RIGGS FUNDS
Riggs Prime Money Market Fund
Riggs Small Company Stock Fund
Riggs Stock Fund
Riggs U.S. Government Securities Fund
Riggs U.S. Treasury Money Market Fund
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Supplement to Combined Prospectuses and Combined Statement of Additional
Information, as appropriate, dated June 30, 1998
I. At the June 15, 1999 shareholder meeting, shareholders approved the following
change:
Elected seven Trustees.
II. At the June 15, 1999 shareholder meeting, shareholders of all the Funds
except the Riggs U.S. Treasury Money Market Fund approved the following changes
to the Funds' fundamental investment policies. The meeting was adjourned with
respect to proposals to change the fundamental investment policies of Riggs U.S.
Treasury Money Market Fund. The meeting reconvened on June 30, 1999, at which
time shareholders approved the following changes to the Riggs U.S. Treasury
Money Market Fund's fundamental investment policies.
a. Amended the Funds' fundamental investment policies regarding
diversification 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. Amended the Funds' fundamental investment policies 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."
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c. Amended the Funds' fundamental investment policies regarding
investments in real estate 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. Amended the Funds' fundamental investment policies 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. As a non-fundamental operating policy, for purposes of
the foregoing policy, investments in transactions involving futures
contracts and options, forward currency contracts, swap transactions
and other financial contracts that settle by payment of cash are not
deemed to be investments in commodities."
e. Amended 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. Amended the Funds' fundamental investment policies regarding lending
by the Funds 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."
<PAGE>
g.Amended the Funds' fundamental investment policies regarding
concentration of the Funds' 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 so long as the policy of the SEC remains
in effect. As a non-fundamental operating policy, the Fund will
consider concentration to be the investment of more than 25% of the
value of its total assets in any one industry."
h. Made non-fundamental, and amended, the Funds' fundamental investment
policies regarding buying securities on margin to read as follows:
SMALL COMPANY FUND, STOCK FUND AND GOVERNMENT FUND:
"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, and further provided that the Fund
may make margin deposits in connection with its use of financial
options and futures, forward and spot currency contracts, swap
transactions and other financial contracts or derivative instruments."
PRIME FUND AND TREASURY FUND:
"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. Made non-fundamental, and amended, the Funds' fundamental investment
policies 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. Removed the Funds' fundamental investment policies on selling
securities short.
k. Removed the Funds' fundamental investment policies on investments in
restricted securities (PRIME FUND, SMALL COMPANY FUND, STOCK FUND AND GOVERNMENT
FUND ONLY).
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III. The following actions were taken by the Board of Trustees with regard to
non-fundamental investment policies:
1. Approved the deletion of the Funds' non-fundamental investment
policies that prohibit entering into transactions for the purpose of engaging in
arbitrage.
2.Approved the deletion of the Funds' non-fundamental investment
policies that prohibit purchasing put or call options on securities or
on futures contracts (PRIME FUND AND TREASURY FUND ONLY).
3.Approved the deletion of the Funds' non-fundamental investment
policies regarding prohibition against purchasing put or call options
on securities or on futures contracts, except that the Funds' may
engage in put and call options, futures and options on futures (SMALL
COMPANY FUND, STOCK FUND AND GOVERNMENT FUND ONLY).
4.Approved the deletion of the Funds' non-fundamental investment
policies that prohibit purchasing securities of a company for the
purpose of exercising control or management.
5. Approved the deletion of the Funds' non-fundamental investment
policies that prohibit investing in warrants.
6. (i) Amended the Funds' non-fundamental investment policies regarding
illiquid securities to read as follows:
PRIME FUND:
"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."
SMALL COMPANY FUND, STOCK FUND AND GOVERNMENT FUND:
"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, 15% of the Fund's net assets."
(ii) Approved the addition of a non-fundamental investment policy
pertaining to illiquid securities on behalf of the TREASURY FUND to read as
follows:
TREASURY FUND:
"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."
<PAGE>
7. Amended the Funds' non-fundamental investment policies regarding
investment in other investment companies to read as follows:
"The Fund may invest its assets in securities of other investment
companies."
8. Amended the Funds' non-fundamental investment policies regarding
investing in cash and cash items to read as follows:
"The Fund may invest temporarily in cash and cash items during times
of unusual market conditions for defensive purposes and to maintain
liquidity. Cash items may include short-term obligations of the U.S.
government or its agencies or instrumentalities and repurchase
agreements." (SMALL COMPANY FUND, STOCK FUND AND GOVERNMENT FUND ONLY)
9. Approved the deletion of the Funds' undertakings to have no present
intention to borrow money or pledge securities in excess of 5% of the value of
its net assets.
10.Approved the addition of a non-fundamental investment policy as follows:
"In applying to the Funds' concentration restriction: (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."
11.Approved the addition of a non-fundamental operating policy that
provides that the PRIME MONEY MARKET FUND ONLY shall invest
exclusively in a portfolio of money market instruments maturing in 397
days or less.
12.Approved the addition of a non-fundamental investment policy that
provides that the TREASURY FUND ONLY shall invest only in U.S.
Treasury obligations maturing in 397 days or less and in repurchase
agreements fully collateralized by U.S. Treasury obligations.
13.Approved the deletion of the Funds' non-fundamental investment
policies pertaining to when-issued and delayed delivery transactions
that provide that each of the Funds 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.
June 30, 1999
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Federated Securities Corp., Distributor
Cusip 76656A203 Cusip 76656A104 Cusip 76656A807 Cusip 76656A880 Cusip 76656A609
Cusip 76656A708 Cusip 76656A500 Cusip 76656A401 Cusip 76656A302 G02646-03 (6/99)
