MUNDER ACCELERATING GROWTH FUND
480 Pierce Street
Birmingham, Michigan 48009
October 20, 1998
Dear Shareholder:
The Board of Trustees of The Munder Funds Trust has recently
reviewed and unanimously endorsed a proposal for the reorganization of the
Munder Accelerating Growth Fund (the "Fund") which they judge to be in the
best interests of the Fund's shareholders. This proposal calls for the
acquisition of the assets of the Fund by the Munder Multi-Season Growth Fund
("Munder Growth Fund"), which has investment objectives and policies similar
to those of the Fund.
We have therefore called a Special Meeting of Shareholders to be
held at 480 Pierce Street, Birmingham, Michigan 48009 on November 20, 1998 to
consider this transaction. WE STRONGLY INVITE YOUR PARTICIPATION BY ASKING
YOU TO REVIEW, COMPLETE AND RETURN YOUR PROXY AS SOON AS POSSIBLE.
As a result of this transaction, the Fund would be combined with
Munder Growth Fund and you would become a shareholder of Munder Growth Fund,
receiving shares of Munder Growth Fund having an aggregate net asset value
equal to the aggregate net asset value of your investment in the Fund. No
sales charge will be imposed in the transaction and the closing of the
transaction will be conditioned upon receiving an opinion of counsel to the
effect that the proposed transaction will qualify as a tax-free
reorganization for federal income tax purposes.
Munder Growth Fund, like the Fund, seeks long-term capital
appreciation. The Fund and Munder Growth Fund have a common investment
adviser (Munder Capital Management), a common administrator (State Street
Bank and Trust Company) and a common distributor (Funds Distributor, Inc.).
Additionally, shareholders are being asked to consider a new
investment advisory agreement with Munder Capital Management, the Fund's
investment adviser. Detailed information about the proposals and the reasons
for them are contained in the enclosed materials. Please exercise your right
to vote by completing, dating and signing the enclosed proxy card. A
self-addressed, postage-paid envelope has been enclosed for your convenience.
It is very important that you vote and that your voting instructions be
received no later than November 20, 1998.
Sincerely,
Lee P. Munder
President
<PAGE>
THE MUNDER FUNDS TRUST
MUNDER ACCELERATING GROWTH FUND
480 Pierce Street
Birmingham, Michigan 48009
Telephone: (800) 438-5789
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To Be Held on November 20, 1998
To the Shareholders of
Munder Accelerating Growth Fund
of The Munder Funds Trust:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders of
The Munder Accelerating Growth Fund (the "Fund") of The Munder Funds Trust
will be held at 480 Pierce Street, Birmingham, Michigan 48009 on November 20,
1998 at 10:00 a.m. (Eastern Time) for the following purposes:
1. To consider and vote on approval of an Agreement and Plan of
Reorganization providing for the acquisition of all or substantially all of
the assets of the Fund by Munder Multi-Season Growth Fund ("Munder Growth
Fund"), a series of The Munder Funds, Inc., in exchange for shares of Munder
Growth Fund and assumption of certain identified liabilities of the Fund by
Munder Growth Fund, and for the distribution of such shares to shareholders
of the Fund in liquidation of the Fund;
2. To consider and vote on approval of a New Investment Advisory
Agreement for the Fund, containing substantially the same terms as the Prior
Investment Advisory Agreement in place for the Fund;
3. To transact such other business as may properly come before the
meeting, or any adjournment or adjournments thereof.
<PAGE>
The Board of Trustees has fixed the close of business on
September 30, 1998, as the Record Date for determination of shareholders
entitled to notice of, and to vote at, the meeting.
EACH SHAREHOLDER WHO DOES NOT EXPECT TO ATTEND THE MEETING IN
PERSON IS REQUESTED TO DATE, FILL IN, SIGN AND RETURN PROMPTLY THE ENCLOSED
FORM OF PROXY IN THE ENCLOSED ENVELOPE, WHICH NEEDS NO POSTAGE IF MAILED IN
THE UNITED STATES.
By Order of the Board of Trustees
Lisa A. Rosen
Secretary
October 20, 1998
-2-
<PAGE>
PROSPECTUS/PROXY STATEMENT DATED October 20, 1998
Acquisition of the Assets of
THE MUNDER ACCELERATING GROWTH FUND
480 Pierce Street
Birmingham, Michigan 48009
(800) 438-5789
By and in Exchange for
Shares of
THE MUNDER MULTI-SEASON GROWTH FUND
480 Pierce Street
Birmingham, Michigan 48009
(800) 438-5789
This Prospectus/Proxy Statement is being furnished to shareholders
of the Munder Accelerating Growth Fund (the "Fund"), a series of The Munder
Funds Trust (the "Trust"), in connection with a proposed Agreement and Plan
of Reorganization (the "Plan"), which includes the termination of the Fund
following the transfer of all or substantially all of the assets of the Fund.
The proxy statement also discusses a proposal for shareholder approval of a
new investment advisory agreement for the Fund which is not part of the
Prospectus.
Plan of Reorganization
The Plan is being submitted to shareholders of the Fund for
consideration at a Special Meeting of Shareholders to be held at 480 Pierce
Street, Birmingham, Michigan 48009 on November 20, 1998 (the "Meeting"). The
Plan provides for the acquisition of all or substantially all of the assets
of the Fund by the Munder Multi-Season Growth Fund ("Munder Growth Fund"), a
series of The Munder Funds, Inc., (the "Company") in exchange for shares of
Munder Growth Fund and the assumption by Munder Growth Fund of certain
identified liabilities of the Fund. Following this acquisition, the Fund will
be terminated, all remaining liabilities of the Fund will be satisfied
(whether by payment or the establishment of reasonable reserves for payment)
and shares of Munder Growth Fund will be distributed to shareholders of the
Fund (these transactions collectively referred to as the "Reorganization").
As a result of the proposed Reorganization, each shareholder of
the Fund will receive that number of shares of Munder Growth Fund having an
aggregate net asset value equal to the aggregate net asset value of such
shareholder's shares of the Fund. Holders of Class A shares in the Fund will
receive Class A shares of Munder Growth Fund, and no sales charge will be
imposed on the Class A shares of Munder Growth Fund received by Fund
shareholders. Holders of Class B and Class C Shares in the Fund will receive
shares of the corresponding class of Munder Growth Fund. Subsequent to the
transaction, any contingent deferred sales charge ("CDSC") which is
applicable to a shareholder's investment in Class B or Class C shares of the
<PAGE>
Fund will continue to apply, and, in calculating the applicable CDSC, the
period during which a Fund shareholder held Class B or Class C shares of the
Fund will be counted. Holders of Class K shares and Class Y shares of the
Fund will receive shares of the corresponding class of Munder Growth Fund
without the imposition of any sales charge.
This transaction is being structured as a tax-free reorganization.
See "Information About the Reorganization - Federal Income Tax Consequences."
Shareholders should consult their tax advisers to determine the actual impact
of the Reorganization in light of their individual tax circumstances.
Munder Growth Fund is a diversified series of the Company, a
registered open-end management investment company. Munder Growth Fund's
investment objective is to provide shareholders with long-term capital
appreciation. It seeks to achieve this objective by investing primarily in a
diversified portfolio of equity securities of companies that have
demonstrated superior, long-term earnings growth, financial stability,
attractive valuation, and relative price momentum. The Fund is a diversified
series of the Trust, a registered open-end management investment company. The
Fund's primary investment objective is to provide long-term capital
appreciation; income is a secondary objective. The Fund seeks to achieve
these objectives by investing primarily in equity securities of companies
that have demonstrated the potential for accelerated earnings growth, the
maintenance of a substantial competitive advantage, a focused management team
and a stable balance sheet. While the investment objectives and policies of
the Fund and Munder Growth Fund are generally similar, there are certain
differences in investment policies, which are described under "Comparison of
Investment Objectives and Policies" in this Prospectus/Proxy Statement.
Munder Capital Management serves as investment adviser for the
Munder Growth Fund and the Fund. Munder Capital Management is described in
more detail under "Information About Management of Munder Growth Fund and the
Fund."
Consideration of New Investment Advisory Agreement
The Adviser is organized as a Delaware general partnership. Prior
to July 2, 1998, the general partnership interests in the Investment Adviser
were owned by Old MCM, Inc. (44%), WAM Holdings, Inc. (44%), and Munder Group
L.L.C. (12%). WAM Holdings, Inc. is wholly-owned by Comerica Incorporated.
Mr. Lee P. Munder, Chairman of MCM, owned 83% of Old MCM, Inc. (representing
a 36% indirect interest in MCM) and 68% of Munder Group L.L.C. (representing
an 8% indirect interest in MCM). Mr. Munder through his ownership interest in
Old MCM Inc. and Munder Group L.L.C. owned or controlled approximately 44% of
MCM. Employees of MCM owned the remaining 12% of MCM. On July 2, 1998,
Comerica Incorporated, through a subsidiary, WAM Holdings II, Inc., purchased
85% of Old MCM, Inc.'s interest in MCM (representing a 37.4% interest in MCM)
and 85% of Mr. Munder's interest in Munder Group L.L.C. (representing a 6.9%
interest in MCM) (the "Transaction"). As a result, Comerica Incorporated
indirectly owns or controls approximately 88% of the partnership interests in
MCM. Consummation of the Transaction may have constituted an "assignment" of
the investment advisory agreement (as defined in the 1940 Act) and therefore
terminated the investment advisory agreement in accordance with its terms. It
is therefore proposed that
-2-
<PAGE>
shareholders of the Fund approve a new investment advisory agreement on
behalf of the Fund with the Investment Adviser.
This Prospectus/Proxy Statement, which should be retained for
future reference, sets forth concisely the information about Munder Growth
Fund that a prospective investor should know before investing. A Statement of
Additional Information dated October 20, 1998, relating to this
Prospectus/Proxy Statement and the Reorganization, has been filed with the
Securities and Exchange Commission ("SEC") and is incorporated by reference
into this Prospectus/Proxy Statement. A copy of the Statement of Additional
Information is available upon request and without charge by calling or
writing to the Fund at the telephone number or address listed for the Fund on
the cover page of this Prospectus/Proxy Statement. The Prospectus of Munder
Growth Fund and the Fund (Class A, Class B, and Class C shares) dated October
29, 1997, the Prospectus for the Munder Growth Fund and the Fund (Class K
Shares) dated October 29, 1997, and the Prospectus for the Munder Growth Fund
and the Fund (Class Y Shares) dated October 29, 1997, as applicable,
accompany this Prospectus/Proxy Statement. The Annual Report for the Munder
Growth Fund has been fled with the SEC and is incorporated herein by
reference.
Also accompanying this Prospectus/Proxy Statement as Exhibit A is
a copy of the Agreement and Plan of Reorganization pertaining to the
transaction.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR
DETERMINED IF THIS PROSPECTUS/PROXY STATEMENT IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-3-
<PAGE>
I. APPROVAL OR DISAPPROVAL OF THE AGREEMENT AND PLAN OF REORGANIZATION
COMMON QUESTIONS AND ANSWERS
ABOUT THE PROPOSED REORGANIZATION
Q. How will the Reorganization affect me?
A. The assets of the Fund will be combined with those of Munder
Growth Fund and you will become a shareholder of Munder Growth
Fund. You will receive shares of Munder Growth Fund equal in value
at the time of issuance to the shares of the Fund that you hold
immediately prior to the Reorganization. (Shareholders of Class A
shares, Class B shares, Class C shares, Class K shares, and Class
Y shares of the Fund will receive Class A shares, Class B shares,
Class C shares, Class K shares, and Class Y shares, respectively,
of Munder Growth Fund.)
Q. Why is the Reorganization being recommended?
A. The primary purposes of the proposed Reorganization are to seek to
achieve future economies of scale and eliminate certain costs
associated with operating the Fund and Munder Growth Fund
separately. These two funds have similar investment objectives and
policies, as described in detail below. The Reorganization will
result in combining the assets of the funds and consolidating
their operations.
Combining the assets of the funds is intended to provide various
benefits to shareholders of the Fund who become shareholders of
Munder Growth Fund (as well as to existing and future investors of
Munder Growth Fund). For example, higher asset levels should
enable Munder Growth Fund to spread fixed and relatively fixed
costs, such as accounting, legal, and printing expenses, over a
larger asset base, thereby reducing per-share expense levels. (See
also next question regarding operating expenses of the funds.)
Higher asset levels also should benefit portfolio management by
permitting larger individual portfolio investments that may result
in reduced transaction costs and/or more favorable pricing and by
providing the opportunity for greater portfolio diversity.
Q. How will the fees paid by Munder Growth Fund compare to those
payable by the Fund?
A. The total per share operating expenses of the Munder Growth Fund
are higher than those of the Fund. However, Munder Capital
Management has agreed to waive its fees and/or reimburse the
Munder Growth Fund for expenses until at least June 30, 2000 so
that the expense ratio of Munder Growth Fund will not exceed that
of the Fund as of its most recent fiscal year ended June 30, 1998.
In addition, Munder Capital Management anticipates that the
aggregate fees and expenses of Munder Growth Fund will, over time,
-4-
<PAGE>
be reduced due to increased economies of scale resulting from the
larger aggregate net asset base of the combined entity.
Q. Will I have to pay any sales load, commission or other
transactional fee in connection with the Reorganization?
A. No. The full value of your shares of the Fund will be exchanged
for shares of the class of Munder Growth Fund without any sales
load, commission or other transactional fee being imposed. Each of
the funds will bear its own expenses in connection with the
reorganization.
Q. Who will serve as investment adviser and provide other services to
Munder Growth Fund
A. Munder Growth Fund has the same adviser (Munder Capital
Management) and the same distributor (Funds Distributor, Inc.) as
the Fund. State Street Bank and Trust Company currently serves as
administrator to both the Fund and Munder Growth Fund.
Q. Will I have to pay any federal income taxes as a result of the
Reorganization?
A. The transaction is intended to qualify as a tax-free
reorganization for federal income tax purposes. Assuming
qualification for such treatment; shareholders would not recognize
taxable gain or loss on the exchange of their Fund shares for
shares of Munder Growth Fund. As a condition to the closing of the
Reorganization, the Fund will receive an opinion of counsel to the
effect that the Reorganization will qualify as a tax-free
reorganization for federal income tax purposes. You should
separately consider any state, local and other tax consequences in
consultation with your tax adviser. Opinions of counsel are not
binding on the IRS or the courts.
Q. If the reorganization were approved, would I continue to be able
to exchange my shares for shares of other funds of the Munder
family of mutual funds?
A. Yes. Holders of Class A, Class B, Class C, Class K and Class Y
shares of the Munder Growth Fund can exchange their shares for
shares of the same class of other funds of the Company, the Trust
and The Munder Framlington Funds Trust, subject to certain
restrictions described in the prospectus of each fund. Before
requesting any such exchange, shareholders should carefully review
the applicable prospectus for the other fund to ensure that the
fund meets their investment objectives and needs.
SUMMARY
This summary is qualified in its entirety by reference to the
additional information contained elsewhere in this Prospectus/Proxy
Statement, the Prospectus of Munder Growth Fund and the Fund (Class A, B, and
C shares) dated October 29, 1997, the Prospectus of Munder Growth Fund and
the Fund (Class K shares) dated October 29, 1997, the Prospectus of Munder
Growth Fund and the Fund (Class Y shares) dated October 29, 1997 (copies of
which accompany this Prospectus/Proxy Statement, as applicable), the
Statement of Additional Information of the
-5-
<PAGE>
Fund and Munder Growth Fund, and the Agreement and Plan of Reorganization, a
copy of which is attached to this Prospectus/Proxy Statement as Exhibit A.
Proposed Reorganization
The Plan provides for the transfer of all or substantially all of
the assets of the Fund in exchange for shares of Munder Growth Fund and the
assumption by Munder Growth Fund of certain identified liabilities of the
Fund (as reflected on a balance sheet of the Fund prior to the closing date
of the reorganization). The Plan also calls for the termination of the Fund
and the distribution of shares of Munder Growth Fund to shareholders of the
Fund. (The foregoing proposed transaction is referred to in this
Prospectus/Proxy Statement as the "Reorganization.") As a result of the
Reorganization, each shareholder of the Fund will become the owner of that
number of full and fractional shares of Munder Growth Fund having an
aggregate net asset value equal to the aggregate net asset value of the
shareholder's shares of the Fund as of the close of business on the date that
the Fund's assets are exchanged for shares of Munder Growth Fund (the
"Closing Date"). (Shareholders of Class A Shares, Class B Shares, Class C
Shares, Class K Shares, and Class Y Shares of the Fund will receive Class A
shares, Class B shares, Class C shares, Class K shares, and Class Y shares,
respectively, of Munder Growth Fund.) See "Information About the
Reorganization."
For the reasons set forth below under "Reasons for the
Reorganization," the Trustees of the Trust, including all of the Trustees who
are not "interested persons", as that term is defined in the Investment
Company Act of 1940, as amended (the "1940 Act"), have concluded that the
Reorganization would be in the best interests of the shareholders of the Fund
and that the interests of the Fund's existing shareholders would not be
diluted as a result of the Reorganization, and therefore have submitted the
Plan for approval to the Fund's shareholders. The Trustees of the Trust
recommend approval of the Plan effecting the Reorganization. The Board of
Directors of the Company has also approved the Reorganization on behalf of
Munder Growth Fund.
Approval of the Reorganization will require the affirmative vote
of the holders of a majority of the outstanding shares of the Fund with all
classes voting together and not by class. See "Voting Information."
Investment Objectives, Policies and Restrictions
The Fund and Munder Growth Fund have generally similar investment
objectives, policies and restrictions. The primary investment objective of
the Fund is to provide long-term capital appreciation; income is a secondary
objective. The Fund seeks to achieve these objectives by investing primarily
in equity securities of companies that have demonstrated the potential for
accelerated earnings growth, the maintenance of a substantial competitive
advantage, a focused management team and a stable balance sheet. The
investment objective of Munder Growth Fund is to provide long-term capital
appreciation. It seeks to achieve this objective by investing primarily in a
diversified portfolio of equity securities of companies that have
demonstrated superior, long-term earnings growth, financial stability,
attractive valuation, and relative price momentum.
-6-
<PAGE>
Although the respective investment objectives of the Fund and
Munder Growth Fund are generally similar, shareholders of the Fund should
consider certain differences in the investment policies of, and portfolio
securities held by, each fund. See "Comparison of Investment Objectives and
Policies."
Summary Comparison of Fees and Expenses
The following tables compare the fees and expenses of the Fund and
Munder Growth Fund and show the estimated fees and expenses on a pro forma
basis, giving effect to the proposed Reorganization. Additional information
regarding the performance of the funds is contained in the Annual Report for
Class A, Class B, Class C, and Class Y shares of the Fund and Munder Growth
Fund for the fiscal year ended June 30, 1998, and the Annual Report for Class
K shares of the Fund and Munder Growth Fund for the fiscal year ended June
30, 1998 (previously provided to Fund Shareholders), which are incorporated
by reference into this Prospectus/Proxy Statement.
