SELIGMAN FRONTIER FUND INC, 497, 1996-04-30

SELIGMAN FRONTIER FUND INC
497, 1996-04-30

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STATEMENT OF ADDITIONAL INFORMATION
April 22, 1996
SELIGMAN FRONTIER FUND, INC.

100 Park Avenue
New York, New York 10017
New York City Telephone (212) 850-1864
Toll Free Telephone (800) 221-2450 - all continental United States
For Retirement Plan Information - Toll-Free Telephone (800) 445-1777

This Statement of Additional Information expands upon and supplements
the information contained in the current Prospectus of Seligman Frontier Fund,
Inc. (the "Fund"), dated April 22, 1996. It should be read in conjunction with
the Prospectus, which may be obtained by writing or calling the Fund at the
above address or telephone numbers. This Statement of Additional Information,
although not in itself a Prospectus, is incorporated by reference into the
Prospectus in its entirety.

The Fund offers three classes of shares. Class A shares may be
purchased at net asset value plus a sales load of up to 4.75%. Class B shares
may be purchased at net asset value and are subject to a contingent deferred
sales load ("CDSL"), if applicable, in the following amount (as a percentage of
the current net asset value or the original purchase price, whichever is less,
if redemption occurs within the indicated number of years of purchase of such
shares: 5% (less than 1 year), 4% (1 but less than 2 years), 3% (2 but less than
4 years), 2% (4 but less than 5 years), 1% (5 but less than 6 years) and 0% (6
or more years). Class B shares automatically convert to Class A shares after
approximately eight years resulting in lower ongoing fees. Shares purchased
through reinvestment of dividends and distributions on Class B shares also will
convert automatically to Class A shares along with the underlying shares on
which they were earned. Class D shares may be purchased at net asset value and
are subject to a CDSL of 1% (of the current net asset value or the original
purchase price whichever is less) if redeemed within one year of purchase.

Each Class A, Class B and Class D share represents an identical legal
interest in the investment portfolio of the Fund and has the same rights except
for certain class expenses and except that Class B and Class D shares bear a
higher distribution fee that generally will cause the Class B and Class D shares
to have a higher expense ratio and pay lower dividends than Class A shares. Each
Class has exclusive voting rights with respect to its distribution plan.
Although holders of Class A, Class B and Class D shares have identical legal
rights, the different expenses borne by each Class will result in different net
asset values and dividends. The three classes also have different exchange
privileges.

TABLE OF CONTENTS

Page

Investment Objective, Policies and Risks............. 2
Investment Limitations............................... 3
Directors And Officers............................... 4
Management And Expenses ............................. 8
Administration, Shareholder Services And
Distribution Plan................................. 10
Portfolio Transactions............................... 11
Purchase And Redemption Of Fund Shares............... 11
Distribution Services................................ 14
Valuation............................................ 14
Performance.......................................... 15
General Information.................................. 16
Financial Statements................................. 16
Appendix............................................. 17

EQFR1A

1
<PAGE>

INVESTMENT OBJECTIVE, POLICIES AND RISKS

The Fund seeks to produce growth in capital value. Income may be considered
but will only be incidental to the Fund's investment objective of growth in
capital value. The following information regarding the Fund's investment
policies supplements the information contained in the Prospectus.

Lending of Portfolio Securities. The Fund may lend portfolio securities to
certain institutional borrowers of securities and may invest the cash collateral
and obtain additional income or receive an agreed upon amount of interest from
the borrower. Loans made by the Fund will generally be short-term. Loans are
subject to termination at the option of the Fund or the borrower. The Fund may
pay reasonable administrative and custodial fees in connection with a loan and
may pay a negotiated portion of the interest earned on the cash or equivalent
collateral to the borrower or placing broker. The Fund does not have the right
to vote securities on loan, but would terminate the loan and regain the right to
vote if that were considered important with respect to the investment.

Rights and Warrants. The Fund may invest in common stock rights and warrants
believed by the Manager to provide capital appreciation opportunities. Common
stock rights and warrants received as part of a unit or attached to securities
purchased (i.e., not separately purchased) are not included in the Fund's
investment restrictions regarding such securities.

The Fund may not invest in rights and warrants if, at the time of
acquisition, the investment in rights and warrants would exceed 5% of the Fund's
net assets, valued at the lower of cost or market. In addition, no more than 2%
of net assets may be invested in warrants not listed on the New York or American
Stock Exchanges. For purposes of this restriction, rights and warrants acquired
by the Fund in units or attached to securities may be deemed to have been
purchased without cost.

Purchasing Put Options on Securities. The Fund may purchase put options to
protect its portfolio holdings in an underlying security against a decline in
market value. This hedge protection is provided during the life of the put
option since the Fund, as holder of the put option, can sell the underlying
security at the put exercise price regardless of any decline in the underlying
security's market price. In order for a put option to be profitable, the market
price of the underlying security must decline sufficiently below the exercise
price to cover the premium and transaction costs. By using put options in this
manner, the Fund will reduce any profit it might otherwise have realized in the
underlying security by the premium paid for the put option and by transaction
costs.

Because a purchased put option gives the purchaser a right and not an
obligation, the purchaser is not required to exercise the option. If the
underlying position incurs a gain, the Fund would let the option expire
resulting in a reduced profit on the underlying security equal to the cost of
the put option. The cost of the put option is limited to the premium plus
commission paid. The Fund's maximum financial exposure will be limited to these
costs.

The Fund's ability to engage in option transaction may be limited by tax
considerations.

Repurchase Agreements. The Fund may enter into repurchase agreements with
commercial banks and with broker/dealers to invest cash for the short-term. A
repurchase agreement is an agreement under which the Fund acquires a money
market instrument, generally a U.S. Government obligation, subject to resale at
an agreed upon price and date. Such resale price reflects an agreed upon
interest rate effective for the period of time the instrument is held by the
Fund and is unrelated to the interest rate on the instrument. Repurchase
agreements could involve certain risks in the event of bankruptcy or other
default by the seller, including possible delays and expenses in liquidating the
securities underlying the agreement, decline in value of the underlying
securities and loss of interest.

Except as otherwise specifically noted above, the Fund's investment policies
are not fundamental and the Board of Directors of the Fund may change such
policies without the vote of a majority of its outstanding voting securities (as
defined on page 4).

2
<PAGE>

Portfolio Turnover. The Fund's portfolio turnover rate is calculated by dividing
the lesser of purchases or sales of portfolio securities for the fiscal year by
the monthly average of the value of the portfolio securities owned during the
fiscal year. Securities whose maturity or expiration date at the time of
acquisition were one year or less are excluded from the calculation. The Fund's
portfolio turnover rates for the fiscal years ended September 30, 1995 and 1994
were 71.52% and 124.76%, respectively.

