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COMMON SENSE TRUST
SUPPLEMENT DATED OCTOBER 27, 1997, TO THE PROSPECTUS DATED MARCH 10, 1997,
AS SUPPLEMENTED ON JULY 28, 1997
At an upcoming shareholders' meeting, shareholders of each Common Sense
Trust Fund will be asked to approve a new investment advisory agreement
effective upon the consummation of transactions detailed in an agreement (the
"Agreement") between Van Kampen American Capital Asset Management, Inc. ("VKAC
Asset Management") and certain of its affiliates and Smith Barney Mutual Funds
Management Inc. ("SBMFM") and certain of its affiliates.
The Board of Trustees has recommended that the current investment advisory
agreements with VKAC Asset Management be terminated and that each Fund enter
into a new investment advisory agreement with SBMFM. SBMFM currently provides
sub-advisory services to VKACAM with respect to the International Equity Fund.
The new advisory agreements are substantially the same as the current advisory
agreements except for the dates of execution, effectiveness and termination. In
addition, a provision to recapture tender offer solicitation fees and exchange
offer fees has been removed. The advisory fee, investment objectives and
policies of each Fund as set forth in the Prospectus will remain the same under
the new investment advisory agreements.
VKAC Asset Management, a subsidiary of Morgan Stanley, Dean Witter, Discover
& Co., has served as investment adviser to the Common Sense Trust since the
Trust's inception in 1987.
SBMFM is a wholly-owned subsidiary of Smith Barney Holdings Inc., which in
turn is a wholly-owned subsidiary of Travelers Group Inc. ("Travelers").
Travelers is a diversified financial services holding company engaged primarily
in four business segments: investment services, consumer finance services, life
insurance services and property and casualty insurance services. SBMFM was
formed in 1968 and serves as investment manager to numerous other investment
companies. As of September 30, 1997, SBMFM had aggregate assets under management
in excess of $84 billion.
Common Sense Trust is marketed exclusively by PFS Distributors, Inc., also a
subsidiary of Travelers. Travelers will combine the efforts of its two companies
in the administration and distribution of the Common Sense fund family. Further
details of the proposed transaction will be contained in a proxy statement
expected to be mailed to shareholders in the near future.
The Trustees have also approved an Agreement and Plan of Reorganization
between the Common Sense Money Market Fund ("Money Market Fund") and the Cash
Portfolio of Smith Barney Money Funds, Inc., also advised by SBMFM, providing
for the acquisition by the Cash Portfolio of the assets and substantially all
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of the liabilities of the Money Market Fund and that Class 1, Class A and Class
B shareholders of the Money Market Fund receive Class A shares of the Cash
Portfolio at its net asset value per share (the "Reorganization").
The Reorganization is subject to approval by the holders of a majority of
the outstanding shares of the Money Market Fund. Further details of the proposed
Reorganization will be contained in a proxy statement/prospectus expected to be
mailed to shareholders shortly.
In addition, effective with the new advisory agreements, the name of the
Trust will be changed to Concert Investment Series. Certain changes to the
administration of the Common Sense Trust will also be effective on that same
date. PNC Bank will replace State Street Bank and Trust Company as custodian for
each Common Sense Trust Fund other than Common Sense International Equity Fund.
The Chase Manhattan Bank will serve as custodian for Common Sense International
Equity Fund. First Data Investor Services Group, Inc. will become transfer agent
for the Common Sense Trust Funds with PFS Shareholder Services, Inc., the
current transfer agent, serving as sub-transfer agent.
Several changes are also contemplated to the exchangeability features and
sales charge structure of the Funds. It is currently anticipated that effective
with the new advisory agreements, shareholders of the Funds will be able to
exchange their Fund shares for shares of any Smith Barney mutual funds
distributed by PFS Investments Inc. However, those Smith Barney mutual funds may
have different contingent deferred sales charge ("CDSC") schedules and
conversion time tables than are currently applicable to the Funds. Any Fund
shares exchanged for Smith Barney mutual funds will be subject to the sales
charge schedule and conversion time table applicable to the Smith Barney mutual
fund exchanged into.
It is also anticipated that effective with the new advisory agreements, the
sales charge schedule applicable to Class A shares of the Funds will be modified
by reducing the initial sales charge. At that time, the CDSC schedule for Class
B shares will also be modified, generally by reducing the CDSC charged in the
later years, except that the CDSC charged in the first year for certain
fixed-income funds will increase. All such pricing changes will only be
applicable to purchases made after the effective date of the pricing changes.
