Debt securities issued by x/ __ x/ x/ 35
corporations. Credit and interest rate risks.
EMERGING MARKET SECURITIES. Securities of countries __ __ __ 15 __
with emerging economies or securities markets.

Currency, information, liquidity, market and political
risks.

FOREIGN SECURITIES.

o Stocks and bonds of foreign issuers __ __ 35 x/ 35

o American depository receipts, European x/ __ __ x/ 35
depository receipts, global depository receipts
and other similar global instruments

Currency, liquidity, information, market, natural event
and political risks.

FORWARD COMMITMENTS. The purchase or sale of a x/ x/ x/ x/ x/
security with payment and delivery scheduled for a
future time. Leverage, market and opportunity risks.

ILLIQUID SECURITIES.(3) Securities which may be difficult 10 __ 15 15 15
to sell at an acceptable price. Liquidity, market and
valuation risks.
</TABLE>

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<PAGE> 52

PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----

<S> <C> <C> <C> <C> <C>
INVESTMENT COMPANY SECURITIES. Shares of other
mutual funds. SBCL and BISYS Fund Services, Inc.
will reduce certain fees when investing in funds for
which it serves as investment and adviser or
administrator. (Investments in any one fund will not
exceed 5% of total assets. Investments in all funds will
not exceed 10% of total assets.)

o Money market mutual funds 10 10 10 10 10

o Non-money market mutual funds __ __ __ 10 __

Management and market risks.

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<PAGE> 53

PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
PREFERRED STOCK. A class of stock that generally pays a __ __ 30 x/ x/
dividend at a specified rate and has preference over
common stock in the payment of dividends and
liquidation. Market risk.

REPURCHASE AGREEMENTS.(1) The purchase of a security x/ x/ x/ x/ x/
and the simultaneous commitment to sell it back at an
agreed upon price. Credit, market and leverage risks.

REVERSE REPURCHASE AGREEMENTS.(1, 4) The sale of a x/ x/ x/ x/ x/
security and the simultaneous commitment to buy it
back at an agreed upon price. Credit, leverage and
market risks.

RESTRICTED SECURITIES.(5) Securities not registered under 10 __ x/ x/ x/
the Securities Act of 1933. Market and valuation risks.

RIGHTS AND WARRANTS. A contract issued by a corporation __ __ x/ x/ x/
enabling the owner to subscribe to and purchase a
specified number of shares of the corporation at a specified
price during a specified period of time. Market and valuation
risks.

SECURITIES LENDING.(1) The lending of securities to 33 1/3 33 1/3 33 1/3 33 1/3 33 1/3
financial institutions, which provide cash or government
securities as collateral. Credit risk.

SHORT-TERM TRADING. The sale of a security soon after __ __ x/ x/ x/
its purchase. A portfolio engaging in such trading will
have higher turnover and transaction expenses. Market
risk.

TIME DEPOSITS. Non-negotiable receipts issued by a x/ __ 35+ 35+ 35+
bank in exchange for the deposit of funds. Liquidity
risk.

U.S. GOVERNMENT SECURITIES. Short-term debt x/ x/ x/ x/ 35+
instruments issued or guaranteed by the U.S. Treasury
or by an agency or instrumentalities of the U.S.
government. Credit risk.
</TABLE>

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<PAGE> 54

PRIME U.S. INVESTMENT GLOBAL
MONEY TREASURY GRADE ASSET
MARKET OBLIGATIONS BOND ALLOCATION EQUITY
FUND FUND FUND FUND FUND
---- ---- ---- ---- ----

<S> <C> <C> <C> <C> <C>
VARIABLE AND FLOATING RATE INSTRUMENTS. Obligations x/ x/ x/ x/ __
with a yield that is reset on a periodic basis and loosely
correlated to changes in money market interest rates,
including variable and floating rate notes and bonds.
Credit, interest rate and liquidity risks.

WHEN-ISSUED OR DELAYED-DELIVERY SECURITIES. The x/ x/ x/ x/ x/
purchase or sale of securities for delivery at a future
date. Leverage, market and opportunity risks.
</TABLE>

1 Each Fund has a fundamental investment policy regarding these
practices or securities, as set forth in the Statement of Additional
Information, which may in some cases be less restrictive than the operating
policy set forth in the chart.

2 The Money Market Funds may invest in these securities only if
consistent with their objectives and Rule 2a-7.

3 Each Fund's liquidity limit is calculated as a percentage of its net
assets.

4 Reverse repurchase agreements would also be subject to a Fund's
policy on borrowings.

5 Relative to other securities, these securities are more likely to be
deemed illiquid and, therefore, may be subject to the restrictions on illiquid
securities.

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<PAGE> 55

TYPES OF INVESTMENT RISK

CREDIT RISK. The risk that the issuer of a security, or the counterparty to a
contract, will default or otherwise become unable to honor a financial
obligation.

INFORMATION RISK. The risk that key information about a security or market is
inaccurate or unavailable.

LEVERAGE RISK. Associated with securities or practices (such as borrowing) that
multiply small index or market movements into large changes in value.

MANAGEMENT RISK. The risk that a strategy used by a fund's management may fail
to produce the intended result. This risk is common to all mutual funds.

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<PAGE> 56

NATURAL EVENT RISK. The risk of losses attributable to natural disasters, crop
failures and similar events.

OPPORTUNITY RISK. The risk of foregoing an investment opportunity because the
assets necessary to take advantage of it are tied up in less advantageous
investments.

VALUATION RISK. The risk that a fund has valued certain of its securities at a
higher price than it can sell them for.

PORTFOLIO TURNOVER

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<PAGE> 57

INVESTMENT RESTRICTIONS

VALUATION OF SHARES

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<PAGE> 58

For further information about the valuation of investments, see the
Statement of Additional Information.

HOW TO PURCHASE AND REDEEM SHARES

DISTRIBUTOR

Shares are sold on a continuous basis by the Group's Distributor, BISYS
Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio 43219. If you wish to
purchase Shares, contact the Group at (800) XXX-XXXX.

PURCHASES OF CLASS A SHARES

Class A Shares may be purchased through procedures established by the
Distributor in connection with the requirements of qualified accounts maintained
by or on behalf of certain persons ("Customers") by Participating Organizations,
including brokers and dealers, under the Group's Distribution and Shareholder
Services Plan. See "MANAGEMENT OF SANWA MUTUAL FUNDS GROUP--Distribution Plan."

Shares of the Group sold to Participating Organizations acting in a
fiduciary, advisory, custodial (other than individual retirement accounts), or
other similar capacity on behalf of Customers will normally be held of record by
the Participating Organizations. With respect to Shares so sold, it is the
responsibility of the Participating Organization to transmit purchase or
redemption orders to the Distributor and to deliver federal funds for purchase
on a timely basis.

Investors may directly purchase Class A Shares of a Fund by completing
and signing an Account Registration Form and mailing it, together with a check
(or other negotiable bank draft or money order) for at least the minimum initial
purchase amount, payable to Sanwa Mutual Funds Group, P.O. Box XXXXXX, Columbus,
Ohio XXXXX-XXXX. Investors may obtain an Account Registration Form and
additional information regarding the Group by

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<PAGE> 59

contacting their local Sanwa Bank California office or calling (800) XXX-XXXX.
Subsequent purchases of Class A Shares of a Fund may be made at any time by
mailing a check (or other negotiable bank draft or money order) to the above
address.

If an Account Registration Form has been previously received by the
Distributor, investors may also purchase Class A Shares by telephone. Telephone
orders may be placed by calling the Group at (800) XXX-XXXX. Payment for Class A
Shares ordered by telephone may be made by sending funds electronically to the
Group's custodian. To make payments electronically, investors must call the
Group at (800) XXX-XXXX to obtain instructions regarding the bank account number
into which the funds should be wired and other pertinent information.

Class A Shares of the Investment Grade Bond Fund, the Global Asset
Allocation Fund and the Equity Fund are sold at the net asset value next
determined after receipt by the Distributor of an order in good form to purchase
Shares (see "VALUATION OF SHARES"). In the case of orders for the purchase of
Shares placed through a broker-dealer, the public offering price will be the net
asset value as so determined, but only if the broker-dealer receives the order
prior to the Valuation Time for that day and transmits to the Group by the
Valuation Time. The broker-dealer is responsible for transmitting such orders
promptly. If the broker-dealer fails to do so, the investor's right to that
day's closing price must be settled between the investor and the broker-dealer.
If the broker-dealer receives the order after the Valuation Time for that day,
the price will be based on the net asset value determined as of the Valuation
Time for the next Business Day.

There is a minimum initial investment of $1,000 for the purchase of
Class A Shares of a Fund, and a $50 minimum initial investment for subsequent
purchases. The minimum initial investment amount is $50 if purchases are made in
connection with qualified retirement plans, systematic investment plans or
payroll deduction plans. There is no limit on the amount of Class A Shares that
may be purchased.

Shareholders will be mailed a confirmation of each new transaction in
their account. In the case of Class A Shares held of record by a Participating
Organization but beneficially owned by a Customer, confirmations of purchases,
exchanges and redemptions of Class A Shares by a Participating Organization will
be sent to the Customer by the Participating Organization. Certificates
representing Shares will not be issued.

SANWA MUTUAL FUNDS GROUP INDIVIDUAL RETIREMENT ACCOUNT ("IRA")

The Group makes available IRAs, including IRAs set up under a
Simplified Employee Pension Plan ("SEP-IRAs") and IRA "Rollover Accounts." An
IRA enables individuals, even if they participate in an employer-sponsored
retirement plan, to establish their own retirement program by purchasing Class A
Shares for an IRA. Sanwa Mutual Funds Group IRA contributions may be
tax-deductible and earnings are tax deferred. Under the Tax Reform Act

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<PAGE> 60

of 1986, the tax deductibility of IRA contributions is restricted or eliminated
for individuals who participate in certain employer pension plans and whose
annual income exceeds certain limits. Existing IRAs and future contributions up
to the IRA maximums, whether deductible or not, still earn income on a
tax-deferred basis.

All Sanwa Mutual Funds Group IRA distribution requests must be made in
writing to BISYS Fund Services, Inc. (the "Transfer Agent"). Any additional
deposits to a Sanwa Mutual Funds Group IRA must distinguish the type and year of
the contribution.

For more information on a Sanwa Mutual Funds Group IRA call the Group
at (800) XXX-XXXX. Shareholders are advised to consult a tax adviser on Sanwa
Mutual Funds Group IRA contribution and withdrawal requirements and
restrictions. Investors should read the Disclosure Statement and Custodial
Agreement for further details on eligibility, service fees, and tax
implications.

ADDITIONAL INFORMATION ABOUT PURCHASING SHARES

Purchases of Class A Shares of the Funds will be effected only on a
Business Day (as defined in "VALUATION OF SHARES"). An order for a Fund received
prior to a Valuation Time on any Business Day will be executed at the net asset
value determined as of the next Valuation Time on the date of receipt. An order
received after the last Valuation Time on any Business Day will be executed at
the net asset value determined as of the next Valuation Time.

An order to purchase Class A Shares of a Money Market Fund will be
deemed to have been received by the Distributor when federal funds are available
to the Group's custodian for investment. Federal funds are monies credited to a
bank's account within a Federal Reserve Bank. Payment for an order to purchase
Shares of a Money Market Fund which is transmitted by federal funds wire will be
available the same day for investment by the Group's custodian, if received
prior to the last Valuation Time (see "VALUATION OF SHARES"). It is strongly
recommended that investors of substantial amounts use federal funds to purchase
Shares of a Money Market Fund.

The Group reserves the right to reject any order for the purchase of
its Class A Shares in whole or in part, including purchases made with foreign
drafts or checks. The Group will not accept third party checks for investment.

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<PAGE> 61

Please call the Group at (800) XXX-XXXX regarding proper instructions
and information to purchase or redeem Shares by check or wire. Shareholders may
also execute telephone transactions as explained below.

AUTO INVEST PLAN

Sanwa Mutual Funds Group's Auto Invest Plan enables Shareholders to
make regular purchases of Class A Shares through automatic deduction from their
bank accounts. With Shareholder authorization, the Transfer Agent will deduct
the amount specified (subject to the applicable minimums) from the Shareholder's
bank account and will automatically invest that amount in Class A Shares at the
public offering price on the date of such deduction. The required minimum
initial investment when opening an account using the Auto Invest Plan is $50 per
Fund; the minimum amount for subsequent investments in a Fund is $50. To
participate in the Auto Invest Plan, Shareholders should complete the
appropriate section of the Account Registration Form or submit a subsequent
written request to the Transfer Agent. To change the Auto Invest Plan
instructions or to discontinue the feature, a Shareholder request must be made
in writing to the Sanwa Mutual Funds Group, P.O. Box XXXXXX, Columbus, Ohio
XXXXX-XXXX. The Auto Invest Plan may be amended or terminated without notice at
any time by the Distributor.

EXCHANGE PRIVILEGE

Class A Shares of each Fund may be exchanged for Class A Shares of the
other Funds, provided that the Shareholder making the exchange is eligible on
the date of the exchange to purchase Class A Shares (with certain exceptions and
subject to the terms and conditions described in this prospectus). Class A
Shares of each Fund may be exchanged for Trust Shares in instances where the
Shareholder becomes eligible to purchase Trust Shares. Depending upon the terms
of a particular Customer account, a Participating Organization may charge a fee
with regard to such an exchange. Information about such charges will be supplied
by the Participating Organization.

A Shareholder wishing to exchange Class A Shares purchased directly
from the Group may do so by contacting the Group at (800) XXX-XXXX or by
providing instructions to the Transfer Agent. If not selected on the Account
Registration form, the Shareholder will automatically receive exchange
privileges. A Shareholder wishing to exchange Class A Shares purchased through a
Participating Organization or Bank may do so by contacting the Participating
Organization or Bank. If an exchange request in good order is received by the
Distributor or the Transfer Agent by 4:00 p.m. (Eastern time) on any Business
Day, the

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<PAGE> 62

exchange usually will occur on that day. Any Shareholder who wishes to make an
exchange should obtain and review a prospectus describing the Fund and class of
Shares which he or she wishes to acquire before making the exchange. The
exchange privilege may be exercised only in those states where the class of
Shares of such other Fund may legally be sold. The Group reserves the right to
change the terms and conditions of the exchange privilege discussed herein upon
sixty days' written notice.

AUTO EXCHANGE

Sanwa Mutual Funds Group Auto Exchange enables Shareholders to make
regular, automatic withdrawals from Class A Shares of a Money Market Fund and
use those proceeds to benefit from dollar-cost-averaging by automatically making
purchases of shares of another Sanwa Mutual Fund. With shareholder
authorization, the Transfer Agent will withdraw the amount specified (subject to
the applicable minimums) from the Shareholder's Money Market Fund account and
will automatically invest that amount in Class A Shares of the Fund designated
by the Shareholder. In order to participate in the Auto Exchange, Shareholders
must have a minimum initial purchase of $[10,000] in their Money Market Fund
account and maintain a minimum account balance of $1,000.

REDEMPTION OF SHARES

Shareholders may redeem their Class A Shares without charge on any day
that net asset value is calculated (see "VALUATION OF SHARES") and Shares may
ordinarily be redeemed by mail or by telephone. However, all or part of a
Customer's Shares may be required to be redeemed in accordance with instructions
and limitations pertaining to his or her account held by a Participating
Organization or Bank. For example, if a Customer has agreed to maintain a
minimum balance in his or her account, and the balance in that account falls
below that minimum, the Customer may be obliged to redeem, or the Participating

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<PAGE> 63

Organization or Bank may redeem for and on behalf of the Customer, all or part
of the Customer's Shares to the extent necessary to maintain the required
minimum balance.

Each Fund reserves the right to redeem a shareholder's Class A Shares
if the shareholder does not maintain a balance of [$_______] in the Class A
Shares of that Fund. Alternatively, the Fund may charge a shareholder whose
account falls below the minimum a fee of [$_______].

REDEMPTION BY MAIL

A written request for redemption must be received by the Group in order
to constitute a valid tender for redemption. The signature on the written
request must be guaranteed by a bank, broker, dealer, credit union, securities
exchange, securities association, clearing agency or savings association, as
those terms are defined in Rule 17Ad-15 under the Securities Exchange Act of
1934 if (a) a redemption check is to be payable to anyone other than the
Shareholder(s) of record; (b) a redemption check is to be mailed to the
Shareholder(s) at an address other than the address of record or other than to a
commercial bank designated on the Account Registration Form of such
Shareholder(s); or (c) a redemption check is to be mailed to an address that has
not been on the Group's books for sixty days. The Distributor reserves the right
to reject any signature guarantee if (1) it has reason to believe that the
signature is not genuine, (2) it has reason to believe that the transaction
would otherwise be improper, or (3) the guarantor institution is a broker or
dealer that is neither a member of a clearing corporation nor maintains net
capital of at least $100,000. A notary public will not be accepted as a
signature guarantee. Proceeds may be mailed to the address of record or sent
electronically or mailed to a previously designated bank account without a
signature guarantee. See "Redemption by Telephone" for further discussion
regarding sending proceeds to your bank account.

REDEMPTION BY TELEPHONE

Shares may be redeemed by telephone [ONLY] if the Shareholder selected
that option on the Account Registration Form. A Shareholder may have the
proceeds mailed to the address of record or sent electronically or mailed
directly to a domestic commercial bank account previously designated by the
Shareholder on the Account Registration Form. Under most circumstances, such
payments will be transmitted on the next Business Day following receipt of a
valid request for redemption. Such electronic redemption requests may be made by
the Shareholder by telephone to the Transfer Agent. The Transfer Agent will
reduce the amount of a wire redemption payment by its then-current wire
redemption charge. Such charge is presently $[7.00] for each wire redemption.
There is no charge for having payment of redemption requests mailed or sent via
the Automated Clearing House to a designated bank account. For telephone
redemptions, contact SBCL or your Participating Organization.

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<PAGE> 64

TELEPHONE PROCEDURES

CHECK WRITING SERVICE

Shareholders of Class A Shares of a Money Market Fund may write checks
in the amount of $500 or more, against their Fund account. A Shareholder will
receive a supply of checks after a signed signature card is received. A check
may be made payable to any person, and the Shareholder's account will continue
to earn dividends until the check clears. Because of the difficulty of
determining in advance the exact value of a Fund account, a Shareholder may not
use a check to close his account. The Shareholder's account will be charged a
fee for stopping payment of a check upon the Shareholder's request or if the
check cannot be honored because of insufficient funds or other valid reasons.

AUTO WITHDRAWAL PLAN

Sanwa Mutual Funds Group Auto Withdrawal Plan enables Shareholders to
make regular redemptions of Class A Shares of a Fund. With Shareholder
authorization, the Transfer Agent will automatically redeem Class A Shares at
the net asset value of the applicable Fund on the dates of withdrawal and have
the amount specified transferred according to the instructions of the
Shareholder. To participate in the Auto Withdrawal Plan Shareholders must have
at least $5,000 in the Fund selected and must maintain a minimum account balance
of $1,000 in the Fund. Purchase of additional Class A Shares concurrent with
withdrawals may be disadvantageous to certain Shareholders because of tax
liabilities.

To participate in the Auto Withdrawal Plan, Shareholders should
complete the appropriate section of the Account Registration Form or submit a
written request (with a signature guarantee) to the Transfer Agent. For a
Shareholder to change the Auto Withdrawal instructions or to discontinue the
feature, the request must be made in writing to the Sanwa

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<PAGE> 65

Mutual Funds Group, P.O. Box XXXXXX, Columbus, Ohio XXXXX-XXXX. The Auto
Withdrawal Plan may be amended or terminated without notice at any time by the
Distributor.

PAYMENTS TO SHAREHOLDERS

Redemption orders are effected at the net asset value per Share next
determined after the Shares are properly tendered for redemption, as described
above. Payment to Shareholders for Shares redeemed will be made within seven
days after receipt by the Distributor of the request for redemption. However, to
the greatest extent possible, the Group will attempt to honor requests from
Shareholders for next Business Day payments if the request for redemption is
received by the Transfer Agent before the last Valuation Time on a Business Day
or, if the request for redemption is received after the last Valuation Time, to
honor requests for payment within two Business Days, unless it would be
disadvantageous to the Group or the Shareholders of the particular Fund to sell
or liquidate portfolio securities in an amount sufficient to satisfy requests
for payments in that manner. The Money Market Funds will attempt to honor
requests from Shareholders for same day payment upon redemption of Shares if the
request for redemption is received by the Transfer Agent before 4:00 p.m.
Eastern time, on a Business Day or, if the request for redemption is received
after 4:00 p.m. Eastern time, to honor requests for payment on the next Business
Day, unless it would be disadvantageous to the Fund or its Shareholders to sell
or liquidate portfolio securities in an amount sufficient to satisfy requests
for payments in that manner.

Due to the relatively high cost of handling small investments, the
Group reserves the right to redeem, at net asset value, the Shares in an account
with a value of less than $1,000. Accordingly, an investor purchasing Shares of
a Fund in only the minimum investment amount may be subject to such involuntary
redemption if he thereafter redeems some of his Shares. Before the Group
exercises its right to redeem such Shares, the Shareholder will be given notice
that the value of his Shares of a Fund is less than the minimum amount and will
be allowed 60 days to make an additional investment to increase the value of the
account to at least $1,000.

See "ADDITIONAL PURCHASE AND REDEMPTION INFORMATION" in the Statement
of Additional Information for examples of when the Group may suspend the right
of

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<PAGE> 66

redemption or redeem Shares involuntarily if it appears appropriate to do so in
light of the Group's responsibilities under the 1940 Act.

DIVIDENDS AND TAXES

Shareholders will be advised at least annually as to the amount and
federal income tax character of distributions made during the year.

The amount of dividends payable with respect to the Trust Shares will
exceed dividends on Class A Shares due to the Distribution and Shareholder
Services Plan fee applicable to Class A Shares.

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<PAGE> 67

or any revocation thereof, must be made in writing to the Sanwa Mutual Funds
Group, P.O. Box XXXXXX, Columbus, Ohio XXXXX-XXXX, and will become effective
with respect to dividends and distributions having record dates after its
receipt by the Transfer Agent. Reinvested dividends receive the same tax
treatment as dividends paid in cash. Dividends are paid in cash not later than
seven Business Days after a Shareholder's complete redemption of his or her
Shares. If you elect to receive distributions in cash, and checks (1) are
returned and marked as "undeliverable" or (2) remain uncashed for six months,
your cash election will be changed automatically and your future dividend and
capital gains distributions will be reinvested in the Fund at the per share net
asset value determined as of the date of payment of the distribution. In
addition, any undeliverable checks or checks that remain uncashed for six months
will be cancelled and will be reinvested in the Fund at the per share net asset
value determined as of the date of cancellation.

Dividends will generally be taxable to a Shareholder as ordinary income
to the extent of the Shareholder's ratable share of the earnings and profits of
a Fund as determined for tax purposes. Certain dividends paid by the Investment
Grade Bond Fund, the Global Asset Allocation Fund, and the Equity Fund, and
so-designated by the Funds may qualify for the dividends received deduction for
corporate shareholders. Because all of the net investment income of the
remaining Funds is expected to be interest income, it is anticipated that no
distributions from such Funds will qualify for the dividends received deduction.
Distributions of net realized capital gains are taxable to Shareholders as
long-term capital gains regardless of how long the Shareholder has held Shares
in the Fund. Shareholders who are not subject to tax on their income generally
will not have to pay federal income tax on amounts distributed to them.

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<PAGE> 68

TAX CONSIDERATIONS RELATING TO THE
GLOBAL ASSET ALLOCATION FUND

MANAGEMENT OF SANWA MUTUAL FUNDS GROUP

TRUSTEES OF THE GROUP

INVESTMENT ADVISER

SBCL serves as Investment Adviser of each Fund. SBCL is a wholly-owned
subsidiary of The Sanwa Bank, Limited, of Japan. Its principal offices are
located at 601 South Figueroa Street, Los Angeles, California 90017.

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<PAGE> 69

Established in 1972, SBCL provides a full range of personal and
business banking services through a network of more than 100 branches and
offices statewide. As of ___________, 1997, SBCL had nearly [__________] of
assets under management.

The Funds are managed by a committee of portfolio managers, assistant
portfolio managers and analysts employed and supervised by SBCL. All investment
decisions are made by the committee and no single person is primarily
responsible for making recommendations to the committee. The committee meets
regularly to review portfolio holdings and to discuss purchase and sale
activity. The committee adjusts holdings in the portfolio as it deems
appropriate in pursuit of the fund's investment objectives. Individual portfolio
managers may also adjust portfolio holdings of each Fund as necessary between
team meetings.

ADMINISTRATOR AND DISTRIBUTOR

BISYS Fund Services, Inc. is the administrator for each Fund and also
acts as the Group's principal underwriter and distributor (the "Administrator"
or the "Distributor") under agreements approved by the Group's Board of
Trustees. BISYS Fund Services, Inc. is wholly owned by The BISYS Group, Inc.,
150 Clove Road, Little Falls, New Jersey 07424, a publicly owned company engaged
in information processing, loan servicing and 401(k) administration and
recordkeeping services to and through banking and other financial organizations.

The Administrator generally assists in all aspects of a Fund's
administration and operation. Under a management and administration agreement
between the Group and the

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<PAGE> 70

Administrator, the fee payable by a Fund to the Administrator for management
administration services is the lesser of (a) a fee computed at the annual rate
of twenty one-hundredths of one percent (0.20%) of a Fund's average daily net
assets or (b) such fee as may from time to time be agreed upon by the Group and
the Administrator. A fee agreed to from time to time by the Group and the
Administrator may be significantly lower than the fee calculated at the annual
rate and the effect of such agreed upon lower fee would be to lower a Fund's
expenses and increase the net income of the Fund during the period when such
agreed upon lower fee is in effect.

