<PAGE>
As filed with the Securities and Exchange Commission on April 30, 1998
Registration No. 33-47703
811-6654
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
PRE-EFFECTIVE AMENDMENT NO. [ ]
POST-EFFECTIVE AMENDMENT NO. 11 [x]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [x]
AMENDMENT NO. 14
(Check appropriate box or boxes)
BNY Hamilton Funds, Inc.
(Exact name of registrant as specified in charter)
3435 Stelzer Road 43219-3035
Columbus, Ohio (Zip Code)
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code (614) 470-8000
Copy to:
Nimish Bhatt John E. Baumgardner, Jr.
3435 Stelzer Road Sullivan & Cromwell
Columbus, Ohio 43219-3035 125 Broad Street
(Name and Address of Agent for Service) New York, New York 10004
Approximate date of proposed public offering: As soon as practicable after the
effective date of this Registration Statement. It is proposed that this filing
will become effective (check appropriate box):
/X/ immediately upon filing pursuant to paragraph (b)
/ / on (date) pursuant to paragraph (b)
/ / 60 days after filing pursuant to paragraph (a)(1)
/ / on (date) pursuant to paragraph (a)(1)
/ / 75 days after filing pursuant to paragraph (a)(2)
/ / on (date) pursuant to paragraph (a)(2), of Rule 485.
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective
date for a previously filed post-effective amendment.
The Registrant has registered an indefinite number of shares under the
Securities Act of 1933, pursuant to Rule 24f-2 of the Investment Company Act
of 1940. Registrant's Rule 24f-2 Notice for the fiscal year ended December 31,
1997, was filed with the Commission on March 30, 1998.
Total Number of Pages __________
Exhibit Number on Page __________
<PAGE>
CROSS-REFERENCE SHEET
(As required by Rule 495)
<TABLE>
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N-1A
Item No. Location
PART A Prospectus
<S> <C> <C>
Item 1. Cover Page Cover Page
Item 2. Synopsis Fee Table; Summary of Classes and Services Available for BNY Hamilton
Money Market Funds
Item 3. Condensed Financial Information Financial Highlights; Additional Information
Item 4. General Description of Registrant Cover Page; Summary of Classes and Services Available for BNY
Hamilton Money Market Funds; Investment Objectives and Policies;
Description of Securities; Additional Investment Information and Risk
Considerations; Investment Restrictions; Organization
Item 5. Management of the Fund Management of the Funds; Fund and Other Shareholder Services -
General; Additional Information; Fee Table
Item 6. Capital Stock and Other Securities Summary of Shareholder Services; Fund and Other Shareholder Services;
Purchase of Shares; Dividends and Distributions; Net Asset Value;
Organization; Taxes; Additional Information
Item 7. Purchase of Securities Being Offered Shareholder Services - Hamilton Shares; Shareholder Services -
Hamilton Premier Shares; Shareholder Services - Hamilton Classic
Shares; Fund and Other Shareholder Services - General; Purchase of
Shares; Exchange of Shares; Dividends and Distributions; Net Asset
Value
Item 8. Redemption or Repurchase Shareholder Services - Hamilton Shares; Shareholder Services -
Hamilton Premier Shares; Shareholder Services - Hamilton Classic
Shares; Fund and Other Shareholder Services - General; Redemption of
Shares; Exchange of Shares; Dividends and Distributions; Net Asset
Value
Item 9. Pending Legal Proceedings Not Applicable
PART B Statement of Additional Information
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History Additional Information
Item 13. Investment Objective and Policies Investment Objectives and Policies; Investment Restrictions
Item 14. Management of the Fund Directors and Officers
Item 15. Control Persons and Principal Holders of Description of Shares
Securities
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
N-1A
Item No. Location
<S> <C> <C>
Item 16. Investment Advisory and Other Services Directors and Officers; Investment Adviser; Administrator;
Distributor; Fund, Shareholder and Other Services; Expenses;
Financial Statements
Item 17. Brokerage Allocation Portfolio Transactions and Brokerage
Item 18. Capital Stock and Other Securities Description of Shares
Item 19 Purchase, Redemption and Pricing of Net Asset Value; Purchase of Shares; Redemption of Shares; Dividends
Securities Being Offered and Distributions; Exchange of Shares
Item 20. Tax Status Dividends and Distributions; Taxes
Item 21. Underwriters Administrator; Distributor
Item 22. Calculation of Performance Data Performance Data
Item 23. Financial Statements Financial Statements
</TABLE>
PART C
Information required to be included in Part C is set forth under the
appropriate item, so numbered in Part C of this registration statement.
<PAGE>
BNY HAMILTON MONEY MARKET FUNDS--
HAMILTON SHARES
125 West 55th Street
New York, New York 10019
For information call 1-800-426-9363 (1-800-4BNY-FND)
BNY Hamilton Funds, Inc. is a family of no-load mutual funds for which there are
no sales charges, exchange fees or redemption fees. This Prospectus describes
two (2) money market funds (individually, a 'Fund' and collectively, the
'Funds') offered by the BNY Hamilton Family of Funds.
<TABLE>
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FUND OBJECTIVE FOR INVESTORS SEEKING
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<S> <C> <C>
BNY HAMILTON To earn as high a level of current Daily dividends, liquidity,
MONEY FUND income as is consistent with and relatively low risk
preservation of capital and
maintenance of liquidity by investing
in high quality money market
instruments
- ---------------------------------------------------------------------------------------
BNY HAMILTON To earn as high a level of current Daily dividends, liquidity,
TREASURY MONEY income as is consistent with and relatively low risk
FUND preservation of capital and
maintenance of liquidity by investing
solely in short-term obligations of
the United States Treasury and
repurchase agreements fully
collateralized by obligations of the
United States Treasury
- ---------------------------------------------------------------------------------------
</TABLE>
INVESTMENTS IN EITHER FUND ARE NOT BANK DEPOSITS OR OBLIGATIONS OF OR GUARANTEED
OR INSURED BY THE BANK OF NEW YORK, AND THE SHARES IN EITHER FUND ARE NEITHER
INSURED NOR GUARANTEED BY THE UNITED STATES GOVERNMENT, THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER GOVERNMENTAL
AGENCY. ALTHOUGH BOTH FUNDS SEEK TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00
PER SHARE, THERE CAN BE NO ASSURANCE THAT EITHER FUND WILL BE ABLE TO DO SO.
This Prospectus sets forth concisely the information that a prospective investor
should know about the Funds before investing and should be retained for future
reference. Additional information about the Funds or other funds within the BNY
Hamilton Family of Funds has been filed with the Securities and Exchange
Commission in the Statement of Additional Information for BNY Hamilton Funds,
Inc., dated April 30, 1998. This information is incorporated by reference and is
available without charge upon request from the Funds' distributor, BNY Hamilton
Distributors, Inc., 125 West 55th Street, New York, New York 10019, Attention:
BNY Hamilton Funds, Inc. (1-800-4BNY-FND).
- --------------------------------------------------------------------------------
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 date of this Prospectus is April 30, 1998 5/98 BNY-0087
PROSPECTUS
<PAGE>
[This page intentionally left blank]
<PAGE>
SUMMARY OF CLASSES AND SERVICES AVAILABLE
FOR BNY HAMILTON MONEY MARKET FUNDS
<TABLE>
<CAPTION>
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INVESTMENT FOR INVESTORS SEEKING (1) SERVICES PROVIDED
- --------------------------------------------------------------------------------------------
<S> <C> <C>
HAMILTON SHARES Daily dividends and liquidity * Wire order processing
(INSTITUTIONAL * Detailed statements sent to you
INVESTORS ONLY) directly each month
* Confirmation statements mailed to
you after each transaction
</TABLE>
- ------------------------------
(1) Investors are cautioned that investments in the Funds offered hereby are not
FDIC insured.
PROSPECTUS
<PAGE>
TABLE
OF
CONTENTS
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<TABLE>
<S> <C>
Fee Table 1
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Financial Highlights 3
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Investment Objectives and Policies 5
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Description of Securities 5
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Additional Investment Information and Risk Considerations 8
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Investment Restrictions 10
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Management of the Funds 11
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Fund and Other Shareholder Services--General 12
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Shareholder Services 13
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Purchase of Shares 13
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Redemption of Shares 15
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Exchange of Shares 16
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Dividends and Distributions 17
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Net Asset Value 18
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Organization 18
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Taxes 19
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Additional Information 20
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</TABLE>
PROSPECTUS
<PAGE>
FEE
TABLE
The following table illustrates that investors in Hamilton Shares in either Fund
will incur no shareholder transaction expenses; their investments will be
subject only to the annual operating expenses set forth below.
<TABLE>
<CAPTION>
BNY HAMILTON
BNY HAMILTON TREASURY
MONEY FUND MONEY FUND
HAMILTON SHARES HAMILTON SHARES
----------------------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases........... None None
Sales Load Imposed on Reinvested
Dividends .............................. None None
Deferred Sales Load....................... None None
Redemption Fees........................... None None
Exchange Fees............................. None None
ANNUAL FUND OPERATING EXPENSES (AFTER
LIMITATIONS):
(AS A PERCENTAGE OF AVERAGE DAILY NET
ASSETS)
Management Fees (After Limitations)....... .20% .16%
12b-1 Fees................................ .00% .00%
Shareholder Servicing Fees................ .00% .00%
Other Expenses (After Limitations)........ .05% .11%
----------------------------------
Total Fund Operating Expenses (After
Limitations)............................ .25% .27%
----------------------------------
----------------------------------
EXAMPLE:
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:
</TABLE>
<TABLE>
<CAPTION>
BNY HAMILTON
BNY HAMILTON TREASURY
MONEY FUND MONEY FUND
HAMILTON SHARES HAMILTON SHARES
----------------------------------
<S> <C> <C>
1 year.................................... $ 3 $ 3
3 years................................... $ 8 $ 9
5 years................................... $14 $15
10 years.................................. $32 $34
</TABLE>
This table is designed to assist investors in understanding the various
direct and indirect costs that an investor would bear. The Adviser (as defined
in 'Management of the Funds') has agreed to limit expenses of BNY Hamilton
Treasury Money Fund to .27% of average daily net assets of its Hamilton Shares.
Had expenses not been limited, Management Fees would have been .20% for the
Hamilton Shares of BNY Hamilton Treasury Money Fund, and Total Fund Operating
Expenses would have been .33%. Expenses are not limited by the Adviser with
respect to BNY Hamilton Money Fund. Management reserves the right to implement
or discontinue expense limitations at any time. See 'Fund and Other Shareholder
Services-- General--Fee Waivers'.
PROSPECTUS (1)
<PAGE>
For a description of contractual fee arrangements or the fees and expenses
included in Other Expenses, see 'Management of the Fund' and 'Fund and Other
Shareholder Services-- General'. In connection with the example, please note
that $1,000 is less than the minimum initial investment requirement and that
there are no redemption or exchange fees of any kind. See 'Purchase of Shares'
and 'Redemption of Shares'.
THE EXAMPLE IS HYPOTHETICAL; IT IS INCLUDED SOLELY FOR ILLUSTRATIVE
PURPOSES. IT SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
PERFORMANCE; ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. EXPENSES PAID
AS SHOWN ABOVE REFLECT ESTIMATES MADE BY THE FUNDS AS OF THE DATE OF THIS
PROSPECTUS.
(2) PROSPECTUS
<PAGE>
FINANCIAL
HIGHLIGHTS
The following selected financial data of Hamilton Shares of BNY Hamilton Money
Fund was audited by KPMG Peat Marwick LLP, independent accountants for the year
ended December 31, 1997, and by Deloitte & Touche LLP, independent accountants,
for all other periods presented, whose reports thereon appear in the Fund's
annual reports. This information should be read in conjunction with the
financial statements and related notes that also appear in the Fund's Annual
Report dated December 31, 1997 which is incorporated by reference into the
Statement of Additional Information.
<TABLE>
<CAPTION>
HAMILTON SHARES
---------------------------------------------------------------------
FOR THE
PERIOD
AUGUST 7,
1992*
YEAR ENDED DECEMBER 31, THROUGH
------------------------------------------------------ DECEMBER 31,
1997 1996 1995 1994 1993 1992
---------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at
beginning
of period............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income..... 0.053 0.052 0.057 0.040 0.030 0.012
---------------------------------------------------------------------
DIVIDENDS
Dividends from net
investment income....... (0.053) (0.052) (0.057) (0.040) (0.030) (0.012)
---------------------------------------------------------------------
Net asset value at end
of period............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------
---------------------------------------------------------------------
TOTAL RETURN:............. 5.47% 5.30% 5.84% 4.02% 3.03% 1.26%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of
period (000's
omitted)................ $1,063,579 $609,424 $604,053 $235,220 $307,395 $135,852
Ratio to average net
assets of:
Expenses, net of waiver
from The Bank of
New York.............. 0.25% 0.27% 0.26% 0.30% 0.27% 0.20%***
Expenses, prior to
waiver from The Bank
of New York .......... 0.25% 0.27% 0.26% 0.32% 0.32% 0.49%***
Net investment income,
net of waiver from The
Bank of New York...... 5.34% 5.17% 5.67% 3.92% 2.97% 3.11%***
</TABLE>
- ------------------------------
* Commencement of investment operations.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Money Fund is
contained in the Fund's annual report to shareholders, which may be obtained
from the distributor, BNY Hamilton Distributors, Inc., upon request and without
charge.
PROSPECTUS (3)
<PAGE>
The following selected financial data of Hamilton Shares of BNY Hamilton
Treasury Money Fund was audited by KPMG Peat Marwick LLP, independent
accountants, whose report thereon appears in the Fund's annual report. This
information should be read in conjunction with the financial statements and
related notes that also appear in the Fund's Annual Report dated December 31,
1997 which is incorporated by reference into the Statement of Additional
Information.
<TABLE>
<CAPTION>
HAMILTON SHARES
-----------------
FOR THE PERIOD
APRIL 1, 1997*
THROUGH
DECEMBER 31, 1997
-----------------
<S> <C>
PER SHARE DATA:
Net asset value at beginning of period........................... $ 1.00
--------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................................ 0.040
--------
DIVIDENDS
Dividends from net investment income............................. (0.040)
--------
Net asset value at end of period................................. $ 1.00
--------
--------
TOTAL RETURN:.................................................... 4.02%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's omitted)...................... $ 110,719
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New York.............. 0.25%***
Expenses, prior to waiver from The Bank of New York............ 0.33%***
Net investment income, net of waiver from The Bank of New
York......................................................... 5.29%***
</TABLE>
- ------------------------------
* Commencement of investment operations.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Treasury Money
Fund is contained in the Fund's annual report to shareholders, which may be
obtained from the distributor, BNY Hamilton Distributors, Inc., upon request and
without charge.
(4) PROSPECTUS
<PAGE>
INVESTMENT OBJECTIVES
AND POLICIES
The investment objective of each of the Funds is described below, together with
the policies each Fund will employ in its efforts to achieve its objective.
There can be no assurance that the Funds will attain its investment objective.
INTRODUCTION
The Funds are open-end management investment companies (commonly known as mutual
funds) registered under the Investment Company Act of 1940 (the '1940 Act').
Each Fund is considered a separate pool of assets with its own distinctive
investment objective and policies, as described below.
BNY HAMILTON MONEY FUND
(the 'Money Fund')
The Money Fund's investment objective is to earn as high a level of current
income as is consistent with preservation of capital and maintenance of
liquidity by investing in high quality money market instruments.
BNY HAMILTON TREASURY MONEY FUND
(the 'Treasury Money Fund')
The Treasury Money Fund's investment objective is to earn as high a level of
current income as is consistent with preservation of capital and maintenance of
liquidity by investing solely in short-term obligations of the United States
Treasury and repurchase agreements fully collateralized by obligations of the
United States Treasury.
Each Fund will maintain a dollar-weighted average portfolio maturity of not
more than 90 days and will only purchase securities having a remaining maturity
of 397 days or less.
Because each Fund only invests in high quality money market securities
(limited, in the case of the Treasury Money Fund, to U.S. Government Securities,
see 'Additional Investment Information and Risk Considerations'), the Funds may
not be able to achieve as high a level of current income under all market
conditions as would be possible if they were permitted to invest in lower
quality and longer term securities, which generally are less liquid, have
greater market risk and are subject to more fluctuation of market value.
DESCRIPTION
OF SECURITIES
UNITED STATES GOVERNMENT OBLIGATIONS
The Treasury Money Fund will, and the Money Fund may, invest in obligations
issued or guaranteed by the United States Government or, in the case of the
Money Fund, by its agencies or instrumentalities. Securities that are backed by
the full faith and credit of the United States include Treasury bills, Treasury
bonds and obligations of the Government National Mortgage Association,
PROSPECTUS (5)
<PAGE>
the Farmers Home Administration and the Export-Import Bank. Obligations issued
or guaranteed by federal agencies or instrumentalities are not always backed by
the 'full faith and credit' of the United States. The Money Fund may invest in
obligations that are not backed by the full faith and credit of the United
States and, in the case of such investments, the Money Fund must look
principally to the agency issuing or guaranteeing the obligations for legitimate
repayment. Securities in which the Money Fund may invest that are not backed by
the full faith and credit of the United States include, but are not limited to,
obligations of the Federal National Mortgage Association, the Tennessee Valley
Authority, the Federal Farm Credit System and Federal Home Loan Banks. A Fund
may also invest in component parts of United States Treasury notes or bonds,
namely either the corpus (principal) of such Treasury obligations or one of the
interest payments scheduled to be paid on such obligations. Certain arrangements
by which such components are offered have been created by private sponsors, such
as investment banks and securities dealers, and are not United States Government
securities.
BANK OBLIGATIONS
As is consistent with its credit quality parameters, the Money Fund may invest
in high quality negotiable certificates of deposit, time deposits and bankers'
acceptances of domestic and foreign issuers. Investments in such obligations
will be limited, at the time of investment, to the obligations of domestic banks
that are subject to regulatory supervision by the United States Government or
state governments, and the obligations of foreign banks with branches or
agencies in the United States.
Investments in foreign banks and foreign branches of United States banks
involve certain risks not generally associated with investments in domestic
banks. While domestic banks are required to maintain certain reserves and are
subject to other regulations, such requirements and regulations may not apply to
foreign branches. Investments in foreign banks and branches may also be subject
to other risks, including future political and economic developments, the
seizure or nationalization of foreign deposits and the establishment of exchange
controls or other restrictions. For more information about foreign investments,
see 'Additional Investment Information and Risk Considerations--Foreign
Investment Risk'.
The Money Fund may also invest in obligations of international banking
institutions designated or supported by national governments to promote economic
reconstruction, development or trade between nations (e.g., the World Bank, the
Inter-American Development Bank and the European Investment Bank). These
obligations may be supported by appropriated but unpaid commitments of their
member countries, and there is no assurance these commitments will be undertaken
or met in the future.
(6) PROSPECTUS
<PAGE>
COMMERCIAL PAPER
The Money Fund may invest in high quality commercial paper issued by domestic
issuers. The Money Fund may also invest in the commercial paper of foreign
issuers provided the commercial paper is United States dollar-denominated. For
more information about foreign investments, see 'Additional Investment
Information and Risk Considerations--Foreign Investment Risk'.
REPURCHASE AGREEMENTS
Each Fund may invest in securities generally referred to as repurchase
agreements, provided the agreements are entered into with dealers meeting credit
criteria established by the Board of Directors of BNY Hamilton Funds, Inc. (the
'Directors'), monitored by each Fund's investment adviser and fully
collateralized by (i) United States Government (and, in the case of the Money
Fund, United States agency or instrumentality) obligations or (ii) in the case
of the Money Fund, other securities rated in the highest rating category by one
or more Nationally Recognized Statistical Rating Organizations ('NRSROs') at the
time of purchase. See 'Quality Information' for a further description of certain
NRSROs. Also see 'Additional Investment Information and Risk
Considerations--Repurchase Agreements' for a discussion of further risks
associated with repurchase agreements.
CORPORATE BONDS AND NOTES
The Money Fund may invest in high quality corporate bonds and notes issued by
United States corporations. The Money Fund may also invest in the bonds of
foreign issuers provided the bonds are United States dollar-denominated and are
not subject to foreign withholding tax.
FOREIGN GOVERNMENT OBLIGATIONS
The Money Fund may invest in short-term obligations of foreign sovereign
governments or of their agencies, instrumentalities, authorities or political
subdivisions, provided the short-term obligations are United States
dollar-denominated. For the purpose of applying the Money Fund's fundamental
concentration policy, it will consider each sovereign government, together with
all of its agencies, instrumentalities, authorities and political subdivisions,
as being engaged in the same industry. See 'Investment Restrictions'.
QUALITY INFORMATION
Each Fund will limit its investments to those securities that, in accordance
with guidelines adopted by the Directors, present minimal credit risks and are
'First Tier Securities' (as defined in Rule 2a-7 promulgated under the 1940 Act)
at the time of acquisition. The term 'First Tier Securities' generally includes
securities rated by the requisite NRSROs in the highest short-term rating
categories, securities of issuers that have received such ratings with respect
to other comparable short-term debt securities and comparable unrated
securities. Requisite NRSROs means (a) any two NRSROs that have issued a rating
with respect to a
PROSPECTUS (7)
<PAGE>
security or class of debt obligations of an issuers, or (b) one NRSRO, if only
one NRSRO has issued such a rating at the time that the respective Fund acquires
the security. Currently, there are six NRSROs: Standard & Poor's Ratings Group,
Moody's Investors Service, Inc., Fitch Investors Services, L.P., Duff and
Phelps/MCM, IBCA Limited and its affiliate, IBCA, Inc. and Thomson Bankwatch.
The ratings categories of Standard & Poor's and Moody's Investors Service are
described in the Appendix to the Statement of Additional Information. The Money
Fund generally may not invest more than 5% of its total assets in the securities
of any one issuer, except for United States government securities.
ADDITIONAL INVESTMENT
INFORMATION AND
RISK CONSIDERATIONS
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
The Money Fund may purchase securities on a when-issued or delayed delivery
basis. Delivery of and payment for these securities may take as long as a month
or more after the date of the purchase commitment. The value of these securities
is subject to market fluctuation during this period and no interest or income
accrues to the Money Fund until settlement. The Money Fund will maintain with
its custodian a separate account with a segregated portfolio of liquid assets
consisting of cash, United States government securities or other liquid,
high-grade debt securities in an amount at least equal to these commitments.
When entering into a when-issued or delayed delivery transaction, the Money Fund
is relying on the other party to consummate the transaction; if the other party
fails to do so, the Money Fund may be disadvantaged. It is the current policy of
the Money Fund not to enter into when-issued commitments exceeding in the
aggregate 15% of the market value of its total assets less liabilities other
than the obligations created by these commitments.
REPURCHASE AGREEMENTS
Both Funds may enter into repurchase agreements with brokers, dealers or banks
that meet the credit guidelines established by the Directors. In a repurchase
agreement, a Fund buys a security from a seller that has agreed to repurchase it
at a mutually agreed upon date and at a price reflecting the interest rate
effective for the term of the agreement. The term of these agreements is usually
from overnight to one week. A repurchase agreement may be viewed as a fully
collateralized loan of money by a Fund to the seller. A Fund always receives, as
collateral, securities with a market value at least equal to the purchase price
plus accrued interest and this value is maintained during the term of the
agreement. If the seller defaults and the collateral value declines, a Fund
might incur a loss. If bankruptcy proceedings are commenced with respect to the
seller, a Fund's realization upon the collateral may be delayed or limited.
Investments in certain repurchase agreements and certain other investments that
may be considered illiquid are limited as set forth under 'Investment
Restrictions'.
(8) PROSPECTUS
<PAGE>
REVERSE REPURCHASE AGREEMENTS
The Money Fund is permitted to enter into reverse repurchase agreements. In a
reverse repurchase agreement, the Money Fund sells a security and agrees to
repurchase it at a mutually agreed upon date and at a price reflecting the
interest rate effective for the term of the agreement. It may also be viewed as
the borrowing of money by the Money Fund. The Money Fund will not invest the
proceeds of a reverse repurchase agreement for a period which exceeds the
duration of the reverse repurchase agreement. The Money Fund may not enter into
reverse repurchase agreements exceeding in the aggregate one-third of the market
value of its total assets, less liabilities other than the obligations created
by reverse repurchase agreements. The Money Fund will establish and maintain
with its custodian a separate account with a segregated portfolio of liquid
assets consisting of cash, United States Government securities or other liquid,
high-grade debt securities in an amount at least equal to its purchase
obligations under its reverse repurchase agreements.
If interest rates rise during the term of a reverse repurchase agreement,
entering into the reverse repurchase agreement may have a negative impact on the
Money Fund's ability to maintain a net asset value of $1.00 per share for each
class of shares. Reverse repurchase agreements also involve the risk that the
market value of the securities retained by the Money Fund may decline below the
price of the securities it has sold but is obligated to repurchase under the
agreement. In the event the buyer of securities under a reverse repurchase
agreement files for bankruptcy or becomes insolvent, the Money Fund's use of
proceeds from the agreement may be restricted pending a determination by the
other party or its trustee or receiver whether to enforce the Money Fund's
obligation to repurchase the securities.
FOREIGN INVESTMENT RISK
The Money Fund may invest in certain foreign securities, as described in
'Description of Securities'. Investments in obligations of foreign issuers,
foreign sovereign governments, and in foreign branches of domestic banks
involves somewhat different investment risks from those affecting obligations of
United States domestic issuers. For example, there may be limited publicly
available information with respect to foreign issuers, and foreign issuers are
not generally subject to uniform accounting, auditing and financial standards
and requirements comparable to those applicable to domestic institutions. There
may be also be less government supervision than in the United States. Foreign
markets have substantially less trading volume than domestic markets and
securities of some foreign issuers are less liquid and more volatile than
securities of comparable domestic issuers. Brokerage commissions and other
transaction costs in foreign markets are generally higher than in the United
States. Interest paid by foreign issuers may be subject to withholding and other
foreign taxes that may decrease the net return on foreign investments as
compared to investments the Money Fund may make in securities of domestic
institutions. Additional risks include the potential impact of adverse future
political and economic developments, the possibility that a foreign jurisdiction
might impose or change withholding taxes on income payable with respect to
foreign securities, the possible seizure, nationalization or expropriation of
one or more foreign issuers or foreign deposits and the possible adoption of
foreign governmental restrictions such as exchange controls. The Money Fund's
investment adviser takes these foreign investment risks into consideration when
making investment decisions.
PROSPECTUS (9)
<PAGE>
VARIABLE AND FLOATING RATE INSTRUMENTS
While the Funds will generally only invest in securities that mature within 397
days of the date of purchase, the Money Fund may invest in variable and floating
rate instruments that have stated final maturities in excess of 397 days if such
instruments meet and comply with conditions established by the Securities and
Exchange Commission.
INVESTMENT
RESTRICTIONS
As the Funds are diversified series of a registered investment company, 75% of
the assets of each Fund is subject to the following limitations: (a) the
particular Fund may not invest more than 5% of its total assets in the
securities of any one issuer, except obligations of the United States Government
and its agencies and instrumentalities, and (b) the particular Fund may not own
more than 10% of the outstanding voting securities of any one issuer. Both Funds
are subject to additional requirements governing money market funds that use the
amortized cost method to value assets. These requirements generally prohibit the
Funds from investing more than 5% of their respective total assets in the
securities of any single issuer, except obligations of the United States
Government and its agencies and instrumentalities.
Each Fund also operates under certain investment restrictions that,
together with its investment objective, are deemed fundamental policies of the
Fund--i.e., they may only be changed with the approval of the holders of a
majority of the relevant Fund's outstanding shares. Neither Fund may: (i)
acquire any illiquid securities if, as a result, more than 10% of the market
value of its net assets would be in investments that are illiquid; (ii) enter
into reverse repurchase agreements exceeding one-third of the market value of
its total assets, less liabilities other than obligations created by reverse
repurchase agreements; (iii) borrow money, except from banks for extraordinary
or emergency purposes, and then only in amounts up to 20% of the value of the
Fund's total assets (taken at cost at time of borrowing) and except in
connection with permitted reverse repurchase agreements; or mortgage, pledge, or
hypothecate any assets except in connection with any borrowing in amounts up to
20% of the value of the Fund's net assets at the time of borrowing; (iv)
purchase securities while borrowing (including reverse repurchase agreements)
exceeds 5% of its total assets; or (v) invest more than 25% of its assets in any
one industry, except that the Fund may invest more than 25% of its assets in
securities and other instrumentalities issued by banks and bank holding
companies organized under the laws of the United States or any state thereunder.
In addition, the Directors have adopted as an operating policy, which may
not be changed without approval of a majority of the outstanding shares, that
the Money Fund may not: (i) purchase any short-term debt securities unless such
securities are rated as described in 'Description of Securities--Quality
Information' or, if not so rated, securities determined to be of comparable
quality in accordance with procedures established by the Directors; (ii)
purchase securities that cannot be offered for public sale in the United States
without first being registered under the Securities Act of 1933, as amended,
including but not limited to securities that can be purchased pursuant to Rule
144A of said Act, and (iii) lend its securities. Restriction (iii) is also
applicable to the Treasury Money Fund.
(10) PROSPECTUS
<PAGE>
For a more detailed discussion of the above investment restrictions,
including a description of applicability to each Fund, see 'Investment
Restrictions and Additional Information' in the Statement of Additional
Information.
MANAGEMENT
OF THE FUNDS
DIRECTORS
Pursuant to the Articles of Incorporation and Bylaws of BNY Hamilton Funds,
Inc., the Directors decide upon matters of general policy and review the actions
of the investment adviser, administrator, distributor and other service
providers to each Fund. The Statement of Additional Information contains the
name and general business experience of each Director.
INVESTMENT ADVISER
The Bank of New York serves as each Fund's investment adviser (the 'Adviser').
The Adviser, which has its principal offices at 48 Wall Street, New York, New
York 10286, is New York's first bank, founded by Alexander Hamilton in 1784, and
is one of the largest commercial banks in the United States, having over $60
billion in assets at December 31, 1997. It is the leading retail bank in the
greater New York suburban area, having 363 branches at December 31, 1997. As of
December 31, 1997, the Adviser provided administrative or advisory services to
approximately $42 billion in assets.
The Adviser will manage the investments of each Fund and will be
responsible for all purchases and sales of each Fund's portfolio securities. The
Adviser's fee accrues daily and is payable monthly at the annual rate of .10% of
average daily net assets of each Fund.
ADMINISTRATOR
BNY Hamilton Distributors, Inc. ('BNY Hamilton Distributors') serves as
administrator (the 'Administrator') to, and will assist generally in supervising
the operations of, each Fund. BNY Hamilton Distributors is a Delaware
corporation organized to administer and distribute mutual funds; its offices are
located at 3435 Stelzer Road, Columbus, Ohio 43219-3035.
The Administration Agreement requires the Administrator to provide
facilities, equipment and personnel to carry out administrative services for
each Fund, including, among other things, providing the services of persons who
may be appointed as officers and directors of BNY Hamilton Funds, Inc.,
overseeing the performance of the transfer agent (as described in 'Fund and
Other Shareholder Services--General--Transfer Agent'), supervising purchase and
redemption orders (made via telephone, mail and direct deposit), and monitoring
the Distributor's compliance with the rules and regulations of the National
Association of Securities Dealers and federal and state securities laws (also
see 'Distributor' below). The Administrator is responsible for coordinating and
overseeing compliance by the Directors with Maryland corporate procedural
requirements (as the Funds are series of a Maryland corporation; see
'Organization'). The Administrator also assists in updating and printing the
Funds' prospectus
PROSPECTUS (11)
<PAGE>
and statement of additional information, administering shareholder meetings,
producing proxy statements and annual and semi-annual reports, monitoring the
Adviser's compliance with the stated investment objectives and restrictions of
each Fund and monitoring the custodian, fund accounting, transfer agency,
administration, distribution, advisory and legal services that are provided to
each Fund.
The Administration Agreement permits the Administrator to delegate certain
of its responsibilities to other service providers. Pursuant to this authority,
The Bank of New York provides certain administrative functions for the
Administrator. The Bank of New York is not an affiliated person of BNY Hamilton
Distributors.
Each Fund pays administration fees that are accrued daily and payable
monthly at the rate of .10% of average daily net assets of such Fund.
DISTRIBUTOR
In addition to acting as Administrator, BNY Hamilton Distributors will be the
exclusive underwriter and distributor of shares of each Fund (the
'Distributor').
The Distributor will make a continuous offering of each Fund's shares and
will bear the costs and expenses of distributing to selected dealers and
prospective investors copies of any prospectuses, statements of additional
information and annual and interim reports of the Funds (after such items have
been prepared, printed and sent by the Funds at their expense to existing
shareholders) that are used in connection with the offering of shares, and the
costs and expenses of preparing, printing and distributing any other literature
used by the Distributor or furnished by it for use by selected dealers in
connection with the offering of each Fund's shares for sale to the public.
FUND AND OTHER
SHAREHOLDER SERVICES--GENERAL
CUSTODIAN AND FUND ACCOUNTING AGENT
The Bank of New York, 90 Washington Street, New York, New York 10286, serves as
each Fund's custodian. Each Fund has also entered into a Cash Management and
Related Services Agreement with The Bank of New York pursuant to which The Bank
of New York, as custodian, receives and disburses funds in connection with
purchases and redemptions of the Fund's shares.
The Bank of New York also serves as the fund accounting agent for each Fund
with responsibility for calculating the net asset value per share for the
Hamilton class of each Fund thereof and for maintaining the books and records of
the Hamilton class of each Fund.
TRANSFER AGENT
BISYS Fund Services, Inc. is the transfer agent for the Hamilton class of shares
of each Fund. BISYS Fund Services, Inc. is a wholly-owned subsidiary of The
BISYS Group, Inc. ('BISYS'). BISYS owns BNY Hamilton Distributors, Inc., the
Funds' Administrator and Distributor. The transfer agent maintains the account
records of shareholders of each Fund and administers the distribution of any
dividends or distributions declared by the Funds.
(12) PROSPECTUS
<PAGE>
FEE WAIVERS
Except as noted in this Prospectus and the Statement of Additional Information,
the Funds' service contractors bear all expenses in connection with the
performance of their services and each Fund (and each class thereof) bears the
expenses incurred in its operation. From time to time during the course of the
Funds' fiscal year, each of the Administrator and the Adviser may voluntarily
elect not to receive payment of fees under their respective agreements described
above and/or to assume certain expenses of a Fund (or class thereof), while
retaining the ability to be reimbursed by such Fund for such amount prior to the
end of the fiscal year. This will have the effect of increasing yield to
investors at the time such fees are not requested to be paid to, or amounts are
assumed by, the Administrator or the Adviser and decreasing yield when such fees
or amounts are reimbursed to the Administrator or the Adviser.
SHAREHOLDER
SERVICES
Purchase orders for Hamilton Shares of the Funds must be transmitted to the
transfer agent by telephone c/o the Distributor (1-800-363-7925) or by terminal
access.
PURCHASES VIA PROCEDURES ESTABLISHED BY THE BANK OF NEW YORK
Shares may be purchased through procedures established by The Bank of New York
in connection with certain of its customer accounts. The Funds expect that The
Bank of New York will transmit orders on behalf of its customers for the
purchase of Fund shares on an omnibus basis. This Prospectus should be read in
conjunction with any material provided by The Bank of New York regarding such
procedures.
REGULAR REDEMPTION
Redemption orders for Hamilton Shares must be transmitted to the transfer agent
by telephone c/o the Distributor in the manner described for purchases at the
beginning of this section. While each Fund seeks to maintain the net asset value
per Hamilton Share at $1.00, there can be no assurance that it will be able to
do so, and accordingly the proceeds paid upon redemption may be more or less
than the amount invested depending upon a share's net asset value at the time of
redemption.
PURCHASE
OF SHARES
Fund shares are sold at the net asset value per share next determined after
receipt of a purchase order by the transfer agent. The Funds do not impose any
fee for purchase orders placed directly with the transfer agent without the
assistance of a broker-dealer. Broker-dealers (other than the Distributor) and
others who process purchase orders on behalf of customers may charge a fee for
their services.
PROSPECTUS (13)
<PAGE>
Purchase orders for shares are accepted by a Fund only on a day on which
both the New York Stock Exchange and the custodian are open for business (a
'Business Day'). As used herein, a 'Business Day' is a day on which the New York
Stock Exchange is open for trading and any other day (other than a day on which
no shares of a Fund are tendered for redemption and no order to purchase shares
is received) during which there is sufficient trading in the Fund's portfolio
securities that the Fund's net asset value per share might be materially
affected.
Purchase orders received by the transfer agent before 4:30 p.m. Eastern
time on a Business Day for either Fund will be executed as of the times noted
for the respective Fund, if payment is received by the times noted for the
respective Fund. Orders received after the times noted for the respective Fund,
and orders for which payment has not been received by the times noted for the
respective Fund, will not be accepted. A Fund may in its discretion reject any
order for shares. Payment for orders which are not received or paid for in a
timely manner or are not accepted by a Fund will be returned after prompt
notification to the sending institution. On those days when the New York Stock
Exchange or the custodian closes early as a result of such day being a partial
holiday or otherwise, the right is reserved to advance the time on that day by
which purchase orders and redemption requests must be received.
Payment for shares may be made only in federal funds or other funds
immediately available to the transfer agent. Purchases made by check are not
permitted to be redeemed until payment of the purchase has been collected, which
may take up to ten business days after purchase. The Funds reserve the right to
suspend the sale of shares to the public at any time, in response to conditions
in the securities markets or otherwise.
Investors in Hamilton Shares are automatically entitled to purchase
additional Fund shares by telephone unless they notify the transfer agent in
writing that they do not wish to use this telephone privilege. There is no
charge for the telephone purchase privilege.
The Distributor, from time to time, at its expense, will provide
compensation to dealers in connection with sales of shares of any other funds in
the BNY Hamilton Family of Funds. Such compensation will include non-cash
payments which may take the form of (1) gift certificates, (2) tickets for
entertainment events, (3) trips, including the provision of travel arrangements
and lodging at vacation resorts and (4) merchandise. Dealers may not use sales
of any Funds' shares to qualify for this compensation to the extent such sales
may be prohibited by laws of any state or any self-regulatory agency, such as
the National Association of Securities Dealers, Inc. None of the aforementioned
compensation is paid for by any series of BNY Hamilton Funds, Inc. or its
shareholders.
Federal regulations require that each investor provide a certified Taxpayer
Identification Number (social security number for individuals) upon opening or
reopening an account with a Fund. Investors should refer to the section entitled
'Taxes' for further information about this requirement.
In the interest of economy and convenience and because of its operating
procedures, the Funds will not issue certificates representing ownership of
shares. All shares purchased will be confirmed and credited to investors'
accounts on the books maintained by the Adviser or its agents for the relevant
Fund.
(14) PROSPECTUS
<PAGE>
REDEMPTION
OF SHARES
Redemption orders are effected at the net asset value per share next determined
after receipt of the order by the transfer agent. Payment for redeemed shares
for which a redemption order is received by the transfer agent prior to 4:30
p.m. Eastern time for either Fund on a Business Day is normally made in federal
funds wired to the redeeming shareholder on the same Business Day. Payment for
redeemed shares for which a redemption order is received after the time stated
above on a Business Day is normally made in federal funds wired to the redeeming
shareholder on the next Business Day following redemption. In order to allow The
Bank of New York to most effectively manage each Fund, investors are urged to
initiate redemptions of shares as early in the day as possible and to notify the
transfer agent at least one day in advance of redemptions in excess of $5
million. The Funds reserve the right to wire redemption proceeds up to seven
days after receiving the redemption order if, in the judgment of the Adviser, an
earlier payment could adversely affect a Fund. Investors in Hamilton Shares are
automatically entitled to redeem shares, without charge, by telephone, unless
they notify the transfer agent in writing that they do not wish to use this
telephone privilege.
None of the Funds, the Distributor, the transfer agent or the Funds' other
service contractors will be responsible for any loss or expense for acting upon
telephone instructions that they believe to be genuine. In attempting to confirm
that telephone instructions are genuine, the Funds and their service contractors
will use such procedures as they consider reasonable as described in 'Redemption
of Shares' in the Statement of Additional Information. To the extent that the
Funds or their service contractors do not use reasonable procedures to form
their belief as to the genuineness of accountholders' instructions, it and/or
its service contractors may be responsible for such instructions as are
fraudulent or unauthorized.
Redemption orders submitted directly to the transfer agent without the
assistance of a broker-dealer or other person, and orders submitted by the
Distributor for its brokerage customers, are processed without charge.
Broker-dealers (other than the Distributor) and others who process redemption
orders on behalf of their customers may charge a fee for their services.
The Funds may suspend the right of redemption or postpone the date of
payment upon redemption (as well as suspend or postpone the recordation of the
transfer of its shares) for such periods as are permitted under the 1940 Act.
The Funds reserve the right to redeem Hamilton Shares in any account at their
net asset value if the value of the account is less than $500,000 as a result of
redemptions. The shareholder having the account will first be notified in
writing that its account has a value of less than $500,000 and will be allowed
60 days to make additional investments to bring the value of its account to
$500,000 before the redemption is processed by the Fund. In addition, the Funds
may redeem Hamilton Shares under certain special circumstances described in the
Statement of Additional Information under 'Redemption of Shares'.
PROSPECTUS (15)
<PAGE>
Hamilton Shares may be redeemed through procedures established by The Bank
of New York in connection with certain of its customer accounts. In many
instances, these procedures will include instructions under which Hamilton
Shares are redeemed automatically in amounts necessary to maintain a specific
previously agreed upon balance in the customer's account at The Bank of New
York. This Prospectus should be read in conjunction with any material provided
by The Bank of New York regarding such procedures. Similar arrangements may also
be available from Shareholder Organizations other than The Bank of New York.
EXCHANGE
OF SHARES
An investor may exchange shares between the Funds described in this prospectus
and any other fund in the BNY Hamilton Family of Funds described in the relevant
prospectuses for the Equity Funds, the Taxable Fixed Income Funds or the
Tax-Exempt Fixed Income Funds.
Shareholders of either Fund must request and obtain a current copy of the
relevant prospectus before exchanging their investment in the Money Fund or the
Treasury Money Fund for an initial investment in one of the other members of the
BNY Hamilton Family of Funds. Investors considering such an exchange of shares
are urged to read the relevant prospectus carefully prior to exchange.
For details regarding an exchange for Institutional Shares of any other BNY
Hamilton Fund, contact your Bank of New York representative for details.
An exchange may be made for Investor Shares of any other BNY Hamilton Fund,
so long as the shares to be exchanged have a value of at least $500, and the
shares to be purchased in the exchange may legally be sold in the state of the
investor's residence. If a shareholder is establishing a NEW account by
exchange, shares of the specific Fund being exchanged must have a value at least
equal to the minimum initial investment required by the specific Fund into which
the exchange is being made (currently $2,000 for Investor Shares for each of the
Equity Funds, the Taxable Fixed Income Funds and the Tax-Exempt Fixed Income
Funds). Shares will be exchanged on the basis of relative net asset value per
share.
An investment in the Money Fund or Treasury Money Fund automatically
entitles an investor to use the exchange privilege unless he or she indicates on
the Account Application or in a subsequent written notice to the transfer agent
that he or she does not wish to use this privilege. The relevant prospectuses
for the other portfolios of the BNY Hamilton Family of Funds into which an
exchange is being made may be obtained from the investor's Service Organization
or the Distributor. A shareholder may exchange shares by telephone by calling
the transfer agent at 1-800-952-6276. Telephone privileges will be suspended for
a period of ten days following a change of address. See 'Redemption of Shares'
in the Statement of Additional Information for a description of the Funds'
policy regarding responsibility for telephone instructions. An investor desiring
to use the exchange privilege should read the Statement of Additional
Information and consult his or her Service Organization or the Distributor for
further information applicable to use of the exchange privilege. The BNY
Hamilton Family of Funds reserves the right to reject any
(16) PROSPECTUS
<PAGE>
exchange request and the exchange privilege may be modified or terminated at
any time. At least 60 days' notice will be given to shareholders of any
material modification or termination except where notice is not required under
regulations of the Securities and Exchange Commission.
Exchanges are in effect redemptions from one member of the BNY Hamilton
Family of Funds and purchases of another member of the BNY Hamilton Family of
Funds and the usual purchase and redemption procedures and requirements are
applicable to exchanges. Also see 'Purchase of Shares' and 'Redemption of
Shares' in this prospectus and the other prospectuses.
DIVIDENDS AND
DISTRIBUTIONS
The net investment income for Hamilton Shares of each Fund's shares will be
declared as dividends daily and paid monthly within five (5) Business Days after
the end of the month. Dividends and distributions will be payable to
shareholders of record at the time of declaration.
The net investment income of Hamilton Shares of each Fund for each Business
Day will be determined immediately prior to the determination of net asset
value. Net investment income for other days will be determined on the prior
Business Day. Shares of Hamilton Shares of each Fund will begin earning
dividends on the Business Day their purchase is effective. See 'Purchase of
Shares' and 'Redemption of Shares'. The Directors may, without action by the
shareholders, revise the dividend policy or postpone the payment of a dividend
by a Fund if it incurs or anticipates any large unexpected expense, loss or
fluctuation in net assets that in the Directors' opinion might have a
significant adverse effect on shareholders.
Dividends on shares of each Fund generally are determined in the same
manner regardless of class, except that Hamilton Premier Shares and Hamilton
Classic Shares (not included herein) bear the fees paid to their respective
Shareholder Organizations. In addition, Hamilton Classic Shares of the Money
Fund bear 12b-1 fees, and each class of shares bears certain other miscellaneous
'class specific expenses' (i.e., certain registration and transfer agency
expenses).
If you elect to receive distributions in cash, and the checks (1) are
returned and marked as 'undeliverable' or (2) remain uncashed for six months,
your cash election will be changed automatically and your future dividend and
capital gains distributions will be reinvested in the respective Fund at the per
share net asset value determined as of the date of payment of the distribution.
In addition, any undeliverable checks or checks that remain uncashed for six
months will be canceled and will be reinvested in the respective Fund at the per
share net asset value determined as of the date of cancellation.
The Funds do not expect to realize long-term capital gains or losses.
However, should a Fund do so, any net realized gains will be distributed at
least annually.
PROSPECTUS (17)
<PAGE>
NET ASSET
VALUE
Net asset value per share for the Hamilton Shares of each Fund will be
determined by subtracting from the value of the relevant Fund's total assets
attributable to that class the amount of such Fund's liabilities attributable to
shares of that class, dividing the remainder by the number of outstanding shares
of that class and rounding to the nearest one cent. Expenses, including the fees
payable to the Adviser and the Administrator, are accrued daily. Each Fund will
value its portfolio securities using the amortized cost method. This method
attempts to maintain a constant net asset value per share of $1.00. No
assurances can be given that this goal will be attained. See 'Net Asset Value'
in the Statement of Additional Information for more information on valuation of
portfolio securities of the Funds.
Each Fund computes the net asset value of the Hamilton Shares once daily on
Monday through Friday, except that the net asset value need not be computed on a
day in which no orders to purchase or redeem Hamilton Shares have been received
or on the holidays listed under 'Net Asset Value' in the Statement of Additional
Information. Each Fund will compute net asset value of its respective classes at
4:30 P.M. Eastern time.
ORGANIZATION
BNY Hamilton Funds, Inc. is an open-end management investment company organized
as a Maryland corporation on May 1, 1992. The Articles of Incorporation
currently permit BNY Hamilton Funds, Inc. to issue 20,000,000,000 shares of
common stock, par value $.001 per share, which have been allocated as follows:
<TABLE>
<CAPTION>
NUMBER OF
NAME OF FUND AND CLASSES THEREOF SHARES AUTHORIZED
- -----------------------------------------------------------------------------------
<S> <C>
BNY Hamilton Money Fund--Hamilton Shares....................... 3,000,000,000
BNY Hamilton Treasury Money Fund--Hamilton Shares.............. 2,000,000,000
</TABLE>
The Directors may increase the number of shares each Fund is authorized to
issue without the approval of shareholders. The Directors also have the power to
designate one or more series or classes of shares of common stock and to
classify and reclassify any unissued shares with respect to such series or
classes.
Shareholders of each series of BNY Hamilton Funds, Inc. are entitled to one
vote for each share and to the appropriate fractional vote for each fractional
share. There is no cumulative voting and the Fund's shares have no preemptive or
conversion rights. All shareholders will vote together as a single class on
matters affecting the relevant Fund generally, including matters relating to the
relevant Fund's investment advisory agreement, investment objective and
fundamental investment restrictions. Shareholders of a particular class will
vote separately on any matters relating only to that class.
(18) PROSPECTUS
<PAGE>
Shares offered hereby must be fully-paid upon issuance and thereafter will
be non- assessable by BNY Hamilton Funds, Inc. and the particular Fund to which
they belong. The Funds do not intend to hold meetings of shareholders. The
Directors may call meetings of shareholders for action by shareholder vote as
may be required by the 1940 Act or permitted by the Articles of Incorporation or
Bylaws of BNY Hamilton Funds, Inc.
BNY Hamilton Funds, Inc., if requested to do so by the holders of at least
10% of the shares of all series aggregated as a class, will call a meeting of
shareholders for the purpose of voting upon the removal of a director or
directors and will assist in communications with other shareholders as required
by Section 16(c) of the 1940 Act. For further organization information,
including certain shareholder rights, see 'Description of Shares' in the
Statement of Additional Information.
TAXES
The following discussion of federal tax consequences is based on the United
States tax laws in effect on the date of this Prospectus. These laws and
regulations are subject to change by legislative, judicial or administrative
action. Investors are urged to consult their own tax advisors with respect to
specific questions as to federal taxes and with respect to the applicability of
state, local or foreign taxes. See 'Taxes' in the Statement of Additional
Information. Annual statements as to the federal tax status of distributions
will be mailed to shareholders shortly after the end of the taxable year.
Each Fund intends to qualify as a regulated investment company under
Subchapter M of the Tax Code. As a regulated investment company, each Fund will
not be subject to federal income taxes on the net investment income and capital
gains distributed to shareholders, provided that it distributes annually at
least 90% of its net investment income and realized net short-term capital gains
in excess of net long-term capital losses.
Distributions of net investment income and realized net short-term capital
gains in excess of net long-term capital losses will be taxable to shareholders
of a Fund as ordinary income, whether such distributions are taken in cash or
reinvested in additional shares. Such distributions will not be eligible for the
dividends-received deduction.
Distributions of net long-term capital gains in excess of net short-term
capital losses, if any, will be taxable to shareholders of a Fund as long-term
capital gains regardless of how long the shareholders have held their shares and
regardless of whether taken in cash or reinvested in additional shares.
Long-term capital gains distributions will not be eligible for the dividends-
received deduction. Individual shareholders will be subject to federal income
tax on distributions of net long-term capital gains at a maximum rate of 28% if
designated as derived from a Fund's capital gains from property held for more
than one year and at a maximum rate of 20% if designated as derived from
property held for more than eighteen months.
UNLESS A SHAREHOLDER INCLUDES ITS TAXPAYER IDENTIFICATION NUMBER (SOCIAL
SECURITY NUMBER FOR INDIVIDUALS) ON THE ACCOUNT APPLICATION AND CERTIFIES THAT
IT IS NOT SUBJECT TO BACKUP WITHHOLDING, A FUND MAY BE REQUIRED TO WITHHOLD AND
REMIT TO THE U.S. TREASURY 31% OF TAXABLE DISTRIBUTIONS AND OTHER REPORTABLE
PAYMENTS TO THE SHAREHOLDER. SHAREHOLDERS SHOULD BE AWARE THAT, UNDER
REGULATIONS PROMULGATED BY THE INTERNAL REVENUE SERVICE, A FUND MAY BE FINED UP
TO $50 ANNUALLY FOR EACH ACCOUNT FOR WHICH A CERTIFIED TAXPAYER IDENTIFICATION
NUMBER IS NOT PROVIDED. IN THE EVENT THAT SUCH A FINE IS IMPOSED WITH RESPECT TO
ANY UNCERTIFIED ACCOUNT IN ANY YEAR, A CORRESPONDING CHARGE MAY BE MADE AGAINST
THAT ACCOUNT.
PROSPECTUS (19)
<PAGE>
ADDITIONAL
INFORMATION
The Funds will send to their shareholders annual and semi-annual reports. The
financial statements appearing in the annual reports will be audited by
independent auditors. Shareholders will also receive confirmations of each
purchase and redemption and monthly statements, reflecting all account activity,
including dividends reinvested in additional shares or credited as cash. Written
inquiries should be addressed to the specific Fund as follows:
BNY Hamilton Funds
P. O. Box 163310
Columbus, OH 43216-3310
The Funds may make historical performance information available and may
advertise yield and effective yield as those terms are defined in the Statement
of Additional Information under Performance Data. The yield for the Hamilton
Shares of each Fund may be compared to the yield of other mutual funds with
similar investment objectives and services and to other relevant indices or to
rankings prepared by independent services or other financial or industry
publications that monitor the performance of mutual funds. For example, the
yield for the Hamilton Shares of each Fund may be compared to Money Fund Report,
a service of IBC Financial Data, Inc. Yield data as reported in national
financial publications, including but not limited to Money, Forbes, Barrons, The
Wall Street Journal and The New York Times, or in publications of a local or
regional nature, may also be used in comparing each Fund's yield. All
performance figures will be based on historical earnings and are not intended to
indicate future performance. Performance information may be obtained by calling
the Distributor at (1-800-4BNY-FND).
(20) PROSPECTUS
<PAGE>
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<PAGE>
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<PAGE>
BNY HAMILTON MONEY MARKET FUNDS--
HAMILTON PREMIER SHARES
125 West 55th Street
New York, New York 10019
For information call 1-800-426-9363 (1-800-4BNY-FND)
BNY Hamilton Funds, Inc. is a family of no-load mutual funds for which there are
no sales charges, exchange or redemption fees. This Prospectus describes two (2)
money market funds (individually, a 'Fund' and collectively, the 'Funds')
offered by the BNY Hamilton Family of Funds.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
FUND OBJECTIVE FOR INVESTORS SEEKING
- ---------------------------------------------------------------------------------------
<S> <C> <C>
BNY HAMILTON To earn as high a level of current Daily dividends, liquidity,
MONEY FUND income as is consistent with and relatively low risk
preservation of capital and
maintenance of liquidity by investing
principally in high quality money
market instruments
- ---------------------------------------------------------------------------------------
BNY HAMILTON To earn as high a level of current Daily dividends, liquidity,
TREASURY MONEY income as is consistent with and relatively low risk
FUND preservation of capital and
maintenance of liquidity by investing
solely in short-term obligations of
the United States Treasury and
repurchase agreements fully
collateralized by obligations of the
United States Treasury
- ---------------------------------------------------------------------------------------
</TABLE>
INVESTMENTS IN EITHER FUND ARE NOT BANK DEPOSITS OR OBLIGATIONS OF OR GUARANTEED
OR INSURED BY THE BANK OF NEW YORK, AND THE SHARES IN EITHER FUND ARE NEITHER
INSURED NOR GUARANTEED BY THE UNITED STATES GOVERNMENT, THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER GOVERNMENTAL
AGENCY. ALTHOUGH BOTH FUNDS SEEK TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00
PER SHARE, THERE CAN BE NO ASSURANCE THAT EITHER FUND WILL BE ABLE TO DO SO.
This Prospectus sets forth concisely the information that a prospective investor
should know about the Funds before investing and should be retained for future
reference. Additional information about the Funds or other funds within the BNY
Hamilton Family of Funds has been filed with the Securities and Exchange
Commission in the Statement of Additional Information for BNY Hamilton Funds,
Inc., dated April 30, 1998. This information is incorporated by reference and is
available without charge upon request from the Funds' distributor, BNY Hamilton
Distributors, Inc., 125 West 55th Street, New York, New York 10019, Attention:
BNY Hamilton Funds, Inc. (1-800-4BNY-FND).
- --------------------------------------------------------------------------------
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 date of this Prospectus is April 30, 1998 5/98 BNY-0088
PROSPECTUS
<PAGE>
[This page intentionally left blank]
<PAGE>
SUMMARY OF CLASSES AND SERVICES AVAILABLE
FOR BNY HAMILTON MONEY MARKET FUNDS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------
INVESTMENT FOR INVESTORS SEEKING (1) SERVICES PROVIDED
- ----------------------------------------------------------------------------------------
<S> <C> <C>
HAMILTON PREMIER SHARES Daily dividends and liquidity * Wire order processing
(INSTITUTIONAL through a sweep facility * Detailed statements sent to
INVESTORS ONLY) you directly each month
* Confirmation statements
mailed to you after each
transaction
* Automatic investment of
assets via a 'sweep' facility,
pursuant to specific
preauthorized instructions
</TABLE>
- ------------------------------
(1) Investors are cautioned that investments in the Funds offered hereby are not
FDIC insured.
PROSPECTUS
<PAGE>
TABLE
OF
CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Fee Table 1
- --------------------------------------------------------------------
Financial Highlights 3
- --------------------------------------------------------------------
Investment Objectives and Policies 5
- --------------------------------------------------------------------
Description of Securities 5
- --------------------------------------------------------------------
Additional Investment Information and Risk Considerations 8
- --------------------------------------------------------------------
Investment Restrictions 10
- --------------------------------------------------------------------
Management of the Funds 11
- --------------------------------------------------------------------
Fund and Other Shareholder Services--General 12
- --------------------------------------------------------------------
Shareholder Services 14
- --------------------------------------------------------------------
Purchase of Shares 15
- --------------------------------------------------------------------
Redemption of Shares 16
- --------------------------------------------------------------------
Exchange of Shares 17
- --------------------------------------------------------------------
Dividends and Distributions 18
- --------------------------------------------------------------------
Net Asset Value 19
- --------------------------------------------------------------------
Organization 20
- --------------------------------------------------------------------
Taxes 20
- --------------------------------------------------------------------
Additional Information 21
- --------------------------------------------------------------------
</TABLE>
PROSPECTUS
<PAGE>
FEE
TABLE
The following table illustrates that investors in the Funds will incur no
shareholder transaction expenses; their investments will be subject only to the
annual operating expenses set forth below.
<TABLE>
<CAPTION>
BNY HAMILTON
BNY HAMILTON TREASURY
MONEY FUND MONEY FUND
HAMILTON HAMILTON
PREMIER SHARES PREMIER SHARES
--------------------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases............ None None
Sales Load Imposed on Reinvested
Dividends................................ None None
Deferred Sales Load........................ None None
Redemption Fees............................ None None
Exchange Fees.............................. None None
ANNUAL FUND OPERATING EXPENSES
(AFTER LIMITATIONS):
(AS A PERCENTAGE OF AVERAGE DAILY NET
ASSETS)
Management Fees (After Limitations)........ .20% .16%
12b-1 Fees................................. .00% .00%
Shareholder Servicing Fees................. .25% .25%
Other Expenses............................. .06% .11%
--------------------------------
Total Fund Operating Expenses (After
Limitations)............................. .51% .52%
--------------------------------
--------------------------------
EXAMPLE:
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:
</TABLE>
<TABLE>
<CAPTION>
BNY HAMILTON
BNY HAMILTON TREASURY
MONEY FUND MONEY FUND
HAMILTON HAMILTON
PREMIER SHARES PREMIER SHARES
--------------------------------
<S> <C> <C>
1 year..................................... $ 5 $ 5
3 years.................................... $16 $17
5 years.................................... $29 $29
10 years................................... $64 $65
</TABLE>
PROSPECTUS (1)
<PAGE>
This table is designed to assist investors in understanding the various
direct and indirect costs that an investor would bear. The Adviser (as defined
in 'Management of the Funds') has agreed to limit expenses of BNY Hamilton
Treasury Money Fund to .52% of average daily net assets of its Hamilton Premier
Shares. Had expenses not been limited, Management Fees would have been .20% of
the Hamilton Premier Shares of BNY Hamilton Treasury Money Fund, and Total Fund
Operating Expenses would have been .56%. Expenses are not limited by the Adviser
with respect to BNY Hamilton Money Fund. Management reserves the right to
implement or discontinue expense limitations at any time. See 'Fund and Other
Shareholder Services--General--Fee Waivers'.
For a description of contractual fee arrangements or the fees and expenses
included in Other Expenses, see 'Management of the Fund' and 'Fund and Other
Shareholder Services - General'. In connection with the example, please note
that $1,000 is less than the minimum initial investment requirement and that
there are no redemption or exchange fees of any kind. See 'Purchase of Shares'
and 'Redemption of Shares'.
THE EXAMPLE IS HYPOTHETICAL; IT IS INCLUDED SOLELY FOR ILLUSTRATIVE
PURPOSES. IT SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
PERFORMANCE; ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. EXPENSES PAID
AS SHOWN ABOVE REFLECT ESTIMATES MADE BY THE FUNDS AS OF THE DATE OF THIS
PROSPECTUS.
(2) PROSPECTUS
<PAGE>
FINANCIAL
HIGHLIGHTS
The following selected financial data of Hamilton Premier Shares of BNY Hamilton
Money Fund was audited by KPMG Peat Marwick LLP, independent accountants for the
year ended December 31, 1997, and by Deloitte & Touche LLP, independent
accountants, for all other periods presented, whose reports thereon appear in
the Fund's annual reports. This information should be read in conjunction with
the financial statements and related notes that also appear in the Fund's Annual
Report dated December 31, 1997 which is incorporated by reference into the
Statement of Additional Information.
<TABLE>
<CAPTION>
HAMILTON PREMIER SHARES
--------------------------------------------------
FOR THE
PERIOD
AUGUST 15,
1994*
YEAR ENDED DECEMBER 31, THROUGH
---------------------------------- DECEMBER 31,
1997 1996 1995 1994
--------------------------------------------------
<S> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period.............................. $ 1.00 $ 1.00 $ 1.00 $ 1.00
--------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................. 0.051 0.049 0.054 0.017
--------------------------------------------------
DIVIDENDS
Dividends from net investment
income.............................. (0.051) (0.049) (0.054) (0.017)
--------------------------------------------------
Net asset value at end of period...... $ 1.00 $ 1.00 $ 1.00 $ 1.00
--------------------------------------------------
--------------------------------------------------
TOTAL RETURN:......................... 5.19% 5.03% 5.54% 1.69%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted)............................ $688,339 $463,759 $340,163 $107,799
Ratio to average net assets of:
Expenses............................ 0.51% 0.53% 0.54% 0.61%***
Net investment income............... 5.09% 4.91% 5.40% 4.40%***
</TABLE>
- ------------------------------
* Commencement of investment operations.
** Not annualized.
*** Annualized.
Further information about the performance of the BNY Hamilton Money Fund is
contained in the Fund's annual report to shareholders, which may be obtained
from the distributor, BNY Hamilton Distributors, Inc., upon request and without
charge.
PROSPECTUS (3)
<PAGE>
The following selected financial data of Hamilton Premier Shares of BNY Hamilton
Treasury Money Fund was audited by KPMG Peat Marwick LLP, independent
accountants, whose report thereon appears in the Fund's annual report. This
information should be read in conjunction with the financial statements and
related notes that also appear in the Fund's Annual Report dated December 31,
1997 which is incorporated by reference into the Statement of Additional
Information.
<TABLE>
<CAPTION>
HAMILTON
PREMIER
SHARES
-----------------
FOR THE PERIOD
APRIL 1,
1997*
THROUGH
DECEMBER 31,
1997
-----------------
<S> <C>
PER SHARE DATA:
Net asset value at beginning of period......................... $ 1.00
--------
INCOME FROM INVESTMENT OPERATIONS
Net investment income.......................................... 0.038
--------
DIVIDENDS
Dividends from net investment income........................... (0.038)
--------
Net asset value at end of period............................... $ 1.00
--------
--------
TOTAL RETURN:.................................................. 3.83%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's omitted).................... $ 183,895
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New York............ 0.50%***
Expenses, prior to waiver from The Bank of New York.......... 0.56%***
Net investment income, net of waiver from The Bank of New
York....................................................... 5.06%***
</TABLE>
- ------------------------------
* Commencement of investment operations.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Treasury Money Fund is
contained in the Fund's annual report to shareholders, which may be obtained
from the distributor, BNY Hamilton Distributors, Inc., upon request and without
charge.
(4) PROSPECTUS
<PAGE>
INVESTMENT OBJECTIVES
AND POLICIES
The investment objective of each of the Funds is described below, together with
the policies each Fund will employ in its efforts to achieve its objective.
There can be no assurance that the Funds will attain its investment objective.
INTRODUCTION
The Funds are open-end management investment companies (commonly known as mutual
funds) registered under the Investment Company Act of 1940 (the '1940 Act').
Each Fund is considered a separate pool of assets with its own distinctive
investment objective and policies, as described below.
BNY HAMILTON MONEY FUND
(The 'Money Fund')
The Money Fund's investment objective is to earn as high a level of current
income as is consistent with preservation of capital and maintenance of
liquidity by investing in high quality money market instruments.
BNY HAMILTON TREASURY MONEY FUND
(The 'Treasury Money Fund')
The Treasury Money Fund's investment objective is to earn as high a level of
current income as is consistent with preservation of capital and maintenance of
liquidity by investing solely in short-term obligations of the United States
Treasury and repurchase agreements fully collateralized by obligations of the
United States Treasury.
Each Fund will maintain a dollar-weighted average portfolio maturity of not
more than 90 days and will only purchase securities having a remaining maturity
of 397 days or less.
Because each Fund only invests in high quality money market securities
(limited, in the case of the Treasury Money Fund, to U.S. Government Securities,
see 'Additional Investment Information and Risk Considerations'), the Funds may
not be able to achieve as high a level of current income under all market
conditions as would be possible if they were permitted to invest in lower
quality and longer term securities, which generally are less liquid, have
greater market risk and are subject to more fluctuation of market value.
DESCRIPTION
OF SECURITIES
UNITED STATES GOVERNMENT OBLIGATIONS
The Treasury Money Fund will, and the Money Fund may, invest in obligations
issued or guaranteed by the United States Government or, in the case of the
Money Fund, by its agencies or instrumentalities. Securities that are backed by
the full faith and credit of the United States include Treasury bills, Treasury
bonds and obligations of the Government National Mortgage
PROSPECTUS (5)
<PAGE>
Association, the Farmers Home Administration and the Export-Import Bank.
Obligations issued or guaranteed by federal agencies or instrumentalities are
not always backed by the 'full faith and credit' of the United States. The Money
Fund may invest in obligations that are not backed by the full faith and credit
of the United States and, in the case of such investments, the Money Fund must
look principally to the agency issuing or guaranteeing the obligations for
legitimate repayment. Securities in which the Money Fund may invest that are not
backed by the full faith and credit of the United States include, but are not
limited to, obligations of the Federal National Mortgage Association, the
Tennessee Valley Authority, the Federal Farm Credit System and Federal Home Loan
Banks. A Fund may also invest in component parts of United States Treasury notes
or bonds, namely either the corpus (principal) of such Treasury obligations or
one of the interest payments scheduled to be paid on such obligations. Certain
arrangements by which such components are offered have been created by private
sponsors, such as investment banks and securities dealers, and are not United
States Government securities.
BANK OBLIGATIONS
As is consistent with its credit quality parameters, the Money Fund may invest
in high quality negotiable certificates of deposit, time deposits and bankers'
acceptances of domestic and foreign issuers. Investments in such obligations
will be limited, at the time of investment, to the obligations of domestic banks
that are subject to regulatory supervision by the United States Government or
state governments, and the obligations of foreign banks with branches or
agencies in the United States.
Investments in foreign banks and foreign branches of United States banks
involve certain risks not generally associated with investments in domestic
banks. While domestic banks are required to maintain certain reserves and are
subject to other regulations, such requirements and regulations may not apply to
foreign branches. Investments in foreign banks and branches may also be subject
to other risks, including future political and economic developments, the
seizure or nationalization of foreign deposits and the establishment of exchange
controls or other restrictions. For more information about foreign investments,
see 'Additional Investment Information and Risk Considerations--Foreign
Investment Risk'.
The Money Fund may also invest in obligations of international banking
institutions designated or supported by national governments to promote economic
reconstruction, development or trade between nations (e.g., the World Bank, the
Inter-American Development Bank and the European Investment Bank). These
obligations may be supported by appropriated but unpaid commitments of their
member countries, and there is no assurance these commitments will be undertaken
or met in the future.
COMMERCIAL PAPER
The Money Fund may invest in high quality commercial paper issued by domestic
issuers. The Money Fund may also invest in the commercial paper of foreign
issuers provided the commercial paper is United States dollar-denominated. For
more information about foreign investments, see 'Additional Investment
Information and Risk Considerations--Foreign Investment Risk'.
(6) PROSPECTUS
<PAGE>
REPURCHASE AGREEMENTS
Each Fund may invest in securities generally referred to as repurchase
agreements, provided the agreements are entered into with dealers meeting credit
criteria established by the Board of Directors of BNY Hamilton Funds, Inc. (the
'Directors'), monitored by each Fund's investment adviser and fully
collateralized by (i) United States Government (and, in the case of the Money
Fund, United States agency or instrumentality) obligations or (ii) in the case
of the Money Fund, other securities rated in the highest rating category by one
or more Nationally Recognized Statistical Rating Organizations ('NRSROs') at the
time of purchase. See 'Quality Information' for a further description of certain
NRSROs. Also see 'Additional Investment Information and Risk
Considerations--Repurchase Agreements' for a discussion of further risks
associated with repurchase agreements.
CORPORATE BONDS AND NOTES
The Money Fund may invest in high quality corporate bonds and notes issued by
United States corporations. The Money Fund may also invest in the bonds of
foreign issuers provided the bonds are United States dollar-denominated and are
not subject to foreign withholding tax.
FOREIGN GOVERNMENT OBLIGATIONS
The Money Fund may invest in short-term obligations of foreign sovereign
governments or of their agencies, instrumentalities, authorities or political
subdivisions, provided the short-term obligations are United States
dollar-denominated. For the purpose of applying the Money Fund's fundamental
concentration policy, it will consider each sovereign government, together with
all of its agencies, instrumentalities, authorities and political subdivisions,
as being engaged in the same industry. See 'Investment Restrictions'.
QUALITY INFORMATION
Each Fund will limit its investments to those securities that, in accordance
with guidelines adopted by the Directors, present minimal credit risks and are
'First Tier Securities' (as defined in Rule 2a-7 promulgated under the 1940 Act)
at the time of acquisition. The term 'First Tier Securities' generally includes
securities rated by the requisite NRSROs in the highest short-term rating
categories, securities of issuers that have received such ratings with respect
to other comparable short-term debt securities and comparable unrated
securities. Requisite NRSROs means (a) any two NRSROs that have issued a rating
with respect to a security or class of debt obligations of an issuers, or (b)
one NRSRO, if only one NRSRO has issued such a rating at the time that the
respective Fund acquires the security. Currently, there are six NRSROs: Standard
& Poor's Ratings Group, Moody's Investors Service, Inc., Fitch Investors
Services, L.P., Duff and Phelps/MCM, IBCA Limited and its affiliate, IBCA, Inc.
and Thomson Bankwatch. The ratings categories of Standard & Poor's and Moody's
Investors Service are described in the Appendix to the Statement of Additional
Information. The Money Fund generally may not invest more than 5% of its total
assets in the securities of any one issuer, except for United States government
securities.
PROSPECTUS (7)
<PAGE>
ADDITIONAL INVESTMENT
INFORMATION AND
RISK CONSIDERATIONS
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
The Money Fund may purchase securities on a when-issued or delayed delivery
basis. Delivery of and payment for these securities may take as long as a month
or more after the date of the purchase commitment. The value of these securities
is subject to market fluctuation during this period and no interest or income
accrues to the Money Fund until settlement. The Money Fund will maintain with
its custodian a separate account with a segregated portfolio of liquid assets
consisting of cash, United States government securities or other liquid,
high-grade debt securities in an amount at least equal to these commitments.
When entering into a when-issued or delayed delivery transaction, the Money Fund
is relying on the other party to consummate the transaction; if the other party
fails to do so, the Money Fund may be disadvantaged. It is the current policy of
the Money Fund not to enter into when-issued commitments exceeding in the
aggregate 15% of the market value of its total assets less liabilities other
than the obligations created by these commitments.
REPURCHASE AGREEMENTS
Both Funds may enter into repurchase agreements with brokers, dealers or banks
that meet the credit guidelines established by the Directors. In a repurchase
agreement, a Fund buys a security from a seller that has agreed to repurchase it
at a mutually agreed upon date and at a price reflecting the interest rate
effective for the term of the agreement. The term of these agreements is usually
from overnight to one week. A repurchase agreement may be viewed as a fully
collateralized loan of money by a Fund to the seller. A Fund always receives, as
collateral, securities with a market value at least equal to the purchase price
plus accrued interest and this value is maintained during the term of the
agreement. If the seller defaults and the collateral value declines, a Fund
might incur a loss. If bankruptcy proceedings are commenced with respect to the
seller, a Fund's realization upon the collateral may be delayed or limited.
Investments in certain repurchase agreements and certain other investments that
may be considered illiquid are limited as set forth under 'Investment
Restrictions'.
REVERSE REPURCHASE AGREEMENTS
The Money Fund is permitted to enter into reverse repurchase agreements. In a
reverse repurchase agreement, the Money Fund sells a security and agrees to
repurchase it at a mutually agreed upon date and at a price reflecting the
interest rate effective for the term of the agreement. It may also be viewed as
the borrowing of money by the Money Fund. The Money Fund will not invest the
proceeds of a reverse repurchase agreement for a period which exceeds the
duration of the reverse repurchase agreement. The Money Fund may not enter into
reverse repurchase agreements exceeding in the aggregate one-third of the market
value of its
(8) PROSPECTUS
<PAGE>
total assets, less liabilities other than the obligations created by reverse
repurchase agreements. The Money Fund will establish and maintain with its
custodian a separate account with a segregated portfolio of liquid assets
consisting of cash, United States Government securities or other liquid,
high-grade debt securities in an amount at least equal to its purchase
obligations under its reverse repurchase agreements.
If interest rates rise during the term of a reverse repurchase agreement,
entering into the reverse repurchase agreement may have a negative impact on the
Money Fund's ability to maintain a net asset value of $1.00 per share for each
class of shares. Reverse repurchase agreements also involve the risk that the
market value of the securities retained by the Money Fund may decline below the
price of the securities it has sold but is obligated to repurchase under the
agreement. In the event the buyer of securities under a reverse repurchase
agreement files for bankruptcy or becomes insolvent, the Money Fund's use of
proceeds from the agreement may be restricted pending a determination by the
other party or its trustee or receiver whether to enforce the Money Fund's
obligation to repurchase the securities.
FOREIGN INVESTMENT RISK
The Money Fund may invest in certain foreign securities, as described in
'Description of Securities'. Investments in obligations of foreign issuers,
foreign sovereign governments, and in foreign branches of domestic banks
involves somewhat different investment risks from those affecting obligations of
United States domestic issuers. For example, there may be limited publicly
available information with respect to foreign issuers, and foreign issuers are
not generally subject to uniform accounting, auditing and financial standards
and requirements comparable to those applicable to domestic institutions. There
may be also be less government supervision than in the United States. Foreign
markets have substantially less trading volume than domestic markets and
securities of some foreign issuers are less liquid and more volatile than
securities of comparable domestic issuers. Brokerage commissions and other
transaction costs in foreign markets are generally higher than in the United
States. Interest paid by foreign issuers may be subject to withholding and other
foreign taxes that may decrease the net return on foreign investments as
compared to investments the Money Fund may make in securities of domestic
institutions. Additional risks include the potential impact of adverse future
political and economic developments, the possibility that a foreign jurisdiction
might impose or change withholding taxes on income payable with respect to
foreign securities, the possible seizure, nationalization or expropriation of
one or more foreign issuers or foreign deposits and the possible adoption of
foreign governmental restrictions such as exchange controls. The Money Fund's
investment adviser takes these foreign investment risks into consideration when
making investment decisions.
VARIABLE AND FLOATING RATE INSTRUMENTS
While the Funds will generally only invest in securities that mature within 397
days of the date of purchase, the Money Fund may invest in variable and floating
rate instruments that have stated final maturities in excess of 397 days if such
instruments meet and comply with conditions established by the Securities and
Exchange Commission.
PROSPECTUS (9)
<PAGE>
INVESTMENT
RESTRICTIONS
As the Funds are diversified series of a registered investment company, 75% of
the assets of each Fund is subject to the following limitations: (a) the
particular Fund may not invest more than 5% of its total assets in the
securities of any one issuer, except obligations of the United States Government
and its agencies and instrumentalities, and (b) the particular Fund may not own
more than 10% of the outstanding voting securities of any one issuer. Both Funds
are subject to additional requirements governing money market funds that use the
amortized cost method to value assets. These requirements generally prohibit the
Funds from investing more than 5% of their respective total assets in the
securities of any single issuer, except obligations of the United States
Government and its agencies and instrumentalities.
Each Fund also operates under certain investment restrictions that,
together with its investment objective, are deemed fundamental policies of the
Fund--i.e., they may only be changed with the approval of the holders of a
majority of the relevant Fund's outstanding shares. Neither Fund may: (i)
acquire any illiquid securities if, as a result, more than 10% of the market
value of its net assets would be in investments that are illiquid; (ii) enter
into reverse repurchase agreements exceeding one-third of the market value of
its total assets, less liabilities other than obligations created by reverse
repurchase agreements; (iii) borrow money, except from banks for extraordinary
or emergency purposes, and then only in amounts up to 20% of the value of the
Fund's total assets (taken at cost at time of borrowing) and except in
connection with permitted reverse repurchase agreements; or mortgage, pledge, or
hypothecate any assets except in connection with any borrowing in amounts up to
20% of the value of the Fund's net assets at the time of borrowing; (iv)
purchase securities while borrowing (including reverse repurchase agreements)
exceeds 5% of its total assets; or (v) invest more than 25% of its assets in any
one industry, except that the Fund may invest more than 25% of its assets in
securities and other instrumentalities issued by banks and bank holding
companies organized under the laws of the United States or any state thereunder.
In addition, the Directors have adopted as an operating policy, which may
not be changed without approval of a majority of the outstanding shares, that
the Money Fund may not: (i) purchase any short-term debt securities unless such
securities are rated as described in 'Description of Securities--Quality
Information' or, if not so rated, securities determined to be of comparable
quality in accordance with procedures established by the Directors; (ii)
purchase securities that cannot be offered for public sale in the United States
without first being registered under the Securities Act of 1933, as amended,
including but not limited to securities that can be purchased pursuant to Rule
144A of said Act, and (iii) lend its securities. Restriction (iii) is also
applicable to the Treasury Money Fund.
For a more detailed discussion of the above investment restrictions,
including a description of applicability to each Fund, see 'Investment
Restrictions and Additional Information' in the Statement of Additional
Information.
(10) PROSPECTUS
<PAGE>
MANAGEMENT
OF THE FUNDS
DIRECTORS
Pursuant to the Articles of Incorporation and Bylaws of BNY Hamilton Funds,
Inc., the Directors decide upon matters of general policy and review the actions
of the investment adviser, administrator, distributor and other service
providers to each Fund. The Statement of Additional Information contains the
name and general business experience of each Director.
INVESTMENT ADVISER
The Bank of New York serves as each Fund's investment adviser (the 'Adviser').
The Adviser, which has its principal offices at 48 Wall Street, New York, New
York 10286, is New York's first bank, founded by Alexander Hamilton in 1784, and
is one of the largest commercial banks in the United States, having over $60
billion in assets at December 31, 1997. It is the leading retail bank in the
greater New York suburban area, having 363 branches at December 31, 1997. As of
December 31, 1997, the Adviser provided administrative or advisory services to
approximately $42 billion in assets.
The Adviser will manage the investments of each Fund and will be
responsible for all purchases and sales of each Fund's portfolio securities. The
Adviser's fee accrues daily and is payable monthly at the annual rate of .10% of
average daily net assets of each Fund.
ADMINISTRATOR
BNY Hamilton Distributors, Inc. ('BNY Hamilton Distributors') serves as
administrator (the 'Administrator') to, and will assist generally in supervising
the operations of, each Fund. BNY Hamilton Distributors is a Delaware
corporation organized to administer and distribute mutual funds; its offices are
located at 3435 Stelzer Road, Columbus, Ohio 43219-3035.
The Administration Agreement requires the Administrator to provide
facilities, equipment and personnel to carry out administrative services for
each Fund, including, among other things, providing the services of persons who
may be appointed as officers and directors of BNY Hamilton Funds, Inc.,
overseeing the performance of the transfer agent (as described in 'Fund and
Other Shareholder Services--General--Transfer Agent'), supervising purchase and
redemption orders (made via telephone, mail and direct deposit), and monitoring
the Distributor's compliance with the rules and regulations of the National
Association of Securities Dealers and federal and state securities laws (also
see 'Distributor' below). The Administrator is responsible for coordinating and
overseeing compliance by the Directors with Maryland corporate procedural
requirements (as the Funds are series of a Maryland corporation; see
'Organization'). The Administrator also assists in updating and printing the
Funds' prospectus and statement of additional information, administering
shareholder meetings, producing proxy statements and annual and semi-annual
reports, monitoring the Adviser's compliance with the stated investment
objectives and restrictions of each Fund and monitoring the custodian, fund
accounting, transfer agency, administration, distribution, advisory and legal
services that are provided to each Fund.
PROSPECTUS (11)
<PAGE>
The Administration Agreement permits the Administrator to delegate certain
of its responsibilities to other service providers. Pursuant to this authority,
The Bank of New York provides certain administrative functions for the
Administrator. The Bank of New York is not an affiliated person of BNY Hamilton
Distributors.
Each Fund pays administration fees that are accrued daily and payable
monthly at the rate of .10% of average daily net assets of such Fund.
DISTRIBUTOR
In addition to acting as Administrator, BNY Hamilton Distributors will be the
exclusive underwriter and distributor of shares of each Fund (the
'Distributor').
The Distributor will make a continuous offering of each Fund's shares and
will bear the costs and expenses of distributing to selected dealers and
prospective investors copies of any prospectuses, statements of additional
information and annual and interim reports of the Funds (after such items have
been prepared, printed and sent by the Funds at their expense to existing
shareholders) that are used in connection with the offering of shares, and the
costs and expenses of preparing, printing and distributing any other literature
used by the Distributor or furnished by it for use by selected dealers in
connection with the offering of each Fund's shares for sale to the public.
FUND AND OTHER
SHAREHOLDER SERVICES--GENERAL
CUSTODIAN AND FUND ACCOUNTING AGENT
The Bank of New York, 90 Washington Street, New York, New York 10286, serves as
each Fund's custodian. Each Fund has also entered into a Cash Management and
Related Services Agreement with The Bank of New York pursuant to which The Bank
of New York, as custodian, receives and disburses funds in connection with
purchases and redemptions of the Fund's shares.
The Bank of New York also serves as the fund accounting agent for each Fund
with responsibility for calculating the net asset value per share for the
Hamilton Premier class of each Fund thereof and for maintaining the books and
records of the Hamilton Premier class of each Fund.
TRANSFER AGENT
BISYS Fund Services, Inc. is the transfer agent for the Hamilton Premier class
of shares of each Fund. BISYS Fund Services, Inc. is a wholly-owned subsidiary
of The BISYS Group, Inc. ('BISYS'). BISYS owns BNY Hamilton Distributors, Inc.,
the Funds' Administrator and Distributor. The transfer agent maintains the
account records of shareholders of each Fund and administers the distribution of
any dividends or distributions declared by the Funds.
(12) PROSPECTUS
<PAGE>
SHAREHOLDER SERVICING PLAN
BNY Hamilton Funds, Inc. has adopted Shareholder Servicing Plans (the
'Plans') pursuant to which Hamilton Premier Shares of the Money Fund and the
Treasury Money Fund are sold to certain institutions ('Shareholder
Organizations') that enter into servicing agreements ('Shareholder Servicing
Agreements') with BNY Hamilton Funds, Inc. The Bank of New York and the
Administrator have each entered into Shareholder Servicing Agreements with
respect to Hamilton Premier Shares, and it is expected that other organizations,
including certain affiliates of The Bank of New York and the Administrator, may
enter into Shareholder Servicing Agreements in the future. The Shareholder
Servicing Agreements require the Shareholder Organizations to provide support
services to their customers ('Customers') who are beneficial owners of Hamilton
Premier Shares in return for payment by the Fund of .25% (on an annualized
basis) of the average daily net asset value of the Hamilton Premier Shares
beneficially owned by Customers of the Shareholder Organizations. Holders of
Hamilton Premier Shares will bear all fees payable to Shareholder Organizations
for their services with respect to such shares.
The services to be provided by each Shareholder Organization include the
following: aggregating and processing purchase and redemption requests from
Customers and placing net purchase and redemption orders with the Distributor;
providing Customers with a service that invests the assets of their other
investment accounts in Hamilton Premier Shares automatically, pursuant to
specific preauthorized instructions; processing dividend payments on behalf of
Customers; providing information periodically to Customers regarding their
position in Hamilton Premier Shares; arranging for bank wires; responding to
Customer inquiries regarding services performed by the Shareholder
Organizations; providing sub-accounting with respect to shares beneficially
owned by Customers or the information necessary for sub-accounting; forwarding
shareholder communications from the Funds to Customers; and other similar
services as agreed to with the Funds.
The Funds will accrue, as expenses, fees payable made pursuant to each Plan
daily. The Shareholder Servicing Agreements require each Shareholder
Organization to waive a portion of any payment such organization is entitled to
receive pursuant to either Plan to the extent necessary to assure that the Plan
payments required to be charged to the Fund's Hamilton Premier Shares on any day
do not exceed the income to be accrued to such shares on that day. BNY Hamilton
Funds, Inc. understands that Shareholder Organizations may charge fees to their
Customers who are the beneficial owners of Hamilton Premier Shares in connection
with their Customer accounts. These fees would be in addition to any amounts the
Funds may pay a Shareholder Organization under a Shareholder Servicing
Agreement. Under the terms of the Shareholder Servicing Agreements, Shareholder
Organizations are required to disclose the compensation payable to them by a
Fund and any other compensation payable by their Customers in connection with
the investment of their assets in a Fund. Customers of Shareholder Organizations
should read this Prospectus in conjunction with the terms governing their
accounts with their Shareholder Organizations.
PROSPECTUS (13)
<PAGE>
Conflict-of-interest restrictions may apply to an institution's receipt of
compensation paid by a Fund in connection with the investment of fiduciary funds
in Hamilton Premier Shares. Institutions, including banks regulated by the
Comptroller of the Currency, the Federal Reserve Board or the Federal Deposit
Insurance Corporation, and investment advisers and other money managers subject
to the jurisdiction of the Securities and Exchange Commission, the Department of
Labor or state securities commissions, are urged to consult their legal advisers
before investing fiduciary funds in Hamilton Premier Shares of either Fund.
Banks may act as Shareholder Organizations. The Glass-Steagall Act and
other applicable laws, among other things, prohibit banks from engaging in the
business of underwriting securities. If a bank were prohibited from acting as a
Shareholder Organization, its shareholder clients would be permitted by the
Funds to remain shareholders of a Fund and alternative means for continuing the
servicing of such shareholders would be sought. In such event, changes in the
operation of a Fund might occur and a shareholder serviced by such bank might no
longer be able to avail itself of automatic investment or other services then
being provided by the bank. It is not expected that shareholders would suffer
any adverse financial consequences as a result of any of these occurrences.
In connection with the sale of Hamilton Premier Shares, the Funds obtain
representations from Shareholder Organizations (including The Bank of New York
and the Administrator) that they are or will be licensed as dealers as required
by applicable law or will not engage in activities which would require them to
be so licensed.
FEE WAIVERS
Except as noted in this Prospectus and the Statement of Additional Information,
the Funds' service contractors bear all expenses in connection with the
performance of their services and each Fund (and each class thereof) bears the
expenses incurred in its operation. From time to time during the course of the
Funds' fiscal year, each of the Administrator and the Adviser may voluntarily
elect not to receive payment of fees under their respective agreements described
above and/or to assume certain expenses of a Fund (or class thereof), while
retaining the ability to be reimbursed by such Fund for such amount prior to the
end of the fiscal year. This will have the effect of increasing yield to
investors at the time such fees are not requested to be paid to, or amounts are
assumed by, the Administrator or the Adviser and decreasing yield when such fees
or amounts are reimbursed to the Administrator or the Adviser.
SHAREHOLDER
SERVICES
Hamilton Premier Shares of either Fund may be purchased by clients of The Bank
of New York and other financial institutions (which may include banks) and their
affiliates that have entered into Shareholder Servicing Agreements with BNY
Hamilton Funds, Inc., on behalf of the Funds. Investors should contact their
financial institution to determine if they are eligible to purchase Hamilton
Premier Shares and to receive instructions for such purchase.
(14) PROSPECTUS
<PAGE>
PURCHASES VIA PROCEDURES ESTABLISHED BY THE BANK OF NEW YORK
Hamilton Premier Shares may be purchased through procedures established by
The Bank of New York in connection with certain of its customer accounts. In
many instances, these procedures will include instructions under which a
customer's account is swept automatically on a daily basis, and amounts (federal
funds) in excess of a minimum balance agreed to by The Bank of New York and its
customer are invested in a Fund. The Funds expect that The Bank of New York will
transmit orders on behalf of its customers for the purchase of Fund shares
arising from this automatic investment program on the day after excess balances
are swept for the Money Fund, and on the same day excess balances are swept for
the Treasury Money Fund. This Prospectus should be read in conjunction with any
material provided by The Bank of New York regarding such procedures. Similar
arrangements may also be available from Shareholder Organizations other than The
Bank of New York.
REGULAR REDEMPTION
Investors should contact their Shareholder Organization for appropriate
instructions on redemption orders for Hamilton Premier Shares. While each Fund
seeks to maintain the net asset value per Hamilton Premier Share at $1.00, there
can be no assurance that it will be able to do so, and the proceeds paid upon
redemption may be more or less than the amount invested depending upon a share's
net asset value at the time of redemption.
PURCHASE
OF SHARES
Fund shares are sold at the net asset value per share next determined after
receipt of a purchase order by the transfer agent. The Funds do not impose any
fee for purchase orders placed directly with the transfer agent without the
assistance of a broker-dealer. Broker-dealers (other than the Distributor) and
others who process purchase orders on behalf of Customers may charge a fee for
their services.
Purchase orders for shares are accepted by a Fund only on a day on which
both the New York Stock Exchange and the custodian are open for business (a
'Business Day'). As used herein, a 'Business Day' is a day on which the New York
Stock Exchange is open for trading and any other day (other than a day on which
no shares of a Fund are tendered for redemption and no order to purchase shares
is received) during which there is sufficient trading in the Fund's portfolio
securities that the Fund's net asset value per share might be materially
affected.
Purchase orders received by the transfer agent before 4:30 p.m. Eastern
time on a Business Day for either Fund will be executed as of the times noted
for the respective Fund, if payment is received by the times noted for the
respective Fund. Orders received after the times noted for the respective Fund,
and orders for which payment has not been received by the times noted for the
respective Fund, will not be accepted. A Fund may in its discretion reject any
order for shares. Payment for orders which are not received or paid for in a
timely manner or
PROSPECTUS (15)
<PAGE>
are not accepted by a Fund will be returned after prompt notification to the
sending institution. On those days when the New York Stock Exchange or the
custodian closes early as a result of such day being a partial holiday or
otherwise, the right is reserved to advance the time on that day by which
purchase orders and redemption requests must be received.
Payment for shares may be made only in federal funds or other funds
immediately available to the transfer agent. Purchases made by check are not
permitted to be redeemed until payment of the purchase has been collected, which
may take up to ten business days after purchase. The Funds reserve the right to
suspend the sale of shares to the public at any time, in response to conditions
in the securities markets or otherwise.
Investors in Hamilton Premier Shares are automatically entitled to purchase
additional Fund shares by telephone unless they notify the transfer agent in
writing that they do not wish to use this telephone privilege. There is no
charge for the telephone purchase privilege.
The Distributor, from time to time, at its expense, will provide
compensation to dealers in connection with sales of shares of any other funds in
the BNY Hamilton Family of Funds. Such compensation will include non-cash
payments which may take the form of (1) gift certificates, (2) tickets for
entertainment events, (3) trips, including the provision of travel arrangements
and lodging at vacation resorts and (4) merchandise. Dealers may not use sales
of any Funds' shares to qualify for this compensation to the extent such sales
may be prohibited by laws of any state or any self-regulatory agency, such as
the National Association of Securities Dealers, Inc. None of the aforementioned
compensation is paid for by any series of BNY Hamilton Funds, Inc. or its
shareholders.
Federal regulations require that each investor provide a certified Taxpayer
Identification Number (social security number for individuals) upon opening or
reopening an account with a Fund. Investors should refer to the section entitled
'Taxes' for further information about this requirement.
In the interest of economy and convenience and because of its operating
procedures, the Funds will not issue certificates representing ownership of
shares. All shares purchased will be confirmed and credited to investors'
accounts on the books maintained by the Adviser or its agents for the relevant
Fund.
REDEMPTION
OF SHARES
Redemption orders are effected at the net asset value per share next determined
after receipt of the order by the transfer agent. Payment for redeemed shares
for which a redemption order is received by the transfer agent prior to 4:30
p.m. Eastern time for either Fund on a Business Day is normally made in federal
funds wired to the redeeming shareholder on the same Business Day. Payment for
redeemed shares for which a redemption order is received after the time stated
above on a Business Day is normally made in federal funds wired to the redeeming
shareholder on the next Business Day following redemption. In order to allow The
Bank of New York to most effectively manage each Fund, investors are urged to
initiate redemptions of
(16) PROSPECTUS
<PAGE>
shares as early in the day as possible and to notify the transfer agent at
least one day in advance of redemptions in excess of $5 million. The Funds
reserve the right to wire redemption proceeds up to seven days after receiving
the redemption order if, in the judgment of the Adviser, an earlier payment
could adversely affect a Fund. Investors in Hamilton Premier Shares are
automatically entitled to redeem shares, without charge, by telephone, unless
they notify the transfer agent in writing that they do not wish to use this
telephone privilege.
None of the Funds, the Distributor, the transfer agent or the Funds' other
service contractors will be responsible for any loss or expense for acting upon
telephone instructions that they believe to be genuine. In attempting to confirm
that telephone instructions are genuine, the Funds and their service contractors
will use such procedures as they consider reasonable as described in 'Redemption
of Shares' in the Statement of Additional Information. To the extent that the
Funds or their service contractors do not use reasonable procedures to form
their belief as to the genuineness of accountholders' instructions, it and/or
its service contractors may be responsible for such instructions as are
fraudulent or unauthorized.
Redemption orders submitted directly to the transfer agent without the
assistance of a broker-dealer or other person, and orders submitted by the
Distributor for its brokerage customers, are processed without charge.
Broker-dealers (other than the Distributor) and others who process redemption
orders on behalf of their customers may charge a fee for their services.
The Funds may suspend the right of redemption or postpone the date of
payment upon redemption (as well as suspend or postpone the recordation of the
transfer of its shares) for such periods as are permitted under the 1940 Act.
The Funds reserve the right to redeem Hamilton Premier Shares in any account at
their net asset value if the value of the account is less than $500,000 as a
result of redemptions. The shareholder having the account will first be notified
in writing that its account has a value of less than $500,000 and will be
allowed 60 days to make additional investments to bring the value of its account
to $500,000 before the redemption is processed by the Fund. In addition, the
Funds may redeem Hamilton Premier Shares under certain special circumstances
described in the Statement of Additional Information under 'Redemption of
Shares'.
Hamilton Premier Shares may be redeemed through procedures established by
The Bank of New York in connection with certain of its customer accounts. In
many instances, these procedures will include instructions under which Hamilton
Shares and Hamilton Premier Shares are redeemed automatically in amounts
necessary to maintain a specific previously agreed upon balance in the
customer's account at The Bank of New York. This Prospectus should be read in
conjunction with any material provided by The Bank of New York regarding such
procedures. Similar arrangements may also be available from Shareholder
Organizations other than The Bank of New York.
EXCHANGE
OF SHARES
An investor may exchange shares between the Funds described in this prospectus
and any other fund in the BNY Hamilton Family of Funds described in the relevant
prospectuses for the Equity Funds, the Taxable Fixed Income Funds or the
Tax-Exempt Fixed Income Funds.
PROSPECTUS (17)
<PAGE>
Shareholders of either Fund must request and obtain a current copy of the
relevant prospectus before exchanging their investment in the Money Fund or the
Treasury Money Fund for an initial investment in one of the other members of the
BNY Hamilton Family of Funds. Investors considering such an exchange of shares
are urged to read the relevant prospectus carefully prior to exchange.
For details regarding an exchange for Institutional Shares of any other BNY
Hamilton Fund, contact your Bank of New York representative for details.
An exchange may be made for Investor Shares of any other BNY Hamilton Fund,
so long as the shares to be exchanged have a value of at least $500, and the
shares to be purchased in the exchange may legally be sold in the state of the
investor's residence. If a shareholder is establishing a NEW account by
exchange, shares of the specific Fund being exchanged must have a value at least
equal to the minimum initial investment required by the specific Fund into which
the exchange is being made (currently $2,000 for Investor Shares for each of the
Equity Funds, the Taxable Fixed Income Funds and the Tax-Exempt Fixed Income
Funds). Shares will be exchanged on the basis of relative net asset value per
share.
An investment in the Money Fund or Treasury Money Fund automatically
entitles an investor to use the exchange privilege unless he or she indicates on
the Account Application or in a subsequent written notice to the transfer agent
that he or she does not wish to use this privilege. The relevant prospectuses
for the other portfolios of the BNY Hamilton Family of Funds into which an
exchange is being made may be obtained from the investor's Service Organization
or the Distributor. A shareholder may exchange shares by telephone by calling
the transfer agent at 1-800-952-6276. Telephone privileges will be suspended for
a period of ten days following a change of address. See 'Redemption of Shares'
in the Statement of Additional Information for a description of the Funds'
policy regarding responsibility for telephone instructions. An investor desiring
to use the exchange privilege should read the Statement of Additional
Information and consult his or her Service Organization or the Distributor for
further information applicable to use of the exchange privilege. The BNY
Hamilton Family of Funds reserves the right to reject any exchange request and
the exchange privilege may be modified or terminated at any time. At least 60
days' notice will be given to shareholders of any material modification or
termination except where notice is not required under regulations of the
Securities and Exchange Commission.
Exchanges are in effect redemptions from one member of the BNY Hamilton
Family of Funds and purchases of another member of the BNY Hamilton Family of
Funds and the usual purchase and redemption procedures and requirements are
applicable to exchanges. Also see 'Purchase of Shares' and 'Redemption of
Shares' in this prospectus and the other prospectuses.
DIVIDENDS AND
DISTRIBUTIONS
The net investment income for Hamilton Premier Shares of each Fund's shares will
be declared as dividends daily and paid monthly within five (5) Business Days
after the end of the month. Dividends and distributions will be payable to
shareholders of record at the time of declaration.
(18) PROSPECTUS
<PAGE>
The net investment income of Hamilton Premier Shares of each Fund for
each Business Day will be determined immediately prior to the determination
of net asset value. Net investment income for other days will be determined on
the prior Business Day. Shares of Hamilton Premier Shares of each Fund will
begin earning dividends on the Business Day their purchase is effective. See
'Purchase of Shares' and 'Redemption of Shares'. The Directors may, without
action by the shareholders, revise the dividend policy or postpone the payment
of a dividend by a Fund if it incurs or anticipates any large unexpected
expense, loss or fluctuation in net assets that in the Directors' opinion might
have a significant adverse effect on shareholders.
Dividends on shares of each Fund generally are determined in the same
manner regardless of class, except that Hamilton Premier Shares and Hamilton
Classic Shares (not included herein) bear the fees paid to their respective
Shareholder Organizations for those general services described under 'Fund and
Other Shareholder Services--General-- Shareholder Servicing Plan'. In addition,
Hamilton Classic Shares of the Money Fund bear 12b-1 fees, and each class of
shares bears certain other miscellaneous 'class specific expenses' (i.e.,
certain registration and transfer agency expenses).
If you elect to receive distributions in cash, and the checks (1) are
returned and marked as 'undeliverable' or (2) remain uncashed for six months,
your cash election will be changed automatically and your future dividend and
capital gains distributions will be reinvested in the respective Fund at the per
share net asset value determined as of the date of payment of the distribution.
In addition, any undeliverable checks or checks that remain uncashed for six
months will be canceled and will be reinvested in the respective Fund at the per
share net asset value determined as of the date of cancellation.
The Funds do not expect to realize long-term capital gains or losses.
However, should a Fund do so, any net realized gains will be distributed at
least annually.
NET ASSET
VALUE
Net asset value per share for the Hamilton Premier Shares of each Fund will be
determined by subtracting from the value of the relevant Fund's total assets
attributable to the Hamilton Premier Shares the amount of such Fund's
liabilities attributable to shares of that class, dividing the remainder by the
number of outstanding shares of that class and rounding to the nearest one cent.
Expenses, including the fees payable to the Adviser and the Administrator, are
accrued daily. Each Fund will value its portfolio securities using the amortized
cost method. This method attempts to maintain a constant net asset value per
share of $1.00. No assurances can be given that this goal will be attained. See
'Net Asset Value' in the Statement of Additional Information for more
information on valuation of portfolio securities of the Funds.
Each Fund computes the net asset value of the Hamilton Premier Shares once
daily on Monday through Friday, except that the net asset value need not be
computed on a day in which no orders to purchase or redeem Hamilton Premier
Shares have been received or on the holidays listed under 'Net Asset Value' in
the Statement of Additional Information. Each Fund will compute net asset value
of its respective classes at 4:30 P.M. Eastern time.
PROSPECTUS (19)
<PAGE>
ORGANIZATION
BNY Hamilton Funds, Inc. is an open-end management investment company organized
as a Maryland corporation on May 1, 1992. The Articles of Incorporation
currently permit BNY Hamilton Funds, Inc. to issue 20,000,000,000 shares of
common stock, par value $.001 per share, which have been allocated as follows:
<TABLE>
<CAPTION>
NUMBER OF
NAME OF FUND AND CLASSES THEREOF SHARES AUTHORIZED
<S> <C>
- -----------------------------------------------------------------------------------
BNY Hamilton Money Fund--Hamilton Premier Shares............... 3,000,000,000
BNY Hamilton Treasury Money Fund--Hamilton Premier Shares...... 2,000,000,000
</TABLE>
The Directors may increase the number of shares each Fund is authorized to
issue without the approval of shareholders. The Directors also have the power to
designate one or more series or classes of shares of common stock and to
classify and reclassify any unissued shares with respect to such series or
classes.
Shareholders of each series of BNY Hamilton Funds, Inc. are entitled to one
vote for each share and to the appropriate fractional vote for each fractional
share. There is no cumulative voting and the Fund's shares have no preemptive or
conversion rights. All shareholders will vote together as a single class on
matters affecting the relevant Fund generally, including matters relating to the
relevant Fund's investment advisory agreement, investment objective and
fundamental investment restrictions. Shareholders of a particular class will
vote separately on any matters relating only to that class. For example, to the
extent shareholder votes are necessary, holders of Hamilton Premier Shares of
either Fund will vote separately on matters pertaining to their respective
shareholder servicing arrangements.
Shares offered hereby must be fully-paid upon issuance and thereafter will
be non-assessable by BNY Hamilton Funds, Inc. and the particular Fund to which
they belong. The Funds do not intend to hold meetings of shareholders. The
Directors may call meetings of shareholders for action by shareholder vote as
may be required by the 1940 Act or permitted by the Articles of Incorporation or
Bylaws of BNY Hamilton Funds, Inc.
BNY Hamilton Funds, Inc., if requested to do so by the holders of at least
10% of the shares of all series aggregated as a class, will call a meeting of
shareholders for the purpose of voting upon the removal of a director or
directors and will assist in communications with other shareholders as required
by Section 16(c) of the 1940 Act. For further organization information,
including certain shareholder rights, see 'Description of Shares' in the
Statement of Additional Information.
TAXES
The following discussion of federal tax consequences is based on the United
States tax laws in effect on the date of this Prospectus. These laws and
regulations are subject to change by legislative, judicial or administrative
action. Investors are urged to consult their own tax advisors with respect to
specific questions as to federal taxes and with respect to the applicability of
state, local or foreign taxes. See 'Taxes' in the Statement of Additional
Information. Annual
(20) PROSPECTUS
<PAGE>
statements as to the federal tax status of distributions will be mailed to
shareholders shortly after the end of the taxable year.
Each Fund intends to qualify as a regulated investment company under
Subchapter M of the Tax Code. As a regulated investment company, each Fund will
not be subject to federal income taxes on the net investment income and capital
gains distributed to shareholders, provided that it distributes annually at
least 90% of its net investment income and realized net short-term capital gains
in excess of net long-term capital losses.
Distributions of net investment income and realized net short-term capital
gains in excess of net long-term capital losses will be taxable to shareholders
of a Fund as ordinary income, whether such distributions are taken in cash or
reinvested in additional shares. Such distributions will not be eligible for the
dividends-received deduction. Individual shareholders will be subject to federal
income tax on distributions of net long-term capital gains at a maximum rate of
28% if designated as derived from a Fund's capital gains from property held for
more than one year and at a maximum rate of 20% if designated as derived from
property held for more than eighteen months.
Distributions of net long-term capital gains in excess of net short-term
capital losses, if any, will be taxable to shareholders of a Fund as long-term
capital gains regardless of how long the shareholders have held their shares and
regardless of whether taken in cash or reinvested in additional shares.
Long-term capital gains distributions will not be eligible for the dividends-
received deduction.
UNLESS A SHAREHOLDER INCLUDES ITS TAXPAYER IDENTIFICATION NUMBER (SOCIAL
SECURITY NUMBER FOR INDIVIDUALS) ON THE ACCOUNT APPLICATION AND CERTIFIES THAT
IT IS NOT SUBJECT TO BACKUP WITHHOLDING, A FUND MAY BE REQUIRED TO WITHHOLD AND
REMIT TO THE U.S. TREASURY 31% OF TAXABLE DISTRIBUTIONS AND OTHER REPORTABLE
PAYMENTS TO THE SHAREHOLDER. SHAREHOLDERS SHOULD BE AWARE THAT, UNDER
REGULATIONS PROMULGATED BY THE INTERNAL REVENUE SERVICE, A FUND MAY BE FINED UP
TO $50 ANNUALLY FOR EACH ACCOUNT FOR WHICH A CERTIFIED TAXPAYER IDENTIFICATION
NUMBER IS NOT PROVIDED. IN THE EVENT THAT SUCH A FINE IS IMPOSED WITH RESPECT TO
ANY UNCERTIFIED ACCOUNT IN ANY YEAR, A CORRESPONDING CHARGE MAY BE MADE AGAINST
THAT ACCOUNT.
ADDITIONAL
INFORMATION
The Funds will send to their shareholders annual and semi-annual reports. The
financial statements appearing in the annual reports will be audited by
independent auditors. Shareholders will also receive confirmations of each
purchase and redemption and monthly statements, reflecting all account activity,
including dividends reinvested in additional shares or credited as cash. Written
inquiries should be addressed to the specific Fund as follows:
BNY Hamilton Funds
P. O. Box 163310
Columbus, OH 43216-3310
PROSPECTUS (21)
<PAGE>
The Funds may make historical performance information available and may
advertise yield and effective yield as those terms are defined in the Statement
of Additional Information under Performance Data. The yield for the Hamilton
Premier Shares of each Fund may be compared to the yield of other mutual funds
with similar investment objectives and services and to other relevant indices or
to rankings prepared by independent services or other financial or industry
publications that monitor the performance of mutual funds. For example, the
yield for the Hamilton Premier Shares of each Fund may be compared to Money Fund
Report, a service of IBC Financial Data, Inc. Yield data as reported in national
financial publications, including but not limited to Money, Forbes, Barrons, The
Wall Street Journal and The New York Times, or in publications of a local or
regional nature, may also be used in comparing each Fund's yield. All
performance figures will be based on historical earnings and are not intended to
indicate future performance. Performance information may be obtained by calling
the Distributor at (1-800-4BNY-FND).
22 PROSPECTUS
<PAGE>
[This page intentionally left blank]
<PAGE>
BNY HAMILTON MONEY FUND--
HAMILTON CLASSIC SHARES
125 West 55th Street
New York, New York 10019
For information call 1-800-426-9363 (1-800-4BNY-FND)
BNY Hamilton Funds, Inc. is a family of no-load mutual funds for which there are
no sales charges, exchange fees or redemption fees. This Prospectus describes
BNY Hamilton Money Fund, offered by the BNY Hamilton Family of Funds.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------
FUND OBJECTIVE FOR INVESTORS SEEKING
- --------------------------------------------------------------------------------------
<S> <C> <C>
BNY HAMILTON MONEY FUND To earn as high a level of Daily dividends, liquidity,
current income as is and relatively low risk
consistent with preservation
of capital and maintenance
of liquidity by investing in
high quality money market
instruments
- --------------------------------------------------------------------------------------
</TABLE>
INVESTMENTS IN BNY HAMILTON MONEY FUND ARE NOT BANK DEPOSITS OR OBLIGATIONS OF
OR GUARANTEED OR INSURED BY THE BANK OF NEW YORK, AND THE SHARES IN BNY HAMILTON
MONEY FUND ARE NEITHER INSURED NOR GUARANTEED BY THE UNITED STATES GOVERNMENT,
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY
OTHER GOVERNMENTAL AGENCY. ALTHOUGH BNY HAMILTON MONEY FUND SEEKS TO MAINTAIN A
STABLE NET ASSET VALUE OF $1.00 PER SHARE, THERE CAN BE NO ASSURANCE THAT THE
FUND WILL BE ABLE TO DO SO.
This Prospectus sets forth concisely the information that a prospective investor
should know about the Fund before investing and should be retained for future
reference. Additional information about the Fund or other funds within the BNY
Hamilton Family of Funds has been filed with the Securities and Exchange
Commission in the Statement of Additional Information for BNY Hamilton Funds,
Inc., dated April 30, 1998. This information is incorporated by reference and is
available without charge upon request from the Fund's distributor, BNY Hamilton
Distributors, Inc., 125 West 55th Street, New York, New York 10019, Attention:
BNY Hamilton Funds, Inc. (1-800-4BNY-FND).
- --------------------------------------------------------------------------------
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 date of this Prospectus is April 30, 1998
5/98 BNY-0089
PROSPECTUS
<PAGE>
[This page intentionally left blank]
<PAGE>
SUMMARY OF CLASSES AND SERVICES AVAILABLE
FOR BNY HAMILTON MONEY FUND
<TABLE>
<CAPTION>
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INVESTMENT FOR INVESTORS SEEKING (1) SERVICES PROVIDED
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<S> <C> <C>
HAMILTON CLASSIC SHARES Daily dividends and liquidity * Wire order processing
(INDIVIDUAL AND INSTITUTIONAL as an alternative investment * Detailed statements sent to
INVESTORS) you directly each month
* Confirmation statements
mailed to you after each
transaction
* Automatic Investment Program
* Direct Deposit Program (for
individuals receiving income
from the federal government,
and for employees and
retirees of The Bank of New
York and its affiliates)
* Automatic Withdrawal Program
* Check Redemption
* Individual Retirement Account
('IRAs')
</TABLE>
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(1) Investors are cautioned that investments in BNY Hamilton Money Fund offered
hereby are not FDIC insured.
PROSPECTUS
<PAGE>
TABLE
OF
CONTENTS
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<TABLE>
<S> <C>
Fee Table 1
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Financial Highlights 3
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Investment Objectives and Policies 3
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Description of Securities 4
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Additional Investment Information and Risk Considerations 6
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Investment Restrictions 8
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Management of the Fund 9
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Fund and Other Shareholder Services--General 11
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Shareholder Services 14
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Purchase of Shares 18
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Redemption of Shares 19
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Exchange of Shares 20
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Dividends and Distributions 21
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Net Asset Value 21
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Organization 22
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Taxes 22
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Additional Information 23
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</TABLE>
PROSPECTUS
<PAGE>
FEE
TABLE
The following table illustrates that investors in the BNY Hamilton Money
Fund--Hamilton Classic Shares will incur no shareholder transaction expenses;
their investments will be subject only to the annual operating expenses set
forth below.
<TABLE>
<CAPTION>
BNY HAMILTON MONEY FUND
HAMILTON CLASSIC SHARES
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<S> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases...................... None
Sales Load Imposed on Reinvested Dividends........... None
Deferred Sales Load.................................. None
Redemption Fees...................................... None
Exchange Fees........................................ None
ANNUAL FUND OPERATING EXPENSES:
(AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS)
Management Fees...................................... .20%
12b-1 Fees........................................... .25%
Shareholder Servicing Fees........................... .25%
Other Expenses....................................... .18%
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Total Fund Operating Expenses........................ .88%
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EXAMPLE
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.
</TABLE>
<TABLE>
<CAPTION>
BNY HAMILTON MONEY FUND
HAMILTON CLASSIC SHARES
------------------------
<S> <C>
1 year................................................. $ 9
3 years................................................ $ 28
5 years................................................ $ 49
10 years............................................... $109
</TABLE>
PROSPECTUS (1)
<PAGE>
This table is designed to assist investors in understanding the various
direct and indirect costs that an investor would bear. Long-term shareholders of
BNY Hamilton Money Fund Classic Shares may pay more than the economic equivalent
of the maximum front-end sales load imposed on purchases permitted by the
National Association of Securities Dealers, Inc. Management reserves the right
to implement or discontinue expense limitations at any time. See 'Fund and Other
Shareholder Services--General--Fee Waivers'.
For a description of contractual fee arrangements or the fees and expenses
included in Other Expenses, see 'Management of the Fund' and 'Fund and Other
Shareholder Services-- General'. In connection with the example, please note
that $1,000 is less than the minimum initial investment requirement and that
there are no redemption or exchange fees of any kind. See 'Purchase of Shares'
and 'Redemption of Shares'.
THE EXAMPLE IS HYPOTHETICAL; IT IS INCLUDED SOLELY FOR ILLUSTRATIVE
PURPOSES. IT SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
PERFORMANCE; ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. EXPENSES PAID
AS SHOWN ABOVE REFLECT ESTIMATES MADE BY THE FUNDS AS OF THE DATE OF THIS
PROSPECTUS.
(2) PROSPECTUS
<PAGE>
FINANCIAL
HIGHLIGHTS
The following selected financial data of Hamilton Classic Shares of BNY Hamilton
Money Fund was audited by KPMG Peat Marwick LLP, independent accountants for the
year ended December 31, 1997, and by Deloitte & Touche LLP, independent
accountants, for all other periods presented, whose reports thereon appear in
the Fund's annual reports. This information should be read in conjunction with
the financial statements and related notes that also appear in the Fund's Annual
Report dated December 31, 1997 which is incorporated by reference into the
Statement of Additional Information.
<TABLE>
<CAPTION>
HAMILTON CLASSIC SHARES
----------------------------------------
FOR THE PERIOD
DECEMBER 4,
YEAR ENDED DECEMBER 1995*
31, THROUGH
-------------------- DECEMBER 31,
1997 1996 1995
-------------------- --------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period....... $ 1.00 $ 1.00 $ 1.00
----------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income........................ 0.047 0.046 0.004
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DIVIDENDS
Dividends from net investment income......... (0.047) (0.046) (0.004)
----------------------------------------
Net asset value at end of period............. $ 1.00 $ 1.00 $ 1.00
----------------------------------------
----------------------------------------
TOTAL RETURN:................................ 4.80% 4.73% 0.40%**
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000's
omitted)................................... $16,725 $13,478 $ 3,098
Ratio to average net assets of:
Expenses................................... 0.88% 0.82% 0.76%***
Net investment income...................... 4.71% 4.67% 5.18%***
</TABLE>
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* Commencement of investment operations.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Money Fund is
contained in the Fund's annual report to shareholders, which may be obtained
from the distributor, BNY Hamilton Distributors, Inc., upon request and without
charge.
INVESTMENT OBJECTIVES
AND POLICIES
The investment objective of BNY Hamilton Money Fund (the 'Fund') is described
below, together with the policies the Fund will employ in its efforts to achieve
its objective. There can be no assurance that the Fund will attain its
investment objective.
INTRODUCTION
The Fund is an open-end management investment company (commonly known as mutual
funds) registered under the Investment Company Act of 1940 (the '1940 Act'). The
Fund is considered a separate pool of assets with its own distinctive investment
objective and policies, as described below.
PROSPECTUS (3)
<PAGE>
The Fund's investment objective is to earn as high a level of current income as
is consistent with preservation of capital and maintenance of liquidity by
investing in high quality money market instruments.
The Fund will maintain a dollar-weighted average portfolio maturity of not
more than 90 days and will only purchase securities having a remaining maturity
of 397 days or less.
Because the Fund only invests in high quality money market securities, the
Fund may not be able to achieve as high a level of current income under all
market conditions as would be possible if it were permitted to invest in lower
quality and longer term securities, which generally are less liquid, have
greater market risk and are subject to more fluctuation of market value.
DESCRIPTION
OF SECURITIES
UNITED STATES GOVERNMENT OBLIGATIONS
The Fund may invest in obligations issued or guaranteed by the United States
Government or by its agencies or instrumentalities. Obligations issued or
guaranteed by federal agencies or instrumentalities may or may not be backed by
the 'full faith and credit' of the United States and in either case the Fund
must look principally to the agency issuing or guaranteeing the obligations for
legitimate repayment. Securities that are backed by the full faith and credit of
the United States include Treasury Bills, Treasury Bonds and obligations of the
Government National Mortgage Association, the Farmers Home Administration and
the Export-Import Bank. Securities in which the Fund may invest that are not
backed by the full faith and credit of the United States include, but are not
limited to, obligations of the Federal National Mortgage Association, the
Tennessee Valley Authority, the Federal Farm Credit System and Federal Home Loan
Banks. The Fund may also invest in component parts of United States Treasury
notes or bonds, namely either the corpus (principal) of such Treasury
obligations or one of the interest payments scheduled to be paid on such
obligations. Certain arrangements by which such components are offered have been
created by private sponsors, such as investment banks and securities dealers,
and are not United States Government securities.
BANK OBLIGATIONS
As is consistent with its credit quality parameters, the Fund may invest in high
quality negotiable certificates of deposit, time deposits and bankers'
acceptances of domestic and foreign issuers. Investments in such obligations
will be limited, at the time of investment, to the obligations of domestic banks
that are subject to regulatory supervision by the United States Government or
state governments, and the obligations of foreign banks with branches or
agencies in the United States.
Investments in foreign banks and foreign branches of United States banks
involve certain risks not generally associated with investments in domestic
banks. While domestic banks are required to maintain certain reserves and are
subject to other regulations, such requirements and regulations may not apply to
foreign branches. Investments in foreign banks and branches may also be subject
to other risks, including future political and economic developments, the
(4) PROSPECTUS
<PAGE>
seizure or nationalization of foreign deposits and the establishment of
exchange controls or other restrictions. For more information about foreign
investments, see 'Additional Investment Information and Risk
Considerations--Foreign Investment Risk'.
The Fund may also invest in obligations of international banking
institutions designated or supported by national governments to promote economic
reconstruction, development or trade between nations (e.g., the World Bank, the
Inter-American Development Bank and the European Investment Bank). These
obligations may be supported by appropriated but unpaid commitments of their
member countries, and there is no assurance that these commitments will be
undertaken or met in the future.
COMMERCIAL PAPER
The Fund may invest in high quality commercial paper issued by domestic and
foreign issuers. The Fund may also invest in the commercial paper of foreign
issuers provided it is United States dollar-denominated. For more information
about foreign investments, see 'Additional Investment Information and Risk
Considerations--Foreign Investment Risk'.
REPURCHASE AGREEMENTS
The Fund may invest in securities generally referred to as repurchase
agreements, provided the agreements are entered into with dealers meeting credit
criteria established by the Board of Directors of BNY Hamilton Funds, Inc. (the
'Directors'), monitored by the Fund's adviser and fully collateralized by (i)
United States Government or Agency obligations or (ii) other securities rated in
the highest rating category by one or more Nationally Recognized Statistical
Rating Organizations ('NRSROs') at the time of purchase. See 'Quality
Information' for a further description of certain NRSROs. Also see 'Additional
Investment Information and Risk Considerations--Repurchase Agreements' for a
discussion of further risks associated with repurchase agreements.
CORPORATE BONDS AND NOTES
The Fund may invest in high quality corporate bonds and notes issued by United
States corporations. The Fund may also invest in the bonds of foreign issuers
provided the bonds are United States dollar-denominated and are not subject to
foreign withholding tax.
FOREIGN GOVERNMENT OBLIGATIONS
The Fund may invest in short-term obligations of foreign sovereign governments
or of their agencies, instrumentalities, authorities or political subdivisions,
provided the short-term obligations are United States dollar-denominated. For
the purpose of applying the Fund's fundamental concentration policy, the Fund
will consider each sovereign government, together with all of its agencies,
instrumentalities, authorities and political subdivisions, as being engaged in
the same industry. See 'Investment Restrictions'.
PROSPECTUS (5)
<PAGE>
QUALITY INFORMATION
The Fund will limit its investments to those securities that, in accordance with
guidelines adopted by the Directors, present minimal credit risks and are 'First
Tier Securities' (as defined in Rule 2a-7 promulgated under the 1940 Act) at the
time of acquisition by the Fund. The term 'First Tier Securities' generally
includes securities rated by the requisite NRSROs in the highest short-term
rating categories, securities of issuers that have received such ratings with
respect to other comparable short-term debt securities and comparable unrated
securities. Requisite NRSROs means (a) any two NRSROs that have issued a rating
with respect to a security or class of debt obligations of an issuer, or (b) one
NRSRO, if only one NRSRO has issued such a rating at the time that the Fund
acquires the security. Currently, there are six NRSROs: Standard & Poor's
Ratings Group, Moody's Investors Service, Inc., Fitch Investors Services, L.P.,
Duff and Phelps/MCM, IBCA Limited and its affiliate, IBCA, Inc. and Thomson
Bankwatch. A discussion of ratings categories is contained in the Appendix to
the Statement of Additional Information. The Fund generally may not invest more
than 5% of its total assets in the securities of any one issuer, except for
United States government securities.
