<PAGE> 1
COVER PAGE
- -------------------------------------------------------------------------------
REPUBLIC FUNDS
===============================================================================
-----------
PROSPECTUS
-----------
March 1, 1999
Republic Bond Fund
Republic New York Tax-Free Bond Fund
Republic Equity Fund
Republic Overseas Equity Fund
Republic Opportunity Fund
The Securities and
Exchange Commission has
not approved the shares
described in this
prospectus or determined
whether this prospectus is
accurate or complete.
Anyone who tells you
otherwise is committing a
crime.
===============================================================================
<PAGE> 2
[GRAPHIC]
REPUBLIC BOND FUND
REPUBLIC
NEW YORK TAX-FREE
BOND FUND
PROSPECTUS
- ------------------- REPUBLIC EQUITY FUND
MARCH 1, 1999
REPUBLIC
OVERSEAS EQUITY FUND
REPUBLIC
OPPORTUNITY FUND
[LOGO] REPUBLIC FAMILY OF FUNDS
THESE SECURITIES HAVE NOT BEEN
APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE> 3
REPUBLIC FUNDS TABLE OF CONTENTS
<TABLE>
<S> <C>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
Carefully review this 3 Republic Bond Fund
important section, which 10 Republic New York Tax-Free Bond Fund
summarizes each Fund's 17 Republic Equity Fund
investments, risks, past 24 Republic Overseas Equity Fund
performance, and fees. 31 Republic Opportunity Fund
INVESTMENT OBJECTIVES, STRATEGIES AND RISKS
LOGO
38 Republic Bond Fund
39 Republic New York Tax-Free Bond Fund
40 Republic Equity Fund
42 Republic Overseas Equity Fund
44 Republic Opportunity Fund
45 General Risk Factors: All Funds
47 Specific Risk Factors
FUND MANAGEMENT
LOGO
Review this section 50 The Investment Adviser
for details on 52 Portfolio Managers
the people and 54 The Distributor and Administrator
organization who provide 55 The Two-Tier Fund Structure
services to the Funds.
SHAREHOLDER INFORMATION
LOGO
Review this section for 56 Pricing of Fund Shares
details on how 57 Purchasing and Adding to Your Shares
shares are valued, 61 Selling Your Shares
and how to purchase, 65 Distribution Arrangements/Sales Charge
sell and exchange shares. 71 Exchanging Your Shares
This section also describes 72 Dividends, Distributions and Taxes
related charges, and
payments of dividends
and distributions.
FINANCIAL HIGHLIGHTS
logo
74 Republic Bond Fund
76 Republic New York Tax-Free Bond Fund
78 Republic Equity Fund
80 Republic Overseas Equity Fund
82 Republic Opportunity Fund
PRIOR PERFORMANCE
LOGO
TAXABLE EQUIVALENT YIELD TABLES
LOGO
</TABLE>
2
<PAGE> 4
The following is a summary of key information about the Funds. You will find
additional information about the Funds, including a detailed description of
the Funds' investment objectives, strategies and risks, after this Summary.
REPUBLIC BOND FUND
<TABLE>
<S> <C>
INVESTMENT OBJECTIVES The investment objective of the Bond Fund is
to realize above-average total return,
consistent with reasonable risk, through
investment primarily in a diversified
portfolio of fixed income securities.
PRINCIPAL The Fund seeks to achieve its investment
INVESTMENT STRATEGIES objective by investing all of its assets in
the Republic Fixed Income Portfolio (the
"Portfolio"), which has the same investment
objective as the Fund. This two-tier fund
structure is commonly referred to as a
"master/feeder" structure because one fund
(the Bond Fund or "feeder fund") is
investing all its assets in a second fund
(the Portfolio or "master fund").
The Portfolio invests primarily in fixed
income securities, such as U.S. Government
securities, corporate debt securities and
commercial paper, mortgage-backed and
asset-backed securities, and similar
securities issued by foreign governments and
corporations.
PRINCIPAL INVESTMENT RISKS The Fund's performance per share will change
daily based on many factors, including the
quality of the instruments in the
Portfolio's investment portfolio, national
and international economic conditions and
general market conditions. You could lose
money on your investment in the Fund or the
Fund could underperform other investments.
</TABLE>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
3
<PAGE> 5
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
<TABLE>
<S> <C>
The Fund could lose money if the issuer of a
fixed income security owned by the Portfolio
defaults on its financial obligation.
Changes in interest rates will affect the
yield and value of the Fund's investments in
debt securities.
The Fund may invest in derivative
instruments (e.g., options and futures
contracts) to help achieve its investment
objectives. The Fund intends to do so
primarily for hedging purposes. These
investments could increase the Fund's price
volatility or reduce the return on your
investment.
The Fund may invest in high-yield
securities, which are subject to higher
credit risks and are less liquid than other
fixed income securities. The Fund could lose
money if it is unable to dispose of these
investments at an appropriate time.
An investment in the Fund is not insured or
guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
</TABLE>
4
<PAGE> 6
<TABLE>
<S> <C>
WHO MAY WANT TO INVEST? Consider investing in the Fund if you are:
- Looking to add a monthly income component
to your investment portfolio
- Seeking higher potential returns than
provided by money market funds
- Willing to accept the risks of price and
income fluctuations
- Investing short-term reserves
This Fund will not be appropriate for
anyone:
- Investing emergency reserves
- Seeking safety of principal
The investment objective and strategies of
the Fund are not fundamental and may be
changed without approval of the Fund
shareholders. If there is a change in the
investment objective of the Fund,
shareholders should consider whether the
Fund remains an appropriate investment in
light of their then current financial
position and needs. There can be no
assurance that the investment objectives of
the Fund or the Portfolio will be achieved.
</TABLE>
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
5
<PAGE> 7
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
<TABLE>
<CAPTION>
<S> <C>
PERFORMANCE BAR
CHART AND TABLE
The bar chart on this
page shows the Republic YEAR-BY-YEAR
Bond Fund's annual TOTAL RETURNS
returns and how its AS OF 12/31
performance has varied FOR CLASS A
from year to year. The SHARES*
bar chart shows changes
in the Fund's yearly
</TABLE>
<TABLE>
performance for the past <CAPTION>
two years to demonstrate <S> <C>
that the Fund has gained 1997 8.50%
and lost value at 1998 6.41%
varying rates over time.
The bar chart assumes
reinvestment of Of course, past performance does not
dividends and indicate how the Fund will perform in the
distributions, but future.
excludes sales charges.
Best quarter: 4Q 1996 +3.61%
Worst quarter: 1Q 1997 -0.38%
*The Fund offers three different classes of
shares: Class A Shares, Class B Shares, and Class
C Shares. Each class of shares has different
characteristics and are subject to different fees
and expenses. The following pages of this
Prospectus will highlight these differences. The
Fund's Statement of Additional Information
contains a more detailed discussion of the
different classes of shares.
</TABLE>
6
<PAGE> 8
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
The table below compares the Fund's performance over time to that of the
Salomon Broad Investment Grade Bond Index, a market-capitalization-based
total return index containing U.S. fixed rate issues of greater than one year
and at least $25 million outstanding, and the Lipper A Rated Bond Fund Index,
an unmanaged, equally weighted index composed of the 30 largest Mutual Funds
with a similar investment objective.
The returns for Class B and Class C Shares will differ from the Class A
returns shown in the bar chart because of differences in expenses of each
class. The table also assumes reinvestment of dividends and distributions,
and includes applicable sales charges.
AVERAGE ANNUAL
TOTAL RETURNS (for
the periods ended
December 31, 1998)
<TABLE>
<CAPTION>
INCEPTION PAST PAST PAST SINCE
DATE YEAR 5 YEARS 10 YEARS INCEPTION
<S> <C> <C> <C> <C> <C>
--------------------------------------------------------
CLASS A Aug. 26, 1996 3.47% N/A N/A 8.44%*
--------------------------------------------------------
CLASS B Jan. 6, 1998 N/A N/A N/A N/A**
--------------------------------------------------------
CLASS C Nov. 3, 1998 N/A N/A N/A N/A**
--------------------------------------------------------
SALOMON BIG BOND INDEX 8.72% 7.31% 9.31% 10.03%***
--------------------------------------------------------
LIPPER A RATED BOND FUND
INDEX 7.43% 6.13% 8.67% 9.61%***
--------------------------------------------------------------------------------------
</TABLE>
* Since Portfolio inception (January 9, 1995). Based on Portfolio
performance adjusted for Fund expenses.
** Average annual return information for Class B and Class C Shares is not
provided because Class B and Class C Shares were outstanding for less than
one year.
*** Since August 31, 1996.
7
<PAGE> 9
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
FEES AND EXPENSES*
<TABLE>
<S> <C> <C> <C> <C>
As an investor in the SHAREHOLDER
Republic Bond Fund, you TRANSACTION EXPENSES
will pay the following (FEES PAID BY YOU A B C
fees and expenses. DIRECTLY) SHARES SHARES SHARES
Shareholder transaction
fees are paid from your Maximum sales
account. Annual Fund charge (load) on
operating expenses are purchases 2.75% None None
paid out of Fund assets, ------------------------------------------------
and are reflected in the Maximum
share price. deferred sales
charge (load) None 3.00% 1.00%
ANNUAL FUND
OPERATING EXPENSES
(FEES PAID FROM FUND A B C
ASSETS) SHARES SHARES SHARES
Management fee .40% .40% .40%
------------------------------------------------
Distribution
(12b-1) fee .00%** .75% .75%
------------------------------------------------
Other expenses 1.21% 1.21% 1.21%
------------------------------------------------
Total fund
operating
expenses 1.61% 2.36% 2.36%
------------------------------------------------
Fee waiver and
expense
reimbursement+ .51% .51% .51%
------------------------------------------------
Net operating
expenses 1.10% 1.85% 1.85%
------------------------------------------------
</TABLE>
* The table reflects the combined fees of both the Bond Fund and the Fixed
Income Portfolio.
** There is a 12b-1 plan for Class A Shares, which authorizes payments up to
.25% of the Fund's assets. To date, no payments under the 12b-1 plan have
been made.
+ Pursuant to an expense limitation agreement.
8
<PAGE> 10
<TABLE>
<CAPTION>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
EXAMPLE*
Use the table at right
to compare fees and <S> <C> <C> <C> <C>
expenses with those of 1 3 5 10
other Funds. It REPUBLIC BOND FUND YEAR YEARS YEARS YEARS
illustrates the amount CLASS A SHARES $384 $722 $1,087 $2,132
of fees and expenses you CLASS B SHARES
would pay, assuming the Assuming Redemption $487 $785 $1,209 $2,200
following: Assuming no
- $10,000 investment Redemption $187 $685 $1,209 $2,200
- 5% annual return CLASS C SHARES
- no changes in the Assuming Redemption $287 $685 $1,209 $2,656
Fund's operating Assuming no
expenses Redemption $187 $685 $1,209 $2,656
</TABLE>
Because this example is
hypothetical and for
comparison only, your
actual costs may be
higher or lower.
* The example reflects the combined fees of both the Bond Fund and the Fixed
Income Portfolio.
[PHOTO OF CLOCK]
9
<PAGE> 11
REPUBLIC NEW YORK TAX-FREE BOND FUND
<TABLE>
<S> <C>
INVESTMENT OBJECTIVES The investment objective of the New York
Tax-Free Bond Fund is to provide
shareholders of the Fund with income exempt
from regular federal, New York State and New
York City personal income taxes.
PRINCIPAL The Fund seeks to achieve its investment
INVESTMENT STRATEGIES objective by investing its assets primarily
in a non-diversified portfolio of municipal
bonds, notes, commercial paper, U.S.
Government securities, and other debt
instruments the interest on which is exempt
from regular federal (except for U.S.
Government securities), New York State and
New York City personal income taxes.
</TABLE>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
10
<PAGE> 12
<TABLE>
<S> <C>
PRINCIPAL The Fund's performance per share will change
INVESTMENT RISKS daily based on many factors, including the
quality of the instruments in the Fund's
investment portfolio, national and
international economic conditions and
general market conditions. You could lose
money on your investment in the Fund or the
Fund could underperform other investments.
The Fund could lose money if the issuer of a
fixed income security owned by the Portfolio
defaults on its financial obligation.
Changes in interest rates will affect the
yield and value of the Fund's investments in
debt securities.
The Fund may invest in derivative
instruments (e.g., option and futures
contracts) to help achieve its investment
objective. The Fund may do so only for
hedging purposes and not for speculation.
These investments could increase the Fund's
price volatility or reduce the return on
your investment.
Because the Fund will concentrate its
investments in New York obligations and may
invest a significant portion of its assets
in the securities of a single issuer or
sector, the value of the Fund's assets could
lose significant value due to the poor
performance of a single issuer or sector.
Historically, New York State and other
issuers of New York Municipal Obligations
have experienced periods of financial
difficulty. Because a significant share of
New York State's economy depends on
financial and business services, any change
in market conditions that adversely affect
these industries could affect the ability of
New York and its localities to meet its
financial obligations. If such difficulties
arise in the future, you could lose money on
your investment.
An investment in the Fund is not insured or
guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
</TABLE>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
11
<PAGE> 13
<TABLE>
<S> <C>
WHO MAY WANT TO INVEST? Consider investing in the Fund if you are:
- Looking to add a monthly tax-exempt income
component to your investment portfolio
- Seeking higher potential returns than
provided by tax-exempt money market funds
- Willing to accept the risks of price and
income fluctuations
- Investing short-term reserves
This Fund will not be appropriate for
anyone:
- Investing emergency reserves
- Seeking safety of principal
- Who does not live in New York
The investment objective and strategies of
the Fund activities are not fundamental and
may be changed without approval of the Fund
shareholders. If there is a change in the
investment objective of the Fund,
shareholders should consider whether the
Fund remains an appropriate investment in
light of their then current financial
position and needs. There can be no
assurance that the investment objectives of
the Fund will be achieved.
</TABLE>
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
12
<PAGE> 14
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
<TABLE>
<CAPTION>
PERFORMANCE BAR
CHART AND TABLE
<S> <C> <C>
The bar chart on this
page shows the Republic YEAR-BY-YEAR
New York Tax-Free Bond TOTAL RETURNS
Fund's annual returns AS OF 12/31
and how its performance FOR CLASS A
has varied from year to SHARES *
year. The bar chart
shows changes in the
</TABLE>
<TABLE>
Fund's yearly <CAPTION>
performance for the past <S> <C>
three years to 1996 3.16%
demonstrate that the 1997 9.20%
Fund has gained and lost 1998 6.12%
value at varying rates
over time. The bar chart
assumes reinvestment of
dividends and
distributions, but
excludes sales charges.
</TABLE>
Of course, past performance does not
indicate how the Fund will perform in the
future.
Best quarter: 4Q 1995 4.27%
Worst quarter: 1Q 1996 -1.70%
*The Fund offers three different classes of
shares through this prospectus: Class A Shares,
Class B Shares, and Class C Shares. The Fund
offers another class of shares pursuant to a
separate prospectus. Each class of shares has
different characteristics and are subject to
different fees and expenses. The following
pages of this Prospectus will highlight these
differences. The Fund's Statement of Additional
Information contains a more detailed discussion
of the different classes of shares.
13
<PAGE> 15
RISK/RETURN SUMMARY AND FUND EXPENSES
logo
The table below compares the Fund's performance over time to that of the
Lehman NY Exempt Index, an index composed of investment grade New York
tax-exempt securities, all having a $50 million minimum maturity value, and
the Lipper NY Municipal Bond Fund Index, an unmanaged, equally weighted index
composed of the 30 largest Mutual Funds with a similar investment objective.
The returns for Class B and Class C Shares will differ from the Class A
returns shown in the bar chart because of differences in expenses of each
class. The table also assumes reinvestment of dividends and distributions,
and includes applicable sales charges.
AVERAGE ANNUAL
TOTAL RETURNS (for
the periods ended
December 31, 1998)
<TABLE>
<CAPTION>
INCEPTION PAST PAST PAST SINCE
DATE YEAR 5 YEARS 10 YEARS INCEPTION
<S> <C> <C> <C> <C> <C>
------------------------------------------------------
CLASS A May 1, 1995 3.24% N/A N/A 6.76%
------------------------------------------------------
CLASS B Jan. 6, 1998 N/A N/A N/A N/A*
------------------------------------------------------
CLASS C Nov. 3, 1998 N/A N/A N/A N/A*
------------------------------------------------------
LEHMAN NY EXEMPT
INDEX 6.88% N/A N/A 8.52%**
------------------------------------------------------
LIPPER NY MUNICIPAL BOND
FUND 7.61% 5.36% 7.61% 7.90%***
-----------------------------------------------------------------------------------
</TABLE>
* Average annual return information for Class B and Class C Shares is not
provided because Class B and Class C Shares were outstanding for less than
one year.
