<PAGE>
PaineWebber RMA
Money Market Portfolio
U.S. Government Portfolio
Tax-Free Fund
California Municipal Money Fund
New Jersey Municipal Money Fund
New York Municipal Money Fund
------------------------------------
PROSPECTUS
AUGUST 31, 1999
------------------------------------
This prospectus offers shares of these money market funds primarily to
participants in the PaineWebber Resource Management Account'r' (RMA'r') Program,
the PaineWebber Business Services Account'sm' (BSA'sm') Program and certain
PaineWebber advisory programs.
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved the funds' shares or determined whether this prospectus
is complete or accurate. To state otherwise is a crime.
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Funds
Contents
THE FUNDS
<TABLE>
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------------
What every investor 3 Money Market Portfolio
should know about 6 U.S. Government Portfolio
the funds 9 Tax-Free Fund
12 California Municipal Money Fund
15 New Jersey Municipal Money Fund
18 New York Municipal Money Fund
21 More About Risks and
Investment Strategies
YOUR INVESTMENT
- ---------------------------------------------------------------------------------------------------------
Information for 23 Managing Your Fund Account
managing your fund -- Buying Shares
account -- Selling Shares
-- Pricing and Valuation
ADDITIONAL INFORMATION
- ---------------------------------------------------------------------------------------------------------
Additional important 26 Management
information about 27 Dividends and Taxes
the funds 28 Financial Highlights
- ---------------------------------------------------------------------------------------------------------
Where to learn more Back Cover
about the funds
</TABLE>
-----------------------------------
The funds are not complete or
balanced investment programs.
-----------------------------------
===========
- --------------------------------------------------------------------------------
2
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Money Market Portfolio
Money Market Portfolio
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Maximum current income consistent with liquidity and conservation of capital.
PRINCIPAL INVESTMENT STRATEGIES
The fund is a money market fund and seeks to maintain a stable price of $1.00
per share. The fund invests in a diversified portfolio of high quality money
market instruments of governmental and private issuers.
Money market instruments are short-term debt obligations and similar securities.
They also include longer term bonds that have variable interest rates or other
special features that give them the financial characteristics of short-term
debt. The fund invests in foreign money market instruments only if they are
denominated in U.S. dollars.
PaineWebber Incorporated, the fund's investment adviser, has appointed Mitchell
Hutchins Asset Management Inc. to serve as the fund's sub-adviser. Mitchell
Hutchins selects money market instruments for the fund based on its assessment
of relative values and changes in market and economic conditions.
PRINCIPAL RISKS
An investment in the fund is not a bank deposit and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. While the fund seeks to maintain the value of your investment at $1.00
per share, it is possible to lose money by investing in the fund.
Money market instruments generally have a low risk of loss, but they are not
risk-free. The fund is subject to credit risk, which is the risk that issuers
may fail, or become less able, to make payments when due. The fund also is
subject to interest rate risk. When short-term interest rates rise, the value of
the fund's investments generally will fall, and its yield will tend to lag
behind prevailing rates.
More information about these and other risks of an investment in the fund is
provided below in 'More About Risks and Investment Strategies.' In particular,
see the following headings:
Credit Risk
Interest Rate Risk
Foreign Securities Risk
Information on the fund's recent holdings can be found in its current
annual/semi-annual reports (see back cover for information on ordering those
reports).
===========
- --------------------------------------------------------------------------------
3
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Money Market Portfolio
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
table that follows the bar chart shows the average annual returns over several
time periods for the fund's shares.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN
<TABLE>
<CAPTION>
PERCENTAGES
-----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
9.01% 8.01% 5.90% 3.56% 2.84% 3.78% 5.54% 5.02% 5.15% 5.09%
<CAPTION>
CALENDAR YEAR
-------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
</TABLE>
Total return January 1 to June 30, 1999 -- 2.22%
Best quarter during years shown: 2nd quarter, 1989 -- 2.33%
Worst quarter during years shown: 2nd quarter, 1993 -- 0.69%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1998
<TABLE>
<S> <C>
One Year................................................ 5.09%
Five Years.............................................. 4.92%
Ten Years............................................... 5.38%
</TABLE>
===========
- --------------------------------------------------------------------------------
4
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Money Market Portfolio
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investment)
<TABLE>
<S> <C>
Maximum Sales Charge (Load) Imposed on Purchases (as a % of
offering price)............................................. None
Maximum Contingent Deferred Sales Charge (Load) (as a % of
offering price)............................................. None
Maximum Account Fee*
PaineWebber RMA Program................................... $ 85
PaineWebber BSA Program................................... $125
</TABLE>
- ------------
* Additional fees may apply for optional RMA/BSA services, such as a Bank One
Line of Credit for MasterCard'r' transactions.
<TABLE>
<S> <C>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted
from fund assets)
Management Fees............................................. 0.50%
Distribution and/or Service (12b-1) Fees.................... None
Other Expenses.............................................. 0.09%
----
Total Annual Fund Operating Expenses........................ 0.59%
----
----
</TABLE>
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.
This example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C>
$60 $189 $329 $738
</TABLE>
===========
- --------------------------------------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA U.S. Government Portfolio
U.S. Government Portfolio
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Maximum current income consistent with liquidity and conservation of capital.
PRINCIPAL INVESTMENT STRATEGIES
The fund is a money market fund and seeks to maintain a stable price of $1.00
per share. The fund invests in a diversified portfolio of high quality, U.S.
government money market instruments.
Money market instruments are short-term debt obligations and similar securities.
They also include longer term bonds that have variable interest rates or other
special features that give them the financial characteristics of short-term
debt. The fund invests in money market instruments that are backed by the full
faith and credit of the United States and in repurchase agreements relating to
those U.S. government obligations.
PaineWebber Incorporated, the fund's investment adviser, has appointed Mitchell
Hutchins Asset Management Inc. to serve as the fund's sub-adviser. Mitchell
Hutchins selects money market instruments for the fund based on its assessment
of relative values and changes in market and economic conditions.
PRINCIPAL RISKS
An investment in the fund is not a bank deposit and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. While the fund seeks to maintain the value of your investment at $1.00
per share, it is possible to lose money by investing in the fund.