ADDITIONAL INVESTMENT
INFORMATION AND
RISK CONSIDERATIONS
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
The Fund may purchase securities on a when-issued or delayed delivery basis.
Delivery of and payment for these securities may take as long as a month or more
after the date of the purchase commitment. The value of these securities is
subject to market fluctuation during this period and no interest or income
accrues to the Fund until settlement. The Fund will maintain with its custodian
a separate account with a segregated portfolio of liquid assets consisting of
cash, United States government securities or other liquid, high-grade debt
securities in an amount at least equal to these commitments. When entering into
a when-issued or delayed delivery transaction, the Fund will rely on the other
party to consummate the transaction; if the other party fails to do so, the Fund
may be disadvantaged. It is the current policy of the Fund not to enter into
when-issued commitments exceeding in the aggregate 15% of the market value of
the Fund's total assets less liabilities other than the obligations created by
these commitments.
(6) PROSPECTUS
<PAGE>
REPURCHASE AGREEMENTS
The Fund may enter into repurchase agreements with brokers, dealers or banks
that meet the credit guidelines established by the Directors. In a repurchase
agreement, the Fund buys a security from a seller that has agreed to repurchase
it on a mutually agreed upon date and at a price reflecting the interest rate
effective for the term of the agreement. The term of these agreements is usually
from overnight to one week. A repurchase agreement may be viewed as a fully
collateralized loan of money by the Fund to the seller. The Fund always
receives, as collateral, securities with a market value at least equal to the
purchase price plus accrued interest and this value is maintained during the
term of the agreement. If the seller defaults and the collateral value declines,
the Fund might incur a loss. If bankruptcy proceedings are commenced with
respect to the seller, the Fund's realization upon the collateral may be delayed
or limited. Investments in certain repurchase agreements and certain other
investments that may be considered illiquid are limited as set forth under
'Investment Restrictions' below.
REVERSE REPURCHASE AGREEMENTS
The Fund is permitted to enter into reverse repurchase agreements. In a reverse
repurchase agreement, the Fund sells a security and agrees to repurchase it on a
mutually agreed upon date and at a price reflecting the interest rate effective
for the term of the agreement. A reverse repurchase agreement may also be viewed
as the borrowing of money by the Fund. The Fund will not invest the proceeds of
a reverse repurchase agreement for a period which exceeds the duration of the
reverse repurchase agreement. The Fund may not enter into reverse repurchase
agreements exceeding in the aggregate one-third of the market value of its total
assets, less liabilities other than the obligations created by reverse
repurchase agreements. The Fund will establish and maintain with its custodian a
separate account with a segregated portfolio of liquid assets consisting of
cash, United States Government securities or other liquid, high-grade debt
securities in an amount at least equal to its purchase obligations under its
reverse repurchase agreements.
If interest rates rise during the term of a reverse repurchase agreement,
entering into the reverse repurchase agreement may have a negative impact on the
Fund's ability to maintain a net asset value of $1.00 per share. Reverse
repurchase agreements also involve the risk that the market value of the
securities retained by the Fund may decline below the price of the securities
the Fund has sold but is obligated to repurchase under the agreement. In the
event the buyer of securities under a reverse repurchase agreement files for
bankruptcy or becomes insolvent, the Fund's use of proceeds from the agreement
may be restricted pending a determination by the other party or its trustee or
receiver whether to enforce the Fund's obligation to repurchase the securities.
PROSPECTUS (7)
<PAGE>
FOREIGN INVESTMENT RISK
The Fund may invest in certain foreign securities, as described in the
paragraphs above. Investments in obligations of foreign issuers, foreign
sovereign governments, and in foreign branches of domestic banks involve
somewhat different investment risks from those affecting obligations of United
States domestic issuers. There may be limited publicly available information
with respect to foreign issuers, and foreign issuers are not generally subject
to uniform accounting, auditing and financial standards and requirements
comparable to those applicable to domestic institutions. There may also be less
government supervision than in the United States. Foreign markets have
substantially less trading volume than domestic markets and securities of some
foreign issuers are less liquid and more volatile than securities of comparable
domestic issuers. Brokerage commissions and other transaction costs in foreign
markets are generally higher than in the United States. Interest paid by foreign
issuers may be subject to withholding and other foreign taxes that may decrease
the net return on foreign investments as compared to investments the Fund may
make in securities of domestic institutions. Additional risks include future
political and economic developments, the possibility that a foreign jurisdiction
may impose or change withholding taxes on income payable with respect to foreign
securities, the possible seizure, nationalization, or expropriation of one or
more foreign issuers or foreign deposits and the possible adoption of foreign
governmental restrictions such as exchange controls.
VARIABLE AND FLOATING RATE INSTRUMENTS
While the Fund will generally only invest in securities that mature within 397
days of the date of purchase, it may invest in variable and floating rate
instruments that have stated final maturities in excess of 397 days if such
instruments meet and comply with conditions established by the Securities and
Exchange Commission.
INVESTMENT
RESTRICTIONS
As a diversified series of a registered investment company, 75% of the assets of
the Fund is subject to the following limitations: (a) the Fund may not invest
more than 5% of its total assets in the securities of any one issuer, except
obligations of the United States Government and its agencies and
instrumentalities, and (b) the Fund may not own more than 10% of the outstanding
voting securities of any one issuer. The Fund is subject to additional
requirements governing money market funds that use the amortized cost method to
value assets. These requirements generally prohibit the Fund from investing more
than 5% of its total assets in the securities of any single issuer, except
obligations of the United States Government and its agencies and
instrumentalities.
(8) PROSPECTUS
<PAGE>
The Fund also operates under certain investment restrictions that,
together with its investment objective, are deemed fundamental policies of
the Fund--i.e., they may only be changed with the approval of the holders of a
majority of the Fund's outstanding shares. The Fund may not: (i) acquire any
illiquid securities if, as a result, more than 10% of the market value of its
net assets would be in investments that are illiquid; (ii) enter into reverse
repurchase agreements exceeding one-third of the market value of its total
assets, less liabilities other than obligations created by reverse repurchase
agreements; (iii) borrow money, except from banks for extraordinary or emergency
purposes, and then only in amounts up to 20% of the value of the Fund's total
assets (taken at cost at time of borrowing) and except in connection with
permitted reverse repurchase agreements; or mortgage, pledge, or hypothecate any
assets except in connection with any borrowing in amounts up to 20% of the value
of the Fund's net assets at the time of borrowing; (iv) purchase securities
while borrowing (including reverse repurchase agreements) exceeds 5% of its
total assets; or (v) invest more than 25% of its assets in any one industry,
except that the Fund may invest more than 25% of its assets in securities and
other instrumentalities issued by banks and bank holding companies organized
under the laws of the United States or any state thereunder.
In addition, the Directors have adopted as an operating policy, which may
not be changed without approval of a majority of the outstanding shares, that
the Fund may not: (i) purchase any short-term debt securities unless such
securities are rated as described in 'Description of Securities--Quality
Information' or, if not so rated, securities determined to be of comparable
quality in accordance with procedures established by the Directors; (ii)
purchase securities that cannot be offered for public sale in the United States
without first being registered under the Securities Act of 1933, as amended,
including but not limited to securities that can be purchased pursuant to Rule
144A of said Act, and (iii) lend its securities.
For a more detailed discussion of the above investment restrictions, see
'Investment Restrictions and Additional Information' in the Statement of
Additional Information.
MANAGEMENT
OF THE FUND
DIRECTORS
Pursuant to the Articles of Incorporation and Bylaws of BNY Hamilton Funds,
Inc., the Directors decide upon matters of general policy and review the actions
of the investment adviser, administrator, distributor and other service
providers to the Fund. The Statement of Additional Information contains the name
and general business experience of each Director.
PROSPECTUS (9)
<PAGE>
INVESTMENT ADVISER
The Bank of New York serves as the Fund's investment adviser (the 'Adviser').
The Adviser, which has its principal offices at 48 Wall Street, New York, New
York 10286, is New York's first bank, founded by Alexander Hamilton in 1784, and
is one of the largest commercial banks in the United States, having over $60
billion in assets at December 31, 1997. It is the leading retail bank in the
greater New York suburban area, having 363 branches at December 31, 1997. As of
December 31, 1997, the Adviser provided administrative or advisory services to
approximately $42 billion in assets.
The Adviser will manage the investments of the Fund and will be responsible
for all purchases and sales of the Fund's portfolio securities. The Adviser's
fee accrues daily and is payable monthly at the annual rate of .10% of the
Fund's average daily net assets.
ADMINISTRATOR
BNY Hamilton Distributors, Inc. ('BNY Hamilton Distributors') serves as
administrator (the 'Administrator') to, and will assist generally in supervising
the operations of, the Fund. BNY Hamilton Distributors is a Delaware corporation
organized to administer and distribute mutual funds; its offices are located at
3435 Stelzer Road, Columbus, Ohio 43219-3035.
The Administration Agreement requires the Administrator to provide
facilities, equipment and personnel to carry out administrative services for the
Fund, including, among other things, providing the services of persons who may
be appointed as officers and directors of BNY Hamilton Funds, Inc., overseeing
the performance of the transfer agent (as described in 'Fund and Other
Shareholder Services--General--Transfer Agent'), supervising purchase and
redemption orders (made via telephone, mail and direct deposit), and monitoring
the Distributor's compliance with the rules and regulations of the National
Association of Securities Dealers and federal and state securities laws (also
see 'Distributor' below). The Administrator is responsible for coordinating and
overseeing compliance by the Directors with Maryland corporate procedural
requirements (as the Fund is series of a Maryland corporation; see
'Organization'). The Administrator also assists in updating and printing the
Fund's prospectus and statement of additional information, administering
shareholder meetings, producing proxy statements and annual and semi-annual
reports, monitoring the Adviser's compliance with the stated investment
objectives and restrictions of the Fund and monitoring the custodian, fund
accounting, transfer agency, administration, distribution, advisory and legal
services that are provided to the Fund.
The Administration Agreement permits the Administrator to delegate certain
of its responsibilities to other service providers. Pursuant to this authority,
The Bank of New York provides certain administrative functions for the
Administrator. The Bank of New York is not an affiliated person of BNY Hamilton
Distributors.
The Fund pays administration fees that are accrued daily and payable
monthly at the rate of .10% of its average daily net assets.
(10) PROSPECTUS
<PAGE>
DISTRIBUTOR
In addition to acting as Administrator, BNY Hamilton Distributors will be the
exclusive underwriter and distributor of shares of the Fund (the
'Distributor').
The Distributor will make a continuous offering of the Fund's shares and
will bear the costs and expenses of distributing to selected dealers and
prospective investors copies of any prospectuses, statements of additional
information and annual and interim reports of the Fund (after such items have
been prepared, printed and sent by the Fund at its expense to existing
shareholders) that are used in connection with the offering of shares, and the
costs and expenses of preparing, printing and distributing any other literature
used by the Distributor or furnished by it for use by selected dealers in
connection with the offering of the Fund's shares for sale to the public.
FUND AND OTHER
SHAREHOLDER SERVICES--GENERAL
CUSTODIAN AND FUND ACCOUNTING AGENT
The Bank of New York, 90 Washington Street, New York, New York 10286, serves as
the Fund's custodian. The Fund has also entered into a Cash Management and
Related Services Agreement with The Bank of New York pursuant to which The Bank
of New York, as custodian, receives and disburses funds in connection with
purchases and redemptions of the Fund's shares.
The Bank of New York also serves as the fund accounting agent for the Fund
with responsibility for calculating the net asset value per share and for
maintaining the books and records of the Fund.
TRANSFER AGENT
BISYS Fund Services, Inc. is the transfer agent for the Fund. BISYS Fund
Services, Inc. is a wholly-owned subsidiary of The BISYS Group, Inc. ('BISYS').
BISYS owns BNY Hamilton Distributors, Inc., the Funds' Administrator and
Distributor. The transfer agent maintains the account records of shareholders of
the Fund and administers the distribution of any dividends or distributions
declared by the Fund.
DISTRIBUTION PLAN
The Directors have adopted a distribution plan ('12b-1 Plan') with respect to
Hamilton Classic Shares of the Fund, which will permit of the Fund to pay the
Distributor up to .25% per annum of the average daily net assets of such class.
These expenses include, but are not limited to, fees paid to broker-dealers,
telemarketing expenses, advertising costs, printing costs, and the cost of
distributing materials borne by the Distributor in connection with sales or
selling efforts on behalf of the above-noted shares.
PROSPECTUS (11)
<PAGE>
The Hamilton Classic Shares of the Fund also bears the costs associated with
implementing and operating its 12b-1 Plan (such as costs of printing and mailing
service agreements). The items for which payments may be made under the 12b-1
Plan may constitute expenses of distributing the above-noted shares as the
Securities and Exchange Commission construes such term under Rule 12b-1 of the
1940 Act.
If, in any month, expenses reimbursable under the 12b-1 Plan exceeds .25%
per annum of average daily net assets, they will be carried forward from month
to month to the extent they remain unpaid. All or a part of any such amount
carried forward will be paid at such time, if ever, as the Directors determine.
The Hamilton Classic Shares of the Fund will not be charged any interest,
carrying or other finance charges on any distribution or other expense incurred
and not paid, nor will any unreimbursed expense be carried forward past the
fiscal year in which it is incurred. As of December 31, 1997, there were no
unreimbursed expenses associated with the 12b-1 Plan.
SHAREHOLDER SERVICING PLAN
BNY Hamilton Funds, Inc. has adopted a Shareholder Servicing Plan (the 'Plan')
pursuant to which Hamilton Classic Shares of the Fund are sold to certain
institutions ('Shareholder Organizations') that enter into servicing agreements
('Shareholder Servicing Agreements') with BNY Hamilton Funds, Inc. The Bank of
New York and the Administrator have each entered into Shareholder Servicing
Agreements with respect to Hamilton Classic Shares of the Fund, and it is
expected that other organizations, including certain affiliates of The Bank of
New York and the Administrator, may enter into Shareholder Servicing Agreements
in the future. The Shareholder Servicing Agreements require the Shareholder
Organizations to provide support services to their customers ('Customers') who
are beneficial owners of Hamilton Classic Shares in return for payment by the
Fund of .25% (on an annualized basis) of the average daily net asset value of
the Hamilton Classic Shares beneficially owned by Customers of the Shareholder
Organizations. Holders of Hamilton Classic Shares will bear all fees payable to
Shareholder Organizations for their services with respect to such shares.
The services to be provided by each Shareholder Organization include the
following: aggregating and processing purchase and redemption requests from
Customers and placing net purchase and redemption orders with the Distributor;
providing Customers with a service that invests the assets of their other
investment accounts in Hamilton Classic Shares automatically, pursuant to
specific preauthorized instructions; processing dividend payments on behalf of
Customers; providing information periodically to Customers regarding their
position in Hamilton Classic Shares; arranging for bank wires; responding to
Customer inquiries regarding services performed by the Shareholder
Organizations; providing sub-accounting with respect to shares beneficially
owned by Customers or the information necessary for sub-accounting; forwarding
shareholder communications from the Fund to Customers; and other similar
services as agreed to with the Fund.
The Fund will accrue, as expenses, fees payable made pursuant to the Plan
daily. The Shareholder Servicing Agreements require each Shareholder
Organization to waive a portion of any payment such organization is entitled to
receive pursuant to the Plan to the extent necessary to assure that the Plan
payments required to be charged to the Fund's Hamilton Classic Shares on any day
do not exceed the income to be accrued to such shares on that day.
(12) PROSPECTUS
<PAGE>
BNY Hamilton Funds, Inc. understands that Shareholder Organizations may
charge fees to their Customers who are the beneficial owners of Hamilton
Classic Shares in connection with their Customer accounts. These fees would be
in addition to any amounts the Fund may pay a Shareholder Organization under a
Shareholder Servicing Agreement. Under the terms of the Shareholder Servicing
Agreements, Shareholder Organizations are required to disclose the compensation
payable to them by the Fund and any other compensation payable by their
Customers in connection with the investment of their assets in the Fund.
Customers of Shareholder Organizations should read this Prospectus in
conjunction with the terms governing their accounts with their Shareholder
Organizations.
Conflict-of-interest restrictions may apply to an institution's receipt of
compensation paid by a Fund in connection with the investment of fiduciary funds
in Hamilton Classic Shares. Institutions, including banks regulated by the
Comptroller of the Currency, the Federal Reserve Board or the Federal Deposit
Insurance Corporation, and investment advisers and other money managers subject
to the jurisdiction of the Securities and Exchange Commission, the Department of
Labor or state securities commissions, are urged to consult their legal advisers
before investing fiduciary funds in the Fund.
Banks may act as Shareholder Organizations. The Glass-Steagall Act and
other applicable laws, among other things, prohibit banks from engaging in the
business of underwriting securities. If a bank were prohibited from acting as a
Shareholder Organization, its shareholder clients would be permitted by the Fund
to remain shareholders of the Fund and alternative means for continuing the
servicing of such shareholders would be sought. In such event, changes in the
operation of the Fund might occur and a shareholder serviced by such bank might
no longer be able to avail itself of automatic investment or other services then
being provided by the bank. It is not expected that shareholders would suffer
any adverse financial consequences as a result of any of these occurrences.
In connection with the sale of Hamilton Classic Shares, the Fund obtains
representations from Shareholder Organizations (including The Bank of New York
and the Administrator) that they are or will be licensed as dealers as required
by applicable law or will not engage in activities which would require them to
be so licensed.
FEE WAIVERS
Except as noted in this Prospectus and the Statement of Additional Information,
the Fund's service contractors bear all expenses in connection with the
performance of its services and the Fund (and each class thereof) bears the
expenses incurred in its operation. From time to time during the course of the
Fund's fiscal year, each of the Administrator and the Adviser may voluntarily
elect not to receive payment of fees under their respective agreements described
above and/or to assume certain expenses of the Fund (or class thereof), while
retaining the ability to be reimbursed by the Fund for such amount prior to the
end of the fiscal year. This will have the effect of increasing yield to
investors at the time such fees are not requested to be paid to, or amounts are
assumed by, the Administrator or the Adviser and decreasing yield when such fees
or amounts are reimbursed to the Administrator or the Adviser.
PROSPECTUS (13)
<PAGE>
SHAREHOLDER
SERVICES
Hamilton Classic Shares of the Fund may be purchased directly from the
Distributor, without any charge by the Fund. The minimum initial investment is
$2,000 and the minimum subsequent investment is $100.
An investor desiring to purchase shares by mail should complete an Account
Application and mail the application and a check payable to 'BNY Hamilton Money
Fund', to BNY Hamilton Funds, P. O. Box 163310, Columbus, Ohio 43216-3310. All
subsequent payments should be mailed to BNY Hamilton Funds, Inc., P.O. Box 806,
Newark, New Jersey 07101-0806. An investor desiring to purchase shares by wire
should call the transfer agent at 1-800-952-6276 and place a purchase order. The
investor's bank should be instructed to transmit immediately available funds by
wire to The Bank of New York, ABA No. 021000018, BNY Hamilton Funds, DDA No.
8900275847, BNY Hamilton Money Fund for purchase of shares in the investor's
name. It is important that the wire include the investor's name, address and tax
identification number (social security number for individuals), indicate whether
a new account is being established or a subsequent investment is being made to
an established account and indicate the name of the Fund. If a subsequent
investment is being made, the investor's Fund account number should be included.
An investor should contact his or her bank for information on remitting funds in
this manner, including any charges imposed by the bank for wiring funds.
A fee will be imposed by the transfer agent if any check used for
investment in an account does not clear. All payments should be in U.S. dollars
and drawn on U.S. banks. Third party checks will not be accepted. Purchase
orders in proper form are effected on a day in which the Federal Reserve Bank of
New York and the New York Stock Exchange are open for business (a 'Business
Day') at the net asset value per share next determined after receipt by the
transfer agent at its office of both an order and federal funds. Purchases will
not be effected until payments made in other than federal funds are converted to
federal funds, which is ordinarily within two business days of receipt.
TELETRADE PURCHASES
Although this privilege may not be used to make an initial purchase, an
investment in Hamilton Classic Shares of the Fund automatically entitles an
investor to purchase shares (minimum of $500 and maximum of $50,000 per
transaction) without charge by telephone unless the investor indicates on the
Account Application or in a subsequent written notice to the transfer agent that
he or she does not wish to use the TeleTrade privilege. Appropriate information
concerning the investor's bank must be provided on the Account Application or in
a subsequent signature guaranteed letter of instruction to the transfer agent
before the TeleTrade privilege may be used. The proceeds will be transferred
between the checking, NOW or bank money account designated in one of these
documents and the investor's account. Only an account maintained at a domestic
financial institution which is an Automated Clearing House member may be so
designated. TeleTrade purchases will be effected at the net asset value next
determined after receipt of payment by the transfer agent. The Fund may modify
this privilege at any time or charge a service fee upon notice to shareholders.
No such fee currently is contemplated. An investor who has selected the
TeleTrade privilege may request TeleTrade purchases by telephoning the transfer
agent at 1-800-952-6276.
(14) PROSPECTUS
<PAGE>
INDIVIDUAL RETIREMENT ACCOUNTS
Investors may purchase Hamilton Classic Shares of the Fund through an
individual retirement account ('IRA') made available by BNY Hamilton Funds,
Inc. For details regarding the purchase of Hamilton Classic Shares through an
IRA, please call 1-800-4BNY-FND (1-800-426-9363). Investors are advised to
consult their own legal counsel or tax adviser regarding these investments.
Individuals who open an IRA may also open a non-working spousal IRA with a
minimum investment of $250. Investors should also read the IRA Disclosure
Statement and the Bank Custodial Agreement for further details as to
eligibility, service fees and tax implications.
Investors may also purchase an IRA made available by BNY Hamilton Funds,
Inc. for any of the Equity Income Funds, the Taxable Fixed Income Funds, or BNY
Hamilton Intermediate Tax-Exempt Fund. Investors are urged to read the
prospectuses for those funds before investing or sending money.
AUTOMATIC INVESTMENT PROGRAM
The Fund also makes available an Automatic Investment Program, which permits an
investor to purchase Hamilton Classic Shares (minimum $50 per transaction) at
regular intervals selected by the investor. Provided the investor's financial
institution allows automatic withdrawals, shares are purchased by transferring
funds from an investor's checking, bank money market or NOW account designated
by the investor. At the investor's option, the account designated will be
debited in the specified amount, and shares will be purchased, once a month, on
either the first or fifteenth day, or twice a month, on both days. Only an
account maintained at a domestic financial institution which is an Automated
Clearing House member may be so designated. THE MINIMUM INITIAL INVESTMENT
REQUIREMENT FOR INVESTORS ESTABLISHING AN AUTOMATIC INVESTMENT ACCOUNT IS $500.
To establish an Automatic Investment account, an investor must check the
appropriate box and supply the necessary information on the Account Application
or subsequently file a written request with the transfer agent. Such
applications are available from the Distributor. An investor may cancel this
privilege or change the amount of purchase at any time by mailing written
notification to the transfer agent at BNY Hamilton Funds, P. O. Box 163310,
Columbus, Ohio 43216-3310 and notification will be effective seven days
following receipt. The Fund may modify or terminate this privilege at any time
or charge a service fee, although no such fee is currently contemplated.
GOVERNMENT DIRECT DEPOSIT PROGRAM (SPECIFIC GUIDELINES FOR INVESTORS RECEIVING
INCOME FROM THE FEDERAL GOVERNMENT)
If an investor receives federal salary, social security, or certain veteran's,
military or other payments from the federal government, he or she is eligible
for the Direct Deposit Program. With this Program, an investor may purchase
Hamilton Classic Shares of the Fund (minimum of $100 and maximum of $50,000 per
transaction) by having these payments automatically deposited into his or her
Fund account. For instructions on how to enroll in the Direct Deposit Program,
an investor should call the transfer agent at 1-800-952-6276. Death or legal
incapacity will terminate an investor's participation in the Direct Deposit
Program. An investor may elect at any time to terminate his or her participation
by notifying the appropriate federal agency. Further, the Fund may terminate an
investor's participation upon 30 days' notice to the investor.
PROSPECTUS (15)
<PAGE>
EMPLOYEE DIRECT DEPOSIT PROGRAM (EMPLOYEES AND RETIREES OF THE BANK OF NEW YORK)
In certain circumstances, employees and retirees of The Bank of New York and its
affiliates may purchase Hamilton Classic Shares of the Fund by having payments
automatically deposited into their specific Fund account. Call 1-800-4BNY-FND
(1-800-426-9363) for details. For employees and retirees of The Bank of New York
and its affiliates, the minimum initial investment is $100 and the minimum
subsequent investment is $25.
REGULAR REDEMPTION
An investor may redeem shares in any amount by sending a written request to the
BNY Hamilton Funds, P. O. Box 163310, Columbus, Ohio 43216-3310. Redemption
orders are effected upon receipt by the transfer agent at its office.
Redemption requests must be signed by each shareholder, including each
joint owner on redemption requests for joint accounts. A redemption request for
(i) an amount in excess of $50,000 per day (ii) any amount if the proceeds are
to be sent elsewhere than to the address of record, and (iii) an amount of
$50,000 or less if the address of record has not been on file with the transfer
agent for a period of 60 days, must be accompanied by a signature guarantee. The
guarantor of a signature must be a bank that is a member of the FDIC, a trust
company, a member firm of a national securities exchange or other eligible
guarantor institution. The transfer agent will not accept guarantees from
notaries public. Guarantees must be signed by an authorized signatory of the
guarantor institution and 'Signature Guaranteed' must appear with the signature.
TELETRADE REDEMPTIONS
An investor may redeem shares in the same manner and subject to the same
limitations as described under 'TeleTrade Purchases' earlier in this section. An
investment in Hamilton Classic Shares of the Fund automatically entitles an
investor to redeem his or her shares by telephone unless it is indicated on the
Account Application that he or she does not wish to use the TeleTrade privilege.
In most cases redemption proceeds will be on deposit in the investor's account
at a domestic financial institution which is an Automated Clearing House member
bank two business days after receipt of the redemption request. An investor may
also request the redemption proceeds be sent by check. Checks will be sent only
to the registered owner(s) and only to the address of record. Telephone
privileges will be suspended for a period of ten days following a change of
address. An investor who has selected the TeleTrade privilege may request
TeleTrade redemptions by telephoning the transfer agent at 1-800-952-6276.
Neither the Fund nor any of its service contractors will be liable for any loss
or expense for acting upon any telephone instructions that are reasonably
believed to be genuine. In attempting to confirm that telephone instructions are
genuine, the Fund will use such procedures as it considers reasonable as
described in 'Redemption of Shares' in the Statement of Additional Information.
(16) PROSPECTUS
<PAGE>
WIRE REDEMPTION
An investment in Hamilton Classic Shares of the Fund automatically entitles
an investor to redeem shares by wire unless the investor indicates on the
Account Application or in a subsequent signature guaranteed written notice to
the transfer agent that he or she does not wish to use this method of
redemption. Appropriate information concerning the investor's bank must be
provided on the Account Application or in a subsequent signature guaranteed
letter of instruction to the transfer agent before shares may be redeemed by
wire. Shareholders may instruct the transfer agent to redeem shares on written,
telegraphic, or telephone instructions from any person representing to be the
investor and believed by the transfer agent to be genuine. The responsibility of
the transfer agent and certain other parties for telephonic instruction believed
to be genuine is discussed in 'TeleTrade Redemptions' earlier in this section.
The proceeds of redemption will normally be wired in federal funds to the
commercial bank specified by the investor in the Account Application. Redemption
proceeds must be in an amount of at least $1,000, and may be subject to limits
as to frequency and overall amount. Wire redemptions may be terminated or
modified by the Fund at any time. A shareholder should contact his or her bank
for information on any charges imposed by the bank in connection with the
receipt of redemption proceeds by wire.
During periods of substantial economic or market change, telephone wire
redemptions may be difficult to implement. If an investor is unable to contact
the transfer agent by telephone, shares may also be redeemed by delivering the
redemption request in person to the transfer agent or by mail as described above
under 'Regular Redemption'. For additional information concerning wire
redemptions, see the Statement of Additional Information and the Account
Application.
CHECK REDEMPTION
An investor may request on the Account Application that the Fund provide
redemption checks ('Checks') drawn on the Hamilton Classic Shares. Checks will
be sent only to the registered owner(s) and only to the address of record. The
Account Application must be manually signed by the registered owner(s). Checks
may be made payable to the order of any person in the amount of $500 or more.
Dividends are earned until the Check clears the Fund. When a Check is presented
to the transfer agent for payment, the transfer agent, as the investor's agent,
will cause the Fund to redeem a sufficient number of the investor's shares to
cover the amount of the Check. There is no charge to the investor for the use of
the Checks; however, the transfer agent will impose a charge for stopping
payment of a Check upon the request of the investor, or if the transfer agent
cannot honor a Check due to insufficient funds or other valid reasons. Because
dividends accrue daily, Checks cannot be used to close an account, as a small
balance is likely to result.
OTHER REDEMPTION INFORMATION
Redemption orders are effected at the net asset value per share next determined
after receipt of the order by the transfer agent. The Fund ordinarily will make
payment for all shares redeemed within seven days after receipt by the transfer
agent of a request in proper form, except as provided by the rules of the
Securities and Exchange Commission. However, if the shares to be redeemed have
been purchased by check or TeleTrade, the Funds may be requested to redeem
shares for which it has not yet received good payment. In such circumstances,
the Funds may
PROSPECTUS (17)
<PAGE>
delay the forwarding of proceeds for up to 15 days or more until payment has
been collected for the purchase of such shares. This procedure does not apply to
situations where the Fund receives payment in cash or immediately available
funds for the purchase of shares. During the period prior to the time the shares
are redeemed, dividends on such shares will accrue and be payable, and an
investor will be entitled to exercise all other rights of beneficial ownership.
An investor having purchased shares by wire must have filed an Account
Application before any redemption requests can be honored.
The Fund reserves the right to redeem accounts (other than non-working
spousal IRA accounts) involuntarily, upon 60 days' written notice, if the
account's net asset value falls below the $500 minimum balance as a result of
redemptions. Accounts that fall below $500 solely as a result of market
fluctuations will not be subject to redemption by the Fund.
AUTOMATIC WITHDRAWAL PLAN
Investors having a $5,000 minimum account balance may request withdrawal of a
dollar amount in multiples of $50 on a monthly, quarterly, semi-annual or annual
basis. At the investor's option, monthly withdrawals will be made on either the
first or fifteenth day of the month and quarterly, semi-annual or annual
withdrawals will be made on either the first or fifteenth day of the month
selected. To participate in the automatic withdrawal plan, an investor must
check the appropriate box and supply the necessary information on the Account
Application which may be obtained from the Distributor or subsequently file a
signature guaranteed written request with the transfer agent.
PURCHASE
OF SHARES
Fund shares are sold at the net asset value per share next determined after
receipt of a purchase order by the transfer agent. The Fund does not impose any
fee for purchase orders placed directly with the transfer agent without the
assistance of a broker-dealer. Broker-dealers (other than the Distributor) and
others who process purchase orders on behalf of Customers may charge a fee for
their services.
Purchase orders for shares are accepted by the Fund only on a day on which
both the New York Stock Exchange and the custodian are open for business (a
'Business Day'). As used herein, a 'Business Day' is a day on which the New York
Stock Exchange is open for trading and any other day (other than a day on which
no shares of the Fund are tendered for redemption and no order to purchase
shares is received) during which there is sufficient trading in the Fund's
portfolio securities that the Fund's net asset value per share might be
materially affected. Purchase orders received by the transfer agent before 4:30
p.m. Eastern time on a Business Day for the Fund will be executed as of the
times noted for the Fund, if payment is received by the times noted for the
respective Fund. Orders received after the times noted for the Fund, and orders
for which payment has not been received by the times noted for the Fund, will
not be accepted. The Fund may in its discretion reject any order for shares.
Payment for orders which are not received or paid for in a timely manner or are
not accepted by the Fund will be returned after prompt notification to the
sending institution. On those days when the New York Stock Exchange or the
custodian closes early as a result of such day being a partial holiday or
otherwise, the right is reserved to advance the time on that day by which
purchase orders and redemption requests must be received.
(18) PROSPECTUS
<PAGE>
Payment for shares may be made only in federal funds or other funds
immediately available to the transfer agent. Purchases made by check are not
permitted to be redeemed until payment of the purchase has been collected,
which may take up to ten business days after purchase. The Fund reserves the
right to suspend the sale of shares to the public at any time, in response to
conditions in the securities markets or otherwise.
Investors in Hamilton Classic Shares are automatically entitled to purchase
additional Fund shares by telephone unless they notify the transfer agent in
writing that they do not wish to use this telephone privilege. There is no
charge for the telephone purchase privilege. For details concerning this
privilege, see 'Shareholder Services--TeleTrade Purchases'.
The Distributor, from time to time, at its expense, will provide
compensation to dealers in connection with sales of shares of any other funds in
the BNY Hamilton Family of Funds. Such compensation will include non-cash
payments which may take the form of (1) gift certificates, (2) tickets for
entertainment events, (3) trips, including the provision of travel arrangements
and lodging at vacation resorts and (4) merchandise. Dealers may not use sales
of any Funds' shares to qualify for this compensation to the extent such sales
may be prohibited by laws of any state or any self-regulatory agency, such as
the National Association of Securities Dealers, Inc. None of the aforementioned
compensation is paid for by any series of BNY Hamilton Funds, Inc. or its
shareholders.
Federal regulations require that each investor provide a certified Taxpayer
Identification Number (social security number for individuals) upon opening or
reopening an account with the Fund. Investors should refer to the section
entitled 'Taxes' for further information about this requirement.
In the interest of economy and convenience and because of its operating
procedures, the Fund will not issue certificates representing ownership of
shares. All shares purchased will be confirmed and credited to investors'
accounts on the books maintained by the Adviser or its agents for each class of
the Fund.
REDEMPTION
OF SHARES
Redemption orders are effected at the net asset value per share next determined
after receipt of the order by the transfer agent. Payment for redeemed shares
for which a redemption order is received by the transfer agent prior to 4:30
p.m. Eastern time for the Fund on a Business Day is normally made in federal
funds wired to the redeeming shareholder on the same Business Day. Payment for
redeemed shares for which a redemption order is received after the time stated
above on a Business Day is normally made in federal funds wired to the redeeming
shareholder on the next Business Day following redemption. In order to allow The
Bank of New York to most effectively manage the Fund, investors are urged to
initiate redemptions of shares as early in the day as possible and to notify the
transfer agent at least one day in advance of redemptions in excess of $5
million. The Fund reserves the right to wire redemption proceeds up to seven
days after receiving the redemption order if, in the judgment of the Adviser, an
earlier payment could adversely affect the Fund. Investors in Hamilton Classic
Shares are automatically entitled to redeem shares, without charge, by
telephone, unless they notify the transfer agent in writing that they do not
wish to use this telephone privilege.
PROSPECTUS (19)
<PAGE>
None of the Fund, the Distributor, the transfer agent or the Fund's other
service contractors will be responsible for any loss or expense for acting upon
telephone instructions that they believe to be genuine. In attempting to confirm
that telephone instructions are genuine, the Fund and its service contractors
will use such procedures as they consider reasonable as described in 'Redemption
of Shares' in the Statement of Additional Information. To the extent that the
Fund or its service contractors does not use reasonable procedures to form their
belief as to the genuineness of accountholders' instructions, it and/or its
service contractors may be responsible for such instructions as are fraudulent
or unauthorized.
Redemption orders submitted directly to the transfer agent without the
assistance of a broker-dealer or other person, and orders submitted by the
Distributor for its brokerage customers, are processed without charge.
Broker-dealers (other than the Distributor) and others who process redemption
orders on behalf of their customers may charge a fee for their services.
EXCHANGE
OF SHARES
An investor may exchange shares between the Hamilton Classic Shares and any
other fund in the BNY Hamilton Family of Funds described in the relevant
prospectuses for the Equity Funds, the Taxable Fixed Income Funds or the
Tax-Exempt Fixed Income Funds.
Shareholders of the Fund must request and obtain a current copy of the
relevant prospectus before exchanging their investment for an initial investment
in one of the other members of the BNY Hamilton Family of Funds. Investors
considering such an exchange of shares are urged to read the relevant prospectus
carefully prior to exchange.
An exchange may be made so long as the shares to be exchanged have a value
of at least $500, and the shares to be purchased in the exchange may legally be
sold in the state of the investor's residence. If a shareholder is establishing
a NEW account by exchange, shares of the specific Fund being exchanged must have
a value at least equal to the minimum initial investment required by the
specific Fund into which the exchange is being made (currently $2,000 for
Investor Shares for each of the Equity Funds, the Taxable Fixed Income Funds and
the Tax-Exempt Fixed Income Funds). Shares will be exchanged on the basis of
relative net asset value per share.
An investment in the Fund automatically entitles an investor to use the
exchange privilege unless he or she indicates on the Account Application or in a
subsequent written notice to the transfer agent that he or she does not wish to
use this privilege. The relevant prospectuses for the other portfolios of the
BNY Hamilton Family of Funds into which an exchange is being made may be
obtained from the investor's Service Organization or the Distributor. A
shareholder may exchange shares by telephone by calling the transfer agent at
1-800-952-6276. Telephone privileges will be suspended for a period of ten days
following a change of address. See 'Shareholder Services--TeleTrade Redemptions'
for a description of the Fund's policy regarding responsibility for telephone
instructions. An investor desiring to use the exchange privilege should read the
Statement of Additional Information and consult his or her Service Organization
or the Distributor for further information applicable to use of the exchange
privilege. The BNY Hamilton Family of Funds reserves the right to reject any
exchange request and the exchange privilege may be modified or terminated at any
time. At least 60 days' notice will be given to shareholders of any material
modification or termination except where notice is not required under
regulations of the Securities and Exchange Commission.
(20) PROSPECTUS
<PAGE>
Exchanges are in effect redemptions from one member of the BNY Hamilton
Family of Funds and purchases of another member of the BNY Hamilton Family of
Funds and the usual purchase and redemption procedures and requirements are
applicable to exchanges. Also see 'Purchase of Shares' and 'Redemption of
Shares' in this prospectus and the other prospectuses.
DIVIDENDS
AND DISTRIBUTIONS
The net investment income for the Hamilton Classic Shares of the Fund will be
declared as dividends daily and paid monthly within five (5) Business Days after
the end of the month. Dividends and distributions will be payable to
shareholders of record at the time of declaration.
The net investment income of the Hamilton Classic Shares of the Fund for
each Business Day will be determined immediately prior to the determination of
net asset value. Net investment income for other days will be determined on the
prior Business Day. Shares of the Hamilton Classic Shares of the Fund will begin
earning dividends on the Business Day their purchase is effective. See 'Purchase
of Shares' and 'Redemption of Shares'. The Directors may, without action by the
shareholders, revise the dividend policy or postpone the payment of a dividend
by the Fund if it incurs or anticipates any large unexpected expense, loss or
fluctuation in net assets that in the Directors' opinion might have a
significant adverse effect on shareholders.
Dividends on shares of the Fund generally are determined in the same manner
regardless of class, except that Hamilton Premier Shares (not included herein)
and Hamilton Classic Shares bear the fees paid to their respective Shareholder
Organizations for those general services described under 'Fund and Other
Shareholder Services--General--Shareholder Servicing Plan'. In addition,
Hamilton Classic Shares bear 12b-1 fees, and each class of shares bears certain
other miscellaneous 'class specific expenses' (i.e., certain registration and
transfer agency expenses).
If you elect to receive distributions in cash, and the checks (1) are
returned and marked as 'undeliverable' or (2) remain uncashed for six months,
your cash election will be changed automatically and your future dividend and
capital gains distributions will be reinvested in the Fund at the per share net
asset value determined as of the date of payment of the distribution. In
addition, any undeliverable checks or checks that remain uncashed for six months
will be canceled and will be reinvested in the Fund at the per share net asset
value determined as of the date of cancellation.
The Fund does not expect to realize long-term capital gains or losses.
However, should the Fund do so, any net realized gains will be distributed at
least annually.
NET ASSET
VALUE
Net asset value per share for the Hamilton Classic Shares of the Fund will be
determined by subtracting from the value of the Fund's total assets attributable
to the Hamilton Classic Shares the amount of the Fund's liabilities attributable
to shares of that class, dividing the remainder by the number of outstanding
shares of that class and rounding to the nearest one cent. Expenses, including
the fees payable to the Adviser and the Administrator, are accrued daily. The
Fund will value its portfolio securities using the amortized cost method. This
method attempts to maintain a constant net asset value per share of $1.00. No
assurances can be given that this goal will be attained. See 'Net Asset Value'
in the Statement of Additional Information for more information on valuation of
portfolio securities of the Fund.
PROSPECTUS (21)
<PAGE>
The Fund computes the net asset value of the Hamilton Classic Shares once
daily on Monday through Friday, except that the net asset value need not be
computed on a day in which no orders to purchase or redeem Hamilton Classic
Shares have been received or on the holidays listed under 'Net Asset Value' in
the Statement of Additional Information. The Fund will compute net asset value
of its respective classes at 4:30 P.M. Eastern time.
ORGANIZATION
BNY Hamilton Funds, Inc. is an open-end management investment company organized
as a Maryland corporation on May 1, 1992. The Articles of Incorporation
currently permit BNY Hamilton Funds, Inc. to issue 20,000,000,000 shares of
common stock, par value $.001 per share, which have been allocated as follows:
<TABLE>
<CAPTION>
NUMBER OF
NAME OF FUND AND CLASS THEREOF SHARES AUTHORIZED
<S> <C>
- -----------------------------------------------------------------------------------
BNY Hamilton Money Fund--Hamilton Classic Shares............... 3,000,000,000
</TABLE>
The Directors may increase the number of shares each Fund is authorized to
issue without the approval of shareholders. The Directors also have the power to
designate one or more series or classes of shares of common stock and to
classify and reclassify any unissued shares with respect to such series or
classes.
Shareholders of each series of BNY Hamilton Funds, Inc. are entitled to one
vote for each share and to the appropriate fractional vote for each fractional
share. There is no cumulative voting and the Fund's shares have no preemptive or
conversion rights. All shareholders will vote together as a single class on
matters affecting the Fund generally, including matters relating to the Fund's
investment advisory agreement, investment objective and fundamental investment
restrictions. Shareholders of a particular class will vote separately on any
matters relating only to that class. For example, to the extent shareholder
votes are necessary, holders of Hamilton Classic Shares of the Fund will vote
separately on matters pertaining to their respective shareholder servicing
arrangements and holders of Hamilton Classic Shares of the Fund will vote
separately on matters relating to the class' distribution plan under Rule 12b-1.
Shares offered hereby must be fully-paid upon issuance and thereafter will
be non-assessable by BNY Hamilton Funds, Inc. and the particular Fund to which
they belong. The Funds do not intend to hold meetings of shareholders. The
Directors may call meetings of shareholders for action by shareholder vote as
may be required by the 1940 Act or permitted by the Articles of Incorporation or
Bylaws of BNY Hamilton Funds, Inc.
BNY Hamilton Funds, Inc., if requested to do so by the holders of at least
10% of the shares of all series aggregated as a class, will call a meeting of
shareholders for the purpose of voting upon the removal of a director or
directors and will assist in communications with other shareholders as required
by Section 16(c) of the 1940 Act. For further organization information,
including certain shareholder rights, see 'Description of Shares' in the
Statement of Additional Information.
TAXES
The following discussion of federal tax consequences is based on the United
States tax laws in effect on the date of this Prospectus. These laws and
regulations are subject to change by legislative, judicial or administrative
action. Investors are urged to consult their own tax advisors with respect to
specific questions as to federal taxes and with respect to the applicability of
state, local or foreign taxes. See 'Taxes' in the Statement of Additional
Information.
(22) PROSPECTUS
<PAGE>
Annual statements as to the federal tax status of distributions will be
mailed to shareholders shortly after the end of the taxable year.
The Fund intends to qualify as a regulated investment company under
Subchapter M of the Tax Code. As a regulated investment company, the Fund will
not be subject to federal income taxes on the net investment income and capital
gains distributed to shareholders, provided that it distributes annually at
least 90% of its net investment income and realized net short-term capital gains
in excess of net long-term capital losses.
Distributions of net investment income and realized net short-term capital
gains in excess of net long-term capital losses will be taxable to shareholders
of the Fund as ordinary income, whether such distributions are taken in cash or
reinvested in additional shares. Such distributions will not be eligible for the
dividends-received deduction.
Distributions of net long-term capital gains in excess of net short-term
capital losses, if any, will be taxable to shareholders of the Fund as long-term
capital gains regardless of how long the shareholders have held their shares and
regardless of whether taken in cash or reinvested in additional shares.
Long-term capital gains distributions will not be eligible for the
dividends-received deduction. Individual shareholders will be subject to federal
income tax on distributions of net long-term capital gains at a maximum rae of
28% if designated as derived from a Fund's capital gains from property held for
more than one year and at a maximum rate of 20% if designated as derived from
property held for more than eighteen months.
UNLESS A SHAREHOLDER INCLUDES ITS TAXPAYER IDENTIFICATION NUMBER (SOCIAL
SECURITY NUMBER FOR INDIVIDUALS) ON THE ACCOUNT APPLICATION AND CERTIFIES THAT
IT IS NOT SUBJECT TO BACKUP WITHHOLDING, THE FUND MAY BE REQUIRED TO WITHHOLD
AND REMIT TO THE U.S. TREASURY 31% OF TAXABLE DISTRIBUTIONS AND OTHER REPORTABLE
PAYMENTS TO THE SHAREHOLDER. SHAREHOLDERS SHOULD BE AWARE THAT, UNDER
REGULATIONS PROMULGATED BY THE INTERNAL REVENUE SERVICE, THE FUND MAY BE FINED
UP TO $50 ANNUALLY FOR EACH ACCOUNT FOR WHICH A CERTIFIED TAXPAYER
IDENTIFICATION NUMBER IS NOT PROVIDED. IN THE EVENT THAT SUCH A FINE IS IMPOSED
WITH RESPECT TO ANY UNCERTIFIED ACCOUNT IN ANY YEAR, A CORRESPONDING CHARGE MAY
BE MADE AGAINST THAT ACCOUNT.
ADDITIONAL INFORMATION
The Fund will send to its shareholders annual and semi-annual reports. The
financial statements appearing in the annual reports will be audited by
independent auditors. Shareholders will also receive confirmations of each
purchase and redemption and monthly statements, reflecting all account activity,
including dividends reinvested in additional shares or credited as cash. Written
inquiries should be addressed to the Fund as follows:
BNY Hamilton Funds
P. O. Box 163310
Columbus, OH 43216-3310
The Fund may make historical performance information available and may
advertise yield and effective yield as those terms are defined in the Statement
of Additional Information under Performance Data. The yield for the Hamilton
Classic Shares may be compared to the yield of other mutual funds with similar
investment objectives and services and to other relevant indices or to rankings
prepared by independent services or other financial or industry publications
that monitor the performance of mutual funds. For example, the yield for the
Hamilton Classic Shares may be compared to Money Fund Report, a service of IBC
Financial Data, Inc. Yield data as reported in national financial publications,
including but not limited to Money, Forbes, Barrons, The Wall Street Journal and
The New York Times, or in publications of a local or regional nature, may also
be used in comparing the Fund's yield. All performance figures will be based on
historical earnings and are not intended to indicate future performance.
Performance information may be obtained by calling the Distributor at
(1-800-4BNY-FND).
PROSPECTUS (23)
<PAGE>
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<PAGE>
[This page intentionally left blank]
<PAGE>
[This page intentionally left blank]
<PAGE>
BNY HAMILTON EQUITY FUNDS
125 West 55th Street
New York, New York 10019
For information call 1-800-426-9363 (1-800-4BNY-FND)
BNY Hamilton Funds, Inc. is a family of no-load mutual funds for which there are
no sales charges or exchange or redemption fees. This Prospectus describes four
(4) equity funds (individually, a 'Fund' and collectively, the 'Funds') offered
by the BNY Hamilton Family of Funds.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
FUND OBJECTIVE FOR INVESTORS SEEKING
- ---------------------------------------------------------------------------------------
<S> <C> <C>
BNY HAMILTON To provide long-term capital Capital appreciation, higher
EQUITY INCOME appreciation greater than the than market average income
FUND appreciation of, and yield greater with relatively low volatility
than the yield of, the Standard &
Poor's 500 Index. Equal emphasis is
placed on attaining income and
capital appreciation
- ---------------------------------------------------------------------------------------
BNY HAMILTON To provide long-term capital Long-term growth with current
LARGE CAP GROWTH appreciation by investing primarily income being a secondary
FUND in common stock and securities objective
convertible to common stock; current
income is a secondary consideration
- ---------------------------------------------------------------------------------------
BNY HAMILTON To provide long-term capital Long-term growth; moderate to
SMALL CAP GROWTH appreciation by investing primarily high risk
FUND in equity securities of small
domestic and foreign corporations
- ---------------------------------------------------------------------------------------
BNY HAMILTON To provide long-term capital Higher than market average
INTERNATIONAL appreciation by investing primarily long- term growth; high risk
EQUITY FUND in equity securities of non- U.S.
issuers
- ---------------------------------------------------------------------------------------
</TABLE>
INVESTMENTS IN ANY OF THE FUNDS ARE NOT BANK DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR INSURED BY, THE BANK OF NEW YORK, AND THE SHARES IN ANY OF THE
FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE UNITED STATES GOVERNMENT, THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENTAL AGENCY. INVESTMENTS IN ANY OF THE FUNDS INVOLVE INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
This Prospectus sets forth concisely the information that a prospective investor
should know about the Funds before investing and should be retained for future
reference. Additional information about the Funds or other members of the BNY
Hamilton Family of Funds has been filed with the Securities and Exchange
Commission in the Statement of Additional Information for BNY Hamilton Funds,
Inc., dated April 30, 1998. This information is incorporated by reference and is
available without charge upon request from the Funds' distributor, BNY Hamilton
Distributors, Inc., 125 West 55th Street, New York, NY 10019, Attention: BNY
Hamilton Funds, Inc. 1-800-4BNY-FND (1-800-426-9363).
- --------------------------------------------------------------------------------
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 date of this Prospectus is April 30, 1998 5/98 BNY-0090
PROSPECTUS
<PAGE>
TABLE
OF
CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Fee Table 1
- --------------------------------------------------------------------
Financial Highlights 5
- --------------------------------------------------------------------
Investment Objectives and Policies 9
- --------------------------------------------------------------------
Description of Securities 10
- --------------------------------------------------------------------
Additional Investment Information and Risk Considerations 12
- --------------------------------------------------------------------
Investment Restrictions 20
- --------------------------------------------------------------------
Management of the Funds 21
- --------------------------------------------------------------------
Summary of Shareholder Services 23
- --------------------------------------------------------------------
Fund and Other Shareholder Services 24
- --------------------------------------------------------------------
Purchase of Shares 26
- --------------------------------------------------------------------
Redemption of Shares 30
- --------------------------------------------------------------------
Exchange of Shares 32
- --------------------------------------------------------------------
Dividends and Distributions 32
- --------------------------------------------------------------------
Net Asset Value 33
- --------------------------------------------------------------------
Organization 34
- --------------------------------------------------------------------
Taxes 35
- --------------------------------------------------------------------
Additional Information 36
- --------------------------------------------------------------------
Appendix A 37
- --------------------------------------------------------------------
Appendix B 38
- --------------------------------------------------------------------
</TABLE>
PROSPECTUS
<PAGE>
FEE
TABLE
The following table illustrates the expenses an investor in any one of the Funds
will incur. In addition, investments are subject to the annual fund operating
expenses (after limitations) set forth below.
<TABLE>
<CAPTION>
BNY HAMILTON BNY HAMILTON
EQUITY INCOME LARGE CAP
FUND GROWTH FUND
---------------------------------------------------
INSTITUTIONAL INVESTOR INSTITUTIONAL INVESTOR
SHARES SHARES SHARES SHARES
---------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER
TRANSACTION EXPENSES:
Sales Load Imposed On
Purchases................. None None None None
Sales Load Imposed on
Reinvested Dividends...... None None None None
Deferred Sales Load......... None None None None
Redemption Fees............. None None None None
Exchange Fees............... None None None None
ANNUAL FUND OPERATING EXPENSES
(AFTER LIMITATIONS):
(AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS)
Management Fees (After
Limitations).............. .80% .80% .74% .74%
12b-1 Fees (After
Limitations).............. .00% .25% .00% .22%
Other Expenses.............. .07% .07% .08% .11%
---------------------------------------------------
Total Fund Operating
Expenses (After
Limitations).............. .87% 1.12% .82% 1.07%
---------------------------------------------------
---------------------------------------------------
</TABLE>
(1) PROSPECTUS
<PAGE>
<TABLE>
<CAPTION>
BNY HAMILTON BNY HAMILTON
SMALL CAP INTERNATIONAL
GROWTH FUND EQUITY FUND
---------------------------------------------------
INSTITUTIONAL INVESTOR INSTITUTIONAL INVESTOR
SHARES SHARES SHARES SHARES
---------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION
EXPENSES:
Sales Load Imposed On
Purchases................. None None None None
Sales Load Imposed on
Reinvested Dividends...... None None None None
Deferred Sales Load......... None None None None
Redemption Fees............. None None None None
Exchange Fees............... None None None None
ANNUAL FUND OPERATING EXPENSES
(AFTER LIMITATIONS):
(AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS)
Management Fees (After
Limitations).............. .82% .82% .83% .83%
12b-1 Fees (After
Limitations).............. .00% .20% .00% .24%
Other Expenses.............. .15% .20% .44% .45%
---------------------------------------------------
Total Fund Operating
Expenses (After
Limitations).............. .97% 1.22% 1.27% 1.52%
---------------------------------------------------
---------------------------------------------------
</TABLE>
PROSPECTUS (2)
<PAGE>
EXAMPLE:
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:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
----------------------------------------------------
<S> <C> <C> <C> <C>
BNY Hamilton Equity Income
Fund
- Institutional Shares... $ 9 $ 28 $48 $108
- Investor Shares........ $12 $ 36 $62 $137
BNY Hamilton Large Cap
Growth Fund
- Institutional Shares... $ 8 $ 26 $46 $102
- Investor Shares........ $11 $ 34 $59 $131
BNY Hamilton Small Cap
Growth Fund
- Institutional Shares... $10 $ 31 $54 $119
- Investor Shares........ $13 $ 39 $67 $148
BNY Hamilton International
Equity Fund
- Institutional Shares... $13 $ 41 $70 $154
- Investor Shares........ $16 $ 48 $83 $182
</TABLE>
This table is designed to assist investors in understanding the various direct
and indirect costs that an investor would bear. Long-term shareholders of
Investor Shares of any of the Funds may pay more than the economic equivalent of
a maximum front-end sales load imposed on purchases permitted by the National
Association of Securities Dealers, Inc. The Adviser (as defined in 'Management
of the Funds') has agreed to limit expenses of BNY Hamilton Large Cap Growth
Fund to .82% and 1.07% of its average daily net assets of its Institutional
Shares and Investor Shares, respectively. Were expenses not so limited,
Management Fees would be .80% for both classes of shares, 12b-1 fees would be
.25% for the Investor Shares, and Total Fund Operating Expenses would be .88%
and 1.16% for the Institutional Shares and Investor Shares, respectively.
The Adviser has agreed to limit expenses of BNY Hamilton Small Cap Growth
Fund to .97% and 1.22% if its average daily net assets of its Institutional
Shares and Investor Shares, respectively. Were expenses not so limited,
Management Fees would be .95% for both classes of
(3) PROSPECTUS
<PAGE>
shares, 12b-1 fees would be .25% for the Investor Shares, and Total Fund
Operating Expenses would be 1.10% and 1.40% for the Institutional Shares and
Investor Shares, respectively.
The Adviser has agreed to limit expenses of BNY Hamilton International
Equity Fund to 1.27% and 1.52% of its average daily net assets of its
Institutional Shares and Investor Shares, respectively. Were expenses not so
limited, Management Fees would be 1.05% for both classes of shares, 12b-1 fees
would be .25% for the Investor Shares, and Total Fund Operating Expenses would
be 1.49% and 1.75% for the Institutional Shares and Investor Shares,
respectively.
Expenses are not limited by the Adviser for BNY Hamilton Equity Income
Fund. Management reserves the right to implement or discontinue expense
limitations at any time. See 'Fund and Other Shareholder Services--Fee Waivers'.
For a description of contractual fee arrangements or the fees and expenses
included in Other Expenses, see Management of the Funds and Fund and Other
Shareholder Services. In connection with the example, please note that $1,000 is
less than the generally applicable minimum initial investment required for each
of the Funds and that there are no redemption or exchange fees of any kind. See
'Purchase of Shares' and 'Redemption of Shares'.
THE EXAMPLE IS HYPOTHETICAL; IT IS INCLUDED SOLELY FOR ILLUSTRATIVE
PURPOSES. IT SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
PERFORMANCE; ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. EXPENSES PAID
AS SHOWN ABOVE REFLECT ESTIMATES MADE BY THE FUNDS AS OF THE DATE OF THIS
PROSPECTUS.
PROSPECTUS (4)
<PAGE>
FINANCIAL
HIGHLIGHTS
The following selected financial data for shares of BNY Hamilton Equity Income
Fund was audited by KPMG Peat Marwick LLP, independent accountants for the year
ended December 31, 1997, and by Deloitte & Touche LLP, independent accountants,
for all other periods presented, whose reports thereon appear in the Fund's
annual reports. This information should be read in conjunction with the
financial statements and related notes that also appear in the Fund's Annual
Report dated December 31, 1997 which is incorporated by reference into the
Statement of Additional Information.
BNY HAMILTON EQUITY INCOME FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL
SHARES INVESTOR SHARES
-------------- ----------------------------------------------------------------------------
FOR THE PERIOD FOR THE PERIOD
APRIL 1, 1997* AUGUST 10, 1992*
THROUGH YEAR ENDED DECEMBER 31, THROUGH
DECEMBER 31, --------------------------------------------------------- DECEMBER 31,
1997 1997 1996 1995 1994 1993 1992
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at
beginning of
period.............. $ 14.21 $ 14.12 $ 12.99 $ 10.70 $ 11.30 $ 10.43 $ 10.00
---------------------------------------------------------------------------------------------
INCOME FROM
INVESTMENT
OPERATIONS
Net investment
income.............. 0.25 0.35 0.30 0.32 0.31 0.29 0.11
Net realized and
unrealized gain
(loss) on
investments......... 3.25 3.27 2.22 2.41 (0.60) 0.94 0.47
---------------------------------------------------------------------------------------------
Total from
investment
operations........ 3.50 3.62 2.52 2.73 (0.29) 1.23 0.58
---------------------------------------------------------------------------------------------
DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income... (0.24) (0.28) (0.29) (0.32) (0.31) (0.28) (0.12)
Distributions from
capital gains....... (1.93) (1.93) (1.10) (0.12) -- (0.08) (0.03)
---------------------------------------------------------------------------------------------
Total dividends and
distributions..... (2.17) (2.21) (1.39) (0.44) (0.31) (0.36) (0.15)
---------------------------------------------------------------------------------------------
Net asset value at
end of period....... $ 15.54 $ 15.53 $ 14.12 $ 12.99 $ 10.70 $ 11.30 $ 10.43
---------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------
TOTAL RETURN:+....... 24.73** 25.85% 19.58% 25.78% (2.58)% 11.94% 5.86%**
RATIOS/SUPPLEMENTAL
DATA:
Net assets at end of
period (000's
omitted)............ $522,524 $ 34,213 $216,363 $169,841 $135,131 $112,849 $ 20,440
Ratio to average net
assets of:
Expenses, net of
waiver from The
Bank of New
York.............. 0.87%*** 1.01% 0.97% 1.00% 1.04% 1.09% 1.10%***
Expenses, prior to
waiver from The
Bank of New
York.............. 0.87%*** 1.01% 0.97% 1.00% 1.04% 1.12% 2.12%***
Net investment
income, net of
waiver from the
Bank of New
York.............. 2.07%*** 1.77% 2.17% 2.66% 2.89% 2.82% 3.33%***
Portfolio turnover
rate................ 65% 65% 58% 58% 51% 50% 25%
Average commission
rate paid per share
traded++............ $ 0.0622 $ 0.0622 $ 0.0622 $ 0.0557 -- -- --
</TABLE>
- ------------------------------
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
+ Total return does not consider the effect of the sales load for those periods
which the sales load was in effect.
++ For the fiscal years beginning on or after September 1, 1995, a Fund is
required to disclose its average commission rate per share for trades on
which commissions are charged.
Further information about the performance of BNY Hamilton Equity Income Fund is
contained in the Fund's annual report to shareholders, which may be obtained
from the distributor, BNY Hamilton Distributors, Inc. upon request and without
charge.
(5) PROSPECTUS
<PAGE>
The following selected financial data for shares of BNY Hamilton Large Cap
Growth Fund was audited by KPMG Peat Marwick LLP, independent accountants,
whose report thereon appears in the Fund's annual report. This information
should be read in conjunction with the financial statements and related notes
that also appear in the Fund's Annual Report dated December 31, 1997 which is
incorporated by reference into the Statement of Additional Information.
BNY HAMILTON LARGE CAP GROWTH FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL INVESTOR
SHARES SHARES
-------------- --------------
FOR THE PERIOD FOR THE PERIOD
APRIL 1, 1997* MAY 1, 1997*
THROUGH THROUGH
DECEMBER 31, DECEMBER 31,
1997 1997
-------------- --------------
-------------------------------
<S> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.......... $ 10.00 $ 10.70
-------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income........................... 0.08 0.06
Net realized and unrealized gain on
investments................................... 2.83 2.12
-------------------------------
Total from investment operations.............. 2.91 2.18
-------------------------------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income............ (0.08) (0.07)
Distributions from capital gains................ (1.89) (1.89)
-------------------------------
Total dividends and distributions............. (1.97) (1.96)
-------------------------------
Net asset value at end of period................ $ 10.94 $ 10.92
-------------------------------
-------------------------------
TOTAL RETURN:................................... 29.11%** 20.37%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's omitted)..... $373,326 $ 6,464
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New
York........................................ 0.82%*** 1.07%***
Expenses, prior to waiver from The Bank of New
York........................................ 0.88%*** 1.16%***
Net investment income, net of waiver from The
Bank of New York............................ 0.89%*** 0.54%***
Portfolio turnover rate......................... 37% 37%
Average commission rate paid per share traded... $ 0.0630 $ 0.0630
</TABLE>
- ------------------------------
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Large Cap Growth Fund
is contained in the Fund's annual report to shareholders, which may be obtained
from the distributor, BNY Hamilton Distributors, Inc., upon request and without
charge.
PROSPECTUS (6)
<PAGE>
The following selected financial data for shares of BNY Hamilton Small Cap
Growth Fund was audited by KPMG Peat Marwick LLP, independent accountants, whose
report thereon appears in the Fund's annual report. This information should be
read in conjunction with the financial statements and related notes that also
appear in the Fund's Annual Report dated December 31, 1997 which is incorporated
by reference into the Statement of Additional Information.
BNY HAMILTON SMALL CAP GROWTH FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL INVESTOR
SHARES SHARES
-------------- --------------
FOR THE PERIOD FOR THE PERIOD
APRIL 1, 1997* MAY 1, 1997*
THROUGH THROUGH
DECEMBER 31, DECEMBER 31,
1997 1997
--------------------------------
<S> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period......... $ 10.00 $ 10.03
--------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment loss............................ (0.02) (0.02)
Net realized and unrealized gain on
investments.................................. 2.80 2.78
--------------------------------
Total from investment operations............. 2.78 2.76
--------------------------------
DISTRIBUTIONS
Distributions from capital gains............... (0.85) (0.85)
--------------------------------
Net asset value at end of period............... $ 11.93 $ 11.94
--------------------------------
--------------------------------
TOTAL RETURN:.................................. 27.80%** 27.52%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's omitted).... $133,741 $ 1,162
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New
York....................................... 0.97%*** 1.22%***
Expenses, prior to waiver from The Bank of
New York................................... 1.10%*** 1.40%***
Net investment loss, net of waiver from the
Bank of New York........................... (0.26)%*** (0.54)%***
Portfolio turnover rate........................ 68% 68%
Average commission rate paid per share traded.. $ 0.0531 $ 0.0531
</TABLE>
- ------------------------------
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Small Cap Growth Fund
is contained in the Fund's annual report to shareholders, which may be obtained
from the distributor, BNY Hamilton Distributors, Inc., upon request and without
charge.
(7) PROSPECTUS
<PAGE>
The following selected financial data for shares of BNY Hamilton
International Equity Fund was audited by KPMG Peat Marwick LLP, independent
accountants, whose report thereon appears in the Fund's annual report. This
information should be read in conjunction with the financial statements and
related notes that also appear in the Fund's Annual Report dated December 31,
1997 which is incorporated by reference into the Statement of Additional
Information.
BNY HAMILTON INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL INVESTOR
SHARES SHARES
-------------- --------------
FOR THE PERIOD FOR THE PERIOD
APRIL 1, 1997* MAY 1, 1997*
THROUGH THROUGH
DECEMBER 31, DECEMBER 31,
1997 1997
-------------- --------------
<S> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period........... $ 10.00 $ 10.19
------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................ 0.02 0.02
Net realized and unrealized gain on investments
and foreign currency transactions.............. 0.67 0.45
------------------------------
Total from investment operations............... 0.69 0.47
------------------------------
Net asset value at end of period................. $ 10.69 $ 10.66
------------------------------
------------------------------
TOTAL RETURN:.................................... 6.90%** 4.61%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's omitted)...... $ 94,806 $ 2,560
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New
York......................................... 1.26%*** 1.52%***
Expenses, prior to waiver from The Bank of New
York......................................... 1.49%*** 1.75%***
Net investment income, net of waiver from the
Bank of New York............................. 0.26%*** 0.33%***
Portfolio turnover rate.......................... 36% 36%
Average commission rate paid per share traded.... $ 0.0301 $ 0.0301
</TABLE>
- ------------------------------
* Commencement of investment operations.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton International Equity
Fund is contained in the Fund's annual report to shareholders, which may be
obtained from the distributor, BNY Hamilton Distributors, Inc., upon request and
without charge.
PROSPECTUS (8)
<PAGE>
INVESTMENT OBJECTIVES
AND POLICIES
The investment objective of each of the Funds is described below, together with
the policies each Fund will employ in its efforts to achieve its objective.
There can be no assurance that the Funds will attain their respective investment
objectives.
INTRODUCTION
The Funds are open-end management investment companies (commonly known as mutual
funds) registered under the Investment Company Act of 1940 (the '1940 Act').
Each of the Funds will be considered a separate pool of assets with its own
distinctive investment objectives and policies, as described below.
BNY HAMILTON EQUITY INCOME FUND
(THE 'EQUITY INCOME FUND')
The Equity Income Fund's investment objective is to provide long-term capital
appreciation greater than the appreciation of, and yield greater than the yield
of, the Standard & Poor's 500 Index. Equal emphasis is placed on attaining
income and capital appreciation. The Equity Income Fund will invest primarily in
common stock and convertible securities issued by domestic corporations, and may
also invest in securities issued by foreign corporations. In connection with its
investment objectives, the Equity Income Fund seeks to achieve capital
appreciation in excess of the market average represented by the Standard &
Poor's 500 Index. During periods of rapid market capital appreciation, the
effect of the Equity Income Fund's dual investment objectives will likely be
that its net asset value will not rise as rapidly as the market generally.
Conversely, during periods of rapid market depreciation, the Equity Income
Fund's net asset value would not be expected to decline as rapidly as the
market.
The Equity Income Fund will invest in common stocks and securities
convertible into common stocks. The securities in which the Equity Income Fund
may invest include those listed on any domestic or foreign securities exchange
or traded in the over-the-counter market. Under normal circumstances, the Equity
Income Fund intends to invest at least 65% of the value of its total assets in
equity-related securities (such as preferred stock or corporate debt that is
convertible to common stocks) that pay dividends or interest.
BNY HAMILTON LARGE CAP GROWTH FUND
(THE 'LARGE CAP GROWTH FUND')
The Large Cap Growth Fund's investment objective is to provide long-term capital
appreciation by investing primarily in common stocks and securities convertible
into common stocks of domestic and foreign corporations; current income is a
secondary consideration. However, during times of adverse market and/or economic
conditions, the Large Cap Growth Fund may invest in securities with a high
enough yield to offer possible resistance to downward market and/or economic
pressure. In selecting securities for the Large Cap Growth Fund, a focus will be
(9) PROSPECTUS
<PAGE>
given to securities of corporations perceived to have a relatively high
potential for growth of earnings and/or revenues. The Fund currently
considers large cap corporations to be those with market capitalization of $3
billion or greater. In normal circumstances the Large Cap Growth Fund will
invest at least 65% of the value of its total assets in such equity securities.
BNY HAMILTON SMALL CAP GROWTH FUND
(THE 'SMALL CAP GROWTH FUND')
The Small Cap Growth Fund's investment objective is to provide long-term capital
appreciation by investing primarily in equity securities of small domestic and
foreign corporations. In selecting securities for the Small Cap Growth Fund, a
focus will be given to securities of corporations perceived as having potential
for rapid growth in earnings or revenues due to expanded operations, new
products, new technologies, new channels of distribution, revitalized
management, general industry condition or other similar advantageous
circumstances. Current income will not be a consideration. The Fund currently
considers small corporations to be those with market capitalization of $1.5
billion or less. In normal circumstances the Small Cap Growth Fund will invest
at least 65% of the value of its total assets in such equity securities.
BNY HAMILTON INTERNATIONAL EQUITY FUND
(THE 'INTERNATIONAL EQUITY FUND')
The International Equity Fund's investment objective is to provide long-term
capital appreciation through investing primarily in equity securities of
non-U.S. issuers. In normal circumstances, the International Equity Fund may
invest in securities principally traded in countries outside the United States.
Additionally, the International Equity Fund may at any time include American
Depositary Receipts, which are United States securities representing foreign
securities that are deposited with foreign custodians or foreign branches of
U.S. commercial banks; they trade in U.S. dollars on listed exchanges and
over-the-counter markets. At any given time the International Equity Fund may
invest up to 50% of its assets in securities principally traded in any one
country, although it will ordinarily invest at least 65% of its total assets in
at least three (3) countries.
DESCRIPTION
OF SECURITIES
EQUITY SECURITIES
Each of the Funds may invest in common stocks, which includes the common stock
of any class or series of domestic or foreign corporations (foreign corporations
only in the case of the International Equity Fund) or any similar equity
interest, such as a trust or partnership interest. These investments may or may
not pay dividends and may or may not carry voting rights. Common stock occupies
the most junior position in a company's capital structure.
PROSPECTUS (10)
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CONVERTIBLE SECURITIES
The Funds may invest in convertible securities, which include any debt
securities or preferred stock that may be converted into common stock or that
carry the right to purchase common stock. Convertible securities entitle the
holder to exchange the securities for a specified number of shares of common
stock, usually of the same company, at specified prices within a certain period
of time. They also entitle the holder to receive interest or dividends until the
holder elects to exercise the conversion privilege.
The terms of any convertible security determine its ranking in a company's
capital structure. In the case of subordinated convertible debentures, the
holders' claim on assets and earnings are generally subordinate to the claims of
other creditors, and senior to the claims of preferred and common stockholders.
In the case of convertible preferred stock, the holder's claims on assets and
earnings are subordinate to the claims of all creditors and are senior to the
claims of common stockholders. As a result of their ranking in a company's
capitalization, convertible securities that are rated by nationally recognized
securities rating organizations are generally rated below other securities of
the company and many convertible securities are not rated. The Funds do not have
any rating criteria applicable to their investments in any securities,
convertible or otherwise.
FOREIGN EQUITY INVESTMENTS
The International Equity Fund will, and the Equity Income Fund, the Large Cap
Growth Fund and the Small Cap Growth Fund may, invest in the securities of
foreign issuers. The Equity Income Fund, the Large Cap Growth Fund and the Small
Cap Growth Fund do not expect more than 15% of their foreign investments to be
in securities that are not listed on a securities exchange or, in the case of
debt securities, that are not United States dollar-denominated. Foreign
investments may be made directly in securities of foreign issuers or in the form
of American Depositary Receipts ('ADRs') and Global Depositary Receipts
('GDRs'). Generally, ADRs and GDRs are receipts issued by a bank or trust
company that evidence ownership of underlying securities issued by a foreign
corporation and that are designed for use in the domestic, in the case of ADRs,
or global, in the case of GDRs, securities markets. The Funds expect to only
invest in ADRs and GDRs which are initiated and maintained by the issuers of the
underlying securities (so-called 'sponsored' ADRs and GDRs).
Since investments in foreign securities may involve foreign currencies, the
value of a Fund's assets as measured in United States dollars may be affected by
changes in currency rates and in exchange control regulations, including
currency blockage. The Funds may enter into forward commitments for the purchase
or sale of foreign currencies to close out or offset existing foreign securities
positions or to hedge the underlying currency exposure related to foreign
investments, but the Funds will not enter into such commitments for speculative
purposes. In addition, to the extent that a Fund invests in foreign commercial
paper, the paper must not be subject to foreign withholding tax at the time of
purchase.
For a description of additional risks associated with investing in foreign
securities, see 'Additional Investment Information and Risk
Considerations--Foreign Investment Risk'.
(11) PROSPECTUS
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ADDITIONAL INVESTMENT
INFORMATION AND
RISK CONSIDERATIONS
The following paragraphs describe other types of securities transactions in
which the Funds may engage. Generally, the following types of securities and
transactions involve more risk than those discussed above in 'Description of
Securities'.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
Each of the Funds may purchase securities on a when-issued or delayed delivery
basis. Delivery of and payment for these securities may take as long as a month
or more after the date of the purchase commitment. The value of these securities
is subject to market fluctuation during this period and no interest or income
accrues to a Fund until settlement. Each Fund will maintain with its custodian a
separate account with a segregated portfolio of liquid assets consisting of
cash, U.S. Government securities or other liquid high-grade debt securities in
an amount at least equal to these commitments. When entering into a when-issued
or delayed delivery transaction, a Fund will rely on the other party to
consummate the transaction; if the other party fails to do so, the Fund may be
disadvantaged. It is the current policy of each of the Funds not to enter into
when-issued commitments exceeding in the aggregate 25% of the market value of
the Fund's total assets less liabilities other than the obligations created by
these commitments.
REPURCHASE AGREEMENTS
Each of the Funds may enter into repurchase agreements with brokers, dealers or
banks that meet the credit guidelines established by the Board of Directors (the
'Directors') of BNY Hamilton Funds, Inc. In a repurchase agreement, a Fund buys
a security from a seller that has agreed to repurchase it at a mutually agreed
upon date and at a price reflecting the interest rate effective for the term of
the agreement. The term of these agreements is usually from overnight to one
week. A repurchase agreement may be viewed as a fully collateralized loan of
money by a Fund to the seller. A Fund always receives, as collateral, securities
with a market value at least equal to purchase price plus accrued interest and
this value is maintained during the term of the agreement. If the seller
defaults and the collateral value declines, a Fund might incur a loss. If
bankruptcy proceedings are commenced with respect to the seller, a Fund's
realization upon the collateral may be delayed or limited. Investments in
certain repurchase agreements and certain other investments that may be
considered illiquid are limited as set forth under 'Investment Restrictions'.
LOANS OF PORTFOLIO SECURITIES
Subject to applicable investment restrictions, each Fund is permitted to lend
its securities. These loans must be secured continuously by cash, U.S.
Government securities or other liquid high-grade short-term obligations in an
account segregated by the custodian or by a letter of credit at least equal to
the market value of the securities loaned plus accrued interest or income. For
more information, see 'Investment Objectives and Policies--Loans of Portfolio
Securities' in the Statement of Additional Information.
PROSPECTUS (12)
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REVERSE REPURCHASE AGREEMENTS
Each of the Funds is permitted to enter into reverse repurchase agreements. In a
reverse repurchase agreement, a Fund sells a security and agrees to repurchase
it at a mutually agreed upon date and at a price reflecting the interest rate
effective for the term of the agreement. This may also be viewed as the
borrowing of money by a Fund. A Fund will not invest the proceeds of a reverse
repurchase agreement for a period which exceeds the duration of the reverse
repurchase agreement. A Fund may not enter into reverse repurchase agreements
exceeding in the aggregate one-third of the market value of its total assets,
less liabilities other than the obligations created by reverse repurchase
agreements. Each Fund will establish and maintain with its custodian a separate
account with a segregated portfolio of liquid assets consisting of cash, U.S.
Government securities or other liquid high-grade debt securities in an amount at
least equal to its purchase obligations under its repurchase agreements.
Reverse repurchase agreements involve the risk that the market value of the
securities retained by a Fund may decline below the price of the securities it
has sold but is obligated to repurchase under the agreement. In the event the
buyer of securities under a reverse repurchase agreement files for bankruptcy or
becomes insolvent, a Fund's use of proceeds from the agreement may be restricted
pending a determination by the other party or its trustee or receiver whether to
enforce a Fund's obligation to repurchase the securities.
INVESTMENT COMPANY SECURITIES
The Funds may invest in the securities of other investment companies to the
extent permitted under the 1940 Act. These limits require that, as determined
immediately after a purchase is made, (i) not more than 5% of the value of a
Fund's total assets will be invested in the securities of any one investment
company, (ii) not more than 10% of the value of such Fund's total assets will be
invested in the aggregate in securities of investment companies as a group, and
(iii) not more than 3% of the outstanding voting stock of any one investment
company will be owned by such Fund. As a shareholder of another investment
company, a Fund would bear, along with other shareholders, its pro rata portion
of the other investment company's expenses, including advisory fees. These
expenses would be in addition to the advisory and other expenses that such Fund
bears directly in connection with its own operations.
PRIVATELY PLACED AND CERTAIN UNREGISTERED SECURITIES
Each of the Funds may acquire, in privately negotiated transactions, restricted
securities that cannot be offered for public sale in the United States without
first being registered under the Securities Act of 1933, as amended (the
'Securities Act'). The price a Fund pays for these securities, or receives upon
resale, may be lower than the price the Fund would pay or receive for similar
securities with a more liquid market. Accordingly, the valuation of these
securities by a Fund will reflect any limitations on their liquidity. Each of
the Funds may also purchase certain unregistered securities sold to
institutional investors under Rule 144A of the Securities Act ('Rule 144A
Securities'). Rule 144A Securities that have a readily available market may be
deemed to be liquid for purposes of each Fund's 15% limitation on investments in
illiquid securities. The Funds' Adviser will monitor the liquidity of such
restricted securities under the supervision of, and pursuant to guidelines
established by, the Directors. In establishing
(13) PROSPECTUS
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these guidelines, the Directors will take into account factors such as
trading activity, availability of reliable price information and other
relevant information. Investing in Rule 144A Securities could have the effect
of increasing the level of a Fund's illiquidity to the extent that qualified
institutional buyers become, for a time, uninterested in purchasing these
securities. Acquisition by a Fund of illiquid investments (any investment that
cannot be disposed of within three (3) Business Days in the normal course of
business at approximately the amount at which it was valued by a Fund) is
subject to the 15% limitation described under 'Investment Restrictions'.
HEDGING
Hedging is a means of transferring risk that an investor does not wish to assume
during an uncertain market environment. The Funds are permitted to enter into
these transactions solely (a) to hedge against changes in the market value of
portfolio securities and against changes in the market value of securities
intended to be purchased or (b) to close out or offset existing positions.
Hedging activity in the Funds may include selling futures contracts on
stock indexes, options on stock index futures traded on a national exchange or
board of trade and options on securities and on stock indexes traded on national
securities exchanges or through private transactions directly with a
broker-dealer. A Fund may also hedge a portion of its portfolio by selling stock
index futures contracts or purchasing puts on these contracts to limit exposure
to an actual or anticipated market decline. All hedging transactions must be
appropriate for reduction of risk; they cannot be for speculation.
Under regulations of the Commodity Exchange Act of 1936, as amended (the
'Commodity Exchange Act'), an investment company registered under the 1940 Act
is exempt from the definition of 'commodity pool operator', and therefore not
subject to regulation under the Commodity Exchange Act, provided that the entity
agrees to restrict its investments in commodity futures and commodity options
contracts to (i) bona fide hedging transactions within the meaning of the
Commodity Futures Trading Commission's regulations, without any limitation on
quantity, and (ii) other futures and options transactions in which the aggregate
initial margin and premiums do not exceed 5% of the liquidation value of the
entity's portfolio after taking into account unrealized profits and unrealized
losses on any such contracts. The Funds will only use commodity futures and
commodity options contracts in a manner consistent with these requirements.
STOCK INDEX FUTURES
A Fund may purchase and sell stock index futures contracts as a hedge against
changes resulting from market conditions in the values of securities that are
held in its portfolio or that it intends to purchase or when such purchase or
sale is economically appropriate for the reduction of risks inherent in the
ongoing management of a Fund. A stock index futures contract is an agreement in
which one party agrees to deliver to the other 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
PROSPECTUS (14)
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trading day of the contract and the price at which the agreement is made. When
the contract is executed, each party deposits with a broker or in a segregated
custodial account a specified percentage of the contract amount, called the
initial margin, and during the term of the contract, the amount of the deposit
is adjusted based on the current value of the futures contract by payments of
variation margin to or from the broker or segregated account. In the case of
options on stock index futures, the holder of the option pays a premium and
receives the right, upon exercise of the option at a specified price during the
option period, to assume the option writer's position in a stock index futures
margin account; if exercised on the last trading day, cash in an amount equal to
the difference between the option exercise price and the closing level of the
relevant index on the expiration date is delivered.
A Fund may hedge a portion of its portfolio by selling stock index futures
contracts or purchasing puts on these contracts to limit exposure to an actual
or anticipated market decline. This provides an alternative to liquidation of
securities positions. Conversely, during a market advance or when the investment
adviser anticipates an advance, a Fund may hedge a portion of its portfolio by
purchasing stock index futures, or options on these futures. This affords a
hedge against a Fund's not participating in a market advance when it is not
fully invested and serves as a temporary substitute for the purchase of
individual securities which may later be purchased in a more advantageous
manner.
None of the Funds will sell stock index futures unless the amount resulting
from the multiplication of the then current level of the indexes upon which a
particular Fund's futures contracts are based by the number of futures contracts
which would be outstanding does not exceed one-third of the value of its net
assets. Also, a Fund may not purchase or sell stock index futures or purchase
options on futures if, immediately thereafter, the sum of the amount of margin
deposits on its existing futures positions and premiums paid for such options
would exceed 5% of the market value of its total assets. When a Fund purchases
stock index futures contracts, it will deposit an amount of liquid assets
consisting of cash, U.S. Government securities or other liquid high-grade debt
securities equal to the market value of the futures contracts in a segregated
account with its custodian.
A Fund's successful use of stock index futures contracts depends upon the
investment adviser's ability to predict the direction of the market and is
subject to various additional risks. The correlation between movement in the
price of the stock index future and the price of the securities being hedged is
imperfect and the risk from imperfect correlation increases as the composition
of a Fund's portfolio diverges from the composition of the relevant index. In
addition, if a Fund purchases futures to hedge against market advances before it
can invest in common stock in an advantageous manner and the market declines,
there may be a loss on the futures contracts. In addition, the ability of a Fund
to close out a futures position or an option on futures depends on a liquid
secondary market. There is no assurance that liquid secondary markets will exist
for any particular futures contract or option on a futures contract at any
particular time. The risk of loss to a Fund is theoretically unlimited when a
Fund sells an uncovered futures contract because there is an obligation to make
delivery unless the contract is closed out, regardless of fluctuations in the
price of the underlying security. A
(15) PROSPECTUS
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Fund's ability to engage in hedging activities may be limited by certain
federal income tax considerations. See 'Taxes' in the Statement of Additional
Information.
OPTIONS ON SECURITIES
A Fund may purchase put options only on equity securities held in its portfolio
and write call options and put options on stocks only if they are covered, as
described below, and such call options must remain covered so long as the
relevant Fund is obligated as a writer. Option transactions can be executed
either on a national exchange or through a private transaction with a
broker-dealer (an 'over-the-counter' transaction). The Funds do not presently
intend to purchase put options and write call options on stocks that are not
traded on national securities exchanges or listed on the Nasdaq National
Market(Registered). Put options purchased and call options written by a Fund are
considered to be illiquid securities as they may be difficult to convert into
cash during volatile market conditions.
A Fund may, from time to time, write call options on its portfolio
securities. A Fund may only write call options that are 'covered,' meaning that
it either owns the underlying security or has an absolute and immediate right to
acquire that security, without additional cash consideration (or for additional
cash consideration held in a segregated account by its custodian), upon
conversion or exchange of other securities currently held in its portfolio. In
addition, a Fund will not permit the call to become uncovered prior to the
expiration of the option or termination through a closing purchase transaction
as described below. If a Fund writes a call option, the purchaser of the option
has the right to buy (and the Fund has the obligation to sell) the underlying
security at the exercise price throughout the term of the option. The initial
amount paid to a Fund by the purchaser of the option is the 'premium'. A Fund's
obligation to deliver the underlying security against payment of the exercise
price will terminate either upon expiration of the option or earlier if a Fund
is able to effect a 'closing purchase transaction' through the purchase of an
equivalent option. There can be no assurance that a closing purchase transaction
can be effected at any particular time or at all. A Fund would not be able to
effect a closing purchase transaction after it had received notice of exercise.
In order to write a call option, a Fund is required to comply with the
rules of The Options Clearing Corporation and the various exchanges with respect
to collateral requirements. A Fund may not purchase call options on individual
stocks except in connection with a closing purchase transaction. It is possible
that the cost of effecting a closing transaction may be greater than the premium
received by a Fund for writing the option.
The Funds may also purchase put options so long as they are listed on an
exchange. If a Fund purchases a put option, it has the option to sell the
subject security at a specified price at any time during the term of the option.
Purchasing put options may be used as a portfolio investment strategy when
the investment adviser perceives significant short-term risk but substantial
long-term appreciation for the underlying security. The put option acts as an
insurance policy, as it protects against significant downward price movement
while it allows full participation in any upward movement. If a Fund is holding
a stock that the investment adviser feels has strong
PROSPECTUS (16)
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fundamentals, but for some reason may be weak in the near term, it may purchase
a listed put on such security, thereby giving itself the right to sell such
security at a certain strike price throughout the term of the option.
Consequently, a Fund will exercise the put only if the price of such security
falls below the strike price of the put. The difference between the put's strike
price and the market price of the underlying security on the date a Fund
exercises the put, less transaction costs, will be the amount by which a Fund
will be able to hedge against a decline in the underlying security. If during
the period of the option the market price for the underlying security remains at
or above the put's strike price, the put will expire worthless, representing a
loss of the price a Fund paid for the put, plus transaction costs. If the price
of the underlying security increases, the profit a Fund realizes on the sale of
the security will be reduced by the premium paid for the put option less any
amount for which the put may be sold.
Each Fund may write put options on a fully covered basis on a stock the
Fund intends to purchase. If a Fund writes a put option, the purchaser of the
option has the right to sell (and the Fund has the obligation to buy) the
underlying security at the exercise price throughout the term of the option. The
initial amount paid to a Fund by the purchaser of the option is the 'premium'. A
Fund's obligation to purchase the underlying security against payment of the
exercise price will terminate either upon expiration of the option or earlier if
a Fund is able to effect a 'closing purchase transaction' through the purchase
of an equivalent option. There can be no assurance that a closing purchase
transaction can be effected at any particular time or at all. In all cases where
a put option is written, a Fund will segregate or put into escrow with its
custodian, or pledge to a broker as collateral any combination of 'qualified
securities' (which consists of cash, U.S. Government securities or other liquid
high-grade debt obligations) with a market value at the time the option is
written of not less than 100% of the exercise price of the put option multiplied
by the number of options contracts written times the option multiplier.
Each Fund may purchase a call option in a stock it intends to purchase at
some point in the future. The purchase of a call option is viewed as an
alternative to the purchase of the actual stock. The number of option contracts
purchased multiplied by the exercise price times the option multiplier will not
be any greater than the number of shares that would have been purchased had the
underlying security been purchased. If a Fund purchases a call option, it has
the right but not the obligation to purchase (and the seller has the obligation
to sell) the underlying security at the exercise price throughout the term of
the option. The initial amount paid by a Fund to the seller of the call option
is known as the 'premium'. If during the period of the option the market price
of the underlying security remains at or below the exercise price, the call
option will expire worthless, representing a loss of the price a Fund paid for
the call, plus transaction costs. If the underlying security decreases and is
below the exercise price, the Fund will be able to purchase the security at the
lower market price. The profit or loss a Fund may realize on the eventual sale
of a security purchased by means of the exercise of a call option will be
reduced by the premium paid for the call option.
STOCK INDEX OPTIONS
Except as described below, a Fund will write call options on indices only if on
such date it holds a portfolio of stocks at least equal to the value of the
index times the multiplier times the number of contracts. When a Fund writes a
call option on a broadly-based stock market index,
(17) PROSPECTUS
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it will segregate or put into escrow with its custodian, or pledge to a
broker as collateral for the option, any combination of 'qualified
securities' (which consists of cash, U.S. Government securities or other liquid
high-grade debt obligations) with a market value at the time the option is
written of not less than 100% of the current index value times the multiplier
times the number of contracts.
If a Fund has written an option on an industry or market segment index, it
will segregate or put into escrow with its custodian, or pledge to a broker as
collateral for the option, one or more 'qualified securities,' all of which are
stocks of issuers in such industry or market segment, with a market value at the
time the option is written of not less than 100% of the current index value
times the multiplier times the number of contracts.
If at the close of business on any Business Day the market value of such
qualified securities so segregated, escrowed, or pledged falls below 100% of the
current index value times the multiplier times the number of contracts, a Fund
will so segregate, escrow or pledge an amount in cash, Treasury bills or other
liquid high-grade, short-term debt obligations equal in value to the difference.
In addition, when a Fund writes a call on an index that is in-the-money at the
time the call is written, it will segregate with its custodian or pledge to the
broker as collateral cash, U.S. Government or other liquid high-grade,
short-term debt obligations equal in value to the amount by which the call is
in-the-money times the multiplier times the number of contracts. Any amount
segregated pursuant to the foregoing sentence may be applied to a Fund's
obligation to segregate additional amounts in the event that the market value of
the qualified securities falls below 100% of the current index value times the
multiplier times the number of contracts. However, if a Fund holds a call on the
same index as the call written where the exercise price of the call held is
equal to or less than the exercise price of the call written or greater than the
exercise price of the call written if the difference is maintained in cash,
short-term U.S. Government securities or other high-grade short-term obligations
in a segregated account with its custodian, it will not be subject to the
requirements described in this paragraph.
RISKS OF TRANSACTIONS IN STOCK OPTIONS
Purchase and sales of options involves the risk that there will be no market in
which to effect a closing transaction. An option position may be closed out only
on an exchange that provides a secondary market for an option of the same series
or if the transaction was an over-the-counter transaction, the original
broker-dealer. Although the Funds will generally buy and sell options for which
there appears to be an active secondary market, there is no assurance that a
liquid secondary market on an exchange will exist for any particular option, or
at any particular time, and for some options no secondary market on an exchange
may exist. If a Fund as a covered call or put option writer is unable to effect
a closing purchase transaction in a secondary market, it will not be able to
sell the underlying security until the option expires or it delivers or
purchases the underlying security upon exercise.
PROSPECTUS (18)
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RISKS OF OPTIONS ON INDEXES
A Fund's purchase and sale of options on indexes will be subject to risks
described above under 'Risks of Transactions in Stock Options'. In addition, the
distinctive characteristic of options on indexes create certain risks that are
not present with stock options.
Since the value of an index option depends upon movements in the level of
the index rather than the price of a particular stock, whether a Fund will
realize a gain or loss on the purchase or sale of an option on an index depends
upon movements in the level of stock prices in the stock market generally or in
an industry or market segment rather than movements in the price of a particular
stock. Accordingly, successful use by a Fund of options on indexes would be
subject to the investment adviser's ability to correctly predict movements in
the direction of the stock market generally or of a particular industry. This
requires different skills and techniques than predicting changes in the price of
individual stocks.
Index prices may be distorted if trading of certain stocks included in the
index is interrupted. Trading in the index options also may be interrupted in
certain circumstances, such as if trading were halted in a substantial number of
stocks included in the index. If this occurred, a Fund would not be able to
close out options that it had purchased or written and, if restrictions on
exercise were imposed, might not be able to exercise an option that it was
holding, which could result in substantial losses to the Fund. It is the Funds'
policy to purchase or write options only on indexes that include a number of
stocks sufficient to minimize the likelihood of a trading halt in the index, for
example, the S&P 100 or S&P 500 index option.
Trading in index options commenced in April 1983 with the S&P 100 option
(formerly called the CBOE 100). Since that time, a number of additional index
option contracts have been introduced including options on industry indexes.
Although the markets for certain index option contracts have developed rapidly,
the markets for other index options are still relatively illiquid. The ability
to establish and close out positions on such options will be subject to the
development and maintenance of a liquid secondary market. It is not certain that
this market will develop in all index option contracts. The Funds will not
purchase or sell index option contracts unless and until, in the investment
adviser's opinion, the market for such options has developed sufficiently that
the risk in connection with these transactions is no greater than the risk in
connection with options on stock.
For further information about the Funds' hedging activities, see
'Investment Objectives and Policies--Hedging Activities' in the Statement of
Additional Information.
FOREIGN INVESTMENT RISK
The International Equity Fund will, and the Equity Income Fund, the Large Cap
Growth Fund, and the Small Cap Growth Fund may invest in certain foreign
securities. Investment in obligations of foreign issuers and in foreign branches
of domestic banks involves somewhat different investment risks from those
affecting obligations of United States domestic issuers. There may be limited
publicly available information with respect to foreign issuers, and foreign
issuers are not generally subject to uniform accounting, auditing and financial
standards and requirements comparable to those applicable to domestic companies.
There may also be less government supervision and regulation of foreign
securities exchanges, brokers and issuers than
(19) PROSPECTUS
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in the United States. Foreign securities markets have substantially less
volume than domestic securities exchanges, and securities of some foreign
issuers are less liquid and more volatile than securities of comparable
domestic issuers. Brokerage commissions and other transaction costs on foreign
securities exchanges are generally higher than in the United States. Dividends
paid by foreign issuers may be subject to withholding and other foreign taxes
that may decrease the net return on foreign investments as compared to dividends
and interest paid to a Fund by domestic companies. Additional risks include
future political and economic developments, the possibility that a foreign
jurisdiction might impose or change withholding taxes on income payable with
respect to foreign securities, the possible seizure, nationalization or
expropriation of the foreign issuer or foreign deposits and the possible
adoption of foreign governmental restrictions such as exchange controls. Since
investments in foreign securities involve foreign currencies, the value of their
assets measured in United States dollars may be affected by changes in currency
rates and in exchange control regulations, including currency blockage.
HIGH YIELD/HIGH RISK BONDS (COMMONLY KNOWN AS 'JUNK BONDS')
Since the Funds have no pre-established minimum quality standards, a portion of
the securities, particularly high-yield/high-risk securities, may be subject to
additional risk. Corporate debt securities that are below investment grade
(securities rated Ba or lower by Moody's Investor Services or BB or lower by
Standard & Poor's Corporation) and unrated securities, which a Fund may purchase
and hold, are subject to higher risk of non-payment of principal or interest, or
both, than higher grade debt securities. This greater degree of risk generally
offers higher potential yields. Although the Funds may invest in unrated
convertible debt securities, the investment adviser will not ordinarily invest
in securities that, in its judgment, would not be investment grade.
INVESTMENT
RESTRICTIONS
As a diversified series of a registered investment company, 75% of the value of
a Fund's assets must be limited such that (a) it does not consist of securities
of any one issuer with a value greater than 5% of the value of the total assets
of such Fund, except obligations of the United States Government and its
agencies and instrumentalities, and (b) it does not represent more than 10% of
the outstanding voting securities of any one issuer.
CERTAIN FUNDAMENTAL POLICIES
Each Fund also operates under certain investment restrictions that, together
with their investment objectives, are deemed fundamental policies--i.e., they
may be changed only with the approval of the holders of a majority of a Fund's
outstanding shares.
Each of the Funds may not: (i) acquire any illiquid securities if, as a
result, more than 15% of the market value of its net assets would be in
investments that are illiquid; (ii) enter into reverse repurchase agreements
exceeding one-third of the market value of its total assets, less certain
liabilities; (iii) borrow money, except from banks for extraordinary or
emergency purposes and then only in amounts up to 20% of the value of the
specific Fund's total assets (taken at cost at the time of borrowing) and except
in connection with permitted reverse
PROSPECTUS (20)
<PAGE>
repurchase agreements; or mortgage, pledge or hypothecate any assets except in
connection with any such borrowing in amounts up to 20% of the value of the
specific Fund's net assets at the time of borrowing; (iv) purchase securities
while borrowings, as described in clauses (ii) and (iii) above, exceed 5% of its
total assets or (v) invest more than 25% of its assets in securities of issuers
in any one industry.
For a more detailed discussion of the above investment restrictions,
including a description of applicability to each Fund, see 'Investment
Restrictions and Additional Information' in the Statement of Additional
Information.
MANAGEMENT
OF THE FUNDS
DIRECTORS
Pursuant to the Articles of Incorporation and Bylaws of BNY Hamilton Funds,
Inc., the Directors decide matters of general policy and review the actions of
the Funds' investment adviser, administrator, distributor and other service
providers. The Statement of Additional Information contains the name and general
business experience of each director of BNY Hamilton Funds, Inc.
INVESTMENT ADVISER
The Bank of New York serves as the investment adviser (the 'Adviser') to each of
the Funds. The Adviser, which has its principal offices at 48 Wall Street, New
York, NY 10286, is New York's first bank, founded by Alexander Hamilton in 1784,
and is one of the largest commercial banks in the United States, having over $60
billion in assets at December 31, 1997. It is the leading retail bank in the
greater New York suburban area, having 363 branches at December 31, 1997. As of
December 31, 1997, the Adviser provided administrative or advisory services to
approximately $42 billion in assets.
Robert G. Knott, Jr., Vice President, has been responsible for the
day-to-day portfolio management of the Equity Income Fund since its inception.
Mr. Knott has been employed by the Adviser for the past 30 years. Currently, he
is a Group Head of the Adviser's Personal Asset Management Division.
Charles C. Goodfellow, Vice President, is responsible for the day-to-day
portfolio management of the Large Cap Growth Fund. Mr. Goodfellow has been
managing common trust funds offered to the Adviser's institutional clients for
the past nine years. John C. Lui, Vice President, is responsible for the
day-to-day portfolio management of the Small Cap Growth Fund. Mr. Lui has been
employed by the Adviser for the past three years as an institutional equity
manager, and is responsible for managing various investments in equity
securities on behalf of the Adviser's institutional clients. From 1993 to 1995,
Mr. Lui was employed by Barclays Global Asset Management, where he managed
global equity and bond portfolios. For 13 years prior to 1993, Mr. Lui was
employed by the Adviser as a Group Head of its International Personal Asset
Management division. He was responsible for managing the assets of foreign high
net worth individuals, institutional investors, and Far Eastern clients in the
United States securities markets.
(21) PROSPECTUS
<PAGE>
Charles D. Ryan, Vice President, has been responsible for the day-to-day
portfolio management of the International Equity Fund since February 1998. He
has been employed by the Adviser since 1994. Prior to 1994, Mr. Ryan was a
portfolio manager at First Fidelity Bank, where he co-managed a commingled
growth trust fund valued at approximately $500 million. He was also a member of
First Fidelity Bank's stock selection committee. Mr. Ryan has over 9 years of
portfolio management experience.
The International Equity Fund is sub-advised by Indocam (the
'Sub-adviser'), a subsidiary of Banque Indosuez.
Eric Taze-Bernard, head of the Sub-adviser's research and strategy
department since 1993, is responsible for the day-to-day portfolio management of
the International Equity Fund. Prior to 1993, he was Deputy Head of the Economic
and Financial Research department of Banque Indosuez from 1987-1992.
The Adviser manages the investments of each Fund and is responsible for all
purchases and sales of each Fund's portfolio securities. The Adviser's fee
accrues daily and is payable monthly at the annual rate of .60%, .60%, .75% and
.85% of average daily net assets for Equity Income Fund, Large Cap Growth Fund,
Small Cap Growth Fund and International Equity Fund, respectively. The Adviser,
out of its own funds and not the assets of International Equity Fund, will pay
the Sub-adviser a fee equal to .425% of the average daily net assets of the
International Equity Fund.
ADMINISTRATOR
BNY Hamilton Distributors, Inc. ('BNY Hamilton Distributors') serves as the
Funds' administrator (the 'Administrator') and assists generally in supervising
the operations of each Fund. BNY Hamilton Distributors is a Delaware corporation
organized to administer and distribute mutual funds; its offices are located at
3435 Stelzer Road, Columbus, Ohio 43219-3035.
The Administrator has agreed to provide facilities, equipment and personnel
to carry out administrative services for the Funds, including, among other
things, providing the services of persons who may be appointed as officers and
directors of BNY Hamilton Funds, Inc., overseeing the performance of the Funds'
transfer agent, supervising purchase and redemption orders (made via telephone
and mail) and monitoring the Distributor's compliance with the rules and
regulations of the National Association of Securities Dealers and federal and
state securities laws. The Administrator will also be responsible for
coordinating and overseeing compliance by the Directors with Maryland corporate
procedural requirements (as BNY Hamilton Funds, Inc. is a Maryland corporation;
see 'Organization'). In addition, the Administrator's duties include assisting
in drafting and printing prospectuses and statements of additional information,
administering shareholder meetings, producing proxy statements and annual and
semi-annual reports, monitoring the Adviser's compliance with the stated
investment objective and restrictions of each Fund and monitoring the custodian,
fund
PROSPECTUS (22)
<PAGE>
accounting, transfer agency, administration, distribution, advisory and legal
services that are provided to the Funds.
The Administration Agreement permits the Administrator to delegate certain
of responsibilities to other service providers. Pursuant to this authority, the
Administrator has delegated certain administrative functions to The Bank of New
York. The Bank of New York is not an affiliated person of BNY Hamilton
Distributors.
Each Fund pays annual administration fees, accrued daily and payable
monthly, of .20% of average daily net assets for each Fund.
DISTRIBUTOR
In addition to acting as the Administrator, BNY Hamilton Distributors will be
the exclusive underwriter and distributor of shares of each Fund (the
'Distributor'); its offices are located at 125 West 55 Street, New York, New
York 10019.
The Distributor makes a continuous offering of each Fund's shares and bears
the costs and expenses of distributing to selected dealers and prospective
investors copies of any prospectuses, statements of additional information and
annual and interim reports of the Funds (after such items have been prepared,
set in type and sent by the Funds at their expense to existing shareholders)
that are used in connection with the offering of shares, and the costs and
expenses of preparing, printing and distributing any other literature used by
the Distributor or furnished by it for use by selected dealers in connection
with the offering of each Fund's shares for sale to the public.
The Administrator (and Distributor) is a wholly-owned subsidiary of The BISYS
Group, Inc., whose other subsidiaries provide distribution and administration
services for other mutual fund groups.
SUMMARY OF
SHAREHOLDER
SERVICES
A telephone representative will be happy to answer any questions you may have
concerning any of the Funds.
<TABLE>
<CAPTION>
Telephone For Information Regarding
<S> <C>
1-800-4BNY-FND o Any of the Funds' investment objectives and
(1-800-426-9363) 8 a.m. to 9 p.m., policies
Eastern time o Opening an account
1-800-952-6276 o Current account balances
8 a.m. to 9 p.m., Eastern time o Shareholder address/telephone changes
</TABLE>
(23) PROSPECTUS
<PAGE>
You should note that neither the Funds nor their service contractors
will be responsible for any loss or expense for acting upon telephone
instructions that they believe to be genuine. In attempting to confirm that
telephone instructions are genuine, the Funds will use procedures considered
reasonable, as described in 'Redemption of Shares' in the Statement of
Additional Information. To the extent that any of the Funds does not use
reasonable procedures to form its belief as to the genuineness of
accountholders' instructions, it and/or its service contractors may be
responsible for such instructions that are fraudulent or unauthorized.
The Funds want to keep shareholders current regarding the status of their
accounts. To assist you, the following statements and reports will be sent to
you:
<TABLE>
<S> <C>
CONFIRMATION STATEMENTS After every transaction that affects a
shareholder's account balance or account
registration.
ACCOUNT STATEMENTS Quarterly, showing any activity during the
quarter, any income credited during the
quarter and the current value of each
account.
FINANCIAL REPORTS Every six months, one copy of most Fund
reports and year-end tax information will
be mailed to each household, regardless of
how many accounts are in the household.
</TABLE>
FUND AND OTHER
SHAREHOLDER SERVICES
CUSTODIAN AND FUND ACCOUNTING AGENT
The Bank of New York, 90 Washington Street, New York, New York 10286, serves as
each Fund's custodian. BNY Hamilton Funds, Inc. has also entered into a Cash
Management and Related Services Agreement with The Bank of New York pursuant to
which The Bank of New York, as custodian, will receive and disburse funds in
connection with the purchases and redemptions of each Fund's shares.
The Bank of New York also serves as the fund accounting agent for each Fund
with responsibility for calculating the net asset value of, and maintaining the
books and records of, each class of shares for all Funds.
TRANSFER AGENT
BISYS Fund Services, Inc. ('BISYS'), P.O. Box 163310, Columbus, Ohio,
43216-3310, serves as each Fund's transfer agent. BISYS is a wholly-owned
subsidiary of The BISYS Group, Inc. As transfer agent, BISYS maintains the
records of each shareholder's account, answers shareholder inquiries concerning
accounts, processes purchases and redemptions of each Fund's shares, acts as
dividend and distribution disbursing agent and performs other shareholder
service functions.
PROSPECTUS (24)
<PAGE>
DISTRIBUTION PLAN
The Directors have adopted a plan of distribution under Rule 12b-1 of the 1940
Act with respect to the Investor Shares of each Fund (collectively, the '12b-1
Plans').
Under the 12b-1 Plans, the subject Fund may reimburse the Distributor for
expenses incurred in connection with the distribution of that Fund's shares.
Such distribution expenses will include expenses incurred in connection with
advertising and marketing such Fund's shares and expenses incurred in connection
with preparing, printing and distributing prospectuses for such Fund (except
those used for regulatory purposes or for distribution to existing shareholders
of each Fund) and in implementing and operating the 12b-1 Plans. To date, the
Directors have not adopted 12b-1 Plans with respect to the Institutional Class
of each Fund.
Under the 12b-1 Plans, reimbursements for distribution expenses may not
exceed .25% (annualized) of average daily net assets of the relevant Fund class,
excluding from such calculation, however, all shares acquired via a transfer of
assets from customer accounts at The Bank of New York. These amounts may be
reduced pursuant to undertakings by the Distributor. Payments for distribution
expenses under the 12b-1 Plans are subject to Rule 12b-1 under the 1940 Act.
Except for expenses related to telemarketing operations established for BNY
Hamilton Funds, Inc., it is presently contemplated that the Distributor will not
be reimbursed for any of its overhead expenses by a Fund class under its
respective 12b-1 Plan.
The 12b-1 Plans provide that if in any month the Distributor is due more
monies than are immediately payable because of the percentage limitation
described above, the unpaid amount will be carried forward from month to month
while the 12b-1 Plan is in effect until such time as it may be paid. Any carried
forward amounts will not be payable beyond the fiscal year during which the
amounts are accrued. No interest, carrying or other finance charge is borne by a
Fund class with respect to amounts carried forward past the fiscal year in which
it is incurred. As of December 31, 1997, there were no unreimbursed expenses
associated with any of the Fund's respective 12b-1 Plans.
FEE WAIVERS
Except as noted in this Prospectus and the Statement of Additional Information,
the Funds' service contractors bear all expenses in connection with the
performance of their services and each Fund bears the expenses incurred in its
operation. From time to time during the course of the Funds' fiscal year, each
of the Administrator and the Adviser may voluntarily elect not to receive
payment of fees under their respective agreements described above and/or to
assume certain expenses of a Fund while retaining the ability to be reimbursed
by a Fund for such amounts prior to the end of the fiscal year. This will have
the effect of increasing yield to investors at the time such fees are not
received or amounts are assumed by the Administrator or the Adviser and
decreasing yield when such fees or amounts are reimbursed to the Administrator
or the Adviser. See the Fee Table for each class of shares for each Fund.
(25) PROSPECTUS
<PAGE>
PURCHASE
OF SHARES
To purchase Institutional Shares in any Fund, contact your Bank of New York
representative for details.
The following table summarizes the types of investment accounts available
to purchasers of Investor Shares of each of the Funds along with their
respective minimum investment requirements. Unless otherwise noted, all types of
investment accounts shown in the table are applicable to Investor Shares of each
Fund.
<TABLE>
<CAPTION>
MINIMUM INVESTMENT REQUIRED
----------------------------------------------------------
INITIAL ADDITIONAL
TYPE OF INVESTMENT INVESTMENT INVESTMENT
- ------------------------------------------------------ --------------------------- ---------------------------
<S> <C> <C>
Regular Account....................................... $ 2,000 $ 100
Regular Account with Automatic Investment Program..... $ 500 $ 50
Regular Accounts for employees and retirees of The
Bank of New York and its affiliates, and employees
of each of the Administrator, the Distributor and
their affiliates (1)................................ $ 100 $ 25
Individual Retirement Account ('IRA')................. $ 250 $ 25
</TABLE>
- ------------------------------
(1) Available exclusively for employees and retirees of The Bank of New York and
its affiliates, and for the employees of BNY Hamilton Distributors, Inc.,
and their affiliates. The employees of The Bank of New York and its
affiliates may make investments through payroll deduction.
Institutional and Investor Shares of any of the Funds may be purchased
without sales commission at the net asset value per share next determined after
the purchase order and federal funds are received by the specific Fund. See 'Net
Asset Value'.
The Distributor, from time to time, at its expense, will also provide
additional compensation to dealers in connection with sales of Investor Shares
of any of the Funds. Such compensation will include non-cash payments which may
take the form of (1) gift certificates, (2) tickets for entertainment events,
(3) trips, including the provision of travel arrangements and lodging at
vacation resorts and (4) merchandise. Dealers may not use sales of the Funds'
shares to qualify for this compensation to the extent such sales may be
prohibited by laws of any state or any self-regulatory agency, such as The
National Association of Securities Dealers, Inc. None of the aforementioned
compensation is paid for by any Fund or its shareholders.
INITIAL INVESTMENTS
Orders for purchase of a Fund's Investor Shares received by 4:00 P.M. (Eastern
time) on any Business Day and transmitted to the Fund's transfer agent by 4:00
P.M. (Eastern time) will be based on the next determined net asset value. (For
purposes of this Prospectus, 'Business Day' is defined to mean any day on which
both the New York Stock Exchange and the custodian are open for business.)
Investors will begin to earn dividends on the next Business Day after receipt of
the purchase order. On those days when the New York Stock Exchange or the
custodian closes early as a result of such day being a partial holiday or
otherwise, the right is reserved to advance the time on that day by which
purchase and redemption requests must be received.
PROSPECTUS (26)
<PAGE>
Prospective investors may purchase a Fund's Investor Shares by check, by
federal funds wire, by bank wire, or by direct deposit. Additional investments
may also be made through an Automatic Investment Program. See the tables on the
following pages.
METHOD OF PURCHASE FOR INITIAL INVESTMENTS
BY CHECK
-- Complete and sign a New Account Application and mail it, together with a
check payable to the specific Fund, to: BNY Hamilton Funds, P. O. Box
163310, Columbus, Ohio 43216-3310.
-- Purchases made by check are not permitted to be redeemed until payment of
the purchase has been collected, which may take up to ten (10) Business
Days after purchase.
-- Purchases by check must be payable in United States dollars and drawn on
United States banks. The Funds will not accept third-party checks.
BY FEDERAL FUNDS WIRE
-- An investor desiring to purchase shares by wire should call the Transfer
Agent at 1-800-952-6276 and place a purchase order.
-- Have your bank wire federal funds to the BNY Hamilton Funds' bank account
(see below). In order to ensure prompt receipt by a Fund of a federal funds
wire, an investor should take the following steps:
A. Instruct your bank to wire the specified amount to the specific Fund's
account as follows (be sure to have your bank include the name of the
specific Fund selected, and state that the wire is for a new account):
The Bank of New York
New York, NY 10286
ABA #021000018
BNY Hamilton Funds
DDA #8900275847
Attn.: (specific Fund selected)
Ref.: (your account number, your account
name and taxpayer identification number)
B. Complete the New Account Application and mail it to the appropriate address
shown in 'By Check' above.
-- Federal funds purchase orders will only be accepted on Business Days as
defined herein. Your bank may charge a service fee for wiring funds.
BY BANK WIRE
-- Follow the same procedure outlined under 'By Federal Funds Wire' above.
Your bank may charge a service fee for wiring funds.
(27) PROSPECTUS
<PAGE>
BY DIRECT DEPOSIT
-- In certain circumstances, employees and retirees of The Bank of New York
and its affiliates may purchase Fund shares by having payments
automatically deposited into their specific Fund account.
-- Call 1-800-4BNY-FND (1-800-426-9363) for details.
METHOD OF PURCHASE FOR ADDITIONAL INVESTMENTS
BY CHECK
-- Make check payable to the specific Fund and send to: BNY Hamilton Funds,
Inc., P.O. Box 806, Newark, New Jersey 07101-0806. If possible, please
include the tear-off payment stub that accompanies a Fund's confirmation
statement.
BY FEDERAL FUNDS WIRE
-- Have your bank wire federal funds according to the instructions on the
previous page, except the wire should state that it is an additional
investment.
-- Please include your account number.
BY AUTOMATIC INVESTMENT PROGRAM
-- You may arrange, through the Automatic Investment Program, for purchases of
Fund shares (minimum of $50) by direct debit from your account at any
domestic financial institution that is an Automated Clearing House member.
-- To elect this feature, please complete Section 7 on the new account
application.
-- See 'Purchase of Shares--Automatic Investment Program' or call
1-800-4BNY-FND (1-800-426-9363) for further details on this investment
option.
BY BANK WIRE
-- The procedure is identical to 'By Federal Funds Wire' above.
BY DIRECT DEPOSIT
-- Call 1-800-4BNY-FND (1-800-426-9363) for details.
-- Additional purchases will be processed in accordance with your
instructions.
AUTOMATIC INVESTMENT PROGRAM
You may arrange, through the Automatic Investment Program, for systematic
investments in your Fund account(s) in amounts of $50 or more (PROVIDED AN
INITIAL INVESTMENT OF $500 OR MORE HAS BEEN ESTABLISHED) by directly debiting
your account at the financial institution designated by you on the new account
application. At your option, your checking, NOW or bank money market account
designated by you will be debited in the specified amount, and Investor Shares
will be purchased, once a month, on either the first or fifteenth day, or twice
a month on both days. Only accounts maintained at a domestic financial
institution which permits automatic withdrawals and is an Automated Clearing
House member are eligible.
The Automatic Investment Program enables shareholders to invest a fixed
dollar amount at predetermined intervals, an investment strategy known as
'dollar cost averaging'. By applying this technique consistently over time,
investors usually purchase more shares during
PROSPECTUS (28)
<PAGE>
periods of low share prices and fewer shares as share prices increase. You may
also implement dollar cost averaging on your own initiative or through other
entities.
To be effective, dollar cost averaging should be carried out consistently
for a sustained period of time. You should understand, however, that purchases
made through the Automatic Investment Program will be made by the Fund without
regard to share price on the day of investment or to market trends. In addition,
while you may find dollar cost averaging to be beneficial, it will not prevent a
loss if you ultimately redeem your shares at a price that is lower than their
purchase price.
You may cancel this privilege or change the amount of purchase at any time by
mailing written notification to:
BNY Hamilton Funds
P.O. Box 163310
Columbus, OH 43216-3310
Notification will be effective seven days following receipt. The Fund may modify
or terminate this privilege at any time or charge a service fee, although no
such fee currently is contemplated.
OTHER PURCHASE INFORMATION
Investors may purchase Investor Shares of any Equity Fund, Taxable Fixed Income
Fund, BNY Hamilton Intermediate Tax-Exempt Fund or Hamilton Classic Shares of
BNY Hamilton Money Fund offered by BNY Hamilton Funds, Inc., or a combination of
those Funds, in increments of 10% through an individual retirement account made
available by BNY Hamilton Funds, Inc., as described in the Minimum Investment
Required table earlier in this section. Please refer to a 'BNY Hamilton Funds
Individual Retirement Account' kit for details. Investors are also advised to
consult with their own legal counsel or tax adviser regarding these investments.
In the interest of economy and convenience and because of its operating
procedures, a Fund will not issue certificates representing ownership of either
class of its shares. All shares purchased will be confirmed to you and credited
to your account on the specific Fund's books maintained by the transfer agent.
You will have the same rights and ownership with respect to such shares as if
certificates had been issued.
To assure that checks are collected by a Fund, withdrawals of investments
made by check will not be permitted until payment for the purchase has been
received, which may take up to ten (10) Business Days after the date of
purchase. A Fund will charge a $15.00 processing fee for checks returned unpaid.
This charge may be deducted from the account of the investor that requested the
purchase. In addition, you may be prohibited or restricted from making future
purchases in any Fund offered by BNY Hamilton Funds, Inc.
Investors may also invest in any Fund offered by BNY Hamilton Funds, Inc.
by purchasing shares through registered broker-dealers, which are required to
effect the transaction at the net asset value next determined after receipt of
the order by the broker-dealer and are required to transmit such orders promptly
to the specific Fund. Broker-dealers who make purchases for their customers may
charge a fee for such services.
(29) PROSPECTUS
<PAGE>
Federal regulations require that investors provide a social security or
taxpayer identification number upon opening or re-opening an account.
Investors should refer to the New Account Application for further information
about this requirement.
REDEMPTION
OF SHARES
To redeem Institutional Shares in any Fund, contact your Bank of New York
representative for details.
Investors may withdraw all or any portion of the Investor Shares in their
account at any time by redeeming such shares. INVESTORS SHOULD BE AWARE THAT,
UNLIKE A SAVINGS ACCOUNT, A REDEMPTION IN ANY OF THE FUNDS IS A TAXABLE EVENT.
CONSULT YOUR TAX ADVISER FOR THE POTENTIAL TAX SITUATIONS THAT MAY ARISE AS A
RESULT OF A REDEMPTION OF SHARES.
METHOD OF REDEMPTION
A Fund will redeem Investor Shares at the next determined net asset value per
share. A Fund's net asset value per Investor Share will be determined on each
Business Day at 4:00 p.m. (Eastern time). The value of the shares redeemed may
be more or less than their original cost, depending upon a Fund's then-current
net asset value.
BY MAIL
-- Send your request to: BNY Hamilton Funds, P. O. Box 163310, Columbus, Ohio
43216-3310. (Be sure to include the name of the specific Fund and your
account number.)
BY TELEPHONE (1)
-- This option must have previously been elected. Call the specific Fund and
request that the redemption proceeds be mailed to the address listed in the
specific Fund's account records or wired to the investor's bank as listed
in the specific Fund's records.
BY SYSTEMATIC WITHDRAWAL
-- YOUR ACCOUNT MUST HAVE A VALUE OF $10,000 OR MORE.
-- The record owner of shares may request a declining balance withdrawal, a
fixed dollar withdrawal, a fixed share withdrawal, or a fixed percentage
withdrawal (based on the current value of shares in the account) on a
monthly, quarterly, semi-annual or annual basis.
-- Further information about establishing a Systematic Withdrawal Plan may be
obtained by calling 1-800-426-9363.
- ------------------------------
(1) In times of drastic market conditions, the telephone redemption option may
be difficult to implement. If you experience difficulty in making a
telephone redemption, you may make your request by regular mail or express
mail and it will be implemented at the net asset value per share next
determined after the request is received.
PROSPECTUS (30)
<PAGE>
Each Fund will redeem its Investor Shares at the net asset value next
determined after the request is received in good order. 'Good order' means that
the request to redeem Investor Shares includes the following documentation: (i)
a letter of instruction or a stock assignment containing the account number and
taxpayer identification number(s) of the shareholder(s), specifying the number
of shares or dollar amount to be redeemed and signed by all registered owners of
the shares in the exact names in which they are registered; (ii) any required
signature guarantees, see 'Further Redemption Information' below; and (iii)
other supporting legal documents, if required, in the case of estates, trusts,
guardianships, custodianships, corporations, pension and profit-sharing plans
and other organizations. The Funds may adopt certain procedures as described in
'Redemption of Shares' in the Statement of Additional Information to verify
information provided with a redemption request. Shareholders who are uncertain
of the requirements for redemption should consult with a BNY Hamilton Funds,
Inc. representative by calling 1-800-952-6276.
DISCRETIONARY REDEMPTION BY A FUND
If the value of a shareholder's holdings falls below $500 because of a
redemption of Investor Shares, the shareholder's remaining shares may be
involuntarily redeemed after 60 days' written notice, unless the value of the
account is increased to $500 or more.
