PRAIRIE FUNDS, N-1A EL, 1994-10-28

PRAIRIE FUNDS
N-1A EL, 1994-10-28

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Registration Nos. 33-
811-

===============================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/

Pre-Effective Amendment No. ______ / /

Post-Effective Amendment No.______ / /

and

REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940 /X/

Amendment No. ______ / /

(Check appropriate box or boxes)

PRAIRIE FUNDS
(Exact Name of Registrant as
Specified in Charter)

c/o The First National Bank of Chicago
Three First National Plaza
Chicago, Illinois 60670 60670
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including
Area Code: (312) 732-4231

Bradford M. Markham, Esq.
Three First National Plaza
Chicago, Illinois 60670
(Name and Address of Agent for Service)

copy to:

Lewis G. Cole, Esq.
Stroock & Stroock & Lavan
7 Hanover Square
New York, New York 10004-2696

Approximate Date of Proposed Public Offering: As soon as
practicable after this Registration Statement is declared
effective.

<PAGE>

CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933
===============================================================
<TABLE>

<CAPTION>
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF AMOUNT OFFERING AGGREGATE AMOUNT OF
SECURITIES BEING PRICE PER OFFERING REGISTRATION
BEING REGISTERED REGISTERED UNIT PRICE FEE
<S> <C> <C> <C> <C>
Shares of Beneficial * * * $500.00
Interest, par value
$.001 per share

===========================================================================
</TABLE>

* Pursuant to Regulation 270.24f-2 under the Investment
Company Act of 1940, the Registrant hereby elects to
register an indefinite number of shares of its Common
Stock.

===============================================================
The Registrant hereby amends this registration
statement
on such date or dates as may be necessary to delay its
effective date until the Registrant shall file a
further
amendment which specifically states that this
registration statement shall thereafter become
effective
in accordance with Section 8(a) of the Securities Act
of
1933 or until the registration statement shall become
effective on such date as the Commission, acting
pursuant
to said Section 8(a), may determine.

===============================================================
==

<PAGE>
Cross-Reference Sheet Pursuant to Rule 495(a)
<TABLE>

ITEMS IN
PART A OF
FORM N-1A CAPTION PAGE
<S> <C> <C>
1 Cover Cover Page

2 Synopsis 5

3 Condensed Financial Information *

4 General Description of Registrant 12

5 Management of the Fund 42

5(a) Management's Discussion of Fund's
Performance *

6 Capital Stock and Other Securities 28, 49

7 Purchase of Securities Being Offered 29

8 Redemption or Repurchase 38

9 Pending Legal Proceedings *

ITEMS IN
PART B OF
FORM N-1A

10 Cover Page B-1

11 Table of Contents B-1

12 General Information and History *

13 Investment Objective and Policies B-2

14 Management of the Fund B-18

15 Control Persons and Principal Holders
of Securities B-18

16 Investment Advisory and Other Services B-18

17 Brokerage Allocation B-26

18 Capital Stock and Other Securities B-32

19 Purchase, Redemption and Pricing of
Securities Being Offered B-20, B-22, B-23

20 Tax Status B-27

21 Underwriters *

22 Performance Information B-30

23 Financial Statements B-32

ITEMS IN
PART C OF
FORM N-1A

24 Financial Statements and Exhibits C-1

25 Persons Controlled by or Under Common
Control with Registrant C-2

26 Number of Holders of Securities C-2

27 Indemnification C-2

28 Business and Other Connections of
Investment Adviser C-3

29 Principal Underwriters C-3

30 Location of Accounts and Records C-4

31 Management Services C-4

32 Undertakings C-4

- ---------
*Omitted since answer is negative or inapplicable.

</TABLE>

<PAGE>
PRAIRIE FUNDS
- --------------------------------------------------------------

PROSPECTUS - ____________, 1994

Prairie Funds (the "Trust") is an open-end,
management
investment company, known as a series fund. The Trust permits
investors to invest in any of 12 separate series (the "Funds"),
divided into five general fund types: Asset Allocation; Equity;
Bond; Municipal Bond; and Money Market.

- - ASSET ALLOCATION FUNDS--These Funds will follow an
asset
allocation strategy by investing in equity securities,
fixed-income securities and short-term instruments of
domestic and foreign issuers:

- The MANAGED ASSETS INCOME FUND seeks to maximize
current income; capital appreciation is a
secondary,
but nonetheless important, goal.

- The MANAGED ASSETS BALANCED FUND seeks to

maximize
total return, consisting of capital appreciation
and current income, without assuming undue risk.

- - EQUITY FUNDS--These Funds will invest principally in
equity
securities:

- The EQUITY INCOME FUND seeks to provide income;
capital
appreciation and growth of earnings are
secondary, but
nonetheless important, goals. This Fund will
invest
primarily in income-producing equity securities
of
domestic issuers.

- The GROWTH FUND seeks long-term capital
appreciation.
This Fund will invest primarily in equity
securities of
domestic issuers believed by the Fund's
investment
adviser to have above-average growth
characteristics.

- The SPECIAL OPPORTUNITIES FUND seeks long-term
capital
appreciation. This Fund will invest primarily
in
equity securities of small- to medium-sized
emerging
growth domestic issuers that the Fund's
investment
adviser believes are undervalued in the
marketplace.

- The INTERNATIONAL EQUITY FUND seeks long-term
capital
appreciation. This Fund will invest primarily
in
equity securities of foreign issuers.

- - BOND FUNDS--These Funds will invest principally in
fixed-
income securities:

- The BOND FUND seeks to provide as high a level
of
current income as is consistent with the
preservation
of capital. This Fund will invest in a
portfolio of
U.S. dollar denominated investment grade
fixed-income
securities of domestic and foreign issuers,
without
regard to maturity.

- The INTERNATIONAL BOND FUND seeks to maximize
investment return. This Fund will invest
primarily in
investment grade debt securities of foreign
issuers.

- - MUNICIPAL BOND FUND--This Fund will invest principally
in
Municipal Obligations:

- The INTERMEDIATE MUNICIPAL BOND FUND seeks to
provide
as high a level of current income exempt from
Federal
income tax as is consistent with the
preservation of
capital. This Fund will invest primarily in a
portfolio of investment grade Municipal
Obligations
which, under normal conditions, will have a
dollar-
weighted average maturity expected to range
between
three and ten years.

- - MONEY MARKET FUNDS--These Funds will invest in various
kinds of money market instruments and will seek a
stable
net asset value of $1.00 per share:

- The U.S. GOVERNMENT MONEY MARKET FUND seeks to
provide
as high a level of current income as is
consistent with
the preservation of capital and the maintenance
of
liquidity. This Fund will invest only in
short-term
securities issued or guaranteed as to principal
or
interest by the U.S. Government, its agencies
and
instrumentalities, and repurchase agreements in
respect
of such securities.

- The MONEY MARKET FUND seeks to provide as high a
level
of current income as is consistent with the
preservation of capital and the maintenance of
liquidity. This Fund will invest in short-term
money
market instruments.

- The MUNICIPAL MONEY MARKET FUND seeks to provide
as
high a level of current income exempt from
Federal
income tax as is consistent with the
preservation of
capital and the maintenance of liquidity. This
Fund
will invest in short-term Municipal Obligations.

First Chicago Investment Management Company
("FIMCO" or
the "Investment Adviser") will serve as each Fund's investment
adviser and administrator. The Investment Adviser has engaged
ANB Investment Management and Trust Company ("ANB-IMC") to serve
as sub-investment adviser to the International Equity Fund and to
provide day-to-day management of that Fund's investments.

Concord Financial Group, Inc. (the
"Distributor") will
serve as each Fund's distributor.

By this Prospectus, Class A shares of each Fund,
Class
B shares of each Fund other than the U.S. Government Money Market
and Municipal Money Market Funds, and Class I shares of each Fund
other than the Money Market Funds, are being offered.

Class A shares of each Fund, other than the Money
Market Funds, are subject to a sales charge imposed at the time
of purchase and Class B shares of each such Fund are subject to a
contingent deferred sales charge imposed on redemptions made
within up to six years of purchase. Class A and Class B shares
are offered to any investor. Each Fund offers these alternatives
to permit an investor to choose the method of purchasing shares
that is most beneficial given the amount of the purchase, the
length of time the investor expects to hold the shares and other
circumstances. Class B shares of the Money Market Fund may be
acquired only through the exchange of Class B shares of the other
Funds.

Class I shares are offered without a sales
charge and
are sold only to qualified trust and agency account clients of
FIMCO, The First National Bank of Chicago ("FNBC"), American
National Bank and Trust Company ("ANB") or their affiliates and
to certain qualified employee benefit plans or other programs.

Other differences between the Classes include
the
services offered to and expenses borne by each Class and certain
voting rights, as described herein.

Fund shares are not deposits or obligations of,
or
guaranteed by, any bank, and are not federally insured by the
Federal Deposit Insurance Corporation ("FDIC"), the Federal
Reserve Board, or any other agency. Fund shares involve certain
investment risks, including the possible loss of principal. For
all Funds other than the Money Market Funds, investors should
recognize that the share price, yield and investment return of
each Fund fluctuate and are not guaranteed.

For the Money Market Funds, investors should
recognize
that an investment in a Money Market Fund is neither insured nor
guaranteed by the U.S. Government. There can be no assurance
that the Money Market Funds will be able to maintain a stable net
asset value of $1.00 per share.

______________________

This Prospectus sets forth concisely information
about
the Trust and Funds that an investor should know before
investing. It should be read and retained for future reference.

Part B (also known as the Statement of
Additional
Information), dated ____________, 1994, which may be revised from
time to time, provides a further discussion of certain areas in
this Prospectus and other matters which may be of interest to
some investors. It has been filed with the Securities and
Exchange Commission and is incorporated herein by reference. For
a free copy, write to the Trust at
___________________________________________________ or call

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

________________________________________________________________

Table of Contents

Fee Table . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Highlights. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Description of the Funds. . . . . . . . . . . . . . . . . . . . .
Alternative Purchase Methods. . . . . . . . . . . . . . . . . . .
How to Buy Shares . . . . . . . . . . . . . . . . . . . . . . . .
Shareholder Services. . . . . . . . . . . . . . . . . . . . . . .
How to Redeem Shares. . . . . . . . . . . . . . . . . . . . . . .
Management of the Trust . . . . . . . . . . . . . . . . . . . . .
Distribution Plan and Shareholder Services Plan . . . . . . . . .
Dividends, Distributions and Taxes. . . . . . . . . . . . . . . .
Performance Information . . . . . . . . . . . . . . . . . . . . .
General Information . . . . . . . . . . . . . . . . . . . . . . .
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

<PAGE>

<TABLE>

FEE TABLE

<CAPTION>
CLASS A CLASS B CLASS I
INTERMEDIATE ALL INTERMEDIATE ALL OTHER ALL FUNDS
SHAREHOLDER MONEY MARKET MUNICIPAL OTHER MUNICIPAL FUNDS OFFERING OFFERING EXPENSES
TRANSACTION FUNDS BOND FUND FUNDS BOND FUND CLASS B CLASS I
<S> <C> <C> <C> <C> <C> <C>
Maximum Sales Charge
Imposed On Purchases
(as percentage of
offering price) None 3.00% 4.50% None None None

Sales Charge On
Reinvested Dividends None None None None None None

Maximum Deferred Sales
Charge Imposed On
Redemption (as a
percentage of the amount
subject to charge) None None* None* 3.00% 5.00% None

Redemption Fees None None None None None None

Exchange Fees None None None None None None

________________________
* A contingent deferred sales charge of up to 1.00% may be assessed on certain redemptions of Class A shares purchased without an
initial sales charge as part of an investment of $1 million or more.

</TABLE>

(Fee Table continued on next page)
<PAGE>

FEE TABLE
(continued)
<TABLE>

Annual Fund Operating Expenses
(as a percentage of average daily
net assets)
<CAPTION>
EXAMPLE
AN INVESTOR WOULD PAY THE
FOLLOWING EXPENSES ON A $1,000
INVESTMENT, ASSUMING (1) 5% ANNUAL
TOTAL RETURN AND (2) REDEMPTION AT
MANAGEMENT 12B-1 OTHER OPERATING THE END OF EACH TIME PERIOD:
CLASS A SHARES FEES FEES EXPENSES EXPENSES 1 YEAR 3 YEARS
<S> <C> <C> <C> <C> <C> <C>
Asset Allocation Funds:
Managed Assets Income Fund .65% none ___% ___% $___ $___
Managed Assets Balanced Fund .65% none ___%* ___%* $___ $___

Equity Funds:
Equity Income Fund .50% none ___% ___% $___ $___
Growth Fund .65% none ___% ___% $___ $___
Special Opportunities Fund .70% none ___% ___% $___ $___
International Equity Fund .80% none ___% ___% $___ $___

Bond Funds:
Bond Fund .55% none ___% ___% $___ $___
International Bond Fund .70% none ___%* ___%* $___ $___

Municipal Bond Fund:
Intermediate Municipal Bond Fund .40% none ___% ___% $___ $___

Money Market Funds:
U.S. Government Money Market Fund .55% none ___%* ___%* $___ $___
Money Market Fund .55% none ___%* ___%* $___ $___
Municipal Money Market Fund .55% none ___%* ___%* $___ $___

_______________________________________
* After expense reimbursements or fee waivers.
</TABLE>

(Fee Table continued on next page)
<PAGE>

FEE TABLE
(continued)

<TABLE>

Annual Fund Operating Expenses
(as a percentage of average daily
net assets)
<CAPTION>
EXAMPLE
AN INVESTOR WOULD PAY THE
FOLLOWING EXPENSES ON A $1,000
INVESTMENT, ASSUMING (1) 5% ANNUAL
TOTAL RETURN AND (2) REDEMPTION AT
MANAGEMENT 12B-1 OTHER OPERATING THE END OF EACH TIME PERIOD:
CLASS B SHARES FEES FEES EXPENSES EXPENSES 1 YEAR 3 YEARS
<S> <C> <C> <C> <C> <C> <C>
Asset Allocation Funds:
Managed Assets Income Fund .65% .75% ___% ___% $___ $___/$___**
Managed Assets Balanced Fund .65% .75% ___%* ___%* $___ $___/$___**

Equity Funds:
Equity Income Fund .50% .75% ___% ___% $___ $___/$___**
Growth Fund .65% .75% ___% ___% $___ $___/$___**
Special Opportunities Fund .70% .75% ___% ___% $___ $___/$___**
International Equity Fund .80% .75% ___% ___% $___ $___/$___**

Bond Funds:
Bond Fund .55% .75% ___% ___% $___ $___/$___**
International Bond Fund .70% .75% ___%* ___%* $___ $___/$___**

Municipal Bond Fund:
Intermediate Municipal Bond Fund .40% .50% ___% ___% $___ $___/$___**

Money Market Funds:
Money Market Fund .55% .75% ___% ___% $___ $___

___________________________

* After expense reimbursements or fee waivers.
** Assuming no redemption of Class B shares.

</TABLE>
(Fee Table continued on next page)

<PAGE>
FEE TABLE
(continued)

<TABLE>

Annual Fund Operating Expenses
(as a percentage of average daily
net assets)

<CAPTION>
EXAMPLE
AN INVESTOR WOULD PAY THE
FOLLOWING EXPENSES ON A $1,000
INVESTMENT, ASSUMING (1) 5% ANNUAL
TOTAL RETURN AND (2) REDEMPTION AT
MANAGEMENT 12B-1 OTHER OPERATING THE END OF EACH TIME PERIOD:
CLASS I SHARES FEES FEES EXPENSES* EXPENSES* 1 YEAR 3 YEARS
<S> <C> <C> <C> <C> <C> <C>
Asset Allocation Funds:
Managed Assets Balanced Fund .65% none ___% ___% $___ $___
Managed Assets Income Fund .65% none ___% ___% $___ $___

Bond Funds:
Bond Fund .55% none ___% ___% $___ $___
International Bond Fund .70% none ___% ___% $___ $___

Municipal Bond Fund:
Intermediate Municipal Bond Fund .40% none ___% ___% $___ $___

_____________________
* After expense reimbursements or fee waivers.
</TABLE>

- ---------------------------------------------------------------
THE AMOUNTS LISTED IN THE EXAMPLES SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE
GREATER OR LESS THAN THOSE INDICATED. MOREOVER, WHILE EACH
EXAMPLE ASSUMES A 5% ANNUAL RETURN, A FUND'S ACTUAL PERFORMANCE
WILL VARY AND MAY RESULT IN AN ACTUAL RETURN GREATER OR LESS
THAN 5%.
- ---------------------------------------------------------------

The purpose of the foregoing table is to assist
investors in understanding the various costs and expenses that
investors in a Fund will bear, directly or indirectly, the
payment of which will reduce investors' return on an annual
basis. Long-term investors in Class B shares of a Fund could
pay more in 12b-1 fees than the economic equivalent of paying a
front-end sales charge. Other Expenses and Total Operating
Expenses are based on estimated amounts for the current fiscal
year. Other Expenses and Total Operating Expenses noted above,
without expense reimbursements or fee waivers, would be
increased, with respect to Class A and Class B, by ____% for
the Managed Assets Balanced Fund, ____% for the International
Bond Fund, .__% for the U.S. Government Money Market Fund, .__%
for the Money Market Fund and .__% for the Municipal Money
Market Fund, and, with respect to Class I, by .__% for each of
the International Equity Fund and International Bond Fund and
.__% for each other Fund. With respect to each Fund, the
Investment Adviser has undertaken until such time as it gives
investors at least 60 days' notice to the contrary that if, in
any fiscal year, certain expenses of the Fund, including the
investment advisory fee, exceed the Total Operating Expenses
noted above in the table for such Fund, the Investment Adviser
may waive a portion of its investment advisory fee or bear
certain other expenses to the extent of such excess expense.
FIMCO, FNBC, ANB and their affiliates and certain Service
Agents (as defined below) may charge their clients direct fees
for effecting transactions in Fund shares; such fees are not
reflected in the foregoing table. See "How to Buy Shares,"
"Management of the Trust" and "Distribution Plan and
Shareholder Services Plan."
<PAGE>
HIGHLIGHTS

The following summary is qualified in its
entirety by
the more detailed information appearing elsewhere in this
Prospectus.

THE TRUST The Trust is an open-end, management investment
company, known as a series fund. The Trust currently has
established 12 series.

INVESTMENT OBJECTIVES AND MANAGEMENT POLICIES Each Fund's
investment objective is set forth on the cover page of this
Prospectus. The differences in objectives and policies among
the Funds determine the types of portfolio securities in which
each Fund invests and can be expected to affect the degree of
risk to which each Fund is subject and each Fund's yield or
return. The Funds' management policies are described on the
page of this Prospectus indicated below.

Name of Fund Page
Managed Assets Income Fund
Managed Assets Balanced Fund
Equity Income Fund
Growth Fund
Special Opportunities Fund
International Equity Fund
Bond Fund
International Bond Fund
Intermediate Municipal Bond Fund
U.S. Government Money Market Fund
Money Market Fund
Municipal Money Market Fund

INVESTMENT ADVISER AND ADMINISTRATOR First Chicago Investment
Management Company is each Fund's investment adviser and
administrator. The Trust has agreed to pay the Investment
Adviser an annual fee as set forth under "Management of the
Trust." The Investment Adviser has engaged ANB-IMC to serve as
sub-investment adviser to the International Equity Fund.

ALTERNATIVE PURCHASE METHODS Each Fund offers Class A shares;
each Fund, other than the U.S. Government Money Market and
Municipal Money Market Funds, offers Class B shares; and each
Fund, other than the Money Market Funds, offers Class I shares.
Each Class A, Class B and Class I share represents an identical
pro rata interest in the relevant Fund's investment portfolio.

Class A shares are sold at net asset value per
share
plus, for each Fund, other than the Money Market Funds, an
initial sales charge imposed at the time of purchase. The
initial sales charge may be reduced or waived for certain
purchases. See "How to Buy Shares--Class A Shares." Class A
shares of each Fund are subject to an annual service fee.

Class B shares are sold at net asset value per
share
with no initial sales charge at the time of purchase; as a
result, the entire purchase price is immediately invested in
the Fund. Class B shares are subject to a contingent deferred
sales charge ("CDSC"), which is assessed only if the Class B
shares are redeemed within six years (five years in the case of
Intermediate Municipal Bond Fund) of purchase. Class B shares
of the Money Market Fund may be acquired only through the
exchange of Class B shares of the other Funds and are subject
to the CDSC, if any, of the shares with which the exchange is
made. See "How to Redeem Shares--Contingent Deferred Sales
Charge--Class B Shares." Class B shares are subject to an
annual distribution fee and service fee. The distribution fee
paid by Class B will cause Class B to have a higher expense
ratio and to pay lower dividends than Class A. Approximately
eight years after the date of purchase, Class B shares
automatically will convert to Class A shares, based on the
relative net asset values for shares of each such Class, and
will no longer be subject to a distribution fee.

Class I shares are sold at net asset value with
no
sales charge. Class I shares are offered exclusively to
qualified trust and agency account clients of FNBC, ANB or
their affiliates ("Fiduciary Accounts") and qualified benefit
plans or other programs with assets in excess of $100 million
("Eligible Retirement Plans"). Class I shares held by
investors who after purchasing Class I shares terminate their
Fiduciary Accounts automatically will convert to Class A
shares, based on the relative net asset values for shares of
each such Class.

See "Alternative Purchase Methods."

<TABLE>

Historical Performance Information

Composite Performance for the
Predecessor Funds for Various Average Annual
Periods Ended September 30, 1994 Total Return

CLASS A SHARES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
ASSET ALLOCATION FUNDS:
Managed Assets Balanced Fund (1) N/A N/A N/A N/A
Managed Assets Income Fund (2)
EQUITY FUNDS:
Equity Income Fund (3)
Growth Fund (3)
Special Opportunities Fund (3)
International Equity Fund (1) N/A N/A N/A N/A
BOND FUNDS:
Bond Fund (3)
International Bond Fund (3)
MUNICIPAL BOND FUND:
Intermediate Municipal Bond Fund (2)
MONEY MARKET FUNDS:
U.S. Government Money Market Fund (2)
Money Market Fund (2)
Municipal Money Market Fund (2)

_______________________________________
<PAGE>

</TABLE>
<TABLE>

CLASS B SHARES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
ASSET ALLOCATION FUNDS:
Managed Assets Balanced Fund (1) N/A N/A N/A N/A
Managed Assets Income Fund (2)
EQUITY FUNDS:
Equity Income Fund (3)
Growth Fund (3)
Special Opportunities Fund (3)
International Equity Fund (1) N/A N/A N/A N/A
BOND FUNDS:
Bond Fund (3)
International Bond Fund (3)
MUNICIPAL BOND FUND:
Intermediate Municipal Bond Fund (2)
MONEY MARKET FUND:
Money Market Fund (2)

_______________________________________

<PAGE>

</TABLE>
<TABLE>

CLASS I SHARES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
ASSET ALLOCATION FUNDS:
Managed Assets Balanced Fund (1) N/A N/A N/A N/A
Managed Assets Income Fund (2)
EQUITY FUNDS:
Equity Income Fund (3)
Growth Fund (3)
Special Opportunities Fund (3)
International Equity Fund (1) N/A N/A N/A N/A
BOND FUNDS:
Bond Fund (3)
International Bond Fund (3)
MUNICIPAL BOND FUND:
Intermediate Municipal Bond Fund (2)
_______________________________________

(1) No predecessor exists; thus, no prior performance information is available.

(2) The Fund will commence operations through a transfer of assets from an investment company advised by FNBC, using substantially
the same investment objective, policies, restrictions and methodologies as the Fund. The predecessor funds are: for Managed
Assets Income Fund, First Prairie Diversified Asset Fund; for Intermediate Municipal Bond Fund, the Intermediate Series of
First Prairie Municipal Bond Fund; for U.S. Government Money Market Fund, the Government Series of First Prairie Money Market
Fund; for Money Market Fund, the Money Market Series of First Prairie Money Market Fund; and for Municipal Money Market Fund,
First Prairie Municipal Money Market Fund. The performance shown is that of the predecessor fund.

(3) The Fund will commence operations through a transfer of assets from a common trust fund managed by FNBC, using substantially
the same investment objective, policies, restrictions and methodologies as the Fund. The common trust fund did not charge any
expenses. The performance information reflects the operating expenses that are expected to be charged as more fully set forth
in the Fee Table above.

The historical pro-forma performance information presented above for each Fund is deemed relevant because the predecessor was
advised by FNBC which reorganized the personnel responsible for advising the predecessor into FIMCO, its wholly-owned subsidiary,
which will manage the Fund, using substantially the same investment objective, policies, restrictions and methodologies as those
used by the Fund. However, this performance information is not necessarily indicative of the future performance of any Fund.
Because each Fund will be actively managed, its investments will vary from time to time and will not be identical to the past
portfolio investments of the predecessor. Each Fund's performance will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.

HOW TO BUY SHARES Orders for the purchase of Class A and Class B shares may be placed through a number of institutions including
FIMCO, FNBC, ANB and their affiliates, including First Chicago Investment Services, Inc. ("FCIS"), a registered broker-dealer, the
Distributor and certain banks, securities dealers and other industry professionals such as investment advisers, accountants and
estate planning firms (collectively, "Service Agents").

Investors purchasing Class I shares through their Fiduciary Accounts at FNBC, ANB or their affiliates should
contact such
entity directly for appropriate instructions, as well as for information about conditions pertaining to the account and any related
fees. Class I shares may be purchased for a Fiduciary Account or Eligible Retirement Plan only by a custodian, trustee, investment
manager or other entity authorized to act on behalf of such Account or Plan.

The minimum initial investment is $1,000. All subsequent investments must be at least $100.

See "How to Buy Shares."

SHAREHOLDER SERVICES The Trust offers Fund shareholders certain services and privileges including: Exchange Privilege, Letter of
Intent and Automatic Investment Plan. Certain services and privileges may not be available through all Service Agents.

HOW TO REDEEM SHARES Generally, investors should contact their representatives at FIMCO, FNBC, ANB or appropriate Service Agent for
redemption instructions. Investors who are not clients of FIMCO, FNBC, ANB or a Service Agent may redeem Fund shares by written
request to the Trust's transfer agent.

See "How to Redeem Shares."

DESCRIPTION OF THE FUNDS

GENERAL

The Trust is a "series fund," which is a mutual fund divided into separate portfolios. Each portfolio is treated
as a
separate entity for certain matters under the Investment Company Act of 1940, as amended (the "1940 Act"), and for other purposes,
and a shareholder of one portfolio is not deemed to be a shareholder of any other portfolio. As described below, for certain
matters Trust shareholders vote together as a group; as to others they vote separately by portfolio. By this Prospectus, shares of
12 of the Trust's portfolios are being offered: five diversified portfolios (the "Diversified Funds")--Managed Assets Income Fund,
Managed Assets Balanced Fund, U.S. Government Money Market Fund, Money Market Fund and Municipal Money Market Fund--and seven non-
diversified portfolios (the "Non-Diversified Funds")--Equity Income Fund, Special Opportunities Fund, Growth Fund, International
Equity Fund, Bond Fund, International Bond Fund and Intermediate Municipal Bond Fund. From time to time, other portfolios may be
established and sold pursuant to other offering documents. See "General Information."

INVESTMENT OBJECTIVES

Each Fund's investment objective is set forth on the cover page of this Prospectus. The differences in objectives
and
policies among the Funds determine the types of portfolio securities in which each Fund invests and can be expected to affect the
degree of risk to which each Fund is subject and each Fund's yield or return. See "Management Policies" below, and "Appendix."
Each Fund's investment objective cannot be changed without approval by the holders of a majority (as defined in the 1940 Act) of
such Fund's outstanding voting securities. There can be no assurance that each Fund's investment objective will be achieved.

MANAGEMENT POLICIES

The following section should be read in conjunction with "Certain Portfolio Securities" and "Investment Techniques"
in the
Appendix.

ASSET ALLOCATION FUNDS--Each of the Managed Assets Income Fund and Managed Assets Balanced Fund will follow an asset allocation
strategy by investing in equity, fixed-income and short-term securities of domestic and foreign issuers. For each Asset Allocation
Fund, the asset classes, market sectors, securities and portfolio strategies selected will be those that the Investment Adviser
believes prudent and offer the greatest potential for achieving the relevant Asset Allocation Fund's investment objective. The
Investment Adviser has broad latitude in selecting investments and portfolio strategies.

The equity securities in which each Asset Allocation Fund may invest consist of common stocks, preferred stocks and
convertible securities, including those in the form of depositary receipts, as well as warrants to purchase such securities
(collectively, "Equity Securities"). The fixed-income securities in which each Asset Allocation Fund may invest include bonds and
debentures (including those that are convertible), notes, mortgage-related securities, asset-backed securities, municipal
obligations and convertible debt obligations (collectively, "Fixed-Income Securities"), with maturities of more than three years.
The short-term securities which may be purchased by an Asset Allocation Fund include fixed-income securities with maturities of less
than three years at the time of purchase, and money market instruments of the type in which the Money Market Fund invests
(collectively, "Money Market Instruments"), as described below.

