497(e)
MONEY
MARKET FUNDS
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
1784 Funds
- --------------------------------------------------------------------------------
1784 U.S. TREASURY
MONEY MARKET FUND
--------------------------------
1784 PRIME
MONEY MARKET FUND
--------------------------------
1784 TAX-FREE
MONEY MARKET FUND
--------------------------------
1784 INSTITUTIONAL U.S.
TREASURY MONEY MARKET FUND
--------------------------------
FUND INFORMATION AND PROSPECTUS
OCTOBER 1, 1996
NOT PART OF THE PROSPECTUS
<PAGE>
1784 MONEY MARKET FUNDS
- --------------------------------------------------------------------------------
LOW RISK, FLEXIBILITY AND CURRENT INCOME--WITH A TAX-FREE OPTION.
For many savers and investors, money market funds are a good complement to
savings accounts, CDs, and other low-risk investments. Consider the advantages
of the 1784 Money Market Funds and you'll understand why.
[BULLET] STABILITY--
These Funds are managed with the goal of returning a dollar to you for every
dollar you invest, plus dividends.
[BULLET] ATTRACTIVE, COMPETITIVE YIELDS--
These Funds seek to provide variable rates of return that exceed insured savings
accounts and the money market deposit accounts available through banks.
[BULLET] ACCESS TO YOUR MONEY --
You have access to your money whenever you need it because the Funds will buy
back your shares whenever you want.
[BULLET] CONVENIENCE--
The 1784 Money Market Funds are an excellent place to hold cash you plan to
invest longer-term or that you may need soon.
INTRODUCING THE
1784 MONEY MARKET FUNDS TEAM:
JAMES L. BOSLAND, CFA
1784 TAX-FREE MONEY MARKET FUND
EMMETT M. WRIGHT, CFA
1784 U.S. TREASURY MONEY MARKET FUND
1784 INSTITUTIONAL U.S. TREASURY MONEY MARKET FUND
MARY K. WERLER, CFA
1784 PRIME MONEY MARKET FUND
LISA LEBOEUF
1784 U.S. TREASURY MONEY MARKET FUND
1784 PRIME MONEY MARKET FUND
1784 INSTITUTIONAL U.S. TREASURY MONEY MARKET FUND
[PHOTO OMITTED]
MONEY MANAGEMENT STRENGTH.
The 1784 Funds are managed
by Bank of Boston.
Founded in 1784, Bank of Boston
has a 100-year track record
of investment management experience.
The 1784 Funds are managed by
the same investment professionals
who oversee more than $20 billion
for clients of Bank of Boston's
family of banks and who have earned national
recognition and respect.
IMPORTANT INFORMATION ABOUT THE 1784 FUNDS
-------------------------------
The 1784 Funds are not FDIC insured, are not deposits or
other obligations of, or guaranteed by, any bank, and
involve investment risks, including possible loss of the
principal amount invested.
The First National Bank of Boston (FNBB) serves as investment adviser and
custodian for the 1784 Funds. BayBank Services, Inc., an affiliate of FNBB,
serves as Shareholder Servicing Agent for 1784 Funds. The 1784 Funds are
distributed by SEI
Financial Services Company (SFS). SFS is not affiliated with FNBB or any of
its affiliates. Financial Services Counselors are registered
representatives of 1784 Investor Services, Inc., a wholly-owned
subsidiary of FNBB.
Money market funds seek to maintain a stable net asset value of $1.00 per
share, but there is no assurance that they will be able to do so on a
continuing basis. Money market funds are not insured or guaranteed by the
U.S. Government.
NOT PART OF THE PROSPECTUS
<PAGE>
WHICH 1784 MONEY
MARKET FUND
IS RIGHT FOR YOU?
[PHOTO OMITTED]
"I want safety as much
as I need return."
CONSIDER THE
1784 U.S. TREASURY
MONEY MARKET FUND.
[PHOTO OMITTED]
"I want a higher return, and I'm willing to take a little more risk
to get it."
[PHOTO OMITTED]
"I want a competitive return without increasing my taxes."
CONSIDER THE
1784 TAX-FREE
MONEY MARKET FUND.
1784 MONEY MARKET FUNDS*
- --------------------------------------------------------------------------------
THE 1784 U.S. TREASURY MONEY MARKET FUND--
FOR EXCEPTIONALLY LOW RISK.
[BULLET] Stability AND safety are very important to you.
[BULLET] You want the opportunity to earn a higher yield than insured bank
savings accounts and bank money market deposit accounts.
This Fund is a portfolio of some of the world's safest investments-- U.S.
Treasury and related securities. U.S. Treasury Securities are often viewed as a
no-risk investment in that the U.S. Government is unlikely to fail to meet its
obligations. And, as this graph shows, the yields paid by this Fund have
historically been higher than many types of stable, insured investments such as
bank savings and money market accounts.
COMPARISON OF 1784 U.S. TREASURY
MONEY MARKET FUND TO BANK RATES
[GRAPHIC OMITTED]
A line graph depicting the comparison of 1784 U.S. Treasury Money Market
Fund versus Bank Rates.
<TABLE>
<CAPTION>
Money Market 1784 U.S.Treasury
Deposit Account Statement Money Market
(MMDA)+ Savings+ Fund
<S> <C> <C> <C>
Dec-93 2.22 2.36 2.57
2.22 2.40 2.64
2.22 2.39 2.65
2.22 2.37 2.86
2.22 2.33 3.07
2.22 2.45 3.51
Jun-94 2.22 2.40 3.67
2.22 2.42 3.81
2.22 2.46 4.17
2.22 2.50 4.30
2.26 2.62 4.55
2.26 2.67 5.30
Dec-94 2.26 2.79 5.52
2.36 2.83 4.98
2.36 2.87 5.50
2.36 2.89 5.64
2.32 2.89 5.63
2.32 2.87 5.66
Jun-95 2.32 2.86 5.64
2.32 2.86 5.40
2.32 2.86 5.37
2.32 2.86 5.40
2.33 2.86 5.32
2.33 2.84 5.41
Dec-95 2.33 2.82 5.23
2.33 2.77 5.07
2.33 2.73 4.78
2.33 2.71 4.91
2.22 2.68 4.78
2.22 2.65 4.54
Sep-96 2.22 2.67 4.87
2.22 2.67 4.90
2.22 2.64 4.83
2.67 2.22 4.87
</TABLE>
[] 1784 U.S. TREASURY MONEY MARKET FUND
[] MONEY MARKET DEPOSIT ACCOUNT (MMDA) +
[] STATEMENT SAVINGS +
Past performance is no guarantee of future results. Statement savings and money
market deposit accounts are FDIC insured. The 1784 U.S. Treasury Money Market
Fund is not FDIC insured.
+ Source: Bank Rate Monitor. MMDA rates are a national average of the top 25
markets. Rates are as of the last week of each month. Statement Savings are
average rates paid by the institutions in the Bank Rate Monitor National
Index.
NOT PART OF THE PROSPECTUS
<PAGE>
THE 1784 PRIME MONEY MARKET FUND-- FOR HIGHER YIELD POTENTIAL.
[BULLET] Higher yield potential is important to you.
[BULLET] You don't mind taking a little more risk than a fund that invests
primarily in U.S. Government securities.
Because this Fund invests in short-term bank and corporate obligations, it may
earn a higher yield than a money market fund that invests solely in lower-risk
U.S. Government securities. This graph shows how historical yields of funds of
this type have compared with the yields of funds that invest in U.S. Treasury
obligations.
COMPARISON OF DONOGHUE'S ALL-TAXABLE
TO U.S. TREASURY FUNDS
[GRAPHIC OMITTED]
A line graph depicting the comparison of Donoghue's All-Taxable versus U.S.
Treasury Funds.
<TABLE>
<CAPTION>
Donoghue's Donoghue's
U.S. Treasury All Taxable
<S> <C> <C>
Dec-93 2.65 2.76
2.63 2.71
2.66 2.83
2.72 2.98
2.97 3.18
3.27 3.57
Jun-94 3.51 3.71
3.57 3.87
3.82 4.11
4.04 4.29
4.23 4.44
4.60 4.96
Dec-94 4.84 5.32
5.03 5.37
5.28 5.64
5.42 5.68
5.36 5.68
5.37 5.66
Jun-95 5.26 5.62
5.19 5.46
5.02 5.27
5.06 5.35
5.00 5.36
5.04 5.40
Dec-95 4.91 5.28
4.83 5.13
4.66 4.89
4.61 4.90
4.61 4.86
4.61 4.85
Sep-96 4.63 4.92
4.68 4.94
4.74 4.98
</TABLE>
[] DONOGHUE'S ALL TAXABLE
[] DONOGHUE'S U.S. TREASURY
Past performance is no guarantee of future results.
THE 1784 TAX-FREE MONEY MARKET FUND--
FOR TAX-FREE CURRENT INCOME.**
[BULLET] Minimizing any additional tax burden from your investments is
important to you.
[BULLET] Your Federal tax bracket is higher than 28%.
If your federal tax-bracket is 28% or more, this Fund's after-tax performance
may compare favorably
with funds that pay higher taxable yields. The Fund invests primarily in
municipal securities, so income may be exempt from federal taxes. The higher
your tax bracket, the greater a benefit this may be to you.
COMPARISON OF TAX EQUIVALENT YIELDS
FOR VARIOUS TAX BRACKETS
TO DONOGHUE'S ALL-TAXABLE
[GRAPHIC OMITTED]
A line graph depicting the comparison of Tax Equivalent Yields for various tax
brackets to Donoghue's All-Taxable versus 1784 Tax-Free Money Market Fund
Tax Equivalent Yield:
<TABLE>
<CAPTION>
All Taxable++ at 28.0% at 31.0% at 36.0% at 39.6%
<S> <C> <C> <C> <C> <C>
Dec-93 2.76 3.04 3.17 3.42 3.63
2.71 2.58 2.70 2.91 3.08
2.83 2.76 2.88 3.11 3.29
2.98 2.47 2.58 2.78 2.95
3.18 3.06 3.19 3.44 3.64
3.57 3.29 3.43 3.70 3.92
Jun-94 3.71 3.18 3.32 3.58 3.79
3.87 3.22 3.36 3.63 3.84
4.11 3.44 3.59 3.88 4.11
4.29 3.96 4.13 4.45 4.72
4.44 3.72 3.88 4.19 4.44
4.96 4.38 4.57 4.92 5.22
Dec-94 5.32 5.79 6.04 6.52 6.90
5.37 4.43 4.62 4.98 5.28
5.64 4.92 5.13 5.53 5.86
5.68 4.88 5.09 5.48 5.81
5.68 5.43 5.67 6.11 6.47
5.66 5.10 5.32 5.73 6.08
Jun-95 5.62 4.96 5.17 5.58 5.91
5.46 4.64 4.84 5.22 5.53
5.27 4.50 4.70 5.06 5.36
5.35 4.82 5.03 5.42 5.75
5.36 4.69 4.90 5.28 5.60
5.40 4.65 4.86 5.23 5.55
Dec-95 5.28 5.60 5.84 6.30 6.67
5.13 4.07 4.25 4.58 4.85
4.89 4.04 4.22 4.55 4.82
4.90 4.04 4.22 4.55 4.82
4.86 4.56 4.75 5.13 5.43
4.85 4.40 4.59 4.95 5.25
4.92 4.08 4.26 4.59 4.87
4.94 4.21 4.39 4.73 5.02
Sep-96 4.98 4.63 4.83 5.20 5.51
</TABLE>
[] DONOGHUE'S ALL TAXABLE ++
THE 1784 TAX-FREE MONEY MARKET FUND TAX EQUIV. YIELD:
[] AT 28.0% [] AT 31.0% [] AT 36.0% [] AT 39.6%
++ SOURCE: IDC/DONOGHUE, INC.
