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VIRGINIA TAX-EXEMPT FUND:
"A TAX-EXEMPT MONEY-MARKET FUND
FOR RESIDENTS OF VIRGINIA"
PROSPECTUS
MARCH 1, 2000
The VIRGINIA TAX-EXEMPT FUND (a "Fund") of Reserve Tax-Exempt Trust is a
money-market fund whose investment objective is to seek as high a level of
short-term interest income exempt from federal income and state and local
personal income and/or property taxes, if any, for resident holders of Virginia
as is consistent with preservation of capital and liquidity.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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TABLE OF CONTENTS
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Investment Objectives & Principal Strategies............................. 2
Performance History...................................................... 4
Fees & Expenses of the Fund.............................................. 5
Management............................................................... 5
How to Buy Shares........................................................ 6
Selling Fund Shares...................................................... 7
Tax Consequences......................................................... 8
General Information...................................................... 9
Financial Highlights..................................................... 9
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INVESTMENT OBJECTIVES & PRINCIPAL STRATEGIES
The investment objective of the Fund is to seek as high a level of
short-term interest income exempt from federal income and state and local
personal income and/or property taxes, if any, for resident holders of Virginia
as is consistent with preservation of capital and liquidity. The Fund seeks to
attain its objective by investing principally in tax-exempt obligations issued
by the Commonwealth of Virginia and its counties, municipalities, authorities or
other political subdivisions. However, achievement of this objective cannot be
assured.
The Fund is designed for institutions and individuals as a convenient
alternative to the direct investment of temporary cash balances in short-term
money-market accounts or instruments. The Fund seeks to employ idle cash at
yields competitive with yields of other comparable short-term investments, and
is designed to reduce or eliminate for the investor the mechanical problems of
direct investment in other instruments such as scheduling maturities and
reinvestment, as well as evaluating the credit of issuers, investing in round
lots, safeguarding receipt and delivery of securities.
The Fund seeks to maintain a stable $1.00 share price. The portfolio
managers monitor a range of economic and financial factors. Based on their
analysis, the Fund is principally invested in high quality, tax-exempt
obligations issued by Virginia and its counties, municipalities, authorities or
other political subdivisions that are intended to provide as high a yield as
possible without violating the Fund's credit quality policies or jeopardizing
the stability of its share price.
The Fund's principal investment strategies include:
o Investing primarily in municipal money-market securities. The Fund
invests principally in high-quality, tax-exempt obligations issued by
Virginia and its counties, municipalities, authorities or other political
subdivisions. These securities are generally referred to as "municipal
obligations".
o Investing at least 80% of the value of the Fund's net assets in municipal
obligations which are exempt from federal income and state and local
personal income taxes, including federal Alternative Minimum Tax ("AMT"),
unless it has adopted a temporary defensive position. Interest received
on certain otherwise tax-exempt securities ("private activity bonds") is
subject to federal AMT. It is the position of the SEC that in order for a
fund to call itself "tax-free", not more than 20% of its net assets may
be invested in municipal securities subject to the AMT or at least 80% of
its income will be tax-exempt. Income received on such securities is
classified as a "tax preference item," which could subject certain
shareholders of the Fund to
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AMT. However, as of the date of this Prospectus, the Fund does not intend
to purchase such securities. The Fund may take temporary defensive
positions that are inconsistent with the Fund's principal investment
strategies in attempting to respond to adverse market, economic,
political or other conditions and may invest more than 20% of the value
of its net assets in municipal obligations exempt only from federal
income taxes.
o Investing in compliance with federal regulations of money-market funds,
which are designed to help maintain liquidity and the strict standards
for credit quality, diversification and maturity.
The interest on securities generally known as municipal obligations is
exempt from federal income tax in the opinion of either bond counsel for the
issuer or, in some instances, the issuer itself. These obligations may be issued
to raise money for various public purposes such as constructing public
facilities, while others are issued to obtain funding for privately operated
facilities. General obligation bonds and notes are backed by the taxing power of
the issuer. Revenue bonds and notes are backed by the revenues of a project or
facility such as tolls from a toll road or, in some cases, from the proceeds of
a special excise tax, but not by the general taxing power. Industrial
development revenue bonds and notes are a specific type of revenue bond or note
backed by the credit of a private issuer. Municipal obligations bear fixed,
variable or floating rates of interest.
