QUALIVEST FUNDS, 485APOS, 1996-01-26

QUALIVEST FUNDS
485APOS, 1996-01-26

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As filed with the Securities and Exchange Commission on January 26, 1996

File No. 33-79194

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X/
Post-Effective Amendment No. 7 / X/

and

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / X/
Amendment No. 9 / X/

QUALIVEST FUNDS
---------------------------------------------
(Exact Name of Registrant as Specified in Charter)

3435 Stelzer Road, Columbus, Ohio 43219-3035
--------------------------------------------
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including area code: 1-800-743-8637

Jeffrey L. Steele, Esq.
Dechert Price & Rhoads
1500 K Street, N.W.
Washington, D.C. 20005

Copies to:

George R. Landreth Robert Tuch, Esq.
BISYS Fund Services BISYS Fund Services
3435 Stelzer Road 3435 Stelzer Road
Columbus, Ohio 43219-3035 Columbus, Ohio 43219-3035

It is proposed that this filing will become effective (check appropriate box)

immediately upon filing pursuant to paragraph (b)
-----
on (date) pursuant to paragraph (b)
-----
60 days after filing pursuant to paragraph (a)
-----
x on April 10, 1996 pursuant to paragraph (a)(2) of Rule 485
-----

CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933
----------------------------------------------------------------

* Registrant has registered an indefinite number of shares of beneficial
interest under the Securities Act of 1933 pursuant to Rule 24f-2 under the
Investment Company Act of 1940. Registrant filed the notice required by
Rule 24f-2 with respect to its fiscal year ended July 31, 1995 on September
27, 1995, and Registrant intends to file the notice required by Rule 24f-2
with respect to its fiscal year ending July 31, 1996 on or before September
29, 1996.

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST LARGE COMPANIES VALUE FUND
QUALIVEST SMALL COMPANIES VALUE FUND
QUALIVEST INTERNATIONAL OPPORTUNITIES FUND
QUALIVEST OPTIMIZED STOCK FUND
QUALIVEST INTERMEDIATE BOND FUND
QUALIVEST DIVERSIFIED BOND FUND
QUALIVEST U.S. TREASURY MONEY MARKET FUND
QUALIVEST MONEY MARKET FUND
QUALIVEST TAX-FREE MONEY MARKET FUND

Form N-1A Part A Item Prospectus Caption
- --------------------- ------------------

1. Cover page.................. Cover Page

2. Synopsis.................... Prospectus Summary; Fund Expenses;
Fee Tables

3. Condensed Financial
Information................. Selected Financial Information

4. General Description of
Registrant.................. Investment Objectives and Policies;
Investment Techniques and Risk
Factors; General Information

5. Management of the Fund...... Management of the Funds

5A. Management's Discussion of
Fund Performance............ Inapplicable

6. Capital Stock and Other
Securities.................. Dividends and Taxes; General
Information

7. Purchase of Securities
Being Offered............... Valuation of Shares; Purchasing
Shares; Sales Charges on the Equity
and Income Funds; Distribution
Plans

8. Redemption or Repurchase.... Redeeming Shares

9. Pending Legal Proceedings... Inapplicable

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST LARGE COMPANIES GROWTH FUND
QUALIVEST MICRO CAP VALUE FUND

Form N-1A Part A Item Prospectus Caption
- --------------------- ------------------

1. Cover page.................. Cover Page

2. Synopsis.................... Prospectus Summary; Fund Expenses;
Fee Table

3. Condensed Financial
Information................. Inapplicable

4. General Description of
Registrant.................. Investment Objectives and Policies;
Investment Techniques and Risk
Factors; General Information

5. Management of the Fund...... Management of the Funds

5A. Management's Discussion of
Fund Performance............ Inapplicable

6. Capital Stock and Other
Securities.................. Dividends and Taxes; General
Information

7. Purchase of Securities
Being Offered............... Valuation of Shares; Purchasing
Shares; Sales Charges; Distribution
Plans

8. Redemption or Repurchase.... Redeeming Shares

9. Pending Legal Proceedings... Inapplicable

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST CONSERVATIVE FUND
QUALIVEST BALANCED FUND
QUALIVEST GROWTH FUND
QUALIVEST AGGRESSIVE GROWTH FUND

Form N-1A Part A Item Prospectus Caption
- --------------------- ------------------

1. Cover page.................. Cover Page

2. Synopsis.................... Prospectus Summary; Fund Expenses;
Fee Tables

3. Condensed Financial
Information................. Inapplicable

4. General Description of
Registrant.................. Investment Objectives and Policies;
Investment Objectives and Poli-
cies -- Underlying Funds;
Underlying Funds' Investment
Techniques and Risk Factors;
General Information

5. Management of the Fund...... Management of the Funds

5A. Management's Discussion of
Fund Performance............ Inapplicable

6. Capital Stock and Other
Securities.................. Dividends and Taxes; General
Information

7. Purchase of Securities
Being Offered............... Valuation of Shares; Purchasing
Shares; Sales Charges; Distribution
Plans

8. Redemption or Repurchase.... Redeeming Shares

9. Pending Legal Proceedings... Inapplicable

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST U.S. TREASURY MONEY MARKET FUND
QUALIVEST MONEY MARKET FUND
QUALIVEST TAX-FREE MONEY MARKET FUND

Form N-1A Part A Item Prospectus Caption
- --------------------- ------------------

1. Cover page.................. Cover Page

2. Synopsis.................... Prospectus Summary; Fund Expenses;
Fee Table

3. Condensed Financial
Information................. Selected Financial Information

4. General Description of
Registrant.................. Investment Objectives and Policies;
Investment Techniques and Risk
Factors; General Information

5. Management of the Fund...... Management of the Funds

5A. Management's Discussion of
Fund Performance............ Inapplicable

6. Capital Stock and Other
Securities.................. Dividends and Taxes; General
Information

7. Purchase of Securities
Being Offered............... Valuation of Shares; Purchasing
Shares; Distribution Plan

8. Redemption or Repurchase.... Redeeming Shares

9. Pending Legal Proceedings... Inapplicable

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST LARGE COMPANIES VALUE FUND
QUALIVEST SMALL COMPANIES VALUE FUND
QUALIVEST INCOME EQUITY VALUE FUND
QUALIVEST INTERNATIONAL OPPORTUNITIES FUND
QUALIVEST OPTIMIZED STOCK FUND
QUALIVEST INTERMEDIATE BOND FUND
QUALIVEST DIVERSIFIED BOND FUND
QUALIVEST TAX-FREE NATIONAL BOND FUND
QUALIVEST U.S. TREASURY MONEY MARKET FUND
QUALIVEST MONEY MARKET FUND
QUALIVEST TAX-FREE MONEY MARKET FUND

Form N-1A Part A Item Prospectus Caption
- --------------------- ------------------

1. Cover page.................. Cover Page

2. Synopsis.................... Prospectus Summary; Fund Expenses;
Fee Tables

3. Condensed Financial
Information................. Selected Financial Information

4. General Description of
Registrant.................. Investment Objectives and Policies;
Investment Techniques and Risk
Factors; General Information

5. Management of the Fund...... Management of the Funds

5A. Management's Discussion of
Fund Performance............ Inapplicable

6. Capital Stock and Other
Securities.................. Dividends and Taxes; General
Information

7. Purchase of Securities
Being Offered............... Valuation of Shares; Purchasing
Shares

8. Redemption or Repurchase.... Redeeming Shares

9. Pending Legal Proceedings... Inapplicable

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST LARGE COMPANIES GROWTH FUND
QUALIVEST MICRO CAP VALUE FUND

Form N-1A Part A Item Prospectus Caption
- --------------------- ------------------

1. Cover page.................. Cover Page

2. Synopsis.................... Prospectus Summary; Fund Expenses;
Fee Table

3. Condensed Financial
Information................. Inapplicable

4. General Description of
Registrant.................. Investment Objectives and Policies;
Investment Techniques and Risk
Factors; General Information

5. Management of the Fund...... Management of the Funds

5A. Management's Discussion of
Fund Performance............ Inapplicable

6. Capital Stock and Other
Securities.................. Dividends and Taxes; General
Information

7. Purchase of Securities
Being Offered............... Valuation of Shares; Purchasing
Shares

8. Redemption or Repurchase.... Redeeming Shares

9. Pending Legal Proceedings... Inapplicable

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST CONSERVATIVE FUND
QUALIVEST BALANCED FUND
QUALIVEST GROWTH FUND
QUALIVEST AGGRESSIVE GROWTH FUND

Form N-1A Part A Item Prospectus Caption
- --------------------- ------------------

1. Cover page.................. Cover Page

2. Synopsis.................... Prospectus Summary; Fund Expenses;
Fee Tables

3. Condensed Financial
Information................. Inapplicable

5. Management of the Fund...... Management of the Funds

5A. Management's Discussion of
Fund Performance............ Inapplicable

6. Capital Stock and Other
Securities.................. Dividends and Taxes; General
Information

7. Purchase of Securities
Being Offered............... Valuation of Shares; Purchasing
Shares

8. Redemption or Repurchase.... Redeeming Shares

9. Pending Legal Proceedings... Inapplicable

<PAGE>

QUALIVEST FUNDS
CROSS REFERENCE SHEET

Required by Rule 404
under the Securities Act of 1933

QUALIVEST LARGE COMPANIES VALUE FUND
QUALIVEST LARGE COMPANIES GROWTH FUND
QUALIVEST SMALL COMPANIES VALUE FUND
QUALIVEST MICRO CAP VALUE FUND
QUALIVEST INCOME EQUITY VALUE FUND
QUALIVEST INTERNATIONAL OPPORTUNITIES FUND
QUALIVEST OPTIMIZED STOCK FUND
QUALIVEST INTERMEDIATE BOND FUND
QUALIVEST DIVERSIFIED BOND FUND
QUALIVEST TAX-FREE NATIONAL BOND FUND
QUALIVEST U.S. TREASURY MONEY MARKET FUND
QUALIVEST MONEY MARKET FUND
QUALIVEST TAX-FREE MONEY MARKET FUND
QUALIVEST CONSERVATIVE FUND
QUALIVEST BALANCED FUND
QUALIVEST GROWTH FUND
QUALIVEST AGGRESSIVE GROWTH FUND

Statement of Additional
Form N-1A Part B Item Information Caption
- --------------------- -----------------------

10. Cover Page.................. Cover Page

11. Table of Contents.......... Table of Contents

12. General Information and
History..................... Inapplicable

13. Investment Objectives and
Policies.................... Investment Policies

14. Management of the Fund...... Management of the Trust - Trustees
and Officers

15. Control Persons and Principal
Holders of Securities....... Additional Information - Principal
Shareholders

16. Investment Advisory and Other

<PAGE>

Services.................... Management of the Trust -
Investment Adviser; Management of
the Trust - Distributor; Management
of the Trust - Custodians, Transfer
Agent and Fund Accounting Services;
Management of the Trust - Auditors

17. Brokerage Allocation........ Management of the Trust - Portfolio
Transactions

18. Capital Stock and Other
Securities.................. Additional Information -
Description of Shares

19. Purchase, Redemption and
Pricing of Securities
Being Offered............... Additional Purchase and Redemption
Information

20. Tax Status.................. Additional Information - Additional
Tax Information

21. Underwriters................ Management of the Trust -
Distributor

22. Calculation of Performance
Data........................ Additional Information - Yields of
the Money Funds; Additional
Information - Yields of the Parent
Funds, the Equity Funds and the
Income Funds

23. Financial Statements........ Additional Information - Financial
Statements

<PAGE>

THE QUALIVEST FUNDS:

INVESTMENT EXPERTISE WITH A LOCAL PERSPECTIVE

The Qualivest Funds are designed to provide investors with the
best of both worlds: nationally recognized investment management
expertise combined with a local perspective. While Qualivest's
portfolio managers have access to Wall Street using today's
technology, they also have unique insight into the companies and
businesses in which they invest.

Constant review of broad investment trends and detailed company
research allows Qualivest's portfolio managers to uncover value
that others may overlook . . . or be too far away to notice. Let
the Qualivest Funds' unique combination of institutional size
and strength and local management perspective guide your mutual
fund investments.

QUALIVEST CAPITAL MANAGEMENT, INC.:

THE PEOPLE BEHIND THE PERFORMANCE

The Qualivest Funds are managed by Qualivest Capital Management,
Inc., a subsidiary of U.S. Bancorp, head quartered in the
Pacific Northwest. During the last decade, Qualivest Capital
Management, Inc. has quietly grown into a regional powerhouse
with $6.5 billion under management, by developing solid
investment strategies for individual and institutional investors
like you.

Enhancing the value of assets is Qualivest's only business.
Whether you are investing in a 401(k) plan, a 403(b) plan, an
IRA account or a regular mutual fund account, Qualivest Capital
Management, Inc. and the Qualivest Funds are a smart choice. Let
Qualivest's savvy investment advice and strong investment
discipline help you reach your goals.

<PAGE>

QUALIVEST
FUNDS

CLASS A&C SHARES

QUALIVEST U.S. TREASURY MONEY MARKET FUND
QUALIVEST MONEY MARKET FUND
QUALIVEST TAX-FREE MONEY MARKET FUND
QUALIVEST TAX-FREE NATIONAL BOND FUND
QUALIVEST INTERMEDIATE BOND FUND
QUALIVEST DIVERSIFIED BOND FUND
QUALIVEST OPTIMIZED STOCK FUND
QUALIVEST INCOME EQUITY VALUE FUND
QUALIVEST LARGE COMPANIES VALUE FUND
QUALIVEST INTERNATIONAL OPPORTUNITIES FUND
QUALIVEST SMALL COMPANIES VALUE FUND

<TABLE>
<S> <C>
INVESTMENT ADVISER LEGAL COUNSEL
Qualivest Capital Management, Inc. Dechert Price & Rhoads
P.O. Box 2758 1500 K Street, N.W.
Portland, Oregon 97208 Washington, D.C. 20005-1208

ADMINISTRATOR & DISTRIBUTOR AUDITORS
BISYS Fund Services Deloitte & Touche LLP
3435 Stelzer Road 1700 Courthouse Plaza Northeast
Columbus, Ohio 43219-3035 Dayton, Ohio 45402
</TABLE>

TABLE OF CONTENTS

Page
----
Prospectus Summary............................................... 3
Fund Expenses.................................................... 7
Fee Tables....................................................... 8
Selected Financial Information................................... 12
Investment Objectives and Policies............................... 15
Investment Techniques and Risk Factors........................... 22
Valuation of Shares.............................................. 32
Purchasing Shares................................................ 33
Sales Charges on the Equity and Income Funds..................... 35
Qualivest Individual Retirement Accounts ("IRA")................. 40
Redeeming Shares................................................. 41
Management of the Funds.......................................... 44
Distribution Plans............................................... 47
Dividends and Taxes.............................................. 48
General Information.............................................. 51

PROSPECTUS DATED NOVEMBER 15, 1995

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS 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 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.
<PAGE>
QUALIVEST FUNDS

3435 Stelzer Road
Columbus, Ohio
43219 1-800-743-8637

Qualivest Funds (the "Trust") is an open-end management investment company
which offers eleven separate diversified investment portfolios ("funds"), each
with different investment objectives and policies. These funds enable the Trust
to meet a wide range of investment needs. This Prospectus relates only to the
following funds (the "Funds"):

- Qualivest U.S. Treasury Money Market Fund;

- Qualivest Money Market Fund;

- Qualivest Tax-Free Money Market Fund;

- Qualivest Tax-Free National Bond Fund;

- Qualivest Intermediate Bond Fund; Fund; and

- Qualivest Diversified Bond Fund;

- Qualivest Optimized Stock Fund;

- Qualivest Income Equity Value Fund;

- Qualivest Large Companies Value Fund;

- Qualivest International Opportunities Fund; and

- Qualivest Small Companies Value Fund.

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"), acts as
the investment adviser to each of the Funds.

Additional information about the Trust and each of its funds, contained in a
Statement of Additional Information dated November 15, 1995, has been filed with
the Securities and Exchange Commission and is available upon request without
charge by writing to the Trust at its address or by calling the Trust at the
telephone number shown above.

Continued on next page

The Shares of the Qualivest U.S. Treasury Money Market, Qualivest Money
Market and Qualivest Tax-Free Money Market Funds are not insured or guaranteed
by the United States Government. Each of these Funds seeks to maintain a
constant net asset value of $1.00 per Share, but there can be no assurance that
net asset value will not vary.

Shares of the Funds are not deposits or obligations of, and are not
endorsed, insured or guaranteed by, any bank, the Federal Deposit Insurance
Corporation, or any other agency. An investment in the Funds involves investment
risk, including the possible loss of principal.

This Prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Investors should read this
Prospectus and retain it for future reference.

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

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

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

2
<PAGE>
PROSPECTUS SUMMARY

<TABLE>
<S> <C>
Shares Offered........................ Class A and Class C Shares of the Qualivest Large
Companies Value Fund (the "Large Companies
Fund"), the Qualivest Small Companies Value Fund
(the "Small Companies Fund"), the Qualivest
International Opportunities Fund (the
"International Fund") and the Qualivest Optimized
Stock Fund (the "Optimized Fund") (collectively,
the "Equity Funds"); Class A and Class C Shares
of the Qualivest Intermediate Bond Fund (the
"Intermediate Bond Fund") and the Qualivest
Diversified Bond Fund (the "Bond Fund")
(collectively, the "Income Funds"); and Class A
Shares of the Qualivest U.S. Treasury Money
Market Fund (the "U.S. Treasury Fund"), the
Qualivest Money Market Fund (the "Money Market
Fund") and the Qualivest Tax-Free Money Market
Fund (the "Tax-Free Money Market Fund") (collec-
tively, the "Money Funds" and, with the Equity
Funds and the Income Funds, the "Funds"), which
are nine separate diversified investment
portfolios ("funds") of Qualivest Funds, a
Massachusetts business trust (the "Trust") which
is registered as an open-end management
investment company.

Offering Price and Sales Charges...... Each Equity Fund and each Income Fund offers
investors a choice of Class A and Class C Shares,
which differ principally with respect to sales
charges and the rate of expenses to which they
are subject. The public offering price of Class A
Shares of each Equity Fund is equal to the net
asset value per Share plus a sales charge equal
to 4.50% of the public offering price, reduced
when the total purchase amount is $50,000 or
more. The public offering price of Class A Shares
of each Income Fund is equal to the net asset
value per Share plus a sales charge equal to
3.50% of the public offering price, reduced when
the total purchase amount is $50,000 or more (see
"SALES CHARGES ON THE EQUITY AND INCOME
FUNDS--Class A Shares"). Under certain
circumstances, the sales charge may be elimi-
nated. The public offering price of Class C
Shares of each Equity Fund and each Income Fund
is equal to the net asset value per Share, but
investors may be subject to a contingent deferred
sales charge ("CDSC") of 1.00% when Class C
Shares are redeemed less than one year after
purchase.
</TABLE>

3
<PAGE>

<TABLE>
<S> <C>
The public offering price of each Money Fund is
equal to the net asset value per Share, which the
Trust will seek to maintain at $1.00.

Minimum Purchase...................... $500 minimum initial purchase per Fund, with $100
minimum subsequent investments. Such minimum ini-
tial investment may be waived for certain
purchasers and is reduced to $50 for investors
using the Auto Invest Plan described herein, and
such investors are subject to a $50 minimum for
each subsequent investment in a Fund.

Investment Objectives

Large Companies Fund.............. The Large Companies Fund seeks long-term capital
appreciation.

Small Companies Fund.............. The Small Companies Fund seeks capital
appreciation.

International Fund................ The International Fund seeks capital appreciation.

Optimized Fund.................... The Optimized Fund seeks capital appreciation and
current income.

Intermediate Bond Fund............ The Intermediate Bond Fund seeks current income
consistent with preservation of capital.

Bond Fund......................... The Bond Fund seeks current income consistent with
preservation of capital.

U.S. Treasury Fund and Money
Market Fund........................... The U.S. Treasury Fund and the Money Market Fund
seek current income consistent with liquidity and
stability of principal.

Tax-Free Money Market Fund........ The Tax-Free Money Market Fund seeks current
income, free from federal income tax, consistent
with liquidity and stability of principal.

Investment Policies

Large Companies Fund.............. Under normal market conditions, the Large Companies
Fund will invest at least 65% of its total assets
in common stocks and securities convertible into
common stocks of companies with a market
capitalization of at least $1 billion at the time
of purchase; income and payment of dividends is a
consideration in selecting investments.

Small Companies Fund.............. Under normal market conditions, the Small Companies
Fund will invest at least 65% of its total assets
in common stocks and securities convertible into
common
</TABLE>

4
<PAGE>

<TABLE>
<S> <C>
stocks of companies with a market capitalization
of less than $1 billion at the time of purchase.

International Fund................ Under normal market conditions, the International
Fund will invest at least 80% of its total assets
in common stocks and securities convertible into
common stocks of companies that are organized
under the laws of countries other than the U.S.
and whose securities are listed on the Morgan
Stanley Capital International EAFE (Europe,
Australasia, Far East) Index (the "EAFE Index"),
or in securities issued by large-sized U.S.
companies with substantial business activities
abroad.

Optimized Fund.................... Under normal market conditions, the Optimized Fund
will invest at least 80% of its total assets in
common stocks of companies whose securities are
listed on the Standard & Poor's 500 Composite
Stock Price Index (the "S&P 500 Index"), which
emphasizes stocks issued by large-sized
companies.

Intermediate Bond Fund............ Under normal market conditions, the Intermediate
Bond Fund will invest at least 65% of its total
assets in debt obligations with a maturity of at
least one year from the date of issue ("bonds").
Such debt obligations include corporate debt
obligations, mortgage-related securities and
obligations issued or guaranteed by the U.S.
Government or its agencies or instrumentalities.

Bond Fund......................... Under normal market conditions, the Bond Fund will
invest at least 65% of its total assets in bonds,
such as obligations issued or guaranteed by the
U.S. Government or its agencies or
instrumentalities, corporate debt obligations and
mortgage-related securities.

U.S. Treasury Fund................ Under normal market conditions, the U.S. Treasury
Fund will invest at least 65% of its total assets
in short-term U.S. Treasury bills, notes, and
bonds and in other obligations issued or
guaranteed by the U.S. Government.

Money Market Fund................. Under normal market conditions, the Money Market
Fund will invest in high quality (i.e., rated
within the two highest rating categories by a
nationally recognized statistical rating
organization ("NRSRO")) money market instruments
and other comparable investments.

Tax-Free Money Market Fund........ Under normal market conditions, the Tax-Free Money
Market Fund will invest at least 80% of its
assets in
</TABLE>

5
<PAGE>
<TABLE>
<S> <C>
short-term money market obligations the interest
on which is both exempt from federal income tax
and not treated as a preference item for
individuals for purposes of the federal
alternative minimum tax.

Risk Factors and Special
Considerations...................... An investment in the Funds involves a certain
amount of risk and may not be suitable for all
investors. See "INVESTMENT TECHNIQUES AND RISK
FACTORS."

Investment Adviser.................... Qualivest Capital Management, Inc. ("Qualivest"),
Portland, Oregon, a subsidiary of the United
States National Bank of Oregon ("U.S. Bank"),
serves as investment adviser to each Fund. See
"MANAGEMENT OF THE FUNDS--Investment Adviser."

Dividends and Capital Gains........... Dividends from net income are declared and paid
quarterly for the Equity Funds and monthly for the
Income Funds. Net realized capital gains are
distributed at least annually. For the Money
Funds, dividends from net income, excluding
short-term capital gains, are declared daily and
paid monthly, while dividends from short-term
capital gains, if any, are declared and paid as
deemed appropriate.

Other Information..................... U.S. Bank and The Bank of New York (each a "Custo-
dian") are the Trust's custodians. BISYS Fund
Services ("BISYS" or "Distributor" or
"Administrator") serves as the distributor and
administrator of the Funds. BISYS Fund Services
Ohio, Inc. ("Transfer Agent") serves as the
transfer agent and dividend disbursing agent and
provides certain accounting services for the
Trust.
</TABLE>

<PAGE>
GUIDE TO INVESTING IN THE QUALIVEST FUNDS

Purchase orders for the Funds received by the Distributor prior to 1:00 p.m.
Pacific Time for the Equity and Income Funds and 11:30 A.M. Pacific Time for the
Money Funds will become effective that day.

<TABLE>
<S> <C>
. Minimum Initial Investment (Such minimum may be reduced for certain
investors.)................................................................ $500

. Minimum Initial Investment for IRAs and other qualified retirement plans... $ 50

. Minimum Subsequent Investment (Such minimum may be reduced for certain
investors.)................................................................ $100

. Minimum Subsequent Investment for IRAs and other qualified retirement plans $ 50
</TABLE>

Shareholders may exchange Shares of an Equity or an Income Fund for Shares
of the same class of another Fund by telephone or mail. See "PURCHASING
SHARES--Exchange Privilege" for more information.

<TABLE>
<S> <C>
. Minimum Initial Exchange (No minimum for subsequent exchanges.)............ $500
</TABLE>

Shareholders may redeem Shares by telephone, mail or through a Fund's Auto
Withdrawal Plan.

All dividends and distributions will be automatically reinvested at net
asset value in additional Shares of the same class of the applicable Fund unless
cash payment is requested.

See "PURCHASING SHARES" and "REDEEMING SHARES" for more information.

FUND EXPENSES

The following expense tables indicate costs and expenses that an investor
should anticipate incurring either directly or indirectly as a Shareholder of a
Fund.

7
<PAGE>
FEE TABLES
<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
LARGE COMPANIES SMALL COMPANIES
VALUE FUND VALUE FUND
------------------ ------------------
<S> <C> <C> <C> <C>
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------

<CAPTION>
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price)............ 4.50% None 4.50% None
Maximum Sales Charge Imposed on Reinvested
Dividends (as a percentage of offering price).. None None None None
Deferred Sales Charge (as a percentage of
redemption proceeds)1.......................... None 1.00% None 1.00%
Redemption Fees (as a percentage of redemption
proceeds)...................................... None None None None
Exchange Fees.................................... None None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets annualized)
Management Fees After Waiver2.................... 0.60% 0.60% 0.80% 0.80%
12b-1 Fees3...................................... 0.25% 1.00% 0.25% 1.00%
Other Expenses................................... 0.34% 0.34% 0.31% 0.31%
------- ------- ------- -------
Total Fund Operating Expenses After Waiver4...... 1.19% 1.94% 1.36% 2.11%
------- ------- ------- -------
------- ------- ------- -------
<CAPTION>

QUALIVEST QUALIVEST
INTERNATIONAL OPTIMIZED
OPPORTUNITIES FUND STOCK FUND
------------------ ------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price)............ 4.50% None 4.50% None
Maximum Sales Charge Imposed on Reinvested
Dividends (as a percentage of offering price).. None None None None
Deferred Sales Charge (as a percentage of
redemption proceeds)1.......................... None 1.00% None 1.00%
Redemption Fees (as a percentage of redemption
proceeds)...................................... None None None None
Exchange Fees.................................... None None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets annualized)
Management Fees After Waiver2.................... 0.30% 0.30% 0.30% 0.30%
12b-1 Fees3...................................... 0.25% 1.00% 0.25% 1.00%
Other Expenses................................... 0.51% 0.51% 0.31% 0.31%
------- ------- ------- -------
Total Fund Operating Expenses After Waiver4...... 1.06% 1.81% 0.86% 1.61%
------- ------- ------- -------
------- ------- ------- -------
</TABLE>

8
<PAGE>
<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
INTERMEDIATE DIVERSIFIED
BOND FUND BOND FUND
------------------ ------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price)............ 3.50% None 3.50% None
Maximum Sales Charge Imposed on Reinvested
Dividends (as a percentage of offering price).. None None None None
Deferred Sales Charge (as a percentage of
redemption proceeds)1.......................... None 1.00% None 1.00%
Redemption Fees (as a percentage of
redemption proceeds)........................... None None None None
Exchange Fees.................................... None None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets annualized)
Management Fees After Waiver2.................... 0.45% 0.45% 0.30% 0.30%
12b-1 Fees3...................................... 0.25% 1.00% 0.25% 1.00%
Other Expenses................................... 0.29% 0.29% 0.32% 0.32%
------- ------- ------- -------
Total Fund Operating Expenses After Waiver4...... 0.99% 1.74% 0.87% 1.62%
------- ------- ------- -------
------- ------- ------- -------
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
U.S. TREASURY MONEY MARKET QUALIVEST TAX-FREE
MONEY MARKET FUND FUND MONEY MARKET FUND
----------------- ------------ ------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on
Purchases (as a percentage of offering
price)................................ None None None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a percentage
of offering price).................... None None None
Deferred Sales Charge (as a percentage
of redemption proceeds)............... None None None
Redemption Fees (as a percentage of
redemption proceeds).................. None None None
Exchange Fees........................... None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets
annualized)
Management Fees After Waiver2........... 0.00% 0.25% 0.00%
12b-1 Fees3............................. 0.40% 0.40% 0.40%
Other Expenses.......................... 0.32% 0.27% 0.55%
----- ----- -----
Total Fund Operating Expenses After
Waiver4............................... 0.72% 0.92% 0.95%
----- ----- -----
----- ----- -----
</TABLE>

9
<PAGE>
- -------

1 A 1% CDSC is imposed only on redemptions of Shares redeemed less than one year
after purchase, except for redemptions by certain "Institutional Investors" as
defined below under "SALES CHARGES ON THE EQUITY AND INCOME FUNDS--Contingent
Deferred Sales Charge ("CDSC")--Class C Shares."

2 Qualivest has agreed to temporarily waive a portion of its investment advisory
fee for some of the Funds for the current fiscal year. Waived fees cannot be
recovered at a future date. Absent the advisory fee waiver, "Management Fees"
as a percentage of average daily net assets would be 0.75% for the Large
Companies Fund, 0.60% for each of the International Fund, the Intermediate
Bond Fund and the Bond Fund, 0.50% for the Optimized Fund and 0.35% for each
of the Money Funds. See "MANAGEMENT OF THE FUNDS--Investment Adviser."

3 As a result of the payment of 12b-1 fees, long-term Shareholders of the Equity
Funds and the Income Funds may pay more than the economic equivalent of the
maximum front-end sales charge permitted by the National Association of
Securities Dealers, Inc.

4 Absent the waiver of the investment advisory fee, "Total Fund Operating
Expenses" as a percentage of average daily net assets would be 1.34% and
2.09%, respectively, for the Class A and Class C Shares of the Large Companies
Fund, 1.36% and 2.11%, respectively, for the Class A and Class C Shares of the
International Fund, 1.06% and 1.81%, respectively, for the Class A and Class C
Shares of the Optimized Fund, 1.14% and 1.89%, respectively, for the Class A
and Class C Shares of the Intermediate Bond Fund, 1.17% and 1.92%,
respectively, for the Class A and Class C Shares of the Bond Fund, 1.07% for
the U.S. Treasury Fund, 1.02% for the Money Market Fund and 1.30% for the
Tax-Free Money Market Fund.

The purpose of these tables is to assist the prospective investor in
understanding the various costs and expenses that a Shareholder in the Funds
will bear. The tables have been restated to reflect the current fees for the
Funds.

EXAMPLES*

An investor would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return, and (2) redemption at the end of each time
period:
<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
LARGE COMPANIES SMALL COMPANIES
VALUE FUND VALUE FUND
-------------------- --------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------

<S> <C> <C> <C> <C>
1 Year.............................................. $ 57 $ 20 $ 58 $ 21
3 Years............................................. $ 81 $ 61 $ 86 $ 66
5 Years............................................. $ 107 $ 105 $ 116 $ 113
10 Years............................................ $ 183 $ 226 $ 201 $ 244
</TABLE>

10
<PAGE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
INTERNATIONAL OPTIMIZED
OPPORTUNITIES FUND STOCK FUND
-------------------- --------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------

<S> <C> <C> <C> <C>
1 Year.............................................. $ 55 $ 18 $ 54 $ 16
3 Years............................................. $ 77 $ 57 $ 72 $ 51
5 Years............................................. $ 101 $ 98 $ 93 $ 88
10 Years............................................ $ 169 $ 213 $ 151 $ 191
<CAPTION>

QUALIVEST QUALIVEST
INTERMEDIATE DIVERSIFIED
BOND FUND BOND FUND
-------------------- --------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
1 Year.............................................. $ 45 $ 18 $ 44 $ 16
3 Years............................................. $ 65 $ 55 $ 62 $ 51
5 Years............................................. $ 88 $ 94 $ 82 $ 88
10 Years............................................ $ 152 $ 205 $ 139 $ 192
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST
U.S. TREASURY MONEY MARKET TAX-FREE MONEY
MONEY MARKET FUND FUND MARKET FUND
----------------- ------------ --------------
<S> <C> <C> <C>
1 Year........................................ $ 7 $ 9 $ 10
3 Years....................................... $23 $ 29 $ 30
5 Years....................................... $40 $ 51 $ 53
10 Years...................................... $89 $113 $117
</TABLE>

- -------

* These examples should not be considered representations of future expenses,
which may be more or less than those shown. The assumed 5% annual return is
hypothetical and should not be considered a representation of past or future
annual return. Actual return may be greater or less than the assumed amount.

11
<PAGE>
SELECTED FINANCIAL INFORMATION

The following tables of selected financial information are included to
assist Shareholders in evaluating the performance of the Funds since their
commencements of operations through July 31, 1995. The information set forth in
these tables has been audited by Deloitte & Touche LLP, the Trust's independent
auditors, whose report on the Funds' financial statements is included in the
Funds' Annual Report, which may be obtained without charge, and is incorporated
by reference in the Funds' Statement of Additional Information. The Annual
Report also includes Management's Discussion of Fund Performance. This
information should be read in conjunction with the financial statements.

<TABLE>
<CAPTION>
QUALIVEST LARGE QUALIVEST SMALL
COMPANIES VALUE FUND COMPANIES VALUE FUND
AUGUST 1, 1994 TO AUGUST 1, 1994 TO
JULY 31, 1995(a) JULY 31, 1995(a)
-------------------- --------------------
<S> <C> <C> <C> <C>
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
NET ASSET VALUE, BEGINNING OF PERIOD............. $ 10.00 $ 10.00 $ 10.00 $ 10.00
INVESTMENT ACTIVITIES
Net investment income........................ 0.18 0.12 0.09 (0.03)
Net realized and unrealized gains from
investments................................ 2.23 2.11 3.29 3.29
------- ------- ------- -------
Total from Investment Activities......... 2.41 2.23 3.38 3.26
------- ------- ------- -------
DISTRIBUTIONS
Net investment income........................ (0.18) (0.16) (0.10) (0.07)
Net realized gains........................... (0.03) (0.03) (0.05) (0.05)
------- ------- ------- -------
Total Distributions...................... (0.21) (0.19) (0.15) (0.12)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD................... $ 12.20 $ 12.04 $ 13.23 $ 13.14
------- ------- ------- -------
------- ------- ------- -------
TOTAL RETURN--EXCLUDING SALES LOAD............... 24.61% 22.78% 34.29% 33.02%
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000)............ $ 1,056 $ 271 $ 1,257 $ 312
Ratio of expenses to average net assets...... 1.04% 1.78% 1.11% 1.85%
Ratio of net investment income to average net
assets..................................... 1.70% 0.91% 0.63% (0.10)%
Ratio of expenses to average net assets*..... 1.38% 2.13% 1.38% 2.13%
Ratio of net investment income to average net
assets*.................................... 1.36% 0.56% 0.36% (0.38)%
Portfolio turnover rate(d)................... 48% 48% 37% 37%
</TABLE>

12
<PAGE>

<TABLE>
<CAPTION>
QUALIVEST
INTERNATIONAL QUALIVEST OPTIMIZED
OPPORTUNITIES FUND STOCK FUND
JULY 3, 1995 TO MAY 2, 1995 TO
JULY 31, 1995(a) JULY 31, 1995(a)
---------------------- -------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD......... $ 10.00 $ 10.00 $ 10.00 $ 10.00
INVESTMENT ACTIVITIES
Net investment income.................... (0.01) 0.03 0.03
Net realized and unrealized gains on
investments............................ 0.45 0.47 0.93 0.91
------- ------- ------- -------
Total from Investment Activities..... 0.45 0.46 0.96 0.94
------- ------- ------- -------
DISTRIBUTIONS
Net investment income.................... (0.02) (0.02)
------- ------- ------- -------
Total Distributions.................. (0.02) (0.02)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD............... $ 10.45 $ 10.46 $ 10.94 $ 10.92
------- ------- ------- -------
------- ------- ------- -------
TOTAL RETURN--EXCLUDING SALES LOAD(b)........ 4.50% 4.60% 9.64% 9.41%
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000)........ $ 20 $ 0 $ 35 $ 20
Ratio of expenses to average net
assets(c).............................. 1.40% 2.18% 0.91% 1.68%
Ratio of net investment income to average
net assets(c).......................... 0.23% 0.32% 1.03% 1.13%
Ratio of expenses to average net
assets*(c)............................. 1.54% 2.39% 1.10% 1.88%
Ratio of net investment income to average
net assets*(c)......................... 0.09% 0.12% 0.85% 0.92%
Portfolio turnover rate(d)............... 0% 0% 5% 5%
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST
INTERMEDIATE QUALIVEST DIVERSIFIED
BOND FUND BOND FUND
AUGUST 1, 1994 TO MAY 2, 1995 TO
JULY 31, 1995(a) JULY 31, 1995(a)
-------------------- -----------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD............. $ 10.00 $ 10.00 $ 10.00 $ 10.00
INVESTMENT ACTIVITIES
Net investment income........................ 0.53 0.46 0.01 0.01
Net realized and unrealized gains on
investments................................ 0.11 0.05 0.30 0.33
------- ------- ------- -------
Total from Investment Activities......... 0.64 0.51 0.31 0.34
------- ------- ------- -------
DISTRIBUTIONS
Net investment income........................ (0.58) (0.55) (0.13) (0.12)
------- ------- ------- -------
Total Distributions...................... (0.58) (0.55) (0.13) (0.12)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD................... $ 10.06 $ 9.96 $ 10.18 $ 10.22
------- ------- ------- -------
------- ------- ------- -------
TOTAL RETURN--EXCLUDING SALES LOAD............... 6.67% 5.42% 3.07%(b) 3.35%(b)
</TABLE>

13
<PAGE>

<TABLE>
<CAPTION>
QUALIVEST
INTERMEDIATE QUALIVEST DIVERSIFIED
BOND FUND BOND FUND
AUGUST 1, 1994 TO MAY 2, 1995 TO
JULY 31, 1995(a) JULY 31, 1995(a)
-------------------- -----------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000)............ $ 381 $ 133 $ 0 $ 0
Ratio of expenses to average
net assets................................. 0.80% 1.59% 0.95%(c) 1.70%(c)
Ratio of net investment income to average net
assets..................................... 5.94% 5.18% 5.66%(c) 4.91%(c)
Ratio of expenses to average net assets*..... 1.17% 1.92% 1.25%(c) 2.00%(c)
Ratio of net investment income to average net
assets*.................................... 5.57% 4.85% 5.36%(c) 4.61%(c)
Portfolio turnover rate(d)................... 107% 107% 34% 34%
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST
TAX-FREE
QUALIVEST U.S. TREASURY QUALIVEST MONEY MONEY MARKET FUND
MONEY MARKET FUND MARKET FUND JANUARY 9, 1995
JANUARY 11, 1995 TO AUGUST 1, 1994 TO TO
JULY 31, 1995(a) JULY 31, 1995(a) JULY 31, 1995(a)
----------------------- -------------------- -----------------

<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD... $ 1.00 $ 1.00 $ 1.00
INVESTMENT ACTIVITIES
Net investment income.............. 0.028 0.049 0.017
-------- ---------- --------
DISTRIBUTIONS
Net investment income.............. (0.028) (0.049) (0.017)
-------- ---------- --------
NET ASSET VALUE, END OF PERIOD......... $ 1.00 $ 1.00 $ 1.00
-------- ---------- --------
-------- ---------- --------
TOTAL RETURN........................... 2.79%(b) 4.97% 1.66%(b)
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period
(000)............................ $73,423 $216,679 $33,569
Ratio of expenses to average net
assets........................... 0.81%(c) 0.79% 1.00%(c)
Ratio of net investment income to
average net assets............... 5.02%(c) 5.09% 2.98%(c)
Ratio of expenses to average net
assets*.......................... 1.17%(c) 1.04% 1.36%(c)
Ratio of net investment income to
average net assets*.............. 4.66%(c) 4.83% 2.61%(c)
</TABLE>

- -------

* During the period the investment advisory and custodian fees were voluntarily
reduced. If such voluntary fee reductions had not occurred, the ratios would
have been as indicated.

(a) Period from commencement of operations.

(b) Not annualized.

(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing between the classes of Shares issued.

14
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES

GENERAL

The Large Companies Fund. The investment objective of the Large Companies
Fund is to seek long-term capital appreciation. It invests primarily in common
stocks and securities convertible into common stocks of large capitalization
companies. For purposes of this policy, large capitalization companies are those
with capitalization of $1 billion or more at the time of purchase.

The Small Companies Fund. The investment objective of the Small Companies
Fund is to seek capital appreciation. It invests primarily in common stocks and
securities convertible into common stocks of small-sized companies. For purposes
of this policy, small-sized companies are considered to be those with
capitalization of less than $1 billion at the time of purchase. Smaller
capitalization stocks may be quite volatile and subject to wide fluctuations in
both the short and medium term.

The International Fund. The investment objective of the International Fund is
to seek capital appreciation. It invests primarily in common stocks and
securities convertible into common stocks of companies that are organized under
the laws of at least three countries other than the U.S. whose securities are
listed on the EAFE Index. It may also invest in securities issued by large
capitalization U.S. companies with substantial business activities abroad.

The Optimized Fund. The investment objective of the Optimized Fund is to seek
capital appreciation and current income. It invests primarily in common stocks
and securities convertible into common stocks of companies whose securities are
listed on the S&P 500 Index.

The Intermediate Bond Fund. The investment objective of the Intermediate Bond
Fund is to seek current income consistent with preservation of capital. It
invests primarily in debt obligations which include corporate debt obligations,
mortgage-related securities and obligations issued or guaranteed by the U.S.
Government or its agencies or instrumentalities.

The Bond Fund. The investment objective of the Bond Fund is to seek current
income consistent with preservation of capital. It invests primarily in
obligations issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, corporate debt obligations and mortgage-related securities.

The U.S. Treasury Fund. The investment objective of the U.S. Treasury Fund is
to seek current income consistent with liquidity and stability of principal. It
invests primarily in short-term U.S. Treasury bills, notes, and bonds and in
other money market instruments issued or guaranteed by the U.S. Government.

The Money Market Fund. The investment objective of the Money Market Fund is
to seek current income consistent with liquidity and stability of principal. It
invests in high quality short-term money market instruments.

The Tax-Free Money Market Fund. The investment objective of the Tax-Free
Money Market Fund is to seek current income, free from federal income tax,
consistent with liquidity and stability of principal. Under normal market
conditions and as a fundamental policy, at least 80% of the net assets of the
Tax-Free Money Market Fund will be invested in high quality money market
instruments the interest on which is both exempt from federal income tax and not
treated as a preference item for individuals for purposes of the federal
alternative minimum tax.

* * * *

The investment objective of each Fund is a fundamental policy and as such may
not be

15
<PAGE>

changed without a vote of the holders of a majority of the outstanding Shares of
that Fund. Other policies of a Fund may be changed without a vote of the holders
of a majority of outstanding Shares of that Fund unless (i) the policy is
expressly deemed to be a fundamental policy, or (ii) the policy is expressly
deemed to be changeable only by such majority vote. There can be no assurance
that the investment objective of any Fund will be achieved.

INVESTMENT POLICIES--EQUITY FUNDS

LARGE COMPANIES AND SMALL COMPANIES FUNDS

Each of these Funds seeks to achieve its investment objective by following
flexible investment policies emphasizing investment in common stocks and
securities convertible into common stocks (without regard to NRSRO rating) that
are, in Qualivest's opinion, undervalued relative to other securities at the
time of purchase. In analyzing different securities, Qualivest will consider
ratios of market price to book value, ratios of market price to earnings, ratios
of market price to assets, estimated liquidating value, earnings growth rate,
and cash flow as significant factors in assessing relative value. If in
Qualivest's opinion a stock has reached a fully valued position, it will, under
most circumstances, be sold and replaced by securities which are deemed to be
undervalued in the marketplace.

Under normal market conditions, each of the Large Companies and Small
Companies Funds will invest primarily in common stocks and securities
convertible into common stocks of companies believed by Qualivest to be
characterized by sound management and the potential for long-term capital
appreciation. Qualivest also may consider income and payment of dividends in
selecting securities for the Large Companies Fund. Under normal market
conditions, the Large Companies Fund intends to invest at least 65% of its total
assets in common stocks and securities convertible into common stocks of
companies with a market capitalization of at least $1 billion at the time of
purchase. In addition, under normal market conditions, the Small Companies Fund
will invest at least 65% of its total assets in common stocks and securities
convertible into common stocks of companies with a market capitalization of less
than $1 billion at the time of purchase. If the Large Companies Fund owns
securities issued by a company whose market capitalization falls below $1
billion, or the Small Companies Fund owns securities issued by a company whose
market capitalization increases above $1 billion, Qualivest may, but is not
required to, sell such securities. However, Qualivest will sell such securities
if, in its judgment, market conditions warrant such a sale, or if the Large
Companies Fund or Small Companies Fund would no longer be primarily invested in
common stocks and securities convertible into common stocks issued by large
capitalization companies and small-sized companies, respectively.

Each of the Large Companies and Small Companies Funds may also invest up to
35% of the value of its total assets in preferred stocks, corporate bonds,
notes, units of real estate investment trusts, asset-backed and mortgage-related
securities, warrants, and short-term obligations (with maturities of 12 months
or less) consisting of commercial paper (including variable amount master demand
notes), bankers' acceptances, certificates of deposit, repurchase agreements,
obligations issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, and demand and time deposits of domestic and foreign banks
and savings and loan associations. Each of these Funds may also hold securities
of other investment companies and depositary or custodial receipts representing
beneficial interests in any of the foregoing securities.

Each of these Funds may invest in corporate debt securities such as bonds and
notes which are

16
<PAGE>
rated at the time of purchase within the four highest rating groups assigned by
an NRSRO (e.g., in the case of Moody's Investors Service, Inc. ("Moody's"), Aaa,
Aa, A and Baa, and in the case of Standard & Poor's Corporation ("S&P"), AAA,
AA, A and BBB), which are considered to be investment grade or, if unrated,
which Qualivest deems to present attractive opportunities and are of comparable
quality. For a description of NRSROs and their rating symbols, see the Appendix
to the Statement of Additional Information. For a discussion of debt securities
rated within the fourth highest rating group assigned by an NRSRO, see
"INVESTMENT TECHNIQUES AND RISK FACTORS--Medium-Grade Securities" herein.

Subject to the foregoing policies, each of these Funds may also invest up to
25% of its total assets in foreign securities either directly or through the
purchase of American Depositary Receipts and may also invest in securities
issued by foreign branches of U.S. banks and foreign banks, in Canadian
Commercial Paper, and in Europaper (U.S. dollar denominated commercial paper of
a foreign issuer). For a discussion of risks associated with foreign securities,
see "INVESTMENT TECHNIQUES AND RISK FACTORS" herein.

INTERNATIONAL AND OPTIMIZED FUNDS

The International Fund and the Optimized Fund each seeks to achieve its
investment objective by investing primarily in common stocks and securities
convertible into common stocks (without regard to NRSRO rating) of companies
whose securities are listed on a specific securities index. While the
performance of the Optimized Fund may be expected to approximate the performance
of the relevant broad market index, Qualivest seeks to outperform the index
through limited management of the Fund's portfolio.

Under normal market conditions, at least 80% of the total assets of the
International Fund will be invested in common stocks and securities convertible
into common stocks of foreign companies whose securities are listed on the EAFE
Index. The International Fund will invest in the securities of issuers from at
least three countries other than the U.S. Investments are selected for inclusion
in the Fund's portfolio primarily on the basis of market capitalization and
industry weightings, and to create an aggregate country weighting similar to
that of the EAFE Index. While Qualivest anticipates that substantially all of
the Fund's assets will be so invested, Qualivest may invest up to 20% of the
International Fund's total assets in common stocks and securities convertible
into common stocks of large capitalization U.S. companies that Qualivest deems
to present attractive investment opportunities due to such companies' foreign
business operations.

Under normal market conditions, at least 80% of the Optimized Fund's total
assets will be invested in common stocks and securities convertible into common
stocks of companies whose securities are listed on the S&P 500 Index. While
Qualivest anticipates that substantially all of the Fund's assets will be so
invested, Qualivest may invest up to 20% of the Optimized Fund's total assets as
described below.

17
<PAGE>
may be optimized by selecting those securities whose growth and value
characteristics indicate that their performance, relative to the other
securities listed on the S&P 500 Index, will exceed the extent to which the S&P
500 Index reflects their performance. Qualivest intends to utilize computer
modelling and other strategies to identify those stocks that, in light of its
assessment of general economic conditions, Qualivest believes will achieve
capital appreciation and current income superior to the performance of a
portfolio that merely seeks to replicate the S&P 500 Index.

Each of the International Fund and the Optimized Fund may also invest up to
20% of the value of its total assets in short-term obligations (with maturities
of 12 months or less) consisting of commercial paper (including variable amount
master demand notes), bankers' acceptances, certificates of deposit, repurchase
agreements, obligations issued or guaranteed by the U.S. Government or its
agencies or instrumentalities, and demand and time deposits of domestic and
foreign banks and savings and loan associations. These Funds may also each hold
securities of other investment companies and depositary or custodial receipts
representing beneficial interests in any of the foregoing securities.

Because of Qualivest's generally passive management approach with regard to
the International Fund and the Optimized Fund, the portfolio turnover rate for
each Fund is expected to be under 50%, a generally lower turnover rate than for
most other investment companies. Qualivest believes that a lower turnover rate
will reduce securities transaction costs incurred by these Funds.

* * * *

Consistent with the foregoing, each of the Equity Funds will focus its
investments in those companies and types of companies that Qualivest believes
will enable such Fund to achieve its investment objective. No Equity Fund will
invest more than 15% of its net assets in securities that are deemed to be
illiquid. During temporary defensive periods as determined by Qualivest, any of
the Equity Funds may hold up to 100% of its total assets in high quality
short-term debt obligations including domestic bank certificates of deposit,
bankers' acceptances and repurchase agreements secured by bank instruments.
However, to the extent that an Equity Fund is so invested, its investment
objective may not be achieved during that time.

INVESTMENT POLICIES--INCOME FUNDS

Under normal market conditions, at least 65% of the total assets of each
Income Fund will be invested in bonds. Bonds in which these Funds may invest can
have maturities of up to thirty years or more. Each Income Fund may invest up to
35% of its total assets in high quality money market instruments such as
commercial paper (including variable amount master demand notes), certificates
of deposit and bankers' acceptances, variable and floating rate notes and
asset-backed securities without regard to maturity, except as set forth below.
In addition, each Income Fund may engage in certain loans of portfolio
securities, repurchase agreements and reverse repurchase agreements, and may
also invest in securities of other investment companies. The Intermediate Bond
Fund will maintain a dollar-weighted average maturity of three to seven years
under ordinary market conditions, while the Bond Fund will maintain a dollar-
weighted average maturity of approximately seven to eleven years under ordinary
market conditions.

Each Income Fund expects to invest in bonds, notes and debentures of a wide
range of U.S. corporate issuers. Such obligations, in the case of debentures,
will represent unsecured promises to pay, in the case of notes and bonds, may be
secured by mortgages on real property or security interests in personal property
and will in most

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<PAGE>
cases differ in their interest rates, maturities and times of issuance.

Each Income Fund may also invest in corporate debt securities and convertible
debt securities which are rated at the time of purchase within the four highest
rating groups assigned by an NRSRO (e.g., in the case of Moody's, Aaa, Aa, A and
Baa, and in the case of S&P, AAA, AA, A and BBB), which are considered to be
investment grade or, if unrated, which Qualivest deems to present attractive
opportunities and are of comparable quality. For a description of NRSROs and
their rating symbols, see the Appendix to the Statement of Additional
Information. For a discussion of debt securities rated within the fourth highest
rating group assigned by an NRSRO, see "INVESTMENT TECHNIQUES AND RISK
FACTORS--Medium-Grade Securities" herein.

Each Income Fund may hold short-term obligations (with maturities of 12 months
or less) consisting of domestic and foreign commercial paper rated at the time
of purchase within the top two categories by an NRSRO (e.g., "A-2" or better by
S&P, "Prime-2" or better by Moody's, or "F-2" or better by Fitch Investors
Service ("Fitch")) or, if unrated, which Qualivest deems to present attractive
opportunities and are of comparable quality, including variable amount master
demand notes, bankers' acceptances, certificates of deposit and time deposits of
domestic and foreign branches of U.S. banks and foreign banks, and repurchase
agreements. Each Income Fund may also invest in securities of other investment
companies or in Guaranteed Investment Contracts ("GICs"), which are considered
to be illiquid securities.

Each Income Fund may also invest in obligations of the Export-Import Bank of
the United States, in U.S. dollar denominated international bonds for which the
primary trading market is in the United States ("Yankee Bonds"), or for which
the primary trading market is abroad ("Eurodollar Bonds"), and in Canadian Bonds
and bonds issued by institutions, such as the World Bank and the European
Economic Community, organized for a specific purpose by two or more sovereign
governments ("Supranational Agency Bonds").

Each Income Fund expects to invest in a variety of U.S. Treasury obligations,
differing in their interest rates, maturities, and times of issuance, as well as
"stripped" U.S. Treasury obligations such as Treasury Receipts issued by the
U.S. Treasury representing either future interest or principal payments
("Stripped Treasury Obligation"), and mortgage-related securities issued or
guaranteed by the U.S. Government or its agencies or instrumentalities, such as
the Government National Mortgage Association ("GNMA"), the Federal National
Mortgage Association ("FNMA"), the Federal Farm Credit Bureau ("FFCB"), the
Tennessee Valley Authority ("TVA"), the Federal Home Loan Bank ("FHLB"), the
Federal Land Bank, the Federal Home Loan Mortgage Corporation ("FHLMC"), the
Student Loan Marketing Association ("SLMA") and in mortgage-related securities
issued by nongovernmental entities.

Each Income Fund may invest in mortgage-related securities which are rated at
the time of purchase within the four highest rating categories assigned by an
NRSRO or, if unrated, which Qualivest deems to present attractive opportunities
and are of comparable quality, and have mortgage obligations backing such
securities, consisting of conventional thirty year fixed rate mortgage
obligations, graduated payment mortgage obligations, fifteen year mortgage
obligations and adjustable rate mortgage obligations.

Each Income Fund also may invest in mortgage-related securities issued by
nongovernmental entities. Commercial banks, savings and loan institutions,
private mortgage insurance companies, mortgage bankers and other secondary
market issuers also create pass-through pools of

19
<PAGE>
conventional residential mortgage loans. Although the market for such securities
is becoming increasingly liquid, securities issued by certain private
organizations may not be readily marketable. An Income Fund will not purchase
mortgage-related securities or any other assets which in Qualivest's opinion are
illiquid, if as a result, more than 15% of the value of that Fund's net assets
will be illiquid.

Mortgage-related securities in which the Income Funds may invest may also
include collateralized mortgage obligations ("CMOs"), which are debt obligations
issued generally by finance subsidiaries or trusts that are secured by
mortgage-backed certificates, including, in many cases, certificates issued by
government-related guarantors, including GNMA, FNMA and FHLMC, together with
certain funds and other collateral.

Each Income Fund may invest in asset-backed securities (unrelated to first
mortgage loans), which represent fractional interests in pools of leases, retail
installment loans or revolving credit receivables, both secured (such as
Certificates for Automobile Receivables or "CARS") and unsecured (such as Credit
Card Receivable Securities or "CARDS"). These assets are generally held by a
trust and payments of principal and interest or interest only are passed through
monthly or quarterly to certificate holders and may be guaranteed up to certain
amounts by letters of credit issued by a financial institution affiliated or
unaffiliated with the trustee or originator of the trust. Asset-backed
securities will be purchased only if they meet the rating requirements set forth
above or, if unrated, deemed to be of comparable quality by Qualivest with
respect to the Income Funds' investments in fixed-income securities of U.S.
corporations and mortgage-related securities.

An increase in interest rates will generally reduce the value of the
investments in an Income Fund, and a decline in interest rates will generally
increase the value of those investments. Depending upon the prevailing market
conditions, Qualivest may purchase debt securities at a discount from face
value, which produces a yield greater than the coupon rate. Conversely, if debt
securities are purchased at a premium over face value, the yield will be lower
than the coupon rate.

In making investment decisions for the Income Funds, Qualivest will consider
many factors, including current yield, maturity, and yield to maturity.
Qualivest will also monitor the financial condition of the issuers of an Income
Fund's portfolio investments and may shorten the average weighted portfolio
maturity of the Fund, in light of its investment objective of preservation of
capital, if economic or market conditions warrant such action.

INVESTMENT POLICIES--MONEY FUNDS

Although each Money Fund has the same investment adviser and a similar
investment objective, its particular portfolio securities and yield may differ
due to differences in the types of permitted investments, cash flow, and the
availability of particular portfolio investments.

U.S. TREASURY FUND

Under normal market conditions, the U.S. Treasury Fund invests at least 65% of
its total assets in short-term U.S. Treasury bills, notes, and bonds and in
other obligations issued or guaranteed by the U.S. Government. The U.S. Treasury
Fund may invest up to 35% of its total assets in other types of high quality
rated money market instruments and money market instruments that, although not
rated, are deemed to be of comparable high quality as determined by Qualivest
pursuant to guidelines adopted by the Board of Trustees.

This Fund expects that a majority of its income will be exempt from state
taxes as a

20
<PAGE>
result of its investing in U.S. Government securities whose interest payments
are state tax-exempt. Most states allow for a pass-through of this tax
exemption, so that the Fund's dividend distributions may also be state
tax-exempt with respect to the income earned by the Fund on U.S. Government
securities.

MONEY MARKET FUND

The Money Market Fund invests in high quality rated money market instruments
and other money market instruments that, although not rated, are deemed to be of
comparable high quality as determined by Qualivest pursuant to guidelines
adopted by the Board of Trustees.

TAX-FREE MONEY MARKET FUND

The Tax-Free Money Market Fund invests primarily in high quality money market
obligations issued by or on behalf of states, territories and possessions of the
United States, the District of Columbia and other political subdivisions,
agencies, instrumentalities and authorities, the interest on which is both
exempt from federal income tax and not treated as a preference item for
individuals for purposes of the federal alternative minimum tax, and similar
tax-exempt money market instruments that, although not rated, are deemed to be
of comparable high quality as determined by Qualivest pursuant to guidelines
adopted by the Board of Trustees ("Municipal Securities"). As a matter of
fundamental policy, under normal market conditions, at least 80% of the Tax-Free
Money Market Fund's net assets will be invested in short-term Municipal
Securities.

The Tax-Free Money Market Fund may invest up to 20% of its net assets in
taxable obligations, the interest on which is either subject to federal income
tax or treated as a preference item for purposes of the federal alternative
minimum tax. At times, Qualivest may determine that, because of unstable
conditions in the markets for Municipal Securities, pursuing the Tax-Free Money
Market Fund's basic investment strategies is inconsistent with the best
interests of the Shareholders of the Tax-Free Money Market Fund. At such times,
Qualivest may use temporary defensive strategies differing from those designed
to achieve the Tax-Free Money Market Fund's investment objective by increasing
the Tax-Free Money Market Fund's holdings in taxable obligations to over 20%
(and up to 100%) of the Tax-Free Money Market Fund's net assets and by holding
uninvested cash reserves pending investment. Taxable obligations may include
obligations issued or guaranteed by the U.S. Government or its agencies or
instrumentalities (some of which may be subject to repurchase agreements),
certificates of deposit and bankers' acceptances of selected banks, and
commercial paper meeting the Tax-Free Money Market Fund's quality standards (as
described below) for tax-exempt commercial paper.

* * * *

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<PAGE>

Tier Securities") and not more than the greater of 1% of total assets or one
million dollars is invested in the securities of any one issuer of Second Tier
Securities. All securities or instruments in which a Fund invests have remaining
maturities of 397 calendar days (thirteen months) or less. In addition, no Money
Fund will invest more than 10% of its net assets in securities that are deemed
to be illiquid. The dollar-weighted average maturity of the obligations in a
Money Fund will not exceed 90 days.

Subject to the foregoing general limitations, the Money Funds expect to invest
in the types of securities discussed below under "INVESTMENT TECHNIQUES AND RISK
FACTORS." These securities include short-term obligations issued or guaranteed
by the U.S. Government or its agencies or instrumentalities, short-term
asset-backed and mortgage-related securities, bankers' acceptances, certificates
of deposit and time deposits (including Eurodollar Certificates of Deposit
("ECDs"), Eurodollar Time Deposits ("ETDs"), Canadian Time Deposits ("CTDs"),
and Yankee Certificates of Deposit ("Yankee CDs")), commercial paper (including
variable amount master demand notes), securities issued by other money market
investment companies, GICs, repurchase agreements, reverse repurchase agreements
and dollar roll agreements.

INVESTMENT TECHNIQUES AND RISK FACTORS

Like any investment program, an investment in a Fund entails certain risks.

U.S. GOVERNMENT OBLIGATIONS

The types of U.S. Government obligations in which each Fund may invest include
U.S. Treasury notes, bills, bonds and any other securities directly issued by
the U.S. Government that are available for public investment, which differ only
in their interest rates, maturities, and times of issuance, as well as Stripped
Treasury Obligations and obligations issued or guaranteed by the U.S. Government
or its agencies or instrumentalities. Stripped securities are issued at a
discount to their "face value" and may exhibit greater price volatility than
ordinary debt securities because of the manner in which their principal and
interest are returned to investors. The Stripped Treasury Obligations in which
the Funds may invest do not include Certificates of Accrual on Treasury
Securities ("CATS") or Treasury Income Growth Receipts ("TIGRs").

Obligations of certain agencies and instrumentalities of the U.S. Government,
such as the GNMA, are supported by the full faith and credit of the U.S.
Treasury; others, such as those of the FNMA, are supported by the right of the
issuer to borrow from the Treasury; others, such as those of the SLMA, are
supported by the discretionary authority of the U.S. Government to purchase the
agency's obligations; still others, such as those of the FFCB or the FHLMC, are
supported only by the credit of the instrumentality. No assurance can be given
that the U.S. Government would provide financial support to U.S.
Government-sponsored agencies or instrumentalities if it is not obligated to do
so by law. The Funds will invest in the obligations of such agencies or
instrumentalities only when Qualivest believes that the credit risk with respect
thereto is minimal. The U.S. Government does not guarantee the market value of
any security; therefore, the market value of the U.S. Government obligations in
a Fund's portfolio can be expected to fluctuate as interest rates change.

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<PAGE>
MORTGAGE-RELATED AND ASSET-BACKED SECURITIES

Investments in these and other derivative securities will not be made for
purposes of leverage or speculation, but rather primarily for conventional
investment or hedging purposes, liquidity, flexibility and to capitalize on
market inefficiencies. Consistent with its investment objective, restrictions
and policies, each of the Funds except the Optimized Fund and the International
Fund may invest in mortgage-related securities, which are securities
representing interests in "pools" of mortgages in which payments of both
interest and principal on the securities are made monthly, in effect "passing
through" monthly payments made by the individual borrowers on the residential
mortgage loans which underlie the securities (net of fees paid to the issuer or
guarantor of the securities). Early repayment of principal on mortgage-related
securities (arising from prepayments of principal due to sale of the underlying
property, refinancing, or foreclosure, net of fees and costs which may be
incurred) may expose a Fund to a lower rate of return upon reinvestment of
principal. Also, if a security subject to prepayment has been purchased at a
premium, in the event of prepayment, the value of the premium would be lost.
Like other fixed-income securities, when interest rates rise, the value of a
mortgage-related security generally will decline; however, when interest rates
decline, the value of mortgage-related securities with prepayment features may
not increase as much as other fixed-income securities. For this and other
reasons, the stated maturity of a mortgage-related security may be shortened by
unscheduled prepayments on the underlying mortgages and, accordingly, it is not
possible to predict accurately the security's return to a Fund.

Like mortgages underlying mortgage-backed securities, automobile sales
contracts or credit card receivables underlying asset-backed securities are
subject to prepayment, which may reduce the overall return to certificate
holders. Nevertheless, principal prepayment rates tend not to vary much with
interest rates, and the short-term nature of the underlying car loans or other
receivables tends to dampen the impact of any change in the prepayment level.
Certificate holders may also experience delays in prepayment on the certificates
if the full amounts due on underlying sales contracts or receivables are not
realized because of unanticipated legal or administrative costs of enforcing the
contracts or because of depreciation or damage to the collateral (usually
automobiles) securing certain contracts, or other factors. In certain market
conditions, asset-backed securities may experience volatile fluctuations in
value and periods of illiquidity. If consistent with its investment objective
and policies, a Fund may invest in other asset-backed securities that may be
developed in the future.

The staff of the Securities and Exchange Commission is of the view that
certain issuers of asset-backed securities not complying with Securities and
Exchange Commission regulations are investment companies under the Investment
Company Act of 1940 (the "1940 Act"). The Funds intend to conduct their
operations in a manner consistent with this view and, among other things,
generally will not invest more than 10% (25% for the Money Funds) of their total
assets (when combined with investments in securities of other investment
companies, if any) in the obligations of such issuers without obtaining
appropriate regulatory relief.

BANKERS' ACCEPTANCES

The Funds may invest in bankers' acceptances guaranteed by domestic and
foreign banks if at the time of investment the guarantor bank has capital,
surplus, and undivided profits in excess of $100,000,000 (as of the date of its
most recently published financial statements).

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<PAGE>
CERTIFICATES OF DEPOSIT AND TIME DEPOSITS

The Funds may invest in certificates of deposit and time deposits of domestic
and foreign banks and savings and loan associations if (a) at the time of
investment the depository institution has capital, surplus, and undivided
profits in excess of $100,000,000 (as of the date of its most recently published
financial statements), or (b) the principal amount of the instrument is insured
in full by the Federal Deposit Insurance Corporation.

The Funds may also invest in ECDs, which are U.S. dollar denominated
certificates of deposit issued by offices of foreign and domestic banks located
outside the United States; ETDs, which are U.S. dollar denominated deposits in a
foreign branch of a U.S. bank or a foreign bank; CTDs, which are essentially the
same as ETDs, except they are issued by Canadian offices of major Canadian
banks; and Yankee CDs, which are certificates of deposit issued by a U.S. branch
of a foreign bank denominated in U.S. dollars and held in the United States.

None of the Money Funds will invest in excess of 10% of its net assets in time
deposits with maturities in excess of seven days which are subject to penalties
upon early withdrawal. Such time deposits include ETDs and CTDs but do not
include certificates of deposit.

COMMERCIAL PAPER

Each Income Fund, the Money Market Fund, and, within the limitations described
above, the U.S. Treasury Fund and Tax-Free Money Market Fund may invest in
short-term promissory notes issued by corporations (including variable amount
master demand notes) rated at the time of purchase within the two highest
categories assigned by an NRSRO (e.g., A-2 or better by S&P, Prime-2 or better
by Moody's or F-2 or better by Fitch) or, if not rated, found by Qualivest
pursuant to guidelines adopted by the Board of Trustees to be of comparable
quality to instruments that are so rated. The Equity Funds may invest in such
instruments if rated in the four highest categories assigned by an NRSRO or, if
not rated, found by Qualivest pursuant to guidelines adopted by the Board of
Trustees to be of comparable quality. Instruments may be purchased in reliance
upon a rating only when the rating organization is not affiliated with the
issuer or guarantor of the instrument. For a description of the rating symbols
of the NRSROs as used in this paragraph, see the Appendix to the Statement of
Additional Information. The Money Market Fund, the Equity Funds and the Income
Funds may also invest in Canadian Commercial Paper, which is commercial paper
issued by a Canadian corporation or a Canadian counterpart of a U.S.
corporation, and in Europaper, which is U.S. dollar denominated commercial paper
of a foreign issuer.

Each of the Funds may invest in variable amount master demand notes, which are
unsecured demand notes that permit the indebtedness thereunder to vary, and that
provide for periodic adjustments in the interest rate according to the terms of
the instrument. Because master demand notes are direct lending arrangements
between the Fund and the issuer, they are not normally traded. Although there is
no secondary market in the notes, the Funds may demand payment of principal and
accrued interest at any time. While the notes are not typically rated by credit
rating agencies, issuers of variable amount master demand notes (which are
normally manufacturing, retail, financial, and other business concerns) must
satisfy the same criteria as set forth above for commercial paper. Qualivest
will consider the earning power, cash flow, and other liquidity ratios of the
issuers of such notes and will continuously monitor their financial status and
ability to meet payment on demand. In determining average weighted portfolio
maturity, a variable amount master demand note will be deemed to have a maturity
equal to the period of time remaining until the principal amount can

24
<PAGE>
be recovered from the issuer through demand. The period of time remaining until
the principal amount can be recovered under a variable master demand note shall
not exceed seven days.

PUT AND CALL OPTIONS

Each Equity Fund and Income Fund may purchase put and call options on
securities, and each Equity Fund other than the Optimized Fund may purchase such
options on foreign currencies, subject to its applicable investment policies,
for the purposes of hedging against market risks related to its portfolio
securities and adverse movements in exchange rates between currencies,
respectively. Purchasing options is a specialized investment technique that
entails a substantial risk of a complete loss of the amounts paid as premiums to
writers of options. Each Fund may also engage in writing call options from time
to time as Qualivest deems appropriate. The Funds will write only covered call
options (options on securities or currencies owned by the particular Fund). In
order to close out a call option it has written, a Fund will enter into a
"closing purchase transaction"--the purchase of a call option on the same
security or currency with the same exercise price and expiration date as the
call option which such Fund previously has written. When a portfolio security or
currency subject to a call option is sold, the Fund will effect a closing
purchase transaction to close out any existing call option on that security or
currency. If such Fund is unable to effect a closing purchase transaction, it
will not be able to sell the underlying security or currency until the option
expires or that Fund delivers the underlying security or currency upon exercise.
In addition, upon the exercise of a call option by the holder thereof, the Fund
will forego the potential benefit represented by market appreciation over the
exercise price. Under normal conditions, it is not expected that a Fund will
cause the underlying value of portfolio securities and/or currencies subject to
such options to exceed 25% of its total assets.

A Fund, as part of its option transactions, also may purchase index put and
call options and write index options. As with options on individual securities,
a Fund will write only covered index call options. Through the writing or
purchase of index options a Fund can achieve many of the same objectives as
through the use of options on individual securities. Options on securities
indices are similar to options on a security except that, rather than the right
to take or make delivery of a security at a specified price, an option on a
securities index gives the holder the right to receive, upon exercise of the
option, an amount of cash if the closing level of the securities index upon
which the option is based is greater than, in the case of a call, or less than,
in the case of a put, the exercise price of the option.

Price movements in securities which a Fund owns or intends to purchase may not
correlate perfectly with movements in the level of an index and, therefore, a
Fund bears the risk of a loss on an index option that is not completely offset
by movements in the price of such securities. Because index options are settled
in cash, a call writer cannot determine the amount of its settlement obligations
in advance and, unlike call writing on specific securities, cannot provide in
advance for, or cover, its potential settlement obligations by acquiring and
holding the underlying securities. A Fund may be required to segregate assets or
provide an initial margin to cover index options that would require it to pay
cash upon exercise.

FOREIGN SECURITIES

25
<PAGE>
tion, limits on removal of currency or other assets, nationalization of assets,
foreign withholding and income taxation, and foreign trading practices
(including higher trading commissions, custodial charges and delayed
settlements). Such securities may be subject to greater fluctuations in price
than securities issued by U.S. corporations or issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. The markets on which such
securities trade may have less volume and liquidity, and may be more volatile
than securities markets in the U.S. In addition, there may be less publicly
available information about a foreign company than about a U.S. domiciled
company. Foreign companies generally are not subject to uniform accounting,
auditing and financial reporting standards comparable to those applicable to
U.S. domestic companies. There is generally less government regulation of
securities exchanges, brokers and listed companies abroad than in the U.S.
Confiscatory taxation or diplomatic developments could also affect investment in
those countries. In addition, foreign branches of U.S. banks, foreign banks and
foreign issuers may be subject to less stringent reserve requirements and to
different accounting, auditing, reporting, and recordkeeping standards than
those applicable to domestic branches of U.S. banks and U.S. domestic issuers.

If a security is denominated in foreign currency, the value of the security to
a Fund will be affected by changes in currency exchange rates and in exchange
control regulations, and costs will be incurred in connection with conversions
between currencies. Currency risks generally increase in lesser developed
markets. Exchange rate movements can be large and can endure for extended
periods of time, affecting either favorably or unfavorably the value of the
Funds' assets.

For many foreign securities, U.S. dollar denominated American Depositary
Receipts ("ADRs"), which are traded in the United States on exchanges or
over-the-counter, are issued by domestic banks. ADRs represent the right to
receive securities of foreign issuers deposited in a domestic bank or a
correspondent bank. ADRs do not eliminate all the risk inherent in investing in
the securities of foreign issuers. However, by investing in ADRs rather than
directly in foreign issuers' stock, an eligible Equity Fund can avoid currency
risks during the settlement period for either purchases or sales.

Subject to its applicable investment policies, each Equity Fund other than the
Optimized Fund may invest in debt securities denominated in the European
Currency Unit ("ECU"), which is a "basket" consisting of specified amounts of
the currencies of certain of the twelve member states of the European Community.
The specific amounts of currencies comprising the ECU may be adjusted by the
Council of Ministers of the European Community to reflect changes in relative
values of the underlying currencies. Such adjustments may adversely affect
holders of ECU denominated obligations or the marketability of such securities.

FOREIGN CURRENCY TRANSACTIONS

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<PAGE>
directly between currency traders (usually large commercial banks) and their
customers. The Equity Funds may enter into forward currency contracts in order
to hedge against adverse movements in exchange rates between currencies.

By entering into a forward currency contract in U.S. dollars for the purchase
or sale of the amount of foreign currency involved in an underlying security
transaction, a Fund is able to protect itself against a possible loss between
trade and settlement dates resulting from an adverse change in the relationship
between the U.S. dollar and such foreign currency. However, this tends to limit
potential gains which might result from a positive change in such currency
relationships. An Equity Fund may also hedge its foreign currency exchange rate
risk by engaging in currency financial futures and options transactions. The
forecasting of short-term currency market movements is extremely difficult and
whether such a short-term hedging strategy will be successful is highly
uncertain.

It is impossible to forecast with precision the market value of portfolio
securities at the expiration of a forward currency contract. Accordingly, it may
be necessary for an Equity Fund to purchase additional currency on the spot
market (and bear the expense of such purchase) if the market value of the
security is less than the amount of foreign currency such Fund is obligated to
deliver when a decision is made to sell the security and make delivery of the
foreign currency in settlement of a forward contract. Conversely, it may be
necessary to sell on the spot market some of the foreign currency received upon
the sale of the portfolio security if its market value exceeds the amount of
foreign currency such Fund is obligated to deliver.

If an Equity Fund retains the portfolio security and engages in an offsetting
transaction, the Fund will incur a gain or a loss to the extent that there has
been movement in forward currency contract prices. If the Fund engages in an
offsetting transaction, it may subsequently enter into a new forward currency
contract to sell the foreign currency. Although such contracts tend to minimize
the risk of loss due to a decline in the value of the hedged currency, they also
tend to limit any potential gain which might result should the value of such
currency increase. The Funds will have to convert their holdings of foreign
currencies into U.S. dollars from time to time. Although foreign exchange
dealers do not charge a fee for conversion, they do realize a profit based on
the difference (the "spread") between the prices at which they are buying and
selling various currencies.

For further information about the characteristics, risks and possible benefits
of options, foreign securities and foreign currency transactions, see
"INVESTMENT OBJECTIVES AND POLICIES--Additional Information on Portfolio
Instruments" in the Statement of Additional Information.

REPURCHASE AGREEMENTS

Securities held by a Fund (other than the U.S. Treasury Fund) may be subject
to repurchase agreements. Under the terms of a repurchase agreement, a Fund
would acquire securities from financial institutions, subject to the seller's
agreement to repurchase such securities at a mutually agreed upon date and
price, which includes interest negotiated on the basis of current short-term
rates. The seller under a repurchase agreement will be required to maintain at
all times the value of collateral held pursuant to the agreement at not less
than the repurchase price (including accrued interest). If a seller defaults on
its repurchase obligation, a Fund may suffer a loss in disposing of the security
subject to the repurchase agreement. For further information about repurchase
agreements, see "INVESTMENT OBJECTIVES AND POLICIES--Additional Information on
Portfolio Instruments--Repurchase Agreements" in the Statement of Additional
Information.

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<PAGE>
REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLL AGREEMENTS

Each of the Funds may also borrow funds by entering into reverse repurchase
agreements and dollar roll agreements in accordance with applicable investment
restrictions. Pursuant to such agreements, a Fund would sell certain of its
securities to financial institutions such as banks and broker-dealers, and agree
to repurchase them, or substantially similar securities in the case of a dollar
roll agreement, at a mutually agreed upon date and price. A dollar roll
agreement is identical to a reverse repurchase agreement except for the fact
that substantially similar securities may be repurchased. At the time a Fund
enters into a reverse repurchase agreement or dollar roll agreement, it will
place in a segregated custodial account assets such as U.S. Government
securities or other liquid high grade debt securities consistent with its
investment restrictions having a value equal to the repurchase price (including
accrued interest), and will subsequently continually monitor the account to
ensure that such equivalent value is maintained at all times. Reverse repurchase
agreements and dollar roll agreements involve the risk that the market value of
securities sold by a Fund may decline below the price at which it is obligated
to repurchase the securities.

FUTURES CONTRACTS

The Equity Funds and the Income Funds may also enter into contracts for the
future delivery of securities or foreign currencies and futures contracts based
on a specific security, class of securities, foreign currency or an index,
purchase or sell options on any such futures contracts and engage in related
closing transactions. A futures contract on a securities index is an agreement
obligating either party to pay, and entitling the other party to receive, while
the contract is outstanding, cash payments based on the level of a specified
securities index.

A Fund may engage in such futures contracts in an effort to hedge against
market risks and to manage its cash position, but not for leveraging purposes.
For example, when interest rates are expected to rise or market values of
portfolio securities are expected to fall, a Fund can seek through the sale of
futures contracts to offset a decline in the value of its portfolio securities.
When interest rates are expected to fall or market values are expected to rise,
a Fund, through the purchase of such contracts, can attempt to secure better
rates or prices for the Fund than might later be available in the market when it
effects anticipated purchases.

Aggregate initial margin deposits for futures contracts, and premiums paid for
related options, may not exceed 5% of a Fund's total assets, and the value of
securities that are the subject of such futures and options (both for receipt
and delivery) may not exceed 33 1/3% of the market value of a Fund's total
assets. Futures transactions will be limited to the extent necessary to maintain
each Fund's qualification as a regulated investment company.

WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS

28
<PAGE>
ment in a segregated account. Securities purchased on a when-issued basis are
recorded as an asset and are subject to changes in value based upon changes in
the general level of interest rates. In when-issued and delayed-delivery
transactions, a Fund relies on the seller to complete the transaction; the
seller's failure to do so may cause such Fund to miss a price or yield
considered to be advantageous.

LENDING OF PORTFOLIO SECURITIES

In order to generate additional income, the Equity Funds and the Income Funds
from time to time may lend portfolio securities to broker-dealers, banks or
institutional borrowers of securities. The Funds must receive 102% collateral in
the form of cash or U.S. Government securities. This collateral must be valued
daily by Qualivest and, should the market value of the loaned securities
increase, the borrower must furnish additional collateral to the Funds. During
the time portfolio securities are on loan, the borrower pays the Funds any
dividends or interest paid on such securities. Loans are subject to termination
by the Funds or the borrower at any time. While the Funds do not have the right
to vote securities on loan, they intend to terminate the loan and regain the
right to vote if that is considered important with respect to the investment. In
the event the borrower defaults on its obligation to a Fund, the Fund could
experience delays in recovering its securities and possible capital losses. The
Funds will only enter into loan arrangements with broker-dealers, banks or other
institutions which Qualivest has determined to be creditworthy under guidelines
established by the Board of Trustees that permit each Fund to loan up to 33 1/3%
of the value of its total assets.

MEDIUM-GRADE SECURITIES

As described above, each of the Income Funds, the Large Companies Fund and the
Small Companies Fund may invest up to 10% of its total assets in debt securities
within the fourth highest rating group assigned by an NRSRO (i.e., BBB or Baa by
S&P and Moody's, respectively) and comparable unrated securities. These types of
debt securities are considered by Moody's and S&P to have some speculative
characteristics, and are more vulnerable to changes in economic conditions,
higher interest rates or adverse issuer-specific developments which are more
likely to lead to a weaker capacity to make principal and interest payments than
comparable higher rated debt securities.

Should subsequent events cause the rating of a debt security purchased by a
Fund to fall below BBB or Baa, as the case may be, Qualivest will consider such
an event in determining whether the Fund should continue to hold that security.
In no event, however, would a Fund be required to liquidate any such portfolio
security where the Fund would suffer a loss on the sale of such security.

SECURITIES ISSUED BY OTHER INVESTMENT COMPANIES

Each of the Equity and Income Funds may invest up to 10% of its total assets,
and each of the Money Funds may invest up to 25% of its total assets, in shares
of money market mutual funds for cash management purposes. The U.S. Treasury
Fund expects to make such purchases only in money market funds that restrict
their investments to U.S. Government securities. A Fund will incur additional
expenses due to the duplication of expenses as a result of investing in other
investment companies.

RESTRICTED SECURITIES

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<PAGE>
registration which is afforded by Section 4(2) of the 1933 Act ("Section 4(2)
securities"). Section 4(2) securities are restricted as to disposition under the
federal securities laws, and generally are sold to institutional investors such
as the Funds who agree that they are purchasing the securities for investment
and not with a view to public distribution. Any resale must also generally be
made in an exempt transaction. Section 4(2) securities are normally resold to
other institutional investors through or with the assistance of the issuer or
investment dealers who make a market in such Section 4(2) securities, thus
providing liquidity. Pursuant to procedures adopted by the Board of Trustees of
the Trust, Qualivest may determine Section 4(2) securities to be liquid if such
securities are readily marketable. These securities may include securities
eligible for resale under Rule 144A under the 1933 Act.

PRIVATE ACTIVITY BONDS

The Tax-Free Money Market Fund may also invest in private activity bonds. It
should be noted that the Tax Reform Act of 1986 substantially revised provisions
of prior federal law affecting the issuance and use of proceeds of certain
tax-exempt obligations. A new definition of private activity bonds applies to
many types of bonds, including those which were industrial development bonds
under prior law. Interest on private activity bonds is tax-exempt (and such
bonds will be considered Municipal Securities for purposes of this Prospectus)
only if the bonds fall within certain defined categories of qualified private
activity bonds and meet the requirements specified in those respective
categories. If the Fund invests in private activity bonds which fall outside
these categories, the interest from such bonds will not be exempt from federal
income tax. The Tax Reform Act generally does not change the federal tax
treatment of bonds issued to finance government operations. For further
information relating to the types of private activity bonds which will be
included in income subject to the alternative minimum tax, see "ADDITIONAL
INFORMATION--Additional Tax Information" in the Statement of Additional
Information.

MUNICIPAL SECURITIES

The Tax-Free Money Market Fund will invest only in those Municipal Securities
which are considered by Qualivest to present minimal credit risks and which at
the time of purchase are rated high quality by an NRSRO (e.g., rated "AA" or
higher by S&P or "Aa" or higher by Moody's in the case of bonds; rated "SP-2" or
higher by S&P or "MIG-2" or higher by Moody's in the case of notes; rated
"VMIG-2" or higher by Moody's in the case of variable rate demand notes; and
rated "A-2" or higher by S&P or "Prime-2" or higher by Moody's in the case of
tax-exempt commercial paper) or which are unrated at the time of purchase but
are determined to be of comparable quality by Qualivest pursuant to guidelines
approved by the Trust's Board of Trustees. Municipal Securities may be purchased
in reliance upon a rating only where the rating organization is not affiliated
with the issuer or guarantor of the Municipal Securities. If a security is
subject to a demand feature, the security must receive both a short-term and a
long-term high quality rating or must be determined to be of comparable quality
by Qualivest; except that where the demand feature is considered to be
"unconditional" under the 1940 Act, the security may be acquired solely in
reliance on a short-term high quality rating or a determination of comparable
quality by Qualivest of the unconditional demand feature. The applicable
Municipal Securities ratings are described in the Appendix to the Statement of
Additional Information.

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<PAGE>
credit and taxing power for the payment of principal and interest. Revenue
securities are payable only from the revenues derived from a particular facility
or class of facilities or, in some cases, from the proceeds of a special excise
tax or other specific revenue source such as the user of the facility being
financed.

Private activity bonds held by the Fund are in most cases revenue securities
and are not payable from the unrestricted revenues of the issuer. Consequently,
the credit quality of private activity bonds is usually directly related to the
credit standing of the corporate user of the facility involved.

Municipal Securities in which the Fund may invest may also include "moral
obligation" bonds, which are normally issued by special purpose public
authorities. If the issuer of moral obligation bonds is unable to meet its debt
service obligations from current revenues, it may draw on a reserve fund, the
restoration of which is a moral commitment but not a legal obligation of the
state or municipality which created the issuer.

Municipal Securities purchased by the Tax-Free Money Market Fund may include
rated and unrated variable and floating rate tax-exempt notes, which may have a
stated maturity in excess of 397 days but which will, in such event, be subject
to a demand feature that will permit the Fund to demand payment of the principal
of the note either (i) at any time upon not more than thirty days' notice or
(ii) at specified intervals not exceeding 397 days and upon no more than thirty
days' notice. There may be no active secondary market with respect to a
particular variable or floating rate note. Nevertheless, the periodic
readjustments of their interest rates tend to assure that their value to the
Fund will approximate their par value. Variable and floating rate notes for
which no readily available market exists will be purchased in an amount which,
together with other illiquid securities, exceeds 10% of the Tax-Free Money
Market Fund's net assets only if such notes are subject to a demand feature that
will permit the Fund to receive payment of the principal within seven days after
demand by the Fund.

The Fund may acquire zero coupon obligations, which have greater price
volatility than coupon obligations and which will not result in the payment of
interest until maturity.

The Fund may also purchase Municipal Securities on a "when-issued" basis.
"When-issued" securities are securities purchased for delivery beyond the normal
settlement date at a stated price and yield, thereby involving the risk that the
yield obtained in the transaction will be less than that available in the market
when delivery takes place. The Fund will not pay for such securities, and no
income accrues on the securities, until they are received. Securities purchased
on a "when-issued" basis are recorded as an asset and are subject to changes in
value based upon changes in the general level of interest rates. The Tax-Free
Money Market Fund's commitments to purchase "when-issued" securities will not
exceed 25% of the value of its total assets under normal market conditions, and
a commitment by the Fund to purchase "when-issued" securities will not exceed 60
days.

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<PAGE>
Examples of such securities are obligations the repayment of which is dependent
upon similar types of projects or projects located in the same state. Such
investments would be made only if deemed necessary or appropriate by Qualivest.
To the extent that the Fund's assets are concentrated in Municipal Securities
that are so related, the Fund will be subject to the peculiar risks presented by
such Municipal Securities, such as negative developments in a particular
industry or state, to a greater extent than it would be if the Fund's assets
were not so concentrated.

PUTS

The Tax-Free Money Market Fund may acquire "puts" with respect to Municipal
Securities held in its portfolio. Under a put, the Fund would have the right to
sell a specified Municipal Security within a specified period of time at a
specified price. A put would be sold, transferred, or assigned only with the
underlying Municipal Security. The Fund will acquire puts solely to either
facilitate portfolio liquidity, shorten the maturity of the underlying Municipal
Securities, or permit the investment of the Fund's assets at a more favorable
rate of return. The aggregate price of a security subject to a put may be higher
than the price which otherwise would be paid for the security without such an
option, thereby increasing the security's cost and reducing its yield.

VALUATION OF SHARES

The net asset value of each Equity Fund and Income Fund is determined and its
Shares are priced as of the close of regular trading on the New York Stock
Exchange ("NYSE") (generally 1:00 p.m. Pacific Time) on each Business Day
("Valuation Time"). The net asset value of each Money Fund is determined and its
Shares are priced as of 11:30 a.m. Pacific Time and as of the close of regular
trading on the NYSE on each Business Day (also "Valuation Times"). As used
herein a "Business Day" is a day on which the NYSE is open for trading, the
Federal Reserve Bank of San Francisco is open, and any other day except days on
which there are insufficient changes in the value of a Fund's portfolio
securities to materially affect the Fund's net asset value or days on which no
Shares are tendered for redemption and no order to purchase any Shares is
received. Currently, the NYSE or the Federal Reserve Bank of San Francisco is
closed on the following holidays: New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Columbus Day, Veteran's Day, Thanksgiving and Christmas.

Net asset value per Share for a particular class for purposes of pricing sales
and redemptions is calculated by dividing the value of all securities and other
assets belonging to a Fund allocable to such class, less the liabilities charged
to that Fund allocable to such class and any liabilities charged directly to
that class, by the number of outstanding Shares of such class.

The net asset value per Share of the Equity Funds and the Income Funds will
fluctuate as the value of the investment portfolio of each such Fund changes.

The securities in each Equity Fund and Income Fund will be valued at market
value. If market quotations are not available, the securities will be valued by
a method which the Board of Trustees believes accurately reflects fair value.
The assets in each Money Fund are valued based upon the amortized cost method.
For further information about valuation of investments, see "NET ASSET VALUE" in
the Statement of Additional Information.

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<PAGE>
PURCHASING SHARES

Class A and Class C Shares may be purchased directly from the Distributor, or
through a broker-dealer who has established a dealer agreement with the
Distributor. Except as otherwise discussed below under "Other Information
Regarding Purchases" and "Auto Invest Plan," the minimum initial investment in a
Fund, based upon the public offering price, is $500 ($50 in the case of an
Individual Retirement Account ("IRA")), and there is a $100 minimum ($50 for an
IRA) for subsequent purchases. Shareholders will pay the next calculated public
offering price after the receipt by the Distributor of an order to purchase
Shares, plus any applicable sales charge as described below (see "SALES CHARGES
ON THE EQUITY AND INCOME FUNDS").

BY MAIL

To purchase Class A or Class C Shares of any of the Funds by mail, complete an
Account Application Form and return it along with a check or money order made
payable to Qualivest Funds at the following address: P. O. Box 3205, Portland,
Oregon 97208 .

An Account Application Form can be obtained by calling the Trust at
1-800-743-8637.

BY TELEPHONE OR BY WIRE

To purchase Class A or Class C Shares of any of the Funds by telephone or by
wire, your Account Application Form must have been previously received by the
Distributor. To place an order by telephone or by wire, call the Trust's
toll-free number 1-800-743-8637. Payment for Class A or Class C Shares ordered
by telephone may be made by check or electronic transfer and must be received by
the Custodian within the settlement requirements defined in the Securities
Exchange Act of 1934 (the "1934 Act"). An order to purchase Shares of a Money
Fund will be deemed to have been received by the Distributor only when federal
funds with respect thereto are available to the Fund's Custodian for investment.
If payment for the Shares is not received within the prescribed time periods, or
if a check timely received does not clear, the purchase will be cancelled and
the investor could be liable for any losses or fees incurred. Any questions
regarding current settlement requirements or electronic payment instructions
should be directed to the Trust at 1-800-743-8637. When purchasing Class A or
Class C Shares by wire, contact the Trust for wire instructions.

OTHER INFORMATION REGARDING PURCHASES

Purchases of Shares of the Funds will be executed at the next calculated net
asset value per Share following the receipt by the Trust of an order to purchase
Shares in good form ("public offering price"). In the case of orders for the
purchase of Shares placed through a broker-dealer, the applicable public
offering price will be the net asset value as so determined, but only if the
Distributor receives the order prior to the next Valuation Time for that day and
transmits it to the Trust by that Valuation Time. The broker-dealer is
responsible for transmitting such orders promptly. If the broker-dealer fails to
do so, the investor's right to that day's closing price must be settled between
the investor and the broker-dealer. Purchases of Shares of any of the Funds will
be effected only on a Business Day of the Funds. An order received prior to a
Valuation Time on any Business Day will be executed at the net asset value
determined as of the next Valuation Time on the date of receipt. An order
received after the final Valuation Time on any Business Day will be executed at
the net asset value determined as of the next Valuation Time on the next
Business Day of that Fund. Shares of the Money Funds purchased before 11:30 a.m.
Pacific Time begin earning dividends on the same Business Day. Shares of the
Money Funds

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<PAGE>
purchased after 11:30 a.m. Pacific Time begin earning dividends on the next
Business Day. All Shares of the Money Funds continue to earn dividends through
the day before their redemption.

The minimum initial investment amount and subsequent investment amount
referred to above may be waived if purchases are made in connection with payroll
deductions, IRAs, Keogh or similar plans and for so-called "sweep" arrangements
where an investor's cash assets are periodically transferred from an account
into one of the Funds. For information on IRAs, Keogh or similar plans, contact
the Trust at 1-800-743-8637.

The Trust reserves the right to reject any order for the purchase of its
Shares in whole or in part, including purchases made through the use of third
party checks and drafts drawn on foreign financial institutions.

Depending on the terms of an investor's account, an investor may be charged a
fee in connection with transactions in Shares effected through a broker or other
agent. This Prospectus should be read in conjunction with information regarding
the terms of such an account.

Every Shareholder will receive a confirmation of, or account statement
reflecting, each new transaction in the Shareholder's account, which will also
show the total number of Shares of the respective Fund owned by the Shareholder.
Shareholders may rely on these statements in lieu of certificates. Certificates
representing Shares of the Funds will not be issued.

