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Rule 497(e)
File No. 811-5545
Registration No. 33-21489
The KeyPremier Prime Money Market Fund
The KeyPremier Pennsylvania Municipal Bond Fund
Two Investment Portfolios of
THE SESSIONS GROUP
Supplement dated as of December 6, 1996 to
Statement of Additional Information dated
July 9, 1996
Capitalized terms used in this Supplement have the meaning assigned to
them in the Statement of Additional Information.
The following is added immediately before the heading "HEDGING
TRANSACTIONS" on page B-10 of the Statement of Additional Information:
SHORT SALES. The Pennsylvania Bond Fund will from time to time
sell securities short. Short sales are effected when it is believed
that the price of a particular security will decline, and involves the
sale of a security which the Pennsylvania Bond Fund does not own in the
hope of purchasing the same security at a later date at a lower price.
To make delivery to the buyer, the Pennsylvania Bond Fund must borrow
the security, and the Pennsylvania Bond Fund is obligated to return the
security to the lender, which is accomplished by a later purchase of
the security by the Pennsylvania Bond Fund. The frequency of short
sales will vary substantially in different periods, and it is not
intended that any specified portion of the Pennsylvania Bond Fund's
assets will as a matter of practice be invested in short sales.
At any time that the Pennsylvania Bond Fund has an open short
sale position, the Pennsylvania Bond Fund is required to segregate with
its custodian (and to maintain such amount until the Pennsylvania Bond
Fund replaces the borrowed security) an amount of cash or U.S.
Government securities or other high-grade liquid debt securities equal
to the difference between (i) the current market value of the
securities sold short and (ii) any cash or U.S. Government securities
required to be deposited with the broker in connection with the short
sale (not including the proceeds from the short sale). As a result of
these requirements, the Pennsylvania Bond Fund will not gain any
leverage merely by selling short, except to the extent that it earns
interest on the immobilized cash or government securities while also
being subject to the possibility of gain or loss from the securities
sold short. The total amount of cash or U.S. Government securities
deposited with the broker (not including the
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proceeds of the short sale) and segregated by the Pennsylvania Bond
Fund with the Pennsylvania Bond Fund's custodian may not at any time be
more than 25% of the Pennsylvania Bond Fund's net assets. These
deposits do not have the effect of limiting the amount of money the
Pennsylvania Bond Fund may lose on a short sale -- the Pennsylvania
Bond Fund's possible losses may exceed the total amount deposited.
The Pennsylvania Bond Fund will incur a loss as a result of
the short sale if the price of the security increases between the date
of the short sale and the date on which the Pennsylvania Bond Fund
purchases the security to replace the borrowed security. The
Pennsylvania Bond Fund will realize a gain if the security declines in
price between those dates. The amount of any gain will be decreased and
the amount of any loss increased by any premium or interest the
Pennsylvania Bond Fund may be required to pay in connection with a
short sale. It should be noted that possible losses from short sales
differ from those that could arise from a cash investment in a security
in that the former may be limitless while the latter can only equal the
total amount of the Pennsylvania Bond Fund's investment in the
security. For example, if the Pennsylvania Bond Fund purchases a $10
security short, the most that can be lost is $10. However, if the
Pennsylvania Bond Fund sells a $10 security short, it may have to
purchase the security for return to the lender when the market value is
$50, thereby incurring a loss of $40.
On page B-15 of the Statement of Additional Information, investment
restrictions no. 2 and 4 have been deleted, investment restrictions no. 3 and 5
have been redesignated investment restrictions no. 2 and 3, respectively, and
the word "and" has been added to the end of newly designated investment
restriction no. 2.
The following paragraph has been added after investment restriction no.
3 on page B-15 of the Statement of Additional Information:
In addition, the Money Market Fund may not engage in any short
sales. However, the Pennsylvania Bond Fund may not engage in short
sales of any securities at any time if, immediately after and as a
result of the short sale, the market value of securities sold short by
the Pennsylvania Bond Fund would exceed 25% of the value of the
Pennsylvania Bond Fund's total assets.
INVESTORS SHOULD RETAIN THIS SUPPLEMENT WITH THE
STATEMENT OF ADDITIONAL INFORMATION FOR FUTURE REFERENCE
