MUNDER FUNDS TRUST, 485APOS, 1999-08-27

MUNDER FUNDS TRUST
485APOS, 1999-08-27

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<PAGE>

As filed with the Securities and Exchange Commission

on August 27, 1999

Registration Nos. 33-30913
811-5899

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]

Pre-Effective Amendment No. ---- [ ]

Post-Effective Amendment No. 28 [X]

REGISTRATION STATEMENT UNDER
THE INVESTMENT COMPANY ACT OF 1940 [X]

Amendment No. 30 [X]

(Check appropriate box or boxes)

The Munder Funds Trust
(Exact Name of Registrant as Specified in Charter)

480 Pierce Street, Birmingham, Michigan 48009
(Address of Principal Executive Offices) (Zip code)

Registrant's Telephone Number: (248) 647-9200

Cynthia Surprise
Vice President and Associate Counsel
State Street Bank and Trust Company
2 Avenue de Lafayette
Boston, MA 02111
(Name and Address of Agent for Service)
Copies to:

Terry H. Gardner Jane Kanter, Esq.
Munder Capital Management Dechert Price & Rhoads
480 Pierce Street 1775 Eye Street, NW
Birmingham, Michigan 48009 Washington, DC 20006

[X] It is proposed that this filing will become effective 60 days after filing
(October 26, 1999) pursuant to paragraph (a)(1) of Rule 485
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Prospectus for The Munder Funds
(Equity Funds Class A, B and C Shares)

Part A
- ------

Item Heading
---- -------
<S> <C> <C>
1. Cover Page Front and Back Cover Pages

2. Synopsis Risk/Return Summary

3. Condensed Financial Information Not Applicable

4. General Description of Registrant Front and Back Pages; Risk/Return Summary;
More About the Funds; Management

5. Management of the Funds Management; Distributions; Federal Tax
Considerations

6. Capital Stock and Other Securities Management; Your Investment; Distribution
Arrangements; Pricing of Fund Shares;
Distributions; Federal Tax Considerations

7. Purchase of Securities Being Offered Your Investment; Distribution Arrangements;
Pricing of Fund Shares

8. Redemption or Repurchase Your Investment; Distribution Arrangements

9. Pending Legal Proceedings Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Prospectus for The Munder Funds
(Class K Shares)

Part A
- ------

<TABLE>
<CAPTION>
Item Heading
---- -------
<S> <C> <C>
1. Cover Page Front and Back Cover Pages

2. Synopsis Risk/Return Summary

3. Condensed Financial Information Not Applicable

4. General Description of Registrant Front and Back Pages; Risk/Return
Summary; More About the Funds;
Management

5. Management of the Funds Management; Distributions; Federal Tax
Considerations

6. Capital Stock and Other Securities Management; Your Investment; Pricing of
Fund Shares; Distributions; Federal Tax
Considerations

7. Purchase of Securities Being Offered Your Investment; Pricing of Fund Shares

8. Redemption or Repurchase Your Investment

9. Pending Legal Proceedings Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Prospectus for The Munder Funds
(Class Y Shares)

Part A
- ------

<TABLE>
<CAPTION>
Item Heading
---- -------
<S> <C> <C>
1. Cover Page Front and Back Cover Pages

2. Synopsis Risk/Return Summary

3. Condensed Financial Information Not Applicable

4. General Description of Registrant Front and Back Pages; Risk/Return
Summary; More About the Funds;
Management

5. Management of the Funds Management; Distributions; Federal Tax
Considerations

6. Capital Stock and Other Securities Management; Your Investment; Pricing of
Fund Shares; Distributions; Federal Tax
Considerations

7. Purchase of Securities Being Offered Your Investment; Pricing of Fund Shares

8. Redemption or Repurchase Your Investment

9. Pending Legal Proceedings Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Prospectus for The Munder Funds
(Income Funds Class A, B and C Shares)

Part A
- ------

<TABLE>
<CAPTION>
Item Heading
---- -------
<S> <C> <C>
1. Cover Page Front and Back Cover Pages

2. Synopsis Risk/Return Summary

3. Condensed Financial Information Not Applicable

4. General Description of Registrant Front and Back Pages; Risk/Return Summary;
More About the Funds; Management

5. Management of the Funds Management; Distributions; Federal Tax
Considerations

6. Capital Stock and Other Securities Management; Your Investment; Distribution
Arrangements; Pricing of Fund Shares;
Distributions; Federal Tax Considerations

7. Purchase of Securities Being Offered Your Investment; Distribution Arrangements;
Pricing of Fund Shares

8. Redemption or Repurchase Your Investment; Distribution Arrangements

9. Pending Legal Proceedings Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Prospectus for The Munder Funds
(Money Market Funds Class A, B and C Shares)

Part A
- ------

<TABLE>
<CAPTION>
Item Heading
---- -------
<S> <C> <C>
1. Cover Page Front and Back Cover Pages

2. Synopsis Risk/Return Summary

3. Condensed Financial Information Not Applicable

4. General Description of Registrant Front and Back Pages; Risk/Return
Summary; More About the Funds;
Management

5. Management of the Funds Management; Distributions; Federal Tax
Considerations

6. Capital Stock and Other Securities Management; Your Investment;
Distribution Arrangements; Pricing of
Fund Shares; Distributions; Federal Tax
Considerations

7. Purchase of Securities Being Offered Your Investment; Distribution
Arrangements; Pricing of Fund Shares

8. Redemption or Repurchase Your Investment; Distribution
Arrangements

9. Pending Legal Proceedings Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Prospectus for The Munder Funds
(The Munder Index 500 Fund Class A, B and C Shares)

Part A
- ------

<TABLE>
<CAPTION>
Item Heading
---- -------
<S> <C> <C>
1. Cover Page Front and Back Cover Pages

2. Synopsis Risk/Return Summary

3. Condensed Financial Information Not Applicable

4. General Description of Registrant Front and Back Pages; Risk/Return
Summary; More About the Funds;
Management

5. Management of the Fund Management; Distributions; Federal Tax
Considerations

6. Capital Stock and Other Securities Management; Your Investment;
Distribution Arrangements; Pricing of
Fund Shares; Distributions; Federal Tax
Considerations

7. Purchase of Securities Being Offered Your Investment; Distribution
Arrangements; Pricing of Fund Shares

8. Redemption or Repurchase Your Investment; Distribution
Arrangements

9. Pending Legal Proceedings Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Prospectus for The Munder Funds
(The Munder Index 500 Fund Class Y Shares)

Part A
- ------

<TABLE>
<CAPTION>
Item Heading
---- -------
<S> <C> <C>
1. Cover Page Front and Back Cover Pages

2. Synopsis Risk/Return Summary

3. Condensed Financial Information Not Applicable

4. General Description of Registrant Front and Back Pages; Risk/Return
Summary; More About the Funds;
Management

5. Management of the Fund Management; Distributions; Federal Tax
Considerations

6. Capital Stock and Other Securities Management; Your Investment; Pricing of
Fund Shares; Distributions; Federal Tax
Considerations

7. Purchase of Securities Being Offered Your Investment; Pricing of Fund Shares

8. Redemption or Repurchase Your Investment

9. Pending Legal Proceedings Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

CROSS-REFERENCE SHEET

Pursuant to Rule 495(a)

Statement of Additional Information
(Munder Funds)

Part B
- ------

<TABLE>
<S> <C> <C>
10. Cover Page Cover Page

11. Table of Contents Table of Contents

12. General Information and History See Prospectus --"Management;"
History and General Information;
Management of the Fund

13. Investment Objectives and Policies Fund Investments; Investment
Limitations; Portfolio Transactions

14. Management of the Funds Management of the Fund; Other
Information

15. Control Persons and Principal Other Information; Control Persons
Holders of Securities and Principal Holders of Securities

16. Investment Advisory Services and Investment Advisory and Other Service
Other Services Arrangements; See Prospectus
--"Management"

17. Brokerage Allocation and Other Portfolio Transactions
Practices

18. Capital Stock and Other Securities Additional Information Concerning
Shares

19. Purchase, Redemption and Pricing of Additional Purchase and Redemption
Securities Being Offered Information; Net Asset Value;
Additional Information Concerning
Shares

20. Tax Status Taxes

21. Underwriters Investment Advisory and Other Service
Arrangements

22. Calculation of Performance Data Performance Information

23. Financial Statements Not Applicable
</TABLE>
<PAGE>

THE MUNDER FUNDS TRUST

The purposes of this Post-Effective Amendment filing are (i) to rewrite and
streamline the Prospectuses for the 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
Tax-Free Bond Fund, Munder Small Company Growth Fund, Munder Tax-Free Bond Fund,
Munder Tax-Free Short-Intermediate Bond Fund, Munder Tax-Free Money Market Fund,
Munder U.S. Government Income Fund and Munder U.S. Treasury Money Market Fund;
(ii) to conform the Prospectuses for all the Funds to the requirements of
amended Form N-1A and (iii) to incorporate supplements to the Prospectuses and
Statement of Additional Information.
<PAGE>

Class A, B & C Shares

[Munder Logo]

Prospectus

October 26, 1999

The Munder Equity Funds

Balanced
Equity Selection
Growth & Income
Growth Opportunities
International Equity
Micro-Cap Equity
Multi-Season Growth
Real Estate Equity Investment
Small-Cap Value
Small Company Growth
Value

The Munder Framlington Funds
Framlington Emerging Markets
Framlington Global Financial Services
Framlington Healthcare
Framlington International Growth

As with all mutual funds, the
Securities and Exchange Commission
has not approved or disapproved these
securities nor passed upon the accuracy
or adequacy of this prospectus. It is a
criminal offense to state otherwise
<PAGE>

<TABLE>
<CAPTION>
Table Of Contents
<S> <C>
2 Risk/Return Summary
9 Summary Of Principal Risks
14 Who May Want To Invest
24 Fees And Expenses

28 More About The Funds
28 Glossary
28 Special Risks And Other Considerations
31 Additional Description Of Investments And Investment Strategies

36 Your Investment
36 How To Reach The Funds
37 Purchasing Shares
37 Exchanging Shares
37 Redeeming Shares
38 Additional Policies For Purchases, Exchanges And Redemptions
39 Shareholder Privileges

40 Distribution Arrangements
40 Share Class Selection
40 Applicable Sales Charge
42 CDSC
43 12B-1 Fees
43 Other Information

44 Pricing Of Fund Shares

45 Distributions

46 Federal Tax Considerations
46 Taxes On Distributions
46 Taxes On Sales Or Exchanges
47 Other Considerations

48 Management
48 Investment Advisors And Sub-advisor
49 Portfolio Managers

51 Financial Highlights

Back Cover For Additional Information
</TABLE>
<PAGE>

Risk/Return Summary
- --------------------------------------------------------------------------------

The Risk/Return Summary includes a table for each Fund showing its average
annual returns and a bar chart showing its annual returns. The table and bar
chart provide an indication of the historical risk of an investment in each Fund
by showing:

. how the Fund's average annual returns for 1, 5, and 10 years (or over the
life of the Fund if the Fund is less than 10 years old) compare to those of
a broad based securities market index; and;

. changes in the Fund's performance from year to year over 10 years (or over
the life of the Fund if the Fund is less than 10 years old).

When you consider this information, please remember that a Fund's performance in
past years is not necessarily an indication of how the Fund will perform in the
future.

An investment in the Funds is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency.

Certain terms used in this prospectus are defined in the Glossary.

2
<PAGE>

- ---------------------------------------------------------
Equity Funds
- ---------------------------------------------------------

Balanced Fund

Goal

The Fund's goal is to provide an attractive investment return through a
combination of growth of capital and current income.

Principal Investment Strategies

The Fund pursues its goal by allocating its assets among three asset groups:
equity securities, fixed income securities and cash equivalents.

The Fund normally will invest at least 25% of its assets in fixed income
securities and no more than 75% of its assets in equity securities. The Fund
will notify shareholders at least 30 days before changing this policy.

The advisor will allocate the Fund's assets to the three asset groups based on
its view of the following factors, among others:
. general market and economic conditions and trends;
. interest rates and inflation rates;
. fiscal and monetary developments; and o long-term corporate earnings
growth.

The advisor will try to take advantage of changing economic conditions by
adjusting the ratio of equity securities to fixed income securities or cash
equivalents. For example, if the advisor believes that rapid economic growth
will lead to better corporate earnings in the future, then it might increase the
Fund's equity securities holdings and reduce its fixed income securities and
cash equivalents holdings.

The Fund's fixed income securities include:
. U.S. Government securities;
. obligations of foreign governments;
. corporate obligations;
. zero coupon bonds;
. variable and floating rate securities;
. mortgage and other asset-backed securities; and
. stripped securities.

The Fund's cash equivalents are short-term, high-quality money market
instruments and include:
. commercial paper;
. bankers' acceptances and certificates of deposit;
. corporate obligations; and
. U.S. Government securities.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk, interest
rate risk and credit risk. To the extent that the Fund purchases foreign
securities, it may be subject to foreign securities risk. To the extent that the
Fund enters into futures and options on futures contracts, it may be subject to
derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year 5 Years Inception
- ------------------------- ---------- --------- -----------
Class A (4/30/93)
Class B (6/21/94)
Class C (1/24/96)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

________________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

3
<PAGE>

Equity Selection Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities.

The Fund invests in equity securities which the advisor believes are undervalued
compared to stocks of other companies in the same industry.

The Fund generally invests in companies with market capitalizations of at least
$1 billion.

The Fund diversifies its assets by industry in approximately the same weightings
as those of the S&P 500.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment, strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

As of the date of this prospectus, the Fund had not commenced operations and,
therefore, does not have annual returns for a full calendar year. For this
reason, a bar chart and performance table showing performance information and
information on the Fund's best and worst calendar quarters is not provided in
this prospectus.

4
<PAGE>

Growth & Income Fund

Goal

The Fund's goal is to provide capital appreciation and current income.

Principal Investment Strategies

The Fund pursues its goal by investing primarily in dividend-paying equity
securities.
Under normal circumstances, the Fund will invest at least 65% of its assets in
income-producing common stocks and convertible preferred stocks.

The Fund may also purchase fixed income securities which are convertible into or
exchangeable for common stock.

The advisor generally selects large, well-known companies that it believes have
favorable prospects for dividend growth and capital appreciation. The Fund will
seek to produce a current yield greater than the S&P 500.

The Fund focuses on dividend-paying equity securities because, over time,
dividend income has accounted for a significant portion of the total return of
the S&P 500. In addition, dividends are usually a more stable and predictable
source of return than capital appreciation. The advisor believes that stocks
which distribute a high level of current income generally have more stable
prices than those which pay below average dividends.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1995: _____%
1996: _____%
1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year Inception
- ------------------------ ---------- ------------
Class A (8/8/94)
Class B (8/9/94)
Class C (12/5/95)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

5
<PAGE>

Growth Opportunities Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in the equity
securities of companies with market capitalizations between $500 million and $10
billion.

Its style, which focuses on both growth prospects and valuation, is known as
GARP (Growth at a Reasonable Price) and seeks to produce attractive returns
during various market environments.

The advisor chooses the Fund's investments by reviewing the earnings growth of
approximately 10,000 companies over the past three years and investing in
approximately 50 to 100 companies based on:

. superior earnings growth;
. financial stability;
. relative market value; and
. price changes compared to the S&Ps MidCap 400 Index.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

As of the date of this prospectus, the Fund has not completed a full calendar
year of operations. For this reason, a bar chart and performance table showing
performance information and information on the Fund's best and worst calendar
quarters is not provided in this prospectus.

6
<PAGE>

International Equity Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing primarily in foreign securities including
American Depositary Receipts.

Under normal market conditions, at least 65% of the Fund's assets are invested
in equity securities in at least three foreign countries. The Fund mostly
invests in mature markets, but may also invest in emerging markets.

The Fund emphasizes companies with a market capitalization of at least $250
million.

At least once a quarter, the advisor creates a list of foreign securities and
American Depositary Receipts which the Fund may purchase based on the country
where the company is located, its competitive advantages, its past financial
record, its future prospects for growth and the market for its securities. The
advisor updates the securities list frequently (at least quarterly), adds new
securities to the list if they are eligible and sells securities not on the
updated securities list as soon as practicable.

After the advisor creates the securities list, it divides the list into two
sections. The first section is designed to provide broad coverage of
international markets. The second section increases exposure to securities that
the advisor expects will perform better than other stocks in their industry
sectors and their markets as a whole. When the advisor believes broader market
exposure will benefit the Fund, it will allocate up to 100% of the Fund's assets
in first section securities. When the advisor identifies strong potential for
specific securities to perform well, the Fund may invest up to 50% of its assets
in second section securities.

The Fund may also enter into futures and options on futures contracts, forward
currency exchange contracts and purchase and sell options.

Principal Risks

Among the principal risks of investing in the Fund are market risk, foreign
securities risk and currency risk. To the extent that the Fund enters into
futures and options on futures contracts, and forward currency exchange
contracts, and purchases and sells options, it may be subject to derivatives
risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year 5 Years Inception
- ------------------------ ------- --------- ----------
Class A (11/30/92)
Class B (3/9/94)
Class C (9/29/95)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

7
<PAGE>

Micro-Cap Equity Fund

Goal

The Fund's goal is to provide capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities of small capitalization companies. Small capitalization companies
means companies having a market capitalization within the range of the companies
included in the Wilshire Micro-Cap Index. As of the date of this prospectus,
such capitalizations do not exceed approximately $300 million, which is
considerably less than the market capitalization of S&P 500 companies.

The Fund attempts to provide investors with potentially higher returns than a
fund that invests primarily in larger, more established companies. Since smaller
capitalization companies are generally not as well known to investors and have
less of an investor following than larger companies, they may provide higher
returns due to inefficiencies in the marketplace.

The advisor will choose companies that:

. present the ability to grow significantly over the next several years;

. may benefit from changes in technology, regulations and industry sector
trends; and

. are still in the developmental stage and may have limited product lines.

There is no limit on the length of operating history for the companies in which
the Fund may invest. The Fund may also invest in equity securities of larger
capitalization companies. The Fund may invest without limit in initial public
offerings of small capitalization companies.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- ------------------------ -------- -----------
Class A (12/26/96)
Class B (2/24/97)
Class C (3/31/97)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

8
<PAGE>

Multi-season Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation. This goal is
"fundamental" and cannot be changed without shareholder approval.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities. The Fund generally invests in equity securities of companies with
market capitalizations over $1 billion. Its style, which focuses on both growth
prospects and valuation, is known as GARP (Growth at a Reasonable Price) and
seeks to produce attractive returns during various market environments.

The advisor chooses the Fund's investments by reviewing the earnings growth of
approximately 5,500 companies over the past five years and investing in
approximately 50 to 100 companies based on:

. superior earnings growth;

. financial stability;

. relative market value; and

. price changes compared to the S&P 500.

The Fund may also purchase foreign securities.

Principal Risks

Among the principal risks of investing in the Fund is market risk. To the extent
that the Fund purchases foreign securities, it may be subject to foreign
securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class B)

The annual returns in the bar chart are for the Fund's Class B Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year 5 Years Inception
- ----------------------------- -------- --------- ---------
Class A (8/4/93)
Class B (4/29/93)
Class C (9/20/93)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

_________________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

9
<PAGE>

Real Estate Equity Investment Fund

Goal

The Fund's goal is to provide both capital appreciation and current income. This
goal is "fundamental" and cannot be changed without shareholder approval.

Principal Investment Strategies

The Fund pursues its goal by investing, under normal market conditions, at least
65% of its total assets in equity securities of U.S. companies which are
principally engaged in the real estate industry or which own significant real
estate.

A company is "principally engaged" in the real estate industry if at least 50%
of its assets, gross income or net profits are attributable to ownership,
construction, management or sale of residential, commercial or industrial real
estate. The Fund will not own real estate directly.

The companies in which the Fund primarily invests include:

. equity real estate investment trusts ("REITS");

. brokers, home builders and real estate developers;

. companies with substantial real estate holdings (for example, paper and
lumber producers, hotels and entertainment companies);

. manufacturers and distributors of building supplies;

. Mortgage REITS; and

. financial institutions which issue or service mortgages.

In addition, the Fund may invest:

. up to 35% of its assets in companies other than real estate industry
companies;

. in fixed income securities including up to 5% of its assets in debt
securities rated below investment grade or unrated if secured by real
estate assets and if the advisor believes that the underlying collateral is
sufficient; and

. in REITS only if they are traded on a securities exchange or NASDAQ.

Principal Risks

Among the principal risks of investing in the Fund are market risk and sector
risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1995: _____%
1996: _____%
1997: _____%
1998: _____%

_______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- ---------------------- -------- -----------
Class A (9/30/94)
Class B (10/3/94)
Class C (1/5/96)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

_______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

10
<PAGE>

Small-Cap Value Fund

Goal

The Fund's goal is to provide long-term capital appreciation, with income as a
secondary objective.

Principal Investment Strategies

The Fund pursues its goal by investing, under normal market conditions, at least
65% of its assets in equity securities of small capitalization companies. Small
capitalization companies means companies with market capitalizations within the
range of the companies in the Russell 2000 Index. As of the date of this
prospectus, such capitalizations do not exceed approximately $1.5 billion, which
is less than the market capitalization of S&P 500 companies.

The Fund attempts to provide investors with potentially higher returns than a
fund that invests primarily in larger, more established companies. Since small
companies are generally not as well known to investors and have less of an
investor following than larger companies, they may provide higher returns due to
inefficiencies in the marketplace.

The advisor will concentrate on companies that it believes are undervalued. A
company's equity securities may be undervalued because the company is
temporarily overlooked or out of favor due to general economic conditions, a
market decline, industry conditions or developments affecting the particular
company. The Fund will usually invest in equity securities of companies with
price/earnings ratios, price/cash flow ratios and price/book values that are low
relative to the general market.

In addition to valuation, the advisor considers these factors, among others, in
choosing companies:

. a stable or improving earnings record;

. sound finances;

. above-average growth prospects;

. participation in a fast growing industry;

. strategic niche position in a specialized market; and

. adequate capitalization.

The Fund may invest in equity securities of larger capitalization companies.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk and small
company stock risk. To the extent that the Fund purchases foreign securities, it
may be subject to foreign securities risk. To the extent that the Fund enters
into futures and options on futures contracts, it may be subject to derivatives
risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1998: _____%

___________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- ----------------------- -------- -----------
Class A (1/10/97)
Class B (2/11/97)
Class C (1/13/97)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

________________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

11
<PAGE>

Small Company Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing, under normal market conditions, at least
65% of its assets in equity securities of small capitalization companies with
market capitalizations below $1 billion, which is less than the market
capitalization of S&P 500 companies.

The Fund attempts to provide investors with potentially higher returns than a
fund that invests primarily in larger, more established companies. Since smaller
capitalization companies are generally not as well-known to investors and have
less of an investor following than larger companies, they may provide higher
returns due to inefficiencies in the marketplace.

The advisor considers these factors, among others, in choosing companies:
. above-average growth prospects;
. participation in a fast-growing industry;
. strategic niche position in a specialized market; and
. adequate capitalization.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

____________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year 5 Years Inception
- ---------------------------- -------- --------- ---------
Class A (11/23/92)
Class B (4/28/94)
Class C (9/26/95)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

________________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

12
<PAGE>

Value Fund

Goal

The Fund's primary goal is to provide long-term capital appreciation. Its
secondary goal is to provide income.

Principal Investment Strategies

The Fund pursues its goals by investing primarily in the equity securities of
well-established companies with intermediate to large capitalizations, which
typically exceed $750 million.

The Fund will invest at least 65% of its assets in equity securities.

The advisor will focus on companies that it believes are undervalued. A
company's equity securities may be undervalued because the company is
temporarily overlooked or out of favor due to general economic conditions, a
market decline, industry conditions or developments affecting the particular
company. The Fund will usually invest in equity securities of companies with
price/earnings ratios, price/cash flow ratios and price/book values that are low
relative to the general market.

In addition to valuation, the advisor considers these factors, among others, in
choosing companies:
. a stable or improving earnings record;
. sound finances;
. above-average growth prospects;
. participation in a fast growing industry;
. strategic niche position in a specialized market; and
. adequate capitalization.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk and medium-
size company stock risk. To the extent that the Fund purchases foreign
securities, it may be subject to foreign securities risk. To the extent that the
Fund enters into futures and options on futures contracts, it may be subject to
derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1996: _____%
1997: _____%
1998: _____%

_______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year Inception
- ------------------------- -------- ---------
Class A (9/14/95)
Class B (9/19/95)
Class C (2/9/96)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

13
<PAGE>

Framlington Emerging Markets Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities of companies in emerging market countries, as defined by the World
Bank, the International Finance Corporation, the United Nations or the European
Bank for Reconstruction and Development.

A company will be considered to be in an emerging market country if:
. the company is organized under the laws of, or has a principal office in,
an emerging market country;
. the company's stock is traded primarily in an emerging market country;
. most of the company's assets are in an emerging market country; or
. most of the company's revenues or profits come from goods produced or sold,
investments made or services performed in an emerging market country.

The Fund may also invest in foreign securities of companies located in countries
with mature markets.

Principal Risks

Among the principal risks of investing in the Fund are market risk, foreign
securities risk, emerging markets risk, currency risk and medium-size company
stock risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year Inception
- -------------------------- -------- ---------
Class A (1/14/97)
Class B (2/25/97)
Class C (3/3/97)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

________________________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

14
<PAGE>

Framlington Global Financial Services Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities of U.S. and foreign companies which are principally engaged in the
financial services industry and companies providing services primarily within
the financial services industry. The Fund focuses specifically on companies
which are likely to benefit from growth or consolidation in the financial
services industry.

Examples of companies in the financial services industry are:
. commercial, industrial and investment banks;
. savings and loan associations;
. brokerage companies;
. consumer and industrial finance companies;
. real estate and leasing companies;
. insurance companies; and
. holding companies for each of the above.

A company is "principally engaged" in the financial services industry if at
least 50% of its gross income, net sales or net profits comes from activities in
the financial services industry or if the company dedicates more than 50% of its
assets to the production of revenues from the financial services industry.

The sub-advisor allocates assets among countries based on:
. its analysis of the trends in the financial services industry in particular
regions;
. the relative valuation of financial services companies in different
regions; and
. its assessment of the prospects for a particular equity market and its
currency.

Under normal market conditions, the Fund invests at least 65% of its assets in
at least three different countries, including the United States. The Fund may
invest in companies located in countries with mature markets and in those with
emerging markets.

The Fund may also enter into forward currency exchange contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk, sector risk,
foreign securities risk, currency risk and medium-size company stock risk. To
the extent that the Fund enters into forward currency exchange contracts, it may
be subject to derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

15
<PAGE>

Framlington Healthcare Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing in equity securities of companies
providing healthcare and medical services and products worldwide. Currently,
most of these companies are located in the United States.

The Fund will invest in:
. pharmaceutical producers;
. biotechnology firms;
. medical device and instrument manufacturers;
. distributors of healthcare products;
. healthcare providers and managers; and
. other healthcare service companies.

Under normal market conditions, the Fund will invest at least 65% of its assets
in healthcare companies, which are companies for which at least 50% of sales,
earnings or assets arise from or are dedicated to health services or medical
technology activities.

The Fund's investments may include foreign securities of companies located in
countries with mature markets.

Principal Risks

Among the principal risks of investing in the Fund are market risk, sector risk,
foreign securities risk, currency risk and medium-size company stock risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class C)

The annual returns in the bar chart are for the Fund's Class C Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year Inception
- ------------------------- -------- ---------
Class A (2/14/97)
Class B (1/31/97)
Class C (1/13/97)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

________________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

16
<PAGE>

Framlington International Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities of issuers located in at least three foreign countries.

The sub-advisor will choose companies that demonstrate:
. above-average profitability;
. high quality management; and
. the ability to grow significantly in their countries.

The Fund may invest in companies located in countries with mature markets and in
those with emerging markets. The Fund may also enter into forward currency
exchange contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk, foreign
securities risk, currency risk, emerging markets risk and medium-size company
stock risk. To the extent that the Fund enters into forward currency exchange
contracts, it may be subject to derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class C)

The annual returns in the bar chart are for the Fund's Class C Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year Inception
- ---------------------- -------- ---------
Class A (2/20/97)
Class B (3/19/97)
Class C (2/13/97)
[Index] *
Since inception of Class ___**
Since inception of Class ___**

________________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

17
<PAGE>

Summary of Principal Risks of the Funds

The share price of the Funds will change daily based on market conditions and
other factors. Therefore, you may lose money if you invest in the Funds.

The following summary briefly describes the principal risks that may affect a
Fund's portfolio as a whole. More information about the Funds' principal
investment strategies and their associated risks is contained in the section
entitled "More About the Funds."

SECTOR RISK is the risk of loss due to concentrating investments in a particular
industry sector. Adverse economic, business or political developments affecting
that industry sector could have a major effect on the value of the Fund's
investments. Real Estate Equity Investment Fund, Global Financial Services Fund
and Healthcare Fund are particularly subject to this Risk.

CREDIT (OR DEFAULT) RISK is the risk of loss because an issuer of a security may
default on its payment obligations. Also, an issuer may suffer adverse changes
in its financial condition that could lower the credit quality of a security,
leading to greater volatility in the price of the security and in shares of the
Fund. A change in the quality rating of a bond can affect the bond's liquidity
and make it more difficult for the Fund to sell. Funds particularly subject to
this risk are: Balanced Fund, Growth & Income Fund, Bond Fund, Intermediate Bond
Fund, International Bond Fund, U.S. Government Income Fund, Michigan Tax-Free
Bond Fund, Tax-Free Bond Fund, Tax-Free Short-Intermediate Bond Fund, Cash
Investment Fund and Tax-Free Money Market Fund.

DERIVATIVES RISK is the risk that loss may result from a Fund's use of futures
and options on futures contracts, options, forward currency exchange contracts
and other forms of derivative instruments. The primary risk with many
derivatives is that they can amplify a gain or loss, potentially earning or
losing substantially more money than the actual cost of the derivative
instrument. Funds particularly subject to this risk are: Balanced Fund,
International Equity Fund, Value Fund, Small-Cap Value Fund, Global Financial
Services Fund and International Growth Fund.

FOREIGN SECURITIES RISK is the risk of loss because investments by a Fund in
foreign securities may experience greater and more rapid change in value than
investments in U.S. securities. Foreign securities are generally more volatile
and less liquid than U.S. securities, in part because of greater political and
economic risks and because there is less public information available about
foreign companies. Issuers of foreign securities are generally not subject to
the same degree of regulation as are U.S. issuers. The reporting, accounting and
auditing standards of foreign countries may differ, in some cases significantly,
from U.S. standards. Funds particularly subject to this risk are: Balanced Fund,
Equity Selection Fund, Growth & Income Fund, Growth Opportunities Fund,
International Equity Fund, Micro-Cap Equity Fund, Small-Cap Value Fund, Small
Company Growth Fund, Multi-Season Growth Fund, Value Fund, Emerging Markets
Fund, Global Financial Services Fund, Healthcare Fund and International Growth
Fund.

Currency Risk. Funds that invest in foreign securities denominated in
foreign currencies may also be subject to currency risk. This is the
risk of loss because a decline in the value of foreign currencies
relative to the U.S. dollar will reduce the value of a Fund's portfolio
securities denominated in those currencies. Funds particularly subject
to this risk are: International Equity Fund, Emerging Markets Fund,
Global Financial Services Fund, Healthcare Fund and International
Growth Fund.

Emerging Markets Risk. Funds that invest in foreign securities of
issuers in emerging market countries are subject to emerging markets
risk. Investing in emerging market countries heightens the risks
presented by investing in foreign securities and currencies and may
result in loss to the Fund. Numerous emerging countries have recently
experienced serious, and potentially continuing, economic and political
problems. Stock markets in many emerging countries are relatively small
and risky. Foreigners are often limited in their ability to invest in,
and withdraw assets from, these markets. Additional restrictions may be
imposed under emergency conditions. Funds particularly subject to this
risk are:
International Equity Fund, Emerging Markets Fund and International Growth
Fund.

18
<PAGE>

MARKET RISK is the risk of loss because the value of the securities in which a
Fund invests may decline in response to general economic conditions. Price
changes may be temporary or last for extended periods. For example, stock prices
have historically risen and fallen in periodic cycles. In addition, the value of
Fund's investments may decline if the particular companies the Funds invest in
do not perform well. All of the Munder Equity Funds are subject to this risk.

MEDIUM-SIZE COMPANY STOCK RISK is the risk of loss because the stocks of
medium-size companies may be more susceptible to market downturns, and their
prices may be more volatile than the stocks of larger companies. Equity
Selection Fund, Growth Opportunities Fund, Value Fund, Emerging Markets Fund,
Global Financial Services Fund, International Growth Fund and Healthcare Fund
are particularly subject to this risk.

PREPAYMENT RISK is the risk that a Fund may experience losses when an issuer
exercises its right to pay principal on an obligation held by the Fund (such as
a mortgage-backed security) earlier than expected. This may happen during a
period of declining interest rates. Under these circumstances, the Fund may be
unable to recoup all of its initial investment and will suffer from having to
reinvest in lower yielding securities. The loss of higher yielding securities
and the reinvestment at lower interest rates can reduce the Fund's income, total
return and share price. The Balanced Fund is particularly subject to this risk.

SMALL COMPANY STOCK RISK is the risk of loss because the stocks of small
companies may have more risks than those of larger companies. Small companies
often have narrower markets and more limited managerial and financial resources
than larger, more established companies. As a result, they may be more sensitive
to changing economic conditions, which could increase the volatility of a Fund's
portfolio. In addition, small company stocks typically are traded in lower
volume making them more difficult to sell. Funds particularly subject to this
risk are: Micro-Cap Equity Fund, Small Cap Value Fund, Small Company Growth Fund
and Healthcare Fund.

19
<PAGE>

Who May Want to Invest

The Funds may be appropriate for investors:

. Looking to invest over the long term and willing to ride out market swings
in search of potentially higher returns.

. Looking for an investment that has more return and risk potential than
fixed income investments.

20
<PAGE>

Fees And Expenses

include fees that institutions may charge for services they provide to you.

<TABLE>
<CAPTION>
Class A Class B Class C
Shareholder Fees (fees paid directly from your investment) Shares Shares Shares
------- ------- -------
<S> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases............ 5.5%(a) None None
Sales Charge (Load) Imposed on Reinvested Dividends......... None None None
Maximum Deferred Sales Charge (Load)........................ None(b) 5%(c) 1%(d)
Redemption Fees............................................. None None None
Exchange Fees............................................... None None None
</TABLE>

Annual Fund Operating Expenses (expenses that are paid from Fund assets) And
Examples

The examples are intended to help you compare the cost of investing in each Fund
to the cost of investing in other mutual funds. The examples assume that you
invest $10,000 in the Fund for the time periods indicated. The examples also
assume that your investment has a 5% return each year, that the Fund's operating
expenses remain the same as shown in the table and that all dividends and
distributions are reinvested. Your actual costs may be higher or lower.

Equity Selection Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------

Management Fees .75% .75% .75% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====

Growth & Income Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------

21
<PAGE>

Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees .75% .75% .75% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses (2) [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses (3) [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====

International Equity Fund

Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
Management Fees .75% .75% .75% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====

Micro-Cap Equity Fund

Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
Management Fees 1.00% 1.00% 1.00% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses(2) [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses(3) [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====

Multi-Season Growth Fund

Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
Management Fees(1) [ ]% [ ]% [ ]% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses(3) [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====

Real Estate Equity Investment Fund

Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
Management Fees .74% .74% .74% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====

Small-Cap Value Fund

Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
Management Fees .75% .75% .75% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====
</TABLE>

22
<PAGE>

Annual Fund Operating Expenses
as a % of net assets Examples
- ---------------------------------------------------------- --------------------------------------------------------------------
Small Company Growth Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- ------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees .75% .75% .75% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
------- ------- -------
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======= ======= =======

Value Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- -------- -------- ------- --------
Management Fees .74% .74% .74% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
------- ------- -------
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======= ======= =======

Framlington Emerging Markets Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- ------- -------- ------- --------
Management Fees 1.25% 1.25% 1.25% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses(2) [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
------- ------- -------
Total Annual Fund
Operating Expenses(3) [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======= ======= =======

Framlington Global Financial Services Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------ ------- ------- -------- ------- --------
Management Fees .75% .75% .75% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses(2) [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
------- ------- -------
Total Annual Fund
Operating Expenses(3) [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======= ======= =======

Framlington Healthcare Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- -------- -------- ------- --------
Management Fees 1.00% 1.00% 1.00% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses(2) [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
------- ------- -------
Total Annual Fund
Operating Expenses(3) [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======= ======= =======
</TABLE>

23
<PAGE>

<TABLE>
<CAPTION>
Annual Fund Operating Expenses
as a % of net assets Examples
- ---------------------------------------------------------- ------------------------------------------------------------------
Framlington International Growth Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- ------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees 1.00% 1.00% 1.00% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses(2) [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
------- ------- -------
Total Annual Fund
Operating Expenses(3) [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======= ======= =======
</TABLE>
______________________
(a) The sales charge declines as the amount invested increases.
(b) A contingent deferred sales charge (CDSC) is a one-time fee charged at the
time of redemption. A 1% CDSC applies to redemptions of Class A shares within
one year of investment that were purchased with no initial sales charge as part
of an investment of $1,000,000 or more. (c) The CDSC payable upon redemption of
Class B shares declines over time. (d) The CDSC applies to redemptions of Class
C shares within one year of purchase.
(1) For the fiscal year ended June 30, 1999, the advisor voluntarily waived a
portion of its management fees. As a result of the fee waiver, actual
management fees paid, based on the Multi-Season Growth Fund's average daily
net assets, were [ ]%.
(2) For the fiscal year ended June 30, 1999, the advisor voluntarily reimbursed
certain operating expenses. As a result of the expense reimbursement, actual
Other Expenses paid by the Funds, were:

Fund Other Operating Expenses
____ (as a % of average daily net assetts)
-----------------------------------

Growth Opportunities Fund %
Micro-Cap Equity Fund %
Framlington Emerging Markets Fund %
Framlington Financial Services Fund %
Framlington Healthcare Fund %
Framlington International Growth Fund %

(3) For the fiscal year ended June 30, 1999, as a result of the advisor's
voluntary fee waivers and expense reimbursements, the actual Total Annual
Fund Operating Expenses paid by the Funds were as shown below. The advisor
may terminate the fee waivers and/or expense reimbursements at any time.

Fund Total Annual Fund Operating Expenses
---- (as a % of average daily net assets)
------------------------------------

Multi-Season Growth Fund
Growth Opportunities Fund %
Micro-Cap Equity Fund %
Framlington Emerging Markets Fund %
Framlington Global Financial Services Fund %
Framlington Healthcare Fund %
Framlington International Growth Fund %

*Assumes you sold your shares at the end of the time period.
**Assumes you stayed in the Fund.
***Reflects conversion of Class B shares to Class A shares (which pay lower
ongoing expenses) approximately six years after the date of original purchase.

24
<PAGE>

More About The Funds
- --------------------------------------------------------------------------------

The Funds' principal investment strategies and risks are summarized above in the
section entitled Risk/Return Summary. A more complete description of each Fund's
investments and strategies and their associated risks is provided below under
"Special Risks and Other Considerations" and "Additional Descriptions of
Investments and Investment Strategies." The Funds may also invest in other
securities and are subject to further restrictions and risks which are described
in the Statement of Additional Information. The Glossary below explains certain
terms used throughout this prospectus.

Glossary

Types Of Funds

Equity Funds are the Balanced Fund, Equity Selection Fund, Growth & Income Fund,
Growth Opportunities Fund, International Equity Fund, Micro-Cap Equity Fund,
Multi-Season Growth Fund, Real Estate Equity Investment Fund, Small-Cap Value
Fund, Small Company Growth Fund, Value Fund, Framlington Emerging Markets Fund,
Framlington Global Financial Services Fund, Framlington Health Care Fund and
Framlington International Growth Fund.

Types Of Securities

Equity securities include common stocks, preferred stocks, securities
convertible into common stocks, and rights and warrants to subscribe for the
purchase of common stocks. Equity securities may be listed on a stock exchange
or NASDAQ National Market System or unlisted. Warrants are rights to purchase
securities at a specified time at a specified price.

Fixed income securities are securities that pay interest at set times at either
fixed, floating or variable rates, or which are issued at a discount to their
principal amount instead of making periodic interest payments. Fixed income
securities include corporate bonds, debentures and other similar corporate debt
instruments, zero coupon bonds and variable amount master demand notes.

Convertible securities are bonds or preferred stocks that may be converted
(exchanged) into the common stock of the issuing company within a specified time
period for a specified number of shares. Convertible securities offer the Funds
a way to participate in the capital appreciation of the common stock into which
the securities are convertible, while earning higher current income than is
available from the common stock.

U.S. Government securities are securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. These securities include U.S.
Treasury bills, U.S. Treasury notes, U.S. Treasury bonds and obligations of the
Federal Home Loan Corporation, Federal National Mortgage Association and
Government National Mortgage Association.

Money market instruments are high-quality, short-term instruments including
commercial paper, bankers' acceptances and negotiable certificates of deposit of
banks or savings and loan associations, short-term corporate obligations and
short-term U.S. Government securities.

Rating Agencies And Indices

Moody's is Moody's Investor Services, Inc.

Duff & Phelps is Duff & Phelps Credit Rating Co.

Fitch is Fitch IBCA, Inc.

S&P is Standard & Poor's Rating Services.

S&P 500 is S&P's 500 Composite Stock Price Index, a widely recognized unmanaged
index of stock market activity.

Other

1940 Act is the Investment Company Act of 1940, as amended.

Internal Revenue Code is the Internal Revenue Code of 1986, as amended.

NAV is the net asset value per share of a Fund. NAV is the value of a single
share of a Fund. Each Fund calculates NAV separately for each class. NAV is
calculated by (1) taking the current value of a Fund's total assets allocated to
a particular class of shares, (2) subtracting the liabilities and expenses
charged to that class (3) dividing that amount by the total number of shares of
that class outstanding.

25
<PAGE>

A diversified investment company is an investment company that may not invest
more than 5% of its total assets in any one issuer other than the U.S.
Government, its agencies or instrumentalities. This limit applies only to 75% of
a diversified Fund's assets. In addition, a diversified Fund cannot invest more
than 25% of its assets in a single issuer. These limitations do not apply to the
non-diversified Funds.

Special Risks And Other Considerations

Derivative Risk. "Derivative" instruments are financial contracts whose value is
based on an underlying security, a currency exchange rate, an interest rate or a
market index. Many types of instruments representing a wide range of potential
risks and rewards are derivatives, including futures contracts, options on
futures contracts, options, swaps, forward currency contracts and structured
debt obligations (including collateralized mortgage obligations and other types
of asset-backed securities, "stripped" securities and various floating rate
instruments).

Investment Strategy. Derivatives can be used for hedging (attempting to
reduce risk by offsetting one investment position with another) or
speculation (taking a position in the hope of increasing return). The
Funds may, but are not required to, use derivatives for hedging
purposes or for the purpose of remaining fully invested or maintaining
liquidity. The Funds will not use derivatives for speculative purposes.

Special Risks. The use of derivative instruments exposes a Fund to
additional risks and transaction costs. Risks of derivative instruments
include: (1) the risk that interest rates, securities prices and
currency markets will not move in the direction that a portfolio
manager anticipates; (2) imperfect correlation between the price of
derivative instruments and movements in the prices of the securities,
interest rates or currencies being hedged; (3) the fact that skills
needed to use these strategies are different than those needed to
select portfolio securities; (4) the possible absence of a liquid
secondary market for any particular instrument and possible exchange
imposed price fluctuation limits, either of which may make it difficult
or impossible to close out a position when desired; (5) the risk that
adverse price movements in an instrument can result in a loss
substantially greater than the Fund's initial investment in that
instrument (in some cases, the potential loss is unlimited); (6)
particularly in the case of privately-negotiated instruments, the risk
that the counterparty will not perform its obligations, which could
leave the Fund worse off than if it had not entered into the position;
and (7) the inability to close out certain hedged positions to avoid
adverse tax consequences.

Foreign Investment Risk. Foreign securities include direct investments in
non-U.S. dollar-denominated securities traded outside of the United States and
dollar-denominated securities of foreign issuers traded in the United States.
Foreign securities also include indirect investments such as American Depository
Receipts ("ADRs"), European Depository Receipts ("EDRs") and Global Depository
Receipts ("GDRs"). ADRs are U.S. dollar-denominated receipts representing shares
of foreign-based corporations. ADRs are issued by U.S. banks or trust companies,
and entitle the holder to all dividends and capital gains that are paid out on
the underlying foreign shares. EDRs and GDRs are receipts issued by non-U.S.
financial institutions that often trade on foreign exchanges. They represent
ownership in an underlying foreign or U.S. security and are generally
denominated in a foreign currency.

Investment Strategy. International Equity Fund, Framlington Global
Financial Services Fund, Framlington Healthcare Fund and Framlington
International Growth Fund will invest all or a substantial portion of
their total assets in foreign securities. The other Equity Funds
(except Real Estate Investment Fund), may invest up to 25% of their
total assets in foreign securities.

Special Risks. Foreign securities involve special risks and costs.
Investment in the securities of foreign governments involves the risk
that foreign governments may default on their obligations or may
otherwise not respect the integrity of their debt.

Investment in foreign securities may involve higher costs than
investment in U.S. securities, including higher transaction and custody
costs as well as the imposition of

26
<PAGE>

additional taxes by foreign governments. Foreign investments may also
involve risks associated with the level of currency exchange rates, less
complete financial information about the issuers, less market liquidity,
more market volatility and political instability. Future political and
economic developments, the possible imposition of withholding taxes on
dividend income, the possible seizure or nationalization of foreign
holdings, the possible establishment of exchange controls or freezes on
the convertibility of currency, or the adoption of other governmental
restrictions might adversely affect an investment in foreign securities.
Additionally, foreign issuers may be subject to less stringent
regulation, and to different accounting, auditing and recordkeeping
requirements.

Currency exchange rates may fluctuate significantly over short periods
of time causing a Fund's net asset value to fluctuate as well. A
decline in the value of a foreign currency relative to the U.S. dollar
will reduce the value of a foreign currency-denominated security. To
the extent that a Fund is invested in foreign securities while also
maintaining currency positions, it may be exposed to greater combined
risk. The Funds' respective net currency positions may expose them to
risks independent of their securities positions.

Additional risks are involved when investing in countries with emerging
economies or securities markets. In general, the securities markets of
these countries are less liquid, are subject to greater price
volatility, have smaller market capitalizations and have problems with
securities registration and custody. In addition, because the
securities settlement procedures are less developed in these countries,
a Fund may be required to deliver securities before receiving payment
and may also be unable to complete transactions during market
disruptions. As a result of these and other risks, investments in these
countries generally present a greater risk of loss to the Fund.

A further risk of investing in foreign securities is the risk that a
Fund may be adversely affected by the conversion of certain European
currencies into the Euro. This conversion, which is under way, is
scheduled to be completed in the year 2002. However, problems with the
conversion process and delays could increase volatility in world
markets and affect European markets in particular.

Investments in Financial Services Companies by Framlington Global Financial
Services Fund. Financial services companies are subject to extensive
governmental regulation which may limit the financial commitments they can make,
and the interest rates and fees they can charge. Insurance companies may be
subject to severe price competition. Proposed legislation that would reduce the
separation between commercial and investment banking businesses, if enacted,
could significantly impact the industry and the Fund. The Fund may be riskier
than a fund investing in a broader range of industries.

Investments in the Healthcare Industry by Framlington Healthcare Fund. The Fund
will invest most of its assets in the healthcare industry, which is particularly
affected by rapidly changing technology and extensive government regulation,
including cost containment measures. The Fund may be riskier than a fund
investing in a broader range of industries.

Investments in the Real Estate Industry by Real Estate Equity Investment Fund.
The Fund will invest primarily in the real estate industry and may invest more
than 25% of its assets in any one sector of the real estate industry. As a
result, the Fund will be particularly vulnerable to declines in real estate
prices and new construction rates. The Fund may be riskier than a fund investing
in a broader range of industries.

Investment Grade Credit Risk. A security is considered investment grade if, at
the time of purchase, it is rated:

. BBB or higher by S&P;
. Baa or higher by Moody's;
. BBB or higher by Duff & Phelps; or
. BBB or higher by Fitch.

A security will be considered investment grade if it receives one of the above
ratings, even if it receives a lower rating from other rating organizations.

Investment Strategy. Except as stated in the next section, fixed income
and

27
<PAGE>

convertible securities purchased by the Funds will generally be rated at
least investment grade. The Funds may also invest in unrated securities
if the advisor or sub-advisor believes they are comparable in quality.

Special Risks. Although securities rated "BBB" by S&P, Duff & Phelps or
Fitch, or Baa by Moody's are considered investment grade, they have
certain speculative characteristics. Therefore, they may be subject to
a higher risk of default than obligations with higher ratings.
Subsequent to its purchase by a Fund, a rated security may cease to be
rated or its rating may be reduced below the minimum rating required
for purchase by the Fund. The advisor or sub-advisor will consider such
an event in determining whether the Fund should continue to hold the
security.

Non-Investment Grade Credit Risk. Non-investment grade fixed income and
convertible securities are generally rated "BB" or below by S&P, Duff & Phelps
or Fitch, or "Ba" by Moody's.

Investment Strategy. Each Fund may invest a portion of their total
assets in non-investment grade securities when the advisor or
sub-advisor determines that such securities are desirable in light of
the Funds' investment objectives and portfolio mix.

Special Risks. Non-investment grade securities (sometimes referred to
as "junk bonds") are subject to greater risk than investment grade
securities. They generally present a higher degree of credits risks
(default). In addition, the market value of these securities tends to
be more sensitive to individual corporate developments and to changes
in interest rates and other economic developments than higher-rated
securities.

Short-Term Trading. The Funds' historical portfolio turnover rates are shown in
the Financial Highlights.

Investment Strategy. Each Fund may engage in short-term trading,
including, initial public offerings.

Special Risks. A high rate of portfolio turnover (100% or more) could
produce higher trading costs and taxable distributions, which could
detract from a Fund's performance.

Defensive Investing. Each Fund may invest all or any portion of its assets in
short-term obligations as a temporary defensive
measure in response to adverse market or economic conditions.

Special Risks. A Fund may not achieve its investment objective when its
assets are invested in short-term obligations.

Year 2000 Risk. Like other mutual funds, financial institutions, business
organizations and individuals around the world, the Funds could be adversely
affected if the computer systems used by the advisor and the Funds' other
service providers do not properly process and calculate date-related information
and data from and after January 1, 2000. The advisor is taking steps that it
believes are reasonably designed to address year 2000 computer-related problems
with respect to the computer systems that it uses and to obtain assurances that
comparable steps are being taken by the Funds' other major service providers.
Although there can be no assurances, the advisor believes that these steps will
be sufficient to avoid any adverse impact on any of the Funds. Similarly, there
can be no assurance that year 2000 issues will not affect the companies and
other issuers in which the Funds invest or affect worldwide markets and
economies.

28
<PAGE>

Additional Description Of Investments And Investment Strategies

Asset-Backed Securities. Asset-backed securities are debt securities backed by
mortgages, installment sales contract and credit card receivables. The
securities are sponsored by entities such as government agencies, banks,
financial companies and commercial or industrial companies. In effect, these
securities "pass through" the monthly payments that individual borrowers make on
their mortgage or other assets net of any fees paid to the issuers. Examples of
these include guaranteed mortgage pass-through certificates, collateralized
mortgage obligations ("CMOs") and real estate mortgage investment conduits
("REMICs").

Investment Strategy. Framlington Global Financial Services Funds may
invest a portion of its assets in Asset-Backed
Securities.

Special Risks. In addition to credit and market risk, asset-backed
securities involve repayment risk because the underlying assets (loans)
may be prepaid at any time. The value of these securities may also
change because of actual or perceived changes in the creditworthiness
of the originator, the servicing agent, the financial institution
providing the credit support, or the counterparty. Like other fixed
income securities, when interest rates rise the value of an
asset-backed security generally will decline. However, when interest
rates decline, the value of an asset-backed security with prepayment
features may not increase as much as that of other fixed income
securities. In addition, non-mortgage asset-backed securities involve
certain risks not presented by mortgage-backed securities. Primarily,
these securities do not have the benefit of the same security interest
in the underlying collateral.

Investment Strategy. Each Fund may borrow money in an amount up to 5%
of its assets for temporary emergency purposes and in an amount up to
33 1/3% of its assets to meet redemptions. This is a fundamental policy
which can be changed only by shareholders.

Special Risks. Borrowings and reverse repurchase agreements by a Fund
may involve leveraging. If the securities held by the Fund decline in
value while these transactions are outstanding, the Fund's net asset
value will decline in value by proportionately more than the decline in
value of the securities. In addition, reverse repurchase agreements
involve the risks that the interest income earned by the Fund (from the
investment of the proceeds) will be less than the interest expense of
the transaction, that the market value of the securities sold by the
Fund will decline below the price the Fund is obligated to pay to
repurchase the securities, and that the securities may not be returned
to the Fund.

Forward Currency Exchange Contracts. A forward currency exchange contract is an
obligation to exchange one currency for another on a future date at a specified
exchange rate.

Investment Strategy. Forward currency exchange contracts may be used
for hedging purposes and to help reduce the risks and volatility caused
by changes in foreign currency exchange rates. Foreign currency
exchange contracts will be used at the discretion of the advisor or
sub-advisor, and no Fund is required to hedge its foreign currency
positions.

Special Risks. Forward currency contracts are privately negotiated
transactions, and can have substantial price volatility. When used for
hedging purposes, they tend to limit any potential gain that may be
realized if the value of a Fund's foreign holdings increases because of
currency fluctuations.

29
<PAGE>

the option period. When a Fund sells an option on a futures contract, it becomes
obligated to purchase or sell a futures contract if the option is exercised.

Investment Strategy. Each Fund may invest in futures contracts and
options on futures contracts on domestic or foreign exchanges or boards
of trade. These instruments may be used for hedging purposes, to
maintain liquidity to meet potential shareholder redemptions, to invest
cash balances or dividends, or to minimize trading costs.

A Fund will not purchase or sell a futures contract unless, after the
transaction, the sum of the aggregate amount of margin deposits on its
existing futures positions and the amount of premiums paid for related
options used for non-hedging purposes is 5% or less of the Fund's total
assets.

Special Risks. Futures contracts and related options present the
following risks: imperfect correlation between the change in market
value of a Fund's securities and the price of futures contracts and
options; the possible inability to close a futures contract when
desired; losses due to unanticipated market movements, which are
potentially unlimited; and the possible inability of the advisor or
sub-advisor to correctly predict the direction of securities prices,
interest rates, currency exchange rates and other economic factors.

Guaranteed Investment Contracts. Guaranteed investment contracts are agreements
by a Fund to make payments to an insurance company's general account in exchange
for a minimum level of interest based on an index.

Special Risks. Guaranteed investment contracts are considered illiquid
investments and are acquired subject to a Fund's limitation on illiquid
investments.

Investment Strategy. Each Fund may invest up to 15% of its net assets in
securities that are illiquid.

Special Risks. To the extent that a Fund invests in illiquid
securities, the Fund risks not being able to sell the securities at the
time and the price that it would like. The Fund may have to lower the
price, sell substitute securities or forego an investment opportunity,
each of which may cause a loss to the Fund.

Investment Companies. To the extent consistent with their respective investment
objectives and policies, the Funds may invest in securities issued by other
investment companies.

Investment Strategy. Investments by a Fund in other investment companies
will be subject to the limitations of the 1940 Act.

Special Risks. As a shareholder of another investment company, a Fund
would be subject to the same risks as any other investor in that
company. In addition, it would bear a proportionate share of any fees
and expenses paid by that company. These would be in addition to the
advisory and other fees paid directly by the Fund.

Municipal Obligations. Municipal obligations may include: (i) general obligation
bonds issued for various public purposes and supported by the municipal issuer's
credit and taxing power; and (ii) revenue bonds whose principal and interest is
payable only from the revenues of a particular project or facility.

Special Risks. Industrial revenue bonds depend on the credit standing of
a private issuer and may be subject to the federal alternative minimum
tax (AMT).

Options. An option is a type of derivative instrument that gives the holder the
right (but not the obligation) to buy (a "call") or sell (a "put") an asset in
the future at an agreed upon price prior to the expiration date of the option.

Investment Strategy. Each Fund may write (sell) covered call options,
buy put options, buy call options and write secured put options for
hedging purposes. Options may relate to particular securities, foreign
or domestic securities indices, financial instruments or foreign
currencies.

Special Risks. The value of options can be highly volatile, and their
use can result in

30
<PAGE>

loss if the advisor or sub-advisor is incorrect in
its expectation of price fluctuations. The successful use of options
for hedging purposes also depends in part on the ability of the advisor
or sub-advisor to predict future price fluctuations and the degree of
correlation between the options and securities markets.

Repurchase Agreements. Repurchase agreements involve the purchase of securities
by a Fund subject to the seller's agreement to repurchase them at a mutually
agreed upon date and price.

Investment Strategy. Each Fund may enter into repurchase agreements with
banks and broker-dealers that are deemed to be creditworthy by the
advisor or sub-advisor.

Special Risks. If the seller defaults or declares bankruptcy, a Fund
may suffer if the proceeds from the sale of the underlying securities
and other collateral are less than the repurchase price or if there are
delays in selling the underlying securities or collateral.

Securities Lending. In order to generate additional income, each Fund may lend
securities on a short-term basis to qualified institutions. By reinvesting any
cash collateral it receives in these transactions, the Fund could realize
additional income gains or losses.

Investment Strategy. Securities lending may represent no more than 25% of
the value of a Fund's total assets (including the loan collateral).

Special Risks. The main risk when lending Fund securities is that if
the borrower fails to return the securities or the invested collateral
has declined in value, the Fund could lose money.

Special Risks. Stripped securities are very sensitive to changes in
interest rates and to the rate of principal repayments. A rapid or
unexpected increase in mortgage prepayments could severely depress the
price of certain stripped mortgage-backed securities and adversely
affect a Fund's total returns.

Temporary Investments. Short-term obligations refer to U.S. Government
securities, high-quality money market instruments and repurchase agreements with
maturities of 13 months or less. Generally, these obligations are purchased to
provide stability and liquidity to a Fund.

Investment Strategy. Each Fund may invest a portion of its assets in
short-term obligations pending investment or to meet anticipated
redemption requests.

Special Risks. A Fund may not achieve its investment objective when its
asset are invested in short-term obligations.

Variable and Floating Rate Instruments. Variable and floating rate instruments
have interest rates that are periodically adjusted either at set intervals or
that float at a margin above a generally recognized index rate. These
instruments include variable amount master demand notes.

Special Risks. Variable and floating rate instruments are subject to
the same risks as fixed income investments, particularly interest rate
risk and credit risk. Because there is no active secondary market for
certain variable and floating rate instruments, they may be more
difficult to sell if the issuer defaults on its payment obligations or
during periods when a Fund is not entitled to exercise its demand
rights. As a result, the Fund could suffer a loss with respect to these
instruments.
When - Issued Securities, Delayed Delivery Transactions and Forward Commitments.
A purchase of "when-issued" securities refers to a transaction made
conditionally because the securities, although authorized, have not yet been
issued. A delayed delivery or forward commitment transaction involves a contract
to purchase or sell securities for a fixed price at a future date beyond the
customary settlement period.

Special Risks. Purchasing or selling securities on a when-issued,
delayed delivery or forward commitment basis involves the risk that the
value of the

31
<PAGE>

securities may change by the time they are actually issued
or delivered. These transactions also involve the risk that the seller
may fail to deliver the security or cash on the settlement date.

Zero Coupon Bonds. These are securities issued at a discount from their face
value because interest payments are typically postponed until maturity.

Special Risks. The market prices of zero coupon bonds generally are
more volatile than the market prices of interest-bearing securities and
are likely to respond to a greater degree to changes in interest rates
than interest-bearing securities having similar maturities and credit
quality. A Fund's investments in zero coupon bonds may require the Fund
to sell some of its portfolio securities to generate sufficient cash to
satisfy certain income distribution requirements.

32
<PAGE>

Your Investment
- --------------------------------------------------------------------------------

This section describes how to do business with the Funds.

How To Reach The Funds

By telephone: 1-800-438-5789
Call for shareholder services.

By mail: The Munder Funds
480 Pierce Street
Birmingham, Michigan 48009

Purchasing Shares

Purchase Price of Shares
Class A shares of a Fund are sold at the NAV next determined after a purchase
order is received in proper form plus any applicable sales charge. Please see
"Distribution Arrangements" below for information about sales charges.

Class B and Class C shares of a Fund are sold at NAV next determined after a
purchase order is received in proper form.

Broker-dealers (other than the Funds' distributor) may charge you additional
fees for shares you purchase through them.

Policies for Purchasing Shares

Investment minimums
. Initial: $250

. Subsequent: $ 50

. Automatic Investment Plan: $ 50

Purchases over $250,000 must be for Class A or Class C shares.

Timing of orders
Purchase orders must be received by the Funds' distributor or transfer agent
before the close of regular trading on the New York Stock Exchange (normally,
4:00 p.m. Eastern time).

Methods for Purchasing Shares Investors may purchase shares:
. By Broker. Any broker authorized by the Funds' distributor can sell you
shares of the Funds. Please note that brokers may charge you fees for their
services.

. By Mail. You may open an account by completing, signing and mailing the
attached account application form and a check or other negotiable bank
draft (payable to The Munder Funds) for $250 or more to: The Munder Funds,
c/o First Data Investor Services Group, P.O. Box 60428, King of Prussia,
Pennsylvania 19406-0428. Be sure to specify on your account application
form the class of shares being purchased. If the class is not specified,
your purchase will automatically be invested in Class A shares. For
additional investments, send a letter stating the Fund and share class you
wish to purchase, your name and your account number with a check for $50 or
more to the address listed above. [We do not accept third-party checks.]

. By Wire. To open a new account, you should call the Funds at (800) 438-5789
to obtain an account number and complete wire instructions prior to wiring
any funds. Within seven days of purchase, you must send a completed account
application form containing your certified taxpayer identification number
to the Funds' transfer agent at The Munder Funds, c/o First Data Investor
Services Group, P.O. Box 60428, King of Prussia, Pennsylvania 19406-0428.
Wire instructions must state the Fund name, share class, your registered
name and your account number. Your bank wire should be sent through the
Federal Reserve Bank Wire System to:

Boston Safe Deposit and Trust Company
Boston, MA
ABA# 011001234
DDA# 16-798-3
Account No.:

33
<PAGE>

You may make additional investments at any time using the wire procedures
described above. Note that banks may charge fees for transmitting wires.

. You may purchase shares through the Automatic Investment Plan.

. You may purchase shares through the Reinvestment Privilege.

Exchanging Shares

Policies for Exchanging Shares
. You may exchange your Fund for shares of the same class of other Munder
Funds based on their relative net asset values.

. [Class A shares of a Munder money market fund that were (1) acquired
through the use of the exchange privilege and (2) can be traced back to a
purchase of shares in one or more Munder Funds for which a sales charge was
paid, can be exchanged for Class A shares of a Fund.]

. Class B and Class C shares will continue to age from the date of the
original purchase and will retain the same CDSC rate as they had before the
exchange.

. You must meet the minimum purchase requirements for the Munder Fund that you
purchase by exchange.

. If you are exchanging into shares of a Munder Fund with a higher sales
charge, you must pay the difference at the time of the exchange.

. A share exchange is a taxable event and, accordingly, you may realize a
taxable gain or loss.

. Before making an exchange request, read the prospectus of the Munder Fund
you wish to purchase by exchange. You can obtain a prospectus for any
Munder Fund by contacting your broker or calling the Munder Funds at (800)
438-5789.

. Brokers may charge you a fee for handling exchanges.

. We may change, suspend or terminate the exchange privilege at any time. You
will be given notice of any material modifications except where notice is
not required.

Methods for Exchanging Shares
. Exchanges By Telephone. You may give exchange instructions by telephone to
the Funds at (800) 438-5789. You may not exchange shares by telephone if
you hold share certificates. We reserve the right to reject any telephone
exchange request and to place restrictions on telephone exchanges.

. Exchanges By Mail. You may send exchange requests to your broker or you may
send them directly to the Funds' transfer agent at The Munder Funds, c/o
First Data Investor Services Group, P.O. Box 60428, King of Prussia,
Pennsylvania 19406-0428.

Redeeming Shares

Redemption Price
We will redeem shares at the NAV next determined after we receive the redemption
request in proper form. We will reduce the amount you receive by the amount of
any applicable contingent deferred sales charge (CDSC).

Please see "Distribution Arrangements" below for information about CDSCs.

Policies for Redeeming Shares

. For your protection, a signature guarantee is required for the following
redemption requests: (a) redemption proceeds greater than $50,000; (b)
redemption proceeds not being made payable to the record owner of the
account; (c) redemption proceeds not being mailed to the address of record
on the account or (d) if the redemption proceeds are being transferred to
another Munder Fund account with a different registration. You can obtain a
signature guarantee from a financial institution such as a commercial bank,
trust company, savings association or from a securities firm having
membership on a recognized securities exchange.

34
<PAGE>

Methods for Redeeming Shares
You may redeem shares of the Funds in several ways:

. By Mail. You may mail your redemption request to: The Munder Funds, c/o
First Data Investor Services Group, P.O. Box 60428, King of Prussia,
Pennsylvania 19406-0428. The redemption request should state the name of
the Fund, share class, account number, amount of redemption, account name
and where to send the proceeds. All account owners must sign.

. By Telephone. You can redeem your shares by contacting your broker or
by calling the Funds at (800) 438-5789. There is no
minimum requirement for telephone redemptions.

If you are redeeming at least $1,000 of shares and you have authorized
expedited redemption on your account application form, simply call the
Funds prior to 4:00 p.m. (Eastern time), and request the redemption
proceeds be mailed to the commercial bank or registered broker-dealer you
designated on your account application form. We will send your redemption
proceeds to you on the next business day. We reserve the right at any time
to change or impose fees for this expedited redemption procedure.

During periods of unusual economic or market activity, you may experience
difficulties or delays in effecting telephone redemptions. In such cases
you should consider placing your redemption request by mail.

. You may redeem shares through the Automatic Withdrawal Plan.

Additional Policies For Purchases, Exchanges And
Redemptions

. We consider orders to be in "proper form" when all required documents are
properly completed, signed and received.

. The Funds reserves the right to reject any purchase order.

. At any time, the Funds may change any of their purchase or redemption
procedures, and may suspend the sale of their shares.

. The Funds may delay sending redemption proceeds for up to seven days,
or longer if permitted by the Securities and Exchange Commission.

. We will typically send redemption amounts to you within seven business
days after you redeem shares. We may hold redemption amounts from the
sale of shares you purchased by check until the purchase check has
cleared, which may be as long as 15 days.

. To limit the Funds' expenses, we do not currently issue share
certificates.

. A Fund may temporarily stop redeeming shares if:

. the New York Stock Exchange is closed;

. trading on the New York Stock Exchange is restricted;

. an emergency exists and the Fund cannot sell its assets or accurately
determine the value of its assets; or

. if the Securities and Exchange Commission orders the Fund to suspend
redemptions.

. If accepted by a Fund, investors may purchase shares of the Fund (other
than the Real Estate Equity Investment Fund) with securities which the
Fund may hold. The advisor will determine if the securities are
consistent with the Fund's objectives and policies. If accepted, the
securities will be valued the same way the Fund values portfolio
securities it already owns. Call the Funds at (800) 438-5789 for more
information.

. The Funds reserve the right to make payment for redeemed shares wholly
or in part by giving the redeeming shareholder portfolio securities.
The shareholder may pay transaction costs to dispose of these
securities.

. We record all telephone calls for your protection and take measures to
identify the caller. As long as the Funds' transfer agent takes
reasonable measures to authenticate telephone requests on an investor's
account, neither the Funds, the Funds' distributor nor the transfer
agent will be held responsible

35
<PAGE>

for any losses resulting from unauthorized transactions.

. We may redeem your account if its value falls below $250 as a result of
redemptions (but not as a result of a decline in NAV). You will be
notified in writing and allowed 60 days to increase the value of your
account to the minimum investment level.

. If you purchased shares directly from the Funds, the transfer agent
will send you confirmations of the opening of an account and of all
subsequent purchases, exchanges or redemptions in the account. If your
account has been set up by a broker or other investment professional,
account activity will be detailed in their statements to you.

. [The exchange privilege is not intended as a vehicle for short-term
trading. Excessive exchange activity may interfere with portfolio
management and have an adverse effect on all shareholders. Each Fund
and its distributor reserve the right to refuse any purchase or
exchange request that could adversely affect the fund or its
operations, including those from any individual or group who, in the
Fund's view, is likely to engage in excessive trading or any order
considered market-timing activity. If a Fund refuses a purchase or
exchange request and the shareholder deems it necessary to redeem their
account, any CDSC as permitted by the prospectus will be applicable.

Additionally, in no event will any Fund permit more than six exchanges
into or out of a Fund in any one-year period per account, tax
identification number, social security number or related investment
group. The Munder Money Market Funds are exempt from this policy.]

Shareholder Privileges

Automatic Investment Plan (AIP). Under the AIP you may arrange for periodic
investments in a Fund through automatic deductions from a checking or savings
account. To enroll in the AIP you should complete the AIP application form or
call the Funds at (800) 438-5789. The minimum pre-authorized investment amount
is $50. You may discontinue the AIP at any time. We may discontinue the AIP on
30 days' written notice to you.

Reinvestment Privilege. For 60 days after you sell shares of a Fund, you may
reinvest your redemption proceeds in shares of the same class of a Fund at NAV.
Any CDSC you paid on the amount you are reinvesting will be credited to your
account. You may use this privilege once in any given twelve-month period with
respect to your shares of a Fund. You or your broker must notify the Funds'
transfer agent in writing at the time of reinvestment in order to eliminate the
sales charge on your reinvestment.

Automatic Withdrawal Plan (AWP). If you have an account value of $2,500 or more
in a Fund, you may redeem shares on a monthly, quarterly, semi-annual or annual
basis. The minimum withdrawal is $50. We usually process withdrawals on the 20th
day of the month and promptly send you your redemption amount. You may enroll in
the AWP by completing the AWP application form available through the Funds'
transfer agent. To participate in the AWP you must have your dividends
automatically reinvested and may not hold share certificates. You may change or
cancel the AWP at any time upon notice to the Funds' transfer agent. You should
not buy Class A shares (and pay a sales charge) while you participate in the AWP
and you must pay any applicable CDSC when you redeem shares.

36
<PAGE>

Distribution Arrangements
- ------------------------------------------------------------------------------

Share Class Selection

Each Fund offers Class A, Class B and Class C shares. Each class has its own
cost structure, allowing you to choose the one that best meets your requirements
given the amount of your purchase and the intended length of your investment.
You should consider both ongoing annual expenses and initial sales charge or
CDSC in estimating the costs of investing in a particular class of shares.

Class A shares
. Front end sales charge. There are several ways to reduce these sale charges.

. Lower annual expenses than Class B and Class C shares.

Class B shares
. No front end sales charge. All your money goes to work for you right
away.

. Higher annual expenses than Class A shares.

. A CDSC on shares you sell within six years of purchase.

. Automatic conversion to Class A shares approximately six years after
issuance, thus reducing future annual expenses. o CDSC is waived for certain
redemptions.

Class C shares
. No front end sales charge or CDSC, except for a CDSC for redemptions made
within the first year after investing. All your money goes to work for you
right away.

. Shares do not convert to another class.

. Higher annual expenses than Class A shares.

Each Fund also issues other classes of shares, which have different sales
charges, expense levels and performance. The other classes of shares are
available to limited types of investors. Call (800) 438-5789 to obtain more
information about those classes.

Applicable Sales Charge-class A Shares

You can purchase Class A shares at NAV plus an initial sales charge. This sales
charge as a percentage of your investment decreases as your investment
increases. The current sales charge rates and commissions paid to selected
dealers as follows:

Sales Charge Dealer
as a Percentage of Reallowance
------------------
as a
Percentage
Your Net of the
---- --- ------
Investment Asset Offering
---------- ----- --------
Value 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)**

- --------------------------
</TABLE>

* No initial sales charge applies on investments of $1 million or more.
However, a CDSC of 1% is imposed on certain redemptions within one year of
purchase.
** The distributor will pay a 1% commission to dealers who initiate and are
responsible for purchases of $1 million or more.

Sales Charge Waivers - General
We will waive the initial sales charge on Class A shares for the following types
of purchasers:

1. individuals with an investment account or relationship with the advisor;

2. full-time employees and retired employees of the advisor, employees of the
Funds' service providers and immediate family members of such persons;

3. registered broker-dealers that have entered into selling agreements with 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 below;

5. individuals who reinvest a distribution from a qualified retirement plan for
which the advisor serves as investment advisor;

37
<PAGE>

6. individuals who reinvest the proceeds of redemptions from Class Y Shares of
another Munder Fund, within 60 days of redemption;

7. banks and other financial institutions that have entered into agreements
with the Munder Funds to provide shareholder services for 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 the criteria described below
under "Sales Charge Waivers- Qualified Employer Sponsored Retirement Plans."

Sales Charge Waivers - Qualified Employer Sponsored Retirement Plans
We will waive the initial sales charge on purchases of Class A shares by
employer sponsored retirement plans that are qualified under Section 401(a) or
Section 403(b) of the Internal Revenue Code (each, a Qualified Employee Benefit
Plan) and that (1) invest $1,000,000 or more in Class A shares offered by the
Munder Funds or (2) have at least 75 eligible plan participants.

In addition, we will waive the CDSC of 1% charged on certain redemptions within
one year of purchase for Qualified Employee Benefit Plan purchases that meet the
above criteria. A 1% commission will be paid by the distributor to dealers and
other entities (as permitted by applicable Federal and state law) who initiate
and are responsible for Qualified Employee Benefit Plan purchases that meet the
above criteria. This sales charge waiver does not apply to Simplified Employee
Pension Plans (SEPs), Individual Retirement Accounts (IRAs), UPI Plans and
Merrill Lynch Plans.

UPI Plans. We also will waive (i) the initial sales charge on Class A shares
purchased by UPI Plans for employees participating in an employer-sponsored or
administered retirement program operating under Section 408A of the Internal
Revenue Code and (ii) the CDSC of 1% imposed on certain redemptions within one
year of purchase for these accounts. The distributor will pay a 1% commission to
dealers and others (as permitted by applicable Federal and state law) who
initiate and are responsible for UPI Plan purchases.

Merrill Lynch Plans. We will waive the initial sales charge for all investments
by Merrill Lynch Plans if

(i) the Plan is recordkept on a daily valuation basis by Merrill Lynch Group
Employee Services (Merrill Lynch) and, on the date the plan sponsor signs
the Merrill Lynch Recordkeeping Service Agreement, the Plan has $3 million
or more in assets invested in broker/dealer funds not advised or managed
by Merrill Lynch Asset Management, L.P. (MLAM) that are made available
pursuant to a Services Agreement between Merrill Lynch and the Fund's
distributor and in funds advised or managed by MLAM (collectively, the
Applicable Investments); or

(ii) the Plan is recordkept on a daily valuation basis by an independent
recordkeeper whose services are provided through a contract or alliance
arrangement with Merrill Lynch, and on the date the plan sponsor signs the
Merrill Lynch Recordkeeping Service Agreement, the Plan has $3 million or
more in assets, excluding money market funds, invested in Applicable
Investments; or

(iii) the Plan has 500 or more eligible employees, as determined by the Merrill
Lynch plan conversion manager, on the date the plan sponsor signs the
Merrill Lynch Recordkeeping Service Agreement.

For further information on sales charge waivers, call (800) 438-5789.

Sales Charge Reductions
You may qualify for reduced sales charges in the following cases:

. Letter of Intent. If you intend to purchase at least [$25,000] of Class A
shares of the Funds, you may wish to complete the Letter of Intent section
of your account application form. By doing so, you agree to invest a
certain amount over a 13-month period. You would pay a sales charge on any
Class A shares you purchase during the 13 months based on the total amount
to be invested under the Letter of Intent. You can apply any investments
you made in any of

38
<PAGE>

the Munder Funds during the preceding 90-day period toward fulfillment of
the Letter of Intent (although there will be no refund of sales charges
you paid during the 90-day period). You should inform the Funds' transfer
agent that you have a Letter of Intent each time you make an investment.

You are not obligated to purchase the amount specified in the Letter of
Intent. If you purchase less than the amount specified, however, you must
pay the difference between the sales charge paid and the sales charge
applicable to the purchases actually made. The Funds' custodian will hold
such amount in escrow. The Funds' custodian will pay the escrowed funds to
your account at the end of the 13 months unless you do not complete your
intended investment.

. Quantity Discounts. You may combine purchases of Class A shares that are
made by you, your spouse, your children under age 21 and your IRA when
calculating the sales charge. You must notify your broker or the Funds'
transfer agent to qualify.

. Right of Accumulation. You may add the value of any shares of non-money
market Munder Funds you already own to the amount of your next Class A
share investment for purposes of calculating the sales charge at the time
of the current purchase. You must notify your broker or the Funds'
transfer agent to qualify.

Certain brokers may not offer these programs or may impose conditions or fees to
use these programs. You should consult with your broker prior to purchasing the
Funds' shares.

For further information on sales charge reductions, call (800) 438-5789.

Cdsc

You pay a CDSC when you redeem:
. Class A shares that were bought as part of an investment of at least $1
million within one year of buying them;

. Class B shares within six years of buying them; or

. Class C shares within one year of buying them.

These time periods include the time you held Class B or Class C shares of
another Munder Fund which you may have exchanged for Class B or Class C shares
of the Fund you are redeeming.

The CDSC schedule for Class B shares purchased after June 27, 1995 is set forth
below. Consult the Statement of Additional Information for the CDSC schedule for
Class B shares purchased on or before June 27, 1995. The CDSC is based on the
original NAV at the time of your investment or the NAV at the time of
redemption, whichever is lower.