The Fund will purchase tax-exempt securities which are rated MIG1 or MIG2
by Moody's Investor Services, Inc. ("Moody's"), SP-1 or SP-2 by Standard &
Poor's Corporation ("S&P") or the equivalent. Municipal obligations which are
not rated may also be purchased provided Reserve Management Co., Inc ("RMCI"),
the Adviser, determines them to be of comparable quality pursuant to guidelines
established by their Boards of Trustees ("Trustees").
Although not a principal strategy, the Fund is allowed to invest all or
substantially all of its investable assets, except to the extent required to
remain uninvested to satisfy cash requirements, in another open-end management
company having the same investment objective and substantially similar policies
and restrictions.
RMCI uses its reasonable business judgment in selecting investments in
addition to considering the ratings of Moody's, S&P and other rating services,
when available.
The investment objective and principal strategies are summarized here. For
more information on the investment objective and strategies, please read the
Statement of Additional Information ("SAI").
PRINCIPAL RISKS OF INVESTING IN THE FUND. The Fund is a money-market fund,
which is a specific type of fund that seeks to maintain a $1.00 price per share.
An investment in the Fund is not insured or guaranteed by the U.S. government,
Federal Deposit Insurance Corporation or any other government agency. Although
the Fund seeks to preserve the value of your investment at $1.00 per share, it
is possible to lose money by investing in the Fund. Additionally, the Fund's
yield will vary as the short-term securities in its portfolio mature and the
proceeds are reinvested in securities with different interest rates.
While the Fund will strive to maintain a constant share price, the
following factors and principal investment risks could reduce the Fund's income
level and/or share price:
o Interest rates could rise sharply causing the value of the Fund's
securities and share price to drop. When interest rates fall, the Fund's
yields will typically fall as well.
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o Yields on municipal securities depend on a variety of factors, including
general economic and monetary conditions, money-market factors,
conditions in the tax-exempt securities market, size of a particular
offering, maturity of the obligation and rating of the issue.
o The value of municipal securities may be affected by uncertainties and
changes in municipal market-related legislation or litigation.
o Overall, a decline in the credit quality of an issuer or the provider of
credit support or a maturity-shortening structure for a security can
cause the price of a money-market security to decrease.
o The Fund concentrates its investments in securities of issuers located in
the Commonwealth of Virginia and is non-diversified under the Investment
Company Act. This raises special concerns because performance is more
dependent upon the performance of a smaller number of securities and
issuers than in a diversified portfolio. The change in value of any one
security may affect the overall value of the Fund more than it would in a
diversified portfolio. In particular, changes in the economic conditions
and governmental policies of Virginia and its political subdivisions can
significantly affect the financial condition and credit quality of
issuers of municipal securities located in that state. Further, the
municipal market is volatile. As to the Virginia Tax-Exempt Fund,
investors should realize that the Commonwealth's low unemployment level
is due in large part to Federal Government jobs available to it's
residents in neighboring Washington D.C. Virginia's continued financial
strength rests in its ability to maintain low debt levels and to
diversify its economy.
o The Reserve Funds' emphasis on the high credit quality of its investments
may mean that its yields are lower than those available from certain
other money-market funds, which may invest in commercial paper. Because
of the low level of risk, over time, a money-market fund may produce
lower returns than bond or stock investments which entail higher levels
of risk.
YEAR 2000. Many computer software systems in use today cannot distinguish the
year 2000 from the year 1900. Most of the services provided to the Trust depend
on the smooth functioning of computer systems. The Trust could be adversely
affected if the computer systems and service providers that interface with it
are unable to process data from January 1, 2000 and after including leap day;
however, steps are being taken to reasonably address this issue and to obtain
assurance that comparable efforts are being made by service providers. There can
be no assurance that these steps will be sufficient to avoid any adverse impact
to the Trust. In addition, because the Year 2000 issue affects virtually all
organizations, the extent of its impact cannot be predicted.
PERFORMANCE HISTORY
The Reserve Tax-Exempt Trust did not begin offering shares of the Virginia
Tax-Exempt Fund until March 1, 2000. Therefore, the performance information
(including annual total returns and average annual total returns) for a full
calendar year is not available.
