THE SHAWMUT FUNDS
- --------------------------------------------------------------------------------
SUPPLEMENT TO THE PROSPECTUSES DATED DECEMBER 31, 1994
1. At a Special Meeting of the Shareholders of all of the portfolios of
The Shawmut Funds held on
October 30, 1995, an Agreement and Plan of Reorganization (the
"Reorganization Agreement") was approved between The Shawmut Funds and
the Galaxy Fund, another open-end management investment company.
Approval of the Reorganization Agreement was sought in connection
with: (1) the transfer of substantially all of the assets and
liabilities of Shawmut Growth Equity Fund, Shawmut Prime Money Market
Fund, Shawmut Limited Term Income Fund, Shawmut Fixed Income Fund,
Shawmut Intermediate Government Income Fund, Shawmut Connecticut
Intermediate Municipal Income Fund, and Massachusetts Intermediate
Municipal Income Fund, and the transfer of all the assets and
liabilities of Shawmut Growth and Income Equity Fund, Shawmut Small
Capitalization Equity Fund, Shawmut Connecticut Municipal Money Market
Fund and Shawmut Massachusetts Municipal Money Market Fund, to
corresponding investment funds of the Galaxy Fund in exchange for
shares of the Galaxy Fund; and (2) the distribution of the Galaxy
Fund's shares so received to shareholders of The Shawmut Funds.
2. Please be advised that Michael M. Spencer, the portfolio manager of
Shawmut Intermediate Government Income Fund from April 1993 through
August 1, 1995, has been succeeded in that position by Maximillian J.
Brenninkmeyer. Mr. Brenninkmeyer has also served as the portfolio
manager for Shawmut Fixed Income Fund since its inception in December
1992.
3. Please delete the section entitled "Expense Summary" in the Shawmut
Income Funds-- Trust Shares Prospectus and replace it with the
following:
THE SHAWMUT INCOME FUNDS
Expense Summary Trust Shares
<TABLE>
<CAPTION>
PORTFOLIOS
- ------------------------------------------------------------------------------------------------------------------------------------
LIMITED INTERMEDIATE CONNECTICUT MASSACHUSETTS
TERM GOVERNMENT FIXED INTERMEDIATE INTERMEDIATE
INCOME INCOME INCOME MUNICIPAL MUNICIPAL
FUND FUND FUND INCOME FUND** INCOME FUND**
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) None None None None* None*
Maximum Sales Load Imposed on Reinvested
Dividends (as a percentage of offering
price) None None None None None
Contingent Deferred Sales Charge (as a
percentage of original purchase price
or redemption proceeds as applicable) None None None None None
Redemption Fee (as a percentage of
amount
redeemed, if applicable) None None None None None
Exchange Fee None None None None None
ANNUAL TRUST SHARES OPERATING EXPENSES
(As a percentage of average net assets)
Management Fee (after fee waivers)(1) 0.62% 0.65% 0.63% 0.01% 0.02%
Shareholder Servicing Fee None None None None None
12b-1 Fees(2) None None None 0.00% 0.00%
Total Other Expenses (after fee waivers
and/or
expense reimbursements)(3) 0.54% 0.46% 0.35% 0.50% 0.50%
Total Trust Shares Operating Expenses
(after fee waivers and/or expense
reimbursements)(4) 1.16% 1.11% 0.98% 0.51% 0.52%
</TABLE>
(1) The maximum management fee is 0.70% for the Connecticut Intermediate
Municipal Income Fund and Massachusetts Intermediate Municipal Income Fund;
and 0.80% for Trust Shares of Fixed Income Fund, Intermediate Government
Income Fund, and Limited Term Income Fund.
(2) The Connecticut Intermediate Municipal Income Fund and Massachusetts
Intermediate Municipal Income Fund do not intend to accrue or pay 12b-1 fees
until either a separate class of shares has been created for fiduciary
investors for those Funds or a determination is made that such investors
will be subject to 12b-1 fees. The Connecticut Intermediate Municipal Income
Fund and Massachusetts Intermediate Municipal Income Fund can pay up to
0.50% of its average daily net assets as a 12b-1 fee to its distributor.