EXPENSES

DISTRIBUTION PLAN

The Group's Class A Shares are sold on a continuous basis by the
Distributor. Under the "Distribution Plan," a Fund will pay a monthly
distribution fee to the Distributor as compensation for its services in
connection with the Distribution Plan at an annual rate equal to twenty-five
one-hundredths of one percent (.25%) of the average daily net assets of Class A
Shares of each Fund. The Distributor may periodically waive all or a portion of
the fee with respect to a Fund in order to increase the net investment income of
the Fund available for distribution as dividends. The Distributor may use the
distribution fee to provide distribution

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<PAGE> 71

assistance with respect to a Fund's Class A Shares or to provide shareholder
services to the holders of such Shares. The Distributor may also use the
distribution fee (i) to pay financial institutions and intermediaries (such as
insurance companies and investment counselors but not including banks),
broker-dealers, and the Distributor's affiliates and subsidiaries compensation
for services or reimbursement of expenses incurred in connection with
distribution assistance or (ii) to pay banks, other financial institutions and
intermediaries, broker-dealers, and the Distributor's affiliates and
subsidiaries compensation for services or reimbursement of expenses incurred in
connection with the provision of shareholder services. All payments by the
Distributor for distribution assistance or shareholder services under the
Distribution Plan will be made pursuant to an agreement (a "Servicing
Agreement") between the Distributor and such bank, other financial institution
or intermediary, broker-dealer, or affiliate or subsidiary of the Distributor
("Participating Organizations"). A Servicing Agreement will relate to the
provision of distribution assistance in connection with the distribution of a
Fund's Class A Shares to the Participating Organization's customers on whose
behalf the investment in such Shares is made and/or to the provision of
shareholder services to the Participating Organization's customers owning a
Fund's Class A Shares. Under the Distribution Plan, a Participating Organization
may include SBCL or a subsidiary bank or nonbank affiliates, or the subsidiaries
or affiliates of those banks. A Servicing Agreement entered into with a bank (or
any of its subsidiaries or affiliates) will contain a representation that the
bank (or subsidiary or affiliate) believes that it possesses the legal authority
to perform the services contemplated by the Servicing Agreement without
violation of applicable banking laws (including the Glass-Steagall Act) and
regulations.

The distribution fee will be payable without regard to whether the
amount of the fee is more or less than the actual expenses incurred in a
particular year by the Distributor in connection with distribution assistance or
shareholder services rendered pursuant to the Servicing Agreements entered into
under the Distribution Plan. If the amount of the distribution fee is greater
than the Distributor's actual expenses incurred in a particular year (and the
Distributor does not waive that portion of the distribution fee), the
Distributor will realize a profit in that year from the distribution fee. If the
amount of the distribution fee is less than the Distributor's actual expenses
incurred in a particular year, the Distributor will realize a loss in that year
under the Distribution Plan and will not recover from a Fund the excess of
expenses for the year over the distribution fee, unless actual expenses incurred
in a later year in which the Distribution Plan remains in effect were less than
the distribution fee paid in that later year.

The Distribution Plan also contains a so-called "defensive" provision
applicable to all classes of Shares. Under this defensive provision to the
extent that any payment made to the Administrator, including payment of
administration fees, should be deemed to be indirect financing of any activity
primarily intended to result in the sale of Shares issued by the Group's Funds
within the context of Rule 12b-1 under the 1940 Act, such payment shall be
deemed to be authorized by the Distribution Plan.

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<PAGE> 72

BANKING LAWS

GENERAL INFORMATION

DESCRIPTION OF THE GROUP AND ITS SHARES

-32-

<PAGE> 73

than 50% of the votes attributable to the Shareholders of record of the Group or
such Fund are represented in person or by proxy, or (b) the holders of more than
50% of the outstanding votes of Shareholders of the Group or such Fund.

CUSTODIAN, TRANSFER AGENT AND FUND ACCOUNTANT

__________________, serves as Custodian for the Group.

BISYS Fund Services, Inc. serves as transfer agent for and provides
fund accounting services to the Group.

OTHER CLASSES OF SHARES

In addition to Class A Shares, the Group also offers Trust Shares of
each Fund. Trust Shares are offered to Sanwa Bank California and its affiliates
and other financial service providers approved by the Distributor for the
investment of funds for which they act in a fiduciary, advisory, agency,
custodial (other than for individual retirement accounts), or similar capacity.
Trust Shares are sold at net asset value and are not subject to a sales charge
or a Distribution Plan fee. A salesperson or other person entitled to receive
compensation for selling or servicing the shares may receive different
compensation with respect to one particular class of shares over another in the
Fund. For further details regarding eligibility requirements for the purchase of
Trust Shares, contact your Sanwa Bank California representative.

PERFORMANCE INFORMATION

GENERAL. From time to time, a Money Market Fund's annualized "yield"
and "effective yield" and total return for Class A Shares may be presented in
advertisements, sales literature

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<PAGE> 74

and shareholder reports. The "yield" of a Money Market Fund is based upon the
income earned by the Fund over a seven-day period and then annualized, i.e. the
income earned in the period is assumed to be earned every seven days over a
52-week period and is stated as a percentage of the investment. The "effective
yield" of a Money Market Fund is calculated similarly but when annualized, the
income earned by the investment is assumed to be reinvested in Shares of the
Group and thus compounded in the course of a 52-week period. The effective yield
will be higher than the yield because of the compounding effect of the assumed
reinvestment.

From time to time performance information of the Investment Grade Bond
Fund, the Global Asset Allocation Fund and the Equity Fund showing its average
annual total return, aggregate total return, and/or yield may be presented in
advertisements, sales literature and shareholder reports. Such performance
figures are based on historical earnings and are not intended to indicate future
performance. Average annual total return will be calculated for the period since
the establishment of a Fund. Average annual total return is measured by
comparing the value of an investment in a Fund at the beginning of the relevant
period to the redemption value of an investment at the end of the period
(assuming immediate reinvestment of any dividends or capital gains
distributions) and annualizing the result. Aggregate total return is calculated
similarly to average annual total return except that the return figure is
aggregated over the relevant period instead of annualized. Yield will be
computed by dividing the net investment income per Share for the Investment
Grade Bond Fund, the Global Asset Allocation Fund and the Equity Fund earned
during a recent 30-day period by that Fund's per Share maximum offering price
(reduced by any undeclared earned income expected to be paid shortly as a
dividend) on the last day of the period and annualizing the results.

Each Fund may also present its average annual total return, aggregate
total return, and yield, as the case may be.

The Investment Grade Bond Fund, the Global Asset Allocation Fund and
the Equity Fund may also calculate a distribution rate. Distribution rates will
be computed by dividing the distribution per Share of a class made by a Fund
over a twelve-month period by the maximum offering price per Share. The
distribution rate includes both income and capital gain dividends and does not
reflect unrealized gains or losses. The calculation of income in the
distribution rate includes both income and capital gain dividends and does not
reflect unrealized gains or losses, although a Fund may also present a
distribution rate excluding the

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<PAGE> 75

effect of capital gains. The distribution rate differs from the yield, because
it includes capital items which are often non-recurring in nature, and may
include returns of principal, whereas yield does not include such items. The
Funds do not intend to publish distribution rates in Fund advertisements but may
publish such rates in supplemental sales literature.

Further information about the performance of a Fund is contained in
that Fund's annual report to Shareholders, which may be obtained without charge
by calling (800) XXX-XXXX.

PAST PERFORMANCE. Each of the Prime Money Market Fund, the Investment
Grade Bond Fund, and the Equity Fund commenced operations on October , 1997
subsequent to the transfer of assets by a common or collective trust fund (a
"Portfolio") to a Fund in exchange for shares of that Fund (the "Transfer").
Each Fund's portfolio of investments on October , 1997 was the same as a
Portfolio's immediately prior to the Transfer. The Portfolios that transferred
assets to each Fund are:

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<PAGE> 76

AVERAGE ANNUAL TOTAL RETURN
AS OF JUNE 30, 1997
<TABLE>
<CAPTION>
Common/Collective Portfolio 1 year 3 years 5 years 10 years
- --------------------------- ------ ------- ------- --------

<S> <C> <C> <C> <C>
[A] Portfolio(1) 4.81% 4.86% 4.10% 5.63%
[B] Portfolio 6.58% 2.20%(2) N/A N/A
[C] Portfolio 32.29% 26.67% 24.57%(3) N/A
</TABLE>

(1) The 7-day, 7-day effective yield and 30-day yield for the Prime Money
Market Fund's predecessor, [A] Portfolio, as of June 30, 1997 were 4.87%,
4.99% and 4.86%, respectively.

(2) Since the date that the Investment Grade Bond Fund's predecessor's
investment objective and policies were amended to be consistent with those
of the Investment Grade Bond Fund: January 31, 1996.

(3) Since the date that the Equity Fund's predecessor's investment objective
and policies were amended to be consistent with those of the Equity Fund:
March 31, 1994.

The above-quoted performance data includes the performance of each
Portfolio for the period before the Funds commenced operations adjusted to
reflect the deduction of fees and expenses applicable to the Class A Shares of
each Fund (i.e., adjusted to reflect anticipated expenses, net of management and
administrative fee waivers). The Portfolios were not registered under the 1940
Act and therefore were not subject to certain investment restrictions imposed by
the 1940 Act. If a Portfolio had been registered under the 1940 Act, its
performance may have been adversely affected.

MISCELLANEOUS

Shareholders will receive unaudited semi-annual reports describing the
investment operations their Fund(s) and annual financial statements audited by
independent public accountants.

Inquiries regarding the Group may be directed in writing to the Group
at the following address: the Sanwa Mutual Funds Group, P.O. Box XXXXXX,
Columbus, Ohio XXXXX- XXXX or by calling toll free (800) XXX-XXXX.

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<PAGE> 77

INVESTMENT ADVISER
Sanwa Bank California
Investment Management Department
601 S. Figueroa Street
Los Angeles, California 90017

ADMINISTRATOR AND DISTRIBUTOR
BISYS Fund Services, Inc.
3435 Stelzer Road
Columbus, Ohio 43219

LEGAL COUNSEL
Ropes & Gray
One Franklin Square
1301 K Street, N.W.
Suite 800 East
Washington, DC 20005

TRANSFER AGENT
BISYS Fund Services, Inc.
3435 Stelzer Road
Columbus, Ohio 43219

AUDITORS
Ernst & Young

CUSTODIAN
XXXXXXX

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<PAGE> 78
CROSS REFERENCE SHEET
---------------------

SANWA MUTUAL FUNDS GROUP
------------------------
STATEMENT OF ADDITIONAL INFORMATION
-----------------------------------
<TABLE>
<CAPTION>
Statement of Additional
Part B Item Information Caption
- ----------- ------------------------
<S> <C>
Cover Page Cover Page

Table of Contents Table of Contents

General Information and History Additional Information -
Organization and Description of
Shares

Investment Objective and Policies Investment Objective and Policies

Management of the Sanwa Mutual Fund Group Management of Sanwa Mutual
Funds Group
Control Persons and Principal
Holders of Securities Miscellaneous

Investment Advisory and Other Services Management of Sanwa Mutual
Funds Group

Brokerage Allocation and Other Practices Management of the Sanwa Mutual
Funds Group

Capital Stock and Other Securities Valuation; Additional Purchase
and Redemption Information;
Management of Sanwa Mutual
Funds Group; Additional
Information
Purchase, Redemption and Pricing
of Securities Being Offered Valuation; Additional Purchase
and Redemption Information;
Management of Sanwa Mutual
Funds Group

Tax Status Additional Tax Information
</TABLE>

<PAGE> 79

Underwriters Management of Sanwa Mutual
Funds Group

Calculation of Performance Data Performance Information

Financial Statements Not Applicable

-2-

<PAGE> 80

----------------

SANWA MUTUAL FUNDS GROUP

STATEMENT OF ADDITIONAL INFORMATION

[____________, 1997]

----------------

This Statement of Additional Information is not a Prospectus, but should be read
in conjunction with the Prospectuses of the Sanwa Prime Money Market Fund, the
Sanwa U.S. Treasury Obligations Fund, the Sanwa Investment Grade Bond Fund, the
Sanwa Global Asset Allocation Fund, and the Sanwa Equity Fund which are dated
[_____________]. This Statement of Additional Information is incorporated by
reference in its entirety into the Prospectuses. Copies of the Prospectuses may
be obtained by writing Sanwa Mutual Funds Group at XXXXX, Columbus, Ohio XXXXX,
or by telephoning toll free (800) XXX-XXXX.

<PAGE> 81

TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
SANWA MUTUAL FUNDS GROUP........................................................................................B-1

INVESTMENT OBJECTIVE AND POLICIES...............................................................................B-1
Additional Information on Portfolio Instruments.............................................................B-1
Investment Restrictions....................................................................................B-19
Additional Information Regarding Fundamental Investment Restrictions.......................................B-19
Portfolio Turnover.........................................................................................B-21

VALUATION......................................................................................................B-22
Valuation of the Money Market Funds........................................................................B-22
Valuation of the Investment Grade Bond Fund, the Global Asset Allocation Fund and the
Equity Fund.......................................................................................B-23
Valuation of International Securities......................................................................B-24

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION.................................................................B-24
Matters Affecting Redemption...............................................................................B-25

ADDITIONAL TAX INFORMATION.....................................................................................B-25
General ..................................................................................................B-25
Additional Tax Information Concerning the Global Asset Allocation Fund.....................................B-27

MANAGEMENT OF SANWA MUTUAL FUNDS GROUP.........................................................................B-29
Trustees and Officers......................................................................................B-29
Investment Adviser.........................................................................................B-29
Portfolio Transactions.....................................................................................B-30
Glass-Steagall Act.........................................................................................B-31
Administrator..............................................................................................B-32
Distributor................................................................................................B-33
Custodian..................................................................................................B-34
Transfer Agent and Fund Accounting Services................................................................B-34
Independent Accountants....................................................................................B-34
Legal Counsel..............................................................................................B-34

PERFORMANCE INFORMATION........................................................................................B-34
Yields of the Money Market Funds...........................................................................B-34
Yields of the Variable NAV Funds...........................................................................B-35
Calculation of Total Return................................................................................B-36
Performance Comparisons....................................................................................B-36

ADDITIONAL INFORMATION.........................................................................................B-37
</TABLE>

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<PAGE> 82

<TABLE>
<S> <C>
Organization and Description of Shares.....................................................................B-37
Shareholder and Trustee Liability..........................................................................B-38
Miscellaneous..............................................................................................B-39

APPENDIX.......................................................................................................B-41
</TABLE>

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<PAGE> 83

STATEMENT OF ADDITIONAL INFORMATION

SANWA MUTUAL FUNDS GROUP

Sanwa Mutual Funds Group (the "Group") is an open-end management
investment company. The Group consists of five series of units of beneficial
interest ("Shares") offered to the public, each representing interests in one of
five separate investment portfolios: the Sanwa U.S. Treasury Obligations Fund
(the "U.S. Treasury Obligations Fund"), the Sanwa Prime Money Market Fund (the
"Prime Money Market Fund" and together with the U.S. Treasury Obligations Fund,
the "Money Market Funds"), the Sanwa Investment Grade Bond Fund (the "Investment
Grade Bond Fund"), the Sanwa Global Asset Allocation Fund (the "Global Asset
Allocation Fund"), and the Sanwa Equity Fund (the "Equity Fund"). Each Fund
offers to the public two classes of Shares: Class A Shares and Trust Shares.
Most information contained in this Statement of Additional Information expands
on subjects discussed in the Prospectuses. Capitalized terms not defined herein
are defined in the Prospectuses. An investment in Shares of a Fund should not be
made without first reading the applicable Prospectuses.

INVESTMENT OBJECTIVE AND POLICIES

ADDITIONAL INFORMATION ON PORTFOLIO INSTRUMENTS

The following policies supplement the information pertaining to
portfolio instruments of each Fund as set forth in the Prospectuses.

The Appendix to this Statement of Additional Information identifies
nationally recognized statistical ratings organizations ("NRSROs") that may be
used by Sanwa Bank California, the Group's investment adviser ("SBCL"), with
regard to portfolio investments for the Funds and provides a description of
relevant ratings assigned by each such NRSRO. A rating by an NRSRO may be used
only where the NRSRO is neither controlling, controlled by, nor under common
control with the issuer of, or any issuer, guarantor, or provider of credit
support for, the instrument.

ASSET-BACKED SECURITIES. Asset-backed securities are secured by company
receivables, home equity loans, truck or auto loans, leases, credit card
receivables and other securities backed by receivables or assets.

Offerings of Certificates for Automobile Receivables ("CARS") are
structured either as flow-through grantor trusts or as pay-through notes. CARS
structured as flow-through instruments represent ownership interests in a fixed
pool of receivables. CARS structured as pay-through notes are debt instruments
supported by the cash flows from the underlying assets. CARS may also be
structured as securities with fixed payment schedules which are

B-1

<PAGE> 84

generally issued in multiple-classes. Cash-flow from the underlying receivables
is directed first to paying interest and then to retiring principal via paying
down the two respective classes of notes sequentially. Cash-flows on
fixed-payment CARS are certain, while cash-flows on other types of CARS issues
depends on the prepayment rate of the underlying automobile loans. Prepayments
of automobile loans are triggered mainly by automobile sales and tradeins. Many
people buy new cars every two or three years, leading to rising prepayment rates
as a pool becomes more seasoned.

Certificates for Amortizing Revolving Debt ("CARDS") represent
participation in a fixed pool of credit card accounts. CARDS pay "interest only"
for a specified period. The CARDS principal balance remains constant during this
period, while any cardholder repayments or new borrowings flow to the issuer's
participation. Once the principal amortization phase begins, the balance
declines with paydowns on the underlying portfolio. Cash flows on CARDS are
certain during the interest-only period. After this initial interest-only
period, the cash flow will depend on how fast cardholders repay their
borrowings. Historically, monthly cardholder repayment rates have been
relatively fast. As a consequence, CARDS amortize rapidly after the end of the
interest-only period. During this amortization period, the principal payments on
CARDS depend specifically on the method for allocating cardholder repayments to
investors. In many cases, the investor's participation is based on the ratio of
the CARDS' balance to the total credit card portfolio balance. This ratio can be
adjusted monthly or can be based on the balances at the beginning of the
amortization period. In some issues, investors are allocated most of the
repayments, regardless of the CARDS' balance. This method results in especially
fast amortization.

Credit support for asset-backed securities may be based on the
underlying assets or provided 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.

BANKERS' ACCEPTANCES AND CERTIFICATES OF DEPOSIT. All of the Funds
except the U.S. Treasury Obligations Fund may invest in bankers' acceptances,
certificates of deposit, and demand and time deposits. Bankers' acceptances are
negotiable drafts or bills of exchange typically drawn by an importer or
exporter to pay for specific merchandise, which are "accepted" by a bank,
meaning, in effect, that the bank unconditionally agrees to pay the face value
of the instrument on maturity. Certificates of deposit are negotiable
certificates issued against funds deposited in a commercial bank or a savings
and loan association for a definite period of time and earning a specified
return.

Bankers' acceptances will be those guaranteed by domestic and foreign
banks, if at the time of investment such banks have capital, surplus, and
undivided profits in excess of $100,000,000 (as of the date of their most
recently published financial statements). Certificates of deposit and demand and
time deposits will be those of domestic and foreign banks and savings and loan
associations, if (a) at the time of investment they have capital,

B-2

<PAGE> 85

surplus, and undivided profits in excess of $100,000,000 (as of the date of
their most recently published financial statements) or (b) the principal amount
of the instrument is insured in full by the Federal Deposit Insurance
Corporation.

COLLATERALIZED MORTGAGE OBLIGATIONS. Collateralized mortgage
obligations ("CMOs") are mortgage-related securities which are structured pools
of mortgage pass-through certificates or mortgage loans. CMOs are issued with a
number of classes or series which have different maturities and which may
represent interests in some or all of the interest or principal on the
underlying collateral or a combination thereof. CMOs of different classes are
generally retired in sequence as the underlying mortgage loans in the mortgage
pool are repaid. In the event of sufficient early prepayments on such mortgages,
the class or series of CMOs first to mature generally will be retired prior to
its maturity. Thus, the early retirement of a particular class or series of CMO
held by a Fund would have the same effect as the prepayment of mortgages
underlying a mortgage-backed pass-through security.

Certain debt securities such as, but not limited to, mortgage-backed
securities, CMOs and asset-backed securities, as well as securities subject to
prepayment of principal prior to the stated maturity date, are expected to be
repaid prior to their stated maturity dates. As a result, the effective maturity
of these securities is expected to be shorter than the stated maturity. For
purposes of calculating a Fund's weighted average portfolio maturity, the
effective maturity of such securities will be used.

CMOs include stripped mortgage securities, which are derivative
multi-class mortgage securities issued by agencies or instrumentalities of the
U.S. government, or by private originators of, or investors in, mortgage loans,
including savings and loan associations, mortgage banks, commercial banks,
investment banks and special purpose subsidiaries of the foregoing. Stripped
mortgage securities are usually structured with two classes that receive
different proportions of the interest and principal distributions on a pool of
mortgage assets. A common type of stripped mortgage security will have one class
receiving all of the interest from the mortgage assets (the interest-only or
"IO" class), while the other class will receive all of the principal (the
principal-only or "PO" class). The yield to maturity on an IO class is extremely
sensitive to the rate of principal payments (including prepayments) on the
related underlying mortgage assets, and a rapid rate of principal payments may
have a material adverse effect on the securities' yield to maturity. Generally,
the market value of the PO class is unusually volatile in response to changes in
interest rates. If the underlying mortgage assets experience greater than
anticipated prepayments of principal, the Fund may fail to fully recoup its
initial investment in these securities even if the security is rated in the
highest rating category.

Although stripped mortgage securities are purchased and sold by
institutional investors through several investment banking firms acting as
brokers or dealers, these securities were only recently developed. As a result,
established trading markets have not fully developed. Stripped mortgage
securities issued or guaranteed by the U.S. government and held by a Fund

B-3

<PAGE> 86

may be considered liquid securities pursuant to guidelines established by the
Group's Board of Trustees.

COMMERCIAL PAPER. Each Fund, except for the U.S. Treasury Obligations
Fund, may invest in commercial paper. Commercial paper consists of unsecured
promissory notes issued by corporations. Commercial paper usually has a maturity
of less than nine months and has a fixed rates of return.

The Prime Money Market Fund, the Investment Grade Bond Fund, and the
Global Asset Allocation Fund may purchase commercial paper designated as
"Section 4(2) paper," a term that includes debt obligations issued in reliance
on the "private placement" exemption from registration afforded by Section 4(2)
of the Securities Act of 1933. Section 4(2) paper is restricted as to
disposition under the Federal securities laws, and is frequently sold (and
resold) to institutional investors through or with the assistance of investment
dealers who make a market in the Section 4(2) paper. Certain transactions in
Section 4(2) paper may qualify for the registration exemption provided in Rule
144A under the Securities Act of 1933.

COMMON AND PREFERRED STOCK. Stocks represent shares of ownership in a
company. Generally, preferred stock has a specified dividend and ranks after
bonds and before common stocks in its claim on income for dividend payments and
on assets should the company be liquidated. After other claims are satisfied,
common stockholders participate in company profits on a pro rata basis; profits
may be paid out in dividends or reinvested in the company to help it grow.
Increases and decreases in earnings are usually reflected in a company's stock
price, so common stocks generally have the greatest appreciation and
depreciation potential of all corporate securities. While most preferred stocks
pay a dividend, the Funds may purchase preferred stock where the issuer has
omitted, or is in danger of omitting, payment of its dividend. Such investments
would be made primarily for their capital appreciation potential.

FOREIGN CURRENCY TRANSACTIONS. The Global Asset Allocation Fund may use
forward foreign currency exchange contracts. Forward foreign currency exchange
contracts involve an obligation to purchase or sell a specified currency at a
future date at a price set at the time of the contract. Forward currency
contracts do not eliminate fluctuations in the values of portfolio securities
but instead allow a Fund to establish a rate of exchange for a future point in
time. The Fund may use forward foreign currency exchange contracts to hedge
against movements in the value of foreign currencies (including the "ECU" used
in the European Community) relative to the U.S. dollar in connection with
specific portfolio transactions or with respect to portfolio positions. The Fund
may enter into forward foreign currency exchange contracts when deemed advisable
by SBCL under two circumstances. First, when entering into a contract for the
purchase or sale of a security, the Fund may enter into a forward foreign
currency exchange contract for the amount of the purchase or sale price to
protect against variations, between the date the security is purchased or sold
and the date on which payment is made or received, in the value of the foreign
currency relative to the U.S. dollar or other foreign currency.

B-4

<PAGE> 87

Second, when SBCL anticipates that a particular foreign currency may
decline relative to the U.S. dollar or other leading currencies, in order to
reduce risk, the Fund may enter into a forward contract to sell, for a fixed
amount, the amount of foreign currency approximating the value of some or all of
the Fund's securities denominated in such foreign currency. With respect to any
forward foreign currency contract, it will not generally be possible to match
precisely the amount covered by the contract and the value of the securities
involved due to the changes in the values of such securities resulting from
market movements between the date the forward contract is entered into and the
date it matures. In addition, while forward contracts may offer protection from
losses resulting from declines in the value of a particular foreign currency,
they also limit potential gains which might result from increases in the value
of such currency. The Fund will also incur costs in connection with forward
foreign currency exchange contracts and conversions of foreign currencies and
U.S. dollars.

A separate account of a Fund consisting of liquid assets equal to the
amount of the Fund's assets that could be required to consummate forward
contracts entered into under the second circumstance, as set forth above, will
be established with the Fund's custodian. For the purpose of determining the
adequacy of the securities in the account, the deposited securities will be
valued at market or fair value. If the market or fair value of such securities
declines, additional cash or securities will be placed in the account daily so
that the value of the account will be equal the amount of such commitments by
the Fund.