INVESTMENT LIMITATIONS

Under the Fund's fundamental policies, which cannot be changed except by
vote of a majority of its outstanding voting securities, the Fund may not:

o Borrow money, except from banks for temporary or emergency purposes (but not
for the purchase of portfolio securities) in an amount not to exceed 15% of
the value of its total assets. The Fund will not purchase additional
portfolio securities if the Fund has outstanding borrowings in excess of 5%
of the value of its total assets;

o Purchase securities on "margin," or sell "short", or write or purchase put,
call, straddle or spread options, except that the Fund may make margin
deposits on future contracts, and may purchase put options solely for the
purpose of hedging against a decline in the price of securities held in the
Fund's portfolio;

o Invest more than 5% of its total assets, at market value, in securities of
any one issuer other than the U.S. Government, its agencies or
instrumentalities, buy more than 10% of the voting securities of any issuer,
or invest to control or manage any company;

o Invest more than 5% of the value of its total assets, at market value, in
securities of any company which, with their predecessors, have been in
operation less than three continuous years, provided, however, that
securities guaranteed by a company that (including predecessors) has been in
operation at least three continuous years shall be excluded from this
calculation;

o Invest more than 25% of the value of its total assets in any one industry;

o Invest in securities issued by other investment companies, except in
connection with a merger, consolidation, acquisition or reorganization;

o Purchase or sell commodities and commodity contracts other than stock index
futures contracts or purchase or hold real estate;

o Purchase or hold the securities of any issuer, if to its knowledge, directors
or officers of the Fund individually owning beneficially more than 0.5% of
the securities of that issuer own in the aggregate more than 5% of such
securities;

o Underwrite the securities of other issuers except insofar as the Fund may be
deemed an underwriter under the Securities Act of 1933, as amended, in
disposing of a portfolio security; or

o Make loans, except loans of portfolio securities (which loans would be fully
collateralized and marked to market daily) and except to the extent the
purchase of notes, bonds or other evidences of indebtedness, or the entry
into repurchase agreements may be considered loans.

Although not fundamental policies subject to shareholder vote, as long as the
Fund's shares are registered in certain states, it may not (l) mortgage, pledge
or hypothecate its assets to the extent that the value of such encumbered assets
exceeds 10% of the per share offering price (net asset value) of shares of the
Fund and (2) invest in interests in oil, gas or other mineral exploration or
development programs. The Fund may not invest more than 5% of the value of its
net assets, valued at the lower of cost or market, in warrants, of which no more
than 2% of net assets may be invested in warrants not listed on the New York or
American Stock Exchanges.

3
<PAGE>

Under the Investment Company Act of 1940 (the "1940 Act"), a "vote of a
majority of the outstanding voting securities" of the Fund means the affirmative
vote of the lesser of (l) more than 50% of the outstanding shares of the Fund or
(2) 67% or more of the shares present at a shareholders' meeting if more than
50% of the outstanding shares are represented at the meeting in person or by
proxy.

DIRECTORS AND OFFICERS

Directors and officers of the Fund, together with information as to their
principal business occupations during the past five years are shown below. Each
Director who is an "interested person" of the Fund, as defined in the 1940 Act,
is indicated by an asterisk. Unless otherwise indicated, their addresses are 100
Park Avenue, New York, NY 10017.

WILLIAM C. MORRIS* Director, Chairman of the Board, Chief
(57) Executive Officer and Chairman of the Executive
Committee

Managing Director, Chairman and President, J. &
W. Seligman & Co. Incorporated, investment
managers and advisers; and Seligman Advisors,
Inc., advisers; Chairman and Chief Executive
Officer, the Seligman Group of Investment
Companies; Chairman, Seligman Financial
Services, Inc., broker/dealer; Seligman
Holdings, Inc., holding company; Seligman
Services, Inc., broker/dealer; and Carbo
Ceramics Inc., ceramic proppants for oil and
gas industry; Director or Trustee, Seligman
Data Corp., shareholder service agent;
Kerr-McGee Corporation, diversified energy
company; and Sarah Lawrence College; and a
Member of the Board of Governors of the
Investment Company Institute; formerly,
Chairman, Seligman Securities, Inc.,
broker/dealer and J. & W. Seligman Trust
Company, trust company.

BRIAN T. ZINO* Director, President and Member of the Executive
(43) Committee

Director and Managing Director (formerly, Chief
Administrative and Financial Officer), J. & W.
Seligman & Co. Incorporated, investment
managers and advisers; and Seligman Advisors,
Inc., advisers; Director or Trustee, the
Seligman Group of Investment Companies;
President, the Seligman Group of Investment
Companies, except Seligman Quality Municipal
Fund, Inc. and Seligman Select Municipal Fund,
Inc.; Chairman, Seligman Data Corp.,
shareholder service agent; Director, Seligman
Financial Services, Inc., broker/ dealer;
Seligman Services, Inc., broker/dealer; and
Senior Vice President, Seligman Henderson Co.,
advisers; formerly, Director and Secretary,
Chuo Trust - JWS Advisors, Inc., advisers; and
Director, Seligman Securities, Inc.,
broker/dealer. and J. & W. Seligman Trust
Company, trust company.

FRED E. BROWN* Director
(82)
Director and Consultant, J. & W. Seligman & Co.
Incorporated, investment managers and advisers;
and Seligman Advisors, Inc, advisers; Director
or Trustee, the Seligman Group of Investment
Companies; Seligman Financial Services, Inc.,
broker/dealer; Seligman Services, Inc.,
broker/dealer; Trudeau Institute, Inc.,
nonprofit biomedical research organization;
Lake Placid Center for the Arts, cultural
organization; and Lake Placid Education
Foundation, education foundation; formerly,
Director, Seligman Securities, Inc.,
broker/dealer and J. & W. Seligman Trust
Company, trust company.

4
<PAGE>

JOHN R. GALVIN Director
(66)
Dean, Fletcher School of Law and Diplomacy at
Tufts University; Director or Trustee, the
Seligman Group of Investment Companies;
Chairman of the American Council on Germany; a
Governor of the Center for Creative Leadership;
Director of USLIFE, insurance; National
Committee on U.S.-China Relations, National
Defense University and the Institute for
Defense Analysis; and Consultant of Thomson
CSF, electronics. Formerly, Ambassador, U.S.
State Department; Distinguished Policy Analyst
at Ohio State University and Olin Distinguished
Professor of National Security Studies at the
United States Military Academy. From June, 1987
to June, 1992, he was the Supreme Allied
Commander, Europe and the Commander-in-Chief,
United States European Command. Tufts
University, Packard Avenue, Medford, MA 02155

ALICE S. ILCHMAN Director
(60)
President, Sarah Lawrence College; Director or
Trustee, the Seligman Group of Investment
Companies; Chairman, The Rockefeller
Foundation, charitable foundation; and
Director, NYNEX, telephone company; and the
Committee for Economic Development; formerly,
Trustee, The Markle Foundation, philanthropic
organization; and Director, International
Research and Exchange Board, intellectual
exchanges. Sarah Lawrence College, Bronxville,
New York 10708

FRANK A. McPHERSON Director
(62)
Chairman of the Board and Chief Executive
Officer, Kerr-McGee Corporation, energy and
chemicals; Director or Trustee, the Seligman
Group of Investment Companies; Director,
Kimberly-Clark Corporation, consumer products,
Bank of Oklahoma Holding Company, American
Petroleum Institute, Oklahoma City Chamber of
Commerce, Baptist Medical Center, Oklahoma
Chapter of the Nature Conservancy, Oklahoma
Medical Research Foundation and United Way
Advisory Board; Chairman, Oklahoma City Public
Schools Foundation; and Member of the Business
Roundtable and National Petroleum Council. 123
Robert S. Kerr Avenue, Oklahoma City, OK 73102

