STI CLASSIC FUNDS, 497, 1996-05-14

STI CLASSIC FUNDS
497, 1996-05-14

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<PAGE>

STI CLASSIC FUNDS

INTERNATIONAL EQUITY FUND
TRUST CLASS SHARES

Supplement dated May 7, 1996
to Prospectus dated October 1, 1995

The Prospectus dated October 1, 1995 is hereby amended by the addition of
the following unaudited financial information for the International Equity Fund
for the period ended March 31, 1996.

FINANCIAL HIGHLIGHTS STI CLASSIC FUNDS
FOR THE PERIOD ENDED MARCH 31, 1996 (UNAUDITED)

For a Share Outstanding Throughout the Period

RATIO OF
RATIO OF NET
NET RATIO OF NET RATIO OF INVESTMENT
REALIZED NET NET EXPENSES INVESTMENT EXPENSES LOSS TO
NET ASSET AND DIVIDENDS ASSET ASSETS TO INCOME/ TO AVERAGE AVERAGE
VALUE NET UNREALIZED FROM NET VALUE END OF AVERAGE (LOSS) TO NET ASSETS NET ASSETS PORTFOLIO
BEGINNING INVESTMENT GAINS ON INVESTMENT END OF TOTAL PERIOD NET AVERAGE (EXCLUDING (EXCLUDING) TURNOVER
OF PERIOD LOSS INVESTMENTS INCOME PERIOD RETURN (000) ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
--------- ------ ----------- -------- ------ ------ ----- ------ ---------- --------- -------- ------

- --------------------
INTERNATIONAL
EQUITY FUND
- --------------------

<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TRUST
1996(1) $10.00 $ - $ 0.88 $ - $10.88 8.80% $168,030 1.46% 0.11% 1.70% (0.13)% 115%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------

</TABLE>

(1) Commenced operations on December 1, 1995. All ratios for the period except
total return have been annualized.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE

<PAGE>
STI CLASSIC FUNDS
TRUST SHARES
INTERNATIONAL EQUITY FUND

INVESTMENT ADVISOR TO THE FUND:
STI CAPITAL MANAGEMENT, N.A.

The STI Classic Funds (the "Trust") is a mutual fund that offers shares in a
number of separate investment portfolios. This Prospectus sets forth concisely
the information about the Trust Shares of the International Equity Fund (the
"Fund"). Investors are advised to read this Prospectus and retain it for future
reference.

A Statement of Additional Information relating to the Fund dated the same date
as this Prospectus has been filed with the Securities and Exchange Commission
and is available without charge through the Distributor, SEI Financial Services
Company, 680 East Swedesford Road, Wayne, PA 19087-1658 or by calling
1-800-428-6970. The Statement of Additional Information is incorporated into
this Prospectus by reference.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

THE TRUST'S SHARES ARE NOT SPONSORED, ENDORSED, OR GUARANTEED BY, AND DO NOT
CONSTITUTE OBLIGATIONS OR DEPOSITS OF, THE ADVISORS OR ANY OF THEIR AFFILIATES
OR CORRESPONDENTS INCLUDING SUNTRUST BANKS, INC., ARE NOT GUARANTEED OR INSURED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY
OTHER GOVERNMENTAL AGENCY, AND INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL.

OCTOBER 31, 1995
<PAGE>
2

No person has been authorized to give any information or to make any
representations not contained in this Prospectus, or in the Statement of
Additional Information relating to the Fund incorporated herein by reference, in
connection with the offering made by this Prospectus and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Trust or SEI Financial Services Company (the "Distributor"). This
Prospectus does not constitute an offering by the Trust or by the Distributor in
any jurisdiction in which such offering may not lawfully be made.

The Trust Shares are offered primarily to financial institutions
("Shareholders"), including SunTrust Banks, Inc. and its affiliates and
correspondents, for the investment of funds for which they act in a fiduciary,
agency, investment advisory or custodial capacity. Fund shares may not be
purchased directly by individuals, although institutions may purchase shares for
accounts maintained by individuals.

TABLE OF CONTENTS

<TABLE>
<S> <C>
Expense Summary...................... 3
The Trust............................ 4
Investment Objective................. 4
Investment Policies and Strategies... 5
General Investment Policies and
Strategies.......................... 6
Investment Risks..................... 6
Investment Limitations............... 8
Performance Information.............. 9
General Performance Information...... 9
Purchase Of Fund Shares.............. 9
Redemption Of Fund Shares............ 10
Dividends And Distributions.......... 10
Tax Information...................... 11
STI Classic Funds Information........ 12
Board of Trustees.................... 12

Investment Advisor................... 13
Portfolio Manager.................... 13
Banking Laws......................... 13
Distribution......................... 14
Administration....................... 14
Transfer Agent and Dividend
Disbursing Agent.................... 15
Custodian............................ 15
Legal Counsel........................ 15
Independent Public Accountants....... 15
Other Information.................... 15
Voting Rights........................ 15
Reporting............................ 15
Shareholder Inquiries................ 15
Description of Permitted
Investments......................... 15
Appendix............................. A-1
</TABLE>
<PAGE>
3

EXPENSE SUMMARY
TRUST SHARES

Below is a summary of the annual operating expenses for Trust Shares of the
International Equity Fund. A hypothetical example based on the summary is also
shown. Actual expenses may vary.

ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)

<TABLE>
<CAPTION>
INTERNATIONAL
EQUITY FUND
<S> <C>
- ------------------------------------------------------------------------------------------------------------------
Advisory Fees (After Voluntary Reductions)(1)....................................................... 1.10%
All Other Expenses.................................................................................. .36%
- ------------------------------------------------------------------------------------------------------------------
Total Operating Expenses (After Voluntary Reductions)(1)............................................ 1.46%
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Absent voluntary reductions, advisory fees, and total operating expenses,
expressed as a percentage of average net assets for the Trust Shares of the
Fund would be: 1.25% and 1.61%. Fee reductions are voluntary and may be
terminated at any time. Additional information may be found under
"Investment Advisor" and "Administration." A person that purchases shares
through an account with a financial institution may be charged separate fees
by the financial institution.

<TABLE>
<CAPTION>
INTERNATIONAL
EXAMPLE EQUITY FUND
<S> <C>
- --------------------------------------------------------------------------------------------------------------------
An investor would pay the following expenses on a $1,000 investment assuming:
(1) 5% annual return and (2) redemption at the end of each time period:
One year.......................................................................................... $ 15
Three Years....................................................................................... 46
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
</TABLE>

PERFORMANCE INFORMATION FOR PREDECESSOR COLLECTIVE FUND

The International Equity Fund will be the successor to a collective investment
fund currently managed by the Advisor. It is anticipated that a substantial
portion of the assets of this collective investment fund will be transferred to
the Fund on or about December 1, 1995 in connection with the Fund's commencement
of operations. Set forth below is certain performance data for the predecessor
collective investment fund, which is deemed relevant because the collective
investment fund was managed using virtually the same investment objective,
policies and restrictions as those used by the Fund. However, the performance
data is not necessarily indicative of the future performance of the Fund. It is
expected that the Fund initially will be somewhat smaller in asset size than the
predecessor collective investment fund. It is anticipated, however, that the
Fund will reach the same asset size as the predecessor fund before the end of
the Fund's first year of operation and will continue to grow in size thereafter.

The predecessor collective fund did not incur expenses that correspond to the
advisory, administrative, and other fees to which the Fund is subject.
Accordingly, the following performance information has been adjusted by applying
the current total expense ratios for the Fund, which reduced the actual
performance of the collective fund. The expense ratio is that set forth under
"Annual Operating Expenses" (after giving effect to anticipated waivers and
reimbursements).

Total Cumulative Return (adjusted to reflect current Fund expenses, net of
voluntary waivers and reimbursements for period ended 9/30/95.)

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------
DATE OF
INCEPTION SINCE
OF FUND 1 MONTH 3 MONTHS INCEPTION
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
International
Equity
Collective Fund 2/1/95 4.04% 10.86% 32.53%
</TABLE>

THE TRUST

STI CLASSIC FUNDS (the "Trust") is a diversified, open-end management investment
company that provides a convenient and economical means of investing in several
professionally managed portfolios of securities. The Trust currently offers
units of beneficial interest ("shares") in a number of separate Funds.
Shareholders may purchase shares in The International Equity Fund (the "Fund")
through three separate classes (Trust Shares, Flex Shares and Investor Shares)
which provide for variations in distribution and transfer agent fees, voting
rights and dividends. Except for differences between classes, each share of the
Fund represents an undivided, proportionate interest in the Fund. This
Prospectus relates to the Trust Shares of the Fund. The Flex Shares and Investor
Shares of the Fund currently are not available for purchase.

INVESTMENT OBJECTIVE

THE INTERNATIONAL EQUITY FUND seeks to provide long term capital appreciation by
investing primarily in a diversified portfolio of equity securities of foreign
issuers.

There can be no assurance that the Fund will achieve its investment objective.

The investment objective of the Fund is nonfundamental and may be changed
without shareholder approval.
<PAGE>
5

INVESTMENT POLICIES AND STRATEGIES

INTERNATIONAL EQUITY FUND

The Fund, under normal market conditions will invest at least 65% of its assets
in equity securities of foreign issuers consisting of: common and preferred
stocks, warrants, options and securities convertible into common stock.

Securities of foreign issuers purchased by the Fund may be purchased in foreign
markets, on United States registered exchanges, the over-the-counter market or
in the form of sponsored or unsponsored American Depositary Receipts ("ADRs")
traded on registered exchanges or NASDAQ, or sponsored or unsponsored European
Depositary Receipts ("EDRs").

The Fund may enter into forward foreign currency contracts as a hedge against
possible variations in foreign exchange rates. A forward foreign currency
contract is a commitment to purchase or sell a specified currency, at a
specified future date, at a specified price. The Fund may enter into forward
foreign currency contracts to hedge a specific security transaction or to hedge
a portfolio position. The Fund also may purchase and write put and call options
on foreign currencies (traded on U.S. and foreign exchanges or over-the-counter
markets) to manage the portfolios exposure to changes in dollar exchange rates.

The Fund expects to be fully invested in the investments described above, but
may invest up to 35% of its total assets in bonds and debentures issued by
non-U.S. or U.S. companies, securities issued or guaranteed by foreign and U.S.
governments and foreign and U.S. commercial paper. The Fund may invest in
futures contracts, including stock index futures contracts, and options on
futures contracts. The bonds that the Fund may purchase may be rated in any
rating category or may be unrated provided that no more than 10% of the Fund's
total assets will be rated below BBB by Standard & Poor's Corporation or below
Baa by Moody's Investor Service, Inc. or unrated securities of comparable
quality (see "Investment Risks -- High Yield -- Lower Rated Bonds"). When
investing in bonds, the Fund may seek capital gains by taking advantage of price
appreciation caused by interest rate and credit quality changes. The Fund may
also purchase shares of closed-end investment companies that invest in the
securities of issuers in a single country or region. The Fund is also permitted
to acquire floating and variable rate securities, purchase securities on a when-
issued basis and purchase illiquid securities.

The Fund will invest in the foreign issues of at least three different countries
outside the United States. A foreign issue is one the issuer of which (1) is
organized under the laws of a specific country, (2) for which the principal
securities trading market is in a specific country or (3) derives a significant
proportion (at least 50 percent) of their revenues or profits from goods
produced or sold, investments made, or services performed in a specific country
or which have at least 50 percent of their assets situated in that country. The
Fund will invest primarily in developed countries, (for example Japan, Canada
and the United Kingdom). In addition, the Fund may invest in securities of
issuers whose principal activities are in countries with emerging markets. The
Fund defines an emerging market country as any country the economy and market of
which the World Bank or the United Nations considers to be emerging or
developing.

The annual portfolio turnover rate for the Fund is not expected to exceed 100%.
<PAGE>
6

GENERAL INVESTMENT POLICIES AND STRATEGIES

For temporary defensive purposes during periods when its Advisor determines that
market conditions warrant, the Fund may invest up to 100% of its assets in money
market instruments consisting of securities issued or guaranteed as to principal
and interest by the U.S. Government, its agencies or instrumentalities,
custodial receipts involving U.S. Treasury obligations, repurchase agreements,
certificates of deposit, bankers' acceptances, and time deposits issued by banks
or savings and loan associations and commercial paper rated in the highest
rating category, and may hold a portion of its assets in cash. The Fund may not
be pursuing its investment objective when it is engaged in temporary defensive
investing. The Fund may also invest in money market instruments for liquidity
purposes.

The Fund may invest, subject to its investment objective and policies, in zero
coupon obligations. Zero coupon obligations are sold at original issue discount
and do not make periodic payments. Zero coupon obligations may be subject to
greater fluctuations in value due to interest rate changes.

The Fund may purchase restricted securities, including Rule 144A securities,
that the Advisor determines are liquid pursuant to guidelines established by the
Trust's Board of Trustees.

In the event that a security owned by the Fund is downgraded below the stated
rating categories, the Advisor will review and take appropriate action with
regard to the security.

The Fund may borrow money for temporary or emergency purposes in an amount not
to exceed one-third of the value of its total assets. The Fund may not purchase
additional securities while its outstanding borrowings exceed 5% of its assets.

The Fund's purchase of shares of other investment companies is limited by the
Investment Company Act of 1940 and will ordinarily result in an additional layer
of charges and expenses.

The Fund may engage in securities lending and will limit such practice to 33
1/3% of its total assets.

It is a non-fundamental policy of the Fund to invest no more than 15% of its net
assets in illiquid securities. An illiquid security is a security which cannot
be disposed of within seven days in the usual course of business at a price
approximating its carrying value.

For additional information regarding permitted investments, see "Description of
Permitted Investments" in this Prospectus and in the Statement of Additional
Information.

INVESTMENT RISKS
FOREIGN SECURITIES AND FOREIGN CURRENCY CONTRACTS

Investing in the securities of foreign companies and the utilization of forward
foreign currency contracts involve special risks and considerations not
typically associated with investing in U.S. companies. These risks and
considerations include differences in accounting, auditing and financial
reporting standards, generally higher commission rates on foreign portfolio
transactions, the possibility of expropriation or confiscatory taxation, adverse
changes in investment or exchange control regulations, political instability
which could affect U.S. investment in foreign countries and potential
restrictions of the flow of international capital and currencies. Foreign
companies may also be subject to less government regulation than U.S. companies.
Moreover, the dividends payable on the foreign securities may be subject to
foreign withholding taxes, thus reducing the net amount of income
<PAGE>
7
available for distribution to the Fund's Shareholders. Further, foreign
securities often trade with less frequency and volume than domestic securities
and, therefore, may exhibit greater price volatility. Changes in foreign
exchange rates will affect, favorably or unfavorably, the value of those
securities which are denominated or quoted in currencies other than the U.S.
dollar.

By entering into forward foreign currency contracts, the Fund will seek to
protect the value of its investment securities against a decline in the value of
a currency. However, these forward foreign currency contracts will not eliminate
fluctuations in the underlying prices of the securities. Rather, they simply
establish a rate of exchange which one can obtain at some future point in time.
Although such contracts tend to minimize the risk of loss due to a decline in
the value of the hedged currency, also, they tend to limit any potential gain
which might result should the value of such currency increase.

The Fund's investments in emerging markets can be considered speculative, and
therefore may offer higher potential for gains and losses than investments in
developed markets of the world. With respect to any emerging country, there is
the greater potential for nationalization, expropriation or confiscatory
taxation, political changes, government regulation, social instability or
diplomatic developments (including war) which could affect adversely the
economies of such countries or investments in such countries. In addition, it
may be difficult to obtain and enforce a judgment in the courts of such
countries. The economies of developing countries generally are heavily dependent
upon international trade and, accordingly, have been and may continue to be
adversely affected by trade barriers, exchange controls, managed adjustments in
relative currency values and other protectionist measures imposed or negotiated
by the countries with which they trade. Investment in Eastern European countries
and the countries which made up the former Soviet Union may be affected by
political decisions that could cause such countries to revert to a prior system
of government.

EQUITY SECURITIES

Investments in equity securities in general are subject to market risks that may
cause their prices to fluctuate over time. The value of convertible equity
securities is also affected by prevailing interest rates, the credit quality of
the issuer and any call provision. Fluctuations in the value of equity
securities in which the Fund invests will cause the net asset value of the Fund
to fluctuate.

FIXED INCOME SECURITIES

The market value of the Fund's fixed income investments will change in response
to interest rate changes and other factors. During periods of falling interest
rates, the values of outstanding fixed income securities generally rise.
Conversely, during periods of rising interest rates, the values of such
securities generally decline. Securities with longer maturities are subject to
greater fluctuations in value than securities with shorter maturities. Changes
by a nationally recognized statistical rating organization ("NRSRO") in the
rating of any fixed income security and in the ability of an issuer to make
payments of interest and principal also affect the value of these investments.
Changes in the value of the Fund's securities will not affect cash income
derived from these securities but will affect the Fund's net asset value.
<PAGE>
8

Securities rated BBB by S&P or Baa by Moody's (investment grade bonds) are
deemed by these rating services to have speculative characteristics.

Guarantees of the Fund's Securities by the U.S. Government or its agencies or
instrumentalities guarantee only the payment of principal and interest on the
guaranteed securities, and do not guarantee the securities' yield or value of
the yield or value of the Fund's shares.

There is a risk that the current interest rate on floating and variable rate
instruments may not accurately reflect existing market interest rates.

HIGH YIELD, LOWER RATED BONDS

The Fund's investments in high yield, lower rated bonds ("junk bonds") involve
greater risk of default or price declines than investments in investment grade
securities (rated BBB or higher by S&P or Baa or higher by Moody's) due to
changes in the issuer's creditworthiness. The market for high risk, high yield
securities may be thinner and less active, causing market price volatility and
limited liquidity in the secondary market. This may limit the ability of the
Fund to sell such securities at their fair market value either to meet
redemption requests or in response to changes in the economy or the financial
markets. Market prices for high risk, high yield securities may also be affected
by investors' perception of credit quality and the outlook for economic growth.
Thus, prices for high risk, high yield securities may move independently of
interest rates and the overall bond market. In addition, the market for high
risk, high yield securities may be adversely affected by legislative and
regulatory developments.

INVESTMENT LIMITATIONS

The following investment limitations constitute fundamental policies of the
Fund. Fundamental policies cannot be changed with respect to the Fund without
the consent of the holders of a majority of the Fund's outstanding shares. The
term "majority of the outstanding shares" means the vote of (i) 67% or more of
the Fund's shares present at a meeting, if more than 50% of the outstanding
shares of the Fund are present or represented by proxy, or (ii) more than 50% of
the Fund's outstanding shares, whichever is less.

The Fund may not:

1. Purchase securities of any issuer (except securities issued or guaranteed by
the United States, its agencies or instrumentalities and repurchase agreements
involving such securities) if as a result more than 5% of the total assets of
the Fund would be invested in the securities of such issuer; provided, however,
that the Fund may invest up to 25% of its total assets without regard to this
restriction as permitted by applicable law.

2. Purchase any securities which would cause more than 25% of the total assets
of the Fund to be invested in the securities of one or more issuers conducting
their principal business activities in the same industry, provided that this
limitation does not apply to investments in obligations issued or guaranteed by
the U.S. Government or its agencies and instrumentalities, repurchase agreements
involving such securities or tax-exempt securities issued by governments or
political subdivisions of governments. For purposes of this limitation, (i)
utility companies will be divided according to their services, for example, gas,
gas transmission, electric and telephone will each be considered a separate
industry; (ii) financial service companies will be classified according to the
end users of their services, for example, automobile
<PAGE>
9
finance, bank finance and diversified finance will each be considered a separate
industry; and (iii) supranational entities will be considered to be a separate
industry.

The foregoing percentages will apply at the time of the purchase of a security.
Additional investment limitations are set forth in the Statement of Additional
Information.

PERFORMANCE INFORMATION

From time to time, the Fund may advertise performance (total return and yield).
These figures will be historical and are not intended to indicate future
performance. The yield of the Fund refers to the annualized income generated by
an investment in the Fund over a specified 30-day period. The yield is
calculated by assuming that the income generated by the investment during that
period is generated over one year and is shown as a percentage of the
investment.

The total return of the Fund refers to the average compounded rate of return on
a hypothetical investment, including any sales charge imposed, for designated
time periods (including but not limited to, the period from which the Fund
commenced operations through the specified date), assuming that the entire
investment is redeemed at the end of each period and assuming the reinvestment
of all dividend and capital gains distributions.

GENERAL PERFORMANCE INFORMATION

The performance of Trust Shares of the Trust will normally be higher than for
Investor Shares and Flex Shares of the Trust because Investor Shares and Flex
Shares are subject to distribution and certain transfer agent fees not charged
to Trust Shares. The performance of Flex Shares in comparison to Investor Shares
will vary depending upon investment time horizon.

The Fund may periodically compare its performance to other mutual funds tracked
by mutual fund rating services, to broad groups of comparable mutual funds or to
unmanaged indices which may assume reinvestment of dividends but generally do
not reflect deductions for administrative and management costs.

PURCHASE OF FUND SHARES

Trust Shares of the Fund are sold primarily to financial institutions, including
subsidiaries of SunTrust Banks, Inc. ("SunTrust"), for the investment of funds
for which they act in a fiduciary, agency, investment advisory or custodial
capacity. Individuals may not purchase Trust Shares directly, although
individuals may be able to purchase Trust Shares through accounts maintained
with financial institutions. Trust Shares are sold without a sales charge,
although financial institutions may charge their customer accounts for services
provided in connection with the purchase of shares. Financial institutions may
impose an earlier cut-off time for receipt of purchase orders directed through
them to allow for processing and transmittal of these orders to the Transfer
Agent for effectiveness the same day. Information concerning these services and
any charges will be provided to customers by the financial institutions. Trust
Shares will be held of record by the financial institutions, although customers
may have or be given the right to vote the shares depending upon the terms of
their relationship with the financial institution. Confirmations of share
purchases and redemptions will be sent to the financial institution as the
shareholder of record.

Shares may be purchased on days on which the New York Stock Exchange is open for
business ("business day").

A purchase order for the Fund will be effective as of the business day received
by the Transfer
<PAGE>
10

Agent if the Transfer Agent receives the order before 4:00 p.m. Eastern time and
payment is received within one day. The purchase price of shares of the Fund is
the net asset value next determined after a purchase order is effective plus any
applicable sales charge (the "offering price"). The net asset value per share of
the Fund is determined by dividing the total market value of the Fund's
investments and other assets, less any liabilities, by the total outstanding
shares of the Fund. Net asset value per share is determined daily as of the
close of business of the New York Stock Exchange (currently 4:00 p.m. Eastern
time) on any business day. Pursuant to guidelines established by the Trustees,
the Trust may use a pricing service to provide market quotations or valuations
for securities owned by the Fund. Purchases will be made in full and fractional
shares of the Trust calculated to three decimal places.

The Trust reserves the right to reject a purchase order when the Distributor
determines that it is not in the best interest of the Trust and/or
Shareholder(s).

Neither the Trust's Transfer Agent nor the Trust will be responsible for any
loss, liability, cost or expense for acting upon telephone or wire instructions
reasonably believed to be genuine. The Trust maintains procedures, including
identification methods and other means, for ascertaining the identity of callers
and authenticity of instructions.

Shares of the Fund are offered only to residents of states in which the shares
are eligible for purchase. Shareholders in certain states may be required to
purchase shares through institutions registered as Broker/Dealers in such
states.

Although the methodology and procedures for calculating the net asset value for
Trust Shares are identical to those of Investor Shares and Flex Shares, the net
asset value per share of the classes of the Fund may differ because of the
distribution, service, and certain transfer agent expenses charged to Investor
Shares and Flex Shares.