FOREIGN INVESTMENT. The Funds, other than the U.S. Treasury Obligations
Fund, may invest in certain obligations or securities of foreign issuers.
Permissible investments include Eurodollar Certificates of Deposit ("ECDs")
which are U.S. dollar denominated certificates of deposit issued by branches of
foreign and domestic banks located outside the United States, Yankee
Certificates of Deposit ("Yankee CDs") which are certificates of deposit issued
by a U.S. branch of a foreign bank, denominated in U.S. dollars and held in the
United States, Eurodollar Time Deposits ("ETD's") which are U.S. dollar
denominated deposits in a foreign branch of a U.S. bank or a foreign bank, and
Canadian Time Deposits ("CTD's") which are U.S. dollar denominated certificates
of deposit issued by Canadian offices of major Canadian banks, Canadian
commercial paper, which is commercial paper issued by a Canadian corporation or
a Canadian counterpart of a U.S. corporation, and European commercial paper,
which is U.S. dollar denominated commercial paper of an issuer located in
Europe. The Funds may invest in foreign commercial paper, including Canadian and
European commercial paper as described above. The Prime Money Market Fund, the
Equity Fund and the Global Asset Allocation Fund may also purchase foreign
equity securities, including ADRs (sponsored and unsponsored), European
Depository Receipts ("EDRs") and Global Depository Receipts ("GDRs").

Investments in securities issued by foreign branches of U.S. banks,
foreign banks, or other foreign issuers, including American Depository Receipts
("ADRs") and securities purchased on foreign securities exchanges, may subject a
Fund to additional investment risks. Such risks include adverse political and
economic developments, possible seizure, currency

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blockage, nationalization or expropriation of foreign investments, less
stringent disclosure requirements, exchange control regulations, non-U.S.
withholding taxes and the adoption of other foreign governmental restrictions.

Additional risks include currency exchange risks, less publicly
available information, the risk that companies may not be subject to the
accounting, auditing and financial reporting standards and requirements of U.S.
companies, the risk that foreign securities markets may have less volume and
therefore may be less liquid and their prices more volatile than U.S.
securities, and the risk that custodian and brokerage costs may be higher.
Foreign issuers of securities or obligations are often subject to accounting
treatment and engage in business practices different from those respecting
domestic issuers of similar securities or obligations. Foreign branches of U.S.
banks and foreign banks may be subject to less stringent reserve requirements
than those applicable to domestic branches of U.S. banks. The Funds will acquire
such securities only when SBCL believes the risks associated with such
investments are minimal.

FUTURES CONTRACTS AND RELATED OPTIONS. The Investment Grade Bond Fund,
the Global Asset Allocation Fund and the Equity Fund (the "Variable NAV Funds")
may invest in futures contracts and options thereon (interest rate futures
contracts or index futures contracts, as applicable). Positions in futures
contracts may be closed out only on an exchange which provides a secondary
market for such futures. However, there can be no assurance that a liquid
secondary market will exist for any particular futures contract at any specific
time. Thus, it may not be possible to close a futures position. In the event of
adverse price movements, a Fund would continue to be required to make daily cash
payments to maintain its required margin. In such situations, if a Fund has
insufficient cash, it may have to sell portfolio securities to meet daily margin
requirements at a time when it may be disadvantageous to do so. In addition, a
Fund may be required to make delivery of the instruments underlying futures
contracts it holds. The inability to close options and futures positions also
could have an adverse impact on a Fund's ability to effectively hedge.

Successful use of futures by the Funds is also subject to SBCL's
ability to correctly predict the direction the market will move. For example, if
a Fund has hedged against the possibility of a decline in the market adversely
affecting securities held by it and securities prices increase instead, a Fund
will lose part or all of the benefit to the increased value of its securities
which it has hedged because it will have approximately equal offsetting losses
in its futures positions. In addition, in some situations, if a Fund has
insufficient cash, it may have to sell securities to meet daily variation margin
requirements. Such sales of securities may be, but will not necessarily be, at
increased prices which reflect the rising market. A Fund may have to sell
securities at a time when it may be disadvantageous to do so.

The risk of loss in trading futures contracts in some strategies can be
substantial, due both to the low margin deposits required, and the extremely
high degree of leverage involved in futures pricing. As a result, a relatively
small price movement in a futures contract may result in immediate and
substantial loss (as well as gain) to the investor. For example, if at the

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time of purchase, 10% of the value of the futures contract is deposited as
margin, a subsequent 10% decrease in the value of the futures contract would
result in a total loss of the margin deposit, before any deduction for the
transaction costs, if the account were then closed out. A 15% decrease would
result in a loss equal to 150% of the original margin deposit, before any
deduction for the transaction costs, if the contract were closed out. Thus, a
purchase or sale of a futures contract may result in losses in excess of the
amount invested in the contract.

Utilization of futures transactions by a Fund involves the risk of loss
by a Fund of margin deposits in the event of bankruptcy of a broker with whom a
Fund has an open position in a futures contract or related option.

Most futures exchanges limit the amount of fluctuation permitted in
futures contract prices during a single trading day. The daily limit establishes
the maximum amount that the price of a futures contract may vary either up or
down from the previous day's settlement price at the end of a trading session.
Once the daily limit has been reached in a particular type of contract, no
trades may be made on that day at a price beyond that limit. The daily limit
governs only price movement, during a particular trading day and therefore does
not limit potential losses, because the limit may prevent the liquidation of
unfavorable positions. Futures contract prices have occasionally moved to the
daily limit for several consecutive trading days with little or no trading,
thereby preventing prompt liquidation of futures positions and subjecting some
futures traders to substantial losses.

The trading of futures contracts is also subject to the risk of trading
halts, suspensions, exchange or clearing house equipment failures, government
intervention, insolvency of a brokerage firm or clearing house or other
disruptions of normal trading activity, which could at times make it difficult
to impossible to liquidate existing positions or to recover excess variation
margin payments.

GUARANTEED INVESTMENT CONTRACTS. Guaranteed investment contracts
("GICs") are issued by highly rated U.S. insurance companies. Under these
contracts, a Fund makes cash contributions to a deposit fund of the insurance
company's general account. The insurance company then credits interest to the
Fund on a monthly basis, which is based on an index (such as the Solomon
Brothers CD Index), but is guaranteed not to be less than a certain minimum
rate.

ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined
by SBCL, under the supervision of the Board of Trustees, to be illiquid.
Securities may be deemed illiquid if the Fund cannot reasonably expect within
seven days to sell the securities for approximately the amount at which the Fund
values such securities. The sale of illiquid securities, if they can be sold at
all, generally will require more time and result in higher brokerage charges or
dealer discounts and other selling expenses than will the sale of liquid
securities such as securities eligible for trading on U.S. securities exchanges
or in over-the-

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counter markets. Moreover, restricted securities, which may be
illiquid, often sell, if at all, at a price lower than similar securities that
are not subject to restrictions on resale.

Illiquid securities include those that are subject to restrictions
contained in the securities laws of other countries. However, securities that
are freely marketable in the country where they are principally traded, but
would not be freely marketable in the United States, will not be considered
illiquid. Where registration is required, the Fund may be obligated to pay all
or part of the registration expenses and a considerable period may elapse
between the time of the decision to sell and the time the Fund may be permitted
to sell a security under an effective registration statement. If, during such a
period, adverse market conditions were to develop, the Fund might obtain a less
favorable price than prevailed when it decided to sell.

Not all restricted securities are illiquid. In recent years a large
institutional market has developed for certain securities that are not
registered under the Securities Act of 1933, including private placements,
repurchase agreements, commercial paper, foreign securities and corporate bonds
and notes. These instruments are often restricted securities because the
securities are sold in transactions not requiring registration. Institutional
investors generally will not seek to sell these instruments to the general
public, but instead will often depend either on an efficient institutional
market in which such unregistered securities can be readily resold or on an
issuer's ability to honor a demand for repayment. Therefore, the fact that there
are contractual or legal restrictions on resale to the general public or certain
institutions is not dispositive of the liquidity of such investments.

INVESTMENT COMPANY SECURITIES. By investing in other investment
companies, a Fund becomes exposed to the risks of that investment company's
portfolio of securities. Securities of other investment companies will be
acquired by the Funds within the limits prescribed by the 1940 Act. As a
shareholder of another investment company, a Fund would bear, along with other
shareholders, its pro rata portion of the other investment company's expenses,
including advisory fees. These expenses would be in addition to the advisory
fees and other expenses the Fund bear directly in connection with its own
operations.

INVESTMENT GRADE DEBT OBLIGATIONS. The Variable NAV Funds may invest in
"investment grade securities," which are securities rated in the four highest
rating categories of an NRSRO. It should be noted that debt obligations rated in
the lowest of the top four ratings (i.e., "Baa" by Moody's) are considered to
have some speculative characteristics and are more sensitive to economic change
than higher rated securities.

MUNICIPAL OBLIGATIONS. Municipal securities are debt securities issued
by a state, its political subdivisions, agencies, authorities and corporations.
Municipal securities include debt obligations issued to obtain funds for various
public purposes, including the construction of a wide range of public facilities
such as airports, bridges, highways, housing, hospitals, mass transportation,
public utilities, schools, streets, and water and sewer works. Other

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public purposes for which Municipal securities may be issued include refunding
outstanding obligations, obtaining funds for general operating expenses and
obtaining funds to loan to other public institutions and facilities.

Municipal securities include securities issued to finance various
private activities, including certain types of private activity bonds
("industrial development bonds" under prior law). These securities may be issued
by or on behalf of public authorities to obtain funds to provide certain
privately owned or operated facilities.

Municipal securities are generally classified as "general obligation"
or "revenue." General obligation securities are secured by the issuer's pledge
of its full credit and taxing power for the payment of principal and interest.
Revenue securities are payable only from the revenues derived from a particular
facility or class of facilities or, in some cases, from the proceeds of a
special excise or other specific revenue source. Private activity bonds and
industrial development bonds that are municipal securities are in most cases
revenue bonds and generally do not constitute the pledge of the credit of the
issuer of such bonds.

Municipal notes are instruments issued by or on behalf of governments
and political sub-divisions thereof. Examples include: tax anticipation notes
("TANS"), which are short-term debt instruments issued by a municipality or
state to finance working capital needs of the issuer in anticipation of
receiving taxes on a future date; revenue anticipation notes ("RANS"), which are
short-term debt instruments issued by a municipality or state to provide cash
prior to receipt of expected non-tax revenues from a specific source; bond
anticipation notes ("BANS"), which are short-term debt instruments issued by a
municipality or state that will be paid off with the proceeds of an upcoming
bond issue; and tax revenue anticipation notes ("TRANS"), which are short-term
debt instruments issued by a municipality or state to finance working capital
needs in anticipation of receiving taxes or other revenues. Construction loan
notes are instruments insured by the Federal Housing Administration with
permanent financing by "Fannie Mae" (the Federal National Mortgage Association)
or "Ginnie Mae" (the Government National Mortgage Association) at the end of the
project construction period. Tax-free commercial paper is an unsecured
promissory obligation issued or guaranteed by a municipal issuer.

Taxable municipal securities are municipal securities the interest on
which is not exempt from federal income tax. Taxable municipal securities may
include "private activity bonds" that are issued by or on behalf of states or
political subdivisions thereof to finance privately-owned or operated facilities
for business and manufacturing, housing, sports, and pollution control and to
finance facilities for charitable institutions. The payment of the principal and
interest on private activity bonds is not backed by a pledge of tax revenues,
and is dependent solely on the ability of the facility's user to meet its
financial obligations. Taxable municipal securities also may include remarketed
certificates of participation.

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The federal bankruptcy statutes relating to the adjustments of debts of
political subdivisions and authorities of states of the United States provide
that, in certain circumstances, such subdivisions or authorities may be
authorized to initiate bankruptcy proceedings without prior notice to or consent
of creditors, which proceedings could result in material adverse changes in the
rights of holders of obligations issued by such subdivisions or authorities.

Municipal securities also include participation certificates in a
lease, an installment purchase contract, or a conditional sales contract ("lease
obligations") entered into by a state or political subdivision to finance the
acquisition or construction of equipment, land or facilities. Although lease
obligations are not general obligations of the issuer for which the state or
other governmental body's unlimited taxing power is pledged, certain lease
obligations are backed by a covenant to appropriate money to make the lease
obligation payments. However, under certain lease obligations, the state or
governmental body has no obligation to make these payments in future years
unless money is appropriated on a yearly basis. Although "non-appropriation"
lease obligations are secured by the leased property, disposition of the
property in the event of foreclosure might prove difficult. These securities
represent a relatively new type of financing that is not yet marketable as more
conventional securities. Certain investments in lease obligations may be
illiquid. Under guidelines established by the Board of Trustees, the following
factors will be considered when determining the liquidity of a lease obligation:
(1) the frequency of trades and quotes for the obligation; (2) the number of
dealers willing to purchase or sell the obligation and the number of potential
buyers; (3) the willingness of dealers to undertake to make a market in the
obligation; and (4) the nature of the marketplace trades.

OPTIONS - CALLS AND PUTS.

Calls. The Variable NAV Funds may write (sell) "covered" call options
and purchase options to close out options previously written by it. Such options
must be listed on a National Securities Exchange and issued by the Options
Clearing Corporation. The purpose of writing covered call options is to generate
additional premium income. This premium income will serve to enhance each Fund's
total return and will reduce the effect of any price decline of the security
involved in the option. Covered call options will generally be written on
securities which, in SBCL's opinion, are not expected to make any major price
moves in the near future but which, over the long term, are deemed to be
attractive investments for the Funds.

A call option gives the holder (buyer) the "right to purchase" a
security at a specified price (the exercise price) at any time until a certain
date (the expiration date). So long as the obligation of the writer of a call
option continues, the writer may be assigned an exercise notice by the
broker-dealer through whom such option was sold, requiring the writer to deliver
the underlying security against payment of the exercise price. This obligation
terminates upon the expiration of the call option, or such earlier time at which
the writer effects a closing purchase transaction by repurchasing an option
identical to that previously sold. To secure the writer's obligation to deliver
the underlying security in the case of a call option, a writer is

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required to deposit in escrow the underlying security or other assets in
accordance with the rules of the Options Clearing Corporation. The Funds will
write only covered call options. This means that a Fund will only write a call
option on a security which it already owns. In order to comply with the
requirements of the securities laws in several states, a Fund will not write a
covered call option if, as a result, the aggregate market value of all portfolio
securities covering call options or subject to put options exceeds 25% of the
market value of its net assets.

The Variable NAV Funds will write call options only if they are
"covered" and may buy call options. In the case of a call option on a security,
the option is "covered" if the Fund owns the security underlying the call or has
an absolute and immediate right to acquire that security without additional cash
consideration (or, if additional cash consideration is required, cash or cash
equivalents in such amount as are held in a segregated account by its custodian)
upon conversion or exchange of other securities held by it. For a call option on
an index, the option is covered if the Fund maintains with its custodian cash or
cash equivalents equal to the contract value. A call option is also covered if
the Fund holds a call on the same security or index as the call written where
the exercise price of the call held is (i) equal to or less than the exercise
price of the call written, or (ii) greater than the exercise price of the call
written provided the difference is maintained by the Fund in cash or cash
equivalents in a segregated account with its custodian.

Fund securities on which call options may be written will be purchased
solely on the basis of investment considerations consistent with a Fund's
investment objectives. The writing of covered call options is a conservative
investment technique believed to involve relatively little risk (in contrast to
the writing of naked or uncovered options which the Funds will not do), but
capable of enhancing a Fund's total return. When writing a covered call option,
a Fund, in return for the premium, gives up the opportunity for profit from a
price increase in the underlying security above the exercise price, but retains
the risk of loss should the price of the security decline. Unlike owning
securities not subject to an option, a Fund does not have any control over the
point at which it may be required to sell the underlying securities, because it
may be assigned an exercise notice at any time prior to the expiration of its
obligation as a writer. If a call option which a Fund has written expires, the
Fund will realize a gain in the amount of the premium; however, such gain may be
offset by a decline in the market value of the underlying security during the
option period. If the call option is exercised, a Fund will realize a gain or
loss from the sale of the underlying security. The security covering the call
will be maintained in a segregated account by the Fund's custodian. A Fund does
not consider a security covered by a call to be "pledged" as that term is used
in its policy which limits the pledging or mortgaging of its assets.

The premium received is the market value of an option. The premium a
Fund will receive from writing a call option will reflect, among other things,
the current market price of the underlying security, the relationship of the
exercise price to such market price, the historical price volatility of the
underlying security, and the length of the option period. Once

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the decision to write a call option has been made, SBCL, in determining whether
a particular call option should be written on a particular security, will
consider the reasonableness of the anticipated premium and the likelihood that a
liquid secondary market will exist for the option. The premium received by a
Fund for writing covered call options will be recorded as a liability in a
Fund's statement of assets and liabilities. This liability will be readjusted
daily to the option's current market value, which will be the latest sale price
at the time at which the net asset value per share of a Fund is computed (close
of the New York Stock Exchange (the "NYSE")), or, in the absence of such sale,
the latest asked price (or, with respect to the Global Asset Allocation Fund,
the mean between the last bid and asked prices). The liability will be
extinguished upon expiration of the option, the purchase of an identical option
in the closing transaction, or delivery of the underlying security upon the
exercise of the option.

Closing transactions will be effected in order to realize a profit on
an outstanding call option, to prevent an underlying security from being called,
or to permit the sale of the underlying security. Furthermore, effecting a
closing transaction will permit a Fund to write another call option on the
underlying security with either a different exercise price or expiration date or
both. If a Fund desires to sell a particular security from its portfolio on
which it has written a call option, it will seek to effect a closing transaction
prior to, or concurrently with, the sale of the security. There is, of course,
no assurance that a Fund will be able to effect such closing transactions at a
favorable price. If a Fund cannot enter into such a transaction, it may be
required to hold a security that it might otherwise have sold, in which case it
would continue to be at market risk on the security. This could result in higher
transaction costs. A Fund will pay transaction costs in connection with the
writing of options to close out previously written options. Such transaction
costs are normally higher than those applicable to purchases and sales of
portfolio securities.

Call options written by a Fund will normally have expiration dates of
less than nine months from the date written. The exercise price of the options
may be below, equal to, or above the current market values of the underlying
securities at the time the options are written. From time to time, a Fund may
purchase an underlying security for delivery in accordance with an exercise
notice of a call option assigned to it, rather than delivering such security
from its portfolio. In such cases, additional costs will be incurred.

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

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Puts. A put is a right to sell a specified security (or securities)
within a specified period of time at a specified exercise price. To the extent
consistent with its investment objective, the Variable NAV Funds may buy put
options and write secured put options.

The amount payable to a Fund upon its exercise of a "put" is normally
(i) the Fund's acquisition cost of the securities subject to the put (excluding
any accrued interest which the Fund paid on the acquisition), less any amortized
market premium or plus any amortized market or original issue discount during
the period the Fund owned the securities, plus (ii) all interest accrued on the
securities since the last interest payment date during that period.

These options may relate to particular securities, financial
instruments, foreign currencies, stock or bond indices or the yield differential
between two securities, and may or may not be listed on a securities exchange
and may or may not be issued by the Options Clearing Corporation. Options
trading is a highly specialized activity that entails greater than ordinary
investment risks. In addition, unlisted options are not subject to the
protections afforded purchasers of listed options issued by the Options Clearing
Corporation, which performs the obligations of its members if they default.
Cross hedging is the use of options or forward contracts in one currency to
hedge against fluctuations in the value of securities denominated in a different
currency based on a belief that there is a pattern of correlation between the
two currencies. The Funds intend to enter into puts only with dealers, banks,
and broker-dealers which, in SBCL's opinion, present minimal credit risks.

Risk Factors Relating to Options. There are several risks associated
with transactions in put and call options. For example, there are significant
differences between the securities and options markets that could result in an
imperfect correlation between these markets, causing a given transaction not to
achieve its objectives. In addition, a liquid secondary market for particular
options, whether traded over-the-counter or on a national securities exchange
("Exchange") may be absent for reasons which include the following: there may be
insufficient trading interest in certain options, restrictions may be imposed by
an Exchange on opening transactions or closing transactions or both; trading
halts, suspensions or other restrictions may be imposed with respect to
particular classes or series of options or underlying securities; unusual or
unforeseen circumstances may interrupt normal operations on an Exchange; the
facilities of an Exchange or the Options Clearing Corporation may not at all
times be adequate to handle current trading volume; or one or more Exchanges
could, for economic or other reasons, decide or be compelled at some future date
to discontinue the trading of options (or a particular class or series of
options), in which event the secondary market on that Exchange (or in that class
or series of options) would cease to exist, although outstanding options that
had been issued by the Options Clearing Corporation as a result of trades on
that Exchange would continue to be exercisable in accordance with their terms.
In addition, the success of a hedging strategy based on options transactions may
depend on the ability of SBCL to predict movements in the prices of individual
securities, fluctuations in markets and movements in interest rates.

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REPURCHASE AGREEMENTS. Securities held by each of the Funds may be
subject to repurchase agreements. Under the terms of a repurchase agreement, a
Fund would acquire securities from member banks of the Federal Deposit Insurance
Corporation with capital, surplus, and undivided profits of not less than
$100,000,000 (as of the date of their most recently published financial
statements) and from registered broker-dealers which SBCL deems creditworthy
under guidelines approved by the Board of Trustees, subject to the seller's
agreement to repurchase such securities at a mutually agreed-upon date and
price. The repurchase price would generally equal the price paid by the Fund
plus interest negotiated on the basis of current short-term rates, which may be
more or less than the rate on the underlying portfolio securities. The seller
under a repurchase agreement will be required to maintain the value of
collateral held pursuant to the agreement at not less than the repurchase price
(including accrued interest) and SBCL will monitor the collateral's value to
ensure that it equals or exceeds the repurchase price (including accrued
interest). In addition, securities subject to repurchase agreements will be held
in a segregated account.

If the seller were to default on its repurchase obligation or become
insolvent, a Fund holding such obligation would suffer a loss to the extent that
the proceeds from a sale of the underlying portfolio securities were less than
the repurchase price under the agreement, or to the extent that the disposition
of such securities held by the Fund were delayed pending court action.
Additionally, if the seller should be involved in bankruptcy or insolvency
proceedings, a Fund may incur delay and costs in selling the underlying security
or may suffer a loss of principal and interest if the Fund is treated as an
unsecured creditor and required to return the underlying security to the
seller's estate. Securities subject to repurchase agreements will be held by the
Group's custodian or another qualified custodian or in the Federal
Reserve/Treasury book-entry system. Repurchase agreements are considered to be
loans by a Fund under the Investment Company Act of 1940 (the "1940 Act").

REVERSE REPURCHASE AGREEMENTS. As discussed in the Prospectuses, each
Fund may borrow funds for temporary purposes by entering into reverse repurchase
agreements in accordance with each Fund's investment restrictions. Pursuant to
such agreements, a Fund would sell portfolio securities to financial
institutions such as banks and broker-dealers, and agree to repurchase the
securities at a mutually agreed-upon date and price. Each Fund intends to enter
into reverse repurchase agreements only to avoid otherwise selling securities
during unfavorable market conditions to meet redemptions. At the time a Fund
enters into a reverse repurchase agreement, it will place in a segregated
custodial account liquid assets consistent with the Fund's investment
restrictions having a value equal to the repurchase price (including accrued
interest), and will subsequently monitor the account to ensure that such
equivalent value is maintained. Such assets will include U.S. government
securities or other liquid high quality debt securities or high grade debt
securities. Reverse repurchase agreements involve the risk that the market value
of the securities sold by a Fund may decline below the price at which it is
obligated to repurchase the securities. Reverse repurchase agreements are
considered to be borrowings by a Fund under the 1940 Act.

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RIGHTS OFFERINGS AND WARRANTS TO PURCHASE. The Variable NAV Funds may
participate in rights offerings and may purchase warrants, which are privileges
issued by corporations enabling the owners to subscribe to and purchase a
specified number of shares of the corporation at a specified price during a
specified period of time. Subscription rights normally have a short life span to
expiration. The purchase of rights or warrants involves the risk that the Fund
could lose the purchase value of a right or warrant if the right to subscribe to
additional shares is not exercised prior to the rights' and warrants'
expiration. Also, the purchase of rights and/or warrants involves the risk that
the effective price paid for the right and/or warrant added to the subscription
price of the related security may exceed the value of the subscribed security's
market price such as when there is no movement in the level of the underlying
security. A Fund will not invest more than 5% of its net assets, taken at market
value, in warrants, or more than 2% of its net assets, taken at market value, in
warrants not listed on the New York or American Stock Exchanges. Warrants
acquired by a Fund in units or attached to other securities are not subject to
this restriction.

SECURITIES LENDING. While the lending of securities may subject a Fund
to certain risks, such as delays or the inability to regain the securities in
the event the borrower was to default on its lending agreement or enter into
bankruptcy, the Fund will receive 100% collateral in the form of cash or U.S.
government securities. This collateral will be valued daily by SBCL and should
the market value of the loaned securities increase, the borrower will furnish
additional collateral to the Fund. During the time portfolio securities are on
loan, the borrower will pay the Fund any dividends or interest paid on such
securities. Loans are subject to termination by a Fund or the borrower at any
time. While a Fund will not have the right to vote securities on loan, the Funds
intend to terminate the loan and regain the right to vote if that is considered
important with respect to the investment. The Funds will only enter into loan
arrangements with broker-dealers, banks or other institutions which SBCL has
determined are creditworthy under guidelines established by the Group's Board of
Trustees.

SHORT-TERM TRADING. Short-term trading involves the selling of
securities held for a short time, ranging from several months to less than a
day. The object of such short-term trading is to increase the potential for
capital appreciation and/or income of the Funds in order to take advantage of
what SBCL believes are changes in market, industry or individual company
conditions or outlook. Any such trading would increase the portfolio turnover
rate of the Funds and their transaction costs.

SUPRANATIONAL ORGANIZATIONAL OBLIGATIONS. The Funds, other than the
U.S. Treasury Obligations Fund, may purchase debt securities of supranational
organizations such as the European Coal and Steel Community, the European
Economic Community and the World Bank, which are chartered to promote economic
development.

