<PAGE>
MARQUIS FUNDS (R)
. GOVERNMENT SECURITIES FUND
. STRATEGIC INCOME BOND FUND
. LOUISIANA TAX-FREE INCOME FUND
. BALANCED FUND
. VALUE EQUITY FUND
. GROWTH EQUITY FUND
. SMALL CAP EQUITY FUND
. INTERNATIONAL EQUITY FUND
SUPPLEMENT DATED MARCH 18, 1997 TO PROSPECTUS DATED JANUARY 28, 1997, AS
SUPPLEMENTED MARCH 4, 1997
From April 15, 1997 through May 15, 1997, purchases of Class A shares of the
Marquis Louisiana Tax-Free Income Fund (the "Fund") will not be subject to a
sales charge. This offer covers purchases of new shares only and does not apply
to previously purchased shares.
Effective May 15, 1997, the 3.50% front-end sales charge normally imposed on
Class A shares of the Fund will be reinstated.
----------------
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
MRQ-F-022-01
<PAGE>
PROSPECTUS -- DATED JANUARY 28, 1997
as supplemented March 4, 1997
TREASURY SECURITIES MONEY MARKET FUND
TAX EXEMPT MONEY MARKET FUND
Cash Sweep Class
[LOGO OF MARQUIS(SM) FAMILY OF FUNDS APPEARS HERE]
MARQUIS(SM)
FAMILY OF FUNDS
High Quality. High Standards. Highly Personal.
<PAGE>
MARQUIS FUNDS (R)
Investment Adviser:
FIRST NATIONAL BANK OF COMMERCE IN NEW ORLEANS
.TREASURY SECURITIES MONEY MARKET FUND
.TAX EXEMPT MONEY MARKET FUND
MARQUIS FUNDS (R) (the "Trust") is a mutual fund that offers a convenient and
economical means of investing in one or more professionally managed portfolios
of securities. This Prospectus offers the Cash Sweep Class shares of the
TREASURY SECURITIES MONEY MARKET FUND and TAX EXEMPT MONEY MARKET FUND (the
"Funds"), each a separate series of the Trust.
This Prospectus sets forth concisely the information about the Funds and the
Trust that a prospective investor should know before investing in the Funds.
Investors are advised to read this Prospectus and retain it for future
reference. A Statement of Additional Information dated January 28, 1997, as
supplemented from time to time, has been filed with the Securities and
Exchange Commission (the "SEC") and is available without charge by calling
1-800-471-1144. The Statement of Additional Information is incorporated into
this Prospectus by reference.
AN INVESTMENT IN THE FUNDS IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT AND THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
- --------------------------------------------------------------------------------
THE TRUST'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY ANY BANK, INCLUDING FIRST NATIONAL BANK OF COMMERCE IN NEW
ORLEANS OR ANY OF ITS AFFILIATES OR CORRESPONDENTS, INCLUDING FIRST COMMERCE
CORPORATION. THE TRUST'S SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY. INVESTMENT IN THE SHARES INVOLVES RISK, INCLUDING
POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED.
- --------------------------------------------------------------------------------
JANUARY 28, 1997, AS SUPPLEMENTED MARCH 4, 1997
<PAGE>
SUMMARY
MARQUIS FUNDS (R) (the "Trust") is an open-end management investment company
providing a convenient way to invest in professionally managed portfolios of
securities. This Summary provides basic information about the Cash Sweep Class
shares of the Trust's Treasury Securities Money Market Fund (the "Treasury
Fund") and Tax Exempt Money Market Fund (the "Tax Exempt Fund") (collectively,
the "Funds"). Each Fund is a separate series of the Trust.
WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE FUND? The Treasury Fund
seeks to preserve principal value and maintain a high degree of liquidity while
providing current income by investing exclusively in obligations issued by the
U.S. Treasury and in repurchase agreements involving such obligations. The Tax
Exempt Fund seeks to preserve principal value and maintain a high degree of
liquidity while providing current income exempt from Federal income taxes by
investing, under normal market conditions, at least 80% of its net assets in
eligible securities issued by or on behalf of the states, territories, and
possessions of the United States and the District of Columbia and their
political subdivisions, agencies, and instrumentalities, the interest on which
is exempt from Federal income tax. There can be no assurance that either Fund
will achieve its investment objective.
WHAT ARE THE RISKS INVOLVED WITH AN INVESTMENT IN THE FUNDS? The investment
policies of each Fund entail certain risks and considerations of which an
investor should be aware. While each Fund seeks to maintain a net asset value
of $1.00 per share, there can be no assurance that either Fund will be able to
do this on a continuous basis. There may be other risks involved in the
ownership of money market mutual funds.
ARE MY INVESTMENTS INSURED? Any guaranty by the U.S. Government, its agencies
or instrumentalities of the securities in which either Fund invests guarantees
only the payment of principal and interest on the guaranteed security and does
not guarantee the yield or value of that security or the yield or value of
shares of that Fund. The Trust's shares are not federally insured by the FDIC
or any other government agency.
For more information about each Fund, see "Investment Objective and Policies,"
"General Investment Policies" and "Description of Permitted Investments and
Risk Factors."
HOW DO I PURCHASE SHARES? Cash Sweep Class shares of the Funds are offered at
net asset value per share. Cash Sweep Class shares of the Treasury Fund and Tax
Exempt Fund are subject to annual distribution fees of .50% and .60%,
respectively, of the average daily net assets.
WHO IS THE ADVISER? The Trust Group of First National Bank of Commerce in New
Orleans serves as the investment adviser of each Fund. Additionally, Weiss,
Peck & Greer, L.L.C. serves as investment sub-adviser (the "sub-adviser") to
the Tax Exempt Fund. See "Expense Summary," "The Adviser" and "The Sub-
Adviser."
WHO IS THE ADMINISTRATOR? SEI Fund Resources serves as the administrator of the
Trust. See "Expense Summary" and "The Administrator."
WHO IS THE TRANSFER AGENT? DST Systems, Inc. serves as shareholder servicing
agent, transfer agent and dividend disbursing agent for the Trust. See "The
Shareholder Servicing Agent and Transfer Agent."
WHO IS THE DISTRIBUTOR? SEI Financial Services Company serves as distributor of
the Trust's shares. See "The Distributor."
HOW ARE DIVIDENDS PAID? Substantially all of the net investment income
(exclusive of capital gains) of each Fund is distributed in the form of monthly
dividends. Any capital gain is distributed at least annually. Dividends are
paid in additional shares unless the shareholder elects to take payment in cash
on the first Business Day of each month. See "Dividends."