Past performance is no guarantee of future results.
* Money market funds seek to maintain a stable net asset value of $1.00 per
share, but there is no assurance that they will be able to do so on a
continuing basis. Money market funds are not insured or guaranteed by the
U.S. Government.
** A portion of the income of this Fund may be subject to alternative minimum
tax and/or local taxes.
NOT PART OF THE PROSPECTUS
<PAGE>
1784 MONEY MARKET FUNDS
- ----------------------------
INVEST IN YOUR CHOICE TODAY.
This investment kit contains everything you need to invest in a 1784 Money
Market Fund, including a New Account Application and prospectus.
TO INVEST IN A
1784 MONEY MARKET FUND:
[CHECK MARK] SELECT THE FUND THAT IS RIGHT FOR YOU.
[CHECK MARK] COMPLETE THE ENCLOSED NEW ACCOUNT APPLICATION.
[CHECK MARK] MAKE OUT A CHECK (PAYABLE TO THE 1784 FUND YOU HAVE CHOSEN) FOR THE
AMOUNT YOU ARE INVESTING.
[CHECK MARK] GIVE THE APPLICATION AND YOUR CHECK TO A SERVICE REPRESENTATIVE IN
YOUR BRANCH,OR MAIL IN THE ENVELOPE PROVIDED.
You should receive a confirmation of your investment by mail within five
business days.
If you have any questions on the 1784 Money Market Funds, please call
1-800-252-1784. Please keep in mind that your branch staff cannot advise you on
how to invest--but they can help you to set up an appointment with a Financial
Services Counselor, who can provide objective, informed answers.
[LOGO]
1784 Funds
EXPERT PLANNING
AND
OBJECTIVE GUIDANCE.
When you have questions
or want advice, you can talk to
a Financial Services Counselor (FSC)
who will provide objective,
straight-forward help
based on your goals.
And because the 1784 Funds
are no-load, this guidance
is available to you without
commissions or sales charges.
[LOGO]
1784 Funds
SOUND CHOICES. STRAIGHT TALK.
INVESTMENT MANAGEMENT STRENGTH.
1-800-252-1784
NOT PART OF THE PROSPECTUS
<PAGE>
Please read this Prospectus before investing, and keep it on file for future
reference. It contains important information, including how the Funds invest and
services available to shareholders.
To learn more about the Funds and their investments, you can obtain a copy of
the Funds' most recent financial report and portfolio listing or a copy of the
Statement of Additional Information dated October 1, 1996. The Statement of
Additional Information has been filed with the Securities and Exchange
Commission and is incorporated into this Prospectus by reference. For a free
copy of either document call 1-800-252-1784.
- --------------------------------------------------------------------------------
REMEMBER THAT SHARES OF THE FUNDS
(BULLET) ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, BANK
OF BOSTON OR ANY OF ITS AFFILIATES
(BULLET) ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY
(BULLET) INVOLVE INVESTMENT RISKS, INCLUDING RISK TO PRINCIPAL
- --------------------------------------------------------------------------------
LIKE ALL MUTUAL FUNDS, 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.
Investments in the Funds are neither insured nor guaranteed by the U.S.
Government. There can be no assurance that the Funds will be able to maintain a
stable net asset value of $1.00 per share.
1784 FUNDS
1784 FUNDS(R)
================================================================================
PROSPECTUS
0CTOBER 1, 1996
This Prospectus describes the following no-load mutual funds advised by Bank of
Boston:
(BULLET) 1784 U.S. Treasury Money Market Fund
(BULLET) 1784 Prime Money Market Fund
(BULLET) 1784 Tax-Free Money Market Fund
(BULLET) 1784 Institutional U.S. Treasury Money Market Fund
1784 FUNDS
[LOGO OMITTED]
<PAGE>
PROSPECTUS 1784 FUNDS
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
FUND SUMMARY ....................................... 1
EXPENSES ........................................... 2
FINANCIAL HIGHLIGHTS ............................... 3
INVESTMENT INFORMATION ............................. 3
Investment objectives and principal
investment policies ............................ 3
Additional investment policies ................. 4
Risk considerations ............................ 5
DIVIDENDS AND DISTRIBUTIONS ........................ 6
MANAGEMENT ......................................... 6
SHAREHOLDER SERVICES ............................... 8
How to reach the Funds ......................... 8
Types of accounts .............................. 8
How to open an account ......................... 8
How to purchase shares ......................... 8
How to sell shares ............................. 10
Shareholder services and policies .............. 11
TAXES .............................................. 12
GENERAL INFORMATION ................................ 13
Net asset value ................................ 13
Organization ................................... 13
Voting and other rights ........................ 13
Performance information ........................ 13
Expenses ....................................... 14
APPENDIX A --
Taxable Equivalent Yield Table .................... 15
APPENDIX B --
Permitted Investments and
Investment Practices .............................. 15
- --------------------------------------------------------------------------------
FUND SUMMARY
================================================================================
This section summarizes the Funds' investment objectives and who may want to
invest. See the rest of this Prospectus for more information, including risk
considerations. As with any mutual fund, there can be no assurance that a Fund
will achieve its investment objective. No Fund, by itself, is intended to be
a complete investment program.
1784 U.S. TREASURY MONEY MARKET FUND, 1784 PRIME MONEY MARKET FUND AND 1784
INSTITUTIONAL U.S. TREASURY MONEY MARKET FUND OBJECTIVE: to preserve
principal value and maintain a high degree of liquidity while providing
current income.
1784 TAX-FREE MONEY MARKET FUND OBJECTIVE: to preserve principal value and
maintain a high degree of liquidity while providing current income exempt
from federal income tax.
WHO MAY WANT TO INVEST
These Funds are designed for conservative investors who want liquidity,
current income at money market rates and stability of principal. Because
they emphasize stability, these Funds may be an appropriate component of a
savings plan. The Treasury Funds offer an added measure of safety with
their focus on U.S. government securities.
1
<PAGE>
PROSPECTUS 1784 FUNDS
EXPENSES
================================================================================
These tables show shareholder transaction expenses and estimated annual
operating expenses for the Funds, and are intended to assist investors in
understanding the various costs and expenses that shareholders in the Funds will
bear, either directly or indirectly. For more information, see "Management" on
page 8 and "General Information - Expenses" on page 16.
SHAREHOLDER TRANSACTION EXPENSES
- --------------------------------------------------------------------------------
Maximum sales load imposed on
purchases and reinvested dividends None
Deferred sales charges imposed on redemptions None
Redemption fee* None
Exchange fee None
- --------------------------------------------------------------------------------
*There is a $12 service fee if the Funds wire redemption proceeds to your bank
account.
ANNUAL OPERATING EXPENSES (1)
- --------------------------------------------------------------------------------
(EXPRESSED AS A PERCENTAGE OF AVERAGE NET ASSETS)
Total
Advisory Other Operating
Fee(2) Expenses(2) Expenses(2)
- --------------------------------------------------------------------------------
U.S. Treasury Money
Market Fund .40% .24% .64%
Prime Money
Market Fund(3) .40 .25 .65
Tax-Free Money
Market Fund .36 .20 .56
Institutional U.S. Treasury
Money Market Fund .20 .20 .40
- --------------------------------------------------------------------------------
EXAMPLE(1)
A shareholder would pay the following expenses on a $1,000 investment, assuming
a 5% annual return, reinvestment of all dividends and redemption of the shares
after the number of years indicated:
- --------------------------------------------------------------------------------
1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
U.S. Treasury Money
Market Fund $7 $21 $36 $81
Prime Money Market Fund(3) 7 21 36 81
Tax-Free Money Market Fund 6 18 31 70
Institutional U.S. Treasury
Money Market Fund 4 13 22 51
- --------------------------------------------------------------------------------
(1) Unless otherwise noted, the information in the expense table and the
example is based on the fiscal year ended May 31, 1996 and reflects
voluntary fee waivers and/or reimbursements. The assumption in the example
of a 5% annual return is required by the Securities and Exchange Commission
for all mutual funds, and is not a prediction of any Fund's future
performance. The example should not be considered a representation of past
or future expenses of any Fund. Actual expenses may be greater or less than
those shown.
(2) Without fee waivers and reimbursements, advisory fees would be 0.40% for
each Fund (.20% for the Institutional U.S. Treasury Money Market Fund); and
other expenses and total operating expenses would be .35% and .75% for the
U.S. Treasury Money Market Fund, .25% and .65% for the Prime Money Market
Fund, .20% and .60% for the Tax-Free Money Market Fund and .20% and .40%
for the Institutional U.S. Treasury Money Market Fund.
(3) Because the Fund is newly organized, amounts are estimated for the current
fiscal year.
2
<PAGE>
PROSPECTUS 1784 FUNDS
FINANCIAL HIGHLIGHTS
================================================================================
This table contains financial information about the Funds and is included in the
Funds' Annual Report. The table has been audited by Coopers & Lybrand L.L.P.,
independent accountants. Their reports on the financial statements and financial
highlights are included in the Annual Report. The financial statements and
financial highlights are incorporated by reference into the Statement of
Additional Information. Copies of the Annual Report may be obtained without
charge by calling 1-800-252-1784. The Prime Money Market Fund is newly organized
and has not issued financial statements.
<TABLE>
<CAPTION>
NET
ASSET DISTRIBUTIONS
VALUE NET FROM NET
BEGINNING INVESTMENT INVESTMENT
OF PERIOD INCOME INCOME
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
1784 U.S. TREASURY MONEY MARKET FUND
For the year ended May 31, 1996 $1.00 0.05 (0.05)
For the year ended May 31, 1995 $1.00 0.05 (0.05)
For the period ended May 31, 1994(1) $1.00 0.03 (0.03)
- ---------------------------------------------------------------------------
1784 TAX-FREE MONEY MARKET FUND
For the year ended May 31, 1996 $1.00 0.03 (0.03)
For the year ended May 31, 1995 $1.00 0.03 (0.03)
For the period ended May 31, 1994(2) $1.00 0.02 (0.02)
- ---------------------------------------------------------------------------
1784 INSTITUTIONAL U.S. TREASURY MONEY MARKET FUND
For the year ended May 31, 1996 $1.00 0.05 (0.05)
For the year ended May 31, 1995 $1.00 0.05 (0.05)
For the period ended May 31, 1994(3) $1.00 0.03 (0.03)
- ---------------------------------------------------------------------------
NET
ASSETS RATIO
END OF EXPENSES
TOTAL OF PERIOD TO AVERAGE
RETURN (000) NET ASSETS
- --------------------------------------------------------------------------
<S> <C> <C> <C>
1784 U.S. TREASURY MONEY MARKET FUND
For the year ended May 31, 1996 5.16% $ 78,999 0.64%
For the year ended May 31, 1995 4.81% $ 55,068 0.60%
For the period ended May 31, 1994(1) 2.64%* $ 5,593 0.65%
- --------------------------------------------------------------------------
1784 TAX-FREE MONEY MARKET FUND
For the year ended May 31, 1996 3.55% $549,628 0.54%
For the year ended May 31, 1995 3.29% $539,412 0.50%
For the period ended May 31, 1994(2) 2.31%* $407,448 0.27%
- --------------------------------------------------------------------------
1784 INSTITUTIONAL U.S. TREASURY MONEY MARKET FUND
For the year ended May 31, 1996 5.45% $644,733 0.32%
For the year ended May 31, 1995 5.05% $395,585 0.30%
For the period ended May 31, 1994(3) 2.99%* $181,568 0.22%
- --------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
RATIO RATIO OF
RATIO OF EXPENSES NET INCOME
OF NET TO AVERAGE TO AVERAGE
INCOME NET ASSETS NET ASSETS
TO AVERAGE (EXCLUDING (EXCLUDING
NET ASSETS WAIVERS) WAIVERS)
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
1784 U.S. TREASURY MONEY MARKET FUND
For the year ended May 31, 1996 5.02% 0.75% 4.91%
For the year ended May 31, 1995 5.13% 0.92% 4.81%
For the period ended May 31, 1994(1) 2.91% 6.42% (2.86)%
- -------------------------------------------------------------------------------
1784 TAX-FREE MONEY MARKET FUND
For the year ended May 31, 1996 3.49% 0.60% 3.43%
For the year ended May 31, 1995 3.28% 0.61% 3.17%
For the period ended May 31, 1994(2) 2.39% 0.71% 1.95%
- -------------------------------------------------------------------------------
1784 INSTITUTIONAL U.S. TREASURY MONEY MARKET FUND
For the year ended May 31, 1996 5.29% 0.39% 5.22%
For the year ended May 31, 1995 5.12% 0.41% 5.01%
For the period ended May 31, 1994(3) 3.16% 0.55% 2.83%
- -------------------------------------------------------------------------------
<FN>
* Returns are for the period indicated and have not been annualized.
