CDC MPT FUNDS, N-1A, 1998-10-28

CDC MPT FUNDS
N-1A, 1998-10-28

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<PAGE>

As filed with the U.S. Securities and Exchange Commission
on October 28, 1998

Securities Act File No. 333-
Investment Company Act File No. 811-

U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [x]

Pre-Effective Amendment No.____ [ ]

Post-Effective Amendment No.____ [ ]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940 [x]

Amendment No.____ [ ]
(Check appropriate box or boxes)

CDC MPT+ FUNDS

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

9 West 57th Street, 35th Floor
New York, New York 10019

------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: (212) 891-0667

Bluford H. Putnam
President and Chief Investment Officer
9 West 57th Street, 35th Floor
New York, New York 10019

-----------------------------------------
(Name and Address of Agent for Service)

Copy to:

Daniel Schloendorn, Esq.
Willkie Farr & Gallagher
787 Seventh Avenue
New York, New York 10019-6099

<PAGE>

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

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

<PAGE>

CDC MPT+ FUNDS

FORM N-1A

CROSS REFERENCE SHEET
---------------------
<TABLE>
<CAPTION>

Part A
Item No. Prospectus Heading
- -------- ------------------
<S> <C> <C>

1. Front and Back Cover Page..................................... Front Cover Page; Back
Cover Page

2. Risk/Return Summary:
Investments, Risks,
and Performance............................................. Overview; Risk/Return Summary --
"Investment Goals and Principal
Strategies" and "A Word About Risk"

3. Risk/Return Summary:
Fee Table................................................... Risk/Return Summary -- "Investor
Expenses"

4. Investment Objectives,
Principal Investment Strategies,
and Related Risks........................................... Overview; Risk/Return Summary; U.S.
Core Equity Fund; Aggressive Equity
Fund; Global Independence Fund; Common
Investment Strategies For: Aggressive
Equity Fund and Global Independence
Fund; More About Risk

5. Management's Discussion of
Fund Performance............................................ Not Applicable

6. Management, Organization, and
Capital Structure............................................. Overview; Management; Fund Details --
"Multi-Class Structure"

7. Shareholder Information....................................... Account Policies; Shareholder
Services; Distribution Policies and
Taxes; Fund Details

<PAGE>

8. Distribution Arrangements..................................... Fund Details

9. Financial Highlights Information.............................. Not Applicable

Part B
Item No.
- --------

10. Front Cover Page and
Table of Contents........................................... Cover Page

11. Fund History.................................................. Organization of the Funds

12. Description of the Fund and its
Investments and Risks....................................... Organization of the Funds; Investment
Objectives and Policies; See
Prospectus -- "Overview," "Risk/Return
Summary;" U.S. Core Equity Fund;
Aggressive Equity Fund; Global
Independence Fund; "Common Investment
Strategies For: Aggressive Equity Fund
and Global Independence Fund," and
"More About Risk"

13. Management of the Fund........................................ Management of the Funds

14. Control Persons and Principal
Holders of Securities....................................... Management of the Funds -- "Control
Persons and Principal Stockholders"

15. Investment Advisory and
Other Services.............................................. Management of the Funds; See Prospectus --
"Overview" and "Management"

16. Brokerage Allocation
and Other Practices......................................... Investment Objectives and Policies --
"Portfolio Transactions"

<PAGE>

17. Capital Stock and Other
Securities.................................................. Organization of the Funds; Management
of the Funds -- "Capital Stock"

18. Purchase, Redemption and Pricing
of Shares................................................... Investment Objectives and Policies --
"Portfolio Valuation"; Additional
Purchase and Redemption Information;
Exchange Privilege; See Prospectus --
"Account Policies" and "Shareholder
Services"

19. Taxation of the Fund.......................................... Additional Information Concerning Taxes

20. Underwriters.................................................. Management of the Funds; See Prospectus --
"Fund Details"

21. Calculation of Performance Data............................... Determination of Performance

22. Financial Statements.......................................... Financial Statements; Report of
Deloitte & Touche LLP.
</TABLE>

Part C
- ------

Information required to be included in Part C is set forth after the appropriate
item, so numbered, in Part C to this Registration Statement.

<PAGE>

Subject to Completion, Dated October 28, 1998

PROSPECTUS

________ __, 1998

CDC MPT+ FUNDS

U.S. CORE EQUITY FUND

AGGRESSIVE EQUITY FUND

GLOBAL INDEPENDENCE FUND

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.

The information in this Prospectus is not complete and may be changed. We may
not sell these securities until the Registration Statement filed with the
Securities and Exchange Commission is effective. This Prospectus is not an
offer to sell these securities and is not soliciting an offer to buy these
securities in any State where the offer or sale is not permitted.

<PAGE>

CONTENTS
<TABLE>
<S> <C>

OVERVIEW..........................................................................................................1

RISK/RETURN SUMMARY...............................................................................................2

U.S. CORE EQUITY FUND............................................................................................10

AGGRESSIVE EQUITY FUND...........................................................................................13

GLOBAL INDEPENDENCE FUND.........................................................................................15

COMMON INVESTMENT STRATEGIES FOR: AGGRESSIVE EQUITY FUND AND GLOBAL INDEPENDENCE FUND............................17

MORE ABOUT RISK..................................................................................................19

OTHER INVESTMENT PRACTICES.......................................................................................21

MANAGEMENT.......................................................................................................23

ACCOUNT POLICIES.................................................................................................27

SHAREHOLDER SERVICES.............................................................................................29

DISTRIBUTION POLICIES AND TAXES..................................................................................31

FUND DETAILS.....................................................................................................32

ADDITIONAL INFORMATION...........................................................................................33
</TABLE>

<PAGE>

OVERVIEW

CDC MPT+ Funds is a newly organized no-load mutual fund complex with three
separate investment portfolios (each, a "fund"): the U.S. Core Equity Fund, the
Aggressive Equity Fund and the Global Independence Fund.

INVESTOR PROFILE

These funds are designed for investors who:

- - are investing for long-term goals that may include college or
retirement, with a time horizon of several years

- - are willing to assume the risk of losing money in exchange for
attractive potential long-term returns

- - are investing for total return greater than the S&P 500 Index, or, in
the case of the Global Independence Fund, the 90-day U.S. Treasury bill
rate

They may NOT be appropriate if you:

- - are investing for a shorter time horizon, especially one of less than
several years

- - are uncomfortable with an investment that will fluctuate in value

- - are primarily looking for income or tax-free income

You should base your selection of a fund on your own goals, risk preferences and
time horizon.

MULTI-CLASS STRUCTURE

Each of the funds offers two no-load classes of shares: Institutional shares and
Investor shares. Investor shares bear a shareholding service and distribution
fee of 0.25% of the shares' net asset value. Institutional shares do not bear
this fee. Whether an investor is eligible to purchase Institutional shares or
Investor shares generally depends on the amount invested in a particular fund.

INVESTMENT ADVISER

CDC MPT+ Funds is managed by CDC Investment Management Corporation ("CDC
Investments" or the "Adviser"). CDC Investments is an established provider of
alternative investment strategies for institutional clients. CDC Investments
currently has approximately $3 billion in assets under management and provides
asset management services to large European, Asian and North American financial
institutions, family offices, fund of funds, pension funds and other investors.

INVESTMENT IN THE FUNDS INVOLVES SPECIAL RISKS, SOME NOT TYPICALLY ASSOCIATED
WITH MUTUAL FUNDS. INVESTORS SHOULD CAREFULLY REVIEW AND EVALUATE THESE RISKS
WHEN CONSIDERING AN INVESTMENT IN THE FUNDS. NONE OF THE FUNDS CONSTITUTES A
BALANCED INVESTMENT PLAN.

<PAGE>

RISK/RETURN SUMMARY

INVESTMENT GOALS AND PRINCIPAL STRATEGIES

The U.S. Core Equity Fund is a diversified portfolio that seeks a high total
return by investing primarily in common stocks of U.S. issuers. The
Aggressive Equity Fund is a non-diversified portfolio that seeks a high total
return by investing primarily in equity and equity-related securities and
certain derivative instruments, including U.S. dollar and non-U.S. dollar
denominated fixed income derivative instruments and currencies. The Global
Independence Fund is a non-diversified portfolio that seeks a high total
return by investing primarily in global equity indices, global fixed income
and currency markets. Each fund employs its own strategy and has its own
risk/reward profile. Because you can lose money by investing in these funds,
be sure to read all risk disclosures carefully before investing.

<TABLE>
<CAPTION>
FUND/RISK FACTORS INVESTMENT GOAL PRINCIPAL STRATEGIES
- ----------------- --------------- --------------------
<S> <C> <C>

U.S. CORE EQUITY FUND High total return greater than that - Invests primarily in stocks of
of the S&P 500 Index U.S. companies
- - MARKET RISK - Seeks to out-perform the S&P
500 Index
- - LEVERAGE RISK - Short S&P futures for hedging
purposes
- - EXPOSURE RISK

- - RISKS OF DERIVATIVE INSTRUMENTS

AGGRESSIVE EQUITY FUND High total return greater than that - Invests primarily in equity
of the S&P 500 Index and equity-related investments,
- - EXPOSURE RISK including equity swaps, options
on securities and securities
- - LEVERAGE RISK indices, and S&P index futures
- Also invests in government
- - RISKS OF DERIVATIVE INSTRUMENTS bonds, currencies of developed
countries, currency spot and
- - MARKET RISK forward contracts, futures,
options on futures and other
- - FOREIGN SECURITIES RISK derivatives to enhance return
incrementally and manage risk
- - INTEREST RATE RISK - Obtains exposure to the global
equity, global fixed income and
- - REGULATORY RISK currency markets
- Uses unencumbered cash to
- - NON-DIVERSIFICATION RISK invest in money market
instruments and short-term
obligations of high quality
</TABLE>

2
<PAGE>

<TABLE>
<CAPTION>
FUND/RISK FACTORS INVESTMENT GOAL PRINCIPAL STRATEGIES
- ----------------- --------------- --------------------
<S> <C> <C>

GLOBAL INDEPENDENCE FUND High total return greater than that - Invests primarily in global
of the 90-day U.S. Treasury bill rate equity indices, global fixed
- - EXPOSURE RISK income and currency markets
- - LEVERAGE RISK - Uses equity swaps, options on
securities and securities
- - RISKS OF DERIVATIVE INSTRUMENTS indices, government bonds,
currencies of developed
- - FOREIGN SECURITIES RISK countries, currency spot and
forward contracts, futures,
- - INTEREST RATE RISK options on futures and other
derivatives to incrementally
- - MARKET RISK enhance return and manage risk
- - REGULATORY RISK - Uses unencumbered cash to
invest in money market
- - NON-DIVERSIFICATION RISK instruments and short-term
obligations of high quality

</TABLE>

The Aggressive Equity Fund and the Global Independence Fund will buy and sell
commodity futures contracts and options thereon up to the fullest extent
permissible under applicable law. Applicable law currently permits unlimited
use of futures and related options for bona fide hedging purposes; however,
aggregate initial margin and premiums required to establish non-hedging
positions may not exceed 5% of each fund's net asset value after taking into
account unrealized profits and unrealized losses on any contracts it has
entered into. Although these funds are limited in the amount of assets that
may be invested in futures transactions, there is no overall limit on the
percentage of a fund's assets that may be at risk with respect to futures
activities.

Each of the Aggressive Equity Fund and the Global Independence Fund will employ
the Adviser's Global Dynamic Asset Allocation Strategy which is described under
the detailed discussion of the Aggressive Equity Fund in this prospectus.

The Standard & Poor's 500 Composite Stock Price Index (the "S&P 500 Index") is
an unmanaged index composed of 500 common stocks, most of which are listed on
the New York Stock Exchange. The S&P 500 Index assigns relative percentage
weights to the stocks included in the index, weighted according to each stock's
total market value relative to the total market value of the other stocks in
such index. The 90-day U.S. Treasury bill rate is an index composed of offered
levels for U.S. Treasury bills.

A WORD ABOUT RISK

All investments involve some level of risk. Simply defined, risk is the
possibility that you will lose money and not make money.

The principal risks of investing in the funds are discussed below. Before you
invest, please make sure you understand the risks that apply to your fund. As
with any mutual fund, there is no guarantee that you will make money over any
period of time and you could lose money by investing in a fund.

Investments in the funds are not bank deposits. They are not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.

3
<PAGE>

ALL FUNDS

MARKET RISK

The market value of a security may move up and down, sometimes rapidly and
unpredictably. Stock markets tend to move in cycles, with periods of rising
stock prices and periods of falling stock prices. These fluctuations may cause a
security to be worth less than the price originally paid for it, or less than it
was worth at an earlier time. Market risk may affect a single issuer, industry,
sector of the economy or the market as a whole. Market risk is common to most
investments -- including stocks and bonds, and the mutual funds that invest in
them.

Bonds and other fixed-income securities may involve less market risk than
stocks, but not always. The risk of bonds can vary significantly depending upon
factors such as issuer and maturity. Bonds of some companies are riskier than
the stocks of others. The risk of bonds declining in value may be offset in
whole or in part by the income they provide.

EXPOSURE RISK

The risk associated with techniques that increase a fund's exposure to a
security, index or its investment portfolio. Exposure is the fund's maximum
potential gain or loss from an investment. Certain investments (such as options
and futures) and certain practices (such as short-selling) may have the effect
of magnifying declines as well as increases in a fund's net asset value. Losses
from writing options and entering into futures and short sales can be unlimited.

LEVERAGE RISK

If a fund borrows or otherwise uses leverage to invest in securities or
derivative instruments, any investment gains made on the securities or
instruments in excess of interest or other amounts paid by the fund will cause
the net asset value of the fund's shares to rise faster than would otherwise be
the case. On the other hand, if the investment performance of the additional
securities or instruments purchased fails to cover their cost (including any
interest paid on borrowed money) to the fund, the net asset value of the fund's
shares will decrease faster than would otherwise be the case. The use of
leverage can lead to substantial losses.

RISKS OF DERIVATIVE INSTRUMENTS

The use of these instruments requires special skills, knowledge and investment
techniques that differ from those required for normal portfolio management. The
success of the funds in selecting these instruments for their portfolios depends
on the skill of the Adviser in predicting the movement of interest rates, the
value of particular instruments and other economic variables. There is no
assurance that the Adviser will accurately predict these movements.

AGGRESSIVE EQUITY FUND AND GLOBAL INDEPENDENCE FUND ONLY

REGULATORY RISK

Positions in futures and options on futures will be entered into only to the
extent they constitute permissible positions for a fund according to applicable
rules of the Commodity Futures Trading Commission. At times, the Adviser may be
constrained in its ability to use futures, options on futures or other
derivatives by an unanticipated inability to close positions when it would be
most advantageous to do so or at favorable prices. These regulatory constraints
may have an adverse effect on fund management or performance.

4
<PAGE>

INTEREST RATE RISK

Changes in interest rates may cause a decline in an investment's market value.
With bonds and other fixed income securities, a rise in interest rates typically
causes a fall in values, while a fall in interest rates typically causes a rise
in values.

FOREIGN SECURITIES RISK

CURRENCY RISK

Fluctuations in the exchange rates between the U.S. dollar and foreign
currencies may negatively affect an investment. Adverse changes in
exchange rates may erode or reverse any gains produced by foreign
currency-denominated investments and may widen any losses. If futures
are traded on non-U.S. exchanges, such exchanges may require that
margin for open positions be converted to the home currency of the
contract. Whenever margin is held in a non-U.S. currency, losses may
occur if exchange rates fluctuate. Also, direct currency positions,
through currency forward contracts, may go up or down in price.

POLITICAL RISK

Government or political actions of any sort may cause losses in a fund.
These actions may range from changes in tax or trade statutes to
nationalization, expropriation, currency blockage or governmental
collapse and war, among many others.

INFORMATION RISK

Key information about an issuer, security or market may be inaccurate
or unavailable.

NON-DIVERSIFICATION RISK

As non-diversified portfolios, these funds are not limited in the amount of
their assets that may be invested in the securities of a single issuer. Each
fund may invest a greater proportion of its assets in the securities of a
smaller number of issuers. Each fund's relatively low level of diversification
means that there is a greater chance that the poor performance of a single
position could hurt the total value of the fund.

5
<PAGE>

INVESTOR EXPENSES

The following tables describe the fees and expenses you may pay if you buy and
hold shares of a fund. Please note that the expenses of each fund include the
basic and maximum and minimum management fees payable to the Adviser.

FEES AND EXPENSES OF THE INSTITUTIONAL SHARES

- -----------------------------------------------------------------------------------------------------------------
GLOBAL
U.S. CORE EQUITY FUND AGGRESSIVE EQUITY FUND INDEPENDENCE FUND
- -----------------------------------------------------------------------------------------------------------------
BASIC MAXIMUM MINIMUM BASIC MAXIMUM MINIMUM BASIC MAXIMUM MINIMUM
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>

SHAREHOLDER FEES
(paid directly from your
investment)
- -----------------------------------------------------------------------------------------------------------------
Sales charge "load" on
purchases None None None None None None None None None
- -----------------------------------------------------------------------------------------------------------------
Deferred sales charge
"load" None None None None None None None None None
- -----------------------------------------------------------------------------------------------------------------
Sales charge "load" on
reinvested distributions None None None None None None None None None
- -----------------------------------------------------------------------------------------------------------------
Redemption fees (short-term
trading fees)* 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
- -----------------------------------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES
(deducted from fund assets)
- -----------------------------------------------------------------------------------------------------------------
Management fees** 1.00% 2.00% 0% 1.50% 3.00% 0% 1.50% 3.00% 0%
- -----------------------------------------------------------------------------------------------------------------
Distribution and
service (12b-1) fees 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
- -----------------------------------------------------------------------------------------------------------------
Other expenses*** ___% ___% ___% ___% ___% ___% ___% ___% ___%
- -----------------------------------------------------------------------------------------------------------------
TOTAL ANNUAL FUND OPERATING
EXPENSES ___% ___% ___% ___% ___% ___% ___% ___% ___%
- -----------------------------------------------------------------------------------------------------------------
</TABLE>

SEE NOTES ON THE FOLLOWING PAGES.

6
<PAGE>

FEES AND EXPENSES OF THE INSTITUTIONAL SHARES

SHAREHOLDER FEES
(paid directly from your
investment)
- -----------------------------------------------------------------------------------------------------------------
Sales charge "load" on
purchases None None None None None None None None None
- -----------------------------------------------------------------------------------------------------------------
Deferred sales charge
"load" None None None None None None None None None
- -----------------------------------------------------------------------------------------------------------------
Sales charge "load" on
reinvested distributions None None None None None None None None None
- -----------------------------------------------------------------------------------------------------------------
Redemption fees (short-term
trading fees)* 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
- -----------------------------------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES
(deducted from fund assets)
- -----------------------------------------------------------------------------------------------------------------
Management fees** 1.00% 2.00% 0% 1.50% 3.00% 0% 1.50% 3.00% 0%
- -----------------------------------------------------------------------------------------------------------------
Distribution and
service (12b-1) fees None None None None None None None None None
- -----------------------------------------------------------------------------------------------------------------
Other expenses*** ___% ___% ___% ___% ___% ___% ___% ___% ___%
- -----------------------------------------------------------------------------------------------------------------
TOTAL ANNUAL FUND OPERATING
EXPENSES ___% ___% ___% ___% ___% ___% ___% ___% ___%
- -----------------------------------------------------------------------------------------------------------------
</TABLE>

* Each fund will deduct a short-term trading fee equal to 1.00% of the net
asset value of the shares from the redemption amount if you sell your
shares after holding them less than 90 days. This fee is paid to the fund
rather than the Adviser, and is designed to offset the brokerage
commissions, market impact and other costs associated with fluctuations
in fund asset levels and cash flow caused by short-term shareholder
trading. The short-term trading fee, if applicable, is charged on
exchanges out of a fund. If you bought shares on different days, the
shares you held longest will be redeemed first for purposes of
determining whether the short-term trading fee applies. The short-term
trading fee does not apply to shares that were acquired through
reinvestment of distributions.

7
<PAGE>

** The management fee paid to the Adviser for providing advisory services to
the funds consists of a basic fee and a performance adjustment. The basic
fee for the U.S. Core Equity Fund, the Aggressive Equity Fund and the
Global Independence Fund is 1.00%, 1.50% and 1.50% of the fund's average
net assets, respectively. The actual fees paid to the Adviser may be
higher or lower than the basic fee. See "Management--Management Fees" for
additional information about the fee calculation.

*** Other expenses are based on estimated amounts for each fund's first full
fiscal year since the funds have not yet commenced operations.

8
<PAGE>

EXAMPLE

This example is intended to help you compare the cost of investing in the funds
with the cost of investing in other mutual funds. However, it is only
hypothetical and your actual costs may be higher or lower.

The example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses (other than the management fee) remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your cost would be:

INVESTOR SHARES
<TABLE>
<CAPTION>

U.S. CORE EQUITY FUND $ $ $ $ $ $
- -------------------------------------------------------------------------------------------------------------------
AGGRESSIVE EQUITY FUND $ $ $ $ $ $
- -------------------------------------------------------------------------------------------------------------------
GLOBAL INDEPENDENCE FUND $ $ $ $ $ $
- -------------------------------------------------------------------------------------------------------------------
</TABLE>

INSTITUTIONAL SHARES

- -------------------------------------------------------------------------------------------------------------------
1 YEAR 3 YEARS
- -------------------------------------------------------------------------------------------------------------------
BASIC MAXIMUM MINIMUM BASIC MAXIMUM MINIMUM
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
U.S. CORE EQUITY FUND $ $ $ $ $ $
- -------------------------------------------------------------------------------------------------------------------
AGGRESSIVE EQUITY FUND $ $ $ $ $ $
- -------------------------------------------------------------------------------------------------------------------
GLOBAL INDEPENDENCE FUND $ $ $ $ $ $
- -------------------------------------------------------------------------------------------------------------------
</TABLE>

9
<PAGE>

U.S. CORE EQUITY FUND

GOAL AND STRATEGIES

The U.S. Core Equity Fund seeks a high total return greater than that of the S&P
500 Index. The Fund is designed to provide investors with access to a
professionally and actively managed portfolio that aims to provide superior
investment returns relative to those that could be achieved from the general
U.S. equity market. Specifically, the Fund seeks to out-perform the investment
returns of the S&P 500 Index on average and over a period of years.

The Fund will use a fundamental and quantitative approach to equity portfolio
management that emphasizes well-tested academic theories of corporate finance
and modern portfolio theory tempered by a healthy practical respect for the
realities of the financial markets and the general economic environment. The
investment strategy will focus on companies where management creates shareholder
value by:

- - growing operating profits

- - designing appropriate capital structures for the business risks being
taken

- - adopting disciplined new project investment policies as well as
acquisition and divestiture policies that earn expected returns in excess
of the risk-adjusted cost of capital

- - designing senior management compensation plans that reward the creation of
shareholder value.

The Fund will utilize a number of time-tested quantitative systems for
identifying overvalued and undervalued common stocks. These quantitative tools
will focus on a number of analytical topics, including:

- - earnings growth, earnings surprises and earnings estimate revisions

- - price momentum of stocks

- - valuation analysis

- - merger and acquisition arbitrage analysis

- - seasonal market factors

- - analyzing secondary public offerings and stock buy-backs

The Adviser will manage the Fund with a very disciplined approach to taking
risks relative to the overall U.S. equity market as represented by the S&P 500
Index. The Adviser will use a number of quantitative tools to measure the
sources of risk in the portfolio, in terms of market timing risks, industry
risks, risks from various types of economic and financial factors and stock
specific risks. The objective of this portfolio from a risk management
perspective is to have the stock specific risks dominate the opportunities to
earn returns superior to the S&P 500 Index, and to do so in controlled and
disciplined manner. In particular, market timing risks and industry risks in the
core equity portfolio will be held to a minimum, but some market directional
risks may be accepted to provide for protection against market downturns through
futures, options on futures or short sales when deemed appropriate by the
Adviser to conserve the capital of the Fund.

The Fund does not focus on one source of shareholder value, such as earnings
growth or market undervaluation, but seeks a more robust understanding of the
various sources from which shareholder value can be created. The theoretical
foundations and guiding principles of modern portfolio theory, corporate
finance theory and economic value-added analysis (EVA-Registered Trademark-
is a registered trademark of Stern Stewart & Co.) and our disciplined use of

10
<PAGE>

quantitative and risk management tools are intended to produce a well
diversified and balanced portfolio that can earn returns superior to the S&P 500
Index without taking unnecessary risks. As such, this Fund is neither a value or
a growth fund, in the common usage of those terms, but is a risk-managed
portfolio seeking equity returns from a diversified set of sources.

Securities and industry concentration will be limited by the desire to maintain
a reasonable risk level relative to the S&P 500 Index and the basic stock and
industry composition of that index.

S&P Index futures may be used to manage cash flows, equitize unencumbered cash,
control risks or incrementally enhance returns.

PORTFOLIO INVESTMENTS

Normally this Fund invests substantially all of its assets in equity securities,
including:

- - common stocks of U.S. issuers

- - securities convertible into common stocks

- - securities such as rights and warrants, whose values are based on
common stocks

- - dollar-denominated American Depositary Receipts ("ADRs")

The Fund may also invest in preferred stocks and non-convertible debt securities
such as bonds, debentures and notes. Cash positions will be invested in
investment grade fixed-income securities with a net portfolio duration of the
overall cash portfolio of less than 3 years.

The Fund may gain exposure to stocks through:

- - common and convertible shares

- - short sales

- - purchases on margin

- - writing put and call options

- - initial public offerings

Exposures to the U.S. stock market may also be acquired by:

- - stock market and industry specific index commodity futures contracts

- - options contracts

- - options on futures contracts

- - exchange-traded options on individuals stocks

The Fund may also engage in:

- - arbitrage activities

11
<PAGE>

- - repurchase agreements

- - reverse repurchase agreements

- - short sales of S&P futures contracts

- - forward delivery contracts

For liquidity and flexibility, the Fund may invest a portion of its assets in
money market instruments and short-term obligations of high quality, including
U.S. Government securities, bank obligations, repurchase and reverse repurchase
agreements, commercial paper and other investment-grade debt securities. As a
defensive tactic in unusual market conditions, the Fund may temporarily invest
without limit in these money market and short-term obligations. This could
potentially keep the Fund from achieving its objective.

RISK FACTORS

This Fund's principal risk factors are:

- - market risk

- - leverage risk

- - exposure risk

- - risks of derivative instruments

The value of your investment will fluctuate in response to stock market
movements. To a limited extent, the Fund may also engage in other investment
practices, including the purchase of foreign securities. International investing
is associated with additional risks, including currency, information and
political risks. The Fund may use structured securities and other instruments
(such as swaps) to gain access to the performance of a benchmark asset such as
an index or selected stocks where the Fund's direct investment in the benchmark
asset is restricted. These types of investments carry a number of additional
risks such as access, credit, currency, exposure, information, interest rate,
liquidity, market, political and valuation risks. In addition, the Fund may be
subject to interest rate risk to the extent it invests in fixed-income
securities and engages in futures and options on futures transactions. These
risks are defined under the "Risk/Return Summary" or "More About Risk."

To the extent that it invests in certain securities or other instruments, the
Fund may be affected by additional risks. These risks are defined in "More About
Risk." That section also details other investment practices the Fund may use.
Please read "More About Risk" carefully before you invest.

12
<PAGE>

AGGRESSIVE EQUITY FUND

GOAL AND STRATEGIES

The Aggressive Equity Fund seeks a high total return greater than that of the
S&P 500 Index. The Fund will seek a high total return by investing primarily
in the U.S. equity market, as well as the global equity, global fixed income
and currency markets. The Fund may use certain derivative instruments for
incremental enhancement of its investment objective and risk management. The
Fund's investments outside the United States will generally be limited to
developed countries. The Fund will apply the Adviser's Global Dynamic Asset
Allocation Strategy ("GDAA") which focuses on building a risk-return balanced
portfolio which seeks to control the effect of shifts in market volatility in
the equity and fixed-income markets of economies with liquid equity and bond
markets, and use short-term currency forward contracts for exchange rate
exposure to the currencies of these countries and other currency markets
providing good liquidity. The GDAA methodology seeks to exploit consistent,
albeit evolving, patterns in the relationships of fundamental economic and
financial variables to the underlying equity, bond and currency markets. It
uses a mix of fundamental judgment and sophisticated quantitative tools. The
quantitative tools include systems which simultaneously estimate predictive
expected asset returns with asset risks and correlations, to achieve a stream
of portfolio returns which effectively balance risk against return and
provide for a portfolio with expected risks within a reasonable range.

PORTFOLIO INVESTMENTS

The Fund may invest its assets directly in equity securities and derivative
instruments of U.S. issuers including:

- - common stocks

- - securities convertible into common stocks

- - rights and warrants, whose values are based on common stocks

- - depositary receipts relating to equity securities, including Standard &
Poor's Depositary Receipts ("S.P.D.R.s")

- - equity swap contracts

- - options on securities and securities indices

- - S&P 500 index futures contracts and options thereon

To enhance its investment returns incrementally and to manage risk, the Fund may
also enter into:

- - futures on global equity indices

- - government bond and other financial futures

- - currency spot and forward contracts

- - currency and interest rate futures contracts

- - option contracts and options on futures contracts

To a lesser extent, the Fund may also purchase or sell contracts relating to the
future delivery of precious metals.

13
<PAGE>

The Fund may also invest directly in long-term U.S. and foreign government
securities. For liquidity and flexibility, the Fund intends to place its
remaining assets in money market instruments and short-term obligations of high
quality, including U.S. Government securities, bank obligations, repurchase and
reverse repurchase agreements, commercial paper and other investment-grade debt
securities. As a defensive tactic in unusual market conditions, the Fund may
temporarily invest without limit in these money market and short-term
obligations. This could potentially keep the Fund from achieving its goal.

The Fund may also invest in preferred stocks and non-convertible debt securities
such as bonds, debentures and notes.

RISK FACTORS

This Fund's principal risk factors are:

- - exposure risk

- - leverage risk

- - risks of derivative instruments

- - foreign securities risk

- - market risk

- - interest rate risk

- - regulatory risk

- - non-diversification risk

The value of your investment will fluctuate in response to global stock market
movements, as well as global bond market movements. In addition, because the
Fund invests globally, it will be exposed to currency, information, political
and, possibly, natural event and risks associated with the conversion of the
various European currencies into a single "euro" currency. To the extent that
the Fund's foreign investments at any given time are focused in one particular
country or target a single region, the Fund may be more volatile than a more
geographically diversified fund.

The Fund's transactions in leveraged derivative securities, such as options on
securities and indices, futures contracts and related options, and transactions
in currency contracts, carry additional risks, such as correlation, liquidity,
credit, opportunity and regulatory risks. The Fund may also use structured
securities and other instruments (such as swaps) to gain access to the
performance of a benchmark asset such as an index or selected stocks where the
Fund's direct investment in the benchmark asset is restricted. These types of
investments carry a number of additional risks such as access, credit, currency,
exposure, information, interest rate, liquidity, market, political and valuation
risks. These risks and additional risks that the Fund may be subject to are
defined in the "Risk/Return Summary" or "More About Risk." "More About Risk"
also details other investment practices the Fund may use, which, if employed,
are associated with further risk that could adversely affect the Fund's
performance. Please read "More About Risk" carefully before you invest.

14
<PAGE>

GLOBAL INDEPENDENCE FUND

GOAL AND STRATEGIES

The Global Independence Fund seeks a high total return greater than that of the
90-day U.S. Treasury bill rate. To achieve its investment objective, the Fund
invests in the global equity, global fixed income and currency markets. The Fund
seeks to enhance its investment objective incrementally and manage risk by using
currency spot and forward contracts, financial futures, options on futures and
other derivative instruments. The Fund will seek to provide a high total return
on a risk adjusted basis by applying the GDAA Strategy described under
"Aggressive Equity Fund" and investing, through the use of the instruments
described below, in the global equity, global fixed income and currency markets.
The Fund's investments outside the United States will generally be limited to
developed countries.

PORTFOLIO INVESTMENTS

Fixed-income investments will consist primarily of:

- - corporate bonds, debentures and notes

- - non-convertible debt instruments and preferred stocks

- - government, bank and commercial obligations

The Fund may also invest in equity securities and equity-related instruments
such as:

- - common stocks

- - securities convertible into common stocks

- - rights and warrants whose value is based on common stocks

- - depositary receipts relating to equity securities

- - equity swap contracts

The Fund intends to place a substantial portion of its assets in money market
instruments and short-term obligations of high quality, including:

- - U.S. Government Securities

- - bank obligations

- - repurchase and reverse repurchase agreements

- - commercial paper and other investment-grade debt securities

As a defensive tactic in unusual market conditions, the Fund may temporarily
invest without limit in these money market and short-term obligations. This
could potentially keep the Fund from achieving its goal.

To enhance its investment objective incrementally and manage risk, the Fund
intends to use:

- - currency spot and forward contracts

15
<PAGE>

- - currency and interest rate futures contracts

- - option contracts and options on futures contracts

To a lesser extent, the Fund may also purchase or sell contracts relating to the
future delivery of precious metals.

RISK FACTORS

This Fund's principal risk factors are:

- - exposure risk

- - leverage risk

- - risks of derivative instruments

- - foreign securities risk

- - interest rate risk

- - market risk

- - regulatory risk

- - non-diversification risk

The value of your investment in the Fund will fluctuate in response to stock,
bond and currency market movements.

To the extent the Fund invests in foreign securities, the Fund may be affected
by additional risks such as currency, information, political and possibly,
natural event and risks associated with the conversion of the various European
currencies into a single "euro" currency. To the extent that the Fund's foreign
investments at any given time are focused in one particular country or target a
single region, the Fund may be more volatile than a more geographically
diversified fund.

The Fund's transactions in leveraged derivative securities, such as futures
contracts and related options, options on securities and indices and
transactions in currency contracts, carry additional risks, such as correlation,
liquidity, credit, opportunity and regulatory risks.

These risks and other risks which the Fund may be subject to are defined in the
"Risk/Return Summary" or "More About Risk." "More About Risk" also details other
investment practices the Fund may use. Please read "More About Risk" carefully
before you invest.

16
<PAGE>

COMMON INVESTMENT STRATEGIES FOR:

AGGRESSIVE EQUITY FUND
AND
GLOBAL INDEPENDENCE FUND

To realize the funds' investment objectives, the Adviser will be continuously
developing new strategies to take advantage of future market shifts or shifts in
market fundamentals, behavior or patterns. Broadly, however, the funds will
combine various approaches to modern portfolio theory and risk management with
investment themes such as relative value, market arbitrage and directional
trading. Individual position risk and return potential are estimated in a
consistent framework involving the Adviser's judgment and the use of
sophisticated quantitative tools. At the fund level, risk-return trade-offs are
carefully weighted to keep the fund's expected volatility within reasonable
ranges.

RELATIVE VALUE: Using a trading strategy, the funds will seek to exploit the
fundamental and persistent patterns of market behavior between interrelated
assets such as yield curve points, credit points, credit spreads and/or related
market spreads. As an example, a long position in a country's bond market might
be held against a short position with a similar maturity in a bond market of
another country. The related currency position could be taken to mitigate risk,
depending on market circumstances and our fundamental and quantitative analysis.
This differs from classic arbitrage positions as convergence may not be assured
or the date of the convergence may be very distant. The returns on these
transactions would be relatively independent of overall market trends.

DIRECTIONAL TRADING: The funds will take positions which will attempt to capture
gains from changes in volatility or the direction of a particular market. The
Adviser's strategies seek to exploit consistent patterns in the relationships of
fundamental economic and financial variables to the underlying bond and currency
markets. The Adviser will monitor the implicit forecasting relationships using
error-learning statistical processes. The Adviser will use these tools in making
decisions regarding the optimal level of risk to be employed on various
positions.

MODERN PORTFOLIO THEORY: The funds will employ a strategy that uses theoretical
tools in practice which consider risk, return and efficiency. With the
combination of fundamental judgment and quantitative analysis, the Adviser may
select trades not only for these reasons, but for their net return-enhancing or
risk-mitigating properties for the fund as a whole.

RISK MANAGEMENT: The risk management process emphasizes a blending of judgment
with quantitative discipline. The Adviser will monitor and control the targeted
risk-return trade-off throughout the portfolio allocation process and day-to-day
management process. As the basic measure of risk, the Adviser will focus on the
annualized standard deviation of monthly performance. The Adviser will use
daily, weekly and monthly historical data, as well as risk forecasting systems,
to provide measures of the expected standard deviation of the fund. Stress
testing for different economic environments will be performed as another measure
of risk.

The Adviser will seek to target returns for relative value and directional
trading based on the examination of long term themes, short term factors and
relative indicators. To assist in capturing and analyzing these factors, the
Adviser may use a system that has both quantitative and qualitative elements.
The system incorporates a sophisticated and dynamic process which is designed to
forecast the risk and return characteristics of all the assets in a consistent
manner.

The Adviser will also, on a regular basis, compare the correlation of individual
risk factors, projected fund returns, measures of relevant indices and
investment strategies to build a portfolio of securities that attempts to
optimize the risk-return objectives of the fund.

In addition, forecasts of targeted asset return and associated risk measures are
generated using financial and economic inputs. These forecasts are examined and
data is analyzed to promote consistency. External information, which the Adviser
deems to be outside the scope of the initial inputs, is integrated in the
forecasting

17
<PAGE>

process and new forecasts are generated. These forecasts and measures of
forecasting error, as well as the relationships among those errors, are all
generated in a consistent manner allowing for optimization. Optimization of the
portfolio, given the targeted risk-return trade-off, suggests potential
allocations, which are again examined for inconsistencies. These
inconsistencies, if found, tend to highlight potential errors in the information
input or assumptions about relative market movements that a non-quantitative
system would typically overlook. Inconsistencies are then dealt with at the
point of origin, and the system is once against rerun (if necessary). New
allocations are then overlaid on existing asset class positions to generate new
net exposures. Trading based on the resulting portfolio is then implemented.
Adjustments are made whenever the Adviser deems that the environment has changed
dramatically from that assumed in the current portfolio's allocations.

The entire investment process is regularly monitored, upgraded and tested to
promote consistency and integrity for the resulting portfolios and each fund's
objective.

18
<PAGE>

MORE ABOUT RISK

INTRODUCTION

A fund's risk profile is largely defined by the fund's investment goal and
principal strategies. You will find a concise description of each fund's risk
profile in "Risk/Return Summary - Investment Goals and Principal Strategies."
The fund-by-fund discussions contain more detailed information.

In addition to the risks previously discussed, the funds may use certain
investment practices that have high risks and opportunities associated with
them. However, each fund has limitations and policies designed to reduce these
risks. To the extent a fund utilizes these securities or practices, its overall
performance may be affected, either positively or negatively. The "Investment
Practices" table in this section briefly describes these practices and the
limitations on their use, as well as the risks associated with them.

TYPES OF INVESTMENT RISK

ACCESS RISK The risk that some countries may restrict a fund's access to
investments or offer terms that are less advantageous than those for local
investors. This could limit the attractive investment opportunities available to
a fund.

CORRELATION RISK The risk that the relationships between markets are not
contemplated in the investment decision-making process. Incomplete correlation,
or inaccurately forecasted correlation, can result in unanticipated risks.

CREDIT RISK The risk that the issuer of a security, or the counterparty to a
contract, will default or otherwise become unable to honor a financial
obligation.

EURO CONVERSION RISK. The risk that the planned introduction of a single
European currency, the euro, beginning on January 1, 1999 for participating
European nations may result in complex conversion calculations and other unique
uncertainties that could cause market disruptions before or after the
introduction and adversely affect the value of foreign securities held by a
fund. CDC Investments is working to address euro-related issues and understands
that other key service providers are taking similar steps, but the impact on the
funds cannot be predicted.