REDEMPTION OF FUND SHARES

An order to redeem shares must be transmitted to the transfer agent by the
financial institution as the record owner of Trust Shares. Financial
institutions may establish procedures for their customers to request redemption
of Trust Shares held in their account with the financial institution. Customers
should contact their financial institution for information concerning these
procedures.

Redemption orders must be received by the Transfer Agent before 4:00 p.m.
Eastern time on any business day to be effective that day. Redemption proceeds
are normally remitted in federal funds wired to the record owner of the shares
within one business day, but in no event more than seven days following the
effective date of the order. No charge for wiring redemption payments is imposed
by the Trust. Redemption orders are effected at the net asset value per share
next determined after an order is effective.

The Trust intends to pay cash for all shares redeemed, but under abnormal
conditions which make payment in cash unwise, payment may be made wholly or
partly in liquid portfolio securities with a market value equal to the
redemption price. In such circumstances, an investor may incur brokerage costs
in converting such securities to cash.

DIVIDENDS AND DISTRIBUTIONS

Dividends are declared and paid annually by the Fund. The Fund's net realized
capital gains (including net short-term capital gains) are
<PAGE>
11
distributed at least annually. Net income for dividend purposes consists of (i)
interest accrued and original issue discount earned on the Fund's assets, (ii)
plus the amortization of market discount and minus the amortization of market
premium on such assets, (iii) plus dividend or distribution income on such
assets, (iv) less accrued expenses directly attributable to the Fund and the
general expenses of the Trust prorated to the Fund on the basis of its relative
net assets. Shareholders of record on the record date will be entitled to
receive dividends.

The net asset value of Trust Shares of the Fund will be reduced by the amount of
any dividend or distribution. Dividends and distributions are paid in the form
of additional Trust Shares of the Fund unless the customer has elected prior to
the date of distribution to receive payment in cash. Such election, or any
revocation thereof, must be made in writing prior to the date of distribution to
the Trust's transfer agent and will become effective with respect to dividends
paid after its receipt. Dividends and distributions are paid within ten days of
the end of the time period to which the dividend relates. Dividends and
distributions payable to a Shareholder are paid in cash within ten business days
after a Shareholder's complete redemption of its Trust Shares in the Fund.

The amount of dividends payable on Trust Shares will be more than the dividends
payable on Investor Shares and Flex Shares because of the distribution and
certain transfer agent expenses charged to Investor Shares and Flex Shares. The
amount of dividends payable on Flex Shares generally will be less than the
amount of dividends payable on Investor Shares due to the higher distribution
and service expenses of Flex Shares.

TAX INFORMATION

The following summary of federal income tax consequences is based on current tax
laws and regulations, which may be changed by legislative, judicial or
administrative action. No attempt has been made to present a detailed
explanation of the federal, state, or local income tax treatment of the Fund or
its Shareholders. Shareholders are urged to consult their tax advisors regarding
specific questions as to federal, state and local income taxes.

TAX STATUS OF THE FUND:

The Fund is treated as a separate entity for federal tax purposes and is not
combined with the Trust's other Funds. The Fund intends to qualify for the
special tax treatment afforded regulated investment companies by the Internal
Revenue Code of 1986, as amended, (the "Code") so that it will be relieved of
federal income tax on that part of its net investment income and net capital
gains (the excess of long-term capital gains over net short-term capital loss)
which is distributed to Shareholders. The Fund intends to make sufficient
distributions prior to the end of each calendar year to avoid liability for
federal excise tax.

TAX STATUS OF DISTRIBUTIONS:

The Fund will distribute substantially all of its net investment income
(including, for this purpose, net short-term capital gains) to Shareholders.
Dividends from net investment income paid by the Fund will be taxable to
Shareholders as ordinary income whether received in cash or in additional
shares. Dividends from net investment income will qualify for the dividends
received deduction for corporate Shareholders only to the extent such
<PAGE>
12
distributions are derived from dividends paid by domestic corporations. Any net
capital gains will be distributed annually and will be taxed to Shareholders as
long-term capital gains, regardless of how long the Shareholder has held shares
and regardless of whether distributions are received in cash or in additional
shares. For certain individual Shareholders, net long-term capital gains may be
taxed at a lower rate than ordinary income. The Fund will make annual reports to
Shareholders of the federal income tax status of all distributions. Dividends
declared by the Fund in October, November or December of any year and payable to
Shareholders of record on a date in that month will be deemed to have been paid
by the Fund and received by the Shareholder on December 31 of that year, if paid
by the Fund at any time during the following January.

Income derived by the Fund from obligations of foreign issuers may be subject to
foreign withholding taxes. The Fund expects to elect to treat Shareholders as
having paid their proportionate share of such foreign taxes.

Income received on direct U.S. obligations is exempt from tax at the state level
when received directly by the Fund and may be exempt, depending on the state,
when received by the Shareholder as income dividends from the Fund, provided
certain state-specific conditions are satisfied. Not all states permit such
income dividends to be tax exempt and some require that a certain minimum
percentage of an investment company's income be derived from state tax-exempt
interest. The Fund will inform Shareholders annually of the percentage of income
and distributions derived from direct U.S. obligations. Shareholders should
consult their tax advisors to determine whether any portion of the income
dividends received from the Fund is considered tax-exempt in their particular
state.

Sale, exchange or redemption of Fund shares is a taxable event to the
Shareholder.

STI CLASSIC FUNDS INFORMATION
THE TRUST

The Trust was organized as a Massachusetts Business Trust under a Declaration of
Trust dated January 15, 1992. The Declaration of Trust permits the Trust to
offer separate portfolios of shares and different classes of each portfolio of
shares. All consideration received by the Trust for shares of any portfolio of
shares and all assets of such portfolio of shares belong to that portfolio of
shares and would be subject to liabilities related thereto.

The Trust pays its expenses, including fees of its service providers, audit and
legal expenses, expenses of preparing prospectuses, proxy solicitation material
and reports to Shareholders, costs of custodial services and registering the
shares under federal and state securities laws, pricing, insurance expenses,
litigation and other extraordinary expenses, brokerage costs, interest charges,
taxes and organization expenses.

BOARD OF TRUSTEES

The management and affairs of the Trust are supervised by the Trustees under the
laws governing business trusts in the Commonwealth of Massachusetts. The
Trustees have approved contracts under which, as described below, certain
companies provide essential management services to the Trust.
<PAGE>
13

INVESTMENT ADVISOR

The Advisor is an indirect wholly-owned subsidiary of SunTrust Banks, Inc.
("SunTrust"), a southeastern regional bank holding company with assets of $44.2
billion as of June 30, 1995. SunTrust ranks among the twenty largest U.S.
banking companies. Its three principal subsidiaries -- SunTrust Banks of
Florida, Inc., Suntrust Banks of Georgia, Inc. and SunTrust Banks of Tennessee
- -- provide a wide range of personal and corporate banking, trust, and investment
services through more than 600 locations in the three-state area. Total
discretionary assets under management with SunTrust Banks, Inc. equalled
approximately $42 billion as of December 31, 1994.

STI Capital Management, N.A. ("STI Capital") serves as the Advisor to the Fund.
As of June 30, 1995, STI Capital had discretionary management authority with
respect to assets of approximately $11.1 billion. The principal business address
of STI Capital is P.O. Box 3808, Orlando, FL 32802.

The Trust and the Advisor have entered into an advisory agreement (the "Advisory
Agreement"). Under the Advisory Agreement, the Advisor makes the investment
decisions for the assets of the Fund and continuously reviews, supervises and
administers the Fund's investment program. The Advisor discharges its
responsibilities subject to the supervision of, and policies established by, the
Trustees of the Trust. STI CLASSIC FUNDS ARE NOT DEPOSITS, ARE NOT INSURED OR
GUARANTEED BY THE FDIC OR ANY OTHER GOVERNMENT AGENCY, AND ARE NOT ENDORSED OR
GUARANTEED BY AND DO NOT CONSTITUTE OBLIGATIONS OF SUNTRUST BANKS, INC. OR ANY
OF ITS AFFILIATES. INVESTMENTS IN THE FUND INVOLVES RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL. RETURNS AND PRINCIPAL VALUES WILL FLUCTUATE AND SHARES AT
REDEMPTION MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THERE IS NO
GUARANTEE THAT ANY STI CLASSIC FUND WILL ACHIEVE ITS INVESTMENT OBJECTIVE. With
respect to the Fund, the Advisor may execute brokerage or other agency
transactions through affiliates of the Advisor.

For the services provided and expenses incurred pursuant to the Investment
Advisory Agreement, STI Capital is entitled to receive advisory fees computed
daily and paid monthly at the annual rate of 1.25% of the average daily net
assets of the Fund.

Although the advisory fee for the Fund is higher than advisory fees paid by
other mutual funds, the Trust believes that the fee is comparable to the
advisory fee paid by other mutual funds with similar investment objectives and
policies. From time to time, the Advisor may waive (either voluntarily or
pursuant to applicable state limitations) the advisory fee payable by the Fund.
Currently, the Advisor has agreed to voluntary reductions in their respective
fees in amounts necessary to maintain the total operating expenses at the
amounts set forth in the Expense Summary. Voluntary reductions of fees may be
terminated at anytime.

PORTFOLIO MANAGER

Mr. Dan Jaworski has been responsible for the day-to-day management of the Fund
since its inception. Mr. Jaworski joined STI Capital in 1995. Prior to joining
STI Capital, he managed international portfolios at Lazard Freres Asset
Management from 1993 through 1994 and the Principal Financial Group from 1988
through 1993.

BANKING LAWS

Banking laws and regulations, including the Glass-Steagall Act as presently
interpreted by
<PAGE>
14
the Board of Governors of the Federal Reserve System, presently (a) prohibit a
bank holding company registered under the Federal Bank Holding Company Act of
1956 or its affiliates from sponsoring, organizing, controlling, or distributing
the shares of a registered, open-end investment company continuously engaged in
the issuance of its shares, and generally prohibit banks from underwriting
securities, but (b) do not prohibit such a bank holding company or affiliate or
banks generally from acting as an investment advisor, transfer agent, or
custodian to such an investment company or from purchasing shares of such a
company as agent for and upon the order of a customer. The Advisor believes that
it may perform the services for the Fund contemplated by its agreement described
in this Prospectus without violation of applicable banking laws or regulations.
However, future changes in legal requirements relating to the permissible
activities of banks and their affiliates, as well as future interpretations of
present requirements, could prevent the Advisor from continuing to perform
services for the Fund. If the Advisor was prohibited from providing services to
the Fund, the Board of Trustees would consider selecting other qualified firms.
Any new investment advisory agreements would be subject to Shareholder approval.

If current restrictions preventing a bank or its affiliates from legally
sponsoring, organizing, controlling, or distributing shares of an investment
company were relaxed, the Advisor, or its affiliates, would consider the
possibility of offering to perform additional services for the Fund. It is not
possible, of course, to predict whether or in what form such legislation might
be enacted or the terms upon which the Advisor, or such affiliates, might offer
to provide such services.

In addition, state securities laws on that issue may differ from the
interpretations of federal law expressed herein and banks and financial
institutions may be required to register as dealers pursuant to state law.

DISTRIBUTION

SEI Financial Services Company (the "Distributor"), a wholly-owned subsidiary of
SEI Corporation ("SEI"), and the Trust are parties to a distribution agreement
("Distribution Agreement"). No compensation is paid to the Distributor for
distribution services for the Trust Shares of the Fund. Trust Shares of the Fund
are offered primarily to institutional investors, including affiliates and
correspondents for the investment of funds in which they act in a fiduciary,
agency or custodial capacity. It is possible that a financial institution may
offer different classes of shares to its customers and thus receive different
compensation with respect to different classes of shares.

The Fund may also execute brokerage or other agency transactions through the
Distributor for which the Distributor receives compensation.

ADMINISTRATION

SEI Financial Management Corporation (the "Administrator"), a wholly-owned
subsidiary of SEI, and the Trust are parties to an Administration Agreement (the
"Administration Agreement"). Under the terms of the Administration Agreement,
the Administrator provides the Trust with certain administrative services, other
than investment advisory services, including regulatory reporting, all necessary
office space, equipment, personnel, and facilities.
<PAGE>
15

The Administrator is entitled to a fee, which is calculated daily and paid
monthly, at an annual rate as follows:

<TABLE>
<CAPTION>
AVERAGE AGGREGATE DAILY NET ASSETS FEE
- --------------------------------------------- ---------
<S> <C>
$1 - $1 billion .10%
over $1 billion to $5 billion .07%
over $5 billion to $8 billion .05%
over $8 billion to $10 billion .045%
over $10 billion .04%
</TABLE>

TRANSFER AGENT AND DIVIDEND
DISBURSING AGENT

Federated Services Company, Pittsburgh, PA is the Transfer Agent for the shares
of the Trust and dividend disbursing agent for the Trust.

CUSTODIAN

SunTrust Bank, Atlanta, c/o STI Trust & Investment Operations, Inc., 303
Peachtree Street N.E., 14th Floor, Atlanta, GA 30308, serves as Custodian of the
assets of each Fund of the Trust except the International Equity Index Fund and
the International Equity Fund. The Bank of California, 475 Sansome Street, Suite
1200, San Francisco, CA 94111, serves as Custodian for the International Equity
Index Fund. The Bank of New York, One Wall Street, New York, NY 10286, serves as
Custodian for the International Equity Fund. Each Custodian holds cash,
securities and other assets of the Trust as required by the Investment Company
Act of 1940.

LEGAL COUNSEL

Morgan, Lewis & Bockius LLP, Philadelphia, PA, serves as legal counsel to the
Trust.

INDEPENDENT PUBLIC ACCOUNTANTS

The independent public accountants to the Trust are Arthur Andersen, LLP,
Philadelphia, PA.

OTHER INFORMATION
VOTING RIGHTS

Each share held entitles the Shareholder of record to one vote. Each Fund or
class of a Fund will vote separately on matters relating solely to that Fund or
class. As a Massachusetts Business Trust, the Trust is not required to hold
annual meetings of Shareholders but approval will be sought for certain changes
in the operation of the Trust and for the election of Trustees under certain
circumstances. In addition, a Trustee may be removed by the remaining Trustees
or by Shareholders at a special meeting called upon written request of
Shareholders owning at least 10% of the outstanding shares of the Trust. In the
event that such a meeting is requested the Trust will provide appropriate
assistance and information to the Shareholders requesting the meeting.

REPORTING

The Trust issues unaudited financial information semi-annually and audited
financial statements annually. The Trust furnishes proxy statements and other
reports to Shareholders of record.

SHAREHOLDER INQUIRIES

Shareholders may contact their local Trust and Investment Services office of
SunTrust Bank, Inc.

DESCRIPTION OF PERMITTED INVESTMENTS

AMERICAN DEPOSITARY RECEIPTS ("ADRs") -- ADRs are securities, typically issued
by a U.S. financial institution (a "depositary"), that evidence ownership
interests in a security or a pool of securities issued by a foreign issuer and
deposited with the depositary. ADRs may be available through "sponsored" or
"unsponsored" facilities. A
<PAGE>
16
sponsored facility is established jointly by the issuer of the security
underlying the receipt and a depositary, whereas an unsponsored facility may be
established by a depositary without participation by the issuer of the
underlying security. Holders of unsponsored depositary receipts generally bear
all the costs of the unsponsored facility. The depositary of an unsponsored
facility frequently is under no obligation to distribute shareholder
communications received from the issuer of the deposited security or to pass
through, to the holders of the receipts, voting rights with respect to the
deposited securities.

BANKERS' ACCEPTANCES -- Bankers' acceptances are bills of exchange or time
drafts drawn on and accepted by a commercial bank. Bankers' acceptances are used
by corporations to finance the shipment and storage of goods. Maturities are
generally six months or less.

CERTIFICATES OF DEPOSIT-- Certificates of deposit are interest bearing
instruments with a specific maturity. They are issued by banks and savings and
loan institutions in exchange for the deposit of funds and normally can be
traded in the secondary market prior to maturity. Certificates of deposit with
penalties for early withdrawal will be considered illiquid.

COMMERCIAL PAPER -- Commercial paper is a term used to describe unsecured
short-term promissory notes issued by banks, municipalities, corporations and
other entities. Maturities on these issues vary from a few to 270 days.

CONVERTIBLE SECURITIES -- Convertible securities are corporate securities that
are exchangeable for a set number of another security at a prestated price.
Convertible securities typically have characteristics similar to both fixed
income and equity securities. Because of the conversion feature, the market
value of a convertible security tends to move with the market value of the
underlying stock. The value of a convertible security is also affected by
prevailing interest rates, the credit quality of the issuer, and any call
provisions.

CORPORATE DEBT OBLIGATIONS -- Debt instruments issued by corporations with
maturities exceeding 270 days. Such instruments may include putable corporate
bonds and zero coupon bonds.

CUSTODIAL RECEIPTS -- Interests in separately traded interest and principal
component parts of U. S. Treasury obligations that are issued by banks or
brokerage firms and are created by depositing U. S. Treasury obligations into a
special account at custodian bank. The custodian holds the interest and
principal payments for the benefit of the registered owners of the certificates
or receipts. The custodian arranges for the issuance of the certificates or
receipts evidencing ownership and maintains the register. Receipts include
"Treasury Receipts" ("TR's"), "Treasury Investment Growth Receipts" ("TIGR's"),
and "Certificates of Accrual on Treasury Securities" ("CATS"). TR's, TIGR's and
CATS are sold as zero coupon securities. See "Zero Coupon Obligations."

EUROPEAN DEPOSITARY RECEIPTS ("EDRs") -- EDRs are securities, typically issued
by a non-U.S. financial institution, that evidence ownership interests in a
security or a pool of securities issued by either a U.S. or foreign issuer. EDRs
may be available for investment through "sponsored" or "unsponsored" facilities.
See "ADRs."

FORWARD FOREIGN CURRENCY CONTRACTS -- A forward foreign currency contract
involves an obligation to purchase or sell a specific currency amount at a
future date, agreed upon by the parties, at a price set at the time of the
contract. The Fund may also enter into a contract to sell, for a fixed amount of
U.S. dollars or other appropriate currency,
<PAGE>
17

the amount of foreign currency approximating the value of some or all of the
Fund's securities denominated in such foreign currency.

At the maturity of a forward contract, the Fund may either sell a portfolio
security and make delivery of the foreign currency, or it may retain the
security and terminate its contractual obligation to deliver the foreign
currency by purchasing an "offsetting" contract with the same currency trader,
obligating it to purchase, on the same maturity date, the same amount of the
foreign currency. The Fund may realize a gain or loss from currency
transactions.

FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS -- Futures contracts provide
for the future sale by one party and purchase by another party of a specified
amount of a specific security at a specified future time and at a specified
price. An option on a futures contract gives the purchaser the right, in
exchange for a premium, to assume a position in a futures contract at a
specified exercise price during the term of the option. The Fund may use futures
contracts and related options for bona fide hedging purposes, to offset changes
in the value of securities held or expected to be acquired, to minimize
fluctuations in foreign currencies, or to gain exposure to a particular market
or instrument. The Fund will minimize the risk that it will be unable to close
out a futures contract by only entering into futures contracts which are traded
on national futures exchanges.

Stock index futures are futures contracts for various stock indices that are
traded on registered securities exchanges. A stock index futures contract
obligates the seller to deliver (and the purchaser to take) an amount of cash
equal to a specific dollar amount times the difference between the value of a
specific stock index at the close of the last trading day of the contract and
the price at which the agreement is made.

There are risks associated with these activities, including the following: (1)
the success of a hedging strategy may depend on an ability to predict movements
in the prices of individual securities, fluctuations in markets and movements in
interest rates, (2) there may be an imperfect or no correlation between the
changes in market value of the securities held by the Fund and the prices of
futures and options on futures, (3) there may not be a liquid secondary market
for a futures contract or option, (4) trading restrictions or limitations may be
imposed by an exchange, and (5) government regulations may restrict trading in
futures contracts and futures options.

ILLIQUID SECURITIES -- Illiquid securities are securities that cannot be
disposed of within seven business days at approximately the price at which they
are being carried on the Fund's books. An illiquid security includes a demand
instrument with a demand notice period exceeding seven days, where there is no
secondary market for such security, and repurchase agreements with durations (or
maturities) over seven days in length.

OPTIONS ON CURRENCIES -- The Fund may purchase and write put and call options on
foreign currencies (traded on U.S. and foreign exchanges or over-the-counter
markets) to manage the portfolio's exposure to changes in dollar exchange rates.
Call options on foreign currency written by the Fund will be "covered," which
means that the Fund will own an equal amount of the underlying foreign currency.
With respect to put options on foreign currency written by the Fund, the Fund
will establish a segregated account with its custodian bank consisting of cash,
U.S. Government securities or other high grade liquid debt securities in an
amount equal to the amount the Fund would be required to pay upon exercise of
the put.
<PAGE>
18

REPURCHASE AGREEMENTS -- Repurchase agreements are agreements by which the Fund
obtains a security and simultaneously commits to return the security to the
seller at an agreed upon price on an agreed upon date within a number of days
from the date of purchase. The custodian will hold the security as collateral
for the repurchase agreement. The Fund bears a risk of loss in the event the
other party defaults on its obligations and the Fund is delayed or prevented
from exercising its right to dispose of the collateral or if the Fund realizes a
loss on the sale of the collateral. The Fund will enter into repurchase
agreements only with financial institutions deemed to present minimal risk of
bankruptcy during the term of the agreement based on established guidelines.
Repurchase agreements are considered loans under the Investment Company Act of
1940.

RESTRICTED SECURITIES -- Restricted securities are securities that may not be
sold freely to the public absent registration under the Securities Act of 1933
or an exemption from registration. Rule 144A securities are securities that have
not been registered under the Securities Act of 1933, but which may be traded
between certain institutional investors, including investment companies. The
Trust's Board of Trustees is responsible for developing guidelines and
procedures for determining the liquidity of restricted securities and monitoring
the Advisors' implementation of the guidelines and procedures.

SECURITIES LENDING -- In order to generate additional income, the Fund may lend
securities which it owns pursuant to agreements requiring that the loan be
continuously secured by collateral consisting of cash, securities of the U.S.
Government or its agencies equal to at least 100% of the market value of the
securities lent. The Fund continues to receive interest on the securities lent
while simultaneously earning interest on the investment of cash collateral.
Collateral is marked to market daily. There may be risks of delay in recovery of
the securities or even loss of rights in the collateral should the borrower of
the securities fail financially or become insolvent.

TIME DEPOSITS -- Time deposits are non-negotiable receipts issued by a bank in
exchange for the deposit of funds. Like a certificate of deposit, it earns a
specified rate of interest over a definite period of time; however, it cannot be
traded in the secondary market. Time deposits are considered to be illiquid
securities.

U.S. GOVERNMENT AGENCIES -- Obligations issued or guaranteed by agencies of the
U.S. Government, including, among others, the Federal Farm Credit Bank, the
Federal Housing Administration and the Small Business Administration, and
obligations issued or guaranteed by instrumentalities of the U.S. Government,
including, among others, the Federal Home Loan Mortgage Corporation, the Federal
Land Banks and the U.S. Postal Service. Some of these securities are supported
by the full faith and credit of the U.S. Treasury (e.g., Government National
Mortgage Association), others are supported by the right of the issuer to borrow
from the Treasury (e.g., Federal Farm Credit Bank), while still others are
supported only by the credit of the instrumentality (e.g., Federal National
Mortgage Association). Guarantees of principal by agencies or instrumentalities
of the U.S. Government may be a guarantee of payment at the maturity of the
obligation so that in the event of a default prior to maturity there might not
be a market and thus no means of realizing on the obligation prior to maturity.
Guarantees as to the timely payment of principal and interest do not extend to
the value or yield of these securities nor to the value of the Fund's shares.
<PAGE>
19

U.S. TREASURY OBLIGATIONS -- U.S. Treasury obligations consist of bills, notes
and bonds issued by the U.S. Treasury and separately traded interest and
principal component parts of such obligations that are transferable through the
Federal book-entry system known as Separately Traded Registered Interest and
Principal Securities ("STRIPS").