(1) The U.S. Treasury Money Market Fund commenced operations on June 7, 1993.
All ratios for the period have been annualized.
(2) The Tax-Free Money Market Fund commenced operations on June 14, 1993. All
ratios for the period have been annualized.
(3) The Institutional U.S. Treasury Money Market Fund commenced operations on
June 14, 1993. All ratios for the period have been annualized.
</FN>
</TABLE>
INVESTMENT INFORMATION
================================================================================
INVESTMENT OBJECTIVES AND PRINCIPAL INVESTMENT POLICIES
- --------------------------------------------------------------------------------
This section describes each Fund's investment objective and principal investment
policies. Additional investment policies and risk considerations are described
in the next sections. Each Fund's investment objective is fundamental, meaning
that it cannot be changed without the approval of shareholders of that Fund. Of
course, there can be no assurance that any Fund will achieve its investment
objective.
The investment objective of the 1784 U.S. TREASURY MONEY MARKET FUND, 1784 PRIME
MONEY MARKET FUND and 1784 INSTITUTIONAL U.S. TREASURY MONEY MARKET FUND is to
preserve principal value and maintain a high degree of liquidity while providing
current income.
The investment objective of the 1784 TAX-FREE MONEY MARKET FUND is to preserve
principal value and maintain a high degree of liquidity while providing current
income exempt from federal income taxes.
3
<PAGE>
PROSPECTUS 1784 FUNDS
================================================================================
The U.S. TREASURY MONEY MARKET FUND and INSTITUTIONAL U.S. TREASURY MONEY MARKET
FUND invest primarily in U.S. Treasury obligations, including bills, notes and
bonds, and repurchase agreements secured by U.S. Treasury obligations. Under
normal circumstances at least 65% of these Funds' assets is invested in these
securities. U.S. Treasury obligations are supported by the "full faith and
credit" of the United States. Under normal circumstances these Funds invest the
rest of their assets in obligations of U.S. government agencies or
instrumentalities and repurchase agreements secured by these obligations.
Subject to applicable law, the Institutional Treasury Fund also invests in other
mutual funds that hold only U.S. government obligations and repurchase
agreements secured by these obligations. Some obligations of U.S. government
agencies and instrumentalities are supported by the "full faith and credit" of
the United States, others by the right of the issuer to borrow from the U.S.
Treasury and others only by the credit of the agency or instrumentality.
Although the Funds invest in U.S. government obligations, an investment in the
Funds is not insured or guaranteed by the U.S. government.
The PRIME MONEY MARKET FUND invests primarily in high quality money market
instruments. These instruments include short-term U.S. government obligations,
corporate bonds, bank obligations (including certificates of deposit, bankers'
acceptances and fixed time obligations), commercial paper and other short-term
debt obligations and repurchase agreements.
The TAX-FREE MONEY MARKET FUND invests primarily in Municipal Securities.
Municipal Securities are debt securities issued by the states, territories and
possessions of the United States (including the District of Columbia) and their
political subdivisions, agencies and instrumentalities that pay interest that is
exempt from federal income tax, including the alternative minimum tax. Municipal
Securities also may be issued by other qualifying issuers and include bonds,
notes and commercial paper. Under normal circumstances at least 80% of the
Fund's net assets is invested in Municipal Securities. The Fund may also invest
in taxable money market instruments, such as short-term U.S. government
obligations, bank obligations (including certificates of deposit, bankers'
acceptances and fixed time obligations), commercial paper and other short-term
debt obligations and repurchase agreements. Under normal circumstances not more
than 20% of the Fund's assets is invested in taxable instruments. See Appendix A
for information on taxable equivalent yields.
Each Fund employs specific investment policies and procedures designed to
maintain a constant net asset value of $1.00 per share. There can be no
assurance, however, that a constant net asset value will be maintained on a
continuing basis.
The Funds comply with industry regulations applicable to money market funds.
These regulations require that each Fund's investments mature or be deemed to
mature within 397 days from the date of acquisition, that the average maturity
of each Fund's investments (on a dollar-weighted basis) be 90 days or less, and
that all of the Funds' investments be in U.S. dollar-denominated high quality
securities which have been determined by the Adviser to present minimal credit
risks. Investments in high quality, short-term instruments may, in many
circumstances, result in a lower yield than would be available from investments
in instruments with a lower quality or a longer term.
ADDITIONAL INVESTMENT POLICIES
- --------------------------------------------------------------------------------
This section describes additional investment policies of the Funds. See "Risk
Considerations" for more information.
NON-U.S. SECURITIES.
Each Fund may invest a portion of its assets in non-U.S. securities. Investing
in non-U.S. securities involves risks in addition to those of investing in U.S.
securities. See "Risk Considerations."
(CONTINUED)
4
<PAGE>
PROSPECTUS 1784 FUNDS
INVESTMENT INFORMATION (CONTINUED)
================================================================================
TEMPORARY INVESTMENTS.
During periods of unusual economic or market conditions or for temporary
defensive purposes or liquidity, each Fund may invest without limit in cash and
in U.S. dollar-denominated high quality money market and short-term instruments.
These investments may result in a lower yield than would be available from
investments with a lower quality or longer term.
OTHER PERMITTED INVESTMENTS.
For more information regarding the Funds' permitted investments and investment
practices, see Appendix B. The Funds will not necessarily invest or engage in
each of the investments and investment practices in Appendix B but reserve the
right to do so. OTHER INVESTMENT COMPANIES. The Prime Money Market Fund may
invest substantially all of its assets in a mutual fund having the same
investment objective and policies as that particular Fund. INVESTMENT
RESTRICTIONS. The Statement of Additional Information contains a list of
specific investment restrictions which govern the investment policies of the
Funds, including a limitation that each Fund may borrow money from banks in an
amount not to exceed 331/3% of the Fund's total assets for extraordinary or
emergency purposes (e.g., to meet redemption requests). Shareholder approval is
required to change each Fund's investment objective. Generally, the Funds'
investment policies may be changed without shareholder approval. If a percentage
or rating restriction (other than a restriction as to borrowing) is adhered to
at the time an investment is made, a later change in percentage or rating
resulting from changes in a Fund's securities will not be a violation of policy.
PORTFOLIO TURNOVER. Securities of a Fund will be sold whenever the Adviser or
Advisers believe it is appropriate to do so in light of the Fund's investment
objective, without regard to the length of time a particular security may have
been held. The amount of brokerage commissions and realization of taxable
capital gains will tend to increase as the level of portfolio activity
increases.
BROKERAGE TRANSACTIONS.
The primary consideration in placing each Fund's
securities transactions with broker-dealers for execution is to obtain and
maintain the availability of execution at the most favorable prices and in the
most effective manner possible. The Funds may execute brokerage or other agency
transactions through an investment adviser or distributor of the Funds. The
adviser or distributor will be paid for these transactions.
RISK CONSIDERATIONS
- --------------------------------------------------------------------------------
The risks of investing in each Fund vary depending upon the nature of the
securities held, and the investment practices employed, on its behalf.
Certain of these risks are described in this section.
NON-U.S. SECURITIES. Investments in non-U.S. securities involve risks relating
to political, social and economic developments abroad, as well as risks
resulting from the differences between the regulations to which U.S. and
non-U.S. issuers and markets are subject. These risks may include expropriation,
confiscatory taxation, withholding taxes on dividends and interest, limitations
on the use or transfer of portfolio assets and political or social instability.
Enforcing legal rights may be difficult, costly and slow in non-U.S. countries,
and there may be special problems enforcing claims against non-U.S. governments.
In addition, non-U.S. companies may not be subject to accounting standards or
governmental supervision comparable to U.S. companies, and there may be less
public information about their operations. Non-U.S. markets may be less liquid
and more volatile than U.S. markets, and may offer less protection to investors
such as the Funds.
INVESTMENT PRACTICES. Certain of the investment practices employed for the Funds
may entail certain risks. These risks are in addition to the risks described
above and are described in Appendix B.
5
<PAGE>
PROSPECTUS 1784 FUNDS
DIVIDENDS AND DISTRIBUTIONS
================================================================================
Substantially all of each Fund's net income from dividends and interest is
declared as a dividend daily to shareholders of record. Shares begin accruing
dividends on the date of purchase, and accrue dividends up to and including the
day prior to redemption. Dividends are paid monthly on the first business day of
each month.
Each Fund's net realized short-term and long-term
capital gains, if any, will be distributed to the Fund's shareholders at least
annually, in December. Each Fund may also make additional distributions to its
shareholders to the extent necessary to avoid the application of the 4%
non-deductible excise tax on certain undistributed income and net capital gains
of mutual funds.
Distributions are paid in additional shares issued at net asset value unless the
shareholder elects to receive payment in cash.
MANAGEMENT
================================================================================
TRUSTEES AND OFFICERS.
Each Fund is supervised by the Board of Trustees of 1784 Funds. More information
on the Trustees and Fund officers may be found under "Management" in the
Statement of Additional Information.
INVESTMENT ADVISER.
Bank of Boston is the investment adviser of each Fund, and subject to policies
set by the Trustees, makes investment decisions. Bank of Boston is the successor
to a bank chartered in 1784 and offers a wide range of banking and investment
services to customers throughout the world. Bank of Boston has been providing
asset management services since 1890. The Private Bank Division of Bank of
Boston is the investment management group within Bank of Boston that advises the
Funds. As of December 31, 1995, The Private Bank was responsible for the
investment management of approximately $16 billion of individual, institutional,
endowment and corporate assets, including $2.5 billion in assets of the Funds,
in money market, equity, and fixed income securities. The Private Bank has
earned national recognition and respect as an investment manager. Bank of Boston
is a wholly-owned subsidiary of Bank of Boston Corporation; its legal name is
The First National Bank of Boston and its address is 100 Federal Street, Boston,
Massachusetts 02110.
The following chart shows the investment advisory fees paid by each Fund for the
fiscal year ended May 31, 1996. The Prime Money Market Fund is newly organized
and had no operations during that fiscal year.
