[CHASE VISTA LOGO]
PROSPECTUS
LATIN AMERICAN EQUITY FUND
CLASS A AND B SHARES
INVESTMENT STRATEGY: CAPITAL GROWTH
February 27, 1998, As revised March 13, 1998
This Prospectus explains concisely what you should know before investing.
Please read it carefully and keep it for future reference. You can find more
detailed information about the Fund in its February 27, 1998 Statement of
Additional Information, as amended periodically (the "SAI"). For a free copy of
the SAI, call the Chase Vista Service Center at 1-800-34-VISTA. The SAI has
been filed with the Securities and Exchange Commission (the "Commission") and
is incorporated into this Prospectus by reference. In addition, the Commission
maintains a Web site (http://www.sec.gov) that contains the SAI, the Fund's
Annual Report to Shareholders and other information regarding the Fund which
has been electronically filed with the Commission.
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.
Investments in the Fund are not bank deposits or obligations of, or guaranteed
or endorsed by, The Chase Manhattan Bank or any of its affiliates and are not
insured by the FDIC, the Federal Reserve Board or any other government agency.
Investments in mutual funds involve risk, including the possible loss of the
principal amount invested.
<PAGE>
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
Expense Summary ............................................................... 4
The expenses you might pay on your Fund investment, including examples
Fund Objective ................................................................ 6
Investment Approach ........................................................... 6
The kinds of securities in which the Latin America Fund invests
Other Investment Practices .................................................... 8
The investment techniques and risks of the Fund
Management .................................................................... 14
Chase Manhattan Bank, the Fund's adviser; Chase Asset Management, the Fund's
sub-adviser, and the individuals who manage the Fund
About Your Investment ......................................................... 15
Choosing a share class
How to Buy, Sell and Exchange Shares .......................................... 16
How the Fund Values Its Shares ................................................ 23
How Distributions Are Made; Tax Information ................................... 23
How the Fund distributes its earnings, and the taxes related to those earnings
Other Information Concerning the Fund ......................................... 24
Distribution plans, shareholder servicing agents, administration, custodian,
expenses and organization
Performance Information ....................................................... 28
How performance is determined, stated and/or advertised
Make the Most of Your Chase Vista Privileges .................................. 30
</TABLE>
3
<PAGE>
EXPENSE SUMMARY
Expenses are one of several factors to consider when investing. The following
table summarizes your costs from investing in the Fund based on estimated
expenses for the current fiscal year. The examples show the cumulative expenses
attributable to a hypothetical $1,000 investment over specified periods.
<TABLE>
<CAPTION>
Class A Class B
Shares Shares
------ ------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as a percentage of
offering price) .............................................. 4.75% None
Maximum Deferred Sales Charge (as a percentage of the lower of
original purchase price or redemption proceeds)* ............. None 5.00%
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Investment Advisory Fee (after waivers)** ...................... 0.00% 0.00%
12b-1 Fee*** ................................................... 0.25% 0.75%
Shareholder Servicing Fee ...................................... 0.00%** 0.25%
Other Expenses (after waivers and reimbursements)** ............ 1.50% 1.50%
------- ----
Total Fund Operating Expenses
(after waivers of fees and expense reimbursements)** ......... 1.75% 2.50%
======= ====
</TABLE>
EXAMPLES
Your investment of $1,000 would incur the
following expenses, assuming 5% annual return: 1 Year 3 Years
-------- --------
Class A Shares+ .............................. $64 $100
Class B Shares:
Assuming complete redemption at the end of
the period++ .............................. $77 $110
Assuming no redemptions ..................... $25 $ 78
* The maximum deferred sales charge on Class B shares applies to redemptions
during the first year after purchase; the charge generally declines by 1%
annually thereafter (except in the fourth year), reaching zero after six
years. See "How to Buy, Sell and Exchange Shares."
** Reflects current fee waiver and expense reimbursement arrangements to
maintain Total Fund Operating Expenses at the levels indicated in the table
above. Absent such arrangements, the Investment Advisory Fee and Other
Expenses would be 1.00%, and 1.65% respectively, for Class A and Class B
shares, the Shareholder Servicing Fee for Class A shares would be 0.25% and
Total Fund Operating Expenses would be 3.15% and 3.65% for Class A and Class
B shares, respectively.
*** Long-term shareholders in mutual funds with 12b-1 fees, such as Class A and
Class B shareholders of the Fund, may pay more than the economic equivalent
of the maximum front-end sales charge permitted by rules of the National
Association of Securities Dealers, Inc.
+ Assumes deduction at the time of purchase of the maximum sales charge.
++ Assumes deduction at the time of redemption of the maximum applicable
deferred sales charge.
4
<PAGE>
The table is provided to help you understand the expenses of investing in the
Fund and your share of the operating expenses that the Fund incurs. The
examples should not be considered representations of past or future expenses or
returns; actual expenses and returns may be greater or less than shown.
Charges or credits, not reflected in the expense table above, may be incurred
directly by customers of financial institutions in connection with investments
in the Fund. The Fund understands that Shareholder Servicing Agents may credit
to the accounts of their customers from whom they are already receiving other
fees amounts not exceeding such other fees or the fees received by the
Shareholder Servicing Agent from the Fund with respect to those accounts. See
"Other Information Concerning the Fund."
5
<PAGE>
FUND OBJECTIVE
The Fund seeks total return from long-term capital growth. The Fund is not
intended to be a complete investment program, and there is no assurance that
the Fund will achieve its objective.
INVESTMENT APPROACH
The Fund will invest principally in a broad portfolio of equity securities of
foreign companies located in countries throughout Latin America. Under normal
market conditions, the Fund will invest at least 65% of its total assets in
equity securities of Latin American issuers.
The Fund's advisers seek to identify those countries and industries throughout
Latin America where economic and political factors are likely to produce
above-average growth rates. The Fund's advisers attempt to identify those
companies in such countries and industries that are best positioned and managed
to take advantage of these economic and political factors. Emphasis will be
placed on companies in Argentina, Brazil, Chile, Colombia, Mexico, Peru and
Venezuela, but the Fund may also invest in companies in other countries in
Latin America, which, for purposes of this prospectus, includes Mexico, and the
Spanish- and Portuguese-speaking countries of Central America, South America
and the islands of the Caribbean. The Fund may invest heavily in countries
which comprise a substantial portion of the total Latin American market
capitalization.
The Fund is classified as a "non-diversified" fund under federal securities
law.
WHO MAY WANT TO INVEST
Latin American Equity Fund may
be most appropriate for investors
who . . .
[bullet] Are seeking long-term growth of capital
[bullet] Are investing for goals several years away
[bullet] Own or plan to own other types of investments for diversification
purposes
[bullet] Can assume market risk and the risk of investing internationally
The Fund may NOT be appropriate for investors who are unable to tolerate
frequent up and down price changes and the potential instability of foreign
markets; who are investing for short-term goals or who are in need of current
income.
INVESTMENT POLICIES
Instead of investing directly in underlying securities, the Fund is authorized
to seek to achieve its objective by investing all of its investable assets in
another investment company having substantially the same investment objective
and policies as the Fund.
The equity securities in which the Fund may invest include common stocks,
preferred stocks, securities convertible into common stocks and warrants to
purchase common stocks. Investments will be selected based on their potential
for capital growth.
For purposes of the investment policies described above, a security is deemed
to be issued by an issuer of Latin America if (i) the principal trading market
for the security is in Latin America, (ii) the issuer is organized under the
laws of a jurisdiction of Latin America or (iii)
6
<PAGE>
the issuer derives at least 50 percent of its revenues or profits from Latin
America or has at least 50 percent of its assets situated in Latin America.