Money market instruments generally have a low risk of loss, but they are not
risk-free. The fund is subject to credit risk, which is the risk that issuers
may fail, or become less able, to make payments when due. The fund also is
subject to interest rate risk. When short-term interest rates rise, the value of
the fund's investments generally will fall, and its yield will tend to lag
behind prevailing rates.
More information about these and other risks of an investment in the fund is
provided below in 'More About Risks and Investment Strategies.' In particular,
see the following headings:
Credit Risk
Interest Rate Risk
Information on the fund's recent holdings can be found in its current
annual/semi-annual reports (see back cover for information on ordering those
reports).
===========
- --------------------------------------------------------------------------------
6
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA U.S. Government Portfolio
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
table that follows the bar chart shows the average annual returns over several
time periods for the fund's shares.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN
<TABLE>
<CAPTION>
PERCENTAGES
-----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
8.49% 7.62% 5.57% 3.41% 2.64% 3.52% 5.24% 4.86% 5.01% 4.85%
<CAPTION>
CALENDAR YEAR
-------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
</TABLE>
Total return January 1 to June 30, 1999 -- 2.07%
Best quarter during years shown: 2nd quarter, 1989 -- 2.18%
Worst quarter during years shown: 4th quarter, 1993 -- 0.65%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1998
<TABLE>
<S> <C>
One Year................................................ 4.85%
Five Years.............................................. 4.69%
Ten Years............................................... 5.11%
</TABLE>
===========
- --------------------------------------------------------------------------------
7
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA U.S. Government Portfolio
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investment)
<TABLE>
<S> <C>
Maximum Sales Charge (Load) Imposed on Purchases (as a % of
offering price)............................................. None
Maximum Contingent Deferred Sales Charge (Load) (as a % of
offering price)............................................. None
Maximum Account Fee*
PaineWebber RMA Program................................... $85
PaineWebber BSA Program................................... $125
</TABLE>
- ------------
* Additional fees may apply for optional RMA/BSA services, such as a Bank One
Line of Credit for MasterCard'r' transactions.
<TABLE>
<S> <C>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted
from fund assets)
Management Fees............................................. 0.42%
Distribution and/or Service (12b-1) Fees.................... 0.13%*
Other Expenses.............................................. 0.05%
----
Total Annual Fund Operating Expenses........................ 0.60%
----
----
</TABLE>
- ------------
* The current rate is 0.125% but has been rounded to 0.13% for purposes of the
table.
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.
This example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C>
$61 $192 $335 $750
</TABLE>
===========
- --------------------------------------------------------------------------------
8
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Tax-Free Fund
Tax-Free Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Maximum current income exempt from federal income tax consistent with liquidity
and conservation of capital.
PRINCIPAL INVESTMENT STRATEGIES
The fund is a money market fund and seeks to maintain a stable price of $1.00
per share. The fund invests in a diversified portfolio of high quality,
municipal money market instruments.
Money market instruments are short-term debt obligations and similar securities.
They also include longer term bonds that have variable interest rates or other
special features that give them the financial characteristics of short-term
debt. The fund invests in money market instruments that are exempt from federal
income tax. While the fund normally does not do so, it may invest up to 20% of
its total assets in securities that are subject to the federal alternative
minimum tax.
PaineWebber Incorporated, the fund's investment adviser, has appointed Mitchell
Hutchins Asset Management Inc. to serve as the fund's sub-adviser. Mitchell
Hutchins selects money market instruments for the fund based on its assessment
of relative values and changes in market and economic conditions.
PRINCIPAL RISKS
An investment in the fund is not a bank deposit and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. While the fund seeks to maintain the value of your investment at $1.00
per share, it is possible to lose money by investing in the fund.
Money market instruments generally have a low risk of loss, but they are not
risk-free. The fund is subject to credit risk, which is the risk that issuers
may fail, or become less able, to make payments when due. The fund also is
subject to interest rate risk. When short-term interest rates rise, the value of
the fund's investments generally will fall, and its yield will tend to lag
behind prevailing rates.
More information about these and other risks of an investment in the fund is
provided below in 'More About Risks and Investment Strategies.' In particular,
see the following headings:
Credit Risk
Interest Rate Risk
Information on the fund's recent holdings can be found in its current
annual/semi-annual reports (see back cover for information on ordering those
reports).
===========
- --------------------------------------------------------------------------------
9
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Tax-Free Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
table that follows the bar chart shows the average annual returns over several
time periods for the fund's shares.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN
<TABLE>
<CAPTION>
PERCENTAGES
-----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
5.78% 5.38% 4.06% 2.58% 1.86% 2.31% 3.32% 2.92% 3.10% 2.93%
<CAPTION>
CALENDAR YEAR
-------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
</TABLE>
Total return January 1 to June 30, 1999 -- 1.24%
Best quarter during years shown: 2nd quarter, 1989 -- 1.52%
Worst quarter during years shown: 1st quarter, 1994 -- 0.44%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1998
<TABLE>
<S> <C>
One Year................................................ 2.93%
Five Years.............................................. 2.92%
Ten Years............................................... 3.42%
</TABLE>
===========
- --------------------------------------------------------------------------------
10
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Tax-Free Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investment)
<TABLE>
<S> <C>
Maximum Sales Charge (Load) Imposed on Purchases (as a % of
offering price)............................................. None
Maximum Contingent Deferred Sales Charge (Load) (as a % of
offering price)............................................. None
Maximum Account Fee*
PaineWebber RMA Program................................... $ 85
PaineWebber BSA Program................................... $125
</TABLE>
- ------------
* Additional fees may apply for optional RMA/BSA services, such as a Bank One
Line of Credit for MasterCard'r' transactions.
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from fund assets)
<TABLE>
<S> <C>
Management Fees............................................. 0.43%
Distribution and/or Service (12b-1) Fees.................... 0.13%*
Other Expenses.............................................. 0.03%
-----
Total Annual Fund Operating Expenses........................ 0.59%
-----
-----
</TABLE>
- ------------
* The current rate is 0.125% but has been rounded to 0.13% for purposes of the
table.
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.
This example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C>
$60 $189 $329 $738
</TABLE>
===========
- --------------------------------------------------------------------------------
11
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA California Municipal Money Fund
California Municipal Money Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Maximum current income exempt from federal income tax and California personal
income tax consistent with liquidity and conservation of capital.
PRINCIPAL INVESTMENT STRATEGIES
The fund is a money market fund and seeks to maintain a stable price of $1.00
per share. The fund invests in a diversified portfolio of high quality money
market instruments that are exempt from both federal income tax and California
personal income tax.