- --------------------------------------------------------------------------------
Advisory fees paid
(expressed as a percentage
of average net assets)
- --------------------------------------------------------------------------------
U.S. Treasury Money Market Fund .40%
Tax-Free Money Market Fund .34
Institutional U.S. Treasury Money Market Fund .13
BANKING RELATIONSHIPS. Bank of Boston and its affiliates may have banking
relationships with the issuers of securities purchased for the Funds. These
relationships may include outstanding loans to issuers which may be repaid in
whole or in part with the proceeds of securities purchased for the Funds. Bank
of Boston has informed the Funds that in making its investment decisions, it
does not obtain or use material inside information in the possession of any
division or department of Bank of Boston or any of its affiliates.
BANK REGULATORY MATTERS. The Glass-Steagall Act prohibits certain financial
institutions, such as Bank of Boston, from underwriting securities of open-end
investment companies, such as the Funds. Bank of Boston believes that its
investment advisory services are not underwriting and are consistent with the
Glass-Steagall
(CONTINUED)
6
<PAGE>
PROSPECTUS 1784 FUNDS
MANAGEMENT (CONTINUED)
================================================================================
Act and other relevant federal and state laws. State laws on this issue may
differ from applicable federal law, and banks and financial institutions may be
required to register as dealers pursuant to state securities laws. Changes in
either federal or state statutes or regulations, or in their interpretations,
could prevent Bank of Boston from continuing to perform these services. If that
were to happen, the Funds would seek alternative means for obtaining these
services.
ADMINISTRATOR. SEI Fund Resources provides administrative and fund accounting
services to the Funds, including regulatory reporting, office facilities and
equipment and personnel. For these services SEI receives a fee, which is
calculated daily and paid monthly, at an annual rate of 0.15% of the first $300
million of the combined average daily net assets of the Funds and the other
funds in the 1784 family of funds, 0.12% of the second $300 million and 0.10% of
combined average daily net assets in excess of $600 million. SEI has agreed to
waive portions of its fee from time to time. These fees will be reduced when the
Funds' reorganization with the BayFunds takes effect. See "General Information -
Organization" on page 13. SEImay retain sub-administrators, including Bank of
Boston, whose fees would be paid by SEI.
SHAREHOLDER SERVICING AGENT AND TRANSFER AGENT. Boston Financial Data Services,
2 Heritage Drive, North Quincy, Massachusetts 02171, is the Funds' dividend
disbursing agent and shareholder servicing agent. State Street Bank and Trust
Company, 225 Franklin Street, Boston, Massachusetts 02110, is the transfer
agent. Bank of Boston also acts as a shareholder servicing agent for the U.S.
Treasury Money Market Fund and the Prime Money Market Fund. For these services,
Bank of Boston receives a fee, calculated daily and paid monthly, at an annual
rate of 0.10% of these Funds' average daily net assets.
DISTRIBUTION ARRANGEMENTS. SEI Financial Services Company, 680 East Swedesford
Road, Wayne, Pennsylvania 19087, is the distributor of shares of each Fund. The
Distributor receives no fee for these services.
From time to time the Distributor may provide incentive compensation to its own
employees and employees of banks (including Bank of Boston), broker-dealers and
investment counselors in connection with the sale of shares of the Funds.
Promotional incentives may be cash or other compensation, including merchandise,
airline vouchers, trips and vacation packages, will be offered uniformly to all
program participants and will be predicated upon the amount of shares of the
Funds sold by the participant.
CUSTODIAN. Bank of Boston is the Funds' custodian. Fund securities may be held
by a sub-custodian bank approved by the Trustees.
7
<PAGE>
PROSPECTUS 1784 FUNDS
SHAREHOLDER SERVICES
================================================================================
This section describes how to do business with the Funds and shareholder
services that are available.
HOW TO REACH THE FUNDS
BY TELEPHONE 1-800-252-1784
Call for account or Fund
information Monday through
Friday 8 a.m. to 8 p.m. and
Saturday and Sunday between
9 a.m. and 4 p.m. (Eastern time).
BY REGULAR MAIL 1784 Funds
P.O. Box 8524
Boston, MA 02266-8524
BY OVERNIGHT COURIER 1784 Funds
c/o Boston Financial Data Services
2 Heritage Drive
North Quincy, MA 02171
TYPE OF ACCOUNTS
If you are investing in the Funds for the first time, you will need to establish
an account. You may establish the following types of accounts by completing the
account application included with this Prospectus. If there is no application
accompanying this Prospectus, call 1-800-252-1784.
(BULLET) INDIVIDUAL OR JOINT OWNERSHIP. Individual accounts are owned by one
person. Joint accounts have two or more owners.
(BULLET) GIFT OR TRANSFER TO MINOR (UGMA OR UTMA). A UGMA (Uniform Gifts to
Minors Act) or UTMA (Uniform Transfers to Minors Act) account is a
custodial account managed for the benefit of a minor. To open a UGMA or
UTMA account, you must include the minor's social security number on
the application.
(BULLET) TRUST. A trust can open an account. The name of each trustee, the name
of the trust and the date of the trust agreement must be included on
the application.
(BULLET) CORPORATIONS, PARTNERSHIPS AND OTHER LEGAL ENTITIES. Corporations,
partnerships and other legal entities may also open an account. The
application must be signed by a general partner of the partnership or
an authorized officer of the corporation or other legal entity.
(BULLET) RETIREMENT. If you are eligible, you may set up your account under a
tax-sheltered retirement plan, such as an Individual Retirement
Account. Bank of Boston offers a number of retirement plans through
which Fund shares may be purchased. Call 1-800-252-1784 for more
information.
HOW TO OPEN AN ACCOUNT
Complete and sign the appropriate account application. Please be sure to provide
your social security or taxpayer identification number on the application.
Make your check payable to the Fund in which you are investing. Send all items
to one of the following addresses:
BY REGULAR MAIL 1784 Funds
P.O. Box 8524
Boston, MA 02266-8524
BY OVERNIGHT COURIER 1784 Funds
c/o Boston Financial
Data Services
2 Heritage Drive
North Quincy, MA 02171
You may also purchase shares through certain financial institutions, including
Bank of Boston. These institutions may have their own procedures for purchases
and redemptions, and may charge fees. Contact your financial institution for
more information.
HOW TO PURCHASE SHARES
Shares of the Funds are sold on a continuous basis
and may be purchased from the Distributor or a broker-dealer or financial
institution that has an agreement with the Distributor. Purchases may be made
Monday through Friday, except on certain holidays.
(CONTINUED)
8
<PAGE>
PROSPECTUS 1784 FUNDS
SHAREHOLDER SERVICES (CONTINUED)
================================================================================
Each Fund's share price, called net asset value, is calculated every business
day. Each Fund's shares are sold without a sales charge. Shares are purchased at
net asset value the next time it is calculated after your investment is received
and accepted by the Distributor. Net asset value is normally calculated at 12
noon Eastern time (3 p.m. for the Institutional U.S. Treasury Money Market
FUND). For the Institutional U.S. Treasury Money Market Fund, the Distributor
must receive federal funds by the close of business on the day your order is
received and accepted. For the other Funds your investment is considered
received when your check is converted into federal funds. This normally happens
within two business days.
On days when the financial markets close early, such as the day after
Thanksgiving and Christmas Eve, purchase orders for the Institutional U.S.
Treasury Money Market Fund must be received by 12 noon.
Shares of the Prime Money Market Fund will be available commencing December 9,
1996.
NEW PURCHASES. If you are new to the Funds, complete and sign an account
application and mail it along with your check. To establish the telephone
purchase option on your new account, complete the "Telephone Purchase of Shares"
section on the application and attach a "voided" check or deposit slip from your
bank account.
If you are investing through a tax-sheltered retirement plan for the first time,
you will need a special application. Retirement investing also involves its own
investment procedures. Call 1-800-252-1784 for more information.
ADDITIONAL PURCHASES. If you already have money invested in a Fund, you can
invest additional money in that Fund in the following ways:
BY MAIL. Complete the remittance slip attached at the bottom of your
confirmation statement. If you are making a purchase into a retirement
account, please indicate whether the purchase is a rollover or a current or
prior year contribution. Send your check and remittance slip or written
instructions to one of the addresses listed previously.
BY TELEPHONE. This service allows you to purchase additional shares quickly
and conveniently through an electronic transfer of money. When you make an
additional purchase by telephone, the Funds will automatically debit your
predesignated bank account for the desired amount. If you have not
established the telephone purchase option, call 1-800-252-1784 to request
the appropriate form.
BY WIRE. Purchases may also be made by wiring money from your bank account
to your Fund account. Call 1-800-252-1784 to receive wiring instructions.
AUTOMATIC INVESTMENT PROGRAMS. Automatic investing is an easy way to add to
your account systematically. The Funds offer automatic investment plans to
help you achieve your financial goals as simply and conveniently as
possible. Minimum purchase amounts apply. Call 1-800-252-1784 for
information.
PAYING FOR SHARES. Please note the following:
(BULLET) Purchases may be made by check, wire transfer and automated clearing
house transactions.
(BULLET) All purchases must be made in U.S. dollars.
(BULLET) Checks must be drawn on U.S. banks and must be payable to the Funds.
(BULLET) Cash and credit card checks are not accepted.
(BULLET) If a check does not clear your bank, the Funds reserve the right to
cancel the purchase. (BULLET) If the Funds are unable to debit your
predesignated bank account on the day of purchase, they may make
additional attempts or cancel the purchase.
If your purchase is canceled, you will be responsible for any losses or fees
imposed by your bank and losses that may be incurred as a result of any decline
in the value of the canceled purchase. The Funds have the authority to redeem
shares in your account(s) to cover any losses due to fluctuations in share
price. The Funds reserve the right to reject any specific purchase request.
9
<PAGE>
PROSPECTUS 1784 FUNDS
================================================================================
MINIMUM INVESTMENTS. The following minimums apply, unless they are waived by thE
Distributor.
To open an account $1,000.00*
For tax-sheltered retirement plans 250.00
To add to an account 250.00**
Through automatic investment plans 50.00
Minimum account balance 1,000.00*
For tax-sheltered retirement plans 250.00
* $100,000 for the Institutional U.S. Treasury Money Market Fund
** $5,000 for the Institutional U.S. Treasury Money Market Fund
HOW TO SELL SHARES
On any business day, you may redeem all or a portion of your shares. If the
shares being redeemed were purchased by check, telephone or through an automatic
investment program, the Funds may delay the mailing of your redemption check for
up to 15 days after purchase to allow the purchase to clear.
Your transaction will be processed at net asset value the next time it is
calculated after your redemption request in good order is received. A redemption
is treated as a sale for tax purposes, and could result in taxable gain or loss
in a non-tax-sheltered account.
BY MAIL. To redeem all or part of your shares by mail, your request should be
sent in writing to one of the addresses listed on page 10 and must include the
following information:
(BULLET) the name of the Fund(s),
(BULLET) the account number(s),
(BULLET) the amount of money or number of shares being redeemed,
(BULLET) the name(s) on the account,
(BULLET) the signature(s) of all registered account owners, and
(BULLET) your daytime telephone number.
Signature requirements vary based on the type of account you have:
(BULLET) INDIVIDUAL, JOINT TENANTS, TENANTS IN COMMON: Written instructions must
be signed by each shareholder, exactly as the names appear in the
account registration.
(BULLET) UGMA OR UTMA: Written instructions must be signed by the custodian in
his/her capacity as it appears in the account registration.
(BULLET) SOLE PROPRIETOR, GENERAL PARTNER: Written instructions must be signed
by an authorized individual in his/her capacity as it appears in the
account registration.
