FORTIS EQUITY PORTFOLIOS INC, N-14AE, 1998-08-14

FORTIS EQUITY PORTFOLIOS INC
N-14AE, 1998-08-14

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<PAGE>
Registration No. 2-11387

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 14, 1998

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

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

FORM N-14

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

Pre-Effective Amendment No. / /
Post-Effective Amendment No. / /
(Check appropriate box or boxes)

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Exact name of Registrant as Specified in Charter:

FORTIS EQUITY PORTFOLIOS, INC.

Area Code and Telephone Number:

(612) 738-4000

Address of Principal Executive Offices:

500 Bielenberg Drive
Woodbury, Minnesota 55125

Name and Address of Agent for Service:

Scott R. Plummer, Esq., Assistant Secretary
Fortis Equity Portfolios, Inc.
500 Bielenberg Drive
Woodbury, Minnesota 55125

COPY TO:

Kathleen L. Prudhomme, Esq.
Dorsey & Whitney LLP
Pillsbury Center South
220 South Sixth Street
Minneapolis, Minnesota 55402

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

Title of Securities Being Registered:
Common Stock
(No filing fee is required because of reliance by the
Registrant on Section 24(f)of the Investment Company Act of 1940.)

It is proposed that this filing become effective on
September 14, 1998, pursuant to Rule 488.

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<PAGE>

FORTIS EQUITY PORTFOLIOS, INC.

REGISTRATION STATEMENT ON FORM N-14

CROSS REFERENCE SHEET
(AS REQUIRED BY RULE 481(a))

PART A OF FORM N-14 PROSPECTUS/PROXY STATEMENT CAPTION
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<S> <C>
1 Beginning of Registration Statement
and Outside Front Cover Page of Prospectus . . . . . . . Cross Reference Sheet and Cover Page

2. Beginning and Outside Back Cover Page
of Prospectus. . . . . . . . . . . . . . . . . . . . . . Table of Contents

3. Synopsis Information and Risk Factors. . . . . . . . . . Summary; Risk Factors

4. Information about the Transaction. . . . . . . . . . . . Summary; Information About the Reorganization; Voting Information

5. Information about the Registrant . . . . . . . . . . . . Inside Front Cover; Incorporation by Reference; Summary;
Information About Fiduciary Fund and Capital Fund

6. Information about the Company being
Acquired . . . . . . . . . . . . . . . . . . . . . . . . Incorporation by Reference; Summary; Information About Fiduciary
Fund and Capital Fund

7. Voting Information . . . . . . . . . . . . . . . . . . . Summary; Information About the Reorganization; Voting Information

8. Interest of Certain Persons and Experts. . . . . . . . . Voting Information

9. Additional Information . . . . . . . . . . . . . . . . . Not Applicable

STATEMENT OF ADDITIONAL
PART B OF FORM N-14 INFORMATION CAPTION
- ------------------- -----------------------

10. Cover Page . . . . . . . . . . . . . . . . . . . . . . . Cover Page

11. Table of Contents. . . . . . . . . . . . . . . . . . . . Not Applicable

12. Additional Information about the Registrant. . . . . . . Cover Page (Incorporation by Reference)

13. Additional Information about the Company
Being Acquired . . . . . . . . . . . . . . . . . . . . . Cover Page (Incorporation by Reference)

14. Financial Statements . . . . . . . . . . . . . . . . . . Financial Statements

PART C OF FORM N-14
- -------------------

Information required to be included in Part C is set forth under the appropriate item in Part C of this Registration Statement.
</TABLE>

<PAGE>

FORTIS EQUITY PORTFOLIOS, INC.
REGISTRATION STATEMENT ON FORM N-14

PART A

PRESIDENT'S LETTER

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

PROSPECTUS/PROXY STATEMENT

PROSPECTUS DATED JANUARY 1, 1998 OF FORTIS STOCK FUNDS
[TO BE DELIVERED WITH PROSPECTUS/PROXY STATEMENT]

ANNUAL REPORT OF FORTIS STOCK FUNDS
FOR THE FISCAL YEAR ENDED AUGUST 31, 1997
[TO BE DELIVERED WITH PROSPECTUS/PROXY STATEMENT]

SEMI-ANNUAL REPORT OF FORTIS STOCK FUNDS
FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 1998
[TO BE DELIVERED WITH PROSPECTUS/PROXY STATEMENT]

<PAGE>
FORTIS FIDUCIARY FUND, INC. , 1998

To the Shareholders of Fortis Fiduciary Fund, Inc.:

Enclosed with this letter is a proxy voting ballot, a Prospectus/Proxy
Statement and related information concerning a special meeting of shareholders
of Fortis Fiduciary Fund, Inc. ("Fiduciary Fund") to be held on ,
, 1998. The purpose of this special meeting is to submit to
shareholders of Fiduciary Fund a proposal to combine that Fund with and into
Fortis Capital Fund ("Capital Fund"), a series of Fortis Equity Portfolios,
Inc., by means of the reorganization described in the Prospectus/Proxy
Statement.

If the proposed combination of Funds is approved, you will receive Capital
Fund shares having an aggregate net asset value equal to the aggregate net asset
value of your Fiduciary Fund shares at the effective time of the reorganization.
You will receive the same class of shares of Capital Fund as you hold in
Fiduciary Fund at the time of the reorganization.

Fortis Advisers, Inc. acts as the investment adviser, transfer agent, and
dividend disbursing agent for both Fiduciary Fund and Capital Fund. In addition,
the same individual at Fortis Advisers manages both Funds. As described in the
Prospectus/Proxy Statement, the investment advisory and management fee schedule
of Capital Fund is the same as that of Fiduciary Fund. However, as a result of
the larger size of Capital Fund relative to Fiduciary Fund, Capital Fund
currently pays, and after the reorganization will pay, a lower investment
advisory and management fee than Fiduciary Fund currently pays.

At June 30, 1998, Fiduciary Fund had net assets of approximately $104.2
million, while Capital Fund had net assets of approximately $414.7 million.
Fiduciary Fund's Board of Directors believes that the proposed combination of
Funds is in the best interests of Fiduciary Fund shareholders because, among
other things, it is expected to significantly lower the total expense ratio
experienced by such shareholders due to the economies of scale associated with
becoming part of a larger Fund, as described at pages 5-8 of the
Prospectus/Proxy Statement.

The Funds have identical investment objectives which seek to provide
shareholders with short and long-term capital appreciation. The Funds also have
identical investment policies and restrictions, with the exception of the
targeted median market capitalizations of their portfolios. Despite this
difference, however, the median market capitalizations of the Funds were nearly
identical as of June 30, 1998. The investment objectives, policies and
restrictions of the Funds, as well as other important information concerning the
proposed combination of the Funds, are described in detail in the
Prospectus/Proxy Statement, which you are encouraged to review carefully. If you
have any additional questions, please call your registered representative, or
Fiduciary Fund directly at 1-800-800-2000, Ext. 3012.

Fiduciary Fund's Board of Directors has approved the proposed combination of
Funds and recommends it for your approval. I encourage you to vote "FOR" the
proposal, and ask that you please send your completed proxy ballot in as soon as
possible to help save the cost of additional solicitations. As always, we thank
you for your confidence and support.

Sincerely,

[SIGNATURE]

Dean C. Kopperud
PRESIDENT
<PAGE>
FORTIS FIDUCIARY FUND, INC.
500 BIELENBERG DRIVE, WOODBURY, MINNESOTA 55125

MAILING ADDRESS: P.O. BOX 64284, ST. PAUL, MINNESOTA 55164

(651) 738-4020

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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD , 1998

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

To the Shareholders of Fortis Fiduciary Fund, Inc.: , 1998

NOTICE IS HEREBY GIVEN that a special meeting of shareholders of Fortis
Fiduciary Fund, Inc. ("Fiduciary Fund") will be held at 10:00 a.m., Central
time, on , , 1998, at the offices of Fortis Advisers,
Inc., 500 Bielenberg Drive, Woodbury, Minnesota. The purpose of the special
meeting is as follows:

1. To consider and vote on a proposed Agreement and Plan of Reorganization
(the "Plan") providing for (a) the acquisition of substantially all of
the assets and the assumption of all liabilities of Fiduciary Fund by
Fortis Capital Fund ("Capital Fund"), a separately managed series of
Fortis Equity Portfolios, Inc., in exchange for shares of common stock of
Capital Fund having an aggregate net asset value equal to the aggregate
value of the assets acquired (less the liabilities assumed) of Fiduciary
Fund and (b) the liquidation of Fiduciary Fund and the pro rata
distribution of Capital Fund shares to Fiduciary Fund shareholders. Under
the Plan, Fiduciary Fund shareholders will receive the same class of
shares of Capital Fund that they held in Fiduciary Fund, having a net
asset value equal as of the effective time of the Plan to the net asset
value of their Fiduciary Fund shares.

2. To transact such other business as may properly come before the meeting
or any adjournments or postponements thereof.

Even if Fiduciary Fund shareholders vote to approve the Plan, consummation
of the Plan is subject to certain other conditions. See "Information About the
Reorganization--Plan of Reorganization" in the attached Prospectus/Proxy
Statement.

THE BOARD OF DIRECTORS OF FIDUCIARY FUND RECOMMENDS APPROVAL OF THE PLAN.

The close of business on , 1998 has been fixed as the record date
for the determination of shareholders entitled to notice of and to vote at the
meeting and any adjournments or postponements thereof.

WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE SIGN AND PROMPTLY
RETURN THE ENCLOSED PROXY IN THE ENCLOSED POSTAGE-PREPAID ENVELOPE. IN ORDER TO
AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE RESPECTFULLY ASK FOR
YOUR COOPERATION IN MAILING IN YOUR PROXY PROMPTLY. If you are present at the
meeting, you may then revoke your proxy and vote in person, as explained in the
Prospectus/Proxy Statement in the section entitled "Voting Information."

By Order of the Board of Directors,

MICHAEL J. RADMER
SECRETARY
<PAGE>
PROSPECTUS/PROXY STATEMENT
DATED , 1998

ACQUISITION OF THE ASSETS OF

FORTIS FIDUCIARY FUND, INC.
500 BIELENBERG DRIVE, WOODBURY, MINNESOTA 55125
MAILING ADDRESS: P.O. BOX 64284, ST. PAUL, MINNESOTA 55164
(800) 800-2000, EXT. 3012

BY AND IN EXCHANGE FOR SHARES OF

FORTIS CAPITAL FUND
A SEPARATELY MANAGED SERIES OF
FORTIS EQUITY PORTFOLIOS, INC.
500 BIELENBERG DRIVE, WOODBURY, MINNESOTA 55125
MAILING ADDRESS: P.O. BOX 64284, ST. PAUL, MINNESOTA 55164
(800) 200-2000, EXT. 3012

This Prospectus/Proxy Statement is being furnished to the shareholders of
Fortis Fiduciary Fund, Inc. ("Fiduciary Fund") in connection with a special
meeting (the "Meeting") of the shareholders of Fiduciary Fund to be held at the
offices of Fortis Advisers, Inc., 500 Bielenberg Drive, Woodbury, Minnesota, on
, , 1998, for the purposes set forth in the accompanying
Notice of Special Meeting of Shareholders. This Prospectus/Proxy Statement is
first being mailed to shareholders of Fiduciary Fund on or about ,
1998. Information concerning the voting rights of each Fiduciary Fund
shareholder is set forth under "Voting Information" below. Representatives of
Fortis Advisers, Inc., the investment adviser and manager of Fiduciary Fund, or
of its affiliates, may, without cost to Fiduciary Fund, solicit proxies for
management of Fiduciary Fund by means of mail, telephone, or personal calls.
Persons holding shares as nominees will, upon request, be reimbursed for their
reasonable expenses incurred in sending proxy soliciting materials on behalf of
the Board of Directors to their principals.

As set forth in the Notice of Special Meeting of Shareholders, this
Prospectus/Proxy Statement relates to a proposed Agreement and Plan of
Reorganization (the "Plan") providing for (i) the acquisition of substantially
all the assets and the assumption of all liabilities of Fiduciary Fund by Fortis
Capital Fund ("Capital Fund"), a separately managed series of Fortis Equity
Portfolios, Inc. in exchange for shares of common stock of Capital Fund having
an aggregate net asset value equal to the aggregate value of the assets acquired
(less liabilities assumed) of Fiduciary Fund, and (ii) the liquidation of
Fiduciary Fund and the pro rata distribution of its holdings of Capital Fund
shares to Fiduciary Fund shareholders. Fiduciary Fund and Capital Fund are
sometimes referred to herein, individually, as a "Fund," or together, as the
"Funds."
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE
<PAGE>
As a result of the transactions contemplated by the Plan (collectively, the
"Reorganization"), each shareholder of Fiduciary Fund will receive Capital Fund
shares of the same class that he or she held in Fiduciary Fund, with an
aggregate net asset value equal as of the effective time of the Plan to the
aggregate net asset value of their Fiduciary Fund shares. The Reorganization is
being structured as a tax-free reorganization so that no income, gain or loss
will be recognized by Fiduciary Fund or its shareholders as a result thereof
(except that Fiduciary Fund contemplates that it will make a distribution,
immediately prior to the Reorganization, of all of its current year net income
and net realized capital gains, if any, not previously distributed, and this
distribution will be taxable to Fiduciary Fund shareholders subject to
taxation). The shareholders of Fiduciary Fund are being asked to vote on the
proposed Plan and Reorganization at the Meeting.

In addition to the approval of the Plan and Reorganization by Fiduciary Fund
shareholders, the consummation of the Reorganization is subject to certain other
conditions. See "Information About the Reorganization--Plan of Reorganization."

Fiduciary Fund and Capital Fund are both diversified, open-end funds with an
investment objective of short and long-term capital appreciation. For each Fund,
current income is only a secondary objective. Both Funds invest primarily in
equity securities and select stocks based on their growth potential. The Funds
have identical investment policies and restrictions, with the exception of the
targeted median market capitalizations of their portfolios. Under normal market
conditions, Capital Fund intends to maintain a median market capitalization for
its portfolio of over $5 billion, and Fiduciary Fund intends to maintain a
median market capitalization of over $1 billion. However, the current median
market capitalizations of the Funds are nearly identical. As of June 30, 1998,
Fiduciary Fund and Capital Fund each had median market capitalizations of
approximately $10.6 billion.

The Funds' investment objectives, policies and restrictions are described
and compared below under "Information About Fiduciary Fund and Capital
Fund--Comparison of Investment Objectives, Policies and Restrictions."

Fortis Advisers, Inc. ("Advisers") serves as the investment adviser,
transfer agent and dividend agent to both Fiduciary Fund and Capital Fund. In
addition, the same individual at Advisers manages both Funds.

This Prospectus/Proxy Statement, which should be retained for future
reference, sets forth concisely the information about the proposed Plan and
Reorganization and about Capital Fund and its affiliates that each Fiduciary
Fund shareholder should know prior to voting on the proposed Plan and
Reorganization.

INCORPORATION BY REFERENCE

The document listed in item 1 below, which has been filed with the
Securities and Exchange Commission (the "Commission"), is incorporated herein by
reference to the extent noted below. A Statement of Additional Information dated
, 1998 relating to this Prospectus/Proxy Statement has been filed
with the Commission and is also incorporated by reference into this
Prospectus/Proxy Statement. A copy of the Statement of Additional Information is
available upon request and without charge by writing to Capital Fund at P.O. Box
64284, St. Paul, Minnesota 55164, or by calling (800) 800-2000, Ext. 3012 or
3014. The documents listed in items 2, 3 and 4 below are incorporated by
reference into the Statement of Additional Information and such items will be
provided with any copy of the Statement of Additional Information which is
requested. Any documents requested will be sent within one business day of
receipt of the request by first class mail or other means designed to ensure
equally prompt delivery.

1. The Prospectus dated January 1, 1998 of Fiduciary Fund and Capital Fund
is incorporated herein in its entirety by reference, and a copy thereof
accompanies this Prospectus/Proxy Statement.

2
<PAGE>
2. The Annual Report of Fiduciary Fund and Capital Fund for the fiscal year
ended August 31, 1997 is incorporated by reference in its entirety in the
Statement of Additional Information relating to this Prospectus/Proxy
Statement, and a copy thereof accompanies this Prospectus/Proxy
Statement.

3. The Semi-Annual Report of Fiduciary Fund and Capital Fund for the
six-month period ended February 28, 1998 is incorporated by reference in
its entirety in the Statement of Additional Information relating to this
Prospectus/Proxy Statement.

4. The Statement of Additional Information dated January 1, 1998 of
Fiduciary Fund and Capital Fund is incorporated by reference in its
entirety in the Statement of Additional Information relating to this
Prospectus/Proxy Statement.

Also accompanying and attached to this Prospectus/Proxy Statement as Exhibit
A is a copy of the Plan for the proposed Reorganization.