** Since May 1, 1995.
*** Since June 30, 1995.
14
<PAGE> 16
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
FEES AND EXPENSES
<TABLE>
<S> <C> <C> <C>
SHAREHOLDER
TRANSACTION EXPENSES
(FEES PAID BY YOU A B C
DIRECTLY) SHARES SHARES SHARES
Maximum sales charge
(load) on purchases 2.75% None None
Maximum deferred sales
charge (load) None 3.00% 1.00%
ANNUAL FUND
OPERATING EXPENSES
(FEES PAID FROM FUND A B C
ASSETS) SHARES SHARES SHARES
Management fee .25% .25% .25%
Distribution (12b-1)
fee .00%* .75% .75%
Other expenses .95% .95% .95%
Total Fund
operating expenses 1.20% 1.95% 1.95%
Fee waiver and
expense reimbursement+ 0.25% 0.25% 0.25%
Net operating
expenses 0.95% 1.70% 1.70%
</TABLE>
As an investor in the
Republic New York
Tax-Free Bond Fund, you
will pay the following
fees and expenses.
Shareholder transaction
fees are paid from your
account. Annual Fund
operating expenses are
paid out of Fund assets,
and are reflected in the
share price.
* There is a 12b-1 plan for Class A Shares, which authorizes payments up to
.25% of the Fund's assets. To date, no payments under the 12b-1 plan have
been made.
+ Pursuant to an expense limitation agreement.
15
<PAGE> 17
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
EXAMPLE
<TABLE>
Use the table at right
to compare fees and <S> <C> <C> <C> <C>
expenses with those of REPUBLIC NEW YORK 1 3 5 10
other Funds. It TAX-FREE BOND YEAR YEARS YEARS YEARS
illustrates the amount CLASS A SHARES $369 $621 $ 892 $1,665
of fees and expenses you CLASS B SHARES
would pay, assuming the Assuming Redemption $473 $687 $1,027 $1,788
following: Assuming no
- $10,000 investment Redemption $173 $587 $1,027 $1,788
- 5% annual return CLASS C SHARES
- no changes in the Assuming Redemption $273 $587 $1,027 $2,254
Fund's operating Assuming no
expenses Redemption $173 $587 $1,027 $2,254
</TABLE>
Because this example is
hypothetical and for
comparison only, your
actual costs may be
higher or lower.
[PHOTO OF CLOCK]
16
<PAGE> 18
REPUBLIC EQUITY FUND
<TABLE>
<S> <C>
INVESTMENT OBJECTIVES The investment objective of the Equity Fund
is long-term growth of capital and income
without excessive fluctuations in market
value.
PRINCIPAL The Fund seeks to achieve its objective by
INVESTMENT STRATEGIES investing at least 65% of its assets in
equity securities of seasoned medium and
large-sized companies that are expected to
show above average price appreciation. To
achieve its investment objective, the Fund
will pursue two styles of investing.
The "GROWTH" STYLE of investing focuses on
investing in financially secure firms with
established operating histories that are
proven leaders in their industry or market
sector. Such companies may demonstrate
characteristics such as participation in
expanding markets, increasing unit sales
volume, growth in revenues and earnings per
share, and increasing return on investments.
The "VALUE" STYLE of investing focuses on
investing in the equity securities of U.S.
companies believed to be undervalued based
upon internal research and proprietary
valuation systems. Investment decisions are
based on fundamental research, internally
developed valuations systems and seasoned
judgment.
</TABLE>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
17
<PAGE> 19
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
<TABLE>
<S> <C>
PRINCIPAL The Fund's performance per share will change
INVESTMENT RISKS daily based on many factors, including
national and international economic
conditions and general market conditions.
You could lose money on your investment in
the Fund or the Fund could underperform
other investments.
Equity securities have greater price
volatility than fixed income instruments.
The value of the Fund will fluctuate as the
market price of its investments increases or
decreases.
The Fund may invest in derivative
instruments (e.g., option and futures
contracts) to help achieve its investment
objective. The Fund intends to do so
primarily for hedging purposes. These
investments could increase the Fund's price
volatility or reduce the return on your
investment.
An investment in the Fund is not insured or
guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
</TABLE>
18
<PAGE> 20
<TABLE>
<S> <C>
WHO MAY WANT TO INVEST? Consider investing in the Fund if you are:
- Seeking a long-term goal such as
retirement
- Looking to add a growth component to your
investment portfolio
- Willing to accept higher risks of
investing in the stock market in exchange
for potentially higher long-term returns
This Fund will not be appropriate for
anyone:
- Seeking monthly income
- Pursuing a short-term goal or investing
emergency reserves
- Seeking safety of principal
</TABLE>
The investment objective and strategies of the
Fund are not fundamental and may be changed
without approval of the Fund shareholders. If
there is a change in the investment objective of
the Fund, shareholders should consider whether
the Fund remains an appropriate investment in
light of their then current financial position
and needs. There can be no assurance that the
investment objectives of the Fund will be
achieved.
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
19
<PAGE> 21
<TABLE>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
PERFORMANCE BAR
CHART AND TABLE
<S> <C>
The bar chart on this YEAR-BY-YEAR
page shows the Republic TOTAL RETURNS
Equity Fund's annual AS OF 12/31
returns and how its FOR CLASS A
performance has varied SHARES*
from year to year. The
bar chart shows changes
</TABLE>
<TABLE>
in the Fund's yearly <CAPTION>
performance for the past <S> <C>
three years to 1996 15.49%
demonstrate that the 1997 28.37%
Fund has gained value at 1998 29.20%
varying rates over time.
The bar chart assumes
reinvestment of
dividends and Of course, past performance does not
distributions, but indicate how the Fund will perform in
excludes sales charges. the future.
Best quarter: 4Q 1998 +23.30%
Worst quarter: 3Q 1998 -11.52%
*The Fund offers three different classes of shares
through this prospectus: Class A Shares, Class B
Shares, and Class C Shares. The Fund offers another
class of shares pursuant to a separate prospectus.
Each class of shares has different characteristics
and are subject to different fees and expenses. The
following pages of this Prospectus will highlight
these differences. The Fund's Statement of
Additional Information contains a more detailed
discussion of the different classes of shares.
</TABLE>
20
<PAGE> 22
The table below compares the Fund's performance over time to that of the
Russell 1000 Index, an unmanaged index of the 1000 largest U.S. companies
(representing approximately 90% of the total market capitalization) in the
Russell 3000 Index (representing approximately 98% of the U.S. equity market
by capitalization), and the Lipper Growth Fund Index, an unmanaged, equally
weighted index composed of 30 of the largest Mutual Funds with a similar
investment objective.
The returns for Class B and Class C Shares will differ from the Class A
returns shown in the bar chart because of differences in expenses of each
class. The table also assumes reinvestment of dividends and distributions,
and includes applicable sales charges.
AVERAGE ANNUAL
TOTAL RETURNS (for
the periods ended
December 31, 1998)
<TABLE>
<CAPTION>
INCEPTION PAST PAST PAST SINCE
DATE YEAR 5 YEARS 10 YEARS INCEPTION
<S> <C> <C> <C> <C> <C>
-------------------------------------------------------
CLASS A Aug. 1, 1995 24.67% N/A N/A 23.36%
-------------------------------------------------------
CLASS B Jan. 6, 1998 N/A N/A N/A N/A*
(with applicable CDSC)
-------------------------------------------------------
CLASS C Nov. 3, 1998 N/A N/A N/A N/A*
(with applicable CDSC)
-------------------------------------------------------
RUSSELL 1000 INDEX 27.03% 23.36% 19.03% 27.41%**
-------------------------------------------------------
LIPPER GROWTH FUND INDEX 13.88% 16.69% 15.66% 22.78%***
------------------------------------------------------------------------------------
</TABLE>
* Average annual return information for Class B and Class C Shares is not
provided because Class B and Class C Shares were outstanding for less than
one year.
** Since August 1, 1995.
*** Since July 31, 1995.
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
21
<PAGE> 23
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
<TABLE>
FEES AND EXPENSES
<S> <C> <C> <C> <C>
As an investor in the SHAREHOLDER
Republic Equity Fund, TRANSACTION EXPENSES
you will pay the (FEES PAID BY YOU A B C
following fees and DIRECTLY) SHARES SHARES SHARES
expenses. Shareholder
transaction fees are Maximum sales charge
paid from your account. (load) on purchases 3.50% None None
Annual Fund operating Maximum deferred sales
expenses are paid out of charge (load) None 4.00% 1.00%
Fund assets, and are
reflected in the share ANNUAL FUND
price. OPERATING EXPENSES
(FEES PAID FROM FUND A B C
ASSETS) SHARES SHARES SHARES
Management fee .45% .45% .45%
Distribution (12b-1)
fee .00%* .75% .75%
Other expenses .59% .59% .59%
Total Fund operating
expenses 1.04% 1.79% 1.79%
</TABLE>
* There is a 12b-1 plan for Class A Shares, which authorizes payments up to
.25% of the Fund's assets. To date, no payments under the 12b-1 plan have
been made.
22
<PAGE> 24
EXAMPLE
Use the table at right
to compare fees and
expenses with those of
other Funds. It
illustrates the amount
of fees and expenses you
would pay, assuming the
following:
- $10,000 investment
- 5% annual return
- no changes in the
Fund's operating
expenses
Because this example is
hypothetical and for
comparison only, your
actual costs may be
higher or lower.
<TABLE>
<S> <C> <C> <C> <C>
REPUBLIC EQUITY 1 3 5 10
FUND YEAR YEARS YEARS YEARS
CLASS A SHARES $451 $666 $899 $1,565
CLASS B SHARES
Assuming Redemption $581 $760 $964 $1,716
Assuming no
Redemption $181 $560 $964 $1,716
CLASS C SHARES
Assuming Redemption $281 $560 $964 $2,127
Assuming no
Redemption $181 $560 $964 $2,127
</TABLE>
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
23
<PAGE> 25
REPUBLIC OVERSEAS EQUITY FUND
<TABLE>
<S> <C>
INVESTMENT OBJECTIVES The investment objective of the Overseas
Equity Fund is to seek long-term growth of
capital and future income through investment
primarily in securities of non-U.S. issuers
and securities of issuers whose principal
markets are outside of the United States.
PRINCIPAL The Fund seeks to achieve its investment
INVESTMENT STRATEGIES objective by investing all of its assets in
the Republic International Equity Portfolio
(the "Portfolio"), which has the same
investment objective as the Fund. This
two-tier fund structure is commonly referred
to as a "master/feeder" structure because
one fund (the Overseas Equity Fund or
"feeder fund") is investing all its assets
in a second fund (the Portfolio or "master
fund").
The Portfolio will invest primarily in
equity securities of companies organized and
domiciled in developed nations outside the
United States or for which the principal
trading market is outside the United States,
including Europe, Canada, Australia and the
Far East.
</TABLE>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
24
<PAGE> 26
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
<TABLE>
<S> <C>
PRINCIPAL The Fund's performance per share will change
INVESTMENT RISKS daily based on many factors, including
national and international economic
conditions and general market conditions.
You could lose money on your investment in
the Fund or the Fund could underperform
other investments.
Equity securities have greater price
volatility than fixed income instruments.
The value of the Fund will fluctuate as the
market prices of its investments increase or
decrease.
The Fund's investments in foreign securities
are riskier than its investments in U.S.
securities. Investments in foreign
securities may lose value due to unstable
international political and economic
conditions, fluctuations in currency
exchange rates, lack of adequate company
information, as well as other factors.
While the Fund intends to invest primarily
in companies organized and domiciled in
developed nations outside the United States,
the Fund may also invest in emerging
markets. Emerging markets are subject to
even greater price volatility than
investments in foreign securities because
there is a greater risk of political or
social upheaval in emerging markets. In
addition, these investments are often
illiquid and difficult to value accurately.
In January 1999, the European Monetary Union
introduced a common currency for the
European Union (the "euro"). Significant
uncertainty surrounds the effect of the euro
on the value of securities denominated in
local European currencies. The currencies in
which the Fund's assets are denominated may
be devalued against the U.S. dollar,
resulting in a loss to the Fund.
The Fund may invest in derivative
instruments (e.g., option and futures
contracts) to help achieve its investment
objective. The Fund may do so only for
hedging purposes. These investments could
increase the Fund's price volatility or
reduce the return on your investment.
An investment in the Fund is not insured or
guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
</TABLE>
25
<PAGE> 27
<TABLE>
<S> <C>
WHO MAY WANT TO INVEST? Consider investing in the Fund if you are:
- Seeking a long-term goal such as
retirement
- Looking to add a foreign component to your
investment portfolio
- Willing to accept higher risks of
investing in the stock market in exchange
for potentially higher long-term returns
This Fund will not be appropriate for
anyone:
- Seeking monthly income
- Pursuing a short-term goal or investing
emergency reserves
- Seeking safety of principal
The investment objective and strategies of
the Fund are not fundamental and may be
changed without approval of the Fund
shareholders. If there is a change in the
investment objective of the Fund,
shareholders should consider whether the
Fund remains an appropriate investment in
light of their then current financial
position and needs. There can be no
assurance that the investment objectives of
the Fund or the Portfolio will be achieved.
</TABLE>
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
26
<PAGE> 28
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
<TABLE>
<CAPTION>
<S> <C>
PERFORMANCE BAR
CHART AND TABLE
The bar chart on this YEAR-BY-YEAR
page shows the Republic TOTAL RETURNS
Overseas Equity Fund's AS OF 12/31
annual returns and how FOR CLASS A
its performance has SHARES*
varied from year to
year. The bar chart
</TABLE>
<TABLE>
shows changes in the <CAPTION>
Fund's yearly <S> <C>
performance for the past 1997 7.90%
two years to demonstrate 1998 10.56%
that the Fund has gained
value at varying rates
over time. The bar chart Of course, past performance does not
assumes reinvestment of indicate how the Fund will perform in
dividends and the future.
distributions, but
excludes sales charges.
Best quarter: 4Q 1998 +16.30%
Worst quarter: 3Q 1998 -16.10%
*The Fund offers three different classes of
shares: Class A Shares, Class B Shares, and Class
C Shares. Each class of shares has different
characteristics and are subject to different fees
and expenses. The following pages of this
Prospectus will highlight these differences. The
Fund's Statement of Additional Information
contains a more detailed discussion of the
different classes of shares.
</TABLE>
27
<PAGE> 29
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
The table below compares the fund's performance to that of the MSCI EAFE
Index, which includes 1,112 companies in twenty countries representing the
stock markets of Europe, Australia, New Zealand and the Far East, and the
Lipper International Equity Fund Index, an unmanaged, equally weighted index
composed of the 30 largest Mutual Funds with a similar investment objective.
The returns for Class B and Class C Shares will differ from the Class A
returns shown in the bar chart because of differences in expenses of each
class. The table also assumes reinvestment of dividends and distributions,
and includes applicable sales charges.
AVERAGE ANNUAL
TOTAL RETURNS (for
the periods ended
December 31, 1998)
<TABLE>
<CAPTION>
INCEPTION PAST PAST PAST SINCE
DATE YEAR 5 YEARS 10 YEARS INCEPTION
<S> <C> <C> <C> <C> <C>
--------------------------------------------------------
CLASS A Aug. 26, 1996 6.71% N/A N/A 11.28%*
--------------------------------------------------------
CLASS B Jan. 6, 1998 N/A N/A N/A N/A**
(with applicable CDSC)
--------------------------------------------------------
CLASS C Nov. 3, 1998 N/A N/A N/A N/A**
(with applicable CDSC)
--------------------------------------------------------
MSCI EAFE INDEX 20.29% 9.50% 5.85% 11.22%***
--------------------------------------------------------
LIPPER INTERNATIONAL 4.64% 8.20% 8.85% 11.89%***
EQUITY FUND INDEX
-------------------------------------------------------------------------------------
</TABLE>
* Since Portfolio inception (January 9, 1995). Based on Portfolio
performance adjusted for Fund expenses.
** Average annual return information for Class B and Class C Shares is not
provided because Class B and Class C Shares were outstanding for less than
one year.
*** Since August 31, 1996.
28
<PAGE> 30
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
<TABLE>
<CAPTION>
FEES AND EXPENSES*
<S> <C> <C> <C> <C>
As an investor in the SHAREHOLDER
Republic Overseas Equity TRANSACTION EXPENSES
Fund, you will pay the (FEES PAID BY YOU A B C
following fees and DIRECTLY) SHARES SHARES SHARES
expenses. Shareholder
transaction fees are Maximum sales
paid from your account. charge (load) on
Annual Fund operating purchases 3.50% None None
expenses are paid out of Maximum
Fund assets, and are deferred sales
reflected in the share charge (load) None 4.00% 1.00%
price.