JOHN E. MEROW* Director
(66)
Chairman and Senior Partner, Sullivan &
Cromwell, law firm; Director or Trustee, the
Seligman Group of Investment Companies; The
Municipal Art Society of New York, Commonwealth
Aluminum Corporation, the U.S. Council for
International Business and the U.S.-New Zealand
Council; Chairman, American Australian
Association; Member of the American Law
Institute and Council on Foreign Relations;
Member of the Board of Governors of Foreign
Policy Association and New York Hospital. 125
Broad Street, New York, NY 10004

BETSY S. MICHEL Director
(53)
Attorney; Director or Trustee, the Seligman
Group of Investment Companies; and Chairman of
the Board of Trustees of St. George's School
(Newport, RI); formerly, Director, the National
Association of Independent Schools (Washington,
D.C.). St. Bernard's Road, Gladstone, NJ 07934

5
<PAGE>

JAMES C. PITNEY Director
(69)
Partner, Pitney, Hardin, Kipp & Szuch, law
firm; Director or Trustee, the Seligman Group
of Investment Companies and Public Service
Enterprise Group, public utility. Park Avenue
at Morris County, P.O. Box 1945, Morristown, NJ
07962-1945

JAMES Q. RIORDAN Director
(68)
Director, Various Corporations; Director or
Trustee, the Seligman Group of Investment
Companies; The Brooklyn Museum; The Brooklyn
Union Gas Company; the Committee for Economic
Development; Dow Jones & Co. Inc. and Public
Broadcasting Service; formerly, Co-Chairman of
the Policy Council of the Tax Foundation;
Director and Vice Chairman, Mobil Corporation;
Director, Tesoro Petroleum Companies, Inc. and
Director and President, Bekaert Corporation.
675 Third Avenue, Suite 3004, New York, NY
10017

RONALD T. SCHROEDER* Director and Member of the Executive Committee
(48)
Director, Managing Director and Chief
Investment Officer, Institutional, J. & W.
Seligman & Co. Incorporated, investment
managers and advisers; and Seligman Advisors,
Inc., advisers; Director or Trustee, the
Seligman Group of Investment Companies;
Director, Seligman Holdings, Inc., holding
company; Seligman Financial Services, Inc.,
broker/dealer; Seligman Henderson Co.,
advisers; and Seligman Services, Inc.,
broker/dealer; formerly, President, the
Seligman Group of Investment Companies, except
Seligman Quality Municipal Fund, Inc. and
Seligman Select Municipal Fund, Inc.; and
Director, J. & W. Seligman Trust Company, trust
company; Seligman Data Corp., shareholder
service agent; and Seligman Securities, Inc.,
broker/dealer.

ROBERT L. SHAFER Director
(63)
Vice President, Pfizer Inc., pharmaceuticals;
Director or Trustee, the Seligman Group of
Investment Companies; and USLIFE Corporation,
life insurance. 230 Park Avenue, New York, NY
10169 - 0079

JAMES N. WHITSON Director
(60)
Executive Vice President, Chief Operating
Officer and Director, Sammons Enterprises,
Inc., Director or Trustee, the Seligman Group
of Investment Companies, Red Man Pipe and
Supply Company, piping and other materials; and
C-SPAN. 300 Crescent Court, Suite 700, Dallas,
TX 75202

ARSEN MRAKOVCIC Vice President and Portfolio Manager
(31)
Managing Director (formerly, Vice President,
Investment Officer), J. & W. Seligman & Co.
Incorporated, investment managers and advisers;
and Vice President and Portfolio Manager, one
other open-end investment company in the
Seligman Group of Investment Companies;
formerly, Portfolio Assistant, J. & W. Seligman
& Co. Incorporated.

6
<PAGE>

LAWRENCE P. VOGEL Vice President
(39)
Senior Vice President, Finance, J. & W.
Seligman & Co. Incorporated, investment
managers and advisers; Seligman Financial
Services, Inc., broker/dealer; and Seligman
Advisors, Inc., advisers; Vice President , the
Seligman Group of Investment Companies; Senior
Vice President, Finance (formerly, Treasurer)
Seligman Data Corp., shareholder service agent,
Treasurer, Seligman Holdings, Inc., holding
company; and Seligman Henderson Co. advisers;
formerly, Senior Vice President, Seligman
Securities, Inc., broker/dealer; and Vice
President, Finance, J. & W. Seligman Trust
Company, trust company.

FRANK J. NASTA Secretary
(31)
Senior Vice President, Law and Regulation and
Corporate Secretary, J. & W. Seligman & Co.
Incorporated, investment managers and advisers;
and Seligman Advisors, Inc, advisers; Corporate
Secretary, the Seligman Group of Investment
Companies, Seligman Financial Services, Inc.,
broker/dealer; Seligman Henderson Co.,
advisers; Seligman Services, Inc.,
broker/dealer; Chuo Trust - JWS Advisors, Inc.,
advisers; and Seligman Data Corp., shareholder
service agent; formerly, Secretary, J. & W.
Seligman Trust Co., trust company and attorney,
Seward & Kissel, law firm.

THOMAS G. ROSE Treasurer
(38)
Treasurer, the Seligman Group of Investment
Companies and Seligman Data Corp., shareholder
service agent; formerly, Treasurer, American
Investors Advisors, Inc. and the American
Investors Family of Funds.

The Executive Committee of the Board acts on behalf of the Board between
meetings to determine the value of securities and assets owned by the Fund for
which no market valuation is available and to elect or appoint officers of the
Fund to serve until the next meeting of the Board.

<TABLE>
<CAPTION>
Compensation Table

Pension or Total Compensation
Aggregate Retirement Benefits from Registrant and
Name and Compensation Accrued as part of Fund Complex Paid
Position with Registrant from Registrant (1) Fund Expenses to Directors (2)
------------------------ ------------------- ------------- ----------------
<S> <C> <C> <C>
William C. Morris, Director and Chairman N/A N/A N/A
Brian T. Zino, Director and President N/A N/A N/A
Ronald T. Schroeder, Director N/A N/A N/A
Fred E. Brown, Director N/A N/A N/A
John R. Galvin, Director $1,516.02 N/A $41,252.75
Alice S. Ilchman, Director 2,497.36 N/A 68,000.00
Frank A. McPherson, Director 1,516.02 N/A 41,252.75
John E. Merow, Director 2,425.94(d) N/A 66,000.00(d)
Betsy S. Michel, Director 2,675.94 N/A 67,000.00
Douglas R. Nichols, Jr., Director* 909.92 N/A 24,747.25
James C. Pitney, Director 2,497.36 N/A 68,000.00
James Q. Riordan, Director 2,783.08 N/A 70,000.00
</TABLE>

7
<PAGE>

<S> <C> <C> <C>
Herman J. Schmidt, Director* 909.92 N/A 24,747.25
Robert L. Shafer, Director 2,783.07 N/A 70,000.00
James N. Whitson, Director 2,711.66(d) N/A 68,000.00(d)

</TABLE>
- ----------------------
(1) For the year ended December 31, 1995.

