MTB Group of Funds

485BPOS 1 form.htm MTB Group of Funds - 485BPOS



                                              1933 Act File No. 33-20673
                                              1940 Act File No. 811-5514

                       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. 72 ..............................        X

                                     and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940           X

    Amendment No. 73 .............................................        X

                               MTB GROUP OF FUNDS
                            (Variable Annuity Funds)

               (Exact Name of Registrant as Specified in Charter)

           5800 Corporate Drive, Pittsburgh, Pennsylvania 15237-7010
                    (Address of Principal Executive Offices)

                                 (412) 288-1900
                        (Registrant's Telephone Number)

                           C. Grant Anderson, Esquire
                                 Reed Smith LLP
                           Federated Investors Tower,
                              1001 Liberty Avenue
                      Pittsburgh, Pennsylvania 15222-3779
                    (Name and Address of Agent for Service)
               (Notices should be sent to the Agent for Service)

It is proposed that this filing will become effective:

_X  immediately upon filing pursuant to paragraph (b)
___ on _____________ pursuant to paragraph (b)(1)(iii)
 _  60 days after filing pursuant to paragraph (a) (i)
    on _______________ pursuant to paragraph (a) (i)
_   75 days after filing pursuant to paragraph (a)(ii)
    on _______________ pursuant to paragraph (a)(ii) of Rule 485.

If appropriate, check the following box:

  _ This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.


                                    Copy to:

Matthew G. Maloney, Esquire
Dickstein Shapiro LLP
1825 Eye Street, N.W.
Washington, D.C.  20006

[Logo of MTB Group of Funds]

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April 30, 2007 : PROSPECTUS

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Introduction – Information Common to All Portfolios

Each portfolio (each, a “Fund”) of MTB Group of Funds (the “Trust”) is a mutual fund. A mutual fund pools shareholders’ money and, using professional investment managers, invests it in securities.

Each Fund has its own investment goal and strategies for reaching that goal. The investment advisor invests each Fund’s assets in a way that he or she believes will help a Fund achieve its goal. Still, investing in each Fund involves risk, and there is no guarantee that a Fund will achieve its goal. The investment advisor’s judgments about the markets, the economy, or companies may not anticipate actual market movements, economic conditions or company performance, and these judgments may affect the return on your investment. In fact, no matter how good a job the investment advisor does, you could lose money on your investment in a Fund, just as you could with other investments.

The value of your investment in a Fund is based on the market prices of the securities the Fund holds. These prices change daily due to economic and other events that affect particular companies and other issuers. These price movements, sometimes called volatility, may be greater or lesser depending on the types of securities a Fund owns and the markets in which they trade. The effect on a Fund of a change in the value of a single security will depend on how widely the Fund diversifies its holdings.

This prospectus has been arranged into different sections so that you can easily review this important information. For more detailed information about each Fund, please see:

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Contents
Fund Goals, Strategies,
Risks and Performance				1
MTB Large Cap Growth Fund II				3
MTB Large Cap Value Fund II				5
MTB Managed Allocation Fund –
Conservative Growth II				7
MTB Managed Allocation Fund –
Moderate Growth II				10
MTB Managed Allocation Fund –
Aggressive Growth II				13
Principal Securities of the Funds				18
Other Investment Strategies				23
Specific Risks of Investing in the Funds				23
How are Shares Priced?				26
How are the Funds Sold?				27
How to Purchase, Redeem and
Exchange Shares				28
Account and Share Information				29
Who Manages the Funds?				30
Financial Information				33
How to Obtain More Information
About MTB Funds				35

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Managed by MTB Investment Advisors, Inc. The Securities and Exchange Commission has not approved or disapproved these securities or passed upon the adequacy of this prospectus. Any representation to the contrary is a criminal offense.

MTB Funds • Are NOT FDIC Insured • Have No Bank Guarantee • May Lose Value

FUND GOALS, STRATEGIES, RISKS AND PERFORMANCE

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This prospectus of the MTB Group of Funds (Trust) offers shares of MTB Large Cap Growth Fund II (Large Cap Growth Fund II), MTB Large Cap Value Fund II (Large Cap Value Fund II), MTB Managed Allocation Fund – Conservative Growth II (Conservative Growth Fund II), MTB Managed Allocation Fund – Moderate Growth II (Moderate Growth Fund II) and MTB Managed Allocation Fund – Aggressive Growth II (Aggressive Growth Fund II), (Fund, or Funds), each of which is a portfolio of the Trust. The Funds are managed by MTB Investment Advisors, Inc. (Advisor). Large Cap Value Fund II is sub-advised by NWQ Investment Management Company LLC.

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Currently, shares of the Funds may be sold only to separate accounts of insurance companies to serve as the investment medium for variable annuity contracts and variable life insurance policies issued by the insurance companies.

The separate accounts invest in the Funds in accordance with allocation instructions received from owners of annuity contracts. Such allocation rights are described further in the prospectus for the separate account. The Funds are subject to investment limitations that do not apply to other mutual funds available directly to the general public. Therefore, any comparison of these two types of mutual funds may not be appropriate.

This prospectus contains the information you should read and know before you invest in the Funds. Keep this prospectus for future reference.

This prospectus should be accompanied by the prospectus for such a variable annuity contract or variable life insurance policy.

The Fees and Expenses tables and the Examples that follow them relate exclusively to the Funds’ Shares. They do not reflect any additional fees or expenses that may be imposed by separate accounts of insurance companies or in connection with any variable annuity or variable life insurance contract. If these had been included, your costs would be higher. The share performance reflected in the Performance Information (Performance Bar Chart and Table), and the Financial Highlights does not reflect any charges or expenses that would be imposed under a variable insurance product contract. Were the effect of such charges to be included, Share performance would be lower.

The Shares of the Funds offered by this prospectus are not deposits or obligations of any bank, are not endorsed or guaranteed by any bank and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other government agency.

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MTB LARGE CAP GROWTH FUND II

CUSIP: 55376T734

Goal

To provide capital appreciation.

Strategy

The Fund invests, under normal market conditions, at least 80% of the value of its net assets in a diversified portfolio of equity securities (primarily common stocks) of large cap companies. Equity securities include common and preferred stocks as well as convertible securities. The Advisor uses a bottom-up approach to selecting growth-oriented stocks. The Fund seeks to invest in high-quality, well established large-cap companies that:

have a strong history of earnings growth;
are attractively priced, relative to the company’s potential for above-average, long-term earnings and revenue growth;
have strong balance sheets;
have a sustainable competitive advantage; and
are currently, or have the potential to become industry leaders.

For the purposes of the 80% limitation, large cap companies will be defined as companies with market capitalizations similar to companies in the S&P 500 Index. The definition will be applied at the time of initial investment, and the Fund will not be required to sell (or be precluded from adding to) a pre-existing investment because a company’s market capitalization has grown or reduced outside the market capitalization range of the index. As of December 31, 2006, the market capitalization of companies in the S&P 500 Index ranged from $1.4 billion to $447.0 billion. The capitalization range is subject to frequent change, and thus the applicable range of market capitalizations defining large cap companies at time of purchase will likely differ from the range at December 31, 2006. The Fund may engage in short sales transactions on securities in order to take advantage of an anticipated decline in the security’s price or to hedge against its potential price volatility.

Risks

Following are principal risks associated with investment in the Fund:

Stock Market Risk – The value of equity securities in the Fund’s portfolio will fluctuate and, as a result, the Fund’s Share price may decline suddenly or over a sustained period of time.
Risks Related to Investing for Growth – The growth stocks in which the Fund invests are typically more volatile than value stocks and may depend more on price changes than dividends for return.
Close Out Risks – In a short sale transaction, the party lending the security to the Fund may require the Fund to close out its short position at a price which would result in a loss to the Fund
Leverage Risks – Leverage risk is created when an investment exposes the Fund to a level of risk that exceeds the amount invested. Changes in the value of such an investment magnify the Fund’s risk of loss and potential for gain.

Performance Information
Risk/Return Bar Chart and Average Annual Total Return Table

The performance information shown below will help you analyze the Fund’s investment risks in light of its historical returns. The bar chart shows the variability of the Fund’s total returns on a calendar year-by-year basis. The Average Annual Total Return table shows returns averaged over the stated periods, and includes comparative performance information. The Fund’s performance will fluctuate, and past performance is no guarantee of future results.

Risk/Return Bar Chart

Best Quarter
   9.18%
   6/30/2003

Worst Quarter
   (6.71)%
   9/30/2004

The Fund’s Shares are sold without a sales charge (load). The total returns shown in the bar chart above are based upon net asset value and do not reflect the charges and expenses of a variable annuity or variable annuity life insurance contract. If these charges or fees had been included, the returns would have been lower.

The Fund’s total return for the three-month period from January 1, 2007 to March 31, 2007 was 1.28%.

Average Annual Total Return Table

Return Before Taxes is shown. The table also shows returns for the Standard & Poor’s 500/Citigroup Growth Index (S&P 500/CG), a broad based market index; and the Lipper Large Cap Growth Funds Average (LLCGFA), an average of Funds with similar investment objectives. The S&P 500/CG is an unmanaged index comprised of approximately half of the S&P 500 index that have been identified as being on the growth end of the growth-value spectrum. Lipper figures represent the average of the total returns reported by all of the mutual funds designated by Lipper, Inc. as falling into the respective categories indicated. Index returns shown do not reflect taxes, sales charges, expenses or other fees that the SEC requires to be reflected in the Fund’s performance. Indexes are unmanaged, and unlike the Fund, are not affected by cash flows. It is not possible to invest directly in an index or an average.

(For the period ended December 31, 2006)

		Start of
	1 Year	Performance(1)

Return Before Taxes	10.34%	3.28%

S&P 500/CG	9.39%	4.43%

LLCGFA	5.61%	4.82%

(1) The Fund’s start of performance date was May 31, 2002.

Fees and Expenses

Note: The table below and the Example that follows it relate exclusively to the Fund’s Shares. They do not reflect any additional fees or expenses that may be imposed by separate accounts of insurance companies or in connection with any variable annuity or variable life insurance contract. If these had been included, your costs would be higher.

This table describes the fees and expenses that you may pay if you buy and hold Shares of the Fund.

Shareholder Fees

		The Fund

Fees Paid Directly From Your Investment		N/A

Annual Fund Operating Expenses

Expenses That are Deducted From Fund Assets
(as a percentage of average net assets)

		The Fund

Management Fee(1)(2)		0.85%

Distribution (12b-1) Fee		0.25%

Other Expenses(3)		1.39%

Total Direct Annual Fund Operating Expenses
(before contractual waiver and reimbursement)		2.49%

Acquired Fund Fees and Expenses(4)		0.01%

Total Direct and Acquired Annual Fund
Operating Expenses (before contractual waiver and reimbursement)		2.50%

Total Waiver and Reimbursement of
Fund Expenses (contractual)(1)		1.49%

Total Direct and Acquired Annual Fund Operating
Expenses (after contractual waiver and reimbursement)		1.01%

(1)		The Advisor agreed to contractually waive all or a portion of its investment advisory fee (based on average daily net assets) to which it is otherwise entitled to receive and/or reimburse certain operating expenses of the Fund in order to limit the Fund’s total Direct Annual Fund operating expenses to not more than 1.00% of the Fund’s average daily net assets through April 30, 2008.

(2)		To comply with the investment advisory agreement, the Advisor waived its management fee. The management fee paid by the Fund (after contractual waiver) was 0.00% for the fiscal year ended December 31, 2006.

(3)		Includes a shareholder services fee/account administration fee which is used to compensate intermediaries for shareholder services or account administrative services. Also includes a recordkeeping fee which is used to compensate intermediaries for record keeping services. Total other expenses paid by the Fund (after contractual reimbursement) were 0.75% for the fiscal year ended December 31, 2006.

(4)		The Fund’s shareholders indirectly bear the expenses of the acquired funds in which the Fund invests. The Fund’s indirect expenses from investing in the acquired funds is based upon the average allocation of the Fund’s investments in the acquired funds and upon the actual operating expenses of the acquired funds (including any current waivers and expense limitations) from their most recent shareholder report dated October 31, 2006. Actual acquired fund expenses incurred by the Fund may vary with changes in the allocation of the Fund’s assets among the acquired funds and with other events that directly affect the expenses of the acquired funds.

Example

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.

The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your Shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund’s operating expenses are based upon the Total Direct and Acquired Annual Fund Operating Expenses (after contractual waiver and reimbursement), as shown in the table and remain the same. Although your actual costs and returns may be higher or lower, based on these assumptions your costs would be:

1 Year	3 Years	5 Years	10 Years

$103	$322	$558	$1,236

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MTB LARGE CAP VALUE FUND II

CUSIP: 55376T650

Goal

To provide capital appreciation. Current income is a secondary, non-fundamental consideration.

Strategy

The Fund invests, under normal market conditions, at least 80% of the value of its net assets in a diversified portfolio of equity securities (primarily common stocks) of large cap U.S. companies. The Fund may also invest a limited percentage of its assets in foreign securities. Equity securities include common and preferred stocks, as well as convertible securities. The investment advisor uses a value-oriented approach to select those companies with unrecognized or undervalued assets. Such a value approach seeks companies whose stock prices do not appear to reflect their underlying value as measured by assets, earnings, cash flow, business franchises, or other quantitative or qualitative measurements.

For the purposes of the 80% limitation, large cap companies will be defined as companies with market capitalizations similar to companies in the S&P 500 Index. The definition will be applied at the time of initial investment, and the Fund will not be required to sell (or be precluded from adding to) a pre-existing investment because a company’s market capitalization has grown or reduced outside the market capitalization range of the index. As of December 31, 2006, the market capitalization of companies in the S&P 500 Index ranged from $1.4 billion to $447.0 billion. The capitalization range is subject to frequent change, and thus the applicable range of market capitalization defining large cap companies at time of purchase will likely differ from the range at December 31, 2006.

Risks

All mutual funds take risks. Therefore, it is possible to lose money by investing in the Fund. The primary factors that may reduce the Fund’s returns include:

Stock Market Risk – The value of equity securities in the Fund’s portfolio will fluctuate and, as a result, the Fund’s Share price may decline suddenly or over a sustained period of time.
Risks Related to Investing for Value – Due to their relatively low valuations, value stocks are typically less volatile than growth stocks. However, value stocks may lag behind growth stocks in an up market.
Risks of Foreign Investing – Foreign, economic, political or regulatory conditions may be less favorable than those of the United States.

Performance Information
Risk/Return Bar Chart and Average Annual Total Return Table

Risk/Return Bar Chart

Best Quarter
   19.08%
   6/30/2003

Worst Quarter
   (3.24)%
   3/31/2003

The Fund’s Shares are sold without a sales charge (load). The total returns shown in the bar chart above are based upon net asset value and do not reflect the charges and expenses of a variable annuity or variable life insurance contract. If these charges or fees had been included, the returns would have been lower.

The Fund’s total return for the three-month period from January 1, 2007 to March 31, 2007 was 1.67%.

Average Annual Total Return Table

Return Before Taxes is shown. The table also shows returns for Standard & Poor’s 500/Citigroup Value Index (S&P 500/CV), a broad-based market index; and the Lipper Large Cap Value Funds Average (LLCVFA), an average of Funds with similar investment objectives. The S&P 500/CV is an unmanaged index comprised of approximately half the market capitalization of the S&P 500 Index that have been identified as being on the value end of the growth-value spectrum. Lipper figures represent the average of the total returns reported by all of the mutual funds designated by Lipper, Inc. as falling into the respective categories indicated. Index returns shown do not reflect taxes, sales charges, expenses or other fees that the SEC requires to be reflected in the Fund’s performance. Indexes are unmanaged, and unlike the Fund, are not affected by cash-flows. It is not possible to invest directly in an index or an average.

(For the period ended December 31, 2006)

		Start of
	1 Year	Performance(1)

Return Before Taxes	17.61%	8.67%

S&P 500/CV	18.02%	8.34%

LLCVFA	18.00%	8.95%

(1) The Fund’s start of performance date was May 31, 2002.

Fees and Expenses

This table describes the fees and expenses that you may pay if you buy and hold Shares of the Fund.

Shareholder Fees

		The Fund

Fees Paid Directly From Your Investment		N/A

Annual Fund Operating Expenses

Expenses That are Deducted From Fund Assets
(as a percentage of average net assets)

		The Fund

Management Fee(1)(2)		0.70%

Distribution (12b-1) Fee		0.25%

Other Expenses(3)		1.07%

Total Direct Annual Fund Operating Expenses
(before contractual waiver and reimbursement)		2.02%

Acquired Fund Fees and Expenses(4)		0.03%

Total Direct and Acquired Annual Fund Operating
Expenses (before contractual waiver and reimbursement)		2.05%

Total Waiver and Reimbursement of
Fund Expenses (contractual)(1)		1.02%

Total Direct and Acquired Annual Fund Operating
Expenses (after contractual waiver and reimbursement)		1.03%

(1)		The Advisor agreed to contractually waive all or a portion of its investment advisory fee (based on average daily net assets) to which it is otherwise entitled to receive and/or reimburse certain operating expenses of the Fund in order to limit the Fund’s total Direct Annual Fund operating expenses to not more than 1.00% of the Fund’s average daily net assets through April 30, 2008.

(2)		To comply with the investment advisory agreement, the Advisor waived its management fee. The management fee paid by the Fund (after contractual waiver) was 0.00% for the fiscal year ended December 31, 2006.

(3)		Includes a shareholder services fee/account administration fee which is used to compensate intermediaries for shareholder services or account administrative services. Also includes a recordkeeping fee which is used to compensate intermediaries for recordkeeping services. Total other expenses paid by the Fund (after contractual reimbursement) were 0.75% for the fiscal year ended December 31, 2006.

(4)		The Fund’s shareholders indirectly bear the expenses of the acquired funds in which the Fund invests. The Fund’s indirect expenses from investing in the acquired funds is based upon the average allocation of the Fund’s investments in the acquired funds and upon the actual operating expenses of the acquired funds (including any current waivers and expense limitations) from their most recent shareholder report dated October 31, 2006. Actual acquired fund expenses incurred by the Fund may vary with changes in the allocation of the Fund’s assets among the acquired funds and with other events that directly affect the expenses of the acquired funds.

Example

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.

1 Year	3 Years	5 Years	10 Years

$105	$328	$569	$1,259

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MTB MANAGED ALLOCATION FUND – CONSERVATIVE GROWTH II

CUSIP: 55376V820

Goal

To seek capital appreciation and income.

Strategy

The Fund seeks to achieve its objective by investing in a combination of underlying MTB Funds (Underlying Funds) managed by the Advisor. The Fund’s assets are allocated among Underlying Funds that invest primarily in the three asset classes shown below so that the Fund normally has exposure to each of these asset classes. The amount allocated among the Underlying Funds will vary from time to time in an attempt to achieve the Fund’s goal based upon the Advisor’s view of economic conditions. The largest allocations normally are to Underlying Funds that invest primarily in Fixed Income Securities (Underlying Fixed Income Funds), but at times the amount allocated to Underlying Funds that invest primarily in Equity Securities (Underlying Equity Funds) and money market funds (Underlying Money Market Funds) can be higher than the amount in Underlying Fixed Income Funds. Each Underlying Equity Fund employs a growth, value or blended style of investing and, together, the Underlying Equity Funds invest in companies representing a wide range of market capitalizations. For further information regarding the Underlying Funds, see “Summary of Goals, Strategies, and Risks of the Underlying Funds.”

Certain of the Underlying Funds invest in Foreign Securities and below investment grade securities (junk bonds). In addition, certain of the Underlying Funds invest in securities of U.S. government-sponsored entities (GSEs), including GSE securities that are not backed by the full faith and credit of the United States government, such as those issued by the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, and the Federal Home Loan Bank System. These entities are, however, supported through federal subsidies, loans or other benefits. An Underlying Fund may also invest in GSE securities that are supported by the full faith and credit of the U.S. government, such as those issued by the Government National Mortgage Association. Finally, an Underlying Fund may invest in a few GSE securities that have no explicit financial support, but which are regarded as having implied support because the federal government sponsors their activities. Such securities include those issued by the Farm Credit System and the Financing Corporation.

The Fund currently plans to invest in shares of the following Underlying Funds within the percentage ranges indicated:

		INVESTMENT RANGE
		(Percentage of the Managed Allocation Fund –
ASSET CLASS		Conservative Growth II Assets)

MONEY MARKET FUNDS		0-50%
Money Market Fund
Prime Money Market Fund
U.S. Treasury Money Market Fund

FIXED INCOME FUNDS		35-70%
Intermediate-Term Bond Fund
Income Fund
Short Duration Government Bond Fund
Short-Term Corporate Bond Fund
U.S. Government Bond Fund

EQUITY FUNDS		5-50%
Equity Income Fund
International Equity Fund
Large Cap Growth Fund
Large Cap Stock Fund
Large Cap Value Fund
Mid Cap Growth Fund
Mid Cap Stock Fund
Small Cap Growth Fund
Small Cap Stock Fund

Risks

Equity Securities involve stock market risk, risks related to investing for growth and/or value, and risks related to company size. Fixed Income Securities involve interest rate risks, credit risks, call risks, and prepayment risks. Foreign Securities involve risks of foreign investing, and junk bonds involve risks associated with non-investment grade securities. Following are the principal risks associated with an investment in the Fund:

Stock Market Risk – The risk posed by the fact that the values of equity securities rise and fall.
Risks Related to Investing for Growth – Due to their relatively high valuations, growth stocks are typically more volatile than value stocks.
Risks Related to Investing for Value – Due to their relatively low valuations, value stocks are typically less volatile than growth stocks and therefore may lag behind growth stocks in an up market.
Risk Related to Company Size – The risk posed by mid- and small-market capitalization companies tending to have fewer shareholders, less liquidity, more volatility, unproven track records, limited product or service base and limited access to capital. These risks are greater for small-market capitalization stocks.
Interest Rate Risks – The risk posed by the fact that prices of fixed income securities rise and fall inversely in response to interest rate changes. In addition, this risk increases with the length of the maturity of the debt. Generally, prices of fixed income securities fall when interest rates rise and vice versa.
Risks associated with Non-Investment Grade Securities – Securities rated below investment grade generally entail greater interest rate and credit risks than investment grade securities.
Credit Risks – The possibility that an issuer will default on a security by failing to pay interest or principal when due.
Call Risks – The possibility that an issuer may redeem a fixed income security before maturity at a price below its current market price.
Prepayment Risks – The risk posed by the relative volatility of mortgage-backed securities. The likelihood of prepayments increases in a declining interest rate environment and decreases in a rising interest rate environment. This adversely affects the value of these securities.
Risks of Foreign Investing – Foreign economic, political or regulatory conditions may be less favorable than those of the United States.
Expenses of Investing in Other Funds – Mutual fund portfolios bear expenses for advisory fees and operational expenses. The Fund and the Underlying Funds in which it will invest will each bear these expenses, so investors in the Fund may bear higher expenses than a fund that invests directly in equity, fixed income or money market securities. These estimated expenses of the Underlying Funds are disclosed in a separate line in the fee table (Annual Fund Operating Expenses).

Performance Information

Risk/Return Bar Chart and Average Annual Total Return Table

The performance information shown below will help you analyze the Fund’s investment risks in light of its historical return. The bar chart shows the Fund’s total return on a calendar year basis. The Average Annual Total Return table shows returns averaged over the stated period, and includes comparative performance information. The Fund’s performance will fluctuate, and past performance is no guarantee of future results.

Risk/Return Bar Chart

Best Quarter
   2.68%
   12/31/2006

Worst Quarter
   (0.21)%
   6/30/2006

The Fund’s Shares are sold without a sales charge (load). The total return shown in the bar chart above is based upon net asset value and does not reflect the charges and expenses of a variable annuity or variable life insurance contract. If these charges or fees had been included, the return would have been lower.

The Fund’s total return for the three-month period from January 1, 2007 to March 31, 2007 was 1.51%.

Average Annual Total Return

Return Before Taxes is shown. The table also shows returns for the Lehman Brothers Aggregate Bond Index (LBAB) and Standard & Poor’s 500 Index (S&P 500), broad-based market indexes. The LBAB is an unmanaged index composed of securities from Lehman Brothers Government/Corporate Bond Index, Mortgage-Backed Securities Index and the Asset-Backed Securities Index. The S&P 500 is an unmanaged capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. Index returns shown do not reflect taxes, sales charges, expenses or other fees that the Securities and Exchange Commission (SEC) requires to be reflected in the Fund’s performance. Indexes are unmanaged and, unlike the Fund, are not affected by cashflows. It is not possible to invest directly in an index.

(For the period ended December 31, 2006)

		Start of
	1 Year	Performance(1)

Return Before Taxes	6.96%	6.13%

LBAB	4.33%	3.53%

S&P 500	15.79%	14.96%

(1) The Fund’s start of performance date was May 3, 2005.

Fees and Expenses

This table describes the fees and expenses that you may pay if you buy and hold Shares of the Fund.

Shareholder Fees

		The Fund

Fees Paid Directly From Your Investment		N/A

Annual Fund Operating Expenses

Expenses That are Deducted From Fund Assets
(as a percentage of average net assets)

		The Fund

Management Fee(1)(2)		0.25%

Distribution (12b-1) Fee		0.25%

Other Expenses(3)		8.61%

Total Direct Annual Fund Operating Expenses
(before contractual waiver and reimbursement)		9.11%

Acquired Fund Fees and Expenses(4)		0.83%

Total Direct and Acquired Annual Fund Operating
Expenses (before contractual waiver and reimbursement)		9.94%

Total Waiver and Reimbursement of Fund
Expenses (contractual)(1)		8.37%

Total Direct and Acquired Annual Fund Operating
Expenses (after contractual waiver and reimbursement)		1.57%

(1)		The Advisor agreed to contractually waive all or a portion of its investment advisory fee (based on average daily net assets) to which it is otherwise entitled to receive and/or reimburse certain operating expenses of the Fund in order to limit the Fund’s total Direct Annual Fund operating expenses to not more than 0.74% of the Fund’s average daily net assets through April 30, 2008.

(2)		To comply with the investment advisory agreement, the Advisor waived its management fee. The management fee paid by the Fund (after contractual waiver) was 0.00% for the fiscal year ended December 31, 2006.

(3)		Includes a shareholder services fee/account administration fee which is used to compensate intermediaries for shareholder services or account administrative services. Also includes a recordkeeping fee which is used to compensate intermediaries for recordkeeping services. Total other operating expenses paid by the Fund (after contractual reimbursement) were 0.49% for the fiscal year ended December 31, 2006.

(4)		The Fund’s shareholders indirectly bear the expenses of the acquired funds in which the Fund invests. The Fund’s indirect expenses from investing in the acquired funds is based upon the average allocation of the Fund’s investments in the acquired funds and upon the actual operating expenses of the acquired funds (including any current waivers and expense limitations) from their most recent shareholder report dated October 31, 2006. Actual acquired fund expenses incurred by the Fund may vary with changes in the allocation of the Fund’s assets among the acquired funds and with other events that directly affect the expenses of the acquired funds. For the six months ended October 31, 2006 (the semi-fiscal year period of the acquired funds), the ranges of such total operating expenses of the acquired funds, by category, were as follows: Money Market Funds: 0.42%; Fixed Income Funds: 0.67% to 0.74%; and Equity Funds: 0.99% to 1.46%.

Example

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.

1 Year	3 Years	5 Years	10 Years

$160	$496	$855	$1,867

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MTB MANAGED ALLOCATION FUND – MODERATE GROWTH II

CUSIP: 55376T577

Goal

To seek capital appreciation and, secondarily, income.

Strategy

The Fund seeks to achieve its objective by investing in a combination of underlying MTB Funds (Underlying Funds) managed by the Advisor. The Fund’s assets are allocated among Underlying Funds that invest primarily in the three asset classes shown below so that the Fund normally has exposure to each of these asset classes. The amount allocated among the Underlying Funds will vary from time to time in an attempt to achieve the Fund’s goal based upon the Advisor’s view of economic conditions. The largest allocations normally are to Underlying Funds that invest primarily in equity securities (Underlying Equity Funds), but at times the amount allocated to Underlying Funds that invest primarily in fixed income securities (Underlying Fixed Income Funds) and money market funds (Underlying Money Market Funds) can be higher than the amount in equities. Each Underlying Equity Fund employs a growth, value or blended style of investing and, together, the Underlying Equity Funds invest in companies representing a wide range of market capitalizations. For further information regarding the Underlying Funds, see “Summary of Goals, Strategies, and Risks of the Underlying Funds.”

The Fund currently plans to invest in shares of the following Underlying Funds within the percentage ranges indicated:

		INVESTMENT RANGE
		(Percentage of the Managed Allocation Fund –
ASSET CLASS		Moderate Growth II Assets)

MONEY MARKET FUNDS		0-45%
Money Market Fund
Prime Money Market Fund
U.S. Treasury Money Market Fund

FIXED INCOME FUNDS		15-50%
Income Fund
Intermediate-Term Bond Fund
Short Duration Government Bond Fund
Short-Term Corporate Bond Fund
U.S. Government Bond Fund

EQUITY FUNDS		40-70%
Equity Income Fund
International Equity Fund
Large Cap Growth Fund
Large Cap Stock Fund
Large Cap Value Fund
Mid Cap Growth Fund
Mid Cap Stock Fund
Small Cap Stock Fund
Small Cap Growth Fund

Risks

Stock Market Risk – The risk posed by the fact that the values of equity securities rise and fall.
Risks Related to Investing for Growth – Due to their relatively high valuations, growth stocks are typically more volatile than value stocks.
Risks Related to Investing for Value – Due to their relatively low valuations, value stocks are typically less volatile than growth stocks and therefore may lag behind growth stocks in an up market.
Risk Related to Company Size – The risk posed by mid- and small-market capitalization companies tending to have fewer shareholders, less liquidity, more volatility, unproven track records, limited product or service base and limited access to capital. These risks are greater for small-market capitalization stocks.
Interest Rate Risks – The risk posed by the fact that prices of fixed income securities rise and fall inversely in response to interest rate changes. In addition, this risk increases with the length of the maturity of the debt. Generally, prices of fixed income securities fall when interest rates rise and vice versa.
Credit Risks – The possibility that an issuer will default on a security by failing to pay interest or principal when due.
Risks associated with Non-Investment Grade Securities – Securities rated below investment grade generally entail greater interest rate and credit risks than investment grade securities.
Call Risks – The possibility that an issuer may redeem a fixed income security before maturity at a price below its current market price.
Prepayment Risks – The risk posed by the relative volatility of mortgage-backed securities. The likelihood of prepayments increases in a declining interest rate environment and decreases in a rising interest rate environment. This adversely affects the value of these securities.
Risks of Foreign Investing – Foreign economic, political or regulatory conditions may be less favorable than those of the United States.
Expenses of Investing in Other Funds – Mutual fund portfolios bear expenses for advisory fees and operational expenses. The Fund and the Underlying Funds in which it will invest will each bear these expenses, so investors in the Fund may bear higher expenses than a fund that invests directly in equity, fixed income or money market securities. These estimated expenses of the Underlying Funds are disclosed in a separate line in the fee table (Annual Fund Operating Expenses).

Performance Information
Risk/Return Bar Chart and Average Annual Total Return Table

Risk/Return Bar Chart

Best Quarter
   10.01%
   6/30/2003

Worst Quarter
   (2.10)%
   3/31/2003

The Fund’s Shares are sold without a sales charge (load). The total returns shown in the bar chart above are based upon net asset value and do not reflect the charges and expenses of a variable annuity or variable life insurance contract. If these charges or fees had been included, the returns would have been lower.

The Fund’s total return for the three-month period from January 1, 2007 to March 31, 2007 was 1.78%.

Average Annual Total Return Table

Return Before Taxes is shown. The table also shows returns for the Standard & Poor’s 500 Index (S&P 500) and Lehman Brothers Aggregate Bond Index (LBAB), broad-based market indexes. The S&P 500 is an unmanaged capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The LBAB is an unmanaged index composed of securities from Lehman Brothers Government/Corporate Bond Index, Mortgage-Backed Securities Index and the Asset-Backed Securities Index. Index returns shown do not reflect taxes, sales charges, expenses or other fees that the SEC requires to be reflected in the Fund’s performance. Indexes are unmanaged and, unlike the Fund, are not affected by cashflows. It is not possible to invest directly in an index.

(For the period ended December 31, 2006)

		Start of
	1 Year	Performance(1)

Return Before Taxes	10.42%	6.48%

S&P 500	15.79%	9.12%

LBAB	4.33%	4.72%

(1) The Fund’s start of performance date was June 17, 2002.

Fees and Expenses

This table describes the fees and expenses that you may pay if you buy and hold Shares of the Fund.

Shareholder Fees

		The Fund

Fees Paid Directly From Your Investment		N/A

Annual Fund Operating Expenses

Expenses That are Deducted From Fund Assets
(as a percentage of average net assets)

		The Fund

Management Fee(1)(2)		0.25%

Distribution (12b-1) Fee		0.25%

Other Expenses(3)		0.33%

Total Direct Annual Fund Operating Expenses
(before contractual waiver)		0.83%

Acquired Fund Fees and Expenses(4)		1.01%

Total Direct and Acquired Annual Fund Operating
Expenses (before contractual waiver)		1.84%

Total Waiver of Fund Expenses (contractual)(1)		0.09%

Total Direct and Acquired Annual Fund Operating
Expenses (after contractual waiver)		1.75%

(1)		The Advisor agreed to contractually waive all or a portion of its investment advisory fee (based on average daily net assets) to which it is otherwise entitled to receive and/or reimburse certain operating expenses of the Fund in order to limit the Fund’s total Direct Annual Fund operating expenses to not more than 0.74% of the Fund’s average daily net assets through April 30, 2008.

(2)		To comply with the investment advisory agreement, the Advisor waived a portion of its management fee. The management fee paid by the Fund (after contractual waiver) was 0.16% for the fiscal year ended December 31, 2006.

(3)		Includes a shareholder services fee/account administration fee which is used to compensate intermediaries for shareholder services or account administrative services. Also includes a recordkeeping fee which is used to compensate intermediaries for recordkeeping services.

(4)		The Fund’s shareholders indirectly bear the expenses of the acquired funds in which the Fund invests. The Fund’s indirect expenses from investing in the acquired funds is based upon the average allocation of the Fund’s investments in the acquired funds and upon the actual operating expenses of the acquired funds (including any current waivers and expense limitations) from their most recent shareholder report dated October 31, 2006. Actual acquired fund expenses incurred by the Fund may vary with changes in the allocation of the Fund’s assets among the acquired funds and with other events that directly affect the expenses of the acquired funds. For the six months ended October 31, 2006 (the semi-fiscal year period of the acquired funds), the ranges of such total operating expenses of the acquired funds, by category, were as follows: Money Market Funds: 0.42%; Fixed Income Funds: 0.67% to 0.84%; and Equity Funds: 1.00% to 1.46%.

Example

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.

The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your Shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund’s operating expenses are based upon the Total Direct and Acquired Annual Fund Operating Expenses (after contractual waiver), as shown in the table, and remain the same. Although your actual costs and returns may be higher or lower, based on these assumptions your costs would be:

1 Year	3 Years	5 Years	10 Years

$178	$551	$949	$2,062

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MTB MANAGED ALLOCATION FUND – AGGRESSIVE GROWTH II

CUSIP: 55376V812

Goal

To seek capital appreciation.