ANNUAL FUND
OPERATING EXPENSES
(FEES PAID FROM A B C
FUND ASSETS) SHARES SHARES SHARES
Management fee* .72% .72% .72%
Distribution (12b-1)
and
Service fee .00%** .75% .75%
Other expenses 1.14% 1.14% 1.14%
Total Fund
operating expenses 1.86% 2.61% 2.61%
</TABLE>
* The table reflects the combined fees of both the Overseas Equity Fund and
the International Equity Portfolio.
** There is a 12b-1 plan for Class A Shares, which authorizes payments up to
.25% of the Fund's assets. To date, no payments under the 12b-1 plan have
been made.
29
<PAGE> 31
EXAMPLE*
Use the table at right
to compare fees and
expenses with those of
other Funds. It
illustrates the amount
of fees and expenses you
would pay, assuming the
following:
- $10,000 investment
- 5% annual return
- no changes in the
Fund's operating
expenses
Because this example is
hypothetical and for
comparison only, your
actual costs may be
higher or lower.
<TABLE>
<S> <C> <C> <C> <C>
REPUBLIC OVERSEAS 1 3 5 10
EQUITY FUND YEAR YEARS YEARS YEARS
CLASS A SHARES $532 $ 914 $1,321 $2,453
CLASS B SHARES
Assuming Redemption $664 $1,011 $1,385 $2,595
Assuming no
Redemption $264 $ 811 $1,385 $2,595
CLASS C SHARES
Assuming Redemption $364 $ 811 $1,385 $2,963
Assuming no
Redemption $264 $ 811 $1,385 $2,963
</TABLE>
* The example reflects the combined fees of both the Overseas Equity Fund and
the International Equity Portfolio.
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
30
<PAGE> 32
REPUBLIC OPPORTUNITY FUND
<TABLE>
<S> <C>
INVESTMENT OBJECTIVES The investment objective of the Opportunity
Fund is to seek long-term growth of capital
by investing in equity securities of
emerging small- and medium-sized companies
that are expected to show earnings growth
over time that is well above the growth rate
of the overall economy and the rate of
inflation.
PRINCIPAL The Fund seeks to achieve its investment
INVESTMENT STRATEGIES objective by investing all of its assets in
the Republic Small Cap Equity Portfolio (the
"Portfolio"), which has the same investment
objective as the Fund. This two-tier fund
structure is commonly referred to as a
"master/feeder" structure because one fund
(the Opportunity Fund or "feeder fund") is
investing all its assets in a second fund
(the Portfolio or "master fund").
The Portfolio will invest primarily in
common stocks of small- and medium-sized
companies, but may also invest in bonds,
notes, commercial paper, U.S. Government
securities, and foreign securities. The Fund
may also invest in common stocks of larger,
more established companies if they are
expected to show increased earnings.
</TABLE>
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
31
<PAGE> 33
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
<TABLE>
<S> <C>
PRINCIPAL The Fund's performance per share will change
INVESTMENT RISKS daily based on many factors, including
national and international economic
conditions and general market conditions.
You could lose money on your investment in
the Fund or the Fund could underperform
other investments.
Equity securities have greater price
volatility than fixed income instruments.
The value of the Fund will fluctuate as the
market prices of its investments increase or
decrease.
Because emerging small- and medium-sized
companies have fewer financial resources
than larger, well-established companies,
investments in the Fund are subject to
greater price volatility than investments in
other equity funds that invest in larger,
well-established companies, particularly
during periods of economic uncertainty or
downturns.
The Fund's investments in foreign securities
are riskier than its investments in U.S.
securities. Investments in foreign
securities may lose value due to unstable
international political and economic
conditions, fluctuations in currency
exchange rates, lack of adequate company
information, as well as other factors.
The Fund may invest in derivative
instruments (e.g., option and futures
contracts) to help achieve its investment
objective. The Fund intends to do so
primarily for hedging purposes. These
investments could increase the Fund's price
volatility or reduce the return on your
investment.
An investment in the Fund is not insured or
guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
</TABLE>
32
<PAGE> 34
<TABLE>
<S> <C>
WHO MAY WANT TO INVEST? Consider investing in the Fund if you are:
- Seeking a long-term investment
- Looking to add a growth component to your
portfolio
- Willing to accept higher risks of
investing in emerging companies in exchange
for potentially higher long-term returns
This Fund will not be appropriate for
anyone:
- Seeking monthly income
- Pursuing a short-term goal or
- Investing emergency reserves
The investment objective and strategies of
the Fund are not fundamental and may be
changed without approval of the Fund
shareholders. If there is a change in the
investment objective of the Fund,
shareholders should consider whether the
Fund remains an appropriate investment in
light of their then current financial
position and needs. There can be no
assurance that the investment objectives of
the Fund or the Portfolio will be achieved.
</TABLE>
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
33
<PAGE> 35
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
<TABLE>
<CAPTION>
PERFORMANCE BAR
CHART AND TABLE
<S> <C>
The bar chart on this
page shows the Republic YEAR-BY-YEAR
Opportunity Fund's TOTAL RETURNS
annual returns and how AS OF 12/31
its performance has FOR CLASS A
varied from year to SHARES*
year. The bar chart
shows changes in the
</TABLE>
<TABLE>
Fund's yearly <CAPTION>
performance for the past <S> <C>
two years to demonstrate 1997 21.86%
that the Fund has gained 1998 12.95%
and lost value at
varying rates over time. Of course, past performance does not
The bar chart assumes indicate how the Fund will perform in the
reinvestment of future.
dividends and
distributions, but Best quarter: 4Q 1998 +23.63%
excludes sales charges. Worst quarter: 3Q 1998 -20.18%
</TABLE>
*The Fund offers three different classes of shares:
Class A Shares, Class B Shares, and Class C Shares.
Each class of shares has different characteristics and
are subject to different fees and expenses. The
following pages of this Prospectus will highlight these
differences. The Fund's Statement of Additional
Information contains a more detailed discussion of the
different classes of shares.
34
<PAGE> 36
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
The table below compares the Fund's performance over time with the Russell
2000 Index, an unmanaged index of the 2000 smallest companies (representing
approximately 10% of the total market capitalization) in the Russell 3000
Index (representing approximately 98% of the U.S. equity market by
capitalization), and the Lipper Small Company Fund Index, an unmanaged,
equally weighted index composed of the 30 largest Mutual Funds with a similar
investment objective.
The returns for Class B and Class C shares will differ from the Class A
returns shown in the bar chart because of differences in expenses of each
class. The table also assumes reinvestment of dividends and distributions,
and includes applicable sales charges.
AVERAGE ANNUAL
TOTAL RETURNS (for
the periods ended
December 31, 1998)
<TABLE>
<CAPTION>
INCEPTION PAST PAST PAST SINCE
DATE YEAR 5 YEARS 10 YEARS INCEPTION
<S> <C> <C> <C> <C> <C>
----------------------------------------------------------
CLASS A Sept. 23, 1996 8.96% N/A N/A 16.23%*
----------------------------------------------------------
CLASS B Jan. 6, 1998 N/A N/A N/A N/A**
(with applicable CDSC)
----------------------------------------------------------
CLASS C Nov. 3, 1998 N/A N/A N/A N/A**
(with applicable CDSC)
----------------------------------------------------------
RUSSELL 2000 INDEX -2.55% 11.86% 12.92% 12.14%***
----------------------------------------------------------
LIPPER SMALL COMPANY FUND
INDEX -13.62% 8.60% 11.88% 5.57%****
---------------------------------------------------------------------------------------
</TABLE>
* Since Portfolio inception (January 3, 1996). Based on Portfolio
performance adjusted for Fund expenses.
** Average annual return information for Class B and Class C Shares is not
provided because Class B and Class C Shares were outstanding for less than
one year.
*** Since September 4, 1996.
**** Since September 30, 1996.
35
<PAGE> 37
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
<TABLE>
<CAPTION>
FEES AND EXPENSES*
<S> <C> <C> <C> <C>
As an investor in the SHAREHOLDER
Republic Opportunity TRANSACTION EXPENSES
Fund, you will pay the (FEES PAID BY YOU A B C
following fees and DIRECTLY) SHARES SHARES SHARES
expenses. Shareholder
transaction fees are Maximum sales charge
paid from your account. (load) on purchases 3.50% None None
Annual Fund operating Maximum deferred
expenses are paid out of sales charge (load) None 4.00% 1.00%
Fund assets, and are
reflected in the share ANNUAL FUND
price. OPERATING EXPENSES
(FEES PAID FROM A B C
FUND ASSETS) SHARES SHARES SHARES
Management fee .89% .89% .89%
Distribution (12b-1)
fee .00%** .75% .75%
Other expenses .75% .75% .75%
Total Fund operating
expenses 1.64% 2.39% 2.39%
</TABLE>
* The table reflects the combined fees of both the Opportunity Fund and the
Small Cap Equity Portfolio.
** There is a 12b-1 plan for Class A Shares, which authorizes payments up to
.25% of the funds assets to date, no payments under the 12b-1 plan have been
made.
36
<PAGE> 38
EXAMPLE*
Use the table at right
to compare fees and
expenses with those of
other Funds. It
illustrates the amount
of fees and expenses you
would pay, assuming the
following:
- $10,000 investment
- 5% annual return
- no changes in the
Fund's operating
expenses
Because this example is
hypothetical and for
comparison only, your
actual costs may be
higher or lower.
<TABLE>
<S> <C> <C> <C> <C>
REPUBLIC OPPORTUNITY 1 3 5 10
FUND YEAR YEARS YEARS YEARS
CLASS A SHARES $511 $849 $1,211 $2,226
CLASS B SHARES
Assuming Redemption $642 $945 $1,275 $2,370
Assuming no
Redemption $242 $745 $1,275 $2,370
CLASS C SHARES
Assuming Redemption $342 $745 $1,275 $2,783
Assuming no
Redemption $242 $745 $1,275 $2,783
</TABLE>
* The example reflects the combined fees of both the Opportunity Fund and the
Small Cap Equity Portfolio.
[PHOTO OF CLOCK]
RISK/RETURN SUMMARY AND FUND EXPENSES
LOGO
LOGO
37
<PAGE> 39
INVESTMENT OBJECTIVES AND STRATEGIES
INVESTMENT OBJECTIVES AND STRATEGIES
logo
logo
REPUBLIC BOND FUND
TICKER SYMBOL: CLASS A N/A CLASS B N/A CLASS C N/A
INVESTMENT OBJECTIVE, POLICIES AND STRATEGY
The investment objective of the Bond Fund is to realize above-average total
return, consistent with reasonable risk, through investment primarily in a
diversified portfolio of U.S. Government securities, corporate bonds,
mortgage-backed securities and other fixed income securities. The Fund seeks
to achieve its investment objective by investing all of its assets in the
Republic Fixed Income Portfolio, which has the same investment objective as
the Fund.
Consistent with the investment objectives of the Bond Fund, the Fixed Income
Portfolio:
- will normally invest at least 65% of its total assets in fixed income
securities, which may include U.S. Government securities; corporate debt
securities and commercial paper; mortgage-backed and asset-backed
securities; obligations of foreign governments or international entities;
and foreign currency exchange-related securities.
- may invest more than 50% of its assets in mortgage-backed securities
including mortgage pass-through securities, mortgage-backed bonds and
CMOs, that carry a guarantee of timely payment.
- may lend its securities to brokers, dealers, and other financial
institutions for the purpose of realizing additional income. The Fund or
Portfolio may also borrow money for temporary or emergency purposes.
- may invest in derivative instruments, including, but not limited to,
financial futures, foreign currency futures, foreign currency contracts,
options on futures contracts, options on securities, and swaps.
- may invest in high yield/high risk securities as well as floating and
variable rate instruments and obligations.
- may engage in repurchase transactions, where the Portfolio purchases a
security and simultaneously commits to resell that security to the seller
at an agreed upon price on an agreed upon date.
- may invest in debt obligations by commercial banks and savings and loan
associations. These instruments would include certificates of deposit,
time deposits, and bankers' acceptances.
- may purchase and sell securities on a when-issued basis, in which a
security's price and yield are fixed on the date of the commitment but
payment and delivery are scheduled for a future date.
The Sub-Adviser selects securities for the Portfolio based on various
factors, including the outlook for the economy, and anticipated changes in
interest rates and inflation. The Sub-Adviser may sell securities when it
believes that expected risk-adjusted return is low compared to other
investment opportunities.
38
<PAGE> 40
INVESTMENT OBJECTIVES AND STRATEGIES
logo
REPUBLIC NEW YORK TAX-FREE BOND FUND
TICKER SYMBOL: CLASS A RNYCX CLASS B N/A CLASS C N/A
INVESTMENT OBJECTIVE, POLICIES AND STRATEGY
The investment objective of the New York Tax-Free Bond Fund is to provide
shareholders of the Fund with income exempt from regular federal, New York
State and New York City personal income taxes. The Fund seeks to achieve its
investment objective by investing its assets primarily in a non-diversified
portfolio of municipal bonds, municipal notes, and other debt instruments,
the interest on which is exempt from regular federal, New York State and New
York City personal income taxes.
Consistent with its investment objectives, the New York Tax-Free Bond Fund:
- will invest at least 80% of its assets in tax exempt obligations, and at
least 65%, if not all, of its assets in New York Municipal Obligations.
To the extent that New York Municipal Obligations do not have acceptable
risk- and tax-adjusted returns, the Fund may purchase Municipal
Obligations issued by other states and political subdivisions, the
interest income on which is exempt from regular federal income tax but is
subject to New York State and New York City personal income taxes.
- may invest, as a temporary defensive measure, in short-term obligations
or hold some of its assets in cash. If so, shareholders may have to pay
federal and New York State and New York City personal income taxes on the
interest received on these investments.
- may invest in derivative instruments, including, but not limited to,
options and futures contracts on fixed income securities and indices of
municipal securities.
- may invest in fixed income securities, which may include bonds,
debentures, mortgage securities, notes, bills, commercial paper, and U.S.
Government securities.
- may engage in repurchase transactions, where the Portfolio or Fund
purchases a security and simultaneously commits to resell that security
to the seller at an agreed upon price on an agreed upon date.
- may purchase and sell securities on a when-issued basis, in which a
security's price and yield are fixed on the date of the commitment but
payment and delivery are scheduled for a future date.
The Adviser selects securities for the Portfolio based on various factors,
including the credit quality of the securities, the outlook for the economy,
and anticipated changes in interest rates and inflation. The Adviser may sell
securities when it believes that expected risk-adjusted return is low
compared to other investment opportunities.
39
<PAGE> 41
INVESTMENT OBJECTIVES AND STRATEGIES
INVESTMENT OBJECTIVES AND STRATEGIES
logo
logo
REPUBLIC EQUITY FUND
TICKER SYMBOL: CLASS A REPEX CLASS B N/A CLASS C N/A
INVESTMENT OBJECTIVE, POLICIES AND STRATEGY
The investment objective of the Equity Fund is long-term growth of capital
and income without excessive fluctuations in market value. The Fund seeks to
achieve its objective by investing at least 65% of its assets in equity
securities of seasoned medium and large-sized companies in sound financial
condition that are expected to show above average price appreciation.
To achieve its investment goal, the Fund employs two Sub-Advisers, each of
which pursues a different investment strategy. As investment manager of the
Fund, Republic is responsible for allocating the assets between the
Sub-Advisers. Although Republic usually divides the assets in half, it may
allocate a greater portion of the assets to one of the Sub-Advisers if
Republic believes it is in the best interests of the Fund.
The first Sub-Adviser invests its portion of the Fund's assets using a
"growth" style of investing. The second Sub-Adviser invests the remaining
assets using a "value" style of investing. Each approach relies on a careful
analysis of each company considered for investment, using internal
fundamental research analysis, to determine its source of earnings,
competitive edge, management strength, and level of industry dominance as
measured by market share.
"GROWTH" STRATEGY: The strategy focuses on investing in financially secure
firms with established operating histories that are proven leaders in their
industry or market sector. Such companies may demonstrate characteristics
such as participation in expanding markets, increasing unit sales volume,
growth in revenues and earnings per share, and increasing return on
investments. The Fund's assets may be invested in companies that do not
demonstrate such characteristics if such companies are expected to undergo an
acceleration in growth of earnings because of special factors such as new
management, new products, changes in consumer demand or basic changes in the
economic environment.
"VALUE" STRATEGY: This approach seeks to obtain the Fund's investment
objective by investing in equity securities of U.S. companies believed to be
undervalued based upon internal research and proprietary valuation systems.
Investment decisions are based on fundamental research, internally developed
valuation systems and seasoned judgment. The research focuses on two levels
of analysis: first, on understanding wealth shifts that occur within the
equity market; and second, on individual company research.
40
<PAGE> 42
Consistent with its investment objectives, the Republic Equity Fund:
- may invest in a broad range of equity securities of U.S. and foreign
companies, including debt securities, warrants or rights that can be
converted into common stock.
- may invest in derivative instruments, including, but not limited to,
futures contracts options on securities, securities indices, futures
contracts, and foreign currencies.
