THE WACHOVIA FUNDS
Class A Shares
CLASS B SHARES
--------------------------------------------------------------------------------
Supplement to the Combined Prospectus dated January 31, 2000
I. NEW SHARE CLASSES
A. Effective December 9, 2000, Class B Shares will be offered for the following
funds:
THE WACHOVIA FUNDS
Wachovia Growth & Income Fund
Wachovia Equity Index Fund
Wachovia Emerging Markets Fund
Wachovia Personal Equity Fund
Wachovia Intermediate Fixed Income Fund
Wachovia Short-Term Fixed Income Fund
and Class C Shares will be offered for the following funds:
THE WACHOVIA FUNDS
Wachovia Equity Fund Wachovia Quantitative Equity Fund Wachovia Special Values
Fund Wachovia Balanced Fund Wachovia Fixed Income Fund Wachovia Growth & Income
Fund Wachovia Equity Index Fund Wachovia Emerging Markets Fund Wachovia Personal
Equity Fund Wachovia Intermediate Fixed Income Fund Wachovia Short-Term Fixed
Income Fund.
Accordingly, the following fee tables reflect the addition of these share
classes to the above funds:
WHAT ARE THE FUNDS' FEES AND EXPENSES?
These tables describe the fees and expenses that you may pay if you buy and hold
shares of the Funds' CLASS B SHARES.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
GROWTH & EQUITY EMERGING
SHAREHOLDER FEES INCOME INDEX MARKETS
FEES PAID DIRECTLY FROM YOUR INVESTMENT FUND FUND FUND
---------------------------------------------------------------------------------------
Maximum Sales Charge (Load) Imposed on Purchases None None None
( as a percentage of offering price)
---------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load) (as a percentage 5.00% 5.00% 5.00%
original
purchase price or redemption proceeds, as applicable)
---------------------------------------------------------------------------------------
Maximum Sales Charge (Load) Imposed on Reinvested DiviNones None None
(and other Distributions) (as a percentage of offering price
---------------------------------------------------------------------------------------
Redemption Fee (as a percentage of amount redeemed, ifNone None None
applicable)
---------------------------------------------------------------------------------------
---------------------------------------------------
Exchange Fee None None None
---------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES (1)
EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS (AS A PERCENTAGE OF AVERAGE NET ASSETS)
Management Fee 0.70% 0.30% 1.00%
---------------------------------------------------------------------------------------
Distribution (12b-1) Fee 0.75% 0.75% 0.75%
---------------------------------------------------------------------------------------
Shareholder Services Fee 0.25% 0.25% 0.25%
---------------------------------------------------------------------------------------
Other Expenses 0.14% 0.14% 0.35%
---------------------------------------------------------------------------------------
Total Annual Class B Shares Operating Expenses (Be ore1.84% 1.44% 2.35%
Waiver) 1
---------------------------------------------------------------------------------------
Total Annual Fund Operating Expenses (After Waiver) 1.84% 1.44% 2.35%
---------------------------------------------------------------------------------------
INTERMEDIATE
PERSONAL FIXED SHORT-TERM
SHAREHOLDER FEES EQUITY INCOME FIXED INCOME
FEES PAID DIRECTLY FROM YOUR INVESTMENT FUND FUND FUND
--------------------------------------------------------------- ---------- -----------
Maximum Sales Charge (Load) Imposed on Purchases None None None
( as a percentage of offering price)
--------------------------------------------------------------- ----------------------
Maximum Deferred Sales Charge (Load) (as a percentage 5.00% 5.00% 5.00%
original purchase price or redemption proceeds, as
applicable)
--------------------------------------------------------------- ----------------------
Maximum Sales Charge (Load) Imposed on Reinvested DiviNones None None
(and other Distributions) (as a percentage of offering price
--------------------------------------------------------------- ----------------------
Redemption Fee (as a percentage of amount redeemed, ifNone None None
applicable)
--------------------------------------------------------------- ----------------------
---------------------------------------------------
Exchange Fee None None None
--------------------------------------------------------------- ----------------------
ANNUAL FUND OPERATING EXPENSES (1)
EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS (AS A PERCENTAGE OF AVERAGE NET ASSETS)
Management Fee 0.70% 0.60% 0.55%
--------------------------------------------------------------- ----------------------
Distribution (12b-1) Fee 0.75% 0.75% 0.75%
--------------------------------------------------------------- ----------------------
Shareholder Services Fee 0.25% 0.25% 0.25%
--------------------------------------------------------------- ----------------------
Other Expenses 0.21% 0.18% 0.22%
--------------------------------------------------------------- ----------------------
Total Annual Class B Shares Operating Expenses (Befor1.91% 1.78% 1.77%
Waiver) 1
--------------------------------------------------------------- ----------------------
Waiver of Fund Expenses 0.01% 0.04% 0.14%
--------------------------------------------------------------- ----------------------
Total Annual Fund Operating Expenses (After Waiver) 1.90% 1.74% 1.63%
--------------------------------------------------------------- ----------------------
</TABLE>
(1) Pursuant to an agreement between the Adviser and the Trust, the Adviser
agrees during the period from December 15, 1998 through January 31, 2002 to
waive its fees, and/or make reimbursements to the Funds, so that each Fund's net
operating expenses do not exceed, in the aggregate, the Fund's Total Actual
Annual Operating Expenses listed above. The Adviser agrees that this obligation
shall constitute a contractual commitment enforceable by the Trust and that the
Adviser shall not assert any right to reimbursement of amounts so waived or
reimbursed.