Strategy

The Fund seeks to achieve its objective by investing in a combination of underlying MTB Funds (Underlying Funds) managed by the Advisor. The Fund’s assets are allocated among Underlying Funds that invest primarily in the three asset classes shown below so that the Fund normally has exposure to each of these asset classes. The amount allocated among the Underlying Funds will vary from time to time in an attempt to achieve the Fund’s goal based upon the Advisor’s view of economic conditions. The largest allocations normally are to Underlying Equity Funds. Each Underlying Equity Fund employs a growth, value or blended style of investing and, together, the Underlying Equity Funds invest in companies representing a wide range of market capitalizations. For further information regarding the Underlying Funds, see “Summary of Goals, Strategies, and Risks of the Underlying Funds.”

The Fund currently plans to invest in shares of the following Underlying Funds within the percentage ranges indicated:

		INVESTMENT RANGE
		(Percentage of the Managed Allocation Fund –
ASSET CLASS		Aggressive Growth II Assets)

MONEY MARKET FUNDS		0-20%
Money Market Fund
Prime Money Market Fund
U.S. Treasury Money Market Fund

FIXED INCOME FUNDS		0-30%
Income Fund
Intermediate-Term Bond Fund
Short Duration Government Bond Fund
Short-Term Corporate Bond Fund
U.S. Government Bond Fund

EQUITY FUNDS		70-100%
Equity Income Fund
International Equity Fund
Large Cap Growth Fund
Large Cap Stock Fund
Large Cap Value Fund
Mid Cap Growth Fund
Mid Cap Stock Fund
Small Cap Growth Fund
Small Cap Stock Fund

Risks

Stock Market Risk – The risk posed by the fact that the values of equity securities rise and fall.
Risks Related to Investing for Growth – Due to their relatively high valuations, growth stocks are typically more volatile than value stocks.
Risks Related to Investing for Value – Due to their relatively low valuations, value stocks are typically less volatile than growth stocks and therefore may lag behind growth stocks in an up market.
Risk Related to Company Size – The risk posed by mid- and small-market capitalization companies tending to have fewer shareholders, less liquidity, more volatility, unproven track records, limited product or service base and limited access to capital. These risks are greater for small-market capitalization stocks.
Interest Rate Risks – The risk posed by the fact that prices of fixed income securities rise and fall inversely in response to interest rate changes. In addition, this risk increases with the length of the maturity of the debt. Generally, prices of fixed income securities fall when interest rates rise and vice versa.
Credit Risks – The possibility that an issuer will default on a security by failing to pay interest or principal when due.
Risks associated with Non-Investment Grade Securities – Securities rated below investment grade generally entail greater interest rate and credit risks than investment grade securities.
Call Risks – The possibility that an issuer may redeem a fixed income security before maturity at a price below its current market price.
Prepayment Risks – The risk posed by the relative volatility of mortgage-backed securities. The likelihood of prepayments increases in a declining interest rate environment and decreases in a rising interest rate environment. This adversely affects the value of these securities.
Risks of Foreign Investing – Foreign economic, political or regulatory conditions may be less favorable than those of the United States.
Expenses of Investing in Other Funds – Mutual fund portfolios bear expenses for advisory fees and operational expenses. The Fund and the Underlying Funds in which it will invest will each bear these expenses, so investors in the Fund may bear higher expenses than a fund that invests directly in equity, fixed income or money market securities. These estimated expenses of the Underlying Funds are disclosed in a separate line in the fee table (Annual Fund Operating Expenses).

Performance Information

Risk/Return Bar Chart and Average Annual Total Return Table

Risk/Return Bar Chart

Best Quarter
   7.25%
   12/31/2006

Worst Quarter
   (2.54)%
   6/30/2006

The Fund’s total return for the three-month period from January 1, 2007 to March 31, 2007 was 2.04%.

Average Annual Total Return Table

(For the period ended December 31, 2006)

		Start of
	1 Year	Performance(1)

Return Before Taxes	14.83%	13.91%

S&P 500	15.79%	14.96%

LBAB	4.33%	3.53%

(1) The Fund’s start of performance date was May 3, 2005.

Fees and Expenses

This table describes the fees and expenses that you may pay if you buy and hold Shares of the Fund.

Shareholder Fees

		The Fund

Fees Paid Directly From Your Investment		N/A

Annual Fund Operating Expenses

Expenses That are Deducted From Fund Assets
(as a percentage of average net assets)

		The Fund

Management Fee(1)(2)		0.25%

Distribution (12b-1) Fee		0.25%

Other Expenses(3)		6.11%

Total Direct Annual Fund Operating Expenses
(before contractual waiver and reimbursement)		6.61%

Acquired Fund Fees and Expenses(4)		1.18%

Total Direct and Acquired Annual Fund
Operating Expenses (before contractual waiver and reimbursement)		7.79%

Total Waiver and Reimbursement of Fund
Expenses (contractual)(1)		5.87%

Total Direct and Acquired Annual Fund
Operating Expenses (after contractual waiver and reimbursement)		1.92%

(1)		The Advisor agreed to contractually waive all or a portion of its investment advisory fee (based on average daily net assets) to which it is otherwise entitled to receive and/or reimburse certain operating expenses of the Fund in order to limit the Fund’s total Direct Annual Fund operating expenses to not more than 0.74% of the Fund’s average daily net assets through April 30, 2008.

(2)		To comply with the investment advisory agreement, the Advisor waived its management fee. The management fee paid by the Fund (after contractual waiver) was 0.00% for the fiscal year ended December 31, 2006.

(3)		Includes a shareholder services fee/account administration fee which is used to compensate intermediaries for shareholder services or account administrative services. Also includes a recordkeeping fee which is used to compensate intermediaries for recordkeeping services. Total other operating expenses paid by the Fund (after contractual reimbursement) were 0.49% for the fiscal year ended December 31, 2006.

(4)		The Fund’s shareholders indirectly bear the expenses of the acquired funds in which the Fund invests. The Fund’s indirect expenses from investing in the acquired funds is based upon the average allocation of the Fund’s investments in the acquired funds and upon the actual operating expenses of the acquired funds (including any current waivers and expense limitations) from their most recent shareholder report dated October 31, 2006. Actual acquired fund expenses incurred by the Fund may vary with changes in the allocation of the Fund’s assets among the acquired funds and with other events that directly affect the expenses of the acquired funds. For the six months ended October 31, 2006 (the semi-fiscal year period of the acquired funds), the ranges of such total operating expenses of the acquired funds, by category, were as follows: Money Market Funds: 0.42%; Fixed Income Funds: 0.67% to 0.73%; and Equity Funds: 1.00% to 1.46%.

Example

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.

1 Year	3 Years	5 Years	10 Years

$195	$603	$1,037	$2,243

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Summary of Goals, Strategies and Risks of the Underlying Funds

A summary of the goals, strategies and risks of the Underlying Funds is set forth below. Capitalized terms are defined under the captions “Principal Securities of the Funds” and “Specific Risks of Investing in the Funds.” Additional information on each Underlying Fund can be found in the other MTB Funds prospectuses, which are available by calling (800) 836-2211. Each Underlying Fund is available for investment directly by the general public.

Underlying Money Market Funds

Goals. The goal of each Underlying Money Market Fund is to seek current income with liquidity and stability of principal by investing in high quality money market instruments. Each Underlying Money Market Fund seeks to maintain a constant net asset value of $1.00 per share for purchases and redemptions.

Strategies. U.S. Treasury Money Market Fund invests primarily in Treasury Securities and Repurchase Agreements secured by Treasury Securities. Prime Money Market Fund invests primarily in Bank Instruments, Corporate Debt Securities, Municipal Securities, Variable Rate Demand Instruments, Mortgage-Backed Securities, Asset-Backed Securities, Treasury Securities, Agency Securities and Repurchase Agreements. Money Market Fund invests primarily in Treasury Securities, Agency Securities, Corporate Debt Securities and Bank Instruments.

Risks. The principal risks applicable to Underlying Money Market Funds are, in the case of U.S. Treasury Money Market Fund, Interest Rate Risks and Call Risks; and in the case of Prime Money Market Fund and Money Market Fund, Interest Rate Risks, Call Risks, Credit Risks, Prepayment Risks and Risks of Foreign Investing.

Underlying Fixed Income Funds

Goals. The goal of each Underlying Fixed Income Fund is to seek current income. Capital appreciation is a secondary goal of Intermediate-Term Bond Fund and U.S. Government Bond Fund, while preservation of capital is a secondary goal of Short Duration Government Bond Fund. Capital growth is a secondary goal of the Income Fund.

Strategies – Principal Securities. Intermediate-Term Bond Fund, Income Fund and Short-Term Corporate Bond Fund may invest primarily in Treasury Securities, Agency Securities, Corporate Debt Securities, Mortgage-Backed Securities, Collateralized Mortgage Obligations, Asset-Backed Securities and Bank Instruments. Short Duration Government Bond Fund and U.S. Government Bond Fund may invest primarily in Treasury Securities and Agency Securities.

Strategies – Duration/Maturity. Under normal market conditions, each of the Underlying Fixed Income Funds seek to maintain certain duration or dollar-weighted average maturity ranges. Short Duration Government Bond Fund seeks to maintain an average duration of less than three years. Duration measures the price sensitivity of a fixed income security to changes in interest rates. Intermediate-Term Bond Fund seeks to maintain a dollar-weighted average maturity of 3 to 10 years. U.S. Government Bond Fund will invest primarily in fixed income securities having maturities greater than one year. Income Fund seeks to maintain a dollar-weighted average maturity of 4 to 20 years. Short-Term Corporate Bond Fund seeks to maintain a dollar-weighted average maturity of no more than 3 years.

Risks. The principal risks applicable to Underlying Fixed Income Funds are Interest Rate Risks, Credit Risks, Call Risks, Prepayment Risks and Risks Associated with Non-Investment Grade Securities.

Underlying Equity Funds

Goals. The goal of each Underlying Equity Fund is to provide capital appreciation, although the primary goal, in the case of Large Cap Value Fund, and the secondary goal, in the case of Mid Cap Stock Fund, is current income.

Strategies – Principal Securities. Each Underlying Equity Fund invests primarily in Equity Securities and Convertible Securities, which, in the case of International Equity Fund, include primarily Foreign Securities.

Strategies – Market Capitalization. Large Cap Growth Fund, Large Cap Value Fund and Large Cap Stock Fund each invests primarily in “large cap” securities of companies that have a market capitalization at time of purchase within the market capitalization range of companies in a recognized independent large-cap index such as the S&P 500 Index. As of December 31, 2006, the smallest company in the index had a market capitalization of $1.4 billion, the largest company in the index had a market capitalization of $447.0 billion, and the weighted average market capitalization in the index was $25.5 billion. The capitalization range is as of December 31, 2006, and is subject to change. Mid Cap Stock Fund and Mid Cap Growth Fund invest primarily in “mid cap” securities of companies that have a market capitalization at time of purchase within the market capitalization range of companies in recognized independent mid-cap indexes such as the S&P Mid Cap 400 Index and the Russell Mid Cap Index. As of December 31, 2006, the smallest company in the S&P Mid Cap 400 Index had a market capitalization of $500.0 million, the largest company in the S&P Mid Cap 400 Index had a market capitalization of $10.6 billion, and the weighted average market capitalization of the S&P Mid Cap 400 Index was $2.8 billion. As of January 31, 2007, the largest company in the Russell Mid Cap Index had a market capitalization of $20.3 billion, and the weighted average market capitalization of the Russell Mid Cap Index was $8.7 billion. The capitalization ranges are as of December 31, 2006, and January 31, 2007, respectively, and are subject to change. Small Cap Stock Fund and Small Cap Growth Fund invest primarily in “small cap” securities of companies that have a market capitalization at time of purchase within the market capitalization range of companies in recognized independent small-cap indexes such as the S&P 600 Index and the Russell 2000 Index. As of December 31, 2006, the smallest company in the S&P 600 Index had a market capitalization of $70.0 million, the largest company in the S&P 600 Index had a market capitalization of $3.7 billion, and the weighted average market capitalization in the S&P 600 Index was $970.0 million. As of January 31, 2007, the largest company in the Russell 2000 Index had a market capitalization of $3.4 billion, and the weighted average market capitalization in the Russell 2000 Index was $1.2 million. The capitalization ranges are as of December 31, 2006, and January 31, 2007, respectively, and are subject to change.

Strategies – Style Orientation. International Equity Fund, Large Cap Value Fund and Equity Income Fund use a “value” oriented approach, seeking companies whose stock prices do not appear to reflect their underlying value as measured by assets, earnings, cash flow, business franchises, or other quantitative or qualitative measures. Large Cap Growth Fund, Small Cap Growth Fund and Mid Cap Growth Fund use a “growth” oriented approach, seeking stocks with high earnings growth which, in the opinion of the Advisor, will lead to appreciation in stock price. Small Cap Stock Fund, Mid Cap Stock Fund and Large Cap Stock Fund use a “blended” approach, using a growth-based strategy or value-based strategy (or both), as market conditions dictate.

Risks. The principal risks applicable to Underlying Equity Funds are Stock Market Risks, Risks Related to Investing for Growth, Risks Related to Investing for Value, Risks Related to Company Size and Risks of Foreign Investing.

Advisor’s Potential Conflict

In managing the three Managed Allocation Funds, the Advisor has the authority to select and substitute the Underlying Funds in which each Managed Allocation Fund will invest. The Advisor is subject to conflict of interest in allocating Managed Allocation Fund assets among the various Underlying Funds both because the fees payable to it and/or its affiliates by some Underlying Funds are higher than the fees payable by other Underlying Funds and because the Advisor is also primarily responsible for managing the Underlying Funds. The Trustees and officers may also have conflicting interests in fulfilling their fiduciary duties to both the Managed Allocation Funds and Underlying Funds.

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Principal Securities of the Funds

The principal securities of each Fund are marked with an “X”.

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	Conservative	Moderate	Aggressive	Large Cap	Large Cap
	Growth Fund II	Growth Fund II*	Growth Fund II*	Value Fund II	Growth Fund II

Equity Securities	X	X	X	X	X

Common Stocks	X	X	X	X	X

Preferred Stocks	X	X	X	X	X

Fixed Income Securities	X	X	X	X	X

Treasury Securities	X	X	X

Agency Securities	X	X	X

Corporate Debt Securities	X	X	X

Mortgage-Backed Securities	X	X	X

Collateralized Mortgage Obligations (CMOs)	X	X	X

Asset-Backed Securities	X	X	X

Zero Coupon Securities	X	X	X

Bank Instruments	X	X	X	X

Credit Enhancement	X	X	X

Convertible Securities				X	X

Municipal Securities	X	X	X

Municipal Notes	X	X	X

Tax-Exempt Securities	X	X	X

Foreign Securities	X	X	X	X

Depositary Receipts	X	X	X	X	X

Foreign Exchange Contracts	X	X	X

Foreign Government Securities	X	X	X

Derivative Contracts	X	X	X

Swap Contracts	X	X	X

Credit Default Swaps	X	X	X

Investing in Securities of Other Investment Companies	X	X	X	X	X

Non-Investment Grade Securities	X	X	X

Short Sales	X	X	X		X

* Through investment in the Underlying Funds

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The following list is a description of the principal securities in which the Funds may invest. More information on the principal and acceptable investments of the Funds is contained in the Funds’ Statement of Additional Information.

Equity Securities

Equity securities (stocks) represent a share of an issuer’s earnings and assets, after the issuer pays its liabilities. A Fund cannot predict the income it will receive from equity securities because issuers generally have discretion as to the payment of any dividends or distributions. However, equity securities offer greater potential for appreciation than many other types of securities, because their value increases directly with the value of the issuer’s business. The following describes the principal types of equity securities in which the Funds may invest.

Common Stocks

Common stocks are the most prevalent type of equity security. Common stocks receive the issuer’s earnings after the issuer pays its creditors and any preferred stockholders. As a result, changes in an issuer’s earnings directly influence the value of its common stock.

Preferred Stocks

Preferred stocks have the right to receive specified dividends or distributions before the issuer makes payments on its common stock. Some preferred stocks also participate in dividends and distributions paid on common stock.

Preferred stocks may also permit the issuer to redeem the stock. The Funds may also treat such redeemable preferred stock as a fixed income security.

Fixed Income Securities

Fixed income securities (bonds) pay interest, dividends or distributions at a specified rate. The rate may be a fixed percentage of the principal or adjusted periodically. In addition, the issuer of a fixed income security must repay the principal amount of the security, normally within a specified time. Fixed income securities provide more regular income than equity securities. However, the returns on fixed income securities are limited and normally do not increase with the issuer’s earnings. This limits the potential appreciation of fixed income securities as compared to equity securities.

A security’s yield measures the annual income earned on a security as a percentage of its price. A security’s yield will increase or decrease depending upon whether it costs less (a discount) or more (a premium) than the principal amount. If the issuer may redeem the security before its scheduled maturity, the price and yield on a discount or premium security may change based upon the probability of an early redemption. Securities with higher risks generally have higher yields.

The following describes the principal types of fixed income securities in which a Fund may invest.

Treasury Securities

Treasury securities are direct obligations of the federal government of the United States. Treasury securities are generally regarded as having the lowest credit risks.

Agency Securities

Agency securities are issued or guaranteed by a federal agency or other government sponsored entity (GSE) acting under federal authority. Some GSE securities are supported by the full faith and credit of the United States. These include Government National Mortgage Association, Small Business Administration, Farm Credit System Financial Assistance Corporation, Farmer’s Home Administration, Federal Financing Bank, General Services Administration, Department of Housing and Urban Development, Export-Import Bank, Overseas Private Investment Corporation, and Washington Metropolitan Area Transit Authority Bonds.

Other GSEs receive support through federal subsidies, loans or other benefits. For example, the U.S. Treasury is authorized to purchase specified amounts of securities issued by (or otherwise make funds available to) the Federal Home Loan Bank System, Federal Home Loan Mortgage Corporation, Federal National Mortgage Association, Student Loan Marketing Association, and Tennessee Valley Authority in support of such obligations.

A few GSEs have no explicit financial support, but are regarded as having implied support because the federal government sponsors their activities. These include the Farm Credit System, Financing Corporation, and Resolution Funding Corporation.

Investors regard agency securities as having low credit risks, but not as low as Treasury securities.

A Fund treats mortgage-backed securities guaranteed by a GSE as if issued or guaranteed by a federal agency. Although such a guarantee protects against credit risks, it does not reduce market and prepayment risks.

Corporate Debt Securities

Corporate debt securities are fixed income securities issued by businesses. Notes, bonds, debentures and commercial paper are the most prevalent types of corporate debt securities. A Fund may also purchase interests in bank loans to companies. The credit risks of corporate debt securities vary widely among issuers.

In addition, the credit risk of an issuer’s debt security may vary based on its priority for repayment. For example, higher ranking (senior) debt securities have a higher priority than lower ranking (subordinated) securities. This means that the issuer might not make payments on subordinated securities while continuing to make payments on senior securities. In addition, in the event of bankruptcy, holders of senior securities may receive amounts otherwise payable to the holders of subordinated securities. Some subordinated securities, such as trust preferred and capital securities notes, also permit the issuer to defer payments under certain circumstances. For example, insurance companies issue securities known as surplus notes that permit the insurance company to defer any payment that would reduce its capital below regulatory requirements.

Mortgage-Backed Securities

Mortgage-backed securities represent interests in pools of mortgages. The mortgages that comprise a pool normally have similar interest rates, maturities and other terms. Mortgages may have fixed or adjustable interest rates. Interests in pools of adjustable rate mortgages are known as ARMs.

Mortgage-backed securities come in a variety of forms. Many have extremely complicated terms. The simplest form of mortgage-backed securities are pass-through certificates. An issuer of pass-through certificates gathers monthly payments from an underlying pool of mortgages. Then, the issuer deducts its fees and expenses and passes the balance of the payments onto the certificate holders once a month. Holders of pass-through certificates receive a pro rata share of all payments and prepayments from the underlying mortgages. As a result, the holders assume all the prepayment risks of the underlying mortgages.

Collateralized Mortgage Obligations (CMOs)

CMOs, including interests in real estate mortgage investment conduits (REMICs), allocate payments and prepayments from an underlying pass-through certificate among holders of different classes of mortgage-backed securities. This creates different prepayment and interest rate risks for each CMO class.

Asset-Backed Securities

Asset-backed securities are payable from pools of obligations other than mortgages. Most asset-backed securities involve consumer or commercial debts with maturities of less than ten years. However, almost any type of fixed income assets (including other fixed income securities) may be used to create an asset-backed security.

Asset-backed securities may take the form of commercial paper, notes, or pass through certificates. Asset-backed securities have prepayment risks.

Zero Coupon Securities

Zero coupon securities do not pay interest or principal until final maturity unlike debt securities that provide periodic payments of interest (referred to as a coupon payment). Investors buy zero coupon securities at a price below the amount payable at maturity. The difference between the purchase price and the amount paid at maturity represents interest on the zero coupon security. Investors must wait until maturity to receive interest and principal, which increases the interest rate and credit risks of a zero coupon security.

Bank Instruments

Bank instruments are unsecured interest bearing deposits with banks. Bank instruments include bank accounts, time deposits, certificates of deposit and banker’s acceptances. Yankee instruments are denominated in U.S. dollars and issued by U.S. branches of foreign banks. Eurodollar instruments are denominated in U.S. dollars and issued by non-U.S. branches of U.S. or foreign banks.

Credit Enhancement

Credit enhancement consists of an arrangement in which a company agrees to pay amounts due on a fixed income security if the issuer defaults. In some cases the company providing credit enhancement makes all payments directly to the security holders and receives reimbursement from the issuer. Normally, the credit enhancer has greater financial resources and liquidity than the issuer. For this reason, the Advisor usually evaluates the credit risk of a fixed income security based solely upon its credit enhancement.

Convertible Securities

Convertible securities are fixed income securities that a Fund has the option to exchange for equity securities at a specified conversion price. The option allows a Fund to realize additional returns if the market price of the equity securities exceeds the conversion price. For example, a Fund may hold fixed income securities that are convertible into shares of common stock at a conversion price of $10 per share. If the market value of the shares of common stock reached $12, a Fund could realize an additional $2 per share by converting its fixed income securities.

Convertible securities have lower yields than comparable fixed income securities. In addition, at the time a convertible security is issued the conversion price exceeds the market value of the underlying equity securities. Thus, convertible securities may provide lower returns than non-convertible fixed income securities or equity securities depending upon changes in the price of the underlying equity securities. However, convertible securities permit a Fund to realize some of the potential appreciation of the underlying equity securities with less risk of losing its initial investment. The Funds may invest in convertible securities rated below investment grade. See “Risks Associated with Non-investment Grade Securities” herein.

The Funds treat convertible securities as both fixed income and equity securities for purposes of its investment policies and limitations, because of their unique characteristics.

Municipal Securities

Municipal securities are fixed income securities that pay interest that is not subject to regular federal income taxes. Typically, states, counties, cities and other political subdivisions and authorities issue tax exempt securities. The market categorizes tax exempt securities by their source of repayment.

Municipal Notes

Municipal notes are short-term tax exempt securities. Many municipalities issue such notes to fund their current operations before collecting taxes or other municipal revenues. Municipalities may also issue notes to fund capital projects prior to issuing long-term bonds. The issuers typically repay the notes at the end of their fiscal year, either with taxes, other revenues or proceeds from newly issued notes or bonds.

Tax-Exempt Securities

Tax-exempt securities are fixed income securities that pay interest that is not subject to regular federal income taxes. Typically, states, counties, cities and other political subdivisions and authorities issue tax-exempt securities. The market categorizes tax-exempt securities by their source of repayment. Interest income on such securities may be subject to the federal alternative minimum tax (AMT) for individuals and corporations.

Foreign Securities

Foreign securities are securities of issuers based outside the United States. An issuer is considered to be based outside the United States if:

it is organized under the laws of, or has a principal office located in, another country;
the principal trading market for its securities is in another country; or
it (or its subsidiaries) derived in its most current fiscal year at least 50% of its total assets, capitalization, gross revenue or profit from goods produced, services performed, or sales made in another country.

Foreign securities are primarily denominated in foreign currencies. Along with the risks normally associated with domestic securities of the same type, foreign securities are subject to currency risks and risks of foreign investing. Trading in certain foreign markets is also subject to liquidity risks.

Depositary Receipts

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Depositary receipts represent interests in Underlying securities issued by a foreign company. Depositary receipts are not traded in the same market as the underlying security. The foreign securities underlying American Depositary Receipts (ADRs) are traded outside the United States. ADRs provide a way to buy shares of foreign-based companies in the United States rather than in overseas markets. ADRs are also traded in U.S. dollars, eliminating the need for foreign exchange transactions. The foreign securities underlying European Depositary Receipts (EDRs), Global Depositary Receipts (GDRs), and International Depositary Receipts (IDRs), are traded globally or outside the United States. Depositary receipts involve many of the same risks of investing directly in foreign securities, including currency risks and risks of foreign investing.

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Foreign Exchange Contracts

In order to convert U.S. dollars into the currency needed to buy a foreign security, or to convert foreign currency received from the sale of a foreign security into U.S. dollars, the International Equity Fund (an “Underlying Fund”) may enter into spot currency trades. In a spot trade, the Underlying Fund agrees to exchange one currency for another at the current exchange rate. The Underlying Fund may also enter into derivative contracts in which a foreign currency is an underlying asset. The exchange rate for currency derivative contracts may be higher or lower than the spot exchange rate. Use of these derivative contracts may increase or decrease the Underlying Fund’s exposure to currency risks.

Foreign Government Securities

Foreign government securities generally consist of fixed income securities supported by national, state or provincial governments or similar political subdivisions. Foreign government securities also include debt obligations of supranational entities, such as international organizations designed or supported by governmental entities to promote economic reconstruction or development, international banking institutions and related government agencies. Examples of these include, but are not limited to, the International Bank for Reconstruction and Development (the World Bank), the Asian Development Bank, the European Investment Bank and the Inter-American Development Bank.

Further, foreign government securities include mortgage-related securities issued or guaranteed by national, state or provincial governmental instrumentalities, including quasi-governmental agencies.

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Derivative Contracts

Derivative contracts are financial instruments that require payments based upon changes in the values of designated (or underlying) securities, currencies, commodities, financial indices or other assets. Some derivative contracts (such as futures, forwards and options) require payments relating to a future trade involving the underlying asset. Other derivative contracts (such as swaps) require payments relating to the income or returns from the underlying asset. The other party to a derivative contract is referred to as a counterparty.

Many derivative contracts are traded on securities or commodities exchanges. In this case, the exchange sets all the terms of the contract except for the price. Investors make payments due under their contracts through the exchange. Most exchanges require investors to maintain margin accounts through their brokers to cover their potential obligations to the exchange. Parties to the contract make (or collect) daily payments to the margin accounts to reflect losses (or gains) in the value of their contracts. This protects investors against potential defaults by the counterpar-ty. Trading contracts on an exchange also allows investors to close out their contracts by entering into offsetting contracts.

For example, a Fund could close out an open contract to buy an asset at a future date by entering into an offsetting contract to sell the same asset on the same date. If the offsetting sale price is more than the original purchase price, the Fund realizes a gain; if it is less, the Fund realizes a loss. Exchanges may limit the amount of open contracts permitted at any one time. Such limits may prevent the Fund from closing out a position. If this happens, the Fund will be required to keep the contract open (even if it is losing money on the contract), and to make any payments required under the contract (even if it has to sell portfolio securities at unfavorable prices to do so). Inability to close out a contract could also harm the Fund by preventing it from disposing of or trading any assets it has been using to secure its obligations under the contract.

A Fund may also trade derivative contracts over-the-counter (OTC) in transactions negotiated directly between the Fund and the counterparty. OTC contracts do not necessarily have standard terms, so they cannot be directly offset with other OTC contracts. In addition, OTC contracts with more specialized terms may be more difficult to price than exchange traded contracts.

Depending upon how the Fund uses derivative contracts and the relationships between the market value of a derivative contract and the underlying asset, derivative contracts may increase or decrease the Fund’s exposure to interest rate and currency risks, and may also expose the Fund to liquidity and leverage risks. OTC contracts also expose the Fund to credit risks in the event that a counterparty defaults on the contract.

Certain Underlying Funds may trade in the following types of derivative contracts.

Swap Contracts

A swap contract (also known as a “swap”) is a type of derivative contract in which two parties (each, a “Counterparty”) agree to pay each other (swap) the returns derived from designated (or underlying) securities, currencies, commodities, financial indices or other assets (“Reference Instruments”). Swaps do not always involve the delivery of the Reference Instruments by either party, and the parties might not own the Reference Instruments underlying the swap. The payments are usually made on a net basis so that, on any given day, the Fund would receive (or pay) only the amount by which its payment under the contract is less than (or exceeds) the amount of the other party’s payment. Swap agreements are sophisticated instruments that can take many different forms and are known by a variety of names.

Credit Default Swaps

A credit default swap (CDS) is a type of swap agreement between two parties whereby one party (the “Protection Buyer”) agrees to make payments over the term of the CDS to the other party (the “Protection Seller”), provided that no designated event of default, restructuring or other credit related event (each a “Credit Event”) occurs with respect to the Reference Instrument, which is usually a particular bond or the unsecured credit of a particular issuer (the “Reference Obligation”). Many CDSs are physically settled, which means that if a Credit Event occurs, the Protection Seller must pay the Protection Buyer the full notional value, or “par value,” of the Reference Obligation in exchange for delivery by the Protection Buyer of the Reference Obligation or another similar obligation issued by the issuer of the Reference Obligation (the “Deliverable Obligation”). The Counterparties agree to the characteristics of the Deliverable Obligation at the time that they enter into the CDS. Alternately, a CDS can be “cash settled,” which means that upon the occurrence of a Credit Event, the Protection Buyer will receive a payment from the Protection Seller equal to the difference between the par amount of the Reference Obligation and its market value at the time of the Credit Event. The Fund may be either the Protection Buyer or the Protection Seller in a CDS. If the Fund is a Protection Buyer and no Credit Event occurs, the Fund will lose its entire investment in the CDS (i.e., an amount equal to the payments made to the Protection Seller over the term of the CDS). However, if a Credit Event occurs, the Fund (as Protection Buyer) will deliver the Deliverable Obligation and receive a payment equal to the full notional value of the Reference Obligation, even though the Reference Obligation may have little or no value. If the Fund is the Protection Seller and no Credit Event occurs, the Fund will receive a fixed rate of income throughout the term of the CDS. However, if a Credit Event occurs, the Fund (as Protection Seller) will pay the Protection Buyer the full notional value of the Reference Obligation and receive the Deliverable Obligation from the Protection Buyer. A CDS may involve greater risks than if the Fund invested directly in the Reference Obligation. For example, a CDS may increase credit risk since the Fund has exposure to both the issuer of the Reference Obligation and the Counterparty to the CDS. The Reference Instruments underlying each CDS will be of a credit quality at least equal to that of the credit quality required for investment in individual securities by the relevant Fund.

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Non-Investment Grade Securities

Securities rated BB+ or lower by Standard & Poor’s or Ba or lower by Moody’s are considered to be non-investment grade securities (junk bonds).

Investing in Securities of Other Investment Companies

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The Funds, and each Underlying Fund, may invest in securities of other investment companies, including exchange traded funds (ETF) and the securities of affiliated money market funds, as an efficient means of carrying out their investment policies and managing their uninvested cash. Conservative Growth Fund II, Moderate Growth Fund II and Aggressive Growth Fund II intend to invest substantially all of their assets in Underlying Funds in order to achieve their investment goals.

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The Shares of most ETFs are listed and traded on stock exchanges at market prices, although some Shares may be redeemable at net asset value for cash or securities. ETFs may be purchased in order to achieve exposure to a specific region, country or market sector, or for other reasons consistent with its investment strategy. As with traditional mutual funds, ETFs charge asset-based fees, although these fees tend to be relatively low. ETFs generally do not charge initial sales charges or redemption fees but investors pay customary brokerage commissions and fees to buy and sell ETF shares.

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Pursuant to an SEC exemption, each of the Funds is permitted to invest in shares of the MTB Money Market Funds as a means of managing their uninvested cash. These investments will cause a duplication of expenses. The Advisor may waive certain fees in connection with these investments.

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Other Investment Strategies

Portfolio Turnover

Large Cap Growth Fund II and Large Cap Value Fund II, and certain Underlying Funds, may actively trade their portfolio securities in an attempt to achieve their investment objectives. Active trading will cause a Fund to have an increased portfolio turnover rate, which is likely to generate shorter-term gains (losses) for its shareholders, which are taxed at a higher rate than longer-term gains (losses). Actively trading portfolio securities increases a Fund’s trading costs and may have an adverse impact on a Fund’s performance.

Temporary Defensive Investments

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The Large Cap Growth Fund II and Large Cap Value Fund II may temporarily depart from their principal investment strategies by investing their assets in cash and shorter-term debt securities and similar obligations. They may do this to minimize potential losses and maintain liquidity to meet shareholder redemptions during adverse market conditions. This may cause the Funds to fail to meet its investment objective and to give up greater investment returns to maintain the safety of principal, that is, the original amount invested by shareholders. Interest income from temporary investments may be taxable to shareholders as ordinary income.

Short Sales

The Large Cap Growth Fund II and certain Underlying Funds may make short sales of securities listed on one or more national exchanges or on the Nasdaq Stock Market. A short sale is the sale of a stock that the Fund does not own (or will borrow for delivery), because the Fund believes the stock will decline in price or the Fund wants to hedge against potential price volatility of the stock. If the price of the stock declines, the Fund can buy the stock at a lower price and will make a profit. If the price of the stock rises, the Fund will incur a loss. When the Fund sells short, it borrows the stock from a broker “on margin”, and must pay interest to the broker on the margin amount until the stock is replaced by the Fund. In no event will the Fund engage in short sales transactions if it would cause the market value of all of the Fund’s securities sold short to exceed 25% of its net assets. The value of the securities of any one issuer that may be shorted by the Fund is limited to the lesser of 2% of the value of the Fund’s net assets. The Fund may also “sell short against the box,” i.e., the Fund owns securities identical to those short. Short sales against the box are not subject to the 25% limitation. Short sales are speculative in nature, and may reduce returns or increase volatility. Short sales involve Close Out Risks and Leverage Risks.

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Investment Ratings for Investment Grade Securities

The Advisor or Sub-advisor will determine whether a security is investment grade based upon the credit ratings given by one or more nationally recognized rating services. For example, Standard and Poor’s, a rating service, assigns ratings to investment grade securities (AAA, AA, A, and BBB) based on their assessment of the likelihood of the issuer’s inability to pay interest or principal (default) when due on each security. Lower credit ratings correspond to higher credit risk. If a security has not received a rating, the Funds must rely entirely upon the Advisor’s or Sub-advisor’s credit assessment that the security is comparable to investment grade.