<TABLE>
<CAPTION>
Class A Shares
Munder
Growth Fund Fund Pro Forma
----------- ---- ---------
<S> <C> <C> <C>
Shareholder Transaction Expenses:
Maximum Initial Sales Charge (as a
percentage of offering price)..................... 5.50% 5.50% 5.50%
Maximum contingent deferred sales
charge (as a percentage of
redemption proceeds).............................. None (1) None (1) None (1)
Exchange Fee........................................ None None None
Annual Fund Operating Expenses:
(as a percentage of average net assets)
Advisory fee ................................... 0.75%(2) 0.75% 0.75%(3)
12b-1 fees...................................... 0.25% 0.25% 0.25%
Other expenses (after expense reimbursement).... .21 (2) .20 .20 (3)
-------- -------- --------
Total Fund Operating Expenses (after expense
reimbursement)................................. 1.21 (2) 1.20 1.20(3)
</TABLE>
-7-
<PAGE>
<TABLE>
<CAPTION>
Class B Shares
Munder
Growth Fund Fund Pro Forma
----------- ---- ---------
<S> <C> <C> <C>
Shareholder Transaction Expenses:
Maximum Initial Sales Charge (as a
percentage of offering price).................. None None None
Maximum contingent deferred sales
charge (as a percentage of
redemption proceeds)........................... 5.00% 5.00% 5.00%
Exchange Fee........................................ None None None
Annual Fund Operating Expenses:
(as a percentage of average net assets)
Advisory fee .................................. 0.75%(2) 0.75% 0.75%(3)
12b-1 fees..................................... 1.00% 1.00% 1.00%
Other expenses (after expense reimbursement)... .21 (2) .20 .20 (3)
------- ---- -------
Total Fund Operating Expenses (after expense
reimbursement)............................... 1.96 (2) 1.95 1.95 (3)
</TABLE>
<TABLE>
<CAPTION>
Class C Shares
Munder
Growth Fund Fund Pro Forma
----------- ---- ---------
<S> <C> <C> <C>
Shareholder Transaction Expenses:
Maximum Initial Sales Charge (as a
percentage of offering price).................. None None None
Maximum contingent deferred sales charge (as a
percentage of redemption proceeds)............. 1.00%(4) 1.00%(4) 1.00%(4)
Exchange Fee........................................ None None None
Annual Fund Operating Expenses:
(as a percentage of average net assets)
Advisory fee .................................. 0.75%(2) 0.75% 0.75%(3)
12b-1 fees..................................... 1.00% 1.00% 1.00%
Other expenses (after expense reimbursement)... .21 (2) .20 .20 (3)
------- ---- -------
Total Fund Operating Expenses (after expense
reimbursement).............................. 1.96 (2) 1.95 1.95 (3)
</TABLE>
-8-
<PAGE>
<TABLE>
<CAPTION>
Class K Shares
Munder
Growth Fund Fund Pro Forma
----------- ---- ---------
<S> <C> <C> <C>
Shareholder Transaction Expenses:
Maximum Initial Sales Charge (as a
percentage of offering price).................. None None None
Maximum contingent deferred sales
charge (as a percentage of
redemption proceeds)........................... None None None
Exchange Fee........................................ None None None
Annual Fund Operating Expenses:
(as a percentage of average net assets)
Advisory fee .................................. 0.75%(2) 0.75% 0.75%(3)
12b-1 fees..................................... None None None
Shareholder servicing fee ..................... 0.25% 0.25% 0.25%
Other expenses (after expense reimbursement)... .21 (2) .20 .20 (3)
------- ---- -------
Total Fund Operating Expenses (after expense
reimbursement)............................... 1.21 (2) 1.20 1.20 (3)
</TABLE>
<TABLE>
<CAPTION>
Class Y Shares
Munder
Growth Fund Fund Pro Forma
----------- ---- ---------
<S> <C> <C> <C>
Shareholder Transaction Expenses:
Maximum Initial Sales Charge (as a
percentage of offering price).................. None None None
Maximum contingent deferred sales charge (as a
percentage of redemption proceeds)............. None None None
Exchange Fee........................................ None None None
Annual Fund Operating Expenses:
(as a percentage of average net assets)
Advisory fee .................................. 0.75%(2) 0.75% 0.75%(3)
12b-1 fees..................................... None None None
Other expenses (after expense reimbursement)... .21 (2) .20 .20 (3)
------- ---- -------
Total Fund Operating Expenses (after expense
reimbursement).............................. .96 (2) .95 .95 (3)
<FN>
- ----------------
(1) Investments of $1 million or more in Class A shares of the Fund or
Munder Growth Fund are not subject to an initial sales charge; however,
a CDSC of 1% is imposed in the event of certain redemption transactions
within one year following such investments. A CDSC on Class A shares of
Munder Growth Fund acquired by holders of Class A Shares of the Fund
pursuant to the Reorganization will only be imposed on redemptions on
which a CDSC would have applied to the Class A Shares of the Fund.
(2) Munder Capital Management expects to voluntarily waive a portion of
its advisory fee for the current fiscal year. Without waivers, the
advisory fees as a percentage of average net assets would be .93% and
total fund operating expenses would be 1.39% for Class A, 2.14% for
Class B, 2.14% for Class C, 1.39% for Class K and 1.14% for Class Y.
(3) After the Reorganization, Munder Capital Management has agreed to waive
its advisory fee and/or reimburse Munder Growth Fund for expenses until
at least June 30, 2000 so that the expense ratios of each
-9-
<PAGE>
class of Munder Growth Fund will not exceed the expense ratios of the
corresponding classes of the Fund as of the Fund's most recent fiscal
year ended June 30, 1998. In the absence of this waiver, the advisory
fee would be .93% for each class; and, based on the pro forma combined
assets of the Fund and the Munder Growth Fund as of December 31, 1997,
pro forma total fund operating expenses would be 1.38% for Class A
shares, 2.13% for Class B shares, 2.13% for Class C shares, 1.38% for
Class K shares, and 1.13% for Class Y shares.
(4) If redeemed within one year of purchase.
</TABLE>
EXAMPLE
This example shows the amount of expenses you would pay (directly
or indirectly) on a $1,000 investment in the Munder Growth Fund and the Fund,
and the pro forma expenses of the Munder Growth Fund following the
Reorganization assuming, in each case, (1) a 5% annual return, (2) redemption
at the end of the time period (including the deduction of the deferred sales
charge, if any) and (3) no redemption at the end of the time period. This
example is not a representation of past or future performance or operating
expenses; actual performance or operating expenses may be larger or smaller
than those shown.
<TABLE>
<CAPTION>
Munder Growth Fund Fund Pro Forma
------------------------------ ----------------------------------- ------------------------------
Class A Class B Class C Class A Class B Class C Class A Class B Class C
Shares Shares Shares Shares Shares Shares Shares Shares Shares
------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year
Redemption ....... $ 67 $ 71 $ 30 $ 67 $ 71 $ 30 $ 67 $ 71 $ 30
No Redemption..... 67 20 20 67 20 20 67 20 20
3 Years
Redemption........ 91 95 62 91 94 61 91 94 61
No Redemption..... 91 62 62 91 61 61 91 61 61
5 Year
Redemption ....... 118 129 106 118 129 105 118 129 105
No Redemption..... 118 106 106 118 105 105 118 105 105
10 Years
Redemption........ 194 229 229 193 228 228 193 228 228
No Redemption..... 194 229 229 193 228 228 193 228 228
</TABLE>
-10-
<PAGE>
<TABLE>
<CAPTION>
Munder Growth Fund Fund Pro Forma
------------------------ ------------------------- ------------------------
Class K Class Y Class K Class Y Class K Class Y
Shares Shares Shares Shares Shares Shares
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
1 Year
Redemption ........... $12 $ 10 $ 12 $ 10 $ 12 $ 10
No Redemption......... 12 10 12 10 12 10
3 Years
Redemption............ 38 31 38 30 38 30
No Redemption......... 38 31 38 30 38 30
5 Year
Redemption ........... 67 53 66 53 66 53
No Redemption......... 67 53 66 53 66 53
10 Years
Redemption............ 147 118 146 117 146 117
No Redemption......... 147 118 146 117 146 1 17
</TABLE>
Purchase and Redemption Procedures
The following discussion describes differences in the minimum
investment requirements, charges, and waivers of charges applicable to the
various classes of the Fund and Munder Growth Fund. For details on how to
purchase or redeem shares of either fund, see the Prospectus. Both Munder
Growth Fund and the Fund reserve the right to involuntarily redeem an
investor's Class A, Class B or Class C shares if the net asset value of such
shares is less than $500 by reason of redemption.
Class A Shares. The minimum initial investment for Class A shares
of Munder Growth Fund and the Fund is $250 ($50 for shares purchased through
an Automatic Investment Plan) and subsequent investments must be at least
$50.
Class A shares of Munder Growth Fund and the Fund are sold to
investors at net asset value plus an initial sales charge at a maximum rate
of 5.5% of the offering price. No initial sales charge will be imposed on the
Class A shares of Munder Growth Fund received by holders of the Fund's Class
A Shares in the Reorganization.
The following table shows the initial sales charge schedule for
Class A shares of Munder Growth Fund and Class A Shares of the Fund.
-11-
<PAGE>
<TABLE>
<CAPTION>
Sales Charge as a
Percentage of
----------------------- Discount to
Net Amount Selected
Invested Dealers as a
Offering (Net Asset Percentage of
Amount of Purchase Price Value) Offering Price
------------------ ----- ------ --------------
<S> <C> <C> <C>
Less than $25,000 5.50% 5.82% 5.00%
$25,000 but less than $50,000 5.25% 5.54% 4.75%
$50,000 but less than $100,000 4.50% 4.71% 4.00%
$100,000 but less than $250,000 3.50% 3.63% 3.25%
$250,000 but less than $500,000 2.50% 2.56% 2.25%
$500,000 but less than $1,000,000 1.50% 1.52% 1.25%
$1,000,000 or more None* None* (see below)**
<FN>
- ---------
* No initial sales charge applies on investments of $1 million or more,
but a contingent deferred sales charge of 1% is imposed on certain
redemptions within one year of purchase.
** A 1% commission will be paid by the distributor to dealers who initiate
and are responsible for purchases of $1 million or more.
</TABLE>
Purchases of Class A shares of any non-money market fund of the
Company, the Trust and The Munder Framlington Funds Trust will be aggregated
in determining the initial sales charge, which may result in a reduced
initial sales charge.
The initial sales charge is currently waived on sales of Class A shares to
the following types of purchasers:
(1) individuals with an investment account or relationship with Munder
Capital Management;
(2) full-time employees and retired employees of Munder Capital
Management, employees of the Funds' service providers and immediate
family members of such persons;
(3) registered broker-dealers that have entered into selling agreements
with Funds Distributor, Inc. (the "Distributor"), for their own
accounts or for retirement plans for their employees or sold to
registered representatives for full-time employees (and their
families) that certify to the Distributor at the time of purchase
that such purchase is for their own account (or for the benefit of
their families);
(4) certain qualified employee benefit plans as described in the
Prospectus;
(5) individuals who reinvest a distribution from a qualified retirement
plan for which Munder Capital Management serves as investment
adviser;
-12-
<PAGE>
(6) individuals who reinvest the proceeds of redemptions from Class Y
Shares of the funds of the Trust, the Company or the Munder
Framlington Funds Trust, within 60 days of redemption;
(7) banks and other financial institutions that have entered into
agreements with the Trust, the Company or the Munder Framlington
Funds Trust to provide shareholder services for customers
("Customers") (including Customers of such banks and other
financial institutions, and the immediate family members of such
Customers);
(8) fee-based financial planners or employee benefit plan consultants
acting for the accounts of their clients;
(9) employer sponsored retirement plans which are administered by
Universal Pensions, Inc. ("UPI Plans"); and
(10) employer sponsored 401(k) plans that are administered by Merrill
Lynch Group Employee Services ("Merrill Lynch Plans") which meet
certain criteria described in the Prospectus.
The sales charges on Class A shares of Munder Growth Fund and the
Fund may be reduced through a letter of intent, quantity discounts and the
right of accumulation, as described in the Prospectus.
Both Class A Shares of the Fund and Class A shares of Munder
Growth Fund may be redeemed without the imposition of a contingent deferred
sales charge ("CDSC"), except where such shares were purchased without an
initial sales load and redeemed under the following circumstances: a CDSC of
1% applies to certain redemptions of Class A shares of Munder Growth Fund or
the Fund that were purchased without a sales charge by reason of a purchase
of $1 million or more, if such redemptions are made within the first year
after investing. For purposes of determining whether a CDSC applies, the
holding period of Class A shares of Munder Growth Fund acquired by holders of
Class A Shares of the Fund through the Reorganization will be calculated from
the date that the Class A Shares of the Fund were initially acquired. A CDSC
on Class A shares of Munder Growth Fund acquired by holders of Class A Shares
of the Fund pursuant to the Reorganization will only be imposed on
redemptions on which a CDSC would have applied to the Class A Shares of the
Fund. The CDSC applicable to Class A shares is waived for certain
redemptions, as described in the Prospectus.
Class B Shares. The minimum initial investment for Class B shares
of the Fund and Munder Growth Fund is $250 ($50 for shares purchased through
an Automatic Investment Plan) and subsequent investments must be at least
$50.
-13-
<PAGE>
Class B shares of Munder Growth Fund and the Fund are sold without
an initial sales charge, but are subject to a CDSC upon certain redemptions
and are subject to higher ongoing expenses than Class A shares. Class B
shares automatically convert to Class A shares approximately six years after
issuance subject to receipt of certain tax rulings or opinions.
Class B shares of Munder Growth Fund and the Fund that are
redeemed within six years of purchase will be subject to a CDSC calculated by
multiplying the lesser of the original purchase price or the net asset value
of such shares at the time of redemption by the applicable percentage shown
in the table below:
<TABLE>
<CAPTION>
Contingent Deferred
Sales Charge as
a Percentage of
Year Since Dollar Amount
Purchase Subject to Charge
-------- -----------------
<S> <C>
First 5%
Second 4%
Third 3%
Fourth 3%
Fifth 2%
Sixth 1%
Seventh and 0%
Thereafter
</TABLE>
The holding period of Class B shares of Munder Growth Fund
acquired through the Reorganization by holders of Class B Shares of the Fund
will be calculated from the date that the Class B Shares of the Fund were
initially acquired.
The CDSC is waived on redemptions of shares purchased after June
27, 1995 for: (1) redemptions made within one year after the death of a
shareholder or registered joint owner; (2) minimum required distributions
made from an IRA or other retirement plan account after you reach age 70 1/2;
and (3) involuntary redemptions made by the Fund. Additional CDSC waivers are
described in the prospectus. CDSC Waivers on Class B shares purchased before
June 27, 1995 are described in the Statement of Additional Information.
Class C Shares. The minimum investment for Class C shares of the
Fund and Munder Growth Fund is $250 ($50 for shares purchased through an
Automatic Investment Plan) and subsequent investments must be at least $50.
Class C shares are sold without an initial or a contingent deferred sales
charge, except for a CDSC of 1% for redemptions made within the first year
after investing. The CDSC applicable to Class C Shares is waived for certain
redemptions, as described in the Prospectus.
Class K Shares. Class K Shares of Munder Growth Fund and the Fund
are sold without a sales load to customers of banks and other institutions
that have entered into agreements with the funds providing for shareholder
services for their customers. Customers may include
-14-
<PAGE>
individuals, trusts, partnerships and corporations. No CDSC is imposed upon
redemption of Class K shares.
Class Y Shares. Class Y shares of the Fund and Munder Growth Fund
are sold without a sales load to: (1) fiduciary and discretionary accounts of
institutions; (2) institutional investors (including banks, savings
institutions, credit unions and other financial institutions, pension, profit
sharing and employee benefit plans and trusts, insurance companies,
investment companies, investment advisers and broker-dealers acting either
for their own accounts or for the accounts of institutional investors); (3)
directors, trustees, officers and employees of the Trust, the Company, The
Munder Framlington Funds Trust, Munder Capital Management and the
Distributor; (4) investment advisory clients, and (5) family members of
employees of the Munder Capital Management.
The minimum initial investment by fiduciary and discretionary
accounts of institutions and institutional investors for Class Y shares of
the Fund and Munder Growth Fund is $500,000. Other types of investors are not
subject to any minimum required investment.
Exchange Privileges
Shareholders of Munder Growth Fund may exchange shares of each
class for shares of the same class in other funds of the Company, the Trust
and the Munder Framlington Funds Trust to the extent the class exists and
shares are offered for sale in the shareholder's state of residence and
subject to any applicable sales charge. No exchange fee will be imposed on
any of these exchange privileges. Any exchange will be a taxable event for
which a shareholder may have to recognize a gain or loss under federal income
tax provisions. Munder Growth Fund reserves the right to amend or terminate
the exchange privilege after providing notice to shareholders. See
"Exchanges" in the accompanying Prospectuses of Munder Growth Fund.
Dividends
Munder Growth Fund intends to distribute at least annually
substantially all of its investment income to shareholders. Net realized
capital gains, if any, will be distributed at least annually to shareholders.
All dividends and distributions will be reinvested automatically in
additional shares of Munder Growth Fund at net asset value, without a sales
charge or CDSC, unless the shareholder elects to be paid in cash. Fund
shareholders that have elected to receive distributions in cash will continue
to receive distributions in such manner from Munder Growth Fund. See
"Dividends and Distributions" in the accompanying Prospectus of Munder Growth
Fund.
The Fund declares and pays dividends from net investment income,
if any, quarterly, and distributes net realized capital gains, if any, at
least annually. Distributions are paid in additional shares of the same class
of the Fund, unless a shareholder requests to be paid in cash.
-15-
<PAGE>
Tax Consequences
Prior to completion of the Reorganization, the Fund will have
received from counsel an opinion to the effect that the Reorganization will
qualify as a tax-free reorganization for Federal income tax purposes. See
"Information about the Reorganization - Federal Income Tax Consequences."
Shareholder Voting Rights
Neither Munder Growth Fund, a series of a Maryland corporation,
nor the Fund, a series of a Massachusetts business trust, holds annual
shareholder meetings. The 1940 Act requires that a shareholder meeting be
called for the purpose of electing Directors/Trustees at such time as fewer
than a majority of Directors/Trustees holding office have been elected by
shareholders. Either fund will hold a shareholder meeting upon the written
request of shareholders holding at least 10% of that fund's outstanding
shares. See "Comparative Information on Shareholders' Rights - Voting
Rights."