Each Asset Allocation Fund's portfolio of debt securities will consist primarily of those which are rated no lower
than
Baa by Moody's Investors Service, Inc. ("Moody's") or BBB by Standard & Poor's Corporation ("S&P"), Fitch Investors Service, Inc.
("Fitch") or Duff & Phelps, Inc. ("Duff"), or, if unrated, deemed to be of comparable quality by the Investment Adviser. Debt
securities rated Baa by Moody's or BBB by S&P, Fitch or Duff are considered investment grade obligations which lack outstanding
investment characteristics and may have speculative characteristics as well. The Managed Assets Balanced Fund may invest up to 20%
of its net assets in debt securities rated below investment grade and the Managed Assets Income Fund may invest up to 5% of its net
assets in convertible bonds rated below investment grade. See "Risk Factors--Lower Rated Securities" below.
<PAGE>
The following table sets forth for each Asset Allocation Fund the asset classes, benchmark percentages and asset
class
strategy ranges within which the Investment Adviser intends to manage the Fund's assets:

</TABLE>
<TABLE>

MANAGED ASSETS MANAGED ASSETS
INCOME FUND BALANCED FUND
ASSET BENCHMARK STRATEGY BENCHMARK STRATEGY
CLASS PERCENTAGE RANGE PERCENTAGE RANGE
<S> <C> <C> <C> <C>
Equity 25% 5-45% 50% 30-70%
Fixed-Income 55% 35-75% 40% 25-60%
Short-Term 20% 0-40% 10% 0-30%
</TABLE>

"Benchmark percentage" represents the asset mix the
Investment Adviser would expect to maintain when its assessment
of economic conditions and investment opportunities indicate
that the financial markets are fairly valued relative to each
other. The asset class "strategy range" indicates ordinarily
expected variations from this benchmark and reflects the fact
that the Investment Adviser expects to make policy weight
shifts within specific asset classes. Under normal conditions,
the Investment Adviser expects to adhere to the asset class
strategy ranges set forth above; however, the Investment
Adviser reserves the right to vary, except as noted below, the
asset class mix and the percentage of securities invested in
any asset class or market from the benchmark percentages and
asset class strategy ranges set forth above as the risk/return
characteristics of either markets or asset classes, as assessed
by the Investment Adviser, vary over time. In any event, at
least 25% of the Managed Assets Balanced Fund's total assets
under normal market conditions will be invested in Fixed-Income
Securities. When the Investment Adviser determines that
adverse market conditions exist, each Asset Allocation Fund may
adopt a temporary defensive posture and invest its entire
portfolio in Money Market Instruments. Each Asset Allocation
Fund will invest in substantially the same securities within an
investment class. The amount of each Asset Allocation Fund's
aggregate assets invested in a particular investment class, and
thus in particular securities, will differ, but the relative
percentage that a particular security comprises within an
investment class ordinarily will remain substantially the same.
The asset allocation mix selected will be a primary determinant
in the respective Asset Allocation Fund's investment
performance.

Each Asset Allocation Fund also may engage in
futures
and options transactions and other derivative securities
transactions, such as interest rate and equity index swaps,
leveraging, short-selling, foreign exchange transactions and
lending portfolio securities, each of which involves risk. See
"Risk Factors" below and "Appendix--Investment Techniques."

EQUITY FUNDS--Each of the Equity Income Fund, Growth Fund,
Special Opportunities Fund and International Equity Fund (the
"Equity Funds") will invest at least 65% of the value of its
total assets (except when maintaining a temporary defensive
position) in Equity Securities, as defined under "Asset
Allocation Funds" above.

Each Equity Fund may invest, in anticipation of
otherwise investing cash positions, to meet asset segregation
or margin requirements or as otherwise noted below, in Money
Market Instruments. Under normal market conditions, no Equity
Fund expects to have a substantial portion of its assets
invested in Money Market Instruments. However, when the
Investment Adviser determines that adverse market conditions
exist, an Equity Fund may adopt a temporary defensive posture
and invest entirely in Money Market Instruments.

Each Equity Fund also may invest in Fixed-Income
Securities (as defined under "Asset Allocation Funds" above) to
the extent described below.

Each Equity Fund also may engage in futures and
options transactions and other derivative securities
transactions, such as equity index swaps, leveraging, short-
selling and lending portfolio securities, and, except for the
Equity Income Fund, may engage in foreign exchange
transactions, each of which involves risk. See "Risk Factors"
below and "Appendix--Investment Techniques."

- - The EQUITY INCOME FUND will invest primarily in income-
producing Equity Securities of domestic issuers. The
Investment Adviser will be particularly alert to
companies
which pay above-average dividends, yet offer
opportunities
for capital appreciation and growth of earnings. In
addition, the Fund may invest up to 35% of the value of
its net assets in convertible debt securities that
generally have features similar to both common stocks and
bonds and offer the potential for current income and
capital appreciation over time.

While the Fund will invest primarily in Equity Securities
of domestic issuers, the Fund also may invest in
depository receipts of foreign issuers. The Fund also
may
invest in Fixed-Income Securities and Money Market
Instruments based on the Investment Adviser's assessment
of economic conditions and investment opportunities. The
Fixed-Income Securities, other than convertible debt
securities, in which the Fund may invest must be rated
investment grade, or, if unrated, deemed to be of
comparable quality by the Investment Adviser. The
convertible debt securities in which the Fund may invest
may be rated lower than investment grade. See "Risk
Factors--Lower Rated Securities" below.

- - The GROWTH FUND will invest primarily in Equity
Securities
of domestic issuers believed by the Investment Adviser to
have above-average growth characteristics. The
Investment
Adviser will consider some of the following factors in
making its investment decisions: the development of new
or improved products or services, a favorable outlook for
growth in the industry, patterns of increasing sales and
earnings, the probability of increased operating
efficiencies, cyclical conditions, or other signs that
the
company is expected to show greater than average earnings
growth and capital appreciation.

While the Fund will invest primarily in Equity Securities
of domestic issuers, the Fund also may invest in
depository receipts of foreign issuers and may invest up
to 20% of its total assets (valued at the time of
investment) in Equity Securities of foreign issuers. The
Fund also may invest in Fixed-Income Securities which,
other than convertible debt securities, are rated
investment grade, or, if unrated, deemed to be of
comparable quality by the Investment Adviser. The Fund
may invest in convertible debt securities rated lower
than
investment grade. See "Risk Factors--Lower Rated
Securities" below.

- The SPECIAL OPPORTUNITIES FUND will invest
primarily
in Equity Securities of small- to medium-sized
emerging growth domestic issuers that the
Investment
Adviser believes are undervalued in the
marketplace.
The Investment Adviser will consider some of the
following factors in making its investment
decisions:
high quality management, significant equity
ownership
positions by management, a leading or dominant
position in a major product line, a sound
financial
position and a relatively high rate of return on
invested capital. The Fund also may invest in
companies that offer the possibility of
accelerating
earnings growth because of management changes,
new
products or structural changes in industry or
the
economy.

- - The INTERNATIONAL EQUITY FUND will invest in Equity
Securities of issuers located throughout the world,
except
the United States. As a neutral position, the Fund will
hold Equity Securities of issuers located in the
countries
which constitute the Morgan Stanley Capital
International-
Europe, Australia and Far East ("EAFE") Index. The EAFE
Index is a broadly diversified international index
composed of the Equity Securities of approximately 1,000
companies located outside the United States. Building on
this base, the Investment Adviser and ANB-IMC will shift
the Fund's holdings to emphasize or de-emphasize regions
of the international market based on such region's
relative attractiveness. In making these shifts, the
Investment Adviser and ANB-IMC will use a computer-based
model which takes into account a number of factors,
including relative economic strength, relative inflation
rates, relative valuation of equity markets, bond yield
differentials, forecasts of trade flows and financial
market volatility.

The Fund will seek to identify those countries offering
the greatest relative potential investment return, rather
than selecting individual companies in each country which
will outperform the major stock index of their respective
countries. Thus, the individual stocks selected will
generally be chosen through a statistical procedure to
approximate the investment performance of the relevant
country index. The Fund is not an index fund and is
neither sponsored by nor affiliated with Morgan Stanley
Capital International.

BOND FUNDS--Each of the Bond Fund and International Bond Fund
(the "Bond Funds") will invest at least 65% of the value of its
total assets (except when maintaining a temporary defensive
position) in bonds, debentures and other debt instruments.
Each Bond Fund will invest in Fixed-Income Securities. When
management believes it advisable for temporary defensive
purposes or in anticipation of otherwise investing cash
positions, each Bond Fund may invest in Money Market
Instruments.

Each Bond Fund also may engage in futures and
options
transactions and other derivative securities transactions, such
as interest rate swaps, leveraging, short-selling and lending
portfolio securities, and the International Bond Fund may
engage in foreign exchange transactions, each of which involves
risk. See "Risk Factors" below and "Appendix--Investment
Techniques."

- - The BOND FUND will invest in a broad range of U.S. dollar
denominated investment grade Fixed-Income Securities of
domestic and foreign issuers, without regard to maturity.

The Fund also may invest in Fixed-Income Securities
which,
while not rated, are determined by the Investment Adviser
to be of comparable quality to those rated securities in
which the Fund may invest.

- - The INTERNATIONAL BOND FUND will invest in Fixed-Income
Securities of issuers located throughout the world,
except
the United States. The Fund also may invest in
convertible preferred stocks. The Fund may hold foreign
currency, and may purchase debt securities or hold
currencies in combination with forward currency exchange
contracts. The Fund will be alert to opportunities to
profit from fluctuations in currency exchange rates. The
Fund will be particularly alert to favorable arbitrage
opportunities (such as those resulting from favorable
interest rate differentials) arising from the relative
yields of the various types of securities in which the
Fund may invest and market conditions generally. The
Fund
may invest without restriction in companies in, or
governments of, developing countries. Developing
countries have economic structures that are generally
less
diverse and mature, and political systems that are less
stable, than those of developed countries. The markets
of
developing countries may be more volatile than the
markets
of more mature economies; however, such markets may
provide higher rates of return to investors. See "Risk
Factors--Investing in Foreign Securities" below.

At least 65% of the value of
the Fund's
net assets will consist of Fixed-Income Securities which,
at the time of purchase, are rated at least investment
grade, or, if unrated, deemed to be of comparable quality
by the Investment Adviser. The Fund may invest up to 35%
of the value of its net assets in Fixed-Income Securities
rated lower than investment grade. See "Risk Factors--
Lower Rated Securities" below.

MUNICIPAL FUNDS--It is a fundamental policy of the Intermediate
Municipal Bond Fund (the "Municipal Bond Fund" and, together
with the Municipal Money Market Fund, the "Municipal Funds")
that it will invest (except when maintaining a temporary
defensive position) at least 80% of the value of its net assets
in Municipal Obligations and at least 65% of the value of its
total assets in bonds, debentures and other debt instruments.
Municipal Obligations in which the Municipal Funds will invest
are debt obligations issued by states, territories and
possessions of the United States and the District of Columbia
and their political subdivisions, agencies and
instrumentalities, or multi-state agencies or authorities, the
interest from which is, in the opinion of bond counsel to the
issuer, exempt from Federal income tax.

From time to time, each Municipal Fund may
invest
more than 25% of the value of its total assets in industrial
development bonds which, although issued by industrial
development authorities, may be backed only by the assets and
revenues of the non-governmental users. Interest on Municipal
Obligations (including certain industrial development bonds)
which are specified private activity bonds, as defined in the
Internal Revenue Code of 1986, as amended (the "Code"), issued
after August 7, 1986, while exempt from Federal income tax, is
a preference item for the purpose of the alternative minimum
tax. Where a regulated investment company receives such
interest, a proportionate share of any exempt-interest dividend
paid by the investment company may be treated as such a
preference item to the shareholder. Each Municipal Fund may
invest without limitation in such Municipal Obligations if the
Investment Adviser determines that their purchase is consistent
with the Fund's investment objective. See "Risk Factors--
Municipal Obligations" below.

From time to time, on a temporary basis other
than
for temporary defensive purposes (but not to exceed 20% of the
value of the Fund's net assets) or for temporary defensive
purposes, each Municipal Fund may invest in taxable Money
Market Instruments. Dividends paid by the Fund that are
attributable to income earned by it from these securities will
be taxable to investors. See "Dividends, Distributions and
Taxes." Under normal market conditions, the Trust anticipates
that not more than 5% of the value of a Municipal Fund's total
assets will be invested in any one category of these
securities.

- - The INTERMEDIATE MUNICIPAL BOND FUND will invest in a
portfolio of Municipal Obligations which, under normal
market conditions, will have a dollar-weighted average
maturity expected to range between three and ten years.
The Fund will purchase Municipal Obligations only if
rated
investment grade, or, if unrated, determined by the
Investment Adviser to be of the comparable quality to the
rated securities in which the Fund may invest. The Fund
also may engage in futures and options transactions and
lending portfolio securities, each of which involves
risk.
See "Risk Factors" below and "Appendix--Investment
Techniques."

MONEY MARKET FUNDS--Each of the U.S. Government Money Market
Fund, Money Market Fund and Municipal Money Market Fund (the
"Money Market Funds") seeks to maintain a net asset value of
$1.00 per share for purchases and redemptions. To do so, the
Trust uses the amortized cost method of valuing each Money
Market Fund's securities pursuant to Rule 2a-7 under the 1940
Act, certain requirements of which are summarized below.

In accordance with Rule 2a-7, each Money Market
Fund
is required to maintain a dollar-weighted average portfolio
maturity of 90 days or less, purchase only instruments having
remaining maturities of 13 months or less and invest only in
U.S. dollar denominated securities determined in accordance
with procedures established by the Board of Trustees to present
minimal credit risks and, in the case of the Money Market Fund
and Municipal Money Market Fund, which are rated in one of the
two highest rating categories for debt obligations by at least
two nationally recognized statistical rating organizations (or
one rating organization if the instrument was rated by only one
such organization) or, if unrated, are of comparable quality as
determined in accordance with procedures established by the
Board of Trustees. The nationally recognized statistical
rating organizations currently rating instruments of the type
the Money Market Fund and Municipal Money Market Fund may
purchase are Moody's, S&P, Duff, Fitch, IBCA Limited and IBCA
Inc., and Thomson BankWatch, Inc. and their rating criteria are
described in the Appendix to the Trust's Statement of
Additional Information. For further information regarding the
amortized cost method of valuing securities, see "Determination
of Net Asset Value" in the Trust's Statement of Additional
Information. There can be no assurance that each Money Market
Fund will be able to maintain a stable net asset value of $1.00
per share.

- - The U.S. GOVERNMENT MONEY MARKET FUND will invest only in
short-term securities issued or guaranteed as to
principal
or interest by the U.S. Government, its agencies or
instrumentalities and may enter into repurchase
agreements. The Fund also may lend securities from its
portfolio as described under "Appendix--Investment
Techniques."

- - The MONEY MARKET FUND will invest in short-term money
market obligations, including securities issued or
guaranteed by the U.S. Government or its agencies or
instrumentalities, certificates of deposit, time
deposits,
bankers' acceptances and other short-term obligations
issued by domestic banks, foreign branches of domestic
banks, foreign subsidiaries of domestic banks, domestic
and foreign branches of foreign banks and thrift
institutions, repurchase agreements, and high quality
domestic and foreign commercial paper and other
short-term
corporate obligations, including those with floating or
variable rates of interest. In addition, the Money
Market
Fund is permitted to lend portfolio securities and enter
into reverse repurchase agreements to the extent
described
under "Appendix--Investment Techniques." During normal
market conditions, at least 25% of the Fund's total
assets
will be invested in bank obligations.

The Fund will not invest more
than 5% of
its total assets in the securities (including the
securities collateralizing a repurchase agreement) of, or
subject to puts issued by, a single issuer, except that
(i) the Fund may invest more than 5% of its total assets
in a single issuer for a period of up to three business
days in certain limited circumstances, (ii) the Fund may
invest in obligations issued or guaranteed by the U.S.
Government without any such limitation, and (iii) the
limitation with respect to puts does not apply to
unconditional puts if no more than 10% of the Money
Market
Fund's total assets is invested in securities issued or
guaranteed by the issuer of the unconditional put.
Investments in rated securities not rated in the highest
category by at least two rating organizations (or one
rating organization if the instrument was rated by only
one such organization), and unrated securities not
determined by the Board of Trustees to be comparable to
those rated in the highest category, will be limited to
5%
of the Money Market Fund's total assets, with the
investment in any one such issuer being limited to no
more
than the greater of 1% of the Fund's total assets or
$1,000,000. As to each security, these percentages are
measured at the time the Money Market Fund purchases the
security.

- - The MUNICIPAL MONEY MARKET FUND will invest at least 80%
of the value of its net assets (except when maintaining a
temporary defensive position) in short-term Municipal
Obligations. Subject to the requirements of Rule 2a-7,
the Fund will engage in management policies that are
substantially identical to those of the Intermediate
Municipal Bond Fund. See "Appendix--Certain Portfolio
Securities--Municipal Obligations." The Fund also may
lend securities from its portfolio as described under
"Appendix--Investment Techniques."

CERTAIN FUNDAMENTAL POLICIES

Each Fund may (i) borrow money to the extent
permitted under the 1940 Act; and (ii) invest up to 25% of the
value of its total assets in the securities of issuers in a
single industry, provided there is no limitation on the
purchase of obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities or, in the case
of the Municipal Funds, Municipal Obligations. In addition,
(i) each of the Diversified Funds may invest up to 5% of its
total assets in the obligations of any one issuer, except that
up to 25% of the value of the Fund's total assets may be
invested (subject, in the case of the Money Market Funds, to
the provisions of Rule 2a-7), and obligations issued or
guaranteed by the U.S. Government, its agencies or
instrumentalities may be purchased, without regard to any such
limitation; and (ii) the Money Market Fund will invest, except
when it has adopted a temporary defensive position, at least
25% of its total assets in securities issued by banks,
including foreign banks and branches. This paragraph describes
fundamental policies that cannot be changed as to a Fund
without approval by the holders of a majority (as defined in
the 1940 Act) of such Fund's outstanding voting shares. See
"Investment Objectives and Management Policies--Investment
Restrictions" in the Trust's Statement of Additional
Information.

CERTAIN ADDITIONAL NON-FUNDAMENTAL POLICIES

Each Fund may (i) purchase securities of any
company
having less than three years' continuous operation (including
operations of any predecessors) if such purchase does not cause
the value of such Fund's investments in all such companies to
exceed 5% of the value of its total assets; (ii) pledge,
hypothecate, mortgage or otherwise encumber its assets, but
only to secure permitted borrowings; and (iii) invest up to 15%
(10% in the case of the Money Market Funds) of the value of its
net assets in repurchase agreements providing for settlement in
more than seven days after notice and in other illiquid
securities. See "Investment Objectives and Management Policies
- --Investment Restrictions" in the Trust's Statement of
Additional Information.

RISK FACTORS

GENERAL--Since each Fund will pursue different types of
investments, the risks of investing will vary depending on the
Fund selected for investment. Before selecting a Fund in which
to invest, the investor should assess the risks associated with
the types of investments made by the Fund. The net asset value
per share of each Fund, other than a Money Market Fund, is not
fixed and should be expected to fluctuate. Investors should
consider each Fund as a supplement to an overall investment
program and should invest only if they are willing to undertake
the risks involved.

INVESTMENT TECHNIQUES--Each Fund may engage in various
investment techniques to the extent described herein. The use
of investment techniques such as short-selling, engaging in
financial futures and options transactions, leverage through
borrowing, purchasing securities on a forward commitment basis,
and lending portfolio securities--techniques that are not
necessarily employed by each Fund--involves greater risk than
that incurred by many other funds with similar objectives that
do not engage in such techniques. See "Appendix--Investment
Techniques." Using these techniques may produce higher than
normal portfolio turnover and may affect the degree to which a
Fund's net asset value fluctuates. Higher portfolio turnover
rates are likely to result in comparatively greater brokerage
commissions. In addition, short-term gains realized from
portfolio transactions are taxable to shareholders as ordinary
gains.

A Fund's ability to engage in certain short-term
transactions may be limited by the requirement that, to qualify
as a regulated investment company, it must earn less than 30%
of its gross income from the disposition of securities held for
less than three months. This 30% test limits the extent to
which a Fund may sell securities held for less than three
months and invest in certain futures contracts, among other
strategies. However, portfolio turnover will not otherwise be
a limiting factor in making investment decisions. See
"Portfolio Transactions" in the Statement of Additional
Information.

EQUITY SECURITIES--(Asset Allocation and Equity Funds only)
Investors should be aware that Equity Securities fluctuate in
value, often based on factors unrelated to the value of the
issuer of the securities, and that fluctuations can be
pronounced. Changes in the value of a Fund's portfolio
securities will result in changes in the value of such Fund's
shares and thus the Fund's yield and total return to investors.

The securities of the smaller companies may
be
subject to more abrupt or erratic market movements than larger,
more-established companies, both because the securities
typically are traded in lower volume and because the issuers
typically are subject to a greater degree to changes in
earnings and prospects.

FIXED-INCOME SECURITIES--(Asset Allocation, Equity, Bond and
Municipal Bond Funds and, to a limited extent, each Money
Market Fund) Investors should be aware that even though
interest-bearing securities are investments which promise a
stable stream of income, the prices of such securities are
inversely affected by changes in interest rates and, therefore,
are subject to the risk of market price fluctuations. The
values of Fixed-Income Securities also may be affected by
changes in the credit rating or financial condition of the
issuing entities. Certain securities that may be purchased by
these Funds, such as those rated Baa by Moody's and BBB by S&P,
Fitch and Duff, may be subject to such risk with respect to the
issuing entity and to greater market fluctuations than certain
lower yielding, higher rated Fixed-Income Securities. See
"Lower Rated Securities" below and "Appendix--Certain Portfolio
Securities--Ratings" and Appendix in the Trust's Statement of
Additional Information.

LOWER RATED SECURITIES--(Asset Allocation, Equity Income,
Growth, Special Opportunities and International Bond Funds
only) Investors should carefully consider the relative risks of
investing in the higher yielding (and, therefore, higher risk)
debt securities in which each of the Managed Assets Balanced
Fund, Managed Assets Income Fund and International Bond Fund
may invest up to 20%, 5% and 35% of its net assets,
respectively, and convertible debt securities in which each of
the Equity Income, Growth and Special Opportunities Funds may
invest up to 35% of its net assets. The International Bond
Fund, Equity Income Fund, Growth Fund and Special Opportunities
Fund each intend to invest less than 35% of the value of its
net assets in such securities. These are securities such as
those rated Ba by Moody's or BB by S&P, Fitch or Duff or as low
as the lowest rating assigned by Moody's, S&P, Fitch or Duff.
They generally are not meant for short-term investing and may
be subject to certain risks with respect to the issuing entity
and to greater market fluctuations than certain lower yielding,
higher rated fixed-income securities. Securities rated Ba by
Moody's are judged to have speculative elements; their future
cannot be considered as well assured and often the protection
of interest and principal payments may be very moderate.
Securities rated BB by S&P, Fitch or Duff are regarded as
having predominantly speculative characteristics and, while
such obligations have less near-term vulnerability to default
than other speculative grade debt, they face major ongoing
uncertainties or exposure to adverse business, financial or
economic conditions which could lead to inadequate capacity to
meet timely interest and principal payments. Securities rated
C by Moody's are regarded as having extremely poor prospects of
ever attaining any real investment standing. Securities rated
D by S&P, Fitch and Duff are in default and the payment of
interest and/or repayment of principal is in arrears. Such
securities, though high yielding, are characterized by great
risk. See Appendix in the Trust's Statement of Additional
Information for a general description of securities ratings.
Although these ratings may be an initial criterion for
selection of portfolio investments, the Investment Adviser also
will evaluate these securities and the ability of the issuers
of such securities to pay interest and principal. The Fund's
ability to achieve its investment objectives may be more
dependent on the Investment Adviser's credit analysis than
might be the case for a fund that invested in higher rated
securities. See "Appendix--Certain Portfolio Securities--
Fixed-Income Securities--Ratings."

The market price and yield of securities
rated Ba
or lower by Moody's and BB or lower by S&P, Fitch or Duff are
more volatile than those of higher rated securities. Factors
adversely affecting the market price and yield of these
securities will adversely affect the Fund's net asset value.
In addition, the retail secondary market for these securities
may be less liquid than that of higher rated securities;
adverse conditions could make it difficult at times for the
Fund to sell certain securities or could result in lower prices
than those used in calculating such Fund's net asset value.

The market values of certain lower rated
debt
securities tend to reflect specific developments with respect
to the issuer to a greater extent than do higher rated
securities, which react primarily to fluctuations in the
general level of interest rates, and tend to be more sensitive
to economic conditions than are higher rated securities.
Issuers of such debt securities often are highly leveraged and
may not have available to them more traditional methods of
financing. Therefore, the risk associated with acquiring the
securities of such issuers generally is greater than is the
case with higher rated securities.

MUNICIPAL OBLIGATIONS--(Municipal Funds only) Certain
provisions in the Code relating to the issuance of Municipal
Obligations may reduce the volume of Municipal Obligations
qualifying for Federal tax exemption. One effect of these
provisions could be to increase the cost of the Municipal
Obligations available for purchase by the Municipal Funds and
thus reduce the available yield. Shareholders of the Municipal
Funds should consult their tax advisers concerning the effect
of these provisions on an investment in the Fund. Proposals
that may restrict or eliminate the income tax exemption for
interest on Municipal Obligations may be introduced in the
future. If any such proposal were enacted that would reduce
the availability of Municipal Obligations for investment by any
of these Funds so as to adversely affect its shareholders, the
Trust would reevaluate the affected Fund's investment objective
and policies and submit possible changes in the Fund's
structure to shareholders for their consideration. If
legislation were enacted that would treat a type of Municipal
Obligation as taxable, the Trust would treat such security as a
permissible taxable investment within the applicable limits set
forth herein.

Each Municipal Fund may invest more than 25%
of the
value of its total assets in Municipal Obligations which are
related in such a way that an economic, business or political
development or change affecting one such security also would
affect the other securities; for example, securities the
interest upon which is paid from revenues of similar types of
projects, or securities of issuers that are located in the same
state. As a result, each Municipal Fund may be subject to
greater risk as compared to a fund that does not follow this
practice.

Certain municipal lease/purchase obligations
in
which the Municipal Funds may invest may contain "non-
appropriation" clauses which provide that the municipality has
no obligation to make lease payments in future years unless
money is appropriated for such purpose on a yearly basis.
Although "non-appropriation" lease/purchase obligations are
secured by the leased property, disposition of the leased
property in the event of foreclosure might prove difficult. In
evaluating the credit quality of a municipal lease/purchase
obligation that is unrated, the Investment Adviser will
consider, on an ongoing basis, a number of factors including
the likelihood that the issuing municipality will discontinue
appropriating funding for the leased property.

FOREIGN SECURITIES--(Asset Allocation, Growth, Special
Opportunities, International Equity and International Bond
Funds and, to a limited extent, Equity Income and Money Market
Funds only) Foreign securities markets generally are not as
developed or efficient as those in the United States.
Securities of some foreign issuers are less liquid and more
volatile than securities of comparable U.S. issuers.
Similarly, volume and liquidity in most foreign securities
markets are less than in the United States and, at times,
volatility of price can be greater than in the United States.
In addition, there may be less publicly available information
about a non-U.S. issuer, and non-U.S. issuers generally are not
subject to uniform accounting and financial reporting
standards, practices and requirements comparable to those
applicable to U.S. issuers. See "Appendix--Certain Portfolio
Securities--Taxable Money Market Securities--Bank Obligations."

Because evidences of ownership of such
securities
usually are held outside the United States, each of these Funds
will be subject to additional risks which include possible
adverse political and economic developments, possible seizure
or nationalization of foreign deposits and possible adoption of
governmental restrictions which might adversely affect the
payment of principal and interest on the foreign securities or
might restrict the payment of principal and interest to
investors located outside the country of the issuers, whether
from currency blockage or otherwise. Custodial expenses for a
portfolio of non-U.S. securities generally are higher than for
a portfolio of U.S. securities.

Since foreign securities often are purchased
with
and payable in currencies of foreign countries, the value of
these assets as measured in U.S. dollars may be affected
favorably or unfavorably by changes in currency rates and
exchange control regulations. Some currency exchange costs
generally will be incurred when a Fund changes investments from
one country to another.

Furthermore, some of these securities may be
subject to brokerage or stamp taxes levied by foreign
governments, which have the effect of increasing the cost of
such investment and reducing the realized gain or increasing
the realized loss on such securities at the time of sale.
Income received by a Fund from sources within foreign countries
may be reduced by withholding and other taxes imposed by such
countries. Tax conventions between certain countries and the
United States, however, may reduce or eliminate such taxes.
All such taxes paid by a Fund will reduce its net income
available for distribution to its shareholders.

FOREIGN CURRENCY EXCHANGE--(Asset Allocation, Growth, Special
Opportunities, International Equity and International Bond
Funds only) Currency exchange rates may fluctuate significantly
over short periods of time. They generally are determined by
the forces of supply and demand in the foreign exchange markets
and the relative merits of investments in different countries,
actual or perceived changes in interest rates and other complex
factors, as seen from an international perspective. Currency
exchange rates also can be affected unpredictably by
intervention by U.S. or foreign governments or central banks,
or the failure to intervene, or by currency controls or
political developments in the United States or abroad.

The foreign currency market offers less
protection
against defaults in the forward trading of currencies than is
available when trading in currencies occurs on an exchange.
Since a forward currency contract is not guaranteed by an
exchange or clearinghouse, a default on the contract would
deprive the Fund of unrealized profits or force such Fund to
cover its commitments for purchase or resale, if any, at the
current market price.

FOREIGN COMMODITY TRANSACTIONS--(Asset Allocation, Growth,
Special Opportunities, International Equity and International
Bond Funds only) Unlike trading on domestic commodity
exchanges, trading on foreign commodity exchanges is not
regulated by the Commodity Futures Trading Commission (the
"CFTC") and may be subject to greater risks than trading on
domestic exchanges. For example, some foreign exchanges are
principal markets so that no common clearing facility exists
and an investor may look only to the broker for performance of
the contract. In addition, any profits that the Fund might
realize in trading could be eliminated by adverse changes in
the exchange rate, or such Fund could incur losses as a result
of those changes. Transactions on foreign exchanges may
include both commodities which are traded on domestic exchanges
and those which are not.

MORTGAGE-RELATED SECURITIES--(Asset Allocation, Equity and Bond
Funds only) No assurance can be given as to the liquidity of
the market for certain mortgage-backed securities, such as
collateralized mortgage obligations and stripped mortgage-
backed securities. Determination as to the liquidity of
interest-only and principal-only fixed mortgage-backed
securities issued by the U.S. Government or its agencies and
instrumentalities will be made in accordance with guidelines
established by the Trust's Board of Trustees. In accordance
with such guidelines, the Investment Adviser will monitor
investments in such securities with particular regard to
trading activity, availability of reliable price information
and other relevant information. The Trust intends to treat
other stripped mortgage-backed securities as illiquid
securities. See "Appendix--Certain Portfolio Securities--
Fixed-Income Securities--Mortgage-Related Securities" and "--
Illiquid Securities."