(BULLET) CORPORATION, ASSOCIATION: Written instructions must be signed by the
person(s) authorized to act on the account. In addition, a certified
copy of the corporate resolution, authorizing the signer to act, must
accompany the request.
(BULLET) TRUST: Written instructions must be signed by the trustee(s). If the
name of the current trustee(s) does not appear in the account
registration, a certificate of incumbency dated within 60 days must
also be submitted.
(BULLET) RETIREMENT: Written instructions must be signed by the account owner.
Call 1-800-252-1784 for more information.
BY TELEPHONE. If you selected this option on your account application, you may
make redemptions from your account by calling 1-800-252-1784 by 4:00 p.m.
Eastern Time. The Funds at their option may require requests for redemptions in
excess of $25,000 to be in writing with signatures guaranteed. You may not close
your account by telephone.
SYSTEMATIC WITHDRAWAL PLAN. Under this plan you may redeem a specific dollar
amount from your account on a regular basis. For more information or to sign up
for this service, please call 1-800-252-1784.
(CONTINUED)
10
<PAGE>
PROSPECTUS 1784 FUNDS
SHAREHOLDER SERVICES (CONTINUED)
================================================================================
PAYMENT OF REDEMPTION PROCEEDS. Payments may be made by check or wire transfer.
BY CHECK Redemption proceeds will be sent to the shareholder(s) of record at the
address of record within seven days after receipt of a valid
redemption request.
BY WIRE If you are authorized for the wire redemption service, your redemption
proceeds will be wired directly into your designated bank account
normally on the business day of receipt of your redemption request.
There is no limitation on redemptions by wire; however, there is a $12
fee for each wire and your bank may charge an additional fee to receive
the wire. If you would like to establish this option on an existing
account, please call 1-800-252-1784 to sign up for this service. Wire
redemptions are not available for retirement accounts.
SIGNATURE GUARANTEES. In addition to the signature requirements, a signature
guarantee is required in any of the following circumstances:
(BULLET) You would like the check made payable to anyone other than the
shareholder(s) of record.
(BULLET) You would like the check mailed to an address other than the address
of record.
At the Funds' discretion signature guarantees may also be required for other
redemptions. A signature guarantee assures that a signature is genuine and
protects shareholders from unauthorized account transfers. Banks, savings and
loan associations, trust companies, credit unions, broker-dealers and member
firms of a national securities exchange may guarantee signatures. Call your
financial institution to see if it has this capability.
SHAREHOLDER SERVICES AND POLICIES
EXCHANGES. On any business day you may exchange all or a portion of your shares
into any other available Fund or any other fund in the 1784 Funds family. To
make exchanges, please follow the procedures for redemptions. Exchanges are
processed at the net asset value next calculated after an exchange request in
good order is received and approved. Please read the prospectus for the Fund
into which you are exchanging. The Funds reserve the right to reject any
exchange request or to modify or terminate the exchange privilege at any time.
An exchange is the sale of shares of one Fund and purchase of shares of another,
and could result in taxable gain or loss in a non-tax-sheltered account.
REDEMPTION PROCEEDS. The Funds intend to pay redemption proceeds in cash, but
reserve the right to pay in kind by delivery of investment securities equal to
the redemption price. In these cases, you might incur brokerage costs in
converting the securities to cash. The right of any shareholder to receive
payment of redemption proceeds may be suspended, or payment may be postponed, in
certain circumstances. These circumstances include any period the New York Stock
Exchange is closed (other than weekends or holidays) or trading on the Exchange
is restricted, any period when an emergency exists and any time the Securities
and Exchange Commission permits mutual funds to postpone payments for the
protection of investors.
TAXPAYER IDENTIFICATION NUMBER. On the account application or other appropriate
form, you will be asked to certify that your social security or taxpayer
identification number is correct and that you are not subject to backup
withholding for failing to report income to the IRS. If you are subject to
backup withholding or you did not certify your taxpayer identification number,
the IRS requires the Funds to withhold 31% of any dividends and redemption or
exchange proceeds. SHARE CERTIFICATES. Share certificates are not issued.
INVOLUNTARY REDEMPTIONS. If your account balance falls below the minimum
required investment as a result of a redemption or exchange, you will be given
60 days to re-establish the minimum balance. If you do not, your account may be
closed and the proceeds sent to you.
TELEPHONE TRANSACTIONS. You may initiate many transactions by telephone. The
Funds and their agents will not be responsible for any losses resulting from
acting upon
11
<PAGE>
PROSPECTUS 1784 FUNDS
================================================================================
wire or telephone instructions that it reasonably believes to be genuine. The
Funds and their agents will each employ reasonable procedures to confirm that
instructions communicated by telephone are genuine. Such procedures may include
taping of telephone conversations. It may be difficult to reach the Funds by
telephone during periods of unusual market activity. If you are unable to reach
a representative by telephone, please consider sending written instructions.
ADDRESS CHANGES. To change the address on your account, call 1-800-252-1784 and
send a written request signed by all account owners. Include the name of your
Fund(s), the account numbers(s), the name(s) on the account and both the old and
new addresses.
REGISTRATION CHANGES. To change the name on an account, the shares are generally
transferred to a new account. In some cases, legal documentation may be
required. For more information, call 1-800-252-1784. If your shares are held of
record by a financial institution, contact that financial institution for
ownership changes.
STATEMENTS AND REPORTS. The Funds will send you a confirmation statement after
every transaction that affects your account balance or your account
registration. If you are enrolled in an automatic investment program and invest
on a monthly basis, you will receive quarterly confirmations. Information
regarding the tax status of income dividends and capital gains distributions
will be mailed to shareholders early each year.
Financial reports for the Funds, which include a list
of the Funds' portfolio holdings, will be mailed semiannually to all
shareholders.
CHECKWRITING. Checkwriting privileges are available to certain shareholders for
certain Funds. Call 1-800-252-1784 for more information. You may not use a check
to close your account.
TAXES
================================================================================
This discussion of taxes is for general information only. Investors should
consult their own tax advisers about their particular situations.
Each Fund intends to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies so that it will not be liable for
any federal income or excise taxes. A Fund may pay withholding or other taxes to
foreign governments during the year, however, and these taxes will reduce that
Fund's dividends.
With certain exceptions, Fund dividends and capital gains distributions are
subject to federal income tax and may also be subject to state and local taxes.
Distributions from interest on U.S. government obligations may be exempt from
state and local taxes. The Tax-Free Money Market Fund expects that its
distributions from interest on Municipal Securities will usually be exempt from
federal income tax. Dividends and distributions are treated in the same manner
for federal tax purposes whether they are paid in cash or as additional shares.
Generally, distributions from a Fund's net investment income and short-term
capital gains will be taxed as ordinary income. A portion of certain Funds'
distributions from net investment income may be eligible for the dividends
received deduction available to corporations. Distributions of long-term net
capital gains will be taxed as such regardless of how long the shares of a Fund
have been held.
Interest on loans to purchase or carry shares of the Tax-Free Money Market Fund
will not be deductible for federal income tax purposes. Exempt-interest
dividends may be subject to alternative minimum tax.
Foreign shareholders may be subject to withholding taxes.
Early each year, each Fund will notify its shareholders of the amount and tax
status of distributions paid to shareholders for the preceding year. Investors
should consult their own tax advisers regarding the status of their accounts
under state and local laws.
12
<PAGE>
PROSPECTUS 1784 FUNDS
GENERAL INFORMATION
================================================================================
NET ASSET VALUE.
Net asset value per share for each Fund other than the Institutional U.S.
Treasury Money Market Fund is calculated each business day at 12 noon Eastern
time. Net asset value per share for the Institutional U.S. Treasury Money Market
Fund is calculated each business day at 3 p.m. Eastern time.
All purchases, redemptions and exchanges will be processed at net
asset value the next time it is calculated after a request is received and
approved by the Distributor. In order to receive that day's price, an order must
be received by 12 noon. Eastern time (3 p.m. for the Institutional U.S. Treasury
Money Market Fund unless the financial markets close early). Net asset value per
share is calculated by dividing the total value of a Fund's securities and other
assets, less liabilities, by the total number of shares outstanding. Securities
held by the Funds are valued at amortized cost, which approximates market value.
ORGANIZATION.
Each Fund is a series of 1784 Funds. 1784 Funds is a Massachusetts business
trust which was organized on February 5, 1993; it also is an open-end management
investment company registered under the Investment Company Act of 1940. 1784
Funds currently has fourteen active series (fifteen when shares of the Prime
Money Market Fund are available).
Each Fund is a diversified mutual fund. Under the 1940 Act, a diversified mutual
fund must manage at least 75% of its total assets so that no more than 5% of
those assets are invested in any one company at the time of investment.
Under Massachusetts law, shareholders of a business trust may, under certain
circumstances, be held personally liable as partners for the trust's
obligations. However, the risk of a shareholder incurring financial loss on
account of shareholder liability is limited to circumstances in which both
inadequate insurance existed and the trust itself was unable to meet its
obligations.
The Funds intend to enter into a reorganization with the BayFunds, which is
expected to close in November, 1996. In the reorganization, the Funds will
receive securities from the BayFunds and will issue their shares in exchange.
VOTING AND OTHER RIGHTS.
1784 Funds may issue an unlimited number of shares, may create new series of
shares and may divide shares in each series into classes. Each share of each
Fund gives the shareholder one vote in Trustee elections and other matters
submitted to shareholders for vote. All shares of each series of 1784 Funds have
equal voting rights except that, in matters affecting only a particular Fund or
class, only shares of that particular Fund or class are entitled to vote.
The U.S. Treasury Money Market Fund currently offers three classes of shares.
Class A shares are described in this Prospectus. Class C and Class D shares are
available solely in conjunction with certain cash management products offered by
Bank of Boston. Class C and Class D shares may have different expenses, which
may affect performance. Call 1-800-252-1784 for more information.
Because 1784 Funds is a Massachusetts business trust, the Funds are not required
to hold annual shareholder meetings. Shareholder approval will usually be sought
only for changes in certain investment restrictions and for the election of
Trustees under certain circumstances. Trustees may be removed by shareholders
under certain circumstances. Each share of each Fund is entitled to participate
equally in dividends and other distributions and the proceeds of any liquidation
of that Fund, subject to any differing expenses borne by different classes of
the Fund.
PERFORMANCE INFORMATION.
Fund performance may be quoted in advertising, shareholder reports and other
communications in terms of yield, effective yield and total rate of return. All
performance information is historical and is not intended to indicate future
performance. Yields and total rates of return fluctuate in response to market
conditions and other factors, and the value of a Fund's shares when redeemed may
be more or less than their original cost.
Each Fund may provide annualized "yield" and "effective yield" quotations. The
"yield" of a Fund refers to the income generated by an investment in the Fund
over a 7-day or 30-day or one-month period (which period is stated in any such
advertisement or communication). This income is then annualized; that is, the
amount of income generated by the investment over that period is assumed to be
generated
13
<PAGE>
PROSPECTUS 1784 FUNDS
================================================================================
each week or month over a one-year period and is shown as a percentage of the
maximum public offering price on the last day of that period. The "effective
yield" is calculated similarly, but when annualized the income earned by the
investment during that 7-day, 30-day or one-month period is assumed to be
reinvested. The effective yield is slightly higher than the yield because of the
compounding effect of this assumed reinvestment. A "yield" quotation, unlike a
total rate of return quotation, does not reflect changes in net asset value.