The Fund's advisers will allocate the Fund's investments among securities
denominated in the U.S. dollar, other major reserve currencies and currencies
of Latin American countries in which the Fund is permitted to invest. The
advisers may adjust the Fund's exposure to each such currency based on their
perception of the most favorable markets and issuers. The percentage of the
Fund's assets invested in securities of a particular country or denominated in
a particular currency will vary in accordance with the advisers' assessment of
the relative yield and appreciation potential of such securities and the
current and anticipated relationship of a country's currency to the U.S.
dollar. Fundamental economic strength, earnings growth, quality of management,
industry growth, credit quality and interest rate trends are some of the
principal factors which may be considered by the Fund's advisers in determining
the degree of emphasis placed upon a particular type of security, industry
sector, country or currency within the Fund's portfolio. Securities purchased
by the Fund may be denominated in a currency other than that of the country in
which the issuer is domiciled. The Fund is not limited as to the amount of its
assets that may be invested in any one country; however, it will attempt to
allocate investments among a wide range of industries and companies. The Fund
will place primary emphasis on equity and equity-related securities but may
also invest in any type of debt security and various derivative securities if
the advisers believe that doing so may result in capital growth. The Fund will
not invest more than 25% of its net assets in debt securities denominated in a
single currency other than the U.S. dollar, or invest more than 25% of its net
assets in debt securities issued by a single foreign government or
supranational organization. Because certain companies represent a significant
portion of the total market capitalization of the country or countries in which
they operate, the Fund may invest a significant proportion of its assets in
these companies.
The Fund's advisers will review economic and political events in the countries
in which the Fund is invested on an ongoing basis.
The Fund may invest in securities of companies of various sizes, including
smaller companies whose securities may be more volatile and less liquid than
securities of larger companies. With respect to certain countries in which
capital markets are either less developed or not easily accessed, the Fund may
invest in closed-end investment companies that in turn are authorized to invest
in the securities of such countries.
The Fund may invest any portion of its assets not invested as described above
in high quality money market instruments and repurchase agreements. For
temporary defensive purposes, the Fund may invest its assets without limitation
in these instruments as well as in debt securities issued in various currencies
by companies, governments and supranational
7
<PAGE>
entities located in Latin America and securities issued or guaranteed by the
government of any member country of the Organization for Economic Cooperation
and Development or its agencies or instrumentalities. At times when its
advisers deem it advisable to limit the Fund's exposure to the equity markets
in which it ordinarily invests, the Fund may invest up to 20% of its total
assets in U.S. Government obligations (exclusive of any investments in money
market instruments).To the extent that the Fund departs from its investment
policies during such periods, its investment objective may not be achieved.
For a discussion of certain risks associated with an investment in the Fund,
see "Risk Factors" and "Other Investment Practices" below.
OTHER INVESTMENT
PRACTICES
The Fund may also engage in the following investment practices, when consistent
with the Fund's overall objective and policies. These practices, and certain
associated risks, are more fully described in
the SAI.
U.S. GOVERNMENT OBLIGATIONS. U.S. Government obligations include obligations
issued or guaranteed by the U.S. Government, its agencies or instrumentalities.
MONEY MARKET INSTRUMENTS.
The Fund may invest in cash or high-quality, short-term money market
instruments. These may include U.S. Government securities, commercial paper of
domestic and foreign issuers and obligations of domestic and foreign banks.
Investments in foreign money market instruments may involve certain risks
associated with foreign investment.
DEBT SECURITIES. The Fund may invest in investment grade debt securities, and
may invest up to 5% of the value of its net assets in non-investment grade debt
securities, commonly referred to as "junk bonds." Investment grade debt
securities are securities rated in the category BBB or higher by Standard &
Poor's Corporation ("S&P"), or Baa or higher by Moody's Investors Service, Inc.
("Moody's") or the equivalent by another national rating organization, or, if
unrated, determined by the advisers to be of comparable quality. Debt
securities which do not satisfy these standards are considered by the Fund to
be non-investment grade and involve greater risks than investment grade
securities. See "Risk Factors" below.
DEPOSITARY RECEIPTS. The Fund may invest its assets in securities of foreign
issuers in the form of American Depositary Receipts, European Depositary
Receipts, Global Depositary Receipts or other similar securities representing
securities of foreign issuers (collectively, "Depositary Receipts"). The Fund
treats Depositary Receipts as interests in the underlying securities for
purposes of its investment policies. Unsponsored Depositary Receipts may not
carry comparable voting rights to sponsored Depositary Receipts, and a
purchaser of unsponsored Depositary Receipts may not receive
8
<PAGE>
as much information about the issuer of the underlying securities as with a
sponsored Depositary Receipt.
SUPRANATIONAL OBLIGATIONS.
The Fund may invest in debt securities issued by supranational organizations,
which include organizations such as The World Bank, the European Community, the
European Coal and Steel Community and the Asian Development Bank.
BRADY BONDS AND EMERGING MARKET GOVERNMENT OBLIGATIONS. The Fund's debt
securities may include certain Latin American governmental debt obligations
commonly referred to as Brady Bonds. Brady Bonds are debt securities, generally
denominated in U.S. dollars, issued under the framework of the "Brady Plan," a
program for debtor nations to restructure their outstanding external commercial
bank indebtedness. Brady Bonds have only been issued relatively recently and
accordingly do not have a long payment history. In addition to Brady Bonds, the
Fund may invest in Latin American governmental obligations which may be issued
as a result of other debt restructuring agreements. A substantial portion of
the Brady Bonds and other similar obligations in which the Fund may invest are
likely to be acquired at a significant discount and, accordingly, may exhibit
volatility.
STRUCTURED PRODUCTS. The Fund may invest in structured products, which are
interests in entities organized solely for the purpose of restructuring the
investment characteristics of certain other investments. These investments are
deposited with or purchased by the entities, which then issue securities (the
structured products) backed by, or representing interests in, the underlying
investments. The cash flow on the underlying investments may be apportioned
among the newly issued structured products to create securities with different
investment characteristics such as varying maturities, payment priorities or
interest rate provisions, and the extent of the payments made with respect to
structured investments depends on the amount of the cash flow on the underlying
investments. Structured products are subject to the risks associated with the
underlying market or security, and may be subject to greater volatility than
direct investments in the underlying market or security.
INDEXED INVESTMENTS. The Fund may invest in instruments which are indexed to
certain specific foreign currency exchange rates. The terms of such instruments
may provide that their principal amounts or just their coupon interest rates
are adjusted upwards or downwards (but not below zero) at maturity or on
established coupon payment dates to reflect changes in the exchange rate
between two or more currencies while the obligation is outstanding. Such
indexed investments entail the risk of loss of principal and/or interest
payments from currency movements in addition to principal risk, but offer the
potential for realizing gains as a result of changes in foreign currency
exchange rates.
9
<PAGE>
REPURCHASE AGREEMENTS, SECURITIES LOANS AND FORWARD AND STAND-BY
COMMITMENTS. The Fund may enter into agreements to purchase and resell
securities at an agreed-upon price and time. The Fund also has the ability to
lend portfolio securities in an amount equal to not more than 30% of its total
assets to generate additional income. These transactions must be fully
collateralized at all times. The Fund may purchase securities for delivery at a
future date, which may increase its overall investment exposure and involves a
risk of loss if the value of the securities declines prior to the settlement
date. The Fund may enter into put transactions, including those sometimes
referred to as stand-by commitments, with respect to securities in its
portfolio. In these transactions, the Fund would acquire the right to sell a
security at an agreed upon price within a specified period prior to its
maturity date. A put transaction will increase the cost of the underlying
security and consequently reduce the available yield. Each of these
transactions involve some risk to the Fund if the other party should default on
its obligation and the Fund is delayed or prevented from recovering the
collateral or completing the transaction.
BORROWINGS AND REVERSE REPURCHASE AGREEMENTS.
The Fund may borrow money from banks for temporary or short-term purposes, but
will not borrow money to buy additional securities, known as "leveraging." The
Fund may also sell and simultaneously commit to repurchase a portfolio security
at an agreed-upon price and time. The Fund may use this practice to generate
cash for shareholder redemptions without selling securities during unfavorable
market conditions. Whenever the Fund enters into a reverse repurchase
agreement, it will establish a segregated account in which it will maintain
liquid assets on a daily basis in an amount at least equal to the repurchase
price (including accrued interest). The Fund would be required to pay interest
on amounts obtained through reverse repurchase agreements, which are considered
borrowings under federal securities laws.
CONVERTIBLE SECURITIES. The Fund may invest in convertible securities, which
are securities generally offering fixed interest or dividend yields which may
be converted either at a stated price or stated rate for common or preferred
stock. Although to a lesser extent than with fixed-income securities generally,
the market value of convertible securities tends to decline as interest rates
increase, and increase as interest rates decline. Because of the conversion
feature, the market value of convertible securities also tends to vary with
fluctuations in the market value of the underlying common or preferred stock.
