INDEPENDENCE ONE MUTUAL FUNDS, DEF 14A, 1995-06-14

INDEPENDENCE ONE MUTUAL FUNDS
DEF 14A, 1995-06-14

Previous: GREENSTONE ROBERTS ADVERTISING INC, 10-Q, 1995-06-14

Next: NUVEEN PERFORMANCE PLUS MUNICIPAL FUND INC, DEF 14A, 1995-06-14

INDEPENDENCE ONE MUTUAL FUNDS

INDEPENDENCE ONE MICHIGAN MUNICIPAL CASH FUND
INDEPENDENCE ONE PRIME MONEY MARKET FUND
INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND
INDEPENDENCE ONE U.S. TREASURY MONEY MARKET FUND

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD JULY 31, 1995

A special meeting of the shareholders of Independence One Mutual Funds (the
"Trust"), which consists of Independence One Michigan Municipal Cash Fund,
Independence One Prime Money Market Fund, Independence One U.S. Government
Securities Fund, and Independence One U.S. Treasury Money Market Fund
(individually referred to as a "Fund" and collectively as the "Funds"), will be
held at the Trust's offices on the 19th Floor of Federated Investors Tower, 1001
Liberty Avenue, Pittsburgh, Pennsylvania 15222-3779 at 2:00 p.m on July 31,
1995. The table that follows summarizes the purposes for the special meeting of
shareholders:

ALL FUNDS:

(1) To elect one Trustee;*

(2) To approve or disapprove a new Investment Advisory Contract between
Michigan National Bank (the "Present Adviser") and the Trust, on behalf
of Independence One Michigan Municipal Cash Fund, Independence One Prime
Money Market Fund, Independence One U.S. Government Securities Fund, and
Independence One U.S. Treasury Money Market Fund;** and

(3) To transact such other business as may properly come before the meeting
or any adjournment thereof.

INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND ONLY:

(1) To Approve or Disapprove a new Sub-Advisory Agreement between
Independence One Capital Management Corporation (the "Present
Sub-Adviser") and Michigan National Bank, on behalf of Independence One
U.S. Government Securities Fund.

* Shares of all the Funds comprising the Trust will vote as a single group
on this item. Election of a Trustee requires the affirmative vote of a
plurality of the votes cast at the special meeting.

** Each Fund votes separately on this item.

The Trustees have fixed June 5, 1995 as the record date for determination of
shareholders entitled to vote as this special meeting.

By Order of the Trustees

JAY S. NEUMAN
Secretary

June 16, 1995

SIGN, DATE, AND RETURN THE ENCLOSED PROXY
PROMPTLY TO AVOID ADDITIONAL EXPENSE

YOU CAN HELP THE TRUST AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP
LETTERS TO ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU ARE
UNABLE TO ATTEND THE MEETING, PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED
PROXY SO THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE SPECIAL MEETING.
THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.

INDEPENDENCE ONE MUTUAL FUNDS
INDEPENDENCE ONE MICHIGAN MUNICIPAL CASH FUND
INDEPENDENCE ONE PRIME MONEY MARKET FUND
INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND
INDEPENDENCE ONE U.S. TREASURY MONEY MARKET FUND

19TH FLOOR, FEDERATED INVESTORS TOWER
PITTSBURGH, PENNSYLVANIA 15222-3779

PROXY STATEMENT

The enclosed proxy is solicited on behalf of the Board of Trustees of the
Trust. The proxy is revocable at any time before it is voted by sending written
notice of the revocation to the Trust or by appearing personally at the July 31,
1995 special meeting of shareholders ("Special Meeting"). The cost of preparing
and mailing the notice of meeting, the proxy cards, this Proxy Statement and any
additional proxy material has been or is to be borne by Michigan National Bank,
the Funds' "Present Adviser." Proxy solicitations will be made primarily by
mail, but may also be made by telephone, telegraph, or personal interview
conducted by certain officers or employees of the Trust or of Federated Services
Company (the Trust's transfer agent) or Federated Administrative Services (the
Trust's administrator). In the event that the shareholder signs and returns the
proxy ballot but does not indicate a choice as to any of the items on the proxy
ballot, the proxy attorneys will vote those shares in favor of such proposal(s).

On June 5, 1995, the Trust had outstanding 544,073,517.84 shares of
beneficial interest, each share being entitled to one vote and fractional shares
being entitled to proportionate fractional votes. Total outstanding shares of
the Funds were as follows: 67,706,799.32 shares of Independence One Michigan
Municipal Cash Fund; 249,149,669.83 shares of Independence One Prime Money
Market Fund; 6,340,425.42 shares of Independence One U.S. Government Securities
Fund; and 220,876,623.27 shares of Independence One U.S. Treasury Money Market
Fund. Only shareholders of record at the close of business on June 5, 1995 will
be entitled to notice of and to vote at the Special Meeting. With respect to
each matter to be considered at the Special Meeting, more than fifty percent of
the total number of outstanding shares entitled to vote on the matter,
represented in person or by proxy, shall be required to constitute a quorum at
the Special Meeting for the purpose of voting on the matter.

For purposes of determining the presence of a quorum and counting votes on
the matters presented, shares represented by abstentions and "broker non-votes"
will be counted as present, but not as votes cast, at the Special Meeting. Under
the Trust's Declaration of Trust, the election of a Trustee will be determined
by a plurality of the votes cast at the Special Meeting. Under the Investment
Company Act of 1940 (the "1940 Act"), the affirmative vote necessary to approve
other matters may be determined with reference to a percentage of votes present
at the Special Meeting, which would have the effect of treating abstentions and
non-votes as if they were votes against the proposal. Specifically, approval of
the new investment advisory contract and new sub-advisory agreement requires the
affirmative vote, with respect to each Fund entitled to vote on the matter, of:
(a) 67% or more of the shares of a Fund present at the Special Meeting, if the
holders of more than 50% of the outstanding shares of that Fund are present or
represented by proxy; or (b) more than 50% of the outstanding shares of a Fund,
whichever is less.

A Fund will furnish, without charge, a copy of its annual report and most
recent semi-annual report succeeding the annual report, if any, to any
shareholder of record upon request. To request an annual and/or semi-annual
report call 1-800-235-4669, or send a written request to Betsy Hamilton at
Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, Pennsylvania
15222-3779. The Trust's executive offices are located at Federated Investors
Tower, 1001 Liberty Avenue, Pittsburgh, Pennsylvania 15222-3779. This Proxy
Statement and the enclosed notice of meeting and proxy card are first being
mailed on or about June 16, 1995.

INTRODUCTION

A Special Meeting is being called to approve or disapprove a new investment
advisory contract between the Trust, on behalf of Independence One Michigan
Municipal Cash Fund, Independence One Prime Money Market Fund, Independence One
U.S. Government Securities Fund, and Independence One U.S. Treasury Money Market
Fund, and Michigan National Bank, as a subsidiary of National Australia Bank
Limited (the "New Adviser"), and to vote on the election of one Trustee. In
addition, shareholders of Independence One U.S. Government Securities Fund will
be asked to approve or disapprove a new sub-advisory agreement between Michigan
National Bank and Independence One Capital Management Corporation, as a
subsidiary of National Australia Bank Limited (the "New Sub-Adviser").

Consideration of the new investment advisory contract and new sub-advisory
agreement has been made necessary by the pending acquisition by National
Australia Bank Limited ("NAB") of Michigan National Corporation, of which the
Present Adviser and Present Sub-Adviser are wholly-owned subsidiaries. The Board
of Trustees proposes that the new investment advisory contract and the new
sub-advisory agreement take effect on or about the date the acquisition is
consummated. At that time, the existing investment advisory contract and
sub-advisory agreement will automatically terminate in accordance with their
terms as required by the 1940 Act.

Here are some of the factors you should consider in determining whether to
approve the new investment advisory contract (and with respect to Independence
One U.S. Government Securities Fund, the new sub-advisory agreement):

- your Board of Trustees has unanimously approved the new investment
advisory contract (and the new sub-advisory agreement);

- no change in any Fund's investment objective or investment policies will
take place;

- there will be no change in the fees payable by a Fund for advisory (or
sub-advisory) services;

- the Trustees of the Trust, all of whom are familiar with mutual funds and
the existing relationship between each Fund and the Present Adviser (and
Independence One U.S. Government Securities Fund and the Present
Sub-Adviser), will remain unchanged; and

- the New Adviser (and the New Sub-Adviser) are experienced in providing
investment advice of the type necessary to carry out each Fund's
investment program.

ELECTION OF ONE TRUSTEE
(APPLIES TO ALL FUNDS)

At the meeting, shareholder votes will be taken on the election of Thomas
S. Wilson as a Trustee of the Trust to hold office until the election and
qualification of his successor. Mr. Wilson was appointed Trustee on December 7,
1993 to expand the size of the Board. He is currently serving as a Trustee and
has consented to continue to serve if elected. Shares of all the Funds
comprising the Trust will be voted as a single group on the election of the
Trustee. Election of a Trustee requires the affirmative vote of a plurality of
the votes cast at the Special Meeting.