SWAPS. Swap agreements (a common form of derivatives) are contracts
between parties in which one party agrees to make payments to the other party
based on the change in market value of a specified index or asset. In return,
the other party agrees to make payments to the

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first party based on the return of a different specified index or asset.
Although swap agreements entail the risk that a party will default on its
payment obligations the Funds will minimize this risk by entering into
agreements that mark to market no less frequently than quarterly. Swap
agreements also bear the risk that the Funds will not be able to meet their
obligations to the counterparty. This risk will be mitigated by having the Funds
invest in the specific asset for which they are obligated to pay a return. Swap
agreements may be considered illiquid and therefore subject to a Fund's
limitation on illiquid securities.

U.S. GOVERNMENT OBLIGATIONS. The U.S. Treasury Obligations Fund will
invest exclusively in bills, notes and bonds issued or guaranteed by the U.S.
Treasury or agency obligations which are also supported by the full faith and
credit of the U.S. government. Each of the other Funds may invest in such
obligations and in other obligations issued or guaranteed by the U.S.
government, its agencies and instrumentalities. Such other obligations may
include those which are supported by the full faith and credit of the U.S.
government; others which are supported by the right of the issuer to borrow from
the Treasury; others which are supported by the discretionary authority of the
U.S. government to purchase the agency's obligations; and still others which are
supported only by the credit of the instrumentality. No assurance can be given
that the U.S. government would provide financial support to U.S.
government-sponsored agencies and instrumentalities if it is not obligated to do
so by law. A Fund will invest in the obligations of such agencies and
instrumentalities only when SBCL believes that the credit risk with respect
thereto is minimal.

U.S. GOVERNMENT SECURITIES. U.S. government securities include
obligations issued or guaranteed as to payment of principal and interest by the
full faith and credit of the U.S. government, such as Treasury bills, notes,
bonds and certificates of indebtedness, and obligations issued or guaranteed by
the agencies or instrumentalities of the U.S. government, but not supported by
such full faith and credit. Obligations of certain agencies and
instrumentalities of the U.S. government, such as GNMA and the Export-Import
Bank of the United States, are supported by the full faith and credit of the
U.S. Treasury; others, such as those of FNMA, are supported by the right of the
issuer to borrow from the Treasury; others are supported by the discretionary
authority of the U.S. government to purchase the agency's obligations; still
others, such as those of the Federal Farm Credit Banks, or the Federal Home Loan
Mortgage Corporation, are supported only by the credit of the instrumentality.
No assurance can be given that the U.S. government would provide financial
support to U.S. government-sponsored agencies or instrumentalities if it is not
obligated to do so by law.

U.S. government securities may include mortgage-backed pass-through
securities. Interest and principal payments (including prepayments) on the
mortgages underlying such securities are passed through to the holders of the
security. Prepayments occur when the borrower under an individual mortgage
repays the remaining principal before the mortgage's scheduled maturity date. As
a result of the pass-through of prepayments of principal on the underlying
securities, mortgage-backed pass-through securities are often subject to more
rapid prepayments of principal than their stated maturity would indicate.
Because the prepayment

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characteristics of the underlying mortgages vary, it is not possible to predict
accurately the realized yield or average life of a particular issue of
pass-through certificates. Prepayments are important because of their effect on
the yield and price of the securities. During periods of declining interest
rates, such prepayments can be expected to accelerate, and the Funds would be
required to reinvest the proceeds at the lower interest rates then available. In
addition, prepayments of mortgages which underlie securities purchased at a
premium may not have been fully amortized at the time the obligation is repaid.
As a result of these principal prepayment features, mortgage-backed pass-through
securities are generally more volatile investments than other U.S. government
securities.

"Zero coupon" U.S. government securities also tend to be more volatile
than other types of U.S. government securities. Zero coupon securities are debt
instruments that do not pay current interest and are typically sold at prices
greatly discounted from par value. The return on a zero coupon obligation, when
held to maturity, equals the difference between the par value and the original
purchase price.

VARIABLE AMOUNT MASTER DEMAND NOTES. Variable amount master demand
notes, in which the Funds, except for the U.S. Treasury Obligations Fund, may
invest are unsecured demand notes that permit the indebtedness thereunder to
vary and provide for periodic adjustments in the interest rate according to the
terms of the instrument. They are also referred to as variable rate demand
notes. Because these notes are direct lending arrangements between the Fund and
the issuer, they are not normally traded. Although there may be no secondary
market in the notes, the Fund may demand payment of principal and accrued
interest at any time or during specified periods not exceeding one year,
depending upon the instrument involved, and may resell the note at any time to a
third party. The absence of such an active secondary market, however, could make
it difficult for a Fund to dispose of a variable amount master demand note if
the issuer defaulted on its payment obligations or during periods when the Fund
is not entitled to exercise their demand rights, and a Fund could, suffer a loss
to the extent of the default. While the notes are not typically rated by credit
rating agencies, issuers of variable amount master demand notes must satisfy the
criteria for commercial paper. SBCL will consider the earning power, cash flow,
and other liquidity ratios of the issuers of such notes and will continuously
monitor their financial status and ability to meet payment on demand. Where
necessary to ensure that a note is of "high quality," a Fund will require that
the issuer's obligation to pay the principal of the note be backed by an
unconditional bank letter or line of credit, guarantee or commitment to lend. In
determining dollar-weighted average portfolio maturity, a variable amount master
demand note will be deemed to have a maturity equal to the period of time
remaining until the principal amount can be recovered from the issuer through
demand.

VARIABLE AND FLOATING RATE NOTES. The Funds, other than the U.S.
Treasury Obligations Fund, may acquire variable and floating rate notes, subject
to each Fund's investment objective, policies, and restrictions. A variable rate
note is one whose terms provide for the adjustment of its interest rate on set
dates and which, upon such adjustment,

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can reasonably be expected to have a market value that approximates its par
value. A floating rate note is one whose terms provide for the adjustment of its
interest rate whenever a specified interest rate changes and which, at any time,
can reasonably be expected to have a market value that approximates its par
value. Such notes are frequently not rated by credit rating agencies; however,
unrated variable and floating rate notes purchased by a Fund will be determined
by SBCL under guidelines established by the Group's Board of Trustees to be of
comparable quality at the time of purchase to rated instruments eligible for
purchase under a Fund's investment policies. In making such determinations, SBCL
will consider the earning power, cash flow and other liquidity ratios of the
issuers of such notes (such issuers include financial, merchandising, bank
holding and other companies) and will continuously monitor their financial
condition. Although there may be no active secondary market with respect to a
particular variable or floating rate note purchased by a Fund, it may resell a
note at any time to a third party. The absence of an active secondary market,
however, could make it difficult for a Fund to dispose of a variable or floating
rate note in the event the issuer of the note defaulted on its payment
obligations and a Fund could, as a result or for other reasons, suffer a loss to
the extent of the default. Variable or floating rate notes may be secured by
bank letters of credit.

For purposes of the Money Market Funds, the maturities of the variable
and floating rate notes will be determined in accordance with Rule 2a-7 under
the 1940 Act.

WHEN-ISSUED SECURITIES. Each Fund may purchase securities on a
when-issued basis and may purchase and sell securities on a forward commitment
basis (I.E., for delivery beyond the normal settlement date at a stated price
and yield), including "TBA" (to be announced) purchase commitments. When a Fund
agrees to purchase securities on a when-issued or forward commitment basis, the
Fund's custodian will set aside cash or liquid portfolio securities equal to the
amount of the commitment in a separate account. Normally, the custodian will set
aside portfolio securities to satisfy the purchase commitment, and in such a
case, a Fund may be required subsequently to place additional assets in the
separate account in order to assure that the value of the account remains equal
to the amount of the Fund's commitment. It may be expected that any such Fund's
net assets will fluctuate to a greater degree when it sets aside portfolio
securities to cover such purchase commitments than when it sets aside cash.

When a Fund engages in when-issued or forward commitment transactions,
it relies on the seller to consummate the trade. Failure of the seller to do so
may result in the Fund incurring a loss or missing the opportunity to obtain a
price considered to be advantageous. In addition, the purchase of securities on
a when-issued or forward commitment basis involves a risk of loss if the value
of the security to be purchased declines prior to the settlement date. Each of
the Funds does not intend to purchase when-issued securities for speculative
purposes but only in furtherance of its investment objective.

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INVESTMENT RESTRICTIONS

For each Fund the following investment restrictions are fundamental and
cannot be changed without approval of the holders of a majority of the
outstanding voting securities (as defined in the 1940 Act) of that Fund.

1. The Fund may lend or borrow money to the extent permitted by the
1940 Act or the rules or regulations thereunder, as such statute, rules
or regulations may be amended from time to time.

2. The Fund may pledge, mortgage or hypothecate any of its assets to
the extent permitted by the 1940 Act or the rules or regulations
thereunder, as such statute, rules or regulations may be amended from
time to time.

3. The Fund may issue senior securities to the extent permitted by the
1940 Act or the rules or regulations thereunder, as such statute, rules
or regulations may be amended from time to time.

4. The Fund may purchase securities of any issuer only when consistent
with the maintenance of its status as a diversified company under the
1940 Act or the rules or regulations thereunder, as such statute, rules
or regulations may be amended from time to time.

5. The Fund may not concentrate investments in a particular industry or
group of industries as concentration is defined under the 1940 Act, or
the rules or regulations thereunder, as such statute, rules or
regulations may be amended from time to time.

6. The Fund may underwrite securities to the extent permitted by the
1940 Act or the rules or regulations thereunder, as such statute, rules
or regulations may be amended from time to time.

7. The Fund may purchase or sell commodities, commodities contracts,
futures contracts, or real estate to the extent permitted by the 1940
Act or the rules or regulations thereunder, as such statute, rules or
regulations may be amended from time to time.

ADDITIONAL INFORMATION REGARDING FUNDAMENTAL INVESTMENT RESTRICTIONS

The fundamental investment restrictions limit a Fund's ability to
engage in certain investment practices and purchase securities to the extent
permitted by, or consistent with, the 1940 Act. Relevant limitations of the 1940
Act are described below. Each Fund may be subject to more restrictive
non-fundamental investment policies. Non-fundamental investment policies may be
changed by the Board of Trustees.

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The following 1940 Act descriptions are to assist the investor in
understanding the fundamental restrictions above, and are not themselves
fundamental.

FUNDAMENTAL INVESTMENT RESTRICTION (1). The 1940 Act presently limits a
Fund's ability to borrow to one-third of the value of its total assets.
Borrowing by a Fund allows it to leverage its portfolio, which exposes it to
certain risks. Leveraging exaggerates the effect of any increase or decrease in
the value of portfolio securities on a Fund's net asset value, and money
borrowed will be subject to interest costs (which may include commitment fees
and/or the cost of maintaining minimum average balances) which may or may not
exceed the interest received from the securities purchased with borrowed funds.

The 1940 Act also restricts the ability of any mutual fund to lend.
Under the 1940 Act, a Fund may only make loans if expressly permitted to do so
by the Fund's investment policies, and a Fund may not make loans to persons who
control or are under common control with the Fund. Thus, the 1940 Act
effectively prohibits a Fund from making loans to certain persons when conflicts
of interest or undue influence are most likely present. The Funds may, however,
make other loans which if made would expose shareholders to certain additional
risks.

FUNDAMENTAL INVESTMENT RESTRICTION (2). The 1940 Act limits a Fund's
ability to pledge, mortgage or hypothecate its assets to one-third of its
assets. To the extent that pledged assets are encumbered for more than seven
days such assets would be considered illiquid and, therefore, each Fund's use of
such techniques would be limited to 15% of its net assets (10% for the Money
Market Funds).

FUNDAMENTAL INVESTMENT RESTRICTION (3). The ability of a mutual fund to
issue senior securities is severely circumscribed by complex regulatory
constraints under the 1940 Act that restrict, for instance, the amount, timing,
and form of senior securities that may be issued. Because portfolio management
techniques involving the issuance of senior securities, such as the purchase of
securities on margin, short sales, or the writing of puts on portfolio
securities, are all techniques that involve the leveraging of a portfolio and
would not be consistent with the current SEC rules governing Money Market Funds.

FUNDAMENTAL INVESTMENT RESTRICTION (4). Under Section 5(b) of the 1940
Act, an investment company is diversified if, as to 75% of its total assets, no
more than 5% of the value of its total assets is invested in the securities of a
single issuer and no more than 10% of the issuer's voting securities is held by
the investment company. However, each of the Funds is subject to the "per
issuer" diversification requirements of the Internal Revenue Code of 1986
("Code") at the Fund's tax quarter-ends. Under the Code, the 5% "per issuer"
limit is applied only to 50% of a Fund's total assets (not 75% of total assets
as under the 1940 Act). However, no single issuer can exceed 25% of a Fund's
total assets under the Code as well.

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FUNDAMENTAL INVESTMENT RESTRICTION (5). "Concentration" is interpreted
under the 1940 Act to mean investment of 25% or more of a Fund's total assets in
a single industry. If a Fund were to "concentrate" its investments in a narrow
industry, investors would be exposed to greater risks because the Fund's
performance would be largely dependent on that segment's performance. None of
the Funds have reserved the right to concentrate in any industry.

FUNDAMENTAL INVESTMENT RESTRICTION (6). The 1940 Act prohibits a
diversified mutual fund from underwriting securities in excess of 25% of its
total assets.

FUNDAMENTAL INVESTMENT RESTRICTION (7). This restriction would permit
investment in commodities, commodities contracts, futures contracts, or real
estate to the extent permitted under the 1940 Act. However, it is unlikely, that
the Funds would make such investments. Each Fund would like the ability to
consider using these investment techniques in the future. Commodities, as
opposed to commodity futures, represent the actual underlying bulk goods, such
as grains, metals and food stuffs. Real estate-related instruments include real
estate investment trusts, commercial and residential mortgage-backed securities,
and real estate financings, and such instruments are generally sensitive to
factors such as changes in real estate values and property taxes, interest
rates, cash flow of underlying real estate assets, overbuilding, and the
management skill and creditworthiness of the issuer. Given the Funds' proposed
investment objective, the Funds do not expect to invest in these types of
investments; however, if a Fund did so invest, it would be exposed to these
types of risks associated with the underlying security.

PORTFOLIO TURNOVER

The portfolio turnover rate for each Fund is calculated by dividing the
lesser of a Fund's purchases or sales of portfolio securities for the year by
the monthly average value of the portfolio securities. The calculation excludes
all securities whose maturities at the time of acquisition were one year or
less. High portfolio turnover rates will generally result in higher transaction
costs to the Funds and may result in higher levels of taxable realized gains to
a Fund's shareholders. The portfolio turnover rate may vary greatly from year to
year as well as within a particular year, and may also be affected by cash
requirements for redemptions of Shares. Portfolio turnover will not be a
limiting factor in making investment decisions.

Because securities with maturities of less than one year are excluded
from the calculation of the portfolio turnover rate, the portfolio turnover rate
for each Money Market Fund is expected to be zero for regulatory and reporting
purposes.

VALUATION

The net asset value of each Fund is determined and its Shares are
priced as of the close of regular trading of the NYSE (generally 4:00 p.m.
Eastern time) on each Business Day

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("Valuation Times"). For each Money Market Fund, as used herein a "Business Day"
constitutes (i) any day on which the Federal Reserve Bank is open and the NYSE
is open for trading and (ii) any other day (other than a day during which no
Shares are tendered for redemption and no orders to purchase Shares are
received) during which there is sufficient trading in a Fund's portfolio
instruments that the Fund's net asset value per share might be materially
affected. For each other fund, a Business Day is (i) any day on which the NYSE
is open for trading and (ii) any other day (other than a day during which no
Shares are tendered for redemption and no orders to purchase Shares are
received) during which there is sufficient trading in a Fund's portfolio
instruments that the Fund's net asset value per share might be materially
affected. Net asset value per Share for purposes of pricing sales and
redemptions is calculated by determining the value of the class's proportional
interest in the securities and other assets of a Fund, less (i) such class's
proportional share of general liabilities and (ii) the liabilities allocable
only to such class, and dividing such amount by the number of relevant class
Shares outstanding. Currently, the NYSE is closed on the customary national
business holidays of New Year's Day, Martin Luther King, Jr., Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day
and Christmas Day.

VALUATION OF THE MONEY MARKET FUNDS

The Money Market Funds use the amortized cost method of valuing their
securities. This involves valuing an instrument at its cost initially and
thereafter assuming a constant amortization to maturity of any discount or
premium, regardless of the impact of fluctuating interest rates on the market
value of the instrument. This method may result in periods during which value,
as determined by amortized cost, is higher or lower than the price each Money
Market Fund would receive if it sold the instrument. The value of each Money
Market Fund's securities can be expected to vary inversely with changes in
prevailing interest rates.

Pursuant to Rule 2a-7, each Money Market Fund will maintain a
dollar-weighted average portfolio maturity appropriate to its objective of
maintaining a stable net asset value per Share, provided that the Fund will not
purchase any security with a remaining maturity of more than thirteen months
(securities subject to repurchase agreements may bear longer maturities) nor
maintain a dollar-weighted average portfolio maturity which exceeds 90 days. The
Group's Board of Trustees has also undertaken to establish procedures reasonably
designed, taking into account current market conditions and each Money Market
Fund's investment objective, to stabilize the net asset value per Share for
purposes of sales and redemptions at $1.00. These procedures include review by
the Trustees, at such intervals as they deem appropriate, to determine the
extent, if any, to which the net asset value per Share deviates from $1.00 per
Share. In the event such deviation exceeds one-half of one percent, Rule 2a-7
requires the Board of Trustees to promptly consider what action, if any, should
be initiated. If the Board of Trustees determines that the deviation from a
$1.00 price per Share may result in material dilution or other unfair results to
Shareholders, it will take the appropriate steps to eliminate or reduce these
consequences to the extent reasonably practicable. These steps may include
selling portfolio instruments prior to maturity in order to

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realize capital gains or losses to shorten the average portfolio maturity,
adjusting or withholding dividends or utilizing a net asset value per Share
determined by using available market quotations.

VALUATION OF THE INVESTMENT GRADE BOND FUND, THE GLOBAL ASSET ALLOCATION FUND
AND THE EQUITY FUND

Portfolio securities for which market quotations are readily available
are valued based upon their current available bid prices in the principal market
(closing sales prices if the principal market is an exchange) in which such
securities are normally traded. Unlisted securities for which market quotations
are readily available will be valued at the current quoted bid prices. Other
securities and assets for which quotations are not readily available, including
restricted securities and securities purchased in private transactions, are
valued at their fair market value in SBCL's best judgment under procedures
established by, and under the supervision of the Group's Board of Trustees. A
Fund will value its investments in mutual funds securities at the redemption
price, which is net asset value.

Among the factors considered in valuing portfolio securities held by
the Funds, are the existence of restrictions upon the sale of the security by
the Fund, the absence of a market for the security, the extent of any discount
in acquiring the security, the estimated time during which the security will not
be freely marketable, the expenses of registering or otherwise qualifying the
security for public sale, underwriting commissions if underwriting would be
required to effect a sale, the current yields on comparable securities for debt
obligations traded independently of any equity equivalent, changes in the
financial condition and prospects of the issuer, and any other factors affecting
fair market value. In making valuations, opinions of counsel may be relied upon
as to whether or not securities are restricted securities and as to the legal
requirements for public sale.

The Group may use a pricing service to value certain portfolio
securities where the prices provided are believed to reflect the fair market
value of such securities. A pricing service would normally consider such factors
as yield, risk, quality, maturity, type of issue, trading characteristics,
special circumstances and other factors it deems relevant in determining
valuations of normal institutional trading units of debt securities and would
not rely exclusively on quoted prices. The methods used by the pricing service
and the valuations so established will be reviewed by the Group under the
general supervision of the Group's Board of Trustees. Several pricing services
are available, one or more of which may be used by SBCL from time to time.

Investments in debt securities with remaining maturities of 60 days or
less may be valued based upon the amortized cost method.

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VALUATION OF INTERNATIONAL SECURITIES

Valuation of securities of foreign issuers is as follows: to the extent
sale prices are available, securities which are traded on a recognized stock
exchange, whether U.S. or foreign, are valued at the last sale price on that
exchange prior to the time when assets are valued or prior to the close of
regular trading hours on the NYSE. In the event that there are no sales, the
means between the last available bid and asked prices will be used. If a
security is traded on more than one exchange, the last sale price on the
exchange where the stock is primarily traded is used. An option or futures
contract is valued at the last sales price prior to 4:00 p.m. Eastern time, as
quoted on the principal exchange or board of trade on which such option or
contract is traded, or in the absence of a sale, the mean between the last bid
and asked prices prior to 4:00 p.m. Eastern time. In the event that application
of these methods of valuation results in a price for a security which is deemed
not to be representative of the market value of such security, the security will
be valued by, under the direction of or in accordance with a method specified by
the Board of Trustees as reflecting fair value. The amortized cost method of
valuation will be used with respect to debt obligations with sixty days or less
remaining to maturity unless SBCL under the supervision of the Board of Trustees
determines such method does not represent fair value. All other assets and
securities held by the Fund (including restricted securities) are valued at fair
value as determined in good faith by the Board of Trustees or by someone under
its direction. Any assets which are denominated in a foreign currency are
translated into U.S. dollars at the prevailing market rates.

Certain of the securities acquired by the Global Asset Allocation Fund
may be traded on foreign exchanges or over-the-counter markets on days on which
the Fund's net asset value is not calculated. In such cases, the net asset value
of the Fund's shares may be significantly affected on days when investors can
neither purchase nor redeem shares of the Fund.

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

Each class of Shares of the Funds are sold on a continuous basis by
BISYS Fund Services, Inc. ("BISYS"). In addition to purchasing Shares directly
from BISYS, Class A or Trust Shares may be purchased through procedures
established by BISYS in connection with the requirements of accounts at SBCL, or
SBCL's affiliated or correspondent banks. Customers purchasing Shares of the
Group may include officers, directors, or employees of SBCL or SBCL's affiliated
or correspondent banks.

MATTERS AFFECTING REDEMPTION

The Group may suspend the right of redemption or postpone the date of
payment for Shares during any period when (a) trading on the NYSE is restricted
by applicable rules and regulations of the Securities and Exchange Commission,
(b) the NYSE is closed for other than

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customary weekend and holiday closings, (c) the Securities and Exchange
Commission has by order permitted such suspension, or (d) an emergency exists as
a result of which (i) disposal by the Group of securities owned by it is not
reasonably practical or (ii) it is not reasonably practical for the Company to
determine the fair market value of its total net assets.

The Group may redeem any class of Shares involuntarily if redemption
appears appropriate. See "Valuation of the Money Market Funds" above.

ADDITIONAL TAX INFORMATION

GENERAL

It is the policy of each of the Funds to qualify for the favorable tax
treatment accorded regulated investment companies (a "RIC") under Subchapter M
of the Internal Revenue Code of 1986, as amended (the "Code"). By qualifying as
a RIC, each Funds expects to eliminate or reduce to a nominal amount its federal
income taxes.

In order to qualify as a RIC, a Fund must (a) derive at least 90% of
its gross income from dividends, interest, payments with respect to certain
securities loans, and gains from the sale of stock, securities, and foreign
currencies, or other income (including but not limited to gains from options,
futures, or forward contracts) derived with respect to its business of investing
in such stock, securities, or currencies; (b) derive less than 30% of its gross
income from the sale or other disposition of certain assets (including stocks
and securities) held for less than three months; (c) distribute each year at
least 90% of its dividend, interest (including tax-exempt interest), and certain
other income and the excess, if any, of its net short-term capital gains over
its net long-term capital losses; and (d) diversify its holdings so that, at the
end of each fiscal quarter (i) at least 50% of the market value of its assets is
represented by cash, cash items, U.S. government securities, securities of other
RICs, and other securities, limited in respect of any one issuer to a value not
greater than 5% of the value of the Fund's total assets and 10% of the
outstanding voting securities of such issuer, and (ii) not more than 25% of the
value of its assets is invested in the securities (other than those of the U.S.
government or other RICs) of any one issuer or of two or more issuers which the
Fund controls and which are engaged in the same, similar, or related trades or
businesses. The 30% of gross income test described above may restrict a Fund's
ability to sell certain assets held (or considered under Code rules to have been
held) for less than three months and to engage in certain hedging transactions
(including hedging transactions in options and futures) that in some
circumstances could cause certain Fund assets to be treated as held for less
than three months.

A non-deductible excise tax is imposed on RICs that do not distribute
in each calendar year (regardless of whether they have a non-calendar taxable
year) an amount equal to 98% of their "ordinary income" (as defined) for the
calendar year plus 98% of their capital gain net

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income for the 1-year period ending on October 31 of such calendar year plus any
undistributed amounts from prior years. For the foregoing purposes, a Fund is
treated as having distributed any amount on which it is subject to income tax
for any taxable year ending in such calendar year. If distributions during a
calendar year by a Fund were less than the required amount, the Fund would be
subject to a non-deductible excise tax equal to 4% of the deficiency.

Each Fund will be required in certain cases to withhold and remit to
the U.S. Treasury 31% of taxable dividends and other distributions paid to any
Shareholder who has provided either an incorrect taxpayer identification number
or no number at all, who is subject to withholding by the Internal Revenue
Service for failure properly to report payments of interest or dividends, or who
fails to provide a certified statement that he or she is not subject to "backup
withholding."

A Fund's transactions in futures contracts, options, and
foreign-currency-denominated securities, and certain other investment and
hedging activities of the Fund, will be subject to special tax rules (including
"mark-to-market," "straddle," "wash sale," and "short sale" rules), the effect
of which may be to accelerate income to the Fund, defer losses to the Fund,
cause adjustments in the holding periods of the Fund's assets, convert
short-term capital losses into long-term capital losses, and otherwise affect
the character of the Fund's income. These rules could therefore affect the
amount, timing, and character of distributions to Shareholders. Income earned as
a result of these transactions would, in general, not be eligible for the
dividends received deduction or for treatment as exempt-interest dividends when
distributed to Shareholders. The Funds will endeavor to make any available
elections pertaining to these transactions in a manner believed to be in the
best interest of the Funds.