Appraisal Rights
Under the laws of the State of Maryland, shareholders of Munder
Growth Fund do not have appraisal rights in connection with a combination or
acquisition of the assets of another fund. Under the laws of the Commonwealth
of Massachusetts and the Trust's Declaration of Trust, shareholders of the
Fund do not have appraisal rights in connection with a combination or
acquisition of the assets of the Fund by another entity.
Risk Factors
Because Munder Growth Fund and the Fund have generally similar
investment objectives and investment policies, they are subject to similar
investment risks. These risks include those that are generally associated
with investing in equity securities. See "Comparison of Investment Objectives
and Policies" herein and "Fund Choices - Multi-Season Growth Fund" in the
accompanying Prospectus of Munder Growth Fund.
REASONS FOR THE REORGANIZATION
Currently, the Fund and Munder Growth Fund are investment
portfolios of separate mutual fund companies. Although the funds have
substantially similar investment objectives, policies and restrictions, each
must separately bear the costs of its operations. Consolidating their
separate operations should generally benefit the shareholders of the funds by
promoting more efficient operations on a more cost-effective basis. Also,
combining assets of the funds should create future economies of scale
resulting from the larger asset base of the combined fund after the
Reorganization. However, there can be no assurance that the combination of
the funds will produce more efficient operations on a cost-effective basis or
that economies of scale will be realized. Because of the similarities between
the funds, the considerations and risks involved with an investment in Munder
Growth Fund are expected to be comparable to those associated with an
investment in the Fund.
-16-
<PAGE>
In addition, the funds now have a common investment adviser,
Munder Capital Management, a common distributor, Funds Distributor, Inc. and
a common administrator, State Street Bank and Trust Company. Munder Capital
Management became the investment adviser to the Fund and Munder Growth Fund
upon the consolidation of the investment advisory businesses of Woodbridge
Capital Management, Inc. (a subsidiary of Comerica Bank, and the Fund's
former investment adviser), Munder Capital Management, Inc. (Munder Growth
Fund's former investment adviser), and another investment advisory subsidiary
of Comerica Bank. In addition, in connection with that transaction, the
Distributor, which already served as the Fund's distributor, became the
distributor for Munder Growth Fund. Since the two funds have similar
investment objectives, Munder Capital Management also asserted that it would
be useful to combine the assets of the two funds in an effort to better
coordinate their marketing efforts. Munder Capital Management also indicated
that certain investment management efficiencies and other benefits could be
realized through the combination of the funds.
The Reorganization, therefore, would permit each fund's
shareholders to pursue substantially the same investment goals in a larger
fund. A larger fund should enhance the ability of Munder Capital Management
to effect portfolio transactions on more favorable terms and give Munder
Capital Management greater investment flexibility and the ability to select a
larger number of portfolio securities with the attendant benefits of
increased diversification. A larger fund should not be as significantly
affected by high levels of shareholder redemptions. In addition, the larger
aggregate net assets should enable the combined entity to obtain the benefits
of economies of scale, permitting the reduction of certain costs and expenses
which may result in lower overall expense ratios through the spreading of
fixed costs of operations over a larger asset base. As a general rule,
economies of scale can be expected to be realized with respect to fixed
expenses, such as costs of printing and fees for professional services,
although expenses that are based on the value of assets or the number of
shareholder accounts, such as custody fees, would be largely unaffected by
the Reorganization. Moreover, there can be no assurance that economies of
scale can be realized. Since the total per share operating expenses of Munder
Growth Fund before fee waivers and reimbursements are higher than those of
the Fund, Munder Capital Management has agreed to waive its fees and/or
reimburse Munder Growth Fund for expenses until at least June 30, 2000, so
that the expense ratio of Munder Growth Fund will not exceed that of the Fund
as of its most recent fiscal year ended June 30, 1998.
In light of the foregoing considerations, the Trustees of the
Trust unanimously concluded that the Reorganization is in the best interests
of the Fund and its shareholders and that the Reorganization would not result
in a dilution of shareholders' interests.
Upon consideration of the factors described above, the Board of
Directors of the Company also approved the Reorganization and determined that
it is in the best interests of Munder Growth Fund and its shareholders to
acquire the assets of the Fund, and that the interests of Munder Growth
Fund's shareholders would not be diluted as a result of the Reorganization.
-17-
<PAGE>
INFORMATION ABOUT THE REORGANIZATION
Plan of Reorganization
The following summary of the Plan is qualified in its entirety by
reference to the Plan which is attached as Exhibit A hereto. The Plan
provides that (1) Munder Growth Fund will acquire all or substantially all of
the assets of the Fund in exchange for shares of Munder Growth Fund, (2)
Munder Growth Fund will assume certain identified liabilities of the Fund on
the Closing Date for the transaction, (3) the Fund will be terminated in
accordance with the terms of the Plan and Declaration of Trust of the Trust,
(4) all remaining liabilities of the Fund will be satisfied whether by
payment or the making of reasonable provision for payment thereof, and (5)
Munder Growth Fund shares will be distributed to shareholders of the Fund.
Prior to the Closing Date, the Fund will endeavor to discharge all of its
known liabilities and obligations. Munder Growth Fund will not assume any
liabilities or obligations of the Fund other than those reflected in an
unaudited statement of assets and liabilities of the Fund prepared as of the
close of regular trading on the New York Stock Exchange, Inc. (the "NYSE"),
currently 4:00 p.m. New York time, on the Closing Date. The number of full
and fractional Class A shares, Class B shares, Class C shares, Class K, and
Class Y shares of Munder Growth Fund to be issued to the Fund shareholders
will be determined on the basis of the relative net asset values of each
class of shares of Munder Growth Fund and the Fund, computed as of the close
of regular trading on the NYSE on the Closing Date. The net asset value per
share for each class will be determined by dividing assets attributable to
the class, less liabilities, by the total number of outstanding shares of the
class.
Both the Fund and Munder Growth Fund will utilize State Street
Bank and Trust Company as agent to determine the value of their respective
portfolio securities. The Fund and Munder Growth Fund also will use the same
independent pricing services to determine the value of each security so that
State Street Bank and Trust Company, as agent, can determine the aggregate
value of each fund's portfolio. The method of valuation employed will be as
set forth in the funds' Prospectuses which is consistent with Rule 22c-1
under the 1940 Act and with the interpretations of such rule by the SEC's
Division of Investment Management.
As soon after the Closing Date as conveniently practicable, the
Fund will liquidate and will distribute pro rata to shareholders of record as
of the close of business on the Closing Date the full and fractional shares
of Munder Growth Fund received by the Fund. Such distribution will be
accomplished by the establishment of accounts in the names of the Fund's
shareholders on the share records of Munder Growth Fund's transfer agent.
Each account will represent the respective pro rata number of full and
fractional shares of Munder Growth Fund due to the Fund's respective
shareholders. After such distribution and the winding up of its affairs, the
Fund will be terminated.
The consummation of the Reorganization is subject to the
conditions set forth in the Plan. Notwithstanding approval of the Fund's
shareholders, the Plan may be terminated at any time at or prior to the
Closing Date by (1) mutual agreement of the Fund and Munder Growth Fund or
(2) either party to the Plan upon a material breach by the other party of any
representation, warranty or agreement contained therein or the failure to
meet closing conditions.
-18-
<PAGE>
The Fund and Munder Growth Fund shall each be liable for its
respective expenses incurred in connection with entering into and carrying
out the Plan, whether or not the Reorganization is consummated.
Approval of the Plan will require the affirmative vote of a
majority of the outstanding shares of the Fund with all classes voting
together and not by class. If the Reorganization is not approved by
shareholders of the Fund, Munder Capital Management may recommend to the
Trustees of the Trust other possible courses of action for their
consideration. One such possible course of action would be termination of the
Fund and a cash distribution to shareholders of the Fund in liquidation.
Description of Munder Growth Fund's Shares
Full and fractional shares of the respective class of shares of
common stock of Munder Growth Fund will be issued to the Fund's shareholders
in accordance with the procedures detailed in the Plan and as described in
Munder Growth Fund's Prospectus. Generally, Munder Growth Fund does not issue
share certificates to shareholders unless a specific request is submitted to
Munder Growth Fund's transfer agent. The shares of Munder Growth Fund to be
issued to Fund shareholders and registered on the shareholder records of the
transfer agent will have no pre-exemptive or conversion rights. However, six
years after the date of purchase, Class B shares of Munder Growth Fund will
convert automatically to Class A shares, based on the relative net asset
values of shares of each class, and will no longer be subject to a
distribution fee. Holders of Class B Shares of the Fund who receive Class B
shares of Munder Growth Fund pursuant to the Reorganization will convert to
Class A shares of the Munder Growth Fund at the end of six years after the
original date of purchase of the Class B shares of the Fund, based on the
relative net asset values of Class A and Class B shares of Munder Growth
Fund. See "Comparative Information on Shareholders' Rights" and Munder Growth
Fund's Prospectus for additional information with respect to the shares of
Munder Growth Fund.
Federal Income Tax Consequences
The Reorganization is intended to qualify for federal income tax
purposes as a tax-free reorganization described in Section 368(a) of the
Internal Revenue Code of 1986, as amended ("Code"), with no gain or loss
recognized as a consequence of the Reorganization by Munder Growth Fund, the
Fund, or the shareholders of the Fund. As a condition to the closing of the
Reorganization, Munder Growth Fund and the Fund will receive an opinion from
the law firm of Dechert Price & Rhoads to that effect. That opinion will be
based upon certain assumptions and representations made by the Fund and
Munder Growth Fund.
Shareholders of the Fund should consult their tax advisers
regarding the effect, if any, of the proposed Reorganization in light of
their individual circumstances. Since the foregoing discussion only relates
to the federal income tax consequences of the Reorganization, shareholders of
the Fund should also consult their tax advisers as to state and other local
tax consequences, if any, of the Reorganization.
-19-
<PAGE>
Capitalization
The following table shows the capitalization of Munder Growth Fund
and the Fund as of June 30, 1998, and on a pro forma basis as of that date,
giving effect to the proposed acquisition of assets at net asset value.
<TABLE>
<CAPTION>
As of June 30, 1998
------------------------------------------------------------
Munder Growth Pro Forma for
CLASS A SHARES The Fund Fund Reorganization
- -------------- -------- -------------- --------------
<S> <C> <C> <C>
Net Assets.......................... $14,110,355 $32,311,247 $46,421,602
Net asset value per share........... $12.22 $21.46 $21.46
Shares outstanding.................. 1,154,776 1,505,545 2,163,064
<CAPTION>
As of June 30, 1998
------------------------------------------------------------
Munder Growth Pro Forma for
CLASS A SHARES The Fund Fund Reorganization
- -------------- -------- -------------- --------------
<S> <C> <C> <C>
Net Assets.......................... $1,197,417 $102,699,777 $103,897,194
Net asset value per share........... $11.58 $20.70 $20.70
Shares outstanding.................. 103,424 4,962,318 5,020,164
<CAPTION>
As of June 30, 1998
------------------------------------------------------------
Munder Growth Pro Forma for
CLASS A SHARES The Fund Fund Reorganization
- -------------- -------- -------------- --------------
<S> <C> <C> <C>
Net Assets.......................... $110,123 $14,411,244 $14,521,367
Net asset value per share........... $11.74 $20.73 $20.73
Shares outstanding.................. 9,379 695,330 700,642
<CAPTION>
As of June 30, 1998
------------------------------------------------------------
Munder Growth Pro Forma for
CLASS A SHARES The Fund Fund Reorganization
- -------------- -------- -------------- --------------
<S> <C> <C> <C>
Net Assets.......................... $67,694,743 $275,378,271 $343,073,014
Net asset value per share........... $12.08 $21.42 $21.42
Shares outstanding.................. 5,603,077 12,857,426 16,017,778
-20-
<PAGE>
<CAPTION>
As of June 30, 1998
------------------------------------------------------------
Munder Growth Pro Forma for
CLASS A SHARES The Fund Fund Reorganization
- -------------- -------- -------------- --------------
<S> <C> <C> <C>
Net Assets.......................... $72,515,875 $332,156,307 $404,672,182
Net asset value per share........... $12.26 $21.66 $21.66
Shares outstanding.................. 5,912,736 15,332,572 18,680,489
</TABLE>
COMPARISON OF INVESTMENT OBJECTIVES AND POLICIES
The following discussion comparing investment objectives, policies
and restrictions of the Fund and Munder Growth Fund is based upon and
qualified in its entirety by the respective investment objectives, policies
and restrictions sections of the Prospectuses of the Fund and Munder Growth
Fund. For a more detailed discussion of the investment objectives, policies
and restrictions of the Fund and Munder Growth Fund, refer to the
Prospectuses, under the caption "Fund Choices," and to the Statement of
Additional Information for the Fund and Munder Growth Fund under the captions
"Fund Investments" and "Investment Limitations."
Investment Objectives
The primary investment objective of the Fund is to provide
long-term capital appreciation; income is a secondary objective. The
investment objective of Munder Growth Fund is to provide long-term capital
appreciation. The Fund's investment objectives may be changed by the Trust's
Board of Trustees without shareholder approval; however, shareholders are
notified of any such change. Munder Growth Fund's investment objective is a
fundamental policy and may not be changed without the authorization of the
holders of a majority of the outstanding voting securities (as defined in the
1940 Act) of Munder Growth Fund.
Primary Investments
The Fund primarily invests in a diversified portfolio of equity
securities of companies that have demonstrated the potential for accelerated
earnings growth, the maintenance of substantial competitive advantage, a
focused management team and a stable balance sheet.
Munder Growth Fund primarily invests in a diversified portfolio of
equity securities of companies that have demonstrated superior long-term
earnings growth, financial stability, attractive valuation and relative price
momentum. Income is not a primary consideration in the selection of
investments. This style, which incorporates both growth investing and value
constraints, has been recognized in the investment management community as
GARP (Growth at a Reasonable Price) and seeks to produce attractive returns
during various market environments
-21-
<PAGE>
Under normal market conditions, at least 65% of each fund's total
assets will be invested in equity securities. Equity securities include
common and preferred stocks and securities convertible into or exchangeable
for common stocks, such as convertible preferred stocks, convertible
debentures or warrants. No more than 25% of the total assets of either fund
may be invested in securities of issuers in the same industry. Neither fund
may purchase more than 10% of the outstanding voting securities of any
issuer, except that up to 25% of a fund's total assets may be invested
without regard to this limitation.
Portfolio Instruments and Practices
Borrowing. Under certain circumstances, each fund may borrow money
in an amount up to 5% of the value of its total assets for temporary purposes
and in an amount equal to one-third of its assets to meet redemptions. This
is a fundamental policy which can only be changed by shareholders. Whenever
borrowings exceed 5% of either fund's total assets, that fund will not make
any additional investments.
Lending. Each fund may lend securities in its portfolio
representing up to 25% of total assets, taken at market value, to securities
firms and financial institutions, provided that each loan is secured
continuously by collateral in the form of cash or liquid securities with
market value at least equal (on a daily mark-to-market basis) to the current
market value of the securities loaned.
Foreign Securities. Each fund may invest up to 25% of its total
assets in the equity securities of foreign issuers, including companies
domiciled in developing countries. Munder Growth Fund typically will only
purchase foreign securities that are represented by American Depositary
Receipts ("ADRs") listed on a domestic securities exchange or included in the
NASDAQ National Market System, or foreign securities listed directly on a
domestic securities exchange or included in the NASDAQ National Market
System.
Forward Foreign Currency Exchange Contracts. Each fund may enter
into forward foreign currency exchange contracts. A fund may enter into these
contracts in order to protect against uncertainty in the level of future
exchange rates between a particular foreign currency and the U.S. dollar or
between two foreign currencies in which portfolio securities are or may be
denominated.
Futures Contracts and Options. Each fund may purchase and sell
futures contracts on securities, currencies and indices. Neither fund will
commit more than 5% of its total assets to initial margin deposits on futures
contracts. In addition, each fund may write covered call options, purchase
put options, purchase call options and write secured put options on
securities, currencies, indices and futures contracts. The Fund will write
call options only if they are "covered," as described in the Statement of
Additional Information; Munder Growth Fund may write uncovered call options
for cross-hedging purposes, as described in the Statement of Additional
Information. Munder Growth Fund will limit its investment in uncovered put
and call options to 5% of its total assets, and will not purchase put or call
options if aggregate premiums paid for such options would exceed 20% of its
total assets.
-22-
<PAGE>
Repurchase Agreements, Reverse Repurchase Agreement, and
When-Issued Transactions. Each fund may enter into repurchase agreements with
banks and broker-dealers that have been approved by the directors of the
Company and the trustees of the Trust. Each fund considers repurchase
agreements that mature in more than seven days to be illiquid. Neither fund
may invest more than 15% of its net assets in illiquid securities.
In order to borrow funds for temporary purposes, each fund may
also engage in reverse repurchase agreements, i.e., selling portfolio
securities to financial institutions such as banks and broker/dealers and
agreeing to repurchase them at a mutually specified date and price. In
addition, in order to secure prices deemed advantageous at the time, each
fund may purchase securities on a when-issued or a delayed-delivery basis. A
fund will not enter into a when-issued or delayed-delivery transaction for
speculative purposes but only in furtherance of its investment objective.
Each fund's when-issued or delayed-delivery purchase transactions will not
exceed 25% of the value of the fund's total assets absent unusual market
conditions.
Liquidity Management. In connection with the management of its
daily cash position, each fund may invest in shares of money market funds.
Pending investment, to meet anticipated redemption requests, or as a
temporary defensive measure if Munder Capital Management determines that
market conditions warrant, either fund may also invest without limitation in
high-quality, short-term money market instruments including, among other
things, commercial paper, bankers' acceptances and negotiable certificates of
deposit of banks or savings and loan associations, short-term corporate
obligations and short-term securities issued by, or guaranteed by, the U.S.
Government and its agencies or instrumentalities.
Restricted Securities. Each fund may invest in restricted
securities. Restricted securities are securities subject to legal or
contractual restrictions on their resale.
Portfolio Turnover Rate. Munder Growth Fund intends to purchase
and hold securities for long-term capital appreciation and does not expect to
trade for short-term gain. Accordingly, it is anticipated that Munder Growth
Fund's annual portfolio turnover rate normally will not exceed 50%. The
Fund's portfolio turnover rate for the fiscal year ended June 30, 1998 was
76%. Munder Growth Fund's portfolio turnover rate for the same period was 34%.
Additional Investment Restrictions. In addition to the
restrictions described above, each fund has adopted certain fundamental
investment restrictions that may be changed only with the approval of a
majority of the outstanding securities (as defined in the 1940 Act) of that
fund. These restrictions are set forth in the Statement of Additional
Information for the funds.
