JUNDT FUNDS INC, 485APOS, 1998-03-02

JUNDT FUNDS INC
485APOS, 1998-03-02

Previous: CRABBE HUSON FUNDS, 497, 1998-03-02

Next: AIRPLANES LTD, S-1/A, 1998-03-02

<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 2, 1998

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

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549

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

FORM N-1A
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 /X/
(FILE NO. 33-99080)
PRE-EFFECTIVE AMENDMENT NO. __ / /

POST-EFFECTIVE AMENDMENT NO. 6 /X/

AND/OR

REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 /X/
(FILE NO. 811-09128)

AMENDMENT NO. 8 /X/

(CHECK APPROPRIATE BOX OR BOXES.)

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

JUNDT FUNDS, INC.
(Exact Name of Registrant as Specified in Charter)

1550 UTICA AVENUE SOUTH, SUITE 950
MINNEAPOLIS, MINNESOTA 55416
(Address of Principal Executive Offices) (Zip Code)

(612) 541-0677
(Registrant's Telephone Number, including Area Code)

JAMES R. JUNDT
JUNDT ASSOCIATES, INC.
1550 UTICA AVENUE SOUTH, SUITE 950
MINNEAPOLIS, MINNESOTA 55416
(Name and Address of Agent for Service)

COPY TO:
JAMES E. NICHOLSON
FAEGRE & BENSON LLP
2200 NORWEST CENTER
90 SOUTH SEVENTH STREET
MINNEAPOLIS, MINNESOTA 55402

APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT

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

/ / immediately upon filing pursuant to paragraph (b)
/ / on (date) pursuant to paragraph (b)
/X/ 60 days after filing pursuant to paragraph (a)(1)
/ / on (date) pursuant to paragraph (a)(1)
/ / 75 days after filing pursuant to paragraph (a)(2)
/ / on (date) pursuant to paragraph (a)(2) 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.

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

The Registrant has registered an indefinite number or amount of securities
under the Securities Act of 1933 pursuant to Rule 24f-2 under the Investment
Company Act of 1940. The Registrant's most recent Rule 24f-2 Notice (relating to
the Registrant's fiscal year ended December 31, 1996) was filed on Form 24F-2
with the Commission on February 21, 1997.

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

THE JUNDT FUNDS, INC.

REGISTRATION STATEMENT ON FORM N-1A

PART A

PROSPECTUSES

<PAGE>
JUNDT GROWTH FUND
JUNDT U.S. EMERGING GROWTH FUND
JUNDT OPPORTUNITY FUND
JUNDT TWENTY-FIVE FUND

1550 UTICA AVENUE SOUTH, SUITE 950
MINNEAPOLIS, MINNESOTA 55416
1-800-370-0612

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

The Jundt Growth Fund, Inc. ("Growth Fund"), Jundt U.S. Emerging Growth Fund
("Emerging Fund"), Jundt Opportunity Fund ("Opportunity Fund") and Jundt
Twenty-Five Fund ("Twenty-Five Fund") (collectively, the "Funds") are
professionally managed mutual funds. Investors in each Fund become Fund
shareholders. Each Fund offers its shares in four classes (Classes A, B, C and
I), each subject to different selling and other expenses. This prospectus
relates to each Fund's Class A, B and C shares (the only shares offered to the
general public) and to Growth Fund's Class I shares (which are available only to
certain investors).

Each Fund's investment objective is long-term capital appreciation. However,
each Fund employs its own investment strategy and therefore involves different
risks.

- GROWTH FUND is a diversified fund that maintains a core portfolio of 30 to
50 stocks of primarily medium-size to larger American growth companies.

- EMERGING FUND is a diversified fund that maintains a core portfolio of 30
to 50 stocks of primarily American emerging growth companies.

- OPPORTUNITY FUND is a non-diversified fund that employs an aggressive yet
flexible investment program emphasizing a core portfolio of 30 to 50
stocks of American growth companies without regard to their size. The Fund
may also employ leverage, sell securities short and buy and sell futures
and options contracts to generate additional investment returns.

- TWENTY-FIVE FUND is a non-diversified fund that maintains a more
concentrated portfolio of 20 to 30 stocks of American growth companies
without regard to their size. The Fund may also employ leverage, sell
securities short and buy and sell futures and options contracts to
generate additional investment returns.

Before you invest, please read this Prospectus carefully and keep it for
future reference. It contains important information about the Funds, including
information on investment policies, risks and fees. A Statement of Additional
Information, containing more information on the Funds, is available free of
charge. You may obtain a copy by calling the Funds at 1-800-370-0612.

SHARES OF THE FUNDS ARE NOT OBLIGATIONS, DEPOSITS OR ACCOUNTS OF ANY BANK
AND ARE NOT ENDORSED OR GUARANTEED BY ANY BANK. THEY ARE NEITHER INSURED NOR
GUARANTEED BY THE U.S. GOVERNMENT OR ANY OF ITS AGENCIES, INCLUDING THE FEDERAL
DEPOSIT INSURANCE CORPORATION. SHARES OF THE FUNDS INVOLVE INVESTMENT RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.

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

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

PROSPECTUS DATED MAY 1, 1998
<PAGE>
SUMMARY OF RISK FACTORS

An investment in one or more of the Funds may be appropriate if you are
comfortable with a more volatile investment and are willing to take risk in the
hope of achieving higher long-term returns. If you anticipate needing your money
in a short time, or if you prefer a stable investment and would consider selling
your Fund shares at the first sign of loss in your investment portfolio, you
should consider other investment vehicles. The Funds are not designed to meet
these goals.

While mutual funds are a convenient and potentially rewarding way to invest,
they do not always meet their objectives. Please remember that you could lose
money with these investments.

In normal market conditions, each Fund will be substantially invested in a
portfolio of common stocks. Stocks may decline significantly in price over short
or extended periods of time. Price changes may affect the market as a whole, or
they may affect only a particular company, industry or sector of the market.

Emerging Fund will, and Opportunity Fund and Twenty-Five Fund may, from time
to time invest a substantial portion of their assets in securities of smaller
companies. Investments in such companies may offer greater opportunities for
capital appreciation than investments in larger companies, but their values may
fluctuate more sharply than those of larger companies as well and subject the
Funds to greater price volatility.

Twenty-Five Fund will normally maintain a portfolio of only 20 to 30 stocks.
This more concentrated investment portfolio may subject the Fund to greater
price volatility than a mutual fund with a more diversified portfolio.

In pursuing their investment objectives, Opportunity Fund and Twenty-Five
Fund may employ leverage, sell securities short and and buy and sell futures and
options contracts to generate additional investment returns. Use of each of
these techniques involves significant additional investment risk.

Each Fund may invest to a limited extent in foreign securities. Foreign
securities involve risks not typically associated with domestic investments,
including unfavorable changes in currency exchange rates, reduced and less
reliable information about issuers and markets, different accounting standards,
illiquidity of securities and markets, local economic or political instability
and greater market risk in general.

The risks of investing in each Fund are more fully explained under
"Investment Objectives and Policies" below.

2
<PAGE>
FEES AND EXPENSES

The following tables illustrate the expenses and fees you would incur as an
investor of each Fund and are designed to assist you in making investment
decisions. Of course, if you are contemplating an investment in a Fund, you
should also consider other relevant factors, including the Fund's investment
objective and historical performance.

GROWTH FUND

<TABLE>
<CAPTION>
CLASS A(a) CLASS B(b) CLASS C CLASS I(a)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Sales Charge Imposed on Purchases....... 5.25% NONE (c) NONE(c) 5.25%
Sales Charge Imposed on Dividend
Reinvestments................................. NONE NONE NONE NONE
Maximum Deferred Sales Load (as a percentage of
original purchase price or redemption
proceeds, whichever is lower)(d).............. 1.00% (e) 4.00% 1.00% 1.00% (e)
Redemption Fees(d).............................. NONE NONE NONE NONE
Exchange Fees................................... NONE NONE NONE NONE
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF
AVERAGE NET ASSETS):
Investment Advisory Fees(f)..................... 1.00% 1.00% 1.00% 1.00%
12b-1 Fees...................................... 0.25% 1.00% (c) 1.00%(c) NONE
Other Expenses.................................. 0.93% 0.93% 0.93% 0.93%
---------- ---------- ---------- ----------
TOTAL FUND OPERATING EXPENSES..................... 2.18% 2.93% 2.93% 1.93%
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------

EMERGING FUND

CLASS A(a) CLASS B(b) CLASS C
---------- ---------- ----------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Sales Charge Imposed on Purchases....... 5.25% NONE (c) NONE(c)
Sales Charge Imposed on Dividend
Reinvestments................................. NONE NONE NONE
Maximum Deferred Sales Load (as a percentage of
original purchase price or redemption
proceeds, whichever is lower)(d).............. 1.00% (e) 4.00% 1.00%
Redemption fees(d).............................. NONE NONE NONE
Exchange Fees................................... NONE NONE NONE
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF
AVERAGE NET ASSETS):
Investment Advisory Fees(f)..................... 1.00% 1.00% 1.00%
12b-1 Fees...................................... 0.25% 1.00% (c) 1.00%(c)
Other Expenses (after reimbursements)(g)........ 0.55% 0.55% 0.55%
---------- ---------- ----------
TOTAL FUND OPERATING EXPENSES (AFTER
REIMBURSEMENTS)(g).............................. 1.80% 2.55% 2.55%
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

<PAGE>

<TABLE>
<S> <C> <C> <C> <C>
OPPORTUNITY FUND
<CAPTION>

CLASS A(a) CLASS B(b) CLASS C
---------- ---------- ----------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Sales Charge Imposed on Purchases....... 5.25% NONE (c) NONE(c)
Sales Charge Imposed on Dividend
Reinvestments................................. NONE NONE NONE
Maximum Deferred Sales Load (as a percentage of
original purchase price or redemption
proceeds, whichever is lower)(d).............. 1.00% (e) 4.00% 1.00%
Redemption Fees(d).............................. NONE NONE NONE
Exchange Fees................................... NONE NONE NONE
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF
AVERAGE NET ASSETS):
Investment Advisory Fees(f)..................... 1.30% 1.30% 1.30%
12b-1 Fees...................................... 0.25% 1.00% (c) 1.00%(c)
Other Expenses (after reimbursements)(g)........ 0.59% 0.59% 0.59%
---------- ---------- ----------
TOTAL FUND OPERATING EXPENSES (AFTER
REIMBURSEMENTS)(g).............................. 2.14% 2.89% 2.89%
---------- ---------- ----------
---------- ---------- ----------

TWENTY-FIVE FUND
<CAPTION>

CLASS A(a) CLASS B(b) CLASS C
---------- ---------- ----------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Sales Charge Imposed on Purchases....... 5.25% NONE (c) NONE(c)
Sales Charge Imposed on Dividend
Reinvestments................................. NONE NONE NONE
Maximum Deferred Sales Load (as a percentage of
original purchase price or redemption
proceeds, whichever is lower)(d).............. 1.00% (e) 4.00% 1.00%
Redemption Fees(d).............................. NONE NONE NONE
Exchange Fees................................... NONE NONE NONE
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF
AVERAGE NET ASSETS):
Investment Advisory Fees(f)..................... 1.30% 1.30% 1.30%
12b-1 Fees...................................... 0.25% 1.00% (c) 1.00%(c)
Other Expenses (after reimbursements)(g)........ 0.70% 0.70% 0.70%
---------- ---------- ----------
TOTAL FUND OPERATING EXPENSES (AFTER
REIMBURSEMENTS)(g)............................ 2.25% 3.00% 3.00%
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

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

(a) Prior to April 22, 1997, Class I shares were referred to as Class A shares,
and the current Class A shares were referred to as Class D shares.

(b) Class B shares will convert automatically into Class A shares approximately
8 years after their sale. See "How to Buy Fund Shares."

(c) Class B and Class C shares are sold without a front-end sales charge;
however, their higher 12b-1 fees may cause long-term Class B and Class C
shareholders to pay more than the economic equivalent of the maximum
permitted front-end sales charge.

(d) In addition to any applicable deferred sales loads, service agents may
charge a nominal fee for effecting redemptions of Fund shares.

4
<PAGE>
(e) A contingent deferred sales charge of 1% is imposed on certain redemptions
of Class A shares (and in the case of Growth Fund, Class I shares) that were
purchased without an initial sales charge as part of an investment of $1
million or more. See "How to Buy Fund Shares--Class A Shares" and "--Jundt
Growth Fund Class I Shares."

(f) The investment advisory fee paid by each Fund is higher than the investment
advisory fee paid by most other mutual funds.

(g) The Investment Adviser has voluntarily agreed to reimburse Emerging Fund,
Opportunity Fund and Twenty-Five Fund for Fund operating expenses in excess
of the percentages indicated in the above tables during the year ending
December 31, 1998. Thereafter, the Investment Adviser may discontinue or
modify such reimbursements. Other Expenses and Total Fund Operating Expenses
for the year ended December 31, 1997 would have been approximately 2.10% and
3.35%, 2.10% and 4.10%, and 2.10% and 4.10% for Emerging Fund's Class A,
Class B and Class C shares, respectively, and approximately 5.02% and 6.57%,
5.02% and 7.32%, and 5.02% and 7.32% for Opportunity Fund's Class A, Class B
and Class C shares, respectively, without the expense reimbursement. Absent
expense reimbursements, Other Expenses and Total Fund Operating Expenses for
Twenty-Five Fund's Class A, Class B and Class C shares for the year ending
December 31, 1998 are estimated to be approximately 2.42% and 3.97%, 2.42%
and 4.72% and 2.42% and 4.72%, respectively.

EXAMPLES:

The following examples illustrates the expenses you would incur on a $1,000
investment over various periods, assuming a 5% annual return and redemption at
the end of each period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
GROWTH FUND
Class A(1).................... $73 $117 $163 $291
Class B....................... $70 $121 $174 $307
Class C....................... $40 $ 91 $154 $325
Class I(1).................... $71 $110 $151 $266

EMERGING FUND
Class A(1).................... $70 $106 $145 $253
Class B....................... $66 $109 $156 $270
Class C....................... $36 $ 79 $136 $289

OPPORTUNITY FUND
Class A(1).................... $73 $116 $161 $287
Class B....................... $69 $119 $172 $304
Class C....................... $39 $ 89 $152 $321

TWENTY-FIVE FUND
Class A(1).................... $74 $119 N/A N/A
Class B....................... $70 $123 N/A N/A
Class C....................... $40 $ 93 N/A N/A
</TABLE>

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

(1) Excludes the 1% contingent deferred sales charge that may be imposed on
certain redemptions of Class A shares or, in the case of Growth Fund, Class
I shares.

5
<PAGE>

If you invested in Class B and Class C shares, you would pay the following
expenses on the same investment, assuming no redemption at the end of each
period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
GROWTH FUND
Class B....................... $30 $ 91 $154 $307
Class C....................... $30 $ 91 $154 $325

EMERGING FUND
Class B....................... $26 $ 79 $136 $270
Class C....................... $26 $ 79 $136 $289

OPPORTUNITY FUND
Class B....................... $29 $ 89 $152 $304
Class C....................... $29 $ 89 $152 $321

TWENTY-FIVE FUND
Class B....................... $30 $ 93 N/A N/A
Class C....................... $30 $ 93 N/A N/A
</TABLE>

The purpose of the fee and expense information set forth above is to assist
you in understanding the various costs and expenses that you would bear directly
or indirectly in each Class of the Funds' shares. You will find more detailed
information about these expenses under "Management of the Fund." The Annual Fund
Operating Expenses for Growth Fund, Emerging Fund and Opportunity Fund are based
on actual expenses for the year ended December 31, 1997. The Annual Fund
Operating Expenses for Twenty-Five Fund represents management's good faith
estimate of Fund expenses (after voluntary expense reimbursements) for the year
ending December 31, 1998. The foregoing information should not be considered
representations of past or future returns or expenses which may be higher or
lower than those shown.

6
<PAGE>
FINANCIAL HIGHLIGHTS

The following Financial Highlights of the Funds have been audited by KPMG
Peat Marwick LLP, the Funds' independent auditors, whose report thereon was
unqualified. You should read the Financial Highlights in conjunction with the
financial statements of the Funds, including the notes and the independent
auditor's report, included in the 1997 Annual Report to Shareholders. The Annual
Report also contains further information about the performance of the Funds. You
may obtain copies without charge by calling the Funds at 1-800-370-0612. The
Annual Report is incorporated by reference in the Statement of Additional
Information and in this Prospectus. Prior to December 29, 1995, Growth Fund
operated as a closed-end investment company.

GROWTH FUND

<TABLE>
<CAPTION>
YEAR ENDED 12/31/97 YEAR ENDED 12/31/96
----------------------------------------- -----------------------------------------
PER SHARE DATA CLASS A CLASS B CLASS C CLASS I CLASS A CLASS B CLASS C CLASS I
- ---------------------------------------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period................................ $ 13.64 $ 13.56 $ 13.54 $ 13.69 $ 11.95 $ 11.95 $ 11.95 $ 11.95
-------- -------- -------- -------- -------- -------- -------- --------
Operations:
Net investment income (loss).......... (0.23) (0.32) (0.30) (0.19) (0.26) (0.36) (0.36) (0.23)
Net realized and unrealized gain
(loss) on investments and futures
transactions........................ 1.64 1.60 1.58 1.63 2.03 2.05 2.03 2.05
-------- -------- -------- -------- -------- -------- -------- --------
Total from operations................... 1.41 1.28 1.28 1.44 1.77 1.69 1.67 1.82
Distributions to shareholders:
From investment income--net............. -- -- -- -- -- -- -- --
From realized capital gains--net........ (0.85) (0.85) (0.85) (0.85) (0.08) (0.08) (0.08) (0.08)
Tax return of capital................... -- -- -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- -------- --------
Net asset value, end of period.......... $ 14.20 $ 13.99 $ 13.97 $ 14.28 $ 13.64 $ 13.56 $ 13.54 $ 13.69
-------- -------- -------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- -------- -------- --------
Total investment return (1)............. 10.67% 9.77% 9.82% 10.85% 14.81% 14.14% 13.97% 15.22%
Net assets at end of period (000s
omitted).............................. $ 604 $ 189 $ 80 $80,964 $ 340 $ 37 $ 2 $96,458
Ratio of expenses to average net
assets................................ 2.18% 2.93% 2.93% 1.93% 2.13% 2.88% 2.88% 1.88%
Ratio of net investment income (loss) to
average net assets.................... (1.49)% (2.28)% (2.32)% (1.22)% (1.81)% (2.53)% (2.49)% (1.56)%
Portfolio turnover rate (excluding
short-term securities)................ 115% 115% 115% 115% 57% 57% 57% 57%
Average commission per share (2)........ $0.0600 $0.0600 $0.0600 $0.0600 $0.0599 $0.0599 $0.0599 $0.0599
-------- -------- -------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- -------- -------- --------

<CAPTION>
PERIOD PERIOD
FROM FROM
YEAR 7/01/94 YEAR YEAR 9/3/91*
ENDED TO ENDED ENDED TO
PER SHARE DATA 12/31/95 12/31/94 6/30/94 6/30/93 6/30/92
- ---------------------------------------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period................................ $ 14.95 $ 13.53 $ 15.10 $ 13.78 $ 14.07
--------- --------- --------- --------- ---------
Operations:
Net investment income (loss).......... (0.12) (0.07) (0.11) (0.05) 0.13
Net realized and unrealized gain
(loss) on investments and futures
transactions........................ 2.71 1.83 (0.57) 1.38 (0.30)
--------- --------- --------- --------- ---------
Total from operations................... 2.59 1.76 (0.68) 1.33 (0.17)
Distributions to shareholders:
From investment income--net............. -- -- -- (0.01) (0.12)
From realized capital gains--net........ (5.59) -- (0.52) -- --
Tax return of capital................... -- (0.34) (0.37) -- --
--------- --------- --------- --------- ---------
Net asset value, end of period.......... $ 11.95 $ 14.95 $ 13.53 $ 15.10 $ 13.78
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Total investment return (1)............. 17.81% 13.06% (4.53)% 9.64% (1.30)%
Net assets at end of period (000s
omitted).............................. $140,642 $223,317 $ 202,192 $ 473,768 $465,055
Ratio of expenses to average net
assets................................ 1.60% 1.58%+ 1.55% 1.40% 1.37%+
Ratio of net investment income (loss) to
average net assets.................... (0.72)% (0.98)%+ (0.63)% (0.36)% 1.05%+
Portfolio turnover rate (excluding
short-term securities)................ 155% 19% 70% 66% 20%
Average commission per share (2)........ N/A N/A N/A N/A N/A
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
</TABLE>

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

* Commencement of operations.

(1) Total investment return is based on the change in net asset value of a share
during the period, assumes reinvestment of distributions and excludes the
effects of sales loads. Total investment returns for periods prior to
December 29, 1995 reflect performance of Growth Fund as a closed-end fund
(assuming reinvestment of distributions pursuant to Growth Fund's Dividend
Reinvestment Plan as then in effect); as an open-end fund, Growth Fund
incurs certain additional expenses as a result of the continuous offering
and redemption of its shares. Total investment returns for periods of less
than one full year are not annualized.

(2) For fiscal years beginning in 1996, Growth Fund is required to disclose its
average commission rate per share for purchases and sales of investment
securities subject to a commission.

+ Adjusted to an annual basis.

7
<PAGE>
EMERGING FUND

<TABLE>
<CAPTION>
YEAR ENDED 12/31/97 PERIOD FROM 1/2/96* TO 12/31/96
------------------------------------ ------------------------------------
PER SHARE DATA CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
- ---------------------------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.... $ 12.42 $ 12.37 $ 12.36 $ 10.00 $ 10.00 $ 10.00
-------- -------- -------- -------- -------- --------
Operations:
Investment loss--net.................. (0.11) (0.21) (0.21) (0.14) (0.24) (0.24)
Net realized and unrealized gain
(loss) on investments, futures
transactions and short sale
transactions........................ 4.09 4.05 4.04 4.47 4.52 4.51
-------- -------- -------- -------- -------- --------
Total from operations................... 3.98 3.84 3.83 4.33 4.28 4.27
Distributions to shareholders:
From realized capital gains--net...... (3.31) (3.31) (3.31) (1.91) (1.91) (1.91)
-------- -------- -------- -------- -------- --------
Net asset value, end of period.......... $ 13.09 $ 12.90 $ 12.88 $ 12.42 $ 12.37 $ 12.36
-------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- --------
Total investment return(1).............. 33.54% 32.55% 32.50% 43.40% 42.90% 42.82%
Net assets at end of period(000s
omitted).............................. $ 2,117 $ 3,786 $ 1,519 $ 1,275 $ 1,709 $ 1,766
Ratio of expenses, before reimbursement,
to average net assets................. 3.35% 4.10% 4.10% 3.83%+ 3.62%+ 4.32%+
Ratio of expenses, net of reimbursement,
to average net assets................. 1.80% 2.55% 2.55% 1.80%+ 2.55%+ 2.55%+
Ratio of net investment loss to average
net assets............................ (0.88)% (1.63)% (1.63)% (1.36)%+ (2.15)%+ (2.13)%+
Portfolio turnover rate (excluding
short-term securities)................ 264% 264% 264% 204% 204% 204%
Average commission per share............ $ 0.0600 $ 0.0600 $ 0.0600 $ 0.0600 $ 0.0600 $ 0.0600
-------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- --------
</TABLE>

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

* Commencement of operations.

+ Adjusted to an annual basis.

8
<PAGE>
OPPORTUNITY FUND

<TABLE>
<CAPTION>
YEAR ENDED 12/31/97 PERIOD FROM 12/26/96* TO 12/31/96
------------------------------------ ------------------------------------
PER SHARE DATA CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
- ---------------------------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.... $ 9.87 $ 9.87 $ 9.87 $ 10.00 $ 10.00 $ 10.00
-------- -------- -------- -------- -------- --------
Operations:
Investment loss--net.................. (0.17) (0.26) (0.25) -- -- --
Net realized and unrealized gain
(loss) on investments, futures
transactions and short sale
transactions........................ 4.12 4.12 4.10 (0.13) (0.13) (0.13)
-------- -------- -------- -------- -------- --------
Total from operations................... 3.95 3.86 3.85 (0.13) (0.13) (0.13)
Distributions to shareholders:
From realized capital gains--net...... (2.79) (2.79) (2.79) -- -- --
-------- -------- -------- -------- -------- --------
Net asset value, end of period.......... $ 11.03 $ 10.94 $ 10.93 $ 9.87 $ 9.87 $ 9.87
-------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- --------
Total investment return(1).............. 41.15% 40.25% 40.12% (1.30)% (1.30)% (1.30)%
Net assets at end of period (000s
omitted).............................. $ 1,084 $ 2,298 $ 427 $ 112 $ 1 $ 1
Ratio of expenses, before reimbursement,
to average net assets................. 6.85% 7.50% 7.63% 4.23%+ 4.98%+ 4.98%+
Ratio of expenses, excluding interest
expense, to average net assets........ 6.57% 7.32% 7.32% 4.23%+ 4.98%+ 4.98%+
Ratio of expenses, net of reimbursement
and excluding interest expense, to
average net assets.................... 2.14% 2.89% 2.89% 2.14%+ 2.89%+ 2.89%+
Ratio of net investment loss to average
net assets............................ (1.71)% (2.36)% (2.49)% (2.14)%+ (2.98)%+ (3.02)%+
Portfolio turnover rate (excluding
short-term securities)................ 298% 298% 298% 0% 0% 0%
Average commission per share(2)......... $ 0.0600 $ 0.0600 $ 0.0600 N/A N/A N/A
-------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- --------
</TABLE>

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

* Commencement of operations.

+ Adjusted to an annual basis.

(2) For the period ended December 31, 1996, Opportunity Fund did not incur
commissions as a result of securities being purchased in the
over-the-counter market.

9
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES

INVESTMENT OBJECTIVE

Each Fund's investment objective is long-term capital appreciation. As with
any mutual fund, the Funds cannot assure investors that their investment
objective will be achieved. Generation of current income is not an objective of
the Funds. Investors looking for current income or short-swing market gains are
discouraged from investing in the Funds.