ZERO COUPON SECURITIES--(Asset Allocation, Equity, Bond and
Municipal Bond Funds only) Federal income tax law requires the
holder of a zero coupon security or of certain pay-in-kind
bonds to accrue income with respect to these securities prior
to the receipt of cash payments. To maintain its qualification
as a regulated investment company and avoid liability for
Federal income taxes, each Fund that invests in such securities
may be required to distribute such income accrued with respect
to these securities and may have to dispose of portfolio
securities under disadvantageous circumstances in order to
generate cash to satisfy these distribution requirements.

OTHER INVESTMENT CONSIDERATIONS--The classification of each
Non-Diversified Fund as a "non-diversified" investment company
means that the proportion of such Fund's assets that may be
invested in the securities of a single issuer is not limited by
the 1940 Act. A "diversified" investment company is required
by the 1940 Act generally, with respect to 75% of its total
assets, to invest not more than 5% of such assets in the
securities of a single issuer and to hold not more than 10% of
the voting securities of any single issuer. However, each Fund
intends to conduct its operations so as to qualify as a
"regulated investment company" for purposes of the Code, which
requires that, at the end of each quarter of its taxable year,
(i) at least 50% of the market value of its total assets be
invested in cash, U.S. Government securities, the securities of
other regulated investment companies and other securities, with
such other securities of any one issuer limited for the
purposes of this calculation to an amount not greater than 5%
of the value of each such Fund's total assets and (ii) not more
than 25% of the value of its total assets be invested in the
securities of any one issuer (other than U.S. Government
securities or the securities of other regulated investment
companies). Since a relatively high percentage of each Non-
Diversified Fund's assets may be invested in the securities of
a limited number of issuers, some of which may be within the
same industry or economic sector, its portfolio securities may
be more susceptible to any single economic, political or
regulatory occurrence than the portfolio securities of a
diversified investment company.

Investment decisions for each Fund are made
independently from those of the other investment companies or
investment advisory accounts that may be advised by the
Investment Adviser. However, if such other investment
companies or managed accounts are prepared to invest in, or
desire to dispose of, securities in which a Fund invests at the
same time as the Fund, available investments or opportunities
for sales will be allocated equitably to each of them. In some
cases, this procedure may adversely affect the size of the
position obtained for or disposed of by a Fund or the price
paid or received by a Fund.

ALTERNATIVE PURCHASE
METHODS

The Trust offers investors three methods of
purchasing Fund shares. Orders for purchases of Class I
shares, however, may be placed only for certain eligible
investors as described below. An investor who is not eligible
to purchase Class I shares may choose from Class A and Class B
the Class of shares that best suits the investor's needs, given
the amount of purchase, the length of time the investor expects
to hold the shares and any other relevant circumstances. Each
Class A, Class B and Class I share represents an identical pro
rata interest in a Fund's investment portfolio.

Class A shares are sold at net asset value
per
share plus, for each Fund other than a Money Market Fund, a
maximum initial sales charge of 4.50% (3.00% in the case of the
Intermediate Municipal Bond Fund) of the public offering price
imposed at the time of purchase. The initial sales charge may
be reduced or waived for certain purchases. See "How to Buy
Shares--Class A Shares." Class A shares of each Fund are
subject to an annual service fee at the rate of up to .25% of
the value of the average daily net assets of Class A. See
"Distribution Plan and Shareholder Services Plan."

Class B shares are sold at net asset value
per
share with no initial sales charge at the time of purchase; as
a result, the entire purchase price is immediately invested in
the Fund. Class B shares are subject to a maximum 5.00% (3.00%
in the case of the Intermediate Municipal Bond Fund) CDSC,
which is assessed only if Class B shares are redeemed within
six years (five years in the case of the Intermediate Municipal
Bond Fund) of purchase. Class B shares of the Money Market
Fund may be acquired only through exchanges with Class B shares
of the other Funds and are subject to the CDSC, if any, of the
shares with which the exchange is made. See "How to Buy
Shares--Class B Shares" and "How to Redeem Shares--Contingent
Deferred Sales Charge--Class B Shares." These shares are
subject to an annual service fee and distribution fee. See
"Distribution Plan and Shareholder Services Plan."
Approximately eight years after the date of purchase, Class B
shares automatically will convert to Class A shares, based on
the relative net asset values for shares of each Class, and
will no longer be subject to the distribution fee. Class B
shares that have been acquired through the reinvestment of
dividends and distributions will be converted on a pro rata
basis together with other Class B shares, in the proportion
that a shareholder's Class B shares converting to Class A
shares bears to the total Class B shares not acquired through
the reinvestment of dividends and distributions.

Class I shares are sold at net asset value
with no
sales charge. Class I shares are sold exclusively to qualified
trust and agency account clients of FNBC, ANB or their
affiliates ("Fiduciary Accounts") and to qualified benefit
plans or other programs with assets in excess of $100 million
("Eligible Retirement Plans"). Class I shares are not subject
to an annual service fee or distribution fee. Class I shares
held by investors who after purchasing Class I shares for their
Fiduciary Accounts terminate such Accounts automatically will
convert to Class A shares, based on the relative net asset
values for shares of each such Class.

Class B shares will receive lower per share
dividends and at any given time the performance of Class B
should be expected to be lower than for shares of each other
Class because of the higher expenses borne by Class B.
Similarly, Class A shares will receive lower per share
dividends and the performance of Class A should be expected to
be lower than Class I shares because of the higher expenses
borne by Class A. See "Fee Table."

An investor who is not eligible to purchase
Class I
shares should consider whether, during the anticipated life of
the investor's investment in the Fund, the accumulated
distribution fee and CDSC on Class B shares prior to conversion
would be less than the initial sales charge, if any, on Class A
shares purchased at the same time, and to what extent, if any,
such differential would be offset by the return of Class A.
Additionally, investors qualifying for reduced initial sales
charges who expect to maintain their investment for an extended
period of time might consider purchasing Class A shares because
the accumulated continuing distribution fees on Class B shares
may exceed the initial sales charge on Class A shares during
the life of the investment. Generally, Class A shares may be
more appropriate for investors who invest $_________ or more in
Fund shares.

HOW TO BUY SHARES

INFORMATION APPLICABLE TO ALL PURCHASERS

When purchasing Fund shares, an investor
must
specify the Class of shares being purchased. If no Class of
shares is specified, Class A shares will be purchased.

Class A and Class B shares are offered to
the
general public and may be purchased through a number of
institutions, including FIMCO, FNBC, ANB and their affiliates,
other Service Agents, and directly through the Distributor.
Class B shares of the Money Market Fund may be acquired only
through the exchange of Class B shares of the other Funds.

Orders for purchases of Class I shares may
be
placed only for clients of FNBC, ANB or their affiliates for
their Fiduciary Accounts maintained at FNBC, ANB or one of
their affiliates and Eligible Retirement Plans with assets in
excess of $100 million. Class I shares may be purchased for a
Fiduciary Account or Eligible Retirement Plan only by a
custodian, trustee, investment manager or other entity
authorized to act on behalf of such Account or Plan.

Share certificates will not be issued. It
is not
recommended that the Municipal Funds be used as a vehicle for
Keogh, IRA or other qualified retirement plans. The Trust
reserves the right to reject any purchase order.

The minimum initial investment for each
Class is
$1,000. However, for IRAs and other retirement plans, the
minimum initial purchase is $250. All subsequent investments
must be at least $100. The initial investment must be
accompanied by the Account Application. FIMCO and Service
Agents may impose initial or subsequent investment minimums
which are higher or lower than those specified above and may
impose different minimums for different types of accounts or
purchase arrangements.

As to each Fund, net asset value per share
of each
Class is computed by dividing the value of the Fund's net
assets represented by such Class (i.e., the value of its assets
less liabilities) by the total number of shares of such Class
outstanding. See "Determination of Net Asset Value" in the
Trust's Statement of Additional Information.

Each Money Market Fund's net asset value per
share
is determined as of 12:00 Noon, New York time, on each business
day (which, as used herein, shall include each day the New York
Stock Exchange is open for business, except Martin Luther King,
Jr. Day, Columbus Day and Veterans Day).

Shares of each Money Market Fund are sold on
a
continuous basis at the net asset value per share next
determined after an order in proper form and Federal Funds
(moneys of member banks within the Federal Reserve System which
are held on deposit at a Federal Reserve Bank) are received by
the Transfer Agent. If an investor does not remit Federal
Funds, his payment must be converted into Federal Funds. This
usually occurs within one business day of receipt of a bank
wire and within two business days of receipt of a check drawn
on a member bank of the Federal Reserve System. Checks drawn
on banks which are not members of the Federal Reserve System
may take considerably longer to convert into Federal Funds.
Prior to receipt of Federal Funds, the investor's money will
not be invested.

For each Fund, other than the Money Market
Funds,
shares are sold on a continuous basis at the public offering
price (i.e., net asset value plus the applicable sales load, if
any, set forth below). Net asset value per share of these
Funds is determined as of the close of trading on the floor of
the New York Stock Exchange (currently 4:00 p.m., New York
time), on each business day. For purposes of determining net
asset value per share, options and futures contracts will be
valued 15 minutes after the close of trading on the New York
Stock Exchange. Each of these Funds' investments are valued
each business day by one or more independent pricing services
approved by the Board of Trustees and are valued at fair value
as determined by the pricing service. Each pricing services'
procedures are reviewed under the general supervision of the
Board of Trustees.

For each Fund, other than the Money Market
Funds,
if an order is received by the Transfer Agent by the close of
trading on the floor of the New York Stock Exchange (currently
4:00 p.m., New York time) on any business day, shares will be
purchased at the public offering price determined as of the
close of trading on the floor of the New York Stock Exchange on
that day. Otherwise, shares will be purchased at the public
offering price determined as of the close of trading on the
floor of the New York Stock Exchange on the next business day.

Federal regulations require that an investor
provide a certified Taxpayer Identification Number ("TIN") upon
opening or reopening an account. See "Dividends, Distributions
and Taxes" and the Account Application for further information
concerning this requirement. Failure to furnish a certified
TIN to the Trust could subject an investor to a $50 penalty
imposed by the Internal Revenue Service (the "IRS").

CLASS A SHARES The public offering price for Class A shares of
each Fund, other than the Money Market Funds, is the net asset
value per share of that Class plus a sales load as shown below:

<TABLE>

ASSET ALLOCATION, EQUITY AND BOND FUNDS
TOTAL SALES LOAD

As a % of As a % of Dealers' Reallowance
AMOUNT OF TRANSACTION offering price net asset value as a % of
per share per share offering price
<S> <C> <C> <C>
Less than $50,000 4.50 4.70 4.00
$50,000 to less than $100,000 4.00 4.20 3.50
$100,000 to less than $250,000 3.00 3.10 2.50
$250,000 to less than $500,000 2.00 2.00 1.50
$500,000 to less than $1,000,000 1.50 1.50 1.25
$1,000,000 and above none none none

</TABLE>

<TABLE>

INTERMEDIATE MUNICIPAL BOND FUND
TOTAL SALES LOAD
<CAPTION>

As a % of As a % of Dealers' Reallowance
AMOUNT OF TRANSACTION offering price net asset value as a % of
per share per share offering price
<S> <C> <C> <C>
Less than $50,000 3.00 3.10 2.75
$50,000 to less than $100,000 2.50 2.60 2.25
$100,000 to less than $250,000 2.00 2.00 1.75
$250,000 to less than $500,000 1.50 1.50 1.25
$500,000 to less than $1,000,000 1.00 1.00 0.75
$1,000,000 and above none none none
</TABLE>

There is no initial sales charge on
purchases of
$1,000,000 or more of Class A shares. However, if an investor
purchases Class A shares without an initial sales charge as part
of an investment of at least $1,000,000 and redeems those shares
within a certain period after purchase, a CDSC will be imposed at
the time of redemption as described below. The terms contained
in the section of the Fund's Prospectus entitled "How to Redeem
Fund Shares--Contingent Deferred Sales Charge--Class B" (other
than the amount of the CDSC and its time periods) are applicable
to the Class A shares subject to a CDSC. Letter of Intent and
Right of Accumulation apply to such purchases of Class A shares.
The following table sets forth the rates of such CDSC for the
indicated time periods:

<TABLE>

AMOUNT OF CDSC AS A % OF
TRANSACTIONS AMOUNT INVESTED OR YEAR SINCE PURCHASE
AT OFFERING PRICE REDEMPTION PROCEEDS PAYMENT WAS MADE
<S> <C> <C>
$1,000,000 to less
than $2,500,000 1.00% First or Second

$2,500,000 to less
than $5,000,000 0.50% First

$5,000,000 and above 0.25% First
</TABLE>

The dealer reallowance may be changed from time
to time
but will remain the same for all dealers. With respect to
purchases of $1,000,000 or more of Class A shares made through
Service Agents (other than FIMCO, FNBC, ANB or their affiliates),
the Distributor may pay such Service Agents from its own funds a
fee of up to .75% for Intermediate Municipal Bond Fund and 1.00%
for each other Fund of the amount invested to compensate such
Service Agents for their distribution assistance in connection
with such purchases.

Full-time employees of NASD member firms and
full time
employees of other financial institutions which have entered into
an agreement with the Distributor pertaining to the sale of Fund
shares (or which otherwise have a brokerage-related or clearing
arrangement with an NASD member firm or other financial
institution with respect to sales of Fund shares), their spouses
and minor children, and accounts opened by a bank, trust company
or thrift institution, acting as a fiduciary or custodian, may
purchase Class A shares for themselves or itself, as the case may
be, at net asset value, provided that they have furnished the
Distributor appropriate notification of such status at the time
of the investment and such other information as it may request
from time to time in order to verify eligibility for this
privilege. This privilege also applies to full-time employees of
financial institutions affiliated with NASD member firms whose
employees are eligible to purchase Class A shares at net asset
value. In addition, Class A shares may be purchased at net asset
value for accounts registered under the Uniform Gifts to Minors
Act or Uniform Transfers to Minors Act which are opened through
FCIS. Class A shares also may be purchased at net asset value on
behalf of clients of FNBC, ANB or their affiliates for their
custody accounts. Class A shares are also offered at net asset
value to directors and full-time or part-time employees of First
Chicago Corporation, or any of its affiliates and subsidiaries,
retired employees of First Chicago Corporation, or any of its
affiliates and subsidiaries, Board members of a fund advised by
the Investment Adviser, including members of the Trust's Board,
or the spouse or minor child of any of the foregoing.

Class A shares may be purchased at net asset
value
through certain broker-dealers, registered investment advisers
and other financial institutions which have entered into an
agreement with the Distributor, which includes a requirement that
such shares be sold for the benefit of clients participating in a
"wrap account" or a similar program under which such clients pay
a fee to such broker-dealer, registered investment advisers or
other financial institution.

Class A shares also may be purchased at net
asset
value, without a sales charge, with the proceeds from the
redemption of shares of an investment company sold with a sales
charge or commission and not distributed by the Distributor.
(This does not include shares of a mutual fund which were or
would be subject to a contingent deferred sales charge upon
redemption.) The purchase must be made within 60 days of the
redemption, and the Distributor must be notified by the investor
in writing, or by the investor's investment professional, at the
time the purchase is made. The Distributor will offer to pay
dealers an amount equal to .___% of the net asset value of shares
purchased by the dealers' clients or customers in this manner.
If an investor purchasing shares in this manner redeems those
shares within one year after purchase, a ___% CDSC will be
imposed at the time of redemption.

Class A shares also will be offered at net asset
value
without a sales load to employees participating in qualified or
nonqualified employee benefit plans or other programs where
(i) the employers or affiliated employers maintaining such plans
or programs have a minimum of 250 employees eligible for
participation in such plans or programs or (ii) such plan's or
program's aggregate investment in the Trust and certain other
funds advised by the Investment Adviser exceeds one million
dollars ("Eligible Benefit Plans"). The determination of the
number of employees eligible for participation in such a plan or
program shall be made on the date that the Class A shares are
first purchased by or on behalf of employees participating in
such plan or program and on each subsequent January 1st.

CLASS B SHARES The public offering price for Class B shares is
the net asset value per share of that Class. No initial sales
charge is imposed at the time of purchase. A CDSC is imposed,
however, on certain redemptions of Class B shares, as described
under "How to Redeem Shares." The Distributor may compensate
certain Service Agents for selling Class B shares at the time of
purchase from its own assets. Proceeds of the CDSC and
distribution fees payable to the Distributor, in part, would be
used to defray these expenses.

CLASS I SHARES The public offering price for Class I shares is
the net asset value per share of that Class. No sales charge is
imposed for Class I shares.

PURCHASING SHARES THROUGH ACCOUNTS WITH FIMCO, FNBC, ANB OR A
SERVICING AGENT Investors who desire to purchase shares through
their accounts at FIMCO, FNBC, ANB or their affiliates or a
Service Agent should contact such entity directly for appropriate
instructions, as well as for information about conditions
pertaining to the account and any related fees. Service Agents,
FIMCO, FNBC and ANB may charge clients direct fees for effecting
transactions in shares, as well as fees for other services
provided to clients in connection with accounts through which
shares are purchased. These fees, if any, would be in addition
to fees received by a Service Agent under a Shareholder Services
Plan or Service Plan or fees received by FIMCO under the
Investment Advisory Agreement or Administration Agreement. Each
Service Agent has agreed to transmit to its clients a schedule of
such fees. In addition, Service Agents, FIMCO, FNBC and ANB may
receive different levels of compensation for selling different
Classes of shares and may impose minimum account and other
conditions, including conditions which might affect the
availability of certain shareholder privileges described in this
Prospectus. Certain investor accounts with FNBC, ANB and their
affiliates and certain Service Agents may be eligible for an
automatic investment privilege, commonly called a "sweep," under
which amounts in excess of a certain minimum held in these
accounts will be invested automatically in shares at
predetermined intervals. Each investor desiring to use this
privilege should consult FNBC, ANB or his Service Agent for
details. It is the responsibility of FNBC, ANB and Service
Agents to transmit orders on a timely basis.

Copies of the Trust's Prospectus and Statement
of
Additional Information may be obtained from the Distributor,
FIMCO, certain affiliates of FIMCO or certain Service Agents, as
well as from the Trust.

RIGHT OF ACCUMULATION--CLASS A SHARES Reduced sales loads apply
to any purchase of Class A shares where the dollar amount of
shares being purchased, plus the value of shares of such Fund,
shares of other Funds of the Trust, and shares of certain other
investment companies advised by the Investment Adviser purchased
with a sales load or acquired by a previous exchange of shares
purchased with a sales load (hereinafter referred to as "Eligible
Funds") held by an investor and any related "purchaser" as
defined in the Statement of Additional Information, is $50,000 or
more. If, for example, an investor previously purchased and
still holds Class A shares of the Equity Income Fund, or of any
other Eligible Fund or combination thereof, with an aggregate
current market value of $40,000 and subsequently purchases Class
A shares of such Fund or an Eligible Fund having a current value
of $20,000, the sales load applicable to the subsequent purchase
would be reduced to 4.00% of the offering price (4.20% of the net
asset value). All present holdings of Eligible Funds may be
combined to determine the current offering price of the aggregate
investment in ascertaining the sales load applicable to each
subsequent purchase.

To qualify for reduced sales loads, at the time
of a
purchase an investor or his Service Agent must notify the
Distributor if orders are made by wire, or the Transfer Agent if
orders are made by mail. The reduced sales load is subject to
confirmation of the investor's holdings through a check of
appropriate records.

SHAREHOLDER SERVICES

The Exchange Privilege and Automatic Investment
Plan
are available to shareholders of any class. The Letter of Intent
and Reinstatement Privilege are available only for Class A and
Class B shareholders, respectively. In addition, such services
and privileges may not be available to clients of certain Service
Agents and some Service Agents may impose certain conditions on
their clients which are different from those described in this
Prospectus. Each investor should consult his Service Agent in
this regard.

EXCHANGE PRIVILEGE. The Exchange Privilege enables an investor
to purchase, in exchange for shares of a Fund, shares of the same
Class of the other Funds. This privilege may be expanded to
permit exchanges between a Fund and other funds that, in the
future, may be advised by the Investment Adviser.

Shares of the same Class of Funds purchased by
exchange
will be purchased on the basis of relative net asset value per
share as follows:

A. Exchanges for shares of Funds that are offered
without
a sales load will be made without a sales load.

B. Shares of Funds purchased without a sales load
may be
exchanged for shares of other Funds sold with a
sales
load, and the applicable sales load will be
deducted.

C. Shares of Funds purchased with a sales load may
be
exchanged without a sales load for shares of
other
Funds sold without a sales load.

D. Shares of Funds purchased with a sales load,
shares of
Funds acquired by a previous exchange from
shares
purchased with a sales load and additional
shares
acquired through reinvestment of dividends or
distributions of any such Funds (collectively
referred
to herein as "Purchased Shares") may be
exchanged for
shares of other Funds sold with a sales load
(referred
to herein as "Offered Shares"), provided that,
if the
sales load applicable to the Offered Shares
exceeds the
maximum sales load that could have been imposed
in
connection with the Purchased Shares (at the
time the
Purchased Shares were acquired), without giving
effect
to any reduced loads, the difference will be
deducted.

E. Shares of Funds subject to a CDSC that are
exchanged
for shares of another Fund will be subject to
the
higher applicable CDSC of the two Funds, and for
purposes of calculating CDSC rates and
conversion
periods, if any, will be deemed to have been
held since
the date the shares being exchanged were
initially
purchased.

To accomplish an exchange under item D above,
shareholders
must notify the Transfer Agent of their prior ownership of Fund
shares and their account number.

No fees currently are charged shareholders
directly in
connection with exchanges although the Trust reserves the right,
upon not less than 60 days' written notice, to charge
shareholders a nominal fee in accordance with rules promulgated
by the Securities and Exchange Commission. The Trust reserves
the right to reject any exchange request in whole or in part.
The Exchange Privilege may be modified or terminated at any time
upon notice to shareholders.

The exchange of shares of one Fund for shares of
another is treated for Federal income tax purposes as a sale of
the shares given in exchange by the shareholder and, therefore,
an exchanging shareholder may realize a taxable gain or loss.

LETTER OF INTENT--CLASS A SHARES. By signing a Letter of Intent
form, available from the Distributor, FIMCO, certain affiliates
of FIMCO, or certain Service Agents, an investor becomes eligible
for the reduced sales load applicable to the total number of
Eligible Fund shares purchased in a 13-month period (beginning up
to 30 days before the date of execution of the Letter of Intent)
pursuant to the terms and conditions set forth in the Letter of
Intent. A minimum initial purchase of $5,000 is required. To
compute the applicable sales load, the offering price of shares
the investor holds (on the date of submission of the Letter of
Intent) in any Eligible Fund that may be used toward "Right of
Accumulation" benefits described above may be used as a credit
toward completion of the Letter of Intent. However, the reduced
sales load will be applied only to new purchases.

The Transfer Agent will hold in escrow 5% of the
amount
indicated in the Letter of Intent for payment of a higher sales
load if the investor does not purchase the full amount indicated
in the Letter of Intent. The escrow will be released when the
investor fulfills the terms of the Letter of Intent by purchasing
the specified amount. Assuming completion of the total minimum
investment specified under a Letter of Intent, an adjustment will
be made to reflect any reduced sales load applicable to shares
purchased during the 30-day period before submission of the
Letter of Intent. In addition, if the investor's purchases
qualify for a further sales load reduction, the sales load will
be adjusted to reflect the investor's total purchase at the end
of 13 months. If total purchases are less than the amount
specified, the investor will be requested to remit an amount
equal to the difference between the sales load actually paid and
the sales load applicable to the aggregate purchases actually
made. If such remittance is not received within 20 days, the
Transfer Agent, as attorney-in-fact pursuant to the terms of the
Letter of Intent, will redeem an appropriate number of Class A
shares held in escrow to realize the difference. Signing a
Letter of Intent does not bind the investor to purchase, or the
Trust to sell, the full amount indicated at the sales load in
effect at the time of signing, but the investor must complete the
intended purchase to obtain the reduced sales load. At the time
an investor purchases Class A shares, the investor must indicate
his or her intention to do so under a Letter of Intent.

AUTOMATIC INVESTMENT PLAN. The Automatic Investment Plan permits
an investor to purchase shares at regular intervals selected by
the investor. Provided the investor's bank or other financial
institution allows automatic withdrawals, shares may be purchased
by transferring funds from the bank account designated by the
investor. At the investor's option, the account designated will
be debited in the specified amount, and shares will be purchased,
once a month, on either the first or fifteenth day, or twice a
month, on both days. Only an account maintained at a domestic
financial institution which is an Automated Clearing House member
may be so designated. To establish an Automatic Investment Plan
account, the investor must check the appropriate box and supply
the necessary information on the Account Application. Investors
may obtain the necessary applications from the Distributor. An
investor may cancel his or her participation in the Plan or
change the amount of purchase at any time by mailing written
notification to __________________, and such notification will be
effective three business days following receipt. The Trust may
modify or terminate the Automatic Investment Plan at any time or
charge a service fee. No such fee currently is contemplated.

REINSTATEMENT PRIVILEGE. The Reinstatement Privilege enables
investors who have redeemed Class A or Class B shares to
repurchase, within 30 days of such redemption, Class A or Class B
shares in an amount not to exceed the redemption proceeds
received. Class A shares so reinstated will be offered at a
purchase price equal to the then-current net asset value of Class
A determined after a reinstatement request and payment for Class
A shares are received by the Transfer Agent. With respect to
Class B shares so reinstated, the CDSC applicable on redemption
of the acquired Class B shares will be calculated from the date
of the initial purchase of such Class B shares previously
redeemed. This privilege also enables such investors to
reinstate their account for the purpose of exercising the
Exchange Privilege. To use the Reinstatement Privilege, an
investor must submit a written reinstatement request to the
Transfer Agent. The reinstatement request and payment must be
received within 30 days of the trade date of the redemption.
There currently are no restrictions on the number of times an
investor may use this privilege.

HOW TO REDEEM SHARES

GENERAL. An investor may request redemption of his shares at any
time. Redemption requests should be transmitted to the Transfer
Agent as described below. An investor who has purchased shares
through his Fiduciary Account or as a participant in an Eligible
Retirement Plan must redeem shares by following instructions
pertaining to such Account or Plan. It is the responsibility of
FNBC to transmit the redemption order to the Transfer Agent and
credit the investor's account with the redemption proceeds on a
timely basis. When a request is received in proper form, the
Trust will redeem the shares at the next determined net asset
value as described below. If an investor holds Fund shares of
more than one Class, any request for redemption must specify the
Class of shares being redeemed. If an investor fails to specify
the Class of shares to be redeemed, Class A shares will be
redeemed first. If an investor owns fewer shares of the Class
than specified to be redeemed, the redemption request may be
delayed until the Transfer Agent receives further instructions
from the investor or his Service Agent.

The Trust imposes no charges when shares are
redeemed.
However, the Distributor may impose a CDSC as described below.
Service Agents may charge a nominal fee for effecting redemptions
of Fund shares. The value of the shares redeemed may be more or
less than their original cost, depending upon the Fund's
then-current net asset value.

The Trust ordinarily will make payment for all
shares
redeemed within seven days after receipt by the Transfer Agent of
a redemption request in proper form, except as provided by the
rules of the Securities and Exchange Commission. HOWEVER, IF AN
INVESTOR HAS PURCHASED FUND SHARES BY CHECK AND SUBSEQUENTLY
SUBMITS A WRITTEN REDEMPTION REQUEST TO THE TRANSFER AGENT, THE
REDEMPTION PROCEEDS WILL BE TRANSMITTED TO THE INVESTOR PROMPTLY
UPON BANK CLEARANCE OF THE INVESTOR'S PURCHASE CHECK, WHICH MAY
TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN ADDITION, THE FUND
WILL NOT HONOR REDEMPTION CHECKS FOR A PERIOD OF EIGHT BUSINESS
DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE CHECK
AGAINST WHICH SUCH REDEMPTION IS REQUESTED. THESE PROCEDURES
WILL NOT APPLY IF THE INVESTOR OTHERWISE HAS A SUFFICIENT
COLLECTED BALANCE IN HIS ACCOUNT TO COVER THE REDEMPTION REQUEST.

PRIOR TO THE TIME ANY REDEMPTION IS EFFECTIVE, DIVIDENDS ON SUCH
SHARES WILL ACCRUE AND BE PAYABLE, AND THE INVESTOR WILL BE
ENTITLED TO EXERCISE ALL OTHER RIGHTS OF BENEFICIAL OWNERSHIP.
Fund shares will not be redeemed until the Transfer Agent has
received the investor's Account Application.

The Trust reserves the right to redeem an
investor's
account at the Trust's option upon not less than 45 days' written
notice if the account's net asset value is $500 or less and
remains so during the notice period.

CONTINGENT DEFERRED SALES CHARGE--CLASS B SHARES. A CDSC payable
to the Distributor may be imposed on redemptions of Class B
shares depending on the number of years such shares were held by
the investor. The following tables set forth the rates of the
CDSC applied for the indicated Funds:

Asset Allocation, Equity
and Bond Funds

CDSC as a
% of Amount
Year Since Invested or
Purchase Payment Redemption
Was Made Proceeds

First 5.00
Second 4.00
Third 3.00
Fourth 3.00
Fifth 2.00
Sixth 1.00
Seventh None
Eighth *
________________
*Conversion to Class A shares.

Intermediate
Municipal
Bond Fund

CDSC as a
% of Amount
Year Since Invested or
Purchase Payment Redemption
Was Made Proceeds

First 3.00
Second 3.00
Third 2.00
Fourth 2.00
Fifth 1.00
Sixth None
Seventh None
Eighth *
________________
*Conversion to Class A shares.

In determining whether a CDSC is applicable to a
redemption, the calculation will be made in a manner that
results in the lowest possible rate. Class B shares redeemed
will not be subject to a CDSC to the extent that the value of
such shares represents capital appreciation or reinvestment of
dividends or distributions. It will be assumed that the
redemption is made first of Class B shares acquired pursuant to
the reinvestment of dividends and distributions or representing
any capital appreciation in the value of the Class B shares
held by the investor; then of Class B shares held for the
longest period of time.