<PAGE>
EXPENSE SUMMARY
<TABLE>
<CAPTION>
TREASURY SECURITIES TAX EXEMPT
MONEY MARKET FUND MONEY MARKET FUND
SHAREHOLDER TRANSACTION EXPENSES CASH SWEEP CLASS CASH SWEEP CLASS
- --------------------------------------------------------------------------------
<S> <C> <C>
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) None None
Maximum Sales Load Imposed on Reinvested
Dividends
(as a percentage of offering price) None None
Maximum Contingent Deferred Sales Charge
(as a percentage of original purchase
price or redemption proceeds, as
applicable) None None
Wire Redemption Fee $25 $25
Exchange Fee None None
<CAPTION>
ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)
- --------------------------------------------------------------------------------
<S> <C> <C>
Management Fees (after fee waivers) (1) .29% .35%
12b-1 Fees (1) .50% .60%
Other Expenses .21% .30%
- --------------------------------------------------------------------------------
Total Operating Expenses (after fee waiv-
ers) (2) 1.00% 1.25%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
(1) The Adviser has voluntarily agreed to waive a portion of its advisory fee
and the Distributor has voluntarily agreed to waive 12b-1 fees to the
extent necessary to keep "Total Operating Expenses" for the Cash Sweep
Class shares of the Treasury Fund and Tax Exempt Fund from exceeding 1.00%
and 1.25%, respectively. The Adviser and the Distributor reserve the right
to terminate their waivers at any time in their sole discretion. Absent
such waivers, the advisory fee for the Treasury Fund and Tax Exempt Fund
would be .30% and .45%, respectively, and the 12b-1 fee for the Cash Sweep
Class shares of the Funds would be .75%.
(2) Absent the Adviser's and the Distributor's voluntary fee waivers, Total
Operating Expenses for Cash Sweep Class shares of the Treasury Fund and
Tax Exempt Fund would be 1.26% and 1.50%, respectively. Total Operating
Expenses have been restated to reflect current fees.
EXAMPLE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------
1 YEAR 3 YEARS
- ------------------------------------------------------------------------------
<S> <C> <C>
You would pay the following expenses on a $1,000 investment in
Cash Sweep Class shares assuming (1) 5% annual return and
(2) redemption at the end of each time period:
Treasury Money Market Fund $10 $32
Tax Exempt Money Market Fund $13 $40
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES AND ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. BECAUSE
THE CASH SWEEP CLASS OF EACH FUND WERE NOT OPERATIONAL AS OF THE DATE OF THIS
PROSPECTUS, THE FUNDS HAVE NOT PROJECTED EXPENSES BEYOND THE THREE-YEAR PERIOD
SHOWN.
The purpose of this table is to assist the investor in understanding the
various costs and expenses that may be directly or indirectly borne by
investors in Cash Sweep Class shares of the Fund. The information set forth in
the foregoing table and example relates only to Cash Sweep Class shares. The
Treasury Fund also offers Trust Class shares and both Funds offer Retail Class
shares of the Fund which are subject to the same expenses except that Trust
Class shares are not charged distribution expenses and Retail shares are
charged lower distribution expenses than Cash Sweep shares. Shareholders
purchasing shares through a financial institution may be charged additional
account fees by that institution. Additional information may be found under
"The Adviser," "The Administrator" and "The Distributor."
3
<PAGE>
THE TRUST
MARQUIS FUNDS(R) (the "Trust") is an open-end management investment company
that offers units of beneficial interest ("shares") in the Funds, through
separate classes: Trust Class (Treasury Fund only), Retail Class and Cash Sweep
Class which provide for variations in distribution costs, voting rights and
dividends. Except for these differences between classes, each share of each
Fund represents an undivided, proportionate interest in that Fund. This
Prospectus relates to the Cash Sweep Class shares of the Funds. Information
regarding the Trust Class shares of the Treasury Fund, Retail Class shares of
both Funds and the Trust's other funds is contained in separate prospectuses
that may be obtained by calling 1-800-471-1144.
INVESTMENT OBJECTIVE AND POLICIES FOR THE TREASURY FUND
THE TREASURY FUND seeks to preserve principal value and maintain a high degree
of liquidity while providing current income. There can be no assurance that the
Fund will be able to achieve its investment objective.
The Fund invests exclusively in obligations issued by the U.S. Treasury
("Treasury Obligations") and backed by its full faith and credit and in
repurchase agreements involving such obligations.
INVESTMENT OBJECTIVE AND POLICIES FOR THE TAX EXEMPT FUND
THE TAX EXEMPT FUND seeks to preserve principal value and maintain a high
degree of liquidity while providing current income exempt from Federal income
taxes. There can be no assurance that the Fund will be able to achieve its
investment objective.
Under normal market conditions, the Fund will invest at least 80% of its net
assets in eligible securities issued by or on behalf of the states, territories
and possessions of the United States and the District of Columbia and their
political subdivisions, agencies and instrumentalities, the interest on which
is exempt from Federal income tax (collectively, "Municipal Securities"). The
Fund will invest at least 80% of its assets in Municipal Securities the
interest on which is not treated as a preference item for purposes of the
federal alternative minimum tax. This investment policy is a fundamental policy
of the Fund. The Fund will purchase municipal bonds, municipal notes, municipal
lease obligations, tax-exempt money market mutual funds, and tax-exempt
commercial paper rated in the two highest short-term rating categories by a
nationally recognized statistical rating organization (an "NRSRO") in
accordance with Securities and Exchange Commission ("SEC") regulations at the
time of investment or, if not rated, determined by the Adviser to be of
comparable quality.
The Adviser will not invest more than 25% of Fund assets in Municipal
Securities (a) whose issuers are located in the same state or (b) the interest
on which is derived from revenues of similar type projects. This restriction
does not apply to Municipal Securities in any of the following categories:
public housing authorities; general obligations of states and localities; state
and local housing finance authorities; or municipal utilities systems.
The Tax Exempt Fund may purchase municipal obligations with demand features,
including variable and floating rate obligations. In addition, the Fund may
invest in commitments to purchase securities on a "when issued" basis and
purchase securities subject to a standby commitment.
The Tax Exempt Fund may purchase securities on a when-issued or delayed basis
only when settlement takes place within 15 days of the purchase of such
securities.
The Tax Exempt Fund may invest up to 20% of the Fund's net assets in the
aggregate in taxable money market instruments, taxable money market mutual
funds, and securities subject to the alternative minimum tax. Taxable money
market instruments in which the Fund may invest consist of (i) bankers'
acceptances, certificates of deposits, notes and time deposits of highly-rated
U.S. banks and U.S. branches of foreign banks, (ii) U.S. Treasury obligations
and obligations issued or guaranteed by the agencies and instrumentalities of
the U.S. Government, including STRIPs; (iii) high quality commercial paper
issued by U.S. and foreign corporations; (iv) debt obligations with a maturity
of one year or less
4
<PAGE>
issued by corporations with outstanding high-quality commercial paper;
(v) receipts and (vi) repurchase agreements involving any of the foregoing
obligations entered into with highly-rated banks and broker-dealers.