(3) Other expenses for Trust Shares have been reduced to reflect the voluntary
waiver of fees by that Fund's custodian; and reimbursement by the adviser
for the Connecticut Intermediate Municipal Income Fund and the Massachusetts
Intermediate Municipal Income Fund.
(4) Absent the voluntary waivers and reimbursements explained in the above
footnotes, which can be terminated at any time, the Operating Expenses of
the Trust Shares are 3.30% for the Connecticut Intermediate Municipal Income
Fund; 3.10% for the Massachusetts Intermediate Municipal Income Fund; 1.17%
for the Fixed Income Fund; 1.29% for the Intermediate Government Income
Fund; and 1.37% for the Limited Term Income Fund.
* Shares of these funds purchased by or for accounts in which the trust
department of Shawmut Bank, N.A., or its affiliates, serve in a fiduciary or
agency capacity are sold without a sales load. Other purchasers pay a sales
load of up to 2.00% of the public offering price, as described in the Income
Funds--Investment Shares prospectus.
** Connecticut Intermediate Municipal Income Fund and Massachusetts
Intermediate Municipal Income Fund currently sell their shares without class
designation.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of Trust Shares will bear, either directly
or indirectly. For more complete descriptions of the various costs and expenses,
see "Administration" and "Investing in Shares." Wire-transferred redemptions of
less than $5,000 may be subject to additional fees.
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 the following periods:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Limited Term Income Fund........................................................ $12 $37 $64 $141
Intermediate Government Income Fund............................................. $11 $35 $61 $135
Fixed Income Fund............................................................... $10 $31 $54 $120
Connecticut Intermediate Municipal Income Fund.................................. $ 5 $16 $29 $ 64
Massachusetts Intermediate Municipal Income Fund................................ $ 5 $17 $29 $ 65
</TABLE>
THE ABOVE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The information set forth in the foregoing table and example relates only to
Trust Shares of the Income Funds. Fixed Income Fund, Intermediate Government
Income Fund, and Limited Term Income Fund also offer another class of shares
called Investment Shares. Trust Shares and Investment Shares are subject to
certain of the same expenses; however, Investment Shares are subject to a 12b-1
fee of up to .50 of 1% of average net assets. See "Other Classes of Shares."
4. Please delete the section entitled "Expense Summary" in the Shawmut
Income Funds-- Investment Shares Prospectus and replace it with the
following:
THE SHAWMUT INCOME FUNDS
Expense Summary Investment Shares
<TABLE>
<CAPTION>
PORTFOLIOS
- ------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT
LIMITED INTERMEDIATE INTERMEDIATE
TERM GOVERNMENT FIXED MUNICIPAL
INCOME INCOME INCOME INCOME
FUND FUND FUND FUND*
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) 2.00% 2.00% 2.00% 2.00%
Maximum Sales Load Imposed on Reinvested
Dividends
(as a percentage of offering price) None None None None
Contingent Deferred Sales Charge (as a percentage
of
original purchase price or redemption proceeds
as applicable) None None None None
Redemption Fee (as a percentage of amount
redeemed,
if applicable) None None None None
Exchange Fee None None None None
ANNUAL INVESTMENT SHARES OPERATING EXPENSES
(As a percentage of average net assets)
Management Fee (after fee waivers)(1) 0.62% 0.65% 0.63% 0.01%
Shareholder Servicing Fee None None None None
12b-1 Fees(2) 0.25% 0.25% 0.25% 0.00%
Total Other Expenses (after fee
waivers and/or expense reimbursements)(3) 0.54% 0.46% 0.35% 0.50%
Total Investment Shares Operating Expenses (after
fee
waivers and/or expense reimbursements)(4) 1.41% 1.36% 1.23% 0.51%
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS
INTERMEDIATE
MUNICIPAL
INCOME
FUND*
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) 2.00%
Maximum Sales Load Imposed on Reinvested
Dividends
(as a percentage of offering price) None
Contingent Deferred Sales Charge (as a percentage
of
original purchase price or redemption proceeds
as applicable) None
Redemption Fee (as a percentage of amount
redeemed,
if applicable) None
Exchange Fee None
ANNUAL INVESTMENT SHARES OPERATING EXPENSES
(As a percentage of average net assets)
Management Fee (after fee waivers)(1) 0.02%
Shareholder Servicing Fee None
12b-1 Fees(2) 0.00%
Total Other Expenses (after fee
waivers and/or expense reimbursements)(3) 0.50%
Total Investment Shares Operating Expenses (after
fee
waivers and/or expense reimbursements)(4) 0.52%
</TABLE>
(1) The maximum management fee is 0.70% for Connecticut Intermediate Municipal
Income Fund and Massachusetts Intermediate Municipal Income Fund; and 0.80%
for Investment Shares of the Fixed Income Fund, Intermediate Government
Income Fund, and Limited Term Income Fund.