- may invest up to 35% in bonds and other debt securities, including lower
rated, high-yield bonds, commonly referred to as "junk bonds."
- may invest without limit in short-term debt and other high-quality, fixed
income securities, including U.S. and foreign government securities,
certificates of deposit and bankers' acceptances of U.S. and foreign
banks, and commercial paper of U.S. or foreign issuers.
- may engage in repurchase transactions, where the Fund purchases a
security and simultaneously commits to resell that security to the seller
at an agreed upon price on an agreed upon date.
- may lend securities to qualified brokers, dealers, banks and other
financial institutions for the purpose of realizing additional income.
INVESTMENT OBJECTIVES AND STRATEGIES
INVESTMENT OBJECTIVES AND STRATEGIES
logo
logo
41
<PAGE> 43
INVESTMENT OBJECTIVES AND STRATEGIES
logo
logo
REPUBLIC OVERSEAS EQUITY FUND
TICKER SYMBOL: CLASS A N/A CLASS B N/A CLASS C N/A
INVESTMENT OBJECTIVE, POLICIES AND STRATEGY
The investment objective of the Overseas Equity Fund is to seek long-term
growth of capital and future income through investment primarily in
securities of non-U.S. issuers and securities whose principal markets are
outside of the United States. The Fund seeks to achieve its investment
objective by investing all of its assets in the International Equity
Portfolio, which has the same investment objective as the Fund. The principal
investments of the International Equity Portfolio will be in equity
securities of companies organized and domiciled in developed nations outside
the United States or for which the principal trading market is outside the
United States, including Europe, Canada, Australia and the Far East.
Consistent with the investment objectives of the Fund, the International
Equity Portfolio:
- will normally invest at least 80% of its total assets in equity
securities of foreign corporations, consisting of common stocks, and
other securities with equity characteristics, including preferred stock,
warrants, rights, securities convertible into common stock, trust
certificates, limited partnership interests and equity participations.
- may invest up to 20% of its assets in equity securities of companies in
emerging markets.
- intends to have at least three different countries represented in its
portfolio and intends to invest primarily in companies with large market
capitalizations.
- may, under exceptional circumstances, temporarily invest part or all of
its assets in fixed income securities denominated in foreign currencies,
domestic or foreign government securities, and nonconvertible preferred
stock, or hold its assets in cash or cash equivalents.
- may invest derivative instruments, including, but not limited to, foreign
currency futures contracts and options on foreign currencies and foreign
currency futures.
- may engage in repurchase transactions, where the Portfolio or Fund
purchases a security and simultaneously commits to resell that security
to the seller at an agreed upon price on an agreed upon date.
- may lend securities to qualified brokers, dealers, banks and other
financial institutions for the purpose of realizing additional income.
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- may purchase and sell securities on a "when-issued" basis, in which a
security's price and yield are fixed on the date of the commitment but
payment and delivery are scheduled for a future date.
The Sub-Adviser's approach to investing relies on extensive field research
and direct company contact. It is a fundamental value-oriented approach that
attempts to identify the difference between the underlying value of a company
and the price of its security in the market.
INVESTMENT OBJECTIVES AND STRATEGIES
INVESTMENT OBJECTIVES AND STRATEGIES
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INVESTMENT OBJECTIVES AND STRATEGIES
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REPUBLIC OPPORTUNITY FUND
TICKER SYMBOL: CLASS A N/A CLASS B N/A CLASS C N/A
INVESTMENT OBJECTIVE, POLICIES AND STRATEGY
The investment objective of the Opportunity Fund is to seek long-term growth
of capital by investing in equity securities of small- and medium-sized
companies that are early in their life cycle but which may have potential to
become major enterprises. These companies would be expected to show earnings
growth over time that is well above the growth rate of the overall economy
and the rate of inflation, and would have the products, management and market
opportunities which are usually necessary to become more widely recognized.
The Fund seeks to achieve its investment objective by investing all of its
assets in the Republic Small Cap Equity Portfolio, which has the same
investment objective as the Fund.
Consistent with the Fund's investment objective, the Small Cap Equity
Portfolio:
- will invest at least 80% of its assets in equity securities, of which at
least 65% will be equity securities issued by small cap companies. Small
cap companies generally are those companies which have small (under $1
billion) market capitalizations and have gross revenues ranging from $10
million to $1 billion.
- may invest in more established companies whose rates of earnings growth
are expected to accelerate because of special factors, such as
rejuvenated management, new products, changes in consumer demand or basic
changes in the economic environment.
- may invest up to 20% of its assets in foreign securities.
- will invest primarily in common stocks, but may, to a limited extent,
seek appreciation in other types of securities when relative values and
market conditions make such purchases appear attractive.
- may invest part or all of its assets in cash (including foreign currency)
or short-term obligations during times of international, political or
economic uncertainty or turmoil, or in order to meet anticipated
redemption requests. These investments may include certificates of
deposit, commercial paper, short-term notes and U.S. Government
securities.
- may invest in derivative instruments, including, but not limited to,
financial and foreign currency futures contracts as well as options on
securities, foreign currencies, and foreign currency futures.
- may invest in fixed income securities, which may include bonds,
debentures, mortgage securities, notes, bills, commercial paper, and U.S.
Government securities.
- may engage in repurchase transactions, where the Portfolio or Fund
purchases a security and simultaneously commits to resell that security
to the seller at an agreed upon price on an agreed upon date.
- may lend securities to qualified brokers, dealers, banks and other
financial institutions for the purpose of realizing additional income.
The Sub-Adviser uses a bottom-up, as opposed to a top-down, investment style
in managing the Fund. Securities are selected based upon fundamental analysis
of a company's cash flow, industry position, potential for high-profit
margins, and strength of management, as well as other factors.
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INVESTMENT RISKS
INVESTMENT RISKS
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GENERAL RISK FACTORS: ALL FUNDS
An investment in the Funds is subject to investment risks, including the
possible loss of the principal amount invested. The Funds' performance per
share will change daily based on many factors, including fluctuation in
interest rates, the quality of the instruments in each Fund's investment
portfolio, national and international economic conditions and general market
conditions.
Generally, the Bond Fund, the New York Tax-Free Fund, the Equity Fund, the
Opportunity Fund, the Overseas Equity Fund, and their corresponding
portfolios, will be subject to the following risks:
- Fixed Income Securities: The value of investments in fixed income
securities will fluctuate as interest rates decrease or increase. In
addition, these securities may accrue income that is distributable to
shareholders even though the income may not yet have been paid to a Fund
or Portfolio. If so, a Fund or Portfolio may need to liquidate some of
its holdings and forego the purchase of additional income-producing
assets.
- Credit Risks: The Funds could lose money if the issuer of a fixed income
security owned by a Fund or Portfolio is unable to meet its financial
obligations.
- Derivatives: The Funds may invest in various types of derivative
securities. Generally, a derivative is a financial arrangement the value
of which is based on (or "derived" from) a traditional security, asset,
or market index. Derivative securities include, but are not limited to,
options and futures transactions, forward foreign currency exchange
contracts, mortgage- and asset-backed securities, "when-issued"
securities, and swaps. There are, in fact, many different types of
derivative securities and many different ways to use them.
The use of derivative securities is a highly specialized activity and
there can be no guarantee that their use will increase the return of the
Funds or protect their assets from declining in value. In fact,
investments in derivative securities may actually lower a Fund's return
if such investments are timed incorrectly or are executed under adverse
market conditions. In addition, the lack of a liquid market for
derivative securities may prevent the Fund from selling unfavorable
positions, which could result in adverse consequences.
Each Fund may invest in different kinds of derivative securities. Each
Fund's Statement of Additional Information contains a detailed
description of the derivative securities in which the Fund may invest and
a discussion of the risks associated with each security. To request a
Statement of Additional Information, please refer to the back cover of
this Prospectus.
- Repurchase Agreements: The use of repurchase agreements involves certain
risks. For example, if the seller of the agreements defaults on its
obligation to repurchase the underlying securities at a time when the
value of these securities has declined, the Portfolio or Fund may incur a
loss upon disposition of the securities. There is also the risk that the
seller of the agreement may become insolvent and subject to liquidation.
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- Illiquid Securities: The Funds may, at times, hold illiquid securities,
by virtue of the absence of a readily available market for certain of its
investments, or because of legal or contractual restrictions on sale. A
Fund could lose money if it is unable to dispose of an investment at a
time that is most beneficial to the Fund.
- Returns Are Not Guaranteed: An investment in the Funds is neither
insured nor guaranteed by the U.S. Government. Shares of the Funds are
not deposits or obligations of, or guaranteed or endorsed by Republic or
any other bank, and the shares are not federally insured by the Federal
Deposit Insurance Corporation, the Federal Reserve Board or any other
agency.
YEAR 2000 RISK:
Like other funds and business organizations around the world, the Funds could
be adversely affected if the computer systems used by the Adviser and the
Funds' other service providers do not properly process and calculate
date-related information for the year 2000 and beyond. In addition, Year 2000
issues may adversely affect companies in which the Funds invest where, for
example, such companies incur substantial costs to address Year 2000 issues
or suffer losses caused by the failure to adequately or timely do so.
The Funds have been assured that the Advisers and the Funds' other service
providers (i.e., Administrator, Transfer Agent, Fund Accounting Agent,
Custodian and Distributor) have developed and are implementing clearly
defined and documented plans intended to minimize risks to services critical
to the Funds' operations associated with Year 2000 issues. Internal efforts
include a commitment to dedicate adequate staff and funding to identify and
remedy Year 2000 issues, and specific actions such as inventorying software
systems, determining inventory items that may not function properly after
December 31, 1999, reprogramming or replacing such systems, and retesting for
Year 2000 readiness. The Funds' Advisers and service providers are likewise
seeking assurances from their respective vendors and suppliers that such
entities are addressing any Year 2000 issues, and each provider intends to
engage, where appropriate, in private and industry or "streetwide" interface
testing of systems for Year 2000 readiness.
In the event that any systems upon which the Funds are dependent are not Year
2000 ready by December 31, 1999, administrative errors and account
maintenance failures would likely occur.
INVESTMENT RISKS
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While the ultimate costs or consequences of incomplete or untimely resolution
of Year 2000 issues by the Advisers or the Funds' service providers cannot be
accurately assessed at this time, the Funds currently have no reason to
believe that the Year 2000 plans of the Advisers and the Funds' service
providers will not be completed by December 31, 1999, or that the anticipated
costs associated with full implementation of their plans will have a material
adverse impact on either their business operations or financial condition of
those of the Funds. The Funds and the Advisers will continue to closely
monitor developments relating to this issue, including development by the
Advisers and the Funds' service providers of contingency plans for providing
back-up computer services in the event of a systems failure or the inability
of any provider to achieve Year 2000 readiness. Separately, the Advisers will
monitor potential investment risk related to Year 2000 issues.
SPECIFIC RISK FACTORS: FOREIGN AND HIGH YIELD/ HIGH RISK SECURITIES
<TABLE>
<S> <C>
BOND FUND EQUITY FUND
OPPORTUNITY FUND OVERSEAS EQUITY FUND
</TABLE>
Foreign securities involve investment risks different from those associated
with domestic securities. Foreign investments may be riskier than U.S.
investments because of unstable international political and economic
conditions, foreign controls on investment and currency exchange rates,
withholding taxes, or a lack of adequate company information, liquidity, and
government regulation.
In January 1999, the European Monetary Union introduced a common currency for
the European Union (the "euro"). Significant uncertainty surrounds the effect
of the euro on the value of securities denominated in local European
currencies. If the Fund or Portfolio holds investments in countries with
currencies replaced by the euro, those investments may be devalued against
the U.S. dollar, resulting in a loss to the Fund.
Investments in foreign emerging markets present greater risk than investing
in foreign issuers in general. The risk of political or social upheaval is
greater in foreign emerging markets. In addition, a number of emerging
markets restrict foreign investment in stocks. Inflation and rapid
fluctuations in inflation rates have had and may continue to have negative
effects on the economies and securities markets of certain emerging market
countries. Moreover, many of the emerging securities markets are relatively
small, have low trading volumes, suffer periods of relative illiquidity, and
are characterized by significant price volatility.
INVESTMENT RISKS
INVESTMENT RISKS
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INVESTMENT RISKS
INVESTMENT RISKS
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High yield/high risk securities may be more susceptible to real or perceived
adverse economic and competitive industry conditions than higher grade
securities. If the issuer of high yield/high risk securities defaults, the
Fund or Portfolio may incur additional expenses to seek recovery. High
yield/high risk securities may be less liquid than the market for higher
grade securities. Less liquidity in the secondary trading markets could
adversely affect and cause large fluctuations in the daily net asset value of
the Funds.
SPECIFIC RISK FACTORS: "WHEN-ISSUED" SECURITIES
BOND FUND
NEW YORK TAX-FREE BOND FUND
OVERSEAS EQUITY FUND
The price and yield of securities purchased on a "when-issued" basis is fixed
on the date of the commitment but payment and delivery are scheduled for a
future date. Consequently, these securities present a risk of loss if the
other party to a "when-issued" transaction fails to deliver or pay for the
security. In addition, purchasing securities on a "when-issued" basis can
involve a risk that the yields available in the market on the settlement date
may actually be higher (or lower) than those obtained in the transaction
itself and, as a result, the "when-issued" security may have a lesser (or
greater) value at the time of settlement than the Fund's payment obligation
with respect to that security.
SPECIFIC RISK FACTORS: MORTGAGE-BACKED SECURITIES
BOND FUND
Mortage- and asset-backed securities are debt instruments that are secured by
interests in pools of mortgage loans or other financial assets. Mortgage- and
asset-backed securities are subject to prepayment, extension, market, and
credit risks. Prepayment risk reflects the risk that borrowers may prepay
their mortgages faster than expected, thereby affecting the investment's
average life and perhaps its yield. Conversely, an extension risk is present
during periods of rising interest rates, when a reduction in the rate of
prepayments may significantly lengthen the effective durations of such
securities. Market risk reflects the risk that the price of the security may
fluctuate over time as a result of changing interest rates or the lack of
liquidity. Credit risk reflects the risk that the Fund or Portfolio may not
receive all or part of its principal because the issuer has defaulted on its
obligations.
A swap is an agreement to change the return generated by one instrument for
the return generated by another instrument. The use of swaps is a highly
specialized activity that involves investment techniques and risks different
from those associated with ordinary portfolio securities transactions. If the
other party to the swap defaults, the Fund or Fixed Income Portfolio may lose
interest payments that it is contractually entitled to receive and may, in
some cases, lose the entire principal value of the investment security.
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SPECIFIC RISK FACTORS: NON-DIVERSIFICATION
NEW YORK TAX-FREE BOND FUND
Because the Fund will concentrate its investments in New York and may
concentrate a significant portion of its assets in the securities of a single
issuer or sector, investment in this Fund may pose investment risks greater
than those posed by a more broadly diversified portfolio. Consequently,
unlike a more diversified portfolio, the value of the Fund's assets could
lose significant value due to the poor performance of a single issuer or
sector.
The Fund may also be subject to credit risks. Historically, New York State
and other issuers of New York Municipal Obligations have experienced periods
of financial difficulty. Because a significant share of New York State's
economy depends on financial and business services, any change in market
conditions that adversely affect these industries could affect the ability of
New York and its localities to meet its financial obligations. The financial
stability of New York State is closely related to the financial stability of
its localities, particularly New York City, which has required and continues
to require significant financial assistance from New York. For example, in
1975, the State took action to restore the financial health of New York City
by establishing, among other things, a supervisory system that monitored the
City's finances. To the extent that New York City and other New York
localities require the State's assistance, the ability of the State to meet
its own obligations as they come due or to obtain additional financing could
be adversely affected. If this occurs, you could lose money on your
investment.
INVESTMENT RISKS
INVESTMENT RISKS
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FUND MANAGEMENT
FUND MANAGEMENT
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THE INVESTMENT ADVISER
Republic National Bank of New York ("Republic" or the "Adviser"), 452 Fifth
Avenue, New York, New York 10018, is the investment adviser for the New York
Tax-Free Bond Fund. Republic is also the investment manager for the Equity
Fund, the Fixed Income Portfolio, the International Portfolio, and the Small
Cap Equity Portfolio. As investment manager of the Equity Fund and the
Portfolios, Republic provides general supervision over the investment
management functions performed by the investment advisers.
Republic is a wholly owned subsidiary of Republic New York Corporation, a
registered bank holding company. As of September 30, 1998, Republic was the
17th largest commercial bank in the United States as measured by deposits.
Republic currently provides investment advisory services for individuals,
trusts, estates and institutions. Republic manages more than $31.9 billion in
assets including $1.39 billion in the Republic Family of Funds.
The following companies serve as investment advisers of their respective Fund
and Portfolios. The investment advisers make the day-to-day investment
decisions and continuously review, supervise and administer investment
programs.