TRUSTEES OF THE TRUST

When elected, a Trustee will hold office during the lifetime of the Trust
except that: (a) any Trustee may resign; (b) any Trustee may be removed by
written instrument signed by at least two-thirds of the number of Trustees prior
to such removal; (c) any Trustee who requests to be retired or who has become
mentally or physically incapacitated may be retired by written instrument signed
by a majority of the other Trustees; and (d) a Trustee may be removed at any
special meeting of the Trust's shareholders by a vote of two-thirds of the
outstanding shares of the Trust. In case a vacancy shall exist for any reason,
the remaining Trustees will fill such vacancy by appointment of another Trustee.
The Trustees will not fill any vacancy by appointment if immediately after
filling such vacancy, less than two-thirds of the Trustees then holding office
would have been elected by the

shareholders. If, at any time, less than a majority of the Trustees holding
office have been elected by the shareholders, the Trustees then in office will
call a shareholders' meeting for the purpose of electing Trustees to fill
vacancies. Otherwise, there will normally be no meeting of shareholders called
for the purpose of electing Trustees. The following is a complete list of
persons currently serving as Trustees of the Trust. Only Thomas S. Wilson is
standing for election at this time.

TRUSTEE STANDING FOR ELECTION:
- --------------------------------------------------------------------------------
Thomas S. Wilson
Birthdate: October 9, 1949
Date Elected: December 7, 1993

Trustee

President, and Executive Administrator of the Detroit Pistons; President, Arena
Associates, Inc. Two Championship Drive, Auburn Hills, MI.

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

ADDITIONAL TRUSTEES OF THE TRUST:
- --------------------------------------------------------------------------------
Robert E. Baker
Birthdate: May 6, 1930
Date Elected: July 27, 1990

Trustee

Retired; formerly, Vice Chairman, Chrysler Financial Corporation. 4327
Stoneleigh Road, Bloomfield Hills, MI.
- --------------------------------------------------------------------------------
Harold Berry
Birthdate: September 17, 1925
Date Elected: April 14, 1989

Trustee

Managing Partner, Berry Enterprises; Chairman, Independent Sprinkler Companies
Inc., formerly Chairman, Executive Committee, Federal Enterprises, Inc.;
Chairman, Berry, Ziegelman & Company; 100 Galleria Officentre, Suite 219,
Southfiled, MI.
- --------------------------------------------------------------------------------
Clarence G. Frame+
Birthdate: July 26, 1918
Date Elected: April 14, 1989

Trustee

Director, Tosco Corporation, Chicago Milwaukee Corporation, and Voyageur Funds
Group; formerly, Vice Chairman, First Bank System, Inc., and President, The
First National Bank of St. Paul, a subsidiary of First Bank System, Inc. W-875
First Bank Building, 322 Minnesota Street, St. Paul, MN.
- --------------------------------------------------------------------------------
Harry J. Nederlander+*
Birthdate: September 5, 1917
Date Elected: April 14, 1989

Trustee

Chairman, Nederlander Enterprises. 231 S. Woodward, Suite 219, Birmingham, MI.
- --------------------------------------------------------------------------------

NOTES: + Members of the Executive Committee of the Board of Trustees.

* Deemed to be an "interested person" of the Trust under the
Investment Company Act of 1940, by virtue of his ownership of
stock in Michigan National Corporation.

TRUSTEES' COMPENSATION
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
AGGREGATE COMPENSATION FROM
NAME, POSITION WITH TRUST TRUST+
<S> <C>
---------------------------------------------------------------------
Robert E. Baker
Trustee $8,500
Harold Berry
Trustee $8,500
Clarence G. Frame
Trustee $8,500
Harry J. Nederlander
Trustee $8,500
Thomas S. Wilson
Trustee $7,650
</TABLE>

+ The aggregate compensation is provided for the Trust which is comprised of
four portfolios. The Trust is the only investment company in the fund complex.
Information is furnished for the fiscal year ended April 30, 1995.

If the nominee for election as a Trustee named above shall by reason of
death or for any other reason become unavailable as a candidate at the Special
Meeting, votes pursuant to the enclosed proxies will be cast for a substitute
candidate by the attorneys named therein, or their substitutes, present and
acting at the Special Meeting. Any such substitute candidate for election as a
Trustee who is an "interested person" shall be nominated by the Executive
Committee of the Board of Trustees. The selection of any substitute candidate
for election as a Trustee who is not an interested person shall be made by a
majority of the Trustees who are not interested persons of the Trust (the
"Independent Trustees"). The Board of Trustees has no reason to believe that the
nominee will become unavailable for election as a Trustee.

During the fiscal year ended April 30, 1995, there were four meetings of
the Board of Trustees. All of the Trustees attended at least 75% of the
meetings. The Trustees as a group received fees totaling $48,762 (which includes
reimbursement for expenses for attendance at the meetings).

Officers and Trustees as a group own less than 1% of the Trust's
outstanding shares.

In addition to its Executive Committee which handles the Board's
responsibilities between meetings of the Board of Trustees, the Trust has an
Audit Committee. Generally, the function of the Audit Committee is to assist the
Board in fulfilling its duties relating to the Trust's accounting and financial
reporting practices and to serve as a direct line of communication between the
Board and the independent auditors. The specific functions of the Audit
Committee include recommending the engagement or retention of the independent
auditors, reviewing with the independent auditors the plan and the results of
the auditing engagement, approving professional services provided by the
independent auditors prior to the performance of such services, considering the
range of audit and non-audit fees, reviewing the independence of the independent
auditors, reviewing the scope and results of the Trust's procedures for internal
auditing, and reviewing the Trust's system of internal accounting controls.

Messrs. Baker, Berry, and Frame, all of whom are Independent Trustees,
serve on the Audit Committee. During the fiscal year ended April 30, 1995, there
was one meeting of the Audit Committee. All of the members of the Audit
Committee were present at the meeting.

The executive officers of the Trust are elected annually by the Board of
Trustees. Each officer holds the office until the election and qualification of
his successor. The names and ages (in parentheses) of the executive officers of
the Trust and their principal occupations during the last five years are as
follows: Edward C. Gonzales (64), Vice President and Treasurer of the Trust, is
Vice President, Treasurer and Trustee, Federated Investors; Vice President and
Treasurer, Federated Advisers, Federated Management, and Federated Research;
Executive Vice President, Treasurer and Director, Feder-

ated Securities Corp.; Chairman, Treasurer, and Trustee, Federated
Administrative Services; Jeffrey W. Sterling (48), Vice President and Assistant
Treasurer of the Trust, is Vice President, Federated Administrative Services;
and Jay S. Neuman (45), Secretary of the Trust, is also Corporate Counsel,
Federated Investors. Mr. Gonzales has been an executive officer of the Trust
since April 17, 1989, and Mr. Sterling and Mr. Neuman have been executive
officers of the Trust since June 26, 1989 and December 9, 1991, respectively.

Federated Administrative Services, the Trust's administrator, and Federated
Securities Corp., the principal underwriter for the Trust, are both wholly-owned
subsidiaries of Federated Investors. Their address is Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779.

APPROVAL OR DISAPPROVAL OF A NEW INVESTMENT ADVISORY
CONTRACT ("NEW ADVISORY CONTRACT")
(APPLIES TO ALL FUNDS)

Michigan National Bank serves as investment adviser to each Fund pursuant
to an investment advisory contract effective June 1, 1989 for Independence One
Prime Money Market Fund, Independence One U.S. Treasury Money Market Fund, and
Independence One Michigan Municipal Cash Fund, and October 31, 1992 for
Independence One U.S. Government Securities Fund (collectively referred to as
the "Present Advisory Contract"). The Present Adviser is a wholly-owned
subsidiary of Michigan National Corporation, a bank holding company. The address
of both Michigan National Corporation and Michigan National Bank is 27777
Inkster Road, Farmington Hills, Michigan.

On February 4, 1995, Michigan National Corporation and NAB signed a
definitive Agreement and Plan of Merger ("Merger Agreement"). See "Proposed
Merger of Michigan National Corporation." Consummation of the transaction
contemplated by the Merger Agreement (the "Merger") will cause the Present
Adviser to become an indirect wholly-owned subsidiary of NAB. This change in
ownership of the Present Adviser will automatically terminate the Present
Advisory Contract in accordance with its terms as required by the 1940 Act.
Thus, although immediately following the Merger, Michigan National Bank would
remain the entity responsible for providing investment advisory services to each
Fund, this change in ownership requires approval by the shareholders of each
Fund of the New Advisory Contract.

On May 4, 1995, the Trustees, including a majority of the Independent
Trustees, approved the New Advisory Contract with Michigan National Bank to act
as each Fund's investment adviser. The terms of the New Advisory Contract are
identical in all material respects to the Present Advisory Contract, except for
the effective date which, in the case of the New Advisory Contract, will be the
date of the consummation of the Merger (the "Closing Date"). It is currently
expected that the Closing Date will occur during the third or fourth quarter of
1995. The proposed New Advisory Contract is attached as Appendix A to this Proxy
Statement.

On April 17, 1989, at the request of the Present Adviser, the Present
Advisory Contract was approved by the Board of Trustees, including the majority
of the Independent Trustees, on behalf of Independence One Michigan Municipal
Cash Fund, Independence One Prime Money Market Fund, and Independence One U.S.
Treasury Money Market Fund, and was recommended by the Trustees for shareholder
approval. The shareholders of each of these Funds approved the Present Advisory
Contract at a special meeting of shareholders on September 24, 1990. Similarly,
on September 26, 1991, at the request of the Present Adviser, the Present
Advisory Contract was approved by the Board of Trustees, including the majority
of the Independent Trustees, on behalf of Independence One U.S. Government
Securities Fund, and was recommended by the Trustees for shareholder approval.
The initial shareholder of Independence One U.S. Government Securities Fund,
Federated Administrative Services, approved the Present Advisory Contract on
October 31, 1992. On March 7, 1995, the Present Advisory Contract was renewed
for one year by a majority vote of the Trustees, including a majority of the
Independent Trustees, cast in person at a meeting called for that purpose, on
behalf of Independence One Michigan Municipal Cash Fund, Independence One Prime
Money Market Fund, Independence One U.S. Treasury Money Market Fund, and
Independence One U.S. Government Securities Fund.