LOAN PARTICIPATIONS. The Fund may invest in participations in fixed and
floating rate loans arranged through private negotiations between a borrower
and one or more financial institutions. When investing in a participation, the
Fund will typically have the right to receive payments only from the lender,
and not from the borrower itself, to the extent the lender receives payments
10
<PAGE>
from the borrower. Accordingly, the Fund may be subject to the credit risk of
both the borrower and the lender. Loan participations may be illiquid.
OTHER INVESTMENT COMPANIES. Apart from being able to invest all of its
investable assets in another investment company having substantially the same
investment objectives and policies, the Fund may invest up to 10% of its total
assets in shares of other investment companies when consistent with its
investment objective and policies, subject to applicable regulatory
limitations. Additional fees may be charged by other investment companies.
STRIPS. The Fund may invest up to 20% of its total assets in stripped
obligations (i.e., separately traded principal and interest components of
securities) where the underlying obligation is backed by the full faith and
credit of the U.S. Government, including instruments known as "STRIPS." The
value of these instruments tends to fluctuate more in response to changes in
interest rates than the value of ordinary interest-paying debt securities with
similar maturities. The risk is greater when the period to maturity is longer.
DERIVATIVES AND RELATED INSTRUMENTS. The Fund may invest its assets in
derivative and related instruments to hedge various market risks or to
increase its income or gain. Some of these instruments will be subject to asset
segregation requirements to cover the Fund's obligations. The Fund may (i)
purchase, write and exercise call and put options on securities and securities
indexes (including using options in combination with securities, other options
or derivative instruments); (ii) enter into swaps, futures contracts and
options on futures contracts; (iii) employ forward currency and interest rate
contracts; and (iv) purchase and sell structured products, as described above.
There are a number of risks associated with the use of derivatives and related
instruments and no assurance can be given that any strategy will succeed. The
value of certain derivatives or related instruments in which the Fund invests
may be particularly sensitive to changes in prevailing economic conditions and
market value. The ability of the Fund to successfully utilize these instruments
may depend in part upon the ability of its advisers to forecast these factors
correctly. Inaccurate forecasts could expose the Fund to a risk of loss. There
can be no guarantee that there will be a correlation between price movements in
a hedging instrument and in the portfolio assets being hedged. The Fund is not
required to use any hedging strategies. Hedging strategies, while reducing risk
of loss, can also reduce the opportunity for gain. Derivatives transactions not
involving hedging may have speculative characteristics, involve leverage and
result in losses that may exceed the original investment of the Fund. There can
be no assurance that a liquid market will exist at a time when the Fund seeks
to close out a derivatives position. Activities of large traders in the futures
and securities markets involving arbitrage, "program trading," and other
investment strategies may cause price
11
<PAGE>
distortions in derivatives markets. In certain instances, particularly those
involving over-the-counter transactions or forward contracts, there is a
greater potential that a counterparty or broker may default. In the event of a
default, the Fund may experience a loss. For additional information concerning
derivatives, related instruments and the associated risks, see the SAI.
PORTFOLIO TURNOVER. The frequency of the Fund's buy and sell transactions will
vary from year to year. The Fund's investment policies may lead to frequent
changes in investments, particularly in periods of rapidly changing market
conditions. High portfolio turnover rates would generally result in higher
transaction costs, including brokerage commissions or dealer mark-ups, and
would make it more difficult for the Fund to qualify as a registered investment
company under federal tax law. See "How Distributions are Made; Tax
Information."
LIMITING INVESTMENT RISKS
Specific investment restrictions help the Fund limit investment risks for its
shareholders. These restrictions prohibit the Fund from: (a) investing more
than 15% of its net assets in illiquid securities (which include securities
restricted as to resale unless they are determined to be readily marketable in
accordance with procedures established by the Board of Trustees) or (b)
investing more than 25% of its total assets in any one industry. A complete
description of these and other investment policies is included in the SAI.
Except for the Fund's investment objective, restriction (b) above and
investment policies designated as fundamental in the SAI, the Fund's investment
policies are not fundamental. The Trustees may change any non-fundamental
investment policy without shareholder approval.
RISK FACTORS
The net asset value of the shares of the Fund will fluctuate based on the value
of the securities in the Fund's portfolio. As the Fund invests primarily in
equity securities of companies outside the U.S., an investment in its shares
involves a higher degree of risk than an investment in a U.S. equity fund. An
investment in the Fund should not be considered a complete investment program
and may not be appropriate for all investors.
Latin American economies have experienced considerable difficulties in the past
decade. Although there have been significant improvements in recent years, the
Latin American economies continue to experience challenging problems, including
high inflation rates and high interest rates relative to the United States. The
emergence of the Latin American economies and securities markets will require
continued economic and fiscal discipline which has been lacking at times in the
past, as well as stable political and social conditions. Recovery may also be
influenced by international economic conditions, particularly those in the
United States, and by world prices for oil and other commodities. There is no
assurance that recent economic initiatives will be successful.
12
<PAGE>
Since Latin American securities are normally denominated and traded in foreign
currencies, the values of the Fund's Latin American investments may be
influenced by currency exchange rates and exchange control regulations. Some of
the currencies of Latin American countries have experienced steady devaluations
relative to the United States dollar, and major adjustments have been made in
certain of these currencies periodically. Some Latin American countries may
also have managed currencies, which are not free floating against the United
States dollar. In addition, there is risk that certain Latin American countries
may restrict the free conversion of their currencies into other currencies.
Further, it generally will not be possible to reduce the Fund's Latin American
currency risk through hedging. Devaluations in the currencies in which the
Fund's portfolio securities are denominated will adversely affect the Fund's
net asset value.
There may be less information publicly available about Latin American issuers
than U.S. issuers, and they are not generally subject to accounting, auditing
and financial reporting standards and practices comparable to those in the U.S.
Latin American securities markets are smaller, less liquid and have more
limited trading volume than those in the United States. Such factors could
cause the prices of Latin American securities to be erratic for reasons apart
from factors that affect the quality of securities.
Most Latin American countries have experienced substantial, and in some
periods, extremely high, rates of inflation for many years. Inflation and rapid
fluctuations in inflation rates have had and may continue to have negative
effects on the economies and securities markets of certain Latin American
countries.
Certain Latin American countries are among the largest debtors to commercial
banks and foreign governments. Some of these countries have in the past
defaulted on their sovereign debt. Holders of sovereign debt (which may include
the Fund) may be requested to participate in the rescheduling of such debt and
to extend further loans to governmental entities. There is no bankruptcy
proceeding by which sovereign debt on which governmental entities have
defaulted may be collected in whole or in part.
Latin American settlement procedures and trade regulations may involve certain
expenses and risks. One risk would be the delay in payment or delivery of
securities or in the recovery of the Fund's assets held abroad. This factor
could impede the ability of the Fund to effect portfolio transactions on a
timely basis and could have an adverse impact on the net asset value of the
Fund's shares.
It is possible that nationalization or expropriation of assets, imposition of
currency exchange controls, taxation by withholding Fund assets, political or
financial instability and diplomatic developments could affect the value of the
Fund's investments in certain Latin American countries.
Certain national policies may impede the Fund's investment opportunities,
including restrictions on investing in issuers or industries deemed sensitive
to relevant national interests. For example, the
13
<PAGE>
Fund currently does not intend to invest directly in Chile due to certain
restrictions and deposit requirements imposed on foreign investors.
Additionally, special tax considerations will apply to foreign securities, such
as the imposition of withholding taxes, and there may be an absence of
developed legal structures governing private or foreign investment and private
property.
Although there is a trend toward less government involvement in commerce,
governments of many Latin American countries have exercised and continue to
exercise substantial influence over many aspects of the private sector. In
certain countries, the government still owns or controls many companies,
including some of the largest in the country. Accordingly, government actions
in the future could have a significant effect on economic conditions in Latin
American countries, which could affect private sector companies and the Fund,
as well as the value of securities in the Fund's portfolio.