Each Fund may provide period and average annualized "total rates of return." The
"total rate of return" refers to the change in the value of an investment in the
Fund over a stated period and reflects any change in net asset value per share
and is compounded to include the value of any shares purchased with any
dividends or capital gains declared during such period. Period total rates of
return may be "annualized." An "annualized" total rate of return assumes that
the period total rate of return is generated over a one-year period. The
Tax-Free Money Market Fund may also advertise a "tax-equivalent yield." The
"tax-equivalent yield" is calculated by determining the yield that would have to
be achieved on a fully taxable investment to produce the after-tax equivalent of
the Fund's yield, assuming certain tax brackets for a shareholder. A Fund's
performance may from time to time be compared to that of other mutual funds
tracked by mutual fund rating services, to that of broad groups of comparable
mutual funds or to that of unmanaged indices which may assume investment of
dividends but generally do not reflect deductions for administrative and
management costs. Certain Funds may advertise performance that includes results
from periods in which the Funds' assets were managed in a non-registered
predecessor vehicle. Of course, any fees charged by a financial institution to a
shareholder will reduce that shareholder's net return on investment. See the
Statement of Additional Information for more information concerning the
calculation of performance for the Funds.
EXPENSES.
In addition to amounts payable to its service providers, each Fund is
responsible for its own expenses, including, among other things, the costs of
securities transactions, the compensation of Trustees that are not affiliated
with Bank of Boston or the Administrator, government fees, taxes, accounting and
legal fees, expenses of communicating with shareholders, interest expense and
insurance premiums. The following table shows each Fund's expenses for the
fiscal year ended May 31, 1996, expressed as a percentage of average net assets.
The Prime Money Market Fund is newly organized and had no operations during that
fiscal year.
Expenses
- --------------------------------------------------------------------------------
U.S. Treasury Money Market Fund .64%
Tax-Free Money Market Fund .54
Institutional U.S. Treasury Money Market Fund .32
COUNSEL AND INDEPENDENT AUDITORS.
Bingham, Dana & Gould LLP, Boston, Massachusetts, is counsel for each Fund.
Coopers & Lybrand L.L.P., Boston, Massachusetts, serves as independent auditor
for each Fund.
-------------------------------
The Statement of Additional Information dated the date of this Prospectus
contains more detailed information about the Funds, including information
relating to (i) investment policies and restrictions, (ii) the Trustees,
officers and investment advisers, (iii) securities transactions, (iv) the Funds'
shares, including rights and liabilities of shareholders, (v) the method used to
calculate performance information and (vi) the determination of net asset value.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR THE STATEMENT OF ADDITIONAL
INFORMATION IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPECTUS AND, IF
GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE FUNDS OR THEIR DISTRIBUTOR. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFERING BY THE FUNDS OR THEIR DISTRIBUTOR IN ANY JURISDICTION
IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.
14
<PAGE>
PROSPECTUS 1784 FUNDS
APPENDIX A -- TAXABLE EQUIVALENT YIELDS
================================================================================
This table shows the yield investors need to achieve from a taxable investment
to equal the yield from a tax-exempt investment. These tables do not predict the
yield of any Fund. They are accurate as of September 12, 1996.
- --------------------------------------------------------------------------------
FEDERAL
Equivalent yields: Tax-exempt versus taxable securities
<TABLE>
<CAPTION>
1996
Taxable Income Federal
- ------------------------------- Marginal
Single Joint Rate 4.0% 4.5% 5.0% 5.5%
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$0-24,000 $0-40,100 15.00% 4.71% 5.29% 5.88% 6.47%
24,001-58,150 40,101-96,900 28.00% 5.56% 6.25% 6.94% 7.64%
58,151-121,300 96,901-147,700 31.00% 5.80% 6.52% 7.25% 7.97%
121,301-263,750 147,701-263,750 36.00% 6.25% 7.03% 7.81% 8.59%
over 263,750 over 263,750 39.60% 6.62% 7.45% 8.28% 9.11%
1996
Taxable Income
- -------------------------------
Single Joint 6.0% 6.5% 7.0% 7.5% 8.0%
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$0-24,000 $0-40,100 7.06% 7.65% 8.24% 8.82% 9.41%
24,001-58,150 40,101-96,900 8.33% 9.03% 9.72% 10.42% 11.11%
58,151-121,300 96,901-147,700 8.70% 9.42% 10.14% 10.87% 11.59%
121,301-263,750 147,701-263,750 9.38% 10.16% 10.94% 11.72% 12.50%
over 263,750 over 263,750 9.93% 10.76% 11.59% 12.42% 13.25%
</TABLE>
APPENDIX B -- PERMITTED INVESTMENTS AND INVESTMENT PRACTICES
================================================================================
U.S. TREASURY OBLIGATIONS
U.S. Treasury obligations include bills, notes and bonds issued by the U.S.
Treasury and separately traded interest and principal component parts of such
obligations that are transferable through the Federal book-entry system known as
Separately Traded Registered Interest and Principal Securities (STRIPS). STRIPS
are sold as zero coupon securities. These securities are usually structured with
two classes that receive different portions of the interest and principal
payments from the underlying obligation. The yield to maturity on the
interest-only class is extremely sensitive to the rate of principal payments on
the underlying obligation. The market value of the principal-only class
generally is unusually volatile in response to changes in interest rates. See
"Zero Coupon Securities" for more information. Each Fund limits its investments
in STRIPS to 20% of its total assets.
U.S. GOVERNMENT AGENCIES
Certain Federal agencies such as the Government National Mortgage Association
(GNMA) have been established as instrumentalities of the U.S. government to
supervise and finance certain types of activities. Issues of these agencies,
while not direct obligations of the U.S. government, are either backed by the
full faith and credit of the United States (e.g., GNMA) or supported by the
issuing agencies' right to borrow from the Treasury. The issues of other
agencies are supported only by the credit of the instrumentality (e.g., Federal
National Mortgage Association).
RECEIPTS
Receipts are interests in separately traded interest and principal component
parts of U.S. Treasury obligations that are issued by banks and brokerage firms
and are created by depositing U.S. Treasury obligations into a special account
at a custodian bank. The custodian holds the interest and principal payments for
the benefit of the registered owners of the certificates or receipts. Receipts
include Treasury Receipts (TRs), Treasury Investment Growth Receipts (TIGRs) and
Certificates of Accrual on Treasury Securities (CATS). TRs, TIGRs, and CATS are
sold as zero coupon securities.
ZERO COUPON SECURITIES
A zero coupon security pays no interest or principal to its holder during its
life. A zero coupon security is sold at a discount, frequently substantial, and
redeemed at face value at its maturity date. The market prices of zero coupon
securities are generally more volatile than the market prices of securities of
similar maturity that
15
<PAGE>
PROSPECTUS 1784 FUNDS
================================================================================
pay interest periodically, and zero coupon securities are likely to react more
to interest rate changes than non-zero coupon securities with similar maturity
and credit qualities.
BANK OBLIGATIONS
Bank obligations include certificates of deposit, time deposits (including
Eurodollar time deposits) and bankers' acceptances and other short-term debt
obligations issued by domestic banks, foreign subsidiaries or foreign branches
of domestic banks, domestic and foreign branches of foreign banks, domestic
savings and loan associations and other banking institutions. The Funds have
established certain minimum credit quality standards for bank obligations in
which they invest.
BANKERS' ACCEPTANCES
A banker's acceptance is a bill of exchange or time draft drawn on and accepted
by a commercial bank. It is used by corporations to finance the shipment and
storage of goods and to furnish dollar exchange. Maturities are generally six
months or less.
CERTIFICATES OF DEPOSIT
A certificate of deposit is a negotiable interest-bearing instrument with a
specific maturity. Certificates of deposit are issued by banks and savings and
loan institutions in exchange for the deposit of funds and normally can be
traded in the secondary market prior to maturity.
TIME DEPOSITS
A time deposit is a non-negotiable receipt issued by a bank in exchange for the
deposit of funds. Like a certificate of deposit, it earns a specified rate of
interest over a definite period of time; however, it cannot be traded in the
secondary market. Time deposits with a withdrawal penalty are considered to be
illiquid securities. COMMERCIAL PAPER Commercial paper is the term used to
designate unsecured short-term promissory notes issued by corporations and other
entities. Maturities on these issues vary from one to 270 days.
MONEY MARKET FUNDS
A money market fund is a mutual fund that limits its investments to high quality
money market instruments with a weighted average maturity of 90 days or less.
Consistent with applicable regulations the Funds may not invest more than
certain percentages of their assets in other mutual funds. Investing in other
mutual funds causes shareholders to bear not only Fund expenses, but also
expenses of the underlying mutual funds.
VARIABLE AND FLOATING RATE INSTRUMENTS
Certain obligations may carry variable or floating rates of interest and may
involve a conditional or unconditional demand feature permitting the holder to
demand payment of principal at any time or at specified intervals. These
obligations may include variable amount master demand notes. Such instruments
bear interest at rates which are not fixed, but which vary with changes in
specified market rates or indices, such as a Federal Reserve composite index. A
demand instrument with a demand notice period exceeding seven days may be
considered illiquid if there is no secondary market for such security. The
interest rate on these securities may be reset daily, weekly, quarterly, or some
other reset period and may have a floor or ceiling on interest rate charges.
There is a risk that the current interest rate on such obligations may not
accurately reflect existing market interest rates.
REPURCHASE AGREEMENTS
A repurchase agreement is an agreement where a person buys a security and
simultaneously commits to sell the security to the seller at an agreed upon
price (including principal and interest) on an agreed upon date within a number
of days from the date of purchase. A Fund bears a risk of loss in the event the
other party defaults on its obligations and the Fund is delayed or prevented
from its right to dispose of the collateral securities or if the Fund realizes a
loss on the sale of the collateral securities. Pursuant to an exemptive order
from the SEC, the Funds may enter into repurchase agreements on a pooled basis.
(CONTINUED)
16
<PAGE>
PROSPECTUS 1784 FUNDS
APPENDIX B (CONTINUED)
================================================================================
REVERSE REPURCHASE AGREEMENTS
Reverse repurchase agreements involve the sale of
securities held by a Fund and the agreement by the Fund to repurchase the
securities at an agreed-upon price, date and interest payment. When a Fund
enters into reverse repurchase transactions, securities of a dollar amount equal
in value to the securities subject to the agreement will be maintained in a
segregated account with the Fund's custodian. The segregation of assets could
impair the Fund's ability to meet its current obligations or impede investment
management if a large portion of the Fund's assets are involved. Reverse
repurchase agreements are considered to be a form of borrowing.
FORWARD COMMITMENTS OR PURCHASES
ON A WHEN-ISSUED BASIS
Forward commitments or purchases of securities on a when-issued basis are
transactions where the price of the securities is fixed at the time of
commitment and the delivery and payment ordinarily takes place beyond customary
settlement time. The interest rate realized on these securities is fixed as of
the purchase date and no interest accrues to the buyer before settlement. The
securities are subject to market fluctuation due to changes in market interest
rates; the securities are also subject to fluctuation in value pending
settlement based upon public perception of the creditworthiness of the issuer of
these securities. Each Fund may invest up to 25% of its assets in forward
commitments or commitments to purchase securities on a when-issued basis.
MUNICIPAL SECURITIES
Municipal securities include debt obligations issued by or on behalf of public
authorities to obtain funds to be used for various public facilities, for
refunding outstanding obligations and for general operating expenses. Municipal
securities also include debt obligations issued to obtain funds for lending to
other public institutions and facilities, and certain private activity and
industrial development bonds issued by or on behalf of public authorities to
obtain funds to provide for the construction, equipment, repair or improvement
of privately operated facilities. Municipal notes include general obligation
notes, tax anticipation notes, revenue anticipation notes, bond anticipation
notes, certificates of indebtedness, demand notes and construction loan notes.