COMPARATIVE INFORMATION ON SHAREHOLDERS' RIGHTS
General
Munder Growth Fund is a diversified series of the Company, a
management investment company registered under the 1940 Act, which
continuously offers shares of its series. The Company is a Maryland
corporation and is governed by its Articles of Incorporation, By-laws and
Board of Directors.
-23-
<PAGE>
The Fund is a diversified series of the Trust, an open-end
management investment company registered under the 1940 Act, which
continuously offers shares of its series The Trust is a Massachusetts
business trust and is governed by its Declaration of Trust, Code of
Regulations, and Board of Trustees. Both the Fund and Munder Growth Fund are
also governed by applicable state and Federal law. Certain differences and
similarities between the two funds are summarized below.
Shareholder Liability
The Munder Growth Fund is organized as a series of a Maryland
corporation, and its shareholders generally have no personal liability for
its acts or obligations.
The Fund is organized as a series of a Massachusetts business
trust. Under Massachusetts law, shareholders of a Massachusetts business
trust could, under certain circumstances, be held personally liable for the
obligations of the trust. However, the Trust's Declaration of Trust states
that shareholders shall not be subject to any personal liability in
connection with the assets of the Trust for the acts or obligations of the
Trust. The Declaration of Trust provides for indemnification out of the
assets belonging to the series of the Trust with respect to which such
shareholder's shares are issued, for all losses and expenses of any
shareholder held personally liable for the obligations of the Trust solely by
reason of his or her being or having been a shareholder. Thus, the risk of a
shareholder incurring financial loss on account of shareholder liability is
considered remote since it is limited to circumstances in which a disclaimer
is inoperative and the Fund itself would be unable to meet its obligations.
Voting Rights
Neither the Fund nor Munder Growth Fund holds annual meetings of
shareholders, although each may hold special meetings for purposes of voting
on certain matters as required under the 1940 Act. Special meetings of
shareholders of either fund may be called upon the written request of holders
of not less than 10% of that fund's then outstanding voting securities. On
each matter submitted to a vote of the shareholders of Munder Growth Fund or
the Fund, each shareholder is entitled to one vote for each whole share owned
and a proportionate fractional vote for any fractional share outstanding in
the shareholder's name on the fund's books. Shareholders of all classes of
each fund vote together as a fund, and not by class, except as otherwise
required by applicable law or by that fund's charter documents, or when the
matter affects only the interests of a particular class.
Liquidation or Dissolution
In the event of the liquidation or dissolution of either the Fund
or Munder Growth Fund, the shareholders of that fund are entitled to receive,
when and as declared by the Trustees or Directors, the excess of the assets
over the liabilities belonging to the fund. The assets so distributed to
shareholders of a fund would be distributed among the shareholders in
proportion to the number of shares of that fund held by them and recorded on
the books of the fund.
-24-
<PAGE>
Liability of Directors/Trustees
The By-laws of the Company provide that the Company will indemnify
Directors and Officers of the Company to the fullest extent permitted by
Maryland law and the 1940 Act. The Declaration of Trust of the Trust provides
for similar indemnification of Trustees and officers of the Trust. However,
neither the Declaration of Trust of the Trust nor the By-laws of the Company
purport to protect or indemnify a Director/Trustee or Officer against any
liability to which such person would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such person's office.
Rights of Inspection
Except as required by Maryland law, shareholders of the Munder
Growth Fund have only such right to inspect the records, documents, accounts
and books of Munder Growth Fund as may be granted by the Directors of the
Company. Maryland corporate law provides that one or more persons who
together have owned at least 5% of the outstanding shares of Munder Growth
Fund for at least 6 months may, on written request, inspect during usual
business hours the books of account and stock ledger of Munder Growth Fund.
Shareholders of the Fund generally have the same rights to inspect
the records, accounts and books of the Trust as are permitted shareholders of
a Massachusetts corporation under Massachusetts corporation law. Currently,
each shareholder of a Massachusetts corporation is permitted to inspect the
records, accounts and books of a corporation for any legitimate business
purpose relative to the affairs of the corporation.
The foregoing is only a summary of certain characteristics of the
operations of Munder Growth Fund and the Fund, the Articles of Incorporation
and By-laws of the Company, the Declaration of Trust of the Trust, and
Maryland and Massachusetts law. The foregoing is not a complete description
of the documents cited. Shareholders should refer to the provisions of such
documents and state laws governing each fund for a more thorough description.
INFORMATION ABOUT MANAGEMENT OF MUNDER GROWTH FUND AND THE FUND
Investment Adviser
The current investment adviser of both the Fund and Munder Growth
Fund is Munder Capital Management. Munder Capital Management is a Delaware
general partnership with principal offices at 480 Pierce Street, Birmingham,
Michigan 48009. Munder Capital Management became the investment adviser to
the Fund and Munder Growth Fund upon the consolidation of the investment
advisory businesses of Woodbridge Capital Management, Inc. (a subsidiary of
Comerica Bank, and the Fund's former investment adviser) and Munder Capital
Management, Inc. (Munder Growth Fund's former investment adviser). The
principal partners of Munder Capital Management are Old MCM, Inc., Munder
Group L.L.C., WAM Holdings, Inc. and WAM Holdings II, Inc., a wholly-owned
subsidiary of Comerica Incorporated, which owns or controls approximately 88%
of the interests in Munder Capital Management.
-25-
<PAGE>
As of June 30, 1998, Munder Capital Management and its affiliates
managed over $48 billion of assets for various institutional clients,
including investment companies, pension and profit sharing funds, foundations
and insurance companies, as well as for high net worth individuals. Of this
amount, approximately $25 billion was invested in equity securities.
Munder Growth Fund pays Munder Capital Management a monthly
advisory fee computed at an annual rate of 1.0% of Munder Growth Fund's
average daily net assets up to $500 million, reduced to .75% of Munder Growth
Fund's average daily net assets in excess of $500 million. However, Munder
Capital Management currently waives a portion of its advisory fees so that
Munder Growth Fund pays at an annual rate of 0.75% of average daily net
assets and will continue to do so after the reorganization.
The Fund pays Munder Capital Management a monthly advisory fee
computed at an annual rate of 0.75% of the Fund's daily net assets.
Portfolio Managers
Lee P. Munder and Leonard Barr II serve as portfolio managers to
Munder Growth Fund. Lee P. Munder, CFA, began his investment career in 1969
as Chief Trust Investment Officer for Security Bank and Trust of Southgate,
Michigan. From 1973 to 1985 he served as portfolio manager at Loomis Sayles &
Co., Inc., serving in later years as Vice President and Senior Partner. In
1985, Mr. Munder left Loomis Sayles & Co., Inc. and founded Munder Capital
Management, Inc. Mr. Munder served as President and C.E.O. of Munder Capital
Management or Munder Capital Management, Inc. from Munder Capital Management,
Inc.'s inception until February 1998. Since that time he has served as
chairman of Munder Capital Management.
Leonard Barr II, CFA, began his investment career in 1968 at
Manufacturers National Bank of Detroit. He left Manufacturers in 1985 as
First Vice President and Senior Trust Investment Officer serving as Director
of Research for Trust Investments. Mr. Barr joined Munder Capital Management,
Inc. in 1986 and has been a Director and Senior Vice President of Munder
Capital Management or Munder Capital Management, Inc. since 1988. He serves
as Munder Capital Management's Director of Research. As Director of Research,
Mr. Barr currently approves all equity investments made on behalf of clients
of Munder Capital Management, including Munder Growth Fund.
The Fund is managed by a committee of professional portfolio
managers employed by Munder Capital Management.
Administrator
State Street Bank and Trust Company ("State Street") currently
serves as administrator to both the Fund and Munder Growth Fund.
State Street generally assists the Company, the Trust and the
Munder Framlington Funds Trust in all aspects of their administration and
operations including the maintenance of financial records and fund
accounting. As compensation for its services, State Street is entitled to
receive fees, based on the aggregate daily net assets of the various series
of the Company, the Trust and
-26-
<PAGE>
the Munder Framlington Funds Trust and certain other investment portfolios
that are advised by Munder Capital Management for which it provides services,
computed daily and payable monthly at the annual rate of 0.113% of the first
$2.8 billion of net assets, plus 0.103% of the next $2.2 billion of net
assets, plus 0.101% of the next $2.5 billion of net assets, plus 0.095% of
the next $2.5 billion of net assets, plus 0.080% of the next $2.5 billion of
net assets, plus 0.070% of net assets over $12.5 billion.
State Street has entered into a Sub-Administration Agreement with
the Distributor under which the Distributor provides certain administrative
services with respect to the Fund and Munder Growth Fund. State Street pays
the Distributor a fee for these services out of its own resources at no cost
to the funds.
ADDITIONAL INFORMATION ABOUT MUNDER GROWTH FUND AND THE FUND
Information about the Fund and Munder Growth Fund is included in
the current Prospectus for the Fund and Munder Growth Fund (Class A, B and C
shares) dated October 29, 1997, Prospectus (Class K shares) dated October 29,
1997, Prospectus (Class Y shares) dated October 29, 1997, copies of which
accompany this Proxy Statement/Prospectus, as applicable, and the Statement
of Additional Information dated October 29, 1997, which is available upon
request, and which has been filed with the SEC and is incorporated herein by
reference. A copy of the Statement of Additional Information is available
upon request and without charge by writing or calling the Fund or Munder
Growth Fund at the address or toll-free number listed on the cover page of
this Prospectus/Proxy Statement.
Both the Fund and Munder Growth Fund are subject to the
informational requirements of the Securities Exchange Act of 1934 and in
accordance therewith file reports and other information including proxy
material, reports and charter documents with the SEC. These reports and other
information can be inspected and copied at the SEC Office of Investor
Education & Assistance, at 450 Fifth Street, N.W., Mail Stop 2-13,
Washington, D.C. 20549, http:\\www.sec.gov\[email protected] and at the Midwest
Regional Office of the SEC, 500 West Madison Street, Suite 1400, Chicago, IL
60661, http:\www.sec.gov\[email protected]. Copies of such material can also be
obtained from the SEC Office of Filings and Information Services, Branch of
Document Control, 450 Fifth Street, N.W., Mail Stop 1-4, Washington, D.C.
20549, http:\\www.sec.gov\[email protected] at prescribed rates.
FINANCIAL STATEMENTS AND EXPERTS
The audited financial statements of the Fund as of June 30, 1998
and the audited financial statements for Munder Growth Fund as of June 30,
1998 have been incorporated by reference into this Prospectus/Proxy Statement
in reliance on the reports of Ernst & Young LLP, independent auditors and
independent accountants for the Fund and Munder Growth Fund, given on the
authority of such firm as expert in accounting and auditing. The unaudited
financial statements of the Fund and of Munder Growth Fund as of December 31,
1997 have also been incorporated by reference into the Prospectus/Proxy
Statement.
-27
<PAGE>
LEGAL MATTERS
Certain legal matters concerning the issuance of shares of Munder
Growth Fund will be passed upon by Dechert Price & Rhoads, 1775 Eye Street,
N.W., Washington, D.C. 20006.
The Trustees of the Trust, including the Independent Trustees,
recommend that the Shareholders of the Fund vote FOR approval of the Plan
including the sale of all or substantially all of the Assets of the Fund to
Munder Growth Fund, the Termination of the Fund and the distribution of
Shares of Munder Growth Fund to Shareholders of the Fund, and any properly
executed Proxies without instructions to the contrary will be voted IN FAVOR
of approval of the Plan.
II. APPROVAL OF THE NEW INVESTMENT ADVISORY AGREEMENT
Munder Capital Management ("MCM" or the "Investment Adviser")
currently serves as investment adviser of the Fund pursuant to an Investment
Advisory Agreement between the Investment Adviser and the Trust on behalf of
the Fund dated July 2, 1998. MCM is organized as a Delaware general
partnership. Prior to July 2, 1998, the general partnership interests in MCM
were owned by Old MCM, Inc. (44%), WAM Holdings, Inc. (44%), and Munder Group
L.L.C. (12%). WAM Holdings, Inc. is wholly-owned by Comerica Incorporated.
Mr. Lee P. Munder, Chairman of MCM, owned 83% of Old MCM Inc. (representing a
36% indirect interest in MCM) and 68% of Munder Group L.L.C. (representing an
8% indirect interest in MCM). Mr. Munder, through his ownership interest in
Old MCM, Inc. and Munder Group L.L.C., owned or controlled approximately 44%
of MCM. Employees of MCM owned the remaining 12% of MCM. On July 2, 1998,
Comerica Incorporated, through its subsidiary, WAM Holdings II, Inc.,
purchased 85% of Old MCM, Inc.'s interest in MCM (representing a 37.4%
interest in MCM) and 85% of Mr. Munder's interest in Munder Group L.L.C.
(representing a 6.9% interest in MCM) (the "Transaction"). As a result,
Comerica Incorporated indirectly owns or controls approximately 88% of the
partnership interests in MCM. The Transaction may have constituted an
"assignment" (as defined in the 1940 Act) of the investment advisory
agreement (the "Prior Investment Advisory Agreement"), and therefore
terminated the Prior Investment Advisory Agreement in accordance with its
terms. The Investment Adviser proposed to the Board of Trustees that the
Trust enter into a new investment advisory agreement on behalf of the Fund
with the Investment Adviser to take effect upon the closing of the
Transaction.
At meetings held on April 7 and May 5, 1998, the Board met to
consider the Transaction and its anticipated effect on the Investment
Adviser's organization and investment advisory arrangements for the Fund. The
Trustees, including the Trustees who are not parties to the Prior Investment
Advisory Agreement or the proposed new investment advisory agreement (the
"New Advisory Agreement") or interested persons (as defined in the 1940 Act)
of any such party (the "Independent Trustees"), unanimously approved, subject
to the required shareholder approval described herein, the proposed new
investment advisory agreement with the Investment Adviser, on behalf of the
Fund, and recommended approval of the New Investment Advisory
-28-<PAGE>
Agreement by the Fund's shareholders. A form of the New Investment
Advisory Agreement is attached as Exhibit B.
The Investment Adviser has represented to the Board of Trustees
that the Transaction would not result in any material change to advisory
services provided to the Fund, and that, subject to approval of the New
Investment Advisory Agreement by shareholders, the Transaction was not
expected to materially affect the level or quality of advisory services
provided to the Fund, and that the same personnel who currently render such
services to the Fund would continue to do so after the Transaction.
1940 Act Considerations
Section 15(a) of the 1940 Act prohibits any person from serving as
an investment adviser to a registered investment company except pursuant to a
written contract that has been approved by the shareholders of the company.
Section 15(a) also provides, as did the Prior Investment Advisory Agreement
pursuant to Section 15(a), for the automatic termination of such agreements
upon its assignment. An assignment is deemed to include any change of control
of the investment adviser. In order for the Investment Adviser to continue to
provide investment advisory services to the Fund, therefore, the shareholders
of the Fund must approve the Fund's New Investment Advisory Agreement.
Due to insufficient time to obtain consent of the Fund's
shareholders prior to the closing of the Transaction, the Trust and the
Investment Adviser have obtained an order from the Securities and Exchange
Commission exempting them from compliance with Section 15(a) of the 1940 Act
pending approval of the New Investment Advisory Agreement by the Fund's
shareholders. The order permits the New Investment Advisory Agreement to go
into effect without shareholder approval and allows the Investment Adviser to
collect fees with respect to the Fund at the rates specified in the New
Investment Advisory Agreement commencing on July 2, 1998. Fees paid by the
Fund under the New Investment Advisory Agreement will be held in an
interest-bearing escrow account pending shareholder approval, which, pursuant
to the terms of the order, must be obtained no later than November 30, 1998.
If the shareholders of the Fund do not approve the Fund's New
Investment Advisory Agreement, any amounts held in escrow under the New
Investment Advisory Agreement of the Fund will be returned to the Fund.
In addition, the Trust intends to conform with the provisions of
Section 15(f) of the 1940 Act, which provides, in pertinent part, that an
investment adviser may receive any amount or benefit in connection with a
sale of such investment adviser which results in an assignment of an
investment advisory contract if (1) for a period of three years after the
time of such event, 75% of the members of the board of directors of the
investment company which it advises are not "interested persons" (as defined
in the 1940 Act) of the new or old investment adviser; and (2) there is no
"unfair burden" imposed on the investment company as a result of the
transaction.
-29-
<PAGE>
The New and the Prior Investment Advisory Agreements
The Prior Investment Advisory Agreement for the Fund was approved
by the Board of Trustees on May 5, 1998.
If the New Investment Advisory Agreement is approved by
shareholders, the Investment Adviser would continue to serve as investment
adviser to the Fund. The terms and conditions of the New Investment Advisory
Agreement are identical in all material respects to those of the Prior
Investment Advisory Agreement, with the exception of their effective dates
and termination dates, the escrow arrangements described above. The New
Investment Advisory Agreement, if approved by the vote of the holders of a
majority of the outstanding shares of the Fund, as defined in the 1940 Act
("1940 Act Majority"), will continue in effect for an initial two-year term,
and thereafter from year to year, subject to approval annually by the Board
of Trustees of the Trust or by the vote of a 1940 Act Majority of the
outstanding shares of the Fund, and also, in either event, approval by a
majority of the Trustees who are not parties to the New Investment Advisory
Agreement or interested persons (as defined in the 1940 Act) of any such
party. The New Investment Advisory Agreement may be terminated, without
penalty, on 60 days' written notice by the Board of Trustees or by vote of
holders of a 1940 Act Majority of the Fund's shares or upon 90 days' written
notice by the Investment Adviser. The New Investment Advisory Agreement will
also terminate automatically in the event of its assignment (as defined in
the 1940 Act).
Under the New Investment Advisory Agreement, as under the Prior
Investment Advisory Agreement, the Investment Adviser will furnish continuing
investment supervision to the Fund and will be responsible for the management
of the Fund's portfolio. The responsibility for making decisions to buy, sell
or hold a particular security will rest with the Investment Adviser, subject
to review by the Board of Trustees. The Investment Adviser will furnish
office space, equipment and personnel in connection with the performance of
its investment management responsibilities.
Like the Prior Investment Advisory Agreement, the New Investment
Advisory Agreement provides that the Investment Adviser shall have no
liability to the Fund or any shareholder of the Fund for any error of
judgment, mistake of law, or any loss arising out of any investment or other
act or omission in the performance by the Investment Adviser of its duties
under the agreement, except for any liability, loss or damage resulting from
willful misfeasance, bad faith or gross negligence on the Investment
Adviser's part or reckless disregard of its duties under the agreement.
Advisory Fee
The fees under the New Investment Advisory Agreement are the same
as the fees under the Prior Investment Advisory Agreement for the Fund. Under
the New Investment Advisory Agreement, as under the Prior Investment Advisory
Agreement, the Fund will pay the Investment Adviser a monthly fee at the
annual rate of 0.75% of the Fund's average daily net assets.