(2) The 12b-1 fee for Investment Shares have been reduced to reflect the
voluntary waiver of fees by that Fund's distributor. As of the date of this
prospectus, neither the Connecticut Intermediate Municipal Income Fund nor
the Massachusetts Intermediate Municipal Income Fund intend to accrue or pay
12b-1 fees until either a separate class of shares has been created for
certain fiduciary investors for these portfolios or a determination is made
that such investors will be subject to the 12b-1 fees. The Income Funds can
pay up to 0.50% as a 12b-1 fee to the distributor.
(3) Other expenses have been reduced to reflect the voluntary waiver of fees by
that Fund's custodian; and reimbursement by the adviser for the Connecticut
Intermediate Municipal Income Fund and the Massachusetts Municipal Income
Fund.
(4) Absent the voluntary waivers and reimbursements explained in the above
footnotes, which can be terminated at any time, the Operating Expenses of
Investment Shares are 3.30% for the Connecticut Intermediate Municipal
Income Fund; 3.10% for the Massachusetts Intermediate Municipal Income Fund;
1.67% for the Fixed Income Fund; 1.79% for the Intermediate Government
Income Fund; and 1.87% for the Limited Term Income Fund.
*Connecticut Intermediate Municipal Income Fund and Massachusetts Intermediate
Municipal Income Fund currently sell their shares without class designation.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of Investment Shares will bear, either
directly or indirectly. For more complete descriptions of the various costs and
expenses, see "Administration" and "Investing in Shares." Wire-transferred
redemptions of less than $5,000 may be subject to additional fees.
EXAMPLE
You would pay the following expenses on a $1,000 investment assuming (1) 5%
annual return and (2) redemption at the end of the following periods:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Limited Term Income Fund........................................................ $34 $64 $96 $186
Intermediate Government Income Fund............................................. $34 $62 $93 $180
Fixed Income Fund............................................................... $32 $58 $86 $166
Connecticut Intermediate Municipal Income Fund.................................. $25 $36 $48 $ 83
Massachusetts Intermediate Municipal Income Fund................................ $25 $36 $48 $ 84
</TABLE>
THE ABOVE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The information set forth in the foregoing table and example relates only to
Investment Shares of the Income Funds. Fixed Income Fund, Intermediate
Government Income Fund, and Limited Term Income Fund also offer another class of
shares called Trust Shares. Trust Shares and Investment Shares are subject to
certain of the same expenses; however, Investment Shares are subject to a 12b-1
fee of up to .50 of 1% of average net assets. See "Other Classes of Shares."
5. Please delete the section entitled "Expense Summary" in the Shawmut
Equity Funds--Trust Shares Prospectus and replace it with the
following:
THE SHAWMUT EQUITY FUNDS
Expense Summary Trust Shares
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
PORTFOLIOS
- ------------------------------------------------------------------------------------------------------------------------------------
GROWTH AND SMALL
INCOME GROWTH CAPITALIZATION
EQUITY EQUITY EQUITY
FUND FUND FUND
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) None None None
Maximum Sales Load Imposed on Reinvested Dividends
(as a percentage of offering price) None None None
Contingent Deferred Sales Charge (as a percentage of original
purchase price or redemption proceeds, as applicable) None None None
Redemption Fee (as a percentage of amount redeemed, if applicable) None None None
Exchange Fee None None None
ANNUAL TRUST SHARES OPERATING EXPENSES
(As a percentage of average net assets)
Management Fee (after fee waivers)(1) 0.82% 0.53% 0.76%
Shareholder Servicing Fee None None None
12b-1 Fees None None None
Total Other Expenses (after fee waivers and/or expense
reimbursements)(2) 0.26% 0.70% 0.34%
Total Trust Shares Operating Expenses (after fee waivers
and/or expense reimbursements)(3) 1.08% 1.23% 1.10%
</TABLE>
(1) The maximum management fee for Trust Shares is 1.00%.