FURTHER REDEMPTION INFORMATION
Normally, a Fund will make payment for all Investor Shares redeemed under these
procedures within one Business Day of receipt of the request, but in no event
will payment be made more than seven days after receipt of a redemption request
in good order. Notwithstanding the foregoing, a Fund will not make payments to
investors redeeming Investor Shares that were purchased by check until payment
for the purchase has been collected, which may take up to ten (10) Business Days
after the date of purchase. At various times, a Fund may be requested to redeem
Investor Shares for which it has not yet received good payment. In such
circumstances, the Fund may delay the forwarding of proceeds for up to 15 days
or more until payment has been collected for the purchase of such Investor
Shares. A Fund reserves the right to suspend redemption or postpone the date of
redemption at times when the New York Stock Exchange is closed or when trading
on the Exchange is restricted, under certain emergency circumstances and during
periods when such suspension is permitted by the Securities and Exchange
Commission. See the Statement of Additional Information; 'Redemption of
Shares--Further Redemption Information'.
To change the address listed in a specific Fund's account records or the
name of the commercial bank or account designated to receive redemption
proceeds, an investor must send a written request to: BNY Hamilton Funds, P. O.
Box 163310, Columbus, Ohio 43216-3310. Such requests must be signed by each
shareholder, and, for requests to change the bank or account designated to
receive redemption proceeds, each signature must be guaranteed.
(31) PROSPECTUS
<PAGE>
EXCHANGE
OF SHARES
Shareholders purchasing shares directly from the Funds may exchange those shares
at the current net asset per share at the current net asset per share for other
BNY Hamilton Funds which have a similar class of shares, in accordance with the
terms of the current prospectus of the Fund being acquired, without charge. An
exchange may be made so long as the shares to be exchanged have a value of at
least $500. Accordingly, when establishing a NEW account by exchange, shares of
the Fund being exchanged must have a value at least equal to the minimum initial
investment required by the Fund into which the exchange is being made (currently
$2,000 for all shares available to retail investors for each Fund in BNY
Hamilton Funds, Inc.). Shares will be exchanged on the basis of relative net
asset value per share.
Exchanges are in effect redemptions from one Fund and purchases of another
Fund and the usual purchase and redemption procedures and requirements are
applicable to exchanges. See 'Purchase of Shares' and 'Redemption of Shares'.
Before making any exchange, investors are advised to review the sections of this
Prospectus pertaining to the specific Fund or the appropriate sections of the
prospectuses for the other Funds in BNY Hamilton Funds, Inc.
Since an exchange is essentially a redemption from a specific Fund,
shareholders who exchange shares in any of the Funds for shares in any of the
other Funds may recognize a capital gain or loss for tax purposes. The Funds
reserve the right to discontinue, alter or limit the exchange privilege at any
time. At least 60 days' notice will be given to shareholders of any material
modification or termination. The exchange privilege will be honored only in
those states where such exchanges are legally permissible.
DIVIDENDS AND
DISTRIBUTIONS
The Equity Income Fund and Large Cap Growth Fund will declare dividends from net
investment income for each class of their respective shares monthly and will be
paid monthly within five (5) Business Days after such dividend is declared
(usually by the 20th day of the month). The Small Cap Growth Fund and
International Equity Fund will declare dividends from net investment income, if
any, and pay dividends for each class of their respective shares once annually.
Dividends and distributions will be payable to shareholders of record at the
time of declaration. The Directors may revise a Fund's dividend policy without
action by the shareholders.
Each of the Funds will distribute substantially all of any taxable net
long-term gains realized on investments to shareholders at least annually in
accordance with requirements under the Tax Code, as amended, and other
applicable statutory and regulatory requirements.
PROSPECTUS (32)
<PAGE>
DIVIDEND AND GAIN DISTRIBUTION OPTIONS
Each Fund will pay dividends and gain distributions, if any, in accordance with
the current option on each shareholder's account. If a shareholder does not
select a dividend and gain option, dividends and gains will be paid in
additional shares. Shareholders may choose to receive dividends in cash and any
gain distributions in shares or receive both dividends and any gain
distributions in cash. A shareholder can change the option selected on his or
her account by notifying the transfer agent in writing at least five (5)
Business Days prior to a dividend or gain distribution payment date. In the
event that a shareholder redeems all shares in an account between the record
date and the payable date, the value of the gain distributions declared and
payable will be paid in cash regardless of the existing election.
If you elect to receive distributions in cash, and the checks (1) are
returned and marked as 'undeliverable' or (2) remain uncashed for six months,
your cash election will be changed automatically and your future dividend and
capital gains distributions will be reinvested in the respective Fund at the per
share net asset value determined as of the date of payment of the distribution.
In addition, any undeliverable checks or checks that remain uncashed for six
months will be canceled and will be reinvested in the respective Fund at the per
share net asset value determined as of the date of cancellation.
NET ASSET
VALUE
Net asset value per share for each class of shares in each Fund will be
determined by subtracting from the value of the specific classes' total assets
the amount of its liabilities and dividing the remainder by the number of its
outstanding shares, rounding to the nearest one cent. Expenses, including the
fees payable to the Adviser and the Administrator, are accrued daily. See 'Net
Asset Value' in the Statement of Additional Information for more information on
valuation of portfolio securities for each Fund.
Each class of shares in each Fund will compute its net asset value once
daily on Monday through Friday, except that net asset value will not be computed
on any day in which no orders to purchase or redeem shares have been received or
on the holidays listed under 'Net Asset Value' in the Statement of Additional
Information. Each Fund computes net asset value of each class of its shares at
4:00 P.M., Eastern time.
(33) PROSPECTUS
<PAGE>
ORGANIZATION
BNY Hamilton Funds, Inc. is an open-end management investment company organized
as a Maryland corporation on May 1, 1992. The Articles of Incorporation
currently permit BNY Hamilton Funds, Inc. to issue 20,000,000,000 shares of
common stock, par value $.001 per share, which have been allocated as follows:
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
FUND COMMON STOCK AUTHORIZED
- ---------------------------------------------- -----------------------
<S> <C>
BNY Hamilton Equity Income Fund
Institutional Shares........................ 200,000,000
Investor Shares............................. 200,000,000
BNY Hamilton Large Cap Growth Fund
Institutional Shares........................ 200,000,000
Investor Shares............................. 200,000,000
BNY Hamilton Small Cap Growth Fund
Institutional Shares........................ 200,000,000
Investor Shares............................. 200,000,000
BNY Hamilton International Equity Fund
Institutional Shares........................ 200,000,000
Investor Shares............................. 200,000,000
</TABLE>
The Directors may increase the number of shares each Fund is authorized to issue
without the approval of shareholders. The Directors also have the power to
designate one or more series or classes of shares of common stock and to
classify and reclassify any unissued shares with respect to such series or
classes.
Shareholders of each series of BNY Hamilton Funds, Inc. are entitled to one
vote for each share and to the appropriate fractional vote for each fractional
share. There is no cumulative voting and no Funds' shares have any preemptive or
conversion rights. All shareholders will vote together as a single class on
matters affecting the relevant Fund generally, including matters relating to the
relevant Fund's investment advisory agreement, investment objective and
fundamental investment restrictions. Shareholders of a particular class will
vote separately on any matters relating only to that class. For example, holders
of Investor Shares will vote separately on matters relating to the class'
distribution plan under Rule 12b-1. Shares offered hereby must be fully-paid
upon issuance and thereafter will be non-assessable by BNY Hamilton Funds, Inc.
and the particular Fund to which they belong. The Funds do not intend to hold
meetings of shareholders. The Directors may call meetings of shareholders for
action by shareholder vote as may be required by the 1940 Act or permitted by
the Articles of Incorporation or Bylaws of BNY Hamilton Funds, Inc.
BNY Hamilton Funds, Inc., if requested to do so by the holders of at least
10% of the shares of all series aggregated as a class, will call a meeting of
shareholders for the purpose of voting upon the removal of a director or
directors and will assist in communications with other shareholders as required
by Section 16(c) of the 1940 Act. For further organization information,
including certain shareholder rights, see 'Description of Shares' in the
Statement of Additional Information.
PROSPECTUS (34)
<PAGE>
TAXES
The following discussion of federal tax consequences is based on United States
tax laws in effect on the date of this Prospectus. These laws and regulations
are subject to change by legislative, judicial or administrative action.
Investors are urged to consult their own tax advisors with respect to specific
questions as to federal taxes and with respect to the applicability of state,
local or foreign taxes. See 'Taxes' in the Statement of Additional Information.
Annual statements as to the federal tax status of distributions will be mailed
to shareholders shortly after the end of the taxable year.
Each Fund intends to qualify as a 'regulated investment company' under
Subchapter M of the Tax Code. As a regulated investment company, each Fund will
not be subject to federal income taxes on the net investment income and capital
gains distributed to shareholders, provided that it distributes annually at
least 90% of its net investment income and realized net short-term capital gains
in excess of net long-term capital losses.
Distributions of net investment income and realized net short-term capital
gains in excess of net long-term capital losses will generally be taxable to
shareholders of a Fund as ordinary income, whether such distributions are taken
in cash or reinvested in additional shares. Each of the Funds (other than the
International Equity Fund) expects that a portion of such distributions will be
eligible for the dividends-received deduction.
Distributions of net long-term capital gains in excess of net short-term
capital losses are taxable to shareholders of a Fund as long-term capital gains
regardless of how long the shareholders have held shares and regardless of
whether taken in cash or reinvested in additional shares. Long-term capital
gains distributions are not eligible for the dividends-received deduction.
Each Fund may be subject to foreign income taxes withheld at source. The
International Equity Fund, but not the other Funds, intends to elect to 'pass
through' such foreign income taxes to shareholders for foreign tax credit
purposes. Individual shareholders will be subject to federal income tax on
distributions of net long-term capital gains at a maximum rate of 28% if
designated as derived from a Fund's capital gains from property held for more
than one year and at a maximum rate of 20% if designated as derived from
property held for more than eighteen months.
UNLESS A SHAREHOLDER INCLUDES ITS TAXPAYER IDENTIFICATION NUMBER (SOCIAL
SECURITY NUMBER FOR INDIVIDUALS) ON THE ACCOUNT APPLICATION AND CERTIFIES THAT
IT IS NOT SUBJECT TO BACKUP WITHHOLDING, A FUND MAY BE REQUIRED TO WITHHOLD AND
REMIT TO THE U.S. TREASURY 31% OF TAXABLE DISTRIBUTIONS AND OTHER REPORTABLE
PAYMENTS TO THE SHAREHOLDER. SHAREHOLDERS SHOULD BE AWARE THAT, UNDER
REGULATIONS PROMULGATED BY THE INTERNAL REVENUE SERVICE, A FUND MAY BE FINED UP
TO $50 ANNUALLY FOR EACH ACCOUNT FOR WHICH A CERTIFIED TAXPAYER IDENTIFICATION
NUMBER IS NOT PROVIDED. IN THE EVENT THAT SUCH A FINE IS IMPOSED WITH RESPECT TO
ANY UNCERTIFIED ACCOUNT IN ANY YEAR, A CORRESPONDING CHARGE MAY BE MADE AGAINST
THAT ACCOUNT.
(35) PROSPECTUS
<PAGE>
ADDITIONAL
INFORMATION
The Funds will send to their shareholders annual and semi-annual reports. The
financial statements appearing in the annual reports will be audited by
independent auditors. Shareholders will also receive confirmations of each
purchase and redemption and monthly statements, reflecting all account activity,
including dividends reinvested in additional shares or credited as cash. Written
inquiries about the Funds should be sent to BNY Hamilton Funds, P.O. Box 163310,
Columbus, Ohio 43216-3310.
A Fund may make historical performance information of either of its classes
available and may advertise total return and 30-day yield as those terms are
defined in the Statement of Additional Information under 'Performance Data'. All
performance figures will be based on historical earnings and are not intended to
indicate future performance. Performance information may be obtained by calling
the Distributor at 1-800-4BNY-FND (1-800-426-9363).
PROSPECTUS (36)
<PAGE>
APPENDIX A
The following chart shows the comparison of the predecessor of BNY Hamilton
Large Cap Growth Fund and a comparable index. The average annual total return
figures for the predecessor of BNY Hamilton Large Cap Growth Fund have not been
audited.
[BAR CHART]
<TABLE>
<CAPTION>
BNY HAMILTON
LARGE CAP S&P 500
GROWTH FUND INDEX
------------ ---------
<S> <C> <C>
Average annual total return after one year............ 24.17% 23.07%
Average annual total return after five years.......... 13.03% 15.19%
Average annual total return after ten years........... 13.34% 15.29%
</TABLE>
The performance results presented above are those of Bank of New York CTF
Equity Fund, a private trust fund advised by The Bank of New York. These are not
performance results of any class of BNY Hamilton Large Cap Growth Fund, and
should not be interpreted as indicative of the future performance of the Large
Cap Growth Fund.
As of December 31, 1996, the Bank of New York CTF Equity Fund had aggregate
net assets of approximately $250 million. The Bank of New York CTF Equity Fund's
investment objective, policies and strategies are substantially similar to those
of the Large Cap Growth Fund, although, unlike the Large Cap Growth Fund, the
Bank of New York CTF Equity Fund is not subject to certain investment
limitations, tax restrictions, diversification requirements and other
restrictions imposed by law upon mutual funds, which, if applicable to the Bank
of New York CTF Equity Fund, may have adversely affected performance.
The Bank of New York CTF Equity Fund's performance results reflect
reinvestment of dividends. In addition, because the Bank of New York CTF Equity
Fund is not subject to advisory or administrative expenses usually associated
with mutual funds, the performance results have been adjusted to reflect the
deduction of the aggregate advisory, administrative and other expenses described
in this prospectus as being applicable to Investor Shares of BNY Hamilton Large
Cap Growth Fund. Performance shown conforms to the standards established by the
Association for Investment Management and Research.
The S&P 500 Index is an unmanaged index of common stocks and cannot be
invested in directly. The Index does not take into account fees and expenses.
Performance for the Equity Income Fund can be found in its Annual Report to
Shareholders, available from the Fund's Distributor upon request and without
charge.
(37) PROSPECTUS
<PAGE>
APPENDIX B
The following chart shows the comparison of the predecessor of BNY Hamilton
Small Cap Growth Fund and a comparable index. The average annual total return
figures for the predecessor of BNY Hamilton Small Cap Growth Fund have not been
audited.
[BAR CHART]
<TABLE>
<CAPTION>
BNY HAMILTON
SMALL CAP RUSSELL 2000
GROWTH FUND INDEX
------------ ------------
<S> <C> <C>
Average annual total return after one year........ 30.07% 16.49%
Average annual total return after five years...... 14.54% 15.62%
Average annual total return since inception*...... 20.18% 20.23%
</TABLE>
The performance results presented above are those of Bank of New York CIF
Emerging Growth Fund, a private trust fund advised by The Bank of New York.
These are not performance results of any class of BNY Hamilton Small Cap Growth
Fund, and should not be interpreted as indicative of the future performance of
BNY Hamilton Small Cap Growth Fund.
The Bank of New York CIF Emerging Growth Fund's investment objective,
policies and strategies are substantially similar to those of BNY Hamilton Small
Cap Growth Fund, although, unlike BNY Hamilton Small Cap Growth Fund, the Bank
of New York CIF Emerging Growth Fund is not subject to certain investment
limitations, tax restrictions, diversification requirements and other
restrictions imposed by law upon mutual funds, which, if applicable to the Bank
of New York CIF Emerging Growth Fund, may have adversely affected performance.
The Bank of New York CIF Emerging Growth Fund's performance results reflect
reinvestment of dividends. In addition, because the Bank of New York CIF
Emerging Growth Fund is not subject to advisory or administrative expenses
usually associated with mutual funds, the performance results have been adjusted
to reflect the deduction of the aggregate advisory, administrative and other
expenses described in this prospectus as being applicable to Investor Shares of
BNY Hamilton Small Cap Growth Fund. Performance shown conforms to the standards
established by the Association for Investment Management and Research.
The Russell 2000 Index is an unmanaged index of common stocks, and cannot
be invested in directly. The Index does not take into account fees and expenses.
Performance for the Equity Income Fund can be found in its Annual Report to
Shareholders, available from the Fund's Distributor upon request and without
charge.
- ------------------------------
* The Bank of New York CIF Emerging Growth Fund changed its investment objective
in the fourth quarter of 1990. Historical return prior to that time would not
be representative of its current management style.
PROSPECTUS (38)
<PAGE>
[This page intentionally left blank]
<PAGE>
BNY HAMILTON TAXABLE FIXED INCOME FUNDS
125 West 55th Street
New York, New York 10019
For information call 1-800-426-9363 (1-800-4BNY-FND)
BNY Hamilton Funds, Inc. is a family of no-load mutual funds for which there are
no sales charges or exchange or redemption fees. This Prospectus describes two
(2) taxable fixed income Funds (individually, a 'Fund' and collectively, the
'Funds') offered by the BNY Hamilton Family of Funds.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
FUND OBJECTIVE FOR INVESTORS SEEKING
- ---------------------------------------------------------------------------------------
<S> <C> <C>
BNY HAMILTON To earn as high a level of current Current income from U.S.
INTERMEDIATE income as is consistent with Government securities, minimal
GOVERNMENT FUND preservation of capital, moderate credit risk and relatively
stability in net asset value and stable share price
minimal credit risk
- ---------------------------------------------------------------------------------------
BNY HAMILTON To earn as high a level of current Current income from debt
INTERMEDIATE income as is consistent with obligations of domestic
INVESTMENT GRADE preservation of capital, moderate corporations, foreign
FUND stability in net asset value and corporations and foreign
maintenance of liquidity governments as well as U.S.
government securities, higher
level of risk and relatively
stable share price
- ---------------------------------------------------------------------------------------
</TABLE>
INVESTMENTS IN EITHER FUND ARE NOT BANK DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR INSURED BY, THE BANK OF NEW YORK, AND THE SHARES IN EITHER FUND
ARE NEITHER INSURED NOR GUARANTEED BY THE UNITED STATES GOVERNMENT, THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENTAL AGENCY. INVESTMENTS IN EITHER FUND INVOLVE INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
This Prospectus sets forth concisely the information that a prospective investor
should know about the Funds noted in the chart above before investing and should
be retained for future reference. Additional information about the Funds or
other members of the BNY Hamilton Family of Funds has been filed with the
Securities and Exchange Commission in the Statement of Additional Information
for BNY Hamilton Funds, Inc., dated April 30, 1998. This information is
incorporated by reference and is available without charge upon request from the
Funds' distributor, BNY Hamilton Distributors, Inc., 125 West 55th Street, New
York, NY 10019, Attention: BNY Hamilton Funds, Inc. 1-800-4BNY-FND
(1-800-426-9363).
- --------------------------------------------------------------------------------
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 date of this Prospectus is April 30, 1998
5/98 BNY-0091
PROSPECTUS
<PAGE>
TABLE
OF
CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Fee Table 1
- --------------------------------------------------------------------
Financial Highlights 3
- --------------------------------------------------------------------
Investment Objectives and Policies 5
- --------------------------------------------------------------------
Description of Securities 6
- --------------------------------------------------------------------
Additional Investment Information and Risk Considerations 7
- --------------------------------------------------------------------
Investment Restrictions 14
- --------------------------------------------------------------------
Management of the Funds 15
- --------------------------------------------------------------------
Summary of Shareholder Services 17
- --------------------------------------------------------------------
Fund and Other Shareholder Services 17
- --------------------------------------------------------------------
Purchase of Shares 19
- --------------------------------------------------------------------
Redemption of Shares 23
- --------------------------------------------------------------------
Exchange of Shares 26
- --------------------------------------------------------------------
Dividends and Distributions 26
- --------------------------------------------------------------------
Net Asset Value 27
- --------------------------------------------------------------------
Organization 28
- --------------------------------------------------------------------
Taxes 28
- --------------------------------------------------------------------
Additional Information 29
- --------------------------------------------------------------------
Appendix A 30
- --------------------------------------------------------------------
</TABLE>
PROSPECTUS
<PAGE>
FEE
TABLE
The following table illustrates the expenses an investor in either Fund will
incur. In addition, investments are subject to the annual fund operating
expenses (after expense limitations) set forth below.
<TABLE>
<CAPTION>
BNY HAMILTON
BNY HAMILTON INTERMEDIATE
INTERMEDIATE INVESTMENT
GOVERNMENT FUND GRADE FUND
---------------------------------------------------
INSTITUTIONAL INVESTOR INSTITUTIONAL INVESTOR
SHARES SHARES SHARES SHARES
---------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION
EXPENSES:
Sales Load Imposed
on Purchases............... None None None None
Sales Load Imposed on
Reinvested Dividends....... None None None None
Deferred Sales Load.......... None None None None
Redemption Fees.............. None None None None
Exchange Fees................ None None None None
ANNUAL FUND OPERATING EXPENSES
(AFTER LIMITATIONS):
(AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS)
Management Fees (After
Limitations)............... .61% .61% .70% .70%
12b-1 Fees................... .00% .25% .00% .25%
Other Expenses............... .29% .29% .10% .11%
---------------------------------------------------
Total Fund Operating Expenses
(After Limitations) ....... .90% 1.15% .80% 1.06%
---------------------------------------------------
---------------------------------------------------
EXAMPLE:
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:
</TABLE>
<TABLE>
<CAPTION>
BNY HAMILTON
BNY HAMILTON INTERMEDIATE
INTERMEDIATE INVESTMENT
GOVERNMENT FUND GRADE FUND
----------------------------------------------------
INSTITUTIONAL INVESTOR INSTITUTIONAL INVESTOR
SHARES SHARES SHARES SHARES
----------------------------------------------------
<S> <C> <C> <C> <C>
1 year................... $ 9 $ 12 $ 8 $ 11
3 years.................. $ 29 $ 37 $ 26 $ 34
5 years.................. $ 50 $ 64 $ 45 $ 59
10 years................. $ 111 $140 $ 99 $130
</TABLE>
(1) PROSPECTUS
<PAGE>
This table is designed to assist investors in understanding the various
direct and indirect costs that an investor would bear. Long-term shareholders
of Investor Shares of either Fund may pay more than the economic equivalent of
a maximum front-end sales load imposed on purchases permitted by the National
Association of Securities Dealers, Inc. The Adviser as defined in 'Management of
the Funds' has agreed to limit expenses of each Fund to .90% and 1.15% of its
average daily net assets of each Fund's Institutional Shares and Investor
Shares, respectively. Were expenses not so limited, Management Fees would be
.70% for each class of shares in BNY Hamilton Intermediate Government Fund, and
Total Fund Operating Expenses would be .99% and 1.24% for the Institutional
Shares and Investor Shares of BNY Hamilton Intermediate Government Fund,
respectively. Management reserves the right to implement or discontinue expense
limitations at any time. See 'Fund and Other Shareholder Services--Fee Waivers'.
For a description of contractual fee arrangements or the fees and expenses
included in Other Expenses, see 'Management of the Funds' and 'Fund and Other
Shareholder Services'. In connection with the example, please note that $1,000
is less than the generally applicable minimum initial investment required for
each of the Funds and that there are no redemption or exchange fees of any kind.
See 'Purchase of Shares' and 'Redemption of Shares'.
THE EXAMPLE IS HYPOTHETICAL; IT IS INCLUDED SOLELY FOR ILLUSTRATIVE
PURPOSES. IT SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
PERFORMANCE; ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. EXPENSES PAID
AS SHOWN ABOVE REFLECT ESTIMATES MADE BY THE FUNDS AS OF THE DATE OF THIS
PROSPECTUS.
PROSPECTUS (2)
<PAGE>
FINANCIAL
HIGHLIGHTS
The following selected financial data for shares of BNY Hamilton Intermediate
Government Fund was audited by KPMG Peat Marwick LLP, independent accountants
for the year ended December 31, 1997, and by Deloitte & Touche LLP, independent
accountants, for all other periods presented, whose reports thereon appear in
the Fund's annual reports. This information should be read in conjunction with
the financial statements and related notes that also appear in the Fund's Annual
Report dated December 31, 1997 which is incorporated by reference into the
Statement of Additional Information.
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
<TABLE>
<CAPTION>
INSTITUTIONAL
SHARES INVESTOR SHARES
-------------- --------------------------------------------------------------
FOR THE PERIOD FOR THE PERIOD
APRIL 1, 1997* AUGUST 10, 1992*
THROUGH YEAR ENDED DECEMBER 31, THROUGH
DECEMBER 31, ------------------------------------------- DECEMBER 31,
1997 1997 1996 1995 1994 1993 1992
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at
beginning of period...... $ 9.53 $ 9.70 $ 9.94 $ 9.10 $ 10.12 $ 9.87 $ 10.00
------------------------------------------------------------------------------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income..... 0.42 0.54 0.54 0.53 0.50 0.51 0.18
Net realized and
unrealized gain (loss) on
investments.............. 0.35 0.17 (0.24) 0.84 (1.02) 0.27 (0.13)
------------------------------------------------------------------------------
Total from investment
operations............. 0.77 0.71 0.30 1.37 (0.52) 0.78 0.05
------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTION
Dividends from net
investment income........ (0.42) (0.54) (0.54) (0.53) (0.50) (0.51) (0.18)
Distribution from capital
gains.................... -- -- -- -- -- (0.02) --
------------------------------------------------------------------------------
Total dividends and
distribution........... (0.42) (0.54) (0.54) (0.53) (0.50) (0.53) (0.18)
------------------------------------------------------------------------------
Net asset value at end of
period................... $ 9.88 $ 9.87 $ 9.70 $ 9.94 $ 9.10 $ 10.12 $ 9.87
------------------------------------------------------------------------------
------------------------------------------------------------------------------
TOTAL RETURN:+............ 8.27%** 7.54% 3.16% 15.40% (5.17)% 8.03% 0.51%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of
period
(000's omitted).......... $ 64,128 $10,458 $64,117 $60,659 $59,328 $72,069 $25,575
RATIO TO AVERAGE NET ASSETS OF:
Expenses, net of waiver
from The Bank of New
York..................... 0.90%*** 1.08% 1.02% 1.06% 1.07% 0.86% 0.75%***
Expenses, prior to waiver
from The Bank of New
York..................... 0.99%*** 1.11% 1.02% 1.06% 1.10% 1.15% 1.64%***
Net investment income, net
of waiver from The Bank
of New York.............. 5.79%*** 5.57% 5.54% 5.52% 5.30% 5.04% 4.62%***
Portfolio turnover rate... 41% 41% 57% 48% 49% 67% 63%
</TABLE>
- ------------------------------
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
+ Total return does not consider the effect of the sales load for those periods
which the sales load was in effect.
Further information about the performance of BNY Hamilton Intermediate
Government Fund is contained in the Fund's annual report to shareholders, which
may be obtained from the distributor, BNY Hamilton Distributors, Inc., upon
request and without charge.
(3) PROSPECTUS
<PAGE>
The following selected financial data for shares of BNY Hamilton Intermediate
Investment Grade Fund was audited by KPMG Peat Marwick LLP, independent
accountants, whose report thereon appears in the Fund's annual report. This
information should be read in conjunction with the financial statements and
related notes that also appear in the Fund's Annual Report dated December 31,
1997 which is incorporated by reference into the Statement of Additional
Information.
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
<TABLE>
<CAPTION>
INSTITUTIONAL INVESTOR
SHARES SHARES
-------------- --------------
FOR THE FOR THE
PERIOD PERIOD
APRIL 1, 1997* MAY 1, 1997*
THROUGH THROUGH
DECEMBER 31, DECEMBER 31,
1997 1997
<S> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period......... $ 10.00 $10.08
--------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income.......................... 0.47 0.40
Net realized and unrealized gain on
investments.................................. 0.45 0.37
--------------------------------
Total from investment operations............. 0.92 0.77
--------------------------------
DIVIDENDS
Dividends from net investment income........... (0.47) (0.40)
--------------------------------
Net asset value at end of period............... $ 10.45 $10.45
--------------------------------
--------------------------------
TOTAL RETURN:.................................. 9.34%** 7.76%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's omitted).... $350,330 $1,891
RATIO TO AVERAGE NET ASSETS OF:
Expenses..................................... 0.80%*** 1.06%***
Net investment income........................ 6.14%*** 5.74%***
Portfolio turnover rate........................ 81% 81%
</TABLE>
- ------------------------------
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Intermediate
Investment Grade Fund is contained in the Fund's annual report to shareholders,
which may be obtained from the distributor, BNY Hamilton Distributors, Inc.,
upon request and without charge.
PROSPECTUS (4)
<PAGE>
INVESTMENT OBJECTIVES
AND POLICIES
The investment objective of each Fund is described below, together with a
summary of the policies each Fund will employ in its efforts to achieve its
objective. There can be no assurance that either Fund will attain its respective
investment objective.
INTRODUCTION
The Funds are open-end management investment companies (commonly known as mutual
funds) registered under the Investment Company Act of 1940 (the '1940 Act').
Each of the Funds will be considered a separate pool of assets with its own
distinctive investment objectives and policies, as described below.
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
(The 'Intermediate Government Fund')
The Intermediate Government Fund's investment objective is to earn as high a
level of current income as is consistent with preservation of capital, moderate
stability in net asset value and minimal credit risk. The Intermediate
Government Fund will attempt to accomplish this objective by investing in
obligations issued or guaranteed by the United States Government and backed by
the full faith and credit of the United States. The Intermediate Government Fund
may also invest in obligations issued or guaranteed by United States Government
agencies or instrumentalities where it must look principally to the issuing or
guaranteeing agency for ultimate repayment. Examples of agencies or
instrumentalities issuing these obligations are the Federal Farm Credit Systems
and the Federal Home Loan Banks. Although the United States Government or its
agencies or instrumentalities are ultimately responsible for payments on these
obligations, they do not guarantee the market value of such obligations.
In an effort to manage interest rate risk and principal stability of the
Intermediate Government Fund's net asset value, the Intermediate Government Fund
will invest in a portfolio of debt instruments which, during normal market
conditions, will have a dollar weighted average maturity not less that three nor
more than ten years. Under normal circumstances, the Intermediate Government
Fund will invest at least 65% of the value of its total assets in such types of
Government securities.
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
(The 'Intermediate Investment Grade Fund')
The Intermediate Investment Grade Fund's investment objective is to earn as high
a level of current income as is consistent with preservation of capital,
moderate stability in net asset value and maintenance of liquidity. In normal
circumstances, the Intermediate Investment Grade Fund will invest at least 65%
of the value of its total assets in securities rated investment grade. The
average maturity of the Fund will range between three and ten years. The maximum
average maturity of any individual security at the time of purchase will be 15
years. The Intermediate Investment Grade Fund will invest in obligations issued
or guaranteed by the United States Government and backed by the full faith and
credit of the United States. The Fund may
also invest in obligations issued or guaranteed by United States Government
agencies
(5) PROSPECTUS
<PAGE>
or instrumentalities, where the Fund must look principally to the issuing or
guaranteeing agency for ultimate repayment.
In addition, the Intermediate Investment Grade Fund will invest in U.S.
dollar denominated debt obligations of domestic corporations, foreign
corporations and foreign governments.
Both Funds may purchase or sell financial futures contracts and options in
an effort to reduce portfolio volatility, moderate market risk and minimize
fluctuations in net asset value. For a discussion of these investments, see
'Hedging' in 'Additional Investment Information and Risk Considerations'.
DESCRIPTION
OF SECURITIES
MORTGAGE-BACKED SECURITIES AND ASSET-BACKED SECURITIES
The Funds may invest in mortgage backed securities, including collateralized
mortgage obligations ('CMOs') and stripped mortgage back securities. A mortgage
pass-through security is a pro-rata interest in a pool of mortgages where the
cash flow generated from the mortgage collateral is passed through to the
security holder. CMOs are pass-through securities collateralized by mortgages or
mortgage-backed securities. CMOs are issued in classes and series that have
different maturities and often are retired in sequence. Mortgage-backed
securities evidence an undivided interest in mortgage pools. These securities
are subject to more rapid repayment than their stated maturity would indicate
because repayment of principal on mortgages in the pool are passed through to
the holder of the securities. During periods of declining interest rates,
prepayment of mortgages in the pool can be expected to increase. The
pass-through of these prepayments would have the effect of reducing a Fund's
position in these securities and requiring a Fund to reinvest the prepayments at
interest rates prevailing at the time of reinvestment.
Stripped mortgage-back securities are derivative multiclass mortgage
securities which may be issued by agencies or instrumentalities of the United
States Government, or by private originators of, or investors in, mortgage
loans, including savings and loan associations, mortgage banks, commercial
banks, investment banks and special purpose subsidiaries of the foregoing.
Stripped mortgage-back securities issued by parties other than agencies or
instrumentalities of the United States Government are considered, under current
guidelines of the staff of the Securities and Exchange Commission, to be
illiquid securities.
Stripped mortgage-backed securities are structured with two or more classes
of securities that receive different proportions of the interest and principal
distributions on a pool of mortgage assets. A common type of stripped
mortgage-backed security will have at least one class receiving only a small
portion of the interest and a larger portion of the principal from the mortgage
assets, while the other classes will receive primarily interest and only a small
portion of the principal. In the most extreme case, one class will receive all
of the interest (the interest-
PROSPECTUS (6)
<PAGE>
only or 'IO' class), while the other class will receive all of the principal
(the principal-only or 'PO' class). The yield to maturity on an IO class is
extremely sensitive to the rate of principal payments (including prepayments) on
the related underlying mortgage assets, and a rapid rate of principal payments
may have a material adverse effect on such security's yield to maturity.
If the underlying mortgage assets experience greater than anticipated
prepayments of principal, a Fund may fail to recoup fully its initial investment
in these securities even if the securities are rated AAA by Standard & Poor's
Ratings Group ('S&P') or Aaa by Moody's Investors Services ('Moody's').
The Funds may also invest in asset-backed securities. Asset-backed
securities represent participation in payment streams generated by particular
assets such as motor vehicle or credit card receivables. The asset-backed
securities in which a Fund may invest are subject to a Fund's overall credit
requirements. Asset-backed securities in general, however, are subject to
certain risks. Most of these risks are related to limited interests in the
applicable collateral. For example, credit card debt receivables are generally
unsecured and the debtors are entitled to the protection of a number of state
and federal consumer credit laws, many of which may have the effect of reducing
the balance due. Additionally, if a letter of credit is issued on behalf of an
asset-backed security (which typically would guarantee payment up to a stated
amount by a bank), and the stated amount in the letter of credit is exhausted,
holders of asset-backed securities may also experience delays in payments or
losses if the full amounts due on the underlying sales contracts are not
realized.
ADDITIONAL INVESTMENT
INFORMATION AND
RISK CONSIDERATIONS
The following paragraphs describe other types of securities transactions in
which the Funds may engage. Generally, the following types of securities and
transactions involve more risk than those discussed in 'Description of
Securities'. Unless otherwise noted, the following paragraphs are applicable to
both Funds.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
The Funds may purchase securities on a when-issued or delayed delivery basis.
Delivery of and payment for these securities may take as long as a month or more
after the date of the purchase commitment. The value of these securities is
subject to market fluctuation during this period and no interest or income is
accrued until settlement. A Fund will maintain with the custodian a separate
account with a segregated portfolio of liquid assets consisting of cash, U.S.
Government securities or other liquid high-grade debt securities in an amount at
least equal to these commitments. When entering into a when-issued or delayed
delivery transaction, a Fund will rely on the other party to consummate the
transaction; if the other party fails to do so, the Fund may be disadvantaged.
It is the current policy of the Funds not to enter into when-issued commitments
exceeding in the aggregate 25% of the market value of the Fund's total assets
less liabilities other than the obligations created by these commitments.
(7) PROSPECTUS
<PAGE>
REPURCHASE AGREEMENTS
Each Fund may enter into repurchase agreements with brokers, dealers or banks
that meet the credit guidelines established by the Board of Directors (the
'Directors') of BNY Hamilton Funds, Inc. In a repurchase agreement, a Fund buys
a security from a seller that has agreed to repurchase it at a mutually agreed
upon date and at a price reflecting the interest rate effective for the term of
the agreement. The term of these agreements is usually from overnight to one
week. A repurchase agreement may be viewed as a fully collateralized loan of
money by a Fund to the seller. A Fund always receives, as collateral, securities
with a market value at least equal to purchase price plus accrued interest and
this value is maintained during the term of the agreement. If the seller
defaults and the collateral value declines, a Fund might incur a loss. If
bankruptcy proceedings are commenced with respect to the seller, a Fund's
realization upon the collateral may be delayed or limited. Investments in
certain repurchase agreements and certain other investments that may be
considered illiquid are limited as set forth under 'Investment Restrictions'.
LOANS OF PORTFOLIO SECURITIES
Subject to applicable investment restrictions, a Fund is permitted to lend its
securities. These loans must be secured continuously by cash, U.S. Government
securities or other liquid high-grade short-term debt obligations in an account
segregated by the custodian or by a letter of credit at least equal to the
market value of the securities loaned plus accrued interest or income. For more
information, see 'Investment Objectives and Policies--Loans of Portfolio
Securities' in the Statement of Additional Information.
REVERSE REPURCHASE AGREEMENTS
Each Fund is permitted to enter into reverse repurchase agreements. In a reverse
repurchase agreement, a Fund sells a security and agrees to repurchase it at a
mutually agreed upon date and at a price reflecting the interest rate effective
for the term of the agreement. This may also be viewed as the borrowing of money
by a Fund. A Fund will not invest the proceeds of a reverse repurchase agreement
for a period which exceeds the duration of the reverse repurchase agreement. A
Fund may not enter into reverse repurchase agreements exceeding in the aggregate
one-third of the market value of its total assets, less liabilities other than
the obligations created by reverse repurchase agreements. Each Fund will
establish and maintain with its custodian a separate account with a segregated
portfolio of liquid assets consisting of cash, U.S. Government securities or
other liquid high-grade debt securities in an amount at least equal to its
purchase obligations under its repurchase agreements.
Reverse repurchase agreements involve the risk that the market value of the
securities retained by a Fund may decline below the price of the securities it
has sold but is obligated to repurchase under the agreement. In the event the
buyer of securities under a reverse repurchase agreement files for bankruptcy or
becomes insolvent, a Fund's use of proceeds from the agreement may be restricted
pending a determination by the other party or its trustee or receiver whether to
enforce a Fund's obligation to repurchase the securities.
PROSPECTUS (8)
<PAGE>
INVESTMENT COMPANY SECURITIES
The Funds may invest in the securities of other investment companies to the
extent permitted under the 1940 Act. These limits require that, as determined
immediately after a purchase is made, (i) not more than 5% of the value of a
Fund's total assets will be invested in the securities of any one investment
company, (ii) not more than 10% of the value of such Fund's total assets will be
invested in the aggregate in securities of investment companies as a group and
(iii) not more than 3% of the outstanding voting stock of any one investment
company will be owned by such Fund. As a shareholder of another investment
company, a Fund would bear, along with other shareholders, its pro rata portion
of the other investment company's expenses, including advisory fees. These
expenses would be in addition to the advisory and other expenses that such Fund
bears directly in connection with its own operations.
PRIVATELY PLACED AND CERTAIN UNREGISTERED SECURITIES
Each Fund may acquire, in privately negotiated transactions, restricted
securities which cannot be offered for public sale in the United States without
first being registered under the Securities Act of 1933, as amended (the
'Securities Act'). The price a Fund pays for these securities, or receives upon
resale, may be lower than the price the Fund would pay or receive for similar
securities with a more liquid market. Accordingly, the valuation of these
securities by a Fund will reflect any limitations on their liquidity. Each Fund
may also purchase certain unregistered securities sold to institutional
investors under Rule 144A of the Securities Act ('Rule 144A Securities'). Rule
144A Securities that have a readily available market may be deemed to be liquid
for purposes of each Fund's 15% limitation on investments in illiquid
securities. The investment adviser will monitor the liquidity of such restricted
securities under the supervision of, and pursuant to guidelines established by,
the Directors. In establishing these guidelines, the Directors will take into
account factors such as trading activity, availability of reliable price
information and other relevant information. Investing in Rule 144A Securities
could have the effect of increasing the level of a Fund's illiquidity to the
extent that qualified institutional buyers become, for a time, uninterested in
purchasing these securities. Acquisition by a Fund of illiquid investments (any
investment that cannot be disposed of within three (3) Business Days in the
normal course of business at approximately the amount at which it was valued by
a Fund) is subject to the 15% limitation described below under 'Investment
Restrictions'.
HEDGING
Hedging is a means of transferring risk that an investor does not wish to assume
during an uncertain market environment. The Funds are permitted to enter into
these transactions solely (a) to hedge against changes in the market value of
portfolio securities and against changes in the market value of securities
intended to be purchased, or (b) to close out or offset existing positions.
Hedging activity in the Funds may include selling futures contracts on debt
securities and indexes of debt securities and purchasing or writing (selling)
options on these futures, on debt securities and on indexes of debt securities
traded on registered securities exchanges and contract markets. All hedging
transactions must be appropriate to reduction of risk; they cannot be for
speculation.
(9) PROSPECTUS
<PAGE>
Under regulations of the Commodity Exchange Act of 1936, as amended (the
'Commodity Exchange Act'), an investment company registered under the 1940
Act is exempt from the definition of 'commodity pool operator', and therefore
not subject to regulation under the Commodity Exchange Act, provided that the
entity agrees to restrict its investments in commodity futures and commodity
options contracts to (i) bona fide hedging transactions within the meaning of
the Commodity Futures Trading Commission's regulations, without any limitation
on quantity, and (ii) other futures and options transactions in which the
aggregate initial margin and premiums do no exceed 5% of the liquidation value
of the entity's portfolio after taking into account unrealized profits and
unrealized losses on any such contracts. The Funds will only use commodity
futures and commodity options contracts in a manner consistent with these
requirements.
FINANCIAL FUTURES CONTRACTS AND OPTIONS ON FUTURES, DEBT SECURITIES AND INDEXES
OF DEBT SECURITIES
The Funds may (a) sell futures contracts on debt securities and indices of debt
securities and (b) purchase or write (sell) options on these futures, on debt
securities and on indexes of debt securities traded on registered securities
exchanges and contract markets.
Presently, futures contracts are available in several types of fixed income
securities, including U.S. Treasury bonds and notes, Government National
Mortgage Association modified pass-through mortgage-backed securities,
three-month U.S. Treasury bills and bank certificates of deposit.
When a futures contract is entered into, each party deposits with a broker
or in a segregated custodial account a good faith deposit of approximately
1 1/2-2% of the contract amount, called the 'initial margin'. Additionally,
during the term of the contract, the amount of the deposit is adjusted daily
based on the current value of the futures contract by payments of 'variation
margin' to or from the broker or segregated account.
Financial futures contracts obligate the seller to deliver a specific type
of security, at a specified time for a specified price. Although most interest
rate futures contracts call for making or taking delivery of the underlying
securities, these obligations are typically canceled or closed out before the
scheduled settlement date. The closing is accomplished by purchasing (or
selling) an identical futures contract to offset a short (or long) position.
Such an offsetting transaction cancels the contractual obligations established
by the original futures transaction. Other financial futures contracts call for
cash settlements rather than delivery of securities. If the price of the
offsetting futures transaction varies from the price of the original futures
transaction, the hedger will realize a gain or loss corresponding to the
difference. That gain or loss will tend to offset the unrealized loss or gain on
the hedged securities position, but may not always or completely do so.
There are risks associated with the use of futures contracts for hedging
purposes. In certain market conditions, as with rising interest rates, futures
contracts may not completely offset a decline in value of portfolio securities.
It may not always be possible to execute a buy or sell order at the desired
price or to close out an open position due to market conditions, limits on open
positions, and/or daily price fluctuation limits. Changes in market interest
rates may
P PROSPECTUS (10)
<PAGE>
differ substantially from those anticipated when hedge positions were
established. If a Fund has purchased futures to hedge against rising interest
rates and interest rates decline, the value of the Fund's portfolio will
increase, but at least part of the benefit of the increase will be lost because
of losses in the futures position. A Fund may have to sell securities to meet
daily maintenance margin requirements. The risk of loss to a Fund is
theoretically unlimited when an uncovered futures contract is sold because there
is an obligation to make delivery unless the contract closed out, regardless of
fluctuations in the price of the underlying security.
The Funds intend to engage in transactions in futures contracts and options
on futures contracts as a hedge against changes, resulting from market
conditions, in the value of securities which are held in a Fund's portfolio or
which a Fund intends to purchase. In accordance with current Commodity Futures
Trading Commission ('CFTC') regulations, neither Fund will enter into any
financial futures contract or purchase related options (as defined in the CFTC
regulations) if immediately thereafter, the aggregate initial margin for its
outstanding futures contracts and premiums paid for such options would exceed 5%
of the fair market value of its total assets. In addition, a Fund will not enter
into any financial futures contract or purchase related options (as defined in
the CFTC regulations) if immediately thereafter the sum of initial and net
cumulative variation margins on its outstanding futures contracts, together with
premiums paid on options thereon, would exceed 20% of its total assets.
When a Fund attempts to hedge its portfolio by selling an interest rate
futures contract, purchasing a put option thereon or writing a call option
thereon, it will own an amount of United States Government securities
corresponding to the open futures or option position. With respect to long
positions assumed by a Fund, it will segregate with its custodian, or in a
margin account with a broker, an amount of liquid assets consisting of cash,
U.S. Government securities or other liquid high-grade debt securities permitted
by CFTC regulations equal to the market value of the futures contracts and
thereby insure that the use of futures contracts is unleveraged.
A Fund may purchase call options and write (sell) put options on debt
securities to close out open option positions, purchase put options to protect
its holding from a decline in market value, and write call options. The Funds
may also purchase put options and write call options on futures contracts that
are traded on a United States exchange or board of trade and enter into closing
transactions with respect to these options. A Fund may use options on futures
contracts under the same conditions it uses put and call options on debt
securities. The effect of a futures contract may also be created by simultaneous
purchase of a put option and sale of a call option on the same security. When a
Fund purchases a put option or call option, the maximum risk of loss to it is
the price of the option purchased. The use of options as a hedge rather than
financial futures contracts may result in partial hedges because of the limits
inherent in the exercise prices. Neither Fund will invest more than 5% of its
net assets in premiums on put options.
The Funds may also utilize futures contracts on bond indices or related put
and call options on these index contracts. The Funds' strategies in employing
these contracts would be similar to the strategies applicable to futures and
options contracts generally. The Intermediate Government Fund may also buy put
options and sell call options on municipal bond indices.
The hedging activities of the Funds are subject to several additional
restrictions. A Fund's ability to engage in hedging activities may be further
limited by certain income tax considerations. See 'Taxes' in the Statement of
Additional Information.
(11) PROSPECTUS
<PAGE>
To the extent a Fund uses hedging instruments that do not involve
specific portfolio securities, offsetting price changes between the hedging
instruments and the securities being hedged will not always be possible, and
the market value fluctuations of the portfolio may not be completely eliminated.
When using hedging instruments that do not specifically correlate with
securities in a Fund's portfolio, the investment adviser will attempt to create
a very closely correlated hedge.
The Funds may purchase put options on interest rate futures contracts that
are traded on United States commodity exchanges, and write (i.e., sell) put and
call options on such futures contracts. The Funds only intend to engage in
options on futures contracts for bona fide hedging purposes in compliance with
CFTC regulations. An option on a futures contract gives the purchaser the right,
but not the obligation, to assume a position in a futures contract (which
position may be a long or short position) at a specified exercise price at any
time during the option exercise period. The writer of the option is required
upon exercise to assume an offsetting futures position (which position may be a
long or short position). Upon exercise of the option, the assumption of
offsetting futures positions by the writer and holder of the option will be
accompanied by delivery of the accumulated balance in the writer's futures
margin account that represents the amount by which the market price of the
futures contract, at exercise, exceeds, in the case of a call, or is less than,
in the case of a put, the exercise price of the option on the futures contract.
Currently, options can be purchased or written with respect to futures contracts
on United States Treasury bonds and United States Treasury notes on the Chicago
Board of Trade.
When a Fund hedges its portfolio by purchasing a put option or writing a
call option on a futures contract, it will own a long futures position or an
amount of high-grade debt securities corresponding to the open option position.
When a Fund writes a put option on a futures contract, it may, rather than
establish a segregated account, sell the futures contract underlying the put
option or purchase a similar put option. In instances involving the purchase of
a call option on a futures contract, a Fund will deposit in a segregated account
with its custodian an amount in cash, cash equivalents or liquid, high-grade,
fixed-income debt securities equal to the market value of the obligation
underlying the futures contract, less any amount held in the initial variation
margin accounts.
The holder or writer of an option may terminate its position by selling or
purchasing an option of the same series. There is no guarantee that such closing
transactions can be effected at any particular time or at all.
A Fund will be required to deposit initial and variation margin with
respect to put and call options on futures contracts written by it pursuant to
the Fund's futures commissions merchants' requirements, which are similar to
those applicable to interest rate futures contracts described above.
RISKS OF FUTURES TRANSACTIONS
Each Fund's successful use of futures contracts and options thereon depends upon
the ability of its investment adviser to predict movements in the direction of
interest rates and other factors affecting markets for securities, and upon the
degree of correlation between prices of the futures contracts and the prices of
the securities being hedged. As a result, even a correct forecast of interest
rate changes may not result in a successful hedging transaction. Although
futures
PROSPECTUS (12)
<PAGE>
contracts and options thereon may limit exposure to loss, they may also limit a
Fund's potential for capital gains. For example, if a Fund has hedged against
the possibility of an increase in interest rates which would adversely affect
the price of securities in its portfolio and prices of such securities increase
instead, it will lose part or all of the benefit of the increased value of its
securities because it will have offsetting losses in its futures positions. In
addition, in such situations, if a Fund has insufficient cash to meet daily
variation margin requirements, it may have to sell securities to meet such
requirements. Such sales of securities may be, but will not necessarily be, at
increased prices which reflect the rising market. A Fund may have to sell
securities at a time when it is disadvantageous to do so. Where futures are
purchased to hedge against the possible increase in price of securities before a
Fund is able to invest its cash in an orderly fashion, it is possible that the
market may decline instead; if the Fund's investment adviser then concludes not
to invest in securities at that time because of concern as to possible future
market decline or for other reasons, there would be a realized loss on the
futures contract that is not offset by a reduction in the price of the
securities purchased. The risk of loss to a Fund is theoretically unlimited if
no investment in securities is made as a result of the market conditions noted
above. Although a Fund will enter into futures contracts only on exchanges where
there appears to be a liquid market, there can be no assurance that such
liquidity will always exist.
Brokerage commissions on a Fund's financial futures and options
transactions and premium costs for purchasing options may tend to reduce its
yield.
For further information about a Fund's hedging activities, see 'Investment
Objectives and Policies--Hedging Activities' in the Statement of Additional
Information.
FOREIGN INVESTMENT RISK
The Intermediate Investment Grade Fund will invest in certain foreign
securities. Investments in obligations of foreign issuers and in foreign
branches of domestic banks involves somewhat different investment risks from
those affecting obligations of United States domestic issuers. There may be
limited publicly available information with respect to foreign issuers, and
foreign issuers are not generally subject to uniform accounting, auditing and
financial standards and requirements comparable to those applicable to domestic
companies. There may also be less government supervision and regulation of
foreign securities exchanges, brokers and issuers than in the United States.
Foreign securities markets have substantially less volume than domestic
securities exchanges, and securities of some foreign issuers are less liquid and
more volatile than securities of comparable domestic issuers. Brokerage
commissions and other transaction costs on foreign securities exchanges are
generally higher than in the United States. Interest paid by foreign issuers may
be subject to withholding and other foreign taxes that may decrease the net
return of foreign investments as compared to interest paid to the Intermediate
Investment Grade Fund by domestic companies. Additional risks include future
political and economic developments, the possibility that a foreign jurisdiction
might impose or change withholding taxes on income payable with respect to
foreign securities, the possible seizure, nationalization or expropriation of
the foreign issuer or foreign deposits and the possible adoption of foreign
governmental restrictions such as exchange controls.
(13) PROSPECTUS
<PAGE>
Since investments in foreign securities involve foreign currencies, the
value of their assets measured in United States dollars may be affected by
changes in currency rates and in exchange control regulations, including
currency blockage.
INTEREST RATE RISK
In general, the prices of debt securities vary inversely with interest rates. If
interest rates rise, debt security prices generally fall; if interest rates
fall, debt security prices generally rise. In addition, for a given change in
interest rates, longer-maturity debt securities fluctuate more in price (gaining
or losing more in value) than shorter-maturity debt securities, and generally
offer higher yields than shorter-maturity debt securities, all other factors,
including credit quality, being equal.
INVESTMENT
RESTRICTIONS
As a diversified series of a registered investment company, 75% of the total
assets of each Fund is subject to the following limitations: (a) a Fund may not
invest more than 5% of the value of its total assets in the securities of any
one issuer, except obligations of the United States Government and its agencies
and instrumentalities, and (b) a Fund may not own more than 10% of the
outstanding voting securities of any one issuer.
Each Fund also operates under certain investment restrictions that,
together with its investment objectives, are deemed fundamental policies--i.e.,
they may be changed only with the approval of the holders of a majority of a
Fund's outstanding shares.
A Fund may not (i) acquire any illiquid securities if as a result more than
15% of the market value of its net assets would be in investments that are
illiquid, (ii) borrow money, except from banks for extraordinary or emergency
purposes and then only in amounts up to 20% of the value of the Fund's total
assets (taken at cost at the time of borrowing), and except in connection with
permitted reverse repurchase agreements; or mortgage, pledge or hypothecate any
assets except in connection with any such borrowing in amounts up to 20% of the
value of the Fund's net assets at the time of such borrowing, (iii) purchase
securities while borrowings, as described in clause (ii) above, exceed 5% of its
total assets, (iv) purchase securities or other obligations of issuers of the
same industry if, after such purchase, the value of the Fund's investments in
such industry would exceed 25% of the value of its total assets, provided that
this restriction will not apply to purchases of securities issued or guaranteed
by the United States Government, its agencies or instrumentalities, (v) purchase
the securities of an issuer, if, after such purchase, the Fund owns more than
10% of the outstanding voting securities of such issuer, (vi) make loans, except
through certain means, (vii) purchase puts, calls, straddles, spreads or any
combination thereof or commodities except for hedging purposes, (viii) purchase
securities on margin or make short sales, except for certain hedging purposes,
(ix) invest in fixed time deposits except in certain circumstances, (x) issue
senior securities or (xi) act as an underwriter of securities.
For a more detailed discussion of the above investment restrictions, see
'Investment Restrictions' and 'Additional Information' in the Statement of
Additional Information.
PROSPECTUS (14)
<PAGE>
MANAGEMENT
OF THE FUNDS
DIRECTORS
Pursuant to the Articles of Incorporation and Bylaws of BNY Hamilton Funds,
Inc., the Directors decide matters of general policy and review the actions of
the Funds' investment adviser, administrator, distributor and other service
providers. The Statement of Additional Information contains the name and general
business experience of each director of BNY Hamilton Funds, Inc.
INVESTMENT ADVISER
The Bank of New York serves as the investment adviser (the 'Adviser') to each of
the Funds. The Adviser, which has its principal offices at 48 Wall Street, New
York, NY 10286, is New York's first bank, founded by Alexander Hamilton in 1784,
and is one of the largest commercial banks in the United States, having over $60
billion in assets at December 31, 1997. It is the leading retail bank in the
greater New York suburban area, having 363 branches at December 31, 1997. As of
December 31, 1997, the Adviser provided administrative or advisory services to
approximately $42 billion in assets.
William D. Baird, Vice President, Senior Fixed Income Analyst and Portfolio
Manager, joined The Bank of New York in 1993 and has 12 years of portfolio
management experience. He has managed the Intermediate Government Fund since
November 1997. In addition, Mr. Baird is the Bank of New York's structured
portfolio specialist and is responsible for developing and managing all indexed
and enhanced index bond products. Mr. Baird is also the Bank of New York's
strategist and specializes in government, mortgage-backed and asset-backed
security analysis. Prior to joining the Bank of New York, he managed structured
fixed income portfolios for a major insurance company and traded fixed income
securities and derivatives for an international bank.
Christopher M. Capone, Vice President, is responsible for the day-to-day
portfolio management for the Intermediate Investment Grade Fund. Mr. Capone has
been responsible for managing various fixed income investments for the Adviser
for the past ten years.
The Adviser manages the investments of each Fund and is responsible for all
purchases and sales of each Fund's portfolio securities. The Adviser's fee
accrues daily and is payable monthly at the annual rate of .50% of average daily
net assets for each Fund.
ADMINISTRATOR
BNY Hamilton Distributors, Inc. ('BNY Hamilton Distributors') serves as the
Funds' administrator (the 'Administrator') and assists generally in supervising
the operations of each Fund. BNY Hamilton Distributors is a Delaware corporation
organized to administer and distribute mutual funds; its offices are located at
3435 Stelzer Road, Columbus, Ohio 43219-3035.
The Administrator has agreed to provide facilities, equipment and personnel
to carry out administrative services for the Funds, including, among other
things, providing the services of persons who may be appointed as officers and
directors of BNY Hamilton Funds, Inc., overseeing the performance of the Funds'
transfer agent, supervising purchase and redemption
(15) PROSPECTUS
<PAGE>
orders (made via telephone and mail) and monitoring the Distributor's
compliance with the rules and regulations of the National Association of
Securities Dealers and federal and state securities laws.The Administrator will
also be responsible for coordinating and overseeing compliance by the Directors
with Maryland corporate procedural requirements (as BNY Hamilton Funds, Inc. is
a Maryland corporation; see 'Organization'). In addition, the Administrator's
duties include assisting in drafting and printing prospectuses and statements of
additional information, administering shareholder meetings, producing proxy
statements and annual and semi-annual reports, monitoring the Adviser's
compliance with the stated investment objective and restrictions of each Fund
and monitoring the custodian, fund accounting, transfer agency, administration,
distribution, advisory and legal services that are provided to the Funds.
The Administration Agreement permits the Administrator to delegate certain
of its responsibilities to other service providers. Pursuant to this authority,
the Administrator has delegated certain administrative functions to The Bank of
New York. The Bank of New York is not an affiliated person of BNY Hamilton
Distributors.
Each Fund pays annual administration fees, accrued daily and payable
monthly, of .20% of average daily net assets for each Fund.
DISTRIBUTOR
In addition to acting as the Administrator, BNY Hamilton Distributors will be
the exclusive underwriter and distributor of shares of each Fund (the
'Distributor'); its offices are located at 125 West 55 Street, New York, New
York 10019.
The Distributor makes a continuous offering of each Fund's shares and bears
the costs and expenses of distributing to selected dealers and prospective
investors copies of any prospectuses, statements of additional information and
annual and interim reports of the Funds (after such items have been prepared,
set in type and sent by the Funds at their expense to existing shareholders)
that are used in connection with the offering of shares, and the costs and
expenses of preparing, printing and distributing any other literature used by
the Distributor or furnished by it for use by selected dealers in connection
with the offering of each Fund's shares for sale to the public.
The Administrator (and Distributor) is a wholly-owned subsidiary of The
BISYS Group, Inc., whose other subsidiaries provide distribution and
adminstration services for other mutual fund groups.
PROSPECTUS (16)
<PAGE>
SUMMARY OF
SHAREHOLDER SERVICES
A Fund's telephone representative will be happy to answer any questions you may
have.
<TABLE>
<S> <C>
Telephone For Information Regarding
1-800-4BNY-FND o Any of the Funds' investment objectives and
(1-800-426-9363) policies
8 a.m. to 9 p.m., Eastern time o Opening an account
1-800-952-6276 o Current account balances
8 a.m. to 9 p.m., Eastern time o Shareholder address/telephone changes
</TABLE>
You should note that neither the Funds nor their service contractors will be
responsible for any loss or expense for acting upon telephone instructions that
they believe to be genuine. In attempting to confirm that telephone instructions
are genuine, the Funds will use procedures considered reasonable, as described
in 'Redemption of Shares' in the Statement of Additional Information. To the
extent that any of the Funds do not use reasonable procedures to form its belief
as to the genuineness of accountholders' instructions, it and/or its service
contractors may be responsible for such instructions that are fraudulent or
unauthorized.
The Funds want you to be kept current regarding the status of your account.
To assist you, the following statements and reports will be sent to you:
<TABLE>
<S> <C>
CONFIRMATION STATEMENTS After every transaction that affects your
account balance or your account
registration.
ACCOUNT STATEMENTS Quarterly, showing any activity during the
quarter, any income credited during the
quarter and the current value of your
account.
FINANCIAL REPORTS Every six months, one copy of most Fund
reports and year-end tax information will
be mailed to each household, regardless of
how many accounts are in the household.
</TABLE>
FUND AND OTHER
SHAREHOLDER SERVICES
CUSTODIAN AND FUND ACCOUNTING AGENT
The Bank of New York, 90 Washington Street, New York, New York 10286, serves as
each Funds' custodian. BNY Hamilton Funds, Inc. has also entered into a Cash
Management and Related Services Agreement with The Bank of New York pursuant to
which The Bank of New York, as custodian, will receive and disburse funds in
connection with the purchases and redemptions of each Fund's shares.
The Bank of New York also serves as the fund accounting agent for each Fund
with responsibility for calculating the net asset value of, and maintaining the
books and records of, each class of shares for both Funds.
(17) PROSPECTUS
<PAGE>
TRANSFER AGENT
BISYS Fund Services, Inc. ('BISYS'), P.O. Box 163310, Columbus, Ohio,
43216-3310, serves as each Fund's transfer agent. BISYS is a wholly-owned
subsidiary of The BISYS Group, Inc. As transfer agent, BISYS maintains the
records of each shareholder's account, answers shareholder inquiries concerning
accounts, processes purchases and redemptions of each Fund's shares, acts as
dividend and distribution disbursing agent and performs other shareholder
service functions.
DISTRIBUTION PLAN
The Directors have adopted a plan of distribution under Rule 12b-1 of the 1940
Act with respect to each class of each Fund (collectively, the '12b-1 Plans').
Under the 12b-1 Plans, the subject Fund may reimburse the Distributor for
expenses incurred in connection with the distribution of that Fund's shares.
Such distribution expenses will include expenses incurred in connection with
advertising and marketing such Fund's shares and expenses incurred in connection
with preparing, printing and distributing prospectuses for such Fund (except
those used for regulatory purposes or for distribution to existing shareholders
of each Fund) and in implementing and operating the 12b-1 Plans. To date, the
Directors have only implemented the 12b-1 Plans with respect to the Investor
Class of each Fund.
Under the 12b-1 Plans, reimbursements for distribution expenses may not
exceed .25% (annualized) of the average daily net assets of the relevant Fund,
excluding from such calculation, however, all shares acquired via a transfer of
assets from customer accounts at The Bank of New York. These amounts may be
reduced pursuant to undertakings by the Distributor. Payments for distribution
expenses under the 12b-1 Plans are subject to Rule 12b-1 under the 1940 Act.
Except for expenses related to telemarketing operations established for BNY
Hamilton Funds, Inc., it is presently contemplated that the Distributor will not
be reimbursed for any of its overhead expenses by a Fund class under its
respective 12b-1 Plan.
The 12b-1 Plans provide that if in any month the Distributor is due more
monies than are immediately payable because of the percentage limitation
described above, the unpaid amount will be carried forward from month to month
while the 12b-1 Plan is in effect until such time as it may be paid. Any carried
forward amounts will not be payable beyond the fiscal year during which the
amounts are accrued. No interest, carrying or other finance charge is borne by a
Fund class with respect to amounts carried forward past the fiscal year in which
it is incurred. As of December 31, 1997, there were no unreimbursed expenses
associated with either Fund's 12b-1 Plan.
PROSPECTUS (18)
<PAGE>
FEE WAIVERS
Except as noted in this Prospectus and the Statement of Additional Information,
the Funds' service contractors bear all expenses in connection with the
performance of their services and each Fund bears the expenses incurred in its
operation. From time to time during the course of the Funds' fiscal year, each
of the Administrator and the Adviser may voluntarily elect not to receive
payment of fees under their respective agreements described above and/or to
assume certain expenses of a Fund while retaining the ability to be reimbursed
by a Fund for such amounts prior to the end of the fiscal year. This will have
the effect of increasing yield to investors at the time such fees are not
received or amounts are assumed by the Administrator or the Adviser and
decreasing yield when such fees or amounts are reimbursed to the Administrator
or the Adviser. See the Fee Table for each class of shares for each Fund.
PURCHASE
OF SHARES
To purchase Institutional Shares in any Fund, contact your Bank of New York
representative for details.
The following table summarizes the types of investments available in each
of the Funds along with their respective minimum investment requirements. Unless
otherwise noted, all types of investments shown in the table are applicable to
Investor Shares of each Fund.
<TABLE>
<CAPTION>
MINIMUM INVESTMENT REQUIRED
----------------------------------------------------------
INITIAL ADDITIONAL
TYPE OF INVESTMENT INVESTMENT INVESTMENT
- -------------------------------------------------- --------------------------- ---------------------------
<S> <C> <C>
Regular Account................................... $ 2,000 $ 100
Regular Account with Automatic Investment
Program......................................... $ 500 $ 50
Regular Accounts for employees and retirees of The
Bank of New York and its affiliates, and
employees of each of the Administrator,
Distributor and their affiliates (1)............ $ 100 $ 25
Individual Retirement Account ('IRA')............. $ 250 $ 25
</TABLE>
- ------------------------------
(1) Available exclusively for employees and retirees of The Bank of New York and
its affiliates and for the employees of BNY Hamilton Distributors, Inc., and
their affiliates. The employees of The Bank of New York and its affiliates
may make investments through payroll deduction.
Institutional and Investor Shares of any of the Funds may be purchased
without sales commission at the net asset value per share next determined after
the purchase order and federal funds are received by the specific Fund. See 'Net
Asset Value'.
(19) PROSPECTUS
<PAGE>
The Distributor, from time to time, at its expense, will also provide
additional compensation to dealers in connection with sales of Investor
Shares of any of the Funds. Such compensation will include non-cash payments
which may take the form of (1) gift certificates, (2) tickets for entertainment
events, (3) trips, including the provision of travel arrangements and lodging at
vacation resorts and (4) merchandise. Dealers may not use sales of the Funds'
shares to qualify for this compensation to the extent such sales may be
prohibited by laws of any state or any self-regulatory agency, such as The
National Association of Securities Dealers, Inc. None of the aforementioned
compensation is paid for by any Fund or its shareholders.
INITIAL INVESTMENTS
Orders for purchase of a Fund's Investor Shares received by 4:00 P.M. (Eastern
time) on any Business Day and transmitted to the Fund's transfer agent by 4:00
P.M. (Eastern time) will be based on the next determined net asset value. (For
purposes of this Prospectus, 'Business Day' is defined to mean any day on which
both the New York Stock Exchange and the custodian are open for business.)
Investors will begin to earn dividends on the next Business Day after receipt of
the purchase order. On those days when the New York Stock Exchange or the
custodian closes early as a result of such day being a partial holiday or
otherwise, the right is reserved to advance the time on that day by which
purchase and redemption requests must be received.
Prospective investors may purchase a Fund's Investor Shares by check, by
federal funds wire, by bank wire, or by direct deposit. Additional investments
may also be made through an Automatic Investment Program. See the tables on the
following pages.
METHOD OF PURCHASE FOR INITIAL INVESTMENTS
BY CHECK
-- Complete and sign a New Account Application and mail it, together with a
check payable to the specific Fund, to: BNY Hamilton Funds, P. O. Box
163310, Columbus, Ohio 43216-3310.
-- Purchases made by check are not permitted to be redeemed until payment of
the purchase has been collected, which may take up to ten (10) Business
Days after purchase.
-- Purchases by check must be payable in United States dollars and drawn on
United States banks. THE FUNDS WILL NOT ACCEPT THIRD-PARTY CHECKS.
BY FEDERAL FUNDS WIRE
-- An investor desiring to purchase shares by wire should call the Transfer
Agent at 1-800-952-6276 and place a purchase order.
-- Have your bank wire federal funds to the BNY Hamilton Funds' bank account
(see below). In order to ensure prompt receipt by a Fund of a federal funds
wire, an investor should take the following steps:
PROSPECTUS (20)
<PAGE>
A. Instruct your bank to wire the specified amount to the specific Fund's
account as follows (be sure to have your bank include the name of the
specific Fund selected, and state that the wire is for a new account):
The Bank of New York
New York, NY 10286
ABA #021000018
BNY Hamilton Funds
DDA #8900275847
Attn.: (specific Fund selected)
Ref.: (your account number, your account name and taxpayer
identification number)
B. Complete the New Account Application and mail it to the appropriate address
shown in 'By Check' above.
-- Federal funds purchase orders will only be accepted on Business Days as
defined herein. Your bank may charge a service fee for wiring funds.
BY BANK WIRE
-- Follow the same procedure outlined under 'By Federal Funds Wire' above.
Your bank may charge a service fee for wiring funds.
BY DIRECT DEPOSIT
-- In certain circumstances, employees and retirees of The Bank of New York
and its affiliates may purchase Fund shares by having payments
automatically deposited into their specific Fund account.
-- Call 1-800-4BNY-FND (1-800-426-9363) for details.
METHOD OF PURCHASE FOR ADDITIONAL INVESTMENTS
BY CHECK
-- Make check payable to the specific Fund and send to: BNY Hamilton Funds,
Inc., P.O. Box 806, Newark, New Jersey 07101-0806. If possible, please
include the tear-off payment stub that accompanies a Fund's confirmation
statement.
BY FEDERAL FUNDS WIRE
-- Have your bank wire federal funds according to the instructions on the
previous page, except the wire should state that it is an additional
investment.
-- Please include your account number.
(21) PROSPECTUS
<PAGE>
BY AUTOMATIC INVESTMENT PROGRAM
-- You may arrange, through the Automatic Investment Program, for purchases
of Fund shares (minimum of $50) by direct debit from your account at any
domestic financial institution that is an Automated Clearing House member.
-- To elect this feature, please complete Section 7 on the new account
application.
-- See 'Purchase of Shares--Automatic Investment Program' or call
1-800-4BNY-FND (1-800-426-9363) for further details on this investment
option.
BY BANK WIRE
-- The procedure is identical to 'By Federal Funds Wire' above.
BY DIRECT DEPOSIT
-- Call 1-800-4BNY-FND (1-800-426-9363) for details.
-- Additional purchases will be processed in accordance with your
instructions.
AUTOMATIC INVESTMENT PROGRAM
You may arrange, through the Automatic Investment Program, for systematic
investments in your Fund account(s) in amounts of $50 or more (PROVIDED AN
INITIAL INVESTMENT OF $500 OR MORE HAS BEEN ESTABLISHED) by directly debiting
your account at the financial institution designated by you on the new account
application. At your option, your checking, NOW or bank money market account
designated by you will be debited in the specified amount, and Investor Shares
will be purchased, once a month, on either the first or fifteenth day, or twice
a month on both days. Only accounts maintained at a domestic financial
institution which permits automatic withdrawals and is an Automated Clearing
House member are eligible.
The Automatic Investment Program enables shareholders to invest a fixed
dollar amount at predetermined intervals, an investment strategy known as
'dollar cost averaging'. By applying this technique consistently over time,
investors usually purchase more shares during periods of low share prices and
fewer shares as share prices increase. You may also implement dollar cost
averaging on your own initiative or through other entities. To be effective,
dollar cost averaging should be carried out consistently for a sustained period
of time. You should understand, however, that purchases made through the
Automatic Investment Program will be made by the Fund without regard to share
price on the day of investment or to market trends. In addition, while you may
find dollar cost averaging to be beneficial, it will not prevent a loss if you
ultimately redeem your shares at a price that is lower than their purchase
price.
You may cancel this privilege or change the amount of purchase at any time
by mailing written notification to:
BNY Hamilton Funds
P.O. Box 163310
Columbus, OH 43216-3310
Notification will be effective seven days following receipt. The Fund may modify
or terminate this privilege at any time or charge a service fee, although no
such fee currently is contemplated.
PROSPECTUS (22)
<PAGE>
OTHER PURCHASE INFORMATION
Investors may purchase Investor Shares of any Equity Fund, Taxable Fixed Income
Fund, BNY Hamilton Intermediate Tax-Exempt Fund or Hamilton Classic Shares of
BNY Hamilton Money Fund offered by BNY Hamilton Funds, Inc., or a combination of
those Funds, in increments of 10% through an individual retirement account made
available by BNY Hamilton Funds, Inc., as described in the Minimum Investment
Required table earlier in this section. Please refer to a 'BNY Hamilton Funds
Individual Retirement Account' kit for details. Investors are also advised to
consult with their own legal counsel or tax adviser regarding these investments.
In the interest of economy and convenience and because of its operating
procedures, a Fund will not issue certificates representing ownership of either
class of its shares. All shares purchased will be confirmed to you and credited
to your account on the specific Fund's books maintained by the transfer agent.
You will have the same rights and ownership with respect to such shares as if
certificates had been issued.
To assure that checks are collected by a Fund, withdrawals of investments
made by check will not be permitted until payment for the purchase has been
received, which may take up to ten (10) Business Days after the date of
purchase. A Fund will charge a $15.00 processing fee for checks returned unpaid.
This charge may be deducted from the account of the investor that requested the
purchase. In addition, you may be prohibited or restricted from making future
purchases in any Fund offered by BNY Hamilton Funds, Inc.
Investors may also invest in any Fund offered by BNY Hamilton Funds, Inc.
by purchasing shares through registered broker-dealers, which are required to
effect the transaction at the net asset value next determined after receipt of
the order by the broker-dealer and are required to transmit such orders promptly
to the specific Fund. Broker-dealers who make purchases for their customers may
charge a fee for such services.
Federal regulations require that investors provide a social security or
taxpayer identification number upon opening or re-opening an account. Investors
should refer to the New Account Application for further information about this
requirement.
REDEMPTION
OF SHARES
To redeem Institutional Shares in any Fund, contact your Bank of New York
representative for details.
Investors may withdraw all or any portion of the Investor Shares in their
account at any time by redeeming such shares. INVESTORS SHOULD BE AWARE THAT,
UNLIKE A SAVINGS ACCOUNT, A REDEMPTION OF SHARES OF ANY OF THE FUNDS IS A
TAXABLE EVENT. CONSULT YOUR TAX ADVISER FOR THE POTENTIAL TAX SITUATIONS THAT
MAY ARISE AS A RESULT OF A REDEMPTION OF SHARES.
(23) PROSPECTUS
<PAGE>
METHOD OF REDEMPTION
A Fund will redeem Investor Shares at the next determined net asset value per
share. A Fund's net asset value per Investor Share will be determined on each
Business Day at 4:00 p.m. (Eastern time). The value of the shares redeemed may
be more or less than their original cost, depending upon a Fund's then-current
net asset value.
BY MAIL
-- Send your request to: BNY Hamilton Funds, P. O. Box 163310, Columbus, Ohio
43216-3310. (Be sure to include the name of the specific Fund and your
account number.)
BY TELEPHONE (1)
-- This option must have previously been elected. Call the specific Fund and
request that the redemption proceeds be mailed to the address listed in the
specific Fund's account records or wired to the investor's bank as listed
in the specific Fund's records.
BY SYSTEMATIC WITHDRAWAL
-- YOUR ACCOUNT MUST HAVE A VALUE OF $10,000 OR MORE.
-- The record owner of shares may request a declining balance withdrawal, a
fixed dollar withdrawal, a fixed share withdrawal, or a fixed percentage
withdrawal (based on the current value of shares in the account) on a
monthly, quarterly, semi-annual or annual basis.
-- Further information about establishing a Systematic Withdrawal Plan may be
obtained by calling 1-800-4BNY-FND (1-800-426-9363).
BY DRAFT
-- Redemption checks may be made payable to the order of any person in the
amount of $500 or more.
-- Redemption checks are free, but the transfer agent will impose a fee for
stopping payment of a redemption check at your request or if the transfer
agent cannot honor the redemption check because of insufficient funds or
any other valid reason.
-- SHARES FOR WHICH CERTIFICATES HAVE BEEN ISSUED MAY NOT BE REDEEMED BY
REDEMPTION CHECK.
- ------------------------------
(1) In times of drastic market conditions, the telephone redemption option may
be difficult to implement. If you experience difficulty in making a
telephone redemption, you may make your request by regular mail or express
mail and it will be implemented at the net asset value per share next
determined after the request is received.
PROSPECTUS (24)
<PAGE>
Each Fund will redeem its Investor Shares at the net asset value next
determined after the request is received in good order. 'Good order' means that
the request to redeem Investor Shares includes the following documentation: (i)
a letter of instruction or a stock assignment containing the account number and
taxpayer identification number(s) of the shareholder(s), specifying the number
of shares or dollar amount to be redeemed and signed by all registered owners of
the shares in the exact names in which they are registered; (ii) any required
signature guarantees, see 'Further Redemption Information' below; and (iii)
other supporting legal documents, if required, in the case of estates, trusts,
guardianships, custodianships, corporations, pension and profit-sharing plans
and other organizations. The Funds may adopt certain procedures as described in
'Redemption of Shares' in the Statement of Additional Information to verify
information provided with a redemption request. Shareholders who are uncertain
of the requirements for redemption should consult with a BNY Hamilton Funds,
Inc. representative by calling 1-800-952-6276.
DISCRETIONARY REDEMPTION BY A FUND
If the value of a shareholder's holdings falls below $500 because of a
redemption of Investor Shares, the shareholder's remaining shares may be
involuntarily redeemed after 60 days' written notice, unless the value of the
account is increased to $500 or more.
FURTHER REDEMPTION INFORMATION
Normally, a Fund will make payment for all Investor Shares redeemed under these
procedures within one Business Day of receipt of the request, but in no event
will payment be made more than seven days after receipt of a redemption request
in good order. Notwithstanding the foregoing, a Fund will not make payments to
investors redeeming Investor Shares that were purchased by check until payment
for the purchase has been collected, which may take up to ten (10) Business Days
after the date of purchase. At various times, the Funds may be requested to
redeem Investor Shares for which it has not yet received good payment. In such
circumstances, the Funds may delay the forwarding of proceeds for up to 15 days
or more until payment has been collected for the purchase of such Investor
Shares. A Fund reserves the right to suspend redemption or postpone the date of
redemption at times when the New York Stock Exchange is closed or when trading
on the Exchange is restricted, under certain emergency circumstances and during
periods when such suspension is permitted by the Securities and Exchange
Commission. See the Statement of Additional Information; 'Redemption of
Shares--Further Redemption Information'.
To change the address listed in a specific Fund's account records or the
name of the commercial bank or account designated to receive redemption
proceeds, an investor must send a written request to: BNY Hamilton Funds, P. O.
Box 163310, Columbus, Ohio 43216-3310. Such requests must be signed by each
shareholder, and, for requests to change the bank or account designated to
receive redemption proceeds, each signature must be guaranteed.
(25) PROSPECTUS
<PAGE>
EXCHANGE
OF SHARES
Shareholders purchasing shares directly from the Funds may exchange those shares
at the current net asset per share for other BNY Hamilton Funds which have a
similar class of shares, in accordance with the terms of the current prospectus
of the Fund being acquired, without charge. An exchange may be made so long as
the shares to be exchanged have a value of at least $500. Accordingly, when
establishing a NEW account by exchange, shares of the Fund being exchanged must
have a value at least equal to the minimum initial investment required by the
Fund into which the exchange is being made (currently $2,000 for all shares
available to retail investors for each Fund in BNY Hamilton Funds, Inc.). Shares
will be exchanged on the basis of relative net asset value per share.
Exchanges are in effect redemptions from one Fund and purchases of another
Fund and the usual purchase and redemption procedures and requirements are
applicable to exchanges. See 'Purchase of Shares' and 'Redemption of Shares'.
Before making any exchange, investors are advised to review the sections of this
Prospectus pertaining to the specific Fund or the appropriate sections of the
prospectuses for the other Funds in BNY Hamilton Funds, Inc.
Since an exchange is essentially a redemption from a specific Fund,
shareholders who exchange shares in any of the Funds for shares in any of the
other Funds may recognize a capital gain or loss for tax purposes. The Funds
reserve the right to discontinue, alter or limit the exchange privilege at any
time. At least 60 days' notice will be given to shareholders of any material
modification or termination. The exchange privilege will be honored only in
those states where such exchanges are legally permissible.
DIVIDENDS AND
DISTRIBUTIONS
The net investment income for each class of each Fund's shares will be declared
as dividends daily and paid monthly within five (5) Business Days after such
dividend is declared (usually by the 20th day of the month). Dividends and
distributions will be payable to shareholders of record at the time of
declaration. The Directors may revise a Fund's dividend policy without action by
the shareholders.
The net investment income of each class of a Fund for each Business Day
will be determined immediately prior to the determination of net asset value.
Net investment income for other days will be determined on the prior Business
Day. Shares of each class of a Fund will begin earning dividends on the next
Business Day after the date of the investment. See 'Purchase of Shares' and
'Redemption of Shares'.
Each of the Funds will distribute substantially all of any taxable net
long-term gains realized on investments to shareholders at least annually in
accordance with requirements under the Internal Revenue Code of 1986, as amended
(the 'Tax Code'), and other applicable statutory and regulatory requirements.
PROSPECTUS (26)
<PAGE>
DIVIDEND AND GAIN DISTRIBUTION OPTIONS
Each Fund will pay dividends and gain distributions, if any, in accordance with
the current option on each shareholder's account. If a shareholder does not
select a dividend and gain option, dividends and gains will be paid in
additional shares. Shareholders may choose to receive dividends in cash and any
gain distributions in shares or receive both dividends and any gain
distributions in cash. A shareholder can change the option selected on his or
her account by notifying the transfer agent in writing at least five (5)
Business Days prior to a dividend or gain distribution payment date. In the
event that a shareholder redeems all shares in an account between the record
date and the payable date, the value of the gain distributions declared and
payable will be paid in cash regardless of the existing election.
If you elect to receive distributions in cash, and the checks (1) are
returned and marked as 'undeliverable' or (2) remain uncashed for six months,
your cash election will be changed automatically and your future dividend and
capital gains distributions will be reinvested in the respective Fund at the per
share net asset value determined as of the date of payment of the distribution.
In addition, any undeliverable checks or checks that remain uncashed for six
months will be canceled and will be reinvested in the respective Fund at the per
share net asset value determined as of the date of cancellation.
NET ASSET
VALUE
Net asset value per share for each class of shares of each Fund will be
determined by subtracting from the value of a Fund's total assets attributable
to that class of shares the amount of its liabilities attributable to shares of
that class, and dividing the remainder by the number of its outstanding shares
of that class and rounding to the nearest one cent. Expenses, including the fees
payable to the Adviser and the Administrator, are accrued daily. See 'Net Asset
Value' in the Statement of Additional Information for more information on
valuation of portfolio securities for each Fund.
Each Fund computes the net asset value of each class of its respective
shares once daily on Monday through Friday, except that net asset value of a
particular class will not be computed on any day in which no orders to purchase
or redeem shares of that class have been received or on the holidays listed
under 'Net Asset Value' in the Statement of Additional Information. Each Fund
computes net asset value of each class of its shares as of the close of regular
trading of the New York Stock Exchange (normally 4:00 P.M., Eastern time).
(27) PROSPECTUS
<PAGE>
ORGANIZATION
BNY Hamilton Funds, Inc. is an open-end management investment company that
was organized as a Maryland corporation on May 1, 1992. The Articles of
Incorporation of BNY Hamilton Funds, Inc. currently permit the company to issue
20,000,000,000 shares of common stock, par value $.001 per share, which have
been allocated among the Funds described in this Prospectus as follows:
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
FUND COMMON STOCK AUTHORIZED
- ---------------------------------------------------------------------------------
<S> <C>
Intermediate Government Fund
Institutional Shares................................. 200,000,000
Investor Shares...................................... 200,000,000
Intermediate Investment Grade Fund
Institutional Shares................................. 200,000,000
Investor Shares...................................... 200,000,000
</TABLE>
The Directors may increase the number of shares each Fund is authorized to
issue without the approval of shareholders. The Directors also have the power to
designate one or more series or classes of shares of common stock and to
classify and reclassify any unissued shares with respect to such series of
classes.
Shareholders of each series of BNY Hamilton Funds, Inc. are entitled to one
vote for each share and to the appropriate fractional vote for each fractional
share. There is no cumulative voting and no Funds' shares have any preemptive or
conversion rights. All shareholders of a Fund will vote together as a single
class on matters affecting the Fund generally, including matters relating to the
Fund's investment advisory agreement, investment objective and fundamental
investment restrictions. Shareholders of a particular class of each Fund, will
vote separately on any matters relating only to that class, as appropriate. For
example, to the extent shareholder votes are necessary, holders of Investor
Shares will vote separately on matters relating to the class' distribution plan
under Rule 12b-1. Shares offered hereby must be fully paid upon issuance and
thereafter will be non-assessable by BNY Hamilton Funds, Inc., and the specific
Fund to which they belong. None of the series of BNY Hamilton Funds, Inc.
intends to hold meetings of shareholders annually. The Directors may call
meetings of shareholders for action by shareholder vote as may be required by
the 1940 Act, the Articles of Incorporation or Bylaws of BNY Hamilton Funds,
Inc. BNY Hamilton Funds, Inc., if requested to do so by the holders of at least
10% of the shares of all series aggregated as a class, will call a meeting of
shareholders for the purpose of voting upon the question of removal of a
director or directors and will assist in communications with other shareholders
as required by Section 16(c) of the 1940 Act. For further organization
information, including certain shareholder rights, see 'Description of Shares'
in the Statement of Additional Information.
TAXES
The following discussion of federal tax consequences is based on United States
tax laws in effect on the date of this Prospectus. These laws and regulations
are subject to change by legislative, judicial or administrative action.
Investors are urged to consult their own tax advisors with respect to
PROSPECTUS (28)
<PAGE>
specific questions as to federal taxes and with respect to the applicability of
state, local or foreign taxes. See 'Taxes' in the Statement of Additional
Information. Annual statements as to the federal tax status of distributions
will be mailed to shareholders shortly after the end of the taxable year.
Each Fund intends to qualify as a 'regulated investment company' under
Subchapter M of the Tax Code. As a regulated investment company, each Fund will
not be subject to federal income taxes on the net investment income and capital
gains distributed to shareholders, provided that it distributes annually at
least 90% of its net investment income and realized net short-term capital gains
in excess of net long-term capital losses.
Distributions of net investment income and realized net short-term capital
gains in excess of net long-term capital losses will be taxable to shareholders
of a Fund as ordinary income, whether such distributions are taken in cash or
reinvested in additional shares. Such distributions will not be eligible for the
dividends-received deduction.
Individual shareholders will be subject to federal income tax on
distributions of net long-term capital gains at a maximum rate of 28% if
designated as derived from a Fund's capital gains from property held for more
than one year and at a maximum rate of 20% if designated as derived from
property held for more than eighteen months.
Distributions of net long-term capital gains in excess of net short-term
capital losses are taxable to shareholders of a Fund as long-term capital gains
regardless of how long the shareholders have held shares and regardless of
whether taken in cash or reinvested in additional shares. Long-term capital
gains distributions are not eligible for the dividends-received deduction.
UNLESS A SHAREHOLDER INCLUDES ITS TAXPAYER IDENTIFICATION NUMBER (SOCIAL
SECURITY NUMBER FOR INDIVIDUALS) ON THE ACCOUNT APPLICATION AND CERTIFIES THAT
IT IS NOT SUBJECT TO BACKUP WITHHOLDING, A FUND MAY BE REQUIRED TO WITHHOLD AND
REMIT TO THE U.S. TREASURY 31% OF TAXABLE DISTRIBUTIONS AND OTHER REPORTABLE
PAYMENTS TO THE SHAREHOLDER. SHAREHOLDERS SHOULD BE AWARE THAT, UNDER
REGULATIONS PROMULGATED BY THE INTERNAL REVENUE SERVICE, A FUND MAY BE FINED UP
TO $50 ANNUALLY FOR EACH ACCOUNT FOR WHICH A CERTIFIED TAXPAYER IDENTIFICATION
NUMBER IS NOT PROVIDED. IN THE EVENT THAT SUCH A FINE IS IMPOSED WITH RESPECT TO
ANY UNCERTIFIED ACCOUNT IN ANY YEAR, A CORRESPONDING CHARGE MAY BE MADE AGAINST
THAT ACCOUNT.
ADDITIONAL INFORMATION
The Funds will send to their shareholders annual and semi-annual reports. The
financial statements appearing in the annual reports will be audited by
independent auditors. Shareholders will also receive confirmations of each
purchase and redemption and monthly statements, reflecting all account activity,
including dividends reinvested in additional shares or credited as cash. Written
inquiries about the Funds should be sent to BNY Hamilton Funds, P.O. Box 163310,
Columbus, Ohio 43216-3310.
A Fund may make historical performance information of either of its classes
available and may advertise total return and 30-day yield as those terms are
defined in the Statement of Additional Information under 'Performance Data'. All
performance figures will be based on historical earnings and are not intended to
indicate future performance. Performance information may be obtained by calling
the Distributor at 1-800-4BNY-FND (1-800-426-9363).
(29) PROSPECTUS
<PAGE>
APPENDIX A
The following chart shows the comparison of the predecessor of BNY Hamilton
Intermediate Investment Grade Fund and a comparable index. The average annual
total return figures for the predecessor of BNY Hamilton Intermediate
Investment Grade Fund have not been audited.
[BAR CHART]
<TABLE>
<CAPTION>
BNY HAMILTON LEHMAN INTERMEDIATE
INTERMEDIATE INVESTMENT GOVERNMENT
GRADE FUND CORPORATE INDEX
- ----------------------------------------------------------------------------
<S> <C> <C>
Average annual total return
after one year........... 1.81% 4.05%
Average annual total return
after five years......... 5.98% 6.52%
Average annual total return
after ten years.......... 6.88% 7.91%
</TABLE>
The performance results presented above are those of Bank of New York CTF
Intermediate Income Fund, a private trust fund advised by The Bank of New York.
These are not performance results of any class of BNY Hamilton Intermediate
Investment Grade Fund, and should not be interpreted as indicative of the future
performance of the Intermediate Investment Grade Fund.
The Bank of New York CTF Intermediate Income Fund's investment objective,
policies and strategies are substantially similar to those of the Intermediate
Investment Grade Fund, although, unlike the Intermediate Investment Grade Fund,
the Bank of New York CTF Intermediate Income Fund is not subject to certain
investment limitations, tax restrictions, diversification requirements and other
restrictions imposed by law upon mutual funds, which, if applicable to the Bank
of New York CTF Intermediate Income Fund, may have adversely affected
performance.
The Bank of New York CTF Intermediate Income Fund's performance results
reflect reinvestment of dividends. In addition, because the Bank of New York CTF
Intermediate Income Fund is not subject to advisory or administrative expenses
usually associated with
PROSPECTUS (30)
<PAGE>
mutual funds, the performance results have been adjusted to reflect the
deduction of the aggregate advisory, administrative and other expenses described
in this prospectus as being applicable to Investor Shares of BNY Hamilton
Intermediate Investment Grade Fund. Performance shown conforms to the standards
established by the Association for Investment Management and Research.
The Lehman Brothers Intermediate Government Corporate Index is an unmanaged
index generally considered representative of the intermediate-term bond market.
The Index does not take into account fees and expenses.
Performance for the Intermediate Government Fund can be found in its Annual
Report to Shareholders, available from the Fund's Distributor upon request and
without charge.
(31) PROSPECTUS
<PAGE>
[B/C C/R/C]
5/98 BNY-0091
<PAGE>
BNY HAMILTON TAX-EXEMPT FIXED INCOME FUNDS
125 West 55th Street
New York, New York 10019
For information call 1-800-426-9363 (1-800-4BNY-FND)
BNY Hamilton Funds, Inc. is a family of no-load mutual funds for which there are
no sales charges or exchange or redemption fees. This Prospectus describes two
(2) tax-exempt fixed income funds (individually, a 'Fund' and collectively, the
'Funds') offered by the BNY Hamilton Family of Funds.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
FUND OBJECTIVE FOR INVESTORS SEEKING
- ---------------------------------------------------------------------------------------
<S> <C> <C>
BNY HAMILTON To provide investors with income that Triple tax-free income,
INTERMEDIATE NEW is exempt from federal, New York moderate risk and relative
YORK State and New York City income taxes stability of principal
TAX-EXEMPT FUND while maintaining relative stability
of principal
- ---------------------------------------------------------------------------------------
BNY HAMILTON To provide income that is exempt from Tax-free income, moderate risk
INTERMEDIATE federal income taxes while and relative stability of
TAX-EXEMPT FUND maintaining relative stability of principal
principal
- ---------------------------------------------------------------------------------------
</TABLE>
INVESTMENTS IN EITHER FUND ARE NOT BANK DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR INSURED BY, THE BANK OF NEW YORK, AND THE SHARES IN EITHER FUND
ARE NEITHER INSURED NOR GUARANTEED BY THE UNITED STATES GOVERNMENT, THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENTAL AGENCY. INVESTMENTS IN EITHER FUND INVOLVE INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
This Prospectus sets forth concisely the information that a prospective investor
should know about the Funds noted in the chart above before investing and should
be retained for future reference. Additional information about the Funds or
other members of the BNY Hamilton Family of Funds has been filed with the
Securities and Exchange Commission in the Statement of Additional Information
for BNY Hamilton Funds, Inc., dated April 30, 1998. This information is
incorporated by reference and is available without charge upon request from the
Funds' distributor, BNY Hamilton Distributors, Inc., 125 West 55th Street, New
York, NY 10019, Attention: BNY Hamilton Funds, Inc. 1-800-4BNY-FND
(1-800-426-9363).
- --------------------------------------------------------------------------------
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 date of this Prospectus is April 30, 1998 5/98 BNY-0092
<PAGE>
[This page intentionally left blank]
<PAGE>
TABLE
OF
CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Fee Table 1
- --------------------------------------------------------------------
Financial Highlights 3
- --------------------------------------------------------------------
Investment Objectives and Policies 5
- --------------------------------------------------------------------
Description of Securities 6
- --------------------------------------------------------------------
Additional Investment Information and Risk Considerations 9
- --------------------------------------------------------------------
Investment Restrictions 17
- --------------------------------------------------------------------
Management of the Funds 18
- --------------------------------------------------------------------
Summary of Shareholder Services 20
- --------------------------------------------------------------------
Fund and Other Shareholder Services 20
- --------------------------------------------------------------------
Purchase of Shares 22
- --------------------------------------------------------------------
Redemption of Shares 26
- --------------------------------------------------------------------
Exchange of Shares 28
- --------------------------------------------------------------------
Dividends and Distributions 29
- --------------------------------------------------------------------
Net Asset Value 29
- --------------------------------------------------------------------
Organization 30
- --------------------------------------------------------------------
Taxes 31
- --------------------------------------------------------------------
Additional Information 32
- --------------------------------------------------------------------
Appendix A 33
- --------------------------------------------------------------------
Appendix B 34
- --------------------------------------------------------------------
</TABLE>
<PAGE>
FEE
TABLE
The following table illustrates the expenses an investor in either Fund will
incur. In addition, investments are subject to the annual fund operating
expenses (after expense limitations) set forth below.
<TABLE>
<CAPTION>
BNY HAMILTON
INTERMEDIATE BNY HAMILTON
NEW YORK INTERMEDIATE
TAX-EXEMPT FUND TAX-EXEMPT FUND
---------------------------------------------------
INSTITUTIONAL INVESTOR INSTITUTIONAL INVESTOR
SHARES SHARES SHARES SHARES
---------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION
EXPENSES:
Sales Load Imposed on
Purchases................... None None None None
Sales Load Imposed on
Reinvested Dividends........ None None None None
Deferred Sales Load........... None None None None
Redemption Fees............... None None None None
Exchange Fees................. None None None None
ANNUAL FUND OPERATING EXPENSES
(AFTER LIMITATIONS):
(AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS)
Management Fees (After
Limitations)................ .45% .45% .70% .70%
12b-1 Fees (After
Limitations)................ .00% .20% .00% .25%
Other Expenses................ .45% .50% .11% .20%
---------------------------------------------------
Total Fund Operating Expenses
(After Limitations)......... .90% 1.15% .81% 1.15%
---------------------------------------------------
---------------------------------------------------
EXAMPLE:
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:
</TABLE>
<TABLE>
<CAPTION>
BNY HAMILTON
INTERMEDIATE BNY HAMILTON
NEW YORK INTERMEDIATE
TAX-EXEMPT FUND TAX-EXEMPT FUND
----------------------------------------------------
INSTITUTIONAL INVESTOR INSTITUTIONAL INVESTOR
SHARES SHARES SHARES SHARES
----------------------------------------------------
<S> <C> <C> <C> <C>
1 year................... $ 9 $ 12 $ 8 $ 12
3 years.................. $ 29 $ 37 $ 26 $ 37
5 years.................. $ 50 $ 64 $ 45 $ 64
10 years................. $ 111 $140 $ 100 $140
</TABLE>
(1) PROSPECTUS
<PAGE>
This table is designed to assist investors in understanding the various
direct and indirect costs that an investor would bear. Long-term shareholders of
Investor Shares of either Fund may pay more than the economic equivalent of a
maximum front-end sales load imposed on purchases permitted by the National
Association of Securities Dealers, Inc. The Adviser and Administrator (each as
defined in 'Management of the Funds') have agreed to limit expenses of each Fund
to .90% and 1.15% of its average daily net assets of each Fund's Institutional
Shares and Investor Shares, respectively. Were expenses not so limited,
Management Fees would be .70% for each class of shares in BNY Hamilton
Intermediate New York Tax-Exempt Fund; 12b-1 fees would be .25% for the Investor
Shares of BNY Hamilton Intermediate New York Tax-Exempt Fund; and Total Fund
Operating Expenses would be 1.15% and 1.45% Shares of BNY Hamilton Intermediate
New York Tax-Exempt Fund, respectively. Management reserves the right to
implement or discontinue expense limitations at any time. See 'Fund and Other
Shareholder Services--Fee Waivers'.
For a description of contractual fee arrangements or the fees and expenses
included in Other Expenses, see 'Management of the Funds' and 'Fund and Other
Shareholder Services'. In connection with the example, please note that $1,000
is less than the generally applicable minimum initial investment required for
each of the Funds and that there are no redemption or exchange fees of any kind.
See 'Purchase of Shares' and 'Redemption of Shares'.
THE EXAMPLE IS HYPOTHETICAL; IT IS INCLUDED SOLELY FOR ILLUSTRATIVE
PURPOSES. IT SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
PERFORMANCE; ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. EXPENSES PAID
AS SHOWN ABOVE REFLECT ESTIMATES MADE BY THE FUNDS AS OF THE DATE OF THIS
PROSPECTUS.
PROSPECTUS (2)
<PAGE>
FINANCIAL
HIGHLIGHTS
The following selected financial data for shares of BNY Hamilton Intermediate
New York Tax-Exempt Fund was audited by KPMG Peat Marwick LLP, independent
accountants for the year ended December 31, 1997, and by Deloitte & Touche LLP,
independent accountants, for all other periods presented, whose reports thereon
appear in the Fund's annual report. This information should be read in
conjunction with the financial statements and related notes that also appear in
the Fund's Annual Report dated December 31, 1997 which is incorporated by
reference into the Statement of Additional Information.
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
<TABLE>
<CAPTION>
INSTITUTIONAL
SHARES INVESTOR SHARES
-------------- ------------------------------------------------------------------
FOR THE PERIOD FOR THE PERIOD
APRIL 1, 1997* AUGUST 10, 1992*
THROUGH YEAR ENDED DECEMBER 31, THROUGH
DECEMBER 31, ------------------------------------------------ DECEMBER 31,
1997 1997 1996 1995 1994 1993 1992
-----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at
beginning of
period.............. $ 10.16 $ 10.29 $ 10.34 $ 9.59 $ 10.37 $ 9.97 $ 10.00
-----------------------------------------------------------------------------------
INCOME FROM
INVESTMENT
OPERATIONS
Net investment
income.............. 0.31 0.39 0.40 0.39 0.39 0.38 0.15
Net realized and
unrealized gain
(loss) on
investments......... 0.36 0.23 (0.05) 0.75 (0.78) 0.40 (0.03)+
-----------------------------------------------------------------------------------
Total from
investment
operations........ 0.67 0.62 0.35 1.14 (0.39) 0.78 0.12
-----------------------------------------------------------------------------------
DIVIDENDS
Dividends from net
investment income... (0.31) (0.39) (0.40) (0.39) (0.39) (0.38) (0.15)
-----------------------------------------------------------------------------------
Net asset value at
end of period....... $ 10.52 $ 10.52 $ 10.29 $ 10.34 $ 9.59 $ 10.37 $ 9.97
-----------------------------------------------------------------------------------
-----------------------------------------------------------------------------------
TOTAL RETURN:++...... 6.69%** 6.19% 3.47% 12.08% (3.81)% 7.99% 1.18%**
RATIOS/SUPPLEMENTAL
DATA:
Net assets at end of
period (000's
omitted)............ $ 30,915 $10,368 $36,737 $40,931 $43,213 $55,871 $ 19,717
Ratio to average net
assets of:
Expenses, net of
waiver from The
Bank of New York
and
Administrator..... 0.90%*** 1.02% 0.90% 0.90% 0.85% 0.68% 0.60%***
Expenses, prior to
waiver from The
Bank of New York
and
Administrator..... 1.15%*** 1.32% 1.18% 1.20% 1.20% 1.30% 1.96%***
Net investment
income, net of
waiver from The
Bank of New York
and
Administrator..... 3.98%*** 3.88% 3.91% 3.89% 3.92% 3.74% 3.79%***
Portfolio turnover
rate.............. 21% 21% 22% 4% 18% 6% --
</TABLE>
- ------------------------------
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
+ The amount shown is not in accordance with the change in the aggregate gains
and losses of the portfolio securities for the period August 10, 1992 through
December 31, 1992 due to the timing of sales and repurchases of shares of the
Fund.
++ Total return does not consider the effect of the sales load for those
periods in which the sales load was in effect.
(3) PROSPECTUS
<PAGE>
Further information about the performance of BNY Hamilton Intermediate New
York Tax-Exempt Fund is contained in the Fund's annual report to
shareholders, which may be obtained from the distributor, BNY Hamilton
Distributors, Inc., upon request and without charge.
------------------------
The following selected financial data for shares of BNY Hamilton Intermediate
Tax-Exempt Fund was audited by KPMG Peat Marwick LLP, independent accountants,
whose report thereon appears in the Fund's annual report. This information
should be read in conjunction with the financial statements and related notes
that also appear in the Fund's Annual Report dated December 31, 1997 which is
incorporated by reference into the Statement of Additional Information.
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
<TABLE>
<CAPTION>
INSTITUTIONAL
SHARES INVESTOR SHARES
-------------- ---------------
FOR THE PERIOD FOR THE PERIOD
APRIL 1, 1997* MAY 1, 1997*
THROUGH THROUGH
DECEMBER 31, DECEMBER 31,
1997 1997
-------------------------------
<S> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.................... $ 10.00 $ 9.99
-------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income..................................... 0.33 0.27
Net realized and unrealized gain (loss) on investments.... 0.31 0.33
-------------------------------
Total from investment operations........................ 0.64 0.60
-------------------------------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income...................... (0.33) (0.27)
Distributions from capital gains.......................... (0.04) (0.04)
-------------------------------
Total dividends and distributions....................... (0.37) (0.31)
-------------------------------
Net assets at end of period............................... $ 10.27 $ 10.28
-------------------------------
-------------------------------
TOTAL RETURN:............................................. 6.50%** 6.08%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's omitted)............... $269,085 $ 194
Ratio to average net assets of:
Expenses................................................ 0.81%*** 1.15%***
Net investment income................................... 4.36%*** 3.98%***
Portfolio turnover rate................................... 30% 30%
</TABLE>
- ------------------------------
* Commencement of operations for the respective class of shares.
** Not annualized.
*** Annualized.
Further information about the performance of BNY Hamilton Intermediate
Tax-Exempt Fund is contained in the Fund's annual report to shareholders, which
may be obtained from the distributor, BNY Hamilton Distributors, Inc., upon
request and without charge.
PROSPECTUS (4)
<PAGE>
INVESTMENT OBJECTIVES
AND POLICIES
The investment objective of each Fund is stated below, together with the
policies each Fund will employ in its efforts to achieve its objectives. There
can be no assurance that either Fund will attain its investment objective.
INTRODUCTION
The Funds are open-end management investment companies (commonly known as mutual
funds) registered under the Investment Company Act of 1940 (the '1940 Act').
Each of the Funds will be considered a separate pool of assets with its own
distinctive investment objectives and policies, as described below.
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
(the 'Intermediate New York Tax-Exempt Fund')
The Intermediate New York Tax-Exempt Fund's investment objective is to provide
investors with income that is exempt from federal, New York State and New York
City income taxes while maintaining relative stability of principal. The
Intermediate New York Tax-Exempt Fund will seek to accomplish this objective by
investing primarily in bonds issued by New York State and the Commonwealth of
Puerto Rico and their respective authorities, agencies, instrumentalities and
political subdivisions, which bonds are exempt from federal, New York State and
New York City income taxes. (These type of bonds are hereafter referred to as
'Municipal Obligations'.)
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
(the 'Intermediate Tax-Exempt Fund')
The Intermediate Tax-Exempt Fund's investment objective is to provide income
that is exempt from federal income taxes while maintaining relative stability of
principal. A portion of income from the Intermediate Tax-Exempt Fund may also be
exempt from certain state and local income taxes. Shareholders will be notified
at the end of the calendar year what percentage, if any, of their income from
the Intermediate Tax-Exempt Fund is exempt from any income taxes in addition to
federal income taxes. In normal circumstances, the Intermediate Tax-Exempt Fund
will seek to accomplish this objective by investing primarily in Municipal
Obligations issued by states, territories and possessions of the United States
and the District of Columbia, which bonds are exempt from federal income taxes.
In an effort to manage interest rate risk and principal stability of the
Intermediate New York Tax-Exempt Fund's net asset value, the Intermediate New
York Tax-Exempt Fund will invest in a portfolio of debt instruments and/or
Municipal Obligations which, during normal market conditions, will have a dollar
weighted average maturity of no more than eight nor less than three years. For
the Intermediate Tax-Exempt Fund, the dollar weighted average maturity will be
no more than ten nor less than three years.
In addition, during normal conditions, each Fund will attempt to maintain a
ratio of 100% and, as a fundamental policy, at least 80%, of its net assets in
Municipal Obligations that are consistent with such Fund's specific investment
objective. If, due to market conditions or
(5) PROSPECTUS
<PAGE>
supply limitations, Municipal Obligations are not available, the Intermediate
New York Tax-Exempt Fund may temporarily invest up to 20% of its net assets in
fixed income securities that are subject to federal, as well as certain state
and local income taxes, and the Intermediate Tax-Exempt Fund may temporarily
invest up to 20% of its net assets in fixed income securities that are subject
to federal income taxes. These securities may include (i) securities issued or
guaranteed by the United States Government; (ii) commercial paper; (iii)
certificates of deposit of the 100 largest domestic banks; or (iv) corporate
debt. To provide liquidity, each Fund will invest a portion of its assets in
short-term Municipal Obligations related to its specific investment objective
and may temporarily increase investments in short-term Municipal Obligations for
defensive purposes if, in the opinion of the investment adviser, adverse market
conditions so warrant. For a further discussion of the types of securities that
each Fund may invest in for temporary defensive purposes and the associated
risks, see 'Additional Investment Information and Risk Considerations--Taxable
Investments' later in this Prospectus.
DESCRIPTION
OF SECURITIES
MUNICIPAL OBLIGATIONS
Each Fund will invest primarily in Municipal Obligations. For the Intermediate
Tax-Exempt Fund, Municipal Obligations include notes and bonds issued by or on
behalf of the political subdivisions, agencies, authorities and
instrumentalities of states, territories and possessions of the United States
and the District of Columbia. For the Intermediate New York Tax-Exempt Fund,
Municipal Obligations includes notes or bonds issued by or on behalf of the
political subdivisions, agencies, authorities and instrumentalities of New York
State and the commonwealth of Puerto Rico, the interest on which is exempt from
federal, and for Municipal Obligations issued by or on behalf of New York State
and its political subdivisions, agencies, authorities and instrumentalities,
from New York State and New York City income taxes as well. Such securities are
traded primarily in the over-the-counter market.
Tax-exempt bonds are issued to obtain funds for various public purposes,
including the construction of a wide range of public facilities such as
airports, bridges, highways, housing, hospitals, mass transportation, schools,
streets, water and sewer works, and gas and electric utilities. Tax-exempt bonds
also may be issued in connection with the refunding of outstanding obligations,
obtaining funds to lend to other public institutions and for general operating
expenses. Industrial development bonds ('IDBs'), which are considered tax-exempt
bonds if the interest paid thereon is exempt from federal income taxes, are
issued by or on behalf of public authorities to obtain funds to provide
privately operated facilities for business and manufacturing, housing and
pollution control, and for airport, mass transit, port and parking facilities.
Two principal classifications of tax-exempt bonds are 'general obligation'
and 'revenue'. General obligation bonds are secured by the issuer's pledge of
its full faith, credit and taxing power for the payment of principal and
interest. Revenue bonds are payable only
PROSPECTUS (6)
<PAGE>
from the revenues derived from a particular facility or class of facilities or,
in some cases, from the proceeds of a special excise tax or other specific
revenue source. Although IDBs are issued by municipal authorities, they are
generally secured by the revenues derived from payments of the industrial user.
The payment of the principal and interest on IDBs is dependent solely on the
ability of the user of the facilities financed by the bonds to meet its
financial obligations and the pledge, if any, of real and personal property so
financed as security for such payment.
Tax-exempt notes are of short maturity, generally one year or less. They
include such securities as Tax Anticipation Notes, Revenue Anticipation Notes,
Bond Anticipation Notes and Construction Loan Notes. Tax-exempt commercial paper
consists of short-term obligations generally having a maturity of less than nine
months.
Interest earned from certain tax-exempt securities (including certain IDBs)
that are private activity bonds, as defined in the Internal Revenue Code of
1986, as amended (the 'Tax Code'), is treated as a preference item for purposes
of the alternative minimum tax. In the event that a Fund invests in such
securities, no more than 20% of its net assets would be invested in such
securities, together with securities the interest on which is subject to federal
and, where applicable, state and local income tax.
RISK FACTORS REGARDING MUNICIPAL OBLIGATIONS
Investors should note that either general obligation or revenue bonds may be
adversely affected by local political and economic conditions and developments
within a particular state that adversely affect issuers of such tax-exempt
securities. Adverse conditions in a state's significant industry could have a
correspondingly adverse effect on specific issuers within the state or on
anticipated revenue of the issuing state; conversely an improving economic
outlook for a significant industry may have a positive effect on such issuers or
revenue. Other factors that could affect a tax-exempt security include the
change in a state's economy (for example from an industrial or agricultural
based economy to a service based economy); demographic factors such as
population growth or decline and foreign immigration, ecological or
environmental issues unique to a particular industry or area within the state
and statutory limitations on the state's ability to increase taxes.
SPECIAL RISK FACTORS REGARDING NEW YORK STATE MUNICIPAL OBLIGATIONS
Investors in the Intermediate New York Tax-Exempt Fund should consider carefully
the special risks inherent in investments in Municipal Obligations of New York
issuers. These risks result from the financial condition of New York State,
certain of its public bodies and municipalities and New York City. Beginning in
early 1975, New York State, New York City, and other entities faced serious
financial difficulties which jeopardized the credit standing and impaired the
borrowing abilities of such entities and contributed to high interest rates on,
and lower market prices for, debt obligations issued by them. A recurrence of
such financial difficulties or a failure of certain financial recovery programs
could result in defaults or declines in the market values of various Municipal
Obligations in which the Intermediate New York Tax-Exempt Fund may invest. If
there should be a default or other financial crisis relating to New York State,
(7) PROSPECTUS
<PAGE>
New York City, a State or City agency, or other municipality, the market
value and marketability of outstanding Municipal Obligations in the
Intermediate New York Tax-Exempt Fund portfolio and the interest income to the
Fund could be adversely affected. Moreover, the effects of the Federal Tax
Reform Act of 1986 and conforming State tax legislation have added substantial
uncertainty to estimates of New York State's tax revenues. In 1991, Moody's
Investors Services, Inc. ('Moody's') and Standard and Poor's Ratings Group
('S&P') downgraded certain obligations backed by New York State and have placed
other bonds on a watch list for possible future downgrade. Potential recurring
revenue shortfalls in future fiscal years may adversely affect New York State.
The foregoing is only a summary and is based on information from statements
relating to securities offerings of New York issuers. A more detailed
description of special factors affecting investments in Municipal Obligations of
which investors should be aware is set forth under 'Special Considerations
Relating to Investments in New York Municipal Obligations' in the Statement of
Additional Information.
The Intermediate New York Tax-Exempt Fund is classified as a
non-diversified series of a registered investment company so that it is not
limited by the 1940 Act as to the proportion of its assets that it may invest in
the obligations of a single issuer. This classification may cause the
Intermediate New York Tax-Exempt Fund to be more susceptible to adverse
economic, political or regulatory developments affecting a single issuer than
would be the case if its investments were required to be diversified across the
Municipal Obligations of many issuers.
QUALITY INFORMATION
The Funds will limit their investments to investment grade Municipal
Obligations, which are Municipal Obligations rated in one of the four highest
investment rating categories by Moody's or S&P. Securities rated in the lowest
of these investment grade debt categories (Baa by Moody's and BBB by S&P) are
normally considered to have adequate payment protection parameters, although
adverse conditions are more likely to lead to a weakened capacity to pay
principal and interest, as compared to securities rated in the three higher
categories. Securities rated Baa or BBB are characterized by Moody's and S&P as
investment grade but are considered by Moody's to have speculative
characteristics as well. The Funds may also invest in short-term municipal
obligations rated MIG-1 or MIG-2 by Moody's or SP-1+ or SP-1 by S&P. If market
conditions warrant, a Fund may invest in tax-exempt commercial paper rated
Prime-1 by Moody's or A-1 by S&P. In the event that a security held by a Fund
has its ratings dropped below the tolerance described above, the decision
whether to sell or to retain such security will be at the discretion of the
investment adviser.
For a further description of securities ratings, see 'Appendix
A--Description of Securities Ratings' in the Statement of Additional
Information.
PROSPECTUS (8)
<PAGE>
ADDITIONAL INVESTMENT
INFORMATION AND
RISK CONSIDERATIONS
The following paragraphs describe other types of securities transactions in
which the Funds may engage. Generally, the following types of securities and
transactions involve more risk than those discussed above in 'Description of
Securities'.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
The Funds may purchase securities on a when-issued or delayed delivery basis.
Delivery of and payment for these securities may take as long as a month or more
after the date of the purchase commitment. The value of these securities is
subject to market fluctuation during this period and no interest or income is
accrued until settlement. A Fund will maintain with its custodian a separate
account with a segregated portfolio of securities in an amount at least equal to
these commitments. When entering into a when-issued or delayed delivery
transaction, a Fund will rely on the other party to consummate the transaction;
if the other party fails to do so, a Fund may be disadvantaged. It is the
current policy of the Funds not to enter into when-issued commitments exceeding
in the aggregate 25% of the market value of a Fund's total assets less
liabilities other than the obligations created by these commitments.
REPURCHASE AGREEMENTS
The Funds may enter into repurchase agreements with brokers, dealers or banks
that meet the credit guidelines established by the Board of Directors (the
'Directors') of BNY Hamilton Funds, Inc. In a repurchase agreement, a Fund buys
a security from a seller that has agreed to repurchase it at a mutually agreed
upon date and at a price reflecting the interest rate effective for the term of
the agreement. The term of the agreement is usually from overnight to one week.
A repurchase agreement may be viewed as a fully collateralized loan of money by
a Fund to the seller. The Fund always receives, as collateral, securities with a
market value at least equal to purchase price plus accrued interest and this
value is maintained during the term of the agreement. If the seller defaults and
the collateral value declines, the lending Fund might incur a loss. If
bankruptcy proceedings are commenced with respect to the seller, the Fund's
realization upon the collateral may be delayed or limited. Investments in
certain repurchase agreements and certain other investments that may be
considered illiquid are limited as set forth under 'Investment Restrictions'.
LOANS OF PORTFOLIO SECURITIES
Subject to applicable investment restrictions, each Fund is permitted to lend
its securities. These loans must be secured continuously by cash, U.S.
Government securities or other liquid high-grade short-term debt obligations in
an account segregated by the custodian or by a letter of credit at least equal
to the market value of the securities loaned plus accrued interest or income.
For more information, see 'Investment Objectives and Policies--Loans of
Portfolio Securities' in the Statement of Additional Information.
(9) PROSPECTUS
<PAGE>
REVERSE REPURCHASE AGREEMENTS
The Funds are permitted to enter into reverse repurchase agreements. In a
reverse repurchase agreement, a Fund sells a security and agrees to repurchase
it at a mutually agreed upon date and at a price reflecting the interest rate
effective for the term of the agreement. It may also be viewed as the borrowing
of money by the Fund. A Fund will not invest the proceeds of a reverse
repurchase agreement for a period which exceeds the duration of the reverse
repurchase agreement. Neither Fund may enter into reverse repurchase agreements
exceeding in the aggregate one-third of the market value of its total assets,
less liabilities other than the obligations created by reverse repurchase
agreements. Each Fund will establish and maintain with its custodian a separate
account with a segregated portfolio of liquid assets consisting of cash, U.S.
Government securities or other liquid high-grade debt securities in an amount at
least equal to its purchase obligations under its repurchase agreements.
Reverse repurchase agreements involve the risk that the market value of the
securities retained by the relevant Fund may decline below the price of the
securities it has sold but is obligated to repurchase under the agreement. In
the event the buyer of securities under a reverse repurchase agreement files for
bankruptcy or becomes insolvent, a Fund's use of proceeds from the agreement may
be restricted pending a determination by the other party or its trustee or
receiver whether to enforce the Fund's obligation to repurchase the securities.
INVESTMENT COMPANY SECURITIES
The Funds may invest in the securities of other investment companies to the
extent permitted under the 1940 Act. These limits require that, as determined
immediately after a purchase is made, (i) not more than 5% of the value of a
Fund's total assets will be invested in the securities of any one investment
company, (ii) not more than 10% of the value of such Fund's total assets will be
invested in securities of investment companies as a group and (iii) not more
than 3% of the outstanding voting stock of any one investment company will be
owned by such Fund. As a shareholder of another investment company, a Fund would
bear, along with other shareholders, its pro rata portion of the other
investment company's expenses, including advisory fees. These expenses would be
in addition to the advisory and other expenses that such Fund bears directly in
connection with its own operations.
TAXABLE INVESTMENTS
Each Fund will attempt to invest 100% of its assets in Municipal Obligations;
however, either Fund is permitted to invest up to 20% of the value of its total
assets in securities, the interest income on which is subject to federal and,
where applicable, New York State and New York City income tax. If, in adverse
market conditions, a Fund's investment adviser determines, in its judgment, that
Municipal Obligations satisfying the Fund's investment objective are not
available, the Fund may, for defensive purposes only, temporarily invest more
than 20% of its net assets in debt securities, the interest on which is subject
to federal, and where applicable, New York State and New York City income taxes.
Investments in taxable securities will be substantially in securities
issued or guaranteed by the United States Government (such as bills, notes and
bonds), its agencies, instrumentalities or
PROSPECTUS (10)
<PAGE>
authorities, highly rated corporate debt securities (rated AA or better by S&P,
or Aa or better by Moody's), prime commercial paper (rated A-1+ by S&P or P-1 by
Moody's) and certificates of deposit of the 100 largest domestic banks in terms
of assets, which are subject to regulatory supervision by the United States
Government or state governments and the 50 largest foreign banks in terms of
assets with branches or agencies in the United States. Investments in
certificates of deposit of foreign banks and foreign branches of United States
banks involve certain risks not generally associated with investments in
domestic banks. While domestic banks are required to maintain certain reserves
and are subject to other regulations, such requirements and regulations may not
apply to foreign branches. Investments in foreign banks and branches may also be
subject to other risks, including future political and economic developments,
the seizure or nationalization of foreign deposits and the establishment of
exchange controls or other restrictions.
PUTS
The Funds may purchase without limit Municipal Obligations together with the
right to resell them at an agreed price or yield within a specified period prior
to maturity. This right to resell is known as a 'put'. The aggregate price paid
for a security with a put may be higher than the price that would otherwise be
paid. Consistent with each Fund's investment objectives and subject to the
supervision of the Directors of BNY Hamilton Funds, Inc., the purpose of this
practice is to permit a Fund's portfolio to be fully invested in tax-exempt
securities while maintaining the necessary liquidity to purchase securities on a
when-issued basis, to meet unusually large redemptions, to purchase at a later
date securities other than those subject to the put and to facilitate the
investment adviser's ability to manage the portfolio actively. The principal
risk of puts is that the put writer may default on its obligation to repurchase.
The Fund's investment adviser will monitor each writer's ability to meet its
obligations under puts.
The amortized cost method will be used by each Fund to value Municipal
Obligations with maturities of less than 60 days because the Directors have
determined that this method of valuation will provide an accurate estimate of
market value; when these securities are subject to puts separate from the
underlying securities, no value is assigned to the puts. The cost of any such
put is carried as an unrealized loss from the time of purchase until it is
exercised or expires. See 'Investment Objectives and Policies' in the Statement
of Additional Information for valuation procedure if a Fund invests in Municipal
Obligations with maturities of 60 days or more that are subject to separate
puts.
