ACORN INVESTMENT TRUST, PRER14A, 1999-08-09

ACORN INVESTMENT TRUST
PRER14A, 1999-08-09

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<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A

(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]

Check the appropriate box:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
[_] Definitive Proxy Statement Commission Only (as permitted by
[_] Definitive Additional Materials Rule 14a-6(e)(2))
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

Acorn Investment Trust
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.

(1) Amount Previously Paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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<PAGE>

Preliminary
- -----------

Acorn Investment Trust
227 West Monroe Street, Suite 3000
Chicago, Illinois 60606-5016
1-800-____________

August __, 1999

Dear Shareholder:

You are cordially invited to attend a special meeting of shareholders of
Acorn Investment Trust which will be held on Tuesday, September 28, 1999 at 9:00
a.m. Central time, at First Chicago Center, 30 South Dearborn Street, Plaza
Level, Chicago, Illinois 60602.

Among the matters scheduled for consideration at the meeting are the
election of the trustees named in the attached proxy statement, and the approval
of changes in certain fundamental investment restrictions for Acorn Fund and
Acorn International, as more fully discussed in the proxy statement.

Your vote is important. Please take the time to familiarize yourself with
the Proposals. Then, please complete, sign and date the enclosed proxy card and
return it in the enclosed envelope. [You may receive more than one proxy card
if you own shares in more than one fund. Please sign and return each proxy card
you receive.] This will ensure that your vote is counted, even if you can't
attend the meeting in person.

If you prefer, you may also vote by calling toll-free 1-800-848-3410 or via
the Internet at www.proxyvote.com. For instructions on how to complete the proxy
card, vote by telephone or via the Internet, please see the section entitled
"More Information About The Meeting" in the proxy statement.

Please call our proxy solicitor, D. F. King & Co., at 1-800-___-____ with
any questions about voting.

Sincerely,

Irving B. Harris
Chairman of the Board
<PAGE>

Acorn Investment Trust
227 West Monroe Street, Suite 3000
Chicago, Illinois 60606-5016
1-800-________

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
Tuesday, September 28, 1999

A special meeting of shareholders of Acorn Investment Trust ("Acorn" or the
"Trust") will be held at First Chicago Center, 30 South Dearborn Street, Plaza
Level, Chicago, Illinois 60602, at 9:00 a.m., Central time, on Tuesday,
September 28, 1999. At the meeting, shareholders will be asked to vote on the
following proposals:

1. To elect 12 trustees;

2. [for Acorn Fund shareholders only] To approve changes in Acorn Fund's
fundamental investment restrictions relating to borrowing, pledging
securities, making loans and potentially conflicting investments;

3. [for Acorn International shareholders only] To approve a change in Acorn
International's fundamental investment restriction relating to borrowing;

4. To ratify the selection of Ernst & Young LLP as the Trust's independent
public accountants for the fiscal year ending December 31, 1999; and

5. To transact any other business that properly comes before the meeting.

Shareholders of record as of the close of business on August 1, 1999 are
entitled to vote at the meeting (or any adjournments of the meeting). This proxy
statement and proxy card are being mailed to shareholders on or about August
[16], 1999.

By Order of the Board of Trustees,

Steven A. Radis
Secretary

August [16], 1999
Chicago, Illinois

WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE COMPLETE AND
RETURN THE ENCLOSED PROXY CARD. YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE
MEETING.
<PAGE>

Acorn Investment Trust
227 West Monroe Street, Suite 3000
Chicago, Illinois 60606-5016
1-800-__________

Proxy Statement
Special Meeting of Shareholders
September 28, 1999

This proxy statement is being sent to you by the board of trustees of Acorn
Investment Trust. The board is asking you to complete and return the enclosed
proxy card, permitting your shares of Acorn Fund, Acorn International, Acorn
USA, Acorn Twenty or Acorn Foreign Forty to be voted at the meeting, even if you
cannot attend the meeting in person. The meeting will be held at First Chicago
Center, 30 South Dearborn Street, Plaza Level, Chicago, Illinois 60602, at 9:00
a.m. Central time, on Tuesday, September 28, 1999. Shareholders of record at the
close of business on August 1, 1999 (called the "record date") are entitled to
vote at the meeting.

You should also have received Acorn's annual report to shareholders for the
fiscal year ended December 31, 1998. If you would like another copy of the
annual report, please call or write to Acorn at the address and telephone number
shown at the top of this page. The report will be sent to you without charge.

For convenience, Acorn Investment Trust is referred to in this proxy
statement as "Acorn" or "the Trust." Acorn Fund, Acorn International, Acorn USA,
Acorn Twenty and Acorn Foreign Forty are referred to individually as a "Fund"
and together as the "Funds."