Specific Risks of Investing in the Funds

Stock Market Risks

The value of equity securities in a Fund’s portfolio will rise and fall. These fluctuations could be a sustained trend or a drastic movement. A Fund’s portfolio will reflect changes in prices of individual portfolio stocks or general changes in stock valuations. Consequently, a Fund’s share price may decline.

The Advisor or Sub-Advisor attempts to manage market risk by limiting the amount a Fund invests in each company’s equity securities. However, diversification will not protect a Fund against widespread or prolonged declines in the stock market.

Risks Related to Investing for Growth

Due to their relatively high valuations, growth stocks are typically more volatile than value stocks. For instance, the price of a growth stock may experience a larger decline on a forecast of lower earnings, a negative fundamental development, or an adverse market development. Further, growth stocks may not pay dividends or may pay lower dividends than value stocks. This means they depend more on price changes for returns and may be more adversely affected in a down market compared to value stocks that pay higher dividends.

Risks Related to Investing for Value

Due to their relatively low valuations, value stocks are typically less volatile than growth stocks. For instance, the price of a value stock may experience a smaller increase on a forecast of higher earnings, a positive fundamental development, or positive market development. Furthermore, value stocks tend to have higher dividends than growth stocks. This means they depend less on price changes for returns and may lag behind growth stocks in an up market.

Risks Related to Company Size

Generally, the smaller the market capitalization of a company, the fewer the number of shares traded daily, the less liquid its stock and the more volatile its price. For example, medium capitalization stocks may be less liquid and more volatile than stocks of larger, well-known companies. Market capitalization is determined by multiplying the number of its outstanding shares by the current market price per share.

Companies with smaller market capitalizations also tend to have unproven track records, a limited product or service base and limited access to capital. These factors also increase risks and make these companies more likely to fail than companies with larger market capitalizations.

Interest Rate Risks

Prices of fixed income securities rise and fall in response to changes in the interest rate paid by similar securities. Generally, when interest rates rise, prices of fixed income securities fall. However, market factors, such as the demand for particular fixed income securities, may cause the price of certain fixed income securities to fall while the prices of other securities rise or remain unchanged.

Interest rate changes have a greater effect on the price of fixed income securities with longer durations. Duration measures the price sensitivity of a fixed income security to changes in interest rates.

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Leverage Risks

Leverage risk is created when an investment exposes the Fund to a level of risk that exceeds the amount invested. Changes in the value of such an investment magnify the Fund’s risk of loss and potential for gain.

Close Out Risks

In a short sale transaction, close out risk is created by the ability of the broker to request at any time that the Fund close out its short position in the security. The broker’s call request would force the Fund to purchase the security at its current market price, and thus could result in a loss to the Fund.

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Credit Risks

Credit risk is the possibility that an issuer will default on a security by failing to pay interest or principal when due. If an issuer defaults, a Fund will lose money.

Many fixed income securities receive credit ratings from services such as Standard & Poor’s and Moody’s. These services assign ratings to securities by assessing the likelihood of issuer default. Lower credit ratings correspond to higher credit risk. If a security has not received a rating, a Fund must rely entirely upon the Advisor’s credit assessment.

Fixed income securities generally compensate for greater credit risk by paying interest at a higher rate. The difference between the yield of a security and the yield of a U.S. Treasury security with a comparable maturity (the spread) measures the additional interest paid for risk. Spreads may increase generally in response to adverse economic or market conditions. A security’s spread may also increase if the security’s rating is lowered, or the security is perceived to have an increased credit risk. An increase in the spread will cause the price of the security to decline.

Credit risk includes the possibility that a party to a transaction involving a Fund will fail to meet its obligations. This could cause a Fund to lose the benefit of the transaction or prevent a Fund from selling or buying other securities to implement its investment strategy.

Call Risks

Call risk is the possibility that an issuer may redeem a fixed income security before maturity (a call) at a price below its current market price. An increase in the likelihood of a call may reduce the security’s price.

If a fixed income security is called, a Fund may have to reinvest the proceeds in other fixed income securities with lower interest rates, higher credit risks, or other less favorable characteristics.

Prepayment Risks

Generally, homeowners have the option to prepay their mortgages at any time without penalty. Homeowners frequently refinance high interest rate mortgages when mortgage rates fall. This results in the prepayment of mortgage-backed securities with higher interest rates. Conversely, prepayments due to refinancings decrease when mortgage rates increase. This extends the life of mortgage-backed securities with lower interest rates. Other economic factors can also lead to increases or decreases in prepayments. Increases in prepayments of high interest rate mortgage-backed securities, or decreases in prepayments of lower interest rate mortgage-backed securities, may reduce their yield and price. These factors, particularly the relationship between interest rates and mortgage prepayments makes the price of mortgage-backed securities more volatile than many other types of fixed income securities with comparable credit risks.

Mortgage-backed securities generally compensate for greater prepayment risk by paying a higher yield. The difference between the yield of a mortgage-backed security and the yield of a U.S. Treasury security with a comparable maturity (the spread) measures the additional interest paid for risk. Spreads may increase generally in response to adverse economic or market conditions. A security’s spread may also increase if the security is perceived to have an increased prepayment risk or perceived to have less market demand. An increase in the spread will cause the price of the security to decline.

A Fund may have to reinvest the proceeds of mortgage prepayments in other fixed income securities with lower interest rates, higher prepayment risks, or other less favorable characteristics.

Risks of Foreign Investing

Foreign securities pose additional risks because foreign economic or political conditions may be less favorable than those of the United States. Securities in foreign markets may also be subject to taxation policies that reduce returns for U.S. investors.

Foreign companies may not provide information (including financial statements) as frequently or to as great an extent as companies in the United States. Foreign companies may also receive less coverage than United States companies by market analysts and the financial press. In addition, foreign countries may lack uniform accounting, auditing and financial reporting standards or regulatory requirements comparable to those applicable to U.S. companies. These factors may prevent a Fund and its Advisor and Sub-advisor from obtaining information concerning foreign companies that is as frequent, extensive and reliable as the information available concerning companies in the United States.

Foreign countries may have restrictions on foreign ownership of securities or may impose exchange controls, capital flow restrictions or repatriation restrictions which could adversely affect the liquidity of a Fund’s investments.

Risks Associated with Non-Investment Grade Securities

The securities in which a Fund may invest may be rated below investment grade. Securities rated below investment grade may be subject to the same risks as those inherent in corporate debt obligations that are rated below investment grade, also known as junk bonds. Junk bonds generally entail greater market, credit and liquidity risks than investment grade securities. For example, their prices are more volatile, economic downturns and financial setbacks may affect their prices more negatively, and their trading market may be more limited.

Affiliated Persons Risk

The Conservative Growth Fund II, Moderate Growth Fund II and Aggressive Growth Fund II are subject to affiliated persons risk. In managing each Managed Allocation Fund, the Advisor has the authority to select and substitute the Underlying Funds in which the Managed Allocation Fund will invest. The Advisor is subject to conflicts of interest in allocating Managed Allocation Fund assets among the various Underlying Funds both because the fees payable to it and/or its affiliates by some Underlying Funds are higher than the fees payable by other Underlying Funds and because the Advisor is also primarily responsible for managing the Underlying Funds. The Trustees and officers of the Managed Allocation Funds may also have conflicting interests in fulfilling their fiduciary duties to both the Managed Allocation Funds and the Underlying Funds.

Expenses of Investing in Other Funds

Mutual fund portfolios bear expenses for advisory fees and operational expenses. The Conservative Growth Fund II, Moderate Growth Fund II and Aggressive Growth Fund II and the Underlying Funds in which they will invest will each bear these expenses, so investors in the Conservative Growth Fund II, Moderate Growth Fund II or Aggressive Growth Fund II may bear higher expenses than a fund that invests directly in equity, fixed income or money market securities.

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Pursuant to an SEC exemptive order and exemptive rules, the Funds and each Underlying Fund is permitted to invest in shares of the Underlying Money Market Funds as a means of managing uninvested cash. These investments will cause a duplication of expenses. The Advisor may waive certain fees in connection with these investments.

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Exchange-Traded Funds

An investment in an ETF generally presents the same primary risks as an investment in a conventional fund (i.e., one that is not exchange traded) that has the same investment objectives, strategies, and policies. The price of an ETF can fluctuate up or down, and the Funds could lose money investing in an ETF if the prices of the securities owned by the ETF go down. In addition, ETFs that are exchange-traded may be subject to the following risks that do not apply to conventional funds: (i) the market price of an ETF’s shares may trade above or below their net asset value; (ii) an active trading market for an ETF’s shares may not develop or be maintained; or (iii) trading of an ETF’s shares may be halted if the listing exchange’s official deem such action appropriate, the shares are delisted from the exchange, or the activation of market-wide “circuit breakers” (which are tied to large decreases in stock prices) halts stock trading generally.

Mixed Funding and Shared Funding

As noted previously, the Funds were established exclusively for the purpose of providing an investment vehicle for variable annuity contracts and variable life insurance policies offered by separate accounts of participating insurance companies. The Trust is permitted to engage in “mixed funding” (using shares as investments for both variable annuity contracts and variable life insurance policies) and “shared funding” (using shares as investments for separate accounts of unaffiliated life insurance companies) pursuant to an exemption from the SEC, and currently is engaged in shared funding arrangements and must comply with conditions of the SEC exemption that are designed to protect investors in the Funds. Although the Funds do not currently see any disadvantage to contract owners due to differences in redemption rates, tax treatment or other considerations resulting from mixed funding or shared funding, the SEC only requires the Trustees to monitor the operation of mixed funding and shared funding arrangements, and to consider appropriate action to avoid material conflicts, and to take appropriate action in response to any material conflicts which occur. Such action could result in one or more participating insurance companies withdrawing their investment in a Fund.

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The Funds are authorized to pay financial institutions (primarily life insurance companies), a fee at the maximum annual rate of 0.35% (composed of 0.25% distribution (12b-1) fee and a 0.10% shareholder services fee) of the average daily net assets of Shares for which a financial institution provides distribution-related, shareholder and/or recordkeeping services. In addition, MTBIA and its affiliates may pay out of their own reasonable resources and profits to these financial institutions an additional fee for providing these services.

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How are Shares Priced?

Shares may be purchased, redeemed, or exchanged by participating insurance companies any day the New York Stock Exchange (NYSE) is open for business. Purchases and redemptions by wire will not be available on days the Federal Reserve wire system is closed. When a transaction request is received in proper form (as described in this prospectus), it is processed at the next calculated net asset value (NAV). The Funds have authorized participating insurance companies to accept transaction requests on their behalf.

The value of Shares of Large Cap Growth Fund II and Large Cap Value Fund II is generally determined based upon the market value of portfolio securities and other assets of the Fund. The value of Shares of Conservative Growth Fund II, Moderate Growth Fund II and Aggressive Growth Fund II is based upon the share prices of the Underlying Funds in which such Managed Allocation Funds invest; and the prices of those shares are determined by the market value of the portfolio securities held by the Underlying Funds. Investments in other open-end registered investment companies are valued at net asset value. In all cases, the Funds’ Board may determine in good faith that another method of valuing investments is necessary to appraise their fair market value. From time to time a Fund may purchase foreign securities that trade in foreign markets on days the NYSE is closed. If a Fund directly or indirectly owns foreign securities that trade in foreign markets on the days the NYSE is closed, the value of a Fund’s assets may change on days you cannot purchase or redeem Shares.

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NAV for the Funds is determined at the end of regular trading on the NYSE (normally 4:00 p.m. Eastern Time) (“NYSE Close”) each day the NYSE is open. The Funds generally value equity securities according to the last sale price in the market in which they are primarily traded (either a national securities exchange or the over-the-counter market). The Funds generally value fixed income securities according to the mean between bid and asked prices as furnished by an independent pricing service, except that fixed income securities with remaining maturities of less than 60 days at the time of purchase may be valued at amortized cost.

Trading in foreign securities may be completed at times which vary from the NYSE Close. In computing their NAV, the Funds value foreign securities at the latest closing price on the exchange on which they are traded immediately prior to the NYSE Close. Certain foreign currency exchange rates may also be determined at the latest rate prior to the NYSE Close. Foreign securities quoted in foreign currencies are translated into U.S. dollars at the foreign exchange rate in effect at 4:00 p.m., Eastern time, on the day the value of the foreign security is determined. Occasionally, events that affect these values and exchange rates may occur between the times at which they are determined and the NYSE Close. If such events materially affect the value of portfolio securities, these securities may be valued at their fair value determined in good faith by the Fund’s Board, although the actual calculation may be done for others. If a Fund owns foreign securities that trade in foreign markets on days the NYSE is closed, or if the NYSE closes earlier than 4:00 p.m. Eastern time, the value of these securities, and therefore the Fund’s assets, may change on days or at times you cannot purchase, redeem or exchange Shares of such Funds. In all cases the Fund’s Board may determine in good faith that another method of valuing investments is necessary to appraise their fair market value.

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The Funds may use the fair value of a security to calculate its NAV when, for example, (1) a portfolio security is not traded in a public market or the principal market in which the security trades is closed, (2) trading in a portfolio security is suspended and not resumed prior to the normal market close, (3) a portfolio security is not traded in significant volume for a substantial period, or (4) the Funds’ Advisor determines that the quotation or price for a portfolio security provided by a dealer or independent pricing service is inaccurate.

Fair valuation procedures are also used when a significant event affecting the value of a portfolio security is determined to have occurred between the time when the price of the portfolio security is determined and the close of trading on the NYSE, which is when the Funds’ NAV is computed. An event is considered significant if there is both an affirmative expectation that the security’s value will change in response to the event and a reasonable basis for quantifying the resulting change in value. Significant events include significant general securities market movements occurring between the time when the price of the portfolio security is determined and the close of trading on the NYSE. For domestic fixed income securities, such events may occur where the cut-off time for the market information used by the independent pricing service is earlier than the end of regular trading on the NYSE. For securities normally priced at their last sale price in a foreign market, such events can occur between the close of trading in the foreign market and the close of trading on the NYSE. In such cases, use of fair valuation can reduce an investor’s ability to seek to profit by estimating the Funds’ NAV in advance of the time when the NAV is calculated.

In some cases, events affecting the issuer of a portfolio security may be considered significant events. Examples of potentially significant events include announcements concerning earnings, acquisitions, new products, management changes, litigation developments, a strike or natural disaster affecting the company’s operations or regulatory changes or market developments affecting the issuer’s industry occurring between the time when the price of the portfolio security is determined and the close of trading on the NYSE. For securities of foreign issuers, such events could also include political or other developments affecting the economy or markets in which the issuer conducts its operations or its securities are traded.

The Funds’ Board has authorized the use of an independent fair valuation service to monitor changes in a designated U.S. market index after foreign markets close, and to implement a fair valuation methodology to adjust the closing prices of foreign securities if the movement in the index is significant.

There can be no assurance that a Fund could purchase or sell a portfolio security at the price used to calculate the Funds’ NAV. In the case of fair valued portfolio securities, lack of information and uncertainty as to the significance of information may lead to a conclusion that a prior valuation is the best indication of a portfolio security’s present value.

Fair valuations generally remain unchanged until new information becomes available. Consequently, changes in the fair valuation of portfolio securities may be less frequent and of greater magnitude than changes in the price of portfolio securities valued at their last sale price, by an independent pricing service, or based on market quotations. Fair valuation determinations often involve the consideration of a number of subjective factors, and the fair value price may be higher or lower than a readily available market quotation.

To the extent any fund invests in other investment companies, the prospectuses for those companies explain the circumstances under which they will use fair value pricing and the effects of using fair value pricing.

How are the Funds Sold?

Shares are sold at their NAV next determined after an order is received. Shares are not subject to any sales charges.

The Funds’ distributor, Edgewood Services, Inc. (Distributor), markets the Shares described in this prospectus to your insurance company as a funding vehicle for variable annuity contracts issued by your insurance company. When the Distributor receives marketing fees, it may pay some or all of them to investment professionals (including the Advisor and its affiliates) for sales, distribution, recordkeeping and/or administrative services. The Distributor and its affiliates may pay out of their assets other amounts (including items of material value) to investment professionals (including the Advisor and its affiliates) for marketing and servicing Shares. The Distributor is a subsidiary of Federated Investors, Inc. (Federated).

The Distributor may, from time to time in its sole discretion, institute one or more promotional incentive programs for dealers, which will be paid for by the Distributor from any sales charge it receives or from any other source available to it, including amounts made available by the Distributor’s affiliate, Federated Services Company, and the Advisor and its affiliates out of their reasonable profits and other resources. Under any such program, the Distributor may provide cash or non-cash compensation as recognition for past sales or encouragement for future sales that may include the following: merchandise, travel expenses, prizes, meals, and lodgings, and gifts that do not exceed $100 per year, per individual.

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Shareholder Services Plan

The Trust has adopted a Shareholder Services Plan on behalf of the Funds’ Shares, which is administered by Federated Services Company which allows the Funds to pay service fees at an annual rate of up to 0.10% of the average NAV of the Funds to financial intermediaries (which may include the Distributor, the Advisor or their affiliates) for acting as shareholder servicing agent for the Funds, including providing shareholder assistance, communicating or facilitating purchases and redemptions of Shares, and disseminating prospectuses and other information. This fee is paid primarily to the life insurance companies whose separate accounts invest in the Funds.

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Rule 12b-1 Plans

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The Trust has adopted a Rule 12b-1 Plan on behalf of the Funds, which allows them to pay fees to financial intermediaries (which may be paid through the Distributor) at an annual rate of up to 0.25% of the average daily NAV of the Funds for the sale, distribution, administration, customer servicing and recordkeeping of these Shares. These fees may be paid to the Distributor, the Advisor and their affiliates. The Funds may waive or reduce the maximum amount of Rule 12b-1 fees it pays from time to time in its sole discretion. In addition, a financial intermediary (including the Distributor, the Advisor or their affiliates) may voluntarily waive or reduce any fees to which they may be entitled. Because these shares pay marketing fees on an ongoing basis, your investment cost may be higher over time than other shares with different sales charges and marketing fees. This fee is paid primarily to the life insurance companies whose separate accounts invest in the Funds.

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Additional Payments to Financial Intermediaries

The Distributor and its affiliates (including Federated Services Company), may pay out of their own reasonable resources and profits amounts (including items of material value) to certain financial intermediaries (which may include the Advisor and its affiliates) to support the sale of Shares or provide services to Fund shareholders. The Advisor and its affiliates may pay out of their own reasonable resources and profits amounts (including items of material value) to certain financial intermediaries (including the Distributor and Federated Services Company) to support the sale of Shares or provide services to the Funds’ shareholders. The amounts of these payments could be significant, and may create an incentive for the financial intermediaries or its employees or associated persons to recommend or sell Shares of a Fund to you. These payments are not reflected in the fees and expenses listed in the fee table section of the Funds’ prospectus because they are not paid by the Funds.

These payments are negotiated and may be based on such factors as the number or value of Shares that the financial intermediary sells or may sell; the value of client assets invested; or the type and nature of services or support furnished by the financial intermediary. These payments may be in addition to payments made by a Fund to the financial intermediary under a Rule 12b-1 Plan and/or shareholder service fees arrangement. You can ask your financial intermediary for information about any payments it receives from the Distributor, the Advisor, their affiliates, or a Fund and any services the financial intermediary provides. The SAI contains additional information on the types of additional payments that may be paid.

How to Purchase, Redeem and Exchange Shares

Currently shares are used solely as the investment vehicle for separate accounts of your insurance company offering variable annuity contracts. Thus the general public has access to the Funds only by purchasing a variable annuity contract (thus becoming a contract owner). Shares are not sold directly to the general public. Please consult the accompanying separate account prospectus for information about the terms of an investment in a contract.

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Purchase and redemption orders are placed by your insurance company when your funds are credited to that insurance company’s accounts. In order to purchase or redeem shares of a Fund on a particular day, the Trust or its designated agent must receive the request before the NYSE Close. Purchase or redemption orders received by your insurance company by the NYSE Close will be processed at the NAV calculated on that day. If a purchase or redemption order is received by your insurance company after the NYSE Close, that transaction will receive the NAV computed on the next business day.

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Your insurance company is responsible for properly transmitting purchase and redemption orders and federal funds to the Funds.

Limitations on Redemption Proceeds

Redemption proceeds for Shares redeemed by an insurance company are normally paid within one business day after receiving a request in proper form. However, payment may be delayed up to seven days:

to allow a purchase payment to clear;
during periods of market volatility; or
when a redemption adversely impacts a Fund’s ability to manage its assets.

Redemption in Kind

Although the Funds intend to pay Share redemptions in cash, each Fund reserves the right to pay the redemption price in whole or in part by a distribution of the Funds’ portfolio securities.

Exchange Privilege

You may instruct your insurance company to exchange Shares of a Fund into shares of another fund of the Trust described in this prospectus and offered by your insurance company at NAV.

The Funds may modify or terminate the exchange privilege at any time, and shareholders will be notified prior to any modification or termination.

Frequent Trading Policies

Frequent or short-term trading into and out of a Fund can have adverse consequences for the Fund and shareholders who use the Funds as a long-term investment vehicle. Such trading in significant amounts can disrupt a Fund’s investment strategies (e.g., by requiring it to sell investments at inopportune times or maintain excessive short-term or cash positions to support redemptions) and increase brokerage and administrative costs. Investors engaged in such trading may also seek to profit by anticipating changes in the Fund’s NAV in advance of the time as of which NAV is calculated. Investors engaged in such trading may also seek to profit by anticipating changes in the Fund’s NAV in advance of the time as of which NAV is calculated or through an overall strategy to buy and sell Shares in response to incremental changes in the Fund’s NAV. This may be particularly likely where a Fund, directly or through an Underlying Fund, invests in high-yield securities or securities priced in foreign markets.

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The Funds’ Board has approved policies and procedures (“Policy”) intended to discourage excessive frequent or short-term trading of the Funds’ Shares. The Funds’ fair valuation procedures are intended in part to discourage short-term trading by reducing the potential for these strategies to succeed. See “How are Shares Priced?” Because the Funds’ Shares are held exclusively by insurance company separate accounts, rather than directly by the individual contract owners of the separate accounts, the Funds are not in a position to determine directly whether a separate account’s purchase or sale of Fund Shares on any given day represents transactions by a single or multiple investors (“Investors”). It is also not able to determine directly whether multiple purchases and sales by a separate account over any given period represent the activity of the same or of different Investors. Therefore, the Funds rely on procedures implemented by the insurance companies to discourage abusive trading practices. The Funds periodically request each insurer to certify that it has adopted policies and procedures that are reasonably calculated to detect and prevent excessive trading and to promptly notify MTB Fund personnel of any occurrences of excessive trading and possible market timing. In addition, in order to assist the Funds in implementing the Policy, each insurer must agree to provide, at the Funds’ request, certain information regarding Investors’ trading in Fund Shares, and to execute written instructions from the Funds to restrict or prohibit further purchases or exchanges of Fund Shares by any Investor whom the Funds have identified as having violated the Policy.

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Please refer to the prospectus for your variable insurance product contract to determine what policies or procedures may have been adopted by your insurance company to discourage frequent or short-term trading of the Fund and the other variable investment options offered under your contract. Whatever policies and procedures may have been adopted by your insurance company to discourage frequent or short-term trading, please note that the Funds are also used as an investment option for variable product contracts of other insurance companies. These other insurance companies may have different policies and procedures than those described in your variable insurance product prospectus.

To the extent that the policies and procedures of the Funds and/or participating insurance companies are not effective in discouraging frequent trading of their Shares, such trading may have the adverse consequences discussed above for the Funds and their long-term Shareholders. No matter how the Funds or a participating insurance company defines its limits on frequent trading of Shares, other purchases and sales of Shares may have adverse effects on the management of a Fund’s portfolio and its performance.

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The Funds’ Board receives a quarterly report of all potential occurrences of market timing which were detected during the preceding quarter, and a description of any action taken with respect thereto.

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Account and Share Information

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Dividends and Capital Gains

The Funds declare and pay any dividends as follows:

		DIVIDENDS DECLARED/
FUND		DIVIDENDS PAID


Managed Allocation Fund – Moderate II,
Managed Allocation Fund – Aggressive Growth II
and Large Cap Growth Fund II		Annually/Annually


Managed Allocation Fund – Conservative Growth II
and Large Cap Value II		Quarterly/Quarterly

Shares of the Funds will begin earning dividends if owned on the record date.

In addition, each Fund intends to pay any capital gains at least annually. All dividends and distributions will be automatically reinvested in additional shares of the respective Fund unless an election is made by the participating insurance company to receive some or all of the dividend or distribution in cash.

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Tax Information

The Funds will seek to comply with asset diversification regulations applicable to registered investment companies under the Investment Company Act of 1940 and the Internal Revenue Code. The variable insurance contracts that invest in a Fund will be affected by the Fund’s compliance with applicable diversification tests. If a Fund fails to comply with these regulations, contracts invested in a Fund may not be treated as an annuity, endowment or life insurance contract under the Internal Revenue Code. In such event, income with respect to contracts invested in a Fund at any time during the calendar quarter in which the failure occurred could become currently taxable to the owners of the contracts. Similarly, income for prior periods with respect to such contracts also could be taxable, most likely in the year of the failure to achieve the desired diversification. Other adverse tax consequences could also ensue. For more information concerning the consequences of the Funds failing to meet the asset diversification regulations, consult your separate account prospectus.

Contract owners should review the applicable contract prospectus for information concerning the federal income tax treatment of their contracts and distributions from the Fund to the separate accounts.

Contract owners are urged to consult their own tax advisors regarding the status of their contracts under state and local tax laws.

Portfolio Holdings Information

Each Fund’s annual and semiannual reports contain complete listings of the Fund’s portfolio holdings as of the end of the Fund’s second and fourth fiscal quarters. Each Fund prepares a report on Form N-Q of its portfolio holdings as of the end of the Fund’s first and third fiscal quarters. Each of these financial statements is filed with the SEC within 60 days of the end of the reporting period at the SEC’s website at www.sec.gov and is posted on the Funds’ website at www.mtbvafunds.com.

Each quarter, the Funds provide the top 10 holdings to the insurance companies that offer the Funds in their insurance contracts. This information is provided to these entities under an agreement of confidentiality, before such information is made publicly available, so that these entities may produce fact sheets about the Funds as of the end of such quarter, which may include an analysis of the Funds’ holdings by sector, credit quality and/or country, as applicable. These fact sheets are not disseminated by the insurance companies until after this information is posted on the Funds’ website. Fund portfolio holdings information is posted on the Funds’ website within two weeks of the quarter-end at www.mtbvafunds.com.

Who Manages the Funds?

The Board of Trustees governs the Funds. The Board selects and oversees the Advisor, MTB Investment Advisors, Inc. (MTBIA or Advisor), a subsidiary of Manufacturers and Traders Trust Company (M&T Bank). The Advisor manages the Funds’ assets, including buying and selling portfolio securities. The Advisor’s address is 100 East Pratt Street, 17th Floor, Baltimore, MD 21202.

On August 22, 2003, the investment advisory operations of M&T Asset Management, a department of M&T Bank, were transferred to Allied Investment Advisors, Inc. (which was renamed MTB Investment Advisors, Inc.) and effective on that date MTB Investment Advisors, Inc. became the investment advisor to the Trust.

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M&T Bank is the principal banking subsidiary of M&T Bank Corporation, a regional bank holding company in existence since 1969. M&T Bank was founded in 1892 and provides comprehensive banking and financial services to individuals, governmental entities and businesses throughout New York State, Pennsylvania, Maryland and parts of Virginia, West Virginia, the District of Columbia and Delaware. As of December 31, 2006, M&T Bank had over $142.4 billion in assets under management. MTBIA and entities affiliated with MTBIA or its predecessors have served as investment advisor to MTB Funds since 1988, and, as of December 31, 2006, it managed approximately $13.6 billion in assets. As part of its regular banking operations, M&T Bank may make loans to public companies. Thus, it may be possible, from time to time, for the Funds to hold or acquire the securities of issuers which are also lending clients of M&T Bank. The lending relationship will not be a factor in the selection of securities.

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For its services under an Advisory Contract, the Advisor is entitled to receive an annual Advisory Fee from each Fund, equal to a percentage of each Fund’s average daily net assets as follows:

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FUND NAME		ADVISORY FEE

Large Cap Growth Fund II		0.85%

Large Cap Value Fund II		0.70%

Conservative Growth II		0.25%

Moderate Growth Fund II		0.25%

Aggressive Growth II		0.25%

For the fiscal year 2007 reporting period through April 30, 2008, the Advisor agreed to contractually waive all or a portion of its investment advisory fee (based on average daily net assets) and/or to reimburse certain operating expenses of the Funds in order to limit each Fund’s total direct operating expenses to not more than the stated amount shown below of the Fund’s average daily net assets.

FUND NAME		ANNUAL RATE

Large Cap Growth Fund II		1.00%

Large Cap Value Fund II		1.00%

Conservative Growth II		0.74%

Moderate Growth II		0.74%

Aggressive Growth II		0.74%

In addition, the Advisor may voluntarily waive a portion of its fee or reimburse the Funds for certain operating expenses.

In addition to the investment management services provided by MTBIA, MTBIA’s affiliate M&T Securities, Inc. provides administrative services to the Funds and is entitled to receive a maximum fee of .04% of the Funds’ average daily net assets for such administrative services.

A discussion of the Board’s review of the Funds’ Investment Advisory contracts is available in the Fund’s Annual Shareholder report dated December 31, 2006.

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Sub-Advisor

Pursuant to an exemptive order from the Securities and Exchange Commission, the Advisor (subject to the approval of the Board of Trustees) may select and replace subadvisors and amend subadvisory agreements between the Advisor and the subadvisors without obtaining shareholder approval. Accordingly, the Advisor may (subject to Board approval) appoint and replace subadvisors and amend subadvisory agreements without obtaining shareholder approval. The foregoing applies to Large Cap Growth Fund II and Large Cap Value Fund II.

The Advisor has entered into a Sub-Advisory Agreement with the following sub-advisor to manage Large Cap Value Fund II, subject to supervision of the Advisor and the Board, and in accordance with the investment objective and restrictions of Large Cap Value Fund II. For its services, the sub-advisor receives a fee based upon a percentage of the Large Cap Value Fund II’s average daily net assets, which is paid by the Advisor and not by Large Cap Value Fund II.

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NWQ Investment Management Company LLC (NWQ) sub-advises Large Cap Value Fund II. NWQ is a registered investment advisor that was founded in 1982 and most recently reorganized in August 2002 as a Delaware limited liability company. NWQ is a 97%-owned subsidiary of Nuveen Investments, Inc. (Nuveen), which is a publicly held company. NWQ’s principal business address is 2049 Century Park East, 16th Floor, Los Angeles, California 90067. As of December 31, 2006, NWQ managed $35.6 billion in assets under management in two separate divisions–the Institutional Division and the Separately Managed Accounts Division. NWQ has had past experience managing mutual funds. NWQ manages Large Cap Value Fund II, makes decisions with respect to and places orders for all purchases and sales of its portfolio securities, and maintains the records relating to such purchases and sales.

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NWQ LARGE CAP VALUE COMPOSITE PERFORMANCE INFORMATION

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The following table presents the past performance of a composite of certain accounts managed by NWQ which serves as the subadviser and to the MTB Large Cap Value Fund II. The NWQ Large Cap Value II composite is composed of all fee paying accounts under discretionary management by NWQ that have large cap value investment objectives, policies and strategies substantially similar to those of the MTB Large Cap Value Fund. NWQ has prepared the gross performance data for the composite shown in the table in compliance with the Global Investment Performance Standards (GIPS^®). GIPS^®has not been involved in the preparation or review of this report. The gross performance data was calculated on an asset-weighted, total return basis, including reinvestment of all dividends, interest and income, realized and unrealized gains or losses, brokerage commissions and execution costs and custodial fees, without provision for federal and state income taxes, if any. The GIPS^®method for computing historical performance differs from the Securities and Exchange Commission’s method. Because the gross performance data shown in the table does not reflect the deduction of investment advisory fees paid by the accounts comprising the composite and certain other expenses which would be applicable to mutual funds, the net performance data may be more relevant to potential investors in the MTB Large Cap Value Fund II in their analysis of the historical experience of NWQ in managing all large cap value portfolios with investment objectives, policies and strategies substantially similar to those of the MTB Large Cap Value Fund II. To calculate the performance of the composite net of all operating expenses, the annual fund operating expenses payable by the Shares of MTB Large Cap Value Fund II for the fiscal year ended December 31, 2006 were used. However, the performance numbers do not reflect any charges or expenses that would be imposed under a variable insurance product contract. Were the effects of such charges to be included, share performance would be lower.

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The historical performance of the NWQ Large Cap Value composite is not that of any of the MTB Funds, including MTB Large Cap Value Fund II, and is not necessarily indicative of any Fund’s future results. MTB Large Cap Value Fund II commenced operations on May 31, 2002, and NWQ commenced managing the Large Cap Value Fund II on December 8, 2004. The actual performance of the MTB Large Cap Value Fund II (which is presented in this prospectus) may vary significantly from the past performance of the composite. While the accounts comprising the composite incur inflows and outflows of cash from clients, there can be no assurance that the continuous offering of a fund’s shares and a fund’s obligation to redeem its shares will not adversely impact the fund’s performance. Also, the accounts comprising the composite are not subject to certain investment limitations, diversification requirements and other restrictions imposed by the Investment Company Act of 1940 and the Internal Revenue Code. If these limitations, requirements and restrictions were applicable to the composite, they may have had an adverse effect on the performance results of the composite. The aggregate returns of the accounts comprising the composite may not reflect the returns of any particular account managed by NWQ.

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NWQ LARGE CAP VALUE COMPOSITE PERFORMANCE
Average Annual Total Return for the Periods Ended December 31, 2006:
Large Cap Value Composite*			1 Year		3 Years		5 Years		10 Years

Composite net of all operating expenses			16.74%		14.85%		11.18%		11.52%

Composite gross of all operating expenses			19.09%		17.17%		13.43%		13.78%

Standard & Poor’s 500/Citigroup Value Index			18.02%		11.46%		6.72%		7.07%

Calendar Year Total Return for the Years Ended December 31:
	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006

Composite net of all operating expenses	32.55%	6.65%	14.63%	8.50%	(0.86)%	(15.49)%	32.40%	18.12%	9.65%	16.74%

Composite gross of all operating expenses	35.32%	8.93%	17.06%	10.81%	1.26%	(13.65)%	35.17%	20.61%	11.98%	19.09%

Standard & Poor’s 500/Citigroup Value Index	28.79%	13.83%	12.38%	6.05%	(11.68)%	(20.85)%	(31.79)%	15.69%	5.85%	18.02%

Because the adviser contractually agreed to limit the Large Cap Value Fund II Shares total operating expenses to 1.00% the performance of the composite net of advisory fees and expenses after giving effect to the expense limitations would have been:

Average Annual Total Return for the Periods Ended December 31, 2006:
Large Cap Value Composite*			1 Year		3 Years		5 Years		10 Years

Composite net of all operating expenses			17.92%		16.01%		12.31%		12.65%

Calendar Year Total Return for the Years Ended December 31:
	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006

Composite net of all operating expenses	34.01%	7.85%	15.91%	9.71%	0.26%	(14.52)%	(33.86)%	19.43%	10.87%	17.92%

* This is not the performance of the Large Cap Value Fund II. The Large Cap Value composite includes all fee paying discretionary accounts managed by NWQ which have large cap value investment objectives, policies and strategies substantially similar to those of the Large Cap Value Fund II. As of December 31, 2006, the Large Cap Value composite was composed of 204 accounts totaling approximately $5.5 billion.