3
<PAGE>
SUMMARY

This summary is qualified in its entirety by reference to the additional
information contained elsewhere in this Prospectus/Proxy Statement and in the
documents incorporated by reference herein, and by reference to the Plan, a copy
of which is attached to this Prospectus/Proxy Statement as Exhibit A. Fiduciary
Fund shareholders should review the accompanying documents carefully in
connection with their review of this Prospectus/Proxy Statement.

PROPOSED REORGANIZATION

The Plan provides for (i) the acquisition of substantially all of the assets
and the assumption of all liabilities of Fiduciary Fund by Capital Fund in
exchange for shares of common stock of Capital Fund having an aggregate net
asset value equal to the aggregate value of the assets acquired (less
liabilities assumed) of Fiduciary Fund and (ii) the liquidation of Fiduciary
Fund and the pro rata distribution of its holdings of Capital Fund shares to
Fiduciary Fund shareholders as of the effective time of the Reorganization (the
close of normal trading on the New York Stock Exchange, currently 4:00 p.m.
Eastern Time, on , 1998, or such later date as provided for in the
Plan) (such time and date, the "Effective Time"). As a result of the
Reorganization, each shareholder of Fiduciary Fund will receive Capital Fund
shares of the same class that he or she held in Fiduciary Fund, with an
aggregate net asset value equal to the aggregate net asset value of the
shareholder's Fiduciary Fund shares as of the Effective Time. See "Information
About the Reorganization."

For the reasons set forth below under "Information About the
Reorganization--Reasons for the Reorganization," the Board of Directors of
Fiduciary Fund, including all of the "non-interested" Directors, as that term is
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act"), has concluded that the Reorganization would be in the best
interests of the shareholders of Fiduciary Fund and that the interests of
Fiduciary Fund's existing shareholders would not be diluted as a result of the
transactions contemplated by the Reorganization. Therefore, the Board of
Directors has approved the Reorganization and has submitted the Plan for
approval by Fiduciary Fund shareholders.

The Board of Directors of Capital Fund has also concluded that the
Reorganization would be in the best interests of Capital Fund's existing
shareholders and has therefore approved the Reorganization on behalf of Capital
Fund.

Approval of the Plan and Reorganization will require the affirmative vote of
a majority of the outstanding shares of each class of Fiduciary Fund, voting as
separate classes.

TAX CONSEQUENCES

Prior to completion of the Reorganization, Fiduciary Fund will have received
from counsel an opinion that, upon the Reorganization, no gain or loss will be
recognized by Fiduciary Fund or its shareholders for federal income tax
purposes. The holding period and aggregate tax basis of Capital Fund shares that
are received by each Fiduciary Fund shareholder will be the same as the holding
period and aggregate tax basis of Fiduciary Fund shares previously held by such
shareholders. In addition, the holding period and tax basis of the assets of
Fiduciary Fund in the hands of Capital Fund as a result of the Reorganization
will be the same as in the hands of Fiduciary Fund immediately prior to the
Reorganization. See "Information About the Reorganization--Federal Income Tax
Consequences."

INVESTMENT OBJECTIVES, POLICIES AND RESTRICTIONS

4
<PAGE>
median market capitalization for its portfolio of over $5 billion, and Fiduciary
Fund intends to maintain a median market capitalization of over $1 billion.
However, the current median market capitalizations of the Funds are nearly
identical. As of June 30, 1998, Fiduciary Fund and Capital Fund each had median
market capitalizations of approximately $10.6 billion.

The Semi-Annual Report of Fiduciary Fund and Capital Fund for the six-month
period ended February 28, 1998, referred to on the cover page hereof under
"Incorporation by Reference," provides information concerning the composition of
the respective Funds' assets at such date.

FEES AND EXPENSES

ADVISORY FEES. Fiduciary Fund and Capital Fund have separate agreements
with Advisers pursuant to which they pay Advisers investment advisory and
management fees for managing their respective investment portfolios. The
investment advisory fees for the two Funds are calculated as a percentage of
Fund net assets pursuant to the same schedule, as follows:

<TABLE>
<CAPTION>
ANNUAL
INVESTMENT ADVISORY
AVERAGE NET ASSETS AND MANAGEMENT FEE
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<S> <C>
For the first $100 million............................................... 1.0%
For the next $150 million................................................ .8%
For assets over $250 million............................................. .7%
</TABLE>

At June 30, 1998, Fiduciary Fund had net assets of approximately $104.2
million, while Capital Fund had net assets of approximately $414.7 million.
Thus, due to "breakpoints" in the advisory fee schedule and the greater size of
Capital Fund, it is anticipated that Fiduciary Fund shareholders will experience
lower advisory fees as a percentage of net assets as a result of the proposed
Reorganization. See "Pro Forma Fees and Expenses" below.

SALES CHARGES AND RULE 12B-1 FEES. The sales charge schedules and Rule
12b-1 fees for the Funds are identical. Fortis Investors, Inc. ("Investors"), a
subsidiary of Advisers, acts as each Fund's principal underwriter pursuant to an
Underwriting Agreement. Under each Underwriting Agreement, Investors retains the
sales charges, if any, paid by Class A shareholders in connection with their
purchases of Fund shares and is entitled to deduct a contingent deferred sales
charge on the redemption of Class B, C and H shares (and on the redemption of
certain Class A shares initially sold without a sales charge). In addition, each
Fund has adopted a Plan of Distribution pursuant to Rule 12b-1 under the 1940
Act. Pursuant to these Plans, each Fund pays Investors a Rule 12b-1 fee at an
annual rate of .25% of the Fund's average daily net assets attributable to Class
A shares and 1% of the Fund's average daily net assets attributable to each of
Class B, C and H shares for providing certain services to shareholders and for
distribution related services. Additional information on sales charges and Rule
12b-1 fees is set forth in the accompanying Prospectus of Capital Fund and
Fiduciary Fund under the caption "How to Buy Fund Shares."

PRO FORMA FEES AND EXPENSES

The following tables are intended to assist Fiduciary Fund shareholders of
each class in understanding the various costs and expenses (expressed as a
percentage of average net assets) (i) that such shareholders currently bear as
Fiduciary Fund shareholders (under the "Fiduciary Fund" column); (ii) that
shareholders of Capital Fund currently bear (under the "Capital Fund" column);
and (iii) that such shareholders can expect to bear as Capital Fund shareholders
after the Reorganization is consummated (under the "Pro Forma" column). The
examples set forth below should not be considered representations of past or
future expenses or performance, and actual expenses may be greater or less than
those shown. The following tables reflect each Fund's actual expenses for the
fiscal year ended August 31, 1997.

5
<PAGE>
CLASS A SHARES FEES AND EXPENSES

<TABLE>
<CAPTION>
FIDUCIARY CAPITAL
FUND FUND PRO FORMA
----------- ----------- ------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as a percentage of
offering price)................................................................ 4.75%* 4.75%* 4.75%*
Maximum Deferred Sales Charge (as a percentage of original purchase
price or redemption proceeds, as applicable)................................... None** None ** None **

ANNUAL FUND OPERATING EXPENSES (AS A % OF AVERAGE NET ASSETS)
Management Fees.................................................................. 1.00 % 0.84 % 0.81 %
Rule 12b-1 Fees.................................................................. 0.25 % 0.25 % 0.25 %
Other Expenses................................................................... 0.16 % 0.09 % 0.08 %
----- ----- -----
Total Fund Operating Expenses.................................................... 1.41 % 1.18 % 1.14 %

Example
You would pay the following expenses on a $1,000 investment over various time periods assuming: (1) 5%
annual return; and (2) redemption at the end of each time period:
1 year........................................................................... $ 61 $ 59 $ 59
3 years.......................................................................... $ 90 $ 83 $ 82
5 years.......................................................................... $ 121 $ 109 $ 107
10 years......................................................................... $ 209 $ 184 $ 180
</TABLE>

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* Since each Fund also pays an asset-based sales charge, long-term shareholders
may pay more than the economic equivalent of the maximum front end sales
charge permitted by NASD rules.

** A contingent deferred sales charge of 1.00% is imposed on certain redemptions
of Class A shares that were purchased without an initial sales charge as part
of an investment of $1 million or more. See "How to Buy Shares--Class A
Shares" in the accompanying Prospectus of Capital Fund and Fiduciary Fund.

6
<PAGE>
CLASS B AND H SHARES FEES AND EXPENSES

<TABLE>
<CAPTION>
FIDUCIARY CAPITAL
FUND FUND PRO FORMA
----------- ----------- ------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as a percentage of offering price).... None* None * None *
Maximum Deferred Sales Charge (as a percentage of original purchase price or
redemption proceeds, as applicable).............................................. 4.00 % 4.00 % 4.00 %

ANNUAL FUND OPERATING EXPENSES (AS A % OF AVERAGE NET ASSETS)
Management Fees.................................................................. 1.00 % 0.84 % 0.81 %
Rule 12b-1 Fees.................................................................. 1.00 % 1.00 % 1.00 %
Other Expenses................................................................... 0.16 % 0.09 % 0.08 %
----- ----- -----
Total Fund Operating Expenses.................................................... 2.16 % 1.93 % 1.89 %

Example
You would pay the following expenses on a $1,000 investment over various time periods assuming: (1) 5% annual return; and
(2) both redemption and no redemption at the end of each time period:

With Redemption
1 year........................................................................... $ 58 $ 56 $ 55
3 years.......................................................................... $ 95 $ 88 $ 86
5 years.......................................................................... $ 134 $ 122 $ 120
10 years......................................................................... $ 230 $ 206 $ 202

Without Redemption
1 year........................................................................... $ 22 $ 20 $ 19
3 years.......................................................................... $ 68 $ 61 $ 59
5 years.......................................................................... $ 116 $ 104 $ 102
10 years......................................................................... $ 230 $ 206 $ 202
</TABLE>

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

* Shares are sold without a front end sales charge, but their contingent
deferred sales charge and Rule 12b-1 fees may cause long-term shareholders to
pay more than the economic equivalent of the maximum permitted front end
sales charge.

7
<PAGE>
CLASS C SHARES FEES AND EXPENSES

<TABLE>
<CAPTION>
FIDUCIARY CAPITAL
FUND FUND PRO FORMA
----------- ----------- ------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as a percentage of
offering price)................................................................ None* None * None *
Maximum Deferred Sales Charge (as a percentage of original purchase
price or redemption proceeds, as applicable)................................... 1.00 % 1.00 % 1.00 %

ANNUAL FUND OPERATING EXPENSES (AS A % OF AVERAGE NET ASSETS)
Management Fees.................................................................. 1.00 % 0.84 % 0.81 %
Rule 12b-1 Fees.................................................................. 1.00 % 1.00 % 1.00 %
Other Expenses................................................................... 0.16 % 0.09 % 0.08 %
----- ----- -----
Total Fund Operating Expenses.................................................... 2.16 % 1.93 % 1.89 %

Example
You would pay the following expenses on a $1,000 investment over various time periods assuming: (1) 5% annual return; and
(2) both redemption and no redemption at the end of each time period:

With Redemption
1 year........................................................................... $ 32 $ 30 $ 29
3 years.......................................................................... $ 68 $ 61 $ 59
5 years.......................................................................... $ 116 $ 104 $ 102
10 years......................................................................... $ 249 $ 225 $ 221

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

PURCHASE, EXCHANGE AND REDEMPTION PROCEDURES

Each class of shares of Capital Fund received by Fiduciary Fund shareholders
in the Reorganization will be subject to the same purchase, exchange and
redemption procedures that currently apply to Fiduciary Fund shares of such
class. These procedures are discussed in the accompanying Prospectus of Capital
Fund and Fiduciary Fund under the captions "How to Buy Fund Shares" and
"Redemption."

DIVIDENDS AND DISTRIBUTIONS

Each Fund pays annual dividends from net investment income and distributes
any realized capital gains annually. Dividends and capital gains distributions
for each Fund are made in the form of additional shares of the same Fund and the
same class (at net asset value) unless the shareholder sends the Fund a written
request that either or both be sent to the shareholder or reinvested (at net
asset value) in shares of the same class of another Fortis fund.

8
<PAGE>
CAPITAL STOCK; SHAREHOLDER VOTING RIGHTS

Each Fund offers Class A, Class B, Class C and Class H shares. Each class of
shares of a Fund represents interests in the assets of the applicable Fund and
has identical voting, dividend, liquidation, and other rights on the same terms
and conditions except that expenses related to the distribution of a class of
shares are borne solely by such class and each class of a Fund's shares has
exclusive voting rights with respect the provisions of such Fund's Rule 12b-1
plan which pertain to that particular class and other matters for which separate
class voting is appropriate under applicable law. Capital Fund may offer
additional classes of shares in the future.

RISK FACTORS

With the exception of the Funds' targeted median market capitalizations, the
investment objectives, policies and restrictions of Fiduciary Fund and Capital
Fund are identical (see "Information About Fiduciary Fund and Capital
Fund--Comparison of Investment Objectives, Policies and Restrictions" below). As
a result, the risks associated with investing in both Funds are very similar.
Because both Funds invest primarily in common stocks and securities convertible
into common stocks, both Funds are subject to market risk--i.e., the possibility
that stock prices in general will decline over short or even extended periods.
The stock market tends to be cyclical, with periods when stock prices generally
rise and periods when stock prices generally decline.

Each Fund may invest up to 10% of its total assets (at the time of
investment) in foreign securities. Investing in foreign companies involves
certain risks which are not typically associated with investing in the
securities of United States issuers. Since the Funds may invest in securities
denominated in currencies other than U.S. dollars, and since they may
temporarily hold funds in bank deposits or other money market investments
denominated in foreign currencies, they may be affected favorably or unfavorably
by exchange control regulations or changes in the exchange rate between such
currencies and the dollar. Moreover, there may be less publicly available
information about foreign issuers than about domestic issuers , and foreign
issuers may not be subject to accounting, auditing and financial reporting
standards and requirements comparable to those of domestic issuers. 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 United States investments in those countries.
Securities of some foreign companies are less liquid and their prices are more
volatile than securities of comparable domestic companies. Moreover, certain
foreign countries are known to experience long delays between the trade and
settlement dates of securities purchased and sold. The risk of investing in
foreign securities are discussed more fully in the accompanying Prospectus of
Capital Fund and Fiduciary Fund under the caption "Investment Objectives and
Policies--Other Investment Practices of the Funds--Foreign Securities."

Each Fund may invest in equity or debt real estate investment trusts
("REITs"), real estate development and real estate operating companies, and
other real estate related businesses. The Funds intend to invest the REIT
portions of their portfolios primarily in equity REITs, which are trusts that
sell shares to investors and use the proceeds to invest in real estate or
interests in real estate. The Funds' investments in REITs may be subject to
certain of the same risks associated with the direct ownership of real estate.
These risks include: declines in the value of real estate; risks related to
general and local economic conditions; overbuilding and competition; increases
in property taxes and operating expenses; and variations in rental income. In
addition, REITs may not be diversified. REITs are subject to the possibility of
failing to qualify for tax-free pass through of income under the Internal
Revenue Code and failing to maintain exemption from the Investment Company Act.
Also, equity REITs may be dependent upon management skill and may be subject to
the risks of obtaining adequate financing for projects on favorable terms. Both
Funds limit their investments in REITs to 10% of total assets and to publicly
distributed REITs.

9
<PAGE>
The investment securities and techniques of the Funds, and the risks
associated therewith, are described in more detail in the Prospectus of Capital
Fund and Fiduciary Fund accompanying this Prospectus/Proxy Statement, and in the
Statement of Additional Information of the Funds referred to under
"Incorporation by Reference."

INFORMATION ABOUT THE REORGANIZATION

REASONS FOR THE REORGANIZATION

The Board of Directors of both Fiduciary Fund and Capital Fund, including
all of the "non-interested" directors, has determined that it is advantageous to
the respective Funds to combine Fiduciary Fund with Capital Fund. As discussed
in detail below under "Information About Fiduciary Fund and Capital Fund," the
Funds have identical investment objectives, policies and restrictions, with the
exception of the Funds' policies regarding the median market capitalizations of
their portfolios. The Funds also have the same investment adviser (with the same
individual managing both Funds) and the same underwriter, auditors, legal
counsel and custodian.