VARIABLE AND FLOATING RATE INSTRUMENTS -- Certain obligations may carry variable
or floating rates of interest, and may involve a conditional or unconditional
demand feature. Such instruments bear interest at rates which are not fixed, but
which vary with changes in specified market rates or indices. The interest rates
on these securities may be reset daily, weekly, quarterly or some other reset
period, and may have a floor or ceiling on interest rate changes. There is a
risk that the current interest rate on such obligations may not accurately
reflect existing market interest rates. A demand instrument with a demand notice
exceeding seven days may be considered illiquid if there is no secondary market
for such security.

WARRANTS -- Instruments giving holders the right, but not the obligation, to buy
shares of a company at a given price during a specified period.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES -- When-issued or delayed delivery
basis transactions involve the purchase of an instrument with payment and
delivery taking place in the future. Delivery of and payment for these
securities may occur a month or more after the date of the purchase commitment.
The Fund will maintain with the custodian a separate account with liquid high
grade debt securities or cash in an amount at least equal to these commitments.
The interest rate realized on these securities is fixed as of the purchase date
and no interest accrues to the Fund before settlement. These securities are
subject to market fluctuation due to changes in market interest rates and it is
possible that the market value at the time of settlement could be higher or
lower than the purchase price if the general level of interest rates has
changed. Although a Fund generally purchases securities on a when-issued or
forward commitment basis with the intention of actually acquiring securities for
its portfolio, the Fund may dispose of a when-issued security or forward
commitment prior to settlement if it deems appropriate.

ZERO COUPON OBLIGATIONS -- Zero coupon obligations are debt securities that do
not bear any interest, but instead are issued at a deep discount from par. The
value of a zero coupon obligation increases over time to reflect the interest
accreted. Such obligations will not result in the payment of interest until
maturity, and will have greater price volatility than similar securities that
are issued at par and pay interest periodically.
<PAGE>
(THIS PAGE INTENTIONALLY LEFT BLANK)
<PAGE>
A-1

APPENDIX
I. BOND RATINGS
*CORPORATE BONDS

The following are descriptions of Standard & Poor's Corporation ("S&P's") and
Moody's Investors Service, Inc. ("Moody's") corporate bond ratings.

Bonds rated AAA have the highest rating S&P assigns to a debt obligation. Such a
rating indicates an extremely strong capacity to pay principal and interest.
Bonds rated AA also qualify as high-quality debt obligations. Capacity to pay
principal and interest is very strong, and in the majority of instances they
differ from AAA issues only in small degree. Debt rated A has a strong capacity
to pay interest and repay principal although it is somewhat more susceptible to
the adverse effects of changes in circumstances and economic conditions than
debt in higher rated categories.

Bonds which are rated BBB are considered to be medium-grade obligations (i.e.,
they are neither highly protected nor poorly secured). Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.

Debt rated BB, B, CCC, CC and C is regarded as having predominately speculative
characteristics with respect to capacity to pay interest and repay principal. BB
indicates the least degree of speculation and C the highest degree of
speculation. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposure to adverse conditions.

Bonds which are rated Aaa by Moody's are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edge." Interest payments are protected by a large, or an exceptionally
stable, margin and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues. Bonds rated Aa by
Moody's are judged by Moody's to be of high quality by all standards. Together
with bonds rated Aaa, they comprise what are generally known as high-grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than in Aaa securities.

Bonds which are rated A possess many favorable investment attributes and are to
be considered as upper-medium grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the future.

Debt rated Baa is regarded as having an adequate capacity to pay interest and
repay principal. Whereas it normally exhibits adequate protection parameters,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity to pay interest and repay principal for debt in this
category than in higher rated categories.

Bonds which are rated Ba are judged to have speculative elements; their future
cannot be considered as well-assured. Often the protection of interest and
principal payments may be very moderate and thereby not well safeguarded during
both good and bad times
<PAGE>
A-2
over the future. Uncertainty of position characterizes bonds in this class.
Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small. Bonds
which are rated Caa are of poor standing. Such issues may be in default or there
may be present elements of danger with respect to principal and interest. Bonds
which are rated Ca represent obligations which are speculative in a high degree.
Such issues are often in default or have other marked shortcomings. Bonds which
are rated C are the lowest rated class of bonds and issues so rated can be
regarded as having extremely poor prospects of ever attaining any real
investment standing.

II. COMMERCIAL PAPER AND SHORT-TERM RATINGS

The following descriptions of commercial paper ratings have been published by
S&P, Moody's, Fitch Investors Service, Inc. ("Fitch"), Duff and Phelps ("Duff")
and IBCA Limited ("IBCA"), respectively.

Commercial paper rated A by S&P is regarded by S&P as having the greatest
capacity for timely payment. Issues rated A are further refined by use of the
numbers 1+ and 1. Issues rated A-1+ are those with an "overwhelming degree" of
credit protection. Those rated A-1 reflect a "very strong" degree of safety
regarding timely payment. Those rated A-2 reflect a safety regarding timely
payment but not as high as A-1.

Commercial paper issues rated Prime-1 and Prime-2 by Moody's are judged by
Moody's to have superior ability and strong ability for repayment, respectively.

The rating Fitch-1 (Highest Grade) is the highest commercial rating assigned by
Fitch. Paper rated Fitch-1 is regarded as having the strongest degree of
assurance for timely payment. The rating Fitch-2 (Very Good Grade) is the second
highest commercial paper rating assigned by Fitch which reflects an assurance of
timely payment only slightly less in degree than the strongest issues.

The rating Duff-1 is the highest commercial paper rating assigned by Duff. Paper
rated Duff-1 is regarded as having very high certainty of timely payment with
excellent liquidity factors which are supported by ample asset protection. Risk
factors are minor. Paper rated Duff-2 is regarded as having good certainty of
timely payment, good access to capital markets and sound liquidity factors and
company fundamentals. Risk factors are small.

The designation A1 by IBCA indicates that the obligation is supported by a very
strong capacity for timely repayment. Those obligations rated A1+ are supported
by the highest capacity for timely repayment. Obligations rated A2 are supported
by a strong capacity for timely repayment, although such capacity may be
susceptible to adverse changes in business, economic or financial conditions.
<PAGE>

<TABLE>
<S> <C> <C>
STI CLASSIC FUNDS ORGANIZATIONAL OVERVIEW

* INVESTMENT ADVISOR

STI Capital Management, N.A. P.O. Box 3808
Orlando, FL 32802

* DISTRIBUTOR

SEI Financial Services Company 680 E. Swedesford Road
Wayne, PA 19087-1658

* ADMINISTRATOR

SEI Financial Management 680 E. Swedesford Road
Corporation Wayne, PA 19087-1658

* TRANSFER AGENT

Federated Services Company Federated Investors
Tower
Pittsburgh, PA
15222-3779

* CUSTODIAN

SunTrust Bank, Atlanta c/o STI Trust &
Investment Operations,
Inc.
303 Peachtree Street
N.E., 14th Floor
Atlanta, GA 30308

The Bank of California 475 Sansome Street
(International Equity Index Fund Suite 1200
only) San Francisco, CA 94111

The Bank of New York One Wall Street
(International Equity Fund only) New York, NY 10286

* LEGAL COUNSEL

Morgan, Lewis & Bockius LLP 2000 One Logan Square
Philadelphia, PA 19103

* INDEPENDENT AUDITORS

Arthur Andersen, LLP 1601 Market Street
Philadelphia, PA 19103
</TABLE>
<PAGE>

STI CLASSIC FUNDS

INTERNATIONAL EQUITY FUND
INVESTOR/FLEX CLASS SHARES

Supplement dated May 7, 1996
to Prospectus dated October 1, 1995

The Prospectus dated October 1, 1995 is hereby amended by the addition of
the following unaudited financial information for the International Equity Fund
for the period ended March 31, 1996.

FINANCIAL HIGHLIGHTS STI CLASSIC FUNDS
FOR THE PERIOD ENDED MARCH 31, 1996 (UNAUDITED)

For a Share Outstanding Throughout the Period

- --------------------
INTERNATIONAL
EQUITY FUND
- --------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTOR
1996(1) $10.44 $ - $ 0.43 $ - $10.87 4.12% $2,333 1.81% 0.09% 3.53% (1.63)% 115%

FLEX
1996(1) $10.44 $ (0.01) $ 0.43 $ - $10.86 4.02% $521 2.51% (0.51)% 6.13% (4.13)% 115%

- --------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------------

</TABLE>

(1) Commenced operations on January 2, 1996. All ratios for the period except
total return have been annualized.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE

<PAGE>
STI CLASSIC FUNDS
INVESTOR SHARES
FLEX SHARES
INTERNATIONAL EQUITY FUND

INVESTMENT ADVISOR TO THE FUND:
STI CAPITAL MANAGEMENT, N.A.

The STI Classic Funds (the "Trust") is a mutual fund that offers shares in a
number of separate investment portfolios. This Prospectus sets forth concisely
the information about the Investor Shares and Flex Shares of the International
Equity Fund (the "Fund"). Investors are advised to read this Prospectus and
retain it for future reference.

OCTOBER 31, 1995
AS SUPPLEMENTED DECEMBER 21, 1995
<PAGE>
2

TABLE OF CONTENTS

<TABLE>
<S> <C>
Expense Summary...................... 3
Performance Information.............. 5
The Trust............................ 5
Investment Objective................. 5
Investment Policies and Strategies... 6
General Investment Policies and
Strategies......................... 7
Investment Risks..................... 7
Investment Limitations............... 9
Performance Information.............. 10
General Performance Information...... 10
Purchase of Fund Shares.............. 10
Redemption of Fund Shares............ 15
Fundlink............................. 16
Exchanges............................ 16
Dividends and Distributions.......... 16
Tax Information...................... 17
STI Classic Funds Information........ 18
The Trust............................ 18
Board of Trustees.................... 18
Investment Advisor................... 19
Portfolio Manager.................... 19
Banking Laws......................... 20
Distribution......................... 20
Administration....................... 21
Transfer Agent and Dividend
Disbursing Agent................... 21
Custodian............................ 21
Legal Counsel........................ 22
Independent Public Accountants....... 22
Other Information.................... 22
Voting Rights........................ 22
Reporting............................ 22
Shareholder Inquiries................ 22
Description of Permitted
Investments........................ 22
Appendix............................. A-1
</TABLE>
<PAGE>
3

EXPENSE SUMMARY
INVESTOR SHARES

Below is a summary of the transaction expenses and annual operating expenses for
Investor Shares of the International Equity Fund described in this Prospectus. A
hypothetical example based on the estimated expenses is also shown. Actual
expenses may vary.

<TABLE>
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------------------
Maximum Sales Charge Imposed on Purchases (as a percentage of offering price)... 3.75%
Maximum Sales Charge Imposed on Reinvested Dividends............................ None
Deferred Sales Charge........................................................... None
Redemption Fees(1).............................................................. None
Exchange Fee.................................................................... None
- --------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------
</TABLE>

(1) There is a $7.00 wire charge for redemptions for all funds processed from
retail accounts which require wires to particular banks.

ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)

<TABLE>
<CAPTION>
INTERNATIONAL
EQUITY FUND
<S> <C>
- -----------------------------------------------------------------------------------------------------------------------
Advisory Fees (After Voluntary Reductions)(1)......................................................... 1.10%
All Other Expenses.................................................................................... .41%
12b-1 Service & Distribution Expenses (After Voluntary Reductions).................................... .30%
- -----------------------------------------------------------------------------------------------------------------------
Total Operating Expenses (After Voluntary Reductions)(1).............................................. 1.81%
- -----------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Absent voluntary reductions, advisory fees, service and distribution
expenses, and total operating expenses, expressed as a percentage of average
net assets for the Investor Shares of the Fund would be: 1.25%, 0.33% and
1.99%. Fee reductions are voluntary and may be terminated at any time.
Additional information may be found under "Investment Advisor,"
"Administration," and "Distribution." A person that purchases shares through
an account with a financial institution may be charged separate fees by the
financial institution.

THE EXAMPLE IS BASED UPON THE TOTAL OPERATING EXPENSES OF THE FUND AND SHOULD
NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES. ACTUAL EXPENSES
MAY BE GREATER OR LESS THAN THOSE SHOWN. The purpose of this table is to assist
the investor in understanding the various costs and expenses that may be
directly or indirectly borne by investors in the Trust. "Other Expenses" for the
Fund are based on estimated amounts for the current fiscal year. The information
set forth in the foregoing table and example relates only to Investor Shares.
The Trust also offers Trust Shares and Flex Shares of the Fund which are subject
to the same expenses except there are no distribution fees, different transfer
agent fees or sales charges. The rules of the Securities and Exchange Commission
require that the maximum sales charge be reflected in the above table. However,
certain investors may qualify for reduced sales charges. See "Purchase of Fund
Shares." Long-term Investor Class Shareholders may eventually pay more than the
economic equivalent of the maximum front-end sales charges otherwise permitted
by the National Association of Securities Dealers, Inc.'s Rules of Fair
Practice.
<PAGE>
4

EXPENSE SUMMARY
FLEX SHARES

Below is a summary of the transaction expenses and annual operating expenses for
the Flex Shares of the International Equity Fund. A hypothetical example based
on the estimated expenses is also shown. Actual expenses may vary.

<TABLE>
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------------------
Maximum Sales Charge Imposed
on Purchases (as a percentage of
offering price)................................................................ None
Maximum Sales Charge Imposed
on Reinvested Dividends........................................................ None
Maximum Contingent Deferred
Sales Charge................................................................... 2.00%
Redemption Fees(1).............................................................. None
Exchange Fee.................................................................... None
- --------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------
</TABLE>

(1) There is a $7.00 wire charge for redemptions for all funds processed from
retail accounts which require wires to particular banks.

ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)

<TABLE>
<CAPTION>
INTERNATIONAL
EQUITY FUND
<S> <C>
- -----------------------------------------------------------------------------------------------------------------------
Advisory Fees (After Voluntary Reductions)(1)......................................................... 1.10%
All Other Expenses.................................................................................... .41%
12b-1 Distribution & Service Expenses................................................................. 1.00%
- -----------------------------------------------------------------------------------------------------------------------
Total Operating Expenses (After Voluntary Reductions)(1).............................................. 2.51%
- -----------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Absent voluntary reductions, advisory fees and total operating expenses,
expressed as a percentage of average net assets for the Flex Shares of the
Fund would be 1.25% and 2.66%. Fee reductions are voluntary and may be
terminated at any time. Additional information may be found under
"Investment Advisor," "Administration," and "Distribution." A person that
purchases shares through an account with a financial institution may be
charged separate fees by the financial institution.

<TABLE>
<CAPTION>
INTERNATIONAL
EXAMPLE EQUITY FUND
<S> <C>
- ---------------------------------------------------------------------------------------------------------------------
An investor would pay the following expenses on a $1,000 investment assuming: (1) 5% annual return and
(2) redemption at the end of each time period:
ONE YEAR
Assuming a complete redemption at end of period................................................... $ 45
Assuming no redemptions........................................................................... 25
THREE YEARS
Assuming a complete redemption at end of period................................................... 78
Assuming no redemptions........................................................................... 78
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>

THE EXAMPLE IS BASED UPON THE TOTAL OPERATING EXPENSES OF THE FUND AND SHOULD
NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES. ACTUAL EXPENSES
MAY BE GREATER OR LESS THAN THOSE SHOWN. The purpose of this table is to assist
the investor in understanding the various costs and expenses that may be
directly or indirectly borne by investors in the Trust. "Other Expenses" for the
Fund are based on estimated amounts for the current fiscal year. The information
set forth in the foregoing table and example relates only to Flex Shares. The
Trust also offers Trust Shares and Investor Shares of the Fund which are subject
to the same expenses except for variations in distribution and service fees,
transfer agent fees and sales charges. The rules of the Securities and Exchange
Commission require that the maximum sales charge be reflected in the above
table. However, certain investors may qualify for reduced sales charges. See
"Purchase of Fund Shares." Long-term Flex Shareholders may eventually pay more
than the economic equivalent of the maximum front-end sales charges otherwise
permitted by the National Association of Securities Dealers, Inc.'s Rules of
Fair Practice.
<PAGE>
5

PERFORMANCE INFORMATION FOR PREDECESSOR COLLECTIVE FUND

The International Equity Fund is the successor to a collective investment fund
previously managed by the Advisor. A substantial portion of the assets of this
collective investment fund was transferred to the Fund on December 1, 1995 in
connection with the Fund's commencement of operations. Set forth below is
certain performance data for the predecessor collective investment fund, which
is deemed relevant because the collective investment fund was managed using
virtually the same investment objective, policies and restrictions as those used
by the Fund. However, the performance data is not necessarily indicative of the
future performance of the Fund. The Fund will be somewhat smaller in asset size
than the predecessor collective investment fund. It is anticipated, however,
that the Fund will reach the same or greater asset size as the predecessor fund
before the end of the Fund's first year of operation and will continue to grow
in size thereafter.

INVESTOR SHARES

Total Cumulative Return for the period ended 9/30/95 (adjusted to reflect
current Fund expenses, net of voluntary waivers and reimbursements and the
maximum sales charge of 3.75%.)

FLEX SHARES

Total Cumulative Return for the period ended 9/30/95 (adjusted to reflect
current Fund expenses, net of voluntary waivers and reimbursements and with the
applicable maximum contingent deferred sales charge of 2.00%.)

THE TRUST

STI Classic Funds (the "Trust") is a diversified, open-end management investment
company that provides a convenient and economical means of investing in several
professionally managed portfolios of securities. The Trust currently offers
units of beneficial interest ("shares") in a number of separate Funds.
Shareholders may purchase shares in the International Equity Fund (the "Fund")
through three separate classes (Trust Shares, Investor Shares and Flex Shares)
which provide for variations in distribution and transfer agent fees, voting
rights and dividends. Except for differences between classes, each share of the
Fund represents an undivided, proportionate interest in the Fund. This
Prospectus relates to the Investor Shares and Flex Shares of the Fund.

INVESTMENT OBJECTIVE

THE INTERNATIONAL EQUITY FUND seeks to provide long term capital appreciation by
investing primarily in a diversified portfolio of equity securities of foreign
issuers.
<PAGE>
6

There can be no assurance that the Fund will achieve its investment objective.

The investment objective of the Fund is nonfundamental and may be changed
without shareholder approval.

INVESTMENT POLICIES AND STRATEGIES

INTERNATIONAL EQUITY FUND

The Fund under normal market conditions will invest at least 65% of its assets
in equity securities of foreign issuers consisting of: common and preferred
stocks, warrants, options and securities convertible into common stock.

The annual portfolio turnover rate for the Fund is not expected to exceed 100%.

GENERAL INVESTMENT POLICIES AND STRATEGIES

The Fund may purchase restricted securities, including Rule 144A securities,
that the Advisor determines are liquid pursuant to guidelines established by the
Trust's Board of Trustees.

In the event that a security owned by the Fund is downgraded below the stated
rating categories, the Advisor will review and take appropriate action with
regard to the security.

The Fund's purchase of shares of other investment companies is limited by the
Investment Company Act of 1940 and will ordinarily result in an additional layer
of charges and expenses.

The Fund may engage in securities lending and will limit such practice to 33
1/3% of its total assets.

For additional information regarding permitted investments, see "Description of
Permitted Investments" in this Prospectus and in the Statement of Additional
Information.

INVESTMENT RISKS
FOREIGN SECURITIES AND FOREIGN CURRENCY CONTRACTS

Investing in the securities of foreign companies and the utilization of forward
foreign currency contracts involve special risks and considerations not
typically associated with investing in U.S. companies. These risks and
considerations include differences in accounting, auditing and financial
reporting standards, generally higher commission rates on foreign portfolio
transactions, the possibility of expropriation or confiscatory taxation, adverse
changes in investment or exchange control regulations, political instability
which could affect U.S. investment in foreign countries and potential
restrictions of the flow of international capital and currencies. Foreign
companies may also be subject to less government regulation than U.S. companies.
Moreover, the dividends payable on the foreign
<PAGE>
8
securities may be subject to foreign withholding taxes, thus reducing the net
amount of income available for distribution to the Fund's Shareholders. Further,
foreign securities often trade with less frequency and volume than domestic
securities and, therefore, may exhibit greater price volatility. Changes in
foreign exchange rates will affect, favorably or unfavorably, the value of those
securities which are denominated or quoted in currencies other than the U.S.
dollar.

The Fund's investments in emerging markets can be considered speculative, and
therefore may offer higher potential for gains and losses than investments in
developed markets of the world. With respect to any emerging country, there is
the greater potential for nationalization, expropriation or confiscatory
taxation, political changes, government regulation, social instability or
diplomatic developments (including war) which could affect adversely the
economies of such countries or investments in such countries. In addition, it
may be difficult to obtain and enforce a judgment in the courts of such
countries. The economies of developing countries generally are heavily dependent
upon international trade and, accordingly, have been and may continue to be
adversely affected by trade barriers, exchange controls, managed adjustments in
relative currency values and other protectionist measures imposed or negotiated
by the countries with which they trade. Investment in Eastern European countries
and the countries which made up the former Soviet Union, may be affected by
political decisions that could cause such countries to revert to a prior system
of government.

EQUITY SECURITIES

FIXED INCOME SECURITIES

Securities rated BBB by S&P or Baa by Moody's (investment grade bonds) are
deemed by these rating services to have speculative characteristics.

Guarantees of the Fund's securities by the U.S. Government or its agencies or
instrumentalities guarantee only the payment of principal and interest on the
guaranteed securities, and do not guarantee the securities' yield or value of
the yield or value of the Fund's shares.

There is a risk that the current interest rate on floating and variable rate
instruments may not accurately reflect existing market interest rates.

HIGH YIELD, LOWER RATED BONDS

INVESTMENT LIMITATIONS

The Fund may not:

2. Purchase any securities which would cause more than 25% of the total assets
of the Fund to be invested in the securities of one or more issuers conducting
their principal business activities in the same industry, provided that this
limitation does not apply to investments in obligations issued or guaranteed by
the U.S. Government or its agencies and instrumentalities, repurchase agreements
involving such securities or tax-exempt securities issued by governments or
political subdivisions of governments. For purposes of this limitation, (i)
utility companies will be divided according to their services, for example, gas,
gas transmission, electric and telephone will each be considered a separate
industry; (ii) financial service companies will be classified according to the
end users of their services, for example, automobile finance, bank finance and
diversified finance
<PAGE>
10
will each be considered a separate industry; and (iii) supranational entities
will be considered to be a separate industry.

The foregoing percentages will apply at the time of the purchase of a security.
Additional investment limitations are set forth in the Statement of Additional
Information.

PERFORMANCE INFORMATION

GENERAL PERFORMANCE INFORMATION

The performance of Investor Shares and Flex Shares of the Trust will normally be
lower than for Trust Shares of the Trust because Investor Shares and Flex Shares
are subject to distribution and certain transfer agent fees not charged to Trust
Shares. Because of their differing distribution expense arrangements the
performance of Flex Shares in comparison to Investor Shares will vary depending
upon the investor's investment time horizon.

PURCHASE OF FUND SHARES

Investor Shares and Flex Shares are sold on a continuous basis and may be
purchased through the Trust's Transfer Agent, Federated Services Company (the
"Transfer Agent,") either by mail, by telephone or by wire. Investor Shares and
Flex Shares may also be purchased through Investment Services Representatives of
SunTrust Banks, Inc. affiliate banks which serve as Shareholder Servicing Agents
to the Trust. Furthermore, Investor Shares and Flex Shares may be purchased
through SunTrust Securities, Inc., as well as certain correspondent banks of
SunTrust Banks, Inc.