SUMMARY OF PROPOSALS

This proxy statement covers four Proposals -- the election of trustees, the
approval of changes to certain fundamental investment restrictions for Acorn
Fund, the approval of a change to one fundamental investment restriction for
Acorn International, and the ratification of the board's selection of Ernst &
Young LLP as the Trust's independent auditors. The shareholders of all Funds
will vote on the election of trustees and ratification of the selection of
auditors. The shareholders of Acorn Fund and Acorn International will vote
separately on the changes to investment restrictions affecting each Fund, as
shown in the table below:

<TABLE>
<CAPTION>
Proposal Fund
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Acorn Acorn Acorn USA Acorn Acorn
Fund International Twenty Foreign Forty
- ------------------------------------------------------------------------------------------------------------------------
1. Election of Trustees X X X X X
- ------------------------------------------------------------------------------------------------------------------------
2. Changes to Acorn Fund's Fundamental X
Investment Restrictions
- ------------------------------------------------------------------------------------------------------------------------
3. Changes to Acorn International's X
Fundamental Investment Restrictions
- ------------------------------------------------------------------------------------------------------------------------
4. Ratification of Ernst & Young LLP as X X X X X
the Trust's Independent Auditors
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>

PROPOSAL 1

ELECTION OF TRUSTEES

The persons named on the accompanying proxy card intend to vote at the
meeting (unless otherwise directed) FOR the election of the 12 nominees named
below as trustees of the Trust. Eleven of the nominees currently serve as
trustees. Each nominee has been recommended by the nominating committee of the
board of trustees and each nomination was unanimously approved by the board of
trustees.

The nominating committee will also consider nominees recommended by
shareholders to serve as trustees provided that shareholders submitting such
recommendations comply with all applicable provisions of Rule 14a-8 under the
Securities Exchange Act of 1934 (the "Exchange Act").

Each trustee will be elected to hold office until the next meeting of
shareholders or until his or her successor is elected and qualified. Each
nominee has consented to being named herein and indicated his or her willingness
to serve if elected. If any such nominee is unable to serve because of an event
not now anticipated, the persons named as proxies may vote for another person
designated by the board of trustees.

The following table sets forth each nominee's position(s) with the Trust,
date of birth, principal occupation or employment during the past five years,
directorships and trusteeships and the date on which he or she first became a
trustee of Acorn (or a director of Acorn's predecessor).

<TABLE>
<CAPTION>
Principal Occupation of Employment and
Name and Date of Birth Position(s) with the Trust Directorships/Trusteeships
---------------------- -------------------------- --------------------------
<S> <C> <C>
Irving B. Harris Trustee and Chairman of the Chairman of the executive committee and director,
8/4/1910 Board since 1970 Pittway Corporation (multi-product manufacturer and
publisher); Chairman, William Harris Investors,
Inc. (investment adviser); Chairman, The Harris
Foundation (charitable foundation).

Ralph Wanger* Trustee and President Trustee and president, Wanger Advisors Trust;
6/21/1934 since 1970 Principal and portfolio manager, Wanger Asset
Management, L.P.; Director, Wanger Investment
Company plc.

James H. Lorie Trustee and Vice Chairman of Retired; Eli B. and Harriet B. Williams Professor
2/23/1922 the Board since 1970 of Business Administration Emeritus, University of
Chicago Graduate School of Business; Director,
Thornburg Mortgage Asset Corp. (REIT) and Santa Fe
Natural Tobacco.
</TABLE>

2
<PAGE>

Leo A. Guthart Trustee since 1994 Vice chairman, Pittway Corporation (multi-product
9/26/1937 manufacturer and publisher); Chief executive
officer, Pittway Corporation's Security Group of
Companies which include ADEMCO (manufacturer of
alarm equipment), ADI (distributor of security
equipment), Fire Burglary Instruments (supplier of
security control panels), First Alert Professional
(alarm dealers), Alarm Net (cellular radio service)
and Cylink Corporation (supplier of encryption
equipment)(chairman of Cylink); Director,
AptarGroup, Inc. (producer of dispensing valves,
pumps and closures); Chairman of the board of
trustees, Hofstra University.

Jerome Kahn, Jr. Trustee since 1987 President, William Harris Investors, Inc.
4/13/1934 (investment adviser); Director, Pittway Corporation
(multi-product manufacturer and publisher).

Steven N. Kaplan Nominee Neubauer Family Professor of Entrepreneurship and
12/21/1959 Finance, University of Chicago Graduate School of
Business; Director, ImageMax.

David C. Kleinman Trustee since 1972 Adjunct professor of strategic management;
10/12/1935 University of Chicago Graduate School of Business;
Business consultant; Chairman of the Board, Irex
Corporation (insulation contractor); Director, Sonic
Foundry, Inc. (software); FirstCom Corp., (competitive
local exchange carrier); Organics Management Company
(organic waste processor); Wisconsin Paper & Products
(paper merchant); Plymouth Tube Company (seamless and
welded metal tubing); Member of the advisory board,
DSC Logistics Company (warehousing and logistics
services).

Charles P. McQuaid* Trustee and Senior Vice Trustee and Senior Vice President, Wanger Advisors
8/27/1953 President since 1992 Trust; Principal, portfolio manager and director of
research, Wanger Asset Management, L.P.

Roger S. Meier Trustee since 1991 CEO and Chairman of the Board, AMCO, Inc.
1/18/1926 (investment and real estate management); President,
AMCO, Inc. 1986-1999; Director and advisory board
member, Key Bank of Oregon (banking); Chairman of
Investment Council and member of Committee of
Legacy Systems (hospital); Executive director and
chairman of investment committee, Portland Art
Museum.

Allan B. Muchin Trustee since 1998 Partner, Katten, Muchin & Zavis (law firm);
1/10/1936 Director, Alberto-Culver Company (toiletries).