Investment by the Fund in "passive foreign investment companies" could
subject the Fund to federal income tax or other charge on the proceeds from the
sale of its investment in such a company; however, this tax can be avoided by
making an election to mark such investments to market annually or to treat the
passive foreign investment company as a "qualified electing fund."

A "passive foreign investment company" is any foreign corporation: (i)
75 percent or more of the income of which for the taxable year is passive
income, or (ii) the average percentage of the assets of which (generally by
value, but by adjusted tax basis in certain cases) that produce or are held for
the production of passive income is at least 50 percent. Generally, passive
income for this purpose means dividends, interest (including income equivalent
to interest), royalties, rents, annuities, the excess of gains over losses from
certain property transactions and commodities transactions, and foreign currency
gains. Passive income for this purpose does not include rents and royalties
received by the foreign corporation from active business and certain income
received from related persons.

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Although each Fund expects to qualify as a RIC and to be relieved of
all or substantially all Federal income taxes, depending upon the extent of
their activities in states and localities in which their offices are maintained,
in which their agents or independent contractors are located, or in which they
are otherwise deemed to be conducting business, the Funds may be subject to the
tax laws of such states or localities. If for any taxable year a Fund does not
qualify for the special federal tax treatment afforded a RIC, all of its taxable
income will be subject to federal income tax at regular corporate rates at the
Fund level (without any deduction for distributions to its Shareholders). In
addition, distributions to Shareholders will be taxed as ordinary income even if
the distributions are attributable to capital gains or exempt interest earned by
the Fund.

Information set forth in the Prospectuses and this Statement of
Additional Information which relates to federal taxation is only a summary of
some of the important federal tax considerations generally affecting purchasers
of Shares of the Funds. No attempt has been made to present a detailed
explanation of the federal income tax treatment of a Fund or its Shareholders
and this discussion is not intended as a substitute for careful tax planning.
Accordingly, potential purchasers of Shares of a Fund are urged to consult their
tax advisers. In addition, the tax discussion in the Prospectuses and this
Statement of Additional Information is based on tax laws and regulations which
are in effect on the date of the Prospectuses and this Statement of Additional
Information; such laws and regulations may be changed by legislative or
administrative action.

ADDITIONAL TAX INFORMATION CONCERNING THE GLOBAL ASSET ALLOCATION FUND

Special rules govern the federal income tax treatment of the portfolio
transactions of the Global Asset Allocation Fund that are denominated in terms
of a currency other than the U.S. dollar or determined by reference to the value
of one or more currencies other than the U.S. dollar. The types of transactions
covered by the special rules include the following: (i) the acquisition of, or
becoming the obligor under, a bond or other debt instrument (including, to the
extent provided in Treasury regulations, certain preferred stock); (ii) the
accruing of certain trade receivables and payables; (iii) the entering into or
acquisition of any forward contract or similar financial instruments; and (iv)
the entering into or acquisition of any futures contract, option or similar
financial instrument, if such instrument is not marked-to-market. The
disposition of a currency other than the U.S. dollar by a U.S. taxpayer also is
treated as a transaction subject to the special currency rules. With respect to
such transactions, foreign currency gain or loss is calculated separately from
any gain or loss on the underlying transaction and is normally taxable as
ordinary gain or loss. A taxpayer may elect to treat as capital gain or loss
foreign currency gain or loss arising from certain identified forward contracts
that are capital assets in the hands of the taxpayer and which are not part of a
straddle ("Capital Asset Election"). In accordance with Treasury regulations,
certain transactions with respect to which the taxpayer has not made the Capital
Asset Election and that are part of a "988 hedging transaction" (as defined in
the Code and the Treasury regulations) are integrated and treated as a single
transaction or otherwise treated consistently

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for purposes of the Code. "988 hedging transactions" (as identified by such
Treasury regulations) are not subject to the market-to-market or loss deferral
rules under the Code. Some of the non-U.S. dollar-denominated investments that
the Fund may make (such as non-U.S. dollar-denominated debt securities and
obligations and preferred stock) and some of the foreign currency contracts the
Fund may enter into will be subject to the special currency rules described
above. Gain or loss attributable to the foreign currency component of
transactions engaged in by a Fund which is not subject to the special currency
rules (such as foreign equity investments other than certain preferred stocks)
will be treated as capital gain or loss and will not be segregated from the gain
or loss on the underlying transaction.

In addition, certain forward foreign currency contracts held by the
Fund at the close of the Fund's taxable year will be subject to "mark-to-market"
treatment. If the Fund makes the Capital Asset Election with respect to such
contracts, any gain or loss with respect to the contract shall be treated as
short-term capital gain or loss, to the extent of 40% of such gain or loss, and
long-term capital gain or loss, to the extent of 60% of such gain or loss.
Otherwise, such gain or loss will be ordinary in nature. To receive such federal
income tax treatment, a foreign currency contract must meet the following
conditions: (1) the contract must require delivery of a foreign currency of a
type in which regulated futures contracts are traded or upon which the
settlement value of the contract depends; (2) the contract must be entered into
at arm's length at a price determined by reference to the price in the interbank
market; and (3) the contract must be traded in the interbank market. The
Treasury Department has broad authority to issue regulations under these
provisions respecting foreign currency contracts. Forward foreign currency
contracts entered into by the Fund also may result in the creation of one or
more straddles for federal income tax purposes, in which case certain loss
deferral, short sales, and wash sales rules and requirements to capitalize
interest and carrying charges may apply.

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MANAGEMENT OF SANWA MUTUAL FUNDS GROUP

TRUSTEES AND OFFICERS

The Trustees and officers of each Fund, their current addresses, and
principal occupations during the past five years are as follows (if no address
is listed, the address is _____________________, Columbus, Ohio ______):

Position(s) Held Principal Occupation
Name and address With The Group During The Past 5 Years
- ---------------- -------------- -----------------------

The officers of the Group receive no compensation directly from the
Group for performing the duties of their offices. BISYS receives fees from the
Group for acting as Administrator and receives fees from the Group for acting as
Transfer Agent and for providing fund accounting services to the Group.

INVESTMENT ADVISER

Investment advisory and management services are provided to each Fund
by SBCL pursuant to an Investment Advisory Agreement ("Advisory Agreement")
dated ______________, 1997.

The Advisory Agreement provides that SBCL shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Group in
connection with the performance of such Advisory Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith, or gross negligence on the part of SBCL in the performance of its duties,
or from reckless disregard by SBCL of its duties and obligations thereunder.

The Advisory Agreement will continue in effect until
__________________, 1999 as to each of the Funds and from year to year if such
continuance is approved at least annually by the Group's Board of Trustees or by
vote of the holders of a majority of the outstanding Shares of that Fund (as
defined under "GENERAL INFORMATION - Miscellaneous"). The Advisory Agreement is
terminable as to a particular Fund at any time upon 60 days written notice
without penalty by the Trustees, by vote of the holders of a majority of the
outstanding Shares of that Fund, or by SBCL. The Advisory Agreement also
terminates automatically in the event of any assignment, as defined in the 1940
Act.

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PORTFOLIO TRANSACTIONS

Pursuant to the Advisory Agreement, SBCL determines, subject to the
general supervision of the Board of Trustees of the Group and in accordance with
each Fund's investment objective and restrictions, which securities are to be
purchased and sold by a Fund, and which brokers are to be eligible to execute
portfolio transactions. Purchases and sales of portfolio securities with respect
to the Funds usually are principal transactions in which portfolio securities
are purchased directly from the issuer or from an underwriter or market maker
for the securities. Purchases from underwriters of portfolio securities
generally include (but not in the case of mutual fund shares purchased by the
Funds) a commission or concession paid by the issuer to the underwriter and
purchases from dealers serving as market makers may include the spread between
the bid and asked price. Transactions on stock exchanges involve the payment of
negotiated brokerage commissions. Transactions in the over-the-counter market
are generally principal transactions with dealers. With respect to the
over-the-counter market, the Group, where possible, will deal directly with
dealers who make a market in the securities involved unless better price and
execution are available elsewhere. While SBCL generally seeks competitive
spreads or commissions, the Group may not necessarily pay the lowest spread or
commission available on each transaction, for reasons discussed below.

Allocation of transactions, including their frequency, to various
dealers is determined by SBCL in its best judgment and in a manner deemed fair
and reasonable to Shareholders. The major consideration in allocating brokerage
business is the assurance that the best execution is being received on all
transactions. Brokerage will at times be allocated to firms that supply
research, statistical data and other services when the terms of the transaction
and the capabilities of different broker/dealers are consistent with the
guidelines set forth in Section 28(e) of the Securities Exchange Act of 1934.
Information so received is in addition to, and not in lieu of, services required
to be performed by SBCL and does not reduce the advisory fees payable to SBCL.
Such information may be useful to SBCL in serving both the Group and other
clients and, conversely, supplemental information obtained by the placement of
business of other clients may be useful to SBCL in carrying out its obligations
to the Group.

Except as otherwise disclosed to the Shareholders of the Funds and as
permitted by applicable rules and regulations, SBCL will not execute portfolio
transactions on behalf of the Funds through, acquire portfolio securities issued
by, make savings deposits in, or enter into repurchase or reverse repurchase
agreements with SBCL, BISYS Fund Services, or their affiliates, and will not
give preference to SBCL's correspondents with respect to such transactions,
securities, savings deposits, repurchase agreements, and reverse repurchase
agreements.

Investment decisions for each Fund are made independently from those
for the other Funds or any other investment company or account managed by SBCL.
Other investment companies or accounts may also invest in the same securities as
the Group. When a purchase or sale of the same security is made at substantially
the same time on behalf of a Fund and

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another Fund of the Group, investment company or account, the transaction will
be averaged as to price and available investments will be allocated as to amount
in a manner which SBCL believes to be equitable to the Fund(s) and such other
investment company or account. In some instances, this investment procedure may
adversely affect the price paid or received by a Fund or the size of the
position obtained by a Fund. To the extent permitted by law, SBCL may aggregate
the securities to be sold or purchased for a Fund with those to be sold or
purchased for the other Funds or for other investment companies or accounts in
order to obtain best execution. As provided by the Advisory Agreement, in making
investment recommendations for the Group, SBCL will not inquire or take into
consideration whether an issuer of securities proposed for purchase or sale by
the Group is a customer of SBCL or their parents, subsidiaries, or affiliates,
and, in dealing with their customers, SBCL and their parents, subsidiaries, and
affiliates will not inquire or take into consideration whether securities of
such customers are held by the Group.

GLASS-STEAGALL ACT

In 1971, the United States Supreme Court held in INVESTMENT COMPANY
INSTITUTE V. CAMP that the Federal statute commonly referred to as the
Glass-Steagall Act prohibits a bank from operating a mutual fund for the
collective investment of managing agency accounts. Subsequently, the Board of
Governors of the Federal Reserve System (the "Board") issued a regulation and
interpretation to the effect that the Glass-Steagall Act and such decision: (a)
forbid a bank holding company registered under the Federal Bank Holding Company
Act of 1956 (the "Holding Company Act") or any non-bank affiliate thereof from
sponsoring, organizing, or controlling a registered, open-end investment company
continuously engaged in the issuance of its shares, but (b) do not prohibit such
a holding company or affiliate from acting as investment adviser, transfer
agent, and custodian to such an investment company. In 1981, the United States
Supreme Court held in BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM V.
INVESTMENT COMPANY INSTITUTE that the Board did not exceed its authority under
the Holding Company Act when it adopted its regulation and interpretation
authorizing bank holding companies and their non-bank affiliates to act as
investment advisers to registered closed-end investment companies. In the BOARD
OF GOVERNORS case, the Supreme Court also stated that if a bank complied with
the restrictions imposed by the Board in its regulation and interpretation
authorizing bank holding companies and their non-bank affiliates to act as
investment advisers to investment companies, a bank performing investment
advisory services for an investment company would not violate the Glass-Steagall
Act.

SBCL believes that they possess the legal authority to perform the
services for each Fund contemplated by the Advisory Agreement and described in
the Prospectuses and this Statement of Additional Information and has so
represented in the Advisory Agreement. Future changes in either federal or state
statutes and regulations relating to the permissible activities of banks or bank
holding companies and the subsidiaries or affiliates of those entities, as well
as further judicial or administrative decisions or interpretations of present
and future statutes and regulations, could prevent or restrict SBCL from
continuing to perform

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such services for the Group. Depending upon the nature of any changes in the
services which could be provided by SBCL, the Board of Trustees of the Group
would review the Group's relationship with SBCL and consider taking all action
necessary in the circumstances.

Should future legislative, judicial, or administrative action prohibit
or restrict the proposed activities of SBCL or their affiliated and
correspondent banks (the "Banks") in connection with Customer's purchases of
Shares of the Group, the Banks might be required to alter materially or
discontinue the services offered by them to Customers. It is not anticipated,
however, that any change in the Group's method of operations would affect its
net asset value per Share or result in financial losses to any Customer.

ADMINISTRATOR

BISYS serves as administrator (the "Administrator") to each Fund
pursuant to the Management and Administration Agreement dated as of
______________, 1997 (the "Administration Agreement"). The Administrator assists
in supervising operations of each Fund (other than those performed by SBCL under
the Advisory Agreement, those performed by ____________________ under its
custodial services agreements with the Group, and those performed by BISYS Fund
Services, Inc. under its transfer agency and shareholder service and fund
accounting agreements with the Group). The Administrator is a broker-dealer
registered with the Securities and Exchange Commission, and is a member of the
National Association of Securities Dealers, Inc. The Administrator provides
financial services to institutional clients.

Under the Administration Agreement, the Administrator has agreed to
[MONITOR THE NET ASSET VALUE OF THE MONEY MARKET FUNDS, TO MAINTAIN OFFICE
FACILITIES FOR THE GROUP, TO MAINTAIN THE GROUP'S FINANCIAL ACCOUNTS AND
RECORDS, AND TO FURNISH THE GROUP STATISTICAL AND RESEARCH DATA AND CERTAIN
BOOKKEEPING SERVICES, AND CERTAIN OTHER SERVICES REQUIRED BY THE GROUP]. The
Administrator prepares annual and semi-annual reports to the Securities and
Exchange Commission, prepares federal and state tax returns, prepares filings
with state securities commissions, and generally assists in supervising all
aspects of the Group's operations (other than those performed by SBCL under the
Advisory Agreement, and those performed by _________________, under its
custodial services agreements with the Group, and those performed by BISYS under
its transfer agency and shareholder service and fund accounting agreements with
the Group). Under the Administration Agreement, the Administrator may delegate
all or any part of its responsibilities thereunder.

Under the Administration Agreement, the Administrator receives a fee
from each Fund equal to the lesser of (a) a fee computed at the annual rate of
twenty one-hundredths of one percent (.20%) of such Fund's average daily net
assets or (b) such fee as may from time to time be agreed upon in writing by the
Group and the Administrator. A fee agreed to in writing from time to time by the
Group and the Administrator may be significantly lower than the fee calculated
at the annual rate and the effect of such lower fee would be to lower a

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Fund's expenses and increase the net income of the Fund during the period when
such lower fee is in effect.

The Administration Agreement will continue until _______________, 1999.
Thereafter, the Administration Agreement shall be renewed automatically for
successive [FIVE] year terms, unless written notice not to renew is given by the
non-renewing party to the other party at least 60 days prior to the expiration
of the then-current term. The Administration Agreement is terminable with
respect to a particular Fund only upon mutual agreement of the parties to the
Administration Agreement and for cause (as defined in the Administration
Agreement) by the party alleging cause, on not less than 60 days notice by the
Group's Board of Trustees or by the Administrator.

The Administration Agreement provides that the Administrator shall not
be liable for any loss suffered by the Group in connection with the matters to
which the Administration Agreement relates, except a loss resulting from willful
misfeasance, bad faith, or gross negligence in the performance of its duties, or
from the reckless disregard by the Administrator of its obligations and duties
thereunder.

DISTRIBUTOR

BISYS serves as distributor to each Fund pursuant to a Distribution
Agreement dated ________________, 1997 (the "Distribution Agreement"). The
Distribution Agreement will continue in effect for one-year periods if such
continuance is approved at least annually (i) by the Group's Board of Trustees
or by the vote of a majority of the outstanding Shares of the Funds or Fund
subject to such Distribution Agreement, and (ii) by the vote of a majority of
the Trustees of the Group who are not parties to such Distribution Agreement or
interested persons (as defined in the 1940 Act) of any party to such
Distribution Agreement, cast in person at a meeting called for the purpose of
voting on such approval. The Distribution Agreement may be terminated in the
event of any assignment, as defined in the 1940 Act.

For its services as Distributor, BISYS is entitled to a fee of [0.25%]
of the average daily net assets of Class A Shares of each Fund payable under the
Fund's Distribution Plan.

The Distribution Plan was initially approved on ________________, 1997
by the Fund's Board of Trustees, including a majority of the trustees who are
not interested persons of the Fund (as defined in the 1940 Act) and who have no
direct or indirect financial interest in the Distribution Plan (the "Independent
Trustees"). The Distribution Plan provides for fees only upon the Class A Shares
of each Fund.

In accordance with Rule 12b-1 under the 1940 Act, the Distribution Plan
may be terminated with respect to any Fund by a vote of a majority of the
Independent Trustees, or by a vote of a majority of the outstanding Class A
Shares of that Fund. The Distribution Plan

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may be amended by vote of the Fund's Board of Trustees, including a majority of
the Independent Trustees, cast in person at a meeting called for such purpose,
except that any change in the Distribution Plan that would materially increase
the distribution fee with respect to a Fund requires the approval of the holders
of that Fund's Class A Shares. The Group's Board of Trustees will review on a
quarterly and annual basis written reports of the amounts received and expended
under the Distribution Plan (including amounts expended by the Distributor to
Participating Organizations pursuant to the Servicing Agreements entered into
under the Distribution Plan) indicating the purposes for which such expenditures
were made.

CUSTODIAN

_____________ serves as the Group's Custodian.

TRANSFER AGENT AND FUND ACCOUNTING SERVICES

BISYS serves as transfer agent to each Fund pursuant to a Transfer
Agency Agreement.

BISYS also provides fund accounting services to each of the Funds
pursuant to a Fund Accounting Agreement with the Group. Under the Fund
Accounting Agreement, BISYS receives a fee from each Fund at the annual rate of
[___%] of such Fund's average daily net assets, subject to a minimum annual fee.

INDEPENDENT ACCOUNTANTS

Ernst & Young has been selected as independent certified public
accountants. Ernst & Young's address is _____________________________.

LEGAL COUNSEL

Ropes & Gray, One Franklin Square, 1301 K Street, N.W., Suite 800 East,
Washington, DC 20005 serve as counsel to the Group.

PERFORMANCE INFORMATION

YIELDS OF THE MONEY MARKET FUNDS

As summarized in the Fund's Prospectuses under the heading "Performance
Information," the "yield" of each Money Market Fund for a seven-day period (a
"base period") will be computed by determining the "net change in value"
(calculated as set forth below) of a hypothetical account having a balance of
one share at the beginning of the period, dividing the net change in account
value by the value of the account at the beginning of the base period to obtain
the base period return, and multiplying the base period return by 365/7

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with the resulting yield figure carried to the nearest hundredth of one percent.
Net changes in value of a hypothetical account will include the value of
additional shares purchased with dividends from the original share and dividends
declared on both the original share and any such additional shares, but will not
include realized gains or losses or unrealized appreciation or depreciation on
portfolio investments. Yield may also be calculated on a compound basis (the
"effective yield") which assumes that net income is reinvested in Fund shares at
the same rate as net income is earned for the base period.

The yield and effective yield of each Money Market Fund will vary in
response to fluctuations in interest rates and in the expenses of each Fund. For
comparative purposes the current and effective yields should be compared to
current and effective yields offered by competing financial institutions for
that base period only and calculated by the methods described above.

YIELDS OF THE VARIABLE NAV FUNDS

As summarized in the Prospectuses under the heading "Performance
Information," yields of the Variable NAV Funds will be computed by annualizing
net investment income per share for a recent 30-day period and dividing that
amount by the maximum offering price per share (reduced by any undeclared earned
income expected to be paid shortly as a dividend) on the last trading day of
that period, according to the following formula:

a-b
30-Day Yield = 2[( ----- +1)(6)-1]
cd

In the above formula, "a" represents dividends and interest earned by a
particular class during the 30-day base period; "b" represents expenses accrued
to a particular class for the 30-day base period (net of reimbursements); "c"
represents the average daily number of shares of a particular class outstanding
during the 30-day base period that were entitled to receive dividends; and "d"
represents the maximum offering price per share of a particular class on the
last day of the 30-day base period.

Net investment income will reflect amortization of any market value
premium or discount of fixed income securities (except for obligations backed by
mortgages or other assets) and may include recognition of a pro rata portion of
the stated dividend rate of dividend paying portfolio securities. The yield of
each of the Variable NAV Funds will vary from time to time depending upon market
conditions, the composition of the Fund's portfolio and operating expenses of
the Group allocated to each Fund. These factors and possible differences in the
methods used in calculating yield should be considered when comparing a Fund's
yield to yields published for other investment companies and other investment
vehicles. Yield should also be considered relative to changes in the value of
the Fund's shares and to the relative risks associated with the investment
objectives and policies of each Fund.

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Investors in the Variable NAV Funds are specifically advised that share
prices, expressed as the net asset values per share, will vary just as yields
will vary.

CALCULATION OF TOTAL RETURN

Total Return is a measure of the change in value of an investment in a
Fund over the period covered, assuming the investor paid the current maximum
applicable sales charge on the investment and that any dividends or capital
gains distributions were reinvested in the Fund immediately rather than paid to
the investor in cash. The formula for calculating Total Return includes four
steps: (1) adding to the total number of shares purchased by a hypothetical
$1,000 investment in the Fund all additional shares which would have been
purchased if all dividends and distributions paid or distributed during the
period had been immediately reinvested; (2) calculating the value of the
hypothetical initial investment of $1,000 as of the end of the period by
multiplying the total number of shares owned at the end of the period by the net
asset value per share on the last trading day of the period; (3) assuming
redemption at the end of the period; and (4) dividing this account value for the
hypothetical investor by the initial $1,000 investment and annualizing the
result for periods of less than one year.

At any time in the future, yields and total return may be higher or
lower than past yields, there can be no assurance that any historical results
will continue.

PERFORMANCE COMPARISONS

YIELD AND TOTAL RETURN. From time to time, performance information for
the Funds showing their average annual total return and/or yield may be included
in advertisements or in information furnished to present or prospective
shareholders and the ranking of those performance figures relative to such
figures for groups of mutual funds categorized by Lipper Analytical Services as
having the same investment objectives may from time to time be included in
advertisements.

From time to time, the Group may include the following types of
information in advertisements, supplemental sales literature and reports to
Shareholders: (1) discussions of general economic or financial principals (such
as the effects of inflation, the power of compounding and the benefits of
dollar-cost averaging); (2) discussions of general economic trends; (3)
presentations of statistical data to supplement such discussions; (4)
descriptions of past or anticipated portfolio holdings for one or more of the
Funds within the Group, (5) descriptions of investment strategies for one or
more of such Funds; (6) descriptions or comparisons of various savings and
investment products (including, but not limited to, insured bank products,
annuities, qualified retirement plans and individual stocks and bonds), which
may or may not include the Funds; (7) comparisons of investment products
(including the Funds) with relevant market or industry indices or other
appropriate benchmarks; (8) discussions of fund rankings or ratings by
recognized rating organizations; and (9) testimonials describing the experience
of persons that have invested in one or more of the Funds. The Funds may also
include in these communications calculations, such as

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hypothetical compounding examples, that describe hypothetical investment
results, such performance examples will be based on an express set of
assumptions and are not indicative of performance of any of the Funds.

Total return and/or yield may also be used to compare the performance
of the Funds against certain widely acknowledged standards or indices for stock
and bond market performance. The Standard & Poor's Composite Index of 500 stocks
(the "S&P 500") is a market value-weighted and unmanaged index showing the
changes in the aggregate market value of 500 Stocks relative to the base period
1941-43. The S&P 500 is composed almost entirely of common stocks of companies
listed on the NYSE, although the common stocks of a few companies listed on the
American Stock Exchange or traded over-the-counter are included. The 500
companies represented include 400 industrial, 60 transportation and 40 financial
services concerns. The S&P 500 represents about 80% of the market value of all
issues traded on the NYSE.

The Morgan Stanley Capital International Europe, Australia and the Far
East Index ("EAFE") is an index composed of a sample of companies representative
of the market structure of twenty European and Pacific Basin countries. The
Index represents the evolution of an unmanaged portfolio consisting of all
domestically listed stocks.

The Lehman Aggregate Bond Index ("Aggregate Bond Index") is a measure
of the market value of all public obligations of the U.S. Treasury; all publicly
issued debt of all agencies of the U.S. government; all quasi-federal
corporations; all corporate debt guaranteed by the U.S. government; and mortgage
backed securities. Corporate issues must have amounts outstanding in excess of
$1 million, have at least one year to maturity and be rated investment grade by
a NRSRO. Flower bonds and foreign targeted issues are also included in the
Aggregate Bond Index.

Current yields or performance will fluctuate from time to time and are
not necessarily representative of future results. Accordingly, a Fund's yield or
performance may not provide for comparison with bank deposits or other
investments that pay a fixed return for a stated period of time. Yield and
performance are functions of quality, composition, and maturity, as well as
expenses allocated to the Fund. Fees imposed upon customer accounts by SBCL or
its affiliated or correspondent banks for cash management services will reduce a
Fund's effective yield to Customers.

ADDITIONAL INFORMATION

ORGANIZATION AND DESCRIPTION OF SHARES

The Group was organized as a Massachusetts business trust by the
Agreement and Declaration of Trust, dated April 7, 1997, under the name "Sanwa
Fund." A copy of the Group's Amended and Restated Agreement and Declaration of
Trust, (the "Declaration of Trust") is on file with the Secretary of State of
The Commonwealth of Massachusetts. The

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Declaration of Trust authorizes the Board of Trustees to issue an unlimited
number of Shares, which are units of beneficial interest. The Group presently
has five series of Shares offered to the public. The Group's Declaration of
Trust authorizes the Board of Trustees to divide or redivide any unissued Shares
of the Group into one or more additional series.

