FILED PURSUANT TO RULE 497(e)
REGISTRATION FILE NO. 33-34080
March 9, 1999
ISG FUNDS
SUPPLEMENT TO PROSPECTUS
DATED NOVEMBER 9, 1998
AS REVISED, DECEMBER 14, 1998
THE FOLLOWING SUPERSEDES ANY CONTRARY INFORMATION CONTAINED IN THE PROSPECTUS
UNDER THE CAPTION "MANAGEMENT OF THE FUNDS--INVESTMENT ADVISER." UNLESS
OTHERWISE INDICATED BELOW, THE PRIMARY PORTFOLIO MANAGER FOR A FUND IS THE
PERSON NAMED IN THE PROSPECTUS.
The primary portfolio manager for each indicated Fund is as follows:
EQUITY INCOME FUND--Robert A. Rinner. Mr. Rinner has been a primary portfolio
manager of the Equity Income Fund since its inception, and has been a portfolio
manager with the Adviser since April 1996. Prior thereto, Mr. Rinner was a
portfolio manager with Royal Insurance Co.
LIMITED TERM U.S. GOVERNMENT FUND--John Mark McKenzie. Mr. McKenzie has been a
portfolio manager of the Limited Term U.S. Government Fund since May 1998 and
the Fund's primary portfolio manager since December 1998. Mr. McKenzie has been
employed by the Adviser since May 1998 and by Deposit Guaranty National Bank
since 1984.
MUNICIPAL INCOME FUND--Sharon S. Brown. Ms. Brown has been a primary portfolio
manager of the Municipal Income Fund since its inception, and has been a Trust
Officer of the Adviser since 1988.
* * *
THE FOLLOWING SUPPLEMENTS AND SUPERSEDES ANY CONTRARY INFORMATION CONTAINED IN
THE PROSPECTUS UNDER THE CAPTION "HOW TO REDEEM SHARES--CONTINGENT DEFERRED
SALES CHARGE--CLASS B SHARES." THE RATE AND TIME PERIODS FOR THE CDSC REMAIN THE
SAME.
CONTINGENT DEFERRED SALES CHARGE--CLASS B SHARES. If a shareholder redeems Class
B Shares prior to the sixth anniversary of purchase, the shareholder will pay a
CDSC at the rates set forth herein. The CDSC is assessed on an amount equal to
the lesser of the then-current market value or the cost of the Class B Shares
being redeemed. Accordingly, no sales charge is imposed on increases in net
asset value above the initial purchase price. In addition, no charge is assessed
on Class B Shares derived from reinvestment of dividends or capital gain
distributions.
The amount of CDSC, if any, varies depending on the number of years from the
time of payment for the purchase of Class B Shares until the time of redemption
of such shares. Solely for purposes of determining the number of years from the
time of any payment for the purchase of Class B Shares, all payments during a
month are aggregated and deemed to have been made on the first day of the month.
When an investor redeems his or her Class B Shares, the redemption order is
processed so as to minimize the amount of the CDSC that will be charged. Class B
Shares that are not subject to the CDSC (i.e., Class B Shares that were acquired
through reinvestment of dividends or capital gain distributions) are redeemed
first and after that Class B Shares that have been held the longest are
redeemed.
To provide an example, assume you purchased 100 Class B Shares at $10 per share
(a total cost of $1,000) and prior to the second anniversary after purchase, the
net asset value per share is $12 and during such time you have acquired 10
additional Class B Shares through dividends reinvested in Class B Shares. If you
then make your first redemption of 50 Class B Shares (proceeds of $600), the
first 10 Class B Shares will not be subject to the CDSC because you received
them as dividends. With respect to the remaining 40 Class B Shares, the CDSC is
applied only to the original cost of $10 per share and not to the increase in
net asset value of $2 per share. Therefore, $400 of the $600 redemption proceeds
is subject to a CDSC at a rate of 3.00% (the applicable rate prior to the second
anniversary after purchase).
BISYS compensates certain Service Organizations for selling Class B Shares at
the time of purchase from BISYS' own assets. The proceeds of the CDSC and
distribution fee, in part, are used to defray these expenses.