Each Fund's investment objective, together with certain other investment
policies and restrictions designated in this prospectus as "fundamental" may not
be changed without the approval of the Fund's shareholders. Other policies and
restrictions may be changed without shareholder approval.

INVESTMENT POLICIES AND RISK CONSIDERATIONS

In pursuing its investment objective, each Fund employs its own investment
strategy and policies. An investment in each Fund, therefore, involves different
risks.

- GROWTH FUND is a diversified fund that maintains a core portfolio of 30 to
50 stocks of primarily medium-size to larger American growth companies. In
normal market conditions, at least half of the Fund's portfolio will be
invested in stocks of companies with annual revenues over $750 million. Up
to 20% of the Fund's assets may be invested in foreign securities. The
Fund may not employ leverage or sell securities short. The Fund may enter
into options and futures transactions for hedging purposes but not to
generate additional investment returns.

- EMERGING FUND is a diversified fund that maintains a core portfolio of 30
to 50 stocks of primarily American emerging growth companies. In normal
market conditions, at least half of the Fund's portfolio will be invested
in stocks of companies with annual revenues less than $750 million. Up to
10% of the Fund's assets may be invested in foreign securities. The Fund
may not employ leverage or sell securities short. The Fund may enter into
options and futures transactions for hedging purposes but not to generate
additional investment returns.

- OPPORTUNITY FUND is a non-diversified fund that employs an aggressive yet
flexible investment program emphasizing, in normal market conditions, a
core portfolio of 30 to 50 stocks of American growth companies without
regard to their size. The Fund may also employ leverage, sell securities
short and buy and sell futures and options contracts to generate
additional investment returns. As described below, these techniques
involve additional risk. Up to 10% of the Fund's assets may be invested in
foreign securities.

- TWENTY-FIVE FUND is a non-diversified fund that, in normal market
conditions, maintains a more concentrated portfolio of 20 to 30 stocks of
American growth companies without regard to their size. The Fund may also
employ leverage, sell securities short and buy and sell futures and
options contracts to generate additional investment returns. As described
below, these techniques involve additional risk. Up to 10% of the Fund's
assets may be invested in foreign securities.

SELECTION OF EQUITY INVESTMENTS. The Investment Adviser seeks to invest in
stocks of the fastest growing American companies with limited investments in
comparable foreign companies. In normal market conditions, at least 65% of each
Fund's assets must be invested in equity investments. For each of the Funds, the
Investment Adviser seeks companies it believes offer significant potential for

10
<PAGE>
growth in revenue and earnings. The Investment Adviser believes that such
companies offer investors the greatest potential for long-term capital
appreciation. The Investment Adviser uses a long-term fundamental approach in
identifying such companies. A "fundamental" approach includes looking at a
company's revenue and earnings growth, competitive advantages, management and
market opportunities and evaluating whether its stock is fairly valued at the
current market price. In general, the Investment Adviser selects investments
without regard to industry sectors and other defined selection procedures.

INVESTMENTS IN SMALLER COMPANIES. Emerging Fund will, and Opportunity Fund
and Twenty-Five Fund may, from time to time invest a substantial portion of
their assets in securities issued by smaller companies. Investments in such
companies may offer greater opportunities for capital appreciation than
investments in larger companies, but may involve certain special risks. Such
companies may have limited product lines, markets or financial resources and may
be dependent on a limited management group. The securities of such companies may
trade less frequently and in smaller volume than more widely held securities.
Their values may fluctuate more sharply than those of other securities and the
Funds may experience difficulty in establishing or closing out positions in
these securities at prevailing market prices. There may be less publicly
available information about, and market interest in, smaller companies than is
the case with larger companies. It may take longer for the prices of such
securities to reflect the full value of their issuers' underlying earnings
potential or assets.

SHORT SALES. When the Investment Adviser anticipates that the price of a
security will decline, it may sell the security short on behalf of Opportunity
Fund or Twenty-Five Fund and borrow the same security from a broker or other
institution to complete the sale. The Fund may make a profit or incur a loss
depending upon whether the market price of the security decreases or increases
between the date of the short sale and the date on which the Fund must replace
the borrowed security. An increase in the value of a security sold short by the
Fund over the price at which it was sold short will result in a loss to the
Fund, and there can be no assurance that the Fund will be able to close out the
position at any particular time or at an acceptable price. All short sales must
be fully collateralized, and neither Fund may sell securities short if,
immediately after the sale, the value of all securities sold short by the Fund
exceeds 25% of the Fund's total assets. In addition, each Fund limits short
sales of any one issuer's securities to 5% of the Fund's total assets and to 5%
of any one class of the issuer's securities.

FOREIGN SECURITIES. Growth Fund may invest up to 20%, and Emerging Fund,
Opportunity Fund and Twenty-Five Fund may each invest up to 10%, of the value of
its total assets in securities of foreign issuers. Each Fund may only purchase
foreign securities that are represented by American Depository Receipts listed
on a domestic securities exchange or included in the NASDAQ National Market
System, or foreign securities listed directly on a domestic securities exchange
or included in the NASDAQ National Market System. Interest or dividend payments
on such securities may be subject to foreign withholding taxes. The Funds'
investments in foreign securities involve considerations and risks not typically
associated with investments in securities of domestic companies, including
unfavorable changes in currency exchange rates, reduced and less reliable
information about issuers and markets, different accounting standards,
illiquidity of securities and markets, local economic or political instability
and greater market risk in general.

11
<PAGE>

DEBT SECURITIES. In normal market conditions, each Fund may invest up to
35% of its total assets in "investment grade" debt securities. However, when the
Investment Adviser believes that a defensive investment posture is warranted,
each Fund may invest without limitation in investment grade debt securities.
Debt securities are "investment grade" if they are rated Baa or higher by
Moody's Investors Service, Inc. ("Moody's") or BBB or higher by Standard &
Poor's Corporation ("S&P") or, if they are unrated, if the Investment Adviser
believes that they are comparable in quality. Securities rated Baa or BBB (and
similar unrated securities) lack outstanding investment characteristics, have
speculative characteristics, and are subject to greater credit and market risks
than higher-rated securities. A Fund will not necessarily dispose of an
investment if, after its purchase, its rating slips below investment grade.
However, the Investment Adviser will monitor such investments closely and will
sell such investments if the Investment Adviser at any time believes that it is
in the Fund's best interests. Each Fund also may invest in non-investment grade
"convertible" debt securities. See "Convertible Securities."

CONVERTIBLE SECURITIES. Each Fund may invest in convertible securities. A
convertible security (a bond or preferred stock) may be converted at a stated
price within a specified period of time into a certain number of common shares
of the same or a different issuer. Convertible securities are senior to common
stock in an issuer's capital structure, but are usually subordinate to similar
non-convertible securities. While providing a fixed income stream (generally
higher in yield than the income from common stocks but lower than that afforded
by a similar non-convertible security), a convertible security also affords an
investor the opportunity, through its conversion feature, to participate in the
capital appreciation of the issuer's common stock. Each Fund may invest in
non-investment grade convertible debt securities. Such securities (sometimes
referred to as "junk bonds") are considered speculative and may be in poor
credit standing or even in default as to payments of principal or interest.
Moreover, such securities generally are less liquid than investment grade debt
securities.

BORROWING AND LEVERAGE. Opportunity Fund and Twenty-Five Fund may borrow
money to invest in additional portfolio securities. This practice, known as
"leverage," increases such Funds' market exposure and their risk. When a Fund
has borrowed money for leverage and its investments increase or decrease in
value, the Fund's net asset value will normally increase or decrease more than
if it had not borrowed money. In addition, the interest the Fund must pay on
borrowed money will reduce any gains or increase any losses. Successful use of
leverage depends on the Investment Adviser's ability to predict market movements
correctly. The amount of money borrowed by a Fund for leverage may not exceed
one-third of the Fund's assets (including the amount borrowed).

OPTIONS AND FUTURES. Each Fund may buy and sell call and put options and
futures contracts and related options (including index futures contracts and
related options) to hedge against changes in net asset value and, in the case of
Opportunity Fund and Twenty-Five Fund, to attempt to realize a greater current
return. There is no assurance that the Funds will be able to utilize these
instruments effectively for the purposes stated above. Options and futures
contracts transactions involve certain costs and risks, which are described
below and in the Statement of Additional Information.

Successful use of futures contracts and related options depends greatly on
the Investment Adviser's ability to correctly forecast the direction of market
movements. In the case of an incorrect market forecast, the use of futures
contracts will reduce or eliminate gains or subject a Fund to increased risk of
loss. In addition, changes in the price of futures contracts or options may not

12
<PAGE>

correlate perfectly with the changes in the market value of the securities
subject to a hedge. As a result, even a correct market forecast could result in
an unsuccessful hedging transaction.

Other risks arise from a Fund's potential inability to close out futures
contracts or options positions. Although each Fund will enter into options or
futures contracts transactions only if the Investment Adviser believes that a
liquid secondary market exists for such options or futures contracts, there can
be no assurance that the Fund will be able to effect closing transactions at any
particular time or at an acceptable price. In addition, certain provisions of
the Internal Revenue Code may limit each Fund's ability to engage in options and
futures contracts transactions.

Opportunity Fund and Twenty-Five Fund may use futures contracts and related
options to enhance investment returns in addition to hedging against market
risk. Such use of futures contracts involves risks similar to the use of
leverage. Within applicable regulatory limits, Opportunity Fund and Twenty-Five
Fund can be subject to the same degree of market risk as if approximately twice
their net assets were fully invested in securities. This may result in
substantial additional gains in rising markets, but likewise may result in
substantial additional losses in falling markets.

Each Fund expects that its options and futures contracts transactions
generally will be conducted on recognized exchanges. Each Fund may in certain
instances purchase and sell options in the over-the-counter markets. A Fund's
ability to terminate options in the over-the-counter markets may be more limited
than for exchange-traded options, and such transactions also involve the risk
that securities dealers participating in such transactions may be unable to meet
their obligations to the Fund. A Fund will, however, engage in over-the-counter
transactions only when appropriate exchange-traded transactions are unavailable
and when, in the opinion of the Investment Adviser, the pricing mechanism and
liquidity of over-the-counter markets are satisfactory and the participants are
responsible parties likely to meet their obligations.

Options and futures contracts involve transaction costs and may require each
Fund to segregate assets to cover its outstanding positions. For more
information, see the Statement of Additional Information.

NON-DIVERSIFICATION. As "non-diversified" funds, Opportunity Fund and
Twenty-Five Fund may invest in a more limited number of issuers than
"diversified" funds. This subjects the Funds to greater exposure if the value of
any one portfolio investment were to decline. However, neither Fund may invest
more than 25% of its assets in any one issuer (excluding U.S. Government
securities). Additionally, 50% of each such Fund's assets must be fully
diversified. This means that no one issuer (excluding U.S. Government
securities) in that half of the portfolio may account for more than 5% of the
Fund's total assets.

SECTOR CONCENTRATION. At times, each Fund may invest more than 25% of its
assets in one or more market sectors such as, for example, the technology
sector. A market sector may be made up of companies in a number of related
industries. When a Fund concentrates in a market sector, financial, economic,
business and other developments affecting that sector will have a greater impact
on the Fund than if it had not concentrated in that sector.

SECURITIES LOANS AND REPURCHASE AGREEMENTS. Each Fund may lend portfolio
securities to broker-dealers and may enter into repurchase agreements. These
transactions must be fully collateralized at all times, but involve some risk to
the Fund if the other party should default on its obligations and the Fund is
delayed or prevented from recovering the collateral.

13
<PAGE>

PORTFOLIO TURNOVER. Each Fund is managed for long-term capital
appreciation. However, the Fund's annual portfolio turnover rates (a measure of
change in fund investments) have from time to time historically exceeded 100%.
Higher portfolio turnover generally involves additional transaction costs to a
Fund and may also result in faster realization of taxable capital gains.

INVESTMENT RESTRICTIONS

Each Fund has adopted certain fundamental investment restrictions which may
not be changed without shareholder approval. These restrictions prohibit each
Fund, among other matters, from: (a) investing more than 25% of its total assets
in any one industry (securities issued or guaranteed by the United States
Government, its agencies or instrumentalities are not considered to represent
industries); or (b) borrowing money, except from banks for temporary or
emergency purposes or, in the case of Opportunity Fund and Twenty-Five Fund, as
required in connection with otherwise permissible leverage activities in an
amount not in excess of one-third of the value of the Fund's total assets.
Additionally, each Fund has adopted certain non-fundamental investment
restrictions which may be changed by the Board of Directors without the approval
of the Fund's shareholders. See the Statement of Additional Information for a
listing of each Fund's investment restrictions.

BROKERAGE AND PORTFOLIO TRANSACTIONS

The Investment Adviser is responsible for investment decisions and for
executing each Fund's portfolio transactions. The Funds have no obligation to
execute transactions with any particular broker-dealer. The Investment Adviser
seeks to obtain the best combination of price and execution for each Fund's
transactions. However, the Funds do not necessarily pay the lowest commission.

Where best price and execution may be obtained from more than one
broker-dealer, the Investment Adviser may purchase and sell securities through
broker-dealers that provide research and other valuable information to the
Investment Adviser. Such information may be useful to the Investment Adviser in
providing services to clients other than the Funds.

Consistent with the rules and regulations of the National Association of
Securities Dealers, Inc., the Investment Adviser may consider distribution of
Fund shares when choosing broker-dealers.

Other clients of the Investment Adviser have investment objectives similar
to those of the Funds. The Investment Adviser, therefore, may combine the
purchase or sale of investments for the Funds and its other clients. Such
simultaneous transactions may increase the demand for the investments being
purchased or the supply of the investments being sold, which may have an adverse
effect on price or quantity. The Investment Adviser's policy is to allocate
investment opportunities fairly among the clients involved, including the Funds.
When two or more clients are purchasing or selling the same security on a given
day from or through the same broker-dealer, such transactions may be averaged as
to price.

MANAGEMENT OF THE FUNDS

The Board of Directors is responsible for the overall management and
operation of each Fund. The Fund's officers are responsible for the day-to-day
operations of the Fund under the Board's supervision.

14
<PAGE>
INVESTMENT ADVISER

The Investment Adviser is responsible for the management of the Funds'
investment portfolios. The Investment Adviser was incorporated in December 1982.
As of December 31, 1997, the Investment Adviser managed approximately $1 billion
of assets for the Funds and other institutional clients.

Growth Fund and Emerging Fund pay the Investment Adviser advisory fees of
1.00% per year of each Fund's average daily net assets. Opportunity Fund and
Twenty-Five Fund pay the Investment Adviser advisory fees of 1.30% per year of
each Fund's average daily net assets. Most other mutual funds pay their
investment advisers lower fees.

James R. Jundt serves as Chairman of the Board and Chief Executive Officer
of the Investment Adviser and owns 95% of its stock. A trust benefiting Mr.
Jundt's children and grandchildren owns the remaining 5% of the Investment
Adviser's stock.

PORTFOLIO MANAGERS

The Investment Adviser employs a team approach in conducting its portfolio
management activities, and all investment decisions are made by one or more of
the firm's portfolio managers: James R. Jundt, Donald M. Longlet, Thomas L.
Press and Marcus E. Jundt.

James R. Jundt, CFA, began his investment career in 1964 with Merrill Lynch,
Pierce, Fenner & Smith Incorporated, New York, New York, as a security analyst
before joining Investors Diversified Services, Inc. (now known as American
Express Financial Advisers, Inc.) in Minneapolis, Minnesota in 1969, where he
served in analytical and portfolio management positions until 1979. From 1979 to
1982, Mr. Jundt was a portfolio manager for St. Paul Advisers, Inc. (now known
as Fortis Advisers, Inc.) in Minneapolis. In December 1982, Mr. Jundt left St.
Paul Advisers and founded the Investment Adviser. He has served as Chairman of
the Board, President and Chief Executive Officer of Growth Fund since 1991 and
of Jundt Funds, Inc. since 1995. Mr. Jundt has approximately 34 years of
investment experience. Mr. Jundt also serves as Chairman of the Board of the
Distributor.

Donald M. Longlet, CFA, began his investment career in 1968 with
Northwestern National Bank of Minneapolis (now known as Norwest Bank Minnesota,
National Association), where he served as a security analyst and portfolio
manager until 1982. Mr. Longlet worked as a portfolio manager for AMEV Advisers,
Inc. (now known as Fortis Advisers, Inc.) from 1983 until 1989, when he joined
the Investment Adviser as a portfolio manager. He has served as Vice President
and Treasurer of Growth Fund since 1991 and of Jundt Funds, Inc. since 1995. Mr.
Longlet has approximately 30 years of investment experience.

Thomas L. Press was a Senior Vice President of Investment Advisers, Inc. in
Minneapolis and Co-Manager of the IAI Emerging Growth Fund from 1992 until 1993,
when he joined the Investment Adviser as a portfolio manager. From 1987 to 1992,
Mr. Press was a Vice President, Institutional Sales in the Chicago office of
Morgan Stanley & Co., Inc., and prior thereto was an institutional salesman and
trader in the Chicago office of Salomon Brothers Inc. He has served as a
portfolio manager of Growth Fund since 1993 and of Jundt Funds, Inc. since 1995.
Mr. Press has approximately 13 years of investment experience.

Marcus E. Jundt, son of James R. Jundt, has been Vice Chairman of the
Investment Adviser since 1992. Mr. Jundt was employed as a research analyst for
Victoria Investors in New York, New York from 1988 to 1992, and from 1987 to
1988 was employed by Cargill Investor Services, Inc., where he

15
<PAGE>

worked on the floor of the Chicago Mercantile Exchange. He has served as a
portfolio manager of Growth Fund since 1992 and of Jundt Funds, Inc. since 1995.
Mr. Jundt has approximately 11 years of investment and related experience. Mr.
Jundt also serves as the President of the Distributor.

ADMINISTRATOR

Princeton Administrators, L.P. (the "Administrator"), an affiliate of
Merrill Lynch, Pierce, Fenner & Smith, Inc., performs various administrative and
accounting services for the Funds. Growth Fund currently pays the Administrator
fees of .20% per year of the Fund's average daily net assets. Emerging Fund,
Opportunity Fund and Twenty-Five Fund each pay the Administrator fees of .20%
per year of the Fund's average daily net assets (subject to a minimum of $40,000
per year per Fund).

DISTRIBUTOR; RULE 12b-1 DISTRIBUTION PLANS

U.S. Growth Investments, Inc. (the "Distributor"), a firm owned by James R.
Jundt, serves as the distributor for each Fund. Each Fund has adopted Rule 12b-1
Distribution Plans with respect to its Class A, B and C shares. Each Class A,
Class B and Class C Distribution Plan provides that the Distributor will be paid
an "account maintenance fee" of 0.25% per year of the average daily net assets
of such Class. This fee is used to compensate the Distributor and firms
authorized to sell Fund shares for providing various services to Fund
shareholders, such as answering shareholder questions, providing reports and
other information and providing various other account-related investor services.
Each Class B and Class C Distribution Plan also provides that the Distributor
will be paid a "distribution fee" of 0.75% per year of the average daily net
assets of such Class. This fee is used to compensate the Distributor for
advertising, marketing and distributing Class B and Class C shares, including
paying initial and ongoing sales compensation to the Distributor's sales
representatives and to firms authorized to sell shares. Firms authorized to sell
Fund shares, therefore, may receive different amounts of compensation depending
upon which Class of shares is sold.

In addition, the Distributor may pay certain additional cash incentives of
up to $100 and/or non cash incentives to its investment executives and other
authorized firms. In some instances, other incentives may be made available only
to selected broker-dealers and financial institutions, based on certain
objective standards. In addition, the Distributor may pay additional amounts to
qualifying broker-dealers or firms for certain services or activities which are
primarily intended to result in sales of Fund shares.

TRANSFER AGENT, DIVIDEND DISBURSING AGENT AND CUSTODIAN; SUBACCOUNTING AGENTS

Investors Fiduciary Trust Company (the "Transfer Agent"), 330 West 9th
Street, Kansas City, Missouri 64105, serves as the Funds' transfer agent and
dividend disbursing agent. Norwest Bank Minnesota, N.A., Norwest Center, Sixth
and Marquette, Minneapolis, Minnesota 55479, serves as the Funds' custodian. In
addition, the Funds compensate certain broker-dealers that sell Fund shares for
performing various accounting and administrative services with respect to large
street-name accounts maintained by such broker-dealers.

16
<PAGE>
HOW TO BUY FUND SHARES

ALTERNATIVE PURCHASE ARRANGEMENTS

Each Fund offers you the choice among three Classes of shares, namely,
Classes A, B and C, which offer different sales charges and bear different
expenses. THE FUNDS' CLASS I SHARES ARE OFFERED FOR SALE EXCLUSIVELY TO CERTAIN
SPECIFIED INVESTORS AND ARE NOT OFFERED FOR SALE TO THE GENERAL PUBLIC. You
should choose the class of shares that is best for you given the amount of your
purchase, the length of time you expect to hold the shares and other factors.

GENERAL PURCHASE INFORMATION

The minimum initial investment is $1,000. The minimum additional investment
is $50. A Fund may waive or reduce these minimums for certain retirement and
employee savings plans or custodial accounts for the benefit of minors. You may
purchase Fund shares from the Distributor, the Transfer Agent and firms that
have selling agreements with the Distributor. You may buy shares by opening an
account either by mail or by phone. Your purchase will be effective at the time
the net asset value of the Fund you choose is determined on the day your order
for the purchase of the shares is received in good form and accepted by the
Fund. The purchase price will be the net asset value per share determined at
that time, plus any sales charges.

In placing your order, you must specify which Class of shares you are
buying. If no Class is specified, your order will be treated as an investment in
Class A shares.

AUTOMATIC INVESTMENT PLAN. You may make automatic monthly investments
through each Fund's Automatic Investment Plan. For additional information, call
your broker or the Funds.

PURCHASES BY MAIL. To open an account by mail, complete the attached
general authorization form and mail it, along with a check payable to the Fund,
c/o Investors Fiduciary Trust Company at: P.O. Box 419168, Kansas City, MO
64141-6168 (for regular mail) or 330 West 9th Street, Kansas City, MO 64105 (for
overnight delivery). You may not purchase shares with a third party check.

PURCHASES BY TELEPHONE. To open an account by telephone, call
1-800-370-0612 to obtain an account number and instructions. Information
concerning the account will be taken over the phone. You must then request a
commercial bank with which you have an account and which is a member of the
Federal Reserve System to transmit Federal Funds by wire to the Fund you choose
as follows: State Street Bank & Trust Company, ABA #011000028, for credit of:
[Name of Fund], Account No.: 9905-154-2, Account Number: [assigned by
telephone]. Your bank may charge you for the wire transfer. You must then
complete the general authorization form attached to this Prospectus and mail it
to the Fund after making the initial telephone purchase.

PURCHASES BY TAX-DEFERRED RETIREMENT PLANS. You may establish an account in
any Fund as an Individual Retirement Account ("IRA"). You should consult with
your tax advisor to determine if you qualify to deduct all or part of any IRA
contribution for purposes of federal and state income tax returns. You may also
be able to purchase Fund shares as an investment for other qualified retirement
plans in which you participate, such as profit-sharing and money purchase plans,
401(k) programs, 403(b) plans, Simplified Employer Pension (SEP) Plans and
others. You should consult your employer or plan administrator before investing.

17
<PAGE>
PURCHASES THROUGH CERTAIN BROKERS AND AGENTS. In addition to any applicable
front-end or contingent deferred sales charges, you may be charged an additional
fee at the time you purchase or redeem Fund shares through a broker or agent. No
charges (other than wire transfer charges) currently are imposed if purchases or
redemptions are made directly through the Transfer Agent or Distributor.

CLASS A SHARES--INITIAL SALES CHARGE ALTERNATIVE

Class A shares of each Fund are sold at their net asset value next
determined after an order is received plus the applicable front-end sales charge
("FESC"). The Fund receives the net asset value. The FESC varies depending on
the size of the purchase. Of the total FESC, your broker's employer receives the
amount under the "Your Broker Receives" column in the table below. The balance
of the FESC is retained by the Distributor. The current FESC schedule is as
follows:

<TABLE>
<CAPTION>
FRONT-END SALES CHARGE (YOU PAY)
--------------------------------- YOUR BROKER RECEIVES
(AS A % OF (AS A % OF (AS A % OF
AMOUNT OF INVESTMENT OFFERING PRICE) NET INVESTMENT) OFFERING PRICE)
- ------------------------------ --------------- --------------- --------------------
<S> <C> <C> <C>
Less than $25,000............. 5.25% 5.54% 4.50%
$25,000 but less than
$50,000..................... 4.75% 4.99% 4.25%
$50,000 but less than
$100,000.................... 4.00% 4.17% 3.50%
$100,000 but less than
$250,000.................... 3.00% 3.09% 2.50%
$250,000 but less than
$1,000,000.................. 2.00% 2.04% 1.75%
$1,000,000 and greater........ NONE* NONE* *
</TABLE>

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

* On investments of $1 million or more, the Distributor will pay your broker a
commission of 1% of the investment amount up to $2.5 million, 0.50% of the
amount between $2.5 million and $5 million and 0.25% of the amount over $5
million. If you redeem these shares within one year, a contingent deferred
sales charge of 1% will be deducted from your redemption proceeds and paid
to the Distributor. See "How to Redeem Your Fund Shares--Contingent Deferred
Sales Charge."

In addition to your broker's portion of the FESC, the Distributor pays your
broker's employer an annual fee of 0.25% of your Fund investment beginning one
year after you purchase your shares.

SPECIAL PURCHASE PLANS--REDUCED SALES CHARGES. Certain investors (or groups
of investors) may qualify for reductions in the sales charges shown above. You
should contact your broker or the Fund for details about the Combined Purchase
Privilege, Cumulative Quantity Discount and Letter of Intention plans.
Descriptions are also included in the attached general authorization form and in
the Statement of Additional Information. The Distributor may amend or eliminate
these special purchase plans at any time without notice.

RULE 12b-1 FEES. Class A shares are subject to a Rule 12b-1 account
maintenance fee of 0.25% per year of the average daily net assets of Class A.
See "Management of the Funds--Distributor; Rule 12b-1 Distribution Plans."