PRIVATELY PLACED AND CERTAIN UNREGISTERED SECURITIES
Each Fund may acquire, in privately negotiated transactions, restricted
securities which cannot be offered for public sale in the United States without
first being registered under the Securities Act of 1933, as amended (the
'Securities Act'). The price a Fund pays for these securities, or receives upon
resale, may be lower than the price the Fund would pay or receive for similar
securities with a more liquid market. Accordingly, the valuation of these
securities by a Fund will reflect any limitations on their liquidity. (As a
matter of policy, each Fund may invest up to 25% of its total assets in
Municipal Obligations issued as part of privately negotiated
(11) PROSPECTUS
<PAGE>
transactions between one issuer and one or more purchasers.) Each Fund may
also purchase certain unregistered securities sold to institutional investors
under Rule 144A of the Securities Act ('Rule 144A Securities'). Rule 144A
Securities that have a readily available market may be deemed to be liquid for
purposes of the Fund's 15% limitation on investments in illiquid securities
described below. The investment adviser will monitor the liquidity of such
restricted securities under the supervision of, and pursuant to guidelines
established by, the Directors. In establishing these guidelines, the Directors
take into account factors such as trading activity, availability of reliable
price information, and other relevant information. Investing in Rule 144A
Securities could have the effect of increasing the level of a Fund's illiquidity
to the extent that qualified institutional buyers become, for a time,
uninterested in purchasing these securities. Acquisition by a Fund of illiquid
investments (any investment that cannot be disposed of within three (3) Business
Days in the normal course of business at approximately the amount at which it
was valued by a Fund) is subject to the 15% limitation described under
'Investment Restrictions'.
HEDGING
Hedging is a means of transferring risk that an investor does not wish to assume
during an uncertain market environment. The Funds are permitted to enter into
these transactions solely (a) to hedge against changes in the market value of
portfolio securities and against changes in the market value of securities
intended to be purchased, or (b) to close out or offset existing positions.
Hedging activity in the Funds may include selling futures contracts on debt
securities and indexes of debt securities and purchasing or writing (selling)
options on these futures, on debt securities and on indexes of debt securities
traded on registered securities exchanges and contract markets. All hedging
transactions must be appropriate for reduction of risk; they cannot be for
speculation.
Under regulations of the Commodity Exchange Act of 1936, as amended (the
'Commodity Exchange Act'), an investment company registered under the 1940 Act
is exempt from the definition of 'commodity pool operator', and therefore not
subject to regulation under the Commodity Exchange Act, provided that the entity
agrees to restrict its investments in commodity futures and commodity options
contracts to (i) bona fide hedging transactions within the meaning of the
Commodity Futures Trading Commission's regulations, without any limitation on
quantity, and (ii) other futures and options transactions in which the aggregate
initial margin and premiums do not exceed 5% of the liquidation value of the
entity's portfolio after taking into account unrealized profits and unrealized
losses on any such contracts. The Funds will only use commodity futures and
commodity options contracts in a manner consistent with these requirements.
FINANCIAL FUTURES CONTRACTS AND OPTIONS ON FUTURES, DEBT SECURITIES AND INDEXES
OF DEBT SECURITIES
The Funds may (a) sell futures contracts on debt securities and indices of debt
securities and (b) purchase or write (sell) options on these futures, on debt
securities and on indexes of debt
PROSPECTUS (12)
<PAGE>
securities traded on registered securities exchanges and contract markets. The
Funds may enter into these transactions with respect to Municipal Obligations
and non-municipal debt securities.
Presently, futures contracts are available in several types of fixed income
securities, including U.S. Treasury bonds and notes, Government National
Mortgage Association modified pass-through mortgage-backed securities,
three-month U.S. Treasury bills and bank certificates of deposit.
When a futures contract is entered into, each party deposits with a broker
or in a segregated custodial account a good faith deposit of approximately
1 1/2-2% of the contract amount, called the 'initial margin'. Additionally,
during the term of the contract, the amount of the deposit is adjusted daily
based on the current value of the futures contract by payments of 'variation
margin' to or from the broker or segregated account.
Although most interest rate futures contracts call for making or taking
delivery of the underlying securities, these obligations are typically canceled
or closed out before the scheduled settlement date. The closing is accomplished
by purchasing (or selling) an identical futures contract to offset a short (or
long) position. Such an offsetting transaction cancels the contractual
obligations established by the original futures transaction. Other financial
futures contracts call for cash settlements rather than delivery of securities.
If the price of the offsetting futures transaction varies from the price of the
original futures transaction, the hedger will realize a gain or loss
corresponding to the difference. That gain or loss will tend to offset the
unrealized loss or gain on the hedged securities position, but may not always or
completely do so.
Financial futures contracts obligate the seller to deliver a specific type
of security, at a specified time for a specified price. The contracts may be
satisfied by actual delivery of the securities or by an offsetting transaction.
There are risks associated with the use of futures contracts for hedging
purposes. In certain market conditions, as with rising interest rates, futures
contracts may not completely offset a decline in value of portfolio securities.
It may not always be possible to execute a buy or sell order at the desired
price or to close out an open position due to market conditions, limits on open
positions, and/or daily price fluctuation limits. Changes in market interest
rates may differ substantially from those anticipated when hedge positions were
established. If a Fund has purchased futures to hedge against rising interest
rates and interest rates decline, the value of the Fund's portfolio will
increase, but at least part of the benefit of the increase will be lost because
of losses in the futures position. A Fund may have to sell securities to meet
daily maintenance margin requirements. The risk of loss to a Fund is
theoretically unlimited when an uncovered futures contract is sold because there
is an obligation to make delivery unless the contract closed out, regardless of
fluctuations in the price of the underlying security.
Each Fund intends to engage in transactions in futures contracts and
options on futures contracts as a hedge against changes, resulting from market
conditions, in the value of securities which are held in the Fund's portfolio or
which the Fund intends to purchase. In accordance with current Commodity Futures
Trading Commission ('CFTC') regulations, a Fund will not enter into any
financial futures contract or purchase related options (as defined in the CFTC
regulations) if immediately thereafter, the aggregate initial margin for its
outstanding futures contracts and premiums paid for such options would exceed 5%
of the fair market value of its
(13) PROSPECTUS
<PAGE>
total assets. In addition, neither Fund will enter into any financial futures
contract or purchase related options (as defined in the CFTC regulations) if
immediately thereafter the sum of initial and variation margins on its
outstanding futures contracts, together with premiums paid on options thereon,
would exceed 20% of its total assets.
When either Fund attempts to hedge its portfolio by selling an interest
rate futures contract, purchasing a put option thereon, or by writing a call
option thereon, it will own an amount of United States Government securities
corresponding to the open futures or option position. With respect to long
positions assumed by a Fund, the Fund will segregate with its custodian, or in a
margin account with a broker, an amount of liquid assets consisting of cash,
U.S. Government securities or other liquid high-grade debt securities permitted
by CFTC regulations equal to the market value of the futures contracts and
thereby insure that the use of futures contracts is unleveraged.
The Funds may purchase call options and write (sell) put options on debt
securities to close out open option positions, purchase put options to protect
its holding from a decline in market value, and write call options. The Funds
may also purchase put options and write call options on futures contracts that
are traded on a United States exchange or board of trade and enter into closing
transactions with respect to these options. Either Fund may use options on
futures contracts under the same conditions it uses put and call options on debt
securities. The effect of a futures contract may also be created by simultaneous
purchase of a put option and sale of a call option on the same security. When a
Fund purchases a put option or call option, the maximum risk of loss is the
price of the option purchased. The use of options as a hedge rather than
financial futures contracts may result in partial hedges because of the limits
inherent in the exercise prices. Neither Fund will invest more than 5% of its
net assets in premiums on put options.
The Funds may utilize futures contracts on municipal bond indices or
related put and call options on these index contracts. The Funds' strategies in
employing these contracts would be similar to the strategies applicable to
futures and options contracts generally. The Funds may also buy put options and
sell call options on municipal bond indices. The Funds may also purchase put
options or write (sell) call options on non-municipal debt securities. In the
event that options on municipal debt securities become available, the Funds will
consider purchasing or selling these options.
The hedging activities of the Funds are subject to several additional
restrictions. A Fund's ability to engage in hedging activities may be limited by
certain income tax considerations. See 'Taxes' in the Statement of Additional
Information.
To the extent a Fund uses hedging instruments that do not involve specific
portfolio securities, offsetting price changes between the hedging instruments
and the securities being hedged will not always be possible, and the market
value fluctuations of the portfolio may not be completely eliminated. When using
hedging instruments that do not specifically correlate with securities in a
Fund's portfolio, the investment adviser will attempt to create a very closely
correlated hedge.
Hedging activities based on non-municipal debt securities or indexes may
not correlate as closely to a Fund's portfolio as hedging activities based on
municipal debt securities or indexes.
PROSPECTUS (14)
<PAGE>
Less closely correlated hedges are likely to occur if a Fund hedges municipal
securities with a futures contract on United States Government obligations,
other non-municipal securities or an index that does not include municipal
securities. This type of hedging activity may be especially useful where closely
correlated hedging activities based on municipal securities or indexes are not
available.
The Funds may purchase put options on interest rate futures contracts that
are traded on United States commodity exchanges, and write (i.e., sell) put and
call options on such futures contracts. The Funds only intend to engage in
options in futures contracts for bona fide hedging purposes in compliance with
CFTC regulations. An option on a futures contracts gives the purchaser the
right, but not the obligation, to assume a position in a futures contract (which
position may be a long or short position) at a specified exercise price at any
time during the option exercise period. The writer of the option is required
upon exercise to assume an offsetting futures position (which position may be a
long or short position). Upon exercise of the option, the assumption of
offsetting futures positions by the writer and holder of the option will be
accompanied by delivery of the accumulated balance in the writer's futures
margin account that represents the amount by which the market price of the
futures contract, at exercise, exceeds, in the case of a call, or is less than,
in the case of a put, the exercise price of the option on the futures contract.
Currently, options can be purchased or written with respect to futures contracts
on United States Treasury bonds and United States Treasury notes on The Chicago
Board of Trade.
When a Fund hedges its portfolio by purchasing a put option or writing a
call option on a futures contract, it will own a long futures position or an
amount of high-grade debt securities corresponding to the open option position.
When a Fund writes a put option on a futures contract, it may, rather than
establish a segregated account, sell the futures contract underlying the put
option or purchase a similar put option. In instances involving the purchase of
a call option on a futures contract, a Fund will deposit in a segregated account
with its custodian an amount in cash, cash equivalents or liquid, high-grade,
fixed-income debt securities equal to the market value of the obligation
underlying the futures contract, less any amount held in the initial variation
margin accounts.
The holder or writer of an option may terminate its position by selling or
purchasing an option of the same series. There is no guarantee that such closing
transactions can be effected at any particular time or at all.
A Fund will be required to deposit initial and variation margin with
respect to put and call options on futures contracts written by it pursuant to
the Fund's futures commissions merchants' requirements, which are similar to
those applicable to interest rate futures contracts described above.
MUNICIPAL BOND INDEX FUTURES CONTRACTS
Futures contracts on municipal bond indexes began trading on the Chicago Board
of Trade in 1985. These contracts, which provide for each settlement rather than
delivery of securities, are based on the Bond Buyer Municipal Bond Index, an
index of 40 actively traded municipal bonds. To make the index as representative
as possible of price trends in the municipal securities market, twice a month
new issues are added to the index and an equal number of the
(15) PROSPECTUS
<PAGE>
least actively traded issues are dropped from the index. Each bond in the index
is priced daily by a group of five brokers.
Municipal bond index contracts are designed to provide a way to hedge
municipal bond portfolios, since prices of existing futures on taxable
securities do not always correlate well with municipal bond prices. Because the
municipal bond index contract should correlate better with a Fund's price
changes than Treasury bond futures contracts, the investment adviser expects to
do most of its hedging using municipal bond index contracts. However, there may
be times when the investment adviser believes that Treasury bond contracts
correspond well with municipal bond prices are trading at prices that makes
hedging with these contracts less expensive than hedging with municipal bond
index contracts. Accordingly, the Funds intend to use both Treasury bond and
municipal bond index contracts for hedging purposes.
RISKS OF FUTURES TRANSACTIONS
The Funds' successful use of futures contracts and options thereon will depend
on the ability of their investment adviser to predict movements in interest
rates and other factors affecting markets for securities, and upon the degree of
correlation between prices of the futures contracts and the prices of the
securities being hedged. As a result, even a correct forecast of interest rate
changes may not result in a successful hedging transaction. Although futures
contracts and options thereon may limit exposure to loss, they may also limit a
Fund's potential for capital gains. For example, if a Fund has hedged against
the possibility of an increase in interest rates which would adversely affect
the price of securities in its portfolio and prices of such securities increase
instead, it will lose part or all of the benefit of the increased value of its
securities because it will have offsetting losses in its futures positions. In
addition, in such situations, if a Fund has insufficient cash to meet daily
variation margin requirements, it may have to sell securities to meet such
requirements. Such sales of securities may be, but will not necessarily be, at
increased prices which reflect the rising market. A Fund may have to sell
securities at a time when it is disadvantageous to do so. Where futures are
purchased to hedge against the possible increase in the price of securities
before a Fund is able to invest its cash in an orderly fashion, it is possible
that the market may decline instead; if a Fund's investment adviser then
concludes not to invest in securities at that time because of concern as to
possible future market decline or for other reasons, there would be a realized
loss on the futures contract that is not offset by a reduction in the price of
the securities purchased. The risk of loss to a Fund is theoretically unlimited
if no investment in securities is made as a result of the market conditions
noted above. Although a Fund will enter into futures contracts only on exchanges
where there appears to be a liquid market, there can be no assurance that such
liquidity will always exist.
Brokerage commissions on a Fund's financial futures and options
transactions and premium costs for purchasing options may tend to reduce its
yield.
For further information about a Fund's hedging activities, see 'Investment
Objectives and Policies--Hedging Activities' in the Statement of Additional
Information.
PROSPECTUS (16)
<PAGE>
INTEREST RATE RISK
In general, the prices of debt securities vary inversely with interest rates. If
interest rates rise, debt security prices generally fall; if interest rates
fall, debt security prices generally rise. In addition, for a given change in
interest rates, longer-maturity debt securities fluctuate more in price (gaining
or losing more in value) than shorter-maturity debt securities, and generally
offer higher yields than shorter-maturity debt securities, all other factors,
including credit quality, being equal.
INVESTMENT
RESTRICTIONS
INTERMEDIATE NEW YORK TAX-EXEMPT FUND
As a non-diversified series of a registered investment company, the Intermediate
New York Tax-Exempt Fund is not limited by the 1940 Act as to the proportion of
its assets that it may invest in the obligations of a single issuer. The
Intermediate New York Tax-Exempt Fund may be more susceptible to adverse
economic, political or regulatory developments affecting a single issuer than
would be the case if it was a diversified company. Although it is a
non-diversified series, the Intermediate New York Tax-Exempt Fund will observe
certain diversification standards in order to maintain its status as a regulated
investment company under the Tax Code. See 'Taxes' in the Statement of
Additional Information.
INTERMEDIATE TAX-EXEMPT FUND
As a diversified series of a registered investment company, 75% of the total
assets of the Intermediate Tax-Exempt Fund is subject to the following
limitations: (a) it may not invest more than 5% of the value of its total assets
in the securities of any one issuer, except obligations of the United States
Government and its agencies and instrumentalities and (b) it may not own more
than 10% of the outstanding voting securities of any one issuer.
Each Fund also operates under certain investment restrictions that,
together with its investment objective, are deemed fundamental policies of a
Fund--i.e., they may be changed only with the approval of the holders of a
majority of the Fund's outstanding shares.
A Fund may not (i) acquire any illiquid securities if as a result more than
15% of the market value of its net assets would be in investments that are
illiquid, (ii) borrow money, except from banks for extraordinary or emergency
purposes and then only in amounts up to 20% of the value of the Fund's total
assets (taken at cost at the time of borrowing), and except in connection with
permitted reverse repurchase agreements; or mortgage, pledge, or hypothecate any
assets except in connection with any such borrowing in amounts up to 20% of the
value of the Fund's net assets at the time of borrowing, (iii) purchase
securities while borrowings, including reverse repurchase agreements, exceed 5%
of its total assets, (iv) purchase securities other than those described under
'Investment Objectives and Policies', (v) purchase securities of any one issuer
if, after such purchase, more than 5% of the value of the Fund's total assets
would be invested in the securities of any one such issuer, provided that this
limitation does not apply to securities issued by the United States Government,
its agencies or
(17) PROSPECTUS
<PAGE>
instrumentalities, or to permitted investments of up to 50% of the Fund's
total assets, (vi) invest more than 20% of its total assets in investments
that are not Municipal Obligations or (vii) acquire industrial revenue bonds
if, as a result, more than 5% of the Fund's total assets would be invested in
industrial revenue bonds where payment of principal and interest is the
responsibility of companies with fewer than three years of operating history.
For a more detailed discussion of the above investment restrictions, see
'Investment Restrictions' and 'Additional Information' in the Statement of
Additional Information.
MANAGEMENT
OF THE FUNDS
DIRECTORS
Pursuant to the Articles of Incorporation and Bylaws of BNY Hamilton Funds,
Inc., the Directors decide matters of general policy and review the actions of
the Funds' investment adviser, administrator, distributor and other service
providers. The Statement of Additional Information contains the name and general
business experience of each director of BNY Hamilton Funds, Inc.
INVESTMENT ADVISER
The Bank of New York serves as the investment adviser (the 'Adviser') to each of
the Funds. The Adviser, which has its principal offices at 48 Wall Street, New
York, NY 10286, is New York's first bank, founded by Alexander Hamilton in 1784,
and is one of the largest commercial banks in the United States, having over $60
billion in assets at December 31, 1997. It is the leading retail bank in the
greater New York suburban area, having 363 branches at December 31, 1997. As of
December 31, 1997, the Adviser provided administrative or advisory services to
approximately $42 billion in assets.
Colleen M. Frey, Vice President, has been responsible for the day-to-day
portfolio management of the Intermediate New York Tax-Exempt Fund since its
inception. Ms. Frey has been employed by the Adviser for the past 30 years.
Currently, she is a Group Head for the Adviser's Tax-Exempt Bond Management
Division.
Jeffrey B. Noss, Vice President, is responsible for the day-to-day
portfolio management for the Intermediate Tax-Exempt Fund. Mr. Noss has been
managing tax-exempt portfolios for the Adviser's Tax-Exempt Bond Management
Division for the past ten years.
The Adviser manages the investments of each Fund and is responsible for all
purchases and sales of each Fund's portfolio securities. The Adviser's fee
accrues daily and is payable monthly at the annual rate of .50% of average daily
net assets for each Fund.
ADMINISTRATOR
BNY Hamilton Distributors, Inc. ('BNY Hamilton Distributors') serves as the
Funds' administrator (the 'Administrator') and assists generally in supervising
the operations of each
PROSPECTUS (18)
<PAGE>
Fund. BNY Hamilton Distributors is a Delaware corporation organized to
administer and distribute mutual funds; its offices are located at 3435 Stelzer
Road, Columbus, Ohio 43219-3035.
The Administrator has agreed to provide facilities, equipment and personnel
to carry out administrative services for the Funds, including, among other
things, providing the services of persons who may be appointed as officers and
directors of BNY Hamilton Funds, Inc., overseeing the performance of the Funds'
transfer agent, supervising purchase and redemption orders (made via telephone
and mail) and monitoring the Distributor's compliance with the rules and
regulations of the National Association of Securities Dealers and federal and
state securities laws. The Administrator will also be responsible for
coordinating and overseeing compliance by the Directors with Maryland corporate
procedural requirements (as BNY Hamilton Funds, Inc. is a Maryland corporation;
see 'Organization'). In addition, the Administrator's duties include assisting
in the drafting and printing prospectuses and statements of additional
information, administering shareholder meetings, producing proxy statements and
annual and semi-annual reports, monitoring the Adviser's compliance with the
stated investment objective and restrictions of each Fund and monitoring the
custodian, fund accounting, transfer agency, administration, distribution,
advisory and legal services that are provided to the Funds.
The Administration Agreement permits the Administrator to delegate certain
of its responsibilities to other service providers. Pursuant to this authority,
the Administrator has delegated certain administrative functions to The Bank of
New York. The Bank of New York is not an affiliated person of BNY Hamilton
Distributors.
Each Fund pays annual administration fees, accrued daily and payable monthly, of
.20% of average daily net assets for each Fund.
DISTRIBUTOR
In addition to acting as the Administrator, BNY Hamilton Distributors will be
the exclusive underwriter and distributor of shares of each Fund (the
'Distributor'); its offices are located at 125 West 55 Street, New York, New
York 10019.
The Distributor will make a continuous offering of each Fund's shares and
bears the costs and expenses of distributing to selected dealers and prospective
investors copies of any prospectuses, statements of additional information and
annual and interim reports of the Funds (after such items have been prepared,
set in type and sent by the Funds at their expense to existing shareholders)
that are used in connection with the offering of shares, and the costs and
expenses of preparing, printing and distributing any other literature used by
the Distributor or furnished by it for use by selected dealers in connection
with the offering of each Fund's shares for sale to the public.
The Administrator (and Distributor) is a wholly-owned subsidiary of The
BISYS Group, Inc., whose other subsidiaries provide distribution and
administration services for other mutual fund groups.
(19) PROSPECTUS
<PAGE>
SUMMARY OF
SHAREHOLDER
SERVICES
A Fund's telephone representative will be happy to answer any questions you may
have.
<TABLE>
<S> <C>
Telephone For Information Regarding
1-800-4BNY-FND o Any of the Funds' investment objectives and
(1-800-426-9363) policies
8 a.m. to 9 p.m., Eastern time o Opening an account
1-800-952-6276 o Current account balances
8 a.m. to 9 p.m., Eastern time o Shareholder address/telephone changes
</TABLE>
You should note that neither the Funds nor their service contractors will
be responsible for any loss or expense for acting upon telephone instructions
that they believe to be genuine. In attempting to confirm that telephone
instructions are genuine, the Funds will use procedures considered reasonable,
as described in 'Redemption of Shares' in the Statement of Additional
Information. To the extent that any of the Funds does not use reasonable
procedures to form its belief as to the genuineness of accountholders'
instructions, it and/or its service contractors may be responsible for such
instructions that are fraudulent or unauthorized.
The Funds want you to be kept current regarding the status of your account.
To assist you, the following statements and reports will be sent to you:
<TABLE>
<S> <C>
- ----------------------------------------------------------------------------------------
CONFIRMATION STATEMENTS After every transaction that affects your
account balance or your account
registration.
- ----------------------------------------------------------------------------------------
ACCOUNT STATEMENTS Quarterly, showing any activity during the
quarter, any income credited during the
quarter and the current value of your
account.
- ----------------------------------------------------------------------------------------
FINANCIAL REPORTS Every six months, one copy of most Fund
reports and year-end tax information will
be mailed to each household, regardless of
how many accounts are in the household.
- ----------------------------------------------------------------------------------------
</TABLE>
FUND AND OTHER
SHAREHOLDER SERVICES
CUSTODIAN AND FUND ACCOUNTING AGENT
The Bank of New York, 90 Washington Street, New York, New York 10286, serves as
each Funds' custodian. BNY Hamilton Funds, Inc. has also entered into a Cash
Management and Related Services Agreement with The Bank of New York pursuant to
which The Bank of
PROSPECTUS (20)
<PAGE>
New York, as custodian, will receive and disburse funds in connection with the
purchases and redemptions of each Fund's shares.
The Bank of New York also serves as the fund accounting agent for each Fund
with responsibility for calculating the net asset value of, and maintaining the
books and records of, each class of shares for both Funds.
TRANSFER AGENT
BISYS Fund Services, Inc. ('BISYS'), P.O. Box 163310, Columbus, Ohio,
43216-3310, serves as each Fund's transfer agent. BISYS is a wholly-owned
subsidiary of The BISYS Group, Inc. As transfer agent, BISYS maintains the
records of each shareholder's account, answers shareholder inquiries concerning
accounts, processes purchases and redemptions of each Fund's shares, acts as
dividend and distribution disbursing agent and performs other shareholder
service functions.
DISTRIBUTION PLAN
The Directors have adopted a plan of distribution under Rule 12b-1 of the 1940
Act with respect to the Investor Shares of each Fund (collectively, the '12b-1
Plans').
Under the 12b-1 Plans, the subject Fund may reimburse the Distributor for
expenses incurred in connection with the distribution of that Fund's shares.
Such distribution expenses will include expenses incurred in connection with
advertising and marketing such Fund's shares and expenses incurred in connection
with preparing, printing and distributing prospectuses for such Fund (except
those used for regulatory purposes or for distribution to existing shareholders
of each Fund) and in implementing and operating the 12b-1 Plans. To date, the
Directors have only adopted 12b-1 Plans with respect to the Investor Class of
each Fund.
Under the 12b-1 Plans, reimbursements for distribution expenses may not
exceed .25% (annualized) of the relevant Fund's average daily net assets,
excluding from such calculation, however, all shares acquired via a transfer of
assets from customer accounts at The Bank of New York. These amounts may be
reduced pursuant to undertakings by the Distributor. Payments for distribution
expenses under the 12b-1 Plans are subject to Rule 12b-1 under the 1940 Act.
Except for expenses related to telemarketing operations established for BNY
Hamilton Funds, Inc., it is presently contemplated that the Distributor will not
be reimbursed for any of its overhead expenses by a Fund under its respective
12b-1 Plan.
The 12b-1 Plans provide that if in any month the Distributor is due more
monies than are immediately payable because of the percentage limitation
described above, the unpaid amount will be carried forward from month to month
while the 12b-1 Plan is in effect until such time as it may be paid. Any carried
forward amounts will not be payable beyond the fiscal year during which the
amounts are accrued. No interest, carrying or other finance charge is borne by a
Fund with respect to amounts carried forward past the fiscal year in which it is
incurred. As of December 31, 1997, there were no unreimbursed expenses
associated with either Fund's 12b-1 Plan.
FEE WAIVERS
Except as noted in this Prospectus and the Statement of Additional Information,
the Funds' service contractors bear all expenses in connection with the
performance of their services and each Fund bears the expenses incurred in its
operation. From time to time during the course of
(21) PROSPECTUS
<PAGE>
the Funds' fiscal year, each of the Administrator and the Adviser may
voluntarily elect not to receive payment of fees under their respective
agreements described above and/or to assume certain expenses of a Fund while
retaining the ability to be reimbursed by a Fund for such amounts prior to the
end of the fiscal year. This will have the effect of increasing yield to
investors at the time such fees are not received or amounts are assumed by the
Administrator or the Adviser and decreasing yield when such fees or amounts are
reimbursed to the Administrator or the Adviser. See the Fee Table for each class
of shares for each Fund.
PURCHASE
OF SHARES
To purchase Institutional Shares in any Fund, contact your Bank of New York
representative for details.
The following table summarizes the types of investments available in each
of the Funds along with their respective minimum investment requirements. Unless
otherwise noted, all types of investments shown in the table are applicable to
Investor Shares of each Fund.
<TABLE>
<CAPTION>
MINIMUM INVESTMENT REQUIRED
----------------------------------------------------------
INITIAL ADDITIONAL
TYPE OF INVESTMENT INVESTMENT INVESTMENT
- -------------------------------------------------- --------------------------- ---------------------------
<S> <C> <C>
Regular Account................................... $ 2,000 $ 100
Regular Account with Automatic Investment
Program......................................... $ 500 $ 50
Regular Accounts for employees and retirees of The
Bank of New York and its affiliates, and
employees of each of the Administrator, the
Distributor and their affiliates (1)............ $ 100 $ 25
Individual Retirement Account ('IRA')(2).......... $ 250 $ 25
</TABLE>
- ------------------------------
(1) Available exclusively for employees and retirees of The Bank of New York and
its affiliates, and for the employees of BNY Hamilton Distributors, Inc.,
and their affiliates. The employees of The Bank of New York and its
affiliates may make investments through payroll deduction.
(2) Not available for BNY Hamilton Intermediate New York Tax-Exempt Fund.
Institutional and Investor Shares of any of the Funds may be purchased
without sales commission, at the net asset value per share next determined after
the purchase order and federal funds are received by the specific Fund. See 'Net
Asset Value'.
The Distributor, from time to time, at its expense, will also provide
additional compensation to dealers in connection with sales of Investor Shares
of any of the Funds. Such compensation will include non-cash payments which may
take the form of (1) gift certificates, (2) tickets for entertainment events,
(3) trips, including the provision of travel arrangements and lodging at
vacation resorts and (4) merchandise. Dealers may not use sales of the Funds'
shares to qualify for this compensation to the extent such sales may be
prohibited by laws of any state or any self-regulatory agency, such as the
National Association of Securities Dealers, Inc. None of the aforementioned
compensation is paid for by any Fund or its shareholders.
PROSPECTUS (22)
<PAGE>
INITIAL INVESTMENTS
Orders for purchase of a Fund's Investor Shares received by 4:00 P.M. (Eastern
time) on any Business Day and transmitted to the Fund's transfer agent by 4:00
P.M. (Eastern time) will be based on the next determined net asset value. (For
purposes of this Prospectus, 'Business Day' is defined to mean any day on which
both the New York Stock Exchange and the custodian are open for business.)
Investors will begin to earn dividends on the next Business Day after receipt of
the purchase order. On those days when the New York Stock Exchange or the
custodian closes early as a result of such day being a partial holiday or
otherwise, the right is reserved to advance the time on that day by which
purchase and redemption requests must be received.
Prospective investors may purchase a Fund's Investor Shares by check, by
federal funds wire, by bank wire, or by direct deposit. Additional investments
may also be made through an Automatic Investment Program. See the tables on the
following pages.
METHOD OF PURCHASE FOR INITIAL INVESTMENTS
BY CHECK
-- Complete and sign a New Account Application and mail it, together with a
check payable to the specific Fund, to: BNY Hamilton Funds, P. O. Box
163310, Columbus, Ohio 43216-3310.
-- Purchases made by check are not permitted to be redeemed until payment of
the purchase has been collected, which may take up to ten (10) Business
Days after purchase.
-- Purchases by check must be payable in United States dollars and drawn on
United States banks. THE FUNDS WILL NOT ACCEPT THIRD-PARTY CHECKS.
BY FEDERAL FUNDS WIRE
-- An investor desiring to purchase shares by wire should call the Transfer
Agent at 1-800-952-6276 and place a purchase order.
-- Have your bank wire federal funds to the BNY Hamilton Funds' bank account
(see below). In order to ensure prompt receipt by a Fund of a federal funds
wire, an investor should take the following steps:
A. Instruct your bank to wire the specified amount to the specific Fund's
account as follows (be sure to have your bank include the name of the
specific Fund selected, and state that the wire is for a new account):
The Bank of New York
New York, NY 10286
ABA #021000018
BNY Hamilton Funds
DDA #8900275847
Attn.: (specific Fund selected)
Ref.: (your account number, your account
name and taxpayer identification number)
(23) PROSPECTUS
<PAGE>
B. Complete the New Account Application and mail it to the appropriate address
shown in 'By Check' above.
-- Federal funds purchase orders will only be accepted on Business Days as
defined herein. Your bank may charge a service fee for wiring funds.
BY BANK WIRE
-- Follow the same procedure outlined under 'By Federal Funds Wire' above.
Your bank may charge a service fee for wiring funds.
BY DIRECT DEPOSIT
-- In certain circumstances, employees and retirees of The Bank of New York
and its affiliates may purchase Fund shares by having payments
automatically deposited into their specific Fund account.
-- Call 1-800-4BNY-FND (1-800-426-9363) for details.
METHOD OF PURCHASE FOR ADDITIONAL INVESTMENTS
BY CHECK
-- Make check payable to the specific Fund and send to: BNY Hamilton Funds,
Inc., P.O. Box 806, Newark, New Jersey 07101-0806. If possible, please
include the tear-off payment stub that accompanies a Fund's confirmation
statement.
BY FEDERAL FUNDS WIRE
-- Have your bank wire federal funds according to the instructions on the
previous page, except the wire should state that it is an additional
investment.
-- Please include your account number.
BY AUTOMATIC INVESTMENT PROGRAM
-- You may arrange, through the Automatic Investment Program, for purchases of
Fund shares (minimum of $50) by direct debit from your account at any
domestic financial institution that is an Automated Clearing House member.
-- To elect this feature, please complete Section 7 on the new account
application.
-- See 'Purchase of Shares--Automatic Investment Program' or call
1-800-4BNY-FND (1-800-426-9363) for further details on this investment
option.
BY BANK WIRE
-- The procedure is identical to 'By Federal Funds Wire' above.
BY DIRECT DEPOSIT
-- Call 1-800-4BNY-FND (1-800-426-9363) for details.
-- Additional purchases will be processed in accordance with your
instructions.
PROSPECTUS (24)
<PAGE>
AUTOMATIC INVESTMENT PROGRAM
You may arrange, through the Automatic Investment Program, for systematic
investments in your Fund account(s) in amounts of $50 or more (PROVIDED AN
INITIAL INVESTMENT OF $500 OR MORE HAS BEEN ESTABLISHED) by directly debiting
your account at the financial institution designated by you on the new account
application. At your option, your checking, NOW or bank money market account
designated by you will be debited in the specified amount, and Investor Shares
will be purchased, once a month, on either the first or fifteenth day, or twice
a month on both days. Only accounts maintained at a domestic financial
institution which permits automatic withdrawals and is an Automated Clearing
House member are eligible.
The Automatic Investment Program enables shareholders to invest a fixed
dollar amount at predetermined intervals, an investment strategy known as
'dollar cost averaging'. By applying this technique consistently over time,
investors usually purchase more shares during periods of low share prices and
fewer shares as share prices increase. You may also implement dollar cost
averaging on your own initiative or through other entities.
To be effective, dollar cost averaging should be carried out consistently
for a sustained period of time. You should understand, however, that purchases
made through the Automatic Investment Program will be made by the Fund without
regard to share price on the day of investment or to market trends. In addition,
while you may find dollar cost averaging to be beneficial, it will not prevent a
loss if you ultimately redeem your shares at a price that is lower than their
purchase price.
You may cancel this privilege or change the amount of purchase at any time
by mailing written notification to:
BNY Hamilton Funds
P.O. Box 163310
Columbus, OH 43216-3310
Notification will be effective seven days following receipt. The Fund may modify
or terminate this privilege at any time or charge a service fee, although no
such fee currently is contemplated.
OTHER PURCHASE INFORMATION
Investors may purchase Investor Shares of any Equity Fund, Taxable Fixed Income
Fund, BNY Hamilton Intermediate Tax-Exempt Fund or Hamilton Classic Shares of
BNY Hamilton Money Fund offered by BNY Hamilton Funds, Inc., or a combination of
Funds, in increments of 10% through an individual retirement account made
available by BNY Hamilton Funds, Inc., as described in the Minimum Investment
Required table earlier in this section. Please refer to a 'BNY Hamilton Funds
Individual Retirement Account' kit for details. Investors are also advised to
consult with their own legal counsel or tax adviser regarding these investments.
In the interest of economy and convenience and because of its operating
procedures, a Fund will not issue certificates representing ownership of either
class of its shares. All shares purchased will be confirmed to you and credited
to your account on the specific Fund's books maintained by the transfer agent.
You will have the same rights and ownership with respect to such shares as if
certificates had been issued.
(25) PROSPECTUS
<PAGE>
To assure that checks are collected by a Fund, withdrawals of
investments made by check will not be permitted until payment for the
purchase has been received, which may take up to ten (10) Business Days after
the date of purchase. A Fund will charge a $15.00 processing fee for checks
returned unpaid. This charge may be deducted from the account of the investor
that requested the purchase. In addition, you may be prohibited or restricted
from making future purchases in any Fund offered by BNY Hamilton Funds, Inc.
Investors may also invest in any Fund offered by BNY Hamilton Funds, Inc.
by purchasing shares through registered broker-dealers, which are required to
effect the transaction at the net asset value next determined after receipt of
the order by the broker-dealer and are required to transmit such orders promptly
to the specific Fund. Broker-dealers who make purchases for their customers may
charge a fee for such services.
Federal regulations require that investors provide a social security or
taxpayer identification number upon opening or re-opening an account. Investors
should refer to the New Account Application for further information about this
requirement.
REDEMPTION
OF SHARES
To redeem Institutional Shares in any Fund, contact your Bank of New York
representative for details.
Investors may withdraw all or any portion of the Investor Shares in their
account at any time by redeeming such shares. INVESTORS SHOULD BE AWARE THAT,
UNLIKE A SAVINGS ACCOUNT, A REDEMPTION IN ANY OF THE FUNDS IS A TAXABLE EVENT.
CONSULT YOUR TAX ADVISER FOR THE POTENTIAL TAX SITUATIONS THAT MAY ARISE AS A
RESULT OF A REDEMPTION OF SHARES.
METHOD OF REDEMPTION
A Fund will redeem Investor Shares at the next determined net asset value per
share. A Fund's net asset value per Investor Share will be determined on each
Business Day at 4:00 p.m. (Eastern time). The value of the shares redeemed may
be more or less than their original cost, depending upon a Fund's then-current
net asset value.
BY MAIL
-- Send your request to: BNY Hamilton Funds, P. O. Box 163310, Columbus, Ohio
43216-3310. (Be sure to include the name of the specific Fund and your
account number.)
BY TELEPHONE (1)
-- This option must have previously been elected. Call the specific Fund and
request that the redemption proceeds be mailed to the address listed in the
specific Fund's account records or wired to the investor's bank as listed
in the specific Fund's records.
- ------------------------------
(1) In times of drastic market conditions, the telephone redemption option may
be difficult to implement. If you experience difficulty in making a
telephone redemption, you may make your request by regular mail or express
mail and it will be implemented at the net asset value per share next
determined after the request is received.
PROSPECTUS (26)
<PAGE>
BY SYSTEMATIC WITHDRAWAL
-- YOUR ACCOUNT MUST HAVE A VALUE OF $10,000 OR MORE.
-- The record owner of shares may request a declining balance withdrawal, a
fixed dollar withdrawal, a fixed share withdrawal, or a fixed percentage
withdrawal (based on the current value of shares in the account) on a
monthly, quarterly, semi-annual or annual basis.
-- Further information about establishing a Systematic Withdrawal Plan may be
obtained by calling 1-800-4BNY-FND (1-800-426-9363).
BY DRAFT
-- Redemption checks may be made payable to the order of any person in the
amount of $500 or more.
-- Redemption checks are free, but the transfer agent will impose a fee for
stopping payment of a redemption check at your request or if the transfer
agent cannot honor the redemption check because of insufficient funds or
any other valid reason.
-- Shares for which certificates have been issued may not be redeemed by
redemption check.
Each Fund will redeem its Investor Shares at the net asset value next
determined after the request is received in good order. 'Good order' means that
the request to redeem Investor Shares includes the following documentation: (i)
a letter of instruction or a stock assignment containing the account number and
taxpayer identification number(s) of the shareholder(s), specifying the number
of shares or dollar amount to be redeemed and signed by all registered owners of
the shares in the exact names in which they are registered; (ii) any required
signature guarantees, see 'Further Redemption Information' below; and (iii)
other supporting legal documents, if required, in the case of estates, trusts,
guardianships, custodianships, corporations, pension and profit-sharing plans
and other organizations. The Funds may adopt certain procedures as described in
'Redemption of Shares' in the Statement of Additional Information to verify
information provided with a redemption request. Shareholders who are uncertain
of the requirements for redemption should consult with a BNY Hamilton Funds,
Inc. representative by calling 1-800-952-6276.
DISCRETIONARY REDEMPTION BY A FUND
If the value of a shareholder's holdings falls below $500 because of a
redemption of Investor Shares, the shareholder's remaining shares may be
involuntarily redeemed after 60 days' written notice, unless the value of the
account is increased to $500 or more.
(27) PROSPECTUS
<PAGE>
FURTHER REDEMPTION INFORMATION
Normally, a Fund will make payment for all Investor Shares redeemed under these
procedures within one Business Day of receipt of the request, but in no event
will payment be made more than seven days after receipt of a redemption request
in good order. At various times, the Funds may be requested to redeem Investor
Shares for which it has not yet received good payment. In such circumstances,
the Funds may delay the forwarding of proceeds for up to 15 days or more until
payment has been collected for the purchase of such Investor Shares. A Fund
reserves the right to suspend redemption or postpone the date of redemption at
times when the New York Stock Exchange is closed or when trading on the Exchange
is restricted, under certain emergency circumstances and during periods when
such suspension is permitted by the Securities and Exchange Commission. See the
Statement of Additional Information; 'Redemption of Shares--Further Redemption
Information'.
To change the address listed in a specific Fund's account records or the
name of the commercial bank or account designated to receive redemption
proceeds, an investor must send a written request to: BNY Hamilton Funds, P. O.
Box 163310, Columbus, Ohio 43216-3310. Such requests must be signed by each
shareholder, and, for requests to change the bank or account designated to
receive redemption proceeds, each signature must be guaranteed.
EXCHANGE
OF SHARES
Shareholders purchasing shares directly from the Funds may exchange those shares
at the current net asset per share for other BNY Hamilton Funds which have a
similar class of shares, in accordance with the terms of the current prospectus
of the Fund being acquired, without charge. An exchange may be made so long as
the shares to be exchanged have a value of at least $500. Accordingly, when
establishing a NEW account by exchange, shares of the Fund being exchanged must
have a value at least equal to the minimum initial investment required by the
Fund into which the exchange is being made (currently $2,000 for all shares
available to retail investors for each Fund in BNY Hamilton Funds, Inc.). Shares
will be exchanged on the basis of relative net asset value per share.
Exchanges are in effect redemptions from one Fund and purchases of another
Fund and the usual purchase and redemption procedures and requirements are
applicable to exchanges. See 'Purchase of Shares' and 'Redemption of Shares'.
Before making any exchange, investors are advised to review the sections of this
Prospectus pertaining to the specific Fund or the appropriate sections of the
prospectuses for the other Funds in BNY Hamilton Funds, Inc.
Since an exchange is essentially a redemption from a specific Fund,
shareholders who exchange shares in any of the Funds for shares in any of the
other Funds may recognize a capital gain or loss for tax purposes. The Funds
reserve the right to discontinue, alter or limit the exchange privilege at any
time. At least 60 days' notice will be given to shareholders of any material
modification or termination. The exchange privilege will be honored only in
those states where such exchanges are legally permissible.
PROSPECTUS (28)
<PAGE>
DIVIDENDS AND
DISTRIBUTIONS
The net investment income for each class of each Fund's shares will be declared
as dividends daily and paid monthly within five (5) Business Days after such
dividend is declared (usually by the 20th day of the month). Dividends and
distributions will be payable to shareholders of record at the time of
declaration. The Directors may revise a Fund's dividend policy without action by
the shareholders.
The net investment income of each class of each Fund for each Business Day
will be determined immediately prior to the determination of net asset value.
Net investment income for other days will be determined on the prior Business
Day. Shares of each class of a Fund will begin earning dividends on the next
Business Day after the date of the investment. See 'Purchase of Shares' and
'Redemption of Shares'.
Each of the Funds will distribute substantially all of any taxable net
long-term gains realized on investments to shareholders at least annually in
accordance with requirements under the Tax Code, and other applicable statutory
and regulatory requirements.
DIVIDEND AND GAIN DISTRIBUTION OPTIONS
Each Fund will pay dividends and gain distributions, if any, in accordance
with the current option on each shareholder's account. If a shareholder does not
select a dividend and gain option, dividends and gains will be paid in
additional shares. Shareholders may choose to receive dividends in cash and any
gain distributions in shares or receive both dividends and any gain
distributions in cash. A shareholder can change the option selected on his or
her account by notifying the transfer agent in writing at least five (5)
Business Days prior to a dividend or gain distribution payment date. In the
event that a shareholder redeems all shares in an account between the record
date and the payable date, the value of the gain distributions declared and
payable will be paid in cash regardless of the existing election.
If you elect to receive distributions in cash, and the checks (1) are
returned and marked as 'undeliverable' or (2) remain uncashed for six months,
your cash election will be changed automatically and your future dividend and
capital gains distributions will be reinvested in the respective Fund at the per
share net asset value determined as of the date of payment of the distribution.
In addition, any undeliverable checks or checks that remain uncashed for six
months will be canceled and will be reinvested in the respective Fund at the per
share net asset value determined as of the date of cancellation.
NET ASSET
VALUE
Net asset value per share for each class of shares of each Fund will be
determined by subtracting from the value of a Fund's total assets attributable
to that class the amount of its liabilities attributable to that class, and
dividing the remainder by the number of its outstanding shares of that class and
rounding to the nearest one cent. Expenses, including the fees payable to the
Adviser and the Administrator, are accrued daily. See 'Net Asset Value' in the
Statement of Additional Information for more information on valuation of
portfolio securities for each Fund.
(29) PROSPECTUS
<PAGE>
Each Fund computes the net asset value of each class of its respective
shares once daily on Monday through Friday, except that net asset value of a
particular class will not be computed on any day in which no orders to purchase
or redeem shares of that class have been received or on the holidays listed
under 'Net Asset Value' in the Statement of Additional Information. Each Fund
computes net asset value as of the close of regular trading of the New York
Stock Exchange (normally 4:00 P.M., Eastern time).
ORGANIZATION
BNY Hamilton Funds, Inc. is an open-end management investment company that was
organized as a Maryland corporation on May 1, 1992. The Articles of
Incorporation of BNY Hamilton Funds, Inc. currently permit the company to issue
20,000,000,000 shares of common stock, par value $.001 per share, which have
been allocated among the Funds described in this Prospectus as follows:
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
FUND COMMON STOCK AUTHORIZED
- ---------------------------------------------------------------------------------
<S> <C>
Intermediate New York Tax-Exempt Fund
Institutional Shares................................. 200,000,000
Investor Shares...................................... 200,000,000
Intermediate Tax-Exempt Fund
Institutional Shares................................. 200,000,000
Investor Shares...................................... 200,000,000
</TABLE>
The Directors may increase the number of shares each Fund is authorized to
issue without the approval of shareholders. The Directors also have the power to
designate one or more series or classes of shares of common stock and to
classify and reclassify any unissued shares with respect to such series of
classes.
Shareholders of each series of BNY Hamilton Funds, Inc. are entitled to one
vote for each share and to the appropriate fractional vote for each fractional
share. There is no cumulative voting and no Funds' shares have any preemptive or
conversion rights. All shareholders will vote together as a single class on
matters affecting the Funds generally, including matters relating to each Fund's
investment advisory agreement, investment objective and fundamental investment
restrictions. Shareholders of a particular Fund, or of a particular class of
each Fund, will vote separately on any matters relating only to that Fund or
class, as appropriate. For example, to the extent shareholder votes are
necessary, holders of Investor Shares will vote separately on matters relating
to the class' distribution plan under Rule 12b-1. Shares offered hereby must be
fully paid upon issuance and thereafter will be non-assessable by BNY Hamilton
Funds, Inc., and the specific Fund to which they belong. None of the series of
BNY Hamilton Funds, Inc. intends to hold meetings of shareholders annually. The
Directors may call meetings of shareholders for action by shareholder vote as
may be required by the 1940 Act, the Articles of Incorporation or Bylaws of BNY
Hamilton Funds, Inc.
BNY Hamilton Funds, Inc., if requested to do so by the holders of at least
10% of the shares of all series aggregated as a class, will call a meeting of
shareholders for the purpose of voting upon the question of removal of a
director or directors and will assist in communications with other shareholders
as required by Section 16(c) of the 1940 Act. For further organization
PROSPECTUS (30)
<PAGE>
information, including certain shareholder rights, see 'Description of Shares'
in the Statement of Additional Information.
TAXES
The following discussion of federal tax consequences is based on United States
tax laws in effect on the date of this Prospectus. These laws and regulations
are subject to change by legislative, judicial or administrative action.
Investors are urged to consult their own tax advisors with respect to specific
questions as to federal taxes and with respect to the applicability of state,
local or foreign taxes. See 'Taxes' in the Statement of Additional Information.
Annual statements as to the federal tax status of distributions, and as to the
portion of each Fund's distribution that is attributable to interest that is
exempt from state and local income tax, if applicable, will be mailed to
shareholders shortly after the end of the taxable year.
FEDERAL INCOME TAXES
Each Fund intends to qualify as a 'regulated investment company' under
Subchapter M of the Tax Code. As a regulated investment company, each Fund will
not be subject to federal income taxes on the net investment income and capital
gains distributed to shareholders, provided that it distributes annually at
least 90% of its net investment income and realized net short-term capital gains
in excess of net long-term capital losses.
Each Fund intends to meet the requirements of the Tax Code so that
distributions of net interest income on obligations that are exempt from federal
income tax and held by the specific Fund when distributed to shareholders, and
designated by the specific Fund as 'exempt-interest dividends', will be exempt
from federal income tax in the hands of shareholders.
Distributions of taxable net investment income and realized net short-term
capital gains in excess of net long-term capital losses will be taxable to
shareholders of a Fund as ordinary income, whether such distributions are taken
in cash or reinvested in additional shares. Such distributions will not be
eligible for the dividends-received deduction.
Distributions of net long-term capital gains in excess of net short-term
capital losses will be taxable to shareholders as long-term capital gains
regardless of how long a shareholder has held the shares and regardless of
whether taken in cash or reinvested in additional shares. Individual
shareholders will be subject to federal income tax on distributions of net
long-term capital gains at a maximum rate of 28% if designated as derived from a
Fund's capital gains from property held for more than one year and at a maximum
rate of 20% if designated as derived from property held for more than eighteen
months.
UNLESS A SHAREHOLDER INCLUDES ITS TAXPAYER IDENTIFICATION NUMBER (SOCIAL
SECURITY NUMBER FOR INDIVIDUALS) ON THE ACCOUNT APPLICATION AND CERTIFIES THAT
IT IS NOT SUBJECT TO BACKUP WITHHOLDING, A FUND MAY BE REQUIRED TO WITHHOLD AND
REMIT TO THE U.S. TREASURY 31% OF TAXABLE DISTRIBUTIONS AND OTHER REPORTABLE
PAYMENTS TO THE SHAREHOLDER. SHAREHOLDERS SHOULD BE AWARE THAT, UNDER
REGULATIONS PROMULGATED BY THE INTERNAL REVENUE SERVICE, A FUND MAY BE FINED UP
TO $50 ANNUALLY FOR EACH ACCOUNT FOR WHICH A CERTIFIED TAXPAYER IDENTIFICATION
NUMBER IS NOT PROVIDED. IN THE EVENT THAT SUCH A FINE IS IMPOSED WITH RESPECT TO
ANY UNCERTIFIED ACCOUNT IN ANY YEAR, A CORRESPONDING CHARGE MAY BE MADE AGAINST
THAT ACCOUNT.
(31) PROSPECTUS
<PAGE>
Shareholders are urged to consult their tax advisers concerning the effect
of federal income taxes in their individual circumstances. Under the Tax Code,
interest on indebtedness incurred or continued to purchase or carry shares will
not be deductible to the extent that the interest relates to exempt-interest
dividends received by the shareholder. In addition, persons who may be
'substantial users' (or 'related persons' of substantial users) of facilities
financed by industrial development bonds or private activity bonds should
consult their tax advisers before purchasing shares of a Fund.
A portion of the exempt-interest dividend distributed by a Fund may be
treated as a preference item for purposes of the federal alternative minimum
tax. Moreover, exempt-interest dividends paid to a corporate shareholder by a
Fund (whether or not from interest on private activity bonds) will be taken into
account in determining its federal alternative minimum tax and certain other
taxes.
Dividends of the Intermediate New York Tax-Exempt Fund are not excluded in
determining New York State and New York City franchise taxes on corporations and
financial institutions.
Except during temporary defensive periods, the Intermediate New York
Tax-Exempt Fund will retain at least 80% of the value of its net assets in debt
obligations which are exempt from federal income tax and New York State and New
York City personal income taxes.
ADDITIONAL
INFORMATION
The Funds will send to their shareholders annual and semi-annual reports. The
financial statements appearing in the annual reports will be audited by
independent auditors. Shareholders will also receive confirmations of each
purchase and redemption and monthly statements, reflecting all account activity,
including dividends reinvested in additional shares or credited as cash. Written
inquiries about the Funds should be sent to BNY Hamilton Funds, P.O. Box 163310,
Columbus, Ohio 43216-3310.
A Fund may make historical performance information of either of its classes
available and may advertise total return and 30-day yield as those terms are
defined in the Statement of Additional Information under 'Performance Data'. All
performance figures will be based on historical earnings and are not intended to
indicate future performance. Performance information may be obtained by calling
the Distributor at 1-800-4BNY-FND (1-800-426-9363).
PROSPECTUS (32)
<PAGE>
APPENDIX A
TAX-FREE VS. TAXABLE INCOME
A COMPARISON OF TAXABLE AND TAX-FREE YIELDS
FOR NEW YORK STATE RESIDENTS
NEW YORK STATE RESIDENT
<TABLE>
<CAPTION>
TAX-FREE YIELDS
SINGLE JOINT COMBINED -------------------------------------------------
RETURN RETURN EFFECTIVE 4% 4.5% 5% 5.5% 6% 6.5% 7%
- ----------------- ------------------- --------- ---- ---- ---- ---- ----- ----- -----
TAXABLE EQUIVALENT YIELDS
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 42,350 20.82 5.05 5.68 6.31 6.95 7.58 8.21 8.84
$ 0- 25,350 20.82 5.05 5.68 6.31 6.95 7.58 8.21 8.84
$ 42,351- 102,300 32.93 5.96 6.71 7.45 8.20 8.95 9.69 10.44
$ 25,351- 61,400 32.93 5.96 6.71 7.45 8.20 8.95 9.69 10.44
$ 102,301-155,950 35.73 6.22 7.00 7.78 8.56 9.34 10.11 10.89
$ 61,401-128,100 35.73 6.22 7.00 7.78 8.56 9.34 10.11 10.89
$155,951-278,450 40.38 6.71 7.55 8.39 9.23 10.06 10.90 11.74
$128,101-278,450 40.38 6.71 7.55 8.39 9.23 10.06 10.90 11.74
$278,451- 43.74 7.11 8.00 8.89 9.78 10.66 11.55 12.44
$278,451- 43.74 7.11 8.00 8.89 9.78 10.66 11.55 12.44
</TABLE>
To compare the yield of a taxable security with the yield of a tax-free
security, find your taxable income and read across. These tables incorporate
current federal and applicable State income tax rates for 1998 and assume that
all income would otherwise be taxable at the investor's highest tax rates. Yield
figures are only provided as examples.
Based upon net amount subject to federal income tax after itemized
deductions and exemptions. These tables do not reflect other possible tax
factors such as the alternative minimum tax, additional itemized deductions
other than the New York State income tax, personal exemptions, the phase out of
exemptions and/or itemized deductions and the possible partial disallowance of
deductions. Consequently, investors are urged to consult their own tax advisers
in this regard.
(33) PROSPECTUS
<PAGE>
APPENDIX B
The following chart shows the comparison of the predecessor of BNY
Hamilton Intermediate Tax-Exempt Fund and a comparable index. The average
annual total return figures for the predecessor of BNY Hamilton
Intermediate Tax-Exempt Fund have not been audited.
[BAR GRAPH]
<TABLE>
<CAPTION>
BNY HAMILTON LEHMAN BROTHERS
INTERMEDIATE SEVEN YEAR
TAX-EXEMPT FUND BOND INDEX
--------------- ---------------
<S> <C> <C>
Average annual total return after one
year...................................... 3.68% 4.58%
Average annual total return after five
years..................................... 5.29% 6.72%
Average annual total return after ten
years..................................... 5.95% 7.54%
</TABLE>
The performance results presented above are those of Bank of New York CTF
Intermediate Tax-Exempt Fund, a private trust fund advised by The Bank of New
York. These are not performance results of any class of BNY Hamilton
Intermediate Tax-Exempt Fund, and should not be interpreted as indicative of the
future performance of the Intermediate Tax-Exempt Fund.
The Bank of New York CTF Intermediate Tax-Exempt Fund's investment
objective, policies and strategies are substantially similar to those of the
Intermediate Tax-Exempt Fund, although, unlike the Intermediate Tax-Exempt Fund,
the Bank of New York CTF Intermediate Tax-Exempt Fund is not subject to certain
investment limitations, tax restrictions, diversification requirements and other
restrictions imposed by law upon mutual funds, which, if applicable to the Bank
of New York CTF Intermediate Tax-Exempt Fund, may have adversely affected
performance.
PROSPECTUS (34)
<PAGE>
The Bank of New York CTF Intermediate Tax-Exempt Fund's performance results
reflect reinvestment of dividends. In addition, because the Bank of New York CTF
Intermediate Tax-Exempt Fund is not subject to advisory or administrative
expenses usually associated with mutual funds, the performance results have been
adjusted to reflect the deduction of the aggregate advisory, administrative and
other expenses described in this prospectus as being applicable to Investor
Shares of BNY Hamilton Intermediate Tax-Exempt Fund. Performance shown conforms
to the standards established by the Association for Investment Management and
Research.
The Lehman Brothers Seven Year Bond Index is an unmanaged index generally
considered representative of the Intermediate Municipal Bond Market. The Index
does not take into account fees and expenses.
Performance for the Intermediate New York Tax-Exempt Fund can be found in
its Annual Report to Shareholders, available from the Fund's Distributor upon
request and without charge.
(35) PROSPECTUS
<PAGE>
[This page intentionally left blank]
<PAGE>
[This page intentionally left blank]
<PAGE>
BNY HAMILTON FUNDS, INC.
Statement of Additional Information
BNY Hamilton Money Fund
BNY Hamilton Treasury Money Fund
BNY Hamilton Equity Income Fund
BNY Hamilton Large Cap Growth Fund
BNY Hamilton Small Cap Growth Fund
BNY Hamilton International Equity Fund
BNY Hamilton Intermediate Government Fund
BNY Hamilton Intermediate Investment Grade Fund
BNY Hamilton Intermediate New York Tax-Exempt Fund
BNY Hamilton Intermediate Tax-Exempt Fund
April 30, 1998
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS, BUT
CONTAINS ADDITIONAL INFORMATION ABOUT THE FUNDS LISTED ABOVE WHICH SHOULD
BE READ IN CONJUNCTION WITH THE RELEVANT PROSPECTUS, EACH DATED APRIL 30,
1998, AS SUPPLEMENTED FROM TIME TO TIME, WHICH MAY BE OBTAINED UPON
REQUEST FROM BNY HAMILTON DISTRIBUTORS, INC., 125 WEST 55TH STREET, NEW
YORK, NEW YORK 10019 ATTENTION: BNY HAMILTON FUNDS, INC., 1-800-426-9363.
<PAGE>
Table of Contents
<TABLE>
<CAPTION>
Page
Money Market Funds
-------------------------------------------------------
Hamilton Hamilton
Hamilton Premier Classic
Shares Shares Shares
Prospectus Prospectus Prospectus
--------------- --------------- --------------
<S> <C> <C> <C> <C>
General................................... 3
Investment Objectives and Policies........ 3 5 5 3
Investment Restrictions................... 28 10 10 8
Directors and Officers.................... 36 11 11 9
Investment Adviser........................ 40 11 11 10
Administrator............................. 43 11 11 10
Distributor............................... 44 12 12 11
Fee Waivers............................... 13 14 13
Fund, Shareholder and Other Services...... 46 12 12 11
Purchase of Shares........................ 46 13 15 18
Redemption of Shares...................... 47 15 16 19
Exchange of Shares........................ 48 16 17 20
Dividends and Distributions............... 48 17 18 21
Net Asset Value........................... 49 18 19 21
Performance Data.......................... 51
Portfolio Transactions and Brokerage...... 55
Description of Shares..................... 58 18 20 22
Taxes..................................... 61 19 20 22
Special Considerations Relating to
Investments in New York Municipal
Obligations............................ 66
Additional Information.................... 83 20 21 23
Financial Statements...................... 84
Appendix A--Description of Securities
Ratings................................ 85
</TABLE>
1
<PAGE>
Table of Contents
<TABLE>
<CAPTION>
Page
Tax-
Taxable Exempt
Fixed Fixed
Equity Income Income
Funds Funds Funds
Prospectus Prospectus Prospectus
-------------- --------------- ---------------
<S> <C> <C> <C> <C>
General................................... 3
Investment Objectives and Policies........ 3 9 5 5
Investment Restrictions................... 28 20 14 17
Directors and Officers.................... 36 21 15 18
Investment Adviser........................ 40 21 15 18
Administrator............................. 43 22 15 18
Distributor............................... 44 23 16 19
Fee Waivers............................... 25 19 21
Fund, Shareholder and Other Services...... 46 24 17 20
Purchase of Shares........................ 46 26 19 22
Redemption of Shares...................... 47 30 23 26
Exchange of Shares........................ 48 32 26 28
Dividends and Distributions............... 48 32 26 29
Net Asset Value........................... 49 33 27 29
Performance Data.......................... 51
Portfolio Transactions and Brokerage...... 55
Description of Shares..................... 58 34 28 30
Taxes..................................... 61 35 28 31
Special Considerations Relating to Investments 7
in New York Municipal Obligations...... 66
Additional Information.................... 83 36 29 32
Financial Statements...................... 84
Appendix A--Description of Securities
Ratings................................ 85
</TABLE>
2
<PAGE>
- --------------------------------------------------------------------------------
GENERAL
BNY Hamilton Funds, Inc. is an open-end investment company, currently
consisting of ten series: BNY Hamilton Money Fund, BNY Hamilton Treasury
Money Fund, BNY Hamilton Equity Income Fund, BNY Hamilton Large Cap
Growth Fund, BNY Hamilton Small Cap Growth Fund, BNY Hamilton
International Equity Fund, BNY Hamilton Intermediate Government Fund, BNY
Hamilton Intermediate Investment Grade Fund, BNY Hamilton Intermediate
New York Tax-Exempt Fund and BNY Hamilton Tax-Exempt Fund (individually,
a "Fund" and collectively, the "Funds"). The Bank of New York (the
"Adviser") will serve as investment adviser to each of the Funds. This
Statement of Additional Information provides additional information with
respect to the Funds and should be read in conjunction with the current
Prospectus relating to each Fund. The Funds' executive offices are
located at 3435 Stelzer Road, Columbus, Ohio 43219-3035.
- -------------------------------------------------------------------------------
INVESTMENT OBJECTIVES AND POLICIES
BNY Hamilton Money Fund (the "Money Fund") is designed to be an
economical and convenient means of making substantial investments in
money market instruments. The Fund's investment objective is to earn as
high a level of current income as is consistent with preservation of
capital and maintenance of liquidity by investing in high quality money
market instruments. The Fund will attempt to accomplish this objective by
maintaining a dollar-weighted average portfolio maturity of not more than
90 days and by investing in United States dollar-denominated securities
described in each Prospectus for each class of shares of BNY Hamilton
Money Fund and in this Statement of Additional Information that meet
certain rating criteria, present minimal credit risks and have remaining
maturities of 397 days or less. See "Quality and Diversification
Requirements".
BNY Hamilton Treasury Money Fund (the "Treasury Money Fund") is designed
to be an economical and convenient means of investing in securities
issued or guaranteed by the United States Government and in securities
fully collateralized by issues of the United States Government. The
Fund's investment objective is to earn as high a level of current income
as is consistent with preservation of capital and maintenance of
liquidity by investing solely in short-term obligations of the United
States Treasury and repurchase agreements fully collateralized by
obligations of the United States Treasury. The Fund will only invest in
money market securities issued or guaranteed by the U.S. Government,
including but not limited to securities subject to repurchase agreements
secured by U.S. Government obligations. Securities issued or guaranteed
by the U.S. Government include U.S. Treasury securities which differ in
their interest rates, maturities, and times of issuance. In accordance
with Rule 2a-7 under the Investment Company Act of 1940, the Fund will
maintain a dollar-weighted average maturity of 90 days or less and will
only purchase securities having remaining maturity of 397 days or less.
See "Quality and Diversification Requirements".
3
<PAGE>
BNY Hamilton Equity Income Fund (the "Equity Income Fund") is designed
for conservative investors who are interested in participating in the
equity markets while receiving current income greater than the yield of
the Standard & Poor's 500 Index. The Fund's investment objectives are to
provide long-term capital appreciation greater than the appreciation of,
and yield greater than the yield of, the Standard & Poor's 500 Index.
Equal emphasis is placed on attaining income and capital appreciation.
The Fund will invest primarily in common stock and convertible securities
of domestic and foreign corporations. In connection with its investment
objectives, the Fund seeks to achieve capital appreciation in excess of
the market average represented by the Standard & Poor's 500 Index. During
periods of rapid market capital appreciation, the effect of the Fund's
dual investment objectives will likely be that the net asset value of the
Fund will not rise as rapidly as the market generally. Conversely, during
periods of rapid market depreciation, the Fund's net asset value would
not be expected to decline as rapidly as the market.
BNY Hamilton Large Cap Growth Fund (the "Large Cap Growth Fund") is
designed as an economical and convenient means of investing primarily in
the stocks of domestic and foreign institutions. The Fund's investment
objective is to provide long-term capital appreciation by investing
primarily in common stocks and securities convertible to common stocks;
current income is a secondary objective. During times of adverse market
and/or economic conditions the Fund may invest in securities with a high
enough yield to offer possible resistance to downward market and/or
economic pressure. In selecting securities for the Fund, a focus will be
given to securities of corporations perceived to have a relatively high
potential for growth of earnings and/or revenues. The Fund currently
considers large cap corporations to be those with market capitalization
of $3 billion or greater. In normal circumstances the Fund will invest at
least 65% of its assets in such equity securities.
BNY Hamilton Small Cap Growth Fund (the "Small Cap Growth Fund") is
designed for investors who are interested in obtaining capital growth by
investing in stocks of smaller corporations. The Small Cap Growth Fund's
investment objective is to provide long-term capital appreciation by
investing primarily in equity securities of small domestic and foreign
corporations. In selecting securities for the Small Cap Growth Fund a
focus will be given to securities of corporations perceived as having
potential for rapid growth in earnings or revenues due to expanded
operations, new products, new technologies, new channels of distribution,
revitalized management, general industry condition or other similar
advantageous circumstances. Current income will not be a consideration.
The Fund currently considers small corporations to be those with market
capitalization of $1.5 billion or less. In normal circumstances the Small
Cap Growth Fund will invest at least 65% of the value of its total assets
in such equity securities.
BNY Hamilton International Equity Fund (the "International Equity Fund")
is designed for more aggressive investors who wish to participate in
foreign markets. The Fund's investment objective is to provide long-term
capital appreciation through investing primarily in equity securities of
non-U.S. issuers. In normal circumstances, the Fund will invest in
securities principally traded in countries outside the United States. The
Fund may at any time include American Depository Receipts which are
United States securities representing foreign securities that are
deposited with foreign custodians or foreign branches of U.S. commercial
banks;
4
<PAGE>
American Depository Receipts are traded in U.S. dollars on national exchanges
and in over-the-counter markets. At any given time the Fund may invest 50% of
its assets in the securities principally traded in any one country, although
the Fund will ordinarily invest at least 65% of its total assets in at least
three (3) countries.
BNY Hamilton Intermediate Government Fund (the "Intermediate Government
Fund") is designed for conservative bond investors looking for a
relatively stable, high quality investment. See "Quality and
Diversification Requirements". The Fund's investment objective is to earn
as high a level of current income as is consistent with the preservation
of capital, moderate stability in net asset value and minimal credit
risk. The Fund will invest in obligations issued or guaranteed by the
United States Government and backed by the full faith and credit of the
United States. The Fund may also invest in obligations issued or
guaranteed by United States Government agencies or instrumentalities,
where the Fund must look principally to the issuing or guaranteeing
agency for ultimate repayment. The Fund may purchase or sell financial
futures contracts and options in an effort to reduce the volatility of
its portfolio, moderate market risk and minimize fluctuations in net
asset value. For a discussion of these investments, see "Hedging
Activities".
BNY Hamilton Intermediate Investment Grade Fund (the "Intermediate
Investment Grade Fund") is designed for bond investors who wish to invest
in debt obligations of both domestic and foreign corporations and
governments. The Intermediate Investment Grade Fund's investment
objective is to earn as high a level of current income as is consistent
with preservation of capital, moderate stability in net asset value and
maintenance of liquidity. In an effort to attain its investment
objective, the Fund will invest primarily in debt obligations of domestic
corporations, foreign corporations and foreign governments, as well as
obligations issued or guaranteed by the United States Government and its
agencies and instrumentalities. The debt securities the Fund invests in
will have ratings of at least investment grade quality, which would be a
rating no lower than BBB by Standard & Poor's Ratings Group ("S&P") and
Baa by Moody's Investors Services, Inc. ("Moody's"), or, if not rated,
such determined by the Adviser. In normal circumstances, the Fund will
invest at least 65% of its net assets in debt obligations of the
above-mentioned entities, but may at any time as determined appropriate
by the Adviser invest a substantial portion of the net assets in cash or
cash equivalents.
BNY Hamilton Intermediate New York Tax-Exempt Fund (the "Intermediate New
York Tax-Exempt Fund") is designed to be an economical and convenient
means of making substantial investments in debt obligations that are
exempt from federal, New York State and New York City income tax. The
Fund's investment objective is to provide investors with income that is
exempt from federal, New York State and New York City income taxes while
maintaining relative stability of principal. The Fund will invest
primarily in bonds issued by the State of New York and its political
subdivisions and by Puerto Rico and its political subdivisions. During
normal market conditions, the Adviser will attempt to invest 100%, and as
a fundamental policy at least 80%, of the Fund's total assets in bonds
and notes that are exempt from federal, New York State and New York City
income taxes. There may be occasions, due to market conditions or supply
limitations, when such securities are not available. In these situations,
the Adviser may invest in other fixed income securities that may be subject to
federal,
5
<PAGE>
New York State or New York City income taxes. Such investments would be
considered temporary. The Adviser will invest a portion of the Fund's assets in
short-term investments to provide liquidity. Investments in short-term
investments may be increased for defensive purposes if, in the opinion of the
Adviser, market conditions so warrant. The Fund seeks to maintain a current
yield that is greater than that obtainable from a portfolio of short-term
tax-exempt obligations, subject to certain quality restrictions. See "Quality
and Diversification Requirements". The Fund may seek to moderate market risk and
minimize fluctuations in its net asset value per share through the use of
financial futures contracts and options. See "Hedging Activities".
BNY Hamilton Intermediate Tax-Exempt Fund (the "Intermediate Tax-Exempt
Fund") is designed to be an economical and convenient means of making
substantial investments in debt obligations that are exempt from federal
income tax. A portion of the income recognized by the Intermediate
Tax-Exempt Fund may be exempt from state or local income tax as well;
consult with your tax adviser for details. The Intermediate Tax-Exempt
Fund's investment objective is to provide income that is exempt from
federal income taxes while maintaining relative stability of principal.
The Fund will attempt to invest 100%, and as a fundamental policy will
invest at least 80%, of its net assets in such investments. The
securities purchased by the Fund will be limited to be investment grade,
which means that investments cannot be rated lower than BBB by S&P and
Baa by Moody's. If the securities are not rated, the investment adviser
is to determine whether they are equivalent to investment grade
securities at the time of purchase. At any time, as deemed appropriate by
the Adviser, the Fund may hold a substantial portion of its net assets in
cash. The Fund may seek to moderate market risk and minimize fluctuations
in its net asset value per share through the use of financial futures and
options. See "Hedging Activities".
Throughout this Statement of Additional Information, the Money Fund and
the Treasury Money Fund are collectively referred to as the "Money Market
Funds"; the Equity Income Fund, the Large Cap Growth Fund, the Small Cap
Growth Fund, and the International Equity Fund are collectively referred
to as the "Equity Funds"; the Intermediate Government Fund and the
Intermediate Investment Grade Fund are collectively referred to as the
"Taxable Fixed Income Funds"; and the Intermediate New York Tax-Exempt
Fund and the Intermediate Tax-Exempt Fund are collectively referred to as
the "Tax-Exempt Fixed Income Funds".
The following discussion supplements the information regarding investment
objectives and policies of the respective Funds as set forth above and in
their respective prospectuses.
Government and Money Market Instruments
As discussed in the Prospectuses, each Fund may invest in money market
instruments to the extent consistent with its investment objectives and
policies. A description of the various types of money market instruments
that may be purchased by the Funds appears below. See "Quality and
Diversification Requirements".
6
<PAGE>
United States Government Obligations. Each of the Funds may invest in
obligations issued or guaranteed by the United States Government or by its
agencies or instrumentalities. Obligations issued or guaranteed by federal
agencies or instrumentalities may or may not be backed by the "full faith and
credit" of the United States. Securities that are backed by the full faith and
credit of the United States include Treasury bills, Treasury notes, Treasury
bonds, and obligations of the Government National Mortgage Association, the
Farmers Home Administration, and the Export-Import Bank. In the case of
securities not backed by the full faith and credit of the United States, each
Fund must look principally to the agency issuing or guaranteeing the
obligation for ultimate repayment and may not be able to assert a claim
against the United States itself in the event the agency or instrumentality
does not meet its commitments. Securities in which each Fund may invest that
are not backed by the full faith and credit of the United States include, but
are not limited to, obligations of the Tennessee Valley Authority, the Federal
National Mortgage Association and the United States Postal Service, each of
which has the right to borrow from the United States Treasury to meet its
obligations, and obligations of the Federal Farm Credit System and the Federal
Home Loan Banks, both of whose obligations may be satisfied only by the
individual credits of each issuing agency.
Foreign Government Obligations. Except for the Treasury Money Fund, each
of the Funds, subject to its applicable investment policies, may also
invest in short-term obligations of foreign sovereign governments or of
their agencies, instrumentalities, authorities or political subdivisions.
These securities may be denominated in United States dollars or, in the
case of the Equity Funds and Intermediate Investment Grade Fund, in
another currency. See "Foreign Investments".
Bank Obligations. Except for the Treasury Money Fund, each of the Funds,
unless otherwise noted in its relevant Prospectus or below, may invest in
negotiable certificates of deposit, time deposits and bankers'
acceptances of (i) banks, savings and loan associations and savings banks
that have more than $2 billion in total assets and are organized under
the laws of the United States or any state, (ii) foreign branches of
these banks or of foreign banks of equivalent size ("Euros") and (iii)
United States branches of foreign banks of equivalent size ("Yankees").
The Funds will not invest in obligations for which the Adviser, or any of
its affiliated persons, is the ultimate obligor or accepting bank. Each
of the Funds, other than the Tax-Exempt Fixed Income Funds, may also
invest in obligations of international banking institutions designated or
supported by national governments to promote economic reconstruction,
development or trade between nations (e.g., the European Investment Bank,
the Inter-American Development Bank, or the World Bank).
Commercial Paper. Except for the Treasury Money Fund, each of the Funds
may invest in commercial paper, including Master Notes. Master Notes are
obligations that provide for a periodic adjustment in the interest rate
paid and permit daily changes in the amount borrowed. Master Notes are
governed by agreements between the issuer and the Adviser acting as
agent, for no additional fee, in its capacity as investment adviser to
the Funds and as fiduciary for other clients for whom it exercises
investment discretion. The monies loaned to the borrower come from
accounts maintained with or managed by the Adviser or its affiliates
pursuant to arrangements with such accounts. Interest and principal
payments are credited to such accounts.
7
<PAGE>
The Adviser, acting as a fiduciary on behalf of its clients, has the right to
increase or decrease the amount provided to the borrower under an obligation.
The borrower has the right to pay without penalty all or any part of the
principal amount then outstanding on an obligation together with interest to
the date of payment.
Since these obligations typically provide that the interest rate is tied to
the Treasury bill auction rate, the rate on Master Notes is subject to change.
Repayment of Master Notes to participating accounts depends on the ability of
the borrower to pay the accrued interest and principal of the obligation on
demand which is continuously monitored by the Adviser. Since Master Notes
typically are not rated by credit rating agencies, the Funds may invest in
such unrated obligations only if at the time of an investment the obligation
is determined by the Adviser to have a credit quality that satisfies such
Fund's quality restrictions. See "Quality and Diversification Requirements".
Although there is no secondary market for Master Notes, such obligations are
considered by the Funds to be liquid because they are payable immediately upon
demand. The Funds do not have any specific percentage limitation on
investments in Master Notes.
Repurchase Agreements. Each of the Funds may enter into repurchase
agreements with brokers, dealers or banks that meet the credit guidelines
approved by the Board of Directors of BNY Hamilton Funds, Inc. (the
"Directors"). In a repurchase agreement, a Fund buys a security from a
seller that has agreed to repurchase the same security at a mutually
agreed upon date and price. The resale price is normally in excess of the
purchase price, reflecting an agreed upon interest rate. This interest
rate is effective for the period of time the Fund is invested in the
agreement and is not related to the coupon rate on the underlying
security. A repurchase agreement may also be viewed as a fully
collateralized loan of money by a Fund to the seller. The period of these
repurchase agreements will usually be short, from overnight to one week,
and at no time will the Funds invest in repurchase agreements for more
than one year. The securities that are subject to repurchase agreements,
however, may have maturity dates in excess of one year from the effective
date of the repurchase agreement. The Funds will always receive
securities as collateral whose market value is, and during the entire
term of the agreement remains, at least equal to 100% of the dollar
amount invested by the Funds in each agreement plus accrued interest, and
the Funds will make payment for such securities only upon physical
delivery or upon evidence of book entry transfer to the account of the
Funds' custodian. If the seller defaults, a Fund might incur a loss if
the value of the collateral securing the repurchase agreement declines
and might incur disposition costs in connection with liquidating the
collateral. In addition, if bankruptcy proceedings are commenced with
respect to the seller of the security, realization upon the collateral by
a fund may be delayed or limited. See "Investment Restrictions" in the
Prospectuses and this Statement of Additional Information.
Corporate Bonds and Other Debt Securities
As discussed in the Prospectus for the Taxable Fixed Income Funds, the
Intermediate Government Fund and Intermediate Investment Grade Fund may
invest in bonds and other debt securities of domestic issuers to the
extent consistent with their investment objectives and policies. A
description of these investments appears in the Prospectus for the
Taxable Fixed
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Income Funds and below. See "Quality and Diversification Requirements". For
information on short-term investments in these securities, see "Money Market
Instruments".
Asset-Backed Securities. Asset-backed securities directly or indirectly
represent a participation interest in, or are secured by and payable
from, a stream of payments generated by particular assets such as motor
vehicle or credit card receivables. Payments of principal and interest
may be guaranteed up to certain amounts and for a certain time period by
a letter of credit issued by a financial institution unaffiliated with
the entities issuing the securities. The asset-backed securities in which
a Fund may invest are subject to the Fund's overall credit requirements.
Asset-backed securities in general, however, are subject to certain
risks. Most of these risks are related to limited interests in applicable
collateral. For example, credit card debt receivables are generally
unsecured and the debtors are entitled to the protection of a number of
state and federal consumer credit laws, many of which give such debtors
the right to set off certain amounts on credit card debt, thereby
reducing the balance due. Additionally, if the letter of credit is
exhausted, holders of asset-backed securities may also experience delays
in payments or losses if the full amounts due on underlying sales
contracts are not realized.
Mortgage-Backed Securities. Mortgage-backed securities are often subject
to more rapid repayment than their stated maturity date would indicate as
a result of the pass-through of prepayments of principal on the
underlying mortgage obligations. During periods of declining interest
rates, prepayment of mortgages underlying mortgage-backed securities can
be expected to accelerate. Accordingly, a Fund's ability to maintain
positions in mortgage-backed securities will be affected by reductions in
the principal amount of such securities resulting from such prepayments,
and its ability to reinvest the returns of principal at comparable yields
is subject to generally prevailing interest rates at that time. A Fund's
net asset value per share for each class will vary with changes in the
values of its portfolio securities. To the extent that a Fund invests in
mortgage-backed securities, such values will vary with changes in market
interest rates generally and the differentials in yields among various
kinds of mortgage-backed securities.
Tax-Exempt Obligations
As discussed in the Prospectus for the Tax-Exempt Fixed Income Funds, the
Intermediate New York Tax-Exempt Fund and the Intermediate Tax-Exempt
Fund may invest in tax-exempt obligations to the extent consistent with
the Fund's investment objective and policies. A description of the
various types of tax-exempt obligations that the Tax-Exempt Fixed Income
Funds may purchase appears below. See "Quality and Diversification
Requirements".
Municipal Bonds. Municipal bonds are debt obligations issued by the
states, territories and possessions of the United States and the District
of Columbia, by their political subdivisions and by duly constituted
authorities and corporations. For example, states, territories,
possessions and municipalities may issue municipal bonds to raise funds
for various public purposes such as airports, housing, hospitals, mass
transportation, schools, water and sewer works. They may also issue
municipal bonds to refund outstanding obligations and to meet general
operating expenses. Public authorities issue municipal bonds to obtain
funding for privately operated
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facilities, such as housing and pollution control facilities, for industrial
facilities and for water supply, gas, electricity and waste disposal
facilities.
Municipal bonds may be general obligation or revenue bonds. General
obligation bonds are secured by the issuer's pledge of its full faith,
credit and taxing power for the payment of principal and interest.
Revenue bonds are payable from revenues derived from particular
facilities, from the proceeds of a special excise tax or from other
specific revenue sources. They are not usually payable from the general
taxing power of a municipality.
Municipal Notes. Municipal notes are subdivided into three categories of
short-term obligations: municipal notes, municipal commercial paper and
municipal demand obligations.
Municipal notes are short-term obligations with a maturity at the time of
issuance normally ranging up to one year. The principal types of
municipal notes include tax anticipation notes, bond anticipation notes,
revenue anticipation notes, grant anticipation notes and project notes.
Notes sold in anticipation of collection of taxes, a bond sale, or
receipt of other revenues are usually general obligations of the issuing
municipality or agency.
Municipal commercial paper typically consists of very short-term,
unsecured, negotiable promissory notes that are sold to meet the seasonal
working capital or interim construction financing needs of a municipality
or agency. While these obligations are intended to be paid from general
revenues or refinanced with long-term debt, they frequently are backed by
letters of credit, lending agreements, note repurchase agreements or
other credit facility agreements offered by banks or institutions.
Municipal demand obligations are subdivided into two types: Variable Rate
Demand Notes and Master Notes.
Variable Rate Demand Notes are tax-exempt municipal obligations or
participation interests that provide for a periodic adjustment in the
interest rate paid on the notes. They permit the holder to demand payment
of the notes, or to demand purchase of the notes at a purchase price
equal to the unpaid principal balance plus accrued interest, either
directly by the issuer or by drawing on a bank letter of credit or
guaranty issued with respect to such note. The issuer of the Variable
Rate Demand Note may have a corresponding right to prepay at its
discretion the outstanding principal of the note plus accrued interest
upon notice comparable to that required for the holder to demand payment.
The Variable Rate Demand Notes in which each Fund may invest are payable,
or are subject to purchase, on demand usually on notice of seven calendar
days or less. The terms of the notes will provide that interest rates are
adjustable at intervals ranging from daily to six months, and the
adjustments are usually based upon the prime rate of a bank or other
appropriate interest rate index specified in the respective notes.
Master Notes are tax-exempt municipal obligations that provide for a
periodic adjustment in the interest rate paid and permit daily changes in
the amount borrowed. The interest on such obligations is, in the opinion
of counsel for the borrower, exempt from federal income tax. For a
description of the attributes of Master Notes, see "Money Market
Instruments" above. Although
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there is no secondary market for Master Notes, such obligations are considered
by each Fund to be liquid because they are payable immediately upon demand.
The Funds have no specific percentage limitations on investments in Master
Notes.
Puts. The Tax-Exempt Fixed Income Funds may purchase, without limit,
municipal bonds or notes together with the right to resell the bonds or
notes to the seller at an agreed price or yield within a specified period
prior to the maturity date of the bonds or notes. In addition, the
Taxable Fixed Income Funds may purchase notes together with the rights
described above. Such a right to resell is commonly known as a "put". The
aggregate price for bonds or notes with puts may be higher than the price
for bonds or notes without puts. Consistent with a Fund's investment
objective and subject to the supervision of the Directors, the purpose of
this practice is to permit a Fund to be fully invested in securities
(tax-exempt securities in the case of the Tax-Exempt Fixed Income Funds)
while preserving the necessary liquidity to purchase securities on a
when-issued basis, to meet unusually large redemptions, and to purchase
at a later date securities other than those subject to the put. The
principal risk of puts is that the writer of the put may default on its
obligation to repurchase. The Adviser will monitor each writer's ability
to meet its obligations under puts.
Puts may be purchased as a feature of the underlying bond or note, or as
an independent security. When a Tax-Exempt Fixed Income Fund or a Taxable
Fixed Income Fund purchases puts as independent securities, it may
exercise the puts prior to their expiration date in order to fund
obligations to purchase other securities or to meet redemption requests.
These obligations may arise during periods in which proceeds from sales
of Fund shares and from recent sales of portfolio securities are
insufficient to meet obligations or when the funds available are
otherwise allocated for investment. In addition, puts may be exercised
prior to the expiration date in order to take advantage of alternative
investment opportunities or in the event the Adviser revises its
evaluation of the creditworthiness of the issuer of the underlying
security. In determining whether to exercise puts prior to their
expiration date and in selecting which puts to exercise, the Adviser will
consider the amount of cash available to the Fund, the expiration dates
of the available puts, any future commitments for securities purchases,
alternative investment opportunities, the desirability of retaining the
underlying securities in the Fund's portfolio and the yield, quality and
maturity dates of the underlying securities.
The Tax-Exempt Fixed Income Funds and the Taxable Fixed Income Funds will
value any securities subject to puts with remaining maturities of less
than 60 days by the amortized cost method. If the Intermediate New York
Tax-Exempt Fund invests in municipal bonds and notes with maturities of
60 days or more that are subject to puts separate from the underlying
securities, the puts and the underlying securities will be valued at fair
value as determined in accordance with procedures established by the
Directors. The Directors will, in connection with the determination of
the value of a put, consider, among other factors, the creditworthiness
of the writer of the put, the duration of the put, the dates on which or
the periods during which the put may be exercised and the applicable
rules and regulations of the Securities and Exchange Commission. Prior to
investing in such securities, a Fund, if deemed necessary based upon the
advice of counsel, will apply to the Securities and Exchange Commission
for an exemptive order, which may not be granted, relating to the
valuation of such securities.
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Since the value of a put is partly dependent on the ability of the put
writer to meet its obligation to repurchase, the policy of the Tax-Exempt
Fixed Income Funds and the Taxable Fixed Income Funds is to enter into
put transactions only with securities dealers or issuers who are approved
by the Adviser. Each dealer will be approved on its own merits, and it is
a Fund's general policy to enter into put transactions only with those
dealers that are determined to present minimal credit risks. In
connection with such determination, the Directors will review regularly
the Adviser's list of approved dealers, taking into consideration, among
other things, the ratings, if available, of their equity and debt
securities, their reputation in the securities markets, their net worth,
their efficiency in consummating transactions and any collateral
arrangements, such as letters of credit, securing the puts written by
them. Commercial bank dealers normally will be members of the Federal
Reserve System, and other dealers will be members of the National
Association of Securities Dealers, Inc. or members of a national
securities exchange. Other put writers will have outstanding debt rated
in the highest rating categories as determined by a Nationally Recognized
Statistical Rating Organization ("NRSRO"). Currently, there are six
NRSROs: Moody's, S&P, Fitch Investors Services, L.P., Duff and
Phelps/MCM, IBCA Limited and its affiliate, IBCA, Inc. and Thomson
Bankwatch. If a put writer is not rated by an NRSRO, it must be of
comparable quality in the Adviser's opinion or such put writers'
obligations will be collateralized and of comparable quality in the
Adviser's opinion. The Directors have directed the Adviser not to enter
into put transactions with any dealer that in the judgment of the Adviser
present more than a minimal credit risk. In the event that a dealer
should default on its obligation to repurchase an underlying security, a
Fund is unable to predict whether all or any portion of any loss
sustained could subsequently be recovered from such dealer.
BNY Hamilton Funds, Inc. has been advised by counsel that the Funds
should be considered the owner of the securities subject to the puts so
that the interest on the securities is tax-exempt income to the
Tax-Exempt Fixed Income Funds. Such advice of counsel is based on certain
assumptions concerning the terms of the puts and the attendant
circumstances.
Equity Investments
As discussed in the Prospectus for the Equity Funds, the Equity Income
Fund, the Large Cap Growth Fund, the Small Cap Growth Fund and the
International Equity Fund may invest in common stocks and securities
convertible into common stocks to the extent consistent with its
investment objective and policies. The securities in which the Equity
Funds may invest include those listed on any domestic or foreign
securities exchange or traded in the over-the-counter market. A
discussion of the various types of equity investments which may be
purchased by the Equity Funds appears in the Prospectus for the Equity
Funds and below. See "Quality and Diversification Requirements".
Equity Securities. The common stock in which the Equity Funds may invest
includes the common stock of any class or series of domestic or foreign
corporations or any similar equity interest, such as trust or partnership
interest. These investments may or may not pay dividends
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and may or may not carry voting rights. Common stock occupies the most junior
position in a company's capital structure.
Convertible Securities. The convertible securities in which the Equity
Funds may invest include any debt securities or preferred stock that may
be converted into common stock or that carry the right to purchase common
stock. Convertible securities entitle the holder to exchange the
securities for a specified number of shares of common stock, usually of
the same company, at specified prices within a certain period of time.
They also entitle the holder to receive interest or dividends until the
holder elects to exercise the conversion privilege.
The terms of any convertible security determine its ranking in a
company's capital structure. In the case of subordinated convertible
debentures, the holders' claims on assets and earnings are subordinated
to the claims of other creditors and are senior to the claims of
preferred and common shareholders. In the case of convertible preferred
stock, the holders' claims on assets and earnings are subordinated to the
claims of all creditors and are senior to the claims of common
shareholders.
Foreign Investments
The Money Fund, the Equity Income Fund, the Large Cap Growth Fund, the
Small Cap Growth Fund, the International Equity Fund and the Intermediate
Investment Grade Fund may invest in certain foreign securities. The Money
Fund does not expect to invest more than 65% of its total assets at the
time of purchase in securities of foreign issuers. The Equity Income
Fund, the Large Cap Growth Fund, the Small Cap Growth Fund and the
Intermediate Investment Grade Fund do not expect to invest more than 20%
of their respective total assets at the time of purchase in securities of
foreign issuers. All investments of the Money Fund must be United States
dollar-denominated. The Equity Income Fund, the Large Cap Growth Fund,
the Small Cap Growth Fund and the Intermediate Investment Grade Fund do
not expect more than 15% of their respective foreign investments to be in
securities that are not either listed on a securities exchange or United
States dollar-denominated. In the case of the Money Fund, any foreign
commercial paper must not be subject to foreign withholding tax at the
time of purchase. Foreign investments may be made directly in securities
of foreign issuers or in the form of American Depository Receipts
("ADRs") and Global Depository Receipts ("GDRs"). Generally, ADRs and
GDRs are receipts issued by a bank or trust company that evidence
ownership of underlying securities issued by a foreign corporation and
that are designed for use in the domestic, in the case of ADRs, or
global, in the case of GDRs, securities markets.
Since investments in foreign securities may involve foreign currencies,
the value of a Fund's assets as measured in United States dollars may be
affected by changes in currency rates and in exchange control
regulations, including currency blockage. The Equity Funds may enter into
forward commitments for the purchase or sale of foreign currencies in
connection with the settlement of foreign securities transactions or to
hedge the underlying currency exposure related to foreign investments,
but they will not enter into such commitments for speculative purposes.
See "Additional Investment Information" in the Prospectus for the Equity
Funds.
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For a description of the risks associated with investing in foreign
securities, see "Additional Investment Information" in the Prospectuses for
the Money Market Funds, the Equity Funds and the Taxable Fixed Income Funds.
To the extent that the Tax-Exempt Fixed Income Funds invest in municipal bonds
and notes backed by credit support arrangements with foreign financial
institutions, the risks associated with investing in foreign securities may be
relevant.
Additional Investments
When-Issued and Delayed Delivery Securities. Each of the Funds may
purchase securities on a when-issued or delayed delivery basis. For
example, delivery of and payment for these securities can take place a
month or more after the date of the purchase commitment. The purchase
price and the interest rate payable, if any, on the securities are fixed
on the purchase commitment date or at the time the settlement date is
fixed. The value of such securities is subject to market fluctuation and
no interest accrues to a Fund until settlement takes place. At the time a
Fund makes the commitment to purchase securities on a when-issued or
delayed delivery basis, it will record the transaction, reflect the value
each day of such securities in determining its net asset value and, if
applicable, calculate the maturity for the purposes of average maturity
from that date. At the time of its acquisition, a when-issued security
may be valued at less than the purchase price. A Fund will make
commitments for such when-issued transactions only when it has the
intention of actually acquiring the securities. To facilitate such
acquisitions, each Fund will maintain with the custodian a segregated
account with liquid assets, consisting of cash, U.S. Government
securities or other appropriate securities, in an amount at least equal
to such commitments. On delivery dates for such transactions, each Fund
will meet its obligations from maturities or sales of the securities held
in the segregated account and/or from cash flow. If a Fund chooses to
dispose of the right to acquire a when-issued security prior to its
acquisition, it could, as with the disposition of any other portfolio
obligation, incur a gain or loss due to market fluctuation. It is the
current policy of each Fund not to enter into when-issued commitments
exceeding in the aggregate 25% of the market value of the Fund's total
assets, less liabilities other than the obligations created by
when-issued commitments.
Investment Company Securities. The Equity Funds, the Taxable Fixed Income
Funds, and the Tax-Exempt Fixed Income Funds may invest in the securities
of other investment companies to the extent permitted under the
Investment Company Act of 1940 (the "1940 Act"). These limits require
that, as determined immediately after a purchase is made, (i) not more
than 5% of the value of the Fund's total assets will be invested in the
securities of any one investment company, (ii) not more than 10% of the
value of its total assets will be invested in the aggregate in securities
of investment companies as a group and (iii) not more than 3% of the
outstanding voting stock of any one investment company will be owned by
the Fund. As a shareholder of another investment company, a Fund would
bear, along with other shareholders, its pro rata portion of the other
investment company's expenses, including advisory fees. These expenses
would be in addition to the advisory and other expenses that a Fund bears
directly in connection with its own operations.
Reverse Repurchase Agreements. Except for the Treasury Money Fund, each
of the Funds may enter into reverse repurchase agreements. In a reverse
repurchase agreement, a Fund sells a
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security and agrees to repurchase the same security at a mutually agreed upon
date and price. This may also be viewed as the borrowing of money by a Fund.
The Funds will invest the proceeds of borrowings under reverse repurchase
agreements. In addition, the Funds will enter into a reverse repurchase
agreement only when the interest income to be earned from the investment of
the proceeds is greater than the interest expense of the transaction. The
Funds will not invest the proceeds of a reverse repurchase agreement for a
period which exceeds the duration of the reverse repurchase agreement. A Fund
may not enter into reverse repurchase agreements exceeding in the aggregate
one-third of the market value of its total assets, less liabilities other than
the obligations created by reverse repurchase agreements. Each Fund will
establish and maintain with the Custodian a separate account with a segregated
portfolio of securities in an amount at least equal to its purchase
obligations under its reverse repurchase agreements. If interest rates rise
during the term of a reverse repurchase agreement, entering into the reverse
repurchase agreement may have a negative impact on the Money Fund's ability to
maintain a net asset value of $1.00 per share. See "Investment Restrictions".
Loans of Portfolio Securities. The Equity Funds, the Taxable Fixed Income
Funds and the Tax-Exempt Fixed Income Funds may lend securities if such
loans are secured continuously by liquid assets consisting of cash, U.S.
Government securities or other liquid, high-grade debt securities or by a
letter of credit in favor of the Fund at least equal at all times to 100%
of the market value of the securities loaned, plus accrued interest.
While such securities are on loan, the borrower will pay the Fund any
income accruing thereon. Loans will be subject to termination by the
Funds in the normal settlement time, currently three Business Days after
notice, or by the borrower on one day's notice (as used herein, "Business
Day" shall denote any day on which the New York Stock Exchange and the
custodian are both open for business). Borrowed securities must be
returned when the loan is terminated. Any gain or loss in the market
price of the borrowed securities that occurs during the term of the loan
inures to the lending fund and its shareholders. The Funds may pay
reasonable finders' and custodial fees in connection with loans. In
addition, the Funds will consider all facts and circumstances including
the creditworthiness of the borrowing financial institution, and the
Funds will not make any loans for terms in excess of one year. The Funds
will not lend their securities to any director, officer, employee, or
affiliate of BNY Hamilton Funds, Inc., or the Adviser, the Administrator
or the Distributor, unless permitted by applicable law.
Privately Placed and Certain Unregistered Securities. The Equity Funds,
the Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds may
invest in privately placed, restricted, Rule 144A and other unregistered
securities as described in their respective Prospectuses.
Quality and Diversification Requirements
Each of the Funds except the Intermediate New York Tax-Exempt Fund is
classified as a "diversified" series of a registered investment company
under the 1940 Act. This means that with respect to 75% of its total
assets (1) the Fund may not invest more than 5% of its total assets in
the securities of any one issuer, except obligations of the United States
Government, its agencies and instrumentalities, and (2) the Fund may not
own more than 10% of the outstanding
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voting securities of any one issuer. As for the remaining 25% of each Fund's
assets not subject to the limitations described above, there is no such
limitation on investment of these assets under the 1940 Act, so that all of
such assets may be invested in the securities of any one issuer, subject to
the limitation of any applicable state securities laws, or, with respect to
the Money Market Funds, as described below. Investments not subject to the
limitations described above could involve an increased risk to a Fund should
an issuer, or a state or its related entities, be unable to make interest or
principal payments or should the market value of such securities decline.
The Intermediate New York Tax-Exempt Fund is classified as a
non-diversified series of a registered investment company so that it is
not limited by the 1940 Act as to the proportion of its assets that it
may invest in the obligations of a single issuer. However, the Fund will
comply with the diversification requirements of the Internal Revenue Code
of 1986, as amended (the "Tax Code"), and has therefore adopted an
investment restriction, which applies to 50% of the value of the assets
of the Fund and which may not be changed without shareholder vote,
prohibiting the Fund from purchasing securities of any issuer if, as a
result, more than 5% of the assets of the Fund would be invested in the
securities of a single issuer. See "Investment Restrictions". The Fund
also intends to comply with the diversification requirements of the Tax
Code, for qualification thereunder as a regulated investment company. See
"Taxes". As a nondiversified series of an investment company, the
Intermediate New York Tax-Exempt Fund may be more susceptible to adverse
economic, political or regulatory developments affecting a single issuer
than would be the case if the Fund were a diversified company.
With respect to the Intermediate New York Tax-Exempt Fund, for purposes of
diversification and concentration under the 1940 Act, identification of the
issuer of municipal bonds or notes depends on the terms and conditions of the
obligation. If the assets and revenues of an agency, authority, instrumentality
or other political subdivision are separate from those of the government
creating the subdivision and the obligation is backed only by the assets and
revenues of the subdivision, such subdivision is regarded as the sole issuer.
Similarly, in the case of an industrial development revenue bond or pollution
control revenue bond, if the bond is backed only by the assets and revenues of
the non-governmental user, the non-governmental user is regarded as the sole
issuer. If in either case the creating government or another entity guarantees
an obligation, the guaranty is regarded as a separate security and treated as an
issue of such guarantee. Since securities issued or guaranteed by states or
municipalities are not voting securities, there is no limitation on the
percentage of a single issuer's securities that a Fund may own so long as it
does not invest more than 5% of its total assets that are subject to the
diversification limitation in the securities of such issuer, except obligations
issued or guaranteed by the United States Government. Consequently, the Fund may
invest in a greater percentage of the outstanding securities of a single issuer
than would an investment company that invests in voting securities. See
"Investment Restrictions".
Money Market Funds. In order to attain its objective of maintaining a
stable net asset value of $1.00 per share for each of its respective
classes, each of the Money Market Funds will (i) limit its investment in
the securities (other than U.S. Government securities) of any one issuer
to no more than 5% of the Fund's assets, measured at the time of
purchase, except for investments
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held for not more than three Business Days (subject, however, to each Fund's
investment restriction No. 4 set forth under "Investment Restrictions" below);
and (ii) limit investments to securities that present minimal credit risks.
In order to limit the credit risk of the Money Fund's investments, it
will not purchase any security (other than a United States Government
security) unless it is rated in the highest rating category assigned to
short-term debt securities (so-called "first tier" securities) by at
least two NRSROs such as Moody's (i.e., P-1 rating) and S&P (i.e., A-1
rating) or, if not so rated, it is determined to be of comparable
quality. Determinations of comparable quality will be made in accordance
with procedures established by the Directors. These standards must be
satisfied at the time an investment is made. If the quality of the
investment later declines, the Money Fund may continue to hold the
investment, subject in certain circumstances to a finding by the
Directors that disposing of the investment would not be in the Money
Fund's best interest.
In addition, the Directors have adopted procedures that (i) require each
Money Market Fund to maintain a dollar-weighted average portfolio
maturity of not more than 90 days and to invest only in securities with a
remaining maturity of 397 days or less, and (ii) require each Money
Market Fund, in the event of certain downgradings of or defaults on
portfolio holdings, to reassess promptly whether the security presents
minimal credit risks and, in certain circumstances, to determine whether
continuing to hold the security is in the best interests of each Money
Market Fund.
Equity Funds. The Equity Funds may invest in convertible debt securities,
for which there are no specific quality requirements. In addition, at the
time the Equity Funds invest in any commercial paper, bank obligation or
repurchase agreement, the issuer must have outstanding debt rated A or
higher by Moody's or S&P; the issuer's parent corporation, if any, must
have outstanding commercial paper rated Prime-2 or better by Moody's or
A-2 or better by S&P; or if no such ratings are available, the investment
must be of comparable quality in the Adviser's opinion. At the time an
Equity Fund invests in any other short-term debt securities, they must be
rated A or higher by Moody's or S&P, or if unrated, the investment must
be of comparable quality in the Adviser's opinion.
Taxable Fixed Income Funds. During normal market conditions, each of the
Taxable Fixed Income Funds' portfolios will have a dollar weighted
average maturity of not less than three nor more than ten years. In
addition, the Intermediate Investment Grade Fund will not purchase a
security with a maturity date of greater than fifteen years at the time
of purchase. The Intermediate Government Fund's portfolio will, and the
Intermediate Investment Grade Fund's portfolio may, include a variety of
securities that are issued or guaranteed by the United States Treasury,
by various agencies of the United States Government or by various
instrumentalities that have been established or sponsored by the United
States Government. Under normal market conditions, the Intermediate
Government Fund will invest at least 65% of the value of its total assets
in Government securities.
Tax-Exempt Fixed Income Funds. The Intermediate New York Tax-Exempt Fund
invests principally in a portfolio of "high quality" and "investment
grade" New York municipal bonds.
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The Intermediate Tax-Exempt Fund invests principally in such municipal bonds
from throughout the United States. For purposes of the Intermediate New York
Tax-Exempt Fund, on the date of investment (i) New York municipal bonds must
be rated within the four highest ratings of Moody's, currently Aaa, Aa, A and
Baa, or of S&P, currently AAA, AA, A and BBB, (ii) New York short-term
municipal obligations must be rated MIG-2 or higher by Moody's or SP-1 or
higher by S&P and (iii) New York tax-exempt commercial paper must be rated
Prime-1 or higher by Moody's or A-1 or higher by S&P or, if not rated by
either Moody's or S&P, issued by an issuer either (a) having an outstanding
debt issue rated A or higher by Moody's or S&P or (b) having comparable
quality in the opinion of the Adviser. Each Fund may invest in other
tax-exempt securities that are not rated if, in the opinion of the Adviser,
such securities are of comparable quality to securities in the rating
categories discussed above. In addition, at the time a Fund invests in any
commercial paper, bank obligation or repurchase agreement, the issuer must
have outstanding debt rated A or higher by Moody's or S&P, the issuer's parent
corporation, if any, must have outstanding commercial paper rated Prime-1 by
Moody's or A-1 by S&P, or if no such ratings are available, the investment
must be of comparable quality in the Adviser's opinion.
In determining suitability of investment in a particular unrated
security, the Adviser takes into consideration asset and debt service
coverage, the purpose of the financing, history of the issuer, existence
of other rated securities of the issuer, and other relevant conditions,
such as comparability to other issuers.
Hedging Activities
Hedging is a means of transferring risk that an investor does not desire
to assume during an uncertain market environment. In the case of the
income funds, interest rates have become increasingly volatile in recent
years, and with the advent of financial futures contracts, options on
financial instruments and indexes of debt securities, the Adviser
believes it is now possible to reduce the effects of interest rate
fluctuations.
Taxable Fixed Income Funds and Tax-Exempt Fixed Income Funds. The Taxable
Fixed Income Funds and the Tax-Exempt Fixed Income Funds may (i) sell
futures contracts on debt securities and indexes of debt securities and
(ii) purchase or write (sell) options on such futures and options on debt
securities and on indexes of debt securities. The Tax-Exempt Fixed Income
Funds may also enter into the above-described transactions with respect
to municipal debt securities and on indexes of municipal debt securities.
The purpose of any such transaction is to hedge against changes in the
market value of securities in the Fund's portfolio caused by fluctuating
interest rates, and to close out or offset existing positions in such
futures contracts or options. The Taxable Fixed Income Funds and the
Tax-Exempt Fixed Income Funds will not engage in financial futures or
options transactions for speculation, but only as a hedge against changes
in the market values of securities held by the Funds and where the
transactions are appropriate to reduction of risk. The Taxable Fixed
Income Funds and Tax-Exempt Fixed Income Funds may not enter into futures
contracts or related options if, immediately thereafter, the sum of the
amount of initial and variation margin deposits on outstanding futures
contracts and premiums paid for related options would exceed 20% of the
market value of their respective
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total assets. In addition, the Taxable Fixed Income Funds and the Tax-Exempt
Fixed Income Funds may not enter into futures contracts or purchase or sell
related options (other than offsetting existing positions) if immediately
thereafter the sum of the amount of initial margin deposits on outstanding
futures contracts and premiums paid for related options would exceed 5% of the
market value of their respective total assets.
Special Considerations Relating to Hedging Activities. Each of the
Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds may take
positions in financial futures contracts and options traded on registered
securities exchanges and contract markets solely as a hedge. However, for
a hedge to be completely successful, the price changes of the hedging
instruments should equal the price changes of the securities being
hedged. To the extent the hedging instrument utilized does not involve
specific securities in the portfolio, such equal price changes will not
always be possible. Thus, hedging activities may not be completely
successful in eliminating market value fluctuations of the portfolios.
When using hedging instruments that do not specifically correlate with
securities in a Fund's portfolio, the Adviser will attempt to create a
very closely correlated hedge. In particular, hedging activities of the
Tax-Exempt Fixed Income Funds based upon non-municipal debt securities or
indexes may not correlate as closely to a Tax-Exempt Fixed Income Fund's
portfolio as hedging activities based upon municipal debt securities or
indexes. Nevertheless, hedging activities may be useful to the Tax-Exempt
Fixed Income Funds, especially where closely correlated hedging
activities based upon municipal securities or indexes are not available.
See "Risks Associated with Futures Contracts" below. Further, the use of
options rather than financial futures contracts to hedge portfolio
securities may result in partial hedges because of the limits inherent in
the exercise prices.
Risks in the use of futures contracts result from the possibility that
changes in market interest rates may differ substantially from the
changes anticipated when hedge positions were established. For example,
if any of the Funds has hedged against the possibility of an increase in
interest rates and instead interest rates decline, the value of the
Fund's portfolio will increase, but the Fund will lose at least part of
the benefit of that increased value because it will have losses in its
futures positions. In addition, in such situations, if the Fund has
insufficient cash, it may have to sell securities to meet daily
maintenance margin requirements resulting from losses in its futures
positions.
While the Funds will not ordinarily incur brokerage commissions on the
portfolio securities that they purchase, each Fund will pay brokerage
commissions on its financial futures and options transactions. The Funds
will also incur premium costs for purchasing put and call options.
Brokerage commissions and premium costs may tend to reduce the yield of
the Funds.
Each Fund's ability to engage in hedging activities and certain portfolio
transactions may be further limited by various investment restrictions of
a specific Fund and certain income tax considerations. For example, the
amount of assets that a specific Fund is permitted to invest in option
and futures contracts is limited as described above; furthermore, the
limitations on the percentage of gross income that a specific Fund may
realize from transactions in these securities may restrict its ability to
effect transactions in these securities. See "Taxes".
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Financial Futures Contracts. Financial futures obligate the seller to
deliver a specific type of security called for in the contract, at a
specified future time, and for a specified price. Financial futures may
be satisfied by actual delivery of the securities or by entering into an
offsetting transaction. In offsetting or closing out an existing futures
position, the seller of the original contract enters into a futures
contract to take delivery of the same security at the same time as
specified in the original futures contract.
Although financial futures contracts, by their terms, call for actual
delivery or acceptance of securities, in most cases the contracts are
closed out before the settlement date without making or taking delivery
of the securities. Closing out is accomplished by an offsetting
transaction as described above. If the price in the offsetting
transaction (purchase) varies from the price in the original futures
contract (sale), the seller will realize a gain or loss on the
transaction. That gain or loss will tend to offset in whole or in part
the unrealized loss or gain that the securities held in the Funds'
portfolio have experienced, but may not always do so.
A public market exists in financial futures covering a number of debt
securities, including long-term United States Treasury bonds, ten-year
United States Treasury notes, Government National Mortgage Association
modified pass-through mortgage-backed certificates, three-month United
States Treasury bills, three-month domestic bank certificates of deposit
and three-month Eurodollar certificates of deposit. A public market also
exists for futures contracts on The Bond Buyer Index of forty long-term
municipal bonds. In addition, other financial futures contracts may be
developed and traded. The Funds may utilize any such contracts and
associated put and call options for which there is an active trading
market. Financial futures are traded on contract markets such as the
Chicago Board of Trade and the New York Futures Exchange, which are
regulated by the Commodity Futures Trading Commission, a federal agency.
When futures contracts are entered into, both buyer and seller are
required, under regulations of the applicable contract market, to post
good faith deposits with the brokers handling the trades or with a third
party custodian as security for the performance of their promise to buy
or sell securities. This deposit, the amount of which is determined by
the contract market on which the futures contract is traded, is called
"initial margin". Each day, the investor's account will be credited with
any net gains due to favorable price movements during the day's trading
of contracts. Similarly, net losses, due to unfavorable price movements
during the day, will require the investor to make additional deposits to
the account. These daily settlement payments are called "variation
margin". Initial margin requirements are established by the contract
markets and may be changed, but brokers may require their customers to
maintain margins higher than those established by the contract markets.
In financial futures trading, margin does not involve any loan or
borrowing. Instead, it is a good faith deposit in the case of initial
margin and a daily settlement of gains and losses in the case of
variation margin. Initial margin deposits are held by the broker or a
third party custodian in a segregated customer account in the name of the
investor, with the investor retaining all rights and claims of ownership
pursuant to federal regulation. The initial margin deposits may be in the
form of liquid securities such as Treasury bills or bonds, the interest
on which accrues to the
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investor, and which are returned to the investor when it closes out a
financial futures position. Variation margin calls and payments must be made
in cash.
The sale of futures contracts is for the purpose of hedging a Fund's
securities portfolio. For example, if interest rates were expected to
increase, a Fund might sell futures contracts. If interest rates did
increase, the value of the securities in the portfolio would decline. The
value of a Fund's hedging instruments would increase at approximately the
same rate (depending on the correlation between value in the futures
markets and the prices of the Fund's portfolio securities and limits,
under regulations of the applicable contract market, on the price
movements per day of the hedging instrument), thereby offsetting all or
part of such decline in the value of the underlying portfolio securities.
A Fund could accomplish similar results by selling securities with long
maturities and investing in securities with short maturities when
interest rates are expected to increase or by buying securities with long
maturities and selling securities with short maturities when interest
rates are expected to decline, but might sacrifice some yield by so
doing.
Options on Futures Contracts. The Taxable Fixed Income Funds and the
Tax-Exempt Fixed Income Funds may also purchase put options and write
call options on futures contracts that are traded on a United States
exchange or board of trade and enter into closing transactions with
respect to such options to terminate an existing position. The Funds may
use their options on futures contracts in connection with hedging
strategies. Generally, these strategies would be employed under the same
market and market sector conditions in which the Funds use put and call
options on debt securities. See "Options" below. The purchase of put
options on futures contracts is analogous to the purchase of puts on debt
securities so as to hedge a Fund's portfolio of debt securities against
the risk of rising interest rates.
The writing of a call option on a futures contract constitutes a partial
hedge against declining prices of the debt securities that are
deliverable upon exercise of the futures contract. If the futures price
at expiration is below the exercise price, the Funds will retain the full
amount of the option premium, which provides a partial hedge against any
decline that may have occurred in the Funds' holdings of debt securities.
Risks Associated with Futures Contracts. There are risks associated with
the use of futures contracts for hedging purposes. The price of a futures
contract will vary from day to day and should parallel (but not
necessarily equal) the changes in price of the underlying deliverable
securities. The difference between these two price movements is called
"basis". There are occasions when basis becomes distorted. For instance,
in a rising interest rate environment, the increase in value of the
hedging instruments may not completely offset the decline in value of the
securities in the portfolio. Conversely, when interest rates decline, the
loss in the hedged position may be greater than the capital appreciation
that a Fund experiences in its securities positions. Distortions in basis
are more likely to occur when the securities hedged are not the security
subject to the futures contract or part of the index covered by the
futures contract. Further, if market values do not fluctuate, a Fund will
sustain a loss at least equal to the commissions on the financial futures
transactions.
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All investors in the futures market are subject to initial margin and
variation margin requirements. Rather than providing additional variation
margin, an investor may close out a futures position. Changes in the
initial and variation margin requirements may influence an investor's
decision to close out the position. The normal relationship between the
securities and futures markets may become distorted if changing margin
requirements do not reflect changes in value of the securities. The
liquidity of the futures market depends on participants entering into
offsetting transactions rather than making or taking delivery of the
underlying securities. In the event investors decide to make or take
delivery (which is unlikely), liquidity in the futures market could be
reduced, thus producing temporary basis distortion. Finally, the margin
requirements in the futures market are substantially lower than margin
requirements in the securities market. Therefore, increased participation
by speculators in the futures market may cause temporary basis
distortion.
In the futures market, it may not always be possible to execute a buy or
sell order at the desired price, or to close out an open position due to
market conditions, limits on open positions, and/or daily price
fluctuation limits. Each market establishes a limit on the amount by
which the daily market price of a futures contract may fluctuate. Once
the market price of a futures contract reaches its daily price
fluctuation limit, positions in the commodity can be neither taken nor
liquidated unless traders are willing to effect trades at or within the
limit. The holder of a futures contract (including a Fund) may therefore
be locked into its position by an adverse price movement for several days
or more, which may be to its detriment. If a Fund could not close its
open position during this period it would continue to be required to make
daily cash payments of variation margin. The risk of loss to a Fund is
theoretically unlimited when the Fund writes (sells) an uncovered futures
contract because the Fund is obligated to make delivery unless the
contract is closed out, regardless of fluctuations in the price of the
underlying security. When a Fund purchases a put option or call option,
however, the maximum risk of loss to the Fund is the price of the put
option or call option purchased. See "Options".
Options. In connection with their hedging activities, the Taxable Fixed
Income Funds and the Tax-Exempt Fixed Income Funds may purchase put
options or write (sell) call options on financial futures and debt
securities.
The Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds may
purchase put options as a defensive measure to minimize the impact of
market price declines on the value of certain of the securities in each
Fund's portfolio. Each Taxable Fixed Income Fund or Tax-Exempt Fixed
Income Fund may, in addition, write call options only to the extent
necessary to neutralize a Fund's position in portfolio securities, i.e.,
balance changes in the market value of the portfolio securities and the
changes in the market value of the call options. The Taxable Fixed Income
Funds or the Tax-Exempt Fixed Income Funds may also purchase call options
and sell put options to close out open positions.
The premium that a Fund receives from writing a call option will reflect,
among other things, the current market price of the underlying security,
the relationship of the exercise price to such market price, the
historical price volatility of the underlying security, the option
period, supply and demand, and interest rates.
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<PAGE>
A put option gives the purchaser of the option the right to sell, and the
writer of the option the obligation to buy, the underlying security at
the exercise price at any time during the option period. The Taxable
Fixed Income Funds or the Tax-Exempt Fixed Income Funds will only
purchase put options on securities that, in the opinion of the Adviser,
have investment characteristics similar to those of securities in each
Fund's portfolio. The purchase of a put option would be intended to
protect a Fund from the risk of a decline in the value of a security
below the exercise price of the option. A Fund may ultimately sell the
option in a closing sale transaction, exercise it or permit it to expire.
Profit or loss from such a transaction will depend on whether the sale
price is more or less than the premium paid to purchase the put option
plus the related transaction costs.
A call option gives the purchaser of the option the right to buy, and the
writer of the option the obligation to sell, the underlying security at
the exercise price at any time during the option period, regardless of
the market price of the security. The premium paid to the writer is the
consideration for undertaking the obligations under the option contract.
When a call option is written by any of the Taxable Fixed Income Funds or
the Tax Exempt Fixed Income Funds, the Fund will make arrangements with
its custodian to segregate the related portfolio securities until either
the option is exercised or the Fund closes out the option as described
below. A call option sold by a Fund exposes the Fund during the term of
the option to possible loss of opportunity to realize appreciation in the
market price of the related portfolio security or to possible continued
holding of a security which might otherwise have been sold to protect
against depreciation in the market price of the security.
The Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds will
purchase call options to close out open positions. In order to close out
a position, the Taxable Fixed Income Funds and the Tax-Exempt Fixed
Income Funds may make a "closing purchase transaction" -- the purchase of
a call option on the same security with the same exercise price and
expiration date as the option which it has previously written on a
particular security. The Taxable Fixed Income Funds and the Tax-Exempt
Fixed Income Funds may effect a closing purchase transaction to realize a
profit (or loss) if the amount paid to purchase a call option is less (or
more) than the amount received from the sale thereof, to prevent an
underlying security from being called or, in the case of a call option,
to permit the sale of the underlying security prior to the expiration
date of the option. Furthermore, effecting a closing purchase transaction
in the case of a call option will permit a Fund to write another call
option with either a different exercise price or expiration date or both.
If a Fund desires to sell a particular security from its portfolio on
which it has written a call option, it will effect a closing purchase
transaction prior to or concurrently with the sale of the security.
Because increases in the market price of a call option will generally
reflect increases in the market price of an underlying security, any loss
resulting from the repurchase of a call option is likely to be offset in
whole or in part by unrealized appreciation of the underlying security
owned by a Fund. From time to time, the Taxable Fixed Income Funds and
the Tax-Exempt Fixed Income Funds may purchase an underlying security in
the cash market for delivery in
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<PAGE>
accordance with an exercise notice of a call option assigned to it, rather
than delivering such security from its portfolio, in which case additional
transaction costs will be incurred.
Options written by the Taxable Fixed Income Funds and the Tax-Exempt
Fixed Income Funds will normally have expiration dates between three and
nine months from the date written. The exercise price of the options may
be below ("in-the-money"), equal to ("at-the-money") or above
("out-of-the-money") the current market values of the underlying
securities at the time the options are written. The Taxable Fixed Income
Funds and the Tax-Exempt Fixed Income Funds may engage in buy-and-write
transactions in which a Fund simultaneously purchases a security and
writes a call option thereon. Where a call option is written against a
security subsequent to the purchase of that security, the resulting
combined position is also referred to as a buy-and-write. A buy-and-write
transaction using an in-the-money call option may be utilized when it is
expected that the price of the underlying security will remain flat or
decline moderately during the option period. In such a transaction, a
Fund's maximum gain will be the premium received from writing the option
reduced by any excess of the price paid by the Fund for the underlying
security over the exercise price. Buy-and-write transactions using
at-the-money call options may be utilized when it is expected that the
price of the underlying security will remain at or advance moderately
during the option period. In such a transaction, a Fund's gain will be
equal to the premium received from writing the option. Buy-and-write
transactions using out-of-the-money call options may be utilized when it
is expected that the premiums received from writing the call option plus
the appreciation in the market price of the underlying security up to the
exercise price will be greater than the appreciation in the price of the
underlying security alone. In any of the foregoing situations, if the
market price of the underlying security declines, the Funds may or may
not realize a loss, depending on the extent to which such decline is
offset by the premium received.
The Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds may
purchase put options to protect holdings in an underlying security
against a substantial decline in market value. Such hedge protection is
provided only during the life of the put option when a Fund as the holder
of the put option is able to sell the underlying security at the put
exercise price regardless of any decline in the underlying security's
market price. By using put options in this manner, a Fund will reduce any
profit it might otherwise have realized in its underlying security by the
premium paid for the put option and by transaction costs.
The Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds may
also create the effect of a futures contract position by simultaneous
purchase of a put and sale of a call option on the same security. For
example, the simultaneous purchase of a put option and the sale of a call
option at the same price and for the same exercise dates provide the
Funds with the same hedged position as is created by the sale of a
futures contract. By varying the price of the options the Funds are
exposed to price changes within the range of the different option prices.
The Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds will
not invest more than 5% of their respective net assets in premiums on put
options. See "Portfolio Transactions and Brokerage".
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<PAGE>
Index Transactions. The Taxable Fixed Income Funds and the Tax-Exempt Fixed
Income Funds may utilize futures contracts on bond indexes (municipal bond
indexes in the case of the Tax-Exempt Fixed Income Funds), or related put and
call options on such index contracts, so long as there is an active trading
market for the contracts. These contracts would be utilized as a hedge against
changes in the market value of securities in a Fund's portfolio. Each Fund's
strategy in employing such contracts would be similar to the strategies
discussed above regarding transactions in futures and options contracts
generally.
A bond index or municipal bond index assigns relative values to the bonds
included in the index. The index fluctuates with changes in the market
values of those securities included. For example, the municipal bond
index traded on the Chicago Board of Trade is The Bond Buyer Index, which
includes forty tax-exempt long-term revenue and general obligation bonds.