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Portfolio Managers
FUND		PORTFOLIO MANAGER(S)

Conservative Growth Fund II		Thomas R. Pierce, CFA
		Mark Stevenson, CFA

Moderate Growth Fund II		Thomas R. Pierce, CFA
		Mark Stevenson, CFA

Aggressive Growth Fund II		Thomas R. Pierce, CFA
		Mark Stevenson, CFA

Large Cap Value Fund II		Jon Bosse, CFA (NWQ)
		E. C. (Ted) Friedel, CFA (NWQ)

Large Cap Growth Fund II		Allen J. Ashcroft, Jr.
		Byron J. Grimes II, CFA

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Thomas R. Pierce, CFA, is an Administrative Vice President and has been with M&T Bank since January 1995. He has been a Vice President and Portfolio Manager of MTBIA since April 2003. Prior to joining M&T, Mr. Pierce was employed by Merit Investment Advisors where he acted as Director of Fixed Income Product and Trading since 1993. For the period from 1987 to 1993, Mr. Pierce served as Fixed Income Manager at ANB Investment Management Company, where he directed the management of $3.5 billion of active and passive fixed income portfolios. Mr. Pierce is a holder of the right to use the Chartered Financial Analyst designation (CFA Charterholder) and has a B.A. in Economics from Washington University, and an M.B.A from the University of Chicago.

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Mark Stevenson, CFA, is a Vice President of MTBIA. Prior to joining M&T in October 2000, Mr. Stevenson was with Keystone Financial, Inc. (“Keystone”) since 1990, where he managed retirement plan, personal trust and institutional assets for the clients of Keystone. He is a CFA Charterholder and graduated with a Bachelor of Arts in Prelaw from Pennsylvania State University. He also graduated with a Master of Arts in International Economics and U.S. Foreign Policy from The American University, Washington, D.C.

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Managed Allocation Funds – Mr. Stevenson and Mr. Pierce co-manage the Managed Allocation Funds. Under normal circumstances, Mr. Stevenson or Mr. Pierce initially recommends changes to the allocation among and the selection of Underlying Funds. Whomever of the two co-managers doesn’t initiate the allocation recommendation then contributes input and the analysis and the two portfolio managers jointly decide the investment approach to be implemented.

Allen J. Ashcroft, Jr. has been a Vice President and Portfolio Manager of MTBIA since 1996 and a Vice President of M&T Bank since April 2003. He was a Vice President of AllFirst Bank from 1995 until its acquisition by M&T Bank on April 1, 2003. Mr. Ashcroft has more than 27 years of experience in investment research and equity analysis. He earned his B.A. from the University of Pittsburgh.

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Byron J. Grimes II, CFA, has been the Managing Director of Equity Portfolio Management and a Senior Portfolio Manager of MTBIA since April 2004. Prior to joining MTBIA, Mr. Grimes served as the Chief Investment Officer of Citizens Investment Services Group, a division of Citizens Bank of Providence, Rhode Island. He has 31 years experience in investment research and portfolio management. Mr. Grimes holds a B.A. degree from Centre College in Danville, Kentucky. He is a CFA Charterholder.

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Large Cap Growth Fund II – Byron J. Grimes and Allen J. Ashcroft jointly manage the Large Cap Growth Fund II. They both agree on purchases and sales, and jointly decide on sector and capitalization weightings.

Jon D. Bosse, CFA, has been Portfolio Manager for MTB Large Cap Value Fund II since December 2004. He is a Portfolio Manager and the Chief Investment Officer for NWQ Investment Management Company LLC (NWQ). Prior to joining NWQ in 1996, Mr. Bosse spent ten years with ARCO Investment Management Company where, in addition to managing a value-oriented fund, he was the Director of Equity Research. Mr. Bosse received his B.A. in Economics from Washington University, St. Louis, where he was awarded the John M. Olin Award for excellence in economics, and graduated summa cum laude. He received his M.B.A. from the Wharton Business School, University of Pennsylvania. He is an active member of the Los Angeles Society of Financial Analysts. In addition, he is a CFA Charterholder and is a member of the CFA Institute.

E. C. (Ted) Friedel, CFA, has been a Co-Portfolio Manager of MTB Large Cap Value Fund II since December 2004. He is a Portfolio Manager and Managing Director for NWQ. Prior to joining NWQ in 1983, Mr. Friedel spent eleven years with Beneficial Standard Investment Management Company where he managed several large institutional portfolios. He was a senior member of the firm’s investment committee and was instrumental in the development of investment policy. E. C. (Ted) Friedel graduated from the University of California at Berkeley, B.S., and received his M.B.A. from Stanford University. He is an active member of the Los Angeles Society of Financial Analysts. In addition, he is a CFA Charterholder and is a member of the CFA Institute.

Large Cap Value Fund II – Jon D. Bosse has primary responsibility for driving the research process for the firm’s large cap portfolio strategy, and in conjunction with the firm’s investment professionals, developing a model portfolio for NWQ’s clients. E. C. (Ted) Friedel participates in that process and has primary responsibility for overseeing the strategy’s implementation and investment for Large Cap Value Fund II.

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The Funds’ SAI provides additional information about the Portfolio Managers’ compensation, management of other accounts, and ownership of securities in the Funds.

Financial Information

Financial Highlights

The following financial highlights are intended to help you understand the financial performance of each Fund’s Shares since inception. Some of the information is presented on a per share basis. Total returns represent the rate an investor would have earned (or lost) on an investment in a Fund, assuming reinvestment of all dividends and capital gains.

The following financial highlights do not reflect any charges or expenses that would be imposed under a variable insurance product contract. Were the effect of such charges to be included, your cost would be higher and share performance would be lower.

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This information has been audited by Ernst & Young LLP, an independent registered public accounting firm, whose report, along with the Funds’ audited financial statements, is included in the Funds’ December 31, 2006 Annual Report which is available upon request.

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MTB Group of Funds
Financial Highlights

(For a share outstanding throughout each period)
										Ratios to Average Net Assets

	Net Asset		Net Realized		Distributions	Distributions							Net Assets,
Year	Value,	Net	and Unrealized	Total from	from Net	from Net		Net Asset			Net	Expense	end	Portfolio
Ended	beginning	Investment	Gain (Loss) on	Investment	Investment	Realized Gain	Total	Value, end	Total	Net	Investment	Waiver/	of period	Turnover
December 31,	of period	Income	Investments	Operations	Income	on Investments	Distributions	of period	Return(a)	Expenses	Income	Reimbursement (b)	(000 omitted)	Rate


Large Cap Growth Fund II
2002(c)	$10.00	0.01	(1.66)	(1.65)	—	—	—	$8.35	(16.50)%	1.00%(d)	0.32%(d)	2.80%(d)	$1,304	35%
2003	$8.35	0.03	1.42	1.45	(0.02)	—	(0.02)	$9.78	17.35%	1.00%	0.37%	1.45%	$2,627	45%
2004	$9.78	0.05	0.45	0.50	(0.06)	—	(0.06)	$10.22	5.15%	1.00%	0.64%	1.89%	$4,333	111%
2005	$10.22	0.03	0.16	0.19	(0.04)	(0.29)	(0.33)	$10.08	2.02%	1.00%	0.30%	1.60%	$5,071	65%
2006	$10.08	0.06	0.99	1.05	(0.06)	(0.12)	(0.18)	$10.95	10.34%	1.00%	0.53%	1.49%	$5,337	50%


Large Cap Value Fund II
2002(c)	$10.00	0.04	(2.32)	(2.28)	(0.02)	—	(0.02)	$7.70	(22.79)%	1.00%(d)	0.98%(d)	2.98%(d)	$1,293	18%
2003	$7.70	0.09(e)	2.47	2.56	(0.08)	—	(0.08)	$10.18	33.45%	1.00%	1.01%	1.23%	$2,756	26%
2004	$10.18	0.11	0.86	0.97	(0.12)	—	(0.12)	$11.03	9.58%	1.00%	1.22%	1.61%	$4,829	126%
2005	$11.03	0.08	0.94	1.02	(0.09)	(0.93)	(1.02)	$11.03	10.29%	1.00%	0.80%	1.18%	$6,262	13%
2006	$11.03	0.12	1.79	1.91	(0.12)	(0.87)	(0.99)	$11.95	17.61%	1.00%	1.03%	1.02%	$8,456	20%


Managed Allocation Fund – Conservative Growth II
2005(f)	$10.00	0.23(e)	0.09	0.32	(0.12)	(0.04)	(0.16)	$10.16	3.24%	0.74%(d)	3.40%(d)	28.66%(d)	$452	35%
2006	$10.16	0.31	0.39	0.70	(0.31)	(0.16)	(0.47)	$10.39	6.96%	0.74%	3.19%	8.37%	$740	17%


Managed Allocation Fund – Moderate Growth II
2002(g)	$10.00	0.10(e)	(0.78)	(0.68)	(0.03)	—	(0.03)	$9.29	(6.79)%	0.74%(d)	2.03%(d)	1.03%(d)	$6,623	8%
2003	$9.29	0.11(e)	1.46	1.57	(0.09)	(0.11)	(0.20)	$10.66	17.29%	0.74%	1.08%	0.28%	$23,279	17%
2004	$10.66	0.12	0.50	0.62	(0.13)	(0.07)	(0.20)	$11.08	5.94%	0.74%	1.37%	0.06%	$41,011	109%
2005	$11.08	0.15	0.24	0.39	(0.16)	(0.91)	(1.07)	$10.40	4.00%	0.74%	1.51%	0.07%	$45,744	14%
2006	$10.40	0.27	0.81	1.08	(0.27)	(0.55)	(0.82)	$10.66	10.42%	0.74%	2.50%	0.09%	$48,285	21%


Managed Allocation Fund – Aggressive Growth II
2005(f)	$10.00	0.20(e)	0.62	0.82	(0.06)	—	(0.06)	$10.76	8.18%	0.74%(d)	2.89%(d)	34.13%(d)	$514	1%
2006	$10.76	0.34(e)	1.25	1.59	(0.27)	(0.32)	(0.59)	$11.76	14.83%	0.74%	3.02%	5.87%	$1,175	16%

(a) Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable.

Total returns do not reflect any additional fees or expenses that may be imposed by separate accounts of insurance companies or in connection with any variable annuity or variable life insurance contract.

(b) This expense decrease is reflected in both the net expense and net investment income ratios shown.

(d) Computed on an annualized basis.

(e) Per share information is based on average shares outstanding.

(f) Reflects operations for the period from May 3, 2005 (date of initial public investment) to December 31, 2005.

(g) Reflects operations for the period from June 17, 2002 (date of initial public investment) to December 31, 2002.

Further information about the Funds’ performance is contained in the Funds’ Annual Report, dated December 31, 2006, which can be obtained free of charge.

</R>

HOW TO OBTAIN MORE INFORMATION ABOUT MTB GROUP OF FUNDS

<R>

A Statement of Additional Information (SAI) dated April 30, 2007 is incorporated by reference into this prospectus. Additional information about the Funds’ investments is available in the SAI and in the Annual and Semi-Annual Reports to shareholders of the MTB Group of Funds as they become available. The Annual Report discusses market conditions and investment strategies that significantly affected the Funds’ performance during its last fiscal year. To obtain the SAI, the Annual and Semi-Annual Reports (when available) and other information without charge, and to make inquiries, call 1-800-836-2211.

</R>

These documents, as well as additional information about the Funds (including portfolio holdings, performance and distributions), are available on MTB’s website at www.mtbvafunds.com.

To Obtain More Information:

Phone: Call 1-800-836-2211

<R>

Web: www.mtbvafunds.com

</R>

SEC: You can also obtain the SAI or Annual and Semi-Annual Reports, as well as other information about MTB Group of Funds, from the SEC’s website (http://www.sec.gov). You may review and copy documents at the SEC Public Reference Room in Washington, D.C. (for information call (202) 942-8090). You may request documents by mail from the SEC, upon payment of a duplicating fee, by (1) writing to: Securities and Exchange Commission, Public Reference Section, Washington, D.C. 20549-0102 or (2) sending an electronic request to publicinfo@sec.gov.

Cusip 55376V820
Cusip 55376T734
Cusip 55376V812
Cusip 55376T650
Cusip 55376T577

Investment Advisor

MTB Investment Advisors, Inc.
100 E. Pratt Street
17th Floor
Baltimore, MD 21202

<R>

www.mtbia.com

</R>

Distributor

Edgewood Services, Inc.
5800 Corporate Drive
Pittsburgh, PA 15237-5829

Sub-Advisor to MTB Large Cap Value Fund II

NWQ Investment Management Company LLC
2049 Century Park East

<R>

16th Floor

</R>

Los Angeles, CA 90067

Co-Administrator

M&T Securities, Inc.
One M&T Plaza
Buffalo, NY 14203

Co-Administrator

Federated Services Company
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Transfer Agent and Dividend Disbursing Agent

Boston Financial Data Services, Inc.
2 Heritage Drive
North Quincy, MA 02171

Custodian and Fund Accountant

State Street Corporation
P.O. Box 8609
Boston, MA 02266-8609

Independent Registered Public Accounting Firm

Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116-5072

SEC File No. 811-5514

<R>

27273 (4/07)

MTB-AR-007-0407

</R>

MTB GROUP OF FUNDS

STATEMENT OF ADDITIONAL INFORMATION

<R>

APRIL 30, 2007

MTB LARGE CAP GROWTH FUND II

("LARGE CAP GROWTH FUND II")

MTB LARGE CAP VALUE FUND II

("LARGE CAP VALUE FUND II")

MTB MANAGED ALLOCATION FUND - CONSERVATIVE GROWTH II

("CONSERVATIVE GROWTH FUND II")

MTB MANAGED ALLOCATION FUND - MODERATE GROWTH II

("MODERATE GROWTH FUND II")

MTB MANAGED ALLOCATION FUND - AGGRESSIVE GROWTH II

("AGGRESSIVE GROWTH FUND II")

This Statement of Additional Information (SAI) is not a prospectus. Read this
SAI in conjunction with the prospectus for the Funds dated April 30, 2007.

Obtain the prospectus without charge by calling (800) 836-2211 (in the Buffalo
area call (716) 635-9368).

CONTENTS
HOW ARE THE FUNDS ORGANIZED? 3
SECURITIES IN WHICH THE FUNDS INVEST 3
INVESTMENT RISKS 13
FUNDAMENTAL INVESTMENT OBJECTIVES 17
INVESTMENT LIMITATIONS 17
DETERMINING MARKET VALUE OF SECURITIES 19
WHAT DO SHARES COST? 20
HOW ARE THE FUNDS SOLD? 20
SUBACCOUNTING SERVICES 21
REDEMPTION IN KIND 21
ACCOUNT AND SHARE INFORMATION 22
TAX INFORMATION 23
WHO MANAGES AND PROVIDES SERVICES TO THE FUNDS? 24
HOW DO THE FUNDS MEASURE PERFORMANCE? 38
FINANCIAL INFORMATION 40
INVESTMENT RATINGS 40
ADDRESSES BACK COVER PAGE

</R>

Cusip 55376V820
Cusip 55376T734
Cusip 55376V812
Cusip 55376T650
Cusip 55376T577
27285 (4/07)

HOW ARE THE FUNDS ORGANIZED?
Each Fund covered by this SAI is a diversified portfolio of MTB Group of Funds
(the "Trust"), a Delaware statutory trust. On August 11, 2000, the Trust was
organized to acquire all of the assets and liabilities of the VISION Group of
Funds, Inc., a Maryland corporation (the "Corporation") that was originally
incorporated under the laws of the State of Maryland on February 23, 1988, and
registered as an open-end management investment company. The name of the Trust
was changed to "MTB Group of Funds" on August 15, 2003. The Trust may offer
separate series of shares representing interests in separate portfolios of
securities.

Through an internal reorganization, the Funds' investment advisor changed from
M&amp;T Asset Management, a department of Manufacturers and Traders Trust
Company ("M&amp;T Bank"), to MTB Investment Advisors, Inc. (MTBIA or "Advisor"),
a subsidiary of M&amp;T Bank, on August 15, 2003. The sub-advisor for the Large
Cap Value Fund II is NWQ Investment Management Company, LLC.

SECURITIES IN WHICH THE FUNDS INVEST

In pursuing its investment strategy, each Fund may invest in the following types
of securities for any purpose that is consistent with the Funds' investment
goal. Following is a table that indicates which types of securities are a:

P = Principal investment of a Fund;
A = Acceptable (but not principal) investment of a Fund; or
N = Not an acceptable investment of a Fund.

As described in the prospectus, Conservative Growth Fund II, Moderate Growth
Fund II and Aggressive Growth Fund II seek to achieve their investment
objectives by investing in a combination of underlying funds (the "Underlying
Funds") managed by the Advisor. The types of securities shown for Conservative
Growth Fund II, Moderate Growth Fund II and Aggressive Growth Fund II in the
table represent the investments held by the Underlying Funds.

<R>

LARGE CAP GROWTH LARGE CONSERVATIVE GROWTH MODERATE GROWTH AGGRESSIVE GROWTH
FUND II CAP FUND II FUND II FUND II
VALUE
FUND
II

EQUITY SECURITIES P P P P P
Common Stocks P P P P P
Preferred Stocks P P P P P
Interests in Other Limited Liability Companies A A N N N
Real Estate Investment Trusts A A A A A
Warrants4 A A A A A
FIXED INCOME SECURITIES P P P P P
Treasury Securities A A P P P
Agency Securities A A P P P
Corporate Debt Securities1 A A P P P
Commercial Paper A A A A A
Demand Instruments A A A A A
Taxable Municipal Securities N N A A A
Mortgage Backed Securities A A P P P
Collateralized Mortgage Obligations N N P P P
(CMOs)
Asset Backed Securities2 A A P P P
Zero Coupon Securities A A P P P
Bank Instruments A P P P P
Credit Enhancement N N P P P
CONVERTIBLE SECURITIES5 P P A A A
Tax Exempt Securities3 N N P P P
Variable Rate Demand Instruments N N A A A
Municipal Securities N N P P P
Municipal Notes N N P P P
FOREIGN SECURITIES A P P P P
Depository Receipts P P P P P
Foreign Exchange Contracts N N P P P
Foreign Government Securities N N P P P
DERIVATIVE CONTRACTS A A A A A
Futures Contracts A A A A A
Options A A A A A
Credit Default Swaps A A A A A
SPECIAL TRANSACTIONS A A A A A
Repurchase Agreements A A A A A
Reverse Repurchase Agreements A A A A A
Delayed Delivery Transactions A A A A A
Securities Lending A A A A A
Asset Segregation A A A A A
INVESTING IN SECURITIES OF OTHER INVESTMENT P P P P P
COMPANIES
Exchange-Traded Funds A A A A A
Short Sales P N N N N
Non-Investment Grade Securities N N P P P

1. Rated in the top four rating categories of a nationally recognized
statistical rating organization (NRSRO), or, if unrated, of comparable
quality as determined by the Advisor or sub-advisor. If a security's rating
is lowered, the Advisor will assess whether to sell the security, but is
not required to do so.

2. Large Cap Value Fund II may invest in asset backed securities which, at the
time of purchase, are rated in the top three rating categories by an NRSRO,
and the Large Cap Growth Fund II may invest in such securities, which, at
the time of purchase, are rated in the top four rating categories by an
NRSRO, or if unrated, are of comparable quality as determined by the
Advisor or subadvisor. If a security's rating is lowered, the Advisor will
assess whether to sell the security, but is not required to do so.

3. Which are in one of the top four rating categories of an NRSRO.

4. The Funds do not have a present intent to invest more than 5% of their
respective net assets in warrants.

5. The Funds may invest in convertible securities rated below investment
grade. See "Risks Associated with Non-investment Grade Securities" herein.
</R>

SECURITIES DESCRIPTIONS AND TECHNIQUES
Following are descriptions of securities and techniques that each Fund may or
may not pursue, as noted in the preceding table.

EQUITY SECURITIES
Equity securities represent a share of an issuer's earnings and assets, after
the issuer pays its liabilities. A Fund cannot predict the income it will
receive from equity securities because issuers generally have discretion as to
the payment of any dividends or distributions. However, equity securities offer
greater potential for appreciation than many other types of securities, because
their value increases directly with the value of the issuer's business. The
following describes the types of equity securities in which a Fund invests.

COMMON STOCKS
Common stocks are the most prevalent type of equity security. Common stocks
receive the issuer's earnings after the issuer pays its creditors and any
preferred stockholders. As a result, changes in an issuer's earnings
directly influence the value of its common stock.

PREFERRED STOCKS
Preferred stocks have the right to receive specified dividends or
distributions before the issuer makes payments on its common stock. Some
preferred stocks also participate in dividends and distributions paid on
common stock. Preferred stocks may also permit the issuer to redeem the
stock. A Fund may also treat such redeemable preferred stock as a fixed
income security.

INTERESTS IN OTHER LIMITED LIABILITY COMPANIES
Entities such as limited partnerships, limited liability companies, business
trusts and companies organized outside the United States may issue securities
comparable to common or preferred stocks.

REAL ESTATE INVESTMENT TRUSTS (REITS)
REITs are real estate investment trusts that lease, operate and finance
commercial real estate. REITs are exempt from federal corporate income tax
if they limit their operations and distribute most of their income. Such tax
requirements limit a REIT's ability to respond to changes in the commercial
real estate market.

WARRANTS
Warrants give a Fund the option to buy the issuer's equity securities at a
specified price (the exercise price) at a specified future date (the
expiration date). A Fund may buy the designated securities by paying the
exercise price before the expiration date. Warrants may become worthless if
the price of the stock does not rise above the exercise price by the
expiration date. This increases the market risks of warrants as compared to
the underlying security. Rights are the same as warrants, except companies
typically issue rights to existing stockholders.

FIXED INCOME SECURITIES
Fixed income securities pay interest, dividends or distributions at a specified
rate. The rate may be a fixed percentage of the principal or adjusted
periodically. In addition, the issuer of a fixed income security must repay the
principal amount of the security, normally within a specified time. Fixed
income securities provide more regular income than equity securities. However,
the returns on fixed income securities are limited and normally do not increase
with the issuer's earnings. This limits the potential appreciation of fixed
income securities as compared to equity securities.

A security's yield measures the annual income earned on a security as a
percentage of its price. A security's yield will increase or decrease depending
upon whether it costs less (a discount) or more (a premium) than the principal
amount. If the issuer may redeem the security before its scheduled maturity,
the price and yield on a discount or premium security may change based upon the
probability of an early redemption. Securities with higher risks generally have
higher yields.

The following describes the types of fixed income securities in which a Fund may
invest.

TREASURY SECURITIES
Treasury securities are direct obligations of the federal government of the
United States. Treasury securities are generally regarded as having the
lowest credit risks.

AGENCY SECURITIES
Agency securities are issued or guaranteed by a federal agency or other
government sponsored entity (GSE) acting under federal authority. Some GSEs
are supported by the full faith and credit of the United States. These
include the Government National Mortgage Association, Small Business
Administration, Farm Credit System Financial Assistance Corporation, Farmer's
Home Administration, Federal Financing Bank, General Services Administration,
Department of Housing and Urban Development, Export-Import Bank, Overseas
Private Investment Corporation, and Washington Metropolitan Transit Authority
Bonds.

Other GSEs receive support through federal subsidies, loans or other
benefits. For example, the U.S. Treasury is authorized to purchase specified
amounts of securities issued by (or otherwise make funds available to) the
Federal Home Loan Bank System, Federal Home Loan Mortgage Corporation,
Federal National Mortgage Association, Student Loan Marketing Association,
and Tennessee Valley Authority in support of such obligations.

A few GSEs have no explicit financial support, but are regarded as having
implied support because the federal government sponsors their activities.
These include the Farm Credit System, Financing Corporation, and Resolution
Trust Corporation.

Investors regard agency securities as having low credit risks, but not as low
as Treasury securities.

A Fund treats mortgage backed securities guaranteed by a GSE as if issued or
guaranteed by a federal agency. Although such a guarantee protects against
credit risks, it does not reduce the market and prepayment risks.

CORPORATE DEBT SECURITIES
Corporate debt securities are fixed income securities issued by businesses.
Notes, bonds, debentures and commercial paper are the most prevalent types of
corporate debt securities. A Fund may also purchase interests in bank loans
to companies. The credit risks of corporate debt securities vary widely among
issuers.

In addition, the credit risk of an issuer's debt security may vary based on
its priority for repayment. For example, higher ranking (senior) debt
securities have a higher priority than lower ranking (subordinated)
securities. This means that the issuer might not make payments on
subordinated securities while continuing to make payments on senior
securities. In addition, in the event of bankruptcy, holders of senior
securities may receive amounts otherwise payable to the holders of
subordinated securities. Some subordinated securities, such as trust
preferred and capital securities notes, also permit the issuer to defer
payments under certain circumstances. For example, insurance companies issue
securities known as surplus notes that permit the insurance company to defer
any payment that would reduce its capital below regulatory requirements.

COMMERCIAL PAPER
Commercial paper is an issuer's obligation with a maturity of less than nine
months. Companies typically issue commercial paper to pay for current
expenditures. Most issuers constantly reissue their commercial paper and use
the proceeds (or bank loans) to repay maturing paper. If the issuer cannot
continue to obtain liquidity in this fashion, its commercial paper may
default. The short maturity of commercial paper reduces both the market and
credit risks as compared to other debt securities of the same issuer.

DEMAND INSTRUMENTS
Demand instruments are corporate debt securities that the issuer must repay
upon demand. Other demand instruments require a third party, such as a
dealer or bank, to repurchase the security for its face value upon demand. A
Fund treats demand instruments as short-term securities, even though their
stated maturity may extend beyond one year.

TAXABLE MUNICIPAL SECURITIES
Municipal securities are issued by states, counties, cities and other
political subdivisions and authorities. Although many municipal securities
are exempt from federal income tax, a Fund may invest in taxable municipal
securities.

MORTGAGE BACKED SECURITIES
Mortgage backed securities represent interests in pools of mortgages. The
mortgages that comprise a pool normally have similar interest rates,
maturities and other terms. Mortgages may have fixed or adjustable interest
rates. Interests in pools of adjustable rate mortgages are known as ARMs.

Mortgage backed securities come in a variety of forms. Many have extremely
complicated terms. The simplest form of mortgage backed securities are pass-
through certificates. An issuer of pass-through certificates gathers monthly
payments from an underlying pool of mortgages. Then, the issuer deducts its
fees and expenses and passes the balance of the payments onto the certificate
holders once a month. Holders of pass-through certificates receive a pro
rata share of all payments and pre-payments from the underlying mortgages.
As a result, the holders assume all the prepayment risks of the underlying
mortgages.

COLLATERALIZED MORTGAGE OBLIGATIONS (CMOS)
CMOs, including interests in real estate mortgage investment conduits
(REMICs), allocate payments and prepayments from an underlying pass-
through certificate among holders of different classes of mortgage- backed
securities. This creates different prepayment and interest rate risks for
each CMO class.

SEQUENTIAL CMOS
In a sequential pay CMO, one class of CMOs receives all principal
payments and prepayments. The next class of CMOs receives all
principal payments after the first class is paid off. This process
repeats for each sequential class of CMO. As a result, each class of
sequential pay CMOs reduces the prepayment risks of subsequent classes.

PACS, TACS AND COMPANION CLASSES
More sophisticated CMOs include planned amortization classes (PACs) and
targeted amortization classes (TACs). PACs and TACs are issued with
companion classes. PACs and TACs receive principal payments and
prepayments at a specified rate. The companion classes receive
principal payments and prepayments in excess of the specified rate. In
addition, PACs will receive the companion classes' share of principal
payments, if necessary, to cover a shortfall in the prepayment rate.
This helps PACs and TACs to control prepayment risks by increasing the
risks to their companion classes.

IOS AND POS
CMOs may allocate interest payments to one class (Interest Only or IOs)
and principal payments to another class (Principal Only or POs). POs
increase in value when prepayment rates increase. In contrast, IOs
decrease in value when prepayments increase, because the underlying
mortgages generate less interest payments. However, IOs tend to
increase in value when interest rates rise (and prepayments decrease),
making IOs a useful hedge against interest rate risks.

FLOATERS AND INVERSE FLOATERS
Another variant allocates interest payments between two classes of
CMOs. One class (Floaters) receives a share of interest payments based
upon a market index such as LIBOR. The other class (Inverse Floaters)
receives any remaining interest payments from the underlying mortgages.
Floater classes receive more interest (and Inverse Floater classes
receive correspondingly less interest) as interest rates rise. This
shifts prepayment and interest rate risks from the Floater to the
Inverse Floater class, reducing the price volatility of the Floater
class and increasing the price volatility of the Inverse Floater class.

Z CLASSES AND RESIDUAL CLASSES
CMOs must allocate all payments received from the underlying mortgages
to some class. To capture any unallocated payments, CMOs generally
have an accrual (Z) class. Z classes do not receive any payments from
the underlying mortgages until all other CMO classes have been paid
off. Once this happens, holders of Z class CMOs receive all payments
and prepayments. Similarly, REMICs have residual interests that
receive any mortgage payments not allocated to another REMIC class.

The degree of increased or decreased prepayment risks depends upon the
structure of the CMOs. However, the actual returns on any type of mortgage-
backed security depend upon the performance of the underlying pool of
mortgages, which no one can predict and will vary among pools.

ASSET-BACKED SECURITIES
Asset-backed securities are payable from pools of obligations other than
mortgages. Most asset-backed securities involve consumer or commercial debts
with maturities of less than ten years. However, almost any type of fixed
income assets (including other fixed income securities) may be used to create
an asset backed security. Asset- backed securities may take the form of
commercial paper, notes, or pass through certificates. Asset-backed
securities have prepayment risks. Like CMOs, asset backed securities may be
structured like Floaters, Inverse Floaters, IOs and POs.

ZERO COUPON SECURITIES
Zero coupon securities do not pay interest or principal until final maturity
unlike debt securities that provide periodic payments of interest (referred
to as a coupon payment). Investors buy zero coupon securities at a price
below the amount payable at maturity. The difference between the purchase
price and the amount paid at maturity represents interest on the zero coupon
security. Investors must wait until maturity to receive interest and
principal, which increases the market and credit risks of a zero coupon
security.

There are many forms of zero coupon securities. Some are issued at a
discount and are referred to as zero coupon or capital appreciation bonds.
Others are created from interest bearing bonds by separating the right to
receive the bond's coupon payments from the right to receive the bond's
principal due at maturity, a process known as coupon stripping. Treasury
STRIPs, IOs and POs are the most common forms of stripped zero coupon
securities. In addition, some securities give the issuer the option to
deliver additional securities in place of cash interest payments, thereby
increasing the amount payable at maturity. These are referred to as pay-in-
kind or PIK securities.

BANK INSTRUMENTS
Bank instruments are unsecured interest bearing deposits with banks. Bank
instruments include bank accounts, time deposits, certificates of deposit and
banker's acceptances. Yankee instruments are denominated in U.S. dollars and
issued by U.S. branches of foreign banks. Eurodollar instruments are
denominated in U.S. dollars and issued by non-U.S. branches of U.S. or
foreign banks.

CREDIT ENHANCEMENT
Common types of credit enhancement include guarantees, letters of credit,
bond insurance and surety bonds. Credit enhancement also includes
arrangements where securities or other liquid assets secure payment of a
fixed income security. If a default occurs, these assets may be sold and the
proceeds paid to security's holders. Either form of credit enhancement
reduces credit risks by providing another source of payment for a fixed
income security.

CONVERTIBLE SECURITIES
Convertible securities are fixed income securities that a Fund has the option to
exchange for equity securities at a specified conversion price. The option
allows a Fund to realize additional returns if the market price of the equity
securities exceeds the conversion price. For example, a Fund may hold fixed
income securities that are convertible into shares of common stock at a
conversion price of $10 per share. If the market value of the shares of common
stock reached $12, a Fund could realize an additional $2 per share by converting
its fixed income securities.

Convertible securities have lower yields than comparable fixed income
securities. In addition, at the time a convertible security is issued the
conversion price exceeds the market value of the underlying equity securities.
Thus, convertible securities may provide lower returns than non-convertible
fixed income securities or equity securities depending upon changes in the price
of the underlying equity securities. However, convertible securities permit a
Fund to realize some of the potential appreciation of the underlying equity
securities with less risk of losing its initial investment. The Equity Funds may
invest in commercial paper rated below investment grade. See "Risks Associated
with Non-investment Grade Securities" herein.

The Funds treat convertible securities as both fixed income and equity
securities for purposes of its investment policies and limitations, because of
their unique characteristics.

TAX EXEMPT SECURITIES
Tax exempt securities are fixed income securities that pay interest that is not
subject to regular federal income taxes. Typically, states, counties, cities and
other political subdivisions and authorities issue tax exempt securities. The
market categorizes tax exempt securities by their source of repayment.

VARIABLE RATE DEMAND INSTRUMENTS
Variable rate demand instruments are tax exempt securities that require the
issuer or a third party, such as a dealer or bank, to repurchase the security
for its face value upon demand. The securities also pay interest at a
variable rate intended to cause the securities to trade at their face value.
The Funds treat demand instruments as short-term securities even though their
maturity may extend beyond 397 days because, within 397 days, their variable
interest rate adjusts in response to changes in market rates and the
repayment of their principal amount can be demanded.

MUNICIPAL SECURITIES
Municipal securities are issued by states, counties, cities and other
political subdivisions and authorities. Although many municipal securities
are exempt from federal income tax, the Funds may invest in taxable municipal
securities.

MUNICIPAL NOTES
Municipal notes are short-term tax exempt securities. Many municipalities
issue such notes to fund their current operations before collecting taxes or
other municipal revenues. Municipalities may also issue notes to fund
capital projects prior to issuing long-term bonds. The issuers typically
repay the notes at the end of their fiscal year, either with taxes, other
revenues or proceeds from newly issued notes or bonds.

FOREIGN SECURITIES
Foreign securities are securities of issuers based outside the United States.
The Funds consider an issuer to be based outside the United States if:

{circle}it is organized under the laws of, or has a principal office located
in, another country;

{circle}the principal trading market for its securities is in another
country; or

{circle}it (or its subsidiaries) derived in its most current fiscal year at
least 50% of its total assets, capitalization, gross revenue or profit
from goods produced, services performed, or sales made in another country.

Foreign securities are primarily denominated in foreign currencies. Along with
the risks normally associated with domestic securities of the same type, foreign
securities are subject to currency risks and risks of foreign investing. Trading
in certain foreign markets is also subject to liquidity risks.

DEPOSITARY RECEIPTS
Depositary receipts represent interests in underlying securities issued by a
foreign company. Depositary receipts are not traded in the same market as
the underlying security. The foreign securities underlying American
Depositary Receipts (ADRs) are traded in the United States. ADRs provide a
way to buy shares of foreign-based companies in the United States rather than
in overseas markets. ADRs are also traded in U.S. dollars, eliminating the
need for foreign exchange transactions.