Years Since Purchase CDSC
- -------------------- ----
First................................... 5.00%
Second.................................. 4.00%
Third................................... 3.00%
Fourth.................................. 3.00%
Fifth................................... 2.00%
Sixth................................... 1.00%
Seventh and thereafter.................. 0.00%

[At the time of purchase of Class B shares, the Funds' distributor pays sales
commissions of 4.00% of the purchase price to brokers that initiate and are
responsible for purchases of such Class B shares.]

You will not pay a CDSC to the extent that the value of the redeemed shares
represents:
. reinvestment of dividends or capital gains distributions; or

. capital appreciation of shares redeemed.

When you redeem shares, we will assume that you are redeeming first shares
representing reinvestment of dividends and capital gains distributions, then any
appreciation on shares redeemed, and then remaining shares held by you for the
longest period of time. [We will calculate the holding period of Class B shares
of a Fund acquired through an exchange of Class B shares of the Munder Money
Market Fund (which are available only by exchange of Class B shares of a Munder
Fund) from the date that the Class B shares of the initial Munder Fund were
purchased.]

Cdsc Waivers
We will waive the CDSC payable upon redemptions of shares which you purchased
after June 27, 1995 (or acquired through an exchange of shares of another Munder
Fund purchased after June 27, 1995) for:
. redemptions made within one year after the death of a shareholder or
registered joint owner;

. minimum required distributions made from an IRA or other retirement plan
account after you reach age 70 1/2;

. involuntary redemptions made by the Fund;

. redemptions limited to 10% per year of an account's net asset value. For
example, if you

39
<PAGE>

maintain an annual balance of $10,000 you can redeem up to $1,000 annually
free of charge.

We will waive the CDSC payable upon redemptions of shares which you purchased
after December 1, 1998 (or acquired through an exchange of shares of another
Munder Fund purchased after December 1, 1998) for:
. redemptions made from an IRA or other individual retirement plan account
established through Comerica Securities, Inc. after you reach age 59 1/2
and after the eighteen month anniversary of the purchase of Fund shares.

Consult the Statement of Additional Information for Class B CDSC waivers which
apply when you redeem shares purchased on or before June 27, 1995 (or acquired
through an exchange of shares of another Munder Fund purchased on or before June
27, 1995).

We will waive the CDSC for Class B shares for all redemptions by Merrill Lynch
Plans if:

(i) the Plan is recordkept on a daily valuation basis by Merrill Lynch; or
(ii) the Plan is recordkept on a daily valuation basis by an independent
recordkeeper whose services are provided through a contract or alliance
arrangement with Merrill Lynch; or
(iii) the Plan has less than 500 eligible employees, as determined by the
Merrill Lynch plan conversion manager, on the date the plan sponsor signs
the Merrill Lynch Recordkeeping Service Agreement.

12b-1 Fees

The Funds have adopted Rule 12b-1 plans with respect to their Class A, Class B
and Class C shares that allow each Fund to pay distribution and other fees for
the sale of its shares and for services provided to shareholders. Under the
plans, the Funds may pay up to .25% of the daily net assets of Class A, Class B
and Class C shares to pay for certain shareholder services provided by
institutions that have agreements with the Funds' distributor to provide such
services. The Funds may also pay up to .75% of the daily net assets of the Class
B and Class C shares to finance activities relating to the distribution of its
shares.

Because the fees are paid out of each Fund's assets on an on-going basis, over
time these fees will increase the cost of an investment in the Funds and may
cost a shareholder more than paying other types of sales charges.

Other Information

The advisor may, from time to time, make payments to banks, broker-dealers or
other financial institutions for certain services to the Funds and/or its
shareholders, including sub-administration, sub-transfer agency and shareholder
servicing. The advisor may make such payments out of its own resources and there
are no additional costs to the Fund or its shareholders.

Please note that Comerica Bank, an affiliate of the advisor, receives a fee from
the Funds for providing shareholder services to its customers who own shares of
the Funds.

40
<PAGE>

Pricing Of Fund Shares
- ------------------------------------------------------------------------------

Each Fund's NAV is calculated on each day the New York Stock Exchange is open.

The Funds calculate NAV as of the close of business on the New York Stock
Exchange, normally 4:00 p.m. (Eastern time).

If the New York Stock Exchange closes early, the Funds will accelerate their
calculation of NAV and transaction deadlines to that time.

The NAV of each Fund is generally based on the market value of the securities
held in the Fund. If market values are not available, the fair value of
securities is determined in good faith by, or using procedures approved by, the
Boards of Directors/Trustees of the Funds.

Trading in foreign securities may be completed at times that vary from the
closing of the New York Stock Exchange. A Fund values foreign securities at the
latest closing price on the exchange on which they are traded immediately prior
to the closing of the New York Stock Exchange. Certain foreign currency exchange
rates may also be determined at the latest rate prior to the closing of the New
York Stock Exchange. Foreign securities quoted in foreign currencies are
translated into U.S. dollars at current rates. Occasionally, events that affect
these values and exchange rates may occur between the times at which they are
determined and the closing of the New York Stock Exchange. If the advisor
believes that such events materially affect the value of portfolio securities,
these securities may be valued at their fair market value as determined in good
faith by, or using procedures approved by, the Funds' Boards of
Directors/Trustees.

Foreign securities may trade in their primary markets on weekends or other days
when a Fund does not price its shares. Therefore, the value of a Fund's
portfolio may change on days when shareholders will not be able to buy or sell
their shares.

Distributions
- ------------------------------------------------------------------------------

As a shareholder, you are entitled to your share of a Fund's net income and
gains on its investments. The Funds pass substantially all of its earnings along
to its shareholders as distributions. When the Funds earn dividends from stocks
and interest from debt securities and distributes these earnings to
shareholders, it is called a dividend distribution. A Fund realizes capital
gains when it sells securities for a higher price than it paid. When these gains
are distributed to shareholders, it is called a capital gain distribution.

Balanced Fund, Growth & Income Fund And Small Company Growth Fund: pay
dividends, if any, quarterly.

Real Estate Equity Investment Fund: pays dividends, if any, monthly.

Growth Opportunities Fund, Equity Selection Fund, International Equity Fund,
Micro-cap Equity Fund, Multi-season Growth Fund, Small-cap Value Fund, Value
Fund, Framlington Emerging Markets Fund, Framlington Global Financial Services
Fund, Framlington Healthcare Fund, Framlington International Growth Fund: pay
dividends, if any, annually.

All Funds: distribute their net realized capital gains, if any, at least
annually.

It is possible that a Fund may make a distribution in excess of the Fund's
earnings and profits. You will treat such a distribution as a return of capital
which is applied against and reduces your basis in your shares. You will treat
the excess of any such distribution over your basis in your shares as gain from
a sale or exchange of the shares.

Each Fund will pay distributions in additional shares of that Fund. If you wish
to receive distributions in cash, either indicate this request on your account
application form or notify the Funds by calling (800) 438-5789.

41
<PAGE>

Federal Tax Considerations
- -------------------------------------------------------------------------------

Investments in a Fund may have tax consequences that you should consider. This
section briefly describes some of the more common federal tax consequences. A
more detailed discussion about the tax treatment of distributions from the Funds
and about other potential tax liabilities, including backup withholding for
certain taxpayers and about tax aspects of dispositions of shares of the Funds,
is contained in the Statement of Additional Information. You should consult your
tax adviser about your own particular tax situation.

Taxes on Distributions

Distributions that are derived from net long-term capital gains generally will
be taxed as long-term capital gains. Dividend distributions and short-term
capital gains generally will be taxed as ordinary income. The tax you pay on a
given capital gains distribution generally depends on how long the Fund held the
portfolio securities it sold. It does not depend on how long you held your Fund
shares.

Distributions are generally taxable to you in the tax year in which they are
paid, with one exception: distributions declared in October, November or
December, but not paid until January of the following year, are taxed as though
they were paid on December 31 in the year in which they were declared.

Shareholders generally are required to report all Fund distributions on their
federal income tax returns. Each year the Funds will send you information
detailing the amount of ordinary income and capital gains paid to you for the
previous year.

Taxes on Sales or Exchanges

If you sell shares of a Fund or exchange them for shares of another Munder Fund,
you generally will be subject to tax on any taxable gain. Your taxable gain is
computed by subtracting your tax basis in the shares from the redemption
proceeds (in the case of a sale) or the value of the shares received (in the
case of an exchange). Because your tax basis depends on the original purchase
price and on the price at which any dividends may have been reinvested, you
should be sure to keep account statements so that you or your tax preparer will
be able to determine whether a sale will result in a taxable gain.

Other Considerations

If you buy shares of a Fund just before the Fund makes any distribution, you
will pay the full price for the shares and then receive back a portion of the
money you have just invested in the form of a taxable distribution.

If you have not provided complete, correct taxpayer information, by law, the
Funds must withhold a portion of your distributions and redemption proceeds to
pay federal income taxes

42
<PAGE>

Management
- -------------------------------------------------------------------------------

Investment Advisors and Sub-Advisor

Munder Capital Management ("MCM"), 480 Pierce Street, Birmingham, Michigan 48009
is the investment advisor of each Fund other than the International Equity Fund.
World Asset Management, L.L.C. "World", 255 East Brown Street, Birmingham,
Michigan 48009, is the investment advisor of the International Equity Fund.
World is a wholly-owned subsidiary of MCM. As of September 30, 1999, MCM [and
its affiliates] had approximately $__ billion in assets under management, of
which $__ billion were invested in equity securities, $__ billion were invested
in money market or other short-term instruments, $__ billion were invested in
other fixed income securities, and $__ billion in non-discretionary assets. As
of September 30, 1999, World had approximately $__ in assets under management.

The advisors provide overall investment management for their respective Funds.
Except for the Framlington Funds, they also provide all research and credit
analysis and are responsible for all purchases and sales of portfolio
securities.

Framlington Overseas Investment Management Limited ("Framlington"), a subsidiary
of MCM, is the sub-advisor of the Framlington Funds.

Framlington provides research and credit analysis for each of the Framlington
Funds and is responsible for making all purchases and sales of portfolio
securities for each of the Framlington Funds other than the Framlington Global
Financial Services Fund. MCM and Framlington each manage a portion of the assets
of the Framlington Global Financial Services Fund. MCM is responsible for all
purchases and sales of domestic securities held by the Framlington Global
Financial Services Fund. Framlington is responsible for the allocation of the
Fund's assets among countries and for making all purchases and sales of foreign
securities held by the Fund.

During the fiscal year ended June 30, 1999, each Fund paid an advisory fee at an
annual rate based on the average daily net assets of the Fund (after waivers, if
any) as follows:

Balanced Fund 0.65%
Equity Selection Fund 0.75%
Growth & Income Fund 0.75%
Growth Opportunities Fund 0.75%
International Equity Fund 0.75%
Micro-Cap Equity Fund 1.00%
Multi-Season Growth Fund 0.75%
Real Estate Equity Investment Fund 0.74%
Small-Cap Value Fund 0.75%
Small Company Growth Fund 0.75%
Value Fund 0.74%
Framlington Emerging Markets Fund 1.25%
Framlington Global Financial Services
Fund 0.75%
Framlington Healthcare Fund 1.00%
Framlington International Growth Fund 1.00%

During the fiscal year ended June 30, 1999, a portion of the advisory fees for
the Multi-Season Growth Fund were waived. As a result, the payments shown above
for those Funds were less than the contractual advisory fees of 1.00% of the
first $500 million of the Multi-Season Growth Fund's average daily net assets
and .75% of that Fund's average daily net assets over $500 million.

Performance of Framlington Accounts Managed by the Sub-Advisor.

The tables below contain certain performance information provided by the sub-
advisor relating to accounts managed by the sub-advisor which have investment
objectives and policies similar to those of the corresponding Framlington Funds.
In the case of the Healthcare portfolio performance, the data relates to a unit
trust organized under the laws of the United Kingdom managed by the same
personnel of the sub-advisor with similar investment objectives and policies to
the Framlington Healthcare Fund. In the case of Emerging Markets portfolio
performance, the data relates to a Canadian-based institutional emerging markets
portfolio managed by the same personnel of the sub-advisor with similar
investment objectives and policies to the Framlington Emerging Markets Fund.

The trust account performance is provided by Standard & Poor's Micropal, an
independent research organization that is a recognized source of performance
date in the UK unit trust industry. The data is U.S. dollar adjusted on the
basis of exchange rates provided by Datastream using WM/Reuters

43
<PAGE>

closing rates. The performance figures are net of brokerage commissions, actual
investment advisory fees and initial sales charges. The data assume the
reinvestment of net income and capital gain distributions. The trust account
returns are calculated using beginning offer and ending bid prices for periods
ended December 31, 1996.

You should not rely on the following performance data of the sub-advisor's
client accounts as an indication of future performance of the Framlington Funds.
It should be noted that the management of the Funds will be affected by Revenue
Code to qualify as a regulated investment company.

Period Ended UK Health S&P Healthcare
Dec. 31,1996 Portfolio Index
- ------------ ---------
Capital Change
--------------
1 Year.............. 10.75% 18.48%
3 Years............. 96.93% 100.49%
5 Years............. 99.43% 45.60%
Inception on
April 30, 1987...... 411.08% 239.64%

Performance for the Health trust account is calculated on an offer-bid basis; US
dollar adjusted total return net of all management fees but not reflective of
U.K. tax. Source: Standard & Poor's Micropal.

S&P Healthcare Composite Index performance shows capital change in U.S. dollars
but does not reflect the deduction of fees, expenses, and taxes. Source:
Datastream.

Canadian
Emerging MSCI Emerging
Period Ended Markets Markets Free
Dec. 31, 1996 Account Total Return
- ------------- ------- ------------

1 Year............. 5.16% 6.03%
Inception on
Nov. 1, 1994....... (3.68)% 12.37)%

MSCI Emerging Markets Free Index performance shows total return in U.S. dollars
but does not reflect the deduction of fees, expenses and taxes. Source:
Datastream.

The performance of the Canadian institutional account is measured by the World
Markets Company on a total return basis and has been re-calculated net of the
management fee charged the Canadian institutional account. The inception date of
the Canadian institutional account is November 1, 1994.

Indices

The S&P Healthcare Composite Index is the composite Healthcare section of the
S&P 500 Index as defined and tracked by S&P. This index covers securities listed
in the United States only.

The MSCI Emerging Markets Free Index is maintained by Morgan Stanley Capital
International and covers 26 countries and represents the investment
opportunities in emerging markets available to foreign investors. Total return
is calculated using the prices of the companies tracked and assumes the
reinvestment of dividends.

Portfolio Managers

Balanced Fund, Equity Selection Fund, Growth Opportunities Fund, Micro-Cap
Equity Fund and Small Company Growth Fund

A committee of professional portfolio managers employed by MCM makes investment
decisions for the Funds.

Growth & Income Fund

Otto Hinzmann, Jr. has been the Fund's portfolio manager since February 1995.
Mr. Hinzmann has been a Vice President and Director of Equity Management of MCM
or of Old MCM, Inc. ("Old MCM"), the predecessor to MCM, since January 1987.

International EquitY Fund

Todd B. Johnson and Theodore Miller jointly manage the Fund. Mr. Johnson,
President and Chief Investment Officer of World, and Mr.
Miller, senior portfolio manager of the Fund, have managed the Fund since July
1992 and October 1996, respectively. Mr. Miller previously worked as the primary
analyst for the Fund (1996) and for Interacciones Global Inc. (1993-1995).

Multi-Season Growth Fund

Leonard J. Barr II has been the Fund's portfolio manager since the Fund's
inception in April 1993. Mr. Barr is the Senior Vice
President and Director of Research of MCM.

ReaL Estate Equity Investment Fund

Peter K. Hoglund and Robert E. Crosby jointly manage the Fund. Mr. Hoglund, who
has managed the Fund since October 1996, was formerly the primary analyst of the
Fund (October 1994 to October 1996). Mr. Crosby, who has managed the Fund since
March 1998, was formerly the primary analyst of the Fund (October 1996 to March
1998).

44
<PAGE>

Mr. Crosby has been employed by MCM since 1993, and also serves as portfolio
manager for separately managed institutional accounts.

Small-Cap Value Fund And Value Fund

Gerald Seizert, Edward Eberle and Brian Wall jointly manage the Funds. Mr.
Seizert, Chief Investment Officer - Equities of the advisor, has managed the
Funds since they commenced operations. Prior to joining MCM in 1995, Mr. Seizert
was a Director and Managing Partner of Loomis, Sayles & Company, L.P. (1984-
1995). Mr. Eberle, who has managed the Small-Cap Value Fund since March 1997 and
the Value Fund since October 1996, was formerly the primary analyst for the
Funds. Prior to joining MCM in 1995, he was an Executive Vice President and
Portfolio Manager for Westpointe Financial Corporation. Mr. Wall, who has
managed the Funds since [March 1997], was formerly a primary analyst for the
Funds. Prior to joining MCM in 1995, he was a Senior Equity Analyst with
Woodbridge Capital Management, Inc. (1994-1995).

Framlington Emerging Markets Fund

A committee of professional portfolio managers employed by Framlington makes
investment decisions for the Fund. William Calvert heads the committee. Mr.
Calvert has been employed by Framlington since 1997. Prior to that he was
employed by Edmond de Rothchild Securities.

Framlington Global Financial Services Fund

A committee of professional managers employed by the MCM or Framlington makes
decisions for the Fund.

Framlington Healthcare Fund

Antony Milford, head of the Specialist Desk for Framlington, has been the Fund's
primary portfolio manager since the Fund's inception. Mr. Milford has managed
funds for Framlington since 1971.

Framlington International Growth Fund

A committee of professional portfolio managers employed by Framlington makes
investment decisions for the Fund. Simon Key, Chief Investment Officer of
Framlington, heads the committee. Mr. Key has managed the Fund for Framlington
since 1989.

45
<PAGE>

Financial Highlights
- -------------------------------------------------------------------------------

The financial highlights table is intended to help shareholders understand each
Fund's financial performance for the past 5 years (or, if shorter, the period of
the Fund's operations). Certain information reflects financial results for a
single Fund share. The total returns in the table represent the rate that an
investor would have earned (or lost) on an investment in a particular class of
the Fund (assuming reinvestment of all dividends and distributions). Because
Class A, Class B and Class C Shares of Equity Selection Fund, Growth
Opportunities Fund and Framlington Global Financial Services Fund had not
commenced operations on June 30, 1999, financial highlights are not presented
for those Funds. The information has been audited by Ernst & Young LLP,
independent accountants, whose report, along with each Fund's financial
statements, are included in the annual reports of the Funds, and are
incorporated by reference into the Statement of Additional Information. You may
obtain the annual reports without charge by calling (800) 438-5789.

<TABLE>
<CAPTION>
Balanced Fund(a)
-----------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e)
Class A Class A Class A Class A Class A Class A
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period........... ------- ------- ------- ------- -------- ---------
Income from investment operations:
Net investment income................
Net realized and unrealized gain/(loss) on
investments....................................
Total from investment operations...............
Less distributions:
Dividends from net investment income...........
Distributions from net realized gains..........
Total distributions............................
Net asset value, end of period.................
Total return(b)................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...........
Ratio of operating expenses to average net
assets.........................................
Ratio of net investment income to average net
assets.........................................
Portfolio turnover rate........................
Ratio of operating expenses to average net assets
without waivers................................
</TABLE>

_______________
46
<PAGE>

<TABLE>
<CAPTION>
Balanced Fund(a)
- ----------------------------------------------------------------------------------------------------------------------
Year Year Year Year Period Period Year Year Year Period
Ended Ended Ended Ended Ended ) Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e) 6/30/99 6/30/98 6/30/97(f) 6/30/96(f)
Class B Class B Class B Class B Class B Class B Class C Class C Class C Class C
------- ------- ------- ------- ------- ------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

47
<PAGE>

<TABLE>
<CAPTION>
Growth & Income Fund(a)
--------------------------------------------------------------------------------
Year Year Year Year Period Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(g) 6/30/96(g) 6/30/95(d) 2/28/95(g)
Class A Class A Class A Class A Class A Class A
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............
Income from investment operations:
Net investment income............................
Net realized and unrealized gain on investments..
Total from investment operations.................
Less distributions:
Dividends from net investment income.............
Distributions from net realized gains............
Total distributions..............................
Net asset value, end of period...................
Total return (b).................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).............
Ratio of operating expenses to average
net assets.......................................
Ratio of net investment income to
average net assets...............................
Portfolio turnover rate..........................
Ratio of operating expenses to average
net assets without waivers.......................
</TABLE>

________________

48
<PAGE>

<TABLE>
<CAPTION>
Growth & Income Fund (a)
- -----------------------------------------------------------------------------------------------------------------------------------
Year Year Year Year Period Period Year Year Year Year
Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(g) 6/30/96(g) 6/30/95(d) 2/28/95(e) 6/30/99 6/30/98 6/30/97(g) 6/30/96(g)
Class B Class B Class B Class B Class B Class B Class C Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

49
<PAGE>

<TABLE>
<CAPTION>
International Equity Fund(a)
------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e,f)
Class A Class A Class A Class A Class A Class A
------- ------- ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.....
Income from investment operations:
Net investment income....................
Net realized and unrealized gain on
investments..............................
Total from investment operations.........
Less distributions:
Dividends from net investment income.....
Distributions from net realized gains....
Distributions from capital...............
Total distributions......................
Net asset value, end of period...........
Total return (b).........................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000's).....
Ratio of operating expenses to average
net assets...............................
Ratio of net investment income to average
net assets...............................
Portfolio turnover rate..................
Ratio of operating expenses to average
net assets without waivers...............
</TABLE>

____________________

50
<PAGE>

<TABLE>
<CAPTION>
International Equity Fund (a)
- ---------------------------------------------------------------------------------------------------------------------------
Year Year Year Year Period Period Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e,f) 6/30/99 6/30/98 6/30/97(f) 6/30/96(f)
Class B Class B Class B Class B Class B Class B Class C Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

51
<PAGE>

<TABLE>
<CAPTION>
Micro-Cap Equity Fund (a)
------------------------------------------------------------------------------
Year Year Year Period Year Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/99 6/30/97(f) 6/30/98 6/30/97(f)
Class A Class A Class B Class A Class B Class B
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...............
Income from investment operations:
Net investment income/(loss).......................
Net realized and unrealized gain/(loss)
on investments.....................................
Total from investment operations...................
Less distributions:
Dividends from net investment income...............
Distributions from net realized gains..............
Total distributions................................
Net asset value, end of period.....................
Total return (b)...................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...............
Ratio of operating expenses to average net
assets.............................................
Ratio of net investment income/(loss)
to average net assets..............................
Portfolio turnover rate............................
Ratio of operating expenses to average net assets
without waivers and/or expenses reimbursed.........
</TABLE>

_________________

52
<PAGE>

<TABLE>
<CAPTION>
Micro-Cap Equity Fund (a) Multi-Season Growth Fund(a)
- --------------------------------------------------------------------------------------------------------
Year Year Period Year Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f) 6/30/95(d,e,h)
Class C Class C Class C Class A Class A Class A Class A Class A
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

53
<PAGE>

<TABLE>
<CAPTION>
Multi-Season Growth Fund(a)
-----------------------------------------------------------------
Year Year Year Year Period
Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f) 6/30/95(d,e,h)
Class B Class B Class B Class B Class B
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period.....
Income from investment operations:
Net investment income/(loss).............
Net realized and unrealized gain/(loss)
on investments...........................
Total from investment operations.........
Less distributions:
Dividends from net investment income.....
Distributions from net realized gains....
Total distributions......................
Net asset value, end of period...........
Total return (b).........................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000's).....
Ratio of operating expenses to average
net assets...............................
Ratio of net investment income to average
net assets...............................
Portfolio turnover rate..................
Ratio of operating expenses to average
net assets without waivers...............
</TABLE>

___________

54
<PAGE>

<TABLE>
<CAPTION>
Multi-Season Growth (a)
- -----------------------------------------------------------------------------------------------
Year Year Year Year Period
Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f) 6/30/95(d,e,h)
Class C Class C Class C Class C Class C
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
</TABLE>

55
<PAGE>

<TABLE>
<CAPTION>
Real Estate Equity Investment Fund(a)
- ------------------------------------------------------------------------------------------------------
Year Year Year Year Period Year Year Year
Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97 6/30/96(e) 6/30/95(d) 6/30/99 6/30/98(e) 6/30/97
Class A Class A Class A Class A Class A Class B Class B Class B
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

56
<PAGE>

<TABLE>
<CAPTION>
Real Estate Equity Investment Fund (a)
--------------------------------------------------------------------------
Year Period Year Year Year Period
Ended Ended Ended Ended Ended Ended
6/30/96(e) 6/30/95(d) 6/30/99 6/30/98(e) 6/30/97 6/30/96(e)
Class B Class B Class C Class C Class C Class C
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......
Income from investment operations:
Net investment income/(loss)..............
Net realized and unrealized gain on
investments...............................
Total from investment operations..........
Less distributions:
Dividends from net investment income......
Distributions in excess of net investment
income....................................
Distributions from net realized gains.....
Distributions from paid-in capital........
Total distributions.......................
Net asset value, end of period............
Total return (b)..........................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000's)......
Ratio of operating expenses to average
net assets................................
Ratio of net investment income/(loss) to
average net assets........................
Portfolio turnover rate...................
Ratio of operating expenses to average net
assets without waivers....................
</TABLE>

______________

57
<PAGE>

<TABLE>
<CAPTION>
Small-Cap Value Fund (a)
- -----------------------------------------------------------------------------------------------------------------------------
Year Year Period Year Year Period Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97(e) 6/30/99 6/30/98(e) 6/30/97(e) 6/30/99 6/30/98(e) 6/30/96(e)
Class A Class A Class A Class B Class B Class B Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

58
<PAGE>

<TABLE>
<CAPTION>
Small Company Growth Fund (a)
-------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f) 6/30/95(e) 2/28/95(d)
Class A Class A Class A Class A Class A Class A
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......
Income from investment operations:
Net investment income......................
Net realized and unrealized gain/(loss)
on investments.............................
Total from investment operations...........
Less distributions: Distributions from net
realized capital gains.....................
Total distributions........................
Net asset value, end of period.............
Total return (b)...........................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000's).......
Ratio of operating expenses to average net
assets.....................................
Ratio of net investment loss to
average net assets.........................
Portfolio turnover rate....................
Ratio of operating expenses to average net
assets without waivers.....................
</TABLE>

______________

59
<PAGE>

<TABLE>
<CAPTION>
Small Company Growth Fund (a)
- -----------------------------------------------------------------------------------------------------------------------------
Year Year Year Year Period Period Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f) 6/30/95(e) 2/28/95(d) 6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f)
Class B Class B Class B Class B Class B Class B Class C Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

60
<PAGE>

<TABLE>
<CAPTION>
Value Fund (a)
----------------------------------------------------------------------------------------------
Year Year Year Period Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/96(d) 6/30/99 6/30/98(d) 6/30/97(d) 6/30/96(d)
Class A Class A Class A Class A Class B Class B Class B Class B
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..
Income from investment operations:
Net investment income/(loss)..........
Net realized and unrealized gain on
investments...........................
Total from investment operations......
Less distributions: Dividends from net
investment income..
Distributions from net realized gains.
Total distributions...................
Net asset value, end of period........
Total return (b)......................
Ratios to average net
assets/supplemental data:
Net assets, end of period (in 000's)..
Ratio of operating expenses to average
net assets............................
Ratio of net investment income/(loss)
to average net assets.................
Portfolio turnover rate...............
Ratio of operating expenses to average
net assets without waivers............
</TABLE>

61
<PAGE>

<TABLE>
<CAPTION>
Value Fund (a)
------------------------------------------------
Year Year Year Year
Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/96(d)
Class C Class C Class C Class C
------- ------- ------- -------
<S> <C> <C> <C> <C>
</TABLE>

62
<PAGE>

<TABLE>
<CAPTION>
Framlington Emerging Markets Fund (a)
--------------------------------------------------------------------------------
Year Year Period Year Year Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/99 6/30/98(d) 6/30/97(d)
Class A Class A Class A Class B Class B Class B
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period....
Income from investment operations:
Net investment income...................
Net realized and unrealized gain/(loss)
on investments..........................
Total from investment operations........
Less distributions:
Dividends from net investment income..
Distributions from net realized gains...
Distributions in excess of net realized
gains...................................
Total distributions.....................
Net asset value, end of period..........
Total return (b)........................
Ratios to average net
assets/supplemental data:
Net assets, end of period (in 000's)....
Ratio of operating expenses to average
net assets..............................
Ratio of net investment income/(loss)
to average net assets...................
Portfolio turnover rate.................
Ratio of operating expenses to average
net assets without expenses reimbursed..
</TABLE>

_________________________

63
<PAGE>

<TABLE>
<CAPTION>
Framlington Emerging Markets Fund (a)
--------------------------------------
Year Year Period
Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d)
Class C Class C Class C
------- ------- -------
<S> <C> <C> <C>
</TABLE>

64
<PAGE>

<TABLE>
<CAPTION>
Framlington Healthcare Fund (a)
-----------------------------------------------------------------------------------------------------------------
Year Year Period Year Year Period Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97 6/30/99 6/30/98(d) 6/30/97 6/30/99 6/30/98(d) 6/30/97
Class A Class A Class A Class B Class B Class B Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

65
<PAGE>

<TABLE>
<CAPTION>
Framlington International Growth Fund (a)
-------------------------------------------------------------------------------
Year Year Period Year Year Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/99 6/30/98(d) 6/30/97(d)
Class A Class A Class A Class B Class B Class B
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period....
Income from investment operations:
Net investment income/(loss)............
Net realized and unrealized gain on
investments.............................
Total from investment operations........
Less distributions: Dividends from net
investment income.......................
Distributions from net realized gains...
Distributions in excess of net
realized gains..........................
Total distributions.....................
Net asset value, end of period..........
Total return (b)........................
Ratios to average net
assets/supplemental data:
Net assets, end of period (in 000's)....
Ratio of operating expenses to average
net assets..............................
Ratio of net investment income/(loss)
to average net assets...................
Portfolio turnover rate.................
Ratio of operating expenses to average
net assets without expenses reimbursed..
</TABLE>

_____________

66
<PAGE>

<TABLE>
<CAPTION>
Framlington International Growth Fund (a)
- -------------------------------------------------
Year Period Period
Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d)
Class C Class C Class C
------- ------- -------
<S> <C> <C> <C>
</TABLE>

67
<PAGE>

For More Information

<TABLE>
<CAPTION>
To Obtain Information:
----------------------------------------------------------
<S> <C>
More information about the Funds is available
free upon request, including the following: By telephone
Call 1-800-438-5789
Annual/Semi-Annual Reports
By mail
You will receive unaudited semi-annual reports The Munder Funds
and audited annual reports on a regular basis 480 Pierce Street
from the Funds. In addition, you will also Birmingham, MI 48009
receive updated Prospectuses or Supplements
to this rospectus. In order to eliminate On the Internet
duplicate mailings, the Funds will only send one Text-only versions of fund documents can be
copy of the above communications to (1) accounts viewed online or downloaded from:
with the same primary record owner, (2) joint
tenant accounts, (3) tenant in common accounts Securities and Exchange Commission
and (4) accounts which have the same address. http://www.sec.gov

Statement Of Additional Information You can also obtain copies by visiting the
Securities and Exchange Commission's Public
Provides more details about the Funds and their Reference Room in Washington, D.C. (phone
policies. A current Securities and Exchange 1-800-SEC-0330) or by sending your request
Commission Statement of Additional Information and a duplicating fee to the Securities and
is on file with the and is incorporated by Exchange Commission's Public Reference Section,
reference (is legally considered part of this Washington, D.C. 20549-6009.
prospectus).
You may also find more information about the
Funds on the Internet at:
http://www.munderfunds.com
----------------------------------------------------------
</TABLE>

The Munder Funds, Inc.
SEC file number: 811-7346

The Munder Framlington Funds Trust
SEC file number: 811-7897

The Munder Funds Trust
SEC file number: 811-5899
<PAGE>

Class K Shares

[Munder Logo]
PROSPECTUS

October 26, 1999

THE MUNDER EQUITY FUNDS
Balanced
Equity Selection
Growth & Income
Growth Opportunities
Index 500
International Equity
Micro-Cap Equity
Multi-Season Growth
Real Estate Equity Investment
Small-Cap Value
Small Company Growth
Value

THE MUNDER FRAMLINGTON FUNDS
Framlington Emerging Markets
Framlington Global Financial Services
Framlington Healthcare
Framlington International Growth

THE MUNDER INCOME FUNDS
Bond
Intermediate Bond
International Bond
U.S. Government Income
Michigan Tax-Free Bond
Tax-Free Bond
Tax-Free Short-Intermediate Bond

THE MUNDER MONEY MARKET FUNDS
Cash Investment
Tax-Free Money Market
U.S. Treasury Money Market

As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities nor passed upon the accuracy or
adequacy of this prospectus. It is a criminal offense to state otherwise.
<PAGE>

Table Of Contents

Risk/Return Summary
. Equity Funds
. Income Funds
. Tax-Free Funds
. Money Market Funds
Summary of Principal Risks
Who May Want To Invest
Fees And Expenses

More About The Funds
Glossary
Special Risks And Other Considerations
Additional Description of Investments And Investment Strategies

Your Investment
How To Reach The Funds
Purchasing Shares
Redeeming Shares
Additional Policies For Purchases And Redemptions
Shareholder Privileges
Service Agents

Pricing of Fund Shares

Distributions

Federal Tax Considerations
Taxes On Distributions
Taxes On Sales
Other Considerations

Management
Investment Advisors and Sub-advisor
Portfolio Managers

Financial Highlights

Back Cover For Additional Information
<PAGE>

Risk/Return Summary
- --------------------------------------------------------------------------------

. how the Fund's average annual returns for 1, 5, and 10 years (or over the
life of the Fund if the Fund is less than 10 years old) compare to those of
a broad based securities market index; and;

. changes in the Fund's performance from year to year over 10 years (or over
the life of the Fund if the Fund is less than 10 years old).

When you consider this information, please remember that a Fund's performance in
past years is not necessarily an indication of how the Fund will perform in the
future.

An investment in the Funds is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency.

Certain terms used in this prospectus are defined in the Glossary.

2
<PAGE>

Equity Funds

Balanced Fund

Goal

The Fund's goal is to provide an attractive investment return through a
combination of growth of capital and current income.

Principal Investment Strategies

The Fund pursues its goal by allocating its assets among three asset groups:
equity securities, fixed income securities and cash equivalents.

The advisor will allocate the Fund's assets to the three asset groups based on
its view of the following factors, among others:

. general market and economic conditions and trends;
. interest rates and inflation rates;
. fiscal and monetary developments; and
. long-term corporate earnings growth.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk, interest
rate risk and credit risk. To the extent that the Fund purchases foreign
securities, it may be subject to foreign securities risk. To the extent that
the Fund enters into futures and options on futures contracts, it may be subject
to derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
1 Year 5 Years Inception
(4/16/93)
--------- ---------- -------------
Class K
[Index]

3
<PAGE>

Equity Selection Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities.

The Fund invests in equity securities which the advisor believes are undervalued
compared to stocks of other companies in the same industry.

The Fund generally invests in companies with market capitalizations of at least
$1 billion.

The Fund diversifies its assets by industry in approximately the same weightings
as those of the S&P 500.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

4
<PAGE>

Growth & Income Fund

Goal

The Fund's goal is to provide capital appreciation and current income.

Principal Investment Strategies

The Fund pursues its goal by investing primarily in dividend-paying equity
securities. Under normal circumstances, the Fund will invest at least 65% of its
assets in income-producing common stocks and convertible preferred stocks.

The Fund may also purchase fixed income securities which are convertible into or
exchangeable for common stock.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

Calendar Year Total Return

1995: _____%
1996: _____%
1997: _____%
1998: _____%

_____________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
1 Year Inception
(7/5/94)
------------- ----------------
Class K
[Index]

5
<PAGE>

Growth Opportunities Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in the equity
securities of companies with market capitalizations between $500 million and $10
billion.

Its style, which focuses on both growth prospects and valuation, is known as
GARP (Growth at a Reasonable Price) and seeks to produce attractive returns
during various market environments.

The advisor chooses the Fund's investments by reviewing the earnings growth of
approximately 10,000 companies over the past three years and investing in
approximately 50 to 100 companies based on:

. superior earnings growth;
. financial stability;
. relative market value; and
. price changes compared to the S&Ps MidCap 400 Index.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

6
<PAGE>

Index 500 Fund

Goal

The Fund's goal is to provide performance and income that is comparable to the
S&P 500. The S&P 500 is an index of 500 stocks which emphasizes large
capitalization companies.

Principal Investment Strategies

The Fund pursues its goal by normally holding the securities of at least 400 of
the stocks in the S&P 500.

The Fund is managed through the use of a "quantitative" investment approach and
tries to mirror the composition and performance of the S&P 500 through
statistical procedures. As a result, the advisor does not use traditional
methods of fund investment management, i.e., it does not select stocks on the
basis of economic, financial and market analysis.

The Fund will try to achieve a correlation between the performance of its
portfolio and that of the S&P 500 of at least .95. A correlation of 1.0 would
mean that the changes in the Fund's price mirror exactly the changes in the S&P
500.

The Fund may also enter into futures contracts.

Principal Risks

Among the principal risks of investing in the Fund is market risk. To the
extent that the Fund purchases foreign securities, it may be subject to foreign
securities risk. To the extent that the Fund enters into futures contracts, it
may be subject to derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (12/7/92)
----------- ------------ -----------
Class K
[Index]

7
<PAGE>

International Equity Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing primarily in foreign securities including
American Depositary Receipts.

The Fund emphasizes companies with a market capitalization of at least $250
million.

The Fund may also enter into futures and options on futures contracts, forward
currency exchange contracts and purchase and sell options.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (11/23/92)
------------ ------------ -------------
Class K
[Index]

8
<PAGE>

Micro-Cap Equity Fund

Goal

The Fund's goal is to provide capital appreciation.

Principal Investment Strategies

The Fund attempts to provide investors with potentially higher returns than a
fund that invests primarily in larger, more established companies. Since
smaller capitalization companies are generally not as well known to investors
and have less of an investor following than larger companies, they may provide
higher returns due to inefficiencies in the marketplace.

The advisor will choose companies that:
. present the ability to grow significantly over the next several years;
. may benefit from changes in technology, regulations and industry sector
trends; and
. are still in the developmental stage and may have limited product lines.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
1 Year Inception
(12/3/96)
------------- ---------------
Class K
[Index]

9
<PAGE>

Multi-Season Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation. This goal is
"fundamental" and cannot be changed without shareholder approval.

Principal Investment Strategies

The advisor chooses the Fund's investments by reviewing the earnings growth of
approximately 5,500 companies over the past five years and investing in
approximately 50 to 100 companies based on:

. superior earnings growth;
. financial stability;
. relative market value; and
. price changes compared to the S&P 500.

The Fund may also purchase foreign securities.

Principal Risks

Among the principal risks of investing in the Fund is market risk. To the
extent that the Fund purchases foreign securities, it may be subject to foreign
securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (6/23/95)
------------ -------------
Class K
[Index]

10
<PAGE>

Real Estate Equity Investment Fund

Goal

The Fund's goal is to provide both capital appreciation and current income.
This goal is "fundamental" and cannot be changed without shareholder approval.

Principal Investment Strategies

The companies in which the Fund primarily invests include:
. equity real estate investment trusts ("REITS");
. brokers, home builders and real estate developers;
. companies with substantial real estate holdings (for example, paper and
lumber producers, hotels and entertainment companies);
. manufacturers and distributors of building supplies;
. mortgage REITS; and
. financial institutions which issue or service mortgages.

In addition, the Fund may invest:
. up to 35% of its assets in companies other than real estate industry
companies;
. in fixed income securities including up to 5% of its assets in debt
securities rated below investment grade or unrated if secured by real
estate assets and if the advisor believes that the underlying collateral is
sufficient; and
. in REITS only if they are traded on a securities exchange or NASDAQ.

Principal Risks

Among the principal risks of investing in the Fund are market risk and sector
risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (10/3/96)
-------------- ------------------
Class K
[Index]

11
<PAGE>

Small-Cap Value Fund

Goal

The Fund's goal is to provide long-term capital appreciation, with income as a
secondary objective.

Principal Investment Strategies

The Fund may invest in equity securities of larger capitalization companies.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk and small
company stock risk. To the extent that the Fund purchases foreign securities,
it may be subject to foreign securities risk. To the extent that the Fund
enters into futures and options on futures contracts, it may be subject to
derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (12/31/96)
------------ --------------
Class K
[Index]

12
<PAGE>

Small Company Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund attempts to provide investors with potentially higher returns than a
fund that invests primarily in larger, more established companies. Since
smaller capitalization companies are generally not as well-known to investors
and have less of an investor following than larger companies, they may provide
higher returns due to inefficiencies in the marketplace.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (11/23/92)
------------- ------------- ------------
Class K
[Index]

13
<PAGE>

Value Fund

Goal

The Fund's primary goal is to provide long-term capital appreciation. Its
secondary goal is to provide income.

Principal Investment Strategies

The Fund pursues its goals by investing primarily in the equity securities of
well-established companies with intermediate to large capitalizations, which
typically exceed $750 million.

The Fund will invest at least 65% of its assets in equity securities.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk and medium-
size company stock risk. To the extent that the Fund purchases foreign
securities, it may be subject to foreign securities risk. To the extent that
the Fund enters into futures and options on futures contracts, it may be subject
to derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (11/30/95)
----------- ------------
Class K
[Index]

14
<PAGE>

Framlington Emerging Markets Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund may also invest in foreign securities of companies located in countries
with mature markets.

Principal Risks

Among the principal risks of investing in the Fund are market risk, foreign
securities risk, emerging markets risk, currency risk and medium-size company
stock risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (1/10/97)
----------- ------------
Class K
[Index]

15
<PAGE>

Framlington Global Financial Services Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund may also enter into forward currency exchange contracts.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

16
<PAGE>

Framlington Healthcare Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund will invest in:

. pharmaceutical producers;
. biotechnology firms;
. medical device and instrument manufacturers;
. distributors of healthcare products;
. healthcare providers and managers; and
. other healthcare service companies.

The Fund's investments may include foreign securities of companies located in
countries with mature markets.

Principal Risks

Among the principal risks of investing in the Fund are market risk, sector risk,
foreign securities risk, currency risk and medium-size company stock risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
1 Year Inception
(4/1/97)
---------- -----------
Class K
[Index]

17
<PAGE>

Framlington International Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities of issuers located in at least three foreign countries.

The sub-advisor will choose companies that demonstrate:

. above-average profitability;
. high quality management; and
. the ability to grow significantly in their countries.

The Fund may invest in companies located in countries with mature markets and in
those with emerging markets. The Fund may also enter into forward currency
exchange contracts.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (1/10/97)
------------- -------------
Class K
[Index]

18
<PAGE>

Income Funds

Bond Fund

Goal

The Fund's primary goal is to provide a high level of current income. Its
secondary goal is capital appreciation.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its total assets in a broad range of bonds and other fixed income
securities. These may include:

. U.S. Government securities and repurchase agreements collateralized by such
securities;
. obligations of state, local and foreign governments;
. obligations of domestic and foreign banks;
. obligations of domestic and foreign corporations;
. zero coupon bonds, debentures and convertible debentures;
. mortgage and other asset-backed securities; and
. stripped securities.

The Fund's strategy focuses on areas where the advisor believes value can be
added. These include credit analysis and analysis of such factors as interest
rate relationships, the relative attractiveness of bond market sectors and the
characteristics of individual issuers.

The Fund's dollar-weighted average maturity will generally range between six and
fifteen years.

The Fund will purchase only fixed income securities that are rated investment
grade or better, or if unrated, are of comparable quality.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may be
subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (11/23/92)
------------- ------------ --------------
Class K
[Index]

19
<PAGE>

Intermediate Bond Fund

Goal

The Fund's goal is to provide a competitive rate of return which, over time,
exceeds the rate of inflation and the return provided by money market
instruments.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its total assets in a broad range of bonds and other fixed income
securities. These may include:

The Fund's dollar-weighted average maturity will generally range between three
and eight years.

The Fund will purchase only fixed income securities that are rated investment
grade or better, or if unrated, are of comparable quality.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may be
subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (11/20/92)
----------- ----------- --------------
Class K
[Index]

20
<PAGE>

International Bond Fund

Goal

The Fund's goal is to realize a competitive total return through a combination
of current income and capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing, under normal market conditions, at least
65% of its total assets in a broad range of bonds and other fixed income
securities of foreign issuers. These may include:

. obligations issued by foreign governments, their agencies,
instrumentalities or political subdivisions;
. obligations issued or guaranteed by supranational organizations (such as
the World Bank);
. obligations of foreign banks or bank holding companies; and
. obligations of foreign corporations.

The Fund will invest in the securities of issuers in at least three foreign
countries.

The Fund's strategy focuses on analysis of bond yield relationships and
specifically focuses on making allocation decisions based on yield relationships
between countries, pricing inefficiencies in the marketplace and yield curve
analysis.

The Fund's dollar-weighted average maturity will generally range between three
and fifteen years.

The Fund may invest a portion of its assets in domestic obligations, including
U.S. Government securities and obligations of domestic banks and corporations.

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may enter into forward currency exchange contracts.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk,
credit risk, foreign securities risk, currency risk and non-diversified risk. To
the extent the Fund enters into forward currency contracts, it may be subject to
derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (3/25/97)
--------- --------------
Class K
[Index]

21
<PAGE>

U.S. Government Income Fund

Goal

The Fund's goal is to provide high current income.

Principal Investment Strategies

The Fund pursues its goal by investing, under normal market conditions, at least
65% of its total assets in a broad range of U.S. Government securities and
repurchase agreements relating to such securities.

The Fund's strategy focuses on areas where the advisor believes value can be
added. These include credit analysis and an analysis of such factors as
interest rate relationships, the relative attractiveness of the government-
related sectors of the market and the characteristics of individual issues.

The Fund's dollar-weighted average maturity generally will range between six and
fifteen years.

The Fund may also invest in other fixed income securities.

Principal Risks

The principal risk of investing in the Fund is interest rate risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (7/5/94)
---------- ------------
Class K
[Index]

22
<PAGE>

Tax-Free Funds

Michigan Tax-Free Bond Fund
(Offered only in the State of Michigan.)

Goal

The Fund's goal is to provide as high a level of current interest income exempt
from regular Federal income taxes and Michigan state income tax as is consistent
with prudent investment management and preservation of capital.

Principal Investment Strategies

The Fund pursues its goal by investing, under normal market conditions, at least
80% of the Fund's net assets in municipal obligations issued by the State of
Michigan and its political subdivisions. The interest on these obligations is
exempt from Federal income taxes and Michigan state income tax.

The Fund will invest primarily in Michigan municipal obligations that have
remaining maturities of between three and thirty years. The Fund's dollar-
weighted average maturity will generally range between ten and twenty years.

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk,
credit risk and non-diversified risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

[1994: _____%]
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (1/3/94)
----------- ------------ ------------
Class K
[Index]

23
<PAGE>

Tax-Free Bond Fund

Goal

The Fund's goals are to provide a high level of current interest income exempt
from Federal income taxes and to generate as competitive a long-term rate of
return as is consistent with prudent investment management and preservation of
capital.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its net assets in municipal obligations.

Under normal market conditions, at least 80% of the Fund's net assets will be
invested in municipal obligations whose interest is exempt from regular Federal
income tax. This fundamental policy may only be changed with shareholder
approval.

In selecting securities for the Fund, the advisor places a premium on value and
diversifies the Fund's portfolio holdings across maturities, industries and
geographic locations.

The Fund invests primarily in intermediate-term and long-term municipal
obligations that have remaining maturities of between three and thirty years.
The Fund's dollar-weighted average maturity will generally range between ten and
twenty years.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (7/5/94)
------------- ------------
Class K
[Index]

24
<PAGE>

Tax-Free Short-Intermediate Bond Fund

Goal

The Fund's goals are to provide a competitive level of current interest income
exempt from regular Federal income taxes and a total return which, over time,
exceeds the rate of inflation and the return provided by tax-free money market
instruments.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its net assets in municipal obligations.

Under normal market conditions, at least 80% of the Fund's net assets will be
invested in municipal obligations whose interest is exempt from regular Federal
income tax.

The Fund generally buys obligations with remaining maturities of five years or
less. The Fund's dollar-weighted average maturity will generally range between
two and five years.

The Fund may invest more than 25% of its assets in municipal obligations issued
by the State of Michigan and its political subdivisions.

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk,
credit risk and non-diversified risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1989: _____%
1990: _____%
1991: _____%
1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

1 Year 5 Years 10 Years
-------------- ------------- ---------------
Class K
[Index]

25
<PAGE>

- --------------------------------------------------------------------------------
Money Market Funds
- --------------------------------------------------------------------------------

Cash Investment Fund

Goal

The Fund's primary goal is to provide as high a level of current interest income
as is consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing in a broad range of U.S. dollar-
denominated money market instruments.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

The Fund's investments may include fixed and variable rate securities.

The Fund may also invest in foreign securities.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may be
subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1989: _____%
1990: _____%
1991: _____%
1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%
Average Annual Total Return
(for the periods ended December 31, 1998)

1 Year 5 Years 10 Years
-------------- -------------- ---------------
Class K
[Index]

26
<PAGE>

Tax-Free Money Market Fund

Goal

The Fund's goal is to provide as high a level of current interest income exempt
from Federal income taxes as is consistent with maintaining liquidity and
stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing substantially all of its assets in short-
term, U.S. dollar-denominated municipal obligations, the interest on which is
exempt from regular Federal income tax.

Under normal market conditions, the Fund will invest at least 80% of its net
assets in municipal obligations.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

Principal Risks

Although the Fund seeks to preserve the value of our investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

Among the principal risks of investing in the Fund are interest rate risk and
credit risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

___________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)
Since
1 Year 5 Years Inception
(11/23/92)
------------- ----------- -------------
Class K
[Index]

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

27
<PAGE>

U.S. Treasury Money Market Fund

Goal

The Fund's goal is to provide as high a level of current interest income as is
consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing its assets solely in short-term bonds,
bills and notes, issued by the U.S. Treasury (including "stripped" securities)
and in repurchase agreements relating to such obligations.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

Among the principal risks of investing in the Fund is interest rate risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)
Since
1 Year 5 Years Inception
(11/25/92)
-------- --------- ---------------
Class K
[Index]

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

28
<PAGE>

Summary of Principal Risks of The Funds

The share price of the Funds will change daily based on market conditions and
other factors. Therefore, you may lose money if you invest in the Funds.

DERIVATIVES RISK is the risk that loss may result from a Fund's use of futures
and options on futures contracts, options, forward currency exchange contracts
and other forms of derivative instruments. The primary risk with many
derivatives is that they can amplify a gain or loss, potentially earning or
losing substantially more money than the actual cost of the derivative
instrument. Funds particularly subject to this risk are: Balanced Fund,
International Equity Fund, Index 500 Fund, Value Fund, Small-Cap Value Fund,
Global Financial Services Fund, International Growth Fund and International Bond
Fund.

FOREIGN SECURITIES RISK is the risk of loss because investments by a Fund in
foreign securities may experience greater and more rapid change in value than
investments in U.S. securities. Foreign securities are generally more volatile
and less liquid than U.S. securities, in part because of greater political and
economic risks and because there is less public information available about
foreign companies. Issuers of foreign securities are generally not subject to
the same degree of regulation as are U.S. issuers. The reporting, accounting and
auditing standards of foreign countries may differ, in some cases significantly,
from U.S. standards. Funds particularly subject to this risk are: Balanced Fund,
Equity Selection Fund, Growth & Income Fund, Growth Opportunities Fund,
International Equity Fund, Micro-Cap Equity Fund, Value Fund, Small-Cap Value
Fund, Small Company Growth Fund, Multi-Season Growth Fund, Emerging Markets
Fund, Global Financial Services Fund, Healthcare Fund, International Growth
Fund, Bond Fund, Intermediate Bond Fund, International Bond Fund and Cash
Investment Fund.

29
<PAGE>

Markets Fund and International Growth Fund.

INTEREST RATE RISK is the risk of loss because increases in prevailing interest
rates will cause fixed-income securities held by a Fund to decline in value.
Longer term bonds are generally more sensitive to interest rate changes than
shorter term bonds. Generally, the longer the average maturity of the bonds held
by the Fund, the more the Fund's share price will fluctuate in response to
interest rate changes. Funds particularly subject to this risk are: Balanced
Fund, Growth & Income Fund, Bond Fund, Intermediate Bond Fund, International
Bond Fund, U.S. Government Income Fund, Michigan Tax-Free Bond Fund, Tax-Free
Short-Intermediate Bond Fund, Cash Investment Fund, Tax-Free Money Market Fund
and U.S. Treasury Money Market Fund.

MARKET RISK is the risk of loss because the value of the securities in which a
Fund invests may decline in response to general economic conditions. Price
changes may be temporary or last for extended periods. For example, stock prices
have historically risen and fallen in periodic cycles. In addition, the value of
Fund's investments may decline if the particular companies the Funds invest in
do not preform well. All of the Munder Equity Funds are subject to this risk.

MEDIUM-SIZE COMPANY STOCK RISK is the risk of loss because the stocks of medium-
size companies may be more susceptible to market downturns, and their prices may
be more volatile than the stocks of larger companies. Equity Selection Fund,
Growth Opportunities Fund, Value Fund, Emerging Markets Fund, Global Financial
Services Fund, International Growth Fund and Healthcare Fund are particularly
subject to this risk.

NON-DIVERSIFIED RISK is the risk of loss because a Fund that invests more of its
assets in fewer issuers than many other funds do, may be more susceptible to
adverse developments affecting any single issuer, and more susceptible to
greater losses because of these developments. For example, the Michigan Tax-Free
Bond Fund invests primarily in Michigan municipal obligations, if Michigan
issuers suffer serious financial difficulties, jeopardizing their ability to pay
their obligations, the Fund may suffer a loss. International Bond Fund, Michigan
Tax-Free Bond Fund and Tax-Free Short-Intermediate Bond Fund are subject to this
risk.

PREPAYMENT RISK is the risk that a Fund may experience losses when an issuer
exercises its right to pay principal on an obligation held by the Fund (such as
a mortgage-backed security) earlier than expected. This may happen during a
period of declining interest rates. Under these circumstances, the Fund may be
unable to recoup all of its initial investment and will suffer from having to
reinvest in lower yielding securities. The loss of higher yielding securities
and the reinvestment at lower interest rates can reduce the Fund's income, total
return and share price. Funds particularly subject to this risk are: Balanced
Fund, Bond Fund, Intermediate Bond Fund, U.S. Government Income Fund and Cash
Investment Fund.

30
<PAGE>

Who May Want To Invest

The Equity Funds may be appropriate for investors:

. Looking to invest over the long term and willing to ride out market swings
in search of potentially higher returns.

. Looking for an investment that has more return and risk potential than
fixed income investments.

The Income Funds may be appropriate for investors:

. Looking for potentially higher returns and willing to accept greater risk
than more conservative fixed rate investments or money market funds.

. Looking for current income.

The Tax-Free Funds may be appropriate for investors:

. Looking primarily for tax-exempt income.

. Comfortable with the risks involved with fixed income investments.

The Money Market Funds may be appropriate for investors:

. Looking for a high level of income and liquidity and stability of
principal.

31
<PAGE>

Fees And Expenses

The tables below describe the fees and expenses that you may pay if you buy and
hold Class K shares the Funds. Please note that the following information does
not include fees that institutions may charge for services they provide to you.

Shareholder Fees (fees paid directly from your investment)
Maximum Sales Charge (Load) Imposed on Purchases.......................... None
Sales Charge (Load) Imposed on Reinvested Dividends....................... None
Maximum Deferred Sales Charge (Load)...................................... None
Redemption Fees........................................................... None
Exchange Fees............................................................. None

Annual Fund Operating Expenses (expenses that are paid from Fund assets) And
Examples

Annual Fund Operating Expenses
As a % of net assets Examples
- -------------------------------------------------------- --------------------
Balanced Fund

Management Fees .65% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
----
Total Annual Fund Operating Expenses [ ]% 10 Years $
====

Equity Selection Fund

Management Fees .75% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses .[ ]% 5 Years $
----
Total Annual Fund Operating Expenses [ ] 10 Years $
====

Growth & Income Fund

Management Fees .75% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ] 5 Years $
----
Total Annual Fund Operating Expenses [ ] 10 Years $
====

Growth Opportunities Fund

Management Fees .75% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses (2) [ ] 5 Years $
----
Total Annual Fund Operating Expenses (3) [ ] 10 Years $
====

Index 500 Fund

Management Fees [ ] 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ] 5 Years $
----
Total Annual Fund Operating Expenses [ ] 10 Years $
====

32
<PAGE>

Annual Fund Operating Expenses
as a % of net assets Examples
- ----------------------------------------------------- ------------------------
International Equity Fund

Management Fees .75% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====
Micro-Cap Equity Fund

Management Fees 1.00% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses (2) [ ] 5 Years $
-----
Total Annual Fund Operating Expenses (3) [ ] 10 Years $
=====

Multi Season Growth Fund

Management Fees (1) [ ] 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses (3) [ ] 10 Years $
=====

Real Estate Equity Investment Fund

Management Fees .74% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses .[ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====
Small-Cap Value Fund

Management Fees .75% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====

Small Company Growth Fund

Management Fees .75% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====

Value Fund

Management Fees .74% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====

Framlington Emerging Markets Fund

Management Fees 1.25% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses (2) [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses (3) [ ]% 10 Years $
=====

33
<PAGE>

Annual Fund Operating Expenses
as a % of net assets Examples
- ----------------------------------------------------------- ---------------
Framlington Global Financial Services Fund

Management Fees .75% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses (2) [ ] 5 Years $
-------
Total Annual Operating Expenses (3) [ ] 10 Years $
=======
Framlington Healthcare Fund

Management Fees 1.00% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses (2) [ ] 5 Years $
-------
Total Annual Fund Operating Expenses [ ] 10 Years $
=======

Framlington International Growth Fund

Management Fees 1.00% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses (2) [ ] 5 Years $
-------
Total Annual Fund Operating Expenses (3) [ ] 10 Years $
=======

Bond Fund

Management Fees .50% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-------
Total Annual Fund Operating Expenses [ ]% 10 Years $
=======

Intermediate Bond Fund

Management Fees .50% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-------
Total Annual Fund Operating Expenses .[ ]% 10 Years $
=======

International Bond Fund

Management Fees .50% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses .[ ]% 5 Years $
-------
Total Annual Fund Operating Expenses [ ]% 10 Years $
=======
U.S. Government Income Fund

Management Fees .50% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-------
Total Annual Fund Operating Expenses .[ ]% 10 Years $
=======

Michigan Tax-Free Bond Fund

Management Fees .50% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-------
Total Annual Fund Operating Expenses [ ]% 10 Years $
=======

34
<PAGE>

Annual Fund Operating Expenses
as a % of net assets Examples
- --------------------------------------------------- ----------------------
Tax-Free Bond Fund

Management Fees .50% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses .[ ]% 10 Years $
=====

Tax-Free Short-Intermediate Bond Fund

Management Fees .50% 1 Year $
Shareholder Servicing Fees .25% 3 Years $
-----
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====
Cash Investment Fund

Management Fees .35% 1 Year $
Shareholder Servicing Fees .15% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====
Tax-Free Money Market Fund

Management Fees .35% 1 Year $
Shareholder Servicing Fees .15% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====
U.S. Treasury Money Market Fund

Management Fees .35% 1 Year $
Shareholder Servicing Fees .15% 3 Years $
Other Expenses [ ]% 5 Years $
-----
Total Annual Fund Operating Expenses [ ]% 10 Years $
=====
____________________
(1) For the fiscal year ended June 30, 1999, the advisor voluntarily waived a
portion of its management fees. As a result of the fee waiver, actual
management fees paid by the Multi-Season Growth Fund, based on the Fund's
average daily net assets, were [ ]%.

(2) For the fiscal year ended June 30, 1999, the advisor voluntarily reimbursed
certain operating expenses. As a result of the expense reimbursement,
actual Other Expenses paid by the Funds, were:

Other Operating Expenses
Fund (as a % of average daily net assets)
- ---- ------------------------------------
Growth Opportunities Fund %
Micro-Cap Equity Fund %
Framlington Emerging Markets Fund %
Framlington Global Financial Services Fund %
Framlington Healthcare Fund %
Framlington International Growth Fund %

35
<PAGE>

Total Annual Fund Operating Expenses
Fund (as a % of average daily net assets)
- ---- ------------------------------------
Growth Opportunities Fund %
Multi-Season Growth Fund %
Micro-Cap Equity Fund %
Framlington Emerging Markets Fund %
Framlington Global Financial Services Fund %
Framlington Healthcare Fund %
Framlington International Growth Fund %

36
<PAGE>

More About The Funds
- --------------------------------------------------------------------------------

Glossary

TYPES OF FUNDS

Equity Funds are the Balanced Fund, Equity Selection Fund, Growth & Income Fund,
Growth Opportunities Fund, Index 500 Fund, International Equity Fund, Micro-Cap
Equity Fund, Multi-Season Growth Fund, Real Estate Equity Investment Fund,
Small-Cap Value Fund, Small Company Growth Fund, Value Fund, Framlington
Emerging Markets Fund, Framlington Global Financial Services Fund, Framlington
Health Care Fund and Framlington International Growth Fund.

Income Funds are the Bond Fund, Intermediate Bond Fund, International Bond Fund
and U.S. Government Income Fund.

Tax-Free Funds are the Michigan Tax-Free Bond Fund, Tax-Free Bond Fund and Tax-
Free Short-Intermediate Bond Fund.

Money Market Funds are the Cash Investment Fund, Tax-Free Money Market Fund and
U.S. Treasury Money Market Fund.

TYPES OF SECURITIES

Municipal obligations are obligations of states, territories and possessions of
the United States and the District of Columbia, and their political
subdivisions, agencies, instrumentalities and authorities. They may be payable
from the issuer's general revenue, the revenue of a specific project, current
revenues or a reserve fund.

37
<PAGE>

Rating Agencies and Indices

Moody's is Moody's Investor Services, Inc.

Duff & Phelps is Duff & Phelps Credit Rating Co.

Fitch is Fitch IBCA, Inc.

S&P is Standard & Poor's Rating Services.

S&P 500 is S&P's 500 Composite Stock Price Index, a widely recognized unmanaged
index of U.S. stock market activity.

Other

1940 Act is the Investment Company Act of 1940, as amended.

Internal Revenue Code is the Internal Revenue Code of 1986, as amended.

NAV is the net asset value per share of a Fund. NAV is the value of a single
share of a Fund. NAV for Class K shares is calculated by (1) taking the current
value of a Fund's total assets allocated to that class of shares, (2)
subtracting the liabilities and expenses charged to the class (3) dividing that
amount by the total number of shares of that Class outstanding.

Special Risks And Other Considerations

Investment Strategy. All Funds (except the Short Term Treasury Fund
and the U.S. Treasury Money Market Fund) may use derivative
instruments. Derivatives can be used for hedging (attempting to reduce
risk by offsetting one investment position with another) or
speculation (taking a position in the hope of increasing return). The
Funds may, but are not required to, use derivatives for hedging
purposes or for the purpose of remaining fully invested or maintaining
liquidity. The Funds will not use derivatives for speculative
purposes.

Special Risks. The use of derivative instruments exposes a Fund to
additional risks and transaction costs. Risks of derivative
instruments include: (1) the risk that interest rates, securities
prices and currency markets will not move in the direction that a
portfolio manager anticipates; (2) imperfect correlation between the
price of derivative instruments and movements in the prices of the
securities, interest rates or currencies being hedged; (3) the fact
that skills needed to use these strategies are different than those
needed to select portfolio securities; (4) the possible absence of a
liquid secondary market for any particular instrument and possible
exchange imposed price fluctuation limits, either of which may make it
difficult or impossible to close out a position when desired; (5) the
risk that adverse price movements in an instrument can result in a
loss substantially greater than the Fund's initial investment in that
instrument (in some cases, the potential loss is unlimited); (6)
particularly in the case of privately-negotiated instruments, the risk
that the counterparty will not perform its obligations, which could
leave the Fund worse off than if it had not entered into the position;
and (7) the inability to close out certain hedged positions to avoid
adverse tax consequences.

38
<PAGE>

("GDRs"). ADRs are U.S. dollar-denominated receipts representing shares of
foreign-based corporations. ADRs are issued by U.S. banks or trust companies,
and entitle the holder to all dividends and capital gains that are paid out on
the underlying foreign shares. EDRs and GDRs are receipts issued by non-U.S.
financial institutions that often trade on foreign exchanges. They represent
ownership in an underlying foreign or U.S. security and are generally
denominated in a foreign currency.

Investment Strategy. International Equity Fund, International Growth
Fund, Framlington Global Financial Services Fund, Framlington
Healthcare Fund, Framlington International Growth Fund and
International Bond Fund will invest all or a substantial portion of
their total assets in foreign securities. The other Equity Funds
(except Real Estate Investment Fund), the Income Funds, and Cash
Investment Fund may invest up to 25% of their total assets in foreign
securities. The Tax-Free Funds may invest up to 10% of their total
assets in foreign securities.

Investment in foreign securities may involve higher costs than
investment in U.S. securities, including higher transaction and
custody costs as well as the imposition of additional taxes by foreign
governments. Foreign investments may also involve risks associated
with the level of currency exchange rates, less complete financial
information about the issuers, less market liquidity, more market
volatility and political instability. Future political and economic
developments, the possible imposition of withholding taxes on dividend
income, the possible seizure or nationalization of foreign holdings,
the possible establishment of exchange controls or freezes on the
convertibility of currency, or the adoption of other governmental
restrictions might adversely affect an investment in foreign
securities. Additionally, foreign issuers may be subject to less
stringent regulation, and to different accounting, auditing and
recordkeeping requirements.

Additional risks are involved when investing in countries with
emerging economies or securities markets. In general, the securities
markets of these countries are less liquid, are subject to greater
price volatility, have smaller market capitalizations and may have
problems with securities registration and custody. In addition,
because the securities settlement procedures are less developed in
these countries, a Fund may be required to deliver securities before
receiving payment and may also be unable to complete transactions
during market disruptions. As a result of these and other risks,
investments in these countries generally present a greater risk of
loss to the Fund.

39
<PAGE>

banking businesses, if enacted, could significantly impact the industry and the
Fund. The Fund may be riskier than a fund investing in a broader range of
industries.

Investment Grade Credit Risk. A security is considered investment grade if, at
the time of purchase, it is rated:

. BBB or higher by S&P;
. Baa or higher by Moody's;
. BBB or higher by Duff & Phelps; or
. BBB or higher by Fitch.

A security will be considered investment grade if it receives one of the above
ratings, even if it receives a lower rating from other rating organizations.

Investment Strategy. Except as stated in the next section, fixed
income and convertible securities purchased by the Funds will
generally be rated at least investment grade. The Funds may also
invest in unrated securities if the advisor or sub-advisor believes
they are comparable in quality.

Special Risks. Although securities rated "BBB" by S&P, Duff & Phelps
or Fitch, or Baa by Moody's are considered investment grade, they have
certain speculative characteristics. Therefore, they may be subject to
a higher risk of default than obligations with higher ratings.
Subsequent to its purchase by a Fund, a rated security may cease to be
rated or its rating may be reduced below the minimum rating required
for purchase by the Fund. The advisor or sub-advisor will consider
such an event in determining whether the Fund should continue to hold
the security.

Non-Investment Grade Credit Risk. Non-investment grade fixed income and
convertible securities are generally rated "BB" or below by S&P, Duff & Phelps
or Fitch, or "Ba" by Moody's.

Investment Strategy. All Equity Funds may invest a portion of their
total assets in non-investment grade securities when the advisor or
sub-advisor determines that such securities are desirable in light of
the Funds' investment objectives and portfolio mix.

Tracking Risk. Because the Index 500 Fund pays fees and transaction costs, while
the S&P 500 does not, the Fund's returns are likely to be lower than those of
the S&P 500. Tracking variance may also result from share purchases and
redemptions and other factors.

Short-Term Trading. The Funds' historical portfolio turnover rates are shown in
the Financial Highlights.

Investment Strategy. Some Funds may engage in short-term trading,
including, in the case of the Equity Funds, initial public offerings.

40
<PAGE>

Special Risks. A high rate of portfolio turnover (100% or more) could
produce higher trading costs and taxable distributions, which could
detract from a Fund's performance.

Defensive Investing. Each Fund (except the Index 500 Fund) may invest all or
any portion of its assets in short-term obligations as a temporary defensive
measure in response to adverse market or economic conditions.

Special Risks. A Fund may not achieve its investment objective when
its assets are invested in short-term obligations The Index 500 Fund
cannot take steps to reduce market exposure or to lessen the effects of
a declining market.

Additional Description Of Investments And Investment Strategies

Investment Strategy. All Income Funds, Balanced Fund, Framlington
Global Financial Services Funds and Cash Investment Fund may invest a
portion of its assets in Asset-Backed Securities.

Special Risks. In addition to credit and market risk, asset-backed
securities involve repayment risk because the underlying assets (loans)
may be prepaid at any time. The value of these securities may also
change because of actual or perceived changes in the creditworthiness
of the originator, the servicing agent, the financial institution
providing the credit support, or the counterparty. Like other fixed
income securities, when interest rates rise the value of an asset-
backed security generally will decline. However, when interest rates
decline, the value of an asset-backed security with prepayment features
may not increase as much as that of other fixed income securities. In
addition, non-mortgage asset-backed securities involve certain risks
not presented by mortgage-backed securities. Primarily, these
securities do not have the benefit of the same security interest in the
underlying collateral.

41
<PAGE>

the interest income earned by the Fund (from the investment of the
proceeds) will be less than the interest expense of the transaction,
that the market value of the securities sold by the Fund will decline
below the price the Fund is obligated to pay to repurchase the
securities, and that the securities may not be returned to the Fund.

Credit Quality of the Tax-Free Funds. The Tax-Free Funds will invest in
long-term instruments only if they are rated "A" or better by Moody's or S&P or,
if unrated, are of comparable quality. These Funds will invest in short-term
instruments only if they (i) have short-term debt ratings in the top two
categories by at least one nationally recognized statistical rating
organization, (ii) are issued by an issuer with such ratings or (iii) if
unrated, are of comparable quality.

Forward Currency Exchange Contracts. A forward currency exchange contract is an
obligation to exchange one currency for another on a future date at a specified
exchange rate.

Futures Contracts and Related Options. A futures contract is a type of
derivative instrument that obligates the holder to buy or sell an asset in the
future at an agreed upon price. When a Fund purchases an option on a futures
contract, it has the right to assume a position as a purchaser or seller of a
futures contract at a specified exercise price during the option period. When a
Fund sells an option on a futures contract, it becomes obligated to purchase or
sell a futures contract if the option is exercised.

Investment Strategy. The Equity Funds, the Income Funds and the Tax-
Free Funds may invest in futures contracts and options on futures
contracts on domestic or foreign exchanges or boards of trade. These
instruments may be used for hedging purposes, to maintain liquidity to
meet potential shareholder redemptions, to invest cash balances or
dividends, or to minimize trading costs.

Investment Strategy. The Income Funds, Cash Investment Fund and Money
Market Fund may invest in guaranteed investment contracts.

Special Risks. Guaranteed investment contracts are considered illiquid
investments and are acquired subject to a Fund's limitation on illiquid
investments.

Investment Strategy. Each Fund may invest up to 15% (10% in the case
of a Money Market Fund) of its net assets in securities that are
illiquid.

42
<PAGE>

Investment Companies. To the extent consistent with their respective investment
objectives and policies, the Funds (other than U.S. Treasury Money Market Fund)
may invest in securities issued by other investment companies.

Investment Strategy. Investments by a Fund in other investment
companies will be subject to the limitations of the 1940 Act.

Municipal Obligations. Municipal obligations may include: (i) general
obligation bonds issued for various public purposes and supported by the
municipal issuer's credit and taxing power; and (ii) revenue bonds whose
principal and interest is payable only from the revenues of a particular project
or facility.

Investment Strategy. The Tax-Free Funds and Tax-Free Money Market Fund
will normally invest at least 80% of their net assets in municipal
obligations.

Special Risks. Industrial revenue bonds depend on the credit standing
of a private issuer and may be subject to the federal alternative
minimum tax (AMT). Although Tax-Free Money Market Fund may invest more
than 25% of its net assets in municipal revenue obligations, it does
not intend to do so on a regular basis. If it does, it will be riskier
than a fund which does not concentrate to such an extent on similar
projects.

Investment Strategy. The Equity Funds, the Income Funds, Tax-Free Bond
Fund and Michigan Tax-Free Bond Fund may write (sell) covered call
options, buy put options, buy call options and write secured put
options for hedging purposes. Options may relate to particular
securities, foreign or domestic securities indices, financial
instruments or foreign currencies.

Special Risks. The value of options can be highly volatile, and their
use can result in loss if the advisor or sub-advisor is incorrect in
its expectation of price fluctuations. The successful use of options
for hedging purposes also depends in part on the ability of the advisor
or sub-advisor to predict future price fluctuations and the degree of
correlation between the options and securities markets.

Repurchase Agreements. Repurchase agreements involve the purchase of securities
by a Fund subject to the seller's agreement to repurchase them at a mutually
agreed upon date and price.

Investment Strategy. Each Fund may enter into repurchase agreements
with banks and broker-dealers that are deemed to be creditworthy by the
advisor or sub-advisor.

Investment Strategy. Securities lending may represent no more than 25%
of the value of a Fund's total assets (including the loan collateral).

Special Risks. The main risk when lending Fund securities is that if
the borrower fails

43
<PAGE>

to return the securities or the invested collateral has declined in
value, the Fund could lose money.

Investment Strategy. Each Fund may invest a portion of its assets in
short-term obligations pending investment or to meet anticipated
redemption requests. The Tax-Free Funds and Tax-Free Money Market Fund
may hold uninvested cash if, in the advisor's opinion, suitable tax-
exempt securities are not available. Each Tax-Free Fund may also invest
a portion of its assets in short-term money market instruments, the
income from which is subject to Federal income tax.

Special Risks. A Fund may not achieve its investment objective when
its asset are invested in short-term obligations.

Special Risks. Purchasing or selling securities on a when-issued,
delayed delivery or forward commitment basis involves the risk that the
value of the securities may change by the time they are actually issued
or delivered. These transactions also involve the risk that the seller
may fail to deliver the security or cash on the settlement date.

Zero Coupon Bonds. These are securities issued at a discount from their face
value because interest payments are typically postponed until maturity.

Disclaimers

The Index 500 Fund is not sponsored, endorsed, sold or promoted by S&P, nor does
S&P guarantee the accuracy and/or completeness of the S&P 500(R) Index or any
data included therein. S&P makes no warranty, express or implied, as to the
results to be obtained by the Fund, owners of the Fund, any

44
<PAGE>

person or any entity from the use of the S&P 500(R) Index or any data included
therein. S&P makes no express or implied warranties and expressly disclaims all
such warranties of merchantability or fitness for a particular purpose for use
with respect to the S&P Index or any data included therein.

45
<PAGE>

Your Investment
- --------------------------------------------------------------------------------

This section describes how to do business with the Funds.

How To Reach The Funds

By telephone: 1-800-438-5789
Call for account information

By mail: The Munder Funds
480 Pierce Street
Birmingham, MI 48009

Purchasing Shares

Who May Purchase Shares

Customers (and their immediate family members) of banks and other institutions
that have entered into agreements with us to provide shareholder services for
customers may purchase Class K Shares. Customers may include individuals,
trusts, partnerships and corporations. Each Fund also issues other classes of
shares, which have different sales charges, expense levels and performance. Call
(800) 438-5789 to obtain more information concerning the Funds' other classes of
shares.

Purchase Price of Shares

Class K shares of the Funds are sold at the NAV next determined after a purchase
order is received in proper form.

Method for Purchasing Shares
You may purchase shares through selected banks or other institutions.

Policies for Purchasing Shares

. All share purchases are effected through a customer's account at an
institution and confirmations of share purchases will be sent to the
institution involved.

. Institutions (or their nominees) will normally be the holders of record of
Fund shares acting on behalf of their customers, and will reflect their
customers' beneficial ownership of shares in the account statements
provided by them to their customers.

. Purchase orders must be received by the Fund's distributor or the transfer
agent before the close of regular trading on the New York Stock Exchange
(normally, 4:00 p.m. Eastern time).

Redeeming Shares

Redemption Price
We will redeem shares at the NAV next determined after we receive the redemption
request in proper form.

Methods for Redeeming Shares

. You may redeem shares of all Funds through your bank or other financial
institution.

. You may redeem a portion of your shares of the Income Funds (other than the
International Bond Fund), Tax-Free Funds and Money Market Funds through the
free checkwriting privilege.

Policies for Redeeming Shares

. Shares held by an institution on behalf of its customers must be redeemed
in accordance with instructions and limitations pertaining to the account
at that institution.

. If we receive a redemption order for a Fund (other than a Money Market
Fund) before 4:00 p.m. (Eastern time), we will normally wire payment to the
redeeming institution on the next business day. If we receive a redemption
order for a Money Market Fund before 12:00 noon (Eastern time), we will
normally wire payment to the redeeming institution on the same business
day. If an order for a Money Market Fund is received between 12:00 noon and
4:00 p.m. (Eastern time), payment is normally wired the next business day.

Additional Policies For Purchases And Redemptions

. We consider requests to be in "proper form" when all required
documents are properly completed, signed and received.

. If your purchase order payment for a Money Market Fund is received in
proper form before 2:45 p.m. (Eastern time), you will receive
dividends for that day. If your redemption order is received in proper
form before 2:45 p.m. (Eastern time), you will not receive dividends
for that day.

46
<PAGE>

. The Funds reserve the right to reject any purchase order.

. At any time, the Funds may change any of their purchase or redemption
procedures, and may suspend the sale of their shares.

. The Funds may delay sending redemption proceeds for up to seven days,
or longer if permitted by the Securities and Exchange Commission.

. To limit the Funds' expenses, we do not currently issue share
certificates.

