THE U.S. GOVERNMENT SECURITIES FUND
THE STYLE MANAGER: LARGE CAP FUND
THE STYLE MANAGER FUND
THE VIRGINIA MUNICIPAL BOND FUND
THE MARYLAND MUNICIPAL BOND FUND
THE TREASURY MONEY MARKET FUND
THE MONEY MARKET FUND
THE TAX-FREE MONEY MARKET FUND
(collectively, the "Funds")
(Portfolios of The Virtus Funds)
Supplement to Prospectuses dated November 30, 1997
NOTICE TO SHAREHOLDERS:
1. In connection with the previously announced, proposed reorganization of
the above mentioned Funds and certain similarly managed funds that are
advised by affiliates of First Union Corporation, scheduled for February
27, 1998, you are being advised of the following changes:
It is expected that prior to the above-mentioned reorganization, Signet
Trust Company will merge with and into First Union National Bank ("FUNB"),
Charlotte, North Carolina, and FUNB will, therefore, replace Signet Trust
Company as custodian for the securities and cash of the Funds. Any
reference in your prospectus to Signet Trust Company or Signet Bank should
be deleted and replaced with "First Union National Bank."
Effective February 9, 1998, all references in your prospectus to Signet
Financial Services, Inc. ("SFSI") and Federated Shareholder Services
Company should be deleted and replaced with "Evergreen Service Company."
Accordingly, all references to SFSI's and Federated Shareholder Services
Company's mailing addresses should be deleted and replaced with "Evergreen
Service Company, PO Box 2121, Boston, MA 02106-2121."
Effective February 9, 1998, for all holders of Trust Shares of The U.S.
Government Securities Fund, The Style Manager: Large Cap Fund, The
Virginia Municipal Bond Fund, The Maryland Municipal Bond Fund, The
Treasury Money Market Fund and The Money Market Fund and Shares of The
Style Manager Fund and The Tax-Free Money Market Fund, all references in
the sections entitled "Investing in Shares" and "Redeeming Shares" to
Signet Trust Company should be deleted and replaced with "Investor
Services." Additionally, all references to phone numbers should be deleted
and replaced with "1-800-343-2898."
With respect to the "Investing in Shares," "Exchange Privilege,"
"Redeeming Shares" and "Other Classes of Shares" sections of your
prospectus, special care should be taken to incorporate this new address
and phone number where appropriate.
2. Effective November 28, 1997, all existing subsidiaries of Signet Banking
Corporation, includng Virtus Capital Management, Inc. ("VCM") became
subsidiaries of First Union Corporation. Please delete all references to
Signet Banking Corporation and replace them with "First Union
Corporation."
<PAGE>
Effective December 1997, John S. Hall and Tanya Orr Bird were replaced as
portfolio managers of The Virtus Funds by the persons described below, all
of whom currently also are employed as portfolio managers of affiliates of
First Union Corporation. Accordingly, please delete the biographical
information for John S. Hall and Tanya Orr Bird from the sections entitled
"Adviser's Background" in the Prospectuses and replace them with the
following:
"L. Robert Cheshire has managed The U.S. Government Securities Fund since
December 1997. Mr. Cheshire has served as a Vice President and Senior
Portfolio Manager of VCM since December 1997, and has also served as Vice
President and Senior Portfolio Manager of First Union National Bank ("First
Union") or its predecessor, Fidelity Bank since 1990. He is also head of
the Newark Taxable Fixed Income Unit and also manages the Evergreen
Intermediate Term Government Securities Fund. Prior to joining First Union,
Mr. Cheshire was a Vice President at Shearson Lehman Hutton for eleven
years in the Asset Management Division and Government Securities. He was
also Vice President of Government Securities for Charles E. Quincey and an
Assistant Vice President in the Municipal Securities Department with
Bankers Trust Co. in New York.