Money market instruments are short-term debt obligations and similar securities.
They also include longer term bonds that have variable interest rates or other
special features that give them the financial characteristics of short-term
debt. While the fund normally does not do so, it may invest without limit in
instruments that are subject to the federal alternative minimum tax.
PaineWebber Incorporated, the fund's investment adviser, has appointed Mitchell
Hutchins Asset Management Inc. to serve as the fund's sub-adviser. Mitchell
Hutchins selects money market instruments for the fund based on its assessment
of relative values and changes in market and economic conditions.
PRINCIPAL RISKS
An investment in the fund is not a bank deposit and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. While the fund seeks to maintain the value of your investment at $1.00
per share, it is possible to lose money by investing in the fund.
Money market instruments generally have a low risk of loss, but they are not
risk-free. The fund is subject to credit risk, which is the risk that issuers
may fail, or become less able, to make payments when due. The fund also is
subject to interest rate risk. When short-term interest rates rise, the value of
the fund's investments generally will fall, and its yield will tend to lag
behind prevailing rates.
More information about these and other risks of an investment in the fund is
provided below in 'More About Risks and Investment Strategies.' In particular,
see the following headings:
Credit Risk
Interest Rate Risk
Single State Concentration Risk
Related Securities Concentration Risk
Information on the fund's recent holdings can be found in its current
annual/semi-annual reports (see back cover for information on ordering those
reports).
===========
- --------------------------------------------------------------------------------
12
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA California Municipal Money Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
table that follows the bar chart shows the average annual returns over several
time periods for the fund's shares.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN
<TABLE>
<CAPTION>
PERCENTAGES
-----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
5.57% 5.04% 3.74% 2.34% 1.77% 2.20% 3.14% 2.80% 2.93% 2.58%
<CAPTION>
CALENDAR YEAR
-------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
</TABLE>
Total return January 1 to June 30, 1999 -- 1.10%
Best quarter during years shown: 2nd quarter, 1989 -- 1.46%
Worst quarter during years shown: 1st quarter, 1994 -- 0.42%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1998
<TABLE>
<S> <C>
One Year................................................ 2.58%
Five Years.............................................. 2.73%
Ten Years............................................... 3.21%
</TABLE>
===========
- --------------------------------------------------------------------------------
13
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA California Municipal Money Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investment)
<TABLE>
<S> <C>
Maximum Sales Charge (Load) Imposed on Purchases (as a % of
offering price)............................................. None
Maximum Contingent Deferred Sales Charge (Load) (as a % of
offering price)............................................. None
Maximum Account Fee*
PaineWebber RMA Program................................... $ 85
PaineWebber BSA Program................................... $125
</TABLE>
- ------------
* Additional fees may apply for optional RMA/BSA services, such as a Bank One
Line of Credit for MasterCard'r' transactions.
<TABLE>
<S> <C>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted
from fund assets)
Management Fees............................................. 0.47%
Distribution and/or Service (12b-1) Fees.................... 0.13%*
Other Expenses.............................................. 0.07%
----
Total Annual Fund Operating Expenses........................ 0.67%
----
----
</TABLE>
- ------------
* The current rate is 0.125% but has been rounded to 0.13% for purposes of the
table.
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.
This example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C>
$68 $214 $373 $835
</TABLE>
===========
- --------------------------------------------------------------------------------
14
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA New Jersey Municipal Money Fund
New Jersey Municipal Money Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Maximization of current income exempt from federal income tax and New Jersey
personal income tax for residents of the State of New Jersey, consistent with
the preservation of capital and the maintenance of liquidity.
PRINCIPAL INVESTMENT STRATEGIES
The fund is a money market fund and seeks to maintain a stable price of $1.00
per share. The fund invests in a diversified portfolio of high quality money
market instruments that are exempt from both federal income tax and New Jersey
personal income tax.
Money market instruments are short-term debt obligations and similar securities.
They also include longer term bonds that have variable interest rates or other
special features that give them the financial characteristics of short-term
debt. The fund may invest without limit in instruments that are subject to the
federal alternative minimum tax.
PaineWebber Incorporated, the fund's investment adviser, has appointed Mitchell
Hutchins Asset Management Inc. to serve as the fund's sub-adviser. Mitchell
Hutchins selects money market instruments for the fund based on its assessment
of relative values and changes in market and economic conditions.
PRINCIPAL RISKS
An investment in the fund is not a bank deposit and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. While the fund seeks to maintain the value of your investment at $1.00
per share, it is possible to lose money by investing in the fund.
Money market instruments generally have a low risk of loss, but they are not
risk-free. The fund is subject to credit risk, which is the risk that issuers
may fail, or become less able, to make payments when due. The fund also is
subject to interest rate risk. When short-term interest rates rise, the value of
the fund's investments generally will fall, and its yield will tend to lag
behind prevailing rates.
More information about these and other risks of an investment in the fund is
provided below in 'More About Risks and Investment Strategies.' In particular,
see the following headings:
Credit Risk
Interest Rate Risk
Single State Concentration Risk
Related Securities Concentration Risk
Information on the fund's recent holdings can be found in its current
annual/semi-annual reports (see back cover for information on ordering those
reports).
===========
- --------------------------------------------------------------------------------
15
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA New Jersey Municipal Money Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
table that follows the bar chart shows the average annual returns over several
time periods for the fund's shares.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN (1992 IS THE FUND'S FIRST FULL CALENDAR YEAR OF OPERATIONS.)
<TABLE>
<CAPTION>
PERCENTAGES
-----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
N/A N/A N/A 2.23% 1.62% 1.93% 2.78% 2.54% 2.73% 2.45%
<CAPTION>
CALENDAR YEAR
-------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
</TABLE>
Total return January 1 to June 30, 1999 -- 1.06%
Best quarter during years shown: 2nd quarter, 1995 -- 0.76%
Worst quarter during years shown: 1st and 2nd quarter 1993, and 1st quarter,
1994 -- 0.39%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1998
<TABLE>
<S> <C>
One Year................................................ 2.45%
Five Years.............................................. 2.49%
Life of Fund (2/01/91).................................. 2.54%
</TABLE>
===========
- --------------------------------------------------------------------------------
16
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA New Jersey Municipal Money Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investment)
<TABLE>
<S> <C>
Maximum Sales Charge (Load) Imposed on Purchases (as a % of
offering price)............................................. None
Maximum Contingent Deferred Sales Charge (Load) (as a % of
offering price)............................................. None
Maximum Account Fee*
PaineWebber RMA Program................................... $ 85
PaineWebber BSA Program................................... $125
</TABLE>
- ------------
* Additional fees may apply for optional RMA/BSA services, such as a Bank One
Line of Credit for MasterCard'r' transactions.