WAIVER OF CDSC. The CDSC will be waived in connection with (a)
redemptions made within one year after the death of the
shareholder, (b) redemptions by shareholders after age 70-1/2
for purposes of the minimum required distribution from an IRA,
Keogh plan or custodial account pursuant to Section 403(b) of
the Code, (c) distributions from a qualified plan upon
retirement, (d) redemptions of shares acquired through a
contribution in excess of permitted amounts, (e) redemptions
initiated by the Trust of accounts with net assets of less than
$500, and (f) redemptions by such shareholders as the
Securities and Exchange Commission or its staff may permit.

CONVERSION OF CLASS B SHARES. Class B shares automatically
convert to Class A shares (and thus become subject to the lower
expenses borne by Class A shares) in the eighth year after the
date of purchase, together with the pro rata portion of all
Class B shares representing dividends and other distributions
paid in additional Class B shares. The conversion will be
effected at the relative net asset values per share of the two
Classes on the first business day of the month following the
seventh anniversary of the original purchase occurs. If any
exchanges of Class B shares during the eight-year period
occurred, the holding period for the shares exchanged will be
counted toward the eight-year period. At the time of the
conversion the net asset value per share of the Class A shares
may be higher or lower than the net asset value per share of
the Class B shares; as a result, depending on the relative net
asset values per share, a shareholder may receive fewer or more
Class A shares than the number of Class B shares converted.

The Trust reserves the right to cease offering
Class
B shares for sale at any time or reject any order for the
purchase of Class B shares and to cease offering any services
provided by Service Agent.

PROCEDURES. An investor who has purchased shares through his
account at FIMCO, FNBC or a Service Agent must redeem shares by
following instructions pertaining to such account. If an
investor has given his Service Agent authority to instruct the
Transfer Agent to redeem shares and to credit the proceeds of
such redemption to a designated account at the Service Agent,
the investor may redeem shares only in this manner and in
accordance with a written redemption request described below.
It is the responsibility of FIMCO, FNBC or the Service Agent,
as the case may be, to transmit the redemption order and credit
the investor's account with the redemption proceeds on a timely
basis.

An investor may redeem or exchange shares by
telephone if the investor has checked the appropriate box on
the Account Application. By selecting a telephone redemption
or exchange privilege, an investor authorizes the Transfer
Agent to act on telephone instructions from any person
representing himself or herself to be the investor, or a
representative of the investor's Service Agent, and reasonably
believed by the Transfer Agent to be genuine. The Trust will
require the Transfer Agent to employ reasonable procedures,
such as requiring a form of personal identification, to confirm
that instructions are genuine and, if it does not follow such
procedures, the Trust or the Transfer Agent may be liable for
any losses due to unauthorized or fraudulent instructions.
Neither the Trust nor the Transfer Agent will be liable for
following telephone instructions reasonably believed to be
genuine.

During times of drastic economic or market
conditions, an investor may experience difficulty in contacting
the Transfer Agent by telephone to request a redemption or
exchange of Fund shares. In such cases, investors should
consider using the other redemption procedures described
herein. Use of these other redemption procedures may result in
the investor's redemption request being processed at a later
time than it would have been if telephone redemption had been
used. During the delay, the Fund's net asset value may
fluctuate.

WRITTEN REDEMPTION REQUESTS. Investors may redeem shares by
written request mailed to Prairie Funds, ___________________.
Redemption requests must be signed by each shareholder,
including each owner of a joint account, and each signature
must be guaranteed. The Transfer Agent has adopted standards
and procedures pursuant to which signature-guarantees in proper
form generally will be accepted from domestic banks, brokers,
dealers, credit unions, national securities exchanges,
registered securities associations, clearing agencies and
savings associations, as well as from participants in the New
York Stock Exchange Medallion Signature Program, the Securities
Transfer Agents Medallion Program ("STAMP"), and the Stock
Exchanges Medallion Program.

CHECK REDEMPTION PRIVILEGE--CLASS A OF MONEY MARKET FUNDS ONLY.
An investor may request on the Account Application or by later
written request to the Trust that a Money Market Fund provide
Redemption Checks drawn on the Fund's account. Redemption
Checks may be made payable to the order of any person in the
amount of $500 or more. Redemption Checks should not be used
to close an account. Redemption Checks are free, but the
Transfer Agent will impose a fee for stopping payment of a
Redemption Check at the investor's request or if the Transfer
Agent cannot honor the Redemption Check due to insufficient
funds or other valid reason. An investor should date his
Redemption Checks with the current date when the investor
writes them. Please do not postdate Redemption Checks. If an
investor does, the Transfer Agent will honor, upon presentment,
even if presented before the date of the check, all postdated
Redemption Checks which are dated within six months of
presentment of payment, if they are otherwise in good order.
This Privilege may be modified or terminated at any time by the
Trust or the Transfer Agent upon notice to shareholders.

MANAGEMENT OF THE TRUST

INVESTMENT ADVISER AND ADMINISTRATOR

First Chicago Investment Management Company,
located
at Three First National Plaza, Chicago, Illinois 60670, is each
Fund's investment adviser and administrator. FIMCO is a newly-
formed, registered investment adviser and a wholly-owned
subsidiary of The First National Bank of Chicago ("FNBC"),
which in turn is a wholly-owned subsidiary of First Chicago
Corporation, a registered bank holding company. FNBC is a
commercial bank offering a wide range of banking and investment
services to customers throughout the United States and around
the world. As of June 30, 1994, FNBC was one of the largest
commercial banks in the United States and the largest in the
mid-western United States in terms of assets ($41.8 billion)
and in terms of deposits ($23.8 billion). As of June 30, 1994,
FNBC provided investment management services to portfolios
containing approximately $9.6 billion in assets.

FIMCO serves as investment adviser for each Fund
pursuant to an Investment Advisory Agreement dated as of
____________, 1994 with the Trust. Under the Investment
Advisory Agreement, FIMCO provides the day-to-day management of
each Fund's investments, subject to the overall authority of
the Trust's Board of Trustees and in conformity with
Massachusetts law and the stated policies of the Trust. FIMCO
is responsible for making investment decisions for each Fund,
placing purchase and sale orders (which may be allocated to
various dealers based on their sales of Fund shares) and
providing research, statistical analysis and continuous
supervision of each Fund's investment portfolio. FIMCO has
advised the Trust that in making its investment decisions FIMCO
does not obtain or use material inside information in its or
any of its affiliate's possession.

FIMCO has engaged ANB-IMC, located at 1 North
LaSalle
Street, Chicago, Illinois 60690, to serve as the International
Equity Fund's sub-investment adviser. ANB-IMC, a registered
investment adviser formed in 1973, is a wholly-owned subsidiary
of American National Bank and Trust Company, which in turn is a
wholly-owned subsidiary of First Chicago Corporation. As of
[March 31,] 1994, ANB-IMC managed approximately $17 billion in
assets, including over $500 million in international equities,
primarily for pension funds. ANB-IMC, subject to the
supervision and approval of FIMCO, provides investment advisory
assistance and the day-to-day management of the International
Equity Fund's investments, as well as investment research and
statistical information, under a Sub-Investment Advisory
Agreement with FIMCO, subject to the overall authority of the
Trust's Board in accordance with Massachusetts law.

The Trust's primary portfolio managers will be:
_______________________.

Under the terms of the Investment Advisory
Agreement
with the Trust, the Trust has agreed to pay FIMCO a monthly fee
at the annual rate of .65% of the value of each Asset
Allocation Fund's average daily net assets; .50% of the value
of the Equity Income Fund's average daily net assets; .65% of
the value of the Growth Fund's average daily net assets; .70%
of the value of the Special Opportunities Fund's average daily
net assets; .80% of the value of the International Equity
Fund's average daily net assets; .55% of the value of the Bond
Fund's average daily net assets; .70% of the value of the
International Bond Fund's average daily net assets; .40% of the
value of the Intermediate Municipal Bond Fund's average daily
net assets; and .55% of the value of each Money Market Fund's
average daily net assets. Under the Sub-Investment Advisory
Agreement between FIMCO and ANB-IMC, FIMCO has agreed to pay
ANB-IMC a monthly fee at the annual rate of .40% of the value
of the International Equity Fund's average daily net assets.
The investment advisory fee payable by the International Equity
Fund is higher than that paid by most other funds.

FIMCO serves as the Trust's administrator
pursuant to
an Administration Agreement with the Trust. Under the
Administration Agreement, FIMCO generally assists in all
aspects of the Trust's operations, other than providing
investment advice, subject to the overall authority of the
Trust's Board in accordance with Massachusetts law. Under the
terms of the Administration Agreement, the Trust has agreed to
pay FIMCO a monthly fee at the annual rate of .15% of the value
of each Fund's average daily net assets. FIMCO has engaged
Concord Holding Corporation, located at 125 West 55th Street,
New York, New York 10019 (the "Sub-Administrator"), to assist
it in providing certain administrative services for the Trust
pursuant to a Master Sub-Administration Agreement between FIMCO
and the Sub-Administrator. FIMCO, from its own funds, will pay
the Sub-Administrator for the Sub-Administrator's services.

DISTRIBUTOR

Concord Financial Group, Inc., located at 125
West
55th Street, New York, New York 10019, serves as the Trust's
principal underwriter and distributor of each Fund's shares.
The Distributor, a wholly-owned subsidiary of the Sub-
Administrator, was organized to distribute shares of mutual
funds to institutional and retail investors. The Distributor
distributes the shares of other investment companies with over
$21 billion in assets.

TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN

_____________________________________, is the
Trust's
Transfer and Dividend Disbursing Agent (the "Transfer Agent").
The Bank of New York, 110 Washington Street, New York, New York
10286, is the Trust's Custodian.

EXPENSES

All expenses incurred in the operation of the
Trust
are borne by the Trust, except to the extent specifically
assumed by FIMCO. The expenses borne by the Trust include:
organizational costs, taxes, interest, loan commitment fees,
interest and distributions paid on securities sold short,
brokerage fees and commissions, if any, fees of Board members,
Securities and Exchange Commission fees, state Blue Sky
qualification fees, advisory fees, charges of custodians,
transfer and dividend disbursing agents' fees, certain
insurance premiums, industry association fees, outside auditing
and legal expenses, costs of maintaining the Trust's existence,
costs of independent pricing services, costs attributable to
investor services (including, without limitation, telephone and
personnel expenses), costs of shareholders' reports and
meetings, costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes
and for distribution to existing shareholders, and any
extraordinary expenses. In addition, Class B shares are
subject to an annual distribution fee for advertising,
marketing and distributing such shares and an annual service
fee for ongoing personal services relating to shareholder
accounts and services related to the maintenance of shareholder
accounts. See "Distribution Plan and Shareholder Services
Plan." Expenses attributable to a particular Fund or Class are
charged against the assets of that Fund or Class, respectively;
other expenses of the Trust are allocated among the Funds on
the basis determined by the Board of Trustees, including, but
not limited to, proportionately in relation to the net assets
of each Fund.

The imposition of the advisory fee, as well as
other
operating expenses, including the fees paid under any
Distribution Plan and Shareholder Services Plan, will have the
effect of reducing the yield to investors. From time to time,
FIMCO may waive receipt of its fees and/or voluntarily assume
certain expenses of a Fund, which would have the effect of
lowering that Fund's overall expense ratio and increasing yield
to investors at the time such amounts are waived or assumed, as
the case may be. The Trust will not pay FIMCO at a later time
for any amounts which may be waived, nor will the Trust
reimburse FIMCO for any amounts which may be assumed.

DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN

Class B shares of each Fund are subject to an
annual
distribution fee pursuant to the Distribution Plan. Class A
and Class B shares of each Fund are subject to an annual
service fee pursuant to the Shareholder Services Plan.

DISTRIBUTION PLAN--(Class B only) Under the Distribution Plan,
adopted pursuant to Rule 12b-1 under the 1940 Act, the Trust
has agreed to pay the Distributor for advertising, marketing
and distributing shares of the relevant Fund at an aggregate
annual rate of .75% (.50% in the case of the Intermediate Bond
Fund) of the value of the average daily net assets of Class B.
The Distributor may pay one or more Service Agents in respect
of these services. FIMCO, FNBC, ANB and their affiliates may
act as Service Agents and receive fees under the Distribution
Plan. The Distributor determines the amounts, if any, to be
paid to Service Agents under the Distribution Plan and the
basis on which such payments are made. The fees payable under
the Distribution Plan are payable without regard to actual
expenses incurred.

SHAREHOLDER SERVICES PLAN--(Class A and Class B) Under the
Shareholder Services Plan, the Trust pays the Distributor for
the provision of certain services to the holders of these
shares a fee at an annual rate of .25% of the value of the
average daily net assets of Class A or Class B. The services
provided may include personal services relating to shareholder
accounts, such as answering shareholder inquiries regarding the
Fund and providing reports and other information, and services
related to the maintenance of shareholder accounts. Under the
Shareholder Services Plan, the Distributor may make payments to
Service Agents in respect of these services. FIMCO, FNBC, ANB
and their affiliates may act as Service Agents and receive fees
under the Shareholder Services Plan. The Distributor
determines the amounts to be paid to Service Agents. Each
Service Agent is required to disclose to its clients any
compensation payable to it by the Trust pursuant to the
Shareholder Services Plan and any other compensation payable by
their clients in connection with the investment of their assets
in Fund shares.

DIVIDENDS, DISTRIBUTIONS AND TAXES

MANAGED ASSETS BALANCED, GROWTH, SPECIAL OPPORTUNITIES AND
INTERNATIONAL EQUITY FUNDS--Declare and pay dividends from net
investment income quarterly.

MANAGED ASSETS INCOME AND EQUITY INCOME FUNDS--Declare and pay
dividends from net investment income monthly, usually on the
last calendar day of the month.

BOND, MUNICIPAL BOND AND MONEY MARKET FUNDS--Declare dividends
from net investment income on each day the New York Stock
Exchange is open for business, except on Martin Luther King,
Jr. Day, Columbus Day and Veterans Day. Dividends usually are
paid on the last calendar day of each month. Shares begin
accruing dividends on the day the purchase order is effective.
The earnings for Saturdays, Sundays and holidays are declared
as dividends on the preceding business day.

APPLICABLE TO ALL FUNDS--Each Fund will make distributions from
net realized securities gains, if any, once a year, but may
make distributions on a more frequent basis to comply with the
distribution requirements of the Code, in all events in a
manner consistent with the provisions of the 1940 Act.
Dividends are automatically reinvested in additional Fund
shares of the same Class from which they were paid at net asset
value, unless payment in cash is requested.

Dividends paid by each Fund, other than a
Municipal
Fund, derived from net investment income and dividends paid by
a Municipal Fund derived from taxable investments, together
with distributions from any net realized short-term securities
gains, will be taxable to U.S. investors as ordinary income
whether or not reinvested in additional Fund shares.
Distributions from net realized long-term securities gains, if
any, will be taxable to U.S. shareholders as long-term capital
gains for Federal income tax purposes, regardless of how long
investors have held shares and whether such distributions are
received in cash or reinvested in additional shares.

Notice as to the tax status of an investor's
dividends and distributions will be mailed to such investor
annually. Each investor also will receive periodic summaries
of such investor's account which will include information as to
dividends and distributions from securities gains, if any, paid
during the year. Participants in a Retirement Plan should
receive periodic statements from the trustee, custodian or
administrator of their Plan.

Federal regulations generally require the Trust
to
withhold ("backup withholding") and remit to the U.S. Treasury
31% of dividends, distributions from net realized securities
gains and the proceeds of any redemption, regardless of the
extent to which gain or loss may be realized, paid to a
shareholder if such shareholder fails to certify either that
the TIN furnished in connection with opening an account is
correct or that such shareholder has not received notice from
the IRS of being subject to backup withholding as a result of a
failure to properly report taxable dividend or interest income
on a Federal income tax return. Furthermore, the IRS may
notify the Trust to institute backup withholding if the IRS
determines a shareholder's TIN is incorrect or if a shareholder
has failed to properly report taxable dividend and interest
income on a Federal income tax return. A TIN is either the
Social Security number or employer identification number of the
record owner of the account.

It is expected that each Fund will qualify as a
"regulated investment company" under the Code so long as such
qualification is in the best interests of its shareholders.
Such qualification relieves the Fund of any liability for
Federal income tax to the extent its earnings are distributed
in accordance with applicable provisions of the Code. In
addition, each Fund is subject to a non-deductible 4% excise
tax, measured with respect to certain undistributed amounts of
taxable investment income and capital gains.

Each investor should consult his or her tax
adviser
regarding specific questions as to Federal, state or local
taxes.

PERFORMANCE
INFORMATION

SPECIAL OPPORTUNITIES, GROWTH AND INTERNATIONAL EQUITY FUNDS--
For purposes of advertising, performance of these Funds may be
calculated on the bases of average annual total return and/or
total return. Average annual total return is calculated
pursuant to a standardized formula which assumes that an
investment in such Fund was purchased with an initial payment
of $1,000 and that the investment was redeemed at the end of a
stated period of time, after giving effect to the reinvestment
of dividends and distributions during the period. The return
is expressed as a percentage rate which, if applied on a
compounded annual basis, would result in the redeemable value
of the investment at the end of the period. Advertisements of
a Fund's performance will include such Fund's average annual
total return for one, five and ten year periods, or for shorter
time periods depending upon the length of time during which the
Fund has operated. Computations of average annual total return
for periods of less than one year represent an annualization of
the Fund's actual total return for the applicable period.

Total return is computed on a per share basis
and
assumes the reinvestment of dividends and distributions. Total
return generally is expressed as a percentage rate which is
calculated by combining the income and principal changes for a
specified period and dividing by the maximum offering price per
share at the beginning of the period. Advertisements may
include the percentage rate of total return or may include the
value of a hypothetical investment at the end of the period
which assumes the application of the percentage rate of total
return. Total return also may be calculated by using the net
asset value per share at the beginning of the period instead of
the maximum offering price per share at the beginning of the
period for Class A shares or without giving effect to any
applicable CDSC at the end of the period for Class B shares.
Calculations based on the net asset value per share do not
reflect the deduction of the applicable sales charge which, if
reflected, would reduce the performance quoted.

MANAGED ASSETS INCOME, MANAGED ASSETS BALANCED, EQUITY INCOME,
BOND AND MUNICIPAL BOND FUNDS--For purposes of advertising,
performance of these Funds may be calculated on several bases,
including current yield, average annual total return and/or
total return. Current yield refers to the Fund's annualized
net investment income per share over a 30-day period, expressed
as a percentage of the net asset value per share at the end of
the period. For purposes of calculating current yield, the
amount of net investment income per share during that 30-day
period, computed in accordance with regulatory requirements, is
compounded by assuming that it is reinvested at a constant rate
over a six-month period. An identical result is then assumed
to have occurred during a second six-month period which, when
added to the result for the first six months, provides an
"annualized" yield for an entire one-year period.

The Municipal Bond Funds may advertise tax
equivalent
yield, which is calculated by determining the pre-tax yield
which, after being taxed at a certain rate, would be equivalent
to a stated current yield calculated as described above.

Average annual total return and total return
will be
calculated as described above.

MONEY MARKET FUNDS--From time to time, each Money Market Fund
may advertise its yield and effective yield. Both yield
figures are based on historical earnings and are not intended
to indicate future performance. It can be expected that these
yields will fluctuate substantially. The yield of the Fund
refers to the income generated by an investment in the Fund
over a seven-day period (which period will be stated in the
advertisement). This income is then annualized. That is, the
amount of income generated by the investment during that week
is assumed to be generated each week over a 52-week period and
is shown as a percentage of the investment. The effective
yield is calculated similarly but, when annualized, the income
earned by an investment in the Fund is assumed to be
reinvested. The effective yield will be slightly higher than
the yield because of the compounding effect of this assumed
reinvestment.

The Municipal Money Market Fund also may
advertise
tax equivalent yield, which would be calculated as described
above.

APPLICABLE TO ALL FUNDS--Performance will vary from time to
time and past results are not necessarily representative of
future results. Investors should remember that performance is
a function of the type and quality of portfolio securities held
by the Fund and is affected by operating expenses. Yield and
performance information, such as that described above, may not
provide a basis for comparison with other investments or other
investment companies using a different method of calculating
performance. Performance for each Class will be calculated
separately.

Comparative performance information may be used
from
time to time in advertising or marketing a Fund's shares,
including data from Lipper Analytical Services, Inc., Bank Rate
Monitor, N. Palm Beach, Fla. 33408, Bond 20-Bond Index, Moody's
Bond Survey Bond Index, Lehman Corporate Bond Index,
IBC/Donoghue's Money Fund Report, S&P 500 Index, Lehman
Brothers Government/Corporate Bond Index, the Dow Jones
Industrial Average, CDA/Wiesenberger Investment Companies
Service, Mutual Fund Values; Mutual Fund Forecaster, Schabacker
Investment Management, Inc., Morningstar, Inc. and other
industry publications.

GENERAL INFORMATION

The Trust was organized as an unincorporated
business
trust under the laws of the Commonwealth of Massachusetts
pursuant to an Agreement and Declaration of Trust (the "Trust
Agreement") dated October 20, 1994, and has not engaged in
active business to the date of this Prospectus. The Trust is
authorized to issue an unlimited number of shares of beneficial
interest, par value $.001 per share. The Trust's shares are
classified into three classes. Each share has one vote and
shareholders will vote in the aggregate and not by class except
as otherwise required by law or with respect to any matter
which affects only one class.

To date, the Board of Trustees has authorized
the
creation of 12 separate portfolios of shares. All
consideration received by the Trust for shares of one of the
portfolios and all assets in which such consideration is
invested will belong to that portfolio (subject only to the
rights of creditors of the Trust) and will be subject to the
liabilities related thereto. The income attributable to, and
the expenses of, one portfolio (and as to classes within a
portfolio) are treated separately from those of the other
portfolios (and classes). The Trust has the ability to create,
from time to time, new portfolios without shareholder approval.

Under Massachusetts law, shareholders could,
under
certain circumstances, be held personally liable for the
obligations of the Trust. However, the Trust Agreement
disclaims shareholder liability for acts or obligations of the
Trust and requires that notice of such disclaimer be given in
each agreement, obligation or instrument entered into or
executed by the Trust or a Trustee. The Trust Agreement
provides for indemnification from the Trust's property for all
losses and expenses of any shareholder held personally liable
for the obligations of the Trust. 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, a possibility which
management believes is remote. Upon payment of any liability
incurred by the Trust, the shareholder paying such liability
will be entitled to reimbursement from the general assets of
the Trust. The Trustees intend to conduct the operations of
the Trust in such a way so as to avoid, as far as possible,
ultimate liability of the shareholders for liabilities of the
Trust. As described under "Management of the Trust" in the
Statement of Additional Information, the Trust ordinarily will
not hold shareholder meetings; however, shareholders under
certain circumstances have the right to call a meeting of
shareholders for the purpose of voting to remove Trustees.

The Transfer Agent maintains a record of each
investor's ownership and sends confirmations and statements of
account.

Investor inquiries may be made by writing to the
Trust at the address shown on page one or by calling the
appropriate telephone number.

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION
OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS AND IN THE TRUST'S OFFICIAL SALES LITERATURE IN
CONNECTION WITH THE OFFER OF THE FUNDS' SHARES, AND, IF GIVEN
OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE TRUST. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH,
OR TO ANY PERSON TO WHOM, SUCH OFFERING MAY NOT LAWFULLY BE
MADE.

<PAGE>
APPENDIX

CERTAIN PORTFOLIO SECURITIES

EQUITY SECURITIES

American, European and Continental Depositary Receipts--(Asset
Allocation, Equity Income, Growth, International and Special
Opportunities Funds only) Securities of foreign issuers may be
sold in the form of American Depositary Receipts ("ADRs") and
European Depositary Receipts ("EDRs"). These securities may
not necessarily be denominated in the same currency as the
securities into which they may be converted. ADRs are receipts
typically issued by a United States bank or trust company which
evidence ownership of underlying securities issued by a foreign
corporation. EDRs, which are sometimes referred to as
Continental Depositary Receipts ("CDRs"), are receipts issued
in Europe typically by non-United States banks and trust
companies that evidence ownership of either foreign or domestic
securities. Generally, ADRs in registered form are designed
for use in the United States securities markets and EDRs and
CDRs in bearer form are designed for use in Europe.

Warrants--(Asset Allocation and Equity Funds only) A warrant is
an instrument issued by a corporation which gives the holder
the right to subscribe to a specified amount of the
corporation's capital stock at a set price for a specified
period of time. Each of these Funds may invest up to 5% of its
net assets in warrants, except that this limitation does not
apply to warrants acquired in units or attached to securities.

FIXED-INCOME SECURITIES

Convertible Securities--(Asset Allocation, Equity and Bond
Funds only) Convertible securities are fixed-income securities
that may be converted at either a stated price or stated rate
into underlying shares of common stock. Convertible securities
have general characteristics similar to both fixed-income and
equity securities. Although to a lesser extent than with
fixed-income securities generally, the market value of
convertible securities tends to decline as interest rates
increase and, conversely, tends to increase as interest rates
decline. In addition, because of the conversion feature, the
market value of convertible securities tends to vary with
fluctuations in the market value of the underlying common
stock, and, therefore, also will react to variations in the
general market for equity securities. A unique feature of
convertible securities is that as the market price of the
underlying common stock declines, convertible securities tend
to trade increasingly on a yield basis, and so may not
experience market value declines to the same extent as the
underlying common stock. When the market price of the
underlying common stock increases, the prices of the
convertible securities tend to rise as a reflection of the
value of the underlying common stock. While no securities
investments are without risk, investments in convertible
securities generally entail less risk than investments in
common stock of the same issuer.

As fixed-income securities, convertible
securities
are investments that provide for a stable stream of income with
generally higher yields than common stocks. Of course, like
all fixed-income securities, there can be no assurance of
current income because the issuers of the convertible
securities may default on their obligations. Convertible
securities, however, generally offer lower interest or dividend
yields than non-convertible securities of similar quality
because of the potential for capital appreciation. A
convertible security, in addition to providing fixed income,
offers the potential for capital appreciation through the
conversion feature, which enables the holder to benefit from
increases in the market price of the underlying common stock.
There can be no assurance of capital appreciation, however,
because securities prices fluctuate.

Convertible securities generally are
subordinated to
other similar but non-convertible securities of the same
issuer, although convertible bonds, as corporate debt
obligations, enjoy seniority in right of payment to all equity
securities, and convertible preferred stock is senior to common
stock, of the same issuer. Because of the subordination
feature, however, convertible securities typically have lower
ratings than similar non-convertible securities.

U.S. Government Securities--These securities are described
under "Taxable Money Market Instruments--U.S. Government
Securities" below and may be purchased without regard to
maturity.

Zero Coupon and Stripped Securities--(Asset Allocation, Equity,
Bond and Municipal Bond Funds only) Zero coupon U.S. Treasury
securities are Treasury Notes and Bonds that have been stripped
of their unmatured interest coupons, the coupons themselves and
receipts or certificates representing interests in such
stripped debt obligations and coupons. Zero coupon securities
also are issued by corporations and financial institutions
which constitute a proportionate ownership of the issuer's pool
of underlying U.S. Treasury securities. A zero coupon security
pays no interest to its holder during its life and is sold at a
discount to its face value at maturity. The amount of the
discount fluctuates with the market price of the security. The
market prices of zero coupon securities generally are more
volatile than the market prices of securities that pay interest
periodically and are likely to respond to a greater degree to
changes in interest rates than non-zero coupon securities
having similar maturities and credit qualities.

Participation Interests--(Asset Allocation, Equity, Bond and
Money Market Funds only) A participation interest gives the
purchaser an undivided interest in a security in the proportion
that such purchaser's participation interest bears to the total
principal amount of the security. These instruments may have
fixed, floating or variable rates of interest, with, in the
case of the Money Market Fund, remaining maturities of 13
months or less. If the participation interest is unrated, or
has been given a rating below that which is permissible for
purchase by a Fund, the participation interest will be backed
by an irrevocable letter of credit or guarantee of a bank, or
the payment obligation otherwise will be collateralized by U.S.
Government securities, or, in the case of unrated participation
interests, the Investment Adviser must have determined that the
instrument is of comparable quality to those instruments in
which such Fund may invest.

Mortgage-Related Securities--(Asset Allocation, Equity and Bond
Funds only) Mortgage-related securities are securities
collateralized by pools of mortgage loans assembled for sale to
investors by various governmental agencies, such as the
Government National Mortgage Association and government-related
organizations such as the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation, as well as by
private issuers such as commercial banks, savings and loan
institutions, mortgage banks and private mortgage insurance
companies, and similar foreign entities. Mortgage-related
securities are a form of derivative security. The mortgage-
related securities which may be purchased include those with
fixed, floating and variable interest rates, those with
interest rates that change based on multiples of changes in
interest rates and those with interest rates that change
inversely to changes in interest rates, as well as stripped
mortgage-backed securities. Stripped mortgage-backed
securities usually are structured with two classes that receive
different proportions of interest and principal distributions
on a pool of mortgage-backed securities or whole loans. A
common type of stripped mortgage-backed security will have one
class receiving some of the interest and most of the principal
from the mortgage collateral, while the other class will
receive most of the interest and the remainder of the
principal. In the most extreme case, one class will receive
all of the interest (the interest-only or "IO" class), while
the other class will receive all of the principal (the
principal-only or "PO" class). 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 mortgage-related security
is purchased at a premium, all or part of the premium 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 certain of these 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 security are more likely to prepay. For this
and other reasons, a mortgage-related security's stated
maturity may be shortened by unscheduled prepayments on the
underlying mortgages, and, therefore, it is not possible to
predict accurately the security's return to a Fund. Moreover,
with respect to stripped mortgage-backed securities, if the
underlying mortgage securities experience greater than
anticipated prepayments of principal, the Fund may fail to
fully recoup its initial investment in these securities even if
the securities are rated in the highest rating category by a
nationally recognized statistical rating organization. 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 Fund will receive
when these amounts are reinvested. For further discussion
concerning the investment considerations involved, see
"Description of the Funds--Risk Factors--Fixed-Income
Securities" and "Illiquid Securities" below and "Investment
Objectives and Management Policies--Portfolio Securities--
Mortgage-Related Securities" in the Statement of Additional
Information.