-30-
<PAGE>
During the fiscal year ended June 30, 1998, the Growth Fund paid
advisory fees in the amount of $1,451,332, and the Fund paid advisory fees in
the amount of $1,169,411.
Shareholders should refer to Exhibit B for the complete terms of
the New Investment Advisory Agreement.
In the event that shareholders of the Fund do not approve the New
Investment Advisory Agreement for the Fund, the Board of Trustees of the
Trust could seek to obtain for the Fund interim advisory services from the
Investment Adviser or from another advisory organization. Thereafter, the
Board of Trustees would either negotiate a new investment advisory agreement
with an advisory organization selected by the Board or make other appropriate
arrangements, in either event subject to approval by the shareholders of the
Fund.
Information Regarding the Investment Adviser
The Investment Adviser is a Delaware general partnership with
principal offices at 480 Pierce Street, Birmingham, Michigan 48009. The
general partners of the Investment Adviser are WAM Holdings, Inc., WAM
Holdings II, Inc., Old MCM, Inc. and Munder Group, L.L.C. Old MCM, Inc. and
Munder Group, L.L.C. have offices at the same address as the Investment
Adviser. WAM Holdings, Inc. and WAM Holdings II, Inc. have offices at 500
Woodward Avenue, 33rd Floor, Detroit, Michigan 48275-3391 and are
wholly-owned subsidiaries of Comerica Bank which, in turn, is a wholly-owned
subsidiary of Comerica Incorporated, a publicly-held bank holding company.
Employees of the Investment Adviser may acquire partnership interests in the
Investment Adviser from time to time through Munder Group, L.L.C., which was
organized for that purpose.
Banking laws and regulations, including the Glass-Steagall Act as
presently interpreted by the Board of Governors of the Federal Reserve
System, prohibit a bank holding company registered under the Federal Bank
Holding Company Act of 1956 or any bank or non-bank affiliate thereof from
sponsoring, organizing, controlling or distributing the shares of a
registered open-end investment company continuously engaged in the issuance
of its shares, and prohibit banks generally from underwriting securities.
However, a holding company or affiliate, and banks generally, can act as
adviser to an investment company and can purchase shares of an investment
company as agent for and upon the order of customers. The Investment Adviser
believes that it may perform the services contemplated by the New Investment
Advisory Agreement without violating these banking laws or regulations.
However, future changes in legal requirements relating to the permissible
activities of banks and their affiliates, as well as future interpretations
of current requirements, could prevent the Investment Adviser from continuing
to perform investment advisory services for the Fund. If the Investment
Adviser were prohibited from performing investment advisory services for the
Fund, it is expected that the Board of Trustees would select another
qualified firm. Any new advisory agreement would be subject to shareholder
approval.
-31-
<PAGE>
The Evaluation By the Board of Trustees
The Board of Trustees has determined that, by approving the New
Investment Advisory Agreement on behalf of the Fund, the Fund can best assure
itself that services currently provided by the Investment Adviser will
continue to be provided without interruption.
At meetings held on April 7, 1998 and May 5, 1998, the Trustees
considered information with respect to whether the New Investment Advisory
Agreement with the Investment Adviser was in the best interests of the Fund
and its shareholders. The Trustees considered, among other factors,
representations by the Investment Adviser that the Transaction would not
materially affect the investment advisory operations of the Investment
Adviser or the level or quality of advisory services provided to the Fund;
that, subject to Board and shareholder approval, the same personnel at the
Investment Adviser who provide services to the Fund would continue to do so
after the Transaction; that the Fund's advisory fees would not change as a
result of the Transaction; and that the Fund would not be subjected to any
unfair burden as a result of the Transaction. The Trustees also considered
the terms of the Transaction, and the resulting differences in the ownership
and control of the Investment Adviser. The Trustees also considered, as they
have in the past, the nature and quality of services expected to be provided
by the Investment Adviser and information regarding fees, expense rates,
performance and profitability. In evaluating the Investment Adviser's ability
to provide services to the Fund, the Trustees considered information as to
the Investment Adviser's business organization, financial resources and
personnel and other matters, including the continuing interests of Comerica
Incorporated and Mr. Munder and employees in the Investment Adviser.
Based upon its review, the Board of Trustees concluded that the
New Investment Advisory Agreement with the Investment Adviser is reasonable,
fair and in the best interests of the Fund and its shareholders, and that the
fees provided in the New Investment Advisory Agreement are fair and
reasonable in light of the usual and customary charges made by others for
services of the same nature and quality. Accordingly, after consideration of
the above factors, and such other factors and information as it deemed
relevant, the Board of Trustees, including all of the Independent Trustees,
unanimously approved the New Investment Advisory Agreement and voted to
recommend its approval by the Fund's shareholders.
The Board of Trustees recommends that the shareholders of the Fund
vote IN FAVOR OF approval of the New Investment Advisory Agreement. Properly
executed proxies, with no instructions to the contrary, will be voted IN
FAVOR OF the New Investment Advisory Agreement.
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<PAGE>
III. OTHER BUSINESS
The Trustees of the Trust do not intend to present any other
business at the meeting. If, however, any other matters are properly brought
before the meeting, the persons named in the accompanying form of proxy will
vote thereon in accordance with their judgment.
VOTING INFORMATION
This Prospectus/Proxy Statement is furnished in connection with a
solicitation of proxies by the Trustees of the Trust to be used at the
meeting. This Prospectus/Proxy Statement, along with a Notice of the Meeting
and a proxy card, is first being mailed to shareholders of the Fund on or
about November 20, 1998. Only shareholders of record as of the close of
business on the Record Date, September 30, 1998, will be entitled to notice
of, and to vote at, the meeting. The holders of a majority of the shares of
the Fund outstanding at the close of business on the Record Date present in
person or represented by proxy will constitute a quorum for the meeting. If
the enclosed form of proxy is properly executed and returned in time to be
voted at the meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Properly executed proxies without instructions to the contrary will be voted
FOR the proposed Reorganization, FOR the approval of the New Investment
Advisory Agreement, and FOR any other matters deemed appropriate. Abstentions
and broker "non-votes" (that is, proxies from brokers or nominees who do not
have discretionary power), indicating that such persons have not received
instructions from the beneficial owner or other persons entitled to vote
shares, for purposes of determining the presence of a quorum for transacting
business at the meeting, will be treated as shares that are present but which
have not been voted. A proxy may be revoked at any time on or before the
meeting by written notice to the Secretary of the Trust or by attending and
voting at the meeting.
As of the Record Date, Comerica Bank possessed sole or shared
voting or investment power for its customer accounts with respect to 4,108
Class K shares (less than 1% of the Fund's outstanding Class K shares) and
1,799 Class Y shares (96.2% of the Fund's outstanding Class Y shares).
The Trust has been advised by Comerica Bank that it intends to
pass through the vote on the shares to the beneficial owners of such shares
or retain an independent fiduciary to vote the shares on behalf of the
beneficial owners, for which it is shareholder of record.
Lee P. Munder and Terry H. Gardner are administrators of a pension
plan for employees of Munder Capital Management, which as of the record date
owned 17,148 Class Y shares of the Fund, which represented 0.3% of the
outstanding Class Y shares of the Fund.
As of the record date, the 5% shareholders for each class of the
Fund were as follows:
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<PAGE>
<TABLE>
<CAPTION>
Percent of Total
Name and Address of Shareholder Shares outstanding
------------------------------- ------------------
<S> <C>
Class A
Union Bank of California for the exclusive benefit 34.48%
of its customers
PO Box 2969
Saratoga, CA 95070
Class B
MLPF&S for the sole benefit of its customers 35.56%
4800 Deer Lake Drive East 3rd Floor
Jacksonville, Fl 32246-6484
Smith Barney Inc. for the benefit of its clients 9.29%
388 Greenwich Street
New York, NY 10013
Prudential Securities, Inc. FBO 6.83%
Ms. Dana M. Lee
14100 Pike Road
Saratoga, CA 95070
Smith Barney for the benefit of its Clients 6.23%
388 Greenwich Street
New York, NY 10013
Class C
Porter Y. Fisher & Ora L. Fisher 40.83%
JTWROS
Account #2
5815 East Inglewood Street
Mesa, AZ 85205
Ira Buchalter 39.15%
Madelyn Buchalter JTWROS
PO Box 9497
Saint Thomas, VI 00801
MLPF&S for the sole benefit of its customers 19.60%
4800 Deer Lake Drive East 3rd Floor
Jacksonville, FL 32246-6484
</TABLE>
As of the Record Date, the Officers and Trustees of the Trust
beneficially owned as a group less than 1% of the outstanding shares of the
Fund.
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<PAGE>
Approval of the Plan in Proposal I will require the affirmative
vote of a majority of the outstanding shares of the Fund with all classes
voting together and not by class. Approval of the New Investment Advisory
Agreement, as set forth in Proposal II will require a 1940 Act Majority which
means the affirmative vote of the holders of the lesser of either (A) 67% or
more of the Fund's shares present at the meeting if the holders of more than
50% of the outstanding shares of the Fund are present or represented by proxy
or (B) more than 50% of the outstanding shares of the Fund. Shareholders of
the Fund are entitled to one vote for each share. Fractional shares are
entitled to proportional voting rights.
Munder Capital Management has retained First Data Investors
Services Group, Inc. ("First Data") to provide proxy solicitation services
for the Fund. The costs of soliciting proxies in the accompanying form,
including the fees paid to First Data, will be borne by Munder Capital
Management and not the Funds. In addition to solicitation by mail, proxies
may be solicited by Directors/Trustees, officers and regular employees and
agents of the Company, the Trust, the Munder Framlington Funds Trust and St.
Clair Funds, Inc. without compensation. Brokerage firms and others will be
reimbursed for their expenses in forwarding proxy materials to the beneficial
owners and soliciting them to execute proxies.
In the event that sufficient votes to approve the proposed items
are not received by 10:00 a.m. on November 20, 1998, the persons named as
proxies may propose one or more adjournments of the meeting to permit further
solicitation of proxies. In determining whether to adjourn the meeting, the
following factors may be considered: the percentage of votes actually cast,
the percentage of negative votes actually cast, the nature of any further
solicitation and the information to be provided to shareholders with respect
to the reasons for the solicitation. Any such adjournment will require an
affirmative vote by the holders of a majority of the shares present in person
or by proxy and entitled to vote at the meeting. The persons named as proxies
will vote upon such adjournment after consideration of the best interests of
all shareholders of the Fund.
In order to reduce the costs of preparing, printing, and mailing
the proxy materials, the notices to shareholders with more than one account
with the Fund at the same address, and listed under the same social security
number, have been combined. The proxy cards have been coded so that each
shareholder's votes will be counted to all such accounts.
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<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is
made as of this _____ day of __________, 1998, by and between The Munder
Funds, Inc. (the "Company"), a Maryland corporation, on behalf of The Munder
Multi-Season Growth Fund (the "Acquiring Fund"), a separate investment series
of the Company, and Munder Funds Trust (the "Trust"), a Massachusetts
business trust, on behalf of the Munder Accelerating Growth Fund (the
"Acquired Fund") a separate investment series of the Trust.
This Agreement is intended to be and is adopted as a plan of
reorganization and liquidation within the meaning of Section 368(a) of the
United States Internal Revenue Code of 1986, as amended (the "Code"). The
reorganization (the "Reorganization") will consist of the transfer of all or
substantially all of the assets of the Acquired Fund in exchange solely for
Class A, Class B, Class C, Class K and Class Y shares of common stock (the
"Shares") of the Acquiring Fund, the assumption by the Acquiring Fund of
certain identified liabilities of the Acquired Fund, and the distribution of
the Acquiring Fund Shares to the shareholders of the Acquired Fund in
liquidation of the Acquired Fund as provided herein, all upon the terms and
conditions hereinafter set forth in this Agreement.
WHEREAS, the Company and the Trust are registered investment
companies of the management type and the Acquired Fund owns securities that
generally are assets of the character in which the Acquiring Fund is
permitted to invest; and
WHEREAS, the Company is authorized to issue its shares of common
stock in separate series, including the Acquiring Fund, each of which
maintains a separate and distinct portfolio of assets; and
WHEREAS, the Trust is authorized to issue its shares of beneficial
interest in separate series, including the Acquired Fund, each of which
maintains a separate and distinct portfolio of assets; and
WHEREAS, the Board of Trustees of the Trust on behalf of the
Acquired Fund has determined that the exchange of all or substantially all of
the assets of the Acquired Fund for Acquiring Fund Shares and the assumption
of certain identified liabilities of the Acquired Fund by the Acquiring Fund
is in the best interests of the Acquired Fund and its shareholders and that
the interests of the existing shareholders of the Acquired Fund would not be
diluted as a result of this transaction; and
WHEREAS, the Board of Directors of the Company on behalf of the
Acquiring Fund has determined that the exchange of all or substantially all
of the assets of the Acquired Fund for Acquiring Fund Shares and the
assumption of certain identified liabilities of the Acquired Fund by the
Acquiring Fund is in the best interests of the Acquiring Fund and its
shareholders and that the
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interests of the existing shareholders of the Acquiring Fund would not be
diluted as a result of this transaction.
NOW, THEREFORE, in consideration of the premises and of the
covenants and agreements hereinafter set forth, the parties hereto covenant
and agree as follows:
1. TRANSFER OF ALL OR SUBSTANTIALLY ALL OF THE ASSETS OF THE ACQUIRED
FUND IN EXCHANGE FOR ACQUIRING FUND SHARES, THE ASSUMPTION OF
CERTAIN IDENTIFIED ACQUIRED FUND LIABILITIES AND THE LIQUIDATION
OF THE ACQUIRED FUN
1.1 Subject to the terms and conditions herein set forth and on
the basis of the representations and warranties contained herein, the
Acquired Fund agrees to transfer all or substantially all of the Acquired
Fund's assets as set forth in paragraph 1.2 to the Acquiring Fund, and the
Acquiring Fund agrees in exchange therefor: (i) to deliver to the Acquired
Fund the number of Class A Acquiring Fund Shares, including fractional Class
A Acquiring Fund Shares, determined by dividing the value of the Acquired
Fund's net assets attributable to its Class A shares, computed in the manner
and as of the time and date set forth in paragraph 2.1, by the net asset
value of one Acquiring Fund Class A Share computed in the manner and as of
the time and date set forth in paragraph 2.2; (ii) to deliver to the Acquired
Fund the number of Class B Acquiring Fund Shares, including fractional Class
B Acquiring Fund Shares, determined by dividing the value of the Acquired
Fund's net assets attributable to its Class B Shares, computed in the manner
and as of the time and date set forth in paragraph 2.1, by the net asset
value of one Acquiring Fund Class B Share, computed in the manner and as of
the time and date set forth in paragraph 2.2; (iii) to deliver to the
Acquired Fund the number of Class C Acquiring Fund Shares, including
fractional Class C Acquiring Fund Shares, determined by dividing the value of
the Acquired Fund's net assets attributable to its Class C Shares, computed
in the manner and as of the time and date set forth in paragraph 2.1, by the
net asset value of one Acquiring Fund Class C Share, computed in the manner
and as of the time and date set forth in paragraph 2.2; (iv) to deliver to
the Acquired Fund the number of Class K Acquiring Fund shares, including
fractional Class K Acquiring Fund shares, determined by dividing the value of
the Acquired Fund's net assets attributable to its Class K shares, computed
in the manner and as of the time and date set forth in paragraph 2.1, by the
net asset value of one Acquiring Fund Class K share, computed in the manner
and as of the time and date set forth in paragraph 2.2; (v) to deliver to the
Acquired Fund the number of Class Y Acquiring Fund shares, including
fractional Class Y Acquiring Fund Shares, determined by dividing the value of
the Acquired Fund's net assets attributable to its Class Y Shares, computed
in the manner and as of the time and date set forth in paragraph 2.1, by the
net asset value of one Acquiring Fund class Y Share, computed in the manner
and as of the time and date set forth in paragraph 2.2; and (vi) to assume
certain liabilities of the Acquired Fund, as set forth in paragraph 1.3. Such
transactions shall take place at the closing provided for in paragraph 3.1
(the "Closing").
1.2 (a) The assets of the Acquired Fund to be acquired by the
Acquiring Fund shall consist of all or substantially all of the property
including, without limitation, such cash, securities,
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and dividend or interest receivables which are owned by the Acquired Fund and
any deferred or prepaid expenses shown as an asset on the books of the
Acquired Fund on the closing date provided in paragraph 3.1 (the "Closing
Date").
(b) The Acquired Fund has provided the Acquiring Fund with a
list of all of the Acquired Fund's assets as of the date of execution of this
Agreement. The Acquired Fund reserves the right to sell any of these
securities but will not, without the prior approval of the Acquiring Fund,
acquire any additional securities other than securities of the type in which
the Acquiring Fund is permitted to invest. The Acquiring Fund will, within a
reasonable time prior to the Closing Date, furnish the Acquired Fund with a
statement of the Acquiring Fund's investment objectives, policies and
restrictions and a list of the securities, if any, on the Acquired Fund's
list referred to in the first sentence of this paragraph which do not conform
to the Acquiring Fund's investment objectives, policies and restrictions. In
the event that the Acquired Fund holds any investments which the Acquiring
Fund may not hold, the Acquired Fund will dispose of such securities prior to
the Closing Date. In addition, if it is determined that the portfolios of the
Acquired Fund and the Acquiring Fund, when aggregated, would contain
investments exceeding certain percentage limitations imposed upon the
Acquiring Fund with respect to such investments, the Acquired Fund, if
requested by the Acquiring Fund, will dispose of and/or reinvest a sufficient
amount of such investments as may be necessary to avoid violating such
limitations as of the Closing Date.
1.3 The Acquired Fund will endeavor to discharge all the Acquired
Fund's known liabilities and obligations prior to the Closing Date. The
Acquiring Fund shall assume all liabilities, expenses, costs, charges and
reserves reflected on an unaudited statement of assets and liabilities of the
Acquired Fund prepared by State Street Bank and Trust Company, as
administrator of the Acquiring Fund and the Acquired Fund, as of the
Valuation Date (as defined in paragraph 2.1), in accordance with generally
accepted accounting principles consistently applied from the prior audited
period. The Acquiring Fund shall assume only those liabilities of the
Acquired Fund reflected in that unaudited statement of assets and liabilities
and shall not assume any other liabilities not reflected thereon.