(2) Other expenses for Trust Shares have been reduced to reflect the voluntary
waiver of fees by that Fund's custodians; and reimbursement of expenses by
the investment adviser for the Growth Equity Fund.
(3) Absent the voluntary waivers and reimbursements explained in the above
footnotes, which can be terminated at any time, the Operating Expenses for
Trust Shares are 1.27% for the Growth and Income Equity Fund; 2.19% for the
Growth Equity Fund; and 1.36% for the Small Capitalization Equity Fund.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of Trust Shares will bear, either directly
or indirectly. For more complete descriptions of the various costs and expenses,
see "Administration" and "Investing in Shares." Wire-transferred redemptions of
less than $5,000 may be subject to additional fees.
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 the following periods:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Growth and Income Equity Fund............................................ $11 $34 $60 $132
Growth Equity Fund....................................................... $13 $39 $68 $149
Small Capitalization Equity Fund......................................... $11 $35 $61 $134
</TABLE>
THE ABOVE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The information set forth in the foregoing table and example relates only to
Trust Shares of the Equity Funds. The Equity Funds also offer another class of
shares called Investment Shares. Trust Shares and Investment Shares are subject
to certain of the same expenses; however, Investment Shares are subject to a
12b-1 fee of up to .50 of 1% of average net assets. See "Other Classes of
Shares."
6. Please delete the section entitled "Expense Summary of the Shawmut
Equity Funds--Investment Shares Prospectus and replace it with the
following:
THE SHAWMUT EQUITY FUNDS
Expense Summary Investment Shares
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
PORTFOLIOS
- ------------------------------------------------------------------------------------------------------------------------------------
GROWTH AND SMALL
INCOME GROWTH CAPITALIZATION
EQUITY EQUITY EQUITY
FUND FUND FUND
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) 4.00% 4.00% 4.00%
Maximum Sales Load Imposed on Reinvested Dividends
(as a percentage of offering price) None None None
Contingent Deferred Sales Charge (as a percentage of original
purchase price or redemption proceeds, as applicable) None None None
Redemption Fee (as a percentage of amount redeemed, if applicable) None None None
Exchange Fee None None None
ANNUAL INVESTMENT SHARES OPERATING EXPENSES
(As a percentage of average net assets)
Management Fee (after fee waivers)(1) 0.82% 0.53% 0.76%
Shareholder Servicing Fee None None None
12b-1 Fees(2) 0.25% 0.25% 0.25%
Total Other Expenses (after fee waivers and/or expense reimbursements)(3) 0.26% 0.70% 0.34%
Total Investment Shares Operating Expenses (after fee waivers
and/or expense reimbursements)(4) 1.33% 1.48% 1.35%
</TABLE>
(1) The maximum management fee for Investment Shares is 1.00%.
(2) The 12b-1 fees for the Investment Shares have been reduced to reflect the
voluntary waiver of fees by that Fund's distributor. The Equity Funds can
pay up to 0.50% of the average daily net assets of Investment Shares as a
12b-1 fee to the distributor.
(3) Other expenses for Investment Shares have been reduced to reflect the
voluntary waiver of fees by that Fund's custodian; and reimbursement of
expenses by the investment adviser for the Growth Equity Fund.
(4) Absent the voluntary waivers and reimbursements explained in the above
footnotes, which can be terminated at any time, the Operating Expenses for
Investment Shares are 1.77% for the Growth and Income Equity Fund; 2.69% for
the Growth Equity Fund; 1.86% for the Small Capitalization Equity Fund.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of Investment Shares will bear, either
directly or indirectly. For more complete descriptions of the various costs and
expenses, see "Administration" and "Investing in Shares." Wire-transferred
redemptions of less than $5,000 may be subject to additional fees.
