FREMONT MUTUAL FUNDS INC
DEF 14A, 1997-01-27
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Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No.   )

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

Check the appropriate box:

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

                          Fremont Mutual Funds, Inc.
- -----------------------------------------------------------------------------
               (Name of Registrant as Specified in Its Charter)

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

Payment of Filing Fee (Check the appropriate box):
[ ]      $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1),
                  14a-6(j)(2) or Item 22(a)(2) of Schedule 14A.
[ ]      $500 per each party to the controversy pursuant to
         Exchange Act Rule 14a-6(i)(3).
[ ]      Fee computed on table below per Exchange Act Rules
                  14a-6(i)(4) and 0-11.

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

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

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

              ------------------------------------------------------------
    4)        Proposed maximum aggregate value of transaction:

              ------------------------------------------------------------
    5)        Total fee paid:

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

[ ]      Fee paid previously with preliminary materials.


<PAGE>



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

         1) Amount previously paid:

         2) Form, Schedule or Registration Statement No.:

         3) Filing party:

         4) Date filed:


<PAGE>



FREMONT
FUNDS

Re: Proxy and Shareholders' Meeting

Dear Fremont Mutual Fund Shareholder:

PLEASE READ THIS LETTER...IMPORTANT DOCUMENTS ENCLOSED.

I am writing to inform you of an important Proxy vote involving all Fremont
shareholders. We encourage all shareholders to exercise their right to vote on
these significant issues concerning the Fremont Funds. The Fremont Board of
Directors has recommended that each of the proposals presented below be
approved by the Fremont Fund shareholders.

Enclosed is a proxy statement which will provide a detailed explanation of each
proposal. The matters on which you are asked to vote and approve are:

|X|  The amendment of each Fund's investment advisory agreement to permit 
     Fremont Investment Advisors, Inc. (the "Advisor") to hire or terminate 
     subadvisors or modify existing subadvisory agreements without a 
     shareholder vote. The Advisor is responsible to the shareholders for the 
     selection and oversight of portfolio managers and subadvisors for the 
     Fremont Funds. Currently, the Advisor may employ, terminate, or change 
     portfolio managers only with shareholder approval. Implementing the 
     proposed amendment could benefit shareholders by reducing Fund expenses 
     and improving operating efficiencies.

|X|  The election of David L. Redo, Michael H. Kosich, Vincent P. Kuhn, Jr., 
     Richard E. Holmes, William W. Jahnke, Donald C. Luchessa and David L. Egan
     as Directors of Fremont Mutual Funds.

In this packet you will find two items:

|X|  The proxy statement. This explains more about the proposals outlined
     above, and provides the background and purpose of each proposal.

|X|  The proxy card--to use as a ballot.

HOW TO VOTE ON THESE PROPOSALS

If you would like to cast your vote in person you may do so at the special
shareholders' meeting that will take place at 9:00 a.m. on Friday, February
28, 1997, in the main conference room on the 26th floor of 333 Market Street,
in San Francisco.

If you do NOT plan to attend the special meeting of Fremont Fund shareholders,
it is very important that you exercise your voting rights by completing and
returning your proxy card in the enclosed postage-paid envelope NO LATER THAN
FEBRUARY 26, 1997. Your prompt response will avoid the cost of additional
mailings to you as a shareholder.

THE BOARD OF DIRECTORS OF FREMONT MUTUAL FUNDS, INC. UNANIMOUSLY RECOMMENDS 
THAT YOU VOTE IN FAVOR OF EACH OF THE PROPOSALS OUTLINED ABOVE.

If you have any questions about any of these materials, please call us at
800-548-4539 (PRESS 1).

Sincerely,

/s/ David L. Redo

David L. Redo
Chairman

               Fremont Mutual Funds, Inc., Shareholder Services
          312 Walnut Street, 21st Floor, Cincinnati, Ohio 45202-3874
  P.O. Box 5354. Cincinnati, Ohio 45201-5354 Telephone 800-548-4539 (press 2)

           Distributed by Funds Distributor, Inc., 50 Beale Street,
                      Suite 100, San Francisco, CA 94105


<PAGE>



                          FREMONT MUTUAL FUNDS, INC.
                       SPECIAL MEETING OF SHAREHOLDERS
                               FEBRUARY 28, 1997

                                     PROXY

          THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
                         OF FREMONT MUTUAL FUNDS, INC.

The undersigned hereby appoints David L. Redo and Vincent P. Kuhn, Jr., and
each of them, as Proxies with power of substitution and hereby authorizes each
of them to represent and to vote as provided on the reverse side, all shares
of beneficial interest of the above Corporation which the undersigned is
entitled to vote at the special meeting of shareholders to be held on February
28, 1997 or at any adjournment thereof.

The undersigned acknowledges receipt of the Notice of Special Meeting and Proxy
Statement dated January 20, 1997.

                                                 Date:________________________
                                                 
                                                 Note: Please sign exactly as 
                                                 your name appears on this 
                                                 proxy. If signing for an 
                                                 estate, trust or corporation, 
                                                 title or capacity should be 
                                                 stated. If shares are held 
                                                 jointly, both signers shall
                                                 sign, although the signature 
                                                 of one will bind the other.

                                                 _____________________________
                                                 Signature(s) PLEASE SIGN 
                                                 IN BOX ABOVE


<PAGE>



PLEASE VOTE BY FILLING IN THE APPROPRIATE BOX BELOW, AS SHOWN, USING
BLUE OR BLACK INK OR DARK PENCIL.  DO NOT USE RED INK.

1.       / / FOR / / AGAINST / / ABSTAIN With respect to the proposal to amend
         the Investment Advisory and Administrative Services Agreement with
         Fremont Investment Advisors, Inc. (the "Advisor") in order to permit
         the Advisor to hire and treminate subadvisors or modify subadvisory
         agreements without shareholder approval.

2.       / / FOR / / WITHOUT Authority to vote for the election of all
         nominees for director as listed below (except as marked to the
         contrary below).
         INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
         NOMINEE, WRITE THAT NOMINEE'S NAME ON THE LINE BELOW.
                D. Redo, V. Kuhn, M. Kosich, R. Holmes, W. Jahnke,
                D. Luchessa, D. Egan

3.       In their discretion, the Proxies are authorized to vote upon such
         other matters as may properly come before the meeting. IF NO
         DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR PROPOSAL 1 AND FOR
         THE ELECTION OF DIRECTORS.

PLEASE MARK YOUR PROXY, DATE AND SIGN IT ON THE REVERSE SIDE, AND RETURN
IT PROMPTLY IN THE ACCOMPANYING ENVELOPE WHICH REQUIRES NO POSTAGE IF
MAILED IN THE UNITED STATES.


<PAGE>



                          FREMONT MUTUAL FUNDS, INC.
                         333 Market Street, 26th Floor
                        San Francisco, California 94105
- -----------------------------------------------------------------------------
                   NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
     Fremont Money Market Fund, Fremont Global Fund, Fremont Growth Fund,
       Fremont Bond Fund, Fremont California Intermediate Tax-Free Fund
                       and Fremont Emerging Markets Fund

                        To Be Held on February 28, 1997

- -----------------------------------------------------------------------------
         NOTICE IS HEREBY GIVEN that a special meeting of shareholders of
Fremont Mutual Funds, Inc. will be held in the main conference room on the
26th floor of 333 Market Street, San Francisco, California 94105, on Friday,
February 28, 1997 at 9:00 a.m. to consider and vote on the following matters:

1.       To approve or disapprove a proposal to amend the Investment
         Advisory and Administrative Services Agreement with Fremont
         Investment Advisors, Inc. (the "Advisor") in order to permit the
         Advisor to hire and terminate subadvisors or modify subadvisory
         agreements without shareholder approval;

2.       To elect seven directors, each to serve for an indefinite term; and

3.       To transact any other business, not currently contemplated, that
         may properly come before the meeting in the discretion of the
         proxies or their substitutes.

         Shareholders of record at the close of business on January 13, 1997
are entitled to notice of and to vote at this meeting or any adjournment
thereof.

                                           By order of the Board of Directors,

                                           /s/ Tina Thomas
                                           Tina Thomas, Secretary

January 20, 1997

         Please execute the enclosed proxy and return it promptly in the
enclosed envelope, thus avoiding unnecessary expense and delay. No postage is
required if mailed in the United States. The proxy is revocable and will not
affect your right to vote in person if you attend the meeting.


<PAGE>



                          FREMONT MUTUAL FUNDS, INC.
                         333 MARKET STREET, 26TH FLOOR
                        SAN FRANCISCO, CALIFORNIA 94105

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

                        SPECIAL MEETING OF SHAREHOLDERS
        Fremont Money Market Fund, Fremont Global Fund, Fremont Growth
         Fund, Fremont Bond Fund, Fremont California Intermediate Tax-
                  Free Fund and Fremont Emerging Markets Fund

                        To Be Held on February 28, 1997

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

                                PROXY STATEMENT

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

         This Proxy Statement is furnished in connection with the solicitation
by the board of directors (the "Board of Directors" or "Board") of Fremont
Mutual Funds, Inc. (the "Company") of proxies for use at the special meeting
of shareholders or at any adjournment thereof. The Proxy Statement and form of
proxy were first mailed to shareholders on or about January 29, 1997.

         The Company is comprised of nine separate series. This Proxy
Statement is being furnished to the shareholders of the following six series:
Fremont Money Market Fund, Fremont Global Fund, Fremont Growth Fund, Fremont
Bond Fund, Fremont California Intermediate Tax-Free Fund and Fremont Emerging
Markets Fund (each individually referred to herein as a "Fund," and
collectively as the "Funds"). A separate proxy statement has been furnished to
the shareholders of the remaining three series of the Company.

         The primary purpose of the special meeting is to approve a proposal
to amend the Investment Advisory and Administrative Services Agreement between
the Company, on behalf of the Funds, and Fremont Investment Advisors, Inc.
(the "Advisor") in order to permit the Advisor to hire or terminate
subadvisors or modify subadvisory agreements without shareholder approval.
Shareholders are also being asked to elect seven directors to serve on the
Board.

         A proxy, if properly executed, duly returned and not revoked, will be
voted in accordance with the specifications therein. A proxy which is properly
executed that has no voting instructions to a proposal will be voted for that
proposal. A shareholder may revoke a proxy at any time prior to use by filing
with the Secretary of the Company an instrument revoking the proxy, by
submitting a proxy bearing a later date, or by attending and voting at the
meeting.

         The Company has retained Management Information Services
Corp. ("MIS") to solicit proxies for the special meeting.  MIS is
responsible for printing proxy cards, mailing proxy material to


<PAGE>



shareholders, soliciting brokers, custodians, nominees and fiduciaries,
tabulating the returned proxies and performing other proxy solicitation
services. The anticipated cost to the Funds of such services is approximately
$10,000, and will be paid by the Funds. The Funds will also pay the printing
and postage costs of soliciting Fund shareholders.

         In addition to solicitation through the mails, proxies may be
solicited by officers, employees and agents of the Company without additional
cost to the Funds. Such solicitation may be by telephone, facsimile or
otherwise. The Funds will reimburse MIS, brokers, custodians, nominees and
fiduciaries for the reasonable expenses incurred by them in connection with
forwarding solicitation material to the beneficial owners of shares held of
record by such persons.

         THE COMPANY'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED OCTOBER 31,
1996 IS AVAILABLE AT NO CHARGE BY WRITING TO THE COMPANY AT 50 BEALE STREET,
SUITE 100, SAN FRANCISCO, CALIFORNIA 94105, OR BY CALLING THE COMPANY
NATIONWIDE TOLL-FREE 800-548-4539 (PRESS 1).

I.       APPROVAL OR DISAPPROVAL OF A PROPOSAL TO AMEND THE ADVISORY
         AGREEMENT TO PERMIT THE ADVISOR TO HIRE AND TERMINATE
         SUBADVISORS OR MODIFY SUBADVISORY AGREEMENTS WITHOUT
         SHAREHOLDER APPROVAL

         The Advisor currently serves as investment advisor to the Funds
pursuant to an Investment Advisory and Administrative Services Agreement (the
"Advisory Agreement") with the Company. The Advisor currently employs
subadvisors with respect to three of the Funds and may engage additional
subadvisors with respect to each Fund in the future. The Company is proposing
to amend the Advisory Agreement to permit the Company and the Advisor to enter
into, terminate, or modify subadvisory agreements on behalf of any Fund with
subadvisors without obtaining the prior approval of a majority of the
outstanding voting securities of such Fund, as is otherwise required by
Section 15(a) of the Investment Company Act of 1940 (the "1940 Act").