1.4 As provided in paragraph 3.4, as soon after the Closing Date
as is conveniently practicable (the "Liquidation Date"), the Acquired Fund
will liquidate and distribute pro rata to the Acquired Fund's shareholders of
record determined as of the close of business on the Closing Date (the
"Acquired Fund Shareholders") the Acquiring Fund Shares it receives pursuant
to paragraph 1.1. Such liquidation and distribution will be accomplished by
the transfer of the Acquiring Fund Shares then credited to the account of the
Acquired Fund on the books of the Acquiring Fund to open accounts on the
share records of the Acquiring Fund in the name of the Acquired Fund's
shareholders and representing the respective pro rata number of the Acquiring
Fund Shares due such shareholders. All issued and outstanding shares of the
Acquired Fund will simultaneously be canceled on the books of the Acquired
Fund. The Acquiring Fund shall not issue certificates representing the
Acquiring Fund Shares in connection with such exchange.
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1.5 Ownership of Acquiring Fund Shares will be shown on the books
of the Acquiring Fund's transfer agent. Shares of the Acquiring Fund will be
issued in the manner described in the Acquiring Fund's current prospectus and
statement of additional information.
1.6 Any reporting responsibility of the Acquired Fund is and shall
remain the responsibility of the Acquired Fund up to and including the
Closing Date and such later dates on which the Acquired Fund is terminated.
2. VALUATION
2.1 The value of the Acquired Fund's assets to be acquired by the
Acquiring Fund hereunder shall be the value of such assets computed as of the
close of regular trading on the New York Stock Exchange, Inc. (the "NYSE") on
the Closing Date (such time and date being hereinafter called the "Valuation
Date"), using the valuation procedures set forth in the Acquiring Fund's then
current prospectus or statement of additional information.
2.2 The net asset value of an Acquiring Fund Share shall be the
net asset value per share computed as of the close of regular trading on the
NYSE on the Valuation Date, using the valuation procedures set forth in the
Acquiring Fund's then current prospectus or statement of additional
information.
2.3 The number of the Acquiring Fund Shares to be issued
(including fractional shares, if any) in exchange for the Acquired Fund's net
assets shall be determined by dividing the value of the net assets of the
Acquired Fund determined using the same valuation procedures referred to in
paragraph 2.1 by the net asset value per share of an Acquiring Fund share
determined in accordance with paragraph 2.2.
2.4 All computations of value shall be made by Munder Capital
Management or the administrator in accordance with their regular practice as
pricing agents for the Acquiring Fund.
2.5 In carrying out the valuations and calculations required in
this section, Class A shares of the Acquiring Fund shall be issued only to
the extent of the value of the assets of the Acquired Fund representing the
pro rata interest of Class A shares of the Acquired Fund. Class B shares of
the Acquiring Fund shall be issued only to the extent of the value of the
assets of the Acquired Fund representing the pro rata interest of Class B
shares of the Acquired Fund. Class C shares of the Acquiring Fund shall be
issued only to the extent of the value of the assets of the Acquired Fund
representing the pro rata interest of Class C shares of the Acquired Fund.
Class K shares of the Acquiring Fund shall be issued only to the extent of
the value of the assets of the Acquired Fund representing the pro rata
interest of Class K shares of the Acquired Fund. Class Y shares of the
Acquiring Fund shall be issued only to the extent of the value of the assets
of the Acquired Fund representing the pro rata interest of Class Y shares of
the Acquired Fund.
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3. CLOSING AND CLOSING DATE
3.1 The Closing Date shall be _____, 1998, or such later date as
the parties may agree to in writing. All acts taking place at the Closing
shall be deemed to take place simultaneously as of the close of business on
the Closing Date unless otherwise provided. The Closing shall be held as of
5:00 p.m., at the offices of Munder Capital Management, 480 Pierce Street,
Birmingham, Michigan 48009, or at such other time and/or place as the parties
may agree.
3.2 State Street Bank and Trust, as sub-custodian for the
Acquiring Fund (the "Custodian"), shall deliver at the Closing a certificate
of an authorized officer stating that the Acquired Fund's portfolio
securities, cash and any other assets shall have been delivered in proper
form to the Acquiring Fund within two business days prior to or on the
Closing Date.
3.3 In the event that on the Valuation Date (a) the NYSE or
another primary trading market for portfolio securities of the Acquiring Fund
or the Acquired Fund shall be closed to trading or trading thereon shall be
restricted or (b) trading or the reporting of trading on the NYSE or
elsewhere shall be disrupted so that accurate appraisal of the value of the
net assets of the Acquiring Fund or the Acquired Fund is impracticable, the
Closing Date shall be postponed until the first business day after the day
when trading shall have been fully resumed and reporting shall have been
restored.
3.4 The Acquired Fund shall deliver at the Closing a list of the
names and addresses of the Acquired Fund's shareholders and the number and
percentage ownership of outstanding Shares owned by each such shareholder
immediately prior to the Closing, certified on behalf of the Company by its
President. The Acquiring Fund shall issue and deliver a confirmation
evidencing the Acquiring Fund Shares to be credited on the Closing Date to
the Secretary of the Acquired Fund or provide evidence satisfactory to the
Acquired Fund that such Acquiring Fund Shares have been credited to the
Acquired Fund's account on the books of the Acquiring Fund. At the Closing,
each party shall deliver to the other such bills of sale, checks,
assignments, share certificates, if any, receipts or other documents as such
other party or its counsel may reasonably request.
4. REPRESENTATIONS AND WARRANTIES
4.1 The Trust and the Acquired Fund represent and
warrant to the Company and the Acquiring Fund as follows:
(a) The Trust is a Massachusetts business trust, duly
organized, validly existing and in good standing under the laws of
the Commonwealth of Massachusetts;
(b) The Trust is a registered investment company
classified as a management company of the open-end type and its
registration with the Securities and Exchange Commission (the
"Commission") as an investment company under the Investment
Company Act of 1940 (the "1940 Act") is in full force and effect;
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(c) The Trust is not, and the execution, delivery and
performance of this Agreement will not result, in a material
violation of its Declaration of Trust or Code of Regulations or of
any agreement, indenture, instrument, contract, lease or other
undertaking to which the Trust or the Acquired Fund is a party or
by which it is bound;
(d) The Trust and the Acquired Fund have no material
contracts or other commitments (other than this Agreement) which
will be terminated with liability prior to the Closing Date;
(e) Except as otherwise disclosed in writing to and
accepted by the Company and the Acquiring Fund, no litigation or
administrative proceeding or investigation of or before any court
or governmental body is presently pending or to its knowledge
threatened against the Trust, the Acquired Fund or any of their
properties or assets (other than that previously disclosed to the
other party to the Agreement) which, if adversely determined,
would materially and adversely affect their financial condition or
the conduct of their business. The Trust and the Acquired Fund
know of no facts which might form the basis for the institution of
such proceedings and are not parties to or subject to the
provisions of any order, decree or judgment of any court or
governmental body which materially and adversely affects their
business or their ability to consummate the transactions herein
contemplated;
(f) The statements of assets and liabilities of the
Acquired Fund for the period ended February 28, 1993, for the
fiscal years ended February 28, 1994 and 1995, for the period
ended June 30, 1995, and for the fiscal years ended June 30, 1996
and 1997, have been audited by Ernst & Young LLP, certified public
accountants, and are in accordance with generally accepted
accounting principles consistently applied, and such statements
(copies of which have been furnished to the Acquiring Fund) fairly
reflect the financial condition of the Acquired Fund as of such
dates, and there are no known contingent liabilities of the
Acquired Fund as of such dates not disclosed therein;
(g) Since June 30, 1997, there has not been any material
adverse change in the Acquired Fund's financial condition, assets,
liabilities or business other than changes occurring in the
ordinary course of business, or any incurrence by the Acquired
Fund of indebtedness maturing more than one year from the date
that such indebtedness was incurred, except as otherwise disclosed
to and accepted by the Acquiring Fund. For the purposes of this
subparagraph (g), a decline in net asset value per share of the
Acquired Fund Shares shall not constitute a material adverse
change;
(h) At the Closing Date, all federal and other tax
returns and reports of the Acquired Fund required by law to have
been filed by such date shall have been filed, and all federal and
other taxes shall have been paid so far as due, or provision shall
have been made for the payment thereof and, to the best of the
Acquired Fund's knowledge, no such return
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or report is currently under audit and no assessment has been
asserted with respect to such returns or reports;
(i) For each taxable year of its operation, the Acquired
Fund has met the requirements of Subchapter M of the Code for
qualification and treatment as a regulated investment company and
has elected to be treated as such;
(j) All issued and outstanding Shares of the Acquired
Fund are, and at the Closing Date will be, duly and validly issued
and outstanding, fully paid and non-assessable. All of the issued
and outstanding Shares of the Acquired Fund will, at the time of
Closing, be held by the persons and in the amounts set forth in
the records of the transfer agent as provided in paragraph 3.4.
The Acquired Fund does not have outstanding any options, warrants
or other rights to subscribe for or purchase any of the Acquired
Fund's Shares, nor is there outstanding any security other than
Class B Shares, convertible into any of the Acquired Fund's
Shares;
(k) At the Closing Date, the Acquired Fund will have
good and marketable title to its assets to be transferred to the
Acquiring Fund pursuant to paragraph 1.2 and full right, power and
authority to sell, assign, transfer and deliver such assets
hereunder and, upon delivery and payment for such assets, the
Acquiring Fund will acquire good and marketable title thereto,
subject to no restrictions on the full transfer thereof, including
such restrictions as might arise under the Securities Act of 1933,
as amended (the "1933 Act"), other than as disclosed to the
Acquiring Fund;
(l) The execution, delivery and performance of this
Agreement will have been duly authorized prior to the Closing Date
by all necessary actions on the part of the Trust's Board of
Trustees, and subject to the approval of the Acquired Fund's
shareholders, this Agreement will constitute a valid and binding
obligation of the Trust and the Acquired Fund, enforceable in
accordance with its terms, subject as to enforcement, to
bankruptcy, insolvency, reorganization, moratorium and other laws
relating to or affecting creditors' rights and to general equity
principles;
(m) The information to be furnished by the Trust and the
Acquired Fund for use in no-action letters, applications for
exemptive orders, registration statements, proxy materials and
other documents which may be necessary in connection with the
transactions contemplated hereby shall be accurate and complete in
all material respects and shall comply in all material respects
with federal securities and other laws and regulations thereunder
applicable thereto;
(n) The proxy statement of the Acquired Fund (the "Proxy
Statement") to be included in the registration statement (the
"Registration Statement") referred to in paragraph 5.7 (other than
information therein that relates to the Acquiring Fund) will, on
the effective date of the Registration Statement and on the
Closing Date, not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or
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necessary to make the statements therein, in light of the
circumstances under which such statements were made, not
materially misleading.
4.2 The Company and the Acquiring Fund represent and
warrant to the Trust and the Acquired Fund as follows:
(a) The Company is a Maryland corporation, duly
organized, validly existing and in good standing under the laws of
the State of Maryland;
(b) The Company is a registered investment company
classified as a management company of the open-end type and its
registration with the Commission as an investment company under
the 1940 Act is in full force and effect;
(c) The current prospectus and statement of additional
information of the Acquiring Fund conform in all material respects
to the applicable requirements of the 1933 Act and the 1940 Act
and the rules and regulations of the Commission thereunder and do
not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances
under which they were made, not materially misleading;
(d) At the Closing Date, the Acquiring Fund will have
good and marketable title to the Acquiring Fund's assets;
(e) The Company is not, and the execution, delivery and
performance of this Agreement will not result, in a material
violation of its Articles of Incorporation or By-Laws or of any
agreement, indenture, instrument, contract, lease or other
undertaking to which the Company or the Acquiring Fund is a party
or by which it is bound;
(f) No material litigation or administrative proceeding
or investigation of or before any court or governmental body is
presently pending or threatened against the Company or the
Acquiring Fund or any of its properties or assets, except as
previously disclosed in writing to the Acquired Fund. The Company
and the Acquiring Fund know of no facts which might form the basis
for the institution of such proceedings and neither is a party to
or subject to the provisions of any order, decree or judgment of
any court or governmental body which materially and adversely
affects its business or its ability to consummate the transactions
contemplated herein;
(g) The statement of assets and liabilities of the
Acquiring Fund for the fiscal year ended December 31, 1993 and
1994 have been audited by Arthur Andersen & Co. LLP, certified
public accountants. The statement of assets and liabilities of the
Acquiring Fund for the period ended June 30, 1995 and for the
fiscal years ended June 30, 1996 and 1997 have been audited by
Ernst & Young LLP, certified public accountants. All such
statements are in accordance with generally accepted accounting
principles, and such statements (copies of which have been
furnished to the Acquired Fund) fairly reflect the
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financial condition of the Acquiring Fund as of such date, and
there are no known contingent liabilities of the Acquiring Fund as
of such dates not disclosed therein;
(h) Since June 30, 1997, there has not been any material
adverse change in the Acquiring Fund's financial condition,
assets, liabilities or business other than changes occurring in
the ordinary course of business, or any incurrence by the
Acquiring Fund of indebtedness maturing more than one year from
the date that such indebtedness was incurred. For the purposes of
this subparagraph (h), a decline in net asset value per share of
the Acquiring Fund Shares shall not constitute a material adverse
change;
(i) At the Closing Date, all federal and other tax
returns and reports of the Acquiring Fund required by law to have
been filed by such date shall have been filed, and all federal and
other taxes shall have been paid so far as due, or provision shall
have been made for the payment thereof and, to the best of the
Acquiring Fund's knowledge, no such return or report is currently
under audit and no assessment has been asserted with respect to
such returns or reports;
(j) For each taxable year of its operation, the
Acquiring Fund has met the requirements of Subchapter M of the
Code for qualification and treatment as a regulated investment
company and has elected to be treated as such and the Acquiring
Fund intends to do so in the future;
(k) At the date hereof, all issued and outstanding
Acquiring Fund Shares are, and at the Closing Date will be, duly
and validly issued and outstanding, fully paid and non-assessable,
with no personal liability attaching to the ownership thereof. The
Acquiring Fund does not have outstanding any options, warrants or
other rights to subscribe for or purchase any Acquiring Fund
Shares, nor is there outstanding any security other than Class B
shares, convertible into any Acquiring Fund Shares;
(l) The execution, delivery and performance of this
Agreement will have been duly authorized prior to the Closing Date
by all necessary actions, if any, on the part of the Company's
Board of Directors, and this Agreement will constitute a valid and
binding obligation of the Company and the Acquiring Fund
enforceable in accordance with its terms, subject as to
enforcement, to bankruptcy, insolvency, reorganization, moratorium
and other laws relating to or affecting creditors' rights and to
general equity principles;
(m) The Acquiring Fund Shares to be issued and delivered
to the Acquired Fund, for the account of the Acquired Fund's
shareholders, pursuant to the terms of this Agreement, will at the
Closing Date have been duly authorized and, when so issued and
delivered, will be duly and validly issued Acquiring Fund Shares,
and will be fully paid and nonassessable with no personal
liability attaching to the ownership thereof;
(n) The information to be furnished by the Acquiring
Fund for use in no-action letters, applications for exemptive
orders, registration statements, proxy materials and other
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documents which may be necessary in connection with the
transactions contemplated hereby shall be accurate and complete in
all material respects and shall comply in all material respects
with federal securities and other laws and regulations applicable
thereto;
(o) The Proxy Statement to be included in the
Registration Statement (only insofar as it relates to the
Acquiring Fund) will, on the effective date of the Registration
Statement and on the Closing Date, not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which such statements
were made, not materially misleading; and
(p) The Acquiring Fund agrees to use all reasonable
efforts to obtain the approvals and authorizations required by the
1933 Act, the 1940 Act and such of the state Blue Sky or
securities laws as it may deem appropriate in order to continue
its operations after the Closing Date.
5. COVENANTS OF THE ACQUIRING FUND, THE COMPANY, THE ACQUIRED FUND
AND THE TRUST
5.1 The Acquiring Fund and the Acquired Fund each will operate its
business in the ordinary course between the date hereof and the Closing Date.
It is understood that such ordinary course of business will include the
declaration and payment of customary dividends and distributions and any
other dividends and distributions deemed advisable.
5.2 The Trust will call a meeting of the Acquired Fund's
shareholders to consider and act upon this Agreement and to take all other
actions necessary to obtain approval of the transactions contemplated herein.
5.3 The Acquired Fund covenants that the Acquiring Fund Shares to
be issued hereunder are not being acquired for the purpose of making any
distribution thereof other than in accordance with the terms of this
Agreement.
5.4 The Trust and the Acquired Fund will assist the Acquiring Fund
in obtaining such information as the Acquiring Fund reasonably requests
concerning the beneficial ownership of the Acquired Fund's Shares.
5.5 Subject to the provisions of this Agreement, the Company, the
Acquiring Fund, the Trust and the Acquired Fund each will take, or cause to
be taken, all action, and do or cause to be done, all things reasonably
necessary, proper or advisable to consummate and make effective the
transactions contemplated by this Agreement.
5.6 As promptly as practicable, but in any case within sixty days
after the Closing Date, the Acquired Fund shall furnish the Acquiring Fund,
in such form as is reasonably satisfactory to the Acquiring Fund, a statement
of the earnings and profits of the Acquired Fund for federal
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income tax purposes which will be carried over to the Acquiring Fund as a
result of Section 381 of the Code, and which will be certified by the Trust's
President or Vice President and its Treasurer.