EXAMPLE
The following Example is intended to help you compare the cost of investing in
each Fund's Class B Shares with the cost of investing in other mutual funds. The
Example assumes that you invest $10,000 in each Fund's Class B Shares for the
time periods indicated and then redeem all of your Shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year
and that each Fund's operating expenses are based upon the current expense
limitation as shown above in the table. Although your actual costs may be higher
or lower, based on these assumptions your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
GROWTH & INCOME FUND
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming redemption $687 $879 $1,196 $1,962
-------------------------------------------------------------------------------
Expenses assuming no redemption $187 $579 $996 $1,962
-------------------------------------------------------------------------------
---------------------------------
EQUITY INDEX FUND
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming redemption $647 $756 $987 $1,520
-------------------------------------------------------------------------------
Expenses assuming no redemption $147 $456 $787 $1,520
-------------------------------------------------------------------------------
---------------------------------
EMERGING MARKETS FUND
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming redemption $738 $1,033 $1,455 $2,499
-------------------------------------------------------------------------------
Expenses assuming no redemption $238 $733 $1,255 $2,499
-------------------------------------------------------------------------------
---------------------------------
PERSONAL EQUITY FUND
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming redemption $693 $897 $1,226 $2,027
-------------------------------------------------------------------------------
Expenses assuming no redemption $193 $597 $1,026 $2,027
-------------------------------------------------------------------------------
---------------------------------
INTERMEDIATE FIXED INCOME FUND
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming redemption $677 $848 $1,144 $1,853
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming no redemption $177 $548 $944 $1,853
-------------------------------------------------------------------------------
---------------------------------
SHORT-TERM FIXED INCOME FUND
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming redemption $666 $814 $1,087 $1,732
-------------------------------------------------------------------------------
---------------------------------
Expenses assuming no redemption $166 $514 $887 $1,732
-------------------------------------------------------------------------------
WHAT ARE THE FUNDS' FEES AND EXPENSES?
These tables describe the fees and expenses that you may pay if you buy and hold
shares of the Funds' CLASS C SHARES.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
QUANTITATIVE GROWTH & EQUITY SPECIAL EMERGING
SHAREHOLDER FEES EQUITY EQUITY INCOME INDEX VALUES MARKETS
FEES PAID DIRECTLY FROM YOUR FUND FUND FUND FUND FUND FUND
INVESTMENT
---------------------------------------------------------------------------------------
Maximum Sales Charge (Load) Imposed 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
on
Purchases ( as a percentage of
offering price)
---------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load) 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
(as a
percentage of original purchase
price or redemption
proceeds, as applicable)
---------------------------------------------------------------------------------------
Maximum Sales Charge (Load) Imposed None None None None None None
on
Reinvested Dividends (and other
Distributions)
(as a percentage of offering price
---------------------------------------------------------------------------------------
Redemption Fee (as a percentage of None None None None None None
amount
redeemed, if applicable)
---------------------------------------------------------------------------------------
--------------------------------------
Exchange Fee None None None None None None
---------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES (1)
EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS (AS A PERCENTAGE OF AVERAGE NET ASSETS)
Management Fee 0.70% 0.70% 0.70% 0.30% 0.80% 1.00%
---------------------------------------------------------------------------------------
Distribution (12b-1) Fee 0.75% 0.75% 0.75% 0.75% 0.75% 0.75%
---------------------------------------------------------------------------------------
Shareholder Services Fee 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
---------------------------------------------------------------------------------------
Other Expenses 0.14% 0.16% 0.14% 0.14% 0.18% 0.35%
---------------------------------------------------------------------------------------
Total Annual Class C Shares 1.84% 1.86% 1.84% 1.44% 1.98% 2.35%
Operating
Expenses (Before Waiver) 1
---------------------------------------------------------------------------------------
Total Annual Fund Operating Expenses 1.84% 1.86% 1.84% 1.44% 1.98% 2.35%
(After Waiver)
---------------------------------------------------------------------------------------
INTERMEDIATE
PERSONAL FIXED FIXED SHORT-TERM
SHAREHOLDER FEES EQUITY BALANCED INCOME INCOME FIXED INCOME
FEES PAID DIRECTLY FROM YOUR FUND FUND FUND FUND FUND
INVESTMENT
---------------------------------------------------------------------- -------------
Maximum Sales Charge (Load) 1.00% 1.00% 1.00% 1.00% 1.00%
Imposed on
purchases ( as a percentage of
offering price)
------------------------------------------------------------------------------------
Maximum Deferred Sales Charge 1.00% 1.00% 1.00% 1.00% 1.00%
(Load)
(as a percentage of original
purchase price
or redemption proceeds, as
applicable)
------------------------------------------------------------------------------------
Maximum Sales Charge (Load) None None None None None
Imposed
on Reinvested Dividends (and
other
Distributions) (as a percentage
of offering price
------------------------------------------------------------------------------------
Redemption Fee (as a percentage None None None None None
of amount
redeemed, if applicable)
------------------------------------------------------------------------------------
----------------------------------
Exchange Fee None None None None None
------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES (1)
EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS (AS A PERCENTAGE OF AVERAGE NET ASSETS)