The Bond Fund (Fixed Income Portfolio): Miller Anderson & Sherrard ("MAS"),
One Tower Bridge, West Conshohocken, Pennsylvania 19428, is a Pennsylvania
limited partnership founded in 1969. MAS provides investment services to
employee benefit plans, endowment funds, foundations and other institutional
investors. As of December 31, 1998, MAS had in excess of $1.62 billion in
assets under management.
The New York Tax-Free Bond Fund: Republic serves as the investment adviser
to the Fund. A description of Republic's experience in investment management
is set forth above.
The Equity Fund: Alliance Capital Management L.P. ("Alliance"), 1345 Avenue
of the Americas, New York, New York 10105, and Brinson Partners, Inc.
("Brinson"), 209 South LaSalle Street, Chicago, IL 60604, both serve as
investment advisers to the Equity Fund. Alliance pursues a "growth" style of
investing, while Brinson pursues a "value" style of investing. As investment
manager, Republic is responsible for allocating the Fund's assets between
Alliance and Brinson for purposes of investment.
Alliance is a leading global investment adviser supervising client accounts
with assets totaling $286.7 billion as of December 31, 1998. Alliance's
clients are primarily major corporate employee benefit funds, public employee
retirement systems, investment companies, foundations and endowment funds.
Brinson is an investment management firm managing, as of September 30, 1998,
approximately $1.63 billion, primarily for pension and profit sharing
institutional accounts. Brinson and its predecessor entities have managed
domestic and
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THE INVESTMENT ADVISER
CONTINUED
international investment assets since 1974 and global investment assets since
1982. Brinson also serves as the investment adviser to seven other investment
companies.
The Overseas Equity Fund (International Equity Portfolio): Capital Guardian
Trust Company ("CGTC"), which was founded in 1968, is a wholly owned
subsidiary of The Capital Group Companies, Inc., both of which are located at
333 South Hope Street, Los Angeles, California. As of December 31, 1998, CGTC
managed $83 billion of assets primarily for large institutional clients.
The Opportunity Fund (Small Cap Equity Portfolio): MFS Institutional
Advisers, Inc. ("MFSI"), together with its parent company Massachusetts
Financial Services Company ("MFS"), is America's oldest mutual fund
organization. MFSI has its principal office at 500 Boylston Street, Boston,
MA 02116. Net assets under the management of the MFS organization were
approximately $97.8 billion on behalf of over two million investor accounts
as of December 31, 1998. As of that date, the MFS organization managed
approximately $72.7 billion of assets invested in equity securities, and
approximately $25.1 billion of assets invested in fixed income securities.
For these advisory and management services, the Funds paid a management fee
as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF
AVERAGE NET ASSETS
AS OF 10/31/98*
<S> <C>
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Bond Fund 0.36%
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New York Tax-Free Bond Fund 0.23%
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Equity Fund 0.38%
------------------------------
Overseas Equity Fund 0.78%
------------------------------
Opportunity Fund 0.99%
-----------------------------------------------------------------------
</TABLE>
* Republic waived a portion of its contractual fees with the New York
Tax-Free Bond Fund and Opportunity Fund for the most recent fiscal year.
Actual fees paid on behalf of the Funds and Portfolios during the previous
fiscal year may be higher than the current contractual fee due to break
points in the Advisor's Fee, which are based on the value of the assets in
the Fund or Portfolio.
FUND MANAGEMENT
FUND MANAGEMENT
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FUND MANAGEMENT
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PORTFOLIO MANAGERS
THE BOND FUND (FIXED INCOME PORTFOLIO)
- The Portfolio Manager for the Fixed Income Portfolio is Kenneth B.
Dunn. Mr. Dunn has been a Partner at MAS since prior to 1991. He has
served as the Portfolio Manager of the MAS Fixed Income and MAS
Domestic Fixed Income Portfolios since 1987; the MAS Fixed Income II
Portfolio since 1990; the MAS Mortgage-Backed Securities and Special
Purpose Fixed Income Portfolios, since 1992; and the MAS Municipal and
PA Municipal Portfolios, since 1994.
THE NEW YORK TAX-FREE BOND FUND:
- Peter J. Loftus, Senior Portfolio Manager with Republic since 1997, is
primarily responsible for the day-to-day management of the New York
Tax-Free Bond Fund's portfolio. Prior to joining Republic, Mr. Loftus
was a Senior Vice President at Dillon, Read & Co. from August, 1992
through August, 1997, where he managed tax-exempt trading and hedging
for the firm. He also spent seven years (1984 -- 1992) at Paine Webber
as a Vice President involved in the trading and distribution of
tax-exempt securities.
THE EQUITY FUND:
- John L. Blundin, an Executive Vice President and Portfolio Manager and
Discipline Growth Team Leader, and Christopher Toub, a Senior Vice
President, Equity Portfolio Manager, and Director of Global Equity
Research have primary portfolio management responsibility for the
Equity Fund's assets allocated to Alliance. In all, Mr. Blundin has 34
years of investment experience. For 26 years, including the last five
years, Mr. Blundin has served as a portfolio manager at Alliance. Mr.
Toub has 17 years of investment experience, including the last five
years of experience as a portfolio manager at Alliance.
* Jeffrey J. Diermeier, Managing Partner-U.S. Equities at Brinson, has
primary portfolio management responsibility for the Fund's assets
allocated to Brinson. Including the last five years, Mr. Diermeier has
21 years of investment experience at Brinson.
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PORTFOLIO MANAGERS
CONTINUED
THE OVERSEAS EQUITY FUND (INTERNATIONAL EQUITY PORTFOLIO):
The following persons are primarily responsible for portfolio management of
the International Equity Portfolio:
- David Fisher, Chairman of CGTC, has had 32 years experience as an
investment professional (28 years with CGTC or its affiliates,
including the last five years).
- Harmut Giesecke, Senior Vice President and Director of Capital
International, Inc., has had 26 years experience as an investment
professional (24 years with CGTC or its affiliates, including the last
five years).
- Nancy Kyle, Senior Vice President of CGTC, has had 24 years experience
as an investment professional (7 years with CGTC or its affiliates,
including the last five years). From 1980 to 1990, Ms. Kyle was
managing director of J. P. Morgan Investment Management, Inc.
- John McIlwraith, Senior Vice President of CGTC, has had 28 years
experience as an investment professional (14 years with CGTC or its
affiliates, including the last five years).
- Robert Ronus, President of CGTC, has had 29 years experience as an
investment professional (23 years with CGTC or its affiliates,
including the last five years).
- Nilly Sikorsky, Director of The Capital Group Companies, Inc., has had
35 years experience as an investment professional, all of which was
with CGTC or its affiliates.
FUND MANAGEMENT
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PORTFOLIO MANAGERS
CONTINUED
OPPORTUNITY FUND (SMALL CAP EQUITY PORTFOLIO):
- The portfolio manager of the Small Cap Equity Portfolio is Brian
Stack, Senior Vice President of MFSI. Mr. Stack has been employed by
MFSI since 1993.
THE DISTRIBUTOR AND ADMINISTRATOR
BISYS Fund Services ("BISYS"), whose address is 3435 Stelzer Road, Columbus,
Ohio 43219-3035, serves as the Funds' administrator. Management and
administrative services of BISYS include providing office space, equipment
and clerical personnel to the Funds and supervising custodial, auditing,
valuation, bookkeeping, legal and dividend dispersing services.
BISYS also serves as the distributor of the Funds' shares. BISYS may provide
financial assistance in connection with pre-approved seminars, conferences
and advertising to the extent permitted by applicable state or
self-regulatory agencies, such as the National Association of Securities
Dealers.
Each Fund's Statement of Additional Information has more detailed information
about the Investment Adviser, Distributor and Administrator, and other
service providers.
FUND MANAGEMENT
FUND MANAGEMENT
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THE TWO-TIER FUND STRUCTURE
The Bond Fund, Overseas Equity Fund, and Opportunity Fund seek to achieve
their investment objectives by investing all of each Fund's assets in the
Republic Fixed Income Portfolio, Republic International Equity Portfolio, and
the Republic Small Cap Equity Portfolio, respectively, series of a separate
open-end investment company, each having the same investment objectives as
their respective Funds. This is referred to as a "master/feeder" arrangement
because one fund (the "feeder" fund) "feeds" its assets into another fund
(the "master fund"). The two-tier investment fund structure has been
developed relatively recently, so shareholders should carefully consider this
investment approach. For example, other mutual funds and institutional
investors may invest in the Portfolios on the same terms and conditions as
the Funds (although they may have different sales commissions and other
operating expenses that may generate different returns). As with
traditionally structured funds which have large investors, the actions of
these mutual funds and institutional investors (or other large investors) may
have a material effect on smaller investors in the Fund. For example, if a
large investor withdraws from a portfolio (a "master fund"), operating
expenses may increase, thereby producing lower returns for investors in the
Funds ("feeder funds"). Additionally, the portfolio may become less diverse,
resulting in increased portfolio operating expenses.
Except as permitted, whenever a Fund is requested to vote on a matter
pertaining to its corresponding Portfolio, the Fund will hold a meeting of
its shareholders. At the meeting of investors in the Portfolio, the Fund will
cast all of its votes in the same proportion as the votes of the Fund's
shareholders.
The investment objectives of the Funds and the Portfolios may be changed
without approval of the shareholders. A Fund may withdraw its investment in
its corresponding Portfolio as a result of certain changes in the Portfolio's
investment objective, policies or restrictions or if it is in the best
interests of the Fund to do so.
FUND MANAGEMENT
FUND MANAGEMENT
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PRICING OF FUND SHARES
-----------------------
HOW NAV IS CALCULATED
The NAV is calculated
by adding the total
value of a Fund's
investments and other
assets, subtracting its
liabilities and then
dividing that figure by
the number of
outstanding shares of
the Fund:
NAV =
Total Assets -
Liabilities
-----------------------
Number of Shares
Outstanding
-----------------------
Values of assets in a
Fund's portfolio or
held by a Portfolio are
determined on the basis
of their market or
other fair value.
THE INCOME AND EQUITY FUNDS
The net asset value per share (NAV) of
the Bond Fund and the New York Tax-Free
Bond Fund (collectively, the "Income
Funds"), and the Equity Fund, the
Overseas Equity Fund, and the
Opportunity Fund (collectively, the
"Equity Funds"), is determined once each
day at the close of regular trading on
the New York Stock Exchange, normally at
4 p.m. Eastern time on days the Exchange
is open.
The New York Stock Exchange is open
every weekday except for the days on
which the following holidays are
observed: New Year's Day, Martin Luther
King, Jr. Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day, and
Christmas Day.
Your order for purchase, sale or
exchange of shares is priced at the next
NAV calculated after your order is
accepted by the Fund plus any applicable
sales charge. If you sell Class B Shares
or Class C Shares, a contingent deferred
sales load may apply, which would reduce
the amount of money paid to you by the
Fund. For more information about sales
charges, see the section on
"Distribution Arrangements/Sales
Charges."
PURCHASING AND ADDING TO YOUR SHARES
You may purchase Funds through the Republic Funds Distributor or through
banks, brokers and other investment representatives, which may charge
additional fees and may require higher minimum investments or impose other
limitations on buying and selling shares. If you purchase shares through an
investment representative, that party is responsible for transmitting
orders by close of business and may have an earlier cut-off time for
purchase and sale requests. Consult your investment representative or
institution for specific information.
SHAREHOLDER INFORMATION
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PURCHASING AND ADDING TO YOUR SHARES
All purchases must be in
U.S. dollars. A fee will
be charged for any
checks that do not
clear. Third-party
checks are not accepted.
A Fund may waive its
minimum purchase
requirement and the
Distributor may reject a
purchase order if it
considers it in the best
interest of the Fund and
its shareholders.
<TABLE>
<CAPTION>
MINIMUM
INITIAL MINIMUM
ACCOUNT TYPE INVESTMENT SUBSEQUENT
<S> <C> <C>
Class A Regular
(non-retirement) $1,000 $ 100
-----------------------------------------------
Retirement (IRA) $ 250 $ 100
-----------------------------------------------
Automatic Investment
Plan $ 250 $ 25
</TABLE>
AVOID 31% TAX WITHHOLDING
The Funds are required to withhold 31% of taxable dividends, capital gains
distributions and redemptions paid to shareholders who have not provided the
Funds with their certified taxpayer identification number in compliance with
IRS rules, or if you have been notified by the IRS that you are subject to
backup withholding. Backup withholding is not an additional tax; rather it is
a way in which the IRS ensures that it will collect taxes otherwise due. Any
amounts withheld may be credited against your U.S. federal income tax
liability. To avoid this, make sure you provide your correct Tax
Identification Number (Social Security Number for most investors) on your
account application.
SHAREHOLDER INFORMATION
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<PAGE> 59
SHAREHOLDER INFORMATION
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PURCHASING AND ADDING TO YOUR SHARES
CONTINUED
INSTRUCTIONS FOR OPENING OR ADDING TO AN ACCOUNT
logoBY REGULAR MAIL OR BY OVERNIGHT SERVICE
Initial Investment:
If purchasing through your financial adviser or brokerage account, simply
tell your adviser or broker that you wish to purchase shares of the Funds and
he or she will take care of the necessary documentation. For all other
purchases, follow the instructions below.
1. Carefully read, complete, and sign the account application. Establishing
your account privileges now saves you the inconvenience of having to add
them later.
2. Make check, bank draft or money order payable to "Republic Funds" and
include the name of the appropriate Fund(s) on the check.
3. Mail to: Republic Funds, 3435 Stelzer Road, Columbus, Ohio 43219-3035.
Subsequent:
1. Use the investment slip attached to
your account statement.
Or, if unavailable,
2. Include the following information in
writing:
- Fund name
- Share class
- Amount invested
- Account name
- Account number
Include your account number on your
check.
3. Mail investment slip and check to: Republic Funds, 3435 Stelzer Road,
Columbus, Ohio 43219-3035.
logoELECTRONIC PURCHASES
Your bank must participate in the Automated Clearing House (ACH) and must be
a United States Bank. Your bank or broker may charge for this service.
Establish electronic purchase option on your account application or call
1-888-525-5757. Your account can generally be set up for electronic purchases
within 15 days.
Call 1-888-525-5757 to arrange a transfer from your bank account.
ELECTRONIC VS. WIRE TRANSFER
Wire transfers allow
financial institutions to
send funds to each other,
almost instantaneously. With
an electronic purchase or
sale, the transaction is
made through the Automated
Clearing House (ACH) and may
take up to eight days to
clear. There is generally no
fee for ACH transactions.
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<PAGE> 60
PURCHASING AND ADDING TO YOUR SHARES
CONTINUED
logoBY WIRE TRANSFER
Note: Your bank may charge a wire transfer fee.
For initial investment:
Fax the completed application, along with a request for a confirmation number
to 1-888-525-5757. Follow the instructions below after receiving your
confirmation number.
For initial and subsequent investments:
Instruct your bank to wire transfer your investment to: The Republic Funds,
3435 Stelzer Road, Columbus, Ohio 43219-3035, Attn. Transfer Agent.
Name of Bank
Routing Number: ABA #011001438
Acct. #5999-99451
Include:
Your name
Your confirmation number
After instructing your bank to wire the funds, call 888-525-5757 to advise us
of the amount being transferred and the name of your bank
You can add to your account by using the convenient options described below.
The Funds reserve the right to change or eliminate these privileges at any
time with 60 days notice.
SHAREHOLDER INFORMATION
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<PAGE> 61
SHAREHOLDER INFORMATION
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PURCHASING AND ADDING TO YOUR SHARES
CONTINUED
AUTOMATIC INVESTMENT PLAN
You can make automatic investments in the
Funds from your bank account, through
payroll deduction or from your federal
employment, Social Security or other
regular government checks. Automatic
investments can be as little as $25, once
you've invested the $250 minimum required
to open the account.
To invest regularly from your bank
account:
Complete the Automatic Investment Plan
portion on your Account Application.
Make sure you note:
J Your bank name, address and account
number
J The amount you wish to invest
automatically (minimum $25)
J How often you want to invest (every
month, 4 times a year, twice a year
or once a year)
J Attach a voided personal check.
To invest regularly from your paycheck or
government check:
Call 1-888-525-5757 for an enrollment
form.
DIRECTED DIVIDEND OPTION
By selecting the appropriate
box in the Account
Application, you can elect to
receive your distributions in
cash (check) or have
distributions (capital gains
and dividends) reinvested in
another Republic Fund without
a sales charge. You must
maintain the minimum balance
in each Fund into which you
plan to reinvest dividends or
the reinvestment will be
suspended and your dividends
paid to you. The Fund may
modify or terminate this
reinvestment option without
notice. You can change or
terminate your participation
in the reinvestment option at
any time.