The Tax Exempt Fund may engage in securities lending and may also borrow money
in amounts up to 33 1/3% of its net assets.
GENERAL INVESTMENT POLICIES
Each Fund complies with regulations of the Securities and Exchange Commission
applicable to money market funds. These regulations impose certain quality,
maturity and diversification restraints on investments by a Fund. Under these
regulations, each Fund will maintain a dollar-weighted average portfolio
maturity of 90 days or less, and will acquire only obligations with remaining
maturities of 397 days or less. Each Fund will attempt to maintain a net asset
value of $1.00 per share, although there can be no assurance that it will be
able to do so.
For additional information regarding permitted investments, investment
practices and risks, see "Description of Permitted Investments and Risk
Factors."
INVESTMENT LIMITATIONS
The following investment limitations are fundamental policies of the Funds.
Fundamental policies cannot be changed with respect to a Fund without the
consent of the holders of a majority of that Fund's outstanding shares.
A Fund may not:
1. Purchase securities of any issuer (except securities issued or guaranteed by
the United States, its agencies or instrumentalities and repurchase agreements
involving such securities) if, as a result, more than 5% of the total assets of
the Fund would be invested in the securities of such issuer. This restriction
applies to 75% of the Tax Exempt Fund's assets.
2. Purchase any securities which would cause more than 25% of the total assets
of the Fund to be invested in the securities of one or more issuers conducting
their principal business activities in the same industry, provided that this
limitation does not apply to (i) investments in the obligations issued or
guaranteed by the U.S. Government or its agencies and instrumentalities, and
repurchase agreements involving such securities; and, with respect to the Tax
Exempt Fund, (ii) tax-exempt securities issued by governments or political
subdivisions of governments.
3. Make loans except that the Fund may (i) purchase or hold debt instruments in
accordance with its investment objectives and policies; (ii) enter into
repurchase agreements; and, with respect to the Tax Exempt Fund, (iii) engage
in securities lending as described in this Prospectus and in the Statement of
Additional Information.
Additional investment limitations are set forth in the Statement of Additional
Information.
PURCHASE OF SHARES
Investors may purchase Cash Sweep Class shares of a Fund directly from the
Trust's shareholder servicing and transfer agent, DST Systems, Inc., or an
authorized sub-transfer agent (collectively, the "Transfer Agent"), by mail, by
wire, or through an automatic investment plan. Shares may also be purchased
through broker-dealers, including Marquis Investments, LLC, that have
established a dealer agreement with SEI Financial Services Company, the Trust's
distributor (the "Distributor"). Cash Sweep Class shares of the Funds are sold
on a continuous basis.
BY MAIL
You may purchase Cash Sweep Class shares of a Fund by completing and signing an
Account Application form and mailing it, along with a check (or other
negotiable bank instrument or money order) payable to "Marquis Funds (Fund
Name)," to Marquis Funds at PO Box 419316, Kansas City, MO 64141-6316. You may
purchase additional shares at any time by mailing payment to the Transfer
Agent. Orders placed by mail will be executed on receipt of your payment. If
your check does not clear, your purchase will be cancelled and you could be
liable for any losses or fees incurred.
Third party checks, credit cards, credit card checks and cash will not be
accepted. When purchases are made by check, redemption proceeds will not be
forwarded until the investment being redeemed has been in the account for
15 days.
5
<PAGE>
You may obtain Account Application forms by calling 1-800-471-1144.
BY WIRE
You may purchase Cash Sweep Class shares of a Fund by wiring Federal funds,
provided that your Account Application has been previously received. You must
wire funds to the Transfer Agent and the wire instructions must include your
account number. You must call 1-800-471-1144 before wiring any funds. An order
to purchase shares by Federal funds wire will be deemed to have been received
by the Fund on the Business Day (defined below) of the wire, provided that the
shareholder notifies the Transfer Agent prior to 12:00 noon, Central time. If
the Transfer Agent does not receive notice by 12:00 noon, Central time, on the
Business Day of the wire, the order will be executed on the next Business Day.
AUTOMATIC INVESTMENT PLAN ("AIP")
You may arrange for periodic additional investments in a Fund through automatic
deductions by Automated Clearing House ("ACH") from a checking account by
completing an AIP Application Form. The minimum pre-authorized investment
amount is $50 per month. An AIP Application Form may be obtained by calling
1-800-471-1144. The AIP is available only for additional investments for an
existing account.
GENERAL INFORMATION REGARDING PURCHASES
You may purchase Cash Sweep Class shares of a Fund on any day the New York
Stock Exchange and the Federal Reserve wire system are open for business
("Business Days").
The minimum initial investment in Cash Sweep Class shares of a Fund is $2,500
($500 minimum for individual retirement accounts and employees of First
National Bank of Commerce in New Orleans, the Funds' investment adviser (the
"Adviser") or its affiliates); however, the Distributor may waive the minimum
investment at its discretion. Subsequent purchases of shares must be at least
$100, except for purchases through the AIP and payroll deductions, which must
be at least $50.
A purchase order for shares will be effective, and eligible to receive
dividends declared that same day, on the Business Day the order is received by
the Transfer Agent if it receives the order and payment before 12:00 noon,
Central time. A purchase order received (with payment) after this time will be
effective on the next Business Day. The purchase price of Cash Sweep Class
shares of a Fund is the net asset value per share next computed after the order
is received and accepted by the Trust. Each Fund expects to maintain its net
asset value per share constant at $1.00. The net asset value per share of a
Fund is determined by dividing the total value of its investments and other
assets, less any liabilities, by its total outstanding shares. Each Fund's net
asset value per share is calculated as of 3:00 p.m., Central time, each
Business Day and is based on the amortized cost method described in the
Statement of Additional Information.
The Trust reserves the right to reject a purchase order for shares when the
Distributor determines that it is not in the best interest of the Trust and/or
its shareholders to accept such order.
Shareholders of record who desire to transfer registration of their shares
should call 1-800-471-1144.
PURCHASES THROUGH FINANCIAL INSTITUTIONS
Shares may also be purchased through financial institutions, including the
Adviser, that provide distribution assistance or shareholder services to the
Trust. Shares purchased by persons ("Customers") through financial institutions
may be held of record by the financial institution. Financial institutions may
impose an earlier cut-off time for receipt of purchase orders directed through
them to allow for processing and transmittal of these orders to the Transfer
Agent for effectiveness the same day. Customers should contact their financial
institution for information as to that institution's procedures for
transmitting purchase, exchange or redemption orders to the Trust.