Shares may be purchased on days on which the New York Stock Exchange is open for
business ("business day").

A purchase order for the Fund will be effective as of the business day it is
received by the Transfer Agent if the Transfer Agent receives the order before
4:00 p.m. Eastern time. Purchases will be made in full and fractional shares of
the Trust calculated to three decimal places. Purchases by mail are considered
received after payment by check is converted into federal funds.

The purchase price of Investor Shares of the Fund is the net asset value next
determined after a purchase order is effective plus any applicable sales charge
(the "offering price").

The purchase price of Flex Shares is the net asset value determined after a
purchase order
<PAGE>
11
is effective. Flex Shares are subject to a deferred sales charge if redeemed
within one year of purchase.

The net asset value per share of the Fund is determined by dividing the total
market value of the Fund's investments and other assets, less any liabilities,
by the total outstanding shares of the Fund. Net asset value per share is
determined daily as of close of business of the New York Stock Exchange
(currently 4:00 p.m. Eastern time) on any business day. Pursuant to guidelines
established by the Trustees, the Trust may use a pricing service to provide
market quotations or valuations for securities owned by the Fund.

Minimum initial and subsequent purchase amounts, respectively, for Investor
Shares of the Fund are $2,000 and $1,000 ($100 via statement coupon) and for
Flex Shares of the Fund $10,000 and $1,000 ($100 via statement coupon).
Employees and their immediate family members (spouses and children under age 21)
of SunTrust Banks, Inc. and its affiliates may establish accounts with a minimum
initial purchase amount of $1,000 for Investor and Flex Shares of the Fund. The
minimum initial purchase amount for retirement plans is $2,000. These minimums
may be waived at the Distributor's discretion, and, in the case of Flex Shares,
may be waived at the Distributor's discretion for any one trust or fiduciary
account including employee benefit plans created under Sections 401 or 457 of
the Internal Revenue Code including related plans of the same employer.

Financial institutions may impose an earlier cut-off time for receipt of
purchase orders directed through them to allow for processing and transmittal of
these orders to the Transfer Agent for effectiveness the same day.

The Trust reserves the right to reject a purchase order when the Distributor
determines that it is not in the best interest of the Trust and/or
Shareholder(s).

Although the methodology and procedures for calculating the net asset value of
Investor, Trust, and Flex Shares are identical, the net asset value per share of
the classes may differ because of the distribution, service, and certain
transfer agent expenses charged to Investor Shares and Flex Shares.

In deciding whether to purchase Investor Shares or Flex Shares, investors should
take into consideration their present and anticipated purchase amounts and time
horizons. Investors should consider, based on the anticipated life of their
investment, whether the accumulated distribution fees and contingent deferred
sales charge on Flex Shares would be less than the initial sales charge on the
Investor Shares purchased at the same time. And, simultaneously and to what
extent such differential would be offset by the higher dividend distributions
per share on the Investor Shares. To assist investors in making this decision,
an analysis program is available through a local SunTrust Trust and Investment
Services representative upon request.
<PAGE>
12

*SYSTEMATIC INVESTMENT PLAN

Investor Shares and Flex Shares of the Fund may be purchased systematically
through deductions from checking or savings accounts maintained through SunTrust
Banks, Inc. affiliate banks. Investors may purchase Investor Shares on a fixed
schedule (semi-monthly or monthly) with amounts from $50 up to $100,000. The
Systematic Investment Plan is subject to minimum initial purchase and subsequent
amounts of $500 and $50, respectively. Minimum maintained balance requirements
are $10,000 (Flex Shares) and $2,000 (Investor Shares). Since the minimum normal
initial investment amount for Flex Shares is $10,000 per Fund, it is expected
that Systematic Investment Plan purchases will total $10,000 per Fund within a
two-year period. The distributor maintains the right to terminate a Systematic
Investment Plan account if the account fails to reach this $10,000 total
cumulative purchase amount within the two-year period. The purchases will be
effective on the business day that the transfer agent receives the transmission.

INVESTOR SHARES
*SALES CHARGE INFORMATION

The following schedule applies to the purchase of Investor Shares of the Fund:

<TABLE>
<CAPTION>
SALES CHARGE AS A SALES CHARGE AS A
PERCENTAGE OF PERCENTAGE OF NET
OFFERING PRICE AMOUNT INVESTED
----------------- ------------------
<S> <C> <C>
Less than $100,000... 3.75% 3.90%
$100,000 but less
than $250,000....... 3.25% 3.36%
$250,000 but less
than $1,000,000..... 2.50% 2.56%
$1,000,000 and
higher.............. 1.50% 1.52%
</TABLE>

Employees and their immediate family members (spouses and children under age 21)
of SunTrust Banks, Inc. and its affiliates, as well as persons investing
distributions from qualified employee benefit retirement plans or rollovers from
Individual Retirement Accounts ("IRAs") previously established with a SunTrust
Banks, Inc. affiliate bank trust department, will be exempt from sales charges
in purchasing Investor Shares. In addition, certain trust accounts for which a
subsidiary bank of SunTrust Banks, Inc. acts in an administrative, fiduciary,
investment advisory, or custodial capacity, will be exempt from sales charges
and be placed in Trust Shares.

When accounts for which a subsidiary bank of SunTrust Banks, Inc. has acted in a
fiduciary, administrative, custodial or investment advisory capacity are closed
and Investor Shares purchased, the Investor Shares that are purchased in an
amount equal to or lesser than the value of the account distribution will be
exempt from sales charges. Any subsequent purchases will be subject to the
applicable sales charge.

Purchases of STI Classic Funds Investor Shares through a SunTrust Banks, Inc.
affiliate bank's asset allocation account will be exempt from sales charges.

Dealers may be reallowed the entire sales charge imposed on purchases of
Investor Shares and may, therefore, be deemed "underwriters" for purposes of the
Securities Act of 1933.

*RIGHTS OF ACCUMULATION

In calculating the sales charge rates applicable to current purchases of the
Fund's Investor Shares by a "single purchaser," the Trust will cumulate current
purchases at the offering price with the current market value of previously
purchased Investor Shares of any Trust's non-Money Market Funds ("Eligible
Funds") which are sold subject to a sales charge.

The term "single purchaser" refers to (i) an individual, (ii) an individual and
spouse
<PAGE>
13
purchasing shares of an Eligible Fund for their own account or for trust or
custodial accounts for their minor children, or (iii) a fiduciary purchasing for
any one trust, estate or fiduciary account, including employee benefit plans
created under Sections 401 or 457 of the Internal Revenue Code, including
related plans of the same employer. Furthermore, under this provision, purchases
by a "single purchaser" shall include purchases by an individual for his/her own
account in combination with (i) purchases of that individual and spouse for
their joint account or for trust and custodial accounts for their minor children
and (ii) purchases of that individual's spouse for his/her own account. To be
entitled to a reduced sales charge based upon shares already owned, the investor
must ask the Distributor for such reduction at the time of purchase and provide
the account number(s) of the investor, the investor and spouse, and their
children (under age 21), and give the ages of such children. The Fund may amend
or terminate this right of accumulation at any time as to subsequent purchases.

*LETTER OF INTENT

By submitting a Letter of Intent to the Transfer Agent, a "single purchaser" may
purchase Investor Shares of a non-Money Market Fund during a 13-month period at
the reduced sales charge rates applicable to the aggregate amount of the
intended purchases stated in the Letter. The Letter may apply to purchases made
up to 90 days before the date of the Letter. The purchase price for these prior
trades will not be adjusted.

A written Letter of Intent provided to the Transfer Agent, is not legally
binding on the signer or the Fund, and provides for the holding in escrow by the
transfer agent of 3.75% of the total amount intended to be purchased until such
purchase is completed within the 13-month period. A Letter of Intent may be
dated to include shares purchased up to 90 days prior to the date the Letter is
signed. The 13-month period begins on the date of the earliest purchase. If the
intended investment is not completed, the Transfer Agent will surrender an
appropriate number of the escrowed shares for redemption in order to realize the
difference between the sales charge on the shares purchased at the reduced rate
and the sales charge otherwise applicable to the total shares purchased.

*COMBINED PURCHASE/QUANTITY DISCOUNT PRIVILEGE

The Trust will combine purchases of Investor Shares of Eligible Funds made on
the same day by the investor, his/her spouse, and his/her children under age 21
when calculating the sales charge. This combination may also apply to purchases
made pursuant to a Letter of Intent. Purchases made by such persons over a 13
month period could thus qualify the entire purchase for a reduced sales charge.

*SPECIAL DIVIDEND SERVICES

Dividend distributions made by the Fund can be automatically reinvested in
Investor Shares of any one Fund of the Trust without a sales charge, subject to
account minimum initial purchase amounts and minimum maintained balance
requirements.

*REPURCHASE OF FUND SHARES

Investor Shares of the Fund may be purchased at their net asset value if such
Investor Shares, sold subject to a sales charge were redeemed from the Fund
within the past 60 days. The amount which may be reinvested is limited to an
amount up to but not exceeding the redemption proceeds. In order to exercise
this privilege a written order for the purchases must
<PAGE>
14
be received by the Transfer Agent within 60 days after the redemption. It is the
responsibility of the investor to notify the Transfer Agent at the time of
repurchase.

FLEX SHARES
*CONTINGENT DEFERRED SALES CHARGE INFORMATION

Flex Shares of the Fund may be purchased at their net asset value. Shares
redeemed within the first year after purchase will be subject to a contingent
deferred sales charge ("CDSC") equal to 2.00% of the lesser of the net asset
value of the shares at the time of purchase or the net asset value of the shares
at the time of redemption, in accordance with the following schedule:

<TABLE>
<CAPTION>
CONTINGENT DEFERRED SALES
CHARGE AS A PERCENTAGE OF
YEAR SINCE DOLLAR AMOUNT SUBJECT TO
PURCHASE CHARGE
----------- ---------------------------
<S> <C> <C>
First 2.00%
Second None
</TABLE>

The CDSC will not apply to shares purchased through reinvestment of dividends or
capital gain distributions, accordingly, no sales charge is imposed on increases
in net asset value above the initial purchase price. In determining whether a
particular redemption is subject to a CDSC, it is assumed that the redemption is
first of shares held for over one year or shares acquired through reinvestment
of dividends or other distributions. No CDSC will be charged on exchanges of
Flex Shares of the Fund for Flex Shares of any other Fund. See "Exchanges." In
determining the amount of the Flex Shares CDSC that applies, all purchases shall
be considered as having been made on the trade date.

The contingent deferred sales charge will not be imposed when a redemption
occurs under the following circumstances: (i) a total or partial distribution
from a qualified plan, other than an IRA, Keogh Plan, or a custodial account
following retirement; (ii) a total or partial distribution from an IRA, Keogh
Plan, or a custodial account after the beneficial owner or participant attains
age 59 1/2 or (iii) from the death or complete disability (as defined in the
Internal Revenue Code or evidenced by a certificate from the U.S. Social
Security Administration) of the beneficial owner or participant. The exemption
from the contigent deferred sales charge for qualified plans, an IRA, Keogh
Plan, or a custodial account does not extend to account transfers, rollovers,
and other redemptions made for purposes of reinvestment. Contingent deferred
sales charges are not charged in connection with exchanges of shares for shares
in other STI Classic Fund Flex Shares or in connection with redemptions by the
Fund of accounts with low balances.
<PAGE>
15

REDEMPTION OF FUND SHARES

Shareholders may redeem their Investor Shares or Flex Shares on any day that net
asset value is calculated. Investor Shares and Flex Shares may ordinarily be
redeemed by mail or telephone request to the Transfer Agent. All redemption
orders are effected at the net asset value per share next determined after
receipt of a valid redemption request, reduced by any applicable CDSC for Flex
Shares. See "FLEX SHARES -- Sales Charge Information."

All or part of a shareholder's holdings of Investor Shares or Flex Shares may be
redeemed in accordance with instructions and limitations pertaining to his or
her account. Redemption orders must be received by the Transfer Agent before
4:00 p.m. Eastern time on any business day. Redemption proceeds are remitted
within five days following receipt of the order.

Requests for redemptions from the Fund may be placed in writing or by telephone
directly to an Investment Services Representative of a SunTrust Banks, Inc.
affiliate bank, through SunTrust Securities, Inc., and through certain
correspondent banks of SunTrust Banks, Inc. (or via FUNDLINK to the Transfer
Agent). Redemptions placed via telephone or FUNDLINK (1-800-428-6970) can only
be placed for a minimum of $1,000.

Redemption proceeds can be wired, distributed by check, or transferred to a
Shareholder's account via FUNDLINK. There will be a $7.00 wire charge for
redemptions processed from accounts which require wires to particular banks.

When Investor Shares or Flex Shares are purchased by check or through ACH the
proceeds from the redemption of those Shares are not available, and the Shares
may not be exchanged, until the Trust or its agents are reasonably certain that
the purchase check has cleared, which could take up to 7 business days.

A Shareholder may be required to redeem Investor Shares or Flex Shares if the
balance in a Shareholder's Fund account drops below $2,000 for Investor Shares
and $10,000 for Flex Shares as a result of redemptions and the Shareholder does
not increase its balance to at least $2,000 for Investor Shares and $10,000 for
Flex Shares on 60 days' written notice. The minimum account balance for
employees of SunTrust Banks, Inc. and its affiliates is $1,000. The Trust
intends to pay cash for all shares redeemed, but under abnormal conditions which
make payment in cash unwise, payment may be made wholly or partly in liquid
portfolio securities with a market value equal to the redemption price. In such
cases, an investor may incur brokerage costs in converting such securities to
cash.

Redemptions of $25,000 or greater must be in writing and a signature guarantee
must accompany the written request.

*SYSTEMATIC WITHDRAWAL PLAN

A systematic withdrawal plan can be established for any Fund account with a
$10,000 minimum balance. Under the plan, redemptions can be automatically
processed (monthly, quarterly, semi-annually or annually) by check or through an
electronic transfer to a Shareholder's SunTrust Banks, Inc. affiliate bank
account with a minimum redemption amount of $50.

Because regular, systematic withdrawals of Flex Shares made within one year of
purchase will be subject to the CDSC, it may not be in the best interest of Flex
shareholders to participate in the Systematic Withdrawal Plan. Exceptions
<PAGE>
16
relating to Flex Share systematic withdrawals from qualified retirement plans
were previously referenced.

FUNDLINK

All purchases and redemptions of Investor Shares and Flex Shares may be
completed via FUNDLINK, a telephone activated service that allows Shareholders
to transfer money between the STI Classic Funds and a Shareholder's bank
account(s). To initiate a FUNDLINK transaction, Shareholders are provided a
toll-free telephone number (1-800-428-6970) to call the Trust's Transfer Agent.
To utilize this service, a Shareholder must contact an Investment Services
Representative of a SunTrust Banks, Inc. affiliate bank and complete the
appropriate application and authorization agreements.

EXCHANGES

Some or all of the Investor Shares of the Fund for which payment has been
received (i.e., an established account) may be exchanged for Investor Shares of
other Funds within the Trust. Shares being exchanged for the first time from a
Money Market Fund into a Fund with a sales charge will be subject to the sales
charge of that Fund. Likewise, Shares being exchanged for the first time into a
Fund with a higher sales charge will be subject to an incremental sales charge.
Exchanges made from a Fund with a higher sales charge to a Fund with a lower
sales charge or a Money Market Fund are made without a sales charge.

Flex Shares of the Fund may be exchanged at net asset value only for Flex Shares
of the other Funds of the Trust or for Investor Shares of the Money Market Funds
of the Trust. No CDSC will be imposed on redemptions of Money Market Fund Shares
acquired in an exchange, provided they are held for at least one year from the
initial purchase date of the Flex Shares or are exchanged back into Flex Shares.
Subsequent exchanges of Investor Shares of the Money Market Funds (which were
acquired in an exchange of Flex Shares) may be only for Flex Shares of the
Equity or Fixed Income Funds.

Flex Shares owned by qualifying investors may be exchanged for Trust Shares
(Shares for which SunTrust Banks, Inc. or one of its affiliates acts in a
fiduciary, agency, investment advisory or custodial capacity) at net asset
value. Trust Shares acquired in an exchange of Flex Shares will not be subject
to a CDSC upon redemption.

Four exchanges may be made per calendar year. More than four exchanges in a year
may be considered an abuse of the exchange privilege. The Fund reserves the
right to charge a $10.00 fee for each exchange. A Shareholder with more than
four exchanges per year will be notified prior to the imposition of any such
fee. Exchanges may be requested through an Investment Services Representative of
a SunTrust Banks, Inc. affiliate bank, SunTrust Securities, Inc. and certain
correspondent banks of SunTrust Banks, Inc., either by telephone or in writing,
(or via FUNDLINK through the Fund's Transfer Agent). The minimum exchange amount
is $1,000 subject to account minimum initial purchase amounts and minimum
maintained balance requirements. This exchange offer is subject to change or
termination by the Trust upon sixty days' notice.

DIVIDENDS AND DISTRIBUTIONS

Dividends are declared and paid annually by the Fund. The Fund's net realized
capital gains (including net short-term capital gains) are distributed at least
annually. Net income for dividend purposes consists of (i) interest
<PAGE>
17
accrued and original issue discount earned on the Fund's assets, (ii) plus the
amortization of market discount and minus the amortization of market premium on
such assets, (iii) plus dividend or distribution income on such assets, (iv)
less accrued expenses directly attributable to the Fund and the general expenses
of the Trust prorated to the Fund on the basis of its relative net assets.
Shareholders of record on the record date will be entitled to receive dividends.

The net asset value of Investor Shares or Flex Shares of the Fund will be
reduced by the amount of any dividend or distribution. Dividends and
distributions are paid in the form of additional Investor Shares or Flex Shares
of the Fund unless the customer has elected prior to the date of distribution to
receive payment in cash. Such election, or any revocation thereof, must be made
in writing prior to the date of distribution to the Trust's transfer agent and
will become effective with respect to dividends paid after its receipt.
Dividends and distributions are paid within ten days of the end of the time
period to which the dividend relates. Dividends and distributions payable to a
Shareholder are paid in cash within ten business days after a Shareholder's
complete redemption of its Shares in the Fund.

The amount of dividends payable on Investor Shares and Flex Shares will be less
than the dividends payable on Trust Shares because of the distribution and
certain transfer agent expenses charged to Investor Shares and Flex Shares. The
amount of dividends payable on Flex Shares generally will be less than the
amount of dividends payable on Investor Shares due to the higher distribution
and service expenses of Flex Shares.

TAX INFORMATION

TAX STATUS OF THE FUND:

TAX STATUS OF DISTRIBUTIONS:

The Fund will distribute substantially all of its net investment income
(including, for this purpose, net short-term capital gains) to Shareholders.
Dividends from net investment income paid by the Fund will be taxable to
Shareholders as ordinary income whether received in cash or in additional
shares. Dividends from net investment income will qualify for the dividends
received deduction for corporate Shareholders only to the extent such
<PAGE>
18
distributions are derived from dividends paid by domestic corporations. Any net
capital gains will be distributed annually and will be taxed to Shareholders as
long-term capital gains, regardless of how long the Shareholder has held shares
and regardless of whether distributions are received in cash or in additional
shares. For certain individual Shareholders, net long-term capital gains may be
taxed at a lower rate than ordinary income. The Fund will make annual reports to
Shareholders of the federal income tax status of all distributions. Dividends
declared by the Fund in October, November or December of any year and payable to
Shareholders of record on a date in that month will be deemed to have been paid
by the Fund and received by the Shareholder on December 31 of that year, if paid
by the Fund at any time during the following January.

Sale, exchange or redemption of Fund shares is a taxable event to the
Shareholder.

STI CLASSIC FUNDS INFORMATION
THE TRUST

BOARD OF TRUSTEES

INVESTMENT ADVISOR

The Advisor is an indirect wholly-owned subsidiary of SunTrust Banks, Inc.
("SunTrust"), a southeastern regional bank holding company with assets of $44.2
billion as of June 30, 1995. SunTrust ranks among the twenty largest U.S.
banking companies. Its three principal subsidiaries-- SunTrust Banks of Florida,
Inc., SunTrust Banks of Georgia, Inc. and SunTrust Banks of Tennessee--provide a
wide range of personal and corporate banking, trust, and investment services
through more than 600 locations in the three-state area. Total discretionary
assets under management with SunTrust Banks, Inc. equalled approximately $42
billion as of December 31, 1994.

The Trust and the Advisor have entered into an advisory agreement (the "Advisory
Agreement"). Under the Advisory Agreement, the Advisor makes the investment
decisions for the assets of the Fund, and continuously reviews, supervises and
administers the Fund's investment program. The Advisor discharges its
responsibilities subject to the supervision of, and policies established by, the
Trustees of the Trust. STI CLASSIC FUNDS ARE NOT DEPOSITS, ARE NOT INSURED OR
GUARANTEED BY THE FDIC OR ANY OTHER GOVERNMENT AGENCY, AND ARE NOT ENDORSED OR
GUARANTEED BY AND DO NOT CONSTITUTE OBLIGATIONS OF SUNTRUST BANKS, INC. OR ANY
OF ITS AFFILIATES. INVESTMENTS IN THE FUND INVOLVES RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL. RETURNS AND PRINCIPAL VALUES WILL FLUCTUATE AND SHARES AT
REDEMPTION MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THERE IS NO
GUARANTEE THAT THE FUND WILL ACHIEVE ITS INVESTMENT OBJECTIVE. With respect to
the Fund, the Advisor may execute brokerage or other agency transactions through
affiliates of the Advisor.

For the services provided and expenses incurred pursuant to the Advisory
Agreement, STI Capital is entitled to receive advisory fees computed daily and
paid monthly at the annual rate of 1.25% of the average daily net assets of the
Fund.

Although the advisory fee for the Fund is higher than advisory fees paid by
other mutual funds, the Trust believes that the fee is comparable to the
advisory fee paid by other mutual funds with similar investment objectives and
policies. From time to time, the Advisor may waive (either voluntarily or
pursuant to applicable state limitations) the advisory fee payable by the Fund.
Currently, the Advisor and the Distributor have agreed to voluntary reductions
in their respective fees as well as reductions in service and distribution fees
in amounts necessary to maintain the total operating expenses at the amounts set
forth in the Expense Summary. Voluntary reductions of fees may be terminated at
anytime.

PORTFOLIO MANAGER

Mr. Dan Jaworski has been responsible for the day-to-day management of the Fund
since its inception. Mr. Jaworski joined STI Capital in 1995. Prior to joining
STI Capital he managed international portfolios at Lazard Freres Asset
Management from 1993 through 1994 and the Principal Financial Group from 1988
through 1993.
<PAGE>
20

BANKING LAWS

Banking laws and regulations, including the Glass-Steagall Act as presently
interpreted by the Board of Governors of the Federal Reserve System, presently
(a) prohibit a bank holding company registered under the Federal Bank Holding
Company Act of 1956 or its affiliates from sponsoring, organizing, controlling,
or distributing the shares of a registered, open-end investment company
continuously engaged in the issuance of its shares, and generally prohibit banks
from underwriting securities, but (b) do not prohibit such a bank holding
company or affiliate or banks generally from acting as an investment advisor,
transfer agent, or custodian to such an investment company or from purchasing
shares of such a company as agent for and upon the order of a customer. The
Advisor believes that it may perform the services for the Fund contemplated by
its agreement described in this Prospectus without violation of applicable
banking laws or regulations. However, future changes in legal requirements
relating to the permissible activities of banks and their affiliates, as well as
future interpretations of present requirements, could prevent the Advisor from
continuing to perform services for the Fund. If the Advisor was prohibited from
providing services to the Fund, the Board of Trustees would consider selecting
other qualified firms. Any new investment advisory agreements would be subject
to Shareholder approval.