Under the terms of the Present Advisory Contract, subject to the direction
of the Board of Trustees, the Present Adviser provides investment research,
advice, management, and supervision of the investments of each Fund and conducts
a continuous program of investment evaluation and of appropriate sale or other
disposition and reinvestment of each Fund's assets. For its services, the
Present Adviser is entitled to receive an annual investment advisory fee from
each Fund as follows:

<TABLE>

<CAPTION>
.40 OF 1% OF AVERAGE DAILY NET ASSETS OF: NET ASSETS AS OF APRIL 30, 1995
----------------------------------------- ----------------------------------

<S> <C>
Independence One Michigan Municipal Cash Fund $66,856,403
Independence One Prime Money Market Fund $233,606,848
Independence One U.S. Treasury Money Market Fund $244,887,189

.70 OF 1% OF AVERAGE DAILY NET ASSETS OF:
Independence One U.S. Government Securities Fund $62,514,143
</TABLE>

The Present Advisory Contract provides that each Fund shall pay all of its
own expenses and its allocable share of Trust expenses. These expenses include
expenses of administrative personnel and services provided to the Trust by
Federated Administrative Services at an annual rate as described in each Fund's
prospectus. However, the Present Advisory Contract also provides that the
Present Adviser may, from time to time, and for such periods as its deems
appropriate, reduce its compensation by voluntarily limiting the expenses of a
Fund. For the fiscal year ended April 30, 1995 the Present Adviser earned the
following investment advisory fees:

<TABLE>
<C> <S>
$ 248,836 Independence One Michigan Municipal Cash Fund;
$1,066,096 Independence One Prime Money Market Fund;
$ 983,049 Independence One U.S. Treasury Money Market Fund;
$ 458,170 Independence One U.S. Government Securities Fund;
</TABLE>

and waived advisory fees in the amount of $128,411, $0, $0 and $458,170,
respectively.

If approved by shareholders at this Special Meeting, the New Advisory
Contract will continue for two years after it takes effect, unless terminated,
and may be continued from year to year thereafter by the Board of Trustees. The
continuation of the New Advisory Contract must be approved by a majority vote of
the Trustees, including a majority of the Independent Trustees, cast in person
at a meeting called for that purpose. The New Adviser has the right, in any
year, to notify the Trust in writing at least 60 days before the New Advisory
Contract anniversary date, that it does not desire a renewal of the New Advisory
Contract. The Trustees, or a majority of the outstanding voting shares of a
Fund, may terminate the New Advisory Contract with respect to that Fund at any
time without penalty by giving the New Adviser 60 days' written notice. The New
Advisory Contract may not be assigned and shall terminate automatically in the
event of any assignment as defined in the 1940 Act. The New Advisory Contract
provides that it may be amended with respect to a Fund by a vote of both a
majority of the Trustees, including a majority of the Independent Trustees, and
by the holders of a majority of the outstanding voting shares of that Fund.

As is the case with the Present Advisory Contract, the New Advisory
Contract provides that in the absence of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the obligations or duties of the New
Adviser under the New Advisory Contract, the New Adviser shall not be liable to
a Fund, the Trust, or to any shareholder for any act or omission in the course
of, or connected in any way with, rendering services or for any losses that may
be sustained in the purchase, holding, or sale of any security.

The Trustees of the Trust, including the Independent Trustees, reviewed and
unanimously approved the New Advisory Contract on behalf of each Fund and
directed that it be submitted to shareholders for their approval.

If the New Advisory Contract is approved by shareholders of a Fund and the
Merger is consummated, the New Advisory Contract will be executed and become
effective on the Closing Date. In the event the Merger is not consummated, the
Present Advisory Contract will continue in accordance with its terms. If the
Merger is consummated and if the New Advisory Contract is not approved by the

shareholders of a Fund, the Present Advisory Contract will terminate and the
Board of Trustees will consider what actions should be taken, including but not
limited to requesting that the Present Adviser perform investment advisory
services for that Fund at cost until a new investment advisory contract is
approved by the shareholders.

Shareholders of the Funds are not being asked to vote on the Merger.

PROPOSED MERGER OF MICHIGAN NATIONAL CORPORATION

The terms of the Merger Agreement provide that, upon consummation of the
Merger of Michigan National Corporation with and into NAB, each outstanding
share of Michigan National Corporation common stock will be converted into the
right to receive $110.

According to representatives of Michigan National Corporation, after
careful review and consideration, Michigan National Corporation's Board of
Directors determined that the terms of the Merger were fair to, and in the best
interests of, Michigan National Corporation and its stockholders. The Trust was
informed that Michigan National Corporation's Board believes that the Merger
will provide significant value to all of its stockholders. Information
concerning NAB's operations and history is presented later in this Proxy
Statement.

Consummation of the Merger is subject to the satisfaction of certain
conditions including, among others, the receipt of all necessary regulatory
approvals. At a meeting held on June 2, 1995, the shareholders of Michigan
National Corporation approved the Merger Agreement. The Merger Agreement may be
terminated and the Merger abandoned at any time prior to the Closing Date by the
mutual consent of Michigan National Corporation and NAB or upon the occurrence
of other events specified in the Merger Agreement. Completion of the Merger will
occur as soon as practicable after satisfaction or waiver of the applicable
conditions, which the parties anticipate will occur during the third or fourth
quarter of 1995.

TRUSTEES' RECOMMENDATIONS AND OTHER INFORMATION

The New Advisory Contract was unanimously approved on behalf of each Fund
by the Board of Trustees of the Trust, including the Independent Trustees, at a
meeting held on May 4, 1995. By approving the New Advisory Contract, the
Trustees have acted in what they believe to be the best interest of the
shareholders of each Fund. The Trustees considered information relating to the
Present Adviser, NAB, and the consolidated entity that would result from the
completion of the Merger, including present capabilities and expertise in
serving as investment adviser to the Funds. They reviewed the terms of the New
Advisory Contract, including the fact that no change to any Fund's advisory fee
is being proposed. It was also noted that the New Adviser would continue to be
familiar with the Funds and their shareholder base.

Specifically in connection with approval of the New Advisory Contract on
behalf of each Fund, the Board considered that the terms of the Merger do not
require any change in the Funds' investment objectives or policies, Michigan
National Bank's investment management or operation of the Funds, the investment
personnel managing the Funds, or the stockholder services or other business
activities of the Funds. Michigan National Bank has informed the Board that the
Merger is not expected to result in any such change, although no assurance can
be given that such a change will not occur. Michigan National Bank also has
advised that, at present, it is not aware of plans or proposals to make any
material changes in the business, corporate structure or composition of senior
management or personnel of Michigan National Bank, or in the manner in which it
renders investment advisory services to each Fund. If, after the Merger, changes
in Michigan National Bank are proposed that might materially affect its services
to a Fund, the Fund's Board will consider the effect of those changes and take
such action as it deems advisable under the circumstances.

In light of these representations, in approving the New Advisory Contract,
the Board placed particular emphasis on Michigan National Bank's record of
service to the Funds and the expectation that the Merger should not have any
material adverse effect on the Funds' ongoing operations or on the

extent or quality of services provided by Michigan National Bank to the Funds,
or increase the cost to the Funds of such services. It is noted in this regard
that, as part of its ongoing responsibilities, the Board throughout the years
has monitored the Funds' performance, as well as the manner in which Michigan
National Bank has carried out its duties as investment adviser.

The 1940 Act provides that in connection with the sale of any interest in
any investment adviser which results in the "assignment" of any investment
advisory agreement, an investment adviser of a registered investment company
such as the Funds, or an affiliated person of such adviser, may receive any
amount or benefit if (i) for a period of three years after the sale, at least
75% of the members of the Board of Trustees of the investment company are not
interested persons of the adviser or the predecessor adviser, and (ii) there is
no "unfair burden" imposed on the investment company as a result of such sale or
any express or implied terms, conditions or understanding applicable thereto.
For this purpose, "unfair burden" is defined to include any arrangement during
the two-year period after the transaction, whereby the adviser or its
predecessor or successor advisers, or any interested persons of any such
adviser, receives or is entitled to receive any compensation directly or
indirectly (i) from any person in connection with the purchase or sale of
securities or other property to, from or on behalf of the investment company
other than bona fide ordinary compensation as principal underwriter for such
company, or (ii) from the investment company or its security holders for other
than bona fide advisory or other services. This provision of the 1940 Act was
enacted by Congress in 1975 to make it clear that an adviser (or an affiliated
person of the adviser) can realize a profit on the sale of the adviser's
business subject to the two safeguards described above. The Board of Trustees of
the Trust has requested and received assurances from Michigan National Bank and
NAB that no "unfair burden" will be imposed on the Trust or any of the Funds as
a result of the proposed transaction.

THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS THAT THE SHAREHOLDERS
OF EACH FUND APPROVE THE NEW INVESTMENT ADVISORY CONTRACT

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

APPROVAL OR DISAPPROVAL OF A NEW SUB-ADVISORY
AGREEMENT ("NEW SUB-ADVISORY AGREEMENT")
(APPLIES ONLY TO INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND)

Independence One Capital Management Corporation, 27777 Inkster Road,
Farmington Hills, Michigan, serves as sub-adviser to Independence One U.S.
Government Securities Fund pursuant to a sub-advisory agreement dated October
31, 1992 (the "Present Sub-Advisory Agreement"). The Present Sub-Adviser is a
nationally recognized investment advisory subsidiary of Michigan National
Corporation.