<TABLE>
<S> <C>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted
from fund assets)
Management Fees............................................. 0.50%
Distribution and/or Service (12b-1) Fees.................... 0.12%
Other Expenses.............................................. 0.27%
-----
Total Annual Fund Operating Expenses........................ 0.89%
-----
-----
</TABLE>
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.
This example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C>
$91 $284 $493 $1,096
</TABLE>
===========
- --------------------------------------------------------------------------------
17
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA New York Municipal Money Fund
New York Municipal Money Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Maximum current income exempt from federal income tax and New York State and New
York City personal income taxes consistent with liquidity and conservation of
capital.
PRINCIPAL INVESTMENT STRATEGIES
The fund is a money market fund and seeks to maintain a stable price of $1.00
per share. The fund invests in a diversified portfolio of high quality money
market instruments that are exempt from federal income tax and from both New
York State and New York City personal income taxes.
Money market instruments are short-term debt obligations and similar securities.
They also include longer term bonds that have variable interest rates or other
special features that give them the financial characteristics of short-term
debt. While the fund normally does not do so, it may invest without limit in
instruments that are subject to the federal alternative minimum tax.
PaineWebber Incorporated, the fund's investment adviser, has appointed Mitchell
Hutchins Asset Management Inc. to serve as the fund's sub-adviser. Mitchell
Hutchins selects money market instruments for the fund based on its assessment
of relative values and changes in market and economic conditions.
PRINCIPAL RISKS
An investment in the fund is not a bank deposit and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. While the fund seeks to maintain the value of your investment at $1.00
per share, it is possible to lose money by investing in the fund.
Money market instruments generally have a low risk of loss, but they are not
risk-free. The fund is subject to credit risk, which is the risk that issuers
may fail, or become less able, to make payments when due. The fund also is
subject to interest rate risk. When short-term interest rates rise, the value of
the fund's investments generally will fall, and its yield will tend to lag
behind prevailing rates.
More information about these and other risks of an investment in the fund is
provided below in 'More About Risks and Investment Strategies.' In particular,
see the following headings:
Credit Risk
Interest Rate Risk
Single State Concentration Risk
Related Securities Concentration Risk
Information on the fund's recent holdings can be found in its current
annual/semi-annual reports (see back cover for information on ordering those
reports).
===========
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18
<PAGE>
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=========================
PaineWebber RMA New York Municipal Money Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
table that follows the bar chart shows the average annual returns over several
time periods for the fund's shares.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN
<TABLE>
<CAPTION>
PERCENTAGES
-----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
5.70% 4.98% 3.71% 2.26% 1.67% 2.14% 3.12% 2.76% 2.98% 2.76%
<CAPTION>
CALENDAR YEAR
-------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
</TABLE>
Total return January 1 to June 30, 1999 -- 1.17%
Best quarter during years shown: 2nd quarter, 1989 -- 1.47%
Worst quarter during years shown: 1st quarter, 1993 and 1st quarter,
1994 -- 0.39%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1998
<TABLE>
<S> <C>
One Year................................................ 2.76%
Five Years.............................................. 2.75%
Ten Years............................................... 3.20%
</TABLE>
===========
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19
<PAGE>
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=========================
PaineWebber RMA New York Municipal Money Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investment)
<TABLE>
<S> <C>
Maximum Sales Charge (Load) Imposed on Purchases (as a % of
offering price)............................................. None
Maximum Contingent Deferred Sales Charge (Load) (as a % of
offering price)............................................. None
Maximum Account Fee*
PaineWebber RMA Program................................... $ 85
PaineWebber BSA Program................................... $125
</TABLE>
- ------------
* Additional fees may apply for optional RMA/BSA services, such as a Bank One
Line of Credit for MasterCard'r' transactions.
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from fund assets)
<TABLE>
<S> <C>
Management Fees............................................. 0.49%
Distribution and/or Service (12b-1) Fees.................... 0.13%*
Other Expenses.............................................. 0.03%
-----
Total Annual Fund Operating Expenses........................ 0.65%
-----
-----
</TABLE>
- ------------
* The current rate is 0.125% but has been rounded to 0.13% for purposes of the
table.
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.
This example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C>
$66 $208 $362 $810
</TABLE>
===========
- --------------------------------------------------------------------------------
20
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Funds
MORE ABOUT RISKS
AND INVESTMENT STRATEGIES
- --------------------------------------------------------------------------------
PRINCIPAL RISKS
The main risks of investing in one or more of the funds are described below. Not
all of these risks apply to each fund. You can find a list of the main risks
that apply to a particular fund by looking under the 'Investment Objective,
Strategies and Risks' heading for that fund.
Other risks of investing in a fund, along with further detail about some of the
risks described below, are discussed in the funds' Statement of Additional
Information ('SAI'). Information on how you can obtain the SAI is on the back
cover of this prospectus.
Credit Risk. Credit risk is the risk that the issuer of a money market
instrument will not make principal or interest payments when they are due. Even
if an issuer does not default on a payment, a money market instrument's value
may decline if the market believes that the issuer has become less able, or less
willing, to make payments on time. Even the highest quality money market
instruments are subject to some credit risk.
Foreign Securities Risk. Foreign securities involve risks that normally are not
associated with securities of U.S. issuers. These include risks relating to
political, social and economic developments abroad and differences between U.S.
and foreign regulatory requirements and market practices.
Interest Rate Risk. The value of money market instruments generally can be
expected to fall when short-term interest rates rise and to rise when short-term
interest rates fall. Interest rate risk is the risk that interest rates will
rise, so that the value of a fund's investments will fall. Also, a fund's yield
will tend to lag behind changes in prevailing short-term interest rates. This
means that a fund's income will tend to rise more slowly than increases in
short-term interest rates. Similarly, when short-term interest rates are
falling, a fund's income will tend to fall more slowly.