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 the following periods:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Growth and Income Equity Fund................................................... $53 $80 $110 $194
Growth Equity Fund.............................................................. $54 $85 $118 $210
Small Capitalization Equity Fund................................................ $53 $81 $111 $196
</TABLE>
THE ABOVE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The information set forth in the foregoing table and example relates only to
Investment Shares of the Equity Funds. The Equity Funds also offer another class
of shares called Trust Shares. Trust Shares and Investment Shares are subject to
certain of the same expenses; however, Investment Shares are subject to a 12b-1
fee of up to .50 of 1% of average net assets. See "Other Classes of Shares."
7. Please delete the section entitled "Expense Summary" in the Shawmut
Money Market Funds--Trust Shares Prospectus and replace it with the
following:
THE SHAWMUT MONEY MARKET FUNDS
Expense Summary Trust Shares
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
PORTFOLIOS
- ------------------------------------------------------------------------------------------------------------------------------------
PRIME CONNECTICUT MASSACHUSETTS
MONEY MUNICIPAL MUNICIPAL
MARKET MONEY MARKET MONEY MARKET
FUND FUND FUND*
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) None None None
Maximum Sales Load Imposed on Reinvested Dividends
(as a percentage of offering price) None None None
Contingent Deferred Sales Charge (as a percentage of original
purchase price
or redemption proceeds as applicable) None None None
Redemption Fee (as a percentage of amount redeemed, if applicable) None None None
Exchange Fee None None None
ANNUAL TRUST SHARES OPERATING EXPENSES
(As a percentage of average net assets)
Management Fee (after fee waivers)(1) 0.29% 0.34% 0.18%
Shareholder Servicing Fee None None None
12b-1 Fees(2) None None 0.00%
Total Other Expenses (after fee waivers
and/or expense reimbursements)(3) 0.17% 0.23% 0.39%
Total Trust Shares Operating Expenses (after fee waivers
and/or expense reimbursements)(4) 0.46% 0.57% 0.57%
</TABLE>
(1) The maximum management fee for Trust Shares is .50%.
(2) The Massachusetts Municipal Money Market Fund does not intend to accrue or
pay 12b-1 fees until either a separate class of shares has been created for
certain fiduciary investors or a determination is made that such investors
will be subject to 12b-1 fees. Massachusetts Municipal Money Market Fund can
pay up to 0.50% of its average daily net assets as a 12b-1 fee to its
distributor.
(3) Other expenses for Trust Shares have been reduced to reflect the voluntary
waiver of fees by that Fund's custodian; the voluntary reimbursement by the
adviser for the Massachusetts Municipal Money Market Fund and the
Connecticut Municipal Money Market Fund.
(4) Absent the voluntary waivers and reimbursements explained in the above
footnotes, which can be terminated at any time, the Operating Expenses for
Trust Shares are 0.68% for the Prime Money Market Fund; 0.78% for the
Connecticut Municipal Money Market Fund; and 1.06% for the Massachusetts
Municipal Money Market Fund.
* Massachusetts Municipal Money Market Fund currently sells its shares without
class designation.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of Trust Shares will bear, either directly
or indirectly. For more complete descriptions of the various costs and expenses,
see "Administration" and "Investing in Shares." Wire-transferred redemptions of
less than $5,000 may be subject to additional fees.
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 the following periods:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Prime Money Market Fund.................................................. $5 $15 $26 $58
Connecticut Municipal Money Market Fund.................................. $6 $18 $32 $71
Massachusetts Municipal Money Market Fund................................ $6 $18 $32 $71
</TABLE>
THE ABOVE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The information set forth in the foregoing table and example relates only to
Trust Shares of the Money Market Funds. Connecticut Municipal Money Market Fund
and Prime Money Market Fund also offer another class of shares called Investment
Shares. Trust Shares and Investment Shares are subject to certain of the same
expenses; however, Investment Shares are subject to a 12b-1 fee of up to 0.50 of
1% of average net assets. See "Other Classes of Shares."