5.7 The Acquired Fund will provide the Acquiring Fund with
information reasonably necessary for the preparation of a prospectus (the
"Prospectus") which will include the Proxy Statement referred to in paragraph
4.l(n), all to be included in a registration statement on Form N-14 of the
Acquiring Fund (the "Registration Statement"), in compliance with the 1933
Act, the Securities Exchange Act of 1934 (the "1934 Act") and the 1940 Act in
connection with the meeting of the Acquired Fund's shareholders to consider
approval of this Agreement and the transactions contemplated herein.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE TRUST AND THE
ACQUIRED FUND
The obligations of the Trust and the Acquired Fund to consummate
the transactions provided for herein shall be subject, at its election, to
the performance by the Company and the Acquiring Fund of all of the
obligations to be performed by them hereunder on or before the Closing Date
and, in addition thereto, the following further conditions:
6.1 All representations and warranties of the Company and the
Acquiring Fund contained in this Agreement shall be true and correct in all
material respects as of the date hereof and, except as they may be affected
by the transactions contemplated by this Agreement, as of the Closing Date
with the same force and effect as if made on and as of the Closing Date;
6.2 The Company shall have delivered to the Acquired Fund a
certificate executed in its name by its President or Vice President and its
Treasurer or Assistant Treasurer, in a form reasonably satisfactory to the
Acquired Fund and dated as of the Closing Date, to the effect that the
representations and warranties of the Company and the Acquiring Fund made in
this Agreement are true and correct at and as of the Closing Date, except as
they may be affected by the transactions contemplated by this Agreement and
as to such other matters as the Acquired Fund shall reasonably request; and
6.3 The Trust shall have received on the Closing Date a favorable
opinion from Dechert Price & Rhoads, counsel to the Company and the Acquiring
Fund, dated as of the Closing Date, covering the following points:
That (a) the Acquiring Fund is a series of the Company which is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Maryland and has the corporate
power to own all of its properties and assets and to carry on its
business as presently conducted; (b) the Agreement has been duly
authorized, executed and delivered by the Company on behalf of the
Acquiring Fund and, assuming that the Prospectus, Registration
Statement and Proxy Statement comply with the 1933 Act, the 1934
Act and the 1940 Act and the rules and regulations thereunder and,
assuming due authorization, execution and delivery of the
Agreement by the Company on behalf of the Acquiring Fund,
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is a valid and binding obligation of the Company enforceable
against the Company and the Acquiring Fund in accordance with its
terms, subject as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights generally and to general equity principles; (c)
the Acquiring Fund Shares to be issued to the Acquired Fund's
shareholders as provided by this Agreement are duly authorized and
upon such delivery will be validly issued and outstanding and are
fully paid and non-assessable, and no shareholder of the Acquiring
Fund has any preemptive rights to subscription or purchase in
respect thereof; (d) the execution and delivery of this Agreement
did not, and the consummation of the transactions contemplated
hereby will not, result in a material violation of the Company's
Articles of Incorporation or By-Laws or any provision of any
agreement (known to such counsel) to which the Company or the
Acquiring Fund is a party or by which it is bound or, to the
knowledge of such counsel, result in the acceleration of any
obligation or the imposition of any penalty, under any agreement,
judgment or decree to which the Acquiring Fund is a party or by
which it is bound; (e) to the knowledge of such counsel, no
consent, approval, authorization or order of any court or
governmental authority of the United States, the State of Maryland
or Commonwealth of Massachusetts is required for the consummation
by the Company and the Acquiring Fund of the transactions
contemplated herein, except such as have been obtained under the
1933 Act, the 1934 Act and the 1940 Act, and such as may be
required under state securities law; (f) only insofar as they
relate to the Acquiring Fund, the descriptions in the Proxy
Statement of statutes, legal and governmental proceedings and
contracts and other documents, if any, are accurate and fairly
present the information required to be shown; (g) such counsel
does not know of any legal or governmental proceedings, only
insofar as they relate to the Acquiring Fund, existing on or
before the effective date of the Registration Statement or the
Closing Date required to be described in the Registration
Statement or to be filed as exhibits to the Registration Statement
which are not described or filed as required; (h) the Company is
registered as an investment company under the 1940 Act and its
registration with the Commission as an investment company under
the 1940 Act is in full force and effect; and (i) to the best
knowledge of such counsel, no litigation or administrative
proceeding or investigation of or before any court or governmental
body is presently pending or threatened as to the Company or the
Acquiring Fund or any of their properties or assets and neither
the Company nor the Acquiring Fund is a party to or subject to the
provisions of any order, decree or judgment of any court or
governmental body, which materially and adversely affects its
business, other than as previously disclosed in the Registration
Statement. In addition, such counsel also shall state that they
have participated in conferences with officers and other
representatives of the Company and the Acquiring Fund at which the
contents of the Proxy Statement and related matters were discussed
and, although they are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Proxy Statement (except to the extent
indicated in paragraph (f) of their above opinion), on the basis
of the foregoing (relying as to materiality to a large extent upon
the opinions of officers and other representatives of the Company
and the Acquiring Fund), no facts have come to their attention
that lead them to believe that the Proxy Statement as of its date,
as of the date of the Acquired Fund shareholders' meeting and as
of the Closing Date, contained an untrue
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statement of a material fact or omitted to state a material fact
required to be stated therein regarding the Acquiring Fund or
necessary to make the statements therein regarding the Acquiring
Fund, in light of the circumstances under which they were made,
not misleading. Such opinion may state that such counsel does not
express any opinion or belief as to the financial statements or
other financial data or as to the information relating to the
Trust and the Acquired Fund, contained in the Proxy Statement or
Registration Statement, and that such opinion is solely for the
benefit of the Trust, the Acquired Fund, its Trustees and its
officers. (Such counsel may rely as to matters governed by the
laws of the State of Maryland on an opinion of Maryland counsel.)
Such opinion also shall include such other matters incident to the
transaction contemplated hereby as the Acquired Fund may
reasonably request. Finally, such opinion need not opine with
respect to the applicability of Section 17(a) under the 1940 Act
and Rule 17a-8 thereunder.
In this paragraph 6.3, references to the Proxy Statement include
and relate only to the text of such Proxy Statement and not to any exhibits
or attachments thereto or to any documents incorporated by reference therein.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY AND THE
ACQUIRING FUND
The obligations of the Company and the Acquiring Fund to complete
the transactions provided for herein shall be subject, at their election, to
the performance by the Trust and the Acquired Fund of all the obligations to
be performed by them hereunder on or before the Closing Date and, in addition
thereto, the following conditions:
7.1 All representations and warranties of the Trust and the
Acquired Fund contained in this Agreement shall be true and correct in all
material respects as of the date hereof and, except as they may be affected
by the transactions contemplated by this Agreement, as of the Closing Date
with the same force and effect as if made on and as of the Closing Date;
7.2 The Acquired Fund shall have delivered to the Acquiring Fund a
statement of the Acquired Fund's assets and liabilities, together with a list
of the Acquired Fund's portfolio securities showing the tax costs of such
securities by lot and the holding periods of such securities, as of the
Closing Date, certified by the Treasurer or Assistant Treasurer of the Trust;
7.3 The Trust shall have delivered to the Acquiring Fund on the
Closing Date a certificate executed in its name and on behalf of the Acquired
Fund by its President or Executive Vice President and its Treasurer or
Assistant Treasurer, in form and substance satisfactory to the Company and
the Acquiring Fund and dated as of the Closing Date, to the effect that the
representations and warranties of the Trust and the Acquired Fund made in
this Agreement are true and correct at and as of the Closing Date, except as
they may be affected by the transactions contemplated by this Agreement, and
as to such other matters as the Acquiring Fund shall reasonably request; and
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7.4 The Company shall have received on the Closing Date a
favorable opinion of Dechert Price & Rhoads, counsel to the Acquired Fund,
covering the following points:
That (a) the Acquired Fund is a series of the Trust which is a
Massachusetts business trust, validly existing and in good
standing under the laws of the Commonwealth of Massachusetts and
has the statutory power to own all of its properties and assets
and to carry on its business as presently conducted; (b) the
Agreement has been duly authorized, executed and delivered by the
Trust on behalf of the Acquired Fund and, assuming that the
Prospectus, the Registration Statement and the Proxy Statement
comply with the 1933 Act, the 1934 Act and the 1940 Act and the
rules and regulations thereunder and, assuming due authorization,
execution and delivery of the Agreement by the Trust, is a valid
and binding obligation of the Trust and the Acquired Fund
enforceable against the Trust and the Acquired Fund in accordance
with its terms, subject as to enforcement to bankruptcy,
insolvency, reorganization, moratorium and other laws relating to
or affecting creditors' rights generally and to general equity
principles; (c) the execution and delivery of the Agreement did
not, and the consummation of the transactions contemplated hereby
will not, result in a material violation of the Trust's
Declaration of Trust or Code of Regulations or any provision of
any agreement (known to such counsel) to which the Trust or the
Acquired Fund is a party or by which it is bound or, to the
knowledge of such counsel, result in the acceleration of any
obligation or the imposition of any penalty, under any agreement,
judgment or decree to which the Trust or the Acquired Fund is a
party or by which it is bound; (d) to the knowledge of such
counsel, no consent, approval, authorization or order of any court
or governmental authority of the United States or the Commonwealth
of Massachusetts or State of Maryland is required for the
consummation by the Trust and the Acquired Fund of the
transactions contemplated herein, except such as have been
obtained under the 1933 Act, the 1934 Act and the 1940 Act, and
such as may be required under state securities laws; (e) only
insofar as they relate to the Trust and the Acquired Fund, the
descriptions in the Proxy Statement of statutes, legal and
governmental proceedings and contracts and other documents, if
any, are accurate and fairly present the information required to
be shown; (f) such counsel does not know of any legal or
governmental proceedings, only insofar as they relate to the Trust
and the Acquired Fund existing on or before the effective date of
the Registration Statement or the Closing Date, required to be
described in the Proxy Statement or to be filed as exhibits to the
Registration Statement which are not described and filed as
required; (g) the Trust is registered as an investment company
under the 1940 Act and its registration with the Commission as an
investment company under the 1940 Act is in full force and effect;
and (h) to the best knowledge of such counsel, no litigation or
administrative proceeding or investigation of or before any court
or governmental body is presently pending or threatened as to the
Trust or the Acquired Fund or any of its respective properties or
assets and neither the Trust nor the Acquired Fund is a party to
or subject to the provisions of any order, decree or judgment of
any court or governmental body, which materially and adversely
affects its business other than as previously disclosed in the
Proxy Statement. Such counsel also shall state that they have
participated in conferences with officers and other
representatives of the Trust and the Acquired Fund at which the
contents of the Proxy Statement and related matters were
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discussed and, although they are not passing upon and do not
assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Proxy Statement
(except to the extent indicated in paragraph (e) of their above
opinion), on the basis of the foregoing (relying as to materiality
to a large extent upon the opinions of officers and other
representatives of the Trust and the Acquired Fund), no facts have
come to their attention that lead them to believe that the Proxy
Statement as of its date, as of the date of the Acquired Fund's
shareholder meeting, and as of the Closing Date, contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein regarding the Trust or the
Acquired Fund or necessary in the light of the circumstances under
which they were made, to make the statements therein regarding the
Trust or the Acquired Fund not misleading. Such counsel may rely
as to matters governed by the Commonwealth of Massachusetts, on an
opinion of Massachusetts counsel. Such opinion may state that such
counsel does not express any opinion or belief as to the financial
statements or other financial data, or as to the information
relating to the Acquiring Fund, contained in the Proxy Statement
or Registration Statement, and that such opinion is solely for the
benefit of the Company, its Directors and its officers. Such
opinion also shall include such other matters incident to the
transaction contemplated hereby as the Company or the Acquiring
Fund may reasonably request. Finally, the opinion need not opine
upon any issues arising from the applicability of Section 17(a)
under the 1940 Act and Rule 17a-8 thereunder.
In this paragraph 7.4, references to the Proxy Statement include
and relate to only the text of such Proxy Statement and not to any exhibits
or attachments thereto or to any documents incorporated by reference therein.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY, THE
ACQUIRING FUND, THE TRUST AND THE ACQUIRED FUND
If any of the conditions set forth below do not exist on or before
the Closing Date with respect to the Acquired Fund or the Acquiring Fund, the
other party to this Agreement shall, at its option, not be required to
consummate the transactions contemplated by this Agreement:
8.1 The Agreement and the transactions contemplated herein shall
have been approved by the requisite vote of the holders of the outstanding
Shares of the Acquired Fund in accordance with the provisions of the Trust's
Declaration of Trust and Code of Regulations and certified copies of the
votes evidencing such approval shall have been delivered to the Company and
the Acquiring Fund. Notwithstanding anything herein to the contrary, neither
the Acquiring Fund nor the Acquired Fund may waive the conditions set forth
in this paragraph 8.1;
8.2 On the Closing Date, no action, suit or other proceeding shall
be pending before any court or governmental agency in which it is sought to
restrain or prohibit, or obtain damages or other relief in connection with,
this Agreement or the transactions contemplated herein;
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8.3 All consents of other parties and all other consents, orders
and permits of federal, state and local regulatory authorities (including
those of the Commission and of state Blue Sky and securities authorities,
including "no-action" positions of and exemptive orders from such federal and
state authorities) deemed necessary by the Acquiring Fund or the Acquired
Fund to permit consummation, in all material respects, of the transactions
contemplated hereby shall have been obtained, except where failure to obtain
any such consent, order or permit would not involve a risk of a material
adverse effect on the assets or properties of the Acquiring Fund or the
Acquired Fund, provided that either party hereto may for itself waive any of
such conditions.
8.4 The Registration Statement shall have become effective under
the 1933 Act and no stop orders suspending the effectiveness thereof shall
have been issued and, to the best knowledge of the parties hereto, no
investigation or proceeding for that purpose shall have been instituted or be
pending, threatened or contemplated under the 1933 Act;
8.5 The Acquired Fund and the Acquiring Fund shall have declared a
dividend or dividends which, together with all previous such dividends, shall
have the effect of distributing to the Acquired Fund and the Acquiring Fund's
shareholders all of each of the fund's investment company taxable income for
all taxable years ending on or prior to the Closing Date (computed without
regard to any deduction for dividends paid) and all of its net capital gain
realized in all taxable years ending on or prior to the Closing Date (after
reduction for any capital loss carryforward);
8.6 The parties shall have received an opinion of Dechert Price &
Rhoads, addressed to the Company and the Trust, substantially to the effect
that the transaction contemplated by this Agreement constitutes a tax-free
reorganization for federal income tax purposes. The delivery of such opinion
is conditioned upon receipt by Dechert Price & Rhoads of representations it
shall request of the Company and the Trust. Notwithstanding anything herein
to the contrary, neither the Acquiring Fund nor the Acquired Fund may waive
the conditions set forth in this paragraph 8.6.
9. BROKERAGE FEES AND EXPENSES
9.1 The Acquiring Fund and the Acquired Fund each represents and
warrants to the other that there are no brokers or finders entitled to
receive any payments in connection with the transactions provided for herein.
9.2 (a) Except as may be otherwise provided herein, the Acquired
Fund and the Acquiring Fund shall each be liable for its expenses incurred in
connection with entering into and carrying out the provisions of this
Agreement, whether or not the transactions contemplated hereby are
consummated. The expenses payable by the Acquired Fund hereunder shall
include the expenses of: (i) its counsel and independent accountants
associated with Reorganization; (ii) printing and mailing the
Prospectus/Proxy Statement and soliciting proxies in connection with the
meeting of shareholders of the Acquired Fund referred to in paragraph 5.2
hereof; (iii) all fees and expenses related to the liquidation of the
Acquired Fund; (iv) fees and expenses of the Acquired Fund's custodian and
transfer agent incurred in connection with the Reorganization; and (v) any
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special pricing fees associated with the valuation of the Acquired Fund's
portfolio on the Closing Date. The expenses payable by the Acquiring Fund
hereunder shall include: (i) fees and expenses of its counsel and independent
accountants associated with the Reorganization; (ii) expenses associated with
preparing this Agreement and preparing and filing the Registration Statement
under the 1933 Act covering the Acquiring Fund Shares to be issued in the
Reorganization; (iii) registration or qualification fees and expenses of
preparing and filing such forms, if any, necessary under applicable state
securities laws to qualify the Acquiring Fund Shares to be issued in
connection with the Reorganization; (iv) any fees and expenses of the
Acquiring Fund's custodian and transfer agent incurred in connection with the
Reorganization; and (v) any special pricing fees associated with the
valuation of the Acquiring Fund's portfolio on the Closing Date.
(b) Consistent with the provisions of paragraph 1.3, the Acquired
Fund, prior to the Closing, shall pay for or include in the unaudited
statement of assets and liabilities prepared pursuant to paragraph 1.3 all of
its known and reasonably estimated expenses associated with the transactions
contemplated by this Agreement.
10. ENTIRE AGREEMENT, SURVIVAL OF WARRANTIES
10.1 The Company, the Acquiring Fund, the Trust and the Acquired
Fund agree that no party has made any representation, warranty or covenant
not set forth herein and that this Agreement constitutes the entire agreement
between the parties.
10.2 The representations, warranties and covenants contained in
this Agreement or in any document delivered pursuant hereto or in connection
herewith shall survive the consummation of the transactions contemplated
hereunder.
11. TERMINATION
11.1 This Agreement may be terminated at any time at or prior to
the Closing Date: (1) by mutual agreement of the Acquired Fund and the
Acquiring Fund; (2) by the Acquired Fund in the event the Acquiring Fund or
the Company shall, or by the Acquiring Fund in the event the Acquired Fund or
the Trust shall, materially breach any representation, warranty or agreement
contained herein to be performed at or prior to the Closing Date; or (3) if a
condition herein expressed to be precedent to the obligations of the
terminating party has not been met and it reasonably appears that it will not
or cannot be met.
11.2 In the event of any such termination, there shall be no
liability for damages on the part of either the Trust or the Company, or
their respective Trustees or Directors, or officers, to the other party, but
each shall bear the expenses incurred by it incidental to the preparation and
carrying out of this Agreement as provided in paragraph 9.
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12. AMENDMENTS
This Agreement may be amended, modified or supplemented in such
manner as may be mutually agreed upon in writing by the authorized officers
of the Company and the Trust; provided, however, that following the meeting
of the Acquired Fund's shareholders called by the Trust pursuant to paragraph
5.2 of this Agreement, no such amendment may have the effect of changing the
provisions for determining the number of the Acquiring Fund Shares to be
issued to the Acquired Fund's shareholders under this Agreement to the
detriment of such shareholders without their further approval.
13. NOTICES
Any notice, report, statement or demand required or permitted by
any provisions of this Agreement shall be in writing and shall be given by
prepaid telegraph, telecopy or certified mail addressed to the Acquiring
Fund, 480 Pierce Street, Birmingham, Michigan 48009, Attention: Lisa A.
Rosen; or to the Acquired Fund, 480 Pierce Street, Birmingham, Michigan
48009, Attention: Lisa A. Rosen.
14. HEADINGS; COUNTERPARTS; GOVERNING LAW, ASSIGNMENT, LIMITATION OF
LIABILITY
14.1 The article and paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
14.2 This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original.
14.3 This Agreement shall be governed by and construed in
accordance with the laws of the State of Maryland
14.4 This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns, but no assignment
or transfer hereof or of any rights or obligations hereunder shall be made by
any party without the written consent of the other parties. Nothing herein
expressed or implied is intended or shall be construed to confer upon or give
any person, firm or corporation, other than the parties hereto and their
respective successors and assigns, any rights or remedies under or by reason
of this Agreement.
14.5 The name of the Munder Funds Trust and the Trustees of the
Munder Funds Trust refer respectively to the Trust created and the Trustees,
as trustees but not individually or personally, acting from time to time
under a Declaration of Trust dated August 30, 1989, as amended, which is
hereby referred to and a copy of which is on file at the office of the State
Secretary of The Commonwealth of Massachusetts and at the principal office of
the Trust. The obligations of the Trust entered into in the name or on behalf
thereof by any of the Trustees,
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officers, representatives or agents are made not individually, but in such
capacities, and are not binding upon any of the Trustees, shareholders,
officers, representatives or agents of the Trust personally, but bind only
the Trust Property (as defined in the Trust's Declaration of Trust), and all
persons dealing with any class of shares of the Trust must look solely to the
Trust Property belonging to such class for the enforcement of any claims
against the Trust.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by its Chairman of the Board, President or Vice
President and its seal to be affixed hereto and attested by its Secretary.