David C. Francis has co-managed The Style Manager: Large Cap Fund with John
E. Gray and Dillon S. Harris, Jr. since December 1997. Mr. Francis has
served as Chief Investment Officer of Virtus Capital Management, Inc since
December 1997 and has also served as a Senior Vice President of First Union
Capital Management Group since July 1994. Mr. Francis has over 20 years of
equity analysis and investment experience. He is also responsible for
directing the institutional asset management for the First Union Capital
Management Group. Mr. Francis joined First Union from Federated Investment
Counseling, a division of Federated Investors in Pittsburgh, Pennsylvania,
where he managed equities for employee benefit and tax-exempt separate
accounts and mutual funds.
John E. Gray has co-managed The Style Manager: Large Cap Fund with David C.
Francis and Dillon S. Harris, Jr. since December 1997. Mr. Gray has served
as a Vice President and Senior Portfolio Manager for VCM since December
1997, and has also served as Vice President and Senior Portfolio Manager at
First Union since 1989. Mr. Gray has over 20 years of investment experience
including employment in the public, corporate and private sectors. He was
the investment officer for the Utah State Retirement Fund. He was Vice
President of E. F. Hutton Asset Management and has been associated with
Registered Investment Advisors such as Capital Consultants of Portland,
Oregon. Prior to joining First Union in 1992, Mr. Gray was Chief Investment
Officer of Dominion Trust Company. Mr. Gray received his B.A. in Political
Science from Davidson College and his M.B.A. concentrating in Finance from
the University of Texas.
<PAGE>
Dillon S. Harris, Jr. has co-managed The Style Manager: Large Cap Fund with
David C. Francis and John E. Gray since December 1997. Mr. Harris has
served as a Vice President and Senior Portfolio Manager for VCM and is also
a Vice President and Portfolio Manager at First Union. Mr. Harris joined
First Union in 1989 and has 12 years of experience. He is responsible for
the management of separately managed employee benefit and endowment
accounts. Prior to joining First Union, Mr. Harris was a portfolio manager
with Mellon Bank in Philadelphia, Pennsylvania. Mr. Harris received his
B.A. in Business Management/Economics from North Carolina State University
and his M.B.A. concentrating in Finance/Investments from Indiana
University. He is a Chartered Financial Analyst and a member of the
Association for Investment Management and Research and the North Carolina
Society of Financial Analysts.
Stephen A. Lieber has co-managed The Style Manager Fund with Gary R.
Buesser since December 1997. Mr. Lieber has served as a Portfolio Manager
for VCM since December 1997 and is also currently Chairman and Co-Chief
Executive Officer of Lieber & Co. and Evergreen Asset Management Corp.,
both of which are subsidiaries of First Union Banking Corp. He was the
founding partner of Lieber & Co. in 1969 and served as Senior Partner until
June 1994. He is portfolio manager of the Evergreen Fund, Evergreen
Foundation Fund, Evergreen Tax Strategic Foundation Fund and Global Leaders
Fund. He was a founding General Partner of Vanden Broeck, Lieber & Co. from
1956 to 1969. He has been a guest lecturer at the Investment Banking
Association Annual Wharton School Seminars, the New School for Social
Research, and New York University School of Commerce. Mr. Lieber received
his B.A. from Williams College in 1946, and was in a Doctoral Program at
Harvard University Graduate School of Arts and Sciences until 1948. He is a
member of The New York Society of Security Analysts and the Association for
Investment Management and Research.
Gary R. Buesser has co-managed The Style Manager Fund with Stephen A.
Lieber since December 1997. Mr. Buesser has served as a Portfolio Manager
for VCM since December 1997 and has also served as an analyst with Lieber &
Co. since 1996. Previously, he was a Portfolio Manager/Analyst with Cowen
Asset Management and Shearson Lehman Brothers. He started his career with
Kidder Peabody in its equity trading department. Mr. Buesser received his
B.S. in Economics from St. Peter's College in 1981 and an M.B.A.
concentrating in Finance from the College of William and Mary in 1993. He
is a member of the New York Society of Security Analysts and the
Association for Investment Management and Research.