Shares have no subscription or preemptive rights and only such
conversion or exchange rights as the Board of Trustees may grant in its
discretion. When issued for payment as described in the Prospectuses and this
Statement of Additional Information, the Group's Shares will be fully paid and
non-assessable. In the event of a liquidation or dissolution of the Group,
Shareholders of a Fund are entitled to receive the assets available for
distribution belonging to that Fund, and a proportionate distribution, based
upon the relative asset values of the respective Funds, of any general assets
not belonging to any particular Fund which are available for distribution.

As described in the text of the Prospectuses following the caption
"GENERAL INFORMATION -- Description of the Group and its Shares," shares of the
Group are entitled to one vote per share (with proportional voting for
fractional shares) on such matters as shareholders are entitled to vote.
Shareholders vote in the aggregate and not by series or class on all matters
except (i) when required by the 1940 Act, shares shall be voted by individual
series, (ii) when the Trustees have determined that the matter affects only the
interests of a particular series or class, then only Shareholders of such series
or class shall be entitled to vote thereon, and (iii) only the holders of Class
A Shares will be entitled to vote on matters submitted to Shareholder vote with
regard to the Distribution Plan applicable to Class A. There will normally be no
meetings of Shareholders for the purposes of electing Trustees unless and until
such time as less than a majority of the Trustees have been elected by the
Shareholders, at which time the Trustees then in office will call a
Shareholders' meeting for the election of Trustees. In addition, Trustees may be
removed from office by a written consent signed by the holders of two-thirds of
the outstanding shares of the Group and filed with the Group's custodian or by
vote of the holders of two-thirds of the outstanding shares of the Group at a
meeting duly called for the purpose, which meeting shall be held upon the
written request of the holders of not less than 10% of the outstanding shares of
any Fund. Except as set forth above, the Trustees shall continue to hold office
and may appoint their successors.

SHAREHOLDER AND TRUSTEE LIABILITY

Under Massachusetts law, Shareholders could, under certain
circumstances, be held personally liable for the obligations of the Group.
However, the Group's Declaration of Trust disclaims Shareholder liability for
acts or obligations of the Group and requires that notice of such disclaimer be
given in every agreement, obligation or instrument entered into or executed by
the Group or the Trustees. The Declaration of Trust provides for indemnification
out of a Fund's property for all loss and expense of any Shareholder of such
Fund held liable on account of being or having been a Shareholder. Thus, the
risk of a Shareholder incurring

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financial loss on account of Shareholder liability is limited to circumstances
in which a Fund would be unable to meet its obligations.

The Agreement and Declaration of Trust states further that no Trustee,
officer or agent of the Group shall be personally liable in connection with the
administration or preservation of the assets of the Group or the conduct of the
Group's business; nor shall any Trustee, officer, or agent be personally liable
to any person for any action or failure to act except for his own bad faith,
willful misfeasance, gross negligence, or reckless disregard of his duties. The
Agreement and Declaration of Trust also provides that all persons having any
claim against the Trustees or the Group shall look solely to the assets of the
Group for payment.

MISCELLANEOUS

The Group may include information in its Annual Reports and Semi-Annual
Reports to Shareholders that (1) describes general economic trends, (2)
describes general trends within the financial services industry or the mutual
fund industry, (3) describes past or anticipated portfolio holdings for one or
more of the Funds within the Group, or (4) describes investment management
strategies for such Funds. Such information is provided to inform Shareholders
of the activities of the Group for the most recent fiscal year or half-year and
to provide the views of the SBCL and/or Group officers regarding expected trends
and strategies.

The organizational expenses of the Group have been allocated to each
Fund and are being amortized over a period of [FIVE] years from the commencement
of the public offering of Shares of the Group. In the event any of the initial
Shares of the Group are redeemed during the amortization period by any holder
thereof, the redemption proceeds will be reduced by a pro rata portion of any
unamortized organization expenses in the same proportion as the number of
initial Shares being redeemed bears to the total number of initial Shares
outstanding at the time of redemption. Investors purchasing Shares of the Group
subsequent to the date of the Prospectuses and this Statement of Additional
Information bear such expenses only as they are amortized against a Fund's
investment income.

The Group is registered with the Securities and Exchange Commission as
a management investment company. Such registration does not involve supervision
by the Securities and Exchange Commission of the management or policies of the
Group.

As of __________________, 1997, BISYS, P.O. Box XXXX, Columbus, Ohio
XXXXX, directly or beneficially owned 100% of each Fund.

The Prospectuses of the Funds and this Statement of Additional
Information omit certain of the information contained in the Registration
Statement filed with the Securities and Exchange Commission. Copies of such
information may be obtained from the Securities and Exchange Commission upon
payment of the prescribed fee.

B-39

<PAGE> 122

The Prospectuses of the Funds and this Statement of Additional
Information are not an offering of the securities herein described in any state
in which such offering may not lawfully be made. No salesman, dealer, or other
person is authorized to give any information or make any representation other
than those contained in the Prospectuses of the Funds and this Statement of
Additional Information.

B-40

<PAGE> 123

APPENDIX

The NRSROs utilized by SBCL include Moody's Investors Service, Inc. ("Moody's"),
Standard & Poor's Corporation ("S&P"), Duff & Phelps Credit Rating Co. ("Duff"),
Fitch Investors Service, Inc. ("Fitch"), IBCA Limited and its affiliate, IBCA
Inc. (collectively, "IBCA"), and Thomson BankWatch, Inc. ("Thomson"). Set forth
below is a description of the relevant ratings of each such NRSRO.

LONG-TERM DEBT RATINGS (may be assigned, for example, to corporate and municipal
bonds)

Description of the five highest long-term debt ratings by Moody's (Moody's
applies numerical modifiers (1, 2, and 3) in each rating category to indicate
the security's ranking within the category):

Aaa Bonds which are rated Aaa are judged to be of the best
quality. They carry the smallest degree of investment risk and
are generally referred to as "gilt edged." 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 Bonds which are rated Aa are judged to be of high quality by
all standards. Together with the Aaa group they comprise what
are generally known as high-grade bonds. They are rated lower
than the best bonds because margins of protection may not be
as large as in Aaa securities or fluctuation of protective
elements may be of greater amplitude or there may be other
elements present which make the long-term risk appear somewhat
larger than in Aaa securities.

A Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper-medium-grade
obligations. Factors giving security to principal and interest
are considered adequate, but elements may be present which
suggest a susceptibility to impairment some time in the
future.

Baa Bonds which 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 which are rated Ba are judged to have 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

B-41

<PAGE> 124

during both good and bad times in the future. Uncertainty of
position characterizes bonds in this class.

Description of the five highest long-term debt ratings by S&P (S&P may apply a
plus (+) or minus (-) to a particular rating classification to show relative
standing within that classification):

AAA Debt rated AAA has the highest rating assigned by S&P. The
obligor's capacity to meet its financial commitment on the
obligation is extremely strong.

AA Debt rated AA differs from the highest rated obligations only
in small degree. The obligor's capacity to meet its financial
commitment on the obligation is very strong.

A Debt rated A is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions
than obligations in higher rated categories. However, the
obligor's capacity to meet its financial commitment on the
obligation is still strong.

BBB Debt rated BBB exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances
are more likely to lead to a weakened capacity of the obligor
to meet its financial commitment on the obligation.

BB Debt rated BB is regarded as having significant speculative
characteristics although it is less vulnerable to nonpayment
than other speculative issues. However, it faces major ongoing
uncertainties or exposure to adverse business, financial or
economic conditions which could lead to the obligor's
inadequate capacity to meet its financial commitment on the
obligation.

Description of the three highest long-term debt ratings by Duff:

AAA Highest credit quality. The risk factors are negligible, being
only slightly more than for risk-free U.S. Treasury debt.

AA+ High credit quality. Protection factors are strong.
AA Risk is modest but may vary slightly from time to time
AA- because of economic conditions.

A+ Protection factors are average but adequate. However,
A risk factors are more variable and greater in periods
A- of economic stress.

B-42

<PAGE> 125

Description of the three highest long-term debt ratings by Fitch (plus (+) or
minus (-) signs are used with a rating symbol to indicate the relative position
of the credit within the rating category):

AAA Bonds considered to be investment grade and of the highest
credit quality. The obligor has an exceptionally strong
ability to pay interest and repay principal, which is unlikely
to be affected by reasonably foreseeable events.

AA Bonds considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and
repay principal is very strong, although not quite as strong
as bonds rated "AAA." Because bonds rated in the "AAA" and
"AA" categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these
issues is generally rated "F-1+."

A Bonds considered to be investment grade and of high credit
quality. The obligor's ability to pay interest and repay
principal is considered to be strong, but may be more
vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.

IBCA's description of its three highest long-term debt ratings:

AAA Obligations for which there is the lowest expectation of
investment risk. Capacity for timely repayment of principal
and interest is substantial, such that adverse changes in
business, economic or financial conditions are unlikely to
increase investment risk significantly.

AA Obligations for which there is a very low expectation of
investment risk. Capacity for timely repayment of principal
and interest is substantial. Adverse changes in business,
economic, or financial conditions may increase investment
risk, albeit not very significantly.

A Obligations for which there is a low expectation of investment
risk. Capacity for timely repayment of principal and interest
is strong, although adverse changes in business, economic or
financial conditions may lead to increased investment risk.

B-43

<PAGE> 126

SHORT-TERM DEBT RATINGS (may be assigned, for example, to commercial paper,
master demand notes, bank instruments, and letters of credit)

Moody's description of its three highest short-term debt ratings:

Prime-1 Issuers rated Prime-1 (or supporting institutions) have
a superior ability for repayment of senior short-term
debt obligations. Prime-1 repayment ability will often
be evidenced by many of the following characteristics:

- Leading market positions in well-established
industries.
- High rates of return on funds employed.
- Conservative capitalization structure with
moderate reliance on debt and ample asset
protection.
- Broad margins in earnings coverage of
fixed financial charges and high internal
cash generation.
- Well-established access to a range of
financial markets and assured sources of
alternate liquidity.

Prime-2 Issuers rated Prime-2 (or supporting institutions) have
a strong ability for repayment of senior short-term
debt obligations. This will normally be evidenced by
many of the characteristics cited above but to a lesser
degree. Earnings trends and coverage ratios, while
sound, may be more subject to variation. Capitalization
characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate
liquidity is maintained.

Prime-3 Issuers rated Prime-3 (or supporting institutions) have
an acceptable ability for repayment of senior
short-term obligations. The effect of industry
characteristics and market compositions may be more
pronounced. Variability in earnings and profitability
may result in changes in the level of debt protection
measurements and may require relatively high financial
leverage. Adequate alternate liquidity is maintained.

S&P's description of its three highest short-term debt ratings:

A-1 Highest category. The obligor's capacity to meet its financial
commitments is strong. Within this category, certain
obligations are designated with a plus sign (+). This
indicates that the obligor's capacity to meet its financial
commitments is extremely strong.

A-2 Obligations assigned this rating are somewhat more susceptible
to the adverse effects of changes in circumstances and
economic conditions than obligations in

B-44

<PAGE> 127

higher rating categories. However, the obligor's capacity to
meet its financial commitment on the obligation is
satisfactory.

A-3 Obligations assigned this rating exhibit adequate protection
parameters. However, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity
of the obligor to meet its financial commitment on the
obligation.

Duff's description of its five highest short-term debt ratings. Duff
incorporates gradations of "1+" (one plus) and "1-" (one minus) to assist
investors in recognizing quality differences within the highest rating category:

D-1+ Highest certainty of timely payment. Short-term liquidity,
including internal operating factors and/or access to
alternative sources of funds, is outstanding, and safety
is just below risk-free U.S. Treasury short-term
obligations.

D-1 Very high certainty of timely payment. Liquidity factors
are excellent and supported by good fundamental protection
factors. Risk factors are minor.

D-1- High certainty of timely payment. Liquidity factors are
strong and supported by good fundamental protection
factors. Risk factors are very small.

D-2 Good certainty of timely payment. Liquidity factors and
company fundamentals are sound. Although ongoing funding
needs may enlarge total financing requirements, access to
capital markets is good. Risk factors are small.

D-3 Satisfactory liquidity and other protection factors
qualify issues as to investment grade. Risk factors are
larger and subject to more variation.

Nevertheless, timely payment is expected.

Fitch's description of its four highest short-term debt ratings:

F-1+ Exceptionally Strong Credit Quality. Issues assigned this
rating are regarded as having the strongest degree of
assurance for timely payment.

F-1 Very Strong Credit Quality. Issues assigned this rating
reflect an assurance of timely payment only slightly less in
degree than issues rated F-1+.

F-2 Good Credit Quality. Issues assigned this rating have a
satisfactory degree of assurance for timely payment, but the
margin of safety is not as great as for issues assigned F-1+
or F-1 ratings.

B-45

<PAGE> 128

F-3 Fair Credit Quality. Issues assigned this rating have
characteristics suggesting that the degree of assurance for
timely payment is adequate; however, near-term adverse changes
could cause these securities to be rated below investment
grade.

IBCA's description of its three highest short-term debt ratings:

A1 Obligations supported by the highest capacity for timely
repayment. Where issues possess a particularly strong credit
feature, a rating of A1+ is assigned.

A2 Obligations supported by a satisfactory capacity for timely
repayment, although such capacity may be susceptible to
adverse changes in business, economic or financial conditions.

SHORT-TERM LOAN/MUNICIPAL NOTE RATINGS

Moody's description of its two highest short-term loan/municipal note ratings:

MIG 1/VMIG 1 This designation denotes best quality. There is
present strong protection by established cash flows,
superior liquidity support or demonstrated
broad-based access to the market for refinancing.

MIG 2/VMIG 2 This designation denotes high quality. Margins of
protection are ample although not so large as in the
preceding group.

S&P's description of its two highest municipal note ratings:

SP-1 Strong capacity to pay principal and interest. An issue
determined to possess a very strong capacity to pay debt
service is given a plus (+) designation.

SP-2 Satisfactory capacity to pay principal and interest, with
some vulnerability to adverse financial and economic
changes over the term of the notes.

SHORT-TERM DEBT RATINGS

Thomson BankWatch, Inc. ("TBW") ratings are based upon a qualitative and
quantitative analysis of all segments of the organization including, where
applicable, holding company and operating subsidiaries.

The TBW Short-Term Debt Ratings apply only to specific debt instruments with
original maturities of one year or less. TBW ratings represent an assessment of
the likelihood of an untimely payment of principal and interest. Important
factors that may influence this assessment are the overall financial health of
the particular company, and the probability that

B-46

<PAGE> 129

the government will come to the aid of a troubled institution in order to avoid
a default or failure.

The TBW Short-Term Ratings represent an assessment of the likelihood of an
untimely payment of principal or interest.

TBW-1 The highest category; indicates a very high likelihood
that principal and interest will be paid on a timely
basis.

TBW-2 The second-highest category; while the degree of safety
regarding timely repayment of principal and interest is
strong, the relative degree of safety is not as high as
for issues rated "TBW-1."

TBW-3 The lowest investment-grade category; indicates that while
the obligation is more susceptible to adverse developments
(both internal and external) than those with higher
ratings, the capacity to service principal and interest in
a timely fashion is considered adequate.

TBW-4 The lowest rating category; this rating is regarded as
non-investment grade and therefore speculative.

B-47

<PAGE> 130
PART C. OTHER INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements:

None

(b) Exhibits:

(1) Declaration of Trust, dated April 7, 1997, is filed
herewith.

(2) Form of By-Laws is filed herewith.

(3) None.

(4) None.

(5) None.

(6) None.

(7) None.

(8) None.

(9) None.

(10) [Draft] Opinion and Consent of Counsel as to legality
of shares being registered is filed herewith.

(11) Consent of Ropes & Gray, is filed herewith.

(12) None.

(13) None.

(14) None.

(15) None.

(16) None.

<PAGE> 131

(17) None.

(18) None.

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT

As of the date of this Registration
Statement, there are no persons controlled
by or under common control with the
Registrant.

ITEM 26. NUMBER OF HOLDERS OF SECURITIES

As of the date of this Registration
Statement, there was one (1) holder of
record of shares of beneficial interest of
the Registrant.

ITEM 27. INDEMNIFICATION

Article VIII of Registrant's Amended and Restated Agreement and
Declaration of Trust (Exhibit (1) hereto, which is incorporated herein by
reference) provides in effect that Registrant will indemnify its officers
and trustees against all liabilities and expenses, including but not
limited to amounts paid in satisfaction of judgments, in compromise, or
as fines and penalties, and counsel fees reasonably incurred by any such
officer or trustee in connection with the defense or disposition of any
action, suit, or other proceeding. However, in accordance with Section
17(h) and 17(i) of the 1940 Act and its own terms, said Agreement and
Declaration of Trust does not protect any person against any liability to
Registrant or its shareholders to which he or she would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his or her
office. In any event, Registrant will comply with 1940 Act Releases Nos.
7221 and 11330 respecting the permissible boundaries of indemnification
by an investment company of its officers and trustees.

Insofar as indemnification for liability arising under the
Securities Act of 1933, as amended (the "1933 Act"), may be permitted to
trustees, officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, Registrant has been advised that,
in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the 1933 Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
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,
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate

-2-

<PAGE> 132

jurisdiction the question whether such indemnification by it is against
public policy as expressed in the 1933 Act and will be governed by the
final adjudication of such issue.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISOR

Sanwa Bank California ("SBCL") performs investment advisory services
for Registrant. SBCL is a wholly owned subsidiary of The Sanwa Bank
Limited, of Japan. Its principal offices are located at 601 South
Figueroa Street, Los Angeles, California 90017. Established in 1972,
SBCL provides a full range of personal and business banking services
through a network of more than 100 branches and offices statewide.
SBCL has nearly [ ] of assets under management.

To the knowledge of Registrant, none of the directors or officers of
SBCL, except those set forth below, is or has been at any time during
the past two fiscal years engaged in any other business, profession,
vocation or employment of a substantial nature, except that certain
directors and officers of SBCL also hold positions with The Sanwa Bank
Limited, of Japan or its other subsidiaries.

Listed below are the directors and certain principal executive
officers of SBCL, their principal occupations and, for the prior two
fiscal years, any other business, profession, vocation, or employment
of a substantial nature engaged in by such directors and officers:

<TABLE>
<CAPTION>
NAME POSITION, BUSINESS, PROFESSION, VOCATION, OR EMPLOYMENT
- ---- -------------------------------------------------------
<S> <C>
Teruyoshi Yasufuku Chairman of the Board, SBCL; Counselor, Sanwa Research
Institute

Steven D. Broidy Director, SBCL; Vice Chairman and Chief Administrative Officer,
City National Bank

Robert C. Cooke Director, SBCL

Robert C. Corteway Director, SBCL

Vilma Martinez Director, SBCL; Litigation Partner, Munger, Tolles & Olson

James M. Rosser, Ph.D. Director, SBCL; President, California State University at
Los Angeles

Cynthia Ann Telles, Ph.D. Director, SBCL; Director, Spanish Speaking Psychosocial Clinic,
The Neuropsychiatric Institute and Hospital Department of
Psychiatry and Behavioral Sciences, UCLA School of Medicine

James C. Van Horne Director, SBCL; A.P. Gianniani Professor of Finance at the
Graduate School of Business at Stanford University

Tamio Takakura President and Chief Executive Officer, SBCL

Kazuyoshi Kuwahata Vice Chairman & Chief Line Officer, SBCL

Howard N. Gould Vice Chairman & Chief Administrative Officer; SBCL
</TABLE>

ITEM 29. PRINCIPAL UNDERWRITER

(a) BISYS Fund Services acts as distributor and administrator for the
Registrant. BISYS Fund Services also distributes the securities of
American Performance Funds, AmSouth Mutual Funds, The ARCH Fund, Inc.,
BB&T Mutual Funds Groups, The Coventry Group, Empire Builder Tax Free
Bond Fund, First Choice Funds Trust, Fountain Square Funds, Hirtle
Callaghan Trust, HSBC Family of Funds, The Infinity Mutual Funds, Inc.,
Intrust Funds, The Kent Funds, Magna Funds, MarketWatch Funds, Meyers
Sheppard Investment Trust, Minerva Funds, MMA Praxis Mutual Funds, The
M.S.D.&T Funds, Inc., Pacific Capital Funds, The Parkstone Group of
Funds, The Parkstone Advantage Funds, Pegasus Funds, Qualivest Funds, The

-3-

<PAGE> 133

Republic Funds Trust, The Republic Advisors Funds Trust, The Riverfront
Funds, Inc., SBSF Funds, Inc. dba Key Mutual Funds, Sefton Funds, The
Sessions Group, Summit Investment Trust, The Time Horizon Funds, Variable
Insurance Funds, and The Victory Portfolios, each of which is a
management investment company. The parent of BISYS Fund Services, Inc.
(the sole general partner of BISYS Fund Services) is The BISYS Group,
Inc.

(b) Partners of BISYS Fund Services as of the date of this Part C are as
follows:
<TABLE>
<CAPTION>

Positions and Positions and
Name and Principal Offices with The Offices with
Business Addresses Winsbury Company The Registrant
- ------------------ ---------------- --------------

<S> <C> <C>
The BISYS Group, Inc. Sole Shareholder None
150 Clove Road
Little Falls, NJ 07424

BISYS Fund Services, Inc. Sole General None
3435 Stelzer Road Partner
Columbus, OH 43219

WC Subsidiary Corporation Sole Limited Partner None
150 Clove Road
Little Falls, NJ 07424
</TABLE>

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS

(1) Sanwa Bank California, 601 S. Figueroa Street, Los Angeles,
California 90017 (records relating to the Advisor's
functions as investment adviser).

(2) BISYS Fund Services, Inc. 3435 Stelzer Road, Columbus, Ohio
43219 (records relating to its functions as administrator,
distributor, transfer agent, and fund accountant).

(3) ___________________. [Address] (records relating to its
function as custodian).

(4) Ropes & Gray, One Franklin Square, 1301 K Street, N.W.,
Suite 800 East, Washington, DC 20005 (the Registrant's
Declaration of Trust, By-Laws, and Minute Books).

-4-

<PAGE> 134

ITEM 31. MANAGEMENT SERVICES

None.

ITEM 32. UNDERTAKINGS

Registrant hereby undertakes to call a meeting of the shareholders for
the purpose of voting upon the question of removal of one or more
trustees when requested to do so by the holders of at least 10% of the
outstanding shares of Registrant and to comply with the provisions of
Section 16(c) of the Investment Company Act of 1940 relating to
shareholder communication.

Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest annual
report to shareholders, upon request and without charge.

Registrant hereby undertakes to file a post-effective amendment
including financial statements, which need not be audited, for each of
the Sanwa Prime Money Market Fund, the Sanwa U.S. Treasury Obligations
Fund, the Sanwa Investment Grade Bond Fund, the Sanwa Global Asset
Allocation Fund, and the Sanwa Equity Fund (each a "Fund"), within
four to six months of the commencement of that Fund's operations.

-5-

<PAGE> 135

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and
the Investment Company Act of 1940, the Registrant has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereto
duly authorized, in the City of Washington, D.C., on the 30th day of July,
1997.

Sanwa Mutual Funds Group

By: George O. Martinez*
------------------------------
George O. Martinez
Trustee

Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated:

Signature Capacity Date
- --------- -------- ----

George O. Martinez* Trustee July 30, 1997
- --------------------

*By: /s/ Brian L. Murray, Jr.
-------------------------
Brian L. Murray, Jr.
Attorney-In-Fact

-6-

<PAGE> 136

POWER OF ATTORNEY

The undersigned, being a Trustee of Sanwa Fund (the "Fund"), does
hereby constitute and appoint Martin E. Lybecker, Alan G. Priest and Brian L.
Murray, Jr. each individually, his true and lawful attorneys and agents, with
power of substitution or resubstitution, to do any and all acts and things and
to execute any and all instruments that said attorneys and agents, each
individually, may deem necessary or advisable or which may be required to enable
the Fund to comply with the Investment Company Act of 1940, as amended, and the
Securities Act of 1933, as amended ("Acts"), and any rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, and
in connection with the filing and effectiveness of any registration statement or
statement of the Fund pursuant to said Acts and any and all amendments thereto
(including post-effective amendments), including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as an officer of the Fund any and all such
amendments filed with the Securities and Exchange Commission under said Acts,
any Notification of Registration under the Investment Company Act of 1940 and
any other instruments or documents related thereto, and the undersigned does
hereby ratify and confirm all that said attorneys and agents, or either of them,
shall do or cause to be done by virtue thereof.

SIGNATURE CAPACITY DATE
- --------- -------- ----

/s/ George O. Martinez Trustee July 29, 1997
- --------------------------
George O. Martinez

<PAGE> 137

EXHIBIT INDEX

EXHIBIT NO. DESCRIPTION PAGE
- ----------- ----------- ----

(1) Declaration of Trust, dated April 7, 1997.

(2) Form of By-Laws.

(10) Opinion and Consent of Counsel as to legality of shares
being registered [draft].

(11) Consent of Ropes & Gray.

<PAGE> 1
EXHIBIT (1)
-----------

Declaration of Trust, dated April 7, 1997

<PAGE> 2

SANWA FUND

---------------

AGREEMENT AND DECLARATION OF TRUST

---------------

AGREEMENT AND DECLARATION OF TRUST made at Boston, Massachusetts on the
7th day of April, 1997, by the Trustees hereunder, and by the holders of
shares of beneficial interest to be issued hereunder as hereinafter provided.

WITNESSETH that

WHEREAS, this Trust has been formed to carry on the business of an
investment company; and

WHEREAS, the Trustees have agreed to manage all property coming into
their hands as trustees of a Massachusetts voluntary association with
transferable shares in accordance with the provisions hereinafter set forth.