. If you are redeeming recently purchased shares, your redemption
request may not be honored until your check or [electronic
transaction] has cleared. This may delay your transaction for up to 15
days.

. A Fund may temporarily stop redeeming shares if:

. the New York Stock Exchange is closed;
. trading on the New York Stock Exchange is restricted;
. an emergency exists and the Fund cannot sell its assets or
accurately determine the value of its assets;
. the Securities and Exchange Commission orders the Fund to suspend
redemptions.

. If accepted by a Fund, investors may purchase shares of the Fund
(other than the Real Estate Equity Investment Fund) with securities
that the Fund may hold. The advisor will determine if the securities
are consistent with the Fund's objectives and policies. If accepted,
the securities will be valued the same way the Fund values portfolio
securities it already owns. Call the Funds at (800) 438-5789 for more
information.

. We record all telephone calls for your protection and take measures to
identify the caller. As long as the Funds' transfer agent takes
reasonable measures to authenticate telephone requests on an
investor's account, neither the Funds, the Funds' distributor nor the
transfer agent will be held responsible for any losses resulting from
unauthorized transactions.

. Financial institutions are responsible for transmitting orders and
payments for their customers on a timely basis.

Shareholder Privileges

Free Checkwriting. Free checkwriting is available to holders of Class K shares
of the Income Funds (other than the International Bond Fund), Tax-Free Funds and
Money Market Funds who complete the signature card section of the account
application form. You may write checks in the amount of $500 or more but you may
not close a Fund account by writing a check. We may change or terminate this
program on 30 days' notice to you.

Service Agents

Class K shares of the Funds are sold through institutions that have entered into
shareholder servicing agreements with the Funds. These agreements are permitted
under the Funds' Shareholder Servicing Plan. Under the agreements, the
institutions provide shareholder services to their customers who are record or
beneficial owners of Class K shares. In return for providing these services, the
institutions are entitled to receive a fee from each Fund at an annual rate of
up to 0.25% of the average daily net asset value of the Class K shares owned by
their customers. Class K shares bear all fees paid to institutions under the
Shareholder Servicing Plan. Payments are not tied exclusively to the shareholder
expenses actually incurred by the institutions and may exceed service expenses
actually incurred.

Please note that Comerica Bank, an affiliate of the advisor, receives a fee from
the Funds for providing shareholder services to its customers who own shares of
the Funds.

In addition, the advisor may, from time to time, make payments to banks, broker-
dealers or other financial institutions for certain services to the Funds and/or
their shareholders, including sub-administration, sub-transfer agency and
shareholder servicing. The advisor may make such payments out of its own

47
<PAGE>

resources and there are no additional costs to the Funds or their shareholders.

48
<PAGE>

Pricing Of Fund Shares
- --------------------------------------------------------------------------------

Each Fund's NAV is calculated on each day the New York Stock Exchange is open.

The Funds (other than the Money Market Funds) calculate NAV as of the close of
business on the New York Stock Exchange, normally 4:00 p.m. (Eastern time). [The
Money Market Funds calculate NAV as of 2:45 p.m. (Eastern time) and as of the
close of business on the New York Stock Exchange, normally 4:00 p.m. (Eastern
time).]

If the New York Stock Exchange closes early, the Funds will accelerate their
calculation of NAV and transaction deadlines to that time.

The NAV of each Fund (other than the Money Market Funds) is generally based on
the market value of the securities held in the Fund. If market values are not
available, the fair value of securities is determined in good faith by, or using
procedures approved by, the Boards of Directors/Trustees of the Funds.

In determining each Money Market Fund's NAV, securities are valued at amortized
cost, which is approximately equal to market value.

49
<PAGE>

Distributions
- --------------------------------------------------------------------------------

As a shareholder you are entitled to your share of a Fund's net income and gains
on its investments. The Funds pass substantially all of its earnings along to
its shareholders as distributions. When the Funds earns dividends from stocks
and interest from debt securities and distributes these earnings to
shareholders, it is called a dividend distribution. A Fund realizes capital
gains when it sells securities for a higher price than it paid. When these gains
are distributed to shareholders, it is called a capital gain distribution.

Balanced Fund, Growth & Income Fund, Small Company Growth Fund, Index 500 Fund
and International Bond Fund: pay dividends, if any, quarterly.

Equity Selection Fund, Growth Opportunities Fund, Framlington Emerging Markets
Fund, Framlington Global Financial Services Fund, Framlington Healthcare Fund,
Framlington International Growth Fund, International Equity Fund, Micro-Cap
Equity Fund, Multi-Season Growth Fund, Small-Cap Value Fund and Value Fund: pay
dividends, if any, at least annually.

Bond Fund, Intermediate Bond Fund, U.S. Government Income Fund, Michigan Tax-
Free Bond Fund, Tax-Free Bond Fund, Tax-Free Short-Intermediate Bond Fund and
Real Estate Equity Investment Fund: pay dividends, if any, monthly.

Cash Investment Fund, Tax-Free Money Market Fund and U.S. Treasury Money Market
Fund: dividends are declared daily and paid monthly.

All Funds: distribute their net realized capital gains, if any, at least
annually.

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<PAGE>

Federal Tax Considerations
- --------------------------------------------------------------------------------

Taxes On Distributions

You will generally have to pay federal income tax on all Fund distributions.
Distributions will be taxed in the same manner whether you receive the
distributions in cash or in additional shares of the Fund. The Tax-Free Funds
and Tax-Free Money Market Fund expect that a portion of their dividend
distributions will be exempt from federal income tax. Shareholders not subject
to tax on their income, generally will not be required to pay any tax on
distributions.

Dividends and certain interest income earned from foreign securities by a Fund
may be subject to foreign withholding or other taxes. A Fund may be permitted to
pass on to its shareholders the right to a credit or deduction for income or
other tax credits earned from foreign investments and will do so if possible.
These deductions or credits may be subject to tax law limitations.

Taxes On Sales

If you sell shares of a Fund, you generally will be subject to tax on any
taxable gain. Your taxable gain is computed by subtracting your tax basis in the
shares from the redemption proceeds. Because your tax basis depends on the
original purchase price and on the price at which any dividends may have been
reinvested, you should be sure to keep account statements so that you or your
tax preparer will be able to determine whether a sale will result in a taxable
gain.

Other Considerations

If you have not provided complete, correct taxpayer information by law, the
Funds must withhold a portion of your distributions and redemption proceeds to
pay federal income taxes.
51
<PAGE>

MANAGEMENT
Investment Advisors And Sub-Advisor

Munder Capital Management "MCM", 480 Pierce Street, Birmingham, Michigan 48009
is the investment advisor of each Fund other than Index 500 Fund and
International Equity Fund. World Asset Management, L.L.C. "World", 255 East
Brown Street, Birmingham, Michigan 48009, is the investment advisor of the Index
500 Fund and the International Equity Fund. World is a wholly-owned subsidiary
of MCM. As of September 30, 1999, MCM [and its affiliates] had approximately $__
billion in assets under management, of which $__ billion were invested in equity
securities, $__ billion were invested in money market or other short-term
instruments, $__ billion were invested in other fixed income securities, and $__
billion in non-discretionary assets. As of September 30, 1999, World had
approximately $__ in assets under management.

Framlington Overseas Investment Management Limited "Framlington", a subsidiary
of MCM, is the sub-advisor of the Framlington Funds.

During the fiscal year ended June 30, 1999, each Fund paid an advisory fee at an
annual rate based on the average daily net assets of the Fund (after waivers, if
any) as follows:

Balanced Fund 0.65%
Equity Selection Fund 0.75%
Growth & Income Fund 0.75%
Growth Opportunities Fund 0.75%
Index 500 Fund [ ]%
International Equity Fund 0.75%
Micro-Cap Equity Fund 1.00%
Multi-Season Growth Fund 0.75%
Real Estate Equity Investment Fund 0.74%
Small-Cap Value Fund 0.75%
Small Company Growth Fund 0.75%
Value Fund 0.74%
Framlington Emerging Markets Fund 1.25%

Framlington Global Financial Services Fund 0.75%
Framlington Healthcare Fund 1.00%
Framlington International Growth Fund 1.00%
Bond Fund 0.50%
Intermediate Bond Fund 0.50%
International Bond Fund 0.50%
U.S. Government Income Fund 0.50%
Michigan Tax-Free Bond Fund 0.50%
Tax-Free Bond Fund 0.50%
Tax-Free Short-Intermediate Bond Fund 0.50%
Cash Investment Fund 0.40%
Tax-Free Money Market Fund 0.35%
U.S. Treasury Money Market Fund 0.35%

During the fiscal year ended June 30, 1999, a portion of the advisory fees for
the Index 500 Fund and the Multi-Season Growth Fund were waived. As a result,
the payments shown above for those Funds were less than the contractual advisory
fees of [[%] of the Index 500 Fund's average daily net assets] and 1.00% of the
first $500 million of the Multi-Season Growth Fund's average daily net assets
and .75% of that Fund's average daily net assets over $500 million.

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<PAGE>

Performance Information. The tables below contain performance information for
certain Funds created through the conversion of a common or collective trust
fund which had investment objectives and policies materially similar to those of
the corresponding Funds.
Immediately before and after the conversion, the same person managed both the
common or collective trust fund and the corresponding Fund.

The table for each Fund:

. includes the average annual total returns of the common or collective
trust fund and the average annual total returns of the corresponding
Fund linked together;
. assumes that net investment income and dividends have been reinvested;
. assumes that the common or collective trust fund paid the same levels
of fees and expenses as the corresponding Fund currently pays;
. does not reflect any potential negative impact on the common and
collective trust funds' performance if they had been subjected to the
same regulatory restrictions (the 1940 Act and the Internal Revenue
Code) as the corresponding Fund; and
. indicates past performance only and does not predict future results.

Munder Small
Company Russell
Period Ended Growth Fund 2000
June 30, 1999 (Class K )* Index**
- ------------- ---------- -------
1 Year....................... % %
3 Years...................... % %
5 Years...................... % %
10 Years..................... % %
Inception on December
31, 1982..................... % %
___________________________________
* Converted from collective trust fund to mutual fund on November 23, 1992.
** Russell 2000 Index performance shows total return in U.S. dollars but does
not reflect the deduction of fees, expenses and taxes. Source: Lipper Analytical
Services, Inc.

Munder FT/S&P
International Actuaries
Period Ended Equity Fund World Index
June 30, 1999 (Class K )* ex. U.S.**
------------- ---------- ----------
1 Year.......................... % %
3 Years......................... % %
5 Years......................... % %
Inception on September
30, 1990........................ % %
___________________________________
* Converted from collective trust fund to mutual fund on November 23, 1992.
** FT/S&P Actuaries World Index ex. U.S. performance shows total return in U.S.
dollars but does not reflect the deduction of fees, expenses and taxes. Source:
Ibbotson Associates, Inc.

Munder
Index 500 S&P
Period Ended Fund 500
June 30, 1999 (Class K )* Index**
------------- ---------- -------
1 Year.......................... % %
3 Years......................... % %
5 Years......................... % %
10 Years........................ % %
Inception on
January 27, 1988................ % %
__________________________________
* Converted from collective trust fund to mutual fund on December 7, 1992.
** S&P 500 Index performance shows total return in U.S. dollars but does not
reflect the deduction of fees, expenses and taxes. Source: Lipper Analytical
Services, Inc.

Lehman
Munder Bond Brothers
Period Ended Fund Gov't/Corp.
June 30, 1999 (Class K)* Bond Index**
------------- --------- ------------
1 Year.............................. % %
3 Years............................. % %
5 Years............................. % %
10 Years............................ % %
__________________________________
* Converted from collective trust fund to mutual fund on November 23, 1992.
** Lehman Brothers Government/Corporate Bond Index performance shows total
return in U.S. dollars but does not reflect the deduction of fees, expenses and
taxes. Source: Lipper Analytical Services, Inc.

53
<PAGE>

Munder U.S.
Government Lehman
Income Brothers
Period Ended Fund Gov't/Corp.
June 30, 1999 (Class K)* Bond Index**
1 Year.............................. % %
3 Years............................. % %
5 Years............................. % %
10 Years............................ % %
_________________________________
* Converted from collective trust fund to mutual fund on July 5, 1994.
** Lehman Brothers Government/Corporate Bond Index performance shows total
return in U.S. dollars but does not reflect the deduction of fees, expenses and
taxes. Source: Lipper Analytical Services, Inc.

Lehman
Munder Brothers
Intermediate Intermediate
Period Ended Bond Fund Gov't/Bond
June 30, 1999 (Class K)* Index**
------------- --------- -------
1 Year............................... % %
3 Years.............................. % %
5 Years.............................. % %
10 Years............................. % %
Inception on March 31,
1982................................. % %
_________________________________
* Converted from collective trust fund to mutual fund on November 20, 1992.
** Lehman Brothers Intermediate Government/Corporate Bond Index performance
shows total return in U.S. dollars but does not reflect the deduction of fees,
expenses and taxes. Source: Lipper Analytical Services, Inc.

Lehman
Munder 20-Year
Tax-Free Muni
Period Ended Bond Fund Bond
June 30, 1999 (Class K)* Index**
------------- --------- -------
1 Year............................... % %
3 Years.............................. % %
5 Years.............................. % %
10 Years............................. % %
_____________________________
* Converted from common trust fund to mutual fund on July 5, 1994.
** Lehman 20-Year Municipal Bond Index performance shows total return in U.S.
dollars but does not reflect the deduction of fees, expenses and taxes. Source:
Lipper Analytical Services, Inc.

Indices

The S&P 500 is a widely recognized unmanaged index of U.S. Stock Market
activity.

The Russell 2000 Index is a capitalization weighted total return index which is
comprised of 2,000 of the smallest capitalized U.S. domiciled companies whose
stock is traded in the United States on the New York Stock Exchange, American
Stock Exchange and the NASDAQ.

The FT/S&P Actuaries World Index ex. U.S. is an unmanaged index used to portray
the global equity market excluding the U.S. The Index is weighted based on the
market capitalization of those stocks selected to represent each country and
includes gross reinvestment of dividends.

The Lehman Brothers Government/Corporate Bond Index is a weighted composite of
(i) Lehman Brothers Government Bond Index, which is comprised of all publicly
issued, non-convertible debt of the U.S. Government or any agency thereof,
quasi-Federal corporations, and corporate debt guaranteed by the U.S. Government
and (ii) Lehman Brothers Corporate Bond Index, which is comprised of all public
fixed-rate, non-convertible investment-grade domestic corporate debt, excluding
collateralized mortgage obligations.

The Lehman Brothers Intermediate Government/Corporate Bond Index is a weighted
composite of (i) Lehman Brothers Intermediate Government Bond Index, which is
comprised of all publicly issued, non-convertible debt of the U.S. Government or
any agency thereof, quasi-Federal corporations and corporate debt guaranteed by
the U.S. Government with a maturity of between one and ten years and (ii) Lehman
Brothers Corporate Bond Index.

The Lehman Brothers 20-Year Municipal Bond Index is a performance benchmark for
the long-term investment-grade tax-exempt bond market.

Performance of Framlington Accounts Managed by the Sub-Advisor. The tables below
contain certain performance information provided by the sub-advisor relating to
accounts managed by the sub-advisor which have investment objectives and
policies similar to those of the corresponding Framlington Funds. In the case
of the Healthcare portfolio performance, the data relates to a unit trust
organized under the laws of the United Kingdom managed by the same personnel of
the sub-advisor with similar investment objectives and policies to the
Framlington Healthcare Fund. In the case of Emerging Markets portfolio
performance, the data relates to a Canadian-based institutional emerging markets
portfolio managed by the same personnel of the sub-advisor with similar
investment objectives and policies to the Framlington Emerging Markets Fund.

54
<PAGE>

The trust account performance is provided by Standard & Poor's Micropal, an
independent research organization that is a recognized source of performance
data in the UK unit trust industry. The data is U.S. dollar adjusted on the
basis of exchange rates provided by Datastream using WM/Reuters closing rates.
The performance figures are net of brokerage commissions, actual investment
advisory fees and initial sales charges. The data assume the reinvestment of net
income and capital gain distributions. The trust account returns are calculated
using beginning offer and ending bid prices for periods ended December 31, 1996.

You should not rely on the following performance data of the sub-advisor's
client accounts as an indication of future performance of the Framlington Funds.
It should be noted that the management of the Funds will be affected by
regulatory requirements under the 1940 Act and requirements of the Internal
Revenue Code to qualify as a regulated investment company.

S&P
Healthcare
U.K. Composite
Period Ended Health Index Capital
December 31, 1996 Portfolio Change
----------------- --------- ------
1 Year................................. 10.75% 18.48%
3 Years................................ 96.93% 100.49%
5 Years................................ 99.43% 45.60%
Inception on April
30, 1987............................... 411.08% 239.64%

Performance for the Health trust account is calculated on an offer-bid basis;
U.S. dollar adjusted total return net of all management fees but not reflective
of U.K. tax. Source: Standard & Poor's Micropal.

S&P Healthcare Composite Index performance shows capital change in U.S. dollars
but does not reflect the deduction of fees, expenses and taxes. Source:
Datastream.

MSCI
Canadian Emerging
Emerging Markets Free
Period Ended Markets Total
December 31, 1996 Account Return
----------------- ------- ------
1 Year..................................... 5.16 % 6.03 %
Inception on November
1, 1994.................................... (3.68)% (12.37)%

MSCI Emerging Markets Free Index performance shows total return in U.S. Dollars
but does not reflect the deduction of fees, expenses and taxes. Source:
Datastream.

Indices

The S&P Healthcare Composite Index is the composite Healthcare section of the
S&P 500 Index as defined and tracked by S&P. This index covers securities listed
in the United States only.

The MSCI Emerging Markets Free Index is maintained by Morgan Stanley Capital
International, and covers 26 countries and represents the investment
opportunities in emerging markets available to foreign investors. Total return
is calculated using the prices of the companies tracked and assumes the
reinvestment of dividends.

Portfolio Managers [to be revised]

Balanced Fund, Equity Selection Fund, Growth Opportunities Fund, Micro-Cap
Equity Fund And Small Company Growth Fund

A committee of professional portfolio managers employed by MCM makes investment
decisions for the Funds.

Growth & Income Fund

International Equity Fund

Todd B. Johnson and Theodore Miller jointly manage the Fund. Mr. Johnson,
President and Chief Investment Officer of World, and Mr. Miller, senior
portfolio manager of the Fund, have managed the Fund since July 1992 and October
1996, respectively. Mr. Miller previously worked as the primary analyst for the
Fund (1996) and for Interacciones Global Inc. (1993-1995).

Multi-Season Growth Fund

Leonard J. Barr II has been the Fund's portfolio manager since the Fund's
inception in April 1993. Mr. Barr is the Senior Vice President and Director of
Research of MCM.

Real Estate Equity Investment Fund

55
<PAGE>

Small-Cap Value Fund And Value Fund

Gerald Seizert, Edward Eberle and Brian Wall jointly manage the Funds. Mr.
Seizert, Chief Investment Officer -Equities of the advisor, has managed the
Funds since they commenced operations. Prior to joining MCM in 1995, Mr. Seizert
was a Director and Managing Partner of Loomis, Sayles & Company, L.P. (1984-
1995). Mr. Eberle, who has managed the Small-Cap Value Fund since March 1997 and
the Value Fund since October 1996, was formerly the primary analyst for the
Funds. Prior to joining MCM in 1995, he was an Executive Vice President and
Portfolio Manager for Westpointe Financial Corporation. Mr. Wall, who has
managed the Funds since [March 1997], was formerly a primary analyst for the
Funds. Prior to joining MCM in 1995, he was a Senior Equity Analyst with
Woodbridge Capital Management, Inc. (1994-1995).

Framlington Emerging Markets Fund

A committee of professional portfolio managers employed by Framlington makes
investment decisions for the Fund. William Calvert heads the committee.

Framlington Global Financial Services Fund

A committee of professional managers employed by the MCM or Framlington makes
decisions for the Fund.

Framlington Healthcare Fund

Antony Milford, head of the Specialist Desk for Framlington, has been the Fund's
primary portfolio manager since the Fund's inception. Mr. Milford has managed
funds for Framlington since 1971.

Framlington International Growth Fund

A committee of professional portfolio managers employed by Framlington makes
investment decisions for the Fund. Simon Key, Chief Investment Officer of
Framlington, heads the committee.

Bond Fund

James C. Robinson and Gregory A. Prost jointly manage the Fund. Mr. Robinson and
Mr. Prost have managed the Fund since March 1995 and May 1995, respectively. Mr.
Robinson has been a Vice President and Chief Investment Officer of MCM or Old
MCM since 1987. Mr. Prost has been a Senior Fixed Income Portfolio of MCM or Old
MCM since 1995. Prior to joining MCM, he was a Vice President and Senior Fund
Manager for First of America Investment Corp.

Intermediate Bond Fund

Anne K. Kennedy and James C. Robinson jointly manage the Fund. Ms. Kennedy, Vice
President and Director of Corporate Bond Trading of MCM or Old MCM since 1991,
has managed the Fund since March 1995. Mr. Robinson, Vice President and Chief
Investment Officer of MCM or Old MCM since 1987, has managed the Fund since
March 1995.

International Bond Fund

Gregory A. Prost and Sharon E. Fayolle jointly manage the Fund. Mr. Prost,
Senior Fixed Income Portfolio Manager of MCM or Old MCM, has managed the Fund
since October 1996. Prior to joining MCM in 1995, he was a Vice President and
Senior Fund Manager for First of America Investment Corp. Ms. Fayolle, Vice
President and Director of Money Market Trading for MCM or Old MCM, has managed
the Fund since 1996. Prior to that she managed an international portfolio for
Ford Motor Company.

U.S. Government Income Fund

James C. Robinson and Peter G. Root jointly manage the Fund. Mr. Robinson, Vice
President and Chief Investment Officer of MCM or Old MCM since 1987, and Mr.
Root, Vice President and Director of Government Securities Trading of MCM since
March 1995, have managed the Fund since March 1995. Mr. Root joined MCM in 1991.

56
<PAGE>

Michigan Tax-Free Bond Fund, Tax-Free Bond Fund And Tax-Free Short-Intermediate

Bond Fund

Talmadge D. Gunn, Vice President and Director of Tax-Exempt Trading of MCM since
1993, manages the Tax-Free Funds.

Index 500 Fund

Todd B. Johnson and Kenneth A. Schluchter III jointly manage the Fund. Mr.
Johnson, a Chief Investment Officer of MCM, has been the portfolio manager of
the Fund since July 1992. Mr. Schluchter, who has managed the Fund since June
1997, was previously a Systems Developer and Data Analyst for Compuware
Incorporated (1993-1995).

57
<PAGE>

Financial Highlights
- --------------------------------------------------------------------------------

The financial highlights table is intended to help shareholders understand each
Fund's financial performance for the past 5 years (or, if shorter, the period of
the Fund's operations). Certain information reflects financial results for a
single Fund share. The total returns in the table represent the rate that an
investor would have earned (or lost) on an investment in the Fund (assuming
reinvestment of all dividends and distributions). Because the Class K shares of
Equity Selection Fund, Growth Opportunities Fund and Framlington Global
Financial Services Fund had not yet commenced operations on June 30, 1999,
financial highlights are not presented for those Funds. The information has been
audited by Ernst & Young LLP, independent accountants, whose report, along with
each Fund's financial statements, are included in the annual reports of the
Funds, and are incorporated by reference into the Statement of Additional
Information. You may obtain the annual reports without charge by calling (800)
438-5789.

<TABLE>
<CAPTION>
Balanced Fund (a)
-----------------------------------------------------------------------
Year Year Year Period Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e)
--------- --------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......................
Income from investment operations:
Net investment income
Net realized and unrealized gain/(loss) on investments.....
Total from investment operations...........................
Less distributions:
Dividends from net investment income.......................
Distributions from net realized gains......................
Total distributions........................................
Net asset value, end of period.............................
Total return (b)...........................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).......................
Ratio of operating expenses to average net assets..........
Ratio of net investment income to average net assets.......
Portfolio turnover rate....................................
Ratio of operating expenses to average net assets without
waivers....................................................
</TABLE>

_______________________

58
<PAGE>

<TABLE>
<CAPTION>
Growth & Income Fund (a)
-----------------------------------------------------------------------
Year Year Year Year Period Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e)
--------- --------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......................
Income from investment operations:
Net investment income......................................
Net realized and unrealized gain on investments............
Total from investment operations...........................
Less distributions:
Dividends from net investment income.......................
Distributions from net realized gains......................
Total distributions........................................
Net asset value, end of period.............................
Total return (b)...........................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).......................
Ratio of operating expenses to average net assets..........
Ratio of net investment income to average net
assets.....................................................
Portfolio turnover rate....................................
Ratio of operating expenses to average net assets
without waivers............................................
</TABLE>

_________________________________

59
<PAGE>

<TABLE>
<CAPTION>
Index 500 Fund (a)
----------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96(d) 6/30/95(e) 2/28/95(d,f)
--------- --------- --------- ------------ ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......................
Income from investment operations:
Net investment income......................................
Net realized and unrealized gain on investments............
Total from investment operations...........................
Less distributions:
Dividends from net investment income.......................
Distributions from net realized gains......................
Total distributions........................................
Net asset value, end of period.............................
Total return (b)...........................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).......................
Ratio of operating expenses to average net assets..........
Ratio of net investment income to average net assets.......
Portfolio turnover rate....................................
Ratio of operating expenses to average net assets..........
without waivers............................................
</TABLE>

________________________

60
<PAGE>

<TABLE>
<CAPTION>
International Equity Fund (a)
-------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(d) 6/30/96(d) 6/30/95(e) 2/28/95(d,f)
--------- --------- ------------ ------------ ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..................
Income from investment operations:
Net investment income.................................
Net realized and unrealized gain/(loss)on
investments...........................................
Total from investment operations......................
Less distributions:
Dividends from net investment income..................
Distributions from net realized gains.................
Distributions from capital............................
Total distributions...................................
Net asset value, end of period........................
Total return (b)......................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)..................
Ratio of operating expenses to average net assets.....
Ratio of net investment income to average net assets
Portfolio turnover rate...............................
Ratio of operating expenses to average net assets
without waivers.......................................
</TABLE>

_____________________________

61
<PAGE>

<TABLE>
<CAPTION>
Micro-Cap Equity Fund (a)
-------------------------------------
Year Year Period
Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97(e)
-------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period................................
Income from investment operation:
Net investment income/(loss)........................................
Net realized and unrealized gain/(loss) on investments..............
Total from investment operations....................................
Less distributions:
Dividends from net investment income................................
Distributions from net realized gains...............................
Total distributions.................................................
Net asset value, end of period......................................
Total return (b)....................................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)................................
Ratio of operating expenses to average net assets...................
Ratio of net investment income/(loss) to average net assets.........
Portfolio turnover rate.............................................
Ratio of operating expenses to average net assets without
waivers and/or expenses reimbursed..................................
</TABLE>

________________________

62
<PAGE>

<TABLE>
<CAPTION>
Multi-Season Growth Fund (a)
---------------------------------------------------------------
Year Year Year Year Period
Ended Ended Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97(e) 6/30/96(e) 6/30/95(d,f)
---------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period..........................
Income from investment operation:
Net investment income/(loss)..................................
Net realized and unrealized gain/(loss) on investments........
Total from investment operations..............................
Less distributions:
Dividends from net investment income..........................
Distributions from net realized gains.........................
Total distributions...........................................
Net asset value, end of period................................
Total return (b)..............................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)..........................
Ratio of operating expenses to average net assets.............
Ratio of net investment income/(loss) to average net assets...
Portfolio turnover rate.......................................
Ratio of operating expenses to average net assets without
waivers and/or expenses reimbursed............................
</TABLE>

______________________

63
<PAGE>

Real Estate Equity Investment Fund (a) Small-Cap Value Fund (a)
-------------------------------------------------------------------------
Year Year Period Year Year Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97 6/30/99 6/30/98(d) 6/30/97(d)
--------- ------------ --------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period................
Income from investment operations:
Net investment income...............................
Net realized and unrealized gain on investments.....
Total from investment operations....................
Less distributions:
Dividends from net investment income................
Distributions in excess of net investment income....
Distributions from net realized gains...............
Distributions from paid-in capital..................
Total distributions.................................
Net asset value, end of period......................
Total return (b)....................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)................
Ratio of operating expenses to average net
assets..............................................
Ratio of net investment income to average net
assets..............................................
Portfolio turnover rate.............................
Ratio of operating expenses to average net assets
without waivers and/or expenses reimbursed..........
</TABLE>

_______________________

64
<PAGE>

<TABLE>
<CAPTION>
Small Company Growth Fund (a)
--------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e)
--------- ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.....................
Income from investment operations:
Net investment loss
Net realized and unrealized gain/(loss) on investments...
Total from investment operations.........................
Less distributions:
Distributions from net realized gains....................
Total distributions......................................
Net asset value, end of period...........................
Total return (b).........................................
Ratio to average net assets/supplemental data:
Net assets, end of period (000's)........................
Ratio of operating expenses to average net assets........
Ratio of net investment loss to average net assets.......
Portfolio turnover rate..................................
Ratio of operating expenses to average net assets........
without waivers..........................................
</TABLE>

_________________________

65
<PAGE>

<TABLE>
<CAPTION>
Value Fund (a)
--------------------------------------------------------
Year Year Year Period
Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/96(d)
--------- ------------ ------------ -------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period............................
Income from investment operations:
Net investment income...........................................
Net realized and unrealized gain on investments.................
Total from investment operations................................
Less distributions:
Dividends from net investment income............................
Distributions from net realized gains...........................
Total distributions.............................................
Net asset value, end of period..................................
Total return (b)................................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)............................
Ratio of operating expenses to average net assets...............
Ratio of net investment income to average net assets............
Portfolio turnover rate.........................................
Ratio of operating expenses to average net assets
without waivers and/or expenses reimbursed......................
___________________________________________________
</TABLE>

66
<PAGE>

<TABLE>
<CAPTION>
Framlington Emerging Markets
Fund (a) Framlington Healthcare Fund (a)
-----------------------------------------------------------------------
Year Year Period Year Year Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/99 6/30/98(d) 6/30/97
---------- ----------- ------------ --------- ------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period....................
Income from investment operations:
Net investment income/(loss)............................
Net realized and unrealized gain on
investments.............................................
Total from investment operations........................
Less distributions:
Dividends from net investment income....................
Distributions from net realized gains...................
Distributions in excess of net realized gains...........
Total distributions.....................................
Net asset value, end of period..........................
Total return (b)........................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)....................
Ratio of operating expenses to average
net assets..............................................
Ratio of net investment income/(loss) to average
net assets..............................................
Portfolio turnover rate.................................
Ratio of operating expenses to average net assets
without expenses reimbursed.............................

- ---------------------------------
</TABLE>

67
<PAGE>

<TABLE>
<CAPTION>
Framlington International Growth
Fund (a)
------------------------------------
Year Year Period
Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d)
--------- ------------ ------------
<S> <C> <C> <C>
Net asset value, beginning of period...................................
Income from investment operations:
Net investment income/(loss)...........................................
Net realized and unrealized gain on investments........................
Total from investment operations.......................................
Less distributions:
Dividends from net investment income...................................
Distributions from net realized gains..................................
Distributions in excess of net realized gains..........................
Total distributions....................................................
Net asset value, end of period.........................................
Total return (b).......................................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...................................
Ratio of operating expenses to average net assets......................
Ratio of net investment income/(loss) to average
net assets.............................................................
Portfolio turnover rate................................................
Ratio of operating expenses to average net assets
without expenses reimbursed............................................
</TABLE>
_______________________________

68
<PAGE>

<TABLE>
<CAPTION>
Bond Fund (a)
------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97 6/30/96 6/30/95(e) 2/28/95(d,f)
--------- ----------- --------- --------- --------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...............
Income from investment operations:
Net investment income..............................
Net realized and unrealized gain/(loss) on
investments........................................
Total from investment operations...................
Less distributions:
Dividends from net investment income...............
Distributions from net realized gains..............
Total distributions................................
Net asset value, end of period.....................
Total return (b)...................................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000's)...............
Ratio of operating expenses to average net
assets.............................................
Ratio of net investment income to average
net assets.........................................
Portfolio turnover rate............................
Ratio of operating expenses to average net
assets without waivers.............................
</TABLE>
__________________________________________

69
<PAGE>

<TABLE>
<CAPTION>
Intermediate Bond Fund (a)
--------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96 6/30/95(d) 2/28/95(e)
---------- ---------- ----------- --------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...............
Income from investment operations:
Net investment income..............................
Net realized and unrealized gain/(loss) on
investments........................................
Total from investment operations...................
Less distributions:
Dividends from net investment income...............
Distributions from net realized gains..............
Total distributions................................
Net asset value, end of period.....................
Total return (b)...................................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000's)...............
Ratio of operating expenses to average net
assets.............................................
Ratio of net investment income to average
net asseets........................................
Portfolio turnover rate............................
Ratio of operating expenses to average net
assets without waivers ...........................
</TABLE>
_______________________________

70
<PAGE>

<TABLE>
<CAPTION>
International Bond Fund (a)
-----------------------------------
Year Year Period
Ended Ended Ended
6/30/99 6/30/98 6/30/97
---------- ---------- ---------
<S> <C> <C> <C>
Net asset value, beginning of period...........
Income from investment operations:
Net investment income/(loss)...................
Net realized and unrealized gain/(loss) on
investments....................................
Total from investment operations...............
Less distributions:
Dividends from net investment income...........
Distributions from net realized gains..........
Total distributions............................
Net asset value, end of period.................
Total return (b)...............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...........
Ratio of operating expenses to average net
assets.........................................
Ratio of net investment income/(loss) to
average net assets.............................
Portfolio turnover rate........................
Ratio of operating expenses to average net
assets without waivers.........................
</TABLE>
_______________

71
<PAGE>

<TABLE>
<CAPTION>
U.S. Government Income Fund (a)
-------------------------------------------------------------------------
Year Year Year Year Period Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96(f) 6/30/95(d) 2/28/95(e)
--------- --------- --------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...........
Income from investment operations:
Net investment income/(loss)...................
Net realized and unrealized gain/(loss) on
investments....................................
Total from investment operations...............
Less distributions:
Dividends from net investment income...........
Distributions from net realized gains..........
Total distributions............................
Net asset value, end of period.................
Total return (b)...............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...........
Ratio of operating expenses to average net
assets.........................................
Ratio of net investment income/(loss) to
average net assets.............................
Portfolio turnover rate........................
Ratio of operating expenses to average net
assets without waivers.........................
</TABLE>
_________________

72
<PAGE>

<TABLE>
<CAPTION>
Michigan Tax-Free Bond Fund(a)
-------------------------------------------------------------------------------------
Year Year Year Year Period Period Year
Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(d) 6/30/96(f) 6/30/95(d) 2/28/95(d,e) 8/95(d,f)
--------- --------- ------------ ------------ --------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...........
Income from investment operations:
Net investment income..........................
Net realized and unrealized gain/(loss) on
investments....................................
Total from investment operations...............
Less distributions:
Dividends from net investment income...........
Distributions from net realized gains..........
Total distributions............................
Net asset value, end of period.................
Total return (b)...............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...........
Ratio of operating expenses to average net
assets.........................................
Ratio of net investment income to average net
assets.........................................
Portfolio turnover rate........................
Ratio of operating expenses to average net
assets without waivers.........................
</TABLE>
_________________

73
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Bond Fund (a)
---------------------------------------------------------------------------
Year Year Year Year Period Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96(f) 6/30/95(d,f) 2/28/95(e)
--------- --------- --------- ------------ -------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...........
Income from investment operations:
Net investment income).........................
Net realized and unrealized gain on
investments....................................
Total from investment operations...............
Less distributions:
Dividends from net investment income...........
Distributions from net realized gains..........
Total distributions............................
Net asset value, end of period.................
Total return (b)...............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...........
Ratio of operating expenses to average net
assets.........................................
Ratio of net investment income to average net
assets.........................................
Portfolio turnover rate........................
Ratio of operating expenses to average net
assets without waivers.........................
</TABLE>
_________________

74
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Short-Intermediate Fund (a)
-----------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e)
--------- --------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..................
Income from investment operations:
Net investment income.................................
Net realized and unrealized gain/(loss) on
investments...........................................
Total from investment operations......................
Less distributions:
Dividends from net investment income..................
Distributions from net realized gains.................
Total distributions...................................
Net asset value, end of period........................
Total return (b)......................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)
Ratio of operating expenses to average net
assets................................................
Ratio of net investment income to average net
assets................................................
Portfolio turnover rate...............................
Ratio of operating expenses to average net assets
without waivers.......................................
</TABLE>

______________________

75
<PAGE>

<TABLE>
<CAPTION>
Cash Investment Fund (a)
------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
---------- --------- --------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..................
Income from investment operations:
Net investment income.................................
Total from investment operations......................
Less distributions:
Dividends from net investment income..................
Total distributions...................................
Net asset value, end of period........................
Total return (b)......................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)..................
Ratio of operating expenses to average net assets.....
Ratio of net investment income to average net assets..
Ratio of operating expenses to average net assets
without waivers.......................................
</TABLE>

76
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Money Market Fund (a)
-----------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
--------- --------- --------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.....................
Income from investment operations:
Net investment income....................................
Total from investment operations.........................
Less distributions:
Dividends from net investment income.....................
Total distributions......................................
Net asset value, end of period...........................
Total return (b).........................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).....................
Ratio of operating expenses to average net
assets...................................................
Ratio of net investment income to average net
assets...................................................
Ratio of operating expenses to average net assets
without waivers..........................................
</TABLE>

_____________

77
<PAGE>

<TABLE>
<CAPTION>
U.S. Treasury Money Market Fund (a)
-----------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
--------- --------- --------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.....................
Income from investment operations:
Net investment income....................................
Total from investment operations.........................
Less distributions:
Dividends from net investment income.....................
Total distributions......................................
Net asset value, end of period...........................
Total return (b).........................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).....................
Ratio of operating expenses to average net
assets...................................................
Ratio of net investment income to average net
assets...................................................
Ratio of operating expenses to average net assets
without waivers..........................................
</TABLE>

78
<PAGE>

For More Information

<TABLE>
<S> <C>
To Obtain Information:

-------------------------------------------------------
More information about the Funds is available free upon request,
including the following: By telephone
Call 1-800-438-5789
Annual/Semi-Annual Reports
By mail
You will receive unaudited semi-annual reports and audited annual The Munder Funds
reports on a regular basis from the Funds. In addition, you will 480 Pierce Street
also receive updated Prospectuses or Supplements to this Birmingham, MI 48009
Prospectus. In order to eliminate duplicate mailings, the Funds
will only send one copy of the above communications to (1) accounts On the Internet
with the same primary record owner, (2) joint tenant accounts, (3)
tenant in common accounts and (4) accounts which have the same Text-only versions of fund
address. documents can be viewed online or downloaded
from:

Securities and Exchange Commission
Statement Of Additional Information http://www.sec.gov

Provides more details about the Funds and their policies. A You can also obtain copies by visiting the
current Statement of Additional Information is on file with the Securities and Exchange Commissions Public
Securities and Exchange Commission and is incorporated by reference Reference Room in Washington, D.C. (phone
(is legally considered part of this prospectus). 1-800-SEC-0330) or by sending your request and
a duplicating fee to the Securities and
Exchange Commissions Public Reference Section,
Washington, D.C. 20549-6009.

You may also find more information about the
Funds on the Internet at:
http://www.munderfunds.com

--------------------------------------------------------
</TABLE>

The Munder Funds, Inc.
SEC file number: 811-7346

The Munder Funds Trust
SEC file number: 811-5899

The Munder Framlington Funds Trust
SEC file number: 811-7897
<PAGE>

Class Y Shares

[Munder Logo]

Prospectus

October 26, 1999

The Munder Equity Funds
Balanced
Equity Selection
Growth & Income
Growth Opportunities
International Equity
Micro-Cap Equity
Multi-Season Growth
NetNet
Real Estate Equity Investment
Small-Cap Value
Small Company Growth
Value

The Munder Framlington Funds
Framlington Emerging Markets
Framlington Global Financial Services
Framlington Healthcare
Framlington International Growth

The Munder Income Funds
Bond
Intermediate Bond
International Bond
U.S. Government Income
Michigan Tax-Free Bond
Tax-Free Bond
Tax-Free Short-Intermediate Bond
Short Term Treasury

The Munder Money Market Funds
Cash Investment
Money Market
Tax-Free Money Market
U.S. Treasury Money Market

As with all mutual funds, the Securities and
Exchange Commission has not approved or
disapproved these securities nor passed upon the
accuracy or adequacy of this prospectus. It is a
criminal offense to state otherwise.

<PAGE>

Table Of Contents

Risk/Return Summary
. Equity Funds
. Income Funds
. Tax-Free Funds
. Money Market Funds
Summary of Principal Risks
Who May Want To Invest
Fees And Expenses

More About The Funds
Glossary
Special Risks And Other Considerations
Additional Description of Investments And Common Investment Techniques

Your Investment
How To Reach The Fund
Purchasing Shares
Exchanging Shares
Redeeming Shares
Additional Policies For Purchases, Exchanges And Redemptions
Shareholder Privileges

Pricing of Fund Shares

Distributions

Federal Tax Considerations
Taxes On Distributions
Taxes On Sales Or Exchanges
Other Considerations

Management
Investment Advisors And Sub-Advisor
Portfolio Managers

Financial Highlights

Back Cover For Additional Information

2
<PAGE>

Risk/Return Summary
- --------------------------------------------------------------------------------
This Risk/Return Summary briefly describes the goals and principal investment
strategies of the Funds and the principal risks of investing in the Funds. For
further information on these and the Funds' other investment strategies and
risks, please read the section entitled More About The Funds.

. how the Fund's average annual returns for 1, 5, and 10 years (or over the
life of the Fund if the Fund is less than 10 years old) compare to those of a
broad based securities market index; and;

. changes in the Fund's performance from year to year over 10 years (or over
the life of the Fund if the Fund is less than 10 years old).

When you consider this information, please remember that a Fund's performance in
past years is not necessarily an indication of how the Fund will perform in the
future.

An investment in the Funds is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency.

Certain terms used in this prospectus are defined in the Glossary.

- --------------------------------------------------------------------------------
Equity Funds
- --------------------------------------------------------------------------------

Balanced Fund

Goal

The Fund's goal is to provide an attractive investment return through a
combination of growth of capital and current income.

Principal Investment Strategies

The Fund pursues its goal by allocating its assets among three asset groups:
equity securities, fixed income securities and cash equivalents.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

3
<PAGE>

Principal Risks

Among the principal risks of investing in the Fund are market risk, interest
rate risk and credit risk. To the extent that the Fund purchases foreign
securities, it may be subject to foreign securities risk. To the extent that
the Fund enters into futures and options on futures contracts, it may be subject
to derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year 5 Years (4/13/93)
---------- ----------- -------------------------
Class Y
[Index]

4
<PAGE>

Equity Selection Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities.

The Fund invests in equity securities which the advisor believes are undervalued
compared to stocks of other companies in the same industry.

The Fund generally invests in companies with market capitalizations of at least
$1 billion.

The Fund diversifies its assets by industry in approximately the same weightings
as those of the S&P 500.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

5
<PAGE>

Growth & Income Fund

Goal

The Fund's goal is to provide capital appreciation and current income.

Principal Investment Strategies

The Fund pursues its goal by investing primarily in dividend-paying equity
securities. Under normal circumstances, the Fund will invest at least 65% of its
assets in income-producing common stocks and convertible preferred stocks.

The Fund may also purchase fixed income securities which are convertible into or
exchangeable for common stock.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (7/5/94)
-------------- ---------------------------
Class Y
[Index]

6
<PAGE>

Growth Opportunities Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in the equity
securities of companies with market capitalizations between $500 million and $10
billion.

Its style, which focuses on both growth prospects and valuation, is known as
GARP (Growth at a Reasonable Price) and seeks to produce attractive returns
during various market environments.

The advisor chooses the Fund's investments by reviewing the earnings growth of
approximately 10,000 companies over the past three years and investing in
approximately 50 to 100 companies based on:

. superior earnings growth;
. financial stability;
. relative market value; and
. price changes compared to the S&Ps MidCap 400 Index.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

7
<PAGE>

International Equity Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing primarily in foreign securities including
American Depositary Receipts.

The Fund emphasizes companies with a market capitalization of at least $250
million.

The Fund may also enter into futures and options on futures contracts and
forward currency exchange contracts, and purchase and sell options.

Principal Risks

Among the principal risks of investing in the Fund are market risk, foreign
securities risk and currency risk. To the extent that the Fund enters into
futures and options on futures contracts, enters into forward currency exchange
contracts, and purchases and sells options, it may be subject to derivatives
risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1992 _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (12/1/91)
-------------- ------------- ------------
Class Y
[Index]

8
<PAGE>

Micro-Cap Equity Fund

Goal

The Fund's goal is to provide capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities of small capitalization companies. Small capitalization companies
means companies having market capitalizations within the range of the companies
in the Wilshire Micro-Cap Index. As of the date of this prospectus, such
capitalizations do not exceed approximately $300 million, which is considerably
less than the market capitalization of S&P 500 companies.

The Fund attempts to provide investors with potentially higher returns than a
fund that invests primarily in larger, more established companies. Since
smaller capitalization companies are generally not as well known to investors
and have less of an investor following than larger companies, they may provide
higher returns due to inefficiencies in the marketplace.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (12/26/96)
-------------- -----------------------------
Class Y
[Index]

9
<PAGE>

Multi-Season Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation. This goal is
"fundamental" and cannot be changed without shareholder approval.

Principal Investment Strategies

The advisor chooses the Fund's investments by reviewing the earnings growth of
approximately 5,500 companies over the past five years and investing in
approximately 50 to 100 companies based on:

. superior earnings growth;
. financial stability;
. relative market value; and
. price changes compared to the S&P 500.

The Fund may also purchase foreign securities.

Principal Risks

Among the principal risks of investing in the Fund is market risk. To the
extent that the Fund purchases foreign securities, it may be subject to foreign
securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

Calendar Year Total Return

1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (8/16/93)
---------------- --------------- --------------
Class Y
[Index]

10
<PAGE>

NetNet Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing, under normal market conditions, at least
65% of its assets in equity securities.

The Fund invests in companies which are engaged in research, design, development
or manufacturing activities related to the Internet or Intranet. Investments
will also be made in companies involved to a significant extent in the business
of distributing products, processes or services for or through the Internet or
Intranet.

The Internet is a world-wide network of computers designed to permit users to
share information and transfer data quickly and easily. The World Wide Web
("WWW"), which is a means of graphically interfacing with the Internet, is a
hyper-text based publishing medium containing text, graphics, interactive
feedback mechanisms and links within WWW documents and to other WWW documents.
An Intranet is the application of WWW tools and concepts to a company's internal
documents and databases.

The Fund may also invest in foreign securities and purchase and sell options.

Principal Risks

Among the principal risks of investing in the Fund are market risk, sector risk,
medium-size company risk and small company risk. To the extent that
the Fund purchases foreign securities, it may be subject to foreign securities
risk. To the extent that it purchases and sells options, it may be subject to
derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (8/__/96)
------------- ----------------------------
Class Y
[Index]

11
<PAGE>

Real Estate Equity Investment Fund

Goal

The Fund's goal is to provide both capital appreciation and current income.
This goal is "fundamental" and cannot be changed without shareholder approval.

Principal Investment Strategies

In addition, the Fund may invest:
. up to 35% of its assets in companies other than real estate industry
companies;
. in fixed income securities including up to 5% of its assets in debt
securities rated below investment grade or unrated if secured by real estate
assets and if the advisor believes that the underlying collateral is
sufficient; and
. in REITS only if they are traded on a securities exchange or NASDAQ.

Principal Risks

Among the principal risks of investing in the Fund are market risk and sector
risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1995: _____%
1996: _____%
1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (10/3/94)
----------------- ------------------
Class Y
[Index]

12
<PAGE>

Small-Cap Value Fund

Goal

The Fund's goal is to provide long-term capital appreciation, with income as a
secondary objective.

Principal Investment Strategies

In addition to valuation, the advisor considers these factors, among others, in
choosing companies:

. a stable or improving earnings record;

. sound finances;

. above-average growth prospects;

. participation in a fast growing industry;

. strategic niche position in a specialized market; and

. adequate capitalization.

The Fund may invest in equity securities of larger capitalization companies.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk and small
company stock risk. To the extent that the Fund purchases foreign securities,
it may be subject to foreign securities risk. To the extent that the Fund
enters into futures and options on futures contracts, it may be subject to
derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (12/26/96)
------------- ------------------------
Class Y
[Index]

13
<PAGE>

Small Company Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund attempts to provide investors with potentially higher returns than a
fund that invests primarily in larger, more established companies. Since
smaller capitalization companies are generally not as well-known to investors
and have less of an investor following than larger companies, they may provide
higher returns due to inefficiencies in the marketplace.

The advisor considers these factors, among others, in choosing companies:

. above-average growth prospects;

. participation in a fast-growing industry;

. strategic niche position in a specialized market; and

. adequate capitalization.

The Fund may also invest in foreign securities.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year 5 Years (12/1/91)
------------- ------------- ---------------------
Class Y
[Index]

14
<PAGE>

Value Fund

Goal

The Fund's primary goal is to provide long-term capital appreciation. Its
secondary goal is to provide income.

Principal Investment Strategies

The Fund pursues its goals by investing primarily in the equity securities of
well-established companies with intermediate to large capitalizations, which
typically exceed $750 million.

The Fund will invest at least 65% of its assets in equity securities.

In addition to valuation, the advisor considers these factors, among others, in
choosing companies:

. a stable or improving earnings record;

. sound finances;

. above-average growth prospects;

. participation in a fast growing industry;

. strategic niche position in a specialized market; and

. adequate capitalization.

The Fund may also invest in foreign securities and enter into futures and
options on futures contracts.

Principal Risks

Among the principal risks of investing in the Fund are market risk and medium-
size company stock risk. To the extent that the Fund purchases foreign
securities, it may be subject to foreign securities risk. To the extent that
the Fund enters into futures and options on futures contracts, it may be subject
to derivatives risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (8/18/95)
----------------- -------------------
Class Y
[Index]

15
<PAGE>

Framlington Emerging Markets Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

A company will be considered to be in an emerging market country if:

. the company is organized under the laws of, or has a principal office in,
an emerging market country;

. the company's stock is traded primarily in an emerging market country;

. most of the company's assets are in an emerging market country; or

. most of the company's revenues or profits come from goods produced or sold,
investments made or services performed in an emerging market country.

The Fund may also invest in foreign securities of companies located in countries
with mature markets.

Principal Risks

Among the principal risks of investing in the Fund are market risk, foreign
securities risk, emerging markets risk, currency risk and medium-size company
stock risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (12/31/96)
------------ ----------------------
Class Y
[Index]

16
<PAGE>

Framlington Global Financial Services Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

Examples of companies in the financial services industry are:

. commercial, industrial and investment banks;

. savings and loan associations;

. brokerage companies;

. consumer and industrial finance companies;

. real estate and leasing companies;

. insurance companies; and

. holding companies for each of the above.

The sub-advisor allocates assets among countries based on:

. its analysis of the trends in the financial services industry in particular
regions;

. the relative valuation of financial services companies in different
regions; and

. its assessment of the prospects for a particular equity market and its
currency.

The Fund may also enter into forward currency exchange contracts.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

17
<PAGE>

Framlington Healthcare Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund will invest in:

The Fund's investments may include foreign securities of companies located in
countries with mature markets.

Principal Risks

Among the principal risks of investing in the Fund are market risk, sector risk,
foreign securities risk, currency risk and medium-size company stock risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

_______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (12/31/96)
---------- -----------------------
Class Y
[Index]

18
<PAGE>

Framlington International Growth Fund

Goal

The Fund's goal is to provide long-term capital appreciation.

Principal Investment Strategies

The Fund pursues its goal by investing at least 65% of its assets in equity
securities of issuers located in at least three foreign countries.

The sub-advisor will choose companies that demonstrate:

. above-average profitability;
. high quality management; and
. the ability to grow significantly in their countries.

The Fund may invest in companies located in countries with mature markets and in
those with emerging markets. The Fund may also enter into forward currency
exchange contracts.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

Calendar Year Total Return

1997: _____%
1998: _____%

_______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (12/31/96)
------------- ---------------------
Class Y
[Index]

19
<PAGE>

Income Funds

Bond Fund

Goal

The Fund's primary goal is to provide a high level of current income. Its
secondary goal is capital appreciation.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its total assets in a broad range of bonds and other fixed income
securities. These may include:

The Fund's dollar-weighted average maturity will generally range between six and
fifteen years.

The Fund will purchase only fixed income securities that are rated investment
grade or better, or if unrated, are of comparable quality.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may be
subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

____________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (12/1/91)
------------- ----------- -------------
Class Y
[Index]

20
<PAGE>

Intermediate Bond Fund

Goal

The Fund's goal is to provide a competitive rate of return which, over time,
exceeds the rate of inflation and the return provided by money market
instruments.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its total assets in a broad range of bonds and other fixed income
securities. These may include:

The Fund's dollar-weighted average maturity will generally range between three
and eight years.

The Fund will purchase only fixed income securities that are rated investment
grade or better, or if unrated, are of comparable quality.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may be
subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1992: ______%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
1 5 Inception
Year Years (12/1/91)
-------- --------- -----------
Class Y
[Index]

21
<PAGE>

International Bond Fund

Goal

The Fund's goal is to realize a competitive total return through a combination
of current income and capital appreciation.

Principal Investment Strategies

. obligations issued by foreign governments, their agencies, instrumentalities
or political subdivisions;
. obligations issued or guaranteed by supranational organizations (such as the
World Bank);
. obligations of foreign banks or bank holding companies; and
. obligations of foreign corporations.

The Fund will invest in the securities of issuers in at least three foreign
countries.

The Fund's dollar-weighted average maturity will generally range between three
and fifteen years.

The Fund may invest a portion of its assets in domestic obligations, including
U.S. Government securities and obligations of domestic banks and corporations.

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may enter into forward currency exchange contracts.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (10/2/96)
--------- ------------------------
Class Y
[Index]

22
<PAGE>

U.S. Government Income Fund

Goal

The Fund's goal is to provide high current income.

Principal Investment Strategies

The Fund's dollar-weighted average maturity generally will range between six and
fifteen years.

The Fund may also invest in other fixed income securities.

Principal Risks

The principal risk of investing in the Fund is interest rate risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" on "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1995: _____%
1996: _____%
1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (7/5/94)
---------- ---------------
Class Y
[Index]

23
<PAGE>

Short Term Treasury Fund

Goal

The Fund's goal is to provide investors with an enhanced money market return
consistent with capital preservation.

Principal Investment Strategies

The Fund pursues its goal by investing all of its assets in U.S. Treasury
securities and in repurchase agreements fully collateralized by U.S. Treasury
securities.

The Fund's dollar-weighted average portfolio maturity usually will not exceed
two years.

The Fund seeks to generate a total return which exceeds the return of money
market instruments while minimizing the fluctuation of its net asset value. The
Fund, however, is not a money market fund and its net asset value may fluctuate.

Principal Risks

The principal risk of investing in the Fund is interest rate risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1998: _____%

____________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year (1/29/97)
------------ ------------------
Class Y
[Index]

24
<PAGE>

- --------------------------------
Tax-Free Funds
- --------------------------------

Michigan Tax-Free Bond Fund
(Offered only in the State of Michigan)

Goal

Principal Investment Strategies

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk,
credit risk, and non-diversified risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

[1994: _____%]
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (1/3/94)
------------ ------------- ----------------
Class Y
[Index]

25
<PAGE>

Tax-Free Bond Fund

Goal

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its net assets in municipal obligations.

In selecting securities for the Fund, the advisor places a premium on value and
diversifies the Fund's portfolio holdings across maturities, industries and
geographic locations.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1995: _____%
1996: _____%
1997: _____%
1998: _____%

__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since Inception
1 Year (7/21/94)
------------- -------------------
Class Y
[Index]

26
<PAGE>

Tax-Free Short-Intermediate Bond Fund

Goal

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its net assets in municipal obligations.

Under normal market conditions, at least 80% of the Fund's net assets will be
invested in municipal obligations whose interest is exempt from regular Federal
income tax.

The Fund generally buys obligations with remaining maturities of five years or
less. The Fund's dollar-weighted average maturity will generally range between
two and five years.

The Fund may invest more than 25% of its assets in municipal obligations issued
by the State of Michigan and its political subdivisions.

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are market risk, interest
rate risk, credit risk and non-diversified risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

Calendar Year Total Return

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (12/17/92)
-------------- ------------- ---------------
Class Y
[Index]

27
<PAGE>

- -----------------------------
Money Market Funds
- -----------------------------

Cash Investment Fund

Goal

The Fund's primary goal is to provide as high a level of current interest income
as is consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing in a broad range of U.S. dollar-
denominated money market instruments.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

The Fund's investments may include fixed and variable rate securities.

The Fund may also invest in foreign securities.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may
be subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1991: _____%
1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (3/14/90)
-------------- ------------- ---------------
Class Y
[Index]

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

28
<PAGE>

Money Market Fund

Goal

The Fund's primary goal is to provide as high a level of current interest income
as is consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing in a broad range of U.S. dollar-
denominated money market instruments.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

The Fund's investments may include fixed and variable rate securities.

The Fund may also invest in foreign securities..

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may
be subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

Calendar Year Total Return

1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)
Since
Inception
1 Year 5 Years (8/18/93)
-------------- ------------- ---------------
Class Y
[Index]

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

29
<PAGE>

Tax-Free Money Market fund

Goal

The Fund's goal is to provide as high a level of current interest income exempt
from Federal income taxes as is consistent with maintaining liquidity and
stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing substantially all of its assets in short-
term, U.S. dollar-denominated municipal obligations, the interest on which is
exempt from regular Federal income tax.

Under normal market conditions, the Fund will invest at least 80% of its net
assets in municipal obligations.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

Principal Risks

Although the Fund seeks to preserve the value of our investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

Among the principal risks of investing in the Fund are interest rate risk and
credit risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return

1991: _____%
1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Inception
1 Year 5 Years (3/14/90)
-------------- ------------- ---------------
Class Y
[Index]

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

30
<PAGE>

U.S. Treasury Money Market Fund

Goal

The Fund's goal is to provide as high a level of current interest income as is
consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

Among the principal risks of investing in the Fund is interest rate risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

Calendar Year Total Return

1991: _____%
1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)
Since
Inception
1 Year 5 Years (3/14/90)
-------------- ------------- ---------------
Class Y
[Index]

[You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

31
<PAGE>

Summary of Principal Risks of The Funds

The share price of the Funds will change daily based on market conditions and
other factors. Therefore, you may lose money if you invest in the Funds.

SECTOR RISK is the risk of loss due to concentrating investments in a particular
industry sector. Adverse economic, business or political developments affecting
that industry sector could have a major effect on the value of the Fund's
investments. Real Estate Equity Investment Fund, Global Financial Services
Fund, Healthcare Fund and NetNet Fund are particularly subject to this Risk.

CREDIT (OR DEFAULT) RISK is the risk of loss because an issuer of a security may
default on its payment obligations. Also, an issuer may suffer adverse changes
in its financial condition that could lower the credit quality of a security,
leading to greater volatility in the price of the security and in shares of the
Fund. A change in the quality rating of a bond can affect the bond's liquidity
and make it more difficult for the Fund to sell. Funds particularly subject to
this risk are: Balanced Fund, Growth & Income Fund, Bond Fund, Intermediate
Bond Fund, International Bond Fund, U.S. Government Income Fund, Michigan Tax-
Free Bond Fund, Tax-Free Bond Fund, Tax-Free Short-Intermediate Bond Fund, Cash
Investment Fund, Money Market Fund and Tax-Free Money Market Fund.

DERIVATIVES RISK is the risk that loss may result from a Fund's use of futures
and options on futures contracts, options, forward currency exchange contracts
and other forms of derivative instruments. The primary risk with many
derivatives is that they can amplify a gain or loss, potentially earning or
losing substantially more money than the actual cost of the derivative
instrument. Funds particularly subject to this risk are: Balanced Fund,
International Equity Fund, Value Fund, Small-Cap Value Fund, NetNet Fund, Global
Financial Services Fund, International Growth Fund and International Bond Fund.

FOREIGN SECURITIES RISK is the risk of loss because investments by a Fund in
foreign securities may experience greater and more rapid change in value than
investments in U.S. securities. Foreign securities are generally more volatile
and less liquid than U.S. securities, in part because of greater political and
economic risks and because there is less public information available about
foreign companies. Issuers of foreign securities are generally not subject to
the same degree of regulation as are U.S. issuers. The reporting, accounting
and auditing standards of foreign countries may differ, in some cases
significantly, from U.S. standards. Funds particularly subject to this risk
are: Balanced Fund, Equity Selection Fund, Growth & Income Fund, Growth
Opportunities Fund, International Equity Fund, Micro-Cap Equity Fund, NetNet
Fund, Value Fund, Small-Cap Value Fund, Small Company Growth Fund, Multi-Season
Growth Fund, Emerging Markets Fund, Global Financial Services Fund, Healthcare
Fund, International Growth Fund, Bond Fund, Intermediate Bond Fund,
International Bond Fund, Cash Investment Fund and Money Market Fund.

Currency Risk. Funds that invest in foreign securities denominated in
foreign currencies may also be subject to currency risk. This is the risk
of loss because a decline in the value of foreign currencies relative to
the U.S. dollar will reduce the value of a Fund's portfolio securities
denominated in those currencies. Funds particularly subject to this risk
are: International Equity Fund, Emerging Markets Fund, Global Financial
Services Fund, Healthcare Fund, International Growth Fund and International
Bond Fund.

Emerging Markets Risk. Funds that invest in foreign securities of issuers
in emerging market countries are subject to emerging markets risk.
Investing in emerging market countries heightens the risks presented by
investing in foreign securities and currencies and may result in loss to
the Fund. Numerous emerging countries have recently experienced serious,
and potentially continuing, economic and political problems. Stock markets
in many emerging countries are relatively small and risky. Foreigners are
often limited in their ability to invest in, and withdraw assets from,
these markets. Additional restrictions may be

32
<PAGE>

imposed under emergency conditions. Funds particularly subject to this risk
are: International Equity Fund, Emerging Markets Fund and International
Growth Fund.

INTEREST RATE RISK is the risk of loss because increases in prevailing interest
rates will cause fixed-income securities held by a Fund to decline in value.
Longer term bonds are generally more sensitive to interest rate changes than
shorter term bonds. Generally, the longer the average maturity of the bonds
held by the Fund, the more the Fund's share price will fluctuate in response to
interest rate changes. Funds particularly subject to this risk are: Balanced
Fund, Growth & Income Fund, Bond Fund, Intermediate Bond Fund, International
Bond Fund, Short-Term Treasury Fund, U.S. Government Income Fund, Michigan Tax-
Free Bond Fund, Tax-Free Short-Intermediate Bond Fund, Cash Investment Fund,
Money Market Fund, Tax-Free Money Market Fund and U.S. Treasury Money Market
Fund.

MARKET RISK is the risk of loss because the value of the securities in which a
Fund invests decline in response to general economic conditions. Price changes
may be temporary or last for extended periods. For example, stock prices have
historically risen and fallen in periodic cycles. In addition, the value of a
Fund's investments may decline if the particular Companies the Fund invests in
do not perform well. All of the Munder Equity Funds are subject to this risk.

MEDIUM-SIZE COMPANY STOCK RISK is the risk of loss because the stocks of medium-
size companies may be more susceptible to market downturns, and their prices may
be more volatile than the stocks of larger companies. Equity Selection Fund,
Growth Opportunities Fund, NetNet Fund, Value Fund, Emerging Markets Fund,
Global Financial Services Fund, International Growth Fund and Healthcare Fund
are particularly subject to this risk.

NON-DIVERSIFIED RISK is the risk of loss because a Fund that invests more of its
assets in fewer issuers than many other funds do, may be more susceptible to
adverse developments affecting any single issuer, and more susceptible to
greater losses because of these developments. For example, the Michigan Tax-
Free Bond Fund invests primarily in Michigan municipal obligations, if Michigan
issuers suffer serious financial difficulties, jeopardizing their ability to pay
their obligations, the Fund may suffer a loss. International Bond Fund,
Michigan Tax-Free Bond Fund and Tax-Free Short-Intermediate Bond Fund are
subject to this risk.

PREPAYMENT RISK is the risk that a Fund may experience losses when an issuer
exercises its right to pay principal on an obligation held by the Fund (such as
a mortgage-backed security) earlier than expected. This may happen during a
period of declining interest rates. Under these circumstances, the Fund may be
unable to recoup all of its initial investment and will suffer from having to
reinvest in lower yielding securities. The loss of higher yielding securities
and the reinvestment at lower interest rates can reduce the Fund's income, total
return and share price. Funds particularly subject to this risk are: Balanced
Fund, Bond Fund, Intermediate Bond Fund, U.S. Government Income Fund, Cash
Investment Fund and Money Market Fund.

SMALL COMPANY STOCK RISK is the risk of loss because the stocks of small
companies may have more risks than those of larger companies. Small companies
often have narrower markets and more limited managerial and financial resources
than larger, more established companies. As a result, they may be more
sensitive to changing economic conditions, which could increase the volatility
of a Fund's portfolio. In addition, small company stocks typically are traded
in lower volume making them more difficult to sell. Funds particularly subject
to this risk are: Micro-Cap Equity Fund, Small Cap Value Fund, Small Company
Growth Fund, NetNet Fund and Healthcare Fund.

33
<PAGE>

Who May Want To Invest

The Equity Funds may be appropriate for investors:

. Looking to invest over the long term and willing to ride out market swings
in search of potentially higher returns.

. Looking for an investment that has more return and risk potential than
fixed income investments.

The Income Funds may be appropriate for investors:

. Looking for potentially higher returns and willing to accept greater risk
than more conservative fixed rate investments or money market funds.

. Looking for current income.

The Tax-Free Funds may be appropriate for investors:

. Looking primarily for tax-exempt income.

. Comfortable with the risks involved with fixed income investments.

The Money Market Funds may be appropriate for investors:

. Looking for a high level of income and liquidity and stability of
principal.

34
<PAGE>

Fees And Expenses
The tables below describe the fees and expenses that you may pay if you buy and
hold Class Y shares the Funds. Please note that the following information does
not include fees that institutions may charge for services they provide to you.

Shareholder Fees (fees paid directly from your investment)
Maximum Sales Charge (Load) Imposed on Purchases......................... None
Sales Charge (Load) Imposed on Reinvested Dividends...................... None
Maximum Deferred Sales Charge (Load)..................................... None
Redemption Fees.......................................................... None
Exchange Fees............................................................ None

Annual Fund Operating Expenses (expenses that are paid from Fund assets) And
Examples

The examples are intended to help you compare the cost of investing in each Fund
to the cost of investing in other mutual funds. The examples assume that you
invest $10,000 in the Fund for the time periods indicated. The examples also
assume that your investment has a 5% return each year, that the Funds operating
expenses remain the same as shown in the table and that all dividends and
distributions are reinvested. Your actual costs may be higher or lower.

Management Fees .65% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses .[ ]% 10 Years $
=====

Equity Selection Fund

Management Fees .75% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
=====

Growth & Income Fund

Management Fees .75% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses .[ ]% 10 Years $
=====

Growth Opportunities Fund

Management Fees .75% 1 Year $
Other Expenses(2) [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
=====
</TABLE>

35
<PAGE>

Management Fees .75% 1 Year $
Other Expenses .25% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses 1.00% 10 Years $
=====

Micro-Cap Equity Fund

Management Fees 1.00% 1 Year $
Other Expenses(2) [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
=====

Multi-Season Growth Fund

Management Fees(1) [ ]% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
=====

NetNet Fund

Management Fees 1.00% 1 Year $
Other Expenses(2) [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
=====

Real Estate Equity Investment Fund

Management Fees .74% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
=====

Small-Cap Value Fund

Management Fees .75% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
=====

Small Company Growth Fund

Management Fees .75% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses .[ ]% 10 Years $
=====
</TABLE>

36
<PAGE>

Management Fees .74% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
=====

Framlington Emerging Markets Fund

Management Fees 1.25% 1 Year $
Other Expenses(2) [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
=====

Framlington Global Financial Services Fund

Management Fees .75% 1 Year $
Other Expenses(2) [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
=====

Framlington Healthcare Fund

Management Fees 1.00% 1 Year $
Other Expenses(2) [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
=====

Framlington International Growth Fund

Management Fees 1.00% 1 Year $
Other Expenses(2) [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
=====

Bond Fund

Management Fees .50% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
=====

Intermediate Bond Fund

Management Fees .50% 1 Year $
Other Expenses [ ]% 3 Years $
-----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
=====
</TABLE>

37
<PAGE>

Management Fees .50% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====

U.S. Government Income Fund

Management Fees .50% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====

Short Term Treasury Fund

Management Fees .25% 1 Year $
Other Expenses(2) [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses(3) [ ]% 10 Years $
====

Michigan Tax-Free Bond Fund

Management Fees .50% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====

Tax-Free Bond Fund

Management Fees .50% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====

Tax-Free Short-Intermediate Bond Fund

Management Fees .50% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====

Cash Investment Fund

Management Fees .35% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====
</TABLE>

38
<PAGE>

Management Fees .40% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====

Tax-Free Money Market Fund

Management Fees .35% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====

U.S. Treasury Money Market Fund

Management Fees .35% 1 Year $
Other Expenses [ ]% 3 Years $
----
Total Annual Fund Operating 5 Years $
Expenses [ ]% 10 Years $
====
</TABLE>

_______________________________________________________
(1) For the fiscal year ended June 30, 1999, the advisor voluntarily waived a
portion of its management fees. As a result of the fee waiver, actual
management fees paid by the Multi-Season Growth Fund were [ ]% of its
average daily net assets.

(2) For the fiscal year ended June 30, 1999, the advisor voluntarily reimbursed
certain operating expenses. As a result of the expense reimbursement,
actual Other Expenses paid by the Funds, were:

<TABLE>
<CAPTION>
Fund Other Operating Expenses
----
(as a % of average daily net assets)
------------------------------------
<S> <C>
Growth Opportunities Fund %
Micro-Cap Equity Fund %
NetNet Fund %
Framlington Emerging Markets Fund %
Framlington Global Financial Services Fund %
Framlington Healthcare Fund %
Framlington International Growth Fund %
Short Term Treasury Fund %
</TABLE>

<TABLE>
<CAPTION>
Fund Total Annual Fund Operating Expenses
----
(as a % of average daily net assets)
-----------------------------------
<S> <C>
Growth Opportunities Fund %
Multi-Season Growth Fund %
Micro-Cap Equity Fund %
NetNet Fund %
Framlington Emerging Markets Fund %
Framlington Global Financial Services Fund %
Framlington Healthcare Fund %
Framlington International Growth Fund %
Short Term Treasury Fund %
</TABLE>

39
<PAGE>

More About The Funds
- -------------------------------------------------------------------------------

The Funds' principal investment strategies and risks are summarized above in the
section entitled Risk/Return Summary. A more complete description of each Funds
investments and strategies and their associated risks is provided below under
"Special Risks and Other Considerations" and "Additional Descriptions of
Investments and Investment Strategies." The Funds may also invest in other
securities and are subject to further restrictions and risks which are described
in the Statement of Additional Information. The Glossary below explains certain
terms used throughout this prospectus.

Glossary

Types Of Funds

Equity Funds are the Balanced Fund, Equity Selection Fund, Growth & Income Fund,
Growth Opportunities Fund, International Equity Fund, Micro-Cap Equity Fund,
Multi-Season Growth Fund, NetNet Fund, Real Estate Equity Investment Fund,
Small-Cap Value Fund, Small Company Growth Fund, Value Fund, Framlington
Emerging Markets Fund, Framlington Global Financial Services Fund, Framlington
Health Care Fund and Framlington International Growth Fund.

Income Funds are the Bond Fund, Intermediate Bond Fund, International Bond Fund,
U.S. Government Income Fund and Short Term Treasury Fund.

Tax-Free Funds are the Michigan Tax-Free Bond Fund, Tax-Free Bond Fund and Tax-
Free Short-Intermediate Bond Fund.

Money Market Funds are the Cash Investment Fund, Money Market, Tax-Free Money
Market Fund and U.S. Treasury Money Market Fund.

Types Of Securities

Rating Agencies and Indices

Moody's is Moody's Investor Services, Inc.

Duff & Phelps is Duff & Phelps Credit Rating Co.

Fitch is Fitch IBCA, Inc.

S&P is Standard & Poor's Rating Services.

40
<PAGE>

S&P 500 is S&P's 500 Composite Stock Price Index, a widely recognized unmanaged
index U.S. stock market activity.

Other

1940 Act is the Investment Company Act of 1940, as amended.

Internal Revenue Code is the Internal Revenue Code of 1986, as amended.

NAV is the net asset value per share of a Fund.

Special Risks And Other Considerations

Investment Strategy. All Funds (except the Short Term Treasury Fund and the
U.S. Treasury Money Market Fund) may use derivative instruments.
Derivatives can be used for hedging (attempting to reduce risk by
offsetting one investment position with another) or speculation (taking a
position in the hope of increasing return). The Funds may, but are not
required to, use derivatives for hedging purposes or for the purpose of
remaining fully invested or maintaining liquidity. The Funds will not use
derivatives for speculative purposes.

Special Risks. The use of derivative instruments exposes a Fund to
additional risks and transaction costs. Risks of derivative instruments
include: (1) the risk that interest rates, securities prices and currency
markets will not move in the direction that a portfolio manager
anticipates; (2) imperfect correlation between the price of derivative
instruments and movements in the prices of the securities, interest rates
or currencies being hedged; (3) the fact that skills needed to use these
strategies are different than those needed to select portfolio securities;
(4) the possible absence of a liquid secondary market for any particular
instrument and possible exchange imposed price fluctuation limits, either
of which may make it difficult or impossible to close out a position when
desired; (5) the risk that adverse price movements in an instrument can
result in a loss substantially greater than the Fund's initial investment
in that instrument (in some cases, the potential loss is unlimited); (6)
particularly in the case of privately-

41
<PAGE>

negotiated instruments, the risk that the counterparty will not perform its
obligations, which could leave the Fund worse off than if it had not
entered into the position; and (7) the inability to close out certain
hedged positions to avoid adverse tax consequences.

Foreign Investment Risk. Foreign securities include direct investments in non-
U.S. dollar-denominated securities traded outside of the United States and
dollar-denominated securities of foreign issuers traded in the United States.
Foreign securities also include indirect investments such as American Depository
Receipts ("ADRs"), European Depository Receipts ("EDRs") and Global Depository
Receipts ("GDRs"). ADRs are U.S. dollar-denominated receipts representing shares
of foreign-based corporations. ADRs are issued by U.S. banks or trust companies,
and entitle the holder to all dividends and capital gains that are paid out on
the underlying foreign shares. EDRs and GDRs are receipts issued by non-U.S.
financial institutions that often trade on foreign exchanges. They represent
ownership in an underlying foreign or U.S. security and are generally
denominated in a foreign currency.

Investment Strategy. International Equity Fund, International Growth Fund,
Framlington Global Financial Services Fund, Framlington Healthcare Fund
Framlington International Growth Fund and International Bond Fund will
invest all or a substantial portion of their total assets in foreign
securities. The other Equity Funds (except Real Estate Investment Fund),
the Income Funds (except Short-Term Treasury Fund), Cash Investment Fund
and Money Market Fund may invest up to 25% of their total assets in foreign
securities. The Tax - Free Funds may invest up to 10% of their total assets
in foreign securities.

Special Risks. Foreign securities involve special risks and costs.
Investment in the securities of foreign governments involves the risk that
foreign governments may default on their obligations or may otherwise not
respect the integrity of their debt.

Investment in foreign securities may involve higher costs than investment
in U.S. securities, including higher transaction and custody costs as well
as the imposition of additional taxes by foreign governments. Foreign
investments may also involve risks associated with the level of currency
exchange rates, less complete financial information about the issuers, less
market liquidity, more market volatility and political instability. Future
political and economic developments, the possible imposition of withholding
taxes on dividend income, the possible seizure or nationalization of
foreign holdings, the possible establishment of exchange controls or
freezes on the convertibility of currency, or the adoption of other
governmental restrictions might adversely affect an investment in foreign
securities. Additionally, foreign issuers may be subject to less stringent
regulation, and to different accounting, auditing and recordkeeping
requirements.

Currency exchange rates may fluctuate significantly over short periods of
time causing a Fund's net asset value to fluctuate as well. A decline in
the value of a foreign currency relative to the U.S. dollar will reduce the
value of a foreign currency-denominated security. To the extent that a Fund
is invested in foreign securities while also maintaining currency
positions, it may be exposed to greater combined risk. The Funds'
respective net currency positions may expose them to risks independent of
their securities positions.

Additional risks are involved when investing in countries with emerging
economies or securities markets. In general, the securities markets of
these countries are less liquid, are subject to greater price volatility,
have smaller market capitalizations and may have problems with securities
registration and custody. In addition, because the securities settlement
procedures are less developed in these countries, a Fund may be required to
deliver securities before receiving payment and may also be unable to
complete transactions during market disruptions. As a result of these and
other risks, investments in these countries generally present a greater
risk of loss to the Fund.

A further risk of investing in foreign securities is the risk that a Fund
may be adversely affected by the conversion of

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<PAGE>

certain European currencies into the Euro. This conversion, which is under
way, is scheduled to be completed in the year 2002. However, problems with
the conversion process and delays could increase volatility in world
markets and affect European markets in particular.

Investments in Internet Related Companies by the NetNet Fund. The Fund will
invest primarily in companies engaged in Internet and Intranet related
activities. The value of such companies is particularly vulnerable to rapidly
changing technology, (extensive government regulation) and relatively high risks
of obsolescence caused by scientific and technological advances. The value of
the Fund's shares may fluctuate more than shares of a fund investing in a
broader range of industries.

Investment Grade Credit Risk. A security is considered investment grade if, at
the time of purchase, it is rated:

. BBB or higher by S&P;
. Baa or higher by Moody's;
. BBB or higher by Duff & Phelps; or
. BBB or higher by Fitch.

