-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VtbJ+E8Olgava2GqppqRAAdrXceY6WFKlu5fSNZuWxZqcb1F+mrWtn76ZrHVBMuG 9WiP62PAJ3EbjTNGxRFoKQ== 0001016843-99-001161.txt : 19991118 0001016843-99-001161.hdr.sgml : 19991118 ACCESSION NUMBER: 0001016843-99-001161 CONFORMED SUBMISSION TYPE: 497 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19991117 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HERITAGE SERIES TRUST CENTRAL INDEX KEY: 0000897111 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 497 SEC ACT: SEC FILE NUMBER: 033-57986 FILM NUMBER: 99759678 BUSINESS ADDRESS: STREET 1: 880 CARILLON PARKWAY CITY: ST PETERSBURG STATE: FL ZIP: 33716 BUSINESS PHONE: 8135733800 497 1 Heritage Series Trust [PHOTO MONTAGE] From Our Family to Yours: The Intelligent Creation of Wealth. Technology Fund PROSPECTUS October 11, 1999 These securities have not been approved or disapproved by the Securities and Exchange Commission nor has the Commission passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. [LOGO] Series Trust(TM) 880 Carillon Parkway St. Petersburg, Florida 33716 (800) 421-4184 TABLE OF CONTENTS - ---------------------------------------------------------------------------- - ---------------------------------------------------------------------------- DETAILS OF THE FUND .................................................. 1 Investment Objective ................................................ 1 How the Technology Fund Pursues its Objective ....................... 1 What are the Main Risks of Investing in the Technology Fund ......... 1 Who is the Portfolio Manager ........................................ 2 What are the Costs of Investing in the Technology Fund .............. 2 Expense Example ..................................................... 3 MANAGEMENT OF THE FUND ............................................... 4 Who Manages Your Fund ............................................... 4 Distribution of Fund Shares ......................................... 4 Year 2000 ........................................................... 4 YOUR INVESTMENT ...................................................... 5 Before You Invest ................................................... 5 Choosing a Class of Shares .......................................... 5 Sales Charge Reductions and Waivers ................................. 7 How to Invest ....................................................... 8 How to Sell Your Investment ......................................... 9 How to Exchange Your Shares ......................................... 11 Account and Transaction Policies .................................... 11 Dividends, Capital Gains and Taxes .................................. 12 Prospectus DETAILS OF THE FUND TECHNOLOGY FUND - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- INVESTMENT OBJECTIVE. The Technology Fund seeks long-term capital appreciation. HOW THE TECHNOLOGY FUND PURSUES ITS OBJECTIVE. The Technology Fund seeks to achieve its objective by investing primarily in equity securities of companies that rely extensively on technology in their processes, products or services, or may be expected to benefit from technological advances and improvements in industry, manufacturing and commerce. Special emphasis may be given to companies employing innovative technology to enhance distribution systems, develop new products and increase management efficiencies. The fund invests in various technology subsectors, including personal computer hardware and software, enterprise hardware and software, data networking, telecommunications, Internet and electronic commerce, semiconductors, semiconductor equipment, computer/business services, contract manufacturing and component distribution. The fund's portfolio manager will use a "bottom-up" method of analysis based on fundamental research to select companies for the fund's portfolio. In selecting investments, the fund's portfolio manager will search for companies, regardless of size, whose stocks appear to be trading below their true value. The Fund also will invest in companies that are positioned for accelerated growth or higher earnings. The portfolio manager may sell any security in the fund's portfolio if the company's fundamentals deteriorate, the competitive landscape of the company or its industry changes, the company's position size in the fund's portfolio becomes too large, or new investments are more attractive. The fund will invest, under normal market conditions, at least 65% of its total assets in equity securities of companies that rely extensively on technology in their processes, products or services, or may be expected to benefit from technological advances and improvements in industry, manufacturing and commerce. Equity securities include common and preferred stocks, warrants or rights exercisable into common or preferred stock, securities convertible into common or preferred stock, and American Depository Receipts. As a temporary defensive measure because of market, economic or other conditions, the fund may invest up to 100% of its assets in high-quality, short-term debt instruments. To the extent that the fund invokes this strategy, its ability to achieve its investment objective may be affected adversely. WHAT ARE THE MAIN COMPONENTS OF THE RISKS OF INVESTING IN THE TECHNOLOGY FUND. Perhaps the biggest risk of investing in this fund is that its returns will fluctuate and you could lose money. This fund invests primarily in the equity securities of companies whose value might decrease in response to the activities of the company that issued the securities, general market conditions, and/or economic conditions If this occurs, the fund's net asset value also may decrease. INVESTING IN A SINGLE SECTOR. The fund concentrates its investments in the technology sector. As a result, the fund's investments likely will be sensitive to sector-wide conditions. Adverse conditions or developments affecting one technology subsector may spread to other