AUTO INVEST PLAN

The Qualivest Funds Auto Invest Plan enables Shareholders to make regular
monthly, bi-monthly or quarterly purchases of Class A or Class C Shares through
automatic deduction from their bank accounts (as long as the Shareholder's bank
is a member of the Automated Clearing House). With Shareholder authorization,
the Trust's Transfer Agent will deduct the amount specified (subject to the
applicable minimums) from the Shareholder's bank account, which amount will
automatically be invested in Shares at the public offering price on the fifth
and/or the twentieth day of such month or quarter (or the next Business Day
thereafter). The required minimum initial investment for opening an account
using the Auto Invest Plan is $50; the minimum amount for subsequent investments
in a Fund is $50. To participate in the Auto Invest Plan, Shareholders should
complete the appropriate section of the Account Application Form or a
supplemental Auto Invest application that can be acquired by calling the Trust
at 1-800-743-8637. For a Shareholder to change the Auto Invest instructions, the
request must be made in writing to the Trust's Distributor, BISYS Fund Services,
3435 Stelzer Road, Columbus, Ohio 43219-3035 and may take up to 15 days to
implement.

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<PAGE>
SALES CHARGES ON THE EQUITY AND INCOME FUNDS

CLASS A SHARES

The public offering price of Class A Shares of the Equity Funds equals net
asset value plus the applicable sales charge. BISYS receives this sales charge
as Distributor and may reallow it as dealer discounts and brokerage commissions
as follows:

SALES CHARGE AS:
-------------------
SIZE OF % OF % OF NET
TRANSACTION OFFERING AMOUNT DEALER
AT OFFERING PRICE PRICE INVESTED REALLOWANCE
- ------------------ -------- -------- -----------
Less than
$50,000........... 4.50% 4.71% 4.05%
$50,000 but less
than $100,000..... 3.75% 3.90% 3.375%
$100,000 but less
than $250,000..... 2.50% 2.56% 2.25%
$250,000 but less
than $500,000..... 2.00% 2.04% 1.80%
$500,000 but less
than $1,000,000... 1.00% 1.01% 0.90%
$1,000,000 and
over.............. 0.00% 0.00% 0.00%

The public offering price of Class A Shares of the Income Funds equals net
asset value plus the applicable sales charge. BISYS receives this sales charge
as Distributor and may reallow it as dealer discounts and brokerage commissions
as follows:

SALES CHARGE AS:
-------------------
SIZE OF % OF % OF NET
TRANSACTION OFFERING AMOUNT DEALER
AT OFFERING PRICE PRICE INVESTED REALLOWANCE
- ------------------ -------- -------- -----------
Less than
$50,000........... 3.50% 3.63% 3.15%
$50,000 but less
than $100,000..... 2.75% 2.83% 2.475%
$100,000 but less
than $250,000..... 2.00% 2.04% 1.80%
$250,000 but less
than $500,000..... 1.50% 1.52% 1.35%
$500,000 but less
than $1,000,000... 1.00% 1.01% 0.90%
$1,000,000 and
over.............. 0.00% 0.00% 0.00%

An investor may obtain reduced sales charges on Class A Shares under the
circumstances described below under "Reduced Sales Charges--Class A Shares."

CLASS C SHARES

Class C Shares of the Equity Funds and the Income Funds may be purchased for
individual accounts only in amounts of less than $500,000. There is no sales
charge imposed upon purchases of Class C Shares, but investors may be subject to
a CDSC of 1.00% when Class C Shares are redeemed less than one year after
purchase. See "Contingent Deferred Sales Charge ("CDSC")--Class C Shares" below.

OTHER INFORMATION

The Distributor, at its expense, will also provide additional compensation to
dealers in connection with sales of Shares of any of the Funds. Such
compensation will include financial assistance to dealers in connection with
conferences, sales or training programs for their employees, seminars for the
public, advertising campaigns regarding one or more of the Funds, and/or other
dealer-sponsored special events. In some instances, this compensation will be
made available only to certain dealers whose representatives have sold a
significant amount of such Shares. Compensation may include payment for travel
expenses, including lodging, to various locations for meetings or seminars of a
business nature. Compensation may also include the following types of non-cash
compensation offered through promotional contests: (1) travel and lodging at
vacation locations; (2) tickets for entertainment events; and (3) merchandise.
None of the aforementioned compensation is paid for by any Fund or its
Shareholders.

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<PAGE>
REDUCED SALES CHARGES--CLASS A SHARES

SALES CHARGE WAIVERS

The Distributor may waive sales charges for the purchase of Class A Shares of
an Equity Fund or an Income Fund by or on behalf of (1) purchasers for whom U.S.
Bank or one of its affiliates acts in a fiduciary, advisory, custodial or
similar capacity, (2) employees and retired employees (including spouses,
children and parents of employees and retired employees) of U.S. Bank, BISYS and
any affiliates thereof, (3) Trustees of the Trust, (4) directors and retired
directors (including spouses and children of directors and retired directors) of
U.S. Bank and any affiliates thereof, (5) purchasers who use proceeds from an
account for which U.S. Bank or one of its affiliates acts in a fiduciary,
advisory, custodial or similar capacity, to purchase Class A Shares of a Fund,
(6) brokers, dealers and agents who have a sales agreement with the Distributor,
and their employees (and the immediate family members of such individuals), (7)
investment advisers or financial planners that have entered into an agreement
with the Distributor and that place trades for their own accounts or the
accounts of eligible clients and that charge a fee for their services, and
clients of such investment advisers or financial planners who place trades for
their own accounts if such accounts are linked to the master account of the
investment adviser or financial planner on the books and records of a broker or
agent that has entered into an agreement with the Distributor, and (8) orders
placed on behalf of other investment companies distributed by BISYS, The BISYS
Group, Inc., or their affiliated companies. In addition, the Distributor may
waive sales charges for the purchase of a Fund's Class A Shares with the
proceeds from the recent redemption of shares of a non-money market mutual fund
(except one of the other funds of the Trust) sold with a sales charge. The
purchase must be made within 60 days of the redemption, and the Distributor must
be notified in writing by the investor, or by his or her financial institution,
at the time the purchase is made. A copy of the investor's account statement
showing such redemption must accompany such notice. To receive a sales charge
waiver in conjunction with any of the above categories, Shareholders must, at
the time of purchase, give the Transfer Agent or the Distributor sufficient
information to permit confirmation of qualification.

SENIOR CITIZENS DISCOUNT

Effective January 1, 1996, the Distributor may offer a 10% reduction of sales
charges for the purchase of Class A Shares of an Equity Fund or an Income Fund
by or on behalf of a purchaser who has attained the age of 59 1/2 years. Any
such reduction also will apply to purchases made through the Auto Invest Plan.
To receive this sales charge reduction, Share- holders must, at the time of
purchase, give the Transfer Agent or the Distributor sufficient information to
permit confirmation of qualifica- tion. BISYS will receive a sale charge on
sales of the Equity Funds and may reallow it as dealer discounts and brokerage
commissions as follows:

SALES CHARGE AS
-------------------
SIZE OF % OF % OF NET
TRANSACTION OFFERING AMOUNT DEALER
AT OFFERING PRICE PRICE INVESTED REALLOWANCE
- ------------------ -------- -------- -----------
Less than
$50,000........... 4.05% 4.22% 3.65%
$50,000 but less
than $100,000..... 3.38% 3.49% 3.04%
$100,000 but less
than $250,000..... 2.25% 2.30% 2.03%
$250,000 but less
than $500,000..... 1.80% 1.83% 1.62%
$500,000 but less
than $1,000,000... 0.90% 0.91% 0.81%
$1,000,000 and
over.............. 0.00% 0.00% 0.00%

BISYS also will receive a sales charge on sales of the Income Funds and may
reallow it as dealer discounts and brokerage commissions as follows:

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<PAGE>

SALES CHARGE AS
-------------------
SIZE OF % OF % OF NET
TRANSACTION OFFERING AMOUNT DEALER
AT OFFERING PRICE PRICE INVESTED REALLOWANCE
- ------------------ -------- -------- -----------
Less than
$50,000........... 3.15% 3.25% 2.84%
$50,000 but less
than $100,000..... 2.48% 2.54% 2.23%
$100,000 but less
than $250,000..... 1.80% 1.83% 1.62%
$250,000 but less
than $500,000..... 1.35% 1.37% 1.22%
$500,000 but less
than $1,000,000... 0.90% 0.91% 0.81%
$1,000,000 and
over.............. 0.00% 0.00% 0.00%

CONCURRENT PURCHASES

For purposes of qualifying for a lower sales charge, investors have the
privilege of combining "concurrent purchases" of Class A Shares of an Equity
Fund or an Income Fund. For example, if a shareholder concurrently purchases
Class A Shares in one of the funds of the Trust sold with a sales charge at the
total public offering price of $25,000 and Class A Shares in another fund sold
with a sales charge at the total public offering price of $75,000, the sales
charge would be that applicable to a $100,000 purchase as shown in the
appropriate table above. The investor's "concurrent purchases" described above
shall include the combined purchases of the investor, the investor's spouse and
children under the age of 21 and the purchaser's retirement plan accounts. To
receive the applicable public offering price pursuant to this privilege,
Shareholders must, at the time of purchase, give the Transfer Agent or the
Distributor sufficient information to permit confirmation of qualification. This
privilege, however, may be modified or eliminated at any time or from time to
time by the Trust without notice.

LETTERS OF INTENT

An investor may obtain a reduced sales charge by means of a written Letter of
Intent which expresses the intention of such investor to purchase Class A Shares
of an Equity Fund or an Income Fund at a designated total public offering price
within a designated 13-month period. Each purchase of Class A Shares under a
Letter of Intent will be made at the net asset value plus the sales charge
applicable at the time of such purchase to a single transaction of the total
dollar amount indicated in the Letter of Intent (the "Applicable Sales Charge").
A Letter of Intent may include purchases of Class A Shares made not more than 90
days prior to the date such investor signs a Letter of Intent; however, the
13-month period during which the Letter of Intent is in effect will begin on the
date of the earliest purchase to be included. An investor will receive as a
credit against his/her purchase(s) of Shares during this ninety day period at
the end of the 13-month period, the difference, if any, between the sales load
paid on previous purchases qualifying under the Letter of Intent and the
Applicable Sales Charge.

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<PAGE>

paid. When the full amount indicated has been purchased, the escrow will be
released. To the extent that an investor purchases more than the dollar amount
indicated in the Letter of Intent and qualifies for a further reduced sales
charge, the sales charge will be adjusted for the entire amount purchased at the
end of the 13-month period. The difference in sales charge will be used to
purchase additional Class A Shares of such Fund at the then current public
offering price subject to the rate of sales charge applicable to the actual
amount of the aggregate purchases. For further information about Letters of
Intent, interested investors should contact the Trust at 1-800-743-8637. This
program, however, may be modified or eliminated at any time or from time to time
by the Trust without notice.

RIGHTS OF ACCUMULATION

Pursuant to the right of accumulation, investors are permitted to purchase
Class A Shares of the Equity Funds and the Income Funds at the public offering
price applicable to the total of (a) the total public offering price of the
Class A Shares of the Fund then being purchased plus (b) an amount equal to the
then current net asset value of the "purchaser's combined holdings" of the Class
A Shares of all of the funds of the Trust sold with a sales charge. Class A
Shares sold to purchasers for whom U.S. Bank or one of its affiliates acts in a
fiduciary, advisory, custodial (other than retirement accounts), agency, or
similar capacity are not presently subject to a sales charge. The "purchaser's
combined holdings" described above shall include the combined holdings of the
purchaser, the purchaser's spouse and children under the age of 21 and the
purchaser's retirement plan accounts. To receive the applicable public offering
price pursuant to the right of accumulation, Shareholders must, at the time of
purchase, give the Transfer Agent or the Distributor sufficient information to
permit confirmation of qualification. This right of accumulation, however, may
be modified or eliminated at any time or from time to time by the Trust without
notice.

CONTINGENT DEFERRED SALES CHARGE ("CDSC")-- CLASS C SHARES

Class C Shares of the Equity Funds and the Income Funds which are redeemed
less than one year after purchase will be subject to a CDSC equal to one percent
of an amount equal to the lesser of the net asset value at the time of purchase
of the Class C Shares being redeemed or the net asset value of such Shares at
the time of redemption. Accordingly, a CDSC will not be imposed on amounts
representing increases in net asset value above the net asset value at the time
of purchase. In addition, a CDSC will not be assessed on Class C Shares
purchased through reinvestment of dividends or capital gains distributions, or
that are purchased by "Institutional Investors" such as corporations, pension
plans, foundations, charitable institutions, insurance companies, banks and
other banking institutions, and non-bank fiduciaries.

Solely for purposes of determining the amount of time which has elapsed from
the time of purchase of any Class C Shares, all purchases during a month will be
aggregated and deemed to have been made on the last day of the month. In
determining whether a CDSC is applicable to a redemption, the calculation will
be made in the manner that results in the lowest possible charge being assessed.
In this regard, it will be assumed that the redemption is first of Shares held
for more than one year or Shares acquired pursuant to reinvestment of dividends
or distributions.

For example, assume an investor purchased 100 Class C Shares with a net asset
value of $10 per Share (i.e., at an aggregate net asset value of $1,000) and in
the eleventh month after purchase, the net asset value per Share is $12 and,
during such time, the investor has acquired

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five additional Class C Shares through dividend reinvestment. If at such time
the investor makes his first redemption of 50 Class C Shares (producing proceeds
of $600), five of such Shares will not be subject to the charge because of
dividend reinvestment. With respect to the remaining 45 Class C Shares being
redeemed, the charge will be applied only to the original cost of $10 per Share
and not to the increase in net asset value of $2 per Share.

The CDSC is waived on redemptions of Class C Shares (i) following the death or
disability (as defined in the Internal Revenue Code of 1986, as amended (the
"Code")) of a Shareholder, (ii) to the extent that the redemption represents a
minimum required distribution from an IRA or a Custodial Account under Code
Section 403(b)(7) to a Shareholder who has reached age 70 1/2, and (iii) to the
extent the redemption represents the minimum distribution from retirement plans
under Code Section 401(a) where such redemptions are necessary to make
distributions to plan participants.

FACTORS TO CONSIDER WHEN SELECTING CLASS A SHARES OR CLASS C SHARES OF THE
EQUITY FUNDS AND THE INCOME FUNDS

Before purchasing Class A Shares or Class C Shares of an Equity Fund or an
Income Fund, investors should consider whether, during the anticipated life of
their investment in the Fund, the accumulated Rule 12b-1 fees and potential CDSC
on Class C Shares would be less than the initial sales charge and accumulated
Rule 12b-1 fees on Class A Shares purchased at the same time, and to what extent
such differential would be offset by the higher yield of Class A Shares. In this
regard, to the extent that the sales charge for the Class A Shares is waived or
reduced by one of the methods described above, investments in Class A Shares
become more desirable. The Trust will refuse all purchase orders for individual
accounts for Class C Shares of over $500,000.

Although Class A Shares are subject to a Rule 12b-1 fees, they are not subject
to the higher Rule 12b-1 fees applicable to Class C Shares. For this reason,
Class A Shares can be expected to pay correspondingly higher dividends per
Share. However, because initial sales charges are deducted at the time of
purchase, purchasers of Class A Shares that do not qualify for waivers of or
reductions in the initial sales charge would have less of their purchase price
initially invested in a Fund than purchasers of Class C Shares. See "MANAGEMENT
OF THE TRUST--Distributor" in the Statement of Additional Information.

EXCHANGE PRIVILEGE

The exchange privilege enables Shareholders of Class A or C Shares of the
Funds (including Shares acquired through reinvestment of dividends and
distributions on such Shares) to exchange those Shares at net asset value
without any sales charge for Shares of the same class offered with the same or
lower sales charge by any of the Trust's other funds, provided that the amount
to be exchanged meets the applicable minimum investment requirements and the
exchange is made in states where it is legally authorized. Exchanges for Shares
of one of the Trust's other funds with a higher sales charge may be made upon
payment of the sales charge differential. Holders of a Fund's Class C Shares may
not exchange their Shares for Class A, Class Q or Class Y Shares, and holders of
a Fund's Class A Shares may not exchange their Shares for Class C, Class Q or
Class Y Shares. An exchange of Class C Shares will not affect the holding period
of the Shares for purposes of the CDSC.

Except as otherwise provided below, Class A Shares of the Money Funds may not
be exchanged for Class A Shares of another fund of the Trust sold with a sales
charge but may be redeemed and reinvested in such fund upon
pay-

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ment of the appropriate sales charge. If, however, Class A Shares of a Money
Fund were acquired by a previous exchange from Class A Shares of a fund with
respect to which a sales charge had been paid, then such Class A Shares of the
Money Fund may be exchanged for Class A Shares of the other fund with a sales
charge without payment of any fees or sales charge. Under such circumstances, in
order to receive a reduced sales charge, the Shareholder must notify the
Distributor that a sales charge was originally paid and provide the Distributor
with sufficient information to permit confirmation of qualification. The
foregoing exchange privilege may be exercised only once during a calendar year
and upon written request by the Shareholder and may be terminated or modified by
the Trust at any time, or from time to time.

An exchange is considered a sale of Shares and may result in a capital gain or
loss for federal income tax purposes.

A Shareholder wishing to exchange his or her Shares may do so by contacting
the Trust at 1-800-743-8637, by contacting their broker-dealer or by providing
written instructions to the Distributor. Any Shareholder who wishes to make an
exchange should obtain and review the current prospectus of the fund of the
Trust in which the Shareholder wishes to invest before making the exchange. For
a discussion of risks associated with unauthorized telephone exchanges, see
"REDEEMING SHARES--By Telephone" below.

CONVERSION FEATURE

Eight years after purchase, Class C Shares will convert automatically to Class
A Shares. The purpose of the conversion is to relieve a holder of Class C Shares
of the higher ongoing expenses charged to those Shares, after enough time has
passed to allow the Distributor to recover approximately the amount it would
have received if a front-end sales charge had been charged. The conversion from
Class C Shares to Class A Shares takes place at net asset value, as a result of
which an investor receives dollar-for-dollar the same value of Class A Shares as
he or she had of Class C Shares. The conversion occurs eight years after the
beginning of the calendar month in which the Shares are purchased. As a result
of the conversion, the converted Shares are relieved of the Rule 12b-1 fees
borne by Class C Shares, although they are subject to the Rule 12b-1 fees borne
by Class A Shares.

QUALIVEST INDIVIDUAL RETIREMENT ACCOUNTS ("IRA")

A Qualivest IRA enables individuals, even if they participate in an
employer-sponsored retirement plan, to establish their own retirement program.
Qualivest IRA contributions may be tax-deductible and earnings are tax-deferred.
Under the Tax Reform Act of 1986, the tax deductibility of IRA contributions is
restricted or eliminated for individuals who participate in certain employer
pension plans and whose annual income exceeds certain limits. Existing IRAs and
future contributions up to the IRA maximums, whether deductible or not, still
earn income on a tax-deferred basis.

SIMPLIFIED EMPLOYEE PENSION PLAN ("SEP/IRA")

A Qualivest SEP/IRA may be established on a group basis by an employer who
wishes to sponsor a tax-sheltered retirement program by making contributions
into IRAs on behalf of all eligible employees.

SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION PLAN ("SAR-SEP/IRA")

A Qualivest SAR-SEP/IRA offers employers with 25 or fewer eligible employees
the ability to

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<PAGE>
establish a SEP/IRA that permits salary reduction contributions. All Qualivest
IRA distribution requests must be made in writing to BISYS Fund Services. Any
additional deposits to a Qualivest IRA must distinguish the type and year of the
contribution.

For more information on any of the Qualivest IRAs or other retirement plan
options available (401(k) Defined Contribution Plans, 403(b)(7) Defined
Compensation Plans, etc.), call the Trust at 1-800-743-8637. Shareholders are
advised to consult a tax adviser on Qualivest IRA contribution and withdrawal
requirements and restrictions.

REDEEMING SHARES

Shareholders may redeem their Class A Shares without charge and their Class C
Shares, subject to the CDSC described above if redeemed less than one year after
purchase, on any day that net asset value is calculated (see "VALUATION OF
SHARES"). Redemptions will be effected at the net asset value per Share next
determined after receipt by the Distributor of a redemption request. Redemptions
may be requested by mail or by telephone.

BY MAIL

A written request for redemption must be received by the Distributor in order
to honor the request. The Distributor's address is: BISYS Fund Services, 3435
Stelzer Road, Columbus, Ohio 43219 -3035. The Transfer Agent will require a
signature guarantee by an eligible guarantor institution. The signature
guarantee requirement will be waived if all of the following conditions apply:
(1) the redemption check is payable to the Shareholder(s) of record, and (2) the
redemption check is mailed to the Shareholder(s) at the address of record. The
Shareholder may also have the proceeds mailed to a commercial bank account
previously designated on the Account Application Form. There is no charge for
having redemption proceeds mailed to a designated bank account. To change the
address to which a redemption check is to be mailed, a written request therefor
must be received by the Transfer Agent. In connection with such request, the
Transfer Agent will require a signature guarantee by an eligible guarantor
institution.

For purposes of this policy, the term "eligible guarantor institution" shall
include banks, brokers, dealers, credit unions, securities exchanges and
associations, clearing agencies and savings associations as those terms are
defined in the 1934 Act. The Transfer Agent reserves the right to reject any
signature guarantee if (1) it has reason to believe that the signature is not
genuine, (2) it has reason to believe that the transaction would otherwise be
improper, or (3) the guarantor institution is a broker or dealer that is neither
a member of a clearing corporation nor maintains net capital of at least
$100,000.

BY TELEPHONE

Shares may be redeemed by telephone if the Account Application Form reflects
that the Shareholder has elected that privilege. If the telephone feature was
not originally selected, the Shareholder must provide written instructions to
the Trust to add it. The Shareholder may have the proceeds mailed to his or her
address or mailed or wired to a commercial bank account previously designated on
the Account Application Form. Under most circumstances, payments will be
transmitted on the next Business Day. Wire redemption requests may be made by
the Shareholder by telephone to the Trust at 1-800-743-8637. While the Transfer
Agent currently does not charge a wire redemption fee, the

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<PAGE>
Transfer Agent reserves the right to impose such a fee in the future.

The Trust's Account Application Form provides that none of BISYS, the Transfer
Agent, Qualivest, the Trust or any of their affiliates or agents will be liable
for any loss, expense or cost when acting upon any oral, wired or electronically
transmitted instructions or inquiries believed by them to be genuine. While
precautions will be taken, as more fully described below, Shareholders bear the
risk of any loss as the result of unauthorized telephone redemptions or
exchanges believed by the Transfer Agent to be genuine. The Trust will employ
reasonable procedures to confirm that instructions communicated by telephone are
genuine. These procedures include recording all phone conversions, sending
confirmations to Shareholders within 72 hours of the telephone transaction,
verifying the account name and a Shareholder's account number or tax
identification number and sending redemption proceeds only to the address of
record or to a previously authorized bank account. If a Shareholder is unable to
contact the Funds by telephone, a Shareholder may also mail the redemption
request to the Distributor at the address above.

AUTO WITHDRAWAL PLAN

The Auto Withdrawal Plan enables Shareholders of the Funds to make regular
monthly, bi-monthly, or quarterly redemptions of Class A or Class C Shares. With
Shareholder authorization, the Transfer Agent will automatically redeem Class A
or Class C Shares at the net asset value on the fifth and/or twentieth day of
the month or quarter (or the next Business Day thereafter) and have the amount
specified transferred according to the written instructions of the Shareholder.
Shareholders participating in this Plan must maintain a minimum account balance
of $500. The required minimum withdrawal is $100, monthly or quarterly.

The Auto Withdrawal Plan may be modified or terminated without notice. In
addition, the Trust may suspend a Shareholder's withdrawal plan without notice
if the account contains insufficient funds to effect a withdrawal or in the
event that the account balance is less than the minimum $500 amount.

To participate in the Auto Withdrawal Plan, Shareholders should call
1-800-743-8637 for more information. Purchases of additional Class A or Class C
Shares concurrently with withdrawals may be disadvantageous to certain
Shareholders because of tax liabilities and sales charges. For a Shareholder to
change the Auto Withdrawal Plan instructions, the request must be made in
writing to the Distributor and may take up to 15 days to implement.

OTHER INFORMATION REGARDING REDEMPTION OF SHARES

All redemption orders are effected at the net asset value per Share next
determined after the Shares are properly tendered for redemption, as described
above. The proceeds paid upon redemption of Shares in the Funds, less any
applicable CDSC, may be more or less than the amount invested. Payment to
Shareholders for Shares redeemed will be made within seven days after receipt of
the request for redemption, or within such shorter period as required by law. To
the greatest extent possible, requests from Shareholders of an Equity Fund or an
Income Fund for next Business Day payments upon redemption of Shares will be
honored if received in good form by the Distributor before the last Valuation
Time on a Business Day or, if received after the last Valuation Time, within two
Business Days, unless it would be disadvantageous to that Fund or its
Shareholders to sell or liquidate portfolio securities in an amount sufficient
to satisfy requests for payments in that manner. Likewise, the Trust will
attempt to honor requests from Shareholders for same Business Day payments upon
redemption of Class A Shares of the Money

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<PAGE>

Funds if the request for redemption is received by the Distributor before 11:30
a.m. Pacific Time on a Business Day or, if the request for redemption is
received after 11:30 a.m. Pacific Time, to honor requests for payment on the
next Business Day, unless it would be disadvantageous to that Fund or its
Shareholders to sell or liquidate portfolio securities in an amount sufficient
to satisfy requests for payments in that manner.

The Trust reserves the right to redeem involuntarily, at net asset value, the
Shares of any Shareholder if, because of redemptions of Shares by or on behalf
of the Shareholder (but not as a result of the establishment of an account with
less than $500 using the Auto Invest Plan), the account of such Shareholder has
a value of less than $500. Accordingly, an investor purchasing Shares of a Fund
in only the minimum investment amount may be subject to such involuntary
redemption if the investor thereafter redeems any Shares. Before the Trust
exercises its right to redeem such Shares and to send the proceeds to the
Shareholder, the Shareholder will be given notice that the value of the Shares
in the Shareholder's account is less than the minimum amount and will be allowed
60 days to make an additional investment in an amount which will increase the
value of the account to at least $500.

At various times, the Trust may be requested to redeem Shares for which it has
not yet received good payment. In such circumstances, the forwarding of proceeds
may be delayed until payment has been collected for the purchase of such Shares,
which delay may be for 15 days or more. Such delay may be avoided if Shares are
purchased by wire transfer of federal funds. The Trust intends to pay cash for
all Shares redeemed, but under abnormal conditions which make payment in cash
unwise, payment may be made wholly or partly in portfolio securities at their
then market value equal to the redemption price. In such cases, an investor may
incur brokerage costs in converting such securities to cash.

See the Statement of Additional Information ("ADDITIONAL PURCHASE AND
REDEMPTION INFORMATION") for examples of when the right of redemption may be
suspended.

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<PAGE>
MANAGEMENT OF THE FUNDS

TRUSTEES

Overall responsibility for management of the Trust rests with its Trustees,
who are elected by the Shareholders of all of the Trust's funds. The Trust will
be managed by the Trustees in accordance with the laws of the Commonwealth of
Massachusetts governing business trusts. There are currently six Trustees, three
of whom are not "interested persons" of the Trust within the meaning of that
term under the 1940 Act. The Trustees, in turn, elect the officers of the Trust
to supervise its day-to-day operations. The Trustees of the Trust are: George R.
Landreth, David F. Jones, John W. Judy, Raymond H. Lung, Mary Anne Houlahan and
David B. Frohnmayer.

INVESTMENT ADVISER

Qualivest Capital Management, Inc., 111 S.W. Fifth Avenue, Portland, Oregon
97204, is the investment adviser of the Trust. Qualivest, a registered
investment adviser, is an affiliate of U.S. Bank, which is a wholly owned
subsidiary of U.S. Bancorp. U.S. Bancorp is a super-regional financial services
holding company organized under the laws of Oregon in 1968. U.S. Bank,
headquartered in Portland, is a national banking association chartered in 1891.
It offers a wide variety of full-service and commercial banking operations in
over 200 locations in Oregon. Other services of U.S. Bancorp and its
subsidiaries include mortgage banking, lease financing, consumer financing,
commercial finance, international banking, investment advisory, insurance agency
and credit life insurance services, brokerage and venture capital. As of July
31, 1995, Qualivest had under management nearly $6.5 billion in assets. It also
is investment adviser to Tax-Free Trust of Oregon, a tax-free municipal bond
fund, whose assets were approximately $310 million at that date.

Subject to the general supervision of the Trust's Board of Trustees and in
accordance with each of the Funds' investment objective, policies and
restrictions, Qualivest has agreed in its Investment Advisory Agreement with the
Trust to provide or arrange for the provision of a continuous investment program
for each Fund, including investment research and management with respect to the
Funds' portfolio securities, investments and cash.

John R. Dozier, who joined Qualivest in 1976, is the Equity Manager primarily
responsible for managing the Large Companies Fund. Mr. Dozier has twenty-five
years of investment management experience and received a Bachelor of Arts degree
in Economics from Claremont Men's College.

Dale E. Benson, an Equity Manager at Qualivest, has primary responsibility for
management of the Small Companies Fund. Mr. Benson has twenty-three years of
investment management experience and has been employed by Qualivest since 1973.
He received a Bachelor of Arts degree from Pacific Lutheran University and a
Doctorate in History from the University of Maine. Mr. Benson is also a
Chartered Financial Analyst.

Timothy Leach, President and Chief Investment Officer of Qualivest, manages
the International Fund and Optimized Fund. He has thirteen years of investment
management experience, both at Qualivest and at other investment management
organizations, and is responsible for the management of Qualivest. Mr. Leach has
a Bachelor of Science degree in Business Management and Agricultural Science and
a Master of Business Administration degree from the University of California,
Berkeley.

Portfolio management of the Intermediate Bond Fund and the Bond Fund is the
responsibility of Curry A. Garvin, a Fixed-Income Manager who has been employed
by Qualivest since 1985. Mr. Garvin, who is a Chartered Financial
Ana-

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<PAGE>
lyst, received a Bachelor of Science degree in Finance from the University of
Oregon.

For the services provided and expenses assumed pursuant to its Investment
Advisory Agreement with the Trust, Qualivest receives a fee from each of the
Funds, computed daily and paid monthly, at the following annual rates of each
Fund's average daily net assets: Large Companies Fund--0.75%; Small Companies
Fund--0.80%; International Fund--0.60%; Optimized Fund--0.50%; Intermediate Bond
Fund--0.60%; Bond Fund--0.60%; U.S. Treasury Fund--0.35%; Money Market Fund--
0.35%; and Tax-Free Money Market Fund-- 0.35%.

While the fees for the Large Companies and Small Companies Funds are higher
than the advisory fees paid by most investment companies, the Board of Trustees
believes them to be comparable to advisory fees paid by many funds having
similar objectives and policies. Qualivest may periodically voluntarily reduce
all or a portion of its advisory fee with respect to a Fund to increase the net
income of that Fund available for distribution as dividends. The voluntary fee
reduction will cause the return of that Fund to be higher than it would
otherwise be in the absence of such reduction.

ADMINISTRATOR AND DISTRIBUTOR

BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035, a division
of BISYS Group, Inc., is the administrator for each fund of the Trust, and also
acts as the Trust's principal underwriter and distributor.

The Administrator generally assists in all aspects of the Funds'
administration and operation. For expenses assumed and services provided as
administrator pursuant to its Management and Administration Agreement with the
Trust, the Administrator receives a fee from each Fund equal to the lesser of a
fee, computed daily and paid periodically, at an annual rate of 0.13% of the
Fund's average daily net assets, or such other fee as may be agreed upon from
time to time by the Trust and the Administrator. The Administrator may
periodically voluntarily reduce all or a portion of its administrative fee with
respect to a Fund to increase the net income of that Fund available for
distribution as dividends. The voluntary fee reduction will cause the return of
that Fund to be higher than it would otherwise be in the absence of such
reduction.

The Distributor acts as agent for the Funds in the distribution of their
Shares and, in such capacity, solicits orders for the sale of Shares,
advertises, and pays the cost of advertising, office space and its personnel
involved in such activities. Under its Distribution Agreement with the Trust,
the Distributor may retain some or all of any sales charge imposed upon the
Shares. It may also receive compensation under the Distribution and Shareholder
Service Plans regarding the Class A Shares and Class C Shares described below.

OTHER SERVICE PROVIDERS

BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-3035,
serves as the Trust's transfer agent and dividend disbursing agent pursuant to a
Transfer Agency Agreement with the Trust and receives a fee for such services.
BISYS Fund Services Ohio, Inc. also provides certain accounting services for
each of the Funds and receives a fee for such services. Deloitte & Touche LLP
serves as independent auditors for the Trust. United States National Bank of
Oregon is the custodian of all of the Funds except the International Fund, for
which The Bank of New York is the custodian. See "MANAGEMENT OF THE TRUST" in
the Statement of Additional Information for further information.

While BISYS Fund Services Ohio, Inc. is a distinct legal entity from BISYS
(the Trust's

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<PAGE>
administrator and distributor), BISYS Fund Services Ohio, Inc. is considered to
be an affiliated person of BISYS under the 1940 Act due to, among other things,
the fact that BISYS Fund Services Ohio, Inc. is owned by substantially the same
persons that directly or indirectly own BISYS.

EXPENSES

Qualivest and the Administrator each bear all expenses in connection with the
performance of its services other than the cost of securities (including
brokerage commissions) purchased for the Trust. Each Fund will bear the
following expenses relating to its operation: organizational expenses, taxes,
interest, brokerage fees and commissions, fees of the Trustees of the Trust,
Securities and Exchange Commission fees, pricing of portfolio securities, state
securities qualification fees, costs of preparing and printing prospectuses for
regulatory purposes and for distribution to current Shareholders, outside
auditing and legal expenses, advisory and administration fees, fees and
out-of-pocket expenses of the Custodians, Transfer Agent and fund accountant,
certain insurance premiums, costs of maintenance of the Trust's existence, costs
of Shareholders' reports and meetings, and any extraordinary expenses incurred
in each Fund's operation. The ratios of operating expenses to average daily net
assets of the Class A Shares for the period ended July 31, 1995 were as follows:
Large Companies Fund--1.04%; Small Companies Fund--1.11%; International
Fund--1.40%; Optimized Fund--0.91%; Intermediate Bond Fund--0.80%; Bond
Fund--0.95%; U.S. Treasury Fund--0.81%; Money Market Fund-- 0.79%; and Tax-Free
Money Market Fund-- 1.00%. For the Class C Shares, the ratios for the same
period were: Large Companies Fund-- 1.78%; Small Companies Fund--1.85%;
International Fund--2.18%; Optimized Fund--1.68%; Intermediate Bond Fund--1.59%;
and Bond Fund--1.70%.

As a general matter, expenses are allocated to the Class A, Class C, Class Q
and Class Y Shares of the Funds on the basis of the relative net asset value of
each class. Class A Shares and Class C Shares may bear certain additional retail
transfer agency expenses and also bear certain additional Shareholder service
and distribution costs incurred pursuant to the Distribution and Shareholder
Service Plans described below.

The Trustees reserve the right, subject to the receipt of relevant regulatory
approvals or rulings, if needed, to allocate certain other expenses to the
Shareholders of a particular class, including Class A and Class C Shares, on a
basis other than relative net asset value, as they deem appropriate ("Class
Expenses"). In such event, Class Expenses would be limited to: transfer agency
fees identified by the Transfer Agent as attributable to a specific class;
printing and postage expenses related to preparing and distributing materials
such as Shareholder reports, prospectuses and proxies to current Shareholders;
Blue Sky registration fees incurred by a class of Shares; Securities and
Exchange Commission registration fees incurred by a class of Shares; expenses
related to administrative personnel and services as required to support the
Shareholders of a specific class; litigation or other legal expenses relating
solely to one class of Shares; and Trustees' fees incurred as a result of issues
relating solely to one class of Shares.

PORTFOLIO TRANSACTIONS

Pursuant to the Investment Advisory Agreement, Qualivest places orders for the
purchase and sale of portfolio investments for the Funds' accounts with brokers
or dealers it selects in its discretion. Broker-dealers selected to execute
portfolio transactions for the Funds may include affiliates of the Trust,
Qualivest or BISYS, provided the charge for any such transaction does not exceed
usual and customary levels.

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<PAGE>
BANKING LAWS

Federal banking laws and regulations presently prohibit a national bank or any
affiliate thereof from sponsoring, organizing or controlling a registered
open-end investment company continuously engaged in the issuance of its shares,
and generally from underwriting, selling or distributing securities, such as
Shares of the Funds.

Qualivest is a subsidiary of U.S. Bank, and it and U.S. Bank are affiliates of
a bank holding company. They are therefore subject to applicable federal banking
laws and regulations. Qualivest has been advised by its counsel that it may
perform the advisory services for the Funds required by the Investment Advisory
Agreement and, provided that they do not engage in underwriting, selling or
distribution of the Funds' Shares, Qualivest's national bank affiliates may
perform shareholder servicing activities and may receive compensation without
violating federal banking laws and regulations.

In the event that, due to future events, Qualivest is prohibited from acting
as the Funds' investment adviser, it is probable that the Board of Trustees
would either recommend to Shareholders the selection of another qualified
adviser or, if that course of action appeared impractical, that the Funds be
liquidated.

DISTRIBUTION PLANS

Pursuant to Rule 12b-1 under the 1940 Act, the Trust has adopted Distribution
and Shareholder Service Plans with respect to the Class A Shares of each Fund
(the "Class A Plans"), as well as Distribution and Shareholder Service Plans
with respect to Class C Shares of each Equity and Income Fund (the "Class C
Plans" and, with the Class A Plans, the "Plans").

Pursuant to the Class A Plans, each Fund is authorized to pay or reimburse
BISYS, as Distributor of the Class A Shares of the Fund, for certain expenses
that are incurred in connection with Shareholder and distribution services.
Payments under the Class A Plans will be calculated daily and paid monthly at an
annual rate not to exceed 0.25% of the average daily net assets of Class A
Shares of each Equity and Income Fund and 0.40% of the average daily net assets
of Class A Shares of each Money Fund. As authorized by the Class A Plans, BISYS
has entered into a Rule 12b-1 Agreement with U.S. Bancorp Securities, Inc.
("USBS"), an affiliate of Qualivest, pursuant to which USBS has agreed to
provide certain Shareholder and distribution services in connection with Class A
Shares of the Funds purchased and held by USBS for the accounts of its customers
and Class A Shares of the Funds purchased and held by customers of USBS
directly. BISYS will be compensated by the Funds in an amount equal to its
payments to USBS under the Rule 12b-1 Agreement. Such fee may exceed the actual
costs incurred by USBS in providing such services.

Pursuant to the Class C Plans, an Equity Fund and Income Fund is authorized to
pay or reimburse BISYS, as Distributor of Class C Shares, (a) a distribution fee
in an amount not to exceed on an annual basis 0.75% of the average daily net
assets of Class C Shares of a Fund, and (b) a service fee in an amount not to
exceed on an annual basis 0.25% of the average daily net assets of the Class C
Shares of a Fund. Payments under the Class C Plan will be calculated daily and
paid monthly at a rate not to exceed the limits described above, which rates are
set from time to time by the Board of Trustees. Actual distribution expenses for
Class C Shares at any given time may exceed the Rule 12b-1 fees and payments
received pursuant to CDSCs. These unrecovered amounts plus interest thereon will
be carried forward and paid from future

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<PAGE>
Rule 12b-1 fees and payments received from CDSCs. If the Class C Plan were
terminated or not continued, the Trust would not be contractually obligated to
pay for any expenses not previously reimbursed by the Trust or recovered through
CDSCs.

Payments under the Plans may be used by BISYS to pay banks and their
affiliates (including U.S. Bank and its affiliates), and other institutions,
including broker-dealers (each a "Participating Organization"), for
administration, distribution, and/or Shareholder service assistance pursuant to
an agreement between BISYS and the Participating Organization. Pursuant to the
Plans, the Distributor may enter into Rule 12b-1 Agreements with Participating
Organizations for providing Shareholder and distribution services to their
customers who are the record or beneficial owners of Shares. Such Participating
Organizations will be compensated at an annual rate of up to 0.25% (up to 0.40%
for the Money Funds) of the average daily net assets of the Class A Shares, and
up to 0.25% of the average daily net assets of the Class C Shares, held of
record or beneficially by such customers. Under the Plans, a Participating
Organization may include BISYS, its subsidiaries, and its affiliates.

Payments to the Distributor pursuant to the Plans will be used (i) to
compensate Participating Organizations for providing distribution assistance
relating to Shares, (ii) for promotional activities intended to result in the
sale of Shares, such as to pay for the preparation, printing and distribution of
prospectuses to other than current Shareholders, and (iii) to compensate
Participating Organizations for providing Shareholder services with respect to
their customers who are, from time to time, beneficial and record holders of
Shares of the Funds.

Fees paid pursuant to the Class A Plans and Class C Plans are accrued daily
and paid monthly, and are charged as expenses of Class A Shares and Class C
Shares, respectively, of a Fund as accrued.

GENERAL INFORMATION

The Plans may be terminated by a vote of a majority of the Trustees who are
not "interested persons" (as defined in the 1940 Act) of the Trust and who have
no direct or indirect financial interest in the operation of the Plans or in any
agreements related to a Plan ("Independent Trustees"), or by a vote of a
majority of the holders of the outstanding voting securities of the class of
Shares subject thereto. Any change in the Plans that would increase materially
the distribution expenses paid by a Fund requires Shareholder approval;
otherwise, the Plans may be amended by the Trustees, including a majority of the
Independent Trustees, by a vote cast in person at a meeting called for the
purpose of voting upon the amendment. As long as either Plan is in effect, the
selection or nomination of the Independent Trustees is committed to the
discretion of the Independent Trustees.

DIVIDENDS AND TAXES

DIVIDENDS

48
<PAGE>
declaration. Dividends consisting of short-term capital gains are declared from
time to time as may be appropriate. Dividends for the Money Funds are paid
monthly. A Shareholder will automatically receive all income dividends and
capital gains distributions in additional full and fractional Shares at net
asset value as of the date of declaration, unless the Shareholder elects to
receive dividends or distributions in cash or elects to participate in the
Qualivest Directed Dividend Option. Such election, or any revocation thereof,
must be made in writing to the Transfer Agent at 3435 Stelzer Road, Columbus,
Ohio 43219-3035, and will become effective with respect to dividends and
distributions having record dates after its receipt by the Transfer Agent.

DIRECTED DIVIDEND OPTION

A Shareholder may elect to have all income dividends and capital gains
distributions paid by check, reinvested in the Fund or reinvested in the same
class of any of the Trust's other funds, provided the other fund is maintained
at the minimum required balance. The Directed Dividend Option may be modified or
terminated by the Trust at any time after notice to participating Shareholders.
Participation in the Directed Dividend Option may be terminated or changed by
the Shareholder at any time by writing the Distributor. The Directed Dividend
Option is not available to participants in any of the Qualivest IRAs.

FEDERAL TAXES

Each Fund intends to qualify annually and elect to be treated as a regulated
investment company under the Code, so that it generally will not be subject to
federal income tax on its taxable income and gains that are distributed to
Shareholders. In order to avoid a 4% federal excise tax, each Fund intends to
distribute each calendar year substantially all of its taxable income and gains.

Distributions from a Fund's investment company taxable income (which includes,
among other items, dividends, taxable interest and the excess, if any, of net
short-term capital gains over net long-term capital losses) are taxable to
Shareholders as ordinary income. Dividends paid by the Equity Funds to corporate
Shareholders, to the extent such dividends are attributable to dividends
received from U.S. corporations, may qualify for the dividends-received
deduction. However, the alternative minimum tax applicable to corporations may
reduce the value of the dividends-received deduction. Distributions of net
capital gains (the excess of net long-term capital gains over net short-term
capital losses), if any, designated by a Fund as capital gain dividends, are
taxable as long-term capital gains, regardless of how long the Shareholder has
held the Fund's Shares and are not eligible for the dividends-received
deduction.

The Tax-Free Money Market Fund intends to invest a sufficient portion of its
assets in state and municipal obligations so that it will qualify to pay
"exempt-interest dividends" to Shareholders. Such exempt-interest dividends are
excludable from a Shareholder's gross income for federal income tax purposes.
However, to the extent that the Tax-Free Money Market Fund's interest income is
attributable to certain so-called "private activity bonds," dividends allocable
to such income, while exempt from the regular federal income tax, will
constitute an item of tax preference for purposes of the alternative minimum
tax. Exempt-interest dividends are includable in the tax base for determining
the extent to which social security or railroad retirement benefits will be
subject to federal income tax. The Tax-Free Money Market Fund may derive taxable
investment income and realize capital gains or losses from portfolio
transactions, including the sale of securities; distributions to Shareholders
derived from such income and gains will be taxable to the

49
<PAGE>
Shareholders. Deductions for interest expense incurred (or deemed to be
incurred) to acquire or carry Shares of the Tax-Free Money Market Fund may be
subject to limitations that reduce or eliminate such deductions.

Certain dividends declared by a Fund in October, November or December and paid
during the following January will be treated as having been received by
Shareholders on December 31 in the year the distributions were declared.
Reinvested distributions will be taxable as if they had been received in cash.

Each Fund may be required to withhold federal income tax at the rate of 31% of
all taxable distributions paid to Shareholders who fail to provide a Fund with
their correct taxpayer identification number or to make required certifications
or who have been notified by the Internal Revenue Service ("IRS") that they are
subject to backup withholding. Corporate Shareholders and certain other
Shareholders specified in the Code are exempt from backup withholding. Backup
withholding is not an additional tax and any amounts withheld may be credited
against the Shareholder's federal income tax liability.

Shareholders of the Funds should be aware that under the laws of some state
and local taxing authorities, distributions from a Fund that are attributable to
interest earned on certain U.S. Government securities may not be subject to
state or local taxes. Shareholders of the Tax-Free Money Market Fund should be
aware that under the laws of some state and local taxing authorities,
distributions from the Fund that are attributable to interest on state and
municipal securities issued within the Shareholder's own state may not be
subject to state or local taxes.

Prior to purchasing Shares of the Equity Funds or the Income Funds, the impact
of dividends or capital gains distributions which are expected to be declared or
have been declared, but have not been paid, should be carefully considered. Any
such dividends or capital gains distributions paid shortly after a purchase of
Shares prior to the record date will have the effect of reducing the per Share
net asset value of the Shares by the amount of the dividends or distributions.
All or a portion of such dividends or distributions, although in effect a return
of capital, is subject to tax.

Shareholders will be furnished annually with information relating to the
nature and amounts of distributions made by a Fund.

The proceeding discussion is only a summary of some of the federal tax
considerations generally affecting the Funds and their Shareholders and does not
address every possible situation. Distributions (including exempt-interest
dividends) may be subject to state, local and foreign taxes, and non-U.S.
Shareholders may be subject to U.S. tax rules that differ significantly from
those summarized herein. Persons who may be "substantial users" (or "related
persons" of substantial users) of facilities financed by private activity bonds
may suffer adverse tax consequences from investing in the Tax-Free Money Market
Fund. Prospective Shareholders should consult their tax advisers with respect to
the effect of investing in a Fund. For additional information relating to taxes,
see "ADDITIONAL INFORMATION--Additional Tax Information" in the Statement of
Additional Information.

50
<PAGE>
GENERAL INFORMATION

ORGANIZATION OF THE TRUST

The Trust was organized as a Massachusetts business trust in 1994 and consists
of eleven funds. The Shares of each of the Equity Funds and the Income Funds are
offered in three separate classes: Class A Shares, Class C Shares and Class Y
Shares. Shares of each of the Money Funds are also offered in three separate
classes: Class A Shares, Class Q Shares and Class Y Shares. Each Share
represents an equal proportionate interest in a fund with other Shares of the
same fund, and is entitled to such dividends and distributions out of the income
earned on the assets belonging to that fund as are declared at the discretion of
the Trustees. Shares are without par value. Shareholders are entitled to one
vote for each dollar of value invested and a proportionate fractional vote for
any fraction of a dollar invested. Shareholders will vote in the aggregate and
not by fund except as otherwise expressly required by law.

An annual or special meeting of Shareholders to conduct necessary business is
not required by the Trust's Declaration of Trust, the 1940 Act or other
authority except, under certain circumstances, to elect Trustees, amend the
Declaration of Trust, approve an investment advisory agreement and to satisfy
certain other requirements. To the extent that such a meeting is not required,
the Trust may elect not to have an annual or special meeting.

The Trust will call a special meeting of Shareholders for purposes of
considering the removal of one or more Trustees upon written request therefor
from Shareholders holding not less than 10% of the outstanding votes of the
Trust. At such a meeting, a quorum of Shareholders (constituting a majority of
votes attributable to all outstanding Shares of the Trust), by majority vote,
has the power to remove one or more Trustees.

MULTIPLE CLASSES OF SHARES

In addition to Class A and Class C Shares, the Trust also offers Class Q
Shares of the Money Funds and Class Y Shares of all of the Funds. Class Q Shares
are sold through procedures established by the Distributor only to certain
corporations, pension plans, foundations, charitable institutions, certain large
investors, insurance companies, banks and other banking institutions, and
non-bank fiduciaries. Class Y Shares are sold through procedures established by
the Distributor only to certain institutional investors and bank trust
departments purchasing Shares on behalf of fiduciary, advisory, agency, custody
or other similar accounts maintained by, or on behalf of, their customers. Class
Q Shares of the Money Funds are not sold subject to a sales load and bear
expenses of up to 0.25% of the average daily net assets of Class Q Shares under
a Distribution and Shareholder Service Plan pertaining to Class Q Shares (also
a "Plan"). Class Y Shares are not sold subject to a sales load and do not bear
expenses under the Plans pertaining to Class A, Class C and Class Q Shares. In
addition, Class A and Class C Shares may bear additional retail transfer agency
expenses. A salesperson or other person entitled to receive compensation for
selling or servicing the Shares may receive different compensation with respect
to one particular class of Shares over another in the same Fund. For further
details regarding eligibility requirements for the purchase of Class Q and Class
Y Shares, call the Trust at 1-800-743-8637.

The amount of dividends payable with respect to Class Q and Class Y Shares
will exceed dividends on Class A and Class C Shares as a result of the Plan fees
applicable to Class A and Class C Shares and because Class A and Class C Shares
may bear additional retail transfer agency expenses. The amount of dividends
payable with respect to Class Y Shares will also

51
<PAGE>
exceed dividends on Class Q Shares as a result of the Plan fees applicable to
Class Q Shares.

Each Fund intends to seek a ruling from the IRS to the effect that differing
distributions among the classes of its Shares will not result in the Fund's
dividends or other distributions being regarded as "preferential dividends"
under the Code. While similar rulings have been issued by the IRS, complete
assurance cannot, of course, be given that the Funds will receive such rulings.
For additional information, see the Statement of Additional Information.

PERFORMANCE INFORMATION

From time to time performance information for the Funds showing their average
annual total return, aggregate total return and/or yield may be presented in
advertisements, sales literature and Shareholder reports. In addition, tax
equivalent yield may be presented in advertisements, sales literature and
Shareholder reports of the Tax-Free Money Market Fund. Such performance figures
are based on historical earnings and are not intended to indicate future
performance. Also, from time to time, the Equity and Income Funds may present
their respective distribution rates for a class of Shares in supplemental sales
literature which is accompanied or preceded by a prospectus and in Shareholder
reports.

Standardized yield and total return quotations will be computed separately for
Class A, Class C, Class Q and Class Y Shares. Because of differences in the fees
and/or expenses borne by Class A, Class C, Class Q and Class Y Shares of the
Funds, the net yield and total return on Class A and Class C Shares can be
expected, at any given time, to be lower than the net yield and total return on
Class Q and Class Y Shares for the same period, and the net yield and total
return on Class Q Shares of the Money Funds can be expected to be lower than the
net yield and total return on Class Y Shares for the same period.

Investors may also judge the performance of any class of Shares or Fund by
comparing or referencing it to the performance of other mutual funds with
comparable investment objectives and policies through various mutual fund or
market indices such as those prepared by various services, which indices may be
published by such services or by other services or publications, including, but
not limited to, ratings published by Morningstar, Inc. In addition to
performance information, general information about the Funds that appears in
such publications may be included in advertisements, in sales literature and in
reports to Shareholders. For further information regarding such services and
publications, see "ADDITIONAL INFORMATION--Performance Comparisons" in the
Statement of Additional Information.

Total return and yield are functions of the type and quality of instruments
held in the portfolio, operating expenses, and market conditions. Any fees
charged with respect to customer accounts for investing in Shares of the Funds
will not be included in performance calculations; such fees, if charged, will
reduce the actual performance from that quoted. In addition, if Qualivest and
BISYS voluntarily reduce all or a part of their respective fees, the total
return of such Fund will be higher than it would otherwise be in the absence of
such voluntary fee reductions.

ACCOUNT SERVICES

Shareholders of the Trust may obtain current price, yield and other
performance information on the Funds or any of the Trust's funds 24 hours a day
by calling 1-800-743-8637 from any touch-tone telephone.

52
<PAGE>
MISCELLANEOUS

Shareholders will receive unaudited semi-annual reports and annual reports
audited by independent public accountants. Inquiries regarding the Trust may be
directed in writing to Qualivest Funds at 3435 Stelzer Road, Columbus, Ohio
43219, or by calling toll free 1-800-743-8637.

No person has been authorized to give any information or to make any
representations not contained in this Prospectus 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 by their Distributor in any jurisdiction in which such offering may not
lawfully be made.

53
<PAGE>

SUBJECT TO COMPLETION: DATED ____________

QUALIVEST FUNDS

3435 Stelzer Road
Columbus, Ohio 43219-3035
1-800-743-8637

Qualivest Funds (the "Trust") is an open-end management investment company
which offers seventeen separate diversified investment portfolios
("funds"), each with different investment objectives and policies. These
funds enable the Trust to meet a wide range of investment needs. This
Prospectus relates only to the following funds (the "Funds"):

- Qualivest Large Companies Growth Fund; and
- Qualivest Micro Cap Value Fund.

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"), acts
as the investment adviser to each of the Funds.

Additional information about the Trust and each of the Funds, contained in
a Statement of Additional Information dated ___________, 1996, has been
filed with the Securities and Exchange Commission and is available upon
request without charge by writing to the Trust at its address or by calling
the Trust at the telephone number shown above.

Shares of the Funds are not deposits or obligations of, and are not
endorsed, insured or guaranteed by, any bank, the Federal Deposit
Insurance Corporation, or any other agency. An investment in the Funds
involves investment risk, including the possible loss of principal.

This Prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Investors should read
this Prospectus and retain it for future reference.

<PAGE>

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

The date of this Prospectus is _______________, 1996.

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF
ANY SUCH STATE.

- 2 -

<PAGE>

TABLE OF CONTENTS

Page
----

PROSPECTUS SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . .
Shares Offered . . . . . . . . . . . . . . . . . . . . . . . . . .
Offering Price and Sales Charges . . . . . . . . . . . . . . . . .
Minimum Purchase . . . . . . . . . . . . . . . . . . . . . . . . .
Investment Objectives . . . . . . . . . . . . . . . . . . . . . .
Investment Policies . . . . . . . . . . . . . . . . . . . . . . .
Risk Factors and Special Considerations . . . . . . . . . . . . .
Investment Adviser . . . . . . . . . . . . . . . . . . . . . . . .
Dividends and Capital Gains . . . . . . . . . . . . . . . . . . .
Other Information . . . . . . . . . . . . . . . . . . . . . . . .
Guide to Investing in the Qualivest Funds . . . . . . . . . . . .

FUND EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

FEE TABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . . . .
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

INVESTMENT TECHNIQUES AND RISK FACTORS . . . . . . . . . . . . . . . .
Micro Capitalization Securities . . . . . . . . . . . . . . . . .
Put and Call Options . . . . . . . . . . . . . . . . . . . . . . .
Foreign Securities . . . . . . . . . . . . . . . . . . . . . . . .
Foreign Currency Transactions . . . . . . . . . . . . . . . . . .
Futures Contracts . . . . . . . . . . . . . . . . . . . . . . . .
When-Issued and Delayed-Delivery Transactions . . . . . . . . . .
Lending of Portfolio Securities . . . . . . . . . . . . . . . . .
Repurchase Agreements . . . . . . . . . . . . . . . . . . . . . .
Reverse Repurchase Agreements and Dollar Roll Agreements . . . . .
Mortgage-Related and Asset-Backed Securities . . . . . . . . . . .
Medium-Grade Securities . . . . . . . . . . . . . . . . . . . . .
U.S. Government Securities . . . . . . . . . . . . . . . . . . . .
Bankers' Acceptances . . . . . . . . . . . . . . . . . . . . . . .
Certificates of Deposit and Time Deposits . . . . . . . . . . . .
Commercial Paper . . . . . . . . . . . . . . . . . . . . . . . . .
Securities Issued by Other Investment Companies . . . . . . . . .
Restricted Securities . . . . . . . . . . . . . . . . . . . . . .

- 3 -

<PAGE>

VALUATION OF SHARES . . . . . . . . . . . . . . . . . . . . . . . . . .

PURCHASING SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Mail . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Telephone or by Wire . . . . . . . . . . . . . . . . . . . . .
Other Information Regarding Purchases . . . . . . . . . . . . . .

SALES CHARGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Class A Shares . . . . . . . . . . . . . . . . . . . . . . . . . .
Class C Shares . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Information . . . . . . . . . . . . . . . . . . . . . . . .
Reduced Sales Charges -- Class A Shares . . . . . . . . . . . . .
Sales Charge Waivers . . . . . . . . . . . . . . . . . . . .
Senior Citizens Discount . . . . . . . . . . . . . . . . . . . . .
Concurrent Purchases . . . . . . . . . . . . . . . . . . . . . . .
Letters of Intent . . . . . . . . . . . . . . . . . . . . . . . .
Rights of Accumulation . . . . . . . . . . . . . . . . . . . . . .
Contingent Deferred Sales Charge ("CDSC") -- Class C Shares . . .
Factors to Consider When Selecting Class A Shares or Class C
Shares of the Funds . . . . . . . . . . . . . . . . . . . . .
Exchange Privilege . . . . . . . . . . . . . . . . . . . . . . . .
Conversion Feature . . . . . . . . . . . . . . . . . . . . . . . .

QUALIVEST INDIVIDUAL RETIREMENT ACCOUNTS ("IRA") . . . . . . . . . . .
Simplified Employee Pension Plan ("SEP/IRA") . . . . . . . . . . .
Salary Reduction Simplified Employee Pension Plan
("SAR-SEP/IRA") . . . . . . . . . . . . . . . . . . . . . . .

REDEEMING SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Mail . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Telephone . . . . . . . . . . . . . . . . . . . . . . . . . . .
Auto Withdrawal Plan . . . . . . . . . . . . . . . . . . . . . . .
Other Information Regarding Redemption of Shares . . . . . . . . .

MANAGEMENT OF THE FUNDS . . . . . . . . . . . . . . . . . . . . . . . .
Trustees . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment Adviser . . . . . . . . . . . . . . . . . . . . . . . .
Administrator and Distributor . . . . . . . . . . . . . . . . . .
Other Service Providers . . . . . . . . . . . . . . . . . . . . .
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Portfolio Transactions . . . . . . . . . . . . . . . . . . . . . .
Banking Laws . . . . . . . . . . . . . . . . . . . . . . . . . . .

- 4 -

<PAGE>

DISTRIBUTION PLANS . . . . . . . . . . . . . . . . . . . . . . . . . .
General Information . . . . . . . . . . . . . . . . . . . . . . .

DIVIDENDS AND TAXES . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Directed Dividend Option . . . . . . . . . . . . . . . . . . . . .
Federal Taxes . . . . . . . . . . . . . . . . . . . . . . . . . .

GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . .
Organization of the Trust . . . . . . . . . . . . . . . . . . . .
Multiple Classes of Shares . . . . . . . . . . . . . . . . . . . .
Performance Information . . . . . . . . . . . . . . . . . . . . .
Account Services . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . .

- 5 -

<PAGE>

PROSPECTUS SUMMARY

Shares Offered

Class A and Class C Shares of the Qualivest Large Companies Growth Fund
(the "Large Companies Growth Fund") and the Qualivest Micro Cap Value Fund
(the "Micro Cap Fund") (collectively, the "Funds"), which are two separate
diversified investment portfolios ("funds") of Qualivest Funds, a
Massachusetts business trust (the "Trust") which is registered as an
open-end management investment company.

Offering Price and Sales Charges

Each Fund offers investors a choice of Class A and Class C Shares, which
differ principally with respect to sales charges and the rate of expenses
to which they are subject. The public offering price of Class A Shares of
each Fund is equal to the net asset value per Share plus a sales charge
equal to 4.50% of the public offering price, reduced when the total
purchase amount is $50,000 or more (see "SALES CHARGES -- Class A Shares").
Under certain circumstances, the sales charge may be eliminated. The
public offering price of Class C Shares of each Fund is equal to the net
asset value per Share, but investors may be subject to a contingent
deferred sales charge ("CDSC") of 1.00% when Class C Shares are redeemed
less than one year after purchase.

Minimum Purchase

$500 minimum initial purchase per Fund, with $100 minimum subsequent
investments. Such minimum initial investment may be waived for certain
purchasers and is reduced to $50 for investors using the Auto Invest Plan
described herein, and such investors are subject to a $50 minimum for each
subsequent investment in a Fund.

Investment Objectives

- 6 -

<PAGE>

The Large Companies Growth Fund seeks long-term capital appreciation.
- -------------------------------

The Micro Cap Fund seeks capital appreciation.
- ------------------

Investment Policies

The Large Companies Growth Fund. Under normal market conditions, the Large
- -------------------------------
Companies Growth Fund will invest at least 65% of its total assets in
equity securities, including common stocks and securities convertible into
common stocks, of companies with a market capitalization of at least $1
billion at the time of purchase.

The Micro Cap Fund. Under normal market conditions, the Micro Cap Fund
- ------------------
will invest at least 65% of its total assets in equity securities,
including common stocks and securities convertible into common stocks, of
companies with a market capitalization of less than $500 million at the
time of purchase.

Risk Factors and Special Considerations

An investment in the Funds involves a certain amount of risk and may not be
suitable for all investors. The Micro Cap Fund invests in small companies,
which may have more volatile price fluctuations and less liquid securities
markets than larger companies. See "INVESTMENT TECHNIQUES AND RISK
FACTORS."

Investment Adviser

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"),
serves as investment adviser to each Fund. See "MANAGEMENT OF THE FUNDS -
Investment Adviser."

Dividends and Capital Gains

Dividends from net income are declared and paid quarterly for the Funds.
Net realized capital gains are distributed at least annually.

Other Information

U.S. Bank ("Custodian") is the Funds' custodian. BISYS Fund Services
("BISYS" or "Distributor" or "Administrator") serves as the distributor and
administrator of the Funds. BISYS Fund Services Ohio, Inc. ("Transfer
Agent") serves as the transfer agent and dividend disbursing agent and
provides certain accounting services for the Trust.

- 7 -

<PAGE>

Guide to Investing in the Qualivest Funds

Purchase orders for the Funds received by the Distributor prior to 1:00
p.m. Pacific Time will become effective that day.

- - Minimum Initial Investment.......................... $500
(Such minimum may be reduced for certain investors.)

- - Minimum Initial Investment for
IRAs and other qualified retirement plans........... $ 50

- - Minimum Subsequent Investment....................... $100
(Such minimum may be reduced for certain investors.)

- - Minimum Subsequent Investment for IRAs
and other qualified retirement plans................ $ 50

Shareholders may exchange Shares of a Fund for Shares of the same class of
another fund by telephone or mail. See "PURCHASING SHARES -- Exchange
Privilege" for more information.

- - Minimum Initial Exchange............................ $500
(No minimum for subsequent exchanges.)

Shareholders may redeem Shares by telephone, mail or through a Fund's Auto
Withdrawal Plan.

All dividends and distributions will be automatically reinvested at net
asset value in additional Shares of the same class of the applicable Fund
unless cash payment is requested.

See "PURCHASING SHARES" and "REDEEMING SHARES" for more information.

FUND EXPENSES

The following expense table indicates costs and expenses that an investor
should anticipate incurring either directly or indirectly as a Shareholder
of a Fund during its first fiscal year of operation. The numbers reflect
estimated levels of operating expenses.

- 8 -

<PAGE>

FEE TABLE
Qualivest Large Qualivest Micro
Companies Growth Fund Cap Value Fund
--------------------- --------------
Class A Class C Class A Class C
------- ------- ------- -------
<S> <C> <C> <C> <C>
Shareholder Transaction Expenses

Maximum Sales Charge Imposed on
Purchases (as a percentage
of offering price) . . . . . . . . . . 4.50% None 4.50% None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price) . . . . None None None None
Deferred Sales Charge (as a
percentage of redemption
proceeds)1 . . . . . . . . . . . . . . None 1.00% None 1.00%
Redemption Fees (as a percentage
of redemption proceeds) . . . . . . . None None None None
Exchange Fees . . . . . . . . . . . . . None None None None
Annual Fund Operating Expenses
(as a percentage of average
net assets annualized)
Management Fees After Waiver2 . . . . . ____% ____% ____% ____%
12b-1 Fees3 . . . . . . . . . . . . . . ____% ____% ____% ____%
Other Expenses . . . . . . . . . . . . ____% ____% ____% ____%
Total Fund Operating Expenses
After Waiver4. . . . . . . . . . . . . ____% ____% ____% ____%
</TABLE>

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

1 A 1% CDSC is imposed only on redemptions of Shares redeemed less than
one year after purchase, except for redemptions by certain
"Institutional Investors" as defined below under "SALES CHARGES --
Contingent Deferred Sales Charge ("CDSC") - Class C Shares."

2 Qualivest has agreed to temporarily waive a portion of its investment
advisory fee for the Funds for the current fiscal year. Waived fees
cannot be recovered at a future date. Absent the advisory fee waiver,
"Management Fees" as a percentage of average daily net assets would be
____% for the Large Companies Growth Fund and ____% for the Micro Cap
Fund. See "MANAGEMENT OF THE FUNDS -- Investment Adviser."

3 As a result of the payment of 12b-1 fees, long-term Shareholders of
the Funds may pay more than the economic equivalent of the maximum
front-end sales charge permitted by the National Association of
Securities Dealers, Inc.

4 Absent the waiver of the investment advisory fee, "Total Fund
Operating Expenses" as a percentage of average daily net assets would
be ____% and ____%, respectively, for the Class A and Class C Shares
of the Large Companies Growth Fund and ____% and ____%, respectively,
for the Class A and Class C Shares of the Micro Cap Fund.

The purpose of this table is to assist the prospective investor in
understanding the various costs and expenses that a Shareholder in the
Funds will bear.

Example*

An investor would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return, and (2) redemption at the end of each time
period:

- 9 -

<PAGE>

Qualivest Large Qualivest
Companies Growth Fund Micro Cap Fund
--------------------- --------------
Class A Class C Class A Class C
------- ------- ------- --------

1 Year . . . . . $ __ $ __ $ __ $ __
3 Years. . . . . $ __ $ __ $ __ $ __
_______________

* This example should not be considered a representation of future
expenses, which may be more or less than those shown. The assumed 5%
annual return is hypothetical and should not be considered a
representation of past or future annual return. Actual return may be
greater or less than the assumed amount.

INVESTMENT OBJECTIVES AND POLICIES

Under normal market conditions, each Fund will invest primarily in equity
securities, including common stocks and securities convertible into common
stocks, of companies believed by Qualivest to be characterized by sound
management and the potential for long-term capital appreciation. Each Fund
may invest in securities convertible into common stocks without regard to
the rating assigned to such securities by a nationally recognized
statistical rating organization ("NRSRO").

The Large Companies Growth Fund. The investment objective of the Large
- -------------------------------
Companies Growth Fund is to seek long-term capital appreciation. Under normal
market conditions, it intends to invest at least 65% of its total assets in
equity securities, including common stocks and securities convertible into
common stocks, of large capitalization companies. Large capitalization
companies are those companies with a market capitalization of at least
$1 billion at the time of purchase.

- 10 -

<PAGE>

may invest the Fund's assets in companies that do not demonstrate such
characteristics if Qualivest expects such companies to undergo an
acceleration in growth of earnings because of special factors such as new
management, new products, changes in consumer demand or basic changes in
the economic environment.

Qualivest analyzes each company considered for investment to determine its
source of earnings, competitive edge, management strength, and level of
industry dominance as measured by market share. At the same time,
Qualivest conducts an analysis of the financial condition of each company
and selects those prospects that demonstrate the greatest potential for
above-average capital appreciation and growth in earnings.

The Micro Cap Fund. The investment objective of the Micro Cap Fund is to
- ------------------
seek capital appreciation. Under normal market conditions, it intends to
invest at least 65% of its total assets in equity securities, including
common stocks and securities convertible into common stocks, of micro
capitalization companies, which are those companies with a market
capitalization of less than $500 million at the time of purchase. Micro
capitalization stocks may be quite volatile and subject to wide
fluctuations in both the short and medium term. As a result, the Micro Cap
Fund may be an appropriate investment only for investors who understand and
are financially able to accept greater risks.

The Micro Cap Fund seeks to achieve its investment objective by following
flexible investment policies emphasizing investment in common stocks and
securities convertible into common stocks that are, in Qualivest's opinion,
undervalued relative to other securities at the time of purchase. In
analyzing different securities, Qualivest will consider ratios of market
price to book value, ratios of market price to earnings, ratios of market
price to assets, estimated liquidating value, earnings growth rate,
management strength, and cash flow as significant factors in assessing
relative value. If in Qualivest's opinion a stock has reached a fully valued
position, it will, under most circumstances, be sold and replaced by
securities which are deemed to be undervalued in the marketplace.

- 11 -

<PAGE>

General

If the Large Companies Growth Fund owns securities issued by a company
whose market capitalization falls below $1 billion, or the Micro Cap Fund
owns securities issued by a company whose market capitalization increases
above $500 million, Qualivest may, but is not required to, sell such
securities. However, Qualivest intends to sell such securities if, in its
judgment, market conditions warrant such a sale, or if the Large Companies
Growth Fund or Micro Cap Fund would no longer be primarily invested in
common stocks and securities convertible into common stocks issued by large
capitalization companies and micro capitalization companies, respectively.
Qualivest will attempt to make such sales when market conditions are
favorable.

Each Fund also may invest up to 35% of the value of its total assets in
notes, units of real estate investment trusts, asset-backed and mortgage-
related securities, and short-term obligations (with maturities of 12
months or less) consisting of commercial paper (including variable amount
master demand notes), bankers' acceptances, certificates of deposit,
repurchase agreements, obligations issued or guaranteed by the U.S.
Government or its agencies or instrumentalities, and demand and time
deposits of domestic and foreign banks and savings and loan associations.
Each Fund also may hold securities of other investment companies and
depositary or custodial receipts representing beneficial interests in any
of the foregoing securities.

Each Fund may invest in corporate debt securities such as debt obligations
with a maturity of at least one year from the date of issue ("bonds") and
notes which are rated at the time of purchase within the four highest
rating groups assigned by an NRSRO (e.g., in the case of Moody's Investors
----
Service, Inc. ("Moody's"), Aaa, Aa, A and Baa, and in the case of Standard
& Poor's Corporation ("S&P"), AAA, AA, A and BBB), which are considered to
be investment grade or, if unrated, which Qualivest deems to present
attractive opportunities and are of comparable quality. For a description
of NRSROs and their rating symbols, see the Appendix to the Statement of
Additional Information. For a discussion of debt securities rated within
the fourth highest rating group assigned by an NRSRO, see "INVESTMENT
TECHNIQUES AND RISK FACTORS -- Medium-Grade Securities" herein.

- 12 -

<PAGE>

Subject to the foregoing policies, each Fund also may invest up to 25% of
its total assets in foreign securities either directly or through the
purchase of American Depositary Receipts and also may invest in securities
issued by foreign branches of U.S. banks and foreign banks, in Canadian
Commercial Paper, and in Europaper (U.S. dollar denominated commercial
paper of a foreign issuer). For a discussion of risks associated with
foreign securities, see "INVESTMENT TECHNIQUES AND RISK FACTORS" herein.

Consistent with the foregoing, each Fund will focus its investments in
those companies and types of companies that Qualivest believes will enable
such Fund to achieve its investment objective. Neither Fund will invest
more than 15% of its net assets in securities that are deemed to be
illiquid. During temporary defensive periods as determined by Qualivest, a
Fund may hold up to 100% of its total assets in high quality short-term
debt obligations including domestic bank certificates of deposit, bankers'
acceptances and repurchase agreements secured by U.S. Government securities
or bank instruments. However, to the extent that a Fund is so invested,
its investment objective may not be achieved during that time.

* * * *

The investment objective of each Fund is a fundamental policy and as such
may not be changed without a vote of the holders of a majority of the
outstanding Shares of that Fund. Other policies of a Fund may be changed
without a vote of the holders of a majority of outstanding Shares of that
Fund unless (i) the policy is expressly deemed to be a fundamental policy,
or (ii) the policy is expressly deemed to be changeable only by such
majority vote. There can be no assurance that the investment objective of
any Fund will be achieved.

INVESTMENT TECHNIQUES AND RISK FACTORS

Like any investment program, an investment in a Fund entails certain risks.

Micro Capitalization Securities

The Micro Cap Fund may invest in common stocks and securities convertible
into common stocks of companies with market capitalization that is low
compared to other publicly traded

- 13 -

<PAGE>

companies. Investments in larger companies present certain advantages, in
that such companies generally have greater financial resources, more
extensive research and development, manufacturing, marketing and service
capabilities, and more stability and greater depth of management and
technical personnel. Investments in smaller, less seasoned companies may
present greater opportunities for growth but also may involve greater risks
than customarily are associated with more established companies. The
securities of micro capitalization companies may be subject to more abrupt
or erratic market movements than larger, more established companies. These
companies may have limited product lines, markets or financial resources,
or they may be dependent upon a limited management group. Their securities
may be traded only in the over-the-counter market or on a regional
securities exchange. As a result, the disposition of securities to meet
redemptions may require the Micro Cap Fund to sell these securities at a
disadvantageous time, or at disadvantageous prices, or to make many small
sales over a lengthy period of time.

Put and Call Options

Each Fund may purchase put and call options on securities, and each Fund
may purchase such options on foreign currencies, subject to its applicable
investment policies, for the purposes of hedging against market risks
related to its portfolio securities and adverse movements in exchange rates
between currencies, respectively. Each Fund also may engage in writing
call options from time to time as Qualivest deems appropriate. The Funds
will write only covered call options (options on securities or currencies
owned by the particular Fund). When a portfolio security or currency
subject to a call option is sold, the Fund will effect a "closing purchase
transaction" -- the purchase of a call option on the same security or
currency with the same exercise price and expiration date as the call
option which such Fund previously has written. If such Fund is unable to
effect a closing purchase transaction, it will not be able to sell the
underlying security or currency until the option expires or that Fund
delivers the underlying security or currency upon exercise. In addition,
upon the exercise of a call option by the holder thereof, the Fund will
forego the potential benefit represented by market appreciation over the
exercise price. Under normal conditions, it is not expected that a Fund
will cause the underlying value of portfolio securities and/or currencies
subject to such options to exceed 25% of its total assets.

- 14 -

<PAGE>

A Fund, as part of its option transactions, also may purchase index put and
call options and write index options. As with options on individual
securities, a Fund will write only covered index call options. Options on
securities indices are similar to options on a security except that, rather
than the right to take or make delivery of a security at a specified price,
an option on a securities index gives the holder the right to receive, upon
exercise of the option, an amount of cash if the closing level of the
securities index upon which the option is based is greater than, in the
case of a call, or less than, in the case of a put, the exercise price of
the option.

Price movements in securities which a Fund owns or intends to purchase may
not correlate perfectly with movements in the level of an index and,
therefore, a Fund bears the risk of a loss on an index option that is not
completely offset by movements in the price of such securities. Because
index options are settled in cash, a call writer cannot determine the
amount of its settlement obligations in advance and, unlike call writing on
specific securities, cannot provide in advance for, or cover, its potential
settlement obligations by acquiring and holding the underlying securities.
A Fund may be required to segregate assets or provide an initial margin to
cover index options that would require it to pay cash upon exercise.

Foreign Securities

- 15 -

<PAGE>

Foreign companies generally are not subject to uniform accounting, auditing
and financial reporting standards comparable to those applicable to U.S.
domestic companies. There is generally less government regulation of
securities exchanges, brokers and listed companies abroad than in the U.S.
Confiscatory taxation or diplomatic developments could also affect
investment in those countries. In addition, foreign branches of U.S.
banks, foreign banks and foreign issuers may be subject to less stringent
reserve requirements and to different accounting, auditing, reporting, and
recordkeeping standards than those applicable to domestic branches of U.S.
banks and U.S. domestic issuers.

If a security is denominated in foreign currency, the value of the security
to a Fund will be affected by changes in currency exchange rates and in
exchange control regulations, and costs will be incurred in connection with
conversions between currencies. Currency risks generally increase in
lesser developed markets. Exchange rate movements can be large and can
endure for extended periods of time, affecting either favorably or
unfavorably the value of a Fund's assets.

For many foreign securities, U.S. dollar denominated American Depositary
Receipts ("ADRs"), which are traded in the United States on exchanges or
over-the-counter, are issued by domestic banks. ADRs represent the right
to receive securities of foreign issuers deposited in a domestic bank or a
correspondent bank. ADRs do not eliminate all the risk inherent in
investing in the securities of foreign issuers. However, by investing in
ADRs rather than directly in foreign issuers' stock, a Fund can avoid
currency risks during the settlement period for either purchases or sales.

Subject to its applicable investment policies, each Fund may invest in debt
securities denominated in the European Currency Unit ("ECU"), which is a
"basket" consisting of specified amounts of the currencies of certain of
the member states of the European Community. The specific amounts of
currencies comprising the ECU may be adjusted by the Council of Ministers
of the European Community to reflect changes in relative values of the
underlying currencies. Such adjustments may adversely affect holders of
ECU denominated obligations or the marketability of such securities.

- 16 -

<PAGE>

Foreign Currency Transactions

The value of the assets of a Fund as measured in U.S. dollars may be
affected favorably or unfavorably by changes in foreign currency exchange
rates and exchange control regulations, and a Fund may incur costs in
connection with conversions between various currencies. A Fund will
conduct its foreign currency exchange transactions either on a spot (i.e.,
----
cash) basis at the spot rate prevailing in the foreign currency exchange
market, or through forward contracts to purchase or sell foreign
currencies. A forward foreign currency exchange contract ("forward currency
contract") involves an obligation to purchase or sell a specific currency
at a future date at a price set at the time of the contract. The Funds may
enter into forward currency contracts in order to hedge against adverse
movements in exchange rates between currencies. However, this tends to
limit potential gains which might result from a positive change in such
currency relationships. A Fund may also hedge its foreign currency
exchange rate risk by engaging in currency financial futures and options
transactions. The forecasting of short-term currency market movements is
extremely difficult and whether such a short-term hedging strategy will be
successful is highly uncertain.

It is impossible to forecast with precision the market value of portfolio
securities at the expiration of a forward currency contract. Accordingly,
it may be necessary for a Fund to purchase additional currency on the spot
market if the market value of the security is less than the amount of
foreign currency such Fund is obligated to deliver when a decision is made
to sell the security and make delivery of the foreign currency in
settlement of a forward contract. Conversely, it may be necessary to sell
on the spot market some of the foreign currency received upon the sale of
the portfolio security if its market value exceeds the amount of foreign
currency such Fund is obligated to deliver.

- 17 -

<PAGE>

convert their holdings of foreign currencies into U.S. dollars from time to
time. Although foreign exchange dealers do not charge a fee for
conversion, they do realize a profit based on the difference (the "spread")
between the prices at which they are buying and selling various currencies.

Futures Contracts

The Funds also may enter into contracts for the future delivery of
securities or foreign currencies and futures contracts based on a specific
security, class of securities, foreign currency or an index, purchase or
sell options on any such futures contracts and engage in related closing
transactions. A futures contract on a securities index is an agreement
obligating either party to pay, and entitling the other party to receive,
while the contract is outstanding, cash payments based on the level of a
specified securities index. A Fund may engage in such futures contracts in
an effort to hedge against market risks and to manage its cash position,
but not for leveraging purposes.

Aggregate initial margin deposits for futures contracts, and premiums paid
for related options, may not exceed 5% of a Fund's total assets, and the
value of securities that are the subject of such futures and options (both
for receipt and delivery) may not exceed 33 1/3% of the market value of a
Fund's total assets. Futures transactions will be limited to the extent
necessary to maintain each Fund's qualification as a regulated investment
company.

When-Issued and Delayed-Delivery Transactions

The Funds each may purchase securities on a when-issued or delayed-delivery
basis. A Fund will engage in when-issued and delayed-delivery transactions
only for the purpose of acquiring portfolio securities consistent with its
investment objective and policies, not for investment leverage.
When-issued securities are securities purchased for delivery beyond the
normal settlement date at a stated price and yield and thereby involve a
risk that the yield obtained in the transaction will be less than those
available in the market when delivery takes place. A Fund will not pay for
such securities or start earning interest on them until they are received.
When a Fund agrees to purchase such securities, the Custodian will set
aside cash or high grade liquid debt securities equal to the amount of the
commitment in a segregated account. In

- 18 -

<PAGE>

when-issued and delayed-delivery transactions, a Fund relies on the seller
to complete the transaction; the seller's failure to do so may cause such
Fund to miss a price or yield considered to be advantageous.

Lending of Portfolio Securities

In order to generate additional income, the Funds from time to time may
lend portfolio securities to broker-dealers, banks or institutional
borrowers of securities. The Funds must receive 102% collateral in the
form of cash or U.S. Government securities. This collateral must be valued
daily by Qualivest and, should the market value of the loaned securities
increase, the borrower must furnish additional collateral to the Funds.
During the time portfolio securities are on loan, the borrower pays the
Funds any dividends or interest paid on such securities. Loans are subject
to termination by the Funds or the borrower at any time. While the Funds
do not have the right to vote securities on loan, they intend to terminate
the loan and regain the right to vote if that is considered important with
respect to the investment. In the event the borrower defaults on its
obligation to a Fund, the Fund could experience delays in recovering its
securities and possible capital losses. The Funds will only enter into
loan arrangements with broker-dealers, banks or other institutions which
Qualivest has determined to be creditworthy under guidelines established by
the Board of Trustees that permit each Fund to loan up to 33 1/3% of the
value of its total assets.

Repurchase Agreements

Securities held by a Fund may be subject to repurchase agreements. Under
the terms of a repurchase agreement, a Fund would acquire securities from
financial institutions, subject to the seller's agreement to repurchase
such securities at a mutually agreed upon date and price, which includes
interest negotiated on the basis of current short-term rates. The seller
under a repurchase agreement will be required to maintain at all times the
value of collateral held pursuant to the agreement at not less than the
repurchase price (including accrued interest). If a seller defaults on its
repurchase obligations, a Fund may suffer a loss in disposing of the
security subject to the repurchase agreement.

- 19 -

<PAGE>

Reverse Repurchase Agreements and Dollar Roll Agreements

Each Fund also may borrow funds by entering into reverse repurchase
agreements and dollar roll agreements in accordance with applicable
investment restrictions. Pursuant to such agreements, a Fund would sell
certain of its securities to financial institutions such as banks and
broker-dealers, and agree to repurchase them, or substantially similar
securities in the case of a dollar roll agreement, at a mutually agreed
upon date and price. A dollar roll agreement is identical to a reverse
repurchase agreement except for the fact that substantially similar
securities may be repurchased. At the time a Fund enters into a reverse
repurchase agreement or dollar roll agreement, it will place in a
segregated custodial account assets such as U.S. Government securities or
other liquid high grade debt securities consistent with its investment
restrictions having a value equal to the repurchase price (including
accrued interest), and will subsequently continually monitor the account to
ensure that such equivalent value is maintained at all times. Reverse
repurchase agreements and dollar roll agreements involve the risk that the
market value of securities sold by a Fund may decline below the price at
which it is obligated to repurchase the securities.

Mortgage-Related and Asset-Backed Securities

- 20 -

<PAGE>

Like mortgages underlying mortgage-backed securities, automobile sales
contracts or credit card receivables underlying asset-backed securities are
subject to prepayment, which may reduce the overall return to certificate
holders. Nevertheless, principal prepayment rates tend not to vary much
with interest rates, and the short-term nature of the underlying car loans
or other receivables tends to dampen the impact of any change in the
prepayment level. Certificate holders may also experience delays in
prepayment on the certificates if the full amounts due on underlying sales
contracts or receivables are not realized because of unanticipated legal or
administrative costs of enforcing the contracts or because of depreciation
or damage to the collateral (usually automobiles) securing certain
contracts, or other factors. In certain market conditions, asset-backed
securities may experience volatile fluctuations in value and periods of
illiquidity. If consistent with its investment objective and policies, a
Fund may invest in other asset-backed securities that may be developed in
the future.

The staff of the Securities and Exchange Commission is of the view that
certain issuers of asset-backed securities not complying with Securities
and Exchange Commission regulations are investment companies under the
Investment Company Act of 1940 (the "1940 Act"). The Funds intend to
conduct their operations in a manner consistent with this view and, among
other things, generally will not invest more than 10% of their total assets
(when combined with investments in securities of other investment
companies, if any) in the obligations of such issuers without obtaining
appropriate regulatory relief.

Medium-Grade Securities

Each Fund may invest up to 10% of its total assets in debt securities
within the fourth highest rating group assigned by an NRSRO (i.e., BBB or
----
Baa by S&P and Moody's, respectively) and comparable unrated securities.
These types of debt securities are considered by Moody's and S&P to have
some speculative characteristics, and are more vulnerable to changes in
economic conditions, higher interest rates or adverse issuer-specific
developments which are more likely to lead to a weaker capacity to make
principal and interest payments than comparable higher rated debt
securities.

Should subsequent events cause the rating of a debt security purchased by a
Fund to fall below BBB or Baa, as the case may be,

- 21 -

<PAGE>

Qualivest will consider such an event in determining whether the Fund
should continue to hold that security. In no event, however, would a Fund
be required to liquidate any such portfolio security where the Fund would
suffer a loss on the sale of such security.

U.S. Government Securities

Obligations of certain agencies and instrumentalities of the U.S.
Government are supported by the full faith and credit of the U.S. Treasury;
others are supported by the right of the issuer to borrow from the
Treasury; some are supported by the discretionary authority of the U.S.
Government to purchase the agency's obligations; and still others are
supported only by the credit of the instrumentality. No assurance can be
given that the U.S. Government would provide financial support to U.S.
Government-sponsored agencies or instrumentalities if it is not obligated
to do so by law.

Bankers' Acceptances

The Funds may invest in bankers' acceptances guaranteed by domestic and
foreign banks if at the time of investment the guarantor bank has capital,
surplus, and undivided profits in excess of $100,000,000 (as of the date of
its most recently published financial statements).

Certificates of Deposit and Time Deposits

The Funds may invest in certificates of deposit and time deposits of
domestic and foreign banks and savings and loan associations if (a) at the
time of investment the depository institution has capital, surplus, and
undivided profits in excess of $100,000,000 (as of the date of its most
recently published financial statements), or (b) the principal amount of
the instrument is insured in full by the Federal Deposit Insurance
Corporation.

The Funds may also invest in Eurodollar Certificates of Deposit, which are
U.S. dollar denominated certificates of deposit issued by offices of
foreign and domestic banks located outside the United States; Eurodollar
Time Deposits, which are U.S. dollar denominated deposits in a foreign
branch of a U.S. bank or a foreign bank; Canadian Time Deposits, which are
essentially the same as Eurodollar Time Deposits, except they are issued by
Canadian offices of major Canadian banks; and Yankee Certificates of

- 22 -

<PAGE>

Deposit, which are certificates of deposit issued by a U.S. branch of a
foreign bank denominated in U.S. dollars and held in the United States.

Commercial Paper

Each Fund may invest in short-term promissory notes issued by corporations
(including variable amount master demand notes) rated in the four highest
categories assigned by an NRSRO or, if not rated, found by Qualivest
pursuant to guidelines adopted by the Board of Trustees to be of comparable
quality. The Funds also may invest in Canadian Commercial Paper, which is
commercial paper issued by a Canadian corporation or a Canadian counterpart
of a U.S. corporation, and in Europaper, which is U.S. dollar denominated
commercial paper of a foreign issuer.

Each Fund may invest in variable amount master demand notes, which are
unsecured demand notes that permit the indebtedness thereunder to vary, and
that provide for periodic adjustments in the interest rate according to the
terms of the instrument. Although there is no secondary market in the
notes, the Funds may demand payment of principal and accrued interest at
any time. While the notes are not typically rated by credit rating
agencies, issuers of variable amount master demand notes (which are
normally manufacturing, retail, financial, and other business concerns)
must satisfy the same criteria as set forth above for commercial paper.
Qualivest will consider the earning power, cash flow, and other liquidity
ratios of the issuers of such notes and will continuously monitor their
financial status and ability to meet payment on demand. The period of time
remaining until the principal amount can be recovered under a variable
master demand note shall not exceed seven days.

Securities Issued by Other Investment Companies

Each Fund may invest up to 10% of its total assets, in shares of money
market mutual funds for cash management purposes. A Fund will incur
additional expenses due to the duplication of expenses as a result of
investing in other investment companies.

- 23 -

<PAGE>

Restricted Securities

Securities in which the Funds may invest include securities issued by
corporations without registration under the Securities Act of 1933, as
amended (the "1933 Act"), in reliance on the so-called "private placement"
exemption from registration which is afforded by Section 4(2) of the 1933
Act ("Section 4(2) securities"). Section 4(2) securities are restricted as
to disposition under the federal securities laws, and generally are sold to
institutional investors such as the Funds who agree that they are
purchasing the securities for investment and not with a view to public
distribution. Any resale must also generally be made in an exempt
transaction. Section 4(2) securities are normally resold to other
institutional investors through or with the assistance of the issuer or
investment dealers who make a market in such Section 4(2) securities, thus
providing liquidity. Pursuant to procedures adopted by the Board of
Trustees of the Trust, Qualivest may determine Section 4(2) securities to
be liquid if such securities are readily marketable. These securities may
include securities eligible for resale under Rule 144A under the 1933 Act.

VALUATION OF SHARES

The net asset value of each Fund is determined and its Shares are priced as
of the close of regular trading on the New York Stock Exchange ("NYSE")
(generally 1:00 p.m. Pacific Time) on each Business Day ("Valuation Time").
As used herein a "Business Day" is a day on which the NYSE is open for
trading, the Federal Reserve Bank of San Francisco is open, and any other
day except days on which there are insufficient changes in the value of a
Fund's portfolio securities to materially affect the Fund's net asset value
or days on which no Shares are tendered for redemption and no order to
purchase any Shares is received. Currently, the NYSE or the Federal
Reserve Bank of San Francisco is closed on the following holidays: New
Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day,
Thanksgiving and Christmas.

Net asset value per Share for a particular class for purposes of pricing
sales and redemptions is calculated by dividing the value of all securities
and other assets belonging to a Fund allocable to such class, less the
liabilities charged to that Fund allocable to such class and any
liabilities charged directly to that class, by the number of outstanding
Shares of such class.

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<PAGE>

The net asset value per Share of the Funds will fluctuate as the value of
the investment portfolio of a Fund changes.

The securities in each Fund will be valued at market value. If market
quotations are not available, the securities will be valued by a method
which the Board of Trustees believes accurately reflects fair value. For
further information about valuation of investments, see "NET ASSET VALUE"
in the Statement of Additional Information.

PURCHASING SHARES

Class A and Class C Shares may be purchased directly from the Distributor,
or through a broker-dealer who has established a dealer agreement with the
Distributor. Except as otherwise discussed below under "Other Information
Regarding Purchases" and "Auto Invest Plan," the minimum initial investment
in a Fund, based upon the public offering price, is $500 ($50 in the case
of an Individual Retirement Account ("IRA")), and there is a $100 minimum
($50 for an IRA) for subsequent purchases. Shareholders will pay the next
calculated public offering price after the receipt by the Distributor of an
order to purchase Shares, plus any applicable sales charge as described
below (see "SALES CHARGES").

By Mail

To purchase Class A or Class C Shares of the Funds by mail, complete an
Account Application Form and return it along with a check or money order
made payable to Qualivest Funds at the following address: P. O. Box 3205,
Portland, Oregon 97208 .

An Account Application Form can be obtained by calling the Trust at
1-800-743-8637.

By Telephone or by Wire

To purchase Class A or Class C Shares of the Funds by telephone or by wire,
your Account Application Form must have been previously received by the
Distributor. To place an order by telephone or by wire, call the Trust's
toll-free number 1-800-743-8637. Payment for Class A or Class C Shares
ordered by telephone may be made by check or electronic transfer and must
be received by the Custodian within the settlement requirements defined in
the Securities Exchange Act of 1934 (the "1934 Act"). If payment for the
Shares

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<PAGE>

is not received within the prescribed time periods, or if a check timely
received does not clear, the purchase will be canceled and the investor
could be liable for any losses or fees incurred. Any questions regarding
current settlement requirements or electronic payment instructions should
be directed to the Trust at 1-800-743-8637. When purchasing Class A or
Class C Shares by wire, contact the Trust for wire instructions.

Other Information Regarding Purchases

Purchases of Shares of the Funds will be executed at the next calculated
net asset value per Share following the receipt by the Trust of an order to
purchase Shares in good form ("public offering price"). In the case of
orders for the purchase of Shares placed through a broker-dealer, the
applicable public offering price will be the net asset value as so
determined, but only if the Distributor receives the order prior to the
Valuation Time for that day and transmits it to the Trust by that Valuation
Time. The broker-dealer is responsible for transmitting such orders
promptly. If the broker-dealer fails to do so, the investor's right to
that day's closing price must be settled between the investor and the
broker-dealer. Purchases of Shares of the Funds will be effected only on a
Business Day of the Funds. An order received prior to the Valuation Time on
any Business Day will be executed at the net asset value determined as of
the Valuation Time on the date of receipt. An order received after the
Valuation Time on any Business Day will be executed at the net asset value
determined as of the Valuation Time on the next Business Day of that Fund.