FOREIGN EXCHANGE CONTRACTS
In order to convert U.S. dollars into the currency needed to buy a foreign
security, or to convert foreign currency received from the sale of a foreign
security into U.S. dollars, the Fund may enter into spot currency trades. In
a spot trade, the Fund agrees to exchange one currency for another at the
current exchange rate. The Fund may also enter into derivative contracts in
which a foreign currency is an underlying asset. The exchange rate for
currency derivative contracts may be higher or lower than the spot exchange
rate. Use of these derivative contracts may increase or decrease the Fund's
exposure to currency risks.

FOREIGN GOVERNMENT SECURITIES
Foreign government securities generally consist of fixed income securities
supported by national, state or provincial governments or similar political
subdivisions. Foreign government securities also include debt obligations of
supranational entities, such as international organizations designed or
supported by governmental entities to promote economic reconstruction or
development, international banking institutions and related government
agencies. Examples of these include, but are not limited to, the
International Bank for Reconstruction and Development (the World Bank), the
Asian Development Bank, the European Investment Bank and the Inter-American
Development Bank.

Foreign government securities also include fixed income securities of quasi-
governmental agencies that are either issued by entities owned by a national,
state or equivalent government or are obligations of a political unit that
are not backed by the national government's full faith and credit. Further,
foreign government securities include mortgage-related securities issued or
guaranteed by national, state or provincial governmental instrumentalities,
including quasi-governmental agencies.

DERIVATIVE CONTRACTS
Derivative contracts are financial instruments that require payments based upon
changes in the values of designated (or underlying) securities, currencies,
commodities, financial indices or other assets. Some derivative contracts (such
as futures, forwards and options) require payments relating to a future trade
involving the underlying asset. Other derivative contracts (such as swaps)
require payments relating to the income or returns from the underlying asset.
The other party to a derivative contract is referred to as a counterparty.

Many derivative contracts are traded on securities or commodities exchanges. In
this case, the exchange sets all the terms of the contract except for the price.
Investors make payments due under their contracts through the exchange. Most
exchanges require investors to maintain margin accounts through their brokers to
cover their potential obligations to the exchange. Parties to the contract make
(or collect) daily payments to the margin accounts to reflect losses (or gains)
in the value of their contracts. This protects investors against potential
defaults by the counterparty. Trading contracts on an exchange also allows
investors to close out their contracts by entering into offsetting contracts.

For example, a Fund could close out an open contract to buy an asset at a future
date by entering into an offsetting contract to sell the same asset on the same
date. If the offsetting sale price is more than the original purchase price, a
Fund realizes a gain; if it is less, a Fund realizes a loss. Exchanges may
limit the amount of open contracts permitted at any one time. Such limits may
prevent a Fund from closing out a position. If this happens, a Fund will be
required to keep the contract open (even if it is losing money on the contract),
and to make any payments required under the contract (even if it has to sell
portfolio securities at unfavorable prices to do so). Inability to close out a
contract could also harm a Fund by preventing it from disposing of or trading
any assets it has been using to secure its obligations under the contract.

The Funds may also trade derivative contracts over-the-counter (OTC) in
transactions negotiated directly between a Fund and the counterparty. OTC
contracts do not necessarily have standard terms, so they cannot be directly
offset with other OTC contracts. In addition, OTC contracts with more
specialized terms may be more difficult to price than exchange traded contracts.

Depending upon how a Fund uses derivative contracts and the relationships
between the market value of a derivative contract and the underlying asset,
derivative contracts may increase or decrease a Fund's exposure to market and
currency risks, and may also expose a Fund to liquidity and leverage risks. OTC
contracts also expose a Fund to credit risks in the event that a counterparty
defaults on the contract.

The Large Cap Growth Fund II and certain Underlying Funds may trade in the
following types of derivative contracts.

FUTURES CONTRACTS
Futures contracts provide for the future sale by one party and purchase by
another party of a specified amount of an underlying asset at a specified
price, date, and time. Entering into a contract to buy an underlying asset
is commonly referred to as buying a contract or holding a long position in
the asset. Entering into a contract to sell an underlying asset is commonly
referred to as selling a contract or holding a short position in the asset.
Futures contracts are considered to be commodity contracts. The Fund has
claimed an exclusion from the definition of the term "commodity pool
operator" under the Commodity Exchange Act and, therefore, are not subject to
registration as a commodity pool operator under that Act. Futures contracts
traded OTC are frequently referred to as forward contracts.

The Funds may buy/sell financial futures contracts. Large Cap Value Fund II
and certain Underlying Funds (Mid Cap Stock Fund and Large Cap Value Fund)
may also buy/sell stock index futures contracts.

OPTIONS
Options are rights to buy or sell an underlying asset for a specified price
(the exercise price) during, or at the end of, a specified period. A call
option gives the holder (buyer) the right to buy the underlying asset from
the seller (writer) of the option. A put option gives the holder the right
to sell the underlying asset to the writer of the option. The writer of the
option receives a payment, or premium, from the buyer, which the writer keeps
regardless of whether the buyer uses (or exercises) the option.

The Funds may:

{circle}Buy call options on portfolio securities in anticipation of an
increase in the value of the underlying asset;

{circle}Buy put options on portfolio securities in anticipation of a decrease
in the value of the underlying asset.

Each Fund may also write call options on all or any portion of its portfolio
securities and on financial or stock index futures contracts (as permitted)
to generate income from premiums, and in anticipation of a decrease or only
limited increase in the value of the underlying asset. If a call written by a
Fund is exercised, a Fund foregoes any possible profit from an increase in
the market price of the underlying asset over the exercise price plus the
premium received.

Each Fund may also write put options on all or a portion of its portfolio
securities and on financial or stock index futures contracts (as permitted)
to generate income from premiums, and in anticipation of an increase or only
limited decrease in the value of the underlying asset. In writing puts, there
is a risk that a Fund may be required to take delivery of the underlying
asset when its current market price is lower than the exercise price.

When a Fund writes options on futures contracts, it will be subject to margin
requirements similar to those applied to futures contracts.

SWAP CONTRACTS
A swap contract (also known as a "swap") is a type of derivative contract in
which two parties (each, a "Counterparty") agree to pay each other (swap) the
returns derived from designated (or underlying) securities, currencies,
commodities, financial indices or other assets ("Reference Instruments").
Swaps do not always involve the delivery of the Reference Instruments by
either party, and the parties might not own the Reference Instruments
underlying the swap. The payments are usually made on a net basis so that, on
any given day, the Fund would receive (or pay) only the amount by which its
payment under the contract is less than (or exceeds) the amount of the other
party's payment. Swap agreements are sophisticated instruments that can take
many different forms and are known by a variety of names.

CREDIT DEFAULT SWAPS
A credit default swap (CDS) is a type of swap agreement between two parties
whereby one party (the "Protection Buyer") agrees to make payments over the
term of the CDS to the other party (the "Protection Seller"), provided that
no designated event of default, restructuring or other credit related event
(each a "Credit Event") occurs with respect to the Reference Instrument,
which is usually a particular bond or the unsecured credit of a particular
issuer (the "Reference Obligation"). Many CDSs are physically settled, which
means that if a Credit Event occurs, the Protection Seller must pay the
Protection Buyer the full notional value, or "par value," of the Reference
Obligation in exchange for delivery by the Protection Buyer of the Reference
Obligation or another similar obligation issued by the issuer of the
Reference Obligation (the "Deliverable Obligation"). The Counterparties
agree to the characteristics of the Deliverable Obligation at the time that
they enter into the CDS. Alternately, a CDS can be "cash settled," which
means that upon the occurrence of a Credit Event, the Protection Buyer will
receive a payment from the Protection Seller equal to the difference between
the par amount of the Reference Obligation and its market value at the time
of the Credit Event. The Fund may be either the Protection Buyer or the
Protection Seller in a CDS. If the Fund is a Protection Buyer and no Credit
Event occurs, the Fund will lose its entire investment in the CDS (i.e., an
amount equal to the payments made to the Protection Seller over the term of
the CDS). However, if a Credit Event occurs, the Fund (as Protection Buyer)
will deliver the Deliverable Obligation and receive a payment equal to the
full notional value of the Reference Obligation, even though the Reference
Obligation may have little or no value. If the Fund is the Protection Seller
and no Credit Event occurs, the Fund will receive a fixed rate of income
throughout the term of the CDS. However, if a Credit Event occurs, the Fund
(as Protection Seller) will pay the Protection Buyer the full notional value
of the Reference Obligation and receive the Deliverable Obligation from the
Protection Buyer. A CDS may involve greater risks than if the Fund invested
directly in the Reference Obligation. For example, a CDS may increase credit
risk since the Fund has exposure to both the issuer of the Reference
Obligation and the Counterparty to the CDS. The Reference Instruments
underlying each CDS will be of a credit quality at least equal to that of the
credit quality required for investment in individual securities by the
relevant Fund.

SPECIAL TRANSACTIONS

REPURCHASE AGREEMENTS
Repurchase agreements are transactions in which a Fund buys a security from a
dealer or bank and agrees to sell the security back at a mutually agreed upon
time and price. The repurchase price exceeds the sale price, reflecting a
Fund's return on the transaction. This return is unrelated to the interest
rate on the underlying security. A Fund will enter into repurchase
agreements only with banks and other recognized financial institutions, such
as securities dealers, deemed creditworthy by the Advisor.

The Funds' custodian or subcustodian will take possession of the securities
subject to repurchase agreements. The Advisor or subcustodian will monitor
the value of the underlying security each day to ensure that the value of the
security always equals or exceeds the repurchase price.

Repurchase agreements are subject to credit risks.

REVERSE REPURCHASE AGREEMENTS
Reverse repurchase agreements are repurchase agreements in which a Fund is
the seller (rather than the buyer) of the securities, and agrees to
repurchase them at an agreed upon time and price. A reverse repurchase
agreement may be viewed as a type of borrowing by a Fund. Reverse repurchase
agreements are subject to credit risks. In addition, reverse repurchase
agreements create leverage risks because a Fund must repurchase the
underlying security at a higher price, regardless of the market value of the
security at the time of repurchase.

DELAYED DELIVERY TRANSACTIONS
Delayed delivery transactions, including when issued transactions, are
arrangements in which a Fund buys securities for a set price, with payment
and delivery of the securities scheduled for a future time. During the
period between purchase and settlement, no payment is made by a Fund to the
issuer and no interest accrues to a Fund. A Fund records the transaction
when it agrees to buy the securities and reflects their value in determining
the price of its shares. Settlement dates may be a month or more after
entering into these transactions so that the market values of the securities
bought may vary from the purchase prices. Therefore, delayed delivery
transactions create interest rate risks for a Fund. Delayed delivery
transactions also involve credit risks in the event of a counterparty
default.

TO BE ANNOUNCED SECURITIES (TBAS)
As with other delayed delivery transactions, a seller agrees to issue a
TBA security at a future date. However, the seller does not specify the
particular securities to be delivered. Instead, a Fund agrees to accept
any security that meets specified terms. For example, in a TBA mortgage-
backed transaction, a Fund and the seller would agree upon the issuer,
interest rate and terms of the underlying mortgages. The seller would not
identify the specific underlying mortgages until it issues the security.
TBA mortgage-backed securities increase interest rate risks because the
underlying mortgages may be less favorable than anticipated by a Fund.

SECURITIES LENDING
A Fund may lend portfolio securities to borrowers that the Advisor deems
creditworthy. In return, a Fund receives cash or liquid securities from the
borrower as collateral. The borrower must furnish additional collateral if
the market value of the loaned securities increases. Also, the borrower must
pay a Fund the equivalent of any dividends or interest received on the loaned
securities.

A Fund will reinvest cash collateral in securities that qualify as an
acceptable investment for a Fund. However, a Fund must pay interest to the
borrower for the use of cash collateral.

Loans are subject to termination at the option of a Fund or the borrower. A
Fund will not have the right to vote on securities while they are on loan,
but it will terminate a loan in anticipation of any important vote. A Fund
may pay administrative and custodial fees in connection with a loan and may
pay a negotiated portion of the interest earned on the cash collateral to a
securities lending agent or broker.

Securities lending activities are subject to interest rate risks and credit
risks.

<R>

ASSET SEGREGATION
In accordance with the Securities and Exchange Commission (SEC) and SEC staff
positions regarding the interpretation of the Investment Company Act of 1940
(1940 Act), with respect to derivatives that create a future payment
obligation of a Fund, the Fund must "set aside" (referred to sometimes as
"asset segregation") liquid assets, or engage in other SEC- or staff-approved
measures, while the derivative contracts are open. For example, with respect
to forwards and futures contracts that are not contractually required to
"cash-settle," the Fund must cover its open positions by setting aside cash
or readily marketable securities equal to the contracts' full, notional
value. With respect to forwards and futures that are contractually required
to "cash-settle," however, the Fund is permitted to set aside cash or readily
marketable securities in an amount equal to the Fund's daily marked-to-market
(net) obligations, if any (i.e., the Fund's daily net liability, if any),
rather than the notional value.

The Funds will employ another approach to segregating assets to cover options
that they sell. If a Fund sells a call option, the Fund will set aside either
the Reference Instrument subject to the option, cash or readily marketable
securities with a value that equals or exceeds the current market value of
the Reference Instrument. In no event, will the value of the cash or readily
marketable securities set aside by the Fund be less than the exercise price
of the call option. If a Fund sells a put option, the Fund will set aside
cash or readily marketable securities with a value that equals or exceeds the
exercise price of the put option.

The Funds' asset segregation approach for swap agreements varies among
different types of swaps. For example, if a Fund enters into a credit default
swap as the Protection Buyer, then it will set aside cash or readily
marketable securities necessary to meet any accrued payment obligations under
the swap. By comparison, if a Fund enters into a credit default swap as the
Protection Seller, then the Fund will set aside cash or readily marketable
securities equal to the full notional amount of the swap that must be paid
upon the occurrence of a Credit Event. For some other types of swaps, such as
interest rate swaps, the Funds will calculate the obligations of the
counterparties to the swap on a net basis. Consequently, a Fund's current
obligation (or rights) under this type of swap will equal only the net amount
to be paid or received based on the relative values of the positions held by
each counterparty to the swap (the "net amount"). The net amount currently
owed by or to the Fund will be accrued daily and the Fund will set aside cash
or readily marketable securities equal to any accrued but unpaid net amount
owed by the Fund under the swap.

A Fund may reduce the liquid assets segregated to cover obligations under a
derivative contract by entering into an offsetting derivative contract. For
example, if a Fund sells a put option for the same Reference Instrument as a
call option the Fund has sold, and the exercise price of the call option is
the same as or higher than the exercise price of the put option, then the
Fund may net its obligations under the options and set aside cash or readily
marketable securities (including any margin deposited for the options) with a
value equal to the greater of (a) the current market value of the Reference
Instrument deliverable under the call option or (b) the exercise price of the
put option.

By setting aside cash or readily marketable securities equal to only its net
obligations under swaps and certain cash-settled derivative contracts, a Fund
will have the ability to employ leverage to a greater extent than if the Fund
were required to segregate cash or readily marketable securities equal to the
full notional value of such contracts. The use of leverage involves certain
risks. See "Investment Risks." Unless a Fund has other cash or readily
marketable securities to set aside, it cannot trade assets set aside in
connection with derivative contracts or special transactions without entering
into an offsetting derivative contract or terminating a special transaction.
This may cause the Fund to miss favorable trading opportunities or to realize
losses on derivative contracts or special transactions. The Funds reserve the
right to modify their asset segregation policies in the future to comply with
any changes in the positions articulated from time to time by the SEC and its
staff.

Generally, special transactions do not cash-settle on a net basis.
Consequently, with respect to special transactions, a Fund will set aside
cash or readily marketable securities with a value that equals or exceeds the
Fund's obligations.

With respect to short sales transactions, the Funds will set aside cash or
readily marketable securities in an amount equal to the greater of (i) the
market value of the securities sold short; and (ii) the market price at which
the short position was established, in each case less any margin on deposit.

</R>

INVESTING IN SECURITIES OF OTHER INVESTMENT COMPANIES

The Funds, and each Underlying Fund, may invest in securities of other
investment companies, including the securities of affiliated money market funds,
as an efficient means of carrying out their investment policies and managing
their uninvested cash. Conservative Growth Fund II, Moderate Growth Fund II and
Aggressive Growth Fund II intend to invest substantially all their assets in
Underlying Funds in order to achieve their investment goals. See "Investment
Risks-Fund Expenses" and "Investment Limitations- Investing in Other Investment
Companies" in this SAI.

EXCHANGE-TRADED FUND
The Funds may also invest in exchange-traded funds (ETFs) in order to implement
its investment strategies. The Shares of most ETFs are listed and traded on
stock exchanges at market prices, although some Shares may be redeemable at net
asset value for cash or securities. The Funds may invest in ETFs in order to
achieve exposure to a specific region, country or market sector, or for other
reasons consistent with its investment strategy. As with traditional mutual
funds, ETFs charge asset-based fees, although these fees tend to be relatively
low. ETFs generally do not charge initial sales charges or redemption fees and
investors pay only customary brokerage fees to buy and sell ETF shares.

SHORT SALES

The Large Cap Growth Fund II and certain Underlying Funds may make short sales
of securities listed on one or more national exchanges or on the Nasdaq Stock
Market. A short sale is the sale of a stock that the Fund does not own (or will
borrow for delivery), because the Fund believes the stock will decline in price
or the Fund wants to hedge against potential price volatility of the stock. If
the price of the stock declines, the Fund can buy the stock at a lower price and
will make a profit. If the price of the stock rises, the Fund will incur a
loss. When the Fund sells short, it borrows the stock from a broker "on
margin", and must pay interest to the broker on the margin amount until the
stock is replaced by the Fund. In no event will the Fund engage in short sales
transactions if it would cause the market value of all of the Fund's securities
sold short to exceed 25% of its net assets. The value of the securities of any
one issuer that may be shorted by the Fund is limited to the lesser of 2% of
the value of the Fund's net assets. The Fund may also "sell short against the
box," i.e., the Fund owns securities identical to those short. Short sales
against the box are not subject to the 25% limitation. Short sales are
speculative in nature, any may reduce returns or increase volatility. Short
sales involve Close Out Risks and Leverage Risks.

INVESTMENT RISKS

There are many factors which may affect an investment in the Funds. The Funds'
principal risks are described in the prospectus. Additional risk factors are
outlined below.

STOCK MARKET RISKS
The value of equity securities in a Fund's portfolio will rise and fall. These
fluctuations could be a sustained trend or a drastic movement. A Fund's
portfolio will reflect changes in prices of individual portfolio stocks or
general changes in stock valuations. Consequently, a Fund's share price may
decline.

The Advisor and subadvisor each attempts to manage market risk by limiting the
amount a Fund invests in each company's equity securities. However,
diversification will not protect a Fund against widespread or prolonged declines
in the stock market.

SECTOR RISKS
Companies with similar characteristics may be grouped together in broad
categories called sectors. Sector risk is the possibility that a certain sector
may underperform other sectors or the market as a whole. As the Advisor
allocates more of a Fund's portfolio holdings to a particular sector, a Fund's
performance will be more susceptible to any economic, business or other
developments which generally affect that sector.

LIQUIDITY RISKS
Trading opportunities are more limited for equity securities that are not widely
held. This may make it more difficult to sell or buy a security at a favorable
price or time. Consequently, a Fund may have to accept a lower price to sell a
security, sell other securities to raise cash or give up an investment
opportunity, any of which could have a negative effect on a Fund's performance.
Infrequent trading of securities may also lead to an increase in their price
volatility.

Trading opportunities are more limited for fixed income securities that have not
received any credit ratings, have received ratings below investment grade or are
not widely held.

Trading opportunities are more limited for CMOs that have complex terms or that
are not widely held. These features may make it more difficult to sell or buy a
security at a favorable price or time. Consequently, a Fund may have to accept a
lower price to sell a security, sell other securities to raise cash or give up
an investment opportunity, any of which could have a negative effect on a Fund's
performance. Infrequent trading of securities may also lead to an increase in
their price volatility.

Liquidity risk also refers to the possibility that a Fund may not be able to
sell a security or close out a derivative contract when it wants to. If this
happens, a Fund will be required to continue to hold the security or keep the
position open, and a Fund could incur losses.

OTC derivative contracts generally carry greater liquidity risk than exchange-
traded contracts.

RISKS RELATED TO INVESTING FOR GROWTH
Due to their relatively high valuations, growth stocks are typically more
volatile than value stocks. For instance, the price of a growth stock may
experience a larger decline on a forecast of lower earnings, a negative
fundamental development, or an adverse market development. Further, growth
stocks may not pay dividends or may pay lower dividends than value stocks. This
means they depend more on price changes for returns and may be more adversely
affected in a down market compared to value stocks that pay higher dividends.

RISKS RELATED TO INVESTING FOR VALUE
Due to their relatively low valuations, value stocks are typically less volatile
than growth stocks. For instance, the price of a value stock may experience a
smaller increase on a forecast of higher earnings, a positive fundamental
development, or positive market development. Further, value stocks tend to have
higher dividends than growth stocks. This means they depend less on price
changes for returns and may lag behind growth stocks in an up market.

RISKS RELATED TO COMPANY SIZE
Generally, the smaller the market capitalization of a company, the fewer the
number of shares traded daily, the less liquid its stock and the more volatile
its price. For example, medium capitalization stocks may be less liquid and more
volatile than stocks of larger, well-known companies. Market capitalization is
determined by multiplying the number of its outstanding shares by the current
market price per share.

Companies with smaller market capitalizations also tend to have unproven track
records, a limited product or service base and limited access to capital. These
factors also increase risks and make these companies more likely to fail than
companies with larger market capitalizations.

CURRENCY RISKS
Exchange rates for currencies fluctuate daily. The combination of currency risk
and market risk tends to make securities traded in foreign markets more volatile
than securities traded exclusively in the U.S.

The Advisor attempts to manage currency risk by limiting the amount a Fund
invests in securities denominated in a particular currency. However,
diversification will not protect a Fund against a general increase in the value
of the U.S. dollar relative to other currencies.

EURO RISKS
The Euro is the new single currency of the European Monetary Union (EMU). With
the advent of the Euro, the participating countries in the EMU can no longer
follow independent monetary policies. This may limit these countries' ability
to respond to economic downturns or political upheavals, and consequently reduce
the value of their foreign government securities.

RISKS OF FOREIGN INVESTING
Foreign securities pose additional risks because foreign economic or political
conditions may be less favorable than those of the United States. Securities in
foreign markets may also be subject to taxation policies that reduce returns for
U.S. investors.

Foreign companies may not provide information (including financial statements)
as frequently or to as great an extent as companies in the United States.
Foreign companies may also receive less coverage than United States companies by
market analysts and the financial press. In addition, foreign countries may
lack uniform accounting, auditing and financial reporting standards or
regulatory requirements comparable to those applicable to U.S. companies. These
factors may prevent a Fund and its Advisor from obtaining information concerning
foreign companies that is as frequent, extensive and reliable as the information
available concerning companies in the United States.

Foreign countries may have restrictions on foreign ownership of securities or
may impose exchange controls, capital flow restrictions or repatriation
restrictions which could adversely affect the liquidity of a Fund's investments.

To the extent a Fund invests in foreign securities, its share price may be more
affected by foreign economic and political conditions, taxation policies, and
accounting and auditing standards than would otherwise be the case.

LEVERAGE RISKS
Leverage risk is created when an investment exposes a Fund to a level of risk
that exceeds the amount invested. Changes in the value of such an investment
magnify a Fund's risk of loss and potential for gain.

INTEREST RATE RISKS
Prices of fixed income securities rise and fall in response to changes in the
interest rate paid by similar securities. Generally, when interest rates rise,
prices of fixed income securities fall. However, market factors, such as the
demand for particular fixed income securities, may cause the price of certain
fixed income securities to fall while the prices of other securities rise or
remain unchanged.

Interest rate changes have a greater effect on the price of fixed income
securities with longer durations. Duration measures the price sensitivity of a
fixed income security to changes in interest rates.

CREDIT RISKS
Credit risk is the possibility that an issuer will default on a security by
failing to pay interest or principal when due. If an issuer defaults, a Fund
will lose money.

Many fixed income securities receive credit ratings from services such as
Standard &amp; Poor's and Moody's Investor Services, Inc. These services assign
ratings to securities by assessing the likelihood of issuer default. Lower
credit ratings correspond to higher credit risk. If a security has not received
a rating, a Fund must rely entirely upon the Advisor's credit assessment.

Fixed income securities generally compensate for greater credit risk by paying
interest at a higher rate. The difference between the yield of a security and
the yield of a U.S. Treasury security with a comparable maturity (the spread)
measures the additional interest paid for risk. Spreads may increase generally
in response to adverse economic or market conditions. A security's spread may
also increase if the security's rating is lowered, or the security is perceived
to have an increased credit risk. An increase in the spread will cause the price
of the security to decline.

Credit risk includes the possibility that a party to a transaction involving a
Fund will fail to meet its obligations. This could cause a Fund to lose the
benefit of the transaction or prevent a Fund from selling or buying other
securities to implement its investment strategy.

CALL RISKS
Call risk is the possibility that an issuer may redeem a fixed income security
before maturity (a call) at a price below its current market price. An increase
in the likelihood of a call may reduce the security's price.

If a fixed income security is called, a Fund may have to reinvest the proceeds
in other fixed income securities with lower interest rates, higher credit risks,
or other less favorable characteristics.

PREPAYMENT RISKS
Generally, homeowners have the option to prepay their mortgages at any time
without penalty. Homeowners frequently refinance high interest rate mortgages
when mortgage rates fall. This results in the prepayment of mortgage backed
securities with higher interest rates. Conversely, prepayments due to
refinancings decrease when mortgage rates increase. This extends the life of
mortgage backed securities with lower interest rates. Other economic factors can
also lead to increases or decreases in prepayments. Increases in prepayments of
high interest rate mortgage backed securities, or decreases in prepayments of
lower interest rate mortgage backed securities, may reduce their yield and
price. These factors, particularly the relationship between interest rates and
mortgage prepayments makes the price of mortgage backed securities more volatile
than many other types of fixed income securities with comparable credit risks.

Mortgage backed securities generally compensate for greater prepayment risk by
paying a higher yield. The difference between the yield of a mortgage backed
security and the yield of a U.S. Treasury security with a comparable maturity
(the spread) measures the additional interest paid for risk. Spreads may
increase generally in response to adverse economic or market conditions. A
security's spread may also increase if the security is perceived to have an
increased prepayment risk or perceived to have less market demand. An increase
in the spread will cause the price of the security to decline.

A Fund may have to reinvest the proceeds of mortgage prepayments in other fixed
income securities with lower interest rates, higher prepayment risks, or other
less favorable characteristics.

RISKS ASSOCIATED WITH NONINVESTMENT GRADE SECURITIES
The convertible securities in which the Funds may invest may be rated below
investment grade. Securities rated below investment grade may be subject to the
same risks as those inherent in corporate debt obligations that are rated below
investment grade, also known as junk bonds. Junk bonds generally entail greater
market, credit and liquidity risks than investment grade securities. For
example, their prices are more volatile, economic downturns and financial
setbacks may affect their prices more negatively, and their trading market may
be more limited.

RISKS ASSOCIATED WITH COMPLEX CMOS
CMOs with complex or highly variable prepayment terms, such as companion
classes, IOs, POs, Inverse Floaters and residuals, generally entail greater
market, prepayment and liquidity risks than other mortgage backed securities.
For example, their prices are more volatile and their trading market may be more
limited.

FUND EXPENSES-MANAGED ALLOCATION FUNDS
Mutual fund portfolios bear charges for advisory fees and operational expenses.
The Conservative Growth Fund II, Moderate Growth Fund II and Aggressive Growth
Fund II and the Underlying Funds in which they invest each bear these expenses,
so investors in the Conservative Growth Fund II, Moderate Growth Fund II or
Aggressive Growth Fund II may bear higher expenses than a fund that invests
directly in equity, fixed income or money market securities.

EXCHANGE-TRADED FUNDS
An investment in an ETF generally presents the same primary risks as an
investment in a conventional fund (i.e., one that is not exchange traded) that
has the same investment objectives, strategies, and policies. The price of an
ETF can fluctuate up or down, and the Funds could lose money investing in an ETF
if the prices of the securities owned by the ETF go down. In addition, ETFs may
be subject to the following risks that do not apply to conventional funds: (i)
the market price of an ETF's shares may trade above or below their net asset
value; (ii) an active trading market for an ETF's shares may not develop or be
maintained; or (iii) trading of an ETF's share may be halted if the listing
exchange's officials deem such action appropriate, the share are delisted from
the exchange, or the activation of market-wide "circuit- breakers" (which are
tied to large decreases in stock prices) halts stock trading generally.

CLOSE-OUT RISKS
In a short sale transaction, close out risk is created by the ability of the
broker to request at any time that the fund closes out its short position in the
security. The broker's call request would force the Fund to purchase the
security at its current market price, and thus could result in a loss to the
Fund.

STATE INSURANCE REGULATIONS

The Funds are intended to be funding vehicles for variable annuity contracts and
variable life insurance policies offered by certain insurance companies. The
contracts will seek to be offered in as many jurisdictions as possible. Certain
states have regulations concerning, among other things, the concentration of
investments, sales and purchases of futures contracts, and short sales of
securities. If applicable, the Funds may be limited in their ability to engage
in such investments and to manage their portfolios with desired flexibility. The
Funds will operate in material compliance with the applicable insurance laws and
regulations of each jurisdiction in which contracts will be offered by the
insurance companies which invest in the Funds.

VARIABLE ASSET REGULATIONS

The Funds are also subject to variable contract asset regulations prescribed by
the U.S. Treasury Department under Section 817(h) of the Internal Revenue Code.
After a one year start-up period, the regulations generally require that, as of
the end of each calendar quarter or within 30 days thereafter, no more than 55%
of the total assets of each Fund may be represented by any one investment, no
more than 70% of the total assets of each Fund may be represented by any two
investments, no more than 80% of the total assets of each Fund may be
represented by any three investments, and no more than 90% of the total assets
of each Fund may be represented by any four investments. In applying these
diversification rules, all securities of the same issuer, all interests of the
same real property project and all interests in the same commodity are each
treated as a single investment. In the case of government securities, each
government agency or instrumentality shall be treated as a separate issuer. If
the Funds fail to achieve the diversification required by the regulations, and
unless relief is obtained from the Internal Revenue Service, the contracts
invested in a Fund will not be treated as annuity, endowment, or life insurance
contracts.

MIXED FUNDING AND SHARED FUNDING

<R>
As noted previously, the Funds were established exclusively for the purpose of
providing an investment vehicle for variable annuity contracts and variable life
insurance policies offered by separate accounts of participating insurance
companies. The Trust is permitted to engage in "mixed funding" (using shares as
investments for both variable annuity contracts and variable life insurance
policies) and "shared funding" (using shares as investments for separate
accounts of unaffiliated life insurance companies) pursuant to an exemption from
the Securities and Exchange Commission (SEC), and currently is engaged in shared
funding arrangements and must comply with conditions of the SEC exemption that
are designed to protect investors in the Funds. Although the Funds do not
currently see any disadvantage to contract owners due to differences in
redemption rates, tax treatment or other considerations resulting from mixed
funding or shared funding, the SEC only requires the Trustees to monitor the
operation of mixed funding and shared funding arrangements, and to consider
appropriate action to avoid material conflicts, and to take appropriate action
in response to any material conflicts which occur. Such action could result in
one or more participating insurance companies withdrawing their investment in a
Fund.

The Funds are authorized to pay financial institutions (primarily life insurance
companies), a fee at the maximum annual rate of 0.35% (composed of 0.25%
distribution (12b-1) fee and a 0.10% shareholder services fee)of the average
daily net assets of Shares for which a financial institution provides
distribution-related, shareholder and/or recordkeeping services. In addition,
MTBIA and its affiliates may pay out of their own reasonable resources and
profits to these financial institutions an additional fee for providing these
services.
</R>
FUNDAMENTAL INVESTMENT OBJECTIVES

<R>

The Large Cap Growth Fund II's investment objective is to provide capital
appreciation.

The Large Cap Value Fund II's investment objective is to provide capital
appreciation. Current income is a secondary, non-fundamental investment
consideration.

The Conservative Growth Fund II's investment objective is to seek capital
appreciation and income.

The Moderate Growth Fund II's investment objective is to seek capital growth.
Income is a secondary objective.

The Aggressive Growth Fund II's investment objective is to seek capital
appreciation.

Unless otherwise stated above, all of the investment objectives listed above are
fundamental. The investment objective may not be changed by the Funds' Trustees
without shareholder approval.

</R>

INVESTMENT LIMITATIONS

Each Fund may, in the future, seek to achieve the Fund's investment objectives
by investing all of the Fund's assets in a no-load, open-end management
investment company having substantially the same investment objectives as the
Fund. The Fund's investment policies permit such an investment. Shareholders
will receive prior written notice with respect to any such investment.

ISSUING SENIOR SECURITIES AND BORROWING MONEY
Each Fund may borrow money, directly or indirectly, and issue senior
securities, to the maximum extent permitted under the Investment Company
Act of 1940 (1940 Act), any rule or order thereunder, or any SEC staff
interpretation thereof.

UNDERWRITING
The Funds may not underwrite the securities of other issuers, except that
the Funds may engage in transactions involving the acquisition,
disposition or resale of their portfolio securities, under circumstances
where the Funds may be considered to be an underwriter under the
Securities Act of 1933.

INVESTING IN REAL ESTATE
The Funds may not purchase or sell real estate, provided that this restriction
does not prevent the Funds from investing in issuers which invest, deal, or
otherwise engage in transactions in real estate or interests therein, or
investing in securities that are secured by real estate or interests therein.
The Funds may exercise their rights under agreements relating to such
securities, including the right to enforce security interests and hold real
estate acquired by reason of such enforcement until that real estate can be
liquidated in an orderly manner.

LENDING CASH OR SECURITIES
The Funds may not make loans, provided that this restriction does not
prevent the Funds from purchasing debt obligations, entering into
repurchase agreements, lending their assets to broker/dealers or
institutional investors and investing in loans, including assignments and
participation interests.

INVESTING IN COMMODITIES
The Funds may not purchase or sell physical commodities, provided that the Funds
may purchase securities of companies that deal in commodities. For purposes of
this restriction, investments in transactions involving futures contracts and
options, forward currency contracts, swap transactions and other financial
contracts that settle by payment of cash are not deemed to be investments in
commodities.
CONCENTRATION OF INVESTMENTS
The Funds will not make investments that will result in the concentration
of their investments in the securities of issuers primarily engaged in the
same industry. For purposes of this restriction, the term concentration
has the meaning set forth in the 1940 Act, any rule or order thereunder,
or any SEC staff interpretation thereof. Government securities and
municipal securities will not be deemed to constitute an industry.

DIVERSIFICATION
With respect to securities comprising 75% of the value of its total assets, the
Funds will not purchase securities of any one issuer (other than cash; cash
items; securities issued or guaranteed by the government of the United States or
its agencies or instrumentalities and repurchase agreements collateralized by
such U.S. government securities; and securities of other investment companies)
if, as a result, more than 5% of the value of its total assets would be invested
in the securities of that issuer, or the Funds would own more than 10% of the
outstanding voting securities of that issuer.