Robert E. Nason Trustee since 1998 Private investor; Director, Fairfax
7/26/1936 Insurance Limited (privately owned insurance
company); from 1990-1998, Executive partner, chief
executive officer and member of the executive
committee of Grant Thornton LLP (public accounting
firm) and member of the policy board of Grant
Thornton International.
</TABLE>

3
<PAGE>

<TABLE>
<CAPTION>
Principal Occupation of Employment and
Name and Date of Birth Position(s) with the Trust Directorships/Trusteeships
---------------------- -------------------------- --------------------------
<S> <C> <C>
Katherine Schipper Trustee since 1998 Eli B. and Harriet B. Williams Professor of
10/04/1949 Accounting, KPMG Peat Marwick Faculty Research
Scholar and Director of the Institute of
Professional Accounting, University of Chicago
Graduate School of Business; Visiting Professor at
Fuqua School of Business, Duke University, in the
academic year 1999-2000.
</TABLE>

*Mr. Wanger and Mr. McQuaid are trustees who are interested persons of
Acorn as defined in the Investment Company Act of 1940, and of WAM.

The address of Messrs. Harris and Kahn is Two North LaSalle Street, Suite
400, Chicago, Illinois 60602; the address of Messrs. Wanger and McQuaid is 227
West Monroe Street, Suite 3000, Chicago, Illinois 60606; the address of Messrs.
Lorie, Kleinman and Kaplan and of Ms. Schipper is 1101 East 58th Street,
Chicago, Illinois 60637; the address of Mr. Guthart is 165 Eileen Way, Syosset,
New York 11791; the address of Mr. Meier is 1211 S.W. Fifth Avenue, Portland,
Oregon 97204; the address of Mr. Muchin is 525 West Monroe Street, Suite 1600,
Chicago, Illinois 60661; and the address of Mr. Nason is 567 Rockefeller Road,
Lake Forest, Illinois 60045.

Committees of the Board of Trustees. Acorn's board of trustees currently
has five committees:

. Executive Committee. Messrs. Harris, Lorie, and Wanger are members, and Mr.
McQuaid is an alternate member, of the executive committee, which has
authority during intervals between meetings of the board of trustees to
exercise the powers of the board, with certain exceptions.

. Audit Committee. Messrs. Kleinman and Nason and Ms. Schipper serve on the
audit committee of the board of trustees. The audit committee recommends
independent auditors to the trustees, monitors the auditors' performance,
reviews the results of each Fund's audit and responds to other matters
deemed appropriate by the board of trustees.

. Pricing Committee. Messrs. Wanger, Harris and McQuaid are members, and
Messrs. Guthart and Lorie are alternate members, of the pricing committee
of the board of trustees. The pricing committee determines valuations of
portfolio securities held in any Fund in instances in which the routine
valuation procedures adopted by the board of trustees do not produce a fair
value.

. Investment Advisory Agreements Committee. Messrs. Meier, Guthart, Kahn,
Kleinman and Muchin are members of the investment advisory agreement
committee of the board of trustees, which makes recommendations to the
board of trustees regarding the continuation or amendment of the investment
advisory agreements between the Trust and WAM.

4
<PAGE>

. Nominating Committee. Messrs. Lorie, Harris, McQuaid, Meier, Muchin, Nason
and Wanger serve on the nominating committee of the board of trustees,
which considers and recommends candidates for election to the board of
trustees.

During the fiscal year ended December 31, 1998, the board of trustees held
six meetings, the audit committee held three meetings, the pricing committee
held four meetings and the nominating committee held three meetings. The
executive committee and the investment advisory agreements committee did not
meet. All of the trustees and committee members then serving attended at least
75% of the meetings of the board of trustees or applicable committee, if any,
held during the fiscal year ended December 31, 1998.

Officers. Mr. Wanger is president and Mr. McQuaid is senior vice president
of Acorn. The table of trustees on page 2 gives more information about Mr.
Wanger and Mr. McQuaid. The following table lists the name, date of birth,
position(s) with the Trust and business history for the past five years of each
of the Trust's other officers. Each officer serves until his successor is chosen
and qualified or until his resignation or removal by the board of trustees. The
business address of all officers of the Trust is 227 West Monroe Street, Suite
3000, Chicago, Illinois 60606.

Name and Date of Birth Position(s) Held with the Trust Principal Occupation(s) During Past Five Years
---------------------- ------------------------------- ----------------------------------------------
<S> <C> <C>
Margaret M. Forster Vice President Principal since January 1, 1999, and analyst and
1/28/1960 portfolio manager since 1994, Wanger Asset Management,
L.P.; assistant professor of finance, Kellogg Graduate
School of Management, Northwestern University, 1993-1994.

Marcel P. Houtzager Vice President Principal, analyst and portfolio manager, Wanger Asset
10/26/1960 Management, L.P.; Vice President, Wanger Advisors Trust.

Kenneth A. Kalina Assistant Treasurer Fund controller, Wanger Asset Management, L.P., since
8/4/1959 September 1995; Assistant Treasurer, Wanger Advisors
Trust; prior thereto, Treasurer of the Stein Roe Mutual Funds.

Bruce H. Lauer Vice President, Assistant Managing Director (since February 1999) and Chief Administrative
7/22/1957 Secretary and Officer (since April 1995), Wanger Asset Management, L.P.;
Treasurer Vice President, Assistant Secretary and Treasurer, Wanger Advisors
Trust; prior to April 1995, First vice president, investment
accounting, Kemper Financial Services, Inc.; Director, Wanger
Investment Company plc; Director, New Americas Small Cap Fund.