(2) As defined in the Fund's Prospectus, the Seligman Group of Investment
Companies consists of seventeen investment companies.

* Retired May 18, 1995.

(d) Deferred.

The Fund has a compensation arrangement under which outside directors may
elect to defer receiving their fees. Under this arrangement, interest will be
accrued on the deferred balances. The annual cost of such interest will be
included in the directors' fees and expenses, and the accumulated balance
thereof at September 30, 1995, of $41,407, is included in "Other Liabilities" in
the Fund's financial statements.

Directors and officers of the Fund are also directors and officers of some or
all of the other investment companies in the Seligman Group. Directors and
officers of the Fund as a group owned less than 1% of the Fund's Class A Capital
Stock at March 29, 1996. As of that date, no Directors or officers owned shares
of the Fund's Class D Capital Stock.

As of March 29, 1996, 4,749,508 Class A shares, or 10.3% of the Fund's
capital stock and 16.7% of the Fund's Class A capital stock then outstanding,
and 7,995,335 Class D shares, or 17.4% of the Fund's capital stock and 45.6% of
the Fund's Class D capital stock then outstanding, were registered in the name
of Merrill Lynch Pierce Fenner & Smith, P.O.
Box 45286, Jacksonville, FL 32232-5286

MANAGEMENT AND EXPENSES

Under the Management Agreement, dated December 29, 1988, as amended January
1, 1996, subject to the control of the Board of Directors, J. & W. Seligman &
Co. Incorporated (the "Manager") manages the investment of the assets of the
Fund, including making purchases and sales of portfolio securities consistent
with the Fund's investment objectives and policies, and administers its business
and other affairs. The Manager provides the Fund with such office space,
administrative and other services and executive and other personnel as are
necessary for Fund operations. The Manager pays all of the compensation of
directors of the Fund who are employees or consultants of the Manager and of the
officers and employees of the Fund. The Manager also provides senior management
for Seligman Data Corp., the Fund's shareholder service agent.

The Fund pays the Manager a management fee for its services, calculated daily
and payable monthly. Effective January 1, 1996, the management fee is equal to
.95% per annum of the Fund's average daily net assets on the first $750 million
of net assets and .85% per annum of the Fund's average daily net assets in
excess of $750 million. For the fiscal years ended September 30, 1993, 1994 and
1995, the Fund paid .75% per annum of its average daily net assets or $259,663,
$390,476 and $1,260,769, respectively.

The Fund pays all its expenses other than those assumed by the Manager and
Seligman Henderson Co. (the "Subadviser"), including brokerage commissions,
administration, shareholder services and distribution fees, fees and expenses of
independent attorneys and auditors, taxes and governmental fees, including fees
and expenses of qualifying the Fund and its shares under Federal and State
securities laws, cost of stock certificates and expenses of repurchase or
redemption of shares, expenses of printing and distributing reports, notices and
proxy materials to shareholders, expenses of printing and filing reports and
other documents with governmental agencies, expenses of shareholders' meetings,
expenses of corporate data processing and related services, shareholder record
keeping and shareholder account services, fees and disbursements of transfer
agents and custodians, expenses of disbursing dividends and distributions, fees
and expenses of directors of the Fund not employed by or serving as a Director
of the Manager or its affiliates, insurance premiums and extraordinary expenses
such as litigation expenses. The Fund may be subject to certain state expense
limitations, the most stringent of which currently requires reimbursement of
total expenses (including the management fee, but excluding interest, taxes,
brokerage commissions, distribution fees and extraordinary expenses) in any year
that they exceed 2 1/2% of the first $30 million of average net assets, 2% of
the next $70 million of average net assets and 1 1/2% thereafter.

8
<PAGE>

The Management Agreement was initially approved by the Board of Directors at
a Meeting held on October 11, 1988 and by the shareholders at a meeting held on
December 15, 1988. The amendments to the Management Agreement, to increase the
fee rate payable to the Manager by the Fund, were approved by the Board of
Directors on September 21, 1995 and by the shareholders at a special meeting
held on December 12, 1995. The Management Agreement will continue in effect
until December 31 of each year if (1) such continuance is approved in the manner
required by the 1940 Act (i.e. by a vote of a majority of the Board of Directors
or of the outstanding voting securities of the Fund and by a vote of a majority
of the Directors who are not parties to the Management Agreement or interested
persons of any such party) and (2) if the Manager shall not have notified the
Fund at least 60 days prior to December 31 of any year that it does not desire
such continuance. The Management Agreement may be terminated by the Fund or by
the Manager, without penalty, on 60 days' written notice to the Manager and will
terminate automatically in the event of its assignment. The Fund has agreed to
change its name upon termination of the Management Agreement if continued use of
the name would cause confusion in the context of the Manager's business. The
Management Agreement provides that the Manager will not be liable to the Fund
for any error of judgment or mistake of law, or for any loss arising out of any
investment, or for any act or omission in performing its duties under the
Agreement, except for willful misfeasance, bad faith, gross negligence, or
reckless disregard of its obligations and duties under the Agreement.

The Manager is a successor firm to an investment banking business founded in
1864 which has thereafter provided investment services to individuals, families,
institutions and corporations. On December 29, 1988, a majority of the
outstanding voting securities of the Manager was purchased by Mr. William C.
Morris and a simultaneous recapitalization of the Manager occurred. See Appendix
for further history of the Manager.

Under the Subadvisory Agreement, dated June 1, 1994, as amended January 1,
1996, the Subadviser supervises and directs a portion of the Fund's investment
in foreign securities and Depositary Receipts, as designated by the Manager,
consistent with the Fund's investment objectives, policies and principles. For
these services, the Subadviser is paid a fee by the Manager, as described in the
Fund's Prospectus. The Subadvisory Agreement was initially approved by the Board
of Directors at a meeting held on January 20, 1994 and by the shareholders on
May 19, 1994. The amendments to the Subadvisory Agreement, effective January 1,
1996, to increase the subadvisory fee rate payable by the Manager to the
Subadviser, were approved by the Board of Directors on September 21, 1995 and by
the shareholders at a special meeting held on December 12, 1995. The Subadvisory
Agreement will continue in effect until December 31 of each year (1) if such
continuance is approved in the manner required by the 1940 Act (by a vote of a
majority of the Board of Directors or of the outstanding voting securities of
the Fund and by a vote of a majority of the Directors who are not parties to the
Subadvisory Agreement or interested persons of any such party) and (2) if the
Subadviser shall not have notified the Manager in writing at least 60 days prior
to December 31 of any year that it does not desire such continuance. The
Subadvisory Agreement may be terminated at any time by the Fund, on 60 days
written notice to the Subadviser. The Subadvisory Agreement will terminate
automatically in the event of its assignment or upon the termination of the
Management Agreement.

The Subadviser is a New York general partnership formed by the Manager and
Henderson International, Inc., a controlled affiliate of Henderson
Administration Group plc. Henderson Administration Group plc, headquartered in
London, is one of the largest independent money managers in Europe. The firm
currently manages approximately $19 billion in assets and is recognized as a
specialist in global equity investing.