WAIVER OF SALES CHARGES. You will not be charged an FESC or a contingent
deferred sales charge if you pay for your Class A shares with the proceeds from
your redemption of an unrelated mutual fund that charges a sales charge. To
qualify, your purchase order for Class A shares must be received by the Funds
within 60 days after such redemption.

18
<PAGE>
You also will not be charged an FESC or a contingent deferred sales charge
if you are in one of the following categories of investors:

- Investment executives and other employees of broker-dealers and financial
institutions that have entered into selling agreements with the
Distributor, employees of contractual service providers to the Funds, and
parents and immediate family members of such persons.

- Trust companies and bank trust departments for funds held in a fiduciary,
agency, advisory, custodial or similar capacity.

- States and their political subdivisions, and instrumentalities,
departments, authorities and agencies of states and their political
subdivisions.

- Registered investment advisers and their investment advisory clients.

- Employee benefit plans qualified under Section 401(a) of the Code (which
does not include IRAs) and custodial accounts under Section 403(b)(7) of
the Code (also known as tax-sheltered annuities).

CLASS B SHARES--CONTINGENT DEFERRED SALES CHARGE ALTERNATIVE

Class B shares of each Fund are sold at their net asset value next
determined after an order is received. However, a contingent deferred sales
charge ("CDSC") of up to 4% will be deducted from your redemption proceeds if
your Class B shares are redeemed within six years of purchase. See "How to
Redeem Your Fund Shares--Contingent Deferred Sales Charge." In addition, Class B
shares are subject to higher Rule 12b-1 fees, as described below. The CDSC
depends on the number of years since the purchase was made, according to the
following table, and is calculated on the lesser of the net asset value of the
shares at the time of purchase or at the time of redemption. The Distributor
receives all CDSCs.

<TABLE>
<CAPTION>
CDSC (% OF
AMOUNT SUBJECT
REDEMPTION DURING TO CHARGE)
---------------------------------------------------- --------------
<S> <C>
1st Year Since Purchase............................. 4%
2nd Year Since Purchase............................. 4%
3rd Year Since Purchase............................. 3%
4th Year Since Purchase............................. 3%
5th Year Since Purchase............................. 2%
6th Year Since Purchase............................. 1%
Thereafter.......................................... None
</TABLE>

Although you do not pay an FESC or any other charges at the time you
purchase Class B shares, the Distributor pays the firm employing your broker a
commission of 4% of the amount you invest. The Distributor also pays your
broker's employer an annual fee of 0.25% of your Fund investment beginning one
year after you purchase your shares. Because Class B shares may not be the best
choice for you if you intend to invest $250,000 or more, orders for Class B
shares of $250,000 or more will be treated as orders for Class A shares or
declined.

RULE 12b-1 FEES. Class B shares are subject to a Rule 12b-1 account
maintenance fee of 0.25% per year of the average daily net assets of Class B and
a Rule 12b-1 distribution fee of 0.75% per year of

19
<PAGE>

the average daily net assets of Class B. See "Management of the
Funds--Distributor; Rule 12b-1 Distribution Plans." The higher Rule 12b-1 fee
will cause Class B shares to have a higher expense ratio and to pay lower
dividends than Class A shares.

CONVERSION FEATURE. On the 15th day of the month (or the next business day
if the 15th is on a weekend or holiday) following the eighth anniversary of your
purchase of Class B shares, such shares (including a proportionate amount of
reinvested distributions on such shares) will automatically convert to Class A
shares and will no longer be subject to Class B's higher Rule 12b-1 fees. Your
Class B shares will convert into Class A shares on the basis of their relative
net asset values. The Class A shares you receive will not be subject to any FESC
or CDSC. Class B shares acquired by exercise of the "reinstatement privilege"
will convert into Class A shares based on the time of the original purchase of
Class B shares. See "How to Redeem Your Fund Shares--Reinstatement Privilege."

CLASS C SHARES--LEVEL LOAD ALTERNATIVE

Class C shares of each Fund are sold at their net asset value next
determined after an order is received. However, a CDSC of 1% will be deducted
from your redemption proceeds if your Class C shares are redeemed within one
year of purchase. See "How to Redeem Your Fund Shares--Contingent Deferred Sales
Charge." In addition, Class C shares are subject to higher Rule 12b-1 fees, as
described below. The Distributor receives all CDSCs.

Although you do not pay a FESC or any other charges at the time you purchase
Class C shares, the Distributor pays the firm employing your broker a commission
of 1% of the amount you invest. The Distributor also pays your broker's employer
an annual fee of 1% of your Fund investment beginning one year after you
purchase your shares.

RULE 12b-1 FEES. Class C shares are subject to a Rule 12b-1 account
maintenance fee of 0.25% per year of the average daily net assets of Class C and
a Rule 12b-1 distribution fee of 0.75% per year of the average daily net assets
of Class C. See "Management of the Funds--Distributor; Rule 12b-1 Distribution
Plans." The higher Rule 12b-1 fee will cause Class C shares to have a higher
expense ratio and to pay lower dividends than Class A shares.

As between Class B and Class C shares, if you anticipate an investment in a
Fund of longer than six years (the CDSC period applicable to Class B shares),
you may conclude that Class B shares are preferable to Class C shares because
the Class B shares will automatically convert to Class A shares (to which lower
Rule 12b-1 fees apply) after eight years. However, if you anticipate an
investment time frame of less than six years (or an uncertain time frame) you
may choose Class C shares because of the larger and longer-term CDSC applicable
to Class B shares.

GROWTH FUND CLASS I SHARES--LIMITED PURCHASER CLASS

GROWTH FUND'S CLASS I SHARES ARE NOT GENERALLY AVAILABLE FOR SALE TO THE
PUBLIC. You may purchase Growth Fund's Class I shares only if you:

- were a shareholder of Growth Fund on December 28, 1995 and have continued
to be a shareholder in one or more of the Funds ever since; or

- are a director, officer, employee or consultant to the Fund (including a
partner or employee of the Fund's legal counsel), the Investment Adviser
or the Distributor, an immediate family

20
<PAGE>
member of such a person, or a lineal ancestor (parent, grandparent, etc.)
or descendant (child, grandchild, etc.) of such a person.

Accounts benefitting any of such persons also may purchase Class I shares.

Growth Fund's Class I shares are sold at their net asset value next
determined after an order is received plus the applicable FESC. Growth Fund
receives the net asset value. The current FESC schedule, which varies with the
amount of the investment, and the allocation of the FESC between the Distributor
and your broker's employer, are the same as set forth for Class A shares. See
"Class A Shares--Initial Sales Charge Alternative." Growth Fund's Class I shares
are not subject to any Rule 12b-1 fees.

WAIVER OF SALES CHARGES. The FESC is not imposed on investments in Growth
Fund's Class I shares by any category of investors qualifying for FESC waivers
with respect to Class A shares. See "Class A Shares--Initial Sales Charge
Alternative--Waiver of Sales Charges." The FESC also is not imposed on
investments in Growth Fund's Class I shares by directors, officers, employees or
consultants to the Fund, the Investment Adviser or the Distributor, immediate
family members of such persons, lineal ancestors or descendants of such persons,
or accounts benefitting any of these persons.

SPECIAL PURCHASE PLANS--REDUCED SALES CHARGES. Certain investors (or groups
of investors) may qualify for reductions in, or waivers of, the sales charges on
Growth Fund Class I Shares. You should contact your broker or the Funds for
details about the Combined Purchase Privilege, Cumulative Quantity Discount and
Letter of Intention plans. Descriptions are also included in the attached
general authorization form and in the Statement of Additional Information. The
Distributor may amend or eliminate these special purchase plans at any time
without notice.

HOW TO REDEEM YOUR FUND SHARES

You normally may redeem your Fund shares on any business day at their net
asset value (minus any applicable CDSC) next determined after the Fund has
received your redemption request in good order. The Funds normally make payment
within three days thereafter. However, if you very recently purchased such
shares by personal check, your redemption payment may be delayed (typically for
not more than 15 days) to permit your check to clear.

If you own more than one Class of a Fund's shares, you should specify the
Class or Classes of shares being redeemed. The value of shares redeemed may be
more or less than their original cost depending upon their net asset value at
the time of redemption.

You may not redeem your Fund shares on any day that the New York Stock
Exchange is closed (normally, weekends and national holidays). The Funds also
may suspend your right of redemption if permitted by applicable laws and rules
that are designed to protect Fund shareholders (for example, when emergencies or
restrictions in the securities markets make it difficult or impossible for the
Funds to determine their net asset values or to sell their investments in an
orderly manner).

If redemptions cause any of your Fund accounts to fall below $1,000, and the
account remains below $1,000 for 60 days after the Fund notifies you in writing,
the Fund may close your account and mail you a check for your account balance.

21
<PAGE>
SIGNATURE GUARANTEES

Your request to sell shares must be made in writing and include a signature
guarantee if any of the following situations apply:

- You request to redeem more than $50,000 worth of shares.

- Your account registration or address has changed within the last 30 days.

- The check is being mailed to a different address than the one on your
account.

- The check is being made payable to someone other than the account owner.

- The redemption or exchange proceeds are being transferred to an account
with a different registration.

You should be able to obtain a signature guarantee from a bank,
broker-dealer, credit union (if authorized under state law), securities exchange
or association, clearing agency or savings association. A NOTARY PUBLIC CANNOT
PROVIDE A SIGNATURE GUARANTEE.

CONTINGENT DEFERRED SALES CHARGE

Any applicable CDSCs will be calculated and based on the lesser of the net
asset value of the shares at the time of purchase or at the time of redemption.
No CDSC will be imposed on any redeemed shares that represent reinvestment of
distributions. The CDSC calculation will be determined in the manner that
results in the lowest rate being charged. Therefore, it will be assumed that a
redemption of Class B or Class C shares is made first of shares representing
reinvestment of distributions and then of remaining shares held by the
shareholder for the longest period of time. If you own Class A and Class B
shares, then unless you choose otherwise, your Class B shares not subject to a
CDSC will be redeemed in full prior to any redemption of your Class A shares not
subject to a CDSC. The CDSC will not be imposed: (a) when a Fund closes accounts
with balances under $1,000; (b) on redemptions when the shareholder dies or
becomes disabled (within the meaning of Section 72(m)(7) of the Internal Revenue
Code); and (c) on minimum distributions from IRAs processed under systematic
withdrawal plans.

REINSTATEMENT PRIVILEGE

The Distributor will credit back to your account that proportion of any CDSC
that you paid in connection with a redemption of Fund shares if, within 90 days
after such redemption, all or any portion of your redemption proceeds are
reinvested in shares of the same Class of any of the Funds. YOU MUST NOTIFY THE
FUND OF YOUR ELIGIBILITY FOR THIS CREDIT. The shares you receive at the time of
such reinvestment will be subject to the same CDSC to which such shares were
subject prior to the redemption. The CDSC period will run from the original
investment date but will be extended by the number of days between the
redemption date and the reinvestment date.

EXCHANGE PRIVILEGE

Except as provided below, you may exchange some or all of your Fund shares
for shares of equal value of the same class of another Fund. If your own Class A
or Class I shares of a Fund, you may exchange them for Class A shares (or Class
I shares, if you are eligible to purchase Class I shares) of another Fund.

22
<PAGE>
The minimum amount which you may exchange is $1,000. If you exchange shares
that are subject to a CDSC, the CDSC will not be charged when the exchange is
made. However, the acquired shares will be subject to the same CDSC as the
shares exchanged (as if no exchange had occurred). The Distributor may restrict
the frequency of, or otherwise modify, condition, terminate or impose charges
upon, exchanges. An exchange is considered a sale of shares on which you may
realize a capital gain or loss for income tax purposes. If you are considering
an exchange, you should obtain a prospectus of the Fund whose shares you wish to
acquire, and should read it carefully.

EXPEDITED TELEPHONE REDEMPTIONS

The Funds currently offer certain expedited redemption procedures. The
Transfer Agent charges a fee for wire transfers. If you are redeeming shares
worth at least $1,000 but not more than $25,000, you may redeem by calling the
Funds at 1-800-370-0612. You must have completed the applicable section of the
attached general authorization form before the telephone request is received.
The Funds will employ reasonable procedures to confirm that telephone
instructions are genuine, including requiring that payment be made only to your
address of record or to the bank account designated on the authorization form
and requiring certain means of telephonic identification. If a Fund fails to
employ such procedures, it may be liable for any losses suffered by you as a
result of fraudulent instructions. The proceeds of the redemption will be paid
by check mailed to your address of record or, if requested at the time of
redemption, by wire to the bank designated on the authorization form.

Your broker may allow you to effect an expedited redemption of Fund shares
purchased through your broker by notifying him or her of the amount of shares to
be redeemed. Your broker is then responsible for promptly placing the redemption
request with the Fund on your behalf.

MONTHLY CASH WITHDRAWAL PLAN

If you own Fund shares valued at $10,000 or more, you may open a Withdrawal
Plan and have a designated amount of money paid monthly to you or another
person. Contact the Funds for additional information.

DETERMINATION OF NET ASSET VALUE

The net asset value of each Class of each Fund's shares is determined once
daily as of 15 minutes after the close of business on the New York Stock
Exchange (generally 4:00 p.m., New York time) on each day the Exchange is open
for trading. The net asset value is computed by dividing the market value of the
securities held by the Fund attributable to the Class plus other assets
(including income accruals and other receivables) attributable to the Class
minus all liabilities (including expense accruals) attributable to the Class by
the total number of shares of such Class outstanding at such time.

23
<PAGE>
recent quoted asked price. Securities and assets for which market quotations are
not readily available are valued at fair value as determined in good faith by
the Board of Directors or by the Investment Adviser in accordance with policies
and procedures established by the Board of Directors. Short-term investments
that mature in 60 days or less are valued at amortized cost, which approximates
fair value.

DIVIDENDS, OTHER DISTRIBUTIONS AND TAXES

DIVIDENDS AND OTHER DISTRIBUTIONS

Substantially all of each Fund's net investment income and net capital
gains, if any, will be paid to investors once a year. You may elect to receive
distributions in cash or in additional Fund shares (of the same Class of shares
to which the distribution relates). If you do not indicate a choice, your
distributions will be reinvested in Fund shares.

TAXES

Each Fund seeks to qualify as a "regulated investment company" under the
Internal Revenue Code. If so qualified, each Fund will not be subject to federal
income taxes to the extent its earnings are distributed on a timely basis. Each
Fund also intends to make distributions as required by the Internal Revenue Code
to avoid the 4% federal excise tax.

Distributions to you from a Fund's income and short-term capital gains will
be taxed at "ordinary income" rates. Long-term capital gain distributions will
be taxed at applicable long-term capital gains rates regardless of the length of
time you have held your Fund shares. A portion of a Fund's dividends may qualify
for the dividends received deduction for corporations. A Fund's distributions
will be taxable when they are paid, whether you take them in cash or reinvest
them in additional Fund shares, except that distributions declared in December
but paid in January are taxable as if paid on or before December 31. The federal
income tax status of all distributions will be reported to you annually. In
addition to federal income taxes, distributions may also be subject to state or
local taxes, and if you live outside the United States, the dividends and other
distributions could also be taxed by the country in which you live.

"BUYING A DISTRIBUTION"

On the date of a distribution by a Fund, the price of its shares is reduced
by the amount of the distribution. If you purchase shares of a Fund on or before
the record date ("buying a distribution"), you will pay the full price for the
shares (which includes realized but undistributed earnings and capital gains of
the Fund that accumulate throughout the year), and then receive a portion of the
purchase price back in the form of a taxable distribution. For this reason, most
taxable investors avoid buying Fund shares at or near the time of a large
distribution.

OTHER TAX INFORMATION

Under federal tax law, some shareholders may be subject to a 31% withholding
on reportable dividends, capital gains distributions and redemption payments
("backup withholding"). Generally, shareholders subject to backup withholding
will be those for whom a taxpayer identification number is not on file with the
Funds or any of its agents or who, to the Funds' or agent's knowledge, have
furnished an incorrect number. In order to avoid this withholding requirement,
you must certify that

24
<PAGE>
the taxpayer identification number provided is correct and that the investment
is not otherwise subject to backup withholding, or is exempt from backup
withholding.

THE FOREGOING TAX DISCUSSION IS GENERAL IN NATURE, AND YOU ARE ADVISED TO
CONSULT YOU TAX ADVISER REGARDING SPECIFIC QUESTIONS AS TO FEDERAL, STATE, LOCAL
OR FOREIGN TAXATION.

PERFORMANCE INFORMATION

Advertisements and other materials sent to investors may contain various
measures of the Funds' performance, including various expressions of total
return. Additionally, such advertisements and communications may occasionally
cite statistics to reflect the Funds' volatility or risk. Performance for each
Class of Fund shares may be calculated on the basis of average annual total
return and/ or cumulative total return. These total return figures reflect
changes in the price of the shares and assume that any distributions made by a
Fund during the measuring period were reinvested in shares of the same Class.

Cumulative total return represents the actual rate of return on an
investment for a specified period. The Financial Highlights Tables show total
return for a single fiscal period. Cumulative total return is generally quoted
for more than one year (E.G., the life of a Fund). Cumulative total return does
not show interim fluctuations in the value of an investment.

Average annual total return represents the average annual percentage change
of an investment over a specified period. It is calculated by taking the
cumulative total return for the stated period and determining what consistent
annual return would have produced the same cumulative total return. Average
annual total returns for more than one year tend to smooth out variations in a
Fund's return and are not the same as actual annual results.

In each case performance figures are based upon past performance. The
investment results of each Fund, like all other mutual funds, will fluctuate
over time; thus, performance figures should not be considered to represent what
an investment may earn in the future or what a Fund's total return or average
annual total return may be in any period.

The Funds' performance from time to time in reports or promotional
literature may be compared to generally accepted indices or analyses such as
those published by Lipper Analytical Service, Inc., Standard & Poor's
Corporation, The Frank Russell Company, Dow Jones & Company, Inc., CDA
Investment Technologies, Inc., Morningstar, Inc. and Investment Company Data
Incorporated. Performance ratings reported periodically in national financial
publications also may be used.

The Funds' Annual Report will contain certain performance information
regarding the Funds and will be made available to you free upon request.

GENERAL INFORMATION

Growth Fund and Jundt Funds, Inc. were organized as Minnesota corporations
on May 20, 1991 and October 26, 1995, respectively. Although Growth Fund and
Jundt Funds, Inc. are registered with the Securities and Exchange Commission,
the SEC does not supervise their management or investments.

25
<PAGE>

such Class. Additionally, shares of each Fund vote together (with each share
being entitled to one vote) on matters affecting the Fund generally (such as the
Fund's investment advisory agreement, fundamental investment policies and
similar matters). However, shares of each Class of a Fund generally vote alone
on matters affecting only such Class, such as such Class' Rule 12b-1 plan. In
addition, shares of all Classes of Emerging Fund, Opportunity Fund and
Twenty-Five Fund generally vote together (with each share being entitled to one
vote) with respect to the Board of Directors, independent auditors and other
general matters affecting Jundt Funds, Inc. Each Fund's shares are freely
transferable. The Board of Directors may designate additional classes of shares
of each Fund, each with different sales arrangements and expenses, but has no
current intention of doing so. In addition, the Board of Directors may designate
additional series of Jundt Funds, Inc., each to represent a new mutual fund.

The Funds are not required, and therefore do not intend, to hold annual or
periodic shareholder meetings. The Board of Directors may decide to call a
meeting at any time, and the Funds may be required by Minnesota or federal law
to hold shareholder meetings in certain circumstances.

Under Minnesota law, the Board of Directors has overall responsibility for
managing the Funds. In doing so, they must act in good faith, in the Funds' best
interests and with ordinary prudence. The Articles of Incorporation of Growth
Fund and Jundt Funds, Inc. limit the liability of officers and directors to the
fullest extent permitted by law.

For a further discussion of the above matters, see "General Information" in
the Statement of Additional Information.

26
<PAGE>
JUNDT GROWTH FUND
JUNDT U.S. EMERGING GROWTH FUND
JUNDT OPPORTUNITY FUND
JUNDT TWENTY-FIVE FUND
------------------------

PROSPECTUS
MAY 1, 1998
------------------------

TABLE OF CONTENTS

<TABLE>
<S> <C>
Summary of Risk Factors.............................................................. 2
Fees and Expenses.................................................................... 3
Financial Highlights................................................................. 7
Investment Objectives and Policies................................................... 10
Management of the Funds.............................................................. 14
How to Buy Fund Shares............................................................... 17
How to Redeem Your Fund Shares....................................................... 21
Determination of Net Asset Value..................................................... 23
Dividends, Other Distributions and Taxes............................................. 24
Performance Information.............................................................. 25
General Information.................................................................. 25
</TABLE>

INVESTMENT ADVISER TRANSFER AGENT
Jundt Associates, Inc. Investors Fiduciary Trust Company
1550 Utica Avenue South, Suite 950 330 West 9th Street
Minneapolis, Minnesota 55416 Kansas City, Missouri 64105
DISTRIBUTOR CUSTODIAN
U.S. Growth Investments, Inc. Norwest Bank Minnesota, N.A.
1550 Utica Avenue South, Suite 950 Sixth and Marquette
Minneapolis, Minnesota 55416 Minneapolis, Minnesota 55479
ADMINISTRATOR INDEPENDENT AUDITORS
Princeton Administrators, L.P. KPMG Peat Marwick LLP
P.O. Box 9095 99 High Street
Princeton, New Jersey 08543 Boston, Massachusetts 02110

LEGAL COUNSEL
Faegre & Benson LLP
2200 Norwest Center
Minneapolis, Minnesota 55402
------------------------

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE JUNDT GROWTH FUND, INC., JUNDT FUNDS, INC., THE INVESTMENT
ADVISER OR THE DISTRIBUTOR. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO
SELL, OR THE SOLICITATION OF AN OFFER TO BUY, SHARES OF ANY FUND IN ANY STATE OR
JURISDICTION IN WHICH SUCH OFFERING OR SOLICITATION MAY NOT LAWFULLY BE MADE.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL CREATE
ANY IMPLICATION THAT INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE HEREOF.

<PAGE>
JUNDT GROWTH FUND
JUNDT U.S. EMERGING GROWTH FUND
JUNDT OPPORTUNITY FUND
JUNDT TWENTY-FIVE FUND

1550 UTICA AVENUE SOUTH, SUITE 950
MINNEAPOLIS, MINNESOTA 55416
1-800-370-0612

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

The Jundt Growth Fund, Inc. ("Growth Fund"), Jundt U.S. Emerging Growth Fund
("Emerging Fund"), Jundt Opportunity Fund ("Opportunity Fund") and Jundt
Twenty-Five Fund ("Twenty-Five Fund") (collectively, the "Funds") are
professionally managed mutual funds. Investors in each Fund become Fund
shareholders. Each Fund offers its shares in four classes (Classes A, B, C and
I), each subject to different selling and other expenses. This prospectus
relates to each Fund's Class I shares (which are available only to certain
investors).

Each Fund's investment objective is long-term capital appreciation. However,
each Fund employs its own investment strategy and therefore involves different
risks.

- GROWTH FUND is a diversified fund that maintains a core portfolio of 30 to
50 stocks of primarily medium-size to larger American growth companies.

- EMERGING FUND is a diversified fund that maintains a core portfolio of 30
to 50 stocks of primarily American emerging growth companies.

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

PROSPECTUS DATED MAY 1, 1998

(CLASS I SHARES ONLY)

<PAGE>
SUMMARY OF RISK FACTORS

While mutual funds are a convenient and potentially rewarding way to invest,
they do not always meet their objectives. Please remember that you could lose
money with these investments.

The risks of investing in each Fund are more fully explained under
"Investment Objectives and Policies" below.

2
<PAGE>

FEES AND EXPENSES

The following table illustrates the expenses and fees you would incur as an
investor in Class I shares of each Fund and is designed to assist you in making
investment decisions. Of course, if you are contemplating an investment in a
Fund, you should also consider other relevant factors, including the Fund's
investment objective and historical performance.

<TABLE>
<CAPTION>
GROWTH EMERGING OPPORTUNITY TWENTY-FIVE
FUND FUND FUND FUND
------ -------- ----------- -----------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Sales Charge Imposed on Purchases....... NONE(a) NONE NONE NONE
Sales Charge Imposed on Dividend Reinvestments.. NONE NONE NONE NONE
Maximum Deferred Sales Load(b).................. NONE(a) NONE NONE NONE
Redemption Fees(b) and Exchange Fees............ NONE NONE NONE NONE
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF
AVERAGE NET ASSETS):
Investment Advisory Fees(c)..................... 1.00% 1.00% 1.30% 1.30%
Rule 12b-1 Fees................................. NONE NONE NONE NONE
Other Expenses (after reimbursements)(d)........ 0.93% 0.55% 0.59% 0.70%
------ -------- ----------- -----------
TOTAL FUND OPERATING EXPENSES (AFTER
REIMBURSEMENTS)(d) . . 1.93% 1.55% 1.89% 2.00%
------ -------- ----------- -----------
------ -------- ----------- -----------
</TABLE>

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

(a) Class I shares of Growth Fund are also offered, in a separate prospectus, to
persons that were shareholders on December 28, 1995 and that have continued
to be shareholders in one or more of the Funds ever since (and accounts
benefitting such persons); however, these persons are required to pay a
front-end sales charge of up to 5.25% of the offering price at the time of
purchase or, if their investment is for $1 million or more, their shares are
subject to a contingent deferred sales charge of up to 1% at the time of
redemption.

(b) Service agents and brokers may charge a nominal fee for effecting
redemptions of Fund shares.

(c) The investment advisory fee paid by each Fund is higher than the investment
advisory fee paid by most other mutual funds.

(d) The Investment Adviser has voluntarily agreed to reimburse Emerging Fund,
Opportunity Fund and Twenty-Five Fund for Fund operating expenses in excess
of the percentages indicated in the above tables during the year ending
December 31, 1998. Thereafter, the Investment Adviser may discontinue or
modify such reimbursements. Other Expenses and Total Fund Operating Expenses
for Class I shares for the year ended December 31, 1997 would have been
approximately 2.10% and 3.10%, respectively, for Emerging Fund, and 5.02%
and 6.32%, respectively, for Opportunity Fund. Absent voluntary expense
reimbursements, Other Expenses and Total Fund Operating Expenses for
Twenty-Five Fund's Class I shares for the year ending December 31, 1998 are
estimated to be approximately 2.42% and 3.72%, respectively.