LIQUIDITY RISK The risk that certain securities may be difficult or impossible
to sell at the time and the price that the seller would like. The seller may
have to lower the price, sell other securities instead or forego an investment
opportunity. Any of these could have a negative effect on fund management or
performance.

MANAGEMENT AND OPPORTUNITY RISK The risk that a strategy used by a fund's
management may fail to produce the intended result. The risk of missing out on
an investment opportunity because the assets necessary to take advantage of it
are tied up in other investments. These risks are common to all mutual funds.

NATURAL EVENT RISK The risk of losses attributable to natural disasters, crop
failures and similar events.

OPERATIONAL RISK The risk that some countries may have less developed securities
markets (and related transaction, registration and custody practices).

PREPAYMENT AND EXTENSION RISKS The risk that the term of a mortgage or
asset-backed pool of securities in which a fund may invest may be shortened by
unscheduled or early payments of principal on underlying mortgages or assets, or
extended under certain circumstances. Prepayments and extensions may cause the
yield on such securities to differ from the expected yield based on assumed
average life. Reinvestments of prepayments may occur at higher or lower interest
rates than the original investment and affect a fund's yield.

19
<PAGE>

TRADING LIMIT AND TRADING HALT RISK. Exchanges on which options and futures
contracts are traded, such as the Chicago Mercantile Exchange, have established
limits on how much an option or futures contract may decline over various time
periods within a day. If an option or futures contract's price declines more
than the established limits, no trading may occur at prices outside that limit.
If a trading limit is reached before the close of a trading day, a Fund may not
be able to purchase or sell options or futures contracts at advantageous prices
or at all. In such an event, the Fund also may be required to use a "fair-value"
method to price its outstanding contracts. In addition, the Chicago Mercantile
Exchange imposes intraday 10 minute trading halts when trades occur at specified
limits within the various time periods.

VALUATION RISK The risk that a fund has valued certain of its securities at a
higher price that it can sell them for.

YEAR 2000 PROCESSING RISK. The risk that a fund is adversely affected if the
computer systems used by the Adviser or other service providers do not correctly
handle the change from "99" to "00" on January 1, 2000. CDC Investments is
working to avoid such problems and to obtain assurances from service providers
that they are taking similar steps. However, there can be no assurance that
these efforts will be entirely successful. The Year 2000 issue affects
practically all companies, organizations, governments and markets throughout the
world -- including companies or governmental entities in which the funds invest.
To the extent that the impact on a fund's holdings or on the global markets or
economies is negative, it could adversely affect a fund's returns.

20
<PAGE>

OTHER INVESTMENT PRACTICES
<TABLE>
<CAPTION>

- ------------------------------------------------------------------------------------------------------------------------
This table shows each fund's limitations on certain investment practices. Global
In each case the significant types of risk are listed, which are defined U.S. Core Aggressive Independence
elsewhere in this prospectus. Equity Fund Equity Fund Fund
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>

ASSET-BACKED SECURITIES Interests in pools of assets such as receivables -- + +
from credit card and automobile loans. CREDIT, PREPAYMENT AND EXTENSION,
LIQUIDITY, INTEREST RATE RISKS.
- ------------------------------------------------------------------------------------------------------------------------
BELOW INVESTMENT GRADE DEBT SECURITIES Debt securities rated below BBB by -- 10% 10%
Moody's Investors Service, Inc. or Baa by Standard & Poor's Ratings Service
(or of comparable quality, if unrated) are considered junk bonds. CREDIT,
MARKET, INTEREST RATE, LIQUIDITY, VALUATION, INFORMATION RISKS.
- ------------------------------------------------------------------------------------------------------------------------
BORROWING The borrowing of money from banks for temporary or emergency
purposes in order to facilitate management of the fund. EXPOSURE, LEVERAGE 33 1/3 33 1/3 33 1/3
RISKS.
- ------------------------------------------------------------------------------------------------------------------------
MORTGAGE-BACKED SECURITIES Debt securities backed by pools of mortgages, -- + +
including pass-through certificates and other senior classes of
collateralized mortgage obligations (CMOs). CREDIT, PREPAYMENT AND
EXTENSION, LIQUIDITY, INTEREST RATE RISKS.
- ------------------------------------------------------------------------------------------------------------------------
RESTRICTED AND OTHER ILLIQUID SECURITIES Securities with restrictions on 15 15 15
trading or those not actively traded on the open market. LIQUIDITY,
VALUATION, MARKET RISKS.
- ------------------------------------------------------------------------------------------------------------------------
SECURITIES LENDING Lending portfolio securities to financial institutions; 50% -- --
a fund receives cash, U.S. government securities or bank letters of credit
as collateral. CREDIT, LIQUIDITY, MARKET, OPERATIONAL RISKS.
- ------------------------------------------------------------------------------------------------------------------------
SHORT SALES AND SHORT SALES AGAINST THE BOX The selling of securities that 10% -- --
have been borrowed on the expectation that the market price will drop.
- - HEDGED. LEVERAGE, MARKET, CORRELATION, LIQUIDITY, OPPORTUNITY RISKS.
- - SPECULATIVE. LEVERAGE, MARKET, LIQUIDITY RISKS.
- ------------------------------------------------------------------------------------------------------------------------
SHORT-TERM TRADING Selling a security shortly after purchase. A fund + + +
engaging in short-term trading will have higher turnover and transaction
expenses. Increased short-term capital gains distributions could raise
shareholders' income tax liability. MARKET RISK.
- ------------------------------------------------------------------------------------------------------------------------
TEMPORARY DEFENSIVE TACTICS Placing some or all of a fund's assets in + + +
investments such as money market obligations and investment-grade debt
securities for defensive purposes. Although intended to avoid losses in
unusual market conditions, defensive tactics might prevent a fund from achieving
its goal.
- ------------------------------------------------------------------------------------------------------------------------
WARRANTS Options issued by a company granting the holder the right to buy 10% 10% 10%
certain securities, generally common stock, at a specified price and usually for
a limited time. LIQUIDITY, MARKET, EXPOSURE RISKS.
- ------------------------------------------------------------------------------------------------------------------------
WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS The purchase or sale of 20% 20% 20%
securities for delivery at a future date; market value may change before
delivery. MARKET, LIQUIDITY, EXPOSURE, OPPORTUNITY, LEVERAGE RISKS.
- ------------------------------------------------------------------------------------------------------------------------
ZERO COUPON BONDS Debt securities that pay no cash income to holders until 20% 20% 20%
maturity and are issued at a discount from maturity value. At maturity, the
entire return comes from the difference between purchase price and maturity
value. INTEREST RATE RISK.
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>

KEY TO TABLE:

* No policy limitation on usage

+ Permitted, but not typically used

- -- Not permitted
Numbers shown indicate percentages:
20 ITALIC TYPE represents percent of total assets
20 roman type represents percent of net assets

21
<PAGE>

MANAGEMENT

ABOUT THE ADVISER

The board of trustees of CDC MPT+ Funds supervises each fund's business affairs.

The board has selected CDC Investment Management Corporation, to manage the
funds. It is responsible for:

- - investing each fund's assets according to its goal and strategy

- - placing buy and sell orders

- - managing day-to-day operations and business activities

- - providing office space and equipment

CDC Investment Management Corporation was formed as a New York corporation in
1990 and is a registered investment adviser under the Investment Advisers Act of
1940, as amended. CDC Investments is an established leader in providing
alternative investment strategies for institutional clients. CDC Investments
strives to develop products and strategies which will provide its clients with
superior risk-adjusted performance that is not well correlated with traditional
stock and bond market indices. As of September 1998, CDC Investments has
approximately $3 billion in assets under management, providing asset management
services to large European, Asian and North American financial institutions,
family offices, fund of funds, pension funds and other investors.

CDC Investments is the wholly owned, U.S.-based, asset management subsidiary of
Caisse des Depots et Consignations ("CDC Group"), one of the world's largest
financial institutions with a "AAA" credit rating on its senior long-term debt.
Headquartered in Paris, CDC Group has nearly a 180 year record of providing
financial services. With autonomous subsidiaries in New York, Frankfurt and
Tokyo, the CDC Group specializes in investment management, capital market and
other financial activities, savings and life insurance, fiduciary services and
public finance. CDC Investments was founded as part of a strategic expansion to
provide world-class investment services in the United States and to expand its
asset management expertise and products for the European asset management
subsidiaries.

The Adviser's offices are located at:

9 West 57th Street, 35th Floor
New York, NY 10019

MANAGEMENT FEES

The U.S. Core Equity Fund pays the Adviser a basic fee of 1.00%, and the
Aggressive Equity Fund and the Global Independence Fund each pay the Adviser a
basic fee of 1.50%, of the respective fund's average daily net assets. This
basic management fee may be adjusted upward or downward by applying an
adjustment formula (the "Performance Adjustment"). The Performance Adjustment is
calculated monthly by comparing the Fund's investment performance to a target
during the most recent twelve-month period. The target for the U.S. Core Equity
Fund and the Aggressive Equity Fund is the investment record of the S&P 500
Index, and the target for the Global Independence Fund is the investment record
of the 90-day U.S. Treasury bill rate. The difference between the fund's
performance compared to the performance of the relevant target is multiplied by
a Performance Adjustment of 25% (as an annual rate). The Performance Adjustment
is then added to or subtracted from the basic fee. The maximum annualized
Performance Adjustment is 1.00% for the U.S. Core Equity Fund and 1.50% for each
of the Aggressive Equity Fund and the Global Independence Fund.

22
<PAGE>

Here are examples of how the Performance Adjustment would work (using annual
rates):
<TABLE>
<CAPTION>

- ---------------------------------------------------------------------------------------------------------------------
U.S. Core Equity Fund
- ---------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------
Total Fund Performance Basic Management Total Management
(before Management fee) Relevant Index Excess Performance Fee Fee Adjustment Fee
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
-10.00% -15.00% 5.00% 1.00% 1.00% 2.00%
- ---------------------------------------------------------------------------------------------------------------------

-5.00% 5.00% -10.00% 1.00% -1.00% 0.00%
- ---------------------------------------------------------------------------------------------------------------------

4.00% 5.00% -1.00% 1.00% -0.25% 0.75%
- ---------------------------------------------------------------------------------------------------------------------

5.00% 5.00% 0.00% 1.00% 0.00% 1.00%
- ---------------------------------------------------------------------------------------------------------------------

6.00% 5.00% 1.00% 1.00% 0.25% 1.25%
- ---------------------------------------------------------------------------------------------------------------------

10.00% 5.00% 5.00% 1.00% 1.00% 2.00%
- ---------------------------------------------------------------------------------------------------------------------

15.00% 5.00% 10.00% 1.00% 1.00% 2.00%
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>

Aggressive Equity Fund and Global Independence Fund
- ---------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------
Total Fund Performance Relevant Basic Management Total Management
(before Management fee) Index Excess Performance Fee Fee Adjustment Fee
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
-10.00% -15.00% 5.00% 1.50% 1.25% 2.75%
- ---------------------------------------------------------------------------------------------------------------------

-5.00% 5.00% -10.00% 1.50% -1.50% 0.00%
- ---------------------------------------------------------------------------------------------------------------------

2.00% 5.00% -3.00% 1.50% -0.75% 2.25%
- ---------------------------------------------------------------------------------------------------------------------

5.00% 5.00% 0.00% 1.50% 0.00% 1.50%
- ---------------------------------------------------------------------------------------------------------------------

8.00% 5.00% 3.00% 1.50% 0.75% 2.25%
- ---------------------------------------------------------------------------------------------------------------------

12.00% 5.00% 7.00% 1.50% 1.50% 3.00%
- ---------------------------------------------------------------------------------------------------------------------

15.00% 5.00% 10.00% 1.50% 1.50% 3.00%
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>

Each fund's performance is calculated based on its net asset value per share
after expenses but before the management fee.

For purposes of calculating the Performance Adjustment, any dividends or
capital gains distributions paid by a fund are treated as if those
distributions were reinvested by shareholders in fund shares at the net asset
value per share as of the record date for payment. The performance record for
the S&P 500 Index is based on the change in value of the Index, and is
adjusted for any cash distributions from the companies whose securities
comprise the Index. The performance record for the 90-day U.S. Treasury bill
rate is based upon the U.S. Treasury Yield Convention for the most recently
issued "on the run" 90-day Treasury bill quoted on page "GOV PX" of the
Bloomberg Financial Markets Service (or on any successor or substitute page
of such Service, or any successor to or substitute for such Service,
providing rate quotations comparable to those currently provided on such page
of such Service).

Because the adjustment to the basic fee is based on the comparative performance
of the fund and the record of the corresponding index, the controlling factor
(regarding the Performance Adjustment to the basic fee) is not whether the
fund's performance is up or down, but whether it is up or down more or less than
the performance record of the corresponding index. Moreover, the comparative
investment record of the fund is based solely on the relevant performance period
without regard to the cumulative performance over a longer or shorter period.

23
<PAGE>

MEET THE MANAGERS

The day-to-day portfolio management of each of the funds is managed by the
following teams of investment professionals. Each person joined CDC Investments
in 1997 and has been a co-portfolio manager of the relevant fund since its
inception. Each portfolio manager's title with CDC Investments appears next to
his name.

U.S. CORE EQUITY FUND

BLUFORD H. PUTNAM, Ph.D., President and
Chief Investment Officer
- Managing Director and Chief Investment
Officer for Equities and Asset Allocation
with the Global Investment Management
Department of Bankers Trust Company (NY)
from 1994 to 1997

- President of Putnam & Associates, Inc. from
1991 to 1994

- Director and Chief Economist at Kleinwort
Benson Ltd. (London) from 1989 to 1991

- Visiting Professor at St. Mary's College,
1988 to 1989

- Principal and Head of the international
fixed income strategy team at Morgan Stanley
& Co. from 1984 to 1988

- Partner with Stern Stewart & Co. from 1982
to 1984

- Economist with Chase Manhattan Bank from
1978 to 1982

- Economist with the Federal Reserve Bank of
New York from 1976 to 1978

JOSE QUINTANA, Ph.D., Managing Director
- Vice President and Head of Quantitative
Research for the Strategic Asset Allocation
team in the Global Investment Management
Group of Bankers Trust Company from 1994 to
1997

- Vice President in the Global Risk Management
Sector of Chase Manhattan Bank from 1992 to
1994

- Vice President at Chase Investors Management
Corporation from 1988 to 1992

- Staff Supervisor for AT&T's Market Analysis
and Forecasting Directorate from 1987 to
1988

JASON WOLIN, Vice President and
Portfolio Manager
- Portfolio Manager at Bankers Trust
Company from 1994 to 1997

- Project Manager (Financial Systems Group) at
JP Morgan & Co. from 1992 to 1994

FRANK HANLEY, Vice President
- Worked as a proprietary trader with Spear,
Leeds & Kellog from 1995 to 1997

- Worked as a head trader for Gabelli & Co.
Inc./GAMCO Investors from 1984 to 1995

24
<PAGE>

AGGRESSIVE EQUITY FUND
AND GLOBAL INDEPENDENCE
FUND BLUFORD H. PUTNAM, Ph.D., President
- See above

JOSE QUINTANA, Ph.D., Managing Director
- See above

D. SYKES WILFORD, Ph.D., Managing Director
- Chief Investment Officer of Bankers Trust
Private Bank and Managing Director of
Bankers Trust Global Investment Management
from 1994 to 1997

- Managing Director of Chase Investment Bank,
Ltd., London from 1992 to 1994

- Managing Director of Chase Manhattan Bank,
responsible for Risk Management product
development and marketing from 1988 to 1992

- Chief International Fixed Income Strategist
for Drexel Burnham Lambert (London) from
1987 to 1988

- Managing Director of Chase Manhattan Bank
from 1977 to 1987

- Economist with the Federal Reserve Bank of
New York from 1976 to 1977

ANDREW DALTON, Director

- Vice President at Bankers Trust Company from
1995 to 1997

- Worked on the development and implementation
of global asset allocation models for Chase
Manhattan Bank 1992 to 1995

PRIOR PERFORMANCE OF SIMILAR PORTFOLIOS MANAGED BY THE ADVISER

The statistics below show the performance of three other unregistered
investment portfolios managed by CDC Investments. In managing the Funds, CDC
Investments will employ substantially the same investment objectives,
policies and strategies that it employs in managing the corresponding
portfolios described below. However, in managing the Fund, CDC Investments
will be subject to certain rules imposed on registered investment companies
(e.g., limits on the percentage of assets invested in securities of issuers
in a single industry, limits on futures trading and requirements on
distributing income to shareholders) that do not apply to the unregistered
portfolios. In addition, the continuous offering of the Fund's shares and the
Fund's obligation to redeem its shares will likely cause the Fund to
experience cash flows different from those of the corresponding portfolio.
Moreover, the way of calculating the performance of the portfolios, which
value their assets at the end of each month, differs from the method
employed by mutual funds, which among other things value their assets on a
daily basis. All of these factors may affect the performance of the Funds
and cause it to differ from that of the corresponding portfolio.

The performance returns shown below are for the period from the commencement of
the relative portfolio's operations through December 31, 1998, and, in the case
of the Global Independence Portfolio described below, for the year ended
December 31, 1998.

Fees and expenses incurred in the operation of the portfolios differ from and
are lower than the fees and expenses expected to be incurred by the
corresponding Funds. Accordingly, the performance results for each portfolio
have been adjusted to reflect the overall expense ratio expected to be borne by
the corresponding Fund in its first fiscal year and the management fee and
applicable Performance Adjustment that would have been charged given the
actual performance of the relevant index over the period shown.

25
<PAGE>

THE PERFORMANCE DATA REPRESENTS THE PRIOR PERFORMANCE OF THE PORTFOLIOS, NOT THE
PRIOR PERFORMANCE OF THE FUNDS, AND SHOULD NOT BE CONSIDERED AN INDICATION OF
OR A SUBSTITUTE FOR FUTURE PERFORMANCE OF ANY OF THE FUNDS.

U.S. CORE EQUITY FUND. Set forth below is the performance of an unregistered,
privately-offered investment portfolio (the "U.S. Equity Portfolio"), which
commenced operations on January 5, 1998 and employs substantially the same
investment objectives, policies and strategies as the U.S. Core Equity Fund.
Returns of the U.S. Equity Portfolio are compared to the S&P 500 Index. Unlike
the U.S. Equity Portfolio's net returns, those of the S&P 500 Index, an
unmanaged index, do not reflect fees and expenses. Both the returns of the
U.S. Equity Portfolio and the S&P 500 Index reflect the reinvestment of
dividends and distributions.
<TABLE>
<CAPTION>

Net of Fees Gross of Fees
----------- -------------
<S> <C> <C>

U.S. Core Equity Portfolio _________ % _________ %

S&P 500 Index _________ % _________ %
</TABLE>

AGGRESSIVE EQUITY FUND. Set forth below is the performance of a separately
managed private account (the "Aggressive Equity Portfolio"), which commenced
operations on July 1, 1998 and employs substantially the same investment
objectives, policies and strategies as the Aggressive Equity Fund. Returns of
the Aggressive Equity Portfolio are compared to the S&P 500 Index. Unlike the
Aggressive Equity Portfolio's net returns, those of the S&P 500 Index do not
reflect fees and expenses. Both the returns of the Aggressive Equity Portfolio
and the S&P 500 Index reflect the reinvestment of dividends and distributions.

Net of Fees Gross of Fees
----------- -------------
<S> <C> <C>

Aggressive Equity Portfolio _________ % _________ %

S&P 500 Index _________ % _________ %
</TABLE>

GLOBAL INDEPENDENCE FUND. Set forth below is the performance of a mutual fund
registered under the laws of Luxembourg (the "Global Independence Portfolio"),
which commenced operations on October 1, 1997 and employs substantially the same
investment objectives, policies and strategies as the Global Independence Fund.
Returns of the Global Independence Portfolio are compared to the 90-day U.S.
Treasury bill rate. Unlike the Global Independence Portfolio's net returns,
those of the 90-day U.S. Treasury bill rate do not reflect fees and expenses.
Both the returns of the Global Independence Portfolio and the 90-day U.S.
Treasury bill rate reflect the reinvestment of dividends and distributions,
if any.

Since Inception Year Ended December 31
--------------------------- ---------------------------
Net of Fees Gross of Fees Net of Fees Gross of Fees
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>

Global Independence Portfolio _________ % _________ % _________ % _________%

90-Day U.S. Treasury bill rate _________ % _________ % _________ % _________%
</TABLE>

ACCOUNT POLICIES

PRICING OF SHARES

You pay no sales charges to invest in the funds. When you invest in a fund, you
pay the net asset value (NAV) per Institutional share or Investor share, as
appropriate. Your purchase or redemption order will be priced at the next NAV
calculated after your order is accepted by the Fund.

26
<PAGE>

The NAV is determined at the close of regular trading on the New York Stock
Exchange (typically 4 p.m. Eastern time) each day the Exchange is open for
business. It is calculated by dividing total assets of the fund's relevant class
of shares, less all liabilities, by the number of the relevant class of shares
outstanding.

Each fund's assets are valued primarily on the basis of market quotations.
Short-term securities with remaining maturities of sixty days or less for which
quotations are not readily available are valued on the basis of amortized cost.
This method minimizes the effect of changes in a security's market value.
Foreign securities are valued on the basis of quotations from the primary market
in which they are traded, and are translated from the local currency into U.S.
dollars using current exchange rates. Options are generally valued at the last
sale price or, in the absence of a last sale price, the last bid price. The
value of a futures contract equals the unrealized gain or loss on the contract
that is determined by marking it to the current settlement price for a like
contract acquired on the day on which the futures contract is being valued. A
settlement price may not be used if the market makes a limit move with respect
to a particular commodity. In addition, if quotations are not readily available,
or if the values have been materially affected by events occurring after the
closing of a foreign market, assets may be valued by another method that the
Board of Trustees believes accurately reflects fair value.

BUYING AND SELLING SHARES

Each fund is open on those days when the New York Stock Exchange is open,
typically Monday through Friday. Fund shares will not be priced on major
national holidays recognized in New York and other days when the Exchange is
closed for trading.

If we receive your purchase or redemption request in correct form by 4 p.m. ET,
your transaction will be priced at that day's NAV. If we receive it after 4
p.m., it will be priced at the next business day's NAV.

You can also purchase fund shares through financial services firms such as
banks, brokers and investment advisers. Where authorized, your order will be
priced at the NAV next computed after your financial services firm has accepted
it.

All investments must be in U.S. dollars. Third-party checks cannot be accepted.
You may be charged a fee for any check that does not clear.

When selling shares, your order will be processed promptly and you will
generally receive the proceeds within a week.

Some circumstances require written sell orders, along with signature guarantees.
These include:

- - amounts of $100,000 or more

- - amounts of $1,000 or more on accounts whose address has been changed
within the last 30 days

- - requests to send the proceeds to a different payee or address

A signature guarantee helps protect against fraud. You can obtain one from most
banks or securities dealers, but not from a notary public. Please call us to
ensure that your signature guarantee will be processed correctly.

MINIMUM INITIAL AND SUBSEQUENT INVESTMENTS:

INSTITUTIONAL SHARES: $1,000,000

INVESTOR SHARES: $2,500

27
<PAGE>

In its discretion, subject to review by the board of trustees, the Adviser may
waive these minimum investment requirements. Without limiting this discretion,
the Adviser intends to waive the minimum on investments in Institutional shares
for employees of the Adviser and its affiliates, and for the spouse, parents,
children, siblings, grandparents or grandchildren of these employees.

ACCOUNT STATEMENTS

In general, you will receive account statements as follows:

- - after every transaction that affects your account balance (except for
distribution reinvestments and automatic purchases)

- - after any changes of name or address of the registered owner(s)

- - otherwise, every month

You will receive annual and semiannual financial reports. Every year you also
should receive, if applicable, a Form 1099 tax information statement mailed by
January 31.

SHAREHOLDER SERVICES

AUTOMATIC SERVICES

Buying or selling shares automatically is easy with the services described
below. With each service, you select a schedule and amount, subject to certain
restrictions. You can set up most of these services with your application or by
calling 1-800___-____.

FOR BUYING SHARES:

AUTOMATIC INVESTMENT PLAN For making automatic investments
from a designated bank account.

PAYROLL DEDUCTION PLAN For making automatic investments
through a payroll deduction.

GOVERNMENT DIRECT DEPOSIT PRIVILEGE For making automatic investments
from your federal employment,
Social Security or other regular
federal government check.

FOR BUYING AND FOR SELLING SHARES:

AUTO-EXCHANGE PRIVILEGE For making regular exchanges
from one fund into another.

FOR SELLING SHARES:

AUTOMATIC WITHDRAWAL PLAN For making regular withdrawals
from the funds.

EXCHANGE PRIVILEGE

You can exchange $1,000,000 or more of the Institutional shares and $2,500 or
more of the Investor shares from one fund into the same class of shares of
another fund (no minimum for retirement accounts). You can request

28
<PAGE>

your exchange in writing or by phone. Be sure to read the fund description in
the current prospectus for any fund into which you are exchanging. Any new
account established through an exchange will have the same privileges as your
original account (as long as they are available). No fee is currently charged on
exchanges.

TELEPHONE PRIVILEGE

To move money between your bank account and your fund account with a phone call,
use the telephone privilege. You can set up this privilege on your account by
providing bank account information and following the instructions on your
application.

GENERAL POLICIES

If your account falls below $500, the fund may ask you to increase your balance.
If it is still below $500 after 45 days, the fund may close your account and
send you the proceeds.

Unless you decline telephone privileges on your application, you may be
responsible for any fraudulent telephone order as long as the fund takes
reasonable measures to verify the order.

Each fund reserves the right to:

- - refuse any purchase or exchange request that could adversely affect the
fund or its operations, including those from any individual or group who,
in the fund's view, is likely to engage in excessive trading (usually
defined as more than four exchanges out of the fund within a calendar year)

- - refuse any purchase or exchange request in excess of 1% of the fund's
total assets

- - change or discontinue its exchange privilege, or temporarily suspend this
privilege during unusual market conditions

- - change its minimum investment amounts

- - delay sending out redemption proceeds for up to seven days if doing so
sooner would adversely affect the fund (generally applies only in cases of
very large redemptions, excessive trading or during unusual market
conditions)

- - make a "redemption in kind" -- payment in portfolio securities rather than
cash -- if the amount you are redeeming is large enough to affect fund
operations

INVESTMENT THROUGH INTERMEDIARIES

If you invest through a third party (rather than directly through the funds'
distributor), the policies and fees may be different than those described here.
Banks, brokers, 401(k) plans, financial advisers and financial supermarkets may
charge transaction fees and may set different minimum investments or limitations
on buying or selling shares. Consult a representative of your plan or financial
institution if in doubt.

Financial services firms selling significant amounts of fund shares may receive
extra compensation. This compensation, which the Adviser will pay out of its own
resources, may include non-cash promotional incentives as well as reimbursement
for marketing costs. From time to time, we may provide opportunities for you or
your financial representative to attend business meetings, conferences, training
programs or other events. Travel, meals and lodging may be included. To find out
more about promotional events in your area, please contact your financial
representative.

DISTRIBUTION POLICIES AND TAXES

29
<PAGE>

DISTRIBUTIONS

As a fund investor, you are entitled to your share of the fund's net income and
gains on its investments. The fund passes these earnings along to its
shareholders as distributions.

Each fund earns dividends from stocks and interest from bond, money market and
other investments. These are passed along as dividend distributions. A fund
realizes capital gains whenever it sells securities for a higher price than it
paid for them. These are passed along as capital gain distributions, a portion
of which may be taxable to you as ordinary income.

Each fund distributes its net income at least annually. All of the funds
distribute capital gains annually, usually in November or December.

DISTRIBUTION OPTIONS

When you open an account, specify on your application how you want to receive
your distributions. Each fund offers the following options:

- - REINVESTMENT OPTION Your dividend and capital gain distributions will be
automatically reinvested in additional shares of the fund. You will be
assigned this option unless you indicate a different choice.

- - INCOME-EARNED OPTION Your capital gain distributions will be automatically
reinvested, but you will receive dividend distributions by check or
electronic transfer.

- - CAPITAL GAINS OPTION Your dividend distributions will be automatically
reinvested, but you will receive capital gain distributions by check or
electronic transfer.

- - CASH OPTION You will receive your dividend and capital gain distributions
by check or electronic transfer.

For retirement accounts, all distributions are automatically reinvested. When
you are over 59 1/2 years old, you can receive distributions in cash.

TAXES

As with any investment, you should consider how your investment in a fund will
be taxed. Unless your account is an IRA or other tax-advantaged account, you
should be aware of the potential tax implications. Please consult your tax
professional concerning your own tax situation.

TAXES ON DISTRIBUTIONS

As long as a fund continues to meet the requirements for being a tax-qualified
regulated investment company, it pays no federal income tax on the earnings it
distributes to shareholders.

Consequently, distributions you receive from a fund, whether reinvested or taken
in cash, are generally considered taxable. Distributions from a fund's long-term
capital gains are taxed as capital gains; distributions from other sources are
generally taxed as ordinary income.

If you buy shares shortly before or on the "record date" -- the date that
establishes you as the person to receive the upcoming distribution -- you will
receive a portion of the money you just invested in the form of a taxable
distribution. Some dividends paid in January may be taxable as if they had been
paid the previous December.

30
<PAGE>

If you fail to provide your correct taxpayer identification number on your
application, or you have been notified by the IRS that you are subject to backup
withholding, the funds may withhold 31% of all distributions to you for federal
taxes. In the case of an individual, your taxpayer identification number is your
social security number.

The form 1099 that is mailed to you every January details your distributions and
their federal tax category.

TAXES ON TRANSACTIONS

Any time you sell or exchange shares, it is considered a taxable event for you.
Depending on the purchase price and the sale price of the shares you sell or
exchange, you may have a gain or loss on the transaction. You are responsible
for any tax liabilities generated by your transactions.

FUND DETAILS

MULTI-CLASS STRUCTURE

Each fund offers two no-load classes of shares, called Institutional and
Investor.

Institutional shares are sold directly by the funds' distributor. They may
be purchased by endowments, foundations and plan sponsors of 401(a),
401(k), 457 and 403(b) plans and by individuals.

Investor shares may be purchased by intermediary financial institutions
(including broker-dealers, investment advisers, financial planners, banks and
insurance companies), and certain individual retirement accounts and
individuals. Investment professionals may purchase Investor shares for
discretionary or non-discretionary accounts maintained by individuals.

Shares of each class represent equal pro rata interests in the funds. Each class
accrues dividends and calculates its net asset value and performance the same
way. But because of their higher fees, Investor shares will generally have a
lower total return than Institutional shares.

ABOUT THE DISTRIBUTOR

___________ is the funds' distributor and is responsible for:

- - making the funds available to you;

- - account servicing and maintenance; and

- - sub-transfer agency services, sub-accounting services and administrative
services related to the sale of shares.

As part of their business strategies, each fund has adopted a Rule 12b-1
shareholder servicing and distribution plan with respect to Investor shares to
compensate the distributor for its services. Under the plan, the distributor
receives fees at an annual rate of 0.25% of the average daily net assets of the
fund's Investor shares.

Rule 12b-1 is the federal securities regulation authorizing fees of this type.
Because the fees are paid out of a fund's assets on an ongoing basis, over time
they will increase the cost of an investment in Investor shares and may cost you
more than paying other types of sales charges.

The distributor receives no compensation with respect to sales of Institutional
shares. It provides shareholder and distribution services to these shareholders
at no charge.

31
<PAGE>

ADDITIONAL INFORMATION

Additional documents are available that offer further information about the
funds:

ANNUAL/SEMIANNUAL REPORT TO SHAREHOLDERS

Includes financial statements, portfolio investments, detailed performance
information, a statement from portfolio management and the independent
accountants' report.

The annual report also provides a discussion of the market conditions and
investment strategies that significantly affected fund performance during the
last fiscal year.

STATEMENT OF ADDITIONAL INFORMATION (SAI)

Provides more details about the funds and their investments. A current SAI has
been filed with the Securities and Exchange Commission and is incorporated by
reference. You may visit the Commission's Internet Website (www.sec.gov) to view
the SAI, other material incorporated by reference, and other information. You
can also get copies of this information by writing to the Commission and paying
a duplicating fee. Write to:

Securities and Exchange Commission
Public Reference Section
Washington, D.C. 20540-6009.

You may review and copy information about the funds, including the SAI, at the
Securities and Exchange Commission's Public Reference Room in Washington, D.C.
To find out more about the public reference room, call the Commission at
1-800-SEC-0330.

Please contact CDC MPT+ Funds to obtain more information about the funds,
inquire about your account or request a free copy of the current
annual/semi-annual report or SAI:

By mail:

CDC MPT+ Funds
[Address to be Provided]

By overnight or courier service:

[ADDRESS TO BE PROVIDED BY ADMINISTRATOR]

By telephone:
800-___ - ____

Via the internet:
[www.________.com]

SEC File No. 811-_____

32
<PAGE>
The information in this Statement of Additional Information is not complete and
may be changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
Statement of Additional Information is not an offer to sell these securities and
is not soliciting an offer to buy these securities in any state where the offer
or sale is not permitted.

Subject to Completion, dated October 28, 1998

STATEMENT OF ADDITIONAL INFORMATION

[ ], 1998

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

CDC MPT+ FUNDS

U.S. CORE EQUITY FUND
AGGRESSIVE EQUITY FUND
GLOBAL INDEPENDENCE FUND

This Statement of Additional Information is meant to be read in
conjunction with the Prospectus for the Institutional shares and the Investor
shares of CDC MPT+ Funds (the "Trust"), dated , 1998 as amended or
supplemented from time to time (the "Prospectus"), and is incorporated by
reference in its entirety into the Prospectus. The Trust currently offers three
separately managed portfolios: U.S. Core Equity Fund, Aggressive Equity Fund and
Global Independence Fund (together the "Funds" and each a "Fund"). Because this
Statement of Additional Information is not itself a prospectus, no investment in
shares of a Fund should be made solely upon the information contained herein.
Copies of the Funds' Prospectus and information regarding the Funds' current
performance may be obtained by calling the Funds at (800) [ ].
Information regarding the status of shareholder accounts may be obtained by
calling the Funds at (800) [ ] or by writing to the Funds at 9 West
57th Street, New York, New York 10019.

<PAGE>

TABLE OF CONTENTS

PAGE

Organization of the Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Investment Objectives and Policies . . . . . . . . . . . . . . . . . . . . . . 1
Options, Swaps, Futures and Currency Exchange Transactions. . . . . . . . 1
Securities Options . . . . . . . . . . . . . . . . . . . . . . . . . 2
Stock Index Options. . . . . . . . . . . . . . . . . . . . . . . . . 4
OTC Options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Futures Activities . . . . . . . . . . . . . . . . . . . . . . . . . 6
Futures Contracts . . . . . . . . . . . . . . . . . . . . . . . 6
Options on Futures Contracts. . . . . . . . . . . . . . . . . . 7
Currency Exchange Transactions . . . . . . . . . . . . . . . . . . . 8
Forward Currency Contracts. . . . . . . . . . . . . . . . . . . 8
Currency Options. . . . . . . . . . . . . . . . . . . . . . . . 9
Hedging . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Swaps. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
Asset Coverage for Forward Contracts, Options, Futures and
Options on Futures . . . . . . . . . . . . . . . . . . . . . . . .11
U.S. Government Securities. . . . . . . . . . . . . . . . . . . . . . . .11
Money Market Obligations. . . . . . . . . . . . . . . . . . . . . . . . .12
Bank Obligations . . . . . . . . . . . . . . . . . . . . . . . . . .12
Commercial Paper . . . . . . . . . . . . . . . . . . . . . . . . . .13
Other Short-Term Corporate Obligations . . . . . . . . . . . . . . .13
Additional Information on Other Investment Practices. . . . . . . . . . .13
Foreign Investments. . . . . . . . . . . . . . . . . . . . . . . . .13
Foreign Debt Securities . . . . . . . . . . . . . . . . . . . .15
Emerging Markets. . . . . . . . . . . . . . . . . . . . . . . .16
Depositary Receipts. . . . . . . . . . . . . . . . . . . . . . . . .16
Fixed Income Securities. . . . . . . . . . . . . . . . . . . . . . .16
Securities of Other Investment Companies . . . . . . . . . . . . . .16
When-Issued Securities, Delayed-Delivery Transactions and Forward
Commitments. . . . . . . . . . . . . . . . . . . . . . . . . . . .17
Repurchase Agreements. . . . . . . . . . . . . . . . . . . . . . . .17
Reverse Repurchase Agreements and Dollar Rolls . . . . . . . . . . .18
Loan Participations and Assignments. . . . . . . . . . . . . . . . .19
Zero Coupon Securities . . . . . . . . . . . . . . . . . . . . . . .19
Convertible Securities . . . . . . . . . . . . . . . . . . . . . . .20
Mortgage-Backed Securities . . . . . . . . . . . . . . . . . . . . .21
Asset-Backed Securities. . . . . . . . . . . . . . . . . . . . . . .22
Structured Notes . . . . . . . . . . . . . . . . . . . . . . . . . .22
Non-Publicly Traded and Illiquid Securities. . . . . . . . . . . . .23
Rule 144A Securities. . . . . . . . . . . . . . . . . . . . . .24
Rights Offerings and Purchase Warrants . . . . . . . . . . . . . . .24
Borrowing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
U.S. Core Equity Fund only. . . . . . . . . . . . . . . . . . . . . . . .25
Short Selling . . . . . . . . . . . . . . . . . . . . . . . . . . .25
Short Sales Against the Box . . . . . . . . . . . . . . . . . . . .25

<PAGE>

Lending of Portfolio Securities. . . . . . . . . . . . . . . . . . .27
Aggressive Equity Fund and Global Independence Fund Only. . . . . . . . .27
Non-Diversified Status . . . . . . . . . . . . . . . . . . . . . . .27
Below Investment Grade Securities. . . . . . . . . . . . . . . . . .28
Other Investment Limitations. . . . . . . . . . . . . . . . . . . . . . .29
Portfolio Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . .31
Portfolio Transactions. . . . . . . . . . . . . . . . . . . . . . . . . .32
Portfolio Turnover. . . . . . . . . . . . . . . . . . . . . . . . . . . .34
Management of the Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . .35
Officers and Trustees . . . . . . . . . . . . . . . . . . . . . . . . . .35
Control Persons and Principal Stockholders. . . . . . . . . . . . . . . .38
Investment Adviser and Administrator. . . . . . . . . . . . . . . . . . .38
Management Fees. . . . . . . . . . . . . . . . . . . . . . . . . . .
Choice of Performance Benchmark. . . . . . . . . . . . . . . . . . .39
Distribution and Shareholder Servicing. . . . . . . . . . . . . . . . . .42
Investor Shares. . . . . . . . . . . . . . . . . . . . . . . . . . .42
Institutional Shares . . . . . . . . . . . . . . . . . . . . . . . .43
General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43
Custodian and Transfer Agent. . . . . . . . . . . . . . . . . . . . . . .43
Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
Additional Purchase and Redemption Information . . . . . . . . . . . . . . . .44
Automatic Cash Withdrawal Plan . . . . . . . . . . . . . . . . . . .45
Exchange Privilege . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45
Additional Information Concerning Taxes. . . . . . . . . . . . . . . . . . . .46
The Funds and Their Investments . . . . . . . . . . . . . . . . . . . . .46
Passive Foreign Investment Companies . . . . . . . . . . . . . . . .48
Taxation of United States Shareholders. . . . . . . . . . . . . . . . . .50
Dividends and Distributions. . . . . . . . . . . . . . . . . . . . .50
Sales of Shares. . . . . . . . . . . . . . . . . . . . . . . . . . .51
Backup Withholding . . . . . . . . . . . . . . . . . . . . . . . . .51
Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51
Other Taxation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51
Determination of Performance . . . . . . . . . . . . . . . . . . . . . . . . .52
Independent Accountants and Counsel. . . . . . . . . . . . . . . . . . . . . .53
Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53
Appendix -- Description of Ratings . . . . . . . . . . . . . . . . . . . . . A-1

<PAGE>

ORGANIZATION OF THE FUNDS

The Trust is an open-end management investment company that was
organized on October 13, 1998 under the laws of the State of Delaware and is a
business entity commonly known as "Delaware business trust." The Trust
currently offers three separately managed series each comprised of both Investor
and Institutional shares: U.S. Core Equity Fund, Aggressive Equity Fund and
Global Independence Fund. Unless otherwise indicated, references to a "Fund"
apply to all classes of shares of that Fund as a group.