-----------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS
All dividends and distributions will be automatically reinvested unless you
request otherwise. There are no sales charges for reinvested distributions.
Dividends are higher for Class A shares than for Class B and C shares,
because Class A shares have lower distribution expenses. Capital gains are
distributed at least annually.
Distributions are made on a per share basis regardless of how long you've
owned your shares. Therefore, if you invest shortly before the distribution
date, some of your investment will be returned to you in the form of a
distribution.
-----------------------------------------------------------------------------
60
<PAGE> 62
SHAREHOLDER INFORMATION
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SELLING YOUR SHARES
You may sell your shares at
any time. Your sales price
will be the next NAV after
your sell order is received
by the Fund, its transfer
agent, or your investment
representative. Normally
you will receive your
proceeds within a week
after your request is
received. See section on
"General Policies on
Selling Shares" below.
WITHDRAWING MONEY FROM YOUR FUND
INVESTMENT
As a mutual fund shareholder, you are
technically selling shares when you
request a withdrawal in cash. This is
also known as redeeming shares or a
redemption of shares.
CONTINGENT DEFERRED SALES CHARGE
When you sell Class B or C shares, you
will be charged a fee for any shares
that have not been held for a sufficient
length of time. These fees will be
deducted from the money paid to you. See
the section on "Distribution
Arrangements/Sales Charges" below for
details.
INSTRUCTIONS FOR SELLING SHARES
If selling your shares through your financial adviser or broker, ask him or
her for redemption procedures. Your adviser and/or broker may have
transaction minimums and/or transaction times which will affect your
redemption. For all other sales transactions, follow the instructions below.
logoBY TELEPHONE
(unless you have declined telephone sales privileges)
1. Call 1-888-525-5757 with instructions as to how you wish to receive your
funds (mail, wire, electronic transfer). (See "General Policies on
Selling Shares -- Verifying Telephone Redemptions" below)
logoBY MAIL OR OVERNIGHT SERVICE
(See "General Policies on Selling Shares -- Redemptions in Writing Required"
below)
1. Call 1-888-525-5757 to request redemption forms or write a letter of
instruction indicating:
- your Fund and account number
- amount you wish to redeem
- address where your check should be sent
- account owner signature
2. Mail to: Republic Funds, 3435 Stelzer Road Columbus, Ohio 43219-3035.
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<PAGE> 63
SELLING YOUR SHARES
CONTINUED
logoWIRE TRANSFER
You must indicate this option on your account application.
Call 1-888-525-5757 to request a wire transfer.
If you call by 4 p.m. Eastern time, your payment will normally be wired to
your bank on the next business day. Otherwise, it will normally be wired on
the second business day after your call.
The Fund may charge a wire transfer fee.
NOTE: Your financial institution may also charge a separate fee.
logoELECTRONIC REDEMPTIONS
Call 1-888-525-5757 to request an electronic redemption.
Your bank must participate in the Automated Clearing House (ACH) and must be
a U.S. bank.
If you call by 4 p.m. Eastern time, the NAV of your shares will normally be
determined on the same day and the proceeds credited within 8 days.
Your bank may charge for this service.
SYSTEMATIC WITHDRAWAL PLAN
You can receive automatic payments from your account on a monthly, quarterly,
semi-annual or annual basis. The minimum withdrawal is $50. To activate this
feature: Make sure you've checked the appropriate box on the Account
Application, or call 1-888-525-5757.
- Include a voided personal check.
- Your account must have a value of $10,000 or more to start withdrawals.
- If the value of your account falls below $1,000, you may be asked to add
sufficient funds to bring the account back to $1,000, or the Fund may
close your account and mail the proceeds to you.
SHAREHOLDER INFORMATION
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<PAGE> 64
SELLING YOUR SHARES
CONTINUED
REDEMPTIONS IN WRITING REQUIRED
You must request redemption in writing in the following situations:
1. Redemptions from Individual Retirement Accounts ("IRAs").
2. Redemption requests requiring a signature guarantee which include each of
the following:
- Redemptions over $10,000
- Your account registration or the name(s) in your account has changed
within the last 15 days
- The check is not being mailed to the address on your account
- The check is not being made payable to the owner of the account
- The redemption proceeds are being transferred to another Fund account
with a different registration.
You must obtain a signature guarantee from members of the STAMP (Securities
Transfer Agents Medallion Program), MSP (New York Stock Exchange Signature
Program) or SEMP (Stock Exchanges Medallion Program). Members are subject to
dollar limitations which must be considered when requesting their guarantee.
The Transfer Agent may reject any signature guarantee if it believes the
transaction would otherwise be improper.
VERIFYING TELEPHONE REDEMPTIONS
The Funds make every effort to insure that telephone redemptions are only
made by authorized shareholders. All telephone calls are recorded for your
protection and you will be asked for information to verify your identity.
Given these precautions, unless you have specifically indicated on your
application that you do not want the telephone redemption feature, you may be
responsible for any fraudulent telephone orders. If appropriate precautions
have not been taken, the Transfer Agent may be liable for losses due to
unauthorized transactions.
SHAREHOLDER INFORMATION
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<PAGE> 65
SELLING YOUR SHARES
CONTINUED
REDEMPTIONS WITHIN 15 DAYS OF INITIAL INVESTMENT
When you have made your initial investment by check, you cannot redeem any
portion of it until the Transfer Agent is satisfied that the check has
cleared (which may require up to 15 business days). You can avoid this delay
by purchasing shares with a certified check.
REFUSAL OF REDEMPTION REQUEST
Payment for shares may be delayed under extraordinary circumstances or as
permitted by the SEC in order to protect remaining shareholders.
CLOSING OF SMALL ACCOUNTS
If your account falls below $50 due to redemptions, the Fund may ask you to
increase your balance. If it is still below $50 after 30 days, the Fund may
close your account and send you the proceeds at the current NAV.
UNDELIVERABLE REDEMPTION CHECKS
For any shareholder who chooses to receive distributions in cash, if
distribution checks (1) are returned and marked as "undeliverable" or (2)
remain uncashed for six months, your account will be changed automatically so
that all future distributions are reinvested in your account. Checks that
remain uncashed for six months will be canceled and the money reinvested in
the Fund.
SHAREHOLDER INFORMATION
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<PAGE> 66
DISTRIBUTION ARRANGEMENTS/SALES CHARGES
This section describes the sales charges and fees you will pay as an investor
in different share classes offered by the Bond Fund and New York Tax-Free
Bond Fund (collectively, the "Income Funds") and the Equity Fund, the
Overseas Equity Fund, and the Opportunity Fund (collectively, the "Equity
Funds").
THE INCOME FUNDS
<TABLE>
<S> <C> <C> <C>
CLASS A SHARES CLASS B SHARES CLASS C SHARES
Sales Charge (Load) Percentage of No front-end No front-end
Investment: sales charge. A sales charge. A
contingent contingent
2.75% deferred sales deferred sales
Less than $50,000 charge (CDSC) charge (CDSC)
$50,000 but less than 1.75% may be imposed may be imposed
$100,000 on shares on shares
$100,000 but less 1.25% redeemed within redeemed within
than $250,000 three years one year after
$250,000 but less 1.00% after purchase. purchase.
than $500,000 None Shares
$500,000 and over automatically
convert to Class
A Shares after 5
years.
Distribution (12b-1) Subject to Subject to Subject to
and Service Fees combined annual combined annual combined annual
distribution and distribution and distribution and
shareholder shareholder shareholder
servicing fees servicing fees servicing fees
of up to .25% of up to 1.00% of up to 1.00%
annually of the annually of the annually of the
Fund's total Fund's average Fund's average
average daily daily net daily net
net assets. assets. assets.
Fund Expenses Lower annual Higher annual Higher annual
expenses than expenses than expenses than
Class B or C Class A Shares. Class A Shares.
Shares.
</TABLE>
SHAREHOLDER INFORMATION
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<PAGE> 67
DISTRIBUTION ARRANGEMENTS/SALES CHARGES
CONTINUED
THE EQUITY FUNDS
<TABLE>
<S> <C> <C> <C>
CLASS A SHARES CLASS B SHARES CLASS C SHARES
Sales Charge (Load) Percentage of No front-end No front-end
Investment: sales charge. A sales charge. A
contingent contingent
3.50% deferred sales deferred sales
Less than $50,000 charge (CDSC) charge (CDSC)
$50,000 but less than 2.50% may be imposed may be imposed
$100,000 on shares on shares
$100,000 but less 1.50% redeemed within redeemed within
than $250,000 four years after one year after
$250,000 but less 1.00% purchase. Shares purchase.
than $500,000 None automatically
$500,000 and over convert to Class
A Shares after 6
years.
Distribution (12b-1) Subject to Subject to Subject to
and Service Fees combined annual combined annual combined annual
distribution and distribution and distribution and
shareholder shareholder shareholder
servicing fees servicing fees servicing fees
of up to .25% of up to 1.00% of up to 1.00%
annually of the annually of the annually of the
Fund's total Fund's average Fund's average
average daily daily net daily net
net assets. assets. assets.
Fund Expenses Lower annual Higher annual Higher annual
expenses than expenses than expenses than
Class B or C Class A Shares. Class A Shares.
Shares.
</TABLE>
SHAREHOLDER INFORMATION
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<PAGE> 68
DISTRIBUTION ARRANGEMENTS/SALES CHARGES
CONTINUED
DISTRIBUTION (12b-1) AND SHAREHOLDER SERVICE FEES
12b-1 fees compensate the Distributor and other dealers and investment
representatives for services and expenses relating to the sale and
distribution of the Funds' shares and/or for providing shareholder services.
12b-1 fees are paid from Fund assets on an ongoing basis, and will decrease
the return on your investment.
- The 12b-1 fees vary by share class as follows:
- Class A shares may pay a 12b-1 fee of up to .25% of the average daily
net assets of the Class A shares of the Fund.
- Class B and Class C shares pay a 12b-1 fee of up to 0.75% of the
average daily net assets of the respective classes of the Fund. This
will cause expenses for Class B and Class C shares to be higher and
dividends to be lower than for Class A shares.
- The higher 12b-1 fee on Class B and Class C shares, together with the
contingent deferred sales load help the Distributor sell Class B and
Class C shares without an "up-front" sales charge. In particular, these
fees help to defray the Distributor's costs of advancing brokerage
commissions to investment representatives.
- In addition to the 12b-1 fees, Class A, Class B and Class C shares are
subject to a shareholder servicing fee of up to .25% of the average daily
net assets of the respective classes of the Funds.
- The combination of the 12b-1 fees and shareholder servicing fees will not
exceed 1.00% of the average daily net assets of the respective classes of
the Funds for the Class B and Class C shares.
Long-term Class B and Class C shareholders may pay indirectly more than the
equivalent of the maximum permitted front-end sales charge due to the
recurring nature of 12b-1 distribution and service fees.
SHAREHOLDER INFORMATION
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<PAGE> 69
DISTRIBUTION ARRANGEMENTS/SALES CHARGES
CONTINUED
CLASS A SHARES
WAIVER OF SALES CHARGES FOR CLASS A SHARES
The following qualify for waivers of sales charges:
- Shares purchased by investment representatives through fee-based
investment products or accounts.
- Proceeds from redemptions from another mutual fund complex within 60 days
after redemption, if you paid a front-end sales charge for those shares.
- Reinvestment of distributions from a deferred compensation plan, agency,
trust, or custody account that was maintained by the Advisers or their
affiliates or invested in any of the Funds.
- Shares purchased for trust or other advisory accounts established with
the Advisers or their affiliates.
- Shares purchased by directors, trustees, employees, and family members of
the Advisers and their affiliates and any organization that provides
services to the Funds; retired Fund trustees; dealers who have an
agreement with the Distributor; and any trade organization to which the
Advisers or the Administrator belongs.
SALES CHARGE REDUCTIONS
Reduced sales charges for Class A shares are available to shareholders with
investments of $50,000 or more. In addition, you may qualify for reduced
sales charges under the following circumstances.
- Letter of Intent. You inform the Fund in writing that you intend to
purchase enough shares over a 13-month period to qualify for a reduced
sales charge. You must include a minimum of 5% of the total amount you
intend to purchase with your letter of intent.
- Rights of Accumulation. When the value of shares you already own plus
the amount you intend to invest reaches the amount needed to qualify for
reduced sales charges, your added investment will qualify for the reduced
sales charge.
- Combination Privilege. You can combine accounts of multiple Funds
(excluding the Money Market Funds) or accounts of immediate family
household members (spouse and children under 21) to achieve reduced sales
charges.
SHAREHOLDER INFORMATION
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<PAGE> 70
DISTRIBUTION ARRANGEMENTS/SALES CHARGES
CONTINUED
CLASS B SHARES
Class B Shares of the Funds may be purchased for individual accounts only in
amounts of less than $500,000. There is no sales charge imposed upon
purchases of Class B Shares, but investors may be subject to a contingent
deferred sales charge ("CDSC").
THE INCOME FUNDS
Specifically, the Fund's Shares will
be subject to a declining CDSC if
Class B shares of the Income Funds
are redeemed less than three years
after purchase. In such cases, the
CDSC will be as illustrated in the
chart to the right.
<TABLE>
<CAPTION>
YEARS CDSC AS A % OF
SINCE DOLLAR AMOUNT
PURCHASE SUBJECT TO CHARGE
<S> <C>
0-1 3.00%
1-2 2.00%
2-3 1.00%
more than 3 None
</TABLE>
THE EQUITY FUNDS
In addition, the Fund's B Shares will
be subject to a declining CDSC if
Class B shares the Equity Funds are
redeemed within four years after
purchase. In such cases, the CDSC
will be as illustrated in the chart
to the right.
For Income and Equity Funds, the CDSC
will be based upon the lower of the
NAV at the time of purchase or the
NAV at the time of redemption. There
is no CDSC on reinvested dividends or
distributions.
<TABLE>
<CAPTION>
YEARS CDSC AS A % OF
SINCE DOLLAR AMOUNT
PURCHASE SUBJECT TO CHARGE
<S> <C>
0-1 4.00%
1-2 3.00%
2-3 2.00%
3-4 1.00%
more than 4 None
</TABLE>
If you sell some but not all of your Class B shares, shares not subject to
the CDSC (i.e., shares purchased with reinvested dividends) will be redeemed
first, followed by shares subject to the lowest CDSC (typically shares held
for the longest time).
SHAREHOLDER INFORMATION
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<PAGE> 71
DISTRIBUTION ARRANGEMENTS/SALES CHARGES
CONTINUED
CONVERSION FEATURE -- CLASS B SHARES
X Class B Shares of the Funds will convert automatically to Class A Shares
of the same Fund after either five years (Income Funds) or six years
(Equity Funds) from the beginning of the calendar month in which the Class
B shares were originally purchased.
X After conversion, your shares will be subject to the lower distribution
and shareholder servicing fees charged on Class A shares which will
increase your investment return compared to the Class B shares.
X You will not pay any sales charge or fees when your shares convert, nor
will the transaction be subject to any tax.
X If you purchased Class B shares of one Fund which you exchanged for Class
B shares of another Fund, your holding period will be calculated from the
time of your original purchase of Class B shares. The dollar value of
Class A shares you receive will equal the dollar value of the Class B
shares converted.
CLASS C SHARES
Class C Shares of the Funds may be purchased for individual accounts normally
in amounts of less than $500,000. There is no sales charge imposed upon
purchases of Class C Shares, but investors may be subject to a CDSC.
Specifically, if you redeem Class C shares of the Funds, your redemption may
be subject to a 1.00% CDSC if the shares are redeemed less than one year
after the original purchase of the Class C Shares. The CDSC will be assessed
on an amount equal to the lesser of the current market value or the cost of
the shares being redeemed.
Unlike Class B shares, Class C Shares have no conversion feature.
WAIVER OF SALES CHARGES -- CLASS B SHARES AND CLASS C SHARES
The following qualify for waivers of sales charges:
- Distributions following the death or disability of a Shareholder.
- Redemptions representing the minimum distribution from an IRA or a
Custodial Account to a Shareholder who has reached age 70 1/2.
- Redemptions representing the minimum distribution from 401(k) retirement
plans where such redemptions are necessary to make distributions to plan
participants.
SHAREHOLDER INFORMATION
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<PAGE> 72
EXCHANGING YOUR SHARES
You can exchange your shares in one Fund for shares of the same class of
another Republic Fund, usually without paying additional sales charges (see
"Notes on Exchanges" below). No transaction fees are charged for exchanges.
You must meet the minimum investment requirements for the Fund into which you
are exchanging. Exchanges from one Fund to another are taxable.
INSTRUCTIONS FOR EXCHANGING SHARES
Exchanges may be made by sending a written request to Republic Funds, 3435
Stelzer Road, Columbus, Ohio 43219-3035 or by calling 1-888-525-5757. Please
provide the following information:
X Your name and telephone number
X The exact name on your account and account number
X Taxpayer identification number (usually your Social Security number)
X Dollar value or number of shares to be exchanged
X The name of the Fund from which the exchange is to be made
X The name of the Fund into which the exchange is being made.