3
<PAGE>

EXAMPLES:

The following examples illustrates the expenses you would incur on a $1,000
investment over various periods, assuming a 5% annual return and redemption at
the end of each period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Growth Fund Class I...................................... $ 20 $ 61 $ 104 $ 225
Emerging Fund Class I.................................... 16 49 84 188
Opportunity Fund Class I................................. 19 59 102 221
Twenty-Five Fund Class I................................. 20 63 N/A N/A
</TABLE>

The purpose of the fee and expense information set forth above is to assist
you in understanding the various costs and expenses that you would bear directly
or indirectly in each Fund's Class I shares. You will find more detailed
information about these expenses under "Management of the Fund." The Annual Fund
Operating Expenses for Growth Fund, Emerging Fund and Opportunity Fund are based
on actual expenses for the year ended December 31, 1997. The Annual Fund
Operating Expenses for Twenty-Five Fund represents management's good faith
estimate of Fund expenses (after voluntary expense reimbursements) for the year
ending December 31, 1998. THE FOREGOING INFORMATION SHOULD NOT BE CONSIDERED
REPRESENTATIONS OF PAST OR FUTURE RETURNS OR EXPENSES WHICH MAY BE HIGHER OR
LOWER THAN THOSE SHOWN.

4
<PAGE>
FINANCIAL HIGHLIGHTS

The following Financial Highlights of the Funds' Class I shares have been
audited by KPMG Peat Marwick LLP, the Funds' independent auditors, whose report
thereon was unqualified. You should read the Financial Highlights in conjunction
with the financial statements of the Funds, including the notes and the
independent auditor's report, included in the 1997 Annual Report to
Shareholders. The Annual Report also contains further information about the
performance of the Funds. You may obtain copies without charge by calling the
Funds at 1-800-370-0612. The Annual Report is incorporated by reference in the
Statement of Additional Information and in this Prospectus. Prior to December
29, 1995, Growth Fund operated as a closed-end investment company.

GROWTH FUND

<TABLE>
<CAPTION>
YEAR ENDED
YEAR ENDED DECEMBER 31, PERIOD FROM JUNE 30, PERIOD FROM
----------------------------------- 7/1/94 TO ----------------------- 9/3/91* TO
PER SHARE DATA 1997 1996 1995 12/31/94 1994 1993 6/30/92
- ----------------------------------- -------- -------- --------- ----------- --------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period........................... $ 13.69 $ 11.95 $ 14.95 $ 13.53 $ 15.10 $ 13.78 $ 14.07
-------- -------- --------- ----------- --------- --------- -----------
Operations:
Net investment income (loss)..... (0.19) (0.23) (0.12) (0.07) (0.11) (0.05) 0.13
Net realized and unrealized gain
(loss) on investments and
futures transactions........... 1.63 2.05 2.71 1.83 (0.57) 1.38 (0.30)
-------- -------- --------- ----------- --------- --------- -----------
Total from operations.............. 1.44 1.82 2.59 1.76 (0.68) 1.33 (0.17)
Distributions to shareholders:
From investment income--net...... -- -- -- -- -- (0.01) (0.12)
From realized capital
gains--net..................... (0.85) (0.08) (5.59) -- (0.52) -- --
Tax return of capital.............. -- -- -- (0.34) (0.37) -- --
-------- -------- --------- ----------- --------- --------- -----------
Net asset value, end of period..... $ 14.28 $ 13.69 $ 11.95 $ 14.95 $ 13.53 $ 15.10 $ 13.78
-------- -------- --------- ----------- --------- --------- -----------
-------- -------- --------- ----------- --------- --------- -----------
Total investment return(1)......... 10.85% 15.22% 17.81% 13.06% (4.53)% 9.64% (1.30)%
Net assets at end of period (000s
omitted)......................... $ 80,964 $ 96,458 $ 140,642 $223,317 $ 202,192 $ 473,768 $465,055
Ratio of expenses to average net
assets........................... 1.93% 1.88% 1.60% 1.58%+ 1.55% 1.40% 1.37%+
Ratio of net investment income
(loss) to average net assets..... (1.22)% (1.56)% (0.72)% (0.98)%+ (0.63)% (0.36)% 1.05%+
Portfolio turnover rate (excluding
short-term securities)........... 115% 57% 155% 19% 70% 66% 20%
Average commission per share(2).... $ 0.0600 $ .0599 N/A N/A N/A N/A N/A
-------- -------- --------- ----------- --------- --------- -----------
-------- -------- --------- ----------- --------- --------- -----------
</TABLE>

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

* Commencement of operations.

(2) For fiscal years beginning in 1996, Growth Fund is required to disclose its
average commission rate per share for purchases and sales of investment
securities subject to a commission.

+ Adjusted to an annual basis.

5
<PAGE>

EMERGING FUND

<TABLE>
<CAPTION>
YEAR ENDED PERIOD FROM 1/2/96
PER SHARE DATA 12/31/97 TO 12/31/96*
- -------------------------------------------------- ---------- -------------------
<S> <C> <C>
Net asset value, beginning of period.............. $ 12.51 $ 10.00
---------- --------
Operations:
Investment loss--net............................ (0.07) (0.11)
Net realized and unrealized gain (loss) on
investments and futures transactions.......... 4.12 4.53
---------- --------
Total from operations............................. 4.05 4.42
Distributions to shareholders:
From realized capital gains--net................ (3.31) (1.91)
---------- --------
Net asset value, end of period.................... $ 13.25 $ 12.51
---------- --------
---------- --------
Total investment return(1)........................ 33.87% 44.32%
Net assets at end of period (000s omitted)........ $ 11,773 $ 9,025
Ratio of expenses, before reimbursements, to
average net assets.............................. 3.10% 3.44%+
Ratio of expenses, net of reimbursements, to
average net assets.............................. 1.55% 1.55%+
Ratio of net investment loss to average net
assets.......................................... (0.63)% (1.09)%+
Portfolio turnover rate (excluding short-term
securities)..................................... 264% 204%
Average commission per share...................... $ 0.0600 $0.0600
---------- --------
---------- --------
</TABLE>

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

* Commencement of operations.

+ Adjusted to an annual basis.

6
<PAGE>

OPPORTUNITY FUND

<TABLE>
<CAPTION>
YEAR ENDED PERIOD FROM 12/26/96
PER SHARE DATA 12/31/97 TO 12/31/96*
- -------------------------------------------------- ---------- ---------------------
<S> <C> <C>
Net asset value, beginning of period.............. $ 9.87 $ 10.00
---------- --------
Operations:
Investment loss--net............................ (0.14) --
Net realized and unrealized gain (loss) on
investments, futures transactions and short
sale transactions............................. 4.12 (0.13)
---------- --------
Total from operations............................. 3.98 (0.13)
Distributions to shareholders:
From realized capital gains--net................ (2.79) --
---------- --------
Net asset value, end of period.................... $ 11.06 $ 9.87
---------- --------
---------- --------
Total investment return(1)........................ 41.45% (1.30)%
Net assets at end of period (000s omitted)........ $ 3,973 $ 286
Ratio of expenses, before reimbursements, to
average net assets.............................. 6.70% 3.98%+
Ratio of expenses, excluding interest expense, to
average net assets.............................. 6.32% 3.98%+
Ratio of expenses, net of reimbursements and
excluding interest expense, to average net
assets.......................................... 1.89% 1.89%+
Ratio of net investment loss to average net
assets.......................................... (1.56)% (1.89)%+
Portfolio turnover rate (excluding short-term
securities)..................................... 298% 0%
Average commission per share(2)................... $ 0.0600 N/A
---------- --------
---------- --------
</TABLE>

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

* Commencement of operations.

+ Adjusted to an annual basis.

(2) For fiscal year ended December 31, 1998, Opportunity Fund did not incur
commissions as a result of securities being purchased in the
over-the-counter market.

7
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES

INVESTMENT OBJECTIVE

INVESTMENT POLICIES AND RISK CONSIDERATIONS

In pursuing its investment objective, each Fund employs its own investment
strategy and policies. An investment in each Fund, therefore, involves different
risks.

8
<PAGE>
growth in revenue and earnings. The Investment Adviser believes that such
companies offer investors the greatest potential for long-term capital
appreciation. The Investment Adviser uses a long-term fundamental approach in
identifying such companies. A "fundamental" approach includes looking at a
company's revenue and earnings growth, competitive advantages, management and
market opportunities and evaluating whether its stock is fairly valued at the
current market price. In general, the Investment Adviser selects investments
without regard to industry sectors and other defined selection procedures.

9
<PAGE>

10
<PAGE>

correlate perfectly with the changes in the market value of the securities
subject to a hedge. As a result, even a correct market forecast could result in
an unsuccessful hedging transaction.

11
<PAGE>

INVESTMENT RESTRICTIONS

BROKERAGE AND PORTFOLIO TRANSACTIONS

Consistent with the rules and regulations of the National Association of
Securities Dealers, Inc., the Investment Adviser may consider distribution of
Fund shares when choosing broker-dealers.

MANAGEMENT OF THE FUNDS

12
<PAGE>
INVESTMENT ADVISER

PORTFOLIO MANAGERS

13
<PAGE>

ADMINISTRATOR

DISTRIBUTOR

U.S. Growth Investments, Inc. (the "Distributor"), a firm owned by James R.
Jundt, serves as the distributor for each Fund. There are no Rule 12b-1 plans or
expenses affecting any Fund's Class I shares.

The Distributor may pay certain cash incentives of up to $100 and/or non
cash incentives to its investment executives and other authorized firms. In some
instances, other incentives may be made available only to selected
broker-dealers and financial institutions, based on certain objective standards.
In addition, the Distributor may pay additional amounts to qualifying
broker-dealers or firms for certain services or activities which are primarily
intended to result in sales of Fund shares.

TRANSFER AGENT, DIVIDEND DISBURSING AGENT AND CUSTODIAN; SUBACCOUNTING AGENTS

HOW TO BUY FUND SHARES

Each Fund's Class I shares are being offered in this prospectus only to
directors, officers, employees or consultants to the Fund (including partners
and employees of the Fund's legal counsel), the Investment Adviser and the
Distributor, immediate family members of such persons, and a lineal ancestor
(parents, grandparents, etc.) and descendants (children, grandchildren, etc.) of
such persons. Accounts benefitting any of such persons may also purchase Class I
shares.

Each Fund's Class I shares are sold to such persons at their net asset value
next determined after an order is received. The applicable Fund receives the
entire net asset value per share.

14
<PAGE>

AUTOMATIC INVESTMENT PLAN. You may make automatic monthly investments
through each Fund's Automatic Investment Plan. For additional information, call
your broker or the Funds.

HOW TO REDEEM YOUR FUND SHARES

You normally may redeem your Fund shares on any business day at their net
asset value next determined after the Fund has received your redemption request
in good order. The Funds normally make payment within three days thereafter.
However, if you very recently purchased such shares by personal check, your
redemption payment may be delayed (typically for not more than 15 days) to
permit your check to clear.

The value of shares redeemed may be more or less than their original cost
depending upon their net asset value at the time of redemption.

15
<PAGE>
SIGNATURE GUARANTEES

Your request to sell shares must be made in writing. Additionally, a
signature guarantee may be required if any of the following situations apply:

- You request to redeem more than $50,000 worth of shares.

- Your account registration or address has changed within the last 30 days.

- The check is being mailed to a different address than the one on your
account.

- The check is being made payable to someone other than the account owner.

- The redemption or exchange proceeds are being transferred to an account
with a different registration.

EXCHANGE PRIVILEGE

Except as provided below, you may exchange some or all of your Class I Fund
shares for Class I shares of equal value of another Fund.

The minimum amount which you may exchange is $1,000. The Distributor may
restrict the frequency of, or otherwise modify, condition, terminate or impose
charges upon, exchanges. An exchange is considered a sale of shares on which you
may realize a capital gain or loss for income tax purposes. If you are
considering an exchange, you should obtain a prospectus of the Fund whose shares
you wish to acquire, and should read it carefully.

EXPEDITED TELEPHONE REDEMPTIONS

16
<PAGE>
MONTHLY CASH WITHDRAWAL PLAN

DETERMINATION OF NET ASSET VALUE

The net asset value of each Fund's shares is determined once daily as of 15
minutes after the close of business on the New York Stock Exchange (generally
4:00 p.m., New York time) on each day the Exchange is open for trading. The net
asset value is computed by dividing the market value of the securities held by
the Fund attributable to the Class plus other assets (including income accruals
and other receivables) attributable to the Class minus all liabilities
(including expense accruals) attributable to the Class by the total number of
shares of such Class outstanding at such time.

Securities which are traded on an exchange or on the NASDAQ National Market
System are valued at the last sale price on the exchange or market as of the
close of business on the valuation date. Securities for which there were no
sales on the date of valuation and securities traded on other over-the-counter
markets, including listed securities for which the primary market is believed to
be over-the-counter, are valued at the average of the most recent bid and asked
prices. Options are valued at market value or fair value if no market exists.
Futures contracts are valued in a like manner, except that open futures contract
sales are valued using the closing settlement price or, if none, the most recent
quoted asked price. Securities and assets for which market quotations are not
readily available are valued at fair value as determined in good faith by the
Board of Directors or by the Investment Adviser in accordance with policies and
procedures established by the Board of Directors. Short-term investments that
mature in 60 days or less are valued at amortized cost, which approximates fair
value.

DIVIDENDS, OTHER DISTRIBUTIONS AND TAXES

DIVIDENDS AND OTHER DISTRIBUTIONS

Substantially all of each Fund's net investment income and net capital
gains, if any, will be paid to investors once a year. You may elect to receive
distributions in cash or in additional Class I shares. If you do not indicate a
choice, your distributions will be reinvested in Fund shares.

TAXES

17
<PAGE>
before December 31. The federal income tax status of all distributions will be
reported to you annually. In addition to federal income taxes, distributions may
also be subject to state or local taxes, and if you live outside the United
States, the dividends and other distributions could also be taxed by the country
in which you live.

"BUYING A DISTRIBUTION"

OTHER TAX INFORMATION

THE FOREGOING TAX DISCUSSION IS GENERAL IN NATURE, AND YOU ARE ADVISED TO
CONSULT YOU TAX ADVISER REGARDING SPECIFIC QUESTIONS AS TO FEDERAL, STATE, LOCAL
OR FOREIGN TAXATION.

PERFORMANCE INFORMATION

18
<PAGE>
In each case performance figures are based upon past performance. The
investment results of each Fund, like all other mutual funds, will fluctuate
over time; thus, performance figures should not be considered to represent what
an investment may earn in the future or what a Fund's total return or average
annual total return may be in any period.

The Funds' Annual Report will contain certain performance information
regarding the Funds and will be made available to you free upon request.

GENERAL INFORMATION

Shares of each Class of a Fund generally have the same voting, dividend,
liquidation and other rights. However, expenses relating to the distribution of
each Class (Rule 12b-1 fees) are paid solely by such Class. Additionally, shares
of each Fund vote together (with each share being entitled to one vote) on
matters affecting the Fund generally (such as the Fund's investment advisory
agreement, fundamental investment policies and similar matters). However, shares
of each Class of a Fund generally vote alone on matters affecting only such
Class, such as such Class' Rule 12b-1 plan. In addition, shares of all Classes
of Emerging Fund, Opportunity Fund and Twenty-Five Fund generally vote together
(with each share being entitled to one vote) with respect to the Board of
Directors, independent auditors and other general matters affecting Jundt Funds,
Inc. Each Fund's shares are freely transferable. The Board of Directors may
designate additional classes of shares of each Fund, each with different sales
arrangements and expenses, but has no current intention of doing so. In
addition, the Board of Directors may designate additional series of Jundt Funds,
Inc., each to represent a new mutual fund.

For a further discussion of the above matters, see "General Information" in
the Statement of Additional Information.

19
<PAGE>
JUNDT GROWTH FUND
JUNDT U.S. EMERGING GROWTH FUND
JUNDT OPPORTUNITY FUND
JUNDT TWENTY-FIVE FUND
------------------------

PROSPECTUS (CLASS I ONLY)
MAY 1, 1998

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

TABLE OF CONTENTS

<TABLE>
<S> <C>
Summary of Risk Factors.............................................................. 2
Fees and Expenses.................................................................... 3
Financial Highlights................................................................. 5
Investment Objectives and Policies................................................... 8
Management of the Funds.............................................................. 12
How to Buy Fund Shares............................................................... 14
How to Redeem Your Fund Shares....................................................... 15
Determination of Net Asset Value..................................................... 17
Dividends, Other Distributions and Taxes............................................. 17
Performance Information.............................................................. 18
General Information.................................................................. 19
</TABLE>

LEGAL COUNSEL
Faegre & Benson LLP
2200 Norwest Center
Minneapolis, Minnesota 55402
------------------------

<PAGE>

THE JUNDT FUNDS, INC.

REGISTRATION STATEMENT ON FORM N-1A

PART B

STATEMENT OF ADDITIONAL INFORMATION
<PAGE>
JUNDT GROWTH FUND
JUNDT U.S. EMERGING GROWTH FUND
JUNDT OPPORTUNITY FUND
JUNDT TWENTY-FIVE FUND

1550 UTICA AVENUE SOUTH, SUITE 950
MINNEAPOLIS, MINNESOTA 55416
1-800-370-0612

STATEMENT OF ADDITIONAL INFORMATION
DATED MAY 1, 1998

This Statement of Additional Information is not a prospectus and should be
read in conjunction with the Funds' Prospectus, dated May 1, 1998 (the
"Prospectus"), which has been filed with the Securities and Exchange Commission
(the "SEC"). To obtain a copy of the Prospectus, please call the Funds at
1-800-370-0612 or your investment executive.

TABLE OF CONTENTS

PAGE
----
Investment Policies....................................................... B-2
Investment Restrictions................................................... B-10
Taxes..................................................................... B-14
Advisory, Administrative and Distribution Agreements...................... B-15
Special Purchase Plans.................................................... B-19
Monthly Cash Withdrawal Plan.............................................. B-21
Determination of Net Asset Value.......................................... B-22
Calculation of Performance Data........................................... B-24
Directors and Officers.................................................... B-29
Counsel and Auditors...................................................... B-31
General Information....................................................... B-32
Financial and Other Information........................................... B-34

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS STATEMENT OF ADDITIONAL
INFORMATION OR IN THE PROSPECTUS, AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE JUNDT
GROWTH FUND, INC., JUNDT FUNDS, INC., ANY FUND OR THE FUNDS' INVESTMENT ADVISER
OR DISTRIBUTOR. NEITHER THIS STATEMENT OF ADDITIONAL INFORMATION NOR THE
PROSPECTUS CONSTITUTES AN OFFER TO SELL, OR THE SOLICITATION OF AN OFFER TO BUY,
SHARES OF ANY FUND IN ANY STATE OR JURISDICTION IN WHICH SUCH OFFERING OR
SOLICITATION MAY NOT LAWFULLY BE MADE. NEITHER THE DELIVERY OF THIS STATEMENT OF
ADDITIONAL INFORMATION NOR ANY SALE MADE HEREUNDER (OR UNDER THE PROSPECTUS)
SHALL CREATE ANY IMPLICATION THAT INFORMATION CONTAINED HEREIN IS CORRECT AS OF
ANY TIME SUBSEQUENT TO THE DATE HEREOF.

B-1
<PAGE>
INVESTMENT POLICIES

The Funds' investment objectives and policies are set forth in the
Prospectus. Certain additional investment information is set forth below.

OPTIONS

Each Fund may purchase and sell put and call options on its portfolio
securities to protect against changes in market prices. In addition, Opportunity
Fund and Twenty-Five Fund may purchase and sell options to generate additional
investment returns. There is no assurance that the use of put and call options
will achieve these desired objectives and could result in losses.

CALL OPTIONS. Each Fund may sell covered call options on its securities and
securities indices to realize a greater current return, through the receipt of
premiums, than it would realize on its securities alone. A call option gives the
holder the right to purchase, and obligates the seller to sell, a security at
the exercise price at any time before the expiration date. A call option is
"covered" if the seller, at all times while obligated as a seller, either owns
the underlying securities (or comparable securities satisfying the cover
requirements of the securities exchanges), or has the right to immediately
acquire such securities. In addition to covered call options, Opportunity Fund
and Twenty-Five Fund may sell uncovered (or "naked") call options; however, SEC
rules require that such Funds segregate assets on their books and records with a
value equal to the value of the securities or the index that the holder of the
option is entitled to call.

In return for the premiums received when it sells a covered call option, a
Fund gives up some or all of the opportunity to profit from an increase in the
market price of the securities covering the call option during the life of the
option. The Fund retains the risk of loss should the price of such securities
decline. If the option expires unexercised, the Fund realizes a gain equal to
the premium, which may be offset by a decline in price of the underlying
security. If the option is exercised, the Fund realizes a gain or loss equal to
the difference between the Fund's cost for the underlying security and the
proceeds of sale (exercise price minus commission) plus the amount of the
premium.

A Fund may terminate a call option that it has sold before it expires by
entering into a closing purchase transaction. The Fund may enter into closing
transactions in order to free itself to sell the underlying security or to sell
another call option on the security, realize a profit on a previously written
call option, or protect a security from being called in an unexpected market
rise. Any profits from a closing purchase transaction may be offset by a decline
in the value of the underlying security. Conversely, because increases in the
market price of a call option will generally reflect increases in the market
price of the underlying security, any loss resulting from a closing purchase
transaction is likely to be offset in whole or in part by unrealized
appreciation of the underlying security owned by the Fund.

PUT OPTIONS. Each Fund may sell covered put options in order to enhance its
current return. A put option gives the holder the right to sell, and obligates
the seller to buy, a security, or the notional value of an index, at the
exercise price at any time before the expiration date. A put option is "covered"
if the seller segregates permissible collateral equal to the price to be paid if
the option is exercised.

In addition to the receipt of premiums and the potential gains from
terminating such options in closing purchase transactions, a Fund also receives
interest on the cash and debt securities maintained to cover the exercise price
of the option. By writing a put option, the Fund assumes the risk that

B-2
<PAGE>
it may be required to purchase the underlying security for an exercise price
higher than its then current market value, resulting in a potential capital loss
unless the security later appreciates in value.

A Fund may terminate a put option that it has written before it expires by a
closing purchase transaction. Any loss from this transaction may be partially or
entirely offset by the premium received on the terminated option.

PURCHASING PUT AND CALL OPTIONS. Each Fund may also purchase put options to
protect portfolio holdings against a decline in market value. This protection
lasts for the life of the put option because the Fund, as a holder of the
option, may sell the underlying security or index at the exercise price
regardless of any decline in its market price. In order for a put option to be
profitable, the market price of the underlying security or index must decline
sufficiently below the exercise price to cover the premium and transaction costs
that the Fund must pay. These costs will reduce any profit the Fund might have
realized had it sold the underlying security instead of buying the put option.

Each Fund may purchase call options to hedge against an increase in the
price of securities that the Fund wants ultimately to buy. Such hedge protection
is provided during the life of the call option since the Fund, as holder of the
call option, is able to buy the underlying security (or an index representative
of the underlying security) at the exercise price regardless of any increase in
the underlying security's or index's market price. In order for a call option to
be profitable, the market price of the underlying security or index must rise
sufficiently above the exercise price to cover the premium and transaction
costs. These costs will reduce any profit the Fund might have realized had it
bought the underlying security at the time it purchased the call option.

Opportunity Fund and Twenty-Five Fund may also purchase put and call options
to enhance their current returns.

RISKS INVOLVED IN THE SALE OF OPTIONS. Options transactions involve certain
risks, including the risks that the Investment Adviser will not forecast market
movements correctly, that a Fund may be unable at times to close out such
positions, or that hedging transactions may not accomplish their purpose because
of imperfect market correlations.

An exchange-listed option may be closed out only on an exchange which
provides a secondary market for an option of the same series. There is no
assurance that a liquid secondary market on an exchange will exist for any
particular option or at any particular time. If no secondary market were to
exist, it would be impossible to enter into a closing transaction to close out
an option position. As a result, a Fund may be forced to continue to hold, or to
purchase at a fixed price, a security on which it has sold an option at a time
when the Investment Adviser believes it is inadvisable to do so.

Higher than anticipated trading activity or order flow or other unforeseen
events might cause The Options Clearing Corporation or an exchange to institute
special trading procedures or restrictions that might restrict the Funds' use of
options. The exchanges have established limitations on the maximum number of
calls and puts of each class that may be held or written by an investor or group
of investors acting in concert. It is possible that the Funds and other clients
of the Investment Adviser may be considered such a group. These position limits
may restrict a Fund's ability to purchase or sell options on particular
securities.

B-3
<PAGE>
Options which are not traded on national securities exchanges may be closed
out only with the other party to the option transaction. For that reason, it may
be more difficult to close out unlisted options than listed options.
Furthermore, unlisted options are not subject to the protection afforded
purchasers of listed options by The Options Clearing Corporation.

SPECIAL EXPIRATION PRICE OPTIONS

Each Fund may purchase over-the-counter ("OTC") put and call options with
respect to specified securities ("special expiration price options") pursuant to
which the Fund in effect may create a custom index relating to a particular
industry or sector that the Investment Adviser believes will increase or
decrease in value generally as a group. In exchange for a premium, the
counterparty, whose performance is guaranteed by a broker-dealer, agrees to
purchase (or sell) a specified number of shares of a particular stock at a
specified price and further agrees to cancel the option at a specified price
that decreases straight line over the term of the option. Thus, the value of the
special expiration price option is comprised of the market value of the
applicable underlying security relative to the option exercise price and the
value of the remaining premium. However, if the value of the underlying security
increases (or decreases) by a pre-negotiated amount, the special expiration
price option is canceled and becomes worthless. A portion of the dividends
during the term of the option are applied to reduce the exercise price if the
option is exercised. Brokerage commissions and other transaction costs will
reduce a Fund's profits if a special expiration price option is exercised. A
Fund will not purchase special expiration price options with respect to more
than 25% of the value of its net assets.