Related Securities Concentration Risk. Each of the California, New Jersey and
New York municipal money market funds may invest more than 25% of its total
assets in municipal money market instruments that are issued to finance similar
projects, such as those relating to education, health care, transportation or
utilities. Economic, business or political developments or changes that affect
one municipal security may affect municipal securities in the same sector. As a
result, these funds are subject to greater risk than funds that do not follow
this practice.
Single State Concentration Risk. The performance of a fund that invests
primarily in the municipal money market instruments of a single state will be
more severely affected by unfavorable political or economic conditions within
that state than a more geographically diversified fund. As a result, an
investment in the fund could be more volatile and involve greater risk than an
investment in a more geographically diversified fund. The particular risks of
investments in California, New Jersey and New York municipal money market
instruments are discussed in the SAI.
===========
- --------------------------------------------------------------------------------
21
<PAGE>
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=========================
PaineWebber RMA Funds
In addition, a single state municipal money market fund is permitted to invest
more than 5% of its total assets in the securities of a single issuer with
respect to 25% of its total assets. When a fund holds a large position in the
securities of a single issuer, changes in the financial condition or in the
market's assessment of that issuer can cause larger changes in the value of the
funds' total investments and its income than if the fund held a smaller
position.
ADDITIONAL RISKS
Year 2000 Risk. The funds could be adversely affected by problems relating to
the inability of computer systems used by Mitchell Hutchins and the funds' other
service providers to recognize the year 2000. While year 2000-related computer
problems could have a negative effect on the funds, Mitchell Hutchins is working
to avoid these problems with respect to its own computer systems and to obtain
assurances from other service providers that they are taking similar steps.
Similarly, the issuers whose money market instruments are bought by the funds
and the trading systems used by the funds could be adversely affected by this
issue. The ability of an issuer or trading system to respond successfully to the
issue requires both technological sophistication and diligence, and there can be
no assurance that any steps taken will be sufficient to avoid an adverse impact
on the funds.
Political Risk. Political or regulatory developments could adversely affect the
tax-exempt status of interest paid on municipal securities or the tax-exempt
status of a municipal money market fund's dividends. These developments could
also cause the value of a fund's municipal money market instruments to fall.
ADDITIONAL INVESTMENT STRATEGIES
Like all money market funds, the funds are subject to maturity, quality and
diversification requirements designed to help them maintain a stable price of
$1.00 per share. The funds' investment strategies are designed to comply with
these requirements.
The California, New Jersey and New York municipal money market funds are
organized as 'non-diversified' funds. Normally, this would mean that they would
not be subject to certain limitations on investments of more than 5% of total
assets in the securities of a single issuer. However, because these funds are
single state money market funds, they are subject to special regulations that
impose substantially the same limitations as normally apply to 'diversified'
mutual funds. The other funds are subject to even more stringent diversification
requirements, which apply to money market funds that are not single state funds.
Mitchell Hutchins may use a number of professional money management techniques
to respond to changing economic and money market conditions and to shifts in
fiscal and monetary policies. These techniques include varying a fund's
composition and weighted average maturity based upon its assessment of the
relative values of various money market instruments and future interest rate
patterns. Mitchell Hutchins also may buy or sell money market instruments to
take advantage of yield differences.
Defensive Positions for Municipal Money Market Funds. During adverse market
conditions or when Mitchell Hutchins believes there is an insufficient supply of
the municipal securities in which a fund primarily invests, Tax-Free Fund and
the California, New Jersey and New York municipal money market funds each may
temporarily invest
===========
- --------------------------------------------------------------------------------
22
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Funds
in other types of municipal securities or may invest in money market instruments
that pay taxable interest. These investments may not be consistent with
achieving a fund's investment objectives during the relatively short periods
that they are held.
- --------------------------------------------------------------------------------
MANAGING YOUR FUND ACCOUNT
- --------------------------------------------------------------------------------
BUYING SHARES
You must be a PaineWebber client or a client of a PaineWebber correspondent firm
to purchase fund shares. Shares of the funds are available primarily through the
PaineWebber Resource Management Account'r' (RMA'r') Program, the PaineWebber
Business Services Account'sm' (BSA'sm') Program and certain PaineWebber advisory
programs.
Certain features available to RMA and BSA participants are summarized in the
Appendices to the SAI. The RMA and BSA programs are more fully described in
separate materials your Financial Advisor can provide you. Not all correspondent
firms have arrangements with PaineWebber to make fund shares available to their
customers.
PaineWebber asks participants in these programs to select one of the funds as
their primary sweep money fund. You may have only one primary sweep money fund
at any time, but you may change your primary sweep money fund or purchase shares
of another fund by contacting your Financial Advisor.
Your order to purchase a fund's shares will be effective on the business day on
which federal funds become available to the fund. Federal funds are funds
deposited by a commercial bank in an account at a Federal Reserve Bank that can
be transferred to a similar account of another bank in one day and thus can be
made immediately available to the fund. A business day is any day that the
Boston offices of the fund's custodian and the New York City offices of
PaineWebber and its bank are open for business.
Each fund (other than Money Market Portfolio) has adopted a plan under rule
12b-1 under which the fund pays fees for services provided to its shareholders
at the annual rate of 0.125% of its average net assets (0.12% for New Jersey
Municipal Money Fund).
The funds and PaineWebber reserve the right to reject a purchase order or
suspend the offering of fund shares.
BUYING SHARES AUTOMATICALLY
All free cash credit balances (that is, immediately available funds) of over $1
in your PaineWebber RMA or BSA brokerage account (including proceeds from
securities you have sold) are automatically invested in your primary sweep money
fund on a daily basis for settlement the next business day, when federal funds
normally are available. For cash balances arising from the sale of securities in
your brokerage account, federal funds availability can sometimes take longer.
Fund shares will be purchased only after all debits and charges to your RMA or
BSA
===========
- --------------------------------------------------------------------------------
23
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Funds
brokerage account are satisfied. See 'Selling Shares Automatically' below.
BUYING SHARES BY CHECK OR ELECTRONIC FUNDS TRANSFER CREDIT
RMA and BSA participants may purchase shares of their primary sweep money fund
or another fund by placing an order with their PaineWebber Financial Advisor and
providing a check from a U.S. bank. You should include your PaineWebber account
number on the check.