The Board of Directors of each Fund has determined that the Reorganization
is expected to provide certain benefits to its Fund and is in the best interests
of such Fund and its shareholders. The Board of Directors of each Fund has also
determined that the interests of the existing shareholders of its Fund will not
be diluted as a result of the Reorganization. The Boards considered, among other
things, the following factors in making such determinations:

(i) the advantages which may be realized by Fiduciary Fund and Capital
Fund, consisting of a potentially reduced expense ratio, economies of scale
resulting from fund growth, and facilitation of portfolio management. The
Boards noted in this regard that Capital Fund, with its much larger asset
base and resulting economies of scale, has a significantly lower expense
ratio than does the smaller Fiduciary Fund, and it is expected that holders
of Fiduciary Fund will benefit from this lower expense ratio;

(ii) the tax-free nature of the proposed Reorganization;

(iii) the terms and conditions of the Plan, including that (a) the
exchange of Fiduciary Fund shares for Capital Fund shares will take place on
a net asset value basis; and (b) no sales charge will be incurred by
Fiduciary Fund shareholders in connection with their acquisition of Capital
Fund shares in the Reorganization;

(iv) the provision of the Plan that expenses of the Reorganization will
be allocated between Fiduciary Fund and Capital Fund in proportion to their
relative net assets at the Effective Time; and

(v) the fact that Fiduciary Fund shareholders of each class would
continue to have the same Rule 12b-1 fees and sales charges and that
advisory fees for Fiduciary Fund shareholders should be reduced as a result
of "breakpoints" in the advisory fee schedule and the larger asset base of
Capital Fund.

The Board concluded that the factors noted in (i) through (v) above render
the proposed Reorganization fair to and in the best interests of shareholders of
Fiduciary Fund and Capital Fund.

PLAN OF REORGANIZATION

The following summary of the proposed Plan and the Reorganization is
qualified in its entirety by reference to the Plan attached to this
Prospectus/Proxy Statement as Exhibit A. The Plan provides that, as of the
Effective Time, Capital Fund will acquire all or substantially all of the assets
and assume all liabilities of Fiduciary Fund in exchange for Capital Fund shares
having an aggregate net asset value equal to the aggregate value of the assets
acquired (less liabilities assumed) from Fiduciary Fund. For corporate law
purposes the transaction is structured as a sale of the assets and assumption of
the liabilities of

10
<PAGE>
Fiduciary Fund in exchange for the issuance of Capital Fund shares to Fiduciary
Fund, followed immediately by the distribution of such Capital Fund shares to
Fiduciary Fund shareholders and the cancellation and retirement of outstanding
Fiduciary Fund shares.

Pursuant to the Plan, each holder of Class A, Class B, Class C or Class H
shares of Fiduciary Fund will receive, at the Effective Time, Class A, Class B,
Class C or Class H shares, respectively, of Capital Fund with an aggregate net
asset value equal to the aggregate net asset value of Fiduciary Fund shares
owned by such shareholder immediately prior to the Effective Time. The net asset
value per share of each Fund's Class A, Class B, Class C and Class H shares will
be computed as of the Effective Time using the valuation procedures set forth in
the respective Funds' articles of incorporation and bylaws and then-current
Prospectus and Statement of Additional Information and as may be required by the
Investment Company Act.

At the Effective Time, Capital Fund will issue to Fiduciary Fund, and
Fiduciary Fund will distribute to Fiduciary Fund's shareholders of record,
determined as of the Effective Time, the Capital Fund shares issued in exchange
for Fiduciary Fund assets as described above. All outstanding shares of
Fiduciary Fund thereupon will be canceled and retired and no additional shares
representing interests in Fiduciary Fund will be issued thereafter, and
Fiduciary Fund will be deemed to be liquidated. The distribution of Capital Fund
shares to former Fiduciary Fund shareholders will be accomplished by the
establishment of accounts on the share records of Capital Fund in the names of
Fiduciary Fund shareholders, each representing the numbers of full and
fractional Capital Fund Class A, Class B, Class C or Class H shares due such
shareholders.

The Plan provides that no sales charges will be incurred by Fiduciary Fund
shareholders in connection with the acquisition by them of Capital Fund shares
pursuant thereto. The Plan also provides that former holders of Fiduciary Fund
Class B, Class C or Class H shares who receive Capital Fund Class B, Class C or
Class H shares in the Reorganization will receive credit for the period they
held such Fiduciary Fund shares in determining the contingent deferred sales
charge on such Capital Fund shares and in determining the date upon which such
Capital Fund Class B or Class H shares convert to Capital Fund Class A shares.
In addition, the Plan provides that in applying the two-year 1% contingent
deferred sales charge on Class A shares with respect to which the front end
sales charge was waived, credit will be given for the period a former Fiduciary
Fund shareholder who is subject to such a contingent deferred sales charge held
his or her shares.

Fiduciary Fund and Capital Fund contemplate that they will each make a
distribution, immediately prior to the Effective Time, of all of their current
year net income and net realized capital gains, if any, not previously
distributed. This distribution will be taxable to shareholders subject to
taxation.

The consummation of the Reorganization is subject to the conditions set
forth in the Plan, including, among others: (i) approval of the Plan by the
shareholders of Fiduciary Fund; (ii) the delivery of the opinion of counsel
described below under "--Federal Income Tax Consequences;" (iii) the accuracy as
of the Effective Time of the representations and warranties made by Fiduciary
Fund and Capital Fund in the Plan; and (iv) the delivery of customary closing
certificates. See the Plan attached hereto as Exhibit A for a complete listing
of the conditions to the consummation of the Reorganization. The Plan may be
terminated and the Reorganization abandoned at any time prior to the Effective
Time, before or after approval by shareholders of Fiduciary Fund, by resolution
of the Board of Directors of either Fiduciary Fund or Capital Fund, if
circumstances should develop that, in the opinion of such Board, make proceeding
with the consummation of the Plan and Reorganization not in the best interests
of such Fund's shareholders.

The Plan provides that all expenses incurred in connection with the
Reorganization shall be allocated between and borne by Fiduciary Fund and
Capital Fund in proportion to their relative net assets at the Effective Time
and that such expenses, and the allocation thereof, shall be reflected in the
calculations of net asset values of the respective Funds for purposes of
determining the numbers of Capital Fund shares to be issued in the
Reorganization.

11
<PAGE>
Approval of the Plan will require the affirmative vote of a majority of the
outstanding shares of each class of Fiduciary Fund, voting as separate classes.
If the Plan is not approved, the Boards of Directors of the respective Funds
will consider other possible courses of action. Fiduciary Fund shareholders are
not entitled to assert dissenters' rights of appraisal in connection with the
Plan or Reorganization. See "Voting Information--No Dissenters' Rights of
Appraisal" below.

DESCRIPTION OF CAPITAL FUND SHARES

For information concerning the shares of capital stock of Capital Fund,
including voting rights, see "Summary--Capital Stock; Shareholder Voting Rights"
above. All Capital Fund shares issued in the Reorganization will by fully paid
and non-assessable and will not be entitled to pre-emptive or cumulative voting
rights.

FEDERAL INCOME TAX CONSEQUENCES

It is intended that the exchange of Capital Fund shares for Fiduciary Fund's
net assets and the distribution of such shares to Fiduciary Fund's shareholders
upon liquidation of Fiduciary Fund will be treated as a tax-free reorganization
under the Internal Revenue Code of 1986, as amended (the "Code"), and that, for
federal income tax purposes, no income, gain or loss will be recognized by
Fiduciary Fund's shareholders (except that Fiduciary Fund contemplates that it
will make a distribution, immediately prior to the Effective Time, of all of its
current year net income and net realized capital gains, if any, not previously
distributed, and this distribution will be taxable to Fiduciary Fund
shareholders subject to taxation). Fiduciary Fund has not asked, nor does it
plan to ask, the Internal Revenue Service to rule on the tax consequences of the
Reorganization.

As a condition to the closing of the Reorganization, the two Funds will
receive an opinion from Dorsey & Whitney LLP, counsel to the Funds, based in
part on certain representations to be furnished by each Fund, substantially to
the effect that the federal income tax consequences of the Reorganization will
be as follows:

(i) the Reorganization will constitute a reorganization within the
meaning of Section 368(a)(1)(C) of the Code, and Capital Fund and Fiduciary
Fund each will qualify as a party to the Reorganization under Section 368(b)
of the Code;

(ii) Fiduciary Fund shareholders will recognize no income, gain or loss
upon receipt, pursuant to the Reorganization, of Capital Fund shares.
Fiduciary Fund shareholders subject to taxation will recognize income upon
receipt of any net investment income or net capital gains of Fiduciary Fund
which are distributed by Fiduciary Fund prior to the Effective Time;

(iii) the tax basis of Capital Fund shares received by each Fiduciary
Fund shareholder pursuant to the Reorganization will be equal to the tax
basis of Fiduciary Fund shares exchanged therefor;

(iv) the holding period of Capital Fund shares received by each
Fiduciary Fund shareholder pursuant to the Reorganization will include the
period during which Fiduciary Fund shareholder held Fiduciary Fund shares
exchanged therefor, provided that Fiduciary Fund shares were held as a
capital asset at the Effective Time;

(v) Fiduciary Fund will recognize no income, gain or loss by reason of
the Reorganization;

(vi) Capital Fund will recognize no income, gain or loss by reason of
the Reorganization;

(vii) the tax basis of the assets received by Capital Fund pursuant to
the Reorganization will be the same as the basis of those assets in the
hands of Fiduciary Fund as of the Effective Time;

(viii) the holding period of the assets received by Capital Fund pursuant
to the Reorganization will include the period during which such assets were
held by Fiduciary Fund; and

12
<PAGE>
(ix) Capital Fund will succeed to and take into account the earnings and
profits, or deficit in earnings and profits, of Fiduciary Fund as of the
Effective Time.

Shareholders of Fiduciary Fund should consult their tax advisors regarding
the effect, if any, of the proposed Reorganization in light of their individual
circumstances. Since the foregoing discussion only relates to the federal income
tax consequences of the Reorganization, shareholders of Fiduciary Fund should
consult their tax advisors as to state and local tax consequences, if any, of
the Reorganization.

RECOMMENDATION AND VOTE REQUIRED

The Board of Directors of Fiduciary Fund, including the "non-interested"
directors, recommends that shareholders of Fiduciary Fund approve the Plan.
Approval of the Plan will require the affirmative vote of a majority of the
outstanding shares of each class of Fiduciary Fund, voting as separate classes.

INFORMATION ABOUT FIDUCIARY FUND AND CAPITAL FUND

Information concerning Capital Fund and Fiduciary Fund is incorporated
herein by reference from their current Prospectus dated January 1, 1998. Such
Prospectus accompanies this Prospectus/Proxy Statement and forms part of the
Registration Statements of Capital Fund and Fiduciary Fund on Form N-1A which
have been filed with the Commission.

Capital Fund and Fiduciary Fund are subject to the informational
requirements of the Securities Exchange Act of 1934 (the "Exchange Act") and in
accordance therewith file reports and other information including proxy
materials, reports and charter documents with the Commission. These proxy
materials, reports and other information filed by Capital Fund and Fiduciary
Fund can be inspected and copies obtained at the Public Reference Facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549
and at the New York Regional Office of the Commission at Seven World Trade
Center, 13th Floor, New York, New York 10048. Copies of such material can also
be obtained from the Public Reference Branch, Office of Consumer Affairs and
Information Services, Securities and Exchange Commission, Washington, D.C. 20549
at prescribed rates. In addition, the Commission maintains a World Wide Web site
that contains reports and information regarding issuers that file electronically
with the Commission. The address of such site is "http://www.sec.gov."

COMPARISON OF INVESTMENT OBJECTIVES, POLICIES AND RESTRICTIONS

GENERAL. Fiduciary Fund and Capital Fund are both diversified, open-end
funds with an investment objective of short and long-term capital appreciation.
For each Fund, current income is only a secondary objective. Both Funds invest
primarily in equity securities. For each Fund, Advisers invests based on a
concept of growth potential, seeking to identify companies whose earnings and
revenue growth potential exceed industry averages. In addition to superior
earnings growth potential, Advisers seeks companies which it believes to be well
managed with above average returns on equity and invested capital, healthy
balance sheets and the potential to gain market share.

Under normal market conditions, Capital Fund intends to maintain a median
market capitalization for its portfolio of greater than $5 billion and Fiduciary
Fund intends to maintain a median market capitalization for its portfolio of
greater than $1 billion. However, the current median market capitalizations of
the Funds are nearly identical. As of June 30, 1998, Fiduciary Fund and Capital
Fund each had median market capitalizations of approximately $10.6 billion.

Other than the Funds' targeted median market capitalizations, the investment
policies of Fiduciary Fund and Capital Fund are identical.

- Each Fund invests primarily in common stocks or securities convertible
into common stocks. Occasionally, however, limited amounts may be invested
in other types of securities (such as nonconvertible preferred and debt
securities).

13
<PAGE>
- Each Fund may invest up to 10% of its total assets in foreign securities.

- In periods when a more defensive position is deemed warranted, each Fund
may invest in high grade preferred stocks, bonds, other fixed income
securities (whether or not convertible into or carrying rights to purchase
common stock), short-term money market instruments, commercial paper,
obligations of banks or the U.S. Government, other high quality short-term
debt instruments or cash, all without limitation.

- Each Fund may invest in both listed and unlisted securities.

- Each Fund may invest up to 15% of its net assets in all forms of illiquid
investments.

- Each Fund may, to a limited extent, enter into options, futures and
forward contracts on a variety of investments and indexes, in order to
protect against declines in the value of portfolio securities or increases
in the cost of securities to be acquired ("hedging") and, in the case of
options on securities or indexes of securities, to increase a Fund's gross
income.

- Each Fund may invest in repurchase agreements.

- Each Fund may borrow money from banks as a temporary measure to facilitate
redemptions.

- Each Fund may invest in variable amount master demand notes.

- Each Fund may purchase securities on a "when issued" or delayed delivery
basis and purchase or sell securities on a "forward commitment" basis.

- Each Fund may lend its portfolio securities in an amount not to exceed
33 1/3% of the value of such Fund's total assets.

- Each Fund may invest in equity or debt real estate investment trusts, real
estate development and real estate operating companies, and other real
estate related businesses.

- Each Fund may sell a security short to the extent the Fund
contemporaneously owns or has the right to obtain equivalent securities.
Such a short sale is referred to as a short sale "against the box."

- Each Fund may at any time invest funds awaiting investment or held as
reserves for the purposes of satisfying redemption requests, payment of
dividends, making other distributions to shareholders, or for defensive
purposes, in cash and short-term money market instruments.

- Each Fund may invest in securities issued or guaranteed as to payment of
principal and interest by the U.S. government or its agencies or
instrumentalities.

- Consistent with its investment objectives, each Fund intends to purchase
securities primarily for investment, but also may seek short-term capital
appreciation. Each Fund reserves freedom of action, however, to sell
portfolio securities whenever management believes more favorable
investment opportunities are available, regardless of any additional
brokerage costs which may be incurred, and regardless of any income tax
consequences.

The foregoing comparison does not purport to be a complete summary of the
investment policies and restrictions of Fiduciary Fund or Capital Fund. For
complete discussions of the investment policies and restrictions of the
respective Funds, see the Prospectus of Capital Fund and Fiduciary Fund
accompanying this Prospectus/Proxy Statement and the Statement of Additional
Information of the Funds, referred to under "Incorporation by Reference."

14
<PAGE>
CAPITALIZATION

The following table shows the capitalization of Fiduciary Fund and of
Capital Fund as of February 28, 1998 and on a pro forma basis as of that date,
giving effect to the proposed Reorganization:

<TABLE>
<CAPTION>
FIDUCIARY CAPITAL
FUND FUND PRO FORMA
----------- --------- -----------
(In thousands, except per share
values)
<S> <C> <C> <C>
CLASS A SHARES
Net assets................................................ $ 83,520 $ 356,905 $ 440,425
Net asset value per share................................. $ 44.11 $ 24.42 $ 24.42
Shares outstanding........................................ 1,894 14,614 18,035

CLASS B SHARES
Net assets................................................ $ 3,955 $ 8,976 $ 12,931
Net asset value per share................................. $ 42.83 $ 23.81 $ 23.81
Shares outstanding........................................ 92 377 543

CLASS C SHARES
Net assets................................................ $ 1,092 $ 1,998 $ 3,090
Net asset value per share................................. $ 42.85 $ 23.81 $ 23.81
Shares outstanding........................................ 25 84 130

CLASS H SHARES
Net assets................................................ $ 8,216 $ 16,690 $ 24,906
Net asset value per share................................. $ 42.83 $ 23.83 $ 23.83
Shares outstanding........................................ 192 700 1,045
</TABLE>

VOTING INFORMATION

GENERAL

This Prospectus/Proxy Statement is furnished in connection with a
solicitation of proxies by the Board of Directors of Fiduciary Fund to be used
at the Special Meeting of Fiduciary Fund shareholders to be held at 10:00 a.m.,
Central time, on , 1998, at the offices of Fortis Advisers, Inc., 500
Bielenberg Drive, Woodbury, Minnesota and at any adjournments thereof. This
Prospectus/Proxy Statement, along with a Notice of Special Meeting and a proxy
card, is first being mailed to shareholders of Fiduciary Fund on or about
, 1998. Only shareholders of record as of the close of business on
, 1998 (the "Record Date") will be entitled to notice of, and to vote
at, the Meeting or any adjournment thereof. If the enclosed form of proxy is
properly executed and returned on time to be voted at the Meeting, the proxies
named therein will vote the shares represented by the proxy in accordance with
the instructions marked thereon. Unmarked proxies will be voted "for" the
proposed Plan and Reorganization. A proxy may be revoked by giving written
notice, in person or by mail, of revocation before the Meeting to Fiduciary Fund
at its principal executive offices, 500 Bielenberg Drive, Woodbury, Minnesota
(mailing address: P.O. Box 64284, St. Paul, Minnesota 55164) or by properly
executing and submitting a later-dated proxy, or by voting in person at the
Meeting.