THE ABOVE LIMITATIONS CANNOT BE CHANGED UNLESS AUTHORIZED BY THE BOARD OF
TRUSTEES (BOARD) AND BY THE "VOTE OF A MAJORITY OF ITS OUTSTANDING VOTING
SECURITIES," AS DEFINED BY THE 1940 ACT. THE FOLLOWING LIMITATIONS, HOWEVER, MAY
BE CHANGED BY THE BOARD WITHOUT SHAREHOLDER APPROVAL. SHAREHOLDERS WILL BE
NOTIFIED BEFORE ANY MATERIAL CHANGE IN THESE LIMITATIONS BECOMES EFFECTIVE.

BUYING ON MARGIN
The Funds will not purchase securities on margin, provided that the Funds may
obtain short-term credits necessary for the clearance of purchases and sales of
securities, and further provided that the Funds may make margin deposits in
connection with its use of financial options and futures, forward and spot
currency contracts, swap transactions and other financial contracts or
derivative instruments.

ILLIQUID SECURITIES

A Fund may not purchase or acquire any security if, as a result, more than 15%
of its net assets would be invested in securities that are illiquid.

PLEDGING ASSETS

The Funds will not mortgage, pledge, or hypothecate any of their assets,
provided that this shall not apply to the transfer of securities in connection
with any permissible borrowing or to collateral arrangements in connection with
permissible activities.

INVESTING IN OTHER INVESTMENT COMPANIES

The Funds may invest their assets in securities of other investment companies,
including ETFs, as an efficient means of carrying out their investment policies.
It should be noted that investment companies incur certain expenses, such as
management fees, and, therefore, any investment by the Funds in shares of other
investment companies may be subject to such duplicate expenses. At the present
time, the Funds expect that their investments in other investment companies may
include shares of money market funds, including funds affiliated with the Funds'
investment advisor, and ETFs with respect to Large Cap Value II and Large Cap
Growth II. In addition, Conservative Growth Fund II, Moderate Growth Fund II and
Aggressive Growth Fund II intend to invest substantially all of their assets in
Underlying Funds.

In applying the Funds' concentration restriction: (a) utility companies will be
divided according to their services, for example, gas, gas transmission,
electric and telephone will each be considered a separate industry; (b)
financial service companies will be classified according to the end users of
their services, for example, automobile finance, bank finance and diversified
finance will each be considered a separate industry; and (c) asset-backed
securities will be classified according to the underlying assets securing such
securities. To conform to the current view of the SEC that only domestic bank
instruments may be excluded from industry concentration limitations, as a matter
of non-fundamental policy, the Funds will not exclude foreign bank instruments
from industry concentration limits as long as the policy of the SEC remains in
effect. In addition, investments in bank instruments, and investments in certain
industrial development bonds funded by activities in a single industry, will be
deemed to constitute investment in an industry, except when held for temporary
defensive purposes. The investment of more than 25% of the value of the Funds'
total assets in any one industry will constitute "concentration."
Except with respect to borrowing money, if a percentage limitation is adhered to
at the time of investment, a later increase or decrease in percentage resulting
from any change in value or net assets will not result in a violation of such
restriction. Only the Large Cap Growth Fund II has any present intent to borrow
money in excess of 5% of the value of its net assets during the coming fiscal
year.

For purposes of its policies and limitations, the Funds consider certificates of
deposit and demand and time deposits issued by a U.S. branch of a domestic bank
or savings and loan having capital, surplus, and undivided profits in excess of
$100,000,000 at the time of investment to be "cash items."

The Underlying Funds in which Conservative Growth Fund II, Moderate Growth Fund
II and Aggressive Growth Fund II may invest have adopted certain investment
restrictions which may be more or less restrictive than those listed above,
thereby allowing Conservative Growth Fund II, Moderate Growth Fund II and
Aggressive Growth Fund II to participate in certain investment strategies
indirectly that may be prohibited under the fundamental and non-fundamental
investment restrictions and policies listed above.

PORTFOLIO TURNOVER

The portfolio turnover rate for each Fund is calculated by dividing the lesser
of a Fund's purchases or sales of portfolio securities for the year by the
monthly average value of the portfolio securities. The SEC requires that the
calculation exclude all securities whose remaining maturities at the time of
acquisition were one year or less.

The portfolio turnover rate for a Fund may vary greatly from year to year, and
may also be affected by cash management requirements for share redemptions. High
portfolio turnover rates will generally result in higher transaction costs,
including brokerage commissions, to a Fund and may result in tax consequences to
shareholders. Portfolio turnover will not be a limiting factor in making
investment decisions.

For the respective fiscal years ended December 31, 2006, and December 31, 2005,
the portfolio turnover rates were 17% and 35% for the Large Cap Growth Fund II,
20% and 13% for the Large Cap Value Fund II, 17% and 35% for the Managed
Allocation Fund- Conservative Growth II, 21% and 14% for the Managed Allocation
Fund- Moderate Growth II, and 15% and 1% for the Managed Allocation Fund-
Aggressive Growth II.

DETERMINING MARKET VALUE OF SECURITIES

Market values of the Funds' portfolio securities are determined as follows:

{circle}for equity securities, according to the last sale price in the market
in which they are primarily traded (either a national securities exchange
or the over-the-counter market), if available;

{circle}in the absence of recorded sales for equity securities, according to
the mean between the last closing bid and asked prices;

{circle}futures contracts and options are generally valued at market values
established by the exchanges on which they are traded at the close of
trading on such exchanges. Options traded in the over-the-counter market
are generally valued according to the mean between the last bid and the
last asked price for the option as provided by an investment dealer or
other financial institution that deals in the option. The Board may
determine in good faith that another method of valuing such investments is
necessary to appraise their fair market value;

{circle}for fixed income securities, according to the mean between bid and
asked prices as furnished by an independent pricing service, except that
fixed income securities with remaining maturities of less than 60 days at
the time of purchase may be valued at amortized cost;

{circle}for investments in other open-ended regulated investment companies,
based on net asset value; and

{circle}for all other securities at fair value as determined in accordance
with procedures established by and under the general supervision of the
Trustees.

Prices provided by independent pricing services may be determined without
relying exclusively on quoted prices and may consider institutional trading in
similar groups of securities, yield, quality, stability, risk, coupon rate,
maturity, type of issue, trading characteristics, and other market data or
factors. From time to time, when prices cannot be obtained from an independent
pricing service, securities may be valued based on quotes from broker-dealers or
other financial institutions that trade the securities.

TRADING IN FOREIGN SECURITIES
Trading in foreign securities may be completed at times which vary from the
closing of the New York Stock Exchange (NYSE). In computing its NAV, a Fund
values foreign securities at the latest closing price on the exchange on which
they are traded immediately prior to the closing of the NYSE. Certain foreign
currency exchange rates may also be determined at the latest rate prior to the
closing of the NYSE. Foreign securities quoted in foreign currencies are
translated into U.S. dollars at current rates. Occasionally, events that affect
these values and exchange rates may occur between the times at which they are
determined and the closing of the NYSE. If such events materially affect the
value of portfolio securities, these securities may be valued at their fair
value as determined in good faith by the Funds' Board, although the actual
calculation may be done by others.

WHAT DO SHARES COST?

Each Fund's net asset value (NAV) per Share fluctuates and is based on the
market value of all securities and other assets of a Fund.

HOW ARE THE FUNDS SOLD?

Under the Distributor's Contract with the Funds, the Distributor (Edgewood
Services, Inc.) offers Shares on a continuous, best-efforts basis.

RULE 12B-1 PLAN
As a compensation-type plan, the Rule 12b-1 Plan is designed to pay a financial
intermediary (including the Distributor, the Advisor and their affiliates) for
activities principally intended to result in the sale of Shares such as
advertising and marketing of Shares (including printing and disseminating
prospectuses and sales literature to prospective shareholders and financial
intermediaries) and providing incentives to financial intermediaries to sell
Shares. The Plan is also designed to cover the cost of administrative services
performed in conjunction with the sale of Shares, including, but not limited to,
shareholder services, recordkeeping services and educational services, as well
as the costs of implementing and operating the Plan. In accordance with the
Distribution Plan, the Distributor or the Funds may enter into agreements with
brokers and dealers relating to distribution and/or marketing services with
respect to the Funds. The Distributor or the Funds may also enter into Rule
12b-1 related agreements with administrators (including financial
intermediaries, fiduciaries, custodians for public funds, and investment
advisers) to provide distribution related and other services with respect to the
Funds. The Rule 12b-1 Plan is expected to benefit a Fund in a number of ways.
For example, it is anticipated that the Plan will help a Fund attract and retain
assets, thus providing cash for orderly portfolio management and Share
redemptions and possibly helping to stabilize or reduce other operating
expenses.

A Fund may compensate a financial intermediary more or less than its actual
marketing and administrative expenses. In no event will a Fund pay for any
expenses of a financial intermediary that exceed the maximum Rule 12b-1 Plan fee
of 0.25% of the Funds' average daily net assets.

The maximum Rule 12b-1 Plan fee that can be paid in any one year may not be
sufficient to cover the marketing-related expenses the financial intermediary
has incurred. Therefore, it may take the financial intermediary a number of
years to recoup these expenses.

SHAREHOLDER SERVICES PLAN
The Funds may pay financial intermediaries, including the Distributor, the
Advisor and their affiliates a maximum annual fee of 0.10% of the Funds' average
daily net assets for providing shareholder services and maintaining shareholder
accounts. The financial intermediary may select others to perform these services
for their customers and may pay them fees.

ADDITIONAL PAYMENTS TO FINANCIAL INTERMEDIARIES
In addition to the Rule 12b-1 and/or shareholder services fees that a Fund pays
to financial intermediaries, the Distributor, its affiliate Federated Services
Company, and the Advisor and its affiliates may pay out of their own reasonable
resources and profits amounts (including items of material value) to certain
financial intermediaries. While NASD regulations limit the sales charges that
you may bear as a Fund shareholder, there are no limits with regard to the
amounts that the Distributor, the Advisor and their affiliates may pay out of
their own resources. You can ask your financial intermediary for information
about any payments it receives from the Distributor, the Advisor and their
affiliates for any service the financial intermediary provides.

The following examples illustrate the types of instances in which the
Distributor, the Advisor and their affiliates may make additional payments to
financial intermediary.

SUPPLEMENTAL PAYMENTS
Financial intermediaries may be paid fees out of the assets of the Distributor,
its affiliate Federated Services Company, and the Advisor and its affiliates
(but not out of Fund assets).

Financial intermediaries may receive fees for providing distribution-related,
recordkeeping or shareholder services such as sponsoring sales, providing sales
literature, conducting training seminars for employees, and engineering sales-
related computer software programs and systems. Also, financial intermediaries
may be paid cash or promotional incentives, such as reimbursement of certain
expenses relating to attendance at informational meetings about a Fund or other
special events at recreational-type facilities, or items of material value.
These payments will be based upon the amount of Shares the financial
intermediary sells or may sell and/or upon the type and nature of sales or
marketing support furnished by the financial intermediary.

PROCESSING SUPPORT PAYMENTS
The Distributor, the Advisor and their affiliates may make payments to financial
intermediaries that sell Fund Shares to help offset their costs associated with
client account maintenance support, statement processing and transaction
processing. The types of payments that they may make under this category
include: payment of ticket charges on a per transaction basis; payment of
networking fees; and payment for ancillary services such as setting up funds on
the financial intermediaries' mutual fund trading system.

OTHER BENEFITS TO FINANCIAL INTERMEDIARIES
From time to time, the Distributor, the Advisor and their affiliates, at their
expense, may provide additional compensation to financial intermediaries that
sell or arrange for the sale of Shares. Such compensation may include financial
assistance to financial intermediaries that enable the Distributor, the Advisor
and their affiliates to participate in or present at conferences or seminars,
sales or training programs for invited employees, client and investor events and
other financial intermediary-sponsored events.

The Distributor, the Advisor and their affiliates also may hold or sponsor, at
their expense, sales events, conferences and programs for employees or
associated persons of financial intermediaries and may pay the travel and
lodging expenses of attendees. The Distributor, the Advisor and their
affiliates also may provide, at their expense, meals and entertainment in
conjunction with meetings with financial intermediaries. Other compensation may
be offered to the extent not prohibited by applicable laws, regulations or the
rules of any self-regulatory agency, such as the NASD.

SUBACCOUNTING SERVICES

Certain participating insurance companies may wish to use the transfer agent's
subaccounting system to minimize their internal recordkeeping requirements. The
transfer agent may charge a fee based on the level of subaccounting services
rendered. Participating insurance companies holding Shares in a fiduciary,
agency, custodial, or similar capacity may charge or pass through subaccounting
fees as part of or in addition to normal trust or agency account fees. They may
also charge fees for other services that may be related to the ownership of
Shares. This information should, therefore, be read together with any agreement
between the customer and the participating insurance company about the services
provided, the fees charged for those services, and any restrictions and
limitations imposed.

REDEMPTION IN KIND

Although each Fund intends to pay Share redemptions in cash, it reserves the
right, as described below, to pay the redemption price in whole or in part by a
distribution of a Fund's portfolio securities.

Because the Funds have elected to be governed by Rule 18f-1 under the Investment
Company Act of 1940, each Fund is obligated to pay Share redemptions to any one
shareholder in cash only up to the lesser of $250,000 or 1% of the net assets
represented by such Share class during any 90-day period.

Any Share redemption payment greater than this amount will also be in cash
unless the Funds' Board determines that payment should be in kind. In such a
case, a Fund will pay all or a portion of the remainder of the redemption in
portfolio securities, valued in the same way as a Fund determines its NAV. The
portfolio securities will be selected in a manner that the Funds' Board deems
fair and equitable and, to the extent available, such securities will be readily
marketable.

Redemption in kind is not as liquid as a cash redemption. If redemption is made
in kind, shareholders receiving the portfolio securities and selling them before
their maturity could receive less than the redemption value of the securities
and could incur certain transaction costs.

ACCOUNT AND SHARE INFORMATION

VOTING RIGHTS
The insurance company separate accounts, as shareholders of the Funds, will vote
the Funds' Shares held in their separate accounts at meetings of the
shareholders. Voting will be in accordance with instructions received from
contract owners of the separate accounts, as more fully outlined in the
prospectus of the separate account.

Each Share of a Fund gives the shareholder one vote in Trustee elections and
other matters submitted to shareholders for vote.

All Shares of the Trust have equal voting rights, except that in matters
affecting only a particular Fund or class, only Shares of that Fund or class are
entitled to vote.

Trustees may be removed by the Board or by shareholders at a special meeting. A
special meeting of shareholders will be called by the Board upon the written
request of shareholders who own at least 10% of the Trust's outstanding shares
of all series entitled to vote.

<R>

As of April 9, 2007, the following shareholders owned of record, beneficially,
or both, 5% or more of outstanding Shares:

FUND SHAREHOLDER NAME ADDRESS PERCENTAGE OWNED

Large Cap Growth Fund II Nationwide Insurance Company 67.33%
Columbus, OH
Hartford Life Insurance Co. 30.86%
Hartford, CT
Large Cap Value Fund II Nationwide Insurance Company 56.93%
Columbus, OH
Hartford Life Insurance Co. 36.86%
Hartford, CT
Conservative Growth Fund II Hartford Life Insurance Co. 38.42%
Hartford, CT
Nationwide Insurance Company 33.22%
Columbus, OH
Transamerica Financial Life Insurance 28.30%
Cedar Rapids, IA
Moderate Growth Fund II Nationwide Insurance Company 81.69%
Columbus, OH
Hartford Life Insurance Co. 14.48%
Hartford, CT
Aggressive Growth Fund II Nationwide Insurance Company 53.46%
Columbus, OH
Hartford Life Insurance Co. 37.51%
Hartford, CT
Transamerica Financial Life Insurance 5.85%
Cedar Rapids, IA

Shareholders owning 25% or more of outstanding Shares may be in control and be
able to affect the outcome of certain matters presented for a vote of
shareholders.

Nationwide Insurance Company is organized in the State of Ohio and is a
subsidiary of Nationwide Mutual Insurance company; organized in the State of
Ohio.

Transamerica Financial Life Insurance Company is organized in the State of Iowa.

Hartford Life Insurance Company is organized in the State of Connecticut and is
a subsidiary of Hartford Financial Services Group, organized in the State of
Delaware.

</R>

TAX INFORMATION

FEDERAL INCOME TAX
Each Fund intends to meet requirements of Subchapter M of the Internal Revenue
Code applicable to regulated investment companies. If these requirements are not
met, it will not receive special tax treatment and will be subject to federal
corporate income tax.

Each Fund will be treated as a single, separate entity for federal income tax
purposes so that income earned and capital gains and losses realized by the
Trust's other portfolios will be separate from those realized by a Fund.

Each Fund must, and intends to, comply with the diversification requirements
imposed by Section 817(h) of the Internal Revenue Code. For information
concerning the consequence of a Fund not meeting the Section 817(h)
requirements, see the prospectus of the separate account.

The Treasury Department announced that it would issue future regulations or
rulings addressing the circumstances in which a variable contract owner's
control of the investments of the separate account may cause the contract owner,
rather than the insurance company, to be treated as the owner of the assets held
by the separate account. If the contract owner is considered the owner of the
securities underlying the separate account, income and gains produced by those
securities would be included currently in the contract owner's gross income. It
is not known what standards will be set forth in the regulations or rulings.

FOREIGN INVESTMENTS
If a Fund purchases foreign securities, their investment income may be subject
to foreign withholding or other taxes that could reduce the return on these
securities. Tax treaties between the United States and foreign countries,
however, may reduce or eliminate the amount of foreign taxes to which a Fund
would be subject. The effective rate of foreign tax cannot be predicted since
the amount of Fund assets to be invested within various countries is uncertain.
However, the Funds intend to operate so as to qualify for treaty-reduced tax
rates when applicable.

Distributions from a Fund may be based on estimates of book income for the year.
Book income generally consists solely of the coupon income generated by the
portfolio, whereas tax-basis income includes gains or losses attributable to
currency fluctuation. Due to differences in the book and tax treatment of fixed-
income securities denominated in foreign currencies, it is difficult to project
currency effects on an interim basis. Therefore, to the extent that currency
fluctuations cannot be anticipated, a portion of distributions to shareholders
could later be designated as a return of capital, rather than income, for income
tax purposes, which may be of particular concern to simple trusts.

If a Fund invests in the stock of certain foreign corporations, they may
constitute Passive Foreign Investment Companies (PFIC), and a Fund may be
subject to Federal income taxes upon disposition of PFIC investments.

WHO MANAGES AND PROVIDES SERVICES TO THE FUNDS?

BOARD OF TRUSTEES
The Board is responsible for managing the Trust's business affairs and for
exercising all the Trust's powers except those reserved for the shareholders.
The following tables give information about each Board member and the senior
officers of the Funds. Where required, the tables separately list Board members
who are "interested persons" of the Funds (i.e., "Interested" Board members) and
those who are not (i.e., "Independent" Board members). Each Board member
oversees all portfolios of the Trust and serves for an indefinite term.
Information about each Board member is provided below and includes each
person's: name, address, birthdate, present position(s) held with the Trust,
principal occupations for the past five years, other directorships held, and
total compensation received as a Trustee from the Trust for its most recent
fiscal year applicable to MTB Large Cap Growth Fund II, MTB Large Cap Value Fund
II, MTB Managed Allocation Fund - Conservative Growth II, MTB Managed Allocation
Fund - Moderate Growth II and MTB Managed Allocation Fund - Aggressive Growth II
(December 31, 2006). The Trust is composed of 36 funds and is the only
investment company in the Fund Complex.

<R>

INTERESTED TRUSTEE BACKGROUND AND COMPENSATION

NAME
ADDRESS TOTAL
BIRTH DATE COMPENSATION
POSITION WITH TRUST FROM
DATE SERVICE BEGAN PRINCIPAL OCCUPATIONS FOR PAST FIVE YEARS AND OTHER DIRECTORSHIPS HELD TRUST

MARK J. CZARNECKI* PRINCIPAL OCCUPATIONS: Executive Vice President, M&amp;T Bank Holding Corp., (bank $0
Manufacturers and Traders holding company).
Trust Company
One M&amp;T Plaza
("M&amp;T Bank") OTHER DIRECTORSHIPS HELD: None
Buffalo, NY 14203
Birthdate: November 3,
1955

TRUSTEE

Began serving: August 2000

______________________________________________________________________________________

* Mark J. Czarnecki is "interested" due to positions he holds with M&amp;T Bank, the
parent of the Funds' advisor.

INDEPENDENT TRUSTEES BACKGROUND AND COMPENSATION

NAME
ADDRESS TOTAL
BIRTH DATE COMPENSATION
POSITION PRINCIPAL OCCUPATIONS FOR PAST FIVE YEARS AND OTHER DIRECTORSHIPS HELD FROM
WITH TRUST TRUST
DATE SERVICE
BEGAN

JOSEPH J. PRINCIPAL OCCUPATIONS: Chairman, Community Foundation for Greater Buffalo,; Chairman, Buffalo $56,000
CASTIGLIA Olmsted Parks Conservancy.
Roycroft OTHER DIRECTORSHIPS HELD: The Energy East Corp.; Community Foundation for Greater Buffalo.
Campus
21 South Previous Positions: President, Chief Executive Officer and Vice Chairman, Pratt &amp; Lambert
Grove United, Inc. (manufacturer of paints and chemical specialties).
Street,
Suite 290
East
Aurora, NY
14052
Birth
date: July
20, 1934

CHAIRMAN
AND TRUSTEE

Began
serving:
February
1988
WILLIAM H. PRINCIPAL OCCUPATIONS: Retired. $51,000
COWIE, JR.
1408 Ruxton OTHER DIRECTORSHIPS HELD: None
Road
Baltimore, PREVIOUS POSITIONS: Vice Chairman of Signet Banking Corp.,
MD 21204
Birth date:
January 24,
1931

TRUSTEE

Began
serving:
September
2003
JOHN S. PRINCIPAL OCCUPATIONS: Senior Consultant, Yaffe &amp; Co., Inc., (health care company) since $48,000
CRAMER February 2006.
299 Beacon
Drive OTHER DIRECTORSHIPS HELD: Highmark Blue Cross Blue Shield; Chek-Med Corporation.
Harrisburg,
PA 17112 PREVIOUS POSITIONS: President Emeritus, Pinnacle Health Systems (health care).
Birth date:
February 22,
1942

TRUSTEE

Began
serving:
December
2000
DANIEL R. PRINCIPAL OCCUPATIONS: President and CFO, Gernatt Family Companies; Executive Vice $46,000
GERNATT, JR. President, Dan Gernatt Gravel Products, Inc.; Vice President, Country Side Sand &amp; Gravel, Inc.
13870 Taylor
Hollow Roads OTHER DIRECTORSHIPS HELD: None
Collins, NY
14034
Birth date:
July 14,
1940

TRUSTEE

Began
serving:
February
1988
RICHARD B. PRINCIPAL OCCUPATIONS: Chairman and Director, (since 1995) of Girard Partners, a $51,000
SEIDEL registered broker-dealer.
770 Hodges
Lane OTHER DIRECTORSHIPS HELD: None
Strafford,
PA 19087
Birth date:
April 20,
1941

TRUSTEE

Began
serving:
September
2003
DR. PRINCIPAL OCCUPATIONS: Member, Catholic Hospital System; Chairman, Member, AAA Foundation $46,000
MARGUERITE for Traffic Safety; Chairman, AAA Foundation for Traffic Safety R&amp;D Committee; Vice Chairman,
D. NY State AAA; President; Buffalo Club Board.
HAMBLETON*
62 LaNoche PREVIOUS POSITIONS: Chairman, Federal Reserve Board (Buffalo Branch); Board Member,
Court Western New York Public Broadcasting; Trustee, Canisius College;
Buffalo, NY
14221 OTHER DIRECTORSHIPS HELD: None.
Birth date:
February 19,
1943

TRUSTEE

Began
Serving:
September
2005

OFFICERS

NAME TOTAL
ADDRESS COMPENSATION
BIRTH DATE FROM
POSITION PRINCIPAL OCCUPATIONS FOR PAST FIVE YEARS AND PREVIOUS POSITIONS TRUST**
WITH TRUST

CHARLES L. PRINCIPAL OCCUPATIONS: Director of Mutual Fund Services, Federated Services Company; Senior Vice $0
DAVIS President, Federated Securities Corp.; President, Edgewood Services, Inc. and President,
Federated Southpointe Distribution Services Inc.
Investors
Tower PREVIOUS POSITIONS: Director of Sales Administration, Federated Securities Corp., Director of
Pittsburgh, business Development, Federated Services Company; Business Manager, Mutual Fund Services,
PA Federated Services Company; Director of Investor Relations, MNC Financial, Inc.: and Vice
Birth date: President, Maryland National Bank.
March 23,
1960

CHIEF
EXECUTIVE
OFFICER

Began
serving:
December
2002
CARL W. PRINCIPAL OCCUPATIONS: Senior Vice President, M&amp;T Bank, 2001- Present; Administrative $0
JORDAN Vice President, M&amp;T Bank, 1995-2001.
One M&amp;T
Plaza
Buffalo, NY
Birth date:
January 2,
1955

PRESIDENT

Began
serving: May
2001
TODD E. PRINCIPAL OCCUPATIONS: Vice President, M&amp;T Bank, 2000-Present; Vice President, Director of $0
RICHARDS Mutual Fund Services, M&amp;T Securities, since January 2006.
100 East
Pratt Street PREVIOUS POSITIONS: President, Keystone Brokerage.
Baltimore,
MD
Birth date:
August 5,
1948

VICE
PRESIDENT

Began
serving:
March 2006
PHILIP R. PRINCIPAL OCCUPATIONS: Vice President, Director of Distribution for Proprietary Products, $0
CARBONE M&amp;T Securities, since 2003; Manager, Vision Shareholder Services and Discount Brokerage,
100 East 1998-2002.
Pratt
Street, 15th
Floor
Baltimore,
MD
Birth date:
July 27,
1954

VICE
PRESIDENT

Began
serving:
September
2003
SCOT A. PRINCIPAL OCCUPATIONS: Vice President, Product Manager, M&amp;T Securities, since 2002; $0
MILLEN Executive Associate, M&amp;T Investment Group, 2001-2002; Summer Associate, M&amp;T Investment Group,
100 East 2000.
Pratt
Street, 15th
floor
Baltimore,
MD
Birth date:
February 22,
1969

VICE
PRESIDENT

Began
serving:
September
2003
JUDY MACKIN PRINCIPAL OCCUPATIONS: Vice President, Mutual Fund Services Division, Federated Services $0
Federated Company.
Investors
Tower
Pittsburgh,
PA
Birth date:
May 30, 1960

VICE
PRESIDENT
AND
ASSISTANT
TREASURER

Began
serving:
March 2005
RICHARD N. PRINCIPAL OCCUPATIONS: Vice President, Federated Administrative Services. $0
PADDOCK
Federated
Investors
Tower
Pittsburgh,
PA
Birth date:
October 25,
1963

TREASURER,
PRINCIPAL
FINANCIAL
OFFICER

Began
serving:
December
2005
THOMAS R. PRINCIPAL OCCUPATIONS: Chief Compliance Officer, MTB Group of Funds, MTB Investment Advisor, Inc. $0
RUS and Zirkin-Cutler Investments, Inc.
100 East
Pratt PREVIOUS POSITIONS: Vice President and Associate Counsel, M&amp;T Bank 2003-2004; Vice President
Street, 17th and Trust Counsel, Allfirst Financial, Inc. 1995-2003.
Floor
Baltimore,
MD
Birth Date:
October 11,
1959

CHIEF
COMPLIANCE
OFFICER

Began
serving:
September
2004
STEVEN A. PRINCIPAL OCCUPATIONS: Compliance Officer, Federated Services Company, Federated Securities $0
FRIEDMAN Corp. and Edgewood Services, Inc.
Federated
Investors PREVIOUS POSITIONS: Senior Vice President, Compliance Officer and Bank Secrecy Act Officer,
Tower Parkvale Bank.
Pittsburgh,
PA
Birth Date:
May 12, 1950

AML
COMPLIANCE
OFFICER
Began
Serving:
December
2002
C. GRANT PRINCIPAL OCCUPATION: Counsel, Reed Smith LLP (since October 2002). $0
ANDERSON
Federated
Investors PREVIOUS POSITIONS: Corporate Counsel, Federated Investors, Inc.; Vice President,
Tower Federated Services Company (prior to October 2002).
Pittsburgh,
PA
Birth date:
November 6,
1940

SECRETARY

Began
serving:
December
2000
VICTOR R. PRINCIPAL OCCUPATIONS: Partner, Reed Smith LLP (since October 2002). $0
SICLARI
Federated PREVIOUS POSITIONS: Senior Corporate Counsel and Vice President, Federated Services
Investors Company (prior to October 2002).
Tower
Pittsburgh,
PA
Birth date:
November 17,
1961

ASSISTANT
SECRETARY

Began
serving: May
2000;
Secretary
from August
11, 1995 to
May 11,
2000;
Assistant
Secretary
from May 11,
2000 to
present.

**Officers do not receive any compensation from the Funds.
</R>

COMMITTEES OF THE BOARD

COMMITTEE COMMITTEE FUNCTIONS MEETINGS
BOARD MEMBERS HELD
COMMITTEE DURING
LAST
FISCAL
YEAR

EXECUTIVE Mark J. In between meetings of the full Board, the Executive Committee generally may exercise None
Czarnecki all the powers of the full Board in the management and direction of the business and
Daniel R. conduct of the affairs of the Trust in such manner as the Executive Committee shall
Gernatt, deem to be in the best interests of the Trust. However, the Executive Committee cannot
Jr. elect or remove Board members, increase or decrease the number of Trustees, elect or
Richard B. remove any Officer, declare dividends, issue shares or recommend to shareholders any
Seidel action requiring shareholder approval.
AUDIT Joseph J. The purposes of the Audit Committee are to oversee the accounting and financial Five
Castiglia reporting process of the Funds, the Funds' internal control over financial reporting,
William H. and the quality, integrity and independent audit of the Funds' financial statements.
Cowie, Jr. The Committee also oversees or assists the Board with the oversight of compliance with
John S. legal requirements relating to those matters, approves the engagement and reviews the
Cramer qualifications, independence and performance of the Funds' independent registered
Richard B. public accountants, acts as a liaison between the independent registered public
Seidel accountants and the Board and reviews the Funds' internal audit function.
NOMINATING Joseph J. The Nominating Committee, whose members consist of all independent Trustees, selects None
Castiglia and nominates persons for election to the Funds' Board when vacancies occur. The
William H. Committee will consider candidates recommended by shareholders, Independent Trustees,
Cowie, Jr. officers or employees of any of the Funds' agents or service providers and counsel to
Daniel R. the Funds. Any shareholder who desires to have an individual considered for nomination
Gernatt, by the Committee must submit a recommendation in writing to the Secretary of the Funds,
Jr. at the Funds' address appearing on the back cover of this Statement of Additional
John S. Information. The recommendation should include the name and address of both the
Cramer shareholder and the candidate and detailed information concerning the candidate's
Richard B. qualifications and experience. In identifying and evaluating candidates for
Seidel consideration, the Committee shall consider such factors as it deems appropriate. Those
Marguerite factors will ordinarily include: integrity, intelligence, collegiality, judgment,
D. diversity, skill, business and other experience, qualification as an "Independent
Hambleton Trustee," the existence of material relationships which may create the appearance of a
lack of independence, financial or accounting knowledge and experience, and dedication
and willingness to devote the time and attention necessary to fulfill Board
responsibilities.
<R>

</R>BOARD OWNERSHIP OF SHARES IN THE FUNDS AND IN THE TRUST AS OF DECEMBER 31,
2006

AGGREGATE
DOLLAR RANGE OF DOLLAR RANGE OF
SHARES OWNED SHARES OWNED IN
BOARD MEMBER NAME IN FUNDS THE TRUST*
MARK J. CZARNECKI Over $100,000
Conservative Growth Fund II None
Moderate Growth Fund II None
Aggressive Growth Fund II None
Large Cap Value Fund II None
Large Cap Growth Fund II None
JOSEPH J. CASTIGLIA Over $100,000
Conservative Growth Fund II None
Moderate Growth Fund II None
Aggressive Growth Fund II None
Large Cap Value Fund II None
Large Cap Growth Fund II None
WILLIAM H. COWIE, JR $50,001-$100,000
Conservative Growth Fund II None
Moderate Growth Fund II None
Aggressive Growth Fund II None
Large Cap Value Fund II None
Large Cap Growth Fund II None
JOHN S. CRAMER Over $100,000
Conservative Growth Fund II None
Moderate Growth Fund II None
Aggressive Growth Fund II None
Large Cap Value Fund II None
Large Cap Growth Fund II None
DANIEL R. GERNATT, JR. Over $100,000
Conservative Growth Fund II None
Moderate Growth Fund II None
Aggressive Growth Fund II None
Large Cap Value Fund II None
Large Cap Growth Fund II None
RICHARD B. SEIDEL $50,001-$100,000
Conservative Growth Fund II None
Moderate Growth Fund II None
Aggressive Growth Fund II None
Large Cap Value Fund II None
Large Cap Growth Fund II None
MARGUERITE D. HAMBLETON
Conservative Growth Fund II None None
Moderate Growth Fund II None
Aggressive Growth Fund II None
Large Cap Value Fund II None
Large Cap Growth Fund II None

*Aggregate Dollar Range of Shares owned in the Trust may include investments in
Funds of the Trust that are not offered in this Prospectus and SAI.

As of April 9, 2007, the Funds' board and officers as a group owned less than
1% of each fund's outstanding shares.

INVESTMENT ADVISOR

The Advisor conducts investment research and makes investment decisions for the
Funds.

The Advisor shall not be liable to the Trust or any Fund shareholder for any
losses that may be sustained in the purchase, holding, or sale of any security
or for anything done or omitted by it, except acts or omissions involving
willful misfeasance, bad faith, gross negligence, or reckless disregard of the
duties imposed upon it by its contract with the Trust.

SUB-ADVISOR
LARGE CAP VALUE FUND II

The Advisor has delegated daily management of the Large Cap Value Fund II to a
sub-advisor, NWQ. For its services under the Sub-Advisory Agreement, NWQ
Investment Management Company, LLC (NWQ), is entitled to receive an allocable
portion of the advisory fee that the Advisor receives from the Large Cap Value
Fund II. The allocation is based on the amount of the average daily net assets
that NWQ manages for the Fund. This fee is paid by the Advisor out of the fees
it receives from the Fund and is not a direct Fund expense. NWQ is entitled to
be paid a fee at the annual rate of 0.45% of the average daily net assets of the
Large Cap Value Fund II that it manages.

PORTFOLIO MANAGER INFORMATION
The following information about the Funds' Portfolio Managers is provided as of
the end of the Funds' most recently completed fiscal year.