INVESTMENT OBJECTIVES AND POLICIES

The following information supplements the discussion of each Fund's
investment objectives and policies in the Prospectus. There are no assurances
that a Fund will achieve its investment objectives.

The U.S. Core Equity Fund is a diversified portfolio that seeks a high
total return greater than that of the S&P 500 Index by investing primarily in
common stocks of U.S. companies.

The Aggressive Equity Fund is a non-diversified portfolio that seeks a
high total return greater than that of the S&P 500 Index by investing primarily
in equity and equity related securities and certain derivative instruments.

The Global Independence Fund is a non-diversified portfolio that seeks
a high total return greater than that of the 90-day U.S. Treasury bill rate by
investing primarily in the global equity, global fixed income and currency
markets.

CDC Investment Management Corporation ("CDC Investments" or the
"Adviser") serves as the investment adviser to each Fund. Both the Aggressive
Equity Fund and the Global Independence Fund apply CDC Investments' Global
Dynamic Asset Allocation Strategy ("GDAA Strategy"), which focuses on building a
risk-return balanced portfolio which seeks to control the effect of shifts in
market volatility through the use of certain investment strategies. The GDAA
Strategy seeks to exploit patterns in the relationships of fundamental economic
and financial variables to the underlying equity, bond and currency markets and
uses a mix of fundamental judgment and sophisticated quantitative tools to
achieve that objective.

Options, Swaps, Futures and Currency Exchange Transactions
- ----------------------------------------------------------

At the discretion of CDC Investments, each Fund may engage in a number
of strategies involving options, futures, forward currency contracts and
swaps. These instruments, commonly referred to as "derivatives," may be used
(i) for the purpose of hedging against a decline in value of a Fund's current or
anticipated portfolio holdings, (ii) as a substitute for purchasing or selling
portfolio securities or (iii) in an attempt to generate income to offset
expenses or increase return. Transactions that are not considered hedging
should be considered speculative and may serve to increase a Fund's investment
risk. Transaction costs and any premiums associated with these strategies, and
any losses incurred,

<PAGE>

will affect a Fund's net asset value and performance. Therefore, an investment
in a Fund may involve a greater risk than an investment in other mutual funds
that do not use these strategies. The Funds' use of these strategies may be
limited by position and exercise limits established by securities and
commodities exchanges and other applicable regulatory authorities.

To the extent a Fund engages in the strategies described below, a Fund
may experience losses greater than if these strategies had not been utilized.
In addition to the risks described below, these instruments may be illiquid
and/or subject to trading limits, and a Fund may be unable to close out
positions without incurring substantial losses, if at all. A Fund is also
subject to the risk of a default by a counterparty to an off-exchange
transaction.

Securities Options. Each Fund may write covered call options on stock
and debt securities and may purchase U.S. exchanged-traded and OTC put and
call options.

A Fund realizes fees (referred to as "premiums") for granting the
rights evidenced by the options it has written. A put option embodies the right
of its purchaser to compel the writer of the option to purchase from the option
holder an underlying security at a specified price for a specified time period
or at a specified time. In contrast, a call option embodies the right of its
purchaser to compel the writer of the option to sell to the option holder an
underlying security at a specified price for a specified time period or at a
specified time.

The principal reason for writing covered options on a security is to
attempt to realize, through the receipt of premiums, a greater return than would
be realized on the securities alone. In return for a premium, a Fund that
writes a covered call option forfeits the right to any appreciation in the value
of the underlying security above the strike price for the life of the option (or
until a closing purchase transaction can be effected). Nevertheless, a Fund
that writes a call option retains the risk of a decline in the price of the
underlying security. The size of the premiums that a Fund may receive may be
adversely affected as new or existing institutions, including other investment
companies, engage in or increase their option-writing activities.

In the case of options written by a Fund that are deemed covered by
virtue of a Fund holding convertible or exchangeable preferred stock or debt
securities, the time required to convert or exchange and obtain physical
delivery of the underlying common stock with respect to which a Fund has written
options may exceed the time within which a Fund must make delivery in accordance
with an exercise notice. In these instances, a Fund may purchase or temporarily
borrow the underlying securities for purposes of physical delivery. By so
doing, a Fund will not bear any market risk, since a Fund will have the absolute
right to receive from the issuer of the underlying security an equal number of
shares to replace the borrowed securities, but a Fund may incur additional
transaction costs or interest expenses in connection with any such purchase or
borrowing.

The potential loss associated with purchasing an option is limited to
the premium paid, and the premium would partially offset any gains achieved by
its use.

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However, for an option writer the exposure to adverse price movements in the
underlying security or index is potentially unlimited during the exercise
period. Writing securities options may result in substantial losses to a Fund,
force the sale of portfolio securities at inopportune times or at less
advantageous prices, limit the amount of appreciation a Fund could realize on
its investments or require a Fund to hold securities it would otherwise sell.

Additional risks exist with respect to certain securities for which a
Fund may write covered call options. For example, if a Fund writes covered call
options on mortgage-backed securities, the mortgage-backed securities that it
holds as cover may, because of scheduled amortization or unscheduled
prepayments, cease to be sufficient cover. If this occurs, a Fund will
compensate for the decline in the value of the cover by purchasing an
appropriate additional amount of mortgage-backed securities.

Options written by a Fund will normally have expiration dates between
one and nine months from the date written. The exercise price of the options
may be below, equal to or above the market values of the underlying securities
at the times the options are written. In the case of call options, these
exercise prices are referred to as "in-the-money," "at-the-money" and
"out-of-the-money," respectively. Each Fund may write (i) in-the-money call
options when CDC Investments expects that the price of the underlying security
will remain flat or decline moderately during the option period,
(ii) at-the-money call options when CDC Investments expects that the price of
the underlying security will remain flat or advance moderately during the option
period and (iii) out-of-the-money call options when CDC Investments expects that
the premiums received from writing the call option plus the appreciation in
market price of the underlying security up to the exercise price will be greater
than the appreciation in the price of the underlying security alone. In any of
the preceding situations, if the market price of the underlying security
declines and the security is sold at this lower price, the amount of any
realized loss will be offset wholly or in part by the premium received. To
secure its obligation to deliver the underlying security when it writes a call
option, each Fund will be required to deposit in escrow the underlying security
or other assets in accordance with the rules of the Options Clearing Corporation
(the "Clearing Corporation") and of the securities exchange on which the option
is written.

Prior to their expirations, put and call options may be sold in
closing sale or purchase transactions (sales or purchases by a Fund prior to the
exercise of options that it has purchased or written, respectively, of options
of the same series) in which a Fund may realize a profit or loss from the sale.
An option position may be closed out only where there exists a secondary market
for an option of the same series on a recognized securities exchange or in the
over-the-counter market. When a Fund has purchased an option and engages in a
closing sale transaction, whether a Fund realizes a profit or loss will depend
upon whether the amount received in the closing sale transaction is more or less
than the premium a Fund initially paid for the original option plus the related
transaction costs. Similarly, in cases where a Fund has written an option, it
will realize a profit if the cost of the closing purchase transaction is less
than the premium received upon writing the original option and will incur a loss
if the cost of the closing purchase transaction exceeds the premium received
upon writing the original option. Each Fund may engage in a closing purchase
transaction to realize a profit, to prevent

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<PAGE>
an underlying security with respect to which it has written an option from being
called or put or, in the case of a call option, to unfreeze an underlying
security (thereby permitting its sale or the writing of a new option on the
security prior to the outstanding option's expiration). The obligation of a
Fund under an option it has written would be terminated by a closing purchase
transaction, but a Fund would not be deemed to own an option as a result of the
transaction. So long as the obligation of a Fund as the writer of an option
continues, a Fund may be assigned an exercise notice by the broker-dealer
through which the option was sold, requiring a Fund to deliver the underlying
security against payment of the exercise price. This obligation terminates when
the option expires or a Fund effects a closing purchse transaction. A Fund can
no longer effect a closing purchase transaction with respect to an option once
it has been assigned an exercise notice.

There is no assurance that sufficient trading interest will exist to
create a liquid secondary market on a securities exchange for any particular
option or at any particular time, and for some options no such secondary market
may exist. A liquid secondary market for an option may cease to exist for a
variety of reasons. In the past, for example, higher than anticipated trading
activity or order flow or other unforeseen events have at times rendered certain
of the facilities of the Clearing Corporation and various securities exchanges
inadequate and resulted in the institution of special procedures, such as
trading rotations, restrictions on certain types of orders or trading halts or
suspensions in one or more options. There can be no assurance that similar
events, or events that may otherwise interfere with the timely execution of
customers' orders, will not recur. In such event, it might not be possible to
effect closing transactions in particular options. Moreover, each Fund's
ability to terminate options positions established in the over-the-counter
market may be more limited than for exchange-traded options and may also involve
the risk that securities dealers participating in over-the-counter transactions
would fail to meet their obligations to a Fund. Each Fund, however, intends to
purchase over-the-counter options only from dealers whose debt securities, as
determined by CDC Investments, are considered to be investment grade. If, as a
covered call option writer, a Fund is unable to effect a closing purchase
transaction in a secondary market, it will not be able to sell the underlying
security until the option expires or it delivers the underlying security upon
exercise. In either case, a Fund would continue to have market risk on the
security and could face higher transaction costs, including brokerage
commissions.

Securities exchanges generally have established limitations governing
the maximum number of calls and puts for each class which may be held or
written, or exercised within certain time periods by an investor or group of
investors acting in concert (regardless of whether the options are written on
the same or different securities exchanges or are held, written or exercised in
one or more accounts or through one or more brokers). It is possible that each
Fund and other clients of CDC Investments and certain of its affiliates may be
considered to be such a group. A securities exchange may order the liquidation
of positions found to be in violation of these limits and it may impose certain
other sanctions. These limits may restrict the number of options a Fund will be
able to purchase on a particular security.

Stock Index Options. Each Fund may purchase and write exchange-listed
and OTC put and call options on stock indexes. A stock index measures the
movement of a certain

4
<PAGE>

group of stocks by assigning relative values to the common stocks included in
the index, fluctuating with changes in the market values of the stocks included
in the index. Some stock index options are based on a broad market index, such
as the NYSE Composite Index, or a narrower market index such as the Standard &
Poor's 100 Index. Indexes may also be based on a particular industry or market
segment.

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

OTC Options. Each Fund may purchase OTC or dealer options or sell
covered OTC options. Unlike exchange-listed options where an intermediary or
clearing corporation, such as the Clearing Corporation, assures that all
transactions in such options are properly executed, the responsibility for
performing all transactions with respect to OTC options rests solely with the
writer and the holder of those options. A listed call option writer, for
example, is obligated to deliver the underlying stock to the clearing
organization if the option is exercised, and the clearing organization is then
obligated to pay the writer the exercise price of the option. If a Fund were to
purchase a dealer option, however, it would rely on the dealer from whom it
purchased the option to perform if the option were exercised. If the dealer
fails to honor the exercise of the option by a Fund, a Fund would lose the
premium it paid for the option and the expected benefit of the transaction.

Exchange-traded options generally have a continuous liquid market
while OTC or dealer options do not. Consequently, a Fund will generally be
able to realize the value of a dealer option it has purchased only by
exercising it or reselling it to the dealer who issued it. Similarly, when a
Fund writes a dealer option, it generally will be able to close out the
option prior to its expiration only by entering into a closing purchase
transaction with the dealer to which a Fund originally wrote the option.
Although each Fund will seek to enter into dealer options only with dealers
who will agree to and that are expected to be capable of entering into
closing transactions with a Fund, there can be no assurance that a Fund will
be able to liquidate a dealer option at a favorable price at any time prior
to expiration. The inability to enter into a closing transaction may result
in a material loss to the Fund. Until a Fund, as a covered OTC call option
writer, is able to effect a closing purchase transaction, it will not be able
to liquidate securities (or other assets) used to cover the written option
until the option expires or is exercised. This requirement may impair a
Fund's ability to sell portfolio securities or, with

5
<PAGE>

respect to currency options, currencies at a time when such sale might be
advantageous.

Futures Activities. Each Fund may enter into foreign currency,
interest rate and stock index futures contracts and purchase and write (sell)
related options traded on exchanges designated by the Commodity Futures
Trading Commission (the "CFTC") or consistent with CFTC regulations on
foreign exchanges. The Aggressive Equity and Global Independence Funds may
also enter into futures contracts on precious metals and purchase and sell
related options on precious metals. These futures contracts are standardized
contracts for the future delivery of a foreign currency, precious metal, an
interest rate sensitive security or, in the case of index futures contracts
or certain other futures contracts, are settled in cash with reference to a
specified multiplier times the change in the specified index. An option on a
futures contract gives the purchaser the right, in return for the premium
paid, to assume a position in a futures contract. These transactions may be
entered into for "bona fide hedging" purposes as defined in CFTC regulations
and other permissible purposes including (i) for the purpose of hedging
against a decline in value of a Fund's current or anticipated portfolio
holdings, (ii) as a substitute for purchasing or selling portfolio securities
or (iii) in an attempt to generate income to offset expenses or increase
return.

Futures Contracts. A foreign currency futures contract provides
for the future sale by one party and the purchase by the other party of a
certain amount of a specified non-U.S. currency at a specified price, date,
time and place. A precious metals futures contract provides for the future
sale by one party and the purchase by the other party of a certain amount of
a precious metal at a specified price, date, time and place. An interest
rate futures contract provides for the future sale by one party and the
purchase by the other party of a certain amount of a specific interest rate
sensitive financial instrument (debt security) at a specified price, date,
time and place. Stock indexes are capitalization weighted indexes which
reflect the market value of the stock represented in the indexes. A stock
index futures contract is an agreement to be settled by delivery of an amount
of cash equal to a specified multiplier times the difference between the
value of the index at the close of the last trading day on the contract and
the price at which the contract is made.

No consideration is paid or received by a Fund upon entering into a
futures contract. Instead, a Fund is required to deposit in a segregated
account with its custodian an amount of cash or liquid securities acceptable to
the broker, equal to approximately 1% to 10% of the contract amount (this amount
is subject to change by the exchange on which the

6
<PAGE>

contract is traded, and brokers may charge a higher amount). This amount is
known as "initial margin" and is in the nature of a performance bond or good
faith deposit on the contract which is returned to a Fund upon termination of
the futures contract, assuming all contractual obligations have been satisfied.
The broker will have access to amounts in the margin account if a Fund fails to
meet its contractual obligations. Subsequent payments, known as "variation
margin," to and from the broker, will be made daily as the currency, financial
instrument or stock index underlying the futures contract fluctuates, making the
long and short positions in the futures contract more or less valuable, a
process known as "marking-to-market." A Fund will also incur brokerage costs in
connection with entering into futures transactions.

At any time prior to the expiration of a futures contract, a Fund may
elect to close the position by taking an opposite position, which will operate
to terminate a Fund's existing position in the contract. Positions in futures
contracts and options on futures contracts (described below) may be closed out
only on the exchange on which they were entered into (or through a linked
exchange). No secondary market for such contracts exists. Although each Fund
intends to enter into futures contracts only if there is an active market for
such contracts, there is no assurance that an active market will exist at any
particular time. Most futures exchanges limit the amount of fluctuation
permitted in futures contract prices during a single trading day. Once the
daily limit has been reached in a particular contract, no trades may be made
that day at a price beyond that limit or trading may be suspended for specified
periods during the day. It is possible that futures contract prices could move
to the daily limit for several consecutive trading days with little or no
trading, thereby preventing prompt liquidation of futures positions at an
advantageous price and subjecting a Fund to substantial losses. In such event,
and in the event of adverse price movements, a Fund would be required to make
daily cash payments of variation margin. In such situations, if a Fund had
insufficient cash, it might have to sell securities to meet daily variation
margin requirements at a time when it would be disadvantageous to do so. In
addition, if the transaction is entered into for hedging purposes, in such
circumstances a Fund may realize a loss on a futures contract or option that is
not offset by an increase in the value of the hedged position. Losses incurred
in futures transactions and the costs of these transactions will affect a Fund's
performance.

Options on Futures Contracts. Each Fund may purchase and write put
and call options on foreign currency, interest rate and stock index futures
contracts and may enter into closing transactions with respect to such options
to terminate existing positions. There is no guarantee that such closing
transactions can be effected; the ability to establish and close out positions
on such options will be subject to the existence of a liquid market.

An option on a currency, interest rate or stock index futures
contract, as contrasted with the direct investment in such a contract, gives the
purchaser the right, in return for the premium paid, to assume a position in a
futures contract at a specified exercise price at any time prior to the
expiration date of the option. The writer of the option is required upon
exercise to assume an offsetting futures position (a short position if the
option is a call and a long position if the option is a put). Upon exercise of
an option, the delivery of the futures position by the writer of the option to
the holder of the option will be accompanied by delivery of the accumulated
balance in the writer's futures margin account, which represents the

7
<PAGE>

amount by which the market price of the futures contract exceeds, in the case of
a call, or is less than, in the case of a put, the exercise price of the option
on the futures contract. The potential loss related to the purchase of an
option on futures contracts is limited to the premium paid for the option (plus
transaction costs). Because the value of the option is fixed at the point of
sale, there are no daily cash payments by the purchaser to reflect changes in
the value of the underlying contract; however, the value of the option does
change daily and that change would be reflected in the net asset value of each
Fund. The CFTC has recently adopted rules that will permit exchanges to use
futures-style margining with respect to options on futures upon approval by the
CFTC.

Currency Exchange Transactions. The value in U.S. dollars of the
assets of a Fund that are invested in foreign securities may be affected
favorably or unfavorably by a variety of factors not applicable to
investment in U.S. securities, and a Fund may incur costs in connection with
conversion between various currencies. Currency exchange transactions may be
from any non-U.S. currency into U.S. dollars or into other appropriate
currencies. Each Fund will conduct its currency exchange transactions (i) on
a spot (I.E., cash) basis at the rate prevailing in the currency exchange
market, (ii) through entering into futures contracts or options on such
contracts (as described above), (iii) through entering into forward contracts
to purchase or sell currency or (iv) by purchasing exchange-traded currency
options. Risk associated with currency forward contracts and purchasing
currency options are similar to those described herein for futures contracts
and securities and stock index options. In addition, the use of currency
transactions could result in losses from the imposition of foreign exchange
controls, suspension of settlement or other governmental actions or
unexpected events.

Forward Currency Contracts. A forward currency contract involves an
obligation to purchase or sell a specific currency at a future date, which may
be any fixed number of days from the date of the contract as agreed upon by the
parties, at a price set at the time of the contract. These contracts are
entered into in the interbank market conducted directly between currency traders
(usually large commercial banks and brokers) and their customers. Forward
currency contracts are similar to currency futures contracts, except that
futures contracts are traded on commodities exchanges and are standardized as to
contract size and delivery date.

At or before the maturity of a forward contract, a Fund may either
sell a portfolio security and make delivery of the currency, or retain the
security and fully or partially offset its contractual obligation to deliver the
currency by negotiating with its trading partner to purchase a second,
offsetting contract. If a Fund retains the portfolio security and engages in an
offsetting transaction, a Fund, at the time of execution of the offsetting
transaction, will incur a gain or a loss to the extent that movement has
occurred in forward contract prices.

The OTC market in forward foreign currency exchange contracts offers
less protection against defaults by the other party to such instruments than is
available for currency instruments traded on an exchange. Such contracts are
subject to the risk that the counterparty to the contract will default on its
obligations. Since these contracts are not guaranteed by an

8
<PAGE>

exchange or clearinghouse, a default on the contract would deprive a Fund of
unrealized profits, transaction costs or the benefits of a currency hedge or
force a Fund to cover its purchase or sale commitments, if any, at the current
market price. Currency exchange rates may fluctuate significantly over short
periods of time. They generally are determined by the forces of supply and
demand in the foreign exchange markets and the relative merits of investments in
different countries, actual or perceived changes in interest rates and other
complex factors as seen from an international perspective. Currency exchange
rates also can be affected unpredictably by intervention by U.S. or foreign
governments or central banks, or the failure to intervene, or by currency
controls or political developments in the U.S. or abroad.

Currency Options. Each Fund may purchase exchange-traded put and call
options on foreign currencies. Put options convey the right to sell the
underlying currency at a price which is anticipated to be higher than the spot
price of the currency at the time the option is exercised. Call options convey
the right to buy the underlying currency at a price which is expected to be
lower than the spot price of the currency at the time the option is exercised.

Hedging (with respect to the U.S. Core Equity Fund only). In addition
to entering into options, futures and currency exchange transactions for other
purposes, including generating current income to offset expenses or increase
return, the Fund may enter into these transactions as hedges to reduce
investment risk, generally by making an investment expected to move in the
opposite direction of a portfolio position. A hedge is designed to offset a
loss in a portfolio position with a gain in the hedged position or to mitigate
against non-diversification risks; at the same time, however, a properly
correlated hedge will result in a gain in the portfolio position being offset by
a loss in the hedged position. As a result, the use of options, futures,
contracts and currency exchange transactions for hedging purposes could limit
any potential gain from an increase in the value of the position hedged. In
addition, the movement in the portfolio position hedged may not be of the same
magnitude as movement in the hedge. With respect to futures contracts, since
the value of portfolio securities will far exceed the value of short futures
contracts entered into by the Fund, an increase in the value of the futures
contracts could only mitigate, but not totally offset, the decline in the value
of the Fund's assets.

In hedging transactions based on an index, whether the Fund will
realize a gain or loss from the purchase or writing of options on an index
depends upon movements in the level of stock prices in the stock market
generally or, in the case of certain indexes, in an industry or market segment,
rather than movements in the price of a particular stock. The risk of imperfect
correlation increases as the composition of the Fund's portfolio varies from the
composition of the index. In an effort to compensate for imperfect correlation
of relative movements in the hedged position and the hedge, the Fund's hedge
positions may be in a greater or lesser dollar amount than the dollar amount of
the hedged position. Such "over hedging" or "under hedging" may adversely
affect the Fund's net investment results if market movements are not as
anticipated when the hedge is established. Stock index futures transactions may
be subject to additional correlation risks. First, all participants in the
futures market are subject to margin deposit and maintenance requirements.
Rather than meeting

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<PAGE>

additional margin deposit requirements, investors may close futures contracts
through offsetting transactions which would distort the normal relationship
between the stock index and futures markets. Second, from the point of view
of speculators, the deposit requirements in the futures market are less onerous
than margin requirements in the securities market. Therefore, increased
participation by speculators in the futures market also may cause temporary
price distortions. Because of the possibility of price distortions in the
futures market and the imperfect correlation between movements in the stock
index and movements in the price of stock index futures, a correct forecast of
general market trends by CDC Investments still may not result in a successful
hedging transaction.

The Fund will engage in hedging transactions only when deemed
advisable by CDC Investments, and successful use by the Fund of hedging
transactions will be subject to CDC Investments' ability to predict trends in
currency, interest rate or securities markets, as the case may be, and to
correctly predict movements in the directions of the hedge and the hedged
position and the correlation between them, which predictions could prove to be
inaccurate. This requires different skills and techniques than predicting
changes in the price of individual securities, and there can be no assurance
that the use of these strategies will be successful. Even a well-conceived
hedge may be unsuccessful to some degree because of unexpected market behavior
or trends. Losses incurred in hedging transactions and the costs of these
transactions will affect the Fund's performance.

Swaps. Each Fund may enter into swaps relating to indexes, currencies
and equity interests of issuers without limit. A swap transaction is an
agreement between a Fund and a counterparty to act in accordance with the terms
of the swap contract. Index swaps involve the exchange by a Fund with another
party of the respective amounts payable with respect to a notional principal
amount related to one or more indexes. Currency swaps involve the exchange of
cash flows on a notional amount of two or more currencies based on their
relative future values. An equity swap is an agreement to exchange streams of
payments computed by reference to a notional amount based on the performance of
a basket of stocks or a single stock. Each Fund may enter into these
transactions to preserve a return or spread on a particular investment or
portion of its assets, to protect against currency fluctuations, as a duration
management technique or to protect against any increase in the price of
securities a Fund anticipates purchasing at a later date. Each Fund may also
use these transactions for speculative purposes, such as to obtain the price
performance of a security without actually purchasing the security in
circumstances, for example, the subject security is illiquid, is unavailable for
direct investment or available only on less attractive terms. Swaps have risks
associated with them including possible default by the counterparty to the
transaction, illiquidity and, where swaps are used as hedges, the risk that the
use of a swap could result in losses greater than if the swap had not been
employed. The Funds may only enter into swaps with counterparties that are
"eligible swap participants" as defined in CFTC Regulation Section 35.1 (b)(2).

Each Fund will usually enter into swaps on a net basis (I.E. the two
payment streams are netted out in a cash settlement on the payment date or dates
specified in the agreement, with a Fund receiving or paying, as the case may be,
only the net amount of the

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<PAGE>

two payments). Swaps do not involve the delivery of securities, other
underlying assets or principal. Accordingly, the risk of loss with respect to
swaps is limited to the net amount of payments that a Fund is contractually
obligated to make. If the counterparty to a swap defaults, a Fund's risk of
loss consists of the net amount of payments that a Fund is contractually
entitled to receive. Where swaps are entered into for good faith hedging
purposes, CDC Investments believes such obligations do not constitute senior
securities under the 1940 Act and, accordingly, will not treat them as being
subject to a Fund's borrowing restrictions. Where swaps are entered into for
other than hedging purposes, a Fund will segregate an amount of cash or liquid
securities having a value equal to the accrued excess of its obligations over
entitlements with respect to each swap on a daily basis.

Asset Coverage for Forward Contracts, Options, Futures and Options
on Futures. The Funds will comply with guidelines established by the U.S.
Securities and Exchange Commission (the "SEC") and other applicable
regulatory bodies with respect to coverage of forward currency contracts;
options written by the Funds on securities and indexes; and currency,
interest rate and index futures contracts and options on these futures
contracts. These guidelines may, in certain instances, require segregation
by a Fund of cash or liquid high-grade debt securities or other securities
that are acceptable as collateral to the appropriate regulatory authority.
Segregated assets cannot be sold or transferred unless equivalent assets are
substituted in their place or it is no longer necessary to separate them. As
a result, there is a possibility that segregation of a large percentage of a
Fund's assets could impede portfolio management or a Fund's ability to meet
redemption requests or other current obligations.

For example, a call option written by a Fund on securities may require
a Fund to hold the securities subject to the call (or securities convertible
into the securities without additional consideration) or to segregate assets (as
described above) sufficient to purchase and deliver the securities if the call
is exercised. A call option written by a Fund on an index may require a Fund to
own portfolio securities that correlate with the index or to segregate assets
(as described above) equal to the excess of the index value over the exercise
price on a current basis. A Fund could purchase a put option if the strike
price of that option is the same or higher than the strike price of a put option
sold by a Fund. If a Fund holds a futures or forward contract, a Fund could
purchase a put option on the same futures or forward contract with a strike
price as high or higher than the price of the contract held. A Fund may enter
into fully or partially offsetting transactions so that its net position,
coupled with any segregated assets (equal to any remaining obligation), equals
its net obligation. Asset coverage may be achieved by other means when
consistent with applicable regulatory policies.

U.S. Government Securities.
- ---------------------------

Each Fund may invest in debt obligations of varying maturities
issued or guaranteed by the U.S. government, its agencies or
instrumentalities ("U.S. Government Securities"). Direct obligations of the
U.S. Treasury include a variety of securities that differ in their interest
rates, maturities and dates of issuance. U.S. Government Securities also
include securities issued or guaranteed by the Federal Housing
Administration, Farmers Home Loan Administration, Export-Import Bank of the
U.S., Small Business Administration, Government National Mortgage Association
("GNMA"), General Services Administration, Central Bank for Cooperatives,
Federal Farm

11
<PAGE>

Credit Banks, Federal Home Loan Banks, Federal Home Loan Mortgage Corporation
("FHLMC"), Federal Intermediate Credit Banks, Federal Land Banks, Federal
National Mortgage Association ("FNMA"), Maritime Administration, Tennessee
Valley Authority, District of Columbia Armory Board and Student Loan Marketing
Association. The Funds may also invest in instruments that are supported by the
right of the issuer to borrow from the U.S. Treasury and instruments that are
supported by the credit of the instrumentality. Because the U.S. government is
not obligated by law to provide support to an instrumentality it sponsors, the
Fund will invest in obligations issued by such an instrumentality only if CDC
Investments determines that the credit risk with respect to the instrumentality
does not make its securities unsuitable for investment by a Fund.

Money Market Obligations.
- -------------------------

Each Fund is authorized to invest in short-term money market
obligations having remaining maturities of less than one year at the time of
purchase. These short-term instruments consist of U.S. Government Securities;
bank obligations (including certificates of deposit, time deposits and bankers'
acceptances of domestic or foreign banks, domestic savings and loans and similar
institutions) that are high quality investments or, if unrated, deemed by CDC
Investments to be high quality investments; commercial paper rated no lower than
A-2 by S&P or Prime-2 by Moody's or the equivalent from another major rating
service or, if unrated, of an issuer having an outstanding, unsecured debt issue
then rated within the three highest rating categories; and repurchase agreements
with respect to portfolio securities.

Bank Obligations. The Funds may purchase certificates of deposit,
time deposits, bankers' acceptances and other short-term obligations issued by
domestic banks, foreign subsidiaries or foreign branches of domestic banks,
domestic and foreign branches of foreign banks, domestic savings and loan
associations and other banking institutions. With respect to such securities
issued by foreign subsidiaries or foreign branches of domestic banks, and
domestic and foreign branches of foreign banks, the Funds may be subject to
additional investment risks, including future and political and economic
developments, the possible imposition of withholding taxes on interest income,
possible establishment of exchange controls or the adoption of other foreign
governmental restrictions which might adversely affect the payment of principal
and interest on such obligations.

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

Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven days)
at a stated interest rate.

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

<PAGE>

Commercial Paper. Commercial paper consists of short-term, unsecured
promissory notes issued to finance short-term credit needs. The commercial
paper purchased by each Fund will consist only of direct obligations which, at
the time of their purchase, are (a) rated not lower than Prime-1 by Moody's or
A-1 by S&P, (b) issued by companies having an outstanding unsecured debt issue
currently rated at least A3 by Moody's or A- by S&P, or (c) if unrated,
determined by CDC Investments to be of comparable quality to those rated
obligations which may be purchased by the Fund.

Other Short-Term Corporate Obligations. These instruments include
variable amount master demand notes, which are obligations that permit a Fund to
invest fluctuating amounts at varying rates of interest pursuant to direct
arrangements between a Fund, as lender, and the borrower. These notes permit
daily changes in the amounts borrowed. Because these obligations are direct
lending arrangements between the lender and borrower, it is not contemplated
that such instruments generally will be traded, and there generally is no
established secondary market for these obligations, although they are redeemable
at face value, plus accrued interest, at any time. Accordingly, where these
obligations are not secured by letters of credit or other credit support
arrangements, a Fund's right to redeem is dependent on the ability of the
borrower to pay principal and interest on demand. Such obligations frequently
are not rated by credit rating agencies, and a Fund may invest in them only if
at the time of an investment CDC Investments determines that such investment is
of comparable quality to those rated obligations which may be purchased by each
Fund.

If CDC Investments determines that market conditions temporarily
warrant a defensive investment policy, each Fund may invest up to 100% of its
assets in money market instruments. The yield on such securities may be lower
than the yield on lower-rated, fixed-income securities.

Additional Information on Other Investment Practices
- ----------------------------------------------------

Foreign Investments. Investors should recognize that investing in
foreign companies involves certain risks, including those discussed below, which
are not typically associated with investing in U.S. issuers. These risks
include currency exchange rates and exchange control regulations, less publicly
available information, different accounting and reporting standards, less liquid
markets, more volatile markets, higher brokerage commission and other fees,
possibility of nationalization or expropriation, confiscatory taxation,
political instability, and less protection provided by the judicial system.

Since the Funds may invest in securities denominated in currencies
other than the U.S. dollar, and since the Funds may temporarily hold funds in
bank deposits or other money market investments denominated in foreign
currencies, the Funds may be affected favorably or unfavorably by exchange
control regulations or changes in the exchange rate between such currencies and
the dollar. A change in the value of a foreign currency relative to the U.S.
dollar will result in a corresponding change in the dollar value of Fund assets
denominated in that foreign currency. Changes in foreign currency exchange
rates may also affect the value of dividends and interest earned, gains and
losses realized on the sale of

13
<PAGE>

securities and net investment income and gains, if any, to be distributed to
shareholders by the Funds. The rate of exchange between the U.S. dollar and
other currencies is determined by the forces of supply and demand in the foreign
exchange markets. Changes in the exchange rate may result over time from the
interaction of many factors directly or indirectly affecting economic and
political conditions in the U.S. and a particular foreign country, including
economic and political developments in other countries. Of particular
importance are rates of inflation, interest rate levels, the balance of payments
and the extent of government surpluses or deficits in the U.S. and the
particular foreign country, all of which are in turn sensitive to the monetary,
fiscal and trade policies pursued by the governments of the U.S. and foreign
countries important to international trade and finance. Governmental
intervention may also play a significant role. National governments rarely
voluntarily allow their currencies to float freely in response to economic
forces. Sovereign governments use a variety of techniques, such as intervention
by a country's central bank or imposition of regulatory controls or taxes, to
affect the exchange rates of their currencies. The Funds may use hedging
techniques with the objective of proteting against loss through the fluctuation
of the value of foreign currencies against the U.S. dollar, particularly the
forward market in foreign exchange, currency options and currency futures. See
"Currency Transactions" and "Futures Transactions" above.

Many of the foreign securities held by the Funds will not be
registered with, nor the issuers thereof be subject to reporting requirements
of, the SEC. Accordingly, there may be less publicly available information
about the securities and about the foreign company or government issuing them
than is available about a domestic company or government entity. Foreign
companies are generally not subject to uniform financial reporting standards,
practices and requirements comparable to those applicable to U.S. companies. In
addition, with respect to some foreign countries, there is the possibility of
expropriation or confiscatory taxation, limitations on the removal of funds or
other assets of the Funds, political or social instability, or domestic
developments which could affect U.S. investments in those countries. Moreover,
individual foreign economies may differ favorably or unfavorably from the U.S.
economy in such respects as growth of gross national product, rate of inflation,
capital reinvestment, resource self-sufficiency, and balance of payments
positions. The Funds may invest in securities of foreign governments (or
agencies or instrumentalities thereof), and many, if not all, of the foregoing
considerations apply to such investments as well.

Securities of some foreign companies are less liquid and their prices
are more volatile than securities of comparable U.S. companies. Certain foreign
countries are known to experience long delays between the trade and settlement
dates of securities purchased or sold. Due to the increased exposure of the
Funds to market and foreign exchange fluctuations brought about by such delays,
and due to the corresponding negative impact on Fund liquidity, the Funds will
avoid investing in countries which are known to experience settlement delays
which may expose the Fund to unreasonable risk of loss.

With respect to some foreign countries, there is the possibility of
expropriation, nationalization, or confiscatory taxation and limitations on the
use or removal of funds or other

14
<PAGE>

assets of a Fund, including the withholding of dividends. Political or social
instability, or domestic developments could affect U.S. investments in those and
neighboring countries.

The operating expenses of a Fund, to the extent it invests in foreign
securities, may be higher than that of an investment company investing
exclusively in U.S. securities, since the expenses of the Fund, such as the cost
of converting foreign currency into U.S. dollars, the payment of fixed brokerage
commissions on foreign exchanges, custodial costs, valuation costs and
communication costs, may be higher than those costs incurred by investment
companies not investing in foreign securities. In addition, foreign securities
may be subject to foreign government taxes that would reduce the net yield in
such securities.

Foreign Debt Securities. Each of the Funds may invest in debt
securities (other than money market obligations) and preferred stocks that are
not convertible into common stock for the purpose of seeking capital
appreciation. Each Fund's holdings of debt securities will be considered
investment grade at the time of purchase, except that the Aggressive Equity Fund
and the Global Independence Fund may purchase a certain amount of below
investment grade securities (see "Below Investment Grade Securities"). A
security will be deemed to be investment grade if it is rated within the four
highest grades by Moody's Investors Service, Inc. ("Moody's") or Standard &
Poor's Ratings Service ("S&P") or, if unrated, is determined to be of comparable
quality by CDC Investments. The returns on foreign debt securities reflect
interest rates and other market conditions prevailing in those countries and the
effect of gains and losses in the denominated currencies against the U.S.
dollar, which have had a substantial impact on investment in foreign
fixed-income securities. The relative performance of various countries'
fixed-income markets historically has reflected wide variations relating to the
unique characteristics of each country's economy. Year-to-year fluctuations in
certain markets have been significant, and negative returns have been
experienced in various markets from time to time.

The foreign government securities in which the Funds may invest
generally consist of obligations issued or backed by national, state or
provincial governments or similar political subdivisions or central banks in
foreign countries. Foreign government securities also include debt obligations
of supranational entities, which include international organizations designated
or backed by governmental entities to promote economic reconstruction or
development, international banking institutions and related government agencies.
Examples include the International Bank for Reconstruction and Development (the
"World Bank"), the European Coal and Steel Community, the Asian Development Bank
and the InterAmerican Development Bank.

Foreign government securities also include debt securities of
quasi-governmental agencies and debt securities denominated in multinational
currency units of an issuer (including supranational issuers). Debt securities
of quasi-governmental agencies are issued by entities owned by either a
national, state or equivalent government or are obligations of a political unit
that is not backed by the national government's full faith and credit and
general taxing powers. An example of a multinational currency unit is the
European Currency Unit ("ECU"). An ECU represents specified amounts of the
currencies of certain member states of the European

15
<PAGE>

Economic Community. The specific amounts of currencies comprising the ECU may
be adjusted by the Council of Ministers of the European Union to reflect changes
in relative values of the underlying currencies.

Emerging Markets. Investing in securities of issuers located in
"emerging markets" (less developed countries located outside of the U.S.)
involves not only the risks described above with respect to investing in foreign
securities, but also other risks, including exposure to economic structures that
are generally less diverse and mature than, and to political systems that can be
expected to have less stability than, those of developed countries. For
example, many investments in emerging markets experienced significant declines
in value due to political and currency volatility in emerging markets countries
during the latter part of 1997 and the first half of 1998. Other
characteristics of emerging markets that may affect investment include certain
national policies that may restrict investment by foreigners in issuers or
industries deemed sensitive to relevant national interests and the absence of
developed structures governing private and foreign investments and private
property. The typically small size of the markets for securities of issuers
located in emerging markets and the possibility of a low or nonexistent volume
of trading in those securities may also result in a lack of liquidity and in
price volatility of those securities.

Depositary Receipts. The assets of each Fund may be invested in the
securities of foreign issuers in the form of American Depositary Receipts
("ADRs") and European Depositary Receipts ("EDRs"). These securities may not
necessarily be denominated in the same currency as the securities into which
they may be converted. ADRs are receipts typically issued by a U.S. bank or
trust company which evidence ownership of underlying securities issued by a
foreign corporation. EDRs, which are sometimes referred to as Continental
Depositary Receipts ("CDRs"), are receipts issued in Europe typically by
non-U.S. banks and trust companies that evidence ownership of either foreign or
domestic securities. Generally, ADRs in registered form are designed for use in
U.S. securities markets and EDRs and CDRs in bearer form are designed for use in
European securities markets.