companies within related technology subsectors. The market prices of companies within these subsectors may move in tandem, which may cause greater volatility on the fund's net asset value and performance than on a fund that invests among different and unrelated sectors. INVESTING IN TECHNOLOGY COMPANIES. Investments in technology companies present special and significant risks. For example, if technology continues to advance at an accelerated rate, and the number of companies and product offerings continues to expand, increasingly aggressive pricing may affect the profitability of companies in which the fund invests. In addition, because of the rapid pace of technological development, products and services produced by companies in which the fund invests may become obsolete or have relatively short product cycles. As a result the fund's returns may be considerably more volatile than the returns of other mutual funds that do not invest in similarly related companies. Prospectus 1 INVESTING IN SMALL-CAP COMPANIES. The fund may invest a portion of its assets in small-capitalization technology companies. Small cap companies often have narrower markets and more limited managerial and financial resources than larger, more established companies. As a result, their performance can be more volatile and they face greater risk of business failure, which could increase the volatility of the fund's portfolio. Generally, the smaller the company size, the greater these risks. INTEREST RATE RISK. A rising interest rate environment tends to negatively affect companies in the technology sector. Those technology companies having high market valuations may appear less attractive to investors which may cause sharp decreases in the companies' market prices. Further, those technology companies seeking to finance their expansion would have increased borrowing costs which may negatively impact their earnings. In addition, a rise in interest rates typically will cause the market value of any fixed-income securities held by the fund to fall. Consequently, in a rising interest rate environment, the fund's performance may be reduced. INVESTING IN ILLIQUID SECURITIES. Because technology securities may be volatile, there is the possbility that the technology securities in which the fund invests may become illiquid. Illiquid securities may trade at a discount when compared to more liquid investments. The fund may be unable to sell illiquid securities in a timely manner or at a fair price due to the lack of liquidity. In addition, the sale of such securities may require more time and increased selling expenses. Consequently, the fund's investments in illiquid securities may have an adverse impact on its net asset value. NON-DIVERSIFICATION RISK. The fund is non-diversified which means it invests in a limited number of companies. Consequently, the performance of any one company may have a substantial impact on the fund's performance. In addition, the fund's net asset value may fluctuate more than a fund investing in a larger number of companies. PORTFOLIO TURNOVER. The fund may engage in short-term transactions under various market conditions to a greater extent than certain other mutual funds with similar investment objectives. The portfolio manager expects that the fund's portfolio turnover will exceed 200%. The fund's turnover rate may vary greatly from year to year or during periods within a year. A high rate of portfolio turnover generally leads to greater transaction costs and may result in additional tax consequences to investors. WHO IS THE PORTFOLIO MANAGER. Duane Eatherly, CFA, a Senior Research Analyst of the fund's subadviser Eagle Asset Management, Inc., is responsible for the day-to-day management of the fund. WHAT ARE THE COSTS OF INVESTING IN THE TECHNOLOGY FUND. The tables below describe the fees and expenses that you may pay if you buy and hold shares of the fund. The fund's expenses are based on estimated expenses to be incurred for the fiscal year ending October 31, 2000.
SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT): CLASS A CLASS B CLASS C ------- ------- ------- Maximum Sales Charge Imposed on Purchases (as a % of offering price) ......... 4.75% None None Maximum Deferred Sales Charge (as a % of original purchase price or redemption proceeds, whichever is lower) ............................................... None/triangle/ 5%* 1%** Wire Redemption Fee (per transaction) ........................................ $5.00 $5.00 $5.00
/triangle/ If you buy $1,000,000 or more of Class A shares and sell these shares within 18 months from the date of purchase, you may pay a 1% contingent deferred sales charge at the time of sale. * Declining over a six-year period as follows: 5% during the first year, 4% during the second year, 3% during the third and fourth years, 2% during the fifth year, 1% during the sixth year and 0% thereafter. Class B shares will convert to Class A shares eight years after purchase. ** Declining to 0% at the first year. Prospectus 2 ANNUAL FUND OPERATING EXPENSES (EXPENSES DEDUCTED FROM FUND ASSETS): CLASS A CLASS B CLASS C ------- ------- ------- Management Fees* ................................. 1.00% 1.00% 1.00% Distribution and Service (12b-1) Fees ............ 0.25% 1.00% 1.00% Other Expenses ................................... 0.71% 0.71% 0.71% ----- ----- ----- Total Annual Fund Operating Expenses ............. 1.96% 2.71% 2.71% Fee Waiver and/or Expense Reimbursement* ......... 0.31% 0.31% 0.31% ----- ----- ----- Net Expenses ..................................... 