The minimum initial investment amount and subsequent investment amount
referred to above may be waived if purchases are made in connection with
payroll deductions, IRAs, Keogh or similar plans and for so-called "sweep"
arrangements where an investor's cash assets are periodically transferred
from an account into one of the Funds. For information on IRAs, Keogh or
similar plans, contact the Trust at 1-800-743-8637.

The Trust reserves the right to reject any order for the purchase of its
Shares in whole or in part, including purchases made through the use of
third party checks and drafts drawn on foreign financial institutions.

Depending on the terms of an investor's account, an investor may be charged
a fee in connection with transactions in Shares effected

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<PAGE>

through a broker or other agent. This Prospectus should be read in
conjunction with information regarding the terms of such an account.

Every Shareholder will receive a confirmation of, or account statement
reflecting, each new transaction in the Shareholder's account, which will
also show the total number of Shares of the respective Fund owned by the
Shareholder. Shareholders may rely on these statements in lieu of
certificates. Certificates representing Shares of the Funds will not be
issued.

Auto Invest Plan

The Qualivest Funds Auto Invest Plan enables Shareholders to make regular
monthly, bi-monthly or quarterly purchases of Class A or Class C Shares
through automatic deduction from their bank accounts (as long as the
Shareholder's bank is a member of the Automated Clearing House). With
Shareholder authorization, the Trust's Transfer Agent will deduct the
amount specified (subject to the applicable minimums) from the
Shareholder's bank account, which amount will automatically be invested in
Shares at the public offering price on the fifth and/or the twentieth day
of such month or quarter (or the next Business Day thereafter). The
required minimum initial investment for opening an account using the Auto
Invest Plan is $50; the minimum amount for subsequent investments in a Fund
is $50. To participate in the Auto Invest Plan, Shareholders should
complete the appropriate section of the Account Application Form or a
supplemental Auto Invest application that can be acquired by calling the
Trust at 1-800-743-8637. For a Shareholder to change the Auto Invest
instructions, the request must be made in writing to the Trust's
Distributor, BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-
3035 and may take up to 15 days to implement.

SALES CHARGES

Class A Shares

The public offering price of Class A Shares of the Funds equals net asset
value plus the applicable sales charge. BISYS receives this sales charge as
Distributor and may reallow it as dealer discounts and brokerage
commissions as follows:

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<PAGE>

Sales Charge as:
----------------
Size of Transaction % of Offering % of Net Dealer
at Offering Price Price Amount Invested Reallowance
- ------------------- ------------- --------------- -----------

Less than $50,000 4.50% 4.71% 4.05%
$50,000 but less than $100,000 3.75% 3.90% 3.375%
$100,000 but less than $250,000 2.50% 2.56% 2.25%
$250,000 but less than $500,000 2.00% 2.04% 1.80%
$500,000 but less than $1,000,000 1.00% 1.01% 0.90%
$1,000,000 and over 0.00% 0.00% 0.00%

An investor may obtain reduced sales charges on Class A Shares under the
circumstances described below under "Reduced Sales Charges -- Class A
Shares."

Class C Shares

Class C Shares of the Funds may be purchased for individual accounts only
in amounts of less than $500,000. There is no sales charge imposed upon
purchases of Class C Shares, but investors may be subject to a CDSC of
1.00% when Class C Shares are redeemed less than one year after purchase.
See "Contingent Deferred Sales Charge ("CDSC") -- Class C Shares" below.

Other Information

The Distributor, at its expense, will also provide additional compensation
to dealers in connection with sales of Shares of any of the Funds. Such
compensation will include financial assistance to dealers in connection
with conferences, sales or training programs for their employees, seminars
for the public, advertising campaigns regarding one or more of the Funds,
and/or other dealer-sponsored special events. In some instances, this
compensation will be made available only to certain dealers whose
representatives have sold a significant amount of such Shares.
Compensation may include payment for travel expenses, including lodging, to
various locations for meetings or seminars of a business nature.
Compensation may also include the following types of non-cash compensation
offered through promotional contests: (1) travel and lodging at vacation
locations; (2) tickets for entertainment events; and (3) merchandise. None
of the aforementioned compensation is paid for by any Fund or its
Shareholders.

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<PAGE>

Reduced Sales Charges -- Class A Shares

Sales Charge Waivers

The Distributor may waive sales charges for the purchase of Class A Shares
of a Fund by or on behalf of (1) purchasers for whom U.S. Bank or one of
its affiliates acts in a fiduciary, advisory, custodial or similar
capacity, (2) employees and retired employees (including spouses, children
and parents of employees and retired employees) of U.S. Bank, BISYS and any
affiliates thereof, (3) Trustees of the Trust, (4) directors and retired
directors (including spouses and children of directors and retired
directors) of U.S. Bank and any affiliates thereof, (5) purchasers who use
proceeds from an account for which U.S. Bank or one of its affiliates acts
in a fiduciary, advisory, custodial or similar capacity, to purchase Class
A Shares of a Fund, (6) brokers, dealers and agents who have a sales
agreement with the Distributor, and their employees (and the immediate
family members of such individuals), (7) investment advisers or financial
planners that have entered into an agreement with the Distributor and that
place trades for their own accounts or the accounts of eligible clients and
that charge a fee for their services, and clients of such investment
advisers or financial planners who place trades for their own accounts if
such accounts are linked to the master account of the investment adviser or
financial planner on the books and records of a broker or agent that has
entered into an agreement with the Distributor, and (8) orders placed on
behalf of other investment companies distributed by BISYS, The BISYS Group,
Inc., or their affiliated companies. In addition, the Distributor may
waive sales charges for the purchase of a Fund's Class A Shares with the
proceeds from the recent redemption of shares of a non-money market mutual
fund (except one of the other funds of the Trust) sold with a sales charge.
The purchase must be made within 60 days of the redemption, and the
Distributor must be notified in writing by the investor, or by his or her
financial institution, at the time the purchase is made. A copy of the
investor's account statement showing such redemption must accompany such
notice. To receive a sales charge waiver in conjunction with any of the
above categories, Shareholders must, at the time of purchase, give the
Transfer Agent or the Distributor sufficient information to permit
confirmation of qualification.

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<PAGE>

Senior Citizens Discount

The Distributor may offer a 10% reduction of sales charges for the purchase
of Class A Shares of a Fund by or on behalf of a purchaser who has attained
the age of 59 1/2 years. Any such reduction also will apply to purchases
made through the Auto Invest Plan. To receive this sales charge reduction,
Shareholders must, at the time of purchase, give the Transfer Agent or the
Distributor sufficient information to permit confirmation of qualification.
BISYS will receive a sale charge on sales of the Funds and may reallow it
as dealer discounts and brokerage commissions as follows:

Sales Charge as:
----------------
Size of Transaction % of Offering % of Net Dealer
at Offering Price Price Amount Invested Reallowance
- ------------------- ------------- --------------- -----------

Less than $50,000 4.05% 4.22% 3.65%
$50,000 but less than $100,000 3.38% 3.49% 3.04%
$100,000 but less than $250,000 2.25% 2.30% 2.03%
$250,000 but less than $500,000 1.80% 1.83% 1.62%
$500,000 but less than $1,000,000 0.90% 0.91% 0.81%
$1,000,000 and over 0.00% 0.00% 0.00%

Concurrent Purchases

For purposes of qualifying for a lower sales charge, investors have the
privilege of combining "concurrent purchases" of Class A Shares of a Fund.
For example, if a shareholder concurrently purchases Class A Shares in one
of the funds of the Trust sold with a sales charge at the total public
offering price of $25,000 and Class A Shares in another fund sold with a
sales charge at the total public offering price of $75,000, the sales
charge would be that applicable to a $100,000 purchase as shown in the
appropriate table above. The investor's "concurrent purchases" described
above shall include the combined purchases of the investor, the investor's
spouse and children under the age of 21 and the purchaser's retirement plan
accounts. To receive the applicable public offering price pursuant to this
privilege, Shareholders must, at the time of purchase, give the Transfer
Agent or the Distributor sufficient information to permit confirmation of
qualification. This privilege, however, may be modified or eliminated at
any time or from time to time by the Trust without notice.

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<PAGE>

Letters of Intent

An investor may obtain a reduced sales charge by means of a written Letter
of Intent which expresses the intention of such investor to purchase Class
A Shares of a Fund at a designated total public offering price within a
designated 13-month period. Each purchase of Class A Shares under a Letter
of Intent will be made at the net asset value plus the sales charge
applicable at the time of such purchase to a single transaction of the
total dollar amount indicated in the Letter of Intent (the "Applicable
Sales Charge"). A Letter of Intent may include purchases of Class A Shares
made not more than 90 days prior to the date such investor signs a Letter
of Intent; however, the 13-month period during which the Letter of Intent
is in effect will begin on the date of the earliest purchase to be
included. An investor will receive as a credit against his/her purchase(s)
of Shares during this ninety day period at the end of the 13-month period,
the difference, if any, between the sales load paid on previous purchases
qualifying under the Letter of Intent and the Applicable Sales Charge.

A Letter of Intent is not a binding obligation upon the investor to
purchase the full amount indicated. The minimum initial investment under a
Letter of Intent is 5% of such amount. Class A Shares purchased with the
first 5% of such amount will be held in escrow (while remaining registered
in the name of the investor) to secure payment of the higher sales charge
applicable to the Class A Shares actually purchased if the full amount
indicated is not purchased, and such escrowed Class A Shares will be
involuntarily redeemed to pay the additional sales charge, if necessary.
Dividends on escrowed Class A Shares, whether paid in cash or reinvested in
additional Class A Shares, are not subject to escrow. The escrowed Class A
Shares will not be available for disposal by the investor until all
purchases pursuant to the Letter of Intent have been made or the higher
sales charge has been paid. When the full amount indicated has been
purchased, the escrow will be released. To the extent that an investor
purchases more than the dollar amount indicated in the Letter of Intent and
qualifies for a further reduced sales charge, the sales charge will be
adjusted for the entire amount purchased at the end of the 13-month period.
The difference in sales charge will be used to purchase additional Class A
Shares of such Fund at the then current public offering price subject to
the rate of sales charge applicable to the actual amount of the aggregate
purchases. For further information about Letters of Intent, interested
investors should contact the Trust at

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<PAGE>

1-800-743-8637. This program, however, may be modified or eliminated at
any time or from time to time by the Trust without notice.

Rights of Accumulation

Pursuant to the right of accumulation, investors are permitted to purchase
Class A Shares of the Funds at the public offering price applicable to the
total of (a) the total public offering price of the Class A Shares of the
Fund then being purchased plus (b) an amount equal to the then current net
asset value of the "purchaser's combined holdings" of the Class A Shares of
all of the funds of the Trust sold with a sales charge. Class A Shares
sold to purchasers for whom U.S. Bank or one of its affiliates acts in a
fiduciary, advisory, custodial (other than retirement accounts), agency, or
similar capacity are not presently subject to a sales charge. The
"purchaser's combined holdings" described above shall include the combined
holdings of the purchaser, the purchaser's spouse and children under the
age of 21 and the purchaser's retirement plan accounts. To receive the
applicable public offering price pursuant to the right of accumulation,
Shareholders must, at the time of purchase, give the Transfer Agent or the
Distributor sufficient information to permit confirmation of qualification.
This right of accumulation, however, may be modified or eliminated at any
time or from time to time by the Trust without notice.

Contingent Deferred Sales Charge ("CDSC") -- Class C Shares

Class C Shares of the Funds which are redeemed less than one year after
purchase will be subject to a CDSC equal to one percent of an amount equal
to the lesser of the net asset value at the time of purchase of the Class C
Shares being redeemed or the net asset value of such Shares at the time of
redemption. Accordingly, a CDSC will not be imposed on amounts
representing increases in net asset value above the net asset value at the
time of purchase. In addition, a CDSC will not be assessed on Class C
Shares purchased through reinvestment of dividends or capital gains
distributions, or that are purchased by "Institutional Investors" such as
corporations, pension plans, foundations, charitable institutions,
insurance companies, banks and other banking institutions, and non-bank
fiduciaries.

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<PAGE>

Solely for purposes of determining the amount of time which has elapsed
from the time of purchase of any Class C Shares, all purchases during a
month will be aggregated and deemed to have been made on the last day of
the month. In determining whether a CDSC is applicable to a redemption,
the calculation will be made in the manner that results in the lowest
possible charge being assessed. In this regard, it will be assumed that the
redemption is first of Shares held for more than one year or Shares
acquired pursuant to reinvestment of dividends or distributions.

For example, assume an investor purchased 100 Class C Shares with a net
asset value of $10 per Share (i.e., at an aggregate net asset value of
----
$1,000) and in the eleventh month after purchase, the net asset value per
Share is $12 and, during such time, the investor has acquired five
additional Class C Shares through dividend reinvestment. If at such time
the investor makes his first redemption of 50 Class C Shares (producing
proceeds of $600), five of such Shares will not be subject to the charge
because of dividend reinvestment. With respect to the remaining 45 Class C
Shares being redeemed, the charge will be applied only to the original cost
of $10 per Share and not to the increase in net asset value of $2 per
Share.

The CDSC is waived on redemptions of Class C Shares (i) following the death
or disability (as defined in the Internal Revenue Code of 1986, as amended
(the "Code")) of a Shareholder, (ii) to the extent that the redemption
represents a minimum required distribution from an IRA or a Custodial
Account under Code Section 403(b)(7) to a Shareholder who has reached age
70 1/2, and (iii) to the extent the redemption represents the minimum
distribution from retirement plans under Code Section 401(a) where such
redemptions are necessary to make distributions to plan participants.

Factors to Consider When Selecting Class A Shares or Class C Shares of the
Funds

Before purchasing Class A Shares or Class C Shares of a Fund, investors
should consider whether, during the anticipated life of their investment in
the Fund, the accumulated Rule 12b-1 fees and potential CDSC on Class C
Shares would be less than the initial sales charge and accumulated Rule
12b-1 fees on Class A Shares purchased at the same time, and to what extent
such differential would be offset by the higher yield of Class A Shares.
In this regard, to the extent that the sales charge for the Class A Shares

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<PAGE>

is waived or reduced by one of the methods described above, investments in
Class A Shares become more desirable. The Trust will refuse all purchase
orders for individual accounts for Class C Shares of over $500,000.

Although Class A Shares are subject to a Rule 12b-1 fees, they are not
subject to the higher Rule 12b-1 fees applicable to Class C Shares. For
this reason, Class A Shares can be expected to pay correspondingly higher
dividends per Share. However, because initial sales charges are deducted
at the time of purchase, purchasers of Class A Shares that do not qualify
for waivers of or reductions in the initial sales charge would have less of
their purchase price initially invested in a Fund than purchasers of Class
C Shares. See "MANAGEMENT OF THE TRUST -- Distributor" in the Statement of
Additional Information.

Exchange Privilege

The exchange privilege enables Shareholders of Class A or C Shares of the
Funds (including Shares acquired through reinvestment of dividends and
distributions on such Shares) to exchange those Shares at net asset value
without any sales charge for Shares of the same class offered with the same
or lower sales charge by any of the Trust's other funds, provided that the
amount to be exchanged meets the applicable minimum investment requirements
and the exchange is made in states where it is legally authorized.
Exchanges for Shares of one of the Trust's other funds with a higher sales
charge may be made upon payment of the sales charge differential. Holders
of a Fund's Class A Shares or Class C Shares may not exchange their Shares
for Shares of any other class. An exchange of Class C Shares will not
affect the holding period of the Shares for purposes of the CDSC.

If Class A Shares of a fund of the Trust sold without a sales charge were
acquired by a previous exchange from Class A Shares of a fund with respect
to which a sales charge had been paid, then such Class A Shares may be
exchanged for Class A Shares of a Fund without payment of any fees or sales
charge. Under such circumstances, in order to receive a reduced sales
charge, the Shareholder must notify the Distributor that a sales charge was
originally paid and provide the Distributor with sufficient information to
permit confirmation of qualification. The foregoing exchange privilege may
be exercised only once during a calendar year and upon written request by
the Shareholder and may be

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<PAGE>

terminated or modified by the Trust at any time, or from time to time.

An exchange is considered a sale of Shares and may result in a capital gain
or loss for federal income tax purposes.

A Shareholder wishing to exchange his or her Shares may do so by contacting
the Trust at 1-800-743-8637, by contacting their broker-dealer or by
providing written instructions to the Distributor. Any Shareholder who
wishes to make an exchange should obtain and review the current prospectus
of the fund of the Trust in which the Shareholder wishes to invest before
making the exchange. For a discussion of risks associated with
unauthorized telephone exchanges, see "REDEEMING SHARES -- By Telephone"
below.

Conversion Feature

Eight years after purchase, Class C Shares will convert automatically to
Class A Shares. The purpose of the conversion is to relieve a holder of
Class C Shares of the higher ongoing expenses charged to those Shares,
after enough time has passed to allow the Distributor to recover
approximately the amount it would have received if a front-end sales charge
had been charged. The conversion from Class C Shares to Class A Shares
takes place at net asset value, as a result of which an investor receives
dollar-for-dollar the same value of Class A Shares as he or she had of
Class C Shares. The conversion occurs eight years after the beginning of
the calendar month in which the Shares are purchased. As a result of the
conversion, the converted Shares are relieved of the Rule 12b-1 fees borne
by Class C Shares, although they are subject to the Rule 12b-1 fees borne
by Class A Shares.

QUALIVEST INDIVIDUAL RETIREMENT ACCOUNTS ("IRA")

A Qualivest IRA enables individuals, even if they participate in an
employer-sponsored retirement plan, to establish their own retirement
program. Qualivest IRA contributions may be tax-deductible and earnings
are tax-deferred. Under the Tax Reform Act of 1986, the tax deductibility
of IRA contributions is restricted or eliminated for individuals who
participate in certain employer pension plans and whose annual income
exceeds certain limits. Existing IRAs and future contributions up to the
IRA maximums, whether deductible or not, still earn income on a
tax-deferred basis.

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<PAGE>

Simplified Employee Pension Plan ("SEP/IRA")

A Qualivest SEP/IRA may be established on a group basis by an employer who
wishes to sponsor a tax-sheltered retirement program by making
contributions into IRAs on behalf of all eligible employees.

Salary Reduction Simplified Employee Pension Plan ("SAR-SEP/IRA")

A Qualivest SAR-SEP/IRA offers employers with 25 or fewer eligible
employees the ability to establish a SEP/IRA that permits salary reduction
contributions. All Qualivest IRA distribution requests must be made in
writing to BISYS Fund Services. Any additional deposits to a Qualivest IRA
must distinguish the type and year of the contribution.

For more information on any of the Qualivest IRAs or other retirement plan
options available (401(k) Defined Contribution Plans, 403(b)(7) Defined
Compensation Plans, etc.), call the Trust at 1-800-743-8637. Shareholders
are advised to consult a tax adviser on Qualivest IRA contribution and
withdrawal requirements and restrictions.

REDEEMING SHARES

Shareholders may redeem their Class A Shares without charge and their Class
C Shares, subject to the CDSC described above if redeemed less than one
year after purchase, on any day that net asset value is calculated (see
"VALUATION OF SHARES"). Redemptions will be effected at the net asset value
per Share next determined after receipt by the Distributor of a redemption
request. Redemptions may be requested by mail or by telephone.

By Mail

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<PAGE>

have the proceeds mailed to a commercial bank account previously designated
on the Account Application Form. There is no charge for having redemption
proceeds mailed to a designated bank account. To change the address to
which a redemption check is to be mailed, a written request therefor must
be received by the Transfer Agent. In connection with such request, the
Transfer Agent will require a signature guarantee by an eligible guarantor
institution.

For purposes of this policy, the term "eligible guarantor institution"
shall include banks, brokers, dealers, credit unions, securities exchanges
and associations, clearing agencies and savings associations as those terms
are defined in the 1934 Act. The Transfer Agent reserves the right to
reject any signature guarantee if (1) it has reason to believe that the
signature is not genuine, (2) it has reason to believe that the transaction
would otherwise be improper, or (3) the guarantor institution is a broker
or dealer that is neither a member of a clearing corporation nor maintains
net capital of at least $100,000.

By Telephone

Shares may be redeemed by telephone if the Account Application Form
reflects that the Shareholder has elected that privilege. If the telephone
feature was not originally selected, the Shareholder must provide written
instructions to the Trust to add it. The Shareholder may have the proceeds
mailed to his or her address or mailed or wired to a commercial bank
account previously designated on the Account Application Form. Under most
circumstances, payments will be transmitted on the next Business Day. Wire
redemption requests may be made by the Shareholder by telephone to the
Trust at 1-800-743-8637. While the Transfer Agent currently does not
charge a wire redemption fee, the Transfer Agent reserves the right to
impose such a fee in the future.

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<PAGE>

recording all phone conversions, sending confirmations to Shareholders
within 72 hours of the telephone transaction, verifying the account name
and a Shareholder's account number or tax identification number and sending
redemption proceeds only to the address of record or to a previously
authorized bank account. If a Shareholder is unable to contact the Funds
by telephone, a Shareholder may also mail the redemption request to the
Distributor at the address above.

Auto Withdrawal Plan

The Auto Withdrawal Plan enables Shareholders of the Funds to make regular
monthly, bi-monthly, or quarterly redemptions of Class A or Class C Shares.
With Shareholder authorization, the Transfer Agent will automatically
redeem Class A or Class C Shares at the net asset value on the fifth and/or
twentieth day of the month or quarter (or the next Business Day thereafter)
and have the amount specified transferred according to the written
instructions of the Shareholder. Shareholders participating in this Plan
must maintain a minimum account balance of $500. The required minimum
withdrawal is $100, monthly or quarterly.

The Auto Withdrawal Plan may be modified or terminated without notice. In
addition, the Trust may suspend a Shareholder's withdrawal plan without
notice if the account contains insufficient funds to effect a withdrawal or
in the event that the account balance is less than the minimum $500 amount.

To participate in the Auto Withdrawal Plan, Shareholders should call
1-800-743-8637 for more information. Purchases of additional Class A or
Class C Shares concurrently with withdrawals may be disadvantageous to
certain Shareholders because of tax liabilities and sales charges. For a
Shareholder to change the Auto Withdrawal Plan instructions, the request
must be made in writing to the Distributor and may take up to 15 days to
implement.

Other Information Regarding Redemption of Shares

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<PAGE>

request for redemption, or within such shorter period as required by law.
To the greatest extent possible, requests from Shareholders of a Fund for
next Business Day payments upon redemption of Shares will be honored if
received in good form by the Distributor before the last Valuation Time on
a Business Day or, if received after the last Valuation Time, within two
Business Days, unless it would be disadvantageous to that Fund or its
Shareholders to sell or liquidate portfolio securities in an amount
sufficient to satisfy requests for payments in that manner.

The Trust reserves the right to redeem involuntarily, at net asset value,
the Shares of any Shareholder if, because of redemptions of Shares by or on
behalf of the Shareholder (but not as a result of the establishment of an
account with less than $500 using the Auto Invest Plan), the account of
such Shareholder has a value of less than $500. Accordingly, an investor
purchasing Shares of a Fund in only the minimum investment amount may be
subject to such involuntary redemption if the investor thereafter redeems
any Shares. Before the Trust exercises its right to redeem such Shares and
to send the proceeds to the Shareholder, the Shareholder will be given
notice that the value of the Shares in the Shareholder's account is less
than the minimum amount and will be allowed 60 days to make an additional
investment in an amount which will increase the value of the account to at
least $500.

At various times, the Trust may be requested to redeem Shares for which it
has not yet received good payment. In such circumstances, the forwarding
of proceeds may be delayed until payment has been collected for the
purchase of such Shares, which delay may be for 15 days or more. Such
delay may be avoided if Shares are purchased by wire transfer of federal
funds. The Trust intends to pay cash for all Shares redeemed, but under
abnormal conditions which make payment in cash unwise, payment may be made
wholly or partly in portfolio securities at their then market value equal
to the redemption price. In such cases, an investor may incur brokerage
costs in converting such securities to cash.

See the Statement of Additional Information ("ADDITIONAL PURCHASE AND
REDEMPTION INFORMATION") for examples of when the right of redemption may
be suspended.

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<PAGE>

MANAGEMENT OF THE FUNDS

Trustees

Overall responsibility for management of the Trust rests with its Trustees,
who are elected by the Shareholders of all of the Trust's funds. The Trust
will be managed by the Trustees in accordance with the laws of the
Commonwealth of Massachusetts governing business trusts. There are
currently six Trustees, three of whom are not "interested persons" of the
Trust within the meaning of that term under the 1940 Act. The Trustees, in
turn, elect the officers of the Trust to supervise its day-to-day
operations. The Trustees of the Trust are: George R. Landreth, David F.
Jones, John W. Judy, Raymond H. Lung, Mary Anne Houlahan and David B.
Frohnmayer.

Investment Adviser

Qualivest Capital Management, Inc., 111 S.W. Fifth Avenue, Portland, Oregon
97204, is the investment adviser of the Trust. Qualivest, a registered
investment adviser, is an affiliate of U.S. Bank, which is a wholly owned
subsidiary of U.S. Bancorp. U.S. Bancorp is a super-regional financial
services holding company organized under the laws of Oregon in 1968. U.S.
Bank, headquartered in Portland, is a national banking association
chartered in 1891. It offers a wide variety of full-service and commercial
banking operations in over 200 locations in Oregon. Other services of U.S.
Bancorp and its subsidiaries include mortgage banking, lease financing,
consumer financing, commercial finance, international banking, investment
advisory, insurance agency and credit life insurance services, brokerage
and venture capital. As of January 1, 1996, Qualivest had under management
nearly $8.0 billion in assets. It also is investment adviser to Tax-Free
Trust of Oregon, a tax-free municipal bond fund, whose assets were
approximately $310 million at that date.

Subject to the general supervision of the Trust's Board of Trustees and in
accordance with each Fund's investment objective, policies and
restrictions, Qualivest has agreed in its Investment Advisory Agreement
with the Trust to provide or arrange for the provision of a continuous
investment program for each Fund, including investment research and
management with respect to the Funds' portfolio securities, investments and
cash.

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<PAGE>

Michael Cusack is the Equity Manager primarily responsible for managing the
Large Companies Growth Fund. [INSERT RE CUSACK'S BUSINESS EXPERIENCE]

Dale E. Benson and Frank Magdlen, each an Equity Manager at Qualivest, have
primary responsibility for management of the Micro Cap Fund. Mr. Benson
has twenty-three years of investment management experience and has been
employed by Qualivest since 1973. He received a Bachelor of Arts degree
from Pacific Lutheran University and a Doctorate in History from the
University of Maine. Mr. Benson is also a Chartered Financial Analyst.
[INSERT RE MAGDLEN'S BUSINESS EXPERIENCE]

For the services provided and expenses assumed pursuant to its Investment
Advisory Agreement with the Trust, Qualivest receives a fee from each Fund,
computed daily and paid monthly, at the following annual rates of each
Fund's average daily net assets: Large Companies Growth Fund - ____%; and
Micro Cap Fund - ____%.

While the fees for the Funds are higher than the advisory fee paid by most
investment companies, the Board of Trustees believes them to be comparable
to advisory fees paid by many funds having similar objectives and policies.
Qualivest may periodically voluntarily reduce all or a portion of its
advisory fee with respect to a Fund to increase the net income of that Fund
available for distribution as dividends. The voluntary fee reduction will
cause the return of that Fund to be higher than it would otherwise be in
the absence of such reduction.

Administrator and Distributor

BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035, a
division of BISYS Group, Inc., is the administrator for each fund of the
Trust, and also acts as the Trust's principal underwriter and distributor.

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<PAGE>

Administrator may periodically voluntarily reduce all or a portion of its
administrative fee with respect to a Fund to increase the net income of
that Fund available for distribution as dividends. The voluntary fee
reduction will cause the return of that Fund to be higher than it would
otherwise be in the absence of such reduction.

The Distributor acts as agent for the Funds in the distribution of their
Shares and, in such capacity, solicits orders for the sale of Shares,
advertises, and pays the cost of advertising, office space and its
personnel involved in such activities. Under its Distribution Agreement
with the Trust, the Distributor may retain some or all of any sales charge
imposed upon the Class A or Class C Shares. It may also receive
compensation under the Distribution and Shareholder Service Plans regarding
the Class A and Class C Shares.

Other Service Providers

BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-
3035, serves as the Trust's transfer agent and dividend disbursing agent
pursuant to a Transfer Agency Agreement with the Trust and receives a fee
for such services. BISYS Fund Services Ohio, Inc. also provides certain
accounting services for each of the Funds and receives a fee for such
services. Deloitte & Touche LLP serves as independent auditors for the
Trust. United States National Bank of Oregon is the custodian of the
Funds. See "MANAGEMENT OF THE TRUST" in the Statement of Additional
Information for further information.

While BISYS Fund Services Ohio, Inc. is a distinct legal entity from BISYS
(the Trust's administrator and distributor), BISYS Fund Services Ohio, Inc.
is considered to be an affiliated person of BISYS under the 1940 Act due
to, among other things, the fact that BISYS Fund Services Ohio, Inc. is
owned by substantially the same persons that directly or indirectly own
BISYS.

Expenses

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<PAGE>

and commissions, fees of the Trustees of the Trust, Securities and Exchange
Commission fees, pricing of portfolio securities, state securities
qualification fees, costs of preparing and printing prospectuses for
regulatory purposes and for distribution to current Shareholders, outside
auditing and legal expenses, advisory and administration fees, fees and
out-of-pocket expenses of the Custodian, Transfer Agent and fund
accountant, certain insurance premiums, costs of maintenance of the Trust's
existence, costs of Shareholders' reports and meetings, and any
extraordinary expenses incurred in each Fund's operation.

As a general matter, expenses are allocated to the Class A, Class C and
Class Y Shares of the Funds on the basis of the relative net asset value of
each class. Class A Shares and Class C Shares may bear certain additional
retail transfer agency expenses. Class A and Class C Shares also bear
certain additional Shareholder service and distribution costs incurred
pursuant to the Distribution and Shareholder Service Plans described below.

The Trustees reserve the right, subject to the receipt of relevant
regulatory approvals or rulings, if needed, to allocate certain other
expenses to the Shareholders of a particular class, including Class A and
Class C Shares, on a basis other than relative net asset value, as they
deem appropriate ("Class Expenses"). In such event, Class Expenses would
be limited to: transfer agency fees identified by the Transfer Agent as
attributable to a specific class; printing and postage expenses related to
preparing and distributing materials such as Shareholder reports,
prospectuses and proxies to current Shareholders; Blue Sky registration
fees incurred by a class of Shares; Securities and Exchange Commission
registration fees incurred by a class of Shares; expenses related to
administrative personnel and services as required to support the
Shareholders of a specific class; litigation or other legal expenses
relating solely to one class of Shares; and Trustees' fees incurred as a
result of issues relating solely to one class of Shares.

Portfolio Transactions

Pursuant to the Investment Advisory Agreement, Qualivest places orders for
the purchase and sale of portfolio investments for the Funds' accounts with
brokers or dealers it selects in its discretion. Broker-dealers selected
to execute portfolio transactions for the Funds may include affiliates of
the Trust,

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<PAGE>

Qualivest or BISYS, provided the charge for any such transaction does not
exceed usual and customary levels.

Banking Laws

Federal banking laws and regulations presently prohibit a national bank or
any affiliate thereof from sponsoring, organizing or controlling a
registered open-end investment company continuously engaged in the issuance
of its shares, and generally from underwriting, selling or distributing
securities, such as Shares of the Funds.

Qualivest is a subsidiary of U.S. Bank, and it and U.S. Bank are affiliates
of a bank holding company. They are therefore subject to applicable
federal banking laws and regulations. Qualivest has been advised by its
counsel that it may perform the advisory services for the Funds required by
the Investment Advisory Agreement and, provided that they do not engage in
underwriting, selling or distribution of the Funds' Shares, Qualivest's
national bank affiliates may perform shareholder servicing activities and
may receive compensation without violating federal banking laws and
regulations.

In the event that, due to future events, Qualivest is prohibited from
acting as the Funds' investment adviser, it is probable that the Board of
Trustees would either recommend to Shareholders the selection of another
qualified adviser or, if that course of action appeared impractical, that
the Funds be liquidated.

DISTRIBUTION PLANS

Pursuant to Rule 12b-1 under the 1940 Act, the Trust has adopted
Distribution and Shareholder Service Plans with respect to the Class A
Shares of each Fund (the "Class A Plans"), as well as Distribution and
Shareholder Service Plans with respect to Class C Shares of each Fund (the
"Class C Plans" and, with the Class A Plans, the "Plans").

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<PAGE>

Shares of each Fund. As authorized by the Class A Plans, BISYS has entered
into a Rule 12b-1 Agreement with U.S. Bancorp Securities, Inc. ("USBS"), an
affiliate of Qualivest, pursuant to which USBS has agreed to provide
certain Shareholder and distribution services in connection with Class A
Shares of the Funds purchased and held by USBS for the accounts of its
customers and Class A Shares of the Funds purchased and held by customers
of USBS directly. BISYS will be compensated by the Funds in an amount
equal to its payments to USBS under the Rule 12b-1 Agreement. Such fee may
exceed the actual costs incurred by USBS in providing such services.

Pursuant to the Class C Plans, a Fund is authorized to pay or reimburse
BISYS, as Distributor of Class C Shares, (a) a distribution fee in an
amount not to exceed on an annual basis 0.75% of the average daily net
assets of Class C Shares of a Fund, and (b) a service fee in an amount not
to exceed on an annual basis 0.25% of the average daily net assets of the
Class C Shares of a Fund. Payments under the Class C Plans will be
calculated daily and paid monthly at a rate not to exceed the limits
described above, which rates are set from time to time by the Board of
Trustees. Actual distribution expenses for Class C Shares at any given
time may exceed the Rule 12b-1 fees and payments received pursuant to
CDSCs. These unrecovered amounts plus interest thereon will be carried
forward and paid from future Rule 12b-1 fees and payments received from
CDSCs. If the Class C Plans were terminated or not continued, the Trust
would not be contractually obligated to pay for any expenses not previously
reimbursed by the Trust or recovered through CDSCs.

Payments under the Plans may be used by BISYS to pay banks and their
affiliates (including U.S. Bank and its affiliates), and other
institutions, including broker-dealers (each a "Participating
Organization"), for administration, distribution, and/or Shareholder
service assistance pursuant to an agreement between BISYS and the
Participating Organization. Pursuant to the Plans, the Distributor may
enter into Rule 12b-1 Agreements with Participating Organizations for
providing Shareholder and distribution services to their customers who are
the record or beneficial owners of Shares. Such Participating
Organizations will be compensated at an annual rate of up to 0.25% of the
average daily net assets of the Class A Shares, and up to 0.25% of the
average daily net assets of the Class C Shares, held of record or
beneficially by such customers. Under the Plans, a Participating

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<PAGE>

Organization may include BISYS, its subsidiaries, and its affiliates.

Payments to the Distributor pursuant to the Plans will be used (i) to
compensate Participating Organizations for providing distribution
assistance relating to Shares, (ii) for promotional activities intended to
result in the sale of Shares, such as to pay for the preparation, printing
and distribution of prospectuses to other than current Shareholders, and
(iii) to compensate Participating Organizations for providing Shareholder
services with respect to their customers who are, from time to time,
beneficial and record holders of Shares of the Funds.

Fees paid pursuant to the Class A Plans and Class C Plans are accrued daily
and paid monthly, and are charged as expenses of Class A Shares and Class C
Shares, respectively, of a Fund as accrued.

General Information

The Plans may be terminated by a vote of a majority of the Trustees who are
not "interested persons" (as defined in the 1940 Act) of the Trust and who
have no direct or indirect financial interest in the operation of the Plans
or in any agreements related to a Plan ("Independent Trustees"), or by a
vote of a majority of the holders of the outstanding voting securities of
the class of Shares subject thereto. Any change in the Plans that would
increase materially the distribution expenses paid by a Fund requires
Shareholder approval; otherwise, the Plans may be amended by the Trustees,
including a majority of the Independent Trustees, by a vote cast in person
at a meeting called for the purpose of voting upon the amendment. As long
as either Plan is in effect, the selection or nomination of the Independent
Trustees is committed to the discretion of the Independent Trustees.

DIVIDENDS AND TAXES

Dividends

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<PAGE>

receive all income dividends and capital gains distributions in additional
full and fractional Shares at net asset value as of the date of
declaration, unless the Shareholder elects to receive dividends or
distributions in cash or elects to participate in the Qualivest Directed
Dividend Option. Such election, or any revocation thereof, must be made in
writing to the Transfer Agent at 3435 Stelzer Road, Columbus, Ohio 43219-
3035, and will become effective with respect to dividends and distributions
having record dates after its receipt by the Transfer Agent.

Directed Dividend Option

A Shareholder may elect to have all income dividends and capital gains
distributions paid by check, reinvested in the Fund or reinvested in the
same class of any of the Trust's other funds, provided the other fund is
maintained at the minimum required balance. The Directed Dividend Option
may be modified or terminated by the Trust at any time after notice to
participating Shareholders. Participation in the Directed Dividend Option
may be terminated or changed by the Shareholder at any time by writing the
Distributor. The Directed Dividend Option is not available to participants
in any of the Qualivest IRAs.

Federal Taxes

Each Fund intends to qualify annually and elect to be treated as a
regulated investment company under the Code, so that it generally will not
be subject to federal income tax on its taxable income and gains that are
distributed to Shareholders. In order to avoid a 4% federal excise tax,
each Fund intends to distribute each calendar year substantially all of its
taxable income and gains.

Distributions from a Fund's investment company taxable income (which
includes, among other items, dividends, taxable interest and the excess, if
any, of net short-term capital gains over net long-term capital losses) are
taxable to Shareholders as ordinary income. Dividends paid by the Funds to
corporate Shareholders, to the extent such dividends are attributable to
dividends received from U.S. corporations, may qualify for the dividends-
received deduction. However, the alternative minimum tax applicable to
corporations may reduce the value of the dividends-received deduction.
Distributions of net capital gains (the excess of net long-term capital
gains over net short-term capital losses), if any, designated by a Fund as
capital gain dividends, are taxable as

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<PAGE>

long-term capital gains, regardless of how long the Shareholder has held
the Fund's Shares and are not eligible for the dividends-received
deduction.

Certain dividends declared by a Fund in October, November or December and
paid during the following January will be treated as having been received
by Shareholders on December 31 in the year the distributions were declared.
Reinvested distributions will be taxable as if they had been received in
cash.

Each Fund may be required to withhold federal income tax at the rate of 31%
of all taxable distributions paid to Shareholders who fail to provide a
Fund with their correct taxpayer identification number or to make required
certifications or who have been notified by the Internal Revenue Service
("IRS") that they are subject to backup withholding. Corporate
Shareholders and certain other Shareholders specified in the Code are
exempt from backup withholding. Backup withholding is not an additional
tax and any amounts withheld may be credited against the Shareholder's
federal income tax liability.

Prior to purchasing Shares of the Funds, the impact of dividends or capital
gains distributions which are expected to be declared or have been
declared, but have not been paid, should be carefully considered. Any such
dividends or capital gains distributions paid shortly after a purchase of
Shares prior to the record date will have the effect of reducing the per
Share net asset value of the Shares by the amount of the dividends or
distributions. All or a portion of such dividends or distributions,
although in effect a return of capital, is subject to tax.

Shareholders will be furnished annually with information relating to the
nature and amounts of distributions made by a Fund.

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<PAGE>

subject to U.S. tax rules that differ significantly from those summarized
herein. Prospective Shareholders should consult their tax advisers with
respect to the effect of investing in a Fund. For additional information
relating to taxes, see "ADDITIONAL INFORMATION--Additional Tax Information"
in the Statement of Additional Information.

GENERAL INFORMATION

Organization of the Trust

The Trust was organized as a Massachusetts business trust in 1994 and
consists of seventeen funds. The Shares of each Fund are offered in three
separate classes: Class A Shares, Class C Shares and Class Y Shares.
Shares of the Trust's other funds also are offered in multiple separate
classes. Each Share represents an equal proportionate interest in a fund
with other Shares of the same fund, and is entitled to such dividends and
distributions out of the income earned on the assets belonging to that fund
as are declared at the discretion of the Trustees. Shares are without par
value. Shareholders are entitled to one vote for each dollar of value
invested and a proportionate fractional vote for any fraction of a dollar
invested. Shareholders will vote in the aggregate and not by fund except
as otherwise expressly required by law.

An annual or special meeting of Shareholders to conduct necessary business
is not required by the Trust's Declaration of Trust, the 1940 Act or other
authority except, under certain circumstances, to elect Trustees, amend the
Declaration of Trust, approve an investment advisory agreement and to
satisfy certain other requirements. To the extent that such a meeting is
not required, the Trust may elect not to have an annual or special meeting.

The Trust will call a special meeting of Shareholders for purposes of
considering the removal of one or more Trustees upon written request
therefor from Shareholders holding not less than 10% of the outstanding
votes of the Trust. At such a meeting, a quorum of Shareholders
(constituting a majority of votes attributable to all outstanding Shares of
the Trust), by majority vote, has the power to remove one or more Trustees.

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<PAGE>

Multiple Classes of Shares

In addition to Class A and Class C Shares, the Trust also offers Class Y
Shares of the Funds. Class Y Shares are sold through procedures
established by the Distributor only to certain institutional investors and
bank trust departments purchasing Shares on behalf of fiduciary, advisory,
agency, custody or other similar accounts maintained by, or on behalf of,
their customers. Class Y Shares are not sold subject to a sales load and
do not bear expenses under the Plans pertaining to Class A and Class C
Shares. The amount of dividends payable with respect to Class Y Shares will
exceed dividends on Class A and Class C Shares as a result of the Plan fees
applicable to Class A and Class C Shares and because Class A and Class C
Shares may bear additional retail transfer agency expenses. For further
details regarding eligibility requirements for the purchase of Class Y
Shares, call the Trust at 1-800-743-8637.

Each Fund intends to seek a ruling from the IRS to the effect that
differing distributions among the classes of its Shares will not result in
the Fund's dividends or other distributions being regarded as "preferential
dividends" under the Code. While similar rulings have been issued by the
IRS, complete assurance cannot, of course, be given that the Funds will
receive such rulings. For additional information, see the Statement of
Additional Information.

Performance Information

From time to time performance information for the Funds showing their
average annual total return, aggregate total return and/or yield may be
presented in advertisements, sales literature and Shareholder reports.
Such performance figures are based on historical earnings and are not
intended to indicate future performance. Also, from time to time, the
Funds may present their respective distribution rates for a class of Shares
in supplemental sales literature which is accompanied or preceded by a
prospectus and in Shareholder reports.

Standardized yield and total return quotations will be computed separately
for Class A, Class C and Class Y Shares. Because of differences in the
fees and/or expenses borne by Class A, Class C and Class Y Shares of the
Funds, the net yield and total return on Class A and Class C Shares can be
expected, at any given time, to

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<PAGE>

be lower than the net yield and total return on Class Y Shares for the same
period.

Investors also may judge the performance of any class of Shares or Fund by
comparing or referencing it to the performance of other mutual funds with
comparable investment objectives and policies through various mutual fund
or market indices such as those prepared by various services, which indices
may be published by such services or by other services or publications,
including, but not limited to, ratings published by Morningstar, Inc. In
addition to performance information, general information about the Funds
that appears in such publications may be included in advertisements, in
sales literature and in reports to Shareholders. For further information
regarding such services and publications, see "ADDITIONAL INFORMATION --
Performance Comparisons" in the Statement of Additional Information.

Total return and yield are functions of the type and quality of instruments
held in the portfolio, operating expenses, and market conditions. Any fees
charged with respect to customer accounts for investing in Shares of the
Funds will not be included in performance calculations; such fees, if
charged, will reduce the actual performance from that quoted. In addition,
if Qualivest and BISYS voluntarily reduce all or a part of their respective
fees, the total return of such Fund will be higher than it would otherwise
be in the absence of such voluntary fee reductions.

Account Services

Shareholders of the Trust may obtain current price, yield and other
performance information on the Funds or any of the Trust's funds 24 hours a
day by calling 1-800-743-8637 from any touch-tone telephone.

Miscellaneous

Shareholders will receive unaudited semi-annual reports and annual reports
audited by independent public accountants. Inquiries regarding the Trust
may be directed in writing to Qualivest Funds at 3435 Stelzer Road,
Columbus, Ohio 43219-3035, or by calling toll free 1-800-743-8637.

No person has been authorized to give any information or to make any
representations not contained in this Prospectus in connection

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<PAGE>

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 by their Distributor in any
jurisdiction in which such offering may not lawfully be made.

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<PAGE>

SUBJECT TO COMPLETION: DATED _____________

QUALIVEST FUNDS

3435 Stelzer Road
Columbus, Ohio 43219-3035
1-800-743-8637

Qualivest Funds (the "Trust") is an open-end management investment
company which offers seventeen separate diversified investment
portfolios ("funds"), each with different investment objectives and
policies. These funds enable the Trust to meet a wide range of
investment needs. This Prospectus relates only to the following funds
(the "Funds"):

- Qualivest Conservative Fund;
- Qualivest Balanced Fund;
- Qualivest Growth Fund; and
- Qualivest Aggressive Growth Fund.

Each Fund seeks its investment objective by investing in a diversified
portfolio of certain of the other funds offered by the Trust (the
"Underlying Funds").

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"),
acts as the investment adviser to each of the Funds.

Additional information about the Trust and each of the Funds, contained
in a Statement of Additional Information dated _________________, has
been filed with the Securities and Exchange Commission and is available
upon request without charge by writing to the Trust at its address or by
calling the Trust at the telephone number shown above.

The Trustees of the Trust have divided beneficial ownership of each fund
into transferable units called shares (the "Shares"). Each Fund offers
multiple classes of Shares. This Prospectus describes the Class A
Shares and Class C Shares of each Fund, which are currently offered to
the general public. Each Fund also offers a class of Shares known as
Class Y Shares to certain qualified institutional investors.

Shares of the Funds are not deposits or obligations of, and are not
endorsed, insured or guaranteed by, any bank, the Federal Deposit
Insurance Corporation, or any other agency. An investment in the Funds
involves investment risk, including the possible loss of principal.

This Prospectus sets forth concisely the information about the Funds
that a prospective investor ought to know before investing. Investors
should read this Prospectus and retain it for future reference.

<PAGE>

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

The date of this Prospectus is _______________, 1996.

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<PAGE>

TABLE OF CONTENTS

Page
----

PROSPECTUS SUMMARY . . . . . . . . . . . . . . . . . . . . . . . .
Shares Offered . . . . . . . . . . . . . . . . . . . . . . . .
Offering Price and Sales Charges . . . . . . . . . . . . . . .
Minimum Purchase . . . . . . . . . . . . . . . . . . . . . . .
Investment Objectives . . . . . . . . . . . . . . . . . . . .
Investment Policies . . . . . . . . . . . . . . . . . . . . .
Risk Factors and Special Considerations . . . . . . . . . . .
Investment Adviser . . . . . . . . . . . . . . . . . . . . . .
Dividends and Capital Gains . . . . . . . . . . . . . . . . .
Other Information . . . . . . . . . . . . . . . . . . . . . .
Guide to Investing in the Qualivest Funds . . . . . . . . . .

FUND EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . .

FEE TABLES . . . . . . . . . . . . . . . . . . . . . . . . . . . .

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . .

INVESTMENT OBJECTIVES AND POLICIES -- UNDERLYING FUNDS . . . . . .
Equity Funds . . . . . . . . . . . . . . . . . . . . . . . . .
Income Funds . . . . . . . . . . . . . . . . . . . . . . . . .
Money Funds . . . . . . . . . . . . . . . . . . . . . . . . .

UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS . . . . .
U.S. Government Obligations . . . . . . . . . . . . . . . . .
Mortgage-Related and Asset-Backed Securities . . . . . . . . .
Bankers' Acceptances . . . . . . . . . . . . . . . . . . . . .
Certificates of Deposit and Time Deposits . . . . . . . . . .
Commercial Paper . . . . . . . . . . . . . . . . . . . . . . .
Put and Call Options . . . . . . . . . . . . . . . . . . . . .
Foreign Securities . . . . . . . . . . . . . . . . . . . . . .
Foreign Currency Transactions . . . . . . . . . . . . . . . .
Repurchase Agreements . . . . . . . . . . . . . . . . . . . .
Reverse Repurchase Agreements and Dollar Roll Agreements . . .
Futures Contracts . . . . . . . . . . . . . . . . . . . . . .
When-Issued and Delayed-Delivery Transactions . . . . . . . .
Lending of Portfolio Securities . . . . . . . . . . . . . . .
Medium-Grade Securities . . . . . . . . . . . . . . . . . . .
Securities Issued by Other Investment Companies . . . . . . .
Restricted Securities . . . . . . . . . . . . . . . . . . . .

VALUATION OF SHARES . . . . . . . . . . . . . . . . . . . . . . . .

PURCHASING SHARES . . . . . . . . . . . . . . . . . . . . . . . . .
By Mail . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Telephone or by Wire . . . . . . . . . . . . . . . . . . .
Other Information Regarding Purchases . . . . . . . . . . . .

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<PAGE>

SALES CHARGES . . . . . . . . . . . . . . . . . . . . . . . . . . .
Class A Shares . . . . . . . . . . . . . . . . . . . . . . . .
Class C Shares . . . . . . . . . . . . . . . . . . . . . . . .
Other Information . . . . . . . . . . . . . . . . . . . . . .
Reduced Sales Charges -- Class A Shares . . . . . . . . . . .
Sales Charge Waivers . . . . . . . . . . . . . . . . . .
Concurrent Purchases . . . . . . . . . . . . . . . . . . . . .
Letters of Intent . . . . . . . . . . . . . . . . . . . . . .
Rights of Accumulation . . . . . . . . . . . . . . . . . . . .
Contingent Deferred Sales Charge ("CDSC") -- Class C Shares .
Factors to Consider When Selecting Class A Shares or Class C
Shares of the Funds . . . . . . . . . . . . . . . . . . .
Exchange Privilege . . . . . . . . . . . . . . . . . . . . . .
Conversion Feature . . . . . . . . . . . . . . . . . . . . . .

QUALIVEST INDIVIDUAL RETIREMENT ACCOUNTS ("IRA") . . . . . . . . .
Simplified Employee Pension Plan ("SEP/IRA") . . . . . . . . .
Salary Reduction Simplified Employee Pension Plan
("SAR-SEP/IRA") . . . . . . . . . . . . . . . . . . . . .

REDEEMING SHARES . . . . . . . . . . . . . . . . . . . . . . . . .
By Mail . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Telephone . . . . . . . . . . . . . . . . . . . . . . . . .
Auto Withdrawal Plan . . . . . . . . . . . . . . . . . . . . .
Other Information Regarding Redemption of Shares . . . . . . .

MANAGEMENT OF THE FUNDS . . . . . . . . . . . . . . . . . . . . . .
Trustees . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment Adviser . . . . . . . . . . . . . . . . . . . . . .
Administrator and Distributor . . . . . . . . . . . . . . . .
Other Service Providers . . . . . . . . . . . . . . . . . . .
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . .
Banking Laws . . . . . . . . . . . . . . . . . . . . . . . . .

DISTRIBUTION PLANS . . . . . . . . . . . . . . . . . . . . . . . .
General Information . . . . . . . . . . . . . . . . . . . . .

DIVIDENDS AND TAXES . . . . . . . . . . . . . . . . . . . . . . . .
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . .
Directed Dividend Option . . . . . . . . . . . . . . . . . . .
Federal Taxes . . . . . . . . . . . . . . . . . . . . . . . .

GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . .
Organization of the Trust . . . . . . . . . . . . . . . . . .
Multiple Classes of Shares . . . . . . . . . . . . . . . . . .
Performance Information . . . . . . . . . . . . . . . . . . .
Account Services . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . .

- 4 -

<PAGE>

PROSPECTUS SUMMARY

Shares Offered

Class A and Class C Shares of the Qualivest Conservative Fund (the
"Conservative Fund"), the Qualivest Balanced Fund (the "Balanced Fund"),
the Qualivest Growth Fund (the "Growth Fund"), and the Qualivest
Aggressive Growth Fund (the "Aggressive Growth Fund") (collectively, the
"Funds"), which are four separate diversified investment portfolios
("funds") of Qualivest Funds (the "Trust"), a Massachusetts business
trust which is registered as an open-end investment company.

Offering Price and Sales Charges

Each Fund offers investors a choice of Class A and Class C Shares, which
differ principally with respect to sales charges and the rate of
expenses to which they are subject. The public offering price of Class
A Shares of each Fund is equal to the net asset value per Share plus a
sales charge equal to ____% of the public offering price, reduced when
the total purchase amount is $____________ or more (see "SALES CHARGES
- -- Class A Shares"). Under certain circumstances, the sales charge may
be eliminated. The public offering price of Class C Shares of each Fund
is equal to the net asset value per Share, but investors may be subject
to a contingent deferred sales charge ("CDSC") of 1.00% when Class C
Shares are redeemed less than one year after purchase.

Minimum Purchase

$500 minimum initial purchase per Fund, with $100 minimum subsequent
investments. Such minimum initial investment may be waived for certain
purchasers and is reduced to $50 for investors using the Auto Invest
Plan described herein, and such investors are subject to a $50 minimum
for each subsequent investment in a Fund.

Investment Objectives

The Conservative Fund seeks to produce current income with a secondary
- ---------------------
objective of long-term capital appreciation.

The Balanced Fund seeks to provide a balance between long-term capital
- -----------------
appreciation and current income.

The Growth Fund seeks to provide capital appreciation and income growth.
- ---------------

The Aggressive Growth Fund seeks to provide maximum capital
- --------------------------
appreciation.

- 5 -

<PAGE>

Investment Policies

Each Fund seeks its investment objective by investing in a diversified
portfolio of certain of the other funds offered by the Trust (the
"Underlying Funds"). The Underlying Funds include: the Qualivest Large
Companies Value Fund (the "Large Companies Fund"), the Qualivest Small
Companies Value Fund (the "Small Companies Fund"), the Qualivest
International Opportunities Fund (the "International Fund") and the
Qualivest Optimized Stock Fund (the "Optimized Fund") (collectively, the
"Equity Funds"); the Qualivest Intermediate Bond Fund (the "Intermediate
Bond Fund") and the Qualivest Diversified Bond Fund (the "Bond Fund")
(collectively, the "Income Funds"); and the Qualivest U.S. Treasury
Money Market Fund (the "U.S. Treasury Fund") and the Qualivest Money
Market Fund (the "Money Market Fund") (collectively, the "Money Funds").
See "INVESTMENT OBJECTIVES AND POLICIES."

Risk Factors and Special Considerations

An investment in the Funds involves a certain amount of risk and may not
be suitable for all investors. See "INVESTMENT OBJECTIVES AND
POLICIES -- UNDERLYING FUNDS" and "UNDERLYING FUNDS' INVESTMENT
TECHNIQUES AND RISK FACTORS."

Investment Adviser

Dividends and Capital Gains

Dividends from net income are declared and paid quarterly for the Funds.
Net realized capital gains are distributed at least annually.

Other Information

U.S. Bank ("Custodian") is the Funds' custodian. BISYS Fund Services
("BISYS" or "Distributor" or "Administrator") serves as the distributor
and administrator of the Funds. BISYS Fund Services Ohio, Inc.
("Transfer Agent") serves as the transfer agent and dividend disbursing
agent and provides certain accounting services for the Trust.

Guide to Investing in the Qualivest Funds

Purchase orders for the Funds received by the Distributor prior to 1:00
p.m. Pacific Time will become effective that day.

- 6 -

<PAGE>

- - Minimum Initial Investment.......................... $500
(Such minimum may be reduced for certain investors.)

- - Minimum Initial Investment for
IRAs and other qualified retirement plans........... $ 50

- - Minimum Subsequent Investment....................... $100
(Such minimum may be reduced for certain investors.)

- - Minimum Subsequent Investment for IRAs
and other qualified retirement plans................ $ 50

Shareholders may exchange Shares of a Fund for Shares of the same class
of another fund of the Trust by telephone or mail. See "PURCHASING
SHARES -- Exchange Privilege" for more information.

- - Minimum Initial Exchange............................ $500
(No minimum for subsequent exchanges.)

Shareholders may redeem Shares by telephone, mail or through a Fund's
Auto Withdrawal Plan.

All dividends and distributions will be automatically reinvested at net
asset value in additional Shares of the same class of the applicable
Fund unless cash payment is requested.

See "PURCHASING SHARES" and "REDEEMING SHARES" for more information.

FUND EXPENSES

The following expense tables indicate costs and expenses that an
investor should anticipate incurring either directly or indirectly as a
Shareholder of a Fund during its first fiscal year of operations. The
numbers reflect estimated levels of operating expenses.

- 7 -

<PAGE>

<TABLE><CAPTION>
FEE TABLES

Qualivest Qualivest
Conservative Fund Balanced Fund
----------------- -------------
Class A Class C Class A Class C
------- ------- ------- -------
<S> <C> <C> <C> <C>
Shareholder Transaction Expenses

Annual Fund Operating Expenses
(as a percentage of average
net assets annualized)
Management Fees After Waiver2 . . . . . . . . . 0.00% 0.00% 0.00% 0.00%
12b-1 Fees3 . . . . . . . . . . . . . . . . . . 0.25% 1.00% 0.25% 1.00%
Other Expenses . . . . . . . . . . . . . . . . ____ ____ ____ ____

Total Fund Operating Expenses After Waiver4 . . ____% ____% ____% ____%

Qualivest Qualivest Aggressive
Growth Fund Growth Fund
------------------- -------------------
Class A Class C Class A Class C
------- ------- ------- -------
<S> <C> <C> <C> <C>
Shareholder Transaction Expenses

Maximum Sales Charge Imposed on
Purchases (as a percentage
of offering price) . . . . . . . . . . . . . . ____% None ____% None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price) . . . . . . . . None None None None
Deferred Sales Charge (as a
percentage of redemption
proceeds)1 . . . . . . . . . . . . . . . . . . None 1.00% None 1.00%
Redemption Fees (as a percentage
of redemption proceeds) . . . . . . . . . . . None None None None
Exchange Fees . . . . . . . . . . . . . . . . . None None None None
Annual Fund Operating Expenses
(as a percentage of average
net assets annualized)
Management Fees After Waiver2 . . . . . . . . . 0.00% 0.00% 0.00% 0.00%
12b-1 Fees3 . . . . . . . . . . . . . . . . . . 0.25% 1.00% 0.25% 1.00%
Other Expenses . . . . . . . . . . . . . . . . ____ ____ ____ ____

Total Fund Operating Expenses After Waiver4 . . _____% _____% _____% _____%
</TABLE>

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

1 A 1% CDSC is imposed only on redemptions of Shares redeemed less
than one year after purchase, except for redemptions by certain
"Institutional Investors" as defined below under "SALES CHARGES --
Contingent Deferred Sales Charge ("CDSC") - Class C Shares."

2 Qualivest has agreed to temporarily waive a portion of its
investment advisory fee for the Funds for the current fiscal
year. Waived fees cannot be recovered at a future date.
Absent the advisory fee waiver, "Management Fees" as a
percentage of average daily net assets would be 0.20% for each
Fund. See "MANAGEMENT OF THE FUNDS - Investment Adviser."

4. Absent the waiver of the investment advisory fee, "Total Fund
Operating Expenses" as a percentage of average daily net
assets would be % and %, respectively, for the Class
---- ----
A and Class C Shares of the Conservative Fund, % and
----
%, respectively, for the Class A and Class C Shares of the
----
Balanced Fund, % and %, respectively, for the Class A
---- ----
and Class C Shares of the Growth Fund, and % and %,
---- ----
respectively, for the Class A and Class C Shares of the
Aggressive Growth Fund. However, Qualivest has agreed to
reimburse each Fund of its operating expenses in the current
fiscal year to the extent that such expenses, exclusive of
12b-1 fees, exceed 0.25% of the Fund's average daily net
assets.

- 8 -

<PAGE>

In addition to the expenses shown above, Shareholders of the Funds will
indirectly bear their pro rata share of fees and expenses incurred by
the Underlying Funds, so that the investment returns of the Funds will
be net of the expenses of the Underlying Funds. The following chart
provides the expense ratios for each of the currently operative
Underlying Funds. Where applicable, expense ratios of the Underlying
Funds have been restated to reflect current fees.

Expense
Ratio
------

Large Companies Fund . . . . . . . . . 0.94%
Small Companies Fund . . . . . . . . . 1.11%
International Fund . . . . . . . . . . 0.81%
Optimized Fund . . . . . . . . . . . . 0.61%
Intermediate Bond Fund . . . . . . . . 0.74%
Bond Fund . . . . . . . . . . . . . . 0.62%
U.S. Treasury Fund . . . . . . . . . . 0.32%
Money Market Fund . . . . . . . . . . 0.52%

Based on these figures, the average weighted expense ratio for each
Fund, expressed as a percentage of each Fund's average daily net assets,
is estimated to be as follows: Conservative Fund - ____% (Class A
Shares) and ____% (Class C Shares); Balanced Fund - ____% (Class A
Shares) and ____% (Class C Shares); Growth Fund - ____% (Class A Shares)
and ____% (Class C Shares); and Aggressive Growth Fund - ____% (Class A
Shares) and ____% (Class C Shares). On the basis of these estimated
expense levels, an investor would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return, and (2) redemption at the end
of each time period:

Qualivest Qualivest
Conservative Fund Balanced Fund
----------------------- -------------------
Class A Class C Class A Class C
------- ------- ------- --------

1 Year . . . $ __ $ __ $ __ $ __
3 Years. . . $ __ $ __ $ __ $ __

Qualivest Qualivest Aggressive
Growth Fund Growth Fund
---------------- -------------------
Class A Class C Class A Class C
------- ------- ------- --------

1 Year . . . $ __ $ __ $ __ $ __
3 Years. . . $ __ $ __ $ __ $ __

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

* These examples should not be considered representations of future
expenses, which may be more than those shown. The assumed 5%
annual return is hypothetical and should not be
considered a representation of past or future annual return.
Actual return may be greater or less than the assumed amount.

- 9 -

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES

The Funds are designed to achieve different investment objectives and to
pursue these objectives by means of different investment strategies.
Shareholders should carefully consider their investment goals and
willingness to tolerate investment risk before investing in the Funds.

The Conservative Fund. The investment objective of the Conservative
- ---------------------
Fund is to seek to produce current income with a secondary objective of
long-term capital appreciation.

The Conservative Fund is designed for investors who want a source of
steady investment income with limited Share price fluctuation, and who
are willing to bear limited investment risk. This Fund will concentrate
its investments in Underlying Funds that invest primarily in fixed
income securities and short-term money market instruments. However, for
purposes of achieving capital appreciation and investment income, the
Conservative Fund also may invest a portion of its assets in Underlying
Funds that invest primarily in equity securities.

The Balanced Fund. The investment objective of the Balanced Fund is to
- -----------------
seek to provide a balance between long-term capital appreciation and
current income.

The Balanced Fund seeks this objective by broadly diversifying its
assets among most or all of the Underlying Funds, with emphasis placed
on investments in the Equity Funds and the Income Funds. This Fund
offers investors greater potential for capital appreciation than does
the Conservative Fund by virtue of its larger investments in the Equity
Funds, while also offering investors the potential for investment
income. This Fund may be suitable for investors seeking capital
appreciation in addition to income, and who are willing to bear some
risk of loss and Share price fluctuation inherent in equity securities.

The Growth Fund. The investment objective of the Growth Fund is to seek
- ---------------
to provide capital appreciation and income growth.

The Growth Fund is designed for investors seeking capital appreciation
primarily through an equity-oriented investment. This Fund focuses on
investments in the Equity Funds, concentrating most heavily in the Large
Companies Fund and the Optimized Fund, although it will invest in all of
the Equity Funds. The Growth Fund also may invest in each of the Income
Funds and Money Funds. However, this Fund emphasizes the potential
rewards and risks of an investment in equity securities.

- 10 -

<PAGE>

The Aggressive Growth Fund. The investment objective of the Aggressive
- --------------------------
Growth Fund is to seek to provide maximum capital appreciation.

The Aggressive Growth Fund seeks to achieve this objective by investing
substantially all of its assets in those Underlying Funds that invest
primarily in equity securities. While this Fund's investments are most
heavily weighted toward the Large Companies Fund and Optimized Fund, up
to 35% of its assets may be invested in each of the Small Companies Fund
and the International Fund. Accordingly, this Fund is oriented toward
those investors seeking long-term capital appreciation, with the
potential for greater gains but with greater risk of loss.

The Funds will invest their assets in the following Underlying Funds,
within the ranges (expressed as a percentage of each Fund's assets)
indicated below:

Aggressive
Conservative Balanced Growth Growth
Underlying Fund Fund Fund Fund Fund
- --------------- ------------ -------- ------ --------

Large Companies Fund 0-35% 0-35% 0-35% 0-50%
Small Companies Fund 0-35% 0-35% 0-35% 0-35%
International Fund 0-35% 0-35% 0-35% 0-35%
Optimized Fund 0-35% 0-35% 0-35% 0-50%
Intermediate Bond Fund 0-50% 0-35% 0-35% 0%
Bond Fund 0-50% 0-35% 0-35% 0%
U.S. Treasury Fund 0-10% 0-10% 0-10% 0%
Money Market Fund 0-10% 0-10% 0-10% 0-10%

For purposes of determining each Fund's compliance with these percentage
limitations, Qualivest will determine the value of a Fund's assets at
the time of investment.

While Qualivest intends to invest each Fund's assets in the Underlying
Funds within the ranges set forth above, and to periodically adjust the
allocations in response to economic and market conditions, each Fund has
a "neutral mix" representing the intended typical allocation of the Fund's
assets over time. Qualivest anticipates that each Fund's neutral mix
will be as follows:

Underlying Funds
----------------
Income and
Fund Equity Funds Money Funds
- ---- ------------ -----------

Conservative Fund 20% 80%
Balanced Fund 60% 40%
Growth Fund 80% 20%
Aggressive Growth Fund 100% 0%

- 11 -

<PAGE>

The investment policies set forth above are designed to assure that each
Fund maintains a consistent investment approach. However, the Funds do
not have the same investment flexibility as other mutual funds that are
not subject to these limitations. Also, because the Funds have adopted
a policy of limiting redemptions to no more than 3% of any Underlying
Fund's Shares during any month, except as necessary to meet redemption
requests by the Funds' Shareholders, the Funds may be unable to
reallocate assets among the Underlying Funds as quickly as would be
the case in the absence of this constraint.

Each Fund's investments are concentrated in the Underlying Funds, and
the investment performance of each Fund is directly related to the
performance of the Underlying Funds. The Funds will invest in the Class
Y Shares of the Underlying Funds, which are sold at net asset value per
Share with no sales charge or CDSC. See "INVESTMENT OBJECTIVES AND
POLICIES -- UNDERLYING FUNDS" for a description of the Underlying Funds
in which the Funds invest.

In addition to Shares of the Underlying Funds, for temporary cash
management purposes, each Fund may invest in short-term obligations
(with maturities of 12 months or less) consisting of commercial paper
(including variable amount master demand notes), bankers' acceptances,
certificates of deposit, repurchase agreements, obligations issued or
guaranteed by the U.S. Government or its agencies or instrumentalities,
asset-backed and mortgage-related securities, and demand and time
deposits of domestic and foreign banks and savings and loan
associations. The Funds also may hold depositary or custodial receipts
representing beneficial interests in any of the foregoing securities.
See "UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS" for a
description of these investments.

* * * *

The investment objective of each Fund is a fundamental policy and as
such may not be changed without a vote of the holders of a majority of
the outstanding Shares of that Fund. Other policies of a Fund may be
changed without a vote of the holders of a majority of outstanding
Shares of that Fund unless (i) the policy is expressly deemed to be a
fundamental policy, or (ii) the policy is expressly deemed to be
changeable only by such majority vote. There can be no assurance that
the investment objectives of any Fund will be achieved.

INVESTMENT OBJECTIVES AND POLICIES -- UNDERLYING FUNDS

The following is a description of the investment objectives and policies
of the Underlying Funds. Additional investment practices are described
in "UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK

- 12 -

<PAGE>

FACTORS," the Statement of Additional Information, and the Prospectus
for each of the Underlying Funds.

Equity Funds

Large Companies and Small Companies Funds
- -----------------------------------------

The Large Companies Fund. The investment objective of the Large
- ------------------------
Companies Fund is to seek long-term capital appreciation. It invests
primarily in common stocks and securities convertible into common stocks
of large capitalization companies. For purposes of this policy, large
capitalization companies are those with capitalization of $1 billion or
more at the time of purchase.

The Small Companies Fund. The investment objective of the Small
- ------------------------
Companies Fund is to seek capital appreciation. It invests primarily in
common stocks and securities convertible into common stocks of small-
sized companies. For purposes of this policy, small-sized companies are
those with capitalization of less than $1 billion at the time of
purchase. Smaller capitalization stocks may be quite volatile and
subject to wide fluctuations in both the short and medium term.

Each of these Underlying Funds seeks to achieve its investment objective
by following flexible investment policies emphasizing investment in
common stocks and securities convertible into common stocks (without
regard to rating by a nationally recognized statistical rating
organization ("NRSRO")) that are, in Qualivest's opinion, undervalued
relative to other securities at the time of purchase. In analyzing
different securities, Qualivest will consider various investment
oriented ratios as significant factors in assessing relative value,
including market price to book value, market price to earnings, and
market price to assets. Also considered are estimated liquidating
value, earnings growth rate, and cash flow. If in Qualivest's opinion a
stock has reached a fully valued position, it will, under most
circumstances, be sold and replaced by securities which are deemed to be
undervalued in the marketplace.

- 13 -

<PAGE>

billion at the time of purchase. If the Large Companies Fund owns
securities issued by a company whose market capitalization falls below
$1 billion, or the Small Companies Fund owns securities issued by a
company whose market capitalization increases above $1 billion,
Qualivest may, but is not required to, sell such securities. However,
Qualivest will sell such securities if, in its judgment, market
conditions warrant such a sale, or if the Large Companies Fund or Small
Companies Fund would no longer be primarily invested in common stocks
and securities convertible into common stocks issued by large
capitalization companies and small-sized companies, respectively.

Each of the Large Companies and Small Companies Funds may also invest up
to 35% of the value of its total assets in preferred stocks, notes,
units of real estate investment trusts, asset-backed and mortgage-
related securities, warrants, and short-term obligations (with
maturities of 12 months or less) consisting of commercial paper
(including variable amount master demand notes), bankers' acceptances,
certificates of deposit, repurchase agreements, obligations issued or
guaranteed by the U.S. Government or its agencies or instrumentalities,
and demand and time deposits of domestic and foreign banks and savings
and loan associations. Each of these Underlying Funds may also hold
securities of other investment companies and depositary or custodial
receipts representing beneficial interests in any of the foregoing
securities.

Each of these Underlying Funds may invest in corporate debt securities
such as debt obligations with a maturity of at least one year from the
date of issue ("bonds") and notes which are rated at the time of
purchase within the four highest rating groups assigned by an NRSRO
(e.g., in the case of Moody's Investors Service, Inc. ("Moody's"), Aaa,
----
Aa, A and Baa, and in the case of Standard & Poor's Corporation ("S&P"),
AAA, AA, A and BBB), which are considered to be investment grade or, if
unrated, which Qualivest deems to present attractive opportunities and
are of comparable quality. For a description of NRSROs and their rating
symbols, see the Appendix to the Statement of Additional Information.
For a discussion of debt securities rated within the fourth highest
rating group assigned by an NRSRO, see "UNDERLYING FUNDS' INVESTMENT
TECHNIQUES AND RISK FACTORS -- Medium-Grade Securities" herein.

Subject to the foregoing policies, each of these Underlying Funds may
also invest up to 25% of its total assets in foreign securities either
directly or through the purchase of American Depositary Receipts and may
also invest in securities issued by foreign branches of U.S. banks and
foreign banks, in Canadian Commercial Paper, and in Europaper (U.S.
dollar denominated commercial paper of a foreign issuer). For a
discussion of risks associated with foreign securities, see "UNDERLYING
FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS" herein.

- 14 -

<PAGE>

International and Optimized Funds
- ---------------------------------

The International Fund. The investment objective of the International
- ----------------------
Fund is to seek capital appreciation. It invests primarily in common
stocks and securities convertible into common stocks of companies that
are organized under the laws of countries other than the U.S.

The Optimized Fund. The investment objective of the Optimized Fund is
- ------------------
to seek capital appreciation and current income.

The International Fund and the Optimized Fund each seeks to achieve its
investment objective by investing primarily in common stocks and
securities convertible into common stocks (without regard to NRSRO
rating) of companies whose securities are listed on a specific
securities index. While the performance of the Optimized Fund may be
expected to approximate the performance of the Standard & Poor's 500
Composite Stock Price Index (the "S&P 500 Index"), Qualivest seeks to
outperform the S&P 500 Index through limited management of the Optimized
Fund's portfolio.

Under normal market conditions, at least 80% of the total assets of the
International Fund will be invested in common stocks and securities
convertible into common stocks of foreign companies whose securities are
listed on the Morgan Stanley Capital International EAFE (Europe,
Australasia, Far East) Index (the "EAFE Index"). The International Fund
will invest in the securities of issuers from at least three countries
other than the U.S. Investments are selected for inclusion in the
International Fund's portfolio primarily on the basis of market
capitalization and industry weightings, and to create an aggregate
country weighting similar to that of the EAFE Index. While Qualivest
anticipates that substantially all of the International Fund's assets
will be so invested, Qualivest may invest up to 20% of its total assets
in common stocks and securities convertible into common stocks of large
capitalization U.S. companies that Qualivest deems to present attractive
investment opportunities due to such companies' foreign business
operations.

Under normal market conditions, at least 80% of the Optimized Fund's
total assets will be invested in common stocks and securities
convertible into common stocks of companies whose securities are listed
on the S&P 500 Index. While Qualivest anticipates that substantially
all of the Optimized Fund's assets will be so invested, Qualivest may
invest up to 20% of its total assets as described below.

- 15 -

<PAGE>

superior to that of the S&P 500 Index as a whole. The S&P 500 Index is
composed of 500 common stocks chosen by S&P on a statistical basis to be
included in the index. Because of the market-value weighting, the
largest companies in the S&P 500 Index typically account for a
disproportionate share of the index. Qualivest believes that an
investment in securities of companies listed on the S&P 500 Index may be
optimized by selecting those securities whose growth and value
characteristics indicate that their performance, relative to the other
securities listed on the S&P 500 Index, will exceed the extent to which
the S&P 500 Index reflects their performance. Qualivest intends to
utilize computer modelling and other strategies to identify those stocks
that, in light of its assessment of general economic conditions,
Qualivest believes will achieve capital appreciation and current income
superior to the performance of a portfolio that merely seeks to
replicate the S&P 500 Index.

Each of the International Fund and the Optimized Fund may also invest up
to 20% of the value of its total assets in short-term obligations (with
maturities of 12 months or less) consisting of commercial paper
(including variable amount master demand notes), bankers' acceptances,
certificates of deposit, repurchase agreements, obligations issued or
guaranteed by the U.S. Government or its agencies or instrumentalities,
and demand and time deposits of domestic and foreign banks and savings
and loan associations. These Underlying Funds may also each hold
securities of other investment companies and depositary or custodial
receipts representing beneficial interests in any of the foregoing
securities.

The portfolio turnover rate for the International Fund and the Optimized
Fund is expected to be under 50%, a generally lower turnover rate than
for most other investment companies. Qualivest believes that a lower
turnover rate will reduce securities transaction costs incurred by these
Underlying Funds.

* * * *

Consistent with the foregoing, each of the Equity Funds will focus its
investments in those companies and types of companies that Qualivest
believes will enable such Underlying Fund to achieve its investment
objective. No Equity Fund will invest more than 15% of its net assets
in securities that are deemed to be illiquid. During temporary
defensive periods as determined by Qualivest, any of the Equity Funds
may hold up to 100% of its total assets in high quality (i.e., rated
----
within the top two rating categories by an NRSRO) short-term debt
obligations including domestic bank certificates of deposit, bankers'
acceptances and repurchase agreements secured by bank instruments.
However, to the extent that an Equity Fund is so invested, its
investment objective may not be achieved during that time.

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<PAGE>

Income Funds

The Intermediate Bond Fund. The investment objective of the
- --------------------------
Intermediate Bond Fund is to seek current income consistent with
preservation of capital.

The Bond Fund. The investment objective of the Bond Fund is to seek
- -------------
current income consistent with preservation of capital.

Under normal market conditions, at least 65% of the total assets of the
Intermediate Bond Fund and Bond Fund will be invested in bonds, which
for this purpose include debt obligations with a maturity of at least
one year from the date of issue. Fixed income or debt securities in
which these Underlying Funds may invest can have maturities of up to
thirty years or more. Each of these Underlying Funds may invest up to
35% of its total assets in high quality money market instruments such as
commercial paper (including variable amount master demand notes),
certificates of deposit and bankers' acceptances, variable and floating
rate notes, and asset-backed securities without regard to maturity,
except as set forth below. In addition, these Underlying Funds may
engage in certain loans of portfolio securities, repurchase agreements
and reverse repurchase agreements, and may also invest in securities of
other investment companies. The Intermediate Bond Fund will maintain a
dollar-weighted average maturity of three to seven years under ordinary
market conditions, while the Bond Fund will maintain a dollar-weighted
average maturity of approximately seven to eleven years under ordinary
market conditions.

Each of these Underlying Funds expects to invest in bonds, notes and
debentures of a wide range of U.S. corporate issuers. Such obligations,
in the case of debentures, will represent unsecured promises to pay, in
the case of notes and bonds, may be secured by mortgages on real
property or security interests in personal property and will in most
cases differ in their interest rates, maturities and times of issuance.

Each of these Underlying Funds may also invest in corporate debt
securities and convertible debt securities which are rated at the time
of purchase within the four highest rating groups assigned by an NRSRO
(e.g., in the case of Moody's, Aaa, Aa, A and Baa, and in the case of
----
S&P, AAA, AA, A and BBB), which are considered to be investment grade
or, if unrated, which Qualivest deems to present attractive
opportunities and are of comparable quality. For a description of
NRSROs and their rating symbols, see the Appendix to the Statement of
Additional Information. For a discussion of debt securities rated
within the fourth highest rating group assigned by an NRSRO, see
"UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS --
Medium-Grade Securities" herein.

Each of these Underlying Funds may hold short-term obligations (with
maturities of 12 months or less) consisting of domestic and

- 17 -

<PAGE>

foreign commercial paper rated at the time of purchase within the top
two categories by an NRSRO (e.g., "A-2" or better by S&P, "Prime-2" or
----
better by Moody's, or "F-2" or better by Fitch Investors Service
("Fitch")) or, if unrated, which Qualivest deems to present attractive
opportunities and are of comparable quality, including variable amount
master demand notes, bankers' acceptances, certificates of deposit and
time deposits of domestic and foreign branches of U.S. banks and foreign
banks, and repurchase agreements. These Underlying Funds may also
invest in securities of other investment companies or in Guaranteed
Investment Contracts ("GICs"), which are considered to be illiquid
securities.

Each of these Underlying Funds may also invest in obligations of the
Export-Import Bank of the United States, in U.S. dollar denominated
international bonds for which the primary trading market is in the
United States ("Yankee Bonds"), or for which the primary trading market
is abroad ("Eurodollar Bonds"), and in Canadian Bonds and bonds issued
by institutions, such as the World Bank and the European Economic
Community, organized for a specific purpose by two or more sovereign
governments ("Supranational Agency Bonds").

Each of these Underlying Funds expects to invest in a variety of U.S.
Treasury obligations, differing in their interest rates, maturities, and
times of issuance, as well as "stripped" U.S. Treasury obligations such
as Treasury Receipts issued by the U.S. Treasury representing either
future interest or principal payments ("Stripped Treasury Obligations"),
and mortgage-related securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities, such as the Government
National Mortgage Association ("GNMA"), the Federal National Mortgage
Association ("FNMA"), the Federal Farm Credit Bureau ("FFCB"), the
Tennessee Valley Authority ("TVA"), the Federal Home Loan Bank ("FHLB"),
the Federal Land Bank, the Federal Home Loan Mortgage Corporation
("FHLMC"), the Student Loan Marketing Association ("SLMA") and in
mortgage-related securities issued by nongovernmental entities.

Each of these Underlying Funds may invest in mortgage-related securities
which are rated at the time of purchase within the four highest rating
categories assigned by an NRSRO or, if unrated, which Qualivest deems to
present attractive opportunities and are of comparable quality, and have
mortgage obligations backing such securities, consisting of conventional
thirty year fixed rate mortgage obligations, graduated payment mortgage
obligations, fifteen year mortgage obligations and adjustable rate
mortgage obligations.

- 18 -

<PAGE>

loans. Although the market for such securities is becoming increasingly
liquid, securities issued by certain private organizations may not be
readily marketable. Neither of these Underlying Funds will purchase
mortgage-related securities or any other assets which in Qualivest's
opinion are illiquid, if as a result, more than 15% of the value of its
net assets will be illiquid.

Mortgage-related securities in which these Underlying Funds may invest
may also include collateralized mortgage obligations ("CMOs"), which are
debt obligations issued generally by finance subsidiaries or trusts that
are secured by mortgage-backed certificates, including, in many cases,
certificates issued by government-related guarantors, including GNMA,
FNMA and FHLMC, together with certain funds and other collateral.

Each of these Underlying Funds may invest in asset-backed securities
(unrelated to first mortgage loans), which represent fractional
interests in pools of leases, retail installment loans or revolving
credit receivables, both secured (such as Certificates for Automobile
Receivables or "CARS") and unsecured (such as Credit Card Receivable
Securities or "CARDS"). These assets are generally held by a trust and
payments of principal and interest or interest only are passed through
monthly or quarterly to certificate holders and may be guaranteed up to
certain amounts by letters of credit issued by a financial institution
affiliated or unaffiliated with the trustee or originator of the trust.
Asset-backed securities will be purchased only if they meet the rating
requirements set forth above or, if unrated, are deemed to be of
comparable quality by Qualivest with respect to these Underlying Funds'
investments in fixed-income securities of U.S. corporations and
mortgage-related securities.

An increase in interest rates will generally reduce the value of the
investments in these Underlying Funds, and a decline in interest rates
will generally increase the value of those investments. Depending upon
the prevailing market conditions, Qualivest may purchase debt securities
at a discount from face value, which produces a yield greater than the
coupon rate. Conversely, if debt securities are purchased at a premium
over face value, the yield will be lower than the coupon rate.

* * * *

In making investment decisions for the Income Funds, Qualivest will
consider many factors, including current yield, maturity, and yield to
maturity. Qualivest will also monitor the financial condition of the
issuers of the Income Funds' portfolio investments and may shorten the
average weighted portfolio maturity of an Income Fund, in light of each
such Underlying Fund's investment objective of preservation of capital,
if economic or market conditions warrant such action.

- 19 -

<PAGE>

Money Funds

Although each Money Fund has the same investment adviser and a similar
investment objective, its particular portfolio securities and yield may
differ due to differences in the types of permitted investments, cash
flow, and the availability of particular portfolio investments.

The U.S. Treasury Fund. The investment objective of the U.S. Treasury
- ----------------------
Fund is to seek current income consistent with liquidity and stability
of principal.

Under normal market conditions, the U.S. Treasury Fund invests at least
65% of its total assets in short-term U.S. Treasury bills, notes, and
bonds and in other obligations issued or guaranteed by the U.S.
Government. The U.S. Treasury Fund may invest up to 35% of its total
assets in other types of high quality rated money market instruments and
money market instruments that, although not rated, are deemed to be of
comparable high quality as determined by Qualivest pursuant to
guidelines adopted by the Board of Trustees.

This Underlying Fund expects that a majority of its income will be
exempt from state taxes as a result of its investing in U.S. Government
securities whose interest payments are state tax-exempt. Most states
allow for a pass-through of this tax exemption, so that the U.S.
Treasury Fund's dividend distributions may also be state tax-exempt with
respect to the income earned by it on U.S. Government securities.

The Money Market Fund. The investment objective of the Money Market
- ---------------------
Fund is to seek current income consistent with liquidity and stability
of principal.

The Money Market Fund invests in high quality rated money market
instruments and other money market instruments that, although not rated,
are deemed to be of comparable high quality as determined by Qualivest
pursuant to guidelines adopted by the Board of Trustees.

* * * *

- 20 -

<PAGE>

unrated securities deemed to be of comparable quality to securities
rated in the second highest rating categories for short-term debt
obligations ("Second Tier Securities") and not more than the greater of
1% of total assets or one million dollars is invested in the securities
of any one issuer of Second Tier Securities. In addition, no Money Fund
will invest more than 10% of its net assets in securities that are
deemed to be illiquid at the time of purchase. All securities or
instruments in which a Money Fund invests have remaining maturities of
397 calendar days (thirteen months) or less. The dollar-weighted
average maturity of the obligations in a Money Fund will not exceed 90
days.

Subject to the foregoing general limitations, the Money Funds expect to
invest in the types of securities discussed below under "INVESTMENT
TECHNIQUES AND RISK FACTORS." These securities include short-term
obligations issued or guaranteed by the U.S. Government or its agencies
or instrumentalities, short-term asset-backed and mortgage-related
securities, bankers' acceptances, certificates of deposit and time
deposits (including Eurodollar Certificates of Deposit ("ECDs"),
Eurodollar Time Deposits ("ETDs"), Canadian Time Deposits ("CTDs"), and
Yankee Certificates of Deposit ("Yankee CDs")), commercial paper
(including variable amount master demand notes), securities issued by
other money market investment companies, GICs, repurchase agreements,
reverse repurchase agreements and dollar roll agreements.

UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS

Each Fund's Share price will fluctuate in response to changes in the
Share price of one or more of the Underlying Funds, which are permitted
to engage in a wide range of investment techniques. Like any investment
program, an investment in an Underlying Fund entails certain risks.

U.S. Government Obligations

The Stripped Treasury Obligations in which the Funds may invest do not
include Certificates of Accrual on Treasury Securities ("CATS") or
Treasury Income Growth Receipts ("TIGRs"). Stripped securities are
issued at a discount to their "face value" and may exhibit greater price
volatility than ordinary debt securities because of

- 21 -

<PAGE>

the manner in which their principal and interest are returned to
investors.

Mortgage-Related and Asset-Backed Securities

Investments in these and other derivative securities will not be made
for purposes of leverage or speculation, but rather primarily for
conventional investment or hedging purposes, liquidity, flexibility and
to capitalize on market inefficiencies. Consistent with its investment
objective, restrictions and policies, each of the Funds except the
Optimized Fund and the International Fund may invest in mortgage-related
securities, which are securities representing interests in "pools" of
mortgages in which payments of both interest and principal on the
securities are made monthly. Early repayment of principal on mortgage-
related securities may expose a Fund to a lower rate of return upon
reinvestment of principal. Like other fixed-income securities, when
interest rates rise, the value of a mortgage-related security generally
will decline; however, when interest rates decline, the value of
mortgage-related securities with prepayment features may not increase as
much as other fixed-income securities. For this and other reasons, the
stated maturity of a mortgage-related security may be shortened by
unscheduled prepayments on the underlying mortgages and, accordingly, it
is not possible to predict accurately the security's return to a Fund.

Like mortgages underlying mortgage-backed securities, automobile sales
contracts or credit card receivables underlying asset-backed securities
are subject to prepayment, which may reduce the overall return to
certificate holders. Nevertheless, principal prepayment rates tend not
to vary much with interest rates, and the short-term nature of the
underlying car loans or other receivables tends to dampen the impact of
any change in the prepayment level. Certificate holders may also
experience delays in prepayment on the certificates if the full amounts
due on underlying sales contracts or receivables are not realized
because of unanticipated legal or administrative costs of enforcing the
contracts or because of depreciation or damage to the collateral
(usually automobiles) securing certain contracts, or other factors. In
certain market conditions, asset-backed securities may experience
volatile fluctuations in value and periods of illiquidity. If
consistent with its investment objective and policies, a Fund may invest
in other asset-backed securities that may be developed in the future.

The staff of the Securities and Exchange Commission is of the view that
certain issuers of asset-backed securities not complying with Securities
and Exchange Commission regulations are investment companies under the
Investment Company Act of 1940 (the "1940 Act"). The Underlying Funds
intend to conduct their operations in a manner consistent with this view
and, among other things, generally will not invest more than 10% (25%
for the Money Funds) of their total assets (when combined with
investments in securities

- 22 -

<PAGE>

of other investment companies, if any) in the obligations of such
issuers without obtaining appropriate regulatory relief.

Bankers' Acceptances

The Funds may invest in bankers' acceptances guaranteed by domestic and
foreign banks if at the time of investment the guarantor bank has
capital, surplus, and undivided profits in excess of $100,000,000 (as of
the date of its most recently published financial statements).

Certificates of Deposit and Time Deposits

The Funds may invest in certificates of deposit and time deposits of
domestic and foreign banks and savings and loan associations if (a) at
the time of investment the depository institution has capital, surplus,
and undivided profits in excess of $100,000,000 (as of the date of its
most recently published financial statements), or (b) the principal
amount of the instrument is insured in full by the Federal Deposit
Insurance Corporation.

The Funds may also invest in ECDs, which are U.S. dollar denominated
certificates of deposit issued by offices of foreign and domestic banks
located outside the United States; ETDs, which are U.S. dollar
denominated deposits in a foreign branch of a U.S. bank or a foreign
bank; CTDs, which are essentially the same as ETDs, except they are
issued by Canadian offices of major Canadian banks; and Yankee Cds,
which are certificates of deposit issued by a U.S. branch of a foreign
bank denominated in U.S. dollars and held in the United States.

None of the Money Funds will invest in excess of 10% of its net assets
in time deposits with maturities in excess of seven days which are
subject to penalties upon early withdrawal. Such time deposits include
ETDs and CTDs but do not include certificates of deposit.

Commercial Paper

Each Income Fund, each Parent Fund, the Money Market Fund, and, within
the limitations described above, the U.S. Treasury Fund may invest in
short-term promissory notes issued by corporations (including variable
amount master demand notes) rated at the time of purchase within the two
highest categories assigned by an NRSRO (e.g., A-2 or better by S&P,
----
Prime-2 or better by Moody's or F-2 or better by Fitch) or, if not
rated, found by Qualivest pursuant to guidelines adopted by the Board of
Trustees to be of comparable quality to instruments that are so rated.
The Equity Funds may invest in such instruments if rated in the four
highest categories assigned by an NRSRO or, if not rated, found by
Qualivest pursuant to guidelines adopted by the Board of Trustees to be
of comparable quality. The Money Market Fund, the Equity Funds and the
Income Funds may also invest in Canadian Commercial Paper, which is

- 23 -

<PAGE>

commercial paper issued by a Canadian corporation or a Canadian
counterpart of a U.S. corporation, and in Europaper, which is U.S.
dollar denominated commercial paper of a foreign issuer.

Each of the Funds may invest in variable amount master demand notes,
which are unsecured demand notes that permit the indebtedness thereunder
to vary, and that provide for periodic adjustments in the interest rate
according to the terms of the instrument. Although there is no
secondary market in the notes, the Funds may demand payment of principal
and accrued interest at any time. While the notes are not typically
rated by credit rating agencies, issuers of variable amount master
demand notes (which are normally manufacturing, retail, financial, and
other business concerns) must satisfy the same criteria as set forth
above for commercial paper. Qualivest will consider the earning power,
cash flow, and other liquidity ratios of the issuers of such notes and
will continuously monitor their financial status and ability to meet
payment on demand. In determining average weighted portfolio maturity,
a variable amount master demand note will be deemed to have a maturity
equal to the period of time remaining until the principal amount can be
recovered from the issuer through demand. The period of time remaining
until the principal amount can be recovered under a variable master
demand note shall not exceed seven days.

Put and Call Options

Each Equity and Income Fund may purchase put and call options on
securities, and each Equity Fund other than the Optimized Fund may
purchase such options on foreign currencies, subject to its applicable
investment policies, for the purposes of hedging against market risks
related to its portfolio securities and adverse movements in exchange
rates between currencies, respectively. Each Underlying Fund may also
engage in writing call options from time to time as Qualivest deems
appropriate. The Underlying Funds will write only covered call options
(options on securities or currencies owned by the particular Underlying
Fund). When a portfolio security or currency subject to a call option
is sold, the Underlying Fund will effect a "closing purchase
transaction" -- the purchase of a call option on the same security or
currency with the same exercise price and expiration date as the call
option which such Underlying Fund previously has written. If such
Underlying Fund is unable to effect a closing purchase transaction, it
will not be able to sell the underlying security or currency until the
option expires or that Underlying Fund delivers the underlying security
or currency upon exercise. In addition, upon the exercise of a call
option by the holder thereof, the Underlying Fund will forego the
potential benefit represented by market appreciation over the exercise
price. Under normal conditions, it is not expected that an Underlying
Fund will cause the underlying value of portfolio securities and/or
currencies subject to such options to exceed 25% of its total assets.

- 24 -

<PAGE>

An Underlying Fund, as part of its option transactions, also may
purchase index put and call options and write index options. As with
options on individual securities, an Underlying Fund will write only
covered index call options. Options on securities indices are similar
to options on a security except that, rather than the right to take or
make delivery of a security at a specified price, an option on a
securities index gives the holder the right to receive, upon exercise of
the option, an amount of cash if the closing level of the securities
index upon which the option is based is greater than, in the case of a
call, or less than, in the case of a put, the exercise price of the
option.