See "Selling your Shares" for important information about telephone
transactions.
To prevent disruption in the management of the Funds, due to market timing
strategies, excessive exchange activity may be limited.
NOTES ON EXCHANGES
When exchanging from a Fund that has no sales charge or a lower sales charge
to a Fund with a higher sales charge, you will pay the difference.
The registration and tax identification numbers of the two accounts must be
identical.
The Exchange Privilege (including automatic exchanges) may be changed or
eliminated at any time upon a 60-day notice to shareholders.
Be sure to read the Prospectus carefully of any Fund into which you wish to
exchange shares.
SHAREHOLDER INFORMATION
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<PAGE> 73
SHAREHOLDER INFORMATION
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DIVIDENDS, DISTRIBUTIONS AND TAXES
- Any income a Fund receives in the form of interest and dividends is paid
out, less expenses, to its shareholders. Shares begin accruing interest and
dividends on the day they are purchased.
- Dividends on all Income Funds are paid monthly. Capital gains for all Funds
are distributed at least annually. Unless a shareholder elects to receive
dividends in cash, dividends will be automatically invested in additional
shares of the Fund.
- Dividends and distributions are treated in the same manner for federal
income tax purposes whether you receive them in cash or in additional
shares.
- Dividends are taxable as ordinary income. Taxation on capital gains will
vary with the length of time a Fund has held the security -- not how long
the shareholder has been in a Fund.
- Dividends are taxable in the year in which they are paid, even if they
appear on your account statement the following year. If a Fund declares a
dividend in October, November or December of a year and distributes the
dividend in January of the next year, you may be taxed as if you received it
in the year declared rather than the year received.
- There may be tax consequences to you if you dispose of your shares in a
Fund, for example, through redemption, exchange or sale. The amount of any
gain or loss and the rate of tax will depend mainly upon how much you pay
for the shares, how much you sell them for, and how long you held them.
- You will be notified in January each year about the federal tax status of
distributions made by the Funds. The notice will tell you which dividends
and redemptions must be treated as taxable ordinary income and which (if
any) are short-term or long-term capital gain. Depending on your residence
for tax purposes, distributions also may be subject to state and local
taxes, including withholding taxes.
- Foreign shareholders may be subject to special withholding requirements.
- If you invest through a tax-deferred retirement account, such as an IRA, you
generally will not have to pay tax on dividends or capital gains until they
are distributed from the account. These accounts are subject to complex tax
rules, and you should consult your tax adviser about investment through a
tax-deferred account.
- There is a penalty on certain pre-retirement distributions from retirement
accounts.
- Because everyone's tax situation is unique, always consult your tax
professional about federal, state, and local tax consequences.
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<PAGE> 74
FINANCIAL HIGHLIGHTS
LOGO
The financial highlights tables are intended to help you understand the
Fund's financial performance for the past five years, or, if shorter, the
period of the Fund's operations. Certain information reflects financial
results for a single Fund share. The total returns in the table represent the
rate that an investor would have earned or lost on an investment in the Fund
(assuming reinvestment of all dividends and distributions for the indicated
periods). This information has been derived from information audited by KPMG
Peat Marwick LLP, whose report, along with the Fund's financial statements,
are included in the annual report, which is available upon request.
Financial information for Class C Shares of the Funds is not shown because
Class C Shares were not offered prior to November 3, 1998.
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<PAGE> 75
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC BOND FUND
CLASS A (INVESTOR) SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE YEAR ENDED AUGUST 26, 1996
OCTOBER 31, (COMMENCEMENT
------------------ OF OPERATIONS) TO
1998 1997 OCTOBER 31, 1996
<S> <C> <C> <C>
NET ASSET VALUE PER SHARE,
BEGINNING OF PERIOD $ 10.50 $ 10.26 $ 10.00
-------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.59 0.57 0.10
Net gains on securities (realized and
unrealized) 0.01 0.30 0.26
-------------------------------------------------------------------------------
Total income from investment
operations 0.60 0.87 0.36
-------------------------------------------------------------------------------
Less distributions:
Dividends (from net investment
income) (0.59) (0.57) --
Dividends (from net capital gains) -- (0.06) (0.10)
-------------------------------------------------------------------------------
Total distributions (0.59) (0.63) (0.10)
-------------------------------------------------------------------------------
Net change in net asset value per share 0.01 0.24 0.26
-------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE,
END OF PERIOD $ 10.51 $ 10.50 $ 10.26
-------------------------------------------------------------------------------
Total return (c) 5.83% 8.71% 3.61%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $ 4,826 $ 2,439 $ 21
Ratio of expenses to average
net assets 1.10% 1.10% 1.04%(a)
Ratio of net income to average
net assets 5.51% 5.40% 5.23%(a)
Ratio of expenses to average
net assets (excluding fee waivers
and expense reimbursements) 1.61% 5.24% 280.50%(a)
Ratio of net income to average net
assets (excluding fee waivers and
expense reimbursements) 5.00% 1.27% (274.18%)(a)
Portfolio turnover rate of the
Portfolio 126.40% 349.00% N/A*
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) The total return is calculated excluding the sales charge of 2.75% which
applies to purchases of Class A shares.
* Portfolio turnover rate of the Portfolio is not available for this
period.
See notes to financial statements.
74
<PAGE> 76
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC BOND FUND
CLASS B SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
JANUARY 6, 1998
(COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31, 1998
<S> <C>
NET ASSET VALUE PER SHARE, BEGINNING OF PERIOD $10.63
------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.41
Net gains on securities (realized and unrealized) (0.12)
------------------------------------------------------------------------------
Total income from investment operations 0.29
------------------------------------------------------------------------------
Less distributions:
Dividends (from net investment income) (0.41)
Dividends (from capital gains) --
------------------------------------------------------------------------------
Total distributions (0.41)
------------------------------------------------------------------------------
Net change in net asset value per share (0.12)
------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF PERIOD $10.51
------------------------------------------------------------------------------
Total return (c) 2.84%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $ 364
Ratio of expenses to average net assets 1.85%(a)
Ratio of net income to average net assets 4.76%(a)
Ratio of expenses to average net assets (excluding fee
waivers and expense reimbursements) 2.36%(a)
Ratio of net income to average net assets (excluding
fee waivers and expense reimbursements) 4.25%(a)
Portfolio turnover rate of the Portfolio N/A*
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) The total return is calculated excluding the contingent deferred sales
charge which applies to redemptions of Class B Shares.
* Portfolio turnover rate of the Portfolio is not available for this
period.
See notes to financial statements.
75
<PAGE> 77
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC NEW YORK TAX-FREE BOND FUND
CLASS A (INVESTOR) SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
MAY 1, 1995
FOR THE YEAR ENDED OCTOBER 31, (COMMENCEMENT
-------------------------------- OF OFFERING) TO
1998 1997 1996 OCTOBER 31, 1995
<S> <C> <C> <C> <C>
NET ASSET VALUE PER SHARE,
BEGINNING OF PERIOD $ 10.64 $ 10.30 $10.38 $10.00
----------------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.47 0.45 0.54 0.25
Net gains on securities
(realized and unrealized) 0.33 0.36 (0.01) 0.38
----------------------------------------------------------------------------------------
Total income from investment
operations 0.80 0.81 0.53 0.63
----------------------------------------------------------------------------------------
Less distributions:
Dividends (from net investment
income) (0.47) (0.45) (0.54) (0.25)
Distributions (from capital
gains) (0.04) (0.02) (0.07) --
----------------------------------------------------------------------------------------
Total distributions (0.51) (0.47) (0.61) (0.25)
----------------------------------------------------------------------------------------
Net change in net asset value per
share 0.29 0.34 (0.08) 0.38
----------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF
PERIOD $ 10.93 $ 10.64 $10.30 $10.38
----------------------------------------------------------------------------------------
Total return (d) 7.65% 8.22% 4.75% 6.39%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's) $23,153 $20,794 $6,353 $6,908
Ratio of expenses to average net
assets 0.95% 0.92% 0.58% 0.50%(a)
Ratio of net income to average
net assets 4.28% 4.46% 4.78% 4.91%(a)
Ratio of expenses to average net
assets (excluding fee waivers
and expense reimbursements) 1.20% 1.55% 2.21% 2.40%(a)
Ratio of net income to average
net assets (excluding fee
waivers and expense
reimbursements) 4.03% 3.83% 3.15% 3.10%(a)
Portfolio turnover rate (c) 100.35% 163.46% 178.11% 130.00%
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) Portfolio turnover is calculated on the basis of the Fund as a whole,
without distinguishing between the classes of shares issued.
(d) The total return is calculated excluding the sales charge of 2.75% which
applies to purchases of Class A Shares.
See notes to financial statements.
76
<PAGE> 78
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC NEW YORK TAX-FREE BOND FUND
CLASS B SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
JANUARY 6, 1998
(DATE OF INITIAL
OFFERING) TO
OCTOBER 31, 1998
<S> <C>
NET ASSET VALUE PER SHARE, BEGINNING OF PERIOD $10.81
--------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.37
Net gains on securities (realized and unrealized) 0.11
--------------------------------------------------------------------------------
Total income from investment operations 0.48
--------------------------------------------------------------------------------
Less distributions:
Dividends (from net investment income) (0.37)
Distributions (from capital gains) --
--------------------------------------------------------------------------------
Total distributions (0.37)
--------------------------------------------------------------------------------
Net change in net asset value per share 0.11
--------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF PERIOD $10.92
--------------------------------------------------------------------------------
Total return (d) 4.50%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $ 618
Ratio of expenses to average net assets 1.70%(a)
Ratio of net income to average net assets 3.53%(a)
Ratio of expenses to average net assets (excluding fee
waivers and expense reimbursements) 1.95%(a)
Ratio of net income to average net assets (excluding fee
waivers and expense reimbursements) 3.28%(a)
Portfolio turnover rate (c) 100.35%
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) Portfolio turnover is calculated on the basis of the Fund as a whole,
without distinguishing between the classes of shares issued.
(d) The total return is calculated excluding the contingent deferred sales
charge which applies to redemptions of Class B Shares.
See notes to financial statements.
77
<PAGE> 79
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC EQUITY FUND
CLASS A (INVESTOR) SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
AUGUST 1, 1995
FOR THE YEAR ENDED OCTOBER 31, (COMMENCEMENT
-------------------------------- OF OPERATIONS) TO
1998 1997 1996 OCTOBER 31, 1995
<S> <C> <C> <C> <C>
NET ASSET VALUE PER SHARE, BEGINNING
OF PERIOD $ 15.00 $ 11.93 $10.24 $ 10.00
-------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.05 0.07 0.19 0.04
Net gains on securities (realized
and unrealized) 2.80 3.32 1.67 0.24
-------------------------------------------------------------------------------------------
Total income from investment
operations 2.85 3.39 1.86 0.28
-------------------------------------------------------------------------------------------
Less distributions:
Dividends (from net investment
income) (0.05) (0.10) (0.17) (0.04)
Distributions (from capital gains) (0.85) (0.22) -- --
-------------------------------------------------------------------------------------------
Total distributions (0.90) (0.32) (0.17) (0.04)
-------------------------------------------------------------------------------------------
Net change in net asset value per
share 1.95 3.07 1.69 0.24
-------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF
PERIOD $ 16.95 $ 15.00 $11.93 $ 10.24
-------------------------------------------------------------------------------------------
Total return (d) 19.98% 28.92% 18.30% 2.75%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) $23,559 $12,363 $3,918 $22,092
Ratio of expenses to average net
assets 1.03% 1.21% 1.28% 1.47%(a)
Ratio of net income to average net
assets 0.30% 0.48% 1.83% 1.59%(a)
Ratio of expenses to average net
assets (excluding fee waivers and
expense reimbursements) 1.03% 1.28% 1.59% 2.44%(a)
Ratio of net income to average net
assets (excluding fee waivers and
expense reimbursements) 0.30% 0.41% 1.51% 0.62%(a)
Portfolio turnover rate (c) 176.34% 99.02% 86.18% 2.00%(a)
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) Portfolio turnover is calculated on the basis of the Fund as a whole,
without distinguishing between the classes of shares issued.
(d) The total return is calculated excluding the sales charge of 3.50% which
applies to purchases of Class A Shares.
See notes to financial statements.
78
<PAGE> 80
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC EQUITY FUND
CLASS B SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
JANUARY 6, 1998
(DATE OF INITIAL
OFFERING) TO
OCTOBER 31, 1998
<S> <C>
NET ASSET VALUE PER SHARE, BEGINNING OF PERIOD $14.88
--------------------------------------------------------------------------------
Income from investment operations:
Net investment loss (0.01)
Net gains on securities (realized and unrealized) 2.07
--------------------------------------------------------------------------------
Total income from investment operations 2.06
--------------------------------------------------------------------------------
Less distributions:
Dividends (from net investment income) (0.02)
Distributions (from capital gains) --
--------------------------------------------------------------------------------
Total dividends and distributions (0.02)
--------------------------------------------------------------------------------
Net change in net asset value per share 2.04
--------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF PERIOD $16.92
--------------------------------------------------------------------------------
Total return (d) 13.84%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) $ 956
Ratio of expenses to average net assets 1.78%(a)
Ratio of net income to average net assets (0.45%)(a)
Ratio of expenses to average net assets (excluding fee
waivers and expense reimbursements) 1.78%(a)
Ratio of net income to average net assets (excluding fee
waivers and expense reimbursements) (0.45%)(a)
Portfolio turnover rate (c) 176.34%
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) Portfolio turnover is calculated on the basis of the Fund as a whole,
without distinguishing between the classes of shares issued.
(d) The total return is calculated excluding the contingent deferred sales
charge which applies to redemptions of Class B Shares.
See notes to financial statements.
79
<PAGE> 81
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC OVERSEAS EQUITY FUND
CLASS A (INVESTOR) SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE YEAR ENDED AUGUST 26, 1996
OCTOBER 31, (COMMENCEMENT
------------------- OF OPERATIONS) TO
1998 1997 OCTOBER 31, 1996
<S> <C> <C> <C>
NET ASSET VALUE PER SHARE, BEGINNING OF
PERIOD $11.57 $10.15 $ 10.00
-----------------------------------------------------------------------------------
Income from investment operations:
Net investment income/(loss) (0.01) (0.00)* --
Net gains on securities (realized and
unrealized) 0.23 1.43 0.15
-----------------------------------------------------------------------------------
Total income from investment
operations 0.22 1.43 0.15
-----------------------------------------------------------------------------------
Less distributions:
Dividends (from net investment income) (0.08) (0.01) --
Distributions (from capital gains) (0.07) 0.00* --
-----------------------------------------------------------------------------------
Total distributions (0.15) (0.01) --
-----------------------------------------------------------------------------------
Net change in net asset value per share 0.07 1.42 0.15
-----------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF PERIOD $11.64 $11.57 $ 10.15
-----------------------------------------------------------------------------------
Total return (c) 1.96% 14.08% 1.50%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $6,070 $3,660 $ 142
Ratio of expenses to average net assets 1.77% 1.71% 1.69%(a)
Ratio of net income to average net
assets (0.08%) (0.16%) 0.05%(a)
Ratio of expenses to average net assets
(excluding fee waivers and expense
reimbursements) 1.86% 4.10% 33.34%(a)
Ratio of net income to average net
assets (excluding fee waivers and
expense reimbursements) (0.17%) (2.55%) (31.65%)(a)
Portfolio turnover rate of the Portfolio 40.47% 30.00% N/A**
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) The total return is calculated excluding the sales charge of 3.50% which
applies to purchases of Class A shares.
* Less than $0.01 per share.
** Portfolio turnover rate of the Portfolio is not available for this
period.
See notes to financial statements.
80
<PAGE> 82
Financial Highlights
LOGO
REPUBLIC OVERSEAS EQUITY FUND
CLASS B SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
JANUARY 6, 1998
(COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31, 1998
<S> <C>
NET ASSET VALUE PER SHARE, BEGINNING OF PERIOD $11.45
-------------------------------------------------------------------------------
Income from investment operations:
Net investment income (0.07)
Net gains on securities (realized and unrealized) 0.19
-------------------------------------------------------------------------------
Total income from investment operations 0.12
-------------------------------------------------------------------------------
Less and distributions:
Dividends (from net investment income) --
Distributions (from capital gains) --
-------------------------------------------------------------------------------
Total distributions --
-------------------------------------------------------------------------------
Net change in net asset value per share 0.12
-------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF PERIOD $11.57
-------------------------------------------------------------------------------
Total return (c) 1.05%(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $ 42
Ratio of expenses to average net assets 2.52%(a)
Ratio of net income to average net assets (0.83%)(a)
Ratio of expenses to average net assets (excluding fee
waivers and expense reimbursements) 2.61%(a)
Ratio of net income to average net assets (excluding fee
waivers and expense reimbursements) (0.92%)(a)
Portfolio turnover rate of the Portfolio N/A**
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) The total return is calculated excluding the contingent deferred sales
charge which applies to redemptions of Class B Shares.