1.65% 2.40% 2.40% ===== ===== ===== * Heritage Asset Management, Inc. has agreed to waive its investment advisory fees and, if necessary, reimburse the fund to the extent that Class A annual operating expenses exceed 1.65% of the class' average daily net assets and Class B and Class C annual operating expenses exceed 2.40% of that class' average daily net assets for the fund's 2000 fiscal year. Any reduction in Heritage's management fees is subject to reimbursement by the fund within the following two years if overall expenses fall below these percentage limitations. EXPENSE 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 for Year 1 are net of fee waivers and/or expense reimbursement. Although your actual costs may be higher or lower, based on these assumptions your costs would be: YEAR 1 YEAR 3 SHARE CLASS ------ ------ A shares ...................................... $635 $1,034 B shares Assuming redemption at end of period ........ $743 $1,047 Assuming no redemption ...................... $243 $ 747 C shares ...................................... $243 $ 747 Prospectus 3 MANAGEMENT OF THE FUND WHO MANAGES YOUR FUND - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- INVESTMENT ADVISER. Heritage Asset Management, Inc. serves as the investment adviser and administrator for the fund. Heritage manages, supervises and conducts the business and administrative affairs of the fund and the other Heritage mutual funds with net assets totaling approximately $5.4 billion as of September 30, 1999. Heritage's contractual aggregate annual investment advisory and administration fee for the fund is 1.00% of the fund's average daily net assets on the first $100 million and 0.75% on average daily net assets over $100 million. Heritage is located at 880 Carillon Parkway, St. Petersburg, Florida 33716, and is a wholly owned subsidiary of Raymond James Financial, Inc. (RJF), together with its subsidiaries, provides a wide range of financial services to retail and institutional clients. SUBADVISER. Heritage may allocate and reallocate the assets of the fund among one or more investment subadvisers, subject to review by the Board of Trustees. In the future, Heritage may apply to the Securities and Exchange Commission (SEC) to receive approval to enter into new or modified subadvisory agreements with existing or new subadvisers without approval of fund shareholders, but with the approval of the fund's Board. Upon issuance of such relief from the SEC, no shareholder approval would be required, subject to certain conditions. One of the conditions would be that the fund must send notice to shareholders containing information about the new subadvisor or a material change to an existing subadvisory contract. Heritage has selected Eagle Asset Management, Inc., 880 Carillon Parkway, St. Petersburg, Florida 33716, to provide investment advice and portfolio management services to the fund's portfolio. Eagle has been managing private accounts since 1976 for a diverse group of clients, including individuals, corporations, municipalities and trusts. Eagle managed approximately $5.6 billion for these clients as of September 30, 1999. PORTFOLIO MANAGER. Duane Eatherly, a Senior Research Analyst of Eagle, is responsible for the day-to-day management of the fund's portfolio. From July 1996 to May 1999, Mr. Eatherly served as a Sector Manager (Technology Equities) at Banc One Investment Advisors. Prior to that, he was a Vice President (Acquisitions) with Banc One Private Label Credit Services from November 1995 to July 1996, and Senior Associate (Merchant Banking Group) with Banc One Capital Corporation from June 1993 to January 1996. Mr. Eatherly is a Chartered Financial Analyst and Certified Financial Planner. DISTRIBUTION OF FUND SHARES - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Raymond James & Associates, Inc. (RJA) currently serves as the distributor of the fund. Subject to regulatory approvals, the fund's Board of Trustees has approved a proposed distribution agreement with Heritage Fund Distributors, Inc. YEAR 2000 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The fund could be affected adversely if the computer systems used by Heritage, Eagle, the fund's other service providers, or companies in which the fund invests do not properly process and calculate information that relates to dates beginning on January 1, 2000 and beyond. Heritage and Eagle have taken steps that they believe are reasonably designed to address the potential failure of computer systems used by them and the fund's service providers to address the Year 2000 issue. However, due to the fund's reliance on various service providers to perform essential functions, the fund could have difficulty calculating its net asset value, processing orders for share sales and delivering account statements and other information to shareholders. There can be no assurance that these steps will be sufficient to avoid any adverse impact. Prospectus 4 YOUR INVESTMENT BEFORE YOU INVEST - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Before you invest in the fund, please o Read this prospectus carefully. o Next, decide which class of shares is best for you. o Finally, decide how much you wish to invest and how you want to open an account. CHOOSING A CLASS OF SHARES - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- You can choose from three classes of shares: Class A shares, Class B shares and Class C shares. Each class has a different combination of sales charges and ongoing fees allowing you to choose the class that best meets your needs. You should make this decision carefully based on: o the amount you wish to invest, o the different sales charges that apply to each share class, o whether you qualify for any reduction or waiver of sales charges, o the length of time you plan to keep the investment, and o the class expenses. CLASS A SHARES. You may purchase Class A shares at the "offering price" -- a price equal to their net asset value, plus a maximum sales charge of 4.75% imposed at the time of purchase. Class A shares are subject to ongoing distribution and service (Rule 12b-1) fees of up to 0.25% of their average daily net assets. These fees are lower than the ongoing Rule 12b-1 fees for Class B shares and Class C shares. If you choose to invest in Class A shares, you will pay a sales charge at the time of each purchase. The table below shows the charges both as a percentage of offering price and as a percentage of the amount you invest. If you invest more, the sales charge will be lower. You may qualify for a reduced sales charge or the sales charge may be waived as described below. CLASS A SALES CHARGES ---------------------
