FIRST AMERICAN FUNDS, INC.
PRIME OBLIGATIONS FUND
CLASS A, CLASS B AND CLASS C
Supplement Dated April 1, 2000,
To Prospectus Dated December 1, 1999
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Replace the "Fees and Expenses" table on page 5 of the prospectus with the "Fees
and Expenses" table below. The advisor is reducing the fee waiver for the
current fiscal year.
FIRST AMERICAN FUNDS, INC.
PRIME OBLIGATIONS FUND
CLASS A, CLASS B AND CLASS C SHARES
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FEES AND EXPENSES
As an investor, you pay fees and expenses to buy and hold shares of the fund.
You pay shareholder fees directly when you buy or sell shares. You pay annual
fund operating expenses indirectly since they are deducted from fund assets. The
figures below are based on fund expenses during the fiscal year ended September
30, 1999.(1)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
- -----------------------------------------------------------------------------------------
SHAREHOLDER FEES
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<S> <C> <C> <C>
MAXIMUM SALES CHARGE (LOAD) None None None
MAXIMUM DEFERRED SALES CHARGE (LOAD) None 5.00%(2) 1.00%(2)
ANNUAL MAINTENANCE FEE(3)
ONLY CHARGED TO ACCOUNTS WITH BALANCES BELOW $500 $25 $25 $25
ANNUAL FUND OPERATING EXPENSES AS A % OF AVERAGE NET ASSETS
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Management Fees 0.40% 0.40% 0.40%
Distribution and Service (12b-1) Fees 0.25% 1.00% 1.00%
Other Expenses 0.22% 0.11% 0.11%
TOTAL 0.87% 1.51% 1.51%
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</TABLE>
(1) Actual expenses for the fiscal year were lower than those shown in the table
because of voluntary fee waivers by the advisor. See "Additional Information
-- Financial Highlights" for effective management fees after waivers. The
net expenses the fund actually paid after waivers for the fiscal year ended
September 30, 1999, were:
<TABLE>
<S> <C> <C> <C>
Waiver of Fund Expenses (0.07)% (0.06)% (0.06)%
TOTAL ACTUAL ANNUAL OPERATING EXPENSES (AFTER WAIVERS) 0.80% 1.45% 1.45%
</TABLE>
THE ADVISOR INTENDS TO WAIVE FEES DURING THE CURRENT FISCAL YEAR SO THAT TOTAL
FUND OPERATING EXPENSES DO NOT EXCEED 0.84%, 1.48% AND 1.48%, RESPECTIVELY, FOR
CLASS A, CLASS B AND CLASS C SHARES. FEE WAIVERS MAY BE DISCONTINUED AT ANY
TIME.
(2) Class B and Class C shares generally are available only in exchange for
Class B or Class C shares, respectively, of another First American fund. The
contingent deferred sales charge imposed when you sell your Class B or Class
C shares of Prime Obligations Fund will be based on the date you purchased
shares of the original First American fund.
(3) The Fund reserves the right to charge your account an annual maintenance fee
of $25 if your balance falls below $500 as a result of selling or exchanging
shares. See "Policies & Services -- Selling Shares, Accounts with Low
Balances."
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EXAMPLE This example is intended to help you compare the cost of investing in
the fund with the cost of investing in other mutual funds. It assumes that you
invest $10,000 for the time periods indicated, that your investment has a 5%
return each year, and that the fund's operating expenses remain the same.
Although your actual costs and returns may differ, based on these assumptions
your costs would be:
<TABLE>
<CAPTION>
CLASS B CLASS B CLASS C CLASS C
assuming redemption assuming no redemption assuming redemption assuming no redemption
CLASS A at end of each period at end of each period at end of each period at end of each period
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 year $ 89 $ 654 $ 154 $ 352 $ 252
3 years $ 278 $ 877 $ 477 $ 572 $ 572
5 years $ 482 $1,024 $ 824 $ 915 $ 915
10 years $1,073 $1,629 $1,629 $1,884 $1,884
</TABLE>