Management Fee 0.70% 0.70% 0.60% 0.60% 0.55%
------------------------------------------------------------------------------------
Distribution (12b-1) Fee 0.75% 0.75% 0.75% 0.75% 0.75%
------------------------------------------------------------------------------------
Shareholder Services Fee 0.25% 0.25% 0.25% 0.25% 0.25%
------------------------------------------------------------------------------------
Other Expenses 0.21% 0.14% 0.15% 0.18% 0.22%
------------------------------------------------------------------------------------
Total Annual Class C Shares 1.91% 1.84% 1.75% 1.78% 1.77%
Operating
Expenses (Before Waiver) 1
------------------------------------------------------------------------------------
Waiver of Fund Expenses 0.01% 0.08% 0.03% 0.04% 0.14%
------------------------------------------------------------------------------------
Total Annual Fund Operating 1.90% 1.76% 1.72% 1.74% 1.63%
Expenses
(After Waiver)
------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to an agreement between the Adviser and the Trust, the Adviser
agrees during the period from December 15, 1998 through January 31, 2002 to
waive its fees, and/or make reimbursements to the Funds, so that each Fund's net
operating expenses do not exceed, in the aggregate, the Fund's Total Actual
Annual Operating Expenses listed above. The Adviser agrees that this obligation
shall constitute a contractual commitment enforceable by the Trust and that the
Adviser shall not assert any right to reimbursement of amounts so waived or
reimbursed.
Example
The following Example is intended to help you compare the cost of investing in
each Fund's Class C Shares with the cost of investing in other mutual funds. The
Example assumes that you invest $10,000 in each Fund's Class C Shares for the
time periods indicated and then redeem all of your Shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year
and that each Fund's operating expenses are based upon the current expense
limitation as shown above in the table. Although your actual costs may be higher
or lower, based on these assumptions your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
---------------------------------------------------------------------------
EQUITY FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $385 $673 $1,086 $2,237
redemption
---------------------------------------------------------------------------
Expenses assuming no $285 $673 $1,086 $2,237
redemption
---------------------------------------------------------------------------
----------------------------
QUANTITATIVE EQUITY FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $387 $679 $1,096 $2,258
redemption
---------------------------------------------------------------------------
Expenses assuming no $287 $679 $1,096 $2,258
redemption
---------------------------------------------------------------------------
----------------------------
GROWTH & INCOME FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $385 $673 $1,086 $2,237
redemption
---------------------------------------------------------------------------
Expenses assuming no $285 $673 $1,086 $2,237
redemption
---------------------------------------------------------------------------
----------------------------
EQUITY INDEX FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $345 $551 $879 $1,807
redemption
---------------------------------------------------------------------------
Expenses assuming no $245 $551 $879 $1,807
redemption
---------------------------------------------------------------------------
----------------------------
SPECIAL VALUES FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $399 $715 $1,157 $2,383
redemption
---------------------------------------------------------------------------
Expenses assuming no $299 $715 $1,157 $2,383
redemption
---------------------------------------------------------------------------
----------------------------
EMERGING MARKETS FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $436 $826 $1,343 $2,759
redemption
---------------------------------------------------------------------------
Expenses assuming no $336 $826 $1,343 $2,759
redemption
---------------------------------------------------------------------------
----------------------------
PERSONAL EQUITY FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $391 $691 $1,116 $2,300
redemption
---------------------------------------------------------------------------
Expenses assuming no $291 $691 $1,116 $2,300
redemption
---------------------------------------------------------------------------
----------------------------
BALANCED FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $377 $649 $1,045 $2,152
redemption
---------------------------------------------------------------------------
Expenses assuming no $277 $649 $1,045 $2,152
redemption
---------------------------------------------------------------------------
----------------------------
FIXED INCOME FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $373 $636 $1,024 $2,110
redemption
---------------------------------------------------------------------------
----------------------------
Expenses assuming no $273 $636 $1,024 $2,110
redemption
---------------------------------------------------------------------------
----------------------------
INTERMEDIATE FIXED INCOME
FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $375 $643 $1,034 $2,131
redemption
---------------------------------------------------------------------------
----------------------------
Expenses assuming no $275 $643 $1,034 $2,131
redemption
---------------------------------------------------------------------------
----------------------------
SHORT-TERM FIXED INCOME
FUND
---------------------------------------------------------------------------
----------------------------
Expenses assuming $364 $609 $978 $2,013
redemption
---------------------------------------------------------------------------
----------------------------
Expenses assuming no $264 $609 $978 $2,013
redemption
---------------------------------------------------------------------------
B. Because of the addition of Class C Shares, please add the following
sub-sections to the section entitled, "What Do Shares Cost?":
"SALES CHARGE WHEN YOU PURCHASE AND REDEEM-CLASS C SHARES
Class C Shares are sold at their NAV next determined after an order is received,
plus a front-end sales charge of 1.00%. If you redeem Class C Shares within one
year of the purchase date, you will be charged a 1.00% contingent deferred sales
charge.