For the Fund's current yield, call toll-free 800 637-1700 or visit our web
site at www.reservefunds.com
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FEES & EXPENSES OF THE FUND
This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.
SHAREHOLDER FEES FOR THE FUND
(Fees paid directly from your investment)
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Sales Load Imposed on Purchases......................................... None
Sales Load Imposed on Reinvested Dividends.............................. None
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ANNUAL FUND OPERATING EXPENSES FOR THE FUND
(Expenses that are deducted from Fund assets)
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Comprehensive Management Fee ......................................... 80%
Distribution (12b)-1 Fees (*) ........................................ .20
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Total Annual Fund Operating Expenses.................................. 1.00%
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(*) The Fund has adopted a Rule 12b-1 plan which allows the Fund to pay
distribution fees for the sale and distribution of its shares. The maximum
level of distribution expenses is 0.20% per year of the Fund's average net
assets. As these fees are paid out of the Fund's assets on an on-going
basis, over time these fees will increase the cost of your investment and
may cost you more than paying other types of sales charges.
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. The example should
not be considered indicative of future investment returns and operating expenses
which may be more or less than those shown. This example is based on the annual
fund operating expenses described in the table.
This example uses the same assumptions other funds use in their
prospectuses. It 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. The costs would be the
same whether you stayed in the Fund or sold your shares at the end of each
period. Your actual costs may be higher or lower.
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ONE YEAR THREE YEARS
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$102 $ 318
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MANAGEMENT
INVESTMENT ADVISER. Since November 15, 1971, Reserve Management Company, Inc.
("RMCI") 1250 Broadway, New York, NY 10001 and its affiliates have provided
investment advice to The Reserve Funds. RMCI serves as the investment adviser to
the Fund under an Investment Management Agreement (the "Agreement") with the
Reserve Tax-Exempt Trust. The Agreement provides that RMCI will furnish
continuous investment advisory and management services to the Fund. In addition
to the Fund, RMCI provides investment management services to other mutual funds
within the Reserve family of funds and, as of February 1, 2000, had
approximately $6.5 billion under management.
RMCI manages the investment portfolio of the Fund, subject to policies
adopted by the Trustees. For its services, RMCI receives a fee of 0.80% per year
of the average daily net assets of the Fund. RMCI pays all employee and
customary operating expenses of the Fund. Excluded from the definition of
customary operating expenses are interest, taxes, brokerage fees, extraordinary
legal and accounting fees and expenses, and the fees of the disinterested
Trustees, for which the Fund pays its direct or allocated share.
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HOW TO BUY SHARES
SHARE PRICE: NET ASSET VALUE. Investors pay no sales charges to invest in the
Fund. The price you pay for a share of the Fund, and the price you receive upon
selling or redeeming a share of the Fund, is called the Fund's net asset value
("NAV") per share. The NAV is calculated by taking the total value of the Fund's
assets, subtracting its liabilities, and then dividing by the number of shares
that have already been issued. The Fund uses the amortized cost method of
valuing its securities under Rule 2a-7 of the 1940 Act. This is a standard
calculation, and forms the basis for all transactions involving buying, selling,
exchanging or reinvesting shares. The NAV is generally calculated as of the
close of trading on the New York Stock Exchange (usually 4:00 PM Eastern time)
every day the Exchange is open. NAV is not calculated on days the Exchange is
closed and regional bank holidays. The Exchange is closed on most national
holidays, and Good Friday. Your order will be priced at the next NAV calculated
after your order is accepted (i.e., converted to federal funds) by the Fund.
PURCHASE OF SHARES. The minimum initial investment is $1,000 (IRA minimum $250)
with no minimum subsequent investment. All investments must be in U.S. dollars.
Third-party, foreign and travellers checks, as well as cash investments will not
be accepted. For clients of certain broker-dealers and financial institutions
("Firms"), shares may be purchased directly through such Firms. However,
purchases may be subject to the Firms' own minimums and purchase requirements.