AS A % OF AS A % OF YOUR DEALER CONCESSION YOUR INVESTMENT OFFERING PRICE INVESTMENT AS % OF OFFERING PRICE(1) ---------------- --------------- ---------------- ------------------------- Less than $25,000....... 4.75% 4.99% 4.25% $25,000 - $49,000....... 4.25% 4.44% 3.75% $50,000 - $99,999....... 3.75% 3.90% 3.25% $100,000 - $249,999..... 3.25% 3.36% 2.75% $250,000 - $499,999..... 2.50% 2.56% 2.00% $500,000 - $999,999..... 1.50% 1.52% 1.25% $1,000,000 and over..... 0.00% 0.00% 0.00%(2)
- ----------- (1) During certain periods, the fund's distributor may pay 100% of the sales charge to participating dealers. Otherwise, it will pay the dealer concession shown above. (2) For purchases of $1 million or more, Heritage may pay from its own resources to the Distributor, up to 1.00% of the purchase amount on the first $3 million and 0.80% on assets thereafter. If you sell these shares within 18 months from the date of purchase, then you will be subject to a 1.00% "contingent deferred" sales charge at the time of sale and Heritage will retain the initial year's Rule 12b-1 fees. CLASS B SHARES. You may purchase Class B shares at net asset value with no initial sales charge. As a result, the entire amount of your purchase is invested immediately. However, if you sell the shares within 6 years of purchase, you will pay a "contingent deferred" sales charge (CDSC) at the time of sale of up to 5.00%. Class B shares are subject to ongoing Rule 12b-1 fees of up to 1.00% of Prospectus 5 their average daily net assets. This Rule 12b-1 fee is higher than the ongoing Rule 12b-1 fees for Class A shares but the same as for the Class C shares. Class B shares are offered for sale only for purchases of less than $250,000. If you choose to invest in Class B shares, you will pay a sales charge if you sell those shares within 6 years of purchase. The CDSC imposed on sales of Class B shares will be calculated by multiplying the original purchase cost or the current market value of the shares being sold, whichever is less, by the percentage shown on the following chart. The longer you hold the shares, the lower the rate of the CDSC. The CDSC may be waived as described below. Any period of time you held Class B shares of the Heritage Cash Trust-Money Market Fund will not be counted when determining your CDSC. CLASS B DEFERRED CHARGES ------------------------ REDEMPTION DURING: CDSC ON SHARES BEING SOLD ------------------ ------------------------- 1st year .............. 5% 2nd year .............. 4% 3rd year .............. 3% 4th year .............. 3% 5th year .............. 2% 6th year .............. 1% After 6 years ......... 0% CONVERSION OF CLASS B SHARES. If you buy Class B shares and hold them for 8 years, we automatically will convert them to Class A shares without charge. Any period of time you held Class B shares of the Heritage Cash Trust-Money Market Fund will be excluded from the 8-year period. At this time, we also will convert any Class B shares that you purchased with reinvested dividends and other distributions. We do this to lower your investment costs. When we do the conversion, you will receive Class A shares in an amount equal to the value of your Class B shares. However, because Class A and Class B shares have different prices, you may receive more or less Class A shares after the conversion. The dollar value will be the same, so you have not lost any money as a result of the conversion. CLASS C SHARES. You may purchase Class C shares at net asset value with no initial sales charge. As a result, the entire amount of your purchase is invested immediately. However, if you sell the shares less than 1 year after purchase, you will pay a CDSC at the time of sale of 1.00%. Class C shares are subject to ongoing Rule 12b-1 fees of up to 1.00% of their average daily net assets. This Rule 12b-1 fee is higher than the ongoing Rule 12b-1 fees for Class A shares and is the same as for the Class B shares. Class C shares do not convert to any other class of shares. Any period of time you held Class C shares of the Heritage Cash-Trust Money Market Fund will not be counted toward the 1-year period. If you choose to invest in Class C shares, you will pay a sales charge if you sell your shares less than 1 year after purchase. The CDSC imposed on sales of Class C shares will be calculated based on the original purchase cost or the current market value of the shares being sold, whichever is less. The CDSC may be waived as described below. UNDERSTANDING RULE 12B-1 FEES. The fund has adopted a plan under Rule 12b-1 that allows it to pay distribution and sales fees for the sale of its shares and for services provided to shareholders. Because these fees are paid out of the fund's assets on an ongoing basis, over time these fees will increase the cost of your investment and may cost you more than paying other types of sales charges. Prospectus 6 SALES CHARGE REDUCTIONS AND WAIVERS - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- We offer a number of ways to reduce or eliminate the initial sales charge on Class A shares or the CDSC on Class B and Class C shares. If you think you are eligible, contact Heritage or your financial advisor for further information. REDUCING YOUR CLASS A SALES CHARGE. We offer three programs designed to reduce your Class A sales charge. You may choose one of these programs to combine multiple purchases of Class A shares of Heritage mutual funds to take advantage of the reduced sales charges listed in the schedule above. Please complete the appropriate section of your account application, contact your financial advisor or Heritage if you would like to take advantage of these programs. o RIGHTS OF ACCUMULATION -- Lets you combine purchases in related accounts for purposes