DISTRIBUTION

SEI Financial Services Company (the "Distributor"), a wholly-owned subsidiary of
SEI Corporation ("SEI"), and the Trust, are parties to a Distribution Agreement
("Distribution Agreement") dated November 21, 1995. The Investor Shares of the
Fund have a distribution plan ("Investor Plan") and the Flex Shares of the Fund
have a distribution plan ("Flex Plan").

The Distribution Agreement and the Investor Plan provide that the Investor
Shares of the Fund may pay a distribution services fee to the Distributor of up
to .33% of its average daily net assets. The Distribution Agreement and the Flex
Plan provide that the Flex Shares of the Fund may pay a distribution services
fee to the Distributor of up to .75% of the average daily net assets of the Flex
Shares of the Fund. Flex Shares are also subject to a service fee of up to .25%
of the average daily net assets of the Flex Shares of each Fund. This service
fee may be used for personal service and maintenance of shareholder accounts.
Asset-based charges such as those incurred by the Flex Shares are designed to
permit an investor to purchase Fund Shares without the assessment of a front-end
sales charge.

The Distributor will waive all or a portion of the distribution fee in order to
limit the net expenses of the Investor Shares to the amounts set forth under
"Expense Summary." The Distributor may apply this fee toward:
<PAGE>
21
(a) compensation for its services in connection with distribution assistance or
provision of shareholder services; or (b) payments to financial institutions and
intermediaries such as banks (including SunTrust Banks, Inc.'s affiliate banks),
savings and loan associations, insurance companies, and investment counselors,
broker-dealers, and the Distributor's affiliates and subsidiaries as
compensation for services, reimbursement of expenses incurred in connection with
distribution assistance, or provision of Shareholder services.

Both the Investor Plan and the Flex Plan are characterized as compensation plans
since the distribution fee will be paid to the Distributor without regard to the
distribution or shareholder service expenses incurred by the Distributor or the
amount of payments made to financial institutions and intermediaries. SunTrust
Banks, Inc.'s affiliate banks and certain correspondent banks may serve as
shareholder servicing agents to the Trust. A prospective investor may visit any
one of the Investment Services offices of the SunTrust Banks, Inc.'s affiliate
banks, as listed on the last pages of the Prospectus, SunTrust Securities, Inc.
or certain correspondent banks of SunTrust Banks, Inc. to receive copies of the
Prospectuses for the Investor Shares or Flex Shares of the Trust and application
forms. Trust Shares of the Fund are offered without a sales charge or a
distribution fee primarily to institutional investors, including affiliates and
correspondents for the investment of funds in which they act in a fiduciary,
agency, investment advisory or custodial capacity. The Flex Shares of the Fund
pay a distribution services fee to the Distributor and are also subject to a
service fee for personal service and maintenance of shareholder accounts. The
initial sales charge option of the Investor Shares provides investors with an
alternative purchase arrangement to Flex Shares. It is possible that a financial
institution may offer different classes of shares to its customers and thus
receive different compensation with respect to different classes of shares.

The Fund may also execute brokerage or other agency transactions through the
Distributor, for which the Distributor receives compensation.

ADMINISTRATION

The Administrator is entitled to a fee, which is calculated daily and paid
monthly, at an annual rate as follows:

TRANSFER AGENT AND DIVIDEND DISBURSING AGENT

Federated Services Company, Pittsburgh, PA is the Transfer Agent for the shares
of the Trust and dividend disbursing agent for the Trust.

CUSTODIAN

SunTrust Bank, Atlanta, c/o STI Trust & Investment Operations, Inc., 303
Peachtree Street N.E., 14th Floor, Atlanta, GA 30308, serves as Custodian of the
assets of each
<PAGE>
22
Fund of the Trust with the exception of the International Equity Index Fund and
the International Equity Fund. The Bank of California, 475 Sansome Street, Suite
1200, San Francisco, CA 94111, serves as Custodian for the International Equity
Index Fund. The Bank of New York, One Wall Street, New York, NY 10286, serves as
Custodian for the International Equity Fund. The Custodians hold cash,
securities and other assets of the Trust as required by the Investment Company
Act of 1940.

LEGAL COUNSEL

Morgan, Lewis & Bockius LLP, Philadelphia, PA, serves as legal counsel to the
Trust.

INDEPENDENT PUBLIC ACCOUNTANTS

The independent public accountants to the Trust are Arthur Andersen, LLP,
Philadelphia, PA.

OTHER INFORMATION
VOTING RIGHTS

REPORTING

The Trust issues unaudited financial information semi-annually and audited
financial statements annually. The Trust furnishes proxy statements and other
reports to Shareholders of record.

SHAREHOLDER INQUIRIES

Shareholders may contact the Transfer Agent in order to obtain information on
account statements, procedures and other related information by calling
1-800-428-6970.

DESCRIPTION OF PERMITTED INVESTMENTS

AMERICAN DEPOSITARY RECEIPTS ("ADRs") -- ADRs are securities, typically issued
by a U.S. financial institution (a "depositary"), that evidence ownership
interests in a security or a pool of securities issued by a foreign issuer and
deposited with the depositary. ADRs may be available through "sponsored" or
"unsponsored" facilities. A sponsored facility is established jointly by the
issuer of the security underlying the receipt and a depositary, whereas an
unsponsored facility may be established by a depositary without participation by
the issuer of the underlying security. Holders of unsponsored depositary
receipts generally bear all the costs of the unsponsored facility. The
depositary of an unsponsored facility frequently is under no obligation to
distribute shareholder communications received from the issuer of the deposited
security or to pass through, to the holders of the receipts, voting rights with
respect to the deposited securities.

CERTIFICATES OF DEPOSIT -- Certificates of deposit are interest bearing
instruments with a specific maturity. They are issued by banks and savings and
loan institutions in exchange for the deposit of funds and normally can be
traded in the secondary market prior to maturity. Certificates of deposit with
penalties for early withdrawal will be considered illiquid.

CORPORATE DEBT OBLIGATIONS -- Debt instruments issued by corporations with
maturities exceeding 270 days. Such instruments may include putable corporate
bonds and zero coupon bonds.

FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS -- Futures contracts provide
for the future sale by one party and purchase by another party of a specified
amount of a specific security at a specified future time and at a specified
price. An option on a futures contract gives the purchaser the right, in
exchange for a premium, to assume a
<PAGE>
24
position in a futures contract at a specified exercise price during the term of
the option. The Fund may use futures contracts and related options for bona fide
hedging purposes, to offset changes in the value of securities held or expected
to be acquired, to minimize fluctuations in foreign currencies, or to gain
exposure to a particular market or instrument. The Fund will minimize the risk
that it will be unable to close out a futures contract by only entering into
futures contracts which are traded on national futures exchanges.

RESTRICTED SECURITIES -- Restricted securities are securities that may not be
sold freely to the public absent registration under the Securities Act of 1933
or an exemption from
<PAGE>
25
registration. Rule 144A securities are securities that have not been registered
under the Securities Act of 1933, but which may be traded between certain
institutional investors, including investment companies. The Trust's Board of
Trustees is responsible for developing guidelines and procedures for determining
the liquidity of restricted securities and monitoring the Advisors'
implementation of the guidelines and procedures.

VARIABLE AND FLOATING RATE INSTRUMENTS -- Certain obligations may carry variable
or floating rates of interest, and may involve a conditional or unconditional
demand feature. Such instruments bear interest at rates which are not fixed, but
which vary with changes in specified market rates or indices. The interest rates
on these securities may be reset daily, weekly, quarterly or some other reset
period, and may have a floor or ceiling on interest rate changes. There is a
risk that the current interest rate on such obligations may not accurately
reflect existing market interest rates. A demand instrument with a demand
<PAGE>
26
notice exceeding seven days may be considered illiquid if there is no secondary
market for such security.

WARRANTS -- Instruments giving holders the right, but not the obligation, to buy
shares of a company at a given price during a specified period.

APPENDIX
I. BOND RATINGS
*CORPORATE BONDS

The following are descriptions of Standard & Poor's Corporation ("S&P")and
Moody's Investors Service, Inc. ("Moody's") corporate bond ratings.

Bonds which are rated Ca represent obligations which are speculative in a high
degree. Such issues are often in default or have other marked shortcomings.
Bonds which are rated C are the lowest rated class of bonds and issues so rated
can be regarded as having extremely poor prospects of ever attaining any real
investment standing.

II. COMMERCIAL PAPER AND SHORT-TERM RATINGS

The following descriptions of commercial paper ratings have been published by
S&P, Moody's, Fitch Investors Service, Inc. ("Fitch"), Duff and Phelps ("Duff")
and IBCA Limited ("IBCA"), respectively.

Commercial paper issues rated Prime-1 and Prime-2 by Moody's are judged by
Moody's to have superior ability and strong ability for repayment, respectively.

FLORIDA: (STATEWIDE TOLL FREE) 1-800-526-1177

SUNTRUST BANK, CENTRAL FLORIDA, N.A.
200 S. Orange Avenue
Tower 10
Orlando, FL 32801
(407) 237-4380
1-800-432-4760, ext. 4380

SUNTRUST BANK, SOUTH FLORIDA, N.A.
501 E. Las Olas Boulevard
Ft. Lauderdale, FL 33301
(305) 765-7422

Boca Raton Office
800 S. Federal Highway
Boca Raton, FL 33435
(407) 243-6707

Coral Ridge Office
2626 E. Oakland Park Blvd.
Ft. Lauderdale, FL 33306
(305) 765-2155

Delray Beach Office
302 E. Atlantic Avenue
Delray Beach, FL 33483
(407) 243-6750

Hollywood Office
2001 Hollywood Blvd.
Hollywood, FL 33021
(305) 765-7062

PGA Office
4500 PGA Blvd.
Palm Beach Gardens, FL 33410
(407) 835-2802

SUNTRUST BANK, MIAMI, N.A.
777 Brickell Avenue
Miami, FL 33131
(305) 579-7450

SUNTRUST BANK, TAMPA BAY
401 E. Jackson Street
Tampa, FL 33602
(813) 224-2517

SUNTRUST BANK, TREASURE COAST, N.A.
700 Virginia Avenue
Ft. Pierce, FL 34982
(407) 467-6459

Osceola Office
111 East Osceola Street
Stuart, FL 34994
(407) 223-6012

SUNTRUST BANK, EAST CENTRAL FLORIDA
Holly Hill Office
1510 Ridgewood Avenue
Holly Hill, FL 32117
(904) 258-2660

West Port Orange Office
4900 Clyde Morris Blvd.
Port Orange, FL 32119
(904) 258-2654

Deland Office
302 E. New York Avenue
Deland, FL 32724
(904) 822-5891

SUNTRUST BANK, NORTH FLORIDA, N.A.
200 W. Forsyth Street
Jacksonville, FL 32202
(904) 632-2534

SUNTRUST BANK, SOUTHWEST FLORIDA
12730 New Brittany Blvd.
Ft. Myers, FL 33907
(941) 277-2531

Pelican Bay Office
801 Laurel Oak Drive
Naples, FL 33963
(941) 598-0517

SUNTRUST BANK, GULF COAST
South Gate Office
3400 S. Tamiami Trail
Sarasota, FL 34230
(941) 316-4027
<PAGE>
Port Charlotte Office
18501 Murdock Circle
Port Charlotte, FL 33949
(941) 625-9286

North Beneva Office
3577 Fruitville Road
Sarasota, FL 34237
(941) 316-4003

South Beneva Office
8181 S. Tamiami Trail
Sarasota, FL 34231
(941) 927-7903

Venice Office
200 Nokomis Avenue South
Venice, FL 34285
(941) 486-4417

SUNTRUST BANK, MID-FLORIDA, N.A.
210 Security Square
Winter Haven, FL 33880
(941) 297-6855

Okeechobee Office
815 S. Parrott Avenue
Okeechobee, FL 34974
(941) 763-1903

SUNTRUST BANK, NATURE COAST
One East Jefferson Street
Brooksville, FL 34601
(904) 754-5798

Regency Park Office
10290 Regency Park Blvd.
Port Richey, FL 34668
(813) 861-4375

Seven Hills Office
1170 Mariner Blvd.
Spring Hill, FL 34609
(904) 754-5779

SUNTRUST BANK, NORTH CENTRAL FLORIDA
203 E. Silver Springs Blvd.
Ocala, FL 34470
(904) 368-6477

200 West Office
929 SW State Road 200
Ocala, FL 34481
(904) 368-6472

SUNTRUST BANK, TALLAHASSEE, N.A.
3522 Thomasville Road
Tallahassee, FL 32312
(904) 298-5064

SUNTRUST BANK, WEST FLORIDA
220 W. Garden Street
Pensacola, FL 32501
(904) 435-1262

Gulf Breeze Office
11 Hoffman Drive
Gulf Breeze, FL 32561
(904) 934-6072

GEORGIA:

SUNTRUST BANK, ATLANTA
55 Park Place
First Floor
Atlanta, GA 30303
(404) 588-7315
1-800-241-0901 Ext. 7315

SUNTRUST BANK, NORTHEAST GEORGIA, N.A.
101 N. Lumpkin Street
Athens, GA 30601
(706) 354-5346

Gainesville Branch
104 Green Street
Gainesville, GA 30503
(770) 503-8674

SUNTRUST BANK, NORTHWEST GEORGIA, N.A.
100 East Second Avenue
Rome, GA 30161
(706) 236-4325

SUNTRUST BANK, AUGUSTA, N.A.
2815 Wrightsboro Road
Augusta, GA 30909
(706) 821-2015

SUNTRUST BANK, MIDDLE GEORGIA, N.A.
606 Cherry Street
Macon, GA 31208
(912) 755-5175

SUNTRUST BANK, WEST GEORGIA, N.A.
1246 First Avenue
Columbus, GA 31901
(706) 649-3631
<PAGE>
SUNTRUST BANK, SAVANNAH, N.A.
33 Bull Street
Savannah, GA 31401
(912) 944-1165

SUNTRUST BANK, SOUTH GEORGIA, N.A.
401 W. Broad Avenue
Albany, GA 31701
(912) 430-5468

Coffee County Branch
201 S. Peterson Avenue
Douglas, GA 31533
(912) 384-1820

SUNTRUST BANK, SOUTHEAST GEORGIA, N.A.
510 Gloucester Street
Brunswick, GA 31520
(912) 262-5322

Sea Island Road Branch
701 Sea Island Road
St. Simons Island, GA 31522
(912) 638-3620
(912) 262-2227

TENNESSEE:

SUNTRUST BANK, NASHVILLE, N.A.
424 Church Street
4th Floor
Nashville, TN 37230
(615) 748-4477
1-800-932-2652

SUNTRUST BANK, CHATTANOOGA, N.A.
736 Market Street
Chattanooga, TN 37402
(615) 757-3085
TN WATS 1-800-572-7306, Ext. 3085
Bordering States WATS
1-800-874-1083, Ext. 3085

SUNTRUST BANK, EAST TENNESSEE, N.A.
700 East Hill Avenue
Knoxville, TN 37997
(423) 544-2201
1-800-442-3487

SUNTRUST BANK, NORTHEAST TENNESSEE
207 Mockingbird Lane
Johnson City, TN 37604
(423) 461-1005

SUNTRUST BANK, SOUTH CENTRAL
TENNESSEE, N.A.
25 Public Square
Lawrenceburg, TN 38464
(615) 762-3511

ALABAMA:

SUNTRUST BANK, ALABAMA, N.A.
201 South Court Street
Florence, AL 35630
(205) 767-8463
<PAGE>

<TABLE>
<S> <C> <C>
STI CLASSIC FUNDS ORGANIZATIONAL OVERVIEW

* INVESTMENT ADVISOR

STI Capital Management, N.A. P.O. Box 3808
Orlando, FL 32802

* DISTRIBUTOR

SEI Financial Services Company 680 E. Swedesford Road
Wayne, PA 19087-1658

* ADMINISTRATOR

SEI Financial Management 680 E. Swedesford Road
Corporation Wayne, PA 19087-1658

* TRANSFER AGENT

Federated Services Company Federated Investors Tower
Pittsburgh, PA 15222-3779

* CUSTODIAN

SunTrust Bank, Atlanta c/o STI Trust &
Investment Operations, Inc.
303 Peachtree Street, N.E.
14th Floor
Atlanta, GA 30308

The Bank of California 475 Sansome Street
(International Equity Index Fund Suite 1200
only) San Francisco, CA 94111

The Bank of New York One Wall Street
(International Equity Fund only) New York, NY 10286

* LEGAL COUNSEL

Morgan, Lewis & Bockius LLP 2000 One Logan Square
Philadelphia, PA 19103

* INDEPENDENT PUBLIC ACCOUNTANTS

Arthur Andersen, LLP 1601 Market Street
Philadelphia, PA 19103
</TABLE>
<PAGE>

STI CLASSIC FUNDS

Supplement dated May 7, 1996 to
the Statement of Additional Information
dated October 1, 1995

The Statement of Additional Information for STI Classic Funds is hereby
amended and supplemented by the following unaudited financial statements of
the International Equity Fund for the period ended March 31, 1996.

PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE

<PAGE>

Schedule of Investments STI CLASSIC FUNDS
MARCH 31, 1996 Unaudited
Market
INTERNATIONAL EQUITY FUND Shares Value (000)
- --------------------------------------------------------------------------------
Foreign Common Stocks (99.8%)
- --------------------------------------------------------------------------------
<S> <C> <C>
Argentina (1.0%)
Telefonica Argentina ADR . . . . . . . . . . $ 64,500 $ 1,653
Total Argentina . . . . . . . . . . . . . . . . . . . . . 1,653

Australia (2.0%)
Australia & New Zealand Bank . . . . . . . . 152,425 729
Newscorp . . . . . . . . . . . . . . . . . . 125,500 734
QBE Insurance. . . . . . . . . . . . . . . . 167,000 834
Tabcorp. . . . . . . . . . . . . . . . . . . 268,000 1,086
Total Australia . . . . . . . . . . . . . . . . . . . . . 3,383

Brazil (0.6%)
Usiminas ADR . . . . . . . . . . . . . . . . 90,000 968
Total Brazil. . . . . . . . . . . . . . . . . . . . . . . 968

Canada (3.8%)
Alcan Aluminum . . . . . . . . . . . . . . . 50,000 1,613
Bank of Montreal . . . . . . . . . . . . . . 85,000 1,981
Bombardier . . . . . . . . . . . . . . . . . 60,000 886
CAE . . . . . . . . . . . . . . . . . . . . 224,988 1,940
Total Canada. . . . . . . . . . . . . . . . . . . . . . . 6,420

Denmark (2.7%)
Copenhagen Airports. . . . . . . . . . . . . 13,000 1,277
Novo Nordisk . . . . . . . . . . . . . . . . 12,700 1,625
Sophus Berendsen . . . . . . . . . . . . . . 15,000 1,790
Total Denmark . . . . . . . . . . . . . . . . . . . . . . 4,692

Finland (7.1%)
Cultor 2 . . . . . . . . . . . . . . . . . . 107,700 4,886
Finnair. . . . . . . . . . . . . . . . . . . 200,000 1,629
Konecranes*. . . . . . . . . . . . . . . . . 50,000 880
Raision Tehtaat. . . . . . . . . . . . . . . 25,000 859
Repola . . . . . . . . . . . . . . . . . . . 110,000 2,186
TT Tieto . . . . . . . . . . . . . . . . . . 50,000 1,674
Total Finland . . . . . . . . . . . . . . . . . . . . . . 12,114

France (6.2%)
Christian Dior . . . . . . . . . . . . . . . 40,350 5,377
Ecco . . . . . . . . . . . . . . . . . . . . 5,025 1,158
Lagardere Groupe . . . . . . . . . . . . . . 122,500 3,250
Societe Generale . . . . . . . . . . . . . . 7,000 778
Total France. . . . . . . . . . . . . . . . . . . . . . . 10,563

Germany (5.1%)
Altana . . . . . . . . . . . . . . . . . . . 1,200 738

</TABLE>

<PAGE>

Schedule of Investments STI CLASSIC FUNDS
MARCH 31, 1996 Unaudited
Market
INTERNATIONAL EQUITY FUND Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Hoechst. . . . . . . . . . . . . . . . . . . 2,300 $ 817
Mannesmann . . . . . . . . . . . . . . . . . 4,900 1,792
Siemens . . . . . . . . . . . . . . . . . . 4,600 2,523
Veba . . . . . . . . . . . . . . . . . . . . 38,600 1,878
Wella. . . . . . . . . . . . . . . . . . . . 2,000 983
Total Germany . . . . . . . . . . . . . . . . . . . . . . 8,731

Hong Kong (3.2%)
Cheung Kong Holdings . . . . . . . . . . . . 240,000 1,692
China Hong Kong Photo. . . . . . . . . . . . 500,000 255
HSBC Holdings. . . . . . . . . . . . . . . . 100,000 1,500
Swire Pacific, Cl A. . . . . . . . . . . . . 90,000 791
Tingyi*. . . . . . . . . . . . . . . . . . . 1,962,000 514
Yue Yuen . . . . . . . . . . . . . . . . . . 2,700,000 656
Total Hong Kong . . . . . . . . . . . . . . . . . . . . . 5,408

Indonesia (1.0%)
Indorama Synthetics. . . . . . . . . . . . . 492,000 1,684
Total Indonesia . . . . . . . . . . . . . . . . . . . . . 1,684

Ireland (0.2%)
CRH-Dublin . . . . . . . . . . . . . . . . . 36,229 318
Total Ireland . . . . . . . . . . . . . . . . . . . . . . 318

Italy (0.7%)
Saipem . . . . . . . . . . . . . . . . . . . 350,000 1,162
Total Italy . . . . . . . . . . . . . . . . . . . . . . . 1,162

Japan (12.8%)
Amway Japan. . . . . . . . . . . . . . . . . 87,900 2,187
Canon. . . . . . . . . . . . . . . . . . . . 142,000 2,710
Fuji Photo Film. . . . . . . . . . . . . . . 82,000 2,347
Mitsubishi Heavy Industries. . . . . . . . . 294,000 2,541
Nippon Television Network. . . . . . . . . . 10,000 2,947
Omron. . . . . . . . . . . . . . . . . . . . 79,000 1,751
Paris Miki . . . . . . . . . . . . . . . . . 90,200 3,459
Sanyo Shinpan. . . . . . . . . . . . . . . . 26,300 1,944
Sony . . . . . . . . . . . . . . . . . . . . 33,400 1,997
Total Japan . . . . . . . . . . . . . . . . . . . . . . . 21,883

Malaysia (0.3%)
Arab Malaysian Finance . . . . . . . . . . . 114,000 563
Total Malaysia. . . . . . . . . . . . . . . . . . . . . . 563

Mexico (2.2%)
Panamerican Beverages ADR. . . . . . . . . . 93,000 3,757
Total Mexico. . . . . . . . . . . . . . . . . . . . . . . 3,757

</TABLE>

<PAGE>

<TABLE>

Schedule of Investments STI CLASSIC FUNDS
MARCH 31, 1996 Unaudited
Market
INTERNATIONAL EQUITY FUND Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Netherlands (11.4%)
ABN - Amro . . . . . . . . . . . . . . . . . 46,000 $ 2,289
Amev . . . . . . . . . . . . . . . . . . . . 48,200 3,401
DSM . . . . . . . . . . . . . . . . . . . . 17,500 1,661
Hollandsche Beton Groep. . . . . . . . . . . 1,500 249
IHC Caland . . . . . . . . . . . . . . . . . 67,500 2,755
International Nederlanden. . . . . . . . . . 51,000 3,705
KPN . . . . . . . . . . . . . . . . . . . . 39,900 1,570
VNU . . . . . . . . . . . . . . . . . . . . 232,000 3,864
Total Netherlands . . . . . . . . . . . . . . . . . . . . 19,494

