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497(e) File Nos. 33-5819 and 811-5034
SUPPLEMENT DATED OCTOBER 29, 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 has not had the ability to use the master/feeder structure.
At a meeting held on October 24, 1997, shareholders of these Funds 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.
Shareholders also approved new Management Agreements with Citibank and new Rule
12b-1 Service Plans for the Funds. The new Management Agreements and new Service
Plans will become effective as of January 1, 1998.
Under the new 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. Upon effectiveness of
the new Management Agreements, each Fund's existing advisory and administrative
services agreements will be terminated.
Under the new 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. Advisory and administrative services fees currently payable by the
National Tax Free Income Fund equal 0.80% of the Fund's average daily net assets
on an annual basis and by the New York Tax Free Income Fund equal 0.65% of the
Fund's average daily net assets on an annual basis.
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 new 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. Upon
effectiveness of the new Service Plans, the existing Distribution Plans will be
terminated.
It is not expected that the Funds' total expense ratios will increase after the
new Management Agreements and new Service Plans become effective.