         Section 15(a) of the 1940 Act and Rule 18f-2 thereunder require that
the shareholders of a Fund approve that Fund's subadvisory agreement(s) and
any amendments thereto. On December 16, 1996, the Company and the Advisor
received from the Securities and Exchange Commission an order (the "SEC
Order") exempting the Funds from these provisions. The SEC Order permits the
Advisor to hire new subadvisors, terminate subadvisors, rehire existing
subadvisors whose agreements have been assigned (and, thus, automatically
terminated), and modify subadvisory agreements without the prior approval of
shareholders. By eliminating shareholder approval in these matters, the
Advisor would have greater flexibility in managing subadvisors, and
shareholders would save the considerable expenses involved in holding
shareholder meetings and soliciting proxies. Pursuant to the SEC Order, the
Company and the Advisor have agreed to the imposition of the following
conditions:


<PAGE>



         (1) The Advisor will not enter into a subadvisory agreement with a
subadvisor that is an "affiliated person," as defined in the 1940 Act, of the
Company or the Advisor (an "Affiliated Manager"), other than by reason of
serving as a subadvisor to one or more of the Funds, without such agreement,
including the compensation to be paid thereunder, being approved by the
shareholders of the applicable Fund.

         (2) At all times, a majority of the Company's directors will be
persons each of whom is not an "interested person" of the Company as defined
in the 1940 Act ("Independent Directors"), and the nomination of new or
additional Independent Directors will be placed with the discretion of the
then existing Independent Directors.

         (3) When a subadvisor change is proposed for a Fund with an
Affiliated Manager, the Company's directors, including a majority of the
Independent Directors, will make a separate finding, reflected in the
Company's board minutes, that such change is in the best interests of the Fund
and its shareholders and does not involve a conflict of interest from which
the Advisor or the Affiliated Manager derives an inappropriate advantage.

         (4) The Advisor will provide general management services to the
Company and the Funds and, subject to review and approval by the Company's
Board of Directors, will (i) set the Funds' overall investment strategies;
(ii) select subadvisor(s); (iii) allocate and, when appropriate, reallocate a
Fund's assets among the Advisor and one or more subadvisors; (iv) monitor and
evaluate the performance of subadvisors; and (v) seek to ensure that the
subadvisors comply with the Funds' investment objectives, policies and
restrictions.

         (5) Within 60 days of the hiring of any new subadvisor or the
implementation of any proposed material change in a subadvisory agreement, the
Advisor will furnish shareholders all information about the new subadvisor or
subadvisory agreement that would be included in a proxy statement. Such
information will include the fees paid by the Advisor to the subadvisor and
any change in such disclosure caused by the addition of a new subadvisor or
any proposed material change in a subadvisory agreement. The Advisor will meet
this condition by providing shareholders with an information statement which
meets the requirements of the proxy rules under applicable federal securities
laws.

         (6) The Funds will disclose in their respective Prospectuses the
existence, substance and effect of the SEC Order.


<PAGE>



         (7) Before a Fund may rely on the SEC Order, the operations of the
Fund in the manner described therein will be approved by a majority of such
Fund's outstanding voting securities, as defined in the 1940 Act.

         (8) No director or officer of the Company or the Advisor will own
directly or indirectly (other than through a pooled investment vehicle that is
not controlled by any such director or officer) any interest in a subadvisor
except for (i) ownership of interests in the Advisor or any entity that
controls, is controlled by or is under common control with the Advisor; (ii)
ownership of less than 1% of the outstanding securities of any class of equity
or debt of a publicly-traded company that is either a subadvisor or an entity
that controls, is controlled by or is under common control with a subadvisor.

         In accordance with condition (7), shareholder approval of this
proposed new arrangement is being sought. Even if a Fund's shareholders
approve this arrangement, any new subadvisors engaged or terminated with
respect to such Fund or any change in a subadvisory agreement with respect to
such Fund will still require approval of the Board of Directors. In order to
approve new subadvisors, the Board will analyze the factors they deem
relevant, including the nature, quality and scope of services provided by
subadvisors to investment companies comparable to the Funds. The Board will
review the ability of the subadvisor to provide its services to the Funds, as
well as its personnel, operation, financial condition or any other factor
which would affect the provision of these services. The Board will examine the
performance of the subadvisor with respect to compliance and regulatory
matters over the past fiscal year. The Board will review the subadvisor's
investment performance with respect to accounts deemed comparable. Finally,
the Board will consider other factors deemed relevant to the subadvisor's
performance as an investment advisor. The Board believes that this review
provides adequate shareholder protection in the selection of subadvisors.

         On October 30, 1996, the Board of Directors of the Company, including
a majority of the Independent Directors, unanimously approved, subject to the
required shareholder approval described herein, proposed amendments to the
Advisory Agreement to specifically permit the Advisor to hire and terminate
subadvisors or modify subadvisory agreements without shareholder approval. If
this Proposal is approved by shareholders of each Fund, the Advisory Agreement
will be amended to include the following new paragraph:

         Subject to prior approval of the Board of Directors, the Advisor may,
         but is not required to, retain one or more investment management
         organizations


<PAGE>



         ("Subadvisors") to make specific investment decisions with respect to
         all or a portion of the assets of a particular Series. The Advisor
         may allocate portions of a Series' assets among such Subadvisor(s) or
         among itself and such Subadvisor(s). The Advisor shall monitor the
         performance of such Subadvisor(s), shall allocate and reallocate
         assets among Subadvisors of Series with multiple Subadvisors, and
         shall recommend the employment or termination of a particular
         Subadvisor when deemed advisable. The Advisor will compensate such
         Subadvisor(s) from its own resources, at no additional cost to the
         Company.

         Except for the foregoing change and certain other non-material
changes deemed appropriate by the Board of Directors in light of the SEC
Order, all other provisions in the Advisory Agreement will remain identical in
all material respects.

         The Advisory Agreement, as proposed to be amended, is included herein
as Exhibit A.

         THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE
PROPOSAL TO AMEND THE ADVISORY AGREEMENT. If the shareholders of any Fund do
not approve this Proposal, the Advisory Agreement currently in place will
continue with respect to such Fund and the terms and conditions of the SEC
Order will not be applicable to such Fund.

         THE ADVISORY AGREEMENT. The Advisor provides each Fund with
investment management and administrative services pursuant to the Advisory
Agreement. The Advisory Agreement provides that the Advisor shall furnish
advice to each Fund with respect to its investments and shall, to the extent
authorized by the Board of Directors, determine what securities shall be
purchased or sold by the Fund. As described more fully below, the Advisor
presently retains subadvisors to provide portfolio management services to the
Growth Fund, the Bond Fund and the Emerging Markets Fund. The Advisor oversees
the portfolio management of the Funds, including the services provided by the
subadvisors. The Advisor provides direct portfolio management services to the
extent that a subadvisor does not provide those services.

         The Advisory Agreement has never before been submitted for a vote to
public shareholders of the Company. The Advisory Agreement was last approved
by the Board of Directors, including a majority of the Independent Directors,
on January 25, 1996 with respect to the Money Market Fund and the Growth Fund,
and on June 18, 1996 with respect to the Global Fund, the Emerging Markets
Fund, the Bond Fund and the California Intermediate Tax-Free Fund.


<PAGE>



         The Advisory Agreement requires that brokerage orders for each Fund's
portfolio securities transactions are placed by the Advisor or a subadvisor,
as applicable. The Advisor and subadvisors seek to obtain the best available
prices in the Funds' portfolio transactions, taking into account the costs and
promptness of executions. Subject to this policy, transactions may be directed
to those broker-dealers who provide research, statistical and other
information to the Funds, the Advisor or the subadvisors who provide
assistance with respect to the distribution of Fund shares. Subject to the
requirements of the 1940 Act and procedures adopted by the Board of Directors,
the Funds may execute portfolio transactions through any broker or dealer and
pay brokerage commissions to a broker which is an affiliated person of the
Company, the Advisor or a subadvisor. During the fiscal year ended October 31,
1996, the Emerging Markets Fund paid brokerage commissions of $2,352 to Credit
Lyonnais Securities (USA), Inc. (which was 11.7% of the aggregate brokerage
commissions paid by the Fund during such period). Credit Lyonnais Securities
(USA), Inc. is an affiliated company of Credit Lyonnais International Asset
Management (HK) Limited, the subadvisor to the Fremont Emerging Markets Fund.

         The Advisory Agreement may be renewed annually, provided that any
such renewal has been specifically approved by (i) the Board of Directors, or
by the vote of a majority (as defined in the 1940 Act) of the outstanding
voting securities of a Fund, and (ii) the vote of a majority of the
Independent Directors, cast in person, at a meeting called for the purpose of
voting on such approval. The Advisory Agreement also provides that either
party thereto has the right with respect to any Fund to terminate it without
penalty upon sixty days' written notice to the other party, and that the
Advisory Agreement terminates automatically in the event of its assignment.

         For the services provided under the Advisory Agreement, the Advisor
receives a fee based on the average daily net assets of each Fund at the
following annual rates:

<TABLE>
<CAPTION>

                            ADVISORY FEE                ADMINISTRATIVE FEE
                        ----------------------         ---------------------
<S>                     <C>                           <C>
Global Fund             .60% on all net assets        .15% on all net assets

Emerging Markets       1.00% on all net assets        .15% on all net assets
Fund(*)

Growth Fund             .50% on all net assets        .15% on all net assets

Bond Fund(*)            .40% on all net assets        .15% on all net assets

Money Market Fund(*)    .30% on first $50 million     .15% on all net assets
                        and .20% on balance
                        over $50 million


<PAGE>
<CAPTION>

<S>                      <C>                           <C>

California              .40% on first $25 million;     .15% on all net assets
Intermediate            .35% on next $25 million;
Tax-Free Fund(*)        .30% on next $50 million;
                        .25% on next $50 million;
                        and .20% on balance over
                        $150 million

<FN>
(*)      The Advisor voluntarily waived all or a portion of its fees
         for these Funds during the fiscal year ended October 31,
         1996.  All fees waived in the past will not be recouped in
         the future and, as these waivers are voluntary, they may be
         reduced or eliminated in the future.  For the Emerging
         Markets Fund, the Advisor is voluntarily waiving advisory,
         12b-1 and administrative fees and reimbursing all other
         operating expenses until further notice.  For the Bond Fund
         and the Money Market Fund, the Advisor is voluntarily
         waiving the administrative fee in its entirety.  For the
         California Intermediate Tax-Free Fund, the advisory and
         administrative fees are being charged at voluntarily reduced
         rates of .30% and .005% of net assets, respectively.
</FN>
</TABLE>

         During the fiscal year ended October 31, 1996, the Advisor received
advisory and administrative fees from the Funds in the following amounts
(which are net of voluntary fee waivers):

         Global Fund                                              $3,997,557
         Emerging Markets Fund                                             0
         Growth Fund                                                 443,609
         Bond Fund                                                   316,693
         Money Market Fund                                           650,049
         California Intermediate Tax-Free Fund                       155,741

         The name and address of each subadvisor presently retained by the
Advisor with respect to the Funds and the rate of compensation paid by the
Advisor to each are set forth below.

<TABLE>
<CAPTION>

                                                                             Annual Rate of
                                    Subadvisor                               Compensation
                                    ------------------------                 ----------------
<S>                                 <C>                                      <C>
Bond Fund                           Pacific Investment                       .25% of average
                                    Management Company                       daily net assets
                                    840 Newport Center Drive
                                    Newport Beach, CA 92660

Growth Fund                         Sit Investment                           .40% of average
                                    Associates, Inc.                         daily net assets
                                    4600 Norwest Center
                                    Minneapolis, MN 55402


<PAGE>
<CAPTION>

<S>                                 <C>                                      <C>
Emerging Markets                    Credit Lyonnais                          .50% of average
Fund                                International Asset                      daily net assets
                                    Management (HK) Limited
                                    Three Exchange Square
                                    38 Connaught Place, 6th Floor
                                    Hong Kong

</TABLE>

For the fiscal year ended October 31, 1996, Pacific Investment Management
Company and Sit Investment Associates, Inc. received from the Advisor (not the
Funds) subadvisory fees of $198,574 and $81,991, respectively. Credit Lyonnais
International Asset Management (HK) Limited has agreed to waive its
subadvisory fees until further notice.