Customers who desire to transfer the registration of shares beneficially owned
by them but held of record by a financial institution should contact the
6
<PAGE>
institution to accomplish the transfer. Certain financial institutions may be
required under state law to register as broker/dealers.
Depending upon the terms of a particular Customer account, a financial
institution may charge a Customer account fees. Information concerning these
services and any charges will be provided to the Customer by the financial
institution.
EXCHANGES
You may exchange your shares for Class A or Class B shares of other funds of
the Trust. You will be subject to the applicable sales charge on exchange
unless you qualify for a sales load waiver.
You must have received a current prospectus of the Trust's other fund into
which you wish to move your investment (the "new" fund) before the exchange
will be effected. Exchanges will be made only after instructions in writing or
by telephone (an "Exchange Request") are received by the Transfer Agent. If an
Exchange Request in good order is received by DST by 3:00 p.m. Central time, on
any Business Day, the exchange will occur on that day. The exchange privilege
may be exercised only in those states where the class or shares of the new fund
may legally be sold.
Customers who beneficially own shares held of record by a financial institution
should contact that institution if they wish to exchange shares. The
institution will contact the Transfer Agent and effect the exchange on behalf
of the Customer.
The Trust reserves the right to change the terms or conditions of the exchange
privilege discussed herein upon 60 days' notice.
REDEMPTION OF SHARES
You may redeem your shares without charge on any Business Day. There is,
however, a $25 charge for wiring redemption proceeds. Shares may be redeemed by
mail, by telephone or through a systematic withdrawal plan. Investors who own
shares held of record by a financial institution should contact that financial
institution for information on how to redeem shares. Shares cannot be redeemed
by Federal Reserve wire on Federal holidays restricting wire transfers.
BY MAIL
A written request for redemption must be received by the Transfer Agent in
order to constitute a valid redemption request.
If the redemption request exceeds $5,000 or if the request directs the proceeds
to be sent or wired to a shareholder or an address different from that on
record, the Transfer Agent may require that the signature on the written
redemption request be guaranteed. You should be able to obtain a signature
guarantee from a bank, broker, dealer, credit union, securities exchange or
association, clearing agency or savings association. A notary public cannot
guarantee signatures.
BY TELEPHONE
You may redeem your shares by telephone if you have elected that option on your
Account Application. Under most circumstances, payments will be transmitted on
the next Business Day following receipt of a valid request for redemption. You
may have the proceeds mailed to your address of record or wired to a commercial
bank account previously designated on your Account Application. There is no
charge for having redemption proceeds mailed to you or to a designated bank
account, but there is a charge for wiring redemption proceeds.
You may request a wire redemption for redemptions in excess of $500 by calling
1-800-471-1144, however a wire charge of $25 will be deducted from the amount
of the wire redemption.
Neither the Trust nor the Transfer Agent will be responsible for any loss,
liability, cost or expense for acting upon wire instructions or upon telephone
instructions that it reasonably believes to be genuine. The Trust and the
Transfer Agent will each employ reasonable procedures to confirm that
instructions communicated by telephone are
7
<PAGE>
genuine, including requiring a form of personal identification prior to acting
upon instructions received by telephone and recording telephone instructions.
When market conditions are extremely busy, it is possible that you may
experience difficulties placing redemption orders by telephone, and may wish to
place them by mail.
SYSTEMATIC WITHDRAWAL PLAN ("SWP")
The Trust offers a Systematic Withdrawal Plan which you may use to receive
regular distributions from your account. Upon commencement of the SWP, your
account must have a current value of $5,000 or more. You may elect to receive
automatic payments via check or ACH of $100 or more on a monthly, quarterly,
semi-annual or annual basis. You may obtain a SWP Application Form by calling
1-800-471-1144.
To participate in the SWP, you must have your dividends automatically
reinvested. You should realize that if your automatic withdrawals exceed income
dividends, your invested principal in the account will be depleted. Thus,
depending on the frequency and amounts of the withdrawal payments and/or any
fluctuations in the net asset value per share, your original investment could
be exhausted entirely. You may change or cancel the SWP at any time on written
notice to the Transfer Agent.
OTHER INFORMATION REGARDING REDEMPTIONS
All redemption orders are effected at the net asset value per share next
determined after receipt of a valid request for redemption. A redemption order
received before 11:00 a.m., Central time, on any Business Day will be effective
that day and will receive that day's redemption price. Net asset value per
share is determined as of 3:00 p.m., Central time, on each Business Day.
Redeemed shares are not entitled to dividends declared on the day the
redemption order is effective.
Payment to shareholders for shares redeemed will be made within 7 days after
the Transfer Agent receives the valid redemption request. At various times,
however, a Fund may be requested to redeem shares for which it has not yet
received good payment. When purchases are made by check, redemption proceeds
will not be forwarded until the investment being redeemed has been in the
account for fifteen days.
Due to the relatively high costs of handling small investments, each Fund
reserves the right to redeem your shares at their net asset value if, because
of redemptions, your account in that Fund has a value of less than the minimum
initial purchase amount (normally $2,500; $500 for individual retirement
accounts and for employees of the Adviser or its affiliates). Accordingly, if
you purchase shares of a Fund in only the minimum investment amount, you may be
subject to involuntary redemption if you redeem any shares. Before a Fund
exercises its right to redeem your shares, you will be given notice that the
value of the shares in your account is less than the minimum amount and will be
allowed 60 days to make an additional investment in the Fund in an amount which
will increase the value of the account to at least the minimum amount.
THE ADVISER
First National Bank of Commerce in New Orleans (the "Adviser"), 201 St. Charles
Avenue, New Orleans, Louisiana 70170, acts as each Fund's investment adviser
under an advisory agreement (the "Advisory Agreement") with the Trust. The
Adviser, through its Trust Group, makes the investment decisions for the assets
of the Funds and continuously reviews, supervises and administers the
investment programs of the Treasury Fund, subject to the supervision of, and
policies established by, the Trustees of the Trust. With respect to the Tax
Exempt Fund, the Adviser has delegated these responsibilities, subject to its
supervision, to the sub-adviser.
As of September 30, 1996, the Adviser's Trust Group managed approximately $2.3
billion in discretionary investment management accounts for individuals,
corporations and institutions with widely varying investment needs and
objectives. The Trust Group has managed client accounts since 1933 and has
managed money market portfolios for the past eight years. The Adviser is a
wholly-owned subsidiary of First Commerce Corporation.