Robert A. Mohn Vice President Principal since 1998, analyst and portfolio manager, Wanger Asset
9/13/1961 Management, L.P.; Vice President, Wanger Advisors Trust.

John H. Park Vice President Principal since 1998, analyst and portfolio manager, Wanger Asset
5/30/1967 Management, L.P. (since 1993); Vice President, Wanger Advisors
Trust.
</TABLE>

5
<PAGE>

Name and Date of Birth Position(s) Held with the Trust Principal Occupation(s) During Past Five Years
---------------------- ------------------------------- ----------------------------------------------
<S> <C> <C>
Steven A. Radis Secretary Managing Director, Chief Marketing Officer, Wanger Asset
8/24/1962 Management, L.P. since April 1999; Secretary, Wanger
Advisors Trust; Vice President, Corporate and Marketing
Communications, Zurich Kemper Life (January 1998-March 1999);
First Vice President, Corporate Communications, Zurich
Kemper Investments (January 1987-December 1997).

Mark H. Yost Vice President Analyst and portfolio manager, Wanger Asset Management, L.P.,
6/28/1963 since October 1995; Vice President, Wanger Advisors Trust;
prior thereto, investment analyst, First Chicago Corporation.

Leah J. Zell Vice President Principal, analyst and portfolio manager, Wanger Asset
5/23/1949 Management, L.P.; Vice President, Wanger Advisors Trust.
</TABLE>

Mr. Wanger and Ms. Zell are married to each other.

Compensation of Trustees and Officers. Messrs. Wanger and McQuaid and the
other officers of the Trust do not receive any compensation from the Trust.
During 1998 the funds paid fees aggregating $302,000 to board members who were
not affiliated with WAM. The following table sets forth the total compensation,
(including any amounts deferred, as described below) paid by the Trust during
the fiscal year ended December 31, 1998 to each of the trustees of the Trust:

<TABLE>
<CAPTION>
Aggregate Compensation from:
- ----------------------------------------------------------------------------------------------------------------------
Acorn
Acorn Acorn Acorn Foreign Fund
Name of Trustee Acorn Fund International USA Twenty(+) Forty(+) Complex
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Irving B. Harris 60,800 27,500 2,700 0 0 $91,000

Leo A. Guthart 23,450 10,500 1,050 0 0 $35,000

Jerome Kahn, Jr. 23,450 10,500 1,050 0 0 $35,000

David C. Kleinman 23,450 10,500 1,050 0 0 $35,000

James H. Lorie 23,950 10,500 1,050 0 0 $35,500

Charles P. McQuaid 0 0 0 0 0 0

Roger S. Meier 23,450 10,500 1,050 0 0 $35,000

Adolph Meyer, Jr.* 19,430 8,700 870 0 0 $29,000

Allan B. Muchin** 1,452 650 65 0 0 $ 2,167

Robert E. Nason** 1,452 650 65 0 0 $ 2,167

Katherine Schipper** 1,452 650 65 0 0 $ 2,167

Ralph Wanger 0 0 0 0 0 0
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(+) Since November 23, 1998.
* Served on the Board of the Trust until December 31, 1998.

<PAGE>

** Elected to the Board of the Trust effective December 1, 1998.

The officers and trustees affiliated with WAM serve without any
compensation from the Trust. Acorn has adopted a deferred compensation plan (the
"Plan") for its non-interested trustees. Under the Plan, the trustees who are
not "interested persons" of Acorn or WAM ("participating trustees") may defer
receipt of all or a portion of their compensation from the Trust in order to
defer payment of income taxes or for other reasons. The deferred compensation
payable to a participating trustee is credited to such trustee's deferral
account as of the business day such compensation would have been paid to such
trustee. The deferred compensation accrues income from the date of credit in an
amount equal to the amount that would have been earned had the participating
trustee invested his or her compensation in shares of one or more of the funds.
If a participating trustee retires, such trustee may elect to receive payments
under the plan in a lump sum or in equal annual installments over a period of
five years. If a participating trustee dies, any amount payable under the Plan
will be paid to that trustee's beneficiaries. Each fund's obligation to make
payments under the Plan is a general obligation of that fund. No fund is liable
for any other fund's obligations to make payments under the Plan.

As of May 31, 1999, the trustees and officers of Acorn as a group owned
beneficially less than 1% of the outstanding shares of the Funds.

Required Vote. In accordance with the Trust's Agreement and Declaration of
Trust, the vote of a plurality of all of the shares of the Funds voted at the
Meeting is required to elect the nominees. Each share is entitled to one vote.

PROPOSALS 2(a) THROUGH 2(d)
CHANGES TO FUNDAMENTAL INVESTMENT RESTRICTIONS
For Shareholders of Acorn Fund Only

The board of trustees recommends that shareholders vote FOR the amendment
of certain fundamental investment restrictions for Acorn Fund.

Each of the proposed changes is described below. All of Acorn Fund's
current restrictions are set forth in Acorn's Statement of Additional
Information.

Proposal 2(a) - Elimination of restriction regarding ownership of securities of
issuers in which affiliates of the Trust have invested.