         INFORMATION ON THE ADVISOR. The Advisor is a wholly-owned subsidiary
of Fremont Investors, Inc., of which Stephen D. Bechtel, Jr. is the
controlling shareholder. The professional staff of the Advisor has offered
professional investment management services regarding asset allocation in
connection with securities portfolios to the Bechtel Group, Inc. Retirement
Plan and the Bechtel Foundation since 1978 and to Fremont Investors, Inc.
since 1987. The Advisor also provides investment advisory services regarding
asset allocation, investment manager selection and portfolio diversification
to a number of large Bechtel- related investors. In addition, the Advisor
provides investment management services to three other series of the Company:

<TABLE>
<CAPTION>

                                       Net Assets                    Annual Rate of Compensation
Name of Fund                          (Oct. 31, 1996)                       Paid to Advisor
- ------------                          ---------------                  ----------------------------
<S>                                   <C>                              <C>
Fremont International                 $ 35,272,746                     1.5% of average daily
Growth Fund                                                            net assets

Fremont International                    9,214,175                     1.5% of average daily
Small Cap Fund                                                         net assets

Fremont U.S. Micro-                    102,480,951                     2.5% on first $30 million
Cap Fund                                                               of average daily net assets;
                                                                       2% on next $70 million of
                                                                       such assets; and 1.5% of
                                                                       such assets in excess of
                                                                       $100 million

</TABLE>

Under the terms of the advisory agreement for the foregoing series, the
Advisor has agreed to bear all of such series' expenses, except extraordinary
expenses, interest, brokerage commissions and other transaction charges
relating to investment activities. An amended advisory agreement for each of
the foregoing series has also been submitted to shareholder of such series for
their approval.

         Under the terms of a shareholder services agreement with the Advisor,
effective July 1, 1996, the Funds pay the Advisor for transfer agent services
on a per shareholder account basis,


<PAGE>



subject to a monthly minimum per Fund, as well as out-of-pocket expenses.
Total costs incurred by the Funds in aggregate for the period July 1, 1996
through October 31, 1996 were $97,341.

         OTHER INFORMATION. Funds Distributor, Inc., Sixty State Street, Suite
1300, Boston, Massachusetts, serves as the principal underwriter for shares of
the Funds. MGF Service Corp., 312 Walnut Street, 21st Floor, Cincinnati, Ohio
45202, is retained by the Advisor to provide certain administrative, transfer
agency and shareholder services to the Funds.

II.      ELECTION OF DIRECTORS

     Seven directors are to be elected, each to serve for an indefinite term.
The following table sets forth certain information regarding each nominee for
election as a director by shareholders. Each nominee is a member of the
present Board of Directors.

<TABLE>
<CAPTION>

                                                                   Amount and
                                                                   Nature of          Compensation
Name and Principal Occupation                                      Beneficial         During the
During the Past Five Years                                         Ownership          Fiscal Year
and Directorships of                       Date of     Director    of Shares of       Ended October
Public Companies                           Birth       Since       the Company        31, 1996
- --------------------------                 -------     -------     -----------        --------
<S>                                        <C>         <C>         <C>                <C>

**DAVID L. REDO                             9-1-37      1988           *               $     0
President, Chief Executive
Officer and a director of
Fremont Investment Advisors,
Inc. (the investment
advisor to the Funds) and
Managing Director of
Fremont Group, L.L.C.  He is
also a director of Sequoia
Ventures, Sit/Kim International
Investment Associates and J.P.
Morgan Securities Asia.

**MICHAEL H. KOSICH                        3-30-40       1996          *               $     0
President and a director of
Fremont Mutual Funds, Inc.
He formerly was a
Senior Vice President of
Business Development of
Benham Management.

**VINCENT P. KUHN, JR.                      4-22-32      1988          *               $     0
Executive Vice President
and a director of Fremont
Investment Advisors, Inc.


<PAGE>
<CAPTION>

<S>                                        <C>         <C>         <C>                <C>

RICHARD E. HOLMES                           5-14-43     1988           *               $ 4,500
Vice President and a
director of BelMar Advisors,
Inc. (a marketing firm for
investment advisors).

WILLIAM W. JAHNKE                            2-6-44     1988           *               $ 4,500
Principal of Jahnke &
Associates (a consulting
company). He is also
Chairman of the Board of
Financial Design Education
Corp.  He is the former
Chairman of the Board of
Directors of Vestek Systems,
Inc. (an investment software
company).

DONALD C. LUCHESSA                          2-18-30     1991           *               $ 3,000
Principal of DCL Advisory (a 
marketing firm for investment 
advisors).

DAVID L. EGAN                                5-1-34     1996           *               $ 4,500
President of Fairfield
Capital Associates, Inc. (an
investment advisor) and
Fairfield Capital Funding,
Inc. (a registered
broker-dealer).

<FN>
*    As of January 13, 1997, each individual director or nominee owns of
     record or beneficially less than 1% of the outstanding shares of each
     of the Funds and of the Company as a whole.

**   Messrs. Redo, Kosich and Kuhn, as affiliated persons of Fremont
     Investment Advisors, Inc., the Company's investment advisor, are
     "interested persons" of the Company within the meaning of Section
     2(a)(19) of the Investment Company Act of 1940. Messrs. Redo, Kosich and
     Kuhn may directly or indirectly receive benefits from such affiliation.
</FN>
</TABLE>

         All nominees have consented to being named in this proxy statement
and have agreed to serve if elected. Directors on the Board who are not
interested persons of the Company receive an annual retainer of $8,000, an
additional $2,000 for each Board meeting attended, and reimbursement for
expenses incurred in attending the meeting.

         The Company has an Executive Committee comprised of Mr.
Redo, Mr. Kosich and Mr. Kuhn.  The Executive Committee is
responsible for managing the day-to-day business affairs of the


<PAGE>



Company.  The Company also has an Audit Committee and a Contracts Committee, 
each consisting of David L. Egan, Richard E. Holmes, William W. Jahnke and 
Donald C. Luchessa.  The Audit and Contracts Committees make recommendations 
to the Board of Directors as deemed necessary concerning the review of the
Company's investment advisory agreements and other service contracts, the 
selection of the Company's independent public accountants, and other matters 
related to the provision of services to the Company.  Committee members receive
no additional compensation for attending a Committee meeting.

         During the fiscal year ended October 31, 1996, the Board of Directors
held three meetings and the Audit and Contracts Committees each held two
meetings. During such fiscal year, each director attended at least 75% of the
aggregate of (i) the total number of meetings of the Board of Directors and
(ii) the total number of meetings held by all committees of the Board of
Directors on which he served.

         The directors of the Company intend to vote all of their shares for
approval of Proposal I and in favor of the Board nominees listed in this
proxy. As of the record date, all directors and officers as a group owned of
record or beneficially less than 1% of the outstanding shares of each of the
Funds and the Company as a whole.

         EXECUTIVE OFFICERS.  The Company's executive officers are
set forth below.  The business address of each officer is 333
Market Street, San Francisco, California 94105.

<TABLE>
<CAPTION>

                                            Date       Executive
Name and Principal Occupation               of         Officer         Position with
During the Past Five Years                  Birth      Since           the Company
- -----------------------------              -------    -----------     ----------------
<S>                                        <C>        <C>             <C>

DAVID L. REDO                               9-1-37     1988            Chairman and
(See page 7)                                                           Chief Executive
                                                                       Officer

MICHAEL H. KOSICH                          3-30-40     1996            President
(See page 7)

VINCENT P. KUHN, JR.                       4-22-32     1988            Executive Vice
(See page 7)                                                           President

ALBERT W. KIRSCHBAUM                       8-17-38     1993            Senior Vice
Senior Vice President                                                  President
and a director of
Fremont Investment
Advisors, Inc.

PETER F. LANDINI                           5-10-51     1988            Senior Vice
Senior Vice President                                                  President
and a Director of Fremont
Investment Advisors, Inc.


<PAGE>
<CAPTION>

<S>                                        <C>        <C>             <C>

TINA THOMAS                                 8-7-49     1996            Vice President,
Vice President of Fremont                                              Secretary and
Investment Advisors, Inc.                                              Chief Compliance
Prior to May 1996, she was a                                           Officer
Vice President and Chief
Compliance Officer of
Bailard, Biehl & Kaiser,
Inc., Treasurer of Bailard,
Biehl & Kaiser International
Fund Group, Inc. and Bailard,
Biehl & Kaiser Fund Group and
Principal of BB&K Fund
Services, Inc.

CHANTAL GAIDDON                            5-13-56     1996            Vice President,
Vice President and                                                     Controller and
Controller of Fremont                                                  Treasurer
Investment Advisors, Inc.

</TABLE>

III.     OTHER BUSINESS

                  The proxy holders have no present intention of bringing any
matter before the meeting other than the proposals set forth herein. Neither
the proxy holders nor the Board of Directors are aware of any matters which
may be presented by others. If any other business shall properly come before
the meeting, the proxy holders intend to vote thereon in accordance with their
best judgment.

                  Any shareholder proposal intended to be presented at the
next shareholder meeting must be received by the Company for inclusion in its
proxy statement and form of proxy relating to such meeting at a reasonable
time before the solicitation of proxies for the meeting is made. The Company
does not hold regularly scheduled annual meetings of shareholders.

OUTSTANDING SHARES AND VOTING REQUIREMENTS

         The Board of Directors has fixed the close of business on January 13,
1997 as the record date for the determination of shareholders entitled to
notice of and to vote at the special meeting of shareholders or any
adjournment thereof. As of the record date,there were 443,865,523.129 shares
of common stock, $0.0001 par value, of the Company outstanding, including
368,375,450.810 shares of the Fremont Money Market Fund, 43,029,026.392 shares
of the Fremont Global Fund, 7,320,214.507 shares of the Fremont Bond Fund,
7,534,704.747 shares of the Fremont Growth Fund, 5,472,584.631 shares of the
Fremont California Intermediate Tax-Free Fund and 417,220.209 shares of the
Fremont Emerging Markets Fund. All full shares of the Company are entitled to
one vote, with proportionate voting for fractional shares.


<PAGE>



         On October 31, 1996, Fremont Investors, Inc. and its affiliated
companies including their employee retirement plans, its principal
shareholder, Stephen D. Bechtel, Jr., and members of his family, including
trusts, owned of record or beneficially the following approximate percentages
of the outstanding shares of the Funds:

                                                                % of Shares
                                                                Outstanding

     Fremont Global Fund                                            62%
     Fremont Emerging Markets Fund                                  91%
     Fremont Growth Fund                                            65%
     Fremont Bond Fund                                              88%
     Fremont Money Market Fund                                      82%
     Fremont California Intermediate Tax-Free Fund                  65%

On January 13, 1997, the Advisor owned of record 47.7% of the outstanding
shares of the Emerging Markets Fund; BF Fund Limited, 50 Fremont Street, San
Francisco, California 94105, owned of record 6.2% of the outstanding shares of
the Global Fund, 65.2% of the outstanding shares of the Growth Fund and 70.9%
of the outstanding shares of the California Intermediate Tax-Free Fund;
Bankers Trust Company as Trustee for the Bechtel Master Trust for Qualified
Employees, P.O. Box 1742 Church Street Station, New York, New York 10008,
owned of record 44.5% of the outstanding shares of the Global Fund, 78.0% of
the outstanding shares of the Bond Fund and 54.4% of the outstanding shares of
the Money Market Fund; Fremont Investors, Inc., 50 Fremont Street, San
Francisco, California 94105, owned of record 8.6% of the outstanding shares of
the Money Market Fund; Sequoia Ventures, Inc., 50 Fremont Street, San
Francisco, California 94105, owned of record 8.4% of the outstanding shares of
the Bond Fund; William S. and Marion B. Slusser, 200 Deer Valley Road, San
Rafael, California 94903, owned of record 5.8% of the outstanding shares of
the California Intermediate Tax-Free Fund; Charles Schwab & Co., Inc., 101
Montgomery Street, San Francisco, California 94104, owned of record 6.5% of
the outstanding shares of the California Intermediate Tax-Free Fund; Fremont
Group L.L.C. Pension Plan, 50 Fremont Street, San Francisco, California 94105,
owned of record 8.5% of the outstanding shares of the Emerging Markets Fund;
The Northern Trust Company, as Trustee for the Fremont Group L.L.C. Retirement
Plan owned of record 5.4% of the outstanding shares of the Emerging Markets
Fund; and Fremont Investors, Inc. Pension Plan, 50 Fremont Street, San
Francisco, California 94105, owned of record 19.7% of the outstanding shares
of the Emerging Markets Fund. No other person owned of record and, according
to information available to the Funds, no other person owned beneficially, 5%
or more of the outstanding shares of any Fund on the record date.