8
<PAGE>
The Glass-Steagall Act restricts the securities activities of national banks
such as First National Bank of Commerce in New Orleans but the Comptroller of
the Currency permits national banks to provide investment advisory and other
services to mutual funds. Should the Comptroller's position be challenged
successfully in court or reversed by legislation, the Trust might have to make
other investment advisory arrangements.
The Trust's shares are not sponsored, endorsed or guaranteed by, and do not
constitute obligations or deposits of, the Adviser or First Commerce
Corporation and are not insured by the Federal Deposit Insurance Corporation or
issued or guaranteed by the U.S. Government or any of its agencies.
The Adviser is entitled to a fee, which is calculated daily and paid monthly,
at an annual rate of .30% of the Treasury Fund's average daily net assets and
0.45% of the Tax Exempt Fund's average daily net assets. The Adviser may
voluntarily waive a portion of its fee in order to limit the total operating
expenses of the Funds. The Adviser reserves the right, in its sole discretion,
to terminate these voluntary fee waivers at any time. For the fiscal year ended
September 30, 1996, the Adviser was paid an advisory fee of .27% of the
Treasury Fund's average net assets and .26% of the Tax Exempt Fund's average
net assets.
Gerald S. Dugal, Vice President of the Adviser, is the portfolio manager of the
Treasury Securities Money Market Fund, Institutional Money Market Fund,
Strategic Income Bond Fund and Tax Exempt Money Market Fund. Mr. Dugal is
currently a senior portfolio manager and Manager of Fixed Income and Trading.
Mr. Dugal has over 11 years of experience in portfolio management, investment
trading and research, the past six with the Adviser. He is licensed as a
general securities principal and a municipal securities principal.
THE SUB-ADVISER
Weiss, Peck & Greer, L.L.C. ("WPG") serves as the Tax Exempt Fund's investment
sub-adviser under a sub-advisory agreement (the "Sub-Advisory Agreement") with
the Adviser. Under the Sub-Advisory Agreement, WPG invests the assets of the
Fund on a daily basis, and continuously administers the investment program of
the Fund.
WPG is a limited liability company founded as a limited partnership in 1970,
and engages in investment management, venture capital management and management
buyouts. Since its founding, WPG has been active in managing portfolios of tax
exempt securities. Currently, WPG manages over $12 billion in assets, $2
billion of which is invested in tax exempt money market funds. The principal
business address of WPG is One New York Plaza, New York, N.Y. 10004.
WPG is entitled to a fee which is paid by the Adviser and which is calculated
daily and paid monthly, at an annual rate of: .075% of the Tax Exempt Fund's
average daily net assets up to $150 million; .05% of the next $350 million of
the Fund's average daily net assets, .04% of the next $500 million in average
daily net assets; and .01% of the Fund's average daily net assets over $1
billion.
For the fiscal period ended September 30, 1996, WPG was paid a sub-advisory fee
of .075% (annualized) of the Tax Exempt Fund's average daily net assets.
THE ADMINISTRATOR
SEI Fund Resources, a Delaware business trust (the "Administrator"), has its
principal business offices at Oaks, Pennsylvania 19456. The Trust and the
Administrator are parties to an Administration Agreement (the "Administration
Agreement"). Under the terms of the Administration Agreement, the Administrator
provides the Trust with administrative services, other than investment advisory
services, including all regulatory reporting, necessary office space,
equipment, personnel and facilities.
The Administrator is entitled to a fee, which is calculated daily and paid
monthly, at an annual rate of .15% of each Fund's average daily net assets.
9
<PAGE>
The Administrator reserves the right to terminate any waivers or reimbursements
at any time at its sole discretion.
THE SHAREHOLDER SERVICING AGENT AND TRANSFER AGENT
DST Systems, Inc., 1004 Baltimore Street, Kansas City, MO 64105, serves as the
dividend disbursing agent and shareholder servicing agent for the Trust. DST
also acts as transfer agent for the Trust under a transfer agent agreement.
THE DISTRIBUTOR
The Cash Sweep Class shares of the Funds have a Rule 12b-1 distribution plan
(the "Cash Sweep Class Plan"), and the Trust and SEI Financial Services Company
(the "Distributor"), Oaks, Pennsylvania 19456, a wholly-owned subsidiary of SEI
Investments Company, have entered into a distribution agreement (the
"Distribution Agreement").
As provided in the Distribution Agreement and the Cash Sweep Class Plan, the
Trust pays the Distributor a fee at the annual rate of .50% and .60% of the
average daily net assets of the Cash Sweep Class shares of the Treasury Fund
and Tax Exempt Fund, respectively. This fee will be calculated and paid each
month based on average daily net assets for that month. The Distributor from
time to time may waive a portion of this distribution fee in order to limit the
distribution fee for Cash Sweep Class shares of the Funds. The Distributor
reserves the right in its sole discretion to terminate this voluntary waiver at
any time.
The Distributor may use such fees to make payments to financial institutions
and intermediaries such as banks (including the Adviser and its affiliates),
savings and loan associations, insurance companies, and investment counselors,
broker-dealers, and the Distributor's affiliates (collectively, "financial
intermediaries") as compensation for shareholder services or as compensation to
the Distributor for its services. The Cash Sweep Class Plan is characterized as
a compensation plan since this fee will be paid to the Distributor without
regard to the shareholder service expenses incurred by the Distributor or the
amount of payments made to financial intermediaries. If the Distributor's
expenses are less than its fees, the Trust will still pay the full fee and the
Distributor will realize a profit, but the Trust will not be obligated to pay
in excess of the full fee, even if the Distributor's actual expenses are
higher. The Distributor has agreed, however, to pay the entire amount of the
fee to financial intermediaries for shareholder services.
The Funds may also execute brokerage or other agency transactions through an
affiliate of the Adviser or through the Distributor, for which the affiliate or
the Distributor may receive "usual and customary" compensation. For further
information, see the Statement of Additional Information.
PERFORMANCE
From time to time, the Trust may advertise each Fund's "current yield" and
"effective compound yield." These figures will fluctuate, as they are based on
historical earnings; they are not intended to indicate future performance and
the Trust makes no representation concerning actual future yields. The "current
yield" of a Fund refers to the income generated by an investment over a seven-
day period which is then "annualized." That is, the amount of income generated
by an investment during that week is assumed to be generated each week over a
52-week period and is shown as a percentage of the investment. The "effective
yield" is calculated similarly but, when annualized, the income earned by an
investment is assumed to be reinvested. The "effective yield" will be slightly
higher than the "current yield" because of the compounding effect of this
assumed reinvestment.