Federal funds are deemed available to a fund two business days after the deposit
of a personal check or an Electronic Funds Transfer credit initiated by
PaineWebber and one business day after deposit of a cashier's or certified
check. PaineWebber may benefit from the temporary use of the proceeds of
personal checks and Electronic Funds Transfer credits if they are converted to
federal funds in less than two business days.
BUYING SHARES BY WIRE
You may purchase fund shares by placing an order through your Financial Advisor
and instructing your bank to transfer federal funds by wire to:
The Bank of New York
ABA 021-000018
A/C 890-0114-088, OBI=FBO
[Account Name]/[Brokerage Account Number.]
The wire must include your name and RMA or BSA brokerage account number.
If PaineWebber receives a notice from your bank of wire transfer of federal
funds for a purchase of fund shares by 12:00 noon, Eastern time, PaineWebber
will execute the purchase on that day. Otherwise, PaineWebber will execute the
order on the next business day. PaineWebber and/or your bank may impose a
service charge for wire transfers.
MINIMUM INVESTMENTS
The funds have no minimum for initial investments or to add to an account, but
reserve the right to establish minimum investment requirements at any time.
SELLING SHARES
You may sell your shares by contacting your Financial Advisor in person or by
telephone or mail. You may also use the checkwriting service to sell your
shares. Your fund shares will be sold automatically to settle any outstanding
securities purchases, charges or debits to your PaineWebber brokerage account,
unless you instruct your Financial Advisor otherwise.
If you own shares of more than one fund, shares of your primary sweep money fund
are always sold first for automatic sales or if you do not specify which fund's
shares are to be sold. Shares in the other funds will be sold, if necessary, in
the following order: first, Money Market Portfolio; second, U.S. Government
Portfolio; third, Tax-Free Fund; and fourth, California Municipal Money Fund,
New Jersey Municipal Money Fund or New York Municipal Money Fund.
If you sell all your shares in a fund, you will receive cash credits to your RMA
or BSA brokerage account for dividends earned on those shares prior to the sale
date.
SELLING SHARES AUTOMATICALLY
Under the RMA, BSA and advisory programs, PaineWebber sells fund shares
automatically to satisfy outstanding debits and charges in your brokerage
account.
===========
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24
<PAGE>
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=========================
PaineWebber RMA Funds
Debits include amounts due PaineWebber on settlement date for securities
purchases, margin loans, PaineWebber checks, federal funds wires arranged by
PaineWebber and related fees.
Charges include RMA and BSA checks, MasterCard purchases, cash advances, Bill
Payment Service payments and Automated Clearing House transfers, including
Electronic Funds Transfer Debits.
Shares are sold to cover debits on the day the debit is generated. Shares are
sold automatically to cover RMA and BSA checks and MasterCard cash advances on
the day they are paid.
Shares are sold automatically to cover MasterCard purchases at the end of the
MasterCard monthly billing period. Shares also are sold at the end of the
MasterCard monthly billing period to cover interest due on and credit extended
and outstanding under the Bank One Line of Credit. Shares are sold to pay for
securities purchases on settlement date.
SELLING BY MAIL
If you send an order to sell your shares by mail to PaineWebber or its
correspondent firms, your request must include:
Your name and address;
The fund's name;
Your account number;
The dollar amount or number of shares you want to sell; and
A guarantee of each registered owner's signature. A signature guarantee may be
obtained from a financial institution, broker, dealer or clearing agency that
is a participant in one of the medallion programs recognized by the Securities
Transfer Agents Association. These are: Securities Transfer Agents Medallion
Program (STAMP), Stock Exchanges Medallion Program (SEMP) and the New York
Stock Exchange Medallion Signature Program (MSP). The funds and their transfer
agent will not accept signature guarantees that are not a part of these
programs.
Sales by mail may also need to include additional supporting documents for sales
by estates, trusts, guardianships, custodianships, partnerships and
corporations.
ADDITIONAL INFORMATION
It costs the fund money to maintain shareholder accounts. Therefore, each fund
reserves the right to repurchase all shares in any account that has a net asset
value of less than $500. If a fund elects to do this with your account, it will
notify you that you can increase the amount invested to $500 or more within 60
days. This notice may appear on your account statement.
If you want to sell shares that you purchased recently, a fund may delay payment
to assure that it has received good payment. If you purchased shares by check,
this can take up to 15 days.
PaineWebber has the right to terminate your RMA or BSA brokerage account for any
reason. In that case, PaineWebber will sell all of the fund shares held in the
RMA or BSA brokerage account and will send you the proceeds within three
business days.
PRICING AND VALUATION
The price of fund shares is based on net asset value. The net asset value is the
total value of a fund divided by the total number of shares outstanding. In
determining net asset value, each fund values its securities at their amortized
cost. This method uses a constant amortization to maturity of the difference
between the cost of the instrument to the fund and the amount due at
===========
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25
<PAGE>
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=========================
PaineWebber RMA Funds
maturity. Each fund's net asset value per share is expected to be $1.00,
although this value is not guaranteed.
Each fund calculates net asset value once each business day at 12:00 noon,
Eastern time. Your price for buying or selling shares will be the net asset
value that is next calculated after the fund accepts your order. Your Financial
Advisor is responsible for making sure that your order is promptly sent to the
fund when shares are purchased other than through the automatic program
described above.
- --------------------------------------------------------------------------------
MANAGEMENT
- --------------------------------------------------------------------------------
INVESTMENT ADVISER AND SUB-ADVISER
PaineWebber is the investment adviser and administrator of each fund. Mitchell
Hutchins is each fund's sub-adviser and sub-administrator. PaineWebber and
Mitchell Hutchins are located at 1285 Avenue of the Americas, New York, New
York, 10019. Mitchell Hutchins is a wholly owned asset management subsidiary of
PaineWebber, which is wholly owned by Paine Webber Group Inc., a publicly owned
financial services holding company. On July 31, 1999, PaineWebber or Mitchell
Hutchins was the adviser or sub-adviser of 33 investment companies with 75
separate portfolios and aggregate assets of approximately $48.0 billion.