C. Also, please replace the section entitled "How are the Funds Sold?" with the
following:
"HOW ARE THE FUNDS SOLD?
Each Fund (except the Municipal Funds) offers four share classes: Class A
Shares, Class B Shares, Class C Shares and Class Y Shares, each representing
interests in a single portfolio of securities. The Municipal Funds offer two
classes of shares: Class A Shares and Class Y Shares.
This prospectus relates only to Class A Shares, Class B Shares, and Class C
Shares. Each share class has different sales charges and other expenses, which
affect their performance. Contact your investment professional or call
1-800-341-7400 for more information concerning the other classes.
The Fund's Distributor, Federated Securities Corp., markets the Shares described
in this prospectus to institutions or individuals, directly or through an
investment professional that has an agreement with the Distributor (Authorized
Dealer). When the Distributor receives marketing fees and sales charges, it may
pay some or all of them to investment professionals. The Distributor and its
affiliates may pay out of their assets other amounts (including items of
material value) to investment professionals for marketing and servicing
Shares.The Distributor is a subsidiary of Federated Investors, Inc. (Federated).
RULE 12B-1 PLAN
Each of the Equity Fund, Quantitative Equity Fund, Special Values Fund, Balanced
Fund, Fixed Income Fund, Growth & Income Fund, Equity Index Fund, Emerging
Markets Fund, Personal Equity Fund, Intermediate Fixed Income Fund, and
Short-Term Fixed Income Fund has adopted a Rule 12b-1 Plan, which allows it to
pay marketing fees to the Distributor and investment professionals for the sale,
distribution and customer servicing of the Fund's Class B Shares and Class C
Shares at an annual rate of up to 0.75% of the average daily NAV of the Fund's
Class B Shares and Class C Shares. Because these Shares pay marketing fees on an
ongoing basis, your investment cost may be higher over time than other shares
with different sales charges and marketing fees."
II. PORTFOLIO MANAGER CHANGES
On page 27 of the Prospectus, please delete the biography of Paige C. Henderson
(Emerging Markets Fund) and replace it with the following biography of Jasbeena:
"Jasbeena is a vice president with Wachovia Asset Management, serving as
co-manager of the Wachovia Emerging Markets Fund with specific responsibility
for Asia equities since July 2000. Prior to joining Wachovia Asset Management in
July 2000, Ms. Jasbeena was a research analyst for RT Investment Counsel Inc.,
beginning in 1994. Ms. Jasbeena received a bachelor's degree in Economics from
York University. She has over seven years of investment experience and is a
member of the Association of Investment Management and Research." In
addition, please delete the following biographies:
1. Jerry D. Burton (Quantitative Equity Fund)
2. J. Wesley Jordan (Emerging Markets Fund)
3. George E. McCall (Quantitative Equity Fund)
4. Michael O. Mercer (Equity Fund, Balanced Fund, Growth & Income Fund, and
Personal Equity Fund)
Finally, the following individuals now manage the Quantitative Equity Fund:
1. Daniel S. Earthman
2. John F. Hageman
3. Russell L. Kimbro, Jr.
4. F. Stanley King
5. Matthew J. McGuinness
Their biographies can be found on page 27 of the Prospectus.
December 9, 2000
Cusips 929901734 929901676
929901742 929901767
929901809 929901601
929901882 929901627
929901841 929901650
929901635 929901866
929901692 929901783
929901718 929901791
25894 (12/00)