Municipal bonds include general obligation bonds, revenue or special obligation
bonds, private activity and industrial development bonds. General obligation
bonds are backed by the taxing power of the issuing municipality. Revenue bonds
are backed by the revenues of a project or facility. The payment of principal
and interest on private activity and industrial development bonds generally is
dependent solely on the ability of the facility's user to meet its financial
obligations and the pledge, if any, of real and personal property financed with
the proceeds of these bonds as security for such payment. Municipal securities
also include participations in municipal leases. These are undivided interests
in a portion of a lease or installment purchase issued by state or local
government to acquire equipment or facilities. Municipal leases frequently have
special risks not normally associated with general obligation bonds or revenue
bonds. Many leases include "non-appropriation" clauses that provide that the
governmental issuer has no obligation to make future payments under the lease or
contract unless money is appropriated for such purpose by the appropriate
legislative body on a yearly or other periodic basis. Although the obligations
will be secured by the leased equipment or facilities, the disposition of the
property in the event of non-appropriation or foreclosure might, in some cases,
prove difficult.
STANDBY COMMITMENTS
A security purchased subject to a standby commitment may be sold at a fixed
price prior to maturity and may be sold at any time at market rates. A premium
may be paid for a standby commitment and will have the effect of reducing the
yield otherwise payable on the underlying security. There is no limit to the
percentage of Fund securities that any Fund may purchase subject to a standby
commitment but the amount paid directly or indirectly for a standby commitment
held by any Fund will not exceed 1/2 of 1% of the value of the total assets of
the Fund.
17
<PAGE>
PROSPECTUS 1784 FUNDS
SECURITIES LENDING
Consistent with applicable regulatory requirements and in order to generate
additional income, each Fund may lend securities to broker-dealers and other
institutional borrowers. Loans must be callable at any time and continuously
secured by collateral (cash or U.S. government securities) in an amount not less
than the market value, determined daily, of the securities loaned. It is
intended that the value of securities loaned by a Fund would not exceed 331/3%
of the Fund's total assets. In the event of the bankruptcy of the other party to
a securities loan, a Fund could experience delays in recovering either the
securities lent or cash. To the extent that, in the meantime, the value of the
securities lent has increased or the value of the securities purchased has
decreased, the Fund could experience a loss. The voting rights of such
securities may pass to the borrower; however, the lending Fund will seek to call
loans, to vote proxies, or otherwise to obtain rights to vote or consent if a
material event affecting the investment is to occur.
RESTRICTED OR ILLIQUID SECURITIES
Securities that may not be sold freely to the public absent registration or
securities for which there is no readily available market are referred to as
restricted or illiquid securities, respectively. Each Fund may invest up to 10%
of its net assets in illiquid securities, including restricted securities that
are illiquid. The absence of a trading market can make it difficult to ascertain
a market value for these investments. Disposing of illiquid securities may
involve time-consuming negotiation and legal expense, and it may be difficult or
impossible for a Fund to sell them promptly at an acceptable price.
18
<PAGE>
PROSPECTUS 1784 FUNDS
NOTES
- --------------------------------------------------------------------------------
19
<PAGE>
NEW ACCOUNT APPLICATION
MAIL TO: 1784 FUNDS, P.O. BOX 8524, BOSTON, MA 02266-8524
FOR INFORMATION, CALL: 1784 FUNDS, 1-800-252-1784
- --------------------------------------------------------------------------------
[LOGO]
1784 Funds
PLEASE PRINT CLEARLY ALL ITEMS EXCEPT SIGNATURE
1. SHAREHOLDER REGISTRATION
================================================================================
- --------------------------------------------------------------------------------
OWNER'S FIRST NAME MIDDLE INITIAL LAST NAME
- --------------------------------------------------------------------------------
JOINT OWNER'S FIRST NAME MIDDLE INITIAL LAST NAME
- --------------------------------------------------------------------------------
ADDRESS
- --------------------------------------------------------------------------------
CITY STATE ZIP
( ) ( )
- --------------------------------------------------------------------------------
DAYTIME PHONE EVENING PHONE
- --------------------------------------------------------------------------------
OWNER: SOCIAL SECURITY OR TAX I.D. NUMBER
- --------------------------------------------------------------------------------
JOINT OWNER; SOCIAL SECURITY OR TAX I.D. NUMBER
- --------------------------------------------------------------------------------
DATE OF BIRTH OCCUPATION
[] U.S. Citizen [] Other _________________________________
SPECIFY
2. TYPE OF ACCOUNT
================================================================================
COMPLETE ONE SECTION ONLY.
[] Individual
[] Joint Owner (cannot be a minor)
[] Uniform Gift or Transfer to Minor:
- ------------------------------------------------------------- as a custodian for
CUSTODIAN'S NAME (ONLY ONE PERMITTED)
- --------------------------------------------------------------------------------
MINOR'S NAME (ONLY ONE PERMITTED)
- --------------------------------------------------------------------------------
MINOR'S SOCIAL SECURITY NUMBER MINOR'S DATE OF BIRTH
[] A Trust (including Corporate Pension Plans):
- -------------------------------------------------------------- as Trustee(s) for
NAME OF TRUSTEE(S)
- --------------------------------------------------------------------------------
NAME OF TRUST TRUST ACCOUNT NUMBER
under agreement date -----------------------------------------------------------
DATE OF TRUST AGREEMENT
[] A Corporation, Partnership or other entity:
- --------------------------------------------------------------------------------
NAME OF CORPORATION OR OTHER ENTITY
3. 1784 FUNDS INVESTMENT SELECTION
================================================================================
CHECK THE FUND(S) AND INDICATE THE AMOUNT OF INVESTMENT FOR EACH FUND. ENCLOSE
ONE CHECK MADE PAYABLE TO EACH FUND IN WHICH YOU WILL BE INVESTING. MINIMUM
INITIAL INVESTMENT: $1000 PER FUND, $100,000 FOR INSTITUTIONAL U.S. TREASURY
MONEY MARKET FUND.
[] 1784 U.S. Treasury Money Market Fund (902) $_____________
[] 1784 Prime Money Market Fund (932) $_____________
[] 1784 Tax-Free Money Market Fund (901) $_____________
[] 1784 Institutional U.S. Treasury
Money Market Fund (903) $_____________
METHOD OF PAYMENT:
[] Enclosed is my check(s) made payable to the Fund(s)
I have chosen.
[] Debit my attached checking or savings account
- --------------------------------------------------------------------------------
ACCOUNT NUMBER
4. AUTHORIZATION OF TELEPHONE TRANSFER
================================================================================
CHECK ONE OR MORE BOXES TO AUTHORIZE TELEPHONE EXCHANGES AND/OR WIRE TRANSFERS,
AND/OR ACH TRANSFERS, AND/OR CHECK REDEMPTION.
I/We authorize the Shareholder Servicing Agent of the 1784 Funds, to act upon
instructions received by telephone from me/us to perform the following services:
[] EXCHANGE BETWEEN FUNDS
[] WIRE TRANSFER: I/We understand that a fee is charged each time I/we request
a wire redemption. PLEASE COMPLETE SECTION 6.
[] ACH: PLEASE COMPLETE SECTION 5.
[] SEND CHECK TO ADDRESS OF RECORD
5. BANK WIRE AND ACH INSTRUCTIONS
================================================================================
If you wish to redeem with payment via wire transfer or ACH, or make use of the
Systematic Investment Plan, YOU MUST ATTACH A
VOIDED CHECK OR DEPOSIT SLIP FOR THE BANK ACCOUNT YOU WISH TO USE, AND provide
full bank account information as shown below. Any change in these instructions
must be made in writing to 1784 Funds.
- --------------------------------------------------------------------------------
| ATTACH VOIDED CHECK OR DEPOSIT SLIP HERE |
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
BANK NAME BRANCH OFFICE (IF APPLICABLE)
- --------------------------------------------------------------------------------
BANK ADDRESS (DO NOT USE P.O. BOX)
- --------------------------------------------------------------------------------
CITY STATE ZIP
- --------------------------------------------------------------------------------
NAME(S) ON BANK ACCOUNT
- --------------------------------------------------------------------------------
BANK ACCOUNT NUMBER BANK ABA NO.
ACCOUNT TYPE (CHECK ONE): [] Checking
[] Savings/Money Market
6. SYSTEMATIC INVESTMENT PLAN (OPTIONAL)
================================================================================
IF YOU CHOOSE THIS OPTION, YOU MUST ATTACH A VOIDED CHECK AND PROVIDE FULL BANK
INFORMATION IN SECTION 5.
[] Check box if you want this service.
I/We authorize the Shareholder Servicing Agent of 1784 Funds to draw on my/our
bank account on a periodic basis, as indicated below, for investment in my/our
1784 Funds account. I/We understand that if there are insufficient funds in
my/our account service charges may apply.
[] I/We have attached a voided check, and have provided bank information in
Section 5.
[] Periodic investment amount $_________________________________________________
($50 MINIMUM/MONTH)
[] Name of 1784 Fund____________________________________________________________
PREFERRED INVESTMENT SCHEDULE:
[] Semi-monthly, on the
5th and 20th of each month beginning_________________________________________
(MONTH)
[] Monthly, on the (check one):
[] 5th day of each month beginning ________________________________________
(MONTH)
[] 20th day of each month beginning _______________________________________
(MONTH)
PLEASE COMPLETE ON OTHER SIDE
<PAGE>
7. SHAREHOLDER AGREEMENT
================================================================================
In this Agreement, "I," "my," "you" and "your" means each customer individually
and/or any two or more customers signing this Agreement.
[] I have full right, power, authority and legal capacity to purchase shares
of the Fund(s) and such purchases are not illegal in my state of residence.
I affirm that I have received and read the current prospectus(es) of the
Fund(s) selected on the first page and agree to its terms. I understand the
investment objectives and program, and have determined that the Fund(s)
is/are a suitable investment, based upon my investment needs and financial
situation. I agree that neither SEI Financial Services Company (SFS), Bank
of Boston, 1784 Funds, the Shareholder Servicing Agent nor any bank or
broker-dealer through which purchases may be made, nor any affiliate of any
of the foregoing or any other of their agents, officers, directors, or
employees ("Other Parties") will be liable for any loss, expense, or cost
from my investment decision, nor from acting upon my instructions received
by telephone, if the procedures described in the prospectus(es) concerning
verification are followed.
[] I understand that the authorization(s) with respect to telephone
transactions, wire redemption and ACH are subject to the conditions and
limitations set forth in the current prospectus(es). I ratify any
instructions given pursuant to the above authorization(s) and agree that no
Other Party will be liable for any loss, expense, or cost from my
investment decision, nor from acting upon my instructions or inquiries
believed genuine, including instructions received by telephone if the
procedures described in the prospectus(es) concerning verification are
followed. I authorize you to honor all debit and credit entries initiated
by me. All my debits are subject to sufficient collected funds in the
account noted above. I further agree that if any such entries are
dishonored with good and sufficient cause, no Other Party shall be under
any liability whatsoever.
[] I understand and acknowledge that shares of the 1784 Funds are not insured
by the FDIC or any other government agency; are not deposits or other
obligations of, or guaranteed by any bank; and involve investment risks,
including possible loss of the principal amount invested.
[] I understand and agree that any telephone conversation with BFDS or any
bank or broker-dealer or any of their affiliates may be recorded for
accuracy.