ADVISORY FEES
The funds paid advisory and administration fees to PaineWebber for the most
recent fiscal year ended June 30, 1999 at the following annual rates based on
average daily net assets:
<TABLE>
<S> <C>
Money Market Portfolio............... 0.50%
U.S. Government Portfolio............ 0.42%
Tax-Free Fund........................ 0.43%
California Municipal Money Fund...... 0.47%
New Jersey Municipal Money Fund...... 0.50%
New York Municipal Money Fund........ 0.49%
</TABLE>
===========
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26
<PAGE>
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=========================
PaineWebber RMA Funds
DIVIDENDS AND TAXES
- --------------------------------------------------------------------------------
DIVIDENDS
The funds declare dividends daily and pay them monthly. The funds distribute any
net short-term capital gain annually, but may make more frequent distributions
if necessary to maintain their share prices at $1.00 per share.
Shares earn dividends on the day they are purchased but not on the day they are
sold.
You will receive dividends in additional shares of a fund unless you elect to
receive them in cash. Contact your Financial Advisor at PaineWebber or one of
its correspondent firms if you prefer to receive dividends in cash.
TAXES
The dividends that you receive from Money Market Portfolio and U.S. Government
Portfolio generally are subject to federal income tax regardless of whether you
receive them in additional fund shares or in cash. These funds expect that their
dividends will be taxed as ordinary income. If you hold fund shares through a
tax-exempt account or plan, such as an IRA or 401(k) plan, dividends on your
shares generally will not be subject to tax.
The dividends that you receive from Tax-Free Fund, California Municipal Money
Fund, New York Municipal Money Fund and New Jersey Municipal Money Fund
generally are not subject to federal income tax.
In addition, California Municipal Money Fund seeks to pay dividends that are
exempt from California personal income tax, New Jersey Municipal Money Fund
seeks to pay dividends that are exempt from New Jersey personal income tax and
New York Municipal Money Fund seeks to pay dividends that are exempt from New
York State and New York City personal income taxes.
Each fund will tell you how you should treat its dividends for tax purposes. You
will not recognize any gain on the sale of your shares in a fund so long as the
fund maintains a share price of $1.00.
Each fund is required to withhold 31% of all taxable dividends payable to any
individuals and certain other noncorporate shareholders who
have not provided the fund or PaineWebber with
a correct taxpayer identification number on Form W-9 (for U.S. citizens
and resident aliens) or
a properly completed claim for exemption on Form W-8 (for nonresident
aliens and other foreign entities), or
are otherwise subject to backup withholding.
===========
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27
<PAGE>
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=========================
PaineWebber RMA Funds
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The following financial highlights tables are intended to help you understand
the funds' financial performance for the past 5 years. Certain information
reflects financial results for a single fund share. In the tables, 'total
investment return' represents the rate that an investor would have earned on an
investment in a fund (assuming reinvestment of all dividends).
Except as indicated below, the information in the financial highlights has been
audited by Ernst & Young LLP, independent auditors, whose report, along with
the funds' financial statements, are included in the funds' annual report to
shareholders. You may obtain the funds' annual report without charge by calling
1-800-762-1000. For New Jersey Municipal Money Fund, the information appearing
below for the fiscal year ended October 31, 1994 was audited by other auditors,
whose report thereon also was unqualified.
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
-------------------------------------------------------------------
FOR THE YEARS ENDED JUNE 30,
-------------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ---------- ---------- ----------
Net investment income............................. 0.46 0.051 0.049 0.051 0.049
Dividends from net investment income.............. (0.46) (0.051) (0.049) (0.051) (0.049)
----------- ----------- ---------- ---------- ----------
Net asset value, end of year...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ---------- ---------- ----------
----------- ----------- ---------- ---------- ----------
Total investment return(1)........................ 4.76% 5.21% 5.04% 5.25% 5.00%
----------- ----------- ---------- ---------- ----------
----------- ----------- ---------- ---------- ----------
Ratios/Supplemental Data:
Net assets, end of year (000's)................... $13,446,140 $11,135,226 $8,673,055 $7,522,612 $5,398,146
Expenses to average net assets.................... 0.59% 0.60% 0.59% 0.60%(2) 0.59%
Net investment income to average net assets....... 4.64% 5.09% 4.94% 5.14%(2) 4.91%
</TABLE>
- ------------
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each year reported, reinvestment of all dividends at net asset
value on the payable dates, and a sale at net asset value on the last day of
each year reported.
(2) These ratios include non-recurring acquisition expenses of 0.01%.
===========
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28
<PAGE>
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=========================
PaineWebber RMA Funds
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
U.S. GOVERNMENT PORTFOLIO
-----------------------------------------------------------------
FOR THE YEARS ENDED JUNE 30,
-----------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Net investment income............................... 0.044 0.049 0.048 0.049 0.046
Dividends from net investment income................ (0.044) (0.049) (0.048) (0.049) (0.046)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year........................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Total investment return(1).......................... 4.45% 5.05% 4.88% 5.04% 4.67%
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Ratios/Supplemental Data:
Net assets, end of year (000's)..................... $1,354,594 $1,179,575 $1,083,866 $1,137,510 $ 815,781
Expenses to average net assets...................... 0.60% 0.57% 0.62% 0.65%(2) 0.63%
Net investment income to average net assets......... 4.35% 4.93% 4.78% 4.91%(2) 4.55%
</TABLE>
- ------------
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each year reported, reinvestment of all dividends at net asset
value on the payable dates, and a sale at net asset value on the last day of
each year reported.
(2) These ratios include non-recurring acquisition expenses of 0.02%.
<TABLE>
<CAPTION>
TAX-FREE FUND
------------------------------------------------------------------
FOR THE YEARS ENDED JUNE 30,
------------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Net investment income.............................. 0.026 0.031 0.029 0.030 0.030
Dividends from net investment income............... (0.026) (0.031) (0.029) (0.030) (0.030)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year....................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Total investment return(1)......................... 2.67% 3.10% 2.98% 3.09% 3.03%
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Ratios/Supplemental Data:
Net assets, end of year (000's).................... $2,424,938 $2,271,969 $2,065,920 $2,013,448 $1,562,040
Expenses to average net assets..................... 0.59% 0.58% 0.61% 0.61%(2) 0.63%
Net investment income to average net assets........ 2.63% 3.06% 2.94% 3.02%(2) 3.00%
</TABLE>
- ------------
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each year reported, reinvestment of all dividends at net asset
value on the payable dates, and a sale at net asset value on the last day of
each year reported.
(2) These ratios include non-recurring acquisition expenses of 0.01%.