An index futures contract is an agreement pursuant to which two parties
agree to take or make delivery of an amount of cash equal to a specified
dollar amount times the difference between the index value at the close
of the last trading day of the contract and the price at which the index
contract was originally written. Thus, the index contract is similar to
traditional futures contracts except that settlement is made in cash.
Initial and variation margins are payable by the holders of both long and
short positions in the index future. No physical delivery of the
underlying bonds in the index is made.
The Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds may
also buy put options and sell call options on applicable bond, or
municipal bond, index futures or on applicable bond, or municipal bond
indexes. Options on index futures are similar to options on debt
instruments except that an option on an index future gives the purchaser
the right, in return for the premium paid, to assume a position in an
index contract rather than to purchase or sell a debt instrument at a
specified exercise price at any time during the period of the option.
Upon exercise of the option, the delivery of the futures position by the
writer of the option to the holder of the option will be accompanied by
delivery of the accumulated balance of the writer's futures margin
account which represents the amount by which the market price of the
index futures contract, at exercise, exceeds, in the case of a call, or
is less than, in the case of a put, the exercise price of the option on
the index future.
Options on indexes are also similar to options on debt instruments,
except that rather than the right to take or make delivery of a debt
instrument at a specified price, an option on an index gives the holder
the right to receive, upon exercise of the option, an amount of cash if
the closing level of the index upon which the option is based is greater
than, in the case of a call, or less than, in the case of a put, the
exercise price of the option. Unlike options on debt instruments, gain or
loss depends on the price movements in the securities included in the
index rather than price movements in individual debt instruments.
Equity Funds
Stock Index Futures, Related Options and Options on Stock Indexes. The
Equity Funds may attempt to reduce the risk of investment in equity
securities by hedging a portion of its
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portfolio securities through the use of stock index futures, options on stock
index futures traded on a national securities exchange or board of trade and
options on securities and on stock indexes traded on national securities
exchanges. The Equity Funds' policies with respect to hedging activities are
discussed at length in the Prospectus for the Equity Funds.
A stock index assigns relative weightings to the common stocks in the
index, and the index generally fluctuates with changes in the market
values of these stocks. A stock index futures contract is an agreement in
which one party agrees to deliver to the other 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. Initial and variation
margins are payable by the holders of positions in the stock index
future. In the case of options on stock index futures, the holder of the
option pays a premium and receives the right, upon exercise of the option
at a specified price during the option period, to assume the option
writer's position in a stock index futures contract. If the option is
exercised by the holder before the last trading day, the option writer
delivers to the option holder cash in an amount equal to the difference
between the option exercise price and the closing level of the relevant
index on the date the option expires. In the case of options on stock
indexes, the holder of the option pays a premium and receives the right,
upon exercise of the option at a specified price during the option
period, to receive cash equal to the dollar amount of the difference
between the closing price of the relevant index and the option exercise
price times a specified multiple, called the "multiplier".
During a market decline or when the Adviser anticipates a decline, the
Equity Funds may hedge a portion of its portfolio by selling stock index
futures contracts, purchasing put options on such contracts or purchasing
put options on stock indexes in order to limit exposure to the decline.
The Equity Funds may ultimately sell a put option in a closing sale
transaction, exercise it or permit it to expire. Profit or loss from such
a transaction will depend on whether the sale price is more or less than
the premium paid to purchase the put option plus the related transaction
costs. This strategy provides an alternative to liquidation of securities
positions and the corresponding costs of such liquidation. Conversely,
during a market advance or when the Adviser anticipates an advance, a
Fund may hedge a portion of its portfolio by purchasing stock index
futures contracts, purchasing call options on such contracts or
purchasing call options on stock indexes. This strategy affords a hedge
against a Fund's not participating in a market advance at a time when it
is not fully invested and serves as a temporary substitute for the
purchase of individual securities which may later be purchased in a more
advantageous manner. A Fund will sell options on stock index futures and
on stock indexes only to close out existing hedge positions.
The Equity Funds will not engage in transactions in stock index futures
contracts or related options for speculation. The Equity Funds will use
these instruments only as a hedge against changes resulting from market
conditions in the values of securities held in a Fund's portfolio or
which it intends to purchase and where the transaction is economically
appropriate to the reduction of risks inherent in the ongoing management
of a Fund. In addition, a Fund will sell stock index futures only if the
amount resulting from the multiplication of the then current level of the
indexes upon which its futures contracts are based and the number of
futures contracts
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which would be outstanding do not exceed one-third of the value of a Fund's
net assets. A Fund also may not purchase or sell stock index futures or
purchase options on futures if, immediately thereafter, the sum of the amount
of margin deposits on a Fund's existing futures positions and premiums paid
for such options would exceed 5% of the market value of a Fund's total assets.
When a Fund purchases stock index futures contracts, it will deposit an amount
of cash and cash equivalents equal to the market value of the futures
contracts in a segregated account with the Fund's custodian.
The Equity Funds' successful use of stock index futures contracts,
options on such contracts and options on indexes depends upon the
Adviser's ability to predict movements in the direction of the market and
is subject to various additional risks. The correlation between movements
in the price of the stock index future and the price of the securities
being hedged is imperfect and the risk from imperfect correlation
increases as the composition of the Fund's portfolio diverges from the
composition of the relevant index. In addition, if the specific Fund
purchases futures to hedge against market advances before it can invest
in common stock in an advantageous manner and the market declines, it
might create a loss on the futures contract. Particularly in the case of
options on stock index futures and on stock indexes, the Fund's ability
to establish and maintain positions will depend on market liquidity.
For a discussion of the risks associated with index futures contracts,
see "Hedging Activities -- Taxable Fixed Income Funds and Tax-Exempt
Fixed Income Funds". See also "Portfolio Transactions and Brokerage".
Options on Securities. The Equity Funds may purchase put options only on
equity securities held in its portfolio and write call options on stocks
only if they are covered, and such call options must remain covered so
long as the relevant Fund is obligated as a writer. The Equity Funds do
not presently intend to purchase put options and write call options on
stocks that are not traded on national securities exchanges or listed on
the Nasdaq National Market(R) ("NASDAQ").
The Equity Funds may, from time to time, write call options on its
portfolio securities. The Equity Funds may write only call options that
are "covered", meaning that the writing Fund either owns the underlying
security or has an absolute and immediate right to acquire that security,
without additional cash consideration (or for additional cash
consideration held in a segregated account by its custodian), upon
conversion or exchange of other securities currently held in its
portfolio. In addition, a Fund will not permit the call to become
uncovered prior to the expiration of the option or termination through a
closing purchase transaction as described below. If a Fund writes a call
option, the purchaser of the option has the right to buy (and the Fund
has the obligation to sell) the underlying security at the exercise price
throughout the term of the option. The amount paid to a Fund by the
purchaser of the option is the "premium". A Fund's obligation to deliver
the underlying security against payment of the exercise price would
terminate either upon expiration of the option or earlier if a Fund were
to effect a "closing purchase transaction" through the purchase of an
equivalent option on an exchange. There can be no assurance that a
closing purchase transaction can be effected. The Equity Funds are not
able to effect closing purchase transactions after they receive notice of
exercise.
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In order to write a call option, a Fund is required to comply with the
rules of The Options Clearing Corporation and the various exchanges with
respect to collateral requirements. A Fund may not purchase call options
on individual stocks except in connection with a closing purchase
transaction. It is possible that the cost of effecting a closing
transaction may be greater than the premium received by a Fund for
writing the option.
The Equity Funds may also purchase listed put options. If a Fund
purchases a put option, it has the option to sell a given security at a
specified price at any time during the term of the option.
Purchasing put options may be used as a portfolio investment strategy
when the investment adviser perceives significant short-term risk but
substantial long-term appreciation for the underlying security. The put
option acts as an insurance policy, as it protects against significant
downward price movement while it allows full participation in any upward
movement. If a Fund is holding a stock that it feels has strong
fundamentals, but for some reason may be weak in the near term, it may
purchase a listed put on such security, thereby giving itself the right
to sell such security at a certain strike price throughout the term of
the option. Consequently, a Fund will exercise the put only if the price
of such security falls below the strike price of the put. The difference
between the put's strike price and the market price of the underlying
security on the date a Fund exercises the put, less transaction costs,
will be the amount by which the Fund will be able to hedge against a
decline in the underlying security. If during the period of the option
the market price for the underlying security remains at or above the
put's strike price, the put will expire worthless, representing a loss of
the price the Fund paid for the put, plus transaction costs. If the price
of the underlying security increases, the profit a Fund realizes on the
sale of the security will be reduced by the premium paid for the put
option less any amount for which the put may be sold.
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INVESTMENT RESTRICTIONS
Fundamental Policies
In addition to its investment objectives, each Fund is subject to certain
investment restrictions that are deemed fundamental policies, i.e.,
policies that cannot be changed without the approval of the holders of a
majority of the outstanding voting securities of the Fund, as defined
under "Additional Information" below. See "Organization" and "Additional
Information". The investment restrictions of each Fund follow.
The Money Market Funds may not:
1. Acquire illiquid securities, including repurchase agreements
with more than seven days to maturity or fixed time deposits
with a duration of over seven calendar days, if as a result
thereof, more than 10% of the market value of a Fund's net
assets would be in investments that are illiquid;
28
<PAGE>
2. Enter into reverse repurchase agreements (although the Money
Fund may enter into reverse repurchase agreements, provided
such agreements do not exceed in the aggregate one-third of the
market value of the Money Fund's total assets, less liabilities
other than obligations created by reverse repurchase
agreements);
3. Borrow money, except from banks for extraordinary or emergency
purposes and then only in amounts not to exceed 20% of the
value of the relevant Fund's total assets, taken at cost, at
the time of such borrowing and except in connection with
permitted reverse repurchase agreements, or mortgage, pledge,
or hypothecate any assets except in connection with any such
borrowing and in amounts not to exceed 20% of the value of the
Fund's total assets at the time of such borrowing. Neither Fund
will purchase securities while borrowings (including reverse
repurchase agreements) exceed 5% of its total assets. This
borrowing provision is included to facilitate the orderly sale
of portfolio securities, for example, in the event of
abnormally heavy redemption requests, and is not for investment
purposes and, in the case of the Money Fund, will not apply to
reverse repurchase agreements;
4. Purchase the securities or other obligations of any issuer if,
immediately after such purchase, more than 5% of the value of
the relevant Fund's total assets would be invested in
securities or other obligations of any one such issuer. This
limitation does not apply to issues of the United States
Government, its agencies or instrumentalities or to permitted
investments of up to 25% of a Fund's total assets;
5. Purchase the securities or other obligations of issuers in the
same industry if, immediately after such purchase, the value of
its investment in such industry would exceed 25% of the value
of the relevant Fund's total assets, except that the Fund may
invest more than 25% of its assets in securities and other
instruments issued by banks and bank holding companies. For
purposes of industry concentration, there is no percentage
limitation with respect to investments in securities issued or
guaranteed by the United States Government, its agencies or
instrumentalities, negotiable certificates of deposit, time
deposits, and bankers' acceptances of United States branches of
United States banks;
6. Make loans, except through purchasing or holding debt
obligations, or entering into repurchase agreements, or loans
of portfolio securities in accordance with the relevant Fund's
investment objective and policies (see "Investment Objectives
and Policies");
7. Purchase or sell puts, calls, straddles, spreads or any
combination thereof; real estate; commodities; or commodity
contracts or interests in oil, gas, or
29
<PAGE>
mineral exploration, development or lease programs. However,
the Money Fund may purchase bonds or commercial paper issued by
companies which invest in real estate or interest therein
including real estate investment trusts;
8. Purchase securities on margin, make short sales of securities
or maintain a short position, provided that this restriction
shall not be deemed to be applicable to the purchase or sale of
when-issued securities or of securities for delivery at a
future date;
9. Acquire securities of other investment companies, except as
permitted by the 1940 Act or the rules thereunder;
10. Act as an underwriter of securities; or
11. Issue senior securities as defined in the 1940 Act, except
insofar as a Fund may be deemed to have issued a senior
security by reason of (a) entering into any repurchase
agreement or reverse repurchase agreement; (b) permitted
borrowings of money; or (c) purchasing securities on a
when-issued or delayed delivery basis.
In addition to the restrictions listed above, the Treasury Money Fund may
not:
1. Invest in structured notes or other instruments commonly known
as derivatives;
2. Invest in any type of variable, adjustable or floating rate
securities;
3. Invest in securities issued by agencies or instrumentalities of
the United States Government, such as the Federal National
Mortgage Association, Government National Mortgage Association,
Federal Home Loan Mortgage Corp. or the Small Business
Administration; or,
4. Invest in zero coupon bonds, except that the Treasury Money
Fund may invest in zero coupon bonds issued by the United
States Government provided that the bonds mature within 397
days from the date of purchase, and that the Treasury Money
Fund may include zero coupon bonds issued by the United States
Government as collateral for repurchase agreements.
The Equity Funds may not:
1. Acquire illiquid securities, including repurchase agreements
with more than seven days to maturity or fixed time deposits
with a duration of over seven calendar days, if as a result
thereof, more than 15% of the market value of a Fund's net
assets would be in investments that are illiquid;
30
<PAGE>
2. Borrow money, except from banks for extraordinary or emergency
purposes and then only in amounts not to exceed 20% of the
value of the relevant Fund's total assets, taken at cost, at
the time of such borrowing and except in connection with
reverse repurchase agreements permitted by Investment
Restriction 12, or mortgage, pledge, or hypothecate any assets
except in connection with any such borrowing in amounts not to
exceed 20% of the value of the Fund's net assets at the time of
such borrowing. A Fund will not purchase securities while
borrowings exceed 5% of the Fund's total assets. This borrowing
provision is included to facilitate the orderly sale of
portfolio securities, for example, in the event of abnormally
heavy redemption requests, and is not for investment purposes.
Collateral arrangements for premium and margin payments in
connection with a Fund's hedging activities are not deemed to
be a pledge of assets;
3. Purchase the securities or other obligations of any one issuer
if, immediately after such purchase, more than 5% of the value
of the relevant Fund's total assets would be invested in
securities or other obligations of any one such issuer. This
limitation shall not apply to issues of the United States
Government, its agencies or instrumentalities and to permitted
investments of up to 25% of a Fund's total assets;
4. Purchase the securities or other obligations of issuers in the
same industry if, immediately after such purchase, the value of
its investments in such industry would exceed 25% of the value
of a Fund's total assets. For purposes of industry
concentration, there is no percentage limitation with respect
to investments in securities of the United States Government,
its agencies or instrumentalities;
5. Purchase the securities of an issuer if, immediately after such
purchase, the relevant Fund owns more than 10% of the
outstanding voting securities of such issuer;
6. Make loans, except through the purchase or holding of debt
obligations (including privately placed securities), or the
entering into of repurchase agreements, or loans of portfolio
securities in accordance with a Fund's investment objectives
and policies (see "Investment Objectives and Policies");
7. Purchase or sell puts, calls, straddles, spreads or any
combination thereof; real estate; commodities or commodity
contracts, except for a Fund's interests in hedging activities
as described under "Investment Objectives and Policies"; or
interests in oil, gas or mineral exploration or development
programs. However, a Fund may purchase securities or commercial
paper issued by companies which invest in real estate or
interests therein, including real estate investment trusts;
31
<PAGE>
8. Purchase securities on margin, make short sales of securities,
or maintain a short position, except in the course of a Fund's
hedging activities, provided that this restriction shall not be
deemed to be applicable to the purchase or sale of when-issued
securities or delayed delivery securities;
9. Invest in fixed time deposits with a duration of from two
Business Days to seven calendar days if more than 10% of the
Fund's total assets would be invested in such deposits;
10. Acquire securities of other investment companies, except as
permitted by the 1940 Act or the rules thereunder;
11. Act as an underwriter of securities; or
12. Issue any senior security, except as appropriate to evidence
indebtedness which constitutes a senior security and which a
Fund is permitted to incur pursuant to Investment Restriction 2
and except that the Fund may enter into reverse repurchase
agreements, provided that the aggregate of senior securities,
including reverse repurchase agreements, shall not exceed
one-third of the market value of its total assets, less
liabilities other than obligations created by reverse
repurchase agreements. A Fund's arrangements in connection with
its hedging activities as described in "Investment Objectives
and Policies" shall not be considered senior securities for
purposes hereof.
The Taxable Fixed Income Funds may not:
1. Acquire illiquid securities, including repurchase agreements
with more than seven days to maturity or fixed time deposits
with a duration of over seven calendar days, if as a result
thereof, more than 15% of the market value of the relevant
Fund's net assets would be in investments that are illiquid;
2. Borrow money, except from banks for extraordinary or emergency
purposes and then only in amounts up to 20% of the value of the
relevant Fund's total assets, taken at cost at the time of such
borrowing and except in connection with reverse repurchase
agreements permitted by Investment Restriction 10, or mortgage,
pledge, or hypothecate any assets, except in connection with
any such borrowing in amounts up to 20% of the value of the
Fund's net assets at the time of such borrowing. A Fund will
not purchase securities while borrowings (including reverse
repurchase agreements) exceed 5% of its total assets. This
borrowing provision facilitates the orderly sale of portfolio
securities, for example, in the event of abnormally heavy
redemption requests. This provision is not for investment
purposes. Collateral arrangements for premium and margin
payments in connection with a Fund's hedging activities are not
deemed to be a pledge of assets;
32
<PAGE>
3. Purchase the securities or other obligations of any one issuer
if, immediately after such purchase, more than 5% of the value
of the relevant Fund's total assets would be invested in
securities or other obligations of any one such issuer. This
limitation shall not apply to securities issued or guaranteed
by the United States Government, its agencies or
instrumentalities and to permitted investments of up to 25% of
a Fund's total assets;
4. Purchase the securities of an issuer if, immediately after such
purchase, the relevant Fund owns more than 10% of the
outstanding voting securities of such issuer. This limitation
shall not apply to permitted investments of up to 25% of a
Fund's total assets;
5. Purchase the securities or other obligations of issuers in the
same industry if, immediately after such purchase, the value of
its investment in such industry would exceed 25% of the value
of a Fund's total assets, except that a Fund will invest more
than 25% of its assets in securities issued or guaranteed by
the United States Government, its agencies or
instrumentalities;
6. Make loans, except through the purchase or holding of debt
obligations (including privately placed securities) or the
entering into of repurchase agreements, or loans of portfolio
securities in accordance with the relevant Fund's investment
objective and policies;
7. Purchase or sell puts, calls, straddles, spreads or any
combination thereof; real estate; commodities; commodity
contracts, except for a Fund's interest in hedging activities
as described under "Investment Objectives and Policies"; or
interest in oil, gas, or mineral exploration or development
programs. However, a Fund may purchase debt obligations secured
by interests in real estate or issued by companies which invest
in real estate or interests therein including real estate
investment trusts;
8. Purchase securities on margin, make short sales of securities
or maintain a short position, except in the course of the
relevant Fund's hedging activities, unless at all times when a
short position is open the Fund owns an equal amount of such
securities or securities convertible into such securities or
maintains in a segregated account liquid short-term securities
with a market value at all times equal to or greater than the
relevant Fund's purchase obligation or short position; provided
that this restriction shall not be deemed to be applicable to
the purchase or sale of when-issued or delayed delivery
securities;
9. Invest in fixed time deposits with a duration of from two
Business Days to seven calendar days if more than 10% of a
Fund's total assets would be invested in such deposits;
33
<PAGE>
10. Issue any senior security, except as appropriate to evidence
indebtedness which constitutes a senior security and which a
Fund is permitted to incur pursuant to Investment Restriction 2
and except that a Fund may enter into reverse repurchase
agreements, provided that the aggregate of senior securities,
including reverse repurchase agreements, shall not exceed
one-third of the market value of the Fund's total assets, less
liabilities other than obligations created by reverse
repurchase agreements. A Fund's arrangements in connection with
its hedging activities as described in "Investment Objectives
and Policies" shall not be considered senior securities for
purposes hereof;
11. Acquire securities of other investment companies, except as
permitted by the 1940 Act or the rules thereunder; or
12. Act as an underwriter of securities.
The Tax-Exempt Fixed Income Funds may not:
1. Acquire illiquid securities, including repurchase agreements
with more than seven days to maturity or fixed time deposits
with a duration of over seven calendar days, if as a result
thereof, more than 15% of the market value of the relevant
Fund's net assets would be in investments that are illiquid;
2 Borrow money, except from banks for extraordinary or emergency
purposes and then only in amounts up to 20% of the value of the
relevant Fund's total assets, taken at cost at the time of such
borrowing and except in connection with reverse repurchase
agreements permitted by Investment Restriction 10, or mortgage,
pledge, or hypothecate any assets except in connection with any
such borrowing in amounts up to 20% of the value of the Fund's
net assets at the time of such borrowing. A Fund will not
purchase securities while borrowings (including reverse
repurchase agreements) exceed 5% of the Fund's total assets.
This borrowing provision facilitates the orderly sale of
portfolio securities, for example, in the event of abnormally
heavy redemption requests. This provision is not for investment
purposes. Collateral arrangements for premium and margin
payments in connection with a Fund's hedging activities are not
deemed to be a pledge of assets;
3. Purchase securities or other obligations of any one issuer if,
immediately after such purchase, more than 5% of the value of
the relevant Fund's total assets would be invested in
securities or other obligations of any one such issuer. Each
state and political subdivision, agency or instrumentality of
such state and each multi-state agency of which such state is a
member will be a separate issuer if the security is backed only
by the assets and revenue of that issuer. If the security is
guaranteed by another entity, the guarantor will be deemed to
be the issuer. This limitation shall not apply to securities
issued or guaranteed
34
<PAGE>
by the United States Government, its agencies or
instrumentalities or to permitted investments of up to 50% of a
Fund's total assets;
4. Purchase the securities or other obligations of issuers in the
same industry if, immediately after such purchase, the value of
the relevant Fund's investment in such industry would exceed
25% of the value its total assets, except that a Fund will
invest more than 25% of its assets in securities issued or
guaranteed by the United States Government, (and, in the case
of the Intermediate New York Tax-Exempt Fund, New York State,
New York City and the Commonwealth of Puerto Rico) and their
respective authorities, agencies, instrumentalities and
political subdivisions;
5. Purchase industrial revenue bonds if, as a result of such
purchase, more than 5% of the relevant Fund's total assets
would be invested in industrial revenue bonds where payment of
principal and interest are the responsibility of companies with
fewer than three years of operating history (including
predecessors);
6. Make loans, except through the purchase or holding of debt
obligations (including privately placed securities) or the
entering into of repurchase agreements, or loans of portfolio
securities in accordance with the relevant Fund's investment
objective and policies (see "Investment Objectives and
Policies");
7. Purchase or sell puts, calls, straddles, spreads or any
combination thereof except to the extent that securities
subject to a demand obligation, stand-by commitments and puts
may be purchased (see "Investment Objectives and Policies");
real estate; commodities; commodity contracts, except for a
Fund's interest in hedging activities as described under
"Investment Objectives and Policies"; or interests in oil, gas,
or mineral exploration or development programs. However, a Fund
may purchase municipal bonds, notes or commercial paper secured
by interest in real estate;
8. Purchase securities on margin, make short sales of securities
or maintain a short position, except in the course of the
Fund's hedging activities, unless at all times when a short
position is open the Fund owns an equal amount of such
securities or owns securities which, without payment of any
further consideration, are convertible into or exchangeable for
securities of the same issue as, and equal in amount to, the
securities sold short; provided that this restriction shall not
be deemed to be applicable to the purchase or sale of
when-issued or delayed delivery securities;
9. Invest in fixed time deposits with a duration of from two
Business Days to seven calendar days if more than 5% of the
relevant Fund's total assets would be invested in such
deposits;
35
<PAGE>
10. Issue any senior security, except as appropriate to evidence
indebtedness which constitutes a senior security and which a
Fund is permitted to incur pursuant to Investment Restriction 2
and except that a Fund may enter into reverse repurchase
agreements, provided that the aggregate of senior securities,
including reverse repurchase agreements, shall not exceed
one-third of the market value of the relevant Fund's total
assets, less liabilities other than obligations created by
reverse repurchase agreements. A Fund's arrangements in
connection with its hedging activities as described in
"Investment Objectives and Policies" shall not be considered
senior securities for purposes hereof;
11. Acquire securities of other investment companies, except as
permitted by the 1940 Act or the rules thereunder; or
12. Act as an underwriter of securities.
Undertaking in Response to State Securities Regulations
In order to satisfy the requirements of certain state securities
regulations, the Equity Income Fund has undertaken not to invest more
than 5% of its net assets in warrants and to further restrict its
investment in warrants so that not more than 2% of net assets will be
invested in warrants that are not listed on the New York Stock Exchange
or the American Stock Exchange. This is not, however, a fundamental
policy and may be changed by the Directors at any time without the
approval of the shareholders of the Equity Income Fund.
- ------------------------------------------------------------------------------
DIRECTORS AND OFFICERS
The directors and executive officers of BNY Hamilton Funds, Inc., their
business addresses and their principal occupations during the past five
years are:
36
<PAGE>
<TABLE>
<CAPTION>
Principal Occupations
Name and Address Position with Funds During Past Five Years
- ---------------- ------------------- ----------------------
<S> <C> <C>
Edward L. Gardner Director and Chairman Chairman of the Board, President and
411 Theodore Fremd Ave. of the Board Chief Executive Officer, Industrial
Rye, NY 10580 Solvents Corporation, 1981 to Present;
Age 63 Chairman of the Board, Blue Grass
Chemical Specialties Inc., 1982 to
Present; Chairman of the Board, Big
Brothers/Big Sisters of New York City,
1992 to Present; National
Vice-Chairman, Big Brothers/Big
Sisters of America, 1993 to Present;
President, Big Brothers/Big Sisters of
America Foundation, 1994 to Present;
Vice President of the Board, The
Sherry Netherland Hotel, 1991 to
Present; Member, Points of Light
Foundation, 1995 to Present; Member,
The National Assembly, 1992 to
Present; Member, Alvin Ailey Dance
Theatre Foundation, Inc., 1989 to
Present; Member, The Institute for Art
and Urban Resources, Inc. 1985 to
1994; Member, Mercy College, 1989 to
Present; Member, Westchester/Putnam
Regional Board of Directors, The Bank
of New York, 1982 to Present; Member,
Westchester County Association, 1986
to Present.
Mr. Peter Herrick* Director Trustee, HRE Properties, 1990 to
42 Sunnybrook Road Present; Member, New York State Banking
Bronxville, NY 10708 Board, 1990-1993.
Age 71
Leif H. Olsen Director President, Leif H. Olsen Investments,
49 Locust Avenue Inc., a registered investment adviser;
Suite 301 1987 to Present
New Canaan, CT 06840
Age 72
</TABLE>
37
<PAGE>
<TABLE>
<S> <C> <C>
Mr. Stephen Stamas* Director Chairman, New York Philharmonic, 1989 to
Windcrest Partners Present.
122 E. 42nd Street
49th Floor
New York, NY 10168
Age 67
James E. Quinn Director Member, Board of Directors, Tiffany &
727 Fifth Avenue Co., January 1995 to Present; Executive
New York, NY 10022 Vice President of Sales, Tiffany & Co.,
Age 46 March 1992 to Present.
J. David Huber Chief Executive Officer Employee, BISYS Fund Services, Inc.,
3435 Stelzer Road June 1987 to Present
Columbus, OH 43219
Age 51
William J. Tomko President Vice President, BISYS Fund Services,
3435 Stelzer Road Inc., 1989 to Present
Columbus, OH 43219
Age 39
Mary A. Madick Vice President Employee, BISYS Fund Services, Inc., May
3435 Stelzer Road 1996 to Present; Employee, T. Rowe
Columbus, OH 43219 Price, 1990 to May 1996.
Age 39
Anthony L. Mercure Vice President Director, Client Services, BISYS Fund
3435 Stelzer Road Services, Inc., 1996-Present; Director
Columbus, OH 43219 of Business Development, BISYS Fund
Age 37 Services, Inc., 1994-1996; Director,
Fund Accounting, BISYS Fund Services,
Inc., 1991-1994
</TABLE>
38
<PAGE>
<TABLE>
<S> <C> <C>
Nimish Bhatt Treasurer Vice President, Tax and Financial
3435 Stelzer Road Services, BISYS Fund Services, Inc.,
Columbus, OH 43219 June 1996-Present; Assistant Vice
Age 35 President, Evergreen Funds/First Union
Bank, 1995 to July 1996; Senior Tax
Consultant, Price Waterhouse LLP, 1990
to December 1994.
Ellen Stoutamire Secretary Vice President, Legal Services,
3435 Stelzer Road BISYS Fund Services, Inc., 1995
Columbus, OH 43219 -Present; Attorney, private practice,
Age 49 1990 to 1995.
Alaina V. Metz Assistant Secretary Chief Administrator, Administrative and
3435 Stelzer Road Regulatory Services of BISYS Fund
Columbus, OH 43219 Services, Inc., June 1995 to Present;
Age 30 Supervisor of Mutual Fund Legal
Department, Alliance Capital Management,
May 1989 to June 1995.
- ------------------------------------------------------------------------------------------------------------------
*Interested person
</TABLE>
In 1998, the Directors will be paid an annual fee of $15,000 and an
additional $1,200 for each meeting of the Board of Directors that they
attend, plus out-of-pocket expenses. The Directors are not paid any
pension or retirement benefits. The Directors may hold various other
directorships unrelated to the Funds.
The following chart describes the compensation paid to Directors by BNY
Hamilton Funds, Inc. for the fiscal year ended December 31, 1997:
39
<PAGE>
<TABLE>
<CAPTION>
Pension or
Aggregate Retirement Total
Compensation Benefits Accrued Estimated Annual Compensation Paid
Name of Person, Paid by the as Part of Fund Benefits Upon by the Funds
Position Funds Expenses Retirement to Directors
-------- ----- -------- ---------- ------------
<S> <C> <C> <C> <C>
Edward L. Gardner $14,800 $0 $0 $14,800
--------- -------
Director and Chairman of the
Board
Peter Herrick $14,800 $0 $0 $14,800
--------- -------
Director
Leif H. Olsen $14,800 $0 $0 $14,800
--------- -------
Director
Stephen Stamas $14,800 $0 $0 $14,800
--------- -------
Director
James E. Quinn $14,800 $0 $0 $14,800
--------- -------
Director
</TABLE>
The above compensation, which is expected to total approximately $99,000
plus out-of-pocket costs for 1998, will be allocated to all series of BNY
Hamilton Funds, Inc.
By virtue of the responsibilities assumed by the Adviser and the
Administrator (see "Investment Adviser", "Administrator" and
"Distributor") and the services provided by BNY Hamilton Distributors,
Inc., the Funds have no employees; their officers are provided and
compensated by BNY Hamilton Distributors, Inc. BNY Hamilton Funds, Inc.'s
officers conduct and supervise the business operations of the Funds.
- --------------------------------------------------------------------------------
INVESTMENT ADVISER
The investment adviser to the Funds is The Bank of New York, a bank
organized under the laws of the State of New York with its principal
offices at 48 Wall Street, New York, New York 10286. The Bank of New York
is subject to regulation by the New York State Banking Department and is
a member bank of the Federal Reserve System. Through offices in New York
City and abroad, The Bank of New York offers a wide range of services,
primarily to governmental, institutional, corporate and individual
customers in the United States and throughout the world.
The International Equity Fund is sub-advised by Indocam, a subsidiary of
Banque Indosuez. The Bank of New York will pay Indocam a fee equal to
.425% of the average daily net assets of the International Equity Fund.
Under the terms of the Advisory Agreements, the investment advisory
services The Bank of New York provides to BNY Hamilton Funds, Inc. are
not exclusive. The Bank of New York is free to and does render similar
investment advisory services to others. The Bank of New York serves as
investment adviser to personal investors and acts as fiduciary for
trusts, estates and employee benefit plans. Certain of the assets of
trusts and estates under management are
40
<PAGE>
invested in common trust funds for which The Bank of New York serves as
trustee. The accounts managed or advised by The Bank of New York have varying
investment objectives and The Bank of New York invests assets of such accounts
in investments substantially similar to, or the same as, those that are
expected to constitute the principal investments of the Funds. Such accounts
are supervised by officers and employees of The Bank of New York who may also
be acting in similar capacities for the Funds. See "Portfolio Transactions and
Brokerage".
The Bank of New York has voluntarily agreed to limit the expenses of the
Funds listed in the chart below. The limitation will be accomplished by
waiving all or a portion of its advisory, accounting, custodial and
certain other service fees and, if necessary, reimbursing expenses. This
voluntary limitation of expenses may be modified or terminated at any
time. There were no waivers or reimbursements of expenses with respect to
the Equity Income Fund and the Money Fund as of December 31, 1997.
<TABLE>
<CAPTION>
HAMILTON HAMILTON PREMIER
SHARES SHARES
--------------------- -----------------------------
<S> <C> <C>
Treasury Money Fund.................................. .25% .50%
---- -----
INSTITUTIONAL INVESTOR
SHARES SHARES
--------------------- -----------------------------
Large Cap Growth Fund................................ .82% 1.07%
---- -----
Small Cap Growth Fund................................ .97% 1.22%
---- -----
International Equity Fund............................ 1.27% 1.52%
---- -----
Intermediate Government Fund......................... .90% 1.15%
---- -----
Intermediate Investment Grade Fund................... .90% 1.15%
---- -----
Intermediate New York Tax-Exempt Fund................ .90% 1.15%
---- -----
Intermediate Tax-Exempt Fund......................... .90% 1.15%
---- -----
</TABLE>
For the fiscal years ended December 31, 1995, 1996, and 1997, The Bank of
New York received advisory fees from the Funds as follows:
<TABLE>
<CAPTION>
1995 1996 1997
------ ---- ---
<S> <C> <C> <C>
Money Fund $677,979 $1,128,699 $1,364,166
----------
Treasury Money Fund N/A N/A $28,637
- ------------------- --- --- ----------
Intermediate Government Fund $308,254 $321,787 $290,842
-------- ----------
Intermediate Investment Grade Fund N/A N/A $1,326,324
- ---------------------------------- --- --- ----------
Intermediate New York Tax-Exempt Fund $195,647 $193,702 $117,747
-------- ----------
Intermediate Tax-Exempt Fund N/A N/A $1,013,662
- ---------------------------- --- --- ----------
Equity Income Fund $936,192 $1,211,813 $2,765,841
----------
Large Cap Growth Fund N/A N/A $1,419,944
- --------------------- --- --- ----------
Small Cap Growth Fund N/A N/A $547,464
- --------------------- --- --- ----------
International Equity Fund N/A N/A $329,170
- ------------------------- --- --- ----------
</TABLE>
41
<PAGE>
The above chart reflects advisory fee waivers by The Bank of New York as
follows:
<TABLE>
<CAPTION>
1995 1996 1997
---- ---- ----
<S> <C> <C> <C>
Money Fund $0 $0 $0
-- --
Treasury Money Fund N/A N/A $61,996
- ------------------- --- --- -------
Intermediate Government Fund $0 $0 $47,715
-- -- -------
Intermediate Investment Grade Fund N/A N/A $0
- ---------------------------------- --- ---
Intermediate New York Tax-Exempt Fund $20,367 $0 $75,480
-- -------
Intermediate Tax-Exempt Fund N/A N/A $0
- ---------------------------- --- ---
Equity Income Fund $0 $0 $0
-- --
Large Cap Growth Fund N/A N/A $177,856
- --------------------- --- --- --------
Small Cap Growth Fund N/A N/A $116,936
- --------------------- --- --- --------
International Equity Fund N/A N/A $116,797
- ------------------------- --- --- --------
</TABLE>
The Advisory Agreement for each Fund must be specifically approved at
least annually (i) by a vote of the holders of a majority of the Fund's
outstanding shares or by its Directors and (ii) by a vote of a majority
of the Directors of the Fund who are not "interested persons" as defined
by the 1940 Act cast in person at a meeting called for the purpose of
voting on such approval. See "Directors and Officers". Each of the
Advisory Agreements will terminate automatically if assigned and is
terminable at any time without penalty by a vote of a majority of the
Directors or by a vote of the holders of a majority of a Fund's
outstanding shares on 60 days' written notice to the Adviser and by the
Adviser on 90 days' written notice to BNY Hamilton Funds, Inc. See
"Additional Information".
The Bank Holding Company Act of 1956 and the Glass-Steagall Act, as
interpreted by the Board of Governors of the Federal Reserve System,
generally prohibit The Bank of New York Company, Inc. and its
subsidiaries, including The Bank of New York, from sponsoring, organizing
or controlling a registered open-end investment company continuously
engaged in the issuance of its shares, such as the Corporation. This
prohibition does not extend to providing investment advice, custodial and
certain other services. The Bank of New York believes that it may perform
the services for the Funds contemplated by the Advisory Agreement without
violating the Glass-Steagall Act or other applicable banking laws or
regulations. It is, however, possible that future changes in either
federal or state statutes and regulations concerning the permissible
activities of banks or trust companies, as well as further judicial or
administrative decisions and interpretations of present and future
statutes and regulations, might prevent The Bank of New York from
continuing to perform such services for the Funds.
If The Bank of New York were prohibited from acting as investment adviser
to the Funds, it is expected that the Directors would recommend to the
Funds' shareholders that they approve the Funds' entering into new
investment advisory agreements with another qualified adviser selected by
the Directors.
42
<PAGE>
- ------------------------------------------------------------------------------
ADMINISTRATOR
BNY Hamilton Distributors, Inc. serves as the Fund's administrator (the
"Administrator") and will assist generally in supervising the operations
of the Funds. The Administrator is a Delaware corporation organized to
administer and distribute mutual funds; its offices are located at 125
West 55th Street, New York New York 10019.
The Administrator has agreed to provide facilities, equipment and
personnel to carry out administrative services for the Fund, including,
among other things, providing the services of persons who may be
appointed as officers and directors of BNY Hamilton Funds, Inc.,
overseeing the performance of the transfer agent for each Fund,
supervising purchase and redemption orders (made via telephone and mail)
and monitoring the Distributor's compliance with the National Association
of Securities Dealers, federal and state securities laws. The
Administrator will also be responsible for coordinating and overseeing
compliance by the Directors with Maryland corporate procedural
requirements as the Funds are series of a Maryland corporation. See
"Description of Shares". The Administrator is also responsible for
updating and printing the Funds' prospectuses and statements of
additional information, administering shareholder meetings, producing
proxy statements and annual and semi-annual reports, monitoring the
Adviser's compliance with the stated investment objectives and
restrictions of each Fund and ensuring that custodian, Fund accounting,
transfer agency, administration, distribution, advisory and legal
services are provided to the Funds in accordance with the respective
agreements governing each relationship.
The Administration Agreement permits the Administrator to delegate
certain of its responsibilities to other service providers. Pursuant to
this authority, The Bank of New York will perform certain administrative
functions for the Administrator. The Bank of New York is not an otherwise
affiliated person of the Administrator.
The Money Market Funds will pay the Administrator an annual fee, accrued
daily and payable monthly, of .10% of their respective average daily net
assets. All other Funds will each pay the Administrator an annual fee,
accrued daily and payable monthly, of .20% of their respective average
daily net assets .
For the fiscal years ended December 31, 1995, 1996, and 1997, the Funds
paid administration fees as follows:
43
<PAGE>
<TABLE>
<CAPTION>
1995 1996 1997
------ ---- ---
<S> <C> <C> <C>
Money Fund $677,980 $1,128,699 $1,364,166
---------
Treasury Money Fund N/A N/A $90,633
- ------------------- --- --- ---------
Intermediate Government Fund $123,301 $128,631 $135,423
-------- ---------
Intermediate Investment Grade Fund N/A N/A $530,532
- ---------------------------------- --- --- ---------
Intermediate New York Tax-Exempt Fund $64,804 $49,111 $64,296
------- ------- ---------
Intermediate Tax-Exempt Fund N/A N/A $405,467
- ---------------------------- --- --- ---------
Equity Income Fund $312,064 $403,939 $871,405
-------- ---------
Large Cap Growth Fund N/A N/A $532,600
- --------------------- --- --- ---------
Small Cap Growth Fund N/A N/A $177,174
- --------------------- --- --- ---------
International Equity Fund N/A N/A $104,935
- ------------------------- --- --- ---------
</TABLE>
The above chart reflects administration fee waivers from the Intermediate
New York Tax-Exempt Fund of $21,601 , $28,176 and $12,990 for the fiscal
years ended December 31, 1995, 1996, and 1997, respectively. There were
no waivers of administration fees from any other Fund during the last
three fiscal years.
The Administration Agreement between BNY Hamilton Funds, Inc. and the
Administrator may be renewed or amended by the Directors without a shareholder
vote.
- --------------------------------------------------------------------------------
DISTRIBUTOR
In addition to acting as the Administrator, BNY Hamilton Distributors,
Inc. acts as each Fund's exclusive Distributor and will hold itself
available to receive purchase orders for Fund shares. The Distribution
Agreements for each Fund must be approved in the same manner as the
Advisory Agreements described above under "Investment Adviser". Each
Distribution Agreement will terminate automatically if assigned by either
party thereto and is terminable at any time without penalty by a vote of
a majority of the Directors or by a vote of the holders of a majority of
a Fund's outstanding shares as defined under "Additional Information".
The Directors have adopted distribution plans ("12b-1 Plans") with
respect to Hamilton Classic Shares of the Money Fund, and the Investor
Shares of each of the Equity Funds, the Taxable Fixed Income Funds, and
the Tax-Exempt Fixed Income Funds, which will permit the respective Funds
to reimburse the Distributor for distribution expenses in an amount up to
.25% per annum of average daily net assets of Hamilton Classic Shares or
Investor Shares, as applicable. These expenses include, but are not
limited to, fees paid to broker-dealers, telemarketing expenses,
advertising costs, printing costs, and the cost of distributing materials
borne by the Distributor in connection with sales or selling efforts on
behalf of Hamilton Classic Shares or Investor Shares, as applicable. The
Hamilton Classic Shares or Investor Shares of each Fund also bear the
costs associated with implementing and operating the related 12b-1 Plan
(such as costs of printing and mailing service agreements). Each item for
which a payment may be made under the 12b-1 Plan may constitute an
expense of distributing Hamilton Classic Shares or Investor Shares of the
related Fund as the Securities and Exchange Commission construes
44
<PAGE>
such term under Rule 12b-1 of the 1940 Act. If expenses reimbursable under the
12b-1 Plan exceed .25% per annum of average daily net assets, they will be
carried forward from month to month to the extent they remain unpaid. All or a
part of any such amount carried forward will be paid at such time, if ever, as
the Directors determine. The Hamilton Classic Shares or Investor Shares of
each Fund will not be charged for interest, carrying or other finance charges
on any reimbursed distribution or other expense incurred and not paid, nor
will any expense be carried forward past the fiscal year in which it is
incurred.
For the fiscal year ended December 31, 1997, the Funds paid the following
amounts for services related to their respective 12b-1 Plans. In each
Fund, approximately 60% of the amount shown represents compensation to
dealers and 40% represents payments to banks.
Money Fund $42,527
---------- -------
Intermediate Government Fund $18,394
---------------------------- -------
Intermediate Investment Grade Fund $1,458
---------------------------------- ------
Intermediate New York Tax-Exempt Fund $19,554
------------------------------------- -------
Intermediate Tax-Exempt Fund $109
---------------------------- ----
Equity Income Fund $61,919
------------------ -------
Large Cap Growth Fund $4,805
--------------------- ------
Small Cap Growth Fund $903
--------------------- ----
International Equity Fund $2,732
------------------------- ------
There is no 12b-1 Plan in effect for the Treasury Money Fund.
Payments for distribution expenses under the 12b-1 Plans are subject to
Rule 12b-1 (the "Rule") under the 1940 Act. Payments under the 12b-1
Plans are also subject to the conditions imposed by Rule 18f-3 under the
1940 Act and a Rule 18f-3 Multiple Class Plan which has been adopted by
the Directors for the benefit of the Funds. The Rule defines distribution
expenses to include the cost of "any activity which is primarily intended
to result in the sales of shares". The Rule provides, among other things,
that a Fund may bear such expenses only pursuant to a plan adopted in
accordance with the Rule. In accordance with the Rule, each 12b-1 Plan
provides that a report of the amounts expensed under the Plan, and the
purposes for which such expenditures were incurred, will be made to the
Directors for their review at least quarterly. Each 12b-1 Plan provides
that it may not be amended to increase materially the costs which the
related Fund may bear for distribution pursuant to the 12b-1 Plan without
shareholder approval, and each 12b-1 Plan provides that any other type of
material amendment must be approved by a majority of the Directors, and
by a majority of the Directors who are neither "interested persons" (as
defined in the 1940 Act) of BNY Hamilton Funds, Inc. nor have any direct
or indirect financial interest in the operation of the 12b-1 Plan being
amended or in any related agreements, by vote cast in person at a meeting
called for the purpose of considering such amendments. In addition, as
long as the 12b-1 Plans are in effect, the nomination of the Directors
who are not interested persons of BNY Hamilton Funds, Inc. (as defined in
the 1940 Act) must be committed to the non-interested Directors.
45
<PAGE>
- --------------------------------------------------------------------------------
FUND, SHAREHOLDER AND OTHER SERVICES
BISYS Fund Services, Inc. ("BISYS"), P.O. Box 163310, Columbus, Ohio,
43216-3310, serves as the transfer agent for the Funds. As transfer
agent, BISYS is responsible for maintaining account records detailing the
ownership of Fund shares and for crediting income, capital gains and
other changes in share ownership to investors' accounts. BISYS is also
the dividend disbursing agent for all Funds.
The Directors, in addition to reviewing actions of the Funds' investment
adviser, administrator and distributor, as set forth below, decide upon
matters of general policy. The Money Fund and Treasury Money Fund have
entered into Shareholder Servicing Agreements with respect to Hamilton
Premier Shares of each Fund and Hamilton Classic Shares of the Money Fund
with The Bank of New York. The Bank of New York (as a "Shareholder
Servicing Agent") will perform certain shareholder support services to
include: (i) aggregating and processing purchase and redemption orders;
(ii) placing purchase and redemption orders with the Distributor; (iii)
providing necessary personnel and facilities to establish and maintain
customer accounts and records; (iv) processing dividend payments; and (v)
providing periodic information to beneficial owners showing their
positions in Hamilton Premier Shares of each Fund. Pursuant to the
Shareholder Servicing Agreement, the Hamilton Premier Shares of each
Money Market Fund and the Hamilton Classic Shares of the Money Fund will
pay The Bank of New York (and any other Shareholder Servicing Agent) an
annual shareholder servicing fee of .25%, to be accrued daily and payable
monthly, of the average net assets of each such class represented by such
Shareholder Servicing Agent's participation in each Fund.
The Bank of New York, 90 Washington Street, New York, New York 10286,
serves as the custodian and fund accounting agent for each Fund.
KPMG Peat Marwick LLP, 345 Park Avenue, New York, New York 10154, are the
independent auditors of the Funds and must be approved at least annually
by the Directors to continue in such capacity. They will perform audit
services for the Funds including the examination of financial statements
included in the annual report to shareholders.
- ------------------------------------------------------------------------------
PURCHASE OF SHARES
Investors may open Fund accounts and purchase shares as described in each
Prospectus under "Purchase of Shares".
Each Fund may accept securities in payment for Fund shares sold at the
applicable public offering price (net asset value) at the discretion of
the Fund, although the Fund would expect to accept securities in payment
for Fund shares only infrequently. Generally, a Fund will only consider
accepting securities (i) to increase its holdings in one or more
portfolio securities or (ii) if the Adviser determines that the offered
securities are a suitable investment for the Fund
46
<PAGE>
and in a sufficient amount for efficient management. Although no minimum has
been established, it is expected that a Fund would not accept securities with
a value of less than $100,000 per issue in payment for shares. A Fund may
reject in whole or in part offers to pay for Fund shares with securities and
may discontinue its practice of accepting securities as payment for Fund
shares at any time without notice. An Equity Fund will not accept restricted
securities in payment for shares. The Fund will value accepted securities in
the manner provided for valuing portfolio securities of the Fund. See "Net
Asset Value--Equity Funds".
- --------------------------------------------------------------------------------
REDEMPTION OF SHARES
Investors may redeem shares as described in each Prospectus under
"Redemption of Shares." Shareholders redeeming shares of either Money
Market Fund should be aware that both Funds attempt to maintain a stable
net asset value of $1.00 per share for each class; however, there can be
no assurance that either Fund will be able to continue to do so and, in
that case, the net asset value of either Fund's shares might deviate from
$1.00 per share. Accordingly, a redemption request might result in
payment of a dollar amount that differs from the number of shares
redeemed. In the case of the other Funds, the principal value fluctuates
so that the proceeds of an investor's shares when redeemed may be more or
less than their original cost. See "Net Asset Value" in the Money Market
Fund Prospectus and below.
Shareholders redeeming their shares by telephone should be aware that
neither of the Funds nor any of their service contractors will be liable
for any loss or expense for acting upon any telephone instructions that
are reasonably believed to be genuine. In attempting to confirm that
telephone instructions are genuine, the Funds will use such procedures as
are considered reasonable, including recording those instructions and
requesting information as to account registration (such as the name in
which an account is registered, the account number, recent transactions
in the account, and the account holder's social security or taxpayer's
identification number, address and/or bank). To the extent the Funds fail
to use reasonable procedures as a basis for its belief, it and/or its
service contractors may be liable for instructions that prove to be
fraudulent or unauthorized.
If a Fund determines that it would be detrimental to the best interests
of the remaining shareholders of the Fund to make payment wholly or
partly in cash, the Fund may pay the redemption price, in lieu of cash,
in whole or in part by a distribution in kind of securities from the
portfolio of the Fund in conformity with the applicable rule of the
Securities and Exchange Commission. If shares are redeemed in kind, the
redeeming shareholder might incur transaction costs in converting the
assets into cash. The method of valuing portfolio securities is described
under "Net Asset Value", and such valuation will be made as of the same
time the redemption price is determined.
Further Redemption Information. The Funds reserve the right to suspend
the right of redemption and to postpone the date of payment upon
redemption as follows: (i) during periods
47
<PAGE>
when the New York Stock Exchange is closed for other than weekends and
holidays or when trading on such Exchange is restricted, (ii) during periods
in which an emergency exists that causes disposal of, or evaluation of the net
asset value of, the portfolio securities to be not reasonably practicable or
(iii) for such other periods as the Securities and Exchange Commission may
permit.
- --------------------------------------------------------------------------------
EXCHANGE OF SHARES
Shareholders purchasing shares directly from the Funds may exchange those
shares at the current net asset value per share for other BNY Hamilton
Funds which have a similar class of shares, in accordance with the terms
of the current prospectus of the Fund being acquired. Requests for
exchange are made in the same manner as requests for redemptions. See
"Redemption of Shares". Shares of the Fund to be acquired are purchased
for settlement when the proceeds from redemption become available. In the
case of investors in certain states, state securities laws may restrict
the availability of the exchange privilege.
- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS
Each Fund declares and pays dividends and distributions as described
under "Dividends and Distributions" in such Fund's Prospectus.
Net investment income of each class of shares in the Money Fund and the
Treasury Money Fund consists of accrued interest or discount and
amortized premium applicable to the specific class, less the accrued
expenses of the relevant Fund applicable to the specific class during
that dividend period, including the fees payable to the Administrator,
allocated to each class of shares. See "Net Asset Value". Determination
of the net investment income for each class of shares for each Money
Market Fund will be made immediately prior to the determination of net
asset value at 4:30 P.M., Eastern time, on each Business Day.
Dividends on each Hamilton Share and Hamilton Premier Share of the Money
Fund and the Treasury Money Fund and Hamilton Classic Share of the Money
Fund are determined in the same manner and are paid in the same amount
regardless of class, except that Hamilton Premier Shares and Hamilton
Classic Shares bear the fees paid to Shareholder Organizations on their
behalf for those general services described under "Fund and Other
Shareholder Services--Shareholder Servicing Plan" in the Prospectus for
the Money Market Funds, and Hamilton Classic Shares bear 12b-1 fees. In
addition, each class of shares of the Money Fund and the Treasury Money
Fund bears certain other miscellaneous expenses specific to that class
(i.e., certain cash management, registration and transfer agency
expenses).
Determination of the net investment income for the Taxable Fixed Income
Funds and the Tax-Exempt Fixed Income Funds will be made immediately
prior to the determination of net asset value at 4:00 P.M., Eastern time,
on each Business Day. Net investment income for days other
48
<PAGE>
than Business Days is determined as of 4:00 P.M., Eastern time, on the
preceding Business Day. See "Purchase of Shares" in the relevant Prospectus
and this Statement of Additional Information. Shares redeemed earn a dividend
on the Business Day that the redemption becomes effective. See "Redemption of
Shares" in each Prospectus.
- --------------------------------------------------------------------------------
NET ASSET VALUE
Each of the Funds will compute the net asset value per share for each of
its classes once daily on Monday through Friday as described under "Net
Asset Value" in the relevant Prospectus, except that net asset value of
any class need not be computed on a day in which no orders to purchase or
redeem shares of such class have been received or on the following
holidays: New Year's Day, Martin Luther King Jr. Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day (observed), Labor Day,
Columbus Day, Veterans Day, Thanksgiving Day and Christmas Day. In
addition, net asset value need not be computed on any other day that the
New York Stock Exchange is closed for business.
Money Market Funds. In the case of the Money Market Funds, all portfolio
securities for each Fund will be valued by the amortized cost method. The
purpose of this method of calculation is to attempt to maintain a
constant net asset value of $1.00 per share for each class of shares. No
assurances can be given that this goal will be attained. The amortized
cost method of valuation values a security at its cost at the time of
purchase and thereafter assumes a constant amortization to maturity of
any discount or premium, regardless of the impact of fluctuating interest
rates on the market value of the instrument. If a difference of more than
.5% occurs between valuation based on the amortized cost method and
valuation based on market value, the Directors will take steps necessary
to reduce such deviation, such as changing dividend policy, shortening
the average portfolio maturity or realizing gains or losses. See "Taxes".
Valuing the Money Fund's and the Treasury Money Fund's instruments on the
basis of amortized cost and use of the term "money market fund" are
permitted by Rule 2a-7 of the 1940 Act. Rule 2a-7 prohibits money market
funds that use the amortized cost method to value assets from investing
more than 5% of their total assets in the securities of any single
issuer, except obligations of the United States government and its
agencies and instrumentalities. Each of the Money Market Funds intend to
conduct their investment activities in a manner consistent with the
requirements of Rule 2a-7. This is not, however, a fundamental policy and
may be changed by the Directors at any time without the approval of the
shareholders of either of the Money Market Funds.
The Directors oversee the Adviser's adherence to the Securities and
Exchange Commission's rules, and have established procedures designed to
stabilize net asset value of each class of shares of the Money Fund and
the Treasury Money Fund at $1.00. Each day net asset value is computed,
each class of shares of the Money Fund and the Treasury Money Fund will
calculate the net asset value of each class of their respective shares by
using both the amortized cost method and market valuations. At such
intervals as they deem appropriate, the Directors
49
<PAGE>
consider the extent to which net asset value as calculated by using market
valuations would deviate from $1.00 per share. Immediate action will be taken
by the Directors if the variance between market value and amortized cost
exceeds .5%.
If the Directors believe that a deviation from the Money Fund's or
Treasury Money Fund's amortized cost per share may result in material
dilution or other unfair results to shareholders, the Directors have
agreed to take such corrective action, if any, as they deem appropriate
to eliminate or reduce, to the extent reasonably practicable, the
dilution or unfair results. Such corrective action could include selling
portfolio instruments before maturity to realize capital gains or losses
or to shorten average portfolio maturity; withholding dividends;
redeeming shares in kind; establishing net asset value by using available
market quotations; and such other measures as the Directors may deem
appropriate.
During periods of declining interest rates, the Money Fund's and the
Treasury Money Fund's yield based on amortized cost may be higher than
the corresponding yields based on market valuations. Under these
circumstances, a shareholder of any class of shares of the Money Fund or
the Treasury Money Fund would be able to obtain a somewhat higher yield
than would result if that Fund used market valuations to determine its
net asset value. The converse would apply in a period of rising interest
rates.
Taxable Fixed Income and Tax-Exempt Fixed Income Funds. In the case of
the Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds,
portfolio securities with a maturity of 60 days or more, including
securities listed on an exchange or traded over the counter, will be
valued using prices supplied daily by an independent pricing service or
services that (i) are based on the last sale price on a national
securities exchange, or in the absence of recorded sales, at the readily
available closing bid price on such exchange or at the quoted bid price
in the over-the-counter market, if such exchange or market constitutes
the broadest and most representative market for the security, and (ii) in
other cases, take into account various factors affecting market value,
including yields and prices of comparable securities, indication as to
value from dealers and general market conditions. If such prices are not
supplied by the Funds' independent pricing service, such securities will
be priced in accordance with procedures adopted by the Directors. All
portfolio securities with a remaining maturity of less than 60 days are
valued by the amortized cost method, because the Directors have
determined that this method will approximate market value. Because of the
large number of municipal bond issues outstanding and the varying
maturity dates, coupons and risk factors applicable to each issuer's
books, no readily available market quotations exist for most municipal
securities.
Equity Funds . In the case of the Equity Funds, the value of investments
listed on a domestic securities exchange, other than options on stock
indexes, is based on the last sale price as of the close of regular
trading hours on the New York Stock Exchange or, in the absence of
recorded sales, at the average of readily available closing bid and asked
prices on such exchange. Securities listed on a foreign exchange are
valued at the last quoted sale price available before the time when net
assets are valued. Unlisted securities are valued at the average of the
quoted bid and asked prices in the over-the-counter market. The value of
each security for which
50
<PAGE>
readily available market quotations exist is based on a decision as to the
broadest and most representative market for such security.
Equity Funds and Intermediate Investment Grade Fund. For purposes of
calculating net asset value per share for each class of shares in each of
the Equity Funds and the Intermediate Investment Grade Fund, all assets
and liabilities initially expressed in foreign currencies will be
converted into United States dollars at the prevailing market rates
available at the time of valuation.
All Funds (except Money Market Funds). Options on stock indexes traded on
national securities exchanges are valued at the close of options trading
on such exchanges, which is currently 4:10 P.M., New York City time.
Stock index futures and related options, which are traded on commodities
exchanges, are valued at their last sales price as of the close of such
commodities exchanges, which is currently 4:15 P.M., New York City time.
Securities or other assets for which market quotations are not readily
available are valued at fair value in accordance with procedures
established by and under the general supervision and responsibility of
the Fund's Directors. Such procedures include the use of independent
pricing services which use prices based upon yields or prices of
securities of comparable quality, coupon, maturity and type; indications
as to values from dealers; and general market conditions. Short-term
investments, which mature in 60 days or less, are valued at amortized
cost if their original maturity was 60 days or less, or by amortizing
their value on the 61st day prior to maturity, if their original maturity
when acquired by a Fund was more than 60 days, unless this is determined
not to represent fair value by the Directors.
Trading in securities on most foreign exchanges and over-the-counter
markets is normally completed before the close of the New York Stock
Exchange and may also take place on days on which the New York Stock
Exchange is closed. If events materially affecting the value of foreign
securities occur between the time when the exchange on which they are
traded closes and the time when a Fund's net asset value is calculated,
such securities will be valued at fair value in accordance with
procedures established by and under the general supervision of the Funds'
Directors.
- --------------------------------------------------------------------------------
PERFORMANCE DATA
From time to time, the Funds may quote performance in terms of yield,
actual distributions, total return, or capital appreciation in reports,
sales literature, and advertisements published by the Funds. Current
performance information for the Funds may be obtained by calling the
number provided on the cover page of this Statement of Additional
Information.
Yield Quotations. As required by regulations of the Securities and
Exchange Commission, current yield for each class of shares of the Money
Fund and the Treasury Money Fund is computed by determining 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 a
seven-day
51
<PAGE>
calendar period, dividing the net change in account by the value of the
account at the beginning of the period, and multiplying the return over the
seven-day period by 365/7. For purposes of the calculation, net change in
account value reflects the value of additional shares purchased with dividends
from the original share and dividends declared on both the original share and
any such additional shares, but does not reflect realized gains or losses or
unrealized appreciation or depreciation. Effective yield for each class of
shares of the Money Fund and the Treasury Money Fund is computed by
annualizing the seven-day return with all dividends reinvested in additional
Fund shares.
The current and effective seven-day yields for the Money Market Funds as
of December 31, 1997 were as follows:
<TABLE>
<CAPTION>
Current 7 Effective 7
Day Yield Day Yield
-------------------- ----------------------
<S> <C> <C>
Money Fund - Hamilton Shares 5.54% 5.69%
- ------------------------------ ----- -----
Money Fund - Hamilton Premier Shares 5.27% 5.41%
- -------------------------------------- ----- -----
Money Fund - Hamilton Classic Shares 4.93% 5.05%
- -------------------------------------- ----- -----
Treasury Money Fund - Hamilton Shares 5.46% 5.61%
- --------------------------------------- ----- -----
Treasury Money Fund - Hamilton Premier Shares 5.21% 5.35%
- ----------------------------------------------- ----- -----
</TABLE>
As required by regulations of the Securities and Exchange Commission, the
annualized yield for each of the Taxable Fixed Income Funds, the
Tax-Exempt Fixed Income Funds and the Equity Income Fund is computed by
dividing the Fund's net investment income per share for each class earned
during a 30-day period by the net asset value on the last day of the
period. The average daily number of shares outstanding during the period
that are eligible to receive dividends will be used in determining the
net investment income per share. Income will be computed by totaling the
interest earned on all debt obligations, and in the case of the Equity
Income Fund, dividends earned on all equity securities, during the period
and subtracting from that amount the total of all recurring expenses
incurred during the period. The 30-day yield will then be annualized on a
bond-equivalent basis assuming semi-annual reinvestment and compounding
of net investment income, as described under "Additional Information" in
the Prospectus for the Equity Funds, the Taxable Fixed Income Funds and
the Tax-Exempt Fixed Income Funds.
The 30-day yields for the Taxable Fixed Income Funds and the Tax-Exempt
Fixed Income Funds are as follows:
52
<PAGE>
<TABLE>
<CAPTION>
With Without
Reimbursement Reimbursement
---------------------- -----------------------
<S> <C> <C>
Intermediate Government Fund - Institutional Shares......... 5.42% 5.34%
- -------------------------------------------------------------- ----- -----
Intermediate Government Fund - Investor Shares.............. 5.17% 5.05%
- -------------------------------------------------------------- ----- -----
Intermediate Investment Grade Fund - Institutional Shares... 5.75% 5.75%
- -------------------------------------------------------------- ----- -----
Intermediate Investment Grade Fund - Investor Shares........ 5.48% 5.48%
- -------------------------------------------------------------- ----- -----
Intermediate New York Tax-Exempt Fund - Institutional Shares 3.52% 3.25%
- -------------------------------------------------------------- ----- -----
Intermediate New York Tax-Exempt Fund - Investor Shares..... 3.27% 3.00%
- -------------------------------------------------------------- ----- -----
Intermediate Tax-Exempt Fund - Institutional Shares......... 3.84% 3.84%
- -------------------------------------------------------------- ----- -----
Intermediate Tax-Exempt Fund - Investor Shares.............. 3.54% 3.55%
- -------------------------------------------------------------- ----- -----
</TABLE>
Total Return Quotations. As required by regulations of the Securities and
Exchange Commission, the annualized total return of each of the Equity
Funds, the Taxable Fixed Income Funds and the Tax-Exempt Fixed Income
Funds for a period will be computed by assuming a hypothetical initial
payment of $10,000. It will then be assumed that all of the dividends and
distributions over the period are reinvested and that the entire amount
will be redeemed at the end of the period. The annualized total return
will then be calculated by determining the annual rate required for the
initial payment to grow to the amount which would have been received upon
redemption. Aggregate total returns, reflecting the cumulative percentage
change over a measuring period, may also be calculated.
The total returns for the Funds are as follows:
53
<PAGE>
<TABLE>
<CAPTION>
Average Average
Annual Annual
for the For the
One-Year Five-Year
Period Period
Aggregate Ended Ended
Inception Since December 31, December 31,
Date Inception 1997 1997
---- --------- ---- ----
---------- ---------- ------------- --------------
<S> <C> <C> <C> <C>
Intermediate Government Fund - Institutional 04/01/97 8.27% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
Shares..........................................
------------------------------------------------
Intermediate Government Fund - Investor Shares. 08/10/92 31.82% 7.54% 5.57%
- -------------------------------------------------- -------- ------ ----- -----
Intermediate Investment Grade Fund - 04/01/97 9.34% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
Institutional Shares.............................
- --------------------------------------------------
Intermediate Investment Grade Fund - Investor 05/01/97 7.76% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
Shares..........................................
------------------------------------------------
Intermediate New York Tax-Exempt Fund -
- --------------------------------------------------
Institutional Shares.......................... 04/01/97 6.69% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
Intermediate New York Tax-Exempt Fund - Investor 08/10/92 29.43% 6.19% 5.05%
- -------------------------------------------------- -------- ------ ----- -----
Shares..........................................
------------------------------------------------
Intermediate Tax-Exempt Fund - Institutional 04/01/97 6.50% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
Shares..........................................
------------------------------------------------
Intermediate Tax-Exempt Fund - Investor Shares. 05/01/97 6.08% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
Equity Income Fund - Institutional Shares...... 04/01/97 24.73% N/A N/A
- -------------------------------------------------- -------- ------ --- ---
Equity Income Fund - Investor Shares........... 08/10/92 118.54% 25.85% 15.59%
- -------------------------------------------------- -------- ------- ------ ------
Large Cap Growth Fund - Institutional Shares... 04/01/97 29.11% N/A N/A
- -------------------------------------------------- -------- ------ --- ---
Large Cap Growth Fund - Investor Shares........ 05/01/97 20.37% N/A N/A
- -------------------------------------------------- -------- ------ --- ---
Small Cap Growth Fund - Institutional Shares... 04/01/97 27.80% N/A N/A
- -------------------------------------------------- -------- ------ --- ---
Small Cap Growth Fund - Investor Shares........ 05/01/97 27.52% N/A N/A
- -------------------------------------------------- -------- ------ --- ---
International Equity Fund - Institutional Shares 04/01/97 6.90% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
International Equity Fund - Investor Shares.... 05/01/97 6.60% N/A N/A
- -------------------------------------------------- -------- ----- --- ---
</TABLE>
General. A Fund's performance will vary from time to time depending upon
market conditions, the composition of its portfolio, and its operating
expenses. Consequently, any given performance quotation should not be
considered representative of a Fund's performance for any specified
period in the future. In addition, because performance will fluctuate, it
may not provide a basis for comparing an investment in a Fund with
certain bank deposits or other investments that pay a fixed yield or
return for a stated period of time.
From time to time, the yields and the total returns of each class of
shares of the Funds may be quoted in and compared to other mutual funds
with similar investment objectives in advertisements, shareholder reports
or other communications to shareholders. The Funds may also include
calculations in such communications that describe hypothetical investment
results. (Such performance examples will be based on an express set of
assumptions and are not indicative of the performance of any Fund.) Such
calculations may from time to time include discussions or illustrations
of the effects of compounding in advertisements. "Compounding" refers to
the fact that, if dividends or other distributions on a Fund investment
are reinvested by being paid in additional Fund shares, any future income
or capital appreciation of a Fund would increase the value, not only of
the original Fund investment, but also of the additional Fund shares
received through reinvestment. As a result, the value of the Fund
investment would increase more quickly than if dividends or other
distributions had been paid in cash. The Funds may also include
discussions or illustrations of the potential investment goals of a
prospective investor (including but not limited to tax and/or retirement
planning), investment management techniques, policies or investment
suitability of a Fund, economic conditions, legislative developments
(including pending legislation), the effects of inflation and historical
performance of various asset classes, including but not limited to
stocks, bonds and Treasury bills. From time to time, advertisements or
communications to shareholders may summarize the substance of
54
<PAGE>
information contained in shareholder reports (including the investment
composition of a Fund), as well as, the views of the investment adviser as to
current market, economic trade and interest rate trends, legislative,
regulatory and monetary developments, investments strategies and related
matters believed to be of relevance to a Fund. The Funds may also include in
advertisements charts, graphs or drawings which illustrate the potential risks
and rewards of investment in various investment vehicles, including but not
limited to stocks, bonds, Treasury bills and shares of a Fund. In addition,
advertisements or shareholder communications may include a discussion of
certain attributes or benefits to be derived by an investment in a Fund. Such
advertisements or communications may include symbols, headlines or other
material which highlight or summarize the information discussed in more detail
therein. With proper authorization, a Fund may reprint articles (or excerpts)
written regarding the Fund and provide them to prospective shareholders.
Performance information with respect to the Funds is generally available by
calling 1-800-4BNY-FND (1-800-426-9363).
Comparative performance information may be used from time to time in
advertising the Funds' shares, including, but not limited to, data from
Lipper Analytical Services, Inc., the S&P 500 Composite Stock Price
Index, the Dow Jones Industrial Average, the Lehman Brothers indexes, the
Frank Russell Indexes and other industry publications. Each of the Money
Market Funds may compare the performance of each class of shares to Money
Fund Report, a service of IBC Financial Data, Inc. as well as yield data
reported in other national financial publications.
From time to time, the Funds may include general comparative information
such as statistical data regarding inflation, securities indices or the
features of performance of alternative investments, in advertisements,
sales literature and reports to shareholders. The Funds may also include
calculations, such as hypothetical compounding examples, which describe
hypothetical investment results in such communications. Such performance
examples will be based on an express set of assumptions and are not
indicative of the performance of any Fund. In addition, in such
communications, the investment adviser may offer opinions on current
economic conditions.
- --------------------------------------------------------------------------------
PORTFOLIO TRANSACTIONS AND BROKERAGE
Fixed-income and debt securities and municipal bonds and notes are
generally traded at a net price with dealers acting as principal for
their own accounts without a stated commission. The price of the security
usually includes profit to the dealers. In underwritten offerings,
securities are purchased at a fixed price which includes an amount of
compensation to the underwriter, generally referred to as the
underwriter's concession or discount. On occasion, certain securities may
be purchased directly from an issuer, in which case no commissions or
discounts are paid.
Portfolio Turnover. A Fund's investment policies may lead to frequent
changes in investments, particularly in periods of rapidly fluctuating
interest rates. A change in securities held by a Fund is known as
"portfolio turnover" and may involve the payment by the Fund of dealer
spreads or underwriting commissions, and other transaction costs, on the
sale of
55
<PAGE>
securities, as well as on the reinvestment of the proceeds in other
securities. A Fund's portfolio turnover rate is calculated by dividing the
lesser of purchases or sales of portfolio securities for the fiscal year by
the monthly average of the value of the portfolio securities owned during the
year. Securities whose maturity or expiration date at the time of acquisition
were one year or less are excluded from the calculation. For the fiscal years
ended December 31, 1995, 1996, and 1997, the portfolio turnover rates for the
Intermediate New York Tax-Exempt Fund and the Equity Income Fund were 4%, 22%
and 21%; 58%, 58% and 65%, respectively. It is anticipated that the
Intermediate New York Tax-Exempt Fund and the Equity Income Fund will continue
to have a portfolio turnover rate of less than 100%.
For the period April 1, 1997 (commencement of operations) to December 31,
1997, the portfolio turnover rates for the Intermediate Investment Grade
Fund, Intermediate Tax-Exempt Fund, Large Cap Growth Fund, Small Cap
Growth Fund and International Equity Fund were 81%, 30%, 37%, 68% and
36%, respectively. It is anticipated that the Intermediate Investment
Grade Fund, Intermediate Tax-Exempt Fund, Large Cap Growth Fund, Small
Cap Growth Fund and International Equity Fund will continue to have a
portfolio turnover rate of less than 100%.
For the fiscal years ended December 31, 1995, 1996, and 1997, the
portfolio turnover rates for the Intermediate Government Fund were 48%,
57% and 41%, respectively. It is anticipated that the Intermediate
Government Fund will continue to have a portfolio turnover rate of not
greater than 200%. The fixed income securities in which the Fund will
invest are generally traded at a net price with dealers acting as
principal for their own accounts and without brokerage commissions.
However, other expenses, such as custodial fees and wire charges may be
higher during periods of higher turnover.
Money Market Funds, Taxable Fixed Income Funds and Tax-Exempt Fixed
Income Funds. Portfolio transactions for each of the Money Market Funds,
the Taxable Fixed Income Funds and the Tax-Exempt Fixed Income Funds will
be undertaken principally to accomplish a Fund's objective in relation to
expected movements in the general level of interest rates. Each of the
Money Market Funds, the Taxable Fixed Income Funds and the Tax-Exempt
Fixed Income Funds may engage in short-term trading consistent with their
objectives.
Each of the Money Market Funds' policy of investing only in securities
with maturities of less than 397 days will result in high portfolio
turnover. Since brokerage commissions are not normally paid on
investments that the Money Market Funds make, turnover resulting from
such investments should not adversely affect the net asset value or net
income of the Fund.
Equity Funds. In connection with portfolio transactions for the Equity
Funds, the overriding objective is to obtain the best possible execution
of purchase and sale orders. In selecting a broker, the Adviser (and, in
the case of the International Equity Fund, the sub-adviser) considers a
number of factors including: the price per unit of the security; the
broker's reliability for prompt, accurate confirmations and on-time
delivery of securities; the firm's financial condition; as well as the
commissions charged. A broker may be paid a brokerage commission in
excess of that which another broker might have charged for effecting the
same transaction if, after
56
<PAGE>
considering the foregoing factors, the Adviser decides that the broker chosen
will provide the best possible execution. The Adviser will monitor the
reasonableness of the brokerage commissions paid in light of the execution
received. The Directors will review regularly the reasonableness of
commissions and other transaction costs incurred by the Equity Funds in light
of facts and circumstances deemed relevant from time to time, and, in that
connection, receive reports from the Adviser and published data concerning
transaction costs incurred by institutional investors generally. Research
services provided by brokers to which the Adviser has allocated brokerage
business in the past include economic statistics and forecasting services,
industry and company analyses, portfolio strategy services, quantitative data,
and consulting services from economists and political analysts. Research
services furnished by brokers are used for the benefit of all the Adviser's
clients and not solely or necessarily for the benefit of an individual Fund.
The Adviser believes that the value of research services received is not
determinable and does not significantly reduce its expenses. The Equity Funds
do not reduce their respective fees paid to the Adviser by any amount that
might be attributable to the value of such services.
For the fiscal years ended December 31, 1995, 1996, and 1997, the Equity
Income Fund paid aggregate broker commissions of $203,878, $129,028 and
$481,922, respectively.
Subject to the overriding objective of obtaining the best possible
execution of orders, the Adviser may allocate a portion of any or all of
the Equity Funds' portfolio brokerage transactions to affiliates of the
Adviser. In order for affiliates of the Adviser to effect any portfolio
transactions for the Equity Funds, the commissions, fees or other
remuneration received by such affiliates must be reasonable and fair
compared to the commissions, fees, or other remuneration paid to other
brokers in connection with comparable transactions involving similar
securities being purchased or sold on a securities exchange during a
comparable period of time. Furthermore, the Directors, including a
majority of the Directors who are not "interested persons", have adopted
procedures which are reasonably designed to provide that any commissions,
fees, or other remuneration paid to such affiliates are consistent with
the foregoing standard.
Portfolio securities will not be purchased from or through or sold to or
through the Funds' Administrator, Distributor or Adviser or any
"affiliated person", as defined in the 1940 Act, of the
Co-Administrators, Distributor or Adviser when such entities are acting
as principals, except to the extent permitted by law. In addition, the
Funds will not purchase securities during the existence of any
underwriting group relating thereto of which the Adviser or an affiliate
of the Adviser is a member, except to the extent permitted by law.
On those occasions when the Adviser deems the purchase or sale of a
security to be in the best interests of a Fund as well as other
customers, including the other Funds, to the extent permitted by
applicable laws and regulations, the Adviser may, but is not obligated
to, aggregate the securities to be sold or purchased for the Fund with
those to be sold or purchased for other customers in order to obtain best
execution, including lower brokerage commissions if appropriate. In such
event, allocation of the securities so purchased or sold as well as any
expenses incurred in the transaction will be made by the Adviser, in the
manner it considers to
57
<PAGE>
be most equitable and consistent with the Adviser's fiduciary obligations to
the Fund. In some instances, this procedure might adversely affect a Fund.
If a Fund effects a closing purchase transaction with respect to an
option written by it, normally such transaction will be executed by the
same broker-dealer who executed the sale of the option. The writing of
options by a Fund will be subject to limitations established by each of
the exchanges governing the maximum number of options in each class which
may be written by a single investor or group of investors acting in
concert, regardless of whether the options are written on the same or
different exchanges or are held or written in one or more accounts or
through one or more brokers. The number of options which a Fund may write
may be affected by options written by the Adviser for other investment
advisory clients. An exchange may order the liquidation of positions
found to be in excess of these limits, and it may impose certain other
sanctions.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES
BNY Hamilton Funds, Inc. (the "Corporation") is a registered, open-end
investment company organized under the laws of the State of Maryland. The
Articles of Incorporation of the Corporation currently permit the
Corporation to issue 20,000,000,000 shares of common stock, par value
$.001 per share, of which shares have been classified as follows:
<TABLE>
<CAPTION>
Number of Shares of
Name of Series and Classes Thereof Common Allocated
- ---------------------------------- ----------------------------
<S> <C>
BNY Hamilton Money Fund
- Hamilton Shares........................................................ 3,000,000,000
- Hamilton Premier Shares................................................ 3,000,000,000
- Hamilton Classic Shares................................................ 3,000,000,000
BNY Hamilton Treasury Money Fund
- Hamilton Shares........................................................ 2,000,000,000
- Hamilton Premier Shares................................................ 2,000,000,000
BNY Hamilton Equity Income Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
BNY Hamilton Large Cap Growth Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
BNY Hamilton Small Cap Growth Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
BNY Hamilton International Equity Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
</TABLE>
58
<PAGE>
<TABLE>
<S> <C>
BNY Hamilton Intermediate Government Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
BNY Hamilton Intermediate Investment Grade Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
BNY Hamilton Intermediate New York Tax-Exempt Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
BNY Hamilton Intermediate Tax-Exempt Fund
- Institutional Shares................................................... 200,000,000
- Investor Shares........................................................ 200,000,000
Undesignated Common Stock....................................................... 3,800,000,000
</TABLE>
Shares of the Corporation do not have preemptive or conversion rights and
are fully paid and nonassessable by the Corporation. The rights of
redemption and exchange are described in the appropriate Prospectus and
elsewhere in this Statement of Additional Information.
The shareholders of each Fund are entitled to a full vote for each full
share held and to a fractional vote for each fractional share. Subject to
the 1940 Act and Maryland law, the Directors themselves have the power to
alter the number and the terms of office of the Directors, to lengthen
their own terms, or to make their terms of unlimited duration subject to
certain removal procedures, and appoint their own successor; provided,
however, that immediately after such appointment the requisite majority
of the Directors have been elected by the shareholders of the Funds. The
voting rights of shareholders are not cumulative so that holders of more
than 50% of the shares voting can, if they choose, elect all Directors
being selected while the holders of the remaining shares would be unable
to elect any Directors. It is the intention of the Corporation not to
hold annual shareholder meetings. The Directors may call shareholder
meetings for action by shareholder vote as may be required by either the
1940 Act or the Articles of Incorporation.
The Corporation, if requested to do so by the holders of at least 10% of
shareholders of all series aggregated as a class, will call a meeting of
shareholders for the purpose of voting upon the question of the removal
of a director or directors and will assist in communications with other
shareholders as required by Section 16(c) of the 1940 Act.
The Articles of Incorporation contain a provision permitted under the
Maryland General Corporation Law that under certain circumstances
eliminates the personal liability of the Directors to the Corporation or
its shareholders. The Articles of Incorporation and the Bylaws of the
Corporation provide that the Corporation will indemnify the Directors,
officers and employees of the Funds to the full extent permitted by the
Maryland General Corporation Law, which permits indemnification of such
persons against liabilities and expenses incurred in connection with
proceedings in which they may be involved because of their offices or
employment with the Corporation. However, nothing in the Articles of
Incorporation or the Bylaws of the Corporation protects or indemnifies a
Director, officer or employee against any
59
<PAGE>
liability to the Corporation or its shareholders to which he or she would
otherwise be subject by reason of willful malfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
or her office.
For information relating to mandatory redemption of Fund shares or, under
certain circumstances, their redemption at the option of the Funds, see
"Redemption of Shares" in the Prospectuses.
No single person beneficially owns 25% or more of the Corporation's
voting securities. The following table sets forth the name, address and
percentage of ownership of each person who is known by the Registrant to
own, of record or beneficially, 5% or more of any class of the
Corporation's outstanding equity securities as of March 31, 1998:
<TABLE>
<CAPTION>
Fund Of Record % Beneficial Owner %
- ---- --------- - ---------------- -
<S> <C> <C> <C> <C>
Money NONE Duke University 6.00%
100 N. Tryon Street ------
Charlotte, NC 28202
Intermediate Government The Bank of New York 32.23% The Bank of New York 42.44%
Profit Sharing Plan B ------ 48 Wall Street ------
48 Wall Street New York, NY 10286
New York, NY 10286
The Bank of New York 5.43%
Long-Term Disability Plan -----
48 Wall Street
New York, NY 10086
Intermediate New York NONE Robert J. Milano 8.20%
Tax-Exempt 860 United Nations Plaza -----
New York, NY 10017
Equity Income The Bank of New York 21.29% The Bank of New York 22.99%
Profit Sharing Plan A ------ 48 Wall Street ------
48 Wall Street New York, NY 10286
New York, NY 10286
Small Cap Growth The Bank of New York 7.75% The Bank of New York 7.75%
Profit Sharing Plan A ----- 48 Wall Street -----
48 Wall Street New York, NY 10286
New York, NY 10286
International Equity Indosuez Asset Management 5.08% Indosuez Asset Management 5.08%
Nine Rue Louis Murar ----- Nine Rue Louis Murar -----
Paris, France Paris, France
Treasury Money Ceridian Corp. Tax Filing Trust 5.89% Ceridian Corp. Tax Filing 5.89%
8100 34 Avenue South ----- Trust -----
Minneapolis, MN 55425 8100 34 Avenue South
Minneapolis, MN 55425
F W Olin Foundation 10.36% F W Olin Foundation 10.36%
780 Third Avenue ------ 780 Third Avenue ------
New York, NY 10017 New York, NY 10017
</TABLE>
60
<PAGE>
The Corporation's officers and directors, taken as a group, own less than
1% of the shares of each of the Funds.
- --------------------------------------------------------------------------------
TAXES
Each Fund generally will be treated as a separate corporation for federal
income tax purposes, and thus the provisions of the Tax Code generally
will be applied to each Fund separately, rather than the Corporation as a
whole. Net long-term and short-term capital gains, net income, and
operating expenses therefore will be determined separately for each Fund.
Each Fund within the Corporation intends to qualify as a regulated
investment company under Subchapter M of the Tax Code. Accordingly, each
Fund must, among other things, (a) derive at least 90% of its gross
income from dividends, interest, payments with respect to loans of stock
and securities, gains from the sale or other disposition of stock,
securities or foreign currency and other income (including but not
limited to gains from options, futures, and forward contracts) derived
with respect to its business of investing in such stock, securities or
foreign currency; and (b) diversify its holdings so that, at the end of
each fiscal quarter, (i) at least 50% of the value of the Fund's assets
is represented by cash, United States Government securities and other
securities, with such other securities limited, in respect of any one
issuer, to an amount not greater than 5% of the Fund's assets, and 10% of
the outstanding voting securities of such issuer and (ii) not more than
25% of the value of its assets is invested in the securities of any one
issuer (other than United States Government securities). As a regulated
investment company, a Fund (as opposed to its shareholders) will not be
subject to federal income taxes on the net investment income and capital
gains that it distributes to its shareholders, provided that at least 90%
of its net investment income and realized net short-term capital gains in
excess of net long-term capital losses for the taxable year is
distributed at least annually.
Under the Tax Code, a Fund will be subject to a 4% excise tax on a
portion of its undistributed income if it fails to meet certain
distribution requirements by the end of the calendar year. Each Fund
intends to make distributions in a timely manner and accordingly does not
expect to be subject to the excise tax.
For federal income tax purposes, dividends that are declared by a Fund in
October, November or December as of a record date in such month and
actually paid in January of the following year will be treated as if they
were paid on December 31 of the year declared. Therefore, such dividends
will generally be taxable to a shareholder in the year declared rather
than the year paid.
Distributions of net investment income and realized net short-term
capital gains in excess of net long-term capital losses (other than
exempt-interest dividends distributed by either of the Tax-Exempt Fixed
Income Funds, as described below) are generally taxable to shareholders
of the Funds as ordinary income whether such distributions are taken in
cash or reinvested in additional
61
<PAGE>
shares. Each of the Equity Funds (other than the International Equity Fund)
expects that a portion of these distributions to their respective corporate
shareholders will be eligible for the 70% dividends-received deduction. These
distributions from all other Funds will not be eligible for the
dividends-received deduction. Distributions of net long-term capital gains
(i.e., net long-term capital gains in excess of net short-term capital losses)
are taxable to shareholders of a Fund as long-term capital gains, regardless
of whether such distributions are taken in cash or reinvested in additional
shares and regardless of how long a shareholder has held shares in the Fund,
and are not eligible for the dividends-received deduction. Individual
shareholders will be subject to federal income tax on distributions of net
long-term capital gains at a maximum rate of 28% if designated as derived from
a Fund's capital gains from property held for more than one year and at a
maximum rate of 20% if designated as derived from property held for more than
eighteen months.
A gain or loss realized by a shareholder on the redemption, sale or
exchange of shares held as a capital asset will be capital gain or loss
and such gain or loss will be long-term if the holding period for the
shares exceeds one year, and otherwise will be short-term. Individual
shareholders will be subject to federal income tax on long-term capital
gain at a maximum rate of 28% in respect of shares held for more than one
year and at a maximum rate of 20% in respect of shares held for more than
eighteen months. Capital gain of a corporate shareholder is taxed at the
same rate as ordinary income. Any loss realized by a shareholder on the
disposition of shares held six months or less will be treated as a
long-term capital loss to the extent of any distributions of net
long-term capital gains received by the shareholder with respect to such
shares. Any such loss may be disallowed in the case of either of the
Tax-Exempt Fixed Income Funds. See "Tax-Exempt Fixed Income Funds" below.
Additionally, any loss realized on a redemption or exchange of shares of
a Fund will be disallowed to the extent the shares disposed of are
replaced within a period of 61 days beginning 30 days before such
disposition, such as pursuant to reinvestment of a dividend in shares of
the Fund.
Prospective investors in any of the Equity Funds, the Taxable Fixed
Income Funds and the Tax-Exempt Fixed Income Funds should be aware that
distributions of net investment income or net long-term capital gains
from these Funds will have the effect of reducing the net asset value of
each class of each Funds' shares by the amount of the distribution. If
the net asset value is reduced below a shareholder's cost, the
distribution will nonetheless be taxable as described above, even if the
distribution represents a return of invested capital. Investors should
consider the tax implications of buying shares in these Funds just prior
to a distribution, when the price of shares may reflect the amount of the
forthcoming distribution.
Gains or losses on sales of securities by a Fund will be treated as
long-term capital gains or losses if the securities have been held by it
for more than one year except in certain cases where, if applicable, a
Fund acquires a put or writes a call thereon. Other gains or losses on
the sale of securities will be short-term capital gains or losses. Gains
and losses on the sale, lapse or other termination of options on
securities will be treated as gains and losses from the sale of
securities. If an option written by a Fund lapses or is terminated
through a closing transaction, such as a repurchase by the Fund of the
option from its holder, the Fund will realize a short-term capital gain
or loss, depending on whether the premium income is greater or less than
the amount paid
62
<PAGE>
by the Fund in the closing transaction. If securities are purchased by the
Fund pursuant to the exercise of a put option written by it, the Fund will
subtract the premium received from its cost basis in the securities purchased.
If securities are sold by the Fund pursuant to the exercise of a call option
written by it, the Fund will include the premium received in the sale price
for the securities sold.
Under the Tax Code, gains or losses attributable to dispositions of
foreign currency or to foreign currency contracts, or to fluctuations in
exchange rates between the time a Fund accrues income or receivables or
expenses or other liabilities denominated in a foreign currency and the
time a Fund actually collects such income or pays such liabilities, are
treated as ordinary income or ordinary loss. Similarly, gains or losses
on the disposition of debt securities held by a Fund, if any, denominated
in foreign currency, to the extent attributable to fluctuations in
exchange rates between the acquisition and disposition dates, are also
treated as ordinary income or loss.
Forward currency contracts, options and futures contracts entered into by
a Fund may create "straddles" for federal income tax purposes and this
may affect the character and timing of gains or losses realized by a Fund
on forward currency contracts, options and futures contracts or on the
underlying securities.
Certain options, futures and foreign currency contracts held by a Fund at
the end of each fiscal year will be required to be "marked-to-market" for
federal income tax purposes -- i.e., treated as having been sold at
market value. For options and futures contracts, sixty percent of any
gain or loss recognized on these deemed sales and on actual dispositions
will be treated as long-term capital gain or loss, and the remainder will
be treated as short-term capital gain or loss, regardless of how long the
Fund has held such options or futures. Any gain or loss recognized on
foreign currency contracts will be treated as ordinary income, unless an
election under Section 988 (a) (1) (B) of the Tax Code is made, in which
case the rule for options and futures contracts will apply.
The International Equity Fund will, and the Equity Income Fund, the Large
Cap Growth Fund and the Small Cap Growth Fund may, invest in equity
securities of foreign issuers. If these Funds purchase shares in certain
foreign investment companies, known as "passive foreign investment
companies", they may be subject to federal income tax on a portion of an
"excess distribution" from such passive foreign investment companies or
gain from the disposition of such shares, even though such income may
have to be distributed as a taxable dividend by a Fund to its respective
shareholders. In addition, certain interest charges may be imposed on the
Equity Funds or its respective shareholders in respect of unpaid taxes
arising from such distributions or gains. Alternatively, the Equity Funds
would be required each year to include in its income and distribute to
shareholders a pro rata portion of the foreign investment company's
income, whether or not distributed to the Fund. For taxable years
beginning after 1997, the Equity Funds will be permitted to
"mark-to-market" any marketable stock held by a Fund in a passive foreign
investment company. If a Fund made such an election, each investor in the
Fund would include in income in each year an amount equal to its share of
the excess, if any, of the fair market value of the stock in such passive
foreign investment company as of the close of the taxable year over the
adjusted basis of such
63
<PAGE>
stock. The investor would be allowed a deduction for its share of the excess,
if any, of the adjusted basis of the stock in such passive foreign investment
company over the fair market value of such stock as of the close of the
taxable year, but only to the extent of any net mark-to-market gains with
respect to the stock included by the investor for prior taxable years.
It is expected that the Money Fund, the Equity Income Fund, the Large Cap
Growth Fund, the Small Cap Growth Fund, the International Equity Fund and
the Intermediate Investment Grade Fund may be subject to foreign
withholding taxes with respect to income received from sources within
foreign countries. The International Equity Fund intends to elect to
"pass through" to its investors the amount of foreign income taxes paid
by the Fund, with the result that each shareholder will (i) include in
gross income, even though not actually received, the pro rata share of
the Fund's foreign income taxes, and (ii) either deduct (in calculating
U.S. taxable income) or credit (in calculating U.S. federal income tax)
the pro rata share of the Fund's foreign income taxes. A foreign tax
credit may not exceed the U.S. federal income tax otherwise payable with
respect to the foreign source income. For this purpose, each shareholder
must treat as foreign source gross income (i) his proportionate share of
foreign taxes paid by the Fund and (ii) the portion of any dividend paid
by the Fund which represents income derived from foreign sources; the
gain from the sale of securities will generally be treated as U.S. source
income. This foreign tax credit limitation is, with certain exceptions,
applied separately to separate categories of income; dividends from the
will be treated as "passive" or "financial services" income for this
purpose. The effect of this limitation may be to prevent from claiming as
a credit the full amount of their pro rate share of the Fund's foreign
income taxes. In addition, effective for dividends paid after September
5, 1997, shareholders will not be eligible to claim a foreign tax credit
with respect to foreign income taxes paid by the Fund unless certain
holding period requirements are met.
Each Fund may be subject to state or local taxes in jurisdictions in
which the Fund is deemed to be doing business. In addition, the treatment
of a Fund and its shareholders in those states that have income tax laws
might differ from treatment under the federal income tax laws.
Shareholders should consult their own tax advisors with respect to any
state or local taxes.
Foreign Shareholders. Dividends of net investment income and
distributions of realized net short-term gains in excess of net long-term
losses to a shareholder who, as to the United States, is a non-resident
alien individual, fiduciary of a foreign trust or estate, foreign
corporation or foreign partnership (a "foreign shareholder") will be
subject to United States withholding tax at the rate of 30% (or lower
treaty rate) unless the dividends are effectively connected with a United
States trade or business of the shareholder, in which case the dividends
will be subject to tax on a net income basis at the graduated rates
applicable to United States individuals or domestic corporations.
Distributions of net long-term capital gains to foreign shareholders will
not be subject to United States tax unless the distributions are
effectively connected with the shareholder's trade or business in the
United States or, in the case of a foreign shareholder who is a
non-resident alien individual, the shareholder was present in the United
States for more than 182 days during the taxable year and certain other
conditions are met.
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In the case of a foreign shareholder who is a non-resident alien
individual and who is not otherwise subject to withholding as described
above, a Fund may be required to withhold United States federal income
tax at the rate of 31% unless IRS Form W-8 is provided.
Transfers by gift of shares of a Fund by a foreign shareholder who is a
non-resident alien individual will not be subject to United States
federal gift tax, but the value of shares of the Fund held by such a
shareholder at his or her death will be includible in his or her gross
estate for United States federal estate tax purposes.
Tax-Exempt Fixed Income Funds. Both of the Tax-Exempt Fixed Income Funds
intend to qualify to pay exempt-interest dividends to its respective
shareholders by having, at the close of each quarter of its taxable year,
at least 50% of the value of its total assets consist of tax-exempt
securities. An exempt-interest dividend is that part of dividend
distributions made by such Tax-Exempt Fixed Income Fund that consists of
interest received by the Fund on tax-exempt securities. Shareholders will
not incur any federal income tax on the amount of exempt-interest
dividends received by them from such Tax-Exempt Fixed Income Fund. In
view of each Tax-Exempt Fixed Income Fund's investment policies, it is
expected that substantially all dividends will be exempt-interest
dividends, although each Tax-Exempt Fixed Income Fund may from time to
time realize and distribute net short-term capital gains or other minor
amounts of taxable income.
Interest on indebtedness incurred or continued by a shareholder, whether
a corporation or an individual, to purchase or carry shares of either
Tax-Exempt Fixed Income Fund is not deductible to the extent it relates
to exempt-interest dividends received by the shareholder. Any loss
incurred on the sale or redemption of either Fund's shares held six
months or less will be disallowed to the extent of exempt-interest
dividends received with respect to such shares.
Interest on certain tax-exempt bonds that are private activity bonds
within the meaning of the Tax Code is treated as a tax preference item
for purposes of the alternative minimum tax, and any such interest
received by a Tax-Exempt Fixed Income Fund and distributed to
shareholders will be so treated for purposes of any alternative minimum
tax liability of shareholders. The Tax-Exempt Fixed Income Funds are
permitted to invest up to 20% of their respective assets in private
activity bonds the interest from which is a preference item for purposes
of alternative minimum tax. Moreover, exempt-interest dividends paid to a
corporate shareholder by a Tax-Exempt Fixed Income Fund (whether or not
from interest on private activity bonds) will be taken into account (i)
in determining the alternative minimum tax imposed on 75% of the excess
of adjusted current earnings over alternative minimum taxable income,
(ii) in calculating the environmental tax equal to .12% of a
corporation's modified alternative taxable income in excess of $2
million, and (iii) in determining the foreign branch profits tax imposed
on effectively connected earnings and profits (with adjustments) of
United States branches of foreign corporations.
Holders of shares of either class of either Tax-Exempt Fixed Income Fund
who are subject to New York State and New York City personal income taxes
on dividends will not be subject to such tax on distributions from the
respective Tax-Exempt Fixed Income Fund to the extent that
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the distributions qualify as exempt-interest dividends and represent income
attributable to federally tax-exempt obligations of the State of New York and
its subdivisions, agencies and instrumentalities (as well as certain other
federally tax-exempt obligations the interest on which is exempt from New York
State and New York City personal income taxes, such as, for example, certain
obligations of Puerto Rico). To the extent that distributions from either
class of either Tax-Exempt Fixed Income Fund are derived from other income,
including long- and short-term capital gains and income from securities
lending, such distributions will not be exempt from New York State or New York
City personal income taxes.
Distributions from either Tax-Exempt Fixed Income Fund are not excluded
in determining New York State or City franchise taxes on corporations and
financial institutions.
Annual statements as to the portion of distributions of both Tax-Exempt
Fixed Income Funds that is attributable to interest that is exempt from
federal income tax and, in the case of the Intermediate New York
Tax-Exempt Fund, New York State and City personal income tax will be
provided to shareholders shortly after the end of the taxable year.
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SPECIAL CONSIDERATIONS RELATING TO INVESTMENTS IN NEW YORK MUNICIPAL OBLIGATIONS
The following information is a summary of special factors affecting the
Intermediate New York Tax-Exempt Fund. It does not purport to be a
complete description and is based on information from official statements
relating to securities offerings of New York issuers and, with respect to
information about credit ratings, from newspaper reports.
Economic Outlook
New York (the "State") is the third most populous state in the nation and
has a relatively high level of personal wealth. The State's economy is
diverse with a comparatively large share of the nation's finance,
insurance, transportation, communications and services employment, and a
very small share of the nation's farming and mining activity. The State's
location, air transport facilities and natural harbors have made it an
important link in international commerce. Travel and tourism constitute
an important part of the economy. Like the rest of the nation, New York
has a declining proportion of its workforce engaged in manufacturing and
an increasing proportion engaged in service industries.
The economic and financial condition of the State may be affected by various
financial, social, economic and political factors. Those factors can be very
complex, may vary from fiscal year to fiscal year, and are frequently the
result of actions taken not only by the State and its agencies and
instrumentalities, but also by entities, such as the federal government, that
are not under the control of the State. The state financial plan is based upon
forecasts of national and State economic activity. Economic forecasts have at
times failed to predict precisely the timing and magnitude of changes in the
national and the State economies. Many uncertainties exist in
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forecasts of both the national and State economies, including consumer
attitudes toward spending, the extent of corporate and governmental
restructuring, federal fiscal and monetary policies, the level of interest
rates, and the condition of the world economy, which could have an adverse
effect on the State. There can be no assurance that the State economy will not
experience results in the current fiscal year that are worse than predicted,
with corresponding material and adverse effects on the State's projections of
receipts and disbursements.
The national economy has resumed a more robust rate of growth after a
"soft landing" in 1995, with approximately 14 million jobs added
nationally since early 1992. The State economy has continued to expand,
but growth remains somewhat slower than in the nation. Although the State
has added approximately 300,000 jobs since late 1992, employment growth
in the State has been hindered during recent years by significant
cutbacks in the computer and instrument manufacturing, utility, defense,
and banking industries. Government downsizing has also moderated these
job gains.
At the national level, although the current projection is for a faster
annual growth rate for 1998 as a whole and slower annual growth for 1999,
growth in both years is still expected to be substantially slower than it
was during 1997. Projections for Real Gross Domestic Product ("GDP")
growth of 2.6 percent in 1998, is more than a full percentage point lower
than the estimated 1997 growth rate. In 1999, real GDP growth is expected
to fall even further to 2.0 percent. The growth of nominal GDP is
projected to decline from 5.8 percent in 1997 to 4.8 percent in 1998 and
4.3 percent in 1999. The inflation rate is expected to drop to 2.2
percent in 1998 before rising to 2.5 percent in 1999. The annual rate of
job growth is expected to be 2.3 percent in 1998, equaling the strong
growth rate experienced in 1997. In 1999, however, employment growth is
forecast to slow markedly to 1.3 percent. Growth in personal income and
wages is expected to slow in 1998 and again in 1999.
At the State level, moderate growth is projected to continue in 1998 and
1999 for employment, wages, and personal income, although the growth
rates will lessen gradually during the course of the two years. Personal
income is estimated to grow by 5.4 percent in 1997, fueled in part by a
continued large increase in financial sector bonus payments, and is
projected to grow 4.7 percent in 1998 and 4.4 percent in 1999. Increases
in bonus payments at year-end 1998 are projected to be modest, a
substantial change from the rate of increase of the last few years.
Overall employment growth is expected to continue at a modest rate,
reflecting the slowing growth in the national economy, continued spending
restraint in government, and restructuring in the health care, social
service, and banking sectors.
Current Fiscal Year
Overview
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The State's current fiscal year commenced on April 1, 1997, and ends on March
31, 1998, and is referred to herein as the State's 1997-98 fiscal year. The
State's budget for the 1997-98 fiscal year was adopted by the Legislature on
August 4, 1997, more than four months after the start of the fiscal year.
Prior to adoption of the budget, the Legislature enacted appropriations for
disbursements considered to be necessary for State operations and other
purposes, including necessary appropriations for State-supported debt service.
The State Financial Plan for the 1997-98 fiscal year was formulated on August
11, 1997 and is based on the State's budget as enacted by the Legislature , as
well as actual results for the first quarter of the current fiscal year. The
State is required to issue three quarterly modifications to the State
Financial Plan in July, October, and January.
The adopted 1997-98 budget projects that General Fund disbursements will
increase by $565 million over the Mid-Year Update projection of $1.7
billion or 5.2 percent over 1996-97 levels. The average annual growth
rate over the last three fiscal years is approximately 1.2 percent. State
Funds disbursements (excluding federal grants) are projected to increase
by 5.4 percent from the 1996-97 fiscal year.
The 1997-98 State Financial Plan continues to be balanced on a cash
basis. The Financial Plan projections include a reserve (from the General
Fund) for future needs of $1.83 billion, an increase of $1.3 billion over
the surplus estimate of $530 million in the Mid-Year Update. As compared
to the Governor's Executive Budget as amended in February 1997, the
State's adopted budget for 1997-98 increases General Fund spending by
$2.3 billion, primarily from increases for local assistance ($1.3
billion) and one-time disbursements that pre-pay expenditures previously
scheduled for 1998-99 ($561 million). Resources used to fund these
additional expenditures include increased revenues projected for the
1997-98 fiscal year, increased resources produced in the 1996-97 fiscal
year that will be utilized in 1997-98, reestimates of social service,
fringe benefit and other spending, and certain non-recurring resources.
Total non-recurring resources included in the 1997-98 Financial Plan are
projected by the Division of Budget (the "DOB") to be $270 million, or
0.7 percent of total General Fund receipts.
The 1997-98 Financial Plan also includes a projected balance of $332
million in the Tax Stabilization Reserve Fund and a projected $65 million
balance in the Contingency Reserve Fund.
The 1997-98 adopted budget includes multi-year tax reductions, including
a State funded property and local income tax reduction program, estate
tax relief, utility gross receipts tax reductions, permanent reductions
in the State sales tax on clothing, and elimination of assessments on
medical providers. These reductions are intended to reduce the overall
level of State and local taxes in New York and to improve the State's
competitive position vis-a-vis other states. The various elements of the
State and local tax and assessment reductions have little or no impact on
the 1997-98 Financial Plan, and do not begin to materially affect the
out-year projections until the State's 1999-2000 fiscal year. The adopted
1997-98 budget also makes significant investments in education, and
proposes a
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new $2.4 billion general obligation bond proposal for school facilities
submitted to the voters in November 1997, however the voters rejected the
proposal.
The projections do not include any subsequent actions that the Governor
may take to exercise his line-item veto (or vetoing any companion
legislation) before signing the 1997-98 budget appropriation bills into
law. Under the Constitution, the Governor may veto any additions to the
Executive Budget within 10 days after the submission of appropriation
bills for his approval. If the Governor were to take such action, the
resulting impact on the Financial Plan would be positive.
The four governmental fund types that comprise the State Financial Plan
are the General Fund, the Special Revenue Funds, the Capital Project
Funds, and the Debt Service Funds. This fund structure adheres to
accounting standards of the Governmental Accounting Standards Board. The
General Fund is the principal operating fund of the State and is used to
account for all financial transactions, except those required to be
accounted for in another fund. It is the State's largest fund and
receives almost all State taxes and other resources not dedicated to
particular purposes. In the State's 1997-98 fiscal year, the General Fund
is expected to account for approximately 48 percent of total Governmental
Funds disbursements and 71 percent of total State Funds disbursements.
General Fund moneys are also transferred to other funds, primarily to
support certain capital projects and debt service payments in other fund
types.
General Fund Receipts
Total General Fund receipts and transfers from other funds in the 1997-98
fiscal year are projected to be $35.2 billion, an increase of $2.2
billion or roughly 7 percent from the $33.04 billion recorded in the
1996-97 fiscal year. This total includes $31.63 billion in tax receipts
and $3.57 billion in miscellaneous receipts and transfers from other
funds. The projected $2.2 billion increase in receipts exaggerates the
underlying year-to-year growth in State tax revenues. This increase is
largely the result of actions undertaken by the State to utilize the $1.4
billion 1996-97 budget surplus reported by DOB to finance costs in the
State's 1997-98 fiscal year. This transaction reduced reported receipts
in the 1996-97 fiscal year and increased projected receipts in the
State's 1997-98 fiscal year. Conversely, the incremental costs of tax
reductions newly effective in 1997-98 and the impact of new earmarking
statutes which divert receipts from the General Fund to other funds work
to depress apparent growth below the underlying growth in the receipts
base attributable to expansion of the State's economy.
In order to make the surplus available to help finance 1998-99
requirements, the State plans to accelerate $1.18 billion in income tax
refund payments into 1997-98, or provide reserves for such payments. The
balance in the refund reserve on March 31, 1998 is projected to be $1.647
billion, including $521 million as a result of the Local Government
Assistance Corporation (the "LGAC"). This acceleration decreases reported
personal income receipts by $1.18 billion in 1997-98, while increasing
available personal income receipts in 1998-99, as these refunds will no
longer be a charge against current revenues in
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1998-99. As a result, projections of available receipts in 1997-98 have been
increased by only $103 million from the Mid-Year Update.
Personal income tax is imposed on the income of individuals, estates and
trusts and is based on federal definitions of income and deductions with
certain modifications. In 1995, the State enacted a tax-reduction program
designed to reduce receipts from the personal income tax by 20 percent
over three years. The maximum rate was reduced from the 7.875 percent
rate in effect in taxable year 1994 to 6.85 percent for taxable year 1997
and thereafter. For the 1997-98 fiscal year, this tax-reduction program
is estimated to reduce receipts by approximately $4 billion, compared to
what tax receipts would have been under the pre-1995 rate structure. On a
current law basis, 1997 income tax liability is expected to fall
slightly, reflecting the tax cut. On a constant law basis, liability
growth during taxable year 1997 would be between 6 and 7 percent.
Net personal income tax collections for 1997-98 are projected at $18.50
billion or $363 million less than projected in October 1997, but $2.1
billion above 1996-97 collections. Virtually all of the projected annual
growth in this category, however, is provided by tax refund and refund
reserve transactions which affect reported receipts levels in the 1995-96
through 1997-98 fiscal years. Without these transactions between years,
income tax receipts in 1997-98 would be virtually flat.
User taxes and fees are comprised of three-quarters of the State four
percent sales and use tax (the balance, one percent, flows to support
LGAC debt service requirements), cigarette, alcoholic beverage container,
and auto rental taxes, and a portion of the motor fuel excise levies.
Also included in this category are receipts from the motor vehicle
registration fees and alcoholic beverage license fees.
Receipts from user taxes and fees in 1997-98 are projected at $7.06
billion, as compared to $6.8 billion in 1996-97, and reflect a projected
loss of $20 million in sales tax receipts from an additional week of
sales tax exemption for clothing and footwear costing less than $500,
which was authorized and implemented in January 1998. The sales tax
component of this category accounts for all of the projected 1997-98
growth in this category, as receipts for all other sources are projected
to decline by $3 million. The yield of most of the excise taxes in this
category show a long-term declining trend, particularly cigarette and
alcoholic beverage taxes. These declines in the 1997-98 fiscal year are
projected to be offset by an increase in anticipated motor vehicle fees
arising, in large part, from legislative actions that raise additional
receipts from this source.
Business taxes include franchise taxes based generally on net income of
general business, bank and insurance corporations, as well as
gross-receipts-based taxes on utilities and gallonage-based petroleum
business taxes. Beginning in 1994, a 15 percent surcharge on these levies
began to be phased out and, for most taxpayers, there will be no
surcharge liability for taxable periods ending in 1997 and thereafter.
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Total business tax collections in 1997-98 are projected at $4.98 billion,
$95 million less than received in the prior fiscal year. The
year-over-year decline in projected receipts in this category is a
function of both statutory changes between the two years -- 1997 is the
first "surcharge free" taxable period in this decade --and a number of
essentially one-time transactions that increased receipts in the base
year, including unusually large audit receipts under the bank tax.
Other taxes include estate, gift and real estate transfer taxes, a tax on
gains from the sale or transfer to certain real estate (this tax was
repealed in 1996), a pari-mutuel tax and other minor levies. This is the
first fiscal year that real estate transfer tax receipts have been
diverted from the General Fund to the Clean Water/Clean Air Fund to
provide debt service coverage for general obligation bonds.
Total receipts from this category in the State's 1997-98 fiscal year are
projected to increase by $4 million from the 1996-97 level and total 1.09
billion for the fiscal year. This figure masks the significant increase
in estate tax collections during the first four months of the fiscal year
and results largely from the dedication of the proceeds of the real
estate transfer tax to meet debt service obligations on the new Clean
Water/Clean Air bond act and from the full-year impact of the repeal of
the real property gains tax.
Miscellaneous receipts include investment income, abandoned property
receipts, medical provider assessments, minor federal grants, receipts
from public authorities, and certain other license and fee revenues.
Transfers from other funds to the General Fund consist primarily of tax
revenues in excess of debt service requirements, particularly the one
percent sales tax used to support payments to LGAC. Miscellaneous
receipts and transfers from other funds are projected to reach $3.57
billion for the fiscal year.
General Fund Disbursements
General Fund disbursements and transfers to capital, debt service and
other funds are projected at $35.17 billion, an increase of $2.3 billion
(6.5 percent) from 1996-97 fiscal year levels. Over the last two years,
spending growth for most State agencies and programs has been negative or
flat, producing an overall decline in General Fund spending during that
period. The 1997-98 adopted budget reflects negotiated increases for
State employee salaries, increased transfers for debt service, and other
mandated increases, as well as increased investments in school aid,
higher education, mental health, and public protection. The Governor is
proposing legislation to use a portion of the current year surplus to
transfer $425 million to pay for capital projects authorized under the
Community Enhancement Facilities Assistance Program ("CEFAP") that were
previously planned to be financed with bond proceeds in 1998-99 and
thereafter, and $136 million in costs for an additional Medicaid payment
originally scheduled for 1998-99.
Grants to local governments is the largest category of General Fund
disbursements, and accounts for approximately 68 percent of overall
General Fund spending. Disbursements from this category are projected to
total $23.70 billion in the 1997-98 State Financial Plan, an increase
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of $820 million (3.6 percent) from 1996-97 levels. This includes $11.64
billion in aid for elementary, secondary, and higher education, accounting for
49 cents of every dollar spent in this category. On a school year basis,
school aid increases by $750 million, including formula-based elementary and
secondary education aid increases of $650 million.
General Fund payments for Medicaid are projected to be $5.34 billion, virtually
unchanged from the level of $5.38 billion in 1996-97, due primarily to
continuation of cost containment measures enacted in 1995-96 and 1996-97, new
reforms included in the 1997-98 adopted budget and forecasts for slower
underlying growth. Other social service spending is forecast to increase by only
$40 million or $3.08 billion in 1997-98. This slow growth stems from continued
State efforts to reduce welfare fraud, declining caseloads, and changes produced
by federal welfare legislation enacted in 1996.
Remaining disbursements primarily support community based mental hygiene
programs, community and public health programs, local transportation
programs, and revenue sharing payments to local governments. Revenue
sharing and other general purpose aid is projected at $802 million, an
increase of approximately $54 million from 1996-97.
State operations spending reflects the administrative costs of operating
the State's agencies, including the prison system, mental hygiene
institutions, the State University system ("SUNY"), the Legislature, and
the court system. Personal service costs account for approximately 71
percent of this category . Disbursements for State operations are
projected at $6.22 billion, an increase of $441 million or 7.6 percent
over 1996-97 fiscal year. About $200 million of this increase results
from approved collective bargaining agreements and the impact of binding
arbitration settlements. Other major increases include growth in SUNY
operations, increase mental hygiene costs resulting from increased
assessments on State-operated programs, public protection agency
spending, which is increasing to reflect the impact of sentencing reforms
and prison expansion, and higher spending by the Judiciary and
Legislature.
General State charges primarily reflect the costs of providing fringe
benefits for State employees, including contributions to pension systems,
the employer's share of social security contributions, employer
contributions toward the cost of health insurance, and the costs of
providing worker's compensation and unemployment insurance benefits. This
category also reflects certain fixed costs such as payments in lieu of
taxes, and payments of judgments against the State or its public
officers.
Disbursements in this category are projected to total $3 billion in the
1997-98 State Financial Plan. Pension costs are projected to grow
moderately year over year, while most of the projected growth in fixed
costs is related to increased payments to localities for State-owned
lands. These increases are fully offset by continued savings from health
care and worker's compensation reforms, which account for most of the
cost containment savings in this area.
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Debt service paid from the General Fund for 1997-98 reflects only the $11
million interest cost of the State's commercial paper program. This is
approximately the same level as last year, reflecting projections for
stable interest rates for the balance of the fiscal year. The State's
annual TRAN borrowing has been eliminated.
Transfers to other funds from the General Fund are made primarily to
finance certain portions of State capital project spending and debt
service on long-term bonds, where these costs are not funded from other
sources. Transfers to other funds for debt service are projected at $2.03
billion in 1997-98, an increase of $459 million. This reflects the
increased debt service impact of prior year bond sales, the
reclassification of City University ("CUNY") debt service costs that had
been previously included in grants to local governments, and the
inclusion of costs associated with the 1996-97 bonding of previous
pension liabilities at lower interest rates. This action has the effect
of adding $159 million in costs that would have otherwise been included
with general State charges. Transfers for capital projects provide
General Fund support for projects not otherwise financed through bond
proceeds, dedicated taxes and other revenues and federal grants. These
transfers are projected at $209 million for 1997-98, an increase of $71
million. The 1997-98 State Financial Plan also includes $299 million for
subsidies or transfers to other State funds, a decrease of $30 million
from last year's level.
General Fund Balance
The 1997-98 General Fund opening fund balance of $433 million includes
$317 million on deposit in the Tax Stabilization Reserve Fund ("TSRF"),
available for use in the event of an unanticipated General Fund deficit,
$41 million on deposit in the Contingency Reserve Fund ("CRF") available
for potential litigation costs against the State, and a $75 million
balance in the Community Projects Fund. The General Fund closing balance
is projected to be $465 million at the end of 1997-98, a decline of $462
million from the Mid-Year Update. The decline reflects the application of
the $530 million undersigned reserve plus additional surplus monies
projected in the January Update to pay for certain one-time costs in the
State's Financial Plan. The effect of this action is to help lower the
State's projected disbursements in 1998-98. The remaining General Fund
closing balance will be held in two funds, the TSRF and CRF. The TSRF is
projected to have $400 million on deposit at the close of the fiscal
year, following a required deposit of $15 million and an extraordinary
deposit of $68 million made from the 1997-98 surplus. The CRF is
projected to have a closing balance of $65 million, following an earlier
planned deposit of $24 million in 1997-98.
Special Revenue Funds
Special Revenue Funds are used to account for the proceeds of specific
revenue sources such as federal grants that are legally restricted,
either by the Legislature or outside parties, to expenditures for
specified purposes. Although activity in this fund type is expected to
comprise approximately 42 percent of total government funds receipts in
the 1997-98 fiscal year, three-quarters of that activity relates to
federally-funded programs. Projected Special
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Revenue Funds receipts total $28.22 billion, an increase of $2.51 billion (9.7
percent) over the prior year. Projected disbursements in this fund type total
$28.45 billion, an increase of $2.43 billion (9.3 percent) over 1996-97
levels. Disbursements from federal funds, primarily the federal share of
Medicaid and other social services programs, are projected to total $21.19
billion in the 1997-98 fiscal year. Remaining projected spending of $7.26
billion primarily reflects aid to SUNY supported by tuition and dormitory
fees, education aid funded from lottery receipts, operating aid payments to
the Metropolitan Transportation Authority funded from the proceeds of
dedicated transportation taxes, and costs of a variety of self-supporting
programs which deliver services financed by user fees.
Capital Project Funds
Capital Projects Funds account for the financial resources used for the
acquisition, construction, or rehabilitation of major State capital
facilities and for capital assistance grants to certain local governments
or public authorities. This fund type consists of the Capital Projects
Fund, which is supported by tax receipts transferred from the General
Fund, and various other capital funds established to distinguish specific
capital construction purposes supported by other revenues. In the 1997-98
fiscal year, activity in these funds is expected to comprise 5 percent of
total governmental receipts.
Total receipts in Capital Projects Funds are projected at $3.30 billion.
Bond and note proceeds are expected to provide $605 million in other
financing sources. Disbursements from this fund type are projected to be
$3.70 billion, an increase of $154 million (4.3 percent) over prior-year
levels. The Dedicated Highway and Bridge Trust Fund is the single largest
dedicated fund, comprising an estimated $982 million (27 percent) of the
activity in this fund type. Total spending for capital projects will be
financed through a combination of sources: federal grants (29 percent),
public authority bond proceeds (31 percent), general obligation bond
proceeds (15 percent), and pay-as-you-go revenues (25 percent).
Debt Service Funds
Debt Service Funds are used to account for the payment of principal of,
and interest on, long-term debt of the State and to meet commitments
under lease-purchase and other contractual-obligation financing
arrangements. This fund type is expected to comprise 4 percent of total
governmental fund receipts and 4.7 percent of total government
disbursements in the 1997-98 fiscal year. Receipts in these funds in
excess of debt service requirements may be transferred to the General
Fund and Special Revenue Funds, pursuant to law.
The Debt Service fund type consists of the General Debt Service Fund,
which is supported primarily by tax receipts transferred from the General
Fund, and other funds established to accumulate moneys for the payment of
debt service. In the 1997-98 fiscal year, total disbursements in Debt
Service Funds are projected at $3.17 billion, an increase of $641 million
or 25.3 percent, most of which is explained by increases in General Fund
transfers. The projected transfer from the General Fund of $2.03 billion
is expected to finance 65 percent of these payments.
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The remaining payments are expected to be financed by pledged revenues,
including $2.03 billion in taxes and $601 million in dedicated fees and
other miscellaneous receipts. After required impoundment for debt
service, $3.77 billion is expected to be transferred to the General Fund
and other funds in support of State operations. The largest transfer --
$1.86 billion -- is made to the Special Revenue fund type in support of
operations of the mental hygiene agencies. Another $1.47 billion in
excess sales taxes is expected to be transferred to the General Fund,
following payment of projected debt service on LGAC bonds.
Out- Year Projections of Receipts and Disbursements
Overview
The State closed projected budget gaps of $5.0 billion , $3.9 billion,
and $2.3 billion for the 1995-96 through 1997-98 fiscal years,
respectively. The 1998-99 budget gap was projected at $1.68 billion
(before the application of any assumed efficiencies) in the out-year
projections submitted to the Legislature in February 1997. As a result of
changes made in the adopted budget, the 1998-99 gap is now expected to be
about the same or smaller than the amount previously projected, after
application of the $530 million reserve for future needs. The expected
gap is smaller than the three previous budget gaps closed by the State.
The Governor has indicated that he will propose to close any potential
imbalance primarily through General Fund expenditure reductions and
without increases in taxes or deferrals of scheduled tax reductions. The
Executive Budget projects budget gaps of approximately $1.75 billion in
1999-2000, growing to $3.75 billion in 2000-01.
The receipt projections reflect constant law income tax liability growth
of approximately 5.3 percent annually and sales tax growth averaging
slightly less than 5 percent over the 1999-2001 period. Constant law
business tax liability is projected to rise slowly over the two years.
The revised expectations for the 1998-99 fiscal year reflect the loss of
$1.4 billion in surplus resources from 1996-97 operations that are being
utilized to finance current year spending, and an incremental effect of
approximately $300 million in legislated State and local tax reductions
in the out-years. Other factors include the annualized costs of certain
program increases in the 1997-98 adopted budget, most of which are
subject to annual appropriation.
Certain actions taken in the State's 1997-98 fiscal year, such as
Medicaid and welfare reforms, are expected to provide recurring savings
in future fiscal years. Continued controls on State agency spending will
also provide recurring savings. The availability of $530 million in
reserves created as a part of the 1997-98 adopted budget and included in
the Financial Plan is expected to benefit the 1998-99 fiscal year.
Sustained growth in the State's economy and continued declines in welfare
caseload and health care costs would also produce additional savings in
the 1998-99 Financial Plan. Finally, various federal actions, including
the potential beneficial effect on State tax receipts from changes to the
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federal tax treatment of capital gains, could potentially provide significant
benefits to the State over the next several years.
The Governor is required by law to propose a balanced budget each year.
In order to address any potential remaining budget gap, the Governor is
expected to make additional proposals to bring receipts in line with
disbursements.