Price movements in securities which an Underlying Fund owns or intends
to purchase may not correlate perfectly with movements in the level of
an index and, therefore, an Underlying Fund bears the risk of a loss on
an index option that is not completely offset by movements in the price
of such securities. Because index options are settled in cash, a call
writer cannot determine the amount of its settlement obligations in
advance and, unlike call writing on specific securities, cannot provide
in advance for, or cover, its potential settlement obligations by
acquiring and holding the underlying securities. An Underlying Fund may
be required to segregate assets or provide an initial margin to cover
index options that would require it to pay cash upon exercise.

Foreign Securities

Investment in foreign securities is subject to special investment risks
that differ in some respects from those related to investments in
securities of U.S. domestic issuers. Such risks include political,
social or economic instability in the country of the issuer, the
difficulty of predicting international trade patterns, the possibility
of the imposition of exchange controls, expropriation, limits on removal
of currency or other assets, nationalization of assets, foreign
withholding and income taxation, and foreign trading practices
(including higher trading commissions, custodial charges and delayed
settlements). Such securities may be subject to greater fluctuations in
price than securities issued by U.S. corporations or issued or
guaranteed by the U.S. Government, its agencies or instrumentalities.
The markets on which such securities trade may have less volume and
liquidity, and may be more volatile than securities markets in the U.S.
In addition, there may be less publicly available information about a
foreign company than about a U.S. domiciled company. Foreign companies
generally are not subject to uniform accounting, auditing and financial
reporting standards comparable to those applicable to U.S. domestic
companies. There is generally less government regulation of securities
exchanges, brokers and listed companies abroad than in the U.S.
Confiscatory taxation or diplomatic developments could also affect
investment in those countries. In addition, foreign branches of U.S.
banks, foreign banks and foreign issuers may be subject to less
stringent reserve requirements and to different accounting, auditing,
reporting, and

- 25 -

<PAGE>

recordkeeping standards than those applicable to domestic branches of
U.S. banks and U.S. domestic issuers.

If a security is denominated in foreign currency, the value of the
security to an Underlying Fund will be affected by changes in currency
exchange rates and in exchange control regulations, and costs will be
incurred in connection with conversions between currencies. Currency
risks generally increase in lesser developed markets. Exchange rate
movements can be large and can endure for extended periods of time,
affecting either favorably or unfavorably the value of the Underlying
Funds' assets.

For many foreign securities, U.S. dollar denominated American Depositary
Receipts ("ADRs"), which are traded in the United States on exchanges or
over-the-counter, are issued by domestic banks. ADRs represent the
right to receive securities of foreign issuers deposited in a domestic
bank or a correspondent bank. ADRs do not eliminate all the risk
inherent in investing in the securities of foreign issuers. However, by
investing in ADRs rather than directly in foreign issuers' stock, an
eligible Equity Fund can avoid currency risks during the settlement
period for either purchases or sales.

Subject to its applicable investment policies, each Equity Fund other
than the Optimized Fund may invest in debt securities denominated in the
European Currency Unit ("ECU"), which is a "basket" consisting of
specified amounts of the currencies of certain of the member states of
the European Community. The specific amounts of currencies comprising
the ECU may be adjusted by the Council of Ministers of the European
Community to reflect changes in relative values of the underlying
currencies. Such adjustments may adversely affect holders of ECU
denominated obligations or the marketability of such securities.

Foreign Currency Transactions

The value of the assets of an Equity Fund other than the Optimized Fund
as measured in U.S. dollars may be affected favorably or unfavorably by
changes in foreign currency exchange rates and exchange control
regulations, and an Underlying Fund may incur costs in connection with
conversions between various currencies. An Equity Fund will conduct its
foreign currency exchange transactions either on a spot (i.e., cash)
----
basis at the spot rate prevailing in the foreign currency exchange
market, or through forward contracts to purchase or sell foreign
currencies. A forward foreign currency exchange contract ("forward
currency contract") involves an obligation to purchase or sell a
specific currency at a future date at a price set at the time of the
contract. The Equity Funds may enter into forward currency contracts in
order to hedge against adverse movements in exchange rates between
currencies. However, this tends to limit potential gains which might
result from a positive change in such currency relationships. An Equity
Fund may also hedge its foreign currency exchange rate

- 26 -

<PAGE>

risk by engaging in currency financial futures and options transactions.
The forecasting of short-term currency market movements is extremely
difficult and whether such a short-term hedging strategy will be
successful is highly uncertain.

It is impossible to forecast with precision the market value of
portfolio securities at the expiration of a forward currency contract.
Accordingly, it may be necessary for an Equity Fund to purchase
additional currency on the spot market if the market value of the
security is less than the amount of foreign currency such Underlying
Fund is obligated to deliver when a decision is made to sell the
security and make delivery of the foreign currency in settlement of a
forward contract. Conversely, it may be necessary to sell on the spot
market some of the foreign currency received upon the sale of the
portfolio security if its market value exceeds the amount of foreign
currency such Underlying Fund is obligated to deliver.

If an Equity Fund retains the portfolio security and engages in an
offsetting transaction, it will incur a gain or a loss to the extent
that there has been movement in forward currency contract prices. If an
Equity Fund engages in an offsetting transaction, it may subsequently
enter into a new forward currency contract to sell the foreign currency.
Although such contracts tend to minimize the risk of loss due to a
decline in the value of the hedged currency, they also tend to limit any
potential gain which might result should the value of such currency
increase. The Equity Funds will have to convert their holdings of
foreign currencies into U.S. dollars from time to time. Although
foreign exchange dealers do not charge a fee for conversion, they do
realize a profit based on the difference (the "spread") between the
prices at which they are buying and selling various currencies.

Repurchase Agreements

Securities held by a Fund (other than the U.S. Treasury Fund) may be
subject to repurchase agreements. Under the terms of a repurchase
agreement, a Fund would acquire securities from financial institutions,
subject to the seller's agreement to repurchase such securities at a
mutually agreed upon date and price, which includes interest negotiated
on the basis of current short-term rates. The seller under a repurchase
agreement will be required to maintain at all times the value of
collateral held pursuant to the agreement at not less than the
repurchase price (including accrued interest). If a seller defaults on
its repurchase obligations, a Fund may suffer a loss in disposing of the
security subject to the repurchase agreement.

- 27 -

<PAGE>

Reverse Repurchase Agreements and Dollar Roll Agreements

Each of the Underlying Funds may also borrow funds by entering into
reverse repurchase agreements and dollar roll agreements in accordance
with applicable investment restrictions. Pursuant to such agreements,
an Underlying Fund would sell certain of its securities to financial
institutions such as banks and broker-dealers, and agree to repurchase
them, or substantially similar securities in the case of a dollar roll
agreement, at a mutually agreed upon date and price. A dollar roll
agreement is identical to a reverse repurchase agreement except for the
fact that substantially similar securities may be repurchased. At the
time an Underlying Fund enters into a reverse repurchase agreement or
dollar roll agreement, it will place in a segregated custodial account
assets such as U.S. Government securities or other liquid high grade
debt securities consistent with its investment restrictions having a
value equal to the repurchase price (including accrued interest), and
will subsequently continually monitor the account to ensure that such
equivalent value is maintained at all times. Reverse repurchase
agreements and dollar roll agreements involve the risk that the market
value of securities sold by an Underlying Fund may decline below the
price at which it is obligated to repurchase the securities.

Futures Contracts

The Equity and Income Funds may also enter into contracts for the future
delivery of securities or foreign currencies and futures contracts based
on a specific security, class of securities, foreign currency or an
index, purchase or sell options on any such futures contracts and engage
in related closing transactions. A futures contract on a securities
index is an agreement obligating either party to pay, and entitling the
other party to receive, while the contract is outstanding, cash payments
based on the level of a specified securities index. An Underlying Fund
may engage in such futures contracts in an effort to hedge against
market risks and to manage its cash position, but not for leveraging
purposes.

Aggregate initial margin deposits for futures contracts, and premiums
paid for related options, may not exceed 5% of an Underlying Fund's
total assets, and the value of securities that are the subject of such
futures and options (both for receipt and delivery) may not exceed 33
1/3% of the market value of an Underlying Fund's total assets. Futures
transactions will be limited to the extent necessary to maintain each
Underlying Fund's qualification as a regulated investment company.

When-Issued and Delayed-Delivery Transactions

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<PAGE>

objective and policies, not for investment leverage. When-issued
securities are securities purchased for delivery beyond the normal
settlement date at a stated price and yield and thereby involve a risk
that the yield obtained in the transaction will be less than those
available in the market when delivery takes place. An Underlying Fund
will not pay for such securities or start earning interest on them until
they are received. When an Underlying Fund agrees to purchase such
securities, its Custodian will set aside cash or high grade liquid debt
securities equal to the amount of the commitment in a segregated
account. In when-issued and delayed-delivery transactions, an
Underlying Fund relies on the seller to complete the transaction; the
seller's failure to do so may cause such Underlying Fund to miss a price
or yield considered to be advantageous.

Lending of Portfolio Securities

In order to generate additional income, the Equity Funds and the Income
Funds from time to time may lend portfolio securities to broker-dealers,
banks or institutional borrowers of securities. The Underlying Funds
must receive 102% collateral in the form of cash or U.S. Government
securities. This collateral must be valued daily by Qualivest and,
should the market value of the loaned securities increase, the borrower
must furnish additional collateral to the Underlying Funds. During the
time portfolio securities are on loan, the borrower pays the Underlying
Funds any dividends or interest paid on such securities. Loans are
subject to termination by the Underlying Funds or the borrower at any
time. While the Underlying Funds do not have the right to vote
securities on loan, they intend to terminate the loan and regain the
right to vote if that is considered important with respect to the
investment. In the event the borrower defaults on its obligation to an
Underlying Fund, the Underlying Fund could experience delays in
recovering its securities and possible capital losses. The Underlying
Funds will only enter into loan arrangements with broker-dealers, banks
or other institutions which Qualivest has determined to be creditworthy
under guidelines established by the Board of Trustees that permit each
Underlying Fund to loan up to 33 1/3% of the value of its total assets.

Medium-Grade Securities

Each of the Income Funds, the Large Companies Fund and the Small
Companies Fund may invest up to 10% of its total assets in debt
securities within the fourth highest rating group assigned by an NRSRO
(i.e., BBB or Baa by S&P and Moody's, respectively) and comparable
----
unrated securities. These types of debt securities are considered by
Moody's and S&P to have some speculative characteristics, and are more
vulnerable to changes in economic conditions, higher interest rates or
adverse issuer-specific developments which are more likely to lead to a
weaker capacity to make principal and interest payments than comparable
higher rated debt securities.

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<PAGE>

Should subsequent events cause the rating of a debt security purchased
by one of the Underlying Funds to fall below BBB or Baa, as the case may
be, Qualivest will consider such an event in determining whether an
Underlying Fund should continue to hold that security. In no event,
however, would a Fund be required to liquidate any such portfolio
security where the Fund would suffer a loss on the sale of such
security.

Securities Issued by Other Investment Companies

Each of the Equity and Income Funds may invest up to 10% of its total
assets, and each of the Money Funds may invest up to 25% of its total
assets, in shares of money market mutual funds for cash management
purposes. The U.S. Treasury Fund expects to make such purchases only in
money market funds that restrict their investments to U.S. Government
securities. An Underlying Fund will incur additional expenses due to
the duplication of expenses as a result of investing in other investment
companies.

Restricted Securities

Securities in which the Underlying Funds may invest include securities
issued by corporations without registration under the Securities Act of
1933, as amended (the "1933 Act"), in reliance on the so-called "private
placement" exemption from registration which is afforded by Section 4(2)
of the 1933 Act ("Section 4(2) securities"). Section 4(2) securities
are restricted as to disposition under the federal securities laws, and
generally are sold to institutional investors such as the Underlying
Funds who agree that they are purchasing the securities for investment
and not with a view to public distribution. Any resale must also
generally be made in an exempt transaction. Section 4(2) securities are
normally resold to other institutional investors through or with the
assistance of the issuer or investment dealers who make a market in such
Section 4(2) securities, thus providing liquidity. Pursuant to
procedures adopted by the Board of Trustees of the Trust, Qualivest may
determine Section 4(2) securities to be liquid if such securities are
readily marketable. These securities may include securities eligible
for resale under Rule 144A under the 1933 Act.

VALUATION OF SHARES

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<PAGE>

order to purchase any Shares is received. Currently, the NYSE or the
Federal Reserve Bank of San Francisco is closed on the following
holidays: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Columbus Day,
Veterans Day, Thanksgiving and Christmas.

Net asset value per Share for a particular class for purposes of pricing
sales and redemptions is calculated by dividing the value of all
securities and other assets belonging to a Fund allocable to such class,
less the liabilities charged to that Fund allocable to such class and
any liabilities charged directly to that class, by the number of
outstanding Shares of such class.

The net asset value per Share of the Funds will fluctuate as the value
of the investment portfolio of a Fund changes.

PURCHASING SHARES

Class A and Class C Shares may be purchased directly from the
Distributor, or through a broker-dealer who has established a dealer
agreement with the Distributor. Except as otherwise discussed below
under "Other Information Regarding Purchases" and "Auto Invest Plan,"
the minimum initial investment in a Fund, based upon the public offering
price, is $500 ($50 in the case of an Individual Retirement Account
("IRA")), and there is a $100 minimum ($50 for an IRA) for subsequent
purchases. Shareholders will pay the next calculated public offering
price after the receipt by the Distributor of an order to purchase
Shares, plus any applicable sales charge as described below (see "SALES
CHARGES").

By Mail

To purchase Class A or Class C Shares of any of the Funds by mail,
complete an Account Application Form and return it along with a check or
money order made payable to Qualivest Funds at the following address:
P. O. Box 3205, Portland, Oregon 97208.

An Account Application Form can be obtained by calling the Trust at
1-800-743-8637.

By Telephone or by Wire

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<PAGE>

losses or fees incurred. Any questions regarding current settlement
requirements or electronic payment instructions should be directed to
the Trust at 1-800-743-8637. When purchasing Class A or Class C Shares
by wire, contact the Trust for wire instructions.

Other Information Regarding Purchases

Purchases of Shares of the Funds will be executed at the next calculated
net asset value per Share following the receipt by the Trust of an order
to purchase Shares in good form ("public offering price"). In the case
of orders for the purchase of Shares placed through a broker-dealer, the
applicable public offering price will be the net asset value as so
determined, but only if the Distributor receives the order prior to the
Valuation Time for that day and transmits it to the Trust by that
Valuation Time. The broker-dealer is responsible for transmitting such
orders promptly. If the broker-dealer fails to do so, the investor's
right to that day's closing price must be settled between the investor
and the broker-dealer. Purchases of Shares of any of the Funds will be
effected only on a Business Day of the Funds. An order received prior
to the Valuation Time on any Business Day will be executed at the net
asset value determined as of the Valuation Time on the date of receipt.
An order received after the Valuation Time on any Business Day will be
executed at the net asset value determined as of the Valuation Time on
the next Business Day of that Fund.

The minimum initial investment amount and subsequent investment amount
referred to above may be waived if purchases are made in connection with
payroll deductions, IRAs, Keogh or similar plans and for so-called
"sweep" arrangements where an investor's cash assets are periodically
transferred from an account into one of the Funds. For information on
IRAs, Keogh or similar plans, contact the Trust at 1-800-743-8637.

The Trust reserves the right to reject any order for the purchase of its
Shares in whole or in part, including purchases made through the use of
third party checks and drafts drawn on foreign financial institutions.

Depending on the terms of an investor's account, an investor may be
charged a fee in connection with transactions in Shares effected through
a broker or other agent. This Prospectus should be read in conjunction
with information regarding the terms of such an account.

Every Shareholder will receive a confirmation of, or account statement
reflecting, each new transaction in the Shareholder's account, which
will also show the total number of Shares of the respective Fund owned
by the Shareholder. Shareholders may rely on these statements in lieu
of certificates. Certificates representing Shares of the Funds will not
be issued.

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<PAGE>

Auto Invest Plan

The Qualivest Funds Auto Invest Plan enables Shareholders to make
regular monthly, bi-monthly or quarterly purchases of Class A or Class C
Shares through automatic deduction from their bank accounts (as long as
the Shareholder's bank is a member of the Automated Clearing House).
With Shareholder authorization, the Trust's Transfer Agent will deduct
the amount specified (subject to the applicable minimums) from the
Shareholder's bank account, which amount will automatically be invested
in Shares at the public offering price on the fifth and/or the twentieth
day of such month or quarter (or the next Business Day thereafter). The
required minimum initial investment for opening an account using the
Auto Invest Plan is $50; the minimum amount for subsequent investments
in a Fund is $50. To participate in the Auto Invest Plan, Shareholders
should complete the appropriate section of the Account Application Form
or a supplemental Auto Invest application that can be acquired by
calling the Trust at 1-800-743-8637. For a Shareholder to change the
Auto Invest instructions, the request must be made in writing to the
Trust's Distributor, BISYS Fund Services, 3435 Stelzer Road, Columbus,
Ohio 43219-3035 and may take up to 15 days to implement.

SALES CHARGES

Class A Shares

The public offering price of Class A Shares of the Funds equals net
asset value plus the applicable sales charge. BISYS receives this sales
charge as Distributor and may reallow it as dealer discounts and
brokerage commissions as follows:

Sales Charge as:
----------------
Size of Transaction % of Offering % of Net Dealer
at Offering Price Price Amount Invested Reallowance
- ------------------- ------------- --------------- -----------

Less than $50,000 ____% ____% ____%
$50,000 but less than $100,000 ____% ____% ____%
$100,000 but less than $250,000 ____% ____% ____%
$250,000 but less than $500,000 ____% ____% ____%
$500,000 but less than $1,000,000 ____% ____% ____%
$1,000,000 and over ____% ____% ____%

An investor may obtain reduced sales charges on Class A Shares under the
circumstances described below under "Reduced Sales Charges -- Class A
Shares."

Class C Shares

Class C Shares of the Funds may be purchased for individual accounts
only in amounts of less than $500,000. There is no sales charge imposed
upon purchases of Class C Shares, but investors may be subject to a CDSC
of 1.00% when Class C Shares are redeemed less

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<PAGE>

than one year after purchase. See "Contingent Deferred Sales Charge
("CDSC") -- Class C Shares" below.

Other Information

The Distributor, at its expense, will also provide additional
compensation to dealers in connection with sales of Shares of any of the
Funds. Such compensation will include financial assistance to dealers
in connection with conferences, sales or training programs for their
employees, seminars for the public, advertising campaigns regarding one
or more of the Funds, and/or other dealer-sponsored special events. In
some instances, this compensation will be made available only to certain
dealers whose representatives have sold a significant amount of such
Shares. Compensation may include payment for travel expenses, including
lodging, to various locations for meetings or seminars of a business
nature. Compensation may also include the following types of non-cash
compensation offered through promotional contests: (1) travel and
lodging at vacation locations; (2) tickets for entertainment events; and
(3) merchandise. None of the aforementioned compensation is paid for by
any Fund or its Shareholders.

Reduced Sales Charges -- Class A Shares

Sales Charge Waivers

The Distributor may waive sales charges for the purchase of Class A
Shares of a Fund by or on behalf of (1) purchasers for whom U.S. Bank or
one of its affiliates acts in a fiduciary, advisory, custodial or
similar capacity, (2) employees and retired employees (including
spouses, children and parents of employees and retired employees) of
U.S. Bank, BISYS and any affiliates thereof, (3) Trustees of the Trust,
(4) directors and retired directors (including spouses and children of
directors and retired directors) of U.S. Bank and any affiliates
thereof, (5) purchasers who use proceeds from an account for which U.S.
Bank or one of its affiliates acts in a fiduciary, advisory, custodial
or similar capacity, to purchase Class A Shares of a Fund, (6) brokers,
dealers and agents who have a sales agreement with the Distributor, and
their employees (and the immediate family members of such individuals),
(7) investment advisers or financial planners that have entered into an
agreement with the Distributor and that place trades for their own
accounts or the accounts of eligible clients and that charge a fee for
their services, and clients of such investment advisers or financial
planners who place trades for their own accounts if such accounts are
linked to the master account of the investment adviser or financial
planner on the books and records of a broker or agent that has entered
into an agreement with the Distributor, and (8) orders placed on behalf
of other investment companies distributed by BISYS, The BISYS Group,
Inc., or their affiliated companies. In addition, the Distributor may
waive sales charges for the purchase of a Fund's Class A Shares

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<PAGE>

with the proceeds from the recent redemption of shares of a non-money
market mutual fund (except one of the other funds of the Trust) sold
with a sales charge. The purchase must be made within 60 days of the
redemption, and the Distributor must be notified in writing by the
investor, or by his or her financial institution, at the time the
purchase is made. A copy of the investor's account statement showing
such redemption must accompany such notice. To receive a sales charge
waiver in conjunction with any of the above categories, Shareholders
must, at the time of purchase, give the Transfer Agent or the
Distributor sufficient information to permit confirmation of
qualification.

Senior Citizens Discount

The Distributor may offer a 10% reduction of sales charges for the
purchase of Class A Shares of a Fund by or on behalf of a purchaser who
has attained the age of 59 1/2 years. Any such reduction also will
apply to purchases made through the Auto Invest Plan. To receive this
sales charge reduction, Shareholders must, at the time of purchase, give
the Transfer Agent or the Distributor sufficient information to permit
confirmation of qualification. BISYS will receive a sale charge on such
sales and may reallow it as dealer discounts and brokerage commissions
as follows:

Sales Charge as:
----------------
Size of Transaction % of Offering % of Net Dealer
at Offering Price Price Amount Invested Reallowance
- ------------------- ------------- --------------- -----------

Concurrent Purchases

For purposes of qualifying for a lower sales charge, investors have the
privilege of combining "concurrent purchases" of Class A Shares of the
Funds, the Equity Funds and the Income Funds. For example, if a
Shareholder concurrently purchases Class A Shares in one of the funds of
the Trust sold with a sales charge at the total public offering price of
$25,000 and Class A Shares in another fund sold with a sales charge at
the total public offering price of $75,000, the sales charge would be
that applicable to a $100,000 purchase as shown in the appropriate table
above. The investor's "concurrent purchases" described above shall
include the combined purchases of the investor, the investor's spouse
and children under the age of 21 and the purchaser's retirement plan
accounts. To receive the applicable public offering price pursuant to
this privilege, Shareholders must, at the time of purchase, give the
Transfer Agent or the Distributor sufficient information to permit
confirmation of qualification. This privilege, however, may be modified
or eliminated at any time or from time to time by the Trust without
notice.

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<PAGE>

Letters of Intent

An investor may obtain a reduced sales charge by means of a written
Letter of Intent which expresses the intention of such investor to
purchase Class A Shares of a Fund, an Equity Fund or an Income Fund at a
designated total public offering price within a designated 13-month
period. Each purchase of Class A Shares under a Letter of Intent will be
made at the net asset value plus the sales charge applicable at the time
of such purchase to a single transaction of the total dollar amount
indicated in the Letter of Intent (the "Applicable Sales Charge"). A
Letter of Intent may include purchases of Class A Shares made not more
than 90 days prior to the date such investor signs a Letter of Intent;
however, the 13-month period during which the Letter of Intent is in
effect will begin on the date of the earliest purchase to be included.
An investor will receive as a credit against his/her purchase(s) of
Shares during this ninety day period at the end of the 13-month period,
the difference, if any, between the sales load paid on previous
purchases qualifying under the Letter of Intent and the Applicable Sales
Charge.

A Letter of Intent is not a binding obligation upon the investor to
purchase the full amount indicated. The minimum initial investment
under a Letter of Intent is 5% of such amount. Class A Shares purchased
with the first 5% of such amount will be held in escrow (while remaining
registered in the name of the investor) to secure payment of the higher
sales charge applicable to the Class A Shares actually purchased if the
full amount indicated is not purchased, and such escrowed Class A Shares
will be involuntarily redeemed to pay the additional sales charge, if
necessary. Dividends on escrowed Class A Shares, whether paid in cash
or reinvested in additional Class A Shares, are not subject to escrow.
The escrowed Class A Shares will not be available for disposal by the
investor until all purchases pursuant to the Letter of Intent have been
made or the higher sales charge has been paid. When the full amount
indicated has been purchased, the escrow will be released. To the
extent that an investor purchases more than the dollar amount indicated
in the Letter of Intent and qualifies for a further reduced sales
charge, the sales charge will be adjusted for the entire amount
purchased at the end of the 13-month period. The difference in sales
charge will be used to purchase additional Class A Shares of such Fund
at the then current public offering price subject to the rate of sales
charge applicable to the actual amount of the aggregate purchases. For
further information about Letters of Intent, interested investors should
contact the Trust at 1-800-743-8637. This program, however, may be
modified or eliminated at any time or from time to time by the Trust
without notice.

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<PAGE>

Rights of Accumulation

Pursuant to the right of accumulation, investors are permitted to
purchase Class A Shares of the Funds at the public offering price
applicable to the total of (a) the total public offering price of the
Class A Shares of the Funds then being purchased plus (b) an amount
equal to the then current net asset value of the "purchaser's combined
holdings" of the Class A Shares of all of the funds of the Trust sold
with a sales charge. Class A Shares sold to purchasers for whom U.S.
Bank or one of its affiliates acts in a fiduciary, advisory, custodial
(other than retirement accounts), agency, or similar capacity are not
presently subject to a sales charge. The "purchaser's combined
holdings" described above shall include the combined holdings of the
purchaser, the purchaser's spouse and children under the age of 21 and
the purchaser's retirement plan accounts. To receive the applicable
public offering price pursuant to the right of accumulation,
Shareholders must, at the time of purchase, give the Transfer Agent or
the Distributor sufficient information to permit confirmation of
qualification. This right of accumulation, however, may be modified or
eliminated at any time or from time to time by the Trust without notice.

Contingent Deferred Sales Charge ("CDSC") -- Class C Shares

Class C Shares of the Funds which are redeemed less than one year after
purchase will be subject to a CDSC equal to 1.00% of an amount equal to
the lesser of the net asset value at the time of purchase of the Class C
Shares being redeemed or the net asset value of such Shares at the time
of redemption. Accordingly, a CDSC will not be imposed on amounts
representing increases in net asset value above the net asset value at
the time of purchase. In addition, a CDSC will not be assessed on Class
C Shares purchased through reinvestment of dividends or capital gains
distributions, or that are purchased by "Institutional Investors" such
as corporations, pension plans, foundations, charitable institutions,
insurance companies, banks and other banking institutions, and non-bank
fiduciaries.

Solely for purposes of determining the amount of time which has elapsed
from the time of purchase of any Class C Shares, all purchases during a
month will be aggregated and deemed to have been made on the last day of
the month. In determining whether a CDSC is applicable to a redemption,
the calculation will be made in the manner that results in the lowest
possible charge being assessed. In this regard, it will be assumed that
the redemption is first of Shares held for more than one year or Shares
acquired pursuant to reinvestment of dividends or distributions.

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<PAGE>

redemption of 50 Class C Shares (producing proceeds of $600), five of
such Shares will not be subject to the charge because of dividend
reinvestment. With respect to the remaining 45 Class C Shares being
redeemed, the charge will be applied only to the original cost of $10
per Share and not to the increase in net asset value of $2 per Share.

The CDSC is waived on redemptions of Class C Shares (i) following the
death or disability (as defined in the Internal Revenue Code of 1986, as
amended (the "Code")) of a Shareholder, (ii) to the extent that the
redemption represents a minimum required distribution from an IRA or a
Custodial Account under Code Section 403(b)(7) to a Shareholder who has
reached age 70 1/2, and (iii) to the extent the redemption represents
the minimum distribution from retirement plans under Code Section 401(a)
where such redemptions are necessary to make distributions to plan
participants.

Factors to Consider When Selecting Class A Shares or Class C Shares of
the Funds

Before purchasing Class A Shares or Class C Shares of a Fund, investors
should consider whether, during the anticipated life of their investment
in the Fund, the accumulated Rule 12b-1 fees and potential CDSC on Class
C Shares would be less than the initial sales charge and accumulated
Rule 12b-1 fees on Class A Shares purchased at the same time, and to
what extent such differential would be offset by the higher yield of
Class A Shares. In this regard, to the extent that the sales charge
for the Class A Shares is waived or reduced by one of the methods
described above, investments in Class A Shares become more desirable.
The Trust will refuse all purchase orders for individual accounts for
Class C Shares of over $500,000.

Although Class A Shares are subject to a Rule 12b-1 fees, they are not
subject to the higher Rule 12b-1 fees applicable to Class C Shares. For
this reason, Class A Shares can be expected to pay correspondingly
higher dividends per Share. However, because initial sales charges are
deducted at the time of purchase, purchasers of Class A Shares that do
not qualify for waivers of or reductions in the initial sales charge
would have less of their purchase price initially invested in a Fund
than purchasers of Class C Shares. See "MANAGEMENT OF THE TRUST --
Distributor" in the Statement of Additional Information.

Exchange Privilege

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<PAGE>

the exchange is made in states where it is legally authorized.
Exchanges for Shares of one of the Trust's other funds with a higher
sales charge may be made upon payment of the sales charge differential.
Holders of a Fund's Class A or Class C Shares may not exchange their
Shares for Shares of any other class. An exchange of Class C Shares
will not affect the holding period of the Shares for purposes of the
CDSC.

If Class A Shares of a Money Fund were acquired by a previous exchange
from Class A Shares of a fund with respect to which a sales charge had
been paid, then such Class A Shares of the Money Fund may be exchanged
for Class A Shares of a Fund without payment of any fees or sales
charge. Under such circumstances, in order to receive a reduced sales
charge, the Shareholder must notify the Distributor that a sales charge
was originally paid and provide the Distributor with sufficient
information to permit confirmation of qualification. The foregoing
exchange privilege may be exercised only once during a calendar year and
upon written request by the Shareholder and may be terminated or
modified by the Trust at any time, or from time to time.

An exchange is considered a sale of Shares and may result in a capital
gain or loss for federal income tax purposes.

A Shareholder wishing to exchange his or her Shares may do so by
contacting the Trust at 1-800-743-8637, by contacting their
broker-dealer or by providing written instructions to the Distributor.
Any Shareholder who wishes to make an exchange should obtain and review
the current prospectus of the fund of the Trust in which the Shareholder
wishes to invest before making the exchange. For a discussion of risks
associated with unauthorized telephone exchanges, see "REDEEMING SHARES
- -- By Telephone" below.

Conversion Feature

Eight years after purchase, Class C Shares will convert automatically to
Class A Shares. The purpose of the conversion is to relieve a holder of
Class C Shares of the higher ongoing expenses charged to those Shares,
after enough time has passed to allow the Distributor to recover
approximately the amount it would have received if a front-end sales
charge had been charged. The conversion from Class C Shares to Class A
Shares takes place at net asset value, as a result of which an investor
receives dollar-for-dollar the same value of Class A Shares as he or she
had of Class C Shares. The conversion occurs eight years after the
beginning of the calendar month in which the Shares are purchased. As a
result of the conversion, the converted Shares are relieved of the Rule
12b-1 fees borne by Class C Shares, although they are subject to the
Rule 12b-1 fees borne by Class A Shares.

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<PAGE>

QUALIVEST INDIVIDUAL RETIREMENT ACCOUNTS ("IRA")

A Qualivest IRA enables individuals, even if they participate in an
employer-sponsored retirement plan, to establish their own retirement
program. Qualivest IRA contributions may be tax-deductible and earnings
are tax-deferred. Under the Tax Reform Act of 1986, the tax
deductibility of IRA contributions is restricted or eliminated for
individuals who participate in certain employer pension plans and whose
annual income exceeds certain limits. Existing IRAs and future
contributions up to the IRA maximums, whether deductible or not, still
earn income on a tax-deferred basis.

Simplified Employee Pension Plan ("SEP/IRA")

A Qualivest SEP/IRA may be established on a group basis by an employer
who wishes to sponsor a tax-sheltered retirement program by making
contributions into IRAs on behalf of all eligible employees.

Salary Reduction Simplified Employee Pension Plan ("SAR-SEP/IRA")

A Qualivest SAR-SEP/IRA offers employers with 25 or fewer eligible
employees the ability to establish a SEP/IRA that permits salary
reduction contributions. All Qualivest IRA distribution requests must
be made in writing to BISYS Fund Services. Any additional deposits to a
Qualivest IRA must distinguish the type and year of the contribution.

For more information on any of the Qualivest IRAs or other retirement
plan options available (401(k) Defined Contribution Plans, 403(b)(7)
Defined Compensation Plans, etc.), call the Trust at 1-800-743-8637.
Shareholders are advised to consult a tax adviser on Qualivest IRA
contribution and withdrawal requirements and restrictions.

REDEEMING SHARES

Shareholders may redeem their Class A Shares without charge and their
Class C Shares, subject to the CDSC described above if redeemed less
than one year after purchase, on any day that net asset value is
calculated (see "VALUATION OF SHARES"). Redemptions will be effected at
the net asset value per Share next determined after receipt by the
Distributor of a redemption request. Redemptions may be requested by
mail or by telephone.

By Mail

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<PAGE>

record, and (2) the redemption check is mailed to the Shareholder(s) at
the address of record. The Shareholder may also have the proceeds mailed
to a commercial bank account previously designated on the Account
Application Form. There is no charge for having redemption proceeds
mailed to a designated bank account. To change the address to which a
redemption check is to be mailed, a written request therefor must be
received by the Transfer Agent. In connection with such request, the
Transfer Agent will require a signature guarantee by an eligible
guarantor institution.

For purposes of this policy, the term "eligible guarantor institution"
shall include banks, brokers, dealers, credit unions, securities
exchanges and associations, clearing agencies and savings associations
as those terms are defined in the 1934 Act. The Transfer Agent reserves
the right to reject any signature guarantee if (1) it has reason to
believe that the signature is not genuine, (2) it has reason to believe
that the transaction would otherwise be improper, or (3) the guarantor
institution is a broker or dealer that is neither a member of a clearing
corporation nor maintains net capital of at least $100,000.

By Telephone

Shares may be redeemed by telephone if the Account Application Form
reflects that the Shareholder has elected that privilege. If the
telephone feature was not originally selected, the Shareholder must
provide written instructions to the Trust to add it. The Shareholder
may have the proceeds mailed to his or her address or mailed or wired to
a commercial bank account previously designated on the Account
Application Form. Under most circumstances, payments will be
transmitted on the next Business Day. Wire redemption requests may be
made by the Shareholder by telephone to the Trust at 1-800-743-8637.
While the Transfer Agent currently does not charge a wire redemption
fee, the Transfer Agent reserves the right to impose such a fee in the
future.

The Trust's Account Application Form provides that none of BISYS, the
Transfer Agent, Qualivest, the Trust or any of their affiliates or
agents will be liable for any loss, expense or cost when acting upon any
oral, wired or electronically transmitted instructions or inquiries
believed by them to be genuine. While precautions will be taken, as
more fully described below, Shareholders bear the risk of any loss as
the result of unauthorized telephone redemptions or exchanges believed
by the Transfer Agent to be genuine. The Trust will employ reasonable
procedures to confirm that instructions communicated by telephone are
genuine. These procedures include recording all phone conversions,
sending confirmations to Shareholders within 72 hours of the telephone
transaction, verifying the account name and a Shareholder's account
number or tax identification number and sending redemption proceeds only
to the address of record or to a previously authorized bank account. If
a Shareholder is unable to contact the Funds by telephone, a

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<PAGE>

Shareholder may also mail the redemption request to the Distributor at
the address above.

Auto Withdrawal Plan

The Auto Withdrawal Plan enables Shareholders of the Funds to make
regular monthly, bi-monthly, or quarterly redemptions of Class A or
Class C Shares. With Shareholder authorization, the Transfer Agent
will automatically redeem Class A or Class C Shares at the net asset
value on the fifth and/or twentieth day of the month or quarter (or the
next Business Day thereafter) and have the amount specified transferred
according to the written instructions of the Shareholder. Shareholders
participating in this Plan must maintain a minimum account balance of
$500. The required minimum withdrawal is $100, monthly or quarterly.

The Auto Withdrawal Plan may be modified or terminated without notice.
In addition, the Trust may suspend a Shareholder's withdrawal plan
without notice if the account contains insufficient funds to effect a
withdrawal or in the event that the account balance is less than the
minimum $500 amount.

To participate in the Auto Withdrawal Plan, Shareholders should call
1-800-743-8637 for more information. Purchases of additional Class A or
Class C Shares concurrently with withdrawals may be disadvantageous to
certain Shareholders because of tax liabilities and sales charges. For
a Shareholder to change the Auto Withdrawal Plan instructions, the
request must be made in writing to the Distributor and may take up to 15
days to implement.

Other Information Regarding Redemption of Shares

All redemption orders are effected at the net asset value per Share next
determined after the Shares are properly tendered for redemption, as
described above. The proceeds paid upon redemption of Shares in the
Funds, less any applicable CDSC, may be more or less than the amount
invested. Payment to Shareholders for Shares redeemed will be made
within seven days after receipt of the request for redemption, or within
such shorter period as required by law. To the greatest extent
possible, requests from Shareholders of a Fund for next Business Day
payments upon redemption of Shares will be honored if received in good
form by the Distributor before the Valuation Time on a Business Day or,
if received after the Valuation Time, within two Business Days, unless
it would be disadvantageous to that Fund or its Shareholders to sell or
liquidate portfolio securities in an amount sufficient to satisfy
requests for payments in that manner.

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<PAGE>

than $500. Accordingly, an investor purchasing Shares of a Fund in only
the minimum investment amount may be subject to such involuntary
redemption if the investor thereafter redeems any Shares. Before the
Trust exercises its right to redeem such Shares and to send the proceeds
to the Shareholder, the Shareholder will be given notice that the value
of the Shares in the Shareholder's account is less than the minimum
amount and will be allowed 60 days to make an additional investment in
an amount which will increase the value of the account to at least $500.

See the Statement of Additional Information ("ADDITIONAL PURCHASE AND
REDEMPTION INFORMATION") for examples of when the right of redemption
may be suspended.

MANAGEMENT OF THE FUNDS

Trustees

Overall responsibility for management of the Trust rests with its
Trustees, who are elected by the Shareholders of all of the Trust's
funds. The Trust will be managed by the Trustees in accordance with the
laws of the Commonwealth of Massachusetts governing business trusts.
There are currently six Trustees, three of whom are not "interested
persons" of the Trust within the meaning of that term under the 1940
Act. The Trustees, in turn, elect the officers of the Trust to
supervise its day-to-day operations. The Trustees of the Trust are:
George R. Landreth, David F. Jones, John W. Judy, Raymond H. Lung, Mary
Anne Houlahan and David B. Frohnmayer.

The Trustees and officers of the Trust serve in such positions for the
Funds and for the Underlying Funds. If the interests of the Funds and
the Underlying Fund were to become divergent, it is possible that a
conflict of interest could arise and affect how the Trustees and
officers fulfill their fiduciary duties to the Funds and the Underlying
Funds. While the Trustees believe they have structured the Funds to
avoid such conflicts, if a situation arises where appropriate action for
a Fund could adversely affect an Underlying Fund, or vice versa, the
Trustees and officers will carefully analyze the situation and take all
steps they believe reasonable to minimize and, where possible, eliminate
the potential conflict. To this end, restrictions have been adopted by
the Funds to minimize this possibility, and close and continuous
monitoring will be exercised to avoid, insofar as possible, these
concerns.

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<PAGE>

Investment Adviser

Qualivest Capital Management, Inc., 111 S.W. Fifth Avenue, Portland,
Oregon 97204, is the investment adviser of the Trust. Qualivest, a
registered investment adviser, is an affiliate of U.S. Bank, which is a
wholly owned subsidiary of U.S. Bancorp. U.S. Bancorp is a
super-regional financial services holding company organized under the
laws of Oregon in 1968. U.S. Bank, headquartered in Portland, is a
national banking association chartered in 1891. It offers a wide
variety of full-service and commercial banking operations in over 200
locations in Oregon. Other services of U.S. Bancorp and its
subsidiaries include mortgage banking, lease financing, consumer
financing, commercial finance, international banking, investment
advisory, insurance agency and credit life insurance services, brokerage
and venture capital. As of January 1, 1996, Qualivest had under
management nearly $8.0 billion in assets. It also is investment adviser
to Tax-Free Trust of Oregon, a tax-free municipal bond fund, whose
assets were approximately $310 million at that date.

Qualivest invests each Fund's assets according to its investment
objective and policies set forth above and pursuant to guidelines
established by the Board of Trustees for each Fund. Such allocation
decisions are made by the Qualivest Investment Strategy Committee (the
"Committee"). No individual or individuals are primarily responsible
for the allocation decisions of the Committee. For the services
provided and expenses assumed pursuant to its Investment Advisory
Agreement with the Trust, Qualivest receives a fee from each of the
Funds, computed daily and paid monthly, at an annual rate of 0.20%
of each Fund's average daily net assets. However, Qualivest has
agreed to temporarily waive its investment advisory fee and reimburse
each Fund of its operating expenses in the current fiscal year to the
extent that such expenses, exclusive of Rule 12b-1 fees, exceed 0.25%
of the Fund's average daily net assets. Each Fund, as a Shareholder in
an Underlying Fund, also will indirectly bear its proportionate share
of any investment advisory fees and other expenses paid by the Underlying
Fund. The ratios of operating expenses to average daily net assets of
the Class Y Shares of the Underlying Funds for the period ended July 31, 1995
were as follows: Large Companies Fund - 0.53%; Small Companies Fund - 0.60%;
International Fund - 1.18%; Optimized Fund - 0.68%; Intermediate Bond
Fund - 0.41%; Bond Fund - 0.70%; U.S. Treasury Fund - 0.40%; and Money
Market Fund - 0.38%.

Subject to the general supervision of the Trust's Board of Trustees and
in accordance with each of the Funds' investment objective, policies
and restrictions, Qualivest has agreed in its Investment Advisory
Agreement with the Trust to provide or arrange for the provision of a
continuous investment program for each Underlying Fund, including
investment research and management with respect to the Underlying Funds'
portfolio securities, investments and cash.

John R. Dozier, who joined Qualivest in 1976, is the Equity Manager
primarily responsible for managing the Large Companies Fund. Mr. Dozier
has twenty-five years of investment management experience and received a
Bachelor of Arts degree in Economics from Claremont Men's College.

Dale E. Benson, an Equity Manager at Qualivest, has primary
responsibility for management of the Small Companies Fund. Mr.

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<PAGE>

Benson has twenty-three years of investment management experience and
has been employed by Qualivest since 1973. He received a Bachelor of
Arts degree from Pacific Lutheran University and a Doctorate in History
from the University of Maine. Mr. Benson is also a Chartered Financial
Analyst.

Timothy Leach, President and Chief Investment Officer of Qualivest,
manages the International Fund and Optimized Fund. He has thirteen
years of investment management experience, both at Qualivest and at
other investment management organizations, and is responsible for the
management of Qualivest. Mr. Leach has a Bachelor of Science degree in
Business Management and Agricultural Science and a Master of Business
Administration degree from the University of California, Berkeley.

Portfolio management of the Intermediate Bond Fund and the Bond Fund is
the responsibility of Curry A. Garvin, a Fixed-Income Manager who has
been employed by Qualivest since 1985. Mr. Garvin, who is a Chartered
Financial Analyst, received a Bachelor of Science degree in Finance from
the University of Oregon.

For the services provided and expenses assumed pursuant to its
Investment Advisory Agreement with the Trust, Qualivest receives a fee
from each of the Underlying Funds, computed daily and paid monthly, at
the following annual rates of each Underlying Fund's average daily net
assets: Large Companies Fund - 0.75%; Small Companies Fund - 0.80%;
International Fund - 0.60%; Optimized Fund - 0.50%; Intermediate Bond
Fund - 0.60%; Bond Fund - 0.60%; U.S. Treasury Fund - 0.35%; and Money
Market Fund - 0.35%.

While the fees for the Large Companies and Small Companies Funds are
higher than the advisory fees paid by most investment companies, the
Board of Trustees believes them to be comparable to advisory fees paid
by many funds having similar objectives and policies. Qualivest may
periodically voluntarily reduce all or a portion of its advisory fee
with respect to an Underlying Fund to increase the net income of that
Underlying Fund available for distribution as dividends. The voluntary
fee reduction will cause the return of that Underlying Fund to be higher
than it would otherwise be in the absence of such reduction.

Administrator and Distributor

BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035, a
division of BISYS Group, Inc., is the administrator for each fund of the
Trust, and also acts as the Trust's principal underwriter and
distributor.

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<PAGE>

and paid periodically, at an annual rate of ____% of the Fund's average
daily net assets, or such other fee as may be agreed upon from time to
time by the Trust and the Administrator. The Administrator may
periodically voluntarily reduce all or a portion of its administrative
fee with respect to a Fund to increase the net income of that Fund
available for distribution as dividends. The voluntary fee reduction
will cause the return of that Fund to be higher than it would otherwise
be in the absence of such reduction.

The Distributor acts as agent for the Funds in the distribution of their
Shares and, in such capacity, solicits orders for the sale of Shares,
advertises, and pays the cost of advertising, office space and its
personnel involved in such activities. Under its Distribution Agreement
with the Trust, the Distributor may retain some or all of any sales
charge imposed upon the Shares. It may also receive compensation under
the Distribution and Shareholder Service Plans regarding the Class A
Shares and Class C Shares described below.

Other Service Providers

BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-
3035, serves as the Trust's transfer agent and dividend disbursing agent
pursuant to a Transfer Agency Agreement with the Trust and receives a
fee for such services. BISYS Fund Services Ohio, Inc. also provides
certain accounting services for each of the Funds and receives a fee for
such services. Deloitte & Touche LLP serves as independent auditors for
the Trust. United States National Bank of Oregon is the custodian of
the Funds. See "MANAGEMENT OF THE TRUST" in the Statement of Additional
Information for further information.

While BISYS Fund Services Ohio, Inc. is a distinct legal entity from
BISYS (the Trust's administrator and distributor), BISYS Fund Services
Ohio, Inc. is considered to be an affiliated person of BISYS under the
1940 Act due to, among other things, the fact that BISYS Fund Services
Ohio, Inc. is owned by substantially the same persons that directly or
indirectly own BISYS.

Expenses

Qualivest and the Administrator each bear all expenses in connection
with the performance of its services other than the cost of securities
purchased for the Trust. Each Fund will bear the following expenses
relating to its operation: organizational expenses, taxes, interest,
fees of the Trustees of the Trust, Securities and Exchange Commission
fees, state securities qualification fees, costs of preparing and
printing prospectuses for regulatory purposes and for distribution to
current Shareholders, outside auditing and legal expenses, advisory and
administration fees, fees and out-of-pocket expenses of the Custodian,
Transfer Agent and fund accountant, certain insurance

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<PAGE>

premiums, costs of maintenance of the Trust's existence, costs of
Shareholders' reports and meetings, and any extraordinary expenses
incurred in each Fund's operation.

As a general matter, expenses are allocated to the Class A, Class C and
Class Y Shares of the Funds on the basis of the relative net asset value
of each class. Class A Shares and Class C Shares may bear certain
additional retail transfer agency expenses. Class A Shares and Class C
Shares also bear certain additional Shareholder service and
distribution costs incurred pursuant to the Distribution and Shareholder
Service Plans described below.

The Trustees reserve the right, subject to the receipt of relevant
regulatory approvals or rulings, if needed, to allocate certain other
expenses to the Shareholders of a particular class, including Class A
and Class C Shares, on a basis other than relative net asset value, as
they deem appropriate ("Class Expenses"). In such event, Class Expenses
would be limited to: transfer agency fees identified by the Transfer
Agent as attributable to a specific class; printing and postage expenses
related to preparing and distributing materials such as Shareholder
reports, prospectuses and proxies to current Shareholders; Blue Sky
registration fees incurred by a class of Shares; Securities and Exchange
Commission registration fees incurred by a class of Shares; expenses
related to administrative personnel and services as required to support
the Shareholders of a specific class; litigation or other legal expenses
relating solely to one class of Shares; and Trustees' fees incurred as a
result of issues relating solely to one class of Shares.

Banking Laws

Federal banking laws and regulations presently prohibit a national bank
or any affiliate thereof from sponsoring, organizing or controlling a
registered open-end investment company continuously engaged in the
issuance of its shares, and generally from underwriting, selling or
distributing securities, such as Shares of the Funds.

Qualivest is a subsidiary of U.S. Bank, and it and U.S. Bank are
affiliates of a bank holding company. They are therefore subject to
applicable federal banking laws and regulations. Qualivest has been
advised by its counsel that it may perform the advisory services for the
Funds required by the Investment Advisory Agreement and, provided that
they do not engage in underwriting, selling or distribution of the
Funds' Shares, Qualivest's national bank affiliates may perform
shareholder servicing activities and may receive compensation without
violating federal banking laws and regulations.

In the event that, due to future events, Qualivest is prohibited from
acting as the investment adviser of the Funds and the Underlying Funds,
it is probable that the Board of Trustees would

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<PAGE>

either recommend to Shareholders the selection of another qualified
adviser or, if that course of action appeared impractical, that the
Funds and Underlying Funds be liquidated.

DISTRIBUTION PLANS

Pursuant to Rule 12b-1 under the 1940 Act, the Trust has adopted
Distribution and Shareholder Service Plans with respect to the Class A
Shares of each Fund (the "Class A Plans"), as well as Distribution and
Shareholder Service Plans with respect to Class C Shares of each Fund
(the "Class C Plans" and, with the Class A Plans, the "Plans").

Pursuant to the Class A Plans, each Fund is authorized to pay or
reimburse BISYS, as Distributor of the Class A Shares of the Fund, for
certain expenses that are incurred in connection with Shareholder and
distribution services. Payments under the Class A Plans will be
calculated daily and paid monthly at an annual rate not to exceed 0.25%
of the average daily net assets of Class A Shares of each Fund. As
authorized by the Class A Plans, BISYS has entered into a Rule 12b-1
Agreement with U.S. Bancorp Securities, Inc. ("USBS"), an affiliate of
Qualivest, pursuant to which USBS has agreed to provide certain
Shareholder and distribution services in connection with Class A Shares
of the Funds purchased and held by USBS for the accounts of its
customers and Class A Shares of the Funds purchased and held by
customers of USBS directly. BISYS will be compensated by the Funds in
an amount equal to its payments to USBS under the Rule 12b-1 Agreement.
Such fee may exceed the actual costs incurred by USBS in providing such
services.

Pursuant to the Class C Plans, a Fund is authorized to pay or reimburse
BISYS, as Distributor of Class C Shares, (a) a distribution fee in an
amount not to exceed on an annual basis 0.75% of the average daily net
assets of Class C Shares of a Fund, and (b) a service fee in an amount
not to exceed on an annual basis 0.25% of the average daily net assets
of the Class C Shares of a Fund. Payments under the Class C Plans will
be calculated daily and paid monthly at a rate not to exceed the limits
described above, which rates are set from time to time by the Board of
Trustees. Actual distribution expenses for Class C Shares at any given
time may exceed the Rule 12b-1 fees and payments received pursuant to
CDSCs. These unrecovered amounts plus interest thereon will be carried
forward and paid from future Rule 12b-1 fees and payments received from
CDSCs. If the Class C Plans were terminated or not continued, the Trust
would not be contractually obligated to pay for any expenses not
previously reimbursed by the Trust or recovered through CDSCs.

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<PAGE>

BISYS and the Participating Organization. Pursuant to the Plans, the
Distributor may enter into Rule 12b-1 Agreements with Participating
Organizations for providing Shareholder and distribution services to
their customers who are the record or beneficial owners of Shares. Such
Participating Organizations will be compensated at an annual rate of up
to 0.25% of the average daily net assets of the Class A Shares and Class
C Shares held of record or beneficially by such customers. Under the
Plans, a Participating Organization may include BISYS, its
subsidiaries, and its affiliates.

Payments to the Distributor pursuant to the Plans will be used (i) to
compensate Participating Organizations for providing distribution
assistance relating to Shares, (ii) for promotional activities intended
to result in the sale of Shares, such as to pay for the preparation,
printing and distribution of prospectuses to other than current
Shareholders, and (iii) to compensate Participating Organizations for
providing Shareholder services with respect to their customers who are,
from time to time, beneficial and record holders of Shares of the Funds.

Fees paid pursuant to the Class A Plans and Class C Plans are accrued
daily and paid monthly, and are charged as expenses of Class A Shares
and Class C Shares, respectively, of a Fund as accrued.

General Information

The Plans may be terminated by a vote of a majority of the Trustees who
are not "interested persons" (as defined in the 1940 Act) of the Trust
and who have no direct or indirect financial interest in the operation
of the Plans or in any agreements related to a Plan ("Independent
Trustees"), or by a vote of a majority of the holders of the outstanding
voting securities of the class of Shares subject thereto. Any change in
the Plans that would increase materially the distribution expenses paid
by a Fund requires Shareholder approval; otherwise, the Plans may be
amended by the Trustees, including a majority of the Independent
Trustees, by a vote cast in person at a meeting called for the purpose
of voting upon the amendment. As long as either Plan is in effect, the
selection or nomination of the Independent Trustees is committed to the
discretion of the Independent Trustees.

DIVIDENDS AND TAXES

Dividends

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<PAGE>

additional full and fractional Shares at net asset value as of the date
of declaration, unless the Shareholder elects to receive dividends or
distributions in cash or elects to participate in the Qualivest Directed
Dividend Option. Such election, or any revocation thereof, must be made
in writing to the Transfer Agent at 3435 Stelzer Road, Columbus, Ohio
43219-3035, and will become effective with respect to dividends and
distributions having record dates after its receipt by the Transfer
Agent.

Directed Dividend Option

A Shareholder may elect to have all income dividends and capital gains
distributions paid by check, reinvested in the Fund or reinvested in the
same class of any of the Trust's other funds, provided the other fund is
maintained at the minimum required balance. The Directed Dividend
Option may be modified or terminated by the Trust at any time after
notice to participating Shareholders. Participation in the Directed
Dividend Option may be terminated or changed by the Shareholder at any
time by writing the Distributor. The Directed Dividend Option is not
available to participants in any of the Qualivest IRAs.

Federal Taxes

Each Fund intends to qualify annually and elect to be treated as a
regulated investment company under the Code, so that it generally will
not be subject to federal income tax on its taxable income and gains
that are distributed to Shareholders. In order to avoid a 4% federal
excise tax, each Fund intends to distribute each calendar year
substantially all of its taxable income and gains.

Distributions from a Fund's investment company taxable income (which
includes, among other items, dividends, taxable interest and the excess,
if any, of net short-term capital gains over net long-term capital
losses) are taxable to Shareholders as ordinary income. Dividends paid
by the Funds to corporate Shareholders, to the extent such dividends are
attributable to dividends received from U.S. corporations, may qualify
for the dividends-received deduction. However, the alternative minimum
tax applicable to corporations may reduce the value of the dividends-
received deduction. Distributions of net capital gains (the excess of
net long-term capital gains over net short-term capital losses), if any,
designated by a Fund as capital gain dividends, are taxable as long-term
capital gains, regardless of how long the Shareholder has held the
Fund's Shares and are not eligible for the dividends-received deduction.

Certain dividends declared by a Fund in October, November or December
and paid during the following January will be treated as having been
received by Shareholders on December 31 in the year the distributions
were declared. Reinvested distributions will be taxable as if they had
been received in cash.

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<PAGE>

Each Fund may be required to withhold federal income tax at the rate of
31% of all taxable distributions paid to Shareholders who fail to
provide a Fund with their correct taxpayer identification number or to
make required certifications or who have been notified by the Internal
Revenue Service ("IRS") that they are subject to backup withholding.
Corporate Shareholders and certain other Shareholders specified in the
Code are exempt from backup withholding. Backup withholding is not an
additional tax and any amounts withheld may be credited against the
Shareholder's federal income tax liability.

Shareholders of the Funds should be aware that under the laws of some
state and local taxing authorities, distributions from a Fund that are
attributable to interest earned on certain U.S. Government securities
may not be subject to state or local taxes. Shareholders also should be
aware that under the laws of some state and local taxing authorities,
distributions from the Funds that are attributable to interest on state
and municipal securities issued within the Shareholder's own state may
not be subject to state or local taxes.

Prior to purchasing Shares of the Funds, the impact of dividends or
capital gains distributions which are expected to be declared or have
been declared, but have not been paid, should be carefully considered.
Any such dividends or capital gains distributions paid shortly after a
purchase of Shares prior to the record date will have the effect of
reducing the per Share net asset value of the Shares by the amount of
the dividends or distributions. All or a portion of such dividends or
distributions, although in effect a return of capital, is subject to
tax.

Shareholders will be furnished annually with information relating to the
nature and amounts of distributions made by a Fund.

The proceeding discussion is only a summary of some of the federal tax
considerations generally affecting the Funds and their Shareholders and
does not address every possible situation. Distributions (including
exempt-interest dividends) may be subject to state, local and foreign
taxes, and non-U.S. Shareholders may be subject to U.S. tax rules that
differ significantly from those summarized herein. Prospective
Shareholders should consult their tax advisers with respect to the
effect of investing in a Fund. For additional information relating to
taxes, see "ADDITIONAL INFORMATION--Additional Tax Information" in the
Statement of Additional Information.

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<PAGE>

GENERAL INFORMATION

Organization of the Trust

The Trust was organized as a Massachusetts business trust in 1994 and
consists of seventeen funds. The Shares of each of the Funds are
offered in three separate classes: Class A Shares, Class C Shares and
Class Y Shares. Shares of the Equity Funds and the Income Funds also
are offered in Class A Shares, Class C Shares and Class Y Shares, while
Shares of the Money Funds are offered in Class A Shares, Class Q Shares
and Class Y Shares. Each Share represents an equal proportionate
interest in a fund with other Shares of the same fund, and is entitled
to such dividends and distributions out of the income earned on the
assets belonging to that fund as are declared at the discretion of the
Trustees. Shares are without par value. Shareholders are entitled to
one vote for each dollar of value invested and a proportionate
fractional vote for any fraction of a dollar invested. Shareholders
will vote in the aggregate and not by fund except as otherwise expressly
required by law.

An annual or special meeting of Shareholders to conduct necessary
business is not required by the Trust's Declaration of Trust, the 1940
Act or other authority except, under certain circumstances, to elect
Trustees, amend the Declaration of Trust, approve an investment advisory
agreement and to satisfy certain other requirements. To the extent that
such a meeting is not required, the Trust may elect not to have an
annual or special meeting.

The Trust will call a special meeting of Shareholders for purposes of
considering the removal of one or more Trustees upon written request
therefor from Shareholders holding not less than 10% of the outstanding
votes of the Trust. At such a meeting, a quorum of Shareholders
(constituting a majority of votes attributable to all outstanding Shares
of the Trust), by majority vote, has the power to remove one or more
Trustees.

Multiple Classes of Shares

In addition to Class A and Class C Shares, the Trust also offers Class Y
Shares of the Funds. Class Y Shares are sold through procedures
established by the Distributor only to certain institutional investors
and bank trust departments purchasing Shares on behalf of fiduciary,
advisory, agency, custody or other similar accounts maintained by, or on
behalf of, their customers. Class Y Shares are not sold subject to a
sales load and do not bear expenses under the Plans pertaining to Class
A and Class C Shares. The amount of dividends payable with respect to
Class Y Shares will exceed dividends on Class A and Class C Shares as a
result of the Plan fees applicable to Class A and Class C Shares and
because Class A and Class C Shares may bear additional retail transfer
agency expenses. For further details regarding eligibility

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<PAGE>

requirements for the purchase of Class Y Shares, call the Trust at
1-800-743-8637.

Each Fund intends to seek a ruling from the IRS to the effect that
differing distributions among the classes of its Shares will not result
in the Fund's dividends or other distributions being regarded as
"preferential dividends" under the Code. While similar rulings have
been issued by the IRS, complete assurance cannot, of course, be given
that the Funds will receive such rulings. For additional information,
see the Statement of Additional Information.

Performance Information

From time to time performance information for the Funds showing their
average annual total return, aggregate total return and/or yield may be
presented in advertisements, sales literature and Shareholder reports.
Such performance figures are based on historical earnings and are not
intended to indicate future performance. Also, from time to time, the
Funds may present their respective distribution rates for a class of
Shares in supplemental sales literature which is accompanied or preceded
by a prospectus and in Shareholder reports.

Standardized yield and total return quotations will be computed
separately for Class A, Class C and Class Y Shares. Because of
differences in the fees and/or expenses borne by Class A, Class C and
Class Y Shares of the Funds, the net yield and total return on Class A
and Class C Shares can be expected, at any given time, to be lower than
the net yield and total return on Class Y Shares for the same period.

Investors may also judge the performance of any class of Shares or Fund
by comparing or referencing it to the performance of other mutual funds
with comparable investment objectives and policies through various
mutual fund or market indices such as those prepared by various
services, which indices may be published by such services or by other
services or publications, including, but not limited to, ratings
published by Morningstar, Inc. In addition to performance information,
general information about the Funds that appears in such publications
may be included in advertisements, in sales literature and in reports to
Shareholders. For further information regarding such services and
publications, see "ADDITIONAL INFORMATION -- Performance Comparisons" in
the Statement of Additional Information.

Total return and yield are functions of the type and quality of
instruments held in the portfolio, operating expenses, and market
conditions. Any fees charged with respect to customer accounts for
investing in Shares of the Funds will not be included in performance
calculations; such fees, if charged, will reduce the actual performance
from that quoted. In addition, if Qualivest and BISYS voluntarily
reduce all or a part of their respective fees,

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<PAGE>

the total return of such Fund will be higher than it would otherwise be
in the absence of such voluntary fee reductions.

Account Services

Shareholders of the Trust may obtain current price, yield and other
performance information on the Funds or any of the Trust's funds 24
hours a day by calling 1-800-743-8637 from any touch-tone telephone.

Miscellaneous

Shareholders will receive unaudited semi-annual reports and annual
reports audited by independent public accountants. Inquiries regarding
the Trust may be directed in writing to Qualivest Funds at 3435 Stelzer
Road, Columbus, Ohio 43219-3035, or by calling toll free 1-800-743-8637.

No person has been authorized to give any information or to make any
representations not contained in this Prospectus 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 by their Distributor in any jurisdiction in
which such offering may not lawfully be made.

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<PAGE>

THE QUALIVEST MONEY MARKET FUNDS:

BROUGHT TO YOU BY U.S. BANCORP SECURITIES

Competitive yields, optimum flexibility, and quality local
investment management--U.S. Bancorp Securities is proud to offer
the Qualivest money market funds as a part of its full range of
services for commercial and institutional investors.

The strength of these funds is based on the solid investment
expertise of our affiliate, Qualivest Capital Management, Inc.,
and the quality customer service that institutional investors
have come to count on from U.S. Bancorp Securities, which
executes up to $3 billion in transactions each month as one of
the Northwest's premier broker-dealers.

COMPETITIVE YIELDS--IN A FLEXIBLE ACCOUNT

The Qualivest money market funds were established to provide
institutional investors with quality and commitment:

. Nationally recognized, locally delivered investment management expertise.

. 11:30 a.m. cutoff time for investments; 11:30 a.m. for redemptions.

. Investment transactions can be linked to U.S. Bank accounts--for immediate
credits or debits.

QUALIVEST CAPITAL MANAGEMENT, INC.
THE PEOPLE BEHIND THE PERFORMANCE

Your investment in the Qualivest money market funds benefits
from the expertise of the professionals at Qualivest Capital
Management, Inc., a Northwest-based investment management firm
that combines the advantages of institutional size and strength
with the entrepreneurship of a private investment counselor.

Qualivest money market fund investors are in good company;
Qualivest Capital Management, Inc. invests and manages over $6.5
billion for a client base that includes 401(k) plans, pension
and profit-sharing plans, corporations and private individuals.

<PAGE>
QUALIVEST
FUNDS

CLASS Q SHARES

QUALIVEST U.S. TREASURY MONEY MARKET FUND
QUALIVEST MONEY MARKET FUND
QUALIVEST TAX-FREE MONEY MARKET FUND

<TABLE>
<S> <C>
INVESTMENT ADVISER LEGAL COUNSEL
Qualivest Capital Management, Inc. Dechert Price & Rhoads
P.O. Box 2758 1500 K Street, N.W.
Portland, Oregon 97208 Washington, D.C. 20005-1208

ADMINISTRATOR & DISTRIBUTOR AUDITORS
BISYS Fund Services Deloitte & Touche LLP
3435 Stelzer Road 1700 Courthouse Plaza Northeast
Columbus, Ohio 43219-3035 Dayton, Ohio 45402
</TABLE>

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary............................................... 3
Fund Expenses.................................................... 4
Fee Table........................................................ 5
Selected Financial Information................................... 7
Investment Objectives and Policies............................... 8
Investment Techniques and Risk Factors........................... 10
Valuation of Shares.............................................. 16
Purchasing Shares................................................ 16
Redeeming Shares................................................. 18
Management of the Funds.......................................... 19
Distribution Plan................................................ 22
Dividends and Taxes.............................................. 23
General Information.............................................. 25
</TABLE>

PROSPECTUS DATED NOVEMBER 15, 1995

3435 Stelzer Road
Columbus, Ohio
43219 1-800-743-8637

- Qualivest U.S. Treasury Money Market Fund;

- Qualivest Money Market Fund; and

- Qualivest Tax-Free Money Market Fund.

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"), acts as
the investment adviser to each of the Funds.

Continued on next page

The Shares of the Funds are not insured or guaranteed by the United States
Government. Each of these Funds seeks to maintain a constant net asset value of
$1.00 per Share, but there can be no assurance that net asset value will not
vary.

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

2
<PAGE>
PROSPECTUS SUMMARY

<TABLE>
<S> <C>
Shares Offered........................ Class Q Shares of the Qualivest U.S. Treasury Money
Market Fund (the "U.S. Treasury Fund"), the
Qualivest Money Market Fund (the "Money Market
Fund") and the Qualivest Tax-Free Money Market
Fund (the "Tax-Free Money Market Fund") (collec-
tively, the "Funds"), which are three separate
diversified investment portfolios ("funds") of
Qualivest Funds, a Massachusetts business trust
(the "Trust") which is registered as an open-end
management investment company.

Offering Price........................ The public offering price of each Fund is equal to
the net asset value per Share, which the Trust will
seek to maintain at $1.00.

Investment Objectives

U.S. Treasury Fund and
Money Market Fund............... The U.S. Treasury Fund and the Money Market Fund
seek current income consistent with liquidity and
stability of principal.

Tax-Free Money Market Fund........ The Tax-Free Money Market Fund seeks current
income, free from federal income tax, consistent
with liquidity and stability of principal.

Investment Policies

Money Market Fund................. Under normal market conditions, the Money Market
Fund will invest in high quality (i.e., rated
within the top two rating categories by a
nationally recognized statistical rating
organization ("NRSRO"), such as Standard & Poor's
Corporation ("S&P"), Moody's Investors Service,
Inc. ("Moody's") and Fitch Investors Service
("Fitch")) money market instruments and other
comparable investments.

3
<PAGE>

<TABLE>
<S> <C>
treated as a preference item for individuals for
purposes of the federal alternative minimum tax.

Investment Adviser.................... Qualivest Capital Management, Inc. ("Qualivest"),
Portland, Oregon, a subsidiary of the United
States National Bank of Oregon ("U.S. Bank"),
serves as investment adviser to each Fund and
receives from each Fund a fee for providing these
services. See "MANAGEMENT OF THE FUNDS -
Investment Adviser."

Dividends and Capital Gains........... Dividends from net income, excluding short-term
capital gains, are declared daily and paid monthly.
Dividends from short-term capital gains, if any,
are declared and paid as deemed appropriate.

Other Information..................... U.S. Bank is the Funds' custodian. BISYS Fund
Services ("BISYS" or "Distributor" or
"Administrator") serves as the distributor and
administrator of the Funds. BISYS Fund Services
Ohio, Inc. ("Transfer Agent") serves as the
transfer agent and dividend disbursing agent and
provides certain accounting services for the
Trust.
</TABLE>

FUND EXPENSES

The following expense tables indicate costs and expenses that an investor
should anticipate incurring either directly or indirectly as a Shareholder of a
Fund.

4
<PAGE>
FEE TABLE

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST
U.S. TREASURY MONEY MARKET TAX-FREE MONEY
MONEY MARKET FUND FUND MARKET FUND
----------------- ------------ --------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price)..... None None None
Maximum Sales Charge Imposed on Reinvested
Dividends (as a percentage of offering
price).................................. None None None
Deferred Sales Charge (as a percentage of
redemption proceeds).................... None None None
Redemption Fees (as a percentage of
redemption proceeds).................... None None None
Exchange Fees............................. None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets
annualized)
Management Fees After Waiver1............. 0.00% 0.25% 0.00%
12b-1 Fees2............................... 0.20% 0.00% 0.25%
Other Expenses............................ 0.32% 0.27% 0.55%
----- ----- -----
Total Fund Operating Expenses After
Waiver3....................................... 0.52% 0.52% 0.80%
----- ----- -----
----- ----- -----
</TABLE>

- ------

1 Qualivest has agreed to temporarily waive a portion of its investment advisory
fee for all of the Funds for the current fiscal year. Waived fees cannot be
recovered at a future date. Absent the advisory fee waiver, "Management Fees"
as a percentage of average daily net assets would be 0.35% for each of the
Funds. See "MANAGEMENT OF THE FUNDS--Investment Adviser."

2 The Money Market Fund has determined that it will not pay 12b-1 fees under the
Distribution Plan, and the U.S. Treasury Fund has determined that it will pay
0.20% in 12b-1 fees under the Distribution Plan, through the current fiscal
year. Otherwise, "12b-1 Fees" as a percentage of average daily net assets are
payable at an annual rate of up to 0.25% for each Fund. See "DISTRIBUTION
PLAN."

3 Absent the waiver of the investment advisory fee, "Total Fund Operating
Expenses" as a percentage of average daily net assets would be 0.87% for the
U.S. Treasury Fund, 0.62% for the Money Market Fund and 1.15% for the Tax-Free
Money Market Fund.

The purpose of this table is to assist the prospective investor in
understanding the various costs and expenses that a Shareholder in the Funds
will bear. The table has been restated to reflect the current fees for the
Funds.

5
<PAGE>
EXAMPLE*

An investor would pay the following expenses on a $1,000 investment in Class
Q Shares, assuming (1) 5% annual return, and (2) redemption at the end of each
time period:

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST
U.S. TREASURY MONEY MARKET TAX-FREE MONEY
MONEY MARKET FUND FUND MARKET FUND
----------------- ------------ --------------
<S> <C> <C> <C>
1 Year........................................ $ 5 $ 5 $ 8
3 Years....................................... $17 $ 17 $ 26
5 Years....................................... $29 $ 29 $ 44
10 Years...................................... $65 $ 65 $ 99
</TABLE>

- ------

* This example should not be considered a representation of future expenses,
which may be more than those shown. The assumed 5% annual return is
hypothetical and should not be considered a representation of past or future
annual return. Actual return may be greater or less than the assumed amount.

6
<PAGE>
SELECTED FINANCIAL INFORMATION

<TABLE>
<CAPTION>
QUALIVEST
QUALIVEST TAX-FREE
QUALIVEST U.S. TREASURY MONEY MARKET FUND MONEY MARKET FUND
MONEY MARKET FUND JANUARY 10, 1995 JANUARY 9, 1995
JANUARY 11, 1995 TO TO TO
JULY 31, 1995(a) JULY 31, 1995(a) JULY 31, 1995(a)
----------------------- ----------------- -----------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD.............................. $ 1.000 $ 1.000 $ 1.000
------- -------- -------
INVESTMENT ACTIVITIES
Net investment income........... 0.029 0.031 0.017
DISTRIBUTIONS
Net investment income........... (0.029) (0.031) (0.017)
------- -------- -------
NET ASSET VALUE, END OF PERIOD...... $ 1.000 $ 1.000 $ 1.000
------- -------- -------
------- -------- -------
TOTAL RETURN(b)..................... 2.90 % 3.13 % 1.73 %

RATIOS/SUPPLEMENTAL DATA
Net assets at end of period
(000)......................... 9,$659 55,$346 1,$250
Ratio of expenses to average net
assets(c)..................... 0.61 % 0.54 % 0.85 %
Ratio of net investment income
to average net assets(c)...... 5.25 % 5.57 % 3.19 %
Ratio of expenses to average net
assets*(c).................... 1.01 % 0.90 % 1.21 %
Ratio of net investment income
to average net assets*(c)..... 4.86 % 5.22 % 2.83 %
</TABLE>

- ------

* During the period the investment advisory and custodian fees were voluntarily
reduced. If such voluntary fee reductions had not occurred, the ratios would
have been as indicated.

(a) Period from commencement of operations.

(b) Not annualized.

7
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES

GENERAL

* * * *

The investment objective of each Fund is a fundamental policy and as such may
not be changed without a vote of the holders of a majority of the outstanding
Shares of that Fund. Other policies of a Fund may be changed without a vote of
the holders of a majority of outstanding Shares of that Fund unless (i) the
policy is expressly deemed to be a fundamental policy, or (ii) the policy is
expressly deemed to be changeable only by such majority vote. There can be no
assurance that the investment objective of any Fund will be achieved.

INVESTMENT POLICIES

Although each Fund has the same investment adviser and a similar investment
objective, its particular portfolio securities and yield may differ due to
differences in the types of permitted investments, cash flow, and the
availability of particular portfolio investments.

U.S. TREASURY FUND

This Fund expects that a majority of its income will be exempt from state
taxes as a result of its investing in U.S. Government securities whose interest
payments are state tax-exempt. Most states allow for a pass-through of this tax
exemption, so that the Fund's dividend distributions may also be state
tax-exempt with respect to the income earned by the Fund on U.S. Government
securities.

MONEY MARKET FUND

8
<PAGE>
TAX-FREE MONEY MARKET FUND

The Tax-Free Money Market Fund invests primarily in high quality money market
obligations issued by or on behalf of states (including the District of
Columbia), territories, and possessions of the United States and their
respective authorities, agencies, instrumentalities, and political subdivisions,
the interest on which is both exempt from federal income tax and not treated as
a preference item for purposes of the federal alternative minimum tax, and
similar tax-exempt money market instruments that, although not rated, are deemed
to be of comparable high quality as determined by Qualivest pursuant to
guidelines adopted by the Board of Trustees ("Municipal Securities"). As a
matter of fundamental policy, under normal market conditions, at least 80% of
the Tax-Free Money Market Fund's net assets will be invested in short-term
Municipal Securities.

* * * *

Each Fund invests exclusively in U.S. dollar denominated instruments which
Qualivest, acting pursuant to guidelines adopted by the Board of Trustees,
determines present minimal credit risks and which at the time of acquisition are
rated by one or more appropriate NRSROs (e.g., S&P, Moody's and Fitch) within
one of the two highest rating categories for short-term debt obligations or, if
unrated, are of comparable quality. In addition, each Fund except for the
Tax-Free Money Market Fund diversifies its investments so that, with minor
exceptions and except for U.S. Government securities, not more than 5% of its
total assets is invested in the securities of any one issuer, not more than 5%
of its total assets is invested in securities of all issuers rated by the NRSRO
at the time of investment in the second highest rating category for short-term
debt obligations or in unrated securities deemed to be of comparable quality to
securities rated in the second highest rating categories for short-term debt
obligations ("Second Tier Securities") and not more than the greater of 1% of
total assets or one million dollars is invested in the securities of any one
issuer of Second Tier Securities. In addition, no Fund will invest more than 10%
of its net assets in securities that are deemed to be illiquid at the time of
purchase. All securities or instruments in which a Fund invests have remaining
maturities of 397 calendar days (thirteen months) or less. The dollar-weighted
average maturity of the obligations in a Fund will not exceed 90 days.

Subject to the foregoing general limitations, the Funds expect to invest in
the types of securities discussed below under "INVESTMENT TECHNIQUES AND RISK
FACTORS." These securities include short-term obligations

9
<PAGE>

issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, short-term asset-backed and mortgage-related securities,
bankers' acceptances, certificates of deposit and time deposits (including
Eurodollar Certificates of Deposit ("ECDs"), Eurodollar Time Deposits ("ETDs"),
Canadian Time Deposits ("CTDs"), and Yankee Certificates of Deposit ("Yankee
CDs")), commercial paper (including variable amount master demand notes),
securities issued by other money market investment companies, Guaranteed
Investment Contracts, repurchase agreements, reverse repurchase agreements and
dollar roll agreements.

INVESTMENT TECHNIQUES AND RISK FACTORS

Like any investment program, an investment in a Fund entails certain risks.

U.S. GOVERNMENT OBLIGATIONS

The types of U.S. Government obligations in which each Fund may invest include
U.S. Treasury notes, bills, bonds and any other securities directly issued by
the U.S. Government that are available for public investment, which differ only
in their interest rates, maturities, and times of issuance, as well as
"stripped" U.S. Treasury obligations, such as Treasury Receipts issued by the
U.S. Treasury and representing either future interest or principal payments, and
obligations issued or guaranteed by the U.S. Government or its agencies or
instrumentalities. Stripped securities are issued at a discount to their "face
value" and may exhibit greater price volatility than ordinary debt securities
because of the manner in which their principal and interest are returned to
investors. The stripped Treasury obligations in which the Funds may invest do
not include Certificates of Accrual on Treasury Securities ("CATS") or Treasury
Income Growth Receipts ("TIGRs").

Obligations of certain agencies and instrumentalities of the U.S. Government,
such as the Government National Mortgage Association, are supported by the full
faith and credit of the U.S. Treasury; others, such as those of the Federal
National Mortgage Association, are supported by the right of the issuer to
borrow from the Treasury; others, such as those of the Student Loan Marketing
Association, are supported by the discretionary authority of the U.S. Government
to purchase the agency's obligations; still others, such as those of the Federal
Farm Credit Banks or the Federal Home Loan Mortgage Corporation, are supported
only by the credit of the instrumentality. No assurance can be given that the
U.S. Government would provide financial support to U.S. Government-sponsored
agencies or instrumentalities if it is not obligated to do so by law. The Funds
will invest in the obligations of such agencies or instrumentalities only when
Qualivest believes that the credit risk with respect thereto is minimal. The
U.S. Government does not guarantee the market value of any security; therefore,
the market value of the U.S. Government obligations in a Fund's portfolio can be
expected to fluctuate as interest rates change.

MORTGAGE-RELATED AND ASSET-BACKED SECURITIES

10
<PAGE>
Early repayment of principal on mortgage-related securities (arising from
prepayments of principal due to sale of the underlying property, refinancing, or
foreclosure, net of fees and costs which may be incurred) may expose a Fund to a
lower rate of return upon reinvestment of principal. Also, if a security subject
to prepayment has been purchased at a premium, in the event of prepayment, the
value of the premium would be lost. Like other fixed-income securities, when
interest rates rise, the value of a mortgage-related security generally will
decline; however, when interest rates decline, the value of mortgage-related
securities with prepayment features may not increase as much as other
fixed-income securities. For this and other reasons, the stated maturity of a
mortgage-related security may be shortened by unscheduled prepayments on the
underlying mortgages and, accordingly, it is not possible to predict accurately
the security's return to a Fund.

Like mortgages underlying mortgage-backed securities, automobile sales
contracts or credit card receivables underlying asset-backed securities are
subject to prepayment, which may reduce the overall return to certificate
holders. Nevertheless, principal prepayment rates tend not to vary much with
interest rates, and the short-term nature of the underlying car loans or other
receivables tends to dampen the impact of any change in the prepayment level.
Certificate holders may also experience delays in prepayment on the certificates
if the full amounts due on underlying sales contracts or receivables are not
realized because of unanticipated legal or administrative costs of enforcing the
contracts or because of depreciation or damage to the collateral (usually
automobiles) securing certain contracts, or other factors. In certain market
conditions, asset-backed securities may experience volatile fluctuations in
value and periods of illiquidity. If consistent with its investment objective
and policies, each Fund may invest in other asset-backed securities that may be
developed in the future.

The staff of the Securities and Exchange Commission is of the view that
certain issuers of asset-backed securities not complying with Securities and
Exchange Commission regulations are investment companies under the Investment
Company Act of 1940 (the "1940 Act"). The Funds intend to conduct their
operations in a manner consistent with this view and, among other things,
generally will not invest more than 25% of their total assets (when combined
with investments in securities of other investment companies, if any) in the
obligations of such issuers without obtaining appropriate regulatory relief.

BANKERS' ACCEPTANCES

CERTIFICATES OF DEPOSIT AND TIME DEPOSITS

11
<PAGE>
certificates of deposit issued by a U.S. branch of a foreign bank denominated in
U.S. dollars and held in the United States.

None of the Funds will invest in excess of 10% of its net assets in time
deposits with maturities in excess of seven days which are subject to penalties
upon early withdrawal. Such time deposits include ETDs and CTDs but do not
include certificates of deposit.

COMMERCIAL PAPER

Within the limitations described above, each Fund may invest in short-term
promissory notes issued by corporations (including variable amount master demand
notes) rated at the time of purchase within the two highest categories assigned
by an NRSRO (e.g., A-2 or better by S&P, Prime-2 or better by Moody's or F-2 or
better by Fitch) or, if not rated, found by Qualivest pursuant to guidelines
adopted by the Board of Trustees to be of comparable quality to instruments that
are so rated. Instruments may be purchased in reliance upon a rating only when
the rating organization is not affiliated with the issuer or guarantor of the
instrument. For a description of the rating symbols of the NRSROs, see the
Appendix to the Statement of Additional Information. The Money Market Fund may
also invest in Canadian Commercial Paper ("CCP"), which is commercial paper
issued by a Canadian corporation or a Canadian counterpart of a U.S.
corporation, and in Europaper, which is U.S. dollar denominated commercial paper
of a foreign issuer.

SECURITIES ISSUED BY OTHER INVESTMENT COMPANIES

Each of the Funds may invest up to 25% of its total assets in shares of money
market mutual funds for cash management purposes. The U.S. Treasury Fund expects
to make such purchases only in money market funds that restrict their
investments to U.S. Government securities. A Fund will incur additional expenses
due to the duplication of expenses as a result of investing in other investment
companies.

RESTRICTED SECURITIES

12
<PAGE>
are sold to institutional investors, such as the Funds, who agree that they are
purchasing the securities for investment and not with a view to public
distribution. Any resale must also generally be made in an exempt transaction.
Section 4(2) securities are normally resold to other institutional investors
through or with the assistance of the issuer or investment dealers who make a
market in such Section 4(2) securities, thus providing liquidity. Pursuant to
procedures adopted by the Board of Trustees, Qualivest may determine Section
4(2) securities to be liquid if such securities are readily marketable. These
securities may include securities eligible for resale under Rule 144A under the
1933 Act.

FOREIGN INVESTMENTS

Investments in ECDs, ETDs, CTDs, Yankee CDs, CCP, and Europaper may subject
the Funds to investment risks that differ in some respects from those related to
investments in obligations of U.S. domestic issuers. Such risks include future
adverse political and economic developments, the possible imposition of
withholding taxes on interest income, possible seizure, nationalization, or
expropriation of foreign deposits, the possible establishment of exchange
controls, or the adoption of other foreign governmental restrictions which might
adversely affect the payment of principal and interest on such obligations. In
addition, foreign branches of U.S. banks and foreign banks may be subject to
less stringent reserve requirements and to different accounting, auditing,
reporting, and recordkeeping standards than those applicable to domestic
branches of U.S. banks. The Funds will acquire securities issued by foreign
branches of U.S. banks, foreign banks, or other foreign issuers only when
Qualivest believes that the risks associated with such instruments are minimal.

PRIVATE ACTIVITY BONDS

The Tax-Free Money Market Fund may also invest in private activity bonds. It
should be noted that the Tax Reform Act of 1986 substantially revised provisions
of prior federal law affecting the issuance and use of proceeds of certain
tax-exempt obligations. A new definition of private activity bonds applies to
many types of bonds, including those which were industrial development bonds
under prior law. Interest on private activity bonds is tax-exempt (and such
bonds will be considered Municipal Securities for purposes of this Prospectus)
only if the bonds fall within certain defined categories of qualified private
activity bonds and meet the requirements specified in those respective
categories. If the Tax-Free Money Market Fund invests in private activity bonds
which fall outside these categories, the interest from such bonds will not be
exempt from federal income tax. The Tax Reform Act generally does not change the
federal tax treatment of bonds issued to finance government operations. For
further information relating to the types of private activity bonds which will
be included in income subject to the alternative minimum tax, see "ADDITIONAL
INFORMATION--Additional Tax Information" in the Statement of Additional
Information.

MUNICIPAL SECURITIES

The Tax-Free Money Market Fund will invest only in those Municipal Securities
which are considered by Qualivest to present minimal credit risks and which at
the time of purchase are rated high quality by an NRSRO (e.g., rated in the top
two categories) or which are unrated at the time of purchase but are determined
to be of comparable quality by Qualivest pursuant to guidelines approved by the
Trust's Board of Trustees. Municipal Securities may be purchased in reliance
upon a rating only where the rating organization is not affiliated with the
issuer or guarantor of the Municipal Securities. If a security is subject to a
demand feature, the

13
<PAGE>
security must receive both a short-term and a long-term high quality rating or
must be determined to be of comparable quality by Qualivest; except that where
the demand feature is considered to be "unconditional" under the 1940 Act, the
security may be acquired solely in reliance on a short-term high quality rating
or a determination of comparable quality by Qualivest of the unconditional
demand feature. The applicable Municipal Securities ratings are described in the
Appendix to the Statement of Additional Information.

The two principal classifications of Municipal Securities which may be held by
the Fund are "general obligation" securities and "revenue" securities. General
obligation securities are secured by the issuer's pledge of its full faith,
credit and taxing power for the payment of principal and interest. Revenue
securities are payable only from the revenues derived from a particular facility
or class of facilities or, in some cases, from the proceeds of a special excise
tax or other specific revenue source such as the user of the facility being
financed.

Municipal Securities purchased by the Tax-Free Money Market Fund may include
rated and unrated variable and floating rate tax-exempt notes, which may have a
stated maturity in excess of 397 days but which will, in such event, be subject
to a demand feature that will permit the Fund to demand payment of the principal
of the note either (i) at any time upon not more than thirty days' notice or
(ii) at specified intervals not exceeding 397 days and upon no more than thirty
days' notice. There may be no active secondary market with respect to a
particular variable or floating rate note. Nevertheless, the periodic
readjustments of their interest rates tend to assure that their value to the
Fund will approximate their par value. Variable and floating rate notes for
which no readily available market exists will be purchased in an amount which,
together with other illiquid securities, exceeds 10% of the Fund's net assets
only if such notes are subject to a demand feature that will permit the Fund to
receive payment of the principal within seven days after demand by the Fund.

The Tax-Free Money Market Fund may acquire zero coupon obligations, which have
greater price volatility than coupon obligations and which will not result in
the payment of interest until maturity.

The Fund may also purchase Municipal Securities on a "when-issued" basis.
"When-issued" securities are securities purchased for delivery beyond the normal
settlement date at a stated price and yield, thereby involving the risk that the
yield obtained in the transaction will be less than that available in the market
when delivery takes place. The Fund will not pay for such securities, and no
income accrues on the securities, until they are received. Securities purchased
on a "when-issued" basis are recorded as an asset and are subject to changes in
value based upon changes in the general level of interest rates. The Fund's
commitments to purchase "when-issued" securities will not exceed 25% of the
value of its total assets under normal market conditions, and

14
<PAGE>
a commitment by the Fund to purchase "when-issued" securities will not exceed 60
days.

Opinions relating to the validity of Municipal Securities and to the exemption
of interest thereon from federal income tax are rendered by bond counsel to the
respective issuers at the time of issuance. Neither the Fund nor Qualivest will
review the proceedings relating to the issuance of Municipal Securities or the
basis for such opinions. Although the Tax-Free Money Market Fund presently does
not intend to do so on a regular basis, it may invest more than 25% of its total
assets in Municipal Securities which are related in such a way that an economic,
business, or political development or change affecting one such security would
likewise affect the other Municipal Securities. Examples of such securities are
obligations the repayment of which is dependent upon similar types of projects
or projects located in the same state. Such investments would be made only if
deemed necessary or appropriate by Qualivest. To the extent that the Tax-Free
Money Market Fund's assets are concentrated in Municipal Securities that are so
related, the Tax-Free Money Market Fund will be subject to the peculiar risks
presented by such Municipal Securities, such as negative developments in a
particular industry or state, to a greater extent than it would be if the
Tax-Free Money Market Fund's assets were not so concentrated.

PUTS

The Tax-Free Money Market Fund may acquire "puts" with respect to Municipal
Securities held in its portfolio. Under a put, the Tax-Free Money Market Fund
would have the right to sell a specified Municipal Security within a specified
period of time at a specified price. A put would be sold, transferred, or
assigned only with the underlying Municipal Security. The Tax-Free Money Market
Fund will acquire puts solely to either facilitate portfolio liquidity, shorten
the maturity of the underlying Municipal Securities, or permit the investment of
the Tax-Free Money Market Fund's assets at a more favorable rate of return. The
aggregate price of a security subject to a put may be higher than the price
which otherwise would be paid for the security without such an option, thereby
increasing the security's cost and reducing its yield.

REPURCHASE AGREEMENTS

Securities held by the Money Market and Tax-Free Money Market Funds may be
subject to repurchase agreements. Under the terms of a repurchase agreement, a
Fund would acquire securities from financial institutions, subject to the
seller's agreement to repurchase such securities at a mutually agreed upon date
and price, which includes interest negotiated on the basis of current short-term
rates. The seller under a repurchase agreement will be required to maintain at
all times the value of collateral held pursuant to the agreement at not less
than the repurchase price (including accrued interest). If a seller defaults on
its repurchase obligations, a Fund may suffer a loss in disposing of the
security subject to the repurchase agreement. For further information about
repurchase agreements, see "INVESTMENT OBJECTIVES AND POLICIES--Additional
Information on Portfolio Instruments--Repurchase Agreements" in the Statement of
Additional Information.

REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLL AGREEMENTS

15
<PAGE>

cal to a reverse repurchase agreement except for the fact that substantially
similar securities may be repurchased. At the time a Fund enters into a reverse
repurchase agreement or dollar roll agreement, it will place in a segregated
custodial account assets such as U.S. Government securities or other liquid high
grade debt securities consistent with the Fund's investment restrictions having
a value equal to the repurchase price (including accrued interest), and will
subsequently continually monitor the account to ensure that such equivalent
value is maintained at all times. Reverse repurchase agreements and dollar roll
agreements involve the risk that the market value of the securities sold by a
Fund may decline below the price at which the Fund is obligated to repurchase
the securities.

VALUATION OF SHARES

The net asset value of each Fund is determined and its Shares are priced as of
11:30 a.m. Pacific Time and as of the close of regular trading on the New York
Stock Exchange ("NYSE") (generally 1:00 p.m. Pacific Time) on each Business Day
("Valuation Time"). As used herein a "Business Day" is a day on which the NYSE
is open for trading, the Federal Reserve Bank of San Francisco is open, and any
other day except days on which there are insufficient changes in the value of a
Fund's portfolio securities to materially affect the Fund's net asset value or
days on which no Shares are tendered for redemption and no order to purchase any
Shares is received. Currently, the NYSE or the Federal Reserve Bank of San
Francisco is closed on the following holidays: New Year's Day, Martin Luther
King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Columbus Day, Veteran's Day, Thanksgiving and Christmas.

The assets in each Fund are valued based upon the amortized cost method.
Pursuant to the rules and regulations of the Securities and Exchange Commission
regarding the use of the amortized cost method, each Fund will maintain a
dollar-weighted average portfolio maturity of 90 days or less. Although the
Trust seeks to maintain each Fund's net asset value per Share at $1.00, there
can be no assurance that net asset value per Share will not vary.

PURCHASING SHARES

Class Q Shares may be purchased through a broker-dealer who has established a
dealer agreement with the Distributor. Class Q Shares of each Fund are
continuously offered and also may be purchased directly either by mail, by
telephone, or by wire.

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<PAGE>
An Account Application Form can be obtained by calling the Trust at
1-800-743-8637.

OTHER INFORMATION REGARDING PURCHASES

Class Q Shares may also be purchased through procedures established by the
Distributor in connection with the requirements of qualified accounts maintained
by or on behalf of certain persons ("Customers") by U.S. Bank or one of its
affiliates. Class Q Shares of the Funds sold to U.S. Bank or an affiliate acting
in a fiduciary, advisory, custodial, agency, or other similar capacity on behalf
of Customers will normally be held of record by U.S. Bank or the affiliate. With
respect to Class Q Shares so sold, it is the responsibility of the holder of
record to transmit purchase or redemption orders to the Distributor and to
deliver funds for the purchase thereof on a timely basis. Beneficial ownership
of such Class Q Shares of the Funds will be recorded by U.S. Bank or one of its
affiliates and reflected in the account statements provided to Customers. U.S.
Bank or one of its affiliates may exercise voting authority for those Class Q
Shares for which it has been granted authority by the Customer.

Purchases of Class Q Shares of the Funds will be executed at the next
calculated net asset value per Share following the receipt by the Trust of an
order to purchase Class Q Shares in good form ("public offering price"). In the
case of orders for the purchase of Class Q Shares placed through a
broker-dealer, the applicable public offering price will be the net asset value
as so determined, but only if the Distributor receives the order prior to the
next Valuation Time for that day and transmits it to the Trust by that Valuation
Time. The broker-dealer is responsible for transmitting such orders promptly. If
the broker-dealer fails to do so, the investor's right to that day's closing
price must be settled between the investor and the broker-dealer. Purchases of
Class Q Shares of any of the Funds will be effected only on a Business Day of
the Funds. An order received prior to a Valuation Time on any Business Day will
be executed at the net asset value determined as of the next Valuation Time on
the date of receipt. An order received after the final Valuation Time on any
Business Day will be executed at the net asset value determined as of the next
Valuation Time on the next Business Day of that Fund. Shares of the Funds
purchased before 11:30 a.m. Pacific Time begin earning dividends on the same
Business Day. Shares of the Funds purchased after 11:30 a.m. Pacific Time begin
earning dividends on the next Business Day. All Shares of the Funds continue to
earn dividends through the day before their redemption.