NOW, THEREFORE, the Trustees hereby declare that they will hold all
cash, securities and other assets, which they may from time to time acquire in
any manner as Trustees hereunder IN TRUST to manage and dispose of the same upon
the following terms and conditions for the pro rata benefit of the holders from
time to time of Shares in this Trust as hereinafter set forth.

ARTICLE I

NAME AND DEFINITIONS

NAME
- ----

Section 1. This Trust shall be known as "Sanwa Fund", and the Trustees
shall conduct the business of the Trust under that name or any other name as
they may from time to time determine.

DEFINITIONS
- -----------

Section 2. Whenever used herein, unless otherwise required by the
context or specifically provided:

(a) The "Trust" refers to the Massachusetts business trust
established by this Agreement and Declaration of Trust, as amended from
time to time;

<PAGE> 3

(b) "Trustees" refers to the Trustees of the Trust named
herein or elected in accordance with Article IV;

(c) "Shares" means the equal proportionate transferable units
of interest into which the beneficial interest in the Trust shall be
divided from time to time or, if more than one series or classes of
Shares is authorized by the Trustees, the equal proportionate
transferable units into which the beneficial interest of each series or
classes of Shares shall be divided from time to time, and includes
fractions of Shares as well as whole Shares;

(d) "Shareholder" means a record owner of Shares;

(e) The "1940 Act" refers to the Investment Company Act of
1940 and the Rules and Regulations thereunder, all as amended from time
to time;

(f) The terms "Affiliated Person", "Assignment", "Commission",
"Interested Person", "Principal Underwriter" and "Majority Shareholder
Vote" (the 67% or 50% requirement of the third sentence of Section
2(a)(42) of the 1940 Act, whichever may be applicable) shall have the
meanings given them in the 1940 Act;

(g) "Declaration of Trust" shall mean this Agreement and
Declaration of Trust, as amended or restated from time to time; and

(h) "Bylaws" shall mean the Bylaws of the Trust, as amended
from time to time.

ARTICLE II
PURPOSE OF TRUST
----------------

The purpose of the Trust is to provide investors a managed investment
primarily in securities and debt instruments and to carry on such other business
as the Trustees may from time to time determine pursuant to their authority
under this Declaration of Trust.

ARTICLE III
SHARES
------

DIVISION OF BENEFICIAL INTERESTS
- --------------------------------

Section 1. The Shares of the Trust shall be issued in one or more
series as the Trustees may, without Shareholder approval, authorize. Each series
shall be preferred over all other series in respect of the assets allocated to
that series. Each series may be divided into two or more classes, as the
Trustees may, without Shareholder approval, authorize. The beneficial interest
in each series shall be divided into Shares, with a par value of $0.00001.
Unless the

-2-

<PAGE> 4

Trustees have authorized the issuance of Shares of a series in two or more
classes, each Share of a series shall represent an equal proportionate interest
in the series with each other Share of the same series, none having priority or
preference over another. If the Trustees have authorized the issuance of Shares
of a series in two or more classes, then the classes may have such variations as
to dividend, redemption, and voting rights, net asset values, expenses borne by
the classes, and other matters as the Trustees have authorized. The number of
Shares authorized shall be unlimited. The Trustees may from time to time divide
or combine the Shares of any series or of any class of a series into a greater
or lesser number without thereby changing the proportionate beneficial interests
in the series.

OWNERSHIP OF SHARES
- -------------------

Section 2. The ownership of Shares shall be recorded on the books of
the Trust or a transfer or similar agent. No certificates certifying the
ownership of Shares shall be issued except as the Trustees may otherwise
determine from time to time. The Trustees may make such rules as they consider
appropriate for the issuance of Share certificates, the transfer of Shares and
similar matters. The record books of the Trust as kept by the Trust or by any
transfer or similar agent, as the case may be, shall be conclusive as to who are
the Shareholders of each series and as to the number of Shares of each series
held from time to time by each Shareholder.

INVESTMENT IN THE TRUST
- -----------------------

Section 3. The Trustees shall accept investments in the Trust from such
persons and on such terms and for such consideration, which may consist of cash
or tangible or intangible property or a combination thereof, as they from time
to time authorize.

All consideration received by the Trust for the issue or sale of Shares
of each series, together with all income, earnings, profits, and proceeds
thereof, including any proceeds derived from the sale, exchange or liquidation
thereof, and any funds or payments derived from any reinvestment of such
proceeds in whatever form the same may be, shall irrevocably belong to the
series of Shares with respect to which the same were received by the Trust for
all purposes, subject only to the rights of creditors, and shall be so handled
upon the books of account of the Trust and are herein referred to as "assets of"
such series.

NO PREEMPTIVE RIGHTS
- --------------------

Section 4. Shares shall have no preemptive or other right to subscribe
to any additional Shares or other securities issued by the Trust.

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<PAGE> 5

STATUS OF SHARES AND LIMITATION OF PERSONAL LIABILITY
- -----------------------------------------------------

Section 5. Shares shall be deemed to be personal property giving only
the rights provided in this instrument. Every Shareholder by virtue of having
become a Shareholder shall be held to have expressly assented and agreed to the
terms hereof and to have become a party hereto. The death of a Shareholder
during the continuance of the Trust shall not operate to terminate the same nor
entitle the representative of any deceased Shareholder to an accounting or to
take any action in court or elsewhere against the Trust or the Trustees, but
only to the rights of said decedent under this Trust. Ownership of Shares shall
not entitle the Shareholder to any title in or to the whole or any part of the
Trust property or right to call for a partition or division of the same or for
an accounting, nor shall the ownership of Shares constitute the Shareholders
partners. Neither the Trust nor the Trustees, nor any officer, employee or agent
of the Trust shall have any power to bind personally any Shareholder, nor except
as specifically provided herein to call upon any Shareholder for the payment of
any sum of money or assessment whatsoever other than such as the Shareholder may
at any time personally agree to pay.

ARTICLE IV
THE TRUSTEES
------------

ELECTION
- --------

Section 1. The number of Trustees shall be as provided in the Bylaws or
as fixed from time to time by the Trustees. The Shareholders may elect Trustees
at any meeting of Shareholders called by the Trustees for that purpose. Each
Trustee shall serve during the continued lifetime of the Trust until he or she
dies, resigns or is removed, or, if sooner, until the next meeting of
Shareholders called for the purpose of electing Trustees and the election and
qualification of his or her successor. Any Trustee may resign at any time by
written instrument signed by him and delivered to any officer of the Trust, to
each other Trustee or to a meeting of the Trustees. Such resignation shall be
effective upon receipt unless specified to be effective at some other time.
Except to the extent expressly provided in a written agreement with the Trust,
no Trustee resigning and no Trustee removed shall have any right to any
compensation for any period following his or her resignation or removal, or any
right to damages on account of such removal.

EFFECT OF DEATH, RESIGNATION, ETC. OF A TRUSTEE
- -----------------------------------------------

Section 2. The death, declination, resignation, retirement, removal or
incapacity of the Trustees, or any one of them, shall not operate to annul the
Trust or to revoke any existing agency created pursuant to the terms of this
Declaration of Trust.

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<PAGE> 6

POWERS
- ------

Section 3. Subject to the provisions of this Declaration of Trust, the
business of the Trust shall be managed by the Trustees, and they shall have all
powers necessary or convenient to carry out that responsibility. Without
limiting the foregoing, the Trustees may adopt Bylaws not inconsistent with this
Declaration of Trust providing for the conduct of the business of the Trust and
may amend and repeal them to the extent that such Bylaws do not reserve that
right to the Shareholders; they may enlarge or reduce their number, may fill
vacancies in their number, including vacancies caused by enlargement of their
number, and may remove Trustees with or without cause; they may elect and
remove, with or without cause, such officers and appoint and terminate such
agents as they consider appropriate; they may appoint from their own number, and
terminate, any one or more committees consisting of two or more Trustees,
including an executive committee which may, when the Trustees are not in
session, exercise some or all of the power and authority of the Trustees as the
Trustees may determine; they may employ one or more custodians of the assets of
the Trust and may authorize such custodians to employ subcustodians and to
deposit all or any part of such assets in a system or systems for the central
handling of securities, retain a transfer agent or a Shareholder servicing
agent, or both, provide for the distribution of Shares by the Trust, through one
or more principal underwriters or otherwise, set record dates for the
determination of Shareholders with respect to various matters, and in general
delegate such authority as they consider desirable to any officer of the Trust,
to any committee of the Trustees and to any agent or employee of the Trust or to
any such custodian or underwriter.

Without limiting the foregoing, the Trustees shall have power and authority:

(a) To invest and reinvest cash, and to hold cash uninvested;

(b) To sell, exchange, lend, pledge, mortgage, hypothecate,
write options on and lease any or all of the assets of the Trust;

(d) To vote or give assent, or exercise any rights of
ownership, with respect to stock or other securities or property; and
to execute and deliver proxies or powers of attorney to such person or
persons as the Trustees shall deem proper, granting to such person or
persons such power and discretion with relation to securities or
property as the Trustees shall deem proper;

(e) To exercise powers and rights of subscription or otherwise
which in any manner arise out of ownership of securities;

-5-

<PAGE> 7

(f) To hold any security or property in a form not indicating
any trust, whether in bearer, unregistered or other negotiable form, or
in the name of the Trustees or of the Trust or in the name of a
custodian, subcustodian or other depository or a nominee or nominees or
otherwise;

(g) To allocate assets, liabilities and expenses of the Trust
to a particular series of Shares or to apportion the same among two or
more series, provided that any liabilities or expenses incurred by a
particular series of Shares shall be payable solely out of the assets
of that series;

(h) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or issuer,
any security of which is or was held in the Trust; to consent to any
contract, lease, mortgage, purchase or sale of property by such
corporation or issuer, and to pay calls or subscriptions with respect
to any security held in the Trust;

(i) To join with other security holders in acting through a
committee depositary, voting trustee or otherwise, and in that
connection to deposit any security with, or transfer any security to,
any such committee, depositary or trustee, and to delegate to them such
power and authority with relation to any security (whether or not so
deposited or transferred) as the Trustees shall deem proper, and to
agree to pay, and to pay, such portion of the expenses and compensation
of such committee, depositary or trustee as the Trustees shall deem
proper;

(j) To compromise, arbitrate or otherwise adjust claims in
favor of or against the Trust or any matter in controversy, including
but not limited to claims for taxes;

(k) To enter into joint ventures, general or limited
partnerships and any other combinations or associations;

(l) To borrow funds;

(m) To endorse or guarantee the payment of any notes or other
obligations of any person; to make contracts of guaranty or suretyship,
or otherwise assume liability for payment thereof; and to mortgage and
pledge the Trust property or any part thereof to secure any of or all
such obligations;

(n) To purchase and pay for entirely out of Trust property
such insurance as they may deem necessary or appropriate for the
conduct of the business, including without limitation, insurance
policies insuring the assets of the Trust and payment of distributions
and principal on its portfolio investments, and insurance policies
insuring the Shareholders, Trustees, officers, employees, agents,
investment advisers or managers, principal underwriters, or independent
contractors of the Trust individually

-6-

<PAGE> 8

against all claims and liabilities of every nature arising by reason of
holding, being or having held any such office or position, or by reason
of any action alleged to have been taken or omitted by any such person
as Shareholder, Trustee, officer, employee, agent, investment adviser
or manager, principal underwriter, or independent contractor, including
any action taken or omitted that may be determined to constitute
negligence, whether or not the Trust would have the power to indemnify
such person against such liability;

(o) To pay pensions for faithful service, as deemed
appropriate by the Trustees, and to adopt, establish and carry out
pension, profit-sharing, Share bonus, Share purchase, savings, thrift
and other retirement, incentive and benefit plans, trusts and
provisions, including the purchasing of life insurance and annuity
contracts as a means of providing such retirement and other benefits,
for any or all of the Trustees, officers, employees and agents of the
Trust; and

(p) To engage in any other lawful act or activity in which
corporations organized under the Massachusetts Business Corporation Law
may engage. The Trustees shall not in any way be bound or limited by
any present or future law or custom in regard to investments by
trustees.

Except as otherwise provided herein or from time to time in the Bylaws,
any action to be taken by the Trustees may be taken by a majority of the
Trustees present at a meeting of Trustees (a quorum being present), within or
without Massachusetts, including any meeting held by means of a conference
telephone or other communications equipment by means of which all persons
participating in the meeting can hear each other at the same time and
participation by such means shall constitute presence in person at a meeting, or
by written consents of a majority of the Trustees then in office.

PAYMENT OF EXPENSES BY TRUST
- ----------------------------

Section 4. The Trustees are authorized to pay or to cause to be paid
out of the principal or income of the Trust, or partly out of principal and
partly out of income, as they deem fair, all expenses, fees, charges, taxes and
liabilities incurred or arising in connection with the Trust, in connection with
the management thereof, or in connection with the financing of the sale of
Shares, including, but not limited to, the Trustees' compensation and such
expenses and charges for the services of the Trust's officers, employees, any
investment adviser, sub-adviser, principal underwriter, auditor, counsel,
custodian, sub-custodian, transfer agent, administrator, sub-administrator,
distributor, shareholder servicing agent, and such other agents or independent
contractors and such other expenses and charges as the Trustees may deem
necessary or proper to incur, provided, however, that all expenses, fees,
charges, taxes and liabilities incurred or arising in connection with a
particular series of Shares as determined by the Trustees, shall be payable
solely out of the assets of that series.

-7-

<PAGE> 9

OWNERSHIP OF ASSETS OF THE TRUST
- --------------------------------

Section 5. Title to all of the assets of each series of Shares and of
the Trust shall at all times be considered as vested in the Trustees.

ADVISORY, MANAGEMENT AND DISTRIBUTION
- -------------------------------------

Section 6. The Trustees may, at any time and from time to time,
contract for exclusive or nonexclusive advisory and/or management services with
any corporation, trust, association or other organization (the "Manager"), every
such contract to comply with such requirements and restrictions as may be set
forth in the Bylaws; and any such contract may provide for one or more
Sub-advisers who shall perform all or part of the obligations of the Manager
under such Contract and may contain such other terms interpretive of or in
addition to said requirements and restrictions as the Trustees may determine,
including, without limitation, authority to determine from time to time what
investments shall be purchased, held, sold or exchanged and what portion, if
any, of the assets of the Trust shall be held uninvested and to make changes in
the Trust's investments. The Trustees may also, at any time and from time to
time, contract with the Manager or any other corporation, trust, association or
other organization, appointing it exclusive or nonexclusive distributor or
principal underwriter for the Shares, every such contract to comply with such
requirements and restrictions as may be set forth in the Bylaws; and any such
contract may contain such other terms interpretive of or in addition to said
requirements and restrictions as the Trustees may determine.

The fact that:

(i) any of the Shareholders, Trustees or officers of the Trust
is a shareholder, director, officer, partner, trustee, employee,
manager, adviser, principal underwriter or distributor or agent of or
for any corporation, trust, association, or other organization, or of
or for any parent or affiliate of any organization, with which an
advisory or management contract, or principal underwriter's or
distributor's contract, or transfer, Shareholder servicing or other
agency contract may have been or may hereafter be made, or that any
such organization, or any parent or affiliate thereof, is a Shareholder
or has an interest in the Trust, or that

(ii) any corporation, trust, association or other organization
with which an advisory or management contract or principal
underwriter's or distributor's contract, or transfer, Shareholder
servicing or other agency contract may have been or may hereafter be
made also has an advisory or management contract, or principal
underwriter's or distributor's contract, or transfer, Shareholder
servicing or other agency contract with one or more other corporations,
trusts, associations, or other organizations, or has other business or
interests shall not affect the validity of any such contract or
disqualify any Shareholder, Trustee or officer of the Trust from voting

-8-

<PAGE> 10

upon or executing the same or create any liability or accountability to
the Trust or its Shareholders.

ARTICLE V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
----------------------------------------

Shareholders shall have such power to vote as is provided for in, and
may hold meetings and take actions pursuant to the provisions of the Bylaws.

ARTICLE VI
DISTRIBUTIONS, REDEMPTIONS AND REPURCHASES
------------------------------------------

DISTRIBUTIONS
- -------------

Section 1. The Trustees may each year, or more frequently if they so
determine, distribute to the Shareholders of each series such income and capital
gains, accrued or realized, as the Trustees may determine, after providing for
actual and accrued expenses and liabilities (including such reserves as the
Trustees may establish) determined in accordance with good accounting practices.
The Trustees shall have full discretion to determine which items shall be
treated as income and which items as capital and their determination shall be
binding upon the Shareholders. Distributions of each year's income of each
series shall be distributed pro rata to Shareholders in proportion to the number
of Shares of each series held by each of them. Such distributions shall be made
in cash or Shares or a combination thereof as determined by the Trustees. Any
such distribution paid in Shares will be paid at the net asset value thereof as
determined in accordance with the Bylaws.

REDEMPTIONS AND REPURCHASES
- ---------------------------

Section 2. The Trust shall purchase such Shares as are offered by any
Shareholder for redemption, upon the presentation of any certificate for the
Shares to be purchased, a proper instrument of transfer and a request directed
to the Trust or a person designated by the Trust that the Trust purchase such
Shares, or in accordance with such other procedures for redemption as the
Trustees may from time to time authorize; and the Trust will pay therefor the
net asset value thereof, as next determined in accordance with the Bylaws, less
such redemption charge or fee as the Trustees may determine from time to time.
Payment for said Shares shall be made by the Trust to the Shareholder within
seven days after the date on which the request is made. The obligation set forth
in this Section 2 is subject to the provision that in the event that any time
the New York Stock Exchange is closed for other than customary weekends or
holidays, or, if permitted by rules of the Commission, during periods when
trading on the Exchange is restricted or during any emergency which makes it
impractical for the Trust to dispose of its investments or to determine fairly
the value of its net assets, or during any other period permitted by order of
the Commission for the protection of investors, such obligation may be suspended
or postponed by the Trustees. The Trust may also

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<PAGE> 11

purchase or repurchase Shares at a price not exceeding the net asset value of
such Shares in effect when the purchase or repurchase or any contract to
purchase or repurchase is made. The Trust may refuse to honor a request by a
Shareholder for redemption of his or her Shares for a specified time after such
Shareholder's purchase of such Shares, such specified time, if any, to be set
forth in the Bylaws.

REDEMPTIONS AT THE OPTION OF THE TRUST
- --------------------------------------

Section 3. The Trust shall have the right at its option and at any time
to redeem Shares of any Shareholder at the net asset value thereof as determined
in accordance with the Bylaws: (i) if at such time such Shareholder owns fewer
Shares than, or Shares having an aggregate net asset value of less than, an
amount determined from time to time by the Trustees; or (ii) to the extent that
such Shareholder owns Shares of a particular series of Shares equal to or in
excess of a percentage of the outstanding Shares of that series determined from
time to time by the Trustees; or (iii) to the extent that such Shareholder owns
Shares of the Trust representing a percentage equal to or in excess of such
percentage of the aggregate number of outstanding Shares of the Trust or the
aggregate net asset value of the Trust determined from time to time by the
Trustees. In addition, if the Net Income of any series of Shares of the Trust
which uses the amortized cost method of valuation pursuant to the 1940 Act is
determined at any time to be a negative amount, then, with respect to a
Shareholder owning Shares of such series, such Shareholder's pro rata share of
such negative amount shall constitute a liability of such Shareholder to the
Trust which shall be paid at such times and in such manner as the Trustees may
from time to time determine out of such Shareholder's accrued dividend account
in such series or otherwise. As used in this Article VI, Section 3, "Net Income"
shall mean all interest income accrued on portfolio investments of the series
plus or minus realized or unrealized gains and losses on portfolio investments
of the series, less all actual and accrued expenses and liabilities determined
in according with generally accepted accounting practices. Determination of Net
Income of a series made by the Trustees, or as they may authorize, in good
faith, shall be binding on all parties concerned.

DIVIDENDS, DISTRIBUTIONS, REDEMPTIONS AND REPURCHASES
- -----------------------------------------------------

Section 4. No dividend or distribution (including, without limitation,
any distribution paid upon termination of the Trust or of any series) with
respect to, nor any redemption or repurchase of, the Shares of any series shall
be effected by the Trust other than from the assets of such series.

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<PAGE> 12

ARTICLE VII
COMPENSATION AND LIMITATION OF LIABILITY OF TRUSTEES
----------------------------------------------------

COMPENSATION
- ------------

Section 1. The Trustees as such shall be entitled to reasonable
compensation from the Trust; they may fix the amount of their compensation.
Nothing herein shall in any way prevent the employment of any Trustee for
advisory, management, legal, accounting, investment banking, underwriting,
brokerage, or investment dealer or other services and payment for the same by
the Trust.

LIMITATION OF LIABILITY
- -----------------------

Section 2. The Trustees shall not be responsible or liable in any event
for any neglect or wrongdoing of any officer, agent, employee, manager or
principal underwriter of the Trust, nor shall any Trustee be responsible for the
act or omission of any other Trustee, but nothing herein contained shall protect
any Trustee against any liability to which he or she would otherwise be subject
by reason of wilful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his or her office.

Every note, bond, contract, instrument, certificate or undertaking and
every other act or thing whatsoever executed or done by or on behalf of the
Trust or the Trustees or any of them in connection with the Trust shall be
conclusively deemed to have been executed or done only in or with respect to
their or his or her capacity as Trustees or Trustee, and such Trustees or
Trustee shall not be personally liable thereon.

ARTICLE VIII
INDEMNIFICATION
---------------

TRUSTEES, OFFICERS, ETC.
- ------------------------

Section 1. The Trust shall indemnify each of its Trustees and officers
(including persons who serve at the Trust's request as directors, officers or
trustees of another organization in which the Trust has any interest as a
shareholder, creditor or otherwise) (hereinafter referred to as a "Covered
Person") against all liabilities and expenses, including but not limited to
amounts paid in satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees reasonably incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such Covered Person may be or may have
been threatened, while in office or thereafter, by reason of being or having
been such a Covered Person except with respect to any matter as to which such
Covered Person shall have been finally adjudicated in any such action, suit or
other proceeding to be liable to the Trust or

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<PAGE> 13

its Shareholders by reason of wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such Covered
Person's office. Expenses, including counsel fees so incurred by any such
Covered Person (but excluding amounts paid in satisfaction of judgments, in
compromise or as fines or penalties), shall be paid from time to time by the
Trust in advance of the final disposition of any such action, suit or proceeding
upon receipt of an undertaking by or on behalf of such Covered Person to repay
amounts so paid to the Trust if it is ultimately determined that indemnification
of such expenses is not authorized under this Article, provided, however, that
either (a) such Covered Person shall have provided appropriate security for such
undertaking, (b) the Trust shall be insured against losses arising from any such
advance payments or (c) either a majority of the disinterested Trustees acting
on the matter (provided that a majority of the disinterested Trustees then in
office act on the matter), or independent legal counsel in a written opinion,
shall have determined, based upon a review of readily available facts (as
opposed to a full trial type inquiry) that there is reason to believe that such
Covered Person will be found entitled to indemnification under this Article.

COMPROMISE PAYMENT
- ------------------

Section 2. As to any matter disposed of (whether by a compromise
payment, pursuant to a consent decree or otherwise) without an adjudication by a
court, or by any other body before which the proceeding was brought, that such
Covered Person either (a) did not act in good faith in the reasonable belief
that his or her action was in the best interests of the Trust or (b) is liable
to the Trust or its Shareholders by reason of wilful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his or her office, indemnification shall be provided if (a) approved as in the
best interests of the Trust, after notice that it involves such indemnification,
by at least a majority of the disinterested Trustees acting on the matter
(provided that a majority of the disinterested Trustees then in office act on
the matter) upon a determination, based upon a review of readily available facts
(as opposed to a full trial type inquiry) that such Covered Person acted in good
faith in the reasonable belief that his or her action was in the best interests
of the Trust and is not liable to the Trust or its Shareholders by reasons of
wilful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his or her office, or (b) there has been
obtained an opinion in writing of independent legal counsel, based upon a review
of readily available facts (as opposed to a full trial type inquiry) to the
effect that such Covered Person appears to have acted in good faith in the
reasonable belief that his or her action was in the best interests of the Trust
and that such indemnification would not protect such Person against any
liability to the Trust to which he or she would otherwise be subject by reason
of wilful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his or her office. Any approval pursuant to
this Section shall not prevent the recovery from any Covered Person of any
amount paid to such Covered Person in accordance with this Section as
indemnification if such Covered Person is subsequently adjudicated by a court of
competent jurisdiction not to have acted in good faith in the reasonable belief
that such Covered Person's action was in the best interests of the Trust or to
have been liable to the

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<PAGE> 14

Trust or its Shareholders by reason of wilful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of such
Covered Person's office.

INDEMNIFICATION NOT EXCLUSIVE
- -----------------------------

Section 3. The right of indemnification hereby provided shall not be
exclusive of or affect any other rights to which such Covered Person may be
entitled. As used in this Article VIII, the term "Covered Person" shall include
such person's heirs, executors and administrators and a "disinterested Trustee"
is a Trustee who is not an "interested person" of the Trust as defined in
Section 2(a)(19) of the 1940 Act (or who has been exempted from being an
"interested person" by any rule, regulation or order of the Commission) and
against whom none of such actions, suits or other proceedings or another action,
suit or other proceeding on the same or similar grounds is then or has been
pending. Nothing contained in this Article shall affect any rights to
indemnification to which personnel of the Trust, other than Trustees or
officers, and other persons may be entitled by contract or otherwise under law,
nor the power of the Trust to purchase and maintain liability insurance on
behalf of any such person; provided, however, that the Trust shall not purchase
or maintain any such liability insurance in contravention of applicable law,
including without limitation the 1940 Act.