<R>

THOMAS R. PIERCE

| |
| |
| TOTAL NUMBER OF OTHER|
|Other Accounts Managed by ACCOUNTS MANAGED/|
|Thomas R. Pierce TOTAL ASSETS*|
|Registered Investment Companies 3/$95,000,000|
|Other Pooled Investment Vehicles 0|
|Other Accounts** 660/$870,000,000|
* None of the Accounts has an advisory fee that is based on the performance of
the account.

**Portfolio Manager is a dual employee of MTBIA and M&amp;T Bank. All of the
"Other" accounts shown are accounts of the Trust Department of M&amp;T Bank.

Dollar value range of share owned in the Conservative Growth Fund II, Moderate
Growth Fund II and Aggressive Growth Fund II: none.

COMPENSATION STRUCTURE

Mr. Pierce's salary consists primarily of a base salary with a year-end bonus
based in part of Trust account maintenance, risk control/ adherence to process
management guidelines, and participation in Trust new business activities such
as the attraction of new accounts or the addition of assets to existing
accounts. No compensation besides a salary is received with respect to the
management of the Funds or any other mutual fund.

Mr. Pierce's performance is formally evaluated annually and based on a variety
of factors. Salary is based on job responsibilities in both the management of
Trust client assets and those deriving from the management of both the retail
and Variable Annuity Managed Allocation Funds. Bonus is based in part on Trust
accounts maintenance, risk control/ adherence to process management guidelines,
and participation in Trust new business-activities such as the attraction of new
account or the addition of assets to existing accounts. Deferred stock options
are awarded at year end based purely on the discretion of M&amp;T Bank senior
management.

MARK J. STEVENSON

| |
| |
| TOTAL NUMBER OF OTHER|
|Other Accounts Managed by ACCOUNTS MANAGED/|
|Mark J. Stevenson TOTAL ASSETS*|
|Registered Investment Companies 3/$95,000,000|
|Other Pooled Investment Vehicles 0|
|Other Accounts** 6823/$1,035,000,000|
* None of the Accounts has an advisory fee that is based on the performance of
the account.

**Portfolio Manager is a dual employee of MTBIA and M&amp;T Bank. All of the
"Other" accounts shown are accounts of the Trust Department of M&amp;T Bank.

Dollar value range of share owned in the Conservative Growth Fund II, Moderate
Growth Fund II and Aggressive Growth Fund II: none.

COMPENSATION STRUCTURE

Mr. Stevenson's salary consists primarily of a base salary with a year-end bonus
based in part of Trust account maintenance, risk control/ adherence to process
management guidelines, and participation in Trust new business activities such
as the attraction of new accounts or the addition of assets to existing
accounts. No compensation besides a salary is received with respect to the
management of the Funds or any other mutual fund.

Mr. Stevenson's performance is formally evaluated annually and based on a
variety of factors. Salary is based on job responsibilities in both the
management of Trust client assets and those deriving from the management of both
the retail and Variable Annuity Managed Allocation Funds. Bonus is based in
part on Trust accounts maintenance, risk control/ adherence to process
management guidelines, and participation in Trust new business-activities such
as the attraction of new account or the addition of assets to existing accounts.
Deferred stock options are awarded at year end based purely on the discretion of
M&amp;T Bank senior management.

ALLEN J. ASHCROFT

Dollar value range of share owned in the Large Cap Growth Fund II: none.

The portfolio manager's performance is formally evaluated annually and based on
a variety of factors. Mr. Ashcroft's compensation is based upon a base salary
and an annual incentive bonus. The fixed salary is based on the job description
of the position and overall qualifications of the individual. For the year
ended December 31, 2005, his bonus was based on the Fund's performance and how
his stock selection fared in this and other portfolios, in the sectors which he
covers as an analyst (Energy, Consumer Staples), relative to relevant
benchmarks.

The performance portion of Mr. Ashcroft's bonus is based on the time weighted
rates of return for the funds he manages compared to the S&amp;P 500/ Citigroup
Growth Index with the heaviest emphasis on current year results. Prior period
results are a factor to the extent that they build an argument for additional
compensation based on a superior long term track record.

<R>

</R>BYRON J. GRIMES

Dollar value range of share owned in the Large Cap Growth Fund II: none.

COMPENSATION STRUCTURE

The portfolio manager's performance is formally evaluated annually and based on
a variety of factors. Mr. Grimes' compensation is comprised of a base salary
and an annual incentive bonus. The base salary is based on the job description
of the position and the overall qualifications of the individual The bonus
determined by three components: the overall performance of M&amp;T Bank; the
overall performance of MTBIA relative to budget; and his investment performance
relative to the S&amp;P 500/Citigroup Growth Index, the benchmark for all of the
funds that he manages. In addition, as the Manager Director of Equity Portfolio
Management, a component of his incentive bonus is based on the overall
investment performance of the team that reports to him, relative to relevant
benchmarks. The bonus can be paid in cash and/or stock options in M&amp;T Bank
Corporation.

The performance portion of Mr. Grimes' incentive bonus is based on the time
weighted rates of return for the funds he manages compared to the S&amp;P
500/Citigroup Growth Index with the heaviest emphasis on the current year
results. Prior period results are a factor to the extent that they build an
argument for additional compensation based on a superior long-term track record.

CONFLICTS OF INTEREST

Actual or apparent conflicts of interest may arise when a portfolio manager has
day-to-day management responsibilities with respect to more than one account.
More specifically, portfolio managers who manage multiple accounts are presented
with the following potential conflicts:

{circle}The management of multiple accounts may result in a portfolio manager
devoting unequal time and attention to the management of each account.
MTBIA seeks to manage such competing interests for the time and attention
of portfolio managers by having portfolio managers focus on a particular
investment discipline. Most accounts managed by a portfolio manager in a
particular investment strategy are managed using the same investment
models.

{circle}If a portfolio manager identifies a limited investment opportunity
which may be suitable for more than one account, an account may not be
able to take full advantage of that opportunity due to an allocation of
filled purchase or sale orders across all eligible accounts. To deal with
these situations, MTBIA has adopted procedures for allocating portfolio
transactions across multiple accounts.

{circle}With respect to many of its clients' accounts, MTBIA determines which
broker to use to execute transaction orders, consistent with its duty to
seek best execution of the transaction. However, with respect to certain
other accounts, MTBIA may be limited by the client with respect to the
selection of brokers or may be instructed to direct trades through a
particular broker. In these cases, MTBIA may place separate, non-
simultaneous, transactions for a Fund and other accounts, which may
temporarily affect the market price of the security or the execution of
the transaction, or both, to the detriment of the Fund or the other
accounts.

{circle}The Fund is subject to different regulation than the other pooled
investment vehicles and other accounts managed by the portfolio manager.
As a consequence of this difference in regulatory requirements, the Fund
may not be permitted to engage in all the investment techniques or
transactions or to engage in these transactions to the same extent as the
other accounts managed by the portfolio manager. Finally, the appearance
of a conflict of interest may arise where MTBIA has an incentive, such as
a performance-based management fee, which MTBIA may charge in the future
to some accounts, with respect to which a portfolio manager has day-to-day
management responsibilities.

MTBIA has adopted certain compliance procedures which are designed to address
these types of conflicts. However, there is no guarantee that such procedures
will detect each and every situation in which a conflict arises.

See also the "Advisor Potential Conflict" section in the Prospectus regarding
the conflicts of interest in managing the Managed Allocation Funds.

NWQ INVESTMENT MANAGEMENT COMPANY, LLC
JON D. BOSSE, CFA*

TOTAL NUMBER OF OTHER NUMBER OF OTHER ACCOUNTS
Other Accounts Managed by ACCOUNTS MANAGED/ MANAGED/TOTAL ASSETS
Jon D. Bosse, CFA TOTAL ASSETS* THAT ARE SUBJECT TO
PERFORMANCE FEES
Registered Investment 6/$2,098,044,747 0
Companies
Other Pooled Investment 9/$1,305,694,528 0
Vehicles
Other Accounts 49/$28,768,533,348 9/$901,385,604

*Mr. Bosse and Mr. Friedel co-manage many of NWQ's client accounts.

EDWARD C. FRIEDEL, CFA*

TOTAL NUMBER OF OTHER NUMBER OF OTHER ACCOUNTS
Other Accounts Managed ACCOUNTS MANAGED/ MANAGED/TOTAL ASSETS
by TOTAL ASSETS* THAT ARE SUBJECT TO
Edward C. Friedel, CFA PERFORMANCE FEES

Registered Investment 3/$239,055,277 0
Companies
Other Pooled Investment 8/$1,102,207,286 0
Vehicles
Other Accounts 43,659/$23,988,308,259 2/$525,095,291

*Mr. Bosse and Mr. Friedel co-manage many of NWQ's client accounts.

COMPENSATION STRUCTURE

NWQ's portfolio managers participate in a highly competitive compensation
structure with the purpose of attracting and retaining the most talented
investment professionals and rewarding them through a total compensation program
as determined by the firm's executive committee. The total compensation program
consists of both a base salary and an annual bonus that can be a multiple of the
base salary. The portfolio manager's performance is formally evaluated annually
and based on a variety of factors. Bonus compensation is primarily a function of
the firm's overall annual profitability and the individual portfolio manager's
contribution as measured by the overall investment performance of client
portfolios in the strategy they manage relative to the strategy's general
benchmark for one, three and five year periods (as applicable), as well as an
objective review of stock recommendations and the quality of primary research,
and subjective review of the professional's contributions to portfolio strategy,
teamwork, collaboration and work ethic.

The total compensation package for portfolio managers includes an equity-like
incentive for purchase (whose value is determined by various factors including
the increase in profitability of NWQ over time). Additionally, the portfolio
managers have been provided compensation in conjunction with signing long-term
employment agreements. NWQ is a subsidiary of Nuveen Investments, Inc., which
has augmented this incentive compensation annually through individual awards of
a stock option pool, as determined through a collaborative process between
Nuveen Investments and the NWQ executive committee.

As of December 31, 2006, NWQ had nine institutional accounts that have
investment management fees calculated in part on the performance of the account
versus a benchmark ("performance based fees accounts"). The performance based
fee accounts are managed identically to other institutional accounts within the
same strategy and there are no additional investment risks taken in conjunction
with this type of investment management fee. The portfolio manager who manages
these performance based fee accounts does not receive any additional
compensation from these accounts based on any performance fees received from
such accounts.

CONFLICTS OF INTEREST

{circle}The management of multiple accounts may result in a portfolio manager
devoting unequal time and attention to the management of each account. NWQ
seeks to manage such competing interests for the time and attention of
portfolio managers by having portfolio managers focus on a particular
investment discipline. Most accounts managed by a portfolio manager in a
particular investment strategy are managed using the same investment
models.

{circle}If a portfolio manager identifies a limited investment opportunity
which may be suitable for more than one account, an account may not be
able to take full advantage of that opportunity due to an allocation of
filled purchase or sale orders across all eligible accounts. To deal with
these situations, NWQ has adopted procedures for allocating portfolio
transactions across multiple accounts.

{circle}With respect to many of its clients' accounts, NWQ determines which
broker to use to execute transaction orders, consistent with its duty to
seek best execution of the transaction. However, with respect to certain
other accounts, NWQ may be limited by the client with respect to the
selection of brokers or may be instructed to direct trades through a
particular broker. In these cases, NWQ may place separate, non-
simultaneous, transactions for a Fund and other accounts which may
temporarily affect the market price of the security or the execution of
the transaction, or both, to the detriment of the Fund or the other
accounts.

{circle}The Fund is subject to different regulation than the other pooled
investment vehicles and other accounts managed by the portfolio manager.
As a consequence of this difference in regulatory requirements, the Fund
may not be permitted to engage in all the investment techniques or
transactions or to engage in these transactions to the same extent as the
other accounts managed by the portfolio manager. Finally, the appearance
of a conflict of interest may arise where NWQ has an incentive, such as a
performance-based management fee, which relates to the management of some
accounts, with respect to which a portfolio manager has day-to-day
management responsibilities.

NWQ has adopted certain compliance procedures which are designed to address
these types of conflicts. However, there is no guarantee that such procedures
will detect each and every situation in which a conflict arises.

</R>

CODE OF ETHICS RESTRICTIONS ON PERSONAL TRADING
As required by SEC rules, the Funds, their Advisor, Subadvisor and Distributor
have adopted codes of ethics. These codes govern securities trading activities
of investment personnel, Trustees, and certain other employees. Although they do
permit these people to trade in securities, including those that the Funds could
buy, they also contain significant safeguards designed to protect the Funds and
their shareholders from abuses in this area, such as requirements to obtain
prior approval for, and to report, particular transactions.

VOTING PROXIES ON FUND PORTFOLIO SECURITIES

The Board has delegated to the Advisor authority to vote proxies on the
securities held in the Fund's portfolio. The Board has also approved the
Advisor's policies and procedures for voting the proxies, which are set forth in
their entirety below.

MTB INVESTMENT ADVISORS, INC. PROXY VOTING POLICY

INTRODUCTION
MTB Investment Advisors, Inc. acknowledges that among its duties as a fiduciary
to its clients is the obligation to protect the interests of its clients by
voting the shares held by its clients' accounts. In order to ensure that shares
are voted in all appropriate circumstances, Adviser will exercise voting
discretion as to all shares unless voting discretion is specifically reserved
for the client or assigned to a third party in the advisory contract. To ensure
that shares are voted in a consistent manner and in the best interest of its
clients, Adviser has adopted this Proxy Voting Policy.

GENERAL STANDARDS AND APPROACH
Each year, the Adviser receives hundreds of proxy solicitations with respect to
voting securities held in client accounts. The matters to be voted upon may be
proposals of management or of stockholders, and cover a diverse assortment of
complex issues. Whether the interests of shareholders are best served by a vote
"for" or "against" a proposal often depends upon the context, the effects that
adoption could have on the company's business, and the motivations of the
parties making the proposal. These determinations require a considerable
investment of time, resources and expertise.

Given the sheer volume of proxies, and the broad spectrum of issues to be voted
upon, the proxy voting process represents a considerable administrative burden.
In order to efficiently discharge its duty to vote proxies, Adviser has engaged
a third party, Institutional Shareholder Services, Inc. ("ISS") to perform the
function of analyzing and providing recommendations on voting proxies.

ISS is the acknowledged industry leader in assisting institutional shareholders
with the types of proxy analysis described above. Adviser has reviewed the
policies and considerations applied by ISS in voting proxies and found them to
be fully consistent with the policies of Adviser. Accordingly, Adviser will
generally follow the ISS recommendations in voting proxies. Summaries of the
ISS proxy voting policies and considerations are available at the ISS website at
http://www.issproxy.com/pdf/US2006SummaryGuidelines.pdf.

In general, Adviser believes that it is in the best interests of its clients to
vote its clients' shares so as to promote the alignment of the interests of
corporate management with the interests of its shareholders, to improve the
accountability of corporate management to its shareholders, to reward good
performance by management, and to approve proposals that Adviser believes will
result in financial rewards for its clients.

Adviser reserves the right to override any ISS-recommended voting policy when it
believes that a vote contrary to a policy would be in the best interest of
Adviser's clients. Any vote contrary to a stated
policy must be approved by the Trade Management Oversight Committee of the
Adviser's Board of Directors, or that Committee's designee. A written summary
of the considerations in making the voting decision should be prepared and
retained with the records of the proxy.

Adviser believes that addressing its proxy voting obligations as described in
this Proxy Voting Policy will promote the best interests of shareholders, and
therefore, will be in the best interests of Adviser's clients.

CONFLICTS OF INTEREST
Adviser may have a conflict of interest in voting a particular proxy. A
conflict of interest could arise, for example, as a result of a business
relationship with a company, or a direct or indirect business interest in the
matter being voted upon, or as a result of a personal relationship with
corporate directors or candidates for directorships. Whether a relationship
creates a material conflict of interest will depend upon the facts and
circumstances.

The Trade Management Oversight Committee has reviewed a copy of the ISS
policies, procedures and practices regarding potential conflicts of interest
that could arise in ISS proxy voting services to Adviser as result of business
conducted by ISS. The Trade Management Oversight
Committee believes that the policies, procedures and practices followed by ISS
minimize the potential conflicts of interest by ISS in making voting
recommendations to Adviser.

Whenever a portfolio manager determines that it is in a client's best interest
to vote on a particular proposal in a manner other than in accordance with the
guidelines set forth in this Proxy Voting Policy, or the policy does not address
how to vote on the proposal, the portfolio manager shall present the matter to
the Trade Management Oversight Committee, which shall be responsible for
evaluating information relating to conflicts of interest in connection with the
voting of the client proxy.

For purposes of identifying conflicts under this policy, the Trade Management
Oversight Committee will rely on publicly available information about a company
and its affiliates, information about the company and its affiliates that is
generally known by employees of Adviser, and other information actually known by
a member of the Trade Management Oversight Committee.

In the event that the Trade Management Oversight Committee determines that
Adviser has a material conflict of interest with respect to a proxy proposal,
then Adviser shall either:

1. Vote on the proposal in accordance with the recommendation of the Trade
Management Oversight Committee or that committee's designee;

2. Prior to voting on the proposal, either:

(i) Contact an independent third party (such as another plan fiduciary) to
recommend how to vote on the proposal and will vote in accordance with the
recommendation of such third party (or have the third party vote such proxy); or

(ii) Fully disclose the nature of the conflict to the client(s), and obtain the
client's consent as to how Adviser will vote on the proposal (or otherwise
obtain instructions from the client as to how the proxy on the proposal should
be voted).

Adviser may not address a material conflict of interest by abstaining from
voting, unless the Trade Management Oversight Committee (or that committee's
designee) has determined that not voting the proxy is in the best interest of a
client. However, as indicated above, there
may be other circumstances where Adviser determines that refraining from voting
a proxy is in the client's best interest and the existence of a material
conflict of interest shall not affect such a determination.

The Trade Management Oversight Committee shall document the manner in which
proxies involving a material conflict of interest have been voted by Adviser as
well as the basis for any determination that Adviser does not have a material
conflict of interest in respect of a particular matter.

<R>

APPOINTMENT OF SUBADVISERS
From time to time Adviser may recommend that a client (e.g., the Funds) appoint
a subadviser with respect to a particular investment mandate. By recommending
the subadviser to manage the client's investments, the Adviser is also
recommending that the client approve the subadviser's policies and procedures
with respect to proxy voting. Among other things, Adviser will require that a
subadviser's policies and procedures are designed to ensure that proxies are
voted in what the subadviser believes to be the best interests of clients, and
that conflicts are disclosed, documented, and otherwise addressed in an
appropriate manner. In considering a subadviser to recommend, the Adviser will
seek assurance that the subadviser will generally vote proxies in a manner that
is consistent with MTBIA's policy (i.e. in accordance with ISS recommendations,
unless otherwise specified by MTBIA). Subadviser will provide Adviser with
information on securities voted by subadviser promptly after the vote occurs.
If a subadviser proposes to cast a vote that is not consistent with MTBIA
policy, the subadviser must notify the Adviser prior to casting the vote, so
that Adviser can seek to avoid conflicting votes among accounts that it manages.
Subadviser must also document the rationale for any such inconsistent vote.

</R>

PROXY VOTING REPORT
A report on "Form N-PX" of how the Funds voted any such proxies during the most
recent 12-month period ended June 30 is available without charge on the SEC
website at http://www.sec.gov and through the Trust's website. Go to
www.mtbfunds.com; select "Proxy Voting Record" to access the link to Form N-PX.

PORTFOLIO HOLDINGS INFORMATION
The disclosure policy of the Funds and the Advisor prohibits the disclosure of
portfolio holdings information to any investor or intermediary before the same
information is made available to other investors. Employees of the Advisor or
its affiliates who have access to nonpublic information concerning the Fund's
portfolio holdings are prohibited from trading securities on the basis of this
information. Such persons must report all personal securities trades and obtain
pre-clearance for all personal securities trades other than mutual fund shares.

Firms that provide administrative, custody, financial, accounting, legal or
other services to the Funds may receive nonpublic information about Fund
portfolio holdings for purposes relating to their services. All of these
service providers are identified elsewhere in the Prospectus or SAI. The Funds
may also provide portfolio holdings information to publications that rate, rank
or otherwise categorize investment companies. These organizations are CDA
Weisenberger and Lipper. Traders or portfolio managers may provide "interest"
lists to facilitate portfolio trading if the list reflects only that subset of
the portfolio for which the trader or portfolio manager is seeking market
interest. A list of service providers, publications and other third parties who
may receive nonpublic portfolio holdings information appears in the Appendix to
this SAI.

The furnishing of nonpublic portfolio holdings information to any third party
(other than authorized governmental or regulatory personnel) requires the prior
approval of the President of the Advisor and of the Chief Compliance Officer of
the Funds. The President of the Advisor and the Chief Compliance Officer will
approve the furnishing of nonpublic portfolio holdings information to a third
party and will be given only if there is a legitimate business purpose and such
disclosure is subject to a confidentiality agreement to safeguard the
confidentiality of the information so that the information will be used only for
the purposes for which it was furnished and otherwise protect against misuse of
such information. In that regard, and to address possible conflicts between the
interests of Fund shareholders and those of the Advisor and its affiliates, the
following procedures apply. No consideration may be received by the Funds, the
Advisor, any affiliate of the Advisor or any of their employees in connection
with the disclosure of portfolio holdings information. Persons approved to
receive nonpublic portfolio holdings information will receive it as often as
necessary for the purpose for which it is provided. Such information may be
furnished as frequently as daily and often with no time lag between the date of
the information and the date it is furnished. The Board receives and reviews
annually a list of the persons who receive nonpublic portfolio holdings
information and the purposes for which it is furnished.

BROKERAGE TRANSACTIONS
When selecting brokers and dealers to handle the purchase and sale of portfolio
instruments, the Advisor and subadvisor look for prompt execution of the order
at a favorable price. The Advisor and sub-advisor will generally use those who
are recognized dealers in specific portfolio instruments, except when a better
price and execution of the order can be obtained elsewhere. The Advisor and sub-
advisor may select brokers and dealers based on whether they also offer research
services (as described below). The Advisor and sub-advisor make decisions on
portfolio transactions and select brokers and dealers subject to review by the
Funds' Board.

Investment decisions for the Funds are made independently from those of other
accounts managed by the Advisor. When the Funds and one or more of those
accounts invests in, or disposes of, the same security, available investments or
opportunities for sales will be allocated among the Funds and the account(s) in
a manner believed by the Advisor to be equitable. While the coordination and
ability to participate in volume transactions may benefit the Funds, it is
possible that this procedure could adversely impact the price paid or received
and/or the position obtained or disposed of by the Funds.

RESEARCH SERVICES
Subject to future regulatory changes of the SEC, research services may include
advice as to the advisability of investing in securities; security analysis and
reports; economic studies; industry studies; receipt of quotations for portfolio
evaluations; and similar services. Research services may be used by the Advisor
or by affiliates of the sub-advisor in advising other accounts. To the extent
that receipt of these services may replace services for which the Advisor, or
their affiliates might otherwise have paid, it would tend to reduce their
expenses. The Advisor and their affiliates exercise reasonable business judgment
in selecting those brokers who offer brokerage and research services to execute
securities transactions. They determine in good faith that commissions charged
by such persons are reasonable in relationship to the value of the brokerage and
research services provided.

CO-ADMINISTRATORS, TRANSFER AGENT AND DIVIDEND DISBURSING AGENT

Federated Services Company (FSC) and M&amp;T Securities, Inc. serve as co-
administrators to the Trust and provide the Funds with certain administrative
personnel and services necessary to operate the Funds. During the period October
1, 2002 through September 30, 2005, administrative services were provided at the
following rates:

Fees Payable to FSC:

MAXIMUM ADMINISTRATIVE FEE AVERAGE AGGREGATE DAILY NET ASSETS OF THE MTB GROUP
OF FUNDS

0.06% on the first $2 billion
0.03% on the next $3 billion
0.02% on the next $2 billion
0.0125% on the next $3 billion
0.01% on assets in excess of $10 billion

Fees Payable to M&amp;T Securities, Inc.:

MAXIMUM ADMINISTRATIVE FEE AVERAGE AGGREGATE DAILY NET ASSETS OF THE MTB GROUP
OF FUNDS

0.04% on the first $5 billion
0.03% on the next $2 billion
0.0175% on the next $3 billion
0.015% on assets in excess of $10 billion

Effective October 1, 2005, the administrative fees payable to FSC have been
changed to reflect the following:

Fees Payable to FSC:

MAXIMUM ADMINISTRATIVE FEE AVERAGE AGGREGATE DAILY NET ASSETS OF THE MTB GROUP
OF FUNDS

0.04% on the first $2 billion
0.03% on the next $2 billion
0.02% on the next $3 billion
0.0125% on the next $3 billion
0.010% on assets in excess of $10 billion

There has been no change to the fees payable to co-administrator, M&amp;T
Securities, Inc.

From time to time, FSC and its affiliates may pay out of their reasonable
profits and other resources advertising, marketing and other expenses for the
benefit of the Funds, and such amounts may be paid to the Advisor and its
affiliates.

Prior to July 1, 2004, FSC, through its affiliates, Federated Shareholder
Services Company (FSSC), a registered transfer agent, served as transfer and
dividend disbursing agent to the Trust, and received a separate fee from the
Fund for these transfer agency services. Boston Financial Data Services, Inc.
(BFDS) replaced FSSC as transfer agent to the Trust on July 1, 2004. the
principal business address of BFDS is 2 Heritage Drive, North Quincy, MA 02171.

Boston Financial Data services, Inc. (BFDS) serves as transfer and dividend
disbursing agent to the Trust, and received a separate fee from the Funds for
these transfer agency services. The principal business address of BFDS is 2
Heritage Drive, North Quincy, MA 02171.

CUSTODIAN AND FUND ACCOUNTANT

State Street Bank and Trust Company, Boston, Massachusetts, is custodian for the
securities and cash of the Funds. Foreign instruments purchased by a Fund are
held by foreign banks participating in a global custody network coordinated by
State Street Bank. State Street Bank and Trust Company also provides financial
administration and fund accounting services to the Funds at the following annual
fee, based on the Funds' average monthly net assets:

ANNUAL FEE, BILLED AND AVERAGE MONTHLY NET ASSETS OF THE MTB GROUP OF FUNDS
PAYABLE MONTHLY
-----------------------------------------------------------------------------
0.037% on the first $5 billion
-----------------------------------------------------------------------------
0.034% on the next $5 billion
-----------------------------------------------------------------------------
0.0315% on the next $10 billion
-----------------------------------------------------------------------------
0.029% on assets in excess of $20 billion
-----------------------------------------------------------------------------
In addition, for an annual fee of $4,000 per Fund, State Street Bank and Trust
Company prepares two quarterly portfolio listings per year for inclusion in Form
N-Q and prepares tabular or graphic presentations of the Funds' portfolio
holdings and an enhanced expense disclosure example for inclusion in shareholder
reports.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The independent registered public accounting firm for the Funds, Ernst &amp;
Young LLP conducts its audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States), which require it to plan and
perform its audits to provide reasonable assurance about whether the Funds'
financial statements and financial highlights are free of material misstatement.

<R>

FEES PAID BY THE FUNDS FOR SERVICES

ADVISORY FEE PAID/ BROKERAGE ADMINISTRATIVE FEE PAID/
ADVISORY FEE WAIVED COMMISSIONS PAID ADMINISTRATIVE FEE WAIVED

FUNDS FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
FISCAL YEAR FISCAL YEAR FISCAL YEAR FISCAL YEAR FISCAL YEAR FISCAL YEAR FISCAL YEAR FISCAL YEAR FISCAL YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
2006 2005 2004 2006 2005 2004 2006 2005 2004
MODERATE $116,718/ $109,075/ $79,041 -- $0 $0 $27,522/$0 $27,978/0 $20,165/0
GROWTH FUND $43,122 $31,492 /14,247
II*
LARGE CAP $49,941/ $39,168/ $26,639 $2,238 $2,240 $9,118 $4,204/$0 $3,583/0 $2,426/0
VALUE FUND $49,941 $39,168 /$26,639
II**
LARGE CAP $43,457/ $41,627/ $29,304 $6,339 $7,605 $5,502 $3,014/$0 $3,141/0 $2,199/0
GROWTH FUND $43,457 $41,627 /$29,304
II***
AGGRESSIVE $2,117/ -- -- -- -- -- $499/$0 -- --
GROWTH FUND $2,117
II*
CONSERVATIVE $1,589/ -- -- -- -- -- $374/$0 -- --
GROWTH FUND $1,589
II*

* Start of performance dates: Moderate Growth Fund II- June 17,2002; Large Cap
Value Fund II- May 31, 2002; Large Cap Growth Fund II-May 31, 2002; Aggressive
Growth Fund II-May 3, 2005; Conservative Growth Fund II - May 3, 2005.

**Effective December 8, 2004, the Advisor delegated daily management of Large
Cap Value Fund II to NWQ Investment Management Company LLC as subadvisor.

***Prior to December 8, 2004, the Advisor delegated daily management of the
Large Cap Growth Fund II to Montag &amp; Caldwell, Inc. as subadvisor.

</R>

<R>

12B-1 AND SHAREHOLDER SERVICES FEES

FUNDS 12B-1 12B-1 SHAREHOLDER SHAREHOLDER
FEES FEES SERVICES SERVICES
PAID WAIVED FEE PAID FEE WAIVED
Moderate Growth Fund II $116,718 0 $46,687 0
Large Cap Value Fund II $17,836 0 $7,135 0
Large Cap Growth Fund II $12,773 0 $5,109 0
Aggressive Growth Fund II $2,117 0 $847 0
Conservative Growth Fund II $1,589 0 $636 0

</R>

HOW DO THE FUNDS MEASURE PERFORMANCE?

The Funds may advertise Share performance by using the SEC's standard method for
calculating performance applicable to all mutual funds. The SEC also permits
this standard performance information to be accompanied by non-standard
performance information.

Share performance reflects the effect of non-recurring charges, such as maximum
sales charges, which, if excluded, would increase the total return and yield.
The performance of Shares depends upon such variables as: portfolio quality;
average portfolio maturity; type and value of portfolio securities; changes in
interest rates; changes or differences in a Fund's or any class of Shares'
expenses; and various other factors. Share performance does not reflect any
charges and expenses that would be imposed under a variable insurance product
contract. Were the effect of such charges to be included, Share performance
would be lower.

Share performance fluctuates on a daily basis largely because net earnings
fluctuate daily. Both net earnings and offering price per Share are factors in
the computation of yield and total return.

TOTAL RETURN
Total return represents the change (expressed as a percentage) in the value of
Shares over a specific period of time, and includes the investment of income and
capital gains distributions.

The average annual total return for Shares is the average compounded rate of
return for a given period that would equate a $10,000 initial investment to the
ending redeemable value of that investment. The ending redeemable value is
computed by multiplying the number of Shares owned at the end of the period by
the NAV per Share at the end of the period. The number of Shares owned at the
end of the period is based on the number of Shares purchased at the beginning of
the period with $10,000, less any applicable sales charge, adjusted over the
period by any additional Shares, assuming the annual reinvestment of all
dividends and distributions.

When Shares of a Fund are in existence for less than a year, the Funds may
advertise cumulative total return for that specific period of time, rather than
annualizing the total return.

YIELD
The yield of Shares of the Funds is calculated by dividing: (i) the net
investment income per Share earned by the Shares over a 30-day period; by (ii)
the maximum offering price per Share on the last day of the period. This number
is then annualized using semi-annual compounding. This means that the amount of
income generated during the 30-day period is assumed to be generated each month
over a 12-month period and is reinvested every six months.

To the extent investment professionals and broker/dealers charge fees in
connection with services provided in conjunction with an investment in Shares,
the Share performance is lower for shareholders paying those fees.

AVERAGE ANNUAL TOTAL RETURNS AND YIELD

The information presented in the following table uses the SEC's standard method
for calculating performance. Total Return is given for the period ended
December 31, 2006. Yield is given for the 30-day period ended December 31,
2006.

-------------------------------------------------------------------
|MODERATE GROWTH FUND II|30-DAY PERIOD|1 YEAR|START OF PERFORMANCE|
-------------------------------------------------------------------
|TOTAL RETURN | | | |
-------------------------------------------------------------------
|Before Taxes | N/A |10.42%| 6.48% |
-------------------------------------------------------------------
|YIELD | 1.49% | N/A | N/A |
-------------------------------------------------------------------

-------------------------------------------------------------------
|LARGE CAP VALUE FUND II|30-DAY PERIOD|1 YEAR|START OF PERFORMANCE|
-------------------------------------------------------------------
|TOTAL RETURN | | | |
-------------------------------------------------------------------
|Before Taxes | N/A |17.61%| 8.67% |
-------------------------------------------------------------------
|YIELD | 0.94% | N/A | N/A |
-------------------------------------------------------------------

--------------------------------------------------------------------
|LARGE CAP GROWTH FUND II|30-DAY PERIOD|1 YEAR|START OF PERFORMANCE|
--------------------------------------------------------------------
|TOTAL RETURN | | | |
--------------------------------------------------------------------
|Before Taxes | N/A |10.34%| 3.28% |
--------------------------------------------------------------------
|YIELD | 0.42% | N/A | N/A |
--------------------------------------------------------------------

---------------------------------------------------------------------
|AGGRESSIVE GROWTH FUND II|30-DAY PERIOD|1 YEAR|START OF PERFORMANCE|
---------------------------------------------------------------------
|TOTAL RETURN | | | |
-----------------------------------------
|Before Taxes | N/A |14.83%| 13.91% |
-----------------------------------------
|YIELD | 0.58% | N/A | N/A |
---------------------------------------------------------------------

-----------------------------------------------------------------------
|CONSERVATIVE GROWTH FUND II|30-DAY PERIOD|1 YEAR|START OF PERFORMANCE|
-----------------------------------------------------------------------
|TOTAL RETURN | | | |
-------------------------------------------
|Before Taxes | N/A |6.96% | 6.13% |
-------------------------------------------
|YIELD | 2.55% | N/A | N/A |
-----------------------------------------------------------------------
*Start of performance for Large Cap Growth Fund II and Large Cap Value Fund II
was May 31, 2002; start of performance for Moderate Growth Fund II was June 17,
2002; start of performance for Aggressive Growth Fund II and Conservative Growth
Fund II was May 3, 2005.

FINANCIAL INFORMATION

The Financial Statements for the Funds for the fiscal year ended December 31,
2006 are incorporated by reference to the Annual Report to Shareholders of the
MTB Group of Funds dated December 31, 2006.

INVESTMENT RATINGS

STANDARD AND POOR'S

LONG-TERM DEBT RATING DEFINITIONS

AAA--Debt rated AAA has the highest rating assigned by Standard &amp;amp;
Poor's. Capacity to pay interest and repay principal is extremely strong.

AA--Debt rated AA has a very strong capacity to pay interest and repay principal
and differs from the higher-rated issues only in small degree.

A--Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher-rated categories.

BBB--Debt rated BBB is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher-rated categories.

BB--Debt rated BB has less near-term vulnerability to default than other
speculative issues. 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 payments. The BB
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied BBB rating.

B--Debt rated B has a greater vulnerability to default but currently has the
capacity to meet interest payments and principal repayments. Adverse business,
financial, or economic conditions will likely impair capacity or willingness to
pay interest and repay principal. The B rating category is also used for debt
subordinated to senior debt that is assigned an actual or implied BB or BB-
rating.