For the period June 1, 1994 through September 30, 1994 and for the fiscal
year ended September 30, 1995, the Fund did not require the services of the
Subadviser.

Officers, directors and employees of the Manager are permitted to engage in
personal securities transactions, subject to the Manager's Code of Ethics (the
"Ethics Code"). The Ethics Code proscribes certain practices with regard to
personal securities transactions and personal dealings, provides a framework for
the reporting and monitoring of personal securities transactions by the
Manager's Director of Compliance, and sets forth a procedure of identifying, for
disciplinary action, those individuals who violate the Ethics Code. The Ethics
Code prohibits each of the officers, directors and employees (including all
portfolio managers) of the Manager from purchasing or selling any security that
the officer, director or employee knows or believes (i) was recommended by the
Manager for purchase or sale by any client, including the Fund, within the
preceding two weeks, (ii) has been reviewed by the Manager for possible purchase
or sale within the preceding two weeks, (iii) is being purchased or sold by any
client, (iv) is being considered by a research analyst, (v) is being acquired in
a private placement, unless prior approval has been obtained from the Manager's
Director of Compliance, or (vi) is being acquired during an initial or secondary
public offering. The Ethics Code also imposes a strict standard of
confidentiality and requires portfolio managers to disclose any interest they
may have in the securities or issuers that they recommend for purchase by any
client.

9
<PAGE>

The Ethics Code also prohibits (i) each portfolio manager or member of an
investment team from purchasing or selling any security within seven calendar
days of the purchase or sale of the security by a client's account (including
investment company accounts) for which the portfolio manager or investment team
manages and (ii) each employee from engaging in short-term trading (a purchase
and sale or vice-versa within 60 days). Any profit realized pursuant to either
of these prohibitions must be disgorged.

Officers, directors and employees are required, except under very limited
circumstances, to engage in personal securities transactions through the
Manager's order desk. The order desk maintains a list of securities that may not
be purchased due to a possible conflict with clients. All officers, directors
and employees are also required to disclose all securities beneficially owned by
them on December 31 of each year.

ADMINISTRATION, SHAREHOLDER SERVICES AND DISTRIBUTION PLAN

The Fund has adopted an Administration, Shareholder Services and Distribution
Plan for each Class (the "Plan") in accordance with Section 12(b) of the 1940
Act and Rule 12b-1 thereunder.

The Plan was approved on March 19, 1992 by the Directors, including a
majority of the Directors who are not "interested persons" (as defined in the
1940 Act) of the Fund and who have no direct or indirect financial interest in
the operation of the Plan or in any agreement related to the Plan (the
"Qualified Directors") and was approved by shareholders of the Fund at a Special
Meeting of the Shareholders held on May 1, 1992. The Plan became effective in
respect of the Class A shares on June 1, 1992. The Plan was approved in respect
of the Class B shares on March 21, 1996 by the Board of Directors of the Fund
including a majority of the Qualified Directors, and became effective in respect
of the Class B shares on April 22, 1996. The Plan was approved in respect of the
Class D shares on March 18, 1993 by the Directors, including a majority of the
Qualified Directors, and became effective in respect of the Class D shares on
May 1, 1993. The Plan will continue in effect until December 31 of each year so
long as such continuance is approved annually by a majority vote of both the
Directors of the Fund and the Qualified Directors, cast in person at a meeting
called for the purpose of voting on such approval. The Plan may not be amended
to increase materially the amounts payable to Service Organizations with respect
to a Class without the approval of a majority of the outstanding voting
securities of the class. If the amount payable in respect of Class A shares
under the Plan is proposed to be increased materially, the Fund will either (i)
permit holders of Class B shares to vote as a separate class on the proposed
increase or (ii) establish a new class of shares subject to the same payment
under the Plan as existing Class A shares, in which case the Class B shares will
thereafter convert into the new class instead of into Class A shares. No
material amendment to the Plan may be made except by a majority of both the
Directors and the Qualified Directors.

The Plan requires that the Treasurer of the Fund shall provide to the
Directors, and the Directors shall review, at least quarterly, a written report
of the amounts expended (and purposes therefor) under the Plan. Rule 12b-1 also
requires that the selection and nomination of Directors who are not "interested
persons" of the Fund be made by such disinterested Directors.

10
<PAGE>

PORTFOLIO TRANSACTIONS

The Management and Subadvisory Agreements recognize that in the purchase and
sale of portfolio securities of the Fund, the Manager and Subadviser will seek
the most favorable price and execution, and, consistent with that policy, may
give consideration to the research, statistical and other services furnished by
brokers or dealers to the Manager and Subadviser for its use, as well as the
general attitude toward and support of investment companies demonstrated by such
brokers or dealers. Such services include supplemental investment research,
analysis and reports concerning issuers, industries and securities deemed by the
Manager and Subadviser to be beneficial to the Fund. In addition, the Manager
and Subadviser is authorized to place orders with brokers who provide
supplemental investment and market research and security and economic analysis
although the use of such brokers may result in a higher brokerage charge to the
Fund than the use of brokers selected solely on the basis of seeking the most
favorable price and execution and although such research and analysis may be
useful to the Manager and Subadviser in connection with its services to clients
other than the Fund.

In over-the-counter markets, the Fund deals with responsible primary market
makers unless a more favorable execution or price is believed to be obtainable.
The Fund may buy securities from or sell securities to dealers acting as
principal, except dealers with which its directors and/or officers are
affiliated.

When two or more of the investment companies in the Seligman Group or other
investment advisory clients of the Manager desire to buy or sell the same
security at the same time, the securities purchased or sold are allocated by the
Manager in a manner believed to be equitable to each. There may be possible
advantages or disadvantages of such transactions with respect to price or the
size of positions readily obtainable or saleable.

The total brokerage commissions paid to others for execution and research
and statistical services for the fiscal years ended September 30, 1995, 1994 and
1993, respectively were $ 337,655, $86,871 and $54,608, of which Seligman
Securities, Inc. received $13,878 in 1993. Seligman Securities, Inc. ceased
functioning as a broker for the Fund and its other clients on March 31, 1993.

PURCHASE AND REDEMPTION OF FUND SHARES

The Fund issues three classes of shares: Class A shares may be purchased at
a price equal to the next determined net asset value per share, plus a sales
load. Class B shares may be purchased at a price equal to the next determined
net asset value without an initial sales load, but a CDSL may be charged on
redemptions within six years of purchase. Class D shares may be purchased at a
price equal to the next determined net asset value without an initial sales
load, but CDSL may be charged on redemptions within one year of purchase. See
"Alternative Distribution System," "Purchase of Shares," and "Redemption of
Shares" in the Prospectus.

Specimen Price Make-Up

Under the current distribution arrangements between the Fund and the
Distributor, Class A shares are sold at a maximum sales load of 4.75% and Class
D shares are sold at net asset value*. Using the Fund's net asset value at
September 30, 1995, the maximum offering price of the Fund's shares is as
follows:

Class A

Net asset value and redemption price per Class A share................. $ 14.04
------

Maximum sales load (4.75% of offering price)........................... $ .70
-----

Offering price to public............................................... $14.74
=====

11
<PAGE>

Class B and Class D

Net asset value and offering price per share *......................... $13.66
=====
- --------------
* Class B shares are subject to a CDSL declining from 5% in the first year
after purchase to 0% after six years. Class D shares are subject to a CDSL
of 1% on redemptions within one year of purchase. See "Redemption Of
Shares" in the Fund's Prospectus.