The Tax Exempt Fund may also advertise a "tax-equivalent yield," which is
calculated by determining the rate of return that would have to be achieved on
a fully taxable investment to produce the after-tax equivalent of this Fund's
yield, assuming certain tax brackets for the shareholder.
In addition, the Trust may from time to time compare performance of a Fund to
that of other mutual funds tracked by mutual fund rating
10
<PAGE>
services, financial and business publications and periodicals, broad groups of
comparable mutual funds or unmanaged indices which may assume investment of
dividends but generally do not reflect deductions for administrative and
management costs or to other investment alternatives.
The performance of the various classes of shares of a Fund will differ because
of the distribution fees charged to the Cash Sweep Class and Retail Class
shares.
TAXES
The following summary of federal income tax consequences is based on current
tax laws and regulations, which may be changed by legislative, judicial or
administrative action.
No attempt has been made to present a detailed explanation of the federal,
state, or local income tax treatment of the Funds or its shareholders. In
addition, state and local tax consequences of an investment in a Fund may
differ from the federal income tax consequences described below. Accordingly,
shareholders are urged to consult with their tax advisers regarding specific
questions as to federal, state and local income taxes. Additional information
concerning taxes is set forth in the Statement of Additional Information.
TAX STATUS OF THE FUNDS
Each Fund is treated as a separate entity for federal income tax purposes and
is not combined with the Trust's other funds. Each Fund intends to qualify for
the special tax treatment afforded regulated investment companies as defined
under Subchapter M of the Internal Revenue Code of 1986, as amended, so as to
be relieved of federal income tax, net of investment company taxable income,
and net of capital gain (the excess of net long-term capital gains over net
short-term capital losses) distributed to shareholders.
TAX STATUS OF DISTRIBUTIONS
Each Fund will distribute all of its net investment income (including net
short-term capital gains) to shareholders. Dividends from net investment
company taxable income are taxable to shareholders as ordinary income (whether
received in cash or in additional shares) to the extent of a Fund's earnings
and profits. Any net realized capital gain will be distributed at least
annually and will be taxed to shareholders as long-term capital gain,
regardless of how long the shareholders have held their shares and regardless
of whether the distributions are received in cash or in additional shares.
Dividends and distribution of capital gains paid by a Fund do not qualify for
the dividends received deduction for corporate shareholders. Each Fund will
make annual reports to shareholders of the federal income tax status of all
distributions.
If, at the close of each quarter of its taxable year, at least 50% of the value
of the Tax Exempt Fund's assets consist of obligations the interest on which is
excludable from gross income for federal tax purposes, that Fund may pay
"exempt-interest dividends" to its shareholders. Those dividends constitute the
portion of the aggregate dividends as designated by the Fund equal to the
excess of the excludable interest over certain amounts disallowed as
deductions. Exempt-interest dividends are excludable from a shareholder's gross
income for regular federal income tax purposes, but may have certain collateral
federal income tax consequences, including alternative minimum tax. See the
Statement of Additional Information.
Current federal law limits the types and volume of bonds qualifying for the
federal income tax exemption of interest, which may have an effect on the
ability of the Tax Exempt Fund to purchase sufficient amounts of tax-exempt
securities to satisfy the Code's requirements for the payment of "exempt-
interest dividends."
Dividends declared by a Fund in October, November or December of any year and
payable to shareholders of record on a date in one of those months will be
deemed to have been paid by the Fund and received by the shareholders on
December 31 of the year declared paid by the Fund at any time during the
following January.
11
<PAGE>
With respect to investments in U.S. Treasury STRIPS, which are sold with
original issue discount and do not make periodic cash interest payments, a Fund
will be required to include as part of its current income the imputed interest
on such obligations even though the Fund has not received any interest payments
on such obligations during that period. Because each Fund distributes all of
its net investment income to its shareholders, a Fund may have to sell
portfolio securities to distribute such imputed income, which may occur at a
time when the Adviser would not have chosen to sell such securities and which
may result in a taxable gain or loss.
Investment income received directly by a Fund on direct U.S. Government
obligations is exempt from income tax at the state level when received directly
and may be exempt, depending on the state, when received by a shareholder as
income dividends provided certain state specific conditions are satisfied.
Interest received on repurchase agreements collateralized by direct U.S.
Government obligations normally is not exempt from state taxation. Each Fund
will inform shareholders annually of the percentage of income and distributions
derived from direct U.S. Government obligations. Shareholders should consult
their tax advisers to determine whether any portion of the income dividends
received from a Fund is considered tax exempt in their particular states.
Each Fund intends to make sufficient distributions prior to the end of each
calendar year to avoid liability for federal excise tax applicable to regulated
investment companies.
A sale, exchange or redemption of a Fund's shares generally is a taxable
transaction to the shareholder.
GENERAL INFORMATION
THE TRUST
The Trust was organized as a Massachusetts business trust under a Declaration
of Trust dated June 29, 1993. The Declaration of Trust permits the Trust to
offer separate series of shares or "funds" and different classes of each fund.
In addition to the Funds, the Trust offers the following funds: Institutional
Money Market Fund, Government Securities Fund, Louisiana Tax-Free Income Fund,
Strategic Income Bond Fund, Balanced Fund, Value Equity Fund, Growth Equity
Fund, Small Cap Equity Fund and International Equity Fund. All consideration
received by the Trust for shares of any fund and all assets of such fund belong
to that fund and would be subject to liabilities related thereto. The Trust
reserves the right to create and issue shares of additional funds.
The Trust pays its operating expenses, including fees of its service providers,
audit and legal expenses, expenses of preparing prospectuses, proxy
solicitation material and reports to shareholders, costs of custodial services
and registering the shares under federal and state securities laws, pricing and
insurance expenses, and pays additional expenses including litigation and other
extraordinary expenses, brokerage costs, interest charges, taxes and
organization expenses.
TRUSTEES OF THE TRUST
The management and affairs of the Trust are supervised by the Trustees under
the laws of the Commonwealth of Massachusetts. The Trustees have approved
contracts under which, as described above, certain companies provide essential
management, administrative and shareholder services to the Trust.
VOTING RIGHTS
Each share held entitles the shareholder of record to one vote. Each fund or
class will vote separately on matters relating solely to that fund or class. As
a Massachusetts business trust, the Trust is not required to hold annual
meetings of shareholders but meetings of shareholders will be held from time to
time to seek approval for certain changes in the operation of the Trust and for
the election of Trustees under certain circumstances. In addition, a Trustee
may be removed by the remaining Trustees or by shareholders at a special
meeting called upon written request of shareholders owning at least 10% of the
outstanding shares of the Trust. In the event that such a meeting is requested,
the
12
<PAGE>
Trust will provide appropriate assistance and information to the shareholders
requesting the meeting.