FUTURES CONTRACTS

INDEX FUTURES CONTRACTS AND OPTIONS. Each Fund may buy and sell index
futures contracts and related options for hedging purposes. In addition,
Opportunity Fund and Twenty-Five Fund may purchase and sell such securities to
attempt to increase investment return. A stock index futures contract is a
contract to buy or sell units of a stock index at a specified future date at a
price agreed upon when the contract is made. A unit is the current value of the
stock index.

The following example illustrates generally the manner in which index
futures contracts operate. The Standard & Poor's 100 Stock Index (the "S&P 100
Index") is composed of 100 selected common stocks, most of which are listed on
the New York Stock Exchange. The S&P 100 Index assigns relative weightings to
the common stocks included in the Index, and the Index fluctuates with changes
in the market values of those common stocks. In the case of the S&P 100 Index,
contracts are to buy or sell 100 units. Thus, if the value of the S&P 100 Index
were $180, one contract would be worth $18,000 (100 units x $180). The stock
index futures contract specifies that no delivery of the actual stocks making up
the index will take place. Instead, settlement in cash must occur upon the
termination of the contract, with the settlement being the difference between
the contract price and the actual level of the stock index at the expiration of
the contract. For example, if a Fund enters into a futures contract to buy 100
units of the S&P 100 Index at a specified future date at a contract price of
$180 and the S&P 100 Index is at $184 on that future date, the Fund will gain
$400 (100 units x gain of $4). If a Fund enters into a futures contract to sell
100 units of the stock index at a specified future date at a contract price of
$180 and the S&P 100 Index is at $182 on that future date, the Fund will lose
$200 (100 units x loss of $2).

Positions in index futures contracts may be closed out only on an exchange
or board of trade which provides a secondary market for such futures contracts.

B-4
<PAGE>
In order to hedge its investments successfully using futures contracts and
related options, a Fund must invest in futures contracts with respect to indexes
or sub-indexes the movements of which will, in the Investment Adviser's
judgment, have a significant correlation with movements in the prices of the
Fund's securities.

Options on index futures contracts give the purchaser the right, in return
for the premium paid, to assume a position in a index futures contract (a long
position if the option is a call and a short position if the option is a put) at
a specified exercise price at any time during the period of the option. Upon
exercise of the option, the holder would assume the underlying futures position
and would receive a variation margin payment of cash or securities approximating
the increase in the value of the holder's option position. If an option is
exercised on the last trading day prior to the expiration date of the option,
the settlement will be made entirely in cash based on the difference between the
exercise price of the option and the closing level of the index on which the
futures contract is based on the expiration date. Purchasers of options who fail
to exercise their options prior to the exercise date suffer a loss of the
premium paid.

As an alternative to purchasing and selling call and put options on index
futures contracts, each Fund may purchase and sell call and put options on the
underlying indexes themselves to the extent that such options are traded on
national securities exchanges. Index options are similar to options on
individual securities in that the purchaser of an index option acquires the
right to buy (in the case of a call) or sell (in the case of a put), and the
seller undertakes the obligation to sell or buy (as the case may be), units of
an index at a stated exercise price during the term of the option. Instead of
giving the right to take or make actual delivery of securities, the holder of an
index option has the right to receive a cash "exercise settlement amount." This
amount is equal to the amount by which the fixed exercise price of the option
exceeds (in the case of a put) or is less than (in the case of a call) the
closing value of the underlying index on the date of the exercise, multiplied by
a fixed "index multiplier."

A Fund may purchase or sell options on stock indices in order to close out
outstanding positions in options on stock indices which it has purchased or may
allow such options to expire unexercised.

Compared to the purchase or sale of futures contracts, the purchase of call
or put options on an index involves less potential risk to a Fund because the
maximum amount at risk is the premium paid for the options plus transactions
costs. The writing of a put or call option on an index involves risks similar to
those risks relating to the purchase or sale of index futures contracts.

MARGIN PAYMENTS. When a Fund purchases or sells a futures contract, it is
required to deposit with its custodian an amount of cash, U.S. Treasury bills,
or other permissible collateral equal to a small percentage of the amount of the
futures contract. This amount is known as "initial margin." The nature of the
initial margin is different from that of margin in security transactions in that
it does not involve borrowing money to finance transactions. Rather, initial
margin is similar to a performance bond or good faith deposit that is returned
to the Fund upon termination of the contract, assuming the Fund satisfies its
contractual obligations.

Subsequent payments to and from the broker occur on a daily basis in a
process known as "marking to market." These payments are called "variation
margin" and are made as the value of the underlying futures contract fluctuates.
For example, when a Fund sells a futures contract and the price of the
underlying index rises above the delivery price, the Fund's position declines in
value. The Fund then pays the broker a variation margin payment equal to the
difference between the delivery price of the futures contract and the value of
the index underlying the futures contract. Conversely, if

B-5
<PAGE>
the price of the underlying index falls below the delivery price of the
contract, the Fund's future position increases in value. The broker then must
make a variation margin payment equal to the difference between the delivery
price of the futures contract and the value of the index underlying the futures
contract.

When a Fund terminates a position in a futures contract, a final
determination of variation margin is made, additional cash is paid by or to the
Fund, and the Fund realizes a loss or a gain. Such closing transactions involve
additional commission costs.

Consistent with the rules and regulations of the Commodity Futures Trading
Commission exempting each Fund from regulation as a "commodity pool," each Fund
will not purchase or sell futures contracts or related options if, as a result,
the sum of the initial margin deposit on the Fund's existing futures and related
options positions and premiums paid for options on futures contracts entered
into for other than bona fide hedging purposes would exceed 5% of the Fund's
assets. (For options that are "in-the-money" at the time of purchase, the amount
by which the option is "in-the-money" is excluded from this calculation.)

SPECIAL RISKS OF TRANSACTIONS IN FUTURES CONTRACTS AND RELATED OPTIONS

LIQUIDITY RISKS. Positions in futures contracts may be closed out only on
an exchange or board of trade which provides a secondary market for such futures
contracts. Although each Fund intends to purchase or sell futures contracts only
on exchanges or boards of trade where there appears to be an active secondary
market, there is no assurance that a liquid secondary market on an exchange or
board of trade will exist for any particular futures contract or at any
particular time. If there is not a liquid secondary market at a particular time,
it may not be possible to close a futures contract position at such time and, in
the event of adverse price movements, a Fund would continue to be required to
make daily variation margin payments. However, in the event financial futures
contracts are used to hedge portfolio securities, such securities will not
generally be sold until the financial futures contracts can be terminated. In
such circumstances, an increase in the price of the portfolio securities, if
any, may partially or completely offset losses on the financial futures
contracts.

The ability to establish and close out positions in options on futures
contracts will be subject to the development and maintenance of a liquid
secondary market. It is not certain that such a market will develop. Although
each Fund generally will purchase only those options for which there appears to
be an active secondary market, there is no assurance that a liquid secondary
market on an exchange will exist for any particular option or at any particular
time. In the event no such market exists for particular options, it might not be
possible to effect closing transaction in such options, with the result that a
Fund would have to exercise the options in order to realize any profit.

HEDGING RISKS. There are several risks in connection with the use by a Fund
of futures contracts and related options as a hedging device. One risk arises
because of the imperfect correlation between movements in the prices of the
futures contracts and options and movements in the underlying securities or
index or movements in the prices of the Fund's securities which are the subject
of the hedge. The Investment Adviser will attempt to reduce the risk by
purchasing and selling, to the extent possible, futures contracts and related
options on securities and indexes the movements of which will, in its judgment,
correlate closely with movements in the prices of the underlying securities or
index and the Fund's portfolio securities sought to be hedged.

B-6
<PAGE>

Successful use of futures contracts and options by a Fund for hedging
purposes is also subject to the Investment Adviser's ability to predict
correctly movements in the direction of the market. It is possible that, where a
Fund has purchased puts on futures contracts to hedge its portfolio against a
decline in the market, the securities or index on which the puts are purchased
may increase in value and the value of securities held in the portfolio may
decline. If this occurred, the Fund would lose money on the puts and also
experience a decline in value in its portfolio securities. In addition, the
prices of futures contracts, for a number of reasons, may not correlate
perfectly with movements in the underlying securities or index due to certain
market distortions. All participants in the futures market are subject to margin
deposit requirements. Such requirements may cause investors to close futures
contracts through offsetting transactions which could distort the normal
relationship between the underlying security or index and futures contracts
markets. Further, the margin requirements in the futures contracts markets are
less onerous than margin requirements in the securities markets in general, and
as a result the futures contracts markets may attract more speculators than the
securities markets do. Increased participation by speculators in the futures
contracts markets may also cause temporary price distortions. Due to the
possibility of price distortion, even a correct forecast of general market
trends by the Investment Adviser may not result in a successful hedging
transaction over a short time period.

Opportunity Fund and Twenty-Five Fund may use futures contracts and related
options to enhance investment returns in addition to hedging against market
risk. Such use of futures contracts involves risk similar to the use of
leverage. Within applicable regulatory limits (which require that each Fund
segregate securities and other assets on its books and records with a value
equal to the value of all long futures contracts positions, less margin
deposits), Opportunity Fund and Twenty-Five Fund can be subject to the same
degree of market risk as if approximately twice their net assets were fully
invested in securities. This may result in substantial additional gains in
rising markets, but likewise may result in substantial additional losses in
falling markets.

OTHER RISKS. Each Fund will incur brokerage fees in connection with its
futures contracts and options transactions. In addition, while futures contracts
and options on futures contracts will be purchased and sold to reduce certain
risks, those transactions themselves entail certain other risks. Thus, while a
Fund may benefit from the use of futures contracts and related options,
unanticipated changes in market movements may result in a poorer overall
performance for the Fund than if it had not entered into any futures contracts
or options transactions. Moreover, in the event of an imperfect correlation
between the futures contract position and the portfolio position which is
intended to be protected, the desired protection may not be obtained and a Fund
may be exposed to risk of loss.

INDEXED SECURITIES

Each Fund may purchase securities whose prices are indexed to the prices of
other securities, securities indices or other financial indicators. Indexed
securities typically, but not always, are debt securities or deposits whose
value at maturity or coupon rate is determined by reference to a specific
instrument or statistic. The performance of indexed securities depends to a
great extent on the performance of the security or other instrument to which
they are indexed. At the same time, indexed securities are subject to the credit
risks associated with the issuer of the security, and their values may decline
substantially if the issuer's creditworthiness deteriorates. Recent issuers of
indexed securities have included banks, corporations and certain U.S. Government
agencies.

B-7
<PAGE>
REPURCHASE AGREEMENTS

Each Fund may enter into repurchase agreements. A repurchase agreement is a
contract under which a Fund acquires a security for a relatively short period
(usually not more than one week) subject to the obligation of the seller to
repurchase and the Fund to resell such security at a fixed time and price
(representing the Fund's cost plus interest). Each Fund presently intends to
enter into repurchase agreements only with member banks of the Federal Reserve
System and securities dealers meeting certain criteria as to creditworthiness
and financial condition established by the Board of Directors and only with
respect to obligations of the U.S. Government or its agencies or
instrumentalities or other high-quality, short-term debt obligations. Repurchase
agreements may also be viewed as loans made by a Fund which are collateralized
by the securities subject to repurchase. The Investment Adviser will monitor
such transactions to ensure that the value of the underlying securities will be
at least equal at all times to the total amount of the repurchase obligation,
including the interest factor. If the seller defaults, a Fund could realize a
loss on the sale of the underlying security to the extent that the proceeds of
sale are less than the resale price provided in the agreement including
interest. In addition, if the seller should be involved in bankruptcy or
insolvency proceedings, a Fund may incur delay and costs in selling the
underlying security or may suffer a loss of principal and interest if the Fund
is treated as an unsecured creditor and required to return the underlying
collateral to the seller's estate.

LEVERAGE

Opportunity Fund and Twenty-Five Fund may borrow money to purchase
additional portfolio securities. Growth Fund and Emerging Fund may not borrow
money for such purposes.

Leveraging a Fund creates an opportunity for increased net income but, at
the same time, creates special risk considerations. For example, leveraging may
exaggerate changes in the net asset value of a Fund's shares and in the yield on
the Fund's portfolio. Although the principal of such borrowings will be fixed,
the Fund's assets may change in value during the time the borrowing is
outstanding. Since any decline in value of the Fund's investments will be borne
entirely by the Fund's shareholders (and not by those persons providing the
leverage to the Fund), the effect of leverage in a declining market would be a
greater decrease in net asset value than if the Fund were not so leveraged.
Leveraging will create an interest expense for the Fund, which can exceed the
investment return from the borrowed funds. To the extent the investment return
derived from securities purchased with borrowed funds exceeds the interest the
Fund will have to pay, the Fund's investment return will be greater than if
leveraging were not used. Conversely, if the investment return from the assets
retained with borrowed funds is not sufficient to cover the cost of leveraging,
the investment return of the Fund will be less than if leveraging were not used.

REVERSE REPURCHASE AGREEMENTS

In connection with its leveraging activities, Opportunity Fund and
Twenty-Five Fund may enter into reverse repurchase agreements, in which a Fund
sells securities and agrees to repurchase them at a mutually agreed date and
time. A reverse repurchase agreement may be viewed as a borrowing by the Fund,
secured by the security which is the subject of the agreement. In addition to
the general risks involved in leveraging, reverse repurchase agreements involve
the risk that, in the event of the bankruptcy or insolvency of the Fund's
counterparty, the Fund would be unable to recover the security which is the
subject of the agreement, that the amount of cash or other property transferred
by the counterparty to the Fund under the agreement prior to such insolvency or
bankruptcy is less

B-8
<PAGE>
than the value of the security subject to the agreement, or that the Fund may be
delayed or prevented, due to such insolvency or bankruptcy, from using such cash
or property or may be required to return it to the counterparty or its trustee
or receiver.

SECURITIES LENDING

Each Fund may lend its portfolio securities, provided: (1) the loan is
secured continuously by collateral consisting of U.S. Government securities,
cash or cash equivalents adjusted daily to have market value at least equal to
the current market value of the securities loaned; (2) the Fund may at any time
call the loan and regain the securities loaned; (3) the Fund will receive any
interest or dividends paid on the loaned securities; and (4) the aggregate
market value of securities of the Fund loaned will not at any time exceed
one-third (or such other limit as the Board of Directors may establish) of the
total assets of the Fund. In addition, it is anticipated that the Fund may share
with the borrower some of the income received on the collateral for the loan or
that it will be paid a premium for the loan.

Before a Fund enters into a loan, the Investment Adviser considers all
relevant facts and circumstances, including the creditworthiness of the
borrower. The risks in lending portfolio securities, as with other extensions of
credit, consist of possible delay in recovery of the securities or possible loss
of rights in the collateral should the borrower fail financially. Although
voting rights or rights to consent with respect to the loaned securities pass to
the borrower, a Fund retains the right to call the loans at any time on
reasonable notice, and it will do so in order that the securities may be voted
by the Fund if holders of such securities are asked to vote upon or consent to
matters materially affecting the investment. The Funds will not lend portfolio
securities to borrowers affiliated with the Funds.

SHORT SALES

Opportunity Fund and Twenty-Five Fund may seek to hedge investments or
realize additional gains through short sales. Short sales are transactions in
which a Fund sells a security it does not own, in anticipation of a decline in
the market value of that security. To complete such a transaction, the Fund must
borrow the security to make delivery to the buyer. The Fund then is obligated to
replace the security borrowed by purchasing it at the market price at or prior
to the time of replacement. The price at such time may be more or less than the
price at which the security was sold by the Fund. Until the security is
replaced, the Fund is required to repay the lender any dividends or interest
that accrue during the period of the loan. To borrow the security, the Fund also
may be required to pay a premium, which would increase the cost of the security
sold. The net proceeds of the short sale will be retained by the broker (or by
the Fund's custodian in a special custody account), to the extent necessary to
meet margin requirements, until the short position is closed out. A Fund also
will incur transaction costs in effecting short sales.

A Fund will incur a loss as a result of a short sale if the price of the
security increases between the date of the short sale and the date on which the
Fund replaces the borrowed security. The Fund will realize a gain if the
security declines in price between those dates. The amount of any gain will be
decreased, and the amount of any loss increased, by the amount of the premium,
dividends, interest or expenses the Fund may be required to pay in connection
with the short sale. An increase in the value of the security sold short by the
Fund over the price at which it was sold short will result in a loss to the
Fund, and there can be no assurance that the Fund will be able to close out the
position at any particular time or at an acceptable price.

B-9
<PAGE>
ZERO-COUPON DEBT SECURITIES

Zero-coupon securities in which each Fund may invest are debt obligations
which are generally issued at a discount and payable in full at maturity, and
which do not provide for current payments of interest prior to maturity.
Zero-coupon securities usually trade at a deep discount from their face or par
value and are subject to greater market value fluctuations from changing
interest rates than debt obligations of comparable maturities which make current
distributions of interest. As a result, the net asset value of shares of a
mutual fund investing in zero-coupon securities may fluctuate over a greater
range than shares of other mutual funds investing in securities making current
distributions of interest and having similar maturities.

When debt obligations have been stripped of their unmatured interest coupons
by the holder, the stripped coupons are sold separately. The principal is sold
at a deep discount because the buyer receives only the right to receive a future
fixed payment on the security and does not receive any rights to periodic cash
interest payments. Once stripped or separated, the principal and coupons may be
sold separately. Typically, the coupons are sold separately or grouped with
other coupons with like maturity dates and sold in such bundled form. Purchasers
of stripped obligations acquire, in effect, discount obligations that are
economically identical to the zero-coupon securities issued directly by the
obligor.

Zero-coupon securities allow an issuer to avoid the need to generate cash to
meet current interest payments. Even though zero-coupon securities do not pay
current interest in cash, a Fund is nonetheless required to accrue interest
income on them and to distribute the amount of that interest at least annually
to shareholders. Thus, a Fund could be required at times to liquidate other
investments in order to satisfy its distribution requirements.

INVESTMENT RESTRICTIONS

Each Fund has adopted certain FUNDAMENTAL INVESTMENT RESTRICTIONS that may
not be changed except by a vote of shareholders owning a "majority of the
outstanding voting securities" of the Fund, as defined in the Investment Company
Act of 1940, as amended (the "Investment Company Act"). Under the Investment
Company Act, a "majority of the outstanding voting securities" means the
affirmative vote of the lesser of: (a) more than 50% of the outstanding shares
of the Fund; or (b) 67% or more of the shares present at a meeting if more than
50% of the outstanding shares are represented at the meeting in person or by
proxy. In addition, each Fund has adopted certain NON-FUNDAMENTAL INVESTMENT
RESTRICTIONS that may be changed by the Fund's Board of Directors without the
approval of the Fund's shareholders.

GROWTH FUND

FUNDAMENTAL INVESTMENT RESTRICTIONS

Growth Fund may not:

1. Invest more than 25% of its total assets in any one industry
(securities issued or guaranteed by the United States Government, its
agencies or instrumentalities are not considered to represent industries);

2. With respect to 75% of the Fund's assets, invest more than 5% of the
Fund's assets (taken at a market value at the time of purchase) in the
outstanding securities of any single issuer

B-10
<PAGE>
or own more than 10% of the outstanding voting securities of any one issuer,
in each case other than securities issued or guaranteed by the United States
Government, its agencies or instrumentalities;

3. Borrow money or issue senior securities (as defined in the
Investment Company Act) except that the Fund may borrow in amounts not
exceeding 15% of its total assets from banks for temporary or emergency
purposes, including the meeting of redemption requests which might require
the untimely disposition of securities;

4. Pledge, mortgage or hypothecate its assets other than to secure
borrowings permitted by restriction 3 above (collateral arrangements with
respect to margin requirements for options and futures contracts
transactions are not deemed to be pledges or hypothecations for this
purpose);

5. Make loans of securities to other persons in excess of 25% of its
total assets; provided the Fund may invest without limitation in short-term
obligations (including repurchase agreements) and publicly distributed
obligations;

6. Underwrite securities of other issuers, except insofar as the Fund
may be deemed an underwriter under the Securities Act of 1933 in selling
portfolio securities;

7. Purchase or sell real estate or any interest therein, including
interests in real estate limited partnerships, except securities issued by
companies (including real estate investment trusts) that invest in real
estate or interests therein;

8. Purchase securities on margin, or make short sales of securities,
except for the use of short-term credit necessary for the clearance of
purchases and sales of portfolio securities, but it may make margin deposits
in connection with transactions in options, futures contracts and options on
futures contracts;

9. Purchase or sell commodities or commodity contracts, except that,
for the purpose of hedging, it may enter into contracts for the purchase or
sale of debt and/or equity securities for future delivery, including futures
contracts and options on domestic and foreign securities indices;

10. Make investments for the purpose of exercising control or
management; or

11. Invest more than 15% of its assets in illiquid securities.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS

Growth Fund may not:

1. Invest in securities issued by other investment companies in excess
of limitations imposed by applicable law;

2. Purchase equity securities in private placements; or

3. Purchase puts, calls, straddles, spreads and any combination thereof
if by reason thereof the value of the Fund's aggregate investment in such
instruments (at the time of purchase) will exceed 5% of its total assets.

B-11
<PAGE>
EMERGING FUND

FUNDAMENTAL INVESTMENT RESTRICTIONS

Emerging Fund may not:

2. With respect to 75% of the Fund's assets, invest more than 5% of the
Fund's assets (taken at a market value at the time of purchase) in the
outstanding securities of any single issuer or own more than 10% of the
outstanding voting securities of any one issuer, in each case other than
securities issued or guaranteed by the United States Government, its
agencies or instrumentalities;

4. Make loans of securities to other persons in excess of 25% of its
total assets; provided the Fund may invest without limitation in short-term
obligations (including repurchase agreements) and publicly distributed
obligations;

5. Underwrite securities of other issuers, except insofar as the Fund
may be deemed an underwriter under the Securities Act of 1933 in selling
portfolio securities;

6. Purchase or sell real estate or any interest therein, including
interests in real estate limited partnerships, except securities issued by
companies (including real estate investment trusts) that invest in real
estate or interests therein; or

7. Purchase or sell commodities or commodity contracts, except that,
for the purpose of hedging, it may enter into contracts for the purchase or
sale of debt and/or equity securities for future delivery, including futures
contracts and options on domestic and foreign securities indices.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS

Emerging Fund may not:

1. Invest in securities issued by other investment companies in excess
of limitations imposed by federal and applicable state law;

2. Make investments for the purpose of exercising control or
management;

3. Invest more than 15% of its net assets in illiquid securities;

4. Pledge, mortgage or hypothecate its assets other than to secure
borrowings permitted by Fundamental Restriction 3 above (collateral
arrangements with respect to margin requirements for options and futures
contracts transactions are not deemed to be pledges or hypothecations for
this purpose);

B-12
<PAGE>

5. Purchase securities on margin, or make short sales of securities
(other than short sales "against the box"), except for the use of short-term
credit necessary for the clearance of purchases and sales of portfolio
securities, but it may make margin deposits in connection with transactions
in options, futures contracts and options on futures contracts; or

6. Purchase equity securities in private placements.

OPPORTUNITY FUND AND TWENTY-FIVE FUND

FUNDAMENTAL INVESTMENT RESTRICTIONS

Neither Opportunity Fund nor Twenty-Five Fund may:

2. Borrow money, except from banks for temporary or emergency purposes
or as required in connection with otherwise permissible leverage activities
(as described elsewhere in the Fund's Prospectus and in this Statement of
Additional Information) and then only in an amount not in excess of
one-third of the value of the Fund's total assets;

3. Purchase or sell commodities or commodity contracts, except as
required in connection with otherwise permissible options, futures contracts
and commodity activities (as described elsewhere in the Fund's Prospectus
and in this Statement of Additional Information);

4. Make loans of its assets to other parties, including loans of its
securities (although it may, subject to the other restrictions or policies
stated in the Fund's Prospectus and in this Statement of Additional
Information, purchase debt securities or enter into repurchase agreements
with banks or other institutions to the extent a repurchase agreement is
deemed to be a loan), in excess of one-third of its total assets;

5. Issue senior securities, as defined in the Investment Company Act,
except as required in connection with otherwise permissible options, futures
contracts and leverage activities (as described elsewhere in the Fund's
Prospectus and in this Statement of Additional Information);

7. Underwrite securities of other issuers, except insofar as it may be
deemed an underwriter under the Securities Act of 1933, as amended (the
"Securities Act") in selling certain of its portfolio securities.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS

Neither Opportunity Fund nor Twenty-Five Fund may:

1. Make short sales or purchases on margin, although it may obtain
short-term credit necessary for the clearance of purchases and sales of its
portfolio securities, and except as required in connection with otherwise
permissible options, futures contracts, short selling and leverage
activities (as described elsewhere in the Fund's Prospectus and in this
Statement of Additional Information);

B-13
<PAGE>
2. Mortgage, hypothecate, or pledge any of its assets as security for
any of its obligations, except as required to secure otherwise permissible
borrowings (including reverse repurchase agreements), short sales, financial
options and other hedging activities;

3. Invest in securities issued by other investment companies in excess
of limitations imposed by applicable law;

4. Make investments for the purpose of exercising control or
management;

5. Invest more than 15% of its net assets in illiquid securities; or

6. Purchase equity securities in private placements.

* * *

With respect to each of the foregoing fundamental and non-fundamental
investment restrictions involving a percentage of a Fund's assets, if a
percentage restriction or limitation is adhered to at the time of an investment
or sale (other than a maturity) of a security, a later increase or decrease in
such percentage resulting from a change of values or net assets will not be
considered a violation thereof.

TAXES

Each Fund intends to qualify as a "regulated investment company" under
Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). To
so qualify, each Fund must, among other things: (a) derive in each taxable year
at least 90% of its gross income from dividends, interest, payments with respect
to securities loans, gains from the sale or other disposition of stock,
securities or foreign currencies, or other income derived with respect to its
business of investing in such stock, securities or currencies; and (b) satisfy
certain diversification requirements at the close of each quarter of the Fund's
taxable year.