CCC--Debt rated CCC has a currently identifiable vulnerability to default, and
is dependent upon favorable business, financial, and economic conditions to meet
timely payment of interest and repayment 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 CCC rating category is also
used for debt subordinated to senior debt that is assigned an actual or implied
B or B rating.

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

C--The rating C typically is applied to debt subordinated to senior debt which
is assigned an actual or implied CCC debt rating. The C rating may be used to
cover a situation where a bankruptcy petition has been filed, but debt service
payments are continued.

COMMERCIAL PAPER (CP) RATINGS
An S&amp;P commercial paper rating is a current assessment of the likelihood of
timely payment of debt having an original maturity of no more than 365 days.

A-1--This highest category indicates that the degree of safety regarding timely
payment is strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus sign (+) designation.

A-2--Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated A-1.

SHORT-TERM MUNICIPAL OBLIGATION RATINGS

A Standard &amp;amp; Poor's (S&amp;P) note rating reflects the liquidity
concerns and market access risks unique to notes.

SP-1--Very strong or strong capacity to pay principal and interest. Those issues
determined to possess overwhelming safety characteristics will be given a plus
sign (+) designation.

SP-2--Satisfactory capacity to pay principal and interest.

VARIABLE RATE DEMAND NOTES (VRDNS) AND TENDER OPTION BONDS (TOBS) RATINGS

S&amp;P assigns dual ratings to all long-term debt issues that have as part of
their provisions a variable rate demand feature. The first rating (long-term
rating) addresses the likelihood of repayment of principal and interest when
due, and the second rating (short-term rating) describes the demand
characteristics. Several examples are AAA/A-1+, AA/A-1+, A/A-1. (The definitions
for the long- term and the short-term ratings are provided below.)

MOODY'S INVESTORS SERVICE, INC.

LONG-TERM BOND RATING DEFINITIONS
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
edged. 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.

AA--Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group, they comprise what are generally 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.

A--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.

BA--Bonds which are 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 thereby not well safeguarded during
both good and bad times over the future. Uncertainty of position characterizes
bonds in this class.

B--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.

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

C--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.

COMMERCIAL PAPER RATINGS
P-1--Issuers rated Prime-1 (or related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations. Prime-1 repayment
capacity will normally be evidenced by the following characteristics: leading
market positions in well established industries, high rates of return on funds
employed, conservative capitalization structure with moderate reliance on debt
and ample asset protection, broad margins in earning coverage of fixed financial
charges and high internal cash generation, well-established access to a range of
financial markets and assured sources of alternate liquidity.

P-2--Issuers rated Prime-2 (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will normally
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.

SHORT-TERM MUNICIPAL OBLIGATION RATINGS
Moody's Investor Service, Inc. (Moody's) short-term ratings are designated
Moody's Investment Grade (MIG or VMIG). (See below.) The purpose of the MIG or
VMIG ratings is to provide investors with a simple system by which the relative
investment qualities of short-term obligations may be evaluated.

MIG1--This designation denotes best quality. There is present strong protection
by established cash flows, superior liquidity support or demonstrated broad
based access to the market for refinancing.

MIG2--This designation denotes high quality. Margins of protection are ample
although not so large as in the preceding group.

VARIABLE RATE DEMAND NOTES (VRDNS) AND TENDER OPTION BONDS (TOBS) RATINGS
Short-term ratings on issues with demand features are differentiated by the use
of the VMIG symbol to reflect such characteristics as payment upon periodic
demand rather than fixed maturity dates and payment relying on external
liquidity. In this case, two ratings are usually assigned, (for example,
Aaa/VMIG-1); the first representing an evaluation of the degree of risk
associated with scheduled principal and interest payments, and the second
representing an evaluation of the degree of risk associated with the demand
feature. The VMIG rating can be assigned a 1 or 2 designation using the same
definitions described above for the MIG rating.

FITCH IBCA, INC./FITCH INVESTORS SERVICE, L.P.

LONG-TERM DEBT RATING DEFINITIONS
AAA--Bonds 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.

AA--Bonds 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+.

A--Bonds 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 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 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.

BB--Bonds 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.

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

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

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

SHORT-TERM DEBT RATING DEFINITIONS
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 for 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 payment, but the margin of safety is not as great as for
issues assigned F-1+ and F-1 ratings.

COMMERCIAL PAPER RATING DEFINITIONS
FITCH-1--(Highest Grade) Commercial paper assigned this rating is regarded as
having the strongest degree of assurance for timely payment.

FITCH-2--(Very Good Grade) Issues assigned this rating reflect an assurance of
timely payment only slightly less in degree than the strongest issues.

LONG-TERM DEBT RATINGS
NR--Indicates that both the bonds and the obligor or credit enhancer are not
currently rated by S&amp;P or Moody's with respect to short-term indebtedness.
However, management considers them to be of comparable quality to securities
rated A-1 or P-1.

NR(1)--The underlying issuer/obligor/guarantor has other outstanding debt rated
AAA by S&amp;P or Aaa by Moody's.

NR(2)--The underlying issuer/obligor/guarantor has other outstanding debt rated
AA by S&amp;P or Aa by Moody's.

NR(3)--The underlying issuer/obligor/guarantor has other outstanding debt rated
A by S&amp;P or Moody's.

OTHER CONSIDERATIONS

Among the factors considered by Moody's in assigning bond, note and commercial
paper ratings are the following: (i) evaluation of the management of the issuer;
(ii) economic evaluation of the issuer's industry or industries and an appraisal
of speculative-type risks which may be inherent in certain areas; (iii)
evaluation of the issuer's products in relation to competition and customer
acceptance; (iv) liquidity; (v) amount and quality of long-term debt; (vi) trend
of earnings over a period of 10 years; (vii) financial strength of a parent
company and the relationships which exist with the issuer; and (viii)
recognition by management of obligations which may be present or may arise as a
result of public interest questions and preparations to meet such obligations.

Among the factors considered by S&amp;P in assigning bond, note and commercial
paper ratings are the following: (i) trend of earnings and cash flow with
allowances made for unusual circumstances, (ii) stability of the issuer's
industry, (iii) the issuer's relative strength and position within the industry
and (iv) the reliability and quality of management.

ADDRESSES

MTB MANAGED ALLOCATION FUND - CONSERVATIVE GROWTH II

MTB MANAGED ALLOCATION FUND - MODERATE GROWTH II

MTB MANAGED ALLOCATION FUND - AGGRESSIVE GROWTH II

MTB LARGE CAP VALUE FUND II

MTB LARGE CAP GROWTH FUND II

DISTRIBUTOR
Edgewood Services, Inc.
5800 Corporate Drive
Pittsburgh, PA 15237-5829

INVESTMENT ADVISOR
MTB Investment Advisors, Inc.
100 East Pratt Street
17th Floor
Baltimore, MD 21202

SUB-ADVISOR TO MTB LARGE CAP VALUE FUND II
NWQ Investment Management Company, LLC
2049 Century Park East
16th Floor
Los Angeles, CA 90067

CO-ADMINISTRATOR
M&amp;T Securities, Inc.
One M&amp;T Plaza
Buffalo, NY 14203

CO-ADMINISTRATOR
Federated Services Company
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

TRANSFER AGENT AND DIVIDEND DISBURSING AGENT
Boston Financial Data Services, Inc.
2 Heritage Drive
North Quincy, MA 02171

CUSTODIAN AND FUND ACCOUNTANT
State Street Bank and Trust Company
P.O. Box 8609
Boston, MA 02266-8609

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Ernst &amp; Young LLP
200 Clarendon Street
Boston, MA 02116-5072

APPENDIX

The following is a list of persons other than the Advisor and its affiliates
that may receive nonpublic portfolio holdings information concerning the Funds:

CUSTODIAN, FUND ACCOUNT AND SECURITIES LENDING AGENT
State Street Bank and Trust Company

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Ernst &amp; Young LLP

LEGAL COUNSEL
Dickstein Shapiro LLP

SERVICE PROVIDERS
Evaluation Associates LLC
Wiesenberger

SECURITY PRICING SERVICES
Reuters
Thomson/LX
JJ Kenney
FT Interactive Data
Bloomberg
FRI Corporation

RATINGS AGENCIES
Not applicable

PERFORMANCE REPORTING/PUBLICATIONS
Thomson Financial/ Vestek (Evaluation Associates)
ICI
RR Donnelly
Lipper
Standard &amp; Poor's
Hartford Life
Morningstar
Bloomberg
Vickers

TRANSFER AGENT
Boston Financial Data Services, Inc.

INSURANCE COMPANIES
<R>

The Hartford Life Insurance Company

Nationwide Life Insurance Company and Nationwide Life
and Annuity Insurance Company

TransAmerica Life Insurance Company and TransAmerica
Financial Life Insurance Company

AIG SunAmerica Life Insurance Company

First SunAmerica Life Insurance Company

</R>

OTHER
Reed Smith LLP

PART C. OTHER INFORMATION.
Item 23. Exhibits
(a) (i) Conformed copy of Amended and
Restated Agreement and Declaration
of Trust of MTB Group of Funds, a
Delaware Statutory Trust; (41)
(ii) Conformed copy of Amendment to
Certificate of Trust of MTB Group
of Funds, a Delaware Statutory
Trust; (38)
(b) (i) Copy of Amended and Restated By-
Laws of MTB Group of Funds, a
Delaware Statutory Trust; (38)
(ii) Copy of Amendment #1 to the
Amended and Restated By-Laws of
MTB Group of Funds; (41)
(iii) Copy of Amendment #2 to the
Amended and Restated By-Laws of
MTB Group of Funds; (44)
(c) (i) Copy of Specimen Certificate for
Shares of Capital Stock of the
Registrant; (8)
(ii) Copy of Specimen Certificate for
Shares of Capital Stock of the
Vision Capital Appreciation Fund;
(15)
(d) (i) Conformed copy of Investment
Advisory Agreement of the
Registrant (27 funds) dated August
22, 2003; (39)
(ii) Conformed copy of Investment
Advisory Agreement of the
Registrant (2 money market funds)
dated August 22, 2003; (39)
(iii) Conformed copy of Investment
Advisory Agreement of the
Registrant (5 funds)dated August
22, 2003; (39)
(iv) Conformed copy of Sub-Advisory
Agreement for the MTB Small Cap
Stock Fund (Mazama Capital
Management, Inc.), dated August
22, 2003; (39)
(v) Conformed copy of Sub-Advisory
Agreement for MTB Small Cap Stock
Fund (LSV Asset Management), dated
August 22, 2003; (39)
(vi) Conformed copy of Sub-Advisory
Agreement for MTB International
Equity Fund (UBS Global Asset
Management), dated August 22,
2003; (39)
(vii) Conformed copy of Amendment
to Sub-Advisory Agreement for MTB Small Cap
Stock Fund (Mazama Capital Management,
Inc.); (39)
(viii) Conformed copy of Amendment
to Sub-Advisory Agreement for MTB Small Cap
Stock Fund (LSV Asset Management); (39)
(viv) Conformed copy of Amendment
to Sub-Advisory Agreement for MTB
International Equity Fund (UBS Global
Asset Management (Americas), Inc.); (39)
(ix) Conformed copy of Investment
Advisory Contract Letter
Agreement, dated April 1, 2004; (39)
(x) Conformed copy of Amendment to
Subadvisory Agreement among MTB
Group of Funds, MTB Investment
Advisors, Inc. and Independence
Investment LLC; (41)
(xi) Conformed copy of Sub-Advisory Agreement
for MTB Large Cap Value Fund and
MTB Large Cap Value Fund II (NWQ
Investment Management Company,
LLC) dated December 8, 2004; (42)
(xii) Conformed copy of Sub-Advisory Agreement
for MTB Equity Income Fund
(DePrince, Race & Zollo, Inc.)
dated December 8, 2004; (42)
(xiii) Conformed copy of Investment
Advisory Contract Letter
Agreement, dated February 15,
2005 (Variable Annuity Funds); (44)
(xiv) Conformed copy of Sub-Advisory Agreement
For the Mid Cap Stock Fund (LSV Asset
Management), dated December 8, 2004;(49)
(xv) Conformed copy of Investment Sub-
Advisory Contract Letter
Agreement for the Small Cap Fund,
date December 8, 2004; (43)
(xvi) Conformed copy of Schedule A to the
Investment Advisory Agreement of
the Registrant (27 funds) dated
August 22, 2003; (43)
(xvii) Conformed copy of Investment
Advisory Agreement of the
Registrant (2 money market funds)
dated August 22, 2003; (43)
(xviii) Conformed copy of Schedule A to
the Investment Advisory Agreement
of the Registrant (2 money market
funds); (44)
(xix) Conformed copy of Schedule A to the
Investment Advisory Agreement of
the Registrant (27 funds); (49)
(xx) Conformed copy of Investment Advisory
Contract Letter Agreement, dated
January 6, 2006 (Maryland and
Virginia Municipal Bond Funds); (47)
(xxi) Conformed copy of Investment Advisory
Contract Letter Agreement, dated
March 24, 2006 (Variable Annuity Funds); (47)
(xxii) Conformed copy of Subadvisory
Agreement for International
Equity Fund (LSV Asset
Management) dated October 24, 2005; (48)
(xxiii) Conformed copy of Subadvisory
Agreement for International
Equity Fund (SSgA Funds
Management, Inc.) dated October 24, 2005; (48)
(xxiv) Conformed copy of Subadvisory
Agreement for International
Equity Fund (Hansberger Global
Investors, Inc.) dated October 24, 2005; (48)
(xxv) Conformed copy of Sub-Advisory Agreement
for Large Cap Value Fund and
Large Cap Value Fund II (NWQ
Investment Management Company,
LLC) dated July 28, 2005; (49)
(xxvi) Conformed copy of Amendment to
Subadvisory Contract among MTB
Group of Funds, MTB Investment
Advisors, Inc. and LSV Asset
Management; (50)
(xxvii) Conformed copy of Subadvisory
Agreement for Balanced Fund
(DePrince, Race & Zollo, Inc.); (50)
(xxviii) Conformed copy of Subadvisory
Agreement for Small Cap Stock
Fund (Copper Rock Capital
Partners);(50)
(xxix) Conformed copy of Subadvisory
Agreement for International
Equity Fund (Hansberger Global
Investors, Inc.); +
(e) (i) Conformed copy of Distributor's
Contract of the Registrant, dated
August 15, 2003; (39)
(ii) Conformed copy of Amendment to
Distributor's Contract (September
22, 2003); (39)
(iii) Conformed copy of Amendment #1 to
Exhibit B to the Distributor's
Contract; (43)
(iv) Conformed copy of Amendment #2 to
Exhibit B to the Distributor's
Contract; (47)
(f) Not applicable;
(g) (i) Conformed copy of Custodian
Agreement of the Registrant, dated
December 7, 2004
And Copy of Schedules A-D to
the Custodian Agreement of the
Registrant; (42)
(ii) Conformed copy of Custody, Fund
Accounting and Fund Administration
Fee Schedule; (40)
(iii) Conformed copy of Securities Lending
Authorization Agreement between
MTB Group of Funds and State
Street Bank & Trust Company; (41)
(iv) Copy of Appendix A to the Custodian
Agreement between the Registrant
and State Street Bank, dated April
29, 2005; (47)
(v) Conformed copy of Funds Transfer
Addendum to the Custodian
Contract; (44)
(h) (i) Copy of Recordkeeping Agreement of
the Registrant; (43)
(ii) Copy of Recordkeeping Agreement of
the Registrant for the VA Funds;
(43)
(iii) Conformed copy of Agreement for
Administrative Services and
Transfer Agency Services between
the Registrant and Federated
Services Company, dated November
1, 2000; (43)
(iv) Conformed copy of Financial
Administration and Accounting
Services Agreement between
Registrant and State Street Bank
and Trust Company, dated November
8, 2000; (43)
(v) Conformed copy of Shareholder
Services Agreement of the
Registrant, dated November 8,
2000; (43)
(vi) Conformed copy of Shareholder
Services Plan, dated November 1,
2000; (43)
(vii) Conformed copy of Shareholder
Services Plan for the VA Funds,
dated February 22, 2005; (43)
(viii) Conformed copy of Participation
Agreement of the Registrant,
including Exhibits A-E; (36)
(vi) Conformed copy of
Indemnification Agreement of
the Registrant; (36)
(vii) Conformed copy of Service
Mark License Agreement; (39)
(viii) Conformed copy of Assignment
and Consent of Fund
Participation Agreement; (40)
(ix) Conformed copy of
Participation Agreement among MTB Group
of Funds, Edgewood Services, Inc.,
MTB Investment Advisors, Inc.,
TransAmerica Life Insurance Co. and
TransAmerica Financial Life
Insurance Co.; (41)
(x) Conformed copy of
Participation Agreement among MTB Group
of Funds, Edgewood Services, Inc.,
MTB Investment Advisors, Inc.,
and Hartford Life Insurance Company,
dated May 1, 2004, including
Schedules A-E;(42)
(xi) Copy of Mutual Fund Sales and
Services Agreement of the
Registrant; (49)
(xii) Conformed copy of Transfer
Agency and Services Agreement between the
Registrant and Boston Financial Data
Services, Inc., dated October 1, 2005; (49)
(xiii) Conformed copy of Agreement
for Administrative Services between the
Registrant and Manufacturers and Traders
Trust Company; (43)
(xiv) Conformed copy of Amendment
No. 1 to Schedules A and C of the
Participation Agreement with Transamerica
Life Insurances Co. and Transamerica
Financial Life Insurance Co.; (43)
(xv) Conformed copy of Amendment
#9 to the Agreement for
Administrative Services and
Transfer Agency Services
Between the Registrant and
Federated Services Company; (44)
(xvi) Conformed copy of Amended and
Restated Financial
Administration and Accounting
Services Agreement between
the Registrant and State
Street Bank and Trust
Company; (43)
(xvii) Conformed copy of Assignment
of Contracts between
Federated Services Company
and State Street Bank and
Trust Company; (44)
(xviii) Copy of Exhibit 1 to the
Agreement for Administrative Services
[and Transfer Agency Services] with
Federated Services Company, dated
January 11, 2006;(47)
(xix) Conformed Copy of Amendment
10 to Agreement for Administrative
Services [and Transfer Agency Services];(47)
(xx) Conformed Copy of Exhibit A to
Shareholder Services Plan, dated
January 11, 2006;(47)
(xxi) Copy of Exhibit A to Shareholder
Services Agreement, dated January
11, 2006;(47)
(xxii) Copy of Exhibit 1 to the
Administrative Services Agreement,
dated January 11, 2006;(47)
(xxiii) Conformed copy of Amendment 5 to
Agreement for Administrative
Services; (47)
(xxiv) Copy of Restatement and Amendments
1 and 2 to Exhibit A to the
Shareholder Services Agreement;
(49)
(xxv) Copy of Restatement and Amendments
1 and 2 to Exhibit A to the
Shareholder Services Plan; (49)
(xxvi) Conformed copy of Amendment to
Amended and Restated Financial
Administration and Accounting
Services Agreement; (49)
(xxvii) Conformed copy of Revised Exhibits
B and E to Fund Participation
Agreement (Nationwide); (49)
(xxviii) Conformed copy of Revised
Schedules A and C to Participation
Agreement (Hartford); (49)
(xxviv) Conformed copy of
Participation Agreement among
MTB Group of Funds, Edgewood
Services, Inc., MTB
Investment Advisors, Inc.,
and First SunAmerica Life
Insurance Company, dated February
1, 2007 including Schedule A-C;
(50)
(xxx) Conformed copy of Participation
Agreement among MTB Group of
Funds, Edgewood Services, Inc.,
MTB Investment Advisors, Inc. and
AIG SunAmerica Life Assurance
Company, dated February 1, 2007,
including Schedule A-C; (50)
(i) Conformed copy of Opinion and
Consent of Counsel as to legality
of shares being registered; (11)
(j) (i) Conformed copy of Consent of Ernst
& Young LLP, Independent
Registered Public Accounting Firm;
(+)
(ii) Conformed copy of Consent of Tait
Weller Baker LP, Independent
Registered Public Accounting Firm;
(49)
(k) Not applicable;
(l) Conformed copy of Initial Capital
Understanding; (11)
(m) (i) Conformed copy of Rule 12b-1
Agreement of the Registrant and
Edgewood Services, Inc.; (41)
(ii) Conformed copy of Rule 12b-1 Plan
regarding Class B Shares and Class
C Shares of the Registrant; (40)
(iii) Conformed copy of Rule 12b-1 Plan
(non-Class B Shares and Class C
Shares) of the Registrant; (49)
(iv) Copy of Dealer (Sales) Agreement; (7)
(v) Copy of Exhibit A to the Rule 12b-1 Plan; (47)
(vi) Conformed copy of Contract
Defining Responsibility for Fees
Under Non-Conforming Dealer
Agreement;(43)
(vii) Copy of Amendments 1-4 to Exhibit
A to the Rule 12b-1 Agreement; (49)
(n) (i) Conformed copy of Multiple Class
Plan of the Registrant, dated
March 24, 2003, including Exhibits A-I; (40)
(ii) Form of Restatement and Amendment #1
to Exhibit I to the Multiple Class Plan; (49)
(iii) Form of Exhibits J and K to the
Multiple Class Plan; (49)
(o) (i) Conformed copy of Power of
Attorney of the Registrant; (39)
(ii) Conformed copy of Power of
Attorney of Richard J. Thomas; (39)
(iii) Conformed copy of Power of
Attorney of Chairman and Trustee
Joseph J. Castiglia; (41)
(iv) Conformed copy of Power of Attorney of
Trustee Marguerite Hambleton; (45)
(v) Conformed copy of Power of Attorney of
Treasurer Richard N. Paddock; (48)
(p) (i) Copy of Code of Ethics for Access
Persons (Manufacturers and Traders
Trust Company); (36)
(ii) Copy of Code of Ethics of Vision
Group of Funds, Inc.; (29)
(iii) Copy of Montag & Caldwell, Inc.
Code of Ethics and Standards of
Practice; (36)
(iv) Copy of Independence Investment Associates,
Inc. and Subsidiaries Code of Ethics; (30)
(v) The Registrant hereby
incorporates, on behalf of the
Distributor, the conformed copy of
the Code of Ethics for Access
Persons from Item 23(p) of the
Federated Institutional Trust
Registration Statement on Form N-
1A filed with the Commission on
September 30, 2003 (File Nos. 33-
54445 and 811-7193).
(vi) Copy of Code of Ethics of UBS
Brinson/Brinson Partners, Inc.; (32)
(vii) Copy of Code of Ethics of LSV
Asset Management; (49)
(viii) Copy of Code of Ethics of Mazama
Capital Management, Inc. (34)
(ix) Copy of Code of Ethics Regarding
Personal Securities Trading - MTBIA. (49)
(x) Copy of Code of Ethics of Copper
Rock Capital Partners, LLC.; (50)

+ All exhibits have been filed electronically.
7. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 9 on Form N-1A filed June 17, 1993. (File Nos. 33-20673 and
811-5514)
8. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 11 on Form N-1A filed September 3, l993. (File Nos. 33-20673
and 811-5514)
11. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 19 on Form N-1A filed June 27, 1994. (File Nos. 33-20673 and
811-5514)
15. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 24 on Form N-1A filed December 20, 1996. (File Nos. 33-20673
and 811-5514)
29. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 41 on Form N-1A filed April 14, 2000, (File Nos. 33-20673 and
811-5514)
30. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 42 on Form N-1A filed June 28, 2000, (File Nos. 33-20673 and
811-5514)
32. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 45 on Form N-1A filed November 8, 2000, (File Nos. 33-20673
and 811-5514)
34. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 48 on Form N-1A filed August 27, 2001, (File Nos. 33-20673
and 811-5514)
36. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 54 on Form N-1A filed June 27, 2002 (File Nos. 33-20673 and
811-5514)
38. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 57 on Form N-1A filed August 22, 2003 (File Nos. 33-20673 and
811-5514)
39. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 59 on Form N-1A filed April 28, 2004 (File Nos. 33-20673 and
811-5514)
40. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 60 on Form N-1A filed July 1, 2004 (File Nos. 33-20673 and
811-5514)
41. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 61 on Form N-1A filed August 27, 2004 (File Nos. 33-20673 and
811-5514)
42. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 62 on Form N-1A filed February 11, 2005 (File Nos. 33-20673
and 811-5514)
43. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 63 on Form N-1A filed April 28, 2005 (File Nos. 33-20673 and
811-5514)
44. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 65 on Form N-1A filed August 29, 2005 (File Nos. 33-20673 and
811-5514)
45. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 66 on Form N-1A filed October 7, 2005 (File Nos. 33-20673 and
811-5514)
47. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 68 on Form N-1A filed April 27, 2006 (File Nos. 33-20673 and
811-5514)
48. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 69 on Form N-1A filed June 29, 2006 (File Nos. 33-20673 and
811-5514)
49. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 70 on Form N-1A filed August 29, 2006 (File Nos. 33-20673 and
811-5514)
50. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 69 on Form N-1A filed March 1, 2007 (File Nos. 33-20673 and
811-5514)

Item 24. Persons Controlled by or Under Common Control with
Registrant:
None

Item 25. Indemnification:

Indemnification is provided to Officers and Trustees of the Registrant pursuant
to Article VII of Registrant's Amended and Restated Agreement and Declaration of
Trust. The Investment Advisory Contract provides that, in the absence of willful
misfeasance, bad faith, gross negligence, or reckless disregard of the
obligations or duties under the Investment Advisory Contract on the part of
Adviser, Adviser shall not be liable to the Registrant or to any shareholder for
any act or omission in the course of or connected in any way with rendering
services or for any losses that may be sustained in the purchase, holding, or
sale of any security. Registrant's Trustees and Officers are covered by an
Investment Trust Errors and Omissions Policy.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to Trustees, Officers, and controlling persons of the
Registrant by the Registrant pursuant to the Declaration of Trust or otherwise,
the Registrant is aware that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Act and, therefore, is unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by Trustees, Officers, or controlling
persons of the Registrant in connection with the successful defense of any act,
suit, or proceeding) is asserted by such Trustees, Officers, or controlling
persons in connection with the shares 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 the Act and
will be governed by the final adjudication of such issues.

Insofar as indemnification for liabilities may be permitted pursuant to Section
17 of the Investment Company Act of 1940 for Trustees, Officers, and controlling
persons of the Registrant by the Registrant pursuant to the Declaration of Trust
or otherwise, the Registrant is aware of the position of the Securities and
Exchange Commission as set forth in Investment Company Act Release No. IC-11330.
Therefore, the Registrant undertakes that in addition to complying with the
applicable provisions of the Declaration of Trust or otherwise, in the absence
of a final decision on the merits by a court or other body before which the
proceeding was brought, that an indemnification payment will not be made unless
in the absence of such a decision, a reasonable determination based upon factual
review has been made (i) by a majority vote of a quorum of non-party Trustees
who are not interested persons of the Registrant or (ii) by independent legal
counsel in a written opinion that the indemnitee was not liable for an act of
willful misfeasance, bad faith, gross negligence, or reckless disregard of
duties. The Registrant further undertakes that advancement of expenses incurred
in the defense of a proceeding (upon undertaking for repayment unless it is
ultimately determined that indemnification is appropriate) against an Officer,
Trustee, or controlling person of the Registrant will not be made absent the
fulfillment of at least one of the following conditions: (i) the indemnitee
provides security for his undertaking; (ii) the Registrant is insured against
losses arising by reason of any lawful advances; or (iii) a majority of a quorum
of disinterested non-party Trustees or independent legal counsel in a written
opinion makes a factual determination that there is reason to believe the
indemnitee will be entitled to indemnification.
<R>

</R>

<R>
</R>
Item 26. Business and Other Connections of Investment
Adviser:

(a) MTB Investment Advisors, Inc., (MTBIA), a subsidiary
of Manufacturers and Traders Trust Company ("M&T
Bank") performs investment advisory services for the
Registrant. As of June 30, 2006, MTBIA and entities
affiliated with MTBIA or its predecessors managed
approximately $5.6 billion in money market mutual fund
assets and $2.8 billion in net assets of fluctuating
mutual funds. M&T Bank is the principal banking
subsidiary of M&T Bank Corporation, a $56.5 billion
bank holding company as of June 30, 2006,
headquartered in Buffalo, New York. As of December
31, 2005, M&T Bank had over 650 offices throughout New
York State, Maryland, Delaware, Virginia, West
Virginia, Pennsylvania, and Washington, D.C., and an
office in the Cayman Islands, British West Indies.

M&T Bank was founded in 1856 and provides
comprehensive banking and financial services to
individuals, governmental entities and businesses
throughout its footprint. As of June 30, 2006, M&T
Bank had over $56.5 billion in assets. Except for MTB
Group of Funds, M&T Bank does not presently provide
investment advisory services to any other registered
investment companies.

The principal executive Officers and the Directors of
MTBIA are set forth in the following tables. Unless
otherwise noted, the position listed under Other
Substantial Business, Profession, Vocation or
Employment is with MTBIA.

(b)
Other Substantial
Position with Business, Profession,
Name MTBIA Vocation or Employment
<R>
</R>
Mark J. Czarnecki Director Executive Vice President
One M&T Plaza, M&T Bank Corporation and
19th Floor Manufacturers and
Buffalo, NY 14203-2399 Traders Trust Company

William F. Dwyer Director Senior Vice President
100 E. Pratt Street Manufacturers and Traders
17th Floor Trust Company
Baltimore, MD 21202-1009

Carl W. Jordan Director Senior Vice President
One M&T Plaza, Manufacturers and Traders
9th Floor Trust Company
Buffalo, NY 14203-2399

Kenneth G. Thompson Director Group Vice President
100 E. Pratt Street Manufacturers and Traders
15th Floor Trust Company
Baltimore, MD 21202-1009

Item 27. Principal Underwriters:

(a) Edgewood Services, Inc. the Distributor for shares of
the Registrant, acts as principal underwriter for the
following open-end investment companies, including
the Registrant: BBH Fund, Inc., BBH Trust, The
Huntington Funds, MTB Group of Funds and WesMark
Funds.

(b)

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant

Charles L. Davis, Jr. President,
5800 Corporate Drive Edgewood Services, Inc. --
Pittsburgh, PA 15237-7002

Thomas R. Donahue Director and Executive --
5800 Corporate Drive Vice President,
Pittsburgh, PA 15237-7002 Edgewood Services, Inc.

Peter J. Germain Director, --
5800 Corporate Drive Edgewood Services, Inc.
Pittsburgh, PA 15237-7002

Thomas E. Territ Director,
5800 Corporate Drive Edgewood Services, Inc.
Pittsburgh, PA 15237-7002

Denis McAuley II Director and Treasurer --
5800 Corporate Drive Edgewood Services, Inc.
Pittsburgh, PA 15237-7002

C. Todd Gibson Secretary, --
5800 Corporate Drive Edgewood Services, Inc.
Pittsburgh, PA 15237-7002

Lori A. Hensler Assistant Treasurer,
5800 Corporate Drive Edgewood Services, Inc.
Pittsburgh, PA 15237-7002

Richard A. Novak Assistant Treasurer,
5800 Corporate Drive Edgewood Services, Inc.
Pittsburgh, PA 15237-7002

Edward C. Bartley Assistant Secretary,
5800 Corporate Drive Edgewood Services, Inc.
Pittsburgh, PA 15237-7002

Item 28. Location of Accounts and Records:

All accounts and records required to be maintained by Section 31(a) of
the Investment Company Act of 1940 and Rules 31a-1 through 31a-3
promulgated thereunder are maintained at one of the following locations:

MTB Group of Funds Reed Smith LLP
Investment Management Group (IMG)
Federated Investors Tower
12th Floor
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779
(Notices should be sent to the
Agent for Service at the above address)

5800 Corporate Drive,
Pittsburgh, Pennsylvania 15237-7010

Boston Financial Data 2 Heritage Drive
Services, Inc. North Quincy, Massachusetts 02171
("Transfer Agent, Dividend
Disbursing Agent")

Federated Services Company Federated Investors Tower
("Co-Administrator") 1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779

M&T Securities, Inc. One M&T Plaza
("Co-Administrator") Buffalo, New York 14240

MTB Investment Advisors,Inc., 100 E. Pratt Street, 17th Floor
a subsidiary of Baltimore, MD 21202
Manufacturers and Traders
Trust Company ("Adviser")

LSV Asset Management One North Wacker Drive
("Sub-Adviser" to the MTB Suite 4000
Small Cap Stock Fund, Chicago, Illinois 60606
the MTB Mid Cap Stock Fund
and the International Equity
Fund)

Mazama Capital Management, Inc. One SW Columbia Street
("Sub-Adviser" to the MTB Suite 1860
Small Cap Stock Fund) Portland, OR 97258

NWQ Investment Management 2049 Century Park East, 16th floor
Company, LLC Los Angeles, California 90067
("Sub-Adviser" to the MTB
Large Cap Value Fund and the
MTB Large Cap Value Fund II)

Hansberger Global 401 East Los Olas Blvd.
Investors, Inc. ("Sub-Adviser" Suite 1700
to the MTB International Equity Fort Lauderdale, FL 33301
Fund)

SSgA Funds Management, Inc. State Street Financial Center
("Sub-Adviser" to the MTB One Lincoln Street
International Equity Fund) Boston, MA 0211-2900

DePrince, Race & Zollo, Inc. 250 Park Avenue South
("Sub-Adviser" to the MTB Suite 250
Equity Income Fund) Winter Park, Florida 32789

State Street Bank P.O. Box 8609
and Trust Company("Custodian") Boston, Massachusetts 02266-8609

Item 29. Management Services: Not applicable.

Item 30. Undertakings:

Registrant hereby undertakes to comply with the provisions
of Section 16(c) of the 1940 Act with respect to the removal
of Trustees/Directors and the calling of special shareholder
meetings by shareholders.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, MTB GROUP OF FUNDS,
certifies that it meets all of the requirements for effectiveness of
this Amendment to its Registration Statement pursuant to Rule 485(b)
under the Securities Act of 1933 and has duly caused this Amendment
to its Registration Statement to be signed on its behalf by the
undersigned, duly authorized, in the City of Pittsburgh and
Commonwealth of Pennsylvania, on the 26th day of April, 2007.

MTB GROUP OF FUNDS

BY: /s/ C. Grant Anderson
C. Grant Anderson, Secretary
April 26, 2007

Pursuant to the requirements of the Securities Act of 1933, this
Amendment to its Registration Statement has been signed below by the
following person in the capacity and on the date indicated:

NAME TITLE DATE

By: /s/ C. Grant Anderson
C. Grant Anderson Attorney In Fact April 26, 2007
SECRETARY For the Persons
Listed Below

NAME TITLE

Joseph J. Castiglia* Chairman of the Board and Trustee

Charles L. Davis, Jr.* Chief Executive Officer
(Principal Executive Officer)

Carl W. Jordan* President

Richard N. Paddock* Treasurer
(Principal Financial Officer)

William H. Cowie, Jr.* Trustee

John S. Cramer* Trustee

Mark J. Czarnecki* Trustee

Daniel R. Gernatt, Jr.* Trustee

Richard B. Seidel* Trustee

Dr. Marguerite D. Hambleton* Trustee

* By Power of Attorney