[] This Agreement shall be governed by the laws of the Commonwealth of
Massachusetts. Unless otherwise specified, Uniform Gifts or Transfers to
Minor's Accounts will be governed by the Uniform Gifts or Transfers to
Minor's Act of the Custodian's state as of account opoening
8. SIGNATURE & CERTIFICATION
================================================================================
Under the penalties of the perjury, I certify the following:
[] The number shown on this form is my/our correct Social Security or Taxpayer
Identification Number.
[] I am not subject to back-up witholding either because I have not been
notified that I am subject to back-up witholding as a result of a failure
to report all interest and dividends, or the International Revenue Service
has notified me that I am no longer subject to back-up witholding, or I am
exempt from back-up witholding.
[] I hereby authorize the Shareholder Servicing Agent to deposit or withdraw
funds, described above, to my account at the financial institution named in
Section 5 and to adjust any over-deposit or under-withdrawal which is
caused to be made to my account. I will not hold the financial institution
named above liable for any erroneous deposits, withdrawals, or adjustments
made by the Shareholder Servicing Agent.
X_______________________________________________________________________________
SIGNATURE (INDIVIDUAL OR CUSTODIAN) DATE
X_______________________________________________________________________________
SIGNATURE (JOINT REGISTRANT, IF ANY) DATE
X_______________________________________________________________________________
SIGNATURE AND TITLE DATE
(CORPORATE OFFICER, PARTNER, TRUSTEE, ETC.)
[] Check box if you have received IRS notification that you are subject to
back-up witholding.
9. FOR NON-RESIDENT ALIENS ONLY
================================================================================
Substitute W-8 FORM Certificate of Foreign Status
(Non-Resident Alien)
[] Under penalties of perjury, I certify that, to the best of my knowledge
and belief, I qualify as a foreign person because
I am not an U.S. citizen or resident.
X_______________________________________________________________________________
SIGNATURE OF APPLICANT DATE
________________________________________________________________________________
PERMANENT ADDRESS
Substitute W-8 FORM Certificate of Foreign Status
(Non-Resident Alien Co-Applicant)
[] Under penalties of perjury, I certify that, to the best of my knowledge and
belief, I qualify as a foreign person because I am not an U.S. citizen or
resident.
X_______________________________________________________________________________
SIGNATURE OF CO-APPLICANT DATE
________________________________________________________________________________
PERMANENT ADDRESS
THANK YOU FOR YOUR INVESTMENT, YOU WILL RECEIVE
WRITTEN CONFIRMATION SHORTLY.
- --------------------------------------------------------------------------------
| |
| FOR INTERNAL USE ONLY: |
| ------------------------------------------------------------------- |
| |
| ___________________________________________________________________ |
| DEPOSIT ACCOUNT # |
| ___________________________________________________________________ |
| BANK CODE RC |
| ___________________________________________________________________ |
| NAME OF REPRESENTATIVE NUMBER |
| |
| SOURCE OF BUSINESS/SOURCE OF FUNDS___ ___ ___ ___ / ___ ___ ___ ___ |
| |
| [] BKBCUSTOMER [] NON-BKB CUSTOMER_________________________________ |
| |
- --------------------------------------------------------------------------------
(10/96)
<PAGE>
CORPORATE RESOLUTION FORM
MAIL TO: 1784 FUNDS, P.O. BOX 8524, BOSTON, MA 02266-8524
FOR INFORMATION, CALL: 1784 FUNDS, 1-800-252-1784
- --------------------------------------------------------------------------------
[LOGO]
1784 Funds
THIS FORM IS REQUIRED TO REDEEM 1784 FUND SHARES BY TELEPHONE FOR CORPORATIONS,
BUSINESS TRUSTS, PARTNERSHIPS AND OTHER SIMILAR ORGANIZATIONS ONLY AND MUST
ACCOMPANY A COMPLETED NEW ACCOUNT APPLICATION.
(1.) RESOLUTIONS FOR TELEPHONE REDEMPTION
- --------------------------------------------------------------------------------
RESOLVED: In connection with any funds invested
in shares of
- --------------------------------------------------------------------------------
NAME OF 1784 FUND(S) AND ACCOUNT NUMBER
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TITLE(S) OR NAME(S) OF THOSE WITH AUTHORITY
(are) (is) hereby authorized to execute the Telephone Redemption Authorization,
included in the accompanying application, and to name the following bank as the
recipient of the proceeds of any such redemption:
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- --------------------------------------------------------------------------------
FURTHER RESOLVED: That the (Clerk) (Assistant Clerk) (Secretary) (Assistant
Secretary) (Managing Partner) (Member) (Manager) be and hereby is authorized and
directed to certify the foregoing resolution and that the provisions thereof are
in conformity with the (Articles of Organization) (Certificate of Incorporation)
(Charter) (Declaration of Trust) (Partnership Agreement) and (By-Laws)
(Operating Agreement) of this (Corporation) (Trust) (Partnership) (Limited
Liability Company).
(2.) APPOINTMENT OF AGENT FOR TELEPHONE REDEMPTION AUTHORIZATION
- --------------------------------------------------------------------------------
We, the undersigned, constitute and appoint Bay Bank Systems, Inc., or such
other entity as may be the Shareholder Servicing Agent for 1784 Funds (the
"SSA"), our true and lawful attorney to surrender for redemption any and all
shares held by
- --------------------------------------------------------------------------------
ACCOUNT NAME AND ADDRESS
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- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
with full power of substitution in the premises. SSA is hereby authorized and
directed to accept and act upon any telephone directions for redemptions of
shares held in the above account from any person who requests payment to be made
to the bank account identified in the Application Form submitted herewith. We
understand and agree that SSA will not be liable for any loss, expense or costs
arising out of any telephone request for redemption as long as SSA acts in
accordance with the telephone redemption procedures as described in the
prospectus of the 1784 Funds, as amended from time to time. (This authorization
and the following certificate must be completed and received by SSA before
telephone, ACH or wire redemption requests for transmission of funds will be
honored. Any amendment or modification of the above information will require
that a new Corporate Resolution Form be completed and submitted, with a
completed Telephone Redemption Form with a signature guarantee.) We hereby
certify that each of the persons listed below has been duly elected and is now
legally holding the office set forth opposite his name.
PLEASE PRINT OR TYPE FULL NAME AND TITLES
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
SIGNATURE
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
SIGNATURE
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
SIGNATURE
We further certify that said
- --------------------------------------------------------------------------------
TYPE OF ORGANIZATION
is duly organized and existing, and has the power to take action called for by
the foregoing resolutions.
We further certify and agree that the above certifications, authorizations and
appointments will continue until SSA receives actual written notice of any
change thereof.
PLEASE COMPLETE OTHER SIDE
<PAGE>
(3.) CERTIFICATION
- --------------------------------------------------------------------------------
I hereby certify that the foregoing resolutions relating to
[] Telephone Redemption
are in conformity with the (Articles of Organization) (Certificate of
Incorporation) (Charter) (Declaration of Trust) (Partnership) Agreement) and the
(By-Laws) (Operating Agreement) of the
- --------------------------------------------------------------------------------
NAME OF ORGANIZATION
organized under the laws of_____________________and were
STATE
adopted at a meeting of the (Board of Directors) (Trustees) (Partners) (Members)
of the (Corporation) (Trust) (Partner-ship) (Limited Liability Company) duly
called and held on
- --------------------------------------------------------------------------------
DATE
at which quorum was present and acting throughout, and that the same are now in
full force and effect. I further certify that the following is (are) the duly
elected officer(s) of the (Corporation) (Trust) (Partnership) (Limited Liability
Company), authorized to act in accordance with the foregoing resolutions.
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NAMES AND TITLES
Witness my (our) hand(s) and the seal of the(Corporation) (Trust) (Partner-ship)
(Limited Liability Company) this __________________day of_________________,
19____.
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SECRETARY, CLERK, MANAGING PARTNER, MEMBER OR MANAGER CONFIRMED
- --------------------------------------------------------------------------------
OTHER OFFICER
*If the Secretary or other recording officer is authorized to act by the above
resolutions, this certificate must also be signed by another officer.
BKB-M-024-02
<PAGE>
1784 MONEY MARKET FUNDS
- --------------------------------------------
INVESTMENT CHOICES TO MEET A RANGE OF GOALS.
In addition to money market funds, the 1784
Funds family includes stock, bond, and tax-exempt funds to meet a wide range of
investment goals. You may select individual funds to target very specific
investment objectives or combine 1784 Funds to create an entire portfolio
structured in the most effective way to meet your long-term goals.
BOND FUNDS
1784 U.S. Government Medium-Term Income Fund
1784 Short-Term Income Fund
1784 Income Fund
TAX-EXEMPT INCOME FUNDS
1784 Tax-Exempt Medium-Term Income Fund
1784 Connecticut Tax-Exempt Income Fund
1784 Florida Tax-Exempt Income Fund
1784 Massachusetts Tax-Exempt Income Fund
1784 Rhode Island Tax-Exempt Income Fund
STOCK FUNDS
1784 Asset Allocation Fund
1784 Growth and Income Fund
1784 Growth Fund
1784 International Equity Fund
FOR MORE COMPLETE INFORMATION ON ALL THE 1784 FUNDS, INCLUDING FEES AND CHARGES,
PLEASE CALL 1-800-252-1784 FOR A FREE PROSPECTUS. PLEASE READ THE PROSPECTUS
CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
[LOGO]
1784 FUNDS
THE SIMPLE,
CONVENIENT WAY
TO INVEST.
[BULLET] NO-LOAD INVESTING--
No sales charges, exchange or
redemption fees.
[BULLET] LOW MINIMUM INVESTMENT--
Initial investment of $1,000 with
additional investments as low as $250.
[BULLET] AUTOMATIC INVESTMENT OF AS LITTLE AS $50--
Arrange to have funds automatically
invested from your bank account.
[BULLET] 24-HOUR ACCESS--
Automated account information at
1-800-252-1784 24-hours a day.
[BULLET] MONTHLY INVESTMENT STATEMENT--
Receive information on all your
1784 Funds monthly. In addition you'll
receive written confirmation each time
you buy or sell shares.
Note: The Institutional U.S. Treasury Money Market Fund has higher minimums for
initial investment and automatic investment.
[LOGO]
1784 FUNDS
SOUND CHOICES. STRAIGHT TALK.
INVESTMENT MANAGEMENT STRENGTH.
1-800-252-1784
NOT PART OF THE PROSPECTUS
<PAGE>
1784 FUNDS
================================================================================
MONEY MARKET FUNDS
1784 U.S. Treasury Money Market Fund
1784 Prime Money Market Fund
1784 Tax-Free Money Market Fund
1784 Institutional U.S. Treasury Money Market Fund
BOND FUNDS
1784 U.S. Government Medium-Term Income Fund
1784 Short-Term Income Fund
1784 Income Fund
TAX-EXEMPT INCOME FUNDS
1784 Tax-Exempt Medium-Term Income Fund
1784 Connecticut Tax-Exempt Income Fund
1784 Florida Tax-Exempt Income Fund
1784 Massachusetts Tax-Exempt Income Fund
1784 Rhode Island Tax-Exempt Income Fund
STOCK FUNDS
1784 Asset Allocation Fund
1784 Growth and Income Fund
1784 Growth Fund
1784 International Equity Fund
FOR MORE INFORMATION,
CALL 1-800-252-1784.
[LOGO]
1784 FUNDS
SOUND CHOICES. STRAIGHT TALK.
INVESTMENT MANAGEMENT STRENGTH.
NOT PART OF THE PROSPECTUS
BKB-F-03901 (11/96) Z00414