If a shareholder executes and returns a proxy but abstains from voting, the
shares held by such shareholder will be deemed present at the Meeting for
purposes of determining a quorum and will be included in determining the total
number of votes cast. If a proxy is received from a broker or nominee indicating
that such person has not received instructions from the beneficial owner or
other person entitled to vote Fiduciary Fund shares (i.e., a broker "non-vote"),
the shares represented by such proxy will not be considered present at the
Meeting for purposes of determining a quorum and will not be included in
determining the number of votes cast. Brokers and nominees will not have
discretionary authority to vote shares for which instructions are not received
from the beneficial owner.

15
<PAGE>
Approval of the Plan and Reorganization will require the affirmative vote
described above under "Information About the Reorganization--Recommendation and
Vote Required."

As of , 1998 (i) Fiduciary Fund had the following number of shares
outstanding and entitled to vote at the Meeting: Class A, shares; Class B
shares; Class C, shares; and Class H, shares; (ii) Capital Fund
had the following numbers of shares outstanding: Class A, shares; Class B,
shares; Class C, shares; and Class H, shares; and (iii) the
directors and officers of the respective Funds as a group owned less than one
percent of the outstanding shares of each Fund or any class thereof. The
following table sets forth information concerning those persons known by the
respective Funds to own of record or beneficially more than 5% of the
outstanding shares of either Fund, or more than 5% of the outstanding shares of
any class of either Fund, as indicated, as of such date, including persons and
entities who beneficially own more than 25% of either Fund or any class thereof.
Unless otherwise indicated, the persons named below have both record and
beneficial ownership:

<TABLE>
<CAPTION>
PERCENTAGE
NAME AND ADDRESS OF RECORD HOLDER OWNERSHIP
- ---------------------------------------------------------------------------------- -------------
<S> <C>
FIDUCIARY FUND

CLASS A

CLASS B

CLASS C

CLASS H

CAPITAL FUND

CLASS A

CLASS B

CLASS C

CLASS H
</TABLE>

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

* Record ownership only.

Proxies are solicited by mail. Additional solicitations may be made by
telephone or personal contact by officers or employees of Advisers and its
affiliates without cost to the Funds. In addition, the services of a third-party
proxy solicitation firm may be utilized, with such firm's fees and expenses
allocated between and borne by Fiduciary Fund and Capital Fund as described
under "Information About the Reorganization--Plan of Reorganization" above.

In the event that sufficient votes to approve the Plan and Reorganization
are not received by the date set for the Meeting, the persons named as proxies
may propose one or more adjournments of the Meeting for up to 120 days to permit
further solicitation of proxies. In determining whether to adjourn the Meeting,
the following factors may be considered: the percentage of votes actually cast,
the percentage of negative votes actually cast, the nature of any further
solicitation and the information to be provided to shareholders with respect to
the reasons for the solicitation. Any such adjournment will require the
affirmative vote of a majority of the shares present in person or by proxy and
entitled to vote at the Meeting. The persons named as proxies will vote upon
such adjournment after consideration of the best interests of all shareholders.

16
<PAGE>
INTERESTS OF CERTAIN PERSONS

The following persons affiliated with the Funds receive payments from
Fiduciary Fund and Capital Fund for services rendered pursuant to contractual
arrangements with the Funds: Fortis Advisers, Inc., as the investment adviser,
transfer agent and dividend agent to each Fund, receives payments for its
investment advisory and management services; and Fortis Investors, Inc., a
subsidiary of Advisers, receives payments for providing distribution services to
each Fund.

NO DISSENTERS' RIGHTS OF APPRAISAL

Under the Investment Company Act, Fiduciary Fund shareholders are not
entitled to assert dissenters' rights of appraisal in connection with the Plan
of Reorganization.

FINANCIAL STATEMENTS AND EXPERTS

The audited statements of assets and liabilities, including the schedules of
investments in securities, of Fiduciary Fund and of Capital Fund as of August
31, 1997, and the related statements of operations for the year then ended, the
statements of changes in net assets for each of the periods indicated therein,
and the financial highlights for the periods indicated therein, as included in
the Annual Report of Fiduciary Fund and Capital Fund for the fiscal year ended
August 31, 1997, have been incorporated by reference into this Prospectus/Proxy
Statement in reliance on the reports of KPMG Peat Marwick LLP, independent
auditors for the Funds, given on the authority of such firm as experts in
accounting and auditing. In addition, the unaudited February 28, 1998 financial
statements of Fiduciary Fund and of Capital Fund, as included in the Semi-Annual
Report, are incorporated herein by reference.

LEGAL MATTERS

Certain legal matters concerning the issuance of the shares of Capital Fund
to be issued in the Reorganization will be passed by Dorsey & Whitney LLP, 220
South Sixth Street, Minneapolis, Minnesota 55402.

17
<PAGE>
AGREEMENT AND PLAN OF REORGANIZATION

FORTIS FIDUCIARY FUND, INC. AND FORTIS CAPITAL FUND

THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of
this day of , 1998, by and between Fortis Fiduciary Fund, Inc.
("Fiduciary Fund"), a Minnesota corporation, and Fortis Equity Portfolios, Inc.
("Equity Portfolios"), a Minnesota corporation, on behalf of Fortis Capital Fund
("Capital Fund"), a series of Equity Portfolios. The shares of Capital Fund
designated in the amended and restated articles of incorporation of Equity
Portfolios are referred to herein by the name set forth in the bylaws of Equity
Portfolios as follows:

<TABLE>
<CAPTION>
DESIGNATION IN ARTICLES OF EQUITY PORTFOLIOS NAME ASSIGNED IN BYLAWS
- --------------------------------------------------------------------- -----------------------
<S> <C>
Series A............................................................. Fortis Capital Fund
</TABLE>

This Agreement is intended to be and is adopted as a plan of reorganization
and liquidation pursuant to Sections 368(a)(1)(C) and 368(a)(2)(G) of the United
States Internal Revenue Code of 1986, as amended (the "Code"). The
reorganization (the "Reorganization") will consist of the transfer of all or
substantially all of the assets of Fiduciary Fund to Capital Fund and the
assumption by Capital Fund of all of the liabilities of Fiduciary Fund in
exchange solely for full and fractional shares of common stock, par value $.01
per share, of Capital Fund (the "Capital Fund Shares"), having an aggregate net
asset value equal to the aggregate value of the assets acquired (less
liabilities assumed) of Fiduciary Fund, and the distribution of Capital Fund
Shares to the shareholders of Fiduciary Fund in liquidation of Fiduciary Fund as
provided herein, all upon the terms and conditions hereinafter set forth.

WITNESSETH:

WHEREAS, each of Fiduciary Fund and Equity Portfolios is a registered,
open-end management investment company, with Equity Portfolios offering its
shares of common stock in multiple series (each of which series represents a
separate and distinct portfolio of assets and liabilities) and Fiduciary Fund
offering its shares of common stock in a single series;

WHEREAS, both Fiduciary Fund and Capital Fund offer Class A, Class B, Class
C and Class H shares;

WHEREAS, Fiduciary Fund owns securities which generally are assets of the
character in which Capital Fund is permitted to invest; and

WHEREAS, the Board of Directors of each of Fiduciary Fund and Capital Fund
has determined that the exchange of all or substantially all of the assets of
Fiduciary Fund for Capital Fund Shares and the assumption of all of the
liabilities of Fiduciary Fund by Capital Fund is in the best interests of the
shareholders of Fiduciary Fund and Capital Fund, respectively.

NOW, THEREFORE, in consideration of the premises and of the representations,
warranties, covenants and agreements hereinafter set forth, the parties hereto
covenant and agree as follows:

1. TRANSFER OF ALL OR SUBSTANTIALLY ALL OF THE ASSETS OF FIDUCIARY FUND TO
CAPITAL FUND SOLELY IN EXCHANGE FOR CAPITAL FUND SHARES, THE ASSUMPTION OF
ALL FIDUCIARY FUND LIABILITIES AND THE LIQUIDATION OF FIDUCIARY FUND

1.1 Subject to the requisite approval by Fiduciary Fund shareholders and to
the other terms and conditions set forth herein and on the basis of the
representations and warranties contained herein, Fiduciary Fund agrees to
transfer all or substantially all of Fiduciary Fund's assets as set forth in
Section 1.2 to Capital Fund, and Capital Fund agrees in exchange therefor (a) to
deliver to Fiduciary Fund that number of full and fractional Capital Fund Shares
determined in accordance with Article 2, and (b) to assume all of the
liabilities of Fiduciary Fund, as set forth in Section 1.3. Such transactions
shall take place as of the effective time provided for in Section 3.1 (the
"Effective Time").

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1.2 (a) The assets of Fiduciary Fund to be acquired by Capital Fund shall
consist of all or substantially all of Fiduciary Fund's property, including, but
not limited to, all cash, securities, commodities, futures, and interest and
dividends receivable which are owned by Fiduciary Fund as of the Effective Time.
All of said assets shall be set forth in detail in an unaudited statement of
assets and liabilities of Fiduciary Fund as of the Effective Time (the
"Effective Time Statement"). The Effective Time Statement shall, with respect to
the listing of Fiduciary Fund's portfolio securities, detail the adjusted tax
basis of such securities by lot, the respective holding periods of such
securities and the current and accumulated earnings and profits of Fiduciary
Fund. The Effective Time Statement shall be prepared in accordance with
generally accepted accounting principles (except for footnotes) consistently
applied from the prior audited period.

(b) Fiduciary Fund has provided Capital Fund with a list of all of Fiduciary
Fund's assets as of the date of execution of this Agreement. Fiduciary Fund
reserves the right to sell any of these securities in the ordinary course of its
business and, subject to Section 5.1, to acquire additional securities in the
ordinary course of its business.

1.3 Capital Fund shall assume all of the liabilities, expenses, costs,
charges and reserves (including, but not limited to, expenses incurred in the
ordinary course of Fiduciary Fund's operations, such as accounts payable
relating to custodian fees, investment management and administrative fees, legal
and audit fees, and expenses of state securities registration of Fiduciary
Fund's shares), including those reflected in the Effective Time Statement.

1.4 Immediately after the transfer of assets provided for in Section 1.1 and
the assumption of liabilities provided for in Section 1.3, and pursuant to the
plan of reorganization adopted herein, Fiduciary Fund will distribute pro rata
(as provided in Article 2) to Fiduciary Fund's shareholders of record,
determined as of the Effective Time (the "Fiduciary Fund Shareholders"), the
Capital Fund Shares received by Fiduciary Fund pursuant to Section 1.1, and all
other assets of Fiduciary Fund, if any. Thereafter, no additional shares
representing interests in Fiduciary Fund shall be issued. Such distribution will
be accomplished by the transfer of the Capital Fund Shares then credited to the
account of Fiduciary Fund on the books of Capital Fund to open accounts on the
share records of Capital Fund in the names of Fiduciary Fund shareholders
representing the numbers and classes of Capital Fund Shares due each such
shareholder. All issued and outstanding shares of Fiduciary Fund will
simultaneously be canceled on the books of Fiduciary Fund, although share
certificates representing interests in Fiduciary Fund will represent those
numbers and classes of Capital Fund Shares after the Effective Time as
determined in accordance with Article 2. Unless requested by Fiduciary Fund
Shareholders, Capital Fund will not issue certificates representing Capital Fund
Shares issued in connection with such exchange.

1.5 Ownership of Capital Fund Shares will be shown on the books of Capital
Fund. Capital Fund Shares will be issued in the manner described in Capital
Fund's Prospectus and Statement of Additional Information as in effect as of the
Effective Time, except that no front-end sales charges will be incurred by
Fiduciary Fund Shareholders in connection with their acquisition of Capital Fund
Shares pursuant to this Agreement.

1.6 Capital Fund agrees that in determining contingent deferred sales
charges applicable to Class B, Class C and Class H shares distributed by it in
the reorganization and the date upon which Class B and Class H shares
distributed by it in the Reorganization convert to Class A shares, it shall give
credit for the period during which the holders thereof held the Fiduciary Fund
Shares in exchange for which such Capital Fund Shares were issued. In the event
that Class A shares of Capital Fund are distributed in the Reorganization to
former holders of Class A shares of Fiduciary Fund with respect to which the
front-end sales charge was waived due to a purchase of $1 million or more,
Capital Fund agrees that in determining whether a deferred sales charge is
payable upon the sale of such Class A shares of Capital Fund it shall give
credit for the period during which the holder thereof held such Fiduciary Fund
shares.

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1.7 Any reporting responsibility of Fiduciary Fund, including, but not
limited to, the responsibility for filing of regulatory reports, tax returns, or
other documents with the Securities and Exchange Commission (the "Commission"),
any state securities commissions, and any federal, state or local tax
authorities or any other relevant regulatory authority, is and shall remain the
responsibility of Fiduciary Fund.

2. VALUATION; ISSUANCE OF CAPITAL FUND SHARES

2.1 The net asset value per share of Fiduciary Fund's Class A, Class B,
Class C and Class H shares shall be computed as of the Effective Time using the
valuation procedures set forth in its articles of incorporation and bylaws, its
then-current Prospectus and Statement of Additional Information, and as may be
required by the Investment Company Act of 1940, as amended (the "1940 Act").

2.2 (a) The total number of Class A Capital Fund shares to be issued
(including fractional shares, if any) in exchange for the assets and liabilities
of Fiduciary Fund which are allocable to Fiduciary Fund's Class A shares shall
be determined as of the Effective Time by multiplying the number of Class A
Fiduciary Fund shares outstanding immediately prior to the Effective Time times
a fraction, the numerator of which is the net asset value per share of Fiduciary
Fund's Class A shares immediately prior to the Effective Time, and the
denominator of which is the net asset value per share of Capital Fund's Class A
shares immediately prior to the Effective Time, each as determined pursuant to
Section 2.1.

(b) The total number of Class B Capital Fund shares to be issued (including
fractional shares, if any) in exchange for the assets and liabilities of
Fiduciary Fund which are allocable to Fiduciary Fund's Class B shares shall be
determined as of the Effective Time by multiplying the number of Class B
Fiduciary Fund shares outstanding immediately prior to the Effective Time times
a fraction, the numerator of which is the net asset value per share of Fiduciary
Fund's Class B shares immediately prior to the Effective Time, and the
denominator of which is the net asset value per share of Capital Fund's Class B
shares immediately prior to the Effective Time, each as determined pursuant to
Section 2.1.

(c) The total number of Class C Capital Fund shares to be issued (including
fractional shares, if any) in exchange for the assets and liabilities of
Fiduciary Fund which are allocable to Fiduciary Fund's Class C shares shall be
determined as of the Effective Time by multiplying the number of Class C
Fiduciary Fund shares outstanding immediately prior to the Effective Time times
a fraction, the numerator of which is the net asset value per share of Fiduciary
Fund's Class C shares immediately prior to the Effective Time, and the
denominator of which is the net asset value per share of Capital Fund's Class C
shares immediately prior to the Effective Time, each as determined pursuant to
Section 2.1.

(d) The total number of Class H Capital Fund shares to be issued (including
fractional shares, if any) in exchange for the assets and liabilities of
Fiduciary Fund which are allocable to Fiduciary Fund's Class H shares shall be
determined as of the Effective Time by multiplying the number of Class H
Fiduciary Fund shares outstanding immediately prior to the Effective Time times
a fraction, the numerator of which is the net asset value per share of Fiduciary
Fund's Class H shares immediately prior to the Effective Time, and the
denominator of which is the net asset value per share of Capital Fund's Class H
shares immediately prior to the Effective Time, each as determined pursuant to
Section 2.1.