Fixed Income Securities. The value of the securities held by a Fund,
and thus the net asset value of the shares of a Fund, generally will vary
inversely in relation to changes in prevailing interest rates. Thus, if
interest rates have increased from the time a debt or other fixed income
security was purchased, such security, if sold, might be sold at a price less
than its cost. Conversely, if interest rates have declined from the time such a
security was purchased, such security, if sold, might be sold at a price greater
than its cost. Also, the value of such securities may be affected by changes in
real or perceived creditworthiness of the issuers. Thus, if creditworthiness is
enhanced, the price may rise. Conversely, if creditworthiness declines, the
price may decline. A Fund is not restricted to any maximum or minimum time to
maturity in purchasing portfolio securities, and the average maturity of a
Fund's assets will vary based on CDC Investments' assessment of economic and
market conditions.

Securities of Other Investment Companies. Each Fund may invest in
securities of other investment companies to the extent permitted under the
Investment Company Act of

16
<PAGE>

1940, as amended (the "1940 Act"). Presently, under the 1940 Act, each Fund may
hold securities of another investment company in amounts which (i) do not exceed
3% of the total outstanding voting stock of such company, (ii) do not exceed 5%
of the value of each Fund's total assets and (iii) when added to all other
investment company securities held by each Fund, do not exceed 10% of the value
of each Fund's total assets.

When-Issued Securities, Delayed-Delivery Transactions and Forward
Commitments. Each Fund may purchase securities on a "when-issued" basis, for
delayed delivery (I.E., payment or delivery occur beyond the normal settlement
date at a stated price and yield) or on a forward commitment basis in an amount
up to 20% of its total assets. Each Fund does not intend to engage in these
transactions for speculative purposes, but only in furtherance of its investment
objectives. These transactions occur when securities are purchased or sold by a
Fund with payment and delivery taking place in the future to secure what is
considered an advantageous yield and price to a Fund at the time of entering
into the transaction. The payment obligation and the interest rate that will be
received on when-issued securities are fixed at the time the buyer enters into
the commitment. Due to fluctuations in the value of securities purchased or
sold on a when-issued, delayed-delivery basis or forward commitment basis, the
prices obtained on such securities may be higher or lower than the prices
available in the market on the dates when the investments are actually delivered
to the buyers. When-issued securities may include securities purchased on a
"when, as and if issued" basis under which the issuance of the security depends
on the occurrence of a subsequent event, such as approval of a merger, corporate
reorganization or debt restructuring.

When a Fund agrees to purchase when-issued, delayed-delivery
securities or securities on a forward commitment basis, its custodian will set
aside cash or liquid securities equal to the amount of the commitment in a
segregated account. Normally, the custodian will set aside portfolio securities
to satisfy a purchase commitment, and in such a case a Fund may be required
subsequently to place additional assets in the segregated account in order to
ensure that the value of the account remains equal to the amount of a Fund's
commitment. The assets contained in the segregated account will be
marked-to-market daily. It may be expected that a Fund's net assets will
fluctuate to a greater degree when it sets aside portfolio securities to cover
such purchase commitments than when it sets aside cash. When a Fund engages in
when-issued, delayed-delivery or forward commitment transactions, it relies on
the other party to consummate the trade. Failure of the seller to do so may
result in a Fund's incurring a loss or missing an opportunity to obtain a price
considered to be advantageous.

Repurchase Agreements. Each Fund may agree to purchase securities
from a bank or recognized securities dealer and simultaneously commit to resell
the securities to the bank or dealer at an agreed-upon date and price reflecting
a market rate of interest unrelated to the coupon rate or maturity of the
purchased securities ("repurchase agreements"). Such Fund would maintain
custody of the underlying securities prior to their repurchase; thus, the
obligation of the bank or dealer to pay the repurchase price on the date agreed
to would be, in effect, secured by such securities. If the value of such
securities were less than the repurchase price, plus interest, the other party
to the agreement would be required to provide additional collateral so that at
all times the collateral is at least 102% of the repurchase price plus accrued

17
<PAGE>

interest. Default by or bankruptcy of a seller would expose a Fund to possible
loss because of adverse market action, expenses and/or delays in connection with
the disposition of the underlying obligations. The financial institutions with
which a Fund may enter into repurchase agreements will be banks and non-bank
dealers of U.S. Government securities that are listed on the Federal Reserve
Bank of New York's list of reporting dealers, if such banks and non-bank dealers
are deemed creditworthy by CDC Investments. CDC Investments will continue to
monitor creditworthiness of the seller under a repurchase agreement, and will
require the seller to maintain during the term of the agreement the value of the
securities subject to the agreement to equal at least 102% of the repurchase
price (including accrued interest). In addition, CDC Investments will require
that the value of this collateral, after transaction costs (including loss of
interest) reasonably expected to be incurred on a default, be equal to 102% or
greater than the repurchase price (including accrued premium) provided in the
repurchase agreement or the daily amortization of the difference between the
purchase price and the repurchase price specified in the repurchase agreement.
CDC Investments will mark-to-market daily the value of the securities. There
are no percentage limits on a Fund's ability to enter into repurchase
agreements. Repurchase agreements are considered to be loans by the Fund under
the 1940 Act.

Reverse Repurchase Agreements and Dollar Rolls. Each Fund may enter
into reverse repurchase agreements with the same parties with whom it may enter
into repurchase agreements. Reverse repurchase agreements involve the sale of
securities held by a Fund pursuant to its agreement to repurchase them at a
mutually agreed upon date, price and rate of interest. At the time a Fund
enters into a reverse repurchase agreement, it will establish and maintain a
segregated account with an approved custodian containing cash or liquid
securities having a value not less than the repurchase price (including accrued
interest). The assets contained in the segregated account will be
marked-to-market daily and additional assets will be placed in such account on
any day in which the assets fall below the repurchase price (plus accrued
interest). A Fund's liquidity and ability to manage its assets might be
affected when it sets aside cash or portfolio securities to cover such
commitments. Reverse repurchase agreements involve the risk that the market
value of the securities retained in lieu of sale may decline below the price of
the securities a Fund has sold but is obligated to repurchase. In the event the
buyer of securities under a reverse repurchase agreement files for bankruptcy or
becomes insolvent, such buyer or its trustee or receiver may receive an
extension of time to determine whether to enforce a Fund's obligation to
repurchase the securities, and a Fund's use of the proceeds of the reverse
repurchase agreement may effectively be restricted pending such decision.

Each Fund also may enter into "dollar rolls," in which a Fund sells
fixed-income securities for delivery in the current month and simultaneously
contracts to repurchase similar but not identical (same type, coupon and
maturity) securities on a specified future date. During the roll period, a Fund
would forego principal and interest paid on such securities. A Fund would be
compensated by the difference between the current sales price and the forward
price for the future purchase, as well as by the interest earned on the cash
proceeds of the initial sale. At the time a Fund enters into a dollar roll
transaction, it will place in a segregated account maintained with an approved
custodian, cash or liquid securities having a

18
<PAGE>

value not less than the repurchase price (including accrued interest) and will
subsequently monitor the account to ensure that its value is maintained.
Reverse repurchase agreements and dollar rolls that are accounted for as
financings are considered to be borrowings under the 1940 Act.

Loan Participations and Assignments. Each Fund may invest in fixed
and floating rate loans ("Loans") arranged through private negotiations between
a foreign government and one or more financial institutions ("Lenders"). The
majority of the Funds' investments in Loans are expected to be in the form of
participations in Loans ("Participations") and assignments of portions of Loans
from third parties ("Assignments"). Participations typically will result in a
Fund having a contractual relationship only with the Lender, not with the
borrower. A participating Fund will have the right to receive payments of
principal, interest and any fees to which it is entitled only from the Lender
selling the Participation and only upon receipt by the Lender of the payments
from the borrower. In connection with purchasing Participations, a Fund
generally will have no right to enforce compliance by the borrower with the
terms of the loan agreement relating to the Loan ("Loan Agreement"), nor any
rights of set-off against the borrower, and a Fund may not directly benefit from
any collateral supporting the Loan in which it has purchased the Participation.
As a result, participating Funds will assume the credit risk of both the
borrower and the Lender that is selling the Participation. In the event of the
insolvency of the Lender selling a Participation, a Fund may be treated as a
general creditor of the Lender and may not benefit from any set-off between the
Lender and the borrower. The Funds will acquire Participations only if the
Lender interpositioned between the Funds and the borrower is determined by CDC
Investments to be creditworthy.

Zero Coupon Securities. Each Fund may invest up to 20% of its total
assets in "zero coupon" U.S. Treasury, foreign government and U.S. and foreign
corporate debt securities, which are bills, notes and bonds that have been
stripped of their unmatured interest coupons and custodial receipts or
certificates of participation representing interests in such stripped debt
obligations and coupons. A zero coupon security pays no interest to its holder
prior to maturity. Accordingly, such securities usually trade at a deep
discount from their face or par value and will be subject to greater
fluctuations of market value in response to changing interest rates than debt
obligations of comparable maturities that make current distributions of interest
and may be more, speculative than such other securities. Accordingly, the
values of these securities may be highly volatile as interest rates rise or
fail. Redemption of shares of a Fund that require it to sell zero coupon
securities prior to maturity may result in capital gains or losses that are
substantial. Each Fund anticipates that it will not normally hold zero coupon
securities to maturity. Federal tax law requires that a holder of a zero coupon
security accrue a portion of the discount at which the security was purchased as
income each year, even though the holder receives no interest payment on the
security during the year. Such accrued discount will be included in determining
the amount of dividends a Fund must pay each year and, in order to generate cash
necessary to pay such dividends, a Fund may liquidate portfolio securities at a
time when it would not otherwise have done so.

19
<PAGE>

Convertible Securities. A convertible security is a bond, debenture,
note, preferred stock or other security that may be converted into or exchanged
for a prescribed amount of common stock of the same or a different issuer within
a particular period of time at a specified price or formula. A convertible
security entitles the holder to receive interest paid or accrued on debt or the
dividend paid on preferred stock until the convertible security matures or is
redeemed, converted or exchanged. Before conversion, convertible securities
have characteristics similar to nonconvertible debt securities in that they
ordinarily provide a stable stream of income with generally higher yields than
those of common stocks of the same or similar issuers. Convertible securities
rank senior to common stock in a corporation's capital structure but are usually
subordinated to comparable nonconvertible securities. While no securities
investment is completely without risk, investments in convertible securities
generally entail less risk than the corporation's common stock, although the
extent to which such risk is reduced depends in large measure upon the degree to
which the convertible security sells above its value as a fixed-income security.
Convertible securities have unique investment characteristics in that they
generally (1) have higher yields than common stocks, but lower yields than
comparable non-convertible securities, (2) are less subject to fluctuation in
value than the underlying stock since they have fixed-income characteristics and
(3) provide the potential for capital appreciation if the market price of the
underlying common stock increases. Most convertible securities currently are
issued by U.S. companies, although a substantial Eurodollar convertible
securities market has developed, and the markets for convertible securities
denominated in local currencies are increasing. Subsequent to purchase by a
Fund, convertible securities may cease to be rated or a rating may be reduced
below the minimum required for purchase by a Fund. Neither event will require
sale of such securities, although CDC Investments will consider such event in
its determination of whether a Fund should continue to hold the securities.

The value of a convertible security is a function of its "investment
value" (determined by its yield in comparison with the yields of other
securities of comparable maturity and quality that do not have a conversion
privilege) and its "conversion value" (the security's worth, at market value, if
converted into the underlying common stock). The investment value of a
convertible security is influenced by changes in interest rates, with investment
value declining as interest rates increase and increasing as interest rates
decline. The credit standing of the issuer and other factors also may have an
effect on the convertible security's investment value. The conversion value of
a convertible security is determined by the market price of the underlying
common stock. If the conversion value is low relative to the investment value,
the price of the convertible security is governed principally by its investment
value. Generally the conversion value decreases as the convertible security
approaches maturity. To the extent the market price of the underlying common
stock approaches or exceeds the conversion price, the price of the convertible
security will be increasingly influenced by its conversion value. A convertible
security generally will sell at a premium over its conversion value by the
extent to which investors place value on the right to acquire the underlying
common stock while holding a fixed-income security.

A convertible security might be subject to redemption at the option of
the issuer at a price established in the convertible security's governing
instrument. If a convertible

20
<PAGE>

security held by a Fund is called for redemption, the Fund will be required to
permit the issuer to redeem the security, convert it into the underlying common
stock or sell it to a third party. The Funds will invest in convertible
securities without regard to their credit rating.

Mortgage-Backed Securities. Each Fund may invest in mortgage-backed
securities issued by U.S. government entities, such as GNMA, FNMA or FHLMC. In
addition, a Fund may invest in mortgage-backed securities sponsored by U.S.
issuers as well as non-governmental issuers. Aggressive Equity Fund and Global
Independence Fund may also invest in mortgage-backed securities of foreign
issuers. Non-government issued mortgage-backed securities may offer higher
yields than those issued by government entities, but may be subject to greater
price fluctuations. Mortgage-backed securities represent direct or indirect
participations in, or are secured by and payable from, mortgage loans secured by
real property. The mortgages backing these securities include, among other
mortgage instruments, conventional 30-year fixed-rate mortgages, 15-year
fixed-rate mortgages, graduated payment mortgages and adjustable rate mortgages.
Although there may be government or private guarantees on the payment of
interest and principal of these securities, the guarantees do not extend to the
securities' yield or value, which are likely to vary inversely with fluctuations
in interest rates, nor do the guarantees extend to the yield or value of a
Fund's shares. These securities generally are "pass-through" instruments,
through which the holders receive a share of all interest and principal payments
from the mortgages underlying the securities, net of certain fees. Some
mortgage-backed securities, such as collateralized mortgage obligations
("CMOs"), make payments of both principal and interest at a variety of
intervals; others make semiannual interest payments at a predetermined rate and
repay principal at maturity (like a typical bond).

Yields on pass-through securities are typically quoted by investment
dealers and vendors based on the maturity of the underlying instruments and the
associated average life assumption. The average life of pass-through pools
varies with the maturities of the underlying mortgage loans. A pool's term may
be shortened by unscheduled or early payments of principal on the underlying
mortgages. The occurrence of mortgage prepayments is affected by various
factors, including the level of interest rates, general economic conditions, the
location, scheduled maturity and age of the mortgage and other social and
demographic conditions. Because prepayment rates of individual pools vary
widely, it is not possible to predict accurately the average life of a
particular pool. At present, pools, particularly those with loans with
other maturities or different characteristics, are priced on an assumption of
average life determined for each pool. In periods of falling interest rates,
the rate of prepayment tends to increase, thereby shortening the actual average
life of a pool of mortgage-backed securities. Conversely, in periods of rising
rates the rate of prepayment tends to decrease, thereby lengthening the actual
average life of the pool. However, these effects may not be present, or may
differ in degree, if the mortgage loans in the pools have adjustable interest
rates or other special payment terms, such as a prepayment charge. Actual
prepayment experience may cause the yield of mortgage-backed securities to
differ from the assumed average life yield.

21
<PAGE>

Reinvestment of prepayments may occur at higher or lower interest rates than the
original investment, thus affecting a Fund's yield.

The rate of interest on mortgage-backed securities is lower than the
interest rates paid on the mortgages included in the underlying pool due to the
annual fees paid to the servicer of the mortgage pool for passing through
monthly payments to certificate holders and to any guarantor, such as GNMA, and
due to any yield retained by the issuer. Actual yield to the holder may vary
from the coupon rate, even if adjustable, if the mortgage-backed securities are
purchased or traded in the secondary market at a premium or discount. In
addition, there is normally some delay between the time the issuer receives
mortgage payments from the servicer and the time the issuer makes the payments
on the mortgage-backed securities, and this delay reduces the effective yield to
the holder of such securities.

Asset-Backed Securities. Each Fund may also invest in asset-backed
securities, which represent participations in, or are secured by and payable
from, pools of consumer loans on assets such as motor vehicle installment sales,
installment loan contracts, leases of various types of real and personal
property and receivables from revolving credit (credit card) agreements. Such
assets are securitized through the use of trusts and special purpose
corporations. Payments or distributions of principal and interest ultimately
depend on payments in respect of the underlying loans by individuals and may be
guaranteed up to certain amounts and for a certain time period by a letter of
credit or a pool insurance policy issued by a financial institution unaffiliated
with the trust or corporation.

Asset-backed securities present certain risks that are not presented
by other securities in which a Fund may invest. Automobile receivables
generally are secured by automobiles. Most issuers of automobile receivables
permit the loan servicers to retain possession of the underlying obligations.
If the servicer were to sell these obligations to another party, there is a risk
that the purchaser would acquire an interest superior to that of the holders of
the asset-backed securities. In addition, because of the large number of
vehicles involved in a typical issuance and technical requirements under state
laws, the trustee for the holders of the automobile receivables may not have a
proper security interest in the underlying automobiles. Therefore, there is the
possibility that recoveries on repossessed collateral may not, in some cases, be
available to support payments on these securities. Credit card receivables are
generally unsecured, and the debtors are entitled to the protection of a number
of state and federal consumer credit laws, many of which give such debtors the
right to set off certain amounts owed on the credit cards, thereby reducing the
balance due. In addition, there is no assurance that the security interest
in the collateral can be realized. The remaining maturity of any asset-backed
security a Fund invests in will be 397 days or less. A Fund may purchase
asset-backed securities that are unrated.

Structured Notes. The Funds may invest in structured notes. The
distinguishing feature of a structured note is that the amount of interest
and/or principal payable on the notes is based on the performance of a benchmark
asset or market other than

22
<PAGE>

fixed-income securities or interest rates. Examples of a benchmark include
stock prices, currency exchange rates and physical commodity prices. Investing
in a structured note allows a Fund to gain exposure to the benchmark asset or
market, such as investments in certain emerging markets that restrict investment
by foreigners. The structured note fixes the maximum loss that a Fund may
experience in the event that the market does not perform as expected. The
performance tie can be a straight relationship or leveraged, although CDC
Investments generally will not use leverage in its structured note strategies.
Depending on the terms of the note, a Fund may forego all or part of the
interest and principal that would be payable on a comparable conventional note;
a Fund's loss cannot exceed this foregone interest and/or principal. An
investment in a structured note involves risks similar to those associated with
a direct investment in the benchmark asset. Structured notes will be treated as
illiquid securities for investment limitation purposes.

Non-Publicly Traded and Illiquid Securities. Each Fund may not invest
more than 15% of its net assets in non-publicly traded and illiquid securities,
including securities that are illiquid by virtue of the absence of a readily
available market, repurchase agreements which have a maturity of longer than
seven days, certain Rule 144A Securities (as described below) and time deposits
maturing in more than seven days. Securities that have legal or contractual
restrictions on resale but have a readily available market are not considered
illiquid for purposes of this limitation. Repurchase agreements subject to
demand are deemed to have a maturity equal to the notice period.

Historically, illiquid securities have included securities subject to
contractual or legal restrictions on resale because they have not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
securities which are otherwise not readily marketable and repurchase agreements
having a maturity of longer than seven days. Securities which have not been
registered under the Securities Act are referred to as private placements or
restricted securities and are purchased directly from the issuer or in the
secondary market. Mutual funds do not typically hold a significant amount of
these restricted or other illiquid securities because of the potential for
delays on resale and uncertainty in valuation. Companies whose securities are
not publicly traded may not be subject to the disclosure and other investor
protection requirements applicable to companies whose securities are publicly
traded. Limitations on resale may have an adverse effect on the marketability
of portfolio securities and a mutual fund might be unable to dispose of
restricted or other illiquid securities promptly or at reasonable prices and
might thereby experience difficulty satisfying redemptions within seven days
without borrowing. A mutual fund might also have to register such restricted
securities in order to dispose of them resulting in additional expense and
delay. Adverse market conditions could impede such a public offering of
securities.

In recent years, however, a large institutional market has developed
for certain securities that are not registered under the Securities Act
including repurchase agreements, commercial paper, foreign securities, municipal
securities and corporate bonds and notes. Institutional investors depend on an
efficient institutional market in which the unregistered security can be readily
resold or on an issuer's ability to honor a demand for repayment. The

23
<PAGE>

fact that there are contractual or legal restrictions on resale to the general
public or to certain institutions may not be indicative of the liquidity of such
investments.

Rule 144A Securities. Each Fund may purchase securities that are not
registered under the Securities Act, but that can be sold to "qualified
institutional buyers" in accordance with Rule 144A under the Securities Act
adopted by the SEC. Rule 144A allows for a broader institutional trading market
for securities otherwise subject to restriction on resale to the general public.
Rule 144A establishes a "safe harbor" from the registration requirements of the
Securities Act for resales of certain securities to qualified institutional
buyers. CDC Investments anticipates that the market for certain restricted
securities such as institutional commercial paper will expand further as a
result of this regulation and use of automated systems for the trading,
clearance and settlement of unregistered securities of domestic and foreign
issuers, such as the PORTAL System sponsored by the National Association of
Securities Dealers, Inc.

An investment in Rule 144A Securities will be considered illiquid and
therefore subject to each Fund's limit on the purchase of illiquid securities
unless the Trustees or their delegates determines that the Rule 144A Securities
are liquid. In reaching liquidity decisions, the Trustees and its delegates may
consider, INTER ALIA, the following factors: (i) the unregistered nature of the
security; (ii) the frequency of trades and quotes for the security; (iii) the
number of dealers wishing to purchase or sell the security and the number of
other potential purchasers; (iv) dealer undertakings to make a market in the
security and (v) the nature of the security and the nature of the marketplace
trades (E.G., the time needed to dispose of the security, the method of
soliciting offers and the mechanics of the transfer). This investment practice
could have the effect of increasing the level of illiquidity in the Funds to the
extent that qualified institutional buyers become uninterested for a time in
purchasing Rule 144A Securities. The Trustees of each Fund will carefully
monitor any investments by a Fund in Rule 144A Securities. The Trustees may
adopt guidelines and delegate to CDC Investments the daily function of
determining and monitoring the liquidity of Rule 144A Securities, although the
Trustees will retain ultimate responsibility for any determination regarding
liquidity.

Rule 144A Securities may involve a high degree of business and
financial risk and may result in substantial losses. These securities may be
less liquid than publicly traded securities, and a Fund may take longer to
liquidate these positions than would be the case for publicly traded securities.
Although these securities may be resold in privately negotiated transactions,
the prices realized on such sales could be less than those originally paid by a
Fund. Further, companies whose securities are not publicly traded may not be
subject to the disclosure and other investor protection requirements applicable
to companies whose securities are publicly traded. A Fund's investment in
illiquid securities is subject to the risk that should a Fund desire to sell any
of these securities when a ready buyer is not available at a price that is
deemed to be representative of their value, the value of a Fund's net assets
could be adversely affected.

Rights Offerings and Purchase Warrants. Each Fund may invest up to
10% of its net assets in rights and warrants to purchase newly created equity
securities consisting of common and preferred stock. The equity security
underlying a right or warrant is outstanding at the time the right or warrant is
issued or is issued together with the right or warrant.

Investing in rights and warrants can provide a greater potential for
profit or loss than an equivalent investment in the underlying security, and,
thus, can be a speculative investment. At the time of issue, the cost of a
warrant is substantially less than the cost of the underlying security itself,
and price movements on the underlying security are generally magnified in the
price movements of the warrant. The value of a right or warrant may decline
because of a decline in the value of the underlying security, the passage of
time, changes in interest rates or in the dividend or other policies of the
company whose equity underlies the warrant or a change in the perception as to
the future price of the underlying security, or any combination thereof. An
investor's risk increases in the event of a decline in the value of the
underlying security and can result in a complete loss of the amount invested in
a warrant. In addition, the price of a warrant tends to be more volatile than,
and may not correlate exactly to, the price of the underlying security. If the
market price of the underlying security is below the exercise price of the
warrant on its expiration date, the warrant with generally expire without value.
Rights and warrants generally pay no dividends and confer no voting or other
rights other than to purchase the underlying security.

Borrowing. Each Fund may borrow up to 33 1/3% of its total assets for
temporary or emergency purposes, including to meet portfolio redemption requests
so as to permit the orderly disposition of portfolio securities or to facilitate
settlement transactions on portfolio securities. Investments (including
roll-overs) will not be made when borrowings exceed 5% of a Fund's total assets.
Although the principal of such borrowings will be fixed, a Fund's assets may
change in value during the time the borrowing is outstanding. The Funds expect
that some of their borrowings may be made on a secured basis. In such
situations, either the custodian will segregate the pledged assets for the
benefit of the lender or arrangements will be made with a suitable subcustodian,
which may include the lender.

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<PAGE>

U.S. Core Equity Fund only
- --------------------------

Short Selling. The Fund may from time to time sell securities short.
A short sale is a transaction in which the Fund sells borrowed securities it
does not own in anticipation of a decline in the market price of the securities.
The current market value of the securities sold short (excluding short sales
"against the box") will not exceed 10% of the Fund's total assets.

To deliver the securities to the buyer, the Fund must arrange through
a broker to borrow the securities and, in so doing, the Fund becomes obligated
to replace the securities borrowed at their market price at the time of
replacement, whatever that price may be. The Fund will make a profit or incur a
loss as a result of a short sale depending on whether the price of the
securities decreases or increases between the date of the short sale and the
date on which the Fund purchases the security to replace the borrowed securities
that have been sold. The amount of any loss would be increased (and any gain
decreased) by any premium or interest the Fund is required to pay in connection
with a short sale. The Fund may have to pay a premium to borrow the securities
and must pay any dividends or interest payable on the securities until they are
replaced.

The Fund's obligation to replace the securities borrowed in connection
with a short sale will be secured by cash or liquid securities deposited as
collateral with the broker. In addition, the Fund will place in a segregated
account with its custodian or a qualified subcustodian an amount of cash or
liquid securities equal to the difference, if any, between (i) the market value
of the securities sold at the time they were sold short and (ii) any cash or
liquid securities deposited as collateral with the broker in connection with the
short sale (not including the proceeds of the short sale). Until it replaces
the borrowed securities, the Fund will maintain the segregated account daily at
a level so that (a) the amount deposited in the account plus the amount
deposited with the broker (not including the proceeds form the short sale) will
equal the current market value of the securities sold short and (b) the amount
deposited in the account plus the amount deposited with the broker (not
including the proceeds from the short sale) will not be less than the market
value of the securities at the time they were sold short.

Short Sales Against the Box. The Fund may enter into a short sale of
securities such that when the short position is open a fund owns an equal amount
of the securities sold short or owns preferred stocks or debt securities,
convertible or exchangeable without payment of further consideration, into an
equal number of securities sold short. This kind of short sale, which is
referred to as one "against the box," may be entered into by the Fund to, for
example, lock in a sale price for the security a Fund does not wish to sell
immediately. The Fund will deposit, in a segregated account with its custodian
or a qualified subcustodian, the securities sold short or convertible or
exchangeable preferred stocks or debt securities in connection with short sales
against the box.

The Fund may make a short sale as a hedge, when it believes that
the price of a security may decline in the value of a security owned by the
Fund (or a security convertible or exchangeable for such security). In such
case, any future losses in the Fund's

25
<PAGE>

long position should be offset by a gain in the short position and, conversely,
any gain in the short position. The extent to which such gains or losses are
reduced will depend upon the amount of the security sold relative to the amount
the Fund owns. There will be certain additional transaction costs associated
with short sales against the box, but the Fund will endeavor to offset these
costs with the income from the investment of the cash proceeds of short sales.

If the Fund effects a short sale of securities at a time when it has
an unrealized gain in the securities, it may be required to recognize that gain
as if it had actually sold the securities (as a "constructive sale") on the date
it effects the short sale. However, such constructive sale treatment may not
apply if the Fund closes out the short sale with securities other than
appreciated securities held at the time of the short sale and if certain other
conditions are satisfied. Uncertainty regarding the tax consequences of
effecting short sales may limit the extent to which the Fund may effect short
sales.

26
<PAGE>

Lending of Portfolio Securities. The Fund may lend portfolio
securities to brokers, dealers and other financial organizations that meet
capital and other credit requirements or other criteria established by the
Fund's Trustees. These loans, if and when made, may not exceed 50% of the
Fund's total assets taken at value. The Fund will not lend portfolio
securities to affiliates of CDC Investments unless it has applied for and
received specific authority to do so from the SEC. Loans of portfolio
securities will be collateralized by cash, letters of credit or U.S.
Government Securities, which are maintained at all times in an amount equal
to at least 100% of the current market value of the loaned securities. Any
gain or loss in the market price of the securities loaned that might occur
during the term of the loan would be for the account of the Fund. From time
to time, the Fund may return a part of the interest earned from the
investment of collateral received for securities loaned to the borrower
and/or a third party that is unaffiliated with the Fund and that is acting as
a "finder."

By lending its securities, the Fund can increase its income by
continuing to receive interest and any dividends on the loaned securities as
well as by either investing the collateral received for securities loaned in
short-term instruments or obtaining yield in the form of interest paid by the
borrower when U.S. Government Securities are used as collateral. The Fund
will adhere to the following conditions whenever its portfolio securities are
loaned: (i) the Fund must receive at least 100% cash collateral or
equivalent securities of the type discussed in the preceding paragraph from
the borrower; (ii) the borrower must increase such collateral whenever the
market value of the securities rises above the level of such collateral;
(iii) the Fund must be able to terminate the loan at any time; (iv) the Fund
must receive reasonable interest on the loan, as well as any dividends,
interest or other distributions on the loaned securities and any increase in
market value; (v) the Fund may pay only reasonable custodian fees in
connection with the loan; and (vi) voting rights on the loaned securities may
pass to the borrower, provided, however, that if a material event adversely
affecting the investment occurs, the Trustees must terminate the loan and
regain the right to vote the securities. Loan agreements involve certain
risks in the event of default or insolvency of the other party including
possible delays or restrictions upon the Fund's ability to recover the loaned
securities or dispose of the collateral for the loan.

Aggressive Equity Fund and Global Independence Fund Only
- --------------------------------------------------------

Non-Diversified Status. The Aggressive Equity and Global Independence
Funds are classified as non-diversified investment companies under the 1940 Act,
which means that a Fund is not limited by the 1940 Act in the proportion of its
assets that it may invest in the obligations of a single issuer. Each Fund
will, however, comply with diversification requirements imposed by the Internal
Revenue Code of 1986, as amended (the "Code"), for qualification as a regulated
investment company. As a non-diversified investment company, a Fund may invest
a greater proportion of its assets in the obligations of a small number of
issuers and, as a result, may be subject to greater risk with respect to
portfolio securities. To the extent that a Fund assumes large positions in the
securities of a small number of issuers, its

27
<PAGE>

return may fluctuate to a greater extent than that of a diversified company as
a result of changes in the financial condition or in the market's assessment of
the issuers.

Below Investment Grade Securities. Each of these Funds may invest its
assets in non-investment grade securities (securities that are rated below the
fourth highest grade at the time of purchase by Moody's or S&P, or, if unrated,
deemed by CDC Investments to be of comparable quality). Subsequent to its
purchase by a Fund, an issue of securities may cease to be rated or its rating
may be reduced. Neither event will require a sale of such securities by a Fund,
although CDC Investments will consider such event in its determination of
whether a Fund should continue to hold the securities. The widespread expansion
of government, consumer and corporate debt within the economy has made the
corporate sector, especially cyclically sensitive industries, more vulnerable to
economic downturns or increased interest rates. Because lower-rated securities
involve issuers with weaker credit fundamentals (such as debt-to-equity ratios,
interest charge coverage, earnings history and the like), an economic downturn,
or increases in interest rates, could severely disrupt the market for
lower-rated securities and adversely affect the value of outstanding securities
and the ability of issuers to repay principal and interest.

The market values of below investment grade securities and unrated
securities of comparable quality tend to react less to fluctuations in interest
rate levels than do those of investment grade securities and the market values
of certain of these securities also tend to be more sensitive to individual
corporate developments and changes in economic conditions than higher-quality
securities. In addition, these securities generally present a higher degree of
credit risk. Issuers of these securities are often highly leveraged and may not
have more traditional methods of financing available to them so that their
ability to service their obligations during an economic downturn or during
sustained periods of rising interest rates may be impaired. The risk of loss
due to default by such issuers is significantly greater because below investment
grade securities generally are unsecured and frequently are subordinated to
prior payment of senior indebtedness. If the issuer of a security owned by a
Fund defaulted, a Fund could incur additional expenses in seeking recovery with
no guarantee of recovery. Also, a recession could disrupt severely the market
for such securities and may adversely affect the value of such securities and
the ability of the issuers of such securities to repay principal and pay
interest thereon. Lower-rated securities also present risks based on payment
expectations. For example, lower-rated securities may contain redemption or
call provisions. If an issuer exercises these provisions in a declining
interest rate market, a Fund would have to replace the security with a lower
yielding security, resulting in a decreased return for investors.

An economic recession could disrupt severely the market for such
securities and may adversely affect the value of such securities to repay
principal and pay interest thereon. The Funds may have difficulty disposing
of certain of these securities because there may be a thin trading market.
Because there is no established retail secondary market for many of these
securities, the Funds anticipate that these securities could be sold only to
a limited number of dealers or institutional investors. To the extent a
secondary

28
<PAGE>

trading market for these securities does exist, it generally is not as liquid as
the secondary market for investment grade securities. The lack of a liquid
secondary market, as well as adverse publicity and investor perception with
respect to these securities, may have an adverse impact on market price and a
Fund's ability to dispose of particular issues when necessary to meet liquidity
needs or in response to a specific economic event such as a deterioration in the
creditworthiness of the issuer. The lack of a liquid secondary market for
certain securities also may make it more difficult for the Funds to obtain
accurate market quotations for purposes of valuing the Funds and calculating net
asset value.

The market value of securities rated below investment grade is more
volatile than that of investment grade securities. Factors adversely impacting
the market value of these securities will adversely impact a Fund's net asset
value. The Funds will rely on the judgment, analysis and experience of CDC
Investments in evaluating the creditworthiness of an issuer. In this
evaluation, CDC Investments will consider, among other things, the issuer's
financial resources, its sensitivity to economic conditions and trends, its
operating history, the quality of the issuer's management and regulatory
matters. Normally, below investment grade securities and comparable unrated
securities are not intended for short-term investment. A Fund may incur
additional expenses to the extent it is required to seek recovery upon a default
in the payment of principal or interest on its portfolio holdings of such
securities.

Other Investment Limitations
- ----------------------------

The investment limitations numbered 1 through 8 may not be changed
without the affirmative vote of the holders of a majority of each Fund's
outstanding shares. Such majority is defined as the lesser of (i) 67% or more
of the shares present at the meeting, if the holders of more than 50% of the
outstanding shares of a Fund are present or represented by proxy, or (ii) more
than 50% of the outstanding shares. Investment limitations 9 through 14 may be
changed by a vote of the Trustees at any time.

Each Fund may not:

1. Borrow money except that a Fund may (a) borrow from banks for
temporary or emergency purposes and (b) enter into reverse repurchase
agreements; provided that reverse repurchase agreements, dollar roll
transactions that are accounted for as financings and any other transactions
constituting borrowing by a Fund may not exceed 33-1/3% of the value of a Fund's
total assets at the time of such borrowing. For purposes of this restriction,
short sales and the entry into currency transactions, options, futures
contracts, options on futures contracts, forward commitment transactions and
dollar roll transactions that are not accounted for as financings (and the
segregation of assets in connection with any of the foregoing) shall not
constitute borrowing.

2. Purchase any securities which would cause 25% or more of a value
of the Fund's total assets at the time of purchase to be invested in the
securities of issuers conducting their principal business activities in the same
industry; provided that to the extent the Fund's benchmark is concentrated in a
particular industry, the Fund will be concentrated in that industry. This
limitation does not apply to the purchase of U.S. Government Securities.

29
<PAGE>

3. With respect to the U.S. Core Equity Fund only, purchase the
securities of any issuer if as a result more than 5% of the value of a Fund's
total assets would be invested in the securities of such issuer, except that
this 5% limitation does not apply to U.S. Government Securities and except that
up to 25% of the value of a Fund's total assets may be invested without regard
to this 5% limitation.

4. Make loans, except that a Fund may purchase or hold fixed-income
securities, including structured securities, and enter into repurchase
agreements. The U.S. Core Equity Fund may also lend its portfolio securities in
an amount not to exceed 50% of its total assets.

5. Underwrite any securities issued by others except to the extent
that the investment in restricted securities and the sale of securities in
accordance with a Fund's investment objective, policies and limitations may be
deemed to be underwriting.

6. Purchase or sell real estate or invest in oil, gas or mineral
exploration or development programs, except that a Fund may invest in (a)
securities secured by real estate, mortgages or interests therein and (b)
securities of companies that invest in or sponsor oil, gas or mineral
exploration or development programs.

7. Invest in commodities, except that the Funds may purchase and
sell futures contracts, including those relating to securities, currencies and
indices, and options on futures contracts, securities, currencies or indices,
and purchase and sell currencies on a forward commitment or delayed-delivery
basis and enter into stand-by commitments, and, in the case of the Aggressive
Equity and Global Independence Funds, purchase or sell contracts relating to the
future delivery of precious metals.

8. Issue any senior security except as permitted in a Fund's
investment limitations.

9. Purchase securities on margin, except that a Fund may obtain any
short-term credits necessary for the clearance of purchases and sales of
securities. For purposes of this restriction, the deposit or payment of initial
or variation margin in connection with transactions in currencies, options,
futures contracts or related options will not be deemed to be a purchase of
securities on margin.

10. Purchase securities of other investment companies except in
connection with a merger, consolidation, acquisition, reorganization or offer of
exchange, or as otherwise permitted under the 1940 Act.

11. Pledge, mortgage or hypothecate its assets, except to the extent
necessary to secure permitted borrowings and to the extent related to the
deposit of assets in escrow and in connection with the writing of covered put
and call options and purchase of securities on a forward commitment or
delayed-delivery basis and collateral and initial or variation margin
arrangements with respect to currency transactions, options, futures contracts,
and options on futures contracts.

30
<PAGE>

12. Invest more than 15% of a Fund's net assets in securities which
may be illiquid because of legal or contractual restrictions on resale or
securities for which there are no readily available market quotations. For
purposes of this limitation, repurchase agreements with maturities greater than
seven days shall be considered illiquid securities.

13. Invest in rights or warrants (other than rights or warrants
acquired by a Fund as part of a unit or attached to securities at the time of
purchase) if, as a result, the investments (valued at the lower of cost or
market) would exceed 10% of the value of a Fund's net assets.

14. Make additional investments (including roll-overs) if a Fund's
borrowings exceed 5% of its net assets.

If a percentage restriction (other than the percentage limitation set
forth in No. 1 and No. 12) is adhered to at the time of an investment, a later
increase or decrease in the percentage of assets resulting from a change in the
values of portfolio securities or in the amount of a Fund's assets will not
constitute a violation of such restriction.

Portfolio Valuation
- -------------------

The Prospectus discusses the time at which the net asset value of each
Fund is determined for purposes of sales and redemptions. The following is a
description of the procedures used by each Fund in valuing its assets.