REPORTING
The Trust issues unaudited financial information semiannually and audited
financial statements annually. The Trust furnishes periodic reports to
shareholders of record, and, as necessary, proxy statements for shareholder
meetings.
SHAREHOLDER INQUIRIES
Shareholder inquiries should be directed to Marquis Funds, P.O. Box 419316,
Kansas City, MO 64141-6316 or by calling 1-800-471-1144.
DIVIDENDS
The net investment income (not including capital gains) of a Fund is determined
and declared on each Business Day as a dividend for shareholders of record as
of the close of business on that day. Shareholders who own shares at the close
of business on the record date will be entitled to receive the dividend.
Currently, capital gains of each Fund, if any, will be distributed at least
annually. Dividends are paid by the Funds in Federal funds or in additional
shares at the discretion of the shareholder on the first business day of each
month.
COUNSEL AND INDEPENDENT PUBLIC ACCOUNTANTS
Morgan, Lewis & Bockius LLP serves as counsel to the Trust. Arthur Andersen LLP
serves as the independent public accountants of the Trust.
CUSTODIAN
First National Bank of Commerce in New Orleans acts as Custodian of the Trust.
The Custodian holds cash, securities and other assets of the Trust as required
by the Investment Company Act of 1940, as amended (the "1940 Act").
DESCRIPTION OF PERMITTED INVESTMENTS AND RISK FACTORS
The following is a description of the permitted investments and investment
practices for the Funds and associated risk factors. The only permitted
investments for the Treasury Fund include Repurchase Agreements and U.S.
Treasury obligations. Further discussion is contained in the Statement of
Additional Information.
BANKERS' ACCEPTANCES--Bankers' acceptances are bills of exchange or time drafts
drawn on and accepted by a commercial bank. Bankers' acceptances are used by
corporations to finance the shipment and storage of goods and to furnish dollar
exchange. Maturities are generally six months or less.
CERTIFICATES OF DEPOSIT--Certificates of deposit are interest bearing
instruments with a specific short-term maturity. They are issued by banks and
savings and loan institutions in exchange for the deposit of funds and normally
can be traded in the secondary market prior to maturity. Certificates of
deposit with penalties for early withdrawal will be considered illiquid.
COMMERCIAL PAPER--Commercial paper is a term used to describe unsecured short-
term promissory notes issued by corporations and other entities. Maturities on
these issues vary from a few to 270 days.
FIXED INCOME SECURITIES--Fixed income securities include bonds, notes,
debentures and other interest-bearing securities that represent indebtedness.
The market value of the fixed income investments in which the Funds invest will
change in response to interest rate changes and other factors. During periods
of falling interest rates, the values of outstanding fixed income securities
generally rise. Conversely, during periods of rising interest rates, the values
of such securities generally decline. Moreover, while securities with longer
maturities tend to produce higher yields, the prices of longer maturity
securities are also subject to greater market fluctuations as a result of
changes in interest rates.
13
<PAGE>
Changes by recognized agencies in the rating of any fixed income security and
in the ability of an issuer to make payments of interest and principal also
affect the value of these investments. Changes in the value of these securities
will not necessarily affect cash income derived from these securities but will
affect a Fund's net asset value.
MUNICIPAL LEASES--Municipal leases are obligations issued by state and local
governments or authorities to finance the acquisition of equipment and
facilities and may be considered to be illiquid. They may take the form of a
lease, an installment purchase contract, a conditional sales contract, or a
participation certificate in any of the above.
Municipal lease obligations typically are not backed by the municipality's
credit, and their interest may become taxable if the lease is assigned. If
funds are not appropriated for the following year's lease payments, a lease may
terminate, with a possibility of default on the lease obligation and
significant loss to the Fund. Under guidelines established by the Board of
Trustees, the credit quality of municipal leases will be determined on an
ongoing basis, including an assessment of the likelihood that a lease will be
canceled.
MUNICIPAL SECURITIES--Municipal securities consist of (i) debt obligations
issued by or on behalf of public authorities to obtain funds to be used for
various public facilities, for refunding outstanding obligations, for general
operating expenses, and for lending such funds to other public institutions and
facilities, and (ii) 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. 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; tolls from a toll bridge for example. Certificates of participation
represent an interest in an underlying obligation or commitment such as an
obligation issued in connection with a leasing arrangement. 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 so
financed as security for such payment.
Municipal securities 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.
PARTICIPATION INTERESTS--Participation interests are interests in Municipal
Securities from financial institutions such as commercial and investment banks,
savings and loan associations and insurance companies. These interests may take
the form of participations, beneficial interests in a trust, partnership
interests or any other form of indirect ownership that allows a Fund to treat
the income from the investment as exempt from federal income tax. The Tax
Exempt Fund invests in these participation interests in order to obtain credit
enhancement or demand features that would not be available through direct
ownership of the underlying Municipal Securities.
RECEIPTS--TRs, TIGRs and CATS--interests in separately traded interest and
principal component parts of U.S. Treasury obligations that are issued by banks
or brokerage firms and are created by depositing U.S. Treasury obligations into
a special account at a custodian bank. The custodian holds the interest and
principal payments for the benefit of the registered owners of the certificates
or receipts. The custodian arranges for the issuance of the certificates or
receipts evidencing ownership and maintains the register. Receipts are sold as
zero coupon securities which means that they are sold at a substantial discount
and redeemed at face value at their maturity date without interim cash payments
of interest or principal. The amount of this discount is accrued over the life
of the security and constitutes the income earned on the security for both
accounting and tax purposes. Because of these features, receipts may be subject
to greater price volatility than interest
14
<PAGE>
paying U.S. Treasury Obligations. Receipts include Treasury Receipts ("TRs"),
Treasury Investment Growth Receipts ("TIGRs"), and Certificates of Accrual on
Treasury Securities ("CATS").
REPURCHASE AGREEMENTS--Repurchase agreements are agreements by which a Fund
obtains a security and simultaneously commits to return 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. Repurchase
agreements must be fully collateralized at all times. 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. A Fund will
enter into repurchase agreements only with financial institutions deemed to
present minimal risk of bankruptcy during the term of the agreement based on
established guidelines. Repurchase agreements are considered loans under the
1940 Act, as amended.
SECURITIES LENDING--In order to generate additional income, the Tax Exempt Fund
may lend securities which it owns pursuant to agreements requiring that the
loan be continuously secured by collateral consisting of cash or securities of
the U.S. Government or its agencies equal to at least 100% of the market value
of the securities lent. The Fund continues to receive interest on the
securities lent while simultaneously earning a portion of the return generated
from the collateral (or a portion of the return on the investment of cash
collateral). Collateral is marked to market daily. There may be risks of delay
in recovery of the securities or even loss of rights in the collateral should
the borrower of the securities fail financially or become insolvent.