* Less than $0.01 per share.
** Portfolio turnover rate of the Portfolio is not available for this period.
See notes to financial statements.
81
<PAGE> 83
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC OPPORTUNITY FUND
CLASS A (INVESTOR) SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE YEAR ENDED SEPTEMBER 23, 1996
OCTOBER 31, (COMMENCEMENT
------------------ OF OFFERING) TO
1998 1997 OCTOBER 31, 1996
<S> <C> <C> <C>
NET ASSET VALUE PER SHARE, BEGINNING OF
PERIOD $ 12.37 $ 9.80 $10.00
---------------------------------------------------------------------------------
Income from investment operations:
Net investment loss (0.13) (0.07) --
Net gains or losses on securities
(realized and unrealized) (0.46) 2.64 (0.20)
---------------------------------------------------------------------------------
Total income (loss) from
investment operations (0.59) 2.57 (0.20)
---------------------------------------------------------------------------------
Less distributions:
Distributions (from capital gains) (0.45) 0.00* --
---------------------------------------------------------------------------------
Total distributions (0.45) 0.00* --
---------------------------------------------------------------------------------
Net change in net asset value per
share (1.04) 2.57 --
---------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF
PERIOD $ 11.33 $ 12.37 $ 9.80
---------------------------------------------------------------------------------
Total return (c) (4.68%) 26.28% (2.00%)(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $13,137 $9,983 $3,184
Ratio of expenses to average net
assets 1.63% 1.55% 1.22%(a)
Ratio of net loss to average net
assets (1.17%) (1.05%) (0.28%)(a)
Ratio of expenses to average net
assets (excluding fee waivers and
expense reimbursements) 1.64% 2.01% 2.90%(a)
Ratio of net loss to average net
assets (excluding fee waivers and
expense reimbursements) (1.18%) (1.51%) (2.06%)(a)
Portfolio turnover rate of the
Portfolio 154.69% 92.18% N/A**
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) The total return is calculated excluding the sales charge of 3.50% which
applies to purchases of Class A shares.
* Less than $0.01 per share.
** Portfolio turnover rate of the Portfolio is not available for this
period.
See notes to financial statements.
82
<PAGE> 84
FINANCIAL HIGHLIGHTS
LOGO
REPUBLIC OPPORTUNITY FUND
CLASS B SHARES
<TABLE>
<CAPTION>
FOR THE PERIOD
JANUARY 6, 1998
(COMMENCEMENT
OF OFFERING) TO
OCTOBER 31, 1998
<S> <C>
NET ASSET VALUE PER SHARE, BEGINNING OF PERIOD $11.65
--------------------------------------------------------------------------------
Income from investment operations:
Net investment loss (0.09)
Net gains or losses on securities (realized and
unrealized) (0.25)
--------------------------------------------------------------------------------
Total from investment operations (0.34)
--------------------------------------------------------------------------------
Less distributions:
Distributions (from capital gains) --
--------------------------------------------------------------------------------
Total distributions --
--------------------------------------------------------------------------------
Net change in net asset value per share (0.34)
--------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE, END OF PERIOD $11.31
--------------------------------------------------------------------------------
Total return (c) (2.92%)(b)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $ 349
Ratio of expenses to average net assets 2.38%(a)
Ratio of net loss to average net assets (1.92%)(a)
Ratio of expenses to average net assets (excluding fee
waivers and expense reimbursements) 2.39%(a)
Ratio of net loss to average net assets (excluding fee
waivers and expense reimbursements) (1.93%)(a)
Portfolio turnover rate of the Portfolio N/A*
</TABLE>
(a) Annualized.
(b) Not annualized.
(c) The total return is calculated excluding the contingent deferred sales
charge which applies to redemptions of Class B Shares.
* Portfolio turnover rate of the Portfolio is not available for this
period.
See notes to financial statements.
83
<PAGE> 85
PRIOR PERFORMANCE OF SUB-ADVISERS
LOGO
The following tables set forth information for the Bond Fund, Equity Fund,
Overseas Equity Fund and the Opportunity Fund, and information on the prior
performance of the Sub-Advisers for those Funds and, where applicable, the
corresponding portfolios.
The Sub-Adviser prior performance information is a composite of the average
annual total returns of all institutional separate accounts managed by the
Sub-Advisers that have investment objectives, policies and restrictions
substantially similar to the Funds (and corresponding Portfolios), and which
have been managed as the Funds (and corresponding Portfolios) have been
managed. The composite data is provided to illustrate the past performance of
the Sub-Advisers in managing substantially similar accounts with
substantially similar investment objectives, strategies and policies as
measured against the specified market index and does not represent the
performance of the Bond Fund, Equity Fund, Overseas Equity Fund or
Opportunity Fund or the Fixed Income Portfolio, International Equity
Portfolio or Small Cap Equity Portfolio.
<TABLE>
<CAPTION>
FIXED INCOME SUB-ADVISER
ANNUALIZED RETURNS
BOND FUND SUB-ADVISER SALOMON BIG
PERFORMANCE COMPOSITE+ INDEX(2)
<S> <C> <C> <C>
1 Year(1) 6.40% 5.51% 8.72%
Since Portfolio Inception (1/9/95) 9.20% 8.60%* 10.05%
5 Years(1) N/A 5.57% 7.31%
10 Years(1) N/A 7.93% 9.31%
</TABLE>
- ---------------
(1) Through December 31, 1998.
(2) The Salomon Broad Investment Grade Bond Index is a
market-capitalization-based total return index containing U.S. fixed rate
issues having a maturity of greater than one year and at least $25
million outstanding. The Salomon BIG Index includes Treasury,
Government-sponsored, mortgage-backed, and investment grade corporate
issues.
+ If the expense ratio of the Fund after expense reimbursements was used as
the basis for adjustment, the Sub-Adviser composite average annual returns
would be 6.47% for one year, 6.53% for 5 years, 8.91% for 10 years, and
9.59% since inception.
* Since December 31, 1994.
84
<PAGE> 86
PRIOR PERFORMANCE OF SUB-ADVISERS
LOGO
<TABLE>
<CAPTION>
EQUITY SUB-ADVISERS
EQUITY FUND ALLIANCE RUSSELL BRINSON RUSSELL RUSSELL
PERFORMANCE COMPOSITE GROWTH(2) COMPOSITE VALUE(3) 1000(4)
<S> <C> <C> <C> <C> <C> <C>
1 Year(1) 29.19% 41.91% 38.72% 17.55% 15.64% 27.03%
Since Inception+ 24.67% 31.57% 29.83% 24.17% 24.78% 27.41%
5 Years(1) N/A 25.33% 25.71% 21.09% 20.85% 23.36%
Since 12/31/87 N/A 20.57% 20.57% 18.06% 17.39% 19.03%
</TABLE>
------------------
(1) Through December 31, 1998.
(2) The Russell 1000 Growth Index is an unmanaged index of those companies in
the Russell 1000 Index with higher price-to-book ratios and higher
forecasted growth values.
(3) The Russell 1000 Value Index is an unmanaged index of those companies in
the Russell 1000 Index with lower price-to-book ratios and lower
forecasted growth values.
(4) The Russell 1000 Index is an unmanaged index of the 1000 largest U.S.
companies (representing approximately 90% of the total market
capitalization) in the Russell 3000 Index, which represents approximately
98% of the U.S. equity market by capitalization.
+ Since Fund inception (8/1/95).
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY SUB-ADVISER
ANNUALIZED RETURNS
OVERSEAS EQUITY FUND SUB-ADVISER EAFE
PERFORMANCE COMPOSITE+ INDEX(2)
<S> <C> <C> <C>
1 Year(1) 10.57% 15.58% 20.29%
Since Portfolio Inception
(1/9/95) 10.50% 12.13%* 10.97%
5 Years(1) N/A 9.99% 9.50%
10 Years(1) N/A 9.24% 5.85%
</TABLE>
------------------
(1) Through December 31, 1998.
(2) The EAFE Index includes 1,112 companies in twenty countries representing
the stock markets of Europe, Australia, New Zealand and the Far East. The
combined market capitalization of these companies represents
approximately 60% of the combined market value of the stock exchanges.
The EAFE Index is capitalization weighted in U.S. dollars and includes
dividends.
+ If the expense ratio of the Fund after expense reimbursements was used as
the basis for adjustment, the Sub-Adviser composite average annual returns
would be 15.87% for one year, 10.26% for 5 years, 9.51% for 10 years, and
12.41% since inception.
* Since December 31, 1994.
85
<PAGE> 87
<TABLE>
<CAPTION>
SMALL CAP EQUITY SUB-ADVISER
ANNUALIZED RETURNS
OPPORTUNITY FUND SUB-ADVISER RUSSELL 2000
PERFORMANCE COMPOSITE INDEX(2)
<S> <C> <C> <C>
1 Year(1) 12.96% 13.43% -2.55%
Portfolio Inception 18.06% 18.57%* 12.14%
3 Years(1) N/A 17.84% 11.58%
5 Years(1) N/A 21.43% 11.86%
</TABLE>
------------------
(1) Through December 31, 1998.
(2) The Russell 2000 Small Stock Index is an unmanaged index of the 2000
smallest companies (representing approximately 10% of the total market
capitalization) in the Russell 3000 Index, which represents approximately
98% of the U.S. equity market by capitalization.
+ If the expense ratio of the Fund after expense reimbursements was used as
the basis for adjustment, the Sub-Adviser composite average annual returns
would be 14.51% for one year, 18.95% for three years, 22.57% for five
years, and 19.68% since inception.
* Since August 31, 1996.
PRIOR PERFORMANCE OF SUB-ADVISERS
LOGO
LOGO
86
<PAGE> 88
PRIOR PERFORMANCE OF SUB-ADVISERS
LOGO
TAXABLE EQUIVALENT YIELD TABLES
The tables below show the approximate taxable yields which are equivalent to
tax-exempt yields, for the ranges indicated, under (i) federal and New York
State personal income tax laws, and (ii) federal, New York State and New York
City personal income tax laws, in each case based upon the applicable 1999
rates. Such yields may differ under the laws applicable to subsequent years
if the effect of any such law is to change any tax bracket or the amount of
taxable income which is applicable to a tax bracket. Separate calculations,
showing the applicable taxable income brackets, are provided for investors
who file single returns and for those investors who file joint returns. For
cases in which two or more state (or city) brackets fall within a federal
bracket, the highest state (or city) bracket is combined with the federal
bracket. The combined income tax brackets shown reflect the fact that state
and city income taxes are currently deductible as an itemized deduction for
federal tax purposes (however, a taxpayer's itemized deductions may be
subject to an overall limitation, the effect of which has not been taken into
account in preparing these tables).
FEDERAL AND NEW YORK STATE TABLE
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
TAXABLE INCOME* TAX-EXEMPT YIELD
------------------------------------- INCOME -------------------------------------------------------------
SINGLE JOINT TAX 3.00% 3.50% 4.00% 4.50% 5.00% 5.50% 6.00% 6.50%
RETURN RETURN BRACKET** EQUIVALENT TAXABLE YIELD
----------------- ----------------- --------- -------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0-$20,000 $ 0-$36,900 20.00% 3.75% 4.38% 5.00% 5.63% 6.25% 6.88% 7.50% 8.13%
$ 20,001-$76,400 $ 36,901-$89,150 32.90% 4.47% 5.22% 5.96% 6.71% 7.45% 8.20% 8.94% 9.69%
$ 76,401-$127,500 $ 89,151-$140,000 35.70% 4.67% 5.44% 6.22% 7.00% 7.78% 8.55% 9.33% 10.11%
$127,501-$250,000 $140,001-$250,000 40.40% 5.03% 5.87% 6.71% 7.55% 8.39% 9.23% 10.07% 10.91%
> $250,000 >$250,000 43.70% 5.33% 6.22% 7.10% 7.99% 8.88% 9.77% 10.66% 11.55%
</TABLE>
------------------
* Net amount subject to federal and New York State personal income tax after
deductions and exemptions.
** Effective combined federal and state tax bracket.
This table does not take into account: (i) any taxes other than the regular
federal income tax and the regular New York State personal income tax; or
(ii) the New York State tax table benefit recapture tax. Also, it is assumed
that: (i) there are no federal or New York State minimum taxes applicable;
(ii) a shareholder has no net capital gain; and (iii) a shareholder's taxable
income for federal income tax purposes is the same as his or her taxable
income for New York State income tax purposes. Also, this table does not
reflect the fact that, due to factors including the federal phase-out of
personal exemptions and reduction of certain itemized deductions for
taxpayers whose adjusted gross income exceed specified thresholds, a
shareholder's effective marginal tax rate may differ from his or her tax
bracket rate.
87
<PAGE> 89
PRIOR PERFORMANCE OF SUB-ADVISERS
LOGO
FEDERAL, NEW YORK STATE AND NEW YORK CITY TABLE
<TABLE>
<CAPTION>
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TAXABLE INCOME* TAX-EXEMPT YIELD
------------------------------------- INCOME -------------------------------------------------------------
SINGLE JOINT TAX 3.00% 3.50% 4.00% 4.50% 5.00% 5.50% 6.00% 6.50%
RETURN RETURN BRACKET** EQUIVALENT TAXABLE YIELD
----------------- ----------------- --------- -------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0-$20,000 $ 0-$36,900 22.08% 3.89% 4.53% 5.18% 5.83% 6.48% 7.12% 7.77% 8.42%
$ 20,001-$76,400 $ 36,901-$89,150 35.30% 4.64% 5.41% 6.18% 6.96% 7.73% 8.50% 9.27% 10.05%
$ 76,401-$127,500 $ 89,151-$140,000 38.00% 4.84% 5.65% 6.45% 7.26% 8.06% 8.87% 9.68% 10.48%
$127,501-$250,000 $140,001-$250,000 42.50% 5.22% 6.09% 6.96% 7.83% 8.70% 9.56% 10.43% 11.30%
> $250,000 >$250,000 45.80% 5.54% 6.46% 7.38% 8.30% 9.23% 10.15% 11.07% 11.99%
</TABLE>
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* Net amount subject to federal, New York State and New York City personal
income tax after deductions and exemptions.
** Effective combined federal, state and city tax bracket.
This table does not take into account: (i) any taxes other than the regular
federal income tax, the regular New York State personal income tax, and the
regular New York City personal income tax (including the temporary tax
surcharge and the additional tax); or (ii) the New York State tax table
benefit recapture tax. Also, it is assumed that: (i) there are no federal,
state or city minimum taxes applicable; (ii) a shareholder has no net capital
gain; and (iii) a shareholder's taxable income for federal income tax
purposes is the same as his or her income for state and city tax purposes.
Also, this table does not reflect the fact that, due to factors including the
federal phase-out of personal exemptions and reduction of certain itemized
deductions for taxpayers whose adjusted gross income exceed specified
thresholds, a shareholder's effective marginal tax rate may differ from his
or her tax bracket rate.
While it is expected that most of the dividends paid to the shareholders of
the New York Tax-Free Bond Fund will be exempt from federal, New York State
and New York City personal income taxes, portions of such dividends from time
to time may be subject to such taxes.
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For more information about the Funds, the following documents are available free
upon request:
ANNUAL/SEMIANNUAL REPORTS:
The Funds' annual and semi-annual reports to shareholders contain additional
information on the Funds' investments. In the annual report, you will find a
discussion of the market conditions and investment strategies that significantly
affected the Funds' performance during its last fiscal year.
STATEMENTS OF ADDITIONAL INFORMATION (SAIS):
The SAIs provide more detailed information about the Funds, including their
operations and investment policies. They are incorporated by reference and
legally considered a part of this prospectus.
YOU CAN GET FREE COPIES OF REPORTS AND THE SAIS, PROSPECTUSES OF OTHER MEMBERS
OF THE REPUBLIC FAMILY OF FUNDS, OR REQUEST OTHER INFORMATION AND DISCUSS YOUR
QUESTIONS ABOUT THE FUNDS, BY CONTACTING A BROKER OR BANK THAT SELLS THE FUNDS.
OR CONTACT THE FUNDS AT:
REPUBLIC FUNDS
3435 STELZER ROAD
COLUMBUS, OHIO 43219-3035
TELEPHONE: 1-800-525-5757
You can review the Funds' reports and SAIs at the Public Reference Room of the
Securities and Exchange Commission. You can get text-only copies:
- - For a fee, by writing the Public Reference Section of the Commission,
Washington, D.C. 20549-6009 or calling 1-800-SEC-0330.
- - Free from the Commission's Website at http://www.sec.gov.
Investment Company Act file no. 811-4782.
RFFRC (3/99)