As indicated in the section entitled "Approval or Disapproval of New
Advisory Contract" in this Proxy Statement, on February 4, 1995, Michigan
National Corporation and NAB signed a Merger Agreement. See "Proposed Merger of
Michigan National Corporation." Consummation of the transaction contemplated by
the Merger will cause the Present Sub-Adviser to become an indirect wholly-owned
subsidiary of NAB. This change in ownership of the Present Sub-Adviser will
automatically terminate the Present Sub-Advisory Agreement in accordance with
its terms as required by the 1940 Act. Thus, although immediately following the
Merger, Independence One Capital Management Corporation would remain the entity
responsible for providing sub-advisory services to Independence One U.S.
Government Securities Fund, this change in ownership requires approval by the
shareholders of Independence One U.S. Government Securities Fund of the New
Sub-Advisory Agreement.

On May 4, 1995, the Trustees, including a majority of the Independent
Trustees, approved the New Sub-Advisory Agreement with Independence One Capital
Management Corporation to act as Independence One U.S. Government Securities
Fund's sub-adviser. The terms of the New Sub-Advisory Agreement are identical in
all material respects to the Present Sub-Advisory Agreement, except for the
effective date which, in the case of the New Sub-Advisory Agreement, will be the
Closing Date. As indicated in the section entitled "Approval or Disapproval of
New Advisory Contract" of this Proxy

Statement, it is currently expected that the Closing Date will occur during the
third or fourth quarter of 1995.

A copy of the New Sub-Advisory Agreement appears as Appendix B to this
Proxy Statement.

On August 31, 1992, at the request of the Present Sub-Adviser, the Present
Sub-Advisory Agreement was approved by the Board of Trustees, including a
majority of the Independent Trustees, and was recommended by the Trustees for
shareholder approval. Federated Administrative Services, the initial shareholder
of Independence One U.S. Government Securities Fund, approved the Present
Sub-Advisory Agreement on October 31, 1992. On March 7, 1995, the Present
Sub-Advisory Agreement was renewed for one year by a majority vote of the
Trustees, including a majority of the Independent Trustees, cast in person at a
meeting called for that purpose, on behalf of Independence One U.S. Government
Securities Fund.

Under the terms of the Present Sub-Advisory Agreement, subject to the
direction of the Board of Trustees, the Present Sub-Adviser assists the Present
Adviser in the purchase or sale of the Independence One U.S. Government
Securities Fund's portfolio instruments by furnishing investment advice,
statistical and other factual information as may, from time to time, be
reasonably requested by the Present Adviser. THE PRESENT SUB-ADVISER FURNISHES
THESE SERVICES AND INFORMATION AT NO COST TO THE PRESENT ADVISER OR INDEPENDENCE
ONE U.S. GOVERNMENT SECURITIES FUND.

If approved by shareholders at this Special Meeting, the New Sub-Advisory
Agreement will continue for two years after it takes effect, unless terminated,
and may be continued from year to year thereafter by the Board of Trustees. The
continuation of the New Sub-Advisory Agreement must be approved by a majority
vote of the Trustees, including a majority of the Independent Trustees, cast in
person at a meeting called for that purpose. The New Sub-Adviser has the right,
in any year, to notify Independence One U.S. Government Securities Fund in
writing at least 60 days before the New Sub-Advisory Agreement anniversary date,
that it does not desire a renewal of the New Sub-Advisory Agreement. The
Trustees, or a majority of the outstanding voting shares of Independence One
U.S. Government Securities Fund, may terminate the New Sub-Advisory Agreement at
any time without penalty by giving the New Sub-Adviser 60 days' written notice.
The New Sub-Advisory Agreement may not be assigned and shall terminate
automatically in the event of any assignment as defined in the 1940 Act. The New
Sub-Advisory Agreement provides that it may be amended by a vote of both a
majority of the Trustees, including a majority of the Independent Trustees, and
by the holders of a majority of the outstanding voting shares of Independence
One U.S. Government Securities Fund.

The Trustees of Independence One U.S. Government Securities Fund, including
the Independent Trustees, reviewed and unanimously approved the New Sub-Advisory
Agreement and directed that it be submitted to shareholders for their approval.

If the New Sub-Advisory Agreement and the New Advisory Contract are
approved by shareholders of Independence One U.S. Government Securities Fund and
the Merger is consummated, the New Sub-Advisory Agreement will be executed and
become effective on the Closing Date. In the event the Merger is not
consummated, the Present Sub-Advisory Agreement (as well as the Present Advisory
Contract) will continue in accordance with their terms. If the Merger is
consummated and if the New Advisory Contract is approved but the New
Sub-Advisory Agreement is not approved by the shareholders of the Fund, Michigan
National Bank would be fully responsible for the Fund's investment activities.
If the Merger is consummated and if neither the New Advisory Contract nor the
New Sub-Advisory Agreement is approved by the shareholders of the Fund, the
Present Sub-Advisory Agreement will terminate and the Board of Trustees will
consider what actions should be taken, including but not limited to requesting
that the Present Adviser or Present Sub-Adviser perform investment advisory
services at cost until a new investment advisory contract is approved by the
shareholders.

As indicated earlier in this Proxy Statement under the section entitled
"Approval or Disapproval of a New Advisory Contract," there are various
conditions precedent to the consummation of the Merger including approval of the
shareholders of Michigan National Corporation and approval of regulatory

authorities. Shareholders of Independence One U.S. Government Securities Fund
are not being asked to vote on the Merger.

TRUSTEES' RECOMMENDATIONS AND OTHER INFORMATION

The New Sub-Advisory Agreement was unanimously approved on behalf of
Independence One U.S. Government Securities Fund by the Board of Trustees of the
Trust, including the Independent Trustees, at a meeting held on May 4, 1995. By
approving the New Sub-Advisory Agreement, the Trustees have acted in what they
believe to be the best interest of the shareholders of Independence One U.S.
Government Securities Fund. The Trustees considered information relating to the
Present Sub-Adviser, NAB, and the consolidated entity that would result from the
completion of the Merger, including present capabilities and expertise in
serving as sub-adviser to the Independence One U.S. Government Securities Fund.
They reviewed the terms of the New Sub-Advisory Agreement, including the fact
that the sub-advisory services would continue to be performed at no cost to the
adviser or the Fund. It was also noted that the New Sub-Adviser would continue
to be familiar with the Fund and its shareholder base.

The section entitled "Trustees' Recommendations and Other Information" that
appears earlier in this Proxy Statement discusses additional factors considered
by the Trustees, as well as matters such as "assignment" of an investment
advisory contract and "unfair burden" with respect to the realization of a
profit by the Present Adviser as a result of the Merger. These statements are
also applicable to shareholders of Independence One U.S. Government Securities
Fund with respect to the approval or disapproval of the New Sub-Advisory
Agreement. Shareholders should therefore review this information prior to
determining whether to approve the New Sub-Advisory Agreement.

THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS THAT THE
SHAREHOLDERS OF INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND
APPROVE THE NEW SUB-ADVISORY AGREEMENT

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

NATIONAL AUSTRALIA BANK LIMITED

NAB is a transnational banking organization headquartered at 500 Bourke
Street, Melbourne, Australia. NAB is a publicly owned company, whose shares are
widely held and traded on the Australian Stock Exchange Limited. The following
information appeared in NAB's Annual Report for its fiscal year ended September
30, 1994.

NAB, together with its subsidiaries (collectively, the "Group"), is one of
the four major Australian commercial banks ("trading banks" in Australian
terminology) which together account for approximately 70.2% of commercial
banking assets in Australia as of September 1994, according to the Reserve Bank
of Australia Bulletin. The Group undertakes a range of banking, financial and
related activities in Australia and elsewhere in the world, including commercial
banking, savings banking, finance and life insurance and merchant and investment
banking. As of September 30, 1994, Group assets totalled $125.9 billion, of
which approximately 56.5% was domiciled in Australia, and Group deposits
totalled $78.8 billion, of which approximately 50.8% was domiciled in Australia.

NAB was established as "The National Bank of Australasia" in 1858 in
Victoria, Australia. Through internal expansion and the acquisition of other
banks, NAB developed into a national commercial bank. In its present form, NAB
is the product of the merger in 1981 of The National Bank of Australasia Limited
and Commercial Banking Company of Sydney Limited, the latter Bank being
established in 1834 in New South Wales, Australia.

At September 30, 1994 the Group had 49,163 full-time and part-time
employees worldwide (43,871 full-time equivalents).

Banking, the Group's principal business activity, is conducted in Australia
by NAB and internationally by NAB and certain subsidiaries. As of September 30,
1994, NAB was the second largest

commercial bank in Australia (according to the Reserve Bank of Australia
Bulletin) based on domestic assets of $75 billion. The Group is the largest
Australian banking group based on its global assets of $125.9 billion.

Consistent with its philosophy of providing customers with a comprehensive
range of financial products and services, in 1985 the Group established a life
insurance and funds management entity, National Australia Financial Management
Limited. This entity and its subsidiaries provide the Australian market with a
range of personal financial planning services, personal life and disability
insurance, personal superannuation and managed investments, corporate
superannuation, group life insurance and various investment management services.
At September 30, 1994, funds under management amounted to $4.0 billion. Two of
the Group's banking subsidiaries in the United Kingdom, Yorkshire Bank and
Northern Bank, offer certain insurance and investment products through
subsidiaries, mainly in the areas of funds management and other investment
related products.