Asset-Backed Securities--(Asset Allocation, Equity and Bond
Funds only) The securitization techniques used for asset-backed
securities are similar to those used for mortgage-related
securities. Asset-backed securities are a form of derivative
security. These securities include debt securities and
securities with debt-like characteristics. The collateral for
these securities has included home equity loans, automobile and
credit card receivables, boat loans, computer leases, airplane
leases, mobile home loans, recreational vehicle loans and
hospital account receivables. These Funds may invest in these
and other types of asset-backed securities that may be
developed in the future.

Asset-backed securities present certain risks
that
are not presented by mortgage-backed securities. Primarily,
these securities do not have the benefit of the same security
interest in the related collateral. Credit card receivables
generally are unsecured and the debtors are entitled to the
protection of a number of state and Federal consumer credit
laws, many of which give such debtors the right to set off
certain amounts owed on the credit cards, thereby reducing the
balance due. Most issuers of asset-backed securities backed by
automobile receivables permit the servicers of such receivables
to retain possession of the underlying obligations. If the
servicer were to sell these obligations to another party, there
is a risk that the purchaser would acquire an interest superior
to that of the holders of the related asset-backed securities.
In addition, because of the large number of vehicles involved
in a typical issuance and technical requirements under state
laws, the trustee for the holders of asset-backed securities
backed by automobile receivables may not have a proper security
interest in all of the obligations backing such receivables.
Therefore, there is the possibility that recoveries on
repossessed collateral may not, in some cases, be available to
support payments on these securities.

Municipal Obligations--(Asset Allocation, Equity, Bond and
Municipal Funds only) Municipal Obligations generally include
debt obligations issued to obtain funds for various public
purposes as well as certain industrial development bonds issued
by or on behalf of public authorities. While in general,
Municipal Obligations are tax exempt securities having
relatively low yields as compared to taxable, non-municipal
obligations of similar quality, certain issues of Municipal
Obligations, both taxable and non-taxable, offer yields
comparable and in some cases greater than the yields available
on other permissible investments. Dividends received by
shareholders of a Fund, other than a Municipal Fund, which are
attributable to interest income received by it from Municipal
Obligations generally will be subject to Federal income tax.
Municipal Obligations bear fixed, floating or variable rates of
interest, which are determined in some instances by formulas
under which the Municipal Obligation's interest rate will
change directly or inversely to changes in interest rates or an
index, or multiples thereof, in many cases subject to a maximum
and minimum. Each of these Funds, other than the Municipal
Funds, currently intends to invest no more than 25% of its
respective assets in Municipal Obligations. However, this
percentage may be varied from time to time without shareholder
approval.

Unregistered Notes--(Asset Allocation, Equity, Bond and Money
Market Funds only) Each of these Funds may purchase unsecured
promissory notes ("Notes") which are not readily marketable and
have not been registered under the Securities Act of 1933, as
amended, provided such investments are consistent with such
Fund's goal.

Foreign Government Obligations; Securities of Supranational
Entities--(Asset Allocation, International Equity, Growth,
Special Opportunities, Bond and Money Market Funds only) Each
of these Funds may invest in obligations issued or guaranteed
by one or more foreign governments or any of their political
subdivisions, agencies or instrumentalities that are determined
by the Investment Adviser to be of comparable quality to the
other obligations in which such Fund may invest. Such
securities also include debt obligations of supranational
entities. Supranational entities include international
organizations designated or supported by governmental entities
to promote economic reconstruction or development and
international banking institutions and related government
agencies. Examples include the International Bank for
Reconstruction and Development (the World Bank), the European
Coal and Steel Community, the Asian Development Bank and the
InterAmerican Development Bank. The percentage of a Fund's
assets invested in securities issued by foreign governments
will vary depending on the relative yields of such securities,
the economic and financial markets of the countries in which
the investments are made and the interest rate climate of such
countries.

Ratings--The ratings of Moody's, S&P, Fitch and Duff represent
their opinions as to the quality of the obligations which they
undertake to rate. It should be emphasized, however, that
ratings are relative and subjective and, although ratings may
be useful in evaluating the safety of interest and principal
payments, they do not evaluate the market value risk of such
obligations. Therefore, although these ratings may be an
initial criterion for selection of portfolio investments, the
Investment Adviser also will evaluate such obligations and the
ability of their issuers to pay interest and principal. Each
Fund will rely on the Investment Adviser's judgment, analysis
and experience in evaluating the creditworthiness of an issuer.
In this evaluation, the Investment Adviser will take into
consideration, among other things, the issuer's financial
resources, its sensitivity to economic conditions and trends,
the quality of the issuer's management and regulatory matters.
It also is possible that a rating agency might not timely
change the rating on a particular issue to reflect subsequent
events. Once the rating of a security held by a Fund has been
changed, the Investment Adviser will consider all circumstances
deemed relevant in determining whether such Fund should
continue to hold the security.

TAXABLE MONEY MARKET INSTRUMENTS

Each Fund may invest, in the circumstances
described
under "Description of the Funds--Management Policies," in the
following types of Money Market Instruments, each of which at
the time of purchase must have or be deemed to have under the
rules of the Securities and Exchange Commission remaining
maturities of 13 months or less.

U.S. Government Securities--Securities issued or guaranteed by
the U.S. Government or its agencies or instrumentalities
include U.S. Treasury securities that differ in their interest
rates, maturities and times of issuance. Treasury Bills have
initial maturities of one year or less; Treasury Notes have
initial maturities of one to ten years; and Treasury Bonds
generally have initial maturities of greater than ten years.
Some obligations issued or guaranteed by U.S. Government
agencies and instrumentalities, for example, Government
National Mortgage Association pass-through certificates, are
supported by the full faith and credit of the U.S. Treasury;
others, such as those of the Federal Home Loan Banks, by the
right of the issuer to borrow from the U.S. Treasury; others,
such as those issued by the Federal National Mortgage
Association, by discretionary authority of the U.S. Government
to purchase certain obligations of the agency or
instrumentality; and others, such as those issued by the
Student Loan Marketing Association, only by the credit of the
agency or instrumentality. These securities bear fixed,
floating or variable rates of interest. Principal and interest
may fluctuate based on generally recognized reference rates or
the relationship of rates. While the U.S. Government provides
financial support to such U.S. Government-sponsored agencies or
instrumentalities, no assurance can be given that it will
always do so, because it is not so obligated by law.

Bank Obligations--(each Fund, except U.S. Government Money
Market Fund) Bank obligations include certificates of deposit,
time deposits, bankers' acceptances and other short-term
obligations of domestic banks, foreign subsidiaries of domestic
banks, foreign branches of domestic banks, and domestic and
foreign branches of foreign banks, domestic savings and loan
associations and other banking institutions. With respect to
such securities issued by foreign branches of domestic banks,
foreign subsidiaries of domestic banks, and domestic and
foreign branches of foreign banks, a Fund may be subject to
additional investment risks that are different in some respects
from those incurred by a fund which invests only in debt
obligations of U.S. domestic issuers. Such risks include
possible future political and economic developments, the
possible imposition of foreign withholding taxes on interest
income payable on the securities, 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 these securities and the possible
seizure or nationalization of foreign deposits.

Certificates of deposit are negotiable
certificates
evidencing the obligation of a bank to repay funds deposited
with it for a specified period of time.

Time deposits are non-negotiable deposits
maintained
in a banking institution for a specified period of time at a
stated interest rate. Time deposits which may be held by each
Fund will not benefit from insurance from the Bank Insurance
Fund or the Savings Association Insurance Fund administered by
the Federal Deposit Insurance Corporation.

Bankers' acceptances are credit instruments
evidencing the obligation of a bank to pay a draft drawn on it
by a customer. These instruments reflect the obligation both
of the bank and of the drawer to pay the face amount of the
instrument upon maturity. The other short-term obligations may
include uninsured, direct obligations bearing fixed, floating
or variable interest rates.

Repurchase Agreements--Repurchase agreements involve the
acquisition by a Fund of an underlying debt instrument, subject
to an obligation of the seller to repurchase, and such Fund to
resell, the instrument at a fixed price usually not more than
one week after its purchase. Certain costs may be incurred by
a Fund in connection with the sale of the securities if the
seller does not repurchase them in accordance with the
repurchase agreement. In addition, if bankruptcy proceedings
are commenced with respect to the seller of the securities,
realization on the securities by a Fund may be delayed or
limited.

Certain Corporate Obligations--(each Fund, except U.S.
Government Money Market Fund) Commercial paper consists of
short-term, unsecured promissory notes issued by domestic or
foreign entities to finance short-term credit needs. Floating
and variable rate demand notes and bonds are obligations
ordinarily having stated maturities in excess of one year, but
which permit the holder to demand payment of principal at any
time or at specified intervals. Variable rate demand notes
include variable amount master demand notes, which are
obligations that permit a Fund to invest fluctuating amounts at
varying rates of interest pursuant to direct arrangements
between the Fund, as lender, and the borrower. These notes
permit daily changes in the amounts borrowed. As mutually
agreed between the parties, the Fund may increase the amount
under the notes at any time up to the full amount provided by
the note agreement, or decrease the amount, and the borrower
may repay up to the full amount of the note without penalty.
Because these obligations are direct lending arrangements
between the lender and borrower, it is not contemplated that
such instruments generally will be traded, and there generally
is no established secondary market for these obligations,
although they are redeemable at face value, plus accrued
interest, at any time. Accordingly, where these obligations
are not secured by letters of credit or other credit support
arrangements, a Fund's right to redeem is dependent on the
ability of the borrower to pay principal and interest on
demand.
TAX EXEMPT MONEY MARKET INSTRUMENTS

Tax Exempt Participation Interests--(Municipal Funds only) A
participation interest in Municipal Obligations (such as
industrial development bonds and municipal lease/purchase
agreements) gives the purchaser an undivided interest in the
Municipal Obligation in the proportion that such purchaser's
participation interest bears to the total principal amount of
the Municipal Obligation. These instruments may have fixed,
floating or variable rates of interest, with remaining
maturities of 13 months or less. If the participation interest
is unrated, or has been given a rating below that which
otherwise is permissible for purchase by a Fund, the
participation interest will be backed by an irrevocable letter
of credit or guarantee of a bank that the Board of Trustees has
determined meets the prescribed quality standards for banks set
forth above, or the payment obligation otherwise will be
collateralized by U.S. Government securities. For certain
participation interests, a Fund will have the right to demand
payment, on not more than seven days' notice, for all or any
part of such Fund's participation interest in the Municipal
Obligation, plus accrued interest. As to these instruments,
each Fund intends to exercise its right to demand payment only
upon a default under the terms of the Municipal Obligation, as
needed to provide liquidity to meet redemptions, or to maintain
or improve the quality of its investment portfolio. No Fund
will invest more than 15% (10% in the case of the Municipal
Money Market Fund) of the value of its net assets in
participation interests that do not have this demand feature,
and in other illiquid securities.

Tender Option Bonds--(Municipal Funds only) A tender option
bond is a Municipal Obligation (generally held pursuant to a
custodial arrangement) having a relatively long maturity and
bearing interest at a fixed rate substantially higher than
prevailing short-term tax exempt rates, that has been coupled
with the agreement of a third party, such as a bank, broker-
dealer or other financial institution, pursuant to which such
institution grants the security holders the option, at periodic
intervals, to tender their securities to the institution and
receive the face value thereof. As consideration for providing
the option, the financial institution receives periodic fees
equal to the difference between the Municipal Obligation's
fixed coupon rate and the rate, as determined by a remarketing
or similar agent at or near the commencement of such period,
that would cause the securities, coupled with the tender
option, to trade at par on the date of such determination.
Thus, after payment of this fee, the security holder
effectively holds a demand obligation that bears interest at
the prevailing short-term tax exempt rate. The Investment
Adviser, on behalf of a Fund, will consider on an ongoing basis
the creditworthiness of the issuer of the underlying Municipal
Obligation, of any custodian and of the third party provider of
the tender option. In certain instances and for certain tender
option bonds, the option may be terminable in the event of a
default in payment of principal or interest on the underlying
Municipal Obligations and for other reasons. No Fund will
invest more than 15% (10% in the case of the Money Market
Funds) of the value of its net assets in securities that are
illiquid, which would include tender option bonds as to which
it cannot exercise the tender feature on not more than seven
days' notice if there is no secondary market available for
these obligations.

Stand-By Commitments--(Municipal Funds only) Each Municipal
Fund may acquire "stand-by commitments" with respect to
Municipal Obligations held in its portfolio. Under a stand-by
commitment, the Fund obligates a broker, dealer or bank to
repurchase, at the Fund's option, specified securities at a
specified price and, in this respect, stand-by commitments are
comparable to put options. The exercise of a stand-by
commitment therefore is subject to the ability of the seller to
make payment on demand. Each Municipal Fund will acquire
stand-by commitments solely to facilitate portfolio liquidity
and does not intend to exercise its rights thereunder for
trading purposes. Each Municipal Fund may pay for stand-by
commitments if such action is deemed necessary, thus increasing
to a degree the cost of the underlying Municipal Obligation and
similarly decreasing such security's yield to investors.

ILLIQUID SECURITIES

Each Fund may invest up to 15% (10% in the case of the Money
Market Funds) of the value of its net assets in securities as
to which a liquid trading market does not exist, provided such
investments are consistent with the Fund's investment
objective. Such securities may include securities that are not
readily marketable, such as certain securities that are subject
to legal or contractual restrictions on resale, repurchase
agreements providing for settlement in more than seven days
after notice, and certain options traded in the over-the-
counter market and securities used to cover such options. As
to these securities, a Fund is subject to a risk that should
such Fund desire to sell them when a ready buyer is not
available at a price the Fund deems representative of their
value, the value of such Fund's net assets could be adversely
affected.

INVESTMENT TECHNIQUES

LEVERAGE THROUGH BORROWING--(Asset Allocation, Equity, Bond
and, to a limited extent, Money Market Funds only) Borrowing
for investment purposes is known as leveraging and generally
will be unsecured, except to the extent a Fund enters into
reverse repurchase agreements described below. The Money
Market Fund may borrow for investment purposes only through
entering into reverse repurchase agreements. The 1940 Act
requires each Fund that engages in such borrowing to maintain
continuous asset coverage (that is, total assets including
borrowings, less liabilities exclusive of borrowings) of 300%
of the amount borrowed. If the 300% asset coverage should
decline as a result of market fluctuations or other reasons,
the Fund may be required to sell some of its portfolio holdings
within three days to reduce the debt and restore the 300% asset
coverage, even though it may be disadvantageous from an
investment standpoint to sell securities at that time.
Leveraging may exaggerate the effect on net asset value of any
increase or decrease in the market value of the Fund's
portfolio. Money borrowed for leveraging will be subject to
interest costs that may or may not be recovered by appreciation
of the securities purchased; in certain cases, interest costs
may exceed the return received on the securities purchased.
The Fund also may be required to maintain minimum average
balances in connection with such borrowing or to pay a
commitment or other fee to maintain a line of credit; either of
these requirements would increase the cost of borrowing over
the stated interest rate.

Among the forms of borrowing in which a Fund may
engage is the entry into reverse repurchase agreements with
banks, brokers or dealers. These transactions involve the
transfer by the Fund of an underlying debt instrument in return
for cash proceeds based on a percentage of the value of the
security. The Fund retains the right to receive interest and
principal payments on the security. At an agreed upon future
date, the Fund repurchases the security at principal, plus
accrued interest. In certain types of agreements, there is no
agreed upon repurchase date and interest payments are
calculated daily, often based on the prevailing overnight
repurchase rate. The Fund will maintain in a segregated
custodial account cash or U.S. Government securities or other
high quality liquid debt securities at least equal to the
aggregate amount of its reverse repurchase obligations, plus
accrued interest, in certain cases, in accordance with releases
promulgated by the Securities and Exchange Commission. The
Securities and Exchange Commission views reverse repurchase
transactions as collateralized borrowings by the Fund. These
agreements, which are treated as if reestablished each day, are
expected to provide the Fund with a flexible borrowing tool.

SHORT-SELLING--(Asset Allocation, Equity and Bond Funds only)
Each of these Funds may make short sales, which are
transactions in which the Fund sells a security it does not own
in anticipation of a decline in the market value of that
security. To complete such a transaction, the Fund must borrow
the security to make delivery to the buyer. The Fund then is
obligated to replace the security borrowed by purchasing it at
the market price at the time of replacement. The price at such
time may be more or less than the price at which the security
was sold by the Fund. Until the security is replaced, the Fund
is required to pay to the lender amounts equal to any dividends
or interest which accrue during the period of the loan. To
borrow the security, the Fund also may be required to pay a
premium, which would increase the cost of the security sold.
The proceeds of the short sale will be retained by the broker,
to the extent necessary to meet margin requirements, until the
short position is closed out.

Until a Fund closes its short position or
replaces
the borrowed security, the Fund will: (a) maintain a
segregated account, containing cash or U.S. Government
securities, at such a level that (i) the amount deposited in
the account plus the amount deposited with the broker as
collateral will equal the current value of the security sold
short and (ii) the amount deposited in the segregated account
plus the amount deposited with the broker as collateral will
not be less than the market value of the security at the time
it was sold short; or (b) otherwise cover its short position.

The Fund will incur a loss as a result of the
short
sale if the price of the security increases between the date of
the short sale and the date on which the Fund replaces the
borrowed security. The Fund will realize a gain if the
security declines in price between those dates. This result is
the opposite of what one would expect from a cash purchase of a
long position in a security. The amount of any gain will be
decreased, and the amount of any loss increased, by the amount
of any premium or amounts in lieu of dividends or interest a
Fund may be required to pay in connection with a short sale.

Each Fund may purchase call options to provide a
hedge against an increase in the price of a security sold short
by such Fund. When a Fund purchases a call option it has to
pay a premium to the person writing the option and a commission
to the broker selling the option. If the option is exercised
by the Fund, the premium and the commission paid may be more
than the amount of the brokerage commission charged if the
security were to be purchased directly. See "Options
Transactions" below.

It is expected that the frequency of short sales
on
behalf of each Fund will vary substantially under different
market conditions, and it is not intended that any specified
portion of a Fund's assets, as a matter of practice, will be
invested in short sales. However, no securities will be sold
short if, after effect is given to any such short sale, the
total market value of all securities sold short would exceed
25% of the value of the Fund's net assets. A Fund will not
sell short the securities of any single issuer listed on a
national securities exchange to the extent of more than 5% of
the value of such Fund's net assets and will not sell short the
securities of any class of an issuer to the extent, at the time
of transaction, of more than 5% of the outstanding securities
of that class.

In addition to the short sales discussed above,
each
Fund may make short sales "against the box," a transaction in
which a Fund enters into a short sale of a security which such
Fund owns. The proceeds of the short sale will be held by a
broker until the settlement date at which time the Fund
delivers the security to close the short position. The Fund
receives the net proceeds from the short sale. At no time will
a Fund have more than 15% of the value of its net assets in
deposits on short sales against the box.

OPTIONS TRANSACTIONS--(Asset Allocation, Equity and Bond Funds
only) Each of these Funds is permitted to invest up to 5% of
its assets, represented by the premium paid, in the purchase of
call and put options.

Each of these Funds is permitted to purchase
call and
put options in respect of specific securities (or groups or
"baskets" of specific securities) in which the Fund may invest.
Each Fund may write and sell covered call option contracts on
securities owned by the Fund not exceeding 20% of the market
value of its net assets at the time such option contracts are
written. Each Fund also may purchase call options to enter
into closing purchase transactions. Each Fund also may write
covered put option contracts to the extent of 20% of the value
of its net assets at the time such option contracts are
written. A call option gives the purchaser of the option the
right to buy, and obligates the writer to sell, the underlying
security at the exercise price at any time during the option
period. Conversely, a put option gives the purchaser of the
option the right to sell, and obligates the writer to buy, the
underlying security at the exercise price at any time during
the option period. A covered put option sold by a Fund exposes
the Fund during the term of the option to a decline in price of
the underlying security or securities. A put option sold by a
Fund is covered when, among other things, cash or liquid
securities are placed in a segregated account with the Trust's
custodian to fulfill the obligation undertaken.

Each of these Funds also may purchase and sell
call
and put options on foreign currency for the purpose of hedging
against changes in future currency exchange rates. Call
options convey the right to buy the underlying currency at a
price which is expected to be lower than the spot price of the
currency at the time the option expires. Put options convey
the right to sell the underlying currency at a price which is
anticipated to be higher than the spot price of the currency at
the time the option expires.

Each of these Funds also may purchase
cash-settled
options on interest rate swaps, interest rate swaps denominated
in foreign currency and equity index swaps. See "--Interest
Rate and Equity Index Swaps" below. A cash-settled option on a
swap gives the purchaser the right, but not the obligation, in
return for the premium paid, to receive an amount of cash equal
to the value of the underlying swap as of the exercise date.
These options typically are purchased in privately negotiated
transactions from financial institutions, including securities
brokerage firms.

Each of these Funds may purchase and sell call
and
put options on stock indexes listed on U.S. securities
exchanges or traded in the over-the-counter market. A stock
index fluctuates with changes in the market values of the
stocks included in the index. Because the value of an index
option depends upon movements in the level of the index rather
than the price of a particular stock, whether a Fund will
realize a gain or loss from the purchase or writing of options
on an index depends upon movements in the level of stock prices
in the stock market generally or, in the case of certain
indexes, in an industry or market segment, rather than
movements in the price of a particular stock.

Successful use by a Fund of options will be
subject
to the Investment Adviser's ability to predict correctly
movements in the direction of individual stocks, the stock
market generally, foreign currencies or interest rates. To the
extent the Investment Adviser's predictions are incorrect, the
Fund may incur losses which could adversely affect the value of
a shareholder's investment.

FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS--(Asset
Allocation, Equity, Bond and Municipal Bond Funds only) Each of
these Funds may enter into stock index futures contracts,
interest rate futures contracts and currency futures contracts,
and options with respect thereto. See "--Options Transactions"
above. These transactions will be entered into as a substitute
for comparable market positions in the underlying securities or
for hedging purposes. Although none of these Funds would be a
commodity pool, each would be subject to rules of the CFTC
limiting the extent to which it could engage in these
transactions.

Engaging in these transactions involves risk of
loss
to a Fund which could adversely affect the value of a
shareholder's investment. Although each of these Funds intends
to purchase or sell futures contracts only if there is an
active market for such contracts, no assurance can be given
that a liquid market will exist for any particular contract at
any particular time. Many futures exchanges and boards of
trade limit the amount of fluctuation permitted in futures
contract prices during a single trading day. Once the daily
limit has been reached in a particular contract, no trades may
be made that day at a price beyond that limit or trading may be
suspended for specified periods during the trading day.
Futures contract prices could move to the limit for several
consecutive trading days with little or no trading, thereby
preventing prompt liquidation of futures positions and
potentially subjecting the Fund to substantial losses. In
addition, engaging in futures transactions in foreign markets
may involve greater risks than trading in domestic exchanges.

Successful use of futures by a Fund also is
subject
to the Investment Adviser's ability to predict correctly
movements in the direction of the market, interest rates or
foreign currencies and, to the extent the transaction is
entered into for hedging purposes, to ascertain the appropriate
correlation between the transaction being hedged and the price
movements of the futures contract. For example, if a Fund has
hedged against the possibility of a decline in the market
adversely affecting the value of securities held in its
portfolio and prices increase instead, the Fund will lose part
or all of the benefit of the increased value of securities
which it has hedged because it will have offsetting losses in
its futures positions. In addition, in such situations, if the
Fund has insufficient cash, it may have to sell securities to
meet daily variation margin requirements. Such sales of
securities may, but will not necessarily, be at increased
prices which reflect the rising market. A Fund may have to
sell securities at a time when it may be disadvantageous to do
so.

Pursuant to regulations and/or published
positions of
the Securities and Exchange Commission, each of these Funds may
be required to segregate cash or high quality money market
instruments in connection with its commodities transactions in
an amount generally equal to the value of the underlying
commodity. The segregation of such assets will have the effect
of limiting the Fund's ability otherwise to invest those
assets.

INTEREST RATE AND EQUITY INDEX SWAPS--(Asset Allocation, Equity
and Bond Funds only) Each of these Funds may enter into
interest rate swaps and equity index swaps, to the extent
described under "Description of the Funds--Management
Policies," in pursuit of their respective investment
objectives. Interest rate swaps involve the exchange by a Fund
with another party of their respective commitments to pay or
receive interest (for example, an exchange of floating-rate
payments for fixed-rate payments). Equity index swaps involve
the exchange by a Fund with another party of cash flows based
upon the performance of an index or a portion of an index which
usually includes dividends. In each case, the exchange
commitments can involve payments to be made in the same
currency or in different currencies.

Each of these Funds usually will enter into
swaps on
a net basis. In so doing, the two payment streams are netted
out, with the Fund receiving or paying, as the case may be,
only the net amount of the two payments. If a Fund enters into
a swap, it would maintain a segregated account in the full
amount accrued on a daily basis of the Fund's obligations with
respect to the swap. Each of these Funds will enter into swap
transactions with counterparties only if: (i) for transactions
with maturities under one year, such counterparty has
outstanding short-term paper rated at least A-1 by S&P, Prime-1
by Moody's, F-1 by Fitch or Duff-1 by Duff, or (ii) for
transactions with maturities greater than one year, the
counterparty has outstanding debt securities rated at least Aa
by Moody's or AA by S&P, Fitch or Duff. If there is a default
by the other party to such a transaction, the Fund will have
contractual remedies pursuant to the agreements related to the
transaction.

The use of swaps is a highly specialized
activity
which involves investment techniques and risks different from
those associated with ordinary portfolio security transactions.
There is no limit on the amount of swap transactions that may
be entered into by a Fund. These transactions do not involve
the delivery of securities or other underlying assets or
principal. Accordingly, the risk of loss with respect to swaps
is limited to the net amount of payments that a Fund is
contractually obligated to make. If the other party to a swap
defaults, the relevant Fund's risk of loss consists of the net
amount of payments that such Fund contractually is entitled to
receive.

FOREIGN CURRENCY TRANSACTIONS--(Asset Allocation, Growth,
International Equity, Special Opportunities and International
Bond Funds only) Each of these Funds may engage in currency
exchange transactions either on a spot (i.e., cash) basis at
the rate prevailing in the currency exchange market, or through
entering into forward contracts to purchase or sell currencies.
A forward currency exchange contract involves an obligation to
purchase or sell a specific currency at a future date, which
must be more than two days from the date of the contract, at a
price set at the time of the contract. These contracts are
entered into in the interbank market conducted directly between
currency traders (typically commercial banks or other financial
institutions) and their customers.

Each of these Funds also may combine forward
currency
exchange contracts with investments in securities denominated
in other currencies.

Each of these Funds also may maintain short
positions
in forward currency exchange transactions, which would involve
it agreeing to exchange an amount of a currency it did not
currently own for another currency at a future date in
anticipation of a decline in the value of the currency sold
relative to the currency such Fund contracted to receive in the
exchange.

FUTURE DEVELOPMENTS--(Asset Allocation, Equity, Bond and
Municipal Bond Funds only) Each of these Funds may take
advantage of opportunities in the area of options and futures
contracts, options on futures contracts and any other
derivative investments which are not presently contemplated for
use by a Fund or which are not currently available but which
may be developed, to the extent such opportunities are both
consistent with a Fund's investment objective and legally
permissible for such Fund. Before entering into such
transactions or making any such investment, the Trust will
provide appropriate disclosure in its prospectus.

LENDING PORTFOLIO SECURITIES--From time to time, each Fund may
lend securities from its portfolio to brokers, dealers and
other financial institutions needing to borrow securities to
complete certain transactions. Such loans may not exceed 33-
1/3% of the value of a Fund's total assets. In connection with
such loans, a Fund will receive collateral consisting of cash,
U.S. Government securities or, except in the case of the U.S.
Government Money Market Fund, irrevocable letters of credit
which will be maintained at all times in an amount equal to at
least 100% of the current market value of the loaned
securities. Each Fund can increase its income through the
investment of such collateral. A Fund continues to be entitled
to payments in amounts equal to the interest, dividends and
other distributions payable on the loaned security and receives
interest on the amount of the loan. Such loans will be
terminable at any time upon specified notice. A Fund might
experience risk of loss if the institution with which it has
engaged in a portfolio loan transaction breaches its agreement
with such Fund.

FORWARD COMMITMENTS--Each Fund may purchase securities on a
when-issued or forward commitment basis, which means that the
price is fixed at the time of commitment, but delivery and
payment ordinarily take place a number of days after the date
of the commitment to purchase. A Fund will make commitments to
purchase such securities only with the intention of actually
acquiring the securities, but the Fund may sell these
securities before the settlement date if it is deemed
advisable. The Fund will not accrue income in respect of a
security purchased on a forward commitment basis prior to its
stated delivery date.

Securities purchased on a when-issued or forward
commitment basis and certain other securities held in a Fund's
portfolio are subject to changes in value (both generally
changing in the same way, i.e., appreciating when interest
rates decline and depreciating when interest rates rise) based
upon the public's perception of the creditworthiness of the
issuer and changes, real or anticipated, in the level of
interest rates. Securities purchased on a when-issued or
forward commitment basis may expose a Fund to risk because they
may experience such fluctuations prior to their actual
delivery. Purchasing securities on a when-issued or forward
commitment basis can involve the additional risk that the yield
available in the market when the delivery takes place actually
may be higher than that obtained in the transaction itself. A
segregated account of each Fund consisting of cash or U.S.
Government securities or other high quality liquid debt
securities of the type in which the Fund invests at least equal
at all times to the amount of the when-issued or forward
commitments will be established and maintained at the Trust's
custodian bank. Purchasing securities on a forward commitment
basis when a Fund is fully or almost fully invested may result
in greater potential fluctuation in the value of such Fund's
net assets and its net asset value per share.