Projected General Fund Receipts
The 1998-99 Financial Plan projects General Fund receipts (including
transfers from other funds) of $36.22 billion, an increase of $1.02
billion over the estimated 1997-98 level. Recurring growth in the State
General Fund tax base is projected to be approximately six percent during
1998-99, after adjusting for tax law and administrative changes. This
growth rate is lower than the rates for 1996-97 or currently estimated
for 1997-98, but roughly equivalent to the rate for 1995-96.
The forecast of General Fund receipts in 1998-99 incorporates several
Executive Budget tax proposals that, if enacted, would further reduce
receipts otherwise available to the General Fund by approximately $700
million during 1998-99. The Executive Budget proposes accelerating school
tax relief for senior citizens under the School Tax Assistance Program
("STAR"), which is projected to reduce General Fund receipts by $537
million in 1998-99. The proposed reduction supplements STAR tax
reductions already scheduled in law, which are projected at $187 million
in 1998-99. The Budget also proposes several new tax-cut initiatives and
other funding changes that are projected to further reduce receipts
available to the General Fund by over $200 million.
Personal income tax collections in the General Fund are projected to
increase by $1.32 billion over 1997-98, from $18.5 billion to $19.82
billion. In addition to the General Fund receipts, approximately $724
million in personal income tax collections will be deposited in special
revenue funds to finance STAR. User tax collections and fee receipts are
projected to reach $7.2 billion in 1998-99, an increase of $144 million
over the current year. Collections for corporation and utility taxes and
the petroleum business tax are projected to fall by $107 million from
1997-98. The decline in receipts in these categories is partially offset
by growth in the corporation franchise, insurance and bank taxes, which
are projected to grow by $88 million over the current fiscal year.
Receipts from other taxes, which include taxes on estate and gifts, real
property gains, and pari-mutuel wagering, are projected to total $1.01
billion in 1998-99, a decline of $78 million from the current year.
Miscellaneous receipts, which include license revenues, fee and fine
income, investment income and abandoned property proceeds, as well as the
yield of the largest share of the State's medical provider assessments,
are projected to fall from $1.57 billion in the current year to $1.4
billion in 1998-99, a decline of $170 million. LGAC transfers to the
General Fund are projected to increase by $72 million to $1.55 billion in
1998-99, consistent with estimates for sales and use receipts. All other
transfers are projected to decrease by $250 million to $270 million in
1998-99. These reflect nearly $200 million in nonrecurring federal
reimbursements that will be unavailable in 1998-99 and thereafter.
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Projected General Fund Disbursements
The 1998-99 Financial Plan projects General Fund disbursements of $36.18
billion, an increase of $1.02 billion over projected spending for the
current year. Disbursements in the category of Grants to Local
Governments are projected to increase by $931 million to $24.55 billion
in 1998-99, or 3.9 percent above 1997-98. School aid is projected at
$9.47 billion in 1998-99, an increase of $607 million on a State fiscal
year basis. Medicaid costs are estimated to increase $212 million to
$5.68 billion, about the same spending level as in 1994-95. Support for
State operations is projected to increase by $524 million to $6.73
billion, or 8.4 percent higher than 1997-98. Total spending in General
State charges is projected to decline slightly from 1997-98 to $2.23
billion. Transfers in support of debt service are projected to grow at
5.8 percent in 1998-99, from $2.03 billion to $2.15 billion. Transfers in
support of capital projects for 1998-99 are estimated to total $190
million, a decrease of $453 million from 1997-98. All other transfers
reflect remaining transfers from the General Fund to other funds. These
transfers decline by $68 million to $323 million in 1998-99.
Projected General Fund Closing Balance
The State projects a General Fund closing balance of $500 million for
1998-99. The TSRF is projected to have a balance of $400 million (the
same as 1997-98) and the CRF a balance of $100 million, following a
planned $35 million deposit to the CRF in 1998-99.
Projected Special Revenue Funds
For 1998-99, the Financial Plan projects disbursements of $30.16 billion
from Special Revenue Funds ("SRFs"), an increase of $2.32 billion or 8.3
percent over 1997-98. Disbursements in State SRFs are projected at $8.29
billion, an increase of $1.09 billion or 15.2 percent from 1997-98.
Disbursements from federal funds, which account for approximately
three-quarters of all SRF spending, are estimated at $21.87 billion in
1998-99, an increase of $1.22 billion or 5.9 percent from 1997-98.
Projected Capital Projects Funds
Disbursements from Capital Projects funds in 1998-99 are estimated at
$4.82 billion, or $1.07 billion higher than 1997-98. The proposed
spending plan includes: $2.51 billion in disbursements for transportation
purposes, including the State and local highway and bridge program; $815
million for environmental activities; $379 million for correctional
services; $228 million for SUNY and CUNY; $290 million for mental hygiene
projects; and $375 million for CEFAP.
Projected Debt Service Funds
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Disbursements from Debt Service Funds are estimated at $3.39 billion in
1998-99, an increase of $281 million in debt service costs projected for
1997-98. The increase in debt service is primarily attributable to bonds
previously issued in support of the following: $107 million for
transportation purposes in the State and local highway and bridge
programs financed by the Dedicated Highway and Bridge Trust Fund; $26
million for the mental hygiene programs financed through the Mental
Health Services Fund; $34 million for the environment; $37 million for
public protection purposes; and $43 million for CUNY senior and community
college debt service formerly classified as local assistance in the
General Fund. Debt service for LGAC bonds is projected at $345 million,
an increase of $15 million from 1997-98.
Projected Cash Flow
The projected 1998-99 General Fund cash flow will not depend on either
short-term spring borrowing or the issuance of LGAC bonds. The new-money
bond issuance portion of the LGAC program was completed in 1995-96, and
provisions prohibiting the State from returning to a reliance upon cash
flow manipulation to balance its budget will remain in bond covenants
until the LGAC bonds are retired.
The 1998-99 cash flow projects substantial closing balances in each
quarter of the fiscal year, with excesses in receipts over disbursements
in every quarter of the fiscal year and no monthly balance (prior to
March) lower than $1.5 billion. The closing fund balance is projected at
$500 million.
Prior Fiscal Years
New York State's financial operations have improved during recent fiscal
years. During the period 1989-90 through 1991-92, the State incurred
General Fund operating deficits that were closed with receipts from the
issuance of tax and revenue anticipation notes ("TRANs"). First, the
national recession, and then the lingering economic slowdown in the New
York and regional economy, resulted in repeated shortfalls in receipts
and three budget deficits. Through fiscal year 1995, the State recorded
balanced budgets on a cash basis, with substantial fund balances in each
year as described below.
1996-97 Fiscal Year
The State ended its 1996-97 fiscal year on March 31, 1997, in balance on
a cash basis, with a 1996-97 General Fund cash surplus of approximately
$1.4 billion. The cash surplus was derived primarily from
higher-than-expected revenues and lower-than-expected spending for social
services programs. Of the cash surplus amount, $1.05 billion was
previously budgeted by the Governor in his Executive Budget to finance
the 1997-98 Financial Plan, and the additional $373 million is available
for use in financing the 1997-98 State Financial Plan when enacted by the
State Legislature.
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Disbursements in Governmental Funds for the 1996-97 fiscal year totaled
$62.95 billion, $3 billion lower than projected at the beginning of the
fiscal year. Much of this variance was due to the uncertainty surrounding
federal action on entitlement spending at the beginning of the fiscal
year. Total unadjusted Governmental Funds spending decreased $278 million
or 0.4 percent below the 1995-96 fiscal year.
1995-96 Fiscal Year
The State ended its 1995-96 fiscal year on March 31, 1996, with a General
Fund cash surplus, as reported by DOB, of $445 million. Of that amount,
$65 million was deposited into the TSRF, and $380 million was used to
reduce 1996-97 Financial Plan liabilities.
The General Fund closing fund balance was $287 million, an increase of
$129 million from 1994-95 levels. The closing fund balance included $237
million on deposit in the TSRF. In addition, $41 million was on deposit
in the CRF. The remaining $9 million reflected amounts then on deposit in
the Revenue Accumulation Fund. The General Fund closing balance does not
include $678 million in the tax refund reserve account of which $521
million was made available as a result of the LGAC financing program and
was required to be on deposit as of March 31, 1996.
1994-95 Fiscal Year
The State ended its 1994-95 fiscal year with the General Fund in balance.
The closing fund balance of $158 million reflects $157 million in the
TSRF and $1 million in the CRF. The opening fund balance in State fiscal
year 1994-1995 was $265 million.
Compared to the State Financial Plan for 1994-95 as formulated on June
16, 1994, reported receipts fell short of original projections by $1.163
billion, primarily in the categories of personal income and business
taxes. Of this amount, the personal income tax accounts for $800 million.
Business taxes fell short by $373 million. These shortfalls were offset
by better performance in the remaining taxes, particularly the user taxes
and fees, which exceeded projections by $210 million. Of this amount,
$227 million was attributable to certain restatements for accounting
treatment purposes pertaining to the CRF and LGAC; these statements had
no impact on balance in the General Fund.
Certain Litigation
The legal proceedings noted below involve State finances, State programs
and miscellaneous tort, real property and contract claims in which the
State is a defendant and the monetary damages sought are substantial.
These proceedings could affect adversely the financial condition of the
State in the 1997-98 fiscal year or thereafter.
Among the more significant of these cases are those that involve: (i) the
validity of agreements and treaties by which various Indian tribes
transferred to New York title to certain land in New York; (ii) certain
aspects of New York's Medicaid rates and regulations, including
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reimbursements to providers of mandatory and optional Medicaid services,
and the eligibility for and nature of home care services; (iii)
challenges to provisions of Section 2807-C of the Public Health Law,
which impose a 13% surcharge on inpatient hospital bills paid by
commercial insurers and employee welfare benefit plans and portions of
Chapter 55 of the laws of 1992, which require hospitals to impose and
remit to the State an 11% surcharge on hospital bills paid by commercial
insurers and which require health maintenance organizations to remit to
the State a surcharge of up to 9%; (iv) alleged responsibility of New
York officials to assist in remedying racial segregation in the City of
Yonkers; (v) a plaintiff seeking reimbursement for certain Costs arising
out of the provision of preschool services and programs for children with
handicapping conditions; (vi) a case challenging the shelter allowance
granted to recipients of public assistance as insufficient for proper
housing; (vii) a challenge to the enactment of the Clean Water/Clean Air
Bond Act of 1996 and its implementing legislation; and (viii) a case
calling for the enforcement of the provisions of Articles 12-A, 20 and 28
as applicable to taxation on motor fuel and tobacco products sold to
non-Indian consumers on Indian reservations. In addition, aspects of
petroleum business taxes are the subject of administrative claims and
litigation.
The City of New York
The fiscal health of the State may be affected by the fiscal health of
New York City ("the City"), which continues to require significant
financial assistance from the State. The City depends on State aid both
to enable the City to balance its budget and to meet its cash
requirements. The State could also be affected by the ability of the City
to market its securities successfully in the public credit markets.
The City has achieved balanced operating results for each of its fiscal
years since 1981 as reported in accordance with the then-applicable GAAP
standards. The City's financial plans are usually prepared quarterly, and
the annual financial report for its most recent completed fiscal year is
prepared at the end of October of each year. For current information on
the City's four-year financial plan and its most recent financial
disclosure, contact the Office of the Comptroller, Municipal Building,
Room 517, One Centre Street, New York, NY 10007, Attention: Deputy
Comptroller, Finance.
In response to the City's fiscal crisis in 1975, the State took action to
assist the City in returning to fiscal stability. Among those actions,
the State established NYC MAC to provide financing assistance to the
City; the New York State Financial Control Board (the "Control Board") to
oversee the City's financial affairs; and the Office of the State Deputy
Comptroller for the City of New York ("OSDC") to assist the Control Board
in exercising its powers and responsibilities. A "Control Period" existed
from 1975 to 1986 during which the City was subject to certain
statutorily-prescribed fiscal controls. Although the Control Board
terminated the Control Period in 1986 when certain statutory conditions
were met and suspended certain Control Board powers, upon the occurrence
or "substantial likelihood and imminence" of the occurrence of certain
events, including (but not limited to) a City operating budget deficit of
more than $100 million or impaired access to the public credit markets,
the Control Board is required by law to reimpose a Control Period.
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Currently, the City and its Covered Organizations (i.e., those which
receive or may receive moneys from the City directly, indirectly or
contingently) operate under a four-year financial plan (the "Financial
Plan") which the City prepares annually and periodically updates. The
City's Financial Plan includes its capital, revenue and expense
projections and outlines proposed gap-closing programs for years with
projected budget gaps. The City's projections set forth in the Financial
Plan are based on various assumptions and contingencies, some of which
are uncertain and may not materialize. Unforeseen developments and
changes in major assumptions could significantly affect the City's
ability to balance its budget as required by State law and to meet its
annual cash flow and financing requirements.
Implementation of the Financial Plan is also dependent upon the ability
of the City and certain Covered Organizations to market their securities
successfully. The City issues securities to finance, refinance and
rehabilitate infrastructure and other capital needs, as well as for
seasonal financing needs.
Other Localities
Certain localities outside New York City have experienced financial
problems and have requested and received additional State assistance
during the last several State fiscal years. The potential impact on the
State of any future requests by localities for additional assistance is
not included in the projections of the State's receipts and disbursements
for the State's 1997-98 fiscal year.
Fiscal difficulties experienced by the City of Yonkers resulted in the
re-establishment of the Financial Control Board for the City of Yonkers
by the State in 1984. That Board is charged with oversight of the fiscal
affairs of Yonkers. Future actions taken by the State to assist Yonkers
could result in increased State expenditures for extraordinary local
assistance.
Beginning in 1990, the City of Troy experienced a series of budgetary
deficits that resulted in the establishment of a Supervisory Board for
the City of Troy in 1994. The Supervisory Board's powers were increased
in 1995, when Troy MAC was created to help Troy avoid default on certain
obligations. The legislation creating Troy MAC prohibits the City of Troy
from seeking federal bankruptcy protection while Troy MAC bonds are
outstanding. Troy MAC has issued bonds to effect a restructuring of the
City of Troy's obligations.
Eighteen municipalities received extraordinary assistance during the 1996
legislative session through $50 million in special appropriations
targeted for distressed cities, aid that was largely continued in 1997.
Municipalities and school districts have engaged in substantial
short-term and long-term borrowings. In 1994, the total indebtedness of
all localities in the State other than New York City was approximately
$19.0 billion. A small portion (approximately $102.3 million) of that
indebtedness represented borrowing to finance budgetary deficits and was
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issued pursuant to State enabling legislation. State law requires the
Comptroller to review and make recommendations concerning the budgets of those
local government units other than New York City authorized by State law to
issue debt to finance deficits during the period that such deficit financing
is outstanding. Eighteen localities had outstanding indebtedness for deficit
financing at the close of their fiscal year ending in 1995.
From time to time, federal expenditure reductions could reduce, or in
some cases eliminate, federal funding of some local programs and
accordingly might impose substantial increased expenditure requirements
on affected localities. If the State, the City or any of the public
authorities were to suffer serious financial difficulties jeopardizing
their respective access to the public credit markets, the marketability
of notes and bonds issued by localities within the State could be
adversely affected. Localities also face anticipated and potential
problems resulting from certain pending litigation, judicial decisions
and long-range economic trends. Long-range potential problems of
declining urban population, increasing expenditures and other economic
trends would adversely affect localities and require increasing State
assistance in the future.
Authorities
The fiscal stability of the State is related, in part, to the fiscal
stability of its public authorities. Public authorities are not subject
to the constitutional restrictions on the incurrence of debt which apply
to the State itself and may issue bonds and notes within the amounts, and
as otherwise restricted by, their legislative authorization. As of
September 30, 1996, there were 17 public authorities that had aggregate
outstanding debt of $100 million or more, and the aggregate outstanding
debt, including refunding bonds, of all State Public Authorities was
$75.4 billion, only a portion of which constitutes State-supported or
State-related debt. Some authorities also receive moneys from State
appropriations to pay for the operating costs of certain of their
programs.
The Metropolitan Transit Authority (the "MTA"), which receives the bulk
of the appropriated moneys from the State, oversees the operation of
subway and bus lines in New York City by its affiliates, the New York
City Transit Authority and Manhattan and Bronx Surface Transit Operating
Authority (collectively, the "TA"). The MTA operates certain commuter
rail and bus services in the New York Metropolitan area through MTA's
subsidiaries, the Long Island Rail Road Company, the Metro-North Commuter
Railroad Company, and the Metropolitan Suburban Bus Authority. In
addition, the Staten Island Rapid Transit Operating Authority, an MTA
subsidiary, operates a rapid transit line on Staten Island. Through its
affiliated agency, the Triborough Bridge and Tunnel Authority (the
"TBTA"), the MTA operates certain intrastate toll bridges and tunnels.
Because fare revenues are not sufficient to finance the mass transit
portion of these operations, the MTA has depended, and will continue to
depend, for operating support upon a system of State, local government
and TBTA support, and, to the extent available, federal operating
assistance, including loans, grants and subsidies. If current revenue
projections are not realized and/or operating expenses exceed current
projections, the TA or commuter railroads may be required to seek
additional State assistance, raise fares or take other actions.
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Since 1980, the State has enacted several taxes -- including a surcharge
on the profits of banks, insurance corporations and general business
corporations doing business in the 12-county Metropolitan Transportation
Region served by the MTA and a special one-quarter of 1 percent regional
sales and use tax -- that provide revenue for mass transit purposes,
including assistance to the MTA. Since 1987 State law has required that
the proceeds of a one-quarter of 1 percent mortgage recording tax paid on
certain mortgages in the Metropolitan Transportation Region be deposited
in a special MTA fund for operating or capital expenses. In 1993, the
State dedicated a portion of certain additional State petroleum business
tax receipts to fund operating or capital assistance to the MTA. For the
1997- 98 State fiscal year, total State assistance to the MTA is
estimated at approximately $1.09 billion, an increase of $76 million over
the 1996-97 fiscal year.
State legislation accompanying the 1996-97 adopted State budget
authorized the MTA, TBTA and TA to issue an aggregate of $6.5 billion in
bonds to finance a portion of a new $12.17 billion MTA capital plan for
the 1995 through 1999 calendar years (the "1995-99 Capital Program"). In
July 1997, the Capital Program Review Board ("CPRB") approved the 1995-99
Capital Program , which supersedes the overlapping portion of the MTA's
1992-96 Capital Program. This is the fourth capital plan since the
Legislature authorized procedures for the adoption, approval and
amendment of MTA capital programs and is designed to upgrade the
performance of the MTA's transportation systems by investing in new
rolling stock, maintaining replacement schedules for existing assets and
bringing the MTA system into a state of good repair. The 1995-99 Capital
Program assumes the issuance of an estimated $5.1 billion in bonds under
this $6.5 billion aggregate bonding authority. The remainder of the plan
is projected to be financed through assistance from the State, the
federal government, and the City of New York, and from various other
revenues generated from actions taken by the MTA.
There can be no assurance that all the necessary governmental actions for
the 1995-99 Capital Program or future capital programs will be taken,
that funding sources currently identified will not be decreased or
eliminated, or that the 1995-99 Capital Program, or parts thereof, will
not be delayed or reduced. Should funding levels fall below current
projections, the MTA would have to revise its 1995-99 Capital Program
accordingly. If the 1995-99 Capital Program is delayed or reduced
ridership and fare revenues may decline, which could, among other things,
impair the MTA's ability to meet its operating expenses without
additional assistance.
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ADDITIONAL INFORMATION
As used in this Statement of Additional Information and the Prospectuses,
the term "majority of a Fund's outstanding shares" (of a series, if
applicable) means the vote of (i) 67% or more of the Fund's shares (of
the series, if applicable) present at a meeting, if the holders of more
than 50% of the Fund's outstanding shares (of the series, if applicable)
are present or represented by proxy, or (ii) more than 50% of the Fund's
outstanding shares (of the series, if applicable), whichever is less.
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Telephone calls to the Funds and The Bank of New York as shareholder
servicing agent may be tape recorded.
With respect to the securities offered hereby, this Statement of
Additional Information and the Prospectuses do not contain all the
information included in the Funds' Registration Statement filed with the
Securities and Exchange Commission under the Securities Act. Pursuant to
the rules and regulations of the Securities and Exchange Commission,
certain portions have been omitted. The Registration Statement, including
the exhibits filed therewith, may be examined at the office of the
Securities and Exchange Commission in Washington, D.C.
Statements contained in this Statement of Additional Information and the
Prospectuses concerning the contents of any contract or other document
are not necessarily complete, and in each instance, reference is made to
the copy of such contract or other document filed as an exhibit to the
Registration Statements. Each such statement is qualified in all respects
by such reference.
No dealer, salesman or any other person has been authorized to give any
information or to make any representations, other than those contained in
the Prospectuses and this Statement of Additional Information, in
connection with the offer contained in the Prospectuses and this
Statement of Additional Information and, if given or made, such other
information or representations must not be relied upon as having been
authorized by any of the Funds or the Distributor. The Prospectuses and
this Statement of Additional Information do not constitute an offer by
any Fund or by the Distributor to sell or solicitation of any offer to
buy any of the securities offered hereby in any jurisdiction to any
person to whom it is unlawful for the Funds or the Distributor to make
such offer in such jurisdictions.
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FINANCIAL STATEMENTS
The following financial information is hereby incorporated by reference
to the indicated pages of the Funds' Annual Report to shareholders dated
December 31, 1997.
<TABLE>
<S> <C> <C> <C> <C> <C>
QUESTIONS & ANSWERS Page 1 BNY HAMILTON INTERMEDIATE
INVESTMENT GRADE FUND
BNY HAMILTON EQUITY INCOME FUND Schedule of Investments....... Page 57
Schedule of Investments....... 21 Statement of Assets and
Liabilities................... 61
Statement of Assets and Statement of Operations....... 61
Liabilities................... 26
Statement of Operations....... 26 Statement of Changes in Net
Assets........................ 62
Statements of Changes in Net Financial Highlights.......... 63
Assets........................ 27
Financial Highlights.......... 28
BNY HAMILTON INTERMEDIATE NEW
BNY HAMILTON LARGE CAP GROWTH YORK TAX-EXEMPT FUND
FUND Schedule of Investments....... 64
Schedule of Investments....... 29 Statement of Assets and
Liabilities................... 69
Statement of Assets and Statement of Operations....... 69
Liabilities................... 32
Statement of Operations....... 32 Statements of Changes in Net
Assets........................ 70
Statement of Changes in Net Assets 33 Financial Highlights.......... 71
Financial Highlights.......... 34
BNY HAMILTON INTERMEDIATE TAX-
BNY HAMILTON SMALL CAP GROWTH EXEMPT FUND
FUND Schedule of Investments....... 72
</TABLE>
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<TABLE>
<S> <C> <C> <C>
Schedule of Investments....... 35 Diversification by State...... 81
Statement of Assets and Statement of Assets and
Liabilities................... 38 Liabilities................... 82
Statement of Operations....... 38 Statement of Operations....... 82
Statement of Changes in Net Assets 39 Statement of Changes in Net
Assets........................ 83
Financial Highlights.......... 40 Financial Highlights.......... 84
BNY HAMILTON INTERNATIONAL EQUITY BNY HAMILTON MONEY FUND
FUND Schedule of Investments....... 85
Schedule of Investments....... 41 Statement of Assets and
Liabilities................... 94
Industry Diversification...... 46 Statement of Operations....... 94
Statement of Assets and Statements of Changes in Net
Liabilities................... 47 Assets........................ 95
Statement of Operations....... 47 Financial Highlights.......... 96
Statement of Changes in Net Assets 48
Financial Highlights.......... 49 BNY HAMILTON TREASURY MONEY
FUND
BNY HAMILTON INTERMEDIATE Schedule of Investments....... 99
GOVERNMENT FUND Statement of Assets and
Liabilities................... 101
Schedule of Investments....... 50 Statement of Operations....... 101
Statement of Assets and Statement of Changes in Net
Liabilities................... 54 Assets........................ 102
Statement of Operations....... 54 Financial Highlights.......... 103
Statements of Changes in Net
Assets........................ 55
Financial Highlights.......... 56 NOTES TO FINANCIAL STATEMENTS.... 104
REPORT OF INDEPENDENT AUDITORS... 113
FEDERAL INCOME TAX INFORMATION... 114
DIRECTORS AND OFFICERS........... 116
</TABLE>
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APPENDIX A
Description of Security Ratings
S&P
Corporate and Municipal Bonds
AAA Debt obligations rated AAA have the highest ratings assigned
by S&P to a debt obligation. Capacity to pay interest and
repay principal is extremely strong.
AA Debt obligations rated AA have a very strong capacity to pay
interest and repay principal and differ from the highest
rated issues only in a small degree.
A Debt obligations rated A have a strong capacity to pay
interest and repay principal although they are somewhat more
susceptible to the adverse effects of changes in
circumstances and economic conditions than debts in higher
rated categories.
BBB Debt obligations rated BBB are regarded as having an
adequate capacity to pay interest and repay principal.
Whereas they normally exhibit 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 debts in this
category than for debts in higher rated categories.
BB Debt rated BB has less near-term vulnerability to default
than other speculative issues. However, it faces major
ongoing uncertainties or exposure to adverse business,
financial, or economic conditions which could lead to
inadequate capacity to meet timely interest and principal
payments.
B Debt rated B has greater vulnerability to default but
currently has the capacity to meet interest payments and
principal repayments. Adverse business, financial, or
economic conditions will likely impair capacity or
willingness to pay interest and repay principal.
CCC Debt rated CCC has a currently indefinable vulnerability to
default, and is dependent upon favorable business, financial
and economic conditions to meet timely payment of interest
and repayment of principal. In the event of adverse
business, financial or economic conditions, it is not likely
to have the capacity to pay interest and repay principal.
CC The rating CC is typically applied to debt subordinated to
senior debt that is assigned an actual or implied CCC rating.
C The rating C is typically applied to debt subordinated to
senior debt which is assigned an actual or implied CCC-debt
rating.
86
<PAGE>
NR No public rating has been requested, there may be
insufficient information on which to base a rating, or that
S&P does not rate a particular type of obligation as a
matter of policy.
Commercial Paper, Including Tax-Exempt Commercial Paper
A Issues assigned this highest rating are regarded as having
the greatest capacity for timely payment. Issues in this
category are further refined with the designations 1, 2, and
3 to indicate the relative degree of safety.
A-1 This designation indicates that the degree of safety regarding
timely payment is very strong.
MOODY'S
Corporate and Municipal Bonds
Aaa Bonds that are rated Aaa 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 by 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.
Aa Bonds that are rated Aa are judged to be of high quality by
all standards. Together with the Aaa group 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.
A Bonds that 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.
Baa Bonds that are rated Baa are considered as 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.
87
<PAGE>
Ba Bonds which are rated Ba are judged to have speculative
elements; their future cannot be considered as well assured.
Uncertainty of position characterizes bonds in this class.
B 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.
Caa Bonds which are rated Caa are of poor standing. Such issues
may be in default or there may be presented elements of
danger with respect to principal or interest.
Ca 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.
C Bonds which are rated C are the lowest rated class of bonds
and issue so rated can be regarded as having extremely poor
prospects of ever attaining any real investment standing.
NR No public rating has been requested, there may be
insufficient information on which to base a rating, or that
Moody's does not rate a particular type of obligation as a
matter of policy.
Commercial Paper, Including Tax-Exempt Commercial Paper
Prime-1 Issuers rated Prime-1 (or related supporting institutions)
have a superior capacity for repayment of short-term
promissory obligations. Prime-1 repayment capacity will
normally be evidenced by the following characteristics:
- Leading market positions in well established industries.
- High rates of return on funds employed.
- Conservative capitalization structures with moderate
reliance on debt and ample asset protection.
- Broad margins in earnings coverage of fixed
financial charges and high internal cash generation.
- Well established access to a range of financial
markets and assured sources of alternate liquidity.
Short-Term Tax-Exempt Notes
MIG-1 The short-term tax-exempt note rating MIG-1 is the highest
rating assigned by Moody's for notes judged to be the best
quality. Notes with this rating enjoy strong protection from
established cash flows of funds for their servicing or from
established and broad-based access to the market for
refinancing, or both.
88
<PAGE>
MIG-2 MIG-2 rated notes are of high quality but with margins of
protection not as large as MIG-1.
89
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits.
(a) Financial Statements:
The Financial Statements filed as part of this Registration
Statement are as follows:
Audited Financial Statements of BNY Hamilton Equity Income
Fund, BNY Hamilton Large Cap Growth Fund, BNY Hamilton Small
Cap Growth Fund, BNY Hamilton International Equity Fund, BNY
Hamilton Intermediate Government Fund, BNY Hamilton
Intermediate Investment Grade Fund, BNY Hamilton
Intermediate New York Tax-Exempt Fund, BNY Hamilton
Intermediate Tax-Exempt Fund, BNY Hamilton Money Fund and
BNY Hamilton Treasury Money Fund as of December 31, 1997
- Schedule of Investments
- Statement of Assets and Liabilities
- Statement of Operations
- Statements of Changes in Net Assets
- Financial Highlights
- Notes to Financial Statements
- Report of Independent Auditors
(b) Exhibits:
<TABLE>
<CAPTION>
Exhibit Number Description
<S> <C> <C> <C>
(1) (a) Articles of Incorporation of Registrant.*
(b) Articles of Amendment, dated June 29, 1992.*
(c) Articles of Supplementary, dated June 29, 1994.*
(d) Articles of Supplementary, dated August 15, 1995.*
(e) Articles of Amendment, dated January 22, 1997*
(f) Articles Supplementary, dated January 22, 1997.*
(2) Bylaws of Registrant.*
(3) Not Applicable.
(4) (a) Form of Specimen stock certificate of common stock of BNY Hamilton Money
Fund.*
(b) Form of Specimen stock certificate of common stock of BNY Hamilton
Intermediate Government Fund.*
(c) Form of specimen stock certificate of common stock of BNY Hamilton
Intermediate New York Tax-Exempt Fund.*
(d) Form of specimen stock certificate of common stock of BNY Hamilton Equity
Income Fund.*
(5) (a) Investment Advisory Agreement between BNY Hamilton Money Fund and The Bank
of New York.*
(b) Investment Advisory Agreement between BNY Hamilton Intermediate Government
Fund and The Bank of New York.*
(c) Investment Advisory Agreement between BNY Hamilton Intermediate New York
Tax-Exempt Fund and The Bank of New York.*
(d) Investment Advisory Agreement between BNY Hamilton Equity Income Fund and
The Bank of New York.*
(e) Investment Advisory Agreement between BNY Hamilton Treasury Money Fund and
The Bank of New York.*
(f) Investment Advisory Agreement between BNY Hamilton Large Cap Growth Fund
and The Bank of New York.*
(g) Investment Advisory Agreement between BNY Hamilton Small Cap Growth Fund
and The Bank of New York.*
(h) Investment Advisory Agreement between BNY Hamilton International Equity
Fund and The Bank of New York.*
(i) Investment Advisory Agreement between BNY Hamilton Intermediate Investment
Grade Fund and The Bank of New York.*
(j) Investment Advisory Agreement between BNY Hamilton Intermediate Tax-Exempt
Fund and The Bank of New York.*
(k) Sub-advisory agreement between BNY Hamilton International Equity Fund and
Indosuez Asset Management.*
(6) (a) Distribution Agreements between Registrant and BNY Hamilton Distributors,
Inc.*
(b) Supplement to Distribution Agreements between Registrant and BNY Hamilton
Distributors, Inc.*
(7) Not Applicable.
(8) (a) Custody Agreement between Registrant and The Bank of New York.*
(b) Cash Management and Related Services Agreement between each series of Registrant
and The Bank of New York.*
(c) Supplement to Custody Agreement between Registrant and The Bank of New
York.*
(d) Supplement to Cash Management and Related Services Agreement between
Registrant and The Bank of New York.*
(9) (a) Administration Agreement between Registrant and BNY Hamilton Distributors,
Inc.*
(b) Fund Accounting Services Agreement between Registrant and The Bank of
New York.*
(c) Form of Transfer Agency Agreement between Registrant and BISYS Fund
Services, Inc.*
(d) Form of Shareholder Servicing Agreement.*
(e) Form of Sub-Administration Agreement between BNY Hamilton Distributors,
Inc. and The Bank of New York.*
(f) Shareholder Servicing Plan of BNY Hamilton Money Fund (Hamilton Premier
Shares).*
(g) No longer applicable.
(h) Shareholder Servicing Plan of BNY Hamilton Money Fund (Hamilton Classic
Shares).*
(i) Rule 18f-3 Plan of BNY Hamilton Money Fund.*
(j) Supplement to Administration Agreement between Registrant and BNY Hamilton
Distributors, Inc.*
(k) Supplement to Fund Accounting Services Agreement between Registrant and
The Bank of New York.*
(l) Updated Transfer Agency Agreement between Registrant and BISYS Fund Services, Inc.*
(m) Shareholder Servicing Plan of BNY Hamilton Treasury Money Fund (Hamilton
Premier Shares).*
(n) Revised Rule 18f-3 Plan of BNY Hamilton Funds, Inc.*
(o) Supplement to Form of Sub-Administration Agreement between BNY Hamilton
Distributors, Inc. and The Bank of New York.*
(p) Revised Fund Accounting Services Agreement between BNY Hamilton
International Equity Fund and The Bank of New York.
(10) Opinion of Sullivan & Cromwell.*
(11) Consent of KPMG Peat Marwick LLP.
(12) Not Applicable.
(13) Form of Seed Capital Agreement between Registrant and BNY Hamilton
Distributors, Inc.*
(14) Not Applicable.
(15) (a) Rule 12b-1 Plan of BNY Hamilton Intermediate Government Fund.*
(b) Rule 12b-1 Plan of BNY Hamilton Intermediate New York Tax-Exempt Fund.*
(c) Rule 12b-1 Plan of BNY Hamilton Equity Income Fund.*
(d) Rule 12b-1 Plan of BNY Hamilton Money Fund - Hamilton Classic Shares.*
(e) Rule 12b-1 Plan of BNY Hamilton Large Cap Growth Fund - Investor Shares.*
(f) Rule 12b-1 Plan of BNY Hamilton Small Cap Growth Fund - Investor Shares.*
(g) Rule 12b-1 Plan of BNY Hamilton International Equity Fund - Investor
Shares.*
(h) Rule 12b-1 Plan of BNY Hamilton Intermediate Investment Grade Fund -
Investor Shares.*
(i) Rule 12b-1 Plan of BNY Hamilton Intermediate Tax-Exempt Fund - Investor
Shares.*
(16) Schedule for computation of performance quotations.
(17) Financial Data Schedule.
</TABLE>
- ------------------------------
* Previously filed.
Item 25. Persons Controlled by or under Common Control with Registrant.
No person is controlled by or under common control with the
Registrant.
Item 26. Number of Record Holders of Securities as of March 31, 1998.
<TABLE>
<CAPTION>
Number
Title of Class of record holders
-------------- -----------------
<S> <C>
Equity Income Fund - Institutional Shares 3,206
Equity Income Fund - Investor Shares 1,470
Large Cap Growth Fund - Institutional Shares 2,469
Large Cap Growth Fund - Investor Shares 120
Small Cap Growth Fund - Institutional Shares 1,840
Small Cap Growth Fund - Investor Shares 124
International Equity Fund - Institutional Shares 1,707
International Equity Fund - Investor Shares 103
Intermediate Government Fund - Institutional Shares 352
Intermediate Government Fund - Investor Shares 363
Intermediate Investment Grade Fund - Institutional Shares 2,606
Intermediate Investment Grade Fund - Investor Shares 12
Intermediate New York Tax-Exempt Fund - Institutional Shares 226
Intermediate New York Tax-Exempt Fund - Investor Shares 394
Intermediate Tax-Exempt Fund - Institutional Shares 1,287
Intermediate Tax-Exempt Fund - Investor Shares 7
Money Fund - Hamilton Shares 77
Money Fund - Hamilton Premier Shares 2,357
Money Fund - Hamilton Classic Shares 533
Treasury Money Fund - Hamilton Shares 26
Treasury Money Fund - Hamilton Premier Shares 350
</TABLE>
Item 27. Indemnification.
Reference is made to Article VI of Registrant's Bylaws and the
Distribution Agreement each filed as exhibits hereto.
Registrant, its Directors and officers, the other investment
companies administered by the Administrator, and persons affiliated
with them are insured against certain expenses in connection with
the defense of actions, suits, or proceedings, and certain
liabilities that might be imposed as a result of such actions,
suits or proceedings.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to Directors, officers and
controlling persons of the Registrant and the principal underwriter
pursuant to the foregoing provisions or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by
a Director, officer, or controlling person of the Registrant and
the principal underwriter in connection with the successful defense
of any action, suit or proceeding) is asserted against the
Registrant by such Director, officers or controlling person or
principal underwriter in connection with the shares being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
Item 28. Business and Other Connections of Investment Adviser.
The Registrant's investment adviser, The Bank of New York, is a New
York trust company. The Bank of New York conducts a general banking
and trust business. The Bank of New York is not affiliated with BNY
Hamilton Distributors, Inc.
To the knowledge of the Registrant, none of the directors or
officers of The Bank of New York, except those set forth below, is
engaged in any other business, profession, vocation or employment
of a substantial nature. Set forth below are the names and
principal businesses of each director of The Bank of New York who
is engaged in another business, profession, vocation or employment
of a substantial nature:
<TABLE>
<CAPTION>
Name Title/Company
---- -------------
<S> <C>
Richard Barth..................................... Retired; Formerly Chairman and Chief Executive
Officer of Ciba-Geigy Corporation (diversified
chemical products)
Frank J. Biondi, Jr............................... Chairman and Chief Executive Office of Universal
Studios (diversified entertainment operator)
Harold E. Sells................................... Retired; Formerly Chairman and Chief Executive
Office of Woolworth Corporation (retailing)
William R. Chaney................................. Chairman and Chief Executive Officer of Tiffany &
Co., (international designers, manufacturers and
distributors of jewelry and fine goods)
Ralph E. Gomory................................... President of Alfred P. Sloan Foundation, Inc.
(private foundation)
Richard J. Kogan.................................. President and Chief Executive Officer of
Schering-Plough Corporation (manufacturer of
pharmaceutical and consumer products)
John A. Luke, Jr.................................. Chairman, President and Chief Executive Officer of
Westvaco Corporation (manufacturer of paper,
packaging, and specialty chemicals)
John C. Malone.................................... President and Chief Executive Officer of
Tele-Communications, Inc., (cable television
multiple system operator)
Donald L. Miller.................................. Chief Executive Officer and Publisher of Our World
News, LLC (media)
H. Barclay Morley............................... Retired; Formerly Chairman and Chief Executive
Officer of Stauffer Chemical Company (chemicals)
Catherine A. Rein................................. Senior Executive Vice President of Metropolitan
Life Insurance Company (insurance and financial
services)
</TABLE>
Item 29. Principal Underwriter.
(a) BNY Hamilton Distributors, Inc., which is located at 125
West 55th Street, New York, New York 10019, will act as
exclusive distributor for the Registrant. The distributor is
registered with the Securities and Exchange Commission as a
broker-dealer and is a member of the National Association of
Securities Dealers.
(b) The information required by this Item 29 with respect to
each director, officer or partner of the Distributor is
incorporated by reference to Schedule A of Form BD filed by
the Distributor pursuant to the Securities Exchange Act of
1934.
(c) Not Applicable.
Item 30. Location of Accounts and Records.
All accounts, books and other documents required to be maintained
by Section 31(a) of the Investment Company Act of 1940 and the
Rules thereunder will be maintained at the offices of BISYS Fund
Services, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-3035.
Item 31. Management Services.
Not Applicable.
Item 32. Undertakings.
The Registrant undertakes that, if requested to do so by 10% of its
outstanding shares, the Registrant will promptly call a meeting of
shareholders for the purpose of voting on the removal of a director
or directors and Registrant will assist with shareholder
communications as required by Section 16(c) of the Investment
Company Act of 1940.
The Registrant hereby also undertakes that so long as the
information required by Item 5A of Form N-1A is contained in the
latest annual report to shareholders and not in the prospectuses of
each Fund (other than BNY Hamilton Money Fund and BNY Hamilton
Treasury Money Fund), the Registrant will furnish each person to
whom a prospectus is delivered with a copy of the Registrant's
latest annual report to shareholders, upon request and without
charge.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the registrant certifies that it meets all of the
requirements for effectiveness of this registration statement pursuant to Rule
485(b) under the Securities Act of 1933 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereto
duly authorized in the City of New York, and the State of New York on the
27th day of April, 1998.
BNY HAMILTON FUNDS, INC.
By /s/ William J. Tomko
----------------------------------
William J. Tomko
President
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed below by the following persons in the capacities
indicated on the 27th day of April, 1998.
Name Title
/s/ Edward L. Gardner Director and Chairman of
-------------------------------- the Board of Directors
(Edward L. Gardner)
/s/ Peter Herrick Director
--------------------------------
(Peter Herrick)
/s/ Leif H. Olsen Director
--------------------------------
(Leif H. Olsen)
/s/ Stephen Stamas Director
--------------------------------
(Stephen Stamas)
/s/ James E. Quinn Director
--------------------------------
(James E. Quinn)
/s/ J. David Huber Chief Executive Officer
--------------------------------
(J. David Huber)
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit Number Description Page
<S> <C> <C> <C> <C>
(1) (a) Articles of Incorporation of Registrant.*
(b) Articles of Amendment, dated June 29, 1992.*
(c) Articles of Supplementary, dated June 29, 1994.*
(d) Articles of Supplementary, dated August 15, 1995.*
(e) Articles of Amendment, dated January 22, 1997*
(f) Articles Supplementary, dated January 22, 1997.*
(2) Bylaws of Registrant.*
(3) Not Applicable.
(4) (a) Form of Specimen stock certificate of common stock of BNY Hamilton Money Fund.*
(b) Form of Specimen stock certificate of common stock of BNY Hamilton Intermediate Government Fund.*
(c) Form of specimen stock certificate of common stock of BNY Hamilton Intermediate New York Tax-Exempt Fund.*
(d) Form of specimen stock certificate of common stock of BNY Hamilton Equity Income Fund.*
(5) (a) Investment Advisory Agreement between BNY Hamilton Money Fund and The Bank of New York.*
(b) Investment Advisory Agreement between BNY Hamilton Intermediate Government Fund and The Bank of New
York.*
(c) Investment Advisory Agreement between BNY Hamilton Intermediate New York Tax-Exempt Fund and The
Bank of New York.*
(d) Investment Advisory Agreement between BNY Hamilton Equity Income Fund and The Bank of New York.*
(e) Investment Advisory Agreement between BNY Hamilton Treasury Money Fund and The Bank of New York.*
(f) Investment Advisory Agreement between BNY Hamilton Large Cap Growth Fund and The Bank of New York.*
(g) Investment Advisory Agreement between BNY Hamilton Small Cap Growth Fund and The Bank of New York.*
(h) Investment Advisory Agreement between BNY Hamilton International Equity Fund and The Bank of New
York.*
(i) Investment Advisory Agreement between BNY Hamilton Intermediate Investment Grade Fund and The Bank
of New York.*
(j) Investment Advisory Agreement between BNY Hamilton Intermediate Tax-Exempt Fund and The Bank of New
York.*
(k) Sub-advisory agreement between BNY Hamilton International Equity Fund and Indosuez Asset
Management.*
(6) (a) Distribution Agreements between Registrant and BNY Hamilton Distributors, Inc.*
(b) Supplement to Distribution Agreements between Registrant and BNY Hamilton Distributors, Inc.*
(7) Not Applicable.
(8) (a) Custody Agreement between Registrant and The Bank of New York.*
(b) Cash Management and Related Services Agreement between each series of Registrant and The Bank of New
York.*
(c) Supplement to Custody Agreement between Registrant and The Bank of New York.*
(d) Supplement to Cash Management and Related Services Agreement between Registrant and The Bank of New York.*
(9) (a) Administration Agreement between Registrant and BNY Hamilton Distributors, Inc.*
(b) Fund Accounting Services Agreement between Registrant and The Bank of New York.*
(c) Form of Transfer Agency Agreement between Registrant and BISYS Fund Services, Inc.*
(d) Form of Shareholder Servicing Agreement.*
(e) Form of Sub-Administration Agreement between BNY Hamilton Distributors, Inc. and The Bank of New
York.*
(f) Shareholder Servicing Plan of BNY Hamilton Money Fund (Hamilton Premier Shares).*
(g) No longer applicable.
(h) Shareholder Servicing Plan of BNY Hamilton Money Fund (Hamilton Classic Shares).*
(i) Rule 18f-3 Plan of BNY Hamilton Money Fund.*
(j) Supplement to Administration Agreement between Registrant and BNY Hamilton Distributors, Inc.*
(k) Supplement to Fund Accounting Services Agreement between Registrant and The Bank of New York.*
(l) Updated Transfer Agency Agreement between Registrant and BISYS Fund Services, Inc.*
(m) Shareholder Servicing Plan of BNY Hamilton Treasury Money Fund (Hamilton Premier Shares).*
(n) Revised Rule 18f-3 Plan of BNY Hamilton Funds, Inc.*
(o) Supplement to Form of Sub-Administration Agreement between BNY Hamilton Distributors, Inc. and
The Bank of New York.*
(p) Revised Fund Accounting Services Agreement between BNY Hamilton International Equity Fund and The Bank
of New York.
(10) Opinion of Sullivan & Cromwell.*
(11) Consent of KPMG Peat Marwick LLP.
(12) Not Applicable.
(13) Form of Seed Capital Agreement between Registrant and BNY Hamilton Distributors, Inc.*
(14) Not Applicable.
(15) (a) Rule 12b-1 Plan of BNY Hamilton Intermediate Government Fund.*
(b) Rule 12b-1 Plan of BNY Hamilton Intermediate New York Tax-Exempt Fund.*
(c) Rule 12b-1 Plan of BNY Hamilton Equity Income Fund.*
(d) Rule 12b-1 Plan of BNY Hamilton Money Fund - Hamilton Classic Shares.*
(e) Rule 12b-1 Plan of BNY Hamilton Large Cap Growth Fund - Investor Shares.*
(f) Rule 12b-1 Plan of BNY Hamilton Small Cap Growth Fund - Investor Shares.*
(g) Rule 12b-1 Plan of BNY Hamilton International Equity Fund - Investor Shares.*
(h) Rule 12b-1 Plan of BNY Hamilton Intermediate Investment Grade Fund - Investor Shares.*
(i) Rule 12b-1 Plan of BNY Hamilton Intermediate Tax-Exempt Fund - Investor Shares.*
(16) Schedule for computation of performance quotations.
(17) Financial Data Schedule.
</TABLE>
- ------------------------------
* Previously filed.
<PAGE>
(9p) Revised Fund Accounting Services Agreement
between
BNY Hamilton International Equity Fund and The Bank of New York
<PAGE>
[Letterhead of The Bank of New York]
PORTFOLIO PRICING AND FUND ACCOUNTING FEE SCHEDULE
FOR
BNY INTERNATIONAL EQUITY FUND
MINIMUM FEES
- ------------
$6,500 per month, per Fund.
MULTIPLE CLASS CHARGES
- ----------------------
$500 per month, per Fund, for each additional class added in excess of three (3)
classes.
OUT-OF-POCKET EXPENSES
- ----------------------
These expenses are billed as they are incurred with no markup. Expenses
traditionally include, but are not limited to, the costs of obtaining prices for
security evaluations and mark to market, costs associated with attendance at
Board Presentations, Postage, Express Mail charges, etc.
BNY Hamilton Funds The Bank of New York
Approved by: /s/ William J. Tomko Approved by: /s/ Daniel J. Maniello
------------------------- -------------------------
William J. Tomko Daniel J. Maniello
President, BNY Vice President
Hamilton Funds
Date: 4/16/97 Date: 3/31/97
--------- ---------
<PAGE>
(11) Consent of KPMG Peat Marwick LLP
<PAGE>
Independent Auditors' Consent
-------------------------------
To the Shareholders and Board of Directors of the
BNY Hamilton Funds, Inc.:
We consent to the use of our report dated February 13, 1998 with respect to the
BNY Hamilton Funds, Inc. (including the BNY Hamilton Equity Income Fund, BNY
Hamilton Large Cap Growth Fund, BNY Hamilton Small Cap Growth Fund, BNY
Hamilton International Equity Fund, BNY Hamilton Intermediate Government Fund,
BNY Hamilton Intermediate Investment Grade Fund, BNY Hamilton Intermediate New
York Tax-Exempt Fund, BNY Hamilton Intermediate Tax-Exempt Fund, BNY Hamilton
Money Fund, and the BNY Hamilton Treasury Money Fund), incorporated herein by
reference and to the references of our Firm under the headings "Financial
Highlights" in each of the Funds' Prospectuses.
/S/ KPMG Peat Marwick LLP
New York, New York (KPMG Peat Marwick LLP)
April 27, 1998
<PAGE>
(11) Consent of Deloitte & Touche
CONSENT OF INDEPENDENT AUDITORS
We consent to the use in Post-Effective Amendment No. 11 to Registration
Statement No. 33-47703 of BNY Hamilton Fund, Inc. to the references to us under
the headings "Financial Highlights" in the Prospectuses, which are included in
such Registration Statement.
/s/ Deloitte & Touche LLP
New York, New York
April 29, 1998
<PAGE>
(16) Schedule for Computation of Performance Quotations
<PAGE>
Z070
BNY HAMILTON MONEY FUND
<TABLE>
<CAPTION>
HAMILTON PREMIER CLASSIC HAMILTON PREMIER CLASSIC HAMILTON PREMIER
DAILY DAILY DAILY DAILY DAILY DAILY 7 DAY 7 DAY
DATE FACTOR FACTOR FACTOR YIELD YIELD YIELD FACTOR FACTOR
- ---- -------- ------- ------- -------- ------- ------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
12/02/97 0.000149316 0.00014185 0.000132927 5.45% 5.18% 4.85% 0.001052600 0.001000313
12/03/97 0.000149296 0.000141839 0.000132874 5.45% 5.18% 4.85% 0.001052500 0.001000213
12/04/97 0.000148506 0.000141057 0.000132157 5.42% 5.15% 4.82% 0.001051610 0.000999331
12/05/97 0.000147851 0.000140409 0.000131498 5.40% 5.12% 4.80% 0.001048188 0.000995948
12/06/97 0.000147851 0.000140409 0.000131498 5.40% 5.12% 4.80% 0.001044766 0.000992565
12/07/97 0.00014785 0.000140409 0.000131497 5.40% 5.12% 4.80% 0.001041343 0.000989183
12/08/97 0.000148384 0.000140957 0.000132031 5.42% 5.14% 4.82% 0.001039054 0.000986930
12/09/97 0.000148113 0.000140679 0.000131727 5.41% 5.13% 4.81% 0.001037851 0.000985759
12/10/97 0.000147654 0.000140219 0.000131274 5.39% 5.12% 4.79% 0.001036209 0.000984139
12/11/97 0.000148176 0.000140752 0.000131682 5.41% 5.14% 4.81% 0.001035879 0.000983834
12/12/97 0.000148546 0.000141126 0.000132054 5.42% 5.15% 4.82% 0.001036574 0.000984551
12/13/97 0.000148546 0.000141125 0.000132053 5.42% 5.15% 4.82% 0.001037269 0.000985267
12/14/97 0.000148545 0.000141125 0.000132053 5.42% 5.15% 4.82% 0.001037964 0.000985983
12/15/97 0.000151964 0.000144539 0.000135455 5.55% 5.28% 4.94% 0.001041544 0.000989565
12/16/97 0.000150167 0.000142742 0.000133693 5.48% 5.21% 4.88% 0.001043598 0.000991628
12/17/97 0.000152098 0.000144682 0.000135591 5.55% 5.28% 4.95% 0.001048042 0.000996091
12/18/97 0.000151043 0.000143635 0.000134538 5.51% 5.24% 4.91% 0.001050909 0.000998974
12/19/97 0.000149694 0.000142279 0.000133195 5.46% 5.19% 4.86% 0.001052057 0.001000127
12/20/97 0.000149694 0.000142279 0.000133195 5.46% 5.19% 4.86% 0.001053205 0.001001281
12/21/97 0.000149694 0.000142279 0.000133194 5.46% 5.19% 4.86% 0.001054354 0.001002435
12/22/97 0.000150167 0.000142751 0.000133628 5.48% 5.21% 4.88% 0.001052557 0.001000647
12/23/97 0.000150054 0.00014263 0.000133350 5.48% 5.21% 4.87% 0.001052444 0.001000535
12/24/97 0.000149783 0.000142348 0.000133058 5.47% 5.20% 4.86% 0.001050129 0.000998201
12/25/97 0.000149783 0.000142348 0.000133058 5.47% 5.20% 4.86% 0.001048869 0.000996914
12/26/97 0.000149255 0.000141823 0.000132532 5.45% 5.18% 4.84% 0.001048430 0.000996458
12/27/97 0.000149254 0.000141822 0.000132532 5.45% 5.18% 4.84% 0.001047990 0.000996001
12/28/97 0.000149254 0.000141822 0.000132531 5.45% 5.18% 4.84% 0.001047550 0.000995544
12/29/97 0.000150575 0.000143134 0.000133776 5.50% 5.22% 4.88% 0.001047958 0.000995927
12/30/97 0.000151152 0.000143711 0.000134330 5.52% 5.25% 4.90% 0.001049056 0.000997008
12/31/97 0.000163046 0.000155596 0.000146236 5.95% 5.68% 5.34% 0.001062319 0.001010256
<CAPTION>
CLASSIC HAMILTON PREMIER CLASSIC HAMILTON PREMIER CLASSIC
7 DAY 7 DAY 7 DAY 7 DAY EFFECTIVE 7 EFFECTIVE 7 EFFECTIVE 7
DATE FACTOR YIELD YIELD YIELD 7 DAY YIELD 7 DAY YIELD 7 DAY YIELD
- ---- ------- -------- ------- ------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
12/02/97 0.000937754 5.49% 5.22% 4.89% 5.64% 5.35% 5.01%
12/03/97 0.000937632 5.49% 5.22% 4.89% 5.64% 5.35% 5.01%
12/04/97 0.000936794 5.48% 5.21% 4.88% 5.63% 5.35% 5.00%
12/05/97 0.000933442 5.47% 5.19% 4.87% 5.61% 5.33% 4.99%
12/06/97 0.000930091 5.45% 5.18% 4.85% 5.60% 5.31% 4.97%
12/07/97 0.000926739 5.43% 5.16% 4.83% 5.58% 5.29% 4.95%
12/08/97 0.000924482 5.42% 5.15% 4.82% 5.56% 5.28% 4.94%
12/09/97 0.000923282 5.41% 5.14% 4.81% 5.56% 5.27% 4.93%
12/10/97 0.000921682 5.40% 5.13% 4.81% 5.55% 5.26% 4.92%
12/11/97 0.000921207 5.40% 5.13% 4.80% 5.55% 5.26% 4.92%
12/12/97 0.000921763 5.40% 5.13% 4.81% 5.55% 5.27% 4.92%
12/13/97 0.000922318 5.41% 5.14% 4.81% 5.55% 5.27% 4.92%
12/14/97 0.000922874 5.41% 5.14% 4.81% 5.56% 5.27% 4.93%
12/15/97 0.000926298 5.43% 5.16% 4.83% 5.58% 5.29% 4.95%
12/16/97 0.000928264 5.44% 5.17% 4.84% 5.59% 5.30% 4.96%
12/17/97 0.000932581 5.46% 5.19% 4.86% 5.61% 5.33% 4.98%
12/18/97 0.000935437 5.48% 5.21% 4.88% 5.63% 5.34% 5.00%
12/19/97 0.000936578 5.49% 5.21% 4.88% 5.64% 5.35% 5.00%
12/20/97 0.000937720 5.49% 5.22% 4.89% 5.64% 5.36% 5.01%
12/21/97 0.000938861 5.50% 5.23% 4.90% 5.65% 5.36% 5.01%
12/22/97 0.000937034 5.49% 5.22% 4.89% 5.64% 5.35% 5.00%
12/23/97 0.000936691 5.49% 5.22% 4.88% 5.64% 5.35% 5.00%
12/24/97 0.000934158 5.48% 5.20% 4.87% 5.63% 5.34% 4.99%
12/25/97 0.000932678 5.47% 5.20% 4.86% 5.62% 5.33% 4.98%
12/26/97 0.000932015 5.47% 5.20% 4.86% 5.62% 5.33% 4.98%
12/27/97 0.000931352 5.46% 5.19% 4.86% 5.61% 5.33% 4.97%
12/28/97 0.000930689 5.46% 5.19% 4.85% 5.61% 5.33% 4.97%
12/29/97 0.000930837 5.46% 5.19% 4.85% 5.61% 5.33% 4.97%
12/30/97 0.000931817 5.47% 5.20% 4.86% 5.62% 5.33% 4.98%
12/31/97 0.000944995 5.54% 5.27% 4.93% 5.69% 5.41% 5.05%
</TABLE>
<PAGE>
Z070
BNY HAMILTON TREASURY MONEY FUND
<TABLE>
<CAPTION>
HAMILTON PREMIER HAMILTON PREMIER HAMILTON PREMIER HAMILTON
DAILY DAILY DAILY DAILY 7 DAY 7 DAY 7 DAY
DATE FACTOR FACTOR YIELD YIELD FACTOR FACTOR YIELD
---- -------- ------- -------- -------- -------- ------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
12/02/97 0.000148275 0.000141426 5.41% 5.16% 0.001047281 0.000999335 5.46%
12/03/97 0.000148151 0.000141302 5.41% 5.16% 0.001048530 0.001000584 5.47%
12/04/97 0.000146212 0.000139363 5.34% 5.09% 0.001047840 0.000999895 5.46%
12/05/97 0.000144531 0.000137682 5.28% 5.03% 0.001040918 0.000992974 5.43%
12/06/97 0.000144531 0.000137682 5.28% 5.03% 0.001033997 0.000986053 5.39%
12/07/97 0.00014453 0.000137681 5.28% 5.03% 0.001027075 0.000979132 5.36%
12/08/97 0.000145296 0.000138447 5.30% 5.05% 0.001021526 0.000973583 5.33%
12/09/97 0.000144805 0.000137956 5.29% 5.04% 0.001018056 0.000970113 5.31%
12/10/97 0.00014369 0.00013684 5.24% 4.99% 0.001013595 0.000965651 5.29%
12/11/97 0.000144412 0.000137562 5.27% 5.02% 0.001011795 0.000963850 5.28%
12/12/97 0.000145051 0.000138201 5.29% 5.04% 0.001012315 0.000964369 5.28%
12/13/97 0.00014505 0.000138201 5.29% 5.04% 0.001012834 0.000964888 5.28%
12/14/97 0.00014505 0.000138202 5.29% 5.04% 0.001013354 0.000965409 5.28%
12/15/97 0.00015123 0.00014438 5.52% 5.27% 0.001019288 0.000971342 5.31%
12/16/97 0.000147163 0.000140314 5.37% 5.12% 0.001021646 0.000973700 5.33%
12/17/97 0.000152064 0.000145215 5.55% 5.30% 0.001030020 0.000982075 5.37%
12/18/97 0.00014916 0.00014231 5.44% 5.19% 0.001034768 0.000986823 5.40%
12/19/97 0.000146973 0.000140124 5.36% 5.11% 0.001036690 0.000988746 5.41%
12/20/97 0.000146973 0.000140124 5.36% 5.11% 0.001038613 0.000990669 5.42%
12/21/97 0.000146972 0.000140123 5.36% 5.11% 0.001040535 0.000992590 5.43%
12/22/97 0.000150428 0.000143579 5.49% 5.24% 0.001039733 0.000991789 5.42%
12/23/97 0.000147987 0.000141138 5.40% 5.15% 0.001040557 0.000992613 5.43%
12/24/97 0.000146151 0.000139302 5.33% 5.08% 0.001034644 0.000986700 5.39%
12/25/97 0.00014615 0.000139301 5.33% 5.08% 0.001031634 0.000983691 5.38%
12/26/97 0.000145103 0.000138254 5.30% 5.05% 0.001029764 0.000981821 5.37%
12/27/97 0.000145103 0.000138253 5.30% 5.05% 0.001027894 0.000979950 5.36%
12/28/97 0.000145102 0.000138253 5.30% 5.05% 0.001026024 0.000978080 5.35%
12/29/97 0.000147425 0.000140575 5.38% 5.13% 0.001023021 0.000975076 5.33%
12/30/97 0.000148473 0.000141624 5.42% 5.17% 0.001023507 0.000975562 5.34%
12/31/97 0.000169851 0.000163002 6.20% 5.95% 0.001047207 0.000999262 5.46%
<CAPTION>
PREMIER HAMILTON PREMIER HAMILTON PREMIER
7 DAY EFFECTIVE 7 EFFECTIVE 7 EFFECTIVE 7 EFFECTIVE 7
YIELD 7 DAY YIELD 7 DAY YIELD 7 DAY YIELD 7 DAY YIELD
<S> <C> <C> <C> <C> <C>
12/02/97 5.21% 5.46% 5.21% 5.61% 5.35%
12/03/97 5.22% 5.47% 5.22% 5.62% 5.35%
12/04/97 5.21% 5.46% 5.21% 5.61% 5.35%
12/05/97 5.18% 5.43% 5.18% 5.57% 5.31%
12/06/97 5.14% 5.39% 5.14% 5.54% 5.27%
12/07/97 5.11% 5.36% 5.11% 5.50% 5.24%
12/08/97 5.08% 5.33% 5.08% 5.47% 5.21%
12/09/97 5.06% 5.31% 5.06% 5.45% 5.19%
12/10/97 5.04% 5.29% 5.04% 5.42% 5.16%
12/11/97 5.03% 5.28% 5.03% 5.41% 5.15%
12/12/97 5.03% 5.28% 5.03% 5.42% 5.15%
12/13/97 5.03% 5.28% 5.03% 5.42% 5.16%
12/14/97 5.03% 5.28% 5.03% 5.42% 5.16%
12/15/97 5.06% 5.31% 5.06% 5.46% 5.19%
12/16/97 5.08% 5.33% 5.08% 5.47% 5.21%
12/17/97 5.12% 5.37% 5.12% 5.51% 5.25%
12/18/97 5.15% 5.40% 5.15% 5.54% 5.28%
12/19/97 5.16% 5.41% 5.16% 5.55% 5.29%
12/20/97 5.17% 5.42% 5.17% 5.56% 5.30%
12/21/97 5.18% 5.43% 5.18% 5.57% 5.31%
12/22/97 5.17% 5.42% 5.17% 5.57% 5.30%
12/23/97 5.18% 5.43% 5.18% 5.57% 5.31%
12/24/97 5.14% 5.39% 5.14% 5.54% 5.28%
12/25/97 5.13% 5.38% 5.13% 5.52% 5.26%
12/26/97 5.12% 5.37% 5.12% 5.51% 5.25%
12/27/97 5.11% 5.36% 5.11% 5.50% 5.24%
12/28/97 5.10% 5.35% 5.10% 5.49% 5.23%
12/29/97 5.08% 5.33% 5.08% 5.48% 5.21%
12/30/97 5.09% 5.34% 5.09% 5.48% 5.22%
12/31/97 5.21% 5.46% 5.21% 5.61% 5.35%
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
(Institutional Shares - With Reimbursement)
30 DAY SEC YIELD
Income 331,405.85
Net Expenses:
Gross Expenses 51,257.57
Less: Reimbursement 4,235.94 47,021.63
Avg. Shares 6,447,414.3151
POP 9.88
Factors to be used: 1.004464399
1.004464399 1.008948729
1.004464399 1.013453079
1.004464399 1.017977538
1.004464399 1.022522196
1.004464399 1.027087143
SEC YIELD 5.42%
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
(Institutional Shares - Without Reimbursement)
30 DAY SEC YIELD
Income 331,405.85
Net Expenses:
Gross Expenses 51,257.57
Less: Reimbursement 0.00 51,257.57
Avg. Shares 6,447,414.3151
POP 9.88
Factors to be used: 1.004397901
1.004397901 1.008815144
1.004397901 1.013251813
1.004397901 1.017707994
1.004397901 1.022183773
1.004397901 1.026679236
SEC YIELD 5.34%
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
(Investor Shares - With Reimbursement)
30 DAY SEC YIELD
Income 54,268.82
Net Expenses:
Gross Expenses 10,888.97
Less: Reimbursement 1,050.27 9,838.70
Avg. Shares 1,056,289.6558
POP 9.87
Factors to be used: 1.004261645
1.004261645 1.008541452
1.004261645 1.012839498
1.004261645 1.017155860
1.004261645 1.021490617
1.004261645 1.025843847
SEC YIELD 5.17%
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
(Investor Shares - Without Reimbursement)
30 DAY SEC YIELD
Income 54,268.82
Net Expenses:
Gross Expenses 10,888.97
Less: Reimbursement 0.00 10,888.97
Avg. Shares 1,056,289.6558
POP 9.87
Factors to be used: 1.004160906
1.004160906 1.008339125
1.004160906 1.012534729
1.004160906 1.016747791
1.004160906 1.020978383
1.004160906 1.025226578
SEC YIELD 5.05%
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
(Institutional Shares)
30 DAY SEC YIELD
Income 1,886,038.32
Net Expenses:
Gross Expenses 227,589.10
Less: Reimbursement 0.00 227,589.10
Avg. Shares 33,501,762.5543
POP 10.45
Factors to be used: 1.004737162
1.004737162 1.009496765
1.004737162 1.014278915
1.004737162 1.019083719
1.004737162 1.023911284
1.004737162 1.028761718
SEC YIELD 5.75%
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
(Investor Shares)
30 DAY SEC YIELD
Income 10,110.80
Net Expenses:
Gross Expenses 1,639.21
Less: Reimbursement 0.00 1,639.21
Avg. Shares 179,491.6266
POP 10.45
Factors to be used: 1.004516525
1.004516525 1.009053449
1.004516525 1.013610864
1.004516525 1.018188863
1.004516525 1.022787538
1.004516525 1.027406983
SEC YIELD 5.48%
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
(Institutional Shares - With Reimbursement)
30 DAY SEC YIELD
Income 114,316.96
Net Expenses:
Gross Expenses 30,008.44
Less: Reimbursement 6,881.64 23,126.80
Avg. Shares 2,976,978.8573
POP 10.52
Factors to be used: 1.002911766
1.002911766 1.005832010
1.002911766 1.008760757
1.002911766 1.011698032
1.002911766 1.014643860
1.002911766 1.017598265
SEC YIELD 3.52%
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
(Institutional Shares - Without Reimbursement)
30 DAY SEC YIELD
Income 114,316.96
Net Expenses:
Gross Expenses 30,008.44
Less: Reimbursement 0.00 30,008.44
Avg. Shares 2,976,978.8573
POP 10.52
Factors to be used: 1.002692030
1.002692030 1.005391307
1.002692030 1.008097851
1.002692030 1.010811681
1.002692030 1.013532816
1.002692030 1.016261277
SEC YIELD 3.25%
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
(Investor Shares - With Reimbursement)
30 DAY SEC YIELD
Income 37,975.29
Net Expenses:
Gross Expenses 12,101.88
Less: Reimbursement 2,291.53 9,810.35
Avg. Shares 988,932.6618
POP 10.52
Factors to be used: 1.002707238
1.002707238 1.005421805
1.002707238 1.008143721
1.002707238 1.010873006
1.002707238 1.013609680
1.002707238 1.016353763
SEC YIELD 3.27%
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
(Investor Shares - Without Reimbursement)
30 DAY SEC YIELD
Income 37,975.29
Net Expenses:
Gross Expenses 12,101.88
Less: Reimbursement 2,291.53 12,101.88
Avg. Shares 988,932.6618
POP 10.52
Factors to be used: 1.002486974
1.002486974 1.004980133
1.002486974 1.007479492
1.002486974 1.009985067
1.002486974 1.012496874
1.002486974 1.015014927
SEC YIELD 3.00%
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
(Institutional Shares)
30 DAY SEC YIELD
Income 1,028,143.01
Net Expenses:
Gross Expenses 176,023.40
Less: Reimbursement 0.00 176.023.40
Avg. Shares 26,156,592.7758
POP 10.27
Factors to be used: 1.003172115
1.003172115 1.006354292
1.003172115 1.009546564
1.003172115 1.012748962
1.003172115 1.015961518
1.003172115 1.019184265
SEC YIELD 3.84%
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
(Investor Shares)
30 DAY SEC YIELD
Income 676.39
Net Expenses:
Gross Expenses 158.10
Less: Reimbursement 0.00 158.10
Avg. Shares 17,194.2342
POP 10.28
Factors to be used: 1.002932222
1.002932222 1.005873042
1.002932222 1.008822485
1.002932222 1.011780576
1.002932222 1.014747341
1.002932222 1.017722805
SEC YIELD 3.54%
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
INSTITUTIONAL SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
<TABLE>
<CAPTION>
==================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
==================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 10.00 100.0000 1000.00
08/31/92 9.96 0.023962 0.240577 100.2406 998.40
09/30/92 10.07 0.038543 0.383674 100.6243 1013.29
10/31/92 9.89 0.039980 0.406770 101.0310 999.20
11/30/92 9.80 0.039200 0.404124 101.4351 994.06
12/31/92 9.87 0.038400 0.394641 101.8297 1005.06
01/31/93 10.00 0.039377 0.400975 102.2307 1022.31
02/28/93 10.13 0.036542 0.368779 102.5995 1039.33
03/31/93 10.11 0.040406 0.410050 103.0096 1041.43
04/30/93 10.14 0.040439 0.410809 103.4204 1048.68
05/31/93 10.08 0.044942 0.461106 103.8815 1047.13
06/30/93 10.22 0.043774 0.444944 104.3264 1066.22
07/31/93 10.19 0.045819 0.469103 104.7955 1067.87
08/31/93 10.33 0.045060 0.457126 105.2526 1087.26
09/30/93 10.34 0.043409 0.441868 105.6945 1092.88
10/31/93 10.33 0.043776 0.447911 106.1424 1096.45
11/30/93 10.15 0.042840 0.447994 106.5904 1081.89
12/31/93 10.12 0.042917 0.023000 0.694285 107.2847 1085.72
- --------------------------------------------------------------------------------------------------
01/31/94 10.22 0.041857 0.439390 107.7241 1100.94
02/28/94 9.93 0.039303 0.426369 108.1505 1073.93
03/31/94 9.64 0.043760 0.490946 108.6414 1047.30
04/30/94 9.51 0.042297 0.483197 109.1246 1037.77
05/31/94 9.45 0.043570 0.503128 109.6277 1035.98
06/30/94 9.35 0.042415 0.497311 110.1250 1029.67
07/31/94 9.43 0.041005 0.478863 110.6039 1042.99
08/31/94 9.41 0.040674 0.478077 111.0820 1045.28
09/30/94 9.24 0.041107 0.494183 111.5762 1030.96
10/31/94 9.18 0.042907 0.521503 112.0977 1029.06
11/30/94 9.10 0.041370 0.509613 112.6073 1024.73
12/31/94 9.10 0.043245 0.535132 113.1424 1029.60
- --------------------------------------------------------------------------------------------------
01/31/95 9.20 0.043580 0.535951 113.6784 1045.84
02/28/95 9.36 0.040390 0.490542 114.1689 1068.62
03/31/95 9.37 0.044622 0.543697 114.7126 1074.86
04/30/95 9.45 0.043662 0.530009 115.2426 1089.04
05/31/95 9.74 0.043864 0.518994 115.7616 1127.52
06/30/95 9.75 0.043571 0.517318 116.2789 1133.72
07/31/95 9.68 0.045053 0.541188 116.8201 1130.82
08/31/95 9.72 0.045151 0.542649 117.3627 1140.77
09/30/95 9.75 0.044625 0.537160 117.8999 1149.52
10/31/95 9.80 0.046131 0.554984 118.4549 1160.86
11/30/95 9.88 0.044648 0.535301 118.9902 1175.62
12/31/95 9.94 0.045420 0.543716 119.5339 1188.17
- --------------------------------------------------------------------------------------------------
01/31/96 9.95 0.045516 0.546805 120.0807 1194.80
02/29/96 9.79 0.045195 0.554346 120.6350 1181.02
03/31/96 9.70 0.045967 0.571673 121.2067 1175.70
04/30/96 9.61 0.044940 0.566808 121.7735 1170.24
05/31/96 9.54 0.045728 0.583696 122.3572 1167.29
06/30/96 9.60 0.044077 0.561785 122.9190 1180.02
07/31/96 9.58 0.045233 0.580375 123.4994 1183.12
08/31/96 9.53 0.045257 0.586486 124.0859 1182.54
09/30/96 9.63 0.044013 0.567123 124.6530 1200.41
10/31/96 9.73 0.044675 0.572340 125.2253 1218.44
11/30/96 9.81 0.043382 0.553774 125.7791 1233.89
12/31/96 9.70 0.044896 0.582163 126.3613 1225.7
- --------------------------------------------------------------------------------------------------
01/31/97 9.68 0.045177 0.589734 126.9510 1228.89
02/28/97 9.65 0.042036 0.553006 127.5040 1230.41
03/31/97 9.53 0.045726 0.611778 128.1158 1220.94
04/30/97 9.60 0.046039 0.614409 128.7302 1235.81
05/31/97 9.62 0.047383 0.634056 129.3643 1244.48
06/30/97 9.66 0.046247 0.619328 129.9836 1255.64
07/31/97 9.81 0.047242 0.625962 130.6096 1281.28
08/31/97 9.71 0.047538 0.639436 131.2490 1274.43
09/30/97 9.77 0.046980 0.631124 131.8801 1288.47
10/31/97 9.87 0.047928 0.640400 132.5205 1307.98
11/30/97 9.83 0.047392 0.638902 133.1594 1308.96
12/31/97 9.88 0.047704 0.642939 133.8023 1321.97
- --------------------------------------------------------------------------------------------------
<CAPTION>
==============================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
==============================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - -
08/31/92 -0.16% - - - - - - - - - - - -
09/30/92 1.49% - - - - - - - - - - - -
10/31/92 -1.39% 0.08% -0.08% - - - - - -
11/30/92 -0.51% -1.90% -0.43% - - - - - -
12/31/92 1.11% 0.59% -0.81% - - - - - -
01/31/93 1.72% 2.84% 2.31% - - - - - -
02/28/93 1.66% 3.41% 4.55% - - - - - -
03/31/93 0.20% 1.87% 3.62% - - - - - -
04/30/93 0.70% 0.90% 2.58% - - - 4.34%
05/31/93 -0.15% 0.55% 0.75% - - - 4.19%
06/30/93 1.82% 1.67% 2.38% - - - 6.09%
07/31/93 0.15% 1.98% 1.83% 6.79% 6.25%
08/31/93 1.82% 1.97% 3.83% 8.90% 8.18%
09/30/93 0.52% 2.34% 2.50% 7.85% 8.74%
10/31/93 0.33% 0.85% 2.68% 9.73% 9.09%
11/30/93 -1.33% -1.01% -0.49% 8.84% 7.64%
12/31/93 0.35% -0.98% -0.66% 8.03% 8.03%
- ---------------------------------------------------------------------------------------------
01/31/94 1.40% 1.76% 0.41% 7.69% 1.40%
02/28/94 -2.45% -1.09% -0.74% 3.33% -1.09%
03/31/94 -2.48% -4.87% -3.54% 0.56% -3.54%
04/30/94 -0.91% -3.37% -5.74% -1.04% -4.42%
05/31/94 -0.17% -1.08% -3.53% -1.06% -4.58%
06/30/94 -0.61% -0.78% -1.68% -3.43% -5.16%
07/31/94 1.29% 0.68% 0.50% -2.33% -3.94%
08/31/94 0.22% 1.52% 0.90% -3.86% -3.72%
09/30/94 -1.37% -1.15% 0.13% -5.67% -5.04%
10/31/94 -0.18% -1.55% -1.34% -6.15% -5.22%
11/30/94 -0.42% -0.60% -1.97% -5.28% -5.62%
12/31/94 0.48% 0.05% -0.13% -5.17% -5.17%
- ---------------------------------------------------------------------------------------------
01/31/95 1.58% 2.06% 1.63% -5.00% 1.58%
02/28/95 2.18% 3.79% 4.28% -0.49% 3.79%
03/31/95 0.58% 2.77% 4.40% 2.63% 4.40%
04/30/95 1.32% 1.91% 4.13% 4.94% 5.77%
05/31/95 3.53% 4.90% 5.51% 8.84% 9.51%
06/30/95 0.55% 4.10% 5.48% 10.11% 10.11%
07/31/95 -0.26% 0.29% 3.84% 8.42% 9.83%
08/31/95 0.88% 0.62% 1.18% 9.14% 10.80%
09/30/95 0.77% 1.65% 1.39% 11.50% 11.65%
10/31/95 0.99% 1.76% 2.66% 12.81% 12.75%
11/30/95 1.27% 2.27% 3.05% 14.72% 14.18%
12/31/95 1.07% 2.35% 3.36% 15.40% 15.40%
- ---------------------------------------------------------------------------------------------
01/31/96 0.56% 1.63% 2.92% 14.24% 0.56%
02/29/96 -1.15% -0.60% 0.46% 10.52% -0.60%
03/31/96 -0.45% -1.60% -1.05% 9.38% -1.05%
04/30/96 -0.46% -0.91% -2.06% 7.46% -1.51%
05/31/96 -0.25% -0.72% -1.16% 3.53% -1.76%
06/30/96 1.09% 0.84% 0.37% 4.08% -0.69%
07/31/96 0.26% 1.36% 1.10% 4.62% -0.43%
08/31/96 -0.05% 0.21% 1.31% 3.66% -0.47%
09/30/96 1.51% 1.46% 1.73% 4.43% 1.03%
10/31/96 1.50% 3.04% 2.99% 4.96% 2.55%
11/30/96 1.27% 2.79% 4.34% 4.96% 3.85%
12/31/96 -0.66% 0.60% 2.11% 3.16% 3.16%
- ---------------------------------------------------------------------------------------------
01/31/97 0.26% -0.41% 0.86% 2.85% 0.26%
02/28/97 0.12% 0.38% -0.28% 4.18% 0.38%
03/31/97 -0.77% -0.65% -0.39% 3.85% -0.39%
04/30/97 1.22% 0.44% 0.56% 5.60% 0.82%
05/31/97 0.70% 1.93% 1.14% 6.61% 1.53%
06/30/97 0.90% 1.60% 2.84% 6.41% 2.44%
07/31/97 2.04% 2.96% 3.68% 8.30% 4.53%
08/31/97 -0.53% 1.50% 2.41% 7.77% 3.98%
09/30/97 1.10% 0.56% 2.61% 7.34% 5.12%
10/31/97 1.51% 2.63% 2.08% 7.35% 6.71%
11/30/97 0.07% 1.59% 2.71% 6.08% 6.79%
12/31/97 0.99% 1.07% 2.60% 8.27% 7.85% 7.85%
- ---------------------------------------------------------------------------------------------
<CAPTION>
=================================================================================================================
Trailing Trailing 3 Yr Trailing Trailing 5 Yr Total Since Avg. Annual
Date 3 Years Avg.Ann.Rtn. 5 Years Avg.Ann.Rtn. Inception Return
=================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - - - - - - - - - - -
08/31/92 - - - - - - - - - - - - - - - - -0.16% - - - -
09/30/92 - - - - - - - - - - - - - - - - 1.33% - - - -
10/31/92 - - - - - - - - - - - - - - - - -0.08% - - - -
11/30/92 - - - - - - - - - - - - - - - - -0.59% - - - -
12/31/92 - - - - - - - - - - - - - - - - 0.51% - - - -
01/31/93 - - - - - - - - - - - - - - - - 2.23% 4.71%
02/28/93 - - - - - - - - - - - - - - - - 3.93% 7.18%
03/31/93 - - - - - - - - - - - - - - - - 4.14% 6.54%
04/30/93 - - - - - - - - - - - - - - - - 4.87% 6.79%
05/31/93 - - - - - - - - - - - - - - - - 4.71% 5.86%
06/30/93 - - - - - - - - - - - - - - - - 6.62% 7.47%
07/31/93 - - - - - - - - - - - - - - - - 6.79% 6.96%
08/31/93 - - - - - - - - - - - - - - - - 8.73% 8.21%
09/30/93 - - - - - - - - - - - - - - - - 9.29% 8.08%
10/31/93 - - - - - - - - - - - - - - - - 9.65% 7.79%
11/30/93 - - - - - - - - - - - - - - - - 8.19% 6.19%
12/31/93 - - - - - - - - - - - - - - - - 8.57% 6.07%
- -----------------------------------------------------------------------------------------------------------------
01/31/94 - - - - - - - - - - - - - - - - 10.09% 6.72%
02/28/94 - - - - - - - - - - - - - - - - 7.39% 4.69%
03/31/94 - - - - - - - - - - - - - - - - 4.73% 2.86%
04/30/94 - - - - - - - - - - - - - - - - 3.78% 2.17%
05/31/94 - - - - - - - - - - - - - - - - 3.60% 1.97%
06/30/94 - - - - - - - - - - - - - - - - 2.97% 1.56%
07/31/94 - - - - - - - - - - - - - - - - 4.30% 2.15%
08/31/94 - - - - - - - - - - - - - - - - 4.53% 2.17%
09/30/94 - - - - - - - - - - - - - - - - 3.10% 1.43%
10/31/94 - - - - - - - - - - - - - - - - 2.91% 1.29%
11/30/94 - - - - - - - - - - - - - - - - 2.47% 1.06%
12/31/94 - - - - - - - - - - - - - - - - 2.96% 1.23%
- -----------------------------------------------------------------------------------------------------------------
01/31/95 - - - - - - - - - - - - - - - - 4.58% 1.82%
02/28/95 - - - - - - - - - - - - - - - - 6.86% 2.63%
03/31/95 - - - - - - - - - - - - - - - - 7.49% 2.77%
04/30/95 - - - - - - - - - - - - - - - - 8.90% 3.18%
05/31/95 - - - - - - - - - - - - - - - - 12.75% 4.37%
06/30/95 - - - - - - - - - - - - - - - - 13.37% 4.44%
07/31/95 - - - - - - - - - - - - - - - - 13.08% 4.22%
08/31/95 14.26% 4.54% - - - - - - - - 14.08% 4.40%
09/30/95 13.44% 4.29% - - - - - - - - 14.95% 4.53%
10/31/95 16.18% 5.13% - - - - - - - - 16.09% 4.73%
11/30/95 18.26% 5.75% - - - - - - - - 17.56% 5.01%
12/31/95 18.22% 5.74% - - - - - - - - 18.82% 5.21%
- --------------------------------------------------------------------------------------------------------------
01/31/96 16.87% 5.33% - - - - - - - - 19.48% 5.25%
02/29/96 13.63% 4.35% - - - - - - - - 18.10% 4.79%
03/31/96 12.89% 4.12% - - - - - - - - 17.57% 4.54%
04/30/96 11.59% 3.72% - - - - - - - - 17.02% 4.31%
05/31/96 11.48% 3.68% - - - - - - - - 16.73% 4.14%
06/30/96 10.67% 3.43% - - - - - - - - 18.00% 4.34%
07/31/96 10.79% 3.47% - - - - - - - - 18.31% 4.32%
08/31/96 8.76% 2.84% - - - - - - - - 18.25% 4.21%
09/30/96 9.84% 3.17% - - - - - - - - 20.04% 4.51%
10/31/96 11.13% 3.58% - - - - - - - - 21.84% 4.78%
11/30/96 14.05% 4.48% - - - - - - - - 23.39% 4.99%
12/31/96 12.89% 4.12% - - - - - - - - 22.57% 4.74%
- --------------------------------------------------------------------------------------------------------------
01/31/97 11.62% 3.73% - - - - - - - - 22.89% 4.71%
02/28/97 14.57% 4.63% - - - - - - - - 23.04% 4.65%
03/31/97 16.58% 5.24% - - - - - - - - 22.09% 4.39%
04/30/97 19.08% 5.99% - - - - - - - - 23.58% 4.58%
05/31/97 20.13% 6.30% - - - - - - - - 24.45% 4.65%
06/30/97 21.95% 6.83% - - - - - - - - 25.56% 4.76%
07/31/97 22.85% 7.09% - - - - - - - - 28.13% 5.11%
08/31/97 21.92% 6.82% 27.65% 5.00% 27.44% 4.91%
09/30/97 24.98% 7.71% 27.16% 4.92% 28.85% 5.05%
10/31/97 27.10% 8.31% 30.90% 5.53% 30.80% 5.27%
11/30/97 27.74% 8.49% 31.68% 5.65% 30.90% 5.20%
12/31/97 28.40% 8.68% 31.53% 5.63% 32.20% 5.31%
- --------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
INVESTOR SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
==========================================================================================================================
Dividend Dividend Total Extended Change For/(From) Year to
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months 3 Months 12 Months Date
==========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
08/10/92 10.00 100.0000 1,000.00 - - - - - - - - - - - -
08/31/92 9.96 0.023962 0.240577 100.2406 998.40 -0.16% - - - - - - -0.16%
09/30/92 10.07 0.038543 0.383674 100.6243 1,013.29 1.49% - - - - - - 1.33%
10/31/92 9.89 0.039980 0.406770 101.0310 999.20 -1.39% 0.08% -0.08% - - - -0.08%
11/30/92 9.80 0.039200 0.404124 101.4351 994.06 -0.51% -1.90% -0.43% - - - -0.59%
12/31/92 9.87 0.038400 0.394641 101.8297 1,005.06 1.11% 0.59% -0.81% - - - 0.51%
01/31/93 10.00 0.039377 0.400975 102.2307 1,022.31 1.72% 2.84% 2.31% - - - 1.72%
02/28/93 10.13 0.036542 0.368779 102.5995 1,039.33 1.66% 3.41% 4.55% - - - 3.41%
03/31/93 10.11 0.040406 0.410050 103.0096 1,041.43 0.20% 1.87% 3.62% - - - 3.62%
04/30/93 10.14 0.040439 0.410809 103.4204 1,048.68 0.70% 0.90% 2.58% - - - 4.34%
05/31/93 10.08 0.044942 0.461106 103.8815 1,047.13 -0.15% 0.55% 0.75% - - - 4.19%
06/30/93 10.22 0.043774 0.444944 104.3264 1,066.22 1.82% 1.67% 2.38% - - - 6.09%
07/31/93 10.19 0.045819 0.469103 104.7955 1,067.87 0.15% 1.98% 1.83% 6.79% 6.25%
08/31/93 10.33 0.045060 0.457126 105.2526 1,087.26 1.82% 1.97% 3.83% 8.90% 8.18%
09/30/93 10.34 0.043409 0.441868 105.6945 1,092.88 0.52% 2.34% 2.50% 7.85% 8.74%
10/31/93 10.33 0.043776 0.447911 106.1424 1,096.45 0.33% 0.85% 2.68% 9.73% 9.09%
11/30/93 10.15 0.042840 0.447994 106.5904 1,081.89 -1.33% -1.01% -0.49% 8.84% 7.64%
12/31/93 10.12 0.042917 0.023000 0.694285 107.2847 1,085.72 0.35% -0.98% -0.66% 8.03% 8.03%
- --------------------------------------------------------------------------------------------------------------------------
01/31/94 10.22 0.041857 0.439390 107.7241 1,100.94 1.40% 1.76% 0.41% 7.69% 1.40%
02/28/94 9.93 0.039303 0.426369 108.1505 1,073.93 -2.45% -1.09% -0.74% 3.33% -1.09%
03/31/94 9.64 0.043760 0.490946 108.6414 1,047.30 -2.48% -4.87% -3.54% 0.56% -3.54%
04/30/94 9.51 0.042297 0.483197 109.1246 1,037.77 -0.91% -3.37% -5.74% -1.04% -4.42%
05/31/94 9.45 0.043570 0.503128 109.6277 1,035.98 -0.17% -1.08% -3.53% -1.06% -4.58%
06/30/94 9.35 0.042415 0.497311 110.1250 1,029.67 -0.61% -0.78% -1.68% -3.43% -5.16%
07/31/94 9.43 0.041005 0.478863 110.6039 1,042.99 1.29% 0.68% 0.50% -2.33% -3.94%
08/31/94 9.41 0.040674 0.478077 111.0820 1,045.28 0.22% 1.52% 0.90% -3.86% -3.72%
09/30/94 9.24 0.041107 0.494183 111.5762 1,030.96 -1.37% -1.15% 0.13% -5.67% -5.04%
10/31/94 9.18 0.042907 0.521503 112.0977 1,029.06 -0.18% -1.55% -1.34% -6.15% -5.22%
11/30/94 9.10 0.041370 0.509613 112.6073 1,024.73 -0.42% -0.60% -1.97% -5.28% -5.62%
12/31/94 9.10 0.043245 0.535132 113.1424 1,029.60 0.48% 0.05% -0.13% -5.17% -5.17%
- --------------------------------------------------------------------------------------------------------------------------
01/31/95 9.20 0.043580 0.535951 113.6784 1,045.84 1.58% 2.06% 1.63% -5.00% 1.58%
02/28/95 9.36 0.040390 0.490542 114.1689 1,068.62 2.18% 3.79% 4.28% -0.49% 3.79%
03/31/95 9.37 0.044622 0.543697 114.7126 1,074.86 0.58% 2.77% 4.40% 2.63% 4.40%
04/30/95 9.45 0.043662 0.530009 115.2426 1,089.04 1.32% 1.91% 4.13% 4.94% 5.77%
05/31/95 9.74 0.043864 0.518994 115.7616 1,127.52 3.53% 4.90% 5.51% 8.84% 9.51%
06/30/95 9.75 0.043571 0.517318 116.2789 1,133.72 0.55% 4.10% 5.48% 10.11% 10.11%
07/31/95 9.68 0.045053 0.541188 116.8201 1,130.82 -0.26% 0.29% 3.84% 8.42% 9.83%
08/31/95 9.72 0.045151 0.542649 117.3627 1,140.77 0.88% 0.62% 1.18% 9.14% 10.80%
09/30/95 9.75 0.044625 0.537160 117.8999 1,149.52 0.77% 1.65% 1.39% 11.50% 11.65%
10/31/95 9.80 0.046131 0.554984 118.4549 1,160.86 0.99% 1.76% 2.66% 12.81% 12.75%
11/30/95 9.88 0.044648 0.535301 118.9902 1,175.62 1.27% 2.27% 3.05% 14.72% 14.18%
12/31/95 9.94 0.045420 0.543716 119.5339 1,188.17 1.07% 2.35% 3.36% 15.40% 15.40%
- --------------------------------------------------------------------------------------------------------------------------
01/31/96 9.95 0.045516 0.546805 120.0807 1,194.80 0.56% 1.63% 2.92% 14.24% 0.56%
02/29/96 9.79 0.045195 0.554346 120.6350 1,181.02 -1.15% -0.60% 0.46% 10.52% -0.60%
03/31/96 9.70 0.045967 0.571673 121.2067 1,175.70 -0.45% -1.60% -1.05% 9.38% -1.05%
04/30/96 9.61 0.044940 0.566808 121.7735 1,170.24 -0.46% -0.91% -2.06% 7.46% -1.51%
05/31/96 9.54 0.045728 0.583696 122.3572 1,167.29 -0.25% -0.72% -1.16% 3.53% -1.76%
06/30/96 9.60 0.044077 0.561785 122.9190 1,180.02 1.09% 0.84% 0.37% 4.08% -0.69%
07/31/96 9.58 0.045233 0.580375 123.4994 1,183.12 0.26% 1.36% 1.10% 4.62% -0.43%
08/31/96 9.53 0.045257 0.586486 124.0859 1,182.54 -0.05% 0.21% 1.31% 3.66% -0.47%
09/30/96 9.63 0.044013 0.567123 124.6530 1,200.41 1.51% 1.46% 1.73% 4.43% 1.03%
10/31/96 9.73 0.044675 0.572340 125.2253 1,218.44 1.50% 3.04% 2.99% 4.96% 2.55%
11/30/96 9.81 0.043382 0.553774 125.7791 1,233.89 1.27% 2.79% 4.34% 4.96% 3.85%
12/31/96 9.70 0.044896 0.582163 126.3613 1,225.70 -0.66% 0.60% 2.11% 3.16% 3.16%
- --------------------------------------------------------------------------------------------------------------------------
01/31/97 9.68 0.045177 0.589734 126.9510 1,228.89 0.26% -0.41% 0.86% 2.85% 0.26%
02/28/97 9.65 0.042036 0.553006 127.5040 1,230.41 0.12% 0.38% -0.28% 4.18% 0.38%
03/31/97 9.53 0.045726 0.611778 128.1158 1,220.94 -0.77% -0.65% -0.39% 3.85% -0.39%
04/30/97 9.59 0.044092 0.589039 128.7048 1,234.28 1.09% 0.31% 0.44% 5.47% 0.70%
05/31/97 9.61 0.045226 0.605703 129.3105 1,242.67 0.68% 1.78% 1.00% 6.46% 1.38%
06/30/97 9.66 0.044308 0.593115 129.9036 1,254.87 0.98% 1.67% 2.78% 6.34% 2.38%
07/31/97 9.80 0.045139 0.598339 130.5019 1,278.92 1.92% 2.92% 3.62% 8.10% 4.34%
08/31/97 9.70 0.045451 0.611489 131.1134 1,271.80 -0.56% 1.35% 2.34% 7.55% 3.76%
09/30/97 9.77 0.044957 0.603323 131.7167 1,286.87 1.18% 0.62% 2.55% 7.20% 4.99%
10/31/97 9.86 0.045826 0.612175 132.3289 1,304.76 1.39% 2.59% 2.02% 7.08% 6.45%
11/30/97 9.83 0.045347 0.610450 132.9394 1,306.79 0.16% 1.55% 2.75% 5.91% 6.62%
12/31/97 9.87 0.045588 0.614026 133.5534 1,318.17 0.87% 1.03% 2.43% 7.54% 7.54%
</TABLE>
<TABLE>
<CAPTION>
=============================================================================================
Trailing Trailing 3 Yr Trailing Trailing 5 Yr Total Since Avg. Annual
Date 3 Years Avg.Ann.Rtn. 5 Years Avg.Ann.Rtn. Inception Return
=============================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - - - - - - - - - - -
08/31/92 - - - - - - - - - - - - - - - - -0.16% - - - -
09/30/92 - - - - - - - - - - - - - - - - 1.33% - - - -
10/31/92 - - - - - - - - - - - - - - - - -0.08% - - - -
11/30/92 - - - - - - - - - - - - - - - - -0.59% - - - -
12/31/92 - - - - - - - - - - - - - - - - 0.51% - - - -
01/31/93 - - - - - - - - - - - - - - - - 2.23% 4.71%
02/28/93 - - - - - - - - - - - - - - - - 3.93% 7.18%
03/31/93 - - - - - - - - - - - - - - - - 4.14% 6.54%
04/30/93 - - - - - - - - - - - - - - - - 4.87% 6.79%
05/31/93 - - - - - - - - - - - - - - - - 4.71% 5.86%
06/30/93 - - - - - - - - - - - - - - - - 6.62% 7.47%
07/31/93 - - - - - - - - - - - - - - - - 6.79% 6.96%
08/31/93 - - - - - - - - - - - - - - - - 8.73% 8.21%
09/30/93 - - - - - - - - - - - - - - - - 9.29% 8.08%
10/31/93 - - - - - - - - - - - - - - - - 9.65% 7.79%
11/30/93 - - - - - - - - - - - - - - - - 8.19% 6.19%
12/31/93 - - - - - - - - - - - - - - - - 8.57% 6.07%
- ---------------------------------------------------------------------------------------------
01/31/94 - - - - - - - - - - - - - - - - 10.09% 6.72%
02/28/94 - - - - - - - - - - - - - - - - 7.39% 4.69%
03/31/94 - - - - - - - - - - - - - - - - 4.73% 2.86%
04/30/94 - - - - - - - - - - - - - - - - 3.78% 2.17%
05/31/94 - - - - - - - - - - - - - - - - 3.60% 1.97%
06/30/94 - - - - - - - - - - - - - - - - 2.97% 1.56%
07/31/94 - - - - - - - - - - - - - - - - 4.30% 2.15%
08/31/94 - - - - - - - - - - - - - - - - 4.53% 2.17%
09/30/94 - - - - - - - - - - - - - - - - 3.10% 1.43%
10/31/94 - - - - - - - - - - - - - - - - 2.91% 1.29%
11/30/94 - - - - - - - - - - - - - - - - 2.47% 1.06%
12/31/94 - - - - - - - - - - - - - - - - 2.96% 1.23%
- ---------------------------------------------------------------------------------------------
01/31/95 - - - - - - - - - - - - - - - - 4.58% 1.82%
02/28/95 - - - - - - - - - - - - - - - - 6.86% 2.63%
03/31/95 - - - - - - - - - - - - - - - - 7.49% 2.77%
04/30/95 - - - - - - - - - - - - - - - - 8.90% 3.18%
05/31/95 - - - - - - - - - - - - - - - - 12.75% 4.37%
06/30/95 - - - - - - - - - - - - - - - - 13.37% 4.44%
07/31/95 - - - - - - - - - - - - - - - - 13.08% 4.22%
08/31/95 14.26% 4.54% - - - - - - - - 14.08% 4.40%
09/30/95 13.44% 4.29% - - - - - - - - 14.95% 4.53%
10/31/95 16.18% 5.13% - - - - - - - - 16.09% 4.73%
11/30/95 18.26% 5.75% - - - - - - - - 17.56% 5.01%
12/31/95 18.22% 5.74% - - - - - - - - 18.82% 5.21%
- ---------------------------------------------------------------------------------------------
01/31/96 16.87% 5.33% - - - - - - - - 19.48% 5.25%
02/29/96 13.63% 4.35% - - - - - - - - 18.10% 4.79%
03/31/96 12.89% 4.12% - - - - - - - - 17.57% 4.54%
04/30/96 11.59% 3.72% - - - - - - - - 17.02% 4.31%
05/31/96 11.48% 3.68% - - - - - - - - 16.73% 4.14%
06/30/96 10.67% 3.43% - - - - - - - - 18.00% 4.34%
07/31/96 10.79% 3.47% - - - - - - - - 18.31% 4.32%
08/31/96 8.76% 2.84% - - - - - - - - 18.25% 4.21%
09/30/96 9.84% 3.17% - - - - - - - - 20.04% 4.51%
10/31/96 11.13% 3.58% - - - - - - - - 21.84% 4.78%
11/30/96 14.05% 4.48% - - - - - - - - 23.39% 4.99%
12/31/96 12.89% 4.12% - - - - - - - - 22.57% 4.74%
- ---------------------------------------------------------------------------------------------
01/31/97 11.62% 3.73% - - - - - - - - 22.89% 4.71%
02/28/97 14.57% 4.63% - - - - - - - - 23.04% 4.65%
03/31/97 16.58% 5.24% - - - - - - - - 22.09% 4.39%
04/30/97 18.94% 5.95% - - - - - - - - 23.43% 4.55%
05/31/97 19.95% 6.25% - - - - - - - - 24.27% 4.62%
06/30/97 21.87% 6.81% - - - - - - - - 25.49% 4.75%
07/31/97 22.62% 7.03% - - - - - - - - 27.89% 5.07%
08/31/97 21.67% 6.75% 27.38% 4.96% 27.18% 4.86%
09/30/97 24.82% 7.66% 27.00% 4.89% 28.69% 5.02%
10/31/97 26.79% 8.23% 30.58% 5.48% 30.48% 5.22%
11/30/97 27.53% 8.43% 31.46% 5.62% 30.68% 5.17%
12/31/97 28.03% 8.58% 31.15% 5.57% 31.82% 5.25%
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
Institutional Shares
<TABLE>
<CAPTION>
=====================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
=====================================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/86 5.215 0.000000 191.7630 1000.00
01/31/87 5.288 0.000000 191.7630 1014.07
02/28/87 5.316 0.000000 191.7630 1019.41
03/31/87 5.291 0.000000 191.7630 1014.69
04/30/87 5.082 0.000000 191.7630 974.58
05/31/87 5.059 0.000000 191.7630 970.17
06/30/87 5.119 0.000000 191.7630 981.68
07/31/87 5.109 0.000000 191.7630 979.79
08/31/87 5.088 0.000000 191.7630 975.74
09/30/87 4.974 0.000000 191.7630 953.86
10/31/87 5.137 0.000000 191.7630 985.02
11/30/87 5.178 0.000000 191.7630 992.97
12/31/87 5.224 0.000000 191.7630 1001.68
01/31/88 5.406 0.000000 191.7630 1036.61
02/29/88 5.440 0.000000 191.7630 1043.11
03/31/88 5.374 0.000000 191.7630 1030.45
04/30/88 5.340 0.000000 191.7630 1024.03
05/31/88 5.310 0.000000 191.7630 1018.27
06/30/88 5.420 0.000000 191.7630 1039.42
07/31/88 5.398 0.000000 191.7630 1035.12
08/31/88 5.420 0.000000 191.7630 1039.44
09/30/88 5.518 0.000000 191.7630 1058.22
10/31/88 5.617 0.000000 191.7630 1077.13
11/30/88 5.570 0.000000 191.7630 1068.16
12/31/88 5.569 0.000000 191.7630 1068.02
01/31/89 5.648 0.000000 191.7630 1083.05
02/28/89 5.616 0.000000 191.7630 1076.95
03/31/89 5.622 0.000000 191.7630 1078.10
04/30/89 5.737 0.000000 191.7630 1100.17
05/31/89 5.824 0.000000 191.7630 1116.75
06/30/89 5.975 0.000000 191.7630 1145.75
07/31/89 6.080 0.000000 191.7630 1166.00
08/31/89 6.099 0.000000 191.7630 1169.58
09/30/89 5.928 0.000000 191.7630 1136.80
10/31/89 6.247 0.000000 191.7630 1198.04
11/30/89 6.295 0.000000 191.7630 1207.22
12/31/89 6.335 0.000000 191.7630 1214.79
01/31/90 6.226 0.000000 191.7630 1193.86
02/28/90 6.251 0.000000 191.7630 1198.72
03/31/90 6.275 0.000000 191.7630 1203.24
04/30/90 6.224 0.000000 191.7630 1193.46
05/31/90 6.325 0.000000 191.7630 1212.88
06/30/90 6.325 0.000000 191.7630 1212.96
07/31/90 6.404 0.000000 191.7630 1228.09
08/31/90 6.274 0.000000 191.7630 1203.12
09/30/90 6.264 0.000000 191.7630 1201.28
10/31/90 6.450 0.000000 191.7630 1236.80
11/30/90 6.480 0.000000 191.7630 1242.70
12/31/90 6.586 0.000000 191.7630 1263.04
01/31/91 6.659 0.000000 191.7630 1277.03
02/28/91 6.673 0.000000 191.7630 1279.54
03/31/91 6.730 0.000000 191.7630 1290.63
04/30/91 6.795 0.000000 191.7630 1303.12
05/31/91 6.841 0.000000 191.7630 1311.94
06/30/91 6.829 0.000000 191.7630 1309.54
07/31/91 6.915 0.000000 191.7630 1326.00
08/31/91 7.061 0.000000 191.7630 1354.07
09/30/91 7.182 0.000000 191.7630 1377.18
10/31/91 7.252 0.000000 191.7630 1390.64
11/30/91 7.311 0.000000 191.7630 1402.00
12/31/91 7.567 0.000000 191.7630 1451.03
01/31/92 7.398 0.000000 191.7630 1418.63
02/28/92 7.433 0.000000 191.7630 1425.39
03/31/92 7.403 0.000000 191.7630 1419.65
04/30/92 7.447 0.000000 191.7630 1427.98
05/31/92 7.580 0.000000 191.7630 1453.64
06/30/92 7.703 0.000000 191.7630 1477.15
07/31/92 7.887 0.000000 191.7630 1512.41
08/31/92 7.960 0.000000 191.7630 1526.43
09/30/92 8.055 0.000000 191.7630 1544.70
10/31/92 7.932 0.000000 191.7630 1521.02
11/30/92 7.912 0.000000 191.7630 1517.17
12/31/92 8.036 0.000000 191.7630 1541.10
01/31/93 8.211 0.000000 191.7630 1574.49
02/28/93 8.346 0.000000 191.7630 1600.42
03/31/93 8.371 0.000000 191.7630 1605.34
04/30/93 8.425 0.000000 191.7630 1615.56
05/31/93 8.426 0.000000 191.7630 1615.84
06/30/93 8.636 0.000000 191.7630 1656.02
07/31/93 8.660 0.000000 191.7630 1660.61
<CAPTION>
=======================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
=======================================================================================================