Securities listed on a U.S. securities exchange (including securities
traded through the NASDAQ National Market System) or foreign securities exchange
or traded in an over-the-counter market will be valued at the most recent sale
as of the time the valuation is made or, in the absence of sales, at the mean
between the bid and asked quotations. If there are no such quotations, the
value of the securities will be taken to be the highest bid quotation on the
exchange or market. Options are generally valued at the last sale price or, in
the absence of a last sale price, the last bid price. The value of a futures
contract equals the unrealized gain or loss on the contract that is determined
by marking it to the current settlement price for a like contract acquired on
the day on which the futures contract is being valued. A settlement price may
not be used if the market makes a limit move with respect to a particular
commodity. A security which is listed or traded on more than one exchange is
valued at the quotation on the exchange determined to be the primary market for
such security. Short-Term obligations with maturities of 60 days or less are
valued at amortized cost, which constitutes fair value as determined by the
Trustees. Amortized cost involves valuing a portfolio instrument at its initial
cost and thereafter assuming a constant amortization to maturity of any discount
or premium, regardless of the impact of fluctuating interest rates on the market
value of the instrument. The amortized cost method of valuation may also be
used with respect to other debt obligations with 60 days or less remaining to
maturity. Notwithstanding the foregoing, in determining the market value of
portfolio investments, a Fund may employ outside organizations (a "Price
Service") which may use a matrix, formula or other objective method that takes
into consideration market indexes, matrices, yield curves and other specific
adjustments. The procedures of Pricing Services are reviewed periodically

31
<PAGE>

by the officers of each Fund under the general supervision and responsibility of
the Trustees, which may replace a Pricing Service at any time. Securities,
options and futures contracts for which market quotations are not available and
certain other assets of a Fund will be valued at their fair value as determined
in good faith pursuant to consistently applied procedures established by the
Trustees. In addition, the Trustees or their delegates may value a security at
fair value if they determine that such security's value determined by the
methodology set forth above does not reflect its fair value.

Trading in securities in certain foreign countries is completed at
various times prior to the close of business on each business day in New York
(I.E., a day on which the New York Stock Exchange (the "NYSE") is open for
trading). In addition, securities trading in a particular country or countries
may not take place on all business days in New York. Furthermore, trading takes
place in various foreign markets on days which are not business days in New
York and days on which a Fund's net asset value is not calculated. As a result,
calculation of a Fund's net asset value may not take place contemporaneously
with the determination of the prices of certain foreign portfolio securities
used in such calculation. Events affecting the values of portfolio securities
that occur between the time their prices are determined and the close of regular
trading on the NYSE will not be reflected in a Fund's calculation of net asset
value unless the Trustees or their delegates deem that the particular event
would materially affect net asset value, in which case an adjustment may be
made. All assets and liabilities initially expressed in foreign currency values
will be converted into U.S. dollar values at the prevailing rate as quoted by a
Pricing Service. If such quotations are not available, the rate of exchange
will be determined in good faith pursuant to consistently applied procedures
established by the Trustees.

Portfolio Transactions
- ----------------------

CDC Investments is responsible for establishing, reviewing and, where
necessary, modifying each Fund's investment program to achieve its investment
objective. Purchases and sales of newly issued portfolio securities are usually
principal transactions without brokerage commissions effected directly with the
issuer or with an underwriter acting as principal. Other purchases and sales
may be effected on a securities exchange or over-the-counter, depending on where
it appears that the best price or execution will be obtained. The purchase
price paid by a Fund to underwriters of newly issued securities usually includes
a concession paid by the issuer to the underwriter, and purchases of securities
from dealers, acting as either principals or agents in the after market, are
normally executed at a price between the bid and asked price, which includes a
dealer's mark-up or mark-down. Transactions on U.S. stock exchanges and some
foreign stock exchanges involve the payment of negotiated brokerage commissions.
On exchanges on which commissions are negotiated, the cost of transactions may
vary among different brokers. On most foreign exchanges, commissions are
generally fixed. There is generally no stated commission in the case of
securities traded in domestic or foreign over-the-counter markets, but the price
of securities traded in over-the-counter markets includes an undisclosed
commission or mark-up. U.S. Government Securities are generally purchased from
underwriters or dealers, although certain

32
<PAGE>

newly issued U.S. Government Securities may be purchased directly from the U.S.
Treasury or from the issuing agency or instrumentality.

CDC Investments will select specific portfolio investments and effect
transactions for each Fund and in doing so seeks to obtain the overall best
execution of portfolio transactions. In evaluating prices and executions, CDC
Investments will consider the factors it deems relevant, which may include the
breadth of the market in the security, the price of the security, the financial
condition and execution capability of a broker or dealer and the reasonableness
of the commission, if any, for the specific transaction and on a continuing
basis. CDC Investments may, in its discretion, effect transactions in portfolio
securities with dealers who provide brokerage and research services (as those
terms are defined in Section 28(e) of the Securities Exchange Act of 1934) to
each Fund and/or other accounts over which CDC Investments exercises investment
discretion. CDC Investments may place portfolio transactions with a broker or
dealer with whom it has negotiated a commission that is in excess of the
commission another broker or dealer would have charged for effecting the
transaction if CDC Investments determines in good faith that such amount of
commission was reasonable in relation to the value of such brokerage and
research services provided by such broker or dealer viewed in terms of either
that particular transaction or of the overall responsibilities of CDC
Investments. Research and other services received may be useful to CDC
Investments in serving both a Fund and its other clients and, conversely,
research or other services obtained by the placement of business of other
clients may be useful to CDC Investments in carrying out its obligations to each
Fund. Research may include furnishing advice, either directly or through
publications or writings, as to the value of securities, the advisability of
purchasing or selling specific securities and the availability of securities or
purchasers or sellers of securities; furnishing seminars, information, analyses
and reports concerning issuers, industries, securities, trading markets and
methods, legislative developments, changes in accounting practices, economic
factors and trends and portfolio strategy; access to research analysts,
corporate management personnel, industry experts, economists and government
officials; comparative performance evaluation and technical measurement services
and quotation services; and products and other services (such as third party
publications, reports and analyses, and computer and electronic access,
equipment, software, information and accessories that deliver, process or
otherwise utilize information, including the research described above) that
assist CDC Investments in carrying out its responsibilities. Research received
from brokers or dealers is supplemental to CDC Investments' own research
program. The fees to CDC Investments under its advisory agreement with each
Fund are not reduced by reason of its receiving any brokerage and research
services.

Investment decisions for each Fund concerning specific portfolio
securities are made independently from those for other clients advised by CDC
Investments. Such other investment clients may invest in the same securities as
the Funds. When purchases or sales of the same security are made at
substantially the same time on behalf of such other clients, transactions are
averaged as to price and available investments allocated as to amount, in a
manner which CDC Investments believes to be equitable to each client, including
the Funds. In some instances, this investment procedure may adversely affect
the price paid or received by a Fund or the size of the position obtained or
sold for the Funds. To the extent permitted

33
<PAGE>

by law, CDC Investments may aggregate the securities to be sold or purchased for
a Fund with those to be sold or purchased for such other investment clients in
order to obtain best execution.

In no instance will portfolio securities be purchased from or sold to
CDC Investments or its affiliates. In addition, a Fund will not give preference
to any institutions with whom it enters into distribution or shareholder
servicing agreements concerning the provision of distribution services or
support services.

Transactions for a Fund may be effected on foreign securities
exchanges. In transactions for securities not actively traded on a foreign
securities exchange, a Fund will deal directly with the dealers who make a
market in the securities involved, except in those circumstances where better
prices and execution are available elsewhere. Such dealers usually are acting
as principal for their own account. On occasion, securities may be purchased
directly from the issuer. Such portfolio securities are generally traded on a
net basis and do not normally involve brokerage commissions. Securities firms
may receive brokerage commissions on certain portfolio transactions, including
options, futures and options on futures transactions and the purchase and sale
of underlying securities upon exercise of options.

Each Fund may participate, if and when practicable, in bidding for the
purchase of securities for its portfolio directly from an issuer in order to
take advantage of the lower purchase price available to members of such a group.
A Fund will engage in this practice, however, only when CDC Investments, in its
sole discretion, believes such practice to be otherwise in a Fund's interest.

Portfolio Turnover
- ------------------

Each Fund does not intend to seek profits through short-term trading,
but the rate of turnover will not be a limiting factor when a Fund deems it
desirable to sell or purchase securities. Each Fund's portfolio turnover rate
is calculated by the value of the securities purchased or sold, excluding all
securities whose maturities at the time of acquisition were one year or less,
divided by the average monthly value of such securities owned during the year.
Based on this calculation, instruments, including options and futures contracts,
with remaining maturities of less than one year are excluded from the portfolio
turnover rate.

Certain practices that may be employed by each Fund could result in
high portfolio turnover. For example, options on securities may be sold in
anticipation of a decline in the price of the underlying security (market
decline) or purchased in anticipation of a rise in the price of the underlying
security (market rise) and later sold. To the extent that its portfolio is
traded for the short-term, a Fund will be engaged essentially in trading
activities based on short-term considerations affecting the value of an issuer's
stock instead of long-term investments based on fundamental valuation of
securities. Because of this policy, portfolio securities may be sold without
regard to length of time for which they have been held. Consequently, the
annual portfolio turnover rate of a Fund may be higher than mutual funds having
a similar objective that do not use these strategies. The U.S. Core Equity Fund
expects its turnover rate for its first year of operation to total approximately
120% and the Aggressive

34
<PAGE>

Equity Fund and the Global Independence Fund expect their first year turnover
rate to total approximately 100%.

MANAGEMENT OF THE FUNDS

Officers and Trustees
- ---------------------

Each Fund's business and affairs is managed by its Trustees in
accordance with the law of the State of Delaware. The Trustees elect officers
who are responsible for the day-to-day operations of each Fund and who execute
policies formulated by the Trustees.

The names (and ages) of the Trustees and officers of the Trust, their
addresses, present positions and principal occupations during the past five
years and other affiliations are set forth below. Unless otherwise indicated,
the address of each officer is 9 West 57th Street, New York, New York 10019.

Luc de Clapiers*(53) Trustee.
CDC North America Inc. President and Chief Executive
9 West 57th Street Officer of CDC North America
New York, NY 10019 (the U.S. subsidiary of the
Caisse des Depots Group) since
[1989]

Bluford H. Putnam, Ph.D.* (48) President, Chief Investment
Officer and Trustee.
President of CDC Investments
since 1997; Managing Director
and Chief Investment Officer for
Equities and Asset Allocation
with the Global Investment
Management Department of Bankers
Trust Company in New York from
1994 to 1997; President of
Putnam & Associates, Inc. from
1991 to 1994.

* Indicates a Trustee who is an "interested person" of the Trust as defined
in the 1940 Act

35
<PAGE>

Mike West (42) Trustee.
Institute of Statistics Professor of Statistics and
and Decision Sciences Decision Sciences and Director
Duke University of the Institute of Statistics
Durham, NC 27708-0251 and Decision Sciences, Duke
University.

Arnold Zellner ( ) Trustee.
The University of Chicago H.G.B. Alexander Distinguished
Graduate School of Business Service Professor Emeritus of
1101 East 58th Street Economics and Statistics -
Chicago, IL 60637 Graduate School of Business,
University of Chicago; From 1984
to 1996, H.G.B. Alexander
Distinguished Service Professor
- Graduate School of Business,
University of Chicago.

Richard Levitch ( ) Trustee.
[Address to be provided] [Bio to be provided]

D. Sykes Wilford, Ph.D (49) Vice President and Investment
Officer.
Managing Director of CDC
Investments; Chief Investment
Officer of Bankers Trust Private
Bank and Managing Director of
Bankers Trust Global Investment
Management from 1994 to 1997;
Managing Director of Chase
Investment Bank, Ltd., London
from 1992 to 1994; Managing
Director of Chase Manhattan Bank
from 1988 to 1992.

36
<PAGE>

Jose Quintana (48) Vice President and Investment
Officer.
Managing Director of CDC
Investments; Vice President and
Head of Quantitative Research
for the Strategic Asset
Allocation team in the Global
Investment Management Group of
Bankers Trust Company from 1994
to 1997; Vice President in the
Global Risk Management Sector of
Chase Manhattan Bank from 1992
to 1994. Vice President at
Chase Investors Management
Corporation from 1988 to 1992;
Staff Supervisor for AT&T's
Market Analysis and Forecasting
Directorate from 1987 to 1988.

C. Peter Paterno (36) Treasurer.
Vice President of CDC
Investments; Financial
Consultant from 1995 to 1997;
Managing Director and Head of
Trading, Putnam & Associates
from 1993 to 1994; Director,
Panther Capital Advisers, Ltd.
in 1992; Vice President,
Proprietary Fixed Income
Trading, Merrill Lynch
International Ltd. from 1991 to
1992; Manager, International
Arbitrage, Kleinwort Benson Ltd.
from 1989 to 1991; Research
Analyst in the International
Fixed Income Strategy and
Economics Group at Morgan
Stanley & Co., Incorporated from
1986 to 1989.

Rachel D. Manney (31) Secretary.
Vice President of CDC
Investments; Vice President, BEA
Associates from 1992 to 1997;
Senior Associate, Coopers &
Lybrand, LLP from 1989 to 1992.

The Trust pays Trustees who are not "affiliated persons" (as defined in the 1940
Act) of CDC Investments, its administrator or distributor an annual fee of
$10,000 and $3,000 for each meeting attended by the Trustee for services as
Trustee, and each such Trustee is reimbursed for expenses incurred with the
Trustee's attendance at meetings.

37
<PAGE>

Trustees' Total Compensation:
- -----------------------------

Name of Trustee From the Trust+

Luc de Clapiers* None

Bluford H. Putnam* None

Mike West $22,000

Arnold Zellner $22,000

[ ] $22,000

________

+ Amounts shown are estimates of payments to be made for the Trust's first
full fiscal year ending December 31, 1999 pursuant to existing
arrangements.

* Mr. Putnam and Mr. de Clapiers receive compensation as affiliates of
CDC Investments and, accordingly, receive no compensation from the
Trust.

Control Persons and Principal Stockholders
- ------------------------------------------

CDC Investments will hold all of the shares of each Fund on the date
the Trust's Registration Statement becomes effective. The shares were issued
to CDC Investments for providing the initial seed capital to the Trust. It
is anticipated that shortly after the Trust's Registration Statement becomes
effective, CIMCO Holdings LLC ("CIMCO"), a Delaware limited liability company,
will invest approximately $25 million in each Fund. Master Holdings, a Cayman
Islands corporation, is the majority shareholder of CIMCO and CDC Investments
is a minority shareholder of CIMCO. CDC Group, Paris is the majority
shareholder of Master Holdings. CDC Investments is a wholly-owned subsidiary
of CDC Group, Paris. So long as CDC Investments or CIMCO owns more than 25%
of the outstanding voting securities of a Fund, it may be deemed to control
the Fund.

Investment Adviser and Administrator
- ------------------------------------

CDC Investments, located at 9 West 57th Street, 35th Floor, New York,
New York 10019, serves as investment adviser to each Fund pursuant to separate
written agreements (the "Advisory Agreements").

Management Fees
- ---------------

As described in the Prospectus, the U.S. Core Equity Fund pays the
Adviser a basic fee of 1.00%, and the Aggressive Equity Fund and the Global
Independence Fund each pay the Adviser a basic fee of 1.50%, of the respective
Fund's average daily net assets. This basic management fee may be adjusted
upward or downward by applying an adjustment formula (the "Performance
Adjustment"). The Performance Adjustment is calculated monthly by comparing the
Fund's investment performance to a target during the most recent twelve-month
period. The target for the U.S. Core Equity Fund and the Aggressive Equity Fund
is

38
<PAGE>

the investment record of the S&P 500 Index, and the target for the Global
Independence Fund is the investment record of the 90-day U.S. Treasury bill
rate. The difference between the Fund's performance compared to the performance
of the relevant target is multiplied by a Performance Adjustment of 25% (as an
annual rate). The Performance Adjustment is then added or subtracted from the
basic fee. The maximum annualized Performance Adjustment is 1.00% for the U.S.
Core Equity Fund and 1.50% for the Aggressive Equity Fund and the Global
Independence Fund.

Choice of Performance Benchmark
- -------------------------------

In the case of most equity strategies, the performance benchmark may
contain much of the risk to the investor, depending on how tightly or loosely
the adviser attempts to either track the benchmark or provide excess returns
above the return provided by the benchmark. The risks taken in a given
portfolio strategy will need to be measured in terms of the total risk of the
whole fund, as well as the risks taken in the attempt to earn excess returns
above the benchmark. In this latter case, one is conceptually separating the
fund into two portfolios, in which one matches the benchmark and the other
provides the excess return above the benchmark (noting that the excess return
can be negative if the strategy does not work as planned). The adviser will
need to measure and understand how the expected returns and risks in the
strategy designed to produce excess returns are correlated, if at all, to the
expected returns and risks inherent in the performance benchmark. All of these
concerns will have a bearing on the total risk being accepted by the investor in
a fund, and they are driven in part by the choice of the benchmark and in part
by the choice of strategies to out-perform the benchmark.

In the case of mutual funds using "fulcrum" fee formulas to raise or
lower the base management fee depending on fund performance, such as the Funds,
the choice of benchmark is a critical factor to be considered by the investor.
With incentive fees using the fulcrum fee approach, the total management fee
paid to the adviser will depend on a base fee as a percentage of assets under
management as well as a performance adjustment that will add to or subtract from
the base management fee depending explicitly on the magnitude of positive excess
returns above the benchmark or the magnitude of negative excess returns below
the benchmark. The design of the "fulcrum" around which the incentive fees
either add to or subtract from the base management fees hinges on the choice of
the benchmark. The investor, by buying shares of a fund utilizing fulcrum fees,
is providing incentives to the adviser to strive for higher excess returns and
to take additional risks. The adviser, when taking additional risks in order to
attempt to gain excess returns above the benchmark, knows that the total
management fees can rise or fall depending on performance. To a limited extent,
then, the adviser will benefit when the investor benefits, and the adviser will
suffer a detriment when the investor suffers a below-benchmark performance.

The formula used in the Funds for calculating the fulcrum fees is
discussed in more detail, with examples, in the Prospectus. Basically, the
total management fee can range from 0.00% (zero) to 2.00% of assets under
management in the case of the U.S. Core Equity Fund, and from 0.00% to 3.00% in
the case of the Aggressive Equity Fund and the Global

39
<PAGE>

Independence Fund. In the case of the U.S. Core Equity Fund, if the Fund
underperforms its benchmark by 4%, over a 12-month period, the minimum
management fee of 0.00% (zero) will apply. Correspondingly, if the Fund
overperforms its benchmark by 4%, the maximum total management fee of 2.00%
will apply. In the case of the Aggressive Equity Fund and the Global
Independence Fund, if a Fund underperforms its benchmark by 6%, over a
12-month period, the minimum management fee of 0.00% (zero) will apply.
Correspondingly, if a Fund overperforms its benchmark by 6%, the maximum
total management fee of 3.00% will apply.

Therefore, investors in the Funds should pay special attention to the
choice of benchmark since it plays a critical role in determining the total risk
of the Fund as well as the management fees charged by the Fund. The choice of
the benchmark for each Fund depends on a number of factors, including the
objectives of the Fund, the universe of securities and other investments which
the Adviser plans to utilize, the level of risks expected to be taken, and the
ability of the portfolio to develop strategies that attempt to out-perform the
benchmark.

In the case of the U.S. Core Equity Fund and the Aggressive Equity
Fund, the performance benchmark is the S&P 500 Index. Both of these Funds are
designed to give the investor a basic exposure to the U.S. equity market. The
S&P 500 Index is one of several established indexes that provide a good measure
of the core U.S. equity market. Other indexes cover the stocks of more
companies, but these additional company stocks are often very small and trade in
a relatively less liquid manner. In most market conditions, the S&P 500 Index
has a capitalization that includes 70% or more of other broad-based U.S. equity
indexes. In addition, the S&P 500 Index has a deep and liquid futures market
associated with it, giving the Adviser an effective tool for hedging the risks
of cash inflows and outflows in the funds, as well as managing other portfolio
risks or designing efficient strategies to enhance returns.

In the case of the Global Independence Fund, the performance benchmark
is the 90-day U.S. Treasury bill rate. The Global Independence Fund has several
characteristics that make this low risk benchmark appropriate. First, the
Global Independence Fund has a portfolio strategy that attempts to earn returns
in any market environment, whether the equity markets are rising or falling or
whether prices on U.S. Treasury debt securities are rising or falling.
Secondly, these strategies, for the most part, do not involve taking much
credit-related risk, but are focused on relative value and directional exposures
in the equity indexes, government bond markets and currencies of the major
industrial countries. To accomplish the efficient implementation of these
strategies, use may be made of exchange-traded futures contracts associated with
well-known equity indexes and actively-traded government bonds. As such,
regulatory practices often will require that a percentage of the Fund's assets
be held as U.S. Treasury bills as part of the margin requirements for accessing
these exchange-traded futures contracts.

In addition, the Global Independence Fund employs a portfolio approach
that tries, in part, to implement a set of concepts and theories based on modern
portfolio theory, in which the concept of the risk-free interest rate plays a
critical role. The U.S. Treasury bill rate is generally acknowledged in most
academic circles to represent a risk-free interest rate.

40
<PAGE>

Nothing, of course, that earns a return is truly risk-free, but the U.S.
Treasury is generally the standard for low credit risk, and short-term U.S.
Treasury bills contain very little directional interest rate risk (interest rate
duration risk). Thus, the 90-day U.S. Treasury bill rate is an appropriate
benchmark or target for a fund that attempts to be independent of the general
moves in equities or interest rates and does not employ strategies primarily
dependent on credit risk.

The only real competitor to the U.S. Treasury bill rate as a
"risk-free" interest rate benchmark is the 90-day London Interbank Offered Rate,
or LIBOR. This interest rate is offered by commercial and investment banks as
the interest rate on deposits from large institutional investors. It is not
without credit risk, regardless of how small that risk may sometimes seem.
Large global banks can and do lose money from time to time in certain market
environments. Large global banks can and do see their credit ratings change,
which will often affect the interest rates they must pay for borrowed funds.
The liquidity of the LIBOR market can be affected by adverse events in the
financial marketplace, widening the yield spread between the LIBOR maturity
curve and the corresponding U.S. Treasury yield curve. There is real risk in
the LIBOR swap yield curve for different maturities. For example, advisers that
seek to insulate their funds from directional interest rate risk must choose
between futures hedging based on the U.S. Treasury market and swaps hedging
based on the LIBOR curve, and the resulting performance difference on a few
occasions can be material.

For all these reasons, CDC Investments have chosen the 90-day
U.S. Treasury bill rate as the benchmark for the Global Independence Fund.
Investors should note, however, that investments made in the London Interbank
deposit market at LIBOR would provide a small spread over the U.S. Treasury
bill rate and potentially help the Adviser earn additional fees as part of
the "fulcrum" fee formula, assuming the overall strategy produced excess
returns.

Under the Advisory Agreements, CDC Investments will not be liable for
any error of judgment or mistake of law or for any loss suffered by a Fund in
connection with the matters to which the Advisory Agreements relate. The
Advisory Agreements for the Funds were approved on December 1, 1998 by a vote of
the Trustees, including a majority of those Trustees who are not parties to the
Advisory Agreements or interested persons (as defined in the 1940 Act) of such
parties. The Advisory Agreements were also approved by each Fund's initial
shareholder. The Advisory Agreements are terminable by vote of the Trustees or
by the holders of a majority of the outstanding voting securities of the
relevant Fund, and at any time without penalty, on 60 days' written notice to
CDC Investments. The Advisory Agreements may also be terminated by CDC
Investments on 90 days' written notice to a Fund. The Advisory Agreements
terminate automatically in the event of an assignment.

[ ] located at [ ] serves as
administrator (the "Administrator") to each Fund pursuant to separate written
agreements. The Administrator provides shareholder liaison services to each
Fund, including responding to shareholder inquiries and providing information on
shareholder investments. The Administrator also performs a variety of other
services, including furnishing certain executive and administrative

41
<PAGE>

services, acting as liaison between the Funds and their various service
providers, furnishing certain corporate secretarial services, which include
preparing materials for meetings of the Trustees, assisting with proxy
statements and annual and semiannual reports, assisting in the preparation of
tax returns and monitoring and developing certain compliance procedures for the
Funds. The Administrator also calculates each Fund's net asset value, provides
all accounting services for each Fund and assists in related aspects of each
Fund's operations. As compensation, each Fund will pay the Administrator a fee
calculated at an annul rate of [ %] of its average daily net assets.

Each class of shares of a Fund bears its proportionate share of fees
payable to CDC Investments and the Administrator in the proportion that its
assets bear to the aggregate assets of a Fund at the time of calculation. These
fees are calculated at an annual rate based on a percentage of a Fund's average
daily net assets. CDC Investments or the Administrator may voluntarily waive a
portion of their fees from time to time and temporarily limit the expenses to be
borne by a Fund.

Distribution and Shareholder Servicing
- --------------------------------------

[ ] located at [ ] (the
"Distributor") serves as the distributor of the shares of each Fund.

Investor Shares. Each Fund has entered into a Shareholder Servicing
and Distribution Plan (the "12b-1 Plan") pursuant to Rule 12b-1 under the 1940
Act, under which each Fund will pay the Distributor, in consideration for
Services (as defined below), a fee calculated at an annual rate of 0.25% of the
average daily net assets of each Fund's Investor shares. Services performed by
the Distributor include: (i) the sale of the Investor shares, as set forth in
the 12b-1 Plan ("Selling Services"), (ii) ongoing servicing and/or maintenance
of the accounts of the Investor shares, as set forth in the 12b-1 Plan
("Shareholder Services"), and (iii) sub-transfer agency services, subaccounting
services or administrative services related to the sale of the Investor shares,
as set forth in the 12b-1 Plan ("Administrative Services" and collectively with
Selling Services and Administrative Services, "Services") including, without
limitation, (a) payments reflecting an allocation of overhead and other office
expenses of the Distributor related to providing Services; (b) payments made to,
and reimbursement of expenses of, persons who provide support services in
connection with the distribution of the Investor shares including, but not
limited to, office space and equipment, telephone facilities, answering routine
inquiries regarding a Fund, and providing any other Shareholder Services; (c)
payments made to compensate selected dealers or other authorized persons for
providing any Services; (d) costs relating to the formulation and implementation
of marketing and promotional activities for the Investor shares, including, but
not limited to, direct mail promotions and television, radio, newspaper,
magazine and other mass media advertising, and related travel and entertainment
expenses; (e) costs of printing and distributing prospectuses, statements of
additional information and reports of the Funds to prospective shareholders of
the Funds; and (f) costs involved in obtaining whatever information, analyses
and reports with respect to marketing and promotional activities that the Funds
may, from time to time, deem advisable.

42
<PAGE>

Pursuant to the 12b-1 Plan, the Distributor will provide each Fund's
Trustees with periodic reports of amounts expended under the 12b-1 Plan and the
purpose for which the expenditures were made.

Institutional Shares. The Distributor will serve as distributor to
the Institutional shares of each Fund without compensation.

General. The 12b-1 Plan will continue in effect for so long as its
continuance is specifically approved at least annually by the Trustees,
including a majority of the Trustees who are not interested persons of each Fund
and who have no direct or indirect financial interest in the operation of the
Distribution Plan ("Independent Trustees"). Any material amendment of the
Distribution Plan would require the approval of the Trustees in the manner
described above. The Distribution Plan may not be amended to increase
materially the amount to be spent under it without shareholder approval of the
Investor shares. The Distribution Plan may be terminated at any time, without
penalty, by vote of a majority of the Independent Trustees or by a vote of a
majority of the outstanding voting securities of the Investor shares of each
Fund.

Custodian and Transfer Agent
- ----------------------------

[ ] located at [ ] (the "Custodian") acts as
custodian for each Fund and also acts as the custodian for each Fund's foreign
securities pursuant to written Custodian Agreements (the "Custodian Agreement").
The Custodian will (i) maintain a separate account or accounts in the name of
each Fund, (ii) hold and transfer portfolio securities on account of each Fund,
(iii) accept receipts and disbursements of money on behalf of each Fund, (iv)
collect and receive all income and other payments and distributions for the
account of each Fund's portfolio securities and (v) make periodic reports to the
Trustees concerning each Fund's custodial arrangements. The Custodian is
authorized to select one or more foreign banking institutions and foreign
securities depositories to serve as sub-custodian on behalf of the Funds,
provided that the Custodian remains responsible for the performance of all its
duties under the Custodian Agreement and holds the Funds harmless from the
negligent acts and omissions of any sub-custodian. For its services to the
Funds under the Custodian Agreement, the Custodian receives a fee which is
calculated based upon each Fund's average daily gross assets, exclusive of
transaction charges and out-of-pocket expenses, which are also charged to the
Funds.

[ ] located at [ ] (the "Transfer Agent") serves
as each Fund's shareholder servicing, transfer and dividend disbursing agent
pursuant to written Transfer Agency and Service Agreements, under which the
Transfer Agent (i) issues and redeems shares of the Funds, (ii) addresses and
mails all communications by the Funds to record owners of each Fund's shares,
including reports to shareholders, dividend and distribution notices and proxy
material for meetings of shareholders, (iii) maintains shareholder accounts and,
if requested, sub-accounts and (iv) makes periodic reports to the Trustees
concerning the Transfer Agent's operations with respect to the Funds.

43
<PAGE>

Capital Stock
- -------------

The Trust Instrument authorizes the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest of which an
unlimited number are designated Investor shares and an unlimited number are
designated Institutional shares. The Trust Instrument currently has three
separate series: U.S. Core Equity Fund, Aggressive Equity Fund, and Global
Independence Fund. Each Fund will be comprised of both Institutional shares and
Investor shares. Institutional shares are sold directly by the Funds'
distributor and may be purchased by endowments, foundations and plan sponsors of
401(a), 401(k), 457 and 403(b) plans and by individuals. Investor shares may be
purchased by intermediary financial institutions (including broker-dealers,
investment advisers, financial planners, banks and insurance companies), and
certain individual retirement accounts and individuals. Investment
professionals may purchase Investor shares for discretionary or
non-discretionary accounts maintained by individuals.

Under the Trust Instrument, the Trustees have the power (without
shareholder approval) to classify or reclassify any unissued shares of the Trust
into one or more additional classes by setting or changing in any one or more
respects their relative rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption. The Trustees
may similarly classify or reclassify any class of the Trust's shares into one or
more series and, without shareholder approval, may increase the number of
authorized shares of the Trust.

All shareholders of a Fund in each class, upon liquidation, will
participate ratably in the Fund's net assets. Shares do not have cumulative
voting rights, which means that holders of more than 50% of the shares voting
for the election of Trustees can elect all Trustees. Shares are transferable
but have no preemptive, conversion or subscription rights.

Investors in each Fund are entitled to one vote for each full share
held and fractional votes for fractional shares held. Shareholders of each Fund
will vote in the aggregate except where otherwise required by law and except
that the Investor Class will vote separately on certain matters pertaining to
its distribution and shareholder servicing arrangements. There will normally be
no meetings of investors for the purpose of electing Trustees unless and until
such time as less than a majority of the Trustees holding office have been
elected by investors. Investors of record of no less than two-thirds of the
outstanding shares of the Trust may remove a Trustee through a declaration in
writing or by vote cast in person or by proxy at a meeting called for the
purpose. A meeting will be called for the purpose of voting on the removal of a
Trustee at the written request of holders of 10% of the outstanding shares.

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

The offering price of each Fund's shares is equal to the per share net
asset value of the relevant class of shares of each Fund.

Under the 1940 Act, each Fund may suspend the right of redemption or
postpone the date of payment upon redemption for any period during which the
NYSE is closed, other than customary weekend and holiday closings, or during
which trading on the

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<PAGE>

NYSE is restricted, or during which (as determined by the SEC) an emergency
exists as a result of which disposal or fair valuation of portfolio securities
is not reasonably practicable, or for such other periods as the SEC may permit.
(Each Fund may also suspend or postpone the recordation of an exchange of its
shares upon the occurrence of any of the foregoing conditions.)

If a shareholder's account falls below $500, a Fund may ask the
shareholder to increase its balance. If the balance remains below $500 after 45
days, a Fund may close a shareholder's account and redeem the proceeds to the
shareholder.

If the Trustees determines that conditions exist which make payment of
redemption proceeds wholly in cash unwise or undesirable, a Fund may make
payment wholly or partly in securities or other investment instruments which may
not constitute securities as such term is defined in the applicable securities
laws. If a redemption is paid wholly or partly in securities or other property,
a shareholder would incur transaction costs in disposing of the redemption
proceeds. Each Fund intends to comply with Rule 18f-1 promulgated under the
1940 Act with respect to redemptions in kind.

Automatic Cash Withdrawal Plan. An automatic cash withdrawal plan
(the "Plan") is available to shareholders who wish to receive specific amounts
of cash periodically. Withdrawals may be made under the Plan by redeeming as
many shares of each Fund as may be necessary to cover the stipulated withdrawal
payment. To the extent that withdrawals exceed dividends, distributions and
appreciation of a shareholder's investment in a Fund, there will be a reduction
in the value of the shareholder's investment and continued withdrawal payments
may reduce the shareholder's investment and ultimately exhaust it. Withdrawal
payments should not be considered as income from investment in a Fund. All
dividends and distributions on shares in the Plan are automatically reinvested
at net asset value in additional shares of a Fund.

EXCHANGE PRIVILEGE

An exchange privilege among the Funds is available to investors.
Investors can exchange their Investor and Institutional shares for Investor and
Institutional shares of other funds advised by CDC Investments.

This exchange privilege enables shareholders to acquire shares in a
fund with a different investment objective when they believe that a shift
between funds is an appropriate investment decision. This privilege is
available to shareholders residing in any state in which the Investor shares or
Institutional shares being acquired, as relevant, may legally be sold.
Shareholders may exchange $1,000,000 or more of the Institutional shares and
$2,500 or more of the Investor shares from one fund into the same class of
shares of another fund. There is no minimum for retirement accounts. Prior to
any exchange, shareholders should obtain and review a copy of the current
prospectus of the relevant class of each fund into which an exchange is being
considered.

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<PAGE>

Upon receipt of proper instructions and all necessary supporting
documents, shares submitted for exchange are redeemed at the then-current net
asset value of the relevant class and the proceeds are invested on the same day,
at a price as described above, in shares of the relevant class of the fund being
acquired. Each Fund may refuse any purchase or exchange request that could
adversely affect a Fund or its operations, including those from any individual
or group who, in a Fund's view, is likely to engage in excessive trading
(usually defined as more than four exchange out of a Fund within a calendar
year), and any purchase or exchange request in excess of 1% of a Fund's total
assets. Each Fund may also (i) change or discontinue its exchange privilege or
temporarily suspend this privilege during unusual market conditions; (ii) change
its minimum investment amounts; (iii) delay sending out redemption proceeds for
up to seven days if doing so sooner would adversely affect a Fund (this
generally applies only in cases of very large redemptions, excessive trading or
during unusual market conditions); and (iv) make a "redemption in kind" --
payment in portfolio securities rather than cash -- if the amount an investor is
redeeming is large enough to affect a Fund's operations. The exchange privilege
may be modified or terminated at any time upon 60 days' notice to shareholders.

ADDITIONAL INFORMATION CONCERNING TAXES

The following is a summary of the material U.S. federal income tax
considerations regarding the purchase, ownership and disposition of shares in
each Fund. Each prospective shareholder is urged to consult his own tax adviser
with respect to the specific federal, state, local and foreign tax consequences
of investing in a Fund. The summary is based on the laws in effect on the date
of this Statement of Additional Information, which are subject to change.

The Funds and their Investments
- -------------------------------

Each Fund intends to qualify to be treated as a regulated investment
company each taxable year under the Code. To so qualify, a Fund must, among
other things: (a) derive at least 90% of its gross income in each taxable year
from dividends, interest, payments with respect to securities loans and gains
from the sale or other disposition of stock or securities or foreign currencies,
or other income (including, but not limited to, gains from options, futures or
forward contracts) derived with respect to its business of investing in such
stock, securities or currencies; and (b) diversify its holdings so that, at the
end of each quarter of a Fund's taxable year, (i) at least 50% of the market
value of a Fund's assets is represented by cash, securities of other regulated
investment companies, U.S. government securities and other securities, with such
other securities limited, in respect of any one issuer, to an amount not greater
than 5% of a Fund's assets and not greater than 10% of the outstanding voting
securities of such issuer and (ii) not more than 25% of the value of its assets
is invested in the securities (other than U.S. government securities or
securities of other regulated investment companies) of any one issuer or any two
or more issuers that a Fund controls and are determined to be engaged in the
same or similar trades or businesses or related trades or businesses. Each Fund
expects that all of its foreign currency gains will be directly related to its
principal business of investing in stocks and securities.

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<PAGE>

As a regulated investment company, each Fund will not be subject to
U.S. federal income tax on its net investment income (i.e., income other than
its net realized long- and short-term capital gains) and its net realized long-
and short-term capital gains, if any, that it distributes to its shareholders,
provided that an amount equal to at least 90% of the sum of its investment
company taxable income (i.e., 90% of its taxable income minus the excess, if
any, of its net realized long-term capital gains over its net realized
short-term capital losses (including any capital loss carryovers), plus or minus
certain other adjustments as specified in the Code) and its net tax-exempt
income for the taxable year is distributed, but will be subject to tax at
regular corporate rates on any taxable income or gains that it does not
distribute. No more than 10% of each Fund's gross income may be from
nonqualifying sources, including income from investments in physical commodities
and related options in the case of the Aggressive Equity and Global Independence
Funds. A Fund may therefore need to limit the extent to which it makes such
investments in order to qualify as a regulated investment company. Furthermore,
each Fund will be subject to a U.S. corporate income tax with respect to such
distributed amounts in any year that it fails to qualify as a regulated
investment company or fails to meet this distribution requirement. Any dividend
declared by a Fund in October, November or December of any calendar year and
payable to shareholders of record on a specified date in such a month shall be
deemed to have been received by each shareholder on December 31 of such calendar
year and to have been paid by a Fund not later than such December 31, provided
that such dividend is actually paid by a Fund during January of the following
calendar year.

The Code imposes a 4% nondeductible excise tax on each Fund to the
extent a Fund does not distribute by the end of any calendar year at least 98%
of its net investment income for that year and 98% of the net amount of its
capital gains (both long-and short-term) for the one-year period ending, as a
general rule, on October 31 of that year. For this purpose, however, any income
or gain retained by a Fund that is subject to corporate income tax will be
considered to have been distributed by year-end. In addition, the minimum
amounts that must be distributed in any year to avoid the excise tax will be
increased or decreased to reflect any underdistribution or overdistribution, as
the case may be, from the previous year. Each Fund anticipates that it will pay
such dividends and will make such distributions as are necessary in order to
avoid the application of this tax.

With regard to a Fund's investments in foreign securities, exchange
control regulations may restrict repatriations of investment income and capital
or the proceeds of securities sales by foreign investors such as a Fund and may
limit a Fund's ability to pay sufficient dividends and to make sufficient
distributions to satisfy the 90% and excise tax distribution requirements.

If, in any taxable year, a Fund fails to qualify as a regulated
investment company under the Code, it would be taxed in the same manner as an
ordinary corporation and distributions to its shareholders would not be
deductible by a Fund in computing its taxable income. In addition, in the event
of a failure to qualify, a Fund's distributions, to the extent derived from a
Fund's current or accumulated earnings and profits, would constitute dividends
(eligible for the corporate dividends-received deduction) which are taxable to
shareholders as

47
<PAGE>

ordinary income, even though those distributions might otherwise (at least in
part) have been treated in the shareholders' hands as long-term capital gains.
If a Fund fails to qualify as a regulated investment company in any year, it
must pay out its earnings and profits accumulated in that year in order to
qualify again as a regulated investment company. In addition, if a Fund failed
to qualify as a regulated investment company for a period greater than one
taxable year, a Fund may be required to recognize any net built-in gains (the
excess of the aggregate gains, including items of income, over aggregate losses
that would have been realized if it had been liquidated) in order to qualify as
a regulated investment company in a subsequent year.

Each Fund's short sales against the box, if any, and transactions in
foreign currencies, forward contracts, options and futures contracts (including
options and futures contracts on foreign currencies) will be subject to special
provisions of the Code that, among other things, may affect the character of
gains and losses realized by a Fund (i.e., may affect whether gains or losses
are ordinary or capital), accelerate recognition of income to a Fund and defer
Fund losses. These rules could therefore affect the character, amount and
timing of distributions to shareholders. These provisions also (a) will require
a Fund to mark-to-market certain types of the positions in its portfolio (i.e.,
treat them as if they were closed out) and (b) may cause a Fund to recognize
income without receiving cash with which to pay dividends or make distributions
in amounts necessary to satisfy the distribution requirements for avoiding
income and excise taxes. Each Fund will monitor its transactions, will make the
appropriate tax elections and will make the appropriate entries in its books and
records when it engages in a short sale against the box or acquires any foreign
currency, forward contract, option, futures contract or hedged investment in
order to mitigate the effect of these rules and prevent disqualification of a
Fund as a regulated investment company.

