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THE ARCH FUND(R), INC.
(THE "FUND")
THE ARCH EQUITY INCOME PORTFOLIO
THE ARCH INTERMEDIATE CORPORATE BOND PORTFOLIO
INSTITUTIONAL SHARES
Supplement dated February 18, 1997
to the Prospectus dated May 13, 1996
(as revised January 21, 1997)
The expense table in the section entitled "EXPENSE SUMMARY FOR
INSTITUTIONAL SHARES" on page 3 of the Prospectus is amended and restated to
read as follows:
<TABLE>
<CAPTION>
Equity Intermediate
Income Corporate Bond
Portfolio Portfolio
--------- ---------
<S> <C> <C>
Annual Portfolio Operating
Expenses (as a percentage of
average net assets)
Investment Advisory Fees (net
of fee waivers)(1).................. .00% .00%
12b-1 Fees........................... .00% .00%
Other Expenses (including
administration fees,
administrative services
fees, sub-transfer agency fees
(if any), and other expenses)
(net of fee waivers and
expense reimbursements)(2)(3)........ .23% .23%
--- ---
Total Portfolio Operating
Expenses (net of
fee waivers and expense
reimbursements)(3) .................. .23% .23%
=== ===
- ---------------------------
</TABLE>
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(1) Without fee waivers, investment advisory fees for the Equity Income
and Intermediate Corporate Bond Portfolios would be .75% and .55%,
respectively.
(2) Without fee waivers, administrative fees for each Portfolio would be
0.20%. Administrative services fees are payable at an annual rate not
to exceed 0.30%.
(3) Without fee waivers and expense reimbursements, Other Expenses would
be .68% and .68% and Total Portfolio Operating Expenses would be
1.43% and 1.23% for the Equity Income and Intermediate Corporate Bond
Portfolios, respectively.
INVESTORS SHOULD RETAIN THIS SUPPLEMENT
WITH THE PROSPECTUS FOR FUTURE REFERENCE