As a regulated investment company, each Fund will not be liable for federal
income taxes on the part of its taxable net investment income and net capital
gains, if any, that it distributes to shareholders, provided it distributes at
least 90% of its "investment company taxable income" (as that term is defined in
the Code) to Fund shareholders in each taxable year. However, if for any taxable
year a Fund does not satisfy the requirements of Subchapter M of the Code, all
of its taxable income will be subject to tax at regular corporate rates without
any deduction for distributions to shareholders, and such distributions will be
taxable to shareholders as ordinary income to the extent of the Fund's current
or accumulated earnings and profits.

Each Fund will be liable for a nondeductible 4% excise tax on amounts not
distributed on a timely basis in accordance with a calendar year distribution
requirement. To avoid the tax, during each calendar year each Fund must
distribute: (a) at least 98% of its taxable ordinary income (not taking into
account any capital gains or losses) for the calendar year; (b) at least 98% of
its capital gain net income for the twelve month period ending on October 31 (or
December 31, if the Fund so elects); and (c) any portion (not taxed to the Fund)
of the respective balances from the prior year. To the extent possible, each
Fund intends to make sufficient distributions to avoid this 4% excise tax.

Each Fund, or the shareholder's broker with respect to the Fund, is required
to withhold federal income tax at a rate of 31% of dividends, capital gains
distributions and proceeds of redemptions if a shareholder fails to furnish the
Fund with a correct taxpayer identification number ("TIN") or to certify that he
or she is exempt from such withholding, or if the Internal Revenue Service
notifies the

B-14
<PAGE>

Fund or broker that the shareholder has provided the Fund with an incorrect TIN
or failed to properly report dividend or interest income for federal income tax
purposes. Any such withheld amount will be fully creditable on the shareholder's
federal income tax return. An individual's TIN is his or her social security
number.

Each Fund may write, purchase or sell options or futures contracts.
Generally, options and futures contracts that are "Section 1256 contracts" will
be "marked to market" for federal income tax purposes at the end of each taxable
year, I.E., each option or futures contract will be treated as sold for its fair
market value on the last day of the taxable year. Gain or loss from transactions
in options and futures contracts that are subject to the "marked to market" rule
will be 60% long-term and 40% short-term capital gain or loss. However, a Fund
may be eligible to make a special election under which certain "Section 1256
contracts" would not be subject to the "marked to market" rule.

Code Section 1092, which applies to certain "straddles," may affect the
taxation of each Fund's transactions in options and futures contracts. Under
Section 1092, a Fund may be required to postpone recognition for tax purposes of
losses incurred in certain closing transactions in options and futures
contracts.

ADVISORY, ADMINISTRATIVE AND DISTRIBUTION AGREEMENTS

INVESTMENT ADVISORY AGREEMENT

The Investment Adviser has been retained as each Fund's investment adviser
pursuant to investment advisory agreements entered into by and between the
Investment Adviser and each Fund (the "Investment Advisory Agreements"). Under
the terms of the Investment Advisory Agreements, the Investment Adviser
furnishes continuing investment supervision to each Fund and is responsible for
the management of each Fund's portfolio. The responsibility for making decisions
to buy, sell or hold a particular security rests with the Investment Adviser,
subject to review by the Board of Directors.

The Investment Adviser furnishes office space, equipment and personnel to
each Fund in connection with the performance of its investment management
responsibilities. In addition, the Investment Adviser pays the salaries and fees
of all officers and directors of each Fund who are affiliated persons of the
Investment Adviser.

Each Fund pays all other expenses incurred in its operation including, but
not limited to, brokerage and commission expenses; interest charges; fees and
expenses of legal counsel and independent auditors; the Fund's organizational
and offering expenses, whether or not advanced by the Investment Adviser; taxes
and governmental fees; expenses (including clerical expenses) of issuance, sale
or repurchase of the Fund's shares; membership fees in trade associations;
expenses of registering and qualifying shares of the Fund for sale under federal
and state securities laws; expenses of printing and distributing reports,
notices and proxy materials to existing shareholders; expenses of regular and
special shareholders meetings; expenses of filing reports and other documents
with governmental agencies; charges and expenses of the Fund's administrator,
custodian and registrar, transfer agent and dividend disbursing agent; expenses
of disbursing dividends and distributions; compensation of officers, directors
and employees who are not affiliated with the Investment Adviser; travel
expenses of directors for attendance at meetings of the Board of Directors;
insurance expenses; indemnification and other expenses not expressly provided
for in the Investment Advisory Agreement; and any extraordinary expenses of a
non-recurring nature.

B-15
<PAGE>
For its services, the Investment Adviser receives from each of Growth Fund
and Emerging Fund a monthly fee at an annual rate of 1.0% of the Fund's average
daily net assets and from each of Opportunity Fund and Twenty-Five Fund a
monthly fee at an annual rate of 1.3% of the Fund's average daily net assets.
These fees exceed those paid by most other investment companies. During the
fiscal years ended December 31, 1995, 1996 and 1997, Growth Fund paid the
Investment Adviser fees of $2,448,177, $1,054,008 and $906,945, respectively;
during the fiscal years ended December 31, 1996 and 1997, Emerging Fund paid the
Investment Adviser fees of $108,940 and $163,666, respectively; and during the
fiscal years ended December 31, 1996 and 1997, Opportunity Fund paid the
Investment Adviser fees of $71 and $61,941, respectively.

The Investment Advisory Agreements continue in effect from year to year, if
specifically approved at least annually by a majority of the Board of Directors,
including a majority of the directors who are not "interested persons" (as
defined in the Investment Company Act) of The Jundt Growth Fund, Inc., Jundt
Funds, Inc. or the Investment Adviser ("Independent Directors") at a meeting in
person. Each Investment Advisory Agreement may be terminated by either party, by
the Independent Directors or by a vote of the holders of a majority of the
outstanding securities of the Fund that is a party thereto, at any time, without
penalty, upon 60 days' written notice, and automatically terminates in the event
of its "assignment" (as defined in the Investment Company Act).

PORTFOLIO TRANSACTIONS, BROKERAGE COMMISSIONS AND PORTFOLIO TURNOVER RATE

Subject to policies established by the Board of Directors, the Investment
Adviser is responsible for investment decisions and for the execution of each
Fund's portfolio transactions. A Fund has no obligation to deal with any
particular broker or dealer in the execution of transactions in portfolio
securities. In executing such transactions, the Investment Adviser seeks to
obtain the best price and execution for its transactions. While the Investment
Adviser generally seeks reasonably competitive commission rates, a Fund does not
necessarily pay the lowest commission.

During the fiscal years ended December 31, 1995, 1996 and 1997, Growth Fund
paid commissions to brokers and futures commission merchants of $371,811,
$166,936 and $121,872, respectively; during the fiscal years ended December 31,
1996 and 1997, Emerging Fund paid commissions to brokers and futures commission
merchants of $3,564 and $27,740, respectively; and during the fiscal years ended
December 31, 1996 and 1997, Opportunity Fund paid commissions to brokers and
futures commission merchants of $0 and $21,502, respectively.

ADMINISTRATION AGREEMENT

Under the terms of administration agreement by and between Princeton
Administrators, L.P. (the "Administrator") and each of The Jundt Growth Fund,
Inc. and Jundt Funds, Inc. (the "Administration Agreements"), the Administrator
performs or arranges for the performance of the following administrative
services to each Fund: (a) maintenance and keeping of certain books and records
of the Fund; (b) preparation or review and, subject to review by The Jundt
Growth Fund, Inc. or Jundt Funds, Inc., filing certain reports and other
documents required by federal, state and other applicable U.S. laws and
regulations to maintain the registrations of The Jundt Growth Fund, Inc. or
Jundt Funds, Inc. as open-end investment companies; (c) coordination of tax
related matters; (d) responses to inquiries from Fund shareholders; (e)
calculation and dissemination for publication of the net asset value of the
Fund's shares; (f) oversight and, as the Board of Directors may request,
preparation of reports and recommendations to the Board of Directors on the
performance of administrative and

B-16
<PAGE>
professional services rendered to the Fund by others, including the Fund's
custodian and any subcustodian, registrar, transfer agency, and dividend
disbursing agent, as well as accounting, auditing and other services; (g)
provision of competent personnel and administrative offices necessary to perform
its services under the Administration Agreement; (h) arrangement for the payment
of Fund expenses; (i) consultations with the officers of The Jundt Growth Fund,
Inc. or Jundt Funds, Inc. and various service providers in establishing the
accounting policies of the Fund; (j) preparation of such financial information
and reports as may be required by any banks from which the Fund borrows funds;
and (k) provision of such assistance to the Investment Adviser, the custodian
and any subcustodian, and the Fund's counsel and auditors as generally may be
required to carry on properly the business and operations of the Fund. Under the
Administration Agreement, The Jundt Growth Fund, Inc. or Jundt Funds, Inc.
agrees to cause the Fund's transfer agent to timely deliver to the Administrator
such information as may be necessary or appropriate for the Administrator's
performance of its duties and responsibilities to the Fund.

The Administrator is obligated, at its expense, to provide office space,
facilities, equipment and necessary personnel in connection with its provision
of services under the Administration Agreements; however, each Fund (in addition
to the fees payable to the Administrator under the Administration Agreement, as
described below) has agreed to pay reasonable travel expenses of persons who
perform administrative, clerical and bookkeeping functions on behalf of the
Fund. Additionally, the expenses of legal counsel and accounting experts
retained by the Administrator, after consulting with the Fund's counsel and
independent auditors, as may be necessary or appropriate in connection with the
Administrator's provision of services to the Fund, are deemed expenses of, and
shall be paid by, the Fund.

For the services rendered to each Fund and the facilities furnished, each
Fund is obliged to pay the Administrator, subject to an annual minimum fee of
$125,000, a monthly fee at an annual rate of .20% of the first $600 million of
the Fund's average daily net assets and .175% of the Fund's average daily net
assets in excess of $600 million. In the case of Emerging Fund and Opportunity
Fund, the Administrator waived in its entirety the annual minimum fee for all
periods through December 31, 1997 and has agreed to reduce such annual minimum
fee to $40,000 for the fiscal year ending December 31, 1998. In the case of
Twenty-Five Fund, the Administrator has agreed to reduce the annual minimum fee
to $40,000 for the period from the Fund's inception through December 31, 1998.
During the fiscal years ended December 31, 1995, 1996 and 1997, Growth Fund paid
the Administrator fees of $611,386, $210,802, and $181,389, respectively; during
the fiscal years ended December 31, 1996 and 1997, Emerging Fund paid the
Administrator fees of $21,788 and $32,733, respectively; and during the fiscal
years ended December 31, 1996 and 1997, Opportunity Fund paid the Administrator
fees of $11 and $9,529, respectively.

The Administration Agreements will remain in effect unless and until
terminated in accordance with their terms. They may be terminated at any time,
without the payment of any penalty, by The Jundt Growth Fund, Inc. or Jundt
Funds, Inc. on 60 days' written notice to the Administrator and by the
Administrator on 90 days' written notice to The Jundt Growth Fund, Inc. or Jundt
Funds, Inc. The Administration Agreements terminate automatically in the event
of their assignment.

The principal address of the Administrator is P.O. Box 9095, Princeton, New
Jersey 08543.

B-17
<PAGE>

DISTRIBUTOR

Pursuant to Distribution Agreements by and between U.S. Growth Investments,
Inc. (the "Distributor") and each of the Funds (the "Distribution Agreements"),
the Distributor serves as the principal underwriter of each Fund's shares. Each
Fund's shares are offered continuously by and through the Distributor. As agent
of each Fund, the Distributor accepts orders for the purchase and redemption of
Fund shares. The Distributor may enter into selling agreements with other
dealers and financial institutions, pursuant to which such dealers and/or
financial institutions also may sell Fund shares.

RULE 12b-1 DISTRIBUTION PLANS

Rule 12b-1 under the Investment Company Act provides that any payments made
by a Fund (or any Class thereof) in connection with the distribution of its
shares must be pursuant to a written plan describing all material aspects of the
proposed financing of distribution and that any agreements entered into in
furtherance of the plan must likewise be in writing. In accordance with Rule
12b-1, each Fund adopted a separate Rule 12b-1 Distribution Plan for each of its
Class A, Class B and Class C shares. There is no Rule 12b-1 Distribution Plan
for any Fund's Class I shares.

Rule 12b-1 requires that the Distribution Plans (the "Plans") and the
Distribution Agreements be approved initially, and thereafter at least annually,
by a vote of the Board of Directors, including a majority of the directors who
are not interested persons of The Jundt Growth Fund, Inc. or Jundt Funds, Inc.
and who have no direct or indirect interest in the operation of the Plans or in
any agreement relating to the Plans, cast in person at a meeting called for the
purpose of voting on the plan or agreement. Rule 12b-1 requires that each
Distribution Agreement and each Plan provide, in substance:

(a) that it shall continue in effect for a period of more than one year
from the date of its execution or adoption only so long as such continuance
is specifically approved at least annually in the manner described in the
preceding paragraph;

(b) that any person authorized to direct the disposition of moneys paid
or payable by the Fund pursuant to the Plan or any related agreement shall
provide to the Board of Directors, and the directors shall review, at least
quarterly, a written report of the amounts so expended and the purposes for
which such expenditures were made; and

(c) in the case of a Plan, that it may be terminated at any time by a
vote of a majority of the members of the Board of Directors who are not
interested persons of The Jundt Growth Fund, Inc. or Jundt Funds, Inc. and
who have no direct or indirect financial interest in the operation of the
Plan or in any agreements related to the Plan or by a vote of a majority of
the outstanding voting shares of each affected Class or Classes of the
Fund's shares.

Rule 12b-1 further requires that none of the Plans may be amended to
increase materially the amount to be spent for distribution without approval by
the shareholders of the affected Class or Classes and that all material
amendments of the Plan must be approved in the manner described in the paragraph
preceding clause (a) above.

Rule 12b-1 provides that a Fund may rely upon Rule 12b-1 only if the
selection and nomination of the disinterested directors are committed to the
discretion of such disinterested directors. Rule 12b-1 provides that a Fund may
implement or continue the Plans only if the directors who vote to approve such
implementation or continuation conclude, in the exercise of reasonable business
judgment and in

B-18
<PAGE>
light of their fiduciary duties under state law, and under Sections 36(a) and
(b) of the Investment Company Act, that there is a reasonable likelihood that
each Plan will benefit the Fund and its shareholders. The Board of Directors has
concluded that there is a reasonable likelihood that the Distribution Plans will
benefit the Funds and their shareholders.

Under its Distribution Plan, each of Class A, Class B and Class C of each
Fund pays the Distributor a Rule 12b-1 "account maintenance fee" equal on an
annual basis to .25% of the average daily net assets attributable to each such
Class. This account maintenance fee is designed to compensate the Distributor
and certain broker-dealers and financial institutions with which the Distributor
has entered into selling arrangements for the provision of certain services to
the holders of Fund shares, including, but not limited to, answering shareholder
questions, providing shareholders with reports and other information and
providing various other services relating to the maintenance of shareholder
accounts.

The Distribution Plans of Class B and Class C of each Fund provide for the
additional payment of a Rule 12b-1 "distribution fee" to the Distributor, equal
on an annual basis to .75% of the average daily net assets attributable to such
Class. This fee is designed to compensate the Distributor for advertising,
marketing, and distributing the Class B and Class C shares, including the
provision of initial and ongoing sales compensation to the Distributor's sales
representatives and to other broker-dealers and financial institutions with
which the Distributor has entered into selling arrangements.

For the fiscal years ended December 31, 1996 and 1997, the Distributor
earned the following Rule 12b-1 distribution and account maintenance fees:

<TABLE>
<CAPTION>
FISCAL YEARS ENDED
DECEMBER 31,
--------------------
1996 1997
--------- ---------
<S> <C> <C>
GROWTH FUND
Class A........................................................................ $ 293 $ 1,174
Class B........................................................................ 277 946
Class C........................................................................ 15 160
EMERGING FUND
Class A........................................................................ 3,968 4,219
Class B........................................................................ 7,169 25,751
Class C........................................................................ 13,551 17,128
OPPORTUNITY FUND
Class A........................................................................ 4 1,357
Class B........................................................................ -- 7,998
Class C........................................................................ -- 2,323
</TABLE>

SPECIAL PURCHASE PLANS

AUTOMATIC INVESTMENT PLAN. As a convenience to investors, shares may be
purchased through an automatic investment plan. Under such a plan, the investor
authorizes a Fund to withdraw a specific amount (minimum dollars $50 per
withdrawal) from the investor's bank account and to invest such amount in shares
of the Fund. Such purchases are normally made on the 5th day of each month, or
the next business day thereafter. Further information is available from the
Distributor.

B-19
<PAGE>

COMBINED PURCHASE PRIVILEGE. The following persons (or groups of persons)
may qualify for reductions from the front-end sales charge ("FESC") schedule for
Class A shares (and Growth Fund Class I shares, if eligible to purchase such
shares) set forth in the Prospectus by combining purchases of any Class of
shares of the Funds, if the combined purchase of all such shares totals at least
$25,000:

(i) an individual or a "company" as defined in Section 2(a)(8) of the
Investment Company Act;

(ii) an individual, his or her spouse and their children under
twenty-one, purchasing for his, her or their own account;

(iii) a trustee or other fiduciary purchasing for a single trust estate
or single fiduciary account (including a pension, profit-sharing or other
employee benefit trust) created pursuant to a plan qualified under Section
401 of the Code;

(iv) tax-exempt organizations enumerated in Section 501(c)(3) of the
Code;

(v) employee benefit plans of a single employer or of affiliated
employers;

(vi) any organized group which has been in existence for more than six
months, provided that it is not organized for the purpose of buying
redeemable securities of a registered investment company, and provided that
the purchase is made through a central administration, or through a single
dealer, or by other means which result in economy of sales effort or
expense. An organized group does not include a group of individuals whose
sole organizational connection is participation as credit cardholders of a
company, policyholders of an insurance company, customers of either a bank
or broker-dealer, or clients of an investment adviser.

CUMULATIVE QUANTITY DISCOUNT (RIGHT OF ACCUMULATION). A purchase of Class A
shares of a Fund (or Growth Fund Class I shares) may qualify for a Cumulative
Quantity Discount. The applicable FESC will then be based on the total of:

(i) the investor's current purchase; and

(ii) the net asset value (at the close of business on the previous day)
of shares of the Funds held by the investor; and

(iii) the net asset value of shares of any Class of shares of the Funds
owned by another shareholder eligible to participate with the investor in a
"Combined Purchase Privilege" (see above).

For example, if an investor owned shares worth $15,000 at the then current
net asset value and purchased an additional $10,000 of shares, the sales charge
for the $10,000 purchase would be at the rate applicable to a single $25,000
purchase.

To qualify for the Combined Purchase Privilege or to obtain the Cumulative
Quantity Discount on a purchase through a dealer, when each purchase is made the
investor or dealer must provide the Fund whose shares are being purchased with
sufficient information to verify that the purchase qualifies for the privilege
or discount.

LETTER OF INTENTION. Investors wishing to purchase Class A shares of a Fund
(or Growth Fund Class I Shares, if eligible to purchase such shares) may also
obtain the reduced FESC shown in the Prospectus by means of a written Letter of
Intention, which expresses the investor's intention to

B-20
<PAGE>
invest not less than $25,000 (including certain "credits," as described below)
within a period of 13 months in any Class of shares of the Funds. Each purchase
of shares under a Letter of Intention will be made at the public offering price
applicable at the time of such purchase to a single transaction of the dollar
amount indicated in the Letter of Intention. A Letter of Intention may include
purchases of shares made not more than 90 days prior to the date that an
investor signs a Letter of Intention; however, the 13-month period during which
the Letter of Intention is in effect will begin on the date of the earliest
purchase to be included. Investors qualifying for the Combined Purchase
Privilege described above may purchase shares under a single Letter of
Intention.

For example, assume that on the date an investor signs a Letter of Intention
to invest at least $25,000 as set forth above and the investor and the
investor's spouse and children under twenty-one have previously invested $10,000
in shares which are still held by such persons. It will only be necessary to
invest a total of $15,000 during the 13 months following the first date of
purchase of such shares in order to qualify for the sales charges applicable to
investments of $25,000.

The Letter of Intention is not a binding obligation upon the investor to
purchase the full amount indicated. The minimum initial investment under a
Letter of Intention is 5% of such amount. Shares purchased with the first 5% of
such amount will be held in escrow to secure payment of the higher sales charge
applicable to the shares actually purchased if the full amount indicated is not
purchased. When the full amount indicated has been purchased, the escrow will be
released. To the extent that an investor purchases more than the dollar amount
indicated on the Letter of Intention and qualifies for further reduced sales
charges, the sales charges will be adjusted for the entire amount purchased at
the end of the 13-month period. The difference in sales charges will be used to
purchase additional shares at the then current offering price applicable to the
actual amount of the aggregate purchases. Absent an instruction to the contrary,
such additional purchases shall be in shares of each Fund in proportion to the
respective number of shares held by such investor in each Fund at the time of
such additional purchases.

Investors electing to take advantage of the Letter of Intention should
carefully review the appropriate provisions on the general authorization form
attached to the Prospectus.

MONTHLY CASH WITHDRAWAL PLAN

Any investor who owns or buys shares of the Funds valued at $10,000 or more
at the current offering prices may open a Withdrawal Plan and have a designated
sum of money paid monthly to the investor or another person. Shares are
deposited in a Withdrawal Plan account and all distributions are reinvested at
net asset value in additional shares of the Fund to which such distributions
relate. Shares in a Withdrawal Plan account are then redeemed at net asset value
to make each withdrawal payment. Deferred sales charges may apply to monthly
redemptions of shares. Redemptions for the purpose of withdrawal are made on the
20th day of the month (or on the preceding business day if the 20th day falls on
a weekend or is a holiday) at that day's closing net asset value, and checks are
mailed on the next business day. Payments will be made to the registered
shareholder or to another party if preauthorized by the registered shareholder.
As withdrawal payments may include a return on principal, they cannot be
considered a guaranteed annuity or actual yield of income to the investor. The
redemption of shares in connection with a Withdrawal Plan may result in a gain
or loss for tax purposes. Continued withdrawals in excess of income will reduce
and possibly exhaust invested principal, especially in the event of a market
decline. The maintenance of a Withdrawal Plan concurrently with purchases of
additional shares of a Class which imposes an FESC would normally be

B-21
<PAGE>

disadvantageous to the investor because of the FESC payable on such purchases.
For this reason, an investor may not maintain an Automatic Investment Plan for
the accumulation of shares of a Class which imposes an FESC (other than through
reinvestment of distributions) and a Withdrawal Plan at the same time. Each Fund
or the Distributor may terminate or change the terms of the Withdrawal Plan at
any time. The Withdrawal Plan is fully voluntary and may be terminated by the
shareholder at any time without the imposition of any penalty.

Since the Withdrawal Plan may involve invasion of capital, investors should
consider carefully with their own financial advisers whether the Withdrawal Plan
and the specified amounts to be withdrawn are appropriate in their
circumstances. The Funds make no recommendations or representations in this
regard.

DETERMINATION OF NET ASSET VALUE

The net asset value per share is calculated separately for each Class of
shares of each Fund. The assets and liabilities attributable to each Class of
shares is determined in accordance with generally accepted accounting principles
and applicable SEC rules and regulations.

The portfolio securities in which each Fund invests fluctuate in value, and
hence each Fund's net asset value per share also fluctuates. On December 31,
1997, the net asset value and the maximum public offering price of each Class of
each Fund's shares was calculated as follows:

GROWTH FUND

CLASS A SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class A ($604,332)
Net Asset Value Per Share ($14.20) = ---------------------------------------------
Class A Shares outstanding (42,560)

Maximum Public Offering Price Per Net Asset Value Per Share ($14.20)
Share ($14.99) = -------------------------------
1 - Maximum FESC (5.25%)
</TABLE>

CLASS B SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class B ($189,330)
Net Asset Value Per Share ($13.99) = -----------------------------------------
Class B Shares outstanding (13,536)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS C SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class C ($79,593)
Net Asset Value Per Share ($13.97) = ------------------------------------------
Class C Shares outstanding (5,698)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS I SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class I
Net Asset Value Per Share ($14.28) = ($80,963,652)
---------------------------------------------
Class I Shares outstanding (5,668,185)
</TABLE>

<TABLE>
<S> <C>
Maximum Public Offering Price Per Net Asset Value Per Share ($14.28)
Share ($15.07) = -------------------------------
1 - Maximum FESC (5.25%)
</TABLE>

B-22
<PAGE>
EMERGING FUND

CLASS A SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class A
Net Asset Value Per Share ($13.09) = ($2,117,280)
---------------------------------------------
Class A Shares outstanding (161,777)
</TABLE>

<TABLE>
<S> <C>
Maximum Public Offering Price Per Net Asset Value Per Share ($13.09)
Share ($13.82) = -------------------------------
1 - Maximum FESC (5.25%)
</TABLE>

CLASS B SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class B
Net Asset Value Per Share ($12.90) = ($3,785,969)
---------------------------------------
Class B Shares outstanding (293,588)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS C SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class C
Net Asset Value Per Share ($12.88) = ($1,518,720)
------------------------------------------
Class C Shares outstanding (117,915)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS I SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class I
Net Asset Value Per Share ($13.25) = ($11,772,944)
----------------------------------------
Class I Shares outstanding (888,420)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

OPPORTUNITY FUND

CLASS A SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class A
Net Asset Value Per Share ($11.03) = ($1,084,103)
---------------------------------------------
Class A Shares outstanding (98,307)
</TABLE>

<TABLE>
<S> <C>
Maximum Public Offering Price Per Net Asset Value Per Share ($11.03)
Share ($11.64) = -------------------------------
1 - Maximum FESC (5.25%)
</TABLE>

CLASS B SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class B
Net Asset Value Per Share ($10.94) = ($2,297,759)
-------------------------------------------
Class B Shares outstanding (210,034)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS C SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class C ($427,490)
Net Asset Value Per Share ($10.93) = ------------------------------------------
Class C Shares outstanding (39,107)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS I SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class I
Net Asset Value Per Share ($11.06) = ($3,972,736)
----------------------------------------
Class I Shares outstanding (359,196)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

B-23
<PAGE>
TWENTY-FIVE FUND

CLASS A SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class A ($10,010)
Net Asset Value Per Share ($10.00) = ---------------------------------------------
Class A Shares outstanding (1,001)
</TABLE>

<TABLE>
<S> <C>
Maximum Public Offering Price Per Net Asset Value Per Share ($10.00)
Share ($10.55) = -------------------------------
1 - Maximum FESC (5.25%)
</TABLE>

CLASS B SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class B ($10,010)
Net Asset Value Per Share ($10.00) = ---------------------------------------
Class B Shares outstanding (1,001)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS C SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class C ($10,010)
Net Asset Value Per Share ($10.00) = ------------------------------------------
Class C Shares outstanding (1,001)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CLASS I SHARES

<TABLE>
<S> <C>
Net Assets Attributable to Class I ($970,010)
Net Asset Value Per Share ($10.00) = ----------------------------------------
Class I Shares outstanding (97,001)
</TABLE>

(MAXIMUM PUBLIC OFFERING PRICE PER SHARE IS THE SAME AS THE NET ASSET VALUE PER
SHARE)

CALCULATION OF PERFORMANCE DATA

For purposes of quoting and comparing the performance of each Class of each
Fund's shares to that of other mutual funds and to other relevant market indices
in advertisements or in reports to shareholders, performance may be stated in
terms of "average annual total return" or "cumulative total return." These total
return quotations are and will be computed separately for each Class of shares.
Under the rules of the SEC, funds advertising performance must include average
annual total return quotations calculated according to the following formula:

P(1+T)(n) = ERV

<TABLE>
<C> <C> <S>
Where: P = a hypothetical initial payment of $1,000;
T = average annual total return;
n = number of years; and
ERV = ending redeemable value at the end of the period of a hypothetical
$1,000 payment made at the beginning of such period.
</TABLE>

This calculation assumes all dividends and capital gains distributions are
reinvested at net asset value on the appropriate reinvestment dates as described
in the Prospectus, and includes all recurring fees, such as investment advisory
and management fees, charged to all shareholder accounts.