of calculating sales charges. Under this program, a related account includes any other direct or beneficial accounts you own, your spouse's accounts, or accounts held by your minor children. o COMBINED PURCHASE PRIVILEGE -- Lets you add the value of your previous Class A investments for purposes of calculating the sales charge if the total amount you have invested is at least $25,000. o STATEMENT OF INTENTION -- Lets you purchase Class A shares of any Heritage mutual fund over a 13-month period and receive the same sales charge as if all shares had been purchased at once. You must invest at least $25,000 to obtain the benefit of this privilege. WAIVER OF CLASS A SHARES SALES CHARGE. Class A shares may be sold at net asset value without any sales charge to: (1) Heritage and Eagle; (2) current and retired officers and Trustees of the fund; (3) directors, officers and full-time employees of Heritage, Eagle, any subadviser of a Heritage mutual fund, the fund's distributor and its affiliates; (4) registered financial advisors and employees of broker-dealers that are parties to dealer agreements with the fund's distributor (or financial institutions that have arrangements with such broker-dealers); and (5) directors, officers and full-time employees of banks that are party to agency agreements with the distributor, and all such persons' immediate relatives and their beneficial accounts. In addition, members of the American Psychiatric Association may purchase Class A shares at a sales charge equal to two-thirds of the percentages in the above table. The dealer concession also will be adjusted in a like manner. Class A shares also may be purchased without sales charges by investors who participate in certain broker-dealer wrap fee investment programs. Class A shares also may be sold at net asset value without any sales charges to individual retirement accounts, qualified retirement plans and taxable accounts that execute transactions through a single omnibus account that is maintained by a financial institution or service organization that has entered into an acceptable administrative or similar agreement with the applicable Heritage mutual fund, Heritage or the fund's distributor. In addition, Class A shares may be sold at net asset value without any sales charges to participants of retirement plans which have at least 100 participants or $50 million dollars. Heritage may pay from its own resources to the Distributor up to 1.00% of the purchase amount on the first $3 million and 0.80% on assets thereafter, by these plans. Any participant in these plans who redeems Class A shares within 18 months of his or her purchase may be subject to a CDSC of 1.00% and Heritage will retain the initial year's Rule 12b-1 fees. CDSC WAIVERS. The CDSC for Class A shares, Class B shares and Class C shares currently is waived if the shares are sold: o to make certain distributions from retirement plans, o because of shareholder death or disability (including shareholders who own shares in joint tenancy with a spouse), Prospectus 7 o to make payments through certain sales from a Systematic Withdrawal Plan of up to 12% annually of the account balance at the beginning of the plan, or o to close out shareholder accounts that do not comply with the minimum balance requirements. REINSTATEMENT PRIVILEGE. If you sell shares of a Heritage mutual fund, you may reinvest some or all of the sales proceeds up to 90 days later in the same share class of any Heritage mutual fund without incurring additional sales charges. If you paid a CDSC, the reinvested shares will have no holding period requirement. You must notify the fund if you decide to exercise this privilege. HOW TO INVEST - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- INITIAL OFFERING OF SHARES. The fund initially will offer its shares for sale during a period scheduled to end at the close of business on November 17, 1999. During this period, shares of the fund will be offered through RJA to participating dealers or banks at a price of $14.29 per Class A share (including the applicable sales charge) with a maximum offering price of $15.00 per share. Class B and Class C shares will be offered at $14.29. During this period, a financial advisor of RJA, participating dealers, or participating banks may receive payments for any orders. These persons may benefit from the temporary use of funds received prior to close of the initial offering period. After the close, the fund will commence investment operations. The fund may withdraw, cancel or modify the offering of shares during the initial offering period without notice or refuse any order in whole or in part, if the fund determines that it is in its best interests to do so. MINIMUM INITIAL INVESTMENT. Once you have chosen a share class, the next step is to determine the amount you wish to invest. The minimum initial investment for the fund is: MINIMUM INITIAL SUBSEQUENT TYPE OF ACCOUNT INVESTMENT INVESTMENT --------------- ---------------- --------------------- Regular Account ................... $1,000 No minimum Systematic Investment Program ..... $ 50 $50 on a monthly basis Retirement Account ................ $1,000 No minimum Heritage may waive these minimum requirements at its discretion. Investments in individual retirement accounts may be reduced or waived under certain circumstances. Contact Heritage or your financial advisor for further information. OPENING AN ACCOUNT. You may open an account in the following ways: THROUGH YOUR FINANCIAL ADVISOR. You may invest in the fund by contacting your financial advisor. Your financial advisor can help you open a new account and help you review your financial needs and formulate long-term investment goals and objectives. BY MAIL. You may invest in the fund directly by completing and signing the account application found in this prospectus. Indicate the class of shares and the amount you wish to invest. If you do not specify a share class, we will automatically choose Class A shares, which include a front-end sales charge. Make your check payable to the fund and specific class of shares you are purchasing. Mail the application and your payment to: Heritage Asset Management, Inc. P.O. Box 33022 St. Petersburg, FL 33733 BY DOLLAR COST AVERAGING PLANS. We offer the following plans to allow you to make regular, automatic investments into the fund. You determine the amount and frequency of your investments. You can terminate your plan at any time. Availability of these plans may be limited by your financial advisor. Prospectus 8 o AUTOMATIC INVESTING -- You may instruct us to transfer funds from a specific bank checking account to your Heritage account. This transfer will be effected either by electronic transfer or paper draft. Complete the appropriate sections of the account application or the Heritage Bank Draft Investing form to activate this service. o DIRECT DEPOSIT -- You may instruct your employer to direct all or part of your paycheck to your Heritage account. You also may direct to your account other types of payments you receive such as from an insurance company or another mutual fund family. Contact your financial advisor or Heritage for the direct deposit enrollment form. Please note the routing instructions are different than the Federal Reserve wire instructions discussed below. o GOVERNMENT DIRECT DEPOSIT -- Beginning in 1999, any newly established investment programs by employees of the Federal government must be paid through direct deposit. You can have your Social Security, military pension, paycheck or other Federal government payment sent to your Heritage account. Your completed Government Direct Deposit form requires Heritage's review and approval for processing. Contact your financial advisor or Heritage for an enrollment form. o AUTOMATIC EXCHANGE -- You may make automatic regular exchanges between two or more Heritage mutual funds. These exchanges are subject to the exchange requirements discussed below. If you discontinue any of these plans before your account reaches the required minimum investment, you must buy more shares to keep your account open. THROUGH A RETIREMENT PLAN. Heritage mutual funds offer a range of retirement plans, including self-directed, traditional and Roth IRAs, Keogh Plans, SEPs and SIMPLEs. A special application and custodial agreement is required. Contact your financial advisor or Heritage for more information. BY WIRE. You may invest in the fund by Federal Reserve wire sent from your bank. Mail your completed and signed account application to Heritage. Contact Heritage at (800) 421-4184 or your financial advisor to obtain your account number before sending the wire. Your bank may charge a wire fee. Send your investment and the following information by Federal Reserve or bank wire to: State Street Bank and Trust Company ABA #011-000-028 Account # 3196-769-8 Name of the Fund The class of shares to be purchased (Your account number assigned by Heritage) (Your name) HOW TO SELL YOUR INVESTMENT - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- You can sell -- or redeem -- shares of the fund for cash at any time, subject to certain restrictions. APPLICATION OF CDSC. To keep your CDSC as low as possible, each time you place a request to sell shares we will first sell any shares in your account that carry no CDSC. If there are not enough of these to meet your request, we will sell those shares that have the lowest CDSC. There is no CDSC on shares acquired through reinvestment of dividends or other distributions. However, any period of time you held Class B or Class C shares of Heritage Cash Trust--Money Market Fund will not be counted for purposes of calculating the CDSC. Prospectus 9 HOW TO SELL YOUR SHARES. You may contact your financial advisor or Heritage with instructions to sell your investment in the following ways: THROUGH YOUR FINANCIAL ADVISOR. You may sell your shares through your financial advisor who can prepare the necessary documentation. Your financial advisor will transmit your request to sell shares of the fund and may charge you a fee for this service. BY TELEPHONE. You may sell shares from your account by telephone by calling the fund at (800) 421-4184 prior to the close of regular trading on the New York Stock Exchange -- typically 4:00 p.m. Eastern time. If you do not wish to have telephone redemption privileges, you must complete the appropriate section of the account application. BY MAIL. You may sell shares of the fund by sending a letter of instruction. Specify the fund's name, your share class, your account number, the names in which the account is registered and the dollar value or number of shares you wish to sell. Include all signatures and any additional documents that may be required. Mail the request to Heritage Asset Management, Inc., P.O. Box 33022, St. Petersburg, FL 33733. Some circumstances require a written letter requesting sale of shares, along with a signature guarantee. These include: o Sales from any account that has had an address change in the past 30 days o Sales of greater than $50,000 o Sales in which payment is to be sent to an address other than the address of record o Sales in which payment is to be made to payees other than the exact registration of the account or o Exchanges or transfers into other Heritage accounts that have different titles We will only accept official signature guarantees from participants in our signature guarantee program, which includes most banks and security dealers. A notary public can not guarantee your signature. BY SYSTEMATIC WITHDRAWAL PLAN. This plan may be used for periodic withdrawals from your account. To establish, complete the appropriate section of the account application or the Heritage systematic withdrawal form (available from your financial advisor or Heritage) and send that form to Heritage. Availability of this plan may be limited by your financial advisor. You should consider the following factors when establishing a plan: o Make sure you have a