         Approval of Proposal I requires the affirmative vote of a "majority
of the outstanding voting securities" of each Fund, as defined in the 1940
Act, which means the vote of two-thirds or more of the shares present at the
Meeting, if the holders of more


<PAGE>



than 50% of the outstanding shares are present or represented by proxy, or the
vote of more than 50% of the outstanding shares, whichever is less. If a
quorum (more than 50% of the outstanding shares of the Company) is represented
at the meeting, the vote of a plurality of the Company's shares represented at
the meeting is required for the election of directors (Proposal II below). If
a quorum is present at the meeting but sufficient votes to approve one or more
of the proposals described herein is not received, the persons named as
proxies may propose one or more adjournments of the meeting to permit further
solicitation of proxies. Any such adjournment will require the affirmative
vote of a majority of those shares represented at the meeting in person or by
proxy. A shareholder vote may be taken on any proposal in this proxy statement
prior to any such adjournment if sufficient votes have been received and it is
otherwise appropriate. Abstentions and "broker non-votes" are counted for
purposes of determining whether a quorum is present (and any vote for
adjournment) but do not represent votes cast with respect to a proposal.
"Broker non-votes" are shares held by a broker or nominee for which an
executed proxy is received by the Company, but are not voted as to one or more
proposals because instructions have not been received from the beneficial
owners or persons entitled to vote and the broker or nominee does not have
discretionary voting power.

                                          By Order of the Board of Directors,

                                          /s/ Tina Thomas
                                          Tina Thomas
                                          Secretary

Date: January 20, 1997

- ----------------------------------------------------------------
Please complete, date and sign the enclosed Proxy and return it
promptly in the enclosed reply envelope.  NO POSTAGE IS REQUIRED
IF MAILED IN THE UNITED STATES.


<PAGE>



                                   EXHIBIT A

                             AMENDED AND RESTATED
                              INVESTMENT ADVISORY
                                      AND
                       ADMINISTRATIVE SERVICES AGREEMENT

     THIS AGREEMENT, dated and effective as of the 15th day of November, 1988,
and amended as of this [ ] day of [ ], 1997, is made and entered into by and
between FREMONT MUTUAL FUNDS, INC., a Maryland corporation (hereinafter called
the "Company"), and FREMONT INVESTMENT ADVISORS, INC., a California
corporation (hereinafter called the "Advisor").

     WHEREAS, the Company is engaged in business as an open-end management
investment company and is so registered under the Investment Company Act of
1940 (the "1940 Act"); and

     WHEREAS, the Advisor is engaged principally in the business of rendering
investment advisory and management services and is so registered under the
Investment Advisers Act of 1940 (the "Advisers Act"); and

     WHEREAS, the Company is authorized to issue shares of capital stock in
separate series with each such series representing interests in a separate
portfolio of securities and other assets; and

     WHEREAS, the Company intends to initially offer shares in two series, the
Global Fund and Money Market Fund (the "Initial Series"), which together with
all other series subsequently established by the Company with respect to which
the Company desires to retain the Advisor to render investment advisory
services hereunder and the Advisor is willing so to do, being herein
collectively referred to as the "Series" and individually referred to as a
"Series";

     NOW, THEREFORE, WITNESSETH: That it is hereby agreed between
the parties hereto as follows:

     1.  (a)      INITIAL SERIES.  The Company hereby appoints the
Advisor to act as manager and investment adviser to the Initial
Series for the period and on the terms herein set forth.  The
Advisor accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.

         (b) ADDITIONAL SERIES. In the event that the Company establishes one
or more series of shares other than the Initial Series with respect to which
it desires to retain the Advisor to render management and investment advisory
services hereunder, it shall so notify the Advisor in writing, indicating the
advisory fee which will be payable with respect to the additional series of
shares. If the Advisor is willing to render such services, it shall so notify
the Company in writing, whereupon such series of shares shall become a Series
hereunder.

                                                     -A-1-


<PAGE>




     The Advisor shall, for all purposes herein, be deemed an independent
contractor and not an agent of the Company.

     2. (a) The Advisor agrees to provide general management services to the
Company and each Series and, subject to review and approval by the Company's
Board of Directors, will (i) set the Series' overall investment strategies;
(ii) select Subadvisor(s); (iii) allocate and, when appropriate, reallocate a
Series' assets among the Advisor and one or more Subadvisors; (iv) monitor and
evaluate the performance of Subadvisors; and (v) seek to ensure that the
Subadvisors comply with the Series' investment objectives, policies and
restrictions, giving due consideration to the policies of each Series as
expressed in the Company's Articles of Incorporation, Bylaws, Form N-1A
Registration Statement under the 1940 Act and under the Securities Act of
1933, and prospectus as in use from time to time, as well as to the factors
affecting the status of each Series as a "regulated investment company" under
the Internal Revenue Code of 1986. In its duties hereunder, the Advisor shall
further be bound by any and all determinations by the Board of Directors of
the Company relating to investment policy, which determinations shall in
writing be communicated to the Advisor. Subject to the foregoing, the Advisor
will exercise all voting rights with respect to portfolio securities and may
delegate such voting rights to any Subadvisor approved by the Board of
Directors.

         (b) To the extent authorized by the Board of Directors of the
Company, the Advisor shall make decisions for each Series as to foreign
currency matters and make determinations as to, and execute and perform,
foreign exchange contracts or may delegate such decisions to any Subadvisor
approved by the Board of Directors.

         (c) (i) The Advisor shall provide adequate facilities and qualified
personnel for the placement of, and shall place orders for the purchase, or
other acquisition, and sale, or other disposition, of portfolio securities for
each Series. With respect to such transactions, the Advisor, subject to such
direction as may be furnished from time to time by the Board of Directors of
the Company, shall endeavor as the primary objective to obtain the most
favorable prices and executions of orders. Subject to such primary objective,
the Advisor may place orders with brokerage firms which furnish statistical
and other information to the Advisor, taking into account the value and
quality of the brokerage services of such brokerage firms, including the
availability and quality of such statistical and other information. Receipt by
the Advisor of any such statistical and other information and services shall
not be deemed to give rise to any requirement for abatement of the advisory
fee payable to the Advisor pursuant to Section 7 hereof.

                                                     -A-2-


<PAGE>



              (ii) On occasions when the Advisor deems the purchase or sale of
a security to be in the best interests of a Series as well as other clients of
the Advisor, the Advisor, to the extent permitted by applicable laws and
regulations, may aggregate the securities to be so sold or purchased when the
Advisor believes that to do so will be in the best interests of the Series. In
such event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Advisor in the
manner the Advisor considers to be the most equitable and consistent with its
fiduciary obligations to the Series and to such other clients.

     3. Subject to prior approval of the Board of Directors, the Advisor may,
but is not required to, retain one or more investment management organizations
("Subadvisors") to make specific investment decisions with respect to all or a
portion of the assets of a particular Series. The Advisor may allocate
portions of a Series' assets among such Subadvisor(s) or among itself and such
Subadvisor(s). The Advisor shall monitor the performance of such
Subadvisor(s), shall allocate and reallocate assets among Subadvisors of
Series with multiple Subadvisors, and shall recommend the employment or
termination of a particular Subadvisor when deemed advisable. The Advisor will
compensate such Subadvisor(s) from its own resources, at no additional cost to
the Company.

     4. The Advisor shall furnish the services of persons to perform the
executive, administrative, clerical, and bookkeeping functions of the Company
(other than services involving the custody of portfolio securities), including
the daily determination of net asset value of each Series. The Advisor shall
pay the compensation and travel expenses of all the Company, and they shall
serve without additional compensation from the Company. The Advisor shall
also, at its expense, provide the Company with suitable office space (which
may be in the offices of the Advisor); all necessary small office equipment
and utilities; and general purpose accounting forms, supplies, and postage
used at the offices of the Company. These services are exclusive of the
necessary services and records of any dividend disbursing agent, transfer
agent, registrar or custodian, and accounting and bookkeeping services to be
provided by the custodian.

     5. The Company shall pay all its expenses not assumed by the Advisor as
provided herein. Such expenses shall include, but shall not be limited to,
computer services, custodian, registrar, stock transfer and dividend
disbursing fees and expenses; costs of the designing, printing and mailing of
reports, prospectuses, proxy statements, and notices to its shareholders;
interest, taxes and insurance; expenses of the issuance and redemption of
shares of each Series (including stock certificates, registration

                                                     -A-3-


<PAGE>



and qualification fees and expenses); legal and auditing expenses;
compensation, fees, and expenses paid to Directors; association dues;
compensation to organizations hired for sub- transfer agency services,
including where such services are specific to retirement plans using the
Series as investment options; costs of stationery and forms prepared
exclusively for the Company; and costs of assembling and storing shareholder
account data.

     6. (a) Each Series shall pay to the Advisor on or before the tenth (10th)
day of each month, as compensation for the services rendered by the Advisor
during the preceding month, an amount to be computed by applying to the total
net asset value of such Series the applicable annual rates set forth on
Appendix A hereto plus an administrative fee for each Series of .15% of total
net asset value.

         (b) The fees on Appendix A shall be computed and accrued daily at one
three-hundred-sixty-fifth (1/365th) or one three- hundred-sixty-sixth
(1/366th), as appropriate, of the applicable rates set forth therein. The net
asset value of each Series shall be determined in the manner set forth in the
Articles of Incorporation and Prospectus of the Company after the close of the
New York Stock Exchange on each day on which said Exchange is open, and in the
case of Saturdays, Sundays, and other days on which said exchange shall not be
open, in the manner further set forth in said Articles of Incorporation and
Prospectus. In the event of termination other than at the end of a calendar
month, the monthly fee shall be prorated for the portion of the month prior to
termination and paid on or before the tenth (10th) day subsequent to
termination.

         (c) Notwithstanding the foregoing, the administrative fee will not
exceed $24,000 per annum for each Series until the total net asset value of
such Series equals or exceeds $30 million and will not exceed $40,000 per
annum for each Series until the total net asset value of such Series equals or
exceeds $50 million.

     7. (a) The Advisor agrees to reduce the fee payable to it under this
Agreement by the amount by which the ordinary operating expenses of the
Company for any fiscal year of the Company, excluding interest, taxes and
extraordinary expenses, shall exceed the most stringent limits prescribed by
any state in which the Company shares are offered for sale, based on the
average total net asset value of the Company determined pursuant to Section 6.
Costs incurred in connection with the purchase or sale of portfolio
securities, including brokerage fees and commissions, which are capitalized in
accordance with generally accepted accounting principles applicable to
investment companies, shall be accounted for as capital items and not as

                                                     -A-4-


<PAGE>



expenses. Proper accruals shall be made by the Company for any projected
reduction hereunder and corresponding amounts shall be withheld from the fees
paid by the Company to the Advisor. Any additional reduction computed at the
end of the fiscal year shall be deducted from the fee for the last month of
such fiscal year.

         (b) The above provision in subsection (a) with respect to expense
limitation shall be calculated and administered separately with respect to
each Series, as opposed to the Company in the aggregate, if and to the extent
so required by state securities authorities.

     8. Nothing contained in this Agreement shall be construed to prohibit the
Advisor from performing investment advisory, management, or distribution
services for other investment companies and other persons or companies, or to
prohibit affiliates of the Advisor from engaging in such businesses or in
other related or unrelated businesses.