8. Please delete the section entitled "Expense Summary" in the Shawmut
Money Market Funds--Investment Shares Prospectus and replace it with
the following:
THE SHAWMUT MONEY MARKET FUNDS
Expense Summary Investment Shares
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
PORTFOLIOS
CONNECTICUT MASSACHUSETTS
PRIME MUNICIPAL MUNICIPAL
MONEY MONEY MONEY
MARKET FUND MARKET FUND MARKET FUND*
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) None None None
Maximum Sales Load Imposed on Reinvested Dividends
(as a percentage of offering price) None None None
Contingent Deferred Sales Charge (as a percentage of original
purchase price or redemption proceeds, as applicable) None None None
Redemption Fee (as a percentage of amount redeemed, if applicable) None None None
Exchange Fee None None None
ANNUAL INVESTMENT SHARES OPERATING EXPENSES
(As a percentage of average net assets)
Management Fee (after fee waivers)(1) 0.29% 0.34% 0.18%
Shareholder Servicing Fee None None None
12b-1 Fees(2) 0.25% 0.25% 0.00%
Total Other Expenses (after fee waivers and/or expense
reimbursements)(3) 0.17% 0.23% 0.39%
Total Investment Shares Operating Expenses (after fee waivers
and/or expense reimbursements)(4) 0.71% 0.82% 0.57%
</TABLE>
(1) The maximum management fee for Investment Shares is 0.50%.
(2) The 12b-1 fee has been reduced to reflect the voluntary waiver by that
Fund's distributor. Both the Prime Money Market Fund and Connecticut
Municipal Money Market Fund can pay up to 0.50% of the average daily net
assets of Investment Shares as a 12b-1 fee to the distributor. The
Massachusetts Municipal Money Market Fund does not intend to accrue or pay
12b-1 fees until either a separate class of shares has been created for
certain fiduciary investors or a determination is made that such investors
will be subject to the 12b-1 fees. The Massachusetts Municipal Money Market
Fund can pay up to 0.50% of the average daily net assets as a 12b-1 fee to
the distributor.
(3) Other expenses for Investment Shares have been reduced to reflect the
voluntary waiver of fees by that Fund's custodian; the voluntary
reimbursement by the adviser for the Massachusetts Municipal Money Market
Fund and the Connecticut Municipal Money Market Fund.
(4) Absent the voluntary waivers and reimbursements explained in the above
footnotes, which can be terminated at any time, the Operating Expenses of
Investment Shares are 1.18% for the Prime Money Market Fund; 1.28% for the
Connecticut Municipal Money Market Fund; and 1.06% for the Massachusetts
Municipal Money Market Fund.
*Massachusetts Municipal Money Market Fund currently sells its shares without
class designation.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of Investment Shares will bear, either
directly or indirectly. For more complete descriptions of the various costs and
expenses, see "Administration" and "Investing in Shares." Wire-transferred
redemptions of less than $5,000 may be subject to additional fees.
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 the following periods:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Prime Money Market Fund.................................................. $7 $23 $40 $88
Connecticut Municipal Money Market Fund.................................. $8 $26 $46 $101
Massachusetts Municipal Money Market Fund................................ $6 $18 $32 $71
</TABLE>
THE ABOVE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The information set forth in the foregoing table and example relates only to
Investment Shares of the Money Market Funds. Prime Money Market Fund and
Connecticut Municipal Money Market Fund also offer another class of shares
called Trust Shares. Trust Shares and Investment Shares are subject to certain
of the same expenses; however, Investment Shares are subject to a 12b-1 fee of
up to .50 of 1% of average net assets. See "Other Classes of Shares."
November 21,
1995
FEDERATED SECURITIES CORP.
---------------------------------------------
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
Cusip 820482859 Cusip 820482842
Cusip 820482701 Cusip 820482750
Cusip 820482693 Cusip 820482776
Cusip 820482107 Cusip 820482404
Cusip 820482818 Cusip 820482826
Cusip 820482800 Cusip 820482875
Cusip 820482833 Cusip 820482206
Cusip 820482834 Cusip 820482768
Cusip 820482792 Cusip 820482503
Cusip 820482784 Cusip 820482305
Cusip 820482867