New Zealand (0.4%)
Fletcher Challenge Building* . . . . . . . . 297,500 731
Total New Zealand . . . . . . . . . . . . . . . . . . . . 731

Peru (2.4%)
CPT Telefonica del Peru. . . . . . . . . . . 1,171,569 2,418
Credicorp. . . . . . . . . . . . . . . . . . 89,700 1,615
Total Peru. . . . . . . . . . . . . . . . . . . . . . . . 4,033

Philippines (1.8%)
Benpres GDS* . . . . . . . . . . . . . . . . 502,961 3,144
Total Philippines . . . . . . . . . . . . . . . . . . . . 3,144

Republic of Panama (1.5%)
Banco Latino Americano . . . . . . . . . . . 52,200 2,577
Total Republic of Panama. . . . . . . . . . . . . . . . . 2,577

South Korea (0.6%)
Korea Chemical . . . . . . . . . . . . . . . 10,000 1,095
Total South Korea . . . . . . . . . . . . . . . . . . . . 1,095

Spain (3.4%)
Repsol . . . . . . . . . . . . . . . . . . . 88,800 3,350
Telefonica de Espana . . . . . . . . . . . . 150,000 2,382
Total Spain . . . . . . . . . . . . . . . . . . . . . . . 5,732

Sweden (10.0%)
Avesta Sheffield . . . . . . . . . . . . . . 140,200 1,416
Cardo* . . . . . . . . . . . . . . . . . . . 80,000 1,628
Ericsson . . . . . . . . . . . . . . . . . . 108,100 2,377
Getinge Industrier . . . . . . . . . . . . . 71,100 3,636
Hoganas. . . . . . . . . . . . . . . . . . . 53,400 1,626
Kalmar . . . . . . . . . . . . . . . . . . . 40,900 777
Nobelpharma. . . . . . . . . . . . . . . . . 70,000 1,100
SKF . . . . . . . . . . . . . . . . . . . . 70,000 1,545
Svedala. . . . . . . . . . . . . . . . . . . 92,400 3,013
Total Sweden. . . . . . . . . . . . . . . . . . . . . . . 17,118

</TABLE>

<PAGE>

Switzerland (7.8%)
Brown Boveri & Cie . . . . . . . . . . . . . 2,315 $ 2,817
Ciba Geigy . . . . . . . . . . . . . . . . . 3,000 3,757
Roche Holdings . . . . . . . . . . . . . . . 100 831
Sandoz Pharmaceutical. . . . . . . . . . . . 2,900 3,402
Societe Generale Surveillance. . . . . . . . 1,240 2,592
Total Switzerland . . . . . . . . . . . . . . . . . . . . 13,399

United Kingdom (10.5%)
Astec. . . . . . . . . . . . . . . . . . . . 457,000 900
Bank of Ireland. . . . . . . . . . . . . . . 401,055 2,652
British Airport Authority. . . . . . . . . . 200,000 1,637
CRH . . . . . . . . . . . . . . . . . . . . 173,700 1,527
Grand Metropolitan . . . . . . . . . . . . . 165,000 1,062
Grand Metropolitan ADR . . . . . . . . . . . 35,000 919
National Power . . . . . . . . . . . . . . . 407,000 2,900
Orange ADR*. . . . . . . . . . . . . . . . . 283,000 4,846
Rank Organisation. . . . . . . . . . . . . . 207,000 1,539
Total United Kingdom. . . . . . . . . . . . . . . . . . . 17,982

United States (1.1%)
Comverse Technology* . . . . . . . . . . . . 80,700 1,947
Total United States . . . . . . . . . . . . . . . . . . . 1,947

- --------------------------------------------------------------------------------
Total Foreign Common Stocks
(Cost $163,461,427). . . . . . . . . . . . . . . . . 170,551
- --------------------------------------------------------------------------------

Total Investments (99.8% of Net Assets)
(Cost $163,461,427). . . . . . . . . . . . . . . . . $ 170,551
- --------------------------------------------------------------------------------
</TABLE>

* Non-income producing security

ADR - American Depository Receipt

<PAGE>

STATEMENT OF ASSETS AND LIABILITIES (000) STI CLASSIC FUNDS
MARCH 31, 1996 (UNAUDITED)

--------------------
INTERNATIONAL
EQUITY
FUND
--------------------
<S> <C>
ASSETS:

Investments at market value (Cost $163,461,427) $ 170,551
Cash and foreign currency 8,044
Receivables for investment securities sold 4,768
Receivables for capital shares sold 1,278
Other assets 300
------------------------
Total assets 184,941
------------------------

LIABILITIES:
Payables for investment securities purchased 13,612
Payables for capital shares repurchased 193
Accrued expenses 252
------------------------
Total liabilities 14,057
------------------------

NET ASSETS:
Fund shares of the Trust Class (unlimited authorization -
no par value) based on 15,440,533 outstanding shares of
beneficial interest 159,043
Fund shares of the Investor Class (unlimited authorization -
no par value) based on 214,704 outstanding shares of
beneficial interest 2,275
Fund shares of the Flex Class (unlimited authorization -
no par value) based on 47,950 outstanding shares of
beneficial interest 509
Accumulated net realized gain on investments 2,039
Accumulated net realized loss on foreign currency transactions (109)
Undistributed net investment income 41
Net unrealized appreciation on investments 7,090
Net unrealized depreciation on foreign currency and
translation of other assets and liabilities in foreign
currency (4)
------------------------
Total net assets $ 170,884
------------------------
------------------------

Net Asset Value, Offering and Redemption Price Per Share - Trust Class $ 10.88
------------------------
------------------------
Net Asset Value and Redemption Price Per Share - Investor Class $ 10.87
------------------------
------------------------
Maximum Public Offering Price Per Share - Investor Class ($10.87/96.25%) $ 11.29
------------------------
------------------------
Net Asset Value, Offering and Redemption Price Per Share - Flex Class(1) $ 10.86
------------------------
------------------------

</TABLE>

- -----------------------------------------------------------
(1) Flex Class has a contingent deferred sales charge.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

<PAGE>

STATEMENT OF OPERATIONS (000) STI CLASSIC FUNDS
FOR THE PERIOD ENDED MARCH 31, 1996 (UNAUDITED)

----------------
INTERNATIONAL
EQUITY
FUND (1)
----------------
<S> <C>
INVESTMENT INCOME:
Interest $ 127
Dividends 547
Less: Foreign taxes withheld (58)
-----------------
Total investment income 616
-----------------
EXPENSES:
Investment advisory fees 491
Investment advisory fees waived (100)
Administration fees 28
Custody fees 67
Legal and audit fees 5
Printing fees 3
Organizational costs -
Transfer agent fees 15
Registration and filing fees 59
Distributions fees - Investor 1
Distributions fees waived- Investor (1)
Distribution fees - Flex 1
Distribution fees waived - Flex (1)
Other fees 7
-----------------
Total expenses 575
-----------------
NET INVESTMENT INCOME 41
-----------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on securities sold 2,039
Net realized loss on foreign currency transactions (109)
Net change in unrealized appreciation on
investments 7,090
Net change in unrealized depreciation on foreign currency and
translation of other assets and liabilities in foreign currency (4)
-----------------
Total net realized and unrealized gain on investments 9,016
-----------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 9,057
-----------------
-----------------

</TABLE>

- ----------------------------------------------------
1 Commenced operations on December 1, 1995.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

<PAGE>

STATEMENT OF CHANGES IN NET ASSETS (000) STI CLASSIC FUNDS
FOR THE PERIOD ENDED MARCH 31, 1996 (UNAUDITED)

----------------
INTERNATIONAL
EQUITY
FUND
12/1/95 (1)
to 3/31/96
----------------
<S> <C>
OPERATIONS:
Net investment income $ 41
Net realized gain on investments and foreign currency transactions 1,930
Net change in unrealized appreciation of investments and foreign currency
transactions 7,086
----------------
Net increase in net assets resulting from operations 9,057
----------------

SHARE TRANSACTIONS:
Trust Class:
Proceeds from shares issued 168,592
Shares issued in lieu of cash distributions -
Cost of shares repurchased (9,549)
----------------
Increase in net assets derived from Institutional Class transactions 159,043
----------------
Investor Class:
Proceeds from shares issued 2,478
Shares issued in lieu of cash distributions -
Cost of shares repurchased (203)
----------------
Increase in net assets derived from Retail Class transactions 2,275
----------------

Flex Class:
Proceeds from shares issued 511
Shares issued in lieu of cash distributions -
Cost of shares repurchased (2)
----------------
Increase in net assets derived from Flex Class transactions 509
----------------

Increase in net assets derived from capital share transactions 161,827
----------------
Net increase in net assets 170,884

NET ASSETS:
Beginning of period -
----------------
End of period $ 170,884
----------------
----------------
SHARES ISSUED AND REDEEMED:
Trust Class:
Shares issued 16,344
Shares issued in lieu of cash distributions -
Shares repurchased (903)
----------------
Total Institutional Class transactions 15,441
----------------

Investor Class:
Shares issued 234
Shares issued in lieu of cash distributions -
Shares repurchased (19)
----------------
Total Retail Class transactions 215
----------------
Flex Class:
Shares issued 48
Shares issued in lieu of cash distributions -
Shares repurchased -
----------------
Total Flex Class transactions 48
----------------
Increase in capital shares 15,704
----------------
----------------

</TABLE>

- --------------------------
1 Commenced operations on December 1, 1995.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

<PAGE>

NOTES TO FINANCIAL STATEMENTS STI CLASSIC FUNDS
MARCH 31, 1996 UNAUDITED

STI INTERNATIONAL EQUITY FUND

(1) ORGANIZATION

The STI Classic Funds (the "Trust") was organized as a Massachusetts business
trust under a Declaration of Trust dated January 15, 1992. The Trust is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company. The Trust presently consists of a series of
nineteen portfolios which includes the International Equity Fund (the "Fund").
The Fund commenced operations on December 1, 1995. The other portfolios in the
series which are not being reported at this time include the Prime Quality Money
Market Fund, the U.S. Government Securities Money Market Fund, the Tax-Exempt
Money Market Fund, the Investment Grade Bond Fund, the Investment Grade
Tax-Exempt Bond Fund, the Short-Term U.S. Treasury Securities Fund, the
Short-Term Bond Fund, the Capital Growth Fund, the Value Income Stock Fund, the
Sunbelt Equity Fund, the Mid-Cap Equity Fund, the Balanced Fund, the Florida
Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond Fund, the Tennessee Tax-Exempt
Bond Fund, the U.S. Government Securities Fund, the Limited-Term Federal
Mortgage Securities Fund, the International Equity Index Fund and the
International Equity Fund. The assets of each portfolio are segregated, and a
shareholder's interest is limited to the fund in which shares are held.

(2) SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies followed by the Fund are as follows:

SECURITY VALUATION - Investment securities of the Fund which are listed on a
securities exchange for which market quotations are readily available are valued
at the last quoted sales price for such securities on each business day. If
there is no such reported sale, these securities and unlisted securities for
which market quotations are readily available are valued at the last quoted bid
price. Foreign securities are valued based upon quotations from the primary
market in which they are traded.

FEDERAL INCOME TAXES - It is the Fund's intention to qualify as a regulated
investment company for Federal income tax purposes and distribute all of its
taxable income and capital gains. Accordingly, no provision for Federal income
taxes is required.

SECURITY TRANSACTIONS AND RELATED INCOME - Security transactions are accounted
for on the date the security is purchased or sold (trade date). Dividend income
is recognized on the ex-dividend date, and interest income is recorded on the
accrual basis. Cost used in determining realized gains and losses on the sales
of investment securities are those of the specific securities sold.

NET ASSET VALUE PER SHARE - The net asset value per share of the Fund is
calculated on each business day, by dividing the total value of the fund's
assets, less liabilities, by the number of shares outstanding. The maximum
offering price per share for the Investor shares of the Fund is equal to the net
asset value per share plus a sales load of 3.75%.

<PAGE>

NOTES TO FINANCIAL STATEMENTS STI CLASSIC FUNDS
MARCH 31, 1996 UNAUDITED

STI INTERNATIONAL EQUITY FUND

FOREIGN CURRENCY TRANSLATION- The books and records of the Fund are maintained
in U.S. dollars on the following basis:
(I) market value of investment securities, assets and liabilities at the
current rate of exchange; and
(II) purchases and sales of investment securities, income and expenses at
the relevant rates of exchange prevailing on the respective dates of
such transactions.

The Fund does not isolate that portion of gains and losses on investments
in equity securities which is due to changes in the foreign exchange rates from
that which is due to change in market prices of equity securities.
The Fund reports certain foreign currency related transactions as
components of realized gains for financial reporting purposes, whereas such
components are treated as ordinary income for Federal income tax purposes.

OTHER - Expenses that are directly related to the Fund are charged directly to
the Fund. Class specific expenses, such as the 12b-1 fees, are borne by that
class. Other operating expenses of the Trust are prorated to the Funds on the
basis of relative net asset value.

Distributions from net investment income is declared and paid to
shareholders annually. Any net realized capital gains on sales of securities
are distributed to shareholders at least annually.

(3) ORGANIZATION COSTS AND TRANSACTIONS WITH AFFILIATES:

Organizational costs of approximately $10,000 have been capitalized by the Fund
and are being amortized over sixty months commencing with operations.

Certain officers of the Trust are also officers of SEI Financial Management
Corporation (the "Administrator") and/or SEI Financial Services Company (the
"Distributor"). Such officers are paid no fees by the Trust for serving as
officers of the Trust.

(4) ADMINISTRATION, TRANSFER AGENCY SERVICING AND DISTRIBUTIONS AGREEMENTS:

The Trust and the Administrator are parties to an Administration agreement dated
May 29, 1995, under which the Administrator provides administrative services for
an annual fee (expressed as a percentage of the combined average daily net
assets of the Trust and STI Variable Annuity Trust) of: .10% up to $1 billion,
.07% on the next $4 billion, .05% on the next $3 billion, .045% on the next $2
billion and .04% for over $10 billion.

The Trust and Federated Services Company are parties to a Transfer Agency
servicing agreement dated May 14, 1994 under which Federated Services Company
provides transfer agency services to the Trust.

The Trust and the Distributor are parties to a Distribution Agreement (12b-1
Plan) dated May 29, 1995. The Distributor will receive no fees for its
distribution services under this agreement for the Trust Shares of the Fund.
With respect to the Investor Shares and Flex Shares, the Distributor receives an
amounts, pursuant to a Distribution Plan and (in the case of Flex Shares) a
Service Plan, as outlined in the table in footnote 5 under column titled
"Distribution Fee".

<PAGE>

NOTES TO FINANCIAL STATEMENTS STI CLASSIC FUNDS
MARCH 31, 1996 UNAUDITED

STI INTERNATIONAL EQUITY FUND

(5) INVESTMENT ADVISORY AGREEMENT:

The Trust and SunBank Capital Management, N.A. have entered into an advisory
agreement dated May 29, 1992.

Under terms of the agreement, the Fund is charged the following annual fees
based upon average net assets:
<TABLE>
<CAPTION>
MAXIMUM
FLEX
MAXIMUM SHARE
MAXIMUM TRUST INVESTOR INVESTOR DISTRIBUTION FLEX
ANNUAL SHARE SHARE SHARE AND SHARE
ADVISORY MAXIMUM DISTRI- MAXIMUM SERVICE MAXIMUM
FEE EXPENSE BUTION FEE EXPENSE FEE EXPENSE
----- ------- ---------- ------- --- -------
<S> <C> <C> <C> <C> <C> <C>
International Equity Fund 1.25% 1.46% .33% 1.81% 1.00% 2.51%

</TABLE>

The Investment Advisor, the Administrator and the Distributor have voluntarily
agreed to waive all or a portion of their fees (and to reimburse Funds'
expenses) in order to limit operating expenses to an amount as outlined in the
table above. Fee waivers and expense reimbursements are voluntary and may be
terminated at any time.

(6) INVESTMENT TRANSACTIONS

During the period December 1, 1995 to March 31, 1996 the cost of purchases and
the proceeds from sales of securities, other than temporary investments in
short-term securities were as follows:
<TABLE>
<CAPTION>

U.S. GOVERNMENT SECURITIES OTHER INVESTMENT SECURITIES
--------------------------- ----------------------------
PURCHASES (000) SALES (000) PURCHASES (000) SALES (000)
--------------- ----------- --------------- -----------
<S> <C> <C> <C> <C>
International Equity Fund --- --- $210,703 $145,930

</TABLE>

At March 31, 1996, the total cost of securities and the net realized gains or
losses on securities sold, for Federal Income Tax purposes, was not materially
different from amounts reported for financial reporting purposes. The aggregate
gross unrealized appreciation and depreciation for securities held by the Fund
at March 31, 1996 is as follows (000):

INTERNATIONAL EQUITY FUND
-------------------------
<S> <C>
Aggregate gross
unrealized appreciation $ 9,029
Aggregate gross
unrealized depreciation (1,939)
------
Net unrealized
appreciation $ 7,090
-----
</TABLE>

<PAGE>

STI CLASSIC FUNDS

Investment Advisor:

SunBank Capital Management, N.A.

This Statement of Additional Information is not a prospectus. It is intended
to provide additional information regarding the activities and operations of
the Trust and should be read in conjunction with the Trust's International
Equity Fund prospectus dated October 31, 1995. Prospectuses may be obtained
through the Distributor, SEI Financial Services Company, 680 E. Swedesford
Road, Wayne, PA 19087-1658.

TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
THE TRUST. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B-2
DESCRIPTION OF PERMITTED INVESTMENTS . . . . . . . . . . . . . . . .B-2
INVESTMENT LIMITATIONS . . . . . . . . . . . . . . . . . . . . . . .B-9
INVESTMENT ADVISORS. . . . . . . . . . . . . . . . . . . . . . . . B-11
THE ADMINISTRATOR. . . . . . . . . . . . . . . . . . . . . . . . . B-12
THE DISTRIBUTOR. . . . . . . . . . . . . . . . . . . . . . . . . . B-13
TRUSTEES AND OFFICERS OF THE TRUST . . . . . . . . . . . . . . . . B-14
COMPUTATION OF YIELD . . . . . . . . . . . . . . . . . . . . . . . B-16
CALCULATION OF TOTAL RETURN. . . . . . . . . . . . . . . . . . . . B-17
PURCHASE AND REDEMPTION OF SHARES. . . . . . . . . . . . . . . . . B-17
DETERMINATION OF NET ASSET VALUE . . . . . . . . . . . . . . . . . B-18
TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-18
FUND TRANSACTIONS. . . . . . . . . . . . . . . . . . . . . . . . . B-20
TRADING PRACTICES AND BROKERAGE. . . . . . . . . . . . . . . . . . B-20
DESCRIPTION OF SHARES. . . . . . . . . . . . . . . . . . . . . . . B-22
SHAREHOLDER LIABILITY. . . . . . . . . . . . . . . . . . . . . . . B-22
LIMITATION OF TRUSTEES' LIABILITY. . . . . . . . . . . . . . . . . B-22
EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-23
</TABLE>

October 31, 1995

<PAGE>

THE TRUST

STI Classic Funds is a diversified, open-end management investment company
established under Massachusetts law as a Massachusetts Business Trust under a
Declaration of Trust dated January 15, 1992. The Declaration of Trust
permits the Trust to offer separate series ("Funds") of units of beneficial
interest ("shares") and different classes of shares of each Fund.
Shareholders at present may purchase shares through three separate classes
(Trust Shares, Investor Shares and Flex Shares), which provide for variations
in distribution costs, voting rights and dividends. Except for these
differences, each Trust Share, Investor Share and Flex Share of each Fund
represents an equal proportionate interest in that portfolio. See
"Description of Shares." This Statement of Additional Information relates to
the Trust Shares, Investor Shares and Flex Shares of the Trust's
International Equity Fund (the "Fund").

DESCRIPTION OF PERMITTED INVESTMENTS

VARIABLE RATE MASTER DEMAND NOTES

The Fund may invest in variable rate master demand notes which may or may not
be backed by bank letters of credit. These notes permit the investment of
fluctuating amounts at varying market rates of interest pursuant to direct
arrangements between the Fund, as lender, and the borrower. Such notes
provide that the interest rate on the amount outstanding varies on a daily,
weekly or monthly basis depending upon a stated short-term interest rate
index. Both the lender and the borrower have the right to reduce the amount
of outstanding indebtedness at any time. There is no secondary market for
the notes and it is not generally contemplated that such instruments will be
traded. The quality of the note or the underlying credit must, in the
opinion of the Advisor, be equivalent to the ratings applicable to permitted
investments for each Fund. The Advisor will monitor on an ongoing basis the
earning power, cash flow and liquidity ratios of the issuers of such
instruments and will similarly monitor the ability of an issuer of a demand
instrument to pay principal and interest on demand.

STRIPS

The Fund may invest in Separately Traded Interest and Principal Securities
("STRIPS"), which are component parts of U.S. Treasury Securities traded
through the Federal Book-Entry System. The Advisor will only purchase STRIPS
that it determines are liquid or, if illiquid, do not violate each Fund's
investment policy concerning investments in illiquid securities.

U.S. GOVERNMENT AGENCY SECURITIES

Certain investments of the Fund may include U.S. Government Agency
Securities. Agencies of the United States Government which issue obligations
consist of, among others, the Export Import Bank of the United States,
Farmers Home Administration, Federal Farm Credit Bank, Federal Housing
Administration, Government National Mortgage Association ("GNMA"), Maritime
Administration, Small Business Administration, and The Tennessee Valley
Authority.

B-2
<PAGE>
Obligations of instrumentalities of the United States Government include
securities issued by, among others, Federal Home Loan Banks, Federal Home
Loan Mortgage Corporation ("FHLMC"), Federal Intermediate Credit Banks,
Federal Land Banks, Federal National Mortgage Association ("FNMA") and the
United States Postal Service as well as government trust certificates. Some
of these securities are supported by the full faith and credit of the United
States Treasury (e.g., GNMA), others are supported by the right of the issuer
to borrow from the Treasury and still others are supported only by the credit
of the instrumentality (e.g., FNMA). Guarantees of principal by agencies or
instrumentalities of the U.S. Government may be a guarantee of payment at the
maturity of the obligation so that in the event of a default prior to
maturity there might not be a market and thus no means of realizing the value
of the obligation prior to maturity.

REPURCHASE AGREEMENTS

The Fund may enter into repurchase agreements. Repurchase agreements are
agreements by which a person (e.g., a Fund) obtains a security and
simultaneously commits to return the security to the seller (a primary
securities dealer as recognized by the Federal Reserve Bank of New York or a
national member bank as defined in Section 3(d)(1) of the Federal Deposit
Insurance Act, as amended) at an agreed upon price (including principal and
interest) on an agreed upon date within a number of days (usually not more
than seven) from the date of purchase. The resale price reflects the
purchase price plus an agreed upon market rate of interest which is unrelated
to the coupon rate or maturity of the underlying security. A repurchase
agreement involves the obligation of the seller to pay the agreed upon price,
which obligation is in effect secured by the value of the underlying security.

Repurchase agreements are considered to be loans by the Fund for purposes of
its investment limitations. The repurchase agreements entered into by the
Fund will provide that the underlying security at all times shall have a
value at least equal to 102% of the resale price stated in the agreement (the
Advisor monitors compliance with this requirement). Under all repurchase
agreements entered into by the Fund, the Custodian or its agent must take
possession of the underlying collateral. However, if the seller defaults,
the Fund could realize a loss on the sale of the underlying security to the
extent that the proceeds of the sale including accrued interest are less than
the resale price provided in the agreement including interest. In addition,
even though the Bankruptcy Code provides protection for most repurchase
agreements, if the seller should be involved in bankruptcy or insolvency
proceedings, the Fund may incur delay and costs in selling the underlying
security or may suffer a loss of principal and interest if the Fund is
treated as an unsecured creditor and required to return the underlying
security to the seller's estate.