2.3 Immediately after the Effective Time, Fiduciary Fund shall distribute to
Fiduciary Fund Shareholders of the respective classes in liquidation of
Fiduciary Fund pro rata within classes (based upon the ratio that the number of
Fiduciary Fund shares of the respective classes owned by each Fiduciary Fund
Shareholder immediately prior to the Effective Time bears to the total number of
issued and outstanding Fiduciary Fund shares of such classes immediately prior
to the Effective Time) the full and fractional Capital Fund Shares of the
respective classes received by Fiduciary Fund pursuant to Section 2.2.
Accordingly, each Class A Fiduciary Fund Shareholder shall receive, immediately
after the Effective Time, Class A Capital Fund shares with an aggregate net
asset value equal to the aggregate net asset value of the Class A Fiduciary Fund
shares owned by such Fiduciary Fund Shareholder immediately prior to the
Effective Time; each Class B Fiduciary Fund Shareholder shall receive,
immediately after the Effective

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<PAGE>
Time, Class B Capital Fund shares with an aggregate net asset value equal to the
aggregate net asset value of the Class B Fiduciary Fund shares owned by such
Fiduciary Fund Shareholder immediately prior to the Effective Time; each Class C
Fiduciary Fund Shareholder shall receive, immediately after the Effective Time,
Class C Capital Fund shares with an aggregate net asset value equal to the
aggregate net asset value of the Class C Fiduciary Fund shares owned by such
Fiduciary Fund Shareholder immediately prior to the Effective Time; and each
Class H Fiduciary Fund Shareholder shall receive, immediately after the
Effective Time, Class H Capital Fund shares with an aggregate net asset value
equal to the aggregate net asset value of the Class H Fiduciary Fund shares
owned by such Fiduciary Fund Shareholder immediately prior to the Effective
Time.

3. EFFECTIVE TIME; CLOSING

3.1 The closing of the transactions contemplated by this Agreement (the
"Closing") shall occur as of the close of normal trading on the New York Stock
Exchange (the "Exchange") (currently, 4:00 p.m. Eastern time) on the first day
upon which the conditions to closing shall have been satisfied (but not prior to
, 1998), or at such time on such later date as provided herein or as the
parties otherwise may agree in writing (such time and date being referred to
herein as the "Effective Time"). All acts taking place at the Closing shall be
deemed to take place simultaneously as of the Effective Time unless otherwise
agreed to by the parties. The Closing shall be held at the offices of Dorsey &
Whitney LLP, 220 South Sixth Street, Minneapolis, Minnesota 55402, or at such
other place as the parties may agree.

3.2 Fiduciary Fund shall deliver at the Closing its written instructions to
the custodian for Fiduciary Fund, acknowledged and agreed to in writing by such
custodian, irrevocably instructing such custodian to transfer to Capital Fund
all of Fiduciary Fund's portfolio securities, cash, and any other assets to be
acquired by Capital Fund pursuant to this Agreement.

3.3 In the event that the Effective Time occurs on a day on which (a) the
Exchange or another primary trading market for portfolio securities of Capital
Fund or Fiduciary Fund shall be closed to trading or trading thereon shall be
restricted, or (b) trading or the reporting of trading on the Exchange or
elsewhere shall be disrupted so that accurate appraisal of the value of the net
assets of Capital Fund or Fiduciary Fund is impracticable, the Effective Time
shall be postponed until the close of normal trading on the Exchange on the
first business day when trading shall have been fully resumed and reporting
shall have been restored.

3.4 Fiduciary Fund shall deliver at the Closing its certificate stating that
the records maintained by its transfer agent (which shall be made available to
Capital Fund) contain the names and addresses of Fiduciary Fund shareholders and
the number of outstanding Fiduciary Fund shares owned by each such shareholder
as of the Effective Time. Capital Fund shall certify at the Closing that Capital
Fund Shares required to be issued by it pursuant to this Agreement have been
issued and delivered as required herein.

3.5 At the Closing, each party to this Agreement shall deliver to the other
such bills of sale, liability assumption agreements, checks, assignments, share
certificates, if any, receipts or other similar documents as such other party or
its counsel may reasonably request.

4. REPRESENTATIONS, WARRANTIES AND COVENANTS

4.1 Fiduciary Fund represents, warrants and covenants to Capital Fund as
follows:

(a) Fiduciary Fund is a corporation duly organized, validly existing and in
good standing under the laws of the State of Minnesota;

(b) Fiduciary Fund is a registered investment company classified as a
management company of the open-end type, and its registration with the
Commission as an investment company under the 1940 Act, and of its shares under
the Securities Act of 1933, as amended (the "1933 Act"), is in full force and
effect;

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(c) All appropriate filings under Section 18 of the Securities Act of 1933,
as amended, required by state securities laws ("Blue Sky Filings") have been
made and have not been disapproved within the time periods applicable thereto;
said Blue Sky Filings, including any periodic reports or supplemental filings,
are complete and current; all fees required to be paid in connection with such
Blue Sky Filings have been paid; and Fiduciary Fund is in good standing, is not
subject to any stop orders, and is fully qualified to sell its shares in any
state in which the necessary Blue Sky Filings have been made.

(d) The Prospectus and Statement of Additional Information of Fiduciary
Fund, as of the date hereof and up to and including the Effective Time, conform
and will conform in all material respects to the applicable requirements of the
1933 Act and the 1940 Act and the rules and regulations of the Commission
thereunder and do not and will not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not materially misleading;

(e) Fiduciary Fund is not, and the execution, delivery and performance of
this Agreement will not result, in a violation of its articles of incorporation
or bylaws or of any material agreement, indenture, instrument, contract, lease
or other undertaking to which it is a party or by which it is bound;

(f) No material litigation or administrative proceeding or investigation of
or before any court or governmental body is presently pending or, to the best of
Fiduciary Fund's knowledge, threatened against Fiduciary Fund or any of its
properties or assets. Fiduciary Fund is not a party to or subject to the
provisions of any order, decree or judgment of any court or governmental body
which materially and adversely affects its business or its ability to consummate
the transactions herein contemplated;

(g) The Statement of Assets and Liabilities of Fiduciary Fund as of the end
of its most recently concluded fiscal year has been audited by KPMG Peat Marwick
LLP, independent accountants, and is in accordance with generally accepted
accounting principles consistently applied, and such statement (a copy of which
has been furnished to Capital Fund) presents fairly, in all material respects,
the financial position of Fiduciary Fund as of such date, and there are no known
material contingent liabilities of Fiduciary Fund as of such date not disclosed
therein;

(h) Since the end of Fiduciary Fund's most recently concluded fiscal year,
there has not been any material adverse change in Fiduciary Fund's financial
condition, assets, liabilities or business other than changes occurring in the
ordinary course of business, except as otherwise disclosed to Capital Fund. For
the purposes of this paragraph (h), a decline in net asset value per share of
Fiduciary Fund, the discharge or incurrence of Fiduciary Fund liabilities in the
ordinary course of business, or the redemption of Fiduciary Fund shares by
Fiduciary Fund shareholders, shall not constitute such a material adverse
change;

(i) All material federal and other tax returns and reports of Fiduciary Fund
required by law to have been filed prior to the Effective Time shall have been
filed and shall be correct, and all federal and other taxes shown as due or
required to be shown as due on said returns and reports shall have been paid or
provision shall have been made for the payment thereof, and, to the best of
Fiduciary Fund's knowledge, no such return is currently under audit and no
assessment shall have been asserted with respect to such returns;

(j) For each taxable year of its operation, Fiduciary Fund has met the
requirements of Subchapter M of the Code for qualification and treatment as a
regulated investment company, and Fiduciary Fund intends to meet the
requirements of Subchapter M of the Code for qualification and treatment as a
regulated investment company for its final, partial taxable year;

(k) All issued and outstanding shares of Fiduciary Fund are, and at the
Effective Time will be, duly and validly issued and outstanding, fully paid and
non-assessable, and were offered for sale and sold in conformity with the
registration requirements of all applicable federal and state securities laws.
All of the issued and outstanding shares of Fiduciary Fund will, at the
Effective Time, be held by the persons and in the amounts set forth in the
records of Fiduciary Fund, as provided in Section 3.4. Fiduciary Fund does not

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<PAGE>
have outstanding any options, warrants or other rights to subscribe for or
purchase any Fiduciary Fund shares, and there is not outstanding any security
convertible into any Fiduciary Fund shares (other than Class B and Class H
shares which automatically convert to Class A shares after a specified period);

(l) At the Effective Time, Fiduciary Fund will have good and marketable
title to Fiduciary Fund's assets to be transferred to Capital Fund pursuant to
Section 1.2 and full right, power, and authority to sell, assign, transfer and
deliver such assets hereunder, and upon delivery of and payment for such assets,
Capital Fund will acquire good and marketable title thereto, subject to no
restrictions on the full transfer thereof, including such restrictions as might
arise under the 1933 Act other than as disclosed to Capital Fund in the
Effective Time Statement;

(m) The execution, delivery and performance of this Agreement will have been
duly authorized prior to the Effective Time by all necessary action on the part
of Fiduciary Fund's Board of Directors, and, subject to the approval of
Fiduciary Fund shareholders, this Agreement will constitute a valid and binding
obligation of Fiduciary Fund, enforceable in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance and other laws relating to or affecting creditors' rights
and to the application of equitable principles in any proceeding, whether at law
or in equity;

(n) The information to be furnished by and on behalf of Fiduciary Fund for
use in registration statements, proxy materials and other documents which may be
necessary in connection with the transactions contemplated hereby shall be
accurate and complete in all material respects;

(o) All information pertaining to Fiduciary Fund, its agents and affiliates
and included in the Registration Statement referred to in Section 5.5 (or
supplied by Fiduciary Fund or its agents or affiliates for inclusion in said
Registration Statement), on the effective date of said Registration Statement
and up to and including the Effective Time, will not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which such statements are made, not materially misleading
(other than as may timely be remedied by further appropriate disclosure);

(p) Since the end of Fiduciary Fund's most recently concluded fiscal year,
there have been no material changes by Fiduciary Fund in accounting methods,
principles or practices, including those required by generally accepted
accounting principles, except as disclosed in writing to Capital Fund; and

(q) The Effective Time Statement will be prepared in accordance with
generally accepted accounting principles (except for footnotes) consistently
applied and will present accurately the assets and liabilities of Fiduciary Fund
as of the Effective Time, and the values of Fiduciary Fund's assets and
liabilities to be set forth in the Effective Time Statement will be computed as
of the Effective Time using the valuation procedures set forth in Fiduciary
Fund's articles of incorporation and bylaws, its then-current Prospectus and
Statement of Additional Information, and as may be required by the 1940 Act. At
the Effective Time, Fiduciary Fund will have no liabilities, whether absolute or
contingent, known or unknown, accrued or unaccrued, which are not reflected in
the Effective Time Statement.

4.2 Capital Fund represents, warrants and covenants to Fiduciary Fund as
follows:

(a) Equity Portfolios is a corporation duly organized, validly existing and
in good standing under the laws of the State of Minnesota;

(b) Equity Portfolios is a registered investment company classified as a
management company of the open-end type, and its registration with the
Commission as an investment company under the 1940 Act, and of each series of
shares offered by Equity Portfolios under the 1933 Act, is in full force and
effect;

(c) All appropriate filings under Section 18 of the Securities Act of 1933,
as amended, required by state securities laws ("Blue Sky Filings") have been
made and have not been disapproved within the time periods applicable thereto;
said Blue Sky Filings, including any periodic reports or supplemental filings,
are

23
<PAGE>
complete and current; all fees required to be paid in connection with such Blue
Sky Filings have been paid; and Capital Fund is in good standing, is not subject
to any stop orders, and is fully qualified to sell its shares in any state in
which the necessary Blue Sky Filings have been made.

(d) The Prospectus and Statement of Additional Information of Capital Fund,
as of the date hereof and up to and including the Effective Time, conform and
will conform in all material respects to the applicable requirements of the 1933
Act and the 1940 Act and the rules and regulations of the Commission thereunder
and do not and will not include any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not materially misleading;

(e) Capital Fund is not, and the execution, delivery and performance of this
Agreement will not result, in a violation of Equity Portfolios' articles of
incorporation or bylaws or of any material agreement, indenture, instrument,
contract, lease or other undertaking to which Capital Fund is a party or by
which it is bound;

(f) No material litigation or administrative proceeding or investigation of
or before any court or governmental body is presently pending or, to the best of
Capital Fund's knowledge, threatened against Capital Fund or any of its
properties or assets. Capital Fund is not a party to or subject to the
provisions of any order, decree or judgment of any court or governmental body
which materially and adversely affects its business or its ability to consummate
the transactions herein contemplated;

(g) The Statement of Assets and Liabilities of Capital Fund as of the end of
its most recently concluded fiscal year has been audited by KPMG Peat Marwick
LLP, independent accountants, and is in accordance with generally accepted
accounting principles consistently applied, and such statement (a copy of which
has been furnished to Fiduciary Fund) presents fairly, in all material respects,
the financial position of Capital Fund as of such date, and there are no known
material contingent liabilities of Capital Fund as of such date not disclosed
therein;

(h) Since the end of Capital Fund's most recently concluded fiscal year,
there has not been any material adverse change in Capital Fund's financial
condition, assets, liabilities or business other than changes occurring in the
ordinary course of business, except as otherwise disclosed to Fiduciary Fund.
For the purposes of this paragraph (h), a decline in net asset value per share
of Capital Fund, the discharge or incurrence of Capital Fund liabilities in the
ordinary course of business, or the redemption of Capital Fund shares by Capital
Fund shareholders, shall not constitute such a material adverse change;

(i) All material federal and other tax returns and reports of Capital Fund
required by law to have been filed prior to the Effective Time shall have been
filed and shall be correct, and all federal and other taxes shown as due or
required to be shown as due on said returns and reports shall have been paid or
provision shall have been made for the payment thereof, and, to the best of
Capital Fund's knowledge, no such return is currently under audit and no
assessment shall have been asserted with respect to such returns;

(j) For each taxable year of its operation, Capital Fund has met the
requirements of Subchapter M of the Code for qualification and treatment as a
regulated investment company, and Capital Fund intends to meet the requirements
of Subchapter M of the Code for qualification and treatment as a regulated
investment company in the current and future years;

(k) All issued and outstanding shares of Capital Fund are, and at the
Effective Time will be, duly and validly issued and outstanding, fully paid and
non-assessable, and were offered for sale and sold in conformity with the
registration requirements of all applicable federal and state securities laws.
Capital Fund Shares to be issued and delivered to Fiduciary Fund for the account
of Fiduciary Fund Shareholders, pursuant to the terms of this Agreement, at the
Effective Time will have been duly authorized and, when so issued and delivered,
will be duly and validly issued and outstanding, fully paid and non-assessable.
Capital Fund does not have outstanding any options, warrants or other rights to
subscribe for or purchase

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<PAGE>
any Capital Fund shares, and there is not outstanding any security convertible
into any Capital Fund shares (other than Class B and Class H shares which
automatically convert to Class A shares after a specified period);

(l) The execution, delivery and performance of this Agreement will have been
duly authorized prior to the Effective Time by all necessary action on the part
of Equity Portfolios' Board of Directors, and at the Effective Time this
Agreement will constitute a valid and binding obligation of Capital Fund,
enforceable in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and
other laws relating to or affecting creditors' rights and to the application of
equitable principles in any proceeding, whether at law or in equity.
Consummation of the transactions contemplated by this Agreement does not require
the approval of Capital Fund's shareholders;

(m) The information to be furnished by and on behalf of Capital Fund for use
in registration statements, proxy materials and other documents which may be
necessary in connection with the transactions contemplated hereby shall be
accurate and complete in all material respects;

(n) Since the end of Capital Fund's most recently concluded fiscal year,
there have been no material changes by Capital Fund in accounting methods,
principles or practices, including those required by generally accepted
accounting principles, except as disclosed in writing to Fiduciary Fund; and

(o) The Registration Statement referred to in Section 5.5, on its effective
date and up to and including the Effective Time, will (i) conform in all
material respects to the applicable requirements of the 1933 Act, the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and the 1940 Act and the
rules and regulations of the Commission thereunder, and (ii) not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which such statements were made, not materially misleading
(other than as may timely be remedied by further appropriate disclosure);
provided, however, that the representations and warranties in clause (ii) of
this paragraph shall not apply to statements in (or omissions from) the
Registration Statement concerning Fiduciary Fund, its agents and affiliates (or
supplied by Fiduciary Fund, its agents or affiliates for inclusion in said
Registration Statement).

5. FURTHER COVENANTS OF CAPITAL FUND AND FIDUCIARY FUND

5.1 Each of Fiduciary Fund and Capital Fund will operate its business in the
ordinary course between the date hereof and the Effective Time, it being
understood that such ordinary course of business will include the declaration
and payment of customary dividends and distributions, and any other
distributions that may be advisable (which may include distributions prior to
the Effective Time of net income and/or net realized capital gains not
previously distributed). Fiduciary Fund agrees that through the Effective Time,
it will not acquire any securities which are not permissible investments for
Capital Fund.

5.2 Fiduciary Fund will call a meeting of its shareholders to consider and
act upon this Agreement and to take all other action necessary to obtain
approval of the transactions contemplated herein.

5.3 Fiduciary Fund will assist Capital Fund in obtaining such information as
Capital Fund reasonably requests concerning the beneficial ownership of
Fiduciary Fund shares.

5.4 Subject to the provisions of this Agreement, Capital Fund and Fiduciary
Fund will each take, or cause to be taken, all actions, and do or cause to be
done, all things reasonably necessary, proper or advisable to consummate and
make effective the transactions contemplated by this Agreement.