At November 11, 1994, the directors* and principal executive officer of NAB
were as follows:
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
NAME AND POSITION POSITION/DIRECTORSHIP PRINCIPAL
WITH NAB HELD SINCE OCCUPATION(S)
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
William Robert Mitchel Irvine 1992/1979 Barrister and Solicitor; Director,
Chairman and Director National Australia Bank Superannuation
Fund Pty Ltd. and Bank of New Zealand;
Chairman, National Australia Financial
Management Limited and National Australia
Group (UK) Limited; former Partner,
Hedderwick Fookes & Alston, Solicitors.
Brian Thorley Loton 1992/1988 Chairman, The Broken Hill Proprietary
Vice-Chairman Company Limited; Director, Amcor Limited
and Director and Australian Foundation Investment
Company Limited; Alternate Director,
National Australia Group (UK) Limited;
former Managing Director, The Broken Hill
Proprietary Company Limited.
David Kennedy Macfarlane 1992/1985 Chairman NAB's Principal Board Audit
Vice-Chairman Committee; Director, Bank of New Zealand;
and Director Alternate Director, National Australia
Group (UK) Limited; 33 years' experience
with James Hardie Industries Limited, 12
years of which as Managing Director.
Donald Robert Argus 1990/1989 Director, National Australia Bank
Managing Director and Superannuation Fund Pty Ltd, Bank of New
Chief Executive Officer Zealand, Clydesdale Bank PLC, National
Australia Financial Management Limited,
National Australia Group (UK) Limited,
National Irish Bank Limited, Northern
Bank Limited and Yorkshire Bank PLC.
David Charles Keith Allen 1992 Managing Director, Woodside Petroleum
Director Limited.
Peter John Waraker Cottrell 1985 Chairman, Email Limited; member of NAB's
Director Principal Board Audit Committee.
Dr. Christopher Michael Deeley 1992 Non-Executive Director and Chairman,
Director North Limited; Director, Goodman Fielder
Limited; former Managing Director and
Chief Executive, ICI Australia Limited.
</TABLE>

<TABLE>
<CAPTION>
NAME AND POSITION POSITION/DIRECTORSHIP PRINCIPAL
WITH NAB HELD SINCE OCCUPATION(S)
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
David Alexander Tange Dickins 1981 Chartered Accountant; Alternate Director,
Director Bank of New Zealand; former Partner,
Court & Co. Chartered Accountants; former
Director, The Commercial Banking Company
of Sydney Limited.
The Lord Nickson 1991 Chairman, Clydesdale Bank PLC; Director,
Director National Australia Group (UK) Limited.
Mark Richard Rayner 1985 Director and Group Executive, CRA
Director Limited; Deputy Chairman and former
Managing Director, Comalco Limited,
Chairman, Pasminco Limited; member of
NAB's Principal Board Audit Committee.
Joseph Charles Trethowan 1984 Vice Chairman of Directors and Chairman,
Director Audit Committee of National Australia
Financial Management Limited; member of
NAB's Principal Board Audit Committee;
former Chairman and General Manager,
State Electricity Commission of Victoria.
Andrew Trunbull 1992 Non-Executive Chairman and former
Director Managing Director and Chief Executive
Officer, Burns Philip and Company
Limited.
Sir Bruce Dunstan Watson 1992 Former Chairman, Director, and Chief
Director Executive Officer, MIM Holdings Limited.
</TABLE>

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

* The Directors of NAB are classified as either Executive or Non-Executive, with
the former being those Directors engaged in the full-time employment of NAB.
Mr. Donald Argus is the only Executive Director.

The address of the Directors and principal executive officer of NAB is c/o
500 Bourke Street, Melbourne, Australia.

OTHER MATTERS AND DISCRETION OF ATTORNEYS NAMED IN THE PROXY

While the Special Meeting is called to act upon any other business that may
properly come before it, at the date of this Proxy Statement the only business
which the management intends to present or knows that others will present is the
business mentioned in the Notice of Meeting. If any other matters lawfully come
before the Special Meeting, and in all procedural matters at the Special
Meeting, it is the intention that the enclosed proxy shall be voted in
accordance with the best judgment of the attorneys named therein, or their
substitutes, present and acting at the Special Meeting.

IF AT THE TIME ANY SESSION OF THE SPECIAL MEETING IS CALLED TO ORDER, A
QUORUM IS NOT PRESENT IN PERSON OR BY PROXY, THE PERSONS NAMED AS PROXIES MAY
VOTE THOSE PROXIES WHICH HAVE BEEN RECEIVED TO ADJOURN THE SPECIAL MEETING TO A
LATER DATE. IN THE EVENT THAT A QUORUM IS PRESENT BUT SUFFICIENT VOTES IN FAVOR
OF ONE OR MORE OF THE PROPOSALS HAVE NOT BEEN RECEIVED, THE PERSONS NAMED AS
PROXIES MAY PROPOSE ONE OR MORE ADJOURNMENTS OF THE SPECIAL MEETING TO PERMIT
FURTHER SOLICITATION OF PROXIES WITH RESPECT TO ANY SUCH PROPOSAL. ALL SUCH
ADJOURNMENTS WILL REQUIRE THE AFFIRMATIVE VOTE OF A MAJORITY OF THE SHARES FOR A
FUND PRESENT IN PERSON OR BY PROXY AT THE SESSION OF THE SPECIAL MEETING TO BE
ADJOURNED. THE PERSONS NAMED AS PROXIES WILL VOTE THOSE PROXIES WHICH THEY ARE
ENTITLED TO VOTE IN FAVOR OF THE PROPOSAL, IN FAVOR OF SUCH AN ADJOURNMENT, AND
WILL VOTE THOSE PROXIES REQUIRED TO BE VOTED AGAINST THE PROPOSAL, AGAINST ANY
SUCH ADJOURNMENT. A VOTE

MAY BE TAKEN ON ONE OR MORE OF THE PROPOSALS IN THIS PROXY STATEMENT PRIOR TO
ANY SUCH ADJOURNMENT IF SUFFICIENT VOTES FOR ITS APPROVAL HAVE BEEN RECEIVED AND
IT IS OTHERWISE APPROPRIATE.

The following shareholder(s) of record owned 5% or more of the outstanding
shares of the Funds indicated below as of June 5, 1995:

INDEPENDENCE ONE MICHIGAN MUNICIPAL CASH FUND

Pierson & Co./Michigan National Bank Trust Operations Department,
Farmington Hills, Michigan, owned approximately 16,069,001.77 shares (23.73%),
which is 2.95% of the Trust's outstanding shares; Christman Company, Lansing,
Michigan, owned approximately 5,050,392.67 shares (7.46%), which is 0.93% of the
Trust's outstanding shares; Oak Mall Shopping Center, Troy, Michigan, owned
approximately 4,064,116.65 shares (6.00%), which is 0.75% of the Trust's
outstanding shares; and Hanna and Gordon Fishman as trustees for Hanna Reta
Fishman Revocable Living Trust, Newport Beach, California, owned approximately
3,436,514.39 shares (5.08%), which is 0.63% of the Trust's outstanding shares.

INDEPENDENCE ONE PRIME MONEY MARKET FUND

Pierson & Co./Michigan National Bank Trust Operations Department,
Farmington Hills, Michigan, owned approximately 105,995,379.92 Class A Shares
which is 42.54% of that Class, 42.54% of the Fund, and 19.48% of the Trust's
outstanding shares.

Federated Administrative Services, Pittsburgh, Pennsylvania, owned
approximately 100.61 Class B Shares which is 40.05% of that Class, and
considerably less than .5 of 1% of the Fund's and the Trust's outstanding
shares; and Federated Services Company, Boston, Massachusetts, owned
approximately 150.6 Class B Shares which is 59.94% of that Class, and
considerably less than .5 of 1% of the Fund's and the Trust's outstanding
shares.

INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND

Pierson & Co./Michigan National Bank Trust Operations Department,
Farmington Hills, Michigan, owned approximately 6,340,409.55 shares (100%),
which is 1.17% of the Trust's outstanding shares.

INDEPENDENCE ONE U.S. TREASURY MONEY MARKET FUND

Pierson & Co./Michigan National Bank Trust Operations Department,
Farmington Hills, Michigan, owned approximately 96,358,850.42 shares (43.63%),
which is 17.71% of the Trust's outstanding shares.

If you do not expect to attend the Special Meeting, please sign your proxy
card promptly and return it in the enclosed envelope to avoid unnecessary
expense and delay. No postage is necessary.

By Order of the Trustees

JAY S. NEUMAN
Secretary
June 16, 1995

APPENDIX A

("NEW ADVISORY CONTRACT")
INDEPENDENCE ONE MUTUAL FUNDS
INVESTMENT ADVISORY CONTRACT

This Contract is made between Michigan National Bank, a national banking
association having its principal place of business in Farmington Hills, Michigan
(the "Adviser"), and Independence One Mutual Funds, a Massachusetts business
trust having its principal place of business in Pittsburgh, Pennsylvania (the
"Trust").

WHEREAS, the Trust is an open-end management investment company as that
term is defined in the Investment Company Act of 1940 and is registered as
such with the Securities and Exchange Commission; and

WHEREAS, the Adviser is engaged in the business of rendering investment
advisory and management services.