Charles E. Jeanne has managed The Maryland Municipal Bond Fund and The
Virginia Municipal Bond Fund since December 1997. Mr. Jeanne has served as
a Portfolio Manager for VCM since December 1997, and has also served as a
Portfolio Manager of First Union Capital Management Group since 1991. Mr.
Jeanne graduated in 1986 from Ohio Wesleyan University, receiving a B.A.
He is also a member of AIMR, North Carolina Financial Analyst Society and
a CFA level I candidate. Mr. Jeanne has over 7 years of banking and
investment experience. He is responsible for the management of the
Evergreen Virginia Municipal Bond Fund, the Virginia Tax Exempt Bond Fund,
and a number of short-term accounts totaling over $172 million in assets.
<PAGE>
J. Kellie Allen has managed The Treasury Money Market Fund and The Money
Market Fund since December 1997. Ms. Allen has served as a Portfolio
Manager for VCM since December 1997, and has also served as a Portfolio
Manager of First Union since 1987. Ms. Allen has over 11 years of
investment experience. She is manager of three money market and short-term
funds as well as several separately managed accounts and has
responsibility for a total of $2.4 billion in assets. Ms. Allen started at
First Union as an equity trader in 1986. Prior to joining First Union, she
worked as an equity trader for First Tennessee Bank in Memphis, Tennessee.
Steven C. Shachat has managed The Tax-Free Money Market Fund since December
1997. Mr. Shachat has served as a Portfolio Manager for VCM since December
1997 and has also served as a Portfolio Manager of Lieber & Co. since 1988.
Mr. Shachat joined Lieber & Co. in 1988 and has been managing short-term
tax exempt investments. He is portfolio manager of the Evergreen Tax-Exempt
Money Market Fund and the Evergreen Short-Intermediate Municipal Fund.
Prior to joining Lieber & Co., Mr. Shachat was employed by Mitchell
Hutchins Asset Management, Inc., a subsidiary of Paine Webber Inc., as a
portfolio manager of the Paine Webber Resource Management Account Tax-Free
Fund. His previous experience was with Donald Sheldon & Co., a firm
specializing in tax-exempt securities. Mr. Shachat earned a B.S. degree
from Boston University."
December 31, 1997
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THE U.S. GOVERNMENT SECURITIES FUND
THE STYLE MANAGER: LARGE CAP FUND
THE STYLE MANAGER FUND
THE VIRGINIA MUNICIPAL BOND FUND
THE MARYLAND MUNICIPAL BOND FUND
THE TREASURY MONEY MARKET FUND
THE MONEY MARKET FUND
THE TAX-FREE MONEY MARKET FUND
(collectively, the "Funds")
(Portfolios of The Virtus Funds)
Supplement to Statement of Additional Information dated November 30, 1997
NOTICE TO SHAREHOLDERS:
It is expected that prior to the reorganization of the above-mentioned Funds,
Signet Trust Company will merge with and into First Union National Bank
("FUNB"), Charlotte, North Carolina, and FUNB will, therefore, replace Signet
Trust Company as custodian for the securities and cash of the Funds.
Accordingly, please delete all references to Signet Trust Company and replace
them with "First Union National Bank."
Effective February 9, 1998, Evergreen Service Company, Boston, Massachusetts,
will replace Federated Shareholder Services Company as Transfer Agent and
Dividend Disbursing Agent for the Funds. Accordingly, please delete all
references to Federated Shareholder Services Company and replace them with
"Evergreen Service Company."
Effective November 28, 1997, all existing subsidiaries of Signet Banking
Corporation, includng Virtus Capital Management, Inc. ("VCM"), became
subsidiaries of First Union Corporation. Accordingly, delete any reference to
Signet Banking Corporation and replace it with "First Union Corporation."
Effective February 9, 1998, please delete the last sentence of the section
entitled "Financial Statements" in your Statement of Additional Information and
replace it with the following:
"A copy of the Annual Report may be obtained without charge by contacting
Evergreen Service Company at 1-800-343-2898."
December 31, 1997