Acorn Fund now has a fundamental policy that currently states that the Fund
will not:

Purchase or retain securities of a company if all of the trustees and
officers of the Trust and of its investment adviser who individually own
beneficially more than 1/2% of the securities of the company collectively
own beneficially more than 5% of such securities.

This restriction is not required by the 1940 Act, but was formerly required
by a state law that no longer applies to the Fund. The purpose of the state law
that required this restriction was

7
<PAGE>

to reduce conflicts of interest in the management of mutual funds. However, the
policy focused on fund investments rather than investments by fund officers and
trustees. Acorn has a code of ethics that was adopted in accordance with the
rules of the Securities and Exchange Commission and governs the personal
securities transactions of Acorn's officers and trustees, and the employees of
WAM. The board of trustees believes that the restrictions on personal
investments in the code of ethics are a better way to prevent the occurrence of
conflicts of interest. Therefore, it is proposed that this restriction be
eliminated.

Proposal 2(b) - Amendment of restriction regarding borrowing.

Acorn Fund's existing fundamental restriction regarding borrowing is
proposed to be amended as shown below, with new language underscored and
language that will be deleted stricken through:

[The Fund will not:]

Borrow money except (a) from banks for temporary or emergency purposes
(language to be stricken out [at fixed rates of interest]) in amounts not
exceeding (language to be stricken out [10%]) 33% of the value of the
fund's assets at the time of borrowing, and (b) in connection with
transactions in options and in securities index futures.

The 1940 Act requires that a fund state a fundamental policy regarding
borrowing. As currently stated, Acorn Fund's restriction is significantly more
limiting than the requirements of the 1940 Act. The proposed amendment would
make two changes: it would allow the Fund to borrow up to 33% of the value of
its total assets, the maximum amount allowed by law, and it would permit those
borrowings to be at floating rates of interest. As under the current
restriction, any borrowings would be from banks and would be for temporary or
emergency purposes (generally to meet redemptions).

The increase in the maximum amount of Acorn Fund's borrowings would give
the Fund more flexibility to borrow to meet its temporary or emergency cash flow
needs. Because any such borrowings would be for temporary or emergency purposes,
and not for the purpose of generating cash to make investments, the Fund will
not purchase any new portfolio securities when its borrowings, less amounts
receivable from the sale of its portfolio securities, exceed 5% of its total
assets.

The proposed amended restriction would eliminate the need for the Fund to
obtain loans at fixed rates of interest. Acorn currently has a line of credit
under which each of the Funds may borrow. The rate of interest on borrowings by
each of the other Funds bears interest at a floating rate; any borrowings by
Acorn Fund are at a fixed rate of interest, which could be more costly. If the
proposed amendment to the restriction on borrowing is approved, Acorn Fund would
be able to borrow at either a fixed or a floating rate of interest, which could
reduce the cost of the line of credit to Acorn Fund.

Proposal 2(c) - Amendment of restriction regarding pledging of assets.

8
<PAGE>

Acorn Fund's existing fundamental restriction regarding pledging of assets
is proposed to be amended as shown below, with new language underscored and
language that will be deleted stricken through:

[The Fund will not:]

Pledge, mortgage or hypothecate its assets, except in connection with
permitted borrowings (language to be stricken out [for temporary or
emergency purposes and then to an extent not greater than 15% of its assets
at cost, and except in connection with transactions in options and in
securities index futures.]).

The proposed change to the restriction on pledging is intended to conform
it to the Fund's restriction on borrowing. The elimination of the 15% limit on
pledging will allow the Fund to give a bank lender a security interest in Fund
assets to secure borrowings by the Fund, if doing so is determined by the board
of trustees to be in the best interests of the Fund and its shareholders.

Proposal 2(d). - Amendment of restriction regarding loans.

Acorn Fund's existing fundamental policy regarding loans currently states:

It is also a fundamental policy of Acorn Fund to make loans to the
extent that investment in debt securities may be considered to constitute
the making of loans (subject to the 10% limitation stated in [the Fund's
restriction on purchasing unregistered securities]).

The proposed new restriction provides that the Fund may not:

Make loans, but this restriction shall not prevent the Fund from (a)
buying a part of an issue of bonds, debentures, or other obligations that
are publicly distributed, or from investing up to an aggregate of 15% of
its total assets (taken at market value at the time of each purchase) in
parts of issues of bonds, debentures or other obligations of a type
privately placed with financial institutions, (b) investing in repurchase
agreements, or (c) lending portfolio securities, provided that it may not
lend securities if, as a result, the aggregate value of all securities
loaned would exceed 33% of its total assets (taken at market value at the
time of such loan).

The proposed amendment will permit the Fund to do two things it cannot now
do - invest in repurchase agreements and lend portfolio securities.

A repurchase agreement is a transaction in which a fund purchases a
security from a bank or securities dealer and simultaneously agrees to re-sell
that security to the bank or dealer at an agreed upon price on a set date. Acorn
USA, Acorn Twenty and Acorn Foreign Forty use repurchase agreements as a way to
put otherwise uninvested cash to work, and Acorn Fund expects to do the same
thing if the proposed change is approved. Repurchase agreements carry risks
related to the creditworthiness of the counterparty, but Acorn Fund would enter
into
9
<PAGE>

repurchase agreements only with banks and dealers WAM believes present minimal
credit risks and the obligations or the counterparty would be fully secured. WAM
periodically reviews and monitors the creditworthiness of repurchase agreement
counterparties.