BORROWING MONEY--As a fundamental policy, each Fund is
permitted to borrow to the extent permitted under the 1940 Act.
However, Intermediate Municipal Bond Fund, the Municipal Money
Market Fund and U.S. Government Money Market Fund currently
intend to borrow money only for temporary or emergency (not
leveraging) purposes, in an amount up to 15% of the value of
its total assets (including the amount borrowed) valued at the
lesser of cost or market, less liabilities (not including the
amount borrowed) at the time the borrowing is made. While
borrowings exceed 5% of such Fund's total assets, the Fund will
not make any additional investments.

<PAGE>

PRAIRIE FUNDS
CLASS A, CLASS B AND CLASS I SHARES
PART B (STATEMENT OF ADDITIONAL
INFORMATION)
__________, 1994

This Statement of Additional Information, which
is
not a prospectus, supplements and should be read in conjunction
with the current Prospectus for 12 separate portfolios (each, a
"Fund") of Prairie Funds (the "Trust"), dated _________, 1994,
as it may be revised from time to time. To obtain a copy of
the Trust's Prospectus, please write to the Trust at
________________________________________ or call toll free
1-800-________.

First Chicago Investment Management Company (the
"Investment Adviser" or "FIMCO") serves as each Fund's
investment adviser and administrator.

Concord Financial Group, Inc. (the
"Distributor")
serves as the distributor of the Funds' shares.

TABLE OF CONTENTS

Page

Investment Objectives and Management Policies . . . . . . .B-2
Management of the Trust. . . . . . . . . . . . . . . . . . B-18
Management Arrangements . . . . . . . . . . . . . . . . . .B-18
Purchase of Shares. . . . . . . . . . . . . . . . . . . . .B-20
Distribution Plan and Shareholder Services Plan . . . . . .B-21
Redemption of Shares. . . . . . . . . . . . . . . . . . . .B-22
Determination of Net Asset Value. . . . . . . . . . . . . .B-23
Portfolio Transactions. . . . . . . . . . . . . . . . . . .B-26
Dividends, Distributions and Taxes. . . . . . . . . . . . B-29
Performance Information . . . . . . . . . . . . . . . . . .B-31
Information About the Trust . . . . . . . . . . . . . . . .B-32
Counsel and Independent Auditors. . . . . . . . . . . . . .B-32
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . .B-33
Financial Statements. . . . . . . . . . . . . . . . . . . B-43
Report of Independent Auditors. . . . . . . . . . . . . . .B-__

<PAGE>
INVESTMENT OBJECTIVES AND
MANAGEMENT POLICIES

The following information supplements and should
be
read in conjunction with the section in the Trust's Prospectus
entitled "Description of the Funds."

Portfolio Securities

Bank Obligations. (Each Fund, except the U.S.
Government Money Market Fund) Domestic commercial banks
organized under Federal law are supervised and examined by the
Comptroller of the Currency and are required to be members of
the Federal Reserve System and to have their deposits insured
by the Federal Deposit Insurance Corporation (the "FDIC").
Domestic banks organized under state law are supervised and
examined by state banking authorities but are members of the
Federal Reserve System only if they elect to join. In
addition, state banks whose certificates of deposit ("CDs") may
be purchased by each Fund are insured by the FDIC (although
such insurance may not be of material benefit to a Fund,
depending on the principal amount of the CDs of each bank held
by such Fund) and are subject to Federal examination and to a
substantial body of Federal law and regulation. As a result of
Federal or state laws and regulations, domestic branches of
domestic banks whose CDs may be purchased by the Fund generally
are required, among other things, to maintain specified levels
of reserves, are limited in the amounts which they can loan to
a single borrower and are subject to other regulation designed
to promote financial soundness. However, not all of such laws
and regulations apply to the foreign branches of domestic
banks.

Obligations of foreign branches of domestic
banks,
foreign subsidiaries of domestic banks and domestic and foreign
branches of foreign banks, such as CDs and time deposits
("TDs"), may be general obligations of the parent banks in
addition to the issuing branch, or may be limited by the terms
of a specific obligation and governmental regulation. Such
obligations are subject to different risks than are those of
domestic banks. These risks include foreign economic and
political developments, foreign governmental restrictions that
may adversely affect payment of principal and interest on the
obligations, foreign exchange controls and foreign withholding
and other taxes on interest income. These foreign branches and
subsidiaries are not necessarily subject to the same or similar
regulatory requirements that apply to domestic banks, such as
mandatory reserve requirements, loan limitations, and
accounting, auditing and financial record keeping requirements.
In addition, less information may be publicly available about a
foreign branch of a domestic bank or about a foreign bank than
about a domestic bank.

Obligations of United States branches of foreign
banks may be general obligations of the parent bank in addition
to the issuing branch, or may be limited by the terms of a
specific obligation or by Federal or state regulation as well
as governmental action in the country in which the foreign bank
has its head office. A domestic branch of a foreign bank with
assets in excess of $1 billion may be subject to reserve
requirements imposed by the Federal Reserve System or by the
state in which the branch is located if the branch is licensed
in that state.

In addition, Federal branches licensed by the
Comptroller of the Currency and branches licensed by certain
states ("State Branches") may be required to: (1) pledge to
the regulator, by depositing assets with a designated bank
within the state, a certain percentage of their assets as fixed
from time to time by the appropriate regulatory authority; and
(2) maintain assets within the state in an amount equal to a
specified percentage of the aggregate amount of liabilities of
the foreign bank payable at or through all of its agencies or
branches within the state. The deposits of Federal and State
Branches generally must be insured by the FDIC if such branches
take deposits of less than $100,000.

In view of the foregoing factors associated with
the
purchase of CDs and TDs issued by foreign branches of domestic
banks, by foreign subsidiaries of domestic banks, by foreign
branches of foreign banks or by domestic branches of foreign
banks, the Investment Adviser carefully evaluates such
investments on a case-by-case basis.

Repurchase Agreements. The Trust's custodian or
sub-
custodian will have custody of, and will hold in a segregated
account, securities acquired by a Fund under a repurchase
agreement. Repurchase agreements are considered by the staff
of the Securities and Exchange Commission to be loans by the
Fund. In an attempt to reduce the risk of incurring a loss on
a repurchase agreement, each Fund will enter into repurchase
agreements only with domestic banks with total assets in excess
of one billion dollars, or primary government securities
dealers reporting to the Federal Reserve Bank of New York, with
respect to securities of the type in which the Fund may invest,
and will require that additional securities be deposited with
it if the value of the securities purchased should decrease
below the resale price. The Investment Adviser will monitor on
an ongoing basis the value of the collateral to assure that it
always equals or exceeds the repurchase price. The Trust will
consider on an ongoing basis the creditworthiness of the
institutions with which a Fund enters into repurchase
agreements.

Commercial Paper and Other Short-Term Corporate
Obligations. (Each Fund, except the U.S. Government Money
Market Fund) Variable rate demand notes include variable
amount master demand notes, which are obligations that permit a
Fund to invest fluctuating amounts at varying rates of interest
pursuant to direct arrangements between the Fund, as lender,
and the borrower. These notes permit daily changes in the
amounts borrowed. As mutually agreed between the parties, the
Fund may increase the amount under the notes at any time up to
the full amount provided by the note agreement, or decrease the
amount, and the borrower may repay up to the full amount of the
note without penalty. Because these obligations are direct
lending arrangements between the lender and borrower, it is not
contemplated that such instruments generally will be traded,
and there generally is no established secondary market for
these obligations, although they are redeemable at face value,
plus accrued interest, at any time. Accordingly, where these
obligations are not secured by letters of credit or other
credit support arrangements, a Fund's right to redeem is
dependent on the ability of the borrower to pay principal and
interest on demand. In connection with floating and variable
rate demand obligations, the Investment Adviser will consider,
on an ongoing basis, earning power, cash flow and other
liquidity ratios of the borrower, and the borrower's ability to
pay principal and interest on demand. Such obligations
frequently are not rated by credit rating agencies, and a Fund
may invest in them only if at the time of an investment the
borrower meets the criteria set forth in the Prospectus for
other commercial paper issuers.

Mortgage-Related Securities (Asset Allocation, Equity and Bond
Funds only)

Government Agency Securities. Mortgage-related
securities issued by the Government National Mortgage
Association ("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.

Government Related Securities. Mortgage-related
securities issued by the Federal National Mortgage Association
("FNMA") include FNMA Guaranteed Mortgage Pass-Through
Certificates (also known as "Fannie Maes") which are solely the
obligations of the FNMA and are not backed by or entitled to
the full faith and credit of the United States. The FNMA is a
government-sponsored organization owned entirely by private
stockholders. Fannie Maes are guaranteed as to timely payment
of principal and interest by FNMA.

Mortgage-related securities issued by the
Federal
Home Loan Mortgage Corporation ("FHLMC") include FHLMC Mortgage
Participation Certificates (also known as "Freddie Macs" or
"PCs"). The 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 timely payment of interest, which is guaranteed
by the FHLMC. The FHLMC guarantees either ultimate collection
or timely payment of all principal payments on the underlying
mortgage loans. When the FHLMC does not guarantee timely
payment of principal, FHLMC may remit the amount due on account
of its guarantee of ultimate payment of principal at any time
after default on an underlying mortgage, but in no event later
than one year after it becomes payable.

Municipal Obligations. (Asset, Allocation,
Equity,
Bond and Municipal Funds only) Municipal Obligations are
classified as general obligation bonds, revenue bonds and
notes. General obligation bonds are secured by the issuer's
pledge of its faith, credit and taxing power for the payment of
principal and interest. Revenue bonds are payable from the
revenue derived from a particular facility or class of
facilities or, in some cases, from the proceeds of a special
excise or other specific revenue source, but not from the
general taxing power. Industrial development bonds, in most
cases, are revenue bonds and generally do not carry the pledge
of the credit of the issuing municipality, but generally are
guaranteed by the corporate entity on whose behalf they are
issued. Notes are short-term instruments which are obligations
of the issuing municipalities or agencies and are sold in
anticipation of a bond sale, collection of taxes or receipt of
other revenues. Municipal Obligations include municipal
lease/purchase agreements which are similar to installment pur-
chase contracts for property or equipment issued by municipal-
ities. Certain Municipal Obligations are subject to redemption
at a date earlier than their stated maturity pursuant to call
options, which may be separated from the related Municipal
Obligation and purchased and sold separately. Each of these
Funds will invest in Municipal Obligations, the ratings of
which correspond with the ratings of other permissible Fund
investments.

For the purpose of diversification under the
Investment Company Act of 1940 (the "1940 Act"), the
identification of the issuer of Municipal Obligations depends
on the terms and conditions of the security. When the assets
and revenues of an agency, authority, instrumentality or other
political subdivision are separate from those of the government
creating the subdivision and the security is backed only by the
assets and revenues of the subdivision, such subdivision would
be deemed to be the sole issuer. Similarly, in the case of an
industrial development bond, if that bond is backed only by the
assets and revenues of the non-governmental user, then such
non-governmental user would be deemed to be the sole issuer.
If, however, in either case, the creating government or some
other entity guarantees a security, such a guaranty would be
considered a separate security and will be treated as an issue
of such government or other entity.

The yields on Municipal Obligations are
dependent on
a variety of factors, including general economic and monetary
conditions, money market factors, conditions in the Municipal
Obligations market, size of a particular offering, maturity of
the obligation, and rating of the issue. The imposition of the
Fund's management fee, as well as other operating expenses,
will have the effect of reducing the yield to investors.

Municipal lease obligations or installment
purchase
contract obligations (collectively, "lease obligations") have
special risks not ordinarily associated with Municipal
Obligations. Although lease obligations do not constitute
general obligations of the municipality for which the
municipality's taxing power is pledged, a lease obligation
ordinarily is backed by the municipality's covenant to budget
for, appropriate and make the payments due under the lease
obligation. However, certain lease obligations contain "non-
appropriation" clauses which provide that the municipality has
no obligation to make lease or installment purchase payments in
future years unless money is appropriated for such purpose on a
yearly basis. Although "non-appropriation" lease obligations
are secured by the leased property, disposition of the property
in the event of foreclosure might prove difficult. The
Municipal Money Market Fund will seek to minimize these risks
by investing only in those lease obligations that (1) are rated
in one of the two highest categories for debt obligations by at
least two nationally recognized statistical rating
organizations (or one rating organization if the lease
obligation was rated by only one such organization); or (2) if
unrated, are purchased principally from the issuer or domestic
banks or other responsible third parties, in each case only if
the seller shall have entered into an agreement with the
Municipal Money Market Fund providing the seller or other
responsible third party will either remarket or repurchase the
lease obligations within a short period after demand by the
Fund. With respect to the Intermediate Municipal Bond Fund,
the Board has established guidelines for the Investment Adviser
to determine the liquidity and appropriate valuation of lease
obligations based on factors which include: (1) the frequency
of trades and quotes for the lease obligation or similar
securities; (2) the number of dealers willing to purchase or
sell the lease obligation or similar securities and the number
of other potential buyers; (3) the willingness of dealers to
undertake to make a market in the security or similar
securities; and (4) the nature of the marketplace trades,
including the time needed to dispose of the security, the
method of soliciting offers, and the mechanics of transfer.
Not more than 15% (10% in the case of the Municipal Money
Market Fund) of the value of the Fund's net assets will be
invested in lease obligations that are illiquid and in other
illiquid securities. See "Investment Restriction No. 11"
below.

The Intermediate Municipal Bond Fund will
purchase
tender option bonds only when it is satisfied that the
custodial and tender option arrangements, including the fee
payment arrangements, will not adversely affect the tax exempt
status of the underlying Municipal Obligations and that payment
of any tender fees will not have the effect of creating taxable
income for the Fund. Based on the tender option bond
agreement, the Trust expects to be able to value the tender
option bond at par; however, the value of the instrument will
be monitored to assure that is valued at fair value.

The Municipal Money Market Fund will not
purchase
tender option bonds unless (a) the demand feature applicable
thereto is exercisable by the Fund within 13 months of the date
of such purchase upon no more than 30 days' notice and
thereafter is exercisable by the Fund no less frequently than
annually upon no more than 30 days' notice and (b) at the time
of such purchase, the Investment Adviser reasonably expects (i)
based upon its assessment of current and historical interest
rate trends, that prevailing short-term tax exempt rates will
not exceed the stated interest rate on the underlying Municipal
Obligations at the time of the next tender option to terminate
the tender option would not occur prior to the time of the next
tender opportunity. At the time of each tender opportunity,
the Fund will exercise the tender option with respect to any
tender option bonds unless the Investment Adviser reasonably
expects, (x) based upon its assessment of current and
historical interest rate trends, that prevailing short-term tax
exempt rates will not exceed the stated interest rate on the
underlying Municipal Obligations at the time of the next tender
fee adjustment, and (y) that the circumstances which might
entitle the grantor of a tender option to terminate the tender
option would not occur prior to the time of the next tender
opportunity. The Municipal Money Market Fund will exercise the
tender feature with respect to tender option bonds, or
otherwise dispose of its tender option bonds, prior to the time
the tender option is scheduled to expire pursuant to the terms
of the agreement under which the tender option is granted. The
Municipal Money Market Fund otherwise will comply with the
provisions of Rule 2a-7 in connection with the purchase of
tender option bonds, including, without limitation, the
requisite determination by the Board of Trustees that the
tender option bonds in question meet the quality standards
described in Rule 2a-7, which, in the case of a tender option
bond subject to a conditional demand feature, would include a
determination that the security has received both the required
short-term and long-term quality rating or is determined to be
of comparable quality. In the event of a default of the
Municipal Obligation underlying a tender option bond, or the
termination of the tender option agreement, the Municipal Money
Market Fund would look to the maturity date of the underlying
security for purposes of compliance with Rule 2a-7 and, if its
remaining maturity was greater than 13 months, the Fund would
sell the security as soon as would be practicable. The
Municipal Money Market Fund will purchase tender option bonds
only when it is satisfied that the custodial and tender option
arrangements, including the fee payment arrangements, will not
adversely affect the tax exempt status of the underlying
Municipal Obligations and that payment of any tender fees will
not have the effect of creating taxable income for the Fund.
Based on the tender option bond agreement, the Municipal Money
Market Fund expects to be able to value the tender option bond
at par; however, the value of the instrument will be monitored
to assure that it is valued at fair value.

If, subsequent to its purchase by the Municipal
Money
Market Fund, (a) an issue of rated Municipal Obligations ceases
to be rated in the highest rating category by at least two
ratings organizations (or one rating organization if the
instrument was rated by only one such organization), or the
Trust's Board determines that it is no longer of comparable
quality; or (b) the Investment Adviser becomes aware that any
portfolio security not so highly rated or any unrated security
has been given a rating by any rating organization below the
rating organization's second highest rating category, the
Trust's Board will reassess promptly whether such security
presents minimal credit risk and will cause the Fund to take
such action as it determines is in the best interest of the
Fund and its shareholders, provided that the reassessment
required by clause (b) is not required if the portfolio
security is disposed of or matures within five business days of
the Investment Adviser becoming aware of the new rating and the
Trust's Board is subsequently notified of the Investment
Adviser's actions.

To the extent that the ratings given by Moody's
Investors Service, Inc. ("Moody's"), Standard & Poor's
Corporation ("S&P") or Fitch Investors Service Inc. ("Fitch")
for Municipal Obligations may change as a result of changes in
such organizations or their rating systems, the Municipal Money
Market Fund will attempt to use comparable ratings as standards
for its investments in accordance with the investment policies
contained in the Trust's Prospectus and this Statement of
Additional Information. The ratings of Moody's, S&P and Fitch
represent their opinions as to the quality of the Municipal
Obligations which they undertake to rate. It should be
emphasized, however, that ratings are relative and subjective
and are not absolute standards of quality. Although these
ratings may be an initial criterion for selection of portfolio
investments, the Investment Adviser will also evaluate these
securities and the creditworthiness of the issuers of such
securities.

Convertible Securities. (Asset Allocation,
Equity
and Bond Funds only) In general, the market value of a
convertible security is the higher of its "investment value"
(i.e., its value as a fixed-income security) or its "conversion
value" (i.e., the value of the underlying shares of common
stock if the security is converted). As a fixed-income
security, the market value of a convertible security generally
increases when interest rates decline and generally decreases
when interest rates rise. However, the price of a convertible
security also is influenced by the market value of the
security's underlying common stock. Thus, the price of a
convertible security generally increases as the market value of
the underlying stock increases, and generally decreases as the
market value of the underlying stock declines. Investments in
convertible securities generally entail less risk than
investments in the common stock of the same issuer.

Illiquid Securities. When purchasing securities
that
have not been registered under the Securities Act of 1933, as
amended, and are not readily marketable, the Trust will
endeavor to obtain the right to registration at the expense of
the issuer. Generally, there will be a lapse of time between a
Fund's decision to sell any such security and the registration
of the security permitting sale. During any such period, the
price of the securities will be subject to market fluctuations.
However, if a substantial market of qualified institutional
buyers develops pursuant to Rule 144A under the Securities Act
of 1933, as amended, for certain unregistered securities held
by a Fund, such Fund intends to treat them as liquid securities
in accordance with procedures approved by the Trust's Board of
Trustees. Because it is not possible to predict with assurance
how the market for restricted securities pursuant to Rule 144A
will develop, the Trust's Board of Trustees has directed the
Investment Adviser to monitor carefully each Fund's investments
in such securities with particular regard to trading activity,
availability of reliable price information and other relevant
information. To the extent that, for a period of time,
qualified institutional buyers cease purchasing restricted
securities pursuant to Rule 144A, a Fund's investing in such
securities may have the effect of increasing the level of
illiquidity in such Fund during such period.

Management Policies

Options Transactions. (Asset Allocation, Equity
and
Bond Funds only) Each of these Funds may engage in options
transactions, such as purchasing or writing covered call or put
options. The principal reason for writing covered call options
is to realize, through the receipt of premiums, a greater
return than would be realized on a Fund's securities alone. In
return for a premium, the writer of a covered call option
forfeits the right to any appreciation in the value of the
underlying security above the strike price for the life of the
option (or until a closing purchase transaction can be
effected). Nevertheless, the call writer retains the risk of a
decline in the price of the underlying security. Similarly,
the principal reason for writing covered put options is to
realize income in the form of premiums. The writer of a
covered put option accepts the risk of a decline in the price
of the underlying security. The size of the premiums that a
Fund may receive may be adversely affected as new or existing
institutions, including other investment companies, engage in
or increase their option-writing activities.

Options written ordinarily will have expiration
dates
between one and nine months from the date written. The
exercise price of the options may be below, equal to or above
the market values of the underlying securities at the time the
options are written. In the case of call options, these
exercise prices are referred to as "in-the-money," "at-the-
money" and "out-of-the-money," respectively. Each Fund may
write (a) in-the-money call options when the Investment Adviser
expects that the price of the underlying security will remain
stable or decline moderately during the option period, (b) at-
the-money call options when the Investment Adviser expects that
the price of the underlying security will remain stable or
advance moderately during the option period and (c) out-of-the-
money call options when the Investment Adviser expects that the
premiums received from writing the call option plus the
appreciation in market price of the underlying security up to
the exercise price will be greater than the appreciation in the
price of the underlying security alone. In these
circumstances, if the market price of the underlying security
declines and the security is sold at this lower price, the
amount of any realized loss will be offset wholly or in part by
the premium received. Out-of-the-money, at-the-money and in-
the-money put options (the reverse of call options as to the
relation of exercise price to market price) may be utilized in
the same market environments that such call options are used in
equivalent transactions.

So long as a Fund's obligation as the writer of
an
option continues, such Fund may be assigned an exercise notice
by the broker-dealer through which the option was sold,
requiring the Fund to deliver, in the case of a call, or take
delivery of, in the case of a put, the underlying security
against payment of the exercise price. This obligation
terminates when the option expires or a Fund effects a closing
purchase transaction. A Fund can no longer effect a closing
purchase transaction with respect to an option once it has been
assigned an exercise notice.

While it may choose to do otherwise, each Fund
generally will purchase or write only those options for which
the Investment Adviser believes there is an active secondary
market so as to facilitate closing transactions. There is no
assurance that sufficient trading interest to create a liquid
secondary market on a securities exchange will exist for any
particular option or at any particular time, and for some
options no such secondary market may exist. A liquid secondary
market in an option may cease to exist for a variety of
reasons. In the past, for example, higher than anticipated
trading activity or order flow, or other unforeseen events, at
times have rendered certain clearing facilities inadequate and
resulted in the institution of special procedures, such as
trading rotations, restrictions on certain types of orders or
trading halts or suspensions in one or more options. There can
be no assurance that similar events, or events that otherwise
may interfere with the timely execution of customers' orders,
will not recur. In such event, it might not be possible to
effect closing transactions in particular options. If as a
covered call option writer a Fund is unable to effect a closing
purchase transaction in a secondary market, it will not be able
to sell the underlying security until the option expires or it
delivers the underlying security upon exercise or it otherwise
covers its position.

Stock Index Options. (Asset Allocation and
Equity
Funds only) Each of these Funds may purchase and write put and
call options on stock indexes listed on a securities exchange
or traded in the over-the-counter market. A stock index
fluctuates with changes in the market values of the stocks
included in the index.

Options on stock indexes are similar to options
on
stock except that (a) the expiration cycles of stock index
options are generally monthly, while those of stock options are
currently quarterly, and (b) the delivery requirements are
different. Instead of giving the right to take or make
delivery of a stock at a specified price, an option on a stock
index gives the holder the right to receive a cash "exercise
settlement amount" equal to (i) the amount, if any, by which
the fixed exercise price of the option exceeds (in the case of
a put) or is less than (in the case of a call) the closing
value of the underlying index on the date of exercise,
multiplied by (ii) a fixed "index multiplier." Receipt of this
cash amount will depend upon the closing level of the stock
index upon which the option is based being greater than, in the
case of a call, or less than, in the case of a put, the
exercise price of the option. The amount of cash received will
be equal to such difference between the closing price of the
index and the exercise price of the option expressed in dollars
times a specified multiple. The writer of the option is
obligated, in return for the premium received, to make delivery
of this amount. The writer may offset its position in stock
index options prior to expiration by entering into a closing
transaction on an exchange or it may let the option expire
unexercised.

Futures Contracts and Options on Futures
Contracts.
(Asset Allocation, Equity, Bond and Municipal Bond Funds Only)
Each of these Funds may trade futures contracts and options on
futures contracts in U.S. domestic markets, such as the Chicago
Board of Trade and the International Monetary Market of the
Chicago Mercantile Exchange, or, to the extent permitted under
applicable law, on exchanges located outside the United States,
such as the London International Financial Futures Exchange and
the Sydney Futures Exchange Limited. Foreign markets may offer
advantages such as trading in commodities that are not
currently traded in the United States or arbitrage
possibilities not available in the United States.

Each of these Funds' commodities transactions
must
constitute bona fide hedging or other permissible transactions
pursuant to regulations promulgated by the Commodity Futures
Trading Commission (the "CFTC"). In addition, a Fund may not
engage in such transactions if the sum of the amount of initial
margin deposits and premiums paid for unexpired commodity
options, other than for bona fide hedging transactions, would
exceed 5% of the liquidation value of the Fund's assets, after
taking into account unrealized profits and unrealized losses on
such contracts it has entered into; provided, however, that in
the case of an option that is in-the-money at the time of
purchase, the in-the-money amount may be excluded in
calculating the 5%. To the extent a Fund engages in the use of
futures and options on futures for other than bona fide hedging
purposes, the Fund may be subject to additional risk.

Initially, when purchasing or selling futures
contracts a Fund will be required to deposit with the Trust's
custodian in the broker's name an amount of cash or cash
equivalents up to approximately 10% of the contract amount.
This amount is subject to change by the exchange or board of
trade on which the contract is traded and members of such
exchange or board of trade may impose their own higher
requirements. This amount is known as "initial margin" and is
in the nature of a performance bond or good faith deposit on
the contract which is returned to the Fund upon termination of
the futures position, assuming all contractual obligations have
been satisfied. Subsequent payments, known as "variation
margin," to and from the broker will be made daily as the price
of the index or securities underlying the futures contract
fluctuates, making the long and short positions in the futures
contract more or less valuable, a process known as "marking-to-
market." At any time prior to the expiration of a futures
contract, the Fund may elect to close the position by taking an
opposite position, at the then prevailing price, which will
operate to terminate the Fund's existing position in the
contract.

Although each of these Funds intends to purchase
or
sell futures contracts only if there is an active market for
such contracts, no assurance can be given that a liquid market
will exist for any particular contract at any particular time.
Many futures exchanges and boards of trade limit the amount of
fluctuation permitted in futures contract prices during a
single trading day. Once the daily limit has been reached in a
particular contract, no trades may be made that day at a price
beyond that limit or trading may be suspended for specified
periods during the trading day. Futures contract prices could
move to the limit for several consecutive trading days with
little or no trading, thereby preventing prompt liquidation of
futures positions and potentially subjecting a Fund to
substantial losses. If it is not possible, or the Fund
determines not, to close a futures position in anticipation of
adverse price movements, the Fund will be required to make
daily cash payments of variation margin. In such
circumstances, an increase in the value of the portion of the
portfolio being hedged, if any, may offset partially or
completely losses on the futures contract. However, no
assurance can be given that the price of the securities being
hedged will correlate with the price movements in a futures
contract and thus provide an offset to losses on the futures
contract.

In addition, to the extent a Fund is engaging in
a
futures transaction as a hedging device, due to the risk of an
imperfect correlation between securities owned by the Fund that
are the subject of a hedging transaction and the futures
contract used as a hedging device, it is possible that the
hedge will not be fully effective in that, for example, losses
on the portfolio securities may be in excess of gains on the
futures contract or losses on the futures contract may be in
excess of gains on the portfolio securities that were the
subject of the hedge. In futures contracts based on indexes,
the risk of imperfect correlation increases as the composition
of a Fund's investments varies from the composition of the
index. In an effort to compensate for the imperfect
correlation of movements in the price of the securities being
hedged and movements in the price of futures contracts, the
Fund may buy or sell futures contracts in a greater or lesser
dollar amount than the dollar amount of the securities being
hedged if the historical volatility of the futures contract has
been less or greater than that of the securities. Such "over
hedging" or "under hedging" may adversely affect a Fund's net
investment results if market movements are not as anticipated
when the hedge is established.

Upon exercise of an option, the writer of the
option
will deliver to the holder of the option the futures position
and the accumulated balance in the writer's futures margin
account, which represents the amount by which the market price
of the futures contract exceeds, in the case of a call, or is
less than, in the case of a put, the exercise price of the
option on the futures contract. The potential loss related to
the purchase of options on futures contracts is limited to the
premium paid for the option (plus transaction costs). Because
the value of the option is fixed at the time of sale, there are
no daily cash payments to reflect changes in the value of the
underlying contract; however, the value of the option does
change daily and that change would be reflected in the net
asset value of each Fund.

Foreign Currency Transactions. (Asset
Allocation,
Growth, International Equity, Special Opportunities and
International Bond Funds only) If a Fund enters into a currency
transaction, it will deposit, if so required by applicable
regulations, with its custodian cash or readily marketable
securities in a segregated account of the Fund in an amount at
least equal to the value of the Fund's total assets committed
to the consummation of the forward contract. If the value of
the securities placed in the segregated account declines,
additional cash or securities will be placed in the account so
that the value of the account will equal the amount of the
Fund's commitment with respect to the contract.

At or before the maturity of a forward contract,
the
Fund either may sell a security and make delivery of the
currency, or retain the security and offset its contractual
obligation to deliver the currency by purchasing a second
contract pursuant to which the Fund will obtain, on the same
maturity date, the same amount of the currency which it is
obligated to deliver. If the Fund retains the portfolio
security and engages in an offsetting transaction, such Fund,
at the time of execution of the offsetting transaction, will
incur a gain or loss to the extent movement has occurred in
forward contract prices. Should forward prices decline during
the period between the Fund's entering into a forward contract
for the sale of a currency and the date it enters into an
offsetting contract for the purchase of the currency, the Fund
will realize a gain to the extent the price of the currency it
has agreed to sell exceeds the price of the currency it has
agreed to purchase. Should forward prices increase, the Fund
will suffer a loss to the extent the price of the currency it
has agreed to purchase exceeds the price of the currency it has
agreed to sell.