Some of the Latin American equity securities in which the Fund may invest may
be issued by smaller companies. The securities of smaller companies, whether
Latin American or domestic, often trade less frequently and in lower volume
than securities of larger, more established companies. Consequently, price
changes may be more abrupt or erratic. Such companies may have limited product
lines, markets or financial resources, or may depend on a limited management
group.
Securities rated in the lowest investment grade category lack certain
investment characteristics and may have speculative characteristics.
Non-investment grade debt securities, commonly referred to as "junk bonds,"
involve greater risks than investment grade securities (including risks
relating to default or bankruptcy of the issuer) and are regarded as
speculative in nature.
Because the Fund is "non-diversified," the value of its shares may be more
susceptible to developments affecting the specific companies whose securities
are owned by the Fund.
For a discussion of certain other risks associated with the Fund's additional
investment activities, see "Other Investment Practices" above.
MANAGEMENT
THE FUND'S ADVISERS
The Chase Manhattan Bank ("Chase") is the Fund's investment adviser under an
Investment Advisory Agreement and has overall responsibility for investment
decisions of the Fund, subject to the oversight of the Board of Trustees. Chase
is a wholly-owned subsidiary of The Chase Manhattan Corporation, a bank holding
company. Chase and its predecessors have over 100 years of money management
experience.
For its investment advisory services to the Fund, Chase is entitled to receive
an annual fee computed daily and paid monthly based at an annual rate equal to
1.00% of the Fund's average daily net assets. Chase is located at 270 Park
Avenue, New York, New York 10017.
14
<PAGE>
Chase Asset Management, Inc. ("CAM"), a registered investment adviser, is the
sub-investment adviser to the Fund under a Sub-Investment Advisory Agreement
between CAM and Chase. CAM is a wholly-owned operating subsidiary of Chase. CAM
makes investment decisions for the Fund on a day-to-day basis. For these
services, CAM is entitled to receive a fee, payable by Chase from its advisory
fee, at an annual rate equal to 0.50% of the Fund's average daily net assets.
CAM provides discretionary investment advisory services to institutional
clients. The same individuals who serve as portfolio managers for Chase also
serve as portfolio managers for CAM. CAM is located at 1211 Avenue of the
Americas, New York, New York 10036.
PORTFOLIO MANAGERS. Wayne Perkins, a Vice President of Chase, has been
responsible for the management of Latin American Equity Fund since its
inception. Mr. Perkins has been involved in investment management in the Latin
American region since 1987 and is currently responsible for investment
management and equity research in the Latin American region. Mr. Perkins joined
Chase in 1976.
ABOUT YOUR INVESTMENT
CHOOSING A SHARE CLASS
CLASS A SHARES. An investor who purchases Class A shares pays a sales charge at
the time of purchase. As a result, Class A shares are not subject to any sales
charges when they are redeemed. Certain purchases of Class A shares qualify for
reduced sales charges. Class A shares have lower combined 12b-1 and service
fees than Class B shares. See "How to Buy, Sell and Exchange Shares" and "Other
Information Concerning the Fund."
CLASS B SHARES. Class B shares are sold without an initial sales charge, but
are subject to a contingent deferred sales charge ("CDSC") if redeemed within a
specified period after purchase. Class B shares also have higher combined 12b-1
and service fees than Class A shares.
Class B shares automatically convert into Class A shares, based on relative net
asset value, at the beginning of the ninth year after purchase. For more
information about the conversion of Class B shares, see the SAI. This
discussion will include information about how shares acquired through
reinvestment of distributions are treated for conversion purposes. Class B
shares provide an investor the benefit of putting all of the investor's dollars
to work from the time the investment is made. Until conversion, Class B shares
will have a higher expense ratio and pay lower dividends than Class A shares
because of the higher combined 12b-1 and service fees. See "How to Buy, Sell
and Exchange Shares" and "Other Information Concerning the Fund."
WHICH ARRANGEMENT IS BEST FOR YOU? The decision as to which class of shares
provides a more suitable investment for you depends on a number of factors,
including the amount and intended length of the investment. If you are making
an investment that qualifies for reduced sales charges, you might
15
<PAGE>
consider Class A shares. If you prefer not to pay an initial sales charge and
anticipate holding your shares for a number of years, you might consider Class
B shares. In almost all cases, if you are planning to purchase $250,000 or more
of the Fund's shares you will pay lower aggregate charges and expenses by
purchasing Class A shares.
HOW TO BUY, SELL
AND EXCHANGE SHARES
HOW TO BUY SHARES
You can open a Fund account with as little as $2,500 for regular accounts,
$1,000 for traditional and Roth IRAs, SEP-IRAs and the Systematic Investment
Plan, or $500 for Education IRAs. Additional investments can be made at any
time with as little as $100. Holders of omnibus accounts with the Fund may set
their own minimum amounts for investment through such accounts. You can buy
Fund shares three ways--through an investment representative, through the
Fund's distributor by calling the Chase Vista Service Center, or through the
Systematic Investment Plan.
All purchases made by check should be in U.S. dollars and made payable to the
Chase Vista Funds. Third party checks, credit cards and cash will not be
accepted. The Fund reserves the right to reject any purchase order or cease
offering shares for purchase at any time. When purchases are made by check,
redemptions will not be allowed until the check clears, which may take 15
calendar days or longer. In addition, the redemption of shares purchased
through Automated Clearing House (ACH) will not be allowed until your payment
clears, which may take 7 business days or longer.
BUYING SHARES THROUGH THE FUND'S DISTRIBUTOR. Complete and return the enclosed
application and your check in the amount you wish to invest to the Chase Vista
Service Center.
BUYING SHARES THROUGH SYSTEMATIC INVESTING. You can make regular investments of
$100 or more per transaction through automatic periodic deduction from your
bank checking or savings account. Shareholders electing to start this
Systematic Investment Plan when opening an account should complete Section 8 of
the account application. Current shareholders may begin such a plan at any time
by sending a signed letter and a deposit slip or voided check to the Chase
Vista Service Center. Call the Chase Vista Service Center at 1-800-34-VISTA for
complete instructions.
Shares are purchased at the public offering price, which is based on the net
asset value next determined after the Chase Vista Service Center receives your
order in proper form. In most cases, in order to receive that day's public
offering price, the Chase Vista Service Center must receive your order in
proper form before the close of regular trading on the New York Stock Exchange.
If you buy shares through your investment representative, the representative
must receive your order before the close of regular trading on the New York
Stock Exchange to receive that day's public offering price. Orders are in
proper form only after funds are converted to federal funds. Orders
16
<PAGE>
paid by check and received by 2:00 p.m., Eastern Time will generally be
available for the purchase of shares the following business day.
If you are considering redeeming or exchanging shares or transferring shares to
another person shortly after purchase, you should pay for those shares with a
certified check to avoid any delay in redemption, exchange or transfer.
Otherwise the Fund may delay payment until the purchase price of those shares
has been collected or, if you redeem by telephone, until 15 calendar days after
the purchase date. To eliminate the need for safekeeping, the Fund will not
issue certificates for your Class A shares unless you request them. Due to the
conversion feature of Class B shares, certificates for Class B shares will not
be issued and all Class B shares will be held in book entry form.
Class A Shares
The public offering price of Class A shares is the net asset value plus a sales
charge that varies depending on the size of your purchase. The Fund receives
the net asset value. The sales charge is allocated between your broker-dealer
and the Fund's distributor as shown in the following table, except when the
Fund's distributor, in its discretion, allocates the entire amount to your
broker-dealer.
Amount of
Sales charge as a sales charge
percentage of: reallowed to
----------------------- dealers as a
Amount of transaction at Offering Net amount percentage of
offering price($) price invested offering price
- --------------------------------------------------------------------------------
Under 100,000 ................... 4.75 4.99 4.00
100,000 but under 250,000 ....... 3.75 3.90 3.25
250,000 but under 500,000 ....... 2.50 2.56 2.25
500,000 but under 1,000,000 ..... 2.00 2.04 1.75
There is no initial sales charge on purchases of Class A shares of $1 million
or more.
The Fund's distributor pays broker-dealers commissions on net sales of Class A
shares of $1 million or more based on an investor's cumulative purchases of
shares of a Fund. Such commissions are paid at the rate of 1.00% of the amount
under $2.5 million, 0.75% of the next $7.5 million, 0.50% of the next $40
million and 0.20% thereafter. The Fund's distributor may withhold such payments
with respect to short-term investments.