Each Fund's investments in zero coupon securities, if any, may create
special tax consequences. Zero coupon securities do not make interest payments,
although a portion of the difference between a zero coupon security's face value
and its purchase price is imputed as income to a Fund each year even though a
Fund receives no cash distribution until maturity. Under the U.S. federal tax
laws, a Fund will not be subject to tax on this income if it pays dividends to
its shareholders substantially equal to all the income received from, or imputed
with respect to, its investments during the year, including its zero coupon
securities. These dividends ordinarily will constitute taxable income to the
shareholders of each Fund.

Passive Foreign Investment Companies. If a Fund purchases shares in
certain foreign investment entities, called "passive foreign investment
companies" (a "PFIC"), it may be subject to U.S. federal income tax on a portion
of any "excess distribution" or gain from the disposition of such shares even if
such income is distributed as a taxable dividend by a Fund to its shareholders.
Additional charges in the nature of interest may be imposed on a Fund in respect
of deferred taxes arising from such distributions or gains. If a Fund were to
invest in a PFIC and elected to treat the PFIC as a "qualified electing fund"
under the Code, in lieu of the foregoing requirements, a Fund might be required
to include in income each year a portion of the ordinary earnings and net
capital gains of the qualified electing fund, even if not distributed to a Fund,
and such amounts would be subject to the 90% and excise tax distribution
requirements described above. In order to make this election, a Fund would be

48
<PAGE>

required to obtain certain annual information from the passive foreign
investment companies in which it invests, which may be difficult or not possible
to obtain.

Recently, legislation was enacted that provides a mark-to-market
election for regulated investment companies effective for taxable years
beginning after December 31, 1997. This election would result in a Fund being
treated as if it had sold and repurchased all of the PFIC stock at the end of
each year. In this case, a Fund would report gains as ordinary income and would
deduct losses as ordinary losses to the extent of previously recognized gains.
The election, once made, would be effective for all subsequent taxable years of
a Fund, unless revoked with the consent of the Internal Revenue Service (the
"IRS"). By making the election, a Fund could potentially ameliorate the adverse
tax consequences with respect to its ownership of shares in a PFIC, but in any
particular year may be required to recognize income in excess of the
distributions it receives from PFICs and its proceeds from dispositions of PFIC
company stock. A Fund may have to distribute this "phantom" income and gain to
satisfy its distribution requirement and to avoid imposition of the 4% excise
tax. Each Fund will make the appropriate tax elections, if possible, and take
any additional steps that are necessary to mitigate the effect of these rules.

49
<PAGE>

Taxation of United States Shareholders
- --------------------------------------

Dividends and Distributions. Any dividend declared by a Fund in October,
November or December of any calendar year and payable to shareholders of record
on a specified date in such a month shall be deemed to have been received by
each shareholder on December 31 of such calendar year and to have been paid by a
Fund not later than such December 31, provided that such dividend is actually
paid by a Fund during January of the following calendar year. Each Fund intends
to distribute annually to its shareholders substantially all of its investment
company taxable income, and any net realized long-term capital gains in excess
of net realized short-term capital losses (including any capital loss
carryovers). Each Fund currently expects to distribute any excess annually to
its shareholders. However, if a Fund retains for investment an amount equal to
all or a portion of its net long-term capital gains in excess of its net
short-term capital losses and capital loss carryovers, it will be subject to a
corporate tax (currently at a rate of 35%) on the amount retained. In that
event, a Fund intends to designate such retained amounts as undistributed
capital gains in a notice to its shareholders who (a) will be required to
include in income for United States federal income tax purposes, as long-term
capital gains, their proportionate shares of the undistributed amount, (b) will
be entitled to credit their proportionate shares of the 35% tax paid by the Fund
on the undistributed amount against their United States federal income tax
liabilities, if any, and to claim refunds to the extent their credits exceed
their liabilities, if any, and (c) will be entitled to increase their tax basis,
for United States federal income tax purposes, in their shares by an amount
equal to 65% of the amount of undistributed capital gains included in the
shareholder's income. Organizations or persons not subject to federal income
tax on such capital gains will be entitled to a refund of their pro rata share
of such taxes paid by a Fund upon filing appropriate returns or claims for
refund with the IRS.

Dividends of net investment income and distributions of net realized
short-term capital gains are taxable to a U.S. shareholder as ordinary income,
whether paid in cash or in shares. Distributions of net-long-term capital
gains, if any, that a Fund designates as capital gains dividends are taxable as
long-term capital gains, whether paid in cash or in shares and regardless of how
long a shareholder has held shares of a Fund. Dividends and distributions paid
by a Fund (except for the portion thereof, if any, attributable to dividends on
stock of U.S. corporations received by a Fund) will not qualify for the
deduction for dividends received by corporations. Distributions in excess of a
Fund's current and accumulated earnings and profits will, as to each
shareholder, be treated as a tax-free return of capital, to the extent of a
shareholder's basis in his shares of a Fund, and as a capital gain thereafter
(if the shareholder holds his shares of a Fund as capital assets).

Shareholders receiving dividends or distributions in the form of
additional shares should be treated for U.S. federal income tax purposes as
receiving a distribution in the amount equal to the amount of money that the
shareholders receiving cash dividends or distributions will receive, and should
have a cost basis in the shares received equal to such amount.

Investors considering buying shares just prior to a dividend or
capital gain

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<PAGE>

distribution should be aware that, although the price of shares just purchased
at that time may reflect the amount of the forthcoming distribution, such
dividend or distribution may nevertheless be taxable to them.

If a Fund is the holder of record of any stock on the record date for
any dividends payable with respect to such stock, such dividends are included in
a Fund's gross income not as of the date received but as of the later of (a) the
date such stock became ex-dividend with respect to such dividends (i.e., the
date on which a buyer of the stock would not be entitled to receive the
declared, but unpaid, dividends) or (b) the date a Fund acquired such stock.
Accordingly, in order to satisfy its income distribution requirements, a Fund
may be required to pay dividends based on anticipated earnings, and shareholders
may receive dividends in an earlier year than would otherwise be the case.

Sales of Shares. Upon the sale or exchange of his shares, a
shareholder will realize a taxable gain or loss equal to the difference between
the amount realized and his basis in his shares. Such gain or loss will be
treated as capital gain or loss, if the shares are capital assets in the
shareholder's hands, and will be long-term capital gain or loss if the shares
are held for more than one year and short-term capital gain or loss if the
shares are held for one year or less. Any loss realized on a sale or exchange
will be disallowed to the extent the shares disposed of are replaced, including
replacement through the reinvesting of dividends and capital gains distributions
in a Fund, within a 61-day period beginning 30 days before and ending 30 days
after the disposition of the shares. In such a case, the basis of the shares
acquired will be increased to reflect the disallowed loss. Any loss realized by
a shareholder on the sale of a Fund share held by the shareholder for six months
or less will be treated for U.S. federal income tax purposes as a long-term
capital loss to the extent of any distributions or deemed distributions of
long-term capital gains received by the shareholder with respect to such share.

Backup Withholding. Each Fund may be required to withhold, for U.S.
federal income tax purposes, 31% of the dividends and distributions payable to
shareholders who fail to provide a Fund with their correct taxpayer
identification number or to make required certifications, or who have been
notified by the IRS that they are subject to backup withholding. Certain
shareholders are exempt from backup withholding. Backup withholding is not an
additional tax and any amount withheld may be credited against a shareholder's
U.S. federal income tax liabilities.

Notices. Shareholders will be notified annually by each Fund as to
the U.S. federal income tax status of the dividends, distributions and deemed
distributions attributable to undistributed capital gains (discussed above in
"The Funds and Their Investments") made by a Fund to its shareholders.
Furthermore, shareholders will also receive, if appropriate, various written
notices after the close of a Fund's taxable year regarding the U.S. federal
income tax status of certain dividends, distributions and deemed distributions
that were paid (or that are treated as having been paid) by a Fund to its
shareholders during the preceding taxable year.

Other Taxation
- --------------

51
<PAGE>

Distributions also may be subject to additional state, local and
foreign taxes depending on each shareholder's particular situation.

THE FOREGOING IS ONLY A SUMMARY OF CERTAIN MATERIAL TAX CONSEQUENCES AFFECTING
THE FUND AND ITS SHAREHOLDERS. SHAREHOLDERS ARE ADVISED TO CONSULT THEIR OWN
TAX ADVISERS WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES TO THEM OF AN
INVESTMENT IN THE FUNDS.

DETERMINATION OF PERFORMANCE

From time to time, a Fund may quote the total return of its Investor
shares and/or Institutional shares in advertisements or in reports and other
communications to shareholders. These total return figures show the average
percentage change in value of an investment in the Investor and/or Institutional
shares from the beginning of the measuring period to the end of the measuring
period. The figures reflect changes in the price of the Investor and/or
Institutional shares assuming that any income dividends and/or capital gain
distributions made by a Fund during the period were reinvested in Investor
and/or Institutional shares of a Fund. Total return will be shown for recent
one-, five- and ten-year periods, and may be shown for other periods as well
(such as from commencement of a Fund's operations or on a year-by-year,
quarterly or current year-to-date basis). These figures are calculated by
finding the average annual compounded rates of return for the one-, five- and
ten- (or such shorter period as the relevant class of shares has been offered)
year periods that would equate the initial amount invested to the ending
redeemable value according to the following formula: P (1 + T)n = ERV. For
purposes of this formula, "P" is a hypothetical investment of $1,000; "T" is
average annual total return; "n" is number of years; and "ERV" is the ending
redeemable value of a hypothetical $1,000 payment made at the beginning of the
one-, five- or ten-year periods (or fractional portion thereof). Total return
or "T" is computed by finding the average annual change in the value of an
initial $1,000 investment over the period and assumes that all dividends and
distributions are reinvested during the period.

When considering average total return figures for periods longer than
one year, it is important to note that the annual total return for one year in
the period might have been greater or less than the average for the entire
period. When considering total return figures for periods shorter than one
year, investors should bear in mind that each Fund seeks long-term appreciation
and that such return may not be representative of any Fund's return over a
longer market cycle. Each Fund may also advertise aggregate total return
figures of its Investor and/or Institutional shares for various periods,
representing the cumulative change in value of an investment in the Investor
and/or Institutional shares for the specific period (again reflecting changes in
share prices and assuming reinvestment of dividends and distributions).
Aggregate and average total returns may be shown by means of schedules, charts
or graphs and may indicate various components of total return (I.E., change in
value of initial investment, income dividends and capital gain distributions).
Investors should note that total return figures are based on historical earnings
and are not intended to indicate future performance.

Each Fund may advertise, from time to time, comparisons of the
performance and the expense ratio of its Investor shares and/or Institutional
shares with that of one or more

52
<PAGE>

other mutual funds with similar investment objectives. Each Fund may advertise
average annual calendar year-to-date and calendar quarter returns, which are
calculated according to the formula set forth in the preceding paragraph, except
that the relevant measuring period would be the number of months that have
elapsed in the current calendar year or most recent three months, as the case
may be. Investors should note that this performance may not be representative
of a Fund's total return in longer market cycles.

The performance of a class of Fund shares will vary from time to time
depending upon market conditions, the composition of a Fund's portfolio and
operating expenses allocable to it. As described above, total return is based
on historical earnings and is not intended to indicate future performance.
Consequently, any given performance quotation should not be considered as
representative of performance for any specified period in the future.
Performance information may be useful as a basis for comparison with other
investment alternatives. However, a Fund's performance will fluctuate, unlike
certain bank deposits or other investments which pay a fixed yield for a stated
period of time. Any fees charged by institutions or other institutional
investors directly to their customers in connection with investments in Fund
shares are not reflected in a Fund's total return, and such fees, if charged,
will reduce the actual return received by customers on their investments.

In its reports, investor communications or advertisements, each Fund
may include: (i) its total return performance; (ii) its performance compared
with various indexes or other mutual funds; (iii) published evaluations by
nationally recognized ranking services and financial publications; (iv) updates
concerning its strategies and portfolio investments; (v) its goals, risk factors
and expenses compared with other mutual funds; (vi) analysis of its investments
by industry, country, credit quality and other characteristics; (vii) a
discussion of the risk/return continuum relating to different investments;
(viii) the potential impact of adding foreign stocks to a domestic portfolio;
(ix) the general biography or work experience of the portfolio managers of the
Funds; (x) portfolio manager commentary or market updates; (xi) discussion of
macroeconomic factors affecting the Fund and its investments; and (xii) other
information of interest to investors.

INDEPENDENT ACCOUNTANTS AND COUNSEL

Deloitte & Touche LLP, with principal offices at Two World Financial
Center, New York, New York 10281-1414, serves as the independent accountant for
the Trust. The statements of assets and liabilities of each Fund, as of [
], 1998, that appear in this Statement of Additional Information have been
audited by Deloitte & Touche LLP, whose report thereon appears elsewhere herein
and has been included herein in reliance upon the report of such firm of
independent accountants given upon their authority as experts in accounting and
auditing.

Willkie Farr & Gallagher serves as counsel for the Trust, as well as
counsel to CDC Investments.

FINANCIAL STATEMENTS

Each Fund's financial statement follows the Report of Independent
Accountants.

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APPENDIX

DESCRIPTION OF RATINGS

Commercial Paper Ratings
- ------------------------

Commercial paper rated A-1 by Standard and Poor's Ratings Services
("S&P") indicates that the degree of safety regarding timely payment is strong.
Those issues determined to possess extremely strong safety characteristics are
denoted with a plus sign designation. Capacity for timely payment on commercial
paper rated A-2 is satisfactory, but the relative degree of safety is not as
high as for issues designated A-1.

The rating Prime-1 is the highest commercial paper rating assigned by
Moody's Investors Service, Inc. ("Moody's"). Issuers rated Prime-1 (or related
supporting institutions) are considered to have a superior capacity for
repayment of short-term promissory obligations. Issuers rated Prime-2 (or
related supporting institutions) are considered to have a strong capacity for
repayment of short-term promissory obligations. This will normally be evidenced
by many of the characteristics of issuers rated Prime-1 but to a lesser degree.
Earnings trends and coverage ratios, while sound, will be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternative liquidity is maintained.

Corporate Bond Ratings
- ----------------------

The following summarizes the ratings used by S&P for corporate bonds:

AAA - This is the highest rating assigned by S&P to a debt obligation
and indicates an extremely strong capacity to pay interest and repay principal.

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

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

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

BB, B and CCC - Debt rated BB and B are regarded, on balance, as
predominately speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB represents a lower
degree of speculation than B, and CCC the highest degree of speculation. While
such bonds will likely have some quality

<PAGE>

and protective characteristics, these are outweighed by large uncertainties or
major risk exposures to adverse conditions.

BB - Debt rated BB has less near-term vulnerability to default than
other speculative issues. However, it faces major ongoing uncertainties or
exposure to adverse business, financial, or economic conditions, which could
lead to inadequate capacity to meet timely interest and principal payments. The
BB rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied BBB rating.

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

CCC - Debt rated CCC has a currently identifiable vulnerability to
default and is dependent upon favorable business, financial and economic
conditions to meet timely payment of interest and repayment of principal. In
the event of adverse business, financial or economic conditions, it is not
likely to have the capacity to pay interest and repay principal. The CCC rating
category is also used for debt subordinated to senior debt that is assigned an
actual or implied B or B- rating.

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

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

Additionally, the rating CI is reserved for income bonds on which no
interest is being paid. Such debt is rated between debt rated C and debt rated
D.

To provide more detailed indications of credit quality, the ratings
may be modified by the addition of a plus or minus sign to show relative
standing within this major rating category.

D - Debt rated D is in payment default. The D rating category is used
when interest payments or principal payments are not made on the date due even
if the applicable grace period has not expired, unless S&P believes that such
payments will be made during such grace period. The D rating also will be used
upon the filing of a bankruptcy petition if debt service payments are
jeopardized.

The following summarizes the ratings used by Moody's for corporate
bonds:

Aaa - Bonds that are rated Aaa are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally referred to
as "gilt edged." Interest

A-2
<PAGE>

payments are protected by a large or exceptionally stable margin and principal
is secure. While the various protective elements are likely to change, such
changes as can be visualized are most unlikely to impair the fundamentally
strong position of such issues.

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

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

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

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

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

Moody's applies numerical modifiers (1, 2 and 3) with respect to the
bonds rated "Aa" through "B." The modifier 1 indicates that the bond being
rated ranks in the higher end of its generic rating category; the modifier 2
indicates a mid-range ranking; and the modifier 3 indicates that the bond ranks
in the lower end of its generic rating category.

Caa - Bonds that are rated Caa are of poor standing. These issues may
be in default or present elements of danger may exist with respect to principal
or interest.

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

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

A-3

<PAGE>

PART C

OTHER INFORMATION
-----------------

Item 23. Exhibits
--------

Exhibit No. Description of Exhibit
- ----------- ----------------------
<S> <C>

(a) (1) Certificate of Trust.

(2) Trust Instrument.

(b) By-Laws.

(d) Form of Investment Advisory Agreement with CDC
Investment Management Corporation.*

(e) Form of Distribution Agreement with [ ].*

(f) Not applicable.

(g) Form of Custodian Agreement with [ ].*

(h) (1) Form of Transfer Agency and Service Agreement with [ ].*

(2) Form of Administration Agreement with [ ]*

(i) (1) Opinion and Consent of Willkie Farr & Gallagher, counsel to Registrant.*

(2) Opinion and Consent of Richards, Layton & Finger, Delaware counsel to Registrant.*

(j) Consent of Deloitte & Touche LLP Independent Accountants.*

(k) Not applicable.

(l) Purchase Agreement.*

(m) (1) Shareholder Servicing and Distribution Plan.*

(2) Distribution Plan.*

(3) Distribution Agreement.*

(n) Not applicable.

(o) 18f-3 Plan.*
</TABLE>

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

C-1

<PAGE>

Item 24. Persons Controlled by or Under Common Control
with Registrant
---------------------------------------------

All of the outstanding shares of common stock of Registrant on the
date Registrant's Registration Statement becomes effective will be owned by
CDC Investment Management Corporation, which will have contributed
Registrant's initial seed capital.

It is anticipated that shortly after the Trust's Registration Statement
becomes effective, CIMCO Holdings LLC ("CIMCO"), a Delaware Limited liability
company, will invest approximately $25 million in each Fund. Master Holdings,
a Cayman Islands corporation, is the majority shareholder of CIMCO and CDC
Investments is a minority shareholder of CIMCO. CDC Group, Paris is the
majority shareholder of Master Holdings. CDC Investments is a wholly-owned
subsidiary of CDC Group, Paris.

Item 25. Indemnification
---------------

Under Article X of the Trust Instrument (the "Instrument"), the
Trustees and officers of Registrant shall not have any liability to Registrant
or its stockholders for money damages, to the fullest extent permitted by
Delaware law. This limitation on liability applies to events occurring at the
time a person serves as a Trustee or officer of Registrant whether or not such
person is a Trustee or officer at the time of any proceeding in which liability
is asserted. No provision of Article X shall protect or purport to protect any
Trustee or officer of Registrant against any liability to Registrant or its
stockholders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office. Registrant shall indemnify and advance
expenses to its currently acting and its former Trustee to the fullest extent
that indemnification of Trustees and advancement of expenses to Directors is
permitted by Delaware law.

Registrant shall indemnify and advance expenses to its officers to the
same extent as its Trustees and to such further extent as is consistent with
such law.

Article X of the Instrument and Article VIII of the Bylaws authorize
Registrant to obtain insurance on behalf of its Trustees, officers and
employees, including any such person who was serving at the request of the
Registrant as a Trustee, officer or employee of a corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
and claimed by such person in such capacity, whether or not Registrant would
have the power to indemnify such person against such liability. Registrant may
not, however, obtain insurance that protects or purports to protect any Trustee,
officer or employee against any liability to Registrant or its Shareholders to
which he would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in the conduct of
his office.

Additionally, with respect to indemnification against liability
incurred by Registrant's distributor, reference is made to the form of
Distribution Agreement filed herewith. With respect to indemnification against
liability incurred by Registrant's investment manager, reference is made to the
form of Investment Advisory Agreement filed herewith.

C-2

<PAGE>

Item 26. Business and Other Connections of Investment Adviser
----------------------------------------------------

Registrant is managed by CDC Investment Management Corporation ("CDC
Investments"). CDC Investments is an established leader in providing alternative
investment strategies for institutional clients. CDC Investments currently has
approximately $3 billion in assets under management and provides asset
management services to large European, Asian and North American financial
institutions, family offices, fund of funds, pension funds and other investors.
The list required by this Item 26 of officers and directors of CDC Investments
together with information as to their other businesses, professions, vocations
or employment of a substantial nature during the past two years is incorporated
by reference to Schedules A and D of Form ADV filed by CDC Investments (SEC File
No. 801-42137) pursuant to the Advisers Act.

Item 27. Principal Underwriter
---------------------

(a) [ ] serves as distributor for Registrant, as well as for [ ].

(b) The information required by this Item 27 relating to each director,
officer or partner of [ ] is incorporated by reference to Schedule A of
Form BD filed by [ ] (SEC File No. ) pursuant to the Securities Exchange
Act of 1934.

Item 28. Location of Accounts and Records
--------------------------------

(1) CDC Investment Management Corporation
9 West 57th Street, 35th Floor
New York, New York 10019
(records relating to its functions as investment adviser;
Registrant's Certificate of Trust, Trust Instrument, By-laws
and minute books)

(2) [ ]

(records relating to its functions as administrator)

(3) [ ]

(records relating to its functions as distributor)

(4) [ ]

(records relating to its functions as custodian)

C-3

<PAGE>

(5) [ ]

(records relating to its functions as transfer agent)

Item 29. Management Services
-------------------

Not applicable.

Item 30. Undertakings
------------

Not applicable.

C-4

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended,
and the Investment Company Act of 1940, as amended, the Registrant has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York and the State of
New York, on this 27th day of October, 1998.

CDC MPT+ FUNDS

By: /s/Bluford H. Putnam
----------------------------------
Bluford H. Putnam
President and Chief Investment
Officer

Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the date indicated:

Signature Title Date
- --------- ----- ----
<S> <C> <C>

/s/Bluford H. Putnam President and Chief October 27, 1998
- -------------------- Investment Officer
Bluford H. Putnam

/s/C. Peter Paterno Treasurer October 27, 1998
- -------------------
C. Peter Paterno

/s/Rachel D. Manney Initial Trustee and October 27, 1998
- ------------------- Secretary
Rachel D. Manney
</TABLE>

<PAGE>

INDEX TO EXHIBITS
-----------------

Exhibit No. Description of Exhibit
- ----------- ----------------------
<S> <C>

(a)(1) Certificate of Trust
(2) Trust Instrument

(b) By-laws
</TABLE>

<PAGE>

CERTIFICATE OF TRUST

This Certificate of Trust of CDC MPT+ Funds (the "Trust"), dated
October 8, 1998, is being duly executed and filed by Rachel D. Manney, as sole
initial trustee of the Trust, to form a business trust under the laws of the
State of Delaware.

1. Name. The name of the business trust formed hereby is CDC MPT+
Funds.

2. Registered Office. The address of the Trust's registered office
in the State of Delaware is c/o The Corporation Trust Company, Corporation Trust
Center, 1209 Orange Street, City of Wilmington, New Castle County, DE 19801.

3. Registered Agent. The name of the Trust's registered agent at
the above listed address is The Corporation Trust Company.

4. Effective Date. This Certificate of Trust shall be effective
upon the date and time of filing.

5. Series Trust. Notice is hereby given that pursuant to Section
3804 of the Delaware Business Trust Act, the debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series of the Trust shall be enforceable against the assets of such
series only and not against the assets of the Trust generally.

6. Investment Company. The Trust is, or will become prior to or
within 180 days following the first issuance of shares of beneficial interests
therein, a registered investment company under the Investment Company Act of
1940, as amended.

IN WITNESS WHEREOF, the undersigned, being the sole Trustee of the
Trust, has executed this Certificate of Trust as of the date first above
written.

/s/ Rachel D. Manney
-------------------------------
Rachel D. Manney
as Trustee and not individually

<PAGE>

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

CDC MPT+ FUNDS

TRUST INSTRUMENT

DATED October 8, 1998

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

<PAGE>

TABLE OF CONTENTS
<TABLE>
<CAPTION>

Page
----
<S> <C>
ARTICLE I. NAME AND DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . .1

SECTION 1.1. NAME. . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
SECTION 1.2. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . .1

ARTICLE II. BENEFICIAL INTEREST. . . . . . . . . . . . . . . . . . . . . . . .2

SECTION 2.1. SHARES OF BENEFICIAL INTEREST . . . . . . . . . . . . . . . .2
SECTION 2.2. ISSUANCE OF SHARES. . . . . . . . . . . . . . . . . . . . . .2
SECTION 2.3. REGISTER OF SHARES AND SHARE CERTIFICATES . . . . . . . . . .3
SECTION 2.4. TRANSFER OF SHARES. . . . . . . . . . . . . . . . . . . . . .3
SECTION 2.5. TREASURY SHARES . . . . . . . . . . . . . . . . . . . . . . .3
SECTION 2.6. ESTABLISHMENT OF SERIES . . . . . . . . . . . . . . . . . . .3
SECTION 2.7. INVESTMENT IN THE TRUST . . . . . . . . . . . . . . . . . . .4
SECTION 2.8. ASSETS AND LIABILITIES OF SERIES. . . . . . . . . . . . . . .5
SECTION 2.9. NO PREEMPTIVE RIGHTS. . . . . . . . . . . . . . . . . . . . .6
SECTION 2.10. STATUS OF SHARES; NO PERSONAL LIABILITY OF
SHAREHOLDER. . . . . . . . . . . . . . . . . . . . . . . .6

ARTICLE III. THE TRUSTEES. . . . . . . . . . . . . . . . . . . . . . . . . . .6

SECTION 3.1. MANAGEMENT OF THE TRUST . . . . . . . . . . . . . . . . . . .6
SECTION 3.2. INITIAL TRUSTEE . . . . . . . . . . . . . . . . . . . . . . .7
SECTION 3.3. TERM OF OFFICE. . . . . . . . . . . . . . . . . . . . . . . .7
SECTION 3.4. VACANCIES AND APPOINTMENTS. . . . . . . . . . . . . . . . . .7
SECTION 3.5. TEMPORARY ABSENCE . . . . . . . . . . . . . . . . . . . . . .8
SECTION 3.6. NUMBER OF TRUSTEES. . . . . . . . . . . . . . . . . . . . . .8
SECTION 3.7. EFFECT OF ENDING OF A TRUSTEE'S SERVICE . . . . . . . . . . .8
SECTION 3.8. OWNERSHIP OF ASSETS OF THE TRUST. . . . . . . . . . . . . . .8

ARTICLE IV. POWERS OF THE TRUSTEES . . . . . . . . . . . . . . . . . . . . . .9

SECTION 4.1. POWERS. . . . . . . . . . . . . . . . . . . . . . . . . . . .9
SECTION 4.2. ISSUANCE AND REPURCHASE OF SHARES . . . . . . . . . . . . . 13
SECTION 4.3. TRUSTEES AND OFFICERS AS SHAREHOLDERS . . . . . . . . . . . 13
SECTION 4.4. ACTION BY THE TRUSTEES. . . . . . . . . . . . . . . . . . . 13
SECTION 4.5. CHAIRMAN OF THE BOARD OF TRUSTEES . . . . . . . . . . . . . 14
SECTION 4.6. PRINCIPAL TRANSACTIONS. . . . . . . . . . . . . . . . . . . 14

ARTICLE V. EXPENSES OF THE TRUST . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE VI. INVESTMENT ADVISER, PRINCIPAL UNDERWRITER, ADMINISTRATOR
AND TRANSFER AGENT . . . . . . . . . . . . . . . . . . . . . 15

SECTION 6.1. INVESTMENT ADVISER. . . . . . . . . . . . . . . . . . . . . 15
SECTION 6.2. PRINCIPAL UNDERWRITER . . . . . . . . . . . . . . . . . . . 15
SECTION 6.3. ADMINISTRATION. . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 6.4. TRANSFER AGENT. . . . . . . . . . . . . . . . . . . . . . . 16

i
<PAGE>

SECTION 6.5. PARTIES TO CONTRACT . . . . . . . . . . . . . . . . . . . . 16
SECTION 6.6. PROVISIONS AND AMENDMENTS . . . . . . . . . . . . . . . . . 17

ARTICLE VII. SHAREHOLDERS' VOTING POWERS AND MEETINGS. . . . . . . . . . . . 17

SECTION 7.1. VOTING POWERS . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 7.2. MEETINGS. . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 7.3. QUORUM AND REQUIRED VOTE. . . . . . . . . . . . . . . . . . 18

ARTICLE VIII. CUSTODIAN. . . . . . . . . . . . . . . . . . . . . . . . . . . 19

SECTION 8.1. APPOINTMENT AND DUTIES. . . . . . . . . . . . . . . . . . . 19
SECTION 8.2. CENTRAL CERTIFICATE SYSTEM. . . . . . . . . . . . . . . . . 20

ARTICLE IX. DISTRIBUTIONS AND REDEMPTIONS. . . . . . . . . . . . . . . . . . 20

SECTION 9.1. DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 9.2. REDEMPTIONS . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 9.3. DETERMINATION OF NET ASSET VALUE AND VALUATION OF
PORTFOLIO ASSETS . . . . . . . . . . . . . . . . . . . . 21
SECTION 9.4. SUSPENSION OF THE RIGHT OF REDEMPTION . . . . . . . . . . . 22
SECTION 9.5. REDEMPTION OF SHARES IN ORDER TO QUALIFY AS
REGULATED INVESTMENT COMPANY . . . . . . . . . . . . . . 22

ARTICLE X. LIMITATION OF LIABILITY AND INDEMNIFICATION . . . . . . . . . . . 23

SECTION 10.1. LIMITATION OF LIABILITY. . . . . . . . . . . . . . . . . . 23
SECTION 10.2. INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . 23
SECTION 10.3. SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . 25

ARTICLE XI. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . 25

SECTION 11.1. TRUST NOT A PARTNERSHIP. . . . . . . . . . . . . . . . . . 25
SECTION 11.2. TRUSTEE'S GOOD FAITH ACTION, EXPERT ADVICE, NO
BOND OR SURETY . . . . . . . . . . . . . . . . . . . . . 26
SECTION 11.3. ESTABLISHMENT OF RECORD DATES. . . . . . . . . . . . . . . 26
SECTION 11.4. TERMINATION OF TRUST . . . . . . . . . . . . . . . . . . . 26
SECTION 11.5. REORGANIZATION . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 11.6. FILING OF COPIES, REFERENCES, HEADINGS . . . . . . . . . . 28
SECTION 11.7. APPLICABLE LAW . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 11.8. AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 11.9. FISCAL YEAR. . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 11.10. PROVISIONS IN CONFLICT WITH LAW . . . . . . . . . . . . . 30

</TABLE>

ii
<PAGE>

CDC MPT+ FUNDS

October 8, 1998

TRUST INSTRUMENT, made by Rachel D. Manney as sole initial trustee.

WHEREAS, the Trustees desire to establish a business trust for the
investment and reinvestment of funds contributed thereto;

NOW THEREFORE, the Trustees declare that all money and property
contributed to the trust hereunder shall be held and managed in trust under this
Trust Instrument as herein set forth below.

ARTICLE I.
NAME AND DEFINITIONS

SECTION 1.1. NAME. The name of the trust created hereby is "CDC MPT+
Funds".

SECTION 1.2. DEFINITIONS. Wherever used herein, unless otherwise
required by the context or specifically provided:

(a) The "1940 Act" means the Investment Company Act of 1940, as
amended. Whenever reference is made hereunder to the 1940 Act, such reference
shall be interpreted as including any applicable order or orders of the
Commission or any rules or regulations adopted by the Commission thereunder or
interpretive releases of the Commission staff;

(b) "Bylaws" means the Bylaws of the Trust as adopted by the
Trustees, as amended from time to time;

(c) "Commission" has the meaning given it in the 1940 Act. In
addition, "Affiliated Person," "Assignment," "Interested Person" and "Principal
Underwriter" shall have the respective meanings given them in the 1940 Act.
"Majority Shareholder Vote" shall have the same meaning as the term "vote of a
majority of the outstanding voting securities" under the 1940 Act;

(d) "Delaware Act" refers to Chapter 38 of Title 12 of the Delaware
Code entitled "Treatment of Delaware Business Trusts," as amended from time to
time;

(e) "Net Asset Value" means the net asset value of each Series of
the Trust determined in the manner provided in Article IX, Section 9.3 hereof;

(f) "Outstanding Shares" means those Shares shown from time to time
in the books of the Trust or its transfer agent as then issued and outstanding,
but shall not include Shares which

<PAGE>

have been redeemed or repurchased by the Trust and which are at the time held in
the treasury of the Trust;

(g) "Series" means a series of Shares of the Trust established in
accordance with the provisions of Article II, Section 2.6 hereof;

(h) "Shareholder" means a record owner of Outstanding Shares of the
Trust;

(i) "Shares" means the equal proportionate transferable units of
beneficial interest into which the beneficial interest of each Series of the
Trust or class thereof shall be divided and may include fractions of Shares as
well as whole Shares;

(j) The "Trust" means CDC MPT+ Funds, a Delaware business trust,
and reference to the Trust when applicable to one or more Series of the Trust,
shall refer to any such Series;

(k) The "Trustee" or "Trustees" means the person or persons who has
or have signed this Trust Instrument so long as he or they shall continue in
office in accordance with the terms hereof and all other persons who may from
time to time be duly qualified and serving as Trustees in accordance with the
provisions of Article III hereof, and reference herein to a Trustee or to the
Trustees shall refer to the individual Trustees in their respective capacity as
Trustees hereunder;

(l) "Trust Property" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the account of one or
more of the Trust or any Series, or the Trustees on behalf of the Trust or any
Series.

ARTICLE II.
BENEFICIAL INTEREST

SECTION 2.1. SHARES OF BENEFICIAL INTEREST. The beneficial interest
in the Trust shall be divided into such Shares of one or more separate and
distinct Series or classes of a Series as set forth in Section 2.6 or as the
Trustees shall otherwise from time to time create and establish as provided in
Section 2.6. The number of Shares of each Series and class thereof authorized
hereunder is unlimited. All Shares issued hereunder, including without
limitation, Shares issued in connection with a dividend paid in Shares or a
split of Shares, shall be fully paid and non-assessable.

SECTION 2.2. ISSUANCE OF SHARES. The Trustees in their discretion
may, from time to time, without a vote of the Shareholders, issue Shares, in
addition to the then issued and outstanding Shares and Shares held in the
treasury, to such party or parties and for such amount and type of
consideration, subject to applicable law, including cash or securities, at such
time or

2
<PAGE>

times and on such terms as the Trustees may deem appropriate, and may in such
manner acquire other assets (including the acquisition of assets subject to, and
in connection with, the assumption of liabilities) and businesses. In
connection with any issuance of Shares, the Trustees may issue fractional Shares
and Shares held in the treasury. The Trustees may from time to time divide or
combine the Shares into a greater or lesser number without thereby changing the
proportionate beneficial interests in the Trust. Contributions to the Trust may
be accepted for, and Shares shall be redeemed as, whole Shares and/or 1/1000th
of a Share or integral multiples thereof. The Trustees or any person the
Trustees may authorize for the purpose may, in their discretion, reject any
application for the issuance of shares.

SECTION 2.3. REGISTER OF SHARES AND SHARE CERTIFICATES. A register
shall be kept at the principal office of the Trust or an office of the Trust's
transfer agent which shall contain the names and addresses of the Shareholders
of each Series, the number of Shares of that Series (or any class or classes
thereof) held by them respectively and a record of all transfers thereof. No
share certificates shall be issued by the Trust except as the Trustees may
otherwise authorize, and the persons indicated as shareholders in such register
shall be entitled to receive dividends or other distributions or otherwise to
exercise or enjoy the rights of Shareholders. No Shareholder shall be entitled
to receive payment of any dividend or other distribution, nor to have notice
given to him as herein or in the Bylaws provided, until he has given his address
to the transfer agent or such officer or other agent of the Trustees as shall
keep the said register for entry thereon.

SECTION 2.4. TRANSFER OF SHARES. Except as otherwise provided by the
Trustees, Shares shall be transferable on the records of the Trust only by the
record holder thereof or by his agent thereunto duly authorized in writing, upon
delivery to the Trustees or the Trust's transfer agent of a duly executed
instrument of transfer and such evidence of the genuineness of such execution
and authorization and of such other matters as may be required by the Trustees.
Upon such delivery the transfer shall be recorded on the register of the Trust.
Until such record is made, the Shareholder of record shall be deemed to be the
holder of such Shares for all purposes hereunder and neither the Trustees nor
the Trust, nor any transfer agent or registrar nor any officer, employee or
agent of the Trust shall be affected by any notice of the proposed transfer.

SECTION 2.5. TREASURY SHARES. Shares held in the treasury shall,
until reissued pursuant to Section 2.2 hereof, not confer any voting rights on
the Trustees, nor shall such Shares be entitled to any dividends or other
distributions declared with respect to the Shares.

SECTION 2.6. ESTABLISHMENT OF SERIES. The Trust created hereby shall
consist initially of three Series: U.S. Core

3
<PAGE>

Equity Fund; Aggressive Equity Fund and Global Independence Fund. Distinct
records shall be maintained by the Trust for each Series and the assets
associated with each Series shall be held and accounted for separately from the
assets of the Trust or any other Series. The Trustees shall have full power and
authority, in their sole discretion and without obtaining any prior
authorization or vote of the Shareholders of any Series, to establish and
designate and to change in any manner any Series or any classes of initial or
additional Series and to fix such preferences, voting powers, rights and
privileges of such Series or classes thereof as the Trustees may from time to
time determine, to divide or combine the Shares or any Series or classes thereof
into a greater or lesser number, to classify or reclassify any issued Shares or
any Series or classes thereof into one or more Series or classes of Shares, and
to take such other action with respect to the Shares as the Trustees may deem
desirable. The establishment and designation of any Series (other than those
established pursuant to the first sentence of this Section 2.6) shall be
effective upon the adoption of a resolution by a majority of the Trustees
setting forth such establishment and designation and the relative rights and
preferences of the Shares of such Series. A Series may issue any number of
Shares, but need not issue Shares. At any time that there are no Shares
outstanding of any particular Series previously established and designated, the
Trustees may by a majority vote abolish that Series and the establishment and
designation thereof.

All references to Shares in this Trust Instrument shall be deemed to
be Shares of any or all Series, or classes thereof as the context may require.
All provisions herein relating to the Trust shall apply equally to each Series
of the Trust, and each class thereof, except as the context otherwise requires.

Each Share of a Series of the Trust shall represent an equal
beneficial interest in the net assets of such Series. Each holder of Shares of
a Series shall be entitled to receive his proportionate share of all
distributions made with respect to such Series, based upon the number of full
and fractional Shares of the Series held. Upon redemption of his Shares, such
Shareholder shall be paid solely out of the funds and property of such Series of
the Trust.

SECTION 2.7. INVESTMENT IN THE TRUST. The Trustees shall accept
investments in any Series from such persons and on such terms as they may from
time to time authorize. At the Trustees' discretion, such investments, subject
to applicable law, may be in the form of cash or securities in which the
affected Series is authorized to invest, valued as provided in Article IX
Section 9.3. Investments in a Series shall be credited to each Shareholder's
account in the form of full and fractional Shares at the net asset value per
Share next determined after the investment is received or accepted as may be
determined by the Trustees; provided, however, that the Trustees

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may, in their sole discretion, (a) fix minimum amounts for initial and
subsequent investments or (b) impose a sales charge upon investments in such
manner and at such time determined by the Trustees.