A security will be considered investment grade if it receives one of the above
ratings, even if it receives a lower rating from other rating organizations.

Investment Strategy. Except as stated in the next section, fixed income and
convertible securities purchased by the Funds will generally be rated at
least investment grade. The Funds may also invest in unrated securities if
the advisor or sub-advisor believes they are comparable in quality.

Special Risks. Although securities rated "BBB" by S&P, Duff & Phelps or
Fitch, or Baa by Moody's are considered investment grade, they have certain
speculative characteristics. Therefore, they may be subject to a higher
risk of default than obligations with higher ratings. Subsequent to its
purchase by a Fund, a rated security may cease to be rated or its rating
may be reduced below the minimum rating required for purchase by the Fund.
The advisor or sub-advisor will consider such an event in determining
whether the Fund should continue to hold the security.

Non-Investment Grade Credit Risk. Non-investment grade fixed income and
convertible securities are generally rated "BB" or below by S&P, Duff & Phelps
or Fitch, or "Ba" by Moody's.

Investment Strategy. All Equity Funds may invest a portion of their total
assets in non-investment grade securities when the advisor or sub-advisor
determines that such securities are desirable in light of the Funds'
investment objectives and portfolio mix.

Special Risks. Non-investment grade securities (sometimes referred to as
"junk bonds") are subject to greater risk than investment grade securities.
They generally present a higher degree of credits risks (default). In
addition, the market value of these securities tends to be more sensitive
to individual corporate developments and to changes in interest rates and
other economic developments than higher-rated securities

43
<PAGE>

Short-Term Trading. The Funds' historical portfolio turnover rates are shown in
the Financial Highlights.

Investment Strategy. Some Funds may engage in short-term trading,
including, in the case of the Equity Funds, initial public offerings.

Special Risks. A high rate of portfolio turnover (100% or more) could
produce higher trading costs and taxable distributions, which could detract
from a Fund's performance.

Defensive Investing. Each Fund may invest all or any portion of its assets in
short-term obligations as a temporary defensive measure in response to adverse
market or economic conditions.

Special Risks. A Fund may not achieve its investment objective when its
assets are invested in short-term obligations.

Additional Description of Investments And Investment Strategies

Investment Strategy. All Income Funds (except Short Term Treasury Fund),
Balanced Fund, Framlington Global Financial Services Funds, Money Market
Fund and Cash Investment Fund may invest a portion of its assets in Asset-
Backed Securities.

Special Risks. In addition to credit and market risk, asset-backed
securities involve repayment risk because the underlying assets (loans) may
be prepaid at any time. The value of these securities may also change
because of actual or perceived changes in the creditworthiness of the
originator, the servicing agent, the financial institution providing the
credit support, or the counterparty. Like other fixed income securities,
when interest rates rise the value of an asset-backed security generally
will decline. However, when interest rates decline, the value of an asset-
backed security with prepayment features may not increase as much as that
of other fixed income securities. In addition, non-mortgage asset-backed
securities involve certain risks not presented by mortgage-backed
securities. Primarily, these securities do not have the benefit of the same
security interest in the underlying collateral.

Investment Strategy. Each Fund may borrow money in an amount up to 5% of
its assets for temporary emergency purposes and in an amount up to 33 1/3%
of its assets to meet redemptions. This is a fundamental policy which can
be changed only by shareholders.

Special Risks. Borrowings and reverse repurchase agreements by a Fund may

44
<PAGE>

involve leveraging. If the securities held by the Fund decline in value
while these transactions are outstanding, the Fund's net asset value will
decline in value by proportionately more than the decline in value of the
securities. In addition, reverse repurchase agreements involve the risks
that the interest income earned by the Fund (from the investment of the
proceeds) will be less than the interest expense of the transaction, that
the market value of the securities sold by the Fund will decline below the
price the Fund is obligated to pay to repurchase the securities, and that
the securities may not be returned to the Fund.

Credit Quality of the Tax-Free Funds. The Tax-Free Funds will invest in long-
term instruments only if they are rated "A" or better by Moody's or S&P or, if
unrated, are of comparable quality. These Funds will invest in short-term
instruments only if they (i) have short-term debt ratings in the top two
categories by at least one nationally recognized statistical rating
organization, (ii) are issued by an issuer with such ratings or (iii) if
unrated, are of comparable quality.

Forward Currency Exchange Contracts. A forward currency exchange contract is an
obligation to exchange one currency for another on a future date at a specified
exchange rate.

Investment Strategy. Forward currency exchange contracts may be used for
hedging purposes and to help reduce the risks and volatility caused by
changes in foreign currency exchange rates. Foreign currency exchange
contracts will be used at the discretion of the advisor or sub-advisor, and
no Fund is required to hedge its foreign currency positions.

Investment Strategy. The Equity Funds the Income Funds (except Short Term
Treasury Fund) and the Tax-Free Funds may invest in futures contracts and
options on futures contracts on domestic or foreign exchanges or boards of
trade. These instruments may be used for hedging purposes, to maintain
liquidity to meet potential shareholder redemptions, to invest cash
balances or dividends, or to minimize trading costs.

Special Risks. Futures contracts and related options present the following
risks: imperfect correlation between the change in market value of a Fund's
securities and the price of futures contracts and options; the possible
inability to close a futures contract when desired; losses due to
unanticipated market movements, which are potentially unlimited; and the
possible inability of the advisor or sub-advisor to correctly predict the
direction of securities prices, interest rates, currency exchange rates and
other economic factors.

Investment Strategy. The Income Funds (except Short Term Treasury Fund),
Cash Investment Fund and Money Market Fund may invest in guaranteed
investment contracts.

Special Risks. Guaranteed investment contracts are considered illiquid
investments and are acquired subject to a Fund's limitation on illiquid
investments.

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<PAGE>

Investment Strategy. Each Fund may invest up to 15% (10% in the case of a
Money Market Fund) of its net assets in securities that are illiquid.

Special Risks. To the extent that a Fund invests in illiquid securities,
the Fund risks not being able to sell the securities at the time and the
price that it would like. The Fund may have to lower the price, sell
substitute securities or forego an investment opportunity, each of which
may cause a loss to the Fund.

Investment Companies. To the extent consistent with their respective investment
objectives and policies, the Funds (other than Short-Term Treasury Fund and U.S.
Treasury Money Market Fund) may invest in securities issued by other investment
companies.

Investment Strategy. Investments by a Fund in other investment companies
will be subject to the limitations of the 1940 Act.

Special Risks. As a shareholder of another investment company, a Fund would
be subject to the same risks as any other investor in that company. In
addition, it would bear a proportionate share of any fees and expenses paid
by that company. These would be in addition to the advisory and other fees
paid directly by the Fund.

Investment Strategy. The Tax-Free Funds and Tax-Free Money Market Fund will
normally invest at least 80% of their net assets in municipal obligations.

Special Risks. Industrial revenue bonds depend on the credit standing of a
private issuer and may be subject to the federal alternative minimum tax
(AMT). Although Tax-Free Money Market Fund may invest more than 25% of its
net assets in municipal revenue obligations, it does not intend to do so on
a regular basis. If it does, it will be riskier than a fund which does not
concentrate to such an extent on similar projects.

Investment Strategy. The Equity Funds, Income Funds (except Short Term
Treasury Fund), Tax-Free Free Bond Fund and Michigan Tax-Free Bond Fund may
write (sell) covered call options, buy put options, buy call options and
write secured put options for hedging purposes. Options may relate to
particular securities, foreign or domestic securities indices, financial
instruments or foreign currencies.

Special Risks. The value of options can be highly volatile, and their use
can result in loss if the advisor or sub-advisor is incorrect in its
expectation of price fluctuations. The successful use of options for
hedging purposes also depends in part on the ability of the advisor or sub-
advisor to predict future price fluctuations and the degree of correlation
between the options and securities markets.

Repurchase Agreements. Repurchase agreements involve the purchase of securities
by a Fund subject to the seller's agreement to repurchase them at a mutually
agreed upon date and price.

Investment Strategy. Each Fund may enter into repurchase agreements with
banks and broker-dealers that are deemed to be creditworthy by the advisor
or sub-advisor.

Special Risks. If the seller defaults or declares bankruptcy, a Fund may
suffer if the proceeds from the sale of the underlying securities and other
collateral are less than the repurchase price or if there are delays in
selling the underlying securities or collateral.

Securities Lending. In order to generate additional income, each Fund may lend
securities on a short-

46
<PAGE>

term basis to qualified institutions. By reinvesting any cash collateral it
receives in these transactions, the Fund could realize additional income gains
or losses.

Investment Strategy. Securities lending may represent no more than 25% of
the value of a Fund's total assets (including the loan collateral).

Special Risks. The main risk when lending Fund securities is that if the
borrower fails to return the securities or the invested collateral has
declined in value, the Fund could lose money.

Investment Strategy. Each Fund may invest a portion of its assets in short-
term obligations pending investment or to meet anticipated redemption
requests. The Tax-Free Funds and Tax-Free Money Market Fund may hold
uninvested cash if, in the advisor's opinion, suitable tax-exempt
securities are not available. Each Tax-Free Fund may also invest a portion
of its assets in short-term money market instruments, the income from which
is subject to Federal income tax.

Special Risks. A Fund may not achieve its investment objective when its
asset are invested in short-term obligations.

Special Risks. Purchasing or selling securities on a when-issued, delayed
delivery or forward commitment basis involves the risk that the value of
the securities may change by the time they are actually issued or
delivered. These transactions also involve the risk that the seller may
fail to deliver the security or cash on the settlement date.

Zero Coupon Bonds. These are securities issued at a discount from their face
value because interest payments are typically postponed until maturity.

47
<PAGE>

similar maturities and credit quality. A Fund's investments in zero coupon
bonds may require the Fund to sell some of its portfolio securities to
generate sufficient cash to satisfy certain income distribution
requirements.

48
<PAGE>

Your Investment
- --------------------------------------------------------------------------------

This section describes how to do business with the Funds.

How To Reach The Funds

By telephone: 1-800-438-5789
Call for account information.

By mail: The Munder Funds
480 Pierce Street
Birmingham, MI 48009

Purchasing Shares

Who May Purchase Shares
The following persons may purchase shares of the Funds:

. fiduciary and discretionary accounts of institutions;

. 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 for their own
accounts or for the accounts of their clients);
. directors, trustees, officers and employees of the Munder Funds, the
advisor and the Funds' distributor;
. the advisor's investment advisory clients; and
. family members of employees of the advisor.

Each Fund also issues other classes of shares, which have different sales
charges, expense levels and performance. Call (800) 438-5789 to obtain more
information about the Funds' other classes of shares.

Purchase Price of Shares

Class Y shares of the Funds are sold at the NAV next determined after a purchase
order is received in proper form.

Broker-dealers (other than the Funds' distributor) may charge you a fee for
shares you purchase through them.

Policies for Purchasing Shares

Minimum initial investment

The minimum initial investment by fiduciary and discretionary accounts of
institutions and by institutional investors is $500,000 ($250,000 for the Real
Estate Equity Investment Fund). Other investors are not subject to any minimum.

There is no minimum for subsequent investments.

Timing of orders

Purchase orders must be received by the Funds' distributor or transfer agent
before the close of regular trading on the New York Stock Exchange (normally,
4:00 p.m. Eastern time).

Methods for Purchasing Shares

You can purchase Class Y shares through the Fund's transfer agent or through the
Fund's distributor through arrangements with a broker-dealer or financial
institution.

. Through a Financial Institution. You may purchase shares through a
financial institution through procedures established with that institution.
Confirmations of share purchases will be sent to the institution.

. By Mail. You may open an account directly through the Fund's transfer agent
by completing, signing and mailing an account application form and a check
or other negotiable bank draft (payable to The Munder Funds) to: The Munder
Funds, c/o First Data Investor Services Group, P.O. Box 60428, King of
Prussia, Pennsylvania 19406-0428. You can obtain an account application
form by calling (800) 438-5789. For additional investments, send a letter
stating the Fund and share class you wish to purchase, your name and your
account number with a check for $50 or more to the address listed above.
[We do not generally accept third-party checks.]

. By Wire. You may make additional investments in the Funds by wire. Wire
instructions must state the Fund name, share class, your registered name
and your account number. Your bank wire should be sent through the Federal
Reserve Bank Wire System to:

Boston Safe Deposit and Trust Company
Boston, MA
ABA# 011001234
DDA# 16-798-3

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<PAGE>

Account No.:

Note that banks may charge fees for transmitting wires.

. You may purchase shares through the Automatic Investment Plan.

Exchanging Shares

Policies for Exchanging Shares

. You may exchange your Fund shares for Class Y shares of other Munder Funds
based on their relative net asset values.

. You must meet the minimum purchase requirements for the Munder Fund that
you purchase by exchange.

. A share exchange may be a taxable event and, accordingly, you may realize a
taxable gain or loss.

. Brokers may charge you a fee for handling exchanges.

. We may modify or terminate the exchange privilege at any time. You will be
given notice of any material modifications except where notice is not
required.

[Methods for Exchanging Shares]

Redeeming Shares

Redemption Price

We will redeem shares at the NAV next determined after we receive the redemption
request in proper form.

Methods for Redeeming Shares

. [You may redeem shares of all Funds through your [broker-dealer] or
financial institution.]

. [Others Methods]

. You can redeem a portion of your shares of the Income Funds (other than the
International Bond Fund [and the Short Term Treasury Fund]), the Tax-Free
Funds and the Money Market Funds through the free checkwriting privilege.

Policies for Redeeming Shares

. Shares held by an institution on behalf of its customers must be redeemed
in accordance with instructions and limitations pertaining to the account
at that institution.

Additional Policies For Purchases, Exchanges And Redemptions

. We consider requests to be in "proper form" when all required documents are
properly completed, signed and received.

. If your purchase order and payment for a Money Market Fund is received in
proper form before 2:45 p.m. (Eastern time), you will receive dividends for
that day. If your redemption order is received before 2:45 p.m. (Eastern
time), you will not receive dividends for that day.

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<PAGE>

. The Funds reserve the right to reject any purchase order.

. At any time, the Funds may change any of their purchase, redemption or
exchange practices, and may suspend the sale of their shares.

. The Funds may delay sending redemption proceeds for up to seven days, or
longer if permitted by the Securities and Exchange Commission.

. To limit the Funds' expenses, we do not currently issue share certificates.

. If you are redeeming recently purchased shares, your redemption request may
not be honored until your check or [electronic transaction] has cleared.
This may delay your transaction for up to 15 days.

. A Fund may temporarily stop redeeming shares if:

. the New York Stock Exchange is closed;
. trading on the New York Stock Exchange is restricted;
. an emergency exists and the Fund cannot sell its assets or accurately
determine the value of its assets; or
. the Securities and Exchange Commission orders the Fund to suspend
redemptions.

. If accepted by a Fund, investors may purchase shares of the Fund (other
than the Real Estate Equity Investment Fund) with securities which the Fund
may hold. The advisor will determine if the securities are consistent with
the Funds objectives and policies. If accepted, the securities will be
valued the same way the Fund values portfolio securities it already owns.
Call the Funds at (800) 438-5789 for more information.

. The Funds reserve the right to make payment for redeemed shares wholly or
in part by giving the redeeming shareholder portfolio securities. The
shareholder may pay transaction costs to dispose of these securities.

. We record all telephone calls for your protection and take measures to
identify the caller. As long as the Fund's transfer agent takes reasonable
measures to authenticate telephone requests on an investor's account,
neither the Funds, the Fund's distributor nor the transfer agent will be
held responsible for any losses resulting from unauthorized transactions.

. We may redeem your account if its value falls below $250 as a result of
redemptions (but not as a result of a decline in net asset value). You will
be notified in writing and allowed 60 days to increase the value of your
account to the minimum investment level.

. If you purchased shares directly through the Funds' transfer agent, the
transfer agent will send you confirmations of the opening of an account and
of all subsequent purchases, exchanges or redemptions in the account.
Confirmations of transactions effected through an institution will be sent
to the institution.

. Financial institutions are responsible for transmitting orders and payments
for their customers on a timely basis.

Shareholder Privileges

Free Checkwriting. Free checkwriting is available to holders of Class Y shares
of the Income Funds (other than the International Bond Fund [and the Short Term
Treasury Fund]), Tax-Free Funds and Money Market Funds who complete the
signature card section of the account application form. You may write checks in
the amount of $500 or more but you may not close a Fund account by writing a
check. We may change or terminate this program on 30 days' notice to you.

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<PAGE>

52
<PAGE>

Pricing Of Fund Shares
- -------------------------------------------------------------------------------

Each Fund's NAV is calculated on each day the New York Stock Exchange is open.
NAV is the value of a single share of a Fund. NAV for Class K shares is
calculated by (1) taking the current value of a Funds total assets allocated to
that class of shares, (2) subtracting the liabilities and expenses charged to
that class (3) dividing that amount by the total number of shares of that class
outstanding.

If the New York Stock Exchange closes early, the Funds will accelerate their
calculation of NAV and transaction deadlines to that time.

In determining each Money Market Fund's NAV, securities are valued at amortized
cost, which is approximately equal to market value.

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<PAGE>

Distributions
- -------------------------------------------------------------------------------

Balanced Fund, Growth & Income Fund, Small Company Growth Fund and International
Bond Fund: pay dividends, if any, quarterly.

Equity Selection Fund, Growth Opportunities Fund, NetNet Fund, Framlington
Emerging Markets Fund, Framlington Global Financial Services Fund, Framlington
Healthcare Fund, Framlington International Growth Fund, International Equity
Fund, Micro-Cap Equity Fund, Multi-Season Growth Fund, Small-Cap Value Fund and
Value Fund: pay dividends, if any, at least annually.

Short Term Treasury Fund, Cash Investment Fund, Tax-Free Money Market Fund,
Money Market Fund and U.S. Treasury Money Market Fund: dividends are declared
daily and paid monthly.

All Funds: distribute their net realized capital gains, if any, at least
annually.

It is possible that a Fund may make a distribution in excess of the Funds
earnings and profits. You will treat such a distribution as a return of capital
which is applied against and reduces your basis in your shares. You will treat
the excess of any such distribution over your basis in your shares as gain from
a sale or exchange of the shares.

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<PAGE>

Federal Tax Considerations
- -------------------------------------------------------------------------------

Taxes On Distributions

You will generally have to pay federal income tax on all Fund distributions.
Distributions will be taxed in the same manner whether you receive the
distributions in cash or in additional shares of the Fund. The Tax-Free Funds
and the Tax-Free Money Market Fund expect that a portion of their dividend
distributions will be exempt from federal income tax. Shareholders not subject
to tax on their income, generally will not be required to pay any tax on
distributions.

Taxes On Sales

If you sell shares of a Fund or exchange them for shares of another Fund, you
generally will be subject to tax on any taxable gain. Your taxable gain is
computed by subtracting your tax basis in the shares from the redemption
proceeds (in the case of a sale) or the value of the shares received (in the
case of an exchange). Because your tax basis depends on the original purchase
price and on the price at which any dividends may have been reinvested, you
should be sure to keep account statements so that you or your tax preparer will
be able to determine whether a sale or an exchange will result in a taxable
gain.

Other Considerations

If you have not provided complete, correct taxpayer information by law, the
Funds must withhold a portion of your distributions and redemption proceeds to
pay federal income taxes.

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<PAGE>

Management
- -------------------------------------------------------------------------------

Investment Advisors And Sub-Advisor

Munder Capital Management "MCM", 480 Pierce Street, Birmingham, Michigan 48009
is the investment advisor of each Fund other than International Equity Fund.
World Asset Management, L.L.C. "World", 255 East Brown Street, Birmingham,
Michigan 48009, is the investment advisor of the International Equity Fund.
World is a wholly-owned subsidiary of MCM. As of September 30, 1999, MCM [and
its affiliates] had approximately $__ billion in assets under management, of
which $__ billion were invested in equity securities, $__ billion were invested
in money market or other short-term instruments, $__ billion were invested in
other fixed income securities, and $__ billion in non-discretionary assets. As
of September 30, 1999, World had approximately $__ in assets under management.

The advisors provide overall investment management for their respective Funds.
Except for the Framlington Funds, the advisors provide all research and credit
analysis and are responsible for all purchases and sales of portfolio
securities.

Framlington Overseas Investment Management Limited "Framlington", a subsidiary
of MCM, is the sub-advisor of the Framlington Funds.

Framlington provides research and credit analysis for each of the Framlington
Funds and is responsible for making all purchases and sales of portfolio
securities for each of the Framlington Funds other than the Framlington Global
Financial Services Fund. MCM and Framlington each manage a portion of the assets
of the Framlington Global Financial Services Fund. MCM is responsible for all
purchases and sales of domestic securities held by the Framlington Global
Financial Services Fund. Framlington is responsible for the allocation of the
Funds assets among countries and for making all purchases and sales of foreign
securities held by the Fund.

During the fiscal year ended June 30, 1999, each Fund paid an advisory fee at an
annual rate based on the average daily net assets of the Fund (after waivers, if
any) as follows:

Balanced Fund 0.65%
Growth & Income Fund 0.75%
Growth Opportunities Fund 0.75%
International Equity Fund 0.75%
Micro-Cap Equity Fund 1.00%
Multi-Season Growth Fund 0.75%
NetNet Fund 1.00%
Real Estate Equity Investment Fund 0.74%
Small-Cap Value Fund 0.75%
Small Company Growth Fund 0.75%
Value Fund 0.74%
Framlington Emerging Markets Fund 1.25%
Framlington Global Financial Services
Fund 0.75%
Framlington Healthcare Fund 1.00%
Framlington International Growth Fund 1.00%
Bond Fund 0.50%
Intermediate Bond Fund 0.50%
International Bond Fund 0.50%
U.S. Government Income Fund 0.50%
Michigan Tax-Free Bond Fund 0.50%
Tax-Free Bond Fund 0.50%
Tax-Free Short-Intermediate Bond Fund 0.50%
Short Term Treasury Fund 0.25%
Cash Investment Fund 0.35%
Money Market Fund 0.40%
Tax-Free Money Market Fund 0.35%
U.S. Treasury Money Market Fund 0.35%

Because MCM voluntarily agreed to waive a portion of its fees for the Multi-
Season Growth Fund, the payment shown above for that Fund is less than the
contractual advisory fee of 1.00% of the Multi-Season Growth Funds average daily
net assets.

MCM may, from time to time, make payments to banks, broker-dealers or other
financial institutions for certain services to the Funds and/or their
shareholders, including sub-administration, sub-transfer agency and shareholder
servicing. MCM may make such payments out of its own resources and there are no
additional costs to the Funds or their shareholders.

Please note that Comerica Bank, an affiliate of the advisor, receives a fee from
the Funds for providing shareholder services to its customers who own shares of
the Funds.

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<PAGE>

Performance Information. The tables below contain performance information for
certain Funds created through the conversion of a common or collective trust
fund which had investment objectives and policies materially similar to those of
the corresponding Funds. Immediately before and after the conversion, the same
person managed both the common or collective trust fund and the corresponding
Fund.

The table for each Fund:

. includes the average annual total returns of the common or collective
trust fund and the average annual total returns of the corresponding
Fund linked together;

. assumes that net investment income and dividends have been reinvested;

. assumes that the common or collective trust fund paid the same levels
of fees and expenses as the corresponding Fund currently pays;

. does not reflect any potential negative impact on the common and
collective trust funds performance if they had been subjected to the
same regulatory restrictions (the 1940 Act and the Internal Revenue
Code) as the corresponding Fund; and

. indicates past performance only and does not predict future results.

Munder Small Russell
Period Ended Company Growth 2000
June 30, 1999 Fund (Class Y)* Index**
------------- --------------- -------
1 Year................. % %
3 Years................ % %
5 Years................ % %
10 Years............... % %
Inception on December
31, 1982............... % %

_______________________________________
* Converted from collective trust fund to mutual fund on December 1, 1991.
** Russell 2000 Index performance shows total return in U.S. dollars but does
not reflect the deduction of fees, expenses and taxes. Source: Lipper Analytical
Services, Inc.

Munder FT/S&P
International Actuaries
Period Ended Equity Fund World Index
June 30, 1999 (Class Y )* ex. U.S.**
------------- ------------- -----------
1 Year................... % %
3 Years.................. % %
5 Years.................. % %
Inception on September
30, 1990................. % %

_______________________________________
* Converted from collective trust fund to mutual fund on December 1, 1991.
** FT/S&P Actuaries World Index ex. U.S. performance shows total return in U.S.
dollars but does not reflect the deduction of fees, expenses and taxes. Source:
Ibbotson Associates, Inc.

Lehman
Brothers
Period Ended Munder Bond Fund Gov't/Corp.
June 30, 1999 (Class Y )* Bond Index**
------------- ---------------- ------------
1 Year................. % %
3 Years................ % %
5 Years................ % %
10 Years............... % %

_______________________________________
* Converted from collective trust fund to mutual fund on December 1, 1991.
** Lehman Brothers Government/Corporate Bond Index performance shows total
return in U.S. dollars but does not reflect the deduction of fees, expenses and
taxes. Source: Lipper Analytical Services, Inc.

Munder U.S.
Government Lehman
Income Brothers
Period Ended Fund Gov't/Corp.
June 30, 1999 (Class Y)* Bond Index**
------------- ----------- ------------
1 Year................. % %
3 Years................ % %
5 Years................ % %
10 Years............... % %

______________________________________
* Converted from collective trust fund to mutual fund on July 5, 1994.
** Lehman Brothers Government/Corporate Bond Index performance shows total
return in U.S. dollars but does not reflect the deduction of fees, expenses and
taxes. Source: Lipper Analytical Services, Inc.

57
<PAGE>

Lehman
Munder Brothers
Intermediate Intermediate
Period Ended Bond Fund Gov't/Bond
June 30, 1999 (Class Y)* Index**
------------- ------------ ------------
1 Year................... % %
3 Years.................. % %
5 Years.................. % %
10 Years................. % %
Inception on March 31,
1982..................... % %

______________________________________
* Converted from collective trust fund to mutual fund on December 1, 1991.
** Lehman Brothers Intermediate Government/Corporate Bond Index performance
shows total return in U.S. dollars but does not reflect the deduction of fees,
expenses and taxes. Source: Lipper Analytical Services, Inc.

Munder
Tax-Free Lehman
Period Ended Bond Fund 20-Year Muni
June 30, 1999 (Class Y)* Bond Index**
------------- ---------- ------------
1 Year................. % %
3 Years................ % %
5 Years................ % %
10 Years............... % %

_____________________________________
* Converted from common trust fund to mutual fund on July 21, 1994.
** Lehman 20-Year Municipal Bond Index performance shows total return in U.S.
dollars but does not reflect the deduction of fees, expenses and taxes. Source:
Lipper Analytical Services, Inc.

Indices

The Lehman Brothers 20-Year Municipal Bond Index is a performance benchmark for
the long-term investment-grade tax-exempt bond market.

Performance of Framlington Accounts Managed by the Sub-Advisor

The tables below contain certain performance information provided by the sub-
advisor relating to accounts managed by the sub-advisor which have investment
objectives and policies similar to those of the corresponding Framlington
Funds. In the case of the Healthcare portfolio performance, the data relates to
a unit trust organized under the laws of the United Kingdom managed by the same
personnel of the sub-advisor with similar investment objectives and policies to
the Framlington Healthcare Fund. In the case of Emerging Markets portfolio
performance, the data relates to a Canadian-based institutional emerging markets
portfolio managed by the same personnel of the sub-advisor with similar
investment objectives and policies to the Framlington Emerging Markets Fund.

58
<PAGE>

Funds will be affected by regulatory requirements under the 1940 Act and
requirements of the Internal Revenue Code to qualify as a regulated investment
company.

S&P Healthcare
U.K. Composite
Period Ended Health Index Capital
December 31, 1996 Portfolio Change
- ----------------- --------- ------
1 Year............... 10.75% 18.48%
3 Years.............. 96.93% 100.49%
5 Years.............. 99.43% 45.60%
Inception on April
30, 1987............. 411.08% 239.64%

S&P Healthcare Composite Index performance shows capital change in U.S. dollars
but does not reflect the deduction of fees, expenses and taxes. Source:
Datastream.

MSCI Emerging
Canadian Markets Free
Period Ended Emerging Total
December 31, 1996 Markets Account Return
- ----------------- --------------- ------
1 Year................ 5.16% 6.03%
Inception on November
1, 1994............... (3.68)% (12.37)%

MSCI Emerging Markets Free Index performance shows total return in U.S. Dollars
but does not reflect the deduction of fees, expenses and taxes. Source:
Datastream.

Indices

The S&P Healthcare Composite Index is the composite Healthcare section of the
S&P 500 Index as defined and tracked by S&P. This index covers securities listed
in the United States only.

Portfolio Managers [to be revised]

Balanced Fund, Equity Selection Fund, Growth Opportunities Fund, NetNet Fund,
Micro-Cap Equity Fund And Small Company Growth Fund.

A committee of professional portfolio managers employed by MCM makes investment
decisions for the Funds.

Growth & Income Fund

Otto Hinzmann, Jr. has been the Funds portfolio manager since February 1995. Mr.
Hinzmann has been a Vice President and Director of Equity Management of MCM or
of Old MCM, Inc. (Old MCM), the predecessor to MCM, since January 1987.

International Equity Fund

Todd B. Johnson and Theodore Miller jointly manage the Fund. Mr. Johnson,
President and Chief Investment Officer of World, and Mr. Miller, senior
portfolio manager of the Fund, have managed the Fund since July 1992 and October
1996, respectively. Mr. Miller previously worked as the primary analyst for the
Fund (1996) and for Interacciones Global Inc. (1993-1995).

Multi-Season Growth Fund

Leonard J. Barr II has been the Funds portfolio manager since the Funds
inception in April 1993. Mr. Barr is the Senior Vice President and Director of
Research of MCM.

Real Estate Equity Investment Fund

Small-Cap Value Fund And Value Fund

Gerald Seizert, Edward Eberle and Brian Wall jointly manage the Funds. Mr.
Seizert, a Chief Investment Officer - Equities of MCM, has managed the Funds
since they commenced operations. Prior to joining the advisor in 1995, Mr.
Seizert was a Director and Managing Partner of Loomis, Sayles & Company,

59
<PAGE>

L.P. (1984-1995). Mr. Eberle, who has managed the Small-Cap Value Fund since
March 1997 and the Value Fund since October 1996, was formerly the primary
analyst for the Funds. Prior to joining MCM in 1995, he was an Executive Vice
President and Portfolio Manager for Westpointe Financial Corporation. Mr. Wall,
who has managed the Funds since January 1998, was formerly a primary analyst for
the Funds. Prior to joining the MCM in 1995, he was a Senior Equity Analyst with
Woodbridge Capital Management, Inc. (1994-1995).

Framlington Emerging Markets Fund

Framlington Global Financial Services Fund

A committee of professional managers employed by MCM or Framlington makes
decisions for the Fund.

Framlington Healthcare Fund

Antony Milford, head of the Specialist Desk for Framlington, has been the Funds
primary portfolio manager since the Funds inception. Mr. Milford has managed
funds for Framlington since 1971.

Framlington International Growth Fund

Bond Fund

Intermediate Bond Fund

International Bond Fund

U.S. Government Income Fund

Michigan Tax-Free Bond Fund, Tax-Free Bond Fund And Tax-Free Short-Intermediate
Bond Fund Talmadge D. Gunn, Vice President and Director of Tax-Exempt Trading of
MCM since 1993, manages the Tax-Free Funds.

Short Term Treasury Fund

Sharon E. Fayolle, Vice President and Director of Money Market Trading for MCM
or Old MCM, has managed the Fund since 1996. Prior to that, she managed an
international portfolio for Ford Motor Company.

60
<PAGE>

Financial Highlights
- --------------------------------------------------------------------------------

The financial highlights table is intended to help shareholders understand each
Funds financial performance for the past 5 years (or, if shorter, the period of
the Funds operations). Certain information reflects financial results for a
single Fund share. The total returns in the table represent the rate that an
investor would have earned (or lost) on an investment in the Fund (assuming
reinvestment of all dividends and distributions). Because the Class Y shares of
the Equity Selection Fund had not commenced operations on June 30, 1999,
financial highlights are not presented for that Fund. The information has been
audited by Ernst & Young LLP, independent accountants, whose report along with
each Funds financial statements, are included in the annual reports of the
Funds, and are incorporated by reference into the Statement of Additional
Information. You may obtain the annual reports without charge by calling (800)
438-5789.

<TABLE>
<CAPTION>
Balanced Fund(a)
---------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e)
------- ------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment income.........................
Net realized and unrealized gain/(loss) on
investments...................................
Total from investment operations..............
Less distributions:
Dividends from net investment income..........
Distributions from net realized gains.........
Total distributions...........................
Net asset value, end of period................
Total return (b)..............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to average
net assets...................................
Ratio of net investment income to average
net assets....................................
Portfolio turnover rate.......................
Ratio of operating expenses to average
net assets without waivers....................
</TABLE>

________________

61
<PAGE>

<TABLE>
<CAPTION>
Growth
Opportunities
Growth & Income Fund (a) Fund (a)
-------------------------------------------------------------- ------------------
Year Year Year Year Period Period Year Period
Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(g) 6/30/98 6/30/96(g) 6/30/95(d) 2/28/95(e) 6/30/99
------- ------- ---------- ------- ---------- ---------- ---------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.........
Income from investment operations:
Net investment income........................
Net realized and/or unrealized gain on
investments..................................
Total from investment operations.............
Less distributions:
Dividends from net investment income.........
Distributions from net realized gains........
Total distributions..........................
Net asset value, end of period...............
Total return (b).............................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000s)..........
Ratio of operating expenses to average
net assets..................................
Ratio of net investment income to average
net assets...................................
Portfolio turnover rate......................
Ratio of operating expenses to average
net assets without waivers and/ or
expenses reimbursed..........................
</TABLE>

____________

62
<PAGE>

<TABLE>
<CAPTION>
International Equity Fund (a)
---------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e,f)
------- ------- ---------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......
Income from investment operations:
Net investment income......................
Net realized and unrealized
gain/(loss) on investments.................
Total from investment operations...........
Less distributions:
Dividends from net investment income.......
Distributions from net realized
gains......................................
Distributions from capital.................
Total distributions........................
Net asset value, end of period.............
Total return (b)...........................
Ratios to average net
assets/supplemental data:
Net assets, end of period (in 000s)........
Ratio of operating expenses to
average net assets.........................
Ratio of net investment income to
average net assets........................
Portfolio turnover rate....................
Ratio of operating expenses to average
net assets without waivers.................
</TABLE>

__________________

63
<PAGE>

<TABLE>
<CAPTION>
Micro-Cap Equity Fund (a)
--------------------------------------------
Year Year Period
Ended Ended Ended
6/30/99) 6/30/98(d) 6/30/97(d)
-------- ---------- ----------
<S> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment income/(loss)..................
Net realized and unrealized gain on
investments...................................
Total from investment operations..............
Less distributions:
Dividends from net investment income..........
Distributions from net realized gains.........
Total distributions...........................
Net asset value, end of period................
Total return (b)..............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to
average net assets............................
Ratio of net investment income to
average net assets...........................
Portfolio turnover rate.......................
Ratio of operating expenses to average net
assets without waivers and/or expenses
reimbursed....................................
</TABLE>

_________________________

64
<PAGE>

<TABLE>
<CAPTION>
Multi-Season Growth Fund (a) NetNet Fund (a)
-------------------------------------------------------- ------------------
Year Year Year Year Period Year Period
Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/96(f) 6/30/98(f) 6/30/97(f) 6/30/95(d,e,h) 6/30/99 6/30/98
------- ---------- ---------- ---------- -------------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment income/(loss)..................
Net realized and unrealized gain/(loss)
on investments...............................
Total from investment operations..............
Less distributions:
Dividends from net investment income..........
Distributions from net realized gains.........
Total distributions...........................
Net asset value at end of period..............
Total return (b)..............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to average
net assets...................................
Ratio of net investment income/(loss) to
average net assets............................
Portfolio turnover rate.......................
Ratio of operating expenses to average net
assets without waivers and/or expenses
reimbursed....................................
</TABLE>
_____________________

65
<PAGE>

<TABLE>
<CAPTION>
Real Estate Equity Investment Fund (a)
-----------------------------------------------------
Year Year Year Year Period
Ended Ended Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97 6/30/96(e) 6/30/95(d)
------- ---------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment income/(loss)..................
Net realized and unrealized gain on
investments..................................
Total from investment operations..............
Less distributions:
Dividends from net investment income..........
Distributions in excess of net investment
income........................................
Distributions from net realized gains.........
Distributions from paid-in capital............
Total distributions...........................
Net asset value, end of period................
Total return (b)..............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to average net
assets.......................................
Ratio of net investment income/(loss) to
average net assets...........................
Portfolio turnover rate.......................
Ratio of operating expenses to average net
assets without waivers........................
</TABLE>

_________________

66
<PAGE>

<TABLE>
<CAPTION>
Small-Cap Value Fund (a)
------------------------------
Year Year Year
Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97
------- ---------- -------
<S> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment income/(loss)..................
Net realized and unrealized gain on
investments..................................
Total from investment operations..............
Less distributions:
Dividends from net investment income..........
Distributions in excess of net investment
income.......................................
Distributions from net realized gains.........
Distributions from paid-in capital............
Total distributions...........................
Net asset value, end of period................
Total return (b)..............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to average net
assets.......................................
Ratio of net investment income/(loss) to
average net assets...........................
Portfolio turnover rate.......................
Ratio of operating expenses to average net
assets without waivers........................
</TABLE>

67
<PAGE>

<TABLE>
<CAPTION>
Small Company Growth Fund (a)
---------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96(f) 6/30/95(e) 2/28/95(d)
------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment loss...........................
Net realized and unrealized gain/(loss)
on investments................................
Total from investment operations..............
Less distributions:
Distributions from net realized gains.........
Total distributions...........................
Net asset value, end of period................
Total return (b)..............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to average
net assets....................................
Ratio of net investment loss to average
net assets....................................
Portfolio turnover rate.......................
Ratio of operating expenses to average
net assets without waivers....................
</TABLE>

________________________

68
<PAGE>

<TABLE>
<CAPTION>
Value Fund (a)
------------------------------------------------
Year Year Year Period
Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/96(d)
------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period.........................
Income from investment operations:
Net investment income........................................
Net realized and unrealized gain/(loss) on investments.......
Total from investment operations.............................
Less distributions:
Dividends from net investment income.........................
Distributions from net realized gains........................
Total distributions..........................................
Net asset value, end of period...............................
Total return (b).............................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)..........................
Ratio of operating expenses to average net assets............
Ratio of net investment income to average net assets.........
Portfolio turnover rate......................................
Ratio of operating expenses to average net assets
without waivers..............................................
</TABLE>

____________________

69
<PAGE>

<TABLE>
<CAPTION>
Framlington Global
Framlington Emerging Markets Fund (a) Financial Services Fund (a)
---------------------------------------------------------------------
Year Year Period Year Period
Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97(d) 6/30/99 6/30/98
------- ---------- ---------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period............
Income from investment operations:
Net investment income/(loss)....................
Net realized and unrealized gain/(loss)
on investments..................................
Total from investment operations................
Less distributions:
Dividends from net investment income............
Distributions from net realized gains...........
Distributions in excess of net realized
gains...........................................
Total distributions.............................
Net asset value, end of period..................
Total return (b)................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s).............
Ratio of operating expenses to average net
assets..........................................
Ratio of net investment income/(loss)
to average net assets..........................
Portfolio turnover rate.........................
Ratio of operating expenses to average net
assets without expenses reimbursed..............
</TABLE>

___________________

70
<PAGE>

<TABLE>
<CAPTION>
Framlington International Growth
Framlington Healthcare Fund (a) Fund (a)
---------------------------------------------------------------------------
Year Year Period Year Year Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(d) 6/30/97 6/30/99 6/30/98(d) 6/30/97(d)
------- ---------- ------- ------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............
Income from investment operations:
Net investment income/(loss).....................
Net realized and unrealized gain/(loss) on
investments......................................
Total from investment operations.................
Less distributions:
Dividends from net investment income.............
Distributions from net realized gains............
Distributions in excess of net realized gains....
Total distributions..............................
Net asset value, end of period...................
Total return (b).................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)..............
Ratio of operating expenses to average net
assets...........................................
Ratio of net investment income/(loss)
to average net assets...........................
Portfolio turnover rate..........................
Ratio of operating expenses to average net
assets without expenses reimbursed...............
</TABLE>

___________________

71
<PAGE>

<TABLE>
<CAPTION>
Bond Fund (a)
------------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97 6/30/96 6/30/95(d) 2/28/95(e,f)
------- ---------- ------- ------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment income.........................
Net realized and unrealized gain/(loss) on
investments...................................
Total from investment operations..............
Less distributions:
Dividends from net investment income..........
Distributions from net realized gains.........
Total distributions...........................
Net asset value, end of period................
Total return (b)..............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to average net
assets........................................
Ratio of net investment income to average net
assets........................................
Portfolio turnover rate.......................
Ratio of operating expenses to average net
assets without waivers........................
</TABLE>

___________________

72
<PAGE>

<TABLE>
<CAPTION>
Intermediate Bond Fund (a)
-----------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96 6/30/95(d) 2/28/95(e)
------- ---------- ---------- ------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...........
Income from investment operations:
Net investment income..........................
Net realized and unrealized gain/(loss) on
investments....................................
Total from investment operations...............
Less distributions:
Dividends from net investment income...........
Distributions from net realized gains..........
Total distributions Net asset value, end of
period.........................................
Total return (b)...............................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)............
Ratio of operating expenses to average net
assets.........................................
Ratio of net investment income to average net
assets.........................................
Portfolio turnover rate........................
Ratio of operating expenses to average net
assets without waivers.........................
</TABLE>

___________________

73
<PAGE>

<TABLE>
<CAPTION>
International Bond Fund (a) U.S. Government Income Fund (a)
----------------------------------------------------------------------------------------
Year Year Period Year Year Year Year Period Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/99 6/30/98 6/30/97 6/30/96(f) 6/30/95(d) 2/28/95(e)
-------- ------- ------- ------- ------- ------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......
Income from investment operations:
Net investment income.....................
Net realized and unrealized gain/(loss)
on investments............................
Total from investment operations..........
Less distributions:
Dividends from net investment income......
Distributions from net realized gains.....
Total distributions.......................
Net asset value, end of period............
Total return (b)..........................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000s).......
Ratio of operating expenses to average net
assets....................................
Ratio of net investment income to average
net assets................................
Portfolio turnover rate...................
Ratio of operating expenses to average net
assets without waivers....................
</TABLE>

___________________

74
<PAGE>

<TABLE>
<CAPTION>
Michigan Tax-Free Bond Fund (a)
-----------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(e) 6/30/96(e) 6/30/95(d) 2/28/95(e,f)
------- ------- ---------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............
Income from investment operations:
Net investment income............................
Net realized and unrealized gain/(loss) on
investments......................................
Total from investment operations.................
Less distributions:
Dividends from net investment income..............
Distributions from net realized gains.............
Total distributions...............................
Net asset value, end of period....................
Total return (b)..................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)...............
Ratio of operating expenses to average net
assets............................................
Ratio of net investment income to average
net assets........................................
Portfolio turnover rate...........................
Ratio of operating expenses to average net assets
without waivers...................................
</TABLE>

___________________

75
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Bond Fund (a)
----------------------------------------------------------------------------
Year Year Year Year Period Period
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(e) 6/30/96(e) 6/30/95(d,e) 2/28/95(f)
------- ------- ---------- ---------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period............
Income from investment operations:
Net investment income...........................
Net realized and unrealized gain/(loss) on
investments.....................................
Total from investment operations................
Less distributions:
Dividends from net investment income............
Distributions from net realized gains...........
Total distributions.............................
Net asset value, end of period..................
Total return (b)................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s).............
Ratio of operating expenses to average net
assets..........................................
Ratio of net investment income to average net
assets..........................................
Portfolio turnover rate.........................
Ratio of operating expenses to average net
assets without waivers..........................
</TABLE>

___________________

76
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Short-Intermediate Bond Fund (a)
------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d) 2/28/95(e)
-------- ------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..........
Income from investment operations:
Net investment income.........................
Net realized and unrealized gain/(loss)
on investments................................
Total from investment operations..............
Less distributions:
Dividends from net investment income..........
Distributions from net realized gains.........
Total distributions...........................
Net asset value, end of period................
Total return (b)..............................
Ratios to average net assets/supplemental
data:
Net assets, end of period (in 000s)...........
Ratio of operating expenses to average net
assets........................................
Ratio of net investment income to average net
assets........................................
Portfolio turnover rate ......................
Ratio of operating expenses to average net
assets without waivers........................
</TABLE>

_________________________

77
<PAGE>

<TABLE>
<CAPTION>
Short Term Treasury Fund (a)
------------------------------------------
Year Year Period
Ended Ended Ended
6/30/99 6/30/98 6/30/97(d)
--------- --------- ------------
<S> <C> <C> <C>
Net asset value, beginning of period...............................
Income from investment operations:
Net investment income..............................................
Net realized and/or unrealized gain on investments
Total from investment operations...................................
Less distributions:
Dividends from net investment income...............................
Total distributions................................................
Net asset value, end of period.............................. ......
Total return (b)...................................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)................................
Ratio of operating expenses to average net assets..................
Ratio of net investment income to average net assets...............
Portfolio turnover rate............................................
Ratio of operating expenses to average net assets without expenses
reimbursed.........................................................
</TABLE>

__________________

78
<PAGE>

<TABLE>
<CAPTION>
Cash Investment Fund (a)
--------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
------- ------- ------- ------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ..................................
Income from investment
operations:
Net investment income.......................
Total from investment
operations..................................
Less distributions:
Dividends from net
investment income...........................
Total Distributions.........................
Net asset value, end of
period......................................
Total return (b)............................
Ratios to average net
assets/supplemental data:
Net assets, end of period (in
000s).......................................
Ratio of operating expenses
to average net assets.......................
Ratio of net investment
income to average net
assets......................................
Ratio of operating expenses to
average net assets without
waivers.....................................
</TABLE>

______________________

79
<PAGE>

<TABLE>
<CAPTION>
Money Market Fund (a)
------------------------------------------------------------
Year Year Year Year Period
Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d,e)
------- ------- ------- ------- ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period...............
Income from investment operations:
Net investment income..............................
Total from investment operations...................
Less distributions:
Dividends from net investment income...............
Total distributions................................
Net asset value, end of period.....................
Total return (b)...................................
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000s)................
Ratio of operating expenses to average
net assets.........................................
Ratio of net investment income to
average net assets.................................
Ratio of operating expenses to average.............
net assets without waivers.........................
</TABLE>

____________________

80
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Money Market Fund (a)
--------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
------- ------- ------- ------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period........
Income from investment
operations:
Net investment income.......................
Total from investment operations............
Less distributions:
Dividends from net investment
income......................................
Total distributions.........................
Net asset value end of period...............
Total return (b)............................
Ratios to average net
assets/supplemental data:
Net assets, end of period (in 000s).........
Ratio of operating expenses to
average net assets..........................
Ratio of net investment income to
average net assets..........................
Ratio of operating expenses to
average net assets without waivers..........
</TABLE>

___________________

81
<PAGE>

<TABLE>
<CAPTION>
U.S. Treasury Money Market Fund (a)
-----------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
------- ------- ------- ------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period......................................
Income from investment
operations:
Net investment income.......................
Total from investment
operations..................................
Less distributions:
Dividends from net investment
income......................................
Total distributions.........................
Net asset value, end of period..............
Total return (b)............................
Ratios to average net
assets/supplemental data:
Net assets, end of period
(in 000s)...................................
Ratio of operating expenses to
average net assets..........................
Ratio of net investment income to
average net assets..........................
Ratio of operating expenses to
average net assets without
waivers.....................................
</TABLE>

____________________

82
<PAGE>

For More Information

<TABLE>

To Obtain Information:
<S> <C>
More information about the Funds is available free upon request,
including the following:
-----------------------------------------------

Annual/Semi-Annual Reports By telephone
Call 1-800-438-5789
You will receive unaudited semi-annual reports and audited annual
reports on a regular basis from the Funds. In addition, you will By mail
also receive updated prospectuses or supplements to this The Munder Funds
prospectus. In order to eliminate duplicate mailings, each Fund 480 Pierce Street
will only send one copy of the above communications to (1) accounts Birmingham, MI 48009
with the same primary record owner, (2) joint tenant accounts, (3)
tenant in common accounts and (4) accounts which have the same On the Internet
address.
Text-only versions of fund documents can be
viewed online or downloaded from:
Statement Of Additional Information
Securities and Exchange Commission
Provides more details about the Funds and their policies. A http://www.sec.gov
current Statement of Additional Information is on file with the
Securities and Exchange Commission and is incorporated by reference You can also obtain copies by visiting the
(is legally considered part of this prospectus). Securities and Exchange Commissions Public
Reference Room in Washington, D.C. (phone
1-800-SEC-0330) or by sending your request and
a duplicating fee to the Securities and
Exchange Commissions Public Reference Section,
Washington, D.C. 20549-6009.

You may also find more information about the
Funds on the Internet at:
http://www.munderfunds.com

-----------------------------------------------
</TABLE>

The Munder Funds, Inc.
SEC file number: 811-7346

The Munder Funds Trust
SEC file number: 811-5899

The Munder Framlington Funds Trust
SEC file number: 811-7897

<PAGE>

Class A, B & C Shares

[Munder Logo]
Prospectus

October 26, 1999

The Munder Income Funds
Bond
Intermediate Bond
International Bond
U.S. Government Income
Michigan Tax-Free Bond
Tax-Free Bond
Tax-Free Short-Intermediate Bond

As with all mutual funds, the
Securities and Exchange
Commission has not approved or
disapproved these securities nor
passed upon the accuracy or
adequacy of this prospectus. It
is a criminal offense to state
otherwise.
<PAGE>

Table of Contents

2 Risk/Return Summary

. Income Funds
. Tax-Free Funds
10 Summary Of Principal Risks
11 Who May Want To Invest
12 Fees And Expenses

14 More About The Funds

14 Glossary
15 Special Risks And Other Considerations
17 Additional Description Of Investments And Investment Strategies

21 Your Investment

21 How To Reach The Funds
21 Purchasing Shares
22 Exchanging Shares
22 Redeeming Shares
23 Additional Policies For Purchases, Exchanges And Redemptions
24 Shareholder Privileges

25 Distribution Arrangements

25 Share Class Selection
25 Applicable Sales Charge
27 CDSC
28 12B-1 Fees
28 Other Information

29 Pricing Of Fund Shares

29 Distributions

30 Federal Tax COnsiderations
30 Taxes On Distributions
30 Taxes On Sales Or Exchanges
30 Other Considerations

31 Management

31 Investment Advisor
31 Portfolio Management

32 Financial Highlights

Back Cover For Additional Information
<PAGE>

Risk/Return Summary
- -----------------------------------------------------------------------------

Certain terms used in this prospectus are defined in the Glossary.

An investment in the Funds is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency.

. how the Fund's average annual returns for 1, 5, and 10 years (or over the
life of the Fund if the Fund is less than 10 years old) compare to those of
a broad based securities market index; and;

. changes in the Fund's performance from year to year over 10 years (or over
the life of the Fund if the Fund is less than 10 old).

When you consider this information, please remember that a Fund's performance in
past years is not necessarily an indication of how the Fund will perform in the
future.

2
<PAGE>

Income Funds

Bond Fund

Goal

The Fund's primary goal is to provide a high level of current income. Its
secondary goal is capital appreciation.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its total assets in a broad range of bonds and other fixed income
securities. These may include:

The Fund's dollar-weighted average maturity will generally range between six and
fifteen years.

The Fund will purchase only fixed income securities that are rated investment
grade or better, or if unrated, are of comparable quality.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may be
subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

____________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year 5 Years Inception
- ----------------------- ------- -------- ---------
Class A (12/9/92)
Class B (3/13/96)
Class C (3/25/96)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

3
<PAGE>

Intermediate Bond Fund

Goal

The Fund's goal is to provide a competitive rate of return which, over time,
exceeds the rate of inflation and the return provided by money market
instruments.

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its total assets in a broad range of bonds and other fixed income
securities. These may include:

The Fund's dollar-weighted average maturity will generally range between three
and eight years.

The Fund will purchase only fixed income securities that are rated investment
grade or better, or if unrated, are of comparable quality.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk. To the extent that the Fund purchases foreign securities, it may be
subject to foreign securities risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

_________________
Year-to-date through September 30, 1999: ______%

Best Quarter: Q____199__ ___%
Worst Quarter: Q____199__ ___%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year 5 Years Inception
- --------------------- ------ ------- ---------
Class A (11/24/92)
Class B (10/25/94)
Class C (4/19/96)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

__________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

4
<PAGE>

International Bond Fund

Goal

The Fund's goal is to realize a competitive total return through a combination
of current income and capital appreciation.

Principal Investment Strategies

The Fund will invest in the securities of issuers in at least three foreign
countries.

The Fund's dollar-weighted average maturity will generally range between three
and fifteen years.

The Fund may invest a portion of its assets in domestic obligations, including
U.S. Government securities and obligations of domestic banks and corporations.

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may enter into forward currency exchange contracts.

Principal Risks

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1997: _____%
1998: _____%

________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- --------------------- ------ ---------
Class A (10/17/96)
Class B (6/9/97)
Class C (6/4/98)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

5
<PAGE>

U.S. Government Income Fund

Goal

The Fund's goal is to provide high current income.

Principal Investment Strategies

The Fund's strategy focuses on areas where the advisor believes value can be
added. These include credit analysis and an analysis of such factors as interest
rate relationships, the relative attractiveness of the government-related
sectors of the market and the characteristics of individual issues.

The Fund's dollar-weighted average maturity generally will range between six and
fifteen years.

The Fund may also invest in other fixed income securities.

Principal Risks

The principal risk of investing in the Fund is interest rate risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1995: _____%
1996: _____%
1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- --------------------- ------ ---------
Class A (7/28/94)
Class B (9/6/95)
Class C (8/12/96)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

6
<PAGE>

- --------------------------------------------------------------------------------
Tax-Free Funds
- --------------------------------------------------------------------------------

Michigan Tax-Free Bond Fund
(Offered only in the State of Michigan.)

Goal

Principal Investment Strategies

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk,
credit risk and non-diversified risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1995: _____%
1996: _____%
1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- ------------------------------ ------------ ---------------
Class A (2/15/94)
Class B (7/5/94)
Class C (10/4/96)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

7
<PAGE>

Tax-Free Bond Fund

Goal

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its net assets in municipal obligations.

In selecting securities for the Fund, the advisor places a premium on value and
diversifies the Fund's portfolio holdings across maturities, industries and
geographic locations.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk and
credit risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class B)

The annual returns in the bar chart are for the Fund's Class B Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1996: _____%
1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%
Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- ------------------------------ ------------ ---------------
Class A (10/9/95)
Class B (12/6/94)
Class C (7/7/97)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

8
<PAGE>

Tax-Free Short-Intermediate Bond Fund

Goal

Principal Investment Strategies

The Fund pursues its goals by investing, under normal market conditions, at
least 65% of its net assets in municipal obligations.

Under normal market conditions, at least 80% of the Fund's net assets will be
invested in municipal obligations whose interest is exempt from regular Federal
income tax.

The Fund generally buys obligations with remaining maturities of five years or
less. The Fund's dollar-weighted average maturity will generally range between
two and five years.

The Fund may invest more than 25% of its assets in municipal obligations issued
by the State of Michigan and its political subdivisions.

The Fund is "non-diversified" under the 1940 Act and may invest more of its
assets in fewer issuers than a "diversified" investment company.

The Fund may also invest in other fixed income securities.

Principal Risks

Among the principal risks of investing in the Fund are interest rate risk,
credit risk and non-diversified risk.

Further information about the Fund's principal investment strategies and risks
is provided below under "Summary of Principal Risks" and "More About the Funds."

Performance

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

______________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year 5 Years Inception
- --------------------------- -------- --------- -------------
Class A (11/30/92)
Class B (5/16/96)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

______________
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

9
<PAGE>

Summary of Principal Risks of the Funds

The share price of the Funds will change daily based on market conditions and
other factors. Therefore, you may lose money if you invest in the Funds.

Credit (or Default) Risk is the risk of loss because an issuer of a security may
default on its payment obligations. Also, an issuer may suffer adverse changes
in its financial condition that could lower the credit quality of a security,
leading to greater volatility in the price of the security and in shares of the
Fund. A change in the quality rating of a bond can affect the bond's liquidity
and make it more difficult for the Fund to sell. Funds particularly subject to
this risk are: Bond Fund, Intermediate Bond Fund, International Bond Fund, U.S.
Government Income Fund, Michigan Tax-Free Bond Fund, Tax-Free Bond Fund and Tax-
Free Short-Intermediate Bond Fund.

Derivatives Risk is the risk that loss may result from a Fund's use of futures
and options on futures contracts, options, forward currency exchange contracts
and other forms of derivative instruments. The primary risk with many
derivatives is that they can amplify a gain or loss, potentially earning or
losing substantially more money than the actual cost of the derivative
instrument. International Bond Fund is particularly subject to this risk.

Foreign Securities Risk is the risk of loss because investments by a Fund in
foreign securities may experience greater and more rapid change in value than
investments in U.S. securities. Foreign securities are generally more volatile
and less liquid than U.S. securities, in part because of greater political and
economic risks and because there is less public information available about
foreign companies. Issuers of foreign securities are generally not subject to
the same degree of regulation as are U.S. issuers. The reporting, accounting and
auditing standards of foreign countries may differ, in some cases significantly,
from U.S. standards. Funds particularly subject to this risk are: Bond Fund,
Intermediate Bond Fund and International Bond Fund.

Currency Risk. Funds that invest in foreign securities denominated in
foreign currencies may also be subject to currency risk. This is the
risk of loss because a decline in the value of foreign currencies
relative to the U.S. dollar will reduce the value of a Fund's portfolio
securities denominated in those currencies. International Bond Fund is
particularly subject to this risk.

Interest Rate Risk is the risk of loss because increases in prevailing interest
rates will cause fixed-income securities held by a Fund to decline in value.
Longer term bonds are generally more sensitive to interest rate changes than
shorter term bonds. Generally, the longer the average maturity of the bonds held
by the Fund, the more the Fund's share price will fluctuate in response to
interest rate changes. Funds particularly subject to this risk are Bond Fund,
Intermediate Bond Fund, International Bond Fund, U.S. Government Income Fund,
Michigan Tax-Free Bond Fund and Tax-Free Short-Intermediate Bond Fund.

Market Risk is the risk of loss because the value of the securities in which a
Fund invests may decline in response to general economic conditions. Price
changes may be temporary or last for extended periods. For example, stock prices
have historically risen and fallen in periodic cycles. In addition, the value of
a Fund's investments may decline if the particular companies the Funds invest in
do not perform well. All of the Munder Funds are subject to this risk.

Non-Diversified Risk is the risk of loss because a Fund that invests more of its
assets in fewer issuers than many other funds do, may be more susceptible to
adverse developments affecting any single issuer, and more susceptible to
greater losses because of these developments. For example, the Michigan Tax-Free
Bond Fund invests primarily in Michigan municipal obligations, if Michigan
issuers suffer serious financial difficulties, jeopardizing their ability to pay
their obligations, the Fund may suffer a loss. International Bond Fund, Michigan
Tax-Free Bond Fund and Tax-Free Short-Intermediate Bond Fund are subject to this
risk.

10
<PAGE>

Prepayment Risk is the risk that a Fund may experience losses when an issuer
exercises its right to pay principal on an obligation held by the Fund (such as
a mortgage-backed security) earlier than expected. This may happen during a
period of declining interest rates. Under these circumstances, the Fund may be
unable to recoup all of its initial investment and will suffer from having to
reinvest in lower yielding securities. The loss of higher yielding securities
and the reinvestment at lower interest rates can reduce the Fund's income, total
return and share price. Funds particularly subject to this risk are: Bond Fund,
Intermediate Bond Fund and U.S. Government Income Fund.

Who May Want to Invest

The Income Funds may be appropriate for investors:

. Looking for potentially higher returns and willing to accept greater risk
than more conservative fixed rate investments or money market funds.

. Looking for current income.

The Tax-Free Funds may be appropriate for investors:

. Looking primarily for tax-exempt income and comfortable with the risks
involved with income funds.

11
<PAGE>

Fees and Expenses

The tables below describe the fees and expenses that you may pay if you buy and
hold shares of the Funds. Please note that the following information does not
include fees that institutions may charge for services they provide to you.

<TABLE>
<CAPTION>
Class A Class B Class C
Shareholder Fees (fees paid directly from your investment) Shares Shares Shares
------ ------ ------
<S> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases........................... 4%(a) None None
Sales Charge (Load) Imposed on Reinvested Dividends........................ None None None
Maximum Deferred Sales Charge (Load)....................................... None(b) 5%(c) 1%(d)
Redemption Fees............................................................ None None None
Exchange Fees.............................................................. None None None
</TABLE>

Annual Fund Operating Expenses (expenses that are paid from Fund assets) And
Examples

Intermediate Bond Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
Management Fees .50% .50% .50% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====

International Bond Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------ ------ ------ ------ ------ ------ ------ ------
Management Fees .50% .50% .50% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
---- ---- ----
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
==== ==== ====
</TABLE>

12
<PAGE>

Michigan Tax-Free Bond Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- ------- -------- ------- --------

Management Fees .50% .50% .50% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
------- ------- ------
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======= ======= ======

Tax-Free Bond Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- ------- -------- ------- --------

Tax-Free Short-Intermediate Bond Fund
Class A Class B Class C Class A Class B Class B Class C Class C
Shares Shares Shares Shares Shares* Shares** Shares* Shares**
------- ------- ------- ------- ------- -------- ------- --------

Management Fees .50% .50% .50% 1 Year $ $ $ $ $
Distribution and/or
Service (12b-1) Fees .25% 1.00% 1.00% 3 Years $ $ $ $ $
Other Expenses [ ]% [ ]% [ ]% 5 Years $ $ $ $ $
-------- ------- -------
Total Annual Fund
Operating Expenses [ ]% [ ]% [ ]% 10 Years*** $ $ $ $ $
======== ======= =======
</TABLE>

_________________________
(a) The sales charge declines as the amount invested increases.
(b) A contingent deferred sales charge (CDSC) is a one-time fee charged at the
time of redemption. A 1% CDSC applies to redemptions of Class A shares within
one year of investment that were purchased with no initial sales charge as part
of an investment of $1,000,000 or more.
(c) The CDSC payable upon redemption of Class B shares declines over time.
(d) The CDSC applies to redemptions of Class C shares within one year of
purchase.
* Assumes you sold your shares at the end of the time period.
** Assumes you stayed in the Fund.
*** Reflects conversion of Class B shares to Class A shares (which pay lower
ongoing expenses) approximately six years after date of original purchase.

13
<PAGE>

More About The Funds
- ------------------------------------------------------------------------------

Glossary

Types Of Funds

Income Funds are the Bond Fund, Intermediate Bond Fund, International Bond Fund
and U.S. Government Income Fund. Tax-Free Funds are the Michigan Tax-Free Bond
Fund, Tax-Free Bond Fund and Tax-Free Short-Intermediate Bond Fund.

Types Of Securities

Rating Agencies And Indices

Moody's is Moody's Investor Services, Inc.

Duff & Phelps is Duff & Phelps Credit Rating Co.

Fitch is Fitch IBCA, Inc.

S&P is Standard & Poor's Rating Services.

Other

1940 Act is the Investment Company Act of 1940, as amended.

Internal Revenue Code is the Internal Revenue Code of 1986, as amended.

14
<PAGE>

Special Risks And Other Considerations

Investment Strategy. The Funds may use derivative instruments.
Derivatives can be used for hedging (attempting to reduce risk by
offsetting one investment position with another) or speculation (taking
a position in the hope of increasing return). The Funds may, but are
not required to, use derivatives for hedging purposes or for the
purpose of remaining fully invested or maintaining liquidity. The Funds
will not use derivatives for speculative purposes.

Investment Strategy. International Bond Fund will invest all or a
substantial portion of its total assets in foreign securities. The
other Income Funds may invest up to 25% of their total assets in
foreign securities. The Tax-Free Funds may invest up to 10% of their
total assets in foreign securities.

Investment in foreign securities may involve higher costs than
investment in U.S. securities, including higher transaction and custody
costs as well as the imposition of additional taxes by foreign
governments. Foreign investments may also involve risks associated with
the level of currency exchange rates, less complete financial
information about the issuers, less market liquidity, more market
volatility and political instability. Future political and economic
developments, the possible imposition of withholding taxes on dividend
income, the possible seizure or nationalization of foreign holdings,
the possible establishment of exchange controls or freezes on the
convertibility of currency, or the adoption of other governmental
restrictions might adversely affect an

15
<PAGE>

investment in foreign securities. Additionally, foreign issuers may be
subject to less stringent regulation, and to different accounting,
auditing and recordkeeping requirements.

Additional risks are involved when investing in countries with emerging
economies or securities markets. In general, the securities markets of
these countries are less liquid, are subject to greater price
volatility, have smaller market capitalizations and may have problems
with securities registration and custody. In addition, because the
securities settlement procedures are less developed in these countries,
a Fund may be required to deliver securities before receiving payment
and may also be unable to complete transactions during market
disruptions. As a result of these and other risks, investments in these
countries generally present a greater risk of loss to the Fund.

Investment Grade Credit Risk. A security is considered investment grade if, at
the time of purchase, it is rated:

. BBB or higher by S&P;
. Baa or higher by Moody's;
. BBB or higher by Duff & Phelps; or
. BBB or higher by Fitch.

A security will be considered investment grade if it receives one of the above
ratings, even if it receives a lower rating from other rating organizations.

Investment Strategy. Except as stated in the next section, fixed income
and convertible securities purchased by the Funds will generally be
rated at least investment grade. The Funds may also invest in unrated
securities if the advisor or believes they are comparable in quality.

Special Risks. Although securities rated "BBB" by S&P, Duff & Phelps or
Fitch, or Baa by Moody's are considered investment grade, they have
certain speculative characteristics. Therefore, they may be subject to
a higher risk of default than obligations with higher ratings.
Subsequent to its purchase by a Fund, a rated security may cease to be
rated or its rating may be reduced below the minimum rating required
for purchase by the Fund. The advisor will consider such an event in
determining whether the Fund should continue to hold the security.

Short-Term Trading. The Funds' historical portfolio turnover rates are shown in
the Financial Highlights.

Investment Strategy. The Funds may engage in short-term trading.

Special Risks. A high rate of portfolio turnover (100% or more) could
produce higher trading costs and taxable distributions, which could
detract from the Fund's performance.

Defensive Investing. Each Fund may invest all or any portion of its assets in
short-term obligations as a temporary defensive measure in response to adverse
market or economic conditions.

Special Risks. A Fund may not achieve its investment objective when its
assets are invested in short-term obligations.

16
<PAGE>

properly process and calculate date-related information and data from and after
January 1, 2000. The advisor is taking steps that it believes are reasonably
designed to address year 2000 computer-related problems with respect to the
computer systems that it uses and to obtain assurances that comparable steps are
being taken by the Funds' other major service providers. Although there can be
no assurances, the advisor believes that these steps will be sufficient to avoid
any adverse impact on any of the Funds. Similarly, there can be no assurance
that year 2000 issues will not affect the companies and other issuers in which
the Funds invest or affect worldwide markets and economies.

Additional Description Of Investments And Investment Strategies

Investment Strategy. All Income Funds may invest a portion of its
assets in Asset-Backed Securities.

Forward Currency Exchange Contracts. A forward currency exchange contract is an
obligation to exchange one currency for another on a future date at a specified
exchange rate.

Investment Strategy. Forward currency exchange contracts may be used
for hedging

17
<PAGE>

purposes and to help reduce the risks and volatility caused
by changes in foreign currency exchange rates. Foreign currency
exchange contracts will be used at the discretion of the advisor, and
no Fund is required to hedge its foreign currency positions.

Investment Strategy. Futures contracts and options on futures contracts
are traded on domestic or foreign exchanges or boards of trade. These
instruments may be used for hedging purposes, to maintain liquidity to
meet potential shareholder redemptions, to invest cash balances or
dividends, or to minimize trading costs.

Special Risks. Futures contracts and related options present the
following risks: imperfect correlation between the change in market
value of a Fund's securities and the price of futures contracts and
options; the possible inability to close a futures contract when
desired; losses due to unanticipated market movements, which are
potentially unlimited; and the possible inability of the advisor to
correctly predict the direction of securities prices, interest rates,
currency exchange rates and other economic factors.

Investment Strategy. The Income Funds may invest in guaranteed
investment contracts.

Special Risks. Guaranteed investment contracts are considered illiquid
investments and are acquired subject to a Fund's limitation on illiquid
investments.

Investment Strategy. Each Fund may invest up to 15% of its net assets
in securities that are illiquid.

18
<PAGE>

Investment Companies. To the extent consistent with their respective investment
objectives and policies, the Funds may invest in securities issued by other
investment companies.

Investment Strategy. Investments by a Fund in other investment
companies will be subject to the limitations of the 1940 Act.

Investment Strategy. The Tax-Free Funds will normally invest at least
80% of their net assets in municipal obligations.

Special Risks. Industrial revenue bonds depend on the credit standing
of a private issuer and may be subject to the federal alternative
minimum tax (AMT).

Investment Strategy. The Income Funds, Michigan Tax-Free Bond Fund and
Tax-Free Bond Fund may write (sell) covered call options, buy put
options, buy call options and write secured put options for hedging
purposes. Options may relate to particular securities, foreign or
domestic securities indices, financial instruments or foreign
currencies.

Special Risks. The value of options can be highly volatile, and their
use can result in loss if the advisor is incorrect in its expectation
of price fluctuations. The successful use of options for hedging
purposes also depends in part on the ability of the advisor to predict
future price fluctuations and the degree of correlation between the
options and securities markets.

Repurchase Agreements. Repurchase agreements involve the purchase of securities
by a Fund subject to the seller's agreement to repurchase them at a mutually
agreed upon date and price.

Investment Strategy. Each Fund may enter into repurchase agreements
with banks and broker-dealers that are deemed to be creditworthy by the
advisor.

Investment Strategy. Securities lending may represent no more than 25%
of the value of a Fund's total assets (including the loan collateral).

Special Risks. The main risk when lending Fund securities is that if
the borrower fails to return the securities or the invested collateral
has declined in value, the Fund could lose money.

Special Risks. Stripped securities are very sensitive to changes in
interest rates and to the rate of principal repayments. A rapid or
unexpected increase in mortgage

19
<PAGE>

prepayments could severely depress the price of certain stripped
mortgage-backed securities and adversely affect a Fund's total returns.

Investment Strategy. Each Fund may invest a portion of its assets in
short-term obligations pending investment or to meet anticipated
redemption requests. The Tax-Free Funds may hold uninvested cash if, in
the advisor's opinion, suitable tax-exempt securities are not
available. Each Tax-Free Fund may also invest a portion of its assets
in short-term money market instruments, the income from which is
subject to Federal income tax.

Special Risks. A Fund may not achieve its investment objective when its
asset are invested in short-term obligations.

Zero Coupon Bonds. These are securities issued at a discount from their face
value because interest payments are typically postponed until maturity.

20
<PAGE>

Your Investment
- -------------------------------------------------------------------------------

This section describes how to do business with the Funds.

How To Reach The Funds

By telephone: 1-800-438-5789
Call for shareholder services.

By mail: The Munder Funds
480 Pierce Street
Birmingham, MI 48009

Purchasing Shares

Class B and Class C shares of a Fund are sold at NAV next determined after a
purchase order is received in proper form.

Broker-dealers (other than the Funds' distributor) may charge you additional
fees for shares you purchase through them.

Policies for Purchasing Shares

Investment minimums
. Initial: $250

. Subsequent: $ 50

. Automatic Investment Plan: $ 50

Purchases over $250,000 must be for Class A or Class C shares.

Timing of orders
Purchase orders must be received by the Funds' distributor or transfer agent
before the close of regular trading on the New York Stock Exchange (normally,
4:00 p.m. Eastern time).

Methods for Purchasing Shares
Investors may purchase shares:
. By Broker. Any broker authorized by the Funds' distributor can sell you
shares of the Funds. Please note that brokers may charge you fees for their
services.

Boston Safe Deposit and Trust Company
Boston, MA
ABA# 011001234
DDA# 16-798-3
Account No.:

21
<PAGE>

You may make additional investments at any time using the wire procedures
described above. Note that banks may charge fees for transmitting wires.

. You may purchase shares through the Automatic Investment Plan.

. You may purchase shares through the Reinvestment Privilege.

Exchanging Shares

Policies for Exchanging Shares
. You may exchange Fund shares for shares of the same class of other Munder
Funds based on their relative net asset values.

. Class B and Class C shares will continue to age from the date of the
original purchase and will retain the same CDSC rate as they had before the
exchange.

. You must meet the minimum purchase requirements for the Munder Fund of that
you purchase by exchange.

. If you are exchanging into shares of a Munder Fund with a higher sales
charge, you must pay the difference at the time of the exchange.

. A share exchange is a taxable event and, accordingly, you may realize a
taxable gain or loss.

. Brokers may charge you a fee for handling exchanges.

. We may change, suspend or terminate the exchange privilege at any time. You
will be given notice of any material modifications except where notice is
not required.

. Exchanges By Mail. You may send exchange orders to your broker or you may
send them directly to the Funds' transfer agent at The Munder Funds, c/o
First Data Investor Services Group, P.O. Box 60428, King of Prussia,
Pennsylvania 19406-0428.

Redeeming Shares

Please see "Distribution Arrangements" below for information about CDSCs.

Policies for Redeeming Shares

. For your protection, a signature guarantee is required for the following
redemption requests: (a) redemption proceeds greater than $50,000; (b)
redemption proceeds not being made payable to the recordowner of the
account; (c) redemption proceeds not being mailed to the address of record
on the account or (d) if the redemption proceeds are being transferred to
another Munder Fund account with a different registration. You can obtain a
signature guarantee from a financial institution such as a commercial bank,
trust company, savings association or from a securities firm having
membership on a recognized securities exchange.

22
<PAGE>

Methods for Redeeming Shares
You may redeem shares of the Funds in several ways:

. By Telephone. You can redeem your shares by contacting your broker or
calling the Funds at (800) 438-5789. There is no minimum requirement for
telephone redemptions.

. You may redeem shares through the Automatic Withdrawal Plan.

. You can redeem a portion of your Class A shares of the Funds (except the
International Bond Fund) through the Free Checkwriting Privilege.

Additional Policies For Purchases, Exchanges And Redemptions

. We consider orders to be in "proper form" when all required documents
are properly completed, signed and received.

. The Funds reserve the right to reject any purchase order.

. At any time, the Funds may change any of their purchase or redemption
procedures, and may suspend the sale of their shares.

. The Funds may delay sending redemption proceeds for up to seven days,
or longer if permitted by the Securities and Exchange Commission.

. To limit the Funds' expenses, we do not currently issue share
certificates.

. A Fund may temporarily stop redeeming shares if:

. the New York Stock Exchange is closed;
. trading on the New York Stock Exchange is restricted;
. an emergency exists and the Fund cannot sell its assets or
accurately determine the value of its assets; or
. the Securities and Exchange Commission orders the Funds to suspend
redemptions.

. If accepted by a Fund, investors may purchase shares of the Fund with
securities that the Fund may hold. The advisor will determine if the
securities are consistent with the Funds' objectives and policies. If
accepted, the securities will be valued the same way the Fund values
portfolio securities it already owns. Call the Funds at (800) 438-5789
for more information.

23
<PAGE>

neither the Funds, the Funds' distributor nor the transfer agent will
be held responsible for any losses resulting from unauthorized
transactions.

. If you purchased shares directly from the Funds, the Funds' transfer
agent will send you confirmations of the opening of an account and of
all subsequent purchases, exchanges or redemptions in the account. If
your account has been set up by a broker or other investment
professional, account activity will be detailed in their statements to
you.

Shareholder Privileges

Free Checkwriting. Free checkwriting is available to holders of Class A shares
of the Funds (other than the International Bond Fund) who complete the signature
card section of the account application form. You may write checks in the amount
of $500 or more but you may not close a Fund account by writing a check. We may
change or terminate this program on 30 days' notice to you.

24
<PAGE>

Distribution Arrangements
- -------------------------------------------------------------------------------

Share Class Selection

Class A shares
. Front end sales charge. There are several ways to reduce these sale charges.
. Lower annual expenses than Class B and Class C shares.

Class B shares
. No front end sales charge. All your money goes to work for you right away.
. Higher annual expenses than Class A shares.
. A CDSC on shares you sell within six years of purchase.
. Automatic conversion to Class A shares approximately six years after
issuance, thus reducing future annual expenses. o CDSC is waived for certain
redemptions.

Class C shares
. No front end sales charge or CDSC, except for a CDSC for redemptions made
within the first year after investing. All your money goes to work for you
right away.
. Shares do not convert to another class.
. Higher annual expenses than Class A shares.

Applicable Sales Charge- Class A Shares

You can purchase Class A shares at NAV plus an initial sales charge. The sales
change as a percentage of your investment decreases as the amount you invest
increases. The current sales charge rates and commissions paid to selected
dealers as follows:

Discount to
Selected
Sales Charge as a Dealers as a
Percentage of Percentage
-------------
Your Net Asset of
Investment Value Investment
---------- ----- ----------
Less than 4.00% 4.17% 3.75%
$100,000............
$100,000 but less
than $250,000....... 3.00% 3.09% 2.75%
$250,000 but less
than $500,000....... 2.00% 2.04% 1.75%
$500,000 but less
than $1,000,000..... 1.25% 1.27% 1.00%
$1,000,000 or
more................ None* None* (see below)**

- --------------------
* No initial sales charge applies on investments of $1 million or more. However,
a CDSC of 1% is imposed on certain redemptions within one year of purchase.
**The Distributor will pay 1% commission to dealers who initiate and are
responsible for purchases of $1 million or more.