     9. The Company agrees (i) not to hold the Advisor or any of its officers,
directors, agents or employees liable for, and (ii) to indemnify or insure the
Advisor and its officers, directors, agents and employees ("Indemnified
Parties") against, any costs and liabilities the Indemnified Parties may incur
as a result of any claim against the Indemnified Parties in the good faith
exercise of their powers hereunder (excepting matters as to which the
Indemnified Parties shall be finally adjudged to have been guilty of willful
misconduct or gross negligence, or in violation of applicable law) or arising
out of an act or omission of the custodian, subadvisor or of any broker or
agent selected by the Advisor in a commercially reasonable manner.

     10. (a) This Agreement shall become effective with respect to the Initial
Series on the date hereof (the "Effective Date") and, with respect to any
additional Series, on the date of receipt by the Company of notice from the
Advisor in accordance with Section 1(b) hereof that the Advisor is willing to
serve as Advisor with respect to such Series. Unless terminated as herein
provided, this Agreement shall remain in full force and effect for two (2)
years from the Effective Date with respect to the Initial Series and, with
respect to each additional Series, until the anniversary of the Effective Date
following the first anniversary of the date on which such Series becomes a
Series hereunder, and shall continue in full force and effect for periods of
one year thereafter with respect to each Series so long as such continuance
with respect to any such Series is approved at least annually (i) by either
the Directors of the Company or by a vote of a majority (as defined in the
1940 Act) of the outstanding voting securities of such Series, and (ii) in
either event by the vote of a majority of the Directors of the Company who are
not parties to this Agreement or "interested

                                                     -A-5-


<PAGE>



persons" (as defined in the 1940 Act) of any such party, cast in person at a
meeting called for the purpose of voting on such approval. However, the
continuance of this Agreement with respect to any Series is subject to the
approval of this Agreement by a majority (as defined in the 1940 Act) of the
outstanding voting securities of such Series on or before the next anniversary
following the date on which such Series becomes a Series hereunder.

         Any approval of this Agreement by a majority (as defined in the 1940
Act) of the outstanding voting securities of any Series shall be effective to
continue this Agreement with respect to any such Series notwithstanding (i)
that this Agreement has not been approved by the holders of a majority (as
defined in the 1940 Act) of the outstanding voting securities of any other
Series affected thereby, and (ii) that this Agreement has not been approved by
the vote of a majority (as defined in the 1940 Act) of the outstanding voting
securities of the Company, unless such approval shall be required by any
applicable law or otherwise.

         (b) This Agreement may be terminated with respect to any Series at
any time, without payment of any penalty, by the Board of Directors of the
Company or by the vote of a majority (as defined in the 1940 Act) of the
outstanding voting securities of the Company, on thirty (30) days' written
notice to the Advisor, or by the Advisor on like notice to the Company.

         (c) This Agreement shall automatically and immediately terminate in 
the event of its assignment.

         (d) This Agreement shall be governed by the laws of the State of
California, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Advisers Act or rules or orders of the SEC
thereunder.

         (e) No provision of this Agreement may be changed, waived, discharged
or terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought and no amendment of this Agreement shall be effective until approved by
a vote of a majority of the outstanding voting securities of the Series, if
such approval is required by applicable law.

     11. (a) This Agreement supersedes any prior agreement relating to the 
subject matter hereof between the parties.

         (b) If any provision of this Agreement shall be held or made 
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.

                                                     -A-6-


<PAGE>



     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate originals by their officers thereunto duly authorized as
of the date first above written.

FREMONT MUTUAL FUNDS, INC.                   FREMONT INVESTMENT ADVISORS, INC.

By:_________________________                 By:______________________________
    David L. Redo, Chairman                      David L. Redo, President

ATTEST:                                      ATTEST:
    ________________________                     _____________________________
    Tina Thomas, Secretary                       Tina Thomas, Secretary

                                                     -A-7-


<PAGE>





                            EFFECTIVE JUNE 24, 1996

                                  APPENDIX A
                            to Investment Advisory
                     and Administrative Services Agreement

<TABLE>
<CAPTION>

   On the Portion of
Daily Total Net Asset Value                                            Annual Rate
- ---------------------------                                            -----------
<S>                                                                    <C>

Global Fund:                                                               .60%

Money Market Fund:

     First $50 million                                                     .30%
     In excess of $50 million                                              .20%


California Intermediate Tax-Free Fund:

     First $25 million                                                     .40%
     Next $25 million                                                      .35%
     Next $50 million                                                      .30%
     Next $50 million                                                      .25%
     In excess of $150 million                                             .20%

Growth Fund:                                                               .50%

Bond Fund:                                                                 .40%

Emerging Markets Fund:                                                    1.00%

                                                     -A-8-

</TABLE>
<PAGE>



                          FREMONT MUTUAL FUNDS, INC.
                         333 Market Street, 26th Floor
                        San Francisco, California 94105

- -----------------------------------------------------------------------------
                   NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
                      Fremont International Growth Fund,
                     Fremont International Small Cap Fund
                        and Fremont U.S. Micro-Cap Fund

                        To Be Held on February 28, 1997
- -----------------------------------------------------------------------------

         NOTICE IS HEREBY GIVEN that a special meeting of shareholders of
Fremont Mutual Funds, Inc. will be held in the main conference room on the
26th floor of 333 Market Street, San Francisco, California 94105, on Friday,
February 28, 1997 at 9:00 a.m. to consider and vote on the following matters:

1.       To approve or disapprove a proposal to amend the Investment
         Advisory and Administrative Services Agreement with Fremont
         Investment Advisors, Inc. (the "Advisor") in order to permit
         the Advisor to hire and terminate subadvisors or modify
         subadvisory agreements without shareholder approval;

2.       To elect seven directors, each to serve for an indefinite
         term; and

3.       To transact any other business, not currently contemplated,
         that may properly come before the meeting in the discretion
         of the proxies or their substitutes.

         Shareholders of record at the close of business on January 13, 1997
are entitled to notice of and to vote at this meeting or any adjournment
thereof.

                                          By order of the Board of Directors,

                                          /s/ Tina Thomas
                                          Tina Thomas, Secretary

January 20, 1997

- -----------------------------------------------------------------------------
         Please execute the enclosed proxy and return it promptly in the
enclosed envelope, thus avoiding unnecessary expense and delay. No postage is
required if mailed in the United States. The proxy is revocable and will not
affect your right to vote in person if you attend the meeting.


<PAGE>



                          FREMONT MUTUAL FUNDS, INC.
                         333 MARKET STREET, 26TH FLOOR
                        SAN FRANCISCO, CALIFORNIA 94105

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

                        SPECIAL MEETING OF SHAREHOLDERS
                      Fremont International Growth Fund,
                     Fremont International Small Cap Fund
                        and Fremont U.S. Micro-Cap Fund

                        To Be Held on February 28, 1997

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

                                PROXY STATEMENT

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

         This Proxy Statement is furnished in connection with the solicitation
by the board of directors (the "Board of Directors" or "Board") of Fremont
Mutual Funds, Inc. (the "Company") of proxies for use at the special meeting
of shareholders or at any adjournment thereof. The Proxy Statement and form of
proxy were first mailed to shareholders on or about January 29, 1997.

         The Company is comprised of nine separate series. This Proxy
Statement is being furnished to the shareholders of the following three
series: Fremont International Growth Fund, Fremont International Small Cap
Fund and Fremont U.S. Micro-Cap Fund (each individually referred to herein as
a "Fund," and collectively as the "Funds"). A separate proxy statement has
been furnished to the shareholders of the remaining six series of the Company.

         The primary purpose of the special meeting is to approve a proposal
to amend the Investment Advisory and Administrative Services Agreement between
the Company, on behalf of the Funds, and Fremont Investment Advisors, Inc.
(the "Advisor") in order to permit the Advisor to hire or terminate
subadvisors or modify subadvisory agreements without shareholder approval.
Shareholders are also being asked to elect seven directors to serve on the
Board.

         A proxy, if properly executed, duly returned and not revoked, will be
voted in accordance with the specifications therein. A proxy which is properly
executed that has no voting instructions to a proposal will be voted for that
proposal. A shareholder may revoke a proxy at any time prior to use by filing
with the Secretary of the Company an instrument revoking the proxy, by
submitting a proxy bearing a later date, or by attending and voting at the
meeting.

         The Company has retained Management Information Services
Corp. ("MIS") to solicit proxies for the special meeting.  MIS is
responsible for printing proxy cards, mailing proxy material to
shareholders, soliciting brokers, custodians, nominees and

                                                      -1 -


<PAGE>



fiduciaries, tabulating the returned proxies and performing other proxy
solicitation services. The anticipated cost to the Funds of such services is
approximately $7,500, and will be paid by the Advisor. The Funds will also pay
the printing and postage costs of soliciting Fund shareholders.

         In addition to solicitation through the mails, proxies may be
solicited by officers, employees and agents of the Company without additional
cost to the Funds. Such solicitation may be by telephone, facsimile or
otherwise. The Funds will reimburse MIS, brokers, custodians, nominees and
fiduciaries for the reasonable expenses incurred by them in connection with
forwarding solicitation material to the beneficial owners of shares held of
record by such persons.

         THE COMPANY'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED OCTOBER 31,
1996 IS AVAILABLE AT NO CHARGE BY WRITING TO THE COMPANY AT 50 BEALE STREET,
SUITE 100, SAN FRANCISCO, CALIFORNIA 94105, OR BY CALLING THE COMPANY
NATIONWIDE TOLL-FREE 800-548- 4539 (PRESS 1).

I.       APPROVAL OR DISAPPROVAL OF A PROPOSAL TO AMEND THE ADVISORY
         AGREEMENT TO PERMIT THE ADVISOR TO HIRE AND TERMINATE
         SUBADVISORS OR MODIFY SUBADVISORY AGREEMENTS WITHOUT
         SHAREHOLDER APPROVAL

         The Advisor currently serves as investment advisor to the Funds
pursuant to an Investment Advisory and Administrative Services Agreement (the
"Advisory Agreement") with the Company. The Advisor currently employs
subadvisors with respect to two of the Funds and may engage additional
subadvisors with respect to each Fund in the future. The Company is proposing
to amend the Advisory Agreement to permit the Company and the Advisor to enter
into, terminate or modify subadvisory agreements on behalf of any Fund with
subadvisors without obtaining the prior approval of a majority of the
outstanding voting securities of such Fund, as is otherwise required by
Section 15(a) of the Investment Company Act of 1940 (the "1940 Act").

         Section 15(a) of the 1940 Act and Rule 18f-2 thereunder require that
the shareholders of a Fund approve that Fund's subadvisory agreement(s) and
any amendments thereto. On December 16, 1996, the Company and the Advisor
received from the Securities and Exchange Commission an order (the "SEC
Order") exempting the Funds from these provisions. The SEC Order permits the
Advisor to hire new subadvisors, terminate subadvisors, rehire existing
subadvisors whose agreements have been assigned (and, thus, automatically
terminated), and modify subadvisory agreements without the prior approval of
shareholders. By eliminating shareholder approval in these matters, the
Advisor would have greater flexibility in managing subadvisors, and
shareholders would save the considerable expenses involved in holding
shareholder meetings and soliciting proxies. Pursuant to the SEC Order, the
Company and the Advisor have agreed to the imposition of the following
conditions:

                                                      -2 -


<PAGE>



         (1) The Advisor will not enter into a subadvisory agreement with a
subadvisor that is an "affiliated person," as defined in the 1940 Act, of the
Company or the Advisor (an "Affiliated Manager"), other than by reason of
serving as a subadvisor to one or more of the Funds, without such agreement,
including the compensation to be paid thereunder, being approved by the
shareholders of the applicable Fund.

         (2) At all times, a majority of the Company's directors will be
persons each of whom is not an "interested person" of the Company as defined
in the 1940 Act ("Independent Directors"), and the nomination of new or
additional Independent Directors will be placed with the discretion of the
then existing Independent Directors.

         (3) When a subadvisor change is proposed for a Fund with an
Affiliated Manager, the Company's directors, including a majority of the
Independent Directors, will make a separate finding, reflected in the
Company's board minutes, that such change is in the best interests of the Fund
and its shareholders and does not involve a conflict of interest from which
the Advisor or the Affiliated Manager derives an inappropriate advantage.

         (4) The Advisor will provide general management services to the
Company and the Funds and, subject to review and approval by the Company's
Board of Directors, will (i) set the Funds' overall investment strategies;
(ii) select subadvisor(s); (iii) allocate and, when appropriate, reallocate a
Fund's assets among the Advisor and one or more subadvisors; (iv) monitor and
evaluate the performance of subadvisors; and (v) seek to ensure that the
subadvisors comply with the Funds' investment objectives, policies and
restrictions.