The proposed new restriction would also permit Acorn Fund to loan its
portfolio securities, up to a limit of 33% of the Fund's total assets. Banks and
broker-dealers often need to borrow securities to fulfill their own obligations
and will pay the lender of the security. In a securities lending program, the
borrower's obligations are generally fully collateralized. The lending fund
generally receives any income generated by the loaned security and retains all
or part of the income earned by the invested collateral. The lending fund can
generally call the loan and regain the security to regain its right to vote on
matters affecting that security. Securities lending can present risks if the
borrower defaults, and the lending fund could incur costs or delays in enforcing
its rights.

Acorn has periodically evaluated whether lending the portfolio securities
of the Funds would be desirable and has concluded in the past that the
additional income that would be generated by a securities lending program would
not justify the administrative burden and risk. However, the board of trustees
believes that it would be desirable to have the ability to implement a
securities lending program if, at a later date, the board should determine that
doing so is in the best interests of the Fund and its shareholders.

Required Vote. Approval of each part of Proposal 2 requires the affirmative
vote of the lesser of (a) 67 percent or more of the voting shares of Acorn Fund
present at the meeting, if the holders of more than 50 percent of the
outstanding voting shares of Acorn Fund are present or represented by proxy, or
(b) more than 50 percent of the outstanding voting shares of Acorn Fund Shares
of the other Funds are not entitled to vote on Proposal 2.

PROPOSAL 3
CHANGE TO FUNDAMENTAL INVESTMENT RESTRICTION
For Shareholders of Acorn International Only

The board of trustees recommends that shareholders vote FOR the amendment
of Acorn International's fundamental investment restriction relating to
borrowing. All of Acorn International's current restrictions are set forth in
Acorn's Statement of Additional Information.

Acorn International's existing fundamental restriction regarding borrowing
is proposed to be amended as shown below, with new language underscored and
language that will be deleted stricken through:

[The Fund will not:]

Borrow money except (a) from banks for temporary or emergency purposes
in amounts not exceeding 33% (language to be stricken out [10%]) of the
value of the fund's total assets at the time of borrowing, and (b) in
connection with transactions in options, futures and options on futures.

10
<PAGE>

The proposed language allows the Fund to borrow up to 33% of the value of
its total assets, the maximum amount allowed by law. As under the current
restriction, any borrowings would be from banks and would be for temporary or
emergency purposes (generally to meet redemptions).

Required Vote. Approval of Proposal 3 requires the affirmative vote of the
lesser of (a) 67 percent or more of the voting shares of Acorn International
present at the meeting, if the holders of more than 50 percent of the
outstanding voting shares of Acorn International are present or represented by
proxy, or (b) more than 50 percent of the outstanding voting shares of Acorn
International. Shareholders of the other Funds are not entitled to vote on
Proposal 3.

PROPOSAL 4
RATIFICATION OF SELECTION OF AUDITORS

The board of trustees recommends that the shareholders of each Fund ratify
the board of trustees' selection of Ernst & Young LLP as independent public
accountants for each Fund for the fiscal year ending December 31, 1999.

For the year ended December 31, 1998, Ernst & Young LLP examined the
financial statements of the Trust and provided consultation on financial
accounting, reporting and tax matters. Representatives of Ernst & Young LLP
will be present at the Meeting and will have an opportunity to make a statement
if they desire to do so. They also will be available to respond to appropriate
questions presented at the meeting.

Required Vote. Approval of the selection of auditors for a Fund requires
the affirmative vote of a majority of the shares of that Fund represented at the
Meeting in person or by proxy, if a quorum is present.

The board of trustees of Acorn, including all of the trustees who are not
affiliated with Acorn, unanimously recommends that shareholders of the Funds
vote FOR ratification of the selection of auditors.

MORE INFORMATION ABOUT ACORN

Organization and Management of the Trust

11
<PAGE>

The Trust is a Massachusetts business trust organized on April 21, 1992.
The Trust is an open-end management investment company, currently with five
series: Acorn Fund, Acorn International, Acorn USA, Acorn Twenty and Acorn
Foreign Forty. Acorn Fund began operations in 1970 as The Acorn Fund, Inc., and
was reorganized as the Acorn Fund series of the Trust, effective June 30, 1992.
Acorn International and Acorn USA began operations on September 23, 1992 and
September 4, 1996, respectively. Acorn Twenty and Acorn Foreign Forty each
began operations on November 23, 1998.

The Trust is governed by a board of trustees, which is responsible for
protecting the interests of the shareholders of the Funds. The trustees are
experienced executives and professionals who meet at regular intervals to
oversee the activities of the Trust and the Funds. A majority of the trustees
are not otherwise affiliated with Acorn or WAM.

Investment Adviser

Wanger Asset Management, L.P. ("WAM"), serves as the investment adviser for
the funds and for other institutional accounts. WAM is a limited partnership
managed by its general partner, Wanger Asset Management, Ltd. ("WAM Ltd."),
whose stockholders are Ralph Wanger, Charles P. McQuaid, Leah J. Zell, Marcel P.
Houtzager, Robert A. Mohn, John H. Park and Margaret M. Forster. Ralph Wanger
is the president of WAM Ltd. WAM is located at 227 West Monroe Street, Suite
3000, Chicago, Illinois 60606.