<C> <C> <C> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - -
01/31/87 1.41% - - - - - - - - - 1.41%
02/28/87 0.53% 1.94% - - - - - - 1.94%
03/31/87 -0.46% 0.06% 1.47% - - - 1.47%
04/30/87 -3.95% -4.40% -3.89% - - - -2.54%
05/31/87 -0.45% -4.39% -4.83% - - - -2.98%
06/30/87 1.19% 0.73% -3.25% - - - -1.83%
07/31/87 -0.19% 0.99% 0.53% - - - -2.02%
08/31/87 -0.41% -0.61% 0.57% - - - -2.43%
09/30/87 -2.24% -2.65% -2.83% - - - -4.61%
10/31/87 3.27% 0.95% 0.53% - - - -1.50%
11/30/87 0.81% 4.10% 1.77% - - - -0.70%
12/31/87 0.88% 1.69% 5.01% 0.17% 0.17%
01/31/88 3.49% 4.39% 5.24% 2.22% 3.49%
02/29/88 0.63% 4.14% 5.05% 2.32% 4.14%
03/31/88 -1.21% -0.59% 2.87% 1.55% 2.87%
04/30/88 -0.62% -1.83% -1.21% 5.07% 2.23%
05/31/88 -0.56% -1.18% -2.38% 4.96% 1.66%
06/30/88 2.08% 1.50% 0.87% 5.88% 3.77%
07/31/88 -0.41% 1.66% 1.08% 5.65% 3.34%
08/31/88 0.42% 0.00% 2.08% 6.53% 3.77%
09/30/88 1.81% 2.23% 1.81% 10.94% 5.65%
10/31/88 1.79% 3.63% 4.06% 9.35% 7.53%
11/30/88 -0.83% 0.94% 2.76% 7.57% 6.64%
12/31/88 -0.01% -0.85% 0.93% 6.62% 6.62%
01/31/89 1.41% 1.39% 0.55% 4.48% 1.41%
02/28/89 -0.56% 0.84% 0.82% 3.24% 0.84%
03/31/89 0.11% -0.46% 0.94% 4.62% 0.94%
04/30/89 2.05% 2.16% 1.58% 7.44% 3.01%
05/31/89 1.51% 3.58% 3.70% 9.67% 4.56%
06/30/89 2.60% 4.14% 6.27% 10.23% 7.28%
07/31/89 1.77% 4.41% 5.98% 12.64% 9.17%
08/31/89 0.31% 2.08% 4.73% 12.52% 9.51%
09/30/89 -2.80% -2.50% -0.78% 7.43% 6.44%
10/31/89 5.39% 2.43% 2.75% 11.22% 12.17%
11/30/89 0.77% 6.20% 3.22% 13.02% 13.03%
12/31/89 0.63% 1.40% 6.86% 13.74% 13.74%
01/31/90 -1.72% -1.11% -0.35% 10.23% -1.72%
02/28/90 0.41% -1.32% -0.70% 11.31% -1.32%
03/31/90 0.38% -0.79% -0.95% 11.61% -0.95%
04/30/90 -0.81% -0.44% -0.03% 8.48% -1.76%
05/31/90 1.63% 0.80% 1.18% 8.61% -0.16%
06/30/90 0.01% 1.63% 0.81% 5.87% -0.15%
07/31/90 1.25% 1.25% 2.90% 5.32% 1.09%
08/31/90 -2.03% -0.81% -0.80% 2.87% -0.96%
09/30/90 -0.15% -2.18% -0.96% 5.67% -1.11%
10/31/90 2.96% 2.80% 0.71% 3.24% 1.81%
11/30/90 0.48% 3.45% 3.29% 2.94% 2.30%
12/31/90 1.64% 2.12% 5.14% 3.97% 3.97%
01/31/91 1.11% 2.76% 3.25% 6.97% 1.11%
02/28/91 0.20% 1.31% 2.96% 6.74% 1.31%
03/31/91 0.87% 1.07% 2.18% 7.26% 2.18%
04/30/91 0.97% 1.84% 2.04% 9.19% 3.17%
05/31/91 0.68% 1.65% 2.53% 8.17% 3.87%
06/30/91 -0.18% 0.49% 1.46% 7.96% 3.68%
07/31/91 1.26% 1.07% 1.76% 7.97% 4.98%
08/31/91 2.12% 3.40% 3.21% 12.55% 7.21%
09/30/91 1.71% 3.86% 5.17% 14.64% 9.04%
10/31/91 0.98% 2.70% 4.87% 12.44% 10.10%
11/30/91 0.82% 1.80% 3.54% 12.82% 11.00%
12/31/91 3.50% 4.34% 5.36% 14.88% 14.88%
01/31/92 -2.23% 1.19% 2.01% 11.09% -2.23%
02/28/92 0.48% -1.77% 1.67% 11.40% -1.77%
03/31/92 -0.40% 0.07% -2.16% 10.00% -2.16%
04/30/92 0.59% 0.18% 0.66% 9.58% -1.59%
05/31/92 1.80% 2.39% 1.98% 10.80% 0.18%
06/30/92 1.62% 3.44% 4.05% 12.80% 1.80%
07/31/92 2.39% 4.04% 5.91% 14.06% 4.23%
08/31/92 0.93% 3.34% 5.01% 12.73% 5.20%
09/30/92 1.20% 2.14% 4.57% 12.16% 6.46%
10/31/92 -1.53% -0.35% 0.57% 9.38% 4.82%
11/30/92 -0.25% -1.78% -0.61% 8.21% 4.56%
12/31/92 1.58% 1.32% -0.23% 6.21% 6.21%
01/31/93 2.17% 3.78% 3.52% 10.99% 2.17%
02/28/93 1.65% 3.85% 5.49% 12.28% 3.85%
03/31/93 0.31% 1.96% 4.17% 13.08% 4.17%
04/30/93 0.64% 0.95% 2.61% 13.14% 4.83%
05/31/93 0.02% 0.65% 0.96% 11.16% 4.85%
06/30/93 2.49% 2.50% 3.16% 12.11% 7.46%
07/31/93 0.28% 2.77% 2.79% 9.80% 7.76%
<CAPTION>
=========================================================================================
Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
=========================================================================================
<S> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - - -
01/31/87 - - - - - - - - - - - - - - - -
02/28/87 - - - - - - - - - - - - - - - -
03/31/87 - - - - - - - - - - - - - - - -
04/30/87 - - - - - - - - - - - - - - - -
05/31/87 - - - - - - - - - - - - - - - -
06/30/87 - - - - - - - - - - - - - - - -
07/31/87 - - - - - - - - - - - - - - - -
08/31/87 - - - - - - - - - - - - - - - -
09/30/87 - - - - - - - - - - - - - - - -
10/31/87 - - - - - - - - - - - - - - - -
11/30/87 - - - - - - - - - - - - - - - -
12/31/87 - - - - - - - - - - - - - - - -
01/31/88 - - - - - - - - - - - - - - - -
02/29/88 - - - - - - - - - - - - - - - -
03/31/88 - - - - - - - - - - - - - - - -
04/30/88 - - - - - - - - - - - - - - - -
05/31/88 - - - - - - - - - - - - - - - -
06/30/88 - - - - - - - - - - - - - - - -
07/31/88 - - - - - - - - - - - - - - - -
08/31/88 - - - - - - - - - - - - - - - -
09/30/88 - - - - - - - - - - - - - - - -
10/31/88 - - - - - - - - - - - - - - - -
11/30/88 - - - - - - - - - - - - - - - -
12/31/88 - - - - - - - - - - - - - - - -
01/31/89 - - - - - - - - - - - - - - - -
02/28/89 - - - - - - - - - - - - - - - -
03/31/89 - - - - - - - - - - - - - - - -
04/30/89 - - - - - - - - - - - - - - - -
05/31/89 - - - - - - - - - - - - - - - -
06/30/89 - - - - - - - - - - - - - - - -
07/31/89 - - - - - - - - - - - - - - - -
08/31/89 - - - - - - - - - - - - - - - -
09/30/89 - - - - - - - - - - - - - - - -
10/31/89 - - - - - - - - - - - - - - - -
11/30/89 - - - - - - - - - - - - - - - -
12/31/89 6.69% - - - - - - - - - - - -
01/31/90 5.59% - - - - - - - - - - - -
02/28/90 5.54% - - - - - - - - - - - -
03/31/90 5.84% - - - - - - - - - - - -
04/30/90 6.98% - - - - - - - - - - - -
05/31/90 7.72% - - - - - - - - - - - -
06/30/90 7.30% - - - - - - - - - - - -
07/31/90 7.81% - - - - - - - - - - - -
08/31/90 7.23% - - - - - - - - - - - -
09/30/90 7.98% - - - - - - - - - - - -
10/31/90 7.88% - - - - - - - - - - - -
11/30/90 7.76% - - - - - - - - - - - -
12/31/90 8.03% - - - - - - - - - - - -
01/31/91 7.19% - - - - - - - - - - - -
02/28/91 7.05% - - - - - - - - - - - -
03/31/91 7.79% - - - - - - - - - - - -
04/30/91 8.37% - - - - - - - - - - - -
05/31/91 8.81% - - - - - - - - - - - -
06/30/91 8.00% - - - - - - - - - - - -
07/31/91 8.61% - - - - - - - - - - - -
08/31/91 9.21% - - - - - - - - - - - -
09/30/91 9.18% - - - - - - - - - - - -
10/31/91 8.89% - - - - - - - - - - - -
11/30/91 9.49% - - - - - - - - - - - -
12/31/91 10.76% 7.73% - - - - - - - -
01/31/92 9.41% 6.94% - - - - - - - -
02/28/92 9.79% 6.93% - - - - - - - -
03/31/92 9.60% 6.94% - - - - - - - -
04/30/92 9.07% 7.93% - - - - - - - -
05/31/92 9.18% 8.41% - - - - - - - -
06/30/92 8.83% 8.51% - - - - - - - -
07/31/92 9.05% 9.06% - - - - - - - -
08/31/92 9.27% 9.35% - - - - - - - -
09/30/92 10.75% 10.11% - - - - - - - -
10/31/92 8.27% 9.07% - - - - - - - -
11/30/92 7.91% 8.84% - - - - - - - -
12/31/92 8.25% 8.99% - - - - - - - -
01/31/93 9.65% 8.71% - - - - - - - -
02/28/93 10.10% 8.93% - - - - - - - -
03/31/93 10.08% 9.27% - - - - - - - -
04/30/93 10.61% 9.54% - - - - - - - -
05/31/93 10.02% 9.67% - - - - - - - -
06/30/93 10.93% 9.76% - - - - - - - -
07/31/93 10.57% 9.91% - - - - - - - -
<PAGE>
<CAPTION>
=====================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
=====================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/93 8.861 0.000000 191.7630 1699.25
09/30/93 8.864 0.000000 191.7630 1699.71
10/31/93 8.902 0.000000 191.7630 1707.14
11/30/93 8.764 0.000000 191.7630 1680.63
12/31/93 8.809 0.000000 191.7630 1689.32
01/31/94 8.959 0.000000 191.7630 1717.98
02/28/94 8.726 0.000000 191.7630 1673.26
03/31/94 8.473 0.000000 191.7630 1624.86
04/30/94 8.381 0.000000 191.7630 1607.10
05/31/94 8.357 0.000000 191.7630 1602.55
06/30/94 8.320 0.000000 191.7630 1595.45
07/31/94 8.489 0.000000 191.7630 1627.95
08/31/94 8.481 0.000000 191.7630 1626.44
09/30/94 8.335 0.000000 191.7630 1598.25
10/31/94 8.316 0.000000 191.7630 1594.69
11/30/94 8.297 0.000000 191.7630 1590.97
12/31/94 8.363 0.000000 191.7630 1603.81
01/31/95 8.525 0.000000 191.7630 1634.87
02/28/95 8.714 0.000000 191.7630 1670.96
03/31/95 8.779 0.000000 191.7630 1683.44
04/30/95 8.895 0.000000 191.7630 1705.78
05/31/95 9.271 0.000000 191.7630 1777.88
06/30/95 9.330 0.000000 191.7630 1789.21
07/31/95 9.287 0.000000 191.7630 1780.92
08/31/95 9.408 0.000000 191.7630 1804.02
09/30/95 9.499 0.000000 191.7630 1821.47
10/31/95 9.639 0.000000 191.7630 1848.37
11/30/95 9.785 0.000000 191.7630 1876.41
12/31/95 9.927 0.000000 191.7630 1903.56
01/31/96 9.980 0.000000 191.7630 1913.78
02/29/96 9.733 0.000000 191.7630 1866.45
03/31/96 9.638 0.000000 191.7630 1848.29
04/30/96 9.545 0.000000 191.7630 1830.31
05/31/96 9.533 0.000000 191.7630 1828.06
06/30/96 9.658 0.000000 191.7630 1852.13
07/31/96 9.670 0.000000 191.7630 1854.30
08/31/96 9.632 0.000000 191.7630 1847.01
09/30/96 9.807 0.000000 191.7630 1880.57
10/31/96 10.041 0.000000 191.7630 1925.46
11/30/96 10.235 0.000000 191.7630 1962.76
12/31/96 10.107 0.000000 191.7630 1938.17
01/31/97 10.101 0.000000 191.7630 1937.00
02/28/97 10.102 0.000000 191.7630 1937.20
03/31/97 10.000 0.000000 191.7630 1917.63
04/30/97 10.080 0.050413 0.959063 192.7221 1942.64
05/31/97 10.110 0.052635 1.003350 193.7254 1958.56
06/30/97 10.170 0.051148 0.974304 194.6997 1980.10
07/31/97 10.380 0.052306 0.981114 195.6808 2031.17
08/31/97 10.240 0.052440 1.002100 196.6829 2014.03
09/30/97 10.340 0.051046 0.970975 197.6539 2043.74
10/31/97 10.420 0.052807 1.001680 198.6556 2069.99
11/30/97 10.380 0.051318 0.982139 199.6377 2072.24
12/31/97 10.450 0.052984 1.012211 200.6499 2096.79
<CAPTION>
=======================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
=======================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/93 2.33% 2.61% 5.16% 11.32% 10.26%
09/30/93 0.03% 2.35% 2.64% 10.04% 10.29%
10/31/93 0.44% 0.46% 2.80% 12.24% 10.77%
11/30/93 -1.55% -1.12% -1.10% 10.77% 9.05%
12/31/93 0.52% -1.04% -0.61% 9.62% 9.62%
01/31/94 1.70% 2.22% 0.64% 9.11% 1.70%
02/28/94 -2.60% -0.95% -0.44% 4.55% -0.95%
03/31/94 -2.89% -5.42% -3.82% 1.22% -3.82%
04/30/94 -1.09% -3.95% -6.45% -0.52% -4.87%
05/31/94 -0.28% -1.37% -4.23% -0.82% -5.14%
06/30/94 -0.44% -0.72% -1.81% -3.66% -5.56%
07/31/94 2.04% 1.58% 1.30% -1.97% -3.63%
08/31/94 -0.09% 1.94% 1.49% -4.29% -3.72%
09/30/94 -1.73% -1.82% 0.18% -5.97% -5.39%
10/31/94 -0.22% -1.95% -2.04% -6.59% -5.60%
11/30/94 -0.23% -0.46% -2.18% -5.33% -5.82%
12/31/94 0.81% 0.57% 0.35% -5.06% -5.06%
01/31/95 1.94% 2.76% 2.52% -4.84% 1.94%
02/28/95 2.21% 4.19% 5.03% -0.14% 4.19%
03/31/95 0.75% 2.97% 4.97% 3.61% 4.97%
04/30/95 1.33% 2.08% 4.34% 6.14% 6.36%
05/31/95 4.23% 5.61% 6.40% 10.94% 10.85%
06/30/95 0.64% 4.89% 6.28% 12.14% 11.56%
07/31/95 -0.46% 0.17% 4.41% 9.40% 11.04%
08/31/95 1.30% 0.83% 1.47% 10.92% 12.48%
09/30/95 0.97% 2.28% 1.80% 13.97% 13.57%
10/31/95 1.48% 2.46% 3.79% 15.91% 15.25%
11/30/95 1.52% 3.02% 4.01% 17.94% 17.00%
12/31/95 1.45% 2.99% 4.51% 18.69% 18.69%
01/31/96 0.54% 1.99% 3.54% 17.06% 0.54%
02/29/96 -2.47% -1.95% -0.53% 11.70% -1.95%
03/31/96 -0.97% -3.42% -2.90% 9.79% -2.90%
04/30/96 -0.97% -1.94% -4.36% 7.30% -3.85%
05/31/96 -0.12% -1.09% -2.06% 2.82% -3.97%
06/30/96 1.32% 1.19% 0.21% 3.52% -2.70%
07/31/96 0.12% 1.44% 1.31% 4.12% -2.59%
08/31/96 -0.39% -0.28% 1.04% 2.38% -2.97%
09/30/96 1.82% 1.42% 1.54% 3.25% -1.21%
10/31/96 2.39% 4.25% 3.84% 4.17% 1.15%
11/30/96 1.94% -4.37% 6.27% 4.60% 3.11%
12/31/96 -1.25% 0.66% 3.06% 1.82% 1.82%
01/31/97 -0.06% -1.31% 0.60% 1.21% -0.06%
02/28/97 0.01% -0.05% -1.30% 3.79% -0.05%
03/31/97 -1.01% -1.00% -1.06% 3.75% -1.06%
04/30/97 1.30% 0.28% 0.29% 6.14% 0.23%
05/31/97 0.82% 2.13% 1.10% 7.14% 1.05%
06/30/97 1.10% 1.93% 3.26% 6.91% 2.16%
07/31/97 2.58% 3.71% 4.56% 9.54% 4.80%
08/31/97 -0.84% 1.71% 2.83% 9.04% 3.91%
09/30/97 1.48% 0.62% 3.21% 8.68% 5.45%
10/31/97 1.28% 2.78% 1.91% 7.51% 6.80%
11/30/97 0.11% 1.39% 2.89% 5.58% 6.92%
12/31/97 1.18% 1.29% 2.60% 9.34% 8.18% 8.18%
<CAPTION>
=========================================================================================
Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
=========================================================================================
<S> <C> <C> <C> <C>
08/31/93 12.19% 10.32% - - - - - - - -
09/30/93 12.25% 9.94% - - - - - - - -
10/31/93 11.33% 9.64% - - - - - - - -
11/30/93 10.58% 9.48% - - - - - - - -
12/31/93 10.17% 9.60% - - - - - - - -
01/31/94 10.38% 9.66% - - - - - - - -
02/28/94 9.35% 9.21% - - - - - - - -
03/31/94 7.97% 8.55% - - - - - - - -
04/30/94 7.23% 7.87% - - - - - - - -
05/31/94 6.89% 7.49% - - - - - - - -
06/30/94 6.80% 6.84% - - - - - - - -
07/31/94 7.07% 6.90% - - - - - - - -
08/31/94 6.29% 6.81% - - - - - - - -
09/30/94 5.08% 7.05% - - - - - - - -
10/31/94 4.67% 5.88% - - - - - - - -
11/30/94 4.30% 5.67% - - - - - - - -
12/31/94 3.39% 5.71% - - - - - - - -
01/31/95 4.84% 6.49% - - - - - - - -
02/28/95 5.44% 6.86% - - - - - - - -
03/31/95 5.85% 6.94% - - - - - - - -
04/30/95 6.10% 7.40% - - - - - - - -
05/31/95 6.94% 7.94% - - - - - - - -
06/30/95 6.60% 8.08% - - - - - - - -
07/31/95 5.60% 7.71% - - - - - - - -
08/31/95 5.73% 8.43% - - - - - - - -
09/30/95 5.65% 8.68% - - - - - - - -
10/31/95 6.71% 8.36% - - - - - - - -
11/30/95 7.34% 8.59% - - - - - - - -
12/31/95 7.29% 8.55% - - - - - - - -
01/31/96 6.72% 8.42% - - - - - - - -
02/29/96 5.25% 7.83% - - - - - - - -
03/31/96 4.81% 7.44% - - - - - - - -
04/30/96 4.24% 7.02% - - - - - - - -
05/31/96 4.20% 6.85% - - - - - - - -
06/30/96 3.80% 7.17% - - - - - - - -
07/31/96 3.74% 6.93% - - - - - - - -
08/31/96 2.82% 6.40% - - - - - - - -
09/30/96 3.42% 6.42% - - - - - - - -
10/31/96 4.09% 6.72% - - - - - - - -
11/30/96 5.30% 6.95% - - - - - - - -
12/31/96 4.68% 5.95% 93.82% 6.84%
01/31/97 4.08% 6.42% 91.01% 6.68%
02/28/97 5.00% 6.32% 90.03% 6.63%
03/31/97 5.67% 6.19% 88.99% 6.57%
04/30/97 6.52% 6.35% 99.33% 7.14%
05/31/97 6.91% 6.14% 101.88% 7.27%
06/30/97 7.46% 6.03% 101.70% 7.26%
07/31/97 7.65% 6.07% 107.31% 7.56%
08/31/97 7.38% 5.70% 106.41% 7.51%
09/30/97 8.53% 5.76% 114.26% 7.91%
10/31/97 9.08% 6.35% 110.15% 7.70%
11/30/97 9.20% 6.43% 108.69% 7.63%
12/31/97 9.34% 6.35% 109.33% 7.66%
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
Investor Shares
<TABLE>
<CAPTION>
===============================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
===============================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/86 5.215 0.000000 191.7630 1,000.00
01/31/87 5.288 0.000000 191.7630 1,014.07
02/28/87 5.316 0.000000 191.7630 1,019.41
03/31/87 5.291 0.000000 191.7630 1,014.69
04/30/87 5.082 0.000000 191.7630 974.58
05/31/87 5.059 0.000000 191.7630 970.17
06/30/87 5.119 0.000000 191.7630 981.68
07/31/87 5.109 0.000000 191.7630 979.79
08/31/87 5.088 0.000000 191.7630 975.74
09/30/87 4.974 0.000000 191.7630 953.86
10/31/87 5.137 0.000000 191.7630 985.02
11/30/87 5.178 0.000000 191.7630 992.97
12/31/87 5.224 0.000000 191.7630 1,001.68
01/31/88 5.406 0.000000 191.7630 1,036.61
02/29/88 5.440 0.000000 191.7630 1,043.11
03/31/88 5.374 0.000000 191.7630 1,030.45
04/30/88 5.340 0.000000 191.7630 1,024.03
05/31/88 5.310 0.000000 191.7630 1,018.27
06/30/88 5.420 0.000000 191.7630 1,039.42
07/31/88 5.398 0.000000 191.7630 1,035.12
08/31/88 5.420 0.000000 191.7630 1,039.44
09/30/88 5.518 0.000000 191.7630 1,058.22
10/31/88 5.617 0.000000 191.7630 1,077.13
11/30/88 5.570 0.000000 191.7630 1,068.16
12/31/88 5.569 0.000000 191.7630 1,068.02
01/31/89 5.648 0.000000 191.7630 1,083.05
02/28/89 5.616 0.000000 191.7630 1,076.95
03/31/89 5.622 0.000000 191.7630 1,078.10
04/30/89 5.737 0.000000 191.7630 1,100.17
05/31/89 5.824 0.000000 191.7630 1,116.75
06/30/89 5.975 0.000000 191.7630 1,145.75
07/31/89 6.080 0.000000 191.7630 1,166.00
08/31/89 6.099 0.000000 191.7630 1,169.58
09/30/89 5.928 0.000000 191.7630 1,136.80
10/31/89 6.247 0.000000 191.7630 1,198.04
11/30/89 6.295 0.000000 191.7630 1,207.22
12/31/89 6.335 0.000000 191.7630 1,214.79
01/31/90 6.226 0.000000 191.7630 1,193.86
02/28/90 6.251 0.000000 191.7630 1,198.72
03/31/90 6.275 0.000000 191.7630 1,203.24
04/30/90 6.224 0.000000 191.7630 1,193.46
05/31/90 6.325 0.000000 191.7630 1,212.88
06/30/90 6.325 0.000000 191.7630 1,212.96
07/31/90 6.404 0.000000 191.7630 1,228.09
08/31/90 6.274 0.000000 191.7630 1,203.12
09/30/90 6.264 0.000000 191.7630 1,201.28
10/31/90 6.450 0.000000 191.7630 1,236.80
11/30/90 6.480 0.000000 191.7630 1,242.70
12/31/90 6.586 0.000000 191.7630 1,263.04
01/31/91 6.659 0.000000 191.7630 1,277.03
02/28/91 6.673 0.000000 191.7630 1,279.54
03/31/91 6.730 0.000000 191.7630 1,290.63
04/30/91 6.795 0.000000 191.7630 1,303.12
05/31/91 6.841 0.000000 191.7630 1,311.94
06/30/91 6.829 0.000000 191.7630 1,309.54
07/31/91 6.915 0.000000 191.7630 1,326.00
08/31/91 7.061 0.000000 191.7630 1,354.07
09/30/91 7.182 0.000000 191.7630 1,377.18
10/31/91 7.252 0.000000 191.7630 1,390.64
11/30/91 7.311 0.000000 191.7630 1,402.00
12/31/91 7.567 0.000000 191.7630 1,451.03
01/31/92 7.398 0.000000 191.7630 1,418.63
02/28/92 7.433 0.000000 191.7630 1,425.39
03/31/92 7.403 0.000000 191.7630 1,419.65
04/30/92 7.447 0.000000 191.7630 1,427.98
05/31/92 7.580 0.000000 191.7630 1,453.64
06/30/92 7.703 0.000000 191.7630 1,477.15
07/31/92 7.887 0.000000 191.7630 1,512.41
08/31/92 7.960 0.000000 191.7630 1,526.43
09/30/92 8.055 0.000000 191.7630 1,544.70
10/31/92 7.932 0.000000 191.7630 1,521.02
11/30/92 7.912 0.000000 191.7630 1,517.17
12/31/92 8.036 0.000000 191.7630 1,541.10
01/31/93 8.211 0.000000 191.7630 1,574.49
02/28/93 8.346 0.000000 191.7630 1,600.42
03/31/93 8.371 0.000000 191.7630 1,605.34
04/30/93 8.425 0.000000 191.7630 1,615.56
05/31/93 8.426 0.000000 191.7630 1,615.84
06/30/93 8.636 0.000000 191.7630 1,656.02
07/31/93 8.660 0.000000 191.7630 1,660.61
<CAPTION>
====================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 8 Months 12 Months to Date
====================================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - -
01/31/87 1.41% - - - - - - - - - 1.41%
02/28/87 0.53% 1.94% - - - - - - 1.94%
03/31/87 -0.46% 0.06% 1.47% - - - 1.47%
04/30/87 -3.95% -4.40% -3.89% - - - -2.54%
05/31/87 -0.45% -4.39% -4.83% - - - -2.98%
06/30/87 1.19% 0.73% -3.25% - - - -1.83%
07/31/87 -0.19% 0.99% 0.53% - - - -2.02%
08/31/87 -0.41% -0.61% 0.57% - - - -2.43%
09/30/87 -2.24% -2.65% -2.83% - - - -4.61%
10/31/87 3.27% 0.95% 0.53% - - - -1.50%
11/30/87 0.81% 4.10% 1.77% - - - -0.70%
12/31/87 0.88% 1.69% 5.01% 0.17% 0.17%
01/31/88 3.49% 4.39% 5.24% 2.22% 3.49%
02/29/88 0.63% 4.14% 5.05% 2.32% 4.14%
03/31/88 -1.21% -0.59% 2.87% 1.55% 2.87%
04/30/88 -0.62% -1.83% -1.21% 5.07% 2.23%
05/31/88 -0.56% -1.18% -2.38% 4.96% 1.66%
06/30/88 2.08% 1.50% 0.87% 5.88% 3.77%
07/31/88 -0.41% 1.66% 1.08% 5.65% 3.34%
08/31/88 0.42% 0.00% 2.08% 6.53% 3.77%
09/30/88 1.81% 2.23% 1.81% 10.94% 5.65%
10/31/88 1.79% 3.63% 4.06% 9.35% 7.53%
11/30/88 -0.83% 0.94% 2.76% 7.57% 6.64%
12/31/88 -0.01% -0.85% 0.93% 6.62% 6.62%
01/31/89 1.41% 1.39% 0.55% 4.48% 1.41%
02/28/89 -0.56% 0.84% 0.82% 3.24% 0.84%
03/31/89 0.11% -0.46% 0.94% 4.62% 0.94%
04/30/89 2.05% 2.16% 1.58% 7.44% 3.01%
05/31/89 1.51% 3.58% 3.70% 9.67% 4.56%
06/30/89 2.60% 4.14% 6.27% 10.23% 7.28%
07/31/89 1.77% 4.41% 5.98% 12.64% 9.17%
08/31/89 0.31% 2.08% 4.73% 12.52% 9.51%
09/30/89 -2.80% -2.50% -0.78% 7.43% 6.44%
10/31/89 5.39% 2.43% 2.75% 11.22% 12.17%
11/30/89 0.77% 6.20% 3.22% 13.02% 13.03%
12/31/89 0.63% 1.40% 6.86% 13.74% 13.74%
01/31/90 -1.72% -1.11% -0.35% 10.23% -1.72%
02/28/90 0.41% -1.32% -0.70% 11.31% -1.32%
03/31/90 0.38% 0.79% -0.95% 11.61% -0.95%
04/30/90 -0.81% -0.44% -0.03% 8.48% -1.76%
05/31/90 1.63% 0.80% 1.18% 8.61% -0.16%
06/30/90 0.01% 1.63% 0.81% 5.87% -0.15%
07/31/90 1.25% 1.25% 2.90% 5.32% 1.09%
08/31/90 -2.03% -0.81% -0.80% 2.87% -0.96%
09/30/90 -0.15% -2.18% -0.96% 5.67% -1.11%
10/31/90 2.96% 2.80% 0.71% 3.24% 1.81%
11/30/90 0.48% 3.45% 3.29% 2.94% 2.30%
12/31/90 1.64% 2.12% 5.14% 3.97% 3.97%
01/31/91 1.11% 2.76% 3.25% 6.97% 1.11%
02/28/91 0.20% 1.31% 2.96% 6.74% 1.31%
03/31/91 0.87% 1.07% 2.18% 7.26% 2.18%
04/30/91 0.97% 1.84% 2.04% 9.19% 3.17%
05/31/91 0.68% 1.65% 2.53% 8.17% 3.87%
06/30/91 -0.18% 0.49% 1.46% 7.96% 3.68%
07/31/91 1.26% 1.07% 1.76% 7.97% 4.98%
08/31/91 2.12% 3.40% 3.21% 12.55% 7.21%
09/30/91 1.71% 3.86% 5.17% 14.64% 9.04%
10/31/91 0.98% 2.70% 4.87% 12.44% 10.10%
11/30/91 0.82% 1.80% 3.54% 12.82% 11.00%
12/31/91 3.50% 4.34% 5.36% 14.88% 14.88%
01/31/92 -2.23% 1.19% 2.01% 11.09% -2.23%
02/28/92 0.48% -1.77% 1.67% 11.40% -1.77%
03/31/92 -0.40% 0.07% -2.16% 10.00% -2.16%
04/30/92 0.59% 0.18% 0.66% 9.58% -1.59%
05/31/92 1.80% 2.39% 1.98% 10.80% 0.18%
06/30/92 1.62% 3.44% 4.05% 12.80% 1.80%
07/31/92 2.39% 4.04% 5.91% 14.06% 4.23%
08/31/92 0.93% 3.34% 5.01% 12.73% 5.20%
09/30/92 1.20% 2.14% 4.57% 12.16% 6.46%
10/31/92 -1.53% -0.35% 0.57% 9.38% 4.82%
11/30/92 -0.25% -1.78% -0.61% 8.21% 4.56%
12/31/92 1.58% 1.32% -0.23% 6.21% 6.21%
01/31/93 2.17% 3.78% 3.52% 10.99% 2.17%
02/28/93 1.65% 3.85% 5.49% 12.28% 3.85%
03/31/93 0.31% 1.96% 4.17% 13.08% 4.17%
04/30/93 0.64% 0.95% 2.61% 13.14% 4.83%
05/31/93 0.02% 0.65% 0.96% 11.16% 4.85%
06/30/93 2.49% 2.50% 3.16% 12.11% 7.46%
07/31/93 0.28% 2.77% 2.79% 9.80% 7.76%
<CAPTION>
=========================================================================================
Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
=========================================================================================
<S> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - - -
01/31/87 - - - - - - - - - - - - - - - -
02/28/87 - - - - - - - - - - - - - - - -
03/31/87 - - - - - - - - - - - - - - - -
04/30/87 - - - - - - - - - - - - - - - -
05/31/87 - - - - - - - - - - - - - - - -
06/30/87 - - - - - - - - - - - - - - - -
07/31/87 - - - - - - - - - - - - - - - -
08/31/87 - - - - - - - - - - - - - - - -
09/30/87 - - - - - - - - - - - - - - - -
10/31/87 - - - - - - - - - - - - - - - -
11/30/87 - - - - - - - - - - - - - - - -
12/31/87 - - - - - - - - - - - - - - - -
01/31/88 - - - - - - - - - - - - - - - -
02/29/88 - - - - - - - - - - - - - - - -
03/31/88 - - - - - - - - - - - - - - - -
04/30/88 - - - - - - - - - - - - - - - -
05/31/88 - - - - - - - - - - - - - - - -
06/30/88 - - - - - - - - - - - - - - - -
07/31/88 - - - - - - - - - - - - - - - -
08/31/88 - - - - - - - - - - - - - - - -
09/30/88 - - - - - - - - - - - - - - - -
10/31/88 - - - - - - - - - - - - - - - -
11/30/88 - - - - - - - - - - - - - - - -
12/31/88 - - - - - - - - - - - - - - - -
01/31/89 - - - - - - - - - - - - - - - -
02/28/89 - - - - - - - - - - - - - - - -
03/31/89 - - - - - - - - - - - - - - - -
04/30/89 - - - - - - - - - - - - - - - -
05/31/89 - - - - - - - - - - - - - - - -
06/30/89 - - - - - - - - - - - - - - - -
07/31/89 - - - - - - - - - - - - - - - -
08/31/89 - - - - - - - - - - - - - - - -
09/30/89 - - - - - - - - - - - - - - - -
10/31/89 - - - - - - - - - - - - - - - -
11/30/89 - - - - - - - - - - - - - - - -
12/31/89 6.69% - - - - - - - - - - - -
01/31/90 5.59% - - - - - - - - - - - -
02/28/90 5.54% - - - - - - - - - - - -
03/31/90 5.84% - - - - - - - - - - - -
04/30/90 6.98% - - - - - - - - - - - -
05/31/90 7.72% - - - - - - - - - - - -
06/30/90 7.30% - - - - - - - - - - - -
07/31/90 7.81% - - - - - - - - - - - -
08/31/90 7.23% - - - - - - - - - - - -
09/30/90 7.98% - - - - - - - - - - - -
10/31/90 7.88% - - - - - - - - - - - -
11/30/90 7.76% - - - - - - - - - - - -
12/31/90 8.03% - - - - - - - - - - - -
01/31/91 7.19% - - - - - - - - - - - -
02/28/91 7.05% - - - - - - - - - - - -
03/31/91 7.79% - - - - - - - - - - - -
04/30/91 8.37% - - - - - - - - - - - -
05/31/91 8.81% - - - - - - - - - - - -
06/30/91 8.00% - - - - - - - - - - - -
07/31/91 8.61% - - - - - - - - - - - -
08/31/91 9.21% - - - - - - - - - - - -
09/30/91 9.18% - - - - - - - - - - - -
10/31/91 8.89% - - - - - - - - - - - -
11/30/91 9.49% - - - - - - - - - - - -
12/31/91 10.76% 7.73% - - - - - - - -
01/31/92 9.41% 6.94% - - - - - - - -
02/28/92 9.79% 6.93% - - - - - - - -
03/31/92 9.60% 6.94% - - - - - - - -
04/30/92 9.07% 7.93% - - - - - - - -
05/31/92 9.18% 8.41% - - - - - - - -
06/30/92 8.83% 8.51% - - - - - - - -
07/31/92 9.05% 9.06% - - - - - - - -
08/31/92 9.27% 9.35% - - - - - - - -
09/30/92 10.75% 10.11% - - - - - - - -
10/31/92 8.27% 9.07% - - - - - - - -
11/30/92 7.91% 8.84% - - - - - - - -
12/31/92 8.25% 8.99% - - - - - - - -
01/31/93 9.65% 8.71% - - - - - - - -
02/28/93 10.10% 8.93% - - - - - - - -
03/31/93 10.08% 9.27% - - - - - - - -
04/30/93 10.61% 9.54% - - - - - - - -
05/31/93 10.02% 9.67% - - - - - - - -
06/30/93 10.93% 9.76% - - - - - - - -
07/31/93 10.57% 9.91% - - - - - - - -
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
Investor Shares
<TABLE>
<CAPTION>
===============================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
===============================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/93 8.861 0.000000 191.7630 1,699.25
09/30/93 8.864 0.000000 191.7630 1,699.71
10/31/93 8.902 0.000000 191.7630 1,707.14
11/30/93 8.764 0.000000 191.7630 1,680.63
12/31/93 8.809 0.000000 191.7630 1,689.32
01/31/94 8.959 0.000000 191.7630 1,717.98
02/28/94 8.726 0.000000 191.7630 1,673.26
03/31/94 8.473 0.000000 191.7630 1,624.86
04/30/94 8.381 0.000000 191.7630 1,607.10
05/31/94 8.357 0.000000 191.7630 1,602.55
06/30/94 8.320 0.000000 191.7630 1,595.45
07/31/94 8.489 0.000000 191.7630 1,627.95
08/31/94 8.481 0.000000 191.7630 1,626.44
09/30/94 8.335 0.000000 191.7630 1,598.25
10/31/94 8.316 0.000000 191.7630 1,594.69
11/30/94 8.297 0.000000 191.7630 1,590.97
12/31/94 8.363 0.000000 191.7630 1,603.81
01/31/95 8.525 0.000000 191.7630 1,634.87
02/28/95 8.714 0.000000 191.7630 1,670.96
03/31/95 8.779 0.000000 191.7630 1,683.44
04/30/95 8.895 0.000000 191.7630 1,705.78
05/31/95 9.271 0.000000 191.7630 1,777.88
06/30/95 9.330 0.000000 191.7630 1,789.21
07/31/95 9.287 0.000000 191.7630 1,780.92
08/31/95 9.408 0.000000 191.7630 1,804.02
09/30/95 9.499 0.000000 191.7630 1,821.47
10/31/95 9.639 0.000000 191.7630 1,848.37
11/30/95 9.785 0.000000 191.7630 1,876.41
12/31/95 9.927 0.000000 191.7630 1,903.56
01/31/96 9.980 0.000000 191.7630 1,913.78
02/29/96 9.733 0.000000 191.7630 1,866.45
03/31/96 9.638 0.000000 191.7630 1,848.29
04/30/96 9.545 0.000000 191.7630 1,830.31
05/31/96 9.533 0.000000 191.7630 1,828.06
06/30/96 9.658 0.000000 191.7630 1,852.13
07/31/96 9.670 0.000000 191.7630 1,854.30
08/31/96 9.632 0.000000 191.7630 1,847.01
09/30/96 9.807 0.000000 191.7630 1,880.57
10/31/96 10.041 0.000000 191.7630 1,925.46
11/30/96 10.235 0.000000 191.7630 1,962.76
12/31/96 10.107 0.000000 191.7630 1,938.17
01/31/97 10.101 0.000000 191.7630 1,937.00
02/28/97 10.102 0.000000 191.7630 1,937.20
03/31/97 10.000 0.000000 191.7630 1,917.63
04/30/97 10.080 0.050413 0.959063 192.7221 1,942.64
05/31/97 10.110 0.051116 0.974400 193.6965 1,958.27
06/30/97 10.170 0.048758 0.928638 194.6251 1,979.34
07/31/97 10.390 0.050242 0.941131 195.5662 2,031.93
08/31/97 10.240 0.050340 0.961407 196.5276 2,012.44
09/30/97 10.340 0.048954 0.930446 197.4581 2,041.72
10/31/97 10.430 0.050507 0.956186 198.4143 2,069.46
11/30/97 10.390 0.048995 0.935641 199.3499 2,071.25
12/31/97 10.450 0.050599 0.965254 200.3152 2,093.29
<CAPTION>
====================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 8 Months 12 Months to Date
====================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/93 2.33% 2.61% 5.16% 11.32% 10.26%
09/30/93 0.03% 2.35% 2.64% 10.04% 10.29%
10/31/93 0.44% 0.46% 2.80% 12.24% 10.77%
11/30/93 -1.55% -1.12% -1.10% 10.77% 9.05%
12/31/93 0.52% -1.04% -0.61% 9.62% 9.62%
01/31/94 1.70% 2.22% 0.64% 9.11% 1.70%
02/28/94 -2.60% -0.95% -0.44% 4.55% -0.95%
03/31/94 -2.89% -5.42% -3.82% 1.22% -3.82%
04/30/94 -1.09% -3.95% -6.45% -0.52% -4.87%
05/31/94 -0.28% -1.37% -4.23% -0.82% -5.14%
06/30/94 -0.44% -0.72% -1.81% -3.66% -5.56%
07/31/94 2.04% 1.58% 1.30% -1.97% -3.63%
08/31/94 -0.09% 1.94% 1.49% -4.29% -3.72%
09/30/94 -1.73% -1.82% 0.18% -5.97% -5.39%
10/31/94 -0.22% -1.95% -2.04% -6.59% -5.60%
11/30/94 -0.23% -0.46% -2.18% -5.33% -5.82%
12/31/94 0.81% 0.57% 0.35% -5.06% -5.06%
01/31/95 1.94% 2.76% 2.52% -4.84% 1.94%
02/28/95 2.21% 4.19% 5.03% -0.14% 4.19%
03/31/95 0.75% 2.97% 4.97% 3.61% 4.97%
04/30/95 1.33% 2.08% 4.34% 6.14% 6.36%
05/31/95 4.23% 5.61% 6.40% 10.94% 10.85%
06/30/95 0.64% 4.89% 6.28% 12.14% 11.56%
07/31/95 -0.46% 0.17% 4.41% 9.40% 11.04%
08/31/95 1.30% 0.83% 1.47% 10.92% 12.48%
09/30/95 0.97% 2.28% 1.80% 13.97% 13.57%
10/31/95 1.48% 2.46% 3.79% 15.91% 15.25%
11/30/95 1.52% 3.02% 4.01% 17.94% 17.00%
12/31/95 1.45% 2.99% 4.51% 18.69% 18.69%
01/31/96 0.54% 1.99% 3.54% 17.06% 0.54%
02/29/96 -2.47% -1.95% -0.53% 11.70% -1.95%
03/31/96 -0.97% -3.42% -2.90% 9.79% -2.90%
04/30/96 -0.97% -1.94% -4.36% 7.30% -3.85%
05/31/96 -0.12% -1.09% -2.06% 2.82% -3.97%
06/30/96 1.32% 1.19% 0.21% 3.52% -2.70%
07/31/96 0.12% 1.44% 1.31% 4.12% -2.59%
08/31/96 -0.39% -0.28% 1.04% 2.38% -2.97%
09/30/96 1.82% 1.42% 1.54% 3.25% -1.21%
10/31/96 2.39% 4.25% 3.84% 4.17% 1.15%
11/30/96 1.94% 4.37% 6.27% 4.60% 3.11%
12/31/96 -1.25% 0.66% 3.06% 1.82% 1.82%
01/31/97 -0.06% -1.31% 0.60% 1.21% -0.06%
02/28/97 0.01% -0.05% -1.30% 3.79% -0.05%
03/31/97 -1.01% -1.00% -1.06% 3.75% -1.06%
04/30/97 1.30% 0.28% 0.29% 6.14% 0.23%
05/31/97 0.80% 2.12% 1.09% 7.12% 1.04%
06/30/97 1.08% 1.89% 3.22% 6.87% 2.12%
07/31/97 2.66% 3.76% 4.60% 9.58% 4.84%
08/31/97 -0.96% 1.67% 2.77% 8.96% 3.83%
09/30/97 1.45% 0.48% 3.15% 8.57% 5.34%
10/31/97 1.36% 2.83% 1.85% 7.48% 6.77%
11/30/97 0.09% 1.45% 2.92% 5.53% 6.87%
12/31/97 1.06% 1.15% 2.53% 7.76% 8.00% 8.00%
<CAPTION>
=========================================================================================
Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
=========================================================================================
<S> <C> <C> <C> <C>
08/31/93 12.19% 10.32% - - - - - - - -
09/30/93 12.25% 9.94% - - - - - - - -
10/31/93 11.33% 9.64% - - - - - - - -
11/30/93 10.58% 9.48% - - - - - - - -
12/31/93 10.17% 9.60% - - - - - - - -
01/31/94 10.38% 9.66% - - - - - - - -
02/28/94 9.35% 9.21% - - - - - - - -
03/31/94 7.97% 8.55% - - - - - - - -
04/30/94 7.23% 7.87% - - - - - - - -
05/31/94 6.89% 7.49% - - - - - - - -
06/30/94 6.80% 6.84% - - - - - - - -
07/31/94 7.07% 6.90% - - - - - - - -
08/31/94 6.29% 6.81% - - - - - - - -
09/30/94 5.08% 7.05% - - - - - - - -
10/31/94 4.67% 5.88% - - - - - - - -
11/30/94 4.30% 5.67% - - - - - - - -
12/31/94 3.39% 5.71% - - - - - - - -
01/31/95 4.84% 6.49% - - - - - - - -
02/28/95 5.44% 6.86% - - - - - - - -
03/31/95 5.85% 6.94% - - - - - - - -
04/30/95 6.10% 7.40% - - - - - - - -
05/31/95 6.94% 7.94% - - - - - - - -
06/30/95 6.60% 8.08% - - - - - - - -
07/31/95 5.60% 7.71% - - - - - - - -
08/31/95 5.73% 8.43% - - - - - - - -
09/30/95 5.65% 8.68% - - - - - - - -
10/31/95 6.71% 8.36% - - - - - - - -
11/30/95 7.34% 8.59% - - - - - - - -
12/31/95 7.29% 8.55% - - - - - - - -
01/31/96 6.72% 8.42% - - - - - - - -
02/29/96 5.25% 7.83% - - - - - - - -
03/31/96 4.81% 7.44% - - - - - - - -
04/30/96 4.24% 7.02% - - - - - - - -
05/31/96 4.20% 6.85% - - - - - - - -
06/30/96 3.80% 7.17% - - - - - - - -
07/31/96 3.74% 6.93% - - - - - - - -
08/31/96 2.82% 6.40% - - - - - - - -
09/30/96 3.42% 6.42% - - - - - - - -
10/31/96 4.09% 6.72% - - - - - - - -
11/30/96 5.30% 6.95% - - - - - - - -
12/31/96 4.68% 5.95% 93.82% 6.84%
01/31/97 4.08% 6.42% 91.01% 6.68%
02/28/97 5.00% 6.32% 90.03% 6.63%
03/31/97 5.67% 6.19% 88.99% 6.57%
04/30/97 6.52% 6.35% 99.33% 7.14%
05/31/97 6.90% 6.14% 101.85% 7.27%
06/30/97 7.44% 6.02% 101.63% 7.26%
07/31/97 7.66% 6.08% 107.38% 7.56%
08/31/97 7.35% 5.68% 106.25% 7.50%
09/30/97 8.50% 5.73% 114.05% 7.90%
10/31/97 9.07% 6.35% 110.09% 7.70%
11/30/97 9.18% 6.42% 108.59% 7.62%
12/31/97 9.28% 6.31% 108.98% 7.64%
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE N.Y. TAX-EXEMPT FUND
INSTITUTIONAL SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
<TABLE>
<CAPTION>
=================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
=================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 10.00 100.0000 1,000.00
08/31/92 9.91 0.017481 0.176393 100.1764 992.75
09/30/92 9.93 0.030440 0.307082 100.4835 997.80
10/31/92 9.85 0.032700 0.333585 100.8171 993.05
11/30/92 9.93 0.032300 0.327935 101.1450 1,004.37
12/31/92 9.97 0.033500 0.339855 101.4849 1,011.80
01/31/93 10.05 0.034150 0.344847 101.8297 1,023.39
02/28/93 10.24 0.029352 0.291885 102.1216 1,045.73
03/31/93 10.11 0.031011 0.313242 102.4348 1,035.62
04/30/93 10.15 0.030865 0.311493 102.7463 1,042.87
05/31/93 10.14 0.031873 0.322958 103.0693 1,045.12
06/30/93 10.24 0.032522 0.327345 103.3966 1,058.78
07/31/93 10.17 0.032888 0.334370 103.7310 1,054.94
08/31/93 10.30 0.032908 0.331416 104.0624 1,071.84
09/30/93 10.36 0.031663 0.318045 104.3804 1,081.38
10/31/93 10.34 0.032364 0.326713 104.7071 1,082.67
11/30/93 10.26 0.031233 0.318744 105.0258 1,077.56
12/31/93 10.37 0.033473 0.339008 105.3648 1,092.63
- -------------------------------------------------------------------------------------------------
01/31/94 10.44 0.032969 0.332737 105.6975 1,103.48
02/28/94 10.20 0.029926 0.310105 106.0076 1,081.28
03/31/94 9.94 0.033120 0.353215 106.3608 1,057.23
04/30/94 9.94 0.032815 0.351130 106.7119 1,060.72
05/31/94 9.98 0.033968 0.363205 107.0751 1,068.61
06/30/94 9.92 0.032575 0.351610 107.4267 1,065.67
07/31/94 9.99 0.032101 0.345196 107.7719 1,076.64
08/31/94 9.99 0.032275 0.348182 108.1201 1,080.12
09/30/94 9.84 0.031537 0.346523 108.4666 1,067.31
10/31/94 9.70 0.032883 0.367702 108.8343 1,055.69
11/30/94 9.51 0.032393 0.370712 109.2050 1,038.54
12/31/94 9.59 0.033864 0.385622 109.5906 1,050.97
- -------------------------------------------------------------------------------------------------
01/31/95 9.70 0.033880 0.382776 109.9734 1,066.74
02/28/95 9.91 0.030492 0.338376 110.3118 1,093.19
03/31/95 9.97 0.033754 0.373467 110.6853 1,103.53
04/30/95 9.98 0.032787 0.363631 111.0489 1,108.27
05/31/95 10.17 0.033439 0.365129 111.4140 1,133.08
06/30/95 10.14 0.031943 0.350976 111.7650 1,133.30
07/31/95 10.19 0.032864 0.360458 112.1255 1,142.56
08/31/95 10.25 0.032917 0.360081 112.4856 1,152.98
09/30/95 10.24 0.031855 0.349925 112.8355 1,155.44
10/31/95 10.26 0.033137 0.364428 113.1999 1,161.43
11/30/95 10.31 0.032197 0.353511 113.5534 1,170.74
12/31/95 10.34 0.033237 0.365007 113.9184 1,177.92
- -------------------------------------------------------------------------------------------------
01/31/96 10.38 0.033527 0.367952 114.2864 1,186.29
02/29/96 10.34 0.031274 0.345667 114.6321 1,185.30
03/31/96 10.22 0.033406 0.374697 115.0068 1,175.37
04/30/96 10.17 0.032508 0.367615 115.3744 1,173.36
05/31/96 10.13 0.033666 0.383435 115.7578 1,172.63
06/30/96 10.14 0.032830 0.374786 116.1326 1,177.58
07/31/96 10.21 0.033848 0.385001 116.5176 1,189.64
08/31/96 10.18 0.033850 0.387438 116.9050 1,190.09
09/30/96 10.21 0.033172 0.379821 117.2848 1,197.48
10/31/96 10.26 0.034425 0.393521 117.6783 1,207.38
11/30/96 10.35 0.033330 0.378958 118.0573 1,221.89
12/31/96 10.29 0.033933 0.389314 118.4466 1,218.82
- -------------------------------------------------------------------------------------------------
01/31/97 10.27 0.035127 0.405129 118.8517 1,220.61
02/28/97 10.31 0.031423 0.362238 119.2139 1,229.10
03/31/97 10.16 0.035374 0.415066 119.6290 1,215.43
04/30/97 10.16 0.034006 0.400404 120.0294 1,219.50
05/31/97 10.25 0.035436 0.414962 120.4444 1,234.56
06/30/97 10.31 0.034192 0.399441 120.8438 1,245.90
07/31/97 10.48 0.035148 0.405288 121.2491 1,270.69
08/31/97 10.37 0.034852 0.407500 121.6566 1,261.58
09/30/97 10.44 0.033800 0.393869 122.0505 1,274.21
10/31/97 10.44 0.034836 0.407256 122.4578 1,278.46
11/30/97 10.44 0.033837 0.396897 122.8547 1,282.60
12/31/97 10.52 0.034880 0.407336 123.2620 1,296.72
- -------------------------------------------------------------------------------------------------
<CAPTION>
=========================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
=========================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - -
08/31/92 -0.73% - - - - - - - - - - - -
09/30/92 0.51% - - - - - - - - - - - -
10/31/92 -0.48% 0.03% -0.70% - - - - - -
11/30/92 1.14% 0.66% 1.17% - - - - - -
12/31/92 0.74% 1.88% 1.40% - - - - - -
01/31/93 1.15% 1.92% 3.06% - - - - - -
02/28/93 2.18% 3.38% 4.12% - - - - - -
03/31/93 -0.97% 1.21% 2.35% - - - - - -
04/30/93 0.70% -0.28% 1.90% - - - 3.07%
05/31/93 0.22% 0.91% -0.06% - - - 3.29%
06/30/93 1.31% 1.54% 2.24% - - - 4.64%
07/31/93 -0.36% 0.94% 1.16% 5.49% 4.26%
08/31/93 1.60% 1.25% 2.56% 7.97% 5.93%
09/30/93 0.89% 2.50% 2.13% 8.38% 6.88%
10/31/93 0.12% 1.03% 2.63% 9.02% 7.00%
11/30/93 -0.47% -0.36% 0.53% 7.29% 6.50%
12/31/93 1.40% 0.92% 1.04% 7.99% 7.99%
- ---------------------------------------------------------------------------------------------------------
01/31/94 0.99% 2.39% 1.92% 7.83% 0.99%
02/28/94 -2.01% -1.05% 0.35% 3.40% -1.04%
03/31/94 -2.22% -4.23% -3.24% 2.09% -3.24%
04/30/94 0.33% -1.86% -3.88% 1.71% -2.92%
05/31/94 0.74% 1.05% -1.17% 2.25% -2.20%
06/30/94 -0.28% 0.47% 0.80% 0.65% -2.47%
07/31/94 1.03% 0.76% 1.50% 2.06% -1.46%
08/31/94 0.32% 1.35% 1.08% 0.77% -1.14%
09/30/94 -1.19% -0.88% 0.15% -1.30% -2.32%
10/31/94 -1.09% -2.27% -1.95% -2.49% -3.38%
11/30/94 -1.62% -2.66% -3.85% -3.62% -4.95%
12/31/94 1.20% -0.44% -1.53% -3.81% -3.81%
- ---------------------------------------------------------------------------------------------------------
01/31/95 1.50% 2.67% 1.05% -3.33% 1.50%
02/28/95 2.48% 4.07% 5.26% 1.10% 4.02%
03/31/95 0.95% 3.50% 5.00% 4.38% 5.00%
04/30/95 0.43% 1.41% 3.89% 4.48% 5.45%
05/31/95 2.24% 2.70% 3.65% 6.03% 7.81%
06/30/95 0.02% 2.27% 2.70% 6.35% 7.83%
07/31/95 0.82% 0.86% 3.09% 6.12% 8.71%
08/31/95 0.91% 1.74% 1.76% 6.75% 9.71%
09/30/95 0.21% 1.14% 1.95% 8.26% 9.94%
10/31/95 0.52% 0.74% 1.65% 10.02% 10.51%
11/30/95 0.80% 1.33% 1.54% 12.73% 11.40%
12/31/95 0.61% 1.43% 1.95% 12.08% 12.08%
- ---------------------------------------------------------------------------------------------------------
01/31/96 0.71% 1.34% 2.14% 11.21% 0.71%
02/29/96 -0.08% 0.63% 1.24% 8.43% 0.63%
03/31/96 -0.84% -0.93% -0.22% 6.51% -0.22%
04/30/96 -0.17% -1.01% -1.09% 5.87% -0.39%
05/31/96 -0.06% -0.23% -1.07% 3.49% -0.45%
06/30/96 0.42% 0.36% 0.19% 3.91% -0.03%
07/31/96 1.02% 1.45% 1.39% 4.12% 0.99%
08/31/96 0.04% 1.07% 1.49% 3.22% 1.03%
09/30/96 0.62% 0.67% 1.69% 3.64% 1.66%
10/31/96 0.83% 1.45% 1.49% 3.96% 2.50%
11/30/96 1.20% 2.05% 2.67% 4.37% 3.73%
12/31/96 -0.25% 0.96% 1.78% 3.47% 3.47%
- ---------------------------------------------------------------------------------------------------------
01/31/97 0.15% -0.11% 1.10% 2.89% 0.15%
02/28/97 0.70% 0.84% 0.59% 3.70% 0.84%
03/31/97 -1.11% -0.43% -0.28% 3.41% -0.28%
04/30/97 0.33% -0.79% -0.09% 3.93% 0.06%
05/31/97 1.23% 1.56% 0.44% 5.28% 1.29%
06/30/97 0.92% 2.17% 2.51% 5.80% 2.22%
07/31/97 1.99% 2.96% 4.20% 6.81% 4.26%
08/31/97 -0.72% 1.27% 2.19% 6.01% 3.51%
09/30/97 1.00% 0.28% 2.27% 6.41% 4.54%
10/31/97 0.33% 1.33% 0.61% 5.89% 4.89%
11/30/97 0.32% 0.67% 1.67% 4.97% 5.23%
12/31/97 1.10% 1.43% 1.77% 6.69% 6.39% 6.39%
- ---------------------------------------------------------------------------------------------------------
<CAPTION>
================================================================================================================
Trailing Trailing 3 Yr Trailing Trailing 5 Yr Total Since Avg.Ann.Rtn.
Date 3 Years Avg.Ann.Rtn. 5 Years Avg.Ann.Rtn. Inception Since Inc.
================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - - - - - - - - - - -
08/31/92 - - - - - - - - - - - - - - - - -0.73% - - - -
09/30/92 - - - - - - - - - - - - - - - - -0.22% - - - -
10/31/92 - - - - - - - - - - - - - - - - -0.70% - - - -
11/30/92 - - - - - - - - - - - - - - - - 0.44% - - - -
12/31/92 - - - - - - - - - - - - - - - - 1.18% - - - -
01/31/93 - - - - - - - - - - - - - - - - 2.34% 4.94%
02/28/93 - - - - - - - - - - - - - - - - 4.57% 8.37%
03/31/93 - - - - - - - - - - - - - - - - 3.56% 5.61%
04/30/93 - - - - - - - - - - - - - - - - 4.29% 5.98%
05/31/93 - - - - - - - - - - - - - - - - 4.51% 5.61%
06/30/93 - - - - - - - - - - - - - - - - 5.88% 6.62%
07/31/93 - - - - - - - - - - - - - - - - 5.49% 5.64%
08/31/93 - - - - - - - - - - - - - - - - 7.18% 6.76%
09/30/93 - - - - - - - - - - - - - - - - 8.14% 7.09%
10/31/93 - - - - - - - - - - - - - - - - 8.27% 6.69%
11/30/93 - - - - - - - - - - - - - - - - 7.76% 5.87%
12/31/93 - - - - - - - - - - - - - - - - 9.26% 6.56%
- ----------------------------------------------------------------------------------------------------------------
01/31/94 - - - - - - - - - - - - - - - - 10.35% 6.88%
02/28/94 - - - - - - - - - - - - - - - - 8.13% 5.15%
03/31/94 - - - - - - - - - - - - - - - - 5.72% 3.45%
04/30/94 - - - - - - - - - - - - - - - - 6.07% 3.48%
05/31/94 - - - - - - - - - - - - - - - - 6.86% 3.74%
06/30/94 - - - - - - - - - - - - - - - - 6.57% 3.42%
07/31/94 - - - - - - - - - - - - - - - - 7.66% 3.81%
08/31/94 - - - - - - - - - - - - - - - - 8.01% 3.81%
09/30/94 - - - - - - - - - - - - - - - - 6.73% 3.09%
10/31/94 - - - - - - - - - - - - - - - - 5.57% 2.46%
11/30/94 - - - - - - - - - - - - - - - - 3.85% 1.65%
12/31/94 - - - - - - - - - - - - - - - - 5.10% 2.10%
- ----------------------------------------------------------------------------------------------------------------
01/31/95 - - - - - - - - - - - - - - - - 6.67% 2.64%
02/28/95 - - - - - - - - - - - - - - - - 9.32% 3.55%
03/31/95 - - - - - - - - - - - - - - - - 10.35% 3.80%
04/30/95 - - - - - - - - - - - - - - - - 10.83% 3.85%
05/31/95 - - - - - - - - - - - - - - - - 13.31% 4.55%
06/30/95 - - - - - - - - - - - - - - - - 13.33% 4.42%
07/31/95 - - - - - - - - - - - - - - - - 14.26% 4.58%
08/31/95 16.14% 5.11% - - - - - - - - 15.30% 4.76%
09/30/95 15.80% 5.01% - - - - - - - - 15.54% 4.71%
10/31/95 16.96% 5.36% - - - - - - - - 16.14% 4.75%
11/30/95 16.56% 5.24% - - - - - - - - 17.07% 4.88%
12/31/95 16.42% 5.20% - - - - - - - - 17.79% 4.94%
- ----------------------------------------------------------------------------------------------------------------
01/31/96 15.92% 5.05% - - - - - - - - 18.63% 5.03%
02/29/96 13.35% 4.26% - - - - - - - - 18.53% 4.89%
03/31/96 13.49% 4.31% - - - - - - - - 17.54% 4.53%
04/30/96 12.51% 4.00% - - - - - - - - 17.34% 4.38%
05/31/96 12.20% 3.91% - - - - - - - - 17.26% 4.27%
06/30/96 11.22% 3.61% - - - - - - - - 17.76% 4.29%
07/31/96 12.77% 4.08% - - - - - - - - 18.96% 4.46%
08/31/96 11.03% 3.55% - - - - - - - - 19.01% 4.38%
09/30/96 10.74% 3.45% - - - - - - - - 19.75% 4.44%
10/31/96 11.52% 3.70% - - - - - - - - 20.74% 4.56%
11/30/96 13.39% 4.28% - - - - - - - - 22.19% 4.76%
12/31/96 11.55% 3.71% - - - - - - - - 21.88% 4.60%
- ----------------------------------------------------------------------------------------------------------------
01/31/97 10.61% 3.42% - - - - - - - - 22.06% 4.55%
02/28/97 13.67% 4.36% - - - - - - - - 22.91% 4.63%
03/31/97 14.96% 4.75% - - - - - - - - 21.54% 4.29%
04/30/97 14.97% 4.76% - - - - - - - - 21.95% 4.29%
05/31/97 15.53% 4.92% - - - - - - - - 23.46% 4.48%
06/30/97 16.91% 5.34% - - - - - - - - 24.59% 4.60%
07/31/97 18.02% 5.67% - - - - - - - - 27.07% 4.93%
08/31/97 16.80% 5.31% 27.08% 4.91% 26.16% 4.70%
09/30/97 19.39% 6.08% 27.70% 5.01% 27.42% 4.82%
10/31/97 21.10% 6.58% 28.74% 5.18% 27.85% 4.81%
11/30/97 23.50% 7.28% 27.70% 5.01% 28.26% 4.80%
12/31/97 23.38% 7.25% 28.16% 5.08% 29.67% 4.93%
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE N.Y. TAX-EXEMPT FUND
INVESTOR SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
<TABLE>
<CAPTION>
================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 10.00 100.0000 1000.00
08/31/92 9.91 0.017481 0.176393 100.1764 992.75
09/30/92 9.93 0.030440 0.307082 100.4835 997.80
10/31/92 9.85 0.032700 0.333585 100.8171 993.05
11/30/92 9.93 0.032300 0.327935 101.1450 1004.37
12/31/92 9.97 0.033500 0.339855 101.4849 1011.80
01/31/93 10.05 0.034150 0.344847 101.8297 1023.39
02/28/93 10.24 0.029352 0.291885 102.1216 1045.73
03/31/93 10.11 0.031011 0.313242 102.4348 1035.62
04/30/93 10.15 0.030865 0.311493 102.7463 1042.87
05/31/93 10.14 0.031873 0.322958 103.0693 1045.12
06/30/93 10.24 0.032522 0.327345 103.3966 1058.78
07/31/93 10.17 0.032888 0.334370 103.7310 1054.94
08/31/93 10.30 0.032908 0.331416 104.0624 1071.84
09/30/93 10.36 0.031663 0.318045 104.3804 1081.38
10/31/93 10.34 0.032364 0.326713 104.7071 1082.67
11/30/93 10.26 0.031233 0.318744 105.0258 1077.56
12/31/93 10.37 0.033473 0.339008 105.3648 1092.63
- --------------------------------------------------------------------------------
01/31/94 10.44 0.032969 0.332737 105.6975 1103.48
02/28/94 10.20 0.029926 0.310105 106.0076 1081.28
03/31/94 9.94 0.033120 0.353215 106.3608 1057.23
04/30/94 9.94 0.032815 0.351130 106.7119 1060.72
05/31/94 9.98 0.033968 0.363205 107.0751 1068.61
06/30/94 9.92 0.032575 0.351610 107.4267 1065.67
07/31/94 9.99 0.032101 0.345196 107.7719 1076.64
08/31/94 9.99 0.032275 0.348182 108.1201 1080.12
09/30/94 9.84 0.031537 0.346523 108.4666 1067.31
10/31/94 9.70 0.032883 0.367702 108.8343 1055.69
11/30/94 9.51 0.032393 0.370712 109.2050 1038.54
12/31/94 9.59 0.033864 0.385622 109.5906 1050.97
- --------------------------------------------------------------------------------
01/31/95 9.70 0.033880 0.382776 109.9734 1066.74
02/28/95 9.91 0.030492 0.338376 110.3118 1093.19
03/31/95 9.97 0.033754 0.373467 110.6853 1103.53
04/30/95 9.98 0.032787 0.363631 111.0489 1108.27
05/31/95 10.17 0.033439 0.365129 111.4140 1133.08
06/30/95 10.14 0.031943 0.350976 111.7650 1133.30
07/31/95 10.19 0.032864 0.360458 112.1255 1142.56
08/31/95 10.25 0.032917 0.360081 112.4856 1152.98
09/30/95 10.24 0.031855 0.349925 112.8355 1155.44
10/31/95 10.26 0.033137 0.364428 113.1999 1161.43
11/30/95 10.31 0.032197 0.353511 113.5534 1170.74
12/31/95 10.34 0.033237 0.365007 113.9184 1177.92
- --------------------------------------------------------------------------------
01/31/96 10.38 0.033527 0.367952 114.2864 1186.29
02/29/96 10.34 0.031274 0.345667 114.6321 1185.30
03/31/96 10.22 0.033406 0.374697 115.0068 1175.37
04/30/96 10.17 0.032508 0.367615 115.3744 1173.36
05/31/96 10.13 0.033666 0.383435 115.7578 1172.63
06/30/96 10.14 0.032830 0.374786 116.1326 1177.58
07/31/96 10.21 0.033848 0.385001 116.5176 1189.64
08/31/96 10.18 0.033850 0.387438 116.9050 1190.09
09/30/96 10.21 0.033172 0.379821 117.2848 1197.48
10/31/96 10.26 0.034425 0.393521 117.6783 1207.38
11/30/96 10.35 0.033330 0.378958 118.0573 1221.89
12/31/96 10.29 0.033933 0.389314 118.4466 1218.82
- --------------------------------------------------------------------------------
01/31/97 10.27 0.035127 0.405129 118.8517 1220.61
02/28/97 10.31 0.031423 0.362238 119.2139 1229.10
03/31/97 10.16 0.035374 0.415066 119.6290 1215.43
04/30/97 10.16 0.031918 0.375819 120.0048 1219.25
05/31/97 10.25 0.033249 0.389272 120.3941 1234.04
06/30/97 10.31 0.032115 0.375020 120.7691 1245.13
07/31/97 10.48 0.032911 0.379259 121.1484 1269.64
08/31/97 10.37 0.032631 0.381214 121.5296 1260.26
09/30/97 10.44 0.031647 0.368395 121.8980 1272.62
10/31/97 10.44 0.032667 0.381422 122.2794 1276.60
11/30/97 10.44 0.031689 0.371160 122.6506 1280.47
12/31/97 10.52 0.032657 0.380742 123.0313 1294.29
<CAPTION>
===================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 12 Months to Date
===================================================================================
<S> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - -
08/31/92 -0.73% - - - - - - - - - - - -
09/30/92 0.51% - - - - - - - - - - - -
10/31/92 -0.48% 0.03% -0.70% - - - - - -
11/30/92 1.14% 0.66% 1.17% - - - - - -
12/31/92 0.74% 1.88% 1.40% - - - - - -
01/31/93 1.15% 1.92% 3.06% - - - - - -
02/28/93 2.18% 3.38% 4.12% - - - - - -
03/31/93 -0.97% 1.21% 2.35% - - - - - -
04/30/93 0.70% -0.28% 1.90% - - - 3.07%
05/31/93 0.22% 0.91% -0.06% - - - 3.29%
06/30/93 1.31% 1.54% 2.24% - - - 4.64%
07/31/93 -0.36% 0.94% 1.16% 5.49% 4.26%
08/31/93 1.60% 1.25% 2.56% 7.97% 5.93%
09/30/93 0.89% 2.50% 2.13% 8.38% 6.88%
10/31/93 0.12% 1.03% 2.63% 9.02% 7.00%
11/30/93 -0.47% -0.36% 0.53% 7.29% 6.50%
12/31/93 1.40% 0.92% 1.04% 7.99% 7.99%
- -----------------------------------------------------------------------------------
01/31/94 0.99% 2.39% 1.92% 7.83% 0.99%
02/28/94 -2.01% -1.05% 0.35% 3.40% -1.04%
03/31/94 -2.22% -4.23% -3.24% 2.09% -3.24%
04/30/94 0.33% -1.86% -3.88% 1.71% -2.92%
05/31/94 0.74% 1.05% -1.17% 2.25% -2.20%
06/30/94 -0.28% 0.47% 0.80% 0.65% -2.47%
07/31/94 1.03% 0.76% 1.50% 2.06% -1.46%
08/31/94 0.32% 1.35% 1.08% 0.77% -1.14%
09/30/94 -1.19% -0.88% 0.15% -1.30% -2.32%
10/31/94 -1.09% -2.27% -1.95% -2.49% -3.38%
11/30/94 -1.62% -2.66% -3.85% -3.62% -4.95%
12/31/94 1.20% -0.44% -1.53% -3.81% -3.81%
- -----------------------------------------------------------------------------------
01/31/95 1.50% 2.67% 1.05% -3.33% 1.50%
02/28/95 2.48% 4.07% 5.26% 1.10% 4.02%
03/31/95 0.95% 3.50% 5.00% 4.38% 5.00%
04/30/95 0.43% 1.41% 3.89% 4.48% 5.45%
05/31/95 2.24% 2.70% 3.65% 6.03% 7.81%
06/30/95 0.02% 2.27% 2.70% 6.35% 7.83%
07/31/95 0.82% 0.86% 3.09% 6.12% 8.71%
08/31/95 0.91% 1.74% 1.76% 6.75% 9.71%
09/30/95 0.21% 1.14% 1.95% 8.26% 9.94%
10/31/95 0.52% 0.74% 1.65% 10.02% 10.51%
11/30/95 0.80% 1.33% 1.54% 12.73% 11.40%
12/31/95 0.61% 1.43% 1.95% 12.08% 12.08%
- -----------------------------------------------------------------------------------
01/31/96 0.71% 1.34% 2.14% 11.21% 0.71%
02/29/96 -0.08% 0.63% 1.24% 8.43% 0.63%
03/31/96 -0.84% -0.93% -0.22% 6.51% -0.22%
04/30/96 -0.17% -1.01% -1.09% 5.87% -0.39%
05/31/96 -0.06% -0.23% -1.07% 3.49% -0.45%
06/30/96 0.42% 0.36% 0.19% 3.91% -0.03%
07/31/96 1.02% 1.45% 1.39% 4.12% 0.99%
08/31/96 0.04% 1.07% 1.49% 3.22% 1.03%
09/30/96 0.62% 0.67% 1.69% 3.64% 1.66%
10/31/96 0.83% 1.45% 1.49% 3.96% 2.50%
11/30/96 1.20% 2.05% 2.67% 4.37% 3.73%
12/31/96 -0.25% 0.96% 1.78% 3.47% 3.47%
- -----------------------------------------------------------------------------------
01/31/97 0.15% -0.11% 1.10% 2.89% 0.15%
02/28/97 0.70% 0.84% 0.59% 3.70% 0.84%
03/31/97 -1.11% -0.43% -0.28% 3.41% -0.28%
04/30/97 0.31% -0.81% -0.11% 3.91% 0.04%
05/31/97 1.21% 1.51% 0.40% 5.24% 1.25%
06/30/97 0.90% 2.13% 2.44% 5.74% 2.16%
07/31/97 1.97% 2.92% 4.13% 6.72% 4.17%
08/31/97 -0.74% 1.23% 2.12% 5.90% 3.40%
09/30/97 0.98% 0.24% 2.21% 6.27% 4.41%
10/31/97 0.31% 1.29% 0.55% 5.73% 4.74%
11/30/97 0.30% 0.62% 1.60% 4.79% 5.06%
12/31/97 1.08% 1.39% 1.70% 6.19% 6.19%
<CAPTION>
============================================================================================================
Trailing Trailing 3 Yr Trailing Trailing 5 Yr Total Since Avg.Ann.Rtn.
Date 3 Years Avg.Ann.Rtn. 5 Years Avg.Ann.Rtn. Inception Since Inc.
============================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - - - - - - - - - -
08/31/92 - - - - - - - - - - - - - - - - -0.73% - - -
09/30/92 - - - - - - - - - - - - - - - - -0.22% - - -
10/31/92 - - - - - - - - - - - - - - - - -0.70% - - -
11/30/92 - - - - - - - - - - - - - - - - 0.44% - - -
12/31/92 - - - - - - - - - - - - - - - - 1.18% - - -
01/31/93 - - - - - - - - - - - - - - - - 2.34% 4.94%
02/28/93 - - - - - - - - - - - - - - - - 4.57% 8.37%
03/31/93 - - - - - - - - - - - - - - - - 3.56% 5.61%
04/30/93 - - - - - - - - - - - - - - - - 4.29% 5.98%
05/31/93 - - - - - - - - - - - - - - - - 4.51% 5.61%
06/30/93 - - - - - - - - - - - - - - - - 5.88% 6.62%
07/31/93 - - - - - - - - - - - - - - - - 5.49% 5.64%
08/31/93 - - - - - - - - - - - - - - - - 7.18% 6.76%
09/30/93 - - - - - - - - - - - - - - - - 8.14% 7.09%
10/31/93 - - - - - - - - - - - - - - - - 8.27% 6.69%
11/30/93 - - - - - - - - - - - - - - - - 7.76% 5.87%
12/31/93 - - - - - - - - - - - - - - - - 9.26% 6.56%
- -------------------------------------------------------------------------------------------------------
01/31/94 - - - - - - - - - - - - - - - - 10.35% 6.88%
02/28/94 - - - - - - - - - - - - - - - - 8.13% 5.15%
03/31/94 - - - - - - - - - - - - - - - - 5.72% 3.45%
04/30/94 - - - - - - - - - - - - - - - - 6.07% 3.48%
05/31/94 - - - - - - - - - - - - - - - - 6.86% 3.74%
06/30/94 - - - - - - - - - - - - - - - - 6.57% 3.42%
07/31/94 - - - - - - - - - - - - - - - - 7.66% 3.81%
08/31/94 - - - - - - - - - - - - - - - - 8.01% 3.81%
09/30/94 - - - - - - - - - - - - - - - - 6.73% 3.09%
10/31/94 - - - - - - - - - - - - - - - - 5.57% 2.46%
11/30/94 - - - - - - - - - - - - - - - - 3.85% 1.65%
12/31/94 - - - - - - - - - - - - - - - - 5.10% 2.10%
- -------------------------------------------------------------------------------------------------------
01/31/95 - - - - - - - - - - - - - - - - 6.67% 2.64%
02/28/95 - - - - - - - - - - - - - - - - 9.32% 3.55%
03/31/95 - - - - - - - - - - - - - - - - 10.35% 3.80%
04/30/95 - - - - - - - - - - - - - - - - 10.83% 3.85%
05/31/95 - - - - - - - - - - - - - - - - 13.31% 4.55%
06/30/95 - - - - - - - - - - - - - - - - 13.33% 4.42%
07/31/95 - - - - - - - - - - - - - - - - 14.26% 4.58%
08/31/95 16.14% 5.11% - - - - - - - - 15.30% 4.76%
09/30/95 15.80% 5.01% - - - - - - - - 15.54% 4.71%
10/31/95 16.96% 5.36% - - - - - - - - 16.14% 4.75%
11/30/95 16.56% 5.24% - - - - - - - - 17.07% 4.88%
12/31/95 16.42% 5.20% - - - - - - - - 17.79% 4.94%
- -------------------------------------------------------------------------------------------------------
01/31/96 15.92% 5.05% - - - - - - - - 18.63% 5.03%
02/29/96 13.35% 4.26% - - - - - - - - 18.53% 4.89%
03/31/96 13.49% 4.31% - - - - - - - - 17.54% 4.53%
04/30/96 12.51% 4.00% - - - - - - - - 17.34% 4.38%
05/31/96 12.20% 3.91% - - - - - - - - 17.26% 4.27%
06/30/96 11.22% 3.61% - - - - - - - - 17.76% 4.29%
07/31/96 12.77% 4.08% - - - - - - - - 18.96% 4.46%
08/31/96 11.03% 3.55% - - - - - - - - 19.01% 4.38%
09/30/96 10.74% 3.45% - - - - - - - - 19.75% 4.44%
10/31/96 11.52% 3.70% - - - - - - - - 20.74% 4.56%
11/30/96 13.39% 4.28% - - - - - - - - 22.19% 4.76%
12/31/96 11.55% 3.71% - - - - - - - - 21.88% 4.60%
- -------------------------------------------------------------------------------------------------------
01/31/97 10.61% 3.42% - - - - - - - - 22.06% 4.55%
02/28/97 13.67% 4.36% - - - - - - - - 22.91% 4.63%
03/31/97 14.96% 4.75% - - - - - - - - 21.54% 4.29%
04/30/97 14.95% 4.75% - - - - - - - - 21.93% 4.28%
05/31/97 15.48% 4.91% - - - - - - - - 23.40% 4.47%
06/30/97 16.84% 5.32% - - - - - - - - 24.51% 4.58%
07/31/97 17.93% 5.64% - - - - - - - - 26.96% 4.91%
08/31/97 16.68% 5.27% 26.95% 4.88% 26.03% 4.67%
09/30/97 19.24% 6.03% 27.54% 4.98% 27.26% 4.80%
10/31/97 20.93% 6.53% 28.55% 5.15% 27.66% 4.78%
11/30/97 23.30% 7.22% 27.49% 4.97% 28.05% 4.76%
12/31/97 23.15% 7.18% 27.92% 5.05% 29.43% 4.90%
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
Institutional Shares
<TABLE>
<CAPTION>
=================================================================================================================
Dividend Dividend Total Extended Change For/(From)
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months 3 Months 9 Months
=================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
12/31/86 5.642 0.000000 177.2385 1,000.00 - - - - - - - - -
01/31/87 5.800 0.000000 177.2385 1,027.98 2.80% - - - - - -
02/28/87 5.807 0.000000 177.2385 1,029.30 0.13% 2.93% - - -
03/31/87 5.795 0.000000 177.2385 1,027.01 -0.22% -0.09% 2.70%
04/30/87 5.460 0.000000 177.2385 967.73 -5.77% -5.98% -5.86%
05/31/87 5.433 0.000000 177.2385 962.97 -0.49% -6.24% -6.44%
06/30/87 5.551 0.000000 177.2385 983.85 2.17% 1.67% -4.20%
07/31/87 5.606 0.000000 177.2385 993.67 1.00% 3.19% 2.68%
08/31/87 5.626 0.000000 177.2385 997.22 0.36% 1.36% 3.56%
09/30/87 5.436 0.000000 177.2385 963.50 -3.38% -3.04% -2.07%
10/31/87 5.372 0.000000 177.2385 952.21 -1.17% -4.51% -4.17%
11/30/87 5.549 0.000000 177.2385 983.51 3.29% 2.08% -1.37%
12/31/87 6.379 0.000000 177.2385 1,130.53 14.95% 18.73% 17.34%
01/31/88 5.803 0.000000 177.2385 1,028.53 -9.02% 4.58% 8.02%
02/29/88 5.818 0.000000 177.2385 1,031.19 0.26% -8.79% 4.85%
03/31/88 5.747 0.000000 177.2385 1,018.59 -1.22% -0.97% -9.90%
04/30/88 5.764 0.000000 177.2385 1,021.52 0.29% -0.94% -0.68%
05/31/88 5.803 0.000000 177.2385 1,028.45 0.68% 0.97% -0.27%
06/30/88 5.851 0.000000 177.2385 1,037.06 0.84% 1.52% 1.81%
07/31/88 5.902 0.000000 177.2385 1,046.07 0.87% 1.71% 2.40%
08/31/88 5.946 0.000000 177.2385 1,053.89 0.75% 1.62% 2.47%
09/30/88 5.975 0.000000 177.2385 1,058.93 0.48% 1.23% 2.11%
10/31/88 6.058 0.000000 177.2385 1,073.63 1.39% 1.87% 2.63%
11/30/88 6.028 0.000000 177.2385 1,068.34 -0.49% 0.89% 1.37%
12/31/88 6.080 0.000000 177.2385 1,077.62 0.87% 0.37% 1.76%
01/31/89 6.158 0.000000 177.2385 1,091.39 1.28% 2.16% 1.65%
02/28/89 6.128 0.000000 177.2385 1,086.13 -0.48% 0.79% 1.66%
03/31/89 6.102 0.000000 177.2385 1,081.44 -0.43% -0.91% 0.35%
04/30/89 6.241 0.000000 177.2385 1,106.07 2.28% 1.84% 1.35%
05/31/89 6.363 0.000000 177.2385 1,127.84 1.97% 4.29% 3.84%
06/30/89 6.431 0.000000 177.2385 1,139.88 1.07% 3.06% 5.40%
07/31/89 6.477 0.000000 177.2385 1,147.95 0.71% 1.78% 3.79%
08/31/89 6.490 0.000000 177.2385 1,150.34 0.21% 0.92% 2.00%
09/30/89 6.426 0.000000 177.2385 1,138.93 -0.99% -0.79% -0.08%
10/31/89 6.475 0.000000 177.2385 1,147.68 0.77% -0.23% -0.02%
11/30/89 6.609 0.000000 177.2385 1,171.30 2.06% 2.84% 1.82%
12/31/89 6.675 0.000000 177.2385 1,182.99 1.00% 3.08% 3.87%
01/31/90 6.609 0.000000 177.2385 1,171.37 -0.98% 0.01% 2.06%
02/28/90 6.638 0.000000 177.2385 1,176.50 0.44% -0.55% 0.44%
03/31/90 6.621 0.000000 177.2385 1,173.42 -0.26% 0.17% -0.81%
04/30/90 6.550 0.000000 177.2385 1,160.96 -1.06% -1.32% -0.89%
05/31/90 6.737 0.000000 177.2385 1,194.14 2.86% 1.77% 1.50%
06/30/90 6.787 0.000000 177.2385 1,202.83 0.73% 3.61% 2.51%
07/31/90 6.856 0.000000 177.2385 1,215.07 1.02% 1.75% 4.66%
08/31/90 6.789 0.000000 177.2385 1,203.26 -0.97% 0.04% 0.76%
09/30/90 6.781 0.000000 177.2385 1,201.92 -0.11% -1.08% -0.08%
10/31/90 6.884 0.000000 177.2385 1,220.16 1.52% 1.40% 0.42%
11/30/90 7.037 0.000000 177.2385 1,247.22 2.22% 3.77% 3.65%
12/31/90 7.076 0.000000 177.2385 1,254.18 0.56% 2.79% 4.35%
01/31/91 7.121 0.000000 177.2385 1,262.19 0.64% 1.20% 3.44%
02/28/91 7.208 0.000000 177.2385 1,277.56 1.22% 1.86% 2.43%
03/31/91 7.160 0.000000 177.2385 1,268.97 -0.67% 0.54% 1.18%
04/30/91 7.230 0.000000 177.2385 1,281.51 0.99% 0.31% 1.53%
05/31/91 7.306 0.000000 177.2385 1,294.94 1.05% 2.05% 1.36%
06/30/91 7.274 0.000000 177.2385 1,289.22 -0.44% 0.60% 1.60%
07/31/91 7.355 0.000000 177.2385 1,303.50 1.11% 0.66% 1.72%
08/31/91 7.460 0.000000 177.2385 1,322.25 1.44% 2.56% 2.11%
09/30/91 7.524 0.000000 177.2385 1,333.59 0.86% 2.31% 3.44%
10/31/91 7.644 0.000000 177.2385 1,354.77 1.59% 2.46% 3.93%
11/30/91 7.621 0.000000 177.2385 1,350.68 -0.30% 1.28% 2.15%
12/31/91 7.765 0.000000 177.2385 1,376.18 1.89% 1.58% 3.19%
01/31/92 7.778 0.000000 177.2385 1,378.49 0.17% 2.06% 1.75%
02/28/92 7.763 0.000000 177.2385 1,375.98 -0.18% -0.01% 1.87%
03/31/92 7.750 0.000000 177.2385 1,373.61 -0.17% -0.35% -0.19%
04/30/92 7.796 0.000000 177.2385 1,381.69 0.59% 0.41% 0.23%
05/31/92 7.888 0.000000 177.2385 1,398.11 1.19% 1.78% 1.61%
06/30/92 8.014 0.000000 177.2385 1,420.45 1.60% 2.80% 3.41%
07/31/92 8.212 0.000000 177.2385 1,455.50 2.47% 4.11% 5.34%
08/31/92 8.144 0.000000 177.2385 1,443.39 -0.83% 1.62% 3.24%
09/30/92 8.153 0.000000 177.2385 1,444.95 0.11% -0.72% 1.73%
10/31/92 8.139 0.000000 177.2385 1,442.61 -0.16% -0.05% -0.89%
11/30/92 8.280 0.000000 177.2385 1,467.54 1.73% 1.56% 1.67%
12/31/92 8.311 0.000000 177.2385 1,472.94 0.37% 2.10% 1.94%
01/31/93 8.380 0.000000 177.2385 1,485.28 0.84% 1.21% 2.96%
02/28/93 8.616 0.000000 177.2385 1,527.14 2.82% 3.68% 4.06%
03/31/93 8.524 0.000000 177.2385 1,510.77 -1.07% 1.72% 2.57%
04/30/93 8.577 0.000000 177.2385 1,520.26 0.63% -0.45% 2.35%
05/31/93 8.600 0.000000 177.2385 1,524.18 0.26% 0.89% -0.19%
06/30/93 8.718 0.000000 177.2385 1,545.18 1.38% 1.64% 2.28%
07/31/93 8.745 0.000000 177.2385 1,549.94 0.31% 1.69% 1.95%
<CAPTION>
===========================================================================================================
Year Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
12 Months to Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
===========================================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - - - - - - - - -
01/31/87 - - - 2.80% - - - - - - - - - - - - - - - -
02/28/87 - - - 2.93% - - - - - - - - - - - - - - - -
03/31/87 - - - 2.70% - - - - - - - - - - - - - - - -
04/30/87 - - - -3.23% - - - - - - - - - - - - - - - -
05/31/87 - - - -3.70% - - - - - - - - - - - - - - - -
06/30/87 - - - -1.62% - - - - - - - - - - - - - - - -
07/31/87 - - - -0.63% - - - - - - - - - - - - - - - -
08/31/87 - - - -0.28% - - - - - - - - - - - - - - - -
09/30/87 - - - -3.65% - - - - - - - - - - - - - - - -
10/31/87 - - - -4.78% - - - - - - - - - - - - - - - -
11/30/87 - - - -1.65% - - - - - - - - - - - - - - - -
12/31/87 13.05% 13.05% - - - - - - - - - - - - - - - -
01/31/88 0.05% -9.02% - - - - - - - - - - - - - - - -
02/29/88 0.18% -8.79% - - - - - - - - - - - - - - - -
03/31/88 -0.82% -9.90% - - - - - - - - - - - - - - - -
04/30/88 5.56% -9.64% - - - - - - - - - - - - - - - -
05/31/88 6.80% -9.03% - - - - - - - - - - - - - - - -
06/30/88 5.41% -8.27% - - - - - - - - - - - - - - - -
07/31/88 5.27% -7.47% - - - - - - - - - - - - - - - -
08/31/88 5.68% -6.78% - - - - - - - - - - - - - - - -
09/30/88 9.90% -6.33% - - - - - - - - - - - - - - - -
10/31/88 12.75% -5.03% - - - - - - - - - - - - - - - -
11/30/88 8.63% -5.50% - - - - - - - - - - - - - - - -
12/31/88 -4.68% -4.68% - - - - - - - - - - - - - - - -
01/31/89 6.11% 1.28% - - - - - - - - - - - - - - - -
02/28/89 5.33% 0.79% - - - - - - - - - - - - - - - -
03/31/89 6.17% 0.35% - - - - - - - - - - - - - - - -
04/30/89 8.28% 2.64% - - - - - - - - - - - - - - - -
05/31/89 9.66% 4.66% - - - - - - - - - - - - - - - -
06/30/89 9.91% 5.78% - - - - - - - - - - - - - - - -
07/31/89 9.74% 6.53% - - - - - - - - - - - - - - - -
08/31/89 9.15% 6.75% - - - - - - - - - - - - - - - -
09/30/89 7.56% 5.69% - - - - - - - - - - - - - - - -
10/31/89 6.90% 6.50% - - - - - - - - - - - - - - - -
11/30/89 9.64% 8.69% - - - - - - - - - - - - - - - -
12/31/89 9.78% 9.78% 5.76% - - - - - - - - - - - -
01/31/90 7.33% -0.98% 4.44% - - - - - - - - - - - -
02/28/90 8.32% -0.55% 4.55% - - - - - - - - - - - -
03/31/90 8.51% -0.81% 4.54% - - - - - - - - - - - -
04/30/90 4.96% -1.86% 6.25% - - - - - - - - - - - -
05/31/90 5.88% 0.94% 7.43% - - - - - - - - - - - -
06/30/90 5.52% 1.68% 6.92% - - - - - - - - - - - -
07/31/90 5.85% 2.71% 6.93% - - - - - - - - - - - -
08/31/90 4.60% 1.71% 6.45% - - - - - - - - - - - -
09/30/90 5.53% 1.60% 7.64% - - - - - - - - - - - -
10/31/90 6.32% 3.14% 8.61% - - - - - - - - - - - -
11/30/90 6.48% 5.43% 8.23% - - - - - - - - - - - -
12/31/90 6.02% 6.02% 3.52% - - - - - - - - - - - -
01/31/91 7.75% 0.64% 7.06% - - - - - - - - - - - -
02/28/91 8.59% 1.86% 7.40% - - - - - - - - - - - -
03/31/91 8.14% 1.18% 7.60% - - - - - - - - - - - -
04/30/91 10.38% 2.18% 7.85% - - - - - - - - - - - -
05/31/91 8.44% 3.25% 7.98% - - - - - - - - - - - -
06/30/91 7.18% 2.79% 7.52% - - - - - - - - - - - -
07/31/91 7.28% 3.93% 7.61% - - - - - - - - - - - -
08/31/91 9.89% 5.43% 7.85% - - - - - - - - - - - -
09/30/91 10.96% 6.33% 7.99% - - - - - - - - - - - -
10/31/91 11.03% 8.02% 8.06% - - - - - - - - - - - -
11/30/91 8.29% 7.69% 8.13% - - - - - - - - - - - -
12/31/91 9.73% 9.73% 8.49% 6.59% - - - - - - - -
01/31/92 9.21% 0.17% 8.10% 6.04% - - - - - - - -
02/28/92 7.70% -0.01% 8.20% 5.97% - - - - - - - -
03/31/92 8.25% -0.19% 8.29% 5.98% - - - - - - - -
04/30/92 7.82% 0.40% 7.69% 7.37% - - - - - - - -
05/31/92 7.97% 1.59% 7.42% 7.73% - - - - - - - -
06/30/92 10.18% 3.22% 7.60% 7.61% - - - - - - - -
07/31/92 11.66% 5.76% 8.23% 7.92% - - - - - - - -
08/31/92 9.16% 4.88% 7.85% 7.67% - - - - - - - -
09/30/92 8.35% 5.00% 8.25% 8.43% - - - - - - - -
10/31/92 6.48% 4.83% 7.91% 8.65% - - - - - - - -
11/30/92 8.65% 6.64% 7.80% 8.32% - - - - - - - -
12/31/92 7.03% 7.03% 7.57% 5.43% - - - - - - - -
01/31/93 7.75% 0.84% 8.23% 7.62% - - - - - - - -
02/28/93 10.99% 3.68% 9.08% 8.17% - - - - - - - -
03/31/93 9.98% 2.57% 8.78% 8.20% - - - - - - - -
04/30/93 10.03% 3.21% 9.40% 8.27% - - - - - - - -
05/31/93 9.02% 3.48% 8.47% 8.18% - - - - - - - -
06/30/93 8.78% 4.90% 8.70% 8.30% - - - - - - - -
07/31/93 6.49% 5.23% 8.44% 8.18% - - - - - - - -
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
Institutional Shares
<TABLE>
<CAPTION>
=================================================================================================================
Dividend Dividend Total Extended Change For/(From)
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months 3 Months 9 Months
=================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
08/31/93 8.865 0.000000 177.2385 1,571.30 1.38% 1.69% 3.09%
09/30/93 8.953 0.000000 177.2385 1,586.82 0.99% 2.38% 2.69%
10/31/93 8.958 0.000000 177.2385 1,587.74 0.06% 1.05% 2.44%
11/30/93 8.898 0.000000 177.2385 1,577.07 -0.67% -0.61% 0.37%
12/31/93 9.014 0.000000 177.2385 1,597.54 1.30% 0.62% 0.68%
01/31/94 9.049 0.000000 177.2385 1,603.74 0.39% 1.69% 1.01%
02/28/94 8.914 0.000000 177.2385 1,579.98 -1.48% -1.10% 0.18%
03/31/94 8.673 0.000000 177.2385 1,537.13 -2.71% -4.15% -3.78%
04/30/94 8.691 0.000000 177.2385 1,540.32 0.21% -2.51% -3.95%
05/31/94 8.717 0.000000 177.2385 1,544.91 0.30% 0.51% -2.22%
06/30/94 8.757 0.000000 177.2385 1,552.14 0.47% 0.77% 0.98%
07/31/94 8.875 0.000000 177.2385 1,572.91 1.34% 1.81% 2.12%
08/31/94 8.894 0.000000 177.2385 1,576.34 0.22% 1.56% 2.03%
09/30/94 8.733 0.000000 177.2385 1,547.78 -1.81% -1.60% -0.28%
10/31/94 8.709 0.000000 177.2385 1,543.57 -0.27% -2.08% -1.87%
11/30/94 8.563 0.000000 177.2385 1,517.76 -1.67% -1.94% -3.72%
12/31/94 8.687 0.000000 177.2385 1,539.74 1.45% -0.25% -0.52%
01/31/95 8.798 0.000000 177.2385 1,559.41 1.28% 2.74% 1.03%
02/28/95 9.011 0.000000 177.2385 1,597.12 2.42% 3.73% 5.23%
03/31/95 9.090 0.000000 177.2385 1,611.14 0.88% 3.32% 4.64%
04/30/95 9.108 0.000000 177.2385 1,614.33 0.20% 1.08% 3.52%
05/31/95 9.282 0.000000 177.2385 1,645.14 1.91% 2.11% 3.01%
06/30/95 9.270 0.000000 177.2385 1,642.96 -0.13% 1.77% 1.97%
07/31/95 9.373 0.000000 177.2385 1,661.33 1.12% 0.98% 2.91%
08/31/95 9.385 0.000000 177.2385 1,663.46 0.13% 1.25% 1.11%
09/30/95 9.457 0.000000 177.2385 1,676.07 0.76% 0.89% 2.01%
10/31/95 9.566 0.000000 177.2385 1,695.48 1.16% 1.92% 2.06%
11/30/95 9.632 0.000000 177.2385 1,707.14 0.69% 1.85% 2.63%
12/31/95 9.682 0.000000 177.2385 1,715.98 0.52% 1.21% 2.38%
01/31/96 9.711 0.000000 177.2385 1,721.10 0.30% 0.82% 1.51%
02/29/96 9.741 0.000000 177.2385 1,726.40 0.31% 0.61% 1.13%
03/31/96 9.602 0.000000 177.2385 1,701.85 -1.42% -1.12% -0.82%
04/30/96 9.617 0.000000 177.2385 1,704.54 0.16% -1.27% -0.96%
05/31/96 9.632 0.000000 177.2385 1,707.23 0.16% 0.32% -1.11%
06/30/96 9.654 0.000000 177.2385 1,711.12 0.23% 0.39% 0.54%
07/31/96 9.757 0.000000 177.2385 1,729.23 1.06% 1.29% 1.45%
08/31/96 9.846 0.000000 177.2385 1,745.10 0.92% 1.99% 2.22%
09/30/96 9.807 0.000000 177.2385 1,738.26 -0.39% 0.52% 1.59%
10/31/96 9.921 0.000000 177.2385 1,758.39 1.16% 0.76% 1.69%
11/30/96 10.046 0.000000 177.2385 1,780.51 1.26% 2.43% 2.03%
12/31/96 10.039 0.000000 177.2385 1,779.23 -0.07% 1.19% 2.36%
01/31/97 10.002 0.000000 177.2385 1,772.82 -0.36% -0.43% 0.82%
02/28/97 10.124 0.000000 177.2385 1,794.28 1.21% 0.85% 0.77%
03/31/97 10.000 0.000000 177.2385 1,772.38 -1.22% -0.03% -0.38%
04/30/97 9.990 0.036494 0.647470 177.8860 1,777.08 0.27% -0.96% 0.24%
05/31/97 10.060 0.037894 0.670055 178.5561 1,796.27 1.08% 1.35% 0.11%
06/30/97 10.110 0.036408 0.643014 179.1991 1,811.70 0.86% 1.95% 2.22%
07/31/97 10.290 0.037499 0.653041 179.8521 1,850.68 2.15% 3.03% 4.14%
08/31/97 10.150 0.037321 0.661306 180.5134 1,832.21 -1.00% 1.13% 2.00%
09/30/97 10.220 0.036288 0.640946 181.1543 1,851.40 1.05% 0.04% 2.19%
10/31/97 10.230 0.037541 0.664781 181.8191 1,860.01 0.47% 1.52% 0.50%
11/30/97 10.230 0.036511 0.648915 182.4680 1,866.65 0.36% 0.82% 1.88%
12/31/97 10.270 0.037705 0.0370 1.327290 183.7953 1,887.58 1.12% 1.48% 1.95% 6.50%
<CAPTION>
===========================================================================================================
Year Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
12 Months to Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
===========================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/93 8.86% 6.68% 9.29% 8.31% - - - - - - - -
09/30/93 9.82% 7.73% 9.69% 8.42% - - - - - - - -
10/31/93 10.06% 7.79% 9.17% 8.14% - - - - - - - -
11/30/93 7.46% 7.07% 8.13% 8.10% - - - - - - - -
12/31/93 8.46% 8.46% 8.39% 8.19% - - - - - - - -
01/31/94 7.98% 0.39% 8.30% 8.00% - - - - - - - -
02/28/94 3.46% -1.10% 7.33% 7.78% - - - - - - - -
03/31/94 1.74% -3.78% 6.59% 7.28% - - - - - - - -
04/30/94 1.32% -3.58% 6.32% 6.84% - - - - - - - -
05/31/94 1.36% -3.29% 6.05% 6.49% - - - - - - - -
06/30/94 0.45% -2.84% 6.38% 6.37% - - - - - - - -
07/31/94 1.48% -1.54% 6.46% 6.50% - - - - - - - -
08/31/94 0.32% -1.33% 6.03% 6.50% - - - - - - - -
09/30/94 -2.46% -3.12% 5.09% 6.32% - - - - - - - -
10/31/94 -2.78% -3.38% 4.44% 6.10% - - - - - - - -
11/30/94 -3.76% -4.99% 3.96% 5.32% - - - - - - - -
12/31/94 -3.62% -3.62% 3.81% 5.41% - - - - - - - -
01/31/95 -2.76% 1.28% 4.19% 5.89% - - - - - - - -
02/28/95 1.09% 3.73% 5.09% 6.30% - - - - - - - -
03/31/95 4.82% 4.64% 5.46% 6.54% - - - - - - - -
04/30/95 4.80% 4.84% 5.32% 6.81% - - - - - - - -
05/31/95 6.49% 6.85% 5.57% 6.61% - - - - - - - -
06/30/95 5.85% 6.70% 4.97% 6.43% - - - - - - - -
07/31/95 5.62% 7.90% 4.51% 6.45% - - - - - - - -
08/31/95 5.53% 8.04% 4.84% 6.69% - - - - - - - -
09/30/95 8.29% 8.85% 5.07% 6.87% - - - - - - - -
10/31/95 9.84% 10.11% 5.53% 6.80% - - - - - - - -
11/30/95 12.48% 10.87% 5.17% 6.48% - - - - - - - -
12/31/95 11.45% 11.45% 5.22% 6.47% - - - - - - - -
01/31/96 10.37% 0.30% 5.03% 6.40% - - - - - - - -
02/29/96 8.09% 0.61% 4.17% 6.20% - - - - - - - -
03/31/96 5.63% -0.82% 4.05% 6.04% - - - - - - - -
04/30/96 5.59% -0.67% 3.88% 5.86% - - - - - - - -
05/31/96 3.77% -0.51% 3.85% 5.68% - - - - - - - -
06/30/96 4.15% -0.28% 3.46% 5.82% - - - - - - - -
07/31/96 4.09% 0.77% 3.71% 5.81% - - - - - - - -
08/31/96 4.91% 1.70% 3.56% 5.70% - - - - - - - -
09/30/96 3.71% 1.30% 3.08% 5.44% - - - - - - - -
10/31/96 3.71% 2.47% 3.46% 5.35% - - - - - - - -
11/30/96 4.30% 3.76% 4.12% 5.68% - - - - - - - -
12/31/96 3.69% 3.69% 3.65% 5.27% 77.92% 5.93%
01/31/97 3.01% -0.36% 3.39% 5.15% 72.46% 5.60%
02/28/97 3.93% 0.85% 4.33% 5.45% 74.32% 5.71%
03/31/97 4.14% -0.38% 4.86% 5.23% 72.58% 5.60%
04/30/97 4.26% -0.12% 4.88% 5.16% 83.63% 6.26%
05/31/97 5.22% 0.96% 5.15% 5.14% 86.53% 6.43%
06/30/97 5.88% 1.82% 5.28% 4.98% 84.14% 6.29%
07/31/97 7.02% 4.02% 5.57% 4.92% 86.25% 6.41%
08/31/97 4.99% 2.98% 5.14% 4.88% 83.73% 6.27%
09/30/97 6.51% 4.06% 6.15% 5.08% 92.15% 6.74%
10/31/97 5.78% 4.54% 6.41% 5.21% 95.34% 6.92%
11/30/97 4.84% 4.91% 7.13% 4.93% 89.79% 6.61%
12/31/97 6.09% 6.09% 7.02% 5.08% 66.96% 5.26%
</TABLE>
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
Investor Shares
================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
================================================================================
12/31/86 5.642 0.000000 177.2385 1,000.00
01/31/87 5.800 0.000000 177.2385 1,027.98
02/28/87 5.807 0.000000 177.2385 1,029.30
03/31/87 5.795 0.000000 177.2385 1,027.01
04/30/87 5.460 0.000000 177.2385 967.73
05/31/87 5.433 0.000000 177.2385 962.97
06/30/87 5.551 0.000000 177.2385 983.85
07/31/87 5.606 0.000000 177.2385 993.67
08/31/87 5.626 0.000000 177.2385 997.22
09/30/87 5.436 0.000000 177.2385 963.50
10/31/87 5.372 0.000000 177.2385 952.21
11/30/87 5.549 0.000000 177.2385 983.51
12/31/87 6.379 0.000000 177.2385 1,130.53
01/31/88 5.803 0.000000 177.2385 1,028.53
02/29/88 5.818 0.000000 177.2385 1,031.19
03/31/88 5.747 0.000000 177.2385 1,018.59
04/30/88 5.764 0.000000 177.2385 1,021.52
05/31/88 5.803 0.000000 177.2385 1,028.45
06/30/88 5.851 0.000000 177.2385 1,037.06
07/31/88 5.902 0.000000 177.2385 1,046.07
08/31/88 5.946 0.000000 177.2385 1,053.89
09/30/88 5.975 0.000000 177.2385 1,058.93
10/31/88 6.058 0.000000 177.2385 1,073.63
11/30/88 6.028 0.000000 177.2385 1,068.34
12/31/88 6.080 0.000000 177.2385 1,077.62
01/31/89 6.158 0.000000 177.2385 1,091.39
02/28/89 6.128 0.000000 177.2385 1,086.13
03/31/89 6.102 0.000000 177.2385 1,081.44
04/30/89 6.241 0.000000 177.2385 1,106.07
05/31/89 6.363 0.000000 177.2385 1,127.84
06/30/89 6.431 0.000000 177.2385 1,139.88
07/31/89 6.477 0.000000 177.2385 1,147.95
08/31/89 6.490 0.000000 177.2385 1,150.34
09/30/89 6.426 0.000000 177.2385 1,138.93
10/31/89 6.475 0.000000 177.2385 1,147.68
11/30/89 6.609 0.000000 177.2385 1,171.30
12/31/89 6.675 0.000000 177.2385 1,182.99
01/31/90 6.609 0.000000 177.2385 1,171.37
02/28/90 6.638 0.000000 177.2385 1,176.50
03/31/90 6.621 0.000000 177.2385 1,173.42
04/30/90 6.550 0.000000 177.2385 1,160.96
05/31/90 6.737 0.000000 177.2385 1,194.14
06/30/90 6.787 0.000000 177.2385 1,202.83
07/31/90 6.856 0.000000 177.2385 1,215.07
08/31/90 6.789 0.000000 177.2385 1,203.26
09/30/90 6.781 0.000000 177.2385 1,201.92
10/31/90 6.884 0.000000 177.2385 1,220.16
11/30/90 7.037 0.000000 177.2385 1,247.22
12/31/90 7.076 0.000000 177.2385 1,254.18
01/31/91 7.121 0.000000 177.2385 1,262.19
02/28/91 7.208 0.000000 177.2385 1,277.56
03/31/91 7.160 0.000000 177.2385 1,268.97
04/30/91 7.230 0.000000 177.2385 1,281.51
05/31/91 7.306 0.000000 177.2385 1,294.94
06/30/91 7.274 0.000000 177.2385 1,289.22
07/31/91 7.355 0.000000 177.2385 1,303.50
08/31/91 7.460 0.000000 177.2385 1,322.25
09/30/91 7.524 0.000000 177.2385 1,333.59
10/31/91 7.644 0.000000 177.2385 1,354.77
11/30/91 7.621 0.000000 177.2385 1,350.68
12/31/91 7.765 0.000000 177.2385 1,376.18
01/31/92 7.778 0.000000 177.2385 1,378.49
02/28/92 7.763 0.000000 177.2385 1,375.98
03/31/92 7.750 0.000000 177.2385 1,373.61
04/30/92 7.796 0.000000 177.2385 1,381.69
05/31/92 7.888 0.000000 177.2385 1,398.11
06/30/92 8.014 0.000000 177.2385 1,420.45
07/31/92 8.212 0.000000 177.2385 1,455.50
08/31/92 8.144 0.000000 177.2385 1,443.39
09/30/92 8.153 0.000000 177.2385 1,444.95
10/31/92 8.139 0.000000 177.2385 1,442.61
11/30/92 8.280 0.000000 177.2385 1,467.54
12/31/92 8.311 0.000000 177.2385 1,472.94
01/31/93 8.380 0.000000 177.2385 1,485.28
02/28/93 8.616 0.000000 177.2385 1,527.14
03/31/93 8.524 0.000000 177.2385 1,510.77
04/30/93 8.577 0.000000 177.2385 1,520.26
05/31/93 8.600 0.000000 177.2385 1,524.18
06/30/93 8.718 0.000000 177.2385 1,545.18
07/31/93 8.745 0.000000 177.2385 1,549.94
================================================================================
Change For/(From)
Date 1 Month 2 Months 3 Months 8 Months 12 Months
================================================================================
12/31/86 - - - - - - - - - - - -
01/31/87 2.80% - - - - - - - - -
02/28/87 0.13% 2.93% - - - - - -
03/31/87 -0.22% -0.09% 2.70% - - -
04/30/87 -5.77% -5.98% -5.86% - - -
05/31/87 -0.49% -6.24% -6.44% - - -
06/30/87 2.17% 1.67% -4.20% - - -
07/31/87 1.00% 3.19% 2.68% - - -
08/31/87 0.36% 1.36% 3.56% - - -
09/30/87 -3.38% -3.04% -2.07% - - -
10/31/87 -1.17% -4.51% -4.17% - - -
11/30/87 3.29% 2.08% -1.37% - - -
12/31/87 14.95% 18.73% 17.34% 13.05%
01/31/88 -9.02% 4.58% 8.02% 0.05%
02/29/88 0.26% -8.79% 4.85% 0.18%
03/31/88 -1.22% -0.97% -9.90% -0.82%
04/30/88 0.29% -0.94% -0.68% 5.56%
05/31/88 0.68% 0.97% -0.27% 6.80%
06/30/88 0.84% 1.52% 1.81% 5.41%
07/31/88 0.87% 1.71% 2.40% 5.27%
08/31/88 0.75% 1.62% 2.47% 5.68%
09/30/88 0.48% 1.23% 2.11% 9.90%
10/31/88 1.39% 1.87% 2.63% 12.75%
11/30/88 -0.49% 0.89% 1.37% 8.63%
12/31/88 0.87% 0.37% 1.76% -4.68%
01/31/89 1.28% 2.16% 1.65% 6.11%
02/28/89 -0.48% 0.79% 1.66% 5.33%
03/31/89 -0.43% -0.91% 0.35% 6.17%
04/30/89 2.28% 1.84% 1.35% 8.28%
05/31/89 1.97% 4.29% 3.84% 9.66%
06/30/89 1.07% 3.06% 5.40% 9.91%
07/31/89 0.71% 1.78% 3.79% 9.74%
08/31/89 0.21% 0.92% 2.00% 9.15%
09/30/89 -0.99% -0.79% -0.08% 7.56%
10/31/89 0.77% -0.23% -0.02% 6.90%
11/30/89 2.06% 2.84% 1.82% 9.64%
12/31/89 1.00% 3.08% 3.87% 9.78%
01/31/90 -0.98% 0.01% 2.06% 7.33%
02/28/90 0.44% -0.55% 0.44% 8.32%
03/31/90 -0.26% 0.17% -0.81% 8.51%
04/30/90 -1.06% -1.32% -0.89% 4.96%
05/31/90 2.86% 1.77% 1.50% 5.88%
06/30/90 0.73% 3.61% 2.51% 5.52%
07/31/90 1.02% 1.75% 4.66% 5.85%
08/31/90 -0.97% 0.04% 0.76% 4.60%
09/30/90 -0.11% -1.08% -0.08% 5.53%
10/31/90 1.52% 1.40% 0.42% 6.32%
11/30/90 2.22% 3.77% 3.65% 6.48%
12/31/90 0.56% 2.79% 4.35% 6.02%
01/31/91 0.64% 1.20% 3.44% 7.75%
02/28/91 1.22% 1.86% 2.43% 8.59%
03/31/91 -0.67% 0.54% 1.18% 8.14%
04/30/91 0.99% 0.31% 1.53% 10.38%
05/31/91 1.05% 2.05% 1.36% 8.44%
06/30/91 -0.44% 0.60% 1.60% 7.18%
07/31/91 1.11% 0.66% 1.72% 7.28%
08/31/91 1.44% 2.56% 2.11% 9.89%
09/30/91 0.86% 2.31% 3.44% 10.96%
10/31/91 1.59% 2.46% 3.93% 11.03%
11/30/91 -0.30% 1.28% 2.15% 8.29%
12/31/91 1.89% 1.58% 3.19% 9.73%
01/31/92 0.17% 2.06% 1.75% 9.21%
02/28/92 -0.18% -0.01% 1.87% 7.70%
03/31/92 -0.17% -0.35% -0.19% 8.25%
04/30/92 0.59% 0.41% 0.23% 7.82%
05/31/92 1.19% 1.78% 1.61% 7.97%
06/30/92 1.60% 2.80% 3.41% 10.18%
07/31/92 2.47% 4.11% 5.34% 11.66%
08/31/92 -0.83% 1.62% 3.24% 9.16%
09/30/92 0.11% -0.72% 1.73% 8.35%
10/31/92 -0.16% -0.05% -0.89% 6.48%
11/30/92 1.73% 1.56% 1.67% 8.65%
12/31/92 0.37% 2.10% 1.94% 7.03%
01/31/93 0.84% 1.21% 2.96% 7.75%
02/28/93 2.82% 3.68% 4.06% 10.99%
03/31/93 -1.07% 1.72% 2.57% 9.98%
04/30/93 0.63% -0.45% 2.35% 10.03%
05/31/93 0.26% 0.89% -0.19% 9.02%
06/30/93 1.38% 1.64% 2.28% 8.78%
07/31/93 0.31% 1.69% 1.95% 6.49%
================================================================================
Year Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date to Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
================================================================================
12/31/86 - - - - - - - - - - - - - - - - - - -
01/31/87 2.80% - - - - - - - - - - - - - - - -
02/28/87 2.93% - - - - - - - - - - - - - - - -
03/31/87 2.70% - - - - - - - - - - - - - - - -
04/30/87 -3.23% - - - - - - - - - - - - - - - -
05/31/87 -3.70% - - - - - - - - - - - - - - - -
06/30/87 -1.62% - - - - - - - - - - - - - - - -
07/31/87 -0.63% - - - - - - - - - - - - - - - -
08/31/87 -0.28% - - - - - - - - - - - - - - - -
09/30/87 -3.65% - - - - - - - - - - - - - - - -
10/31/87 -4.78% - - - - - - - - - - - - - - - -
11/30/87 -1.65% - - - - - - - - - - - - - - - -
12/31/87 13.05% - - - - - - - - - - - - - - - -
01/31/88 -9.02% - - - - - - - - - - - - - - - -
02/29/88 -8.79% - - - - - - - - - - - - - - - -
03/31/88 -9.90% - - - - - - - - - - - - - - - -
04/30/88 -9.64% - - - - - - - - - - - - - - - -
05/31/88 -9.03% - - - - - - - - - - - - - - - -
06/30/88 -8.27% - - - - - - - - - - - - - - - -
07/31/88 -7.47% - - - - - - - - - - - - - - - -
08/31/88 -6.78% - - - - - - - - - - - - - - - -
09/30/88 -6.33% - - - - - - - - - - - - - - - -
10/31/88 -5.03% - - - - - - - - - - - - - - - -
11/30/88 -5.50% - - - - - - - - - - - - - - - -
12/31/88 -4.68% - - - - - - - - - - - - - - - -
01/31/89 1.28% - - - - - - - - - - - - - - - -
02/28/89 0.79% - - - - - - - - - - - - - - - -
03/31/89 0.35% - - - - - - - - - - - - - - - -
04/30/89 2.64% - - - - - - - - - - - - - - - -
05/31/89 4.66% - - - - - - - - - - - - - - - -
06/30/89 5.78% - - - - - - - - - - - - - - - -
07/31/89 6.53% - - - - - - - - - - - - - - - -
08/31/89 6.75% - - - - - - - - - - - - - - - -
09/30/89 5.69% - - - - - - - - - - - - - - - -
10/31/89 6.50% - - - - - - - - - - - - - - - -
11/30/89 8.69% - - - - - - - - - - - - - - - -
12/31/89 9.78% 5.76% - - - - - - - - - - - -
01/31/90 -0.98% 4.44% - - - - - - - - - - - -
02/28/90 -0.55% 4.55% - - - - - - - - - - - -
03/31/90 -0.81% 4.54% - - - - - - - - - - - -
04/30/90 -1.86% 6.25% - - - - - - - - - - - -
05/31/90 0.94% 7.43% - - - - - - - - - - - -
06/30/90 1.68% 6.92% - - - - - - - - - - - -
07/31/90 2.71% 6.93% - - - - - - - - - - - -
08/31/90 1.71% 6.45% - - - - - - - - - - - -
09/30/90 1.60% 7.64% - - - - - - - - - - - -
10/31/90 3.14% 8.61% - - - - - - - - - - - -
11/30/90 5.43% 8.23% - - - - - - - - - - - -
12/31/90 6.02% 3.52% - - - - - - - - - - - -
01/31/91 0.64% 7.06% - - - - - - - - - - - -
02/28/91 1.86% 7.40% - - - - - - - - - - - -
03/31/91 1.18% 7.60% - - - - - - - - - - - -
04/30/91 2.18% 7.85% - - - - - - - - - - - -
05/31/91 3.25% 7.98% - - - - - - - - - - - -
06/30/91 2.79% 7.52% - - - - - - - - - - - -
07/31/91 3.93% 7.61% - - - - - - - - - - - -
08/31/91 5.43% 7.85% - - - - - - - - - - - -
09/30/91 6.33% 7.99% - - - - - - - - - - - -
10/31/91 8.02% 8.06% - - - - - - - - - - - -
11/30/91 7.69% 8.13% - - - - - - - - - - - -
12/31/91 9.73% 8.49% 6.59% - - - - - - - -
01/31/92 0.17% 8.10% 6.04% - - - - - - - -
02/28/92 -0.01% 8.20% 5.97% - - - - - - - -
03/31/92 -0.19% 8.29% 5.98% - - - - - - - -
04/30/92 0.40% 7.69% 7.37% - - - - - - - -
05/31/92 1.59% 7.42% 7.73% - - - - - - - -
06/30/92 3.22% 7.60% 7.61% - - - - - - - -
07/31/92 5.76% 8.23% 7.92% - - - - - - - -
08/31/92 4.88% 7.85% 7.67% - - - - - - - -
09/30/92 5.00% 8.25% 8.43% - - - - - - - -
10/31/92 4.83% 7.91% 8.65% - - - - - - - -
11/30/92 6.64% 7.80% 8.32% - - - - - - - -
12/31/92 7.03% 7.57% 5.43% - - - - - - - -
01/31/93 0.84% 8.23% 7.62% - - - - - - - -
02/28/93 3.68% 9.08% 8.17% - - - - - - - -
03/31/93 2.57% 8.78% 8.20% - - - - - - - -
04/30/93 3.21% 9.40% 8.27% - - - - - - - -
05/31/93 3.48% 8.47% 8.18% - - - - - - - -
06/30/93 4.90% 8.70% 8.30% - - - - - - - -
07/31/93 5.23% 8.44% 8.18% - - - - - - - -
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
Investor Shares
================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
================================================================================
08/31/93 8.865 0.000000 177.2385 1,571.30
09/30/93 8.953 0.000000 177.2385 1,586.82
10/31/93 8.958 0.000000 177.2385 1,587.74
11/30/93 8.898 0.000000 177.2385 1,577.07
12/31/93 9.014 0.000000 177.2385 1,597.54
01/31/94 9.049 0.000000 177.2385 1,603.74
02/28/94 8.914 0.000000 177.2385 1,579.98
03/31/94 8.673 0.000000 177.2385 1,537.13
04/30/94 8.691 0.000000 177.2385 1,540.32
05/31/94 8.717 0.000000 177.2385 1,544.91
06/30/94 8.757 0.000000 177.2385 1,552.14
07/31/94 8.875 0.000000 177.2385 1,572.91
08/31/94 8.894 0.000000 177.2385 1,576.34
09/30/94 8.733 0.000000 177.2385 1,547.78
10/31/94 8.709 0.000000 177.2385 1,543.57
11/30/94 8.563 0.000000 177.2385 1,517.76
12/31/94 8.687 0.000000 177.2385 1,539.74
01/31/95 8.798 0.000000 177.2385 1,559.41
02/28/95 9.011 0.000000 177.2385 1,597.12
03/31/95 9.090 0.000000 177.2385 1,611.14
04/30/95 9.108 0.000000 177.2385 1,614.33
05/31/95 9.282 0.000000 177.2385 1,645.14
06/30/95 9.270 0.000000 177.2385 1,642.96
07/31/95 9.373 0.000000 177.2385 1,661.33
08/31/95 9.385 0.000000 177.2385 1,663.46
09/30/95 9.457 0.000000 177.2385 1,676.07
10/31/95 9.566 0.000000 177.2385 1,695.48
11/30/95 9.632 0.000000 177.2385 1,707.14
12/31/95 9.682 0.000000 177.2385 1,715.98
01/31/96 9.711 0.000000 177.2385 1,721.10
02/29/96 9.741 0.000000 177.2385 1,726.40
03/31/96 9.602 0.000000 177.2385 1,701.85
04/30/96 9.617 0.000000 177.2385 1,704.54
05/31/96 9.632 0.000000 177.2385 1,707.23
06/30/96 9.654 0.000000 177.2385 1,711.12
07/31/96 9.757 0.000000 177.2385 1,729.23
08/31/96 9.846 0.000000 177.2385 1,745.10
09/30/96 9.807 0.000000 177.2385 1,738.26
10/31/96 9.921 0.000000 177.2385 1,758.39
11/30/96 10.046 0.000000 177.2385 1,780.51
12/31/96 10.039 0.000000 177.2385 1,779.23
01/31/97 10.002 0.000000 177.2385 1,772.82
02/28/97 10.124 0.000000 177.2385 1,794.28
03/31/97 10.000 0.000000 177.2385 1,772.38
04/30/97 9.990 0.036494 0.647470 177.8860 1,777.08
05/31/97 10.070 0.035364 0.624703 178.5107 1,797.60
06/30/97 10.110 0.033171 0.585695 179.0964 1,810.66
07/31/97 10.290 0.035331 0.614932 179.7113 1,849.23
08/31/97 10.160 0.035164 0.621985 180.3333 1,832.19
09/30/97 10.230 0.034200 0.602874 180.9362 1,850.98
10/31/97 10.240 0.033190 0.586452 181.5227 1,858.79
11/30/97 10.230 0.032649 0.579329 182.1020 1,862.90
12/31/97 10.280 0.035174 0.0370 1.278505 183.3805 1,885.15
================================================================================
Change For/(From)
Date 1 Month 2 Months 3 Months 8 Months 12 Months
================================================================================
08/31/93 1.38% 1.69% 3.09% 8.86%
09/30/93 0.99% 2.38% 2.69% 9.82%
10/31/93 0.06% 1.05% 2.44% 10.06%
11/30/93 -0.67% -0.61% 0.37% 7.46%
12/31/93 1.30% 0.62% 0.68% 8.46%
01/31/94 0.39% 1.69% 1.01% 7.98%
02/28/94 -1.48% -1.10% 0.18% 3.46%
03/31/94 -2.71% -4.15% -3.78% 1.74%
04/30/94 0.21% -2.51% -3.95% 1.32%
05/31/94 0.30% 0.51% -2.22% 1.36%
06/30/94 0.47% 0.77% 0.98% 0.45%
07/31/94 1.34% 1.81% 2.12% 1.48%
08/31/94 0.22% 1.56% 2.03% 0.32%
09/30/94 -1.81% -1.60% -0.28% -2.46%
10/31/94 -0.27% -2.08% -1.87% -2.78%
11/30/94 -1.67% -1.94% -3.72% -3.76%
12/31/94 1.45% -0.25% -0.52% -3.62%
01/31/95 1.28% 2.74% 1.03% -2.76%
02/28/95 2.42% 3.73% 5.23% 1.09%
03/31/95 0.88% 3.32% 4.64% 4.82%
04/30/95 0.20% 1.08% 3.52% 4.80%
05/31/95 1.91% 2.11% 3.01% 6.49%
06/30/95 -0.13% 1.77% 1.97% 5.85%
07/31/95 1.12% 0.98% 2.91% 5.62%
08/31/95 0.13% 1.25% 1.11% 5.53%
09/30/95 0.76% 0.89% 2.01% 8.29%
10/31/95 1.16% 1.92% 2.06% 9.84%
11/30/95 0.69% 1.85% 2.63% 12.48%
12/31/95 0.52% 1.21% 2.38% 11.45%
01/31/96 0.30% 0.82% 1.51% 10.37%
02/29/96 0.31% 0.61% 1.13% 8.09%
03/31/96 -1.42% -1.12% -0.82% 5.63%
04/30/96 0.16% -1.27% -0.96% 5.59%
05/31/96 0.16% 0.32% -1.11% 3.77%
06/30/96 0.23% 0.39% 0.54% 4.15%
07/31/96 1.06% 1.29% 1.45% 4.09%
08/31/96 0.92% 1.99% 2.22% 4.91%
09/30/96 -0.39% 0.52% 1.59% 3.71%
10/31/96 1.16% 0.76% 1.69% 3.71%
11/30/96 1.26% 2.43% 2.03% 4.30%
12/31/96 -0.07% 1.19% 2.36% 3.69%
01/31/97 -0.36% -0.43% 0.82% 3.01%
02/28/97 1.21% 0.85% 0.77% 3.93%
03/31/97 -1.22% -0.03% -0.38% 4.14%
04/30/97 0.27% -0.96% 0.24% 4.26%
05/31/97 1.15% 1.42% 0.19% 5.29%
06/30/97 0.73% 1.89% 2.16% 5.82%
07/31/97 2.13% 2.87% 4.06% 6.94%
08/31/97 -0.92% 1.19% 1.92% 4.99%
09/30/97 1.03% 0.09% 2.23% 6.48%
10/31/97 0.42% 1.45% 0.52% 5.71%
11/30/97 0.22% 0.64% 1.68% 4.63%
12/31/97 1.19% 1.42% 1.85% 6.08% 5.95%
================================================================================
Year Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date to Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
================================================================================
08/31/93 6.68% 9.29% 8.31% - - - - - - - -
09/30/93 7.73% 9.69% 8.42% - - - - - - - -
10/31/93 7.79% 9.17% 8.14% - - - - - - - -
11/30/93 7.07% 8.13% 8.10% - - - - - - - -
12/31/93 8.46% 8.39% 8.19% - - - - - - - -
01/31/94 0.39% 8.30% 8.00% - - - - - - - -
02/28/94 -1.10% 7.33% 7.78% - - - - - - - -
03/31/94 -3.78% 6.59% 7.28% - - - - - - - -
04/30/94 -3.58% 6.32% 6.84% - - - - - - - -
05/31/94 -3.29% 6.05% 6.49% - - - - - - - -
06/30/94 -2.84% 6.38% 6.37% - - - - - - - -
07/31/94 -1.54% 6.46% 6.50% - - - - - - - -
08/31/94 -1.33% 6.03% 6.50% - - - - - - - -
09/30/94 -3.12% 5.09% 6.32% - - - - - - - -
10/31/94 -3.38% 4.44% 6.10% - - - - - - - -
11/30/94 -4.99% 3.96% 5.32% - - - - - - - -
12/31/94 -3.62% 3.81% 5.41% - - - - - - - -
01/31/95 1.28% 4.19% 5.89% - - - - - - - -
02/28/95 3.73% 5.09% 6.30% - - - - - - - -
03/31/95 4.64% 5.46% 6.54% - - - - - - - -
04/30/95 4.84% 5.32% 6.81% - - - - - - - -
05/31/95 6.85% 5.57% 6.61% - - - - - - - -
06/30/95 6.70% 4.97% 6.43% - - - - - - - -
07/31/95 7.90% 4.51% 6.45% - - - - - - - -
08/31/95 8.04% 4.84% 6.69% - - - - - - - -
09/30/95 8.85% 5.07% 6.87% - - - - - - - -
10/31/95 10.11% 5.53% 6.80% - - - - - - - -
11/30/95 10.87% 5.17% 6.48% - - - - - - - -
12/31/95 11.45% 5.22% 6.47% - - - - - - - -
01/31/96 0.30% 5.03% 6.40% - - - - - - - -
02/29/96 0.61% 4.17% 6.20% - - - - - - - -
03/31/96 -0.82% 4.05% 6.04% - - - - - - - -
04/30/96 -0.67% 3.88% 5.86% - - - - - - - -
05/31/96 -0.51% 3.85% 5.68% - - - - - - - -
06/30/96 -0.28% 3.46% 5.82% - - - - - - - -
07/31/96 0.77% 3.71% 5.81% - - - - - - - -
08/31/96 1.70% 3.56% 5.70% - - - - - - - -
09/30/96 1.30% 3.08% 5.44% - - - - - - - -
10/31/96 2.47% 3.46% 5.35% - - - - - - - -
11/30/96 3.76% 4.12% 5.68% - - - - - - - -
12/31/96 3.69% 3.65% 5.27% 77.92% 5.93%
01/31/97 -0.36% 3.39% 5.15% 72.46% 5.60%
02/28/97 0.85% 4.33% 5.45% 74.32% 5.71%
03/31/97 -0.38% 4.86% 5.23% 72.58% 5.60%
04/30/97 -0.12% 4.88% 5.16% 83.63% 6.26%
05/31/97 1.03% 5.17% 5.15% 86.67% 6.44%
06/30/97 1.77% 5.26% 4.97% 84.04% 6.28%
07/31/97 3.93% 5.54% 4.90% 86.10% 6.40%
08/31/97 2.98% 5.14% 4.88% 83.73% 6.27%
09/30/97 4.03% 6.14% 5.07% 92.11% 6.74%
10/31/97 4.47% 6.38% 5.20% 95.21% 6.91%
11/30/97 4.70% 7.06% 4.88% 89.41% 6.59%
12/31/97 5.95% 6.97% 5.06% 66.75% 5.24%
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
INSTITUTIONAL SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
<TABLE>
<CAPTION>
==================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
==================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 10.00 100.0000 1,000.00
08/31/92 9.91 0.000000 100.0000 991.00
09/30/92 10.05 0.0490 0.487562 100.4876 1,009.90
10/31/92 10.10 0.000000 100.4876 1,014.92
11/30/92 10.41 0.000000 100.4876 1,046.08
12/31/92 10.43 0.0700 0.0350 1.011620 101.4992 1,058.64
01/31/93 10.55 0.000000 101.4992 1,070.82
02/28/93 10.57 0.0250 0.240064 101.7393 1,075.38
03/31/93 10.94 0.0300 0.278993 102.0183 1,116.08
04/30/93 10.84 0.0200 0.188226 102.2065 1,107.92
05/31/93 11.01 0.0270 0.250643 102.4571 1,128.05
06/30/93 11.08 0.0300 0.277411 102.7345 1,138.30
07/31/93 11.14 0.0200 0.184443 102.9189 1,146.52
08/31/93 11.41 0.0300 0.270602 103.1895 1,177.39
09/30/93 11.42 0.0250 0.225896 103.4154 1,181.00
10/31/93 11.42 0.0200 0.181113 103.5965 1,183.07
11/30/93 11.13 0.0300 0.279236 103.8757 1,156.14
12/31/93 11.30 0.0275 0.0810 0.997391 104.8731 1,185.07
- --------------------------------------------------------------------------------------------------
01/31/94 11.67 0.0200 0.179731 105.0528 1,225.97
02/28/94 11.42 0.0200 0.183980 105.2368 1,201.80
03/31/94 10.87 0.0325 0.314645 105.5514 1,147.34
04/30/94 10.77 0.0200 0.196010 105.7474 1,138.90
05/31/94 10.90 0.0300 0.291048 106.0384 1,155.82
06/30/94 10.52 0.0350 0.352789 106.3912 1,119.24
07/31/94 10.85 0.0200 0.196113 106.5873 1,156.47
08/31/94 11.08 0.0300 0.288594 106.8759 1,184.18
09/30/94 10.84 0.0300 0.295782 107.1717 1,161.74
10/31/94 10.95 0.0150 0.146811 107.3185 1,175.14
11/30/94 10.58 0.0300 0.304306 107.6228 1,138.65
12/31/94 10.70 0.0275 0.276601 107.8994 1,154.52
- --------------------------------------------------------------------------------------------------
01/31/95 10.77 0.0200 0.200370 108.0998 1,164.23
02/28/95 11.06 0.0275 0.268783 108.3686 1,198.56
03/31/95 11.24 0.0300 0.289240 108.6578 1,221.31
04/30/95 11.47 0.0150 0.142098 108.7999 1,247.93
05/31/95 11.70 0.0375 0.348718 109.1486 1,277.04
06/30/95 11.94 0.0275 0.251389 109.4000 1,306.24
07/31/95 12.37 0.0200 0.176880 109.5769 1,355.47
08/31/95 12.29 0.0325 0.289768 109.8667 1,350.26
09/30/95 12.66 0.0150 0.130174 109.9969 1,392.56
10/31/95 12.50 0.0275 0.241993 110.2389 1,377.99
11/30/95 12.94 0.0275 0.234279 110.4732 1,429.52
12/31/95 12.99 0.0375 0.1175 1.318194 111.7914 1,452.17
- --------------------------------------------------------------------------------------------------
01/31/96 13.36 0.0150 0.125514 111.9169 1,495.21
02/29/96 13.58 0.0200 0.164826 112.0817 1,522.07
03/31/96 13.70 0.0300 0.245434 112.3271 1,538.88
04/30/96 13.79 0.0275 0.224003 112.5511 1,552.08
05/31/96 14.03 0.0200 0.160443 112.7115 1,581.34
06/30/96 14.01 0.0400 0.321803 113.0333 1,583.60
07/31/96 13.50 0.0200 0.167457 113.2008 1,528.21
08/31/96 13.85 0.0300 0.245200 113.4460 1,571.23
09/30/96 14.51 0.0200 0.156369 113.6024 1,648.37
10/31/96 14.53 0.0200 0.156369 113.7588 1,652.92
11/30/96 15.31 0.0300 0.222911 113.9817 1,745.06
12/31/96 14.12 0.0200 1.0950 9.000680 122.9824 1,736.51
- --------------------------------------------------------------------------------------------------
01/31/97 14.77 0.0150 0.124897 123.1073 1,818.29
02/28/97 14.68 0.0200 0.167721 123.2750 1,809.68
03/31/97 14.21 0.0300 0.260257 123.5353 1,755.44
04/30/97 14.65 0.0250 0.210811 123.7461 1,812.88
05/31/97 15.36 0.0350 0.281974 124.0281 1,905.07
06/30/97 16.02 0.0350 0.270973 124.2991 1,991.27
07/31/97 16.87 0.0150 0.110521 124.4096 2,098.79
08/31/97 16.15 0.0300 0.231101 124.6407 2,012.95
09/30/97 17.06 0.0200 0.146120 124.7868 2,128.86
10/31/97 16.82 0.0275 0.204021 124.9908 2,102.35
11/30/97 17.11 0.0250 0.182628 125.1734 2,141.72
12/31/97 15.54 0.0325 1.92 15.727224 140.9006 2,189.60
- --------------------------------------------------------------------------------------------------
<CAPTION>
==================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
==================================================================================================
<S> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - -
08/31/92 -0.90% - - - - - - - - - -0.90%
09/30/92 1.91% 0.99% - - - - - - 0.99%
10/31/92 0.50% 2.41% 1.49% - - - 1.49%
11/30/92 3.07% 3.58% 5.56% - - - 4.61%
12/31/92 1.20% 4.31% 4.83% - - - 5.86%
01/31/93 1.15% 2.37% 5.51% - - - 1.15%
02/28/93 0.43% 1.58% 2.80% - - - 1.58%
03/31/93 3.78% 4.23% 5.43% - - - 5.43%
04/30/93 -0.73% 3.03% 3.46% - - - 4.66%
05/31/93 1.82% 1.07% 4.90% - - - 6.56%
06/30/93 0.91% 2.74% 1.99% - - - 7.52%
07/31/93 0.72% 1.64% 3.48% 14.65% 8.30%
08/31/93 2.69% 3.43% 4.37% 18.81% 11.22%
09/30/93 0.31% 3.01% 3.75% 16.94% 11.56%
10/31/93 0.18% 0.48% 3.19% 16.57% 11.75%
11/30/93 -2.28% -2.10% -1.80% 10.52% 9.21%
12/31/93 2.50% 0.17% 0.34% 11.94% 11.94%
- --------------------------------------------------------------------------------------------------
01/31/94 3.45% 6.04% 3.63% 14.49% 3.45%
02/28/94 -1.97% 1.41% 3.95% 11.76% 1.41%
03/31/94 -4.53% -6.41% -3.18% 2.80% -3.18%
04/30/94 -0.74% -5.23% -7.10% 2.80% -3.90%
05/31/94 1.49% 0.74% -3.83% 2.46% -2.47%
06/30/94 -3.16% -1.73% -2.45% -1.67% -5.55%
07/31/94 3.33% 0.06% 1.54% 0.87% -2.41%
08/31/94 2.40% 5.80% 2.45% 0.58% -0.08%
09/30/94 -1.89% 0.46% 3.80% -1.63% -1.97%
10/31/94 1.15% -0.76% 1.61% -0.67% -0.84%
11/30/94 -3.11% -1.99% -3.84% -1.51% -3.92%
12/31/94 1.39% -1.75% -0.62% -2.58% -2.58%
- --------------------------------------------------------------------------------------------------
01/31/95 0.84% 2.25% -0.93% -5.04% 0.84%
02/28/95 2.95% 3.81% 5.26% -0.27% 3.81%
03/31/95 1.90% 4.90% 5.79% 6.45% 5.79%
04/30/95 2.18% 4.12% 7.19% 9.57% 8.09%
05/31/95 2.33% 4.56% 6.55% 10.49% 10.61%
06/30/95 2.29% 4.67% 6.95% 16.71% 13.14%
07/31/95 3.77% 6.14% 8.62% 17.21% 17.41%
08/31/95 -0.38% 3.37% 5.73% 14.02% 16.95%
09/30/95 3.13% 2.74% 6.61% 19.87% 20.62%
10/31/95 -1.05% 2.05% 1.66% 17.26% 19.36%
11/30/95 3.74% 2.65% 5.87% 25.55% 23.82%
12/31/95 1.58% 5.38% 4.28% 25.78% 25.78%
- --------------------------------------------------------------------------------------------------
01/31/96 2.96% 4.60% 8.51% 28.43% 2.96%
02/29/96 1.80% 4.81% 6.47% 26.99% 4.81%
03/31/96 1.10% 2.92% 5.97% 26.00% 5.97%
04/30/96 0.86% 1.97% 3.80% 24.37% 6.88%
05/31/96 1.89% 2.76% 3.89% 23.83% 8.89%
06/30/96 0.14% 2.03% 2.91% 21.23% 9.05%
07/31/96 -3.50% -3.36% -1.54% 12.74% 5.24%
08/31/96 2.82% -0.78% -0.64% 16.36% 8.20%
09/30/96 4.91% 7.86% 4.09% 18.37% 13.51%
10/31/96 0.28% 5.20% 8.16% 19.95% 13.82%
11/30/96 5.57% 5.87% 11.06% 22.07% 20.17%
12/31/96 -0.49% 5.06% 5.35% 19.58% 19.58%
- --------------------------------------------------------------------------------------------------
01/31/97 4.71% 4.20% 10.00% 21.61% 4.71%
02/28/97 -0.47% 4.21% 3.70% 18.90% 4.21%
03/31/97 -3.00% -3.46% 1.09% 14.07% 1.09%
04/30/97 3.27% 0.18% -0.30% 16.80% 4.40%
05/31/97 5.09% 8.52% 5.27% 20.47% 9.71%
06/30/97 4.52% 9.84% 13.43% 25.74% 14.67%
07/31/97 5.40% 10.17% 15.77% 37.34% 20.86%
08/31/97 -4.09% 1.09% 5.66% 28.11% 15.92%
09/30/97 5.76% 1.43% 6.91% 29.15% 22.59%
10/31/97 -1.25% 4.44% 0.17% 27.19% 21.07%
11/30/97 1.87% 0.60% 6.40% 22.73% 23.33%
12/31/97 2.24% 4.15% 2.85% 24.73% 26.09% 26.09%
- --------------------------------------------------------------------------------------------------
<CAPTION>
============================================================================================================
Trailing Trailing 3 Yr Trailing Trailing 5 Yr Total Since Avg.Ann.Rtn.