STANDBY COMMITMENTS--Some securities dealers are willing to sell Municipal
Securities to a Fund accompanied by their commitments to repurchase the
Municipal Securities prior to maturity, at the Fund's option, for the amortized
cost of the Municipal Securities at the time of repurchase. These arrangements
are not used to protect against changes in the market value of Municipal
Securities. They permit a Fund, however, to remain fully invested and still
provide liquidity to satisfy redemptions. The cost of Municipal Securities
accompanied by these "standby" commitments could be greater than the cost of
Municipal Securities without such commitments. Standby commitments are not
marketable or otherwise assignable and have value only to a Fund. The default
or bankruptcy of a securities dealer giving such a commitment would not affect
the quality of the Municipal Securities purchased. However, without a standby
commitment, these securities could be more difficult to sell. The Tax Exempt
Fund enters into standby commitments only with those dealers whose credit the
investment adviser believes to be of high quality.
TIME DEPOSITS--Time deposits are non-negotiable receipts issued by a bank in
exchange for the deposit of funds. Like a certificate of deposit, it earns a
specified rate of interest over a definite period of time; however, it cannot
be traded in the secondary market. Time deposits may be considered to be
illiquid securities.
U.S. GOVERNMENT AGENCY OBLIGATIONS--Obligations issued or guaranteed by
agencies of the United States Government, including, among others, the Federal
Farm Credit Bank, the Federal Housing Administration and the Small Business
Administration, and obligations issued or guaranteed by instrumentalities of
the United States Government, including, among others, the Federal Home Loan
Mortgage Corporation, the Federal Land Banks and the United States Postal
Service. Some of these securities are supported by the full faith and credit of
the United States Treasury (e.g., Government National Mortgage Association
securities), others are supported by the right of the issuer to borrow from the
Treasury (e.g., Federal Farm Credit Bank securities), while still others are
supported only by the credit of the instrumentality (e.g., Federal National
Mortgage Association securities). Guarantees of principal by agencies or
instrumentalities of the United States Government may be a guarantee of payment
at the maturity of the obligation so that in the event of a default prior to
maturity there might not be a market and thus no means of realizing on the
obligation prior to maturity. Guarantees as to the timely payment of principal
and interest do not
15
<PAGE>
extend to the value or yield of these securities nor to the value of the Tax
Exempt Fund's shares.
U.S. GOVERNMENT SECURITIES--Any guaranty by the U.S. Government of the
securities in which a Fund invests guarantees only the payment of principal and
interest on the guaranteed security and does not guarantee the yield or value
of that security or the yield or value of shares of the Fund.
U.S. TREASURY OBLIGATIONS--U.S. Treasury obligations consist of bills, notes,
and bonds issued by the U.S. Treasury, and separately traded interest and
principal component parts of such obligations that are transferable through the
Federal book-entry system known as Separately Traded Registered Interest and
Principal Securities ("STRIPS"). The Funds do not expect to trade STRIPS
actively.
VARIABLE AND FLOATING RATE INSTRUMENTS--Certain of the obligations purchased by
the Tax Exempt Fund may carry variable or floating rates of interest, may
involve a conditional or unconditional demand feature and 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.
The interest rates on these securities may be reset daily, weekly, quarterly or
some other reset period, and may have a floor or ceiling on interest rate
changes. There is a risk that the current interest rate on such obligations may
not accurately reflect existing market interest rates. A demand instrument with
a demand notice exceeding seven days may be considered illiquid if there is no
secondary market for such securities.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES--When-issued or delayed delivery
basis transactions involve the purchase of an instrument with payment and
delivery taking place in the future. Delivery of and payment for these
securities may occur a month or more after the date of the purchase commitment.
However, the Tax Exempt Fund may purchase securities on a when-issued or
delayed basis only when settlement takes place within 15 days of the purchase
of such securities. To the extent required by the 1940 Act, the Tax Exempt Fund
will maintain with the custodian a separate account with liquid high grade debt
securities or cash in an amount at least equal to these commitments. The
interest rate realized on these securities is fixed as of the purchase date and
no interest accrues to the Fund before settlement. These securities are subject
to market fluctuation due to changes in market interest rates and it is
possible that the market value at the time of settlement could be higher or
lower than the purchase price if the general level of interest rates has
changed. Although the Tax Exempt Fund generally purchases securities on a when-
issued or forward commitment basis with the intention of actually acquiring
securities for its portfolio, the Fund may dispose of a when-issued security or
forward commitment prior to settlement if it deems appropriate.
16
<PAGE>
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Summary............................... 2
Expense Summary....................... 3
The Trust............................. 4
Investment Objective and Policies for
the Treasury Fund.................... 4
Investment Objective and Policies for
the Tax Exempt Fund.................. 4
General Investment Policies........... 5
Investment Limitations................ 5
Purchase of Shares.................... 5
Exchanges............................. 7
<CAPTION>
<S> <C>
Redemption of Shares.................. 7
The Adviser........................... 8
The Sub-Adviser....................... 9
The Administrator..................... 9
The Shareholder Servicing Agent and
Transfer Agent....................... 10
The Distributor....................... 10
Performance........................... 10
Taxes................................. 11
General Information................... 12
Description of Permitted Investments
and Risk Factors..................... 13
</TABLE>
<PAGE>
MARQUIS(SM)
FAMILY OF FUNDS
- --------------------------------------------------------------------------------
INVESTMENT ADVISER
First National Bank of Commerce in New Orleans
201 St. Charles Avenue
New Orleans, LA 70170
ADMINISTRATOR
SEI Fund Resources
Oaks, PA 19456
DISTRIBUTOR
SEI Financial Services Company
Oaks, PA 19456
TRANSFER AGENT
DST Systems, Inc.
1004 Baltimore Street
Kansas City, MO 64105
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
2000 One Logan Square
Philadelphia, PA 19103
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP
1601 Market Street
Philadelphia, PA 19103
- --------------------------------------------------------------------------------
--------------------------------------------------
Marquis Family of Funds
Not FDIC Insured
No Bank Guarantee
May Lose Value
--------------------------------------------------
No person has been authorized to give any information or to make any
representations not contained in this Prospectus, or the Statement of Additional
Information incorporated herein by reference, in connection with the offering
made by this Prospectus and, if given or made, such information or
representations must not be relied upon as having been authorized by the Trust
or by its Distributor. This Prospectus does not constitute an offering by the
Trust or by the Distributor in any jurisdiction in which such offering may not
lawfully be made.
