FREMONT MUTUAL FUNDS
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Supplement dated January 20, 1999 to Prospectus dated March 1, 1998
(as amended June 29, 1998)
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FREMONT SELECT FUND
The Fremont Select Fund is expected to be reorganized into the Fremont
Global Fund during the second quarter of 1999. Following the reorganization,
shareholders of the Select Fund would become shareholders of the Global Fund.
The Select Fund would then cease operations. The reorganization is subject to
the approval by the shareholders of the Select Fund. Proxy materials containing
detailed information and seeking approval of the reorganization will be sent to
those shareholders. The Select Fund is no longer accepting new investments.
Effective January 4, 1999, the Advisor's U.S. Equity Committee assumed full
responsibility for managing this Fund. The chairman of the U.S. Equity Committee
is Peter F. Landini. For a discussion of the business experience of Mr. Landini,
please refer to the section of the Prospectus concerning the Advisor and the
Global Fund (page 13).
As of August 1, 1998, the following changes have been made to the
management structure within Fremont Investment Advisors, Inc. (the "Advisor"):
FREMONT GLOBAL FUND
Peter F. Landini has passed the Chairmanship of the Fremont Asset
Allocation Committee, which oversees the management of the Fremont Global Fund,
onto Albert W. Kirschbaum. Mr. Landini will remain on the committee as a member.
FREMONT GROWTH FUND
The Fremont Growth Fund's objective has not changed. The Advisor has
developed a new strategy to achieve the Fund's objective, which is to provide
growth of capital over the long term. The securities in the Fund's portfolio are
selected mainly from a universe of the 2,000 largest publicly traded U.S.
corporations. Central to the strategy is the use of a computer model that
emphasizes stocks with characteristics which are believed to enhance total
return. These characteristics include above average expectations for future
earnings and reasonable pricing.
The portfolio management team for the Fremont Growth Fund will be led by W.
Kent Copa and will include Debra L. McNeill and Peter F. Landini.
FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND
The Board of Directors of Fremont Mutual Funds, Inc. has approved a new
sub-advisor for the Fremont California Intermediate Tax-Free Fund. The new
sub-advisor is Rayner Associates, Inc. ("Rayner"), located at 655 Redwood Hwy.,
Suite 370, Mill Valley, California.
Rayner is an independent, California-registered investment advisor founded
in 1977. Its principal business is providing investment management services,
managing over $200 million in investment securities and administering over 130
institutional and individual accounts. The firm's principal executive officers
are Arno A. Rayner, president, and William C. Williams, vice president. Mr.
Rayner and Mr. Williams have been with Rayner since inception, and September
1989, respectively.
(over)
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FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND (Cont.)
Rayner concentrates on acquiring investment grade municipal bonds that are
attractively priced. To enhance returns, they analyze changes in the yield
curve, identify bonds that may be upgraded by the rating agencies and watch for
undervalued sectors in the market.
As compensation for its services, the Advisor (not the Fund) pays the
Sub-Advisor an annual fee equal to 0.20% of the Fund's average daily net assets
managed by the Sub-Advisor. The Advisor reserves day-to-day authority to
increase or decrease the amount of Fund's assets managed by Rayner.
OTHER CHANGES
As of June 22, 1998, Investors Fiduciary Trust Company ("IFTC"), 801
Pennsylvania, Kansas City, Missouri, 64105, is the new custodian for Fremont
Mutual Funds, Inc.
National Financial Data Services ("NFDS") has moved to a new location.
Their street address is now 330 W. 9th Street, Kansas City, Missouri, 64105. The
P.O. Box address listed on the "Telephone Numbers and Addresses" page of the
Prospectus is still in effect for transactions by mail.
NFDS had served as the Funds' Transfer Agent through a sub-delegation from
Fremont Investment Advisors, Inc. by way of State Street Bank and Trust Company.
Effective October 5, 1998, NFDS serves as the Funds' Transfer Agent directly.
This change in status will not affect any of the procedures currently in place
relating to purchases, redemptions, exchanges, shareholder communications or
other shareholder services.
Fremont Mutual Funds, Inc. and the Advisor have received from the
Securities and Exchange Commission an order (the "SEC Order") exempting the
Funds in the future from the provisions of the 1940 Act that require the
shareholders of the Funds to approve the Funds' sub-advisory agreement(s) and
any amendments thereto. The SEC Order permits the Advisor to hire new
sub-advisors, terminate sub-advisors, rehire existing sub-advisors whose
agreements have been assigned (and, thus, automatically terminated), and modify
sub-advisory agreements without the prior approval of shareholders. By
eliminating shareholder approval in these matters, the Advisor will have greater
flexibility in managing sub-advisors, and shareholders will save the
considerable expense involved in holding shareholder meetings and soliciting
proxies. The Advisor may in its discretion manage all or a portion of the Funds'
portfolios with or without the use of sub-advisors.
P042-9901