Class A Shares - Reduced End Sales Loads

Reductions Available. Shares of any Seligman Mutual Fund sold with a front-end
sales load in a continuous offering will be eligible for the following
reductions:

Volume Discounts are provided if the total amount being invested in Class A
shares of the Fund alone, or in any combination of shares of the other mutual
funds in the Seligman Group which are sold with a front-end sales load, reaches
levels indicated in the sales load schedule set forth in the Prospectus.

The Right of Accumulation allows an investor to combine the amount being
invested in Class A shares of the Fund and shares of the other mutual funds in
the Seligman Group that were sold with a front-end sales load with the total net
asset value of shares of those Seligman Mutual Funds already owned that were
sold with a front-end sales load and the total net asset value of shares of
Seligman Cash Management Fund which were acquired through an exchange of shares
of another mutual fund in the Seligman Group on which there was a front-end
sales load at the time of purchase to determine reduced sales loads in
accordance with the schedule in the Prospectus. The value of the shares owned,
including the value of shares of Seligman Cash Management Fund acquired in an
exchange of shares of another mutual fund in the Seligman Group on which there
was a front-end sales load at the time of purchase will be taken into account in
orders placed through a dealer, however, only if Seligman Financial Services,
Inc. ("SFSI") is notified by an investor or a dealer of the amount owned by the
investor at the time the purchase is made and is furnished sufficient
information to permit confirmation.

A Letter of Intent allows an investor to purchase Class A shares over a
13-month period at reduced sales loads in accordance with the schedule in the
Prospectus, based on the total amount of Class A shares of the Fund that the
letter states the investor intends to purchase plus the total net asset value of
shares that were sold with a front-end sales load of the other Mutual Funds in
the Seligman Group already owned and the total net asset value of shares of
Seligman Cash Management Fund which were acquired through an exchange of shares
of another Mutual Fund in the Seligman Group on which there was a front-end
sales load at the time of purchase. Reduced sales loads also may apply to
purchases made within a 13-month period starting up to 90 days before the date
of execution of a letter of intent. For more information concerning the terms of
the letter of intent see "Terms and Conditions - Letter of Intent - Class A
Shares Only" in the back of the Prospectus.

Persons Entitled To Reductions. Reductions in sales loads apply to purchases of
Class A shares by a "single person," including an individual; members of a
family unit comprising husband, wife and minor children; or a trustee or other
fiduciary purchasing for a single fiduciary account. Employee benefit plans
qualified under Section 401 of the Internal Revenue Code, of 1986, as amended,
organizations tax exempt under Section 501 (c)(3) or (13), and non-qualified
employee benefit plans that satisfy uniform criteria are considered "single
persons" for this purpose.
The uniform criteria are as follows:

1. Employees must authorize the employer, if requested by the Fund, to
receive in bulk and to distribute to each participant on a timely basis the Fund
Prospectus, reports and other shareholder communications.

2. Employees participating in a plan will be expected to make regular
periodic investments (at least annually). A participant who fails to make such
investments may be dropped from the plan by the employer or the Fund 12 months
and 30 days after the last regular investment in his account. In such event, the
dropped participant would lose the discount on share purchases to which the plan
might then be entitled.

12
<PAGE>

3. The employer must solicit its employees for participation in such an
employee benefit plan or authorize and assist an investment dealer in making
enrollment solicitations.

Eligible Employee Benefit Plans. The table of sales loads in the Prospectus
applies to sales to "eligible employee benefit plans" (as defined in the
Prospectus), except that the Fund may sell shares at net asset value to
"eligible employee benefit plans," which have at least $1 million invested in
the Seligman Group of Mutual Funds or (ii) of employers who have at least 50
eligible employees to whom such plan is made available or, regardless of the
number of employees, if such plan is established or maintained by any dealer
which has a sales agreement with SFSI. Such sales must be made in connection
with a payroll deduction system of plan funding or other systems acceptable to
Seligman Data Corp, the Fund's shareholder service agent. Such sales are
believed to require limited sales effort and sales-related expenses and
therefore are made at net asset value. Contributions or account information for
plan participation also should be transmitted to Seligman Data Corp. by methods
which it accepts. Additional information about "eligible employee benefit plans"
is available from investment dealers or SFSI.

Payment in Securities. In addition to cash, the Fund may accept securities in
payment for Fund shares sold at the applicable public offering price (net asset
value and, if applicable, any sales load), although the Fund does not presently
intend to accept securities in payment for Fund shares. Generally, the Fund will
only consider accepting securities (l) to increase its holdings in a portfolio
security, or (2) if the Manager determines that the offered securities are a
suitable investment for the Fund and in a sufficient amount for efficient
management. Although no minimum has been established, it is expected that the
Fund would not accept securities with a value of less than $100,000 per issue in
payment for shares. The Fund may reject in whole or in part offers to pay for
Fund shares with securities, may require partial payment in cash for applicable
sales loads, and may discontinue accepting securities as payment for Fund shares
at any time without notice. The Fund will not accept restricted securities in
payment for shares. The Fund will value accepted securities in the manner
provided for valuing portfolio securities of the Fund. (See "Valuation"). In
accordance with Texas securities regulations, should the Fund accept securities
in payment for shares, such transactions would be limited to a bona fide
reorganization, statutory merger, or to other acquisitions of portfolio
securities (except for municipal debt securities issued by state political
subdivisions or their agencies or instrumentalities) which meet the investment
objectives and policies of the investment company; are acquired for investment
and not for resale; are liquid securities which are not restricted as to
transfer either by law or liquidity of market; and have a value which is readily
ascertainable (and not established only by evaluation procedures) as evidenced
by a listing on the American Stock Exchange, the New York Stock Exchange
("NYSE") or NASDAQ.

Further Types of Reductions. Class A shares may be issued without a sales load
in connection with the acquisition of cash and securities owned by other
investment companies and other personal holding companies to financial
institution trust departments, to registered investment advisers exercising
investment discretionary authority with respect to the purchase of Fund shares,
or pursuant to sponsored arrangements with organizations which make
recommendations to, or permit group solicitation of, its employees, members or
participants in connection with the purchase of shares of the Fund, to separate
accounts established and maintained by an insurance company which are exempt
from registration under Section 3(c)(11) of the 1940 Act, to registered
representatives and employees (and their spouses and minor children) of any
dealer that has a sales agreement with SFSI and shareholders of mutual funds
with investment objectives similar to the Fund's who purchase shares with
redemption proceeds of such funds and to certain unit investment trusts as
described in the Prospectus.

Class A shares may be issued without a sales load to present and retired
directors, trustees, officers, employees (and their family members, as defined
in the Prospectus) of the Funds, the other investment companies in the Seligman
Group, the Manager and other companies affiliated with the Manager. Such sales
may also be made to employee benefit plans and thrift plans for such persons and
to any investment advisory, custodial, trust or other fiduciary account managed
or advised by the Manager or any affiliate. The sales may be made for investment
purposes only, and shares may be resold only to the Fund.