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:

1. The Trust hereby appoints Adviser as Investment Adviser for each of the
portfolios ("Funds") of the Trust on whose behalf the Trust executes an exhibit
to this Contract, and Adviser, by its execution of each such exhibit, accepts
the appointments. Subject to the direction of the Trustees of the Trust, Adviser
shall provide investment research and supervision of the investments of each of
the Funds and conduct a continuous program of investment evaluation and of
appropriate sale or other disposition and reinvestment of each Fund's assets.
The Adviser shall determine the securities to be purchased or sold by the Trust
and will place orders pursuant to its determinations with or through such
persons, brokers or dealers in conformity with the policy, with respect to
brokerage as set forth in the Trust's Registration Statement and Prospectus
(hereinafter defined) or as the Board of Trustees may direct from time to time.

2. Adviser, in its supervision of the investments of each of the Funds will
be guided by each of the Fund's fundamental investment policies and the
provisions and restrictions contained in the Declaration of Trust and By-Laws of
the Trust and as set forth in the Registration Statement and exhibits as may be
on file with the Securities and Exchange Commission.

3. The Trust shall pay or cause to be paid, on behalf of each Fund, all of
the Fund's expenses and the Fund's allocable share of Trust expenses, including
without limitation, the expenses of organizing the Trust and continuing its
existence; fees and expenses of officers and Trustees of the Trust; fees for
investment advisory services and administrative services; expenses incurred in
the distribution of each Fund's shares including expenses of administrative
support services; fees and expenses of preparing and printing amendments to its
Registration Statement under the Securities Act of 1933 and the Investment
Company Act of 1940; expenses of registering and qualifying the Trust, the Funds
and shares of the Funds ("Shares") under Federal and state laws and regulations;
expenses of preparing, printing and distributing prospectuses (and any
amendments thereto) and sales literature; expenses of registering, licensing, or
other authorization of the Trust as a broker-dealer and of its officers as
agents and salesmen under federal and state laws and regulations; interest
expense, taxes, fees and commissions of every kind; expenses of issue (including
cost of Share certificates), purchase, repurchase and redemption of Shares,
including expenses attributable to a program of periodic issue; charges and
expenses of custodians, transfer agents, dividend disbursing agents, shareholder
servicing agents and registrars; printing and mailing costs, auditing,
accounting and legal expenses; reports to shareholders and governmental officers
and commissions; expenses of meetings of Trustees and shareholders and proxy
solicitations therefor; insurance expenses; association membership dues; and
such nonrecurring items as may arise, including all losses and liabilities
incurred in administering the Trust and the Funds. The Trust will also pay each
Fund's allocable share of such extraordinary expenses as may arise,

including expenses incurred in connection with litigation, proceedings, and
claims and the legal obligations of the Trust to indemnify its officers and
Trustees and agents with respect thereto.

4. The Trust, on behalf of each of the Funds shall pay to Adviser, for all
services rendered to such Fund by Adviser hereunder, the fees set forth in the
exhibits attached hereto.

5. The Adviser may from time to time and for such periods as it deems
appropriate reduce its compensation (and, if appropriate, assume expenses of one
or more of the Funds) to the extent that any Fund's expenses exceed such lower
expense limitation as the Adviser may, by notice to the Fund, voluntarily
declare to be effective.

6. This Contract shall begin for each Fund on the date that the Trust
executes an exhibit to this Contract relating to such Fund. This Contract shall
remain in effect for each Fund until the first meeting of Shareholders held
after the execution date of an exhibit relating to the respective Fund, and if
approved at such meeting by the shareholders of a particular Fund, shall
continue in effect for such Fund for two years from the date of its execution
and from year to year thereafter, subject to the provisions for termination and
all of the other terms and conditions hereof if: (a) such continuation shall be
specifically approved at least annually by the vote of a majority of the
Trustees of the Trust, including a majority of the Trustees who are not parties
to this Contract or interested persons of any such party (other than as Trustees
of the Trust) cast in person at a meeting called for that purpose; and (b)
Adviser shall not have notified the Trust in writing at least sixty (60) days
prior to the anniversary date of this Contract in any year thereafter that it
does not desire such continuation with respect to that Fund.

7. Notwithstanding any provision in this Contract, it may be terminated at
any time with respect to any Fund, without the payment of any penalty, by the
Trustees of the Trust or by a vote of the shareholders of that Fund on sixty
(60) days' written notice to Adviser.

8. This Contract may not be assigned by Adviser and shall automatically
terminate in the event of any assignment. Adviser may employ or contract with
such other person, persons, corporation or corporations at its own cost and
expense as it shall determine in order to assist it in carrying out this
Contract.

9. In the absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of obligations or duties under this Contract on the part of
Adviser, Adviser shall not be liable to the Trust or to any of the Funds or to
any shareholder for any act or omission in the course of or connected in any way
with rendering services or for any losses that may be sustained in the purchase,
holding or sale of any security.

10. (a) Subject to the conditions set forth below, the Trust agrees to
indemnify and hold harmless the Adviser and each person, if any, who controls
the Adviser within the meaning of Section 15 of the 1933 Act and Section 20 of
the Securities Exchange Act of 1934, as amended, against any and all loss,
liability, claim, damage and expense whatsoever, (including but not limited to
any and all expense whatsoever reasonably incurred in investigating, preparing
or defending against any litigation, commenced or threatened, or any claim
whatsoever) arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or the
Prospectuses (as from time to time amended and supplemented) or the omission or
alleged omission therefrom of a material fact required to be stated therein or
necessary to make statements therein not misleading, unless such statement or
omission was made in reliance upon and in conformity with written information
furnished to the Trust with respect to the Adviser by or on behalf of the
Adviser expressly for use in the Registration Statement or Prospectuses, or any
amendment or supplement thereof.

If any action is brought against the Adviser or any controlling person
thereof in respect of which indemnity may be sought against the Trust pursuant
to the foregoing paragraph, the Adviser shall promptly notify the Trust in
writing of the institution of such action and the Trust shall assume the defense
of such action, including the employment of counsel selected by the Trust and
payment of expenses. The Adviser or any such controlling person thereof shall
have the right to employ separate

counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of the Adviser or such controlling person unless the employment of
such counsel shall have been authorized in writing by the Trust in connection
with the defense of such action or the Trust shall not have employed counsel to
have charge of the defense of such action, in any of which events such fees and
expenses shall be borne by the Trust. Anything in this paragraph to the contrary
notwithstanding, the Trust shall not be liable for any settlement of any such
claim or action effected without its written consent. The Trust agrees promptly
to notify the Adviser of the commencement of any litigation or proceedings
against the Trust or any of its officers or Trustees or controlling persons in
connection with the issue and sale of shares or in connection with such
Registration Statement or Prospectuses.

(b) The Adviser agrees to indemnify and hold harmless the Trust, each
of its Trustees, each of its officers who have signed the Registration
Statement and each other person, if any, who controls the Trust within the
meaning of Section 15 of the 1933 Act, to the same extent as the foregoing
indemnity from the Trust to the Adviser but only with respect to statements
or omissions, if any, made in the Registration Statement or Prospectuses or
any amendment or supplement thereof in reliance upon, and in conformity
with, information furnished to the Trust with respect to the Adviser by or
on behalf of the Adviser expressly for use in the Registration Statement or
Prospectuses or any amendment or supplement thereof. In case any action
shall be brought against the Trust or any other person so indemnified based
on the Registration Statement or Prospectuses, or any amendment or
supplement thereof, and in respect of which indemnity may be sought against
the Adviser, the Adviser shall have the rights and duties given to the
Trust, and the Trust and each other person so indemnified shall have the
rights and duties given to the Adviser by the provisions of subsection (a)
above.

(c) Nothing herein contained shall be deemed to protect any person
against liability to the Trust or its shareholders to which such person
would otherwise be subject by reason of willful misfeasance, bad faith or
gross negligence in the performance of the duties of such person or by
reason of the reckless disregard by such person of the obligations and
duties of such person under this Contract.

11. This Contract may be amended at any time by agreement of the parties
provided that the amendment shall be approved both by the vote of a majority of
the Trustees of the Trust, including a majority of Trustees who are not parties
to this Contract or interested persons of any such party to this Contract (other
than as Trustees of the Trust), cast in person at a meeting called for that
purpose, and on behalf of a Fund by a majority of the outstanding voting
securities of such Fund.

12. The Adviser acknowledges that all sales literature for investment
companies (such as the Trust) are subject to strict regulatory oversight. The
Adviser agrees to submit any proposed sales literature for the Trust (or any
Fund) or for itself or its affiliates which mentions the Trust (or any Fund) to
the Trust's distributor for review and filing with the appropriate regulatory
authorities prior to the public release of any such sales literature. The Trust
agrees to cause its distributors to promptly review all such sales literature to
ensure compliance with relevant requirements, to promptly advise Adviser of any
deficiencies contained in such sales literature, to promptly file complying
sales literature with the relevant authorities, and to cause such sales
literature to be distributed to prospective investors in the Trust.

13. Adviser is hereby expressly put on notice of the limitation of
liability as set forth in Article XI of the Declaration of Trust and agrees that
the obligations pursuant to this Contract of a particular Fund and of the Trust
with respect to that particular Fund be limited solely to the assets of that
particular Fund, and Adviser shall not seek satisfaction of any such obligation
from the assets of any other Fund, the shareholders of any Fund, the Trustees,
officers, employees or agents of the Trust, or any of them.

14. This Contract shall be construed in accordance with and governed by the
laws of the Commonwealth of Pennsylvania.

15. This Contract will become binding on the parties hereto upon their
execution of the attached exhibits to this Contract.

EXHIBIT A
INDEPENDENCE ONE MICHIGAN MUNICIPAL CASH FUND

For all services rendered by Adviser hereunder, the Trust shall pay to
Adviser and Adviser agrees to accept as full compensation for all services
rendered hereunder, an annual investment advisory fee equal to 0.40 of 1% of the
average daily net assets of the Fund.

