<PAGE>
FORUM FUNDS
MAINE MUNICIPAL BOND FUND
Supplement to Prospectus Dated August 1, 1996
1. The following sentence relating to the Fund's maximum sales charge is added
to the third paragraph on the first page of the Prospectus:
During the period January 15, 1997 through March 31, 1997, Shares of the Fund
will be subject to a maximum sales charge of 2.50% of the total public offering
price (2.56% of the net amount invested).
2. The following paragraph relating to the Fund's sales charges is added after
the last full paragraph on page 14 of the Prospectus:
During the period of January 15, 1997 through March 31, 1997, an adjusted sales
charge will be in effect, assessed as follows:
SALES CHARGE AS
A % OF
-----------------------------------
AMOUNT OF PURCHASE PUBLIC OFFERING NET ASSET VALUE DEALERS'
PRICE REALLOWANCE
Less than $50,000 2.50% 2.56% 2.50%
$50,000 but less than
$100,000 2.25% 2.30% 2.25%
$100,000 but less than
$500,000 2.00% 2.04% 2.00%
$500,000 but less than
$1,000,000 1.50% 1.52% 1.50%
$1,000,000 or greater 0.50% 0.50% 0.50%
After March 31, 1997, the sales charges and dealers' reallowance set forth in
the table on page 14 of the Prospectus will be reinstated.
January 15, 1997
<PAGE>
FORUM FUNDS
NEW HAMPSHIRE BOND FUND
Supplement to Prospectus Dated August 1, 1996
1. The following sentence relating to the Fund's maximum sales charge is added
to the third paragraph on the first page of the Prospectus:
During the period January 15, 1997 through March 31, 1997, Shares of the Fund
will be subject to a maximum sales charge of 2.50% of the total public offering
price (2.56% of the net amount invested).
2. The following paragraph relating to the Fund's sales charges is added before
the last full paragraph on page 14 of the Prospectus:
During the period of January 15, 1997 through March 31, 1997, an adjusted sales
charge will be in effect, assessed as follows:
SALES CHARGE AS
A % OF
-----------------------------------
AMOUNT OF PURCHASE PUBLIC OFFERING NET ASSET VALUE DEALERS'
PRICE REALLOWANCE
Less than $50,000 2.50% 2.56% 2.50%
$50,000 but less than
$100,000 2.25% 2.30% 2.25%
$100,000 but less than
$500,000 2.00% 2.04% 2.00%
$500,000 but less than
$1,000,000 1.50% 1.52% 1.50%
$1,000,000 or greater 0.50% 0.50% 0.50%
After March 31, 1997, the sales charges and dealers' reallowance set forth in
the table on page 14 of the Prospectus will be reinstated.
January 15, 1997
<PAGE>
FORUM FUNDS
MAINE MUNICIPAL BOND FUND
Supplement to Statement of Additional Information Dated August 1, 1996
The following paragraph relating to the method of computing the offering price
of the Fund's shares is added to Section 7 "Additional Purchase and Redemption
Information" after the third paragraph in that section:
As set forth in the Prospectus, for the period January 15, 1997 through March
31, 1997, an adjusted sales charge schedule is in effect. Set forth below is an
example of the method of computing the offering price of the Fund's shares for
that period only. Assuming a purchase of shares aggregating less than $100,000
subject to the adjusted sales charge schedule at a price based on the net asset
value per share on March 31, 1996 of $10.72, the offering price of the Fund's
shares is computed as follows:
Net Asset Value Per Share. . . . . . . . . . . . . $ 10.72
Sales Charge, 2.50% of offering price
(2.56% of net asset value per share) . . . . . . . $ 0.27
Offering to Public . . . . . . . . . . . . . . . . $ 10.99
After March 31, 1997, the sales charge schedule set forth on page 14 of the
Prospectus will be reinstated.
January 15, 1997
<PAGE>
FORUM FUNDS
NEW HAMPSHIRE BOND FUND
Supplement to Statement of Additional Information Dated August 1, 1996
The following paragraph relating to the method of computing the offering price
of the Fund's shares is added to Section 7 "Additional Purchase and Redemption
Information" after the third paragraph in that section:
As set forth in the Prospectus, for the period January 15, 1997 through March
31, 1997, an adjusted sales charge schedule is in effect. Set forth below is an
example of the method of computing the offering price of the Fund's shares for
that period only. Assuming a purchase of shares aggregating less than $100,000
subject to the adjusted sales charge schedule at a price based on the net asset
value per share on March 31, 1996 of $10.33, the offering price of the Fund's
shares is computed as follows:
Net Asset Value Per Share. . . . . . . . . . . . . $ 10.33
Sales Charge, 2.50% of offering price
(2.56% of net asset value per share) . . . . . . . $ 0.26
Offering to Public . . . . . . . . . . . . . . . . $ 10.59
After March 31, 1997, the sales charge schedule set forth on page 14 of the
Prospectus will be reinstated.
January 15, 1997