Class B Shares
Class B shares are sold without an initial sales charge, although a CDSC will
be imposed if you redeem shares within a specified period after purchase, as
shown in the table below. The following types of shares may be redeemed without
charge at any time: (i) shares acquired by reinvestment of distributions and
(ii) shares otherwise exempt from the CDSC, as described below. For other
shares, the amount of the charge is determined as a percentage of the lesser of
the current market value or the purchase price of shares being redeemed.
17
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Year 1 2 3 4 5 6 7 8+
- ------ ---- ---- ---- ---- ---- ---- ---- ---
CDSC 5% 4% 3% 3% 2% 1% 0% 0%
</TABLE>
In determining whether a CDSC is payable on any redemption, the Fund will first
redeem shares not subject to any charge, and then shares held longest during
the CDSC period. When a share that has appreciated in value is redeemed during
the CDSC period, a CDSC is assessed only on its initial purchase price. For
information on how sales charges are calculated if you exchange your shares,
see "How to Exchange Your Shares." The Fund's distributor pays broker-dealers a
commission of 4.00% of the offering price on sales of Class B shares, and the
distributor receives the entire amount of any CDSC you pay.
GENERAL
You may be eligible to buy Class A shares at reduced sales charges. Consult
your investment representative or the Chase Vista Service Center for details
about Chase Vista's combined purchase privilege, cumulative quantity discount,
statement of intention, group sales plan, employee benefit plans, and other
plans. Descriptions are also included in the enclosed application and in the
SAI. For purchases of the Funds' Class A shares made from January 1, 1998
through April 30, 1998, no initial sales charge will be assessed if you are
opening or adding to a Vista prototype IRA by transferring or rolling over
$5,000 or more of assets from a qualified plan, consisting of redemption
proceeds from non-Chase Vista mutual funds on which you paid a front-end or
deferred sales load. In connection with such purchases of Class A shares, the
Funds' distributor will pay broker-dealers a 1% commission. If you open or add
to a Vista prototype IRA, from January 1, 1998 through April 30, 1998, by
investing $5,000 or more, the annual IRA maintenance fee payable to the IRA
sponsor will be waived for the life of the account. In addition, sales charges
are waived if you are using redemption proceeds received within the prior
ninety days from non-Chase Vista mutual funds to buy your shares, and on which
you paid a front-end or contingent deferred sales charge.
Some participant-directed employee benefit plans participate in a "multi-fund"
program which offers both Chase Vista and non-Chase Vista mutual funds. With
Board of Trustee approval, the money that is invested in Chase Vista Funds may
be combined with the other mutual funds in the same program when determining
the Plan's eligibility to buy Class A shares without a sales charge. These
investments will also be included for purposes of the discount privileges and
programs described above.
The Fund may sell Class A shares at net asset value without an initial sales
charge to the Fund's current and retired Trustees (and their immediate
families), current and retired employees (and their immediate families) of
Chase, the Fund's distributor and transfer agent or any affiliates or
subsidiaries thereof, registered representatives and other employees (and their
immediate families) of broker-dealers having selected dealer agreements with
the Fund's distributor, employees (and their immediate families) of financial
institutions having selected dealer
18
<PAGE>
agreements with the Fund's distributor (or otherwise having an arrangement with
a broker-dealer or financial institution with respect to sales of Chase Vista
Fund shares), financial institution trust departments investing an aggregate of
$1 million or more in the Chase Vista Funds and clients of certain
administrators of tax-qualified plans when proceeds from repayments of loans to
participants are invested (or reinvested) in the Chase Vista Funds.
For purchases of the Fund's Class A shares made from January 1, 1998 through
December 31, 1998, no initial sales charge will be assessed if you are
investing the proceeds of an IRA or other qualified plan for which The Chase
Manhattan Bank or its designee serves as trustee or custodian. No initial sales
charge will apply to the purchase of the Fund's Class A shares if you are
investing the proceeds of a qualified retirement plan, where a portion of the
plan was invested in the Chase Vista Funds, any qualified retirement plan with
50 or more participants, or an individual participant in a tax-qualified plan
making a tax-free rollover or transfer of assets from the plan in which Chase
or an affiliate serves as trustee or custodian of the plan or manages some
portion of the plan's assets.
Purchases of the Fund's Class A shares may be made with no initial sales charge
through an investment adviser or financial planner that charges a fee for its
services. Purchases of the Fund's Class A shares may be made with no initial
sales charge (i) by an investment adviser, broker or financial planner,
provided arrangements are preapproved and purchases are placed through an
omnibus account with the Fund or (ii) by clients of such investment adviser or
financial planner who place trades for their own accounts, if such accounts are
linked to a master account of such investment adviser or financial planner on
the books and records of the broker or agent. Such purchases may also be made
for retirement and deferred compensation plans and trusts used to fund those
plans.
Investors may incur a fee if they effect transactions through a broker or
agent.
Purchases of the Fund's Class A shares may be made with no initial sales charge
in accounts opened by a bank, trust company or thrift institution which is
acting as a fiduciary exercising investment discretion, provided that
appropriate notification of such fiduciary relationship is reported at the time
of the investment to the particular Fund, the Fund's distributor or the Chase
Vista Service Center.
Shareholders of record of any Chase Vista Fund as of November 30, 1990 and
certain immediate family members may purchase the Fund's Class A shares with no
initial sales charge for as long as they continue to own Class A shares of any
Chase Vista Fund, provided there is no change in account registration.
The Fund may sell Class A shares at net asset value without an initial sales
charge in connection with the acquisition by the Fund of assets of an
investment company or personal holding company. The CDSC will be waived on
redemption of Class B shares arising out of death or disability or in
connection with certain withdrawals from IRA or other retirement plans. Up to
12% of the value of Class B shares subject
19
<PAGE>
to a systematic withdrawal plan may also be redeemed each year without a CDSC,
provided that the Class B account had a minimum balance of $20,000 with respect
to the applicable Fund at the time the systematic withdrawal plan was
established. The SAI contains additional information about purchasing the
Fund's shares at reduced sales charges.
The Fund reserves the right to change any of these policies on purchases
without an initial sales charge at any time and may reject any such purchase
request.
For shareholders that bank with Chase, Chase may aggregate investments in the
Chase Vista Funds with balances held in Chase bank accounts for purposes of
determining eligibility for certain bank privileges that are based on specified
minimum balance requirements, such as reduced or no fees for certain banking
services or preferred rates on loans and deposits. Chase and certain broker-
dealers and other shareholder servicing agents may, at their own expense,
provide gifts, such as computer software packages, guides and books related to
investment or additional Fund shares valued up to $250 to their customers that
invest in the Chase Vista Funds.
Shareholders of other Chase Vista Funds may be entitled to exchange their
shares for, or reinvest distributions from their funds in, shares of the Fund
at net asset value.
HOW TO SELL SHARES
You can sell your Fund shares any day the New York Stock Exchange is open,
either directly to the Fund or through your investment representative. The Fund
will only forward redemption payments on shares for which it has collected
payment of the purchase price.
SELLING SHARES DIRECTLY TO A FUND. Send a signed letter of instruction to the
Chase Vista Service Center, along with any certificates that represent shares
you want to sell. The price you will receive is the next net asset value
calculated after the Fund receives your request in proper form, less any
applicable CDSC. In order to receive that day's net asset value, the Chase
Vista Service Center must receive your request before the close of regular
trading on the New York Stock Exchange.
SIGNATURE GUARANTEES. If you sell shares having a net asset value of $100,000
or more, the signatures of registered owners or their legal representatives
must be guaranteed by a bank, broker-dealer or certain other financial
institutions. See the SAI for more information about where to obtain a
signature guarantee.
If you want your redemption proceeds sent to an address other than your address
as it appears on Chase Vista's records, a signature guarantee is required. The
Fund may require additional documentation for the sale of shares by a
corporation, partnership, agent or fiduciary, or a surviving joint owner.
Contact the Chase Vista Service Center for details.
DELIVERY OF PROCEEDS. The Fund generally sends you payment for your shares the
business day after your request is received in proper form, assuming the Fund
has collected payment of the purchase price of your shares. Under unusual
circumstances, the Fund may suspend
20
<PAGE>
redemptions, or postpone payment for more than seven days, as permitted by
federal securities law.