The cost to each of these Funds of engaging in
currency transactions varies with factors such as the currency
involved, the length of the contract period and the market
conditions then prevailing. Because transactions in currency
exchange usually are conducted on a principal basis, no fees or
commissions are involved. The use of forward currency exchange
contracts does not eliminate fluctuations in the underlying
prices of the securities, but it does establish a rate of
exchange that can be achieved in the future. If a devaluation
generally is anticipated, a Fund may not be able to contract to
sell the currency at a price above the devaluation level it
anticipates. The requirements for qualification as a regulated
investment company under the Internal Revenue Code of 1986, as
amended (the "Code"), may cause the Fund to restrict the degree
to which each Fund engages in currency transactions. See
"Dividends, Distributions and Taxes."

Lending Portfolio Securities. To a limited
extent,
each Fund may lend its portfolio securities to brokers, dealers
and other financial institutions, provided it receives cash
collateral which at all times is maintained in an amount equal
to at least 100% of the current market value of the securities
loaned. By lending its portfolio securities, a Fund can
increase its income through the investment of the cash
collateral. For purposes of this policy, a Fund considers
collateral consisting of U.S. Government securities or, except
in the case of the U.S. Government Money Market Fund,
irrevocable letters of credit issued by banks whose securities
meet the standards for investment by such Fund to be the
equivalent of cash. From time to time, a Fund may return to
the borrower or a third party which is unaffiliated with such
Fund, and which is acting as a "placing broker," a part of the
interest earned from the investment of collateral received for
securities loaned.

The Securities and Exchange Commission currently
requires that the following conditions must be met whenever
portfolio securities are loaned: (1) the Fund must receive at
least 100% cash collateral from the borrower; (2) the borrower
must increase such collateral whenever the market value of the
securities rises above the level of such collateral; (3) the
Fund must be able to terminate the loan at any time; (4) the
Fund must receive reasonable interest on the loan, as well as
any dividends, interest or other distributions payable on the
loaned securities, and any increase in market value; (5) the
Fund may pay only reasonable custodian fees in connection with
the loan; and (6) while voting rights on the loaned securities
may pass to the borrower, the Trust's Board of Trustees must
terminate the loan and regain the right to vote the securities
if a material event adversely affecting the investment occurs.
These conditions may be subject to future modification.

Investment Restrictions

Each Fund has adopted investment restrictions
numbered 1 through 7 as fundamental policies. In addition, the
Money Market Fund has adopted investment restrictions numbered
14 and 15, the Municipal Funds have adopted investment
restriction number 16 and the Diversified Funds, other than the
Money Market and Municipal Funds, have adopted investment
restrictions number 17, 18 and 19 as additional fundamental
policies. These restrictions cannot be changed, as to a Fund,
without approval by the holders of a majority (as defined in
the 1940 Act) of such Fund's outstanding voting shares.
Investment restrictions numbered 8 through 13 are not
fundamental policies and may be changed by vote of a majority
of the Trust's Trustees at any time. No Fund may:

1. Invest in commodities, except that each
Fund may
purchase and sell options, forward contracts, futures
contracts, including those relating to indexes, and
options on futures contracts or indexes.

2. Purchase, hold or deal in real estate,
or oil,
gas or other mineral leases or exploration or
development
programs, but each Fund may purchase and sell securities
that are secured by real estate or issued by companies
that invest or deal in real estate.

3. Borrow money, except to the extent
permitted
under the 1940 Act. For purposes of this investment
restriction, a Fund's entry into options, forward
contracts, futures contracts, including those relating
to
indexes, and options on futures contracts or indexes
shall
not constitute borrowing.

4. Make loans to others, except through
the
purchase of debt obligations and the entry into
repurchase
agreements. However, each Fund may lend its securities
in
an amount not to exceed 33-1/3% of the value of its
total
assets. Any loans of portfolio securities will be made
according to guidelines established by the Securities
and
Exchange Commission and the Trust's Board of Trustees.

5. Act as an underwriter of securities of
other
issuers, except to the extent a Fund may be deemed an
underwriter under the Securities Act of 1933, as
amended,
by virtue of disposing of portfolio securities, and
except
that the Fund may bid separately or as part of a group
for
the purchase of Municipal Obligations directly from an
issuer for its own portfolio to take advantage of the
lower purchase price available.

6. Issue any senior security (as such term
is
defined in Section 18(f) of the 1940 Act), except to the
extent the activities permitted under Investment
Restriction Nos. 1, 3, 9 and 10 may be deemed to give
rise
to senior securities.

7. Purchase securities on margin, but each
Fund may
make margin deposits in connection with transactions in
options, forward contracts, futures contracts, including
those relating to indexes, and options on futures
contracts or indexes.

8. Invest in the securities of a company for
the
purpose of exercising management or control, but each
Fund
will vote the securities it owns in its portfolio as a
shareholder in accordance with its views.

9. Pledge, mortgage or hypothecate its
assets,
except to the extent necessary to secure permitted
borrowings and to the extent related to the deposit of
assets in escrow in connection with writing covered put
and call options and the purchase of securities on a
when-
issued or forward commitment basis and collateral and
initial or variation margin arrangements with respect to
options, forward contracts, futures contracts, including
those relating to indexes, and options on futures
contracts or indexes.

10. Purchase, sell or write puts, calls or
combinations thereof, except as described in the Trust's
Prospectus and this Statement of Additional Information.

11. Enter into repurchase agreements providing
for
settlement in more than seven days after notice or
purchase securities which are illiquid, if, in the
aggregate, more than 15% (10% in the case of a Money
Market Fund) of the value of the Fund's net assets would
be so invested.

12. Invest in securities of other investment
companies, except to the extent permitted under the Act.

13. Purchase securities of any company having
less
than three years' continuous operations (including
operations of any predecessors) if such purchase would
cause the value of the Fund's investments in all such
companies to exceed 5% of the value of its total assets.

The following investment restrictions numbered
14 and
15 apply only to the Money Market Fund. The Money Market Fund
may not:

14. Invest more than 5% of its assets in the
obligations of any one issuer, except that up to 25% of
the value of the Money Market Fund's total assets may be
invested (subject to Rule 2a-7 under the 1940 Act)
without
regard to any such limitation.

15. Invest less than 25% of its total assets in
securities issued by banks or invest more than 25% of
its
assets in the securities of issuers in any other
industry,
provided that there shall be no limitation on the
purchase
of obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.
Notwithstanding the foregoing, for temporary defensive
purposes, the Money Market Fund may invest less than 25%
of its total assets in bank obligations.

The following investment restriction number 16
applies only to the Municipal Funds. None of these Funds may:

16. Invest more than 25% of its total assets in
the
securities of issuers in any single industry, provided
that there shall be no such limitation on the purchase
of
Municipal Obligations and, for temporary defensive
purposes, obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.

The following investment restriction numbers 17,
18
and 19 apply only to the Diversified Funds, other than the
Money Market and Municipal Funds. None of these Funds may:

17. Invest more than 5% of its assets in the
obligations of any single issuer, except that up to 25%
of
the value of the Fund's total assets may be invested,
and
securities issued or guaranteed by the U.S. Government,
or
its agencies or instrumentalities may be purchased,
without regard to any such limitation.

18. Hold more than 10% of the outstanding
voting
securities of any single issuer. This Investment
Restriction applies only with respect to 75% of the
Fund's
total assets.

19. Invest more than 25% of its assets in the
securities of issuers in any single industry, except
that,
there shall be no limitation on the purchase of
obligations issued or guaranteed by the U.S. Government,
its agencies or instrumentalities.

For purposes of Investment Restriction No. 16,
industrial development bonds, where the payment of principal
and interest is the ultimate responsibility of companies within
the same industry, are grouped together as an "industry."

If a percentage restriction is adhered to at the
time
of investment, a later increase or decrease in percentage
resulting from a change in values or assets will not constitute
a violation of such restriction.

The Trust may make commitments more restrictive
than
the restrictions listed above so as to permit the sale of Fund
shares in certain states. Should the Trust determine that a
commitment is no longer in the best interests of a Fund and its
shareholders, the Trust reserves the right to revoke the
commitment by terminating the sale of such Fund's shares in the
state involved.

MANAGEMENT OF THE
TRUST

Trustees and officers of the Trust, together
with
information as to their principal business occupations during
at least the last five years, are shown below. Each Trustee
who is deemed to be an "interested person" of the Trust, as
defined in the 1940 Act, is indicated by an asterisk.

Trustees and Officers of the Trust

[TO BE PROVIDED]

For so long as a plan described in the section
captioned "Distribution, Shareholder Services and Service
Plans" remains in effect, the Trustees of the Trust who are not
"interested persons" of the Trust, as defined in the 1940 Act,
will be selected and nominated by the Trustees who are not
"interested persons" of the Trust.

Officers of the Trust Not Listed Above

[TO BE PROVIDED]

MANAGEMENT
ARRANGEMENTS

The following information supplements and should
be
read in conjunction with the section in the Prospectus entitled
"Management of the Trust."

Investment Advisory Agreement. FIMCO provides
investment advisory services pursuant to the Investment
Advisory Agreement (the "Agreement") dated _____________, 1994,
with the Trust. As to each Fund, the Agreement is subject to
annual approval by (i) the Trust's Board of Trustees or (ii)
vote of a majority (as defined in the 1940 Act) of the
outstanding voting securities of such Fund, provided that in
either event the continuance also is approved by a majority of
the Trustees who are not "interested persons" (as defined in
the 1940 Act) of the Trust or FIMCO, by vote cast in person at
a meeting called for the purpose of voting on such approval.
As to each Fund, the Agreement is terminable without penalty,
on 60 days' notice, by the Trust's Board of Trustees or by vote
of the holders of a majority of such Fund's shares, or, on not
less than 90 days' notice, by FIMCO. The Agreement will
terminate automatically, as to the relevant Fund, in the event
of its assignment (as defined in the 1940 Act).

FIMCO is responsible for investment decisions
for
each Fund in accordance with the stated policies of such Fund,
subject to the approval of the Trust's Board of Trustees. All
purchases and sales are reported for the Trustees' review at
the meeting subsequent to such transactions.

The following persons are officers and/or
directors
of FIMCO: __________________.

Sub-Investment Advisory Agreement. ANB
Investment
Management and Trust Company ("ANB-IMC") provides investment
advisory assistance and day-to-day management of the
International Equity Fund's investments pursuant to the Sub-
Investment Advisory Agreement dated _____________, 1994 between
ANB-IMC and FIMCO. The Sub-Investment Advisory Agreement is
subject to annual approval by (i) the Trust's Board or (ii)
vote of a majority (as defined in the Act) of the International
Equity Fund's outstanding voting securities, provided that in
either event the continuance also is approved by a majority of
Trustees who are not "interested persons" (as defined in the
Act) of the Trust or ANB-IMC, by vote cast in person at a
meeting called for the purpose of voting on such approval. The
Sub-Investment Advisory Agreement is terminable without
penalty, (i) by FIMCO on 60 days' notice, (ii) by the Trust's
Board or by vote of the holders of a majority of the Fund's
outstanding voting securities on 60 days' notice, or (iii) upon
not less than 90 days' notice, by ANB-IMC. The Sub-Investment
Advisory Agreement will terminate automatically in the event of
its assignment (as defined in the Act).

ANB-IMC provides day-to-day management of the
International Equity Fund's investments, subject to the
supervision of FIMCO and the Trust's Board. The fees payable
to ANB-IMC for its services are paid by FIMCO.

The following persons are officers and/or
directors
of ANB-IMC: _____________________________________________.

Administration and Sub-Administration
Agreements.
Pursuant to an Administration Agreement dated ______________,
1994 with the Trust, FIMCO assists in all aspects of the
Trust's operations, other than providing investment advice,
subject to the overall authority of the Trust's Board in
accordance with Massachusetts law. FIMCO has engaged Concord
Holding Corporation (the "Sub-Administrator") to assist it in
providing certain administrative services to the Trust.
Pursuant to its agreement with FIMCO (the "Sub-Administration
Agreement"), the Administrator assists FIMCO in furnishing the
Trust clerical help and accounting, data processing,
bookkeeping, internal auditing and legal services and certain
other services required by the Trust, preparing reports to the
funds' shareholders, tax returns, reports to and filings with
the Securities and Exchange Commission and state Blue Sky
authorities, calculating the net asset value of each Fund's
shares and generally in providing for all aspects of the
Trust's operation, other than providing investment advice. The
fees payable to the Sub-Administrator for its services are paid
by FIMCO.

The Fund has agreed that FIMCO, ANB-IMC and the
Sub-Administrator will not be liable for any error of judgment
or mistake of law or for any loss suffered by the Trust in
connection with the matters to which respective agreements
relate, except for a loss resulting from wilful misfeasance,
bad faith or gross negligence on the part of FIMCO in the
performance of its obligations or from reckless disregard by it
of its obligations and duties under its Agreements or on the
part of ANB-IMC or the Sub-Administrator in the performance of
their respective obligations or from reckless disregard by
either of its obligations and duties under its agreement.

Expenses and Expense Information. All expenses
incurred in the operation of the Trust are borne by the Trust,
except to the extent specifically assumed by FIMCO. The
expenses borne by the Trust include: organizational costs,
taxes, interest, brokerage fees and commissions, if any, fees
of Board members, Securities and Exchange Commission fees,
state Blue Sky qualification fees, advisory fees, charges of
custodians, transfer and dividend disbursing agents' fees,
certain insurance premiums, industry association fees, outside
auditing and legal expenses, costs of maintaining the Trust's
existence, costs of independent pricing services, costs
attributable to investor services (including, without
limitation, telephone and personnel expenses), costs of
shareholders' reports and meetings, costs of preparing and
printing prospectuses and statements of additional information
for regulatory purposes and for distribution to existing
shareholders, and any extraordinary expenses. In addition,
Class A and Class B are subject to an annual distribution
and/or service fee. Expenses attributable to a particular Fund
or Class are charged against the assets of that Fund or Class,
respectively; other expenses of the Trust are allocated among
the Funds on the basis determined by the Board of Trustees,
including, but not limited to, proportionately in relation to
the net assets of each Fund.

The Agreement provides that if, in any fiscal
year,
the aggregate expenses of a Fund, exclusive of taxes,
brokerage, interest on borrowings and (with the prior written
consent of the necessary state securities commissions)
extraordinary expenses, but including the advisory fee, exceed
the expense limitation of any state having jurisdiction over
the Fund, the Trust may deduct from the payment to be made to
FIMCO under the Agreement, or FIMCO will bear, such excess
expense to the extent required by state law. Such deduction or
payment, if any, will be estimated daily, and reconciled and
effected or paid, as the case may be, on a monthly basis.

The aggregate of the fees payable to FIMCO is
not
subject to reduction as the value of a Fund's net assets
increases.

PURCHASE OF SHARES

The following information supplements and should
be
read in conjunction with the section in the Trust's Prospectus
entitled "How to Buy Shares."

The Distributor. The Distributor serves as the
Trust's distributor pursuant to an agreement which is renewable
annually.

Using Federal Funds. The Shareholder Services
Group,
Inc., the Fund's transfer and dividend disbursing agent (the
"Transfer Agent"), or the Trust may attempt to notify the
investor upon receipt of checks drawn on banks that are not
members of the Federal Reserve System as to the possible delay
in conversion into Federal Funds and may attempt to arrange for
a better means of transmitting the money. If the investor is a
customer of a securities dealer, bank or other financial
institution and his order to purchase Fund shares is paid for
other than in Federal Funds, the securities dealer, bank or
other financial institution, acting on behalf of its customer,
generally will complete the conversion into, or itself advance,
Federal Funds on the business day following receipt of the
customer order. The order is effective only when so converted
and received by the Transfer Agent. An order for the purchase
of Fund shares placed by an investor with a sufficient Federal
Funds or cash balance in his brokerage account with a
securities dealer, bank or other financial institution will
become effective on the day that the order, including Federal
Funds, is received by the Transfer Agent. In some states,
banks or other institutions effecting transactions in Fund
shares may be required to register as dealers pursuant to state
law.

DISTRIBUTION PLAN AND SHAREHOLDER
SERVICES PLAN

The following information supplements and should
be
read in conjunction with the section in the Trust's Prospectus
entitled "Distribution Plan and Shareholder Services Plan."

Distribution Plan. Rule 12b-1 (the "Rule")
adopted
by the Securities and Exchange Commission under the 1940 Act
provides, among other things, that an investment company may
bear expenses of distributing its shares only pursuant to a
plan adopted in accordance with the Rule. The Trust's Board
has adopted such a plan with respect to Class B shares of each
Fund (the "Plan"). The Trust's Board believes that there is a
reasonable likelihood that the Plan will benefit each Fund and
the holders of its Class B shares.

A quarterly report of the amounts expended under
each
Plan, and the purposes for which such expenditures were
incurred, must be made to the Trustees for their review. In
addition, the Plan provides that it may not be amended to
increase materially the cost which holders of Class B shares of
the Fund may bear pursuant to the Plan without the approval of
the shareholders of such Class and that other material
amendments of the Plan must be approved by the Board of
Trustees and by the Trustees who are not "interested persons"
(as defined in the 1940 Act) of the Trust and have no direct or
indirect financial interest in the operation of the Plan or in
any agreements entered into in connection with the Plan, by
vote cast in person at a meeting called for the purpose of
considering such amendments. The Plan is subject to annual
approval by such vote of the Trustees cast in person at a
meeting called for the purpose of voting on the Plan. The Plan
was so approved by the Trustees at a meeting held on
__________, 1994. The Plan may be terminated at any time by
vote of a majority of the Trustees who are not "interested
persons" and have no direct or indirect financial interest in
the operation of the Plan or in any agreements entered into in
connection with the Plan or by vote of the holders of a
majority of Class B shares of the Fund.

Shareholder Services Plan. The Trust has
adopted a
Shareholder Services Plan, pursuant to which the Trust pays the
Distributor for the provision of certain services to the
holders of Class A and Class B shares of each Fund.

A quarterly report of the amounts expended under
the
Shareholder Services Plan, and the purposes for which such
expenditures were incurred, must be made to the Trustees for
their review. In addition, the Shareholder Services Plan
provides that it may not be amended without approval of the
Trustees, and by the Trustees who are neither "interested
persons" (as defined in the 1940 Act) of the Trust nor have any
direct or indirect financial interest in the operation of the
Shareholder Services Plan or in any agreements entered into in
connection with the Shareholder Services Plan, by vote cast in
person at a meeting called for the purpose of considering such
amendments. The Shareholder Services Plan is subject to annual
approval by such vote of the Trustees cast in person at a
meeting called for the purpose of voting on the Shareholder
Services Plan. The Shareholder Services Plan was so approved
on ___________, 1994. The Shareholder Services Plan is
terminable at any time by vote of a majority of the Trustees
who are not "interested persons" and who have no direct or
indirect financial interest in the operation of the Shareholder
Services Plan or in any agreements entered into in connection
with the Shareholder Services Plan.

REDEMPTION OF SHARES

The following information supplements and should
be
read in conjunction with the section in the Trust's Prospectus
entitled "How to Redeem Fund Shares."

Redemption Commitment. The Trust has committed
itself to pay in cash all redemption requests by any
shareholder of record of a Fund, limited in amount during any
90-day period to the lesser of $250,000 or 1% of the value of
such Fund's net assets at the beginning of such period. Such
commitment is irrevocable without the prior approval of the
Securities and Exchange Commission. In the case of requests
for redemption in excess of such amount, the Board of Trustees
reserves the right to make payments in whole or in part in
securities or other assets in case of an emergency or any time
a cash distribution would impair the liquidity of the Fund to
the detriment of the existing shareholders. In such event, the
securities would be valued in the same manner as the Fund's
securities are valued. If the recipient sold such securities,
brokerage charges would be incurred.

Suspension of Redemptions. The right of
redemption
may be suspended or the date of payment postponed (a) during
any period when the New York Stock Exchange is closed (other
than customary weekend and holiday closing), (b) when trading
in the markets the Fund ordinarily utilizes is restricted, or
when an emergency exists as determined by the Securities and
Exchange Commission so that disposal of the Fund's investments
or determination of its net asset value is not reasonably
practicable, or (c) for such other periods as the Securities
and Exchange Commission by order may permit to protect the
Fund's shareholders.

DETERMINATION OF NET ASSET
VALUE

The following information
supplements and
should be read in conjunction with the section in the Trust's
Prospectus entitled "How to Buy Shares."

Applicable to each Fund, other than
the Money
Market Funds--Equity Securities and covered call options
written by a Fund are valued at the last sale price on the
securities exchange or national securities market on which such
securities primarily are traded. Equity Securities not listed
on an exchange or national securities market, or securities in
which there were no transactions, are valued at the most recent
bid prices. Any securities or other assets for which recent
market quotations are not readily available are valued at fair
value as determined in good faith by the Trust's Board of
Trustees.

Fixed-Income Securities are valued
each
business day using available market quotations or at fair value
as determined by one or more independent pricing services
(collectively, the "Service") approved by the Trust's Board of
Trustees. The Service may use available market quotations,
employ electronic data processing techniques and/or a matrix
system to determine valuations. The Service's procedures are
reviewed by the Trust's officers under the general supervision
of the Trust's Board of Trustees.

Municipal Obligations are carried at
fair
value as determined by the Service, based on methods which
include consideration of: yields or prices of municipal bonds
of comparable quality, coupon, maturity and type; indications
as to values from dealers; and general market conditions. The
Service also may employ electronic data processing techniques
and/or a matrix system to determine valuations. When, in the
judgment of the Service, quoted bid prices for investments are
readily available and are representative of the bid side of the
market, these investments are valued at the mean between the
quoted bid prices (as obtained by the Service from dealers in
such securities) and asked prices (as calculated by the Service
based upon its evaluation of the market for such securities).

Short-term investments are carried
at
amortized cost, which approximates value.

Restricted securities, as well as
securities
or other assets for which market quotations are not readily
available, or are not valued by a pricing service approved by
the Trust's Board of Trustees, are valued at fair value as
determined in good faith by the Trust's Board of Trustees. The
Trust's Board of Trustees will review the method of valuation
on a current basis. In making its good faith valuation of
restricted securities, the Board of Trustees generally will
take the following factors into consideration: restricted
securities which are, or are convertible into, securities of
the same class of securities for which a public market exists
usually will be valued at market value less the same percentage
discount at which purchased. This discount will be revised
periodically by the Trust's Board of Trustees if its members
believe that the discount no longer reflects the value of the
restricted securities. Restricted securities not of the same
class as securities for which a public market exists usually
will be valued initially at cost. Any subsequent adjustment
from cost will be based upon considerations deemed relevant by
the Trust's Board of Trustees.

Any assets or liabilities initially
expressed
in terms of foreign currency will be translated into dollars at
the midpoint of the New York interbank market spot exchange
rate as quoted on the day of such translation by the Federal
Reserve Bank of New York or if no such rate is quoted on such
date, at the exchange rate previously quoted by the Federal
Reserve Bank of New York or at such other quoted market
exchange rate as may be determined to be appropriate by the
Investment Adviser. Forward currency contracts will be valued
at the current cost of offsetting the contract. Because of the
need to obtain prices as of the close of trading on various
exchanges throughout the world, the calculation of net asset
value for the International Equity and International Bond Funds
does not take place contemporaneously with the determination of
prices of such securities. In addition, portfolio securities
held by such Funds may be traded actively in securities markets
which are open for trading on days when the Fund will not be
determining its net asset value. Accordingly, there may be
occasions when these Funds will not calculate it net asset
value but when the value of the Fund's portfolio securities
will be affected by such trading activity.

Expenses and fees of a Fund,
including the
advisory fee, are accrued daily and taken into account for the
purpose of determining the net asset value of that Fund's
shares.

Money Market Funds. The valuation
of each
Money Market Fund's investment securities is based upon their
amortized cost which does not take into account unrealized
capital gains or losses. This involves valuing an instrument
at its cost 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. While this method provides certainty in valuation,
it may result in periods during which value, as determined by
amortized cost, is higher or lower than the price the Fund
would receive if it sold the instrument.

The Board of Trustees has
established
procedures, as a particular responsibility within the overall
duty of care owed to the Money Market Fund's investors,
reasonably designed to stabilize the Money Market Fund's price
per share as computed for purposes of purchases and redemptions
at $1.00. Such procedures include review of each Money Market
Fund's portfolio holdings by the Board of Trustees, at such
intervals as it deems appropriate, to determine whether the
Money Market Fund's net asset value calculated by using
available market quotations or market equivalents deviates from
$1.00 per share based on amortized cost. In such review of the
portfolio of the Money Market Fund and U.S. Government Money
Market Fund, investments for which market quotations are
readily available will be valued at the most recent bid price
or yield equivalent for such securities or for securities of
comparable maturity, quality and type, as obtained from one or
more of the major market makers for the securities to be
valued. Other investments and assets of these Money Market
Funds will be valued at fair value as determined in good faith
by the Board of Trustees. Market quotations and market
equivalents used in such review of the Municipal Money Market
Fund are obtained from an independent pricing service (the
"Service") approved by the Board of Trustees. The Service will
value the Municipal Money Market Fund's investments based on
methods which include consideration of: yields or prices of
municipal obligations of comparable quality, coupon, maturity
and type; indications of values from dealers; and general
market conditions. The Service also may employ electronic data
processing techniques and/or a matrix system to determine
valuations.

The extent of any deviation between
a Money
Market Fund's net asset value based upon available market
quotations or market equivalents and $1.00 per share based on
amortized cost will be examined by the Board of Trustees. If
such deviation exceeds 1/2 of 1%, the Board of Trustees will
consider what actions, if any, will be initiated. In the event
the Board of Trustees determines that a deviation exists which
may result in material dilution or other unfair results to
investors or existing shareholders, it has agreed to take such
corrective action as it regards as necessary and appropriate,
including: selling portfolio instruments prior to maturity to
realize capital gains or losses or to shorten average portfolio
maturity; withholding dividends or paying distributions from
capital or capital gains; redeeming shares in kind; or estab-
lishing a net asset value per share by using available market
quotations or market equivalents.

New York Stock Exchange Closings.
The
holidays (as observed) on which the New York Stock Exchange is
closed currently are: New Year's Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving
and Christmas.

PORTFOLIO TRANSACTIONS

Transactions are allocated to
various dealers
by the Trust's investment personnel in their best judgment.
The primary consideration is prompt and effective execution of
orders at the most favorable price. Subject to that primary
consideration, dealers may be selected to act on an agency
basis for research, statistical or other services to enable the
Investment Adviser to supplement its own research and analysis
with the views and information of other securities firms.

Research services furnished by
brokers through
which the Funds effect securities transactions may be used by
the Investment Adviser in advising other funds or accounts it
advises and, conversely, research services furnished to the
Investment Adviser by brokers in connection with other funds or
accounts the Investment Adviser advises may be used by the
Investment Adviser in advising the Funds. Although it is not
possible to place a dollar value on these services, it is the
opinion of the Investment Adviser that the receipt and study of
such services should not reduce the overall expenses of its
research department.

Brokers also are selected because of
their
ability to handle special executions such as are involved in
large block trades or broad distributions, provided the primary
consideration is met. Large block trades may, in certain
cases, result from two or more clients the Investment Adviser
might advise being engaged simultaneously in the purchase or
sale of the same security.

When transactions are executed in
the over-
the-counter market, the Investment Adviser will deal with the
primary market makers unless a more favorable price or
execution otherwise is obtainable.

Portfolio turnover may vary from
year to year,
as well as within a year. Higher turnover rates are likely to
result in comparatively greater brokerage expenses. The
overall reasonableness of brokerage commissions paid is
evaluated by the Investment Adviser based upon its knowledge of
available information as to the general level of commissions
paid by other institutional investors for comparable services.

Under normal market conditions, the
portfolio
turnover rate of each Fund, other than the Money Market Funds,
generally will not exceed the rate set forth below:

Portfolio
Name of Fund Turnover Rate

Managed Assets Balanced Fund ____%
Managed Assets Income Fund ____%
Equity Income Fund ____%
Growth Fund ____%
International Equity Fund ____%
Special Opportunities Fund ____%
International Bond Fund ____%
Bond Fund ____%
Intermediate Municipal Bond Fund ____%

Purchases and sales of Fixed-Income Securities
and
Money Market Instruments usually are principal transactions.
These portfolio securities ordinarily are purchased directly
from the issuer or from an underwriter or market maker.
Usually no brokerage commissions are paid by the Fund for such
purchases and sales. The prices paid to the underwriters of
newly-issued securities usually include a concession paid by
the issuer to the underwriter, and purchases of securities from
market makers may include the spread between the bid and asked
price.

DIVIDENDS, DISTRIBUTION AND
TAXES

THE FOLLOWING INFORMATION SUPPLEMENTS AND SHOULD
BE
READ IN CONJUNCTION WITH THE SECTION IN THE TRUST'S PROSPECTUS
ENTITLED "DIVIDENDS, DISTRIBUTIONS AND TAXES."

Each Fund intends to qualify as a "regulated
investment company" under the Code, so long as such
qualification is in the best interests of its shareholders. To
qualify as a regulated investment company, a Fund must pay out
to its shareholders at least 90% of its net income (consisting
of net investment income from tax exempt obligations and net
short-term capital gain), must derive less than 30% of its
annual gross income from gain on the sale of securities held
for less than three months, and must meet certain asset
diversification and other requirements. Accordingly, the Fund
may be restricted in the selling of securities held for less
than three months, and in the utilization of certain of the
investment techniques described in the Prospectus. The Code,
however, allows the Fund to net certain offsetting positions
making it easier for the Fund to satisfy the 30% test.
Qualification as a regulated investment company relieves the
Fund from any liability for Federal income taxes to the extent
its earnings are distributed in accordance with the applicable
provisions of the Code. The term "regulated investment
company" does not imply the supervision of management or
investment practices or policies by any government agency.