Sales Charge Waivers - General
We will waive the initial sales charge on Class A shares for the following types
of purchasers:

1. individuals with an investment account or relationship with the advisor;

2. full-time employees and retired employees of the advisor, employees of the
Funds' service providers and immediate family members of such persons;

3. registered broker-dealers that have entered into selling agreements with the
Fund's 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 below;

5. individuals who reinvest a distribution from a qualified retirement plan for
which the advisor serves as investment advisor;

6. individuals who reinvest the proceeds of redemptions from Class Y Shares of
another Munder Fund, within 60 days of redemption;

7. banks and other financial institutions that have entered into agreements with
the Munder Funds to

25
<PAGE>

provide shareholder services for 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

Sales Charge Waivers - Qualified Employer Sponsored Retirement Plans
We will waive the initial sales charge on purchases of Class A shares by
employer sponsored retirement plans that are qualified under Section 401(a) or
Section 403(b) of the Internal Revenue Code (each, a Qualified Employee Benefit
Plan) and that (1) invest $1,000,000 or more in Class A shares offered by The
Munder Funds or (2) have at least 75 eligible plan participants.

Merrill Lynch Plans. We will waive the initial sales charge for all
investments by Merrill Lynch Plans if

(i) the Plan is recordkept on a daily valuation basis by Merrill Lynch Group
Employee Services (Merrill Lynch) and, on the date the plan sponsor signs
the Merrill Lynch Recordkeeping Service Agreement, the Plan has $3
million or more in assets invested in broker/dealer funds not advised or
managed by Merrill Lynch Asset Management, L.P. (MLAM) that are made
available pursuant to a Services Agreement between Merrill Lynch and the
Fund's distributor and in funds advised or managed by MLAM (collectively,
the Applicable Investments); or

(ii) the Plan is recordkept on a daily valuation basis by an independent
recordkeeper whose services are provided through a contract or alliance
arrangement with Merrill Lynch, and on the date the plan sponsor signs
the Merrill Lynch Recordkeeping Service Agreement, the Plan has $3
million or more in assets, excluding money market funds, invested in
Applicable Investments; or

(iii) the Plan has 500 or more eligible employees, as determined by the Merrill
Lynch plan conversion manager, on the date the plan sponsor signs the
Merrill Lynch Recordkeeping Service Agreement.

For further information on sales charge waivers, call (800) 438-5789.

Sales Charge Reductions
You may qualify for reduced sales charges in the following cases:

. Letter of Intent. If you intend to purchase at least $100,000 of Class A
shares of the Funds you may wish to complete the Letter of Intent section
of your account application form. By doing so, you agree to invest a
certain amount over a 13-month period. You would pay a sales charge on any
Class A shares you purchase during the 13 months based on the total amount
to be invested under the Letter of Intent. You can apply any investments
you made in any of the Munder Funds during the preceding 90-day period
toward fulfillment of the Letter of Intent (although there will be no
refund of sales charges you paid during the 90-day period). You should
inform the Funds' transfer agent that

26
<PAGE>

you have a Letter of Intent each time you make an investment.

You are not obligated to purchase the amount specified in the Letter of
Intent. If you purchase less than the amount specified, however, you must
pay the difference between the sales charge paid and the sales charge
applicable to the purchases actually made. The Funds' custodian will hold
such amount in escrow. The custodian will pay the escrowed funds to your
account at the end of the 13 months unless you do not complete your
intended investment.

Certain brokers may not offer these programs or may impose conditions or fees to
use these programs. You should consult with your broker prior to purchasing the
Funds' shares.

For further information on sales charge reductions, call (800) 438-5789.

Cdsc

You pay a CDSC when you redeem:
. Class A shares that were bought as part of an investment of at least $1
million within one year of buying them;
. Class B shares within six years of buying them;
. Class C shares within one year of buying them.

These time periods include the time you held Class B or Class C shares of
another Munder Fund which you may have exchanged for Class B or Class C shares
of the Fund you are redeeming.

You will not pay a CDSC to the extent that the value of the redeemed shares
represents:
. reinvestment of dividends or capital gains distributions; or
. capital appreciation of shares redeemed.

CDSC Waivers
We will waive the CDSC payable upon redemptions of shares which you purchased
after June 27, 1995 (or acquired through an exchange of shares of another Munder
Fund purchased after June 27, 1995) for:
. redemptions made within one year after the death of a shareholder or
registered joint owner;
. minimum required distributions made from an IRA or other retirement plan
account after you reach age 70 1/2;
. involuntary redemptions made by the Fund;
. redemptions limited to 10% per year of an account's net asset value. For
example, if you maintain an annual balance of $10,000 you can redeem up to
$1,000 annually free of charge.

We will waive the CDSC payable upon redemptions of shares which you purchased
after December 1, 1998 (or acquired through an exchange of shares of

27
<PAGE>

another Munder Fund purchased after December 1, 1998) for:
. redemptions made from an IRA or other individual retirement plan account
established through Comerica Securities, Inc. after you reach age 59 1/2
and after the eighteen month anniversary of the purchase of Fund shares.

We will waive the CDSC for Class B shares for all redemptions by Merrill Lynch
Plans if:

12b-1 Fees

The Funds have adopted Rule 12b-1 plans with respect to their Class A, Class B
and Class C shares that allow the Funds to pay distribution and other fees for
the sale of its shares and for services provided to shareholders. Under the
plans, the Funds may pay up to .25% of the daily net assets of Class A, Class B
and Class C shares to pay for certain shareholder services provided by
institutions that have agreements with the Funds' distributor to provide such
services. The Funds may also pay up to .75% of the daily net assets of the Class
B and Class C shares to finance activities relating to the distribution of its
shares.

Because the fees are paid out of each Fund's assets on an on-going basis, over
time these fees will increase the cost of an investment in a Fund and may cost a
shareholder more than paying other types of sales charges.

Other Information

The advisor may, from time to time, make payments to banks, broker-dealers or
other financial institutions for certain services to the Funds and/or their
shareholders, including sub-administration, sub-transfer agency and shareholder
servicing. The advisor may make such payments out of its own resources and there
are no additional costs to the Funds or their shareholders.

Please note that Comerica Bank, an affiliate of the advisor, receives a fee from
the Funds for providing shareholder services to its customers who own shares of
the Funds.

28
<PAGE>

Pricing Of Fund Shares
- -------------------------------------------------------------------------------

Each Fund's NAV is calculated on each day the New York Stock Exchange is open.
NAV is the value of a single share of a Fund. Each Fund calculates NAV
separately for each class. NAV is calculated by (1) taking the current value of
a Fund's total assets allocated to a particular class of shares, (2) subtracting
the liabilities and expenses charged to that class (3) dividing that amount by
the total number of shares of that class outstanding.

The Funds calculate NAV as of the close of business on the New York Stock
Exchange, normally 4:00 p.m. (Eastern time). If the New York Stock Exchange
closes early, the Funds will accelerate calculation of NAV and transaction
deadlines to that time.

The NAV of each Fund is generally based on the market value of the securities
held by in the Fund. If market values are not available, the fair value of
securities is determined in good faith by, or using procedures approved by, the
Boards of Directors/Trustees of the Funds.

Distributions
- -------------------------------------------------------------------------------

As a shareholder, you are entitled to your share of a Fund's net income and
gains on its investments. Each Fund passes substantially all of its earnings
along to its shareholders as distributions. When a Fund earns dividends from
stocks and interest from debt securities and distributes these earnings to
shareholders, it is called a dividend distribution. A Fund realizes capital
gains when it sells securities for a higher price than it paid. When these gains
are distributed to shareholders, it is called a capital gain distribution.

Bond Fund, Intermediate Bond Fund, U.s. Government Income Fund, Michigan Tax-
Free Bond Fund, Tax-free Bond Fund And Tax-free Short-intermediate Bond Fund
These Funds pay dividends, if any, monthly.

International Bond Fund
This Fund pays dividends, if any, quarterly.

All Funds

Each Fund distributes its net realized capital gains, if any, at least annually.

Each Fund normally will pay distributions in additional shares of that Fund. If
you wish to receive distributions in cash, either, indicate this request on your
account application form or notify the Funds by calling (800) 438-5789.

29
<PAGE>

Federal Tax Considerations
- ------------------------------------------------------------------------------

Taxes On Distributions

You will generally have to pay federal income tax on all Fund distributions.
Distributions will be taxed in the same manner whether you receive the
distributions in cash or in additional shares of the Fund. The Tax-Free Funds
expect that a portion of their dividend distributions will be exempt from
federal income tax. Shareholders not subject to tax on their income generally
will not be required to pay any tax on distributions.

Distributions are generally taxable to you in the year in which they are paid,
with one exception: distributions declared in October, November or December, but
not paid until January of the following year, are taxed as though they were paid
on December 31 in the year in which they were declared.

If a Fund invests in certain "passive foreign investment companies" ("PFICs"),
it will be subject to Federal income tax (and possibly additional interest
charges) on a portion of any "excess distribution" or gain from the disposition
of such shares, even if it distributes such income to its shareholders. If a
Fund elects to treat PFIC as a "qualified electing fund" ("QEF") and the PFIC
furnishes certain financial information in the required form to such Fund, the
Fund will instead be required to include in income each year its allocable share
of the ordinary earnings and net capital gains of the QEF, regardless of whether
received, and such amounts will be subject to the various distribution
requirements described above. The Funds may also elect to mitigate the tax
effects of owning PFIC stock by making an annual mark-to-market election with
respect to PFIC shares.

Taxes On Sales Or Exchanges

If you sell shares of a Fund or exchange them for shares of another Munder Fund,
you generally will be subject to tax on any taxable gain. Taxable gain is
computed by subtracting your tax basis in the shares from the redemption
proceeds (in the case of a sale) or the value of the shares received (in the
case of an exchange). Because your tax basis depends on the original purchase
price and on the price at which any dividends may have been reinvested, you
should be sure to keep account statements so that you or your tax preparer will
be able to determine whether a sale or an exchange will result in a taxable
gain.

Other Considerations

If you buy shares of a Fund just before the Fund makes any distribution, you
will pay the full price for the shares and then receive back a portion of the
money you just invested in the form of a taxable distribution.

If you have not provided complete, correct taxpayer information by law the Funds
must withhold a portion of your distributions and redemption proceeds to pay
federal income taxes.

30
<PAGE>

Management
- --------------------------------------------------------------------------------

Investment Advisor

The Funds' investment advisor is Munder Capital Management ("MCM"), 480 Pierce
Street, Birmingham, Michigan 48009. As of September 30, 1999, the advisor and
its affiliates had approximately $__ billion in assets under management, of
which $__ billion were invested in equity securities, $__ billion were invested
in money market or other short-term instruments, $__ billion were invested in
other fixed income securities, and $__ billion in non-discretionary assets.

The advisor provides overall investment management for the Funds, provides
research and credit analysis and is responsible for all purchases and sales of
portfolio securities.

During the fiscal year ended June 30, 1999, the advisor was paid an advisory fee
at an annual rate of 0.50% of the average daily net assets of each Fund.

Portfolio Management

Bond Fund
James C. Robinson and Gregory A. Prost jointly manage the Fund. Mr. Robinson and
Mr. Prost have managed the Fund since March 1995 and May 1995, respectively. Mr.
Robinson has been a Vice President and Chief Investment Officer of MCM or Old
MCM since 1987. Mr. Prost has been a Senior Fixed Income Portfolio of MCM or Old
MCM since 1995. Prior to joining MCM, he was a Vice President and Senior Fund
Manager for First of America Investment Corp.

Intermediate Bond Fund
Anne K. Kennedy and James C. Robinson jointly manage the Fund. Ms. Kennedy, Vice
President and Director of Corporate Bond Trading of MCM or Old MCM since 1991,
has managed the Fund since March 1995. Mr. Robinson, Vice President and Chief
Investment Officer of MCM or Old MCM since 1987, has managed the Fund since
March 1995.

International Bond Fund
Gregory A. Prost and Sharon E. Fayolle jointly manage the Fund. Mr. Prost,
Senior Fixed Income Portfolio Manager of MCM or Old MCM, has managed the Fund
since October 1996. Prior to joining MCM in 1995, he was a Vice President and
Senior Fund Manager for First of America Investment Corp. Ms. Fayolle, Vice
President and Director of Money Market Trading for MCM or Old MCM, has managed
the Fund since 1996. Prior to that she managed an international portfolio for
Ford Motor Company.

U.S. Government Income Fund
James C. Robinson and Peter G. Root jointly manage the Fund. Mr. Robinson, Vice
President and Chief Investment Officer of MCM or Old MCM since 1987, and Mr.
Root, Vice President and Director of Government Securities Trading of MCM since
March 1995, have managed the Fund since March 1995. Mr. Root joined MCM in 1991.

Michigan Tax-free Bond Fund, Tax-free Bond Fund And Tax-free Short-intermediate
Bond Fund
Talmadge D. Gunn, Vice President and Director of Tax-Exempt Trading of MCM since
1993, manages the Tax-Free Funds.

31
<PAGE>

Financial Highlights
- -------------------------------------------------------------------------------

The financial highlights table is intended to help shareholders understand each
Fund's financial performance for the past 5 years (or, if shorter, the period of
the Fund's operations). Certain information reflects financial results for a
single Fund share. The total returns in the table represent the rate that an
investor would have earned (or lost) on an investment in a Fund (assuming
reinvestment of all dividends and distributions). The information has been
audited by Ernst & Young LLP, independent accountants, whose report, along with
each Fund's financial statements, are included in the annual reports of the
Funds, and are incorporated by reference into the Statement of Additional
Information. You may obtain the annual reports without charge by calling
(800) 438-5789.

<TABLE>
<CAPTION>
Bond Fund (a)
-----------------------------------------------------------
Year Year Year Year Year
Ended Ended Ended Ended Ended
6/30/99 6/30/98(e) 6/30/97 6/30/96 6/30/95(d)
Class A Class A Class A Class A Class A
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period............................
Income from investment operations:
Net investment income...........................................
Net realized and unrealized gain/(loss) on
investments.....................................................
Total from investment operations................................
Less distributions:
Dividends from net investment income............................
Distributions from net realized gains...........................
Total distributions.............................................
Net asset value, end of period..................................
Total return (b)................................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)............................
Ratio of operating expenses to average net assets...............
Ratio of net investment income to average net assets............
Portfolio turnover rate.........................................
Ratio of operating expenses to average net assets without
waivers.........................................................
</TABLE>

_____________________

32
<PAGE>

<TABLE>
<CAPTION>
Bond Fund (a)
- ---------------------------------------------------------------------------------------------------------------
Year Year Year Year Period Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended
2/28/95(e,f) 6/30/99 6/30/98(e) 6/30/97 6/30/96 6/30/99 6/30/98(e) 6/30/97 6/30/96
Class A Class B Class B Class B Class B Class C Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

33
<PAGE>

<TABLE>
<CAPTION>
Intermediate Bond Fund (a)
-------------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96 6/30/95(d) 2/28/95(e)
Class A Class A Class A Class A Class A Class A
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......
Income from investment operations:
Net investment income......................
Net realized and unrealized gain/(loss) on
investments................................
Total from investment operations...........
Less distributions:
Dividends from net investment income.......
Distributions from net realized gains......
Total distributions........................
Net asset value, end of period.............
Total return (b)...........................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).......
Ratio of operating expenses to average net
assets.....................................
Ratio of net investment income to
average net assets.........................
Portfolio turnover rate....................
Ratio of operating expenses to
average net assets without waivers.........
</TABLE>

_____________

34
<PAGE>

<TABLE>
<CAPTION>
Intermediate Bond Fund (a)
- ----------------------------------------------------------------------------------------------------------------------
Year Year Year Year Period Period Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98(f) 6/30/97(f) 6/30/96 6/30/95(d) 2/28/95(e) 6/30/99 6/30/98(f) 6/30/97(f) 6/30/96
Class B Class B Class B Class B Class B Class B Class C Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

35
<PAGE>

<TABLE>
<CAPTION>
International Bond Fund (a)
--------------------------------------------------------------------------
Year Year Period Year Year Period Year Period
Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/99 6/30/98 6/30/97 6/30/99 6/30/98
Class A Class A Class A Class B Class B Class B Class C Class C
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...............
Income from investment operations:
Net investment income..............................
Net realized and unrealized gain/(loss) on
investments........................................
Total from investment operations...................
Less distributions:
Dividends from net investment income...............
Distributions from net realized gains..............
Total distributions................................
Net asset value, end of period.....................
Total return (b)...................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...............
Ratio of operating expenses to average net assets..
Ratio of net investment income to average net assets
Portfolio turnover rate............................
Ratio of operating expenses to average net
assets without waivers.............................
</TABLE>

_______________

36
<PAGE>

<TABLE>
<CAPTION>
U.S. Government Income Fund(a)
- -------------------------------------------------------------------------------------------------------------------------------
Year Period Year Year Period Year Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96(f) 6/30/95(d) 2/28/95(e) 6/30/99 6/30/98 6/30/97 6/30/96(f)
Class A Class A Class A Class A Class A Class A Class B Class B Class B Class B
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

37
<PAGE>

<TABLE>
<CAPTION>
U.S. Government Income Fund (a) Michigan Tax-Free Bond Fund (a)
----------------------------------- -----------------------------------------
Year Period Period Year Year Period Year
Ended Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/99 6/30/98 6/30/97(e) 6/30/96(e)
Class C Class C Class C Class A Class A Class A Class A
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period................
Income from investment operations:
Net investment income...............................
Net realized and unrealized gain/(loss) on
investments.........................................
Total from investment operations....................
Less distributions:
Dividends from net investment income................
Distributions from net realized gains...............
Total distributions.................................
Net asset value, end of period......................
Total return (b)....................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)................
Ratio of operating expenses to average net assets...
Ratio of net investment income to average net assets
Portfolio turnover rate.............................
Ratio of operating expenses to average net
assets without waivers..............................
</TABLE>
_________

38
<PAGE>

<TABLE>
<CAPTION>
Michigan Tax-Free Bond Fund (a)
- -----------------------------------------------------------------------------------------------------------------------------------
Period Year Year Year Year Year Period Period Year Year Period
Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended
6/30/95(d,e) 2/28/95(e,f) 6/30/99 6/30/98 6/30/97(e) 6/30/96(e) 6/30/95(d,e) 2/28/95(e,f) 6/30/99 6/30/98 6/30/97(e)
Class A Class A Class B Class B Class B Class B Class B Class B Class C Class C Class C
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>

39
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Bond Fund (a)
----------------------------------------------------------------------
Year Year Year Period Year Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(e) 6/30/96(e) 6/30/99 6/30/98
Class A Class A Class A Class A Class B Class B
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period........................
Income from investment operations:
Net investment income.......................................
Net realized and unrealized gain/(loss) on investments.....
Total from investment operations............................
Less distributions:
Dividends from net investment income........................
Distributions from net realized gains.......................
Total distributions.........................................
Net asset value, end of period..............................
Total return (b)............................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)........................
Ratio of operating expenses to average net assets...........
Ratio of net investment income to average net assets........
Portfolio turnover rate.....................................
Ratio of operating expenses to average net
assets without waivers....................................
</TABLE>

40
<PAGE>

Tax-Free Bond Fund (a)
- -------------------------------------------------------------------------------
Year Year Period Period Year Period
Ended Ended Ended Ended Ended Ended
6/30/97(e) 6/30/96(e) 6/30/95(d,e) 2/28/95(f) 6/30/99 6/30/98
Class B Class B Class B Class B Class C Class C
------- ------- ------- ------- ------- -------

41
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Short-Intermediate Bond Fund (a)
---------------------------------------------------------------
Year Year Year Year Period
Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/95(d)
Class A Class A Class A Class A Class A
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period........................
Income from investment operations:
Net investment income.......................................
Net realized and unrealized gain/(loss) on investments.....
Total from investment operations............................
Less distributions:
Dividends from net investment income........................
Distributions from net realized gains.......................
Total distributions.........................................
Net asset value, end of period..............................
Total return (b)............................................

42
<PAGE>

Tax-Free Short-Intermediate Bond Fund (a)
- --------------------------------------------------------------------------------
Year Year Year Year Period Period
Ended Ended Ended Ended Ended Ended
2/28/95(e) 6/30/99 6/30/98 6/30/97(f) 6/30/96(f) 6/30/99
Class A Class A Class B Class B Class B Class C
------- ------- ------- ------- ------- -------

____________________

43
<PAGE>

For More Information

<TABLE>
<CAPTION>
To Obtain Information:
------------------------------------------------
<S> <C>
More information about the Funds is available free upon request,
including the following: By telephone
Call 1-800-438-5789
Annual/Semi-Annual Reports
By mail
You will receive unaudited semi-annual reports and audited annual reports on a The Munder Funds
regular basis from the Funds. In addition, you will By mail also receive updated 480 Pierce Street
prospectuses or supplements to this The Munder Funds prospectus. In order to Birmingham, MI 48009
eliminate duplicate mailings, the Funds 480 Pierce Street will only send one
copy of the above communications to (1) accounts Birmingham, MI 48009 with the On the Internet
same primary record owner, (2) joint tenant accounts, (3) Text-only versions of fund documents can be
tenant in common accounts and (4) accounts which have the same viewed online or downloaded from:
address.
Securities and Exchange Commission
Statement of Additional Information http://www.sec.gov

Provides more details about the Funds and their policies. A current You can also obtain copies by visiting the
Statement of Additional Information is on file with the Securities Securities and Exchange Commission's Public
and Exchange Commission and is incorporated by reference (is legally Reference Room in Washington, D.C. (phone
considered part of this prospectus). 1-800-SEC-0330) or by sending your request and
a duplicating fee to the Securities and
Exchange Commission's Public Reference Section,
Washington, D.C. 20549-6009.

You may also find more information about the
Funds on the Internet at:
http://www.munderfunds.com
------------------------------------------------
</TABLE>

The Munder Funds, Inc.
SEC file number: 811-7346

The Munder Funds Trust
SEC file number: 811-5899
<PAGE>

Class A, B & C Shares

[Munder Logo]
Prospectus

October 26, 1999

The Munder Money Market Funds
Cash Investment
Money Market
Tax-Free Money Market
U.S. Treasury Money Market

As with all mutual funds, the Securities and
Exchange Commission has not approved or
disapproved these securities nor passed upon
the accuracy or adequacy of this prospectus.
It is a criminal offense to state otherwise.
<PAGE>

Table Of Contents

2 Risk/Return Summary

Cash Investment Fund
2 Goal
2 Principal Investment Strategies
2 Principal Risks
Money Market Fund And Tax-Free Money Market Fund
3 Goal
3 Principal Investment Strategies
3 Principal Risks
U.S. Treasury Money Market Fund
4 Goal
4 Principal Investment Strategies
4 Principal Risks

4 Who May Want To Invest
5 Performance
8 Fees And Expenses

10 More About The Funds

13 Your Investment
13 How To Reach The Funds
13 Purchasing Shares
14 Exchanging Shares
14 Redeeming Shares
15 Additional Policies For Purchases, Exchanges And Redemptions
16 Shareholder Privileges

17 Distribution Arrangements
17 CDSC
18 12B-1 Fees
18 Other Information

19 Pricing Of Fund Shares

19 Distributions

20 Federal Tax Considerations
20 Taxes On Distributions
20 Taxes On Sales Or Exchanges
20 Other Considerations

21 Management
21 Investment Advisor
21 Portfolio Managers

22 Financial Highlights

Back Cover For Additional Information
<PAGE>

Risk/Return Summary
- --------------------------------------------------------------------------------

This Risk/Return Summary briefly describes the goals and principal investment
strategies of the Funds and the principal risks of investing in the Funds. For
further information on the Funds' principal investment strategies and risks,
please read the section entitled More About The Funds. Each Fund may also use
other investment techniques to achieve its goal. For information on these
techniques and their related risks, please read the Statement of Additional
Information.

An investment the Funds is not a bank deposit and is not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other governmental agency.

Cash Investment Fund

Goal

The Fund's primary goal is to provide as high a level of current interest income
as is consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing in a broad range of U.S. dollar-
denominated money market instruments.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

The Fund's investments may include fixed and variable rate securities.

The Fund may also invest in foreign securities, guaranteed investment contracts,
stripped securities, asset-backed securities, enter into repurchase agreements
and lend its portfolio securities.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

The principal risks of investing in the Fund are:

Interest Rate Risk is the risk that increases in prevailing interest rates will
cause fixed-income securities held by the Fund to decline in value. Longer term
bonds are generally more sensitive to interest rate changes than shorter term
bonds. Generally, the longer the average maturity of the bonds held by the
Fund, the more the Fund's share price will fluctuate in response to interest
rate changes.

Foreign Securities Risk is the risk of loss because investments by the Fund in
foreign securities may experience greater and more rapid change in value than
investments in U.S. securities. Foreign securities are generally more volatile
and less liquid than U.S. securities, in part because of greater political and
economic risks and because there is less public information available about
foreign companies. Issuers of foreign securities are generally not subject to
the same degree of regulation as are U.S. issuers. The reporting, accounting
and auditing standards of foreign countries may differ, in some cases
significantly, from U.S. standards.

Prepayment Risk is the risk that the Fund may experience losses when an issuer
exercises its right to pay principal on an obligation held by the Fund (such as
a mortgage-backed security) earlier than expected. This may happen during a
period of declining interest rates. Under these circumstances, the Fund may be
unable to recoup all of its initial investment and will suffer from having to
reinvest in lower yielding securities. The loss of higher yielding securities
and the reinvestment at lower interest rates can reduce the Fund's income, total
return and share price.

Further information about the Fund's principal investment strategies and risks
is provided below under "More About the Funds."

2
<PAGE>

Money Market Fund

Goal

The Fund's primary goal is to provide as high a level of current interest income
as is consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing in a broad range of U.S. dollar-
denominated money market instruments.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

The Fund's investments may include fixed and variable rate securities.

The Fund may also invest in foreign securities, guaranteed investment contracts,
stripped securities, asset-backed securities, enter into repurchase agreements
and lend its portfolio securities.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

The principal risks of investing in the Fund are:

Further information about the Fund's principal investment strategies and risks
is provided below under "More About the Funds."

Tax-Free Money Market Fund

Goal

The Fund's goal is to provide as high a level of current interest income exempt
from Federal income taxes as is consistent with maintaining liquidity and
stability of principal.

Principal Investment Strategies

The Fund pursues its goal by investing substantially all of its assets in short-
term, U.S. dollar-denominated municipal obligations, the interest on which is
exempt from regular Federal income tax.

Under normal market conditions, the Fund will invest at least 80% of its net
assets in municipal obligations.

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

The Fund's investments may include fixed and variable rate and zero coupon
securities. The Fund may also invest in other investment companies and lend its
portfolio securities.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

The principal risks of investing in the Fund are:

3
<PAGE>

Generally, the longer the average maturity of the bonds held by the
Fund, the more the Fund's share price will fluctuate in response to interest
rate changes.

Further information about the Fund's principal investment strategies and risks
is provided below under "More About the Funds."

U.S. Treasury Money Market Fund

Goal

The Fund's goal is to provide as high a level of current interest income as is
consistent with maintaining liquidity and stability of principal.

Principal Investment Strategies

The Fund invests solely in U.S. dollar-denominated debt securities with
remaining maturities of 13 months or less and maintains an average dollar-
weighted portfolio maturity of 90 days or less.

The Fund may also lend its portfolio securities.

Principal Risks

Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.

The principal risk of investing in the Fund is:

Further information about the Fund's principal investment strategies and risks
is provided below under "More About the Funds."

Who May Want To Invest

. The Funds may be appropriate for investors who desire a high level of income
and liquidity and stability of principal.

. The Money Market Fund is also designed to be acquired by the exchange of
shares of other Munder Funds for investors who own other Munder Funds, wish
to be out of the market temporarily and do not desire to incur redemption
fees or sales charges.

The Funds alone cannot provide a balanced investment program.

4
<PAGE>

Performance

The bar charts and tables below give some indication of: (a) the variability of
the Funds' returns by showing changes in each Fund's performance from year to
year over the life of the Fund; and (b) the risk of an investment in a Fund by
showing how each Fund's average annual total returns over different calendar
periods compare to those of a broad based securities market index.

When you consider this information, please remember a Fund's performance in past
years is not necessarily an indication of how a Fund will perform in the future.

Cash Investment Fund

[BAR CHART]

Calendar Year Total Return (Class A)

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

- ---------------------
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)
Since
Class- Inception Date 1 Year 5 Years Inception
- ---------------------- ------------ ------------ -----------
Class A (12/1/92)
[Index] *

Since inception of Class ___**

*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

You may call 1-800-[ ] to obtain the Fund's current 7-day yield.

Money Market Fund

[BAR CHART]

Calendar Year Total Return (Class B)

The annual returns in the bar chart are for the Fund's Class B Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

5
<PAGE>

1995: _____%
1996: _____%
1997: _____%
1998: _____%

- ----------------
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Return
(for the periods ended December 31, 1998)

Since
Class- Inception Date 1 Year Inception
- ---------------------- ------------ -----------
Class A (7/3/95)
Class B (2/16/94)
[Index] *

Since inception of Class ___**
Since inception of Class ___**

- ------------------
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum contingent
deferred sales charge and conversion of Class B shares to Class A shares after
the applicable period.

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

Tax-Free Money Market Fund

[BAR CHART]

Calendar Year Total Return (Class A)

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

- -------------------
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Since inception of Class ___**

- -------------------
*Index return from __/__/9__

6
<PAGE>

**Index return from month-end of applicable class inception date.

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

U.S. Treasury Money Market Fund

[BAR CHART]

Calendar Year Total Return (Class A)

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%

- -------------------
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Since inception of Class ___**

- --------------
*Index return from __/__/9__
**Index return from month-end of applicable class inception date.

You may call 1-800 [ ] to obtain the Fund's current 7-day yield.

7
<PAGE>

Fees And Expenses

<TABLE>
<CAPTION>
Cash Investment Fund
Tax-Free Money Market Fund
U.S. Treasury Money Market Fund Money Market Fund
------------------------------- -----------------
<S> <C> <C> <C> <C>
Shareholder Fees
(fees paid directly from your Class A Class A Class B Class C
investment) Shares Shares Shares Shares
- ----------------------------- ------- ------- ------- -------
Maximum Sales Charge (Load)
Imposed on Purchases............. None None None None
Sales Charge (Load) Imposed on
Reinvested Dividends............. None None None None
Maximum Deferred Sales Charge
(Load)........................... None None(a) 5%(b) 1%(c)
Redemption Fees.................. None None None None
Exchange Fees.................... None None None None
</TABLE>

Annual Fund Operating Expenses (expenses that are paid from Fund assets) And
Examples

The examples are intended to help you compare the cost of investing in each Fund
to the cost of investing in other mutual funds. The examples assume that you
invest $10,000 in each Fund for the time periods indicated. The examples also
assume that your investment has a 5% return each year, that each Fund's
operating expenses remain the same as shown in the table and that all dividends
and distributions are reinvested. Your actual costs and the return on your
investment may be higher or lower.

<TABLE>
<CAPTION>
Cash Investment Fund
Class A Class A
Shares Shares
------- -------
<S> <C> <C>
Management Fees .35% 1 Year
Distribution and/or
Service (12b-1) Fees .25% 3 Years
Other Expenses [ ]% 5 Years
-----
Total Annual Fund
Operating Expenses [ ]% 10 Years
-----
</TABLE>

8
<PAGE>

<TABLE>
<CAPTION>
Annual Fund Operating Expenses
as a % of net assets Examples
- ------------------------------------------------------------------------------ ---------------------------------------------------
Tax-Free Money Market Fund
Class A Class A
Shares Shares
------- -------
<S> <C> <C>
Management Fees .35% 1 Year
Distribution and/or Service .25%
(12b-1) Fees 3 Years
Other Expenses [ ]% 5 Years
-----
Total Annual Fund
Operating Expenses [ ]% 10 Years
-----
</TABLE>

U.S. Treasury Money Market Fund

<TABLE>
<CAPTION>
Class A Class A
Shares Shares
------- -------
<S> <C> <C> <C>
Management Fees .35% 1 Year
Distribution and/or Service .25%
(12b-1) Fees 3 Years
Other Expenses [ ]% 5 Years
-----
Total Annual Fund
Operating Expenses [ ]% 10 Years
-----
</TABLE>
- -------------------
(a) A contingent deferred sales charge(CDSC) is a one-time fee charged at the
time of redemption. A 1% CDSC applies to redemptions of shares acquired
through the exchange of Class A shares of other funds purchased on or after
June 27, 1995 as part of an investment of $1,000,000 or more.
(b) The CDSC payable on redemption of Class B shares declines over time.
(c) The CDSC applies to redemptions within one year after the initial
investment in Class C shares.
* Assumes you sold your shares at the end of the time period.
** Assumes you stayed in the Fund.
*** Reflects conversion of Class B shares to Class A shares (which pay lower
ongoing expenses) approximately six years after date of original purchase.

9
<PAGE>

More About The Funds
- --------------------------------------------------------------------------------

The Funds' principal investments, strategies and risks are summarized above in
the section entitled Risk/Return Summary. Below is further information about
the Funds' principal investment strategies and their associated risks. The
Funds may also use techniques and invest in securities described in the
Statement of Additional Information.

Municipal Obligations are obligations of states, territories and possessions of
the United States and the District of Columbia, and their political
subdivisions, agencies, instrumentalities and authorities. They may be payable
from the issuer's general revenue, the revenue of a specific project, current
revenues or a reserve fund.

Foreign Securities. The Cash Investment Fund and the Money Market Fund may
invest up to 25% of total assets in U.S. dollar denominated money market
securities of foreign issuers, which include securities issued by foreign
companies and foreign governments and their agencies, instrumentalities or
political subdivisions and supranational organizations. Investments by the
Funds in foreign securities involve risks in addition to those of U.S.
securities, in part because of higher political and economic risks and because
there is less public information available about foreign companies.

Repurchase Agreements. The Funds may buy securities with the understanding that
the seller will buy them back with interest at a later date. If the seller is
unable to honor its commitment to repurchase the securities, the Fund could lose
money.

Guaranteed Investment Contracts. The Cash Investment Fund and the Money Market
may invest in guaranteed investment contracts. Guaranteed investment contracts
are agreements of the Fund to make payments, generally to an insurance company's
general account, in exchange for a minimum level of interest based on an index.
Guaranteed investment contracts are considered illiquid investments and are
acquired subject to the Fund's limitation on illiquid investments.

Asset-Backed Securities. Subject to applicable maturity and credit criteria,
the Cash Investment Fund and the Money Market Fund may purchase securities
backed by mortgages, installment sales contracts, credit card receivables or
other assets. Mortgage-backed securities carry additional risks. The price and
yield of these securities typically assume that the securities will be redeemed
at a given time before maturity. When interest rates fall substantially, these
securities are generally redeemed early because the underlying mortgages are
often prepaid. In that case the Fund would have to reinvest the money at a
lower rate. In addition, the price or yield of mortgage-backed securities may
fall if they are redeemed later than expected.

Variable and Floating Rate Securities. Variable and floating rate securities
have interest rates that are periodically adjusted either at set intervals or
that float at a margin above a generally recognized index rate. These
securities exhibit greater price variations than fixed-rate securities.

Illiquid Securities. Illiquid securities include private placements or other
securities that are subject to legal or contractual restrictions on resale or
for which there is no readily available market. Each Fund may invest up to 10%
of its net assets in securities that are illiquid. To the extent that a Fund
invests in illiquid securities, the Fund risks not being able to sell the
securities at the time and the price that it would like. The Fund may have to
lower the price, sell substitute securities or forego an investment opportunity,
each of which may cause a loss to the Fund.

10
<PAGE>

When - Issued Securities, Delayed Delivery Transactions and Forward Commitments.
A purchase of "when-issued" securities refers to a transaction made
conditionally because the securities, although authorized, have not yet been
issued. A delayed delivery or forward commitment transaction involves a
contract to purchase or sell securities for a fixed price at a future date
beyond the customary settlement period. Purchasing or selling securities on a
when-issued, delayed delivery or forward commitment basis involves the risk that
the value of the securities may change by the time they ar3e actually issued or
delivered. These transactions also involve the risk that the seller may fail to
deliver the security or cash on the settlement date.

Zero Coupon Bonds. These are securities issued at a discount from their face
value because interest payments are typically postponed until maturity. The
market prices of zero coupon bonds generally are more volatile than the market
prices of interest-bearing securities and are likely to respond to a greater
degree to changes in interest rates than interest-bearing securities having
similar maturities and credit quality. A Fund's investments in zero coupon
bonds may require the Fund to sell some of its portfolio securities to generate
sufficient cash to satisfy certain income distribution requirements.

Stripped Securities. These securities are issued by the U.S. Government (or
agency or instrumentality), foreign governments or banks and other financial
institutions. They entitle the holder to receive either interest payments or
principal payments that have been "stripped" from a debt obligation. These
obligations include participations in trusts that hold U.S. Treasury or agency
securities. Stripped securities are very sensitive to changes in interest rates
and to the rate of principal repayments. A rapid or unexpected increase in
mortgage prepayments could severely depress the price of certain stripped
mortgage-backed securities and adversely affect a Fund's total returns.

Securities Lending. Each Fund may seek additional income by lending portfolio
securities to qualified institutions. By reinvesting any cash collateral it
receives in these transactions, the Fund could realize additional gains or
losses. If the borrower fails to return the securities and the invested
collateral has declined in value, the Fund could lose money.

Borrowing and Reverse Repurchase Agreements. The Funds can borrow money from
banks and enter into reverse repurchase agreements with banks and other
financial institutions. Reverse repurchase agreements involve the sale of
securities held by a Fund subject to the Fund's agreement to repurchase them at
a mutually agreed upon date and price (including interest). Each Fund may borrow
money in an amount up to 5% of its assets for temporary emergency purposes and
in an amount up to 33 1/3% of its assets to meet redemptions. This is a
fundamental policy which can be changed only by shareholders. Borrowings and
reverse repurchase agreements by a Fund may involve leveraging. If the
securities held by the Fund decline in value while these transactions are
outstanding, the Fund's net asset value will decline in value by proportionately
more than the decline in value of the securities. In addition, reverse
repurchase agreements involve the risks that the interest income earned by the
Fund (from the investment of the proceeds) will be less than the interest
expense of the transaction, that the market value of the securities sold by the
Fund will decline below the price the Fund is obligated to pay to repurchase the
securities, and that the securities may not be returned to the Fund.

Short-Term Trading. Each Fund may engage in short-term trading. A high rate of
portfolio turnover (100% or more) could produce higher trading costs and taxable
distributions, which could detract from a Fund's performance.

11
<PAGE>

Year 2000 Risk. Like other mutual funds, financial institutions, business
organizations and individuals around the world, the Fund could be adversely
affected if the computer systems used by the advisor and the Fund's other
service providers do not properly process and calculate date-related information
and data from and after January 1, 2000. The advisor is taking steps that it
believes are reasonably designed to address year 2000 computer-related problems
with respect to the computer systems that it uses and to obtain assurances that
comparable steps are being taken by the Fund's other major service providers.
Although there can be no assurances, the advisor believes that these steps will
be sufficient to avoid any adverse impact on the Fund. Similarly, there can be
no assurance that year 2000 issues will not affect the companies and other
issuers in which the Fund invests or affect worldwide markets and economies.

12
<PAGE>

Your Investment
- --------------------------------------------------------------------------------

This section describes how to do business with the Funds.

How To Reach The Funds

By telephone: 1-800-438-5789
Call for shareholder services.

By mail: The Munder Funds
480 Pierce Street
Birmingham, Michigan 48009

Purchasing Shares

Purchase Price of Shares

Class A shares of a Fund are sold at the net asset value (NAV) next determined
without a sales charge after a purchase order is received in proper form.

Brokers-dealers (other than the Fund's distributor) may charge you additional
fees for shares you purchase through them.

Policies for Purchasing Shares

Investment Minimums
The minimum initial investment for Class A shares of the Cash Investment Fund,
the Tax-Free Money Market Fund and U.S. Treasury Money Market Fund is $250.

Subsequent investments must be at least $50.

Timing of orders
Purchase orders must be received by the Fund's distributor or the transfer agent
before the close of regular trading on the New York Stock Exchange (normally,
4:00 p.m. Eastern time).

Methods for Purchasing Shares

Class A, B and C shares of the Money Market Fund may be acquired only through an
exchange of shares of the corresponding class of another Munder Fund.

Investors may purchase Class A shares of the Cash Investment Fund, the Tax-Free
Money Market Fund and U.S. Treasury Money Market Fund:

. By Broker. Any broker authorized by the distributor can sell you Class A
shares of the Funds. Please note that brokers may charge you fees for their
services.

. By Mail. You may open an account by completing, signing and mailing the
attached account application form and a check or other negotiable bank draft
(payable to The Munder Funds) for $250 or more to: The Munder Funds, c/o
First Data Investor Services Group, P.O. Box 60428, King of Prussia,
Pennsylvania 19406-0428. For additional investments, send a letter stating
the Fund and share class you wish to purchase, your name and your account
number with a check for $50 or more to the address listed above. [We do not
generally accept third-party checks.]

. By Wire. To open a new account, you should call the Funds at (800) 438-5789
to obtain an account number and complete wire instructions prior to wiring
any funds. Within seven days of purchase, you must send a completed account
application form containing your certified taxpayer identification number to
the transfer agent at The Munder Funds, c/o First Data Investor Services
Group, P.O. Box 60428, King of Prussia, Pennsylvania 19406-0428. Wire
instructions must state the Fund name, share class, your registered name and
your account number. Your bank wire should be sent through the Federal
Reserve Bank Wire System to:

Boston Safe Deposit and Trust Company
Boston, MA
ABA# 011001234
DDA# 16-798-3
Account No.:

You may make additional investments at any time using the wire procedures
described above. Note that banks may charge fees for transmitting wires.

. You may purchase shares through the Automatic Investment Plan.

13
<PAGE>

Exchanging Shares

Policies for Exchanging Shares

. You may exchange Class A shares of your Fund for Class A shares of other
Munder Funds based on their relative net asset values.

. You may exchange Class B and Class C shares of the Money Market Fund for the
corresponding class of shares of other Munder Funds.

. [You may exchange Class A shares of the Cash Investment Fund, the U.S.
Treasury Money Market Fund and the Tax-Free Money Market Fund for Class A,
Class B or Class C shares of other Munder Funds, subject to any applicable
sales charge differential.]

. [Class A shares of the Funds that were (1) acquired through the use of the
exchange privilege and (2) can be traced back to a purchase of shares in one
or more Munder Funds for which a sales charge was paid, can be exchanged for
Class A shares of another Munder Fund.]

. Class B and Class C shares of the Money Market Fund will continue to age from
the date of the original purchase and will retain the same CDSC rate as they
had before the exchange.

. You must meet the minimum purchase requirements for the Munder Fund that you
purchase by exchange.

. If you are exchanging into shares of a Munder Fund with a higher sales
charge, you must pay the difference at the time of the exchange.

. A share exchange is a taxable event and, accordingly, you may realize a
taxable gain or loss.

. Before making an exchange request, read the prospectus of the Munder Fund you
wish to purchase by exchange. You can obtain a prospectus for any Munder Fund
by contacting your broker or calling the Munder Funds at (800) 438-5789.

. Brokers may charge a fee for handling exchanges.

. We may change, suspend or terminate the exchange privilege at any time. You
will be given notice of any material modifications except where notice is not
required.

Methods for Exchanging Shares

. Exchanges By Telephone. You may give exchange instructions by telephone to
the Funds at (800) 438-5789. You may not exchange shares by telephone if you
hold share certificates. We reserve the right to reject any telephone
exchange request and to place restrictions on telephone exchanges.

Redeeming Shares

Redemption Price

We will redeem shares at the NAV next determined after we receive the redemption
request in proper form. We will reduce the amount you receive by the amount of
any applicable contingent deferred sales charge (CDSC).

Please see "Distribution Arrangements" below for information about CDSCs.

Policies for Redeeming Shares

. For your protection, a signature guarantee is required for the following
redemption requests: (a) redemption proceeds greater than $50,000; (b)
redemption proceeds not being made payable to the recordowner of the account;
(c) redemption proceeds not being mailed to the address of record on the
account or (d) if the redemption proceeds are being transferred to another
Munder Fund account with a different registration. You can obtain a signature
guarantee from a financial institution such as a commercial bank, trust
company, savings association or from a securities firm having membership on a
recognized securities exchange.

Methods for Redeeming Shares

You may redeem shares of the Funds in several ways:

14
<PAGE>

. By Mail. You may mail your redemption request to: The Munder Funds, c/o First
Data Investor Services Group, P.O. Box 60428, King of Prussia, Pennsylvania
19406-0428. The redemption request should state the name of the Fund, share
class, account number, amount of redemption, account name and where to send
the proceeds. All account owners must sign.

. By Telephone. You can redeem your shares by calling your broker or by
calling the Funds at (800) 438-5789. There is no minimum requirement for
telephone redemptions.

If you are redeeming at least $1,000 of shares and you have authorized
expedited redemption on your account application form, simply call the Funds
prior to 4:00 p.m. (Eastern time), and request the funds be mailed to the
commercial bank or registered broker-dealer you designated on your account
application form. We will send your redemption amount to you on the next
business day. We reserve the right at any time to change or impose fees for
this expedited redemption procedure.

During periods of unusual economic or market activity, you may experience
difficulties or delays in effecting telephone redemptions. In such cases you
should consider placing your redemption request by mail.

. You may redeem shares through the Automatic Withdrawal Plan.

. Free Checkwriting is available to holders of Class A shares of the Funds.

Additional Policies For Purchases, Exchanges And Redemptions

. We consider orders to be in "proper form" when all required documents
are properly completed, signed and received.

. The Funds reserve the right to reject any purchase order.

. At any time, the Funds may change any of their purchase or redemption
procedures, and may suspend the sale of their shares.

. The Funds may delay sending redemption proceeds for up to seven days, or
longer if permitted by the Securities and Exchange Commission.

. To limit the Funds' expenses, we do not currently issue share
certificates.

. A Fund may temporarily stop redeeming shares if:

. the New York Stock Exchange is closed;

. trading on the New York Stock Exchange is restricted;

. an emergency exists and the Fund cannot sell its assets or accurately
determine the value of its assets; or

. if the Securities and Exchange Commission orders the Fund to suspend
redemptions.

. If accepted by a Fund, investors may purchase shares of the Fund with
securities which the Fund may hold. The advisor will determine if the
securities are consistent with the Funds' objectives and policies. If
accepted, the securities will be valued the same way the Fund values
portfolio securities it already owns. Call the Funds at (800) 438-5789
for more information.

. The Funds reserve the right to make payment for redeemed shares wholly
or in part by giving the redeeming shareholder portfolio securities. The
shareholder may pay transaction costs to dispose of these securities.

15
<PAGE>

. If you purchased shares directly from the Funds, the transfer agent will
send you confirmations of the opening of an account and of all
subsequent purchases, exchanges or redemptions in the account. If your
account has been set up by a broker or other investment professional,
account activity will be detailed in their statements to you.

Shareholder Privileges

. Automatic Investment Plan (AIP). Under the AIP you may arrange for periodic
investments in a Fund through automatic deductions from a checking or savings
account. To enroll in the AIP you should complete the AIP application form or
call the Funds at (800) 438-5789. The minimum pre-authorized investment
amount is $50. You may discontinue the AIP at any time. We may discontinue
the AIP on 30 days' written notice to you.

. Automatic Withdrawal Plan (AWP). If you have an account value of $2,500 or
more in a Fund, you may redeem shares on a monthly, quarterly, semi-annual or
annual basis. The minimum withdrawal is $50. We usually process withdrawals
on the 20th day of the month and promptly send you your redemption amount.
You may enroll in the AWP by completing the AWP application form available
through the transfer agent. To participate in the AWP you must have your
dividends automatically reinvested and may not hold share certificates. You
may change or cancel the AWP at any time upon notice to the Funds' transfer
agent. You should not buy Class A shares (and pay a sales charge) while you
participate in the AWP and you must pay any applicable CDSC when you redeem
shares.

. Free Checkwriting. Free checkwriting is available to holders of Class A
shares of the Funds who complete the signature card section of the account
application form. You may write checks in the amount of $500 or more but you
may not close a Fund account by writing a check. We may change or terminate
this program on 30 days' notice to you.

16
<PAGE>

Distribution Arrangements
- --------------------------------------------------------------------------------
Cdsc

You pay a CDSC when you redeem:
. Class A shares of the Money Market Fund within one year of buying them;
. Class A shares of the Money Market Fund acquired through the exchange of
Class A Shares of another Munder Fund purchased before Jun e 27, 1995 as part
of an investment of $500,000 or more;
. Class B shares of the Money Market Fund within six years of buying them;
. Class C shares of the Money Market Fund within one year of buying them.

These time periods include the time you held the shares you
exchanged to acquire Money Market Fund shares.

You pay a 1% CDSC when you redeem Class A shares of the Money Market Fund:
. that you acquired through the exchange of initial Class A shares of another
Munder Fund;
. if you acquired the initial Class A shares after June 27, 1995; and
. if the initial shares were purchased without a sales charge in connection
with an investment of $1,000,000 or more.

You pay a CDSC of 1% when you redeem Class C shares of the Money Market Fund
within one year of the date you purchased the initial Class C shares that you
exchanged to acquire Money Market Fund shares.

The CDSC schedule for Class B shares of the Money Market Fund purchased after
June 27, 1995 is set forth below. Consult the Statement of Additional
Information for the CDSC schedule for Class B shares purchased on or before June
27, 1995. The CDSC is based on the original NAV at the time of your investment
or the NAV at the time of redemption, whichever is lower.

Money Market Fund
Class B Shares

Years Since Purchase CDSC
- -------------------- ----
<S> <C>
First....................................... 5.00%
Second...................................... 4.00%
Third....................................... 3.00%
Fourth...................................... 3.00%
Fifth....................................... 2.00%
Sixth....................................... 1.00%
Seventh and thereafter...................... 0.00%
</TABLE>

You will not pay a CDSC to the extent that the value of the redeemed shares
represents:
. reinvestment of dividends or capital gains distributions; or
. capital appreciation of shares redeemed.

CDSC Waivers
We will waive the CDSC payable upon redemption of Class B shares of the Money
Market Fund which you purchased after June 27, 1995 for:

. redemptions made within one year after the death of a shareholder or
registered joint owner;
. minimum required distributions made from an IRA or other retirement plan
account after you reach age 70 1/2;
. involuntary redemptions made by the Fund;
. redemptions limited to 10% per year of an account's NAV. For example, if you
maintain an annual balance of $10,000 you can redeem up to $1,000 annually
free of charge.

. redemptions made from an IRA or other individual retirement plan account
established through Comerica Securities, Inc. after you reach age 59 1/2 and
after the eighteen month anniversary of the purchase of Fund shares.

Consult the Statement of Additional Information for Class A and Class B CDSC
waivers which apply

17
<PAGE>

when you redeem shares of the Money Market Fund purchased on or before June 27,
1995.

Rule 12b-1 Fees

The Funds have adopted Rule 12b-1 plans with respect to their Class A shares and
the Money Market Fund has adopted Rule 12b-1 plans for Class B and Class C
shares that allow the Funds to pay distribution and other fees for the sale of
its shares and for services provided to shareholders. Under the plans, the Funds
may pay up to .25% of the daily net assets of Class A , Class B and Class C
shares to pay for certain shareholder services provided by institutions that
have agreements with the Funds' distributor to provide such services. The Money
Market Fund may also pay up to .75% of the daily net assets of the Class B and
Class C shares to finance activities relating to the distribution of its shares.

Because the fees are paid out of a Fund's assets on an on-going basis, over time
these fees will increase the cost of an investment in a Fund and may cost a
shareholder more than paying other types of sales charges.

Other Information

Please note that Comerica Bank, an affiliate of the advisor, receives a fee from
the Funds for providing Shareholder services to its customers who own shares of
the Funds.

18
<PAGE>

Pricing of Fund Shares
- -----------------------------------------------------------------------------

Each Fund's NAV is calculated on each day the New York Stock Exchange is open.
NAV is the value of a single share of a Fund. Each Fund calculates NAV
separately for each class. NAV is calculated by (1) taking the current value of
a Fund's total assets allocated to a particular class of shares, (2)
subtracting the liabilities and expenses charged to that class (3) dividing that
amount by the total number of shares of that class outstanding.

The Funds calculate NAV as of 2:45 p.m. (Eastern time) and as of the close of
business on the New York Stock Exchange, normally 4:00 p.m. (Eastern time).

If the New York Stock Exchange closes early, the Funds will accelerate its
calculation of NAV and transaction deadlines to that time.

In determining each Money Market Fund's NAV, securities are valued at amortized
cost, which is approximately equal to market value.

Distributions
- -----------------------------------------------------------------------------

The Funds declare dividends daily and pay them monthly.

Each Fund distributes its net realized capital gains, if any, at least annually.

If a purchase order is accepted by 2:45 p.m. (Eastern time), the investor will
receive dividends for that day. Otherwise the investor will begin to earn
dividends on the first business day following the day of purchase. If a
redemption order is received by 2:45 p.m. (Eastern time), the redeeming
shareholder will not receive dividends for that day.

Each Fund normally will pay distributions in additional shares of that Fund. If
you wish to receive distributions in cash, either indicate this request on your
account application form or notify the Fund by calling (800) 438-5789.

19
<PAGE>

Federal Tax Considerations
- ---------------------------------------------------------------------------

Taxes On Distributions

You will generally have to pay federal income tax on all Fund distributions.
Distributions will be taxed in the same manner whether you receive the
distributions in cash or in additional shares of the Fund. The Tax-Free Money
Market Fund expects that a portion of its dividend distributions will be exempt
from federal income tax. Shareholders not subject to tax on their income,
generally will not be required to pay any tax on distributions.

Distributions that are derived from net long-term capital gains generally will
be taxed as long-term capital gains. Dividend distributions and short-term
capital gains generally will be taxed as ordinary income. The tax you pay on a
given capital gains distribution generally depends on how long the Fund held
the portfolio securities it sold. It does not depend on how long you held your
Fund shares.

Taxes On Sales Or Exchanges

Other Considerations

If you have not provided complete, correct taxpayer information by law the Funds
must withhold a portion of your distributions and redemption proceeds to pay
federal income taxes.

20
<PAGE>

Management
- --------------------------------------------------------------------------------

Investment Advisor

The Funds' investment advisor is Munder Capital Management, 480 Pierce Street,
Birmingham, Michigan 48009. As of September 30, 1999, the advisor and its
affiliates had approximately $___ billion in assets under management, of which
$___ billion were invested in equity securities, $___ billion were invested in
money market or other short-term instruments, $___ billion were invested in
other fixed income securities, and $___ billion in non-discretionary assets.

The advisor provides overall investment management for the Funds, provides
research and credit analysis and is responsible for all purchases and sales of
portfolio securities.

During the fiscal year ended June 30, 1999, each Fund paid an advisory fee at an
annual rate based on the average daily net assets of the Fund (after waivers, if
any) as follows:

Cash Investment Fund.................... .35%
Tax-Free Money Market Fund.............. .35%
U.S. Treasury Money Market Fund......... .35%
Money Market Fund....................... .40%

21
<PAGE>

Financial Highlights
- --------------------------------------------------------------------------------

The financial highlights table is intended to help shareholders understand the
financial performance of each class of shares of each Fund for the past 5 years
(or, if shorter, the period of the Fund's or class' operations). Certain
information reflects financial results for a single Fund share. The total
returns in the table represent the rate that an investor would have earned (or
lost) on an investment in a particular class of the Fund (assuming reinvestment
of all dividends and distributions). The financial highlights have been audited
by Ernst & Young LLP, independent accountants, whose report, along with each
Fund's financial statements, are included in the annual reports, and
incorporated by reference into the Statement of Additional Information. You may
obtain the annual report without charge by calling (800) 438-5789.

Cash Investment Fund(a)
--------------------------------------------------------------------------
Year Year Year Year Year
Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d)
Class A Class A Class A Class A Class A
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period..................
Income from investment operations:
Net investment income.................................
Total from investment operations......................
Less distributions:
Dividends from net investment income..................
Total distributions...................................
Net asset value, end of period........................
Total return (b)......................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)..................
Ratio of operating expenses to average net assets ....
Ratio of net investment income to average net assets..
Ratio of operating expenses to average net assets
without waivers.......................................
</TABLE>

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

22
<PAGE>

<TABLE>
<CAPTION>
Cash
Investment
Fund(a) Money Market Fund(a)
- ---------- ----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Year Year Year Year Period Year Year Year Year
Ended Ended Ended Ended Ended Ended Ended Ended Ended
2/28/95(e) 6/30/99 6/30/98 6/30/97 6/30/96 6/30/99 6/30/98 6/30/97 6/30/96
Class A Class A Class A Class A Class A Class B Class B Class B Class B
- ---------- ------- ------- ------- ------- ------- ------- ------- -------
</TABLE>

23
<PAGE>

<TABLE>
<CAPTION>
Money Market Fund(a)
--------------------------------------------------
Period Year Year Period
Ended Ended Ended Ended
6/30/95(d, e) 6/30/99 6/30/98 6/30/97
Class B Class C Class C Class C
------------- ------- ------- -------
<S> <C> <C> <C> <C>
Net asset value, beginning of period...................
Income from investment operations:
Net investment income..................................
Total from investment operations.......................
Less distributions:
Dividends from net investment income...................
Total distributions....................................
Net asset value, end of period.........................
Total return (b).......................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...................
Ratio of operating expenses to average net assets .....
Ratio of net investment income to average net assets...
Ratio of operating expenses to average net assets
without waivers.......................................
</TABLE>
- -----------------

24
<PAGE>

<TABLE>
<CAPTION>
Tax-Free Money Market Fund(a)
- -----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
Class A Class A Class A Class A Class A Class A
- ------- ------- ------- ------- ---------- ----------
</TABLE>

25
<PAGE>

<TABLE>
<CAPTION>
U.S. Treasury Money Market Fund(a)
-------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96 6/30/95(d) 2/28/95(e)
Class A Class A Class A Class A Class A Class A
------- ------- ------- ------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............
Income from investment operations:
Net investment income............................
Total from investment operations.................
Less distributions:
Dividends from net investment income.............
Total distributions..............................
Net asset value, end of period...................
Total return (b).................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's).............
Ratio of operating expenses to average net
assets .........................................
Ratio of net investment income to average net
assets..........................................
Ratio of operating expenses to average net assets
without waivers.................................
</TABLE>
- ----------------
26

<PAGE>

For More Information

More information about the Funds is available free upon request,
including the following:

Annual/Semi-Annual Reports

You will receive unaudited semi-annual reports and audited annual reports on a
regular basis from the Funds. In addition, you will also receive updated
prospectuses or supplements to this prospectus. In order to eliminate duplicate
mailings, the Funds will only send one copy of the above communications to (1)
accounts with the same primary record owner, (2) joint tenant accounts, (3)
tenant in common accounts and (4) accounts which have the same address.

Statement of Additional Information

Provides more details about the Funds and their policies. A current Statement of
Additional Information is on file with the Securities and Exchange Commission
and is incorporated by reference (is legally considered part of this
prospectus).

To Obtain Information:

By telephone
Call 1-800-438-5789

By mail
The Munder Funds
480 Pierce Street
Birmingham, MI 48009

On the Internet
Text-only versions of fund documents can be viewed online or downloaded from:

Securities and Exchange Commission
http://www.sec.gov

You can also obtain copies by visiting the Securities and Exchange Commission's
Public Reference Room in Washington, D.C. (phone 1-800-SEC-0330) or by sending
your request and a duplicating fee to the Securities and Exchange Commission's
Public Reference Section, Washington, D.C. 20549-6009.

You may also find more information about the Funds on the Internet at:
http://www.munderfunds.com

The Munder Funds, Inc.
SEC file number: 811-7346

The Munder Funds Trust
SEC file number: 811-5899
<PAGE>

Class A, B & C Shares

[Munder Logo]
Prospectus

October 26, 1999

The Munder Index 500 Fund

As with all mutual funds, the Securities and
Exchange Commission has not approved or
disapproved these securities nor passed upon
accuracy or adequacy of this prospectus.
It is a criminal offense to state otherwise.
<PAGE>

Table Of Contents

2 Risk/Return Summary
2 Goal
2 Principal Investment Strategy
2 Principal Risks
3 Who May Want To Invest
4 Performance
5 Fees And Expenses

6 More About The Fund

8 Your Investment
8 How To Reach The Fund
8 Purchasing Shares
9 Exchanging Shares
9 Redeeming Shares
10 Additional Policies For Purchases, Exchanges And Redemptions
11 Shareholder Privileges

12 Distribution Arrangements
12 Share Class Selection
12 Applicable Sales Charge
13 Cdsc
15 12b-1 Fees
15 Other Information

16 Pricing Of Fund Shares

16 Distributions

17 Federal Tax Considerations
17 Taxes On Distributions
17 Taxes On Sales Or Exchanges
17 Other Considerations

18 Management
18 Investment Advisor
18 Portfolio Managers

19 Financial Highlights

Back Cover For Additional Information
<PAGE>

Risk/Return Summary
- -----------------------------------------------------------------------------

This Risk/Return Summary briefly describes the goal and principal investment
strategy of the Munder Index 500 Fund and the principal risks of investing in
the Fund. For further information on the Fund's principal and other investment
strategies and risks, please read the section entitled "More About The Fund".

Goal

The Fund's goal is to provide performance and income that is comparable to the
Standard & Poor's 500 Composite Stock Price Index (S&P 500). The S&P 500 is an
index of 500 stocks which emphasizes large capitalization companies.

Principal Investment Strategy

The Fund pursues its goal by normally holding the securities of at least 400 of
the stocks in the S&P 500.

The Fund may also enter into futures contracts.

Principal Risks

All investments carry some degree of risk which will affect the value of the
Fund's portfolio investments, its investment performance and the price of its
shares. As a result, you may lose money if you invest in the Fund.

An investment in the Fund is not a bank deposit and is not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other governmental agency.

The Fund is subject to the following principal investment risks:

. Stock Market Risk. The value of the securities in which the Fund invests
may decline in response to general economic conditions. Price changes may
be temporary or last for extended periods. For example, stock prices have
historically risen and fallen in periodic cycles. In addition, the value of
the Fund's investments may decline if particular companies the Fund invests
in do not perform well.

. Tracking Risk. Because the Fund pays fees and transaction costs, while the
S&P 500 does not, the Fund's returns are likely to be lower than those of
the S&P 500. Tracking variance may also result from share purchases,
redemptions and other factors.

. Indexing Strategy Risk. The Fund will invest in the securities included in
the S&P 500 regardless of market trends. As a result, the Fund cannot
modify its investment strategy to respond to changes in the economy, which
means it may be particularly susceptible to a general decline in the large
capitalization portion of the U.S. stock market.

. Derivatives Risk. The Fund may suffer a loss from its use of futures
contracts, which are forms of derivatives. The primary risk with many
derivatives is that they can amplify a gain or loss, potentially earning or
losing substantially more money than the actual cost of the derivative
instrument.

2
<PAGE>

Who May Want To Invest

The Fund may be appropriate for investors:

. Looking to invest over the long term and willing to ride out market swings.

. Willing to accept greater risks than those associated with fixed income
investments.

. Looking to invest in a diversified stock portfolio focused on large
capitalization companies.

The Fund alone cannot provide a balanced investment program.

3
<PAGE>

Performance

The bar chart and tables below give some indication of: (a) the variability of
the Fund's returns by showing changes in the Fund's performance from year to
year over the life of the Fund; and (b) the risk of an investment in the Fund by
showing how the Fund's average annual total returns for different calendar
periods over the life of the Fund compare to those of a broad based securities
market index.

When you consider this information, please remember the Fund's performance in
past years is not necessarily an indication of how the Fund will perform in the
future.

[BAR CHART]

Calendar Year Total Return (Class A)

The annual returns in the bar chart are for the Fund's Class A Shares and do not
reflect sales loads. If sales loads were reflected, returns would be less than
those shown.

1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%
__________________
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)
Since
Class- Inception Date* 1 Year 5 Years Inception
- ---------------------- ------------ ------------- ------------
Class A (12/9/92)
Class B (10/31/92)
[Index] **
Since inception of Class ___***
Since inception of Class ___***
_____________________
*As of the date of this prospectus, Class C shares are not being offered.
Accordingly, performance information for that class is not presented.
**Index return from __/__/9__
***Index return from month-end of applicable class inception date.

The average annual total returns reflect imposition of the maximum front-end or
contingent deferred sales charge and conversion of Class B shares to Class A
shares after the applicable period.

4
<PAGE>

Fees And Expenses
The table below describes the fees and expenses that you may pay if you buy and
hold shares of the Fund. Please note the following information does not include
fees that institutions may charge for services they provide to you.

<TABLE>
Class A Class B Class C
Shareholder Fees (fees paid directly from your investment) Shares Shares Shares
------- ------- -------
<S> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases........................... 2.5%(a) None None
Sales Charge (Load) Imposed on Reinvested Dividends........................ None None None
Maximum Deferred Sales Charge (Load)....................................... None(b) 3%(c) 1%(d)
Redemption Fees............................................................ None None None
Exchange Fees.............................................................. None None None

Annual Fund Operating Expenses (expenses that are paid from Fund assets) as a %
of net assets
Class A Class B Class C
Shares Shares Shares
------- ------- -------
Management Fees .12% .12% .12%
Distribution and/or Service (12b-1) Fees .15% .50% 1.00%
Other Expenses [ ]% [ ]% [ ]%
------- ------- -------
Total Annual Fund Operating Expenses [ ]% [ ]% [ ]%
======= ======= =======
</TABLE>
________________________
(a) The sales charge declines as the amount invested increases.
(b) A contingent deferred sales charge (CDSC) is a one-time fee charged at the
time of redemption. A 0.20% CDSC applies to redemptions of Class A shares that
were purchased with no initial sales charge as part of an investment of $500,000
or more and are redeemed within one year of purchase.
(c) The CDSC payable upon redemption of Class B shares declines over time.
(d) Payable on redemptions of Class C shares within one year of purchase.

Example

The example is intended to help you compare the cost of investing in the Fund to
the cost of investing in other mutual funds. The example assumes that you invest
$10,000 in the Fund for the time periods indicated. The example also assumes
that your investment has a 5% return each year, that the Fund's operating
expenses remain the same as shown in the table and that all dividends and
distributions are reinvested. Although your actual costs may be higher or lower,
based on these assumptions your costs would be:

<TABLE>
Class A Class B Class B Class C Class C
Shares Shares* Shares** Shares* Shares**
------- -------- --------- -------- ---------
<S> <C> <C> <C> <C> <C>
1 Year $ $ $ $ $

3 Years $ $ $ $ $
5 Years $ $ $ $ $

10 Years*** $ $ $ $ $
</TABLE>
________________________
*Assumes you sold your shares at the end of the time period.
**Assumes you stayed in the Fund.
***Reflects conversion of Class B shares to Class A shares (which pay lower
ongoing expenses) approximately six years after the date of original purchase.

5
<PAGE>

More About The Fund
- -------------------------------------------------------------------------------

The Fund's principal investment strategy and risks are summarized above in the
section entitled "Risk/Return Summary". A more complete description of the
Fund's investments and strategies and their associated risks is provided below.
The Fund may also invest in other securities and is subject to further
restrictions and risks which are described in the Statement of Additional
Information.

Equity Securities. The Fund invests in equity securities which include common
stocks, preferred stocks and securities convertible into common stocks.

Foreign Securities. Foreign securities include direct investments in non-U.S.
dollar-denominated securities traded outside of the United States and
dollar-denominated securities of foreign issuers traded in the United States.
Foreign securities also include indirect investments such as American Depository
Receipts ("ADRs") which are U.S. dollar-denominated receipts representing shares
of foreign-based corporations. ADRs are issued by U.S. banks or trust companies,
and entitle the holder to all dividends and capital gains that are paid out on
the underlying foreign shares.

Investment Strategy. The Fund may invest up to 25% of its total assets
in foreign securities.

Special Risks. Foreign securities involve special risks and costs.
Investment in foreign securities may involve higher costs than
investment in U.S. securities, including higher transaction and custody
costs as well as the imposition of additional taxes by foreign
governments. Foreign investments may also involve risks associated with
the level of currency exchange rates, less complete financial
information about the issuers, less market liquidity, more market
volatility and political instability. Future political and economic
developments, the possible imposition of withholding taxes on dividend
income, the possible seizure or nationalization of foreign holdings,
the possible establishment of exchange controls or freezes on the
convertibility of currency, or the adoption of other governmental
restrictions might adversely affect an investment in foreign
securities. Additionally, foreign issuers may be subject to less
stringent regulation, and to different accounting, auditing and
recordkeeping requirements.

Currency exchange rates may fluctuate significantly over short periods
of time causing the Fund's net asset value to fluctuate as well. A
decline in the value of a foreign currency relative to the U.S. dollar
will reduce the value of a foreign currency-denominated security. To
the extent that the Fund is invested in foreign securities while also
maintaining currency positions, it may be exposed to greater combined
risk. The Fund's respective net currency positions may expose it to
risks independent of its securities positions.

A further risk of investing in foreign securities is the risk that the Fund may
be adversely affected by the conversion of certain European currencies into the
Euro. This conversion, which is under way, is scheduled to be completed in the
year 2002. However, problems with the conversion process and delays could
increase volatility in world capital markets and affect European capital markets
in particular.

Derivatives. Derivatives are financial contracts whose value is based on a
security, a currency exchange or interest rate or a market index. Many types of
instruments representing a wide range of potential risks and rewards are
derivatives, including futures contracts, options on futures contracts and
options.

Investment Strategy. Derivatives can be used for hedging (attempting to
reduce risk by offsetting one investment position with another) or
speculation (taking a position in the hope of increasing return). The
Fund may, but is not required to, use derivatives for hedging purposes
or for the purpose of remaining fully invested or maintaining
liquidity. The Fund will not use derivatives for speculative purposes.

Special Risks. The use of derivative instruments exposes the Fund to
additional risks and transaction costs. Risks of derivative instruments
include: (1) the risk that interest rates, securities prices and
currency markets will not move in the direction that a portfolio
manager anticipates; (2) imperfect correlation

6
<PAGE>

between the price of derivative instruments and movements in the prices
of the securities, interest rates or currencies being hedged; (3) the
fact that skills needed to use these strategies are different than
those needed to select portfolio securities; (4) the possible absence
of a liquid secondary market for any particular instrument and possible
exchange imposed price fluctuation limits, either of which may make it
difficult or impossible to close out a position when desired; (5) the
risk that adverse price movements in an instrument can result in a loss
substantially greater than the Fund's initial investment in that
instrument (in some cases, the potential loss is unlimited); (6)
particularly in the case of privately-negotiated instruments, the risk
that the counterparty will not perform its obligations, which could
leave the Fund worse off than if it had not entered into the position;
and (7) the inability to close out certain hedged positions to avoid
adverse tax consequences.

Futures Contracts and Related Options. A futures contract is a type of
derivative instrument that obligates the holder to buy or sell an asset in the
future at an agreed upon price. When the Fund purchases an option on a futures
contract, it has the right to assume a position as a purchaser or seller of a
futures contract at a specified exercise price during the option period. When
the Fund sells an option on a futures contract, it becomes obligated to purchase
or sell a futures contract if the option is exercised.

Investment Strategy. The Fund may invest in futures contracts and
options on futures contracts on domestic or foreign exchanges or boards
of trade. These instruments may be used for hedging purposes, to
maintain liquidity to meet potential shareholder redemptions, to invest
cash balances or dividends, or to minimize trading costs.

The Fund will not purchase or sell a futures contract unless, after the
transaction, the sum of the aggregate amount of margin deposits on its
existing futures positions and the amount of premiums paid for related
options used for non-hedging purposes is 5% or less of the Fund's total
assets.

Special Risks. Futures contracts and related options present the
following risks: imperfect correlation between the change in market
value of the Fund's securities and the price of futures contracts and
options; the possible inability to close a futures contract when
desired; losses due to unanticipated market movements, which are
potentially unlimited; and the possible inability of the advisor to
correctly predict the direction of securities prices, interest rates,
currency exchange rates and other economic factors.

Securities Lending. In order to generate additional income, the Fund may lend
securities on a short-term basis to qualified institutions. By reinvesting any
cash collateral it receives in these transactions, the Fund could realize
additional income gains or losses.

Investment Strategy. Securities lending may represent no more than 25%
of the value of the Fund's total assets (including the loan
collateral).

Special Risks. The main risk when lending Fund securities is that if
the borrower fails to return the securities or the invested collateral
has declined in value, the Fund could lose money.

Borrowing and Reverse Repurchase Agreements. The Fund can borrow money from
banks and enter into reverse repurchase agreements with banks and other
financial institutions. Reverse repurchase agreements involve the sale of
securities held by the Fund subject to the Fund's agreement to repurchase them
at a mutually agreed upon date and price (including interest).

Investment Strategy. The Fund may borrow money in an amount up to 5% of
its assets for temporary emergency purposes and in an amount up to 33
1/3% of its assets to meet redemptions. This is a fundamental policy
which can be changed only by shareholders.

Special Risks. Borrowings and reverse repurchase agreements by the Fund
may involve leveraging. If the securities held by the Fund decline in
value while these transactions are outstanding, the Fund's net asset
value will decline in value by proportionately more than the decline in
value of the securities. In addition, reverse repurchase agreements
involve the risks that the interest income earned by the Fund (from the
investment of the proceeds) will

7
<PAGE>

be less than the interest expense of the transaction, that the market
value of the securities sold by the Fund will decline below the price
the Fund is obligated to pay to repurchase the securities, and that the
securities may not be returned to the Fund.

Disclaimers. The Fund is not sponsored, endorsed, sold or promoted by S&P, nor
does S&P guarantee the accuracy and/or completeness of the S&P 500(R) Index or
any data included therein. S&P makes no warranty, express or implied, as to the
results to be obtained by the Fund, owners of the Fund, any person or any entity
from the use of the S&P 500(R) Index or any data included therein. S&P makes no
express or implied warranties and expressly disclaims all such warranties of
merchantability or fitness for a particular purpose for use with respect to the
S&P(R) Index or any data included therein.

8
<PAGE>

Your Investment
- --------------------------------------------------------------------------------

This section describes how to do business with the Fund.

How To Reach The Fund

By telephone: 1-800-438-5789
Call for account information

By mail: The Munder Funds
480 Pierce Street
Birmingham, Michigan 48009

Purchasing Shares

Purchase Price of Shares
Class A shares of the Fund are sold at the net asset value per share (NAV) next
determined after a purchase order is received in proper form plus any applicable
sales charge. Please see "Distribution Arrangements" below for information about
sales charges.

Class B and Class C shares of the Fund are sold at NAV next determined after a
purchase order is received in proper form.

Broker-dealers (other than the Fund's distributor) may charge you additional
fees for shares you purchase through them.

Policies for Purchasing Shares

Investment Minimums
Initial: $250

Subsequent: $ 50

Automatic Investment Plan: $ 25

Purchases in excess of $250,000 must be for Class A or Class C shares.

Timing of orders
Purchase orders must be received by the Fund's distributor or transfer agent
before the close of regular trading on the New York Stock Exchange (normally,
4:00 p.m. Eastern time).

Methods for Purchasing Shares
Investors may purchase shares:
. By Broker. Any broker authorized by the Fund's distributor can sell you
shares of the Fund. Please note that brokers may charge you fees for their
services.

. By Wire. To open a new account, you should call the Fund at (800) 438-5789
to obtain an account number and complete wire instructions prior to wiring
any funds. Within seven days of purchase, you must send a completed account
application form containing your certified taxpayer identification number
to the Fund's transfer agent at The Munder Funds, c/o First Data Investor
Services Group, P.O. Box 60428, King of Prussia, Pennsylvania 19406-0428.
Wire instructions must state the Fund name, share class, your registered
name and your account number. Your bank wire should be sent through the
Federal Reserve Bank Wire System to:

Boston Safe Deposit and Trust Company
Boston, MA
ABA# 011001234
DDA# 16-798-3
Account No.:

You may make additional investments at any time using the wire procedures
described above. Note that banks may charge fees for transmitting wires.

. You may purchase shares through the Automatic Investment Plan.

9
<PAGE>

. You may purchase shares through the Reinvestment Privilege.

Exchanging Shares

Policies for Exchanging Shares
. You may exchange Fund shares for shares of the same class of other Munder
Funds based on their relative net asset values.

. Class B and Class C shares will continue to age from the date of the
original purchase and will retain the same CDSC rate as they had before the
exchange.

. You must meet the minimum purchase requirements for the Munder Fund that
you purchase by exchange.

. If you are exchanging into shares of a Munder Fund with a higher sales
charge, you must pay the difference at the time of the exchange.

. A share exchange is a taxable event and, accordingly, you may realize a
taxable gain or loss.

. Brokers may charge you a fee for handling exchanges.

. We may change, suspend or terminate the exchange privilege at any time. You
will be given notice of any material modifications except where notice is
not required.

Methods for Exchanging Shares
. Exchanges By Telephone. You may give exchange instructions by telephone to
the Fund at (800) 438-5789. You may not exchange shares by telephone if you
hold share certificates. We reserve the right to reject any telephone
exchange request and to place restrictions on telephone exchanges.

. Exchanges By Mail. You may send exchange orders to your broker or you may
send them directly to the Fund's transfer agent at The Munder Funds, c/o
First Data Investor Services Group, P.O. Box 60428, King of Prussia,
Pennsylvania 19406-0428.

Redeeming Shares

Please see "Distribution Arrangements" below for information about CDSCs.

Policies for Redeeming Shares

. For your protection, a signature guarantee is required for the following
redemption requests: (a) redemption proceeds greater than $50,000; (b)
redemption proceeds not being made payable to the recordowner of the
account; (c) redemption proceeds not being mailed to the address of record
on the account or (d) if the redemption proceeds are being transferred to
another Munder Fund account with a different registration. You can obtain a
signature guarantee from a financial institution such as a commercial bank,
trust company, savings association or from a securities firm having
membership on a recognized securities exchange.