Depending upon the terms of a particular Customer account, U.S. Bank or one of
its affiliates may charge a Customer account fees for services provided in
connection with investment in a Fund. Information concerning these services and
any charges may be obtained from U.S. Bank or the affiliate. This Prospectus
should be read in conjunction with any such information so received.

Every Shareholder will receive a confirmation of, or account statement
reflecting, each new transaction in the Shareholder's account, which will also
show the total number of Class Q Shares of the respective Fund owned by the
Shareholder. Shareholders may rely on these statements in lieu of certificates.
Certificates representing Class Q Shares of the Funds will not be issued.

EXCHANGE PRIVILEGE

Shareholders may exchange Class Q Shares of one of the Funds for Class Q
Shares offered by another Fund so long as the exchange is made in

17
<PAGE>
states where it is legally authorized. The exchange will be made on the basis of
the relative net asset values of the Class Q Shares exchanged. Class Q Shares
may not be exchanged for Class A or Class Y Shares of the Funds, or with the
Shares of any other fund of the Trust.

An exchange is considered to be a sale of Class Q Shares for federal income
tax purposes; however, dispositions of Shares of the Funds will not give rise to
a gain or loss if the Funds maintain a net asset value per Share of one dollar.

A Shareholder wishing to exchange his or her Shares may do so by contacting
the Trust at 1-800-743-8637, by contacting their broker-dealer, or by providing
written instructions to the Distributor. For a discussion of risks associated
with unauthorized telephone exchanges, see "REDEEMING SHARES--By Telephone"
below.

REDEEMING SHARES

Shareholders may redeem their Class Q Shares without charge on any day that
net asset value is calculated (see "VALUATION OF SHARES"). Redemptions will be
effected at the net asset value per Share next determined after receipt of a
redemption request by the Distributor. Redemptions may be requested by mail or
by telephone.

BY MAIL

A written request for redemption must be received by the Distributor in order
to honor the request. The Distributor's address is: BISYS Fund Services, 3435
Stelzer Road, Columbus, Ohio 43219-3035. The Transfer Agent will require a
signature guarantee by an eligible guarantor institution. The signature
guarantee requirement will be waived if all of the following conditions apply:
(1) the redemption check is payable to the Shareholder(s) of record, and (2) the
redemption check is mailed to the Shareholder(s) at the address of record. The
Shareholder may also have the proceeds mailed to a commercial bank account
previously designated on the Account Application Form. There is no charge for
having redemption proceeds mailed to a designated bank account. To change the
address to which a redemption check is to be mailed, a written request therefor
must be received by the Transfer Agent. In connection with such request, the
Transfer Agent will require a signature guarantee by an eligible guarantor
institution.

For purposes of this policy, the term "eligible guarantor institution" shall
include banks, brokers, dealers, credit unions, securities exchanges and
associations, clearing agencies and savings associations as those terms are
defined in the Securities Exchange Act of 1934. The Transfer Agent reserves the
right to reject any signature guarantee if (1) it has reason to believe that the
signature is not genuine, (2) it has reason to believe that the transaction
would otherwise be improper, or (3) the guarantor institution is a broker or
dealer that is neither a member of a clearing corporation nor maintains net
capital of at least $100,000.

BY TELEPHONE

Class Q Shares may be redeemed by telephone if the Account Application Form
reflects that the Shareholder has elected that privilege. If the telephone
feature was not originally selected, the Shareholder must provide written
instructions to the Trust to add it. The Shareholder may have the proceeds
mailed to his or her address or mailed or wired to a commercial bank account
previously designated on the Account Application Form. Under most circumstances,
payments will be transmitted on the next Business Day. Wire redemption requests
may be made by the

18
<PAGE>
Shareholder by telephone to the Trust at 1-800-743-8637. While the Transfer
Agent currently does not charge a wire redemption fee, the Transfer Agent
reserves the right to impose such a fee in the future.

The Trust's Account Application Form provides that none of BISYS, the Transfer
Agent, Qualivest, the Trust or any of their affiliates or agents will be liable
for any loss, expense or cost when acting upon any oral, wired or electronically
transmitted instructions or inquiries believed by them to be genuine. While
precautions will be taken, as more fully described below, Shareholders bear the
risk of any loss as the result of unauthorized telephone redemptions or
exchanges believed by the Transfer Agent to be genuine. The Trust will employ
reasonable procedures to confirm that instructions communicated by telephone are
genuine. These procedures include recording all phone conversations, sending
confirmations to Shareholders within 72 hours of the telephone transaction,
verifying the account name and sending redemption proceeds only to the address
of record or to a previously authorized bank account. If a Shareholder is unable
to contact the Funds by telephone, a Shareholder may also mail the redemption
request to the Distributor at the address above.

PAYMENTS TO SHAREHOLDERS

Redemption orders are effected at the net asset value per Share next
determined after the Class Q Shares are properly tendered for redemption, as
described above. Payment to Shareholders for Class Q Shares redeemed will be
made within seven days after receipt of the request for redemption, or within
such shorter period as required by law. To the greatest extent possible,
requests from Shareholders of Class Q Shares for next Business Day payments upon
redemption of Shares will be honored if received in good form by the Distributor
before 11:30 a.m. Pacific Time on a Business Day or, if received after the 11:30
a.m. Pacific Time, within two Business Days, unless it would be disadvantageous
to that Fund or its Shareholders to sell or liquidate portfolio securities in an
amount sufficient to satisfy requests for payments in that manner.

At various times, the Trust may be requested to redeem Class Q Shares for
which it has not yet received good payment. In such circumstances, the
forwarding of proceeds may be delayed until payment has been collected for the
purchase of such Class Q Shares, which delay may be for 15 days or more. Such
delay may be avoided if Class Q Shares are purchased by wire transfer of federal
funds. The Trust intends to pay cash for all Class Q Shares redeemed, but under
abnormal conditions which make payment in cash unwise, payment may be made
wholly or partly in portfolio securities at their then market value equal to the
redemption price. In such cases, an investor may incur brokerage costs in
converting such securities to cash.

See "ADDITIONAL PURCHASE AND REDEMPTION INFORMATION--Matters Affecting
Redemption" and "NET ASSET VALUE" in the Statement of Additional Information for
examples of when the Trust may suspend the right of redemption or redeem Shares
involuntarily.

MANAGEMENT OF THE FUNDS

TRUSTEES

Overall responsibility for management of the Funds rests with the Trustees of
the Trust, who are elected by the Shareholders of the Trust. The Trust will be
managed by the Trustees in accordance with the laws of the Commonwealth of
Massachusetts governing business trusts. There are currently six Trustees, three
of whom are not "interested persons" of the Trust within the

19
<PAGE>
meaning of that term under the 1940 Act. The Trustees, in turn, elect the
officers of the Trust to supervise actively its day-to-day operations. The
Trustees of the Trust are: George R. Landreth, David F. Jones, John W. Judy,
Raymond H. Lung, Mary Anne Houlahan and David B. Frohnmayer.

INVESTMENT ADVISER

Qualivest Capital Management, Inc., 111 S.W. Fifth Avenue, Portland, Oregon
97204, is the investment adviser of the Trust. Qualivest, a registered
investment adviser, is a wholly owned subsidiary of U.S. Bank, which is a wholly
owned subsidiary of U.S. Bancorp. U.S. Bancorp is a super-regional financial
services holding company organized under the laws of Oregon in 1968. U.S. Bank,
headquartered in Portland, is a national banking association, chartered in 1891.
It offers a wide variety of full-service and commercial banking operations in
over 200 locations in Oregon. Other services of U.S. Bancorp and its
subsidiaries include mortgage banking, lease financing, consumer financing,
commercial finance, international banking, investment advisory, insurance agency
and credit life insurance services, brokerage and venture capital. As of July
31, 1995, Qualivest had under management nearly $6.5 billion in assets. It also
is investment adviser to Tax-Free Trust of Oregon, a tax-free municipal bond
fund, whose assets were approximately $310 million at that date.

Subject to the general supervision of the Trust's Board of Trustees and in
accordance with the investment objective, policies and restrictions of each
Fund, Qualivest manages the Funds, makes decisions with respect to and places
orders for all purchases and sales of their portfolio securities, and maintains
each Fund's records relating to such purchases and sales.

ADMINISTRATOR AND DISTRIBUTOR

BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035, a division
of BISYS Group, Inc., is the administrator for each Fund, as well as the other
funds in the Trust, and also acts as the Trust's principal underwriter and
distributor.

The Administrator generally assists in all aspects of the Funds'
administration and operation. For expenses assumed and services provided as
administrator pursuant to its Management and Administration Agreement with the
Trust, BISYS receives a fee from each Fund equal to the lesser of a fee,
computed daily and paid periodically, at an annual rate of 0.13% of such Fund's
average daily net assets, or such other fee as may be agreed upon from time to
time by the Trust and the Administrator. The Administrator may periodically
voluntarily reduce all or a portion of its administrative fee with respect to
any Fund to increase the net income of such Fund available for distribution as
dividends. The voluntary fee reduction will cause the yield of that Fund to be
higher than it would otherwise be in the absence of such a reduction.

The Distributor acts as agent for the Funds in the distribution of their
Shares and, in such capacity, solicits orders for the sale of Shares,
advertises, and pays the cost of advertising, office space and its personnel
involved in such activities. Under its Distribution Agreement with the Trust,
the Distributor may receive compensation under the Class Q Distribution and
Shareholder Service Plan in connection with the sale by it of Class Q Shares.

20
<PAGE>
OTHER SERVICE PROVIDERS

BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-3035,
serves as the Trust's transfer agent and dividend disbursing agent pursuant to a
Transfer Agency Agreement with the Trust and receives a fee for such services.
BISYS Fund Services Ohio, Inc. also provides certain accounting services for
each of the Funds and receives a fee for such services. Deloitte & Touche LLP
serves as independent auditors for the Trust. United States National Bank of
Oregon is the Funds' custodian. See "MANAGEMENT OF THE TRUST" in the Statement
of Additional Information for further information.

While BISYS Fund Services Ohio, Inc. is a distinct legal entity from BISYS
(the Trust's administrator and distributor), BISYS Fund Services Ohio, Inc. is
considered to be an affiliated person of BISYS under the 1940 Act due to, among
other things, the fact that BISYS Fund Services Ohio, Inc. is owned by
substantially the same persons that directly or indirectly own BISYS.

EXPENSES

Qualivest and the Administrator each bear all expenses in connection with the
performance of its services as investment adviser and administrator,
respectively, other than the cost of securities (including brokerage
commissions, if any) purchased for a Fund. The ratios of operating expenses to
average daily net assets of the Class Q Shares for the period ended July 31,
1995 were as follows: U.S. Treasury Fund--0.61%; Money Market Fund--0.54%; and
Tax-Free Money Market Fund--0.85%.

As a general matter, expenses are allocated to the Class A Shares, Class Q
Shares and Class Y Shares of a Fund on the basis of the relative net asset value
of each class. At present, the only expenses that will be borne solely by Class
Q Shares, other than in accordance with the relative net asset value of the
class, are expenses under the Trust's Class Q Distribution and Shareholder
Service Plan, which relates only to the Class Q Shares.

The Trustees reserve the right, subject to the receipt of relevant regulatory
approvals or rulings, if needed, to allocate certain other expenses to the
Shareholders of a particular class, including Class Q Shares, on a basis other
than relative net asset value, as they deem appropriate ("Class Expenses"). In
such event, Class Expenses would be limited to: transfer agency fees identified
by the Transfer Agent as attributable to a specific class; printing and postage
expenses related to preparing and distributing materials such as Shareholder
reports, prospectuses and proxies to current Shareholders; Blue Sky registration
fees incurred by a class of Shares; Securities and Exchange Commission fees
incurred by a class of Shares; expenses related to administrative personnel and
services as required to support the Shareholders of a specific class; litigation
or other legal expenses relating solely to one class of Shares; and Trustees'
fees incurred as a result of issues relating solely to one class of Shares.

PORTFOLIO TRANSACTIONS

BANKING LAWS

Federal banking laws and regulations presently prohibit a national bank or any
affiliate thereof from sponsoring, organizing or controlling a registered
open-end investment company

21
<PAGE>
continuously engaged in the issuance of its shares, and generally from
underwriting, selling or distributing securities, such as Shares of the Funds.

DISTRIBUTION PLAN

Pursuant to Rule 12b-1 under the 1940 Act, the Trust has adopted a
Distribution and Shareholder Service Plan (the "Plan") with respect to the Class
Q Shares of each Fund. Pursuant to the Plan, each Fund is authorized to pay or
reimburse BISYS, as Distributor of the Class Q Shares of the Fund, for certain
expenses that are incurred in connection with Shareholder and distribution
services. Payments under the Plan will be calculated daily and paid monthly at
an annual rate not to exceed 0.25% of the average daily net assets of Class Q
Shares. As authorized by the Plan, BISYS has entered into a Rule 12b-1 Agreement
with U.S. Bancorp Securities, Inc. ("USBS"), an affiliate of Qualivest, pursuant
to which USBS has agreed to provide certain Shareholder and distribution
services in connection with Class Q Shares of the Funds purchased and held by
USBS for the accounts of its customers and Class Q Shares of the Funds purchased
and held by customers of USBS directly. BISYS will be compensated by the Funds
in an amount equal to its payments to USBS under the Rule 12b-1 Agreement. Such
fee may exceed the actual costs incurred by USBS in providing such services.

Payments under the Plan may be used by BISYS to pay banks and their affiliates
(including U.S. Bank and its affiliates), and other institutions, including
broker-dealers (each a "Participating Organization"), for administration,
distribution, and/or Shareholder service assistance pursuant to an agreement
between BISYS and the Participating Organization. Pursuant to the Plan, the
Distributor may enter into Rule 12b-1 Agreements with Participating
Organizations for providing Shareholder and distribution services to their
customers who are the record or beneficial owners of Class Q Shares. Such
Participating Organizations will be compensated at an annual rate of up to 0.25%
of the average daily net assets of the Class Q Shares held of record or
beneficially by such customers. Under the Plan, a Participating Organization may
include BISYS, its subsidiaries, and its affiliates.

Payments to the Distributor pursuant to the Plan will be used (i) to
compensate Participating Organizations for providing distribution assistance
relating to Class Q Shares, (ii) for promotional activities intended to result
in the sale of Class Q Shares, such as to pay for the preparation, printing and
distribution of prospectuses to other than current Shareholders, and (iii) to
compensate Participating Organizations for providing Shareholder services with
respect to their Customers who are, from time to time, beneficial and record
holders of Class Q Shares.

22
<PAGE>
Fees paid pursuant to the Plan are accrued daily and paid monthly, and are
charged as expenses of Class Q Shares of a Fund as accrued.

GENERAL INFORMATION

The Plan may be terminated by a vote of a majority of the Trustees who are not
"interested persons" (as defined in the 1940 Act) of the Trust and who have no
direct or indirect financial interest in the operation of the Plan or in any
agreements related to the Plan ("Independent Trustees"), or by a vote of a
majority of the holders of Class Q Shares. Any change in the Plan that would
increase materially the distribution expenses paid by a Fund requires
Shareholder approval; otherwise, the Plan may be amended by the Trustees,
including a majority of the Independent Trustees, by a vote cast in person at a
meeting called for the purpose of voting upon the amendment. As long as the Plan
is in effect, the selection or nomination of the Independent Trustees is
committed to the discretion of the Independent Trustees.

DIVIDENDS AND TAXES

The net income, excluding short-term capital gains, of each Fund is declared
daily as a dividend to Shareholders of such Fund at the close of business on the
day of declaration. Share prices on the day following declaration of a dividend
will reflect deduction of the dividend. Dividends consisting of short-term
capital gains are declared from time to time as may be appropriate. Dividends
are paid monthly. A Shareholder will automatically receive all income dividends
and capital gains distributions in additional full and fractional Shares at net
asset value as of the date of declaration, unless the Shareholder elects to
receive dividends or distributions in cash. Such election, or any revocation
thereof, must be made in writing to the Transfer Agent at 3435 Stelzer Road,
Columbus, Ohio 43219-3035, and will become effective with respect to dividends
and distributions having record dates after its receipt by the Transfer Agent.

FEDERAL TAXES

Each Fund intends to qualify annually and elect to be treated as a regulated
investment company under the Internal Revenue Code of 1986, as amended (the
"Code"), so that it generally will not be subject to federal income tax on its
taxable income and gains that are distributed to Shareholders. In order to avoid
a 4% federal excise tax, each Fund intends to distribute each calendar year
substantially all of its taxable income and gains.

23
<PAGE>
minimum tax liability of a corporation, the entire amount of exempt-interest
dividends will be part of an adjustment in computing alternative minimum taxable
income and will have to be taken into account for purposes of the environmental
tax under Code section 59A. Exempt-interest dividends are includable in the tax
base for determining the extent to which social security or railroad retirement
benefits will be subject to federal income tax. The Tax-Free Money Market Fund
may derive taxable investment income and realize capital gains or losses from
portfolio transactions, including the sale of securities; distributions to
Shareholders derived from such income and gains will be taxable to the
Shareholders. Deductions for interest expense incurred (or deemed to be
incurred) to acquire or carry Shares of the Tax-Free Money Market Fund may be
subject to limitations that reduce or eliminate such deductions.

Shareholders will be furnished annually with information relating to the
nature and amounts of distributions made by a Fund.

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<PAGE>
GENERAL INFORMATION

ORGANIZATION OF THE TRUST

The Trust was organized as a Massachusetts business trust in 1994 and consists
of eleven funds. The Shares of all of the funds of the Trust, other than the
U.S. Treasury, Money Market and Tax-Free Money Market Funds, are offered in
three separate classes: Class A Shares, Class C Shares and Class Y Shares.
Shares of each of the U.S. Treasury, Money Market and Tax-Free Money Market
Funds are also offered in three separate classes: Class A Shares, Class Q Shares
and Class Y Shares. Each Share represents an equal proportionate interest in a
Fund with other Shares of the same Fund, and is entitled to such dividends and
distributions out of the income earned on the assets belonging to that Fund as
are declared at the discretion of the Trustees. Shares are without par value.
Shareholders are entitled to one vote for each dollar of value invested, and a
proportionate fractional vote for any fraction of a dollar invested, and will
vote in the aggregate and not by fund except as otherwise expressly required by
law.

An annual or special meeting of Shareholders to conduct necessary business is
not required by the Trust's Declaration of Trust, the 1940 Act or other
authority except, under certain circumstances, to elect Trustees, amend the
Declaration of Trust, approve an investment advisory agreement and satisfy
certain other requirements. To the extent that such a meeting is not required,
the Trust may elect not to have an annual or special meeting.

MULTIPLE CLASSES OF SHARES

In addition to Class Q Shares, the Trust also offers Class A and Class Y
Shares of each of the Funds. Class A Shares are offered to the general public,
while Class Y Shares are sold through procedures established by the Distributor
only to certain institutional investors and to bank trust departments purchasing
Shares on behalf of fiduciary, advisory, agency, custody or other similar
accounts maintained by, or on behalf of, their customers. Class A Shares are not
sold subject to a sales change and bear expenses of up to 0.40% of the average
daily net assets of the Class A Shares under a Plan pertaining to Class A
Shares. Class Y Shares are not sold subject to a sales load and do not bear
expenses under the Plans pertaining to Class A and Class Q Shares. In addition,
Class A Shares may bear additional retail transfer agency expenses not
applicable to Class Q and Class Y Shares. A salesperson or other person entitled
to receive compensation for selling or servicing the Shares may receive
different compensation with respect to one particular class of Shares over
another in the same Fund. For further details regarding eligibility requirements
for the purchase of Class A and Class Y Shares, call the Trust at
1-800-743-8637.

The amount of dividends payable with respect to Class Y Shares will exceed
dividends on Class Q Shares as a result of the Plan fee applicable to Class Q
Shares. The amount of dividends payable with respect to Class Y Shares and Class
Q Shares will exceed dividends on Class A Shares as a result of the Plan fee
applicable to Class A Shares and because Class A Shares may bear additional
retail transfer agency expenses.

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<PAGE>
Each Fund intends to seek a ruling from the IRS to the effect that differing
distributions among the classes of its Shares will not result in the Fund's
dividends or other distributions being regarded as "preferential dividends"
under the Code. While similar rulings have been issued by the IRS, complete
assurance cannot, of course, be given that the Funds will receive such rulings.
For additional information, including a discussion of the consequences were the
IRS to decline to grant the requested rulings, see the Statement of Additional
Information.

PERFORMANCE INFORMATION

Standardized yield and total return quotations will be computed separately for
Class A, Class Q and Class Y Shares. Because of differences in the fees and/or
expenses borne by Class A, Class Q and Class Y Shares of the Funds, the net
yield and total return on Class A Shares can be expected, at any given time, to
be lower than the net yield and total return on Class Q and Class Y Shares for
the same period, and the net yield and total return on Class Q Shares of the
Funds can be expected to be lower than the net yield and total return on Class Y
Shares for the same period.

Total return and yield are functions of the type and quality of instruments
held in the portfolio, operating expenses, and market conditions. Any fees
charged with respect to customer accounts for investing in Shares of the Funds
will not be included in performance calculations; such fees, if charged, will
reduce the actual performance from that quoted. In addition, if Qualivest and
BISYS voluntarily reduce all or part of their respective fees, the total return
of such Fund will be higher than it would otherwise be in the absence of such
voluntary fee reductions.

ACCOUNT SERVICES

Shareholders of the Trust may obtain current price, yield and other
performance information on any of the Funds or any of the Trust's funds 24 hours
a day by calling 1-800-743-8637 from any touch-tone telephone.

MISCELLANEOUS

26
<PAGE>
No person has been authorized to give any information or to make any
representations not contained in this Prospectus 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 by the Distributor in any jurisdiction in which such offering may not
lawfully be made.

27
<PAGE>

THE QUALIVEST FUNDS:

BROUGHT TO YOU BY U.S. BANK'S TRUST AND INVESTMENT MANAGEMENT DIVISION

Competitive yields, local investment management--U.S. Bank's
Trust and Investment Management Division is proud to offer the
Qualivest Funds as a part of its full range of trust services.

The strength of these mutual funds is based on the exceptional
local management provided by our affiliate, Qualivest Capital
Management, Inc., and the strength of trust services that
individuals and corporations have come to count on is provided
by U.S. Bank's Trust and Investment Management Division, a
Northwest leader in comprehensive estate planning, investment
management and custodial services for more than 75 years.

Any and all of the Division's trust services include the
expertise of specialized teams, which bring a unique
concentration of insight and attention to our corporate clients,
foundations and other organizations, as well as high net worth
individuals.

QUALIVEST CAPITAL MANAGEMENT, INC.:

THE PEOPLE BEHIND THE PERFORMANCE

The Qualivest Funds are designed to provide individual and
institutional investors with the best of both worlds: nationally
recognized expertise delivered with a local management
perspective.

Your investment in the Qualivest Funds benefits from the
experience of the professionals at Qualivest Capital Management,
Inc., a Northwest-based investment management firm that combines
the advantages of institutional size and strength with the
entrepreneurship of a private investment counselor.

Qualivest Fund investors are in good company; Qualivest Capital
Management, Inc. invests and manages over $6.5 billion for a
client base that includes 401(k) plans, pension and
profit-sharing plans, corporations, foundations and private
individuals.

<PAGE>
QUALIVEST
FUNDS

CLASS Y SHARES

<TABLE>
<S> <C>
INVESTMENT ADVISER LEGAL COUNSEL
Qualivest Capital Management, Inc. Dechert Price & Rhoads
P.O. Box 2758 1500 K Street, N.W.
Portland, Oregon 97208 Washington, D.C. 20005-1208

ADMINISTRATOR & DISTRIBUTOR AUDITORS
BISYS Fund Services Deloitte & Touche LLP
3435 Stelzer Road 1700 Courthouse Plaza Northeast
Columbus, Ohio 43219-3035 Dayton, Ohio 45402
</TABLE>

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary............................................... 3
Fund Expenses.................................................... 6
Fee Tables....................................................... 7
Selected Financial Information................................... 11
Investment Objectives and Policies............................... 14
Investment Techniques and Risk Factors........................... 24
Valuation of Shares.............................................. 34
Purchasing Shares................................................ 34
Redeeming Shares................................................. 35
Management of the Funds.......................................... 37
Dividends and Taxes.............................................. 41
General Information.............................................. 43
</TABLE>

PROSPECTUS DATED NOVEMBER 15, 1995

3435 Stelzer Road
Columbus, Ohio
43219 1-800-743-8637

- Qualivest U.S. Treasury Money Market Fund;
- Qualivest Money Market Fund;
- Qualivest Tax-Free Money Market Fund;
- Qualivest Tax-Free National Bond Fund;
- Qualivest Intermediate Bond Fund;
- Qualivest Diversified Bond Fund;
- Qualivest Optimized Stock Fund;
- Qualivest Income Equity Value Fund;
- Qualivest Large Companies Value Fund;
- Qualivest International Opportunities Fund; and
- Qualivest Small Companies Value Fund.

Shares of the Qualivest Income Equity Value Fund and the Qualivest Tax-Free
National Bond Fund are not currently being offered.

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"), acts as
the investment adviser to each of the Funds.

Additional information about the Trust and each of the Funds, contained in a
Statement of Additional Information dated November 15, 1995, has been filed with
the Securities and Exchange Commission and is available upon request without
charge by writing to the Trust at its address or by calling the Trust at the
telephone number shown above.

Continued on next page

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

The date of this Prospectus is November 15, 1995.
<PAGE>
The Trustees of the Trust have divided beneficial ownership of each Fund
into transferable units called shares (the "Shares"). Each Fund offers multiple
classes of Shares. This Prospectus describes one class of Shares of each
Fund--the Class Y Shares. Class Y Shares of the Funds are currently offered only
through trust departments of banks and other institutional investors (including
other mutual funds distributed by the BISYS Group, Inc. and its affiliated
companies) with account balances of $1,000,000 or more that have entered into a
separate agreement with the Funds' distributor for monies that are held in a
fiduciary, advisory, agency, custodial, or similar capacity. Each of the Funds
also offers Class A Shares to the general public; the Qualivest Large Companies
Value Fund, Qualivest Small Companies Value Fund, Qualivest Income Equity Value
Fund, Qualivest International Opportunities Fund, Qualivest Optimized Stock
Fund, Qualivest Intermediate Bond Fund, Qualivest Diversified Bond Fund and
Qualivest Tax-Free National Bond Fund offer Class C Shares to the public; and
the Qualivest U.S. Treasury Money Market Fund, Qualivest Money Market Fund and
Qualivest Tax-Free Money Market Fund offer a class of Shares known as Class Q
Shares to corporate investors. These classes of Shares differ from each other,
and from the Class Y Shares, principally with respect to sales charges and the
rate of expenses to which they are subject. Interested persons who wish to
obtain a copy of the Prospectus of the Class A, Class C or Class Q Shares of the
Funds may contact the Trust at the telephone number shown above.

2
<PAGE>
PROSPECTUS SUMMARY

<TABLE>
<S> <C>
Shares Offered........................ Class Y Shares of the Qualivest Large Companies
Value Fund (the "Large Companies Fund"), the
Qualivest Small Companies Value Fund (the "Small
Companies Fund"), the Qualivest Income Equity
Value Fund (the "Income Equity Fund"), the
Qualivest International Opportunities Fund (the
"International Fund") and the Qualivest Optimized
Stock Fund (the "Optimized Fund") (collectively,
the "Equity Funds"); the Qualivest Intermediate
Bond Fund (the "Intermediate Bond Fund"), the
Qualivest Diversified Bond Fund (the "Bond Fund")
and the Qualivest Tax-Free National Bond Fund
(the "Tax-Free Bond Fund") (collectively, the
"Income Funds"); and the Qualivest U.S. Treasury
Money Market Fund (the "U.S. Treasury Fund"), the
Qualivest Money Market Fund (the "Money Market
Fund") and the Qualivest Tax-Free Money Market
Fund (the "Tax-Free Money Market Fund")
(collectively, the "Money Funds" and, with the
Equity and Income Funds, the "Funds"), which are
eleven separate diversified investment portfolios
("funds") of Qualivest Funds, a Massachusetts
business trust (the "Trust") which is registered
as an open- end management investment company.

Offering Price and Sales Charges...... The public offering price of Class Y Shares of each
Equity and Income Fund is equal to the net asset
value per Share with no sales charge and no
contingent deferred sales charge ("CDSC") imposed
on redemptions. The public offering price of each
Money Fund is equal to the net asset value per
Share, which the Trust will seek to maintain at
$1.00, with no sales charge or CDSC. Class Y
Shares are offered only through trust departments
of banks and other institutional investors for
monies that are held in a fiduciary, agency,
custodial, or similar capacity.

Investment Objectives

Large Companies Fund.............. The Large Companies Fund seeks long-term capital
appreciation.

Small Companies Fund.............. The Small Companies Fund seeks capital
appreciation.

Income Equity Fund................ The Income Equity Fund seeks a level of total
return consistent with investing in a portfolio
that consists primarily of high quality
dividend-paying common stocks and securities
convertible into common stocks.
</TABLE>

3
<PAGE>

<TABLE>
<S> <C>
International Fund................ The International Fund seeks capital appreciation.

Optimized Fund.................... The Optimized Fund seeks capital appreciation and
current income.

Intermediate Bond Fund............ The Intermediate Bond Fund seeks current income
consistent with preservation of capital.

Bond Fund......................... The Bond Fund seeks current income consistent with
preservation of capital.

Tax-Free Bond Fund................ The Tax-Free Bond Fund seeks current income, free
from federal income tax, consistent with
preservation of capital.

U.S. Treasury Fund and Money
Market Fund..................... The U.S. Treasury Fund and the Money Market Fund
seek current income consistent with liquidity and
stability of principal.

Tax-Free Money Market Fund........ The Tax-Free Money Market Fund seeks current
income, free from federal income tax, consistent
with liquidity and stability of principal.

Investment Policies

Large Companies Fund.............. Under normal market conditions, the Large Compa-
nies Fund will invest at least 65% of its total
assets in common stocks and securities
convertible into common stocks of companies with
a market capitalization of at least $1 billion at
the time of purchase; income and payment of
dividends is a consideration in selecting
investments.

Small Companies Fund.............. Under normal market conditions, the Small Compa-
nies Fund will invest at least 65% of its total
assets in common stocks and securities
convertible into common stocks of companies with
a market capitalization of less than $1 billion
at the time of purchase.

Income Equity Fund................ Under normal market conditions, the Income Equity
Fund will invest at least 65% of its total assets
in common stocks and securities convertible into
common stocks of companies believed by the
investment adviser to be characterized by sound
management, the ability to pay above average
dividends and the potential for growth of capital
and dividends.

International Fund................ Under normal market conditions, the International
Fund will invest at least 80% of its total assets
in common stocks and securities convertible into
common
</TABLE>

4
<PAGE>

<TABLE>
<S> <C>
stocks of companies that are organized under the
laws of at least three countries other than the
U.S. and whose securities are listed on the
Morgan Stanley Capital International EAFE
(Europe, Australasia, Far East) Index (the "EAFE
Index"), or in securities issued by large-sized
U.S. companies with substantial business
activities abroad.

Tax-Free Bond Fund................ Under normal market conditions, the Tax-Free Bond
Fund will invest at least 65% of its total assets
in bonds. Under normal market conditions and as a
fundamental policy, at least 80% of the net
assets of the Tax-Free Bond Fund will be invested
in a diversified portfolio of obligations the
interest on which is both exempt from federal
income tax and not treated as a preference item
for individuals for purposes of the federal
alternative minimum tax.

Money Market Fund................. Under normal market conditions, the Money Market
Fund will invest in high quality (i.e., rated
within the
</TABLE>

5
<PAGE>

<TABLE>
<S> <C>
top two rating categories by a nationally
recognized statistical rating organization
("NRSRO")) money market instruments and other
comparable investments.

Tax-Free Money Market Fund........ Under normal market conditions, the Tax-Free Money
Market Fund will invest at least 80% of its net
assets in short-term money market obligations the
interest on which is both exempt from federal
income tax and not treated as a preference item
for individuals for purposes of the federal
alternative minimum tax.
Risk Factors and Special
Considerations...................... An investment in the Funds involves a certain
amount of risk and may not be suitable for all
investors. See "INVESTMENT TECHNIQUES AND RISK
FACTORS."
Investment Adviser.................... Qualivest Capital Management, Inc. ("Qualivest"),
Portland, Oregon, a subsidiary of the United
States National Bank of Oregon ("U.S. Bank"),
serves as investment adviser to each Fund. See
"MANAGEMENT OF THE FUNDS--Investment Adviser."
Dividends and Capital Gains........... Dividends from net income are declared and paid
quarterly for the Equity Funds and monthly for the
Income Funds. Net realized capital gains are
distributed at least annually. For the Money
Funds, dividends from net income, excluding
short-term capital gains, are declared daily and
paid monthly, while dividends from short-term
capital gains, if any, are declared and paid as
deemed appropriate.
Other Information..................... U.S. Bank and The Bank of New York (each a "Custo-
dian") are the Trust's custodians. BISYS Fund
Services ("BISYS" or "Distributor" or
"Administrator") serves as the distributor and
administrator of the Funds. BISYS Fund Services
Ohio, Inc. ("Transfer Agent") serves as the
transfer agent and dividend disbursing agent and
provides certain accounting services for the
Trust.
</TABLE>

FUND EXPENSES

The following expense tables indicate costs and expenses that an investor
should anticipate incurring either directly or indirectly as a Shareholder of a
Fund.

6
<PAGE>
FEE TABLES

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST
LARGE COMPANIES SMALL COMPANIES INCOME EQUITY
VALUE FUND VALUE FUND VALUE FUND
--------------- --------------- -----------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on
Purchases (as a percentage of
offering price).................... None None None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price)...... None None None
Deferred Sales Charge (as a
percentage of redemption proceeds). None None None
Redemption Fees (as a percentage of
redemption proceeds)............... None None None
Exchange Fees........................ None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets
annualized)
Management Fees After Waiver1........ 0.60% 0.80% 0.00%
12b-1 Fees........................... None None None
Other Expenses....................... 0.34% 0.31% 0.52%
----- ----- -----
Total Fund Operating Expenses After
Waiver2............................ 0.94% 1.11% 0.52%
----- ----- -----
----- ----- -----
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
INTERNATIONAL OPTIMIZED
OPPORTUNITIES FUND STOCK FUND
----------------------- -------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES

Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price)............... None None
Maximum Sales Charge Imposed on Reinvested Dividends
(as a percentage of offering price)............... None None
Deferred Sales Charge (as a percentage of
redemption proceeds).............................. None None
Redemption Fees (as a percentage of
redemption proceeds).............................. None None
Exchange Fees....................................... None None
</TABLE>

7
<PAGE>
<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
INTERNATIONAL OPTIMIZED
OPPORTUNITIES FUND STOCK FUND
----------------------- -------------------
<S> <C> <C>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets annualized)

Management Fees After Waiver1....................... 0.30% 0.30%
12b-1 Fees.......................................... None None
Other Expenses...................................... 0.51% 0.31%
----- -----
Total Fund Operating Expenses After Waiver2......... 0.81% 0.61%
----- -----
----- -----
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST TAX-FREE
INTERMEDIATE DIVERSIFIED NATIONAL
BOND FUND BOND FUND BOND FUND
---------------------- --------------------- ------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on
Purchases (as a percentage of
offering price)................... None None None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price)..... None None None
Deferred Sales Charge (as a
percentage of redemption proceeds) None None None
Redemption Fees (as a percentage of
redemption proceeds).............. None None None
Exchange Fees....................... None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets
annualized)
Management Fees After Waiver1....... 0.45% 0.30% 0.00%
12b-1 Fees.......................... None None None
Other Expenses...................... 0.29% 0.32% 0.78%
----- ----- -----
Total Fund Operating Expenses After
Waiver2........................... 0.74% 0.62% 0.78%
----- ----- -----
----- ----- -----
</TABLE>

8
<PAGE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST
U.S. TREASURY MONEY MARKET TAX-FREE MONEY
MONEY MARKET FUND FUND MARKET FUND
----------------- ------------ ------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on
Purchases (as a percentage of offering
price)................................ None None None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a percentage
of offering price).................... None None None
Deferred Sales Charge (as a percentage
of
redemption proceeds).................. None None None
Redemption Fees (as a percentage of
redemption proceeds).................. None None None
Exchange Fees........................... None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets
annualized)
Management Fees After Waiver1........... 0.00% 0.25% 0.00%
12b-1 Fees.............................. None None None
Other Expenses.......................... 0.32% 0.27% 0.55%
----- ----- -----
Total Fund Operating Expenses After
Waiver2............................... 0.32% 0.52% 0.55%
----- ----- -----
----- ----- -----
</TABLE>

- ------

1 Qualivest has agreed to temporarily waive a portion of its investment advisory
fee for some of the Funds for the current fiscal year. Waived fees cannot be
recovered at a future date. Absent the advisory fee waiver, "Management Fees"
as a percentage of average daily net assets would be 0.75% for the Large
Companies Fund, 0.60% for each of the Income Equity Fund, the International
Fund, the Intermediate Bond Fund and the Bond Fund, 0.50% for each of the
Tax-Free Bond Fund and the Optimized Fund, and 0.35% for each of the Money
Funds. See "MANAGEMENT OF THE FUNDS--Investment Adviser."

2 Absent the waiver of the investment advisory fee, "Total Fund Operating
Expenses" as a percentage of average daily net assets would be 1.09% for the
Large Companies Fund, 1.12% for the Income Equity Fund, 1.11% for the
International Fund, 0.81% for the Optimized Fund, 0.89% for the Intermediate
Bond Fund, 0.92% for the Bond Fund, 1.28% for the Tax-Free Bond Fund, 0.67%
for the U.S. Treasury Fund, 0.62% for the Money Market Fund and 0.90% for the
Tax-Free Money Market Fund.

9
<PAGE>
EXAMPLES*

An investor would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return, and (2) redemption at the end of each time
period:

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST
LARGE COMPANIES SMALL COMPANIES INCOME EQUITY
VALUE FUND VALUE FUND VALUE FUND
--------------- --------------------- -----------------
<S> <C> <C> <C>
1 Year................................. $ 10 $ 11 $ 5
3 Years................................ $ 30 $ 35 $17
5 Years................................ $ 52 $ 61 $29
10 Years............................... $ 115 $ 135 $65
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST
INTERNATIONAL OPTIMIZED
OPPORTUNITIES FUND STOCK FUND
---------------------- -----------------
<S> <C> <C> <C>
1 Year............................. $ 8 $ 6
3 Years............................ $ 26 $20
5 Years............................ $ 45 $34
10 Years........................... $100 $76
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST TAX-FREE
INTERMEDIATE DIVERSIFIED NATIONAL
BOND FUND BOND FUND BOND FUND
---------------------- --------------------- ------------------
<S> <C> <C> <C>
1 Year............................. $ 8 $ 6 $ 8
3 Years............................ $ 24 $20 $ 25
5 Years............................ $ 41 $34 $ 43
10 Years........................... $ 92 $76 $ 97
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST QUALIVEST QUALIVEST
U.S. TREASURY MONEY MARKET TAX-FREE MONEY
MONEY MARKET FUND FUND MARKET FUND
---------------------- --------------------- -----------------
<S> <C> <C> <C>
1 Year............................. $ 3 $ 5 $ 6
3 Years............................ $ 10 $17 $18
5 Years............................ $ 18 $29 $31
10 Years........................... $ 41 $65 $69
</TABLE>

- ------

* These examples should not be considered representations of future expenses,
which may be more than those shown. The assumed 5% annual return is
hypothetical and should not be considered a representation of past or future
annual return. Actual return may be greater or less than the assumed amount.

10
<PAGE>
SELECTED FINANCIAL INFORMATION

The following tables of selected financial information are included to
assist Shareholders in evaluating the performance of the Funds since their
commencements of operations through July 31, 1995. The information set forth in
these tables has been audited by Deloitte & Touche LLP, the Trust's independent
auditors, whose report on the Funds' financial statements is included in Funds'
Annual Report, which may be obtained without charge, and is incorporated by
reference in the Funds' Statement of Additional Information. The Annual Report
also includes Management's Discussion of Fund Performance. This information
should be read in conjunction with the financial statements.

<TABLE>
<CAPTION>
QUALIVEST LARGE QUALIVEST SMALL
COMPANIES VALUE FUND COMPANIES VALUE FUND
AUGUST 1, 1994 TO AUGUST 1, 1994 TO
JULY 31, 1995(A) JULY 31, 1995(A)
-------------------- --------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD.................. $ 10.00 $ 10.00
-------- ----------
INVESTMENT ACTIVITIES
Net investment income............................. 0.24 0.13
Net realized and unrealized gains on
investments..................................... 2.22 3.30
-------- ----------
Total from Investment Activities.............. 2.46 3.43
-------- ----------
DISTRIBUTIONS
Net investment income............................. (0.20) (0.12)
Net realized gains................................ (0.03) (0.05)
-------- ----------
Total Distributions........................... (0.23) (0.17)
-------- ----------
NET ASSET VALUE, END OF PERIOD........................ $ 12.23 $ 13.26
-------- ----------
-------- ----------
TOTAL RETURN--EXCLUDING SALES LOAD.................... 25.04% 34.76%

RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000)................. $ 98,127 $209,626
Ratio of expenses to average net assets........... 0.53% 0.60%
Ratio of net investment income to average net
assets.......................................... 2.19% 1.20%
Ratio of expenses to average net assets*.......... 1.11% 1.12%
Ratio of net investment income to average net
assets*......................................... 1.61% 0.68%
Portfolio turnover rate(d)........................ 48% 37%
</TABLE>

11
<PAGE>

<TABLE>
<CAPTION>
QUALIVEST INTERNATIONAL QUALIVEST OPTIMIZED
OPPORTUNITIES FUND STOCK FUND
JULY 3, 1995 TO MAY 2, 1995 TO
JULY 31, 1995(A) JULY 31, 1995(B)
----------------------- -------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD.................... $ 10.00 $ 10.00
-------- ----------
INVESTMENT ACTIVITIES
Net investment income............................... 0.01 0.06
Net realized and unrealized gains on investments.... 0.47 0.91
-------- ----------
Total from Investment Activities................ 0.48 0.97
-------- ----------
DISTRIBUTIONS
Net investment income............................... 0.00 (0.02)
-------- ----------
NET ASSET VALUE, END OF PERIOD.......................... $ 10.48 $ 10.95
-------- ----------
-------- ----------
TOTAL RETURN--EXCLUDING SALES LOAD(B)................... 4.80% 9.74%
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000)................... $60,073 $ 148,782
Ratio of expenses to average net assets(c).......... 1.18% 0.68%
Ratio of net investment income to average net
assets(c)......................................... 1.32% 2.38%
Ratio of expenses to average net assets*(c)......... 1.39% 0.88%
Ratio of net investment income to average net
assets*(c)........................................ 1.12% 2.18%
Portfolio turnover rate(d).......................... 0% 5%
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST INTERMEDIATE QUALIVEST DIVERSIFIED
BOND FUND BOND FUND
AUGUST 1, 1994 TO MAY 2, 1995 TO
JULY 31, 1995(A) JULY 31, 1995(A)
---------------------- ---------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........... $ 10.00 $ 10.00
---------- --------
INVESTMENT ACTIVITIES
Net investment income...................... 0.64 0.15
Net realized and unrealized gains on
investments.............................. 0.14 0.31
---------- --------
Total from Investment Activities....... 0.78 0.46
---------- --------
DISTRIBUTIONS
Net investment income...................... (0.62) (0.13)
---------- --------
NET ASSET VALUE, END OF PERIOD................. $ 10.16 $ 10.33
---------- --------
---------- --------
TOTAL RETURN--EXCLUDING SALES LOAD............. 8.09% 4.58%(b)
</TABLE>

12
<PAGE>

<TABLE>
<CAPTION>
QUALIVEST INTERMEDIATE QUALIVEST DIVERSIFIED
BOND FUND BOND FUND
AUGUST 1, 1994 TO MAY 2, 1995 TO
JULY 31, 1995(A) JULY 31, 1995(A)
---------------------- ---------------------
<S> <C> <C>
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000).......... $141,399 $99,347
Ratio of expenses to average net assets.... 0.41% 0.70%(c)
Ratio of net investment income to average
net assets............................... 6.31% 5.91%(c)
Ratio of expenses to average net assets*... 0.91% 1.00%(c)
Ratio of net investment income to average
net assets*.............................. 5.81% 5.61%(c)
Portfolio turnover rate(d)................. 107% 34%
</TABLE>

<TABLE>
<CAPTION>
QUALIVEST
TAX-FREE
QUALIVEST U.S. TREASURY QUALIVEST MONEY MONEY MARKET FUND
MONEY MARKET FUND MARKET FUND JANUARY 9, 1995
JANUARY 11, 1995 TO AUGUST 1, 1995 TO TO
JULY 31, 1995(A) JULY 31, 1995(A) JULY 31, 1995(A)
----------------------- ----------------- -----------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD... $ 1.000 $ 1.000 $ 1.000
----------- ----------------- -----------------
INVESTMENT ACTIVITIES
Net investment income.............. 0.030 0.053 0.019
DISTRIBUTIONS
Net investment income.............. (0.030) (0.053) (0.019)
----------- ----------------- -----------------
NET ASSET VALUE, END OF PERIOD......... $ 1.000 $ 1.000 $ 1.000
----------- ----------------- -----------------
----------- ----------------- -----------------
TOTAL RETURN........................... 3.02%(b) 5.40% 1.88%(b)
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period
(000)............................ $ 14 $ 66,484 $ 14
Ratio of expenses to average net
assets........................... 0.40%(c) 0.38% 0.59%(c)
Ratio of net investment income to
average net assets............... 5.56%(c) 5.31% 3.38%(c)
Ratio of expenses to average net
assets*.......................... 0.75%(c) 0.67% 0.94%(c)
Ratio of net investment income to
average net assets*.............. 5.21%(c) 5.02% 3.03%(c)
</TABLE>

- ------

* During the period the investment advisory and custodian fees were voluntarily
reduced. If such voluntary fee reductions had not occurred, the ratios would
have been as indicated.

(a) Period from conmencement of operations.

(b) Not annualized.

(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing between the classes of Shares issued.

13
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES

GENERAL

The Income Equity Fund. The investment objective of the Income Equity Fund is
to seek a level of total return consistent with investing in a portfolio that
consists primarily of high quality dividend-paying common stocks and securities
convertible into common stocks. In selecting portfolio investments, high current
dividend yield is given more weight than the potential for capital appreciation
and growth of dividends. However, the Income Equity Fund may also invest in
other equity securities that pay current dividends but emphasize growth.

The Tax-Free Bond Fund. The investment objective of the Tax-Free Bond Fund is
to seek current income, free from federal income taxes, consistent with
preservation of capital. Under normal market conditions and as a fundamental
policy, at least 80% of the net assets of the Tax-Free Bond Fund will be
invested in debt obligations the interest on which is both exempt from federal
income tax and not treated as a preference item for individuals for purposes of
the federal alternative minimum tax.

14
<PAGE>
other money market instruments issued or guaranteed by the U.S. Government.

* * * *

The investment objective of each Fund is a fundamental policy and as such may
not be changed without a vote of the holders of a majority of the outstanding
Shares of that Fund. Other policies of a Fund may be changed without a vote of
the holders of a majority of outstanding Shares of that Fund unless (i) the
policy is expressly deemed to be a fundamental policy, or (ii) the policy is
expressly deemed to be changeable only by such majority vote. There can be no
assurance that the investment objective of any Fund will be achieved.

INVESTMENT POLICIES--EQUITY FUNDS

LARGE COMPANIES, SMALL COMPANIES, AND INCOME EQUITY FUNDS

15
<PAGE>
Companies Fund would no longer be primarily invested in common stocks and
securities convertible into common stocks issued by large capitalization
companies and small-sized companies, respectively.

Under normal market conditions, the Income Equity Fund will invest at least
65% of its total assets in common stocks and securities convertible into common
stocks of companies believed by Qualivest to be characterized by sound
management, the ability to pay above average dividends and the potential for
growth of capital and dividends.

Each of the Large Companies, Small Companies and Income Equity Funds may also
invest up to 35% of the value of its total assets in preferred stocks, corporate
bonds, notes, units of real estate investment trusts, asset-backed and
mortgage-related securities, warrants, and short-term obligations (with
maturities of 12 months or less) consisting of commercial paper (including
variable amount master demand notes), bankers' acceptances, certificates of
deposit, repurchase agreements, obligations issued or guaranteed by the U.S.
Government or its agencies or instrumentalities, and demand and time deposits of
domestic and foreign banks and savings and loan associations. Each of these
Funds may also hold securities of other investment companies and depositary or
custodial receipts representing beneficial interests in any of the foregoing
securities.

Each of these Funds may invest in corporate debt securities such as bonds and
notes which are rated at the time of purchase within the four highest rating
groups assigned by an NRSRO (e.g., in the case of Moody's Investors Service,
Inc. ("Moody's"), Aaa, Aa, A and Baa, and in the case of Standard & Poor's
Corporation ("S&P"), AAA, AA, A and BBB), which are considered to be investment
grade or, if unrated, which Qualivest deems to present attractive opportunities
and are of comparable quality. For a description of NRSROs and their rating
symbols, see the Appendix to the Statement of Additional Information. For a
discussion of debt securities rated within the fourth highest rating group
assigned by an NRSRO, see "INVESTMENT TECHNIQUES AND RISK FACTORS--Medium-Grade
Securities" herein.

INTERNATIONAL AND OPTIMIZED FUNDS

Under normal market conditions, at least 80% of the total assets of the
International Fund will be invested in common stocks and securities convertible
into common stocks of foreign companies whose securities are listed on the EAFE
Index. The International Fund will invest in the securities of issuers from at
least three countries other than the U.S. Investments are selected for inclusion
in the Fund's portfolio primarily on the basis of market capitalization and
industry weightings, and to create an aggregate country weighting

16
<PAGE>
similar to that of the EAFE Index. While Qualivest anticipates that
substantially all of the Fund's assets will be so invested, Qualivest may invest
up to 20% of the International Fund's total assets in common stocks and
securities convertible into common stocks of large capitalization U.S. companies
that Qualivest deems to present attractive investment opportunities due to such
companies' foreign business operations.

This Fund does not intend to mirror the performance of the S&P 500 Index;
rather, it seeks to optimize its investments in S&P 500 Index companies and
outperform the S&P 500 Index over time by investing in securities that, on the
basis of computerized modelling and performance optimization strategies
implemented by Qualivest, demonstrate attributes that indicate performance
superior to that of the S&P 500 Index as a whole. The S&P 500 Index is composed
of 500 common stocks chosen by S&P on a statistical basis to be included in the
index. Because of the market-value weighting, the largest companies in the S&P
500 Index typically account for a disproportionate share of the index. Qualivest
believes that an investment in securities of companies listed on the S&P 500
Index may be optimized by selecting those securities whose growth and value
characteristics indicate that their performance, relative to the other
securities listed on the S&P 500 Index, will exceed the extent to which the S&P
500 Index reflects their performance. Qualivest intends to utilize computer
modelling and other strategies to identify those stocks that, in light of its
assessment of general economic conditions, Qualivest believes will achieve
capital appreciation and current income superior to the performance of a
portfolio that merely seeks to replicate the S&P 500 Index.

* * * *

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ever, to the extent that an Equity Fund is so invested, its investment objective
may not be achieved during that time.

INVESTMENT POLICIES--INCOME FUNDS

INTERMEDIATE BOND AND BOND FUNDS

Under normal market conditions, at least 65% of the total assets of the
Intermediate Bond Fund and Bond Fund will be invested in bonds. Bonds in which
these Funds may invest can have maturities of up to thirty years or more. Each
of these Funds may invest up to 35% of its total assets in high quality money
market instruments such as commercial paper (including variable amount master
demand notes), certificates of deposit and bankers' acceptances, variable and
floating rate notes, and asset-backed securities without regard to maturity,
except as set forth below. In addition, these Funds may engage in certain loans
of portfolio securities, repurchase agreements and reverse repurchase
agreements, and may also invest in securities of other investment companies. The
Intermediate Bond Fund will maintain a dollar-weighted average maturity of three
to seven years under ordinary market conditions, while the Bond Fund will
maintain a dollar-weighted average maturity of approximately seven to eleven
years under ordinary market conditions.

Each of these Funds expects to invest in bonds, notes and debentures of a wide
range of U.S. corporate issuers. Such obligations, in the case of debentures,
will represent unsecured promises to pay, in the case of notes and bonds, may be
secured by mortgages on real property or security interests in personal property
and will in most cases differ in their interest rates, maturities and times of
issuance.

Each of these Funds may also invest in corporate debt securities and
convertible debt securities which are rated at the time of purchase within the
four highest rating groups assigned by an NRSRO (e.g., in the case of Moody's,
Aaa, Aa, A and Baa, and in the case of S&P, AAA, AA, A and BBB), which are
considered to be investment grade or, if unrated, which Qualivest deems to
present attractive opportunities and are of comparable quality. For a
description of NRSROs and their rating symbols, see the Appendix to the
Statement of Additional Information. For a discussion of debt securities rated
within the fourth highest rating group assigned by an NRSRO, see "INVESTMENT
TECHNIQUES AND RISK FACTORS--Medium-Grade Securities" herein.

Each of these Funds may hold short-term obligations (with maturities of 12
months or less) consisting of domestic and foreign commercial paper rated at the
time of purchase within the top two categories by an NRSRO (e.g., "A-2" or
better by S&P, "Prime-2" or better by Moody's, or "F-2" or better by Fitch
Investors Service ("Fitch")) or, if unrated, which Qualivest deems to present
attractive opportunities and are of comparable quality, including variable
amount master demand notes, bankers' acceptances, certificates of deposit and
time deposits of domestic and foreign branches of U.S. banks and foreign banks,
and repurchase agreements. These Funds may also invest in securities of other
investment companies or in Guaranteed Investment Contracts ("GICs"), which are
considered to be illiquid securities.

Each of these Funds may also invest in obligations of the Export-Import Bank
of the United States, in U.S. dollar denominated international bonds for which
the primary trading market is in the United States ("Yankee Bonds"), or for
which the primary trading market is abroad ("Eurodollar Bonds"), and in Canadian
Bonds and bonds issued by institutions, such as the World Bank and the European
Economic Community, organized for a specific purpose by two or more sovereign
governments ("Supranational Agency Bonds").

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<PAGE>
Each of these Funds expects to invest in a variety of U.S. Treasury
obligations, differing in their interest rates, maturities, and times of
issuance, as well as "stripped" U.S. Treasury obligations such as Treasury
Receipts issued by the U.S. Treasury representing either future interest or
principal payments ("Stripped Treasury Obligations"), and mortgage-related
securities issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, such as the Government National Mortgage Association
("GNMA"), the Federal National Mortgage Association ("FNMA"), the Federal Farm
Credit Bureau ("FFCB"), the Tennessee Valley Authority ("TVA"), the Federal Home
Loan Bank ("FHLB"), the Federal Land Bank, the Federal Home Loan Mortgage
Corporation ("FHLMC"), the Student Loan Marketing Association ("SLMA") and in
mortgage-related securities issued by nongovernmental entities.

Each of these Funds may invest in mortgage-related securities which are rated
at the time of purchase within the four highest rating categories assigned by an
NRSRO or, if unrated, which Qualivest deems to present attractive opportunities
and are of comparable quality, and have mortgage obligations backing such
securities, consisting of conventional thirty year fixed rate mortgage
obligations, graduated payment mortgage obligations, fifteen year mortgage
obligations and adjustable rate mortgage obligations.

Each of these Funds also may invest in mortgage-related securities issued by
nongovernmental entities. Commercial banks, savings and loan institutions,
private mortgage insurance companies, mortgage bankers and other secondary
market issuers also create pass-through pools of conventional residential
mortgage loans. Although the market for such securities is becoming increasingly
liquid, securities issued by certain private organizations may not be readily
marketable. These Funds will not purchase mortgage-related securities or any
other assets which in Qualivest's opinion are illiquid, if as a result, more
than 15% of the value of that Fund's net assets will be illiquid.

Mortgage-related securities in which these Funds may invest may also include
collateralized mortgage obligations ("CMOs"), which are debt obligations issued
generally by finance subsidiaries or trusts that are secured by mortgage-backed
certificates, including, in many cases, certificates issued by
government-related guarantors, including GNMA, FNMA and FHLMC, together with
certain funds and other collateral.

Each of these Funds may invest in asset-backed securities (unrelated to first
mortgage loans), which represent fractional interests in pools of leases, retail
installment loans or revolving credit receivables, both secured (such as
Certificates for Automobile Receivables or "CARS") and unsecured (such as Credit
Card Receivable Securities or "CARDS"). These assets are generally held by a
trust and payments of principal and interest or interest only are passed through
monthly or quarterly to certificate holders and may be guaranteed up to certain
amounts by letters of credit issued by a financial institution affiliated or
unaffiliated with the trustee or originator of the trust. Asset-backed
securities will be purchased only if they meet the rating requirements set forth
above or, if unrated, are deemed to be of comparable quality by Qualivest with
respect to these Funds' investments in fixed-income securities of U.S.
corporations and mortgage-related securities.

An increase in interest rates will generally reduce the value of the
investments in these Funds, and a decline in interest rates will generally
increase the value of those investments. Depending upon the prevailing market
conditions, Qualivest may purchase debt securities at a discount from face
value, which produces a yield greater than the coupon rate. Conversely, if debt
securities are purchased at a premium over face value, the yield will be lower
than the coupon rate.

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<PAGE>
TAX-FREE BOND FUND

Under normal market conditions, at least 65% of the total assets of the
Tax-Free Bond Fund will be invested in bonds. In addition, under normal market
conditions and as a fundamental policy, at least 80% of the net assets of the
Tax-Free Bond Fund will be invested in obligations consisting of bonds, notes
and commercial paper, issued by or on behalf of states, territories and
possessions of the United States, the District of Columbia and other political
subdivisions, agencies, instrumentalities and authorities, the interest on which
is both exempt from federal income tax and not treated as a preference item for
individuals for purposes of the federal alternative minimum tax ("Municipal
Securities").

The two principal classifications of Municipal Securities which may be held by
the Tax-Free Bond Fund are "general obligation" securities and "revenue"
securities. General obligation securities are secured by the issuer's pledge of
its full faith, credit and taxing power for the payment of principal and
interest. Revenue securities are payable only from the revenues derived from a
particular facility or class of facilities or, in some cases, from proceeds of a
special excise tax or other specific revenue source such as the user of the
facility being financed. Private activity bonds held by the Tax-Free Bond Fund
are in most cases revenue securities and are not payable from the unrestricted
revenues of the issuer. Consequently, the credit quality of private activity
bonds is usually directly related to the credit standing of the corporate user
of the facility involved.

The Tax-Free Bond Fund may also invest in "moral obligation" securities, which
are normally issued by special purpose public authorities. If the issuer of
moral obligation securities is unable to meet its debt service obligations from
current revenues, it may draw on a reserve fund, the restoration of which is a
moral commitment but not a legal obligation of the state or municipality which
created the issuer.

The Tax-Free Bond Fund invests primarily in Municipal Securities which are
rated at the time of purchase within the four highest rating groups assigned by
an NRSRO (which are considered to be investment grade) in the case of bonds, and
rated in the two highest rating categories by an NRSRO in the case of notes,
tax-exempt commercial paper, or variable rate demand obligations, or which are
unrated at the time of purchase but are determined to be of comparable quality
by Qualivest pursuant to guidelines approved by the Trust's Board of Trustees.
The NRSROs and applicable Municipal Securities ratings are described in the
Appendix to the Statement of Additional Information. For a discussion of debt
securities rated within the fourth highest rating group assigned by an NRSRO,
see "INVESTMENT TECHNIQUES AND RISK FACTORS--Medium Grade Securities" herein.

The Tax-Free Bond Fund may invest up to 5% of its total assets in municipal
lease obligations which meet the Fund's credit standards discussed above. The
Tax-Free Bond Fund may also hold uninvested cash reserves pending investment,
during temporary defensive periods or if, in the opinion of Qualivest, suitable
Municipal Securities are unavailable. There is no percentage limitation on the
amount of assets which may be held uninvested. Uninvested cash reserves will not
earn income. Under normal market conditions, and unless the Tax-Free Bond Fund
uses temporary defensive strategies, as discussed below, at least 80% of the net
assets of the Tax-Free Bond Fund will be invested in Municipal Securities.
However, investments of the Tax-Free Bond Fund may be made in taxable
obligations if, for example, suitable tax-exempt obligations are unavailable or
if Qualivest determines that, because of unstable conditions in the markets for
Municipal Securities, pursuing the Tax-Free Bond Fund's basic investment
strategies is inconsistent with the best interests of the Shareholders

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<PAGE>
of the Tax-Free Bond Fund. At such times, Qualivest may use temporary defensive
strategies differing from those designed to achieve the Tax-Free Bond Fund's
investment objective by increasing the Tax-Free Bond Fund's holdings in taxable
obligations to over 20% (and up to 100%) of the Tax-Free Bond Fund's net assets
and by holding uninvested cash reserves pending investment. Such taxable
obligations consist of obligations issued or guaranteed by the U.S. Government
or its agencies or instrumentalities, corporate debt securities (including
notes, bonds and debentures), certificates of deposit and bankers' acceptances
of selected banks, and commercial paper meeting the Tax-Free Bond Fund's quality
standards (as described above) for tax-exempt commercial paper, and such taxable
obligations which may be subject to repurchase agreements. These obligations are
described further in the Statement of Additional Information. Under such
circumstances and during the period of such investment, the Tax-Free Bond Fund
may not achieve its stated investment objective.

Interest income from certain types of municipal securities may be subject to
federal alternative minimum tax. The Tax-Free Bond Fund will not treat these
bonds as "Municipal Securities" for purposes of measuring compliance with the
80% policy described above. To the extent the Tax-Free Bond Fund invests in
these bonds, individual shareholders, depending on their own tax status, may be
subject to alternative minimum tax on that part of the Tax-Free Bond Fund's
distributions derived from these securities. For further information relating to
the types of municipal securities which will be included in income subject to
alternative minimum tax, see "ADDITIONAL INFORMATION--Additional Tax
Information" in the Statement of Additional Information.

Municipal Securities purchased by the Tax-Free Bond Fund may include rated and
unrated variable and floating rate tax-exempt notes. A variable rate note is one
whose terms provide for the adjustment of its interest rate on set dates and
which, upon such adjustment, can reasonably be expected to have a market value
that approximates its par value. A floating rate note is one whose terms provide
for the adjustment of its interest rate whenever a specified interest rate
changes and which, at any time, can reasonably be expected to have a market
value that approximates its par value. Such notes are frequently not rated by
credit rating agencies; however, unrated variable and floating rate notes
purchased by the Tax-Free Bond Fund will be determined by Qualivest, under
guidelines established by the Trust's Board of Trustees, to be of comparable
quality at the time of purchase to rated instruments eligible for purchase under
the Tax-Free Bond Fund's investment policies. In making such determinations,
Qualivest will consider the earning power, cash flow and other liquidity ratios
of the issuers of such notes (such issuers include financial, merchandising,
bank holding and other companies) and will continuously monitor their financial
condition. There may be no active secondary market with respect to a particular
variable or floating rate note. Nevertheless, the periodic readjustments of
their interest rates tend to assure that their value to the Tax-Free Bond Fund
will approximate their par value. The Tax-Free Bond Fund will not purchase
variable and floating rate notes or any other securities which in Qualivest's
opinion are illiquid if, as a result, more than 15% of the Tax-Free Bond Fund's
net assets will be illiquid.

Although the Tax-Free Bond Fund may invest more than 25% of its total assets
in (i) Municipal Securities whose issuers are in the same state,

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(ii) Municipal Securities the interest on which is paid solely from revenues of
similar projects, and (iii) private activity bonds, it does not presently intend
to do so on a regular basis. To the extent the Tax-Free Bond Fund's assets are
concentrated in Municipal Securities that are payable from the revenues of
similar projects or are issued by issuers located in the same state, or are
concentrated in private activity bonds, the Tax-Free Bond Fund will be subject
to the peculiar risks presented by the laws and economic conditions relating to
such states, projects and bonds to a greater extent than it would be if its
assets were not so concentrated.

* * * *

In making investment decisions for the Income Funds, Qualivest will consider
many factors, including current yield, maturity, and yield to maturity.
Qualivest will also monitor the financial condition of the issuers of the Income
Funds' portfolio investments and may shorten the average weighted portfolio
maturity of an Income Fund, in light of each such Fund's investment objective of
preservation of capital, if economic or market conditions warrant such action.

INVESTMENT POLICIES--MONEY FUNDS

U.S. TREASURY FUND

MONEY MARKET FUND

TAX-FREE MONEY MARKET FUND

The Tax-Free Money Market Fund invests primarily in high quality money market
Municipal Securities and similar tax-exempt money market instruments that,
although not rated, are deemed to be of comparable high quality as determined by
Qualivest pursuant to guidelines adopted by the Board of Trustees. As a matter
of fundamental policy, under normal market conditions, at least 80% of the
Tax-Free Money Market Fund's net assets will be invested in short-term Municipal
Securities.

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<PAGE>

of unstable conditions in the markets for Municipal Securities, pursuing the
Tax-Free Money Market Fund's basic investment strategies is inconsistent with
the best interests of the Shareholders of the Tax-Free Money Market Fund. At
such times, Qualivest may use temporary defensive strategies differing from
those designed to achieve the Tax-Free Money Market Fund's investment objective
by increasing the Tax-Free Money Market Fund's holdings in taxable obligations
to over 20% (and up to 100%) of the Tax-Free Money Market Fund's net assets and
by holding uninvested cash reserves pending investment. Taxable obligations may
include obligations issued or guaranteed by the U.S. Government or its agencies
or instrumentalities (some of which may be subject to repurchase agreements),
certificates of deposit and bankers' acceptances of selected banks, and
commercial paper meeting the Tax-Free Money Market Fund's quality standards (as
described below) for tax-exempt commercial paper.

* * * *

Each Money Fund invests exclusively in U.S. dollar denominated instruments
which Qualivest, acting pursuant to guidelines adopted by the Board of Trustees,
determines present minimal credit risks and which at the time of acquisition are
rated by one or more appropriate NRSROs (e.g., S&P, Moody's and Fitch) within
one of the two highest rating categories for short-term debt obligations or, if
unrated, are of comparable quality. In addition, each Money Fund except for the
Tax-Free Money Market Fund diversifies its investments so that, with minor
exceptions and except for U.S. Government securities, not more than 5% of its
total assets is invested in the securities of any one issuer, not more than 5%
of its total assets is invested in securities of all issuers rated by the NRSRO
at the time of investment in the second highest rating category for short-term
debt obligations or in unrated securities deemed to be of comparable quality to
securities rated in the second highest rating categories for short-term debt
obligations ("Second Tier Securities") and not more than the greater of 1% of
total assets or one million dollars is invested in the securities of any one
issuer of Second Tier Securities. In addition, no Money Fund will invest more
than 10% of its net assets in securities that are deemed to be illiquid at the
time of purchase. All securities or instruments in which a Fund invests have
remaining maturities of 397 calendar days (thirteen months) or less. In
addition, no Money Fund will invest more than 10% of its net assets in
securities that are deemed to be illiquid. The dollar-weighted average maturity
of the obligations in a Money Fund will not exceed 90 days.

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INVESTMENT TECHNIQUES AND RISK FACTORS

Like any investment program, an investment in a Fund entails certain risks.

U.S. GOVERNMENT OBLIGATIONS

MORTGAGE-RELATED AND ASSET-BACKED SECURITIES

24
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BANKERS' ACCEPTANCES

CERTIFICATES OF DEPOSIT AND TIME DEPOSITS

COMMERCIAL PAPER

25
<PAGE>

Qualivest pursuant to guidelines adopted by the Board of Trustees to be of
comparable quality to instruments that are so rated. The Equity Funds may invest
in such instruments if rated in the four highest categories assigned by an NRSRO
or, if not rated, found by Qualivest pursuant to guidelines adopted by the Board
of Trustees to be of comparable quality. Instruments may be purchased in
reliance upon a rating only when the rating organization is not affiliated with
the issuer or guarantor of the instrument. For a description of the rating
symbols of the NRSROs as used in this paragraph, see the Appendix to the
Statement of Additional Information. The Money Market Fund, the Equity Funds and
the Income Funds may also invest in Canadian Commercial Paper, which is
commercial paper issued by a Canadian corporation or a Canadian counterpart of a
U.S. corporation, and in Europaper, which is U.S. dollar denominated commercial
paper of a foreign issuer.

PUT AND CALL OPTIONS

Each Equity and Income Fund may purchase put and call options on securities,
and each Equity Fund other than the Optimized Fund may purchase such options on
foreign currencies, subject to its applicable investment policies, for the
purposes of hedging against market risks related to its portfolio securities and
adverse movements in exchange rates between currencies, respectively. Purchasing
options is a specialized investment technique that entails a substantial risk of
a complete loss of the amounts paid as premiums to writers of options. Each Fund
may also engage in writing call options from time to time as Qualivest deems
appropriate. The Funds will write only covered call options (options on
securities or currencies owned by the particular Fund). In order to close out a
call option it has written, a Fund will enter into a "closing purchase
transaction"--the purchase of a call option on the same security or currency
with the same exercise price and expiration date as the call option which such
Fund previously has written. When a portfolio security or currency subject to a
call option is sold, the Fund will effect a closing purchase transaction to
close out any existing call option on that security or currency. If such Fund is
unable to effect a closing purchase transaction, it will not be able to sell the
underlying security or currency until the option expires or that Fund delivers
the underlying security or currency upon exercise. In addition, upon the
exercise of a call option by the holder thereof, the Fund will forego the
potential benefit represented by market appreciation over the exercise price.
Under normal conditions, it is not expected that a Fund will cause the
underlying value of portfolio securities and/or currencies

26
<PAGE>
subject to such options to exceed 25% of its total assets.

FOREIGN SECURITIES

Investment in foreign securities is subject to special investment risks that
differ in some respects from those related to investments in securities of U.S.
domestic issuers. Such risks include political, social or economic instability
in the country of the issuer, the difficulty of predicting international trade
patterns, the possibility of the imposition of exchange controls, expropriation,
limits on removal of currency or other assets, nationalization of assets,
foreign withholding and income taxation, and foreign trading practices
(including higher trading commissions, custodial charges and delayed
settlements). Such securities may be subject to greater fluctuations in price
than securities issued by U.S. corporations or issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. The markets on which such
securities trade may have less volume and liquidity, and may be more volatile
than securities markets in the U.S. In addition, there may be less publicly
available information about a foreign company than about a U.S. domiciled
company. Foreign companies generally are not subject to uniform accounting,
auditing and financial reporting standards comparable to those applicable to
U.S. domestic companies. There is generally less government regulation of
securities exchanges, brokers and listed companies abroad than in the U.S.
Confiscatory taxation or diplomatic developments could also affect investment in
those countries. In addition, foreign branches of U.S. banks, foreign banks and
foreign issuers may be subject to less stringent reserve requirements and to
different accounting, auditing, reporting, and recordkeeping standards than
those applicable to domestic branches of U.S. banks and U.S. domestic issuers.

27
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right to receive securities of foreign issuers deposited in a domestic bank or a
correspondent bank. ADRs do not eliminate all the risk inherent in investing in
the securities of foreign issuers. However, by investing in ADRs rather than
directly in foreign issuers' stock, an eligible Equity Fund can avoid currency
risks during the settlement period for either purchases or sales.

FOREIGN CURRENCY TRANSACTIONS

The value of the assets of an Equity Fund other than the Optimized Fund as
measured in U.S. dollars may be affected favorably or unfavorably by changes in
foreign currency exchange rates and exchange control regulations, and a Fund may
incur costs in connection with conversions between various currencies. An Equity
Fund will conduct its foreign currency exchange transactions either on a spot
(i.e., cash) basis at the spot rate prevailing in the foreign currency exchange
market, or through forward contracts to purchase or sell foreign currencies. A
forward foreign currency exchange contract ("forward currency contract")
involves an obligation to purchase or sell a specific currency at a future date,
which may be any fixed number of days from the date of the contract agreed upon
by the parties, at a price set at the time of the contract. These forward
currency contracts are traded directly between currency traders (usually large
commercial banks) and their customers. The Equity Funds may enter into forward
currency contracts in order to hedge against adverse movements in exchange rates
between currencies.

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<PAGE>

currency. Although such contracts tend to minimize the risk of loss due to a
decline in the value of the hedged currency, they also tend to limit any
potential gain which might result should the value of such currency increase.
The Funds will have to convert their holdings of foreign currencies into U.S.
dollars from time to time. Although foreign exchange dealers do not charge a fee
for conversion, they do realize a profit based on the difference (the "spread")
between the prices at which they are buying and selling various currencies.

REPURCHASE AGREEMENTS

Securities held by a Fund (other than the U.S. Treasury Fund) may be subject
to repurchase agreements. Under the terms of a repurchase agreement, a Fund
would acquire securities from financial institutions, subject to the seller's
agreement to repurchase such securities at a mutually agreed upon date and
price, which includes interest negotiated on the basis of current short-term
rates. The seller under a repurchase agreement will be required to maintain at
all times the value of collateral held pursuant to the agreement at not less
than the repurchase price (including accrued interest). If a seller defaults on
its repurchase obligations, a Fund may suffer a loss in disposing of the
security subject to the repurchase agreement. For further information about
repurchase agreements, see "INVESTMENT OBJECTIVES AND POLICIES--Additional
Information on Portfolio Instruments--Repurchase Agreements" in the Statement of
Additional Information.

REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLL AGREEMENTS

FUTURES CONTRACTS

The Equity and Income Funds may also enter into contracts for the future
delivery of securities or foreign currencies and futures contracts based on a
specific security, class of securities, foreign currency or an index, purchase
or sell options on any such futures contracts and engage in related closing
transactions. A futures contract on a securities index is an agreement
obligating either party to pay, and entitling the other party to receive, while
the contract is outstanding, cash payments based on the level of a specified
securities index.

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<PAGE>
A Fund may engage in such futures contracts in an effort to hedge against
market risks and to manage its cash position, but not for leveraging purposes.
For example, when interest rates are expected to rise or market values of
portfolio securities are expected to fall, a Fund can seek through the sale of
futures contracts to offset a decline in the value of its portfolio securities.
When interest rates are expected to fall or market values are expected to rise,
a Fund, through the purchase of such contracts, can attempt to secure better
rates or prices for the Fund than might later be available in the market when it
effects anticipated purchases.

WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS

The Funds may each purchase securities on a when-issued or delayed-delivery
basis. A Fund will engage in when-issued and delayed-delivery transactions only
for the purpose of acquiring portfolio securities consistent with its investment
objective and policies, not for investment leverage. When-issued securities are
securities purchased for delivery beyond the normal settlement date at a stated
price and yield and thereby involve a risk that the yield obtained in the
transaction will be less than those available in the market when delivery takes
place. A Fund will not pay for such securities or start earning interest on them
until they are received. When a Fund agrees to purchase such securities, its
Custodian will set aside cash or high grade liquid debt securities equal to the
amount of the commitment in a segregated account. Securities purchased on a
when-issued basis are recorded as an asset and are subject to changes in value
based upon changes in the general level of interest rates. In when-issued and
delayed-delivery transactions, a Fund relies on the seller to complete the
transaction; the seller's failure to do so may cause such Fund to miss a price
or yield considered to be advantageous.

LENDING OF PORTFOLIO SECURITIES

MEDIUM-GRADE SECURITIES

As described above, each of the Income Funds, the Large Companies Fund, the
Small Companies Fund and the Income Equity Fund may invest up to 10% of its
total assets in debt securities within the fourth highest rating group

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assigned by an NRSRO (i.e., BBB or Baa by S&P and Moody's, respectively) and
comparable unrated securities. These types of debt securities are considered by
Moody's and S&P to have some speculative characteristics, and are more
vulnerable to changes in economic conditions, higher interest rates or adverse
issuer-specific developments which are more likely to lead to a weaker capacity
to make principal and interest payments than comparable higher rated debt
securities.

Should subsequent events cause the rating of a debt security purchased by one
of these Funds to fall below BBB or Baa, as the case may be, Qualivest will
consider such an event in determining whether a Fund should continue to hold
that security. In no event, however, would a Fund be required to liquidate any
such portfolio security where the Fund would suffer a loss on the sale of such
security.

SECURITIES ISSUED BY OTHER INVESTMENT COMPANIES

RESTRICTED SECURITIES

Securities in which the Funds may invest include securities issued by
corporations without registration under the Securities Act of 1933, as amended
(the "1933 Act"), in reliance on the so-called "private placement" exemption
from registration which is afforded by Section 4(2) of the 1933 Act ("Section
4(2) securities"). Section 4(2) securities are restricted as to disposition
under the federal securities laws, and generally are sold to institutional
investors such as the Funds who agree that they are purchasing the securities
for investment and not with a view to public distribution. Any resale must also
generally be made in an exempt transaction. Section 4(2) securities are normally
resold to other institutional investors through or with the assistance of the
issuer or investment dealers who make a market in such Section 4(2) securities,
thus providing liquidity. Pursuant to procedures adopted by the Board of
Trustees of the Trust, Qualivest may determine Section 4(2) securities to be
liquid if such securities are readily marketable. These securities may include
securities eligible for resale under Rule 144A under the 1933 Act.

PRIVATE ACTIVITY BONDS

The Tax-Free Money Market Fund and Tax-Free Bond Fund may also invest in
private activity bonds. It should be noted that the Tax Reform Act of 1986
substantially revised provisions of prior federal law affecting the issuance and
use of proceeds of certain tax-exempt obligations. A new definition of private
activity bonds applies to many types of bonds, including those which were
industrial development bonds under prior law. Interest on private activity bonds
is tax-exempt (and such bonds will be considered Municipal Securities for
purposes of this Prospectus) only if the bonds fall within certain defined
categories of qualified private activity bonds and meet the requirements
specified in those respective categories. If either of the Funds invests in
private activity bonds which fall outside these categories, the interest from
such bonds will not be exempt from federal income tax. The Tax Reform Act
generally does not change the federal tax treatment of bonds issued to finance
government operations. For further information relating to the types of private
activity bonds which will be included in income subject to the alternative
minimum tax, see "ADDITIONAL INFORMATION--Additional Tax

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Information" in the Statement of Additional Information.

MUNICIPAL SECURITIES

The Tax-Free Money Market Fund will invest only in those Municipal Securities
which are considered by Qualivest to present minimal credit risks and which at
the time of purchase are rated high quality by an NRSRO (e.g., rated "AA" or
higher by S&P or "Aa" or higher by Moody's in the case of bonds; rated "SP-2" or
higher by S&P or "MIG-2" or higher by Moody's in the case of notes; rated
"VMIG-2" or higher by Moody's in the case of variable rate demand notes; and
rated "A-2" or higher by S&P or "Prime-2" or higher by Moody's in the case of
tax-exempt commercial paper) or which are unrated at the time of purchase but
are determined to be of comparable quality by Qualivest pursuant to guidelines
approved by the Trust's Board of Trustees. The Tax-Free Bond Fund also will
invest in these Municipal Securities, as well as investment grade bonds.
Municipal Securities may be purchased in reliance upon a rating only where the
rating organization is not affiliated with the issuer or guarantor of the
Municipal Securities. If a security is subject to a demand feature, the security
must receive both a short-term and a long-term high quality rating or must be
determined to be of comparable quality by Qualivest; except that where the
demand feature is considered to be "unconditional" under the 1940 Act, the
security may be acquired solely in reliance on a short-term high quality rating
or a determination of comparable quality by Qualivest of the unconditional
demand feature. The applicable Municipal Securities ratings are described in the
Appendix to the Statement of Additional Information.

The two principal classifications of Municipal Securities which may be held by
the Funds are "general obligation" securities and "revenue" securities. General
obligation securities are secured by the issuer's pledge of its full faith,
credit and taxing power for the payment of principal and interest. Revenue
securities are payable only from the revenues derived from a particular facility
or class of facilities or, in some cases, from the proceeds of a special excise
tax or other specific revenue source such as the user of the facility being
financed.

Private activity bonds held by the Funds are in most cases revenue securities
and are not payable from the unrestricted revenues of the issuer. Consequently,
the credit quality of private activity bonds is usually directly related to the
credit standing of the corporate user of the facility involved.

Municipal Securities in which the Funds may invest may also include "moral
obligation" bonds, which are normally issued by special purpose public
authorities. If the issuer of moral obligation bonds is unable to meet its debt
service obligations from current revenues, it may draw on a reserve fund, the
restoration of which is a moral commitment but not a legal obligation of the
state or municipality which created the issuer.

Municipal Securities purchased by the Funds may include rated and unrated
variable and floating rate tax-exempt notes, which may have a stated maturity in
excess of 397 days but which will, in such event, be subject to a demand feature
that will permit the Funds to demand payment of the principal of the note either
(i) at any time upon not more than thirty days' notice or (ii) at specified
intervals not exceeding 397 days and upon no more than thirty days' notice.
There may be no active secondary market with respect to a particular variable or
floating rate note. Nevertheless, the periodic readjustments of their interest
rates tend to assure that their value to a Fund will approximate their par
value. Variable and floating rate notes for which no readily available market
exists will be purchased in an amount which, together with other illiquid
securities, exceeds 10% of the Tax-Free Money Market Fund's net assets (15% for
the Tax-Free Bond Fund) only if such notes are subject to a

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demand feature that will permit such Fund to receive payment of the principal
within seven days after demand by the Fund.

The Funds may acquire zero coupon obligations, which have greater price
volatility than coupon obligations and which will not result in the payment of
interest until maturity.

The Funds may also purchase Municipal Securities on a "when-issued" basis.
"When-issued" securities are securities purchased for delivery beyond the normal
settlement date at a stated price and yield, thereby involving the risk that the
yield obtained in the transaction will be less than that available in the market
when delivery takes place. The Funds will not pay for such securities, and no
income accrues on the securities, until they are received. Securities purchased
on a "when-issued" basis are recorded as an asset and are subject to changes in
value based upon changes in the general level of interest rates. A Fund's
commitments to purchase "when-issued" securities will not exceed 25% of the
value of its total assets under normal market conditions, and a commitment by a
Fund to purchase "when-issued" securities will not exceed 60 days.

Opinions relating to the validity of Municipal Securities and to the exemption
of interest thereon from federal income tax are rendered by bond counsel to the
respective issuers at the time of issuance. Neither the Funds nor Qualivest will
review the proceedings relating to the issuance of Municipal Securities or the
basis for such opinions. Although the Funds presently do not intend to do so on
a regular basis, each may invest more than 25% of its total assets in Municipal
Securities which are related in such a way that an economic, business, or
political development or change affecting one such security would likewise
affect the other Municipal Securities. Examples of such securities are
obligations the repayment of which is dependent upon similar types of projects
or projects located in the same state. Such investments would be made only if
deemed necessary or appropriate by Qualivest. To the extent that a Fund's assets
are concentrated in Municipal Securities that are so related, the Fund will be
subject to the peculiar risks presented by such Municipal Securities, such as
negative developments in a particular industry or state, to a greater extent
than it would be if the Fund's assets were not so concentrated.

PUTS

The Tax-Free Money Market Fund and the Tax-Free Bond Fund may each acquire
"puts" with respect to Municipal Securities held in its portfolio. Under a put,
a Fund would have the right to sell a specified Municipal Security within a
specified period of time at a specified price. A put would be sold, transferred,
or assigned only with the underlying Municipal Security. The Funds will acquire
puts solely to either facilitate portfolio liquidity, shorten the maturity of
the underlying Municipal Securities, or permit the investment of each Fund's
assets at a more favorable rate of return. The aggregate price of a security
subject to a put may be higher than the price which otherwise would be paid for
the security without such an option, thereby increasing the security's cost and
reducing its yield.

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VALUATION OF SHARES

The net asset value of each Equity and Income Fund is determined and its
Shares are priced as of the close of regular trading on the New York Stock
Exchange ("NYSE") (generally 1:00 p.m. Pacific Time) on each Business Day
("Valuation Time"). The net asset value of each Money Fund is determined and its
Shares are priced as of 11:30 a.m. Pacific Time and as of the close of regular
trading on the NYSE on each Business Day (also "Valuation Times"). As used
herein a "Business Day" is a day on which the NYSE is open for trading, the
Federal Reserve Bank of San Francisco is open, and any other day except days on
which there are insufficient changes in the value of a Fund's portfolio
securities to materially affect the Fund's net asset value or days on which no
Shares are tendered for redemption and no order to purchase any Shares is
received. Currently, the NYSE or the Federal Reserve Bank of San Francisco is
closed on the following holidays: New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Columbus Day, Veterans Day, Thanksgiving and Christmas.

The net asset value per Share of the Equity and Income Funds will fluctuate as
the value of the investment portfolio of an Equity or Income Fund changes.

The securities in each Equity and Income Fund will be valued at market value.
If market quotations are not available, the securities will be valued by a
method which the Board of Trustees believes accurately reflects fair value. The
assets in each Money Fund are valued based upon the amortized cost method. For
further information about valuation of investments, see "NET ASSET VALUE" in the
Statement of Additional Information.

PURCHASING SHARES

Class Y Shares may be purchased through a broker-dealer, bank, or trust
company that has established a dealer agreement with the Distributor. Class Y
Shares of each Fund are continuously offered and also may be purchased directly
either by mail, by telephone, or by wire.

An Account Application Form can be obtained by calling the Trust at
1-800-743-8637.

OTHER INFORMATION REGARDING PURCHASES

Purchases of Class Y Shares of the Funds will be executed at the next
calculated net asset value per Share following the receipt by the Trust of an
order to purchase Class Y Shares in good form ("public offering price"). In the
case of orders for the purchase of Class Y Shares placed through a
broker-dealer, the applicable public offering price will be the net asset value
as so determined, but only if the Distributor receives the order prior to the
next Valuation Time for that day and transmits it to the Trust by that Valuation
Time. The broker-dealer is responsible for transmitting such orders promptly. If
the broker-dealer fails to do so, the investor's right to that day's closing
price must be settled between the investor and the broker-dealer. Purchases of
Class Y Shares of any of the Funds will be effected only on a Business Day of
the Funds. An order received prior to a Valuation Time on any Business Day will
be executed at the net asset

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value determined as of the next Valuation Time on the date of receipt. An order
received after the Valuation Time on any Business Day will be executed at the
net asset value determined as of the next Valuation Time on the next Business
Day of that Fund. Shares of the Money Funds purchased before 11:30 a.m. Pacific
Time begin earning dividends on the same Business Day. Shares of the Money Funds
purchased after 11:30 a.m. Pacific Time begin earning dividends on the next
Business Day. All Shares of the Money Funds continue to earn dividends through
the day before their redemption.

Every Shareholder will receive a confirmation of, or account statement
reflecting, each new transaction in the Shareholder's account, which will also
show the total number of Class Y Shares of the respective Fund owned by the
Shareholder. Shareholders may rely on these statements in lieu of certificates.
Certificates representing Class Y Shares of the Funds will not be issued.

EXCHANGE PRIVILEGE

The exchange privilege enables Shareholders of Class Y Shares to acquire Class
Y Shares offered by another Fund with a different investment objective. Holders
of a Fund's Class Y Shares may not exchange their Shares for Class A, Class C or
Class Q Shares, and holders of a Fund's Class A, Class C or Class Q Shares may
not exchange their Shares for Class Y Shares. Holders of Class Y Shares of one
of the Funds (including Class Y Shares acquired through reinvestment of
dividends and distributions on such Shares) may exchange those Class Y Shares at
net asset value for Class Y Shares offered by any of the other Funds.

An exchange is considered a sale of Shares and may result in a capital gain or
loss for federal income tax purposes.

A Shareholder wishing to exchange his or her Shares may do so by contacting
the appropriate Custodian or an affiliate. Any Shareholder who wishes to make an
exchange should obtain and review the current prospectus of the Fund to be
acquired before making the exchange. For a discussion of risks associated with
unauthorized telephone exchanges, see "REDEEMING SHARES--By Telephone" below.

REDEEMING SHARES

Shareholders may redeem their Class Y Shares without charge on any day that
net asset value is calculated (see "VALUATION OF SHARES"). Redemptions will be
effected at the net asset value per Share next determined after receipt by the
Distributor of a redemption request. Redemptions may be requested by mail or by
telephone.

BY MAIL

A written request for redemption must be received by the Distributor in order
to honor the request. The Distributor's address is: BISYS Fund Services, 3435
Stelzer Road, Columbus, Ohio 43219-3035. The Transfer Agent will require a
signature guarantee by an eligible guarantor institution. The signature
guarantee requirement will be waived if all of the following conditions apply:
(1) the redemption check is payable to the Shareholder(s) of record, and (2) the
redemption check is mailed to the Shareholder(s) at the address of record. The
Shareholder may also have the proceeds mailed to a commercial bank account
previously designated on the Account Application Form. There is no charge for
having redemption proceeds mailed to a designated bank account. To change the

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address to which a redemption check is to be mailed, a written request therefor
must be received by the Transfer Agent. In connection with such request, the
Transfer Agent will require a signature guarantee by an eligible guarantor
institution.

For purposes of this policy, the term "eligible guarantor institution" shall
include banks, brokers, dealers, credit unions, securities exchanges and
associations, clearing agencies and savings associations as those terms are
defined in the Securities Exchange Act of 1934. The Transfer Agent reserves the
right to reject any signature guarantee if (1) it has reason to believe that the
signature is not genuine, (2) it has reason to believe that the transaction
would otherwise be improper, or (3) the guarantor institution is a broker or
dealer that is neither a member of a clearing corporation nor maintains net
capital of at least $100,000.

BY TELEPHONE

Class Y Shares may be redeemed by telephone if the Account Application Form
reflects that the Shareholder has elected that privilege. If the telephone
feature was not originally selected, the Shareholder must provide written
instructions to the Trust to add it. The Shareholder may have the proceeds
mailed to the Shareholder's address or mailed or wired to a commercial bank
account previously designated on the Account Application Form. Under most
circumstances, payments will be transmitted on the next Business Day. Wire
redemption requests may be made by the Shareholder by telephone to the Trust at
1-800-743-8637. While the Transfer Agent currently does not charge a wire
redemption fee, the Transfer Agent reserves the right to impose such a fee in
the future.

OTHER INFORMATION REGARDING REDEMPTION OF SHARES

All redemption orders are effected at the net asset value per Share next
determined after the Class Y Shares are properly tendered for redemption, as
described above. The proceeds paid upon redemption of Class Y Shares in the
Funds may be more or less than the amount invested. Payment to Shareholders for
Shares redeemed will be made within seven days after receipt of the request for
redemption, or within such shorter period as required by law. To the greatest
extent possible, requests from Shareholders of an Equity or Income Fund for next
Business Day payments upon redemption of Shares will be honored if received by
the Distributor before the last Valuation Time on a Business Day or, if received
after the last Valuation Time, within two Business Days, unless it would be
disadvantageous to that Fund or its Shareholders to sell or liquidate portfolio
securities in an amount sufficient to satisfy requests for payments in that
manner. Likewise, the Trust will

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attempt to honor requests from Shareholders for same Business Day payments upon
redemption of Class Y Shares of the Money Funds if the request for redemption is
received by the Distributor before 11:30 a.m. Pacific Time on a Business Day or,
if the request for redemption is received after 11:30 a.m. Pacific Time, to
honor requests for payment on the next Business Day, unless it would be
disadvantageous to that Fund or its Shareholders to sell or liquidate portfolio
securities in an amount sufficient to satisfy requests for payments in that
manner.

At various times, the Trust may be requested to redeem Class Y Shares for
which it has not yet received good payment. In such circumstances, the
forwarding of proceeds may be delayed until payment has been collected for the
purchase of such Class Y Shares, which delay may be for 15 days or more. Such
delay may be avoided if Class Y Shares are purchased by wire transfer of federal
funds. The Trust intends to pay cash for all Class Y Shares redeemed, but under
abnormal conditions which make payment in cash unwise, payment may be made
wholly or partly in portfolio securities at their then market value equal to the
redemption price. In such cases, an investor may incur brokerage costs in
converting such securities to cash.

See the Statement of Additional Information ("ADDITIONAL PURCHASE AND
REDEMPTION INFORMATION") for examples of when the right of redemption may be
suspended.

MANAGEMENT OF THE FUNDS

TRUSTEES

INVESTMENT ADVISER

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including investment research and management with respect to the Funds'
portfolio securities, investments and cash.

John R. Swank, the Equity Manager with primary investment responsibility for
the Income Equity Fund, has eighteen years of experience in portfolio
management, including fifteen years of employment by Qualivest. He has a
Bachelor of Science degree in Finance and a Masters of Business Administration
degree, both from Long Beach State University. Mr. Swank is also a Chartered
Financial Analyst.

Edgar M. Potts is the Fixed-Income Manager who is responsible for portfolio
management of the Tax-Free Bond Fund. He has thirty-three years of investment
management experience and has been employed by Qualivest since 1977. Mr. Potts
has a Bachelor of Science degree in Economics from Georgetown University.

For the services provided and expenses assumed pursuant to its Investment
Advisory Agreement with the Trust, Qualivest receives a fee from each of the
Funds, computed daily and paid monthly, at the following annual rates of each
Fund's average daily net assets: Large Companies Fund--0.75%; Small Companies
Fund--0.80%; Income Equity Fund--0.60%; International Fund--0.60%; Optimized
Fund-- 0.50%; Intermediate Bond Fund--0.60%; Bond Fund--0.60%; Tax-Free Bond
Fund--0.50%; U.S. Treasury Fund--0.35%; Money Market Fund--0.35%; and Tax-Free
Money Market Fund--0.35%.