THE MUNDER FUNDS, INC.
on behalf of Munder
Multi-Season Growth Fund
Attest: By:___________________________
Name:________________
_______________________________
Title:_______________
MUNDER FUNDS TRUST
on behalf of Munder
Accelerating Growth Fund
Attest: By:___________________________
Name: _______________
______________________________
Title:_______________
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EXHIBIT B
INVESTMENT ADVISORY AGREEMENT
AGREEMENT, made this 2nd day of July, 1998, between The Munder
Funds Trust (the "Trust") on behalf of each Fund (collectively, the "Funds")
set forth on Schedule A attached hereto, and Munder Capital Management (the
"Advisor"), a Delaware partnership.
WHEREAS, the Trust is a Massachusetts business trust authorized to
issue shares in series and is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940
Act"), and each Fund is a series of the Trust;
WHEREAS, the Advisor is registered as an investment advisor under
the Investment Advisers Act of 1940, as amended (the "Advisers Act"); and
WHEREAS, the Trust wishes to retain the Advisor to render
investment advisory services to the Funds, and the Advisor is willing to
furnish such services to the Funds;
NOW, THEREFORE, in consideration of the promises and mutual
covenants herein contained, it is agreed between the Trust and the Advisor as
follows:
1. Appointment
(a) The Trust hereby appoints the Advisor to act as investment
advisor to the Funds for the periods and on the terms set forth herein. The
Advisor accepts the appointment and agrees to furnish the services set forth
herein for the compensation provided herein.
(b) In the event that the Trust establishes one or more portfolios
other than the Funds listed on Schedule A attached hereto, with respect to
which it desires to retain the Investment Advisor to act as investment
advisor hereunder, it shall notify the Investment Advisor in writing. If the
Investment Advisor is willing to render such services under this Agreement it
shall notify the Trust in writing whereupon such portfolio shall become a
Fund hereunder and shall be subject to the provisions of this Agreement to
the same extent as the Fund named above except to the extent that said
provisions (including those relating to the compensation payable by the Fund
to the Investment Advisor) are modified with respect to such Fund in writing
by the Trust and the Investment Advisor at the that time.
2. Services as Investment Advisor
Subject to the general supervision and direction of the Board of
Trustees of the Trust, the Advisor will (a) provide overall management to the
Funds in accordance with each Fund's investment objective and policies as
stated in the Fund's Prospectus and the Statement of Additional Information
filed with the Securities and Exchange Commission, as they may be amended
from time to time; (b) make investment decisions for the Funds; (c) oversee
the placement of purchase and sale orders on behalf of the Funds; (d) employ
professional portfolio managers and securities analysts to provide research
services to the Funds; (e) maintain books and records with respect to each
Fund's securities transactions; and (f) provide periodic and special reports
to the Board of Trustees of the Trust, as requested. In providing those
services, the Advisor will provide the Funds with ongoing research, analysis,
advice and judgments regarding individual investments, general economic
conditions and trends and long-range investment policy. In addition, the
Advisor will furnish the Funds with whatever
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statistical information the Funds may reasonably request with respect to the
securities that the Funds may hold or contemplate purchasing.
The Advisor further agrees that, in performing its duties
hereunder, it will:
(a) comply with the 1940 Act and all rules and regulations
thereunder and under the Advisers Act, the Internal Revenue Code of 1986, as
amended (the "Code"), and all other applicable federal and state law and
regulations, and with any applicable procedures adopted by the Trustees;
(b) use reasonable efforts to manage each Fund so that it will
qualify, and continue to qualify, as a regulated investment company under
Subchapter M of the Code and regulations issued thereunder;
(c) maintain books and records with respect to each Fund's
securities transactions, render to the Board of Trustees of the Trust such
periodic and special reports as the Board may reasonably request, and keep
the Trustees informed of developments materially affecting each Fund's
portfolio;
(d) make available to the Funds' administrator and the Trust,
promptly upon their request, such copies of its investment records and
ledgers with respect to the Funds as may be required to assist the
administrator and the Trust in their compliance with applicable laws and
regulations. The Advisor will furnish the Trustees with such periodic and
special reports regarding the Funds as they may reasonably request; and
(e) immediately notify the Trust in the event that the Advisor or
any of its affiliates: (1) becomes aware that it is subject to a statutory
disqualification that prevents the Advisor from serving as investment advisor
pursuant to this Agreement; or (2) becomes aware that it is the subject of an
administrative proceeding or enforcement action by the Securities and
Exchange Commission or other regulatory authority. The Advisor further agrees
to notify the Trust immediately of any material fact known to the Advisor
respecting or relating to the Advisor that is not contained in the Trust's
Registration Statement regarding the Funds, or any amendment or supplement
thereto, but that is required to be disclosed therein, and of any statement
contained therein that becomes untrue in any material respect.
3. Documents
The Trust has delivered properly certified or authenticated copies
of each of the following documents to the Advisor and will deliver to it all
future amendments and supplements thereto, if any:
(a) certified resolution of the Board of Trustees of the Trust
authorizing the appointment of the Advisor and approving the form of this
Agreement;
(b) the Registration Statement describing the Fund as filed with
the Securities and Exchange Commission and any amendments thereto; and
(c) exhibits, powers of attorneys, certificates and any and all
other documents relating to or filed in connection with the Registration
Statement described above.
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4. Brokerage
In selecting brokers or dealers to execute transactions on behalf
of the Funds, the Advisor will use its best efforts to seek the best overall
terms available. In assessing the best overall terms available for any Fund
transaction, the Advisor will consider all factors it deems relevant,
including, but not limited to, the breadth of the market in the security, the
price of the security, the financial condition and execution capability of
the broker or dealer and the reasonableness of the commission, if any, for
the specific transaction and on a continuing basis. In selecting
brokers-dealers to execute a particular transaction, and in evaluating the
best overall terms available, the Advisor is authorized to consider the
brokerage and research services (as those terms are defined in Section 28(e)
of the Securities Exchange Act of 1934, as amended (the "1934 Act")) provided
to the Funds and/or other accounts over which the Advisor or its affiliates
exercise investment discretion. The parties hereto acknowledge that it is
desirable for the Trust that the Advisor have access to supplemental
investment and market research and security and economic analysis provided by
brokers-dealers who may execute brokerage transactions at a higher cost to
the Trust than may result when allocating brokerage to other brokers on the
basis of seeking the most favorable price and efficient execution. Therefore,
the Advisor may cause the Fund to pay a broker-dealer which furnishes
brokerage and research services a higher commission than that which might be
charged by another broker-dealer for effecting the same transaction, provided
that the Advisor determines in good faith that such commission is reasonable
in relation the value of the brokerage and research services provided by such
broker-dealer, viewed in terms of either the particular transaction or the
overall responsibilities of the Advisor to the Fund. It is understood that
the services provided by such brokers may be useful to the Advisor in
connection with the Advisor's services to other clients. In accordance with
Section 11(a) of the 1934 Act and Rule 11a2-2(T) thereunder and subject to
any other applicable laws and regulations, the Advisor and its affiliates are
authorized to effect portfolio transactions for the Funds and to retain
brokerage commissions on such transactions.
5. Records
The Advisor agrees to maintain and to preserve for the periods
prescribed under the 1940 Act any such records as are required to be
maintained by the Advisor with respect to the Funds by the 1940 Act. The
Advisor further agrees that all records which it maintains for the Funds are
the property of the Funds and it will promptly surrender any of such records
upon request.
6. Standard of Care
The Advisor shall exercise its best judgment in rendering the
services under this Agreement. The Advisor shall not be liable for any error
of judgment or mistake of law or for any loss suffered by a Fund or the
Funds' shareholders in connection with the matters to which this Agreement
relates, provided that nothing herein shall be deemed to protect or purport
to protect the Advisor against any liability to a Fund or to its shareholders
to which the Advisor would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence on its part in the performance of
its duties or by reason of the Advisor's reckless disregard of its
obligations and duties under this Agreement. As used in this Section 6, the
term "Advisor" shall include any officers, Trustees, employees, or other
affiliates of the Advisor performing services with respect to a Fund.
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<PAGE>
7. Compensation
In consideration of the services rendered pursuant to this
Agreement, each Fund will pay the Advisor a fee as set forth on Schedule B
attached hereto. This fee shall be computed and accrued daily and payable
monthly; however, with respect to any Fund for which the effective date of
this Agreement is prior to November 30, 1998, the fee shall be maintained in
an interest-bearing escrow account until such time as shareholders of the
Fund approve the payment of fees pursuant to this agreement. If shareholders
do not approve such payment of fees on or before November 30, 1998, the
balance in the escrow account shall be paid to the Fund. For the purpose of
determining fees payable to the Advisor, the value of a Fund's average daily
net assets shall be computed at the times and in the manner specified in the
Fund's Prospectus or Statement of Additional Information.
8. Expenses
The Advisor will bear all expenses in connection with the
performance of its services under this Agreement and will bear the costs and
expenses payable to Sub-Advisors under the Sub-Advisory Agreements. Each Fund
will bear certain other expenses to be incurred in its operation, including:
taxes, interest, brokerage fees and commissions, if any, fees of Trustees of
the Trust who are not officers, Trustees or employees of the Advisor or any
Sub-Advisor; Securities and Exchange Commission fees and state blue sky fees;
charges of custodians and transfer and dividend disbursing agents; the Fund's
proportionate share of insurance premiums; outside auditing and legal
expenses; costs of maintenance of the Fund's existence; costs attributable to
investor services, including, without limitation, telephone and personal
expenses; charges of an independent pricing service, costs of preparing and
printing prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of
shareholders' reports and meetings of the shareholders of the Fund and of the
officers of Board of Trustees of the Trust; and any extraordinary expenses.
9. Services to Other Companies or Accounts
The investment advisory services of the Advisor to the Funds under
this Agreement are not to be deemed exclusive, and the Advisor, or any
affiliate thereof, shall be free to render similar services to other
investment companies and clients (whether or not their investment objective
and policies are similar to those of a Fund) and to engage in activities so
long as its services hereunder are not impaired thereby.
10. Duration and Termination
This Agreement shall become effective on the date of this
Agreement provided that with respect to any Fund, this Agreement shall not
take effect unless it has been approved (a) by a vote of a majority of the
Board of Trustees of the Trust, including a majority of those Trustees who
are not "interested persons" (as defined in the 1940 Act) of any party to
this
B-4
<PAGE>
Agreement cast in person at a meeting called for the purpose of voting
on such approval and (b) by vote of a majority of that Fund's outstanding
voting securities and shall continue in effect with respect to the Fund,
unless sooner terminated as provided herein, for two years from such date and
shall continue from year to year thereafter, provided each continuance is
specifically approved at least annually by (i) the vote of a majority of the
Board of Trustees of the Trust or (ii) a vote of a "majority" (as defined in
the 1940 Act) of the Fund's outstanding voting securities, provided that in
either event the continuance is also approved by a majority of the Board of
Trustees who are not "interested persons" (as defined in the 1940 Act) of any
party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This Agreement is terminable with respect
to the Funds, or any Fund, without penalty, on sixty (60) days' written
notice by the Board of Trustees of the Trust or by vote of the holders of a
"majority" (as defined in the 1940 Act) of the shares of the affected Funds
or upon ninety (90) days' written notice by the Advisor. Termination of this
Agreement with respect to any given Fund, shall in no way affect the
continued validity of this Agreement or the performance thereunder with
respect to any other Fund. This Agreement will be terminated automatically in
the event of its "assignment" (as defined in the 1940 Act).
11. Amendment
No provision of this Agreement may be changed, waived or
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 with respect to any
Fund shall be effective until approved by an affirmative vote of (i) a
majority of the outstanding voting securities of that Fund, and (ii) a
majority of the Trustees of the Trust, including a majority of Trustees who
are not "interested persons" (as defined in the 1940 Act) of any party to
this Agreement, cast in person at a meeting called for the purpose of voting
on such approval, if such approval is required by applicable law.
12. Use of Name
It is understood that the name of Munder Capital Management or any
derivative thereof or logo associated with that name is the valuable property
of the Advisor and its affiliates, and that the Trust and each Fund have the
right to use such name (or derivable or logo) only so long as this Agreement
shall continue with respect to a given Fund. Upon termination of this
Agreement, or upon termination of this Agreement with respect to a given
Fund, the Trust and any affected Fund shall forthwith cease to use such name
(or derivable or logo) and the Trust shall promptly amend its Articles of
Incorporation to change the Fund name to comply herewith.
The words "The Munder Funds Trust" and "Trustees" or "Board of
Trustees" used herein refer respectively to the Trust created and the
Trustees, as trustees of the Trust but not individually or personally acting
from time to time under a Declaration of Trust dated August 30, 1989 which is
hereby referred to and a copy of which is on file at the office of the
Secretary of The Commonwealth of Massachusetts and at the principal office of
the Trust. The obligations of "The Munder Framlington Funds Trust" entered
into the name or on behalf thereof by any of the Trustees, officers,
representatives or agents of the Trust are made not individually, but in such
capacities, and are not binding upon any of the Trustees, shareholders,
officers, representatives or agents of the Trust personally, but bind only
the Trust Property, and all persons dealing with any class of shares of the
Trust must look solely to the Trust Property belonging to such class for the
enforcement of any claims against the Trust.
13. Miscellaneous
(a) This Agreement constitutes the full and complete agreement of
the parties hereto with respect to the subject matter hereof.
(b) Titles or captions of sections in this Agreement are inserted
only as a matter of convenience and for reference, and in no way define,
limit, extend or describe the scope of this Agreement or the intent of any
provisions thereof.
B-5
<PAGE>
(c) This Agreement may be executed in several counterparts, all of
which together shall for all purposes constitute one Agreement, binding on
all the parties.
(d) This Agreement and the rights and obligations of the parties
hereunder shall be governed by, and interpreted, construed and enforced in
accordance with the laws of the State of Michigan.
(e) If any provisions of this Agreement or the application thereof
to any party or circumstances shall be determined by any court of competent
jurisdiction to be invalid or unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person
circumstance, other than these as to which it so determined to be invalid or
unenforceable, shall not be affected thereby, and each provision hereof shall
be valid and shall be enforced to the fullest extent permitted by law.
(f) Notices of any kind to be given to the Advisor by the Trust
shall be in writing and shall be duly given if mailed or delivered to the
Advisor at 480 Pierce Street, Birmingham, Michigan 48009, or at such other
address or to such individual as shall be specified by the Advisor to the
Trust. Notices of any kind to be given to the Trust by the Advisor shall be
in writing and shall be duly given if mailed or delivered to 480 Pierce
Street, Birmingham, Michigan 48009, or at such the address to such individual
as shall be specified by the Trust to the Advisor.
B-6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their officers designated below on the day and year first
above written.
THE MUNDER FUNDS TRUST
By: ______________________
MUNDER CAPITAL MANAGEMENT
By: _______________________
B-7
<PAGE>
SCHEDULE A
Munder Accelerating Growth Fund
Munder Balanced Fund Munder Bond Fund
Munder Cash Investment Fund
Munder Growth & Income Fund
Munder Index 500 Fund
Munder Intermediate Bond Fund
Munder International Equity Fund
Munder Michigan Triple Tax-Free Bond Fund
Munder Small Company Growth Fund
Munder Tax-Free Bond Fund
Munder Tax-Free Intermediate Bond Fund
Munder Tax-Free Money Market Fund
Munder U.S. Government Income Fund
Munder U.S. Treasury Money Market Fund
B-8
<PAGE>
SCHEDULE B
<TABLE>
<CAPTION>
Fund Annual Fees (as a Percentage of
Average Daily Net Assets)
<S> <C>
Munder Accelerating Growth Fund 0.75%
Munder Balanced Fund 0.65%
Munder Bond Fund 0.50%
Munder Cash Investment Fund 0.35%
Munder Growth & Income Fund 0.75%
Munder Index 500 Fund 0.20% of the first $250 million;
0.12% of the next $250 million;
0.07% of net assets in excess of
$500 million
Munder International Equity Fund 0.75%
Munder Intermediate Bond Fund 0.50%
Munder Michigan Triple Tax-Free Bond Fund 0.50%
Munder Small Company Growth Fund 0.75%
Munder Tax-Free Bond Fund 0.50%
Munder Tax-Free Intermediate Bond Fund 0.50%
Munder Tax-Free Money Market Fund 0.35%
Munder U.S. Government Income Fund 0.50%
Munder U.S. Treasury Money Market Fund 0.35%
</TABLE>
B-9
<PAGE>
[ PROXY CARD, FRONT ]
THE MUNDER FUNDS TRUST
THE MUNDER ACCELERATING GROWTH FUND
Please fold and detach card at perforation before mailing
MUNDER ACCELERATING GROWTH FUND SPECIAL MEETING OF SHAREHOLDERS
PROXY November 20, 1998
The undersigned hereby appoints Terry H. Gardner and Lisa A. Rosen as
attorneys and proxies with full power of substitution to vote and act with
respect to all shares of the Munder Accelerating Growth Fund (the "Fund")
held by the undersigned, at the Special Meeting of Shareholders of the
Fund at 10:00 a.m., Eastern Time, on Friday, November 20, 1998, at the
offices of The Munder Funds Trust (the "Trust"), 480 Pierce Street,
Birmingham, Michigan 48009, and at any adjournment thereof (the "Meeting"),
and instructs them to vote as indicated on the matters referred to in the
Proxy Statement for the Meeting, receipt of which is hereby acknowledged,
with discretionary power to vote upon such other business as may properly
come before the Meeting.
Receipt of the Notice of Special Meeting and Proxy Statement is hereby
acknowledged.
PLEASE VOTE, SIGN AND DATE THIS PROXY AND
RETURN IT IN THE ENCLOSED POSTAGE-PAID
ENVELOPE.
Dated: ______________ , 1998
_______________________________________
Signature(s)
This proxy must be signed by the beneficial owner
of Fund shares. If signing as attorney, executor,
guardian or in some representative capacity or
as an officer of a corporation, please add title
as such.
<PAGE>
[ PROXY CARD, BACK ]
Please fold and detach card at perforation before mailing
This proxy will be voted as specified. IF NO SPECIFICATION IS MADE, THIS PROXY
WILL BE VOTED FOR BOTH OF THE PROPOSALS.
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES OF THE TRUST. The Board of
Trustees recommends that you vote FOR the following proposals:
Please vote by filling in the appropriate boxes below.
FOR AGAINST ABSTAIN
I. To approve an Agreement and Plan of / / / / / /
Reorganization.
II. To approve a new Investment Management / / / / / /
Agreement for the Fund.