SECTION 2.8. ASSETS AND LIABILITIES OF SERIES. All consideration
received by the Trust for the issue or sale of Shares of a particular Series,
together with all assets in which such consideration is invested or reinvested,
all income, earnings, profits, and proceeds thereof (including any proceeds
derived from the sale, exchange or liquidation of such assets, and any funds or
payments derived from any reinvestment of such proceeds in whatever form the
same may be), shall be held and accounted for separately from the other assets
of the Trust and of every other Series and may be referred to herein as "assets
belonging to" that Series. The assets belonging to a particular Series shall
belong to that Series for all purposes, and to no other Series, and shall be
subject only to the rights of creditors of that Series. In addition, any
assets, income, earnings, profits or funds, or payments and proceeds with
respect thereto, which are not readily identifiable as belonging to any
particular Series shall be allocated by the Trustees between and among one or
more of the Series in such manner as the Trustees, in their sole discretion,
deem fair and equitable. Each such allocation shall be conclusive and binding
upon the Shareholders of all Series for all purposes, and such assets, income,
earnings, profits or funds, or payments and proceeds with respect thereto shall
be assets belonging to that Series. The assets belonging to a particular Series
shall be so recorded upon the books of the Trust, and shall be held by the
Trustees in trust for the benefit of the holders of Shares of that Series. The
assets belonging to each particular Series shall be charged with the liabilities
of that Series and all expenses, costs, charges and reserves attributable to
that Series. Any general liabilities, expenses, costs, charges or reserves of
the Trust which are not readily identifiable as belonging to any particular
Series shall be allocated and charged by the Trustees between or among any one
or more of the Series in such manner as the Trustees in their sole discretion
deem fair nd equitable. Each such allocation shall be conclusive and binding
upon the Shareholders of all Series for all purposes without limitation of the
foregoing provisions of this Section 2.8, but subject to the right of the
Trustees in their discretion to allocate general liabilities, expenses, costs,
changes or reserves as herein provided, the debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular Series shall be enforceable against the assets of such Series only,
and not against the assets of the Trust generally. Notice of this contractual
limitation on inter-Series liabilities may, in the Trustee's sole discretion, be
set forth in the certificate of trust of the Trust (whether originally or by
amendment) as filed or to be filed in the Office of the Secretary of State of
the State of Delaware pursuant to the Delaware Act, and upon the giving of such
notice in the certificate of trust,

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the statutory provisions of Section 3804 of the Delaware Act relating to
limitations on inter-Series liabilities (and the statutory effect under Section
3804 of setting forth such notice in the certificate of trust) shall become
applicable to the Trust and each Series. Any person extending credit to,
contracting with or having any claim against any Series may look only to the
assets of that Series to satisfy or enforce any debt, with respect to that
Series. No Shareholder or former Shareholder of any Series shall have a claim
on or any right to any assets allocated or belonging to any other Series.

SECTION 2.9. NO PREEMPTIVE RIGHTS. Shareholders shall have no
preemptive or other right to subscribe to any additional Shares or other
securities issued by the Trust or the Trustees, whether of the same or other
Series.

SECTION 2.10. STATUS OF SHARES; NO PERSONAL LIABILITY OF SHAREHOLDER.
Shares shall be deemed to be personal property giving Shareholders only the
rights provided in this Trust Instrument. Every Shareholder, by virtue of
having acquired a Share, shall be held expressly to have assented to and agreed
to be bound by the terms of this Trust Instrument and to have become a party
hereto. No Shareholder shall be personally liable for the debts, liabilities,
obligations and expenses incurred by, contracted for, or otherwise existing with
respect to, the Trust or any Series. Neither the Trust nor the Trustees shall
have any power to bind any Shareholder personally or to demand payment from any
Shareholder for anything, other than as agreed by the Shareholder. Shareholders
shall have the same limitation of personal liability as is extended to
shareholders of a private corporation for profit incorporated in the State of
Delaware. Every written obligation of the Trust or any Series shall contain a
statement to the effect that such obligation may only be enforced against the
assets of the Trust or such Series; however, the omission of such statement
shall not operate to bind or create personal liability for any Shareholder or
Trustee.

ARTICLE III.
THE TRUSTEES

SECTION 3.1. MANAGEMENT OF THE TRUST. The Trustees shall have
exclusive and absolute control over the Trust Property and over the business of
the Trust to the same extent as if the Trustees were the sole owners of the
Trust Property and business in their own right, but with such powers of
delegation as may be permitted by this Trust Instrument. The Trustees shall
have power to conduct the business of the Trust and carry on its operations in
any and all of its branches and maintain offices both within and without the
State of Delaware, in any and all states of the United States of America, in the
District of Columbia, in any and all commonwealths, territories, dependencies,
colonies, or possessions of the United States of America, and in any foreign
jurisdiction and to do all such other things and execute all such instruments as
they deem necessary,

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<PAGE>

proper or desirable in order to promote the interests of the Trust although such
things are not herein specifically mentioned. Any determination as to what is
in the interests of the Trust made by the Trustees in good faith shall be
conclusive. In construing the provisions of this Trust Instrument, the
presumption shall be in favor of a grant of power to the Trustees.

The enumeration of any specific power in this Trust Instrument shall
not be construed as limiting the aforesaid power. The powers of the Trustees
may be exercised without order of or resort to any court.

Except for the Trustees named herein or appointed to fill vacancies
pursuant to Section 3.4 of this Article III, the Trustees shall be elected by
the Shareholders owning of record a plurality of the Shares voting at a meeting
of Shareholders. Any Shareholder meeting held for such purpose shall be held on
a date fixed by the Trustees. In the event that less than a majority of the
Trustees holding office have been elected by Shareholders, the Trustees then in
office will call a Shareholders' meeting for the election of Trustees in
accordance with the provisions of the 1940 Act.

SECTION 3.2. INITIAL TRUSTEE. The initial Trustee shall be the
person named herein.

SECTION 3.3. TERM OF OFFICE. The Trustees shall hold office during
the lifetime of this Trust, and until its termination as herein provided; except
(a) that any Trustee may resign his trust by written instrument signed by him
and delivered to the other Trustees, which shall take effect upon such delivery
or upon such later date as is specified therein; (b) that any Trustee may be
removed at any time by written instrument, signed by at least two-thirds of the
number of Trustees prior to such removal specifying the date when such removal
shall become effective; (c) that any Trustee who requests in writing to be
retired or who has died, becomes physically or mentally incapacitated by reason
of illness or otherwise, or is otherwise unable to serve, may be retired by
written instrument signed by a majority of the other Trustees, specifying the
date of his retirement; and (d) that a Trustee may be removed at any meeting of
the Shareholders of the Trust by a vote of Shareholders owning at least
two-thirds of the Outstanding Shares of the Trust.

SECTION 3.4. VACANCIES AND APPOINTMENTS. In case of a Trustee's
declination to serve, death, resignation, retirement, removal, physical or
mental incapacity by reason of illness, disease or otherwise, or if a Trustee is
otherwise unable to serve, or if there is an increase in the number of Trustees,
a vacancy shall occur. Whenever a vacancy in the Board of Trustees shall occur,
until such vacancy is filled, the other Trustees shall have all the powers
hereunder and the certificate of the

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<PAGE>

other Trustees of such vacancy shall be conclusive. In the case of a vacancy,
the remaining Trustees shall fill such vacancy by appointing such other person
as they in their discretion see fit, to the extent consistent with the
limitations provided under the 1940 Act. Such appointment shall be evidenced by
a written instrument signed by a majority of the Trustees in office or by
resolution of the Trustees, duly adopted, which shall be recorded in the minutes
of a meeting of the Trustees, whereupon the appointment shall take effect.

An appointment of a Trustee may be made by the Trustees then in office
in anticipation of a vacancy to occur by reason of retirement, resignation or
increase in number of Trustees effective at a later date, provided that said
appointment shall become effective only at or after the effective date of said
retirement, resignation or increase in number of Trustees. As soon as any
person appointed as a Trustee pursuant to this Section 3.4 shall have accepted
this Trust, and such person shall be deemed a Trustee.

SECTION 3.5. TEMPORARY ABSENCE. Any Trustee may, by power of
attorney, delegate his power for a period not exceeding six months at any time,
unless otherwise extended for one or more additional consecutive six (6) month
periods, to any other Trustee or Trustees, provided that in no case shall fewer
than two Trustees personally exercise the other powers hereunder except as
herein otherwise expressly provided.

SECTION 3.6. NUMBER OF TRUSTEES. The number of Trustees (other than
the Initial Trustee) shall be at least two (2), and thereafter shall be such
number as shall be fixed from time to time by a majority of the Trustees,
provided, however, that the number of Trustees shall in no event be more than
twelve (12).

SECTION 3.7. EFFECT OF ENDING OF A TRUSTEE'S SERVICE. The
declination to serve, death, resignation, retirement, removal, incapacity, or
inability of the Trustees, or any one of them, shall not operate to terminate
the Trust or to revoke any existing agency created pursuant to the terms of this
Trust Instrument.

SECTION 3.8. OWNERSHIP OF ASSETS OF THE TRUST. The assets of the
Trust and of each Series shall be held separate and apart from any assets now or
hereafter held in any capacity other than as Trustee hereunder by the Trustees
or any successor Trustees. Legal title in all of the assets of the Trust and
the right to conduct any business shall at all times be considered as vested in
the Trust, except that the Trustees may cause legal title to any Trust Property
to be held by, or in the name of, one or more of the Grantees acting for and on
behalf of the Trust or in the name of any person as nominee. No Shareholder
shall be deemed to have a severable ownership in any individual asset of the
Trust or of any Series or any right of partition or

8
<PAGE>

possession thereof but each Shareholder shall have, except as otherwise provided
for herein, a proportionate undivided beneficial interest in the Trust or Series
based upon the number of Shares owned. The Shares shall be personal property
giving only the rights specifically set forth in this Trust Instrument.

ARTICLE IV.
POWERS OF THE TRUSTEES

SECTION 4.1. POWERS. The Trustees in all instances shall act as
principals, and are and shall be free from the control of the Shareholders. The
Trustees shall have full power and authority to do any and all acts and to make
and execute any and all contracts and instruments that they may consider
necessary or appropriate in connection with the management of the Trust. The
Trustees shall not in any way be bound or limited by present or future laws or
customs in regard to trust investments, but shall have full authority and power
to make any and all investments which they, in their sole discretion, shall deem
proper to accomplish the purpose of this Trust without recourse to any court or
other authority. Subject to any applicable limitation in this Trust Instrument
or the Bylaws of the Trust, the Trustees shall have the power and authority:

(a) To invest and reinvest cash and other property (including
investment, notwithstanding any other provision hereof, of all of the assets of
any Series in a single open-end investment company, including investment by
means of transfer of such assets in exchange for an interest or interests in
such investment company), and to hold cash or other property of the Trust
uninvested, without in any event being bound or limited by any present or future
law or custom in regard to investments by trustees, and to sell, exchange, lend,
pledge, mortgage, hypothecate, write options on and lease any or all of the
assets of the Trust;

(b) To operate as and carry on the business of an investment
company, and exercise all the powers necessary and appropriate to the conduct of
such operations;

(c) To borrow money and in this connection issue notes or other
evidence of indebtedness; to secure borrowings by mortgaging, pledging or
otherwise subjecting as security the Trust Property; to endorse, guarantee, or
undertake the performance of an obligation or engagement of any other person and
to lend Trust Property;

(d) To provide for the distribution of interests of the Trust
either through a Principal Underwriter in the manner hereinafter provided for or
by the Trust itself, or both, or otherwise pursuant to a plan of distribution of
any kind;

(e) To adopt Bylaws not inconsistent with this Trust Instrument
providing for the conduct of the business of the Trust

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<PAGE>

and to amend and repeal them to the extent that they do not reserve that right
to the Shareholders; such Bylaws shall be deemed incorporated and included in
this Trust Instrument;

(f) To elect and remove such officers and appoint and terminate
such agents as they consider appropriate;

(g) To employ one or more banks, trust companies or companies that
are members of a national securities exchange or such other entities as the
Commission may permit as custodians of any assets of the Trust subject to any
conditions set forth in this Trust Instrument or in the Bylaws;

(h) To retain one or more transfer agents and shareholder servicing
agents, or both;

(i) To set record dates in the manner provided herein or in the
Bylaws;

(j) To delegate such authority as they consider desirable to any
officers of the Trust and to any investment adviser, manager, custodian,
underwriter or other agent or independent contractor in accordance with the
provisions of the 1940 Act;

(k) To sell or exchange any or all of the assets of the Trust,
subject to the provisions of Article XI, subsection 11.4(b) hereof;

(l) To vote or give assent, or exercise any rights of ownership,
with respect to stock or other securities or property, and to execute and
deliver powers of attorney to such person or persons as the Trustees shall deem
proper, granting to such person or persons such power and discretion with
relation to securities or property as the Trustees shall deem proper;

(m) To exercise powers and rights of subscription or otherwise
which in any manner arise out of ownership of securities;

(n) To hold any security or property in a form not indicating any
trust, whether in bearer, book entry, unregistered or other negotiable form; or
either in the name of the Trust or in the name of a custodian or a nominee or
nominees, subject in either case to proper safeguards according to the usual
practice of Delaware business trusts or investment companies;

(o) To establish separate and distinct Series with separately
defined investment objectives and policies and distinct investment purposes in
accordance with the provisions of Article II hereof and to establish classes of
such Series having relative rights, powers and duties as they may provide
consistent with applicable law;

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<PAGE>

(p) To the full extent permitted by Section 3804 of the Delaware
Act, to allocate assets, liabilities and expenses of the Trust to a particular
Series or to apportion the same between or among two or more Series, provided
that any liabilities or expenses incurred by a particular Series shall be
payable solely out of the assets belonging to that Series as provided for in
Article II hereof;

(q) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or concern, any
security of which is held in the Trust; to consent to any contract, lease,
mortgage, purchase, or sale of property by such corporation or concern, and to
pay calls or subscriptions with respect to any security held in the Trust;

(r) To compromise, arbitrate, or otherwise adjust claims in favor
of or against the Trust or any matter in controversy including, but not limited
to, claims for taxes;

(s) To make distributions of income and of capital gains to
Shareholders in the manner provided herein;

(t) To establish, from time to time, minimum investments for
Shareholders in the Trust or in one or more Series or class, and to require the
redemption of the Shares of any Shareholders whose investment is less than such
minimums upon giving notice to such Shareholder;

(u) To establish one or more committees, to delegate any of the
powers of the Trustees to said committees and to adopt a committee charter
providing for such responsibilities, membership (including Trustees, officers or
other agents of the Trust therein) and any other characteristics of said
committees as the Trustees may deem proper. Notwithstanding the provisions of
this Article IV, and in addition to such provisions or any other provision of
this Trust Instrument or of the Bylaws, the Trustees may by resolution appoint a
committee consisting of less than the whole number of Trustees then in office,
which committee may be empowered to act for and bind the Trustees and the Trust,
as if the acts of such committee were the acts of all the Trustees then in
office, with respect to the institution, prosecution, dismissal, settlement,
review or investigation of any action, suit or proceeding which shall be pending
or threatened to be brought before any court, administrative agency or other
adjudicatory body;

(v) To interpret the investment policies, practices or limitations
of any Series;

(w) To establish a registered office and have a registered agent in
the State of Delaware;

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<PAGE>

(x) to compromise, arbitrate or otherwise adjust claims in favor of
or against the Trust or any matter in controversy, including but not limited to,
claims for taxes;

(y) to purchase and pay for entirely out of the Trust Estate such
insurance as the Trustees may deem necessary or appropriate for the conduct of
the business, including without limitation, insurance policies insuring the
assets of the Trust or payment of distributions and principal on its portfolio
investments, subject to applicable law, and any restrictions set forth in the
by-laws, insurance policies insuring the Shareholders, Trustees, Officers,
Employees, Agents, Investment Advisors, Principal Underwriters, or Independent
Contractors of the Trust, individually, against all claims and liabilities of
every nature arising by reason of holding Shares, holding, being or having held
any such office or position, or by reason of any action alleged to have been
taken or omitted by any such Person as Trustee, Officer, Employee, Agent,
Investment Advisor, Principal Underwriter, or Independent Contractor including
any action taken or omitted that may be determined to constitute negligence,
whether or not the Trust would have the power to indemnify such Person against
liability;

(z) to enter into contracts of any kind and description;

(aa) to take any other action that may be taken by a board of
directors of a business corporation organized under the laws of the State of
Delaware; and

(bb) In general to carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything necessary, suitable
or proper for the accomplishment of any purpose or the attainment of any object
or the furtherance of any power hereinbefore set forth, either alone or in
association with others, and to do every other act or thing incidental or
appurtenant to or growing out of or connected with the aforesaid business or
purposes, objects or powers.

The foregoing clauses shall be construed as objects and powers, and
the foregoing enumeration of specific powers shall not be held to limit or
restrict in any manner the general powers of the Trustees. Any action by one or
more of the Trustees in their capacity as such hereunder shall be deemed an
action on behalf of the Trust or the applicable Series, and not an action in an
individual capacity.

The Trustees shall not be limited to investing in obligations maturing
before the possible termination of the Trust.

No one dealing with the Trustees shall be under any obligation to make
any inquiry concerning the authority of the

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<PAGE>

Trustees, or to see the application of any payments made or property transferred
to the Trustees or upon their order.

SECTION 4.2. ISSUANCE AND REPURCHASE OF SHARES. The Trustees shall
have the power to issue, sell, repurchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of and otherwise deal in Shares and, subject to
the provisions set forth in Article II and Article IX, to apply to any such
repurchase, redemption, retirement, cancellation or acquisition of Shares any
funds or property of the Trust, or the particular Series of the Trust, with
respect to which such Shares are issued.

SECTION 4.3. TRUSTEES AND OFFICERS AS SHAREHOLDERS. Any Trustee,
officer or other agent of the Trust may acquire, own and dispose of Shares to
the same extent as if he were not a Trustee, officer or agent; and the Trustees
may issue and sell or cause to be issued and sold Shares to and buy such Shares
from any such person or any firm or company in which he is interested, subject
only to the general limitations herein contained as to the sale and purchase of
such Shares; and all subject to any restrictions which may be contained in the
Bylaws.

SECTION 4.4. ACTION BY THE TRUSTEES. In any action taken by the
Trustees hereunder, unless otherwise specified herein or under the 1940 Act, the
Trustees shall act by majority vote at a meeting duly called or by unanimous
written consent without a meeting or by telephone meeting provided a quorum of
Trustees participate in any such telephone meeting, unless the 1940 Act requires
that a particular action be taken only at a meeting at which the Trustees are
present in person. At any meeting of the Trustees, a majority of the Trustees
shall constitute a quorum. Meetings of the Trustees may be called orally or in
writing by the Chairman of the Board of Trustees or by any two other Trustees.
Notice of the time, date and place of all meetings of the Trustees shall be
given by the person calling the meeting to each Trustee by telephone, facsimile
or other electronic mechanism sent to his home or business address at least
twenty-four hours in advance of the meeting or by written notice mailed to his
home or business address at least seventy-two hours in advance of the meeting.
Notice need not be given to any Trustee who attends the meeting without
objecting to the lack of notice or who executes a written waiver of notice with
respect to the meeting. Any meeting conducted by telephone shall be deemed to
take place at the principal office of the Trust, as determined by the Bylaws or
by the Trustees. Subject to the requirements of the 1940 Act, the Trustees by
majority vote may delegate to any one or more of their number their authority to
approve particular matters or take particular actions on behalf of the Trust.
Written consents or waivers of the Trustees may be executed in one or more
counterparts. Execution of a written consent or waiver and delivery thereof to
the Trust may be accomplished by facsimile or other similar electronic
mechanism.

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<PAGE>

SECTION 4.5. CHAIRMAN OF THE BOARD OF TRUSTEES. The Trustees shall
appoint one of their number to be Chairman of the Board of Trustees. The
Chairman shall preside at all meetings of the Trustees, shall be responsible for
the execution of policies established by the Trustees and the administration of
the Trust, and may be (but is not required to be) the chief executive, financial
and/or accounting officer of the Trust.

SECTION 4.6. PRINCIPAL TRANSACTIONS. Except to the extent prohibited
by applicable law, the Trustees may, on behalf of the Trust, buy any securities
from or sell any securities to, or lend any assets of the Trust to, any Trustee
or officer of the Trust or any firm of which any such Trustee or officer is a
member acting as principal, or have any such dealings with any investment
adviser, administrator, distributor or transfer agent for the Trust or with any
interested person of such person; and the Trust may employ any such person, or
firm or company in which such person is an interested person, as broker, legal
counsel, registrar, investment adviser, administrator, distributor, transfer
agent, dividend disbursing agent, custodian or in any other capacity upon
customary terms.

ARTICLE V.
EXPENSES OF THE TRUST

Subject to the provisions of Article II, Section 2.8, the Trustees
shall be reimbursed from the Trust estate or the assets belonging to the
appropriate Series for their expenses and disbursements, including, without
limitation, interest charges, taxes, brokerage fees and commissions; expenses of
issue, repurchase and redemption of Shares; certain insurance premiums;
applicable fees, interest charges and expenses of third parties, including the
Trust's investment advisers, managers, administrators, distributors, custodians,
transfer agent and fund accountant; fees of pricing, interest, dividend, credit
and other reporting services; costs of membership in trade associations;
telecommunications expenses; funds transmission expenses; auditing, legal and
compliance expenses; costs of forming the Trust and maintaining its existence;
costs of preparing and printing the Trust's prospectuses, statements of
additional information and shareholder reports and delivering them to existing
Shareholders; expenses of meetings of Shareholders and proxy solicitations
therefor; costs of maintaining books and accounts; costs of reproduction,
stationery and supplies; fees and expenses of the Trustees; compensation of the
Trust's officers and employees and costs of other personnel performing services
for the Trust; costs of Trustee meetings, including travel expenses; Commission
registration fees and related expenses; state or foreign securities laws
registration fees and related expenses and for such non-recurring items as may
arise, including litigation to which the Trust (or a Trustee acting as such) is
a party, and for all losses and liabilities by them incurred in administering
the Trust, and for the payment of such expenses, disbursements, losses and
liabilities the Trustees

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<PAGE>

shall have a lien on the assets belonging to the appropriate Series, or in the
case of an expense allocable to more than one Series, on the assets of each such
Series, prior to any rights or interests of the Shareholders thereto. This
section shall not preclude the Trust from directly paying any of the
aforementioned fees and expenses.

ARTICLE VI.
INVESTMENT ADVISER, PRINCIPAL UNDERWRITER,
ADMINISTRATOR AND TRANSFER AGENT

SECTION 6.1. INVESTMENT ADVISER.

(a) The Trustees may in their discretion, from time to time, enter
into an investment advisory contract or contracts with respect to the Trust or
any Series whereby the other party or parties to such contract or contracts
shall undertake to furnish the Trustees with such investment advisory,
statistical and research facilities and services and such other facilities and
services, if any, all upon such terms and conditions (including any Shareholder
vote) that may be required under the 1940 Act, as may be prescribed in the
Bylaws, or as the Trustees may in their discretion determine (such terms and
conditions not to be inconsistent with the provisions of this Trust Instrument
or of the Bylaws). Notwithstanding any other provision of this Trust
Instrument, the Trustees may authorize any investment adviser (subject to such
general or specific instructions as the Trustees may from time to time adopt) to
effect purchases, sales or exchanges of portfolio securities, other investment
instruments of the Trust, or other Trust Property on behalf of the Trustees, or
may authorize any officer, agent, or Trustee to effect such purchases, sales or
exchanges pursuant to recommendations of the investment adviser (and all without
further action by the Trustees). Any such purchases, sales and exchanges shall
be deemed to have been authorized by all of the Trustees.

(b) The Trustees may authorize the investment adviser to employ, from
time to time, one or more sub-advisers to perform such of the acts and services
of the investment adviser, and upon such terms and conditions, as may be agreed
upon between the investment adviser and sub-adviser (such terms and conditions
not to be inconsistent with the provisions of this Trust Instrument or of the
Bylaws). Any reference in this Trust Instrument to the investment adviser shall
be deemed to include such sub-advisers, unless the context otherwise requires;
provided that no Shareholder approval shall be required with respect to any
sub-adviser unless required under the 1940 Act or other law, contract or order
applicable to the Trust.

SECTION 6.2. PRINCIPAL UNDERWRITER. The Trustees may in their
discretion from time to time enter into an exclusive or non-exclusive
underwriting contract or contracts providing for the sale of Shares, whereby the
Trust may either agree to sell

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<PAGE>

Shares to the other party to the contract or appoint such other party its sales
agent for such Shares. In either case, the contract shall be on such terms and
conditions as may be prescribed in the Bylaws and as the Trustees may in their
discretion determine (such terms and conditions not to be inconsistent with the
provisions of this Trust Instrument or of the Bylaws); and such contract may
also provide for the repurchase or sale of Shares by such other party as
principal or as agent of the Trust.

SECTION 6.3. ADMINISTRATION. The Trustees may in their discretion
from time to time enter into one or more management or administrative contracts
whereby the other party or parties shall undertake to furnish the Trustees with
management or administrative services. The contract or contracts shall be on
such terms and conditions as may be prescribed in the Bylaws and as the Trustees
may in their discretion determine (such terms and conditions not to be
inconsistent with the provisions of this Trust Instrument or of the Bylaws).

SECTION 6.4. TRANSFER AGENT. The Trustees may in their discretion
from time to time enter into one or more transfer agency and shareholder service
contracts whereby the other party or parties shall undertake to furnish the
Trustees with transfer agency and shareholder services. The contract or
contracts shall be on such terms and conditions as may be prescribed in the
Bylaws and as the Trustees may in their discretion determine (such terms and
conditions not to be inconsistent with the provisions of this Trust Instrument
or of the Bylaws).

SECTION 6.5. PARTIES TO CONTRACT. Any contract of the character
described in Sections 6.1, 6.2, 6.3 and 6.4 of this Article VI or any contract
of the character described in Article VIII hereof may be entered into with any
corporation, firm, partnership, trust or association, although one or more of
the Trustees or officers of the Trust may be an officer, director, trustee,
shareholder, or member of such other party to the contract, and no such contract
shall be invalidated or rendered void or voidable by reason of the existence of
any relationship, nor shall any person holding such relationship be disqualified
from voting on or executing the same in his capacity as Shareholder and/or
Trustee, nor shall any person holding such relationship be liable merely by
reason of such relationship for any loss or expense to the Trust under or by
reason of said contract or accountable for any profit realized directly or
indirectly therefrom, provided that the contract when entered into was not
inconsistent with the provisions of this Article VI or Article VIII hereof or of
the Bylaws. The same person (including a corporation, firm, partnership, trust,
or association) may be the other party to contracts entered into pursuant to
Sections 6.1, 6.2, 6.3 and 6.4 of this Article VI or pursuant to Article VIII
hereof and any individual may be financially interested or otherwise affiliated
with persons who

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are parties to any or all of the contracts mentioned in this Section 6.5.

SECTION 6.6. PROVISIONS AND AMENDMENTS. Any contract entered into
pursuant to Section 6.1 or 6.2 of this Article VI shall be consistent with and
subject to the requirements of Section 15 of the 1940 Act, if applicable, or
other applicable Act of Congress hereafter enacted with respect to its
continuance in effect, its termination, and the method of authorization and
approval of such contract or renewal thereof, and no amendment to any contract
entered into pursuant to Section 6.1 or 6.2 of this Article VI shall be
effective unless assented to in a manner consistent with the requirements of
said Section 15, as modified by any applicable rule, regulation or order of the
Commission.

ARTICLE VII.
SHAREHOLDERS' VOTING POWERS AND MEETINGS

SECTION 7.1. VOTING POWERS.

(a) The Shareholders shall have power to vote only (a) for the
election of Trustees to the extent provided in Article III, Section 3.1 hereof,
(b) for the removal of Trustees to the extent provided in Article III, Section
3.3(d) hereof, (c) with respect to any investment advisory contract to the
extent provided in Article VI, Section 6.1 hereof, (d) with respect to an
amendment of this Trust Instrument, to the extent provided in Article XI,
Section 11.8, and (e) with respect to such additional matters relating to the
Trust as may be required by law, by this Trust Instrument, or any registration
of the Trust with the Commission or any State, or as the Trustees may consider
desirable.

(b) Notwithstanding paragraph (a) of this Section 7.1 or any other
provision of this Trust Instrument (including the Bylaws) which would by its
terms provide for or require a vote of Shareholders, the Trustees may take
action without a Shareholder vote if (i) the Trustees shall have obtained an
opinion of counsel that a vote or approval of such action by Shareholders is not
required under (A) the 1940 Act or any other applicable laws, or (B) any
registrations, undertakings or agreements of the Trust known to such counsel,
and the taking of such action without a Shareholder vote would be consistent
with the best interests of the Shareholders.

(c) On any matter submitted to a vote of the Shareholders, all
Shares shall be voted in the aggregate and not by individual Series, except that
whenever the Trustees determine that the matter affects only certain Series,
such matter may be submitted for a vote by only such Series, except (i) when
required by the 1940 Act, Shares shall be voted in the aggregate and not by
individual Series; and (ii) when the Trustees have determined that the matter
affects the interests of more than one Series and that voting by shareholders of
all Series would be

17
<PAGE>

consistent with the 1940 Act, then the Shareholders of all such Series shall be
entitled to vote thereon (either by individual Series or by Shares voted in the
aggregate, as the Trustees in their discretion may determine). Each whole Share
shall be entitled to one vote as to any matter on which it is entitled to vote,
and each fractional Share shall be entitled to a proportionate fractional vote.
There shall be no cumulative voting in the election of Trustees. Shares may be
voted in person or by proxy or in any manner provided for in the Bylaws. A
proxy may be given in writing. The Bylaws may provide that proxies may also, or
may instead, be given by any electronic or telecommunications device or in any
other manner. Notwithstanding anything else herein or in the Bylaws, in the
event a proposal by anyone other than the officers or Trustees of the Trust is
submitted to a vote of the Shareholders, or in the event of any proxy contest or
proxy solicitation or proposal in opposition to any proposal by the officers or
Trustees of the Trust, Shares may be voted only in person or by written proxy.
Until Shares are issued, the Trustees may exercise all rights of Shareholders
and may take any action required or permitted by law, this Trust Instrument or
any of the Bylaws of the Trust to be taken by Shareholders.

SECTION 7.2. MEETINGS. Meetings may be held within or without the
State of Delaware. Special meetings of the Shareholders of any Series may be
called by the Trustees and shall be called by the Trustees upon the written
request of Shareholders owning at least one tenth of the Outstanding Shares of
the Trust entitled to vote. Whenever ten or more Shareholders meeting the
qualifications set forth in Section 16(c) of the 1940 Act seek the opportunity
of furnishing materials to the other Shareholders with a view to obtaining
signatures on such a request for a meeting, the Trustees shall comply with the
provisions of said Section 16(c) with respect to providing such Shareholders
access to the list of the Shareholders of record of the Trust or the mailing of
such materials to such Shareholders of record, subject to any rights provided to
the Trust or any Trustees provided by said Section 16(c). Notice shall be sent,
by First Class Mail or such other means determined by the Trustees, at least 10
days prior to any such meeting. Notwithstanding anything to the contrary in
this Section 7.2, the Trustees shall not be required to call a special meeting
of the Shareholders of any Series or to provide Shareholders seeking the
opportunity of furnishing the materials to other Shareholders with a view to
obtaining signatures on a request for a meeting except to the extent required
under the 1940 Act.

SECTION 7.3. QUORUM AND REQUIRED VOTE. One-third of Shares
outstanding and entitled to vote in person or by proxy as of the record date for
a Shareholders' meeting shall be a quorum for the transaction of business at
such Shareholders' meeting, except that where any provision of law or of this
Trust Instrument permits or requires that holders of any Series shall vote as a
Series (or that holders of a class shall vote as a

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<PAGE>

class), then one-third of the aggregate number of Shares of that Series (or that
class) entitled to vote shall be necessary to constitute a quorum for the
transaction of business by that Series (or that class). Any meeting of
Shareholders may be adjourned from time to time by a majority of the votes
properly cast upon the question of adjourning a meeting to another date and
time, whether or not a quorum is present. Any adjourned session or sessions may
be held, within a reasonable time after the date set for the original meeting,
without the necessity of further notice. Except when a larger vote is required
by law or by any provision of this Trust Instrument or the Bylaws, a majority of
the Shares voted in person or by proxy shall decide any questions and a
plurality shall elect a Trustee, provided that where any provision of law or of
this Trust Instrument permits or requires that the holders of any Series shall
vote as a Series (or that the holders of any class shall vote as a class), then
a majority of the Shares present in person or by proxy of that Series (or
class), voted on the matter in person or by proxy shall decide that matter
insofar as that Series (or class) is concerned. Shareholders may act by
unanimous written consent, to the extent not inconsistent with the 1940 Act, and
any such actions taken by a Series (or class) may be consented to unanimously in
writing by Shareholders of that Series (or class).

ARTICLE VIII.
CUSTODIAN

SECTION 8.1. APPOINTMENT AND DUTIES. The Trustees shall employ a
bank, a company that is a member of a national securities exchange, or a trust
company, that in each case shall have capital, surplus and undivided profits of
at least twenty million dollars ($20,000,000) and that is a member of the
Depository Trust Company (or such other person or entity as may be permitted to
act as custodian of the Trust's assets under the 1940 Act) as custodian with
authority as its agent, but subject to such restrictions, limitations and other
requirements, if any, as may be contained in the Bylaws of the Trust: (a) to
hold the securities owned by the Trust and deliver the same upon written order
or oral order confirmed in writing; (b) to receive and receipt for any moneys
due to the Trust and deposit the same in its own banking department or elsewhere
as the Trustees may direct; and (c) to disburse such funds upon orders or
vouchers.

The Trustees may also authorize the custodian to employ one or more
sub-custodians from time to time to perform such of the acts and services of the
custodian, and upon such terms and conditions, as may be agreed upon between the
custodian and such sub-custodian and approved by the Trustees, provided that in
every case such sub-custodian shall be a bank, a company that is a member of a
national securities exchange, or a trust company organized under the laws of the
United States or one of the states thereof and having capital, surplus and
undivided profits of at least twenty million dollars ($20,000,000) and that is a
member of the Depository Trust Company or such other person or

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<PAGE>

entity as may be permitted by the Commission or is otherwise able to act as
custodian of the Trust's assets in accordance with the 1940 Act.

SECTION 8.2. CENTRAL CERTIFICATE SYSTEM. Subject to the 1940 Act and
such other rules, regulations and orders as the Commission may adopt, the
Trustees may direct the custodian to deposit all or any part of the securities
owned by the Trust in a system for the central handling of securities
established by a national securities exchange or a national securities
association registered with the Commission under the Securities Exchange Act of
1934, or such other person as may be permitted by the Commission, or otherwise
in accordance with the 1940 Act, pursuant to which system all securities of any
particular class or series of any issuer deposited within the system are treated
as fungible and may be transferred or pledged by bookkeeping entry without
physical delivery of such securities, provided that all such deposits shall be
subject to withdrawal only upon the order of the Trust or its custodians,
sub-custodians or other agents.

ARTICLE IX.
DISTRIBUTIONS AND REDEMPTIONS

SECTION 9.1. DISTRIBUTIONS

(a) The Trustees may from time to time declare and pay dividends or
other distributions with respect to any Series and/or class of a Series. The
amount of such dividends or distributions and the payment of them and whether
they are in cash or any other Trust Property shall be wholly in the discretion
of the Trustees. All dividends and other distributions on Shares of a
particular Series shall be distributed pro rata to the Shareholders of that
Series in proportion to the number of Shares of that Series they held on the
record date established for such payment, except that such dividends and
distributions shall appropriately reflect expenses allocated to the Series.

(b) Dividends and other distributions may be paid or made to the
Shareholders of record at the time of declaring a dividend or other distribution
or among the Shareholders of record at such other date or time or dates or times
as the Trustees shall determine, which dividends or distributions, at the
election of the Trustees, may be paid pursuant to a standing resolution or
resolutions adopted only once or with such frequency as the Trustees may
determine. The Trustees may adopt and offer to Shareholders such dividend
reinvestment plans, cash dividend payout plans or related plans as the Trustees
shall deem appropriate.

(c) Anything in this Trust Instrument to the contrary
notwithstanding, the Trustees may at any time declare and distribute a stock
dividend to the Shareholders of a particular

20
<PAGE>

Series, or class thereof, as of the record date of that Series fixed as provided
in Section 11.3 hereof.

SECTION 9.2. REDEMPTIONS. In case any holder of record of Shares of
a particular Series desires to dispose of his Shares or any portion thereof he
may deposit at the office of the transfer agent or other authorized agent of
that Series a written request or such other form of request as the Trustees may
from time to time authorize, requesting that the Series purchase the Shares in
accordance with this Section 9.2; and, subject to Section 9.4 hereof, the
Shareholder so requesting shall be entitled to require the Series to purchase,
and the Series or the Principal Underwriter of the Series shall purchase his
said Shares, but only at the Net Asset Value thereof (as described in Section
9.3 of this Article IX). The Series shall make payment for any such Shares to
be redeemed, as aforesaid, in cash or property from the assets of that Series
and, subject to Section 9.4 hereof, payment for such Shares shall be made by the
Series or the Principal Underwriter of the Series to the Shareholder of record
within seven (7) days after the date upon which the request is effective. Upon
redemption, shares shall become Treasury shares and may be re-issued from time
to time.

SECTION 9.3. DETERMINATION OF NET ASSET VALUE AND VALUATION OF
PORTFOLIO ASSETS. The term "Net Asset Value" of any Series shall mean that
amount by which the assets of that Series exceed its liabilities, all as
determined by or under the direction of the Trustees. The Trustees may delegate
any of their powers and duties under this Section 9.3 with respect to valuation
of assets and liabilities. Such value shall be determined separately for each
Series and shall be determined on such days and at such times as the Trustees
may determine. Such determination shall be made with respect to securities and
other instruments for which market quotations are readily available, at the
market value of such securities or other instruments; and with respect to other
securities and assets, at the fair value as determined in good faith by the
Trustees; provided, however, that the Trustees, without Shareholder approval,
may alter the method of valuing portfolio securities or other instruments
insofar as permitted under the 1940 Act. The resulting amount, which shall
represent the total Net Asset Value of the particular Series, shall be divided
by the total number of shares of that Series outstanding at the time and the
quotient so obtained shall be the Net Asset Value per Share of that Series. At
any time the Trustees may cause the Net Asset Value per Share last determined to
be determined again in similar manner and may fix the time when such
redetermined value shall become effective.

The Trustees shall not be required to adopt, but may at any time
adopt, discontinue or amend a practice of seeking to maintain the Net Asset
Value per Share of the Series at a constant amount. If, for any reason, the net
income of any Series, determined at any time, is a negative amount, the Trustees
shall have the power with respect to that Series (a) to

21
<PAGE>

offset each Shareholder's pro rata share of such negative amount from the
accrued dividend account of such Shareholder, (b) to reduce the number of
Outstanding Shares of such Series by reducing the number of Shares in the
account of each Shareholder by a pro rata portion of that number of full and
fractional Shares which represents the amount of such excess negative net
income, (c) to cause to be recorded on the books of such Series an asset account
in the amount of such negative net income (provided that the same shall
thereupon become the property of such Series with respect to such Series and
shall not be paid to any Shareholder), which account may be reduced by the
amount of dividends declared thereafter upon the Outstanding Shares of such
Series on the day such negative net income is experienced, until such asset
account is reduced to zero; (d) to combine the methods described in clauses (a)
and (b) and (c) of this sentence; or (e) to take any other action they deem
appropriate, in order to cause (or in order to assist in causing) the Net Asset
Value per Share of such Series to remain at a constant amount per Outstanding
Share immediately after each such determination and declaration. The Trustees
shall also have the power not to declare a dividend out of net income for the
purpose of causing the Net Asset Value per Share to be increased.