While the fees for the Large Companies and Small Companies Funds are higher
than the advisory fee paid by most investment companies, the Board of Trustees
believes them to be comparable to advisory fees paid by many funds having
similar objectives and policies. Qualivest may periodically voluntarily reduce
all or a portion of its advisory fee with respect to a Fund to increase the net
income of that Fund available for distribution as dividends. The voluntary fee
reduction will cause the return of that Fund to be higher than it would
otherwise be in the absence of such reduction.

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ADMINISTRATOR AND DISTRIBUTOR

The Distributor acts as agent for the Funds in the distribution of their
Shares and, in such capacity, solicits orders for the sale of Shares,
advertises, and pays the cost of advertising, office space and its personnel
involved in such activities. Under its Distribution Agreement with the Trust,
the Distributor may retain some or all of any sales charge imposed upon the
Class A or Class C Shares. It may also receive compensation under the
Distribution and Shareholder Service Plans regarding the Class A, Class C, and
Class Q Shares.

OTHER SERVICE PROVIDERS

While BISYS Fund Services Ohio, Inc. is a distinct legal entity from BISYS
(the Trust's administrator and distributor), BISYS Fund Services Ohio, Inc. is
considered to be an affiliated person of BISYS under the 1940 Act due to, among
other things, the fact that BISYS Fund Services Ohio, Inc. is owned by
substantially the same persons that directly or indirectly own BISYS.

EXPENSES

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<PAGE>

maintenance of the Trust's existence, costs of Shareholders' reports and
meetings, and any extraordinary expenses incurred in each Fund's operation. The
ratios of operating expenses to average daily net assets of the Class Y Shares
for the period ended July 31, 1995 were as follows: Large Companies Fund--0.53%;
Small Companies Fund--0.60%; International Fund--1.18%; Optimized Fund--0.68%;
Intermediate Bond Fund--0.41%; Bond Fund--0.70%; U.S. Treasury Fund--0.40%;
Money Market Fund-- 0.38%; and Tax-Free Money Market Fund-- 0.59%.

As a general matter, expenses are allocated to the Class A, Class C, Class Q
and Class Y Shares of the Funds on the basis of the relative net asset value of
each class. Class A and Class C Shares may bear certain additional retail
transfer agency expenses. Class A, Class C and Class Q Shares also bear certain
additional Shareholder service and distribution costs incurred pursuant to the
Distribution and Shareholder Service Plans.

The Trustees reserve the right, subject to the receipt of relevant regulatory
approvals or rulings, if needed, to allocate certain other expenses to the
Shareholders of a particular class, including Class Y Shares, on a basis other
than relative net asset value, as they deem appropriate ("Class Expenses"). In
such event, Class Expenses would be limited to: transfer agency fees identified
by the Transfer Agent as attributable to a specific class; printing and postage
expenses related to preparing and distributing materials such as Shareholder
reports, prospectuses and proxies to current Shareholders; Blue Sky registration
fees incurred by a class of Shares; Securities and Exchange Commission
registration fees incurred by a class of Shares; expenses related to
administrative personnel and services as required to support the Shareholders of
a specific class; litigation or other legal expenses relating solely to one
class of Shares; and Trustees' fees incurred as a result of issues relating
solely to one class of Shares.

PORTFOLIO TRANSACTIONS

BANKING LAWS

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or, if that course of action appeared impractical, that the Funds be liquidated.

PARTICIPATING ORGANIZATIONS

The Distributor may enter into agreements with banks and their affiliates
(including U.S. Bank and its affiliates), and other institutions, including
broker-dealers (each a "Participating Organization"), for providing Shareholder
services with respect to the Class Y Shares. Such Participating Organizations
will be compensated at the annual rate of up to 0.25% of the average daily net
assets of the Class Y Shares held of record or beneficially by customers of
Participating Organizations who are record or beneficial owners of Class Y
Shares. The Trust understands that Participating Organizations may charge fees
to their customers who are the owners of Class Y Shares for additional services
provided in connection with their customer accounts. These fees would be in
addition to any amounts which may be received by a Participating Organization
under its agreement with BISYS. Customers of Participating Organizations should
read this Prospectus in light of the terms governing their accounts with their
Participating Organizations.

The Shareholder services provided by Participating Organizations for which the
fee may be paid may include providing information periodically to customers,
including information showing their positions in Class Y Shares; responding to
inquiries from customers concerning their investment in Class Y Shares;
providing sub-accounting with respect to Class Y Shares beneficially owned by
customers or the information necessary for sub-accounting; arranging for bank
wires; and other continuing personal services to holders of Class Y Shares.

DIVIDENDS AND TAXES

DIVIDENDS

Net income is declared quarterly as a dividend to Shareholders of record of
the Equity Funds at the close of business on the eleventh Business Day of each
Equity Fund's fiscal quarter and is generally paid quarterly. Net income is
declared monthly at the close of business on the eleventh Business Day of each
month and is generally paid monthly for the Income Funds. Distributable net
realized capital gains are distributed at least annually. The net income,
excluding short-term capital gains, of each Money Fund is declared daily as a
dividend to Shareholders of such Fund at the close of business on the day of
declaration. Dividends consisting of short-term capital gains are declared from
time to time as may be appropriate. Dividends for the Money Funds are paid
monthly. A Shareholder will automatically receive all income dividends and
capital gains distributions in additional full and fractional Shares at net
asset value as of the date of declaration, unless the Shareholder elects to
receive dividends or distributions in cash. Such election, or any revocation
thereof, must be made in writing to the Transfer Agent at 3435 Stelzer Road,
Columbus, Ohio 43219-3035, and will become effective with respect to dividends
and distributions having record dates after its receipt by the Transfer Agent.

FEDERAL TAXES

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Distributions from a Fund's investment company taxable income (which includes,
among other items, dividends, taxable interest and the excess, if any, of net
short-term capital gains over net long-term capital losses) are taxable to
Shareholders as ordinary income. Dividends paid by the Equity Funds to corporate
Shareholders, to the extent such dividends are attributable to dividends
received from U.S. corporations, may qualify for the dividends-received
deduction. However, the alternative minimum tax applicable to corporations may
reduce the value of the dividends-received deduction. Distributions of net
capital gains (the excess of net long-term capital gains over net short-term
capital losses), if any, designated by a Fund as capital gain dividends, are
taxable as long-term capital gains, regardless of how long the Shareholder has
held the Fund's Shares and are not eligible for the dividends-received
deduction.

The Tax-Free Bond Fund and the Tax-Free Money Market Fund intend to invest a
sufficient portion of their assets in state and municipal obligations so that
each will qualify to pay "exempt-interest dividends" to Shareholders. Such
exempt-interest dividends are excludable from a Shareholder's gross income for
federal income tax purposes. However, to the extent that a Fund's interest
income is attributable to certain so-called "private activity bonds," dividends
allocable to such income, while exempt from the regular federal income tax, will
constitute an item of tax preference for purposes of the alternative minimum
tax. Exempt-interest dividends are includable in the tax base for determining
the extent to which social security or railroad retirement benefits will be
subject to federal income tax. The Tax-Free Bond Fund and the Tax-Free Money
Market Fund may derive taxable investment income and realize capital gains or
losses from portfolio transactions, including the sale of securities;
distributions to Shareholders derived from such income and gains will be taxable
to the Shareholders.

Shareholders of the Tax-Free Bond Fund should be aware that redeeming shares
after tax-exempt interest income has been accrued by the Fund, but before that
income has been declared as a dividend, may be disadvantageous. This is because
the gain, if any, on the redemption will be taxable, even though such gain may
be attributable in part to the accrued tax-exempt interest which, if distributed
to the Shareholder as a dividend rather than as redemption proceeds might have
qualified as an exempt-interest dividend. Deductions for interest expense
incurred (or deemed to be incurred) to acquire or carry Shares of the Tax-Free
Bond Fund or the Tax-Free Money Market Fund may be subject to limitations that
reduce or eliminate such deductions.

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Free Bond Fund and the Tax-Free Money Market Fund should be aware that under the
laws of some state and local taxing authorities, distributions from the Funds
that are attributable to interest on state and municipal securities issued
within the Shareholder's own state may not be subject to state or local taxes.

Shareholders will be furnished annually with information relating to the
nature and amounts of distributions made by a Fund.

The proceeding discussion is only a summary of some of the federal tax
considerations generally affecting the Funds and their Shareholders and does not
address every possible situation. Distributions (including exempt-interest
dividends) may be subject to state, local and foreign taxes, and non-U.S.
Shareholders may be subject to U.S. tax rules that differ significantly from
those summarized herein. Persons who may be "substantial users" (or "related
persons" of substantial users) of facilities financed by private activity bonds
may suffer adverse tax consequences from investing in the Tax-Free Bond Fund and
the Tax-Free Money Market Fund. Prospective Shareholders should consult their
tax advisers with respect to the effect of investing in a Fund. For additional
information relating to taxes, see "ADDITIONAL INFORMATION-- Additional Tax
Information" in the Statement of Additional Information.

GENERAL INFORMATION

ORGANIZATION OF THE TRUST

The Trust was organized as a Massachusetts business trust in 1994 and consists
of eleven funds. The Shares of each of the Equity and Income Funds are offered
in three separate classes: Class A Shares, Class C Shares and Class Y Shares.
Shares of each of the Money Funds are also offered in three separate classes:
Class A Shares, Class Q Shares and Class Y Shares. Each Share represents an
equal proportionate interest in a fund with other Shares of the same fund, and
is entitled to such dividends and distributions out of the income earned on the
assets belonging to that fund as are declared at the discretion of the Trustees.
Shares are without par value. Shareholders are entitled to one vote for each
dollar of value invested and a proportionate fractional vote for any fraction of
a dollar invested. Shareholders will vote in the aggregate and not by fund
except as otherwise expressly required by law.

The Trust will call a special meeting of Shareholders for purposes of
considering the removal of one or more Trustees upon written request therefor
from Shareholders holding not less than

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10% of the outstanding votes of the Trust. At such a meeting, a quorum of
Shareholders (constituting a majority of votes attributable to all outstanding
Shares of the Trust), by majority vote, has the power to remove one or more
Trustees.

MULTIPLE CLASSES OF SHARES

In addition to Class Y Shares, the Trust also offers Class A Shares and Class
C Shares of the Equity and Income Funds. These two classes differ principally
with respect to sales charges and the rate of expenses to which they are
subject. The public offering price of Class A Shares of each Equity Fund is
equal to the net asset value per Share plus a sales charge equal to 4.50% of the
public offering price, reduced when the total purchase amount is $50,000 or
more. The public offering price of Class A Shares of each Income Fund is equal
to the net asset value per Share plus a sales charge equal to 3.50% of the
public offering price, reduced when the total purchase amount is $50,000 or
more. Under certain circumstances, the sales charge may be eliminated. The
public offering price of Class C Shares of each Equity and Income Fund is equal
to the net asset value per Share, but investors may be subject to a CDSC of
1.00% when Class C Shares are redeemed less than one year after purchase. The
Trust also offers Class A Shares of each of the Money Funds, which are sold to
the general public at net asset value per Share without a sales charge, as well
as Class Q Shares, which are sold at net asset value without a sales charge to
certain corporations, pension plans, foundations, charitable institutions,
certain large investors, insurance companies, banks and other banking
institutions, and non-bank fiduciaries. Class Y Shares are not sold subject to a
sales charge or CDSC and do not bear expenses under the Distribution and
Shareholder Service Plans pertaining to Class A, Class C and Class Q Shares. In
addition, Class A and Class C Shares may bear additional retail transfer agency
expenses. A salesperson or other person entitled to receive compensation for
selling or servicing the Class A, Class C or Class Q Shares may receive
different compensation with respect to one particular class of Shares over
another in the same Fund. For further details regarding Class A, Class C and
Class Q Shares, call the Trust at 1-800-743-8637 or your broker.

The amount of dividends payable with respect to Class Y Shares will exceed
dividends on Class A and Class C Shares as a result of the Distribution and
Shareholder Service Plan fees applicable to Class A and Class C Shares and
because such Shares may bear additional retail transfer agency expenses. The
amount of dividends payable with respect to Class Y Shares will also exceed
dividends on Class Q Shares as a result of the Distribution and Shareholder
Service Plan fees applicable to Class Q Shares.

PERFORMANCE INFORMATION

From time to time performance information for the Funds showing their average
annual total return, aggregate total return and/or yield may be presented in
advertisements, sales literature and Shareholder reports. In addition, tax
equivalent yield may be presented in advertisements, sales literature and
Shareholder reports of the Tax-Free Money Market Fund and Tax-Free Bond Fund.
Such performance figures are based on historical earnings and are not intended
to indicate future performance. Also, from time to time the Equity and Income
Funds may present their respective distribution rates for a class

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<PAGE>
of Shares in supplemental sales literature which is accompanied or preceded by a
prospectus and in Shareholder reports.

ACCOUNT SERVICES

Shareholders of the Trust may obtain current price, yield and other
performance information on the Funds 24 hours a day by calling 1-800-743-8637
from any touch-tone telephone.

MISCELLANEOUS

45
<PAGE>

SUBJECT TO COMPLETION: DATED ____________

QUALIVEST FUNDS

3435 Stelzer Road
Columbus, Ohio 43219-3035
1-800-743-8637

. Qualivest Large Companies Growth Fund; and
. Qualivest Micro Cap Value Fund.

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"), acts
as the investment adviser to each of the Funds.

The Trustees of the Trust have divided beneficial ownership of each fund
into transferable units called shares (the "Shares"). Each Fund offers
multiple classes of Shares. This Prospectus describes one class of Shares
of each Fund -- the Class Y Shares. Class Y Shares of the Funds are
currently offered only through trust departments of banks and other
institutional investors (including other mutual funds distributed by the
BISYS Group, Inc. and its affiliated companies) with account balances of
$1,000,000 or more that have entered into a separate agreement with the
Funds' distributor for monies that are held in a fiduciary, advisory,
agency, custodial, or similar capacity. Each of the Funds also offers
Class A Shares and Class C Shares to the general public. These classes of
Shares differ from each other, and from the Class Y Shares, principally
with respect to sales charges and the rate of expenses to which they are
subject. Interested persons who wish to obtain a copy of the Prospectus of
the Class A or Class C Shares of the Funds may contact the Trust at the
telephone number shown above.

Shares of the Funds are not deposits or obligations of, and are not
endorsed, insured or guaranteed by, any bank, the Federal Deposit Insurance
Corporation, or any other agency. An investment in the Funds involves
investment risk, including the possible loss of principal.

<PAGE>

This Prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Investors should read
this Prospectus and retain it for future reference.

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

The date of this Prospectus is ___________, 1996.

- 3 -

<PAGE>

TABLE OF CONTENTS

Page
----

PROSPECTUS SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . .
Shares Offered . . . . . . . . . . . . . . . . . . . . . . . . . .
Offering Price and Sales Charges . . . . . . . . . . . . . . . . .
Investment Objectives . . . . . . . . . . . . . . . . . . . . . .
Investment Policies . . . . . . . . . . . . . . . . . . . . . . .
Risk Factors and Special Considerations . . . . . . . . . . . . .
Investment Adviser . . . . . . . . . . . . . . . . . . . . . . . .
Dividends and Capital Gains . . . . . . . . . . . . . . . . . . .
Other Information . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

FUND EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

FEE TABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . . . .
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

VALUATION OF SHARES . . . . . . . . . . . . . . . . . . . . . . . . . .

- 4 -

<PAGE>

PURCHASING SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Information Regarding Purchases . . . . . . . . . . . . . .
Exchange Privilege . . . . . . . . . . . . . . . . . . . . . . . .

REDEEMING SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Mail . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
By Telephone . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Information Regarding Redemption of Shares . . . . . . . . .

DIVIDENDS AND TAXES . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal Taxes . . . . . . . . . . . . . . . . . . . . . . . . . .

GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . .
Organization of the Trust . . . . . . . . . . . . . . . . . . . .
Multiple Classes of Shares . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Performance Information . . . . . . . . . . . . . . . . . . . . .
Account Services . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . .

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<PAGE>

PROSPECTUS SUMMARY

Shares Offered

Class Y Shares of the Qualivest Large Companies Growth Fund (the "Large
Companies Growth Fund") and the Qualivest Micro Cap Value Fund (the "Micro
Cap Fund") (collectively, the "Funds"), which are two separate diversified
investment portfolios ("funds") of Qualivest Funds, a Massachusetts
business trust (the "Trust") which is registered as an open-end management
investment company.

Offering Price and Sales Charges

The public offering price of Class Y Shares of each Fund is equal to the
net asset value per Share with no sales charge and no contingent deferred
sales charge ("CDSC") imposed on redemptions. Class Y Shares are offered
only through trust departments of banks and other institutional investors
for monies that are held in a fiduciary, agency, custodial, or similar
capacity.

Investment Objectives

The Large Companies Growth Fund seeks long-term capital appreciation.
- -------------------------------

The Micro Cap Fund seeks capital appreciation.
- ------------------

Investment Policies

Risk Factors and Special Considerations

- 6 -

<PAGE>

Investment Adviser

Dividends and Capital Gains

Dividends from net income are declared and paid quarterly for the Funds.
Net realized capital gains are distributed at least annually.

Other Information

FUND EXPENSES

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<PAGE>

FEE TABLE

Qualivest Large Qualivest Micro
Companies Growth Fund Cap Value Fund
--------------------- ---------------

Shareholder Transaction Expenses

Maximum Sales Charge Imposed on
Purchases (as a percentage
of offering price) . . None None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price) None None
Deferred Sales Charge (as a
percentage of redemption
proceeds) . . . . . . . None None
Redemption Fees (as a percentage
of redemption proceeds) None None
Exchange Fees . . . . . None None

Annual Fund Operating Expenses
(as a percentage of average
net assets annualized)
Management Fees After Waiver1 ____% ____%
12b-1 Fees . . . . . . . None None
Other Expenses . . . . . ____% ____%

Total Fund Operating Expenses After
Waiver2 . . . . ____% ____%

____________________

1 Qualivest has agreed to temporarily waive a portion of its investment
advisory fee for the Funds for the current fiscal year. Waived fees
cannot be recovered at a future date. Absent the advisory fee
waiver, "Management Fees" as a percentage of average daily net assets
would be ____% for the Large Companies Growth Fund and ____% for the
Micro Cap Fund. See "MANAGEMENT OF THE FUNDS -- Investment Adviser."

2 Absent the waiver of the investment advisory fee, "Total Fund
Operating Expenses" as a percentage of average daily net assets would
be ____% for the Large Companies Growth Fund and ____% for the Micro
Cap Fund.

The purpose of this table is to assist the prospective investor in
understanding the various costs and expenses that a Shareholder in the
Funds will bear.

Example*

An investor would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return, and (2) redemption at the end of each time
period:

Qualivest
Qualivest Large Micro Cap
Companies Growth Fund Value Fund
--------------------- ----------

1 Year . . . . . . $ __ $ __
3 Years . . . . . . $ __ $ __

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

- 8 -

<PAGE>

* This example should not be considered a representation of future
expenses, which may be more than those shown. The assumed 5% annual
return is hypothetical and should not be considered a representation
of past or future annual return. Actual return may be greater or less
than the assumed amount.

INVESTMENT OBJECTIVES AND POLICIES

The Large Companies Growth Fund maintains a flexible investment approach
and considers a variety of companies and types of securities, depending on
the economic environment and the relative attractiveness of the various
securities markets. The Fund generally seeks to invest in financially
secure firms with established operating histories that are proven leaders
in their industry or market sector. Such companies may demonstrate
characteristics such as participation in expanding markets, increasing unit
sales volume, growth in revenues and earnings per share, and increasing
return on investments. However, Qualivest may invest the Fund's assets in
companies that do not demonstrate such characteristics if Qualivest expects
such companies to undergo an acceleration in growth of earnings because of
special factors such as new management, new products, changes in consumer
demand or basic changes in the economic environment.

- 9 -
<PAGE>

The Micro Cap Fund seeks to achieve its investment objective by following
flexible investment policies emphasizing investment in common stocks and
securities convertible into common stocks that are, in Qualivest's opinion,
undervalued relative to other securities at the time of purchase. In
analyzing different securities, Qualivest will consider ratios of market
price to book value, ratios of market price to earnings, ratios of market
price to assets, estimated liquidating value, earnings growth rate,
management strength, and cash flow as significant factors in assessing
relative value. If in Qualivest's opinion a stock has reached a fully
valued position, it will, under most circumstances, be sold and replaced by
securities which are deemed to be undervalued in the marketplace.

General

- 10 -

<PAGE>

capitalization companies and micro capitalization companies, respectively.
Qualivest will attempt to make such sales when market conditions are
favorable.

- 11 -

<PAGE>

* * * *

INVESTMENT TECHNIQUES AND RISK FACTORS

Like any investment program, an investment in a Fund entails certain risks.

Micro Capitalization Securities

The Micro Cap Fund may invest in common stocks and securities convertible
into common stocks of companies with market capitalization that is low
compared to other publicly traded companies. Investments in larger
companies present certain advantages, in that such companies generally have
greater financial resources, more extensive research and development,
manufacturing, marketing and service capabilities, and more stability and
greater depth of management and technical personnel. Investments in
smaller, less seasoned companies may present greater opportunities for
growth but also may involve greater risks than customarily are associated
with more established companies. The securities of micro capitalization
companies may be subject to more abrupt or

- 12 -

<PAGE>

erratic market movements than larger, more established companies. These
companies may have limited product lines, markets or financial resources,
or they may be dependent upon a limited management group. Their securities
may be traded only in the over-the-counter market or on a regional
securities exchange. As a result, the disposition of securities to meet
redemptions may require the Micro Cap Fund to sell these securities at a
disadvantageous time, or at disadvantageous prices, or to make many small
sales over a lengthy period of time.

Put and Call Options

A Fund, as part of its option transactions, also may purchase index put and
call options and write index options. As with options on individual
securities, a Fund will write only covered index call options. Options on
securities indices are similar to options on a security except that, rather
than the right to take or make delivery of a security at a specified price,
an option on a securities index gives the holder the right to receive, upon
exercise of the option, an amount of cash if the closing level of

- 13 -

<PAGE>

the securities index upon which the option is based is greater than, in the
case of a call, or less than, in the case of a put, the exercise price of
the option.

Price movements in securities which a Fund owns or intends to purchase may
not correlate perfectly with movements in the level of an index and,
therefore, a Fund bears the risk of a loss on an index option that is not
completely offset by movements in the price of such securities. Because
index options are settled in cash, a call writer cannot determine the
amount of its settlement obligations in advance and, unlike call writing on
specific securities, cannot provide in advance for, or cover, its potential
settlement obligations by acquiring and holding the underlying securities.
A Fund may be required to segregate assets or provide an initial margin to
cover index options that would require it to pay cash upon exercise.

Foreign Securities

Investment in foreign securities is subject to special investment risks
that differ in some respects from those related to investments in
securities of U.S. domestic issuers. Such risks include political, social
or economic instability in the country of the issuer, the difficulty of
predicting international trade patterns, the possibility of the imposition
of exchange controls, expropriation, limits on removal of currency or other
assets, nationalization of assets, foreign withholding and income taxation,
and foreign trading practices (including higher trading commissions,
custodial charges and delayed settlements). Such securities may be subject
to greater fluctuations in price than securities issued by U.S.
corporations or issued or guaranteed by the U.S. Government, its agencies
or instrumentalities. The markets on which such securities trade may have
less volume and liquidity, and may be more volatile than securities markets
in the U.S. In addition, there may be less publicly available information
about a foreign company than about a U.S. domiciled company. Foreign
companies generally are not subject to uniform accounting, auditing and
financial reporting standards comparable to those applicable to U.S.
domestic companies. There is generally less government regulation of
securities exchanges, brokers and listed companies abroad than in the U.S.
Confiscatory taxation or diplomatic developments could also affect
investment in those countries. In addition, foreign branches of U.S.
banks, foreign banks and foreign issuers may be subject to less stringent
reserve

- 14 -

<PAGE>

requirements and to different accounting, auditing, reporting, and
recordkeeping standards than those applicable to domestic branches of U.S.
banks and U.S. domestic issuers.

If a security is denominated in foreign currency, the value of the security
to a Fund will be affected by changes in currency exchange rates and in
exchange control regulations, and costs will be incurred in connection with
conversions between currencies. Currency risks generally increase in
lesser developed markets. Exchange rate movements can be large and can
endure for extended periods of time, affecting either favorably or
unfavorably the value of a Fund's assets.

For many foreign securities, U.S. dollar denominated American Depositary
Receipts ("ADRs"), which are traded in the United States on exchanges or
over-the-counter, are issued by domestic banks. ADRs represent the right
to receive securities of foreign issuers deposited in a domestic bank or a
correspondent bank. ADRs do not eliminate all the risk inherent in
investing in the securities of foreign issuers. However, by investing in
ADRs rather than directly in foreign issuers' stock, a Fund can avoid
currency risks during the settlement period for either purchases or sales.

Foreign Currency Transactions

- 15 -

<PAGE>

involves an obligation to purchase or sell a specific currency at a future
date at a price set at the time of the contract. The Funds may enter into
forward currency contracts in order to hedge against adverse movements in
exchange rates between currencies. However, this tends to limit potential
gains which might result from a positive change in such currency
relationships. A Fund may also hedge its foreign currency exchange rate
risk by engaging in currency financial futures and options transactions.
The forecasting of short-term currency market movements is extremely
difficult and whether such a short-term hedging strategy will be successful
is highly uncertain.

If a Fund retains the portfolio security and engages in an offsetting
transaction, it will incur a gain or a loss to the extent that there has
been movement in forward currency contract prices. If a Fund engages in an
offsetting transaction, it may subsequently enter into a new forward
currency contract to sell the foreign currency. Although such contracts
tend to minimize the risk of loss due to a decline in the value of the
hedged currency, they also tend to limit any potential gain which might
result should the value of such currency increase. The Funds will have to
convert their holdings of foreign currencies into U.S. dollars from time to
time. Although foreign exchange dealers do not charge a fee for
conversion, they do realize a profit based on the difference (the "spread")
between the prices at which they are buying and selling various currencies.

Futures Contracts

The Funds also may enter into contracts for the future delivery of
securities or foreign currencies and futures contracts based on a specific
security, class of securities, foreign currency or an

- 16 -

<PAGE>

index, purchase or sell options on any such futures contracts and engage in
related closing transactions. A futures contract on a securities index is
an agreement obligating either party to pay, and entitling the other party
to receive, while the contract is outstanding, cash payments based on the
level of a specified securities index. A Fund may engage in such futures
contracts in an effort to hedge against market risks and to manage its cash
position, but not for leveraging purposes.

Aggregate initial margin deposits for futures contracts, and premiums paid
for related options, may not exceed 5% of a Fund's total assets, and the
value of securities that are the subject of such futures and options (both
for receipt and delivery) may not exceed 33 1/3% of the market value of a
Fund's total assets. Futures transactions will be limited to the extent
necessary to maintain each Fund's qualification as a regulated investment
company.

When-Issued and Delayed-Delivery Transactions

Lending of Portfolio Securities

- 17 -

<PAGE>

collateral must be valued daily by Qualivest and, should the market value
of the loaned securities increase, the borrower must furnish additional
collateral to the Funds. During the time portfolio securities are on loan,
the borrower pays the Funds any dividends or interest paid on such
securities. Loans are subject to termination by the Funds or the borrower
at any time. While the Funds do not have the right to vote securities on
loan, they intend to terminate the loan and regain the right to vote if
that is considered important with respect to the investment. In the event
the borrower defaults on its obligation to a Fund, the Fund could
experience delays in recovering its securities and possible capital losses.
The Funds will only enter into loan arrangements with broker-dealers, banks
or other institutions which Qualivest has determined to be creditworthy
under guidelines established by the Board of Trustees that permit each Fund
to loan up to 33 1/3% of the value of its total assets.

Repurchase Agreements

Reverse Repurchase Agreements and Dollar Roll Agreements

- 18 -

<PAGE>

account assets such as U.S. Government securities or other liquid high
grade debt securities consistent with its investment restrictions having a
value equal to the repurchase price (including accrued interest), and will
subsequently continually monitor the account to ensure that such equivalent
value is maintained at all times. Reverse repurchase agreements and dollar
roll agreements involve the risk that the market value of securities sold
by a Fund may decline below the price at which it is obligated to
repurchase the securities.

Mortgage-Related and Asset-Backed Securities

Like mortgages underlying mortgage-backed securities, automobile sales
contracts or credit card receivables underlying asset-backed securities are
subject to prepayment, which may reduce the overall return to certificate
holders. Nevertheless, principal prepayment rates tend not to vary much
with interest rates, and the short-term nature of the underlying car loans
or other receivables tends to dampen the impact of any change in the
prepayment level. Certificate holders may also experience delays in
prepayment on the certificates if the full amounts due on underlying sales
contracts or receivables are not realized because of unanticipated legal or
administrative costs of enforcing the contracts or because of depreciation
or damage to the collateral (usually automobiles)

- 19 -

<PAGE>

securing certain contracts, or other factors. In certain market
conditions, asset-backed securities may experience volatile fluctuations in
value and periods of illiquidity. If consistent with its investment
objective and policies, a Fund may invest in other asset-backed securities
that may be developed in the future.

The staff of the Securities and Exchange Commission is of the view that
certain issuers of asset-backed securities not complying with Securities
and Exchange Commission regulations are investment companies under the
Investment Company Act of 1940 (the "1940 Act"). The Funds intend to
conduct their operations in a manner consistent with this view and, among
other things, generally will not invest more than 10% of their total assets
(when combined with investments in securities of other investment
companies, if any) in the obligations of such issuers without obtaining
appropriate regulatory relief.

Medium-Grade Securities

Should subsequent events cause the rating of a debt security purchased by a
Fund to fall below BBB or Baa, as the case may be, Qualivest will consider
such an event in determining whether the Fund should continue to hold that
security. In no event, however, would a Fund be required to liquidate any
such portfolio security where the Fund would suffer a loss on the sale of
such security.

U.S. Government Securities

- 20 -

<PAGE>

obligations; and still others are supported only by the credit of the
instrumentality. No assurance can be given that the U.S. Government would
provide financial support to U.S. Government-sponsored agencies or
instrumentalities if it is not obligated to do so by law.

Bankers' Acceptances

The Funds may invest in bankers' acceptances guaranteed by domestic and
foreign banks if at the time of investment the guarantor bank has capital,
surplus, and undivided profits in excess of $100,000,000 (as of the date of
its most recently published financial statements).

Certificates of Deposit and Time Deposits

The Funds may invest in certificates of deposit and time deposits of
domestic and foreign banks and savings and loan associations if (a) at the
time of investment the depository institution has capital, surplus, and
undivided profits in excess of $100,000,000 (as of the date of its most
recently published financial statements), or (b) the principal amount of
the instrument is insured in full by the Federal Deposit Insurance
Corporation.

Commercial Paper

- 21 -

<PAGE>

issued by a Canadian corporation or a Canadian counterpart of a U.S.
corporation, and in Europaper, which is U.S. dollar denominated commercial
paper of a foreign issuer.

Securities Issued by Other Investment Companies

Restricted Securities

- 22 -

<PAGE>

adopted by the Board of Trustees of the Trust, Qualivest may determine
Section 4(2) securities to be liquid if such securities are readily
marketable. These securities may include securities eligible for resale
under Rule 144A under the 1933 Act.

VALUATION OF SHARES

Net asset value per Share for a particular class for purposes of pricing
sales and redemptions is calculated by dividing the value of all securities
and other assets belonging to a Fund allocable to such class, less the
liabilities charged to that Fund allocable to such class and any
liabilities charged directly to that class, by the number of outstanding
Shares of such class.

The net asset value per Share of the Funds will fluctuate as the value of
the investment portfolio of a Fund changes.

PURCHASING SHARES

Class Y Shares may be purchased through a broker-dealer, bank, or trust
company that has established a dealer agreement with the Distributor.
Class Y Shares of each Fund are continuously offered

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<PAGE>

and also may be purchased directly either by mail, by telephone, or by
wire.

An Account Application Form can be obtained by calling the Trust at 1-800-
743-8637.

Other Information Regarding Purchases

Purchases of Class Y Shares of the Funds will be executed at the next
calculated net asset value per Share following the receipt by the Trust of
an order to purchase Class Y Shares in good form ("public offering price").
In the case of orders for the purchase of Class Y Shares placed through a
broker-dealer, the applicable public offering price will be the net asset
value as so determined, but only if the Distributor receives the order
prior to the Valuation Time for that day and transmits it to the Trust by
that Valuation Time. The broker-dealer is responsible for transmitting
such orders promptly. If the broker-dealer fails to do so, the investor's
right to that day's closing price must be settled between the investor and
the broker-dealer. Purchases of Class Y Shares of any of the Funds will be
effected only on a Business Day of the Funds. An order received prior to
the Valuation Time on any Business Day will be executed at the net asset
value determined as of the Valuation Time on the date of receipt. An order
received after the Valuation Time on any Business Day will be executed at
the net asset value determined as of the Valuation Time on the next
Business Day of that Fund.

The Trust reserves the right to reject any order for the purchase of its
Shares in whole or in part, including purchases made through the use of
third party checks and drafts drawn on foreign financial institutions.

Every Shareholder will receive a confirmation of, or account statement
reflecting, each new transaction in the Shareholder's account, which will
also show the total number of Class Y Shares of the respective Fund owned
by the Shareholder. Shareholders may rely on these statements in lieu of
certificates. Certificates representing Class Y Shares of the Funds will
not be issued.

- 24 -

<PAGE>

Exchange Privilege

The exchange privilege enables Shareholders of Class Y Shares of a Fund
(including Class Y Shares acquired through reinvestment of dividends and
distributions on such Shares) to acquire at net asset value Class Y Shares
offered by another fund of the Trust. Holders of Class Y Shares may not
exchange their Shares for Shares of any other class, and holders of Shares
of any other class may not exchange their Shares for Class Y Shares.

An exchange is considered a sale of Shares and may result in a capital gain
or loss for federal income tax purposes.

A Shareholder wishing to exchange his or her Shares may do so by contacting
the Custodian or an affiliate. Any Shareholder who wishes to make an
exchange should obtain and review the current prospectus of the fund to be
acquired before making the exchange. For a discussion of risks associated
with unauthorized telephone exchanges, see "REDEEMING SHARES -- By
Telephone" below.

REDEEMING SHARES

Shareholders may redeem their Class Y Shares without charge on any day that
net asset value is calculated (see "VALUATION OF SHARES"). Redemptions
will be effected at the net asset value per Share next determined after
receipt by the Distributor of a redemption request. Redemptions may be
requested by mail or by telephone.

By Mail

A written request for redemption must be received by the Distributor in
order to honor the request. The Distributor's address is: BISYS Fund
Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035. The Transfer Agent
will require a signature guarantee by an eligible guarantor institution.
The signature guarantee requirement will be waived if all of the following
conditions apply: (1) the redemption check is payable to the Shareholder(s)
of record, and (2) the redemption check is mailed to the Shareholder(s) at
the address of record. The Shareholder may also have the proceeds mailed
to a commercial bank account previously designated on the Account
Application Form. There is no charge for having redemption proceeds mailed
to a designated bank account. To change the address to which a redemption
check is to be mailed, a written request therefor must be received by the
Transfer Agent.

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<PAGE>

In connection with such request, the Transfer Agent will require a
signature guarantee by an eligible guarantor institution.

For purposes of this policy, the term "eligible guarantor institution"
shall include banks, brokers, dealers, credit unions, securities exchanges
and associations, clearing agencies and savings associations as those terms
are defined in the Securities Exchange Act of 1934. The Transfer Agent
reserves the right to reject any signature guarantee if (1) it has reason
to believe that the signature is not genuine, (2) it has reason to believe
that the transaction would otherwise be improper, or (3) the guarantor
institution is a broker or dealer that is neither a member of a clearing
corporation nor maintains net capital of at least $100,000.

By Telephone

Class Y Shares may be redeemed by telephone if the Account Application Form
reflects that the Shareholder has elected that privilege. If the telephone
feature was not originally selected, the Shareholder must provide written
instructions to the Trust to add it. The Shareholder may have the proceeds
mailed to the Shareholder's address or mailed or wired to a commercial bank
account previously designated on the Account Application Form. Under most
circumstances, payments will be transmitted on the next Business Day. Wire
redemption requests may be made by the Shareholder by telephone to the
Trust at 1-800-743-8637. While the Transfer Agent currently does not
charge a wire redemption fee, the Transfer Agent reserves the right to
impose such a fee in the future.

The Trust's Account Application Form provides that none of BISYS, the
Transfer Agent, Qualivest, the Trust or any of their affiliates or agents
will be liable for any loss, expense or cost when acting upon any oral,
wired or electronically transmitted instructions or inquiries believed by
them to be genuine. While precautions will be taken, as more fully
described below, Shareholders bear the risk of any loss as the result of
unauthorized telephone redemptions or exchanges believed by the Transfer
Agent to be genuine. The Trust will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine. These
procedures include recording all phone conversions, sending confirmations
to Shareholders within 72 hours of the telephone transaction, verifying the
account name and a Shareholder's account number or

- 26 -

<PAGE>

tax identification number and sending redemption proceeds only to the
address of record or to a previously authorized bank account. If a
Shareholder is unable to contact the Funds by telephone, a Shareholder may
also mail the redemption request to the Distributor at the address above.

Other Information Regarding Redemption of Shares

All redemption orders are effected at the net asset value per Share next
determined after the Class Y Shares are properly tendered for redemption,
as described above. The proceeds paid upon redemption of Class Y Shares in
the Funds may be more or less than the amount invested. Payment to
Shareholders for Shares redeemed will be made within seven days after
receipt of the request for redemption, or within such shorter period as
required by law. To the greatest extent possible, requests from
Shareholders of a Fund for next Business Day payments upon redemption of
Shares will be honored if received by the Distributor before the Valuation
Time on a Business Day or, if received after the Valuation Time, within two
Business Days, unless it would be disadvantageous to that Fund or its
Shareholders to sell or liquidate portfolio securities in an amount
sufficient to satisfy requests for payments in that manner.

See the Statement of Additional Information ("ADDITIONAL PURCHASE AND
REDEMPTION INFORMATION") for examples of when the right of redemption may
be suspended.

MANAGEMENT OF THE FUNDS

Trustees

- 27 -

<PAGE>

are not "interested persons" of the Trust within the meaning of that term
under the 1940 Act. The Trustees, in turn, elect the officers of the Trust
to supervise its day-to-day operations. The Trustees of the Trust are:
George R. Landreth, David F. Jones, John W. Judy, Raymond H. Lung, Mary
Anne Houlahan and David B. Frohnmayer.

Investment Adviser

Qualivest Capital Management, Inc., 111 S.W. Fifth Avenue, Portland, Oregon
97204, is the investment adviser of the Trust. Qualivest, a registered
investment adviser, is an affiliate of U.S. Bank, which is a wholly owned
subsidiary of U.S. Bancorp. U.S. Bancorp is a super-regional financial
services holding company organized under the laws of Oregon in 1968. U.S.
Bank, headquartered in Portland, is a national banking association
chartered in 1891. It offers a wide variety of full-service and commercial
banking operations in over 200 locations in Oregon. Other services of U.S.
Bancorp and its subsidiaries include mortgage banking, lease financing,
consumer financing, commercial finance, international banking, investment
advisory, insurance agency and credit life insurance services, brokerage
and venture capital. As of January 1, 1996, Qualivest had under management
nearly $8.0 billion in assets. It also is investment adviser to Tax-Free
Trust of Oregon, a tax-free municipal bond fund, whose assets were
approximately $310 million at that date.

Michael Cusack is the Equity Manager primarily responsible for managing the
Large Companies Growth Fund. [INSERT RE CUSACK'S BUSINESS EXPERIENCE]

- 28 -

<PAGE>

University and a Doctorate in History from the University of Maine. Mr.
Benson is also a Chartered Financial Analyst. [INSERT RE MAGDLEN'S
BUSINESS EXPERIENCE]

Administrator and Distributor

BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035, a
division of BISYS Group, Inc., is the administrator for each fund of the
Trust, and also acts as the Trust's principal underwriter and distributor.

The Administrator generally assists in all aspects of the Funds'
administration and operation. For expenses assumed and services provided
as administrator pursuant to its Management and Administration Agreement
with the Trust, the Administrator receives a fee from each Fund equal to
the lesser of a fee, computed daily and paid periodically, at an annual
rate of 0.13% of the Fund's average daily net assets, or such other fee as
may be agreed upon from time to time by the Trust and the Administrator.
The Administrator may periodically voluntarily reduce all or a portion of
its administrative fee with respect to a Fund to increase the net income of
that Fund available for distribution as dividends. The voluntary fee
reduction will cause the return of that Fund to be higher than it would
otherwise be in the absence of such reduction.

The Distributor acts as agent for the Funds in the distribution of their
Shares and, in such capacity, solicits orders for the sale of

- 29 -

<PAGE>

Shares, advertises, and pays the cost of advertising, office space and its
personnel involved in such activities. Under its Distribution Agreement
with the Trust, the Distributor may retain some or all of any sales charge
imposed upon the Class A or Class C Shares. It may also receive
compensation under the Distribution and Shareholder Service Plans regarding
the Class A and Class C Shares.

Other Service Providers

BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-
3035, serves as the Trust's transfer agent and dividend disbursing agent
pursuant to a Transfer Agency Agreement with the Trust and receives a fee
for such services. BISYS Fund Services Ohio, Inc. also provides certain
accounting services for each of the Funds and receives a fee for such
services. Deloitte & Touche LLP serves as independent auditors for the
Trust. United States National Bank of Oregon is the custodian of the
Funds. See "MANAGEMENT OF THE TRUST" in the Statement of Additional
Information for further information.

Expenses

- 30 -

<PAGE>

Shareholders' reports and meetings, and any extraordinary expenses incurred
in each Fund's operation.

As a general matter, expenses are allocated to the Class A, Class C and
Class Y Shares of the Funds on the basis of the relative net asset value of
each class. Class A and Class C Shares may bear certain additional retail
transfer agency expenses. Class A and Class C Shares also bear certain
additional Shareholder service and distribution costs incurred pursuant to
the Distribution and Shareholder Service Plans.

The Trustees reserve the right, subject to the receipt of relevant
regulatory approvals or rulings, if needed, to allocate certain other
expenses to the Shareholders of a particular class, including Class Y
Shares, on a basis other than relative net asset value, as they deem
appropriate ("Class Expenses"). In such event, Class Expenses would be
limited to: transfer agency fees identified by the Transfer Agent as
attributable to a specific class; printing and postage expenses related to
preparing and distributing materials such as Shareholder reports,
prospectuses and proxies to current Shareholders; Blue Sky registration
fees incurred by a class of Shares; Securities and Exchange Commission
registration fees incurred by a class of Shares; expenses related to
administrative personnel and services as required to support the
Shareholders of a specific class; litigation or other legal expenses
relating solely to one class of Shares; and Trustees' fees incurred as a
result of issues relating solely to one class of Shares.

Portfolio Transactions

Pursuant to the Investment Advisory Agreement, Qualivest places orders for
the purchase and sale of portfolio investments for the Funds' accounts with
brokers or dealers it selects in its discretion. Broker-dealers selected
to execute portfolio transactions for the Funds may include affiliates of
the Trust, Qualivest or BISYS, provided the charge for any such transaction
does not exceed usual and customary levels.

Banking Laws

Federal banking laws and regulations presently prohibit a national bank or
any affiliate thereof from sponsoring, organizing or controlling a
registered open-end investment company continuously

- 31 -

<PAGE>

engaged in the issuance of its shares, and generally from underwriting,
selling or distributing securities, such as Shares of the Funds.

Qualivest is a subsidiary of U.S. Bank, and it and U.S. Bank are affiliates
of a bank holding company. They are therefore subject to applicable
federal banking laws and regulations. Qualivest has been advised by its
counsel that it may perform the advisory services for the Funds required by
the Investment Advisory Agreement and, provided that they do not engage in
underwriting, selling or distribution of the Funds' Shares, Qualivest's
national bank affiliates may perform shareholder servicing activities and
may receive compensation without violating federal banking laws and
regulations.

In the event that, due to future events, Qualivest is prohibited from
acting as the Funds' investment adviser, it is probable that the Board of
Trustees would either recommend to Shareholders the selection of another
qualified adviser or, if that course of action appeared impractical, that
the Funds be liquidated.

Participating Organizations

The Distributor may enter into agreements with banks and their affiliates
(including U.S. Bank and its affiliates), and other institutions, including
broker-dealers (each a "Participating Organization"), for providing
Shareholder services with respect to the Class Y Shares. Such
Participating Organizations will be compensated at the annual rate of up to
0.25% of the average daily net assets of the Class Y Shares held of record
or beneficially by customers of Participating Organizations who are record
or beneficial owners of Class Y Shares. The Trust understands that
Participating Organizations may charge fees to their customers who are the
owners of Class Y Shares for additional services provided in connection
with their customer accounts. These fees would be in addition to any
amounts which may be received by a Participating Organization under its
agreement with BISYS. Customers of Participating Organizations should read
this Prospectus in light of the terms governing their accounts with their
Participating Organizations.

The Shareholder services provided by Participating Organizations for which
the fee may be paid may include providing information periodically to
customers, including information showing their

- 32 -

<PAGE>

positions in Class Y Shares; responding to inquiries from customers
concerning their investment in Class Y Shares; providing sub-accounting
with respect to Class Y Shares beneficially owned by customers or the
information necessary for sub-accounting; arranging for bank wires; and
other continuing personal services to holders of Class Y Shares.

DIVIDENDS AND TAXES

Dividends

Net income is declared quarterly as a dividend to Shareholders of record of
the Funds at the close of business on the eleventh Business Day of each
Fund's fiscal quarter and is generally paid quarterly. Distributable net
realized capital gains are distributed at least annually. A Shareholder
will automatically receive all income dividends and capital gains
distributions in additional full and fractional Shares at net asset value
as of the date of declaration, unless the Shareholder elects to receive
dividends or distributions in cash. Such election, or any revocation
thereof, must be made in writing to the Transfer Agent at 3435 Stelzer
Road, Columbus, Ohio 43219-3035, and will become effective with respect to
dividends and distributions having record dates after its receipt by the
Transfer Agent.

Federal Taxes

Each Fund intends to qualify annually and elect to be treated as a
regulated investment company under the Internal Revenue Code of 1986, as
amended (the "Code"), so that it generally will not be subject to federal
income tax on its taxable income and gains that are distributed to
Shareholders. In order to avoid a 4% federal excise tax, each Fund intends
to distribute each calendar year substantially all of its taxable income
and gains.

- 33 -

<PAGE>

deduction. Distributions of net capital gains (the excess of net long-term
capital gains over net short-term capital losses), if any, designated by a
Fund as capital gain dividends, are taxable as long-term capital gains,
regardless of how long the Shareholder has held the Fund's Shares and are
not eligible for the dividends-received deduction.

Certain dividends declared by a Fund in October, November or December and
paid during the following January will be treated as having been received
by Shareholders on December 31 in the year the distributions were declared.
Reinvested distributions will be taxable as if they had been received in
cash.

Each Fund may be required to withhold federal income tax at the rate of 31%
of all taxable distributions paid to Shareholders who fail to provide a
Fund with their correct taxpayer identification number or to make required
certifications or who have been notified by the Internal Revenue Service
("IRS") that they are subject to backup withholding. Corporate
Shareholders and certain other Shareholders specified in the Code are
exempt from backup withholding. Backup withholding is not an additional
tax and any amounts withheld may be credited against the Shareholder's
federal income tax liability.

Shareholders will be furnished annually with information relating to the
nature and amounts of distributions made by a Fund.

The proceeding discussion is only a summary of some of the federal tax
considerations generally affecting the Funds and their

- 34 -

<PAGE>

Shareholders and does not address every possible situation. Distributions
(including exempt-interest dividends) may be subject to state, local and
foreign taxes, and non-U.S. Shareholders may be subject to U.S. tax rules
that differ significantly from those summarized herein. Prospective
Shareholders should consult their tax advisers with respect to the effect
of investing in a Fund. For additional information relating to taxes, see
"ADDITIONAL INFORMATION--Additional Tax Information" in the Statement of
Additional Information.

GENERAL INFORMATION

Organization of the Trust

An annual or special meeting of Shareholders to conduct necessary business
is not required by the Trust's Declaration of Trust, the 1940 Act or other
authority except, under certain circumstances, to elect Trustees, amend the
Declaration of Trust, approve an investment advisory agreement and to
satisfy certain other requirements. To the extent that such a meeting is
not required, the Trust may elect not to have an annual or special meeting.

The Trust will call a special meeting of Shareholders for purposes of
considering the removal of one or more Trustees upon written request
therefor from Shareholders holding not less than 10% of the outstanding
votes of the Trust. At such a meeting, a quorum of Shareholders
(constituting a majority of votes attributable to all outstanding Shares of
the Trust), by majority vote, has the power to remove one or more Trustees.

- 35 -

<PAGE>

Multiple Classes of Shares

In addition to Class Y Shares, the Trust also offers Class A Shares and
Class C Shares of the Funds. These two classes differ principally with
respect to sales charges and the rate of expenses to which they are
subject. Class Y Shares are not sold subject to a sales charge or CDSC and
do not bear expenses under the Distribution and Shareholder Service Plans
pertaining to Class A and Class C Shares. The amount of dividends payable
with respect to Class Y Shares will exceed dividends on Class A and Class C
Shares as a result of the Distribution and Shareholder Service Plan fees
applicable to Class A and Class C Shares and because such Shares may bear
additional retail transfer agency expenses. For further details regarding
Class A and Class C Shares, call the Trust at 1-800-743-8637 or your
broker.

Each Fund intends to seek a ruling from the IRS to the effect that
differing distributions among the classes of its Shares will not result in
the Fund's dividends or other distributions being regarded as "preferential
dividends" under the Code. While similar rulings have been issued by the
IRS, complete assurance cannot, of course, be given that the Funds will
receive such rulings. For additional information, see the Statement of
Additional Information.

Performance Information

From time to time performance information for the Funds showing their
average annual total return, aggregate total return and/or yield may be
presented in advertisements, sales literature and Shareholder reports.
Such performance figures are based on historical earnings and are not
intended to indicate future performance. Also, from time to time the Funds
may present their respective distribution rates for a class of Shares in
supplemental sales literature which is accompanied or preceded by a
prospectus and in Shareholder reports.

- 36 -

<PAGE>

Investors may also judge the performance of any class of Shares or Fund by
comparing or referencing it to the performance of other mutual funds with
comparable investment objectives and policies through various mutual fund
or market indices such as those prepared by various services, which indices
may be published by such services or by other services or publications,
including, but not limited to, ratings published by Morningstar, Inc. In
addition to performance information, general information about the Funds
that appears in such publications may be included in advertisements, in
sales literature and in reports to Shareholders. For further information
regarding such services and publications, see "ADDITIONAL INFORMATION --
Performance Comparisons" in the Statement of Additional Information.

Total return and yield are functions of the type and quality of instruments
held in the portfolio, operating expenses, and market conditions. Any fees
charged with respect to customer accounts for investing in Shares of the
Funds will not be included in performance calculations; such fees, if
charged, will reduce the actual performance from that quoted. In addition,
if Qualivest and BISYS voluntarily reduce all or a part of their respective
fees, the total return of such Fund will be higher than it would otherwise
be in the absence of such voluntary fee reductions.

Account Services

Shareholders of the Trust may obtain current price, yield and other
performance information on the Funds or any of the Trust's funds 24 hours a
day by calling 1-800-743-8637 from any touch-tone telephone.

Miscellaneous

Shareholders will receive unaudited semi-annual reports and annual reports
audited by independent public accountants. Inquiries regarding the Trust
may be directed in writing to Qualivest Funds at 3435 Stelzer Road,
Columbus, Ohio 43219-3035, or by calling toll free 1-800-743-8637.

No person has been authorized to give any information or to make any
representations not contained in this Prospectus 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 by their Distributor in any jurisdiction in which
such offering may not lawfully be made.

- 37 -

<PAGE>

SUBJECT TO COMPLETION: DATED ____________

QUALIVEST FUNDS

3435 Stelzer Road
Columbus, Ohio 43219-3035
1-800-743-8637

. Qualivest Conservative Fund;
. Qualivest Balanced Fund;
. Qualivest Growth Fund; and
. Qualivest Aggressive Growth Fund.

Each Fund seeks its investment objective by investing in a diversified
portfolio of certain of the other funds offered by the Trust (the
"Underlying Funds").

Qualivest Capital Management, Inc. ("Qualivest"), Portland, Oregon, a
subsidiary of the United States National Bank of Oregon ("U.S. Bank"), acts
as the investment adviser to each of the Funds.

Additional information about the Trust and each of the Funds, contained in
a Statement of Additional Information dated _________________, has been
filed with the Securities and Exchange Commission and is available upon
request without charge by writing to the Trust at its address or by calling
the Trust at the telephone number shown above.

The Trustees of the Trust have divided beneficial ownership of each fund
into transferable units called shares (the "Shares"). Each Fund offers
multiple classes of Shares. This Prospectus describes one class of Shares
of each Fund -- the Class Y Shares. Class Y Shares of the Funds are
currently offered only through trust departments of banks and other
institutional investors (including other mutual funds distributed by the
BISYS Group, Inc. and its affiliated companies) with account balances of
$1,000,000 or more that have entered into a separate agreement, with the
Funds' distributor, relating to the investment of monies that are held in a
fiduciary, advisory, agency, custodial, or similar capacity. Each of the
Funds also offers Class A Shares and Class C Shares to

<PAGE>

the general public. These classes of Shares differ from each other, and from
the Class Y Shares, principally with respect to sales charges and the rate of
expenses to which they are subject. Interested persons who wish to obtain a
copy of the Prospectus of the Class A or Class C Shares of the Funds may
contact the Trust at the telephone number shown above.

Shares of the Funds are not deposits or obligations of, and are not
endorsed, insured or guaranteed by, any bank, the Federal Deposit
Insurance Corporation, or any other agency. An investment in the Funds
involves investment risk, including the possible loss of principal.

This Prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Investors should read
this Prospectus and retain it for future reference.

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

The date of this Prospectus is ______________, 1996.

- 2 -
<PAGE>

TABLE OF CONTENTS

Page
----

FUND EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

FEE TABLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . . . .

INVESTMENT OBJECTIVES AND POLICIES -- UNDERLYING FUNDS . . . . . . . .
Equity Funds . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income Funds . . . . . . . . . . . . . . . . . . . . . . . . . . .
Money Funds . . . . . . . . . . . . . . . . . . . . . . . . . . .

UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS . . . . . . .
U.S. Government Obligations . . . . . . . . . . . . . . . . . . .
Mortgage-Related and Asset-Backed Securities . . . . . . . . . . .
Bankers' Acceptances . . . . . . . . . . . . . . . . . . . . . . .
Certificates of Deposit and Time Deposits . . . . . . . . . . . .
Commercial Paper . . . . . . . . . . . . . . . . . . . . . . . . .
Put and Call Options . . . . . . . . . . . . . . . . . . . . . . .
Foreign Securities . . . . . . . . . . . . . . . . . . . . . . . .
Foreign Currency Transactions . . . . . . . . . . . . . . . . . .
Repurchase Agreements . . . . . . . . . . . . . . . . . . . . . .
Reverse Repurchase Agreements and Dollar Roll Agreements . . . . .
Futures Contracts . . . . . . . . . . . . . . . . . . . . . . . .
When-Issued and Delayed-Delivery Transactions . . . . . . . . . .
Lending of Portfolio Securities . . . . . . . . . . . . . . . . .
Medium-Grade Securities . . . . . . . . . . . . . . . . . . . . .
Securities Issued by Other Investment Companies . . . . . . . . .

- 3 -

<PAGE>

Restricted Securities . . . . . . . . . . . . . . . . . . . . . .

VALUATION OF SHARES . . . . . . . . . . . . . . . . . . . . . . . . . .

MANAGEMENT OF THE FUNDS . . . . . . . . . . . . . . . . . . . . . . . .
Trustees . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment Adviser . . . . . . . . . . . . . . . . . . . . . . . .
Administrator and Distributor . . . . . . . . . . . . . . . . . .
Other Service Providers . . . . . . . . . . . . . . . . . . . . .
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Banking Laws . . . . . . . . . . . . . . . . . . . . . . . . . . .
Participating Organizations . . . . . . . . . . . . . . . . . . .

- 4 -

<PAGE>

PROSPECTUS SUMMARY

Shares Offered

Class Y Shares of the Qualivest Conservative Fund (the "Conservative
Fund"), the Qualivest Balanced Fund (the "Balanced Fund"), the Qualivest
Growth Fund (the "Growth Fund"), and the Qualivest Aggressive Growth Fund
(the "Aggressive Growth Fund") (collectively, the "Funds"), which are four
separate diversified investment portfolios ("funds") of Qualivest Funds
(the "Trust"), a Massachusetts business trust which is registered as an
open-end investment company.

Offering Price and Sales Charges

The public offering price of Class Y Shares of each Fund is equal to the
net asset value per Share with no sales charge and no contingent deferred
sales charge ("CDSC") imposed on redemptions. Class Y Shares are offered
only through trust departments of banks and through other institutional
investors for monies that are held in a fiduciary, agency, custodial, or
similar capacity.

Investment Objectives

The Conservative Fund seeks to produce current income with a secondary
- ---------------------
objective of long-term capital appreciation.

The Balanced Fund seeks to provide a balance between long-term capital
- -----------------
appreciation and current income.

The Growth Fund seeks to provide capital appreciation and income growth.
- ---------------

The Aggressive Growth Fund seeks to provide maximum capital appreciation.
- --------------------------

Investment Policies

- 5 -

<PAGE>

the Qualivest Small Companies Value Fund (the "Small Companies Fund"), the
Qualivest International Opportunities Fund (the "International Fund") and the
Qualivest Optimized Stock Fund (the "Optimized Fund") (collectively, the
"Equity Funds"); the Qualivest Intermediate Bond Fund (the "Intermediate
Bond Fund") and the Qualivest Diversified Bond Fund (the "Bond Fund")
(collectively, the "Income Funds"); and the Qualivest U.S. Treasury Money
Market Fund (the "U.S. Treasury Fund") and the Qualivest Money Market Fund
(the "Money Market Fund") (collectively, the "Money Funds"). See
"INVESTMENT OBJECTIVES AND POLICIES."

Risk Factors and Special Considerations

An investment in the Funds involves a certain amount of risk and may not be
suitable for all investors. See "INVESTMENT OBJECTIVES AND POLICIES --
UNDERLYING FUNDS" and "UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK
FACTORS."

Investment Adviser

Dividends and Capital Gains

Dividends from net income are declared and paid quarterly for the Funds.
Net realized capital gains are distributed at least annually.

Other Information

- 6 -

<PAGE>
FUND EXPENSES

The following expense tables indicate costs and expenses that an investor
should anticipate incurring either directly or indirectly as a Shareholder
of a Fund during its first fiscal year of operations. The numbers reflect
estimated levels of operating expenses.

FEE TABLES

Qualivest Qualivest
Conservative Fund Balanced Fund
----------------- -------------

Shareholder Transaction Expenses

Maximum Sales Charge Imposed on
Purchases (as a percentage
of offering price) . . . None None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price) None None
Deferred Sales Charge (as a
percentage of redemption
proceeds) . . . . . . . None None
Redemption Fees (as a percentage
of redemption proceeds). . None None
Exchange Fees . . . . . . None None

Annual Fund Operating Expenses
(as a percentage of average
net assets annualized)
Management Fees After Waiver1 0.00% 0.00%
12b-1 Fees . . . . . . . . None None
Other Expenses . . . . . . ____ ____

Total Fund Operating Expenses
After Waiver2 . . . . . . ____% ____%

Qualivest Qualivest Aggressive
Growth Fund Growth Fund
----------- --------------------

Shareholder Transaction Expenses

Maximum Sales Charge Imposed on
Purchases (as a percentage
of offering price) . . . . . . None None
Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price) None None
Deferred Sales Charge (as a
percentage of redemption
proceeds) . . . . . . . None None
Redemption Fees (as a percentage
of redemption proceeds) None None
Exchange Fees . . . . . . None None

Annual Fund Operating Expenses
(as a percentage of average
net assets annualized)
Management Fees After Waiver1 0.00% 0.00%
12b-1 Fees . . . . . . . . . None None
Other Expenses . . . . . . . ____ ____

Total Fund Operating Expenses
After Waiver2 . . . . . . . ____% ____%

- ----------------
1 Qualivest has agreed to temporarily waive a portion of its
investment advisory fee for the Funds for the current fiscal
year. Waived fees cannot be recovered at a future date.
Absent the advisory fee waiver, "Management Fees" as a
percentage of average daily net assets would be 0.20% for each
Fund. See "MANAGEMENT OF THE FUNDS - Investment Adviser."

2 Absent the waiver of the investment advisory fee, "Total Fund
Operating Expenses" as a percentage of average daily net
assets would be % for the Conservative Fund, % for the
----- -----
Balanced Fund, % for the Growth Fund, and % for the
----- -----
Aggressive Growth Fund. However, Qualivest has agreed to
reimburse each Fund of its operating expenses in the current
fiscal year to the extent that such expenses exceed 0.25% of
the Fund's average daily net assets.

The Funds are expected to operate without directly incurring any
significant expenses other than certain administrative and

- 7 -
<PAGE>

custodial expenses. However, Shareholders of the Funds will indirectly bear
their pro rata share of fees and expenses incurred by the Underlying Funds, so
that the investment returns of the Funds will be net of the expenses of the
Underlying Funds. The following chart provides the expense ratios for each
of the currently operative Underlying Funds. Where applicable, expense
ratios of the Underlying Funds have been restated to reflect current fees.

Expense
Ratio
------

Based on these figures, the average weighted expense ratio for each Fund,
expressed as a percentage of each Fund's average daily net assets, is
estimated to be as follows: Conservative Fund - ____%; Balanced Fund -
____%; Growth Fund - ____%; and Aggressive Growth Fund - ____%. On the
basis of these estimated expense levels, an investor would pay the
following expenses on a $1,000 investment,

- 8 -

<PAGE>

assuming (1) 5% annual return, and (2) redemption at the end of each time
period:

Qualivest Qualivest
Conservative Fund Balanced Fund
----------------- -------------

1 Year . . . . . . $__ $__
3 Years . . . . . . $__ $__

Qualivest Qualivest Aggressive
Growth Fund Growth Fund
----------- --------------------

1 Year . . . . . . $__ $__
3 Years . . . . . . $__ $__

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

* These examples should not be considered representations of future
expenses, which may be more than those shown. The assumed 5% annual
return is hypothetical and should not be considered a representation
of past or future annual return. Actual return may be greater or less
than the assumed amount.

INVESTMENT OBJECTIVES AND POLICIES

The Conservative Fund. The investment objective of the Conservative Fund
- ---------------------
is to seek to produce current income with a secondary objective of long-
term capital appreciation.

The Conservative Fund is designed for investors who want a source of steady
investment income with limited Share price fluctuation, and who are willing
to bear limited investment risk. This Fund will concentrate its
investments in Underlying Funds that invest primarily in fixed income
securities and short-term money market instruments. However, for purposes
of achieving capital appreciation and investment income, the Conservative
Fund also may

- 9 -

<PAGE>

invest a portion of its assets in Underlying Funds that invest primarily in
equity securities.

The Balanced Fund. The investment objective of the Balanced Fund is to
- -----------------
seek to provide a balance between long-term capital appreciation and
current income.

The Balanced Fund seeks this objective by broadly diversifying its assets
among most or all of the Underlying Funds, with emphasis placed on
investments in the Equity Funds and the Income Funds. This Fund offers
investors greater potential for capital appreciation than does the
Conservative Fund by virtue of its larger investments in the Equity Funds,
while also offering investors the potential for investment income. This
Fund may be suitable for investors seeking capital appreciation in addition
to income, and who are willing to bear some risk of loss and Share price
fluctuation inherent in equity securities.

The Growth Fund. The investment objective of the Growth Fund is to seek to
- ---------------
provide capital appreciation and income growth.

The Growth Fund is designed for investors seeking capital appreciation
primarily through an equity-oriented investment. This Fund focuses on
investments in the Equity Funds, concentrating most heavily in the Large
Companies Fund and the Optimized Fund, although it may invest in all of the
Equity Funds. The Growth Fund also will invest in the Income Funds and
Money Funds. However, this Fund emphasizes the potential rewards and risks
of an investment in equity securities.

The Aggressive Growth Fund. The investment objective of the Aggressive
- --------------------------
Growth Fund is to seek to provide maximum capital appreciation.

The Aggressive Growth Fund seeks to achieve this objective by investing
substantially all of its assets in those Underlying Funds that invest
primarily in equity securities. While this Fund's investments are most
heavily weighted toward the Large Companies Fund and Optimized Fund, up to
35% of its assets may be invested in each of the Small Companies Fund and
the International Fund. Accordingly, this Fund is oriented toward those
investors seeking long-term capital appreciation, with the potential for
greater gains but with greater risk of loss.

- 10 -

<PAGE>

The Funds will invest their assets in the following Underlying Funds,
within the ranges (expressed as a percentage of each Fund's assets)
indicated below:

Aggressive
Conservative Balanced Growth Growth
Underlying Fund Fund Fund Fund Fund
- --------------- ------------ -------- ------ ----------

For purposes of determining each Fund's compliance with these percentage
limitations, Qualivest will determine the value of a Fund's assets at the
time of investment.

While Qualivest intends to invest each Fund's assets in the Underlying
Funds within the ranges set forth above, and to periodically adjust the
allocations in response to economic and market conditions, each Fund has a
"neutral mix" representing the intended typical allocation of the Fund's assets
over time. Qualivest anticipates that each Fund's neutral mix will be as
follows:

Underlying Funds
----------------
Income and
Fund Equity Funds Money Funds
- ---- ------------ -----------

Conservative Fund 20% 80%
Balanced Fund 60% 40%
Growth Fund 80% 20%
Aggressive Growth Fund 100% 0%

- 11 -
<PAGE>

necessary to meet redemption requests by the Funds' Shareholders, the Funds
may be unable to reallocate assets among the Underlying Funds as quickly
as would be the case in the absence of this constraint.

Each Fund's investments are concentrated in the Underlying Funds, and the
investment performance of each Fund is directly related to the performance
of the Underlying Funds. The Funds will invest in the Class Y Shares of
the Underlying Funds, which are sold at net asset value per Share with no
sales charge or CDSC. See "INVESTMENT OBJECTIVES AND POLICIES -- UNDERLYING
FUNDS" for a description of the Underlying Funds in which the Funds invest.

In addition to Shares of the Underlying Funds, for temporary cash
management purposes, each Fund may invest in short-term obligations (with
maturities of 12 months or less) consisting of commercial paper (including
variable amount master demand notes), bankers' acceptances, certificates of
deposit, repurchase agreements, obligations issued or guaranteed by the
U.S. Government or its agencies or instrumentalities, asset-backed and
mortgage-related securities, and demand and time deposits of domestic and
foreign banks and savings and loan associations. The Funds also may hold
depositary or custodial receipts representing beneficial interests in any
of the foregoing securities. See "UNDERLYING FUNDS' INVESTMENT TECHNIQUES
AND RISK FACTORS" for a description of these investments.

* * * *

- 12 -

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES -- UNDERLYING FUNDS

The following is a description of the investment objectives and policies of
the Underlying Funds. Additional investment practices are described in
"UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS," the Statement
of Additional Information, and the Prospectus for each of the Underlying
Funds.

Equity Funds

Large Companies and Small Companies Funds
- -----------------------------------------

The Large Companies Fund. The investment objective of the Large Companies
- ------------------------
Fund is to seek long-term capital appreciation. It invests primarily in
common stocks and securities convertible into common stocks of large
capitalization companies. For purposes of this policy, large
capitalization companies are those with capitalization of $1 billion or
more at the time of purchase.

The Small Companies Fund. The investment objective of the Small Companies
- ------------------------
Fund is to seek capital appreciation. It invests primarily in common
stocks and securities convertible into common stocks of small-sized companies.
For purposes of this policy, small-sized companies are those with capitalization
of less than $1 billion at the time of purchase. Smaller capitalization stocks
may be quite volatile and subject to wide fluctuations in both the short and
medium term.

Each of these Underlying Funds seeks to achieve its investment objective by
following flexible investment policies emphasizing investment in common
stocks and securities convertible into common stocks (without regard to
rating by a nationally recognized statistical rating organization
("NRSRO")) that are, in Qualivest's opinion, undervalued relative to other
securities at the time of purchase. In analyzing different securities,
Qualivest will consider various investment oriented ratios as significant
factors in assessing relative value, including market price to book value,
market price to earnings, and market price to assets. Also considered are
estimated liquidating value, earnings growth rate, and cash flow. If in
Qualivest's opinion a stock has reached a fully valued position, it will,
under most circumstances, be sold and replaced by securities which are
deemed to be undervalued in the marketplace.

- 13 -

<PAGE>

Under normal market conditions, each of the Large Companies and Small
Companies Funds will invest primarily in common stocks and securities
convertible into common stocks of companies believed by Qualivest to be
characterized by sound management and the potential for long-term capital
appreciation. Qualivest also may consider income and payment of dividends
in selecting securities for the Large Companies Fund. Under normal market
conditions, the Large Companies Fund intends to invest at least 65% of its
total assets in common stocks and securities convertible into common stocks
of companies with a market capitalization of at least $1 billion at the
time of purchase. In addition, under normal market conditions, the Small
Companies Fund will invest at least 65% of its total assets in common
stocks and securities convertible into common stocks of companies with a
market capitalization of less than $1 billion at the time of purchase. If
the Large Companies Fund owns securities issued by a company whose market
capitalization falls below $1 billion, or the Small Companies Fund owns
securities issued by a company whose market capitalization increases above
$1 billion, Qualivest may, but is not required to, sell such securities.
However, Qualivest will sell such securities if, in its judgment, market
conditions warrant such a sale, or if the Large Companies Fund or Small
Companies Fund would no longer be primarily invested in common stocks and
securities convertible into common stocks issued by large capitalization
companies and small-sized companies, respectively.

Each of the Large Companies and Small Companies Funds may also invest up to
35% of the value of its total assets in preferred stocks, notes, units of
real estate investment trusts, asset-backed and mortgage-related
securities, warrants, and short-term obligations (with maturities of 12 months
or less) consisting of commercial paper (including variable amount master
demand notes), bankers' acceptances, certificates of deposit, repurchase
agreements, obligations issued or guaranteed by the U.S. Government or its
agencies or instrumentalities, and demand and time deposits of domestic and
foreign banks and savings and loan associations. Each of these Underlying
Funds may also hold securities of other investment companies and depositary or
custodial receipts representing beneficial interests in any of the
foregoing securities.

Each of these Underlying Funds may invest in corporate debt securities such
as debt obligations with a maturity of at least one

- 14 -

<PAGE>

year from the date of issue ("bonds") and notes which are rated at the time of
purchase within the four highest rating groups assigned by an NRSRO (e.g., in
----
the case of Moody's Investors Service, Inc. ("Moody's"), Aaa, Aa, A and Baa,
and in the case of Standard & Poor's Corporation ("S&P"), AAA, AA, A and BBB),
which are considered to be investment grade or, if unrated, which Qualivest
deems to present attractive opportunities and are of comparable quality. For a
description of NRSROs and their rating symbols, see the Appendix to the
Statement of Additional Information. For a discussion of debt securities
rated within the fourth highest rating group assigned by an NRSRO, see
"UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS -- Medium-Grade
Securities" herein.

Subject to the foregoing policies, each of these Underlying Funds may also
invest up to 25% of its total assets in foreign securities either directly
or through the purchase of American Depositary Receipts and may also invest
in securities issued by foreign branches of U.S. banks and foreign banks,
in Canadian Commercial Paper, and in Europaper (U.S. dollar denominated
commercial paper of a foreign issuer). For a discussion of risks
associated with foreign securities, see "UNDERLYING FUNDS' INVESTMENT
TECHNIQUES AND RISK FACTORS" herein.

International and Optimized Funds
- ---------------------------------

The International Fund. The investment objective of the International Fund
- ----------------------
is to seek capital appreciation. It invests primarily in common stocks and
securities convertible into common stocks of companies that are organized
under the laws of countries other than the U.S.

The Optimized Fund. The investment objective of the Optimized Fund is to
- ------------------
seek capital appreciation and current income.

The International Fund and the Optimized Fund each seeks to achieve its
investment objective by investing primarily in common stocks and securities
convertible into common stocks (without regard to NRSRO rating) of
companies whose securities are listed on a specific securities index. While
the performance of the Optimized Fund may be expected to approximate the
performance of the Standard & Poor's 500 Composite Stock Price Index (the
"S&P 500 Index"),

- 15 -

<PAGE>

Qualivest seeks to outperform the S&P 500 Index through limited management of
the Optimized Fund's portfolio.

Under normal market conditions, at least 80% of the total assets of the
International Fund will be invested in common stocks and securities
convertible into common stocks of foreign companies whose securities are
listed on the Morgan Stanley Capital International EAFE (Europe,
Australasia, Far East) Index (the "EAFE Index"). The International Fund
will invest in the securities of issuers from at least three countries
other than the U.S. Investments are selected for inclusion in the
International Fund's portfolio primarily on the basis of market
capitalization and industry weightings, and to create an aggregate country
weighting similar to that of the EAFE Index. While Qualivest anticipates
that substantially all of the International Fund's assets will be so
invested, Qualivest may invest up to 20% of its total assets in common
stocks and securities convertible into common stocks of large
capitalization U.S. companies that Qualivest deems to present attractive
investment opportunities due to such companies' foreign business
operations.

Under normal market conditions, at least 80% of the Optimized Fund's total
assets will be invested in common stocks and securities convertible into
common stocks of companies whose securities are listed on the S&P 500
Index. While Qualivest anticipates that substantially all of the Optimized
Fund's assets will be so invested, Qualivest may invest up to 20% of its
total assets as described below.

The Optimized Fund does not intend to mirror the performance of the S&P 500
Index; rather, it seeks to optimize its investments in S&P 500 Index
companies and outperform the S&P 500 Index over time by investing in
securities that, on the basis of computerized modelling and performance
optimization strategies implemented by Qualivest, demonstrate attributes
that indicate performance superior to that of the S&P 500 Index as a whole.
The S&P 500 Index is composed of 500 common stocks chosen by S&P on a
statistical basis to be included in the index. Because of the market-value
weighting, the largest companies in the S&P 500 Index typically account for
a disproportionate share of the index. Qualivest believes that an
investment in securities of companies listed on the S&P 500 Index may be
optimized by selecting those securities whose growth and value
characteristics indicate that

- 16 -

<PAGE>

their performance, relative to the other securities listed on the S&P 500 Index,
will exceed the extent to which the S&P 500 Index reflects their performance.
Qualivest intends to utilize computer modelling and other strategies to
identify those stocks that, in light of its assessment of general economic
conditions, Qualivest believes will achieve capital appreciation and current
income superior to the performance of a portfolio that merely seeks to
replicate the S&P 500 Index.

Each of the International Fund and the Optimized Fund may also invest up to
20% of the value of its total assets in short-term obligations (with
maturities of 12 months or less) consisting of commercial paper (including
variable amount master demand notes), bankers' acceptances, certificates of
deposit, repurchase agreements, obligations issued or guaranteed by the
U.S. Government or its agencies or instrumentalities, and demand and time
deposits of domestic and foreign banks and savings and loan associations.
These Underlying Funds may also each hold securities of other investment
companies and depositary or custodial receipts representing beneficial
interests in any of the foregoing securities.

The portfolio turnover rate for the International Fund and the Optimized
Fund is expected to be under 50%, a generally lower turnover rate than for
most other investment companies. Qualivest believes that a lower turnover
rate will reduce securities transaction costs incurred by these
Underlying Funds.

* * * *

Consistent with the foregoing, each of the Equity Funds will focus its
investments in those companies and types of companies that Qualivest
believes will enable such Underlying Fund to achieve its investment
objective. No Equity Fund will invest more than 15% of its net assets in
securities that are deemed to be illiquid. During temporary defensive
periods as determined by Qualivest, any of the Equity Funds may hold up to
100% of its total assets in high quality (i.e., rated within the top two
----
rating categories by an NRSRO) short-term debt obligations including
domestic bank certificates of deposit, bankers' acceptances and repurchase
agreements secured by bank instruments. However, to the extent

- 17 -

<PAGE>

that an Equity Fund is so invested, its investment objective may not be
achieved during that time.

Income Funds

The Intermediate Bond Fund. The investment objective of the Intermediate
- --------------------------
Bond Fund is to seek current income consistent with preservation of
capital.

The Bond Fund. The investment objective of the Bond Fund is to seek
- -------------
current income consistent with preservation of capital.

Under normal market conditions, at least 65% of the total assets of the
Intermediate Bond Fund and Bond Fund will be invested in bonds, which for
this purpose include debt obligations with a maturity of at least one year
from the date of issue. Fixed income or debt securities in which these
Underlying Funds may invest can have maturities of up to thirty years or more.
Each of these Underlying Funds may invest up to 35% of its total assets in
high quality money market instruments such as commercial paper (including
variable amount master demand notes), certificates of deposit and bankers'
acceptances, variable and floating rate notes, and asset-backed securities
without regard to maturity, except as set forth below. In addition, these
Underlying Funds may engage in certain loans of portfolio securities,
repurchase agreements and reverse repurchase agreements, and may also invest
in securities of other investment companies. The Intermediate Bond Fund will
maintain a dollar-weighted average maturity of three to seven years under
ordinary market conditions, while the Bond Fund will maintain a dollar-
weighted average maturity of approximately seven to eleven years under
ordinary market conditions.

Each of these Underlying Funds expects to invest in bonds, notes and
debentures of a wide range of U.S. corporate issuers. Such obligations, in
the case of debentures, will represent unsecured promises to pay, in the
case of notes and bonds, may be secured by mortgages on real property or
security interests in personal property and will in most cases differ in
their interest rates, maturities and times of issuance.

Each of these Underlying Funds may also invest in corporate debt securities
and convertible debt securities which are rated at the time of purchase
within the four highest rating groups assigned by

- 18 -

<PAGE>

an NRSRO (e.g., in the case of Moody's, Aaa, Aa, A and Baa, and in the case of
----
S&P, AAA, AA, A and BBB), which are considered to be investment grade or, if
unrated, which Qualivest deems to present attractive opportunities and are of
comparable quality. For a description of NRSROs and their rating symbols, see
the Appendix to the Statement of Additional Information. For a discussion of
debt securities rated within the fourth highest rating group assigned by an
NRSRO, see "UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS --
Medium-Grade Securities" herein.

Each of these Underlying Funds may hold short-term obligations (with
maturities of 12 months or less) consisting of domestic and foreign
commercial paper rated at the time of purchase within the top two
categories by an NRSRO (e.g., "A-2" or better by S&P, "Prime-2" or better
----
by Moody's, or "F-2" or better by Fitch Investors Service ("Fitch")) or, if
unrated, which Qualivest deems to present attractive opportunities and are
of comparable quality, including variable amount master demand notes,
bankers' acceptances, certificates of deposit and time deposits of domestic
and foreign branches of U.S. banks and foreign banks, and repurchase
agreements. These Underlying Funds may also invest in securities of other
investment companies or in Guaranteed Investment Contracts ("GICs"), which
are considered to be illiquid securities.

Each of these Underlying Funds may also invest in obligations of the
Export-Import Bank of the United States, in U.S. dollar denominated
international bonds for which the primary trading market is in the United
States ("Yankee Bonds"), or for which the primary trading market is abroad
("Eurodollar Bonds"), and in Canadian Bonds and bonds issued by
institutions, such as the World Bank and the European Economic Community,
organized for a specific purpose by two or more sovereign governments
("Supranational Agency Bonds").

- 19 -

<PAGE>

Association ("GNMA"), the Federal National Mortgage Association ("FNMA"),
the Federal Farm Credit Bureau ("FFCB"), the Tennessee Valley Authority
("TVA"), the Federal Home Loan Bank ("FHLB"), the Federal Land Bank, the
Federal Home Loan Mortgage Corporation ("FHLMC"), the Student Loan
Marketing Association ("SLMA") and in mortgage-related securities issued by
nongovernmental entities.

Each of these Underlying Funds also may invest in mortgage-related
securities issued by nongovernmental entities. Commercial banks, savings
and loan institutions, private mortgage insurance companies, mortgage
bankers and other secondary market issuers also create pass-through pools
of conventional residential mortgage loans. Although the market for such
securities is becoming increasingly liquid, securities issued by certain
private organizations may not be readily marketable. Neither of these
Underlying Funds will purchase mortgage-related securities or any other
assets which in Qualivest's opinion are illiquid, if as a result, more than
15% of the value of its net assets will be illiquid.

Mortgage-related securities in which these Underlying Funds may invest may
also include collateralized mortgage obligations ("CMOs"), which are debt
obligations issued generally by finance
subsidiaries or trusts that are secured by mortgage-backed certificates,
including, in many cases, certificates issued by government-related
guarantors, including GNMA, FNMA and FHLMC, together with certain funds and
other collateral.

- 20 -

<PAGE>

Card Receivable Securities or "CARDS"). These assets are generally held by a
trust and payments of principal and interest or interest only are passed
through monthly or quarterly to certificate holders and may be guaranteed
up to certain amounts by letters of credit issued by a financial institution
affiliated or unaffiliated with the trustee or originator of the trust.
Asset-backed securities will be purchased only if they meet the rating
requirements set forth above or, if unrated, are deemed to be of comparable
quality by Qualivest with respect to these Underlying Funds' investments in
fixed-income securities of U.S. corporations and mortgage-related securities.

An increase in interest rates will generally reduce the value of the
investments in these Underlying Funds, and a decline in interest rates will
generally increase the value of those investments. Depending upon the
prevailing market conditions, Qualivest may purchase debt securities at a
discount from face value, which produces a yield greater than the coupon
rate. Conversely, if debt securities are purchased at a premium over face
value, the yield will be lower than the coupon rate.

* * * *

In making investment decisions for the Income Funds, Qualivest will
consider many factors, including current yield, maturity, and yield to
maturity. Qualivest will also monitor the financial condition of the
issuers of the Income Funds' portfolio investments and may shorten the
average weighted portfolio maturity of an Income Fund, in light of each
such Underlying Fund's investment objective of preservation of capital, if
economic or market conditions warrant such action.

Money Funds

Although each Money Fund has the same investment adviser and a similar
investment objective, its particular portfolio securities and yield may
differ due to differences in the types of permitted investments, cash flow,
and the availability of particular portfolio investments.

The U.S. Treasury Fund. The investment objective of the U.S. Treasury Fund
- ----------------------
is to seek current income consistent with liquidity and stability of
principal.

- 21 -

<PAGE>

Under normal market conditions, the U.S. Treasury Fund invests at least 65%
of its total assets in short-term U.S. Treasury bills, notes, and bonds and
in other obligations issued or guaranteed by the U.S. Government. The U.S.
Treasury Fund may invest up to 35% of its total assets in other types of
high quality rated money market instruments and money market instruments
that, although not rated, are deemed to be of comparable high quality as
determined by Qualivest pursuant to guidelines adopted by the Board of
Trustees.

This Underlying Fund expects that a majority of its income will be exempt
from state taxes as a result of its investing in U.S. Government securities
whose interest payments are state tax-exempt. Most states allow for a
pass-through of this tax exemption, so that the U.S. Treasury Fund's
dividend distributions may also be state tax-exempt with respect to the
income earned by it on U.S. Government securities.

The Money Market Fund. The investment objective of the Money Market Fund
- ---------------------
is to seek current income consistent with liquidity and stability of
principal.

The Money Market Fund invests in high quality rated money market
instruments and other money market instruments that, although not rated,
are deemed to be of comparable high quality as determined by Qualivest
pursuant to guidelines adopted by the Board of Trustees.

* * * *

- 22 -

<PAGE>

obligations ("Second Tier Securities") and not more than the greater of 1% of
total assets or one million dollars is invested in the securities of any one
issuer of Second Tier Securities. In addition, no Money Fund will invest more
than 10% of its net assets in securities that are deemed to be illiquid at the
time of purchase. All securities or instruments in which a Money Fund invests
have remaining maturities of 397 calendar days (thirteen months) or less. The
dollar-weighted average maturity of the obligations in a Money Fund will
not exceed 90 days.

Subject to the foregoing general limitations, the Money Funds expect to
invest in the types of securities discussed below under "INVESTMENT
TECHNIQUES AND RISK FACTORS." These securities include short-term
obligations issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, short-term asset-backed and mortgage-related securities,
bankers' acceptances, certificates of deposit and time deposits (including
Eurodollar Certificates of Deposit ("ECDs"), Eurodollar Time Deposits
("ETDs"), Canadian Time Deposits ("CTDs"), and Yankee Certificates of
Deposit ("Yankee CDs")), commercial paper (including variable amount master
demand notes), securities issued by other money market investment
companies, GICs, repurchase agreements, reverse repurchase agreements and
dollar roll agreements.

UNDERLYING FUNDS' INVESTMENT TECHNIQUES AND RISK FACTORS

Each Fund's Share price will fluctuate in response to changes in the Share
price of one or more of the Underlying Funds, which are permitted to engage
in a wide range of investment techniques. Like any investment program, an
investment in an Underlying Fund entails certain risks.

U.S. Government Obligations

- 23 -

<PAGE>

financial support to U.S. Government-sponsored agencies or
instrumentalities if it is not obligated to do so by law.

The Stripped Treasury Obligations in which the Funds may invest do not
include Certificates of Accrual on Treasury Securities ("CATS") or Treasury
Income Growth Receipts ("TIGRs"). Stripped securities are issued at a
discount to their "face value" and may exhibit greater price volatility
than ordinary debt securities because of the manner in which their
principal and interest are returned to investors.

Mortgage-Related and Asset-Backed Securities

Investments in these and other derivative securities will not be made for
purposes of leverage or speculation, but rather primarily for conventional
investment or hedging purposes, liquidity, flexibility and to capitalize on
market inefficiencies. Consistent with its investment objective,
restrictions and policies, each of the Funds except the Optimized Fund and
the International Fund may invest in mortgage-related securities, which are
securities representing interests in "pools" of mortgages in which payments
of both interest and principal on the securities are made monthly. Early
repayment of principal on mortgage-related securities may expose a Fund to
a lower rate of return upon reinvestment of principal. Like other fixed-
income securities, when interest rates rise, the value of a mortgage-
related security generally will decline; however, when interest rates
decline, the value of mortgage-related securities with prepayment features
may not increase as much as other fixed-income securities. For this and
other reasons, the stated maturity of a mortgage-related security may be
shortened by unscheduled prepayments on the underlying mortgages and,
accordingly, it is not possible to predict accurately the security's return
to a Fund.

- 24 -

<PAGE>

or receivables are not realized because of unanticipated legal or
administrative costs of enforcing the contracts or because of depreciation
or damage to the collateral (usually automobiles) securing certain
contracts, or other factors. In certain market conditions, asset-backed
securities may experience volatile fluctuations in value and periods of
illiquidity. If consistent with its investment objective and policies, a
Fund may invest in other asset-backed securities that may be developed in
the future.

The staff of the Securities and Exchange Commission is of the view that
certain issuers of asset-backed securities not complying with Securities
and Exchange Commission regulations are investment companies under the
Investment Company Act of 1940 (the "1940 Act"). The Underlying Funds
intend to conduct their operations in a manner consistent with this view
and, among other things, generally will not invest more than 10% (25% for
the Money Funds) of their total assets (when combined with investments in
securities of other investment companies, if any) in the obligations of
such issuers without obtaining appropriate regulatory relief.

Bankers' Acceptances

The Funds may invest in bankers' acceptances guaranteed by domestic and
foreign banks if at the time of investment the guarantor bank has capital,
surplus, and undivided profits in excess of $100,000,000 (as of the date of
its most recently published financial statements).

Certificates of Deposit and Time Deposits

The Funds may invest in certificates of deposit and time deposits of
domestic and foreign banks and savings and loan associations if (a) at the
time of investment the depository institution has capital, surplus, and
undivided profits in excess of $100,000,000 (as of the date of its most
recently published financial statements), or (b) the principal amount of
the instrument is insured in full by the Federal Deposit Insurance
Corporation.

- 25 -

<PAGE>

ETDs, except they are issued by Canadian offices of major Canadian banks; and
Yankee CDs, which are certificates of deposit issued by a U.S. branch of a
foreign bank denominated in U.S. dollars and held in the United States.

None of the Money Funds will invest in excess of 10% of its net assets in
time deposits with maturities in excess of seven days which are subject to
penalties upon early withdrawal. Such time deposits include ETDs and CTDs
but do not include certificates of deposit.

Commercial Paper

Each Income Fund, each Parent Fund, the Money Market Fund, and, within the
limitations described above, the U.S. Treasury Fund may invest in
short-term promissory notes issued by corporations (including variable
amount master demand notes) rated at the time of purchase within the two
highest categories assigned by an NRSRO (e.g., A-2 or better by S&P,
----
Prime-2 or better by Moody's or F-2 or better by Fitch) or, if not rated,
found by Qualivest pursuant to guidelines adopted by the Board of Trustees
to be of comparable quality to instruments that are so rated. The Equity
Funds may invest in such instruments if rated in the four highest
categories assigned by an NRSRO or, if not rated, found by Qualivest
pursuant to guidelines adopted by the Board of Trustees to be of comparable
quality. The Money Market Fund, the Equity Funds and the Income Funds may
also invest in Canadian Commercial Paper, which is commercial paper issued
by a Canadian corporation or a Canadian counterpart of a U.S. corporation,
and in Europaper, which is U.S. dollar denominated commercial paper of a
foreign issuer.

- 26 -

<PAGE>

will continuously monitor their financial status and ability to meet payment
on demand. In determining average weighted portfolio maturity, a variable
amount master demand note will be deemed to have a maturity equal to the period
of time remaining until the principal amount can be recovered from the issuer
through demand. The period of time remaining until the principal amount can be
recovered under a variable master demand note shall not exceed seven days.

Put and Call Options

Each Equity and Income Fund may purchase put and call options on
securities, and each Equity Fund other than the Optimized Fund may purchase
such options on foreign currencies, subject to its applicable investment
policies, for the purposes of hedging against market risks related to its
portfolio securities and adverse movements in exchange rates between
currencies, respectively. Each Underlying Fund may also engage in writing
call options from time to time as Qualivest deems appropriate. The
Underlying Funds will write only covered call options (options on
securities or currencies owned by the particular Underlying Fund). When a
portfolio security or currency subject to a call option is sold, the
Underlying Fund will effect a "closing purchase transaction" -- the
purchase of a call option on the same security or currency with the same
exercise price and expiration date as the call option which such Underlying
Fund previously has written. If such Underlying Fund is unable to effect a
closing purchase transaction, it will not be able to sell the underlying
security or currency until the option expires or that Underlying Fund
delivers the underlying security or currency upon exercise. In addition,
upon the exercise of a call option by the holder thereof, the Underlying
Fund will forego the potential benefit represented by market appreciation
over the exercise price. Under normal conditions, it is not expected that
an Underlying Fund will cause the underlying value of portfolio securities
and/or currencies subject to such options to exceed 25% of its total
assets.

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<PAGE>

specified price, an option on a securities index gives the holder the right to
receive, upon exercise of the option, an amount of cash if the closing level of
the securities index upon which the option is based is greater than, in the case
of a call, or less than, in the case of a put, the exercise price of the option.

Price movements in securities which an Underlying Fund owns or intends to
purchase may not correlate perfectly with movements in the level of an
index and, therefore, an Underlying Fund bears the risk of a loss on an
index option that is not completely offset by movements in the price of
such securities. Because index options are settled in cash, a call writer
cannot determine the amount of its settlement obligations in advance and,
unlike call writing on specific securities, cannot provide in advance for,
or cover, its potential settlement obligations by acquiring and holding the
underlying securities. An Underlying Fund may be required to segregate
assets or provide an initial margin to cover index options that would
require it to pay cash upon exercise.

Foreign Securities

Investment in foreign securities is subject to special investment risks
that differ in some respects from those related to investments in
securities of U.S. domestic issuers. Such risks include political, social
or economic instability in the country of the issuer, the difficulty of
predicting international trade patterns, the possibility of the imposition
of exchange controls, expropriation, limits on removal of currency or other
assets, nationalization of assets, foreign withholding and income taxation,
and foreign trading practices (including higher trading commissions,
custodial charges and delayed settlements). Such securities may be subject
to greater fluctuations in price than securities issued by U.S.
corporations or issued or guaranteed by the U.S. Government, its agencies
or instrumentalities. The markets on which such securities trade may have
less volume and liquidity, and may be more volatile than securities markets
in the U.S. In addition, there may be less publicly available information
about a foreign company than about a U.S. domiciled company. Foreign
companies generally are not subject to uniform accounting, auditing and
financial reporting standards comparable to those applicable to U.S.
domestic companies. There is generally less government regulation of
securities exchanges, brokers and listed companies abroad than in the U.S.
Confiscatory taxation or

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<PAGE>

diplomatic developments could also affect investment in those countries. In
addition, foreign branches of U.S. banks, foreign banks and foreign issuers
may be subject to less stringent reserve requirements and to different
accounting, auditing, reporting, and recordkeeping standards than those
applicable to domestic branches of U.S. banks and U.S. domestic issuers.

If a security is denominated in foreign currency, the value of the security
to an Underlying Fund will be affected by changes in currency exchange
rates and in exchange control regulations, and costs will be incurred in
connection with conversions between currencies. Currency risks generally
increase in lesser developed markets. Exchange rate movements can be large
and can endure for extended periods of time, affecting either favorably or
unfavorably the value of the Underlying Funds' assets.

For many foreign securities, U.S. dollar denominated American Depositary
Receipts ("ADRs"), which are traded in the United States on exchanges or
over-the-counter, are issued by domestic banks. ADRs represent the right
to receive securities of foreign issuers deposited in a domestic bank or a
correspondent bank. ADRs do not eliminate all the risk inherent in
investing in the securities of foreign issuers. However, by investing in
ADRs rather than directly in foreign issuers' stock, an eligible Equity
Fund can avoid currency risks during the settlement period for either
purchases or sales.