5.5 Fiduciary Fund will provide Capital Fund with information reasonably
necessary with respect to Fiduciary Fund and its agents and affiliates for the
preparation of the Registration Statement on Form N-14 of Capital Fund (the
"Registration Statement"), in compliance with the 1933 Act, the 1934 Act and the
1940 Act.

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<PAGE>
5.6 Capital Fund agrees to use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act and such
state blue sky or securities laws as may be necessary in order to conduct its
operations after the Effective Time.

6. CONDITIONS PRECEDENT TO OBLIGATIONS OF FIDUCIARY FUND

The obligations of Fiduciary Fund to consummate the transactions provided
for herein shall be subject, at its election, to the performance by Capital Fund
of all the obligations to be performed by it hereunder at or before the
Effective Time, and, in addition thereto, the following further conditions (any
of which may be waived by Fiduciary Fund, in its sole and absolute discretion):

6.1 All representations and warranties of Capital Fund contained in this
Agreement shall be true and correct as of the date hereof and, except as they
may be affected by the transactions contemplated by this Agreement, as of the
Effective Time with the same force and effect as if made at such time;

6.2 Capital Fund shall have delivered to Fiduciary Fund a certificate
executed in its name by its President or a Vice President, in a form reasonably
satisfactory to Fiduciary Fund and dated as of the date of the Closing, to the
effect that the representations and warranties of Capital Fund made in this
Agreement are true and correct at the Effective Time, except as they may be
affected by the transactions contemplated by this Agreement, and as to such
other matters as Fiduciary Fund shall reasonably request; and

6.3 Capital Fund shall have delivered to Fiduciary Fund the certificate as
to the issuance of Capital Fund shares contemplated by the second sentence of
Section 3.4.

7. CONDITIONS PRECEDENT TO OBLIGATIONS OF CAPITAL FUND

The obligations of Capital Fund to consummate the transactions provided for
herein shall be subject, at its election, to the performance by Fiduciary Fund
of all of the obligations to be performed by it hereunder at or before the
Effective Time and, in addition thereto, the following conditions (any of which
may be waived by Capital Fund, in its sole and absolute discretion):

7.1 All representations and warranties of Fiduciary Fund contained in this
Agreement shall be true and correct as of the date hereof and, except as they
may be affected by the transactions contemplated by this Agreement, as of the
Effective Time with the same force and effect as if made at such time;

7.2 Capital Fund shall have received, and certified as to its receipt of,
the Effective Time Statement;

7.3 Fiduciary Fund shall have delivered to Capital Fund a certificate
executed in its name by its President or a Vice President, in a form reasonably
satisfactory to Capital Fund and dated as of the date of the Closing, to the
effect that the representations and warranties of Fiduciary Fund made in this
Agreement are true and correct at the Effective Time, except as they may be
affected by the transactions contemplated by this Agreement, and as to such
other matters as Capital Fund shall reasonably request;

7.4 Fiduciary Fund shall have delivered to Capital Fund the written
instructions to the custodian for Fiduciary Fund contemplated by Section 3.2;

7.5 Fiduciary Fund shall have delivered to Capital Fund the certificate as
to its shareholder records contemplated by the first sentence of Section 3.4;

7.6 At or prior to the Effective Time, Fiduciary Fund's investment adviser,
or an affiliate thereof, shall have reimbursed Fiduciary Fund by the amount, if
any, that the expenses incurred by Fiduciary Fund (or accrued up to the
Effective Time) exceed any applicable contractual expense limitations; and

7.7 Immediately prior to the Effective Time, Fiduciary Fund shall not hold
any securities which are not permissible investments for Capital Fund.

26
<PAGE>
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF CAPITAL FUND AND FIDUCIARY
FUND

The following shall constitute further conditions precedent to the
consummation of the Reorganization:

8.1 This Agreement and the transactions contemplated herein shall have been
approved by the requisite vote of the holders of the outstanding shares of
Fiduciary Fund in accordance with the provisions of its articles of
incorporation and bylaws and applicable law, and certified copies of the
resolutions evidencing such approval shall have been delivered to Capital Fund.
Notwithstanding anything herein to the contrary, neither Capital Fund nor
Fiduciary Fund may waive the conditions set forth in this Section 8.1;

8.2 As of the Effective Time, no action, suit or other proceeding shall be
threatened or pending before any court or governmental agency in which it is
sought to restrain or prohibit, or obtain damages or other relief in connection
with, this Agreement or the transactions contemplated herein;

8.3 All consents of other parties and all other consents, orders and permits
of federal, state and local regulatory authorities deemed necessary by Capital
Fund or Fiduciary Fund to permit consummation, in all material respects, of the
transactions contemplated hereby shall have been obtained, except where failure
to obtain any such consent, order or permit would not involve a risk of a
material adverse effect on the assets or properties of Capital Fund or Fiduciary
Fund, provided that either party hereto may for itself waive any of such
conditions;

8.4 The Registration Statement shall have become effective under the 1933
Act, and no stop order suspending the effectiveness thereof shall have been
issued and, to the best knowledge of the parties hereto, no investigation or
proceeding for that purpose shall have been instituted or be pending, threatened
or contemplated under the 1933 Act;

8.5 The parties shall have received the opinion of Dorsey & Whitney LLP
addressed to Fiduciary Fund and Capital Fund, dated as of the date of the
Closing, and based in part on certain representations to be furnished by
Fiduciary Fund, Capital Fund, and their investment adviser and other service
providers, substantially to the effect that:

(ii) Fiduciary Fund shareholders will recognize no income, gain or loss
upon receipt, pursuant to the Reorganization, of Capital Fund Shares.
Fiduciary Fund shareholders subject to taxation will recognize income upon
receipt of any net investment income or net capital gains of Fiduciary Fund
which are distributed by Fiduciary Fund prior to the Effective Time;

(iii) the tax basis of Capital Fund Shares received by each Fiduciary
Fund shareholder pursuant to the Reorganization will be equal to the tax
basis of Fiduciary Fund shares exchanged therefor;

(iv) the holding period of Capital Fund Shares received by each
Fiduciary Fund shareholder pursuant to the Reorganization will include the
period during which Fiduciary Fund shareholder held Fiduciary Fund shares
exchanged therefor, provided that Fiduciary Fund shares were held as a
capital asset at the Effective Time;

(v) Fiduciary Fund will recognize no income, gain or loss by reason of
the Reorganization;

(vi) Capital Fund will recognize no income, gain or loss by reason of
the Reorganization;

(vii) the tax basis of the assets received by Capital Fund pursuant to
the Reorganization will be the same as the basis of those assets in the
hands of Fiduciary Fund as of the Effective Time;

27
<PAGE>
(viii) the holding period of the assets received by Capital Fund pursuant
to the Reorganization will include the period during which such assets were
held by Fiduciary Fund; and

(ix) Capital Fund will succeed to and take into account the earnings and
profits, or deficit in earnings and profits, of Fiduciary Fund as of the
Effective Time.

9. EXPENSES; INDEMNIFICATION

9.1 All expenses incurred by the parties hereto in connection with the
transactions contemplated hereby (including, without limitation, the fees and
expenses associated with the preparation and filing of the Registration
Statement referred to in Section 5.5 above and the expenses of printing and
mailing the prospectus/proxy statement, soliciting proxies and holding the
Fiduciary Fund shareholders meeting required to approve the transactions
contemplated hereby) shall be allocated between and borne by Fiduciary Fund and
Capital Fund in proportion to their relative net assets at the Effective Time.
Such expenses, and the allocation thereof, shall be reflected in the
calculations of net asset values pursuant to Section 2.1.

9.2 Capital Fund agrees to indemnify and hold harmless Fiduciary Fund and
each of Fiduciary Fund's directors and officers from and against any and all
losses, claims, damages, liabilities or expenses (including, without limitation,
the payment of reasonable legal fees and reasonable costs of investigation) to
which, jointly or severally, Fiduciary Fund or any of its directors or officers
may become subject, insofar as any such loss, claim, damage, liability or
expense (or actions with respect thereto) arises out of or is based on any
breach by Capital Fund of any of its representations, warranties, covenants or
agreements set forth in this Agreement.

9.3 Fiduciary Fund agrees to indemnify and hold harmless Capital Fund and
each of Capital Fund's directors and officers from and against any and all
losses, claims, damages, liabilities or expenses (including, without limitation,
the payment of reasonable legal fees and reasonable costs of investigation) to
which, jointly or severally, Capital Fund or any of its directors or officers
may become subject, insofar as any such loss, claim, damage, liability or
expense (or actions with respect thereto) arises out of or is based on any
breach by Fiduciary Fund of any of its representations, warranties, covenants or
agreements set forth in this Agreement.

10. ENTIRE AGREEMENT; SURVIVAL OF REPRESENTATIONS AND WARRANTIES

10.1 Capital Fund and Fiduciary Fund agree that neither party has made any
representation, warranty, covenant or agreement not set forth herein and that
this Agreement constitutes the entire agreement between the parties.

10.2 The representations and warranties contained in this Agreement or in
any document delivered pursuant hereto or in connection herewith shall survive
the consummation of the transactions contemplated hereby.

11. TERMINATION

This Agreement and the transactions contemplated hereby may be terminated
and abandoned by either party by resolution of the party's board of directors at
any time prior to the Effective Time, if circumstances should develop that, in
the good faith opinion of such board, make proceeding with this Agreement and
such transactions not in the best interest of the applicable party's
shareholders.

12. AMENDMENTS

This Agreement may be amended, modified or supplemented in such manner as
may be mutually agreed upon in writing by the authorized officers of Fiduciary
Fund and Capital Fund; provided, however, that following the meeting of
Fiduciary Fund shareholders called by Fiduciary Fund pursuant to Section 5.2 of
this Agreement, no such amendment may have the effect of changing the provisions
for

28
<PAGE>
determining the number of Capital Fund Shares to be issued to Fiduciary Fund
shareholders under this Agreement to the detriment of such shareholders without
their further approval.

13. NOTICES

Any notice, report, statement or demand required or permitted by any
provisions of this Agreement shall be in writing and shall be deemed duly given
if delivered or mailed by registered mail, postage prepaid, addressed to Capital
Fund or Fiduciary Fund, 500 Bielenberg Drive, Woodbury, Minnesota 55125.

14. HEADINGS; COUNTERPARTS; ASSIGNMENT; MISCELLANEOUS

14.1 The Article and Section headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

14.2 This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original and all of which together shall constitute one
and the same agreement.

14.3 This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but no assignment or
transfer hereof or of any rights or obligations hereunder shall be made by
either party without the prior written consent of the other party. Nothing
herein expressed or implied is intended or shall be construed to confer upon or
give any person, firm or corporation, other than the parties hereto and their
respective successors and assigns, any rights or remedies under or by reason of
this Agreement.

14.4 The validity, interpretation and effect of this Agreement shall be
governed exclusively by the laws of the State of Minnesota, without giving
effect to the principles of conflict of laws thereof.

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed by its President or Vice President.

<TABLE>
<S> <C> <C>
FORTIS FIDUCIARY FUND, INC.

By
-----------------------------------
Its
-----------------------------------

FORTIS EQUITY PORTFOLIOS, INC.
on behalf of FORTIS CAPITAL FUND

By
-----------------------------------
Its
-----------------------------------
</TABLE>

29
<PAGE>
PROSPECTUS/PROXY STATEMENT
, 1998

PROPOSED ACQUISITION OF ASSETS OF
FORTIS FIDUCIARY FUND, INC.
BY AND IN EXCHANGE FOR SHARES OF
FORTIS CAPITAL FUND
A SEPARATELY MANAGED SERIES OF
FORTIS EQUITY PORTFOLIOS, INC.

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

TABLE OF CONTENTS

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

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
INCORPORATION BY REFERENCE..................... 2
SUMMARY........................................ 4
RISK FACTORS................................... 9
INFORMATION ABOUT THE REORGANIZATION........... 10
INFORMATION ABOUT FIDUCIARY FUND AND CAPITAL
FUND......................................... 13
VOTING INFORMATION............................. 15
FINANCIAL STATEMENTS AND EXPERTS............... 17
LEGAL MATTERS.................................. 17
EXHIBIT A--AGREEMENT AND PLAN OF REORGANIZATION
</TABLE>

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

THE FOLLOWING DOCUMENTS ACCOMPANY THIS PROSPECTUS/PROXY STATEMENT:

PROSPECTUS DATED JANUARY 1, 1998 OF FORTIS CAPITAL FUND AND FORTIS FIDUCIARY
FUND

ANNUAL REPORT OF FORTIS CAPITAL FUND AND FORTIS FIDUCIARY FUND FOR THE FISCAL
YEAR ENDED AUGUST 31, 1997

SEMI-ANNUAL REPORT OF FORTIS CAPITAL FUND AND FORTIS FIDUCIARY FUND FOR THE
SIX-MONTH PERIOD ENDED FEBRUARY 28, 1998
<PAGE>

PART B

STATEMENT OF ADDITIONAL INFORMATION
DATED ________, 1998

ACQUISITION OF THE ASSETS OF

FORTIS FIDUCIARY FUND, INC.
500 BIELENBERG DRIVE, WOODBURY, MINNESOTA 55125
MAILING ADDRESS: P.O. BOX 64284, ST. PAUL, MINNESOTA 55164
(800) 738-4000

BY AND IN EXCHANGE FOR SHARES OF

This Statement of Additional Information relates to the proposed Agreement
and Plan of Reorganization providing for (a) the acquisition of substantially
all of the assets and the assumption of all liabilities of Fortis Fiduciary
Fund, Inc. (the "Acquired Fund") Fortis Capital Fund (the "Acquiring Fund"), a
separately managed series or Fortis Capital Fund, Inc. ("Fortis Capital"), in
exchange for shares of common stock of the Acquiring Fund having an aggregate
net asset value equal to the aggregate value of the assets acquired (less the
liabilities assumed) of the Acquired Fund and (b) the liquidation of the
Acquired Fund and the pro rata distribution of the Acquiring Fund shares to
Acquired Fund shareholders.

This Statement of Additional Information consists of this cover page and
the following documents, of which items 1 through 5 are incorporated by
reference herein:

1. The Statement of Additional Information dated January 1, 1998 of the
Acquiring Fund and the Acquired Fund.

2. The Annual Report of the Acquiring Fund and the Acquired Fund for the
fiscal year ended August 31, 1997.

3. The Semi-Annual Report of the Acquiring Fund and the Acquired Fund for
the six months ended February 28, 1998.

4. Financial Statements required by Form N-14, Item 14 (to the extent not
included in items 2 and 3 above).

This Statement of Additional Information is not a prospectus. A
Prospectus/Proxy Statement dated _______, 1998 relating to the above-referenced
transaction may be obtained without charge by writing or calling the Acquired
Fund or the Acquiring Fund at the addresses or telephone numbers noted above.
This Statement of Additional Information relates to, and should be read in
conjunction with, such Prospectus/Proxy Statement.

[NOTE: In the SEC filing package, Item No. 2 referred to above is included
in Part A as materials to be delivered with the Prospectus/Proxy Statement. A
copy of Item No. 2 also will be delivered to any person requesting the Statement
of Additional Information.]