Any dividend or distribution paid shortly after
an
investor's purchase may have the effect of reducing the
aggregate net asset value of his shares below the cost of his
investment. Such a distribution would be a return on
investment in an economic sense although taxable as stated in
"Dividends, Distributions and Taxes" in the Prospectus. In
addition, the Code provides that if a shareholder holds shares
for six months or less and has received a capital gain dividend
with respect to such shares, any loss incurred on the sale of
such shares will be treated as a long-term capital loss to the
extent of the capital gain dividend received.

Except for dividends from taxable investments,
the
Fund anticipates that substantially all dividends paid by a
Municipal Fund will not be subject to Federal income tax.
Dividends and distributions paid by a Municipal Fund may be
subject to certain state and local taxes. Although all or a
substantial portion of the dividends paid by a Municipal Fund
may be excluded by shareholders of the Fund from their gross
income for Federal income tax purposes, each Municipal Fund may
purchase specified private activity bonds, the interest from
which may be (i) a preference item for purposes of the
alternative minimum tax, (ii) a component of the "adjusted
current earnings" preference item for purposes of the corporate
alternative minimum tax as well as a component in computing the
corporate environmental tax or (iii) a factor in determining
the extent to which a shareholder's Social Security benefits
are taxable. If a Municipal Fund purchases such securities,
the portion of its dividends related thereto will not
necessarily be tax exempt to shareholders subject to the
alternative minimum tax and/or tax on Social Security benefits
and may cause such shareholders to be subject to such taxes.

Dividends paid by a Fund to qualified Retirement
Plans or certain non-qualified deferred compensation plans
ordinarily will not be subject to taxation until the proceeds
are distributed from the Retirement Plan. The Trust will not
report dividends paid by a Fund to such Plans to the IRS.
Generally, distributions from such Retirement Plans, except
those representing returns of non-deductible contributions
thereto, will be taxable as ordinary income and, if made prior
to the time the participant reaches age 59-1/2, generally will
be subject to an additional tax equal to 10% of the taxable
portion of the distribution. If the distribution from such a
Retirement Plan (other than certain governmental or church
plans) for any taxable year following the year in which the
participant reaches age 70-1/2 is less than the "minimum
required distribution" for that taxable year, an excise tax
equal to 50% of the deficiency may be imposed by the IRS. The
administrator, trustee or custodian of such a Retirement Plan
will be responsible for reporting distributions from such Plans
to the IRS. Participants in qualified Retirement Plans will
receive a disclosure statement describing the consequences of a
distribution from such a Plan from the administrator, trustee
or custodian of the Plan prior to receiving the distribution.
Moreover, certain contributions to a qualified Retirement Plan
in excess of the amounts permitted by law may be subject to an
excise tax.

Taxable dividends derived from net investment
income
and distributions from net realized short-term securities gains
paid by a Fund to a foreign investor generally are subject to
U.S. nonresident withholding taxes at the rate of 30%, unless
the foreign investor claims the benefits of a lower rate
specified in a tax treaty. Distributions from net realized
long-term securities gains paid by a Fund to a foreign
investor, as well as the proceeds of any redemptions from a
foreign investor's account, regardless of the extent to which
gain or loss may be realized, will not be subject to U.S.
nonresident withholding tax. However, such distributions may
be subject to backup withholding, as described below, unless
the foreign investor certifies his non-U.S. residency status.

Ordinarily, gains and losses realized from
portfolio
transactions will be treated as capital gains and losses.
However, a portion of the gain or loss realized from the
disposition of non-U.S. dollar denominated securities
(including debt instruments, certain financial futures and
options, and certain preferred stock) may be treated as
ordinary income or loss under Section 988 of the Code.

Under Section 1256 of the Code, gain or loss
realized
by a Fund from certain financial futures and options
transactions (other than those taxed under Section 988 of the
Code) will be treated as 60% long-term capital gain or loss and
40% short-term capital gain or loss. Gain or loss will arise
upon the exercise or lapse of such futures and options as well
as from closing transactions. In addition, any such futures or
options remaining unexercised at the end of the Fund's taxable
year will be treated as sold for their then fair market value,
resulting in additional gain or loss to the Fund characterized
in the manner described above.

Offsetting positions held by a Fund involving
certain
contracts or options may constitute "straddles." "Straddles"
are defined to include "offsetting positions" in actively
traded personal property. The tax treatment of "straddles" is
governed by Sections 1092 and 1258 of the Code, which, in
certain circumstances, overrides or modifies the provisions of
Sections 1256 and 988. As such, all or a portion of any short-
term or long-term capital gain from certain "straddle"
transactions may be recharacterized to ordinary income. If the
Fund were treated as entering into "straddles" by reason of its
engaging in certain forward contracts or options transactions,
such "straddles" would be characterized as "mixed straddles" if
the forward contracts or options transactions comprising a part
of such "straddles" were governed by Section 1256 of the Code.
A Fund may make one or more elections with respect to "mixed
straddles." Depending on which election is made, if any, the
results to the Fund may differ. If no election is made to the
extent the "straddle" and conversion transactions rules apply
to positions established by the Fund, losses realized by the
Fund will be deferred to the extent of unrealized gain in the
offsetting position. Moreover, as a result of the "straddle"
rules, short-term capital loss on "straddle" positions may be
recharacterized as long-term capital loss, and long-term
capital gains may be treated as short-term capital gains or
ordinary income.

Investment by a Fund in securities issued or
acquired
at a discount, or providing for deferred interest or for
payment of interest in the form of additional obligations could
under special tax rules affect the amount, timing and character
of distributions to shareholders by causing the Fund to
recognize income prior to the receipt of cash payments. For
example, the Fund could be required to accrue a portion of the
discount (or deemed discount) at which the securities were
issued and to distribute such income in order to maintain its
qualification as a regulated investment company. In such case,
the Fund may have to dispose of securities which it might
otherwise have continued to hold in order to generate cash to
satisfy these distribution requirements.

If a Fund invests in an entity that is
classified as
a "passive foreign investment company" ("PFIC") for federal
income tax purposes, the operation of certain provisions of the
Code applying to PFICs could result in the imposition of
certain federal income taxes on the Fund. In addition, gain
realized from the sale or other disposition of PFIC securities
may be treated as ordinary income under Section 1291 of the
Code.

YIELD AND PERFORMANCE
INFORMATION

THE FOLLOWING INFORMATION SUPPLEMENTS AND SHOULD
BE
READ IN CONJUNCTION WITH THE SECTION IN THE TRUST'S PROSPECTUS
ENTITLED "PERFORMANCE INFORMATION."

SPECIAL OPPORTUNITIES, GROWTH AND INTERNATIONAL
EQUITY FUNDS. Average annual total return is calculated by
determining the ending redeemable value of an investment
purchased with a hypothetical $1,000 payment made at the
beginning of the period (assuming the reinvestment of dividends
and distributions), dividing by the amount of the initial
investment, taking the "n"the root of the quotient (where "n"
is the number of years in the period) and subtracting 1 from
the result.

Total return is calculated by subtracting the
amount
of the net asset value per share at the beginning of a stated
period from the net asset value per share at the end of the
period (after giving effect to the reinvestment of dividends
and distributions during the period), and dividing the result
by the net asset value per share at the beginning of the
period.

MANAGED ASSETS INCOME, MANAGED ASSETS BALANCED,
EQUITY INCOME, BOND AND MUNICIPAL BOND FUNDS. Current yield is
computed pursuant to a formula which operates as follows: The
amount of the Fund's expenses accrued for the 30-day period
(net of reimbursements) is subtracted from the amount of the
dividends and interest earned by the Fund during the period.
That result is then divided by the product of: (a) the average
daily number of shares outstanding during the period that were
entitled to receive dividends, and (b) the net asset value per
share on the last day of the period less any undistributed
earned income per share reasonably expected to be declared as a
dividend shortly thereafter. The quotient is then added to 1,
and that sum is raised to the 6th power, after which 1 is
subtracted. The current yield is then arrived at by
multiplying the result by 2.

Average annual total return and total return is
calculated as described above.

MONEY MARKET FUNDS. Yield will be computed in
accordance with a standardized method which involves
determining the net change in the value of a hypothetical pre-
existing Fund account having a balance of one share at the
beginning of a seven calendar day period for which yield is to
be quoted, dividing the net change by the value of the account
at the beginning of the period to obtain the base period
return, and annualizing the results (i.e., multiplying the base
period return by 365/7). The net change in the value of the
account reflects the value of additional shares purchased with
dividends declared on the original share and any such
additional shares and fees that may be charged to shareholder
accounts, in proportion to the length of the base period and
the Fund's average account size, but does not include realized
gains and losses or unrealized appreciation and depreciation.
Effective annualized yield is computed by adding 1 to the base
period return (calculated as described above), raising that sum
to a power equal to 365 divided by 7, and subtracting 1 from
the result.

Yields will fluctuate and are not necessarily
representative of future results. Investors should remember
that yield is a function of the type and quality of the
instruments held, their maturity and operating expenses. An
investor's principal in a Money Market Fund is not guaranteed.
See "Determination of Net Asset Value" for a discussion of the
manner in which the Money Market Fund's price per share is
determined.

INFORMATION ABOUT THE
TRUST

THE FOLLOWING INFORMATION SUPPLEMENTS AND SHOULD
BE
READ IN CONJUNCTION WITH THE SECTION IN THE TRUST'S PROSPECTUS
ENTITLED "GENERAL INFORMATION."

Each Fund share has one vote and, when issued
and
paid for in accordance with the terms of the offering, is fully
paid and non-assessable. Shares have no preemptive or
subscription rights and are freely transferable.

For clients of The First National Bank of
Chicago
("FNBC") whose assets are invested in common trust funds, the
Trust will be used in place of such investments. FNBC's
decision to replace the common trust funds is based on its
belief that mutual funds provide greater flexibility and more
investment opportunities for its clients.

Each Fund will send annual and semi-annual
financial
statements to all its shareholders.

COUNSEL AND INDEPENDENT
AUDITORS

Stroock & Stroock & Lavan, 7 Hanover Square, New
York, New York 10004-2594, as counsel for the Fund, has
rendered its opinion as to certain legal matters regarding the
due authorization and valid issuance of the shares of
beneficial interest being sold pursuant to the Fund's
Prospectus.

Ernst & Young LLP, 787 Seventh Avenue, New York,
New
York 10019, independent auditors, have been selected as
auditors of the Fund.

<PAGE>
APPENDIX

Description of certain ratings
assigned by
Standard & Poor's Corporation ("S&P"), Moody's Investors
Service, Inc. ("Moody's"), Fitch Investors Service, Inc.
("Fitch"), Duff & Phelps, Inc. ("Duff"), IBCA Inc. and IBCA
Limited ("IBCA") and Thomson BankWatch, Inc. ("BankWatch"):

S&P

BOND RATINGS

AAA

Bonds rated AAA have the highest
rating
assigned by S&P. Capacity to pay interest and repay principal
is extremely strong.

Bonds rated AA have a very strong
capacity to
pay interest and repay principal and differ from the highest
rated issues only in small degree.

Bonds rated A have a strong capacity
to pay
interest and repay principal although they are somewhat more
susceptible to the adverse effects of changes in circumstances
and economic conditions than obligations in higher rated
categories.

BBB

Bonds rated BBB are regarded as having
an
adequate capacity to pay interest and repay principal. Whereas
they normally exhibit adequate protection parameters, adverse
economic conditions or changing circumstances are more likely
to lead to a weakened capacity to pay interest and repay
principal for bonds in this category than for bonds in higher
rated categories.

BB, B, CCC, CC, C

Debt rated BB, B, CCC, CC and C is
regarded as
having predominantly speculative characteristics with respect
to capacity to pay interest and repay principal. BB indicates
the least degree of speculation and C the highest degree of
speculation. While such debt will likely have some quality and
protective characteristics, these are outweighed by large
uncertainties or major risk exposures to adverse conditions.

Debt rated BB has less near-term
vulnerability
to default than other speculative grade debt. However, it
faces major ongoing uncertainties or exposure to adverse
business, financial or economic conditions which could lead to
inadequate capacity to meet timely interest and principal
payment.

Debt rated B has a greater
vulnerability to
default but presently has the capacity to meet interest
payments and principal repayments. Adverse business, financial
or economic conditions would likely impair capacity or
willingness to pay interest and repay principal.

CCC

Debt rated CCC has a current
identifiable
vulnerability to default, and is dependent upon favorable
business, financial and economic conditions to meet timely
payments of principal. In the event of adverse business,
financial or economic conditions, it is not likely to have the
capacity to pay interest and repay principal.

The rating CC is typically applied to
debt
subordinated to senior debt which is assigned an actual or
implied CCC rating.

The rating C is typically applied to
debt
subordinated to senior debt which is assigned an actual or
implied CCC- debt rating.

Bonds rated D are in default, and
payment of
interest and/or repayment of principal is in arrears.

Plus (+) or minus (-): The ratings
from AA to
CCC may be modified by the addition of a plus or minus sign to
show relative standing within the major ratings categories.

COMMERCIAL PAPER RATING

The designation A-1 by S&P indicates
that the
degree of safety regarding timely payment is either
overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics are denoted with a
plus sign (+) designation. Capacity for timely payment on
issues with an A-2 designation is strong. However, the
relative degree of safety is not as high as for issues
designated A-1.

Moody's

BOND RATINGS

Aaa

Bonds which are rated Aaa are judged
to be of
the best quality. They carry the smallest degree of investment
risk and are generally referred to as "gilt edge." Interest
payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective
elements are likely to change, such changes as can be
visualized are most unlikely to impair the fundamentally strong
position of such issues.

Bonds which are rated Aa are judged to
be of
high quality by all standards. Together with the Aaa group
they comprise what generally are known as high grade bonds.
They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude
or there may be other elements present which make the long-term
risks appear somewhat larger than in Aaa securities.

Bonds which are rated A possess many
favorable
investment attributes and are to be considered as upper medium
grade obligations. Factors giving security to principal and
interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the
future.

Baa

Bonds which are rated Baa are
considered as
medium grade obligations, i.e., they are neither highly
protected nor poorly secured. Interest payments and principal
security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding
investment characteristics and in fact have speculative
characteristics as well.

Bonds which are rated Ba are judged to
have
speculative elements; their future cannot be considered as well
assured. Often the protection of interest and principal
payments may be very moderate, and therefore not well
safeguarded during both good and bad times over the future.
Uncertainty of position characterizes bonds in this class.

Bonds which are rated B generally lack
characteristics of the desirable investment. Assurance of
interest and principal payments or of maintenance of other
terms of the contract over any long period of time may be
small.

Caa

Bonds which are rated Caa are of poor
standing.
Such issues may be in default or there may be present elements
of danger with respect to principal or interest.

Caa

Bonds which are rated 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.

Bonds which are rated Ca present
obligations
which are speculative in a high degree. Such issues are often
in default or have other marked shortcomings.

Bonds which are rated C are the lowest
rated
class of bonds, and issues so rated can be regarded as having
extremely poor prospects of ever attaining any real investment
standing.

Moody's applies the numerical
modifiers 1, 2
and 3 to show relative standing within the major rating
categories, except in the Aaa category and in categories below
B. The modifier 1 indicates a ranking for the security in the
higher end of a rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates a ranking in
the lower end of a rating category.

COMMERCIAL PAPER RATING

The rating Prime-1 (P-1) is the
highest
commercial paper rating assigned by Moody's. Issuers of P-1
paper must have a superior capacity for repayment of short-term
promissory obligations, and ordinarily will be evidenced by
leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization
structures with moderate reliance on debt and ample asset
protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well
established access to a range of financial markets and assured
sources of alternate liquidity.

Issuers (or relating supporting
institutions)
rated Prime-2 (P-2) have a strong capacity for repayment of
short-term promissory obligations. This ordinarily will be
evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while
sound, will be more subject to variation. Capitalization
characteristics, while still appropriate, may be more affected
by external conditions. Ample alternate liquidity is
maintained.

Fitch

BOND RATINGS

The ratings represent Fitch's
assessment of the
issuer's ability to meet the obligations of a specific debt
issue or class of debt. The ratings take into consideration
special features of the issue, its relationship to other
obligations of the issuer, the current financial condition and
operative performance of the issuer and of any guarantor, as
well as the political and economic environment that might
affect the issuer's future financial strength and credit
quality.

AAA

Bonds rated AAA are considered to be
investment
grade and of the highest credit quality. The obligor has an
exceptionally strong ability to pay interest and repay
principal, which is unlikely to be affected by reasonably
foreseeable events.

Bonds rated AA are considered to be
investment
grade and of very high credit quality. The obligor's ability
to pay interest and repay principal is very strong, although
not quite as strong as bonds rated AAA. Because bonds rated in
the AAA and AA categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these
issuers is generally rated F-1+.

Bonds rated A are considered to be
investment
grade and of high credit quality. The obligor's ability to pay
interest and repay principal is considered to be strong, but
may be more vulnerable to adverse changes in economic
conditions and circumstances than bonds with higher ratings.

BBB

Bonds rated BBB are considered to be
investment
grade and of satisfactory credit quality. The obligor's
ability to pay interest and repay principal is considered to be
adequate. Adverse changes in economic conditions and
circumstances, however, are more likely to have an adverse
impact on these bonds and, therefore, impair timely payment.
The likelihood that the ratings of these bonds will fall below
investment grade is higher than for bonds with higher ratings.

Bonds rated BB are considered
speculative. The
obligor's ability to pay interest and repay principal may be
affected over time by adverse economic changes. However,
business and financial alternatives can be identified which
could assist the obligor in satisfying its debt service
requirements.

Bonds rated B are considered highly
speculative. While bonds in this class are currently meeting
debt service requirements, the probability of continued timely
payment of principal and interest reflects the obligor's
limited margin of safety and the need for reasonable business
and economic activity throughout the life of the issue.

CCC

Bonds rated CCC have certain
identifiable
characteristics, which, if not remedied, may lead to default.
The ability to meet obligations requires an advantageous
business and economic environment.

Bonds rated CC are minimally
protected.
Default payment of interest and/or principal seems probable
over time.

Bonds rated C are in imminent default
in
payment of interest or principal.

DDD, DD and D

Bonds rated DDD, DD and D are in
actual or
imminent default of interest and/or principal payments. Such
bonds are extremely speculative and should be valued on the
basis of their ultimate recovery value in liquidation or
reorganization of the obligor. DDD represents the highest
potential for recovery on these bonds and D represents the
lowest potential for recovery.

Plus (+) and minus (-) signs are used
with a
rating symbol to indicate the relative position of a credit
within the rating category. Plus and minus signs, however, are
not used in the AAA category covering 12-36 months or the DDD,
DD or D categories.

SHORT-TERM RATINGS

Fitch's short-term ratings apply to
debt
obligations that are payable on demand or have original
maturities of up to three years, including commercial paper,
certificates of deposit, medium-term notes, and municipal and
investment notes.

Although the credit analysis is
similar to
Fitch's bond rating analysis, the short-term rating places
greater emphasis than bond ratings on the existence of
liquidity necessary to meet the issuer's obligations in a
timely manner.

F-1+

EXCEPTIONALLY STRONG CREDIT QUALITY.
Issues
assigned this rating are regarded as having the strongest
degree of assurance for timely payment.

F-1

VERY STRONG CREDIT QUALITY. Issues
assigned
this rating reflect an assurance of timely payment only
slightly less in degree than issues rated F-1+.

F-2

GOOD CREDIT QUALITY. Issues carrying
this
rating have a satisfactory degree of assurance for timely
payments, but the margin of safety is not as great as the F-1+
and F-1 categories.

Duff

BOND RATINGS

AAA

Bonds rated AAA are considered highest
credit
quality. The risk factors are negligible, being only slightly
more than for risk-free U.S. Treasury debt.

Bonds rated AA are considered high
credit
quality. Protection factors are strong. Risk is modest but
may vary slightly from time to time because of economic
conditions.

Bonds rated A have protection factors
which are
average but adequate. However, risk factors are more variable
and greater in periods of economic stress.

BBB

Bonds rated BBB are considered to have
below
average protection factors but still considered sufficient for
prudent investment. Considerable variability in risk during
economic cycles.

Bonds rated BB are below investment
grade but
are deemed by Duff as likely to meet obligations when due.
Present or prospective financial protection factors fluctuate
according to industry conditions or company fortunes. Overall
quality may move up or down frequently within the category.

Bonds rated B are below investment
grade and
possess the risk that obligations will not be met when due.
Financial protection factors will fluctuate widely according to
economic cycles, industry conditions and/or company fortunes.
Potential exists for frequent changes in quality rating within
this category or into a higher or lower quality rating grade.

CCC

Bonds rated CCC are well below
investment grade
securities. Such bonds may be in default or have considerable
uncertainty as to timely payment of interest, preferred
dividends and/or principal. Protection factors are narrow and
risk can be substantial with unfavorable economic or industry
conditions and/or with unfavorable company developments.

Defaulted debt obligations. Issuer
has failed
to meet scheduled principal and/or interest payments.

Plus (+) and minus (-) signs are used
with a
rating symbol (except AAA) to indicate the relative position of
a credit within the rating category.

COMMERCIAL PAPER RATING

The rating Duff-1 is the highest
commercial
paper rating assigned by Duff. Paper rated Duff-1 is regarded
as having very high certainty of timely payment with excellent
liquidity factors which are supported by ample asset
protection. Risk factors are minor. Paper rated Duff-2 is
regarded as having good certainty of timely payment, good
access to capital markets and sound liquidity factors and
company fundamentals. Risk factors are small.

IBCA

BOND AND LONG-TERM RATINGS

Obligations rated AAA by IBCA have the
lowest
expectation of investment risk. Capacity for timely repayment
of principal and interest is substantial, such that adverse
changes in business, economic or financial conditions are
unlikely to increase investment risk significantly.
Obligations for which there is a very low expectation of
investment risk are rated AA by IBCA. Capacity for timely
repayment of principal and interest is substantial. Adverse
changes in business, economic or financial conditions may
increase investment risk albeit not very significantly.

COMMERCIAL PAPER AND SHORT-TERM RATINGS

The designation A1 by IBCA indicates
that the
obligation is supported by a very strong capacity for timely
repayment. Those obligations rated A1+ are supported by the
highest capacity for timely repayment. Obligations rated A2
are supported by a strong capacity for timely repayment,
although such capacity may be susceptible to adverse changes in
business, economic or financial conditions.

INTERNATIONAL AND U.S. BANK RATINGS

An IBCA bank rating represents IBCA's
current
assessment of the strength of the bank and whether such bank
would receive support should it experience difficulties. In
its assessment of a bank, IBCA uses a dual rating system
comprised of Legal Ratings and Individual Ratings. In
addition, IBCA assigns banks Long- and Short-Term Ratings as
used in the corporate ratings discussed above. Legal Ratings,
which range in gradation from 1 through 5, address the question
of whether the bank would receive support provided by central
banks or shareholders if it experienced difficulties, and such
ratings are considered by IBCA to be a prime factor in its
assessment of credit risk. Individual Ratings, which range in
gradations from A through E, represent IBCA's assessment of a
bank's economic merits and address the question of how the bank
would be viewed if it were entirely independent and could not
rely on support from state authorities or its owners.

BankWatch

COMMERCIAL PAPER AND SHORT-TERM RATINGS

The rating TBW-1 is the highest
short-term
rating assigned by BankWatch; the rating indicates that the
degree of safety regarding timely repayment of principal and
interest is very strong.

In addition to ratings of short-term
obligations, BankWatch assigns a rating to each issuer it
rates, in gradations of A through E. BankWatch examines all
segments of the organization including, where applicable, the
holding company, member banks or associations, and other
subsidiaries. In those instances where financial disclosure is
incomplete or untimely, a qualified rating (QR) is assigned to
the institution. BankWatch also assigns, in the case of
foreign banks, a country rating which represents an assessment
of the overall political and economic stability of the country
in which the bank is domiciled.

<PAGE>

FINANCIAL STATEMENTS

[TO BE PROVIDED]

REPORT OF INDEPENDENT ACCOUNTANTS

[TO BE PROVIDED]

<PAGE>
PART C. OTHER
INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements:

(1) Statement of Assets and Liabilities
as of ___, 1994*

(2) Report of Ernst & Young LLP, Indepen-
dent Auditors, dated
_________, 1994*

(b) Exhibits:

(1) Amended and Restated
Agreement and Declaration of Trust*

(2) By-Laws*

(5) (a) Investment Advisory
Agreement*

(b) Sub-Investment Advisory
Agreement*

(6) Distribution Agreement*

(8) Custody Agreement*

(9) (a) Administration Agreement*

(9) (b) Master
Sub-Administration
Agreement*

(9) (c) Shareholder
Services Plan*

(10) Opinion (including consent)
of Stroock & Stroock & Lavan*

(11) Consent of Independent Auditors*

(15) Distribution Plan*

Other Exhibit:
Secretary's Certificate*

- --------------------------------
* To be filed by amendment.

<PAGE>

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON
CONTROL WITH REGISTRANT

Not applicable.

ITEM 26. NUMBER OF HOLDERS OF SECURITIES

(1) (2)

NUMBER OF RECORD
TITLE OF CLASS HOLDERS

Shares of beneficial interest,
par value $.001 per share
Managed Assets Balanced Fund ____

Managed Assets Income Fund ____
Equity Income Fund ____
Growth Fund ____
International Equity Fund ____
Special Opportunities Fund ____
International Bond Fund ____
Bond Fund ____
Intermediate Municipal Bond Fund ____
U.S. Government Money Market Fund ____
Money Market Fund ____
Municipal Money Market Fund ____

ITEM 27. INDEMNIFICATION

Reference is made to Article EIGHTH of the
Registrant's Declaration of Trust to be filed as Exhibit 1
hereto. The application of these provisions is limited by
Article 10 of the Registrant's By-Laws to be filed as Exhibit 2
hereto and by the following undertaking set forth in the rules
promulgated by the Securities and Exchange Commission:

Insofar as indemnification for liabilities
arising under the Securities Act of 1933
may be permitted to trustees, officers and
controlling persons of the registrant pur-
suant to the foregoing provisions, or
otherwise, the registrant has been advised
that in the opinion of the Securities and
Exchange Commission such indemnification is
against public policy as expressed in such
Act and is, therefore, unenforceable. In
the event that a claim for indemnification
against such liabilities (other than the
payment by the registrant of expenses
incurred or paid by a trustee, officer or
controlling person of the registrant in the
successful defense of any action, suit or
proceeding) is asserted by such trustee,
officer or controlling person in connection
with the securities being registered, the
registrant will, unless in the opinion of
its counsel the matter has been settled by
controlling precedent, submit to a court of
appropriate jurisdiction the question
whether such indemnification by it is
against public policy as expressed in such
Act and will be governed by the final
adjudication of such issue.

Reference also is made to the Distribution
Agreement
to be filed as Exhibit 6 hereto.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT
ADVISER

(a) Investment Adviser

Registrant is fulfilling the requirement of
this
Item 28 to provide a list of the officers and directors of
First Chicago Investment Management Company (the "Investment
Adviser"), together with information as to any other business,
profession, vocation or employment of a substantial nature
engaged in by the Investment Adviser or those of its officers
and directors during the past two years, by incorporating by
reference the information contained in the Form ADV filed with
the SEC pursuant to the Investment Advisers Act of 1940 by the
Investment Adviser (SEC File No. 801-_____).

(b) Sub-Investment Adviser

Registrant is fulfilling the requirement of
this
Item 28 to provide a list of the officers and directors of ANB
Investment Management and Trust Company (the "Sub-Adviser"),
together with information as to any other business, profession,
vocation or employment of a substantial nature engaged in by
the Sub-Adviser or those of its officers and directors during
the past two years, by incorporating by reference the
information contained in the Form ADV filed with the SEC
pursuant to the Investment Advisers Act of 1940 by the Sub-
Adviser (SEC File No. 801-_____).

ITEM 29. PRINCIPAL UNDERWRITERS

(a) Other investment companies for which
Registrant's principal underwriter (exclusive distributor) acts
as principal underwriter or exclusive distributor:

The Infinity Mutual Funds, Inc.
Emerald Fund, Inc.
Pacific Horizon Funds, Inc.

(b) The information required by this Item 29(b)
regarding each director or officer of Concord Financial Group,
Inc. is incorporated by reference to Schedule A of Form BD
filed by Concord Financial Group, Inc. pursuant to the
Securities Exchange Act of 1934 (SEC File No. 8-37601).

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS

1. First Chicago Investment Management
Company
Three First National Plaza
Chicago, Illinois 60670

2. Concord Financial Group, Inc.
125 West 55th Street
11th Floor
New York, New York 10019

ITEM 31. MANAGEMENT SERVICES

Not Applicable

ITEM 32. UNDERTAKINGS

Registrant hereby undertakes

(1) to file a post-effective
amendment, using
financial statements which
need not be
certified, within four to
six months from
the effective date of
Registrant's 1933
Act Registration Statement.

(2) to call a meeting of
shareholders for the
purpose of voting upon the
question of
removal of a trustee or
trustees when
requested in writing to do
so by the
holders of at least 10% of
the
Registrant's outstanding
shares of
beneficial interest and in
connection
with such meeting to comply
with the
provisions of Section 16(c)
of the
Investment Company Act of
1940 relating
to shareholder
communications.

<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 Amendment to the Registration Statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, and State of New York on
the
27th day of October, 1994.

PRAIRIE FUNDS

BY: /s/Joseph F. Kissel

- ------------------------------
Joseph F. Kissel,
President

Pursuant to the requirements of the Securities Act of 1933
and the Investment Company Act of 1940, this Amendment to the
Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.

<TABLE>

SIGNATURES TITLE DATE
<S> <C> <C>

/s/Joseph K. Kissel President (Principal October 27, 1994
- --------------------------
Joseph Kissel Executive Officer)

/s/ Richard A. Fabietti Treasurer (Principal October 27, 1994
- --------------------------
Richard A. Fabietti Financial and
Accounting Officer)

/s/David Stephens Trustee October 27, 1994
- --------------------------
David Stephens
</TABLE>