Purchase orders are not accepted on days the Exchange is closed for trading and
regional bank holidays.
o By check--(drawn on U.S. bank) payable to The Reserve Funds, 1250
Broadway, New York, NY 10001-3701. You must include your account number
(or Taxpayer Identification Number) on the "pay to the order of" line for
each check made payable to The Reserve Funds or within the endorsement
for each check endorsed to The Reserve Funds.
o By wire--Prior to calling your bank, call The Reserve Funds at
800-637-1700 for specific instructions or the Firm from which you
received this Prospectus.
Checks and wires which do not correctly identify the account to be credited
may be returned or delay the purchase of shares. Only federal funds wires and
checks drawn on the Fund's bank are eligible for entry as of the business day
received. For federal funds wires to be eligible for same-day order entry, the
Fund must be notified before 11:00 AM (Eastern time), of the amount to be
transmitted and the account to be credited Payment by check not immediately
convertible into federal funds will be entered as of the business day when
covering federal funds is received or bank checks are converted into federal
funds. This usually occurs within two (2) business days, but may take longer.
Checks delivered to the Fund's offices after 11:00 AM (Eastern time), will be
considered received the next business day. Investors will be charged a fee $15
for any check that does not clear and will be responsible for any losses
suffered by the Fund as a result.
RESERVE AUTOMATIC ASSET-BUILDER PLAN. If you have an account, you may purchase
shares of the Fund ($25 suggested minimum) from a checking, NOW, or bank
money-market deposit account or from a U.S. government distribution ($25
suggested minimum) such as social security, federal salary, or certain veterans'
benefits, or other payment from the federal government. You may also purchase
shares automatically by arranging to have your payroll deposited directly into
your Reserve account. Please call the Fund at 800-637-1700 for an application.
INDIVIDUAL RETIREMENT ACCOUNTS. Investors may use the Fund as an investment for
Individual Retirement Accounts ("IRAs"). A master IRA plan with information
regarding administration fees and other details is available from the Fund.
THIRD-PARTY INVESTMENTS. Investments made through a third party (rather than
directly with Reserve) such as a financial services agent may be subject to
policies and fees different than those described here. Banks, brokers, 401(k)
plans, financial advisers and financial supermarkets may charge transaction fees
and may set different
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minimum investments or limitations on buying or selling shares. Investors should
consult a representative of the plan or financial institution if in doubt.
DISTRIBUTORS. The Fund's distributor is Resrv Partners, Inc. ("RESRV"), 1250
Broadway, New York, NY 10001-3701.
RESTRICTIONS. Certain other restrictions and conditions for buying shares apply
to the Fund. Please see the SAI for more information.
SELLING FUND SHARES
Investors may sell shares at any time. Shares will be sold at the NAV next
determined after the redemption request is received by the Fund. The Fund
usually transmits payments the same day when requests are received before 11:00
AM (Eastern time) and the next business day for requests received after the time
specified to enable shareholders to receive additional dividends. Shares do not
earn dividends on the day a redemption is effected, regardless of the time the
order is received. Orders will be processed promptly and investors will
generally receive the proceeds within a week after receiving your properly
completed request, which complies with requirements set forth in "Written and
telephone requests" below. The Fund strongly suggests (but does not require)
that each telephone redemption be at least $1,000, except for redemptions which
are intended to liquidate an account. A shareholder will be charged $2 for
redemption checks issued for less than $100. Upon request, redemptions will be
made by bank wire; however, wire redemptions of less than $10,000 will be
charged a fee (currently $10). The Fund assumes no responsibility for delays in
the receipt of wired or mailed funds.
WRITTEN AND TELEPHONE REQUESTS. Redemption instructions and options should be
specified when your account is opened. Subsequent elections and changes in
instructions must be in writing with the signature(s) guaranteed. Changes in
registration or authorized signatories may require additional documentation. One
way to redeem shares is to write a letter of instruction which states: the
name(s) and signature(s) of all accountholders (signature(s) guaranteed, if
necessary), account number, Fund name, the dollar amount you want to sell, and
how and where to send the proceeds. If you are redeeming your IRA, please note
the applicable withholding requirements.
To reduce the risk of loss, certain situations require written instructions
along with signature guarantees. These include:
(1) redemptions for more than $5,000; or
(2) redemptions on accounts whose address has been changed within the past
30 days; or
(3) redemption requests to be sent to someone other than the account owner
or the address of record for the past 30 days.