TELEPHONE REDEMPTIONS. You may use Vista's Telephone Redemption Privilege to
redeem shares from your account unless you have notified the Chase Vista
Service Center of an address change within the preceding 30 days. Telephone
redemption requests in excess of $25,000 will only be made by wire to a bank
account on record with the Fund. There will be a $10.00 charge for each wire
transaction. Unless an investor indicates otherwise on the account application,
the Fund will be authorized to act upon redemption and transfer instructions
received by telephone from a shareholder, or any person claiming to act as his
or her representative, who can provide the Fund with his or her account
registration and address as it appears on the Fund's records.
The Chase Vista Service Center will employ these and other reasonable
procedures to confirm that instructions communicated by telephone are genuine;
if it fails to employ reasonable procedures, the Fund may be liable for any
losses due to unauthorized or fraudulent instructions. An investor agrees,
however, that to the extent permitted by applicable law, neither the Fund nor
its agents will be liable for any loss, liability, cost or expense arising out
of any redemption request, including any fraudulent or unauthorized request.
For information, consult the Chase Vista Service Center.
During periods of unusual market changes and shareholder activity, you may
experience delays in contacting the Chase Vista Service Center by telephone. In
this event, you may wish to submit a written redemption request, as described
above, or contact your investment representative. The Telephone Redemption
Privilege is not available if you were issued certificates for shares that
remain outstanding. The Telephone Redemption Privilege may be modified or
terminated without notice.
SYSTEMATIC WITHDRAWAL.
You can make regular withdrawals of $50 or more ($100 or more for Class B
accounts) monthly, quarterly or semiannually. A minimum account balance of
$5,000 is required to establish a systematic withdrawal plan for Class A
accounts. Call the Chase Vista Service Center at 1-800-34-VISTA for complete
instructions.
SELLING SHARES THROUGH YOUR INVESTMENT REPRESENTATIVE. Your investment
representative must receive your request before the close of regular trading on
the New York Stock Exchange to receive that day's net asset value. Your
investment representative will be responsible for furnishing all necessary
documentation to the Chase Vista Service Center, and may charge you for its
services.
INVOLUNTARY REDEMPTION OF ACCOUNTS. The Fund may involuntarily redeem your
shares if at such time the aggregate net asset value of the shares in your
account is less than $500 due to redemptions or if you purchase through the
Systematic Investment Plan and fail to meet the Fund's investment minimum
within a twelve month period. In the event of any such
21
<PAGE>
redemption, you will receive at least 60 days notice prior to the redemption.
In the event a Fund redeems Class B shares pursuant to this provision, no CDSC
will be imposed.
HOW TO EXCHANGE YOUR SHARES
You can exchange your shares for shares of the same class of certain other
Chase Vista Funds at net asset value beginning 15 days after purchase. Not all
Chase Vista Funds offer all classes of shares. The prospectus of the other
Chase Vista Fund into which shares are being exchanged should be read carefully
and retained for future reference. If you exchange shares subject to a CDSC,
the transaction will not be subject to the CDSC. However, when you redeem the
shares acquired through the exchange, the redemption may be subject to the
CDSC, depending upon when you originally purchased the shares. The CDSC will be
computed using the schedule of any fund into or from which you have exchanged
your shares that would result in your paying the highest CDSC applicable to
your class of shares. In computing the CDSC, the length of time you have owned
your shares will be measured from the date of original purchase and will not be
affected by any exchange.
EXCHANGING TO MONEY MARKET FUNDS. An exchange of Class B shares into any of the
Chase Vista money market funds (other than the Class B shares of the Prime
Money Market Fund in the case of Class B shares) will be treated as a
redemption--and therefore subject to the conditions of the CDSC --
and a subsequent purchase. Class B shares of any Chase Vista non-money market
fund may be exchanged into the Class B shares of the Prime Money Market Fund in
order to continue the aging of the initial purchase of such shares.
For federal income tax purposes, an exchange is treated as a sale of shares and
generally results in a capital gain or loss.
EXCHANGING BY PHONE. A Telephone Exchange Privilege is currently available.
Call the Chase Vista Service Center for procedures for telephone transactions.
The Telephone Exchange Privilege is not available if you were issued
certificates for shares that remain outstanding. Ask your investment
representative or the Chase Vista Service Center for prospectuses of other
Chase Vista Funds. Shares of certain Chase Vista Funds are not available to
residents of all states.
EXCHANGE PARAMETERS. The exchange privilege is not intended as a vehicle for
short-term trading. Excessive exchange activity may interfere with portfolio
management and have an adverse effect on all shareholders. In order to limit
excessive exchange activity and in other circumstances where Chase Vista
management or the Trustees believe doing so would be in the best interests of
the Fund, the Fund reserves the right to revise or terminate the exchange
privilege, limit the amount or number of exchanges or reject any exchange. In
addition, any shareholder who makes more than ten exchanges of shares involving
the Fund in a year or three in a calendar quarter will be charged a $5.00
administration fee for each such exchange. Shareholders would be notified
22
<PAGE>
of any such action to the extent required by law. Consult the Chase Vista
Service Center before requesting an exchange. See the SAI to find out more
about the exchange privilege.
REINSTATEMENT PRIVILEGE.
Upon written request, Class A shareholders have a one time privilege of
reinstating their investment in the Fund at net asset value within 90 calendar
days of the redemption. The reinstatement request must be accompanied by
payment for the shares (not in excess of the redemption), and shares will be
purchased at the next determined net asset value. Class B shareholders who have
redeemed their shares and paid a CDSC with such redemption may purchase Class A
shares with no initial sales charge (in an amount not in excess of their
redemption proceeds) if the purchase occurs within 90 days of the redemption of
the Class B shares.
HOW THE FUND
VALUES ITS SHARES
The net asset value of each class of the Fund's shares is determined once daily
based upon prices determined as of the close of regular trading on the New York
Stock Exchange (normally 4:00 p.m., Eastern time, however, options are priced
at 4:15 p.m., Eastern time), on each business day of the Fund, by dividing the
net assets of the Fund attributable to that class by the total number of
outstanding shares of that class. Values of assets held by the Fund are
determined on the basis of their market or other fair value, as described in
the SAI.
HOW DISTRIBUTIONS ARE
MADE; TAX INFORMATION
The Fund distributes any net investment income at least semi-annually and any
net realized capital gains at least annually. Capital gains are distributed
after deducting any available capital loss carryovers. Distributions paid by
the Fund with respect to Class A shares will generally be greater than those
paid with respect to Class B shares because expenses attributable to Class B
shares will generally be higher.
DISTRIBUTION PAYMENT OPTION. You can choose from three distribution options:
(1) reinvest all distributions in additional Fund shares without a sales
charge; (2) receive distributions from net investment income in cash or by ACH
to a pre-established bank account while reinvesting capital gains distributions
in additional shares without a sales charge; or (3) receive all distributions
in cash or by ACH. You can change your distribution option by notifying the
Chase Vista Service Center in writing. If you do not select an option when you
open your account, all distributions will be reinvested. All distributions not
paid in cash or by ACH will be reinvested in shares of the same share class.
You will receive a statement confirming reinvestment of distributions in
additional Fund shares promptly following the quarter in which the reinvestment
occurs.
If a check representing a Fund distribution is not cashed within a specified
period, the Chase Vista Service Center will notify you that you have the option
of requesting another check or reinvesting the
23
<PAGE>
distribution in the Fund or in an established account of another Chase Vista
Fund without a sales charge. If the Chase Vista Service Center does not receive
your election, the distribution will be reinvested in the Fund. Similarly, if
the Fund or the Chase Vista Service Center sends you correspondence returned as
"undeliverable," distributions will automatically be reinvested in the Fund.
The Fund intends to qualify as a "regulated investment company" for federal
income tax purposes and to meet all other requirements that are necessary for
it to be relieved of federal taxes on income and gains it distributes to
shareholders. The Fund intends to distribute substantially all of its ordinary
income and capital gain net income on a current basis. If the Fund does not
qualify as a regulated investment company for any taxable year or does not make
such distributions, the Fund will be subject to tax on all of its income and
gains.