Methods for Redeeming Shares
You may redeem shares of the Fund in several ways:

. By Telephone. You can redeem your shares by contacting your broker or
calling the Fund at (800) 438-5789. There is no minimum requirement for
telephone redemptions.

10
<PAGE>

If you are redeeming at least $1,000 of shares and you have authorized
expedited redemption on your account application form, simply call the Fund
prior to 4:00 p.m. (Eastern time), and request the redemption proceeds be
mailed to the commercial bank or registered broker-dealer you designated on
your account application form. We will send your redemption proceeds to you
on the next business day. We reserve the right at any time to change or
impose fees for this expedited redemption procedure.

. You may redeem shares through the Automatic Withdrawal Plan.

Additional Policies For Purchases, Exchanges And Redemptions

. We consider orders to be in "proper form" when all required documents are
properly completed, signed and received.

. The Fund reserves the right to reject any purchase order.

. At any time, the Fund may change any of its purchase or redemption
procedures and may suspend the sale of its shares.

. The Fund may delay sending redemption proceeds for up to seven days, or
longer if permitted by the Securities and Exchange Commission.

. We will typically send redemption amounts to you within seven business days
after you redeem shares. We may hold redemption amounts from the sale of
shares you purchased by check until the purchase check has cleared, which
may be as long as 15 days.

. To limit the Fund's expenses, we do not currently issue share certificates.

. The Fund may temporarily stop redeeming shares if:

. the New York Stock Exchange is closed;

. trading on the New York Stock Exchange is restricted;

. an emergency exists and the Fund cannot sell its assets or accurately
determine the value of its assets; or the Securities and Exchange

. Commission orders the Fund to suspend redemptions.

. If accepted by the Fund, investors may purchase shares of the Fund with
securities which the Fund may hold. The advisor will determine if the
securities are consistent with the Fund's objectives and policies. If
accepted, the securities will be valued the same way the Fund values
portfolio securities it already owns. Call the Fund at (800) 438-5789 for
more information.

. The Fund reserves the right to make payment for redeemed shares wholly or
in part by giving the redeeming shareholder portfolio securities. The
shareholder may pay transaction costs to dispose of these securities.

. We record all telephone calls for your protection and take measures to
identify the caller. As long as the Fund's transfer agent takes reasonable
measures to authenticate telephone requests on an investor's account,
neither the Fund, the Fund's distributor nor the transfer agent will be
held responsible for any losses resulting from unauthorized transactions.

. If you purchased shares directly from the Fund, the transfer agent will
send you confirmations of the opening of an account and of all subsequent
purchases, exchanges or redemptions in the account. If your account has
been set up by a broker or other investment professional, account activity
will be detailed in their statements to you.

11
<PAGE>

. [The exchange privilege is not intended as a vehicle for short-term
trading. Excessive exchange activity may interfere with portfolio
management and have an adverse effect on all shareholders. The Fund and its
distributor reserve the right to refuse any purchase or exchange request
that could adversely affect the fund or its operations, including those
from any individual or group who, in the Fund's view, is likely to engage
in excessive trading or any order considered market-timing activity. If the
Fund refuses a purchase or exchange request and the shareholder deems it
necessary to redeem their account, any CDSC as permitted by the prospectus
will be applicable.

Additionally, in no event will the Fund permit more than six exchanges into
or out of a Fund in any one-year period per account, tax identification
number, social security number or related investment group. The Munder
Money Market Funds are exempt from this policy.]

Shareholder Privileges

Automatic Investment Plan (AIP). Under the AIP you may arrange for periodic
investments in the Fund through automatic deductions from a checking or savings
account. To enroll in the AIP you should complete the AIP application form or
call the Fund at (800) 438-5789. The minimum pre-authorized investment amount is
$50. You may discontinue the AIP at any time. We may discontinue the AIP on 30
days' written notice to you.

Reinvestment Privilege. For 60 days after you sell shares of the Fund, you may
reinvest your redemption proceeds in shares of the same class of the Fund at
NAV. Any CDSC you paid on the amount you are reinvesting will be credited to
your account. You may use this privilege once in any given twelve-month period
with respect to your shares of the Fund. You or your broker must notify the
Fund's transfer agent in writing at the time of reinvestment in order to
eliminate the sales charge on your reinvestment.

Automatic Withdrawal Plan (AWP). If you have an account value of $2,500 or more
in the Fund, you may redeem shares on a monthly, quarterly, semi-annual or
annual basis. The minimum withdrawal is $50. We usually process withdrawals on
the 20th day of the month and promptly send you your redemption amount. You may
enroll in the AWP by completing the AWP application form available through the
transfer agent. To participate in the AWP you must have your dividends
automatically reinvested and may not hold share certificates. You may change or
cancel the AWP at any time upon notice to the transfer agent. You should not buy
Class A shares (and pay a sales charge) while you participate in the AWP and you
must pay any applicable CDSCs when you redeem shares.

12
<PAGE>

Distribution Arrangements
- --------------------------------------------------------------------------------

Share Class Selection

The Fund has registered Class A, Class B and Class C shares and currently offers
Class A and Class B shares. Each class has its own cost structure, allowing you
to choose the one that best meets your requirements given the amount of your
purchase and the intended length of your investment. You should consider both
ongoing annual expenses and initial sales charge or CDSC in estimating the costs
of investing in a particular class of shares.

Class A shares
. Front end sales charge. There are several ways to reduce these sale
charges.
. Lower annual expenses than Class B and Class C shares.

The Fund also issues other classes of shares, which have different sales
charges, expense levels and performance. The other classes of shares are
available to limited types of investors. Call (800) 438-5789 to obtain more
information about those classes.

Applicable Sales Charge- Class A Shares

You can purchase Class A shares at NAV plus an initial sales charge. The sales
charge as a percentage of your investment decreases as the amount you invests
increases. The current sales charge rates and commissions paid to selected
dealers as follows:

<TABLE>
<CAPTION>
Discount
to
Selected
Sales Charge Dealers
as a Percentage of as a
------------------
Percentage
Your Net Asset of
Net Asset Value Investment
--------- --------- ----------
<S> <C> <C> <C>
Less than $100,000.... 2.50% 2.56% 2.25%
$100,000 but less
than $250,000......... 2.00% 2.04% 1.75%
$250,000 but less than
$500,000.............. 1.50% 1.52% 1.25%
$500,000 but less
than $1,000,000....... 1.00% 1.01% .75%
$1,000,000 but less
than $3,000,000....... None* None* .10%
$3,000,000 but less
than $5,000,000....... None* None* .05%
$5,000,000 or
more.................. None* None* None
</TABLE>
- ------------------
* There is no initial sales charge on purchases of $1 million or more of Class A
Shares of the Fund; however, a CDSC in the amount of the Discount to Selected
Dealers shown above will be imposed on the lower of the original purchase price
or the net asset value of the shares at the time of redemption if such shares
are redeemed within one year after the date of purchase.

Sales Charge Waivers-General
We will waive the initial sales charge on Class A shares for the following types
of purchasers:

1. individuals with an investment account or relationship with the advisor;

2. full-time employees and retired employees of the advisor, employees of the
Fund's service providers and immediate family members of such persons;

13
<PAGE>

is for their own account (or for the benefit of their families);

4. certain qualified employee benefit plans as described below;

5. individuals who reinvest a distribution from a qualified retirement plan for
which the advisor serves as investment advisor;

6. individuals who reinvest the proceeds of redemptions from Class Y Shares of
another Munder Fund within 60 days of redemption;

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

Sales Charge Waivers - Qualified Employer Sponsored Retirement Plans

Qualified Sponsored Retirement Plans and UPI Plans. We will waive the initial
sales charge on Class A Shares of the Fund for all investments by : (i) employer
sponsored retirement plans that are qualified under Section 401 (a) or Section
403(b) of the Code; (ii) employees participating in an employer-sponsored or
administered retirement program operating under Section 408A of the Code and
(iii) UPI Plans.

In addition, the CDSC of up to 0.20% imposed on certain redemptions of Class A
Shares of the Fund within one year of purchase will be waived for such accounts.
The Distributor will pay the following commissions to dealers and other entities
(as permitted by applicable Federal and state law) who initiate and are
responsible for purchases of Class A Shares of the Fund by such accounts:

<TABLE>
<CAPTION>
Discount to
Dealer or
Amount Entity as a %
Of of Offering
Purchase Price
- -------- -----
<S> <C>
Less than $1,000,000................... 0.15%
$1,000,000 but less than $3,000,000.... 0.10%
$3,000,000 but less than $5,000,000.... 0.05%
$1,000,000 or more..................... None
</TABLE>

Merrill Lynch Plans. We will waive the initial sales charge for all investments
by Merrill Lynch Plans if

(i) the Plan is recordkept on a daily valuation basis by Merrill Lynch Group
Employee Services (Merrill Lynch) and, on the date the plan sponsor signs
the Merrill Lynch Recordkeeping Service Agreement, the Plan has $3
million or more in assets invested in broker/dealer funds not advised or
managed by Merrill Lynch Asset Management, L.P. (MLAM) that are made
available pursuant to a Services Agreement between Merrill Lynch and the
Fund's distributor and in funds advised or managed by MLAM (collectively,
the Applicable Investments); or

(ii) the Plan is recordkept on a daily valuation basis by an independent
recordkeeper whose services are provided through a contract or alliance
arrangement with Merrill Lynch, and on the date the plan sponsor signs
the Merrill Lynch Recordkeeping Service Agreement, the Plan has $3
million or more in assets, excluding money market funds, invested in
Applicable Investments; or

(iii) the Plan has 500 or more eligible employees, as determined by the Merrill
Lynch plan conversion manager, on the date the plan sponsor signs the
Merrill Lynch Recordkeeping Service Agreement.

Sales Charge Reductions
You may qualify for reduced sales charges in the following cases:

. Letter of Intent. If you intend to purchase at least [$500,000] of Class A
shares of the Fund, you may wish to complete the Letter of Intent section
of your account application form. By doing so, you agree to invest a
certain amount over a 13-month period. You would pay a sales charge on any
Class A shares you purchase

14
<PAGE>

during the 13 months based on the total amount to be invested under the
Letter of Intent. You can apply any investments you made in any of the
Munder Funds during the preceding 90-day period toward fulfillment of the
Letter of Intent (although there will be no refund of sales charges you
paid during the 90-day period). You should inform the Fund's transfer agent
that you have a Letter of Intent each time you make an investment.

You are not obligated to purchase the amount specified in the Letter of
Intent. If you purchase less than the amount specified, however, you must
pay the difference between the sales charge paid and the sales charge
applicable to the purchases actually made. The custodian will hold such
amount in escrow. The Fund's custodian will pay the escrowed funds to your
account at the end of the 13 months unless you do not complete your
intended investment.

Certain brokers may not offer these programs or may impose conditions or fees to
use these programs. You should consult with your broker prior to purchasing the
Fund's shares.

For further information on sales charge reductions, call (800) 438-5789.

Cdsc

You pay a CDSC when you redeem:
. Class A shares that were bought as part of an investment of at least
[$500,000] within one year of buying them;
. Class B shares within six years of buying them;
. Class C shares within one year of buying them.

These time periods include the time you held Class B or Class C shares of
another Munder Fund which you may have exchanged for Class B or Class C shares
of the Fund.

The CDSC schedule for Class B shares purchased after June 27, 1995 is set forth
below. Consult the Statement of Additional Information for the CDSC schedule for
Class B shares purchased, or acquired through an exchange of shares of another
Munder Fund purchased, on or before June 27, 1995. The CDSC is based on the
original NAV at the time of your investment or the NAV at the time of
redemption, whichever is lower.

Years Since Purchase CDSC
- -------------------- ----
First................................. 3.00%
Second................................ 2.50%
Third................................. 2.00%
Fourth................................ 1.50%
Fifth................................. 1.00%
Sixth................................. 0.50%
Seventh and thereafter................ 0.00%

At the time of sale of Class B shares, the distributor pays sales commissions of
[2.00%] of the purchase price, to brokers that initiate and are responsible for
purchases of such Class B shares.

You will not pay a CDSC to the extent that the value of the redeemed shares
represents:
. reinvestment of dividends or capital gains distributions; or
. capital appreciation of shares redeemed.

When you redeem shares, we will assume that you are redeeming first shares
representing reinvestment of dividends and capital gains distributions, then any
appreciation on shares redeemed, and then remaining shares held by you for the
longest period of time. [We will calculate the holding period of Class B shares
of the Fund acquired through an exchange of Class B shares of the Munder Money
Market Fund (which are available only by exchange of Class B shares of a Munder
Fund) from the date that the Class B shares of the initial Munder Fund were
purchased.]

CDSC Waivers
We will waive the CDSC payable upon redemptions of shares of the Fund which you
purchased after June 27, 1995 (or acquired through an exchange of shares of
another Munder Fund purchased after June 27, 1995) for:
. redemptions made within one year after the death of a shareholder or
registered joint owner;
. minimum required distributions made from an IRA or other retirement plan
account after you reach age 70 1/2;

15
<PAGE>

. involuntary redemptions made by the Fund;
. redemptions limited to 10% per year of an account's net asset value. For
example, if you maintain an annual balance of $10,000 you can redeem up to
$1,000 annually free of charge.

We will waive the CDSC payable upon redemptions of shares of the Fund which you
purchased after December 1, 1998 (or acquired through an exchange of shares of
another Munder Fund purchased after December 1, 1998) for:
. redemptions made from an IRA or other individual retirement plan account
established through Comerica Securities, Inc. after you reach age 59 1/2
and after the eighteen month anniversary of the purchase of Fund shares.

Consult the Statement of Additional Information for Class B CDSC waivers that
apply when you redeem shares of the Fund purchased on or before June 27, 1995 or
acquired through an exchange of shares of another Munder Fund purchased on or
before June 27, 1995.

We will waive the CDSC for Class B shares for all redemptions by Merrill Lynch
Plans if:

12B-1 FEES

The Fund has adopted Rule 12b-1 plans with respect to its Class A, Class B and
Class C shares that allow the Fund to pay distribution and other fees for the
sale of its shares and for services provided to shareholders. Under the plans,
the Fund may pay up to .25% of the daily net assets of Class A, Class B and
Class C shares to pay for certain shareholder services provided by institutions
that have agreements with the Fund's distributor to provide such services. The
Fund may also pay up to .75% of the daily net assets of the Class B and Class C
shares to finance activities relating to the distribution of its shares.

Because the fees are paid out of the Fund's assets on an on-going basis, over
time these fees will increase the cost of an investment in the Fund and may cost
a shareholder more than paying other types of sales charges.

OTHER INFORMATION

The advisor, or its affiliates, may, from time to time, make payments to banks,
broker-dealers or other financial institutions for certain services to the Fund
and/or its shareholders, including sub-administration, sub-transfer agency and
shareholder servicing. The advisor, or its affiliates, may make such payments
out of its own resources and there are no additional costs to the Fund or its
shareholders.

[Please note that Comerica Bank, an affiliate of the advisor receives a fee from
the Fund for providing shareholder services to its customers who own shares of
the Fund.]

16
<PAGE>

PRICING OF FUND SHARES
- --------------------------------------------------------------------------------

The Fund's NAV is calculated on each day the New York Stock Exchange is open.
NAV is the value of a single share of the Fund. NAV is calculated by (1) taking
the current value of the Fund's total assets allocated to a particular class of
shares, (2) subtracting the liabilities and expenses charged to that class (3)
dividing that amount by the total number of shares of that class outstanding.

The Fund calculates NAV as of the close of business on the New York Stock
Exchange, normally 4:00 p.m. Eastern time. If the New York Stock Exchange closes
early, the Fund will accelerate its calculation of NAV and transaction deadlines
to that time.

NAV is generally based on the market value of the securities held by the Fund.
If market values are not available, the fair value of securities is determined
in good faith by, or using procedures approved by, the Board of Trustees of the
Fund.

DISTRIBUTIONS
- --------------------------------------------------------------------------------

As a shareholder, you are entitled to your share of the Fund's net income and
gains on its investments. The Fund passes substantially all of its earnings
along to its shareholders as distributions. When the Fund earns dividends from
stocks and interest from debt securities and distributes these earnings to
shareholders, it is called a dividend distribution. The Fund realizes capital
gains when it sells securities for a higher price than it paid. When these gains
are distributed to shareholders, it is called a capital gain distribution.

The Fund pays dividends, if any, quarterly.

The Fund distributes its net realized capital gains, if any, at least annually.

It is possible that the Fund may make a distribution in excess of the Fund's
earnings and profits. You will treat such a distribution as a return of capital
which is applied against and reduces your basis in your shares. You will treat
the excess of any such distribution over your basis in your shares as gain from
a sale or exchange of shares.

The Fund will pay distributions in additional shares of the Fund. If you wish to
receive distributions in cash, either, indicate this request on your account
application form or notify the Fund by calling (800) 438-5789.

17
<PAGE>

FEDERAL TAX CONSIDERATIONS
- --------------------------------------------------------------------------------

Investments in the Fund will have tax consequences that you should consider.
This section briefly describes some of the more common federal tax consequences.
A more detailed discussion about the tax treatment of distributions from the
Fund and about other potential tax liabilities, including backup withholding for
certain tax payers and about tax aspects of dispositions of shares of the Fund,
is contained in the Statement of Additional Information. You should consult your
tax adviser about your own particular tax situation.

TAXES ON DISTRIBUTIONS

Distributions are generally taxable to you in the tax year in which they are
paid, with one exception: distributions disclosed in October, November or
December, but not paid until January of the following year, are taxed as though
they were paid on December 31 in the year in which they were declared.

Shareholders generally are required to report all Fund distributions on their
federal income tax returns. Each year the Fund will send you information
detailing the amount of ordinary income and capital gains paid to you for the
previous year.

TAXES ON SALES OR EXCHANGES

If you sell shares of the Fund or exchange them for shares of another Munder
Fund, you generally will be subject to tax on any taxable gain. Taxable gain is
computed by subtracting your tax basis in the shares from the redemption
proceeds (in the case of a sale) or the value of the shares received (in the
case of an exchange). Because your tax basis depends on the original purchase
price and on the price at which any dividends may have been reinvested, you
should be sure to keep account statements so that you or your tax preparer will
be able to determine whether a sale or an exchange will result in a taxable
gain.

OTHER CONSIDERATIONS

If you buy shares of the Fund just before the Fund makes any distribution, you
will pay the full price for the shares and then receive back a portion of the
money you have just invested in the form of a taxable distribution.

If you have not provided complete, correct taxpayer information by law, the Fund
must withhold a portion of your distributions and redemption proceeds to pay
federal income taxes.

18
<PAGE>

MANAGEMENT
- --------------------------------------------------------------------------------

INVESTMENT ADVISOR

The Fund's investment advisor is World Asset Management, L.L.C., 255 East Brown
Street, Birmingham, Michigan, 48009. The advisor is a wholly-owned subsidiary of
Munder Capital Management. As of September 30, 1999, the advisor [and its
affiliates had approximately $__ billion in assets under management, of which
$__ billion were invested in equity securities, $__ billion were invested in
money market or other short-term instruments, $__ billion were invested in other
fixed income securities, and $__ billion in non-discretionary assets.]

The advisor provides overall investment management for the Fund and is
responsible for all purchases and sales of portfolio securities.

During the fiscal year ended June 30, 1999, the Fund paid an advisory fee equal
to .07% of the average daily net assets of the Fund (after fee waivers). Because
a portion of the advisory fee was voluntarily waived, such payments were less
than the contractual advisory fee of .20% of the first $250 million of the
Fund's average daily net assets, .12% of the next $250 million of the Fund's
average daily net assets and .07% of the Fund's average daily net assets over
$500 million, on an annual basis. The voluntary waiver has been terminated for
the current fiscal year.

PORTFOLIO MANAGERS

Todd B. Johnson and Kenneth A. Schluchter III jointly manage the Fund. Mr.
Johnson, a Chief Investment Officer of the advisor, has been the portfolio
manager of the Fund since July 1992. Mr. Schluchter, who has managed the Fund
since June 1997, was previously a Systems Developer and Data Analyst for
Compuware Incorporated (1993-1995).

19
<PAGE>

FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

The financial highlights table is intended to help shareholders understand the
financial performance of each class of shares of the Fund for the past 5 years
(or, if shorter, the period of the class's operations). Certain information
reflects financial results for a single Fund share. The total returns in the
table represent the rate that an investor would have earned (or lost) on an
investment in a particular class of the Fund (assuming reinvestment of all
dividends and distributions). Because Class C shares of the Fund were not
offered during the periods shown, financial highlights are not presented for
that class. The information has been audited by Ernst & Young LLP, independent
accountants, whose report along with the Fund's financial statements, are
included in the Fund's annual report, and are incorporated by reference into the
Statement of Additional Information. You may obtain the annual report without
charge by calling (800) 438-5789.

<TABLE>
<CAPTION>
Index 500 Fund (a)
------------------------------------------------------------------------
Year Year Year Year Period Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96(f) 6/30/95(d) 2/28/95(e,f)
Class A Class A Class A Class A Class A Class A
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......................
Income from investment operations:
Net investment income.....................................
Net realized and unrealized gain on investments...........
Total from investment operations..........................
Less distributions:
Dividends from net investment income......................
Distributions from net realized gains.....................
Total distributions.......................................
Net asset value, end of period............................
Total return (b)..........................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)......................
Ratio of operating expenses to average net assets.........
Ratio of net investment income to average net assets......
Portfolio turnover rate...................................
Ratio of operating expenses to average net assets
without waivers...........................................
</TABLE>

______________

20
<PAGE>

- --------------------------------------------------------------------
Year Year Year Year
Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96(f)
Class B Class B Class B Class B

21
<PAGE>

FOR MORE INFORMATION

More information about the Fund is available free upon request, including the
following:

ANNUAL/SEMI-ANNUAL REPORTS

You will receive unaudited semi-annual reports and audited annual reports on a
regular basis from the Fund. In addition, you will By mail also receive updated
prospectuses or supplements to this The Munder Funds prospectus. In order to
eliminate duplicate mailings, the Fund will 480 Pierce Street only send one copy
of the above communications to (1) accounts with Birmingham, MI 48009 the same
primary record owner, (2) joint tenant accounts, (3) tenant in common accounts
and (4) accounts which have the same address.

STATEMENT OF ADDITIONAL INFORMATION

Provides more details about the Fund and its policies. A current Securities and
Exchange Commission Statement of Additional Information is on file with the and
is incorporated by reference (is legally considered part of this prospectus).

TO OBTAIN INFORMATION:

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

By telephone
Call 1-800-438-5789

By mail
The Munder Funds
480 Pierce Street
Birmingham, MI 48009

On the Internet
Text-only versions of fund documents can be viewed online or downloaded from:

Securities and Exchange Commission
http://www.sec.gov

You can also obtain copies by visiting the Securities
and Exchange Commission's Public Reference Room in Washington, D.C. (phone
1-800-SEC-0330) or by sending your request and a duplicating fee to the
Securities and Exchange Commission's Public Reference Section, Washington, D.C.
20549-6009.

You may also find more information about the Fund on the Internet at:
http://www.munderfunds.com

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

The Munder Funds Trust
SEC file number: 811-5899
<PAGE>

Class Y Shares

[Munder Logo]

Prospectus

October 26, 1999

The Munder Index 500 Fund

As with all mutual funds, the Securities and
Exchange Commission has not approved or
disapproved these securities nor passed upon the
accuracy or adequacy of this prospectus. It is a
criminal offense to state otherwise.

<PAGE>

Table Of Contents

<TABLE>
<CAPTION>
<C><S>
2 Risk/Return Summary
2 Goal
2 Principal Investment Strategy
2 Principal Risks
3 Who May Want To Invest
4 Performance
5 Fees And Expenses

6 More About The Fund

9 Your Investment
9 How To Reach The Fund
9 Purchasing Shares
10 Exchanging Shares
10 Redeeming Shares
10 Additional Policies For Purchases, Exchanges And Redemptions
11 Shareholder Privileges

12 Pricing of Fund Shares

12 Distributions

13 Federal Tax Considerations
13 Taxes On Distributions
13 Taxes On Sales Or Exchanges
13 Other Considerations

14 Management
14 Investment Advisor
14 Portfolio Managers

15 Financial Highlights

Back Cover For Additional Information
</TABLE>
<PAGE>

Risk/Return Summary
- --------------------------------------------------------------------------------
This Risk/Return Summary briefly describes the goal and principal investment
strategy of the Munder Index 500 Fund and the principal risks of investing in
the Fund. For further information on the Fund's principal and other investment
strategies and risks, please read the section entitled "More About The Fund".

Goal

Principal Investment Strategy

The Fund pursues its goal by normally holding the securities of at least 400 of
the stocks in the S&P 500.

The Fund may also enter into futures contracts.

Principal Risks

An investment in the Fund is not a bank deposit and is not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other governmental agency.

The Fund is subject to the following principal investment risks:

. Stock Market Risk. The value of the securities in which the Fund invests may
decline in response to general economic conditions. Price changes may be
temporary or last for extended periods. For example, stock prices have
historically risen and fallen in periodic cycles. In addition, the value of
the Fund's investments may decline if particular companies the Fund invests
in do not perform well.

. Tracking Risk. Because the Fund pays fees and transaction costs, while the
S&P 500 does not, the Fund's returns are likely to be lower than those of the
S&P 500. Tracking variance may also result from share purchases, redemptions
and other factors.

. Indexing Strategy Risk. The Fund will invest in the securities included in
the S&P 500 regardless of market trends. As a result, the Fund cannot modify
its investment strategy to respond to changes in the economy, which means it
may be particularly susceptible to a general decline in the large
capitalization portion of the U.S. stock market.

<PAGE>

Who May Want To Invest

The Fund may be appropriate for investors:

. Looking to invest over the long term and willing to ride out market swings.

. Willing to accept greater risks than those associated with fixed income
investments.

. Looking to invest in a diversified stock portfolio focused on large
capitalization companies.

The Fund alone cannot provide a balanced investment program.

<PAGE>

Performance

When you consider this information, please remember the Fund's performance in
past years is not necessarily an indication of how the Fund will perform in the
future.

[BAR CHART]
<TABLE>
<CAPTION>
Calendar Year Total Return
<S> <C>
1992: _____%
1993: _____%
1994: _____%
1995: _____%
1996: _____%
1997: _____%
1998: _____%
</TABLE>
- ----------------
Year-to-date through September 30, 1999: _____%

Best Quarter: Q____199__ _____%
Worst Quarter: Q____199__ _____%

Average Annual Total Returns
(for the periods ended December 31, 1998)

<TABLE>
<CAPTION>
Since
Inception
1 Year 5 Years (12/1/91)
- ---------------------- ------------ --------------- ------------
<S> <C> <C> <C>
Class Y
[Index]
</TABLE>

4
<PAGE>

Fees And Expenses

The tables below describe the fees and expenses that you may pay if you buy and
hold Class Y shares the Fund. Please note that the following information does
not include fees that institutions may charge for services they provide to you.

<TABLE>
<CAPTION>
Shareholder Fees (fees paid directly from your investment)
<S> <C>
Maximum Sales Charge (Load) Imposed on Purchases..................... NONE
Sales Charge (Load) Imposed on Reinvested Dividends.................. NONE
Maximum Deferred Sales Charge (Load)................................. NONE
Redemption Fees...................................................... NONE
Exchange Fees........................................................ NONE
</TABLE>

<TABLE>
<CAPTION>
Annual Fund Operating Expenses (expenses that are paid from Fund assets)
as a % of net assets

<S> <C>
Management Fees .12%
Other Expenses [ ]%
----
Total Annual Fund Operating Expenses [ ]%
====
</TABLE>

Example

<TABLE>
<S> <C>
1 Year $
3 Years $
5 Years $
10 Years $
</TABLE>

5
<PAGE>

More About The Fund
- --------------------------------------------------------------------------------
The Fund's principal investment strategy and risks are summarized above in the
section entitled "Risk/Return Summary". A more complete description of the
Fund's investments and strategies and their associated risks is provided below.
The Fund may also invest in other securities and is subject to further
restrictions and risks which are described in the Statement of Additional
Information.

Equity Securities. The Fund invests in equity securities which include common
stocks, preferred stocks and securities convertible into common stocks.

Foreign Securities. Foreign securities include direct investments in non-U.S.
dollar-denominated securities traded outside of the United States and dollar-
denominated securities of foreign issuers traded in the United States. Foreign
securities also include indirect investments such as American Depository
Receipts ("ADRs") which are U.S. dollar-denominated receipts representing shares
of foreign-based corporations. ADRs are issued by U.S. banks or trust companies,
and entitle the holder to all dividends and capital gains that are paid out on
the underlying foreign shares.

Investment Strategy. The Fund may invest up to 25% of its total assets in
foreign securities.

Special Risks. Foreign securities involve special risks and costs.
Investment in foreign securities may involve higher costs than investment
in U.S. securities, including higher transaction and custody costs as well
as the imposition of additional taxes by foreign governments. Foreign
investments may also involve risks associated with the level of currency
exchange rates, less complete financial information about the issuers, less
market liquidity, more market volatility and political instability. Future
political and economic developments, the possible imposition of withholding
taxes on dividend income, the possible seizure or nationalization of
foreign holdings, the possible establishment of exchange controls or
freezes on the convertibility of currency, or the adoption of other
governmental restrictions might adversely affect an investment in foreign
securities. Additionally, foreign issuers may be subject to less stringent
regulation, and to different accounting, auditing and recordkeeping
requirements.

Currency exchange rates may fluctuate significantly over short periods of
time causing the Fund's net asset value to fluctuate as well. A decline in
the value of a foreign currency relative to the U.S. dollar will reduce the
value of a foreign currency-denominated security. To the extent that the
Fund is invested in foreign securities while also maintaining currency
positions, it may be exposed to greater combined risk. The Fund's
respective net currency positions may expose it to risks independent of its
securities positions.

Investment Strategy. Derivatives can be used for hedging (attempting to
reduce risk by offsetting one investment position with another) or
speculation (taking a position in the hope of increasing return). The Fund
may, but is not required to, use derivatives for hedging purposes or for
the purpose of remaining fully invested or maintaining liquidity. The Fund
will not use derivatives for speculative purposes.

Special Risks. The use of derivative instruments exposes the Fund to
additional risks and transaction costs. Risks of derivative instruments
include: (1) the risk that interest rates, securities prices and currency
markets will not move in the direction that a portfolio manager

6
<PAGE>

anticipates; (2) imperfect correlation between the price of derivative
instruments and movements in the prices of the securities, interest rates
or currencies being hedged; (3) the fact that skills needed to use these
strategies are different than those needed to select portfolio securities;
(4) the possible absence of a liquid secondary market for any particular
instrument and possible exchange imposed price fluctuation limits, either
of which may make it difficult or impossible to close out a position when
desired; (5) the risk that adverse price movements in an instrument can
result in a loss substantially greater than the Fund's initial investment
in that instrument (in some cases, the potential loss is unlimited); (6)
particularly in the case of privately-negotiated instruments, the risk that
the counterparty will not perform its obligations, which could leave the
Fund worse off than if it had not entered into the position; and (7) the
inability to close out certain hedged positions to avoid adverse tax
consequences.

Futures Contracts and Related Options. A futures contract is a type of
derivative instrument that obligates the holder to buy or sell an asset in the
future at an agreed upon price. When the Fund purchases an option on a futures
contract, it has the right to assume a position as a purchaser or seller of a
futures contract at a specified exercise price during the option period. When
the Fund sells an option on a futures contract, it becomes obligated to purchase
or sell a futures contract if the option is exercised.

Investment Strategy. The Fund may invest in futures contracts and options
on futures contracts on domestic or foreign exchanges or boards of trade.
These instruments may be used for hedging purposes, to maintain liquidity
to meet potential shareholder redemptions, to invest cash balances or
dividends, or to minimize trading costs.

Special Risks. Futures contracts and related options present the following
risks: imperfect correlation between the change in market value of the
Fund's securities and the price of futures contracts and options; the
possible inability to close a futures contract when desired; losses due to
unanticipated market movements, which are potentially unlimited; and the
possible inability of the advisor to correctly predict the direction of
securities prices, interest rates, currency exchange rates and other
economic factors.

Investment Strategy. Securities lending may represent no more than 25% of
the value of the Fund's total assets (including the loan collateral).

Special Risks. The main risk when lending Fund securities is that if the
borrower fails to return the securities or the invested collateral has
declined in value, the Fund could lose money.

Investment Strategy. The Fund may borrow money in an amount up to 5% of its
assets for temporary emergency purposes and in an amount up to 33 1/3% of
its assets to meet redemptions. This is a fundamental policy which can be
changed only by shareholders.

Special Risks. Borrowings and reverse repurchase agreements by the Fund may
involve leveraging. If the securities held by the Fund decline in value
while these transactions are outstanding, the Fund's net asset value will
decline in value by proportionately more than the decline in value of the
securities. In addition, reverse repurchase agreements involve the risks
that the interest income earned by the Fund

7
<PAGE>

(from the investment of the proceeds) will be less than the interest
expense of the transaction, that the market value of the securities sold by
the Fund will decline below the price the Fund is obligated to pay to
repurchase the securities, and that the securities may not be returned to
the Fund.

8
<PAGE>

Your Investment
- -------------------------------------------------------------------------------

This section describes how to do business with the Fund.

How To Reach The Fund

By telephone: 1-800-438-5789
Call for account information

By mail: The Munder Funds
480 Pierce Street
Birmingham, MI 48009

Purchasing Shares

Who May Purchase Shares

The following persons may purchase shares of the Fund:

. fiduciary and discretionary accounts of institutions

. directors, trustees, officers and employees of the Munder Funds, the
advisor and the Fund's distributor;

. the advisor's investment advisory clients

. family members of employees of the advisor.

The Fund also issues other classes of shares, which have different sales
charges, expense levels and performance. Call (800) 438-5789 to obtain more
information concerning the Fund's other classes of shares.

Purchase Price of Shares

Class Y shares of the Fund are sold at the net asset value per share (NAV) next
determined after a purchase order is received in proper form.

Broker-dealers (other than the Fund's distributor) may charge you a fee for
shares you purchase through them.

Policies for Purchasing Shares

Minimum initial investment

The minimum initial investment by fiduciary and discretionary accounts of
institutions and by institutional investors is $500,000. Other investors are not
subject to any minimum.

There is no minimum for subsequent investments.

Timing of orders

Purchase orders must be received by the Fund's distributor or the transfer agent
before the close of regular trading on the New York Stock Exchange (normally,
4:00 p.m. Eastern time).

Methods for Purchasing Shares

You can purchase Class Y shares through the Fund's transfer agent or through the
Fund's distributor through arrangements with a broker-dealer or financial
institution.

. Through a Financial Institution. You may purchase shares through a financial
institution through procedures established with that institution.
Confirmations of share purchases will be sent to the institution.

. By Mail. You may open an account directly through the Fund's transfer agent
by completing, signing and mailing an account application form and a check or
other negotiable bank draft (payable to The Munder Funds) to: The Munder
Funds, c/o First Data Investor Services Group, P.O. Box 60428, King of
Prussia, Pennsylvania 19406-0428. You can obtain an account application form
by calling (800) 438-5789. For additional investments, send a letter stating
the Fund and share class you wish to purchase, your name and your account
number with a check for $50 or more to the address listed above. [We do not
generally accept third-party checks.]

. [By Wire. To open a new account, you should call the Fund at (800) 438-5789
to obtain an account number and complete wire instructions prior to wiring
any funds. Within seven days of purchase, you must send a completed account
application form containing your certified taxpayer identification number to
the transfer agent at the address provided above. Wire

9
<PAGE>

instructions must state the Fund name, share class, your registered name and
your account number. Your bank wire should be sent through the Federal
Reserve Bank Wire System to:

Boston Safe Deposit and Trust Company
Boston, MA
ABA# 011001234
DDA# 16-798-3
Account No.:

You may make additional investments at any time using the wire procedures
described above. Note that banks may charge fees for transmitting wires.]

. You may purchase shares through the Automatic Investment Plan.

Exchanging Shares

Policies for Exchanging Shares

. You may exchange your Fund shares for Class Y shares of other Munder Funds
based on their relative net asset values.

. You must meet the minimum purchase requirements for the Munder Fund that you
purchase by exchange.

. A share exchange is a taxable event and, accordingly, you may realize a
taxable gain or loss.

. Before making an exchange request, read the prospectus of the Munder Fund you
wish to purchase by exchange. You can obtain a prospectus for any Munder Fund
by contacting your broker or the Munder Funds at (800) 438-5789.

. Brokers may charge you a fee for handling exchanges.

. We may modify or terminate the exchange privilege at any time. You will be
given notice of any material modifications except where notice is not
required.

[Method for Exchanging Shares?]

Redeeming Shares

Redemption Price

We will redeem shares at the NAV next determined after we receive the redemption
request in proper form.

Methods for Redeeming Shares

. Redemption requests are effected at the NAV next determined after the
transfer agent receives the order in proper form.

. [You may redeem shares of the Fund through your [broker-dealer] or financial
institution.]

[other methods]

Policies for Redeeming Shares

. Shares held by an institution on behalf of its customers must be redeemed in
accordance with instructions and limitations pertaining to the account at
that institution.

. If we receive a redemption order for the Fund before 4:00 p.m. (Eastern
time), we will normally wire payment to the redeeming institution on the next
business day.

Additional Policies For Purchases, Exchanges and Redemptions

. We consider requests to be in "proper form" when all required documents
are properly completed, signed and received.

. The Fund reserves the right to reject any purchase order.

. At any time, the Fund may change any of its purchase, redemption or
exchange practices, and may suspend the sale of its shares.

. The Fund may delay sending redemption proceeds for up to seven days, or
longer if permitted by the Securities and Exchange Commission.

. To limit the Funds expenses, we do not currently issue share
certificates.

10
<PAGE>

has cleared, which may be as long as 15 days.

. The Fund may temporarily stop redeeming shares if:

. the New York Stock Exchange is closed;

. trading on the New York Stock Exchange is restricted;

. an emergency exists and the Fund cannot sell its assets or accurately
determine the value of its assets; or

. the Securities and Exchange Commission orders the Fund to suspend
redemptions.

. The Fund reserves the right to make payment for redeemed shares wholly
or in part by giving the redeeming shareholder portfolio securities. The
shareholder may pay transaction costs to dispose of these securities.

. We record all telephone calls for your protection and take measures to
identify the caller. As long as the Fund's transfer agent takes
reasonable measures to authenticate telephone requests on an investor's
account, neither the Fund, the Fund's distributor nor the transfer agent
will be held responsible for any losses resulting from unauthorized
transactions.

. We may redeem your account if its value falls below $250 as a result of
redemptions (but not as a result of a decline in net asset value). You
will be notified in writing and allowed 60 days to increase the value of
your account to the minimum investment level.

. If you purchased shares directly through the Fund's transfer agent, the
transfer agent will send you confirmations of the opening of an account
and of all subsequent purchases, exchanges or redemptions in the
account. Confirmations of transactions effected through an institution
will be sent to the institution.

. Financial institutions are responsible for transmitting orders and
payments for their customers on a timely basis.

Shareholder Privileges

11
<PAGE>

Pricing Of Fund Shares
- -------------------------------------------------------------------------------

The Fund's NAV is calculated on each day the New York Stock Exchange is open.
NAV is the value of a single share of the Fund. NAV for Class Y shares is
calculated by (1) taking the current value of the Fund's total assets allocated
to that class of shares, (2) subtracting the liabilities and expenses charged to
that class (3) dividing that amount by the total number of shares of that class
outstanding.

Trading in foreign securities may be completed at times that vary from the
closing of the New York Stock Exchange. The Fund values foreign securities at
the latest closing price on the exchange on which they are traded immediately
prior to the closing of the New York Stock Exchange. Certain foreign currency
exchange rates may also be determined at the latest rate prior to the closing of
the New York Stock Exchange. Foreign securities quoted in foreign currencies are
translated into U.S. dollars at current rates. Occasionally, events that affect
these values and exchange rates may occur between the times at which they are
determined and the closing of the New York Stock Exchange. If the advisor
believes that such events materially affect the value of portfolio securities,
these securities may be valued at their fair market value as determined in good
faith by, or using procedures approved by, the Fund's Board of Trustees.

Foreign securities may trade in their primary markets on weekends or other days
when the Fund does not price its shares. Therefore, the value of the Fund's
portfolio may change on days when shareholders will not be able to buy or sell
their shares.

Distributions
- -------------------------------------------------------------------------------

The Fund pays dividends, if any, quarterly.

The Fund distributes its net realized capital gains, if any, at least annually.

The Fund will pay distributions in additional shares of the Fund. If you wish to
receive distributions in cash, either indicate this request on your account
application form or notify the Fund by calling (800) 438-5789.

<PAGE>

Federal Tax Considerations
- -------------------------------------------------------------------------------

Investments in the Fund will have tax consequences that you should consider.
This section briefly describes some of the more common federal tax consequences.
A more detailed discussion about the tax treatment of distributions from the
Fund and other potential tax liabilities, including backup withholding for
certain shareholders and about tax aspects of dispositions of shares of the Fund
is contained in the Statement of Additional Information. You should consult your
tax adviser about your own particular tax situation.

Taxes On Distributions

Distributions that are derived from net long-term capital gains generally will
be taxed as long-term capital gains. Dividend distributions and short-term
capital gains generally will be taxed as ordinary income. The tax you pay on a
given capital gains distribution generally depends on how long the Fund held
the portfolio securities it sold. It does not depend on how long you held the
Fund shares.

Distributions are generally taxable to you in the tax year in which they are
paid, with one exception: distributions declared in October, November, or
December, but not paid until January of the next following year, are taxed as
though they were paid on December 31 in the year in which they are paid.

Taxes On Sales Or Exchanges

If you sell shares of the Fund or exchange them for shares of another Fund, you
generally will be subject to tax on any taxable gain. Your taxable gain is
computed by subtracting your tax basis in the shares from the redemption
proceeds (in the case of a sale) or the value of the shares received (in the
case of an exchange). Because your tax basis depends on the original purchase
price and on the price at which any dividends may have been reinvested, you
should be sure to keep account statements so that you or your tax preparer will
be able to determine whether a sale or an exchange will result in a taxable
gain.

Other Considerations

If you have not provided complete, correct taxpayer information by law, the Fund
must withhold a portion of your distributions and redemption proceeds to pay
federal income taxes.

13
<PAGE>

Management
- -------------------------------------------------------------------------------

Investment Advisor

The advisor provides overall investment management for the Fund and is
responsible for all purchases and sales of portfolio securities.

During the fiscal year ended June 30, 1999, the Fund paid an advisory fee equal
to .07% of the average daily net assets of the Fund ( after fee waivers).
Because a portion of the advisory fee was voluntarily waived, such payments were
less than the contractual advisory fee of .20% of the first $250 million of the
Fund's average daily net assets, .12% of the next $250 million of the Fund's
average daily net assets and .07% of the Fund's average daily net assets over
$500 million, on an annual basis. The voluntary waiver has been terminated for
the current fiscal year.

Portfolio Managers

Todd B. Johnson and Kenneth A. Schluchter III jointly manage the Fund.
Mr. Johnson, a Chief Investment Officer of the advisor, has been the portfolio
manager of the Fund since July 1992. Mr. Schluchter, who has managed the Fund
since June 1997, was previously a Systems Developer and Data Analyst for
Compuware Incorporated (1993-1995).

14
<PAGE>

Financial Highlights
- -------------------------------------------------------------------------------

The financial highlights table is intended to help shareholders understand the
financial performance of Class Y shares of the Fund for the period of the
Class Y shares operations. Certain information reflects financial results for a
single Fund share. The total returns in the table represent the rate that an
investor would have earned (or lost) on an investment in the Fund (assuming
reinvestment of all dividends and distributions). The information has been
audited by Ernst & Young LLP, independent accountants, whose report along with
the Fund's financial statements, are included in the Fund's annual report, and
are incorporated by reference into the Statement of Additional Information. You
may obtain the annual report without charge by calling (800) 438-5789.
<TABLE>
<CAPTION>
Index 500 Fund (a)
--------------------------------------------------------------------
Year Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
6/30/99 6/30/98 6/30/97 6/30/96(f) 6/30/95(d) 2/28/95
------- ------- ------- ---------- ---------- -------
<S> <C> <C> <C> <C> <C> <C>

Net asset value, beginning of period...................
Income from investment operations:
Net investment income..................................
Net realized and unrealized gain on investments........
Total from investment operations.......................
Less distributions:
Dividends from net investment income...................
Distributions from net realized gains..................
Total distributions....................................
Net asset value, end of period.........................
Total return (b).......................................

Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)...................
Ratio of operating expenses to average net assets......
Ratio of net investment income to average net assets...
Portfolio turnover rate................................
Ratio of operating expenses to average net assets
without waivers.......................................
- ----------------
</TABLE>
15
<PAGE>

For More Information

More information about the Fund is available free upon request, including the
following:

Annual/Semi-Annual Reports

You will receive unaudited semi-annual reports and audited annual reports on a
regular basis from the Fund. In addition, you will also receive updated
Prospectuses or Supplements to this Prospectus. In order to eliminate duplicate
mailings, the Fund will only send one copy of the above communications to (1)
accounts with the same primary record owner, (2) joint tenant accounts, (3)
tenant in common accounts and (4) accounts which have the same address.

Statement Of Additional Information

Provides more details about the Fund and its policies. A current Statement of
Additional Information is on file with the Securities and Exchange Commission
and is incorporated by reference (is legally considered part of this
prospectus).

To Obtain Information:

By telephone
Call 1-800-438-5789

By mail
The Munder Funds
480 Pierce Street
Birmingham, MI 48009

On the Internet
Text-only versions of fund documents can be viewed online or downloaded from:

Securities and Exchange Commission
http://www.sec.gov

You may also find more information about the Fund on the Internet at:
http://www.munderfunds.com

The Munder Funds Trust
SEC file number: 811-5899
<PAGE>

THE MUNDER FUNDS, INC., THE MUNDER FUNDS TRUST
AND THE MUNDER FRAMLINGTON FUNDS TRUST

<TABLE>
<CAPTION>
<S> <C>
Munder Balanced Fund Munder Framlington International Growth Fund
Munder Equity Selection Fund Munder Bond Fund
Munder Index 500 Fund Munder Intermediate Bond Fund
Munder Growth Opportunities Fund Munder International Bond Fund
Munder Growth & Income Fund Munder Short Term Treasury Fund
Munder International Equity Fund Munder U.S. Government Income Fund
Munder Micro-Cap Equity Fund Munder Michigan Tax-Free Bond Fund
Munder Multi-Season Growth Fund Munder Tax-Free Bond Fund
Munder NetNet Fund Munder Tax-Free Short-Intermediate Bond Fund
Munder Real Estate Equity Investment Fund (formerly Munder Tax-Free Intermediate Bond Fund)
Munder Small-Cap Value Fund Munder Cash Investment Fund
Munder Small Company Growth Fund Munder Money Market Fund
Munder Value Fund Munder Tax-Free Money Market Fund
Munder Framlington Emerging Markets Fund Munder U.S. Treasury Money Market Fund
Munder Framlington Global Financial Services Fund
Munder Framlington Healthcare Fund
</TABLE>

(collectively, the "Funds")

STATEMENT OF ADDITIONAL INFORMATION
October 26, 1999

This Statement of Additional Information ("SAI"), which has been filed with
the Securities and Exchange Commission (the "SEC"), provides supplementary
information pertaining to all classes of shares representing interests in each
of the investment portfolios listed above. The Munder Funds, Inc. (the
"Company") currently offers a selection of fifteen investment portfolios, eleven
of which are described in this SAI; The Munder Funds Trust (the "Trust")
currently offers a selection of fourteen investment portfolios, each of which is
described in this SAI; and The Munder Framlington Funds Trust ("Framlington")
currently offers a selection of four investment portfolios, each of which is
described in this SAI. This SAI is not a prospectus, and should be read only in
conjunction with the Company's, the Trust's, and Framlington's Prospectuses
dated October 26, 1999. A copy of each Prospectus may be obtained through Funds
Distributor, Inc. (the "Distributor"), or by calling (800) 438-5789. [The
financial statements for the Company, the Trust and Framlington including notes
thereto, dated June 30, 1999 are incorporated by reference into this SAI from
the annual reports of the Company, the Trust and Framlington.]

An investment in a Fund is not a bank deposit and is not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other governmental
agency.
<PAGE>

TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
History and General Information......................................... 3
Fund Investments........................................................ 4
Risk Factors and Special Considerations -- Index 500 Fund............... 18
Risk Factors and Special Considerations -- Michigan Tax-Free Bond Fund
and Tax-Free Short-Intermediate Bond Fund............................... 20
Investment Limitations.................................................. 22
Temporary Defensive Position............................................ 27
Management of the Fund.................................................. 27
Investment Advisory and Other Service Arrangements...................... 32
Portfolio Transactions.................................................. 45
Additional Purchase and Redemption Information.......................... 47
Net Asset Value......................................................... 51
Performance Information................................................. 52
Taxes................................................................... 60
Additional Information Concerning Shares................................ 67
Other Information....................................................... 69
Registration Statement.................................................. 69
Financial Statements.................................................... 70
Appendix A.............................................................. A-1
Appendix B.............................................................. B-1
</TABLE>

No person has been authorized to give any information or to make any
representations not contained in this SAI or in each Prospectus in connection
with the offering made by each Prospectus and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Funds or the Distributor. The Prospectuses do not constitute an offering
by the Funds or by the Distributor in any jurisdiction in which such offering
may not lawfully be made.

2
<PAGE>

HISTORY AND GENERAL INFORMATION

The following Funds are described in this SAI:

The Munder Funds Trust
- ----------------------

Munder Balanced Fund ("Balanced Fund")
Munder Growth & Income Fund ("Growth & Income Fund")
Munder Index 500 Fund ("Index 500 Fund")
Munder International Equity Fund ("International Equity Fund")
Munder Small Company Growth Fund ("Small Company Growth Fund")
Munder Bond Fund ("Bond Fund")
Munder Intermediate Bond Fund ("Intermediate Bond Fund")
Munder U.S. Government Income Fund ("U.S. Income Fund")
Munder Michigan Tax-Free Bond Fund ("Michigan Bond Fund")
Munder Tax-Free Bond Fund ("Tax-Free Bond Fund")

Munder Tax-Free Short-Intermediate Bond Fund ("Tax-Free Short-Intermediate Bond
Fund")
Munder Cash Investment Fund ("Cash Investment Fund")
Munder Tax-Free Money Market Fund ("Tax-Free Money Market Fund")
Munder U.S. Treasury Money Market Fund ("U.S. Treasury Money Market Fund")

The Munder Funds, Inc.
- ----------------------

Munder Equity Selection Fund ("Equity Selection Fund")
Munder Growth Opportunities Fund ("Growth Opportunities Fund")
Munder Micro-Cap Equity Fund ("Micro-Cap Fund")
Munder Multi-Season Growth Fund ("Multi-Season Fund")
Munder NetNet Fund ("NetNet Fund")
Munder Real Estate Equity Investment Fund ("Real Estate Fund")
Munder Small-Cap Value Fund ("Small-Cap Value Fund")
Munder Value Fund ("Value Fund")
Munder International Bond Fund ("International Bond Fund")
Munder Short Term Treasury Fund ("Short Term Treasury Fund")
Munder Money Market Fund ("Money Market Fund")

The Munder Framlington Funds Trust
- ----------------------------------

Munder Framlington Emerging Markets Fund ("Emerging Markets Fund")
Munder Framlington Global Financial Services Fund ("Global Financial Services
Fund")
Munder Framlington Healthcare Fund ("Healthcare Fund")
Munder Framlington International Growth Fund ("International Growth Fund")

The Company, the Trust and Framlington are each open-end investment
management companies. All of the Funds are diversified except for the
International Bond Fund, the Michigan Bond Fund and the Tax-Free
Short-Intermediate Bond Fund.

The Trust was organized on August 30, 1989 under the name "PDB Fund," which
was changed in November 1989 to "Opportunity Funds," in February 1990 to
"Ambassador Funds" and in June 1995 to "The Munder Funds Trust." The Tax-Free
Short-Intermediate Bond Fund originally commenced operations on February 9, 1987
under the name Tax-Free Intermediate Bond Fund as a separate portfolio of the
St. Clair Tax-Free Fund, Inc. On November 20, 1992, the St. Clair Tax-Free
Intermediate Bond Fund was reorganized as the Ambassador Tax-Free Intermediate
Bond Fund. The Company was organized as a Maryland corporation on November 18,
1992. Framlington was organized as a Massachusetts business trust on October 30,
1996.

3
<PAGE>

As stated in each Prospectus, the investment advisor of each Fund (other
than the Index 500 Fund and the International Equity Fund) is Munder Capital
Management (the "Advisor"). The principal partners of the Advisor are Old MCM,
Inc. ("Old MCM"), Munder Group LLC, WAM Holdings, Inc. ("WAM") and WAM Holdings
II, Inc. ("WAM II"). Old MCM was founded in April 1985 as a Delaware corporation
and was a registered investment advisor. WAM and WAM II are indirect, wholly-
owned subsidiaries of Comerica Incorporated which owns or controls approximately
88% of the partnership interests in the Advisor.

World Asset Management, L.L.C. ("World"), a Delaware limited liability
company, is the investment advisor for the Index 500 Fund and the International
Equity Fund. World is a wholly-owned subsidiary of the Advisor.

Framlington Overseas Investment Management Limited (the "Sub-Advisor")
serves as sub-advisor for the Emerging Markets, Global Financial Services,
Healthcare and International Growth Funds (the "Framlington Funds"). The Sub-
Advisor is a subsidiary of Framlington Group Limited, incorporated in England
and Wales which, through its subsidiaries, provides a wide range of investment
services. Framlington Group Limited is a wholly-owned subsidiary of Framlington
Holdings Limited which is, in turn, owned 49% by the Advisor and 51% by Credit
Commercial de France S.A., a French banking corporation listed on the Societe
des Bourses Francaises.

Capitalized terms used in this SAI and not otherwise defined have the same
meanings as are given to them in each Prospectus.

FUND INVESTMENTS

The following supplements the information contained in each Prospectus
concerning the investment objectives and policies of the Funds. With the
exception of the investment objectives of Multi-Season Fund, Real Estate Fund
and Money Market Fund, each Fund's investment objective is a non-fundamental
policy and may be changed without the authorization of the holders of a majority
of the Fund's outstanding shares. The Tax-Free Bond Fund and Tax-Free Money
Market Fund each have a fundamental policy to invest at least 80% of its
respective assets in municipal obligations bearing tax-exempt interest; all
other investment policies, other than those specifically designated as
fundamental, are non-fundamental policies and may be changed without the
authorization of the holders of a majority of a Fund's outstanding shares. There
can be no assurance that a Fund will achieve its objective.

A description of applicable credit ratings is set forth in Appendix A to
this SAI.

For purposes of this SAI, the Equity Selection Fund, Global Financial
Services Fund, Growth & Income Fund, Growth Opportunities Fund, Index 500 Fund,
International Equity Fund, Micro-Cap Fund, Multi-Season Fund, NetNet Fund, Real
Estate Fund, Small-Cap Value Fund, Small Company Growth Fund, Value Fund,
International Growth Fund, Emerging Markets Fund and Healthcare Fund are
referred to as the "Equity Funds"; the Bond Fund, Intermediate Bond Fund and
U.S. Income Fund are referred to as the "Bond Funds"; the Michigan Bond Fund,
Tax-Free Bond Fund and Tax-Free Short-Intermediate Bond Fund are referred to as
the "Tax-Free Bond Funds" and Cash Investment Fund, Money Market Fund, Tax-Free
Money Fund and U.S. Treasury Money Market Fund are referred to as the "Money
Market Funds."

Borrowing. Each of the Funds is authorized to borrow money in amounts up
to 5% of the value of its total assets at the time of such borrowings for
temporary purposes, and are authorized to borrow money in excess of the 5% limit
as permitted by the Investment Company Act of 1940, as amended (the "1940 Act"),
to meet redemption requests. This borrowing may be unsecured. The 1940 Act
requires the Funds to maintain continuous asset coverage of 300% of the amount
borrowed. If the 300% asset coverage should decline as a result of market
fluctuations or other reasons, the Funds may be required to sell some of their
portfolio holdings within three days to reduce the debt and restore the 300%
asset coverage, even though it may be disadvantageous from an investment
standpoint to sell securities at that time. Borrowed funds are subject to
interest costs that may or may not be offset by amounts earned on the borrowed
funds. A Fund may also be required to maintain minimum average balances in
connection with such borrowing or to pay a commitment or other fees to maintain
a line of credit; either of these

4
<PAGE>

requirements would increase the cost of borrowing over the stated interest rate.
Each Fund may, in connection with permissible borrowings, transfer as collateral
securities owned by the Fund.

Foreign Securities. Each Equity Fund (except Global Financial Services
Fund, Real Estate Fund, International Equity Fund, International Growth Fund,
Emerging Markets Fund and Healthcare Fund), each Bond Fund, each Tax-Free Bond
Fund, the Balanced Fund, the Cash Investment Fund and the Money Market Fund may
invest up to 25% of its assets in foreign securities. Under normal market
conditions, the International Equity Fund, International Bond Fund and
International Growth Fund will each invest at least 65% of its assets in
securities of issuers located in at least three countries other than the United
States. The Global Financial Services Fund will invest at least 65% of its
assets in securities of issuers located in at least three countries, one of
which may be the United States. The Emerging Markets Fund will invest at least
65% of its assets in emerging market countries. There is no limit on the
Healthcare Fund's investments in foreign securities. The Multi-Season Fund and
NetNet Fund typically will only purchase foreign securities which 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. ADRs are receipts typically issued by a United
States bank or trust company evidencing ownership of the underlying foreign
securities. Certain institutions issuing ADRs may not be sponsored by the
issuer. A non-sponsored depositary may not provide the same shareholder
information that a sponsored depositary is required to provide under its
contractual arrangements with the issuer.

The International Bond Fund will primarily invest in foreign debt
obligations denominated in foreign currencies, including the European Currency
Unit ("ECU"), which are issued by foreign governments and governmental agencies,
instrumentalities or political subdivisions; debt securities issued or
guaranteed by supranational organizations (as defined below); corporate debt
securities; bank or bank holding company debt securities and other debt
securities including those convertible into foreign stock. Certain European
currencies are being converted into the Euro. This conversion, which is under
way, is scheduled to be completed in the year 2002. However, problems with the
conversion process and delays could increase volatility in world markets and
affect European Markets in particular. For the purposes of the 65% minimum with
respect to the International Bond Fund's designation as an international bond
fund, the securities described in this paragraph are considered "international
bonds."

Income and gains on foreign securities may be subject to foreign
withholding taxes. Investors should consider carefully the substantial risks
involved in securities of companies and governments of foreign nations, which
are in addition to the usual risks inherent in domestic investments. There may
be less publicly available information about foreign companies comparable to the
reports and ratings published about companies in the United States. Foreign
companies are not generally subject to uniform accounting, auditing and
financial reporting standards, and auditing practices and requirements may not
be comparable to those applicable to United States companies. Foreign markets
have substantially less trading volume than the New York Stock Exchange and
securities of some foreign companies are less liquid and more volatile than
securities of comparable United States companies. [Commission rates in foreign
countries, which are generally fixed rather than subject to negotiation as in
the United States, are likely to be higher.] In many foreign countries there is
less government supervision and regulation of stock exchanges, brokers, and
listed companies than in the United States. Such concerns are particularly
heightened for emerging markets and Eastern European countries.

Investments in companies domiciled in developing countries may be subject
to potentially higher risks than investments in developed countries. These risks
include (i) less social, political and economic stability; (ii) the small
current size of the markets for such securities and the currently low or
nonexistent volume of trading, which result in a lack of liquidity and in
greater price volatility; (iii) certain national policies which may restrict a
Fund's investment opportunities, including restrictions on investment in issuers
or industries deemed sensitive to national interest; (iv) foreign taxation; (v)
the absence of developed legal structures governing private or foreign
investment or allowing for judicial redress for injury to private property; (vi)
the absence, until recently in certain Eastern European countries, of a capital
market structure or market-oriented economy; and (vii) the possibility that
recent favorable economic developments in Eastern Europe may be slowed or
reversed by unanticipated political or social events in such countries.

Investments in Eastern European countries may involve risks of
nationalization, expropriation and confiscatory taxation. The Communist
governments of a number of Eastern European countries expropriated large

5
<PAGE>

amounts of private property in the past, in many cases without adequate
compensation, and there can be no assurance that such expropriation will not
occur in the future. In the event of such expropriation, the Fund could lose a
substantial portion of any investments it has made in the affected countries.
Further, no accounting standards exist in Eastern European countries. Finally,
even though certain Eastern European currencies may be convertible into United
States dollars, the conversion rates may be artificial rather than their actual
market values and they may be adverse to a Fund.

The Advisor, World or the Sub-Advisor endeavors to buy and sell foreign
currencies on as favorable a basis as practicable. Some price spread on currency
exchange (to cover service charges) may be incurred, particularly when the Fund
changes investments from one country to another or when proceeds of the sale of
Fund shares in U.S. dollars are used for the purchase of securities in foreign
countries. Also, some countries may adopt policies which would prevent the Fund
from transferring cash out of the country or withhold portions of interest and
dividends at the source. There is the possibility of expropriation,
nationalization or confiscatory taxation, withholding and other foreign taxes on
income or other amounts, foreign exchange controls (which may include suspension
of the ability to transfer currency from a given country), default in foreign
government securities, political or social instability or diplomatic
developments that could affect investments in securities of issuers in foreign
nations.

Foreign securities markets have different clearance and settlement
procedures, and in certain markets there have been times when settlements have
been unable to keep pace with the volume of securities transactions, making it
difficult to conduct such transactions. Delays in settlement could result in
temporary periods when assets of a Fund are uninvested and no return is earned
thereon. The inability of a Fund to make intended security purchases due to
settlement problems could cause the Fund to miss attractive investment
opportunities. Inability to dispose of portfolio securities due to settlement
problems could result either in losses to a Fund due to subsequent declines in
value of the portfolio security or, if the fund has entered into a contract to
sell the security, could result in possible liability to the purchaser.

A Fund may be affected either unfavorably or favorably by fluctuations in
the relative rates of exchange between the currencies of different nations, by
exchange control regulations and by indigenous economic and political
developments. Changes in foreign currency exchange rates will influence values
within a Fund from the perspective of U.S. investors, and may also affect the
value of dividends and interest earned, gains and losses realized on the sale of
securities, and net investment income and gains, if any, to be distributed to
shareholders by a Fund. The rate of exchange between the U.S. dollar and other
currencies is determined by the forces of supply and demand in the foreign
exchange markets. These forces are affected by the international balance of
payments and other economic and financial conditions, government intervention,
speculation and other factors. The Advisor, World or the Sub-Advisor, will
attempt to avoid unfavorable consequences and to take advantage of favorable
developments in particular nations where, from time to time, it places a Fund's
investments.

The exercise of this flexible policy may include decisions to purchase
securities with substantial risk characteristics and other decisions such as
changing the emphasis on investments from one nation to another and from one
type of security to another. Some of these decisions may later prove profitable
and others may not. No assurance can be given that profits, if any, will exceed
losses.

Forward Currency Transactions. In order to protect against a possible loss
on investments resulting from a decline or appreciation in the value of a
particular foreign currency against the U.S. dollar or another foreign currency,
the Equity Funds (excluding the Real Estate Fund), the Balanced Fund, the Bond
Funds and the International Bond Fund are authorized to enter into forward
currency exchange contracts ("forward currency contracts"). These contracts
involve an obligation to purchase or sell a specified currency at a future date
at a price set at the time of the contract. Forward currency contracts do not
eliminate fluctuations in the values of portfolio securities but rather allow a
Fund to establish a rate of currency exchange for a future point in time.

When entering into a contract for the purchase or sale of a security, a
Fund may enter into a forward currency contract for the amount of the purchase
or sale price to protect against variations, between the date the

6
<PAGE>

security is purchased or sold and the date on which payment is made or received,
in the value of the foreign currency relative to the U.S. dollar or other
foreign currency.

When the Advisor, World or the Sub-Advisor anticipates that a particular
foreign currency may decline substantially relative to the U.S. dollar or other
leading currencies, in order to reduce risk, a Fund may enter into a forward
contract to sell, for a fixed amount, the amount of foreign currency
approximating the value of some or all of the Fund's securities denominated in
such foreign currency. Similarly, when the obligations held by a Fund create a
short position in a foreign currency, the Fund may enter into a forward contract
to buy, for a fixed amount, an amount of foreign currency approximating the
short position. With respect to any forward currency contract, it will not
generally be possible to match precisely the amount covered by that contract and
the value of the securities involved due to the changes in the values of such
securities resulting from market movements between the date the forward contract
is entered into and the date it matures. In addition, while forward contracts
may offer protection from losses resulting from declines or appreciation in the
value of a particular foreign currency, they also limit potential gains which
might result from changes in the value of such currency. A Fund will also incur
costs in connection with forward currency contracts and conversions of foreign
currencies and U.S. dollars.

Cash or liquid securities equal to the amount of a Fund's assets that could
be required to consummate forward contracts will be designated on the records of
the Funds' custodian except to the extent the contracts are otherwise "covered."
For the purpose of determining the adequacy of the designated securities, the
designated securities will be valued at market or fair value. If the market or
fair value of such securities declines, additional cash or securities will be
designated daily so that the value of the designated securities will equal the
amount of such commitments by the Fund. A forward contract to sell a foreign
currency is "covered" if a Fund owns the currency (or securities denominated in
the currency) underlying the contract, or holds a forward contract (or call
option) permitting the Fund to buy the same currency at a price no higher than
the Fund's price to sell the currency. A forward contract to buy a foreign
currency is "covered" if a Fund holds a forward contract (or put option)
permitting the Fund to sell the same currency at a price as high as or higher
than the Fund's price to buy the currency.

Futures Contracts And Related Options. The Equity Funds, the Balanced
Fund, the Bond Funds, the Tax-Free Bond Funds and the International Bond Fund
may purchase and sell futures contracts on interest-bearing securities or
securities indices, and may purchase and sell call and put options on futures
contracts. For a detailed description of futures contracts and related options,
see Appendix B to this SAI.

Illiquid Securities. The Equity Funds, Balanced Fund, Tax-Free Bond Funds,
International Bond Fund and the Bond Funds may invest up to 15%, and each of the
Money Market Funds may invest up to 10%, of the value of its net assets
(determined at time of acquisition) in securities that are illiquid. Illiquid
securities would generally include securities for which there is a limited
trading market, repurchase agreements and time deposits with notice/termination
dates in excess of seven days, and certain securities that are subject to
trading restrictions because they are not registered under the Securities Act of
1933, as amended (the "Act"). If, after the time of acquisition, events cause
this limit to be exceeded, the Fund will take steps to reduce the aggregate
amount of illiquid securities as soon as reasonably practicable in accordance
with the policies of the SEC.

Each Fund (except U.S. Treasury Money Market Fund and Short Term Treasury
Fund) may invest in commercial obligations issued in reliance on the "private
placement" exemption from registration afforded by Section 4(2) of the Act
("Section 4(2) paper"). A Fund may also purchase securities that are not
registered under the Act, but which can be sold to qualified institutional
buyers in accordance with Rule 144A under the Act, ("Rule 144A securities").
Section 4(2) paper is restricted as to disposition under the Federal securities
laws, and generally is sold to institutional investors who agree that they are
purchasing the paper for investment and not with a view to public distribution.
Any resale by the purchaser must be in an exempt transaction. Section 4(2) paper
normally is resold to other institutional investors through or with the
assistance of the issuer or investment dealers which make a market in the
Section 4(2) paper, thus providing liquidity. Rule 144A securities generally
must be sold only to other qualified institutional buyers. If a particular
investment in Section 4(2) paper or Rule 144A securities is not determined to be
liquid, that investment will be included within the Fund's limitation on
investment in illiquid securities. The Advisor, World or the Sub-Advisor will
determine the liquidity of such investments pursuant to guidelines established
by the Boards of Directors/Trustees. It is possible that unregistered securities
purchased by

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<PAGE>

the Fund in reliance upon Rule 144A could have the effect of increasing the
level of the Fund's illiquidity to the extent that qualified institutional
buyers become, for a period, uninterested in purchasing these securities.

Interest Rate Swap Transactions. Each of the Bond Funds and the
International Bond Fund may enter into interest rate swap agreements for
purposes of attempting to obtain a particular desired return at a lower cost to
the Funds than if the Funds had invested directly in an instrument that yielded
that desired return. Interest rate swap transactions involve the exchange by a
Fund with another party of its commitments to pay or receive interest, such as
an exchange of fixed rate payments for floating rate payments. Typically, the
parties with which the Funds will enter into interest rate swap transactions
will be brokers, dealers or other financial institutions known as
"counterparties." Certain Federal income tax requirements may, however, limit
the Funds' ability to engage in certain interest rate transactions. Gains from
transaction in interest rate swaps distributed to shareholders of the Funds will
be taxable as ordinary income or, in certain circumstances, as long-term capital
gains to the shareholders.

Each of the Funds' obligations (or rights) under a swap agreement will
generally be equal only to the net amount to be paid or received under the
agreement based on the relative values of the positions held by each party to
the agreement (the "net amount"). Each of the Funds' obligations under a swap
agreement will be accrued daily (offset against any amounts owed to the Fund).
Accrued but unpaid net amounts owed to a swap counterparty will be covered by
designating cash, U.S. Government securities or other high-grade liquid
securities on the books of the Fund's custodian, to avoid any potential
leveraging of a Fund's portfolio.

The Funds will not enter into any interest rate swap transaction unless the
credit quality of the unsecured senior debt or the claims-paying ability of the
other party to the transaction is rated in one of the highest four rating
categories by at least one nationally-recognized statistical rating organization
("NRSRO") or is believed by the Advisor to be equivalent to that rating. If the
other party to a transaction defaults, the Funds will have contractual remedies
pursuant to the agreements related to the transactions.

The use of interest rate swaps is a highly specialized activity that
involves investment techniques and risks different from those associated with
ordinary portfolio securities transactions. If the Advisor is incorrect in its
forecasts of market values, interest rates and other applicable factors, the
investment performance of each of the Funds would be lower than it would have
been if interest rate swaps were not used. The swaps market has grown
substantially in recent years with a large number of banks and investment
banking firms acting both as principals and as agents utilizing standardized
swap documentation. As a result, the swaps market has become relatively liquid
in comparison with other similar instruments traded in the interbank market. The
swaps market is a relatively new market and is largely unregulated. It is
possible that developments in the swaps market, including potential government
regulation, could adversely affect the Funds' ability to terminate existing swap
agreements or to realize amounts to be received under such agreements.

Investment Company Securities. Each of the Funds (other than the Short
Term Treasury Fund) may invest in securities issued by other investment
companies. As a shareholder of another investment company, a Fund would bear its
pro rata portion of the other investment company's expenses, including advisory
fees. These expenses would be in addition to the expenses each Fund bears
directly in connection with its own operations. Each Fund currently intends to
limit its investments in securities issued by other investment companies so
that, as determined immediately after a purchase of such securities is made: (i)
not more than 5% of the value of the Fund's total assets will be invested in the
securities of any one investment company; (ii) not more than 10% of the value of
its total assets will be invested in the aggregate in securities of investment
companies as a group; and (iii) not more than 3% of the outstanding voting stock
of any one investment company will be owned by the Fund.

Lending Of Portfolio Securities. To enhance the return on its portfolio,
each of the Funds may lend securities in its portfolio (subject to a limit of
25% of each Fund's, other than the Money Market Fund's, total assets; and 33
1/3% of the Money Market Fund's total assets) to securities firms and financial
institutions, provided that each loan is secured continuously by collateral in
the form of cash, high quality money market instruments or short-term U.S.
Government securities adjusted daily to have a market value at least equal to
the current market value of the securities loaned. These loans are terminable at
any time, and the Funds will receive any interest or dividends paid on the
loaned securities. In addition, it is anticipated that a Fund may share with the
borrower some

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<PAGE>

of the income received on the collateral for the loan or the Fund will be paid a
premium for the loan. The risk in lending portfolio securities, as with other
extensions of credit, consists of possible delay in recovery of the securities
or possible loss of rights in the collateral should the borrower fail
financially. In determining whether the Funds will lend securities, the Advisor,
World (with respect to the Index 500 Fund or International Equity Fund) or the
Sub-Advisor (with respect to the Framlington Funds) will consider all relevant
facts and circumstances. The Funds will only enter into loan arrangements with
broker-dealers, banks or other institutions which the Advisor, World or the Sub-
Advisor has determined are creditworthy under guidelines established by the
Boards of Directors/Trustees.

Lower-rated Debt Securities. It is expected that each Fund (other than the
Money Market Funds, Index 500 Fund and Growth & Income Fund) will invest not
more than 5% of its total assets in securities that are rated below investment
grade by Standard & Poor's Rating Service, a division of McGraw-Hill Companies,
Inc. ("S&P"), or Moody's Investors Service, Inc. ("Moody's"), or in comparable
unrated securities. The Growth & Income Fund may invest up to 20% of the value
of its total assets in such securities. The Money Market Funds and the Index 500
Fund may not invest in such securities. Such securities are also known as junk
bonds. The yields on lower-rated debt and comparable unrated securities
generally are higher than the yields available on higher-rated securities.
However, investments in lower-rated debt and comparable unrated securities
generally involve greater volatility of price and risk of loss of income and
principal, including the possibility of default by or bankruptcy of the issuers
of such securities. Lower-rated debt and comparable unrated securities (a) will
likely have some quality and protective characteristics that, in the judgment of
the rating organization, are outweighed by large uncertainties or major risk
exposures to adverse conditions and (b) are predominantly speculative with
respect to the issuer's capacity to pay interest and repay principal in
accordance with the terms of the obligation. Accordingly, it is possible that
these types of factors could, in certain instances, reduce the value of
securities held in each Fund's portfolio, with a commensurate effect on the
value of each of the Fund's shares. Therefore, an investment in the Funds should
not be considered as a complete investment program and may not be appropriate
for all investors.

While the market values of lower-rated debt and comparable unrated
securities tend to react more to fluctuations in interest rate levels than the
market values of higher-rated securities, the market values of certain lower
rated debt and comparable unrated securities also tend to be more sensitive to
individual corporate developments and changes in economic conditions than
higher-rated securities. In addition, lower-rated debt securities and comparable
unrated securities generally present a higher degree of credit risk. Issuers of
lower-rated debt and comparable unrated securities often are highly leveraged
and may not have more traditional methods of financing available to them so that
their ability to service their debt obligations during an economic downturn or
during sustained periods of rising interest rates may be impaired. The risk of
loss due to default by such issuers is significantly greater because lower-rated
debt and comparable unrated securities generally are unsecured and frequently
are subordinated to the prior payment of senior indebtedness. The Funds may
incur additional expenses to the extent that they are required to seek recovery
upon a default in the payment of principal or interest on their portfolio
holdings. The existence of limited markets for lower-rated debt and comparable
unrated securities may diminish each of the Fund's ability to (a) obtain
accurate market quotations for purposes of valuing such securities and
calculating its net asset value and (b) sell the securities at fair value either
to meet redemption requests or to respond to changes in the economy or in
financial markets.

Lower-rated debt securities and comparable unrated securities may have call
or buy-back features that permit their issuers to call or repurchase the
securities from their holders. If an issuer exercises these rights during
periods of declining interest rates, the Funds may have to replace the security
with a lower yielding security, thus resulting in a decreased return to the
Funds. A description of applicable credit ratings is set forth in Appendix A of
this SAI.

Money Market Instruments. Each of the Funds (except the Short Term
Treasury Fund) may invest from time to time in "money market instruments," a
term that includes, among other things, bank obligations, commercial paper,
variable amount master demand notes and corporate bonds with remaining
maturities of 397 days or less.

Bank obligations include bankers' acceptances, negotiable certificates of
deposit and non-negotiable time deposits, including U.S. dollar-denominated
instruments issued or supported by the credit of U.S. or foreign banks or
savings institutions. Although the Funds will invest in obligations of foreign
banks or foreign branches of U.S.

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<PAGE>

banks only where the Advisor, World or the Sub-Advisor deems the instrument to
present minimal credit risks, such investments may nevertheless entail risks
that are different from those of investments in domestic obligations of U.S.
banks due to differences in political, regulatory and economic systems and
conditions. All investments in bank obligations are limited to the obligations
of financial institutions having more than $1 billion in total assets at the
time of purchase.

Investments by a Fund in commercial paper will consist of issues rated at
the time of purchase A-1 and/or P-1 by S&P or Moody's. In addition, the Funds
may acquire unrated commercial paper and corporate bonds that are determined by
the Advisor, World (with respect to the Index 500 Fund or International Equity
Fund) or the Sub-Advisor (with respect to the Framlington Funds) at the time of
purchase to be of comparable quality to rated instruments that may be acquired
by such Fund as previously described.

The Funds may also purchase variable amount master demand notes which are
unsecured instruments that permit the indebtedness thereunder to vary and
provide for periodic adjustments in the interest rate. Although the notes are
not normally traded and there may be no secondary market in the notes, a Fund
may demand payment of the principal of the instrument at any time. The notes
are not typically rated by credit rating agencies, but issuers of variable
amount master demand notes must satisfy the same criteria as set forth above for
issuers of commercial paper. If an issuer of a variable amount master demand
note defaulted on its payment obligation, a Fund might be unable to dispose of
the note because of the absence of a secondary market and might, for this or
other reasons, suffer a loss to the extent of the default. The Funds invest in
variable amount master notes only when the Advisor, World or the Sub-Advisor
deems the investment to involve minimal credit risk.

