NORTH CAROLINA MUNICIPAL CASH TRUST
(A PORTFOLIO OF FEDERATED MUNICIPAL TRUST)
Supplement to Prospectus dated February 28, 1995
Senate Bill 8, ratified by the General Assembly of North Carolina in its
1995 session, repealed the North Carolina Intangible Personal Property Tax.
1. On the Cover Page, please delete the last sentence of the first
paragraph, which reads as follows:
"In addition, the Fund intends to qualify as an investment
substantially exempt from the North Carolina Intangible Personal
Property Tax."
2. Under the section entitled "Investment Objective" on page 3, please
delete the second sentence, which reads as follows:
"In addition, the Fund intends to qualify as an investment
substantially exempt from the North Carolina Intangible Personal
Property Tax."
3. Under the section entitled "Investment Policies" on page 3, please
delete the second sentence and replace with the following:
"As a matter of investment policy, which cannot be changed
without shareholder approval, at least 80% of the Fund's annual
interest income will be exempt from federal regular income tax
and North Carolina state income tax or at least 80% of its net
assets will be invested in obligations, the interest income from
which is exempt from federal regular and North Carolina state
income taxes."
4. Under the sub-section entitled "Acceptable Investments." on page 3,
please delete the first sentence and replace with the following:
"The Fund invests primarily in debt obligations issued by or on
behalf of North Carolina and its political subdivisions and
financing authorities, and obligations of other states,
territories, and possessions of the United States, including the
District of Columbia, and any political subdivision or financing
authority of any of these, the income from which is, in the
opinion of qualified legal counsel, exempt from federal regular
income tax and North Carolina income tax ("North Carolina
municipal securities").
5. Under the sub-section entitled "North Carolina Taxes." on page 14,
please delete the second paragraph.
June 26, 1995
FEDERATED SECURITIES CORP.
Distributor
A subsidiary of Federated Investors
Federated Investors Tower
Pittsburgh, PA 15222-3779
314229782
G01229-01 (6/95)
