MENTOR FUNDS
SUPPLEMENT
TO PROSPECTUS DATED NOVEMBER 29, 1996
Mentor Investment Group, LLC, the Portfolios' administrator ("Mentor"), has
informed Mentor Funds that Wheat First Butcher Singer, Inc., Mentor's parent
company, will be acquired by First Union Corp. ("First Union"), in a transaction
expected to occur as early as December of this year. First Union is a global
financial services company with approximately $140 billion in assets and $10
billion in total stockholders' equity. The proposed arrangement does not
contemplate any changes in the management or operations of Mentor or any of its
subsidiaries, including Mentor Investment Advisors, LLC and Mentor Perpetual
Advisors, LLC, the Portfolios' investment advisers. Consummation of the
acquisition, which is subject to a number of conditions, including regulatory
approvals, will result in the termination of the administration agreement
between the Portfolios and Mentor and the investment advisory agreements
between the Portfolios and their investment advisers. It is expected that the
Trustees of Mentor Funds will meet to consider a new administration agreement
between the Portfolios and Mentor and new investment advisory agreements between
the Portfolios and their investment advisors, each to become effective
upon consummation of the acquisition. Implementation of the new investment
advisory agreements, which would be substantially identical to the current
investment advisory agreements, would be subject to approval of shareholders at
a meeting expected to be held prior to the consummation of the acquisition.
September 15, 1997