sufficient amount of shares in your account. o Determine how much you wish to withdraw. You must withdraw a minimum of $50 for each transaction. o Make sure you are not planning to invest more money in this account (buying shares during a period when you also are selling shares of the same fund is not advantageous to you, because of sales charges). o Determine the schedule: monthly, quarterly, semiannual or annual basis. o Determine which day of the month you would like the withdrawal to occur. Available dates are the 1st, 5th, 10th or 20th day of the month. If such a date falls on the weekend, the withdrawal will take place on the next business day. o Heritage reserves the right to cancel systematic withdrawals if insufficient shares are available for two or more consecutive months. Prospectus 10 RECEIVING PAYMENT. When you sell shares, payment of the proceeds generally will be made the next business day after your order is received. If you sell shares that were recently purchased by check or pre-authorized automatic purchase, payment will be delayed until we verify that those funds have cleared, which may take up to two weeks. You may receive payment of your sales proceeds the following ways: o BY CHECK -- We will mail a check to the address of record or bank account specified on your account application. Checks made payable to other than the registered owners or sent to an address other than the address of record require written instruction accompanied by a signature guarantee, as described above. o BY WIRE -- You may request that we send your proceeds by Federal Reserve wire to a bank account you specify. You must provide wiring instructions to Heritage in writing. We normally will send these proceeds the next day. A $5.00 wire fee will be charged to your account. o TO YOUR BROKERAGE ACCOUNT -- If you place your redemption request with your financial advisor, payment can be directed to your brokerage account. Payment for these trades occurs three business days after you place your sale request. HOW TO EXCHANGE YOUR SHARES - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- If you own shares of the fund for at least 30 days, you can exchange those shares for shares of the same class of any other Heritage mutual fund provided you satisfy the minimum investment requirements. You may exchange your shares by calling your financial advisor or Heritage if you exchange to like titled Heritage accounts. Written instructions with a signature guarantee, as described above, are required if the accounts are not identically registered. You may make exchanges without paying any additional sales charges. However, if you exchange shares of the Heritage Cash Trust-Money Market Fund acquired by purchase (rather than exchange) for shares of another Heritage mutual fund, you must pay the applicable sales charge. Class B and Class C shares will continue to age from the original date and will retain the same CDSC rate as they had before the exchange. However, if you hold Class B shares or Class C shares in the Heritage Cash Trust--Money Market Fund, the time you hold those shares in that fund will not be counted for purposes of calculating the CDSC. ACCOUNT AND TRANSACTION POLICIES - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PRICE OF SHARES. The fund's regular business days are the same as those of the New York Stock Exchange, normally Monday through Friday. The net asset value per share (NAV) for each class of the fund is determined each business day at the close of regular trading on the New York Stock Exchange (typically 4:00 p.m., Eastern time). The share price is calculated by dividing a class's net assets by the number of its outstanding shares. Because the value of the fund's investment portfolio changes every business day, the NAV usually changes as well. In calculating NAV, the fund typically prices its securities by using pricing services or market quotations. However, in cases where these are unavailable or when the portfolio manager believes that subsequent events have rendered them unreliable, the fund may use fair-value estimates instead. In addition, the fund may invest in securities that are primarily listed on foreign exchanges that trade on weekends and other days when the fund does not price its shares. As a result, the NAV of the fund's shares may change on days when shareholders will not be able to purchase or redeem the fund's shares. TELEPHONE TRANSACTIONS. For your protection, telephone requests may be recorded in order to verify their accuracy. In addition, we will take measures to verify the identity of the caller, such as Prospectus 11 asking for name, account number, Social Security or other taxpayer ID number and other relevant information. If appropriate measures are taken, we are not responsible for any losses that may occur to any account due to an unauthorized telephone call. Also for your protection, telephone redemptions are not permitted on accounts whose name or addresses have changed within the past 30 days. Proceeds from telephone transactions can only be mailed to the address of record. TIMING OF ORDERS. All orders to purchase or sell shares are executed at the next NAV calculated after the order has been received in good order. Orders are accepted until the close of regular trading on the New York Stock Exchange every business day -- normally 4:00 p.m., Eastern time -- and are executed the same day at that day's NAV. Otherwise, all orders will be executed at the NAV determined as of the close of regular trading on the next trading day. RESTRICTIONS ON ORDERS. The fund and its distributor reserve the right to reject any purchase order and to suspend the offering of fund shares for a period of time. There are certain times when you may not be able to sell shares of the fund or when we may delay paying you the proceeds. This may happen during unusual market conditions or emergencies or when the fund cannot determine the value of its assets or sell its holdings. REDEMPTION IN KIND. We