WHEN-ISSUED SECURITIES

The Fund may purchase securities on a when-issued basis, in which case
delivery and payment normally take place within 45 days after the date of
commitment to purchase. The Fund will only make commitments to purchase
obligations on a when-issued basis with the

B-3
<PAGE>

intention of actually acquiring the securities, but may sell them before the
settlement date. The when-issued securities are subject to market
fluctuation, and no interest accrues on the security to the purchaser during
this period. The payment obligation and the interest rate that will be
received on the securities are each fixed at the time the purchaser enters
into the commitment. Purchasing obligations on a when-issued basis is a form
of leveraging and can involve a risk that the yields available in the market
when the delivery takes place may actually be higher than those obtained in
the transaction itself. In that case there could be an unrealized loss at
the time of delivery.

Segregated accounts will be established with the Custodian, and the Fund will
maintain high quality, liquid assets in an amount at least equal in value to
the Fund's commitments to purchase when-issued securities. If the value of
these assets declines, the Fund will place additional liquid assets in the
account on a daily basis so that the value of the assets in the account is
equal to the amount of such commitments.

RESTRICTED SECURITIES

Restricted Securities are securities that may not be sold to the public
without registration under the Securities Act of 1933 (the "1933 Act") absent
an exemption from registration. Permitted investments for the Fund includes
restricted securities, and the Fund may invest up to 15% of its total assets
in illiquid securities, subject to the Fund's investment limitations on the
purchase of illiquid securities. Restricted Securities, including securities
eligible for re-sale under 1933 Act Rule 144A, that are determined to be
liquid are not subject to this limitation. This determination is to be made
by the Fund's Advisor pursuant to guidelines adopted by the Board of
Trustees. Under these guidelines, the Advisor will consider the frequency
of trades and quotes for the security, the number of dealers in, and
potential purchasers for, the securities, dealer undertakings to make a
market in the security, and the nature of the security and of the marketplace
trades. In purchasing such Restricted Securities, the Advisor intends to
purchase securities that are exempt from registration under Rule 144A under
the 1933 Act.

SECURITIES LENDING

The Fund may lend securities pursuant to agreements requiring that the loans
be continuously secured by cash, securities of the U.S. Government or its
agencies, or any combination of cash and such securities, as collateral equal
to 100% of the market value at all times of the securities lent. Such loans
will not be made if, as a result, the aggregate amount of all outstanding
securities loans for the Fund exceed one-third of the value of the Fund's
total assets taken at fair market value. The Fund will continue to receive
interest on the securities lent while simultaneously earning interest on the
investment of the cash collateral in U.S. Government securities. However,
the Fund will normally pay lending fees to such broker-dealers and related
expenses from the interest earned on invested collateral. There may be risks
of delay in receiving additional collateral or risks of delay in recovery of
the securities or even loss of rights in the collateral should the borrower
of the securities fail

B-4
<PAGE>
financially. However, loans are made only to borrowers deemed by the Advisor
to be of good standing and when, in the judgment of the Advisor, the
consideration which can be earned currently from such securities loans
justifies the attendant risk. Any loan may be terminated by either party
upon reasonable notice to the other party. The Fund may use the Distributor
or a broker-dealer affiliate of the Advisor as a broker in these transactions.

FUTURES CONTRACTS AND OPTIONS ON FUTURES

The Fund may invest in futures contracts and options on futures. Although
futures contracts by their terms call for actual delivery or acceptance of
the underlying securities, in most cases the contracts are closed out before
the settlement date without the making or taking of delivery. Closing out an
open futures position is done by taking an opposite position ("buying" a
contract which has previously been "sold" or "selling" a contract previously
"purchased") in an identical contract to terminate the position. Brokerage
commissions are incurred when a futures contract is bought or sold.

Futures traders are required to make a good faith margin deposit in cash or
government securities with or for the account of a broker or custodian to
initiate and maintain open positions in futures contracts. A margin deposit
is intended to assure completion of the contract (delivery or acceptance of
the underlying security) if it is not terminated prior to the specified
delivery date. Minimal initial margin requirements are established by the
futures exchange and may be changed. Brokers may establish deposit
requirements which are higher than the exchange minimums. Deposit
requirements on futures contracts customarily range upward from less than 5%
of the value of the contract being traded.

After a futures contract position is opened, the value of the contract is
marked to market daily. If the futures contract price changes to the extent
that the margin on deposit does not satisfy the required margin, payment of
additional "variation" margin will be required. Conversely, changes in the
contract value may reduce the required margin, resulting in a repayment of
excess margin to the contract holder. Variation margin payments are made to
and from the futures broker for as long as the contract remains open. The
Fund expects to earn interest income on their margin deposits.

Traders in futures contracts and related options may be broadly classified as
either "hedgers" or "speculators." Hedgers use the futures markets primarily
to offset unfavorable changes in the value of securities otherwise held or
expected to be acquired for investment purposes. Speculators are less
inclined to own the securities underlying the futures contracts which they
trade, and use futures contracts with the expectation of realizing profits
from fluctuations in the prices of underlying securities. The Fund intends
to use futures contracts and related options only for bona fide hedging
purposes.

Regulations of the Commodity Futures Trading Commission applicable to the
Fund require that all of the futures transactions and related options
constitute bona fide hedging transactions. The Fund will only sell futures
contracts to protect securities they own against

B-5
<PAGE>
price declines or purchase contracts to protect against an increase in the
price of securities they intend to purchase. As evidence of this hedging
interest, the Fund expects that approximately 75% of its futures contract
purchases will be "completed," that is, equivalent amounts of related
securities will have been purchased or are being purchased by the Fund upon
sale of open futures contracts.

Although techniques other than the sale and purchase of futures contracts and
options on futures contracts could be used to control the Fund's exposure to
market fluctuations, the use of futures contracts may be a more effective
means of hedging this exposure. While the Fund will incur commission
expenses in both opening and closing out futures positions, these costs are
lower than transaction costs incurred in the purchase and sale of the
underlying securities.

RISK FACTORS IN FUTURES TRANSACTIONS

Positions in futures contracts may be closed out only on an exchange which
provides a secondary market for such futures. However, there can be no
assurance that a liquid secondary market will exist for any particular
futures contract at any specific time. Thus, it may not be possible to close
a futures position. In the event of adverse price movements, the Fund would
continue to be required to make daily cash payments to maintain its required
margin. In such situations, if the Fund has insufficient cash, it may have
to sell portfolio securities to meet daily margin requirements at a time when
it may be disadvantageous to do so. In addition, the Fund may be required to
make delivery of the instruments underlying futures contracts they hold. The
inability to close options and futures positions also could have an adverse
impact on the ability to effectively hedge it.

The Fund will minimize the risk that it will be unable to close out a futures
contract by entering into futures contracts only if they are traded on
national futures exchanges and for which there appears to be a liquid
secondary market.

The risk of loss in trading futures contracts can be substantial, due both to
the low margin deposits required and the extremely high degree of leverage
involved in futures pricing. As a result, a relatively small price movement
in a futures contract may result in immediate and substantial loss (or gain)
to a Fund. For example, if at the time of purchase, 10% of the value of the
futures contract is deposited as margin, a subsequent 10% decrease in the
value of the futures contract would result in a total loss of the margin
deposit, before any deduction for the transaction costs, if the account were
then closed out. A 15% decrease would result in a loss equal to 150% of the
original margin deposit if the contract were closed out. Thus, a purchase or
sale of a futures contract may result in losses in excess of the amount
invested in the contract. However, because the Fund will be engaged in
futures transactions only for hedging purposes, the Advisor does not believe
that the Fund will generally be subject to the risks of loss frequently
associated with futures transactions. The Fund presumably would have
sustained comparable losses if, instead of the futures contract, they had
invested in the underlying financial instrument and sold it after the
decline. The risk of

B-6
<PAGE>
loss from the purchase of options is less as compared with the purchase or
sale of futures contracts because the maximum amount at risk is the premium
paid for the option.

Utilization of futures transactions by the Fund does involve the risk of
imperfect or no correlation where the securities underlying futures contracts
have different maturities than the fund securities being hedged. It is also
possible that the Fund could both lose money on futures contracts and
experience a decline in value of its fund securities. There is also the risk
of loss by the Funds of margin deposits in the event of the bankruptcy of a
broker with whom the Fund has an open position in a futures contract or
related option.

Most futures exchanges limit the amount of fluctuation permitted in futures
contract prices during a single trading day. The daily limit establishes the
maximum amount that the price of a futures contract may vary either up or
down from the previous day's settlement price at the end of a trading
session. Once the daily limit has been reached in a particular type of
contract, no trades may be made on that day at a price beyond that limit.
The daily limit governs only price movement during a particular trading day
and therefore does not limit potential losses because the limit may prevent
the liquidation of unfavorable positions. Futures contract prices have
occasionally moved to the daily limit for several consecutive trading days
with little or no trading, thereby preventing prompt liquidation of future
positions and subjecting some futures traders to substantial losses.

OPTIONS

The Fund will not engage in option writing strategies for speculative
purposes. A call option gives the purchaser of such option the right to buy,
and the writer, in this case the Fund, the obligation to sell the underlying
security at the exercise price during the option period. The advantage to
the Fund of writing covered calls is that the Fund receives a premium which
is additional income. However, if the security rises in value, the Fund may
not fully participate in the market appreciation.

During the option period, a covered call option writer may be assigned an
exercise notice by the broker-dealer through whom such call option was sold
requiring the writer to deliver the underlying security against payment of
the exercise price. This obligation is terminated upon the expiration of the
option period or at such earlier time in which the writer effects a closing
purchase transaction. A closing purchase transaction is one in which the
Fund, when obligated as a writer of an option, terminates its obligation by
purchasing an option of the same series as the option previously written.

A closing purchase transaction cannot be effected with respect to an option
once the option writer has received an exercise notice for such option.

Closing purchase transactions will ordinarily be effected to realize a profit
on an outstanding call option, to prevent an underlying security from being
called, to permit the sale of the underlying security or to enable Fund to
write another call option on the underlying security

B-7
<PAGE>
with either a different exercise price or expiration date or both. The Fund
may realize a net gain or loss from a closing purchase transaction depending
upon whether the net amount of the original premium received on the call
option is more or less than the cost of effecting the closing purchase
transaction. Any loss incurred in a closing purchase transaction may be
partially or entirely offset by the premium received from a sale of a
different call option on the same underlying security. Such a loss may also
be wholly or partially offset by unrealized appreciation in the market value
of the underlying security. Conversely, a gain resulting from a decline in
the market value of the underlying security.

If a call option expires unexercised, the Fund will realize a short-term
capital gain in the amount of the premium on the option, less the commission
paid. Such a gain, however, may be offset by depreciation in the market
value of the underlying security during the option period. If a call option
is exercised, the Fund will realize a gain or loss from the sale of the
underlying security equal to the difference between the cost of the
underlying security, and the proceeds of the sale of the security plus the
amount of the premium on the option, less the commission paid.

The market value of a call option generally reflects the market price of an
underlying security. Other principal factors affecting market value include
supply and demand, interest rates, the price volatility of the underlying
security and the time remaining until the expiration date.

The Fund will write call options only on a covered basis, which means that
the Fund will own the underlying security subject to a call option at all
times during the option period. Unless a closing purchase transaction is
effected, the Fund would be required to continue to hold a security which it
might otherwise wish to sell, or deliver a security it would want to hold.
Options written by the Fund will normally have expiration dates between one
and nine months from the date written. The exercise price of a call option
may be below, equal to or above the current market value of the underlying
security at the time the option is written.

FOREIGN INVESTMENTS

The Fund will invest primarily in certain obligations or securities of
foreign issuers. Possible investments include equity securities of foreign
entities, obligations of foreign branches of U.S. banks and of foreign banks,
including, without limitation, European Certificates of Deposit, European
Time Deposits, European Bankers' Acceptances, Canadian Time Deposits and
Yankee Certificates of Deposit, and investments in Canadian Commercial Paper,
and foreign securities. These instruments may subject the Fund to investment
risks that differ in some respects from those related to investments in
obligations of U.S. domestic issuers. Such risks include future adverse
political and economic developments, the possible imposition of withholding
taxes on interest or other income, possible seizure, nationalization, or
expropriation of foreign deposits, the possible establishment of exchange
controls or taxation at the source, greater fluctuations in value due to
changes in exchange rates, or the adoption of other foreign governmental
restrictions which might adversely affect the payment of principal and
interest on such obligations. Such investments may also entail higher

B-8
<PAGE>
custodial fees and sales commissions than domestic investments. Foreign
issuers of securities or obligations are often subject to accounting
treatment and engage in business practices different from those respecting
domestic issuers of similar securities or obligations. Foreign branches of
U.S. banks and foreign banks may be subject to less stringent reserve
requirements than those applicable to domestic branches of U.S. banks.

By investing in foreign securities, the Fund attempts to take advantage of
differences between both economic trends and the performance of securities
markets in the various countries, regions and geographic areas as prescribed
by the Fund's investment objective and policies. During certain periods the
investment return on securities in some or all countries may exceed the
return on similar investments in the United States, while at other times the
investment return may be less than that on similar U.S. securities. Shares
of the Fund, when included in appropriate amounts in a portfolio otherwise
consisting of domestic securities, may provide a source of increased
diversification. The Fund seeks increased diversification by combining
securities from various countries and geographic areas that offer different
investment opportunities and are affected by different economic trends. The
international investments of the Fund may reduce the effect that events in
any one country or geographic area will have on its investment holdings. Of
course, negative movement by a Fund's investments in one foreign market
represented in its portfolio may offset potential gains from the Fund's
investments in another country's markets.

SHARES OF OTHER INVESTMENT COMPANIES

The Fund's purchase of investment company shares will result in the layering
of expenses. The Fund is prohibited from acquiring the securities of other
investment companies if, as a result of such acquisition, the Fund owns in
the aggregate (1) more than 3% of the total outstanding voting stock of the
acquired company, (2) securities issued by the acquired company having an
aggregate value of 5% of the value of the total assets of the Fund, or (3)
securities issued by the acquired company and all other investment companies
having an aggregate value in excess of 10% of the value of the total assets
of the Fund.

OTHER INVESTMENTS

The Trust is not prohibited from investing in obligations of banks which are
clients of SEI Corporation ("SEI"), the parent company of the Administrator
and the Distributor. However, the purchase of shares of the Trust by such
banks or by their customers will not be a consideration in determining which
bank obligations the Trust will purchase. The Trust will not purchase
obligations issued by the Advisor.

INVESTMENT LIMITATIONS

The following are fundamental policies of the International Equity Fund and
cannot be changed with respect to the Fund without the consent of the holders
of a majority of the Fund's outstanding shares.

B-9
<PAGE>

The Fund may not:

1. Acquire more than 10% of the voting securities of any one issuer.

2. Invest in companies for the purpose of exercising control.

3. Borrow money except for temporary or emergency purposes and then only in
an amount not exceeding one-third of the value of total assets. Any
borrowing will be done from a bank and, to the extent that such
borrowing exceeds 5% of the value of the Fund's assets, asset coverage
of at least 300% is required. In the event that such asset coverage
shall at any time fall below 300%, the Fund shall, within three days
thereafter or such longer period as the Securities and Exchange
Commission ("SEC") may prescribe by rules and regulations, reduce the
amount of its borrowings to such an extent that the asset coverage of
such borrowings shall be at least 300%. This borrowing provision is
included solely to facilitate the orderly sale of portfolio securities
to accommodate heavy redemption requests if they should occur and is not for
investment purposes. All borrowings in excess of 5% of the value of a
Fund's total assets will be repaid before making additional investments
and any interest paid on such borrowings will reduce income.

4. Make loans, except that (a) the Fund may purchase or hold debt
instruments in accordance with its investment objective and policies;
(b) the Fund may enter into repurchase agreements, and (c) the Fund may
engage in securities lending as described in the Prospectus and in this
Statement of Additional Information.

5. Pledge, mortgage or hypothecate assets except to secure temporary
borrowings permitted by (3) above in aggregate amounts not to exceed 10%
of the Fund's total assets, taken at current value at the time of the
incurrence of such loan, except as permitted with respect to securities
lending.

6. Purchase or sell real estate, real estate limited partnership interests,
commodities or commodities contracts and interests in a pool of
securities that are secured by interests in real estate. However,
subject to the permitted investment spectrum, the Fund may purchase
marketable securities issued by companies which own or invest in real estate,
commodities or commodities contracts, and commodities contracts relating
to financial instruments, such as financial futures contracts and
options on such contracts.

7. Make short sales of securities, maintain a short position or purchase
securities on margin, except that the Trust may obtain short-term
credits as necessary for the clearance of security transactions.

8. Act as an underwriter of securities of other issuers except as it may be
deemed an underwriter in selling a security.

B-10
<PAGE>
9. Issue senior securities (as defined in the 1940 Act) except in
connection with permitted borrowings as described above or as permitted
by rule, regulation or order of the SEC.

NON-FUNDAMENTAL POLICIES

The Fund may not purchase or retain securities of an issuer if, to the
knowledge of the Trust, an officer, trustee, partner or director of the Trust
or any investment advisor of the Trust owns beneficially more than 1/2 of 1%
of the shares or securities of such issuer and all such officers, trustees,
partners and directors owning more than 1/2 of 1% of such shares or
securities together own more than 5% of such shares or securities.

The Fund may not invest in warrants except that the Fund may invest in
warrants in an amount not exceeding 5% of the Fund's net assets as valued at
the lower of cost or market value. Included in that amount, but not to exceed
2% of the Fund's net assets, may be warrants not listed on the New York Stock
Exchange or American Stock Exchange.

The Fund may not invest in illiquid securities in an amount exceeding, in the
aggregate, 15% of the Fund's assets. An illiquid security is a security
which cannot be disposed of promptly (within seven days), and in the usual
course of business without a loss, and includes repurchase agreements
maturing in excess of seven days, time deposits with a withdrawal penalty,
non-negotiable instruments and instruments for which no market exists.

The Fund may invest in interests in oil, gas or other mineral exploration or
development programs and oil, gas or mineral leases.

The Fund may write or purchase puts, calls, options or combinations thereof,
except that the Fund may write covered call options with respect to any or
all parts of the Fund securities and engage in futures transactions, and the
Fund may purchase putable securities. The Fund may sell options previously
purchased and enter into closing transactions with respect to covered call
options.

The Fund may not invest in securities of issuers which together with
predecessors have a record of less than three years continuous operation or
equity securities of issuers which are not readily marketable if such
investments will exceed 5% of the Fund's total assets.

With the exception of the limitations on liquidity standards, the foregoing
percentages will apply at the time of the purchase of a security and shall
not be considered violated unless an excess occurs or exists immediately
after and as a result of a purchase of such security.

INVESTMENT ADVISORS

The Trust and SunBank Capital Management, N.A. (the "Advisor") have entered
into an advisory agreement with the Trust (the "Advisory Agreement"). The
Advisory Agreement

B-11
<PAGE>
provides that the Advisor shall not be protected against any liability to the
Trust or its Shareholders by reason of willful misfeasance, bad faith or
gross negligence on its part in the performance of its duties or from
reckless disregard of its obligations or duties thereunder.

The Advisory Agreement provides that if, for any fiscal year, the ratio of
expenses of any Fund (including amounts payable to an Advisor but excluding
interest, taxes, brokerage, litigation, and other extraordinary expenses)
exceeds limitations established by certain states, the Advisor and/or the
Administrator will bear the amount of such excess. The Advisor will not be
required to bear expenses of the Trust to an extent which would result in a
Fund's inability to qualify as a regulated investment company under
provisions of the Internal Revenue Code.

The continuance of the Advisory Agreement, after the first two years, must be
specifically approved at least annually (i) by the vote of the Trustees, and
(ii) by the vote of a majority of the Trustees who are not parties to each
Agreement or "interested persons" of any party thereto, cast in person at a
meeting called for the purpose of voting on such approval. The Advisory
Agreement will terminate automatically in the event of its assignment, and is
terminable at any time without penalty by the Trustees of the Trust or, with
respect to the Fund, by a majority of the outstanding shares of the Fund, on
not less than 30 days nor more than 60 days written notice to the Advisor, or
by the Advisor on 90 days written notice to the Trust.

THE ADMINISTRATOR

The Trust and SEI Financial Management Corporation (the "Administrator"), a
wholly-owned subsidiary of SEI have entered into an Administration Agreement
(the "Administration Agreement"). The Administration Agreement provides that
the Administrator shall not be liable for any error of judgment or mistake of
law or for any loss suffered by the Trust in connection with the matters to
which the Administration Agreement relates, except a loss resulting from
willful misfeasance, bad faith or gross negligence on the part of the
Administrator in the performance of its duties or from reckless disregard by
it of its duties and obligations thereunder.

The Administrator, a wholly-owned subsidiary of SEI Corporation ("SEI"), was
organized as a Delaware corporation in 1969 and has its principal business
offices at 680 East Swedesford Road, Wayne, PA 19087. Alfred P. West, Jr.,
Henry H. Greer, and Carmen V. Romeo constitute the Board of Directors of the
Administrator. Mr. West is the Chairman of the Board and Chief Executive
Officer of the Administrator and of SEI. SEI and its subsidiaries are
leading providers of funds evaluation services, trust accounting systems, and
brokerage and information services to financial institutions, institutional
investors and money managers. The Administrator also serves as administrator
to the following other institutional mutual funds: 1784 Funds; The
Achievement Funds Trust; The Advisors' Inner Circle Fund; The Arbor Fund;
Bishop Street Funds; The Compass Capital Group; Conestoga Family of Funds;
CoreFunds, Inc.; CrestFunds, Inc.; CUFund; FFB Lexicon Funds; First American
Investment

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<PAGE>
Funds, Inc.; First American Funds; Insurance Investment Products Trust;
Inventor Funds, Inc.; MarquisSM Funds; Morgan Grenfell Investment Trust; The
PBHG Funds, Inc.; The Pillar Funds; Rembrandt FundsR; SEI Liquid Asset Trust;
SEI International Trust; SEI Institutional Managed Trust; SEI Index Funds;
SEI Tax Exempt Trust; SEI Daily Income Trust; and Stepstone Funds.

THE DISTRIBUTOR

SEI Financial Services Company (the "Distributor"), a wholly-owned subsidiary
of SEI, and the Trust are parties to a distribution agreement ("Distribution
Agreement") dated May 29, 1992 which applies to Trust Shares, Investor Shares
and Flex Shares of the Fund. The Distributor will receive no compensation
for distribution of Trust Shares. In addition, the Investor Shares of the
Fund have a distribution plan ("Investor Plan"), and the Flex Shares of the
Fund have a distribution plan ("Flex Plan").

The Distribution Agreement is renewable annually and may be terminated by the
Distributor, the Qualified Trustees, or by a majority vote of the outstanding
securities of the Trust upon not more than 60 days written notice by either
party.

INVESTOR SHARES AND FLEX SHARES DISTRIBUTION PLANS

The Distribution Agreement and the Investor Plan adopted by the Trust provide
that the Investor Shares Fund will pay the Distributor a fee of up to .33% of
the average daily net assets of the Fund. The Distribution Agreement and the
Flex Plan adopted by the Trust provide that each Flex Shares Fund will pay
the Distributor a fee of up to .75% of the average daily net assets of the
Fund. The Distributor can use these fees to compensate broker-dealers and
service providers, including SunTrust and its affiliates, which provide
administrative and/or distribution services to Investor Shares or Flex Shares
Shareholders or their customers who beneficially own Investor Shares or Flex
Shares. In addition, Flex Shares are subject to a service fee of up to .25%
of the average daily net assets of the Flex Shares of the Fund. This service
fee will be used for services provided and expenses incurred in maintaining
shareholder accounts, responding to shareholder inquiries and providing
information on their investments.