         (5) Within 60 days of the hiring of any new subadvisor or the
implementation of any proposed material change in a subadvisory agreement, the
Advisor will furnish shareholders all information about the new subadvisor or
subadvisory agreement that would be included in a proxy statement. Such
information will include the fees paid by the Advisor to the subadvisor and
any change in such disclosure caused by the addition of a new subadvisor or
any proposed material change in a subadvisory agreement. The Advisor will meet
this condition by providing shareholders with an information statement which
meets the requirements of the proxy rules under applicable federal securities
laws.

         (6) The Funds will disclose in their respective Prospectuses the
existence, substance and effect of the SEC Order.

         (7) Before a Fund may rely on the SEC Order, the operations of the
Fund in the manner described therein will be approved by a majority of such
Fund's outstanding voting securities, as defined in the 1940 Act.

                                                      -3 -


<PAGE>




         (8) No director or officer of the Company or the Advisor will own
directly or indirectly (other than through a pooled investment vehicle that is
not controlled by any such director or officer) any interest in a subadvisor
except for (i) ownership of interests in the Advisor or any entity that
controls, is controlled by or is under common control with the Advisor; (ii)
ownership of less than 1% of the outstanding securities of any class of equity
or debt of a publicly-traded company that is either a subadvisor or an entity
that controls, is controlled by or is under common control with a subadvisor.

         In accordance with condition (7), shareholder approval of this
proposed new arrangement is being sought. Even if a Fund's shareholders
approve this arrangement, any new subadvisors engaged or terminated with
respect to such Fund or any change in a subadvisory agreement with respect to
such Fund will still require approval of the Board of Directors. In order to
approve new subadvisors, the Board will analyze the factors they deem
relevant, including the nature, quality and scope of services provided by
subadvisors to investment companies comparable to the Funds. The Board will
review the ability of the subadvisor to provide its services to the Funds, as
well as its personnel, operation, financial condition or any other factor
which would affect the provision of these services. The Board will examine the
performance of the subadvisor with respect to compliance and regulatory
matters over the past fiscal year. The Board will review the subadvisor's
investment performance with respect to accounts deemed comparable. Finally,
the Board will consider other factors deemed relevant to the subadvisor's
performance as an investment advisor. The Board believes that this review
provides adequate shareholder protection in the selection of subadvisors.

         On October 30, 1996, the Board of Directors of the Company, including
a majority of the Independent Directors, unanimously approved, subject to the
required shareholder approval described herein, proposed amendments to the
Advisory Agreement to specifically permit the Advisor to hire and terminate
subadvisors or modify subadvisory agreements without shareholder approval. If
this Proposal is approved by shareholders of each Fund, the Advisory Agreement
will be amended to include the following new paragraph:

                  Subject to prior approval of the Board of Directors, the
                  Advisor may, but is not required to, retain one or more
                  investment management organizations ("Subadvisors") to make
                  specific investment decisions with respect to all or a
                  portion of the assets of a particular Series. The Advisor
                  may allocate portions of a Series' assets among

                                                      -4 -


<PAGE>



                  such Subadvisor(s) or among itself and such Subadvisor(s).
                  The Advisor shall monitor the performance of such
                  Subadvisor(s), shall allocate and reallocate assets among
                  Subadvisors of Series with multiple Subadvisors, and shall
                  recommend the employment or termination of a particular
                  Subadvisor when deemed advisable. The Advisor will
                  compensate such Subadvisor(s) from its own resources, at no
                  additional cost to the Company.

         Except for the foregoing change and certain other non-material
changes deemed appropriate by the Board of Directors in light of the SEC
Order, all other provisions in the Advisory Agreement will remain identical in
all material respects.

         The Advisory Agreement, as proposed to be amended, is included herein
as Exhibit A.

         THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE
PROPOSAL TO AMEND THE ADVISORY AGREEMENT. If the shareholders of any Fund do
not approve this Proposal, the Advisory Agreement currently in place will
continue with respect to such Fund and the terms and conditions of the SEC
Order will not be applicable to such Fund.

         THE ADVISORY AGREEMENT. The Advisor provides each Fund with
investment management and administrative services pursuant to the Advisory
Agreement. The Advisory Agreement provides that the Advisor shall furnish
advice to each Fund with respect to its investments and shall, to the extent
authorized by the Board of Directors, determine what securities shall be
purchased or sold by the Fund. As described more fully below, the Advisor
presently retains subadvisors to provide portfolio management services to the
Fremont International Small Cap Fund and the Fremont U.S. Micro-Cap Fund. The
Advisor oversees the portfolio management of the Funds, including the services
provided by the subadvisors. The Advisor provides direct portfolio management
services to the extent that a subadvisor does not provide those services. The
Advisor has agreed to bear all of the Funds' expenses, except extraordinary
expenses, interest, brokerage commissions and other transaction charges
relating to investment activities.

         The Advisory Agreement has never before been submitted for a vote to
public shareholders of the Company. The Advisory Agreement was last approved
by the Board of Directors, including a majority of the Independent Directors,
on January 25, 1996 with respect to the International Growth Fund and the
International Small Cap Fund, and on June 18, 1996 with respect to the U.S.
Micro-Cap Fund.

                                                      -5 -


<PAGE>



         The Advisory Agreement requires that brokerage orders for each Fund's
portfolio securities transactions are placed by the Advisor or a subadvisor,
as applicable. The Advisor and subadvisors seek to obtain the best available
prices in the Funds' portfolio transactions, taking into account the costs and
promptness of executions. Subject to this policy, transactions may be directed
to those broker-dealers who provide research, statistical and other
information to the Funds, the Advisor or the subadvisors who provide
assistance with respect to the distribution of Fund shares. Subject to the
requirements of the 1940 Act and procedures adopted by the Board of Directors,
the Funds may execute portfolio transactions through any broker or dealer and
pay brokerage commissions to a broker which is an affiliated person of the
Company, the Advisor or a subadvisor.

         The Advisory Agreement may be renewed annually, provided that any
such renewal has been specifically approved by (i) the Board of Directors, or
by the vote of a majority (as defined in the 1940 Act) of the outstanding
voting securities of a Fund, and (ii) the vote of a majority of the
Independent Directors, cast in person, at a meeting called for the purpose of
voting on such approval. The Advisory Agreement also provides that either
party thereto has the right with respect to any Fund to terminate it without
penalty upon sixty days' written notice to the other party, and that the
Advisory Agreement terminates automatically in the event of its assignment.

         For the services provided under the Advisory Agreement, the Advisor
receives a fee based on the average daily net assets of each Fund at the
following annual rates:

<TABLE>
<CAPTION>

                                                          ADVISORY FEE
                                                      -------------------------
<S>                                                   <C>

International Growth Fund                             1.50% on all net assets

International Small Cap Fund(*)                       1.50% on all net assets

U.S. Micro-Cap Fund(*)                                2.50% on first $30 million;
                                                      2.00% on next $70 million;
                                                      and 1.50% on balance over
                                                      $100 million
<FN>
(*)      The Advisor voluntarily waived all or a portion of its fees for these
         Funds during the fiscal year ended October 31, 1996. All fees waived
         in the past will not be recouped in the future and, as these waivers
         are voluntary, they may be reduced or eliminated in the future.
</FN>
</TABLE>

         During the fiscal year ended October 31, 1996, the Advisor received
advisory fees from the Funds in the following amounts (which are net of
voluntary fee waivers):

         International Growth Fund                          $548,887
         International Small Cap Fund                        114,739
         U.S. Micro-Cap Fund                                 889,829

                                                      -6 -


<PAGE>



         The name and address of each subadvisor presently retained by the
Advisor with respect to the Funds and the rate of compensation paid by the
Advisor to each are set forth below.

<TABLE>
<CAPTION>

                                                                    Annual Rate of
                             Subadvisor                             Compensation
                             ---------------------                  --------------------
<S>                          <C>                                    <C>

International                Acadian Asset                          .75% of the first
Small Cap Fund               Management, Inc.                       $50 million of
                             Two International Place                average daily net
                             Boston, MA 02110                       assets; .65% of next
                                                                    $50 million of such
                                                                    assets; .50% of next
                                                                    $100 million of such
                                                                    assets; and .40% of
                                                                    such assets in excess
                                                                    of $200 mllion

U.S. Micro-Cap               Morgan Grenfell                        1.50% of the first
Fund                         Capital Management, Inc.               $30 million of
                             885 Third Avenue                       average daily net
                             New York, NY 10022                     assets; 1.00% of next
                                                                    $70 million of such
                                                                    assets; and .75% of
                                                                    such assets in excess
                                                                    of $100 million

</TABLE>

For the fiscal year ended October 31, 1996, Acadian Asset
Management, Inc. and Morgan Grenfell Capital Management, Inc.
received from the Advisor (not the Funds) subadvisory fees (net
of voluntary fee waivers) of $0 and $364,583, respectively.

         INFORMATION ON THE ADVISOR. The Advisor is a wholly-owned subsidiary
of Fremont Investors, Inc., of which Stephen D. Bechtel, Jr. is the
controlling shareholder. The professional staff of the Advisor has offered
professional investment management services regarding asset allocation in
connection with securities portfolios to the Bechtel Group, Inc. Retirement
Plan and the Bechtel Foundation since 1978 and to Fremont Investors, Inc.
since 1987. The Advisor also provides investment advisory services regarding
asset allocation, investment manager selection and portfolio diversification
to a number of large Bechtel- related investors. In addition, the Advisor
provides investment management services to six other series of the Company:

                                                      -7 -


<PAGE>
<TABLE>
<CAPTION>


                                        Net Assets                     Annual Rate of Advisory Fee
Name of Fund                         (Oct. 31, 1996)                       Paid to Advisor(*)
- ------------                          ---------------                  -----------------------
<S>                                   <C>                              <C>

Fremont Global Fund                   $572,150,236                     .60% of average daily
                                                                       net assets

Fremont Emerging                         3,771,749                     1.00% of average daily
Markets Fund                                                           net assets

Fremont Growth Fund                     78,624,112                     .50% of average daily
                                                                       net assets

Fremont Bond Fund                       70,577,063                     .40% of average daily
                                                                       net assets

Fremont Money Market                   329,651,919                     .30% of first $50 million
Fund                                                                   of average daily net assets
                                                                       and .20% of such assets in
                                                                       excess of $50 million

Fremont California                      51,156,044                    .40% of first $25 million
Intermediate Tax-                                                      of average daily net assets;
Free Fund                                                              .35% of next $25 million of
                                                                       of such assets; .30% of next
                                                                       $50 million of such assets;
                                                                       .25% of next $50 million
                                                                       of such assets; and .20% of
                                                                       such assets in excess
                                                                       of $150 million

<FN>
(*)      In addition to the advisory fee, the advisory agreement for
         each of these series provides that such series will pay to
         the Advisor an administrative fee of .15% per annum of
         averge net assets.  The Advisor is currently waiving all or
         a portion of its administrative fees for the Fremont Bond
         Fund, the Fremont Money Market Fund and the Fremont
         California Intermediate Tax-Free Fund.  With respect to the
         Fremont Emerging Markets Fund, the Advisor is currently
         waiving all of its advisory fees and administrative fees and
         reimbursing the Fund for all of its other operating
         expenses.
</FN>
</TABLE>

         Under the terms of the advisory agreement for the foregoing series,
such series bear all their own expenses. An amended advisory agreement for
each of the foregoing series has also been submitted to shareholder of such
series for their approval.

         OTHER INFORMATION.  The Advisor also serves as the Funds'
transfer agent.  Funds Distributor, Inc., Sixty State Street,
Suite 1300, Boston, Massachusetts, serves as the principal
underwriter for shares of the Funds.  MGF Service Corp., 312

                                                      -8 -


<PAGE>



Walnut Street, 21st Floor, Cincinnati, Ohio 45202, is retained by the Advisor
to provide certain administrative, transfer agency and shareholder services to
the Funds.

II.      ELECTION OF DIRECTORS

     Seven directors are to be elected, each to serve for an indefinite term.
The following table sets forth certain information regarding each nominee for
election as a director by shareholders. Each nominee is a member of the
present Board of Directors.