Mortgage-related Securities. There are a number of important differences
among the agencies and instrumentalities of the U.S. Government that issue
mortgage-related securities and among the securities that they issue. Mortgage-
related securities guaranteed by the Government National Mortgage Association
("GNMA") include GNMA Mortgage Pass-Through Certificates (also known as "Ginnie
Maes") which are guaranteed as to the timely payment of principal and interest
by GNMA and such guarantee is backed by the full faith and credit of the United
States. GNMA is a wholly-owned U.S. Government corporation within the Department
of Housing and Urban Development. GNMA certificates also are supported by the
authority of GNMA to borrow funds from the U.S. Treasury to make payments under
its guarantee. Mortgage-related securities issued by the Federal National
Mortgage Association ("FNMA") include FNMA Guaranteed Mortgage Pass-Through
Certificates (also known as "Fannie Maes") which are solely the obligations of
the FNMA and are not backed by or entitled to the full faith and credit of the
United States, but are supported by the right of the issuer to borrow from the
U.S. Treasury. FNMA is a government-sponsored organization owned entirely by
private stockholders. Fannie Maes are guaranteed as to timely payment of the
principal and interest by FNMA. Mortgage-related securities issued by the
Federal Home Loan Mortgage Corporation ("FHLMC") include FHLMC Mortgage
Participation Certificates (also known as "Freddie Macs" or "PCs"). FHLMC is a
corporate instrumentality of the United States, created pursuant to an Act of
Congress, which is owned entirely by Federal Home Loan Banks. Freddie Macs are
not guaranteed by the United States or by any Federal Home Loan Banks and do not
constitute a debt or obligation of the United States or of any Federal Home Loan
Bank. Freddie Macs entitle the holder to timely payment of interest, which is
guaranteed by the FHLMC. FHLMC guarantees either ultimate collection or timely
payment of all principal payments on the underlying mortgage loans. When FHLMC
does not guarantee timely payment of principal, FHLMC may remit the amount due
on account of its guarantee of ultimate payment of principal at any time after
default on an underlying mortgage, but in no event later than one year after it
becomes payable.

Municipal Obligations. Opinions relating to the validity of municipal
obligations and to the exemption of interest thereon from regular Federal income
tax are rendered by bond counsel or counsel to the respective issuers at the
time of issuance. Neither the Company, the Trust nor the Advisor will review
the proceedings relating to the issuance of municipal obligations or the bases
for such opinions.

An issuer's obligations under its municipal obligations are subject to the
provisions of bankruptcy, insolvency and other laws affecting the rights and
remedies of creditors, such as the Federal Bankruptcy Code, and laws, if any,
which may be enacted by Federal or state legislatures extending the time for
payment of principal or interest, or both, or imposing other constraints upon
enforcement of such obligations or upon the ability of

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<PAGE>

municipalities to levy taxes. The power or ability of an issuer to meet its
obligations for the payment of interest on and principal of its municipal
obligations may be materially adversely affected by litigation or other
conditions.

From time to time proposals have been introduced before Congress for the
purpose of restricting or eliminating the Federal income tax exemption for
interest on municipal obligations. For example, under the Tax Reform Act of 1986
interest on certain private activity bonds must be included in an investor's
Federal alternative minimum taxable income, and corporate investors must include
all tax-exempt interest in their Federal alternative minimum taxable income. The
Trust cannot predict what legislation, if any, may be proposed in Congress in
the future as regards the Federal income tax status of interest on municipal
obligations in general, or which proposals, if any, might be enacted. Such
proposals, if enacted, might materially adversely affect the availability of
municipal obligations for investment by the Tax-Free Bond Funds and the Tax-Free
Money Market Fund and the liquidity and value of such Funds. In such an event
the Board of Trustees would reevaluate the Fund's investment objective and
policies and consider changes in its structure or possible dissolution.

The Cash Investment Fund and the Money Market Fund each may, when deemed
appropriate by the Advisor in light of the Fund's investment objective, invest
in high quality municipal obligations issued by state and local governmental
issuers, the interest on which may be taxable or tax-exempt for Federal income
tax purposes, provided that such obligations carry yields that are competitive
with those of other types of money market instruments of comparable quality.
Neither the Cash Investment Fund nor the Money Market Fund expects to invest
more than 5% of its net assets in such municipal obligations during the current
fiscal year.

Non-Domestic Bank Obligations. Non-domestic bank obligations include
Eurodollar Certificates of Deposit ("ECDs"), which are U.S. dollar-denominated
certificates of deposit issued by offices of foreign and domestic banks located
outside the United States; Eurodollar Time Deposits ("ETDs"), which are U.S.
dollar-denominated deposits in a foreign branch of a U.S. bank or a foreign
bank; Canadian Time Deposits ("CTDs"), which are essentially the same as ETDs
except they are issued by Canadian offices of major Canadian banks; Schedule Bs,
which are obligations issued by Canadian branches of foreign or domestic banks;
Yankee Certificates of Deposit ("Yankee CDs"), which are U.S. dollar-denominated
certificates of deposit issued by a U.S. branch of a foreign bank and held in
the United States; and Yankee Bankers' Acceptances ("Yankee BAs"), which are
U.S. dollar denominated bankers' acceptances issued by a U.S. branch of a
foreign bank and held in the United States.

Options. Each of the Equity Funds, Balanced Fund, Bond Funds,
International Bond Fund and Tax-Free Bond Funds (other than Tax-Free Short-
Intermediate Bond Fund) may write covered call options, buy put options, buy
call options and write secured put options. For a detailed description on
options, see Appendix B to this SAI.

Real Estate Securities. The Real Estate Fund may invest without limit in
shares of real estate investment trusts ("REITs"). The Equity Funds and the
Balanced Fund may also invest in REITs. REITs pool investors' funds for
investment primarily in income producing real estate or real estate loans or
interests. A REIT is not taxed on income distributed to shareholders if it
complies with several requirements relating to its organization, ownership,
assets, and income and a requirement that it distribute to its shareholders at
least 95% of it taxable income (other than net capital gains) for each taxable
year. REITs can generally be classified as Equity REITs, Mortgage REITs and
Hybrid REITs. Equity REITs, which invest the majority of their assets directly
in real property, derive their income primarily from rents. Equity REITs can
also realize capital gains by selling properties that have appreciated in value.
Mortgage REITs, which invest the majority of their assets in real estate
mortgages, derive their income primarily from interest payments. Hybrid REITs
combine the characteristics of both Equity REITs and Mortgage REITs. The Funds
will not invest in real estate directly, but only in securities issued by real
estate companies. However, the Funds may be subject to risks similar to those
associated with the direct ownership of real estate (in addition to securities
markets risks) because of its policy of concentration in the securities of
companies in the real estate industry. These include declines in the value of
real estate, risks related to general and local economic conditions, dependency
on management skill, heavy cash flow dependency, possible lack of availability
of mortgage funds, overbuilding, extended vacancies of properties, increased
competition, increases in property taxes and operating expenses, changes in
zoning laws, losses due to costs resulting from the clean-up of environmental
problems, liability to third parties for damages resulting from environmental
problems, casualty or condemnation

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<PAGE>

losses, limitations on rents, changes in neighborhood values, the appeal of
properties to tenants and changes in interest rates.

In addition to these risks, Equity REITs may be affected by changes in the
value of the underlying property owned by the trusts, while Mortgage REITs may
be affected by the quality of any credit extended. Further, Equity and Mortgage
REITs are dependent upon management skills and generally may not be diversified.
Equity and Mortgage REITs are also subject to heavy cash flow dependency,
defaults by borrowers and self-liquidation. In addition, Equity and Mortgage
REITs could possibly fail to qualify for the beneficial tax treatment available
to REITs under the Internal Revenue Code of 1986, as amended (the "Internal
Revenue Code"), or to maintain their exemptions from registration under the 1940
Act. The above factors may also adversely affect a borrower's or a lessee's
ability to meet its obligations to the REIT. In the event of a default by a
borrower or lessee, the REIT may experience delays in enforcing its rights as a
mortgagee or lessor and may incur substantial costs associated with protecting
investments.

Repurchase Agreements. Each of the Funds may agree to purchase securities
from financial institutions such as member banks of the Federal Reserve System,
any foreign bank or any domestic or foreign broker/dealer that is recognized as
a reporting government securities dealer, subject to the seller's agreement to
repurchase the securities at an agreed-upon time and price ("repurchase
agreements"). The Short Term Treasury Fund will only invest in repurchase
agreements fully collateralized by U.S. Treasury securities. The Advisor, World
or the Sub-Advisor will review and continuously monitor the creditworthiness of
the seller under a repurchase agreement, and will require the seller to maintain
collateral in an amount that is greater than the repurchase price. Default by,
or bankruptcy of, the seller would, however, expose a Fund to possible loss
because of adverse market action or delays in connection with the disposition of
underlying obligations except with respect to repurchase agreements secured by
U.S. Government securities. With respect to the Money Market Funds, the
securities held subject to a repurchase agreement may have stated maturities
exceeding thirteen months, provided the repurchase agreement itself matures in
397 days or less.

The repurchase price under repurchase agreements generally equals the price
paid by a Fund plus interest negotiated on the basis of current short-term rates
(which may be more or less than the rate on the securities underlying the
repurchase agreement).

Securities subject to repurchase agreements will be held, as applicable, by
the Trust's, Framlington's or the Company's custodian in the Federal
Reserve/Treasury book-entry system or by another authorized securities
depositary. Repurchase agreements are considered to be loans by a Fund under the
1940 Act.

Reverse Repurchase Agreements. Each Fund may borrow funds for temporary or
emergency purposes by selling portfolio securities to financial institutions
such as banks and broker/dealers and agreeing to repurchase them at a mutually
specified date and price ("reverse repurchase agreements"). Reverse repurchase
agreements involve the risk that the market value of the securities sold by a
Fund may decline below the repurchase price. A Fund will pay interest on amounts
obtained pursuant to a reverse repurchase agreement. While reverse repurchase
agreements are outstanding, a Fund will maintain cash, U.S. Government
securities or other liquid securities designated on the books of the Fund or the
Fund's custodian in an amount at least equal to the market value of the
securities, plus accrued interest, subject to the agreement.

Rights and Warrants. The Equity Funds and the Balanced Fund may purchase
warrants, which are privileges issued by corporations enabling the owners to
subscribe to and purchase a specified number of shares of the corporation at a
specified price during a specified period of time. Subscription rights normally
have a short life span to expiration. The purchase of warrants involves the risk
that a Fund could lose the purchase value of a warrant if the right to subscribe
to additional shares is not exercised prior to the warrant's expiration. Also,
the purchase of warrants involves the risk that the effective price paid for the
warrant added to the subscription price of the related security may exceed the
value of the subscribed security's market price such as when there is no
movement in the level of the underlying security.

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<PAGE>

Short Sales. The Global Financial Services Fund may make short sales of
securities. A short sale is a transaction in which the Fund sells a security it
does not own in anticipation that the market price of that security will
decline. When the Fund makes a short sale, it must borrow the security sold
short and deliver it to the broker-dealer through which it made the short sale
as collateral for its obligation to deliver the security upon conclusion of the
sale. The Fund may also sell securities that it owns or has the right to acquire
at no additional cost but does not intend to deliver to the buyer, a practice
known as selling short "against-the-box." The Fund may have to pay a fee to
borrow particular securities and is often obligated to pay over any payments
received on such borrowed securities. The Fund's obligation to replace the
borrowed security will be secured by collateral deposited with the broker-
dealers, usually cash, U.S. Government securities or other highly liquid
securities similar to those borrowed. The Fund will also be required to deposit
similar collateral with its custodian to the extent necessary so that the value
of both collateral deposits in the aggregate is at all times equal to as least
100% of the current market value of the security sold short. Depending on
arrangements made with the broker-dealer from which it borrowed the security
regarding payment over any received by the Fund on such security, the Fund may
not received any payments (including interest) on its collateral deposited with
such broker-dealer. The Fund will incur transaction costs, including interest
expenses, in connection with opening, maintaining, and closing short sales.

If the price of the security sold short increases between the time of the
short sale and the time the Fund replaces the borrowed security, the Fund will
incur a loss; conversely, if the price declines, the Fund will realize a capital
gain. Any gain is limited to the price at which it sold the security short; its
potential loss is theoretically unlimited.

Stand-by Commitments. The Balanced Fund, Cash Investment Fund, Money
Market Fund, the Tax-Free Bond Funds and Tax-Free Money Market Fund may each
enter into stand-by commitments with respect to municipal obligations held by
it. Under a stand-by commitment, a dealer agrees to purchase at the Fund's
option a specified municipal obligation at its amortized cost value to the Fund
plus accrued interest, if any. Stand-by commitments may be exercisable by a Fund
at any time before the maturity of the underlying municipal obligations and may
be sold, transferred or assigned only with the instruments involved.

The Company and the Trust expects that stand-by commitments will generally
be available without the payment of any direct or indirect consideration.
However, if necessary or advisable, a Fund may pay for a stand-by commitment
either separately in cash or by paying a higher price for municipal obligations
which are acquired subject to the commitment (thus reducing the yield to
maturity otherwise available for the same securities). The total amount paid in
either manner for outstanding stand-by commitments held by a Fund will not
exceed 1/2 of 1% of the value of such Fund's total assets calculated immediately
after each stand-by commitment is acquired.

The Funds intend to enter into stand-by commitments only with dealers,
banks and broker/dealers which, in the Advisor's opinion, present minimal credit
risks. The Tax-Free Bond Funds and the Tax-Free Money Market Fund will acquire
stand-by commitments solely to facilitate portfolio liquidity and do not intend
to exercise their rights thereunder for trading purposes. The acquisition of a
stand-by commitment will not affect the valuation of the underlying municipal
obligation. The actual stand-by commitment will be valued at zero in determining
net asset value. Accordingly, where a Fund pays directly or indirectly for a
stand-by commitment, its cost will be reflected as an unrealized loss for the
period during which the commitment is held by such Fund and will be reflected in
realized gain or loss when the commitment is exercised or expires.

Stock Index Futures, Options on Stock and Bond Indices and Options on Stock
and Bond Index Futures Contracts. The Equity Funds, the Balanced Fund, the Bond
Funds and the Tax-Free Bond Funds (other than the Tax-Free Short-Intermediate
Bond Fund) may purchase and sell stock index futures, options on stock and bond
indices and options on stock and bond index futures contracts as a hedge against
movements in the equity and bond markets. The Tax-Free Short-Intermediate Bond
Fund may purchase and sell bond index futures contracts. The International Bond
Fund may purchase and sell options on bond index futures contracts as a hedge
against movements in the bond markets.

A stock index futures contract is an agreement in which one party agrees to
deliver to the other an amount of cash equal to a specific dollar amount times
the difference between the value of a specific stock index at the close

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<PAGE>

of the last trading day of the contract and the price at which the agreement is
made. No physical delivery of securities is made.

Options on stock and bond indices are similar to options on specific
securities, described above, except that, rather than the right to take or make
delivery of the specific security at a specific price, an option on a stock or
bond index gives the holder the right to receive, upon exercise of the option,
an amount of cash if the closing level of that stock or bond index is greater
than, in the case of a call option, or less than, in the case of a put option,
the exercise price of the option. This amount of cash is equal to such
difference between the closing price of the index and the exercise price of the
option expressed in dollars times a specified multiple. The writer of the option
is obligated, in return for the premium received, to make delivery of this
amount. Unlike options on specific securities, all settlements of options on
stock or bond indices are in cash, and gain or loss depends on general movements
in the stocks included in the index rather than price movements in particular
stocks.

If the Advisor, World (with respect to the Index 500 Fund and the
International Equity Fund) or the Sub-Advisor (with respect to the Framlington
Funds) expects general stock or bond market prices to rise, it might purchase a
stock index futures contract, or a call option on that index, as a hedge against
an increase in prices of particular securities it ultimately wants to buy. If in
fact the index does rise, the price of the particular securities intended to be
purchased may also increase, but that increase would be offset in part by the
increase in the value of the futures contract or index option resulting from the
increase in the index. If, on the other hand, the Advisor, World or the Sub-
Advisor, as the case may be, expects general stock or bond market prices to
decline, it might sell a futures contract, or purchase a put option, on the
index. If that index does in fact decline, the value of some or all of the
securities in the Funds' portfolio may also be expected to decline, but that
decrease would be offset in part by the increase in the value of the Fund's
position in such futures contract or put option.

The Equity Funds, the Balanced Fund, the Bond Funds and the Tax-Free Bond
Funds (other than Tax-Free Short-Intermediate Bond Fund) may purchase and write
call and put options on stock index futures contracts and each such Fund and the
International Bond Fund may purchase and write call and put options on bond
index futures contracts. Each such Fund may use such options on futures
contracts in connection with its hedging strategies in lieu of purchasing and
selling the underlying futures or purchasing and writing options directly on the
underlying securities or indices. For example, such Funds may purchase put
options or write call options on stock and bond index futures (only bond index
futures in the case of the International Bond Fund), rather than selling futures
contracts, in anticipation of a decline in general stock or bond market prices
or purchase call options or write put options on stock or bond index futures,
rather than purchasing such futures, to hedge against possible increases in the
price of securities which such Funds intend to purchase.

In connection with transactions in stock or bond index futures, stock or
bond index options and options on stock or bond index futures, the Funds will be
required to deposit as "initial margin" an amount of cash or short-term U.S.
Government securities equal to between 5% to 8% of the contract amount.
Thereafter, subsequent payments (referred to as "variation margin") are made to
and from the broker to reflect changes in the value of the option or futures
contract. No Fund may at any time commit more than 5% of its total assets to
initial margin deposits on futures contracts, index options and options on
futures contracts.

Stripped Securities. Certain Funds may acquire U.S. Government obligations
and their unmatured interest coupons that have been separated ("stripped") by
their holder, typically a custodian bank or investment brokerage firm. Having
separated the interest coupons from the underlying principal of the U.S.
Government obligations, the holder will resell the stripped securities in
custodial receipt programs with a number of different names, including "Treasury
Income Growth Receipts" ("TIGRs") and "Certificate of Accrual on Treasury
Securities" ("CATS"). The stripped coupons are sold separately from the
underlying principal, which is usually sold at a deep discount because the buyer
receives only the right to receive a future fixed principal payment on the
security and does not receive any rights to periodic interest (cash) payments.
The underlying U.S. Treasury bonds and notes themselves are held in book-entry
form at the Federal Reserve Bank or, in the case of bearer securities (i.e.,
unregistered securities which are ostensibly owned by the bearer or holder), in
trust on behalf of the owners. Counsel to the underwriters of these certificates
or other evidences of ownership of U.S. Treasury securities have stated that, in
their opinion, purchasers of the stripped securities most likely will be deemed
the beneficial holders of

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<PAGE>

the underlying U.S. Government obligations for federal tax and securities
purposes. The Company, the Trust and Framlington are not aware of any binding
legislative, judicial or administrative authority on this issue.

Only instruments which are stripped by the issuing agency will be
considered U.S. Government obligations. Securities such as CATS and TIGRs which
are stripped by their holder do not qualify as U.S. Government obligations.

The U.S. Treasury Department has facilitated transfers of ownership of zero
coupon securities by accounting separately for the beneficial ownership of
particular interest coupon and principal payments on U.S. Treasury securities
through the Federal Reserve book-entry record-keeping system. The Federal
Reserve program as established by the U.S. Treasury Department is known as
"STRIPS" or "Separate Trading of Registered Interest and Principal of
Securities." Under the STRIPS program, a Fund is able to have its beneficial
ownership of zero coupon securities recorded directly in the book-entry record-
keeping system in lieu of having to hold certificates or other evidences of
ownership of the underlying U.S. Treasury securities.

In addition, the Bond Fund, Intermediate Bond Fund, International Bond Fund
and U.S. Income Fund may invest in stripped mortgage-backed securities ("SMBS"),
which represent beneficial ownership interests in the principal distributions
and/or the interest distributions on mortgage assets. SMBS are usually
structured with two classes that receive different proportions of the interest
and principal distributions on a pool of mortgage assets. One type of SMBS will
have one class receiving some of the interest and most of the principal from the
mortgage assets, while the other class will receive most of the interest and the
remainder of the principal. In the most common case, one class of SMBS will
receive all of the interest (the interest-only or "IO" class), while the other
class will receive all of the principal (the principal-only or "PO" class). SMBS
may be issued by FNMA or FHLMC.

The original principal amount, if any, of each SMBS class represents the
amount payable to the holder thereof over the life of such SMBS class from
principal distributions of the underlying mortgage assets, which will be zero in
the case of an IO class. Interest distributions allocable to a class of SMBS, if
any, consist of interest at a specified rate on its principal amount, if any, or
its notional principal amount in the case of an IO class. The notional principal
amount is used solely for purposes of the determination of interest
distributions and certain other rights of holders of such IO class and does not
represent an interest in principal distributions of the mortgage assets.

Yields on SMBS will be extremely sensitive to the prepayment experience on
the underlying mortgage loans, and there are other associated risks. For IO
classes of SMBS and SMBS that were purchased at prices exceeding their principal
amounts there is a risk that a Fund may not fully recover its initial
investment.

The determination of whether a particular government-issued IO or PO backed
by fixed-rate mortgages is liquid may be made under guidelines and standards
established by the Boards of Directors/Trustees. Such securities may be deemed
liquid if they can be disposed of promptly in the ordinary course of business at
a value reasonably close to that used in the calculation of a Fund's net asset
value per share.

Supranational Bank Obligations. Supranational banks are international
banking institutions designed or supported by national governments to promote
economic reconstruction, development or trade between nations (e.g., The World
Bank). Obligations of supranational banks may be supported by appropriated but
unpaid commitments of their member countries and there is no assurance these
commitments will be undertaken or met in the future.

U.S. Government Obligations. The Funds may purchase obligations issued or
guaranteed by the U.S. Government and, except in the case of the U.S. Treasury
Money Market Fund and the Short Term Treasury Fund, U.S. Government agencies and
instrumentalities. The U.S. Treasury Money Market Fund and the Short Term
Treasury Fund will purchase obligations issued by the U.S. Treasury. Obligations
of certain agencies and instrumentalities of the U.S. Government, such as those
of GNMA, are supported by the full faith and credit of the U.S. Treasury.
Others, such as those of the Export-Import Bank of the United States, are
supported by the right of the issuer to borrow from the U.S. Treasury; and still
others, such as those of the Student Loan Marketing

15
<PAGE>

Association, are supported only by the credit of the agency or instrumentality
issuing the obligation. No assurance can be given that the U.S. Government would
provide financial support to U.S. Government-sponsored instrumentalities if it
is not obligated to do so by law. Examples of the types of U.S. Government
obligations that may be acquired by the Funds include U.S. Treasury Bills, U.S.
Treasury Notes and U.S. Treasury Bonds and the obligations of Federal Home Loan
Banks, Federal Farm Credit Banks, Federal Land Banks, the Federal Housing
Administration, Farmers Home Administration, Export-Import Bank of the United
States, Small Business Administration, FNMA, GNMA, General Services
Administration, Student Loan Marketing Association, Central Bank for
Cooperatives, FHLMC, Federal Intermediate Credit Banks and Maritime
Administration.

Variable and Floating Rate Instruments. Debt instruments may be structured
to have variable or floating interest rates. Variable and floating rate
obligations purchased by a Fund may have stated maturities in excess of a Fund's
maturity limitation if the Fund can demand payment of the principal of the
instrument at least once during such period on not more than thirty days' notice
(this demand feature is not required if the instrument is guaranteed by the U.S.
Government or an agency thereof). These instruments may include variable amount
master demand notes that permit the indebtedness to vary in addition to
providing for periodic adjustments in the interest rates. The Advisor or the
Sub-Advisor, as the case may be, will consider the earning power, cash flows and
other liquidity ratios of the issuers and guarantors of such instruments and, if
the instrument is subject to a demand feature, will continuously monitor their
financial ability to meet payment on demand. Where necessary to ensure that a
variable or floating rate instrument is equivalent to the quality standards
applicable to a Fund, the issuer's obligation to pay the principal of the
instrument will be backed by an unconditional bank letter or line of credit,
guarantee or commitment to lend. The Money Market Funds will invest in variable
and floating rate instruments only when the Advisor deems the investment to
involve minimal credit risk.

In determining average weighted portfolio maturity of the Funds, an
instrument will usually be deemed to have a maturity equal to the longer of the
period remaining until the next interest rate adjustment or the time the Fund
involved can recover payment of principal as specified in the instrument.
Variable rate U.S. Government obligations held by the Funds, however, will be
deemed to have maturities equal to the period remaining until the next interest
rate adjustment.

The absence of an active secondary market for certain variable and floating
rate notes could make it difficult to dispose of the instruments, and a Fund
could suffer a loss if the issuer defaulted or during periods that a Fund is not
entitled to exercise its demand rights.

Variable and floating rate instruments held by a Fund will be subject to
the Fund's limitation on illiquid investments when the Fund may not demand
payment of the principal amount within seven days absent a reliable trading
market.

Guaranteed Investment Contracts. The Bond Funds, International Bond Fund,
Cash Investment Fund and Money Market Fund may make limited investments in
guaranteed investment contracts ("GICs") issued by U.S. insurance companies.
Pursuant to such contracts, a Fund makes cash contributions to a deposit fund of
the insurance company's general account. The insurance company then credits to
the Fund on a monthly basis interest which is based on an index (in most cases
this index is expected to be the Salomon Brothers CD Index), but is guaranteed
not to be less than a certain minimum rate. A GIC is normally a general
obligation of the issuing insurance company and not funded by a separate
account. The purchase price paid for a GIC becomes part of the general assets of
the insurance company, and the contract is paid from the company's general
assets. A Fund will only purchase GICs from insurance companies which, at the
time of purchase, have assets of $1 billion or more and meet quality and credit
standards established by the Advisor pursuant to guidelines approved by the
Boards of Directors/Trustees. Generally, GICs are not assignable or transferable
without the permission of the issuing insurance companies, and an active
secondary market in GICs does not currently exist. Therefore, GICs will normally
be considered illiquid investments, and will be acquired subject to the Fund's
limitation on illiquid investments.

When-Issued Purchases and Forward Commitments (Delayed-Delivery
Transactions). When-issued purchases and forward commitments (known as delayed-
delivery transactions) are commitments by a Fund to

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<PAGE>

purchase or sell particular securities with payment and delivery to occur at a
future date (perhaps one or two months later). These transactions permit the
Fund to lock-in a price or yield on a security, regardless of future changes in
interest rates.

When a Fund agrees to purchase securities on a when-issued or forward
commitment basis, the Fund will designate cash or liquid portfolio securities
equal to the amount of the commitment. Normally, the Fund will designate
portfolio securities to satisfy a purchase commitment, and in such a case the
Fund may be required subsequently to designate additional assets in order to
ensure that the value of the account remains equal to the amount of the Fund's
commitments. It may be expected that the market value of the Fund's net assets
will fluctuate to a greater degree when it designates portfolio securities to
cover such purchase commitments than when it designates cash. Because a Fund's
liquidity and ability to manage its portfolio might be affected when it
designates cash or portfolio securities to cover such purchase commitments, the
Advisor or the Sub-Advisor expects that its commitments to purchase when-issued
securities and forward commitments will not exceed 25% of the value of a Fund's
total assets absent unusual market conditions.

A Fund will purchase securities on a when-issued or forward commitment
basis only with the intention of completing the transaction and actually
purchasing the securities. If deemed advisable as a matter of investment
strategy, however, a Fund may dispose of or renegotiate a commitment after it is
entered into, and may sell securities it has committed to purchase before those
securities are delivered to the Fund on the settlement date. In these cases the
Fund may realize a taxable capital gain or loss.

When a Fund engages in when-issued and forward commitment transactions, it
relies on the other party to consummate the trade. Failure of such party to do
so may result in the Fund's incurring a loss or missing an opportunity to obtain
a price considered to be advantageous.

The market value of the securities underlying a when-issued purchase or a
forward commitment to purchase securities, and any subsequent fluctuations in
their market value, are taken into account when determining the market value of
a Fund starting on the day the Fund agrees to purchase the securities. The Fund
does not earn interest on the securities it has committed to purchase until they
are paid for and delivered on the settlement date.

Yields and Ratings. The yields on certain obligations, including the money
market instruments in which each Fund may invest (such as commercial paper and
bank obligations), are dependent on a variety of factors, including general
money market conditions, conditions in the particular market for the obligation,
the financial condition of the issuer, the size of the offering, the maturity of
the obligation and the ratings of the issue. The ratings of S&P, Moody's, Duff &
Phelps Credit Rating Co., Thomson Bank Watch, Inc., Fitch IBCA, Inc. and other
NRSROs represent their respective opinions as to the quality of the obligations
they undertake to rate. Ratings, however, are general and are not absolute
standards of quality. Consequently, obligations with the same rating, maturity
and interest rate may have different market prices.

With respect to each of the Money Market Funds, securities (other than U.S.
Government securities) must be rated (generally, by at least two NRSROs) within
the two highest rating categories assigned to short-term debt securities. In
addition, each of Cash Investment Fund and Money Market Fund will not invest
more than 5% of its total assets in securities rated in the second highest
rating category by such NRSROs and will not invest more than 1% of its total
assets in such securities of any one issuer. Each of Cash Investment Fund, Money
Market Fund and Tax-Free Money Market Fund intends to limit investments in the
securities of any single issuer (other than securities issued or guaranteed by
the U.S. Government, its agencies or instrumentalities) to not more than 5% of
the Fund's total assets at the time of purchase, provided that the Fund may
invest up to 25% of its total assets in the securities of any one issuer rated
in the highest rating category by an NRSRO for a period of up to three business
days. Unrated and certain single rated securities (other than U.S. Government
securities) may be purchased by the Money Market Funds, but are subject to a
determination by the Advisor, in accordance with procedures established by the
Boards of Directors/Trustees, that the unrated and single rated securities are
of comparable quality to the appropriate rated securities.

17
<PAGE>

Other. Subsequent to its purchase by a Fund, a rated security may cease to
be rated or its rating may be reduced below the minimum rating required for
purchase by the Fund. The Boards of Directors/Trustees or the Advisor or the
Sub-Advisor, pursuant to guidelines established by the Boards, will consider
such an event in determining whether the Fund involved should continue to hold
the security in accordance with the interests of the Fund and applicable
regulations of the SEC.

RISK FACTORS AND SPECIAL CONSIDERATIONS -- INDEX 500 FUND

Traditional methods of fund investment management typically involve
relatively frequent changes in a portfolio of securities on the basis of
economic, financial and market analysis. Index funds such as the Index 500 Fund
are not managed in this manner. Instead, with the aid of a computer program,
World purchases and sells securities for the Fund in an attempt to produce
investment results that substantially duplicate the performance of the common
stocks included in the S&P 500 Composite Stock Price Index ("S&P 500"), taking
into account redemptions, sales of additional Fund shares, and other adjustments
as described below.

The Fund does not expect to hold at any particular time all of the stocks
included in the S&P 500. World believes, however, that through the application
of capitalization weighing and sector balancing techniques it will be able to
construct and maintain the Fund's investment portfolio so that it reasonably
tracks the performance of the S&P 500. World will compare the industry sector
diversification of the stocks the Fund would acquire solely on the basis of
their weighted capitalizations with the industry sector diversification of all
issuers included in the S&P 500. This comparison is made because World believes
that, unless the Fund holds all stocks included in the S&P 500, the selection of
stocks for purchase by the Fund solely on the basis of their weighted market
capitalizations would tend to place heavier concentration in certain industry
sectors that are dominated by the larger corporations, such as communications,
automobile, oil and energy. As a result, events disproportionately affecting
such industries could affect the performance of the Fund differently than the
performance of the S&P 500. Conversely, if smaller companies were not purchased
by the Fund, the representation of industries included in the S&P 500 that are
not dominated by the most heavily market-capitalized companies would be reduced
or eliminated.

For these reasons, World will identify the sectors which are (or, except
for sector balancing, would be) most underrepresented in the Fund's portfolio
and will purchase balancing securities in these sectors until the portfolio's
sector weightings closely match those of the S&P 500. This process continues
until the portfolio is fully invested (except for cash holdings).

Redemptions of a substantial number of shares of the Fund could reduce the
number of issuers represented in the Fund's investment portfolio, which could,
in turn, adversely affect the accuracy with which the Fund tracks the
performance of the S&P 500.

If an issuer drops in ranking, or is eliminated entirely from the S&P 500,
World may be required to sell some or all of the common stock of such issuer
then held by the Fund. Such sales of portfolio securities may be made at times
when, if World were not required to effect purchases and sales of portfolio
securities in accordance with the S&P 500, such securities might not be sold.
These sales may result in lower prices for the securities than may have been
realized or in losses that may not have been incurred if World were not required
to effect the purchases and sales. The failure of an issuer to declare or pay
dividends, the institution against an issuer of potentially materially adverse
legal proceedings, the existence or threat of defaults materially and adversely
affecting an issuer's future declaration and payment of dividends, or the
existence of other materially adverse credit factors will not necessarily be the
basis for the disposition of portfolio securities, unless such event causes the
issuer to be eliminated entirely from the S&P 500. However, although World does
not intend to screen securities for investment by the Fund by traditional
methods of financial and market analysis, World will monitor the Fund's
investment with a view towards removing stocks of companies which exhibit
extreme financial distress or which may impair for any reason the Fund's ability
to achieve its investment objective.

The Fund will invest primarily in the common stocks that constitute the S&P
500 in accordance with their relative capitalization and sector weightings as
described above. It is possible, however, that the Fund will from time to time
receive, as part of a "spin-off" or other corporate reorganization of an issuer
included in the S&P 500,

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<PAGE>

securities that are themselves outside the S&P 500. Such securities will be
disposed of by the Fund in due course consistent with the Fund's investment
objective.

In addition, the Fund may invest in Standard & Poor's Depository Receipts
("SPDRs"). SPDRs are securities that represent ownership in the SPDR Trust, a
long-term unit investment trust which is intended to provide investment results
that generally correspond to the price and yield performance of the S&P 500.
SPDR holders are paid a "Dividend Equivalent Amount" that corresponds to the
amount of cash dividends accruing to the securities in the SPDR Trust, net of
certain fees and expenses charged to the Trust. Because of these fees and
expenses, the dividend yield for SPDRs may be less than that of the S&P 500.
SPDRs are traded on the American Stock Exchange.

The Fund may also purchase put and call options on the S&P 500 and S&P 100
stock indices, which are traded on national securities exchanges. In addition,
the Fund may enter into transactions involving futures contracts (and futures
options) on these two stock indices and may purchase securities of other
investment companies that are structured to seek a similar correlation to the
S&P 500. These transactions are effected in an effort to have fuller exposure to
price movements in the S&P 500 pending investment of purchase orders or while
maintaining liquidity to meet potential shareholder redemptions. Transactions in
option and stock index futures contracts may be desirable to hedge against a
price movement in the S&P 500 at times when the Fund is not fully invested in
stocks that are included in the S&P 500. For example, by purchasing a futures
contract, the Fund may be able to reduce the potential that cash inflows will
disrupt its ability to track the S&P 500, since the futures contracts may serve
as a temporary substitute for stocks which may then be purchased in an orderly
fashion. Similarly, because futures contracts only require a small initial
margin deposit, the Fund may be able, as an effective matter, to be fully
invested in the S&P 500 while keeping a cash reserve to meet potential
redemptions. See Appendix B to this SAI.

Disclaimers. The Index 500 Fund is not sponsored, endorsed, sold or
promoted by Standard & Poor's Ratings Service, a division of McGraw-Hill
Companies, Inc. ("S&P"). S&P makes no representation or warranty, express or
implied, to the owners of the Index 500 Fund or any member of the public
regarding the advisability of investing in securities generally or in the Index
500 Fund particularly or the ability of the S&P 500 Index to trace general stock
market performance. S&P's only relationship to the Trust is the licensing of
certain trademarks and trade names of S&P and of the S&P 500 Index which is
determined, composed and calculated by S&P without regard to the Trust or the
Index 500 Fund. S&P has no obligation to take the needs of the Trust or the
owners of the Index 500 Fund into consideration in determining, composing or
calculating the S&P 500 Index. S&P is not responsible for and has not
participated in the determination of the prices and amount of the Index 500 Fund
or the timing of the issuance or sale of the Index 500 Fund or in the
determination or calculation of the equation by which the Index 500 Fund is to
be converted into cash. S&P has no obligation or liability in connection with
the administration, marketing or trading of the Index 500 Fund.

S&P does not guarantee the accuracy and/or the completeness of the S&P 500
Index or any data included therein and S&P shall have no liability for any
errors, omissions, or interruptions therein. S&P makes no warranty, express or
implied, as to results to be obtained by the Trust, owners of the Index 500
Fund, or any other person or entity from the use of the S&P 500 Index or any
data included therein. S&P makes no express or implied warranties, and expressly
disclaims all warranties of merchantability of fitness for a particular purpose
or use with respect to the S&P 500 Index or any data included therein. Without
limiting any of the foregoing, in no event shall S&P have any liability for any
special, punitive, indirect, or consequential damages (including lost profits),
even if notified of the possibility of such damages.

"Standard & Poor's", "S&P", "S&P 500", "Standard & Poor's 500", and "500"
are trademarks of McGraw-Hill, Inc. and have been licensed for use by the Trust.
The Index 500 Fund is not sponsored, endorsed, sold or promoted by S&P and S&P
makes no representation regarding the advisability of investing in the Index 500
Fund.

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<PAGE>

RISK FACTORS AND SPECIAL CONSIDERATIONS - MICHIGAN BOND FUND AND
TAX-FREE SHORT-INTERMEDIATE BOND FUND
[TO BE REVISED]

The information set forth below is derived in substantial part from the
official statements prepared in connection with the issuance of Michigan
municipal bonds and similar obligations and other sources that are generally
available to investors. The information is provided as general information
intended to give a recent historical description and is not intended to indicate
future or continuing trends in the financial or other positions of the State of
Michigan (the "State"). The Trust has not independently verified this
information.

The State's Constitution limits the amount of total State revenues raised
from taxes and other sources. State revenues (excluding federal aid and revenues
for payment of principal and interest on general obligation bonds) in any fiscal
year are limited to a specified percentage of State personal income in the prior
calendar year or average of the prior three calendar years, whichever is
greater. The percentage is based upon the ratio of the 1978-79 fiscal year
revenues to total 1977 State personal income. If any fiscal year revenues exceed
the revenue limitation by 1%, the entire amount exceeding the limitation must be
rebated in the following fiscal year's personal income tax or single business
tax. Annual excesses of less than 1% may be transferred into the State's Budget
Stabilization Fund. The State may raise taxes in excess of the limit in
emergency situations.

The State Constitution limits the purposes for which State general
obligation debt may be issued. Such debt is limited to short-term debt for State
operating purposes, short and long-term debt for the purpose of making loans to
school districts and long-term debt for voter approved purposes. The State's
Constitution also directs or restricts the use of certain revenues.

The State finances its operations through the State's General Fund and
special revenue funds. The General Fund receives revenues of the State that are
not specifically required to be included in the special revenue funds. General
Fund revenues are obtained approximately 55% from the payment of State taxes and
45% from federal and non-tax revenue sources. Tax revenues credited to the
General Fund include the personal income tax, the single business tax and
approximately 15% of the sales tax collections.

Expenditures are not permitted by the State Constitution to exceed
available revenues. The State Constitution requires that the Governor, with the
approval of the appropriating committees of the State House and Senate, reduce
expenditures whenever it appears that the actual revenues will be less than the
originally projected revenues upon which the budget was based.

In 1994, a ballot proposal ("Proposal A") to implement extensive property
tax and school finance reform measures was subject to voter approval and in fact
approved on March 15, 1994. Under Proposal A as approved, effective May 1, 1994,
the State sales and use tax increased from 4% to 6%, the State income tax
decreased from 4.6% to 4.4%, the cigarette tax increased from $.25 to $.75 per
pack, and an additional tax of 16% of the wholesale price is imposed on certain
other tobacco products. As of January 1, 1995, a 0.75% real estate transfer tax
also became effective. In 1994, a State education property tax of 6 mills was
imposed on all real property and personal property currently subject to the
general property tax. In addition, all school boards can now, with voter
approval, levy up to the lesser of 18 mills or the number of mills levied in
1993 for school operating purposes, on non-homestead property. Proposal A
contained additional provisions regarding the ability of local school districts
to levy taxes as well as a limit on assessment increases for each parcel of
property, beginning in 1995 to the lesser of 5% or the rate of inflation. When
property is subsequently sold, its assessed value is adjusted equal to 50% of
true cash value. Under Proposal A, much of the additional revenue generated by
these taxes is dedicated to the State School Aid Fund.

Proposal A shifts significant portions of the cost of local school
operations from local school districts to the State and raises additional State
revenues to fund these additional State expenses. These additional revenues will
be included within the State's constitutional revenue limitations and may impact
the State's ability to raise additional revenues in the future.

20
<PAGE>

The State is a party to various legal proceedings seeking damages or
injunctive or other relief. In addition to routine litigation, certain of these
proceedings could, if unfavorably resolved from the point of view of the State,
substantially affect State programs or finances. These lawsuits involve programs
generally in the areas of corrections, highway maintenance, social services, tax
collection, commerce and budgetary reductions to school districts and
governmental units and court funding. Although no opinion is expressed with
respect to the ultimate disposition and consequences of any litigation in
combination with any State Revenue loss, the implementation of any tax reduction
proposal or the failure of the State to realize any budget assumption, the
Attorney General of the State has indicated in a recent official statement
prepared in connection with issuance of general obligation bonds of the State
that, except as listed below, such ultimate dispositions and consequences of any
single proceeding or all legal proceedings should not themselves have a material
adverse effect on the security for such bonds.

On August 22, 1994, the Ingham Circuit and probate courts, together with
the 55th District Court, filed suits in the Court of Claims and Ingham County
Circuit Court against the State of Michigan and Ingham County for declaratory
and injunctive relief, and for damages, due to the alleged failure of the State
Court Administrative Office to properly calculate Ingham County's reimbursement
under the court funding statute. These cases have been dismissed by stipulation
of the parties because the plaintiffs are raising the same claims as members of
a class action captioned as 10th Judicial Circuit, et al v State of Michigan, et
al. Plaintiffs assert that the amount in controversy exceeds $5 million dollars.
The case is currently pending final class certification.

In an order dated June 10, 1997 and a decision rendered July 31, 1997, the
Michigan Supreme Court decided, in the consolidated cases of Durant v State of
Michigan and Schmidt v State of Michigan, that the special education, special
education transportation, bilingual education, driver training and school lunch
programs provided by local school districts are state mandated programs within
the meaning of Michigan Constitution, Article 9, (S) 29 (part of the so-called
Headlee Amendment) and, therefore, the state is obligated to fund these programs
at levels established by the Headlee Amendment. In fashioning a remedy in this
case of first impression under the Headlee Amendment, the Court concluded that,
in future cases, the correct remedy will typically be limited to a declaratory
judgment. However, due to the protracted nature of the Durant and Schmidt
litigation, the Court ruled that money damages, without interest, shall be paid
to the 84 plaintiff school districts for the full amount of the underfunding for
the state mandated programs during the 1991-92, 1992-93, and 1993-94 school
years. On November 19, 1997, the Governor signed legislation providing
approximately $212 million to the 84 plaintiff school districts to cover the
underfunding for those three years. That payment was made to the 84 plaintiff
school districts on April 15, 1998 from the State's Budget Stabilization Fund.
The board of education of each plaintiff school district is to determine the
appropriate distribution of the award between taxpayer relief and/or use by the
district for other public purposes. The Court has affirmed the award to
plaintiffs of their costs including attorney fees. Approximately 400 other
school districts have asserted similar claims. In companion legislation signed
by the Governor on November 19, 1997, the State will pay each "non-Durant"
school district for its underfunded state mandated program costs for those same
three years, if the district agreed, by March 2, 1998, to waive any claim
against the State of the same nature as the claims made by the 84 Durant
plaintiffs through September 30, 1997. All "non-Durant" school districts
submitted the statutory waiver by March 2, 1998. It is estimated that the
aggregate payments to the "non-Durant" school districts will, over time, total
$632 million. Those payments, commencing in fiscal year 1998-1999, will be paid
out of the Budget Stabilization Fund and the General Fund, half in annual
payments over 10 years and half in annual payments over 15 years.

On May 14, 1998, more than 100 Michigan school districts and individuals
filed suit in the Michigan Court of Appeals, asserting that the current version
of the state school aid act violates the Headlee Amendment, in much the same
manner as prior versions of the act were ruled unconstitutional by the Michigan
Supreme Court in Durant v State Board of Education, 456 Mich 175 (1977). Durant,
et al. v State, et al. ("Durant II"). The Durant II plaintiffs are claiming
damages of approximately $347 million for the 1997-1998 school year for the
State's alleged underfunding of special education services, special education
transportation, and school lunch programs. The Durant II plaintiffs are also
requesting a declaratory judgment that the current version of the state school
aid act will not provide proper funding levels for future school years. They
also seek attorney fees and costs of the litigation.

21
<PAGE>

The principal sectors of Michigan's diversified economy are the
manufacturing of durable goods (including automobiles and components and office
equipment), tourism and agriculture. The health of the State's economy, and in
particular its durable goods manufacturing industries, is susceptible to a long-
term increase in the cost of energy and energy related products. As reflected in
historical employment figures, the State's economy has lessened its dependence
upon durable goods manufacturing. In 1960, employment in such industry accounted
for 33% of the State's work force. By 1997, this figure had fallen to 14.5%.
Although manufacturing (including auto-related manufacturing) continues to be an
important part of the State's economy, approximately 66% of the civilian labor
force is currently engaged in service related employment.

On October 1, 1997, the State created the Year 2000 Project Office to
provide guidance, coordinate oversight for application software, manage Year
2000 funds, provide monitoring support, quality assurance and other matters. The
State has undertaken an inventory and assessment of all applications and
classified the software, has appropriated funds to carry out the project and
informed State agencies of the need to develop contingent plans for mission-
critical systems. The State's goal is to have all critical applications operable
by December 31, 1998, and all other applications operable by September 30, 1999.

Although the State is currently on schedule to meet its objectives for Year
2000 compliance, the State has not yet achieved Year 2000 compliance. Although
the State has expressed its belief that it will continue to meet the objectives
and time frames set forth above for the Year 2000 Project, there can be no
assurance that such completion will be done in a timely manner or that any other
organization or governmental agency with which the State electronically
interacts, including State vendors and the federal government, will be Year 2000
compliant. In the event of any such occurrences, the State may face material
adverse consequences with respect to its revenues and operations.

As of the date of this SAI, the State's general obligation bonds have been
rated "AA+" by Standard & Poor's Ratings Service, a division of The McGraw-Hill
Companies, Inc. ("S&P"), "Aa1" by Moody's Investors Service, Inc. ("Moody's"),
and "AA+" by Fitch ICBA ("Fitch"). In January, 1998, the State received an
upgrade from S&P from its prior rating of "AA". In March, 1998, the State
received an upgrade from Moody's from its prior rating of "Aa2". In April, 1998,
the State received an upgrade from Fitch from its prior rating of "AA". Such
ratings are in each case based upon certain information and materials concerning
the Bonds and the State furnished by the State to such rating agencies. Any
explanation of the significance of such ratings may be obtained only from the
rating agencies furnishing the same. There is no assurance that such ratings
will prevail for any given period of time or that they will not be revised
downward or withdrawn entirely by any or all of such rating agencies if, in the
judgment of any or all of them, circumstances so warrant. Any such downward
revision or withdrawal of such ratings, or any or all of them, may have an
adverse effect on the market price of the Bonds. To the extent that the
portfolio of Michigan municipal bonds is comprised of revenue of general
obligations of local governments or authorities, rather than general obligations
of the State of Michigan itself, ratings on such Michigan obligations will be
different from those given to the State of Michigan and their value may be
independently affected by economic matters not directly impacting the State.

INVESTMENT LIMITATIONS

Each Fund is subject to the investment limitations enumerated in this
section which may be changed with respect to a particular Fund only by a vote of
the holders of a majority of such Fund's outstanding shares (as defined under
"Miscellaneous-Shareholder Approvals").

No Fund of the Trust may:

1. Purchase securities of any one issuer (other than securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities
or certificates of deposit for any such securities) if more than 5% of
the value of the Fund's total assets (taken at current value) would be
invested in the securities of such issuer, or more than 10% of the
issuer's outstanding voting securities would be owned by the Fund or
the Trust, except that (a) with respect to each Fund, other than the
Michigan Bond Fund and the Tax-Free Short-Intermediate Bond Fund, up
to 25% of the value of the Fund's total assets (taken at current
value) may be invested without regard to these limitations and (b)
with respect to the Michigan Bond Fund and the Tax-Free Short-
Intermediate Bond Fund,

22
<PAGE>

up to 50% of the value of the Fund's total assets may be invested
without regard to these limitations so long as no more than 25% of the
value of the Fund's total assets are invested in the securities of any
one issuer. For purposes of this limitation, a security is considered
to be issued by the entity (or entities) whose assets and revenues
back the security. A guarantee of a security is not deemed to be a
security issued by the guarantor when the value of all securities
issued and guaranteed by the guarantor, and owned by the Fund, does
not exceed 10% of the value of the Fund's total assets;

2. Borrow money or issue senior securities except that each Fund may
borrow from banks and enter into reverse repurchase agreements for
temporary purposes in amounts up to one-third of the value of its
total assets at the time of such borrowing; or mortgage, pledge or
hypothecate any assets, except in connection with any such borrowing
and then in amounts not in excess of one-third of the value of the
Fund's total assets at the time of such borrowing. No Fund will
purchase securities while its aggregate borrowings (including reverse
repurchase agreements and borrowing from banks) in excess of 5% of its
total assets are outstanding. Securities held in escrow or separate
accounts in connection with a Fund's investment practices are not
deemed to be pledged for purposes of this limitation;

3. Purchase any securities which would cause 25% or more of the value of
the Fund's total assets at the time of purchase to be invested in the
securities of one or more issuers conducting their principal business
activities in the same industry, provided that (a) there is no
limitation with respect to (i) instruments that are issued (as defined
in investment limitation 1 above) or guaranteed by the United States,
any state, territory or possession of the United States, the District
of Columbia or any of their authorities, agencies, instrumentalities
or political subdivisions, (ii) with respect to the Money Market Funds
only, instruments issued by domestic branches of U.S. banks and (iii)
repurchase agreements secured by the instruments described in clause
(i) and, with respect to the Money Market Funds, clause (ii); (b)
wholly-owned finance companies will be considered to be in the
industries of their parents if their activities are primarily related
to financing the activities of the parents; and (c) utilities will be
divided according to their services, for example, gas, gas
transmission, electric and gas, electric and telephone will each be
considered a separate industry;

4. Purchase or sell real estate, except that each Fund may purchase
securities of issuers which deal in real estate and may purchase
securities which are secured by interests in real estate;

5. Acquire any other investment company or investment company security
except in connection with a merger, consolidation, reorganization or
acquisition of assets or where otherwise permitted by the 1940 Act;

6. Act as an underwriter of securities within the meaning of the
Securities Act of 1933, as amended, except to the extent that the
purchase of obligations directly from the issuer thereof, or the
disposition of securities, in accordance with the Fund's investment
objective, policies and limitations may be deemed to be underwriting;

7. Write or sell put options, call options, straddles, spreads, or any
combination thereof except for transactions in options on securities,
securities indices, futures contracts, options on futures contracts
and transactions in securities on a when-issued or forward commitment
basis, and except that each Equity and Bond Fund may enter into
forward currency contracts in accordance with its investment
objectives and policies. Notwithstanding the above, the Tax-Free
Short-Intermediate Bond Fund may not write or purchase options,
including puts, calls, straddles, spreads, or any combination
thereof;

8. Purchase securities of companies for the purpose of exercising
control;

23
<PAGE>

9. Purchase securities on margin, make short sales of securities or
maintain a short position, except that (a) this investment limitation
shall not apply to a Fund's transactions in futures contracts and
related options, a Fund's sale of securities short against the box or
a Fund's transactions in securities on a when-issued or forward
commitment basis, and (b) a Fund may obtain short-term credit as may
be necessary for the clearance of purchases and sales of portfolio
securities;

10. Purchase or sell commodity contracts, or invest in oil, gas or
mineral exploration or development programs, except that each Fund
may, to the extent appropriate to its investment policies, purchase
publicly traded securities of companies engaging in whole or in part
in such activities, may enter into futures contracts and related
options, and may engage in transactions in securities on a when-issued
or forward commitment basis, and except that each Equity Fund and Bond
Fund may enter into forward currency contracts in accordance with its
investment objectives and policies; or

11. Make loans, except that each Fund may purchase and hold debt
instruments (whether such instruments are part of a public offering or
privately negotiated), may enter into repurchase agreements and may
lend portfolio securities in accordance with its investment objective
and policies.

In addition, the Tax-Free Short-Intermediate Bond Fund may not:

1. Purchase or retain securities of any issuer if the officers or
Trustees of the Trust or its Advisor who own beneficially more than
one-half of 1% of the securities of such issuer together own
beneficially more than 5% of such securities;

2. Invest more than 10% of its total assets in the securities of issuers
which together with any predecessors have a record of less than three
years continuous operation; or

3. Participate on a joint or joint and several basis in any securities
trading account.

No Fund of Framlington may:

1. Purchase securities (except U.S. Government securities) if more than
5% of its total assets will be invested in the securities of any one
issuer, except that up to 25% of the assets of the Fund may be
invested without regard to this 5% limitation;

2. Invest 25% or more of its total assets in securities issued by one or
more issuers conducting their principal business activities in the
same industry (except that the Healthcare Fund will invest more than
25% of its total assets in securities of issuers conducting their
principal business activities in healthcare industries and the Global
Financial Services Fund will invest more than 25% of its total assets
in securities of issuers conducting their principal business
activities in the financial services industry);

3. Borrow money or enter into reverse repurchase agreement except that
the Fund may (i) borrow money or enter into reverse repurchase
agreements for temporary purposes in amounts not exceeding 5% of its
total assets and (ii) borrow money for the purpose of meeting
redemption requests, in amounts (when aggregated with amounts borrowed
under clause (i)) not exceeding 33 1/3% of its total assets;

4. Pledge, mortgage or hypothecate its assets other than to secure
borrowings permitted by investment limitation 3 above (collateral
arrangements with respect to margin requirements for options and
futures transactions are not deemed to be pledges or hypothecations
for this purpose);

24
<PAGE>

5. Make loans of securities to other persons in excess of 25% of the
Fund's total assets; provided the Fund may invest without limitation
in short-term debt obligations (including repurchase agreements) and
publicly distributed debt obligations;

6. Underwrite securities of other issuers, except insofar as the Fund may
be deemed an underwriter under the Securities Act of 1933, as amended,
in selling portfolio securities;

7. Purchase or sell real estate or any interest therein, including
interests in real estate limited partnerships, except securities
issued by companies (including real estate investment trusts) that
invest in real estate or interests therein;

8. Purchase securities on margin, or make short sales of securities
(except that the Global Financial Services Fund may make short sales
of securities), except for the use of short-term credit necessary for
the clearance of purchases and sales of portfolio securities, but the
Fund may make margin deposits in connection with transactions in
options, futures and options of futures;

9. Make investments for the purpose of exercising control or management;

10. Invest in commodities or commodity futures contracts, provided that
this limitation shall not prohibit the purchase or sale by the Fund of
forward foreign currency exchange contracts, financial futures
contracts and options on financial futures contracts, foreign currency
futures contracts, and options on securities, foreign currencies and
securities indices, as permitted by the Fund's Prospectus; or

11. Issue senior securities, except as permitted by the 1940 Act.

Additional investment restrictions adopted by each Fund of Framlington
which may be changed by the Board of Trustees, provide that each Fund may
not:

1. Invest more than 15% of its net assets in illiquid securities;

2. Own more than 10% (taken at market value at the time of purchase) of
the outstanding voting securities of any single issuer; or

3. Invest in other investment companies except as permitted under the
1940 Act.

No Fund of the Company may:

1. Invest more than 25% of its total assets in any one industry (i)
provided that securities issued or guaranteed by the U.S. Government,
its agencies or instrumentalities are not considered to represent
industries; (ii) except that the Real Estate Fund will invest more
than 25% of its assets in securities of issuers in the real estate
industry; (iii) except that the NetNet Fund will invest more than 25%
of its assets in securities of companies engaged in the research,
design, development, manufacturing or distribution of products,
processes or services for use with the Internet or Intranet related
businesses; and (iv) provided that with respect to the Equity
Selection Fund, utilities will be divided according to their services,
for example, gas, gas transmission, electric and gas, electric and
telephone will each be considered a separate industry;

2. (For each Fund except the International Bond Fund) with respect to 75%
of the Fund's assets, invest more than 5% of the Fund's assets (taken
at a market value at the time of purchase) in the outstanding
securities of any single issuer or own more than 10% of the
outstanding voting securities of any one issuer, in each case other
than securities issued or guaranteed by the U.S. Government, its
agencies or instrumentalities;

25
<PAGE>

3. Borrow money or issue senior securities (as defined in the 1940 Act)
except that the Funds may borrow (i) for temporary purposes in amounts
not exceeding 5% of its total assets and (ii) to meet redemption
requests, in amounts (when aggregated with amounts borrowed under
clause (i)) not exceeding 33 1/3% of its total assets;

5. Make loans of securities to other persons in excess of 25% of a Fund's
total assets and 33 1/3% of the Money Market Fund's total assets;
provided the Funds may invest without limitation in short-term debt
obligations (including repurchase agreements) and publicly distributed
debt obligations;

6. Underwrite securities of other issuers, except insofar as a Fund may
be deemed an underwriter under the Securities Act of 1933, as amended,
in selling portfolio securities;

7. (For each Fund except the Real Estate Fund) purchase or sell real
estate or any interest therein, including interests in real estate
limited partnerships, except securities issued by companies (including
real estate investment trusts) that invest in real estate or interests
therein. The Real Estate Fund may not buy or sell real estate;
however, this prohibition does not apply to the purchase or sale of
(i) securities which are secured by real estate, (ii) securities
representing interests in real estate, (iii) securities of companies
operating in the real estate industry including real estate investment
trusts, and (iv) the holding and sale of real estate acquired as a
result of the ownership of securities;

8. Purchase securities on margin, or make short sales of securities,
except for the use of short-term credit necessary for the clearance of
purchases and sales of portfolio securities, but the Funds (with the
exception of the Money Market Fund and Short Term Treasury Fund) may
make margin deposits in connection with transactions in options,
futures and options on futures;

9. Make investments for the purpose of exercising control or management;
or

10. Invest in commodities or commodity futures contracts, provided that
this limitation shall not prohibit the purchase or sale by the Growth
Opportunities, Multi-Season, NetNet, Real Estate, Value and
International Bond Funds of forward currency contracts, financial
futures contracts and options on financial futures contracts, and
options on securities and on securities, foreign currencies and on
securities indices, as permitted by each Fund's prospectus.

In addition, the Short Term Treasury Fund may not:

1. Borrow money or enter into reverse repurchase agreements except that
the Fund may (i) borrow money or enter into reverse repurchase
agreements for temporary purposes in amounts exceeding 5% of its total
assets and (ii) borrow money for the purpose of meeting redemption
requests, in amounts (when aggregated with amounts borrowed under
clause (i)) not exceeding 33 1/3% of its total assets;

2. Pledge, mortgage or hypothecate its assets other than to secure
borrowings permitted by investment limitation 1 above; or

3. Issue any senior securities (as such term is defined in Section 18(f)
of the 1940 Act) except to the extent the activities permitted by
other enumerated investment limitations for the Company above may be
deemed to give rise to a senior security.

26
<PAGE>

Additional investment restrictions adopted by each Fund of the Company,
which may be changed by the Board of Directors, provide that a Fund may not:

1. Invest more than 15% of its net assets (10% of net assets for the
Money Market Fund) (taken at market value at the time of purchase) in
securities which cannot be readily resold because of legal or
contractual restrictions and (in the case of International Bond Fund
and Short Term Treasury Fund only) which are not otherwise marketable;

2. (For each Fund except the International Bond Fund and Short Term
Treasury Fund) own more than 10% (taken at market value at the time of
purchase) of the outstanding voting securities of any single issuer;

3. (For each Fund except Short Term Treasury Fund) purchase or sell
interests in oil, gas or other mineral exploration or development
plans or leases); or

4. Invest in other investment companies except as permitted under the
1940 Act.

In addition, the International Bond Fund may not with respect to 50% of the
Fund's assets, invest more than 5% of the Fund's assets (taken at a market value
at the time of purchase) in the outstanding securities of any single issuer or
own more than 10% of the outstanding voting securities of any one issuer, in
each case other than securities issued or guaranteed by the U.S. Government, its
agencies or instrumentalities, at the close of each quarter of its taxable year.

If a percentage limitation is satisfied at the time of investment, a later
increase or decrease in such percentage resulting from a change in the value of
a Fund's investments will not constitute a violation of such limitation, except
that any borrowing by a Fund that exceeds the fundamental investment limitations
stated above must be reduced to meet such limitations within the period required
by the 1940 Act (currently three days). Otherwise, a Fund may continue to hold a
security even though it causes the Fund to exceed a percentage limitation
because of fluctuation in the value of the Fund's assets.

TEMPORARY DEFENSIVE POSITION

During periods of unusual economic or market conditions or for temporary
defensive purposes or liquidity, each Fund (other than the Index 500 Fund) may
invest without limit in cash and in U.S. dollar-denominated high quality money
market and other short-term instruments. These investments may result in a
lower yield than would be available from investments with a lower quality or
longer term.

MANAGEMENT OF THE FUND
TRUSTEES, DIRECTORS AND OFFICERS

The trustees, directors and executive officers of the Trust, Framlington
and the Company, and their business addresses, ages, and principal occupations
during the past five years, are:

27
<PAGE>

<TABLE>
<CAPTION>
Positions with Trust, Company and Principal Occupation
Name, Address and Age Framlington+ During Past Five Years
- --------------------- ------------ ----------------------
<S> <C> <C>
Charles W. Elliott Trustee/Director and Chairman of Senior Advisor to the President,
1024 Essex Circle the Board of Trustees and Western Michigan University (since
Kalamazoo, MI 49008 Directors July 1995); Executive Vice President,
Age: 67 Administration & Chief Financial
Officer, Kellogg Company (January 1987
through June 1995). Board of
Directors, Steelcase Financial
Corporation; Board of Directors,
Enesco Group.

John Rakolta, Jr. Trustee/Director and Vice Chairman Chairman and Chief Executive Officer,
1876 Rathmor of the Boards of Trustees and Walbridge Aldinger Company
Bloomfield Hills, MI 48304 Directors (construction company).
Age: 52

Thomas B. Bender Trustee/Director Partner, Financial & Investment
7 Wood Ridge Road Management Group.
Glen Arbor, MI 49636
Age: 66

David J. Brophy Trustee/Director Professor, University of Michigan.
1025 Martin Place Director, River Place Financial
Ann Arbor, MI 48104 Corporation.
Age: 63

Dr. Joseph E. Champagne Trustee/Director Dean, University Center, Macomb
319 East Snell Road College (since September 1997);
Rochester, MI 48306 Corporate and Executive Consultant
Age: 61 (since September 1993); Chancellor,
Lamar University (September 1994 to
September 1995); Chairman of Board of
Directors, Ross Controls of Troy,
Michigan.

Thomas D. Eckert Trustee/Director President and Chief Executive Officer,
10726 Falls Pointe Drive Capital Automotive REIT (real estate
Great Falls, VA 22066 investment trust specializing in
Age: 51 retail automotive properties) (since
November 1997); President,
Mid-Atlantic Region of Pulte Home
Corporation (developer of residential
land and construction of housing
units) (1983 to 1997); Director,
Celotex Corporation (building products
manufacturer).
</TABLE>

28
<PAGE>

<TABLE>
<S> <C> <C>
Lee P. Munder* Trustee/Director and President Chairman of the Advisor (since
1029 N. Ocean Blvd. February 1998); Chief Executive
Palm Beach, FL 33480 Officer of the Advisor (1995 to 1998);
Age: 54 Chief Executive Officer, World Asset
Management (January 1995-December
1997); Chief Executive Officer, Old
MCM (predecessor of Advisor) (since
February 1985); Director, LPM
Investment Services, Inc. ("LPM");
Director, Capital Automotive REIT.

Terry H. Gardner Vice President, Vice President and Chief Financial
480 Pierce Street Chief Financial Officer, Treasurer Officer of the Advisor (since 1993),
Suite 300 and Secretary Vice President and Chief Financial
Birmingham, MI 48009 Officer, Old MCM (since 1993);
Age: 38 Secretary, LPM (since June 1993).

Paul Tobias Vice President Chief Executive Officer of the Advisor
480 Pierce Street (since February 1998); Chief Operating
Suite 300 Officer of the Advisor (since April
Birmingham, MI 48009 1995); Executive Vice President of the
Age: 48 Advisor (April 1995 to February 1998);
Executive Vice President, Comerica,
Inc. (October 1990 to April 1995).

Gerald Seizert Vice President Chief Investment Officer/Equities of
480 Pierce Street the Advisor (since April 1995);Chief
Suite 300 Executive Officer of the Advisor
Birmingham, MI 48009 (February 1998-August 1999); Executive
Age: 47 Vice President of the Advisor (April
1995 to February 1998); Managing
Director (1991 to 1995), Director
(1992 to 1995), and Vice President
(1984 to 1991) of Loomis, Sayles and
Company, L.P. (investment counseler).

Elyse G. Essick Vice President Vice President and Director of
480 Pierce Street Communications and Client Services
Suite 300 of the Advisor (since January 1995).
Birmingham, MI 48009
Age: 41

James C. Robinson Vice President Executive Vice President and Chief
480 Pierce Street Investment Officer/Fixed Income of the
Suite 300 Advisor (since January 1995).
Birmingham, MI 48009
Age: 38
</TABLE>

29
<PAGE>

<TABLE>
<S> <C> <C>
Leonard J. Barr Vice President Vice President and Director of Core
480 Pierce Street Equity Research of the Advisor (since
Suite 300 January 1995 ); Director and Senior
Birmingham, MI 48009 Vice President, Old MCM (since 1988);
Age: 55 Director of LPM (since June 1993).

Ann F. Putallaz Vice President Vice President and Director of
480 Pierce Street Retirement Services Group of the
Suite 300 Advisor (since January 1995).
Birmingham, MI 48009
Age: 54

Therese Hogan Assistant Secretary Director, State Regulation Department,
101 Federal Street First Data Investor Services Group
Boston, MA 02110 (since June 1994).
Age: 37

Libby Wilson Assistant Secretary Director of Mutual Fund Operations
480 Pierce Street of the Advisor (since July 1999);
Suite 300 Global Portfolio Client Associate of
Birmingham, MI 48009 Invesco Global Asset Management (investment
Age: 30 advisor) (March 1999 to July 1999); Manager
of Mutual Funds Operations of the Advisor
(May 1996 to March 1999); Administrator
of Mutual Funds Operations (March 1993 to
May 1996).

Mary Ann Shumaker Assistant Secretary Associate General Counsel of the
480 Pierce Street Advisor (since July 1997); and
Suite 300 Counsel, Miro Weiner & Kramer (law firm)
Birmingham, MI 48009 (1991 to 1997).
Age: 34
</TABLE>

_______________________
+ Individual holds same position with St. Clair Funds, Inc., ("St. Clair") a
registered investment company.
* Trustee/Director is an "Interested person" of the Trust, Framlington and
the Company as defined in the 1940 Act.

Trustees who are not interested persons of the Trust and Framlington and
Directors who are not interested persons of the Company receive an aggregate fee
from the Trust, Framlington the Company and St. Clair for service on those
organizations' respective Boards, comprised of an annual retainer fee of $35,000
and a fee of $3,000 for each Board meeting attended; and are reimbursed for all
out-of-pocket expenses relating to attendance at such meetings.

The following table summarizes the compensation paid by the Trust,
Framlington, the Company and St. Clair to their respective Trustees/Directors
for the year ended June 30, 1999.

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
Charles W. Elliot John Rakolta, Jr. Thomas B. David J. Dr. Joseph E. Thomas D.
Chairman Vice Chairman Bender Brophy Champagne Eckert
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------
Aggregate Compensation
from the Company $ 8,908 $ 8,908 $ 8,908 $ 8,908 $ 8,908 $ 8,908
(comprised of 15 funds)
- ---------------------------------------------------------------------------------------------------------------------------
Aggregate Compensation
from the Trust $29,448 $29,448 $29,448 $29,448 $29,448 $29,448
(comprised of 14 funds)
- ---------------------------------------------------------------------------------------------------------------------------
Aggregate Compensation
from Framlington $ 713 $ 713 $ 713 $ 713 $ 713 $ 713
(comprised of 4 funds)
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
Charles W. Elliot John Rakolta, Jr. Thomas B. David J. Dr. Joseph E. Thomas D.
Chairman Vice Chairman Bender Brophy Champagne Eckert
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Aggregate Compensation
from St. Clair $ 931 $ 931 $ 931 $ 931 $ 931 $ 931
- ------------------------------------------------------------------------------------------------------------------------
Pension Retirement
Benefits Accrued as
Part of Fund Expenses None None None None None None
- ------------------------------------------------------------------------------------------------------------------------
Estimated Annual
Benefits upon Retirement None None None None None None
- ------------------------------------------------------------------------------------------------------------------------
Total from the Fund
Complex $ 40,000 $ 40,000 $40,000 $40,000 $ 40,000 $ 40,000
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>

No officer, director or employee of the Advisor, World, the Sub-Advisor,
the Custodian, the Distributor, the Administrator or the Transfer Agent
currently receives any compensation from the Trust, Framlington or the Company.
As of September 26, 1999, the Trustees and officers of the Trust, as a group,
owned less than 1% of all classes of outstanding shares of the Funds of the
Trust, the Trustees and officers of Framlington, as a group, owned less than 1%
of all classes of outstanding shares of the Funds of Framlington except the
_______ Fund in which Trustees and officers, as a group, owned ______% of Class
_____shares of the Fund, and the Directors and officers of the Company, as a
group, owned less than 1% of all classes of outstanding shares of the Funds of
the Company except _____ Fund in which the Directors and officers, as a group,
owned ______% of Class ____ shares of the Fund.

[Lee P. Munder and Terry H. Gardner are administrators of a pension plan
for employees of Munder Capital Management, which as of September 26, 1999,
owned _____ Class ____ shares of the _______ Fund, which represented less than
1% of the outstanding Class _____ Shares of the Fund. As of the same date, the
pension plan owned _____ Class ___ shares of the Fund, which represented ____%
of the outstanding Class ___ shares the Fund.]

As of September 26, 1999, the Advisor and its affiliates, through common
ownership, owned beneficially _______ Class ____ shares of the Fund, which
represented less than ___%, of the outstanding Class ___ shares of the Fund,
respectively.

Shareholder and Trustee Liability. Under Massachusetts law, shareholders of
a business trust may, under certain circumstances, be held personally liable for
the obligations of the trust. However, the Trust's and Framlington's Declaration
of Trust, as amended, each provide that shareholders shall not be subject to any
personal liability in connection with the assets of the Trust or Framlington for
the acts or obligations of the Trust or Framlington, and that every note, bond,
contract, order or other undertaking made by the Trust or Framlington shall
contain a provision to the effect that the shareholders are not personally
liable thereunder. Each Declaration of Trust, as amended, provides for
indemnification out of the trust property of any shareholder held personally
liable solely by reason of his or her being or having been a shareholder and not
because of his or her acts or omissions or some other reason. Each Declaration
of Trust, as amended, also provides that the Trust and Framlington shall, upon
request, assume the defense of any claim made against any shareholder for any
act or obligation of the Trust or Framlington, and shall satisfy any judgment
thereon. Thus, the risk of a shareholder's incurring financial loss on account
of shareholder liability is limited to circumstances in which the Trust or
Framlington itself would be unable to meet its obligations.

Each Declaration of Trust, as amended, further provides that all persons
having any claim against the Trustees, the Trust or Framlington shall look
solely to the trust property for payment; that no Trustee of the Trust or
Framlington shall be personally liable for or on account of any contract, debt,
tort, claim, damage, judgment or

31
<PAGE>

decree arising out of or connected with the administration or preservation of
the trust property or the conduct of any business of the Trust or Framlington;
and that no Trustee shall be personally liable to any person for any action or
failure to act except by reason of his own bad faith, willful misfeasance, gross
negligence or reckless disregard of his duties as a trustee. With the exception
stated, each Declaration of Trust, as amended, provides that a Trustee is
entitled to be indemnified against all liabilities and expenses reasonably
incurred by him in connection with the defense or disposition of any proceeding
in which he may be involved or with which he may be threatened by reason of
being or having been a Trustee, and that the Trustees will indemnify officers,
representatives and employees of the Trust and Framlington to the same extent
that Trustees are entitled to indemnification.

INVESTMENT ADVISORY AND OTHER SERVICE ARRANGEMENTS

Investment Advisor, World and Sub-Advisor. The Advisor of each Fund (other
than the Index 500 Fund and the International Equity Fund) is Munder Capital
Management, a Delaware general partnership. The Advisor replaced Woodbridge
Capital Management, Inc. ("Woodbridge") as investment advisor to the investment
portfolios of the Trust and replaced Munder Capital Management, Inc. as the
investment advisor to the investment portfolios of the Company on January 31,
1995, upon the closing agreement (the "Joint Venture Agreement") among Old MCM,
Comerica, Woodbridge and WAM, pursuant to which Old MCM contributed its
investment advisory business and Comerica contributed the investment advisor
business of its indirect subsidiaries, Woodbridge and World Asset Management, to
the Advisor. The general partners of the Advisor are WAM, WAM II, Old MCM and
Munder Group LLC. WAM and WAM II are wholly-owned subsidiaries of Comerica Bank-
Ann Arbor, which in turn. is a wholly-owned subsidiary of Comerica Incorporated,
a publicly-held bank holding company.

The investment advisor for the Index 500 Fund and the International Equity
Fund is World Asset Management, L.L.C., a Delaware limited liability company.
World is a wholly-owned subsidiary of the Advisor.

The Funds have entered into Investment Advisory Agreements (the "Advisory
Agreements"), dated July 2, 1998, with the Advisor or World which have been
approved by the shareholders.

Under the terms of the Advisory Agreements, the Advisor or World furnishes
continuing investment supervision to the Funds and is responsible for the
management of the Funds' portfolios. The responsibility for making decisions to
buy, sell or hold a particular security rests with the Advisor or World, subject
to review by the Trust's and the Company's Boards of Directors/Trustees. Under
the terms of the Advisory Agreement between the Advisor and Framlington, the
Advisor furnishes overall investment management for the Framlington Funds,
provides research and credit analysis, oversees the purchase and sale of
portfolio securities by the Sub-Advisor, maintains books and records with
respect to the Funds' securities transactions and provides periodic and special
reports to the Board of Trustees as requested.

The Advisory Agreements will continue in effect for a period of two years
from their effective dates. If not sooner terminated, each Advisory Agreement
will continue in effect for successive one year periods thereafter, provided
that each continuance is specifically approved annually by (a) the vote of a
majority of the Boards of Directors/Trustees who are not parties to the Advisory
Agreement or interested persons (as defined in the 1940 Act), cast in person at
a meeting called for the purpose of voting on such approval, and (b) either (i)
the vote of a majority of the outstanding voting securities of the affected
Fund, or (ii) the vote of a majority of the Boards of Directors/Trustees. Each
Advisory Agreement is terminable with respect to a Fund by vote of the Boards of
Directors/Trustees, or by the holders of a majority of the outstanding voting
securities of the Fund, at any time without penalty, on 60 days' written notice
to the Advisor or World. The Advisor or World may also terminate its advisory
relationship with respect to a Fund without penalty on 90 days' written notice
to the Trust, Framlington or the Company, as applicable. Each Advisory Agreement
terminates automatically in the event of its assignment (as defined in the 1940
Act).

The Sub-Advisor is a subsidiary of Framlington Group Limited, which is
incorporated in England and Wales and, through its subsidiaries, provides a wide
range of investment services. Framlington Group Limited is a

32
<PAGE>

wholly owned subsidiary of Framlington Holdings Limited which is, in turn, owned
49% by the Advisor and 51% by Credit Commercial de France S.A., a French banking
corporation listed on the Societe des Bourses Francaises.

The Framlington Funds have entered into a Sub-Advisory Agreement, dated
July 2, 1998, with the Advisor and the Sub-Advisor which has been approved by
the shareholders of the Framlington Funds. Under the terms of the Sub-Advisory
Agreement, the Sub-Advisor provides sub-advisory services to the Framlington
Funds. Subject to the supervision of the Advisor, the Sub-Advisor is responsible
for the management of each Fund's portfolio, including decisions regarding
purchases and sales of portfolio securities by the Framlington Funds. The Sub-
Advisor is also responsible for arranging the execution of portfolio management
decisions, including the selection of brokers to execute trades and the
negotiation of related brokerage commissions.

The Sub-Advisory Agreement, with respect to each Fund, will continue in
effect with respect to each Fund for a period of two years from its effective
date. If not sooner terminated, the Sub-Advisory Agreement will continue in
effect for successive one year periods thereafter, provided that each
continuance is specifically approved annually by (a) the vote of a majority of
the Board of Trustees who are not parties to the Sub-Advisory Agreement or
interested persons (as defined in the 1940 Act), cast in person at a meeting
called for the purpose of voting on approval, and (b) either (i) with respect to
a Fund, the vote of a majority of the outstanding voting securities of that
Fund, or (ii) the vote of a majority of the Board of Trustees. The Sub-Advisory
Agreement is terminable by vote of the Board of Trustees, or, with respect to a
Fund, by the holders of a majority of the outstanding voting securities of that
Fund, at any time without penalty, on 60 days' written notice to the Sub-
Advisor, or by the Advisor on 90 days' written notice to the Sub-Advisor. The
Sub-Advisor may also terminate its sub-advisory relationship with a Fund without
penalty on 90 days' written notice to Framlington. The Sub-Advisory Agreement
terminates automatically in the event of its assignment (as defined in the 1940
Act).