Distributor

Shares of each Fund are offered for sale by WAM Brokerage Services, L.L.C.
("WAM BD") without any sales commissions, 12b-1 fees or other charges to the
Funds or their shareholders. WAM BD is wholly-owned by WAM and WAM Ltd. All
distribution expenses relating to the Funds are paid by WAM, including the
payment or reimbursement of any expenses incurred by WAM BD. WAM BD offers the
Funds' shares only on a best efforts basis. WAM BD is located at 227 West Monroe
Street, Suite 3000, Chicago, Illinois 60606.

MORE INFORMATION ABOUT THE MEETING

Date of Mailing. This proxy statement and enclosed proxy are being mailed
to shareholders on or about August [16], 1999.

Shareholders. At the record date, the Funds had the following numbers of
shares outstanding:

<TABLE>
<CAPTION>
Fund # Shares
---- --------
<S> <C>
Acorn Fund

Acorn International

Acorn USA
</TABLE>

12
<PAGE>

<TABLE>
<S> <C>
Acorn Twenty

Acorn Foreign Forty
</TABLE>

Of those shares, the only persons known to own of record or beneficially 5% or
more of the outstanding shares of any Fund as of the record date were:

<TABLE>
<CAPTION>
Percentage of
-------------
Outstanding Shares
------------------
Name and Address Fund Held
- ---------------- ---- ----
<S> <C> <C>

Charles Schwab & Co. Inc./(1)/ Acorn Fund
101 Montgomery Street Acorn International
San Francisco, CA 94104-4122 Acorn USA
Acorn Twenty
Acorn Foreign Forty

National Financial Services Corp./(1)/ Acorn International
P.O. Box 3908 Acorn USA
Church Street Station Acorn Foreign Forty
New York, NY 10008-3908

State of Illinois Employees Deferred Acorn Fund
Compensation Plan/(2)/
604 Stratton Office Bldg.
Springfield, IL 62706-0001

Donaldson Lufkin & Jenrette Acorn USA
Securities Corp./(1)/
Mutual Funds, 5th Floor
P.O. Box 2052
Jersey City, NC 07303-2052

FirstCinco Reinvest/(1)/ Acorn USA
P.O. Box 640229
Cincinnati, OH 45264-0001
</TABLE>

- -------------------
(1) Shares are held of record on behalf of customers, and not beneficially.
(2) Shares are held of record on behalf of plan participants, and not
beneficially.

How Proxies Will Be Voted. All proxies solicited by the board of trustees
that are properly executed and received prior to the meeting, and which are not
revoked, will be voted at the meeting. Shares represented by those proxies will
be voted in accordance with the instructions marked on the proxy. If no
instructions are specified, shares will be voted FOR each proposal.

13
<PAGE>

Revoking a Proxy. At any time before it has been voted, you may revoke
your proxy by: (1) sending a letter saying that you are revoking your proxy to
the Secretary of Acorn Investment Trust at the Trust's offices located at 227
West Monroe Street, Suite 3000, Chicago, Illinois 60606; (2) properly executing
a later-dated proxy; or (3) attending the meeting, requesting return of any
previously delivered proxy and voting in person.

How You May Vote. You may vote your shares by mail (by signing and
returning the enclosed proxy card), by telephone, or over the Internet. The
trustees have been advised by counsel that Massachusetts law and Acorn's
Agreement and Declaration of Trust and Bylaws permit voting by shareholders in
accordance with these procedures.

Internet Voting. You may give your voting instructions via the Internet by
logging on to Acorn's website at www.proxyvote.com. From there, you will be
given instructions on how to submit your vote. Management Information Services
Corp. ("MIS"), which has been engaged by Acorn to provide proxy-related
services--will record your instructions and transmit them to the official
tabulator and, within 72 hours, send you a letter or mailgram to confirm your
vote. That letter will also provide you with instructions on how to proceed if
the confirmation does not reflect your voting instructions correctly.

Telephone Voting. You may give your voting instructions over the telephone
by calling 1-800-848-3410. A representative of D.F. King will answer your call.
When receiving your instructions by telephone, the D.F. King representative is
required to ask you for your full name, address, social security or employer
identification number, title (if the person giving the proxy is authorized to
act for an entity, such as a corporation), the number of shares of a Fund owned
and to confirm that you have received the proxy statement in the mail. If the
information you provide matches the information provided to D.F. King by Acorn,
then the D.F. King representative will explain the process. D. F. King is not
permitted to recommend to you how to vote, other than to read any recommendation
included in the proxy statement. D.F. King will record your instructions and
transmit them to the official tabulator and, within 72 hours, send you a letter
or mailgram to confirm your vote. That letter will also ask you to call D.F.
King immediately if the confirmation does not reflect your instructions
correctly.

As the meeting date approaches, you may receive a call from a
representative of D.F. King if Acorn has not yet received your vote. D. F. King
may ask you for authority, by telephone or by electronically transmitted
instructions, to permit D. F. King to sign a proxy on your behalf. D.F. King
will record all instructions it receives from shareholders by telephone or
electronically, and the proxies it signs in accordance with those instructions,
in accordance with the procedures set forth above. The trustees believe those
procedures are reasonably designed to determine accurately the shareholder's
identity and voting instructions.