The fee shall be accrued daily at the rate of 1/365th of 0.40% applied to
the daily net assets of the Fund.

The advisory fee so accrued shall be paid to Adviser daily.

Witness the due execution hereof this day of , 1995.

<TABLE>
<S> <C>
Attest: MICHIGAN NATIONAL BANK

By:

- -------------------- -------------------------
Secretary Vice President

Attest: INDEPENDENCE ONE MUTUAL FUNDS

By:
- -------------------- -------------------------
Secretary President
</TABLE>

EXHIBIT B
INDEPENDENCE ONE PRIME MONEY MARKET FUND

The fee shall be accrued daily at the rate of 1/365th of 0.40% applied to
the daily net assets of the Fund.

The advisory fee so accrued shall be paid to Adviser daily.

Witness the due execution hereof this day of , 1995.

<TABLE>
<S> <C>
Attest: MICHIGAN NATIONAL BANK

By:
- -------------------- -------------------------
Secretary Vice President

Attest: INDEPENDENCE ONE MUTUAL FUNDS

By:
- -------------------- -------------------------
Secretary President
</TABLE>

EXHIBIT C
INDEPENDENCE ONE U.S. TREASURY MONEY MARKET FUND

The fee shall be accrued daily at the rate of 1/365th of 0.40% applied to
the daily net assets of the Fund.

The advisory fee so accrued shall be paid to Adviser daily.

Witness the due execution hereof this day of , 1995.

<TABLE>
<S> <C>
Attest: MICHIGAN NATIONAL BANK

By:
- -------------------- -------------------------
Secretary Vice President

Attest: INDEPENDENCE ONE MUTUAL FUNDS

By:
- -------------------- -------------------------

Secretary President
</TABLE>

EXHIBIT D
INVESTMENT ADVISORY CONTRACT
INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND

The fee shall be accrued daily at the rate of 1/365th of 0.70% applied to
the daily net assets of the Fund.

The advisory fee so accrued shall be paid to Adviser daily.

Witness the due execution hereof this day of , 1995.

<TABLE>
<S> <C>
Attest: MICHIGAN NATIONAL BANK

By:
- -------------------- -------------------------
Secretary Vice President

Attest: INDEPENDENCE ONE MUTUAL FUNDS

By:
- -------------------- -------------------------
Assistant Secretary President
</TABLE>

APPENDIX B

("NEW SUB-ADVISORY AGREEMENT")
INDEPENDENCE ONE MUTUAL FUNDS
SUB-ADVISORY AGREEMENT

THIS AGREEMENT is made between Michigan National Bank, a national banking
association (hereinafter referred to as "Adviser") and Independence One Capital
Management Corporation, a registered investment adviser located in Farmington
Hills, Michigan (hereinafter referred to as the "Sub-Adviser").

WITNESSETH:

That the parties hereto, intending to be legally bound hereby agree as
follows:

1. Sub-Adviser hereby agrees to furnish to Adviser in its capacity as
investment adviser to the Independence One U.S. Government Securities Fund (the
"Fund"), a portfolio of Independence One Mutual Funds (the "Trust"), such
investment advice, statistical and other factual information, as may from time
to time be reasonably requested by Adviser for the Fund which may be offered in
one or more classes of shares ("Classes").

2. For its services under this Agreement, Sub-Adviser shall receive from
Adviser no annual fee ("the Sub-Advisory Fee").

Notwithstanding any other provision of this Agreement, the Sub-Adviser may
from time to time and for such periods as it deems appropriate assume expenses
of the Fund or Class of the Fund to the extent that the Fund's expenses exceed
such lower expense limitation as the Sub-Adviser may, by notice to the Trust on
behalf of the Fund, voluntarily declare to be effective.

3. This Agreement shall begin for the Fund on the date that the parties
execute this Agreement. This Agreement shall remain in effect for the Fund until
the first meeting of Shareholders held after the execution date and if approved
at such meeting by the shareholders of the Fund, shall continue in effect for
the Fund for two years from the date of its execution and from year to year
thereafter, subject to the provisions for termination and all of the other terms
and conditions hereof if: (a) such continuation shall be specifically approved
at least annually by the vote of a majority of the Trustees of the Trust,
including a majority of the Trustees who are not parties to this Agreement or
interested persons of any such party (other than as Trustees of the Trust) cast
in person at a meeting called for that purpose; and (b) Sub-Adviser shall not
have notified the Adviser and Adviser shall not have notified the Trust in
writing at least sixty (60) days prior to the anniversary date of this Agreement
in any year thereafter that Sub-Adviser does not desire such continuation with
respect to the Fund.

4. Notwithstanding any provision in this Agreement, it may be terminated at
any time without the payment of any penalty: (a) by the Trustees of the Trust or
by a vote of a majority of the outstanding voting securities (as defined in
Section 2(a)(42) of the Act) of the Fund on sixty (60) days' written notice to
Adviser; (b) by Sub-Adviser or Adviser upon 120 days' written notice to the
other party to the Agreement.

5. This Agreement shall automatically terminate: (a) in the event of its
assignment (as defined in the Investment Company Act of 1940); or (b) in the
event of termination of the Investment Advisory Contract for any reason
whatsoever.

6. So long as both Adviser and Sub-Adviser shall be legally qualified to
act as an investment adviser to the Fund, neither Adviser nor Sub-Adviser shall
act as an investment adviser (as such term is defined in the Investment Company
Act of 1940) to the Fund except as provided herein and in the Investment
Advisory Contract or in such other manner as may be expressly agreed between
Adviser and Sub-Adviser.

Provided, however, that if the Adviser or Sub-Adviser shall resign prior to
the end of any term of this Agreement or for any reason be unable or unwilling
to serve for a successive term which has been approved by the Trustees of the
Trust pursuant to the provisions of Paragraph 3 of this Agreement or Paragraph 6
of the Investment Advisory Contract, the remaining party, Sub-Adviser or Adviser
as the case may be, shall not be prohibited from serving as an investment
adviser to such Fund by reason of the provisions of this Paragraph 6.

7. This Agreement may be amended from time to time by agreement of the
parties hereto provided that such amendment shall be approved both by the vote
of a majority of Trustees of the Trust, including a majority of Trustees who are
not parties to this Agreement or interested persons, as defined in Section
2(a)(19) of the Investment Company Act of 1940, of any such party at a meeting
called for that purpose, and by the holders of a majority of the outstanding
voting securities (as defined in Section 2(a)(42) of the Investment Company Act
of 1940) of the Fund.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on their behalf by their duly authorized officers, this day of
, 1995.

<TABLE>
<S> <C>
Attest: MICHIGAN NATIONAL BANK

By:
- -------------------- -------------------------
Secretary Vice President

Independence One Capital Management
Attest: Corporation

By:
- -------------------- -------------------------
Secretary Vice President
</TABLE>

G01184-01 (6/95)
MIF506008

INDEPENDENCE ONE MICHIGAN MUNICIPAL CASH FUND

Federated Investors Tower
Pittsburgh, PA 15222-3779

___________________________________________________________

INDEPENDENCE ONE MICHIGAN MUNICIPAL CASH FUND
a Portfolio of
INDEPENDENCE ONE MUTUAL FUNDS

CUSIP NO. 453777401

FOR SPECIAL MEETING OF SHAREHOLDERS JULY 31, 1995

KNOW ALL PERSONS BY THESE PRESENTS that the undersigned shareholders of
Independence One Michigan Municipal Cash Fund, a portfolio of Independence One
Mutual Funds, hereby appoint Patricia F. Conner, Jay S. Neuman, Erin Ratesic,
Leanne O'Brien, and Jody L. Petras, or any of them true and lawful attorneys,
with power of substitution of each, to vote all shares of Independence One
Michigan Municipal Cash Fund, a portfolio of Independence One Mutual Funds,
which the undersigned is entitled to vote, at the Special Meeting of
Shareholders to be held on July 31, 1995, at Federated Investors Tower,
Pittsburgh, Pennsylvania, at 2:00 p.m. (Eastern Time) and at any adjournment
thereof.

Discretionary authority is hereby conferred as to all other matters as may
properly come before the Special Meeting.

PROPOSAL(S)

1. TO APPROVE OR DISAPPROVE A NEW INVESTMENT ADVISORY CONTRACT BETWEEN THE
TRUST, ON BEHALF OF INDEPENDENCE ONE MICHIGAN MUNICIPAL CASH FUND, AND
MICHIGAN NATIONAL BANK; AND

2. TO ELECT ONE TRUSTEE

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES.
The attorneys named will vote the shares represented by this proxy in
accordance with the choices made on this card. IF NO CHOICE IS INDICATED AS
TO ANY ITEM, THIS PROXY WILL BE VOTED AFFIRMATIVELY ON THAT MATTER.

PLEASE RETURN BOTTOM PORTION WITH YOUR VOTE IN
THE ENCLOSED ENVELOPE AND RETAIN THE TOP PORTION. Place the
ballot so that the return address, located on the reverse side of the mail-in-
stub, appears through the window of the envelope.

Independence One Michigan Municipal PROXY VOTING MAIL-IN STUB
Cash Fund

RECORD DATE SHARES

PORPOSAL(S)

PROPOSAL 1 THE NEW INVESTMENT ADVISORY CONTRACT

FOR:

AGAINST:

ABSTAIN:

PROPOSAL 2: ELECT THOMAS S. WILSON AS TRUSTEE

FOR:

AGAINST:

ABSTAIN:

Please sign EXACTLY as your name(s) appear
above. When signing as attorney, executor,
administrator, guardian, trustee, custodian,
etc., please give your full title as such. If a
corporation or partnership, please sign the full
name by an authorized officer or partner. If
stock is owned jointly, all owners should sign.