<PAGE>

PROFORMA SCHEDULE OF INVESTMENTS
At February 28, 1998 (Unaudited)

<TABLE>
<CAPTION>
SHARES PAR (HISTORICAL) SECURITY MARKET AMOUNT (HISTORICAL)
- ------------ ------------- -------------- -------------------------------- -------------------------- -------------- --------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED FUND FUND COMBINED
- ------------ ------------- -------------- -------------------------------- -------------------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS
-------------
Advertising-Public Relations
28,100 109,100 137,200 Interpublic Group of Companies, Inc. $1,531,450 $5,945,950 $7,477,400
Aerospace and Equipment
43,000 163,000 206,000 Loral Space and Communications Ltd. $1,099,187 $4,166,688 $5,265,875
Airlines
4,400 17,800 22,200 KLM Royal Dutch Air Lines NV $161,150 $651,925 $813,075
Automobile and Motor Vehicle
16,000 63,000 79,000 Magna International, Inc. Class A $968,000 $3,811,500 $4,779,500
Banks
12,000 45,000 57,000 Mellon Bank Corp. $747,750 $2,804,062 $3,551,812
12,000 47,000 59,000 Norwest Corp. $491,250 $1,924,063 $2,415,313
------------- ------------- -------------
$1,239,000 $4,728,125 $5,967,125

Biomedics, Genetics Research
15,000 59,000 74,000 Amgen, Inc. $796,875 $3,134,375 $3,931,250
26,000 100,000 126,000 Centocor, Inc. $937,625 $3,606,250 $4,543,875
------------- ------------- -------------
$1,734,500 $6,740,625 $8,475,125

Broadcasting
5,900 20,900 26,800 America Online, Inc. $714,637 $2,531,512 $3,246,149
12,000 46,000 58,000 Viacom, Inc. Class B $576,000 $2,208,000 $2,784,000
------------- ------------- -------------
$1,290,637 $4,739,512 $6,030,149

Building Materials
9,500 38,000 47,500 Masco Corp. $516,562 $2,066,250 $2,582,812
Business Services
34,100 130,400 164,500 Cognizant Corp. $1,702,869 $6,511,850 $8,214,719
30,000 118,000 148,000 Fiserv, Inc. $1,642,500 $6,460,500 $8,103,000
16,000 66,000 82,000 Ingram Micro, Inc. Class A $618,000 $2,549,250 $3,167,250
------------- ------------- -------------
$3,963,369 $15,521,600 $19,484,969

Chemicals
27,000 109,000 136,000 Monsanto Co. $1,373,625 $5,545,375 $6,919,000
Computer-Communication Equipm
14,000 57,000 71,000 Cisco Systems, Inc. $922,250 $3,754,875 $4,677,125
10,000 38,000 48,000 3Com Corp. $357,500 $1,358,500 $1,716,000
------------- ------------- -------------
$1,279,750 $5,113,375 $6,393,125

Computer-Software
16,000 58,000 74,000 EMC Corp. $612,000 $2,218,500 $2,830,500
18,000 80,000 98,000 Microsoft Corp. $1,525,500 $6,780,000 $8,305,500
14,000 54,000 68,000 PeopleSoft, Inc. $625,625 $2,413,125 $3,038,750
47,000 189,956 236,956 Sterling Commerce, Inc. $2,144,375 $8,666,743 $10,811,118
------------- ------------- -------------
$4,907,500 $20,078,368 $24,985,868

Containers and Packaging
14,400 59,400 73,800 Crown Cork & Seal Company, Inc. $777,600 $3,207,600 $3,985,200
Drugs
26,300 100,800 127,100 Forest Laboratories, Inc. $1,645,394 $6,306,300 $7,951,694
14,000 56,000 70,000 Intelligent Polymers Ltd. (and warrants) $360,500 $1,442,000 $1,802,500
120,000 191,000 311,000 Mylan Laboratories, Inc. $2,445,000 $3,891,625 $6,336,625
10,000 38,000 48,000 SmithKline Beecham plc ADR $618,750 $2,351,250 $2,970,000
11,400 43,000 54,400 Warner-Lambert Co. $1,667,250 $6,288,750 $7,956,000
------------- ------------- -------------
$6,736,894 $20,279,925 $27,016,819

Electronic-Semiconductor
11,000 42,000 53,000 Intel Corp. $986,563 $3,766,875 $4,753,438
23,400 95,700 119,100 Motorola, Inc. $1,304,550 $5,335,275 $6,639,825
------------- ------------- -------------
$2,291,113 $9,102,150 $11,393,263

<PAGE>

<CAPTION>
SHARES PAR (HISTORICAL) SECURITY MARKET AMOUNT (HISTORICAL)
- ------------ ------------- -------------- -------------------------------- -------------------------- -------------- --------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED FUND FUND COMBINED
- ------------ ------------- -------------- -------------------------------- -------------------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Financial Services
5,000 20,000 25,000 American Express Co. $450,313 $1,801,250 $2,251,563
40,000 234,000 274,000 Fannie Mae $2,552,500 $14,932,125 $17,484,625
66,000 265,000 331,000 MBNA Corp. $2,363,625 $9,490,312 $11,853,937
34,000 136,000 170,000 MGIC Investment Corp. $2,505,375 $10,021,500 $12,526,875
------------- ------------- -------------
$7,871,813 $36,245,187 $44,117,000

Food
105,000 409,500 514,500 Archer-Daniels-Midland Co. $2,355,938 $9,188,156 $11,544,094
29,000 113,000 142,000 Groupe Danone ADR $1,156,375 $4,505,875 $5,662,250
25,000 100,000 125,000 Nabisco Holdings Corp. Class A $1,179,687 $4,718,750 $5,898,437
------------- ------------- -------------
$4,692,000 $18,412,781 $23,104,781

Health Care Services
15,000 60,000 75,000 Cardinal Health, Inc. $1,228,125 $4,912,500 $6,140,625
Hotel and Gaming
22,000 91,000 113,000 Sun International Hotels Ltd. $957,000 $3,958,500 $4,915,500
48,500 231,000 279,500 Mirage Resorts, Inc. $1,109,438 $5,284,125 $6,393,563
------------- ------------- -------------
$2,066,438 $9,242,625 $11,309,063

Insurance
28,000 105,000 133,000 American International Group, Inc. $3,365,250 $12,619,688 $15,984,938
46,400 164,100 210,500 Hartford Life, Inc. Class A $1,998,100 $7,066,556 $9,064,656
------------- ------------- -------------
$5,363,350 $19,686,244 $25,049,594

Leisure Time-Amusements
5,000 20,000 25,000 Disney (Walt) Co. $559,688 $2,238,750 $2,798,438
26,000 100,000 126,000 Royal Olympic Cruise Lines, Inc. $390,000 $1,500,000 $1,890,000
------------- ------------- -------------
$949,688 $3,738,750 $4,688,438

Machinery-Oil and Well
20,000 87,000 107,000 Baker Hughes, Inc. $818,750 $3,561,562 $4,380,312
Medical Technology
43,000 166,000 209,000 Medtronic, Inc. (with rights) $2,284,375 $8,818,750 $11,103,125
Motion Pictures
15,000 46,000 61,000 Cinar Films, Inc. Class B $555,000 $1,702,000 $2,257,000
Natural Gas Transmissions
24,000 90,000 114,000 Williams Companies, Inc. $784,500 $2,941,875 $3,726,375
Oil and Gas Field Services
10,000 50,500 60,500 Camco International, Inc. $585,000 $2,954,250 $3,539,250
30,000 106,500 136,500 Precision Drilling Corp. $553,125 $1,963,594 $2,516,719
18,000 114,000 132,000 Schlumberger Ltd. ADR $1,356,750 $8,592,750 $9,949,500
------------- ------------- -------------
$2,494,875 $13,510,594 $16,005,469

Oil-Crude Petroleum and Gas
0 37,000 37,000 EVI, Inc. $0 $1,815,313 $1,815,313
29,800 123,600 153,400 Nuevo Energy Co. $1,069,074 $4,434,150 $5,503,224
64,000 259,000 323,000 Santa Fe Energy Resources, Inc. $716,000 $2,897,562 $3,613,562
------------- ------------- -------------
$1,785,074 $9,147,025 $10,932,099

Oil-offshore Drilling
13,000 52,000 65,000 Santa Fe International Corp. $460,688 $1,842,750 $2,303,438
Paper
20,000 85,000 105,000 St. Joe Corp. $682,500 $2,900,625 $3,583,125
Pollution Control
46,000 181,000 227,000 U.S. Filter Corp. $1,561,125 $6,142,688 $7,703,813
Precision Instruments-Test, R
6,900 28,700 35,600 Perkin-Elmer Corp. $504,994 $2,100,481 $2,605,475
Publishing
4,600 18,300 22,900 CMP Media, Inc. Class A $108,675 $432,337 $541,012
18,000 71,000 89,000 Time Warner, Inc. $1,215,000 $4,792,500 $6,007,500
------------- ------------- -------------
$1,323,675 $5,224,837 $6,548,512

Retail-Department Stores
25,000 155,000 180,000 Kohl's Corp. $2,004,688 $12,429,063 $14,433,751

<PAGE>

<CAPTION>
SHARES PAR (HISTORICAL) SECURITY MARKET AMOUNT (HISTORICAL)
- ------------ ------------- -------------- -------------------------------- -------------------------- -------------- --------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED FUND FUND COMBINED
- ------------ ------------- -------------- -------------------------------- -------------------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Retail-Specialty
54,375 210,950 265,325 Cendant Corp. $2,039,063 $7,910,625 $9,949,688
47,000 187,000 234,000 Costco Companies, Inc. $2,297,125 $9,139,625 $11,436,750
40,849 235,599 276,448 Home Depot, Inc. $2,606,677 $15,034,161 $17,640,838
------------- ------------- -------------
$6,942,865 $32,084,411 $39,027,276

Retail-Variety and Variety Mall
27,100 99,900 127,000 Walgreen Co. $994,231 $3,665,081 $4,659,312
Telecommunication Equipment
15,500 59,000 74,500 Ericsson (L.M.) Telephone Co. Class B ADR $702,344 $2,673,437 $3,375,781
20,000 77,000 97,000 Tellabs, Inc. $1,207,500 $4,648,875 $5,856,375
------------- ------------- -------------
$1,909,844 $7,322,312 $9,232,156

Telephone Services
51,000 204,000 255,000 AirTouch Communications, Inc. $2,291,811 $9,167,250 $11,459,061
26,000 100,000 126,000 Frontier Corp. $719,875 $2,768,750 $3,488,625
10,000 38,000 48,000 Intermedia Communications, Inc. $763,750 $2,902,250 $3,666,000
20,000 76,000 96,000 MCI Communications Corp. $956,250 $3,633,750 $4,590,000
69,008 271,000 340,008 WorldCom, Inc. $2,635,243 $10,348,813 $12,984,056
------------- ------------- -------------
$7,366,929 $28,820,813 $36,187,742

Toys
64,057 258,043 322,100 Mattel, Inc. $2,710,411 $10,918,444 $13,628,855
Utilities-Electric
48,000 188,000 236,000 AES Corp. $2,112,000 $8,272,000 $10,384,000
40,100 166,000 206,100 UniSource Energy Corp. Holding Company $684,206 $2,832,375 $3,516,581
------------- ------------- -------------
$2,796,206 $11,104,375 $13,900,581

Waste Disposal
23,000 91,000 114,000 U.S.A Waste Services, Inc. $957,375 $3,787,876 $4,745,251
------------- ------------- -------------
TOTAL COMMON STOCK $90,979,856 $371,962,617 $462,942,473

SHORT-TERM INVESTMENTS
----------------------
Banks
3,941 13,802 17,743 U.S. Bank N.A. Money Market Variable Rate $3,941 $13,802 $17,743
Time Deposit
Investment Company
1,727,754 12,442,832 14,170,586 Norwest Advantage Cash Investment Fund $1,727,754 $12,442,832 $14,170,586
Diversified Finance
4,023,000 0 4,023,000 Norwest Bank Associates Corp., $4,023,000 $0 $4,023,000
Master Variable Rate
------------- ------------- -------------
TOTAL SHORT-TERM INVESTMENTS $5,754,695 $12,456,634 $18,211,329
------------- ------------- -------------
TOTAL INVESTMENTS $96,734,551 $384,419,251 $481,153,802
------------- ------------- -------------
------------- ------------- -------------
COST $60,238,188 $229,905,906 $290,144,094

</TABLE>

<PAGE>

PROFORMA STATEMENT OF ASSETS AND LIABILITIES
At February 28, 1998 ( Unaudited)

<TABLE>
<CAPTION>
ACQUIRED ACQUIRING
FUND FUND
2/28/98 2/28/98 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
------------ ------------ ------------ --------------
<S> <C> <C> <C> <C>
ASSETS
Investments , at value (Note 2) $96,734,551 $384,419,251 $481,153,802
Cash 0 0 0
Collateral for securities lending transactions (Note 2) 23,866,251 99,480,733 123,346,984
Receivables:
Investment securities sold 441,655 2,251,612 2,693,267
Interest and dividends 61,604 184,171 245,775
Subscriptions of capital stock 128,318 5,976 134,294
Deferred registration costs 32,835 21,894 54,729
Prepaid expenses 7,384 8,018 15,402
------------ ------------ ------------ --------------
TOTAL ASSETS 121,272,598 486,371,655 0 607,644,253
------------ ------------ ------------ --------------
LIABILITIES
Payable upon return of securities loaned (Note 2) 23,866,251 99,480,733 123,346,984
Payable for investment securities purchased 498,648 1,994,593 2,493,241
Redemptions of capital stock 30,820 47,442 78,262
Payable for investment advisory and management fees 72,379 236,246 308,625
Payable for distribution fees 1,874 6,400 8,274
Accounts payable and accrued expenses 19,534 37,901 57,435
------------ ------------ ------------ --------------
TOTAL LIABILITIES 24,489,506 101,803,315 0 126,292,821
------------ ------------ ------------ --------------
NET ASSETS
Net proceeds of capital stock, par value $.01 per share 50,752,885 207,871,629 258,624,514
Unrealized appreciation of investments 36,496,363 154,513,345 191,009,708
Net investment loss (303,963) (647,914) (951,877)
Accumulated net realized gain from sale of investments 9,837,807 22,831,280 32,669,087
------------ ------------ ------------ --------------
TOTAL NET ASSETS $96,783,092 $384,568,340 0 $481,351,432
------------ ------------ ------------ --------------
------------ ------------ ------------ --------------

OUTSTANDING SHARES
Class A 1,893,644 14,614,375 1,527,425 (a) 18,035,444
Class B 92,333 376,929 73,813 (a) 543,075
Class C 25,485 83,892 20,382 (a) 129,759
Class H 191,822 700,462 152,858 (a) 1,045,142

NET ASSET VALUE
Class A $44.11 $24.42 1.80630631 $24.42
Class B $42.83 $23.81 1.79882402 $23.81
Class C $42.85 $23.81 1.79966401 $23.81
Class H $42.83 $23.83 1.79731431 $23.83

</TABLE>

See accompanying notes to proforma financial statements.

(a) Reflects increase in shares due to differences in the net asset values of
the funds.

<PAGE>

PROFORMA STATEMENT OF OPERATIONS
For the year ending February 28, 1998 (Unaudited)

Acquired Acquiring
Fund Fund
02/28/98 02/28/98 Proforma Proforma
(Historical) (Historical) Adjustments Combined
------------ ------------ ------------ --------------
<S> <C> <C> <C> <C>
Net Investment Income:
Income
Interest Income $310,546 $1,338,301 $1,648,847
Dividend Income 375,555 1,546,911 1,922,466
Fee income (Note 2) 59,417 189,103 248,520
------------ ------------ ------------ --------------
Total Income 745,518 3,074,315 0 3,819,833
------------ ------------ ------------ --------------
Expenses:
Investment advisory and management fees (Note 2) 901,691 2,908,610 (270,434)(b) 3,539,867
Distribution fees (Note 2) 299,230 1,046,922 0 1,346,152
Shareholders' notices and reports 21,374 74,518 0 95,892
Legal and auditing fees (Note 2) 29,258 44,808 (17,000)(a) 57,066
Registration fees 39,622 83,705 (37,622)(a) 85,705
Custodian fees 24,203 46,795 (8,000)(a) 62,998
Directors' fees and expenses 17,473 18,344 (3,000)(a) 32,817
Other 8,275 30,213 0 38,488
------------ ------------ ------------ --------------
Total Expenses 1,341,126 4,253,915 (336,056) 5,258,985
------------ ------------ ------------ --------------
Net Investment Income (Loss) (595,608) (1,179,600) 336,056 (1,439,152)
------------ ------------ ------------ --------------
Realized and Unrealized Gain (Loss) on Investments
Net realized gain from security transactions 15,073,428 48,073,503 63,146,931
Net change in unrealized appreciation (depreciation) of
investments in securities 9,695,528 48,314,617 58,010,145
------------ ------------ ------------ --------------
Net Gain on Investments 24,768,956 96,388,120 0 121,157,076
------------ ------------ ------------ --------------
Net Increase in Net Assets Resulting from Operations $24,173,348 $95,208,520 $336,056 $119,717,924
------------ ------------ ------------ --------------
------------ ------------ ------------ --------------
</TABLE>

See accompanying notes to pro forma financial statements.

(a) Reflects reduction in expenses due to elimination of duplicate services.
(Note 3)

(b) Reflects lower advisory fees due to breakpoints in the advisory fee
schedule. (Note 3)

<PAGE>

PRO FORMA FOOTNOTES OF MERGER BETWEEN ACQUIRED FUND AND ACQUIRING FUND
FEBRUARY 28, 1998 (UNAUDITED)

1. GENERAL

The accompanying pro forma financial statements are presented to show the effect
of the proposed acquisition of Fortis Fiduciary Fund, Inc. (Acquired Fund) by
Fortis Equity Portfolios, Inc. - Fortis Capital Fund (Acquiring Fund) as if such
acquisition had taken place as of the close of business on February 28, 1998.

Under the terms of the Agreement and Plan of Reorganization, the combination of
the Acquired Fund and the Acquiring Fund will be taxed as a tax-free business
combination and accordingly will be accounted for by a method of accounting for
tax-free mergers of investment companies (sometimes referred to as the pooling
without restatement method). The acquisition would be accomplished by an
acquisition of the net assets of the Acquired Fund in exchange for shares of the
Acquiring Fund at net asset value. The statements of assets and liabilities and
the related statements of operations of the Acquired Fund and the Acquiring Fund
have been combined as of and for the year ended February 28, 1998.