Voting by Mail. If you wish to participate in the Meeting, but do not wish
to give a proxy by telephone or via the Internet, you can still complete, sign
and mail the proxy card received with the proxy statement or attend the Meeting
in person. You can revoke any proxy, whether given in writing, by telephone, or
electronically, in accordance with the procedures outlined above under "Revoking
a Proxy."

14
<PAGE>

More Information About Proxies Will Be Solicited. Solicitation of proxies
by personal interview, mail, telephone and electronic mail may be made by
officers and trustees of Acorn and employees of WAM, none of whom will receive
any additional compensation for such service, and third-party solicitation
agents. All costs incurred in connection with the Meeting (including the cost
of solicitation of proxies) will be paid by Acorn. Acorn has engaged D.F. King
and MIS to assist in the solicitation of proxies. It is anticipated that the
cost of the proxy solicitation services provided by D.F. King will be
approximately $_______, and the cost of services provided by MIS will be
approximately _______.

Quorum, Voting at the Meeting and Adjournment. Thirty percent of the
shares entitled to vote present in person or represented by proxy constitutes a
quorum for the transaction of business at the meeting. On proposals for which
shareholders of a Fund vote separately, thirty percent of the shares of the Fund
entitled to vote at the meeting present in person or represented by proxy
constitutes a quorum of that Fund. For purposes of determining the presence or
absence of a quorum and for determining whether sufficient votes have been
received for approval of any matter to be acted upon at the meeting, abstentions
and broker non-votes will be treated as shares that are present at the meeting
but have not been voted.

Approval of Proposal 1 will require the affirmative vote of a plurality of
the shares of the Funds, voting together, represented at the Meeting in person
or by proxy, if a quorum is present. Abstentions and broker non-votes will have
the practical effect of a "No" vote on Proposal 1.

Each part of Proposal 2 and Proposal 3 must be voted on separately, and
approval will require the affirmative vote of the lesser of (a) 67 percent or
more of the voting shares of the affected Fund present at the meeting, if the
holders of more than 50 percent of the outstanding voting shares of that Fund
are present or represented by proxy, or (b) more than 50 percent of the
outstanding voting shares of that Fund. Abstentions and broker non-votes will
have the practical effect of a "No" vote if adoption of each of Proposals 2(a) -
(d) and Proposal 3 is to be determined pursuant to item (a) and will have no
effect on the outcome of the vote if adoption is to be determined pursuant to
item (b).

Approval of Proposal 4 for a Fund will require the affirmative vote of a
majority of the shares of that Fund represented at the Meeting in person or by
proxy, if a quorum is present. Abstentions and broker non-votes will have the
practical effect of a "No" vote on Proposal 4.

If a quorum is not present in person or by proxy at the meeting, or if a
quorum is present at the meeting but not enough votes to approve a proposal are
received, the persons named as proxies may propose one or more adjournments of
the meeting to permit further solicitation of proxies. Any proposal for
adjournment for a Fund will require the vote of a majority of the shares of that
Fund represented at the meeting in person or by proxy. A vote may be taken on
one of the proposals in this proxy statement before adjournment if a quorum is
present and sufficient votes have been received for approval.

15
<PAGE>

OTHER MATTERS

The board of trustees of Acorn knows of no other matters that are intended
to be brought before the meeting. If other matters are presented for action,
the proxies named in the enclosed form of proxy will vote on those matters in
their sole discretion.

SHAREHOLDER PROPOSALS

Acorn is not required, and does not intend, to hold annual meetings of
shareholders. Therefore, no date can be given by which a proposal by a
shareholder for consideration at such a meeting must be submitted. Any such
proposal should be submitted in writing to the Secretary of the Trust at its
principal offices at 227 West Monroe Street, Suite 3000, Chicago, Illinois
60606-5016. Upon submitting a proposal, the shareholder shall provide the Trust
with a written notice which includes the shareholder's name and address, the
number of shares of each Fund that such shareholder holds of record or
beneficially, the dates upon which such shares were acquired, and documentary
support for a claim of beneficial ownership.

By order of the Board of Trustees,

Steven A. Radis
Secretary

August [16], 1999

16
<PAGE>

VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE THE EXPENSE OF ADDITIONAL MAILINGS

Please fold and detach card at perforation before mailing

This proxy when properly executed will be voted in the manner directed herein by
the undersigned shareholder. If no direction is made, this proxy will be voted
FOR Proposal 1, FOR Proposal 2(a-d), and FOR Proposal 3 and 4, in the sole
discretion of the Proxies upon such other business as may properly come before
the meeting or any adjournment or adjournments thereof.

The board of trustees recommends a Vote FOR Proposals 1, 2(a)-(d), 3 and 4.
Please vote by filling in the appropriate boxes below.

1. Election of Trustees:

(01) Leo A. Guthart, (02) Irving B. Harris, (03) Jerome Kahn, Jr., (04)
Steven N. Kaplan, (05) David C. Kleinman, (06) James H. Lorie, (07) Charles P.
McQuaid, (08) Roger S. Meier, (09) Allan B. Muchin, (10) Robert E. Nason, (11)
Katherine Schipper, (12) Ralph Wanger

FOR ALL _____ WITHHOLD _____

To withhold authority to vote for any individual nominee, write that nominee(s)
name on the line below.

_______________________________________________________________________________

2a. Elimination of restriction regarding ownership of securities of issuers in
which affiliates of the Trust have invested (Acorn Fund only)