<TABLE>
<CAPTION>

                                                                    Amount and
                                                                    Nature of          Compensation
Name and Principal Occupation                                       Beneficial         During the
During the Past Five Years                   Date                   Ownership          Fiscal Year
and Directorships of                         of        Director     of Shares of       Ended October
Public Companies                             Birth     Since        the Company        31, 1996
- -----------------------------                -----     -------      -----------        ---------
<S>                                         <C>       <C>          <C>                <C>

**DAVID L. REDO                              9-1-37    1988             *                $     0
President, Chief Executive
Officer and a director of
Fremont Investment Advisors,
Inc. (the investment
advisor to the Funds) and
Managing Director of
Fremont Group, L.L.C.  He is
also a director of Sequoia
Ventures, Sit/Kim International
Investment Associates and J.P.
Morgan Securities Asia.

**MICHAEL H. KOSICH                         3-30-40    1996             *                $     0
President and a director of
Fremont Mutual Funds, Inc.
He formerly was a
Senior Vice President of
Business Development of
Benham Management.

**VINCENT P. KUHN, JR.                      4-22-32    1988             *                $     0
Executive Vice President
and a director of Fremont
Investment Advisors, Inc.

RICHARD E. HOLMES                           5-14-43    1988             *                $ 4,500
Vice President and a
director of BelMar Advisors,
Inc. (a marketing firm for
investment advisors).

                                                      -9 -


<PAGE>
<CAPTION>

<S>                                         <C>       <C>          <C>                <C>

WILLIAM W. JAHNKE                            2-6-44    1988             *                $ 4,500
Principal of Jahnke &
Associates (a consulting
company). He is also
Chairman of the Board of
Financial Design Education
Corp.  He is the former
Chairman of the Board of
Directors of Vestek Systems,
Inc. (an investment software
company).

DONALD C. LUCHESSA                          2-18-30    1991              *               $ 3,000
Principal of DCL Advisory (a 
marketing firm for investment 
advisors).

DAVID L. EGAN                                5-1-34    1996              *               $ 4,500
President of Fairfield
Capital Associates, Inc. (an
investment advisor) and
Fairfield Capital Funding,
Inc. (a registered
broker-dealer).

<FN>
*     As of January 13, 1997, each individual director or nominee owns of
      record or beneficially less than 1% of the outstanding shares of each
      of the Funds and of the Company as a whole.

**   Messrs. Redo, Kosich and Kuhn, as affiliated persons of Fremont
     Investment Advisors, Inc., the Company's investment advisor, are
     "interested persons" of the Company within the meaning of Section
     2(a)(19) of the Investment Company Act of 1940. Messrs. Redo, Kosich and
     Kuhn may directly or indirectly receive benefits from such affiliation.
</FN>
</TABLE>

         All nominees have consented to being named in this proxy statement
and have agreed to serve if elected. Directors on the Board who are not
interested persons of the Company receive an annual retainer of $8,000, an
additional $2,000 for each Board meeting attended, and reimbursement for
expenses incurred in attending the meeting.

         The Company has an Executive Committee comprised of Mr.
Redo, Mr. Kosich and Mr. Kuhn.  The Executive Committee is
responsible for managing the day-to-day business affairs of the
Company.  The Company also has an Audit Committee and a Contracts
Committee, each consisting of David L. Egan, Richard E. Holmes,
William W. Jahnke and Donald C. Luchessa.  The Audit and
Contracts Committees make recommendations to the Board of

                                                      -10 -


<PAGE>



Directors as deemed necessary concerning the review of the Company's
investment advisory agreements and other service contracts, the selection of
the Company's independent public accountants, and other matters related to the
provision of services to the Company. Committee members receive no additional
compensation for attending a Committee meeting.

         During the fiscal year ended October 31, 1996, the Board of Directors
held three meetings and the Audit and Contracts Committees each held two
meetings. During such fiscal year, each director attended at least 75% of the
aggregate of (i) the total number of meetings of the Board of Directors and
(ii) the total number of meetings held by all committees of the Board of
Directors on which he served.

         The directors of the Company intend to vote all of their shares for
approval of Proposal I and in favor of the Board nominees listed in this
proxy. As of the record date, all directors and officers as a group owned of
record or beneficially less than 1% of the outstanding shares of each of the
Funds and the Company as a whole.

         EXECUTIVE OFFICERS.  The Company's executive officers are
set forth below.  The business address of each officer is 333
Market Street, San Francisco, California 94105.

<TABLE>
<CAPTION>

                                         Date          Executive
Name and Principal Occupation            of            Officer           Position with
During the Past Five Years               Birth         Since             the Company
- -----------------------------            -----         ---------         -----------------
<S>                                      <C>           <C>               <C>

DAVID L. REDO                             9-1-37        1988              Chairman and
(See page 7)                                                              Chief Executive
                                                                          Officer

MICHAEL H. KOSICH                        3-30-40        1996              President
(See page 7)

VINCENT P. KUHN, JR.                     4-22-32        1988              Executive Vice
(See page 7)                                                              President

ALBERT W. KIRSCHBAUM                     8-17-38        1993              Senior Vice
Senior Vice President                                                     President
and a director of
Fremont Investment
Advisors, Inc.

PETER F. LANDINI                         5-10-51        1988              Senior Vice
Senior Vice President                                                     President
and a Director of Fremont
Investment Advisors, Inc.

                                                      -11 -


<PAGE>
<CAPTION>

<S>                                      <C>           <C>               <C>

TINA THOMAS                               8-7-49        1996              Vice President,
Vice President of Fremont                                                 Secretary and
Investment Advisors, Inc.                                                 Chief Compliance
Prior to May 1996, she was a                                              Officer
Vice President and Chief
Compliance Officer of
Bailard, Biehl & Kaiser,
Inc., Treasurer of Bailard,
Biehl & Kaiser International
Fund Group, Inc. and Bailard,
Biehl & Kaiser Fund Group and
Principal of BB&K Fund
Services, Inc.

CHANTAL GAIDDON                          5-13-56        1996              Vice President,
Vice President and                                                        Controller and
Controller of Fremont                                                     Treasurer
Investment Advisors, Inc.

</TABLE>

III.     OTHER BUSINESS

                  The proxy holders have no present intention of bringing any
matter before the meeting other than the proposals set forth herein. Neither
the proxy holders nor the Board of Directors are aware of any matters which
may be presented by others. If any other business shall properly come before
the meeting, the proxy holders intend to vote thereon in accordance with their
best judgment.

                  Any shareholder proposal intended to be presented at the
next shareholder meeting must be received by the Company for inclusion in its
proxy statement and form of proxy relating to such meeting at a reasonable
time before the solicitation of proxies for the meeting is made. The Company
does not hold regularly scheduled annual meetings of shareholders.

OUTSTANDING SHARES AND VOTING REQUIREMENTS

         The Board of Directors has fixed the close of business on January 13,
1997 as the record date for the determination of shareholders entitled to
notice of and to vote at the special meeting of shareholders or any
adjournment thereof. As of the record date,there were 443,865,523.129 shares
of common stock, $0.0001 par value, of the Company outstanding, including
3,421,828.361 shares of the Fremont International Growth Fund, 982,411.556
shares of the Fremont International Small Cap Fund and 7,312,071.916 shares of
the Fremont U.S. Micro-Cap Fund. All full shares of the Company are entitled
to one vote, with proportionate voting for fractional shares.

                                                      -12 -


<PAGE>



         On October 31, 1996, Fremont Investors, Inc. and its affiliated
companies including their employee retirement plans, its principal
shareholder, Stephen D. Bechtel, Jr., and members of his family, including
trusts, owned of record or beneficially the following approximate percentages
of the outstanding shares of the Funds:

                                                             % of Shares
                                                             Outstanding

      Fremont International Growth Fund                          84%
      Fremont International Small Cap Fund                       35%
      Fremont U.S. Micro-Cap Fund                                 6%

On January 13, 1997, the Advisor owned of record 10.6% of the outstanding
shares of the International Small Cap Fund; BF Fund Limited, 50 Fremont
Street, San Francisco, California 94105, owned of record 69.4% of the
outstanding shares of the Intrenational Growth Fund; The Northern Trust
Company as Trustee for The Fremont Group Retirement Plan, P.O. Box 92956,
Chicago, Illinois 60675, owned of record 7.3% of the outstanding shares of the
International Growth Fund; Charles Schwab & Co., Inc., 101 Montgomery Street,
San Francisco, California 94104, owned of record 44.5% of the outstanding
shares of the U.S. Micro-Cap Fund and 36.0% of the outstanding shares of the
International Small Cap Fund; Charles W. Lacy Rollover IRA Account, 22 Hans
Road, London, England, owned of record 5.0% of the outstanding shares of the
International Growth Fund; Donaldson, Lufkin & Jenrette Securities Company, 1
Pershing Plaza, Jersey City, New Jersey 07399, owned of record 8.1% of the
outstanding shares of the U.S. Micro-Cap Fund; Fremont Group L.L.C. Pension
Plan, 50 Fremont Street, San Francisco, California 94105, owned of record 8.4%
of the outstanding shares of the International Small Cap Fund; and Fremont
Investors, Inc. Pension Plan, 50 Fremont Street, San Francisco, California
94105, owned of record 11.9% of the outstanding shares of the International
Small Cap Fund. No other person owned of record and, according to information
available to the Funds, no other person owned beneficially, 5% or more of the
outstanding shares of any Fund on the record date.

         Approval of Proposal I requires the affirmative vote of a "majority
of the outstanding voting securities" of each Fund, as defined in the 1940
Act, which means the vote of two-thirds or more of the shares present at the
Meeting, if the holders of more than 50% of the outstanding shares are present
or represented by proxy, or the vote of more than 50% of the outstanding
shares, whichever is less. If a quorum (more than 50% of the outstanding
shares of the Company) is represented at the meeting, the vote of a plurality
of the Company's shares represented at the meeting is required for the
election of directors (Proposal II below). If a quorum is present at the
meeting but sufficient votes to approve one or more of the proposals described
herein is not received, the persons named as proxies may propose one or more
adjournments

                                                      -13 -


<PAGE>



of the meeting to permit further solicitation of proxies. Any such adjournment
will require the affirmative vote of a majority of those shares represented at
the meeting in person or by proxy. A shareholder vote may be taken on any
proposal in this proxy statement prior to any such adjournment if sufficient
votes have been received and it is otherwise appropriate. Abstentions and
"broker non-votes" are counted for purposes of determining whether a quorum is
present (and any vote for adjournment) but do not represent votes cast with
respect to a proposal. "Broker non-votes" are shares held by a broker or
nominee for which an executed proxy is received by the Company, but are not
voted as to one or more proposals because instructions have not been received
from the beneficial owners or persons entitled to vote and the broker or
nominee does not have discretionary voting power.

                                          By Order of the Board of Directors,

                                          /s/ Tina Thomas
                                          Tina Thomas
                                          Secretary

Date: January 20, 1997

- ----------------------------------------------------------------
Please complete, date and sign the enclosed Proxy and return it
promptly in the enclosed reply envelope.  NO POSTAGE IS REQUIRED
IF MAILED IN THE UNITED STATES.

                                                      -14 -


<PAGE>



                                   EXHIBIT A

                             AMENDED AND RESTATED
                              INVESTMENT ADVISORY
                                      AND
                       ADMINISTRATIVE SERVICES AGREEMENT

     THIS AGREEMENT, dated and effective as of the 1st day of February, 1994,
and amended as of this [ ] day of [ ], 1997 is made and entered into by and
between FREMONT MUTUAL FUNDS, INC., a Maryland corporation (hereinafter called
the "Company") and FREMONT INVESTMENT ADVISORS, INC. a California corporation
(hereinafter called the "Advisor").

     WHEREAS, the Company is engaged in business as an open-end management
investment company and is so registered under the Investment Company Act of
1940 (the "1940 Act"); and

     WHEREAS, the Advisor is engaged principally in the business of rendering
investment advisory and management services and is so registered under the
Investment Advisers Act of 1940 (the "Advisers Act"); and

     WHEREAS, the Company is authorized to, and does, issue shares of capital
stock in separate series with each such series representing interests in a
separate portfolio of securities and other assets; and

     WHEREAS, the Company intends to initially offer shares in one series to
be subject to this Agreement, the International Growth Fund (the "Initial
Series"), which together with all other series subsequently established by the
Company with respect to which the Company desires to retain the Advisor to
render investment advisory services hereunder and the Advisor is willing so to
do, being herein collectively referred to as the "Series" and individually
referred to as a "Series";

     NOW, THEREFORE, WITNESSETH: That it is hereby agreed between
the parties hereto as follows:

     1.  (a) INITIAL SERIES.  The Company hereby appoints the
Advisor to act as manager and investment adviser to the Initial
Series for the period and on the terms herein set forth.  The
Advisor accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.