TAXATION OF DISTRIBUTIONS. All Fund distributions of net investment income
(which term includes net short-term capital gain) will be taxable as ordinary
income. Any distributions of net capital gain which are designated as "capital
gain dividends" will be taxable as long-term capital gain at the currently
applicable 28% or 20% rate, regardless of how long you have held the shares.
The taxation of your distributions is the same whether received in cash or in
shares through the reinvestment of distributions.
Investment income received by the Fund from sources within foreign countries
may be subject to foreign taxes withheld at the source. Since more than 50% of
the value of the total assets of the Fund at the close of its taxable year is
anticipated to be stock or securities of foreign corporations, the Fund may
elect to "pass through" to its shareholders the amount of foreign taxes paid by
the Fund.
You should carefully consider the tax implications of purchasing shares just
prior to a distribution. This is because you will be taxed on the entire amount
of the distribution received, even though the net asset value per share will be
higher on the date of such purchase as it will include the distribution amount.
Early in each calendar year the Fund will notify you of the amount and tax
status of distributions paid to you by the Fund for the preceding year.
The above is only a summary of certain federal income tax consequences of
investing in the Fund. You should consult your tax adviser to determine the
precise effect of an investment in the Fund on your particular tax situation
(including possible liability for state and local taxes and, for foreign
shareholders, U.S. withholding taxes).
OTHER INFORMATION
CONCERNING THE FUND
DISTRIBUTION PLANS
The Fund's distributor is Vista Fund Distributors, Inc. ("VFD"). VFD is a
subsidiary of The BISYS Group, Inc. and is unaffiliated with Chase. The Trust
has adopted Rule 12b-1 distribution plans for Class A and Class B shares, which
provide for the payment of distribution fees at annual rates of up to 0.25% and
0.75% of the average daily net assets
24
<PAGE>
attributable to Class A and Class B shares of the Fund, respectively. Payments
under the distribution plans shall be used to compensate or reimburse the
Fund's distributor and broker-dealers for services provided and expenses
incurred in connection with the sale of Class A and Class B shares, and are not
tied to the amount of actual expenses incurred. Payments may be used to
compensate broker-dealers with trail or maintenance commissions at an annual
rate of up to 0.25% of the average daily net asset value of Class A and Class B
shares invested in a Fund by customers of these broker-dealers. Trail or
maintenance commissions are paid to broker-dealers beginning the 13th month
following the purchase of shares by their customers. Promotional activities for
the sale of Class A and Class B shares will be conducted generally by the Chase
Vista Funds, and activities intended to promote the Fund's Class A and Class B
shares may also benefit the Fund's other shares and other Chase Vista Funds.
VFD may provide promotional incentives to broker-dealers that meet specified
targets for one or more Chase Vista Funds. These incentives may include gifts
of up to $100 per person annually; an occassional meal, ticket to a sporting
event or theater for entertainment for broker dealers and their guests; and
payment or reimbursement for travel expenses, including lodging and meals, in
connection with attendance at training and educational meetings within and
outside the U.S.
VFD may provide promotional incentives to broker-dealers that meet specified
sales targets for one or more Chase Vista Funds. These incentives may include
gifts of up to $100 per person annually; an occasional meal, ticket to a
sporting event or theater for entertainment for broker-dealers and their
guests; and payment or reimbursement for travel expenses, including lodging and
meals, in connection with attendance at training and educational meetings
within and outside the U.S.
VFD may from time to time, pursuant to objective criteria established by it,
pay additional compensation to qualifying authorized broker-dealers for certain
services or activities which are primarily intended to result in sales of
shares of the Fund. In some instances, such compensation may be offered only to
certain broker-dealers who employ registered representatives who have sold or
may sell significant amounts of shares of the Fund and/or other Vista Funds
during a specified period of time. Such compensation does not represent an
additional expense to the Fund or its shareholders, since it will be paid by
VFD out of compensation retained by it from the Fund or other sources available
to it.
SHAREHOLDER SERVICING AGENTS
The Trust has entered into shareholder servicing agreements with certain
shareholder servicing agents (including Chase) under which the shareholder
servicing agents have agreed to provide certain support services to their
customers who beneficially own Class A or Class B shares of the Fund. These
25
<PAGE>
services include one or more of the following: assisting with purchase and
redemption transactions, maintaining shareholder accounts and records,
furnishing customer statements, transmitting shareholder reports and
communications to customers and other similar shareholder liaison services. For
performing these services, each shareholder servicing agent receives an annual
fee of up to 0.25% of the average daily net assets of Class A or Class B shares
of the Fund held by investors for whom the shareholder servicing agent
maintains a servicing relationship. Shareholder servicing agents may
subcontract with other parties for the provision of shareholder support
services.
Shareholder servicing agents may offer additional services to their customers,
such as pre-authorized or systematic purchase and redemption plans. Each
shareholder servicing agent may establish its own terms and conditions,
including limitations on the amounts of subsequent transactions, with respect
to such services. Certain shareholder servicing agents may (although they are
not required by the Trust to do so) credit to the accounts of their customers
from whom they are already receiving other fees an amount not exceeding such
other fees or the fees for their services as shareholder servicing agents.
Chase and/or VFD may from time to time, at their own expense out of
compensation retained by them from the Fund or other sources available to them,
make additional payments to certain selected dealers or other shareholder
servicing agents for performing administrative services for their customers.
These services include maintaining account records, processing orders to
purchase, redeem and exchange Fund shares and responding to certain customer
inquiries. The amount of such compensation may be up to an additional 0.10%
annually of the average net assets of the Fund attributable to shares of the
Fund held by customers of such shareholder servicing agents. Such compensation
does not represent an additional expense to the Fund or its shareholders, since
it will be paid by Chase and/or VFD.
Chase and its affiliates and the Chase Vista Funds, affiliates, agents, and
subagents may exchange among themselves and others certain information about
shareholders and their accounts, including information used to offer investment
products and insurance products to them, unless otherwise contractually
prohibited.
ADMINISTRATOR AND
SUB-ADMINISTRATOR
Chase acts as the Fund's administrator and is entitled to receive a fee
computed daily and paid monthly at an annual rate equal to 0.10% of the Fund's
average daily net assets.
VFD provides certain sub-administrative services to the Fund pursuant to a
distribution and sub-administration agreement and is entitled to receive a fee
for these services from the Fund at an annual rate equal to 0.05% of the Fund's
average daily net assets. VFD has agreed to use a portion of this fee to pay
for certain expenses incurred in connection with organizing new
26
<PAGE>
series of the Trust and certain other ongoing expenses of the Trust. VFD is
located at One Chase Manhattan Plaza, 3rd Floor, New York, New York 10081.
CUSTODIAN
Chase acts as the Fund's custodian and fund accountant and receives
compensation under an agreement with the Trust. Fund securities and cash may be
held by sub-custodian banks if such arrangements are reviewed and approved by
the Trustees.
EXPENSES
The Fund pays the expenses incurred in its operations, including the Fund's pro
rata share of expenses of the Trust. These expenses include investment advisory
and administrative fees; the compensation of the Trustees; registration fees;
interest charges; taxes; expenses connected with the execution, recording and
settlement of security transactions; fees and expenses of the Fund's custodian
for all services to the Fund, including safekeeping of funds and securities and
maintaining required books and accounts; expenses of preparing and mailing
reports to investors and to government offices and commissions; expenses of
meetings of investors; fees and expenses of independent accountants, of legal
counsel and of any transfer agent, registrar or dividend disbursing agent of
the Trust; insurance premiums; and expenses of calculating the net asset value
of, and the net income on, shares of the Fund. Shareholder servicing and
distribution fees are allocated to specific classes of the Fund. In addition,
the Fund may allocate transfer agency and certain other expenses by class.
Service providers to the Fund may, from time to time, voluntarily waive all or
a portion of any fees to which they are entitled.
ORGANIZATION AND
DESCRIPTION OF SHARES
The Fund is a portfolio of Mutual Fund Group, an open-end management investment
company organized as a Massachusetts business trust in 1987 (the "Trust"). The
Trust has reserved the right to create and issue additional series and classes.