SHAREHOLDERS
- ------------

Section 4. In case any Shareholder or former Shareholder shall be held
to be personally liable solely by reason of his or her being or having been a
Shareholder and not because of his or her acts or omissions or for some other
reason, the Shareholder or former Shareholder (or his or her heirs, executors,
administrators or other legal representatives or in the case of a corporation or
other entity, its corporate or other general successor) shall be entitled to be
held harmless from and indemnified against all loss and expense arising from
such liability, but only out of the assets of the particular series of Shares of
which he or she is or was a Shareholder.

ARTICLE IX
MISCELLANEOUS
-------------

TRUSTEES, SHAREHOLDERS, ETC. NOT PERSONALLY LIABLE; NOTICE
- ----------------------------------------------------------

Section 1. All persons extending credit to, contracting with or having
any claim against the Trust or a particular series of Shares shall look only to
the assets of the Trust or the assets of that particular series of Shares for
payment under such credit, contract or claim; and neither the Shareholders nor
the Trustees, nor any of the Trust's officers, employees or agents, whether
past, present or future, shall be personally liable therefor. Nothing in this
Declaration of Trust shall protect any Trustee against any liability to which
such Trustee would otherwise be subject by reason of wilful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of the office of Trustee.

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<PAGE> 15

Every note, bond, contract, instrument, certificate or undertaking made
or issued by the Trustees or by any officer or officers shall give notice that
this Declaration of Trust is on file with the Secretary of The Commonwealth of
Massachusetts and shall recite that the same was executed or made by or on
behalf of the Trust or by them as Trustee or Trustees or as officer or officers
and not individually and that the obligations of such instrument are not binding
upon any of them or the Shareholders individually but are binding only upon the
assets and property of the Trust, and may contain such further recital as he or
she or they may deem appropriate, but the omission thereof shall not operate to
bind any Trustee or Trustees or officer or officers or Shareholder or
Shareholders individually.

TRUSTEE'S GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR SURETY
- -------------------------------------------------------------

Section 2. The exercise by the Trustees of their powers and discretion
hereunder shall be binding upon everyone interested. A Trustee shall be liable
for his or her own wilful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the office of Trustee, and
for nothing else, and shall not be liable for errors of judgment or mistakes of
fact or law. The Trustees may take advice of counsel or other experts with
respect to the meaning and operation of this Declaration of Trust, and shall be
under no liability for any act or omission in accordance with such advice or for
failing to follow such advice. Except as may be required by applicable law,
including, without limitation, the 1940 Act, the Trustees shall not be required
to give any bond as such, nor any surety if a bond is required.

LIABILITY OF THIRD PERSONS DEALING WITH TRUSTEES
- ------------------------------------------------

Section 3. No person dealing with the Trustees shall be bound to make
any inquiry concerning the validity of any transaction made or to be made by the
Trustees or to see to the application of any payments made or property
transferred to the Trust or upon its order.

DURATION AND TERMINATION OF TRUST
- ---------------------------------

Section 4. Unless terminated as provided herein, the Trust shall
continue without limitation of time. The Trust may be terminated at any time by
the vote of Shareholders holding at least a majority of the Shares of each
series entitled to vote or by the Trustees by written notice to the
Shareholders. Any series of Shares may be terminated at any time by vote of
Shareholders holding at least a majority of the Shares of such series entitled
to vote or by the Trustees by written notice to the Shareholders of such series.

Upon termination of the Trust or of any one or more series of Shares,
after paying or otherwise providing for all charges, taxes, expenses and
liabilities, whether due or accrued or anticipated, of the Trust or of the
particular series as may be determined by the Trustees, the Trust shall, in
accordance with such procedures as the Trustees consider appropriate, reduce the
remaining assets to distributable form in cash or shares or other securities, or
any

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<PAGE> 16

combination thereof, and distribute the proceeds to the Shareholders of the
series involved, ratably according to the number of Shares of such series held
by the several Shareholders of such series on the date of termination.

FILING OF COPIES, REFERENCES, HEADINGS
- --------------------------------------

Section 5. The original or a copy of this instrument and of each
amendment hereto shall be kept at the office of the Trust where it may be
inspected by any Shareholder. A copy of this instrument and of each amendment
hereto shall be filed by the Trust with the Secretary of The Commonwealth of
Massachusetts and with the Boston City Clerk, as well as any other governmental
office where such filing may from time to time be required. Anyone dealing with
the Trust may rely on a certificate by an officer of the Trust as to whether or
not any such amendments have been made and as to any matters in connection with
the Trust hereunder, and, with the same effect as if it were the original, may
rely on a copy certified by an officer of the Trust to be a copy of this
instrument or of any such amendments. In this instrument and in any such
amendment, references to this instrument, and all expressions like "herein",
"hereof" and "hereunder" shall be deemed to refer to this instrument as amended
or affected by any such amendments. Headings are placed herein for convenience
of reference only and shall not be taken as a part hereof or control or affect
the meaning, construction or effect of this instrument. This instrument may be
executed in any number of counterparts each of which shall be deemed an
original.

APPLICABLE LAW
- --------------

Section 6. This Declaration of Trust is made in The Commonwealth of
Massachusetts, and it is created under and is to be governed by and construed
and administered according to the laws of said Commonwealth. The Trust shall be
of the type commonly called a Massachusetts business trust, and without limiting
the provisions hereof, the Trust may exercise all powers which are ordinarily
exercised by such a trust.

AMENDMENTS
- ----------

Section 7. This Declaration of Trust may be amended at any time by an
instrument in writing signed by a majority of the then Trustees when authorized
to do so by vote of Shareholders holding a majority of the Shares of each series
entitled to vote, except that an amendment which shall affect the holders of one
or more series of Shares but not the holders of all outstanding series shall be
authorized by vote of the Shareholders holding a majority of the Shares entitled
to vote of each series affected and no vote of Shareholders of a series not
affected shall be required. Amendments having the purpose of changing the name
of the Trust, of establishing, changing, or eliminating the par value of the
Shares or of supplying any omission, curing any ambiguity or curing, correcting
or supplementing any defective or inconsistent provision contained herein shall
not require authorization by Shareholder vote.

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<PAGE> 17

IN WITNESS WHEREOF, the undersigned has executed this Agreement and
Declaration of Trust as Trustee and not individually, as of the 7th day of
April, 1997.

/s/ George O. Martinez
------------------------------
George O. Martinez
Trustee

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<PAGE> 18

COUNTY OF SUFFOLK :
: ss
COMMONWEALTH OF MASSACHUSETTS :

On this 7th day of April, 1997, George O. Martinez, known to me and
known to be the individual described herein and who executed the foregoing
instrument, before me and acknowledged the foregoing instrument to be his free
act and deed.

/s/ Sherri L. Conte
--------------------------------
Notary Public

[Notary's Seal] My Commission Expires: 12/23/99
----------

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<PAGE> 1

EXHIBIT (2)
-----------

Form of By-Laws

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<PAGE> 2

FORM OF
BYLAWS
OF
SANWA FUNDS

ARTICLE 1
Agreement and Declaration of Trust and Principal Office

1.1 AGREEMENT AND DECLARATION OF TRUST. These Bylaws shall be subject
to the Agreement and Declaration of Trust, as from time to time in effect (the
"Declaration of Trust"), of Sanwa Funds, the Massachusetts business trust
established by the Declaration of Trust (the "Trust").

1.2 RESIDENT AGENT OF THE TRUST. The Trust shall have an agent for
service of process residing in The Commonwealth of Massachusetts.

1.3 PRINCIPAL OFFICE OF THE TRUST. The initial principal office of the
Trust shall be located in Columbus, Ohio. The Trust may have such other offices
as the Trustees may determine or as they may authorize.

ARTICLE 2
Meetings of Trustees

2.1 REGULAR MEETINGS. Regular meetings of the Trustees may be held
without call or notice at such places and at such times as the Trustees may from
time to time determine, provided that notice of the first regular meeting
following any such determination shall be given to absent Trustees. A regular
meeting of the Trustees may be held without call or notice immediately after and
at the same place as an annual meeting of the shareholders.

2.2 SPECIAL MEETINGS. Special meetings of the Trustees may be held at
any time and at any place designated in the call of the meeting when called by
the Chairman of the Trustees, the President or the Treasurer or by two or more
Trustees, sufficient notice thereof being given to each Trustee by the Secretary
or an Assistant Secretary or by the officer or the Trustees calling the meeting.

2.3 NOTICE. It shall be sufficient notice to the Trustee of a special
meeting to send notice by mail or special delivery at least forty-eight hours or
by telegram, telex or telecopy or other electronic facsimile transmission method
at least twenty-four hours before the meeting addressed to the Trustee at his or
her usual or last known business or residence address or to give notice to him
or her in person or by telephone at least twenty-four hours before the meeting.
Notice of a meeting need not be given to any Trustee if a written waiver of
notice, executed by him or her before the meeting, is filed with the records of
the meeting, or to any

<PAGE> 3

Trustee who attends the meeting without protesting prior thereto or at its
commencement the lack of notice to him or her. Neither notice of a meeting nor a
waiver of a notice need specify the purposes of the meeting.

2.4 QUORUM. At any meeting of the Trustees a majority of the Trustees
then in office shall constitute a quorum. Any meeting may be adjourned from time
to time by a majority of the votes cast upon the question, whether or not a
quorum is present, and the meeting may be held as adjourned without further
notice.

ARTICLE 3
Officers

3.1 ENUMERATION: QUALIFICATION. The officers of the Trust shall be a
President, a Treasurer, and a Secretary who shall also be the Clerk, and such
other officers including a Chairman of the Board of Trustees, if any, as the
Trustees from time to time may in their discretion elect. The Trust may also
have such agents as the Trustees from time to time may in their discretion
appoint. The Chairman of the Board of Trustees, if one is elected, shall be a
Trustee and may but need not be a shareholder; and any other officer may but not
need be a Trustee or a shareholder. Any two or more offices may be held by the
same person.

3.2 ELECTION. The President, the Treasurer, and the Secretary shall be
elected annually by the Trustees. Other officers, if any, may be elected or
appointed by the Trustees at any time. Vacancies in any office may be filled at
any time.

3.3 TENURE. The Chairman of the Trustees, if one is elected, the
President, the Treasurer and the Secretary shall hold office until their
respective successors are chosen and qualified, or in each case until he or she
sooner dies, resigns, is removed or becomes disqualified. Each other officer
shall hold office and each agent shall retain authority at the pleasure of the
Trustees.

3.4 POWERS. Subject to the other provisions of these Bylaws, each
officer shall have, in addition to the duties and powers herein and as set forth
in the Declaration of Trust, such duties and powers as are commonly incident to
the office occupied by him or her as if the Trust were organized as a
Massachusetts business corporation and such other duties and powers as the
Trustees may designate from time to time.

3.5 CHAIRMAN; PRESIDENT. Unless the Trustees otherwise provide, the
Chairman of the Trustees or, if there is none or in the absence of the Chairman,
the President shall preside at all meetings of the shareholders and of the
Trustees. The President shall be the chief executive officer.

3.6 TREASURER. Unless otherwise provided by the Trustees, the Treasurer
shall be the chief financial and accounting officer of the Trust, and shall,
subject to the provisions of

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<PAGE> 4

the Declaration of Trust and to any arrangement made by the Trustees with a
custodian, investment adviser or manager, or transfer, shareholder servicing or
similar agent, be in charge of the valuable papers, books of account and
accounting records of the Trust, and shall have such other duties and powers as
may be designated from time to time by the Trustees or by the President.

3.7 SECRETARY. The Secretary shall record all proceedings of the
shareholders and the Trustees in books to be kept therefor, which books or a
copy thereof shall be kept at the principal office of the Trust. In the absence
of the Secretary from any meeting of the shareholders or Trustees, an assistant
secretary, or if there be none or if he or she is absent, a temporary secretary
chosen at such meeting shall record the proceedings thereof in the aforesaid
books.

3.8 RESIGNATIONS. Any officer may resign at any time by written
instrument signed by him or her and delivered to the Chairman, the President or
the Secretary or to a meeting of the Trustees. Such resignation shall be
effective upon receipt unless specified to be effective at some other time.
Except to the extent expressly provided in a written agreement with the Trust,
no officer resigning and no officer removed shall have any right to any
compensation for any period following his or her resignation or removal, or any
right to damages on account of such removal.

ARTICLE 4
Committees

4.1 QUORUM; VOTING. A majority of the members of any Committee of the
Trustees shall constitute a quorum for the transaction of business, and any
action of such a Committee may be taken at a meeting by a vote of a majority of
the members present (a quorum being present) or evidenced by one or more
writings signed by such a majority. Members of a Committee may participate in a
meeting of such Committee by means of a conference telephone or other
communications equipment by means of which all persons participating in the
meeting can hear each other at the same time and participation by such means
shall constitute presence in person at a meeting.

ARTICLE 5
Reports

5.1 GENERAL. The Trustees and officers shall render reports at the time
and in the manner required by the Declaration of Trust or any applicable law.
Officers and Committees shall render such additional reports as they may deem
desirable or as may from time to time be required by the Trustees.

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<PAGE> 5

ARTICLE 6
Fiscal Year

6.1 GENERAL. Except as from time to time otherwise provided by the
Trustees, the initial fiscal year of the Trust shall end on such date as is
determined in advance or in arrears by the Treasurer, and subsequent fiscal
years shall end on such date in subsequent years.

ARTICLE 7
Seal

7.1 GENERAL. At the discretion of the Trustees, the Trust may have a
seal. The seal of the Trust, if any, shall consist of a flat-faced die with the
word "Massachusetts", together with the name of the Trust and the year of its
organization cut or engraved thereon but, unless otherwise required by the
Trustees, the seal shall not be necessary to be placed on, and its absence shall
not impair the validity of, any document, instrument or other paper executed and
delivered by or on behalf of the Trust.

ARTICLE 8
Execution of Papers

8.1 GENERAL. Except as the Trustees may generally or in particular
cases authorize the execution thereof in some other manner, all deeds, leases,
contracts, notes and other obligations made by the Trustees shall be signed by
the President or by the Treasurer and need not bear the seal of the Trust.

ARTICLE 9
Issuance of Share Certificates

9.1 SHARE CERTIFICATES. In lieu of issuing certificates for shares, the
Trustees or the transfer agent may either issue receipts therefor or may keep
accounts upon the books of the Trust for the record holders of such shares, who
shall in either case be deemed, for all purposes hereunder, to be the holders of
certificates for such shares as if they had accepted such certificates and shall
be held to have expressly assented and agreed to the terms hereof.

The Trustees may at any time authorize the issuance of share
certificates. In that event, each shareholder shall be entitled to a certificate
stating the number of shares owned by him, in such form as shall be prescribed
from time to time by the Trustees. Such certificates shall be signed by the
President or any Vice-President and by the Treasurer or Assistant Treasurer.
Such signatures may be facsimile if the certificate is signed by a transfer
agent, or by a registrar, other than a Trustee, officer or employee of the
Trust. In case any officer who has signed or whose facsimile signature has been
placed on such certificate shall cease to be such officer before such
certificate is issued, it may be issued by the Trust with the same effect as if
he were such officer at the time of its issue.

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<PAGE> 6

9.2 LOSS OF CERTIFICATES. In case of the alleged loss or destruction or
the mutilation of a share certificate, a duplicate certificate may be issued in
place thereof, upon such terms as the Trustees shall prescribe.

9.3 ISSUANCE OF NEW CERTIFICATES TO PLEDGEE. A pledgee of shares
transferred as collateral security shall be entitled to a new certificate if the
instrument of transfer substantially describes the debt or duty that is intended
to be secured thereby. Such new certificates shall express on its face that it
is held as collateral security, and the name of the pledgor shall be stated
thereon, who alone shall be liable as a shareholder and entitled to vote
thereon.

9.4 DISCONTINUANCE OF ISSUANCE OF CERTIFICATES. The Trustees may at any
time discontinue the issuance of share certificates and may, by written notice
to each shareholder, require the surrender of share certificates to the Trust
for cancellation. Such surrender and cancellation shall not effect the ownership
of shares in the Trust.

ARTICLE 10
Provisions Relating to the Conduct of the Trust's Business

10.1 CONDUCT OF BUSINESS. The Trust shall at all times conduct its
business in accordance with applicable provisions of the Investment Company Act
of 1940 (the "1940 Act"). The Trustees shall adopt valuation guidelines or
procedures consistent with the applicable provisions of the 1940 Act regarding
the valuation of the Shares of each series or class of the Trust.

ARTICLE 11
Shareholders' Voting Powers and Meetings

11.1 VOTING POWERS. The Shareholders shall have power to vote only (i)
for the election of Trustees as provided in Article IV, Section 1 of the
Declaration of Trust, PROVIDED, HOWEVER, that no meeting of Shareholders is
required to be called for the purpose of electing Trustees unless and until such
time as less than a majority of the Trustees have been elected by the
Shareholders, (ii) with respect to any Manager or Sub-Adviser as provided in
Article IV, Section 6 of the Declaration of Trust to the extent required by the
1940 Act, (iii) with respect to any termination of this Trust to the extent and
as provided in Article IX, Section 4 of the Declaration of Trust, (iv) with
respect to any amendment of the Declaration of Trust to the extent and as
provided in Article IX, Section 7 of the Declaration of Trust, (v) to the same
extent as the stockholders of a Massachusetts business corporation as to whether
or not a court action, proceeding or claim should or should not be brought or
maintained derivatively or as a class action on behalf of the Trust or the
Shareholders, and (vi) with respect to such additional matters relating to the
Trust as may be required by law, the Declaration of Trust, these Bylaws or any
registration of the Trust with the Commission (or any successor agency) or any
state, or as the Trustees may consider necessary or desirable. Shareholders
holding at least 10% of

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<PAGE> 7

the Trust's Shares shall have the right to call a meeting to elect or remove one
or more of the Trustees of the Trust. Removal of one or more Trustees by
Shareholder vote may be accomplished without a showing of cause. Each whole
Share shall be entitled to one vote as to any matter on which it is entitled to
vote and each fractional Share shall be entitled to a proportionate fractional
vote. The Shareholders of any particular series or class shall not be entitled
to vote on any matters as to which such series or class is not affected. Except
with respect to matters as to which the Trustees have determined that only the
interests of one or more particular series are affected or as required by law,
all of the Shares of each series or class shall, on matters as to which it is
entitled to vote, vote with other series so entitled as a single class.
Notwithstanding the foregoing, with respect to matters which would otherwise be
voted on by two or more series as a single class, the Trustees may, in their
sole discretion, submit such matters to the Shareholders of any or all such
series, separately. There shall be no cumulative voting in the election of
Trustees. Shares may be voted in person or by proxy. A proxy with respect to
Shares held in the name of two or more persons shall be valid if executed by any
one of them unless at or prior to exercise of the proxy the Trust receives a
specific written notice to the contrary from any one of them. A proxy purporting
to be executed by or on behalf of a Shareholder shall be deemed valid unless
challenged at or prior to its exercise and the burden of proving invalidity
shall rest on the challenger. Until Shares are issued, the Trustees may exercise
all rights of Shareholders and may take any action required by law, the
Declaration of Trust or these Bylaws to be taken by shareholders.

11.2 VOTING POWER AND MEETINGS. Meetings of the Shareholders may be
called by the Trustees for the purpose of electing Trustees as provided in
Article IV, Section 1 of the Declaration of Trust and for such other purposes as
may be prescribed by law, by the Declaration of Trust or by these Bylaws.
Meetings of the Shareholders may also be called by the Trustees from time to
time for the purpose of taking action upon any other matter deemed by the
Trustees to be necessary or desirable. A meeting of Shareholders may be held at
any place designated by the Trustees. Written notice of any meeting of
Shareholders shall be given or caused to be given by the Trustees by mailing
such notice at least seven days before such meeting, postage prepaid, stating
the time and place of the meeting, to each Shareholder at the Shareholder's
address as it appears on the records of the Trust. Whenever notice of a meeting
is required to be given to a Shareholder under the Declaration of Trust or these
Bylaws, a written waiver thereof, executed before or after the meeting by such
Shareholder or his attorney thereunto authorized and filed with the records of
the meeting, shall be deemed equivalent to such notice.

11.3 QUORUM AND REQUIRED VOTE. A majority of Shares entitled to vote
shall be a quorum for the transaction of business at a Shareholders' meeting,
except that where any provision of law or of the Declaration of Trust or these
Bylaws permits or requires that holders of any series shall vote as a series,
then a majority of the aggregate number of Shares of that series entitled to
vote shall be necessary to constitute a quorum for the transaction of business
by that series. Any lesser number shall be sufficient for adjournments. Any
adjourned session or sessions may be held, within a reasonable time after the
date set for the

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<PAGE> 8

original meeting, without the necessity of further notice. Except when a larger
vote is required by any provision of law or the Declaration of Trust or these
Bylaws, a majority of the Shares voted shall decide any questions and a
plurality shall elect a Trustee, provided that where any provision of law or of
the Declaration of Trust or these Bylaws permits or requires that the holders of
any series shall vote as a series, then a majority of the Shares of that series
voted on the matter (or a plurality with respect to the election of a Trustee)
shall decide that matter insofar as that series is concerned.

11.4 ACTION BY WRITTEN CONSENT. Any action taken by Shareholders may be
taken without a meeting if a majority of Shareholders entitled to vote on the
matter (or such larger proportion thereof as shall be required by any express
provision of law or the Declaration of Trust or these Bylaws) consent to the
action in writing and such written consents are filed with the records of the
meetings of Shareholders. Such consent shall be treated for all purposes as a
vote taken at a meeting of Shareholders.

11.5 RECORD DATES. For the purpose of determining the shareholders who
are entitled to vote or act at any meeting or any adjournment thereof, or who
are entitled to receive payment of any dividend or of any other distribution,
the Trustees may from time to time fix a time, which shall be not more than 90
days before the date of any meeting of shareholders or the date for the payment
of any dividend or of any other distribution, as the record date for determining
the shareholders having the right to notice of and to vote at such meeting and
any adjournment thereof or the right to receive such dividend or distribution,
and in such case only shareholders of record on such record date shall have such
right notwithstanding any transfer of shares on the books of the Trust after the
record date; or without fixing such record date the Trustees may for any of such
purposes close the register or transfer books for all or any part of such
period.

ARTICLE 12
Amendments to the Bylaws

12.1 GENERAL. These Bylaws may be amended or repealed, in whole or in
part, by a majority of the Trustees then in office at any meeting of the
Trustees, or by one or more writings signed by such a majority.

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<PAGE> 1

EXHIBIT (10)
------------

Opinion and Consent of Counsel
as to legality of shares being registered

-8-

<PAGE> 2

[ROPES & GRAY LETTERHEAD]

WRITER'S DIRECT DIAL NUMBER: (202) 626-3907

[Date]

Sanwa Fund
3534 Stelzer Road
Columbus, Ohio 43219

Ladies and Gentlemen:

You have informed us that you propose to register under the Securities
Act of 1933, as amended (the "1933 Act") and offer and sell from time to time
shares of beneficial interest of Sanwa Fund ("Shares"), $0.00001 par value per
share, at not less than "net asset value" as defined in your By-Laws.

We have examined your Agreement and Declaration of Trust on file in the
office of the Secretary of The Commonwealth of Massachusetts and the Clerk of
the City of Boston and are familiar with the action taken by your Trustee to
authorize the issue and sale of certain Shares to BISYS Fund Services, Inc
("BISYS"). We have also examined a certificate of your treasurer of even date
herewith setting forth that as of the date hereof [20,000] Shares of the Sanwa
Prime Money Market Fund, [20,000] Shares of the Sanwa U.S. Treasury Obligations
Fund, [20,000] Shares of the Sanwa Investment Grade Bond Fund, [20,000] Shares
of the Sanwa Global Asset Allocation Fund, and [20,000] Shares of the Sanwa
Equity Fund, have been issued and are outstanding, such Shares having been
purchased by BISYS for aggregate cash consideration of $100,000. We have also
examined a copy of your Bylaws and such other documents, receipts and records as
we have deemed necessary for the purpose of this opinion.

Based upon the foregoing, we are of the opinion that:

1. The beneficial interest in the Sanwa Fund is divided into an
unlimited number of shares of beneficial interest, $0.00001 par value per share.

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<PAGE> 3

Sanwa Fund
[Date]
Page 2

2. The issue and sale of the authorized but unissued Shares of the
Sanwa Prime Money Market Fund, the Sanwa U.S. Treasury Obligations Fund, the
Sanwa Investment Grade Bond Fund, the Sanwa Global Asset Allocation Fund, and
the Sanwa Equity Fund have been duly authorized under Massachusetts law. Under
the original issue and sale of your authorized but unissued Shares and upon
receipt of the authorized consideration therefor in an amount not less than the
net asset value of the Shares established and in force at the time of their
sale, the Shares issued will be validly issued, fully paid and nonassessable.

3. The Shares issued and sold to BISYS aforesaid have been validly
issued and are fully paid and nonassessable.

The Sanwa Fund is an entity of the type commonly known as a
"Massachusetts business trust." Under Massachusetts law, shareholders could,
under certain circumstances, be held personally liable for the obligations of
the Trust. However, the Agreement and Declaration of Trust provides for
indemnification out of the property of a particular series of Shares for all
loss and expenses of any shareholder of that series held personally liable
solely by reason of his being or having been a shareholder. Thus, the risk of
shareholder liability is limited to circumstances in which that series of Shares
itself would be unable to meet its obligations.

We understand that this opinion is to be used in connection with
registering an indefinite number of Shares of beneficial interest of the Sanwa
Fund for offering and sale pursuant to the 1933 Act. We consent to the filing of
this opinion with and as part of your Registration Statement on Form N-1A (File
No. __________) relating to such offer and sale.

Very truly yours,

Ropes & Gray

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<PAGE> 1

EXHIBIT (11)
------------

Consent of Ropes & Gray

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<PAGE> 2

CONSENT OF COUNSEL
------------------

We hereby consent to the use of our name and the references to our firm
under the caption "Legal Counsel" included in or made a part of the Registration
Statement of Sanwa Fund on Form N-1A under the Securities Act of 1933, as
amended.

Ropes & Gray

Washington, D.C.

July 30, 1997

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