Subject to its applicable investment policies, each Equity Fund other than
the Optimized Fund may invest in debt securities denominated in the
European Currency Unit ("ECU"), which is a "basket" consisting of specified
amounts of the currencies of certain of the member states of the European
Community. The specific amounts of currencies comprising the ECU may be
adjusted by the Council of Ministers of the European Community to reflect
changes in relative values of the underlying currencies. Such adjustments
may adversely affect holders of ECU denominated obligations or the
marketability of such securities.

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<PAGE>

Foreign Currency Transactions

The value of the assets of an Equity Fund other than the Optimized Fund as
measured in U.S. dollars may be affected favorably or unfavorably by
changes in foreign currency exchange rates and exchange control
regulations, and an Underlying Fund may incur costs in connection with
conversions between various currencies. An Equity Fund will conduct its
foreign currency exchange transactions either on a spot (i.e., cash) basis
----
at the spot rate prevailing in the foreign currency exchange market, or
through forward contracts to purchase or sell foreign currencies. A forward
foreign currency exchange contract ("forward currency contract") involves
an obligation to purchase or sell a specific currency at a future date at a
price set at the time of the contract. The Equity Funds may enter into
forward currency contracts in order to hedge against adverse movements in
exchange rates between currencies. However, this tends to limit potential
gains which might result from a positive change in such currency
relationships. An Equity Fund may also hedge its foreign currency exchange
rate risk by engaging in currency financial futures and options
transactions. The forecasting of short-term currency market movements is
extremely difficult and whether such a short-term hedging strategy will be
successful is highly uncertain.

It is impossible to forecast with precision the market value of portfolio
securities at the expiration of a forward currency contract. Accordingly,
it may be necessary for an Equity Fund to purchase additional currency on
the spot market if the market value of the security is less than the amount
of foreign currency such Underlying Fund is obligated to deliver when a
decision is made to sell the security and make delivery of the foreign
currency in settlement of a forward contract. Conversely, it may be
necessary to sell on the spot market some of the foreign currency received
upon the sale of the portfolio security if its market value exceeds the
amount of foreign currency such Underlying Fund is obligated to deliver.

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<PAGE>

risk of loss due to a decline in the value of the hedged currency, they also
tend to limit any potential gain which might result should the value of such
currency increase. The Equity Funds will have to convert their holdings of
foreign currencies into U.S. dollars from time to time. Although foreign
exchange dealers do not charge a fee for conversion, they do realize a profit
based on the difference (the "spread") between the prices at which they are
buying and selling various currencies.

Repurchase Agreements

Securities held by a Fund (other than the U.S. Treasury Fund) may be
subject to repurchase agreements. Under the terms of a repurchase
agreement, a Fund would acquire securities from financial institutions,
subject to the seller's agreement to repurchase such securities at a
mutually agreed upon date and price, which includes interest negotiated on
the basis of current short-term rates. The seller under a repurchase
agreement will be required to maintain at all times the value of collateral
held pursuant to the agreement at not less than the repurchase price
(including accrued interest). If a seller defaults on its repurchase
obligations, a Fund may suffer a loss in disposing of the security subject
to the repurchase agreement.

Reverse Repurchase Agreements and Dollar Roll Agreements

Each of the Underlying Funds may also borrow funds by entering into reverse
repurchase agreements and dollar roll agreements in accordance with
applicable investment restrictions. Pursuant to such agreements, an
Underlying Fund would sell certain of its securities to financial
institutions such as banks and broker-dealers, and agree to repurchase
them, or substantially similar securities in the case of a dollar roll
agreement, at a mutually agreed upon date and price. A dollar roll
agreement is identical to a reverse repurchase agreement except for the
fact that substantially similar securities may be repurchased. At the time
an Underlying Fund enters into a reverse repurchase agreement or dollar
roll agreement, it will place in a segregated custodial account assets such
as U.S. Government securities or other liquid high grade debt securities
consistent with its investment restrictions having a value equal to the
repurchase price (including accrued interest), and will subsequently
continually monitor the account to ensure that such equivalent value is
maintained at all times. Reverse repurchase agreements and dollar roll
agreements involve the risk that the market value of securities sold by an
Underlying Fund may decline below the price at which it is obligated to
repurchase the securities.

Futures Contracts

The Equity and Income Funds may also enter into contracts for the future
delivery of securities or foreign currencies and futures contracts based on
a specific security, class of securities, foreign currency or an index,
purchase or sell options on any such futures contracts and engage in
related closing transactions. A futures contract on a securities index is
an agreement obligating either party to pay, and entitling the other party
to receive, while the contract is outstanding, cash payments based on the
level of a specified securities index. An Underlying Fund may engage in
such futures contracts in an effort to hedge against market risks and to
manage its cash position, but not for leveraging purposes.

Aggregate initial margin deposits for futures contracts, and premiums paid
for related options, may not exceed 5% of an Underlying Fund's total
assets, and the value of securities that are the subject of such futures
and options (both for receipt and delivery) may not exceed 33 1/3% of the
market value of an Underlying Fund's total assets. Futures transactions
will be limited to the extent necessary to maintain each Underlying Fund's
qualification as a regulated investment company.

When-Issued and Delayed-Delivery Transactions

The Underlying Funds may each purchase securities on a when-issued or
delayed-delivery basis. An Underlying Fund will engage in when-issued and
delayed-delivery transactions only for the purpose of acquiring portfolio
securities consistent with its investment objective and policies, not for
investment leverage. When-issued securities are securities purchased for
delivery beyond the normal settlement date at a stated price and yield and
thereby involve a risk that the yield obtained in the transaction will be less
than those available in the market when delivery takes place. An Underlying
Fund will not pay for such securities or start earning interest on them until
they are received. When an Underlying Fund agrees to purchase such securities,
its Custodian will set aside cash or high grade liquid debt securities equal
to the amount of

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<PAGE>

the commitment in a segregated account. In when-issued and delayed-delivery
transactions, an Underlying Fund relies on the seller to complete the
transaction; the seller's failure to do so may cause such Underlying Fund
to miss a price or yield considered to be advantageous.

Lending of Portfolio Securities

In order to generate additional income, the Equity Funds and the Income
Funds from time to time may lend portfolio securities to broker-dealers,
banks or institutional borrowers of securities. The Underlying Funds must
receive 102% collateral in the form of cash or U.S. Government securities.
This collateral must be valued daily by Qualivest and, should the market
value of the loaned securities increase, the borrower must furnish
additional collateral to the Underlying Funds. During the time portfolio
securities are on loan, the borrower pays the Underlying Funds any
dividends or interest paid on such securities. Loans are subject to
termination by the Underlying Funds or the borrower at any time. While the
Underlying Funds do not have the right to vote securities on loan, they
intend to terminate the loan and regain the right to vote if that is
considered important with respect to the investment. In the event the
borrower defaults on its obligation to an Underlying Fund, the Underlying
Fund could experience delays in recovering its securities and possible
capital losses. The Underlying Funds will only enter into loan
arrangements with broker-dealers, banks or other institutions which
Qualivest has determined to be creditworthy under guidelines established by
the Board of Trustees that permit each Underlying Fund to loan up to 33
1/3% of the value of its total assets.

Medium-Grade Securities

Each of the Income Funds, the Large Companies Fund and the Small Companies
Fund may invest up to 10% of its total assets in debt securities within the
fourth highest rating group assigned by an NRSRO (i.e., BBB or Baa by S&P
----
and Moody's, respectively) and comparable unrated securities. These types
of debt securities are considered by Moody's and S&P to have some
speculative characteristics, and are more vulnerable to changes in economic
conditions, higher interest rates or adverse issuer-specific developments
which are more likely to lead to a weaker capacity to

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<PAGE>

make principal and interest payments than comparable higher rated debt
securities.

Should subsequent events cause the rating of a debt security purchased by
one of the Underlying Funds to fall below BBB or Baa, as the case may be,
Qualivest will consider such an event in determining whether an Underlying
Fund should continue to hold that security. In no event, however, would a
Fund be required to liquidate any such portfolio security where the Fund
would suffer a loss on the sale of such security.

Securities Issued by Other Investment Companies

Each of the Equity and Income Funds may invest up to 10% of its total
assets, and each of the Money Funds may invest up to 25% of its total
assets, in shares of money market mutual funds for cash management
purposes. The U.S. Treasury Fund expects to make such purchases only in
money market funds that restrict their investments to U.S. Government
securities. An Underlying Fund will incur additional expenses due to the
duplication of expenses as a result of investing in other investment
companies.

Restricted Securities

Securities in which the Underlying Funds may invest include securities
issued by corporations without registration under the Securities Act of
1933, as amended (the "1933 Act"), in reliance on the so-called "private
placement" exemption from registration which is afforded by Section 4(2) of
the 1933 Act ("Section 4(2) securities"). Section 4(2) securities are
restricted as to disposition under the federal securities laws, and
generally are sold to institutional investors such as the Underlying Funds
who agree that they are purchasing the securities for investment and not
with a view to public distribution. Any resale must also generally be made
in an exempt transaction. Section 4(2) securities are normally resold to
other institutional investors through or with the assistance of the issuer
or investment dealers who make a market in such Section 4(2) securities,
thus providing liquidity. Pursuant to procedures adopted by the Board of
Trustees of the Trust, Qualivest may determine Section 4(2) securities to
be liquid if such securities are readily marketable. These securities may
include securities eligible for resale under Rule 144A under the 1933 Act.

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<PAGE>

VALUATION OF SHARES

The net asset value of each Fund is determined and its Shares are priced as
of the close of regular trading on the New York Stock Exchange ("NYSE")
(generally 1:00 p.m. Pacific Time) on each Business Day ("Valuation Time").
As used herein a "Business Day" is a day on which the NYSE is open for
trading, the Federal Reserve Bank of San Francisco is open, and any other
day except days on which there are insufficient changes in the value of a
Fund's portfolio securities to materially affect the Fund's net asset value or
days on which no Shares are tendered for redemption and no order to
purchase any Shares is received. Currently, the NYSE or the Federal
Reserve Bank of San Francisco is closed on the following holidays: New
Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day,
Thanksgiving and Christmas.

Net asset value per Share for a particular class for purposes of pricing
sales and redemptions is calculated by dividing the value of all securities
and other assets belonging to a Fund allocable to such class, less the
liabilities charged to that Fund allocable to such class and any
liabilities charged directly to that class, by the number of outstanding
Shares of such class.

The net asset value per Share of the Funds will fluctuate as the value of
the investment portfolio of a Fund changes.

PURCHASING SHARES

Class Y Shares may be purchased through a broker-dealer, bank, or trust
company that has established a dealer agreement with the Distributor.
Class Y Shares of each Fund are continuously offered and also may be
purchased directly either by mail, by telephone, or by wire.

An Account Application Form can be obtained by calling the Trust at 1-800-
743-8637.

Other Information Regarding Purchases

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<PAGE>

of Class Y Shares placed through a broker-dealer, the applicable public offering
price will be the net asset value as so determined, but only if the Distributor
receives the order prior to the Valuation Time for that day and transmits it to
the Trust by that Valuation Time. The broker-dealer is responsible for
transmitting such orders promptly. If the broker-dealer fails to do so, the
investor's right to that day's closing price must be settled between the
investor and the broker-dealer. Purchases of Class Y Shares of any of the
Funds will be effected only on a Business Day of the Funds. An order received
prior to the Valuation Time on any Business Day will be executed at the net
asset value determined as of the Valuation Time on the date of receipt. An
order received after the Valuation Time on any Business Day will be executed at
the net asset value determined as of the Valuation Time on the next
Business Day of that Fund.

Every Shareholder will receive a confirmation of, or account statement
reflecting, each new transaction in the Shareholder's account, which will
also show the total number of Class Y Shares of the respective Fund owned
by the Shareholder. Shareholders may rely on these statements in lieu of
certificates. Certificates representing Class Y Shares of the Funds will
not be issued.

Exchange Privilege

The exchange privilege enables Shareholders of Class Y Shares (including
Class Y Shares acquired through reinvestment of dividends and distributions
on such Shares) to acquire at net asset value Class Y Shares offered by
another Fund with a different investment objective, or Class Y Shares
offered by any of the Trust's other funds. Holders of Class Y Shares may
not exchange their Shares for Shares of any other class, and holders of
Shares of any other class may not exchange their Shares for Class Y Shares.

An exchange is considered a sale of Shares and may result in a capital gain
or loss for federal income tax purposes.

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<PAGE>

A Shareholder wishing to exchange his or her Shares may do so by contacting
the Custodian or an affiliate. Any Shareholder who wishes to make an
exchange should obtain and review the current prospectus of the Fund or
fund to be acquired before making the exchange. For a discussion of risks
associated with unauthorized telephone exchanges, see "REDEEMING SHARES --
By Telephone" below.

REDEEMING SHARES

Shareholders may redeem their Class Y Shares without charge on any day that
net asset value is calculated (see "VALUATION OF SHARES"). Redemptions
will be effected at the net asset value per Share next determined after
receipt by the Distributor of a redemption request. Redemptions may be
requested by mail or by telephone.

By Mail

A written request for redemption must be received by the Distributor in
order to honor the request. The Distributor's address is: BISYS Fund
Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035. The Transfer Agent
will require a signature guarantee by an eligible guarantor institution.
The signature guarantee requirement will be waived if all of the following
conditions apply: (1) the redemption check is payable to the Shareholder(s)
of record, and (2) the redemption check is mailed to the Shareholder(s) at
the address of record. The Shareholder may also have the proceeds mailed
to a commercial bank account previously designated on the Account Application
Form. There is no charge for having redemption proceeds mailed to a designated
bank account. To change the address to which a redemption check is to be
mailed, a written request therefor must be received by the Transfer Agent.
In connection with such request, the Transfer Agent will require a signature
guarantee by an eligible guarantor institution.

For purposes of this policy, the term "eligible guarantor institution"
shall include banks, brokers, dealers, credit unions, securities exchanges
and associations, clearing agencies and savings associations as those terms
are defined in the Securities Exchange Act of 1934. The Transfer Agent
reserves the right to reject any signature guarantee if (1) it has reason
to believe that the signature is not genuine, (2) it has reason to believe
that the transaction would otherwise be improper, or (3) the guarantor
institution is a broker or dealer that is neither a member of a

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<PAGE>

clearing corporation nor maintains net capital of at least $100,000.

By Telephone

Class Y Shares may be redeemed by telephone if the Account Application Form
reflects that the Shareholder has elected that privilege. If the telephone
feature was not originally selected, the Shareholder must provide written
instructions to the Trust to add it. The Shareholder may have the proceeds
mailed to the Shareholder's address or mailed or wired to a commercial bank
account previously designated on the Account Application Form. Under most
circumstances, payments will be transmitted on the next Business Day. Wire
redemption requests may be made by the Shareholder by telephone to the
Trust at 1-800-743-8637. While the Transfer Agent currently does not
charge a wire redemption fee, the Transfer Agent reserves the right to
impose such a fee in the future.

The Trust's Account Application Form provides that none of BISYS, the
Transfer Agent, Qualivest, the Trust or any of their affiliates or agents
will be liable for any loss, expense or cost when acting upon any oral,
wired or electronically transmitted instructions or inquiries believed by
them to be genuine. While precautions will be taken, as more fully
described below, Shareholders bear the risk of any loss as the result of
unauthorized telephone redemptions or exchanges believed by the Transfer
Agent to be genuine. The Trust will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine. These
procedures include recording all phone conversions, sending confirmations
to Shareholders within 72 hours of the telephone transaction, verifying the
account name and a Shareholder's account number or tax identification
number and sending redemption proceeds only to the address of record or to
a previously authorized bank account. If a Shareholder is unable to
contact the Funds by telephone, a Shareholder may also mail the redemption
request to the Distributor at the address above.

Other Information Regarding Redemption of Shares

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<PAGE>

within seven days after receipt of the request for redemption, or within such
shorter period as required by law. To the greatest extent possible, requests
from Shareholders of a Fund for next Business Day payments upon redemption of
Shares will be honored if received by the Distributor before the Valuation
Time on a Business Day or, if received after the Valuation Time, within two
Business Days, unless it would be disadvantageous to that Fund or its
Shareholders to sell or liquidate portfolio securities in an amount
sufficient to satisfy requests for payments in that manner.

See the Statement of Additional Information ("ADDITIONAL PURCHASE AND
REDEMPTION INFORMATION") for examples of when the right of redemption may
be suspended.

MANAGEMENT OF THE FUNDS

Trustees

Overall responsibility for management of the Trust rests with its Trustees,
who are elected by the Shareholders of all of the Trust's funds. The Trust
will be managed by the Trustees in accordance with the laws of the
Commonwealth of Massachusetts governing business trusts. There are
currently six Trustees, three of whom are not "interested persons" of the
Trust within the meaning of that term under the 1940 Act. The Trustees, in
turn, elect the officers of the Trust to supervise its day-to-day
operations. The Trustees of the Trust are: George R. Landreth, David F.
Jones, John W. Judy, Raymond H. Lung, Mary Anne Houlahan and David B.
Frohnmayer.

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<PAGE>

structured the Funds to avoid such conflicts, if a situation arises where
appropriate action for a Fund could adversely affect an Underlying Fund, or
vice versa, the Trustees and officers will carefully analyze the situation
and take all steps they believe reasonable to minimize and, where possible,
eliminate the potential conflict. To this end, restrictions have been
adopted by the Funds to minimize this possibility, and close and continuous
monitoring will be exercised to avoid, insofar as possible, these concerns.

Investment Adviser

Qualivest Capital Management, Inc., 111 S.W. Fifth Avenue, Portland, Oregon
97204, is the investment adviser of the Trust. Qualivest, a registered
investment adviser, is an affiliate of U.S. Bank, which is a wholly owned
subsidiary of U.S. Bancorp. U.S. Bancorp is a super-regional financial
services holding company organized under the laws of Oregon in 1968. U.S.
Bank, headquartered in Portland, is a national banking association
chartered in 1891. It offers a wide variety of full-service and commercial
banking operations in over 200 locations in Oregon. Other services of U.S.
Bancorp and its subsidiaries include mortgage banking, lease financing,
consumer financing, commercial finance, international banking, investment
advisory, insurance agency and credit life insurance services, brokerage
and venture capital. As of January 1, 1996, Qualivest had under management
nearly $8.0 billion in assets. It also is investment adviser to Tax-Free
Trust of Oregon, a tax-free municipal bond fund, whose assets were
approximately $310 million at that date.

Qualivest invests each Fund's assets according to its investment objective
and policies set forth above and pursuant to guidelines established by the
Board of Trustees for each Fund. Such allocation decisions are made by the
Qualivest Investment Strategy Committee (the "Committee"). No individual
or individuals are primarily responsible for the allocation decisions of
the Committee. For the services provided and expenses assumed pursuant to
its Investment Advisory Agreement with the Trust, Qualivest receives a
fee from each of the Funds, computed daily and paid monthly, at an annual
rate of 0.20% of each Fund's average daily net assets. However, Qualivest
has agreed to temporarily waive its investment advisory fee and reimburse
each Fund of its operating expenses in the current fiscal year to the
extent that such expenses exceed 0.25% of the Fund's average daily net assets.
Each Fund, as a Shareholder in an Underlying Fund, also will indirectly bear
its proportionate share of any investment advisory fees and other expenses
paid by the Underlying Fund. The ratios of operating expenses to average
daily net assets of the Class Y Shares of the Underlying Funds for the period
ended July 31, 1995 were as follows: Large Companies Fund - 0.53%; Small
Companies Fund - 0.60%; International Fund - 1.18%; Optimized Fund

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<PAGE>

- - 0.68%; Intermediate Bond Fund - 0.41%; Bond Fund - 0.70%; U.S. Treasury
Fund - 0.40% and Money Market Fund - 0.38%.

Subject to the general supervision of the Trust's Board of Trustees and in
accordance with each of the Funds' investment objective, policies and
restrictions, Qualivest has agreed in its Investment Advisory Agreement
with the Trust to provide or arrange for the provision of a continuous
investment program for each Underlying Fund, including investment research
and management with respect to the Underlying Funds' portfolio securities,
investments and cash.

John R. Dozier, who joined Qualivest in 1976, is the Equity Manager
primarily responsible for managing the Large Companies Fund. Mr. Dozier
has twenty-five years of investment management experience and received a
Bachelor of Arts degree in Economics from Claremont Men's College.

Dale E. Benson, an Equity Manager at Qualivest, has primary responsibility
for management of the Small Companies Fund. Mr. Benson has twenty-three
years of investment management experience and has been employed by
Qualivest since 1973. He received a Bachelor of Arts degree from Pacific
Lutheran University and a Doctorate in History from the University of
Maine. Mr. Benson is also a Chartered Financial Analyst.

Timothy Leach, President and Chief Investment Officer of Qualivest, manages
the International Fund and Optimized Fund. He has thirteen years of
investment management experience, both at Qualivest and at other investment
management organizations, and is responsible for the management of
Qualivest. Mr. Leach has a Bachelor of Science degree in Business
Management and Agricultural Science and a Master of Business
Administration degree from the University of California, Berkeley.

Portfolio management of the Intermediate Bond Fund and the Bond Fund is the
responsibility of Curry A. Garvin, a Fixed-Income Manager who has been
employed by Qualivest since 1985. Mr. Garvin, who is a Chartered Financial
Analyst, received a Bachelor of Science degree in Finance from the
University of Oregon.

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<PAGE>

average daily net assets: Large Companies Fund - 0.75%; Small Companies
Fund - 0.80%; International Fund - 0.60%; Optimized Fund -0.50%; Intermediate
Bond Fund - 0.60%; Bond Fund - 0.60%; U.S. Treasury Fund - 0.35%; and Money
Market Fund - 0.35%.

While the fees for the Large Companies and Small Companies Funds are higher
than the advisory fee paid by most investment companies, the Board of
Trustees believes them to be comparable to advisory fees paid by many funds
having similar objectives and policies. Qualivest may periodically
voluntarily reduce all or a portion of its advisory fee with respect to an
Underlying Fund to increase the net income of that Underlying Fund
available for distribution as dividends. The voluntary fee reduction will
cause the return of that Underlying Fund to be higher than it would
otherwise be in the absence of such reduction.

Administrator and Distributor

BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-3035, a
division of BISYS Group, Inc., is the administrator for each fund of the
Trust, and also acts as the Trust's principal underwriter and distributor.

The Administrator generally assists in all aspects of the Funds'
administration and operation. For expenses assumed and services provided
as administrator pursuant to its Management and Administration Agreement
with the Trust, the Administrator receives a fee from each Fund equal to
the lesser of a fee, computed daily and paid periodically, at an annual
rate of ____% of the Fund's average daily net assets, or such other fee as
may be agreed upon from time to time by the Trust and the Administrator.
The Administrator may periodically voluntarily reduce all or a portion of
its administrative fee with respect to a Fund to increase the net income of
that Fund available for distribution as dividends. The voluntary fee
reduction will cause the return of that Fund to be higher than it would
otherwise be in the absence of such reduction.

The Distributor acts as agent for the Funds in the distribution of their
Shares and, in such capacity, solicits orders for the sale of Shares,
advertises, and pays the cost of advertising, office space and its
personnel involved in such activities. Under its Distribution Agreement
with the Trust, the Distributor may retain some or all of any sales charge
imposed upon the Class A or Class

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<PAGE>

C Shares. It may also receive compensation under the Distribution and
Shareholder Service Plans regarding the Class A and Class C Shares.

Other Service Providers

BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-
3035, serves as the Trust's transfer agent and dividend disbursing agent
pursuant to a Transfer Agency Agreement with the Trust and receives a fee
for such services. BISYS Fund Services Ohio, Inc. also provides certain
accounting services for each of the Funds and receives a fee for such
services. Deloitte & Touche LLP serves as independent auditors for the
Trust. United States National Bank of Oregon is the custodian of the
Funds. See "MANAGEMENT OF THE TRUST" in the Statement of Additional
Information for further information.

Expenses

Qualivest and the Administrator each bear all expenses in connection with
the performance of its services other than the cost of securities purchased
for the Trust. Each Fund will bear the following expenses relating to its
operation: organizational expenses, taxes, interest, fees of the Trustees
of the Trust, Securities and Exchange Commission fees, state securities
qualification fees, costs of preparing and printing prospectuses for
regulatory purposes and for distribution to current Shareholders, outside
auditing and legal expenses, advisory and administration fees, fees and
out-of-pocket expenses of the Custodian, Transfer Agent and fund
accountant, certain insurance premiums, costs of maintenance of the Trust's
existence, costs of Shareholders' reports and meetings, and any
extraordinary expenses incurred in each Fund's operation.

As a general matter, expenses are allocated to the Class A, Class C and
Class Y Shares of the Funds on the basis of the relative net asset value of
each class. Class A and Class C Shares may bear

- 43 -

<PAGE>

certain additional retail transfer agency expenses. Class A and Class C
Shares also bear certain additional Shareholder service and distribution costs
incurred pursuant to the Distribution and Shareholder Service Plans.

The Trustees reserve the right, subject to the receipt of relevant
regulatory approvals or rulings, if needed, to allocate certain other
expenses to the Shareholders of a particular class, including Class Y
Shares, on a basis other than relative net asset value, as they deem
appropriate ("Class Expenses"). In such event, Class Expenses would be
limited to: transfer agency fees identified by the Transfer Agent as
attributable to a specific class; printing and postage expenses related to
preparing and distributing materials such as Shareholder reports,
prospectuses and proxies to current Shareholders; Blue Sky registration
fees incurred by a class of Shares; Securities and Exchange Commission
registration fees incurred by a class of Shares; expenses related to
administrative personnel and services as required to support the
Shareholders of a specific class; litigation or other legal expenses
relating solely to one class of Shares; and Trustees' fees incurred as a
result of issues relating solely to one class of Shares.

Banking Laws

Federal banking laws and regulations presently prohibit a national bank or
any affiliate thereof from sponsoring, organizing or controlling a
registered open-end investment company continuously engaged in the issuance
of its shares, and generally from underwriting, selling or distributing
securities, such as Shares of the Funds.

Qualivest is a subsidiary of U.S. Bank, and it and U.S. Bank are affiliates
of a bank holding company. They are therefore subject to applicable
federal banking laws and regulations. Qualivest has been advised by its
counsel that it may perform the advisory services for the Funds required by
the Investment Advisory Agreement and, provided that they do not engage in
underwriting, selling or distribution of the Funds' Shares, Qualivest's
national bank affiliates may perform shareholder servicing activities and
may receive compensation without violating federal banking laws and
regulations.

- 44 -

<PAGE>

In the event that, due to future events, Qualivest is prohibited from
acting as the investment adviser of the Funds and the Underlying Funds, it
is probable that the Board of Trustees would either recommend to
Shareholders the selection of another qualified adviser or, if that course
of action appeared impractical, that the Funds and Underlying Funds be
liquidated.

Participating Organizations

The Distributor may enter into agreements with banks and their affiliates
(including U.S. Bank and its affiliates), and other institutions, including
broker-dealers (each a "Participating Organization"), for providing
Shareholder services with respect to the Class Y Shares. Such
Participating Organizations will be compensated at the annual rate of up to
0.25% of the average daily net assets of the Class Y Shares held of record
or beneficially by customers of Participating Organizations who are record
or beneficial owners of Class Y Shares. The Trust understands that
Participating Organizations may charge fees to their customers who are the
owners of Class Y Shares for additional services provided in connection
with their customer accounts. These fees would be in addition to any
amounts which may be received by a Participating Organization under its
agreement with BISYS. Customers of Participating Organizations should read
this Prospectus in light of the terms governing their accounts with their
Participating Organizations.

The Shareholder services provided by Participating Organizations for which
the fee may be paid may include providing information periodically to
customers, including information showing their positions in Class Y Shares;
responding to inquiries from customers concerning their investment in Class
Y Shares; providing sub-accounting with respect to Class Y Shares
beneficially owned by customers or the information necessary for
sub-accounting; arranging for bank wires; and other continuing personal
services to holders of Class Y Shares.

- 45 -

<PAGE>

DIVIDENDS AND TAXES

Dividends

Federal Taxes

Each Fund intends to qualify annually and elect to be treated as a
regulated investment company under the Internal Revenue Code of 1986, as
amended (the "Code"), so that it generally will not be subject to federal
income tax on its taxable income and gains that are distributed to
Shareholders. In order to avoid a 4% federal excise tax, each Fund intends
to distribute each calendar year substantially all of its taxable income
and gains.

Distributions from a Fund's investment company taxable income (which
includes, among other items, dividends, taxable interest and the excess, if
any, of net short-term capital gains over net long-term capital losses) are
taxable to Shareholders as ordinary income. Dividends paid by the Funds to
corporate Shareholders, to the extent such dividends are attributable to
dividends received from U.S. corporations, may qualify for the dividends-
received deduction. However, the alternative minimum tax applicable to
corporations may reduce the value of the dividends-received deduction.
Distributions of net capital gains (the excess of net long-term capital
gains over net short-term capital losses), if any, designated by a Fund as
capital gain dividends, are taxable as long-term capital gains, regardless
of how long the Shareholder has held the Fund's Shares and are not eligible
for the dividends-received deduction.

- 46 -

<PAGE>

Certain dividends declared by a Fund in October, November or December and
paid during the following January will be treated as having been received
by Shareholders on December 31 in the year the distributions were declared.
Reinvested distributions will be taxable as if they had been received in
cash.

Each Fund may be required to withhold federal income tax at the rate of 31%
of all taxable distributions paid to Shareholders who fail to provide a
Fund with their correct taxpayer identification number or to make required
certifications or who have been notified by the Internal Revenue Service
("IRS") that they are subject to backup withholding. Corporate Shareholders
and certain other Shareholders specified in the Code are exempt from backup
withholding. Backup withholding is not an additional tax and any amounts
withheld may be credited against the Shareholder's federal income tax
liability.

Shareholders of the Funds should be aware that under the laws of some state
and local taxing authorities, distributions from a Fund that are
attributable to interest earned on certain U.S. Government securities may
not be subject to state or local taxes. Shareholders also should be aware
that under the laws of some state and local taxing authorities,
distributions from the Funds that are attributable to interest on state and
municipal securities issued within the Shareholder's own state may not be
subject to state or local taxes.

Shareholders will be furnished annually with information relating to the
nature and amounts of distributions made by a Fund.

- 47 -

<PAGE>

to state, local and foreign taxes, and non-U.S. Shareholders may be subject to
U.S. tax rules that differ significantly from those summarized herein.
Prospective Shareholders should consult their tax advisers with respect to the
effect of investing in a Fund. For additional information relating to taxes,
see "ADDITIONAL INFORMATION--Additional Tax Information" in the Statement of
Additional Information.

GENERAL INFORMATION

Organization of the Trust

The Trust was organized as a Massachusetts business trust in 1994 and
consists of seventeen funds. The Shares of each of the Funds are offered
in three separate classes: Class A Shares, Class C Shares and Class Y
Shares. Shares of the Equity Funds and the Income Funds also are offered
in Class A Shares, Class C Shares and Class Y Shares, while Shares of the
Money Funds are offered in Class A Shares, Class Q Shares and Class Y Shares.
Each Share represents an equal proportionate interest in a fund with other
Shares of the same fund, and is entitled to such dividends and distributions
out of the income earned on the assets belonging to that fund as are declared
at the discretion of the Trustees. Shares are without par value. Shareholders
are entitled to one vote for each dollar of value invested and a
proportionate fractional vote for any fraction of a dollar invested.
Shareholders will vote in the aggregate and not by fund except as otherwise
expressly required by law.

An annual or special meeting of Shareholders to conduct necessary business
is not required by the Trust's Declaration of Trust, the 1940 Act or other
authority except, under certain circumstances, to elect Trustees, amend the
Declaration of Trust, approve an investment advisory agreement and to
satisfy certain other requirements. To the extent that such a meeting is
not required, the Trust may elect not to have an annual or special meeting.

The Trust will call a special meeting of Shareholders for purposes of
considering the removal of one or more Trustees upon written request
therefor from Shareholders holding not less than 10% of the outstanding
votes of the Trust. At such a meeting, a quorum of Shareholders
(constituting a majority of votes attributable to all outstanding Shares of
the Trust), by majority vote, has the power to remove one or more Trustees.

- 48 -

<PAGE>

Multiple Classes of Shares

Each Fund intends to seek a ruling from the IRS to the effect that
differing distributions among the classes of its Shares will not result in
the Fund's dividends or other distributions being regarded as "preferential
dividends" under the Code. While similar rulings have been issued by the
IRS, complete assurance cannot, of course, be given that the Funds will
receive such rulings. For additional information, see the Statement of
Additional Information.

Performance Information

From time to time performance information for the Funds showing their
average annual total return, aggregate total return and/or yield may be
presented in advertisements, sales literature and Shareholder reports.
Such performance figures are based on historical earnings and are not
intended to indicate future performance. Also, from time to time the Funds
may present their respective distribution rates for a class of Shares in
supplemental sales literature which is accompanied or preceded by a
prospectus and in Shareholder reports.

- 49 -

<PAGE>

Investors may also judge the performance of any class of Shares or Fund by
comparing or referencing it to the performance of other mutual funds with
comparable investment objectives and policies through various mutual fund
or market indices such as those prepared by various services, which indices
may be published by such services or by other services or publications,
including, but not limited to, ratings published by Morningstar, Inc. In
addition to performance information, general information about the Funds
that appears in such publications may be included in advertisements, in
sales literature and in reports to Shareholders. For further information
regarding such services and publications, see "ADDITIONAL INFORMATION --
Performance Comparisons" in the Statement of Additional Information.

Total return and yield are functions of the type and quality of instruments
held in the portfolio, operating expenses, and market conditions. Any fees
charged with respect to customer accounts for investing in Shares of the
Funds will not be included in performance calculations; such fees, if
charged, will reduce the actual performance from that quoted. In addition,
if Qualivest and BISYS voluntarily reduce all or a part of their respective
fees, the total return of such Fund will be higher than it would otherwise
be in the absence of such voluntary fee reductions.

Account Services

Shareholders of the Trust may obtain current price, yield and other
performance information on the Funds or any of the Trust's funds 24 hours a
day by calling 1-800-743-8637 from any touch-tone telephone.

Miscellaneous

Shareholders will receive unaudited semi-annual reports and annual reports
audited by independent public accountants. Inquiries regarding the Trust
may be directed in writing to Qualivest Funds at 3435 Stelzer Road,
Columbus, Ohio 43219-3035, or by calling toll free 1-800-743-8637.

No person has been authorized to give any information or to make any
representations not contained in this Prospectus 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 by their Distributor in any jurisdiction in which
such offering may not lawfully be made.

- 50 -

<PAGE>

SUBJECT TO COMPLETION: DATED ____________

Qualivest Funds

3435 Stelzer Road
Columbus, Ohio 43219-3035
1-800-743-8637

STATEMENT OF ADDITIONAL INFORMATION

___________, 1996

This Statement of Additional Information ("SAI") describes the seventeen
diversified investment portfolios (the "Funds") of Qualivest Funds (the
"Trust"), all of which are advised by Qualivest Capital Management, Inc.
("Qualivest"). The Funds are:

. Qualivest U.S. Treasury Money Market . Qualivest Micro Cap Value Fund
Fund . Qualivest Income Equity Value
. Qualivest Money Market Fund Fund
. Qualivest Tax-Free Money Market Fund . Qualivest International
. Qualivest Intermediate Bond Fund Opportunities Fund
. Qualivest Diversified Bond Fund . Qualivest Optimized Stock Fund
. Qualivest Tax-Free National Bond Fund . Qualivest Conservative Fund
. Qualivest Large Companies Value Fund . Qualivest Balanced Fund
. Qualivest Large Companies Growth Fund . Qualivest Growth Fund
. Qualivest Small Companies Value Fund . Qualivest Aggressive Growth Fund

The Trust offers an indefinite number of transferable units ("Shares") of
each Fund, and each Fund offers multiple classes of Shares. Shares of the
Qualivest Tax-Free National Bond Fund and the Qualivest Income Equity Value Fund
are not currently offered for sale. This SAI describes all classes of Shares
offered by the Trust.

This SAI is not a Prospectus and is authorized for distribution only when
preceded or accompanied by the Prospectuses (the "Prospectuses") of the Funds,
each of which is dated or supplemented the date hereof. This SAI contains more
detailed information than that set forth in the Prospectuses and should be read
in conjunction with the Prospectuses. This SAI is incorporated by reference in
its entirety into the Prospectuses. Copies of each of the Prospectuses may be
obtained by writing the Trust at 3435 Stelzer Road, Columbus, Ohio 43219, or by
telephoning toll free 1-800-743-8637.

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS STATEMENT OF ADDITIONAL INFORMATION SHALL NOT CONSTITUTE AN
OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY
SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR
SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE
SECURITIES LAWS OF ANY SUCH STATE.

<PAGE>

TABLE OF CONTENTS
-----------------

Page

INVESTMENT POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Additional Information on the Parent Funds' Investment Policies . . .
Additional Information on Portfolio Instruments of the Equity, Income
and Money Funds . . . . . . . . . . . . . . . . . . . . . . . . .
Investment Restrictions . . . . . . . . . . . . . . . . . . . . . . .
Portfolio Turnover . . . . . . . . . . . . . . . . . . . . . . . . . .

NET ASSET VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Valuation of the Trust's Money Funds . . . . . . . . . . . . . . . . .
Valuation of the Other Funds . . . . . . . . . . . . . . . . . . . . .

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION . . . . . . . . . . . . . .
Matters Affecting Redemption . . . . . . . . . . . . . . . . . . . . .

MANAGEMENT OF THE TRUST . . . . . . . . . . . . . . . . . . . . . . . . . .
Trustees and Officers . . . . . . . . . . . . . . . . . . . . . . . .
Remuneration of Trustees . . . . . . . . . . . . . . . . . . . . . . .
Investment Adviser . . . . . . . . . . . . . . . . . . . . . . . . . .
Portfolio Transactions . . . . . . . . . . . . . . . . . . . . . . . .
Glass-Steagall Act . . . . . . . . . . . . . . . . . . . . . . . . . .
Administrator . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Distributor . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Custodians, Transfer Agent and Fund Accounting Services . . . . . . .
Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Legal Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ADDITIONAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . .
Description of Shares . . . . . . . . . . . . . . . . . . . . . . . .
Vote of a Majority of the Outstanding Shares . . . . . . . . . . . . .
Principal Shareholders . . . . . . . . . . . . . . . . . . . . . . . .
Shareholder and Trustee Liability . . . . . . . . . . . . . . . . . .
Additional Tax Information . . . . . . . . . . . . . . . . . . . . . .
Yields of the Money Funds . . . . . . . . . . . . . . . . . . . . . .
Yields of the Parent Funds, the Equity Funds and the Income Funds . .
Calculation of Total Return . . . . . . . . . . . . . . . . . . . . .
Distribution Rates . . . . . . . . . . . . . . . . . . . . . . . . . .
Performance Comparisons . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . .

APPENDIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

<PAGE>

The Qualivest Funds (the "Trust") is an open-end management investment
company which offers seventeen separate diversified investment portfolios
(collectively, the "Funds" and singly, a "Fund"), each with a different
investment objective. The Funds enable the Trust to meet a wide range of
investment needs. This SAI contains information about each of the following
Funds: the Qualivest Conservative Fund (the "Conservative Fund"), the Qualivest
Balanced Fund (the "Balanced Fund"), the Qualivest Growth Fund (the "Growth
Fund") and the Qualivest Aggressive Growth Fund (the "Aggressive Growth Fund")
(collectively, the "Parent Funds"); the Qualivest Large Companies Value Fund
(the "Large Companies Value Fund"), the Qualivest Large Companies Growth Fund
(the "Large Companies Growth Fund"), the Qualivest Small Companies Value Fund
(the "Small Companies Fund"), the Qualivest Micro Cap Value Fund (the "Micro Cap
Fund"), the Qualivest Income Equity Value Fund (the "Income Equity Fund"), the
Qualivest International Opportunities Fund (the "International Fund") and the
Qualivest Optimized Stock Fund (the "Optimized Fund") (collectively, the "Equity
Funds"); the Qualivest Intermediate Bond Fund (the "Intermediate Bond Fund"),
the Qualivest Diversified Bond Fund (the "Bond Fund") and the Qualivest Tax-Free
National Bond Fund (the "Tax-Free Bond Fund") (collectively, the "Income
Funds"); and the Qualivest U.S. Treasury Money Market Fund (the "U.S. Treasury
Fund"), the Qualivest Money Market Fund (the "Money Market Fund") and the
Qualivest Tax-Free Money Market Fund (the "Tax-Free Money Market Fund")
(collectively, the "Money Funds)."

Much of the information contained in this SAI expands upon subjects
discussed in the Prospectuses of the Funds. Capitalized terms not defined
herein are defined in such Prospectuses. No investment in Shares of a Fund
should be made without first reading the Fund's Prospectus.

INVESTMENT POLICIES

Additional Information on the Parent Funds' Investment Policies
- ---------------------------------------------------------------

Each Parent Fund seeks its investment objective by investing in a
diversified portfolio of one or more of the following Funds: the Large
Companies Value Fund, the Small Companies Fund, the International Fund, the
Optimized Fund, the Intermediate Bond Fund, the Bond Fund, the U.S. Treasury
Fund and the Money Market Fund (the "Underlying Funds"). Accordingly, the
investment performance of each Parent Fund is directly related to the
performance of the Underlying Funds, which may engage in the investment
techniques described below. In addition to Shares of the Underlying Funds, for
temporary cash management purposes, each Parent Fund may invest in short-term
obligations (with maturities of 12 months or less) consisting of commercial
paper (including variable amount master demand notes), bankers' acceptances,
certificates of deposit, repurchase agreements, obligations issued or guaranteed
by the U.S. Government or its agencies or instrumentalities, asset-backed and
mortgage-related securities, and demand and time deposits of domestic and
foreign banks and savings and loan associations. The Parent Funds also may hold
depositary or custodial receipts representing beneficial interests in any of the
foregoing securities. These investments are described below under "Additional
Information on Portfolio Instruments of the Equity, Income and Money Funds."

Additional Information on Portfolio Instruments of the Equity, Income and Money
- -------------------------------------------------------------------------------
Funds
- -----

<PAGE>

The following policies supplement the investment objectives and policies of
each of the Equity, Income and Money Funds of the Trust as set forth in the
respective Prospectuses for these Funds.

General. The Equity, Income and Money Funds will not acquire portfolio
-------
securities issued by, make savings deposits in, or enter into repurchase,
reverse repurchase, or dollar roll agreements with affiliates of the Funds,
except that the Optimized Fund may invest in such securities if they are
included in the S&P 500 Index.

Bank Obligations. All Funds may invest in bank obligations consisting of
----------------
bankers' acceptances, certificates of deposit, and time deposits.

Bankers' acceptances are negotiable drafts or bills of exchange typically
drawn by an importer or exporter to pay for specific merchandise, which are
"accepted" by a bank, meaning, in effect, that the bank unconditionally agrees
to pay the face value of the instrument on maturity. Bankers' acceptances
invested in by the Funds will be those guaranteed by domestic and foreign banks
having, at the time of investment, capital, surplus, and undivided profits in
excess of $100,000,000 (as of the date of their most recently published
financial statements).

Certificates of deposit are negotiable certificates issued against funds
deposited in a commercial bank or a savings and loan association for a definite
period of time and earning a specified return. Certificates of deposit and time
deposits will be those of domestic and foreign banks and savings and loan
associations, if (a) at the time of investment the depository institution has
capital, surplus, and undivided profits in excess of $100,000,000 (as of the
date of its most recently published financial statements), or (b) the principal
amount of the instrument is insured in full by the Federal Deposit Insurance
Corporation.

The Funds may also invest in Eurodollar Certificates of Deposit, which are
U.S. dollar denominated certificates of deposit issued by offices of foreign and
domestic banks located outside the United States; Yankee Certificates of
Deposit, which are certificates of deposit issued by a U.S. branch of a foreign
bank denominated in U.S. dollars and held in the United States; Eurodollar Time
Deposits ("ETDs"), which are U.S. dollar denominated deposits in a foreign
branch of a U.S. bank or a foreign bank; and Canadian Time Deposits, which are
basically the same as ETDs, except they are issued by Canadian offices of major
Canadian banks.

Commercial Paper. Commercial paper consists of unsecured promissory notes
----------------
issued by corporations. Except as noted below with respect to variable amount
master demand notes, issues of commercial paper normally have maturities of less
than nine months and fixed rates of return.

Variable Amount Master Demand Notes. Variable amount master demand notes,
-----------------------------------
in which the Funds may invest, are unsecured demand notes that permit the
indebtedness thereunder to vary and provide for periodic adjustments in the
interest rate according to the terms of the instrument. Because master demand
notes are direct lending arrangements between a Fund and the issuer, they

<PAGE>

are not normally traded. Although there is no secondary market in the notes, a
Fund may demand payment of principal and accrued interest at any time. While
the notes are not typically rated by credit rating agencies, issuers of variable
amount master demand notes (which are normally manufacturing, retail, financial,
and other business concerns) must satisfy the same criteria as set forth above
for commercial paper. Qualivest will consider the earning power, cash flow, and
other liquidity ratios of the issuers of such notes and will continuously
monitor their financial status and ability to meet payment on demand. In
determining dollar weighted average portfolio maturity, a variable amount master
demand note will be deemed to have a maturity equal to the longer of the period
of time remaining until the next interest rate adjustment or the period of time
remaining until the principal amount can be recovered from the issuer through
demand.

Foreign Investments. Investment in foreign securities is subject to
-------------------
special investment risks that differ in some respects from those related to
investments in securities of U.S. domestic issuers.

Because foreign companies are not subject to uniform accounting, auditing
and financial reporting standards, practices and requirements comparable to
those applicable to U.S. companies, there may be less publicly available
information about a foreign company than about a U.S. company. Volume and
liquidity in most foreign markets are less than in the U.S., and securities of
many foreign companies are less liquid and more volatile than securities of
comparable U.S. companies. Fixed commissions on foreign securities exchanges
are generally higher than negotiated commissions on U.S. exchanges, although the
Equity, Income and Money Funds endeavor to achieve the most favorable net
results on portfolio transactions. There is generally less government
supervision and regulation of securities exchanges, brokers, dealers and listed
companies than in the U.S., thus increasing the risk of delayed settlements of
portfolio transactions or loss of certificates for portfolio securities.

Foreign markets also have different clearance and settlement procedures,
and in certain markets, there have been times when settlements have been unable
to keep pace with the volume of securities transactions, making it difficult to
conduct such transactions. Such delays in settlement could result in temporary
periods when a portion of the assets of a Fund is uninvested and no return is
earned thereon. The inability of a Fund to make intended security purchases due
to settlement problems could cause such Fund to miss attractive investment
opportunities. Losses to a Fund due to subsequent declines in the value of
portfolio securities, or losses arising out of the Fund's inability to fulfill a
contract to sell such securities, could result in potential liability to the
Fund. In addition, with respect to certain foreign countries, there is the
possibility of expropriation or confiscatory taxation, political or social
instability, or diplomatic developments which could affect a Fund's investments
in those countries. Moreover, individual foreign economies may differ favorably
or unfavorably from the U.S. economy in such respects as growth of gross
national product, rate of inflation, capital reinvestment, resource self-
sufficiency and balance of payments position.

<PAGE>

In many instances, foreign debt securities may provide higher yields than
securities of domestic issuers which have similar maturities and quality. Under
certain market conditions these investments may be less liquid than the
securities of U.S. corporations and are certainly less liquid than securities
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities. Finally, in the event of a default of any such foreign debt
obligations, it may be more difficult for a Fund to obtain or to enforce a
judgment against the issuers of such securities.

A change in the value of any foreign currency against the U.S. dollar will
result in a corresponding change in the U.S. dollar value of a Fund's securities
denominated in that currency. Such changes will also affect a Fund's income and
distributions to Shareholders. In addition, although a Fund will receive income
on foreign securities in such currencies, such Fund will be required to compute
and distribute its income in U.S. dollars. Therefore, if the exchange rate for
any such currency declines materially after such Fund's income has been accrued
and translated into U.S. dollars, the Fund could be required to liquidate
portfolio securities to make required distributions. Similarly, if an exchange
rate declines between the time a Fund incurs expenses in U.S. dollars and the
time such expenses are paid, the amount of such currency required to be
converted into U.S. dollars in order to pay such expenses in U.S. dollars will
be greater.

In general, there is a large, liquid market in the United States for many
American Depositary Receipts ("ADRs"). The information available for ADRs is
subject to the accounting, auditing and financial reporting standards of the
domestic market or exchange on which they are traded, which standards are more
uniform and more exacting than those to which many foreign issuers may be
subject. Certain of the ADRs in which the Equity Funds, except for the
Optimized Fund, may invest, typically those denominated as unsponsored, require
the holders thereof to bear most of the costs of such facilities, while issuers
of sponsored facilities normally pay more of the costs thereof. The depositary
of an unsponsored facility frequently is under no obligation to distribute
shareholder communications received from the issuer of the deposited securities
or to pass through the voting rights to facility holders with respect to the
deposited securities, whereas the depositary of a sponsored facility typically
distributes shareholder communications and passes through the voting rights.

Variable and Floating Rate Notes. The Money Funds and the Tax-Free Bond
--------------------------------
Fund may acquire variable and floating rate notes, subject to each such Fund's
investment objective, policies and restrictions. A variable rate note is one
whose terms provide for the adjustment of its interest rate on set dates and
which, upon such adjustment, can reasonably be expected to have a market value
that approximates its par value. A floating rate note is one whose terms
provide for the adjustment of its interest rate whenever a specified interest
rate changes and which, at any time, can reasonably be expected to have a market
value that approximates its par value. Such notes are frequently not rated by
credit rating agencies; however, unrated variable and floating rate notes
purchased by a Fund will be determined by Qualivest, under guidelines
established by the Trust's Board of Trustees, to be of comparable quality at the
time of purchase to rated instruments eligible for purchase under the Fund's
investment policies. In making such determinations, the investment adviser will
consider the earning power, cash flow and other liquidity ratios of the

<PAGE>

issuers of such notes (such issuers include financial, merchandising, bank
holding and other companies) and will continuously monitor their financial
condition. Although there may be no active secondary market with respect to a
particular variable or floating rate note purchased by a Fund, it may resell the
note at any time to a third party. The absence of an active secondary market,
however, could make it difficult for the Fund to dispose of a variable or
floating rate note in the event the issuer of the note defaulted on its payment
obligations and the Fund could, as a result or for other reasons, suffer a loss
to the extent of the default. To the extent that the Fund is not entitled to
receive the principal amount of a note within seven days, such note will be
treated as an illiquid security for purposes of calculation of the limitation on
the Fund's investment in illiquid securities as set forth in that Fund's
investment restrictions. Variable or floating rate notes may be secured by bank
letters of credit.

Variable or floating rate notes invested in by the Money Funds may have
maturities of more than 397 days, as follows:

1. An instrument that is issued or guaranteed by the U.S. Government or
any agency thereof which has a variable rate of interest readjusted no less
frequently than every 397 days will be deemed by a Money Fund to have a maturity
equal to the period remaining until the next readjustment of the interest rate.

2. A variable rate note, the principal amount of which is scheduled on
the face of the instrument to be paid in 397 days or less, will be deemed by a
Money Fund to have a maturity equal to the period remaining until the next
readjustment of the interest rate.

3. A variable rate note that is subject to a demand feature will be
deemed by a Money Fund to have a maturity equal to the longer of the period
remaining until the next readjustment of the interest rate or the period
remaining until the principal amount can be recovered through demand.

4. A floating rate note that is subject to a demand feature will be
deemed by a Money Fund to have a maturity equal to the period remaining until
the principal amount can be recovered through demand.

As used above, a note is "subject to a demand feature" where the Fund is
entitled to receive the principal amount of the note either at any time on no
more than 30 days' notice or at specified intervals not exceeding 397 days.

Money Market Funds. Each of the Equity and Income Funds may invest up to
------------------
5% of the value of its total assets in the securities of any one money market
fund (including shares of the U.S. Treasury Fund, the Money Market Fund and the
Tax-Free Money Market Fund), provided that no more than 10% of such Fund's total
assets may be invested in the securities of money market funds in the aggregate.
Each of the Money Funds may invest up to 25% of its total assets in the
securities of money market funds.

<PAGE>

In order to avoid the imposition of additional fees as a result of
investments by the Equity and Income Funds in Shares of the Money Funds of the
Trust, Qualivest, BISYS Fund Services ("BISYS" or "Distributor" or
"Administrator"), and their affiliates will not retain any portion of their
usual service fees from the Funds that are attributable to investments by these
Funds in Shares of those Money Funds. The Equity and Income Funds will incur no
sales charges, contingent deferred sales charges, 12b-1 fees, or other
underwriting or distribution fees in connection with their investments in the
Money Funds of the Trust. These Funds will vote their Shares of each of the
Money Funds of the Trust in proportion to the vote by all other Shareholders of
such Money Fund. Moreover, no single Fund of the Trust may own more than 3% of
the outstanding Shares of any single Money Fund of the Trust.

Municipal Securities. As stated in the Prospectuses of the Tax-Free Money
--------------------
Market and Tax-Free Bond Funds (collectively, the "Exempt Funds" and singly, an
"Exempt Fund"), the assets of the Exempt Funds will be primarily invested in
bonds and notes issued by or on behalf of states (including the District of
Columbia), territories, and possessions of the United States and their
respective authorities, agencies, instrumentalities, and political subdivisions,
the interest on which is both exempt from federal income tax and not treated as
a preference item for purposes of the federal alternative minimum tax
("Municipal Securities"). With respect to the Tax-Free Money Market Fund,
Municipal Securities are expected to have remaining maturities of 397 days or
less. Under normal market conditions, at least 80% of the net assets of each
such Exempt Fund will be invested in Municipal Securities.

Municipal Securities include debt obligations issued by governmental
entities to obtain funds for various public purposes, such as the construction
of a wide range of public facilities, the refunding of outstanding obligations,
the payment of general operating expenses, and the extension of loans to other
public institutions and facilities. Private activity bonds that are issued by
or on behalf of public authorities to finance various privately-operated
facilities are included within the term Municipal Securities if the interest
paid thereon is exempt from both federal income tax and not treated as a
preference item for purposes of the federal alternative minimum tax.

Among other types of Municipal Securities, the Exempt Funds may purchase
short-term General Obligation Notes, Tax Anticipation Notes, Bond Anticipation
Notes, Revenue Anticipation Notes, Project Notes, Tax-Exempt Commercial Paper,
Construction Loan Notes and other forms of short-term tax-exempt loans. Such
instruments are issued with a short-term maturity in anticipation of the receipt
of tax funds, the proceeds of bond placements or other revenues. In addition,
the Exempt Funds may invest in other types of tax-exempt instruments, such as
municipal bonds, private activity bonds, and pollution control bonds.

Project Notes are issued by a state or local housing agency and are sold by
the Department of Housing and Urban Development. While the issuing agency has
the primary obligation with respect to its Project Notes, they are also secured
by the full faith and credit of the United States through agreements with the
issuing authority which provide that, if required, the federal

<PAGE>

government will lend the issuer an amount equal to the principal of and interest
on the Project Notes.

As described in the Prospectuses of the Exempt Funds, the two principal
classifications of Municipal Securities consist of "general obligation" and
"revenue" issues. The Exempt Funds may also acquire "moral obligation" issues,
which are normally issued by special purpose authorities. There are, of course,
variations in the quality of Municipal Securities, both within a particular
classification and between classifications, and the yields on Municipal
Securities depend upon a variety of factors, including general money market
conditions, the financial condition of the issuer, general conditions of the
municipal bond market, the size of a particular offering, the maturity of the
obligation and the rating of the issue. The ratings of a nationally recognized
statistical rating organization ("NRSRO") represent its opinion as to the
quality of Municipal Securities. It should be emphasized, however, that ratings
are general and are not absolute standards of quality, and Municipal Securities
with the same maturity, interest rate and rating may have different yields,
while Municipal Securities of the same maturity and interest rate with different
ratings may have the same yield. Subsequent to purchase, an issue of Municipal
Securities may cease to be rated or its rating may be reduced below the minimum
rating required for purchase. Qualivest will consider such an event in
determining whether an Exempt Fund should continue to hold the obligation.

An issuer's obligations under Municipal Securities are subject to the
provisions of bankruptcy, insolvency, and other laws affecting the rights and
remedies of creditors, such as the federal bankruptcy code, and laws, if any,
which may be enacted by Congress or state legislatures extending the time for
payment of principal or interest, or both, or imposing other constraints upon
the enforcement of such obligations or upon the ability of municipalities to
levy taxes. The power or ability of an issuer to meet its obligations for the
payment of interest on and principal of Municipal Securities may be materially
adversely affected by litigation or other conditions.

Municipal Lease Obligations. The Tax-Free Bond Fund may invest up to 5% of
---------------------------
its total assets in municipal lease obligations, including certificates of
participation, which finance a variety of public projects. Because of the way
these instruments are structured, they carry a greater risk than other types of
Municipal Securities. The Tax-Free Bond Fund may invest in municipal lease
obligations only when they are rated by an NRSRO or are deemed by Qualivest,
pursuant to guidelines adopted by the Board of Trustees, to be of a quality
compatible with the Fund's quality standards. Prior to purchasing a municipal
lease obligation and on a regular basis thereafter, Qualivest will evaluate the
credit quality and liquidity of the security. In making its evaluation,
Qualivest will consider various credit factors, such as the necessity of the
project, the municipality's credit quality, future borrowing plans, sources of
revenue pledged for lease repayment, general economic conditions in the region
where the security is issued, and liquidity factors, such as dealer activity.

U.S. Government Obligations. Each of the Funds may invest in obligations
---------------------------
issued or guaranteed by the U.S. Government or its agencies and
instrumentalities, including bills, notes

<PAGE>

and bonds issued by the U.S. Treasury, as well as "stripped" U.S. Treasury
obligations such as Treasury Receipts issued by the U.S. Treasury representing
either future interest or principal payments. Stripped securities are issued at
a discount to their "face value," and may exhibit greater price volatility than
ordinary debt securities because of the manner in which their principal and
interest are returned to investors. The stripped Treasury obligations in which
the Funds may invest do not include Certificates of Accrual on Treasury
Securities ("CATS") or Treasury Income Growth Receipts ("TIGRs").

Obligations of certain agencies and instrumentalities of the U.S.
Government are supported by the full faith and credit of the U.S. Treasury;
others are supported by the right of the issuer to borrow from the Treasury;
others are supported by the discretionary authority of the U.S. Government to
purchase the agency's obligations; and still others are supported only by the
creditworthiness of the instrumentality. No assurance can be given that the
U.S. Government would provide financial support to U.S. Government-sponsored
agencies or instrumentalities if it is not obligated to do so by law. The Funds
will invest in the obligations of such agencies or instrumentalities only when
Qualivest believes that the credit risk with respect thereto is minimal.

Taxable Obligations. As stated in the Prospectuses of each of the Exempt
-------------------
Funds, under normal market conditions, each Exempt Fund may invest up to 20% of
its net assets in Taxable Obligations. Taxable Obligations may include (1)
obligations of the U.S. Treasury; (2) obligations of agencies and instrumen-
talities of the U.S. Government; (3) money market instruments, such as
certificates of deposit issued by domestic banks, corporate commercial paper,
and bankers' acceptances; and (4) taxable instruments subject to repurchase
agreements (agreements under which the seller agrees at the time of sale to
repurchase the securities it is selling at an agreed time and price).
Certificates of deposit will be those of domestic branches of U.S. banks which
are members of the Federal Reserve System or the Federal Deposit Insurance
Corporation and which have total assets at the time of purchase in excess of
$100,000,000, or of savings and loan associations which are members of the
Federal Deposit Insurance Corporation and which have total assets at the time of
purchase in excess of $100,000,000. Bankers' acceptances will be guaranteed by
U.S. commercial banks having total assets at the time of purchase in excess of
$100,000,000.

Options Trading. The Equity Funds and the Income Funds may purchase put
---------------
and call options. A call option gives the purchaser the right to buy, and a
writer has the obligation to sell, the underlying security or foreign currency
at the stated exercise price at any time prior to the expiration of the option,
regardless of the market price or exchange rate of the security or foreign
currency, as the case may be. The premium paid to the writer is consideration
for undertaking the obligations under the option contract. A put option gives
the purchaser the right to sell the underlying security or foreign currency at
the stated exercise price at any time prior to the expiration date of the
option, regardless of the market price or exchange rate of the security or
foreign currency, as the case may be. Put and call options purchased by the
foregoing Funds will be valued at the last sale price, or in the absence of such
a price, at the mean between bid and asked price.

<PAGE>

When a Fund writes an option, an amount equal to the net premium (the
premium less the commission) received by the Fund is included in the liability
section of its statement of assets and liabilities as a deferred credit. The
amount of the deferred credit will be subsequently marked-to-market to reflect
the current value of the option written. The current value of the traded option
is the last sale price or, in the absence of a sale, the average of the closing
bid and asked prices. If an option expires on the stipulated expiration date,
or if a Fund enters into a closing purchase transaction, it will realize a gain
(or a loss if the cost of a closing purchase transaction exceeds the net premium
received when the option is sold) and the deferred credit related to such option
will be eliminated. If an option is exercised, the Fund may deliver the
underlying security in the open market. In either event, the proceeds of the
sale will be increased by the net premium originally received and the Fund will
realize a gain or loss.

The Equity Funds, the Intermediate Bond Fund, and the Bond Fund also may
purchase or sell index options. Index options (or options on securities
indices) are similar in many respects to options on securities except that an
index option gives the holder the right to receive, upon exercise, cash instead
of securities, if the closing level of the securities index upon which the
option is based is greater than, in the case of a call, or less than, in the
case of a put, the exercise price of the option.

Puts. Each Exempt Fund may acquire "puts" with respect to Municipal
----
Securities held in its portfolio. A put is a right to sell a specified security
(or securities) within a specified period of time at a specified exercise price.
The Exempt Funds may sell, transfer, or assign a put only in conjunction with
the sale, transfer, or assignment of the underlying security or securities.

The amount payable to an Exempt Fund upon its exercise of a put is normally
(i) the Exempt Fund's acquisition cost of the Municipal Securities (excluding
any accrued interest which the Exempt Fund paid on the acquisition), less any
amortized market premium or plus any amortized market or original issue discount
during the period the Exempt Fund owned the securities, plus (ii) all interest
accrued on the securities since the last interest payment date during that
period.

Puts may be acquired by such Funds to facilitate the liquidity of their
respective portfolio assets. Puts may also be used to facilitate the
reinvestment of an Exempt Fund's assets at a rate of return more favorable than
that of the underlying security. Puts may, under certain circumstances, also be
used to shorten the maturity of underlying variable rate or floating rate
securities for purposes of calculating the remaining maturity of those
securities and the dollar weighted average portfolio maturity of the Tax-Free
Money Market Fund's assets pursuant to Rule 2a-7 under the Investment Company
Act of 1940, as amended ("1940 Act"). See "INVESTMENT POLICIES -- Additional
Information on Portfolio Instruments -- Variable and Floating Rate Notes" and
"NET ASSET VALUE" in this SAI.

The Exempt Funds expect that each such Fund will generally acquire puts
only where the puts are available without the payment of any direct or indirect
consideration. However, if

<PAGE>

necessary or advisable, the Exempt Funds may pay for puts either separately in
cash or by paying a higher price for portfolio securities which are acquired
subject to the puts (thus reducing the yield to maturity otherwise available for
the same securities).

The Exempt Funds intend to enter into puts only with banks and broker-
dealers which, in Qualivest's opinion, present minimal credit risks.

When-Issued and Delayed-Delivery Securities. Each Equity, Income and Money
-------------------------------------------
Fund may purchase securities on a "when-issued" or "delayed-delivery" basis
(i.e., for delivery beyond the normal settlement date at a stated price and
----
yield). When a Fund agrees to purchase securities on a "when-issued" or
"delayed-delivery" basis, its custodian will set aside cash or high grade liquid
debt securities equal to the amount of the commitment in a separate account.
Normally, the custodian will set aside securities to satisfy the purchase
commitment, and in such a case, the Fund may be required subsequently to place
additional assets in the separate account in order to assure that the value of
the account remains equal to the amount of the Fund's commitment. It may be
expected that the Fund's net assets will fluctuate to a greater degree when it
sets aside securities to cover such purchase commitments than when it sets aside
cash. In addition, because the Fund will set aside cash or high grade liquid
debt securities to satisfy its purchase commitments in the manner described
above, its liquidity and the ability of Qualivest to manage it might be affected
in the event its commitments to purchase "when-issued" or "delayed-delivery"
securities ever exceeded 25% of the value of its assets. Under normal market
conditions, however, a Fund's commitments to purchase "when-issued" or "delayed-
delivery" securities will not exceed 25% of the value of its assets.

If the Fund sells a "when-issued" or "delayed-delivery" security before a
delivery, any gain would not be tax-exempt. When the Fund engages in "when-
issued" or "delayed-delivery" transactions, it relies on the seller to
consummate the trade. Failure of the seller to do so may result in the Fund
incurring a loss or missing the opportunity to obtain a price considered to be
advantageous.

Mortgage-Related Securities. Each Fund except the Optimized Fund and the
---------------------------
International Fund may, consistent with its investment objective and policies,
invest in mortgage-related securities issued or guaranteed by the U.S.
Government or its agencies and instrumentalities. In addition, these Funds may
invest in mortgage-related securities issued by nongovernmental entities;
provided, however, that to the extent a Fund purchases mortgage-related
securities from such issuers which may, solely for purposes of the 1940 Act, be
deemed to be investment companies, its investment in such securities will be
subject to the limitations on its investment in investment company securities.

Mortgage-related securities, for purposes of the Funds' Prospectuses and
this SAI, represent pools of mortgage loans assembled for sale to investors by
various governmental agencies such as the Government National Mortgage
Association ("GNMA") and government-related organizations such as the Federal
National Mortgage Association ("FNMA") and the

<PAGE>

Federal Home Loan Mortgage Corporation ("FHLMC"), as well as by nongovernmental
issuers such as commercial banks, savings and loan institutions, mortgage
bankers and private mortgage insurance companies. Although certain mortgage-
related securities are guaranteed by a third party or otherwise similarly
secured, the market value of the security, which may fluctuate, is not so
secured. If a Fund purchases a mortgage-related security at a premium, that
portion may be lost if there is a decline in the market value of the security,
whether resulting from changes in interest rates or prepayments in the
underlying mortgage collateral. As with other interest-bearing securities, the
prices of such securities are inversely affected by changes in interest rates.
However, though the value of a mortgage-related security may decline when
interest rates rise, the converse is not necessarily true, since in periods of
declining interest rates the mortgages underlying the securities are prone to
prepayment, thereby shortening the average life of the security and shortening
the period of time over which income at the higher rate is received. When
interest rates are rising, though, the rate of prepayment tends to decrease,
thereby lengthening the period of time over which income at the lower rate is
received. For these and other reasons, a mortgage-related security's average
maturity may be shortened or lengthened as a result of interest rate
fluctuations and, therefore, it is not possible to predict accurately the
security's return to the Funds. In addition, regular payments received in
respect of mortgage-related securities include both interest and principal. No
assurance can be given as to the return the Funds will receive when these
amounts are reinvested.

There are a number of important differences among the agencies and
instrumentalities of the U.S. Government that issue mortgage-related securities
and among the securities that they issue. Mortgage-related securities issued by
the GNMA include GNMA Mortgage Pass-Through Certificates (also known as "Ginnie
Maes") which are guaranteed as to the timely payment of principal and interest
by GNMA and such guarantee is backed by the full faith and credit of the United
States. GNMA is a wholly owned U.S. Government corporation within the
Department of Housing and Urban Development. GNMA certificates also are
supported by the authority of GNMA to borrow funds from the U.S. Treasury to
make payments under its guarantee. Mortgage-related securities issued by the
FNMA include FNMA Guaranteed Mortgage Pass-Through Certificates (also known as
"Fannie Maes") which are solely the obligations of FNMA and are not backed by or
entitled to the full faith and credit of the United States. FNMA is a
government-sponsored organization owned entirely by private stockholders.
Fannie Maes are guaranteed as to the timely payment of the principal and
interest by FNMA. Mortgage-related securities issued by the FHLMC include FHLMC
Mortgage Participation Certificates (also known as "Freddie Macs" or "Pcs").
FHLMC is a corporate instrumentality of the United States, created pursuant to
an Act of Congress, which is owned entirely by Federal Home Loan Banks. Freddie
Macs are not guaranteed by the United States or by any Federal Home Loan Bank
and do not constitute a debt or obligation of the United States or of any
Federal Home Loan Bank. Freddie Macs entitle the holder to the timely payment
of interest, which is guaranteed by FHLMC. FHLMC guarantees either ultimate
collection or the timely payment of all principal payments on the underlying
mortgage loans. When FHLMC does not guarantee timely payment of principal,
FHLMC may remit the amount due on account of its guarantee of ultimate payment
of principal

<PAGE>

at any time after default on an underlying mortgage, but in no event later than
one year after it becomes payable.

Medium-Grade Debt Securities. As stated in the Prospectuses for the Large
----------------------------
Companies Value Fund, Large Companies Growth Fund, Small Companies Fund, Micro
Cap Fund, Income Equity Fund and each Income Fund, each of these Funds may
invest in debt securities which are within the fourth highest rating group
assigned by an NRSRO (e.g., including securities rated BBB by Standard & Poor's
----
Corporation ("S&P") or Baa by Moody's Investors Service, Inc. ("Moody's")) or,
if not rated, or are of comparable quality as determined by Qualivest.
("Medium-Grade Securities").

As with other fixed-income securities, Medium-Grade Securities are subject
to credit risk and market risk. Market risk relates to changes in a security's
value as a result of changes in interest rates. Credit risk relates to the
ability of the issuer to make payments of principal and interest. Medium-Grade
Securities are considered by Moody's to have speculative characteristics.

Medium-Grade Securities are generally subject to greater credit risk than
comparable higher-rated securities because issuers are more vulnerable to
economic downturns, higher interest rates or adverse issuer-specific
developments. In addition, the prices of Medium-Grade Securities are generally
subject to greater market risk and therefore react more sharply to changes in
interest rates. The value and liquidity of Medium-Grade Securities may be
diminished by adverse publicity and investor perceptions.

Because certain Medium-Grade Securities are traded only in markets where
the number of potential purchasers and sellers, if any, is limited, the ability
of those Funds to sell such securities at their fair market value either to meet
redemption requests or to respond to changes in the financial markets may be
limited.

Particular types of Medium-Grade Securities may present special concerns.
The prices of payment-in-kind or zero-coupon securities may react more strongly
to changes in interest rates than the prices of other Medium-Grade Securities.
Some Medium-Grade Securities in which such Funds may invest may be subject to
redemption or call provisions that may limit increases in market value that
might otherwise result from lower interest rates while increasing the risk that
those Funds may be required to reinvest redemption or call proceeds during a
period of relatively low interest rates.

The credit ratings issued by NRSROs are subject to various limitations.
For example, while such ratings evaluate credit risk, they ordinarily do not
evaluate the market risk of Medium-Grade Securities. In certain circumstances,
the ratings may not reflect in a timely fashion adverse developments affecting
an issuer. For these reasons, Qualivest conducts its own independent credit
analysis of Medium-Grade Securities.

<PAGE>

Restricted Securities. "Section 4(2) securities," as described in the
---------------------
Prospectuses, are securities that are issued in reliance on the "private
placement" exemption from registration which is afforded by Section 4(2) of the
Securities Act of 1933 (the "1933 Act"). The Funds will not purchase Section
4(2) securities which have not been determined to be liquid in excess of 15%
(10% in the case of the Money Funds) of the net assets of each Fund. The Board
of Trustees has delegated to Qualivest the day-to-day authority to determine
whether a particular issue of Section 4(2) securities that are eligible for
resale under Rule 144A under the 1933 Act should be treated as liquid. Rule
144A provides a safe-harbor exemption from the registration requirements of the
1933 Act for resales to "qualified institutional buyers" as defined in Rule
144A. With the exception of registered broker-dealers, a qualified
institutional buyer must generally own and invest on a discretionary basis at
least $100 million in securities.

Qualivest may deem Section 4(2) securities liquid if it believes that,
based on the trading markets for such security, such security can be disposed of
within seven days in the ordinary course of business at approximately the amount
at which an Equity, Income or Money Fund has valued the security. In making
such determination, Qualivest generally considers any and all factors that it
deems relevant, which may include (i) the credit quality of the issuer; (ii) the
frequency of trades and quotes for the security; (iii) the number of dealers
willing to purchase or sell the security and the number of other potential
purchasers; (iv) dealer undertakings to make a market in the security; and (v)
the nature of the security and the nature of market-place trades.

Treatment of Section 4(2) securities as liquid could have the effect of
decreasing the level of a Fund's liquidity to the extent that qualified
institutional buyers become, for a time, uninterested in purchasing these
securities.

Guaranteed Investment Contracts. When investing in guaranteed investment
-------------------------------
contracts ("GICs"), the Intermediate Bond Fund, the Bond Fund, and each of the
Money Funds make cash contributions to a deposit fund of an insurance company's
general account. The insurance company then credits to the deposit fund on a
monthly basis guaranteed interest. The GICs provide that this guaranteed
interest will not be less than a certain minimum rate. The insurance company
may assess periodic charges against a GIC for expense and service costs
allocable to it, and the charges will be deducted from the value of the deposit
fund. The Intermediate Bond Fund and the Bond Fund may invest in GICs of
insurance companies without regard to the ratings, if any, assigned to such
insurance companies' outstanding debt securities. The Money Funds may invest in
GICs issued by insurance companies whose outstanding debt securities are rated
in the first two rating categories by an NRSRO or, if not rated, that Qualivest
deems to be of comparable quality. Because a Fund may not receive the principal
amount of a GIC from the insurance company on seven days' notice or less, the
GIC is considered an illiquid investment, and, together with other instruments
held by the Fund which are deemed to be illiquid, will not exceed a Fund's
restriction on investment in illiquid securities. In determining average
portfolio maturity, GICs will be deemed to have a maturity equal to the period
of time remaining until the next readjustment of the guaranteed interest rate.

<PAGE>

Repurchase Agreements. Securities held by all of the Funds except the U.S.
---------------------
Treasury Fund may be subject to repurchase agreements. Under the terms of a
repurchase agreement, a Fund acquires securities from member banks of the
Federal Reserve System and broker-dealers that Qualivest deems creditworthy
under guidelines approved by the Board of Trustees, subject to the seller's
agreement to repurchase such securities at a mutually agreed-upon date and
price. If the seller were to default on its repurchase obligation or become
insolvent, the Fund holding such obligation could suffer a loss to the extent
that the proceeds from a sale of the underlying portfolio securities were less
than the repurchase price under the agreement. Securities subject to repurchase
agreements will be held by the Fund's custodian or another qualified custodian
or in the Federal Reserve/Treasury book-entry system.

Futures Contracts. As discussed in the Prospectuses of the Equity Funds
-----------------
and the Income Funds, each of these Funds may enter into futures contracts.
This investment technique is designed primarily to hedge against anticipated
future changes in market conditions or foreign exchange rates which otherwise
might adversely affect the value of securities which a Fund holds or intends to
purchase. For example, when interest rates are expected to rise or market
values of portfolio securities are expected to fall, a Fund can seek through the
sale of futures contracts to offset a decline in the value of its portfolio
securities. When interest rates are expected to fall or market values are
expected to rise, a Fund, through the purchase of such contracts, can attempt to
secure better rates or prices for the Fund than might later be available in the
market when it effects anticipated purchases.

The acquisition of put and call options on futures contracts will,
respectively, give a Fund the right (but not the obligation), for a specified
price, to sell or to purchase the underlying futures contract, upon exercise of
the option, at any time during the option period.

Futures transactions involve brokerage costs and require a Fund to
segregate liquid assets, such as cash, U.S. Government securities or other
liquid high grade debt obligations, to cover its obligation under such
contracts. A Fund may lose the expected benefit of futures transactions if
interest rates, securities prices or foreign exchange rates move in an
unanticipated manner. Such unanticipated changes may also result in poorer
overall performance than if the Equity or Income Fund had not entered into any
futures transactions. In addition, the value of a Fund's futures positions may
not prove to be perfectly or even highly correlated with the value of its
portfolio securities and foreign currencies, limiting its ability to hedge
effectively against interest rates, foreign exchange rates and/or market risk
and giving rise to additional risks. There is no assurance of liquidity in the
secondary market for purposes of closing out futures positions.

Forward Foreign Currency Exchange Contracts. The Large Companies Value,
-------------------------------------------
Large Companies Growth, Small Companies, Micro Cap, Income Equity and
International Funds may engage in foreign currency exchange transactions. A
forward foreign currency exchange contract involves an obligation to purchase or
sell a specific currency at a future date, which may be any fixed number of days
("Term") from the date of the contract agreed upon by the parties, at a price

<PAGE>

set at the time of the contract. These contracts are traded directly between
currency traders (usually large commercial banks) and their customers.

No such Fund intends to enter into such forward contracts if it would have
more than 10% of the value of its total assets committed to such contracts on a
regular or continuous basis. A Fund also will not enter into such forward
contracts or maintain a net exposure in such contracts where such Fund would be
obligated to deliver an amount of foreign currency in excess of the value of
such Fund's securities or other assets denominated in that currency. Qualivest
believes that it is important to have the flexibility to enter into such forward
contracts when it determines that to do so is in the best interests of a Fund.
Each such Fund's custodian bank segregates cash or liquid high grade debt
securities in an amount not less than the value of the Fund's total assets
committed to forward foreign currency exchange contracts entered into for the
purchase of a foreign security. If the value of the securities segregated
declines, additional cash or securities are added so that the segregated amount
is not less than the amount of such Fund's commitments with respect to such
contracts. These Funds generally do not enter into a forward contract with a
Term longer than one year.

Foreign Currency Options. A foreign currency option provides the Large
------------------------
Companies Value, Large Companies Growth, Small Companies, Micro Cap, Income
Equity or International Fund, as the option buyer, with the right to buy or sell
a stated amount of foreign currency at the exercise price at a specified date or
during the option period. A call option gives its owner the right, but not the
obligation, to buy the currency, while a put option gives its owner the right,
but not the obligation, to sell the currency. The option seller (writer) is
obligated to fulfill the terms of the option sold if it is exercised. However,
either seller or buyer may close its position during the option period in the
secondary market for such options any time prior to expiration.

A call rises in value if the underlying currency appreciates. Conversely,
a put rises in value if the underlying currency depreciates. While purchasing a
foreign currency option can protect a Fund against an adverse movement in the
value of a foreign currency, it does not limit the gain which might result from
a favorable movement in the value of such currency. For example, if a Fund were
holding securities denominated in an appreciating foreign currency and had
purchased a foreign currency put to hedge against a decline in the value of the
currency, it would not have to exercise its put. Similarly, if a Fund has
entered into a contract to purchase a security denominated in a foreign currency
and had purchased a foreign currency call to hedge against a rise in the value
of the currency but instead the currency had depreciated in value between the
date of purchase and the settlement date, such Fund would not have to exercise
its call but could acquire in the spot market the amount of foreign currency
needed for settlement.

Foreign Currency Futures Transactions. As part of its financial futures
-------------------------------------
transactions, the Large Companies Value, Large Companies Growth, Small
Companies, Micro Cap, Income Equity and International Funds may use foreign
currency futures contracts and options on such futures contracts. Through the
purchase or sale of such contracts, a Fund may be able to achieve many

<PAGE>

of the same objectives as through forward foreign currency exchange contracts
more effectively and possibly at a lower cost.

Unlike forward foreign currency exchange contracts, foreign currency
futures contracts and options on foreign currency futures contracts are
standardized as to amount and delivery period and may be traded on boards of
trade and commodities exchanges or directly with a dealer which makes a market
in such contracts and options. It is anticipated that such contracts may
provide greater liquidity and lower cost than forward foreign currency exchange
contracts.

Regulatory Restrictions. As required by the Securities and Exchange
-----------------------
Commission, when purchasing or selling a futures contract or writing a put or
call option or entering into a forward foreign currency exchange purchase, a
Fund will maintain in a segregated account cash or liquid high grade debt
securities equal to the value of such contracts.

To the extent required to comply with Commodity Futures Trading Commission
Regulation 4.5 and thereby avoid being classified as a "commodity pool
operator," a Fund will not enter into a futures contract or purchase an option
thereon if immediately thereafter the initial margin deposits for futures
contracts held by such Fund plus premiums paid by it for open options on futures
would exceed 5% of such Fund's total assets. A Fund will not engage in
transactions in financial futures contracts or options thereon for speculation,
but only to attempt to hedge against changes in market conditions affecting the
values of securities which such Fund holds or intends to purchase. When futures
contracts or options thereon are purchased to protect against a price increase
on securities intended to be purchased later, it is anticipated that at least
25% of such intended purchases will be completed. When other futures contracts
or options thereon are purchased, the underlying value of such contracts will at
all times not exceed the sum of: (1) accrued profit on such contracts held by
the broker; (2) cash or high quality money market instruments set aside in an
identifiable manner; and (3) cash proceeds from investments due in 30 days.

Investment Restrictions
- -----------------------

Each Fund's investment objective is fundamental and may not be changed
without a vote of the holders of a majority of the Fund's outstanding Shares.
In addition, the following investment restrictions may be changed with respect
to a particular Fund only by a vote of a majority of the outstanding Shares of
that Fund (as defined under "ADDITIONAL INFORMATION -- Vote of a Majority of the
Outstanding Shares" in this SAI).

None of the Funds will:

1. Purchase any securities which would cause more than 25% of the value
of the Fund's total assets at the time of purchase to be invested in securities
of one or more issuers conducting their principal business activities in the
same industry, provided that: (a) there is no limitation with respect to
obligations issued or guaranteed by the U.S. Government or its agencies

<PAGE>

or instrumentalities, domestic bank certificates of deposit or bankers'
acceptances issued by United States branches of domestic banks (for the Money
Funds), and repurchase agreements secured by obligations of the U.S. Government
or its agencies or instrumentalities; (b) wholly owned finance companies will be
considered to be in the industries of their parents if their activities are
primarily related to financing the activities of their parents; (c) a Parent
Fund may invest more than 25% of its total assets in investment companies, or
portfolios thereof, that are Underlying Funds of the Parent Fund; and (d)
utilities will be divided according to their services. For example, gas, gas
transmission, electric and gas, electric, and telephone will each be considered
a separate industry;

2. Purchase securities of any one issuer, other than obligations issued
or guaranteed by the U.S. Government or its agencies or instrumentalities, if,
immediately after such purchase, more than 5% of the value of the Fund's total
assets would be invested in such issuer, or the Fund would hold more than 10% of
the outstanding voting securities of the issuer, except that 25% or less of the
value of a Fund's total assets may be invested without regard to such
limitations. There is no limit to the percentage of assets that may be invested
in U.S. Treasury bills, notes, or other obligations issued or guaranteed by the
U.S. Government or its agencies or instrumentalities. In addition, there is no
limit to the percentage of assets that a Parent Fund may invest in any
investment company;

3. Borrow money or issue senior securities, except that a Fund may borrow
from banks or brokers, in amounts up to 10% of the value of its total assets at
the time of such borrowing. A Fund will not purchase securities while its
borrowings exceed 5% of its total assets;

4. Make loans, except that a Fund may purchase or hold debt instruments
and lend portfolio securities in accordance with its investment objective and
policies, make time deposits with financial institutions and enter into
repurchase agreements;

5. Underwrite the securities issued by other persons, except to the
extent that a Fund may be deemed to be an underwriter under certain securities
laws in the disposition of "restricted securities;"

6. Purchase or sell commodities or commodities contracts, except to the
extent disclosed in the current Prospectus of the Fund; and

7. Purchase or sell real estate (although investments in marketable
securities of companies engaged in such activities and securities secured by
real estate or interests therein, or in Underlying Funds investing in such
securities, are not prohibited by this restriction).

For purposes only of investment limitation number 1 above, such limitation
shall not apply to Municipal Securities, and industrial development bonds or
private activity bonds that are backed only by the assets and revenues of a
nongovernmental user shall not be deemed to be Municipal Securities. For
purposes of investment limitation number 2 above, a security is considered to be

17
<PAGE>

issued by the governmental entity (or entities) whose assets and revenues back
the security and, with respect to a private activity bond that is backed only by
the assets and revenues of a nongovernmental user, a security is considered to
be issued by such nongovernmental user.

Irrespective of investment restriction number 2 above and pursuant to Rule
2a-7 under the 1940 Act, the Money Market Fund and the U.S. Treasury Fund will,
with respect to 100% of its total assets, limit its investment in the securities
of any one issuer in the manner provided by such Rule.

The following additional investment restrictions are not fundamental
policies and therefore may be changed without the vote of a majority of the
outstanding Shares of a Fund. None of the Funds may:

1. Engage in any short sales (except for short sales "against the box" by
the Large Companies Value, Large Companies Growth, Small Companies, Micro Cap,
Income Equity, International and Optimized Funds);

2. Invest more than 10% of the Fund's total assets in the securities of
issuers which, together with any predecessors, have a record of less than three
years of continuous operation, except that this limitation shall not apply to a
Parent Fund's investment in other investment companies, or portfolios thereof,
that are Underlying Funds of the Parent Fund;

3. Purchase securities of other investment companies, except (a) in
connection with a merger, consolidation, acquisition or reorganization, (b) to
the extent permitted by the 1940 Act or pursuant to any exemptions therefrom,
and (c) as consistent with the investment policies of a Parent Fund;

4. Purchase or retain securities of any issuer if the officers or
Trustees of the Trust and the officers or directors of its investment adviser
and of its administrator, who each owns beneficially more than one-half of 1% of
the outstanding securities of such issuer, together own beneficially more than
5% of such securities, except that this limitation shall not apply if the issuer
of the securities is an Underlying Fund of a Parent Fund;

5. Mortgage or hypothecate the Fund's assets in excess of one-third of
the Fund's total assets;

6. Purchase participations or direct interests in oil, gas or other
mineral exploration or development programs (although investments by the Fund in
marketable securities of companies engaged in such activities, or in securities
of Underlying Funds investing in such companies, are not prohibited by this
restriction);

7. Purchase securities on margin, except for use of short-term credit
necessary for clearance of purchases of portfolio securities and, for the Large
Companies Value, Large

18
<PAGE>

Companies Growth, Small Companies, Micro Cap, Income Equity, International,
Intermediate Bond, Bond and Tax-Free Bond Funds, except as may be necessary to
make margin payments in connection with foreign currency futures and other
derivative securities transactions; and

8. Purchase or otherwise acquire any securities if, as a result, more
than 15% (10% of the case of the Trust's Money Funds) of the Fund's net assets
would be invested in securities that are illiquid.

In addition, the Tax-Free Money Market Fund may not:

1. Acquire a put, if, immediately after such acquisition, over 5% of the
total amortized cost value of the Fund's assets would be subject to puts from
the same institution (except that (i) up to 25% of the value of the Fund's total
assets may be subject to puts without regard to such 5% limitation and (ii) the
5% limitation is inapplicable to puts that, by their terms, would be readily
exercisable in the event of a default in payment of principal or interest on the
underlying securities). For the purpose of this investment restriction and
investment restriction number 2 below, a put will be considered to be from the
party to whom the Fund will look for payment of the exercise price; and

2. Acquire a put that, by its terms, would be readily exercisable in the
event of a default in payment of principal and interest on the underlying
security or securities if, immediately after that acquisition, the amortized
cost value of the security or securities underlying that put, when aggregated
with the amortized cost value of any other securities issued or guaranteed by
the issuer of the put, would exceed 10% of the total amortized cost value of the
Fund's assets.

The Tax-Free Bond Fund may not:

1. Acquire a put, if, immediately after such acquisition, over 5% of the
total value of the Fund's assets would be subject to puts from the same
institution (except that (i) up to 25% of the value of the Fund's total assets
may be subject to puts without regard to such 5% limitation and (ii) the 5%
limitation is inapplicable to puts that, by their terms, would be readily
exercisable in the event of a default in payment of principal or interest on the
underlying securities). For the purpose of this investment restriction and
investment restriction number 2 below, a put will be considered to be from the
party to whom the Fund will look for payment of the exercise price; and

2. Acquire a put that, by its terms, would be readily exercisable in the
event of a default in payment of principal and interest on the underlying
security or securities if, immediately after that acquisition, the value of the
security or securities underlying that put, when aggregated with the value of
any other securities issued or guaranteed by the issuer of the put, would exceed
10% of the total value of the Fund's assets.

A Parent Fund may not:

<PAGE>

1. Redeem Shares of any Underlying Fund representing more than 3% of such
Underlying Fund's total assets during any one-month period, except as necessary
to meet redemption requests of the Parent Fund's Shareholders.

If any percentage restriction described above is satisfied at the time of
purchase, a later increase or decrease in such percentage resulting from a
change in net asset value will not constitute a violation of such restriction.
However, should a change in net asset value or other external events cause a
Fund's investments in illiquid securities to exceed the limitation set forth in
such Fund's Prospectus, that Fund will act to cause the aggregate amount of
illiquid securities to come within such limit as soon as reasonably practicable.
In such an event, however, that Fund would not be required to liquidate any
portfolio securities where the Fund would suffer a loss on the sale of such
securities.

In accordance with the terms of an order issued by the Securities and
Exchange Commission (Investment Company Act Release No. _____, dated _________,
1996), each Parent Fund may (i) own more than 3% of the total outstanding Shares
of an Underlying Fund, (ii) invest more than 5% of its assets in any one
Underlying Fund, and (iii) invest more than 10% of its assets in the Underlying
Funds as a group. Due to the investment policies of the Parent Funds, each
Parent Fund will concentrate more than 25% of its total assets in the investment
company industry. However, as described above, no Underlying Fund in which the
Parent Funds invest will concentrate more than 25% of its total assets in any
one industry.

Portfolio Turnover
- ------------------

Changes may be made in a Fund's portfolio consistent with the investment
objective and policies of the Fund whenever such changes are believed to be in
the best interests of the Fund and its Shareholders. The portfolio turnover
rates for all of the Funds may vary greatly from year to year as well as within
a particular year, and may be affected by cash requirements for redemptions of
Shares and by requirements which enable the Funds to receive certain favorable
tax treatments. High portfolio turnover rates will generally result in higher
transaction costs to a Fund, including brokerage commissions, and may result in
additional tax consequences to a Fund's Shareholders.

The portfolio turnover rate of each Parent Fund is expected to be low, as
such Fund will purchase or sell Shares of the Underlying Funds to (i)
accommodate purchases and sales of the Parent Fund's Shares, (ii) change the
percentage of its assets invested in each Underlying Fund in which it invests in
response to market conditions, and (iii) maintain or modify the allocation of
the Parent Fund's assets between Underlying Funds within the percentage limits
described in the Parent Fund's Prospectus. The portfolio turnover rate for each
of the Large Companies Growth and the Micro Cap Funds is not expected to exceed
100%. It is anticipated that the annual portfolio turnover rate for an
Underlying Fund normally will not exceed the amount stated in such Fund's
Prospectus, although the portfolio turnover rate for each of the Bond,
International, and Optimized Funds is expected to increase as each of these
Funds expands its

<PAGE>

investment activities following its recent commencement of operations.

The portfolio turnover rate for each of the Funds is calculated by dividing
the lesser of a Fund's purchases or sales of portfolio securities for the year
by the monthly average value of the securities. The Securities and Exchange
Commission requires that the calculation exclude all securities whose remaining
maturities at the time of acquisition are one year or less.

NET ASSET VALUE

As indicated in the Prospectuses, the net asset value of each Fund is
determined and the Shares of each Fund are priced as of the Valuation Time(s) on
each Business Day of the Trust. A "Business Day" is a day on which the New York
Stock Exchange ("NYSE") is open for trading, the Federal Reserve Bank of San
Francisco is open, and any other day except days on which there are insufficient
changes in the value of a Fund's portfolio securities to materially affect the
Fund's net asset value or days on which no Shares are tendered for redemption
and no order to purchase any Shares is received. Currently, the NYSE or the
Federal Reserve Bank of San Francisco is closed on the following holidays: New
Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving and
Christmas.

Valuation of the Trust's Money Funds
- ------------------------------------

The Money Funds have elected to use the amortized cost method of valuation
pursuant to Rule 2a-7 under the 1940 Act. This involves valuing an instrument
at its cost initially and thereafter assuming a constant amortization to
maturity of any discount or premium, regardless of the impact of fluctuating
interest rates on the market value of the instrument. This method may result in
periods during which value, as determined by amortized cost, is higher or lower
than the price one of these Funds would receive if it sold the instrument. The
value of securities in these Funds can be expected to vary inversely with
changes in prevailing interest rates.

Pursuant to Rule 2a-7, the Money Funds will maintain a dollar-weighted
average maturity appropriate for each Fund's objective of maintaining a stable
net asset value per Share, provided that no Money Fund will purchase any
security with a remaining maturity of more than 397 days (thirteen months)
(securities subject to repurchase agreements may bear longer maturities) nor
maintain a dollar-weighted average maturity which exceeds 90 days. The Board of
Trustees has also undertaken to establish procedures reasonably designed, taking
into account current market conditions and the investment objective of each of
these Funds, to stabilize the net asset value per Share of each Money Fund for
purposes of sales and redemptions at $1.00. These procedures include review by
the Trustees, at such intervals as they deem appropriate, to determine the
extent, if any, to which the net asset value per Share of each Fund calculated
by using available market quotations deviates from $1.00 per Share. In the
event such deviation exceeds one-half of one percent, Rule 2a-7 requires that
the Board of Trustees promptly consider what action, if any, should be
initiated. If the Trustees believe that the extent of any deviation from a
Money

<PAGE>

Fund's $1.00 amortized cost price per Share may result in material dilution or
other unfair results to new or existing investors, they will take such steps as
they consider appropriate to eliminate or reduce, to the extent reasonably
practicable, any such dilution or unfair results. These steps may include
selling portfolio instruments prior to maturity, shortening the dollar weighted
average maturity, withholding or reducing dividends, reducing the number of a
Money Fund's outstanding Shares without monetary consideration, or utilizing a
net asset value per Share determined by using available market quotations.

