<PAGE> 1
THE PILOT FUNDS
Pilot Intermediate U.S. Government Securities Fund
Pilot U.S. Government Securities Fund
Pilot Intermediate Municipal Bond Fund
Pilot Municipal Bond Fund
Class A Shares and Class B Shares
Supplement to Prospectus Dated December 29, 1995
At the Regular Meeting of the Board of Trustees held on February 20, 1996, the
Trustees approved the following change in the investment objectives and
policies of the Pilot Intermediate U.S. Government Securities Funds and the
Pilot U.S. Government Securities Fund to become effective on June 1, 1996:
Each Fund will seek total return and preservation of capital by
investing primarily in U.S. Government securities and repurchase
agreements secured by such securities. Each Fund will emphasize the
capital appreciation component of total return.
Each Fund's maturity policies remain unchanged. While the maturity of
individual securities will not be restricted, except during temporary defensive
periods or unusual market conditions, the average weighted maturity of the
Pilot Intermediate U.S. Government Securities Fund will be between three and
ten years, and average weighted maturity of the Pilot U.S. Government
Securities Fund will be between five and thirty years.
The Expense Summary which appears on pages 3-5 of the prospectus is amended to
replace the Expense Table and Example for Class A Shares of the Intermediate
U.S. Government Securities Fund, U.S. Government Securities Fund, Intermediate
Municipal Bond Fund and Municipal Bond Fund, except that the referenced
footnotes have not changed, with the following:
<TABLE>
<CAPTION>
INTERMEDIATE U.S. GOVERNMENT INTERMEDIATE MUNICIPAL
U.S. GOVERNMENT SECURITIES MUNICIPAL BOND BOND
SECURITIES FUND FUND FUND FUND
----------------------------------------------------------------
CLASS A CLASS A CLASS A CLASS A
------- ------- ------- -------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Front End Sales Charge Imposed on Purchases (as a
percentage of offering price) ......................... 4.00%(1) 4.50%(1) 4.00%(1) 4.50%(1)
Sales Charge Imposed on Reinvested Dividends .......... None None None None
Deferred Sales Charge (as a percentage of original
purchase price or redemption proceeds, whichever
is lower) ............................................. None None None None
Exchange Fee .......................................... None None None None
ANNUAL FUND OPERATING EXPENSES AFTER FEE WAIVERS
AND EXPENSE REIMBURSEMENTS (AS A PERCENTAGE OF
AVERAGE NET ASSETS):
Management Fees (4) ................................... 0.35% 0.40% 0.40% 0.45%
Rule 12b-1/Distribution Payments ...................... 0.25% 0.25% 0.25% 0.25%
Other Expenses ........................................ 0.22% 0.22% 0.18% 0.22%
---- ---- ---- ----
Total Fund Operating Expenses After Fee Waivers and
Expenses Reimbursements (4) ........................... 0.82% 0.87% 0.83% 0.92%
---- ---- ---- ----
</TABLE>
The expense information in the above table has been restated to reflect current
fees. Previously a voluntary waiver had reduced Class A Rule 12b-1/Distribution
Payments to 0.20% for U.S. Government Securities Fund and Municipal Bond Fund
and to 0.15% for Intermediate U.S. Government Securities Fund and Intermediate
Municipal Bond Fund.
<PAGE> 2
EXAMPLE: Assume that the annual return on each of the Funds is 5%, and that
their operating expenses are as described above. For every $1,000 you invested
in a particular Fund, after the periods shown below, you would have paid this
much in expenses during such periods:
<TABLE>
<CAPTION>
1 3 5 10
YEAR AFTER YEARS AFTER YEARS AFTER YEARS AFTER
PURCHASE PURCHASE PURCHASE PURCHASE
-----------------------------------------------------------
<S> <C> <C> <C> <C>
PILOT INTERMEDIATE U.S. GOVERNMENT SECURITIES FUND
CLASS A SHARES (1) ................................ $48 $65 $84 $137
PILOT U.S. GOVERNMENT SECURITIES FUND
CLASS A SHARES (1) ................................ $49 $67 $86 $143
PILOT INTERMEDIATE MUNICIPAL BOND FUND
CLASS A SHARES (1) ................................ $48 $65 $84 $138
PILOT MUNICIPAL BOND FUND
CLASS A SHARES (1) ................................ $49 $68 $89 $149
</TABLE>
INVESTORS SHOULD RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
June 30, 1996
PILVABSTK696
