CASH TRUST SERIES, INC.
GOVERNMENT CASH SERIES
MUNICIPAL CASH SERIES
PRIME CASH SERIES
TREASURY CASH SERIES
SUPPLEMENT TO PROSPECTUSES AND STATEMENTS OF ADDITIONAL INFORMATION, AS
APPROPRIATE, DATED SEPTEMBER 30, 1998
I. At the June 30, 1999 shareholder meeting, shareholders approved the
following changes to become effective July 1, 1999:
(1) Elected three Directors.
(2) Ratified the selection of the Company's independent auditors.
II. The meeting was adjourned to September 10, 1999, 2:00 p.m. (Eastern time),
at 2800 Corporate Drive, Pittsburgh, PA 15237-7000 with respect to the
following proposals. Unless shareholders are notified otherwise, these
changes will take effect on September 13, 1999.
(1) To make changes to the Funds' fundamental investment
policies:
(a) To amend the Funds' fundamental investment policy
regarding diversification of its investments
(GOVERNMENT CASH SERIES AND TREASURY CASH SERIES ONLY)
to read as follows:
"With respect to securities comprising 75% of the
value of its total assets, the Fund will not purchase
securities of any one issuer (other than cash; cash
items; securities issued or guaranteed by the
government of the United States or its agencies or
instrumentalities and repurchase agreements
collateralized by such U.S. government securities; and
securities of other investment companies) if, as a
result, more than 5% of the value of its total assets
would be invested in securities of that issuer, or the
Fund would own more than 10% of the outstanding voting
securities of that issuer."
(b) To amend the Funds' fundamental investment policy regarding borrowing money
and issuing senior securities to read as follows:
"The Fund may borrow money, directly or indirectly,
and issue senior securities to the maximum extent permitted under the 1940 Act."
(c) To amend the Funds' fundamental investment policies
regarding investments in real estate (GOVERNMENT CASH
SERIES, MUNICIPAL CASH SERIES AND PRIME CASH SERIES
ONLY) to read as follows:
"The Fund may not purchase or sell real estate,
provided that this restriction does not prevent the
Fund from investing in issuers which invest, deal, or
otherwise engage in transactions in real estate or
interests therein, or investing in securities that are
secured by real estate or interests therein. The Fund
may exercise its rights under agreements relating to
such securities, including the right to enforce
security interests and to hold real estate acquired by
reason of such enforcement until that real estate can
be liquidated in an orderly manner."
(d) To amend the Funds' fundamental investment policy regarding investments in
commodities to read as follows:
"The Fund may not purchase or sell physical
commodities, provided that the Fund may purchase securities of companies that
deal in commodities."
(e) To amend the Funds' fundamental investment policies regarding underwriting
securities to read as follows:
"The Fund may not underwrite the securities of other
issuers, except that the Fund may engage in
transactions involving the acquisition, disposition or
resale of its portfolio securities, under
circumstances where it may be considered to be an
underwriter under the Securities Act of 1933."
(f) To amend the Funds' fundamental investment policies regarding lending by the
Fund to read as follows:
"The Fund may not make loans, provided that this
restriction does not prevent the Fund from purchasing
debt obligations, entering into repurchase agreements,
lending its assets to broker/dealers or institutional
investors and investing in loans, including
assignments and participation interests."
(TREASURY CASH SERIES has no present intention of
engaging in securities lending.)
(g) To amend the Funds' fundamental investment policies regarding concentration
of the Fund's investments in the securities of companies in the same
industry to read as follows:
"The Fund will not make investments that will result
in the concentration of its investments in the
securities of issuers primarily engaged in the same
industry. Government securities, municipal securities
and bank instruments will not be deemed to constitute
an industry. To conform to the current view of the SEC
staff that only domestic bank instruments may be
excluded from industry concentration limitations, as a
matter of non-fundamental policy, the Fund will not
exclude foreign bank instruments from industry
concentration tests as long as the policy of the SEC
remains in effect."
(h) To amend and make non-fundamental the Funds' fundamental investment policy
regarding buying securities on margin to read as follows:
"The Fund will not purchase securities on margin,
provided that the Fund may obtain short-term credits
necessary for the clearance of purchases and sales of
securities."
(i) To amend and make non-fundamental the Funds' fundamental investment policy
regarding pledging assets to read as follows:
"The Fund will not mortgage, pledge, or hypothecate
any of its assets, provided that this shall not apply
to the transfer of securities in connection with any
permissible borrowing or to collateral arrangements in
connection with permissible activities."
(j) To make non-fundamental the Fund's fundamental investment policy on
investing in restricted securities (TREASURY CASH SERIES ONLY).
(2) To eliminate the Funds' fundamental investment policy on selling securities
short.
(3) To approve amendments to the Company's Articles of Incorporation to permit
the Board of Directors to liquidate assets of a series or class without
seeking shareholder approval to the extent permitted under Maryland law.
III. The following actions were taken by the Board of Directors with regard to
non-fundamental investment policies:
(1) Approved the elimination of the following non-fundamental investment
limitations of the Funds:
(a) The Fund will not invest in securities of a company for the
purpose of exercising control or management; and
(b) The Fund will not invest in puts, calls, straddles, spreads, or
any combination of them.
(2) Approved revisions to the Fund's non-fundamental investment limitation
regarding restricted securities (GOVERNMENT CASH SERIES ONLY) to read
as follows:
"The Fund may invest in restricted securities.
Restricted securities are any securities in which the Fund
may invest pursuant to its investment objective and
policies but which are subject to restrictions on resale
under federal securities law. Under criteria established
by the Directors certain restricted securities are not
determined to be liquid the Fund will limit their
purchase, together with other liquid securities, to 10% of
its net assets."
(3) Approved revisions to the Funds' non-fundamental investment limitations to
read as follows:
"The Fund will not purchase securities for which there is
no readily available market, or enter into repurchase
agreements or purchase time deposits maturing in more than
seven days, if immediately after and as a result, the value
of such securities would exceed, in the aggregate, 10% of
the Fund's net assets."
(4) Approved the elimination of the following undertaking of the Funds:
"The Fund does not expect to borrow money or pledge
securities in excess of 5% of the value of its net assets during the coming
fiscal year."
(5) Approved the addition of a non-fundamental investment policy as
follows in applying the Funds' concentration restriction to the Funds:
"(a) utility companies will be divided according to their
services, for example, gas, gas transmission, electric and
telephone will each be considered a separate industry; (b)
financial service companies will be classified according to
the end users of their services, for example, automobile
finance, bank finance and diversified finance will each be
considered a separate industry; and (c) asset-backed
securities will be classified according to the underlying
assets securing such securities."
(6) Approved the elimination of the Funds' non-fundamental investment
policy pertaining to when-issued and delayed delivery transactions
that provides that the Fund will not engage in such transactions to an
extent that would cause the segregation of more than 20% of the value
of its total assets.
(7) Approved the addition of a non-fundamental investment policy (TREASURY
CASH SERIES ONLY) to read as follows:
"The Fund may engage in reverse repurchase agreements."
(8) Approved the addition of a non-fundamental policy that provides that
the Funds will pursue their investment objectives by investing in a
portfolio of money market securities maturing in 397 days or less.
June 30, 1999
Cusip 147551204
147551303
147551105
147551402
G02613-03 (7/99)