You may redeem by calling the Fund at 800-637-1700. Unless you decline
telephone privileges on your application and the Fund fails to take reasonable
measures to verify the request, the Fund will not be liable for any unauthorized
telephone redemption, or for any loss, cost or expense for acting upon an
investor's telephone instructions. Telephone redemptions may be sent to the bank
or brokerage account designated by the shareholder on the application or in a
letter with signature guarantee. To change the designated brokerage or bank
account it is necessary to contact the Firm through which shares of the Fund
were purchased or, if purchased directly from the Fund, it is necessary to send
a written request to the Fund with signature(s) guaranteed. The Fund reserves
the right to refuse a telephone redemption if it believes it is advisable to do
so.
Signature guarantees are designed to protect both you and the Fund from
fraud. Signature guarantees can be obtained from most banks, credit unions or
savings associations, or from broker/dealers, national securities exchanges or
clearing agencies. Notaries public cannot provide signature guarantees. For more
information about redemption procedures, please read the SAI.
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CHECKING, VISA AND ATM ACCESS. You may redeem shares of the Fund by using your
Reserve checks and VISA check card. By completing the application or a signature
card (for existing accounts) and certain other documentation, you can write
checks in any amount against your account. A check will be returned (bounced)
and a fee charged if you request a stop payment; the check is postdated;
contains an irregularity in the signature, amount or otherwise; or, is written
against accounts with insufficient or uncollected funds. Please do not postdate
your checks or use them to close your account. Upon proper notice, the Funds may
choose to impose a fee if it deems a shareholder's actions to be burdensome.
Checking may not be available to clients of some Firms, and some Firms may
establish their own minimum check amount. Shareholders may use their VISA check
card at ATM's to receive cash and may be charged a surcharge by the ATM owner.
Please see the SAI for information including charges, fees, etcetera.
EXCHANGE PRIVILEGE. Investors can exchange all or some of their shares offered
for shares in other Reserve money-market and equity funds. Investors can request
an exchange in writing or by telephone. The shares of the other Funds are not
offered by this Prospectus. Be sure to read the current prospectus for any fund
into which you are exchanging. Any new account established through an exchange
will have the same privileges as an original account (as long as they are
available). Please see the SAI for more information.
OTHER AUTOMATIC SERVICES. Certain other services and restrictions for selling
shares automatically are offered by the Fund. Please see the SAI for more
information about these services and restrictions.
REDEMPTIONS THROUGH BROKERS AND FINANCIAL INSTITUTIONS. Redemptions through
brokers and financial institutions may involve such Firms' own redemption
minimums, services fees, and other redemption requirements.
OTHER. The Fund also reserves the right to make a "redemption in kind",
(payment in portfolio securities rather than cash), without notice, if the
amount the investor is redeeming is large enough to affect fund operations (for
example, if it represents more than 1% of the Fund's assets). Further, the Fund
reserves the right to:
o refuse any purchase or exchange request,
o change or discontinue its exchange privilege,
o change its minimum investment amounts, and
o delay sending out redemption proceeds for up to seven days
(generally applies only in cases of very large redemptions,
excessive trading or during unusual market conditions).
TAX CONSEQUENCES
The following discussion is intended as general information only. Because
everyone's tax situation is unique, you should consult your own tax
advisor(s) with regard to the applicability of state and local tax laws on Fund
distributions. For more information, please see the SAI.
DIVIDENDS, DISTRIBUTIONS AND TAXES. The Fund declares dividends daily and
automatically reinvests them in additional shares monthly except for
shareholders who elect in writing to receive cash dividends, in which case
monthly or quarterly dividend checks are sent to the shareholder. There are no
fees or sales charges on reinvestments.
To maintain its regulated investment company status for federal income tax
purposes, the Fund intends to satisfy certain requirements imposed by the
Internal Revenue Code, so as to avoid any federal income or excise tax
liability. Dividends derived from the interest earned on municipal obligations
and designated by the Fund as "exempt interest dividends" are not subject to
federal income taxes. To the extent the Fund invests in municipal
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obligations issued by the Commonwealth of Virginia or political subdivision
thereof, exempt-interest dividends derived from the interest thereon generally
is not subject to state income taxes.