Date 3 Years Avg.Ann.Rtn. 5 Years Avg.Ann.Rtn. Inception Since Inc.
============================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - - - - - - - - - - -
08/31/92 - - - - - - - - - - - - - - - - -0.90% - - - -
09/30/92 - - - - - - - - - - - - - - - - 0.99% - - - -
10/31/92 - - - - - - - - - - - - - - - - 1.49% - - - -
11/30/92 - - - - - - - - - - - - - - - - 4.61% - - - -
12/31/92 - - - - - - - - - - - - - - - - 5.86% - - - -
01/31/93 - - - - - - - - - - - - - - - - 7.08% 15.34%
02/28/93 - - - - - - - - - - - - - - - - 7.54% 13.96%
03/31/93 - - - - - - - - - - - - - - - - 11.61% 18.69%
04/30/93 - - - - - - - - - - - - - - - - 10.79% 15.22%
05/31/93 - - - - - - - - - - - - - - - - 12.81% 16.08%
06/30/93 - - - - - - - - - - - - - - - - 13.83% 15.66%
07/31/93 - - - - - - - - - - - - - - - - 14.65% 15.05%
08/31/93 - - - - - - - - - - - - - - - - 17.74% 16.65%
09/30/93 - - - - - - - - - - - - - - - - 18.10% 15.68%
10/31/93 - - - - - - - - - - - - - - - - 18.31% 14.68%
11/30/93 - - - - - - - - - - - - - - - - 15.61% 11.72%
12/31/93 - - - - - - - - - - - - - - - - 18.51% 12.95%
- ------------------------------------------------------------------------------------------------------------
01/31/94 - - - - - - - - - - - - - - - - 22.60% 14.76%
02/28/94 - - - - - - - - - - - - - - - - 20.18% 12.54%
03/31/94 - - - - - - - - - - - - - - - - 14.73% 8.74%
04/30/94 - - - - - - - - - - - - - - - - 13.89% 7.84%
05/31/94 - - - - - - - - - - - - - - - - 15.58% 8.34%
06/30/94 - - - - - - - - - - - - - - - - 11.92% 6.14%
07/31/94 - - - - - - - - - - - - - - - - 15.65% 7.64%
08/31/94 - - - - - - - - - - - - - - - - 18.42% 8.55%
09/30/94 - - - - - - - - - - - - - - - - 16.17% 7.25%
10/31/94 - - - - - - - - - - - - - - - - 17.51% 7.51%
11/30/94 - - - - - - - - - - - - - - - - 13.87% 5.78%
12/31/94 - - - - - - - - - - - - - - - - 15.45% 6.18%
- ------------------------------------------------------------------------------------------------------------
01/31/95 - - - - - - - - - - - - - - - - 16.42% 6.32%
02/28/95 - - - - - - - - - - - - - - - - 19.86% 7.34%
03/31/95 - - - - - - - - - - - - - - - - 22.13% 7.86%
04/30/95 - - - - - - - - - - - - - - - - 24.79% 8.47%
05/31/95 - - - - - - - - - - - - - - - - 27.70% 9.10%
06/30/95 - - - - - - - - - - - - - - - - 30.62% 9.68%
07/31/95 - - - - - - - - - - - - - - - - 35.55% 10.76%
08/31/95 36.25% 10.86% - - - - - - - - 35.03% 10.31%
09/30/95 37.89% 11.30% - - - - - - - - 39.26% 11.11%
10/31/95 35.77% 10.73% - - - - - - - - 37.80% 10.44%
11/30/95 36.65% 10.97% - - - - - - - - 42.95% 11.40%
12/31/95 37.17% 11.11% - - - - - - - - 45.22% 11.62%
- ------------------------------------------------------------------------------------------------------------
01/31/96 39.63% 11.77% - - - - - - - - 49.52% 12.26%
02/29/96 41.54% 12.27% - - - - - - - - 52.21% 12.53%
03/31/96 37.88% 11.29% - - - - - - - - 53.89% 12.56%
04/30/96 40.09% 11.88% - - - - - - - - 55.21% 12.52%
05/31/96 40.18% 11.91% - - - - - - - - 58.13% 12.78%
06/30/96 39.12% 11.62% - - - - - - - - 58.36% 12.53%
07/31/96 33.29% 10.04% - - - - - - - - 52.82% 11.25%
08/31/96 33.45% 10.09% - - - - - - - - 57.12% 11.76%
09/30/96 39.57% 11.74% - - - - - - - - 64.84% 12.81%
10/31/96 39.71% 11.78% - - - - - - - - 65.29% 12.61%
11/30/96 50.94% 14.70% - - - - - - - - 74.51% 13.78%
12/31/96 46.53% 13.57% - - - - - - - - 73.65% 13.37%
- ------------------------------------------------------------------------------------------------------------
01/31/97 48.31% 14.03% - - - - - - - - 81.83% 14.27%
02/28/97 50.58% 14.60% - - - - - - - - 80.97% 13.90%
03/31/97 53.00% 15.21% - - - - - - - - 75.54% 12.88%
04/30/97 59.18% 16.74% - - - - - - - - 81.29% 13.41%
05/31/97 64.82% 18.11% - - - - - - - - 90.51% 14.34%
06/30/97 77.91% 21.15% - - - - - - - - 99.13% 15.12%
07/31/97 81.48% 21.95% - - - - - - - - 109.88% 16.06%
08/31/97 69.99% 19.33% 103.12% 15.22% 101.30% 14.82%
09/30/97 83.25% 22.35% 110.80% 16.07% 112.89% 15.82%
10/31/97 78.90% 21.37% 107.14% 15.67% 110.24% 15.27%
11/30/97 88.09% 23.42% 104.74% 15.40% 114.17% 15.42%
12/31/97 89.65% 23.76% 106.83% 15.63% 118.96% 15.63%
- ------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
INVESTOR SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
<TABLE>
<CAPTION>
==================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
==================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 10.00 100.0000 1000.00
08/31/92 9.91 0.000000 100.0000 991.00
09/30/92 10.05 0.0490 0.487562 100.4876 1009.90
10/31/92 10.10 0.000000 100.4876 1014.92
11/30/92 10.41 0.000000 100.4876 1046.08
12/31/92 10.43 0.0700 0.0350 1.011620 101.4992 1058.64
01/31/93 10.55 0.000000 101.4992 1070.82
02/28/93 10.57 0.0250 0.240064 101.7393 1075.38
03/31/93 10.94 0.0300 0.278993 102.0183 1116.08
04/30/93 10.84 0.0200 0.188226 102.2065 1107.92
05/31/93 11.01 0.0270 0.250643 102.4571 1128.05
06/30/93 11.08 0.0300 0.277411 102.7345 1138.30
07/31/93 11.14 0.0200 0.184443 102.9189 1146.52
08/31/93 11.41 0.0300 0.270602 103.1895 1177.39
09/30/93 11.42 0.0250 0.225896 103.4154 1181.00
10/31/93 11.42 0.0200 0.181113 103.5965 1183.07
11/30/93 11.13 0.0300 0.279236 103.8757 1156.14
12/31/93 11.30 0.0275 0.0810 0.997391 104.8731 1185.07
- --------------------------------------------------------------------------------------------------
01/31/94 11.67 0.0200 0.179731 105.0528 1225.97
02/28/94 11.42 0.0200 0.183980 105.2368 1201.80
03/31/94 10.87 0.0325 0.314645 105.5514 1147.34
04/30/94 10.77 0.0200 0.196010 105.7474 1138.90
05/31/94 10.90 0.0300 0.291048 106.0384 1155.82
06/30/94 10.52 0.0350 0.352789 106.3912 1119.24
07/31/94 10.85 0.0200 0.196113 106.5873 1156.47
08/31/94 11.08 0.0300 0.288594 106.8759 1184.18
09/30/94 10.84 0.0300 0.295782 107.1717 1161.74
10/31/94 10.95 0.0150 0.146811 107.3185 1175.14
11/30/94 10.58 0.0300 0.304306 107.6228 1138.65
12/31/94 10.70 0.0275 0.276601 107.8994 1154.52
- --------------------------------------------------------------------------------------------------
01/31/95 10.77 0.0200 0.200370 108.0998 1164.23
02/28/95 11.06 0.0275 0.268783 108.3686 1198.56
03/31/95 11.24 0.0300 0.289240 108.6578 1221.31
04/30/95 11.47 0.0150 0.142098 108.7999 1247.93
05/31/95 11.70 0.0375 0.348718 109.1486 1277.04
06/30/95 11.94 0.0275 0.251389 109.4000 1306.24
07/31/95 12.37 0.0200 0.176880 109.5769 1355.47
08/31/95 12.29 0.0325 0.289768 109.8667 1350.26
09/30/95 12.66 0.0150 0.130174 109.9969 1392.56
10/31/95 12.50 0.0275 0.241993 110.2389 1377.99
11/30/95 12.94 0.0275 0.234279 110.4732 1429.52
12/31/95 12.99 0.0375 0.1175 1.318194 111.7914 1452.17
- --------------------------------------------------------------------------------------------------
01/31/96 13.36 0.0150 0.125514 111.9169 1495.21
02/29/96 13.58 0.0200 0.164826 112.0817 1522.07
03/31/96 13.70 0.0300 0.245434 112.3271 1538.88
04/30/96 13.79 0.0275 0.224003 112.5511 1552.08
05/31/96 14.03 0.0200 0.160443 112.7115 1581.34
06/30/96 14.01 0.0400 0.321803 113.0333 1583.60
07/31/96 13.50 0.0200 0.167457 113.2008 1528.21
08/31/96 13.85 0.0300 0.245200 113.4460 1571.23
09/30/96 14.51 0.0200 0.156369 113.6024 1648.37
10/31/96 14.53 0.0200 0.156369 113.7588 1652.92
11/30/96 15.31 0.0300 0.222911 113.9817 1745.06
12/31/96 14.12 0.0200 1.0950 9.000680 122.9824 1736.51
- --------------------------------------------------------------------------------------------------
01/31/97 14.77 0.0150 0.124897 123.1073 1818.29
02/28/97 14.68 0.0200 0.167721 123.2750 1809.68
03/31/97 14.21 0.0300 0.260257 123.5353 1755.44
04/30/97 14.65 0.0250 0.210811 123.7461 1812.88
05/31/97 15.36 0.0350 0.281974 124.0281 1905.07
06/30/97 16.02 0.0325 0.251618 124.2797 1990.96
07/31/97 16.86 0.0125 0.092141 124.3718 2096.91
08/31/97 16.14 0.0250 0.192645 124.5644 2010.47
09/30/97 17.06 0.0100 0.073015 124.6374 2126.31
10/31/97 16.82 0.0250 0.185252 124.8227 2099.52
11/30/97 17.11 0.0250 0.182383 125.0051 2138.84
12/31/97 15.53 0.0325 1.9200 15.716192 140.7213 2185.40
- --------------------------------------------------------------------------------------------------
<CAPTION>
================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 12 Months to Date
================================================================================
<S> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - -
08/31/92 -0.90% - - - - - - - - - -0.90%
09/30/92 1.91% 0.99% - - - - - - 0.99%
10/31/92 0.50% 2.41% 1.49% - - - 1.49%
11/30/92 3.07% 3.58% 5.56% - - - 4.61%
12/31/92 1.20% 4.31% 4.83% - - - 5.86%
01/31/93 1.15% 2.37% 5.51% - - - 1.15%
02/28/93 0.43% 1.58% 2.80% - - - 1.58%
03/31/93 3.78% 4.23% 5.43% - - - 5.43%
04/30/93 -0.73% 3.03% 3.46% - - - 4.66%
05/31/93 1.82% 1.07% 4.90% - - - 6.56%
06/30/93 0.91% 2.74% 1.99% - - - 7.52%
07/31/93 0.72% 1.64% 3.48% 14.65% 8.30%
08/31/93 2.69% 3.43% 4.37% 18.81% 11.22%
09/30/93 0.31% 3.01% 3.75% 16.94% 11.56%
10/31/93 0.18% 0.48% 3.19% 16.57% 11.75%
11/30/93 -2.28% -2.10% -1.80% 10.52% 9.21%
12/31/93 2.50% 0.17% 0.34% 11.94% 11.94%
- --------------------------------------------------------------------------------
01/31/94 3.45% 6.04% 3.63% 14.49% 3.45%
02/28/94 -1.97% 1.41% 3.95% 11.76% 1.41%
03/31/94 -4.53% -6.41% -3.18% 2.80% -3.18%
04/30/94 -0.74% -5.23% -7.10% 2.80% -3.90%
05/31/94 1.49% 0.74% -3.83% 2.46% -2.47%
06/30/94 -3.16% -1.73% -2.45% -1.67% -5.55%
07/31/94 3.33% 0.06% 1.54% 0.87% -2.41%
08/31/94 2.40% 5.80% 2.45% 0.58% -0.08%
09/30/94 -1.89% 0.46% 3.80% -1.63% -1.97%
10/31/94 1.15% -0.76% 1.61% -0.67% -0.84%
11/30/94 -3.11% -1.99% -3.84% -1.51% -3.92%
12/31/94 1.39% -1.75% -0.62% -2.58% -2.58%
- --------------------------------------------------------------------------------
01/31/95 0.84% 2.25% -0.93% -5.04% 0.84%
02/28/95 2.95% 3.81% 5.26% -0.27% 3.81%
03/31/95 1.90% 4.90% 5.79% 6.45% 5.79%
04/30/95 2.18% 4.12% 7.19% 9.57% 8.09%
05/31/95 2.33% 4.56% 6.55% 10.49% 10.61%
06/30/95 2.29% 4.67% 6.95% 16.71% 13.14%
07/31/95 3.77% 6.14% 8.62% 17.21% 17.41%
08/31/95 -0.38% 3.37% 5.73% 14.02% 16.95%
09/30/95 3.13% 2.74% 6.61% 19.87% 20.62%
10/31/95 -1.05% 2.05% 1.66% 17.26% 19.36%
11/30/95 3.74% 2.65% 5.87% 25.55% 23.82%
12/31/95 1.58% 5.38% 4.28% 25.78% 25.78%
- --------------------------------------------------------------------------------
01/31/96 2.96% 4.60% 8.51% 28.43% 2.96%
02/29/96 1.80% 4.81% 6.47% 26.99% 4.81%
03/31/96 1.10% 2.92% 5.97% 26.00% 5.97%
04/30/96 0.86% 1.97% 3.80% 24.37% 6.88%
05/31/96 1.89% 2.76% 3.89% 23.83% 8.89%
06/30/96 0.14% 2.03% 2.91% 21.23% 9.05%
07/31/96 -3.50% -3.36% -1.54% 12.74% 5.24%
08/31/96 2.82% -0.78% -0.64% 16.36% 8.20%
09/30/96 4.91% 7.86% 4.09% 18.37% 13.51%
10/31/96 0.28% 5.20% 8.16% 19.95% 13.82%
11/30/96 5.57% 5.87% 11.06% 22.07% 20.17%
12/31/96 -0.49% 5.06% 5.35% 19.58% 19.58%
- --------------------------------------------------------------------------------
01/31/97 4.71% 4.20% 10.00% 21.61% 4.71%
02/28/97 -0.47% 4.21% 3.70% 18.90% 4.21%
03/31/97 -3.00% -3.46% 1.09% 14.07% 1.09%
04/30/97 3.27% 0.18% -0.30% 16.80% 4.40%
05/31/97 5.09% 8.52% 5.27% 20.47% 9.71%
06/30/97 4.51% 9.82% 13.42% 25.72% 14.65%
07/31/97 5.32% 10.07% 15.67% 37.21% 20.75%
08/31/97 -4.12% 0.98% 5.53% 27.96% 15.78%
09/30/97 5.76% 1.40% 6.80% 28.99% 22.45%
10/31/97 -1.26% 4.43% 0.12% 27.02% 20.90%
11/30/97 1.87% 0.59% 6.39% 22.57% 23.17%
12/31/97 2.18% 4.09% 2.78% 25.85% 25.85%
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
==========================================================================================================
Trailing Trailing 3 Yr Trailing Trailing 5 Yr Total Since Avg.Ann.Rtn.
Date 3 Years Avg.Ann.Rtn. 5 Years Avg.Ann.Rtn. Inception Since Inc.
==========================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/10/92 - - - - - - - - - - - - - - - - - - - - - - - -
08/31/92 - - - - - - - - - - - - - - - - -0.90% - - - -
09/30/92 - - - - - - - - - - - - - - - - 0.99% - - - -
10/31/92 - - - - - - - - - - - - - - - - 1.49% - - - -
11/30/92 - - - - - - - - - - - - - - - - 4.61% - - - -
12/31/92 - - - - - - - - - - - - - - - - 5.86% - - - -
01/31/93 - - - - - - - - - - - - - - - - 7.08% 15.34%
02/28/93 - - - - - - - - - - - - - - - - 7.54% 13.96%
03/31/93 - - - - - - - - - - - - - - - - 11.61% 18.69%
04/30/93 - - - - - - - - - - - - - - - - 10.79% 15.22%
05/31/93 - - - - - - - - - - - - - - - - 12.81% 16.08%
06/30/93 - - - - - - - - - - - - - - - - 13.83% 15.66%
07/31/93 - - - - - - - - - - - - - - - - 14.65% 15.05%
08/31/93 - - - - - - - - - - - - - - - - 17.74% 16.65%
09/30/93 - - - - - - - - - - - - - - - - 18.10% 15.68%
10/31/93 - - - - - - - - - - - - - - - - 18.31% 14.68%
11/30/93 - - - - - - - - - - - - - - - - 15.61% 11.72%
12/31/93 - - - - - - - - - - - - - - - - 18.51% 12.95%
- --------------------------------------------------------------------------------------------------------
01/31/94 - - - - - - - - - - - - - - - - 22.60% 14.76%
02/28/94 - - - - - - - - - - - - - - - - 20.18% 12.54%
03/31/94 - - - - - - - - - - - - - - - - 14.73% 8.74%
04/30/94 - - - - - - - - - - - - - - - - 13.89% 7.84%
05/31/94 - - - - - - - - - - - - - - - - 15.58% 8.34%
06/30/94 - - - - - - - - - - - - - - - - 11.92% 6.14%
07/31/94 - - - - - - - - - - - - - - - - 15.65% 7.64%
08/31/94 - - - - - - - - - - - - - - - - 18.42% 8.55%
09/30/94 - - - - - - - - - - - - - - - - 16.17% 7.25%
10/31/94 - - - - - - - - - - - - - - - - 17.51% 7.51%
11/30/94 - - - - - - - - - - - - - - - - 13.87% 5.78%
12/31/94 - - - - - - - - - - - - - - - - 15.45% 6.18%
- --------------------------------------------------------------------------------------------------------
01/31/95 - - - - - - - - - - - - - - - - 16.42% 6.32%
02/28/95 - - - - - - - - - - - - - - - - 19.86% 7.34%
03/31/95 - - - - - - - - - - - - - - - - 22.13% 7.86%
04/30/95 - - - - - - - - - - - - - - - - 24.79% 8.47%
05/31/95 - - - - - - - - - - - - - - - - 27.70% 9.10%
06/30/95 - - - - - - - - - - - - - - - - 30.62% 9.68%
07/31/95 - - - - - - - - - - - - - - - - 35.55% 10.76%
08/31/95 36.25% 10.86% - - - - - - - - 35.03% 10.31%
09/30/95 37.89% 11.30% - - - - - - - - 39.26% 11.11%
10/31/95 35.77% 10.73% - - - - - - - - 37.80% 10.44%
11/30/95 36.65% 10.97% - - - - - - - - 42.95% 11.40%
12/31/95 37.17% 11.11% - - - - - - - - 45.22% 11.62%
- -------------------------------------------------------------------------------------------------------
01/31/96 39.63% 11.77% - - - - - - - - 49.52% 12.26%
02/29/96 41.54% 12.27% - - - - - - - - 52.21% 12.53%
03/31/96 37.88% 11.29% - - - - - - - - 53.89% 12.56%
04/30/96 40.09% 11.88% - - - - - - - - 55.21% 12.52%
05/31/96 40.18% 11.91% - - - - - - - - 58.13% 12.78%
06/30/96 39.12% 11.62% - - - - - - - - 58.36% 12.53%
07/31/96 33.29% 10.04% - - - - - - - - 52.82% 11.25%
08/31/96 33.45% 10.09% - - - - - - - - 57.12% 11.76%
09/30/96 39.57% 11.74% - - - - - - - - 64.84% 12.81%
10/31/96 39.71% 11.78% - - - - - - - - 65.29% 12.61%
11/30/96 50.94% 14.70% - - - - - - - - 74.51% 13.78%
12/31/96 46.53% 13.57% - - - - - - - - 73.65% 13.37%
- -------------------------------------------------------------------------------------------------------
01/31/97 48.31% 14.03% - - - - - - - - 81.83% 14.27%
02/28/97 50.58% 14.60% - - - - - - - - 80.97% 13.90%
03/31/97 53.00% 15.21% - - - - - - - - 75.54% 12.88%
04/30/97 59.18% 16.74% - - - - - - - - 81.29% 13.41%
05/31/97 64.82% 18.11% - - - - - - - - 90.51% 14.34%
06/30/97 77.88% 21.14% - - - - - - - - 99.10% 15.11%
07/31/97 81.32% 21.92% - - - - - - - - 109.69% 16.04%
08/31/97 69.78% 19.28% 102.87% 15.19% 101.05% 14.79%
09/30/97 83.03% 22.30% 110.55% 16.05% 112.63% 15.79%
10/31/97 78.66% 21.32% 106.87% 15.64% 109.95% 15.24%
11/30/97 87.84% 23.36% 104.46% 15.37% 113.88% 15.39%
12/31/97 89.29% 23.68% 106.43% 15.59% 118.54% 15.59%
- -------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
Institutional Shares
<TABLE>
<CAPTION>
====================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
====================================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/86 2.789 0.000000 358.5742 1000.00
01/31/87 3.101 0.000000 358.5742 1112.08
02/28/87 3.282 0.000000 358.5742 1176.89
03/31/87 3.329 0.000000 358.5742 1193.70
04/30/87 3.292 0.000000 358.5742 1180.30
05/31/87 3.182 0.000000 358.5742 1140.86
06/30/87 3.357 0.000000 358.5742 1203.81
07/31/87 3.594 0.000000 358.5742 1288.66
08/31/87 3.712 0.000000 358.5742 1331.16
09/30/87 3.694 0.000000 358.5742 1324.74
10/31/87 2.889 0.000000 358.5742 1035.92
11/30/87 2.668 0.000000 358.5742 956.65
12/31/87 2.895 0.000000 358.5742 1038.23
01/31/88 2.953 0.000000 358.5742 1058.87
02/29/88 3.100 0.000000 358.5742 1111.69
03/31/88 3.052 0.000000 358.5742 1094.44
04/30/88 3.069 0.000000 358.5742 1100.44
05/31/88 3.040 0.000000 358.5742 1089.96
06/30/88 3.156 0.000000 358.5742 1131.68
07/31/88 3.109 0.000000 358.5742 1114.69
08/31/88 3.039 0.000000 358.5742 1089.81
09/30/88 3.154 0.000000 358.5742 1130.87
10/31/88 3.164 0.000000 358.5742 1134.69
11/30/88 3.141 0.000000 358.5742 1126.16
12/31/88 3.208 0.000000 358.5742 1150.46
01/31/89 3.436 0.000000 358.5742 1231.89
02/28/89 3.353 0.000000 358.5742 1202.30
03/31/89 3.433 0.000000 358.5742 1231.13
04/30/89 3.584 0.000000 358.5742 1285.28
05/31/89 3.726 0.000000 358.5742 1336.15
06/30/89 3.708 0.000000 358.5742 1329.57
07/31/89 4.028 0.000000 358.5742 1444.29
08/31/89 4.073 0.000000 358.5742 1460.44
09/30/89 4.070 0.000000 358.5742 1459.24
10/31/89 3.997 0.000000 358.5742 1433.38
11/30/89 4.115 0.000000 358.5742 1475.64
12/31/89 4.178 0.000000 358.5742 1498.04
01/31/90 3.930 0.000000 358.5742 1409.17
02/28/90 3.981 0.000000 358.5742 1427.61
03/31/90 4.066 0.000000 358.5742 1457.99
04/30/90 3.998 0.000000 358.5742 1433.75
05/31/90 4.349 0.000000 358.5742 1559.32
06/30/90 4.333 0.000000 358.5742 1553.83
07/31/90 4.338 0.000000 358.5742 1555.51
08/31/90 3.998 0.000000 358.5742 1433.68
09/30/90 3.794 0.000000 358.5742 1360.54
10/31/90 3.797 0.000000 358.5742 1361.46
11/30/90 3.984 0.000000 358.5742 1428.42
12/31/90 4.056 0.000000 358.5742 1454.39
01/31/91 4.196 0.000000 358.5742 1504.68
02/28/91 4.453 0.000000 358.5742 1596.89
03/31/91 4.541 0.000000 358.5742 1628.16
04/30/91 4.551 0.000000 358.5742 1631.87
05/31/91 4.708 0.000000 358.5742 1688.13
06/30/91 4.437 0.000000 358.5742 1590.86
07/31/91 4.669 0.000000 358.5742 1674.35
08/31/91 4.809 0.000000 358.5742 1724.21
09/30/91 4.718 0.000000 358.5742 1691.59
10/31/91 4.893 0.000000 358.5742 1754.49
11/30/91 4.719 0.000000 358.5742 1691.99
12/31/91 5.312 0.000000 358.5742 1904.81
01/31/92 5.130 0.000000 358.5742 1839.63
02/28/92 5.195 0.000000 358.5742 1862.95
03/31/92 5.021 0.000000 358.5742 1800.32
04/30/92 4.966 0.000000 358.5742 1780.84
05/31/92 5.088 0.000000 358.5742 1824.44
06/30/92 4.940 0.000000 358.5742 1771.49
07/31/92 5.085 0.000000 358.5742 1823.36
08/31/92 5.007 0.000000 358.5742 1795.43
09/30/92 5.109 0.000000 358.5742 1831.84
10/31/92 5.213 0.000000 358.5742 1869.35
11/30/92 5.494 0.000000 358.5742 1970.08
12/31/92 5.565 0.000000 358.5742 1995.45
01/31/93 5.618 0.000000 358.5742 2014.37
02/28/93 5.633 0.000000 358.5742 2019.76
03/31/93 5.752 0.000000 358.5742 2062.34
04/30/93 5.594 0.000000 358.5742 2005.79
05/31/93 5.854 0.000000 358.5742 2099.22
06/30/93 5.843 0.000000 358.5742 2094.98
07/31/93 5.824 0.000000 358.5742 2088.24
- -------------------------------------------------------------------------------------------------------
<CAPTION>
=======================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
=======================================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - -
01/31/87 11.21% - - - - - - - - - 11.21%
02/28/87 5.83% 17.69% - - - - - - 17.69%
03/31/87 1.43% 7.34% 19.37% - - - 19.37%
04/30/87 -1.12% 0.29% 6.13% - - - 18.03%
05/31/87 -3.34% -4.43% -3.06% - - - 14.09%
06/30/87 5.52% 1.99% 0.85% - - - 20.38%
07/31/87 7.05% 12.95% 9.18% - - - 28.87%
08/31/87 3.30% 10.58% 16.68% - - - 33.12%
09/30/87 -0.48% 2.80% 10.05% - - - 32.47%
10/31/87 -21.80% -22.18% -19.61% - - - 3.59%
11/30/87 -7.65% -27.79% -28.13% - - - -4.33%
12/31/87 8.53% 0.22% -21.63% 3.82% 3.82%
01/31/88 1.99% 10.69% 2.22% -4.78% 1.99%
02/29/88 4.99% 7.08% 16.21% -5.54% 7.08%
03/31/88 -1.55% 3.36% 5.41% -8.32% 5.41%
04/30/88 0.55% -1.01% 3.92% -6.77% 5.99%
05/31/88 -0.95% -0.41% -1.95% -4.46% 4.98%
06/30/88 3.83% 2.84% 3.40% -5.99% 9.00%
07/31/88 -1.50% 2.27% 1.29% -13.50% 7.36%
08/31/88 -2.23% -3.70% -0.01% -18.13% 4.97%
09/30/88 3.77% 1.45% -0.07% -14.63% 8.92%
10/31/88 0.34% 4.12% 1.79% 9.53% 9.29%
11/30/88 -0.75% -0.42% 3.34% 17.72% 8.47%
12/31/88 2.16% 1.39% 1.73% 10.81% 10.81%
01/31/89 7.08% 9.39% 8.57% 16.34% 7.08%
02/28/89 -2.40% 4.51% 6.76% 8.15% 4.51%
03/31/89 2.40% -0.06% 7.01% 12.49% 7.01%
04/30/89 4.40% 6.90% 4.33% 16.80% 11.72%
05/31/89 3.96% 8.53% 11.13% 22.59% 16.14%
06/30/89 -0.49% 3.45% 8.00% 17.49% 15.57%
07/31/89 8.63% 8.09% 12.37% 29.57% 25.54%
08/31/89 1.12% 9.84% 9.30% 34.01% 26.94%
09/30/89 -0.08% 1.04% 9.75% 29.04% 26.84%
10/31/89 -1.77% -1.85% -0.76% 26.32% 24.59%
11/30/89 2.95% 1.12% 1.04% 31.03% 28.26%
12/31/89 1.52% 4.51% 2.66% 30.21% 30.21%
01/31/90 -5.93% -4.50% -1.69% 14.39% -5.93%
02/28/90 1.31% -4.70% -3.25% 18.74% -4.70%
03/31/90 2.13% 3.46% -2.67% 18.43% -2.67%
04/30/90 -1.66% 0.43% 1.74% 11.55% -4.29%
05/31/90 8.76% 6.95% 9.23% 16.70% 4.09%
06/30/90 -0.35% 8.38% 6.57% 16.87% 3.72%
07/31/90 0.11% -0.24% 8.49% 7.70% 3.84%
08/31/90 -7.83% -7.73% -8.06% -1.83% -4.30%
09/30/90 -5.10% -12.53% -12.44% -6.76% -9.18%
10/31/90 0.07% -5.04% -12.47% -5.02% -9.12%
11/30/90 4.92% 4.99% -0.37% -3.20% -4.65%
12/31/90 1.82% 6.83% 6.90% -2.91% -2.91%
01/31/91 3.46% 5.34% 10.52% 6.78% 3.46%
02/28/91 6.13% 9.80% 11.79% 11.86% 9.80%
03/31/91 1.96% 8.21% 11.95% 11.67% 11.95%
04/30/91 0.23% 2.19% 8.45% 13.82% 12.20%
05/31/91 3.45% 3.68% 5.71% 8.26% 16.07%
06/30/91 -5.76% -2.51% -2.29% 2.38% 9.38%
07/31/91 5.25% -0.82% 2.60% 7.64% 15.12%
08/31/91 2.98% 8.38% 2.14% 20.26% 18.55%
09/30/91 -1.89% 1.03% 6.33% 24.33% 16.31%
10/31/91 3.72% 1.76% 4.79% 28.87% 20.63%
11/30/91 -3.56% 0.02% -1.87% 18.45% 16.34%
12/31/91 12.58% 8.57% 12.60% 30.97% 30.97%
01/31/92 -3.42% 8.73% 4.85% 22.26% -3.42%
02/28/92 1.27% -2.20% 10.10% 16.66% -2.20%
03/31/92 -3.36% -2.14% -5.49% 10.57% -5.49%
04/30/92 -1.08% -4.41% -3.20% 9.13% -6.51%
05/31/92 2.45% 1.34% -2.07% 8.07% -4.22%
06/30/92 -2.90% -0.53% -1.60% 11.35% -7.00%
07/31/92 2.93% -0.06% 2.39% 8.90% -4.28%
08/31/92 -1.53% 1.35% -1.59% 4.13% -5.74%
09/30/92 2.03% 0.46% 3.41% 8.29% -3.83%
10/31/92 2.05% 4.12% 2.52% 6.55% -1.86%
11/30/92 5.39% 7.55% 9.73% 16.44% 3.43%
12/31/92 1.29% 6.75% 8.93% 4.76% 4.76%
01/31/93 0.95% 2.25% 7.76% 9.50% 0.95%
02/28/93 0.27% 1.22% 2.52% 8.42% 1.22%
03/31/93 2.11% 2.38% 3.35% 14.55% 3.35%
04/30/93 -2.74% -0.69% -0.43% 12.63% 0.52%
05/31/93 4.66% 1.79% 3.93% 15.06% 5.20%
06/30/93 -0.20% 4.45% 1.58% 18.26% 4.99%
07/31/93 -0.32% -0.52% 4.11% 14.53% 4.65%
- -------------------------------------------------------------------------------------------------------
<CAPTION>
===================================================================================
Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
===================================================================================
<S> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - - -
01/31/87 - - - - - - - - - - - - - - - -
02/28/87 - - - - - - - - - - - - - - - -
03/31/87 - - - - - - - - - - - - - - - -
04/30/87 - - - - - - - - - - - - - - - -
05/31/87 - - - - - - - - - - - - - - - -
06/30/87 - - - - - - - - - - - - - - - -
07/31/87 - - - - - - - - - - - - - - - -
08/31/87 - - - - - - - - - - - - - - - -
09/30/87 - - - - - - - - - - - - - - - -
10/31/87 - - - - - - - - - - - - - - - -
11/30/87 - - - - - - - - - - - - - - - -
12/31/87 - - - - - - - - - - - - - - - -
01/31/88 - - - - - - - - - - - - - - - -
02/29/88 - - - - - - - - - - - - - - - -
03/31/88 - - - - - - - - - - - - - - - -
04/30/88 - - - - - - - - - - - - - - - -
05/31/88 - - - - - - - - - - - - - - - -
06/30/88 - - - - - - - - - - - - - - - -
07/31/88 - - - - - - - - - - - - - - - -
08/31/88 - - - - - - - - - - - - - - - -
09/30/88 - - - - - - - - - - - - - - - -
10/31/88 - - - - - - - - - - - - - - - -
11/30/88 - - - - - - - - - - - - - - - -
12/31/88 - - - - - - - - - - - - - - - -
01/31/89 - - - - - - - - - - - - - - - -
02/28/89 - - - - - - - - - - - - - - - -
03/31/89 - - - - - - - - - - - - - - - -
04/30/89 - - - - - - - - - - - - - - - -
05/31/89 - - - - - - - - - - - - - - - -
06/30/89 - - - - - - - - - - - - - - - -
07/31/89 - - - - - - - - - - - - - - - -
08/31/89 - - - - - - - - - - - - - - - -
09/30/89 - - - - - - - - - - - - - - - -
10/31/89 - - - - - - - - - - - - - - - -
11/30/89 - - - - - - - - - - - - - - - -
12/31/89 14.41% - - - - - - - - - - - -
01/31/90 8.20% - - - - - - - - - - - -
02/28/90 6.64% - - - - - - - - - - - -
03/31/90 6.89% - - - - - - - - - - - -
04/30/90 6.69% - - - - - - - - - - - -
05/31/90 10.97% - - - - - - - - - - - -
06/30/90 8.87% - - - - - - - - - - - -
07/31/90 6.47% - - - - - - - - - - - -
08/31/90 2.50% - - - - - - - - - - - -
09/30/90 0.89% - - - - - - - - - - - -
10/31/90 9.53% - - - - - - - - - - - -
11/30/90 14.28% - - - - - - - - - - - -
12/31/90 11.88% - - - - - - - - - - - -
01/31/91 12.41% - - - - - - - - - - - -
02/28/91 12.83% - - - - - - - - - - - -
03/31/91 14.16% - - - - - - - - - - - -
04/30/91 14.04% - - - - - - - - - - - -
05/31/91 15.70% - - - - - - - - - - - -
06/30/91 12.02% - - - - - - - - - - - -
07/31/91 14.52% - - - - - - - - - - - -
08/31/91 16.52% - - - - - - - - - - - -
09/30/91 14.37% - - - - - - - - - - - -
10/31/91 15.64% - - - - - - - - - - - -
11/30/91 14.53% - - - - - - - - - - - -
12/31/91 18.30% 13.75% - - - - - - - -
01/31/92 14.30% 10.58% - - - - - - - -
02/28/92 15.72% 9.62% - - - - - - - -
03/31/92 13.49% 8.56% - - - - - - - -
04/30/92 11.47% 8.56% - - - - - - - -
05/31/92 10.93% 9.83% - - - - - - - -
06/30/92 10.03% 8.02% - - - - - - - -
07/31/92 8.07% 7.18% - - - - - - - -
08/31/92 7.12% 6.16% - - - - - - - -
09/30/92 7.87% 6.69% - - - - - - - -
10/31/92 9.25% 12.52% - - - - - - - -
11/30/92 10.10% 15.53% - - - - - - - -
12/31/92 10.02% 13.94% - - - - - - - -
01/31/93 12.64% 13.71% - - - - - - - -
02/28/93 12.25% 12.68% - - - - - - - -
03/31/93 12.24% 13.50% - - - - - - - -
04/30/93 11.83% 12.75% - - - - - - - -
05/31/93 10.41% 14.00% - - - - - - - -
06/30/93 10.46% 13.10% - - - - - - - -
07/31/93 10.31% 13.37% - - - - - - - -
- -----------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
Institutional Shares
<TABLE>
<CAPTION>
====================================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
====================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/93 6.037 0.000000 358.5742 2164.83
09/30/93 6.012 0.000000 358.5742 2155.91
10/31/93 6.086 0.000000 358.5742 2182.17
11/30/93 6.042 0.000000 358.5742 2166.42
12/31/93 6.138 0.000000 358.5742 2201.04
01/31/94 6.362 0.000000 358.5742 2281.11
02/28/94 6.207 0.000000 358.5742 2225.63
03/31/94 5.932 0.000000 358.5742 2126.99
04/30/94 5.921 0.000000 358.5742 2123.12
05/31/94 6.041 0.000000 358.5742 2166.18
06/30/94 5.804 0.000000 358.5742 2081.22
07/31/94 6.035 0.000000 358.5742 2164.01
08/31/94 6.255 0.000000 358.5742 2242.96
09/30/94 6.081 0.000000 358.5742 2180.33
10/31/94 6.224 0.000000 358.5742 2231.74
11/30/94 5.988 0.000000 358.5742 2147.12
12/31/94 6.017 0.000000 358.5742 2157.59
01/31/95 6.097 0.000000 358.5742 2186.25
02/28/95 6.327 0.000000 358.5742 2268.63
03/31/95 6.451 0.000000 358.5742 2313.05
04/30/95 6.651 0.000000 358.5742 2384.93
05/31/95 6.865 0.000000 358.5742 2461.44
06/30/95 7.045 0.000000 358.5742 2526.13
07/31/95 7.319 0.000000 358.5742 2624.35
08/31/95 7.259 0.000000 358.5742 2603.04
09/30/95 7.506 0.000000 358.5742 2691.49
10/31/95 7.541 0.000000 358.5742 2704.08
11/30/95 7.851 0.000000 358.5742 2815.17
12/31/95 7.925 0.000000 358.5742 2841.57
01/31/96 8.310 0.000000 358.5742 2979.62
02/29/96 8.344 0.000000 358.5742 2991.77
03/31/96 8.421 0.000000 358.5742 3019.54
04/30/96 8.522 0.000000 358.5742 3055.71
05/31/96 8.736 0.000000 358.5742 3132.65
06/30/96 8.845 0.000000 358.5742 3171.75
07/31/96 8.407 0.000000 358.5742 3014.69
08/31/96 8.588 0.000000 358.5742 3079.44
09/30/96 9.200 0.000000 358.5742 3298.94
10/31/96 9.306 0.000000 358.5742 3336.81
11/30/96 9.984 0.000000 358.5742 3580.00
12/31/96 9.840 0.000000 358.5742 3528.38
01/31/97 10.483 0.000000 358.5742 3759.06
02/28/97 10.423 0.000000 358.5742 3737.56
03/31/97 10.000 0.000000 358.5742 3585.74
04/30/97 10.700 0.010000 0.335116 358.9093 3840.33
05/31/97 11.250 0.010000 0.319030 359.2283 4041.32
06/30/97 11.800 0.010000 0.304431 359.5327 4242.49
07/31/97 12.780 0.010000 0.281324 359.8140 4598.42
08/31/97 11.890 0.010000 0.302619 360.1166 4281.79
09/30/97 12.390 0.010000 0.290651 360.4073 4465.45
10/31/97 12.160 0.010000 0.296388 360.7037 4386.16
11/30/97 12.590 0.010000 0.286500 360.9902 4544.87
12/31/97 10.940 0.010000 1.87500 62.199865 423.1901 4629.70
- -------------------------------------------------------------------------------------------------------
<CAPTION>
=======================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
=======================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/93 3.67% 3.33% 3.13% 20.57% 8.49%
09/30/93 -0.41% 3.24% 2.91% 17.69% 8.04%
10/31/93 1.22% 0.80% 4.50% 16.73% 9.36%
11/30/93 -0.72% 0.49% 0.07% 9.97% 8.57%
12/31/93 1.60% 0.86% 2.09% 10.30% 10.30%
01/31/94 3.64% 5.29% 4.53% 13.24% 3.64%
02/28/94 -2.43% 1.12% 2.73% 10.19% 1.12%
03/31/94 -4.43% -6.76% -3.36% 3.13% -3.36%
04/30/94 -0.18% -4.61% -6.93% 5.85% -3.54%
05/31/94 2.03% 1.84% -2.67% 3.19% -1.58%
06/30/94 -3.92% -1.97% -2.15% -0.66% -5.44%
07/31/94 3.98% -0.10% 1.93% 3.63% -1.68%
08/31/94 3.65% 7.77% 3.54% 3.61% 1.90%
09/30/94 -2.79% 0.75% 4.76% 1.13% -0.94%
10/31/94 2.36% -0.50% 3.13% 2.27% 1.40%
11/30/94 -3.79% -1.52% -4.27% -0.89% -2.45%
12/31/94 0.49% -3.32% -1.04% -1.97% -1.97%
01/31/95 1.33% 1.82% -2.04% -4.16% 1.33%
02/28/95 3.77% 5.15% 5.66% 1.93% 5.15%
03/31/95 1.96% 5.80% 7.20% 8.75% 7.20%
04/30/95 3.11% 5.13% 9.09% 12.33% 10.54%
05/31/95 3.21% 6.42% 8.50% 13.63% 14.08%
06/30/95 2.63% 5.92% 9.21% 21.38% 17.08%
07/31/95 3.89% 6.62% 10.04% 21.27% 21.63%
08/31/95 -0.81% 3.04% 5.75% 16.05% 20.65%
09/30/95 3.40% 2.56% 6.55% 23.44% 24.74%
10/31/95 0.47% 3.88% 3.04% 21.16% 25.33%
11/30/95 4.11% 4.60% 8.15% 31.11% 30.48%
12/31/95 0.94% 5.08% 5.58% 31.70% 31.70%
01/31/96 4.86% 5.84% 10.19% 36.29% 4.86%
02/29/96 0.41% 5.29% 6.27% 31.88% 5.29%
03/31/96 0.93% 1.34% 6.26% 30.54% 6.26%
04/30/96 1.20% 2.14% 2.55% 28.13% 7.54%
05/31/96 2.52% 3.75% 4.71% 27.27% 10.24%
06/30/96 1.25% 3.80% 5.04% 25.56% 11.62%
07/31/96 -4.95% -3.77% -1.34% 14.87% 6.09%
08/31/96 2.15% -2.91% -1.70% 18.30% 8.37%
09/30/96 7.13% 9.43% 4.01% 22.57% 16.10%
10/31/96 1.15% 8.36% 10.69% 23.40% 17.43%
11/30/96 7.29% 8.52% 16.25% 27.17% 25.99%
12/31/96 -1.44% 5.74% 6.95% 24.17% 24.17%
01/31/97 6.54% 5.00% 12.65% 26.16% 6.54%
02/28/97 -0.57% 5.93% 4.40% 24.93% 5.93%
03/31/97 -4.06% -4.61% 1.63% 18.75% 1.63%
04/30/97 7.10% 2.75% 2.16% 25.68% 8.84%
05/31/97 5.23% 12.71% 8.13% 29.01% 14.54%
06/30/97 4.98% 10.47% 18.32% 33.76% 20.24%
07/31/97 8.39% 13.79% 19.74% 52.53% 30.33%
08/31/97 -6.89% 0.93% 5.95% 39.04% 21.35%
09/30/97 4.29% -2.89% 5.26% 35.36% 26.56%
10/31/97 -1.78% 2.44% -4.62% 31.45% 24.31%
11/30/97 3.62% 1.78% 6.14% 26.95% 28.81%
12/31/97 1.87% 5.55% 3.68% 29.11% 31.21% 31.21%
- -------------------------------------------------------------------------------------------------------
<CAPTION>
===================================================================================
Trailing 3 Yr Trailing 5 Yr Trailing 10 Yr Trailing 10 Yr
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
===================================================================================
<S> <C> <C> <C> <C>
08/31/93 14.71% 14.71% - - - - - - - -
09/30/93 16.57% 13.77% - - - - - - - -
10/31/93 17.01% 13.96% - - - - - - - -
11/30/93 14.88% 13.97% - - - - - - - -
12/31/93 14.80% 13.85% - - - - - - - -
01/31/94 14.86% 13.11% - - - - - - - -
02/28/94 11.69% 13.10% - - - - - - - -
03/31/94 9.31% 11.55% - - - - - - - -
04/30/94 9.16% 10.55% - - - - - - - -
05/31/94 8.66% 10.14% - - - - - - - -
06/30/94 9.36% 9.37% - - - - - - - -
07/31/94 8.92% 8.42% - - - - - - - -
08/31/94 9.15% 8.95% - - - - - - - -
09/30/94 8.82% 8.36% - - - - - - - -
10/31/94 8.34% 9.25% - - - - - - - -
11/30/94 8.26% 7.78% - - - - - - - -
12/31/94 4.24% 7.57% - - - - - - - -
01/31/95 5.92% 9.18% - - - - - - - -
02/28/95 6.78% 9.70% - - - - - - - -
03/31/95 8.71% 9.66% - - - - - - - -
04/30/95 10.23% 10.71% - - - - - - - -
05/31/95 10.50% 9.55% - - - - - - - -
06/30/95 12.56% 10.20% - - - - - - - -
07/31/95 12.91% 11.02% - - - - - - - -
08/31/95 13.18% 12.66% - - - - - - - -
09/30/95 13.68% 14.61% - - - - - - - -
10/31/95 13.09% 14.70% - - - - - - - -
11/30/95 12.64% 14.52% - - - - - - - -
12/31/95 12.51% 14.33% - - - - - - - -
01/31/96 13.94% 14.63% - - - - - - - -
02/29/96 13.98% 13.36% - - - - - - - -
03/31/96 13.54% 13.13% - - - - - - - -
04/30/96 15.05% 13.35% - - - - - - - -
05/31/96 14.26% 13.15% - - - - - - - -
06/30/96 14.81% 14.78% - - - - - - - -
07/31/96 13.01% 12.47% - - - - - - - -
08/31/96 12.45% 12.28% - - - - - - - -
09/30/96 15.22% 14.28% - - - - - - - -
10/31/96 15.19% 13.70% - - - - - - - -
11/30/96 18.21% 16.15% - - - - - - - -
12/31/96 17.02% 13.11% 252.84% 13.43%
01/31/97 18.10% 15.35% 238.02% 12.94%
02/28/97 18.84% 14.92% 217.58% 12.24%
03/31/97 19.00% 14.77% 200.39% 11.62%
04/30/97 21.82% 16.60% 225.37% 12.51%
05/31/97 23.08% 17.23% 254.23% 13.47%
06/30/97 26.77% 19.07% 252.42% 13.41%
07/31/97 28.53% 20.31% 256.84% 13.55%
08/31/97 24.03% 18.97% 221.66% 12.38%
09/30/97 26.97% 19.50% 237.08% 12.91%
10/31/97 25.23% 18.59% 323.41% 15.51%
11/30/97 28.37% 18.19% 375.08% 16.85%
12/31/97 28.95% 18.32% 345.92% 16.11%
- --------------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
Investor Shares
<TABLE>
<CAPTION>
=============================================================================================================================
Dividend Dividend Total Extended Change For/(From)
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months 3 Months 8 Months 12 Months
=============================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
12/31/86 2.789 0.000000 358.5742 1,000.00 - - - - - - - - - - - -
01/31/87 3.101 0.000000 358.5742 1,112.08 11.21% - - - - - - - - -
02/28/87 3.282 0.000000 358.5742 1,176.89 5.83% 17.69% - - - - - -
03/31/87 3.329 0.000000 358.5742 1,193.70 1.43% 7.34% 19.37% - - -
04/30/87 3.292 0.000000 358.5742 1,180.30 -1.12% 0.29% 6.13% - - -
05/31/87 3.182 0.000000 358.5742 1,140.86 -3.34% -4.43% -3.06% - - -
06/30/87 3.357 0.000000 358.5742 1,203.81 5.52% 1.99% 0.85% - - -
07/31/87 3.594 0.000000 358.5742 1,288.66 7.05% 12.95% 9.18% - - -
08/31/87 3.712 0.000000 358.5742 1,331.16 3.30% 10.58% 16.68% - - -
09/30/87 3.694 0.000000 358.5742 1,324.74 -0.48% 2.80% 10.05% - - -
10/31/87 2.889 0.000000 358.5742 1,035.92 -21.80% -22.18% -19.61% - - -
11/30/87 2.668 0.000000 358.5742 956.65 -7.65% -27.79% -28.13% - - -
12/31/87 2.895 0.000000 358.5742 1,038.23 8.53% 0.22% -21.63% 3.82%
01/31/88 2.953 0.000000 358.5742 1,058.87 1.99% 10.69% 2.22% -4.78%
02/29/88 3.100 0.000000 358.5742 1,111.69 4.99% 7.08% 16.21% -5.54%
03/31/88 3.052 0.000000 358.5742 1,094.44 -1.55% 3.36% 5.41% -8.32%
04/30/88 3.069 0.000000 358.5742 1,100.44 0.55% -1.01% 3.92% -6.77%
05/31/88 3.040 0.000000 358.5742 1,089.96 -0.95% -0.41% -1.95% -4.46%
06/30/88 3.156 0.000000 358.5742 1,131.68 3.83% 2.84% 3.40% -5.99%
07/31/88 3.109 0.000000 358.5742 1,114.69 -1.50% 2.27% 1.29% -13.50%
08/31/88 3.039 0.000000 358.5742 1,089.81 -2.23% -3.70% -0.01% -18.13%
09/30/88 3.154 0.000000 358.5742 1,130.87 3.77% 1.45% -0.07% -14.63%
10/31/88 3.164 0.000000 358.5742 1,134.69 0.34% 4.12% 1.79% 9.53%
11/30/88 3.141 0.000000 358.5742 1,126.16 -0.75% -0.42% 3.34% 17.72%
12/31/88 3.208 0.000000 358.5742 1,150.46 2.16% 1.39% 1.73% 10.81%
01/31/89 3.436 0.000000 358.5742 1,231.89 7.08% 9.39% 8.57% 16.34%
02/28/89 3.353 0.000000 358.5742 1,202.30 -2.40% 4.51% 6.76% 8.15%
03/31/89 3.433 0.000000 358.5742 1,231.13 2.40% -0.06% 7.01% 12.49%
04/30/89 3.584 0.000000 358.5742 1,285.28 4.40% 6.90% 4.33% 16.80%
05/31/89 3.726 0.000000 358.5742 1,336.15 3.96% 8.53% 11.13% 22.59%
06/30/89 3.708 0.000000 358.5742 1,329.57 -0.49% 3.45% 8.00% 17.49%
07/31/89 4.028 0.000000 358.5742 1,444.29 8.63% 8.09% 12.37% 29.57%
08/31/89 4.073 0.000000 358.5742 1,460.44 1.12% 9.84% 9.30% 34.01%
09/30/89 4.070 0.000000 358.5742 1,459.24 -0.08% 1.04% 9.75% 29.04%
10/31/89 3.997 0.000000 358.5742 1,433.38 -1.77% -1.85% -0.76% 26.32%
11/30/89 4.115 0.000000 358.5742 1,475.64 2.95% 1.12% 1.04% 31.03%
12/31/89 4.178 0.000000 358.5742 1,498.04 1.52% 4.51% 2.66% 30.21%
01/31/90 3.930 0.000000 358.5742 1,409.17 -5.93% -4.50% -1.69% 14.39%
02/28/90 3.981 0.000000 358.5742 1,427.61 1.31% -4.70% -3.25% 18.74%
03/31/90 4.066 0.000000 358.5742 1,457.99 2.13% 3.46% -2.67% 18.43%
04/30/90 3.998 0.000000 358.5742 1,433.75 -1.66% 0.43% 1.74% 11.55%
05/31/90 4.349 0.000000 358.5742 1,559.32 8.76% 6.95% 9.23% 16.70%
06/30/90 4.333 0.000000 358.5742 1,553.83 -0.35% 8.38% 6.57% 16.87%
07/31/90 4.338 0.000000 358.5742 1,555.51 0.11% -0.24% 8.49% 7.70%
08/31/90 3.998 0.000000 358.5742 1,433.68 -7.83% -7.73% -8.06% -1.83%
09/30/90 3.794 0.000000 358.5742 1,360.54 -5.10% -12.53% -12.44% -6.76%
10/31/90 3.797 0.000000 358.5742 1,361.46 0.07% -5.04% -12.47% -5.02%
11/30/90 3.984 0.000000 358.5742 1,428.42 4.92% 4.99% -0.37% -3.20%
12/31/90 4.056 0.000000 358.5742 1,454.39 1.82% 6.83% 6.90% -2.91%
01/31/91 4.196 0.000000 358.5742 1,504.68 3.46% 5.34% 10.52% 6.78%
02/28/91 4.453 0.000000 358.5742 1,596.89 6.13% 9.80% 11.79% 11.86%
03/31/91 4.541 0.000000 358.5742 1,628.16 1.96% 8.21% 11.95% 11.67%
04/30/91 4.551 0.000000 358.5742 1,631.87 0.23% 2.19% 8.45% 13.82%
05/31/91 4.708 0.000000 358.5742 1,688.13 3.45% 3.68% 5.71% 8.26%
06/30/91 4.437 0.000000 358.5742 1,590.86 -5.76% -2.51% -2.29% 2.38%
07/31/91 4.669 0.000000 358.5742 1,674.35 5.25% -0.82% 2.60% 7.64%
08/31/91 4.809 0.000000 358.5742 1,724.21 2.98% 8.38% 2.14% 20.26%
09/30/91 4.718 0.000000 358.5742 1,691.59 -1.89% 1.03% 6.33% 24.33%
10/31/91 4.893 0.000000 358.5742 1,754.49 3.72% 1.76% 4.79% 28.87%
11/30/91 4.719 0.000000 358.5742 1,691.99 -3.56% 0.02% -1.87% 18.45%
12/31/91 5.312 0.000000 358.5742 1,904.81 12.58% 8.57% 12.60% 30.97%
01/31/92 5.130 0.000000 358.5742 1,839.63 -3.42% 8.73% 4.85% 22.26%
02/28/92 5.195 0.000000 358.5742 1,862.95 1.27% -2.20% 10.10% 16.66%
03/31/92 5.021 0.000000 358.5742 1,800.32 -3.36% -2.14% -5.49% 10.57%
04/30/92 4.966 0.000000 358.5742 1,780.84 -1.08% -4.41% -3.20% 9.13%
05/31/92 5.088 0.000000 358.5742 1,824.44 2.45% 1.34% -2.07% 8.07%
06/30/92 4.940 0.000000 358.5742 1,771.49 -2.90% -0.53% -1.60% 11.35%
07/31/92 5.085 0.000000 358.5742 1,823.36 2.93% -0.06% 2.39% 8.90%
08/31/92 5.007 0.000000 358.5742 1,795.43 -1.53% 1.35% -1.59% 4.13%
09/30/92 5.109 0.000000 358.5742 1,831.84 2.03% 0.46% 3.41% 8.29%
10/31/92 5.213 0.000000 358.5742 1,869.35 2.05% 4.12% 2.52% 6.55%
11/30/92 5.494 0.000000 358.5742 1,970.08 5.39% 7.55% 9.73% 16.44%
12/31/92 5.565 0.000000 358.5742 1,995.45 1.29% 6.75% 8.93% 4.76%
01/31/93 5.618 0.000000 358.5742 2,014.37 0.95% 2.25% 7.76% 9.50%
02/28/93 5.633 0.000000 358.5742 2,019.76 0.27% 1.22% 2.52% 8.42%
03/31/93 5.752 0.000000 358.5742 2,062.34 2.11% 2.38% 3.35% 14.55%
04/30/93 5.594 0.000000 358.5742 2,005.79 -2.74% -0.69% -0.43% 12.63%
05/31/93 5.854 0.000000 358.5742 2,099.22 4.66% 1.79% 3.93% 15.06%
06/30/93 5.843 0.000000 358.5742 2,094.98 -0.20% 4.45% 1.58% 18.26%
07/31/93 5.824 0.000000 358.5742 2,088.24 -0.32% -0.52% 4.11% 14.53%
<CAPTION>
==========================================================================================
Year Trailing 3 Yr Trailing 5 Trailing 10 Trailing 10 Yr
Date to Date Avg.Ann.Rtn. Avg.Ann.Rtn Total Return Avg.Ann.Rtn.
==========================================================================================
<S> <C> <C> <C> <C> <C>
12/31/86 - - - - - - - - - - - - - - - - - - -
01/31/87 11.21% - - - - - - - - - - - - - - - -
02/28/87 17.69% - - - - - - - - - - - - - - - -
03/31/87 19.37% - - - - - - - - - - - - - - - -
04/30/87 18.03% - - - - - - - - - - - - - - - -
05/31/87 14.09% - - - - - - - - - - - - - - - -
06/30/87 20.38% - - - - - - - - - - - - - - - -
07/31/87 28.87% - - - - - - - - - - - - - - - -
08/31/87 33.12% - - - - - - - - - - - - - - - -
09/30/87 32.47% - - - - - - - - - - - - - - - -
10/31/87 3.59% - - - - - - - - - - - - - - - -
11/30/87 -4.33% - - - - - - - - - - - - - - - -
12/31/87 3.82% - - - - - - - - - - - - - - - -
01/31/88 1.99% - - - - - - - - - - - - - - - -
02/29/88 7.08% - - - - - - - - - - - - - - - -
03/31/88 5.41% - - - - - - - - - - - - - - - -
04/30/88 5.99% - - - - - - - - - - - - - - - -
05/31/88 4.98% - - - - - - - - - - - - - - - -
06/30/88 9.00% - - - - - - - - - - - - - - - -
07/31/88 7.36% - - - - - - - - - - - - - - - -
08/31/88 4.97% - - - - - - - - - - - - - - - -
09/30/88 8.92% - - - - - - - - - - - - - - - -
10/31/88 9.29% - - - - - - - - - - - - - - - -
11/30/88 8.47% - - - - - - - - - - - - - - - -
12/31/88 10.81% - - - - - - - - - - - - - - - -
01/31/89 7.08% - - - - - - - - - - - - - - - -
02/28/89 4.51% - - - - - - - - - - - - - - - -
03/31/89 7.01% - - - - - - - - - - - - - - - -
04/30/89 11.72% - - - - - - - - - - - - - - - -
05/31/89 16.14% - - - - - - - - - - - - - - - -
06/30/89 15.57% - - - - - - - - - - - - - - - -
07/31/89 25.54% - - - - - - - - - - - - - - - -
08/31/89 26.94% - - - - - - - - - - - - - - - -
09/30/89 26.84% - - - - - - - - - - - - - - - -
10/31/89 24.59% - - - - - - - - - - - - - - - -
11/30/89 28.26% - - - - - - - - - - - - - - - -
12/31/89 30.21% 14.41% - - - - - - - - - - - -
01/31/90 -5.93% 8.20% - - - - - - - - - - - -
02/28/90 -4.70% 6.64% - - - - - - - - - - - -
03/31/90 -2.67% 6.89% - - - - - - - - - - - -
04/30/90 -4.29% 6.69% - - - - - - - - - - - -
05/31/90 4.09% 10.97% - - - - - - - - - - - -
06/30/90 3.72% 8.87% - - - - - - - - - - - -
07/31/90 3.84% 6.47% - - - - - - - - - - - -
08/31/90 -4.30% 2.50% - - - - - - - - - - - -
09/30/90 -9.18% 0.89% - - - - - - - - - - - -
10/31/90 -9.12% 9.53% - - - - - - - - - - - -
11/30/90 -4.65% 14.28% - - - - - - - - - - - -
12/31/90 -2.91% 11.88% - - - - - - - - - - - -
01/31/91 3.46% 12.41% - - - - - - - - - - - -
02/28/91 9.80% 12.83% - - - - - - - - - - - -
03/31/91 11.95% 14.16% - - - - - - - - - - - -
04/30/91 12.20% 14.04% - - - - - - - - - - - -
05/31/91 16.07% 15.70% - - - - - - - - - - - -
06/30/91 9.38% 12.02% - - - - - - - - - - - -
07/31/91 15.12% 14.52% - - - - - - - - - - - -
08/31/91 18.55% 16.52% - - - - - - - - - - - -
09/30/91 16.31% 14.37% - - - - - - - - - - - -
10/31/91 20.63% 15.64% - - - - - - - - - - - -
11/30/91 16.34% 14.53% - - - - - - - - - - - -
12/31/91 30.97% 18.30% 13.75% - - - - - - - -
01/31/92 -3.42% 14.30% 10.58% - - - - - - - -
02/28/92 -2.20% 15.72% 9.62% - - - - - - - -
03/31/92 -5.49% 13.49% 8.56% - - - - - - - -
04/30/92 -6.51% 11.47% 8.56% - - - - - - - -
05/31/92 -4.22% 10.93% 9.83% - - - - - - - -
06/30/92 -7.00% 10.03% 8.02% - - - - - - - -
07/31/92 -4.28% 8.07% 7.18% - - - - - - - -
08/31/92 -5.74% 7.12% 6.16% - - - - - - - -
09/30/92 -3.83% 7.87% 6.69% - - - - - - - -
10/31/92 -1.86% 9.25% 12.52% - - - - - - - -
11/30/92 3.43% 10.10% 15.53% - - - - - - - -
12/31/92 4.76% 10.02% 13.94% - - - - - - - -
01/31/93 0.95% 12.64% 13.71% - - - - - - - -
02/28/93 1.22% 12.25% 12.68% - - - - - - - -
03/31/93 3.35% 12.24% 13.50% - - - - - - - -
04/30/93 0.52% 11.83% 12.75% - - - - - - - -
05/31/93 5.20% 10.41% 14.00% - - - - - - - -
06/30/93 4.99% 10.46% 13.10% - - - - - - - -
07/31/93 4.65% 10.31% 13.37% - - - - - - - -
</TABLE>
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
Investor Shares
<TABLE>
<CAPTION>
=============================================================================================================================
Dividend Dividend Total Extended Change For/(From)
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months 3 Months 8 Months 12 Months
=============================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
08/31/93 6.037 0.000000 358.5742 2,164.83 3.67% 3.33% 3.13% 20.57%
09/30/93 6.012 0.000000 358.5742 2,155.91 -0.41% 3.24% 2.91% 17.69%
10/31/93 6.086 0.000000 358.5742 2,182.17 1.22% 0.80% 4.50% 16.73%
11/30/93 6.042 0.000000 358.5742 2,166.42 -0.72% 0.49% 0.07% 9.97%
12/31/93 6.138 0.000000 358.5742 2,201.04 1.60% 0.86% 2.09% 10.30%
01/31/94 6.362 0.000000 358.5742 2,281.11 3.64% 5.29% 4.53% 13.24%
02/28/94 6.207 0.000000 358.5742 2,225.63 -2.43% 1.12% 2.73% 10.19%
03/31/94 5.932 0.000000 358.5742 2,126.99 -4.43% -6.76% -3.36% 3.13%
04/30/94 5.921 0.000000 358.5742 2,123.12 -0.18% -4.61% -6.93% 5.85%
05/31/94 6.041 0.000000 358.5742 2,166.18 2.03% 1.84% -2.67% 3.19%
06/30/94 5.804 0.000000 358.5742 2,081.22 -3.92% -1.97% -2.15% -0.66%
07/31/94 6.035 0.000000 358.5742 2,164.01 3.98% -0.10% 1.93% 3.63%
08/31/94 6.255 0.000000 358.5742 2,242.96 3.65% 7.77% 3.54% 3.61%
09/30/94 6.081 0.000000 358.5742 2,180.33 -2.79% 0.75% 4.76% 1.13%
10/31/94 6.224 0.000000 358.5742 2,231.74 2.36% -0.50% 3.13% 2.27%
11/30/94 5.988 0.000000 358.5742 2,147.12 -3.79% -1.52% -4.27% -0.89%
12/31/94 6.017 0.000000 358.5742 2,157.59 0.49% -3.32% -1.04% -1.97%
01/31/95 6.097 0.000000 358.5742 2,186.25 1.33% 1.82% -2.04% -4.16%
02/28/95 6.327 0.000000 358.5742 2,268.63 3.77% 5.15% 5.66% 1.93%
03/31/95 6.451 0.000000 358.5742 2,313.05 1.96% 5.80% 7.20% 8.75%
04/30/95 6.651 0.000000 358.5742 2,384.93 3.11% 5.13% 9.09% 12.33%
05/31/95 6.865 0.000000 358.5742 2,461.44 3.21% 6.42% 8.50% 13.63%
06/30/95 7.045 0.000000 358.5742 2,526.13 2.63% 5.92% 9.21% 21.38%
07/31/95 7.319 0.000000 358.5742 2,624.35 3.89% 6.62% 10.04% 21.27%
08/31/95 7.259 0.000000 358.5742 2,603.04 -0.81% 3.04% 5.75% 16.05%
09/30/95 7.506 0.000000 358.5742 2,691.49 3.40% 2.56% 6.55% 23.44%
10/31/95 7.541 0.000000 358.5742 2,704.08 0.47% 3.88% 3.04% 21.16%
11/30/95 7.851 0.000000 358.5742 2,815.17 4.11% 4.60% 8.15% 31.11%
12/31/95 7.925 0.000000 358.5742 2,841.57 0.94% 5.08% 5.58% 31.70%
01/31/96 8.310 0.000000 358.5742 2,979.62 4.86% 5.84% 10.19% 36.29%
02/29/96 8.344 0.000000 358.5742 2,991.77 0.41% 5.29% 6.27% 31.88%
03/31/96 8.421 0.000000 358.5742 3,019.54 0.93% 1.34% 6.26% 30.54%
04/30/96 8.522 0.000000 358.5742 3,055.71 1.20% 2.14% 2.55% 28.13%
05/31/96 8.736 0.000000 358.5742 3,132.65 2.52% 3.75% 4.71% 27.27%
06/30/96 8.845 0.000000 358.5742 3,171.75 1.25% 3.80% 5.04% 25.56%
07/31/96 8.407 0.000000 358.5742 3,014.69 -4.95% -3.77% -1.34% 14.87%
08/31/96 8.588 0.000000 358.5742 3,079.44 2.15% -2.91% -1.70% 18.30%
09/30/96 9.200 0.000000 358.5742 3,298.94 7.13% 9.43% 4.01% 22.57%
10/31/96 9.306 0.000000 358.5742 3,336.81 1.15% 8.36% 10.69% 23.40%
11/30/96 9.984 0.000000 358.5742 3,580.00 7.29% 8.52% 16.25% 27.17%
12/31/96 9.840 0.000000 358.5742 3,528.38 -1.44% 5.74% 6.95% 24.17%
01/31/97 10.483 0.000000 358.5742 3,759.06 6.54% 5.00% 12.65% 26.16%
02/28/97 10.423 0.000000 358.5742 3,737.56 -0.57% 5.93% 4.40% 24.93%
03/31/97 10.000 0.000000 358.5742 3,585.74 -4.06% -4.61% 1.63% 18.75%
04/30/97 10.700 0.010000 0.335116 358.9093 3,840.33 7.10% 2.75% 2.16% 25.68%
05/31/97 11.250 0.010000 0.319030 359.2283 4,041.32 5.23% 12.71% 8.13% 29.01%
06/30/97 11.800 0.010000 0.304431 359.5327 4,242.49 4.98% 10.47% 18.32% 33.76%
07/31/97 12.780 0.010000 0.281324 359.8140 4,598.42 8.39% 13.79% 19.74% 52.53%
08/31/97 11.890 0.010000 0.302619 360.1166 4,281.79 -6.89% 0.93% 5.95% 39.04%
09/30/97 12.390 0.010000 0.290651 360.4073 4,465.45 4.29% -2.89% 5.26% 35.36%
10/31/97 12.150 0.010000 0.296632 360.7039 4,382.55 -1.86% 2.35% -4.69% 31.34%
11/30/97 12.580 0.010000 0.286728 360.9906 4,541.26 3.62% 1.70% 6.06% 26.85%
12/31/97 10.920 0.010000 1.87500 62.313854 423.3045 4,622.49 1.79% 5.47% 3.52% 20.37% 31.01%
- -----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
==========================================================================================
Year Trailing 3 Yr Trailing 5 Trailing 10 Trailing 10 Yr
Date to Date Avg.Ann.Rtn. Avg.Ann.Rtn Total Return Avg.Ann.Rtn.
==========================================================================================
<S> <C> <C> <C> <C> <C>
08/31/93 8.49% 14.71% 14.71% - - - - - - - -
09/30/93 8.04% 16.57% 13.77% - - - - - - - -
10/31/93 9.36% 17.01% 13.96% - - - - - - - -
11/30/93 8.57% 14.88% 13.97% - - - - - - - -
12/31/93 10.30% 14.80% 13.85% - - - - - - - -
01/31/94 3.64% 14.86% 13.11% - - - - - - - -
02/28/94 1.12% 11.69% 13.10% - - - - - - - -
03/31/94 -3.36% 9.31% 11.55% - - - - - - - -
04/30/94 -3.54% 9.16% 10.55% - - - - - - - -
05/31/94 -1.58% 8.66% 10.14% - - - - - - - -
06/30/94 -5.44% 9.36% 9.37% - - - - - - - -
07/31/94 -1.68% 8.92% 8.42% - - - - - - - -
08/31/94 1.90% 9.15% 8.95% - - - - - - - -
09/30/94 -0.94% 8.82% 8.36% - - - - - - - -
10/31/94 1.40% 8.34% 9.25% - - - - - - - -
11/30/94 -2.45% 8.26% 7.78% - - - - - - - -
12/31/94 -1.97% 4.24% 7.57% - - - - - - - -
01/31/95 1.33% 5.92% 9.18% - - - - - - - -
02/28/95 5.15% 6.78% 9.70% - - - - - - - -
03/31/95 7.20% 8.71% 9.66% - - - - - - - -
04/30/95 10.54% 10.23% 10.71% - - - - - - - -
05/31/95 14.08% 10.50% 9.55% - - - - - - - -
06/30/95 17.08% 12.56% 10.20% - - - - - - - -
07/31/95 21.63% 12.91% 11.02% - - - - - - - -
08/31/95 20.65% 13.18% 12.66% - - - - - - - -
09/30/95 24.74% 13.68% 14.61% - - - - - - - -
10/31/95 25.33% 13.09% 14.70% - - - - - - - -
11/30/95 30.48% 12.64% 14.52% - - - - - - - -
12/31/95 31.70% 12.51% 14.33% - - - - - - - -
01/31/96 4.86% 13.94% 14.63% - - - - - - - -
02/29/96 5.29% 13.98% 13.36% - - - - - - - -
03/31/96 6.26% 13.54% 13.13% - - - - - - - -
04/30/96 7.54% 15.05% 13.35% - - - - - - - -
05/31/96 10.24% 14.26% 13.15% - - - - - - - -
06/30/96 11.62% 14.81% 14.78% - - - - - - - -
07/31/96 6.09% 13.01% 12.47% - - - - - - - -
08/31/96 8.37% 12.45% 12.28% - - - - - - - -
09/30/96 16.10% 15.22% 14.28% - - - - - - - -
10/31/96 17.43% 15.19% 13.70% - - - - - - - -
11/30/96 25.99% 18.21% 16.15% - - - - - - - -
12/31/96 24.17% 17.02% 13.11% 252.84% 13.43%
01/31/97 6.54% 18.10% 15.35% 238.02% 12.94%
02/28/97 5.93% 18.84% 14.92% 217.58% 12.24%
03/31/97 1.63% 19.00% 14.77% 200.39% 11.62%
04/30/97 8.84% 21.82% 16.60% 225.37% 12.51%
05/31/97 14.54% 23.08% 17.23% 254.23% 13.47%
06/30/97 20.24% 26.77% 19.07% 252.42% 13.41%
07/31/97 30.33% 28.53% 20.31% 256.84% 13.55%
08/31/97 21.35% 24.03% 18.97% 221.66% 12.38%
09/30/97 26.56% 26.97% 19.50% 237.08% 12.91%
10/31/97 24.21% 25.20% 18.57% 323.06% 15.50%
11/30/97 28.71% 28.33% 18.17% 374.70% 16.84%
12/31/97 31.01% 28.88% 18.28% 345.23% 16.09%
- ------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
Institutional Shares
<TABLE>
<CAPTION>
========================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
========================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/90 3.879 0.000000 257.7796 1000.00
01/31/91 4.123 0.000000 257.7796 1062.94
02/28/91 4.404 0.000000 257.7796 1135.37
03/31/91 4.652 0.000000 257.7796 1199.11
04/30/91 4.646 0.000000 257.7796 1197.72
05/31/91 4.957 0.000000 257.7796 1277.77
06/30/91 4.533 0.000000 257.7796 1168.57
07/31/91 4.845 0.000000 257.7796 1249.02
08/31/91 5.177 0.000000 257.7796 1334.63
09/30/91 5.212 0.000000 257.7796 1343.49
10/31/91 5.511 0.000000 257.7796 1420.52
11/30/91 5.316 0.000000 257.7796 1370.29
12/31/91 5.914 0.000000 257.7796 1524.51
01/31/92 6.205 0.000000 257.7796 1599.57
02/28/92 6.283 0.000000 257.7796 1619.63
03/31/92 5.890 0.000000 257.7796 1518.31
04/30/92 5.609 0.000000 257.7796 1445.95
05/31/92 5.515 0.000000 257.7796 1421.71
06/30/92 5.165 0.000000 257.7796 1331.49
07/31/92 5.452 0.000000 257.7796 1405.31
08/31/92 5.246 0.000000 257.7796 1352.38
09/30/92 5.288 0.000000 257.7796 1363.12
10/31/92 5.571 0.000000 257.7796 1435.97
11/30/92 6.056 0.000000 257.7796 1561.24
12/31/92 6.261 0.000000 257.7796 1614.07
01/31/93 6.368 0.000000 257.7796 1641.58
02/28/93 5.891 0.000000 257.7796 1518.69
03/31/93 6.042 0.000000 257.7796 1557.63
04/30/93 5.970 0.000000 257.7796 1538.84
05/31/93 6.372 0.000000 257.7796 1642.62
06/30/93 6.586 0.000000 257.7796 1697.72
07/31/93 6.533 0.000000 257.7796 1684.03
08/31/93 6.976 0.000000 257.7796 1798.28
09/30/93 7.271 0.000000 257.7796 1874.24
10/31/93 7.313 0.000000 257.7796 1885.18
11/30/93 7.035 0.000000 257.7796 1813.43
12/31/93 7.459 0.000000 257.7796 1922.67
01/31/94 7.754 0.000000 257.7796 1998.89
02/28/94 7.811 0.000000 257.7796 2013.56
03/31/94 7.278 0.000000 257.7796 1876.11
04/30/94 7.310 0.000000 257.7796 1884.44
05/31/94 7.055 0.000000 257.7796 1818.75
06/30/94 6.671 0.000000 257.7796 1719.70
07/31/94 6.892 0.000000 257.7796 1776.69
08/31/94 7.556 0.000000 257.7796 1947.86
09/30/94 7.714 0.000000 257.7796 1988.45
10/31/94 7.972 0.000000 257.7796 2055.15
11/30/94 7.586 0.000000 257.7796 1955.55
12/31/94 7.434 0.000000 257.7796 1916.33
01/31/95 7.214 0.000000 257.7796 1859.68
02/28/95 7.497 0.000000 257.7796 1932.47
03/31/95 7.605 0.000000 257.7796 1960.37
04/30/95 7.557 0.000000 257.7796 1948.10
05/31/95 7.600 0.000000 257.7796 1959.09
06/30/95 7.902 0.000000 257.7796 2036.94
07/31/95 8.528 0.000000 257.7796 2198.35
08/31/95 8.777 0.000000 257.7796 2262.41
09/30/95 8.883 0.000000 257.7796 2289.87
10/31/95 8.403 0.000000 257.7796 2166.08
11/30/95 8.685 0.000000 257.7796 2238.73
12/31/95 8.989 0.000000 257.7796 2317.18
01/31/96 8.845 0.000000 257.7796 2279.97
02/29/96 9.507 0.000000 257.7796 2450.83
03/31/96 9.829 0.000000 257.7796 2533.76
04/30/96 10.768 0.000000 257.7796 2775.84
05/31/96 11.244 0.000000 257.7796 2898.36
06/30/96 10.830 0.000000 257.7796 2791.82
07/31/96 10.109 0.000000 257.7796 2606.00
08/31/96 10.711 0.000000 257.7796 2761.16
09/30/96 11.246 0.000000 257.7796 2899.05
10/31/96 10.979 0.000000 257.7796 2830.17
11/30/96 11.387 0.000000 257.7796 2935.28
12/31/96 11.683 0.000000 257.7796 3011.72
01/31/97 11.698 0.000000 257.7796 3015.45
02/28/97 10.620 0.000000 257.7796 2737.56
03/31/97 10.000 0.000000 257.7796 2577.80
04/30/97 10.030 0.000000 257.7796 2585.53
05/31/97 11.540 0.000000 257.7796 2974.78
06/30/97 12.230 0.000000 257.7796 3152.64
07/31/97 12.970 0.000000 257.7796 3343.40
<CAPTION>
=======================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
=======================================================================================================
<S> <C> <C> <C> <C> <C> <C>
12/31/90 - - - - - - - - - - - - - - -
01/31/91 6.29% - - - - - - - - - - - -
02/28/91 6.81% 13.54% - - - - - - - - -
03/31/91 5.61% 12.81% 19.91% - - - - - -
04/30/91 -0.12% 5.49% 12.68% - - - - - -
05/31/91 6.68% 6.56% 12.54% - - - - - -
06/30/91 -8.55% -2.43% -2.55% - - - - - -
07/31/91 6.88% -2.25% 4.28% - - - - - -
08/31/91 6.85% 14.21% 4.45% - - - - - -
09/30/91 0.66% 7.56% 14.97% - - - - - -
10/31/91 5.73% 6.44% 13.73% - - - - - -
11/30/91 -3.54% 2.00% 2.67% - - - - - -
12/31/91 11.25% 7.32% 13.47% 52.45% - - -
01/31/92 4.92% 16.73% 12.60% 50.49% 4.92%
02/28/92 1.25% 6.24% 18.20% 42.65% 6.24%
03/31/92 -6.26% -5.08% -0.41% 26.62% -0.41%
04/30/92 -4.77% -10.72% -9.60% 20.73% -5.15%
05/31/92 -1.68% -6.36% -12.22% 11.26% -6.74%
06/30/92 -6.35% -7.92% -12.30% 13.94% -12.66%
07/31/92 5.54% -1.15% -2.81% 12.51% -7.82%
08/31/92 -3.77% 1.57% -4.88% 1.33% -11.29%
09/30/92 0.79% -3.00% 2.38% 1.46% -10.59%
10/31/92 5.34% 6.18% 2.18% 1.09% -5.81%
11/30/92 8.72% 14.53% 15.44% 13.93% 2.41%
12/31/92 3.38% 12.40% 18.41% 5.88% 5.88%
01/31/93 1.70% 5.15% 14.32% 2.63% 1.70%
02/28/93 -7.49% -5.91% -2.73% -6.23% -5.91%
03/31/93 2.56% -5.11% -3.50% 2.59% -3.50%
04/30/93 -1.21% 1.33% -6.26% 6.42% -4.66%
05/31/93 6.74% 5.46% 8.16% 15.54% 1.77%
06/30/93 3.35% 10.32% 8.99% 27.50% 5.18%
07/31/93 -0.81% 2.52% 9.43% 19.83% 4.33%
08/31/93 6.78% 5.92% 9.48% 32.97% 11.41%
09/30/93 4.22% 11.29% 10.40% 37.50% 16.12%
10/31/93 0.58% 4.83% 11.94% 31.28% 16.80%
11/30/93 -3.81% -3.24% 0.84% 16.15% 12.35%
12/31/93 6.02% 1.99% 2.58% 19.12% 19.12%
01/31/94 3.96% 10.23% 6.03% 21.77% 3.96%
02/28/94 0.73% 4.73% 11.04% 32.59% 4.73%
03/31/94 -6.83% -6.14% -2.42% 20.45% -2.42%
04/30/94 0.44% -6.41% -5.73% 22.46% -1.99%
05/31/94 -3.49% -3.06% -9.67% 10.72% -5.41%
06/30/94 -5.45% -8.74% -8.34% 1.30% -10.56%
07/31/94 3.31% -2.31% -5.72% 5.50% -7.59%
08/31/94 9.63% 13.27% 7.10% 8.32% 1.31%
09/30/94 2.08% 11.92% 15.63% 6.09% 3.42%
10/31/94 3.35% 5.51% 15.67% 9.02% 6.89%
11/30/94 -4.85% -1.65% 0.39% 7.84% 1.71%
12/31/94 -2.01% -6.75% -3.63% -0.33% -0.33%
01/31/95 -2.96% -4.90% -9.51% -6.96% -2.96%
02/28/95 3.91% 0.84% -1.18% -4.03% 0.84%
03/31/95 1.44% 5.41% 2.30% 4.49% 2.30%
04/30/95 -0.63% 0.81% 4.75% 3.38% 1.66%
05/31/95 0.56% -0.07% 1.38% 7.72% 2.23%
06/30/95 3.97% 4.56% 3.91% 18.45% 6.29%
07/31/95 7.92% 12.21% 12.85% 23.73% 14.72%
08/31/95 2.91% 11.07% 15.48% 16.15% 18.06%
09/30/95 1.21% 4.16% 12.42% 15.16% 19.49%
10/31/95 -5.41% -4.26% -1.47% 5.40% 13.03%
11/30/95 3.35% -2.23% -1.05% 14.48% 16.82%
12/31/95 3.50% 6.98% 1.19% 20.92% 20.92%
01/31/96 -1.61% 1.84% 5.26% 22.60% -1.61%
02/29/96 7.49% 5.77% 9.47% 26.82% 5.77%
03/31/96 3.38% 11.13% 9.35% 29.25% 9.35%
04/30/96 9.55% 13.26% 21.75% 42.49% 19.79%
05/31/96 4.41% 14.39% 18.26% 47.94% 25.08%
06/30/96 -3.68% 0.58% 10.18% 37.06% 20.48%
07/31/96 -6.66% -10.09% -6.12% 18.54% 12.46%
08/31/96 5.95% -1.10% -4.73% 22.05% 19.16%
09/30/96 4.99% 11.25% 3.84% 26.60% 25.11%
10/31/96 -2.38% 2.50% 8.60% 30.66% 22.14%
11/30/96 3.71% 1.25% 6.31% 31.11% 26.67%
12/31/96 2.60% 6.41% 3.89% 29.97% 29.97%
01/31/97 0.12% 2.73% 6.55% 32.26% 0.12%
02/28/97 -9.22% -9.10% -6.74% 11.70% -9.10%
03/31/97 -5.84% -14.51% -14.41% 1.74% -14.41%
04/30/97 0.30% -5.55% -14.26% -6.86% -14.15%
05/31/97 15.05% 15.40% 8.67% 2.64% -1.23%
06/30/97 5.98% 21.93% 22.30% 12.92% 4.68%
07/31/97 6.05% 12.39% 29.31% 28.30% 11.01%
<CAPTION>
=======================================================================================
Trailing 3 Yr Trailing 5 Yr Since Inception Trailing Inc.
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
=======================================================================================
<S> <C> <C> <C> <C>
12/31/90 - - - - - - - - - - - - - - - -
01/31/91 - - - - - - - - - - - - - - - -
02/28/91 - - - - - - - - - - - - - - - -
03/31/91 - - - - - - - - - - - - - - - -
04/30/91 - - - - - - - - - - - - - - - -
05/31/91 - - - - - - - - - - - - - - - -
06/30/91 - - - - - - - - - - - - - - - -
07/31/91 - - - - - - - - - - - - - - - -
08/31/91 - - - - - - - - - - - - - - - -
09/30/91 - - - - - - - - - - - - - - - -
10/31/91 - - - - - - - - - - - - - - - -
11/30/91 - - - - - - - - - - - - - - - -
12/31/91 - - - - - - - - - - - - - - - -
01/31/92 - - - - - - - - 59.96% 54.18%
02/28/92 - - - - - - - - 61.96% 51.45%
03/31/92 - - - - - - - - 51.83% 39.69%
04/30/92 - - - - - - - - 44.59% 31.91%
05/31/92 - - - - - - - - 42.17% 28.20%
06/30/92 - - - - - - - - 33.15% 21.05%
07/31/92 - - - - - - - - 40.53% 23.97%
08/31/92 - - - - - - - - 35.24% 19.83%
09/30/92 - - - - - - - - 36.31% 19.36%
10/31/92 - - - - - - - - 43.60% 21.79%
11/30/92 - - - - - - - - 56.12% 26.15%
12/31/92 - - - - - - - - 61.41% 27.00%
01/31/93 - - - - - - - - 64.16% 26.80%
02/28/93 - - - - - - - - 51.87% 21.30%
03/31/93 - - - - - - - - 55.76% 21.78%
04/30/93 - - - - - - - - 53.88% 20.31%
05/31/93 - - - - - - - - 64.26% 22.80%
06/30/93 - - - - - - - - 69.77% 23.59%
07/31/93 - - - - - - - - 68.40% 22.35%
08/31/93 - - - - - - - - 79.83% 24.60%
09/30/93 - - - - - - - - 87.42% 25.66%
10/31/93 - - - - - - - - 88.52% 25.06%
11/30/93 - - - - - - - - 81.34% 22.63%
12/31/93 24.32% - - - - 92.27% 24.32%
01/31/94 23.41% - - - - 99.89% 25.15%
02/28/94 21.02% - - - - 101.36% 24.76%
03/31/94 16.08% - - - - 87.61% 21.37%
04/30/94 16.29% - - - - 88.44% 20.95%
05/31/94 12.48% - - - - 81.88% 19.13%
06/30/94 13.73% - - - - 71.97% 16.76%
07/31/94 12.45% - - - - 77.67% 17.40%
08/31/94 13.42% - - - - 94.79% 19.93%
09/30/94 13.95% - - - - 98.85% 20.11%
10/31/94 13.09% - - - - 105.51% 20.66%
11/30/94 12.57% - - - - 95.56% 18.67%
12/31/94 7.92% - - - - 91.63% 17.64%
01/31/95 5.15% - - - - 85.97% 16.39%
02/28/95 6.06% - - - - 93.25% 17.14%
03/31/95 8.89% - - - - 96.04% 17.16%
04/30/95 10.45% - - - - 94.81% 16.64%
05/31/95 11.28% - - - - 95.91% 16.45%
06/30/95 15.23% - - - - 103.69% 17.13%
07/31/95 16.08% - - - - 119.83% 18.75%
08/31/95 18.71% - - - - 126.24% 19.11%
09/30/95 18.88% - - - - 128.99% 19.05%
10/31/95 14.69% - - - - 116.61% 17.33%
11/30/95 12.77% - - - - 123.87% 17.81%
12/31/95 12.81% 18.29% 131.72% 18.29%
01/31/96 11.57% 16.48% 128.00% 17.59%
02/29/96 17.28% 16.62% 145.08% 18.94%
03/31/96 17.59% 16.12% 153.38% 19.37%
04/30/96 21.71% 18.28% 177.58% 21.09%
05/31/96 20.82% 17.78% 189.84% 21.70%
06/30/96 18.02% 19.00% 179.18% 20.52%
07/31/96 15.65% 15.83% 160.60% 18.70%
08/31/96 15.35% 15.63% 176.12% 19.61%
09/30/96 15.63% 16.61% 189.90% 20.32%
10/31/96 14.49% 14.76% 183.02% 19.51%
11/30/96 17.40% 16.44% 193.53% 19.95%
12/31/96 16.12% 14.57% 201.17% 20.15%
01/31/97 14.67% 13.50% 201.55% 19.87%
02/28/97 10.77% 11.06% 173.76% 17.74%
03/31/97 11.16% 11.16% 157.78% 16.35%
04/30/97 11.11% 12.32% 158.55% 16.18%
05/31/97 17.80% 15.90% 197.48% 18.51%
06/30/97 22.37% 18.80% 215.26% 19.32%
07/31/97 23.44% 18.92% 234.34% 20.11%
</TABLE>
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
Institutional Shares
<TABLE>
<CAPTION>
========================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
========================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/97 12.710 0.000000 257.7796 3276.38
09/30/97 13.760 0.000000 257.7796 3547.05
10/31/97 12.960 0.000000 257.7796 3340.82
11/30/97 12.510 0.000000 257.7796 3224.82
12/31/97 11.930 0.85000 18.366528 276.1461 3294.42
- ----------------------------------------------------------------------------------------
<CAPTION>
=======================================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 9 Months 12 Months to Date
=======================================================================================================
<S> <C> <C> <C> <C> <C> <C>
08/31/97 -2.00% 3.92% 10.14% 18.66% 8.79%
09/30/97 8.26% 6.09% 12.51% 22.35% 17.78%
10/31/97 -5.81% 1.97% -0.08% 18.04% 10.93%
11/30/97 -3.47% -9.08% -1.57% 9.86% 7.08%
12/31/97 2.16% -1.39% -7.12% 27.80% 9.39% 9.39%
- -------------------------------------------------------------------------------------------------------
<CAPTION>
====================================================================================
Trailing 3 Yr Trailing 5 Yr Since Inception Trailing Inc.
Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
====================================================================================
<S> <C> <C> <C> <C>
08/31/97 18.91% 19.35% 227.64% 19.47%
09/30/97 21.26% 21.07% 254.70% 20.62%
10/31/97 17.56% 18.39% 234.08% 19.29%
11/30/97 18.13% 15.60% 222.48% 18.43%
12/31/97 19.77% 15.33% 229.44% 18.55%
- ------------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
Investor Shares
<TABLE>
<CAPTION>
=========================================================================================================================
Dividend Dividend Total Change For/(From)
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months
=========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
12/31/90 3.879 0.000000 257.7796 1,000.00 - - - - - -
01/31/91 4.123 0.000000 257.7796 1,062.94 6.29% - - -
02/28/91 4.404 0.000000 257.7796 1,135.37 6.81% 13.54%
03/31/91 4.652 0.000000 257.7796 1,199.11 5.61% 12.81%
04/30/91 4.646 0.000000 257.7796 1,197.72 -0.12% 5.49%
05/31/91 4.957 0.000000 257.7796 1,277.77 6.68% 6.56%
06/30/91 4.533 0.000000 257.7796 1,168.57 -8.55% -2.43%
07/31/91 4.845 0.000000 257.7796 1,249.02 6.88% -2.25%
08/31/91 5.177 0.000000 257.7796 1,334.63 6.85% 14.21%
09/30/91 5.212 0.000000 257.7796 1,343.49 0.66% 7.56%
10/31/91 5.511 0.000000 257.7796 1,420.52 5.73% 6.44%
11/30/91 5.316 0.000000 257.7796 1,370.29 -3.54% 2.00%
12/31/91 5.914 0.000000 257.7796 1,524.51 11.25% 7.32%
01/31/92 6.205 0.000000 257.7796 1,599.57 4.92% 16.73%
02/28/92 6.283 0.000000 257.7796 1,619.63 1.25% 6.24%
03/31/92 5.890 0.000000 257.7796 1,518.31 -6.26% -5.08%
04/30/92 5.609 0.000000 257.7796 1,445.95 -4.77% -10.72%
05/31/92 5.515 0.000000 257.7796 1,421.71 -1.68% -6.36%
06/30/92 5.165 0.000000 257.7796 1,331.49 -6.35% -7.92%
07/31/92 5.452 0.000000 257.7796 1,405.31 5.54% -1.15%
08/31/92 5.246 0.000000 257.7796 1,352.38 -3.77% 1.57%
09/30/92 5.288 0.000000 257.7796 1,363.12 0.79% -3.00%
10/31/92 5.571 0.000000 257.7796 1,435.97 5.34% 6.18%
11/30/92 6.056 0.000000 257.7796 1,561.24 8.72% 14.53%
12/31/92 6.261 0.000000 257.7796 1,614.07 3.38% 12.40%
01/31/93 6.368 0.000000 257.7796 1,641.58 1.70% 5.15%
02/28/93 5.891 0.000000 257.7796 1,518.69 -7.49% -5.91%
03/31/93 6.042 0.000000 257.7796 1,557.63 2.56% -5.11%
04/30/93 5.970 0.000000 257.7796 1,538.84 -1.21% 1.33%
05/31/93 6.372 0.000000 257.7796 1,642.62 6.74% 5.46%
06/30/93 6.586 0.000000 257.7796 1,697.72 3.35% 10.32%
07/31/93 6.533 0.000000 257.7796 1,684.03 -0.81% 2.52%
08/31/93 6.976 0.000000 257.7796 1,798.28 6.78% 5.92%
09/30/93 7.271 0.000000 257.7796 1,874.24 4.22% 11.29%
10/31/93 7.313 0.000000 257.7796 1,885.18 0.58% 4.83%
11/30/93 7.035 0.000000 257.7796 1,813.43 -3.81% -3.24%
12/31/93 7.459 0.000000 257.7796 1,922.67 6.02% 1.99%
01/31/94 7.754 0.000000 257.7796 1,998.89 3.96% 10.23%
02/28/94 7.811 0.000000 257.7796 2,013.56 0.73% 4.73%
03/31/94 7.278 0.000000 257.7796 1,876.11 -6.83% -6.14%
04/30/94 7.310 0.000000 257.7796 1,884.44 0.44% -6.41%
05/31/94 7.055 0.000000 257.7796 1,818.75 -3.49% -3.06%
06/30/94 6.671 0.000000 257.7796 1,719.70 -5.45% -8.74%
07/31/94 6.892 0.000000 257.7796 1,776.69 3.31% -2.31%
08/31/94 7.556 0.000000 257.7796 1,947.86 9.63% 13.27%
09/30/94 7.714 0.000000 257.7796 1,988.45 2.08% 11.92%
10/31/94 7.972 0.000000 257.7796 2,055.15 3.35% 5.51%
11/30/94 7.586 0.000000 257.7796 1,955.55 -4.85% -1.65%
12/31/94 7.434 0.000000 257.7796 1,916.33 -2.01% -6.75%
01/31/95 7.214 0.000000 257.7796 1,859.68 -2.96% -4.90%
02/28/95 7.497 0.000000 257.7796 1,932.47 3.91% 0.84%
03/31/95 7.605 0.000000 257.7796 1,960.37 1.44% 5.41%
04/30/95 7.557 0.000000 257.7796 1,948.10 -0.63% 0.81%
05/31/95 7.600 0.000000 257.7796 1,959.09 0.56% -0.07%
06/30/95 7.902 0.000000 257.7796 2,036.94 3.97% 4.56%
07/31/95 8.528 0.000000 257.7796 2,198.35 7.92% 12.21%
08/31/95 8.777 0.000000 257.7796 2,262.41 2.91% 11.07%
09/30/95 8.883 0.000000 257.7796 2,289.87 1.21% 4.16%
10/31/95 8.403 0.000000 257.7796 2,166.08 -5.41% -4.26%
11/30/95 8.685 0.000000 257.7796 2,238.73 3.35% -2.23%
12/31/95 8.989 0.000000 257.7796 2,317.18 3.50% 6.98%
01/31/96 8.845 0.000000 257.7796 2,279.97 -1.61% 1.84%
02/29/96 9.507 0.000000 257.7796 2,450.83 7.49% 5.77%
03/31/96 9.829 0.000000 257.7796 2,533.76 3.38% 11.13%
04/30/96 10.768 0.000000 257.7796 2,775.84 9.55% 13.26%
05/31/96 11.244 0.000000 257.7796 2,898.36 4.41% 14.39%
06/30/96 10.830 0.000000 257.7796 2,791.82 -3.68% 0.58%
07/31/96 10.109 0.000000 257.7796 2,606.00 -6.66% -10.09%
08/31/96 10.711 0.000000 257.7796 2,761.16 5.95% -1.10%
09/30/96 11.246 0.000000 257.7796 2,899.05 4.99% 11.25%
10/31/96 10.979 0.000000 257.7796 2,830.17 -2.38% 2.50%
11/30/96 11.387 0.000000 257.7796 2,935.28 3.71% 1.25%
12/31/96 11.683 0.000000 257.7796 3,011.72 2.60% 6.41%
01/31/97 11.698 0.000000 257.7796 3,015.45 0.12% 2.73%
02/28/97 10.620 0.000000 257.7796 2,737.56 -9.22% -9.10%
03/31/97 10.000 0.000000 257.7796 2,577.80 -5.84% -14.51%
04/30/97 10.030 0.000000 257.7796 2,585.53 0.30% -5.55%
05/31/97 11.540 0.000000 257.7796 2,974.78 15.05% 15.40%
06/30/97 12.230 0.000000 257.7796 3,152.64 5.98% 21.93%
<CAPTION>
===========================================================================================================================
Change For/(From) Year Trailing 3 Yr Trailing 5 Yr Since Inception Trailing Inc.
Date 3 Months 8 Months 12 Months to Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
12/31/90 - - - - - - - - - - - - - - - - - - - - - - - - -
01/31/91 - - - - - - 6.29% - - - - - - - - - - - - - - - -
02/28/91 - - - - - - 13.54% - - - - - - - - - - - - - - - -
03/31/91 19.91% - - - 19.91% - - - - - - - - - - - - - - - -
04/30/91 12.68% - - - 19.77% - - - - - - - - - - - - - - - -
05/31/91 12.54% - - - 27.78% - - - - - - - - - - - - - - - -
06/30/91 -2.55% - - - 16.86% - - - - - - - - - - - - - - - -
07/31/91 4.28% - - - 24.90% - - - - - - - - - - - - - - - -
08/31/91 4.45% - - - 33.46% - - - - - - - - - - - - - - - -
09/30/91 14.97% - - - 34.35% - - - - - - - - - - - - - - - -
10/31/91 13.73% - - - 42.05% - - - - - - - - - - - - - - - -
11/30/91 2.67% - - - 37.03% - - - - - - - - - - - - - - - -
12/31/91 13.47% 52.45% 52.45% - - - - - - - - 52.45% 52.45%
01/31/92 12.60% 50.49% 4.92% - - - - - - - - 59.96% 54.18%
02/28/92 18.20% 42.65% 6.24% - - - - - - - - 61.96% 51.45%
03/31/92 -0.41% 26.62% -0.41% - - - - - - - - 51.83% 39.69%
04/30/92 -9.60% 20.73% -5.15% - - - - - - - - 44.59% 31.91%
05/31/92 -12.22% 11.26% -6.74% - - - - - - - - 42.17% 28.20%
06/30/92 -12.30% 13.94% -12.66% - - - - - - - - 33.15% 21.05%
07/31/92 -2.81% 12.51% -7.82% - - - - - - - - 40.53% 23.97%
08/31/92 -4.88% 1.33% -11.29% - - - - - - - - 35.24% 19.83%
09/30/92 2.38% 1.46% -10.59% - - - - - - - - 36.31% 19.36%
10/31/92 2.18% 1.09% -5.81% - - - - - - - - 43.60% 21.79%
11/30/92 15.44% 13.93% 2.41% - - - - - - - - 56.12% 26.15%
12/31/92 18.41% 5.88% 5.88% - - - - - - - - 61.41% 27.00%
01/31/93 14.32% 2.63% 1.70% - - - - - - - - 64.16% 26.80%
02/28/93 -2.73% -6.23% -5.91% - - - - - - - - 51.87% 21.30%
03/31/93 -3.50% 2.59% -3.50% - - - - - - - - 55.76% 21.78%
04/30/93 -6.26% 6.42% -4.66% - - - - - - - - 53.88% 20.31%
05/31/93 8.16% 15.54% 1.77% - - - - - - - - 64.26% 22.80%
06/30/93 8.99% 27.50% 5.18% - - - - - - - - 69.77% 23.59%
07/31/93 9.43% 19.83% 4.33% - - - - - - - - 68.40% 22.35%
08/31/93 9.48% 32.97% 11.41% - - - - - - - - 79.83% 24.60%
09/30/93 10.40% 37.50% 16.12% - - - - - - - - 87.42% 25.66%
10/31/93 11.94% 31.28% 16.80% - - - - - - - - 88.52% 25.06%
11/30/93 0.84% 16.15% 12.35% - - - - - - - - 81.34% 22.63%
12/31/93 2.58% 19.12% 19.12% 24.32% - - - - 92.27% 24.32%
01/31/94 6.03% 21.77% 3.96% 23.41% - - - - 99.89% 25.15%
02/28/94 11.04% 32.59% 4.73% 21.02% - - - - 101.36% 24.76%
03/31/94 -2.42% 20.45% -2.42% 16.08% - - - - 87.61% 21.37%
04/30/94 -5.73% 22.46% -1.99% 16.29% - - - - 88.44% 20.95%
05/31/94 -9.67% 10.72% -5.41% 12.48% - - - - 81.88% 19.13%
06/30/94 -8.34% 1.30% -10.56% 13.73% - - - - 71.97% 16.76%
07/31/94 -5.72% 5.50% -7.59% 12.45% - - - - 77.67% 17.40%
08/31/94 7.10% 8.32% 1.31% 13.42% - - - - 94.79% 19.93%
09/30/94 15.63% 6.09% 3.42% 13.95% - - - - 98.85% 20.11%
10/31/94 15.67% 9.02% 6.89% 13.09% - - - - 105.51% 20.66%
11/30/94 0.39% 7.84% 1.71% 12.57% - - - - 95.56% 18.67%
12/31/94 -3.63% -0.33% -0.33% 7.92% - - - - 91.63% 17.64%
01/31/95 -9.51% -6.96% -2.96% 5.15% - - - - 85.97% 16.39%
02/28/95 -1.18% -4.03% 0.84% 6.06% - - - - 93.25% 17.14%
03/31/95 2.30% 4.49% 2.30% 8.89% - - - - 96.04% 17.16%
04/30/95 4.75% 3.38% 1.66% 10.45% - - - - 94.81% 16.64%
05/31/95 1.38% 7.72% 2.23% 11.28% - - - - 95.91% 16.45%
06/30/95 3.91% 18.45% 6.29% 15.23% - - - - 103.69% 17.13%
07/31/95 12.85% 23.73% 14.72% 16.08% - - - - 119.83% 18.75%
08/31/95 15.48% 16.15% 18.06% 18.71% - - - - 126.24% 19.11%
09/30/95 12.42% 15.16% 19.49% 18.88% - - - - 128.99% 19.05%
10/31/95 -1.47% 5.40% 13.03% 14.69% - - - - 116.61% 17.33%
11/30/95 -1.05% 14.48% 16.82% 12.77% - - - - 123.87% 17.81%
12/31/95 1.19% 20.92% 20.92% 12.81% 18.29% 131.72% 18.29%
01/31/96 5.26% 22.60% -1.61% 11.57% 16.48% 128.00% 17.59%
02/29/96 9.47% 26.82% 5.77% 17.28% 16.62% 145.08% 18.94%
03/31/96 9.35% 29.25% 9.35% 17.59% 16.12% 153.38% 19.37%
04/30/96 21.75% 42.49% 19.79% 21.71% 18.28% 177.58% 21.09%
05/31/96 18.26% 47.94% 25.08% 20.82% 17.78% 189.84% 21.70%
06/30/96 10.18% 37.06% 20.48% 18.02% 19.00% 179.18% 20.52%
07/31/96 -6.12% 18.54% 12.46% 15.65% 15.83% 160.60% 18.70%
08/31/96 -4.73% 22.05% 19.16% 15.35% 15.63% 176.12% 19.61%
09/30/96 3.84% 26.60% 25.11% 15.63% 16.61% 189.90% 20.32%
10/31/96 8.60% 30.66% 22.14% 14.49% 14.76% 183.02% 19.51%
11/30/96 6.31% 31.11% 26.67% 17.40% 16.44% 193.53% 19.95%
12/31/96 3.89% 29.97% 29.97% 16.12% 14.57% 201.17% 20.15%
01/31/97 6.55% 32.26% 0.12% 14.67% 13.50% 201.55% 19.87%
02/28/97 -6.74% 11.70% -9.10% 10.77% 11.06% 173.76% 17.74%
03/31/97 -14.41% 1.74% -14.41% 11.16% 11.16% 157.78% 16.35%
04/30/97 -14.26% -6.86% -14.15% 11.11% 12.32% 158.55% 16.18%
05/31/97 8.67% 2.64% -1.23% 17.80% 15.90% 197.48% 18.51%
06/30/97 22.30% 12.92% 4.68% 22.37% 18.80% 215.26% 19.32%
</TABLE>
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
Investor Shares
<TABLE>
<CAPTION>
=========================================================================================================================
Dividend Dividend Total Change For/(From)
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months
=========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
07/31/97 12.970 0.000000 257.7796 3,343.40 6.05% 12.39%
08/31/97 12.730 0.000000 257.7796 3,281.53 -1.85% 4.09%
09/30/97 13.780 0.000000 257.7796 3,552.20 8.25% 6.25%
10/31/97 12.980 0.000000 257.7796 3,345.98 -5.81% 1.96%
11/30/97 12.520 0.000000 257.7796 3,227.40 -3.54% -9.14%
12/31/97 11.940 0.85000 18.351145 276.1308 3,297.00 2.16% -1.46%
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
===========================================================================================================================
Change For/(From) Year Trailing 3 Yr Trailing 5 Yr Since Inception Trailing Inc.
Date 3 Months 8 Months 12 Months to Date Avg.Ann.Rtn. Avg.Ann.Rtn. Total Return Avg.Ann.Rtn.
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
07/31/97 29.31% 28.30% 11.01% 23.44% 18.92% 234.34% 20.11%
08/31/97 10.31% 18.85% 8.96% 18.97% 19.39% 228.15% 19.50%
09/30/97 12.67% 22.53% 17.95% 21.32% 21.10% 255.22% 20.65%
10/31/97 0.08% 18.23% 11.10% 17.62% 18.42% 234.60% 19.32%
11/30/97 -1.65% 9.95% 7.16% 18.16% 15.62% 222.74% 18.45%
12/31/97 -7.18% 27.52% 9.47% 9.47% 19.81% 15.35% 229.70% 18.57%
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
INSTITUTIONAL SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
<TABLE>
<CAPTION>
================================================================================
Dividend Dividend Total Extended
Date NAV Regular Cap Gain Shares Shares Value
================================================================================
<S> <C> <C> <C> <C> <C> <C>
04/01/97 10.00 100.0000 1,000.00
04/30/97 10.19 0.000000 100.0000 1,019.00
05/31/97 10.82 0.000000 100.0000 1,082.00
06/30/97 11.33 0.000000 100.0000 1,133.00
07/31/97 11.82 0.000000 100.0000 1,182.00
08/31/97 10.79 0.000000 100.0000 1,079.00
09/30/97 11.55 0.000000 100.0000 1,155.00
10/31/97 10.67 0.000000 100.0000 1,067.00
11/30/97 10.63 0.000000 100.0000 1,063.00
12/31/97 10.69 0.000000 100.0000 1,069.00
- --------------------------------------------------------------------------------
<CAPTION>
================================================================================
Change For/(From) Year
Date 1 Month 2 Months 3 Months 12 Months to Date
================================================================================
<S> <C> <C> <C> <C> <C>
04/01/97 - - - - - - - - - - - - - - -
04/30/97 1.90% - - - - - - - - - - - -
05/31/97 6.18% 8.20% - - - - - - - - -
06/30/97 4.71% 11.19% 13.30% - - - - - -
07/31/97 4.32% 9.24% 16.00% - - - - - -
08/31/97 -8.71% -4.77% -0.28% - - - - - -
09/30/97 7.04% -2.28% 1.94% - - - - - -
10/31/97 -7.62% -1.11% -9.73% - - - - - -
11/30/97 -0.37% -7.97% -1.48% - - - - - -
12/31/97 0.56% 0.19% -7.45% - - - 6.90%
- --------------------------------------------------------------------------------
<CAPTION>
================================================================================
Trailing Trailing 3 Yr Total Since Avg.Ann.Rtn.
Date 3 Years Avg.Ann.Rtn. Inception Since Inc.
================================================================================
<S> <C> <C> <C> <C>
04/01/97 - - - - - - - - - - - - - - - -
04/30/97 - - - - - - - - 1.90% - - - -
05/31/97 - - - - - - - - 8.20% - - - -
06/30/97 - - - - - - - - 13.30% - - - -
07/31/97 - - - - - - - - 18.20% - - - -
08/31/97 - - - - - - - - 7.90% - - - -
09/30/97 - - - - - - - - 15.50% - - - -
10/31/97 - - - - - - - - 6.70% - - - -
11/30/97 - - - - - - - - 6.30% - - - -
12/31/97 - - - - - - - - 6.90% 9.26%
- --------------------------------------------------------------------------------
</TABLE>
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
INVESTOR SHARES
Input Range and Calculation of Change in Value
(DOES NOT CONSIDER EFFECT OF THE SALES LOAD)
<TABLE>
<CAPTION>
====================================================================================================================================
Dividend Dividend Total Extended Change For/(From) Year
Date NAV Regular Cap Gain Shares Shares Value 1 Month 2 Months 3 Months 12 Months to Date
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
04/01/97 10.0000 98.1354 981.35 - - - - - - - - - - - - - - -
04/30/97 10.19 98.1354 1,000.00 1.90% - - - - - - - - - - - -
05/31/97 10.75 0.000000 98.1354 1,054.96 5.50% 7.50% - - - - - - - - -
06/30/97 11.31 0.000000 98.1354 1,109.91 5.21% 10.99% - - - - - - - - -
07/31/97 11.80 0.000000 98.1354 1,158.00 4.33% 9.77% 15.80% - - - - - -
08/31/97 10.77 0.000000 98.1354 1,056.92 -8.73% -4.77% 0.19% - - - - - -
09/30/97 11.53 0.000000 98.1354 1,131.50 7.06% -2.29% 1.95% - - - - - -
10/31/97 10.64 0.000000 98.1354 1,044.16 -7.72% -1.21% -9.83% - - - - - -
11/30/97 10.60 0.000000 98.1354 1,040.24 -0.38% -8.07% -1.58% - - - - - -
12/31/97 10.66 0.000000 98.1354 1,046.12 0.57% 0.19% -7.55% - - - 6.60%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
====================================================================================
Trailing Trailing 3 Yr Total Since Avg.Ann.Rtn.
Date 3 Years Avg.Ann.Rtn. Inception Since Inc.
====================================================================================
<S> <C> <C> <C> <C>
04/01/97 - - - - - - - - - - - - - - - -
04/30/97 - - - - - - - - - - - - - - - -
05/31/97 - - - - - - - - 7.50% - - - -
06/30/97 - - - - - - - - 13.10% - - - -
07/31/97 - - - - - - - - 18.00% - - - -
08/31/97 - - - - - - - - 7.70% - - - -
09/30/97 - - - - - - - - 15.30% - - - -
10/31/97 - - - - - - - - 6.40% - - - -
11/30/97 - - - - - - - - 6.00% - - - -
12/31/97 - - - - - - - - 6.60% 8.85%
- ------------------------------------------------------------------------------------
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000887318
<NAME> BNY HAMILTON MONEY FUND
<SERIES>
<NUMBER> 013
<NAME> HAMILTON SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 1,767,447,906
<INVESTMENTS-AT-VALUE> 1,767,447,906
<RECEIVABLES> 6,602,111
<ASSETS-OTHER> 103,813
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,774,153,830
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,511,392
<TOTAL-LIABILITIES> 5,511,392
<SENIOR-EQUITY> 1,768,629
<PAID-IN-CAPITAL-COMMON> 1,766,860,147
<SHARES-COMMON-STOCK> 1,063,570,528
<SHARES-COMMON-PRIOR> 609,424,033
<ACCUMULATED-NII-CURRENT> 13,662
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,063,578,744
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 76,259,992
<OTHER-INCOME> 0
<EXPENSES-NET> 4,919,572
<NET-INVESTMENT-INCOME> 71,340,420
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 71,340,420
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (42,331,939)
<DISTRIBUTIONS-OF-GAINS> (8,151)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,379,741,425
<NUMBER-OF-SHARES-REDEEMED> (2,929,817,113)
<SHARES-REINVESTED> 4,222,183
<NET-CHANGE-IN-ASSETS> 681,981,560
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,364,166
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,948,723
<AVERAGE-NET-ASSETS> 792,719,908
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .053
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.053)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000887318
<NAME> BNY HAMILTON MONEY FUND
<SERIES>
<NUMBER> 012
<NAME> HAMILTON PREMIER SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 1,767,447,906
<INVESTMENTS-AT-VALUE> 1,767,447,906
<RECEIVABLES> 6,602,111
<ASSETS-OTHER> 103,813
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,774,153,830
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,511,392
<TOTAL-LIABILITIES> 5,511,392
<SENIOR-EQUITY> 1,768,629
<PAID-IN-CAPITAL-COMMON> 1,766,860,147
<SHARES-COMMON-STOCK> 688,333,863
<SHARES-COMMON-PRIOR> 463,758,450
<ACCUMULATED-NII-CURRENT> 13,662
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 688,339,180
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 76,259,992
<OTHER-INCOME> 0
<EXPENSES-NET> 4,919,572
<NET-INVESTMENT-INCOME> 71,340,420
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 71,340,420
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (28,179,930)
<DISTRIBUTIONS-OF-GAINS> (5,383)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 5,351,767,320
<NUMBER-OF-SHARES-REDEEMED> (5,142,031,650)
<SHARES-REINVESTED> 14,839,743
<NET-CHANGE-IN-ASSETS> 681,981,560
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,364,166
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,948,723
<AVERAGE-NET-ASSETS> 554,302,335
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .051
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.051)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .51
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000887318
<NAME> BNY HAMILTON MONEY FUND
<SERIES>
<NUMBER> 011
<NAME> HAMILTON CLASSIC SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 1,767,447,906
<INVESTMENTS-AT-VALUE> 1,767,447,906
<RECEIVABLES> 6,602,111
<ASSETS-OTHER> 103,813
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,774,153,830
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,511,392
<TOTAL-LIABILITIES> 5,511,392
<SENIOR-EQUITY> 1,768,629
<PAID-IN-CAPITAL-COMMON> 1,766,860,147
<SHARES-COMMON-STOCK> 16,724,385
<SHARES-COMMON-PRIOR> 13,478,395
<ACCUMULATED-NII-CURRENT> 13,662
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 16,724,514
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 76,259,992
<OTHER-INCOME> 0
<EXPENSES-NET> 4,919,572
<NET-INVESTMENT-INCOME> 71,340,420
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 71,340,420
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (801,227)
<DISTRIBUTIONS-OF-GAINS> (128)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 27,744,272
<NUMBER-OF-SHARES-REDEEMED> (25,199,060)
<SHARES-REINVESTED> 700,778
<NET-CHANGE-IN-ASSETS> 681,981,560
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,364,166
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,948,723
<AVERAGE-NET-ASSETS> 17,013,495
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .047
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.047)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .88
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000887318
<NAME> BNY HAMILTON TREASURY MONEY FUND
<SERIES>
<NUMBER> 101
<NAME> HAMILTON SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 294,862,743
<INVESTMENTS-AT-VALUE> 294,862,743
<RECEIVABLES> 209,281
<ASSETS-OTHER> 59,150
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 295,131,174
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 517,237
<TOTAL-LIABILITIES> 517,237
<SENIOR-EQUITY> 294,614
<PAID-IN-CAPITAL-COMMON> 294,320,006
<SHARES-COMMON-STOCK> 110,719,481
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (683)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 110,719,396
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 5,031,581
<OTHER-INCOME> 0
<EXPENSES-NET> 389,635
<NET-INVESTMENT-INCOME> 4,641,946
<REALIZED-GAINS-CURRENT> (683)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 4,641,263
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,347,411)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 213,597,568
<NUMBER-OF-SHARES-REDEEMED> (103,974,807)
<SHARES-REINVESTED> 1,096,720
<NET-CHANGE-IN-ASSETS> 294,613,937
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 90,633
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 451,631
<AVERAGE-NET-ASSETS> 33,800,431
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .040
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.040)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000887318
<NAME> BNY HAMILTON TREASURY MONEY FUND
<SERIES>
<NUMBER> 102
<NAME> HAMILTON PREMIER SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 294,862,743
<INVESTMENTS-AT-VALUE> 294,862,743
<RECEIVABLES> 209,281
<ASSETS-OTHER> 59,150
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 295,131,174
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 517,237
<TOTAL-LIABILITIES> 517,237
<SENIOR-EQUITY> 294,614
<PAID-IN-CAPITAL-COMMON> 294,320,006
<SHARES-COMMON-STOCK> 183,895,139
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (683)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 183,894,541
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 5,031,581
<OTHER-INCOME> 0
<EXPENSES-NET> 389,635
<NET-INVESTMENT-INCOME> 4,641,946
<REALIZED-GAINS-CURRENT> (683)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 4,641,263
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (3,294,535)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 880,125,419
<NUMBER-OF-SHARES-REDEEMED> (697,926,012)
<SHARES-REINVESTED> 1,695,732
<NET-CHANGE-IN-ASSETS> 294,613,937
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 90,633
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 451,631
<AVERAGE-NET-ASSETS> 86,478,004
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .038
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.038)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000887318
<NAME> BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
<SERIES>
<NUMBER> 021
<NAME> INVESTOR SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 72,900,667
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<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 74,797,380
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<OTHER-ITEMS-LIABILITIES> 211,306
<TOTAL-LIABILITIES> 211,306
<SENIOR-EQUITY> 7,553
<PAID-IN-CAPITAL-COMMON> 76,557,456
<SHARES-COMMON-STOCK> 1,059,461
<SHARES-COMMON-PRIOR> 6,609,815
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> (83,033)
<ACCUMULATED-NET-GAINS> (2,878,731)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 982,829
<NET-ASSETS> 10,458,472
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 4,523,391
<OTHER-INCOME> 0
<EXPENSES-NET> 651,557
<NET-INVESTMENT-INCOME> 3,871,834
<REALIZED-GAINS-CURRENT> (473,862)
<APPREC-INCREASE-CURRENT> 1,756,995
<NET-CHANGE-FROM-OPS> 5,154,967
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,299,587)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 657,553
<NUMBER-OF-SHARES-REDEEMED> (6,283,195)
<SHARES-REINVESTED> 75,288
<NET-CHANGE-IN-ASSETS> 10,469,502
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (2,645,156)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 338,557
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 699,272
<AVERAGE-NET-ASSETS> 23,326,953
<PER-SHARE-NAV-BEGIN> 9.70
<PER-SHARE-NII> .54
<PER-SHARE-GAIN-APPREC> .17
<PER-SHARE-DIVIDEND> (.54)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.87
<EXPENSE-RATIO> 1.08
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000887318
<NAME> BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
<SERIES>
<NUMBER> 022
<NAME> INSTITUTIONAL SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 72,900,667
<INVESTMENTS-AT-VALUE> 73,883,496
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<OTHER-ITEMS-LIABILITIES> 211,306
<TOTAL-LIABILITIES> 211,306
<SENIOR-EQUITY> 7,553
<PAID-IN-CAPITAL-COMMON> 76,557,456
<SHARES-COMMON-STOCK> 6,493,079
<SHARES-COMMON-PRIOR> 0
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