Valuation of the Other Funds
- ----------------------------

Portfolio securities, the principal market for which is a securities
exchange, will be valued at the closing sales price on that exchange on the day
of computation, or, if there have been no sales during such day, at the latest
bid quotation. Portfolio securities, the principal market for which is not a
securities exchange, will be valued at their latest bid quotation in such
principal market. Foreign securities are valued based on quotations from the
primary market in which they are traded and are translated from the local
currency into U.S. dollars using current exchange rates. If no such bid price
is available, then securities will be valued in good faith at their respective
fair market values using methods determined by or under the supervision of the
Board of Trustees. Portfolio securities with a remaining maturity of 60 days or
less will be valued either at amortized cost or original cost plus accrued
interest, which approximates current value.

All other assets and securities, including securities for which market
quotations are not readily available, will be valued at their fair market value
as determined in good faith under the general supervision of the Board of
Trustees.

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

Each of the classes of Shares of the Funds is sold on a continuous basis by
the Distributor, and the Distributor has agreed to use appropriate efforts to
solicit all purchase orders. In addition to purchasing Shares directly from the
Distributor, Shares may be purchased through a broker-dealer who has established
a dealer agreement with the Distributor and certain other industry professionals
(collectively, "Entities") acting on behalf of customers for investment of funds
that are held by in a fiduciary, agency, custodial or similar capacity. Shares
of a Fund also may be purchased by other Funds of the Trust or by other
investment portfolios established by the Trust.

As stated in the relevant Prospectuses, the public offering price of Class
A Shares of the Money Funds is their net asset value per Share, which they will
seek to maintain at $1.00. The public offering price of Class A Shares of each
of the other Funds is their net asset value per Share next computed after the
sale plus a sales charge which varies based upon the quantity purchased. The
public offering price of such Class A Shares of the Trust is calculated by
dividing net asset value by the difference (expressed as a decimal) between 100%
and the sales charge percentage of offering price applicable to the purchase.
The offering price is rounded to two

<PAGE>

decimal places each time a computation is made. The sales charge scale set
forth in a Fund's Prospectus applies to purchases of Class A Shares of such a
Fund by an investor.

The public offering price of Class C Shares of each Parent, Equity and
Income Fund is their net asset value per Share, although Class C Shares redeemed
within one year of their purchase may be subject to a contingent deferred sales
charge of 1.00%. Purchasers of Class C Shares will have more of their initial
purchase price invested. Any positive investment return on this additional
invested amount would partially or wholly offset the expected higher annual
expenses borne by Class C Shares. Because the Trust's future returns cannot be
predicted, there can be no assurance that this will be the case. Investors in
Class C Shares would, however, own Shares that are subject to higher annual
expenses and, for Shares owned for less than one year, such Shares would be
subject to a contingent deferred sales charge of 1.00% upon redemption.

The public offering price of Class Q Shares of each Money Fund is their net
asset value per Share, which each Money Fund seeks to maintain at $1.00.

Class Y Shares may also be purchased through procedures established by the
Distributor in connection with the requirements of qualified accounts maintained
by or on behalf of certain persons ("Customers") by United States National Bank
of Oregon ("U.S. Bank"), one of its affiliates, or other financial institutions.
With respect to Class Y Shares so sold, it is the responsibility of the holder
of record to transmit purchase or redemption orders to the Distributor and to
deliver funds for the purchase thereof on a timely basis. Beneficial ownership
of such Class Y Shares of the Funds will be recorded and reflected in the
account statements provided to Customers. U.S. Bank or its affiliates may
exercise voting authority for those Class Y Shares for which it has been granted
authority by the Customer. Confirmation of purchases and redemptions of Class Y
Shares of the Funds by U.S. Bank or its affiliates on behalf of a Customer may
be obtained from U.S. Bank or the affiliate.

Depending upon the terms of a particular Customer account, Customers may be
charged account fees for services provided in connection with investment in a
Fund. Customers are urged to request information concerning these services and
charges.

Matters Affecting Redemption
- ----------------------------

The Trust may suspend the right of redemption or postpone the date of
payment for Shares during any period when (a) trading on the NYSE is restricted
by applicable rules and regulations of the Securities and Exchange Commission,
(b) the NYSE is closed for other than customary weekend and holiday closings,
(c) the Securities and Exchange Commission has by order permitted such
suspension, or (d) an emergency exists as a result of which (i) disposal by the
Trust of securities owned by it is not reasonably practical or (ii) it is not
reasonably practical for the Trust to determine the fair market value of its net
assets.

<PAGE>

The Money Funds may redeem Shares involuntarily if redemption appears
appropriate in light of the Trust's responsibilities under the 1940 Act. See
"NET ASSET VALUE - Valuation of the Money Funds" in this SAI.

MANAGEMENT OF THE TRUST

Trustees and Officers
- ---------------------

Overall responsibility for management of the Trust rests with its Trustees,
who are elected by the Shareholders of the Trust. The Trustees elect the
officers of the Trust to supervise actively its day-to-day operations. George
R. Landreth, Stephen G. Mintos, Mark A. Dillon, J. David Huber, Mary Anne
Houlahan, Walter B. Grimm, Irimga McKay, Gregory T. Maddox and Robert L. Tuch
are the officers of the Trust. Mr. Landreth and Ms. Houlahan also serve as
Trustees.

The names of the Trustees, their addresses and principal occupations during
the past five years are set forth below:

Principal Occupation
Name and Address During Past 5 Years
---------------- -------------------

George R. Landreth* Director of Client Services;
3435 Stelzer Road BISYS Fund Services (12/92-
Columbus, OH 43219-3035 present); Vice President, PNC
Age: 53 Financial (7/91-12/92); Senior
Vice President, The Central
Trust Company (10/84-7/91).

David F. Jones Principal, The Harvey-Jones
P.O. Box 23969 Company (real estate
Federal Way, WA 98023 management)(7/93-present);
Age: 55 Chief Executive Officer,
Pacific Nuclear Systems, Inc.
(nuclear engineering)(5/83-
9/92).

Raymond H. Lung* Retired (1/91-present).
16199 N.W. Canterwood Way
Portland, OR 97229
Age: 68

John W. Judy President, American
P. O. Box 4166 International Forest Products,
Portland, OR 97208 Inc. (7/89-present).
Age: 57

Mary Anne Houlahan* Senior Vice President and
Director of

<PAGE>

515 South Figueroa Street Distribution Services, BISYS
Suite 335 Fund Services (1/93-present);
Los Angeles, CA 90071 Senior Vice President-
Age: 41 Marketing, Great Western
Investment Management (6/85-
12/92).

David B. Frohnmayer President, University of
Johnson Hall Oregon (7/94-present); Dean,
University of Oregon University of Oregon Law
Eugene, OR 97403 Center (1/92-7/94); Attorney
Age: 55 General, State of Oregon
(1/81-12/91).

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

* Mr. Landreth, Mr. Lung and Ms. Houlahan are "interested persons" of the
Trust as that term is defined in the 1940 Act.

Remuneration of Trustees
- ------------------------

The Trust pays each Trustee an annual fee of $15,000, plus $1,000 for each
meeting of the Board of Trustees attended and reasonable out-of-pocket expenses.
For the fiscal year ended July 31, 1995, the Trust paid the following
compensation to all Trustees of the Trust:

<TABLE><CAPTION>
Pension or Retirement Estimated Annual
Aggregate Benefits Accrued as Benefits Upon Total
Compensation Fund Expenses Retirement Compensation
------------ -------------------- ---------------- ------------
<S> <C> <C> <C> <C>
George R. Landreth $ 0 $ 0 $ 0 $ 0

David F. Jones $18,000 $ 0 $ 0 $18,000

John W. Judy $18,000 $ 0 $ 0 $18,000

Raymond H. Lung $18,000 $ 0 $ 0 $18,000

Mary Anne Houlahan $ 0 $ 0 $ 0 $ 0

David B. Frohnmayer $14,250 $ 0 $ 0 $14,250
</TABLE>

The officers of the Trust, their addresses, and principal occupations
during the past five years are as follows:

<TABLE><CAPTION>
Position(s) Held Principal Occupation
Name and Address With the Trust During Past 5 Years
- ---------------- ---------------- --------------------
<S> <C> <C>
George R. Landreth President, Chief Director of Client Services,
3435 Stelzer Road Executive Officer, BISYS Fund Services
Columbus, OH 43219-3035 and Trustee (12/92-present); Vice
</TABLE>

<PAGE>

Position(s) Held Principal Occupation
Name and Address With the Trust During Past 5 Years
- ---------------- ---------------- --------------------

Age: 53 President, PNC Financial
(7/91-12/92); Senior Vice
President, The Central
Trust Co. (10/84-7/91).

Stephen G. Mintos Vice President Executive Vice President,
3435 Stelzer Road BISYS Fund Services
Columbus, OH 43219-3035 (1/87-present).
Age: 41

Mark A. Dillon Vice President Employee of BISYS Fund
3435 Stelzer Road Services (12/86-present).
Columbus, OH 43219-3035
Age: 33

J. David Huber Vice President Employee of BISYS Fund
3435 Stelzer Road Services (6/87-present).
Columbus, OH 43219-3035
Age: 49

Mary Anne Houlahan Vice President and Senior Vice President and
515 South Figueroa Street Trustee Director of Distribution
Suite 335 Services, BISYS Fund
Los Angeles, CA 90071 Services (1/93-present);
Age: 41 Senior Vice President-
Marketing, Great Western
Investment Management
(6/85-12/92).

Walter B. Grimm Vice President Employee of BISYS Fund
3435 Stelzer Road Services (6/92-present);
Columbus, OH 43219-3035 President, Leigh
Age: 50 Investments (investment
firm) (7/87-6/92).

Irimga McKay Vice President First Vice President,
Columbia Square, Suite 500 BISYS Fund Services
1230 Columbia Street (11/88 to present).
San Diego, CA 92101
Age: 35

<PAGE>

Position(s) Held Principal Occupation
Name and Address With the Trust During Past 5 Years
- ---------------- ---------------- --------------------

Gregory T. Maddox Treasurer, Principal Employee of BISYS Fund
Columbia Squire, Suite 500 Financial and Account- Services (4/91-present).
1230 Columbia Street ing Officer, and Secretary
San Diego, CA 92101
Age: 27

Robert L. Tuch Assistant Secretary Employee of BISYS Fund
3435 Stelzer Road Services (6/91-present);
Columbus, OH 43219-3035 Vice President and
Age: 44 Associate General
Counsel, National
Securities and Research
Corp. (7/90-6/91).

The officers of the Trust receive no compensation directly from the Trust
for performing the duties of their offices. BISYS receives fees from the Trust
for acting as Administrator and for providing certain fund accounting services,
may retain all or a portion of any sales charge on the Shares and may receive
fees under the Distribution and Shareholder Service Plans described below.
BISYS Fund Services Ohio, Inc. receives fees from the Trust for acting as
transfer agent.

Investment Adviser
- ------------------

Subject to the general supervision of the Trust's Board of Trustees and in
accordance with the Funds' investment objectives, policies and restrictions,
investment advisory services are provided to the Funds by Qualivest Capital
Management, Inc., 111 S.W. Fifth Avenue, Portland, Oregon 97204, pursuant to an
Investment Advisory Agreement dated July 29, 1994 and supplemented effective May
1, 1995 and __________, 1996.

Qualivest is a wholly owned subsidiary of U.S. Bank, which in turn is a
wholly owned subsidiary of U.S. Bancorp, a publicly held bank holding company.

John H. Coulter, a Short-Term Investments Manager at Qualivest, has primary
responsibility for management of the Money Market and U.S. Treasury Funds. Mr.
Coulter has twenty-nine years of investment management experience and has been
employed by Qualivest since 1965. He has received a Bachelor of Science degree
in Business Administration from Oregon State University.

Under the Investment Advisory Agreement, Qualivest has agreed to provide,
either directly or through one or more subadvisers, investment advisory services
for each of the Funds as described in their respective Prospectuses. For the
services provided and expenses assumed pursuant to the Investment Advisory
Agreement, each of the Funds

<PAGE>

pays Qualivest a fee, computed daily and paid monthly, at an annual rate as
disclosed in each Prospectus calculated as a percentage of the average daily net
assets of that Fund. Each Parent Fund, as a Shareholder in an Underlying Fund,
also indirectly bears its proportionate share of any investment advisory fees
paid by the Underlying Fund. For the fiscal period ended July 31, 1995, the
Equity, Income and Money Funds paid Qualivest the following in advisory
fees: Large Companies Value Fund - $185,314, Small Companies
Fund - $499,916, International Fund - $17,933, Optimized Fund - $104,513,
Intermediate Bond Fund - $244,351, Bond Fund - $72,657, U.S. Treasury
Fund - $0, Money Market Fund - $262,916 and Tax-Free Money Market Fund - $0.

Unless sooner terminated, the Investment Advisory Agreement continues in
effect as to a particular Fund until July 29, 1996, and thereafter for
successive one-year periods ending July 29 of each year if such continuance is
approved at least annually by the Board of Trustees or by vote of a majority of
the outstanding Shares of such Fund and a majority of the Trustees who are not
parties to the Investment Advisory Agreement or interested persons (as defined
in the 1940 Act) of any party to the Investment Advisory Agreement by votes cast
in person at a meeting called for such purpose. The Investment Advisory
Agreement is terminable as to a particular Fund at any time on 60 days' written
notice without penalty by the Trustees, by vote of a majority of the outstanding
Shares of that Fund, or by Qualivest. Such Agreement also terminates
automatically in the event of any assignment, as defined in the 1940 Act.

The Investment Advisory Agreement provides that Qualivest shall not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Trust in connection with the performance of its duties, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith, or gross negligence on the part of Qualivest or any sub-investment
advisers in the performance of their duties, or from reckless disregard of their
duties and obligations thereunder.

From time to time, advertisements, supplemental sales literature, and
information furnished to present or prospective Shareholders of the Funds may
include descriptions of Qualivest including, but not limited to, (i)
descriptions of Qualivest's operations; (ii) descriptions of certain personnel
and their functions; and (iii) statistics and rankings related to Qualivest's
operations.

Portfolio Transactions
- ----------------------

With respect to all Funds of the Trust, Qualivest determines, subject to
the general supervision of the Board of Trustees and in accordance with each
Fund's investment objective, policies and restrictions, which securities are to
be purchased and sold by a Fund, and which brokers are to be eligible to execute
an Equity, Income or Money Fund's portfolio transactions.

Purchases and sales of portfolio securities which are debt securities
usually are principal transactions in which portfolio securities are normally
purchased directly from the issuer or from

<PAGE>

an underwriter or market maker for the securities. Purchases from underwriters
of portfolio securities generally include a commission or concession paid by the
issuer to the underwriter, and purchases from dealers serving as market makers
may include the spread between the bid and asked price. Transactions on stock
exchanges involve the payment of negotiated brokerage commissions. Transactions
in the over-the-counter market are generally principal transactions with
dealers. With respect to the over-the-counter market, the Trust, where
possible, will deal directly with dealers who make a market in the securities
involved except in those circumstances where better price and execution are
available elsewhere.

Allocation of transactions, including their frequency, to various brokers
and dealers is determined by Qualivest in its best judgment and in a manner
deemed fair and reasonable to Shareholders. In selecting a broker, Qualivest
evaluates a wide range of criteria, including the broker's commission rate and
execution capability, the broker's positioning and distribution capabilities,
back office efficiency, ability to handle difficult trades, financial stability,
reputation, prior performance, sale of Fund Shares, and research. The primary
consideration is the broker's ability to provide prompt execution of orders in
an effective manner at the most favorable price for the security. Subject to
this consideration, brokers and dealers who provide supplemental investment
research to Qualivest may receive orders for transactions on behalf of the
Trust. Research may include brokers' analyses of specific securities,
performance and technical statistics, and information databases. It may also
include maintenance research, which is the information that keeps Qualivest
informed concerning overall economic, market, political and legal trends. Under
some circumstances, Qualivest's evaluation of research and other broker
selection criteria may result in one or a few brokers executing a substantial
percentage of an Equity, Income or Money Fund's trades. This might occur, for
example, where a broker can provide best execution at a cost that is reasonable
in relation to its services and the broker offers unique or superior research
facilities, special knowledge or expertise in a Fund's relevant markets, or
access to proprietary information about companies, like those included in the
EAFE Index, that are a majority of a Fund's investments.

Research information so received is in addition to and not in lieu of
services required to be performed by Qualivest and does not reduce the fees
payable to Qualivest by the Trust. Such information may be useful to Qualivest
in serving both the Trust and other clients and, conversely, supplemental
information obtained by the placement of business of other clients may be useful
in carrying out its obligations to the Trust. While Qualivest generally seeks
competitive commissions, the Trust may not necessarily pay the lowest commission
available on each brokerage transaction for reasons discussed above.

Some of Qualivest's other clients have investment objectives similar to
those of the Funds. Qualivest may recommend or purchase and sell the same
securities on behalf of both the Funds and its other clients. When a purchase
or sale of the same security is made at substantially the same time on behalf of
an Equity, Income or Money Fund and another Fund, portfolio, investment company
or account, the transaction will be averaged as to price and available
investments will be allocated as to amount in a manner which Qualivest believes
to be equitable to the Fund(s) and

<PAGE>

such other portfolio, investment company or account. In some instances, this
investment procedure may adversely affect the price paid or received by a Fund
or the size of the position obtained by a Fund. To the extent permitted by law,
Qualivest may aggregate the securities to be sold or purchased for an Equity,
Income or Money Fund with those to be sold or purchased for the other Funds or
for other portfolio, investment companies or accounts in order to obtain best
execution. As provided by the Investment Advisory Agreement, in making
investment recommendations for the Trust, Qualivest will not inquire or take
into consideration whether an issuer of securities proposed for purchase or sale
by the Trust is a customer of Qualivest, its parent or its subsidiaries or
affiliates and, in dealing with its customers, Qualivest, its parent,
subsidiaries, and affiliates will not inquire or take into consideration whether
securities of such customers are held by the Trust.

For the fiscal period ended July 31, 1995, the Equity Funds paid the
following in brokerage commissions: Large Companies Value Fund - $139,373,
Small Companies Fund - $251,933, International Fund - $182,317 and Optimized
Fund - $74,929. Of this amount, none was paid to any brokers that are
affiliated with the Trust. In addition, for the fiscal period ended July 31,
1995, the following Funds paid the indicated amounts to brokers from which
Qualivest received research services: Large Companies Value Fund - $43,422.72,
and Small Companies Fund - $122,469.00.

Glass-Steagall Act
- ------------------

In 1971, the United States Supreme Court held that the federal statute
commonly referred to as the "Glass-Steagall Act" prohibits a national bank from
operating a mutual fund for the collective investment of managing agency
accounts. Subsequently, the Board of Governors of the Federal Reserve System
(the "Board") issued a regulation and interpretation to the effect that the
Glass-Steagall Act and such decision: (a) forbid a bank holding company
registered under the Federal Bank Holding Company Act of 1956 (the "Holding
Company Act") or any non-bank affiliate thereof from sponsoring, organizing, or
controlling a registered, open-end investment company continuously engaged in
the issuance of its shares, but (b) do not prohibit such a holding company or
affiliate from acting as investment adviser, transfer agent, and custodian to
such an investment company. In 1981, the United States Supreme Court determined
that the Board did not exceed its authority under the Holding Company Act when
it adopted its regulation and interpretation authorizing bank holding companies
and their nonbank affiliates to act as investment advisers to registered
closed-end investment companies. The Supreme Court also stated that if a
national bank complied with the restrictions imposed by the Board in its
regulation and interpretation authorizing bank holding companies and their non--
bank affiliates to act as investment advisers to investment companies, a
national bank performing investment advisory services for an investment company
would not violate the Glass-Steagall Act.

Qualivest believes that it possesses the legal authority to perform the
services for the Funds contemplated by the Prospectuses, this SAI and the
Investment Advisory Agreement without violation of applicable statutes and
regulations. Counsel has pointed out, however, that there is

<PAGE>

presently no controlling authority regarding the performance of the combination
of investment advisory and shareholder servicing activities by national banks
and their subsidiaries. Moreover, such counsel has advised that changes in
federal banking laws and regulations related to the permissible activities of
national banks, subsidiaries of national banks, and national banks and their
subsidiaries that are affiliates of a bank holding company, as well as further
judicial or administrative decisions on interpretations of present and future
statutes and regulations, could prevent Qualivest from continuing to serve as
investment adviser to the Funds or could restrict the services which Qualivest
is permitted to perform for the Funds. In addition, such changes, decisions or
interpretations could prevent Qualivest's national bank affiliates from
performing shareholder servicing activities or from receiving compensation
therefor or could restrict the types of services such entities are permitted to
provide and the amount of compensation they are permitted to receive for such
services. Depending upon the nature of any changes in the services which could
be provided by Qualivest, the Board of Trustees would review the Trust's
relationship with Qualivest and consider taking all action necessary in the
circumstances.

Should future legislative, judicial, or administrative action prohibit or
restrict the proposed activities of Qualivest and/or U.S. Bank's affiliated
banks in connection with Customer purchases of Shares of the Trust, those banks
might be required to alter materially or discontinue the services offered by
them to Customers. It is not anticipated, however, that any change in the
Trust's method of operations would affect its daily net asset value per Share or
result in financial losses to any Customer.

Administrator
- -------------

BISYS serves as general manager and administrator to the Trust pursuant to
the Management and Administration Agreement dated July 29, 1994 and supplemented
effective May 1, 1995 and __________, 1996 (the "Administration Agreement").
The Administrator assists in supervising all operations of each Fund (other than
those performed by Qualivest under the Investment Advisory Agreement, by U.S.
Bank and The Bank of New York under the Custody Agreements and by BISYS Fund
Services Ohio, Inc. under the Transfer Agency Agreement). The Administrator is
a broker-dealer registered with the Securities and Exchange Commission, and is a
member of the National Association of Securities Dealers, Inc. The
Administrator provides financial services to institutional clients.

Under the Administration Agreement, the Administrator has agreed to
maintain office facilities for the Trust; furnish statistical and research data,
clerical and certain bookkeeping services and stationery and office supplies;
prepare the periodic reports to the Securities and Exchange Commission on Form
N-SAR or any replacement forms therefor; compile data for, prepare for execution
by the Funds and file certain federal and state tax returns and required tax
filings; prepare compliance filings pursuant to state securities laws with the
advice of the Trust's counsel; keep and maintain the financial accounts and
records of the Funds, including calculation of daily expense accruals; in the
case of the Money Funds, determine the actual variance from $1.00 of a Money
Fund's net asset value per Share; and generally assist in all aspects of the

<PAGE>

Trust's operations other than those performed by Qualivest under the Investment
Advisory Agreement, by U.S. Bank and The Bank of New York under the Custody
Agreements and by BISYS Fund Services Ohio, Inc. under the Transfer Agency
Agreement. Under the Administration Agreement, the Administrator may delegate
all or any part of its responsibilities thereunder.

The Administrator receives a fee from each Fund for its services as
Administrator and expenses assumed pursuant to the Administration Agreement,
calculated daily and paid periodically. This fee is equal to 0.13% of each
Equity, Income and Money Fund's average daily net assets, and ____% of each
Parent Fund's average daily net assets, or such other fee as may from time to
time be agreed upon by the Trust and the Administrator. The Administrator may
voluntarily reduce all or a portion of its fee with respect to any Fund in order
to increase the net income of one or more of the Funds available for
distribution as dividends.

Unless sooner terminated as provided therein, the Administration Agreement
will continue in effect until July 29, 1996. The Administration Agreement
thereafter shall be renewed automatically for successive two-year terms, unless
written notice not to renew is given by the non-renewing party to the other
party at least 60 days prior to the expiration of the then-current term. The
Administration Agreement is terminable with respect to a particular Fund only
upon mutual agreement of the parties to the Administration Agreement and for
cause (as defined in the Administration Agreement) by the party alleging cause,
on no less than 60 days' written notice by the Board of Trustees or by the
Administrator.

The Administration Agreement provides that the Administrator shall not be
liable for any error of judgment or mistake of law or any loss suffered by the
Trust in connection with the matters to which the Administration Agreement
relates, except a loss resulting from willful misfeasance, bad faith, or gross
negligence in the performance of its duties, or from the reckless disregard by
the Administrator of its obligations and duties thereunder.

Expenses
- --------

If total expenses borne by any of the Funds in any fiscal year exceed
expense limitations imposed by applicable state securities regulations,
Qualivest and the Administrator will reimburse that Fund by the amount of such
excess in proportion to their respective fees. As of the date of this SAI, the
most restrictive expense limitation applicable to the Funds limits each Fund's
aggregate annual expenses, including management and advisory fees but excluding
interest, taxes, brokerage commissions, and certain other expenses, to 2 1/2% of
the first $30 million of a Fund's average net assets, 2% of the next $70 million
of a Fund's average net assets, and 1 1/2% of a Fund's remaining average net
assets. Any expense reimbursements will be estimated daily and reconciled and
paid on a monthly basis. Fees imposed upon customer accounts by U.S. Bank or
its affiliated banks for cash management services are not included within Trust
expenses for purposes of any such expense limitation.

32
<PAGE>

Distributor
- -----------

BISYS serves as distributor to the Trust pursuant to the Distribution
Agreement dated July 29, 1995 (the "Distribution Agreement"). Unless otherwise
terminated, the Distribution Agreement will remain in effect until July 29,
1996, and thereafter continues for successive one-year periods ending July 29 of
each year if approved at least annually (i) by the Board of Trustees or by the
vote of a majority of the outstanding Shares of the Trust, and (ii) by the vote
of a majority of the Trustees who are not parties to the Distribution Agreement
or interested persons (as defined in the 1940 Act) of any party to the
Distribution Agreement, cast in person at a meeting called for the purpose of
voting on such approval. The Distribution Agreement may be terminated in the
event of any assignment, as defined in the 1940 Act.

As described in the respective Funds' Prospectuses, the Trust has adopted
Distribution and Shareholder Service Plans with respect to Class A Shares of all
Funds (the "Class A Plans"), Distribution and Shareholder Service Plans with
respect to Class C Shares of the Parent Funds, the Equity Funds and the Income
Funds (the "Class C Plans") and Distribution and Shareholder Service Plans with
respect to Class Q Shares of the Money Funds (the "Class Q Plans") (the Class A
Plans, Class C Plans and Class Q Plans together are hereinafter referred to as
the "Plans") pursuant to Rule 12b-1 under the 1940 Act under which the Funds are
authorized to pay BISYS for payments it makes to banks, including U.S. Bank,
other institutions and broker-dealers, and for expenses BISYS and any of its
affiliates or subsidiaries incur (with all of the foregoing organizations being
referred to as "Participating Organizations") for providing administration,
distribution or shareholder service assistance. Payments to such Participating
Organizations may be made pursuant to agreements entered into with BISYS or with
the Trust. The Class A Plans authorize a Fund to make payments to BISYS in an
amount not in excess, on an annual basis, of 0.25% (0.40% for the Money Funds)
of the average daily net asset value of the Class A Shares of that Fund. As
required by Rule 12b-1, the Class A Plans were approved by the holders of the
Class A Shares and by the Board of Trustees, including a majority of the
Trustees who are not interested persons of the Funds and who have no direct or
indirect financial interest in the operation of those Plans (the "Independent
Trustees"). The Class C Plans authorize a Fund to make payments to BISYS in an
amount not in excess, on an annual basis, of 1.00% of the average daily net
asset value of the Class C Shares of that Fund. Over time, the expense of the
annual Rule 12b-1 fee on the Class C Shares may equal or exceed the initial
sales charge and annual Rule 12b-1 fee applicable to Class A Shares. For
example, if net asset value remains constant, the aggregate Rule 12b-1 fees with
respect to Class C Shares of the Large Companies Value, Large Companies Growth,
Small Companies, Micro Cap, Income Equity, International and Optimized Stock
Funds would equal or exceed the initial sales charge and aggregate Rule 12b-1
fees of Class A Shares approximately six years after purchase, Rule 12b-1 fees
with respect to Class C Shares of the Intermediate Bond, Bond and Tax-Free Bond
Funds would equal or exceed the initial sales charge and aggregate Rule 12b-1
fees of Class A Shares approximately four and two-third years after purchase,
and Rule 12b-1 fees with respect to Class C Shares of the Parent Funds would
equal or exceed the initial sales charge and aggregate Rule 12b-1 fees of Class
A Shares approximately _____ years after purchase. This example assumes that
the initial purchase of

<PAGE>

Class A Shares would be subject to the maximum initial sales charge. As
required by Rule 12b-1, the Class C Plans have been approved by the Board of
Trustees, including a majority of the Independent Trustees, and the Class C
Shareholders of each Fund. The Class Q Plans authorize a Money Fund to make
payments to BISYS in an amount not in excess, on an annual basis, of 0.25% of
the average daily net asset value of the Class Q Shares of each Money Fund. As
required by Rule 12b-1, the Class Q Plans have been approved by the Board of
Trustees, including a majority of the Independent Trustees, and the Class Q
Shareholders of each Money Fund.

The Shareholder and distribution services provided by Participating
Organizations may include promoting the purchase of Shares of a Fund by their
customers; processing purchase, exchange, and redemption requests from customers
and placing orders with the Distributor or the Transfer Agent; processing
dividend and distribution payments from a Fund on behalf of customers; providing
information periodically to customers, including information showing their
positions in Shares; providing sub-accounting with respect to Shares
beneficially owned by customers or the information necessary for sub-accounting;
responding to inquiries from customers concerning their investment in Shares;
arranging for bank wires; and providing other similar services as may be
reasonably requested. A portion of this distribution fee, up to 0.25% of the
average daily net assets of each class of Shares, may be paid to the Distributor
and Participating Organizations as a "service fee," as defined in the rules of
the National Association of Securities Dealers, Inc. for personal service and
maintenance of Shareholder accounts.

The Trust understands that Participating Organizations may charge fees to
their customers who are the owners of Class A Shares for additional services
provided in connection with their customer accounts. These fees would be in
addition to any amounts which may be received by a Participating Organization
under its Rule 12b-1 Agreement with BISYS. Customers of Participating
Organizations should read the Prospectus and SAI in light of the terms governing
their accounts with their Participating Organizations.

Conflict of interest restrictions may apply to the receipt by
Participating Organizations of compensation from the Trust in connection with
the investment of fiduciary assets in Shares. Institutions, including banks
regulated by the Comptroller of the Currency, the Federal Reserve Board, or the
Federal Deposit Insurance Corporation, and investment advisers and other money
managers subject to the jurisdiction of the Securities and Exchange Commission,
the Department of Labor, or state securities commissions, are urged to consult
their legal advisers before investing such assets in Shares of the Funds.

The Plans require the officers of the Trust to provide the Board of
Trustees at least quarterly with a written report of the amounts expended
pursuant to the Plans and the purposes for which such expenditures were made.
The Board reviews these reports in connection with its decisions with respect to
the Plans. The Plans continue in effect as long as such continuance is
specifically approved at least annually by the Trustees, including a majority of
the Independent Trustees.

<PAGE>

The Plans may be terminated as to a Fund by vote of a majority of the
Independent Trustees, or by vote of majority of the outstanding Shares of the
particular class of the Fund. Any change in a Plan that would materially
increase the distribution cost to the Fund requires Shareholder approval. The
Trustees review quarterly a written report of such costs and the purposes for
which such costs have been incurred. The Plan may be amended by vote of the
Trustees, including a majority of the Independent Trustees, cast in person at a
meeting called for that purpose. For so long as the Plans are in effect,
selection and nomination of those Trustees who are not interested persons of the
Trust shall be committed to the discretion of such Independent Trustees. All
agreements with any person relating to the implementation of a Plan may be
terminated at any time on 60 days' written notice without payment of any
penalty, by vote of a majority of the Independent Trustees or by a vote of the
majority of the outstanding Shares of the particular class of the Fund. The
Plans will continue in effect for successive one-year periods, provided that
each such continuance is specifically approved (i) by the vote of a majority of
the Independent Trustees, and (ii) by a vote of a majority of the entire Board
of Trustees cast in person at a meeting called for that purpose. The Board of
Trustees has a duty to request and evaluate such information as may be
reasonably necessary for them to make an informed determination of whether the
Plans should be implemented or continued. In addition the Trustees in approving
the Plans must determine that there is a reasonable likelihood that the Plans
will benefit the Funds and their Shareholders.

The Board of Trustees believes that the Plans are in the best interests of
the Funds since they encourage Fund growth. As the Funds grow in size, certain
expenses, and therefore total expenses per Share, may be reduced and overall
performance per Share may be improved.

As authorized by each Plan, BISYS has entered into agreements with U.S.
Bancorp Securities, Inc. ("USBS") pursuant to which USBS has agreed to provide
certain administrative and Shareholder support services in connection with
Shares purchased and held by USBS for the accounts of its customers and Shares
purchased and held by customers of USBS directly, including, but not limited to,
advertising and marketing the Shares, answering routine questions concerning the
Funds and distributing prospectuses to persons other than Shareholders of the
Funds, and providing such office space, equipment, telephone and personnel as is
necessary and appropriate to accomplish such matters. In consideration of such
services BISYS has agreed to pay USBS a monthly fee, computed at the annual rate
of up to 0.25% (up to 0.40% for the Money Funds) of the average aggregate net
asset value of Class A Shares, up to 0.75% of the average aggregate net asset
value of Class C Shares, and up to 0.25% of the average aggregate net asset
value of Class Q Shares held during the period in customer accounts for which
USBS has provided services under an agreement. In addition, BISYS has agreed to
pay USBS a monthly fee, computed at the annual rate of up to 0.25% of the
average aggregate net asset value of Class C Shares held during the period in
accounts for which USBS has arranged for the provision of Shareholder services.
BISYS will be compensated by each Fund in an amount equal to its payments to
USBS under each agreement with respect to the Shares of each class of that Fund.

35
<PAGE>

For the fiscal period ended July 31, 1995, the Funds paid BISYS the
following fees pursuant to the Class A Plan: Large Companies Value Fund - $877,
Small Companies Fund - $1,111, International Fund - $2, Optimized Fund - $8,
Intermediate Bond Fund - $426, Bond Fund - $0, U.S. Treasury Fund - $145,467,
Money Market Fund - $586,906 and Tax-Free Money Market Fund - $80,020. For the
fiscal period ended July 31, 1995, the Funds paid BISYS the following fees
pursuant to the Class C Plan: Large Companies Value Fund - $1,110, Small
Companies Fund - $1,120, International Fund - $0, Optimized Fund - $36,
Intermediate Bond Fund - $697 and Bond Fund - $0. For the fiscal period ended
July 31, 1995, the Funds paid BISYS the following fees pursuant to the Class Q
Plan: U.S. Treasury Fund - $5,559, Money Market Fund - $12,130 and Tax-Free
Money Market Fund - $1,240. All expenditures were for compensation of BISYS for
its expenses incurred and its services provided as underwriter of the Shares of
the Funds. In addition, for the fiscal period ended July 31, 1995, BISYS
received $73,923 in aggregate commissions from the sale of Class A Shares, of
which BISYS retained $7,841 after dealer reallowances.

Custodians, Transfer Agent and Fund Accounting Services
- -------------------------------------------------------

United States National Bank of Oregon, 321 S.W. 6th, Portland, Oregon
97204, serves as custodian to the Trust with respect to all Funds other than the
International Fund pursuant to a Custody Agreement dated as of July 29, 1994 and
supplemented effective May 1, 1995 and ________, 1996. The Bank of New York,
One Wall Street, New York, New York 10286 serves as custodian to the Trust with
respect to the International Fund pursuant to a Custody Agreement dated as of
October 12, 1995. U.S. Bank and The Bank of New York perform custodial services
including safeguarding and controlling the Funds' cash and securities, handling
the receipt and delivery of securities, and collecting interest and dividends on
such Funds' investments.

BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus, Ohio 43219-
3035, serves as transfer agent and dividend disbursing agent (the "Transfer
Agent") for all Funds of the Trust pursuant to a Transfer Agency Agreement dated
as of July 29, 1994 and supplemented effective May 1, 1995 and _______, 1996.
Pursuant to such Transfer Agency Agreement, the Transfer Agent, among other
things, performs the following services: maintenance of Shareholder records for
each of the Trust's Shareholders of record; processing Shareholder purchase and
redemption orders; processing transfers and exchanges of Shares of the Trust on
the Shareholder files and records; processing dividend payments and
reinvestments; and assistance in the mailing of Shareholder reports and proxy
solicitation materials. For such services, the Transfer Agent receives a fee
based on the number of Shareholders of record.

In addition, BISYS Fund Services Ohio, Inc. provides certain fund
accounting services to the Trust pursuant to a Fund Accounting Agreement dated
July 29, 1994 and supplemented effective May 1, 1995 and ________, 1996. BISYS
Fund Services Ohio, Inc. receives a fee for such services, computed daily and
paid periodically at an annual rate of 0.04% of the average daily net assets of
each Exempt Fund, and 0.03% of the average daily net assets of each of the other
Funds. Under such Agreement, BISYS Fund Services Ohio, Inc. maintains the
accounting

<PAGE>

books and records for the Funds, including journals containing an itemized daily
record of all purchases and sales of portfolio securities, all receipts and
disbursements of cash and all other debits and credits, general and auxiliary
ledgers reflecting all asset, liability, reserve, capital, income and expense
accounts, including interest accrued and interest received, and other required
separate ledger accounts; maintains a monthly trial balance of all ledger
accounts; performs certain accounting services for the Funds, including
calculation of the daily net asset value per Share, calculation of the dividend
and capital gain distributions, if any, and of yield, reconciliation of cash
movements with U.S. Bank and The Bank of New York, affirmation to U.S. Bank and
The Bank of New York of portfolio trades and cash settlements, verification and
reconciliation with U.S. Bank and The Bank of New York of daily trade activity;
provides certain reports; obtains dealer quotations, prices from a pricing
service or matrix prices on all portfolio securities in order to mark the
portfolio to the market; and prepares an interim balance sheet, statement of
income and expense, and statement of changes in net assets for the Funds.

Auditors
- --------

The firm of Deloitte & Touche LLP, 1700 Courthouse Plaza N.E., Dayton, Ohio
45402, serves as independent auditors for the Trust. Its services comprise
auditing the Trust's financial statements and advising the Trust as to certain
accounting and tax matters.

Legal Counsel
- -------------

Dechert Price & Rhoads, 1500 K Street, N.W., Washington, D.C. 20005 is
counsel to the Trust and has passed upon the legality of the Shares offered
hereby.

ADDITIONAL INFORMATION

Description of Shares
- ---------------------

The Trust is a Massachusetts business trust. The Trust was organized on
May 19, 1994, and the Trust's Declaration of Trust was filed with the Secretary
of State of the Commonwealth of Massachusetts on May 19, 1994 and amended
effective May 1, 1995 and __________, 1996. The Declaration of Trust authorizes
the Board of Trustees to issue an unlimited number of Shares, which are units of
beneficial interest, without par value. The Trust currently has seventeen
series of Shares which represent interests in each series of the Trust. The
Shares of each of the Funds of the Trust, other than the Money Funds, are
offered in three separate classes: Class A Shares, Class C Shares and Class Y S-
hares. Shares of the Money Funds are also offered in three separate classes:
Class A Shares, Class Q Shares and Class Y Shares. The Trust's Declaration of
Trust authorizes the Board of Trustees to divide or redivide any unissued Shares
of the Trust into one or more additional series by setting or changing in any
one or more respects their respective preferences, conversion or other rights,
voting power, restrictions, limitations as to dividends, qualifications, and
terms and conditions of redemption.

<PAGE>

Each Fund intends to seek a ruling from the Internal Revenue Service
("IRS") to the effect that differing distributions among the classes of its
Shares will not result in the Fund's dividends and other distributions being
regarded as "preferential dividends" under the Internal Revenue Code of 1986, as
amended (the "Code"). Generally, a preferential dividend is a dividend which a
Fund cannot treat as having been distributed for purposes of determining (i)
whether the Fund qualifies as a regulated investment company ("RIC") for federal
tax purposes and (ii) the Fund's tax calculations. In order to qualify as a
RIC, each Fund must satisfy certain requirements, including an income
distribution requirement. If a Fund so qualifies, it generally will not be
subject to federal tax on income timely distributed to Shareholders, and
distributions from the Fund may qualify as capital gain dividends or exempt-
interest dividends, generally depending on the type of income generated by the
Fund. While similar rulings have been issued previously by the IRS, complete
assurance cannot, of course, be given that the Funds will actually receive such
rulings. Although an adverse determination by the IRS is not currently
expected, the Funds may be required to reassess their multiple class share
structure (and reserve the right to do so) were the IRS not to rule favorably
since that could impact on the Funds' ability to qualify as RICs. In addition,
were the IRS not to rule favorably, each Fund might make additional
distributions (which could carry interest and interest-related charges to the
Fund) if doing so would assist the Funds in complying with their general
practice of distributing sufficient income to reduce or eliminate U.S. federal
taxes.

Shares have no subscription or preemptive rights and only such conversion
or exchange rights as the Board of Trustees may grant in its discretion. When
issued for payment as described in the Prospectuses and this SAI, the Trust's
Shares will be fully paid and non-assessable. In the event of a liquidation or
dissolution of the Trust, Shareholders of a Fund are entitled to receive the
assets available for distribution belonging to that Fund, and a proportionate
distribution, based upon the relative asset values of the respective series, of
any general assets not belonging to any particular series which are available
for distribution.

Rule 18f-2 under the 1940 Act provides that any matter required to be
submitted to the holders of the outstanding voting securities of an investment
company such as the Trust shall not be deemed to have been effectively acted
upon unless approved by the holders of a majority of the outstanding Shares of
each Fund affected by the matter. For purposes of determining whether the
approval of a majority of the outstanding Shares of a Fund will be required in
connection with a matter, a Fund will be deemed to be affected by a matter
unless it is clear that the interests of each Fund in the matter are identical,
or that the matter does not affect any interest of the Fund. Under Rule 18f-2,
the approval of an investment advisory agreement or any change in investment
policy submitted to Shareholders would be effectively acted upon with respect to
a Fund only if approved

<PAGE>

by a majority of the outstanding Shares of such Fund. However, Rule 18f-2 also
provides that the ratification of independent public accountants, the approval
of principal underwriting contracts, and the election of Trustees may be
effectively acted upon by Shareholders of the Trust voting without regard to
Fund.

Vote of a Majority of the Outstanding Shares
- --------------------------------------------

As used in the Funds' Prospectuses and the SAI, "vote of a majority of the
outstanding Shares of the Trust or the Fund" means the affirmative vote, at an
annual or special meeting of Shareholders duly called, of the lesser of (a) 67%
or more of the votes of Shareholders of the Trust or the Fund present at such
meeting at which the holders of more than 50% of the votes attributable to the
Shareholders of record of the Trust or the Fund are represented in person or by
proxy, or (b) the holders of more than 50% of the outstanding votes of
Shareholders of the Trust or the Fund.

Principal Shareholders
- ----------------------

As of __________, 1996, the Trustees and officers of the Trust as a group
owned beneficially, directly or indirectly, less than one percent of the
outstanding Shares of the Trust and each of its Funds.

The following tables indicate each additional person known by the Funds to
own beneficially 5% or more of the Shares of the Funds as of __________, 1996:

[TO BE PROVIDED IN POST-EFFECTIVE AMENDMENT NO. 8]

Shareholder and Trustee Liability
- ---------------------------------

Under Massachusetts law, holders of units of interest in a business trust
may, under certain circumstances, be held personally liable as partners for the
obligations of the trust. However, the Trust's Declaration of Trust provides
that Shareholders shall not be subject to any personal liability for the
obligations of the Trust. The Declaration of Trust provides for indemnification
out of the Trust's property of any Shareholder held personally liable solely by
reason of his or her being or having been a Shareholder. The Declaration of
Trust also provides that the Trust shall, upon request, reimburse any
Shareholder for all legal and other expenses reasonably incurred in the defense
of any claim made against the Shareholder for any act or obligation of the
Trust, and shall satisfy any judgment thereon. Thus, the risk of a Shareholder
incurring financial loss on account of Shareholder liability is limited to
circumstances in which the Trust itself would be unable to meet its obligations.

The Declaration of Trust states further that no Trustee, officer, or agent
of the Trust shall be personally liable in connection with the administration or
preservation of the assets of the Trust or the conduct of the Trust's business;
nor shall any Trustee, officer, or agent be personally liable

39
<PAGE>

to any person for any action or failure to act except for his or her own bad
faith, willful misfeasance, gross negligence, or reckless disregard of his
duties. The Declaration of Trust also provides that all persons having any
claim against the Trustees or the Trust shall look solely to the assets of the
Trust for payment.

Additional Tax Information
- --------------------------

The following discussion sets forth additional information summarizing
certain U.S. federal tax considerations incident to an investment in a Fund.

Taxation of the Funds. Each Fund intends to qualify and elect to be
---------------------
treated as a RIC under Subchapter M of the Code. If so qualified, a Fund
generally will not be subject to federal income tax to the extent it distributes
its investment company taxable income (which includes interest on taxable
investments and the excess of net short-term capital gains over net long-term
capital losses) and net capital gains (the excess of net long-term capital gains
over net short-term capital losses) to Shareholders in a timely manner. To
qualify as a RIC, a Fund generally must, among other things, (a) derive in each
taxable year at least 90% of its gross income from dividends, interest, payments
with respect to certain securities loans, and gains from the sale or other
disposition of stock, securities or foreign currencies, or other income derived
with respect to its business of investing in such stock, securities or curren-
cies; (b) derive in each taxable year less than 30% of its gross income from the
sale or other disposition of certain assets held less than three months, namely:
(i) stock or securities; (ii) options, futures, or forward contracts (other than
those on foreign currencies); or (iii) foreign currencies (or options, futures,
or forward contracts on foreign currencies) that are not directly related to the
Fund's principal business of investing in stock or securities (or options and
futures with respect to stock or securities) (the "30% Limitation"); and (c)
diversify its holdings so that, at the end of each fiscal quarter, (i) at least
50% of the market value of the Fund's assets is represented by cash, U.S.
Government securities, the securities of other RICs and other securities, with
such other securities limited, in respect of any one issuer, to an amount not
greater than 5% of the value of the Fund's total assets and 10% of the
outstanding voting securities of such issuer, and (ii) not more than 25% of the
value of its total assets is invested in the securities of any one issuer (other
than U.S. Government securities and the securities of other RICs).
Additionally, a Fund must, for each taxable year, distribute to Shareholders at
least 90% of its investment company taxable income and at least 90% of its net
tax-exempt interest income.

The Treasury Department is authorized to issue regulations providing that
foreign currency gains that are not directly related to a Fund's principal
business of investing in stock or securities (or options and futures with
respect to stock or securities) will be excluded from the income which qualifies
for purposes of the 90% gross income requirement described above. To date,
however, no regulations have been issued.

Amounts, other than tax-exempt interest, not distributed by a Fund on a
timely basis in accordance with a calendar year distribution requirement are
subject to a nondeductible 4% excise

<PAGE>

tax at the Fund level. To avoid the tax, each Fund must distribute during each
calendar year an amount equal to the sum of: (1) at least 98% of its ordinary
income (not taking into account any capital gains or losses or tax-exempt
interest) for the calendar year; (2) at least 98% of its capital gains in excess
of its capital losses (adjusted for certain ordinary losses) for a one-year
period generally ending on October 31 of the calendar year; and (3) all taxable
ordinary income and capital gains for previous years that were not distributed
during such years. To avoid application of the excise tax, each Fund intends to
make distributions in accordance with the calendar year distribution
requirements. A distribution will be treated as paid on December 31 of the
current calendar year if it is declared by a Fund in October, November or
December of the year with a record date in such a month and paid by the Fund
during January of the following year. Such distributions will be treated as
received by Shareholders in the calendar year the distributions are declared,
rather than the calendar year in which the distributions are actually received.

Options, Futures and Foreign Currency Forward Contracts. Some of the
-------------------------------------------------------
options, futures and foreign currency forward contracts in which a Fund may
invest may be "section 1256 contracts." Gains (or losses) on these contracts
generally are considered to be 60% long-term and 40% short-term capital gains or
losses; however, foreign currency gains or losses arising from certain section
1256 contracts are ordinary in character. Also, section 1256 contracts held by
a Fund at the end of each taxable year (and on certain other dates prescribed in
the Code) are "marked-to-market" with the result that unrealized gains or losses
are treated as though they were realized.

The transactions in options, futures and forward contracts undertaken by a
Fund may result in "straddles" for federal income tax purposes. The straddle
rules may affect the character of gains or losses realized by a Fund. In
addition, losses realized by a Fund on positions that are part of a straddle may
be deferred under the straddle rules, rather than being taken into account in
calculating the taxable income for the taxable year in which such losses are
realized. Because only a few regulations implementing the straddle rules have
been promulgated, the consequences of such transactions to a Fund are not
entirely clear. The straddle rules may increase the amount of short-term
capital gain realized by a Fund, which is taxed as ordinary income when
distributed to Shareholders.

The Funds may make one or more of the elections available under the Code
which are applicable to straddles. If a Fund makes any of the elections, the
amount, character and timing of the recognition of gains or losses from the
affected straddle positions will be determined under rules that vary according
to the election(s) made. The rules applicable under certain of the elections
may operate to accelerate the recognition of gains or losses from the affected
straddle positions.

Because application of the straddle rules may affect the character of gains
or losses, defer losses and/or accelerate the recognition of gains or losses
from the affected straddle positions, the amount which must be distributed to
Shareholders as ordinary income or long-term capital gain

<PAGE>

may be increased or decreased substantially as compared to a Fund that did not
engage in such transactions.

The 30% Limitation and the diversification requirements applicable to each
Fund's assets may limit the extent to which a Fund will be able to engage in
transactions in options, futures and forward contracts.

Currency Fluctuations -- "Section 988" Gains or Losses. Gains or losses
------------------------------------------------------
attributable to fluctuations in exchange rates which occur between the time a
Fund accrues income or other receivables or accrues expenses or other
liabilities denominated in a foreign currency and the time the Fund actually
collects such receivables or pays such liabilities generally are treated as
ordinary income or ordinary loss. Similarly, on disposition of some
investments, including debt securities denominated in a foreign currency and
certain forward contracts, gains or losses attributable to fluctuations in the
value of the foreign currency between the date of acquisition of the security
and the date of disposition also are treated as ordinary gain or loss. These
gains and losses, referred to under the Code as "section 988" gains or losses,
increase or decrease the amount of a Fund's investment company taxable income
available to be distributed to its Shareholders as ordinary income. If section
988 losses exceed other investment company taxable income during a taxable year,
a Fund would not be able to make any ordinary dividend distributions, or
distributions made before the losses were realized would be recharacterized as a
return of capital to Shareholders, rather than as an ordinary dividend, reducing
each Shareholder's basis in his or her Fund Shares.

Investments in Passive Foreign Investment Companies. A Fund may invest in
---------------------------------------------------
shares of foreign corporations which may be classified under the Code as passive
foreign investment companies ("PFICs"). In general, a foreign corporation is
classified as a PFIC if at least one-half of its assets constitute investment-
type assets, or 75% or more of its gross income is investment-type income. If a
Fund receives a so-called "excess distribution" with respect to PFIC stock, the
Fund itself may be subject to a tax on a portion of the excess distribution,
whether or not the corresponding income is distributed by the Fund to
Shareholders. In general, under the PFIC rules, an excess distribution is
treated as having been realized ratably over the period during which the Fund
held the PFIC shares. The Fund itself will be subject to tax on the portion, if
any, of an excess distribution that is so allocated to prior Fund taxable years
and an interest factor will be added to the tax, as if the tax had been payable
in such prior taxable years. Certain distributions from a PFIC, as well as gain
from the sale of PFIC shares, are treated as excess distributions. Excess
distributions are characterized as ordinary income even though, absent
application of the PFIC rules, certain excess distributions might have been
classified as capital gain.

A Fund may be eligible to elect alternative tax treatment with respect to
PFIC shares. Under an election that currently is available in some
circumstances, the Fund generally would be required to include in its gross
income its share of the earnings of a PFIC on a current basis, regardless of
whether distributions are received from the PFIC in a given year. If this
election were made, the special rules, discussed above, relating to the taxation
of excess distributions,

<PAGE>

would not apply. In addition, another election may be available that would
involve marking-to-market a Fund's PFIC shares at the end of each taxable year
(and on certain other dates prescribed in the Code), with the result that
unrealized gains are treated as though they were realized. If this election
were made, tax at the Fund level under the PFIC rules would generally be
eliminated, but the Fund could, in limited circumstances, incur nondeductible
interest charges. A Fund's intention to qualify annually as a RIC may limit its
elections with respect to PFIC shares.

Because the application of the PFIC rules may affect, among other things,
the character of gains, the amount of gain or loss and the timing of the
recognition of income with respect to PFIC shares, as well as subject the Fund
itself to tax on certain income from PFIC shares, the amount that must be
distributed to Shareholders, and which will be taxed to Shareholders as ordinary
income or long-term capital gain, may be increased or decreased substantially as
compared to a Fund that did not invest in PFIC shares.

Foreign Taxes. Income received by a Fund from sources within a foreign
-------------
country may be subject to withholding and other income or similar taxes imposed
by that country. If more than 50% of the value of a Fund's total assets at the
close of its taxable year consists of securities of foreign corporations, the
Fund will be eligible and may elect to "pass-through" to the Fund's Shareholders
the amount of foreign income and similar taxes paid by the Fund. Pursuant to
this election, a Shareholder will be required to include in gross income (in
addition to taxable dividends actually received) his pro rata share of the
--- ----
foreign income and similar taxes paid by a Fund, and will be entitled either to
claim a deduction (as an itemized deduction) for his pro rata share of such
--- ----
foreign taxes in computing his taxable income or to use it as a foreign tax
credit against his U.S. federal income taxes, subject to limitations. Foreign
taxes may not be deducted by a Shareholder that is an individual in computing
the alternative minimum tax. Each Shareholder will be notified within 60 days
after the close of a Fund's taxable year whether the foreign taxes paid by the
Fund will "pass-through" for that year and, if so, such notification will
designate (a) the Shareholder's portion of the foreign taxes paid to each such
country, and (b) the portion of the dividend which represents income derived
from sources within each such country.

Generally, a credit for foreign taxes is subject to the limitation that it
may not exceed the Shareholder's U.S. tax attributable to his total foreign
source taxable income. For this purpose, if a Fund makes the election described
in the preceding paragraph, the source of a Fund's income flows through to its
Shareholders. With respect to a Fund, gains from the sale of securities
generally will be treated as derived from U.S. sources and section 988 gains
generally will be treated as ordinary income derived from U.S. sources. The
limitation on the foreign tax credit is applied separately to foreign source
passive income (as defined for purposes of the foreign tax credit), including
foreign source passive income received from a Fund. In addition, the foreign
tax credit may offset only 90% of the alternative minimum tax imposed on
corporations and individuals. If a Fund is not eligible to make the election
described above, the foreign income and similar taxes it pays generally will
reduce investment company taxable income and distributions by a Fund will be
treated as United States source income.

<PAGE>

The foregoing is only a general description of the foreign tax credit under
current law. Because application of the credit depends on the particular
circumstances of each Shareholder, Shareholders are advised to consult their own
tax advisers.

Debt Securities Acquired at a Discount. Some of the debt securities (with
--------------------------------------
a fixed maturity date of more than one year from the date of issuance) that may
be acquired by a Fund may be treated as debt securities that are issued
originally at a discount. Generally, the amount of the original issue discount
("OID") is treated as interest income and is included in income over the term of
the debt security, even though payment of that amount is not received until a
later time, usually when the debt security matures. A portion of the OID
includable in income with respect to certain high-yield corporate debt
securities may be treated as a dividend for purposes of the corporate dividends-
received deduction. OID on an obligation, the interest from which is exempt
from federal income tax, is not taxable.

Some of the debt securities (with a fixed maturity date of more than one
year from the date of issuance) that may be acquired by a Fund in the secondary
market may be treated as having market discount. Generally, gain recognized on
the disposition of, and any partial payment of principal on, a debt security
having market discount is treated as ordinary income to the extent the gain, or
principal payment, does not exceed the "accrued market discount" on such debt
security. In addition, the deduction of any interest expenses attributable to
debt securities having market discount may be deferred. Market discount
generally accrues in equal daily installments. A Fund may make one or more of
the elections applicable to debt securities having market discount, which could
affect the character and timing of the recognition of income.

Some debt securities (with a fixed maturity date of one year or less from
the date of issuance), the interest from which is taxable, that may be acquired
by a Fund may be treated as having acquisition discount, or OID in the case of
certain types of debt securities. Generally, a Fund will be required to include
the acquisition discount, or OID, in income over the term of the debt security,
even though payment of that amount is not received until a later time, usually
when the debt security matures. A Fund may make one or more of the elections
applicable to debt securities having acquisition discount, or OID, which could
affect the character and timing of recognition of income.

Each Fund generally will be required to distribute dividends to
Shareholders representing discount on debt securities that is currently
includable in income, even though cash representing such income may not have
been received by the Fund. Cash to pay such dividends may be obtained from
sales proceeds of securities held by the Fund or by borrowing.

Disposition of Shares. Upon a redemption, sale or exchange of Shares of a
---------------------
Fund, a Shareholder will realize a taxable gain or loss depending upon the basis
of the Shares. However, dispositions of Shares of the Money Funds will not give
rise to a gain or loss if the relevant Fund maintains a net asset value per
Share of one dollar. A gain or loss will be treated as capital gain or loss if
the Shares are capital assets in the Shareholder's hands and generally will be
long-term

<PAGE>

or short-term, depending upon the Shareholder's holding period for the Shares.
Any loss realized on a redemption, sale or exchange will be disallowed to the
extent the Shares disposed of are replaced (including through reinvestment of
dividends) within a period of 61 days beginning 30 days before and ending 30
days after the Shares are disposed of. In such a case, the basis of the Shares
acquired will be adjusted to reflect the disallowed loss. Any loss realized by
a Shareholder on the sale of a Fund's Shares held by the Shareholder for six
months or less will be treated for tax purposes as a long-term capital loss to
the extent of any distributions of capital gain dividends received or treated as
having been received by the Shareholder with respect to such Shares.
Furthermore, a loss realized by a Shareholder of the Tax-Free Bond Fund on the
redemption, sale or exchange of Shares of the Fund with respect to which exempt-
interest dividends have been paid will, to the extent of such exempt-interest
dividends, be disallowed if such Shares have been held by the Shareholder for
six months or less at the time of their disposition.

In some cases, Shareholders will not be permitted to take sales charges
into account for purposes of determining the amount of gain or loss realized on
the disposition of their Shares. This prohibition generally applies where (1)
the shareholder incurs a sales charge in acquiring the stock of a RIC, (2) the
stock is disposed of before the 91st day after the date on which it was
acquired, and (3) the shareholder subsequently acquires shares of the same or
another RIC and the otherwise applicable sales charge is reduced or eliminated
under a "reinvestment right" received upon the initial purchase of shares of
stock. In that case, the gain or loss recognized will be determined by
excluding from the tax basis of the shares exchanged all or a portion of the
sales charge incurred in acquiring those shares. This exclusion applies to the
extent that the otherwise applicable sales charge with respect to the newly
acquired shares is reduced as a result of having incurred a sales charge
initially. Sales charges affected by this rule are treated as if they were
incurred with respect to the stock acquired under the reinvestment right. This
provision may be applied to successive acquisitions of stock.

Backup Withholding. The Funds will be required to report to the IRS all
------------------
distributions of investment company taxable income and net capital gains, and
the gross proceeds from the redemption of Shares, except in the case of certain
exempt Shareholders. All distributions of investment company taxable income and
net capital gains, and proceeds from the redemption of Fund Shares, will be
subject to withholding of federal income tax at the rate of 31% ("backup
withholding") in the case of nonexempt Shareholders if (1) the Shareholder fails
to furnish the Fund with and to certify the Shareholder's correct taxpayer
identification number or social security number, (2) the IRS notifies the
Shareholder or the Fund that the Shareholder has failed to report properly
certain interest and dividend income to the IRS and to respond to notices to
that effect, or (3) when required to do so, the Shareholder fails to certify
that he or she is not subject to backup withholding. It is not expected that
the gross proceeds from redemptions of Shares of the Money Funds will be
reportable to the IRS or subject to backup withholding if the Money Funds
maintain a net asset value per Share of one dollar.

The Exempt Funds. Each Exempt Fund intends to manage its portfolio so that
----------------
it will be eligible to pay "exempt-interest dividends" to Shareholders. A RIC
will so qualify if, at the close

<PAGE>

of each quarter of its taxable year, at least 50% of the value of its total
assets consists of state, municipal, and certain other securities, the interest
on which is exempt from the regular federal income tax. To the extent that
dividends distributed to Shareholders by an Exempt Fund are derived from such
interest income and are designated as "exempt-interest dividends" by the
distributing Fund, they will be excludable from a Shareholder's gross income for
regular federal income tax purposes. In computing the alternative minimum tax
liability of a corporation, the entire amount of exempt-interest dividends will
be part of an adjustment in computing alternative minimum taxable income and
will have to be taken into account for purposes of the environmental tax under
Code section 59A. Shareholders are required to report the receipt of tax-exempt
interest and exempt-interest dividends on their federal income tax returns. An
Exempt Fund would not be suitable investments for tax-exempt institutions and
may not be suitable for retirement plans qualified under the Code, including
individual retirement accounts, since such plans and accounts are generally tax-
exempt and, therefore, would not gain any additional benefit from receiving
exempt-interest dividends, and such dividends would be ultimately taxable to the
beneficiaries when distributed to them. An Exempt Fund will inform Shareholders
annually as to the portion of the distributions from the Fund which constitute
"exempt-interest dividends."

Other Taxation. Distributions and redemptions may also be subject to
--------------
additional state, local and foreign taxes depending on each Shareholder's parti-
cular situation. Non-U.S. Shareholders may be subject to U.S. tax rules that
differ significantly from those summarized herein. This discussion does not
purport to deal with all of the tax consequences applicable to the Funds or
Shareholders (for example, a Fund may be subject to state and local taxation).
Shareholders are advised to consult their own tax advisers with respect to the
particular tax consequences to them of an investment in a Fund.

Yields of the Money Funds
- -------------------------

Each of the standardized seven-day yields for each Money Fund is computed
by determining the net change, exclusive of capital changes, in the value of a
hypothetical pre-existing account in that Fund having a balance of one Share at
the beginning of the period, subtracting a hypothetical charge reflecting
deductions from Shareholder accounts, and dividing the difference by the value
of the account at the beginning of the base period to obtain the base period
return, and then multiplying the base period return by (365/base period). The
net change in the account value of each Money Fund includes the value of
additional Shares purchased with dividends from the original Share, dividends
declared on both the original Share and any such additional Shares, and all
fees, other than nonrecurring account or sales charges, that are charged to all
Shareholder accounts in proportion to the length of the base period and assuming
that Fund's average account size. The capital changes to be excluded from the
calculation of the net change in account value are net realized gains and losses
from the sale of securities and unrealized appreciation and depreciation. Yield
for the seven-day period ended July 31, 1995 for Class A Shares, Class Q Shares,
and Class Y Shares of the U.S. Treasury Fund was 5.00%, 5.20% and 5.41%,
respectively, the yield for that period for Class A Shares, Class Q Shares, and
Class Y Shares of the Money Fund was 5.01%, 5.41% and 5.41%, respectively, and
the yield for the

<PAGE>

same period for the Class A Shares, Class Q Shares, and Class Y Shares of the
Tax-Free Money Market Fund was 2.78%, 2.93% and 3.19%, respectively.

Each of the effective yields for the Money Funds is computed by compounding
the base period return, as calculated above by adding 1 to the base period
return, raising the sum to a power equal to 365 divided by base period and
subtracting 1 from the result. Effective yield for the seven-day period ended
July 31, 1995 for Class A Shares, Class Q Shares, and Class Y Shares of the U.S.
Treasury Fund was 5.13%, 5.34% and 5.56%, respectively, the effective yield for
that period for Class A Shares, Class Q Shares, and Class Y Shares of the Money
Fund was 5.14%, 5.56% and 5.56%, respectively, and the effective yield for the
same period for the Class A Shares, Class Q Shares, and Class Y Shares of the
Tax-Free Money Market Fund was 2.82%, 2.97% and 3.24%, respectively.

Each of the 30-day yields and effective yields are calculated as described
above except than the base period is 30 days rather than seven days. Yield for
the 30-day period ended July 31, 1995 for Class A Shares, Class Q Shares, and
Class Y Shares of the U.S. Treasury Fund was 5.02%, 5.22% and 5.43%,
respectively, the yield for that period for Class A Shares, Class Q Shares, and
Class Y Shares of the Money Fund was 5.03%, 5.43% and 5.43%, respectively, and
the yield for the same period for the Class A Shares, Class Q Shares, and Class
Y Shares of the Tax-Free Money Market Fund was 2.66%, 2.81% and 3.07%,
respectively. Effective yield for the 30-day period ended July 31, 1995 for
Class A Shares, Class Q Shares, and Class Y Shares of the U.S. Treasury Fund was
5.14%, 5.35% and 5.56%, respectively, the effective yield for that period for
Class A Shares, Class Q Shares, and Class Y Shares of the Money Fund was 5.14%,
5.56% and 5.43%, respectively, and the effective yield for the same period for
the Class A Shares, Class Q Shares, and Class Y Shares of the Tax-Free Money
Market Fund was 2.70%, 2.85% and 3.12%, respectively.

The Tax-Free Money Market Fund's tax-equivalent yields are computed by
dividing that portion of the Tax-Free Money Market Fund's yield which is tax-
exempt by one minus the stated income tax rate and adding the result to that
portion, if any, of the Tax-Free Money Market Fund's yield that is not tax-
exempt. The Tax-Free Money Market Fund's tax-equivalent effective yields are
computed by dividing that portion of the effective yield which is tax-exempt by
one minus the stated income tax rate and adding to that result the portion, if
any, of the Tax-Free Money Market Fund's effective yield that is not tax-exempt.

Yields of the Parent Funds, the Equity Funds and the Income Funds.
- -----------------------------------------------------------------

Yields of each of the Parent Funds, the Equity Funds and the Income Funds
are computed by analyzing net investment income per Share for a recent 30-day
period and dividing that amount by a Share's maximum offering price (reduced by
any undeclared earned income expected to be paid shortly as a dividend) on the
last trading day of that period. Net investment income will reflect
amortization of any market value premium or discount of fixed income securities
(except for obligations backed by mortgages or other assets) and may include
recognition of a pro rata

<PAGE>

portion of the stated dividend rate of dividend paying portfolio securities.
The yield of each of the Equity Funds and the Income Funds will vary from time
to time depending upon market conditions, the composition of a Fund's portfolio
and operating expenses of the Trust allocated to each Fund. These factors and
possible differences in the methods used in calculating yield should be
considered when comparing a Fund's yield to yields published for other
investment companies and other investment vehicles. Yield should also be
considered relative to changes in the value of a Fund's Shares and to the
relative risks associated with the investment objective and policies of each of
the Funds. Yield for the 30-day period ended July 31, 1995 for the Large
Companies Value Fund was 1.56% (1.63% without sales charge) for Class A Shares,
0.82% for Class C Shares and 1.78% for Class Y Shares. Yield for the 30-day
period ended July 31, 1995 for the Optimized Fund was 1.55% (1.63% without sales
charge) for Class A Shares, 0.90% for Class C Shares and 1.93% for Class Y
Shares. Yield for the 30-day period ended July 31, 1995 for the Small Companies
Fund was 0.15% (0.15% without sales charge) for Class A Shares, -0.56% for Class
C Shares and 0.36% for Class Y Shares. Yield for the 30-day period ended July
31, 1995 for the Intermediate Bond Fund was 4.96% (5.14% without sales charge)
for Class A Shares, 4.38% for the Class C Shares and 5.39% for the Class Y
Shares. Yield for the 30-day period ended July 31, 1995 for the Bond Fund was
1.13% (1.17% without sales charge) for Class A Shares, 2.34% for Class C Shares
and 5.68% for Class Y Shares.

In addition, for the Tax-Free Bond Fund, tax-equivalent yields are computed
by dividing that portion of the Fund's yield (as computed above) which is tax-
exempt by one minus a stated income tax rate and adding that result to that
portion, if any, of the yield of that Fund which is not tax exempt.

At any time in the future, yields may be higher or lower than past yields
and there can be no assurance that any historical results will continue.

Investors in the Parent Funds, the Equity Funds and the Income Funds are
specifically advised that Share prices, expressed as the net asset values per
Share, will vary just as yields will vary.

Calculation of Total Return
- ---------------------------

Average annual total return is a measure of the change in value of an
investment in a Fund over the period covered, which assumes any dividends or
capital gains distributions which are reinvested in the Fund immediately rather
than paid to the investor in cash. Average annual total return will be
calculated by: (1) adding to the total number of Shares purchased by a
hypothetical $1,000 investment in the Fund and (less the maximum sales charge,
if any) all additional Shares which would have been purchased if all dividends
and distributions paid or distributed during the period had been immediately
reinvested; (2) calculating the value of the hypothetical initial investment of
$1,000 as of the end of the period by multiplying the total number of Shares
owned at the end of the period by the net asset value per Share on the last
trading day of the period; (3) assuming redemption at the end of the period; and
(4) dividing this account value for the

<PAGE>

hypothetical investor by the initial $1,000 investment and analyzing the result
for periods of less than one year. Aggregate total return is calculated
similarly to average annual total return except that the return figure is
aggregated over the relevant period instead of annualized. Total return for the
period from August 1, 1994 (commencement of operations) through July 31, 1995
for the Large Companies Value Fund was 19.01% (24.61% without sales charge) for
Class A Shares, 21.78% (22.78% without contingent deferred sales charge) for
Class C Shares and 25.04% for Class Y Shares. Total return for the period from
May 2, 1995 (commencement of operations) through July 31, 1995 for the Optimized
Fund was 4.72% (9.64% without sales charge) for Class A Shares, 8.41% (9.41%
without contingent deferred sales charge) for Class C Shares and 9.74% for Class
Y Shares. Total return for the period from July 3, 1995 (commencement of
operations) through July 31, 1995 for the International Fund was -0.19% (4.50%
without sales charge) for Class A Shares, 3.60% (4.60% without contingent
deferred sales charge) for Class C Shares and 4.80% for Class Y Shares. Total
return for the period from August 1, 1994 (commencement of operations) through
July 31, 1995 for the Small Companies Fund was 28.26% (34.29% without sales
charge) for Class A Shares, 32.02% (33.02% without contingent deferred sales
charge) for Class C Shares and 34.76% for Class Y Shares. Total return for the
period from May 2, 1995 (commencement of operations) through July 31, 1995 for
the Bond Fund was -0.51% (3.07% without sales charge) for Class A Shares, 2.35%
(3.35% without contingent deferred sales charge) for Class C Shares and 4.58%
for Class Y Shares. Total return for the period from August 1, 1994
(commencement of operations) through July 31, 1995 for the Intermediate Bond
Fund was 2.96% (6.67% without sales charge) for Class A Shares, 4.42% (5.42%
without contingent deferred sales charge) for Class C Shares and 8.09% for Class
Y Shares. Total return for the period from August 1, 1994 (commencement of
operations) through July 31, 1995 for the Money Market Fund was 4.97% for Class
A Shares and 5.40% for Class Y Shares. Total return for the Class Q Shares of
the Money Market Fund for the period from January 10, 1995 (commencement of
operations) through July 31, 1995 was 3.13%. Total return for the period from
January 11, 1995 (commencement of operations) through July 31, 1995 for the U.S.
Treasury Fund was 2.79% for Class A Shares, 2.90% for Class Q Shares and 3.02%
for Class Y Shares. Total return for the period from January 9, 1995
(commencement of operations) through July 31, 1995 for the Tax-Free Money Market
Fund was 1.66% for Class A Shares, 1.73% for Class Q Shares and 1.88% for Class
Y Shares.

Each Fund may also present its average annual total return, aggregate total
return and yield, as the case may be, excluding the effect of a sales charge, if
any.

Distribution Rates
- ------------------

Each of the Parent Funds, the Equity Funds and the Income Funds may from
time to time advertise current distribution rates. Distribution rates are
computed by dividing the distribution per Share of a class made by a Fund over a
twelve-month period by the maximum offering price per Share of that class. The
calculation of income in the distribution rate includes both income and capital
gain dividends and does not reflect unrealized gains or losses, although a Fund
may also present a distribution rate excluding the effect of capital gains. The
distribution rate differs

<PAGE>

from the yield, because it includes capital items which are often non-recurring
in nature, whereas yield does not include such items. Distribution rates may
also be presented excluding the effect of a sales charge, if any.

Performance Comparisons
- -----------------------

Investors may judge the performance of the Funds by comparing their
performance to the performance of other mutual funds or mutual fund portfolios
directly or through various mutual fund or market indices such as the EAFE Index
and those prepared by Dow Jones & Co., Inc., Standard & Poor's Corporation,
Shearson Lehman Brothers, Inc. and The Russell 2000 Index, and to data prepared
by Lipper Analytical Services, Inc., a widely recognized independent service
which monitors the performance of mutual funds, Morningstar, Inc. and the
Consumer Price Index. Comparisons may also be made to indices or data published
in various general and financial press sources, including Donoghue's MONEY FUND
REPORT of Holliston, Massachusetts 01746, a nationally recognized money market
fund reporting service, Money Magazine, Forbes, Barron's, The Wall Street
Journal, The Bond Buyer's Weekly 20-Bond Index, The Bond Buyer's Index, The Bond
Buyer, The New York Times, Business Week, Pensions and Investments, and U.S.A.
Today. In addition to performance information, general information about these
Funds that appears in a publication such as those mentioned above may be
included in advertisements and in reports to Shareholders.

From time to time, the Funds may include the following types of information
in advertisements, supplemental sales literature and reports to Shareholders:
(1) discussions of general economic or financial principles (such as the effects
of compounding, the benefits of dollar-cost averaging, and asset allocations
appropriate for various financial goals); (2) discussions of general economic
trends; (3) presentations of statistical data to supplement such discussions;
(4) descriptions of past or anticipated portfolio holdings for one or more of
the Funds; (5) descriptions of investment strategies for one or more of the
Funds; (6) descriptions or comparisons of various savings and investment
products (including, but not limited to, insured bank products, annuities,
qualified retirement plans and individual stocks and bonds), which may or may
not include the Funds; (7) comparisons of investment products (including the
Funds) with relevant market or industry indices or other appropriate benchmarks;
(8) discussions of fund rankings or ratings by recognized rating organizations;
and (9) testimonials describing the experience of persons that have invested in
one or more of the Funds. The Funds may also include calculations, such as
hypothetical compounding examples, which describe hypothetical investment
results in such communications. Such performance examples will be based on an
express set of assumptions and are not indicative of the performance of any of
the Funds.

Current yields or performance will fluctuate from time to time and are not
necessarily representative of future results. Accordingly, a Fund's yield or
performance may not provide for comparison with bank deposits or other
investments that pay a fixed return for a stated period of time. Yield and
performance are functions of a Fund's quality, composition, and maturity, as

<PAGE>

well as expenses allocated to the Fund. Fees imposed upon customer accounts for
cash management services will reduce a Fund's effective yield to customers.

Miscellaneous
- -------------

Individual Trustees are elected by the Shareholders and, subject to removal
by the vote of two-thirds of the Board of Trustees, serve for a term lasting
until the next meeting of Shareholders at which Trustees are elected. Such
meetings are not required to be held at any specific intervals. Individual
Trustees may be removed by vote of the Shareholders voting not less than a
majority of the Shares then outstanding, cast in person or by proxy at any
meeting called for that purpose, or by a written declaration signed by
Shareholders voting not less than two-thirds of the Shares then outstanding.

The Trust is registered with the Securities and Exchange Commission as a
management investment company. Such registration does not involve supervision
by the Securities and Exchange Commission of the management or policies of the
Trust.

The Prospectuses and this SAI omit certain of the information contained in
the Registration Statement filed with the Securities and Exchange Commission.
Copies of such information may be obtained from the Securities and Exchange
Commission upon payment of the prescribed fee.

The Prospectuses and this SAI are not an offering of the securities herein
described in any state in which such offering may not lawfully be made. No
salesman, dealer, or other person is authorized to give any information or make
any representation other than those contained in the Prospectuses and this SAI.

Financial Statements
- --------------------

The Trust's audited financial statements for the Funds, including the
related notes thereto, dated as of July 31, 1995, are incorporated by reference
in the SAI from the Annual Report of the Trust dated as of July 31, 1995. A
copy of the Annual Report delivered with this SAI should be retained for future
reference.

<PAGE>

APPENDIX
DESCRIPTION OF BOND RATINGS

Description of Moody's bond ratings:

Excerpts from Moody's description of its bond ratings are listed as
follows: Aaa -judged to be the best quality and they carry the smallest degree
of investment risk; Aa -judged to be of high quality by all standards - together
with the Aaa group, they comprise what are generally known as high grade bonds;
A - possess many favorable investment attributes and are to be considered as
"upper medium grade obligations"; Baa - considered to be medium grade
obligations, i.e., they are neither highly protected nor poorly secured -
----
interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time; Ba - judged to have speculative
elements, their future cannot be considered as well assured; B - generally lack
characteristics of the desirable investment; Caa - are of poor standing - such
issues may be in default or there may be present elements of danger with respect
to principal or interest; Ca - speculative in a high degree, often in default; C
- - lowest rated class of bonds, regarded as having extremely poor prospects.

Moody's also supplies numerical indicators 1, 2 and 3 to rating categories.
The modifier 1 indicates that the security is in the higher end of its rating
category; the modifier 2 indicates a mid-range ranking; and modifier 3 indicates
a ranking toward the lower end of the category.

Description of S&P's corporate and municipal bond ratings:

Excerpts from S&P's description of its bond ratings are listed as follows:
AAA - highest grade obligations, in which capacity to pay interest and repay
principal is extremely strong; AA - has a very strong capacity to pay interest
and repay principal, and differs from AAA issues only in a small degree; A - has
a strong capacity to pay interest and repay principal, although they are
somewhat more susceptible to the adverse effects of changes in circumstances and
economic conditions than debt in higher rated categories; BBB - regarded as
having an adequate capacity to pay interest and repay principal; whereas it
normally exhibits adequate protection parameters, adverse economic conditions or
changing circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for debt in this category than in higher rated
categories. This group is the lowest which qualifies for commercial bank
investment. BB, B, CCC, CC, C - predominantly speculative with respect to
capacity to pay interest and repay principal in accordance with terms of the
obligations; BB indicates the highest grade and C the lowest within the
speculative rating categories. D - interest or principal payments are in
default.

S&P applies indicators "+," no character, and "-" to its rating categories.
The indicators show relative standing within the major rating categories.

<PAGE>

Description of Moody's ratings of short-term municipal obligations:

Moody's ratings for state and municipal short-term obligations will be
designated Moody's Investment Grade, or MIG. Such ratings recognize the
differences between short-term credit and long-term risk. Short-term ratings on
issues with demand features (variable rate demand obligations) are
differentiated by the use of the VMIG symbol to reflect such characteristics as
payment upon periodic demand rather than fixed maturity dates and payments
relying on external liquidity. Ratings categories for securities in these
groups are as follows: MIG 1/VMIG 1 - denotes best quality, there is present
strong protection by established cash flows, superior liquidity support or
demonstrated broad-based access to the market for refinancing; MIG 2/VMIG 2 -
denotes high quality, margins of protection are ample although not as large as
in the preceding group; MIG 3/VMIG 3 -denotes high quality, all security
elements are accounted for but there is lacking the undeniable strength of the
preceding grades; MIG 4/VMIG 4 - denotes adequate quality, protection commonly
regarded as required of an investment security is present, but there is specific
risk; SQ - denotes speculative quality, instruments in this category lack
margins of protection.

Description of Moody's commercial paper ratings:

Excerpts from Moody's commercial paper ratings are listed as follows:
Prime - 1 -issuers (or supporting institutions) have a superior ability for
repayment of senior short-term promissory obligations; Prime - 2 - issuers (or
supporting institutions) have a strong ability for repayment of senior short-
term promissory obligations; Prime - 3 - issuers (or supporting institutions)
have an acceptable ability for repayment of senior short-term promissory
obligations; Not Prime - issuers do not fall within any of the Prime categories.

Description of S&P's rating for municipal notes and short-term municipal demand
obligations:

Rating categories are as follows: SP-1 - has a very strong or strong
capacity to pay principal and interest - those issues determined to possess
overwhelming safety characteristics will be given a plus (+) designation; SP-2 -
has a satisfactory capacity to pay principal and interest; SP-3 - issues
carrying this designation have a speculative capacity to pay principal and
interest.

Description of S&P's ratings for short-term corporate demand obligations and
commercial paper:

An S&P commercial paper rating is a current assessment of the likelihood of
timely repayment of debt having an original maturity of no more than 365 days.
Excerpts from S&P's description of its commercial paper ratings are listed as
follows: A-1 - the degree of safety regarding timely payment is strong - those
issues determined to possess extremely strong safety characteristics will be
denoted with a plus (+) designation; A-2 - capacity for timely payment is

<PAGE>

satisfactory - however, the relative degree of safety is not as high as for
issues designated "A-1"; A-3 - has adequate capacity for timely payment -
however, is more vulnerable to the adverse effects of changes in circumstances
than obligations carrying the higher designations; B - regarded as having only
speculative capacity for timely payment; C - a doubtful capacity for payment;
D - in payment default - the "D" rating category is used when interest payments
or principal payments are not made on the date due, even if the applicable grace
period has not expired, unless S&P believes that such payments will be made
during such grace period.

iii
<PAGE>

PART C
------

OTHER INFORMATION
-----------------

Item 24. Financial Statements and Exhibits
- -------- ---------------------------------

(a) Financial Statements: Audited financial statements dated as
--------------------
of July 31, 1995 are incorporated by reference in Part B of
the Registration Statement from the Trust's Annual Report
dated as of July 31, 1995 and include the following:

Independent Auditors' Report
Statements of Assets and Liabilities
Statements of Operations
Statements of Changes in Net Assets
Schedules of Portfolio Investments
Notes to Financial Statements
Financial Highlights

(b) Exhibits
--------

(1) (a) Declaration of Trust dated May 19, 19941

(b) Amended and Restated Establishment and Designation
of Series effective May 1, 1995.6

(2) Amended and Restated By-Laws6

(3) Not Applicable

(4) Certificates for Shares are not issued. Articles II
and V of the Registrant's Declaration of Trust define
rights of holders of Shares.

(5) (a) Form of Investment Advisory Agreement3

(b) Form of Amended Schedule A to the Investment
Advisory Agreement6

C-1

<PAGE>

(6) (a) Form of Distribution Agreement between Registrant
and The Winsbury Company5

(b) Form of Amended Schedule A to the Distribution
Agreement between Registrant and The Winsbury
Company6

(d) Form of Amended Schedule D to the Distribution
Agreement between Registrant and The Winsbury
Company6

(e) Form of Amended Schedule F to the Distribution
Agreement between Registrant and The Winsbury
Company6

(f) Form of Amended Schedule H to the Distribution
Agreement between Registrant and The Winsbury
Company6

(7) Not Applicable

(8) (a) Form of Custodian Agreement between Registrant and
United States National Bank of Oregon3

(b) Form of Amended Schedule A to the Custodian
Agreement between Registrant and United States
National Bank of Oregon6

(d) Form of Custodian Agreement between United States
National Bank of Oregon and The Bank of New York
Trust Company of California6

(e) Form of Sub-Custodian Agreement6

C-2

<PAGE>

(9) (a) Form of Management and Administration Agreement
between the Registrant and The Winsbury Company3

(b) Form of Amended Schedule A to the Management and
Administration Agreement between the Registrant
and The Winsbury Company6

(d) Form of Amended Schedule A to the Fund Accounting
Agreement between the Registrant and The Winsbury
Service Corporation6

(e) Form of Transfer Agency Agreement between the
Registrant and The Winsbury Service Corporation3

(f) Form of Amended Schedule A to the Transfer Agency
Agreement between the Registrant and The Winsbury
Service Corporation6

(10) Not Applicable

(11) Independent Auditors' Consent

(12) Annual Report dated July 31, 19958

(13) (a) Form of Purchase Agreement3

(b) Form of Purchase Agreement for Class Q Shares5

(14) Not Applicable

C-3

<PAGE>

(15) (a) Form of Class A Distribution and Shareholder
Services Plan3

(b) Form of Class C Distribution and Shareholder
Services Plan3

(d) Form of Servicing Agreement for Class A Shares
with Respect to Distribution Assistance and
Shareholder Services3

(e) Form of Amended Schedule A to the Servicing
Agreement for Class A Shares with Respect to
Distribution Assistance and Shareholder Services6

(f) Form of Servicing Agreement for Class C Shares
with Respect to Distribution Assistance and
Shareholder Services3

(g) Form of Amended Schedule A to the Servicing
Agreement for Class C Shares with Respect to
Distribution Assistance and Shareholder Services6

(h) Form of Servicing Agreement for Class Q Shares
with Respect to Distribution Assistance and
Shareholder Services5

(i) Form of Amended Schedule A to the Servicing
Agreement for Class Q Shares with Respect to
Distribution Assistance and Shareholder Services6

(16) (a) Form of Computation of Performance Evaluations5

(b) Addendum A to Form of Computation of Performance
Evaluations7

C-4

<PAGE>

(17) Financial Data Schedule*

(18) Form of Multiple Class Plan Pursuant to Rule 18f-36

(19) (a) Secretary's Certificate Pursuant to Rule 483(b)4

(b) Powers of Attorney4
____________________

1 Filed with Registrant's initial Registration Statement on May 20,
1994.

2 Filed with Pre-Effective Amendment No. 1 to Registrant's Registration
Statement on July 5, 1994.

3 Filed with Pre-Effective Amendment No. 2 to Registrant's Registration
Statement on July 22, 1994.

4 Filed with Post-Effective Amendment No. 1 to Registrant's Registration
Statement on November 7, 1994.

5 Filed with Post-Effective Amendment No. 2 to Registrant's Registration
Statement on January 6, 1995.

6 Filed with Post-Effective Amendment No. 4 to Registrant's Registration
Statement on April 24, 1995.

7 Filed with Post-Effective Amendment No. 5 to Registrant's Registration
Statement on June 30, 1995.

8 Filed with Post-Effective Amendment No. 6 to Registrant's Registration
Statement on November 2, 1995.

* To be filed by post-effective amendment.

Item 25. Persons Controlled by or Under Common Control with Registrant
- -------- -------------------------------------------------------------

Not applicable.

C-5

<PAGE>

Item 26. Number of Record Holders
- -------- ------------------------

As of December 31, 1995 the number of record holders of each
operative series of Shares of the Registrant were as follows:

Number of
Series Record Holders
------ --------------

Qualivest Large Companies Value Fund 146
Qualivest Small Companies Value Fund 282
Qualivest Optimized Stock Fund 48
Qualivest International Opportunities Fund 43
Qualivest Intermediate Bond Fund 29
Qualivest Diversified Bond Fund 13
Qualivest U.S. Treasury Money Market Fund 10
Qualivest Money Market Fund 17
Qualivest Tax-Free Money Market Fund 11

Item 27. Indemnification
- -------- ---------------

Reference is made to Article IV of the Registrant's Agreement and
Declaration of Trust (Exhibit 1(a)) which is incorporated by
reference herein.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, officers and
controlling persons of the Registrant by the Registrant pursuant
to the Fund's Declaration of Trust, its By-Laws or otherwise, the
Registrant is aware that in the opinion of the Securities and
Exchange Commission, such indemnification is against public
policy as expressed in the Act and, therefore, is unenforceable.
In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses
incurred or paid by trustees, officers or controlling persons of
the Registrant in connection with the successful defense of any
act, suit or proceeding) is asserted by such trustees, officers
or controlling persons in connection with shares being
registered, the Registrant will, unless in the opinion
of its counsel the matter has been settled by

C-6

<PAGE>

controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed
by the final adjudication of such issues.

Item 28. Business and Other Connections of Investment Adviser and its
- -------- ------------------------------------------------------------
Officers and Directors
----------------------

The business of the Investment Adviser is summarized under
"MANAGEMENT OF THE TRUST - Investment Adviser" in the
Prospectuses constituting Part A of this Registration Statement,
which summaries are incorporated herein by reference. The
business or other connections of each director and officer of the
Investment Adviser is currently listed in the Investment
Adviser's investment adviser registration on Form ADV (File No.
801-22741) and is hereby incorporated herein by reference
thereto.

Item 29. Principal Underwriter
- -------- ---------------------

(a) BISYS Fund Services ("BISYS") acts as distributor and
administrator for Registrant. BISYS also distributes the
securities of The Coventry Group, The Victory Portfolios,
The HighMark Group, The Parkstone Group of Funds, the
Conestoga Family of Funds, the BB&T Mutual Funds Group, The
M.S.D.&T. Funds, Inc., The ARCH Fund, Inc., The Riverfront
Funds, Inc., The ARCH Tax-Exempt Trust, the American
Performance Funds, The Sessions Group, the Pacific Capital
Funds, the AmSouth Mutual Funds, the Summit Investment
Trust, the MarketWatch Funds and the MMA Praxis Mutual
Funds, each of which is an open-end management investment
company.

(b) Partners of BISYS Fund Services are as follows:

Positions and Positions and
Name and Principal Offices with Offices with
Business Address BISYS Fund Services Registrant
- ---------------- ------------------- ----------

C-7

<PAGE>

BISYS Fund Services, Inc. Sole General Partner None
3435 Stelzer Road
Columbus, Ohio 43219-3035

WC Subsidiary Corporation Sole Limited Partner None
3435 Stelzer Road
Columbus, Ohio 43219-3035

Item 30. Location of Accounts and Records
- -------- --------------------------------

The accounts, books, and other documents required to be
maintained by Registrant pursuant to Section 31(a) of the
Investment Company Act of 1940 and rules promulgated thereunder
are in the possession of Qualivest Capital Management, Inc., 111
S.W. Fifth Avenue, Portland, Oregon 97204 (records relating to
its function as adviser for Registrant), BISYS Fund Services,
3435 Stelzer Road, Columbus, Ohio 43219-3035 (records relating to
its functions as general manager, administrator and distributor),
and BISYS Fund Services Ohio, Inc., 3435 Stelzer Road, Columbus,
Ohio 43219-3035 (records relating to its functions as transfer
agent).

Item 31. Management Services
- -------- -------------------

Not Applicable.

Item 32. Undertakings.
- -------- -------------

(a) Not Applicable.

(b) Registrant undertakes to call a meeting of Shareholders for
the purpose of voting upon the question of removal of a
Trustee or Trustees when requested to do so by the holders
of at least 10% of the Registrant's outstanding shares of
beneficial interest and in connection with such

C-8

<PAGE>

meeting to comply with the shareholders communications
provisions of Section 16(c) of the Investment Company Act of
1940.

(c) Registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's
latest Annual Report to Shareholders, upon request and
without charge.

(d) Registrant undertakes to file a post-effective amendment,
using financial statements of the Qualivest Conservative
Fund, the Qualivest Balanced Fund, the Qualivest Growth
Fund, the Qualivest Aggressive Growth Fund, the Qualivest
Large Companies Growth Fund, and the Qualivest Micro Cap
Value Fund, which need not be certified, within four to six
months from the latter of the effective date of Post-Effective
Amendment No. 7 or the date on which Shares of these Funds are
first sold (other than Shares sold for seed money).

C-9

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Post-
Effective Amendment No. 7 to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Washington, D.C., on this 26th day of January, 1996.

Qualivest Funds

By: *
-------------------------------
George R. Landreth
President and Chief Executive Officer

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, this Post-
Effective Amendment No. 7 to the Registration Statement on Form N-1A has
been signed below by the following persons on behalf of Qualivest Funds in
the capacity and on the date indicated:

Signatures Title Date
---------- ----- ----

* Trustee, January 26, 1996
- ---------------------------
George R. Landreth President and
Chief Executive
Officer

* Trustee January 26, 1996
- ---------------------------
David F. Jones

C-10

<PAGE>

* Trustee January 26, 1996
- ---------------------------
John W. Judy

* Trustee January 26, 1996
- ---------------------------
Raymond H. Lung

* Trustee January 26, 1996
- ---------------------------
Mary Anne Houlahan

* Trustee January 26, 1996
- ---------------------------
David B. Frohnmayer

* Treasurer January 26, 1996
- ---------------------------
Gregory T. Maddox (Principal
Financial
Officer and
Comptroller)

* By: /s/Jeffrey L. Steele
--------------------
Jeffrey L. Steele
as attorney-in-fact

* Powers of attorney are included as exhibits in Post-Effective
Amendment No. 1 filed November 7, 1994.

C-11

<PAGE>

Exhibit List
------------

Exhibit Exhibit
Number Name
- ------- -------

(11) Independent Auditors' Consent

Exhibit (11)
INDEPENDENT AUDITORS' CONSENT

We consent to the use in this Post-Effective Amendment No. 7 to
Registration Statement under the Securities Act of 1933 and
Amendment No. 9 to Registration Statement under the Investment
Company Act of 1940, both filed under Registration Statement No.
33-79194, of our report dated September 12, 1995 on the financial
statements of the Qualivest Tax-Free Money Market Fund, Qualivest
Intermediate Bond Fund, Qualivest Money Market Fund, Qualivest U.S.
Treasury Money Market Fund, Qualivest Small Companies Value
Fund, Qualivest Large Companies Value Fund, Qualivest Optimized
Stock Fund, Qualivest Diversified Bond Fund, and Qualivest
International Opportunities Fund, which are series of Qualivest
Funds, incorporated by reference in the Statement of Additional
Information, which is part of such Registration Statement

/s/ DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

Dayton, Ohio
January 22, 1996