These services for which broker-dealers and service providers may be
compensated may include establishing and maintaining customer accounts and
records; aggregating and processing purchase and redemption requests from
customers; placing net purchase and redemption orders with the Distributor;
automatically investing customer account cash balances; providing periodic
statements to customers; arranging for wires; answering customer inquiries
concerning their investments; assisting customers in changing dividend
options, account designations, and addresses; performing sub-accounting
functions; processing dividend payments from the Trust on behalf of
customers; and forwarding Shareholder communications from the Trust (such as
proxies, Shareholder reports, and dividend distribution, and tax notices) to
these customers with respect to investments in the

B-13
<PAGE>
Trust. Certain state securities laws may require those financial institutions
providing such distribution services to register as dealers pursuant to state
law. Although banking laws and regulations prohibit banks from distributing
shares of open-end investment companies such as the Trust, according to an
opinion issued to the staff of the SEC by the Office of the Comptroller of
the Currency, financial institutions are not prohibited from acting in other
capacities for investment companies, such as providing shareholder services.
Should future legislative, judicial or administrative action prohibit or
restrict the activities of financial institutions in connection with
providing shareholder services, the Trust may be required to alter materially
or discontinue its arrangements with such financial institutions.

The Trust has adopted the Investor Plan and the Flex Plan in each case in
accordance with the provisions of Rule 12b-1 under the 1940 Act which
regulates circumstances under which an investment company may directly or
indirectly bear expenses relating to the distribution of its shares.
Continuance of the Investor Plan and the Flex Plan must be approved annually
by a majority of the Trustees of the Trust and by a majority of the Qualified
Trustees. The Investor Plan and the Flex Plan require that quarterly written
reports of amounts spent under the Investor Plan and the Flex Plan and the
purposes of such expenditures be furnished to and reviewed by the Trustees.
The Investor Plan and the Flex Plan may not be amended to increase materially
the amount which may be spent thereunder without approval by a majority of
the outstanding shares of the Trust. All material amendments of the Plans
will require approval by a majority of the Trustees of the Trust and of the
Qualified Trustees.

None of the Flex Shares incur a sales charge when they are purchased, but
Flex Shares are subject to a sales charge if they are redeemed within one
year of purchase. Pursuant to the Distribution Agreement and the Flex Plan,
Flex Shares are subject to an ongoing distribution and service fee calculated
on the Fund's, aggregate average daily net assets attributable to its Flex
Shares.

TRUSTEES AND OFFICERS OF THE TRUST

The management and affairs of the Trust are supervised by the Trustees under
the laws governing business trusts in the Commonwealth of Massachusetts. The
Trustees and executive officers of the Trust and their principal occupations
for the last five years are set forth below.

DANIEL S. GOODRUM - Trustee - 48 Cayuga Road, Fort Lauderdale, FL 33308.
Chairman & CEO, SunBank/South Florida, N.A. from 1985 to 1991; Chairman Audit
Committee and Director, Holy Cross Hospital; Executive Committee Member and
Director, Honda Classic Foundation; Director, Broward Community College
Foundation.

WILTON LOONEY - Trustee - 2999 Circle 75 Parkway, Atlanta, GA 30339.
President of Genuine Parts Company from 1961-1964; Chairman of the Board
1964-1990; Honorary Chairman of the Board from 1990 to present. Rollins,
Inc.; RPC Energy Services, Inc.

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<PAGE>
CHAMPNEY A. MCNAIR - Trustee - 1405 Trust Co. of Georgia Building, Atlanta,
GA 30303. Director and Chairman of Investment Committee and member of
Executive Committee, Cotton States Life and Health Insurance Company;
Director and Chairman of Investment Committee and member of Executive
Committee, Cotton States Mutual Insurance Company; Chairman, Trust Company of
Georgia Advisory Council.

F. WENDELL GOOCH - Trustee - P.O. Box 190, Paoli, IN 47454. President,
Orange County Publishing Co., Inc., since October 1981. Publisher of the
Paoli News and the Paoli Republican and Editor of the Paoli Republican since
January 1981, President, H & W Distribution, Inc. since July 1984. Current
Trustee on the Board of Trustees for the SEI Family of Funds and The Capitol
Mutual Funds. Executive Vice President, Trust Department, Harris Trust and
Savings Bank and Chairman of the Board of Directors of The Harris Trust
Company of Arizona before January 1981.

T. GORDY GERMANY - Trustee - Retired President, Chairman, and CEO of Crawford
& Company; held these positions from 1973 to 1987. Member of the Board of
Directors 1970-1990, joined company in 1948; spent entire career at Crawford,
currently serves on Boards of Norrell Corporation and Mercy Health Services,
the latter being the holding company of St. Joseph's Hospitals.

DR. BERNARD F. SLIGER - Trustee - Currently on sabbatical leave from Florida
State University (1991-92); now serves as visiting professor at the
University of New Orleans. President of Florida State University (1976-91);
previous 4 years EVP and Chief Academic Officer. During educational career,
taught at Florida State, Michigan State, Louisiana State and Southern
University. Spent 19 years as faculty member and administrator at Louisiana
State University and served as Head of Economics Department, member and
Chairman of the Graduate Council, Dean of Academic Affairs and Vice
Chancellor. Member of Board of Directors of Federal Reserve Bank of Atlanta
from 1983-1988.

JESSE S. HALL - Trustee* - 988 Winall Down Road, NE, Atlanta, GA 30318.
Executive Vice President, SunTrust Banks, Inc. from 1985 to 1994; Director of
Crawford & Company since 1979; Member, Atlanta Estate Planning Council from
1988 to 1993.

DAVID G. LEE - President, Chief Executive Officer - Senior Vice President of
the Administrator and Distributor since 1993. Vice President of the
Administrator and Distributor (1991-1993). President, GW Sierra Trust Funds
before 1991.

CARMEN V. ROMEO - Treasurer, Assistant Secretary - Director, Executive Vice
President, Chief Financial Officer and Treasurer of SEI. Director and
Treasurer of the Administrator and Distributor since 1981.

RICHARD W. GRANT - Secretary - 2000 One Logan Square, Philadelphia, PA 19103,
Partner of Morgan, Lewis & Bockius LLP (law firm), Counsel to the Trust,
Administrator and Distributor.

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<PAGE>
SANDRA K. ORLOW - Vice President, Assistant Secretary - Vice President and
Assistant Secretary of the Administrator and Distributor since 1983.

KEVIN P. ROBINS - Vice President, Assistant Secretary - Senior Vice President
& General Counsel of SEI, the Administrator and the Distributor since 1994.
Vice President of SEI, the Administrator and the Distributor 1992-1994.
Associate, (law firm) prior to 1992.

KATHRYN L. STANTON - Vice President, Assistant Secretary - Vice President,
Assistant Secretary of SEI, the Administrator and Distributor since 1994.
Associate, (law firm) 1989-1994.

ROBERT B. CARROLL - Vice President, Assistant Secretary - Vice President,
Assistant Secretary of SEI, the Administrator and Distributor since 1994.
United States Securities and Exchange Commission, Division of Investment
Management, 1990-1994. Associate, McGuire, Woods, Battle & Boothe (law firm)
before 1990.

The Trustees and officers of the Trust own less than 1% of the outstanding
shares of the Trust.

- ------------------
* Jesse S. Hall may be deemed to be an "interested person" of the Trust as
defined in the Investment Company Act of 1940.

COMPUTATION OF YIELD

The current yield of the Fund will be calculated daily based upon the seven
days ending on the date of calculation ("base period"). The yield is
computed by determining the net change (exclusive of capital changes) in the
value of a hypothetical pre-existing shareholder account having a balance of
one share at the beginning of the period, subtracting a hypothetical charge
reflecting deductions from shareholder accounts, and dividing such net change
by the value of the account at the beginning of the same period to obtain the
base period return and multiplying the result by (365/7). Realized and
unrealized gains and losses are not included in the calculation of the yield.
The effective compound yield of the Fund is determined by computing the net
change, exclusive of capital changes, in the value of a hypothetical
pre-existing account having a balance of one share at the beginning of the
period, subtracting a hypothetical charge reflecting deductions from
shareholder accounts, and dividing the difference by the value of the account
at the beginning of the base period to obtain the base period return, and
then compounding the base period return by adding 1, raising the sum to a
power equal to 365 divided by 7, and subtracting 1 from the result, according
to the following formula: Effective Yield = [Base Period Return + 1) 365/7]
- - 1. The current and the effective yields reflect the reinvestment of net
income earned daily on portfolio assets.

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<PAGE>
The yield of the Fund fluctuates, and the annualization of a week's dividend
is not a representation by the Trust as to what an investment in the Fund
will actually yield in the future. Actual yields will depend on such
variables as asset quality, average asset maturity, the type of instruments
the Fund invests in, changes in interest rates on money market instruments,
changes in the expenses of the Fund and other factors.

CALCULATION OF TOTAL RETURN

From time to time, the Fund may advertise total return. In particular, total
return will be calculated according to the following formula: P (1 + T)n =
ERV, where P = a hypothetical initial payment of $1,000; T = average annual
total return; n = number of years; and ERV = ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the designated time
period as of the end of such period.

From time to time, the Trust may include the names of clients of the Advisor
in advertisements and/or sales literature for the Trust. The SEI Funds
Evaluation database tracks the total return of numerous tax-exempt pension
accounts. The range of returns in these accounts determines the percentile
rankings. SunBank has been in the top 1% of the SEI Funds Evaluation
database for equity managers over the past ten years. SEI's database
includes research data on over 1,000 investment managers responsible for over
$450 billion in assets.

PURCHASE AND REDEMPTION OF SHARES

It is currently the Trust's policy to pay for all redemptions in cash. The
Trust retains the right, however, to alter this policy to provide for
redemptions in whole or in part by a distribution in-kind of readily
marketable securities held by the Fund in lieu of cash. Shareholders may
incur brokerage charges on the sale of any such securities so received in
payment of redemptions. A Shareholder will at all times be entitled to
aggregate cash redemptions from the Fund of the Trust during any 90-day
period of up to the lesser of $250,000 or 1% of the Trust's net assets.

The Trust reserves the right to suspend the right of redemption and/or to
postpone the date of payment upon redemption for any period on which trading
on the New York Stock Exchange is restricted, or during the existence of an
emergency (as determined by the Securities and Exchange Commission by rule or
regulation) as a result of disposal or valuation of a Fund's securities is
not reasonably practicable, or for such other periods as the Securities and
Exchange Commission has by order permitted. The Trust also reserves the
right to suspend sales of shares of the Fund for any period during which the
New York Stock Exchange, an Advisor, the Administrator and/or the Custodian
are not open for business. Investors will receive written notification at
least thirty days prior to any change in the Fund's investment objective.

B-17
<PAGE>
Certain state securities laws may require those financial institutions
providing certain distribution services to the Trust to register as dealers
pursuant to state law.

DETERMINATION OF NET ASSET VALUE

The securities of the Fund are valued by the Administrator pursuant to
valuations provided by an independent pricing service. The pricing service
relies primarily on prices of actual market transactions as well as trader
quotations. However, the service may also use a matrix system to determine
valuations of fixed income securities, which system considers such factors as
security prices, yields, maturities, call features, ratings and developments
relating to specific securities in arriving at valuations. The procedures of
the pricing service and its valuations are reviewed by the officers of the
Trust under the general supervision of the Trustees.

TAXES

FEDERAL INCOME TAX

In order to qualify for treatment as a regulated investment company ("RIC")
under the Internal Revenue Code of 1986, as amended ("Code"), the Fund must
distribute annually to its Shareholders at least the sum of 90% of its net
interest income excludable from gross income plus 90% of its investment
company taxable income (generally, net investment income plus net short-term
capital gain) ("Distribution Requirement") and also must meet several
additional requirements. Among these requirements are the following: (i) at
least 90% of the Fund's gross income each taxable year must be derived from
dividends, interest, payments with respect to securities loans, and gains
from the sale or other disposition of stock or securities, or certain other
income, (ii) the Fund must derive less than 30% of its gross income each
taxable year from the sale or other disposition of stocks or securities held
for less than three months; (iii) at the close of each quarter of the Fund's
taxable year, at least 50% of the value of its total assets must be
represented by cash and cash items, U.S. Government securities, securities of
other RIC's and other securities, with such other securities limited, in
respect to any one issuer, to an amount that does not exceed 5% of the value
of the Fund's assets and that does not represent more than 10% of the
outstanding voting securities of such issuer; and (iv) at the close of each
quarter of the Fund's taxable year, not more than 25% of the value of its
assets may be invested in securities (other than U.S. Government securities
or the securities of other RIC's) of any one issuer, or of two or more
issuers engaged in same or similar businesses if the Fund owns at least 20%
of the voting power of such issuers.

Notwithstanding the Distribution Requirement described above, which only
requires a Fund to distribute at least 90% of its annual investment company
taxable income and does not require any minimum distribution of net capital
gains (the excess of net long-term capital gains over net short-term capital
loss), a Fund will be subject to a nondeductible 4% excise tax to the extent
it fails to distribute by the end of any calendar year 98% of its ordinary

B-18
<PAGE>
income for that year and 98% of its capital gain net income for the one-year
period ending on October 31 of that calendar year, plus certain other amounts.

Any gain or loss recognized on a sale or redemption of shares of a Fund by a
Shareholder who is not a dealer in securities will generally be treated as a
long-term capital gain or loss if the shares have been held for more than
twelve months and otherwise will be generally treated as a short-term capital
gain or loss. If shares on which a net capital gain distribution has been
received are subsequently sold or redeemed and such shares have been held for
six months or less, any loss recognized will be treated as a long-term
capital loss to the extent of the long-term capital gain distribution.

STATE TAXES

The Fund is not liable for any income or franchise tax in Massachusetts if it
qualifies as a RIC for federal income tax purposes. Distributions by the
Fund to Shareholders and the ownership of shares may be subject to state and
local taxes.

FOREIGN TAXES

Dividends and interests received by the Fund may be subject to income,
withholding or other taxes imposed by foreign countries and U.S. possessions
that would reduce the yield on the Fund's securities. Tax conventions
between certain countries and the United States may reduce or eliminate these
taxes. Foreign countries generally do not impose taxes on capital gains with
respect to investments by foreign investors.

If the Fund meets the distribution requirement and if more than 50% of the
value of the Fund's total assets at the close of its taxable year consists of
securities of foreign corporations, the Fund will be eligible to, and will,
file an election with the Internal Revenue Service that will enable
Shareholders, in effect, to receive the benefit of the foreign tax credit
with respect to any foreign and U.S. possessions income taxes paid by the
Fund. Pursuant to the election, the Fund will treat those taxes as dividends
paid to its Shareholders. Each Shareholder will be required to include a
proportionate share of those taxes in gross income as income received from a
foreign source and must treat the amount so included as if the Shareholder
had paid the foreign tax directly. The Shareholder may then either deduct
the taxes deemed paid by him or her in computing his or her taxable income
or, alternatively, use the foregoing information in calculating the foreign
tax credit against the Shareholders' federal income tax. If the Fund makes
the election, it will report annually to its Shareholders the respective
amounts per share of the Fund's income from sources within, and taxes paid
to, foreign countries and U.S. possessions.

The Fund's transactions in foreign currencies and forward foreign currency
contracts will be subject to special provisions of the Code that, among other
things, may affect the character of gains and losses realized by the Fund
(i.e., may effect whether gains or losses are ordinary or capital),
accelerate recognition of income to the fund and defer Fund losses.

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<PAGE>
These rules could therefore affect the character, amount and timing of
distributions to Shareholders. These provisions also may require the Fund to
mark-to-market certain types of the positions in its portfolio (i.e., treat
them as if they were closed out) which may cause the Fund to recognize income
without receiving cash with which to make distributions in amounts necessary
to satisfy the 90% and 98% distribution requirements for avoiding income and
excise taxes. The Fund will monitor its transactions, will make the
appropriate tax elections, and will make the appropriate entries in the books
and records when it acquires any foreign currency or forward foreign currency
contract in order to mitigate the effect of these rules and prevent
disqualification of the Fund as a regulated investment company and minimize
the imposition of income and excise taxes.

FUND TRANSACTIONS

The Trust has no obligation to deal with any dealer or group of dealers in
the execution of transactions in portfolio securities. Subject to policies
established by the Trustees, an Advisor is responsible for placing the
orders to execute transactions for a Fund. In placing orders, it is the
policy of the Trust to seek to obtain the best net results taking into
account such factors as price (including the applicable dealer spread), the
size, type and difficulty of the transaction involved, the firm's general
execution and operational facilities, and the firm's risk in positioning the
securities involved. While an Advisor generally seeks reasonably competitive
spreads or commissions, the Trust will not necessarily be paying the lowest
spread or commission available.

TRADING PRACTICES AND BROKERAGE

The Trust selects brokers or dealers to execute transactions for the purchase
or sale of portfolio securities on the basis of its judgment of their
professional capability to provide the service. The primary consideration is
to have brokers or dealers execute transactions at best price and execution.
Best price and execution refers to many factors, including the price paid or
received for a security, the commission charged, the promptness and
reliability of execution, the confidentiality and placement accorded the
order and other factors affecting the overall benefit obtained by the account
on the transaction. The Trust's determination of what are reasonably
competitive rates is based upon the professional knowledge of its trading
department as to rates paid and charged for similar transactions throughout
the securities industry. In some instances, the Trust pays a minimal share
transaction cost when the transaction presents no difficulty. Some trades
are made on a net basis where the Trust either buys securities directly from
the dealer or sells them to the dealer. In these instances, there is no
direct commission charged but there is a spread (the difference between the
buy and sell price) which is the equivalent of a commission.

The Trust may allocate out of all commission business generated by all of the
funds and accounts under management by an Advisor, brokerage business to
brokers or dealers who provide brokerage and research services. These
research services include advice, either directly or through publications or
writings, as to the value of securities, the advisability of

B-20
<PAGE>
investing in, purchasing or selling securities, and the availability of
securities or purchasers or sellers of securities; furnishing of analyses and
reports concerning issuers, securities or industries; providing information
on economic factors and trends, assisting in determining portfolio strategy,
providing computer software used in security analyses, and providing
portfolio performance evaluation and technical market analyses. Such
services are used by an Advisor in connection with its investment
decision-making process with respect to one or more funds and accounts
managed by it, and may not be used exclusively with respect to the fund or
account generating the brokerage.

As provided in the Securities Exchange Act of 1934 (the "1934 Act") higher
commissions may be paid to broker-dealers who provide brokerage and research
services than to broker/dealers who do not provide such services if such
higher commissions are deemed reasonable in relation to the value of the
brokerage and research services provided. Although transactions are directed
to broker-dealers who provide such brokerage and research services, the Trust
believes that the commissions paid to such broker-dealers are not, in
general, higher than commissions that would be paid to broker-dealers not
providing such services and that such commissions are reasonable in relation
to the value of the brokerage and research services provided. In addition,
portfolio transactions which generate commissions or their equivalent are
directed to broker-dealers who provide daily portfolio pricing services to
the Trust. Subject to best price and execution, commissions used for
pricing may or may not be generated by the funds receiving the pricing
service.

The Advisor may place a combined order for two or more accounts or funds
engaged in the purchase or sale of the same security if, in its judgment,
joint execution is in the best interest of each participant and will result
in best price and execution. Transactions involving commingled orders are
allocated in a manner deemed equitable to each account or fund. It is
believed that the ability of the accounts to participate in volume
transactions will generally be beneficial to the accounts and funds.
Although it is recognized that, in some cases, the joint execution of orders
could adversely affect the price or volume of the security that a particular
account or trust may obtain, it is the opinion of the Advisor and the
Trust's Board of Trustees that the advantages of combined orders outweigh the
possible disadvantages of separate transactions.

Consistent with the Rules of Fair Practice of the National Association of
Securities Dealers, Inc., and subject to seeking best price and execution,
the Funds, at the request of the Distributor, give consideration to sales of
shares of the Trust as a factor in the selection of brokers and dealers to
execute Trust portfolio transactions.

It is expected that the Trust may execute brokerage or other agency
transactions through the Distributor or an affiliate of an Advisor, both of
which are registered broker-dealers, for a commission in conformity with the
1940 Act, the 1934 Act and rules promulgated by the SEC. Under these
provisions, the Distributor or an affiliate of the Advisor is permitted to
receive and retain compensation for effecting portfolio transactions for the
Trust on an exchange if a written contract is in effect between the
Distributor and the Trust expressly

B-21
<PAGE>
permitting the Distributor or an affiliate of the Advisor to receive and
retain such compensation. These rules further require that commissions paid
to the Distributor by the Trust for exchange transactions not exceed "usual
and customary" brokerage commissions. The rules define "usual and customary"
commissions to include amounts which are "reasonable and fair compared to the
commission, fee or other renumeration received or to be received by other
brokers in connection with comparable transactions involving similar
securities being purchased or sold on a securities exchange during a
comparable period of time." In addition, the Trust may direct commission
business to one or more designated broker/dealers in connection with such
broker/dealer's provision of services to the Trust or payment of certain
Trust expenses (e.g., custody, pricing and professional fees). The Trustees,
including those who are not "interested persons" of the Trust, have adopted
procedures for evaluating the reasonableness of commissions paid to the
Distributor and will review these procedures periodically.

DESCRIPTION OF SHARES

The Declaration of Trust authorizes the issuance of an unlimited number of
shares and classes of shares of the Fund each of which represents an equal
proportionate interest in that Fund with each other share. Shares are
entitled upon liquidation to a pro rata share in the net assets of the Fund.
Shareholders have no preemptive rights. The Declaration of Trust provides
that the Trustees of the Trust may create additional series of shares or
classes of series. All consideration received by the Trust for shares of any
additional series and all assets in which such consideration is invested
would belong to that series and would be subject to the liabilities related
thereto. Share certificates representing shares will not be issued.

SHAREHOLDER LIABILITY

The Trust is an entity of the type commonly known as a "Massachusetts
Business Trust." Under Massachusetts law, shareholders of such a trust could,
under certain circumstances, be held personally liable as partners for the
obligations of the trust. Even if, however, the Trust were held to be a
partnership, the possibility of the Shareholders' incurring financial loss
for that reason appears remote because the Trust's Declaration of Trust
contains an express disclaimer of Shareholder liability for obligations of
the Trust and requires that notice of such disclaimer be given in each
agreement, obligation or instrument entered into or executed by or on behalf
of the Trust or the Trustees, and because the Declaration of Trust provides
for indemnification out of the Trust property for any Shareholder held
personally liable for the obligations of the Trust.

LIMITATION OF TRUSTEES' LIABILITY

The Declaration of Trust provides that a Trustee shall be liable only for his
own willful defaults and, if reasonable care has been exercised in the
selection of officers, agents, employees or investment advisors, shall not
be liable for any neglect or wrongdoing of any such person.

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<PAGE>
The Declaration of Trust also provides that the Trust will indemnify its
Trustees and officers against liabilities and expenses incurred in connection
with actual or threatened litigation in which they may be involved because
of their offices with the Trust unless it is determined in the manner
provided in the Declaration of Trust that they have not acted in good faith
in the reasonable belief that their actions were in the best interests of the
Trust. However, nothing in the Declaration of Trust shall protect or
indemnify a Trustee against any liability for his willful misfeasance, bad
faith, gross negligence or reckless disregard of his duties.

EXPERTS

The financial statements included in this Statement of Additional Information
have been audited by Arthur Andersen LLP, Independent Public Accountants, as
indicated in their report with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in giving said report.

B-23