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497(e) File Nos. 33-5819 and 811-5034
SUPPLEMENT DATED SEPTEMBER 8, 1997
TO
PROSPECTUS DATED MAY 1, 1997
FOR
LANDMARK NATIONAL TAX FREE INCOME FUND
LANDMARK NEW YORK TAX FREE INCOME FUND
The third paragraph appearing in the "Management - Investment Adviser" section
on page 17 of the Prospectus is replaced with the following:
John C. Mooney, a Vice President of Citibank, has managed the Funds since June
1997. Mr. Mooney is a Senior Portfolio Manager responsible for managing
tax-exempt fixed income funds. He is also part of the team responsible for
fixed-income strategy, research and trading. Prior to joining Citibank in
1997, Mr. Mooney served as a tax-exempt portfolio manager at SunAmerica for
over three years and also served as a tax-exempt portfolio manager at First
Investors for three years. His prior experience also includes positions at
Alliance Capital Management L.P. and The Boston Company.
Currently, Landmark National Tax Free Income Fund and Landmark New York Tax Free
Income Fund operate on a stand-alone basis; that is, each Fund invests directly
in investment securities. Landmark National Tax Free Income Fund has the ability
to convert to a two-tier, master/feeder structure whereby the Fund would invest
all of its investable assets in a single investment company. Landmark New York
Tax Free Income Fund does not have the ability to use the master/feeder
structure. Subject to shareholder approval, the Trustees of these Funds have
approved an amendment to the Funds' Declaration of Trust and fundamental
investment restrictions to allow these Funds to invest in one or more investment
companies. The Board of Trustees has also approved, subject to shareholder
approval, new Management Agreements with Citibank and new Rule 12b-1 Service
Plans for the Funds.
Under the proposed Management Agreements, Citibank will be responsible for the
overall management of each Fund's business affairs, and will provide investment
advisory as well as administrative services to the Funds. If the proposed
Management Agreements are approved by shareholders, the Fund's existing advisory
and administrative services agreements will be terminated.
Under the proposed Management Agreements, each of the Funds will pay Citibank
management fees equal on an annual basis to 0.75% of the Fund's average daily
net assets, compared to advisory and administrative services fees currently
payable by the National Tax Free Income Fund equal on an annual basis to 0.80%
of the Fund's average daily net assets and by the New York Tax Free Income Fund
equal on an annual basis to 0.65% of the Fund's average daily net assets.
Under the Funds' existing Rule 12b-1 Distribution Plans, the National Tax Free
Income Fund may pay its distributor a monthly distribution fee at an annual rate
not to exceed 0.05% and a monthly service fee at an annual rate not to exceed
0.25%, of the Fund's average daily net assets, and the New York Tax Free Income
Fund may pay its distributor a monthly distribution fee at an annual rate not to
exceed 0.15% of the Fund's average daily net assets. The existing Distribution
Plans also permit the Funds to pay the distributor an additional fee (not to
exceed on an annual basis 0.05% of average daily net assets) in anticipation of
or as reimbursement for print or electronic media advertising expenses incurred
in connection with the sale of Fund shares. Under the proposed Service Plans,
the Funds may pay monthly fees in an amount not to exceed 0.25% per annum of the
Funds' average daily net assets, for both distribution and service matters. If
the proposed Service Plans are approved by shareholders, the existing
Distribution Plans will be terminated.
Assuming the matters described above are approved by shareholders, it is not
expected that the Funds' total expense ratios will increase.