Class A shares may be sold at net asset value to these persons since such
sales require less sales effort and lower sales related expenses as compared
with sales to the general public.

13
<PAGE>

More About Redemptions. The procedures for redemption of Fund shares under
ordinary circumstances are set forth in the Prospectus. In unusual
circumstances, payment may be postponed, or the right of redemption postponed
for more than seven days, if the orderly liquidation of portfolio securities is
prevented by the closing of, or restricted trading on the NYSE during periods of
emergency, or such other periods as ordered by the Securities and Exchange
Commission. Under these circumstances, redemption proceeds may be made in
securities, subject to the review of some state securities commissions. If
payment is made in securities, a shareholder may incur brokerage expenses in
converting these securities to cash.

DISTRIBUTION SERVICES

SFSI, an affiliate of the Manager, acts as general distributor of the
shares of the Fund and of the other Mutual Funds in the Seligman Group. The Fund
and SFSI are parties to a Distributing Agreement dated January 1, 1993. As
general distributor of the Fund's Capital Stock, SFSI allows commissions on
sales of Fund shares to all dealers of up to 4.25% on purchases of Class A
Shares to which the 4.75% sales load applies. Total sales loads paid by
shareholders of Class A shares of the Fund for the fiscal years ended September
30, 1993, 1994 and 1995, respectively, amounted to $96,613, $254,283 and
$5,489,668, respectively, of which $86,097, $225,716 and $4,882,246,
respectively, was paid as commissions to dealers. No Class B shares were
outstanding throughout the 3 year period ended September 30, 1995. SFSI receives
the balance of sales loads and any CDSLs paid by investors. For the period May
1, 1993 through September 30, 1993, SFSI retained CDSL charges amounting to $50.
For the fiscal years ended September 30, 1994 and 1995, SFSI retained CDSL
charges amounting to $1,240 and $22,116, respectively.

Effective April 1, 1995, Seligman Services, Inc. ("SSI"), an affiliate of
the Manager, became eligible to receive commissions from certain sales of Fund
shares, as well as distribution and service fees pursuant to the Plan. For the
period ended September 30, 1995, SSI received commissions of $104,682 from sales
of Fund shares. SSI also received distribution and service fees of $11,821,
pursuant to the Plan.

VALUATION

Net asset value per share of each class of the Fund is determined as of the
close of the NYSE (normally, 4:00 p.m. New York City time), on each day that the
NYSE is open for business. The NYSE is currently closed on New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. The Fund will also determine net asset value
for each class on each day in which there is a sufficient degree of trading in
the Fund's portfolio securities that the net asset value of Fund shares might be
materially affected. Net asset value per share for a class is computed by
dividing such class' share of the value of the net assets of the Fund (i.e., the
value of its assets less liabilities) by the total number of outstanding shares
of such class. All expenses of the Fund, including the Manager's fee, are
accrued daily and taken into account for the purpose of determining net asset
value. The net asset value of Class B and Class D shares will generally be lower
than the net asset value of Class A shares as a result of the higher
distribution fee with respect to such shares.

Portfolio securities, including open short positions and options written,
are valued at the last sale price on the securities exchange or securities
market on which such securities primarily are traded. Securities not listed on
an exchange or securities market, or securities in which there were no
transactions, are valued at the average of the most recent bid and asked price,
except in the case of open short positions where the asked price is available.
Any securities or other assets for which recent market quotations are not
readily available are valued at fair value as determined in accordance with
procedures approved by the Board of Directors. Short-term obligations with less
than sixty days remaining to maturity are generally valued at amortized cost.
Short-term obligations with more than sixty days remaining to maturity will be
valued at current market value until the sixtieth day prior to maturity, and
will then be valued on an amortized cost basis based on the value on such date
unless the Board determines that this amortized cost value does not represent
fair market value. Expenses and fees, including the investment management fee,
are accrued daily and taken into account for the purpose of determining the net
asset value of Fund shares.

14
<PAGE>

Generally, trading in foreign securities, as well as U.S. Government
securities, money market instruments and repurchase agreements, is substantially
completed each day at various times prior to the close of the NYSE. The values
of such securities used in computing the net asset value of the shares of the
Fund are determined as of such times. Foreign currency exchange rates are also
generally determined prior to the close of the NYSE. Occasionally, events
affecting the value of such securities and such exchange rates may occur between
the times at which they are determined and the close of the NYSE, which will not
be reflected in the computation of net asset value. If during such periods
events occur which materially affect the value of such securities, the
securities will be valued at their fair market value as determined in accordance
with procedures approved by the Board of Directors.

For purposes of determining the net asset value per share of the Fund, all
assets and liabilities initially expressed in foreign currencies will be
converted into U.S. dollars at the mean between the bid and offer prices of such
currencies against U.S. dollars quoted by a major bank that is a regular
participant in the foreign exchange market or on the basis of a pricing service
that takes into account the quotes provided by a number of such major banks.

PERFORMANCE

The average annual total returns for the Fund's Class A shares for the
one-year, five-year, and ten-year periods through September 30, 1995 were
30.29%, 28.23%, and 17.71%, respectively. These returns were computed by
subtracting the maximum sales load of 4.75% of public offering price and
assuming that all of the dividends and distributions paid by the Fund over the
relevant time period were reinvested. It was then assumed that at the end of
each period, the entire amount was redeemed. The average annual total return was
then calculated by calculating the annual rate required for the initial payment
to grow to the amount which would have been received upon such redemption (i.e.,
the average annual compound rate of return). The average annual total returns
for the Fund's Class D shares for the one-year period ended September 30, 1995
and since inception through September 30, 1995 were 34.53% and 29.14%,
respectively. These returns were computed assuming that all of the dividends and
distributions paid by the Fund's Class D shares, if any, were reinvested over
the relevant time period. It was then assumed that at the end of each period,
the entire amount was redeemed, subtracting the 1% CDSL, if applicable.
Performance information is not provided for Class B shares because no Class B
shares were outstanding prior to April 22, 1996.

Table A below illustrates the total return (income and capital) on Class A
shares of the Fund with dividends invested and gain distributions taken in
shares. It shows that a $1,000 investment in Class A shares, assuming payment of
the 4.75% sales load, made on October 1, 1985 had a value of $5,105 on September
30, 1995 resulting in an aggregate total return of 410.48%. Table B illustrates
the total return (income and capital) on Class D shares of the Fund with
dividends invested and gain distributions taken in shares. It shows that a
$1,000 investment in Class D shares made on May 1, 1993 (commencement of
operations of Class D shares) had a value of $1,852 on September 30, 1995
resulting in an aggregate total return of 85.24%. The results shown should not
be considered a representation of the dividend income or gain or loss in capital
value which may be realized from an investment made in a class of shares of the
Fund today.