In the event that any Series is divided into classes, the provisions
of this Section 9.3, to the extent applicable as determined in the discretion of
the Trustees and consistent with the 1940 Act and other applicable law, may be
equally applied to each such class.

SECTION 9.4. SUSPENSION OF THE RIGHT OF REDEMPTION. The Trustees may
declare a suspension of the right of redemption or postpone the date of payment
if permitted under the 1940 Act. Such suspension shall take effect at such time
as the Trustees shall specify but not later than the close of business on the
business day next following the declaration of suspension, and thereafter there
shall be no right of redemption or payment until the Trustees shall declare the
suspension at an end. In the case of a suspension of the right of redemption, a
Shareholder may either withdraw his request for redemption or receive payment
based on the Net Asset Value per Share next determined after the termination of
the suspension.

SECTION 9.5. REDEMPTION OF SHARES IN ORDER TO QUALIFY AS REGULATED
INVESTMENT COMPANY. If the Trustees shall, at any time and in good faith, be of
the opinion that direct or indirect ownership of Shares of any Series has or may
become concentrated in any Person to an extent which would disqualify any Series
as a regulated investment company under the Internal Revenue Code of 1986 as
amended, then the Trustees shall have the power (but not the obligation) by lot
or other means deemed equitable by them (a) to call for redemption by any such
person of a number, or principal amount, of Shares sufficient to maintain or
bring the direct or indirect ownership of Shares into conformity with the
requirements for such qualification and (b) to refuse to transfer

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<PAGE>

or issue Shares to any person whose acquisition of Shares in question would
result in such disqualification. The redemption shall be effected at the
redemption price and in the manner provided in this Article IX.

The holders of Shares shall upon demand disclose to the Trustees in
writing such information with respect to direct and indirect ownership of Shares
as the Trustees deem necessary to comply with the requirements of any taxing
authority or this Section 9.5.

ARTICLE X.
LIMITATION OF LIABILITY AND INDEMNIFICATION

SECTION 10.1. LIMITATION OF LIABILITY. Neither a Trustee nor an
officer of the Trust, when acting in such capacity, shall be personally liable
to any person other than the Trust or the Shareholders for any act, omission or
obligation of the Trust, any Trustee or any officer of the Trust. Neither a
Trustee nor an officer of the Trust shall be liable for any act or omission or
any conduct whatsoever in his capacity as Trustee or as an officer of the Trust,
provided that nothing contained herein or in the Delaware Act shall protect any
Trustee or any officer of the Trust against any liability to the Trust or to
Shareholders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of the office of Trustee or officer of the Trust
hereunder.

SECTION 10.2. INDEMNIFICATION.

(a) Subject to the exceptions and limitations contained in
Subsection 10.2(b):

(i) every person who is, or has been, a Trustee or officer of the
Trust (including any individual who serves at its request as Director,
Officer, Partner, Trustee or the like of another organization in which it
has any interest as a shareholder, creditor or otherwise), and such
Person's heirs, executors, administrators and other legal representatives
(hereinafter referred to as a "Covered Person") shall be indemnified by the
Trust or Series to the fullest extent permitted by law against liability
and against all expenses reasonably incurred or paid by him in connection
with any claim, action, suit or proceeding in which he becomes involved as
a party or otherwise by virtue of his being or having been a Covered Person
and against amounts paid or incurred by him in the settlement thereof; and

(ii) the words "claim," "action," "suit," or "proceeding" shall
apply to all claims, actions, suits or proceedings (civil, criminal or
other, including

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<PAGE>

appeals), actual or threatened while in office or thereafter, and the words
"liability" and "expenses" shall include, without limitation, attorneys'
fees, costs, judgments, amounts paid in settlement, fines, penalties and
other liabilities.

(b) No indemnification shall be provided hereunder to a Covered
Person:

(i) who shall have been adjudicated by a court or body before which
the proceeding was brought (A) to be liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross negligence
or reckless disregard of the duties involved in the conduct of his office
or (B) not to have acted in good faith in the reasonable belief that his
action was in the best interest of the Trust; or

(ii) in the event of a settlement, unless there has been a
determination that such Trustee or officer did not engage in willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office, (A) by the court or other
body approving the settlement; (B) by at least a majority of those Trustees
who are neither interested persons of the Trust nor are parties to the
matter based upon a review of readily available facts (as opposed to a full
trial-type inquiry); (C) by written opinion of independent legal counsel
based upon a review of readily available facts (as opposed to a full
trial-type inquiry) or (D) by a vote of a majority of the Outstanding
Shares entitled to vote (excluding any Outstanding Shares owned of record
or beneficially by such Covered Person).

(c) The rights of indemnification herein provided may be insured
against by policies maintained by the Trust, shall be severable, shall not be
exclusive of or affect any other rights to which any Covered Person may now or
hereafter be entitled, shall continue as to a person who has ceased to be a
Covered Person and shall inure to the benefit of the heirs, executors and
administrators of such a person. Nothing contained herein shall affect any
rights to indemnification to which Trust personnel, other than Covered Persons,
and other persons may be entitled by contract or otherwise under law.

(d) Expenses in connection with the preparation and presentation of
a defense to any claim, action, suit or proceeding of the character described in
Subsection (a) of this Section 10.2 may be paid by the Trust or Series from time
to time prior to final disposition thereof upon receipt of an undertaking by or
on behalf of such Covered Person that such amount will be paid over by him to
the Trust or Series if it is ultimately determined that he is not entitled to
indemnification under this

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<PAGE>

Section 10.2; provided, however, that either (i) such Covered Person shall have
provided appropriate security for such undertaking, (ii) the Trust is insured
against losses arising out of any such advance payments or (iii) either a
majority of the Trustees who are neither interested persons of the Trust nor
parties to the matter, or independent legal counsel in a written opinion, shall
have determined, based upon a review of readily available facts (as opposed to a
trial-type inquiry or full investigation), that there is reason to believe that
such Covered Person will be found entitled to indemnification under this Section
10.2.

(e) any repeal or modification of this Article X by the
Shareholders, or adoption or modification of any other provisions of this Trust
Instrument or By-laws inconsistent with this Article, shall be prospectively
only to the extent that such repeal or modification would, if applied
retrospectively, adversely affect any limitation on the liability of any Covered
Person or indemnification available to any Covered Person with respect to any
act or omission which occurred prior to such repeal, modification or adoption.

SECTION 10.3. SHAREHOLDERS. In case any Shareholder of any Series
shall be held to be personally liable solely by reason of his being or having
been a Shareholder of such Series and not because of his acts or omissions or
for some other reason, the Shareholder or former Shareholder (or his heirs,
executors, administrators or other legal representatives, or, in the case of a
corporation or other entity, its corporate or other general successor) shall be
entitled out of the assets belonging to the applicable Series to be held
harmless from and indemnified against all loss and expense arising from such
liability. The Trust, on behalf of the affected Series, shall, upon request by
the Shareholder, assume the defense of any claim made against the Shareholder
for any act or obligation of the Series and satisfy any judgment thereon from
the assets of the Series.

ARTICLE XI.
MISCELLANEOUS

SECTION 11.1. TRUST NOT A PARTNERSHIP. It is hereby expressly
declared that a trust and not a partnership is created hereby. No Trustee
hereunder shall have any power to bind personally either the Trust officers or
any Shareholder. All persons extending credit to, contracting with or having
any claim against the Trust or the Trustees shall look only to the assets of the
appropriate Series or (if the Trustees shall have yet to have established
Series) of the Trust for payment under such credit, contract or claim; and
neither the Shareholders nor the Trustees, nor any of their agents, whether
past, present or future, shall be personally liable therefor. Nothing in this
Trust Instrument shall protect a Trustee against any liability to which the
Trustee would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of

25
<PAGE>

the duties involved in the conduct of the office of Trustee hereunder.

SECTION 11.2. TRUSTEE'S GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR
SURETY. The exercise by the Trustees or the officers of the Trust of their
powers and discretion hereunder in good faith and with reasonable care under the
circumstances then prevailing shall be binding upon everyone interested.
Subject to the provisions of Article X hereof and to Section 11.1 of this
Article XI, the Trustees and the officers of the Trust shall not be liable for
errors of judgment or mistakes of fact or law. The Trustees and the officers of
the Trust may take advice of counsel or other experts with respect to the
meaning and operation of this Trust Instrument, and subject to the provisions of
Article X hereof and Section 11.1 of this Article XI, shall be under no
liability for any act or omission in accordance with such advice or for failing
to follow such advice. The Trustees and the officers of the Trust shall not be
required to give any bond as such, nor any surety if a bond is obtained.

SECTION 11.3. ESTABLISHMENT OF RECORD DATES. The Trustees may close
the Share transfer books of the Trust for a period not exceeding ninety (90)
days preceding the date of any meeting of Shareholders, or the date for the
payment of any dividends or other distributions, or the date for the allotment
of rights, or the date when any change or conversion or exchange of Shares shall
go into effect; or in lieu of closing the stock transfer books as aforesaid, the
Trustees may fix in advance a date, not exceeding ninety (90) days preceding the
date of any meeting of Shareholders, or the date for payment of any dividend or
other distribution, or the date for the allotment of rights, or the date when
any change or conversion or exchange of Shares shall go into effect, as a record
date for the determination of the Shareholders entitled to notice of, and to
vote at, any such meeting, or entitled to receive payment of any such dividend
or other distribution, or to any such allotment of rights, or to exercise the
rights in respect of any such change, conversion or exchange of Shares, and in
such case such Shareholders and only such Shareholders as shall be Shareholders
of record on the date so fixed shall be entitled to such notice of, and to vote
at, such meeting, or to receive payment of such dividend or other distribution,
or to receive such allotment or rights, or to exercise such rights, as the case
may be, notwithstanding any transfer of any Shares on the books of the Trust
after any such record date fixed as aforesaid.

SECTION 11.4. TERMINATION OF TRUST.

(a) This Trust shall continue without limitation of time but
subject to the provisions of Subsection 11.4(b).

(b) The Trustees may, subject to any necessary Shareholder,
Trustee, and regulatory approvals:

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<PAGE>

(i) sell and convey all or substantially all of the assets of the
Trust or any affected Series to another trust, partnership, association or
corporation, or to a separate series of shares thereof, organized under the
laws of any state which trust, partnership, association or corporation is
an open-end management investment company as defined in the 1940 Act, or is
a series thereof, for adequate consideration which may include the
assumption of all outstanding obligations, taxes and other liabilities,
accrued or contingent, of the Trust or any affected Series, and which may
include shares of beneficial interest, stock or other ownership interests
of such trust, partnership, association or corporation or of a series
thereof;

(ii) enter into a plan of liquidation in order to terminate and
liquidate any Series (or class) of the Trust, or the Trust; or

(iii) at any time sell and convert into money all of the assets of
the Trust or any affected Series.

Upon making reasonable provision, in the determination of the Trustees, for the
payment of all liabilities by assumption or otherwise, the Trustees shall
distribute the remaining proceeds or assets (as the case may be) of each Series
(or class) ratably among the holders of Shares of the affected Series, based
upon the ratio that each Shareholder's Shares bears to the number of Shares of
such Series (or class) then outstanding.

(c) Upon completion of the distribution of the remaining proceeds
or the remaining assets as provided in Subsection 11.4(b), the Trust or any
affected Series shall terminate and the Trustees and the Trust shall be
discharged of any and all further liabilities and duties hereunder and the
right, title and interest of all parties with respect to the Trust or Series
shall be canceled and discharged.

Upon termination of the Trust, following completion of winding up of
its business, the Trustees shall cause a certificate of cancellation of the
Trust's certificate of trust to be filed in accordance with the Delaware Act,
which certificate of cancellation may be signed by any one Trustee.

SECTION 11.5. REORGANIZATION.

(a) Notwithstanding anything else herein, the Trustees, in order to
change the form or jurisdiction of organization of the Trust, may (i) cause the
Trust to merge or consolidate with or into one or more trusts, partnerships
(general or limited), associations or corporations so long as the surviving or
resulting entity is an open-end management investment company under the 1940
Act, or is a series thereof, that will succeed to or assume the Trust's
registration under

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<PAGE>

that Act and which is formed, organized or existing under the laws of a state,
commonwealth, possession or colony of the United States or (ii) cause the Trust
to incorporate under the laws of Delaware.

(b) The Trustees may, subject to a vote of a majority of the
Trustees and any shareholder vote required under the 1940 Act, if any, cause the
Trust to merge or consolidate with or into one or more trusts, partnerships
(general or limited), associations, limited liability companies or corporations
formed, organized or existing under the laws of a state, commonwealth,
possession or colony of the United States.

(c) Any agreement of merger or consolidation or certificate of
merger or consolidation may be signed by a majority of Trustees and facsimile
signatures conveyed by electronic or telecommunication means shall be valid.

(d) Pursuant to and in accordance with the provisions of Section
3815(f) of the Delaware Act, and notwithstanding anything to the contrary
contained in this Trust Instrument, an agreement of merger or consolidation
approved by the Trustees in accordance with paragraph (a) or (b) of this Section
11.5 may effect any amendment to the Trust Instrument or effect the adoption of
a new trust instrument of the Trust if it is the surviving or resulting trust in
the merger or consolidation.

SECTION 11.6. FILING OF COPIES, REFERENCES, HEADINGS. The original
or a copy of this Trust Instrument and of each amendment hereof or Trust
Instrument supplemental hereto shall be kept at the office of the Trust where it
may be inspected by any Shareholder. Anyone dealing with the Trust may rely on
a certificate by an officer or Trustee of the Trust as to whether or not any
such amendments or supplements have been made and as to any matters in
connection with the Trust hereunder, and with the same effect as if it were the
original, may rely on a copy certified by an officer or Trustee of the Trust to
be a copy of this Trust Instrument or of any such amendment or supplemental
Trust Instrument. In this Trust Instrument or in any such amendment or
supplemental Trust Instrument, references to this Trust Instrument, and all
expressions such as "herein," "hereof" and "hereunder," shall be deemed to refer
to this Trust Instrument as amended or affected by any such supplemental Trust
Instrument. All expressions like "his," "the" and "him," shall be deemed to
include the feminine and neuter, as well as masculine, genders. Headings are
placed herein for convenience of reference only and in case of any conflict, the
text of this Trust Instrument, rather than the headings, shall control. This
Trust Instrument may be executed in any number of counterparts each of which
shall be deemed an original.

SECTION 11.7. APPLICABLE LAW. The trust set forth in this instrument
is made in the State of Delaware, and the Trust and this Trust Instrument, and
the rights and obligations of the

28
<PAGE>

Trustees and Shareholders hereunder, are to be governed by and construed and
administered according to the Delaware Act and the laws of said State; provided,
however, that there shall not be applicable to the Trust, the Trustees or this
Trust Instrument (unless separately required under the 1940 Act) (a) the
provisions of Section 3540 of Title 12 of the Delaware Code or (b) any
provisions of the laws (statutory or common) of the State of Delaware (other
than the Delaware Act) pertaining to trusts which relate to or regulate (i) the
filing with any court or governmental body or agency of trustee accounts or
schedules of trustee fees and charges, (ii) affirmative requirements to post
bonds for trustees, officers, agents or employees of a trust, (iii) the
necessity for obtaining court or other governmental approval concerning the
acquisition, holding or disposition of real or personal property, (iv) fees or
other sums payable to trustees, officers, agents or employees of a trust, (v)
the allocation of receipts and expenditures to income or principal, (vi)
restrictions or limitations on the permissible nature, amount or concentration
of trust investments or requirements relating to the titling, storage or other
manner of holding of trust assets, or (vii) the establishment of fiduciary or
other standards of responsibilities or limitations on the acts or powers of
trustees, which are inconsistent with the limitations or liabilities or
authorities and powers of the Trustees set forth or referenced in this Trust
Instrument. The Trust shall be of the type commonly called a "business trust,"
and without limiting the provisions hereof, the Trust may exercise all powers
which are ordinarily exercised by such a trust under Delaware law. The Trust
specifically reserves the right to exercise any of the powers or privileges
afforded to trusts or ctions that may be engaged in by trusts under the Delaware
Act, and the absence of a specific reference herein to any such power, privilege
or action shall not imply that the Trust may not exercise such power or
privilege or take such actions.

SECTION 11.8. AMENDMENTS. Except as specifically provided herein,
the Trustees may, without shareholder vote, amend or otherwise supplement this
Trust Instrument by making an amendment, a Trust Instrument supplemental hereto
or an amended and restated Trust Instrument. Shareholders shall have the right
to vote (a) on any amendment which would adversely affect their rights under
this Trust Instrument, (b) on any amendment to this Section 11.8, (c) on any
amendment as may be required by law or by the Trust's registration statement
filed with the Commission and (d) on any amendment submitted to them by the
Trustees. Any amendment required or permitted to be submitted to Shareholders
which, as the Trustees determine, shall affect the Shareholders of one or more
Series shall be authorized by vote of the Shareholders of each Series affected
and no vote of shareholders of a Series not affected shall be required.
Notwithstanding any other provision of this Trust Instrument, any amendment to
Article X hereof shall not limit the rights to indemnification or insurance
provided therein with respect to action or omission of Covered Persons prior to
such amendment.

29
<PAGE>

SECTION 11.9. FISCAL YEAR. The fiscal year of the Trust shall end on
a specified date as set forth in the Bylaws, provided, however, that the
Trustees may change the fiscal year of the Trust.

SECTION 11.10. PROVISIONS IN CONFLICT WITH LAW. The provisions of
this Trust Instrument are severable, and if the Trustees shall determine, with
the advice of counsel, that any of such provisions are in conflict with the 1940
Act, the regulated investment company provisions of the Internal Revenue Code of
1986, as amended, or with other applicable laws and regulations, the conflicting
provision shall be deemed never to have constituted a part of this Trust
Instrument; provided, however, that such determination shall not affect any of
the remaining provisions of this Trust Instrument or render invalid or improper
any action taken or omitted prior to such determination. If any provision of
this Trust Instrument shall be held invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall attach only to such
provision in such jurisdiction and shall not in any manner affect such provision
in any other jurisdiction or any other provision of this Trust Instrument in any
jurisdiction.

30
<PAGE>

IN WITNESS WHEREOF, the undersigned, being the sole initial Trustee of
the Trust, has executed this Instrument as of the date first written above.

/s/ Rachel D. Manney,
-----------------------------
Rachel D. Manney, as Trustee
and not individually

<PAGE>

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

BYLAWS OF

CDC MPT+ FUNDS

AS ADOPTED: OCTOBER 13, 1998

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

<PAGE>

TABLE OF CONTENTS

PAGE
<S> <C>
ARTICLE I. PRINCIPAL OFFICE. . . . . . . . . . . . . . . . . . . . . . . . . . 3

ARTICLE II. OFFICERS AND THEIR ELECTION. . . . . . . . . . . . . . . . . . . . 3
SECTION 2.1. OFFICERS. . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2.2. ELECTION OF OFFICERS. . . . . . . . . . . . . . . . . . . . 3
SECTION 2.3. RESIGNATIONS. . . . . . . . . . . . . . . . . . . . . . . . 3

ARTICLE III. POWERS AND DUTIES OF OFFICERS AND TRUSTEES. . . . . . . . . . . . 3
SECTION 3.1. MANAGEMENT OF THE TRUST . . . . . . . . . . . . . . . . . . 3
SECTION 3.2. EXECUTIVE AND OTHER COMMITTEES. . . . . . . . . . . . . . . 4
SECTION 3.3. COMPENSATION. . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 3.4. CHAIRMAN OF THE BOARD OF TRUSTEES . . . . . . . . . . . . . 4
SECTION 3.5. PRESIDENT . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 3.6. TREASURER . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.7. SECRETARY . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.8. VICE PRESIDENT. . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.9. ASSISTANT TREASURER . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.10. ASSISTANT SECRETARY. . . . . . . . . . . . . . . . . . . . 5
SECTION 3.11. SUBORDINATE OFFICERS . . . . . . . . . . . . . . . . . . . 6
SECTION 3.12. SURETY BONDS . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 3.13. REMOVAL. . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 3.14. REMUNERATION . . . . . . . . . . . . . . . . . . . . . . . 6

ARTICLE IV. SHAREHOLDERS' MEETINGS . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 4.1. SPECIAL MEETINGS. . . . . . . . . . . . . . . . . . . . . . 6
SECTION 4.2. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 4.3. VOTING PROXIES. . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 4.4. PLACE OF MEETING. . . . . . . . . . . . . . . . . . . . . . 8
SECTION 4.5. ACTION WITHOUT A MEETING. . . . . . . . . . . . . . . . . . 8

ARTICLE V. TRUSTEES' MEETINGS. . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 5.1. SPECIAL MEETINGS. . . . . . . . . . . . . . . . . . . . . . 8
SECTION 5.2. REGULAR MEETINGS. . . . . . . . . . . . . . . . . . . . . . 8
SECTION 5.3. QUORUM. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 5.4. NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 5.5. PLACE OF MEETING. . . . . . . . . . . . . . . . . . . . . . 9
SECTION 5.6. SPECIAL ACTION. . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 5.7. ACTION BY CONSENT . . . . . . . . . . . . . . . . . . . . . 9
SECTION 5.8. PARTICIPATION IN MEETINGS BY CONFERENCE TELEPHONE . . . . . 9

ARTICLE VI. FISCAL YEAR; REGISTERED OFFICE AND REGISTERED AGENT. . . . . . . . 9
SECTION 6.1. FISCAL YEAR . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 6.2. REGISTERED OFFICE AND REGISTERED AGENT. . . . . . . . . . .10

ARTICLE VII. INSPECTION OF BOOKS . . . . . . . . . . . . . . . . . . . . . . .10

ARTICLE VIII. INSURANCE OF OFFICERS, TRUSTEES, AND EMPLOYEES . . . . . . . . .10

<PAGE>

ARTICLE IX. SEAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

ARTICLE X. AMENDMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

ARTICLE XI. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . .11
SECTION 11.1. SEVERABILITY . . . . . . . . . . . . . . . . . . . . . . .11
SECTION 11.2. HEADINGS . . . . . . . . . . . . . . . . . . . . . . . . .11
</TABLE>

(2)
<PAGE>

These Bylaws of CDC MPT+ FUNDS (the "Trust"), a Delaware business
trust, are subject to the Trust Instrument of the Trust, dated October 8, 1998
as from time to time amended, supplemented or restated (the "Trust Instrument").
Capitalized terms used herein which are defined in the Trust Instrument are used
as therein defined.

ARTICLE I.
PRINCIPAL OFFICE

The principal office of the Trust shall be located in New York, New
York or such other location as the Trustees may, from time to time, determine.
The Trust may establish and maintain such other offices and places of business
as the Trustees may, from time to time, determine.

ARTICLE II.
OFFICERS AND THEIR ELECTION

SECTION 2.1. OFFICERS. The officers of the Trust shall be a
President, a Treasurer, a Secretary, and such other officers as the Trustees may
from time to time elect. The Trustees may delegate to any officer or committee
the power to appoint any subordinate officers or agents. It shall not be
necessary for any Trustee or other officer to be a holder of Shares in the
Trust.

SECTION 2.2. ELECTION OF OFFICERS. The Treasurer and Secretary shall
be chosen by the Trustees. The President shall be chosen by and from the
Trustees. Two or more offices may be held by a single person except the offices
of President and Secretary. Subject to the provisions of Section 3.13 hereof,
the President, the Treasurer and the Secretary shall each hold office until
their successors are chosen and qualified and all other officers shall hold
office at the pleasure of the Trustees.

SECTION 2.3. RESIGNATIONS. Any officer of the Trust may resign,
notwithstanding Section 2.2 hereof, by filing a written resignation with the
President, the Trustees or the Secretary, which resignation shall take effect on
being so filed or at such time as may be therein specified.

ARTICLE III.
POWERS AND DUTIES OF OFFICERS AND TRUSTEES

SECTION 3.1. MANAGEMENT OF THE TRUST. The business and affairs of
the Trust shall be managed by, or under the direction of, the Trustees, and they
shall have all powers necessary and desirable to carry out their
responsibilities, so far as such powers are not inconsistent with the laws of
the State of Delaware, the Trust Instrument or with these Bylaws.

(3)
<PAGE>

SECTION 3.2. EXECUTIVE AND OTHER COMMITTEES. The Trustees may elect
from their own number an executive committee, which shall have any or all of the
powers of the Board of Trustees while the Board of Trustees is not in session.
The Trustees may also elect from their own number other committees from time to
time, including an audit committee and a nominating committee. The number
composing such committees and the powers conferred upon the same are to be
determined by vote of a majority of the Trustees. All members of such
committees shall hold such offices at the pleasure of the Trustees, and the
Trustees may abolish any of the committees at any time. Any committee to which
the Trustees delegate any of their powers or duties shall keep records of its
meetings and shall report its actions to the Trustees. The Trustees shall have
power to rescind any action of any committee, but no such rescission shall have
retroactive effect. The Trustees shall have the power at any time to fill
vacancies in the committees. The Trustees may delegate to these committees any
of its powers, except the power to declare a dividend or distribution on Shares,
authorize the issuance of Shares, recommend to Shareholders any action requiring
Shareholder's approval, amend these Bylaws, approve any merger or Share
exchange, approve or terminate any contract with an Investment Adviser, Transfer
Agent, Custodian, or to take any other action required by applicable law to be
taken by the Trustees.

SECTION 3.3. COMPENSATION. Each Trustee and each committee member
may receive such compensation for his services and reimbursement for his
expenses as may be fixed from time to time by resolution of the Trustees.

SECTION 3.4. CHAIRMAN OF THE BOARD OF TRUSTEES. The Trustees may
appoint from among their number a Chairman who shall serve as such at the
pleasure of the Trustees. When present, he shall preside at all meetings of the
Shareholders and the Trustees, and he may, subject to the approval of the
Trustees, appoint a Trustee to preside at such meetings in his absence. He
shall perform such other duties as the Trustees may from time to time designate.

SECTION 3.5. PRESIDENT. The President shall be the chief executive
officer of the Trust and, subject to the direction of the Trustees, shall have
general administration of the business and policies of the Trust. In the
absence of the Chairman of the Trustees or if no Chairman of the Trustees has
been elected, the President shall preside at all Shareholders' meetings and at
all meetings of the Trustees and shall in general exercise the powers and
perform the duties of the Chairman of the Trustees. Except as the Trustees may
otherwise order, the President shall have the power to grant, issue, execute or
sign such powers of attorney, process, agreements or other documents as may be
deemed advisable or necessary in the furtherance of the interests of the Trust
or any Series thereof. He shall also have the power to employ attorneys,
accountants and other advisors and

(4)
<PAGE>

agents and counsel for the Trust. The President shall perform such duties
additional to all of the foregoing as the Trustees may from time to time
designate.

SECTION 3.6. TREASURER. The Treasurer shall be the principal
financial and accounting officer of the Trust. He shall deliver all funds and
securities of the Trust which may come into his hands to such company as the
Trustees shall employ as Custodian in accordance with the Trust Instrument and
applicable provisions of law. He shall make annual reports regarding the
business and condition of the Trust, which reports shall be preserved in Trust
records, and he shall furnish such other reports regarding the business and
condition of the Trust as the Trustees may from time to time require. The
Treasurer shall perform such additional duties as the Trustees may from time to
time designate.

SECTION 3.7. SECRETARY. The Secretary shall record in books kept for
the purpose all votes and proceedings of the Trustees and the Shareholders at
their respective meetings. He shall have the custody of the seal of the Trust.
The Secretary shall perform such additional duties as the Trustees may from time
to time designate.

SECTION 3.8. VICE PRESIDENT. Any Vice President of the Trust shall
perform such duties as the Trustees or the President may from time to time
designate. At the request or in the absence or disability of the President, the
Vice President (or, if there are two or more Vice Presidents, then the senior of
the Vice Presidents) present and able to act may perform all the duties of the
President and, when so acting, shall have all the powers of and be subject to
all the restrictions upon the President.

SECTION 3.9. ASSISTANT TREASURER. Any Assistant Treasurer of the
Trust shall perform such duties as the Trustees or the Treasurer may from time
to time designate, and, in the absence of the Treasurer, the senior Assistant
Treasurer, present and able to act, may perform all the duties of the Treasurer
and, when so acting, shall have all the powers of and be subject to all the
restrictions upon the Treasurer.

SECTION 3.10. ASSISTANT SECRETARY. Any Assistant Secretary of the
Trust shall perform such duties as the Trustees or the Secretary may from time
to time designate, and, in the absence of the Secretary, the senior Assistant
Secretary, present and able to act, may perform all the duties of the Secretary
and, when so acting, shall have all the powers of and be subject to all the
restrictions upon the Secretary.

SECTION 3.11. SUBORDINATE OFFICERS. The Trustees from time to time
may appoint such officers or agents as they may deem advisable, each of whom
shall have such title, hold office for such period, have such authority and
perform such duties as the

(5)
<PAGE>

Trustees may determine. The Trustees from time to time may delegate to one or
more officers or committees of Trustees the power to appoint any such
subordinate officers or agents and to prescribe their respective terms of
office, authorities and duties.

SECTION 3.12. SURETY BONDS. The Trustees may require any officer or
agent of the Trust to execute a bond (including, without limitation, any bond
required by the Investment Company Act of 1940, as amended (the "1940 Act") and
the rules and regulations of the Commission) to the Trust in such sum and with
such surety or sureties as the Trustees may determine, conditioned upon the
faithful performance of his duties to the Trust including responsibility for
negligence and for the accounting of any of the Trust's property, funds or
securities that may come into his hands.

SECTION 3.13. REMOVAL. Any officer may be removed from office, with
or without cause, whenever in the judgment of the Trustees the best interest of
the Trust will be served thereby, by the vote of a majority of the Trustees
given at any regular meeting or any special meeting of the Trustees. In
addition, any officer or agent appointed in accordance with the provisions of
Section 3.11 hereof may be removed, either with or without cause, by any officer
upon whom such power of removal shall have been conferred by the Trustees.

SECTION 3.14. REMUNERATION. The salaries or other compensation, if
any, of the officers of the Trust shall be fixed from time to time by resolution
of the Trustees.

ARTICLE IV.
SHAREHOLDERS' MEETINGS

SECTION 4.1. SPECIAL MEETINGS. A special meeting of the shareholders
shall be called by the Secretary whenever (a) ordered by the Trustees or (b)
requested in writing by the holder or holders of at least 10% of the Outstanding
Shares entitled to vote. If the Secretary, when so ordered or requested,
refuses or neglects for more than 30 days to call such special meeting, the
Trustees or the Shareholders so requesting may, in the name of the Secretary,
call the meeting by giving notice thereof in the manner required when notice is
given by the Secretary. If the meeting is a meeting of the Shareholders of one
or more Series or classes of Shares, but not a meeting of all Shareholders of
the Trust, then only special meetings of the Shareholders of such one or more
Series or classes shall be called and only the shareholders of such one or more
Series or classes shall be entitled to notice of and to vote at such meeting.

SECTION 4.2. NOTICES. Except as provided in Section 4.1, notices of
any meeting of the Shareholders shall be given by the Secretary by delivering or
mailing, postage prepaid, to each Shareholder entitled to vote at said meeting,
written or printed

(6)
<PAGE>

notification of such meeting at least ten (10) days before the meeting, to such
address as may be registered with the Trust by the Shareholder. Notice of any
Shareholder meeting need not be given to any Shareholder if a written waiver of
notice, executed before or after such meeting, is filed with the records of such
meeting, or to any Shareholder who shall attend such meeting in person or by
proxy. Notice of adjournment of a Shareholder's meeting to another time or
place need not be given, if such time and place are announced at the meeting or
reasonable notice is given to persons present at the meeting and the adjourned
meeting is held within a reasonable time after the date set for the original
meeting.

SECTION 4.3. VOTING PROXIES. Subject to the provisions of the Trust
Instrument, Shareholders entitled to vote may vote either in person or by proxy,
provided that either (a) an instrument authorizing such proxy to act is executed
by the Shareholder in writing and dated not more than eleven (11) months before
the meeting, unless the instrument specifically provides for a longer period or
(b) the Trustees adopt by resolution an electronic, telephonic, computerized or
other alternative to execution of a written instrument authorizing the proxy to
act, which authorization is received not more than eleven (11) months before the
meeting. Proxies shall be delivered to the Secretary of the Trust or other
person responsible for recording the proceedings before being voted. A proxy
with respect to shares held in the name of two or more persons shall be valid if
executed by one of them unless at or prior to exercise of such proxy the Trust
receives a specific written notice from any one of them. Unless otherwise
specifically limited by their terms, proxies shall entitle the holder thereof to
vote at any adjournment of a meeting. A proxy purporting to be exercised by or
on behalf of a Shareholder shall be deemed valid unless challenged at or prior
to its exercise and the burden of proving invalidity shall rest on the
challenger. At all meetings of the Shareholders, unless the voting is conducted
by inspectors, all questions relating to the qualifications of voters, the
validity of proxies, and the acceptance or rejection of votes shall be decided
by the Chairman of the meeting. Except as otherwise provided herein or in the
Trust Instrument, as these Bylaws or such Trust Instrument may be amended or
supplemented from time to time, all matters relating to the giving, voting or
validity of proxies shall be governed by the General Corporation Law of the
State of Delaware relating to proxies, and judicial interpretations thereunder,
as if the Trust were a Delaware corporation and the Shareholders were
shareholders of a Deaware corporation.

SECTION 4.4. PLACE OF MEETING. All special meetings of the
Shareholders shall be held at the principal place of business of the Trust or at
such other place in the United States as the Trustees may designate.

(7)
<PAGE>

SECTION 4.5. ACTION WITHOUT A MEETING. Any action to be taken by
Shareholders may be taken without a meeting if a majority of the Shareholders
entitled to vote on the matter consent to the action in writing and the written
consents are filed with the records of meetings of Shareholders of the Trust.
Such consent shall be treated for all purposes as a vote at a meeting of the
Shareholders held at the principal place of business of the Trust.

ARTICLE V.
TRUSTEES' MEETINGS

SECTION 5.1. SPECIAL MEETINGS. Special meetings of the Trustees may
be called orally or in writing by the Chairman of the Board of Trustees or any
two other Trustees.

SECTION 5.2. REGULAR MEETINGS. Regular meetings of the Trustees may
be held at such places and at such times as the Trustees may from time to time
determine; each Trustee present at such determination shall be deemed a party
calling the meeting and no call or notice will be required to such Trustee
provided that any Trustee who is absent when such determination is made shall be
given notice of the determination by the Chairman or any two other Trustees, as
provided for in Section 4.4 of the Trust Instrument.

SECTION 5.3. QUORUM. A majority of the Trustees shall constitute a
quorum for the transaction of business at any meeting and an action of a
majority of the Trustees in attendance constituting a quorum shall constitute
action of the Trustees.

SECTION 5.4. NOTICE. Except as otherwise provided, notice of any
special meeting of the Trustees shall be given by the party calling the meeting
to each of the Trustees, as provided for in Section 4.4 of the Trust Instrument.
A written notice may be mailed, postage prepaid, addressed to him at his address
as registered on the books of the Trust or, if not so registered, at his last
known address.

SECTION 5.5. PLACE OF MEETING. All special meetings of the Trustees
shall be held at the principal place of business of the Trust or such other
place as the Trustees may designate. Any meeting may adjourn to any place.

SECTION 5.6. SPECIAL ACTION. When all the Trustees shall be present
at any meeting however called or wherever held, or shall assent to the holding
of the meeting without notice, or shall sign a written assent thereto filed with
the records of such meeting, the acts of such meeting shall be valid as if such
meeting had been regularly held.

SECTION 5.7. ACTION BY CONSENT. Any action by the Trustees may be
taken without a meeting if a written consent thereto is signed by all the
Trustees and filed with the records

(8)
<PAGE>

of the Trustees' meeting. Such consent shall be treated, for all purposes, as a
vote at a meeting of the Trustees held at the principal place of business of the
Trustees.

SECTION 5.8. PARTICIPATION IN MEETINGS BY CONFERENCE TELEPHONE.
Except when presence in person is required at a meeting under the 1940 Act or
other applicable laws, Trustees may participate in a meeting of Trustees by
conference telephone or similar communications equipment by means of which all
persons participating in the meeting are able to hear each other, and such
participation shall constitute presence in person at such meeting. Any meeting
conducted by telephone shall be deemed to take place at and from the principal
office of the Trust.

ARTICLE VI.
FISCAL YEAR; REGISTERED OFFICE AND REGISTERED AGENT

SECTION 6.1. FISCAL YEAR. The fiscal year of the Trust and of each
Series of the Trust shall end on [ ] of each year; provided that the
last fiscal year of the Trust and each series shall end on the date on which the
Trust or each such Series is terminated, as applicable; and further provided
that the Trustees by resolution and without a Shareholder vote may at any time
change the fiscal year of the Trust and of any or all Series (and the Trust and
each Series may have different fiscal years as determined by the Trustees).

SECTION 6.2. REGISTERED OFFICE AND REGISTERED AGENT. The initial
registered office of the Trust in the State of Delaware shall be located at c/o
The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street,
City of Wilmington, Delaware 19801. The registered agent of the Trust at such
location shall be The Corporation Trust Company; provided that the Trustees by
resolution and without a Shareholder vote may at any time change the Trust's
registered office or its registered agent, or both.

ARTICLE VII.
INSPECTION OF BOOKS

The Trustees shall from time to time determine whether and to what
extent, and at what times and places, and under what conditions and regulations
the accounts and books of the Trust or any of them shall be open to the
inspection of the Shareholders; and no Shareholder shall have any right to
inspect any account or book or document of the Trust except as conferred by law
or otherwise by the Trustees or by resolution of the Shareholders.

ARTICLE VIII.
INSURANCE OF OFFICERS, TRUSTEES, AND EMPLOYEES

The Trust may purchase and maintain insurance on behalf of any Covered
Person (as defined in Section 10.2 of the Trust Instrument) or employee of the
Trust, including any Covered

(9)
<PAGE>

Person or employee of the Trust who is or was serving at the request of the
Trust as a Trustee, officer or employee of a corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and claimed by him in any such capacity or arising out of his status as such,
whether or not the Trustees would have the power to indemnify him against such
liability.

The Trust may not acquire or obtain a contract for insurance that
protects or purports to protect any Trustee or officer of the Trust against any
liability to the Trust or its Shareholders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence, or
reckless disregard of the duties involved in the conduct of his office.

ARTICLE IX.
SEAL

The Trustees may adopt a seal which shall be in such form and have
such inscription as the Trustees may from time to time determine. Any Trustee
or officer of the Trust shall have the authority to affix the seal to any
document requiring the same.

ARTICLE X.
AMENDMENTS

All Bylaws of the Trust shall be subject to amendment, alteration or
repeal and new Bylaws may be made by the affirmative vote of a majority of the
Trustees at any meeting.

ARTICLE XI.
MISCELLANEOUS

SECTION 11.1. SEVERABILITY. The provisions of these Bylaws are
severable. If the Trustees determine, with the advice of counsel, that any
provision hereof conflicts with the applicable laws and regulations, the
conflicting provision shall be deemed never to have constituted a part of these
Bylaws, provided, however, that such determination shall not affect any of the
remaining provisions of these Bylaws or render invalid or improper any action
taken or omitted prior to such determination. If any provision hereof shall be
held invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall attach only to such provision only in such jurisdiction
and shall not affect any other provision of these Bylaws.

SECTION 11.2. HEADINGS. Headings are placed in these Bylaws for convenience of
reference only and in case of any conflict, the text of these Bylaws rather than
the headings shall control.

(10)