B-24
<PAGE>
Cumulative total return is computed by finding the cumulative compounded
rate of return over the period indicated in the advertisement that would equate
the initial amount invested to the ending redeemable value, according to the
following formula:

ERV - P
CTR = (____________) x 100
P

<TABLE>
<C> <C> <S>
Where: CTR = Cumulative total return;
ERV = ending redeemable value at the end of the period of a hypothetical
$1,000 payment made at the beginning of such period; and
P = initial payment of $1,000.
</TABLE>

This calculation assumes all dividends and capital gain distributions are
reinvested at net asset value on the appropriate reinvestment dates as described
in the Prospectus, and includes all recurring fees, such as investment advisory
and management fees, charged to all shareholder accounts.

Under each of the above formulas, the time periods used in advertising will
be based on rolling calendar quarters, updated to the last day of the most
recent quarter prior to submission of the advertisement for publication.

The average annual total return and cumulative total return figures
calculated in accordance with the foregoing formulas assume in the case of Class
A shares the maximum FESC has been deducted from the hypothetical initial
investment at the time of purchase, or in the case of Class B or Class C shares
the maximum applicable CDSC has been paid upon the hypothetical redemption of
the shares at the end of the period.

Past performance is not predictive of future performance. All advertisements
containing performance data of any kind will include a legend disclosing that
such performance data represents past performance and that the investment return
and principal value of an investment will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.

B-25
<PAGE>
Set forth below is selected performance information and comparative index
information for each Fund (other than Twenty-Five Fund).

<TABLE>
<CAPTION>
GROWTH FUND
- ------------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE
TOTAL RETURN
AVERAGE ANNUAL TOTAL RETURNS (FOR PERIODS ENDED
(FOR PERIODS ENDED DECEMBER 31, 1997) DECEMBER 31, 1997
--------------------------------------------------- ------------------------
SINCE SINCE SINCE SINCE
INCEPTION INCEPTION INCEPTION INCEPTION
1 YEAR 5 YEAR (9/3/91)(a) (12/29/95)(a) (9/3/91) (12/29/95)
------ ------ ----------- ------------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
CLASS A SHARES
Without sales charge............................ 10.67% N/A N/A 13.57% N/A 29.11%
With sales charge deducted(b)................... 4.86 N/A N/A 10.56 N/A 22.34
CLASS B
Without sales charge............................ 9.77 N/A N/A 12.78 N/A 27.31
With sales charge deducted(c)................... 5.77 N/A N/A 11.45 N/A 24.32
CLASS C
Without sales charge............................ 9.82 N/A N/A 12.72 N/A 27.18
With sales charge deducted(d)................... 8.82 N/A N/A 12.72 N/A 27.18
CLASS I
Without sales charge............................ 10.85 9.53% 9.32% N/A 75.76% N/A
With sales charge deducted(b)................... 5.03 8.35 8.39 N/A 66.55 N/A
RUSSELL 1000 INDEX(e)............................. 32.85 19.90 18.50 27.54 192.92 62.99
LIPPER GROWTH FUND INDEX(f)....................... 28.08 17.08 15.98 22.66 155.65 50.70
</TABLE>

- ------------------------------
(a) Total returns prior to December 29, 1995 reflects Growth Fund's performance
as a closed-end fund. Since December 29, 1995, the Fund has offered its
shares in the current four class structure.

(b) Maximum initial front-end sales charge of 5.25%.

(d) A contingent deferred sales charge of 1% will be imposed if shares are
redeemed within 1 year of purchase.

(e) Composite performance of the 1,000 largest U.S. companies based on total
market capitalization.

(f) Composite performance of the 30 largest "growth" mutual funds, as
categorized by Lipper Analytical Services, Inc.

RUSSELL AND LIPPER DATA DO NOT REFLECT THE DEDUCTION OF SALES CHARGES.

B-26
<PAGE>

<TABLE>
<CAPTION>
EMERGING FUND
- ------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
(FOR PERIODS ENDED DECEMBER
31, 1997)
---------------------------- CUMULATIVE
SINCE INCEPTION TOTAL RETURN SINCE
ONE YEAR (1/2/96) INCEPTION (1/2/96)
----------- --------------- -------------------
<S> <C> <C> <C>
CLASS A
Without sales charge............................. 33.54% 38.45% 91.51%
With sales charge deducted(a).................... 26.53 34.76 81.44
CLASS B
Without sales charge............................. 32.55 37.69 89.42
With sales charge deducted(b).................... 28.55 36.23 85.41
CLASS C
Without sales charge............................. 32.50 37.62 89.23
With sales charge deducted(c).................... 31.50 37.62 89.23
CLASS I
Without sales charge.............................
With sales charge deducted(a)....................
RUSSELL 2000 GROWTH INDEX(d)....................... 12.95 12.06 25.53
LIPPER SMALL CAP GROWTH FUND INDEX(e).............. 15.05 14.71 31.53
</TABLE>

- ------------------------------
(a) Maximum initial front-end sales charge of 5.25%.

(b) A contingent deferred sales charge of up to 4% will be imposed if shares are
redeemed within 6 years of purchase.

(d) Composite performance of companies within the Russell 2000 Index (the 2000
smallest of the 3000 largest U.S. companies based on total market
capitalization) with relatively higher price-to-book ratios and forecasted
growth values.

(e) Composite performance of the 30 largest "small company growth" mutual funds,
as categorized by Lipper Analytical Services, Inc. Inception date for index
data is December 31, 1995.

RUSSELL AND LIPPER DATA DO NOT REFLECT THE DEDUCTION OF SALES CHARGES.

B-27
<PAGE>

<TABLE>
<CAPTION>
OPPORTUNITY FUND
- -----------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
(FOR PERIODS ENDED DECEMBER
31, 1997) CUMULATIVE
---------------------------- TOTAL RETURN SINCE
SINCE INCEPTION INCEPTION
ONE YEAR (12/26/96) (12/26/96)
----------- --------------- -------------------
<S> <C> <C> <C>
CLASS A
Without sales charge.................................. 41.15% 38.69% 39.32%
With sales charge deducted(a)......................... 33.74 31.51 32.00
CLASS B
Without sales charge.................................. 40.25 37.82 38.43
With sales charge deducted(b)......................... 36.25 33.89 34.43
CLASS C
Without sales charge.................................. 40.12 37.70 38.30
With sales charge deducted(c)......................... 39.12 37.70 38.30
CLASS I
Without sales charge..................................
With sales charge deducted(a).........................
RUSSELL 3000 INDEX(d)................................... 31.79 29.81 30.27
LIPPER CAPITAL APPRECIATION FUND INDEX(e)............... 19.86 19.70 20.00
</TABLE>

- ------------------------------
(a) Maximum initial front-end sales charge of 5.25%.

(b) A contingent deferred sales charge of up to 4% will be imposed if shares are
redeemed within 6 years of purchase.

(d) Composite performance of the 3000 largest U.S. companies based on total
market capitalization.

(e) Composite performance of the 30 largest "capital appreciation" mutual funds,
as categorized by Lipper Analytical Services, Inc. Inception date for index
data is December 31, 1996.

RUSSELL AND LIPPER DATA DO NOT REFLECT THE DEDUCTION OF SALES CHARGES.

Advertisements and communications may compare the performance of Fund shares
with that of other mutual funds, as reported by Lipper Analytical Services, Inc.
or similar independent services or financial publications, and may also contrast
a Fund's investment policies and portfolio flexibility with other mutual funds.
From time to time, advertisements and other Fund materials and communications
may cite statistics to reflect the performance over time of Fund shares,
utilizing generally accepted indices or analyses, including, but not limited to,
those published by Lipper Analytical Service, Inc., Standard & Poor's
Corporation, The Frank Russell Company, Dow Jones & Company, Inc., CDA
Investment Technologies, Inc., Morningstar, Inc. and Investment Company Data
Incorporated. Performance ratings reported periodically in national financial
publications also may be used. In addition, advertising materials may include
the Investment Adviser's analysis of, or outlook for, the economy or financial
markets, compare the Investment Adviser's analysis or outlook with the views of
others in the financial community and refer to the expertise of the Investment
Adviser's personnel and their reputation in the financial community.

B-28
<PAGE>
DIRECTORS AND OFFICERS

Directors and officers of The Jundt Growth Fund, Inc. and Jundt Funds, Inc.,
together with information as to their principal occupations during the past five
years, are set forth below. All positions held are with both The Jundt Growth
Fund, Inc. and Jundt Funds, Inc.

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING
NAME AND ADDRESS POSITIONS HELD PAST 5 YEARS AND OTHER AFFILIATIONS
- -------------------------------- ---------------------------- -------------------------------------------------
<S> <C> <C>
James R. Jundt (1)(2) Chairman of the Board, Chairman of the Board, Chief Executive Officer,
1550 Utica Avenue South President and Chief Secretary and portfolio manager of the
Suite 950 Executive Officer Investment Adviser since its inception in 1982.
Minneapolis, MN 55416 Chairman of the Board, President, Chief
Executive Officer and a portfolio manager of The
Jundt Growth Fund, Inc. since 1991 and Jundt
Funds, Inc. since 1995. Chairman of the Board of
the Distributor since 1995. Also a trustee of
Gonzaga University and the Minneapolis Institute
of Arts and a director of three private
companies.
John E. Clute Director Dean and Professor of Law, Gonzaga University
807 East Highland School of Law, since 1991; previously Senior
View Ct. Vice President -- Human Resources and General
Spokane, WA 99223-6210 Counsel, Boise Cascade Corporation (forest
products) for more than five years. Director of
The Jundt Growth Fund, Inc. since 1991 and Jundt
Funds, Inc. since 1995. Also a director of Hecla
Mining Company (mining).
Floyd Hall Director Chairman, President and Chief Executive Officer
3100 West Big Beaver Road of K-Mart Corporation (retailing) since 1995.
Troy, MI 48084 Chairman and Chief Executive Officer of The
Museum Company (retailing) and Alva Replicas
Company (manufacturer of statuary and sculpture)
from 1989 to 1995; from 1984 to 1989, Chairman
and Chief Executive Officer of The Grand Union
Company (grocery store chain). Director of The
Jundt Growth Fund, Inc. since 1991 and Jundt
Funds, Inc. since 1995. Also a director of
Jamesway Corp. (discount retailing) as well as a
private company.
</TABLE>

B-29
<PAGE>

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING
NAME AND ADDRESS POSITIONS HELD PAST 5 YEARS AND OTHER AFFILIATIONS
- -------------------------------- ---------------------------- -------------------------------------------------
<S> <C> <C>
Demetre M. Nicoloff Director Cardiac and thoracic surgeon, Cardiac Surgical
1492 Hunter Drive Associates, P.A., Minneapolis, Minnesota.
Wayzata, MN 55391 Director of The Jundt Growth Fund, Inc. since
1991 and Jundt Funds, Inc. since 1995. Also a
director of Optical Sensors for Medicine, Inc.
(patient monitoring equipment); ATS Medical,
Inc. (heart valves); Micromedics, Inc.
(instrument trays, ENT specialty products and
fibrin glue applicators); Possis Medical Inc.
(cardiovascular surgical products); Applied
Biometrics, Inc. (cardiac output measuring
devices); and Sonometrics, Inc. (ultrasound
imaging equipment).
Darrell R. Wells Director Managing Director, Security Management Company
4350 Brownsboro Road, (asset management firm) in Louisville, Kentucky.
Suite 310 Director of The Jundt Growth Fund, Inc. since
Louisville, KY 40207 1991 and Jundt Funds, Inc. since 1995. Also a
director of Churchill Downs Inc. (race track
operator) and Citizens Financial Inc. (insurance
holding company), as well as several private
companies.
Donald M. Longlet Vice President and Treasurer Portfolio manager with the Investment Adviser
1550 Utica Avenue South since May 1989. Portfolio manager with AMEV
Suite 950 Advisers, Inc., St. Paul, Minnesota, from 1983
Minneapolis, MN 55416 to 1989. Vice President, Treasurer and a
portfolio manager of The Jundt Growth Fund, Inc.
since 1991 and Jundt Funds, Inc. since 1995.
</TABLE>

B-30
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING
NAME AND ADDRESS POSITIONS HELD PAST 5 YEARS AND OTHER AFFILIATIONS
- -------------------------------- ---------------------------- -------------------------------------------------
<S> <C> <C>
James E. Nicholson Secretary Partner with the law firm of Faegre & Benson LLP,
2200 Norwest Center Minneapolis, Minnesota, which has served as
Minneapolis, MN 55402 general counsel to the Investment Adviser, The
Jundt Growth Fund, Inc., Jundt Funds, Inc. and
the Distributor since their inception. Secretary
of The Jundt Growth Fund, Inc. since 1991 and
Jundt Funds, Inc. since 1995.
</TABLE>

- ------------------------
(1) Director who is an "interested person" of each Fund, as defined in the
Investment Company Act.

(2) "Controlling person" of the Investment Adviser, as defined in the Investment
Company Act. Mr. Jundt beneficially owns 95% of the stock of the Investment
Adviser. Mr. Jundt also owns 100% of the stock of the Distributor and is,
therefore, a controlling person of the Distributor as well.

The Jundt Growth Fund, Inc. and Jundt Funds, Inc. (together, the "Fund
Complex") together have agreed to pay each director who is not an "interested
person" of either The Jundt Growth Fund, Inc. or Jundt Funds, Inc. a fee of
$13,000 per year plus $1,300 for each meeting attended and to reimburse each
such director for the expenses of attendance at such meetings. No compensation
is paid by The Jundt Growth Fund, Inc., Jundt Funds, Inc. or the Fund Complex to
officers or directors who are "interested persons" of either The Jundt Growth
Fund, Inc. or Jundt Funds, Inc.

Director fees and expenses aggregated $80,418 for the fiscal year ended
December 31, 1997 The following table sets forth for such period the aggregate
compensation (excluding expense reimbursements) paid by the Fund Complex to the
directors during the year ended December 31, 1997:

COMPENSATION TABLE

<TABLE>
<CAPTION>
AGGREGATE COMPENSATION
FROM THE FUND COMPLEX
------------------------------------------
PENSIONS OR RETIREMENT
TWELVE-MONTH BENEFITS ACCRUED AS
PERIOD ENDED PART OF FUND COMPLEX
NAME OF DIRECTOR DECEMBER 31, 1997 EXPENSES
- ----------------------------------------------------------------------- ----------------- -----------------------
<S> <C> <C>
James R. Jundt......................................................... None None
Demetre M. Nicoloff.................................................... $ 16,650 None
Darrell R. Wells....................................................... $ 17,950 None
John E. Clute.......................................................... $ 17,950 None
Floyd Hall............................................................. $ 16,650 None
</TABLE>

COUNSEL AND AUDITORS

Faegre & Benson LLP, 2200 Norwest Center, 90 South Seventh Street,
Minneapolis, Minnesota 55402, serves as the Funds' general counsel. KPMG Peat
Marwick LLP, 99 High Street, Boston, Massachusetts 02110, has been selected as
the Funds' independent auditors for the fiscal year ending December 31, 1998.

B-31
<PAGE>
GENERAL INFORMATION

Under Minnesota law, each director of a company, such as The Jundt Growth
Fund, Inc. or Jundt Funds, Inc., owes certain fiduciary duties to the company
and to its shareholders. Minnesota law provides that a director "shall discharge
the duties of the position of director in good faith, in a manner the director
reasonably believes to be in the best interest of the corporation, and with the
care an ordinary prudent person in a like position would exercise under similar
circumstances." Fiduciary duties of a director of a Minnesota corporation
include, therefore, both a duty of "loyalty" (to act in good faith and act in a
manner reasonably believed to be in the best interests of the corporation) and a
duty of "care" (to act with the care an ordinarily prudent person in a like
position would exercise under similar circumstances). Minnesota law authorizes a
corporation to eliminate or limit the liability of directors to the corporation
or its shareholders for monetary damages for breaches of fiduciary duty as a
director. However, a corporation cannot eliminate or limit the liability of a
director: (a) for any breach of the director's duty of "loyalty" to the
corporation or its shareholders; (b) for acts or omissions not in good faith or
that involve intentional misconduct or a knowing violation of law, for certain
illegal distributions or for violation of certain provisions of Minnesota
securities laws; or (c) for any transaction from which the director derived an
improper personal benefit. The Articles of Incorporation of The Jundt Growth
Fund, Inc. and Jundt Funds, Inc. limit the liability of their directors to the
fullest extent permitted by Minnesota statutes, except to the extent that such
liability cannot be limited as provided in the Investment Company Act (which
prohibits any provisions which purport to limit the liability of directors
arising from such directors' willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of their role as
directors).

Minnesota law does not eliminate the duty of "care" imposed upon a director.
It only authorizes a corporation to eliminate monetary liability for violations
of that duty. Minnesota law, further, does not permit elimination or limitation
of liability of "officers" to the corporation for breach of their duties as
officers (including the liability of directors who serve as officers for breach
of their duties as officer). Minnesota law does not permit elimination of the
availability of equitable relief, such as injunctive or rescissionary relief.
These remedies, however, may be ineffective in situations where shareholders
become aware of such a breach after a transaction has been consummated and
rescission has become impractical. Further, Minnesota state law does not affect
a director's liability under the Securities Act or the Securities Exchange Act
of 1934, as amended, both of which are federal statutes. It is also uncertain
whether and to what extent the elimination of monetary liability would extend to
violations of duties imposed on directors by the Investment Company Act and the
rules and regulations thereunder.

Neither The Jundt Growth Fund, Inc. nor Jundt Funds, Inc. is required under
Minnesota law to hold annual or periodically scheduled regular meetings of
shareholders. Regular and special shareholder meetings are held only at such
times and with such frequency as required by law. Minnesota corporation law
provides for the Board of Directors to convene shareholder meetings when it
deems appropriate. In addition, if a regular meeting of shareholders has not
been held during the immediately preceding 15 months, a shareholder or
shareholders holding three percent or more of the voting shares of a company may
demand a regular meeting of shareholders of the company by written notice of
demand given to the chief executive officer or the chief financial officer of
the company. Within 90 days after receipt of the demand, a regular meeting of
shareholders must be held at the expense of the company. Irrespective of whether
a regular meeting of shareholders has been held during the immediately preceding
15 months, in accordance with Section 16(c) under the Investment Company Act,
the

B-32
<PAGE>

Board of Directors of The Jundt Growth Fund, Inc. or Jundt Funds, Inc. is
required to promptly call a meeting of shareholders for the purpose of voting
upon the question of removal of any director when requested in writing to do so
by the record holders of not less than 10% of the outstanding shares of the
Company. Additionally, the Investment Company Act requires shareholder votes for
all amendments to fundamental investment policies and restrictions and for all
investment advisory contracts and amendments thereto.

Upon issuance and sale in accordance with the terms of the Prospectus and
Statement of Additional Information, each Fund share will be fully paid and
non-assessable. Shares have no preemptive, subscription or conversion rights and
are redeemable as set forth under "How To Redeem Fund Shares" in the Prospectus.

Except as set forth below, no person owned of record or, to the knowledge of
The Jundt Growth Fund, Inc. or Jundt Funds, Inc., as applicable, owned of record
or beneficially more than 5% of any Class of a Fund's common shares as of
, 1998:

<TABLE>
<CAPTION>
GROWTH FUND
- -----------------------------------------------------------------------------------------------------------
RECORD (R) OR
NUMBER OF BENEFICIAL (B) PERCENTAGE
NAME AND ADDRESS SHARES OWNED OWNERSHIP OF CLASS
- -------------------------------------------------------------- ------------- --------------- -----------
<S> <C> <C> <C>
</TABLE>

<TABLE>
<CAPTION>
EMERGING FUND
- -----------------------------------------------------------------------------------------------------------
RECORD (R) OR
NUMBER OF BENEFICIAL (B) PERCENTAGE
NAME AND ADDRESS SHARES OWNED OWNERSHIP OF CLASS
- -------------------------------------------------------------- ------------- --------------- -----------
<S> <C> <C> <C>
</TABLE>

B-33
<PAGE>

<TABLE>
<CAPTION>
OPPORTUNITY FUND
- -----------------------------------------------------------------------------------------------------------
RECORD (R) OR
NUMBER OF BENEFICIAL (B) PERCENTAGE
NAME AND ADDRESS SHARES OWNED OWNERSHIP OF CLASS
- -------------------------------------------------------------- ------------- --------------- -----------
<S> <C> <C> <C>
</TABLE>

<TABLE>
<CAPTION>
TWENTY-FIVE FUND
- -----------------------------------------------------------------------------------------------------------
RECORD (R) OR
NUMBER OF BENEFICIAL (B) PERCENTAGE
NAME AND ADDRESS SHARES OWNED OWNERSHIP OF CLASS
- -------------------------------------------------------------- ------------- --------------- -----------
<S> <C> <C> <C>
</TABLE>

FINANCIAL AND OTHER INFORMATION

The Prospectus and this Statement of Additional Information do not contain
all the information included in the Registration Statements of The Jundt Growth
Fund, Inc. and Jundt Funds, Inc. filed with the SEC under the Securities Act and
the Investment Company Act (the "Registration Statements") with respect to the
securities offered by the Prospectus and this Statement of Additional
Information. Certain portions of the Registration Statements have been omitted
from the Prospectus and this Statement of Additional Information pursuant to the
rules and regulations of the SEC. The Registration Statements including the
exhibits filed therewith may be examined at the office of the SEC in Washington,
D.C.

In addition, the Schedules of Investments, Notes to Schedules of
Investments, Financial Statements, Notes to Financial Statements and Independent
Auditors' Report contained in the Annual Report of The Jundt Growth Fund, Inc.
and Jundt Funds, Inc. dated December 31, 1997 (File Nos. 811-06317 and
811-09128, respectively) are incorporated herein by reference.

Statements contained in the Prospectus or in this Statement of Additional
Information as to any contract or other document referred to are not necessarily
complete, and, in each instance, reference is made to the copy of such contract
or other document filed as an exhibit to the Registration Statement of which the
Prospectus and this Statement of Additional Information form a part, each such
statement being qualified in all respects by such reference.

B-34
<PAGE>

JUNDT FUNDS, INC.

REGISTRATION STATEMENT ON FORM N-1A

PART C

OTHER INFORMATION
<PAGE>
PART C
OTHER INFORMATION

ITEM 24 -- FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial highlights for each series of the Registrant are included in
Part A of this Registration Statement (Prospectuses) and financial statements
for each series of the Registrant are incorporated by reference in Part B of
this Registration Statement (Statement of Additional Information).

(b) Exhibits:

<TABLE>
<C> <S>
1.1 Articles of Incorporation and Series A and Series B
Certificates of Designation(1)

1.2 Amended Series A and Series B Certificates of Designation(2)

1.3 Series C Certificate of Designation(3)

2 Bylaws(3)

3 Not applicable

4 Not applicable

5.1 Jundt U.S. Emerging Growth Fund Investment Advisory
Agreement(4)

5.2 Jundt Opportunity Fund Investment Advisory Agreement(2)

5.3 Jundt Twenty-Five Fund Investment Advisory Agreement(3)

6.1 Jundt U.S. Emerging Growth Fund Distribution Agreement(4,5)

6.2 Jundt Opportunity Fund Distribution Agreement(1,5)

6.3 Form of Selected Dealer Agreement(1,5)

6.4 Jundt Twenty-Five Fund Distribution Agreement(3)

7 Not applicable

8 Custodian Contract(1)

9.1 Transfer Agency and Service Agreement(1)

9.2 Amended and Restated Administration Agreement

10 Opinion and Consent of Faegre & Benson LLP(3)

11 Consent of KPMG Peat Marwick LLP

12 Not applicable

13 Not applicable

14 Not applicable

15.1 Jundt U.S. Emerging Growth Fund Class B Distribution
Plan(4,5)

15.2 Jundt U.S. Emerging Growth Fund Class C Distribution Plan(4)

15.3 Jundt U.S. Emerging Growth Fund Class A Distribution
Plan(4,5)

15.4 Jundt Opportunity Fund Class B Distribution Plan(1,5)

15.5 Jundt Opportunity Fund Class C Distribution Plan(1)

15.6 Jundt Opportunity Fund Class A Distribution Plan(1,5)

15.7 Jundt Twenty-Five Fund Class A Distribution Plan(3)

15.8 Jundt Twenty-Five Fund Class B Distribution Plan(3)

15.9 Jundt Twenty-Five Fund Class C Distribution Plan(3)

16 Schedules supporting Calculations of Performance Data(2)

17 Not applicable
</TABLE>

C-1
<PAGE>

<TABLE>
<C> <S>
18.1 Jundt U.S. Emerging Growth Fund Rule 18f-3 Plan(4,5)

18.2 Jundt Opportunity Fund Rule 18f-3 Plan(1,5)

18.3 Jundt Twenty-Five Fund Rule 18f-3 Plan(3)

19 Code of Ethics(3)

20 Powers of Attorney(4)
</TABLE>

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

(1) Incorporated by reference to the like numbered exhibits to Post-Effective
Amendment No. 2 to Registration Statement on Form N-1A (File No. 33-99080)
filed with the Commission on December 5, 1996.