<TABLE>
<CAPTION>
TABLE A - CLASS A SHARES

Value of
Value of Capital Value Total Value
Year Initial Gain of of Total
Ended Investment 2 Distributions Dividends Investment2 Return1,3
- ----- ------------ ------------- --------- ----------- ---------
<S> <C> <C> <C> <C> <C>
9/30/86 $ 1,124 $ - $ 2 $ 1,226
9/30/87 1,510 61 2 1,573
9/30/88 1,115 264 1 1,380
9/30/89 1,452 344 2 1,798
9/30/90 1,133 268 1 1,402
9/30/91 1,730 416 4 2,150
9/30/92 1,622 630 4 2,256
9/30/93 2,073 1,321 5 3,399
9/30/94 1,878 1,850 4 3,732
9/30/95 2,269 2,831 5 5,105 410.48%

</TABLE>

15
<PAGE>

<TABLE>
<CAPTION>
TABLE B - CLASS D SHARES

Value of
Value of Capital Value Total Value
Year/Period Initial Gain of of Total
Ended 1 Investment 2 Distributions Dividends Investment2 Return3
- ----------- ------------ ------------- --------- ----------- -------

1 For the ten-year period ended September 30, 1995 for Class A shares; and
from commencement of operations of Class D shares on May 3, 1993.
2 The "Value of Initial Investment" as of the date indicated reflects the
effect of the maximum sales load, assumes that all dividends and capital
gain distributions were taken in cash and reflects changes in the net asset
value of the shares purchased with the hypothetical initial investment.
"Total Value of Investment" reflects the effect of the CDSL, if applicable,
assumes investment of all dividends and capital gain distributions and
reflects changes in the net asset value.
3 Total return for each Class of shares of the Fund is calculated by assuming
a hypothetical initial investment of $1,000 at the beginning of the period
specified; subtracting the maximum sales load for Class A shares;
determining total value of all dividends and distributions that would have
been paid during the period on such shares assuming that each dividend or
distribution was invested in additional shares at net asset value;
calculating the total value of the investment at the end of the period;
subtracting the CDSL on Class D shares, if applicable; and finally, by
dividing the difference between the amount of the hypothetical initial
investment at the beginning of the period and its total value at the end of
the period by the amount of the hypothetical initial investment.

The Fund's total return and average annual total return of Class A shares
quoted from time to time through June 1, 1992 does not reflect the deduction of
the administration, shareholder services and distribution fee, and through
December 31, 1995 for Class A and Class D shares does not reflect the increased
management fee approved by shareholders on December 12, 1995 and effective on
January 1, 1996; which fees if reflected would reduce the performance quoted.

The Fund may also include its aggregate total return over a specified period
in advertisements or in information furnished to present or prospective
shareholders.

GENERAL INFORMATION

Capital Stock. The Board of Directors is authorized to classify or reclassify
and issue any unissued Capital Stock of the Fund into any number of other
classes without further action by shareholders. The 1940 Act requires that where
more than one class exists, each class must be preferred over all other classes
in respect of assets specifically allocated to such class.

Custodian. Investors Fiduciary Trust Company, 127 West 10th Street, Kansas City,
Missouri 64105 serves as custodian of the Fund. It also maintains, under the
general supervision of the Manager, the accounting records and determines the
net asset value for the Fund.

Auditors. Deloitte & Touche LLP, independent auditors, have been selected as
auditors of the Fund. Their address is Two World Financial Center, New York, New
York 10281.

FINANCIAL STATEMENTS

The Annual Report to shareholders for the fiscal year ended September 30,
1995 is incorporated by reference into this Statement of Additional Information.
The Annual Report contains a schedule of the investments of the Fund as of
September 30, 1995, as well as certain other financial information as of that
date. The Annual Report will be furnished without charge to investors who
request copies of the Fund's Statement of Additional Information.

16
<PAGE>

APPENDIX

HISTORY OF J. & W. SELIGMAN & CO. INCORPORATED

Seligman's beginnings date back to 1837, when Joseph Seligman, the
oldest of eight brothers, arrived in the United States from Germany. He earned
his living as a pack peddler in Pennsylvania, and began sending for his
brothers. The Seligmans became successful merchants, establishing businesses in
the South and East.

Backed by nearly thirty years of business success - culminating in the
sale of government securities to help finance the Civil War - Joseph Seligman,
with his brothers, established the international banking and investment firm of
J. & W. Seligman & Co. In the years that followed, the Seligman Complex played a
major role in the geographical expansion and industrial development of the
United States.

The Seligman Complex:

...Prior to 1900

o Helps finance America's fledgling railroads through underwritings.
o Is admitted to the New York Stock Exchange in 1869. Seligman remained a
member of the NYSE until 1993, when the evolution of its business made it
unnecessary.
o Becomes a prominent underwriter of corporate securities, including New York
Mutual Gas Light Company, later part of Consolidated Edison.
o Provides financial assistance to Mary Todd Lincoln and urges the Senate to
award her a pension.
o Is appointed U.S. Navy fiscal agent by President Grant.
o Becomes a leader in raising capital for America's industrial and urban
development.

...1900-1910

o Helps Congress finance the building of the Panama Canal.

...1910s

o Participates in raising billions for Great Britain, France and Italy,
helping to finance World War I.

...1920s

o Participates in hundreds of successful underwritings including those for
some of the Country's largest companies: Briggs Manufacturing, Dodge
Brothers, General Motors, Minneapolis-Honeywell Regulatory Company, Maytag
Company United Artists Theater Circuit and Victor Talking Machine Company.
o Forms Tri-Continental Corporation in 1929, today the nation's largest,
diversified closed-end equity investment company, with over $2 billion in
assets, and one of its oldest.

17
<PAGE>

...1930s

o Assumes management of Broad Street Investing Co. Inc., its first mutual
fund, today known as Seligman Common Stock Fund, Inc.
o Establishes Investment Advisory Service.

...1940s

o Helps shape the Investment Company Act of 1940.
o Leads in the purchase and subsequent sale to the public of Newport News
Shipbuilding and Dry Dock Company, a prototype transaction for the
investment banking industry.
o Assumes management of National Investors Corporation, today Seligman Growth
Fund, Inc.
o Establishes Whitehall Fund, Inc., today Seligman Income Fund, Inc.

...1950-1989

o Develops new open-end investment companies. Today, manages more than 40
mutual fund portfolios.
o Helps pioneer state-specific, tax-exempt municipal bond funds, today
managing a national and 18 state-specific tax-exempt funds.
o Establishes J. & W. Seligman Trust Company and J. & W. Seligman Valuations
Corporation.
o Establishes Seligman Portfolios, Inc., an investment vehicle offered
through variable annuity products.

...1990s

o Introduces Seligman Select Municipal Fund, Inc. and Seligman Quality
Municipal Fund, Inc. two closed-end funds that invest in high quality
municipal bonds.
o In 1991 establishes a joint venture with Henderson Administration Group
plc, of London, known as Seligman Henderson Co., to offer global investment
products.
o Introduces Seligman Frontier Fund, Inc., a small capitalization mutual
fund.
o Launches Seligman Henderson Global Fund Series, Inc., which today offers
four separate series: Seligman Henderson International Fund, Seligman
Henderson Global Smaller Companies Fund, Seligman Henderson Global
Technology Fund and Seligman Henderson Global Growth Opportunities Fund.