The tax status of dividends and distributions will be detailed in annual
tax statements from the Fund. An exchange of the Fund's shares for the shares of
another fund will be treated as a sale of the Fund's shares and any gain may be
subject to federal income tax.
BACKUP WITHHOLDING. The Fund may be required to withhold U.S. federal income
tax at the rate of 31% of all taxable distributions payable to certain
shareholders who fail to provide the Fund with their correct taxpayer
identification number or to make required certifications, or who have been
notified by the Internal Revenue Service that they are subject to backup
withholding. Backup withholding is not an additional tax. Any amounts withheld
may be credited against the shareholder's U.S. federal income tax liability.
However, special rules apply for certain accounts. For example, for an account
established under the Uniform Gift to Minors Act, the TIN of the minor should be
furnished. Shareholders should be aware that, under regulations promulgated by
the IRS the Fund may be fined $50 annually for each account for which a
certified TIN is not provided or is incorrect. In the event that such a fine is
imposed with respect to an account in any year, a corresponding charge will be
made against the account. The Fund will not accept purchase orders for accounts
for which a correct and certified TIN is not provided or which is otherwise
subject to backup withholding, except in the case of certain non-resident alien
account holders.
GENERAL INFORMATION
SMALL BALANCES. Because of the expense of maintaining accounts with small
balances (less than $1,000), the Fund may choose without notice to either levy a
monthly charge (currently $5) or redeem the account and remit the proceeds. Some
Firms may establish variations of minimum balances and monthly charges if
approved by the Fund.
RESERVE EASY ACCESS. Easy Access is The Reserve Funds' 24-hour toll-free
telephone service that lets customers use a touch-tone phone for a variety of
options, which include yields, account balances, check reorders and other
options. To use it, call 800-637-1700 and follow the instructions. Clients may
also access full account activity for the previous six months on the Internet at
www.reservefunds.com.
INQUIRIES. Shareholders should direct their inquiries to the Firm from which
they received this Prospectus or to The Reserve Funds.
SPECIAL SHAREHOLDER SERVICES. The Fund reserves the right to charge shareholder
accounts for specific costs incurred in processing unusual transactions. Such
transactions include, but are not limited to, stop payment requests, copies of
Fund redemption or shareholder checks, copies of statements and special research
services.
ACCOUNT STATEMENTS. Shareholders are advised to retain all account statements.
FINANCIAL HIGHLIGHTS
The Trust did not offer shares of Virginia Tax-Exempt Fund until March 1, 2000.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN
THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST
NOT BE RELIED UPON. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY
JURISDICTION IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.
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This Prospectus contains the information about the Fund, which a prospective
investor should know before investing.
The Statement of Additional Information ("SAI") contains additional and more
detailed information about the Fund, and is considered part of this Prospectus.
Our Annual and Semi-Annual Reports list the holdings in the Fund, describe Fund
performance, include financial statements for the Fund, and discuss market
conditions and strategies that significantly affected the Fund's performance.
These documents may be obtained without charge by writing to the address below
or calling The Reserve Funds at 800-637-1700. You can download the documents
from the EDGAR database of the SEC's web site (http://www.sec.gov) or, you can
obtain copies by visiting the SEC's Public Reference Room in Washington, DC
(1-202-942-8090) or, by electronic mail request sent to [email protected] or,
by sending your request and duplicating fee to the SEC's Public Reference
Section, Washington, DC 20549-6009.
Investors are advised to read and retain this prospectus for future reference.
[LOGO]
Linsco/Private Ledger
155 Federal Street, 8th Floor
Boston, MA 02110
9785 Towne Centre Drive
San Diego, CA 92121
GENERAL INFORMATION AND 24-HOUR YIELD AND BALANCE INFORMATION
800-637-1700--WWW.RESERVEFUNDS.COM
Distributor -- Resrv Partners, Inc.
RTET/VA-03/2000
SEC File Number
Reserve Tax-Exempt Trust
811-3696
[LOGO]
VIRGINIA TAX-EXEMPT FUND
offered by The Reserve Funds
PROSPECTUS
MARCH 1, 2000