(2) Incorporated by reference to the like numbered exhibits to Post-Effective
Amendment No. 5 to Registration Statement on Form N-1A (File No. 33-99080)
filed with the Commission on September 3, 1997.

(3) Incorporated by reference to the like numbered exhibits to Post-Effective
Amendment No. 6 to Registration Statement on Form N-1A (File No. 33-99080)
filed with the Commission on December 15, 1997.

(4) Incorporated by reference to the like numbered exhibits to Pre-Effective
Amendment No. 1 to Registration Statement on Form N-1A (File No. 33-99080)
filed with the Commission on December 22, 1995.

(5) Plan or agreement, as applicable, was amended effective April 22, 1997
solely to change the name of each Fund's previously designated Class A
shares to "Class I" shares and to change the name of each Fund's
previously designated Class D shares to "Class A" shares. Because no other
amendments were effected, the amended agreement or plan, as applicable,
have not been refiled as exhibits.

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

The Registrant is under common control with The Jundt Growth Fund, Inc., an
open-end management investment company, by virtue of the fact that the
Registrant and The Jundt Growth Fund, Inc. share a common investment adviser.
There are no other persons, to the Registrant's knowledge, that are directly or
indirectly controlled by or under common control with the Registrant.

ITEM 26 -- NUMBER OF HOLDERS OF SECURITIES

The following table sets forth the number of holders of shares of the
Registrant as of January 31, 1998:

<TABLE>
<CAPTION>
NUMBER OF
TITLE OF CLASS RECORD HOLDERS
- -------------------------------------------------------------- --------------
<S> <C>
Series A, Class A Common Shares, par value $.01 per share..... 146
Series A, Class B Common Shares, par value $.01 per share..... 359
Series A, Class C Common Shares, par value $.01 per share..... 81
Series A, Class I Common Shares, par value $.01 per share..... 43
Series B, Class A Common Shares, par value $.01 per share..... 54
Series B, Class B Common Shares, par value $.01 per share..... 150
Series B, Class C Common Shares, par value $.01 per share..... 21
Series B, Class I Common Shares, par value $.01 per share..... 25
Series C, Class A Common Shares, par value $.01 per share..... 3
Series C, Class B Common Shares, par value $.01 per share..... 1
Series C, Class C Common Shares, par value $.01 per share..... 1
Series C, Class I Common Shares, par value $.01 per share..... 3
</TABLE>

C-2
<PAGE>
ITEM 27 -- INDEMNIFICATION

The Articles of Incorporation (Exhibit 1) and Bylaws (Exhibit 2) of the
Registrant provide that the Registrant shall indemnify such persons, for such
expenses and liabilities, in such manner, under such circumstances, and to the
full extent permitted by Section 302A.521 of the Minnesota Statutes, as now
enacted or hereafter amended, provided that no such indemnification may be made
if it would be in violation of Section 17(h) of the Investment Company Act of
1940, as now enacted or hereafter amended. Section 302A.521 of the Minnesota
Statutes, as now enacted, provides that a corporation shall indemnify a person
made or threatened to be made a party to a proceeding against judgments,
penalties, fines, settlements and reasonable expenses, including attorneys' fees
and disbursements, incurred by the person in connection with the proceeding, if,
with respect to the acts or omissions of the person complained of in the
proceeding, the person: (a) has not been indemnified by another organization for
the same judgments, penalties, fines, settlements and reasonable expenses
incurred by the person in connection with the proceeding with respect to the
same acts or omissions; (b) acted in good faith; (c) received no improper
personal benefit; (d) complied with the Minnesota Statute dealing with directors
conflicts of interest, if applicable; (e) in the case of a criminal proceeding,
had no reasonable cause to believe the conduct was unlawful; and (f) reasonably
believed that the conduct was in the best interests of the corporation or, in
certain circumstances, reasonably believed that the conduct was not opposed to
the best interests of the corporation.

The Articles of Incorporation of the Registrant further provide that, to the
fullest extent permitted by the Minnesota Business Corporations Act, as existing
or amended (except as prohibited by the Investment Company Act of 1940, as
amended) a director of the Registrant shall not be liable to the Registrant or
its shareholders for monetary damages for breach of fiduciary duty as director.

The form of Selected Dealer Agreement (Exhibit 6.2) between the Registrant's
principal underwriter, U.S. Growth Investments, Inc. (the "Distributor"), and
any broker-dealer with which the Distributor enters into such Selected Dealer
Agreement provides that each of the parties to the Selected Dealer Agreement
agrees to indemnify and hold the other harmless, including such parties'
officers, directors and any person who is or may be deemed to be a controlling
person of such party, from and against any losses, claims, damages, liabilities
or expenses, whether joint or several, to which any such person or entity may
become subject under the Securities Act of 1933 or otherwise insofar as such
losses, claims, damages, liabilities or expenses (or actions in respect thereof)
arise out of or are based upon, (a) any untrue statement or alleged untrue
statement of material fact, or any omission or alleged omission to state a
material fact made or omitted by such indemnifying party therein; or (b) any
willful misfeasance or gross misconduct by such indemnifying party in the
performance of its duties and obligations thereunder.

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

ITEM 28 -- BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

In addition to serving as investment adviser to the Registrant, Jundt
Associates, Inc. serves as the investment adviser to The Jundt Growth Fund, Inc.
as well as the investment adviser to various private accounts.

C-3
<PAGE>
See "Management of the Fund -- Investment Adviser" and "Management of the
Fund -- Portfolio Managers" in the Registrant's Prospectus and "Advisory,
Administrative and Distribution Agreements" and "Directors and Officers" in the
Registrant's Statement of Additional Information.

ITEM 29 -- PRINCIPAL UNDERWRITERS

(a) The Distributor is the only principal underwriter of the Registrant's
shares and also serves as principal underwriter of The Jundt Growth Fund, Inc.'s
shares.

(b) The following describes certain information regarding the officers and
directors of the Distributor:

<TABLE>
<CAPTION>
POSITIONS AND OFFICES POSITIONS AND OFFICES
NAME WITH THE DISTRIBUTOR WITH THE REGISTRANT
- ----------------------- ------------------------------------------- -------------------------------------------
<S> <C> <C>
James R. Jundt Chairman of the Board Chairman of the Board, President and Chief
Executive Officer

Marcus E. Jundt Director, President, Secretary and None.
Treasurer
</TABLE>

ITEM 30 -- LOCATION OF ACCOUNTS AND RECORDS

The Registrant's custodian is Norwest Bank Minnesota, N.A., Norwest Center,
90 South Seventh Street, Minneapolis, Minnesota 55402.

The Registrant's transfer agent and dividend disbursing agent is Investors
Fiduciary Trust Company, 330 West Ninth Street, Kansas City, Missouri 64105.

Other records will be maintained by the Registrant at its principal offices,
which are located at 1550 Utica Avenue South, Suite 950, Minneapolis, Minnesota
55416 and by Princeton Administrators, L.P., the Registrant's administrator,
located at 800 Scudders Mill Road, Plainsboro, New Jersey 08536.

ITEM 31 -- MANAGEMENT SERVICES

Not applicable.

ITEM 32 -- UNDERTAKINGS

(a) Not applicable.

(b) The Registrant hereby undertakes to file a post-effective amendment with
respect to its Series C Common Shares, using financial statements which need not
be certified, within four to six months from the effective date of the
registration of said Series C Common Shares.

(c) Registrant hereby undertakes to furnish to each person to whom a
prospectus of the Registrant has been furnished the latest Annual Report of the
Registrant. Such Annual Report will be furnished by the Registrant without
charge upon request by any such person.

(d) Pursuant to Section 16(c) of the Investment Company Act of 1940, as
amended, the Registrant hereby undertakes to call a shareholders' meeting for
the purpose of voting upon the question of removal of one or more directors (and
to assist shareholders in communications with each other) if and when requested
in writing to do so by the record holders of not less than ten percent of the
Registrant's outstanding shares.

C-4
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this
Post-Effective Amendment to its Registration Statement on Form N-1A to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Minneapolis, and State of Minnesota, on the 2nd day of March, 1998.

JUNDT FUNDS, INC.

By /s/ JAMES R. JUNDT

-----------------------------------
James R. Jundt
CHAIRMAN OF THE BOARD

Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to Registration Statement on Form N-1A has been signed
below by the following persons in the capacities and on the date indicated.

<TABLE>
<CAPTION>
NAME/SIGNATURE TITLE DATE
- ------------------------------------------------------------ ------------------------------ ------------------

<C> <S> <C>
Chairman of the Board,
/s/ JAMES R. JUNDT President and Chief Executive
------------------------------------------- Officer (Principal Executive March 2, 1998
James R. Jundt Officer)

/s/ DONALD M. LONGLET Vice President and Treasurer
------------------------------------------- (Principal Financial and March 2, 1998
Donald M. Longlet Accounting Officer)

------------------------------------------- Director
John E. Clute*

------------------------------------------- Director
Floyd Hall*

------------------------------------------- Director
Demetre M. Nicoloff*

------------------------------------------- Director
Darrell R. Wells*

*By /s/ JAMES R. JUNDT
--------------------------------------
James R. Jundt, March 2, 1998
ATTORNEY-IN-FACT
(Pursuant to Powers of Attorney filed with Pre-Effective
Amendment No. 1 to this Registration Statement on Form N-1A
(File No. 33-99080).)
</TABLE>

<PAGE>
EXHIBIT INDEX

<TABLE>
<CAPTION>
NUMBER AND NAME OF EXHIBIT METHOD OF FILING
- ---------------------------------------------------------------------------- -------------------------
<S> <C> <C>
1.1 Articles of Incorporation and Series A and Series B Certificates of
Designation......................................................... *

1.2 Amended Series A and Series B Certificates of Designation............. *

1.3 Series C Certificate of Designation................................... *

2 Bylaws................................................................ *

5.1 Jundt U.S. Emerging Growth Fund Investment Advisory Agreement......... *

5.2 Jundt Opportunity Fund Investment Advisory Agreement.................. *

5.3 Jundt Twenty-Five Fund Investment Advisory Agreement.................. *

6.1 Jundt U.S. Emerging Growth Fund Distribution Agreement................ *

6.2 Jundt Opportunity Fund Distribution Agreement......................... *

6.3 Form of Selected Dealer Agreement..................................... *

6.4 Jundt Twenty-Five Fund Distribution Agreement......................... *

8 Custodian Contract.................................................... *

9.1 Transfer Agency and Service Agreement................................. *

9.2 Amended and Restated Administration Agreement......................... Filed Electronically

10 Opinion and Consent of Faegre & Benson LLP............................ *

11 Consent of KPMG Peat Marwick LLP...................................... Filed Electronically

15.1 Jundt U.S. Emerging Growth Fund Class B Distribution Plan............. *

15.2 Jundt U.S. Emerging Growth Fund Class C Distribution Plan............. *

15.3 Jundt U.S. Emerging Growth Fund Class A Distribution Plan............. *

15.4 Jundt Opportunity Fund Class B Distribution Plan...................... *

15.5 Jundt Opportunity Fund Class C Distribution Plan...................... *

15.6 Jundt Opportunity Fund Class A Distribution Plan...................... *

15.7 Jundt Twenty-Five Fund Class A Distribution Plan...................... *

15.8 Jundt Twenty-Five Fund Class B Distribution Plan...................... *

15.9 Jundt Twenty-Five Fund Class C Distribution Plan...................... *

16 Schedules Supporting Calculation of Performance Data.................. *

18.1 Jundt U.S. Emerging Growth Fund Rule 18f-3 Plan....................... *

18.2 Jundt Opportunity Fund Rule 18f-3 Plan................................ *

18.3 Jundt Twenty-Five Fund Rule 18f-3 Plan................................ *

19 Code of Ethics........................................................ *

20 Powers of Attorney.................................................... *
</TABLE>

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

* Previously filed and incorporated by reference as indicated in Part C of
this Registration Statement.

<PAGE>

AMENDED AND RESTATED ADMINISTRATION AGREEMENT

THIS AMENDED AND RESTATED AGREEMENT, executed as of December 18, 1997,
amends, restates and supersedes, in their entirety the Administration Agreement
dated December 4, 1995, the Addendum thereto dated December 4, 1995, the Second
Addendum thereto dated October 10, 1996 and the Agreement dated December 3,
1996, each by and between Princeton Administrators, L.P., a Delaware limited
partnership (hereinafter called the "Administrator"), and Jundt Funds, Inc., a
Minnesota corporation (hereinafter called the "Company"), for and on behalf of
each series of the Company for which this Agreement has been duly adopted (each,
a "Fund") -- including, as of the date hereof, Jundt U.S. Emerging Growth Fund
(represented by the Company's Series A Common Shares), Jundt Opportunity Fund
(represented by the Company's Series B Common Shares) and Jundt Twenty-Five Fund
(represented by the Company's Series C Common Shares).

WITNESSETH

WHEREAS, the Company and Jundt Associates, Inc. (the "Investment Adviser")
have entered into an Investment Advisory Agreement (the "Investment Agreement")
pursuant to which the Investment Adviser has agreed to act as investment adviser
for, and to manage the affairs, business and investment of the assets of each
Fund; and

WHEREAS, the Company desires to retain the Administrator to render certain
administrative services for the Company and each Fund in the manner and on the
terms and conditions hereafter set forth; and

WHEREAS, the Administrator desires to be retained to perform such services
on said terms and conditions.

NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter contained, the Company and the Administrator agree as follows:

1. DUTIES OF THE ADMINISTRATOR. The Company hereby retains the
Administrator to act as administrator of the Company and each Fund, subject to
the supervision and direction of the Board of Directors of the Company, as
hereinafter set forth. The Administrator shall perform or arrange for the
performance of the following administrative and clerical services: (i) maintain
and keep certain books and records of the Company and each Fund; (ii) prepare or
review and, subject to approval by the Company, file certain reports and other
documents required by U.S. Federal, state (subject to and contingent upon the
Company's transfer agent providing sales and redemption data to the
Administrator via an automated data electronic feed system compatible with the
Administrator's system and acceptable to the Administrator) and other applicable
U.S. laws and regulations to maintain the Company's and each Fund's registration
as an open-end investment company and the registration of the Company's and each
Fund's shares; (iii) coordinate tax-related matters; (iv) respond to inquiries
from Fund shareholders; (v) calculate and publish, or arrange for the
calculation and publication of, the net asset value of each Fund's
<PAGE>

shares; (vi) oversee, and, as the Board may reasonably request or deem
appropriate, make reports and recommendations to the Board on, the performance
of administrative and professional services rendered to the Company and each
Fund by others, including its custodian and any subcustodian, registrar,
transfer agent, dividend disbursing agent and dividend reinvestment plan agent,
as well as accounting, auditing and other services; (vii) provide the Company
with the services of persons competent to perform the foregoing administrative
and clerical functions; (viii) provide the Company with administrative offices
and data processing facilities; (ix) arrange for payment of the Company's and
each Fund's expenses; (x) consult with the Company's officers, independent
accountants, legal counsel, custodian and any sub-custodian, registrar, transfer
agent, and dividend disbursing agent and dividend reinvestment plan agent in
establishing the accounting policies of the Company; (xi) prepare such financial
information and reports as may be required by any banks from which the Company
borrows funds; and (xii) provide such assistance to the Investment Adviser, the
custodian and any sub-custodian, and the Company's counsel and auditors as
generally may be required to carry on properly the business and operations of
the Company and each Fund. The Company agrees to cause its transfer agent,
custodian and the Investment Adviser to deliver, on a timely basis, such
information to the Administrator as may be necessary or appropriate for the
Administrator's performance of its duties and responsibilities hereunder,
including but not limited to, daily records of transactions, daily valuation of
investments in local currency (which may be based on information provided by a
pricing service) as well as the daily conversion factor in order for the
Administrator to price each Fund in United States dollars, reports of expenses
borne by the Company and each Fund, the Company's management letter to
stockholders and such other information necessary for the Administrator to
prepare the above referenced reports and filings, and the Administrator shall be
entitled to rely on the accuracy and completeness of such information in
performing its duties hereunder.

2. EXPENSES OF THE ADMINISTRATOR. The Administrator assumes and shall
pay for maintaining the staff and personnel necessary to perform its obligations
under this Agreement, and shall at its own expense, provide office space,
facilities, equipment and necessary personnel which it is obligated to provide
under paragraph 1 hereof, except that the Company shall pay reasonable travel
expenses of persons who perform administrative, clerical and bookkeeping
functions on behalf of the Company. The Company and the Investment Adviser
assume and shall pay or cause to be paid all other expenses of the Company and
each Fund as set forth in the Investment Agreement. The expenses of legal
counsel and accounting experts retained by the Administrator, after consulting
with the Company's counsel and independent auditors, as may be necessary or
appropriate for the Administrator's performance of its duties and
responsibilities under this Agreement are deemed expenses of, and shall be paid
by, the Company.

-2-
<PAGE>

accrued liabilities of the Fund exclusive of capital stock and surplus. The
value of each Fund's net assets shall be computed at the times and in the manner
specified in the Company's Registration Statement on Form N-1A, as amended from
time to time (the "Registration Statement"). Compensation by the Company of the
Administrator shall be pro-rated for any partial month of service, according to
the proportion that such period bears to the full monthly period and shall be
payable within seven (7) days after the end of the period to which such
compensation relates.

4. LIMITATION OF LIABILITY OF THE ADMINISTRATOR; INDEMNIFICATION.

(a) The Administrator shall not be liable to any person for any error
of judgment or mistake of law or for any loss arising out of any act or omission
by the Administrator in the performance of its duties hereunder; provided,
however, that nothing herein contained shall be construed to protect the
Administrator against any liability to the Company to which the Administrator
shall otherwise be subject by reason of willful misfeasance, bad faith, or gross
negligence in the performance of its duties, or by reckless disregard of its
obligations and duties hereunder.

(b) The Administrator may, with respect to questions of law, apply
for and obtain the advice or opinion of legal counsel and, with respect to the
application of generally accepted accounting principles or Federal tax
accounting principles, apply for and obtain the advice or opinion of accounting
experts. The Administrator shall be fully protected with respect to any action
taken or omitted by it in good faith in conformity with such advice or opinion.

(c) The Company agrees to indemnify and hold harmless the
Administrator from and against all charges, claims, expenses (including legal
fees) and liabilities reasonably incurred by the Administrator in connection
with the performance of its duties hereunder, except such as may arise from the
Administrator's willful misfeasance, bad faith, gross negligence in the
performance of its duties or by reckless disregard of its obligations and duties
hereunder. The Company shall make advance payments in connection with the
expenses of defending any action with respect to which indemnification might be
sought hereunder if the Company receives a written affirmation of the
Administrator's good faith belief that the standard of conduct necessary for
indemnification has been met and a written undertaking to reimburse the Company
unless it is subsequently determined that the Administrator is entitled to such
indemnification and if the Directors of the Company determine that the facts
then known to them would not preclude indemnification. In addition, at least
one of the following conditions must be met: (A) the Administrator shall
provide a security for this undertaking, (B) the Company shall be insured
against losses arising by reason of any lawful advances, or (C) a majority of a
quorum consisting of Directors of the Company who are neither "interested
persons" of the Company (as defined in Section 2(a) (19) of the 1940 Act) nor
parties to the proceeding ("Disinterested Non-Party Directors") or an
independent legal counsel in a written opinion, shall determine, based on a
review of readily available facts (as opposed to a full trial-type inquiry),
that there is reason to believe that the Administrator ultimately will be found
entitled to indemnification.

-3-
<PAGE>

(d) As used in this Paragraph 4, the term "Administrator" shall
include any affiliates of the Administrator performing services for the Company
contemplated hereby and directors, partners, officers, agents and employees of
the Administrator and such affiliates.

5. ACTIVITIES OF THE ADMINISTRATOR. The services of the Administrator
under this Agreement are not to be deemed exclusive, and the Administrator and
any person controlled by or under common control with the Administrator shall be
free to render similar services to others.

6. DURATION AND TERMINATION OF THIS AGREEMENT. This Agreement shall
become effective as of the date first above written and shall remain in force
until terminated as provided herein. This Agreement may be terminated at any
time, without the payment of any penalty, by the Company on sixty days' written
notice to the Administrator and by the Administrator on ninety days' written
notice to the Company. This Agreement shall automatically terminate in the
event of its assignment.

7. AMENDMENTS OF THIS AGREEMENT. This Agreement may be amended by the
parties hereto only if such amendment is specifically approved by the Board of
Directors of the Company and such amendment is set forth in a written instrument
executed by each of the parties hereto.

8. GOVERNING LAW. The provisions of this Agreement shall be construed
and interpreted in accordance with the laws of the State of New York as at the
time in effect and the applicable provisions of the 1940 Act. To the extent
that the applicable law of the State of New York, or any of the provisions
herein, conflict with the applicable provisions of the 1940 Act, the latter
shall control.

9. COUNTERPARTS. This Agreement may be executed by the parties hereto in
counterparts and if executed in more than one counterpart, the separate
instruments shall constitute one agreement.

10. NOTICES. Any notice under this Agreement, shall be in writing and
shall be deemed to be received on the earlier of the date actually received or
on the fourth day after the postmark if such notice is mailed first class
postage prepaid. Notice shall be addressed:

(a) if to the Administrator, to: President, Princeton
Administrators, L.P., P.O. Box 9011, Princeton, New Jersey 08543-9011; or (b) if
to the Fund, to: Chairman, Jundt Funds, Inc., 1550 Utica Avenue South, Suite
950, Minneapolis, Minnesota 55416.

-4-
<PAGE>

IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Agreement as of the day and year first above written.

JUNDT FUNDS, INC.

By: /s/ James R. Jundt
------------------------------------
Name: James R. Jundt
Title: Chairman

PRINCETON ADMINISTRATORS, L.P.
By: Princeton Services, Inc., General Partner

By: /s/ Stephen M.M. Miller
------------------------------------
Name: Stephen M.M. Miller
Title: Senior Vice President

-5-
<PAGE>

ADDENDUM TO THE
AMENDED AND RESTATED ADMINISTRATION AGREEMENT

This Addendum to the Amended and Restated Administration Agreement dated as
of December 18, 1997 (the "Administration Agreement") by and between Princeton
Administrators, L.P., a Delaware limited partnership (hereinafter called the
"Administrator"), and Jundt Funds, Inc., a Minnesota corporation (hereinafter
called the "Company"), for and on behalf of each series of the Company for which
the Agreement and this Addendum has been duly adopted (each, a "Fund") --
including, as of the date hereof, Jundt U.S. Emerging Growth Fund (represented
by the Company's Series A Common Shares), Jundt Opportunity Fund (represented by
the Company's Series B Common Shares) and Jundt Twenty-Five Fund (represented by
the Company's Series C Common Shares) -- modifies Section 3 of the
Administration Agreement for the period December 18, 1997 through December 31,
1998 (with respect to Jundt Twenty-Five Fund) and for the period January 1, 1998
through December 31, 1998 (with respect to Jundt U.S. Emerging Growth Fund and
Jundt Opportunity Fund), or for such shorter period if the Administration
Agreement is earlier terminated in accordance with its terms (the "Period"), to
read in its entirety as follows:

3. COMPENSATION OF THE ADMINISTRATOR. For the services rendered to
the Company and each Fund by the Administrator pursuant to this Agreement,
the Company shall pay to the Administrator, on behalf of and with respect
to each Fund, on the first business day of each calendar month a fee for
the previous month at an annual rate equal to the greater of (i) $40,000
per annum for each Fund ($3,333.33 per Fund per month), or (ii) 0.20% of
each Fund's net assets up to and including U.S. $600 million and 0.175% of
each Fund's net assets in excess of U.S. $600 million. For the purpose of
determining fees payable to the Administrator, the net assets of each Fund
shall mean the value of the total assets of the Fund, minus the sum of the
accrued liabilities of the Fund exclusive of capital stock and surplus.
The value of each Fund's net assets shall be computed at the times and in
the manner specified in the Company's Registration Statement on Form N-1A,
as amended from time to time (the "Registration Statement"). Compensation
by the Company of the Administrator shall be pro-rated for any partial
month of service, according to the proportion that such period bears to the
full monthly period and shall be payable within seven (7) days after the
end of the period to which such compensation relates.

Following the termination of the Period, this Addendum shall cease to be of
force and effect.

IN WITNESS WHEREOF, the parties hereto have executed this Addendum as of
the 18th day of December, 1997.

JUNDT FUNDS, INC.

By: /s/ James R. Jundt
------------------------------------
Name: James R. Jundt
Title: Chairman

PRINCETON ADMINISTRATORS, L.P.
By: Princeton Services, Inc., General Partner

By: /s/ Stephen M.M. Miller
------------------------------------
Name: Stephen M.M. Miller
Title: Senior Vice President

<PAGE>

Independent Auditors' Consent

The Board Of Directors
The Jundt Growth Fund, Inc. and Jundt Funds, Inc.:

We consent to the use of our report incorporated herein by reference and
to the references to our Firm under the headings "FINANCIAL HIGHLIGHTS"
in Part A and "COUNSEL AND AUDITORS" in Part B of the Registration
Statement.

KPMG Peat Marwick LLP

Boston, Massachusetts
March 2, 1998