===========
- --------------------------------------------------------------------------------
29
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Funds
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CALIFORNIA MUNICIPAL MONEY FUND
--------------------------------------------------------
FOR THE YEARS ENDED JUNE 30,
--------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year.......................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Net investment income....................................... 0.023 0.028 0.028 0.029 0.029
Dividends from net investment income........................ (0.023) (0.028) (0.028) (0.029) (0.029)
-------- -------- -------- -------- --------
Net asset value, end of year................................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
Total investment return(1).................................. 2.31% 2.87% 2.87% 2.89% 2.91%
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
Ratios/Supplemental Data:
Net assets, end of year (000's)............................. $575,296 $566,957 $492,915 $473,726 $330,937
Expenses to average net assets.............................. 0.67% 0.65% 0.62% 0.70%(2) 0.69%
Net investment income to average net assets................. 2.28% 2.83% 2.83% 2.82%(2) 2.87%
</TABLE>
- ------------
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each year reported, reinvestment of all dividends at net asset
value on the payable dates, and a sale at net asset value on the last day of
each year reported.
(2) These ratios include non-recurring acquisition expenses of 0.03%.
<TABLE>
<CAPTION>
NEW JERSEY MUNICIPAL MONEY FUND
---------------------------------------------------------------------
FOR THE EIGHT FOR THE YEARS
MONTHS ENDED ENDED
FOR THE YEARS ENDED JUNE 30, JUNE 30, OCTOBER 31,
--------------------------------- ------------- -----------------
1999 1998 1997 1996 1995(2) 1994
---- ---- ---- ---- ------- ----
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- -------
Net investment income............................. 0.022 0.026 0.026 0.017 0.027 0.018
Dividends from net investment income.............. (0.022) (0.026) (0.026) (0.017) (0.027) (0.018)
------- ------- ------- ------- ------- -------
Net asset value, end of period.................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total investment return(1)........................ 2.21% 2.67% 2.65% 1.71% 2.75% 1.76%
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Ratios/Supplemental Data:
Net assets, end of period (000's)................. $62,972 $48,279 $52,324 $42,233 $36,206 $31,981
Expenses to average net assets.................... 0.89% 0.85% 0.81% 0.95%* 0.93% 0.85%
Net investment income to average net assets....... 2.18% 2.64% 2.63% 2.56%* 2.73% 1.74%
</TABLE>
- ------------
* Annualized
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each period reported, reinvestment of all dividends at net
asset value on the payable dates, and a sale at net asset value on the last
day of each period reported. Total investment returns for periods of less
than one year have not been annualized.
(2) Investment advisory functions for the Fund were transferred from Kidder,
Peabody Asset Management, Inc. to PaineWebber on January 30, 1995.
===========
- --------------------------------------------------------------------------------
30
<PAGE>
- --------------------------------------------------------------------------------
=========================
PaineWebber RMA Funds
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW YORK MUNICIPAL MONEY FUND
------------------------------------------------------------------
FOR THE YEARS ENDED JUNE 30,
------------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Net investment income............................... 0.025 0.029 0.028 0.029 0.028
Dividends from net investment income................ (0.025) (0.029) (0.028) (0.029) (0.028)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year........................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Total investment return(1).......................... 2.50% 2.97% 2.85% 2.91% 2.81%
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Ratios/Supplemental Data:
Net assets, end of year (000's)..................... $ 372,880 $ 339,391 $ 274,338 $ 255,177 $ 192,799
Expenses to average net assets before waiver from
adviser........................................... 0.65% 0.65% 0.77% 0.74%(2) 0.71%
Expenses to average net assets after waiver from
adviser........................................... 0.65% 0.65% 0.67% 0.72%(2) 0.68%
Net investment income to average net assets before
waiver from adviser............................... 2.46% 2.92% 2.71% 2.80%(2) 2.78%
Net investment income to average net assets after
waiver from adviser............................... 2.46% 2.92% 2.81% 2.82%(2) 2.81%
</TABLE>
- ------------
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each year reported, reinvestment of all dividends at net asset
value on the payable dates, and a sale at net asset value on the last day of
each year reported.
(2) These ratios include non-recurring acquisition expenses of 0.04%.
===========
- --------------------------------------------------------------------------------
31
<PAGE>
If you want more information about a fund, the following documents are available
free upon request:
ANNUAL/SEMI-ANNUAL REPORTS
Additional information about a fund's investments is available in the fund's
annual and semi-annual reports to shareholders.
STATEMENT OF ADDITIONAL INFORMATION (SAI)
The SAI provides more detailed information about the funds and is incorporated
by reference into this prospectus.
You may discuss your questions about a fund by contacting your PaineWebber
Financial Advisor. You may obtain free copies of annual and semi-annual reports
and the SAI by contacting the fund directly at 1-800-762-1000.
You may review and copy information about a fund, including shareholder reports
and the SAI, at the Public Reference Room of the Securities and Exchange
Commission. You can get text-only copies of reports and other information about
a fund and information about the operations of the SEC's Public Reference Room:
For a fee, by writing to or calling the
SEC's Public Reference Room,
Washington, D.C. 20549-6009
Telephone: 1-800-SEC-0330
Free, from the SEC's Internet website at:
http://www.sec.gov
PaineWebber RMA Money Fund, Inc.
- -- Money Market Portfolio
- -- U.S. Government Portfolio
Investment Company Act File No. 811-3503
PaineWebber RMA Tax-Free Fund, Inc.
Investment Company Act File No. 811-3504
PaineWebber Managed Municipal Trust
- -- RMA California Municipal Money Fund
- -- RMA New York Municipal Money Fund
Investment Company Act File No. 811-3946
PaineWebber Municipal Money Market Series
- -- RMA New Jersey Municipal Money Fund
Investment Company Act File No. 811-6173
'c' 1999 PaineWebber Incorporated
PAINEWEBBER RMA
Prospectus
=================================
MONEY MARKET PORTFOLIO
U.S. GOVERNMENT PORTFOLIO
TAX-FREE FUND
CALIFORNIA MUNICIPAL MONEY FUND
NEW JERSEY MUNICIPAL MONEY FUND
NEW YORK MUNICIPAL MONEY FUND
August 31, 1999
STATEMENT OF DIFFERENCES
------------------------
The copyright symbol shall be expressed as ............................... 'c'
The registered trademark symbol shall be expressed as .................... 'r'
The service mark symbol shall be expressed as ............................ 'sm'