reserve the right to give you securities instead of cash when you sell shares of the fund. If the amount of the sale is at least either $250,000 or 1% of the fund's assets, we may give you securities from the fund's portfolio instead of cash. ACCOUNTS WITH BELOW-MINIMUM BALANCES. If your account balance falls below $500 as a result of selling shares (and not because of performance or sales charges), the fund reserves the right to request that you buy more shares or close your account. If your account balance is still below the minimum 60 days after notification, the fund reserves the right to close your account and send the proceeds to your address of record. DIVIDENDS, CAPITAL GAINS AND TAXES - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- DISTRIBUTIONS AND TAXES. The fund distributes to its shareholders dividends from its net investment income annually. Net investment income generally consists of interest income and dividends received on investments, less expenses. The dividends you receive from the fund will be taxed as ordinary income. The fund also distributes net capital gains to its shareholders normally once a year. Capital gains are generated by the fund when it sells assets in its portfolio for profit. Capital gains are taxed differently depending on how long the fund held the asset. Distributions of net gains recognized on the sale of assets held for one year or less are taxed as ordinary income; distributions of net gains recognized on the sale of assets held longer than that (long-term capital gains) are taxed at lower capital gains rates. Fund distributions of dividends and net capital gains are automatically reinvested in fund shares at NAV (without sales charge) unless you opt to take your distributions in cash, in the form of a check or direct them for purchase of shares in another Heritage mutual fund. However, if you have a retirement plan or a Systematic Withdrawal Plan, your distributions will be automatically reinvested in fund shares. Prospectus 12 In general, selling or exchanging shares and receiving distributions (whether reinvested or taken in cash) are all taxable events. These transactions typically create the following tax liabilities for taxable accounts:
TYPE OF TRANSACTION TAX STATUS ------------------- ---------- Income dividends ...................................................... Ordinary income rate Short-term capital gain distributions ................................. Ordinary income rate Long-term capital gain distributions .................................. Capital gains rate Sales or exchange of fund shares owned for more than one year ......... Long-term capital gains or losses (capital gains rate) Sales or exchange of fund shares owned for one year or less ........... Gains are taxed at the same rate as ordinary income; losses are subject to special rules
Dividend distributions will vary by class and are anticipated to be generally higher for Class A shares. TAX REPORTING. If you are a non-retirement account holder, then each year, we will send you a Form 1099 that tells you the amount of fund distributions you received for the prior calendar year, the tax status of those distributions, and a list of reportable sale transactions. Generally, fund distributions are taxable to you in the year you receive them. However, any distributions that are declared in October, November or December but paid in January generally are taxable as if received on December 31 of the year they are declared. WITHHOLDING TAXES. If you are a non-corporate shareholder and the fund does not have your correct social security or other taxpayer identification number, federal law requires us to withhold 31% of the distributions and sale proceeds payable to you. If you are otherwise subject to backup withholding, we also are required to withhold and pay to the IRS 31% of your distributions. Any tax withheld may be applied against the tax liability on your tax return. Because everyone's tax situation is unique, always consult your tax professional about federal, state and local tax consequences. Prospectus 13 FOR MORE INFORMATION More information on the fund is available free upon request, including the following: Statement of Additional Information (SAI). Provides more details about the fund and its policies. A current SAI is on file with the Securities and Exchange Commission and is incorporated herein by reference (is legally considered part of this prospectus). To obtain information contact Heritage Mutual Funds: By mail: 880 Carillon Parkway St. Petersburg, Florida 33716 By telephone: (800) 421-4184 [PHOTO MONTAGE] Text-only version of these documents and this prospectus are available, upon payment of a duplicating fee, by writing the Public Reference Room of the Securities and Exchange Commission in Washington, D.C. 20549-6009. Information on the operation of the public reference room may be obtained by calling the Commission at (800) SEC-0330. Reports and other information about the funds may be viewed on-screen or downloaded from the SEC's Internet web site at http://www.sec.gov. The fund's Investment Company and 1933 Act registration numbers are: Heritage Series Trust: 811-747033-57986 Technology Fund 811-747033-57986 No dealer, salesman or other person has been authorized to give any information or to make any representation other than that contained in this Prospectus in connection with the offer contained in this Prospectus, and, if given or made, such other information or representations must not be relied upon having been authorized by the funds or their distributor. This Prospectus does not constitute an offering in any state in which such offering may not lawfully be made. RAYMOND JAMES & ASSOCIATES, INC., [LOGO] DISTRIBUTOR Member New York Stock Exchange/SIPC P.O. Box 33022, St. Petersburg, FL 33733 727-573-8143 o 800-421-4184 - -------------------------------------------------------------------------------- ADDRESS SERVICE REQUESTED -----END PRIVACY-ENHANCED MESSAGE-----