         (b) ADDITIONAL SERIES. In the event that the Company establishes one
or more series of shares other than the Initial Series with respect to which
it desires to retain the Advisor to render management and investment advisory
services hereunder, it shall so notify the Advisor in writing, indicating the
advisory fee which will be payable with respect to the additional series of
shares. If the Advisor is willing to render such services, it shall so notify
the Company in writing, whereupon such series of shares shall become a Series
hereunder.

                                                      - A-1 -


<PAGE>



     The Advisor shall, for all purposes herein, be deemed an independent
contractor and not an agent of the Company.

     2. (a) The Advisor agrees to provide general management services to the
Company and each Series and, subject to review and approval by the Company's
Board of Directors, will (i) set the Series' overall investment strategies;
(ii) select Subadvisor(s); (iii) allocate and, when appropriate, reallocate a
Series' assets among the Advisor and one or more Subadvisors; (iv) monitor and
evaluate the performance of Subadvisors; and (v) seek to ensure that the
Subadvisors comply with the Series' investment objectives, policies and
restrictions, giving due consideration to the policies of each Series as
expressed in the Company's Articles of Incorporation, Bylaws, Form N-1A
Registration Statement under the 1940 Act and under the Securities Act of 1933
(the "1933 Act"), and prospectus as in use from time to time, as well as to
the factors affecting the status of each Series as a "regulated investment
company" under the Internal Revenue Code of 1986. In its duties hereunder, the
Advisor shall further be bound by any and all determinations by the Board of
Directors of the Company relating to investment policy, which determinations
shall in writing be communicated to the Advisor. Subject to the foregoing, the
Advisor will exercise all voting rights with respect to portfolio securities
and may delegate such voting rights to any Subadvisor approved by the Board of
Directors.

         (b) To the extent authorized by the Board of Directors of the
Company, the Advisor shall make decisions for each Series as to foreign
currency matters and make determinations as to, and execute and perform,
foreign exchange contracts or may delegate such decisions to any Subadvisor
approved by the Board of Directors.

         (c) (i) The Advisor shall provide adequate facilities and qualified
personnel for the placement of, and shall place orders for the purchase, or
other acquisition, and sale, or other disposition, of portfolio securities for
each Series. With respect to such transactions, the Advisor, subject to such
direction as may be furnished from time to time by the Board of Directors of
the Company, shall endeavor as the primary objective to obtain the most
favorable prices and executions of orders. Subject to such primary objective,
the Advisor may place orders with brokerage firms which furnish statistical
and other information to the Advisor, taking into account the value and
quality of the brokerage services of such brokerage firms, including the
availability and quality of such statistical and other information. Receipt by
the Advisor of any such statistical and other information and services shall
not be deemed to give rise to any requirement for abatement of the advisory
fee payable to the Advisor pursuant to Section 7 hereof.

                                                      - A-2 -


<PAGE>



              (ii) On occasions when the Advisor deems the purchase or sale of
a security to be in the best interests of a Series as well as other clients of
the Advisor, the Advisor, to the extent permitted by applicable laws and
regulations, may aggregate the securities to be so sold or purchased when the
Advisor believes that to do so will be in the best interests of the Series. In
such event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Advisor in the
manner the Advisor considers to be the most equitable and consistent with its
fiduciary obligations to the Series and to such other clients.

     3. Subject to prior approval of the Board of Directors, the Advisor may,
but is not required to, retain one or more investment management organizations
("Subadvisors") to make specific investment decisions with respect to all or a
portion of the assets of a particular Series. The Advisor may allocate
portions of a Series' assets among such Subadvisor(s) or among itself and such
Subadvisor(s). The Advisor shall monitor the performance of such
Subadvisor(s), shall allocate and reallocate assets among Subadvisors of
Series with multiple Subadvisors, and shall recommend the employment or
termination of a particular Subadvisor when deemed advisable. The Advisor will
compensate such Subadvisor(s) from its own resources, at no additional cost to
the Company.

     4. The Advisor shall furnish the services of persons to perform the
executive, administrative, clerical, and bookkeeping functions of the Company
(other than services involving the custody of portfolio securities), including
the daily determination of net asset value of each Series. The Advisor shall
also provide the Company with suitable office space (which may be in the
offices of the Advisor); all necessary small office equipment and utilities;
and general purpose accounting forms, supplies, and postage used at the
offices of the Company. These services are exclusive of the necessary services
and records of any dividend disbursing agent, transfer agent, registrar or
custodian, and accounting and bookkeeping services to be provided by the
custodian or other third-party service provider.

     5. The Advisor shall pay for all ordinary costs and expenses attendant to
operating the Series except: (i) the compensation payable hereunder to the
Advisor; (ii) taxes; (iii) interest expense; (iv) portfolio transaction costs,
including, e.g., brokerage commissions and underwriting discounts; and (v) any
extraordinary costs or expenses such as legal, accounting, or other costs or
expenses not incurred in the course of the regular and ongoing operations of
the Series. In each circumstance where the Advisor seeks to cause the Series
to bear certain costs and expenses as being extraordinary in nature, the
determination of a majority of the non-interested directors of the Company
shall be

                                                      - A-3 -


<PAGE>



binding upon the Advisor and the Company as to whether or not such costs and
expenses are "extraordinary" for these purposes. The Advisor shall pay the
fees and expense reimbursements due to third-party service providers which
provide services to the Series in the ordinary course of business, such as,
e.g., custodians, transfer agents, sub-transfer agents and Subadvisors.

     6. (a) Each Series shall pay to the Advisor on or before the tenth (10th)
day of each month, as compensation for the services rendered by the Advisor
during the preceding month, an amount to be computed by applying to the total
net asset value of such Series the applicable annual rates set forth on
Appendix A hereto.

         (b) The fees on Appendix A shall be computed and accrued daily at one
three-hundred-sixty-fifth (1/365th) or one three- hundred-sixty-sixth
(1/366th), as appropriate, of the applicable rates set forth therein. The net
asset value of each Series shall be determined in the manner set forth in the
Articles of Incorporation and applicable Prospectus of the Company after the
close of the New York Stock Exchange on each day on which said Exchange is
open, and in the case of Saturdays, Sundays, and other days on which said
exchange shall not be open, in the manner further set forth in said Articles
of Incorporation and Prospectus. In the event of termination other than at the
end of a calendar month, the monthly fee shall be prorated for the portion of
the month prior to termination and paid on or before the tenth (10th) day
subsequent to termination.

     7. (a) The Advisor agrees to reduce the fee payable to it under this
Agreement by the amount by which the ordinary operating expenses of the
Company for any fiscal year of the Company, excluding interest, taxes and
extraordinary expenses, shall exceed the most stringent limits prescribed by
any state in which the Company shares are offered for sale, based on the
average total net asset value of the Company determined pursuant to Section 6.
Costs incurred in connection with the purchase or sale of portfolio
securities, including brokerage fees and commissions, which are capitalized in
accordance with generally accepted accounting principles applicable to
investment companies, shall be accounted for as capital items and not as
expenses. Proper accruals shall be made by the Company for any projected
reduction hereunder and corresponding amounts shall be withheld from the fees
paid by the Company to the Advisor. Any additional reduction computed at the
end of the fiscal year shall be deducted from the fee for the last month of
such fiscal year.

         (b) The above provision in subsection (a) with respect to expense
limitation shall be calculated and administered separately with respect to
each Series, as opposed to the Company in the aggregate, if and to the extent
so required by state securities authorities.

                                                      - A-4 -


<PAGE>




     8. Nothing contained in this Agreement shall be construed to prohibit the
Advisor from performing investment advisory, management, or distribution
services for other investment companies and other persons or companies, or to
prohibit affiliates of the Advisor from engaging in such businesses or in
other related or unrelated businesses.

     9. The Company agrees (i) not to hold the Advisor or any of its officers,
directors, agents or employees liable for, and (ii) to indemnify or insure the
Advisor and its officers, directors, agents and employees ("Indemnified
Parties") against any and all losses, claims, damages, liabilities or
litigation (including legal and other expenses), to which the Indemnified
Parties may become subject under the 1933 Act, 1940 Act, the Advisers Act,
under any other statute, at common law or otherwise, which (1) arises out of
an investment decision or other action taken or omitted by one or more
Indemnified Parties in good faith exercise of authority hereunder or otherwise
related to this Agreement or (2) may be based upon any untrue statement or
alleged untrue statement of a material fact contained in a registration
statement or prospectus covering the shares of the Company or any Series or
any amendment thereof or any supplement thereto or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, if such a statement
or omission was made in reliance upon information furnished to the Indemnified
Parties; provided, however, that in no case is Company's indemnity in favor of
Indemnified Parties deemed to protect such Indemnified Parties against any
liability to which any such Indemnified Parties would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the
performance of his duties or by reason of his reckless disregard of
obligations and duties under this Agreement.

     10. (a) This Agreement shall become effective with respect to the Initial
Series on the date hereof (the "Effective Date") and, with respect to any
additional Series, on the date of receipt by the Company of notice from the
Advisor in accordance with Section 1(b) hereof that the Advisor is willing to
serve as Advisor with respect to such Series. Unless terminated as herein
provided, this Agreement shall remain in full force and effect for two (2)
years from the Effective Date with respect to the Initial Series and, with
respect to each additional Series, until the anniversary of the Effective Date
following the first anniversary of the date on which such Series becomes a
Series hereunder, and shall continue in full force and effect for periods of
one year thereafter with respect to each Series so long as such continuance
with respect to any such Series is approved at least annually (i) by either
the Directors of the Company or by a vote of a majority (as defined in the
1940 Act) of the outstanding voting securities of such Series, and (ii) in

                                                      - A-5 -


<PAGE>



either event by the vote of a majority of the Directors of the Company who are
not parties to this Agreement or "interested persons" (as defined in the 1940
Act) of any such party, cast in person at a meeting called for the purpose of
voting on such approval.

         (b)     This Agreement may be terminated with respect to any Series at
any time, without payment of any penalty, by the Board of Directors of the
Company or by the vote of a majority (as defined in the 1940 Act) of the
outstanding voting securities of the Company, on thirty (30) days' written
notice to the Advisor, or by the Advisor on like notice to the Company.

         (c)      This Agreement shall automatically and immediately
terminate in the event of its assignment.

         (d) This Agreement shall be governed by the laws of the State of
California, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Advisers Act or rules or orders of the SEC
thereunder.

         (e) No provision of this Agreement may be changed, waived, discharged
or terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought and no amendment of this Agreement shall be effective until approved by
a vote of a majority of the outstanding voting securities of the Series, if
such approval is required by applicable law.

     11. (a)      This Agreement supersedes any prior agreement
relating to the subject matter hereof between the parties.

         (b)      If any provision of this Agreement shall be held or made 
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate originals by their officers thereunto duly authorized as
of the date first above written.

FREMONT MUTUAL FUNDS, INC.                   FREMONT INVESTMENT ADVISORS, INC.

By:_______________________                   By:______________________________
   David L. Redo, Chairman                      David L. Redo, President

ATTEST:                                       ATTEST:

  ________________________                      ______________________________
  Tina Thomas, Secretary                        Tina Thomas, Secretary

                                    - A-6 -


<PAGE>





                          EFFECTIVE NOVEMBER 1, 1996

                                  APPENDIX A
                            to Investment Advisory
                     and Administrative Services Agreement

<TABLE>
<CAPTION>

   On the Portion of
Daily Total Net Asset Value                                      Annual Rate
- ---------------------------                                      -----------
<S>                                                              <C>
International Growth Fund                                            1.50%

International Small Cap Fund                                         1.50%

U.S. Micro-Cap Fund

     First $30 million                                               2.50%
     Next $70 million                                                2.00%
     In excess of $100 million                                       1.50%

                                    - A-7 -
</TABLE>


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