_____________________________________
Signature(s) of Shareholder(s)

Date:________________________________

INDEPENDENCE ONE PRIME MONEY MARKET FUND CLASS A

Federated Investors Tower
Pittsburgh, PA 15222-3779

___________________________________________________________

INDEPENDENCE ONE PRIME MONEY MARKET FUND CLASS A
a Portfolio of
INDEPENDENCE ONE MUTUAL FUNDS

CUSIP NO. 453777203

FOR SPECIAL MEETING OF SHAREHOLDERS JULY 31, 1995

KNOW ALL PERSONS BY THESE PRESENTS that the undersigned shareholders of Class
A Shares of Independence One Prime Money Market Fund, a portfolio of
Independence One Mutual Funds, hereby appoint Patricia F. Conner, Jay S.
Neuman, Erin Ratesic, Leanne O'Brien, and Jody L. Petras, or any of them true
and lawful attorneys, with power of substitution of each, to vote all Class A
Shares of Independence One Prime Money Market Fund, a portfolio of
Independence One Mutual Funds, which the undersigned is entitled to vote, at
the Special Meeting of Shareholders to be held on July 31, 1995, at Federated
Investors Tower, Pittsburgh, Pennsylvania, at 2:00 p.m. (Eastern Time) and at
any adjournment thereof.

Discretionary authority is hereby conferred as to all other matters as may
properly come before the Special Meeting.

PROPOSAL(S)

1. TO APPROVE OR DISAPPROVE A NEW INVESTMENT ADVISORY CONTRACT BETWEEN THE
TRUST, ON BEHALF OF INDEPENDENCE ONE PRIME MONEY MARKET FUND, AND MICHIGAN
NATIONAL BANK; AND

2. TO ELECT ONE TRUSTEE.

Independence One Prime Money PROXY VOTING MAIL-IN STUB
Market Fund
Class A

RECORD DATE SHARES

PROPOSAL(S)

PROPOSAL 1: THE NEW INVESTMENT ADVISORY CONTRACT

FOR:

AGAINST:

ABSTAIN:

PROPOSAL 2: ELECT THOMAS S. WILSON AS TRUSTEE

FOR:

AGAINST:

ABSTAIN:

_____________________________________
Signature(s) of Shareholder(s)

Date:________________________________

INDEPENDENCE ONE PRIME MONEY MARKET FUND CLASS B

Federated Investors Tower
Pittsburgh, PA 15222-3779

___________________________________________________________

INDEPENDENCE ONE PRIME MONEY MARKET FUND CLASS B
a Portfolio of
INDEPENDENCE ONE MUTUAL FUNDS

CUSIP NO. 453777302

FOR SPECIAL MEETING OF SHAREHOLDERS JULY 31, 1995

KNOW ALL PERSONS BY THESE PRESENTS that the undersigned shareholders of Class
B Shares of Independence One Prime Money Market Fund, a portfolio of
Independence One Mutual Funds, hereby appoint Patricia F. Conner, Jay S.
Neuman, Erin Ratesic, Leanne O'Brien, and Jody L. Petras, or any of them true
and lawful attorneys, with power of substitution of each, to vote all Class B
Shares of Independence One Prime Money Market Fund, a portfolio of
Independence One Mutual Funds, which the undersigned is entitled to vote, at
the Special Meeting of Shareholders to be held on July 31, 1995, at Federated
Investors Tower, Pittsburgh, Pennsylvania, at 2:00 p.m. (Eastern Time) and at
any adjournment thereof.

Discretionary authority is hereby conferred as to all other matters as may
properly come before the Special Meeting.

PROPOSAL(S)

1. TO APPROVE OR DISAPPROVE A NEW INVESTMENT ADVISORY CONTRACT BETWEEN THE
TRUST, ON BEHALF OF INDEPENDENCE ONE PRIME MONEY MARKET FUND, AND MICHIGAN
NATIONAL BANK; AND

2. TO ELECT ONE TRUSTEE.

Independence One Prime Money PROXY VOTING MAIL-IN STUB
Market Fund
Class B

RECORD DATE SHARES

PROPOSAL(S)

PROPOSAL 1: THE NEW INVESTMENT ADVISORY CONTRACT

FOR:

AGAINST:

ABSTAIN:

PROPOSAL 2: ELECT THOMAS S. WILSON AS TRUSTEE

FOR:

AGAINST:

ABSTAIN:

_____________________________________
Signature(s) of Shareholder(s)

Date:________________________________

INDEPENDENCE ONE U.S. TREASURY MONEY MARKET FUND

Federated Investors Tower
Pittsburgh, PA 15222-3779

___________________________________________________________

INDEPENDENCE ONE U.S. TREASURY MONEY MARKET FUND
a Portfolio of
INDEPENDENCE ONE MUTUAL FUNDS

CUSIP NO. 453777708

FOR SPECIAL MEETING OF SHAREHOLDERS JULY 31, 1995

KNOW ALL PERSONS BY THESE PRESENTS that the undersigned shareholders of
Independence One U.S. Treasury Money Market Fund, a portfolio of Independence
One Mutual Funds, hereby appoint Patricia F. Conner, Jay S. Neuman, Erin
Ratesic, Leanne O'Brien, and Jody L. Petras, or any of them true and lawful
attorneys, with power of substitution of each, to vote all shares of
Independence One U.S. Treasury Money Market Fund, a portfolio of Independence
One Mutual Funds, which the undersigned is entitled to vote, at the Special
Meeting of Shareholders to be held on July 31, 1995, at Federated Investors
Tower, Pittsburgh, Pennsylvania, at
2:00 p.m. (Eastern Time) and at any adjournment thereof.

Discretionary authority is hereby conferred as to all other matters as may
properly come before the Special Meeting.

PROPOSAL(S)

1. TO APPROVE OR DISAPPROVE A NEW INVESTMENT ADVISORY CONTRACT BETWEEN THE
TRUST, ON BEHALF OF INDEPENDENCE ONE U.S. TREASURY MONEY MARKET FUND, AND
MICHIGAN NATIONAL BANK; AND

2. TO ELECT ONE TRUSTEE.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
The attorneys named will vote the shares represented by this proxy in
accordance with the choices made on this card. IF NO CHOICE IS INDICATED AS
TO ANY ITEM, THIS PROXY WILL BE VOTED AFFIRMATIVELY ON THAT MATTER.

Independence One U.S. Treasury Money PROXY VOTING MAIL-IN Market
Fund STUB

RECORD DATE SHARES

PROPOSAL(S)

PROPOSAL 1 THE NEW INVESTMENT ADVISORY CONTRACT

FOR:

AGAINST:

ABSTAIN:

PROPOSAL 2 ELECT THOMAS S. WILSON AS TRUSTEE

FOR:

AGAINST:

ABSTAIN:

_____________________________________
Signature(s) of Shareholder(s)

Date:________________________________

INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND

Federated Investors Tower
Pittsburgh, PA 15222-3779

___________________________________________________________

INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND
a Portfolio of
INDEPENDENCE ONE MUTUAL FUNDS

CUSIP NO. 453777807

FOR SPECIAL MEETING OF SHAREHOLDERS JULY 31, 1995

KNOW ALL PERSONS BY THESE PRESENTS that the undersigned shareholders of
Independence One U.S. Government Securities Fund, a portfolio of Independence
One Mutual Funds, hereby appoint Patricia F. Conner, Jay S. Neuman, Erin
Ratesic, Leanne O'Brien, and Jody L. Petras, or any of them true and lawful
attorneys, with power of substitution of each, to vote all shares of
Independence One U.S. Government Securities Fund, a portfolio of Independence
One Mutual Funds, which the undersigned is entitled to vote, at the Special
Meeting of Shareholders to be held on July 31, 1995, at Federated Investors
Tower, Pittsburgh, Pennsylvania, at
2:00 p.m. (Eastern Time) and at any adjournment thereof.

Discretionary authority is hereby conferred as to all other matters as may
properly come before the Special Meeting.

PROPOSAL(S)

1. TO APPROVE OR DISAPPROVE A NEW INVESTMENT ADVISORY CONTRACT BETWEEN THE
TRUST, ON BEHALF OF INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND, AND
MICHIGAN NATIONAL BANK;

2. TO APPROVE OR DISAPPROVE A NEW SUB-ADVISORY AGREEMENT BETWEEN INDEPENDENCE
ONE CAPITAL MANAGEMENT CORPORATION AND MICHIGAN NATIONAL BANK, ON BEHALF OF
INDEPENDENCE ONE U.S. GOVERNMENT SECURITIES FUND; AND

3. TO ELECT ONE TRUSTEE.

Independence One U.S. Government PROXY VOTING MAIL-IN Securities Fund
STUB

RECORD DATE SHARES

PROPOSAL(S):

PROPOSAL 1 THE NEW INVESTMENT ADVISORY CONTRACT

FOR:

AGAINST:

ABSTAIN:

PROPOSAL 2 THE NEW SUB-ADVISORY AGREEMENT

FOR:

AGAINST:

ABSTAIN:

PROPOSAL 3 ELECT THOMAS S. WILSON AS TRUSTEE

FOR:

AGAINST:

ABSTAIN:

_____________________________________
Signature(s) of Shareholder(s)

Date:________________________________