Each share of a series or class represents an equal proportionate interest in
that series or class with each other share of that series or class. The shares
of each series or class participate equally in the earnings, dividends and
assets of the particular series or class. Shares have no preemptive or
conversion rights. Shares when issued are fully paid and non-assessable, except
as set forth below. Shareholders are entitled to one vote for each whole share
held, and each fractional share shall be entitled to a proportionate fractional
vote, except that Trust shares held in the treasury of the Trust shall not be
voted. Shares of each class of the Fund generally vote together except when
required under federal securities laws to vote separately on matters that only
affect a particular class, such as the approval of distribution plans for a
particular class.
The Fund issues multiple classes of shares. This Prospectus relates to Class A
and Class B shares of the Fund. The Fund may offer other classes of shares in
addition to these classes and may determine not to offer certain classes of
shares. The categories of investors that
27
<PAGE>
are eligible to purchase shares and minimum investment requirements may differ
for each class of the Fund's shares. In addition, other classes of Fund shares
may be subject to differences in sales charge arrangements, ongoing
distribution and service fee levels, and levels of certain other expenses,
which would affect the relative performance of the different classes. Investors
may call 1-800-34-VISTA to obtain additional information about other classes of
shares of the Fund that are offered. Any person entitled to receive
compensation for selling or servicing shares of the Fund may receive different
levels of compensation with respect to one class of shares over another.
The business and affairs of the Trust are managed under the general direction
and supervision of its Board of Trustees. The Trust is not required to hold
annual meetings of shareholders but will hold special meetings of shareholders
of all series or classes when in the judgment of the Trustees it is necessary
or desirable to submit matters for a shareholder vote. The Trustees will
promptly call a meeting of shareholders to remove a trustee(s) when requested
to do so in writing by record holders of not less than 10% of all outstanding
shares of the Trust.
Under Massachusetts law, shareholders of such a business trust may, under
certain circumstances, be held personally liable as partners for its
obligations. However, the risk of a shareholder incurring financial loss on
account of shareholder liability is limited to circumstances in which both
inadequate insurance existed and the Trust itself was unable to meet its
obligations.
PERFORMANCE INFORMATION
The Fund's investment performance may from time to time be included in
advertisements about the Fund. Performance is calculated separately for each
class of shares, in the manner described in the SAI. "Yield" for each class of
shares is calculated by dividing the annualized net investment income per share
during a recent 30-day period by the maximum public offering price per share of
such class on the last day of that period.
"Total return" for the one-, five- and ten-year periods (or since inception, if
shorter) through the most recent calendar quarter represents the average annual
compounded rate of return on an investment of $1,000 in the Fund invested at
the maximum public offering price (in the case of Class A shares) or reflecting
the deduction of any applicable contingent deferred sales charge (in the case
of Class B shares). Total return may also be presented for other periods or
without reflecting sales charges. Any quotation of investment performance not
reflecting the maximum initial sales charge or contingent deferred sales charge
would be reduced if such sales charges were used.
All performance data is based on the Fund's past investment results and does
not predict future performance. Investment performance, which will vary, is
based on many factors, including market conditions, the composition of the
Fund's portfolio, the Fund's operating expenses and which class of shares you
purchase. Investment performance also often reflects the risks associated with
the Fund's
28
<PAGE>
investment objectives and policies. These factors should be considered when
comparing the Fund's investment results to those of other mutual funds and
other investment vehicles. Quotation of investment performance for any period
when a fee waiver or expense limitation was in effect will be greater than if
the waiver or limitation had not been in effect. The Fund's performance may be
compared to other mutual funds, relevant indices and rankings prepared by
independent services. See the SAI.
29
<PAGE>
MAKE THE MOST OF YOUR CHASE VISTA PRIVILEGES
The following services are available to you as a Chase Vista Fund shareholder.
[bullet] SYSTEMATIC INVESTMENT PLAN--Invest as much as you wish ($100 or more)
in the first or third week of any month. The amount will be
automatically transferred from your checking or savings account.
[bullet] SYSTEMATIC WITHDRAWAL PLAN--Make regular withdrawals of $50 or more
($100 or more for Class B accounts) monthly, quarterly or
semiannually. A minimum account balance of $5,000 is required to
establish a systematic withdrawal plan for Class A accounts.
[bullet] SYSTEMATIC EXCHANGE--Transfer assets automatically from one Chase
Vista account to another on a regular, prearranged basis. There is no
additional charge for this service.
[bullet] FREE EXCHANGE PRIVILEGE--Exchange money between Chase Vista Funds in
the same class of shares without charge. The exchange privilege allows
you to adjust your investments as your objectives change. Investors
may not maintain, within the same fund, simultaneous plans for
systematic investment or exchange and systematic withdrawal or
exchange.
[bullet] REINSTATEMENT PRIVILEGE--Class A shareholders have a one time
privilege of reinstating their investment in the Fund at net asset
value next determined subject to written request within 90 calendar
days of the redemption, accompanied by payment for the shares (not in
excess of the redemption).
Class B shareholders of the Fund who have redeemed their shares and paid a
CDSC with such redemption may purchase Class A shares with no initial sales
charge (in an amount not in excess of their redemption proceeds) if the
purchase occurs within 90 days of the redemption of the Class B shares.
For more information about any of these services and privileges, call your
shareholder servicing agent, investment representative or the Vista Service
Center at 1-800-34-VISTA. These privileges are subject to change or
termination.
30
<PAGE>
Chase Vista Mutual Funds & Retirement Products
CHASE VISTA INTERNATIONAL EQUITY FUNDS
Latin American Equity Fund
Southeast Asian Fund
Japan Fund
European Fund
International Equity Fund
CHASE VISTA U.S. EQUITY FUNDS
Small Cap Opportunities Fund
Small Cap Equity Fund (closed to new investors)
The Growth Fund of Washington
Capital Growth Fund
Growth and Income Fund
Large Cap Equity Fund
Equity Income Fund
Balanced Fund
CHASE VISTA FIXED INCOME FUNDS
Bond Fund
U.S. Government Securities Fund
U.S. Treasury Income Fund
Short-Term Bond Fund
CHASE VISTA TAX-FREE FUNDS(1)
New York Tax Free Income Fund
California Intermediate Tax Free Fund
Tax Free Income Fund
CHASE VISTA TAX-FREE MONEY MARKET FUNDS(1,2)
New York Tax Free Money Market Fund
Connecticut Daily Tax Free Income Fund Select Shares3
New Jersey Daily Municipal Income Fund Select Shares3
Tax Free Money Market Fund
California Tax Free Money Market Fund
CHASE VISTA TAXABLE MONEY MARKET FUNDS(2)
Cash Management Money Market Fund
Federal Money Market Fund
100% U.S. Treasury Securities Money Market Fund
U.S. Government Money Market Fund
Treasury Plus Money Market Fund
CHASE VISTA RETIREMENT PRODUCTS
Vista Capital Advantage Variable Annuity(4)
Vista 401(k) Advantage
For complete information on the Chase Vista Mutual Funds or Retirement
Products, including information about fees and expenses, call your investment
professional or 1-800-34-VISTA for a prospectus. Please read it carefully
before you invest or send money.
(1)Some income may be subject to certain state and local taxes. A portion of the
income may be subject to the federal alternative minimum tax for some
investors.
(2)An investment in a Money Market Fund is neither insured nor guaranteed by the
U.S. Government. Yields will fluctuate, and there can be no assurance that the
Fund will be able to maintain a stable net asset value of $1.00 per share.
(3)Vista Select Shares of these funds are not a part of, or affiliated with, the
Chase Vista Mutual Funds. Reich & Tang Distributors L.P. and New England
Investment Companies L.P., which are unaffiliated with Chase, are the funds'
distributor and investment adviser, respectively.
(4)The variable annuity contract is issued by First SunAmerica Life Insurance
Company in New York; in other states, but not necessarily all states, it is
issued by Anchor National Life Insurance Company.
31
<PAGE>
CHASE VISTA SERVICE CENTER
P.O. Box 419392
Kansas City, MO 64141-6392
TRANSFER AGENT AND DIVIDEND PAYING AGENT
DST Systems, Inc.
210 West 10th Street
Kansas City, MO 64105
LEGAL COUNSEL
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, NY 10017
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, NY 10036
[CHASE VISTA LOGO]
P.O. Box 419392
Kansas City, MO 64141-6392
VLAE-1-398