The accompanying pro forma financial statements should be read in conjunction
with the financial statements and schedule of investments of the Acquiring Fund
which are included in its semi-annual report dated February 28, 1998.

The pro forma combining schedules of investments do not reflect any changes
which could occur before or after the acquisition closing date due to changes in
market conditions or differences in investment management practices of the
Acquiring Fund compared with the Acquired Fund. However, aside from portfolio
decisions made as a result of market condition changes that have or may occur
between the date of the pro forma financial statements and the acquisition
closing date, management does not have any specific plans at this time
regarding the disposition of investments presented in the pro forma schedules
of investments that would have a material impact on the presentation of such
schedules.

The following notes refer to the accompanying pro forma financial statements as
if the above mentioned acquisition of the Acquired Fund and the Acquiring Fund
had taken place as of the close of business on February 28, 1998.

2. SIGNIFICANT ACCOUNTING POLICIES

The Acquiring Fund is a Minnesota corporation, registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company.

The Acquiring Fund began to issue multiple class shares effective November 14,
1994. Class A shares are sold with a front-end sales charge. Class B and H
shares are sold without a front-end sales charge and may be subject to a
contingent deferred sales charge for six years, and such

<PAGE>

shares automatically convert to Class A after eight years. Class C shares are
sold without a front-end sales charge and may be subject to contingent deferred
sales charge for one year. All classes of shares have identical voting,
dividend, liquidation and other rights and the same terms and conditions, except
that the level of distribution fees charged differs between classes. Income,
expenses (other than expenses incurred under each class's distribution
agreement) and realized and unrealized gains or losses on investments are
allocated to each class of shares based on its relative net assets.

The significant accounting policies followed by the Acquiring Fund are
summarized as follows:

SECURITY VALUATION: Investments in securities traded on a national securities
exchange or on the NASDAQ National Market System are valued at the last reported
sales price. Securities for which over-the-counter market quotations are
readily available are valued on the basis of the last current bid price. An
outside pricing service may be utilized to provide such valuations. Securities
for which quotations are not readily available are valued at fair value as
determined in good faith by management under supervision of the Board of
Directors. Short-term investments, with maturities of less than 60 days when
acquired, or which subsequently are within 60 days of maturity, are valued at
amortized cost.

SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
accounted for on the trade date and dividend income is recorded on the
ex-dividend date. Interest income is recorded on the accrual basis. Realized
security gains and losses are determined using the identified cost method.

LENDING OF PORTFOLIO SECURITIES: At February 28, 1998, securities were on loan
to brokers from the Acquiring Fund. For collateral, the Fund's custodian
received cash which is maintained in a separate account and invested by the
custodian in short-term investment vehicles. The risks to the Fund in security
lending transactions are that the borrower may not provide additional collateral
when required or return the securities when due and that the proceeds from the
sale of investments made with cash collateral received will be less than amounts
required to be returned to the borrowers.

INCOME TAXES: The portfolio intends to qualify, under the Internal Revenue Code,
as a regulated investment company, and, if so qualified, will not have to pay
federal income taxes to the extent that its taxable net income is distributed.
On a calendar year basis, the Acquiring Fund intends to distribute substantially
all of its net investment income and realized gains, if any, to avoid payment of
federal excise taxes.

Net investment income and net realized gains may differ for financial statement
and tax purposes. The character of distributions made during the year from net
investment income or net realized gains may, therefore, differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the fund.

USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted

<PAGE>

accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increase and decrease in net assets from operations
during the reporting period. Actual results could differ from those estimates.

PAYMENTS TO RELATED PARTIES: Fortis Advisers, Inc. (Advisers), is the investment
adviser for the Acquiring Fund. Investment advisory and management fees are
computed at an annual rate of 1% of the first $100 million of average daily net
assets, .80% for the next $150 million, and .70% for average daily net assets
over $250 million of each portfolio.

In addition to the investment advisory and management fee, Classes A, B, C and H
pay Fortis Investors, Inc. (the Acquiring Fund's principal underwriter)
distribution fees equal to .25% of average daily net assets for Class A and
1.00% of average daily net assets for Classes B, C and H on an annual basis, to
be used to compensate those who sell shares of the fund and to pay certain other
expenses of selling fund shares.

3. PRO FORMA ADJUSTMENTS

The accompanying pro forma financial statements reflect changes in fund shares
as if the merger had taken place on February 28, 1998, and adjustments made to
expenses for duplicated services and lower advisory fees as a result of
breakpoints in the advisory fee schedule that would not have been incurred.

<PAGE>
PART C
OTHER INFORMATION

Fortis Equity Portfolios, Inc.

ITEM 15. INDEMNIFICATION

Refer to Post-Effective Amendment No. 66 to the Registrant's Registration
Statement filed with the Commission in Janary 1988, which is incorporated herein
by reference.

ITEM 16. EXHIBITS

1. Articles of Incorporation (3) and (4)
2. Bylaws (5)
3. Not applicable
4. Agreement and Plan of Reorganization, attached as Axhibit A to the
Prospectus/Proxy Statement included in Part A of this Registration
Statement on Form N-14.
5. Not applicable
6. Investment Advisory and Management Agreement (1) and (4)
7. Underwriting Agreement (3) and (4)
8. Not applicable
9. Custody Agreement (2)
10. Not applicable
* 11. Opinion and consent of Dorsey & Whitney LLP with respect to the
legality of the securities being registered
** 12. Opinion and consent of Dorsey & Whitney LLP with respect to tax
matters
13. Not applicable
* 14. Consent of KPMG Peat Marwick LLP
* 16. Powers of Attorney of Directors signing the Registration Statement
* 17. Form of proxy card

- ---------------------
(1) Incorporated by reference to Post-Effective Amendment No. 70 to the
Registrant's Registration Statement on Form N-1A filed with the Commission
in February 1992.
(2) Incorporated by reference to Post-Effective Amendment No. 71 to the
Registrant's Registration Statement on Form N-1A filed with the Commission
in November 1992.
(3) Incorporated by reference to Post-Effective Amendment No. 74 to the
Registrant's Registration Statement on Form N-1A filed with the Commission
in November 1994.
(4) Incorporated by reference to Post-Effective Amendment No. 76 to the
Registrant's Registration Statement on Form N-1A filed with the Commission
in October 1995.

<PAGE>

(5) Incorporated by reference to Post-Effective Amendment No. 77 to the
Registrant's Registration Statement on Form N-1A filed with the Commission
in December 1995.
(*) Filed herewith.
(**) To be filed by amendment

ITEM 17. UNDERTAKINGS

(1) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of a prospectus which is
a part of this Registration Statement by any person or party who is deemed to be
an underwriter within the meaning of Rule 145(c) of the Securities Act, the
reoffering prospectus will contain the information called for by the applicable
registration form for reofferings by persons who may be deemed underwriters, in
addition to the information called for by the other items of the applicable
form.

(2) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as a part of an amendment to the
Registration Statement and will not be used until the amendment is effective.
and that, in determining any liability under the 1933 Act, each post-effective
amendment shall be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time shall be deemed
to be the initial bona fide offering of them.

(3) The undersigned Registrant agrees to file, by post-effective
amendment, an opinion of counsel or a copy of a ruling of the Internal Revenue
Service supporting the tax consequences of the proposed reorganization within a
reasonable time after receipt of such opinion or ruling.

2
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Woodbury and State of Minnesota on the 14th day of
August 1998.

FORTIS EQUITY PORTFOLIOS, INC.
(Registrant)

By /s/ Dean C. Kopperud
-----------------------------
Dean C. Kopperud, President

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

/s/ Dean C. Kopperud President (principal August 14, 1998
- -------------------------------- executive officer)
Dean C. Kopperud

/s/ Tamara L. Fagely Treasurer (principal August 14, 1998
- -------------------------------- financial and
Tamara L. Fagely accounting officer)

Richard D. Cutting* Director

Allen R. Freedman* Director

Robert M. Gavin* Director

Benjamin S. Jaffray* Director

Jean L. King* Director

Edward M. Mahoney* Director

Robb L. Prince* Director

Leonard J. Santow* Director

Noel S. Shadko Director

Joseph M. Wikler* Director

*By /s/ Dean C. Kopperud August 14, 1998
----------------------------
Dean C. Kopperud, Attorney-in-Fact

<PAGE>
EXHIBIT 11
DORSEY & WHITNEY LLP
Pillsbury Center South
220 South Sixth Street
Minneapolis, Minnesota 55402-1498

_______, 1998

Fortis Equity Portfolios, Inc.
500 Bielenberg Drive
Woodbury, Minnesota 55125

Re: Fortis Capital Fund, a series of Fortis Equity Portfolios, Inc.
Shares to be Issued Pursuant to Agreement and Plan of Reorganization

Ladies and Gentlemen:

We have acted as counsel to Fortis Equity Portfolios, Inc., a
Minnesota corporation ("Fortis Equity"), in connection with its authorization
and proposed issuance of Class A, Class B, Class C and Class H common shares of
Fortis Capital Fund, par value $.01 per share (the "Shares"). The Shares are to
be issued pursuant to an Agreement and Plan of Reorganization (the "Agreement"),
by and between Fortis Equity and Fortis Fiduciary Fund, Inc., a Minnesota
corporation, the form of which Agreement is included as Exhibit A to the
Prospectus/Proxy Statement relating to the transactions contemplated by the
Agreement included in Fortis Equity's Registration Statement on Form N-14 filed
with the Securities and Exchange Commission (the "Registration Statement").

In rendering the opinions hereinafter expressed, we have reviewed the
corporate proceedings taken by Fortis Equity in connection with the
authorization and issuance of the Shares, and we have reviewed such questions of
law and examined copies of such corporate records of Fortis Equity, certificates
of public officials and of responsible officers of Fortis Equity, and other
documents as we have deemed necessary as a basis for such opinions. As to the
various matters of fact material to such opinions, we have, when such facts were
not independently established, relied to the extent we deem proper on
certificates of public officials and of responsible officers of Fortis Equity.
In connection with such review and examination, we have assumed that all copies
of documents provided to us conform to the originals; that all signatures are
genuine; and that prior to the consummation of the transactions contemplated
thereby, the Agreement will have been duly and validly executed and delivered on
behalf of each of the parties thereto in substantially the form included in the
Registration Statement.

<PAGE>

Based on the foregoing, it is our opinion that:

1. Fortis Equity is validly existing as a corporation in good
standing under the laws of the State of Minnesota.

2. The Shares, when issued and delivered by Fortis Equity pursuant
to, and upon satisfaction of the conditions contained in, the Agreement, will be
duly authorized, validly issued, fully paid and non-assessable.

In rendering the foregoing opinions (a) we express no opinion as to
the laws of any jurisdiction other than the State of Minnesota; and (b) we have
assumed, with your concurrence, that the conditions to closing set forth in the
Agreement will have been satisfied.

We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to this firm under the caption
"Legal Matters" in Fortis Equity's final Prospectus/Proxy Statement relating to
the Shares included in the Registration Statement.

Very truly yours,

KLP /s/ Dorsey & Whitney LLP

<PAGE>

INDEPENDENT AUDITOR'S CONSENT

The Board of Directors
Fortis Fiduciary Fund, Inc.
Fortis Equity Portfolios, Inc.:

We consent to the incorporation by reference in the registration statement on
Form N-14 (the "Registration Statement") of Fortis Equity Portfolios, Inc. of
our report dated October 10, 1997 relating to the financial statements and
financial highlights of Fortis Fiduciary Fund, Inc. and Fortis Capital Fund (a
fund within Fortis Equity Portfolios, Inc.) and the references to our Firm under
the heading "FINANCIAL STATEMENTS AND EXPERTS".

/s/ KPMG Peat Marwick LLP

Minneapolis, Minnesota
August 14, 1998

<PAGE>

FORTIS EQUITY PORTFOLIOS, INC.

POWER OF ATTORNEY -- N-14 REGISTRATION STATEMENT

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Dean C. Kopperud, Rhonda J.
Schwartz and Michael J. Radmer, and each of them, his or her true and lawful
attorneys-in-fact and agents, each acting alone, with full power of substitution
and resubstitution, for him or her and in his or her name, place and stead, in
any and all capacities, to sign a Registration Statement on Form N-14 of Fortis
Equity Portfolios, Inc. ("Fortis Equity") relating to the combination of Fortis
Fiduciary Fund, Inc. with and into the Fortis Capital Fund, a series of Fortis
Equity, and any and all amendments thereto, including post-effective amendments,
and to file the same with all exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, each acting alone, full power and authority to do
and perform to all intents and purposes as he or she might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, each acting alone, or the substitutes for such attorneys-in-fact and
agents, may lawfully do or cause to be done by virtue hereof.

Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Richard D. Cutting Director August 10, 1998
Richard D. Cutting

/s/Allen R. Freedman Director August 10, 1998
Allen R. Freedman

/s/ Robert M. Gavin Director August 10, 1998
Robert M. Gavin

/s/ Benjamin S. Jaffray Director August 10, 1998
Benjamin S. Jaffray

/s/ Jean L. King Director August 10, 1998
Jean L. King

/s/ Dean C. Kopperud Director August 10, 1998
Dean C. Kopperud

/s/ Edward M. Mahoney Director August 10, 1998
Edward M. Mahoney

/s/ Robb L. Prince Director August 10, 1998
Robb L. Prince

/s/ Leonard J. Santow Director August 10, 1998
Leonard J. Santow

/s/ Noel S. Shadko Director August 10, 1998
Noel S. Shadko

/s/ Joseph M. Wikler Director August 10, 1998
Joseph M. Wikler

</TABLE>

<PAGE>
EXHIBIT 17
PROXY

FORTIS FIDUCIARY FUND, INC.
500 BIELENBERG DRIVE, WOODBURY, MINNESOTA 55125
MAILING ADDRESS: P.O. BOX 64284, ST. PAUL, MINNESOTA 55164

THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF FORTIS
FIDUCIARY FUND, INC.

The undersigned hereby appoints Michael J. Radmer and Scott R. Plummer, and
each of them, with power to act without the other and with the right of
substitution in each, as proxies of the undersigned and hereby authorizes each
of them to represent and to vote, as designated below, all the shares of Fortis
Fiduciary Fund, Inc. (the "Acquired Fund") held of record by the undersigned on
_______, 1998, at the Special Meeting of shareholders of the Acquired Fund to be
held on ______, 1998, or any adjournments or postponements thereof, with all
powers the undersigned would possess if present in person. All previous proxies
given with respect to the Special Meeting hereby are revoked.

THE PROXIES ARE INSTRUCTED TO VOTE AS FOLLOWS:

1. PROPOSAL TO APPROVE AN AGREEMENT AND PLAN OF REORGANIZATION (the "Plan")
providing for (a) the acquisition of substantially all of the assets and
the assumption of all liabilities of the Acquired Fund by Fortis Capital
Fund (the "Acquiring Fund"), a separately managed series of Fortis Equity
Portfolios, Inc., in exchange for shares of common stock of the Acquiring
Fund having an aggregate net asset value equal to the aggregate value of
the assets acquired (less the liabilities assumed) of the Acquired Fund and
(b) the liquidation of the Acquired Fund and the pro rata distribution of
the Acquiring Fund shares to Acquired Fund shareholders. Under the Plan,
Acquired Fund shareholders will receive the same class of shares of the
Acquiring Fund that they held in the Acquired Fund, having a net asset
value equal as of the effective time of the Plan to the net asset value of
their Acquired Fund shares.

/ / FOR / / AGAINST / / ABSTAIN

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS GIVEN, THIS PROXY
WILL BE VOTED "FOR" PROPOSAL 1 ABOVE. RECEIPT OF THE NOTICE OF SPECIAL MEETING
OF SHAREHOLDERS AND THE PROXY STATEMENT RELATING TO THE MEETING IS ACKNOWLEDGED
BY YOUR EXECUTION OF THIS PROXY.

PLEASE SIGN THIS PROXY EXACTLY AS YOUR NAME APPEARS BELOW. WHEN SHARES ARE
HELD BY JOINT TENANTS, BOTH SHOULD SIGN. WHEN SIGNING AS ATTORNEY, EXECUTOR,
ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE GIVE FULL TITLE AS SUCH. IF A
CORPORATION, PLEASE SIGN IN FULL CORPORATE NAME BY PRESIDENT OR OTHER AUTHORIZED
OFFICER. IF A PARTNERSHIP, PLEASE SIGN IN PARTNERSHIP NAME BY PARTNER OR OTHER
AUTHORIZED PERSON.

DATED: _______________________, 199____

__________________________________
Signature
[SHAREHOLDER INFORMATION]

__________________________________
Signature if held jointly

TO SAVE FURTHER SOLICITATION EXPENSE, PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED POSTAGE-PREPAID ENVELOPE.