For the advisory services provided and expenses assumed by it, the Advisor
has agreed to a fee from each Fund computed daily and payable monthly at the
rates set forth below:

1.25% of average daily net assets
. Emerging Markets Fund**

1.00% of the first $500 million of average daily net assets and .75%
of net assets in excess of $500 million
. Multi-Season Fund*

1.00% of the first $250 million of average daily net assets and .75%
of net assets in excess of $250 million
. International Growth Fund**
. Healthcare Fund**

1.00% of average daily net assets
. Micro-Cap Fund**
. NetNet Fund**

.75% of average daily net assets
. Equity Selection Fund
. Global Financial Services Fund
. Growth & Income Fund
. Growth Opportunities Fund
. International Equity Fund
. Small-Cap Value Fund
. Small Company Growth Fund

.74% of average daily net assets
. Real Estate Fund

33
<PAGE>

. Value Fund

.65% of average daily net assets
. Balanced Fund

.50% of average daily net assets
. Bond Fund
. Intermediate Bond Fund
. International Bond Fund
. U.S. Income Fund
. Michigan Bond Fund
. Tax-Free Bond Fund
. Tax-Free Short-Intermediate Bond Fund

.40% of average daily net assets
. Money Market Fund

.35% of average daily net assets
. Cash Investment Fund
. Tax-Free Money Market Fund
. U.S. Treasury Money Market Fund

.25% of average daily net assets
. Short Term Treasury Fund**

________________________

* The Advisor expects to receive, after waivers, an advisory fee at the
annual rate of .75% of average daily net assets of Multi-Season Fund during
the current fiscal year.

** The Advisor expects to voluntarily reimburse expenses during the current
fiscal year with respect to the Micro-Cap Fund, the NetNet Fund, Short Term
Treasury Fund, Growth Opportunities Fund, International Growth Fund,
Emerging Markets Fund, Healthcare Fund and Global Financial Services Fund.

The Advisor may discontinue such fee waivers and/or expense reimbursements
at any time, in its sole discretion.

The Advisor pays the Sub-Advisor a monthly fee equal on an annual basis to
up to 0.50% of average daily net assets up to $250 million, reduced to .375% of
average daily net assets in excess of $250 million for the International Growth
Fund and the Healthcare Fund, up to .625% of average daily net assets for the
Emerging Markets Fund and .375% of average daily net assets for the Global
Financial Services Fund.

For the advisory services provided and expenses assumed by it, World has
agreed to a fee from each Fund computed daily and payable monthly at the rates
set forth below:

.20% of the first $250 million of average daily net assets;
0.12% of the next $250 million of net assets
and .07% of net assets in excess of $500 million
. Index 500 Fund

.75% of average daily net assets
. International Equity Fund

For the fiscal year ended June 30, 1997 (and for the period from
commencement of operations through June 30, 1997 for the International Growth,
Emerging Markets, Healthcare, Micro-Cap, Small-Cap Value, Short Term Treasury
and International Bond Funds), the Advisor received fees after waivers, if any,
of $445,259 for the

34
<PAGE>

Balanced Fund, $1,650,704 for the Growth & Income Fund, $249,764 for the Index
500 Fund, $1,720,496 for the International Equity Fund, $1,884,242 for the Small
Company Growth Fund, $751,954 for the Bond Fund, $2,554,647 for the Intermediate
Bond Fund, $1,175,733 for the U.S. Income Fund, $132,451 for the Michigan Bond
Fund, $1,006,688 for the Tax-Free Bond Fund, $1,584,769 for the Tax-Free Short-
Intermediate Bond Fund, $3,454,159 for the Cash Investment Fund, $879,155 for
the Tax-Free Money Market Fund, $1,101,183 for the U.S. Treasury Money Market
Fund, $3,189,742 for the Multi-Season Fund, $259,015 for the Real Estate Fund,
$599,286 for the Money Market Fund, $401,505 for the Value Fund, $71,843 for the
International Growth Fund, $25,210 for the Emerging Markets Fund, $11,440 for
the Healthcare Fund, $6,479 for the Micro-Cap Equity Fund, $20,442 for the
Small-Cap Value Fund, $51,885 for the Short Term Treasury Fund and $143,476 for
the International Bond Fund.

For the fiscal year ended June 30, 1998 (and for the period from
commencement of operations through June 30, 1998 for the Global Financial
Services Fund and Growth Opportunities Fund), the Advisor received fees after
waivers, if any, of $524,133 for the Balanced Fund, $1,900,685 for the Growth &
Income Fund, $884,003 for the Index 500 Fund, $1,628,425 for the International
Equity Fund, $3,045,349 for the Small Company Growth Fund, $1,116,093 for the
Bond Fund, $2,770,357 for the Intermediate Bond Fund, $1,386,132 for the U.S.
Income Fund, $261,589 for the Michigan Bond Fund, $1,017,292 for the Tax-Free
Bond Fund, $1,542,255 for the Tax-Free Short-Intermediate Bond Fund, $3,750,786
for the Cash Investment Fund, $1,075,987 for the Tax-Free Money Market Fund,
$470,094 for the U.S. Treasury Money Market Fund, $6,169,411 for the Multi-
Season Fund, $612,857 for the Real Estate Fund, $454,600 for the Money Market
Fund, $1,066,142 for the Value Fund, $516,840 for the International Growth Fund,
$554,427 for the Emerging Markets Fund, $143,897 for the Healthcare Fund,
$304,989 for the Micro-Cap Equity Fund, $1,028,013 for the Small-Cap Value Fund,
$135,827 for the Short Term Treasury Fund, $253,258 for the International Bond
Fund, $62,684 for NetNet Fund, $302 for the Global Financial Services Fund and
$193 for the Growth Opportunities Fund.

For the fiscal year ended June 30, 1999 (and for the period of commencement
of operations through June 30, 1999 for the Equity Selection Fund) the Advisor
received fees after waivers, if any, of $ for the Balanced Fund, $ for the
Equity Selection Fund, $ for the Growth & Income Fund, $ for the Growth
Opportunities Fund $ for the Index 500 Fund, $ for the International Equity
Fund, $ for the Micro-Cap Equity Fund, $ for the Multi-Season Fund, $ for
NetNet Fund, $ for the Real Estate Fund, $ for the Small-Cap Value Fund, $
for the Small Company Growth Fund, $ for the Value Fund, $ for the Bond
Fund, $ for the Intermediate Bond Fund, $ for the International Bond Fund,
$ for the Michigan Bond Fund, $ for the Short Term Treasury Fund, $ for
the Tax-Free Bond Fund, $ for the Tax-Free Short-Intermediate Bond Fund,
$ for the U.S. Income Fund, $ for the Cash Investment Fund, $ for the
Money Market Fund, $ for the Tax-Free Money Market Fund, $ for the U.S.
Treasury Money Market Fund, $ for the International Growth Fund, $ for
the Emerging Markets Fund, $ for the Healthcare Fund and $ for the Global
Financial Services Fund.

For the fiscal year ended June 30, 1997 the Advisor voluntarily waived
advisory fees and/or reimbursed expenses in the amounts of $1,063,248 for the
Multi-Season Fund, $10,143 for the Real Estate Fund, $17,688 for the Value Fund,
$360,721 for the Index 500 Fund and $51,815 for the Michigan Bond Fund.

For the fiscal year ended June 30, 1998, the Advisor voluntarily waived
advisory fees and/or reimbursed expenses in the amounts of $421,846 for the
Index 500 Fund, $75,264 for the Micro-Cap Equity Fund, $1,214,795 for the Multi-
Season Growth Fund, $110,473 for the Emerging Markets Fund, $112,541 for the
Healthcare Fund, $105,456 for the International Growth Fund, $62,711 for the
Short Term Treasury Fund, $33,890 for the NetNet Fund and $2 for the Growth
Opportunities Fund.

For the fiscal year ended June 30, 1999, the Advisor voluntarily waived
advisory fees and/or reimbursed expenses in the amounts of $ for the Growth
Opportunities Fund, $ for the Index 500 Fund, $ for the Micro-Cap Equity
Fund, $ for the Multi-Season Growth Fund, $ for the NetNet Fund, $
for the Short Term Treasury Fund, $ for the Emerging Markets Fund, $ for
the Healthcare Fund and $ for the International Growth Fund.

Distribution Agreements. The Trust, Framlington and the Company have
entered into distribution agreements, under which the Distributor, as agent,
sells shares of each Fund on a continuous basis. The Distributor

35
<PAGE>

has agreed to use appropriate efforts to solicit orders for the purchase of
shares of each Fund, although it is not obligated to sell any particular amount
of shares. The Distributor pays the cost of printing and distributing
prospectuses to persons who are not holders of shares of the Funds (excluding
preparation and printing expenses necessary for the continued registration of
the shares) and of printing and distributing all sales literature. The
Distributor's principal offices are located at 60 State Street, Boston,
Massachusetts 02109.

Distribution Services Arrangements - Class A, Class B and Class C Shares.
Each Fund has adopted a Service Plan with respect to its Class A Shares pursuant
to which it uses its assets to finance activities relating to the provision of
certain shareholder services. Under the Service and Distribution Plans for Class
A Shares, the Distributor is paid an annual service fee at the rate of up to
0.25% of the value of average daily net assets of the Class A Shares of each
Fund. Each Fund has also adopted Service and Distribution Plans with respect to
its Class B and Class C Shares, pursuant to which it uses its assets to finance
activities relating to the distribution of its shares to investors and provision
of certain shareholder services. Under the Service and Distribution Plans for
Class B and Class C Shares, the Distributor is paid an annual service fee of up
to 0.25% of the value of average daily net assets of the Class B and Class C
Shares of each Fund and an annual distribution fee at the rate of up to 0.75% of
the value of average daily net assets of the Class B and Class C Shares of each
Fund.

Under the terms of the Service and Distribution Plans (collectively, the
"Plans"), each Plan continues from year to year, provided such continuance is
approved annually by vote of the Boards of Directors/Trustees, including a
majority of the Directors/Trustees who are not interested persons of the Trust,
Framlington or the Company, as applicable, and who have no direct or indirect
financial interest in the operation of that Plan (the "Non-Interested Plan
Directors"). The Plans may not be amended to increase the amount to be spent for
the services provided by the Distributor without shareholder approval, and all
amendments of the Plans also must be approved by the Directors/Trustees in the
manner described above. Each Plan may be terminated at any time, without
penalty, by vote of a majority of the Non-Interested Plan Directors or by a vote
of a majority of the outstanding voting securities (as defined in the 1940 Act)
of the relevant class of the respective Fund on not more than 30 days' written
notice to any other party to the Plan. Pursuant to each Plan, the Distributor
will provide the Boards of Directors/Trustees periodic reports of amounts
expended under the Plan and the purpose for which such expenditures were made.

The Directors/Trustees have determined that the Plans will benefit the
Trust, Framlington, the Company and their respective shareholders by (i)
providing an incentive for broker or bank personnel to provide continuous
shareholder servicing after the time of sale; (ii) retaining existing accounts;
(iii) facilitating portfolio management flexibility through continued cash flow
into the Funds; and (iv) maintaining a competitive sales structure in the mutual
fund industry.

With respect to Class B and Class C Shares of each Fund, the Distributor
expects to pay sales commissions to dealers authorized to sell a Fund's Class B
and Class C Shares at the time of sale. The Distributor will use its own funds
(which may be borrowed) to pay such commissions pending reimbursement by the
relevant Plan. In addition, the Advisor may use its own resources to make
payments to the Distributor or dealers authorized to sell the Funds' shares to
support their sales efforts.

36
<PAGE>

Fees paid to the Distributor Pursuant to Class A Service Plans for the last
three fiscal years.

<TABLE>
<CAPTION>
FISCAL YEAR FISCAL YEAR FISCAL YEAR
ENDED ENDED ENDED
6/30/97 6/30/98 6/30/99
-------------------------------------------
<S> <C> <C> <C>
Funds of the Trust

Balanced Fund $ 981 $ 1,274 $
Bond Fund $ 2,203 $ 2,735 $
Cash Investment Fund $ 0 $269,773 $
Growth & Income Fund $ 5,324 $ 14,520 $
Index 500 Fund $ 48,763 $140,154 $
Intermediate Bond Fund $ 13,919 $ 17,654 $
International Equity Fund $ 13,505 $ 15,618 $
Michigan Bond Fund $ 1,206 $ 2,067 $
Small Company Growth Fund $ 17,843 $ 59,251 $
Tax-Free Bond Fund $ 1,206 $ 7,966 $
Tax-Free Short-Intermediate Bond $ 14,678 $ 17,556 $
Fund
Tax-Free Money Market Fund $ 0 $154,996 $
U.S. Income Fund $ 0 $ 6,581 $
U.S. Treasury Money Market Fund $ 0 $ 18,269 $

Funds of the Company

Equity Selection Fund N/A N/A $
Growth Opportunities Fund N/A $ 0+ $
International Bond Fund $ 39* $ 400 $
Micro -Cap Fund $ 79* $ 14,218 $
Money Market Fund $ 1,198* $ 31,560 $
Multi-Season Fund $ 30,811 $ 55,691 $
NetNet Fund N/A $ 2,066 $
Real Estate Fund $ 1,559 $ 6,769 $
Short Term Treasury Fund N/A $ 11++ $
Small-Cap Value Fund $ 558* $ 10,714 $
Value Fund $ 2,347 $ 10,919 $

Funds of Framlington

Emerging Markets Fund $ 285 $ 1,804 $
Global Financial Services Fund N/A $ 0 $
Healthcare Fund $ 241 $ 7,066 $
International Growth Fund $ 759 $ 3,287 $
</TABLE>

____________________________________

* Figures reflect period from commencement of operations through June 30,
1997.
+ As of June 30, 1998, the Growth Opportunities Fund and the Global Financial
Services Fund had not commenced selling of Class A Shares.
++ As of June 2, 1998, Class A Shares of Short Term Treasury Fund were closed
to all investments.

37
<PAGE>

Fees paid to the Distributor Pursuant to Class B Service and Distribution Plans
for the last three fiscal years.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED FISCAL YEAR ENDED FISCAL YEAR ENDED
JUNE 30, 1997 JUNE 30, 1998 JUNE 30, 1999

DISTRIBUTION DISTRIBUTION DISTRIBUTION
AND SERVICE AND SERVICE AND SERVICE
FEES CDSC'S FEES CDSCS FEES CDSCS
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Funds of the Trust

Balanced Fund $ 1,249 $ 0.00 $ 3,890 $ 1,004 $ $
Bond Fund $ 5,482 $ 447.26 $ 6,329 $ 245 $ $
Growth & Income Fund $ 3,519 $ 535.41 $ 10,447 $ 2,013 $ $
Index 500 Fund $153,426 $ 0.00 $421,479 $51,363 $ $
Intermediate Bond Fund $ 2,627 $ 0.00 $ 5,683 $ 1,556 $ $
International Equity Fund $ 10,398 $ 318.86 $ 11,221 $ 2,246 $ $
Michigan Bond Fund $ 2,779 $ 0.00 $ 4,234 $ 27 $ $
Small Company Growth $21, 679 $ 930.13 $107,506 $ 6,931 $ $
Fund
Tax-Free Bond Fund $ 566 $ 0.00 $ 3,552 $ 50 $ $
Tax-Free Short- $ 1,782 $ 0.00 $ 3,575 $ 0 $ $
Intermediate Bond Fund
U.S. Income Fund $ 13,452 $ 0.00 $ 12,408 $ 1 $ $

Funds of the Company

Equity Selection Fund N/A N/A N/A N/A $ $
Growth Opportunities Fund N/A N/A $ 0*** $ 0 $ $
International Bond Fund $ 11* $ 0.00 $ 401 $ 0 $ $
Micro-Cap Fund $ 513* $ 0.00 $ 81,387 $18,345 $ $
Money Market Fund $ 1,925 $ 711.20 $ 7,836 $ 2,888 $ $
Multi-Season Fund $ 27,446 $ 0.00 $942,437 $57,921 $ $
NetNet Fund N/A N/A $ 1,359** $ 0 $ $
Real Estate Fund $731,958 $26,020.64 $ 63,758 $ 6,409 $ $
Short Term Treasury Fund $ 116* $ 0.00 $ 1,848** $ 92 $ $
Small-Cap Value Fund $ 648* $ 0.00 $ 15,054 $ 590 $ $
Value Fund $ 2,689 $ 0.00 $ 15,819 $ 129 $ $

Funds Of Framlington

Emerging Markets Fund $ 95* $ 0.00 $ 4,169 $ 1,670 $ $
Global Financial Services N/A N/A $ 0*** $ 0 $ $
Fund
Healthcare Fund $ 1,240* $ 0.00 $ 42,842 $ 7,556 $ $
International Growth Fund $ 175* $ 0.00 $ 2,170 $ 190 $ $
</TABLE>

_____________________________________

* Figures reflect period from commencement of operations through June 30,
1997.
** Figures reflect period from commencement of operations through June 30,
1998.
*** As of June 30, 1998, the Growth Opportunities Fund and the Global Financial
Services Fund had not commenced selling of Class B Shares. As of June 2,
1998, Class B Shares of Short Term Treasury Fund were closed to all
investments.

38
<PAGE>

Fees Paid to the Distributor Pursuant to Class C Service and Distribution Plans
for the last three fiscal years.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED FISCAL YEAR ENDED FISCAL YEAR ENDED
JUNE 30, 1997 JUNE 30, 1998 JUNE 30, 1999

DISTRIBUTION DISTRIBUTION DISTRIBUTION
AND SERVICE AND SERVICE AND SERVICE
FEES CDSC's FEES CDSC's FEES CDSC's
--------------------------------------------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Funds of the Trust

Balanced Fund $ 337 $ 0.00 $ 880 $ 29 $ $
Bond Fund $ 787 $ 0.00 $ 1,545 $ 862 $ $
Growth & Income Fund $ 2,683 $ 0.00 $ 7,781 $ 67 $ $
Index 500 Fund N/A N/A N/A N/A $ $
Intermediate Bond Fund $ 1,136 $ 0.00 $ 1,584 $ 7,747 $ $
International Equity Fund $18,452 $ 0.00 $ 23,594 $11,988 $ $
Michigan Bond Fund $ 568 $ 0.00 $ 747 $ 0 $ $
Small Company Growth $13,938 $212.00 $ 51,322 $13,088 $ $
Fund
Tax-Free Bond Fund N/A* N/A $ 396 $ 0 $ $
Tax-Free Short- N/A* N/A N/A*** N/A*** $ $
Intermediate Bond
Fund
U.S. Income Fund $ 93 $ 0.00 $ 268 $ 35 $ $

Funds of the Company

Equity Selection Fund N/A N/A N/A N/A $ $
Growth Opportunities N/A N/A $ 0*** $ 0 $ $
Fund
International Bond Fund N/A* N/A $ 2 $ 0 $ $
Micro-Cap Fund $ 48** $ 0.00 $ 42,988 $24,200 $ $
Money Market Fund $ 5,932 $ 0.00 $ 13,170 $ 3 $ $
Multi-Season Fund $73,808 $391.84 $112,333 $ 556 $ $
NetNet Fund N/A N/A N/A*** N/A $ $
Real Estate Fund $1, 829 $ 2.38 $ 10,810 $ 261 $ $
Short Term Treasury Fund N/A* N/A $ 159*** $ 10 $ $
Small-Cap Value Fund $ 223** $ 0.00 $ 9,109 $ 159 $ $
Value Fund $ 4,397 $ 0.00 $ 8,593 $ 23 $ $

Funds of Framlington

Emerging Markets Fund $ 49** $ 0.00 $ 448 $ 0 $ $
Global Financial Services $ 0*** $ 0 $ $
Fund
Healthcare Fund $ 125** $ 0.00 $ 20,953 $ 474 $ $
International Growth Fund $ 63** $ 0.00 $ 1,303 $ 142 $ $
</TABLE>

___________________________________

* As of June 30, 1997, the following funds had not commenced selling Class C
Shares: Tax-Free Bond Fund, Tax-Free Short-Intermediate Bond Fund,
International Bond Fund and Short Term Treasury Fund.
** Figures reflect period from commencement of operations through June 30,
1997.
*** As of June 30, 1998, the Growth Opportunities Fund, the Index 500 Fund, the
NetNet Fund and the Global Financial Services Fund had not commenced
selling Class C shares. As of June 2, 1998, Class C Shares of Short Term
Treasury were closed to all investments.

39
<PAGE>

The following amounts were paid by each Fund under its Class B Service and
Distribution Plans during the fiscal year ended June 30, 1999.

<TABLE>
<CAPTION>
Printing and
Mailing of Interest
Prospectuses to Carrying or
other than Compensation other
Current Compensation Compensation to Sales Financing
Advertising Shareholders to Underwriters to Dealers Personnel Charges
----------- ------------ --------------- ---------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Funds of the Trust

Balanced Fund $ $ $ $ $ $
Bond Fund $ $ $ $ $ $
Growth & Income Fund $ $ $ $ $ $
Index 500 Fund $ $ $ $ $ $
Intermediate Bond Fund $ $ $ $ $ $
International Equity $ $ $ $ $ $
Fund
Michigan Bond Fund $ $ $ $ $ $
Small Company Growth $ $ $ $ $ $
Fund
Tax-Free Bond Fund $ $ $ $ $ $
Tax-Free Short- $ $ $ $ $ $
Intermediate Bond
Fund
U.S. Income Fund $ $ $ $ $ $

Funds of the Company

Equity Selection Fund
Growth Opportunities $ $ $ $ $ $
Fund
International Bond Fund $ $ $ $ $ $
Micro-Cap Fund $ $ $ $ $ $
Money Market Fund $ $ $ $ $ $
Multi-Season Fund $ $ $ $ $ $
NetNet Fund $ $ $ $ $ $
Real Estate Fund $ $ $ $ $ $
Small-Cap Value Fund $ $ $ $ $ $
Value Fund $ $ $ $ $ $

Funds of Framlington

Emerging Markets Fund $ $ $ $ $ $
Global Financial $ $ $ $ $ $
Services Fund
Healthcare Fund $ $ $ $ $ $
International Growth $ $ $ $ $ $
Fund
</TABLE>

40
<PAGE>

The following amounts were paid by each Fund under its Class B Service and
Distribution Plans during the fiscal year ended June 30, 1999.

<TABLE>
<CAPTION>
Printing and
Mailing of Interest
Prospectuses Carrying or
to other than Compensation Compensation other
Current to Compensation to Sales Financing
Advertising Shareholders Underwriters to Dealers Personnel Charges
----------- ------------ ------------ ---------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Funds of the Trust

Balanced Fund $ $ $ $ $ $
Bond Fund $ $ $ $ $ $
Growth & Income Fund $ $ $ $ $ $
Index 500 Fund $ $ $ $ $ $
Intermediate Bond Fund $ $ $ $ $ $
International Equity Fund $ $ $ $ $ $
Michigan Bond Fund $ $ $ $ $ $
Small Company Growth $ $ $ $ $ $
Fund
Tax-Free Bond Fund $ $ $ $ $ $
Tax-Free Short-Intermediate $ $ $ $ $ $
Bond Fund
U.S. Income Fund $ $ $ $ $ $

Funds of the Company

Equity Selection Fund
Growth Opportunities Fund $ $ $ $ $ $
International Bond Fund $ $ $ $ $ $
Micro-Cap Fund $ $ $ $ $ $
Money Market Fund $ $ $ $ $ $
Multi-Season Fund $ $ $ $ $ $
NetNet Fund* $ $ $ $ $ $
Real Estate Equity $ $ $ $ $ $
Investment Fund $ $ $ $ $ $
Small-Cap Value Fund $ $ $ $ $ $
Value Fund $ $ $ $ $ $

Funds oF Framlington

Emerging Markets Fund $ $ $ $ $ $
Global Financial Services $ $ $ $ $ $
Fund
Healthcare Fund $ $ $ $ $ $
International Growth Fund $ $ $ $ $ $
</TABLE>

Shareholder Servicing Arrangements - Class K Shares. As stated in each
Fund's Prospectus, Class K Shares are sold to investors through institutions
which enter into Shareholder Servicing Agreements with the Trust, Framlington or
the Company to provide support services to their Customers who beneficially own
Class K Shares in consideration of the Funds' payment of not more than 0.25% (on
an annualized basis) of the average daily net assets of the Class K Shares
beneficially owned by the Customers.

41
<PAGE>

Services provided by institutions under their service agreements may
include: (i) aggregating and processing purchase and redemption requests for
Class K Shares from Customers and placing net purchase and redemption orders
with the Distributor; (ii) providing Customers with a service that invests the
assets of their accounts in Class K Shares pursuant to specific or pre-
authorized instructions; (iii) processing dividend payments on behalf of
Customers; (iv) providing information periodically to Customers showing their
positions in Class K Shares; (v) arranging for bank wires; (vi) responding to
Customer inquiries relating to the services performed by the institutions; (vii)
providing subaccounting with respect to Class K Shares beneficially owned by
Customers or the information necessary for subaccounting; (viii) if required by
law, forwarding shareholder communications from the Trust, Framlington or the
Company (such as proxies, shareholder reports, annual and semi-annual financial
statements and dividend, distribution and tax notices) to Customers; (ix)
forwarding to Customers proxy statements and proxies containing any proposals
regarding the Trust's, Framlington's or the Company's arrangements with
institutions; and (x) providing such other similar services as the Trust,
Framlington or the Company may reasonably request to the extent the institutions
are permitted to do so under applicable statutes, rules and regulations.

Pursuant to the Trust's, Framlington's and the Company's agreements with
such institutions, the Boards of Directors/Trustees will review, at least
quarterly, a written report of the amounts expended under Trust's, Framlington's
and the Company's agreements with institutions and the purposes for which the
expenditures were made. In addition, the arrangements with institutions must be
approved annually by a majority of the Boards of Directors/Trustees, including a
majority of the Directors/Trustees who are not "interested persons" as defined
in the 1940 Act, and have no direct or indirect financial interest in such
arrangements.

The Boards of Directors/Trustees have approved the arrangements with
institutions based on information provided by the service contractors that there
is a reasonable likelihood that the arrangements will benefit the Funds and
their shareholders by affording the Funds greater flexibility in connection with
the servicing of the accounts of the beneficial owners of their shares in an
efficient manner.

Administrator. State Street Bank and Trust Company ("State Street" or the
"Administrator"), whose principal business address is 225 Franklin Street,
Boston, Massachusetts, 02110, serves as administrator for the Trust, Framlington
and the Company pursuant to administration agreements (each, an "Administration
Agreement"). State Street has agreed to maintain office facilities for the
Trust, Framlington and the Company; oversee the computation of each Fund's net
asset value, net income and realized capital gains, if any; furnish statistical
and research data, clerical services, and stationery and office supplies;
prepare and file various reports with the appropriate regulatory agencies; and
prepare various materials required by the SEC. State Street may enter into an
agreement with one or more third parties pursuant to which such third parties
will provide administrative services on behalf of the Funds.

Each Administration Agreement provides that the Administrator performing
services thereunder shall not be liable under the Agreement except for its bad
faith, negligence or willful misconduct in the performance of its duties and
obligations thereunder.

Prior to November 1, 1997, First Data Investor Services Group, Inc.
("Investor Services Group") located at 53 State Street, Boston, Massachusetts
02109 served as administrator to the Funds.

For the fiscal year ended June 30, 1997, the administration fees of
Investor Services Group accrued were: Balanced Fund - $77,364; Growth & Income
Fund - $248,644; Index 500 Fund - $405,016; International Equity Fund -$259,162;
Small Company Growth Fund - $283,755; Bond Fund - $169,932; Intermediate Bond
Fund - $577,425; U.S. Income Fund - $265,637; Michigan Bond Fund - $41,620; Tax-
Free Bond Fund - $227,508; Tax-Free Short-Intermediate Bond Fund - $358,214;
Cash Investment Fund - $1,115,110; Tax-Free Money Market Fund -$283,803;
$480,310-Multi-Season Fund; $39,493-Real Estate Fund, $169,405-Money Market
Fund, $61,224-Value Fund and U.S. Treasury Money Market Fund - $355,592,
respectively.

For the period from commencement of operations through June 30, 1997,
administration fees of Investor Services Group accrued were $9,644 - Emerging
Markets Fund; $9,644 - Healthcare Fund, $9,644 - International

42
<PAGE>

Growth Fund, $730- Micro-Cap Fund; $14,220 - Small-Cap Value Fund; $32,343 -
International Bond Fund and $23,349 - Short Term Treasury Fund.

For the period July 1, 1997 through October 31, 1997, administration fees
to Investor Services Group accrued were: $14,689 for Balanced Fund, $29,146 for
Bond Fund, $184,587 for Cash Investment Fund, $47,089 for Growth & Income Fund,
$109,244 for Index 500 Fund, $95,635 for Intermediate Bond Fund, $42,940 for
International Equity Fund, $8,786 for Michigan Bond Fund, $68,964 for Small
Company Growth Fund, $37,599 for Tax-Free Bond Fund, $56,420 for Tax-Free Short-
Intermediate Bond Fund, $53,524 for Tax-Free Money Market Fund, $49,187 for U.S.
Income Fund, $39,194 for U.S. Treasury Money Market Fund, $9,604 for
International Bond Fund, $2,199 for Micro-Cap Fund, $23,555 for Money Market
Fund, $104,045 for Multi-Season Fund, $631 for NetNet Fund, $12,483 for Real
Estate Fund, $10,358 for Short Term Treasury Fund, $19,515 for Small Cap Value
Fund, $20,603 for Value Fund, $6,740 for International Growth Fund, $6,740 for
Emerging Markets Fund, and $6,740 for Healthcare Fund.

For the period November 1, 1997 through June 30, 1998, administration fees
of State Street accrued were: $27,469 for Balanced Fund, $86,722 for Bond Fund,
$374,880 for Cash Investment Fund, $85,474 for Growth & Income Fund, $235,148
for Index 500 Fund, $193,688 for Intermediate Bond Fund, $70,559 for
International Equity Fund, $18,511 for Michigan Bond Fund, $142,877 for Small
Company Growth Fund, $68,797 for Tax-Free Bond Fund, $104,833 for Tax-Free
Short-Intermediate Bond Fund, $106,996 for Tax-Free Money Market Fund, $95,641
for U.S. Income Fund, $32,072 for U.S. Treasury Money Market Fund, $16,884 for
International Bond Fund, $13,505 for Micro-Cap Fund, $36,373 for Money Market
Fund, $240,139 for Multi-Season Fund, $2,614 for NetNet Fund, $30,617 for Real
Estate Fund, $18,052 for Short Term Treasury Fund, $51,728 for Small Cap Value
Fund, $54,313 for Value Fund, $13 for Growth Opportunities Fund, $19,511 for
International Growth Fund, $16,445 for Emerging Markets Fund, $5,819 for
Healthcare Fund, and $15 for Global Financial Services Fund.

For the fiscal year ended June 30, 1999, administration fees of State
Street accrued were:

Custodian. State Street serves as the custodian (the "Custodian") to the
Funds pursuant to custodian agreements (each, a "Custodian Contract") between
State Street and the Company, the Trust and Framlington, respectively. State
Street is also the custodian with respect to the custody of foreign securities
held by the Funds. State Street has in turn entered into additional agreements
with financial institutions located in foreign countries with respect to the
custody of such securities. Under the Custodian Contracts, State Street (i)
maintains a separate account in the name of each Fund, (ii) holds and transfers
portfolio securities on account of each Fund, (iii) accepts receipts and makes
disbursements of money on behalf of each Fund, (iv) collects and receives all
income and other payments and distributions on account of each Fund's securities
and (v) makes periodic reports to the Boards of Directors/Trustees concerning
the Funds' operations.

Transfer and Dividend Disbursing Agent. Investor Services Group serves as
the transfer and dividend disbursing agent for the Funds pursuant to transfer
agency agreements with the Trust, Framlington and the Company, respectively,
under which Investor Services Group (i) issues and redeems shares of each Fund,
(ii) addresses and mails all communications by each Fund to its record owners,
including reports to shareholders, dividend and distribution notices and proxy
materials for its meetings of shareholders, (iii) maintains shareholder
accounts, (iv) responds to correspondence by shareholders of the Funds and (v)
makes periodic reports to the Boards Directors/Trustees concerning the
operations of each Fund.

Banking Laws. As stated in the Funds' Class K Shares Prospectus, Class K
Shares of the Funds are sold to customers of banks and other institutions. Such
banks and institutions may include Comerica Incorporated (a publicly-held bank
holding company), its affiliates and subsidiaries ("Comerica") and other
institutions that have entered into agreements with the Company, the Trust and
Framlington providing for shareholder services for their customers.

Banking laws and regulations currently 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

43
<PAGE>

shares, and prohibit banks generally from underwriting securities, but such
banking laws and regulations do not prohibit such a holding company or affiliate
or banks generally from acting as investment advisor, administrator, transfer
agent or custodian to such an investment company, or from purchasing shares of
such a company as agent for and upon the order of customers. The Advisor,
[World] and State Street are subject to such banking laws and regulations.

The Advisor, [World] and State Street believe they may perform the services
for the Trust, Framlington and the Company contemplated by their respective
agreements with each of them without violation of applicable banking laws and
regulations. It should be noted, however, that there have been no cases deciding
whether bank and non-bank subsidiaries of a registered bank holding company may
perform services comparable to those that are to be performed by these
companies, and future changes in either Federal or state statutes and
regulations relating to permissible activities of banks and their subsidiaries
or affiliates, as well as future judicial or administrative decisions or
interpretations of current and future statutes and regulations, could prevent
these companies from continuing to perform certain services for the Funds.

Should future legislative, judicial or administrative action prohibit or
restrict the activities of such companies in connection with the provision of
services on behalf of the Trust, Framlington or the Company, the Trust,
Framlington or the Company might be required to alter materially or discontinue
the arrangements with the institutions and change the method of operations. It
is not anticipated, however, that any change in the Funds' method of operations
would affect the net asset value per share of the Funds or result in a financial
loss to any shareholder of the Funds.

It should be noted that future changes in either Federal or state statutes
and regulations relating to permissible activities of banks and their
subsidiaries or affiliates, as well as future judicial or administrative
decisions or interpretations of current and future statutes and regulations,
could prevent Comerica and certain other institutions from continuing to perform
certain services for Class K shares of the Funds.

Should future legislative, judicial or administrative action prohibit or
restrict the activities of Comerica and/or other institutions in connection with
the provision of services on behalf of Class K shares of the Funds, the Trust,
Framlington or the Company might be required to alter materially or discontinue
the arrangements with the institutions and change the method of operations with
respect to Comerica and certain other institutions. It is not anticipated,
however, that any change in the Funds' method of operations would affect the net
asset value per share of the Funds or result in a financial loss to any holder
of Class K shares of the Funds.

Other Information Pertaining to Administration, Custodian and Transfer
Agency Agreements. Except as noted in this SAI the Funds' service contractors
bear all expenses in connection with the performance of their services and the
Funds bear the expenses incurred in their operations. These expenses include,
but are not limited to, fees paid to the Advisor, World, Sub-Advisor,
Administrator, Custodian and Transfer Agent; fees and expenses of officers and
Boards of Directors/Trustees; taxes; interest; legal and auditing fees;
brokerage fees and commissions; certain fees and expenses in registering and
qualifying the Fund and its shares for distribution under Federal and state
securities laws; expenses of preparing prospectuses and statements of additional
information and of printing and distributing prospectuses and statements of
additional information to existing shareholders; the expense of reports to
shareholders, shareholders' meetings and proxy solicitations; fidelity bond and
directors' and officers' liability insurance premiums; and the expense of using
independent pricing services. Any general expenses of the Trust, Framlington or
the Company that are not readily identifiable as belonging to a particular
investment portfolio of the Trust, Framlington or the Company are allocated
among all investment portfolios of the Trust, Framlington or the Company by or
under the direction of the Boards of Directors/Trustees in a manner that the
Boards determine to be fair and equitable. The Advisor, World, Sub-Advisor,
Administrator, Custodian and Transfer Agent may voluntarily waive all or a
portion of their respective fees from time to time.

44
<PAGE>

PORTFOLIO TRANSACTIONS

Subject to the general supervision of the Boards of Directors/Trustees, the
Advisor, World or the Sub-Advisor, as the case may be, makes decisions with
respect to and places orders for all purchases and sales of portfolio securities
for the Funds.

Transactions on U.S. stock exchanges involve the payment of negotiated
brokerage commissions. On exchanges on which commissions are negotiated, the
cost of transactions may vary among different brokers. Transactions on foreign
stock exchanges involve payment for brokerage commissions which are generally
fixed.

Over-the-counter issues, including corporate debt and government
securities, are normally traded through dealers on a "net" basis (i.e., without
commission), or directly with the issuer. With respect to over-the-counter
transactions, the Advisor, World or the Sub-Advisor, as the case may be, will
normally deal directly with dealers who make a market in the instruments except
in those circumstances where more favorable prices and execution are available
elsewhere. The cost of foreign and domestic securities purchased from
underwriters includes an underwriting commission or concession, and the prices
at which securities are purchased from and sold to dealers include a dealer's
mark-up or mark-down.

The Funds may participate, if and when practicable, in bidding for the
purchase of portfolio securities directly from an issuer in order to take
advantage of the lower purchase price available to members of a bidding group.
The Funds will engage in this practice, however, only when the Advisor, World or
the Sub-Advisor, as the case may be, believes such practice to be in the Funds'
interests.

Since the Money Market Funds will invest only in short-term debt
instruments, their annual portfolio turnover rates will be relatively high, but
brokerage commissions are normally not paid on money market instruments, and
portfolio turnover is not expected to have a material effect on the net
investment income of a Money Market Fund. The portfolio turnover rate of a Fund
is calculated by dividing the lesser of a Fund's annual sales or purchases of
portfolio securities (exclusive of purchases or sales of securities whose
maturities at the time of acquisition were thirteen months or less for the Money
Market Funds or one year or less for the Equity and Bond Funds) by the monthly
average value of the securities held by the Fund during the year. The Funds may
engage in short-term trading to achieve their investment objectives. Portfolio
turnover may vary greatly from year to year as well as within a particular year.

[Each Fund's portfolio turnover rate is included in the prospectuses under
the section entitled "Financial Highlights." For the fiscal year ended June 30,
1999, the portfolio turnover rate for the Bond Fund and the Intermediate Bond
Fund was _____% and ______%, respectively. The portfolio turnover of the Bond
Fund and the Intermediate Bond Fund was affected by fluctuating interest rate
conditions which at times required increased dispositions and acquisitions of
securities to maintain each Fund's maturity structure.]

In its Advisory Agreements, the Advisor and World and, in the case of the
Framlington Funds, the Sub-Advisor pursuant to the Sub-Advisory Agreement each
agree to select broker-dealers in accordance with guidelines established by the
Boards of Directors/Trustees from time to time and in accordance with applicable
law. In assessing the terms available for any transaction, the Advisor, World or
the Sub-Advisor, as the case may be, shall consider all factors it deems
relevant, including the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker-dealer,
and the reasonableness of the commission, if any, both for the specific
transaction and on a continuing basis. In addition, the Advisory and Sub-
Advisory Agreements authorize the Advisor, World or the Sub-Advisor, as the case
may be, subject to the prior approval of the Boards of Directors/Trustees, to
cause the Funds 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, World or
the Sub-Advisor, as the case may be, determines in good faith that such
commission is reasonable in relation to 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, World or
the Sub-Advisor to the Funds. Such brokerage and research services might consist
of reports and statistics

45
<PAGE>

on specific companies or industries, general summaries of groups of bonds and
their comparative earnings and yields, or broad overviews of the securities
markets and the economy.

Supplementary research information so received is in addition to, and not
in lieu of, services required to be performed by the Advisor, World or the Sub-
Advisor, as the case may be, and does not reduce the advisory fees payable to
the Advisor, World or the Sub-Advisor by the Funds. It is possible that certain
of the supplementary research or other services received will primarily benefit
one or more other investment companies or other accounts for which investment
discretion is exercised. Conversely, a Fund may be the primary beneficiary of
the research or services received as a result of portfolio transactions effected
for such other account or investment company.

The table below shows information on brokerage commissions paid by the
Funds. For the fiscal year ended June 30, 1997:

<TABLE>
<CAPTION>
% of Brokerage Commission
$ Amount Brokerage Representing $ Amount of Transactions
Commission Research Services Involving Research Services
---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Balanced Fund $ 57,518 30.47% $ 17,526
Growth & Income Fund $386,237 21.02% $ 81,184
Index 500 Fund $ 71,050 0.00% $ 0
International Equity Fund $101,527 0.00% $ 0
Small Company Growth Fund $852,094 3.72% $ 31,719
Micro-Cap Fund* $ 8,813 3.85% $ 339
Multi-Season Fund $366,341 31.40% $115,038
Real Estate Fund $ 3,649 2.96% $ 108
Small Cap Value Fund* $ 67,889 7.81% $ 5,304
Value Fund* $ 83,242 11.04% $ 9,192
International Growth Fund* $232,163 28.39% $ 65,918
Emerging Markets Fund* $ 87,174 1.09% $ 946
Healthcare Fund* $ 36,584 1.29% $ 472
Short Term Treasury Fund* $ 2,012 11.28% $ 227
- ------------------------
</TABLE>

*For the period from commencement of operations through June 30, 1997

The table below shows information on brokerage commissions paid by the
Funds. For the fiscal year ended June 30, 1998:

<TABLE>
<CAPTION>
% of Brokerage Commission
$ Amount Brokerage Representing Research $ Amount of Transactions
Commission Services Involving Research Services

------------------------------------------------------------------------------------
<S> <C> <C> <C>
Balanced Fund $ 73,143 6.55% $ 4,793
Growth & Income Fund $ 431,055 11.01% $47,460
Index 500 Fund $ 41,022 0.00% $ 0
International Equity Fund $ 135,364 0.00% $ 0
Small Company Growth Fund $1,860,600 1.68% $31,342
Micro-Cap Fund $ 599,304 1.26% $ 7,561
Multi-Season Fund $ 566,155 9.80% $55,508
NetNet Fund $ 86,894 0.00% $ 0
Real Estate Fund $ 102,670 0.00% $ 0
Small Cap Value Fund $ 437,217 3.27% $14,300
Value Fund $ 557,514 3.27% $18,204
Growth Opportunities Fund* $ 2,152 0.00% $ 0
International Growth Fund $ 252,419 6.84% $17,273
Emerging Markets Fund $ 430,410 1.46% $ 6,274
Healthcare Fund $ 20,464 5.97% $ 1,221
Global Financial Services Fund* $ 3,342 0.00% $ 0
- -------------------------
</TABLE>

*For the period from commencement of operations through June 30, 1998

46
<PAGE>

The table below shows information on brokerage commissions paid by the
Funds. For the fiscal year ended June 30, 1999:

<TABLE>
<CAPTION>
% of Brokerage Commission
$ Amount Brokerage Representing Research $ Amount of Transactions
Commission Services Involving Research Services
--------------------------------------------------------------------------------------
<S> <C> <C> <C>
Balanced Fund $ % $
Growth & Income Fund $ % $
Index 500 Fund $ % $
International Equity Fund $ % $
Small Company Growth Fund $ % $
Micro-Cap Fund $ % $
Multi-Season Fund $ % $
NetNet Fund $ % $
Real Estate Fund $ % $
Small Cap Value Fund $ % $
Value Fund $ % $
Growth Opportunities Fund $ % $
International Growth Fund $ % $
Emerging Markets Fund $ % $
Healthcare Fund $ % $
Global Financial Services Fund $ % $
</TABLE>

Portfolio securities will not be purchased from or sold to the Advisor,
World, Sub-Advisor, Distributor or any affiliated person (as defined in the 1940
Act) of the foregoing entities except to the extent permitted by SEC exemptive
order or by applicable law.

Investment decisions for each Fund and for other investment accounts
managed by the Advisor, World or the Sub-Advisor are made independently of each
other in the light of differing conditions. However, the same investment
decision may be made for two or more of such accounts. In such cases,
simultaneous transactions are inevitable. Purchases or sales are then averaged
as to price and allocated as to amount in a manner deemed equitable to each such
account. While in some cases this practice could have a detrimental effect on
the price or value of the security as far as a Fund is concerned, in other cases
it is believed to be beneficial to a Fund. To the extent permitted by law, the
Advisor, World or the Sub-Advisor, as the case may be, may aggregate the
securities to be sold or purchased for a Fund with those to be sold or purchased
for other investment companies or accounts in executing transactions.

A Fund will not purchase securities while the Advisor, World, the Sub-
Advisor or any affiliated person (as defined in the 1940 Act) is a member of any
underwriting or selling group for such securities except pursuant to procedures
adopted by the Trust's or Framlington Board of Trustees or the Company's Board
of Directors in accordance with Rule 10f-3 under the 1940 Act.

The Trust, the Company and Framlington are required to identify the
securities of their regular brokers or dealers (as defined in Rule 10b-1 under
the 1940) Act or their parent companies held by them as of the close of their
most recent fiscal year and state the value of such holdings. As of June 30,
1999, the ______Fund held securities of _______ valued at $_______

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

Purchases. As described in the Prospectuses, shares of the Funds may be
purchased in a number of different ways. Such alternative sales arrangements
permit an investor to choose the method of purchasing shares that is most
beneficial depending on the amount of the purchase, the length of time the
investor expects to hold shares and other relevant circumstances. An investor
may place orders directly through the Transfer Agent or the Distributor or
through arrangements with his/her authorized broker.

47
<PAGE>

Applicable Sales Charge and Dealer Reallowances- Class A Shares. As
described in the Prospectuses for the Funds, you must pay a sales charge at the
time of purchase of Class A Shares. The sales charge as a percentage of your
investment decreases as the amount you invest increases. The current sales
charge rates and commissions paid to selected dealers are as follows:

<TABLE>
<CAPTION>
EQUITY FUNDS Sales Charge
As a Percentage of Dealer reallowance
------------------ aS a Percentage
Your Investment Net Asset Value of the 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)**
</TABLE>
__________________________
* No initial sales charge applies on investments of $1 million or more.
However, a CDSC of 1% is imposed on certain redemptions within one year of
purchase. Class A Shares of the Trust Funds purchased on or before June 27,
1995 are subject to a different CDSC, which is described in the SAI.

** The Distributor will pay a 1% commission to dealers who initiate and are
responsible for purchases of $1 million or more.

Income Funds

<TABLE>
<CAPTION>
Sales Charge as a Percentage of Discount to Selected
------------------------------- Dealers as a Percentage
Your Investment Net Asset Value of Investment
--------------- --------------- -------------
<S> <C> <C> <C>
Less than $100,000.......................... 4.00% 4.17% 3.75%
$100,000 but less than $250,000............. 3.00% 3.09% 2.75%
$250,000 but less than $500,000............. 2.00% 2.04% 1.75%
$500,000 but less than $1,000,000........... 1.25% 1.27% 1.00%
$1,000,000 or more.......................... None* None* (see below)**

</TABLE>
____________________
* No initial sales charge applies on investments of $1 million or more.
However, a CDSC of 1% is imposed on certain redemptions within one year of
purchase. Class A Shares of the Trust Funds purchased on or before June 27,
1995 are subject to a different CDSC, which is described in the SAI.
** The Distributor will pay 1% commission to dealers who initiate and are
responsible for purchases of $1 million or more.

Index 500 Fund

Sales Charge Discount to
as a Percentage of Selected Dealers
------------------- as a Percentage of
Your Investment Net Asset Value Investment
--------------- --------------- ----------
<S> <C> <C> <C>
Less than $100,000....................... 2.50% 2.56% 2.25%
$100,000 but less than $250,000.......... 2.00% 2.04% 1.75%
$250,000 but less than $500,000.......... 1.50% 1.52% 1.25%
$500,000 but less than $1,000,000........ 1.00% 1.01% .75%
$1,000,000 but less than $3,000,000...... None* None* .10%
$3,000,000 but less than $5,000,000...... None* None* .05%
$5,000,000 or............................ None* None* None
more....................................
</TABLE>
__________________

* There is no initial sales charge on purchases of $1 million or more of Class
A Shares of the Fund; however, a CDSC in the amount of the Discount to Selected
Dealers shown above will be imposed on the lower of the original purchase price
or the net asset value of the shares at the time of redemption if such shares
are redeemed within one year after the date of purchase.

48
<PAGE>

The Distributor may pay the entire commission to dealers. If that occurs,
the dealer may be considered an "underwriter" under Federal securities laws.

Retirement Plans. Shares of any of the Funds may be purchased in connection
with various types of tax deferred retirement plans, including individual
retirement accounts ("IRAs"), qualified plans, deferred compensation for public
schools and charitable organizations (403(b) plans) and simplified employee
pension IRAs. An individual or organization considering the establishment of a
retirement plan should consult with an attorney and/or an accountant with
respect to the terms and tax aspects of the plan. [A $10.00 annual custodial fee
is also charged on IRAs.] This custodial fee is due by December 15 of each year
and may be paid by check or shares liquidated from a shareholder's account.

Redemptions. The redemption price for Fund shares is the net asset value
next determined after receipt of the redemption request in proper order. The
redemption proceeds will be reduced by the amount of any applicable contingent
deferred sales charge ("CDSC").

Contingent Deferred Sales Charge - Class B Shares. Class B Shares redeemed
within six years of purchase are subject to a CDSC. The CDSC is based on the
original net asset value at the time of investment or the net asset value at the
time of redemption, whichever is lower.

The CDSC Schedule for Class B Shares of the Trust Funds purchased before
June 27, 1995 is set forth below. The Prospectuses describe the CDSC Schedule
for Class B Shares of Funds of the Trust, the Company and Framlington purchased
after June 27, 1995.

Class B Shares of the Trust Funds
Purchased on or Before June 27, 1995

<TABLE>
<CAPTION>
Redemption During CDSC
- --------------------------------------------------------------------------------------------------
<S> <C>
1/st/ Year Since Purchase............................................................. 4.00%
2/nd/ Year Since Purchase............................................................. 4.00%
3/rd/ Year Since Purchase............................................................. 3.00%
4/th/ Year Since Purchase............................................................. 3.00%
5/th/ Year Since Purchase............................................................. 2.00%
6th Year Since Purchase............................................................... 1.00%
</TABLE>

CDSC Waivers - Class B Shares of the Trust Funds Purchased on or Before
June 27, 1995. The CDSC will be waived with respect to Class B Shares of the
Trust Funds purchased on or before June 27, 1995 in the following circumstances:

(1) total or partial redemptions made within one year following the death
or disability of a shareholder or registered joint owner;

(2) minimum required distributions made in connection with an IRA or other
retirement plan following attainment of age 59 1/2; and

(3) redemptions pursuant to a Fund's right to liquidate a shareholder's
account involuntarily.

CDSC Waivers - Class B Shares of the Company Funds Purchased on or before
June 27, 1995. The CDSC will be waived on the following types of redemptions
with respect to Class B Shares of the Company Funds purchased on or before June
27, 1995:

(1) redemptions by investors who have invested a lump sum amount of $1
million or more in the Fund;

(2) redemptions by the officers, directors, and employees of the Advisor
or the Distributor and such persons' immediate families;

49
<PAGE>

(3) dealers or brokers who have a sales agreement with the Distributor,
for their own accounts, or for retirement plans for their employees or
sold to registered representatives or 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) involuntary redemptions effected pursuant to the Fund's right to
liquidate shareholder accounts having an aggregate net asset value of
less than $250; and

(5) redemptions the proceeds of which are reinvested in the Fund within 90
days of the redemption.

Contingent Deferred Sales Charge - Class A and Class C Shares. The
Prospectuses describe the CDSC for Class A or C Shares of the Funds of the
Trust, the Company and Framlington purchased after June 27, 1995.

Class A Shares of the Trust Funds purchased on or before June 27, 1995
without a sales charge by reason of a purchase of $500,000 or more are subject
to a CDSC of 1.00% of the lower of the original purchase price or the net asset
value at the time of redemption if such shares are redeemed within two years of
the date of purchase. Class A Shares of the Trust Funds purchased on or before
June 27, 1995 that are redeemed will not be subject to the CDSC to the extent
that the value of such shares represents: (1) reinvestment of dividends or other
distributions; (2) Class A Shares redeemed more than two years after their
purchase; (3) a minimum required distribution made in connection with IRA or
other retirement plans following attainment of age 59 1/2; or (4) total or
partial redemptions made within one year following the death or disability of a
shareholder or registered joint owner.

No CDSC is imposed to the extent that the current net asset value of the
shares redeemed does not exceed (a) the current net asset value of shares
purchased through reinvestment of dividends or capital gain distributions plus
(b) the current net asset value of shares purchased more than one year prior to
the redemption, plus (c) increases in the net asset value of the shareholder's
shares above the purchase payments made during the preceding one year.

The holding period of Class A or Class C Shares of a Fund acquired through
an exchange of the corresponding class of shares of the Munder Money Market Fund
(which are available only by exchange of Class A or Class C Shares of the Fund,
as the case may be) and the Company Funds, the Framlington Funds and the non-
money market funds of the Trust will be calculated from the date that the Class
A or Class C Shares of the Fund were initially purchased.

In determining whether a CDSC is applicable to a redemption, the
calculation will be made in a manner that results in the lowest possible rate.
It will be assumed that the redemption is made first of amounts representing all
Class A Shares on which a front-end sales charge has been assessed; then of
shares acquired pursuant to the reinvestment of dividends and distributions; and
then of amounts representing the cost of shares purchased one year or more prior
to the redemption.

Other Redemption Information. Redemption proceeds are normally paid in
cash; however, each Fund may pay the redemption price in whole or part by a
distribution in kind of securities from the portfolio of the particular Fund, in
lieu of cash, in conformity with applicable rules of the SEC. If shares are
redeemed in kind, the redeeming shareholder might incur transaction costs in
converting the assets into cash. The Funds are obligated to redeem shares solely
in cash up to the lesser of $250,000 or 1% of its net assets during any 90-day
period for any one shareholder.

The Funds reserve the right to suspend or postpone redemptions during any
period when: (i) trading on the New York Stock Exchange (the "NYSE") is
restricted by applicable rules and regulations of the SEC; (ii) the NYSE is
closed other than for customary weekend and holiday closings; (iii) the SEC has
by order permitted such suspension or postponement for the protection of the
shareholders; or (iv) an emergency, as determined by the SEC, exists, making
disposal of portfolio securities or valuation of net assets of a Fund not
reasonably practicable.

The Funds may involuntarily redeem an investor's shares if the net asset
value of such shares is less than $250; provided that involuntary redemptions
will not result from fluctuations in the value of an investor's shares. A notice
of redemption, sent by first-class mail to the investor's address of record,
will fix a date not less than 30 days

50
<PAGE>

after the mailing date, and shares will be redeemed at the net asset value at
the close of business on that date unless sufficient additional shares are
purchased to bring the aggregate account value up to $250 or more. A check for
the redemption proceeds payable to the investor will be mailed to the investor
at the address of record.

Exchanges. In addition to the method of exchanging shares described in the
Funds' Prospectuses, a shareholder exchanging at least $1,000 of shares (for
which certificates have not been issued) and who has authorized expedited
exchanges on the application form filed with the Transfer Agent may exchange
shares by telephoning the Funds at (800) 438-5789. Telephone exchange
instructions must be received by the Transfer Agent by 4:00 p.m., Eastern time.
The Funds, Distributor and Transfer Agent reserve the right at any time to
suspend or terminate the expedited exchange procedure or to impose a fee for
this service. During periods of unusual economic or market changes, shareholders
may experience difficulties or delays in effecting telephone exchanges. Neither
the Funds nor the Transfer Agent will be responsible for any loss, damages,
expense or cost arising out of any telephone exchanges effected upon
instructions believed by them to be genuine. The Transfer Agent has instituted
procedures that it believes are reasonably designed to insure that exchange
instructions communicated by telephone are genuine, and could be liable for
losses caused by unauthorized or fraudulent instructions in the absence of such
procedures. The procedures currently include a recorded verification of the
shareholder's name, social security number and account number, followed by the
mailing of a statement confirming the transaction, which is sent to the address
of record.

NET ASSET VALUE

Money Market Funds. The value of the portfolio securities of the Money
Market Funds is calculated using the amortized cost method of valuation. Under
this method the market value of an instrument is approximated by amortizing the
difference between the acquisition cost and value at maturity of the instrument
on a straight-line basis over the remaining life of the instrument. The effect
of changes in the market value of a security as a result of fluctuating interest
rates is not taken into account. The market value of debt securities usually
reflects yields generally available on securities of similar quality. When such
yields decline, market values can be expected to increase, and when yields
increase, market values can be expected to decline.

As indicated, the amortized cost method of valuation may result in the
value of a security being higher or lower than its market price, the price a
Fund would receive if the security were sold prior to maturity. The Boards of
Directors/Trustees have established procedures reasonably designed, taking into
account current market conditions and the Funds' investment objectives, for the
purpose of maintaining a stable net asset value of $1.00 per share for each
Money Market Fund for purposes of sales and redemptions. These procedures
include a review by the Boards of Directors/Trustees, at such intervals as they
deem appropriate, of the extent of any deviation of net asset value per share,
based on available market quotations, from the $1.00 amortized cost per share.
Should that deviation exceed 1/2 of 1% for a Fund, the Boards of
Directors/Trustees will promptly consider whether any and, if any, what action
should be initiated. If the Board believes that the extent of any deviation from
a Money Market Fund's $1.00 amortized cost price per share may result in
material dilution of other unfair results to new or existing investors, it will
take such steps as it considers appropriate to eliminate or reduce any such
dilution or unfair results to the extent reasonably practicable. Such action may
include redeeming shares in kind, selling portfolio securities prior to
maturity, reducing or withholding dividends, shortening the average portfolio
maturity, reducing the number of outstanding shares without monetary
consideration, and utilizing a net asset value per share as determined by using
available market quotations.

Pursuant to Rule 2a-7 under the 1940 Act, each of the Money Market Funds
will maintain a dollar-weighted average portfolio maturity appropriate to its
objective of maintaining a stable net asset value per share, provided that such
Funds will not purchase any security with a remaining maturity (within the
meaning of Rule 2a-7 under the 1940 Act) greater than 397 days (securities
subject to repurchase agreements, variable and floating rate securities, and
certain other securities may bear longer maturities), nor maintain a dollar-
weighted average portfolio maturity which exceeds 90 days. In addition, the
Funds may acquire only U.S. dollar denominated obligations that present minimal
credit risks and that are "First Tier Securities" at the time of investment.
First Tier Securities are those that are rated in the highest rating category by
at least two nationally recognized security rating organizations NRSROs or by
one if it is the only NRSRO rating such obligation or, if unrated, determined to
be of comparable

51
<PAGE>

quality. A security is deemed to be rated if the issuer has any security
outstanding of comparable priority and security which has received a short-term
rating by an NRSRO. The Advisor will determine that an obligation presents
minimal credit risks or that unrated investments are of comparable quality, in
accordance with guidelines established by the Board of Directors/Trustees. There
can be no assurance that a constant net asset value will be maintained for each
Money Market Fund.

All Funds. [Securities traded on a national securities exchange or on
NASDAQ for which there were no sales on the date of valuation and securities
traded on other over-the-counter markets, including listed securities for which
the primary market is believed to be over-the-counter, are valued at the mean
between the most recently quoted bid and asked prices. Options will be valued at
market value or fair value if no market exists. Futures contracts will be valued
in like manner, except that open futures contract sales will be valued using the
closing settlement price or, in the absence of such a price, the most recently
quoted asked price. Restricted securities and securities and assets for which
market quotations are not readily available are valued at fair value by the
Advisor under the supervision of the Boards of Directors/Trustees. Debt
securities with remaining maturities of 60 days or less are valued at amortized
cost, unless the Boards of Directors/Trustees determines that such valuation
does not constitute fair value at that time. Under this method, such securities
are valued initially at cost on the date of purchase (or the 61st day before
maturity).] In determining the approximate market value of portfolio
investments, the Trust, Framlington or the Company may employ outside
organizations, which may use matrix or formula methods that take into
consideration market indices, matrices, yield curves and other specific
adjustments. This may result in the securities being valued at a price different
from the price that would have been determined had the matrix or formula methods
not been used. All cash, receivables and current payables are carried on the
Trust's, Framlington's or the Company's books at their face value. Other assets,
if any, are valued at fair value as determined in good faith under the
supervision of the Board members.

In-Kind Purchases

With the exception of the Real Estate Fund, payment for shares may, in the
discretion of the Advisor, World or the Sub-Advisor, be made in the form of
securities that are permissible investments for the Funds as described in the
Prospectuses. Shares of the Real Estate Fund will not be issued for
consideration other than cash. For further information about this form of
payment please contact the Transfer Agent. In connection with an in-kind
securities payment, a Fund will require, among other things, that the securities
(a) meet the investment objectives and policies of the Fund; (b) are acquired
for investment and not for resale; (c) are liquid securities that are not
restricted as to transfer either by law or liquidity of markets; (d) have a
value that is readily ascertainable by a listing on a nationally recognized
securities exchange; and (e) are valued on the day of purchase in accordance
with the pricing methods used by the Fund and that the Fund receive satisfactory
assurances that (i) it will have good and marketable title to the securities
received by it; (ii) that the securities are in proper form for transfer to the
Fund; and (iii) adequate information will be provided concerning the basis and
other tax matters relating to the securities.

PERFORMANCE INFORMATION

Yield of the Money Market Funds

The Money Market Funds' current and effective yields are computed using
standardized methods required by the SEC. The annualized yield is computed by:
(a) determining the net change in the value of a hypothetical account having a
balance of one share at the beginning of a seven-calendar day period; (b)
dividing the net change by the value of the account at the beginning of the
period to obtain the base period return; and (c) annualizing the results (i.e.,
multiplying the base period return by 365/7). The net change in the value of the
account reflects the value of additional shares purchased with dividends
declared and all dividends declared on both the original share and such
additional shares, but does not include realized gains and losses or unrealized
appreciation and depreciation. Compound effective yields are computed by adding
1 to the base period return (calculated as described above), raising the sum to
a power equal to 365/7 and subtracting 1. Based on the foregoing computations,
the table below shows the annualized yields for all share classes of the Cash
Investment, Money

52
<PAGE>

Market, Tax-Free Money Market and U.S. Treasury Money Market Funds for the
seven-day period ended June 30, 1999.

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
CLASS A Class B Class C Class K Class Y
- ---------------------------------------------------------------------------------------------------------------------------
Effective Effective Effective Effective Effective
Yield Yield Yield Yield Yield Yield Yield Yield Yield Yield
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Cash Investment % % % % % % % % % %
Fund
- ---------------------------------------------------------------------------------------------------------------------------
Money Market % % % % % % % % % %
Fund
- ---------------------------------------------------------------------------------------------------------------------------
Tax-Free Money % % % % % % % % % %
Market Fund
- ---------------------------------------------------------------------------------------------------------------------------
U.S. Treasury % % % % % % % % % %
Money Market
Fund
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>

In addition, a standardized "tax-equivalent yield" may be quoted for the
Tax-Free Money Market Fund, which is computed by: (a) dividing the portion of
the Fund's yield (as calculated above) that is exempt from Federal income tax by
1 minus a stated Federal income tax rate; and (b) adding the figure resulting
from (a) above to that portion, if any, of the yield that is not exempt from
Federal income tax. For the seven-day period ended June 30, 1999, the tax-
equivalent yield for Class A, Class K and Class Y Shares of the Tax-Free Money
Market Fund was ___% (Class A), ____% (Class K) and ____% (Class Y) calculated
for all share classes based on a stated tax rate of 31%. The fees which may be
imposed by institutions on their Customers are not reflected in the calculations
of yields for the Funds.

Yield may fluctuate daily and does not provide a basis for determining
future yields. Because the yields of each Fund will fluctuate, they cannot be
compared with yields on savings accounts or other investment alternatives that
provide an agreed to or guaranteed fixed yield for a stated period of time.
However, yield information may be useful to an investor considering temporary
investments in money market instruments. In comparing the yield of one money
market fund to another, consideration should be given to each Fund's investment
policies including the types of investments made, lengths of maturities of the
portfolio securities, and whether there are any special account charges which
may reduce the effective yield.

Performance of the Non-Money Market Funds

Yield. The Bond Funds', International Bond Fund's and Short Term Treasury
Fund's 30-day (or one month) standard yield described in the applicable
Prospectus is calculated for each Fund in accordance with the method prescribed
by the SEC for mutual funds:

YIELD = 2 [( a-b + 1)6 - 1]
---
cd
Where:
a =dividends and interest earned by a Fund during the period;
b =expenses accrued for the period (net of reimbursements and waivers);
c =average daily number of shares outstanding during the period entitled to
receive dividends;
d =maximum offering price per share on the last day of the period.

For the purpose of determining interest earned on debt obligations
purchased by a Fund at a discount or premium (variable "a" in the formula), each
Fund computes the yield to maturity of such instrument based on the market value
of the obligation (including actual accrued interest) at the close of business
on the last business day of each month, or, with respect to obligations
purchased during the month, the purchase price (plus actual accrued interest).
Such yield is then divided by 360 and the quotient is multiplied by the market
value of the obligation (including actual accrued interest) in order to
determine the interest income on the obligation for each day of the subsequent
month that the obligation is in the portfolio. It is assumed in the above
calculation that each month

53
<PAGE>

contains 30 days. The maturity of a debt obligation with a call provision is
deemed to be the next call date on which the obligation reasonably may be
expected to be called or, if none, the maturity date. For the purpose of
computing yield on equity securities held by a Fund, dividend income is
recognized by accruing 1/360 of the stated dividend rate of the security for
each day that the security is held by the Fund.

Interest earned on tax-exempt obligations that are issued without original
issue discount and that have a current market discount is calculated by using
the coupon rate of interest instead of the yield to maturity. In the case of
tax-exempt obligations that are issued with original issue discount but which
have discounts based on current market value that exceed the then-remaining
portion of the original issue discount (market discount), the yield to maturity
is the imputed rate based on the original issue discount calculation. On the
other hand, in the case of tax-exempt obligations that are issued with original
issue discount but which have the discounts based on current market value that
are less than the then-remaining portion of the original issue discount (market
premium), the yield to maturity is based on the market value.

With respect to mortgage- or other receivables-backed debt obligations
purchased at a discount or premium, the formula generally calls for amortization
of the discount or premium. The amortization schedule will be adjusted monthly
to reflect changes in the market value of such debt obligations. Expenses
accrued for the period (variable "b" in the formula) include all recurring fees
charged by a Fund to all shareholder accounts in proportion to the length of the
base period and the Fund's mean (or median) account size. Undeclared earned
income will be subtracted from the offering price per share (variable "d" in the
formula). A Fund's maximum offering price per share for purposes of the formula
includes the maximum sales charge imposed -- currently 5.50% of the per share
offering price for Class A Shares of the Equity Funds (with the exception of the
Index 500 Fund, currently 2.50% of the per share offering price for Class A) and
the Balanced Fund and 4.00% of the per share offering price for Class A Shares
of the Bond Fund, International Bond Fund, Short Term Treasury Fund and Tax-Free
Bond Funds. The tax-equivalent yield for each Tax-Free Bond Fund below is based
on a stated federal tax rate of 31% and, with respect to Michigan Bond Fund, a
Michigan state tax rate of 4%.

Class A Shares
- --------------

The standard yields and/or tax-equivalent yields of the Class A Shares of
the following Funds for the 30-day period ended June 30, 1999 were:

<TABLE>
<CAPTION>
30-Day Yield Tax-Equivalent 30-Day Yield
------------ ---------------------------
<S> <C> <C>
Bond Fund % %
Intermediate Bond Fund % %
U.S. Income Fund % %
International Bond Fund % %
Michigan Bond Fund % %
Tax-Free Bond Fund % %
Tax-Free Short-Intermediate Bond Fund % %
</TABLE>

Class B Shares
- --------------

The standard yields and/or tax-equivalent yields of the Class B Shares of
the following Funds for the 30-day period ended June 30, 1999 were:

54
<PAGE>

Class C Shares
- --------------

The standard yields and/or tax-equivalent yields of the Class C Shares of
the following Funds for the 30-day period ended June 30, 1999 were:

Class K Shares
- --------------

The standard yields and/or tax-equivalent yields of the Class K Shares of
the following Funds for the 30-day period ended June 30, 1999 were:

Michigan Municipal Shares
- -------------------------

The standard yields and/or tax-equivalent yields of the Michigan Municipal
Shares of the Short Term Treasury Fund for the 30-day period ended June 30, 1999
were:

<TABLE>
<CAPTION>
30-Day Yield Tax-Equivalent 30-Day Yield
------------ ---------------------------
<S> <C> <C>
Short Term Treasury Fund % %
</TABLE>

Class Y Shares
- --------------

The standard yields and/or tax-equivalent yields of the Class Y Shares of
the following Funds for the 30-day period ended June 30, 1999 were:

<TABLE>
<CAPTION>
30-Day Yield Tax-Equivalent 30-Day Yield
------------ ---------------------------
<S> <C> <C>
Bond Fund % %
Intermediate Bond Fund % %
U.S. Income Fund % %
International Bond Fund % %
Short Term Treasury Fund % %
Michigan Bond Fund % %
Tax-Free Bond Fund % %
Tax-Free Short-Intermediate Bond Fund % %
</TABLE>

Total Return. Each Fund that advertises its "average annual total return"
computes such return by determining the average annual compounded rate of return
during specified periods that equates the initial amount invested to the ending
redeemable value of such investment according to the following formula:

P (1 + T)/n/ = ERV
Where:
P = hypothetical initial payment of $1,000;

55
<PAGE>

T = average annual total return;

n = period covered by the computation, expressed in years; and

ERV = ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the 1, 5 or 10 year (or other) periods at the end of the
applicable period (or a fractional portion thereof).

Each Fund that advertises its "aggregate total return" computes such
returns by determining the aggregate compounded rates of return during specified
periods that likewise equate the initial amount invested to the ending
redeemable value of such investment. The formula for calculating aggregate total
return is as follows:

(ERV) - 1
-----
Aggregate Total Return = P

The calculations are made assuming that (1) all dividends and capital gain
distributions are reinvested on the reinvestment dates at the price per share
existing on the reinvestment date, (2) all recurring fees charged to all
shareholder accounts are included, and (3) for any account fees that vary with
the size of the account, a mean (or median) account size in the Fund during the
periods is reflected. The ending redeemable value (variable "ERV" in the
formula) is determined by assuming complete redemption of the hypothetical
investment after deduction of all non-recurring charges at the end of the
measuring period. The Funds' average annual total return and load adjusted
aggregate total return quotations for Class A Shares will reflect the deduction
of the maximum sales charge charged in connection with the purchase of such
shares - currently 5.50% of the per share offering price for Class A Shares of
the Equity Funds (with the exception of the Index 500 Fund, currently 2.50% of
the per share offering price for Class A) and the Balanced Fund and 4.00% of the
per share offering price for Class A Shares of the Bond Fund, International Bond
Fund and Tax-Free Bond Funds; and the Funds' load adjusted average annual total
return and load adjusted aggregate total return quotations for Class B Shares
will reflect any applicable CDSC; provided that the Funds may also advertise
total return data without reflecting any applicable CDSC sales charge imposed on
the purchase of Class A Shares or Class B Shares in accordance with the views of
the SEC. Quotations which do not reflect the sales charge will, of course, be
higher than quotations which do.

Based on the foregoing calculation, set forth below are the average annual
total return figures for the Class A, B, C, K and Y Shares of each of the
following Funds for the 12 month and 5 year periods ended June 30, 1999 and
since commencement of operations.

<TABLE>

Balanced Fund
Class A-4/30/93
Class B-6/21/94
Class C-1/24/96
Class K-4/16/93
Class Y-4/13/93

Growth & Income Fund
Class A-8/8/94
Class B-8/9/94
Class C-12/5/95
Class K-7/5/94
Class Y-7/5/94
</TABLE>

56
<PAGE>

<TABLE>

International Equity
Fund
Class A-11/30/92
Class B-3/9/94
Class C-9/29/95
Class K-11/23/92
Class Y-12/1/91

Small Company Growth
Fund
Class A-11/23/92
Class B-4/28/94
Class C-9/26/95
Class K-11/23/92
Class Y-12/1/91

Bond Fund
Class A-12/9/92
Class B-3/13/96
Class C-3/25/96
Class K-11/23/92
Class Y-12/1/91

Intermediate Bond Fund
Class A-11/24/92
Class B-10/25/94
Class C-4/19/96
Class K-11/20/92
Class Y-12/1/91

US Income Fund
Class A-7/28/94
Class B-9/6/95
Class C-8/12/96
Class K-7/5/94
Class Y-7/5/94

Michigan Bond Fund
Class A-2/15/94
Class B-7/5/94
Class C-10/4/96
Class K-1/3/94
Class Y-1/3/94
</TABLE>

57
<PAGE>

<TABLE>

Tax-Free Short-
Intermediate Bond Fund
Class A-11/30/92
Class B-5/16/96
Class C-7/8/98
Class K-2/9/87++
Class Y-12/17/92

Funds of Framlington
Emerging Markets Fund
Class A-1/14/97
Class B-2/25/97
Class C-3/3/97
Class K-1/10/97
Class Y-12/31/96

Global Financial
Services Fund
Class Y -

Healthcare Fund
Class A-2/14/97
Class B-1/31/97
Class C-1/13/97
Class K-4/1/97
Class Y-12/31/96

International Growth
Fund
Class A-2/20/97
Class B-3/19/97
Class C-2/13/97
Class K-1/10/97
Class Y-12/31/96

Funds of the Company
Equity Selection Fund
Class Y - / /98

Growth Opportunities
Fund
Class Y - / /98
</TABLE>

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<PAGE>

<TABLE>

Micro-Cap Fund
Class A-12/26/96
Class B-2/24/97
Class C-3/31/97
Class K-12/31/96
Class Y-12/26/96

Multi-Season Fund
Class A-8/4/93
Class B-4/29/93
Class C-9/20/93
Class K-6/23/95
Class Y-8/16/93

NetNet Fund
Class A-8/19/96
Class B-6/1/98
Class C
Class Y-6/1/98

Short Term Treasury
Fund
Michigan Municipal
Shares-4/2/97
Class Y-1/29/97

Small-Cap Fund
Class A-1/10/97
Class B-2/11/97
Class C-1/13/97
Class K-12/31/96
Class Y-12/26/96

Real Estate Fund
Class A-9/30/94
Class B-10/3/94
Class C-1/5/96
Class K-10/3/96
Class Y-10/3/94
</TABLE>

59
<PAGE>

<TABLE>

12 Month 5 Year Inception 12 Month 5 Year Inception
Period Ended Period Ended through Period Ended Period Ended through
Fund-Inception Date 6/30/99* 6/30/99* 6/30/99* 6/30/99** 6/30/99** 6/30/99**
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Value Fund
Class A-9/14/95
Class B-9/19/95
Class C-2/9/96
Class K-11/30/95
Class Y-8/18/95
</TABLE>
____________________________________________________________
* Figures do not include the effect of the sales charge.
** Figures include the effect of the applicable sales charge.
+ As of June 15, 1998, Class K Shares of Short Term Treasury Fund were
renamed the Michigan Municipal Shares.
++ For the ten year period ended June 30, 1999, the average annual return for
Class K Shares was _____%.

As of June 30, 1999, the following Classes had not commenced operations:
Class A Shares of the Equity Selection Fund, Global Financial Services Fund and
Growth Opportunities Fund; Class B Shares of the Equity Selection Fund, Global
Financial Services Fund, Growth Opportunities Fund, Cash Investment Fund,
International Bond Fund, Tax-Free Money Market Fund and U.S. Treasury Money
Market Fund; Class C Shares of the Equity Selection Fund, Global Financial
Services Fund, Growth Opportunities Fund, Cash Investment Fund, Tax-Free Money
Market Fund, Index 500 Fund, and U.S. Treasury Money Market Fund; and Class K
Shares of the Equity Selection Fund, Global Financial Services Fund and Growth
Opportunities Fund.

The foregoing performance data reflects the imposition of the maximum sales
load on Class A Shares but does not reflect payments under the Trust's Class K
Plan or Class A Plan, which were not imposed before December 31, 1993.

All Funds. The performance of any investment is generally a function of
portfolio quality and maturity, type of investment and operating expenses.

From time to time, in advertisements or in reports to shareholders, a
Fund's yields or total returns may be quoted and compared to those of other
mutual funds with similar investment objectives and to stock or other relevant
indices. In addition, as stated in the Funds' Prospectuses, the tax-equivalent
yield (and hypothetical examples illustrating the effect of tax-equivalent
yields) of a Fund may be quoted in advertisements or reports to shareholders.
Hypothetical examples showing the difference between a taxable and a tax-free
investment may also be provided to shareholders.

TAXES

The following summarizes certain additional Federal and state income tax
considerations generally affecting the Funds and their shareholders that are not
described in the Funds' Prospectuses. No attempt is made to present a detailed
explanation of the tax treatment of the Funds or their shareholders, and the
discussion here and in the applicable Prospectus is not intended as a substitute
for careful tax planning. This discussion is based upon present provisions of
the Internal Revenue Code, the regulations promulgated thereunder, and judicial
and administrative ruling authorities, all of which are subject to change, which
change may be retroactive. Prospective investors should consult their own tax
advisors with regard to the federal tax consequences of the purchase, ownership
and disposition of Fund shares, as well as the tax consequences arising under
the laws of any state, foreign country, or other taxing jurisdiction.

General. Each Fund intends to elect and qualify to be taxed separately as a
regulated investment company under Subchapter M of the Internal Revenue Code. As
a regulated investment company, each Fund generally is exempt from Federal
income tax on its net investment income and realized capital gains which it
distributes to shareholders, provided that it distributes an amount equal to the
sum of (a) at least 90% of its investment company

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<PAGE>

taxable income (net investment income and the excess of net short-term capital
gain over net long-term capital loss), if any, for the year and (b) at least 90%
of its net tax-exempt interest income, if any, for the year (the "Distribution
Requirement") and satisfies certain other requirements of the Internal Revenue
Code that are described below. Distributions of investment company taxable
income and net tax-exempt interest income made during the taxable year or, under
specified circumstances, within twelve months after the close of the taxable
year will satisfy the Distribution Requirement.

In addition to satisfying the Distribution Requirement, each Fund must
derive with respect to a taxable year at least 90% of its gross income from
dividends, interest, certain payments with respect to securities loans and gains
from the sale or other disposition of stock or securities or foreign currencies,
or from other income derived with respect to its business of investing in such
stock, securities, or currencies (the "Income Requirement"). Interest (including
original issue discount and accrued market discount) received by a Fund at
maturity or on disposition of a security held for less than three months will
not be treated (in contrast to other income which is attributable to realized
market appreciation) as gross income from the sale or other disposition of
securities held for less than three months for this purpose.

In addition to the foregoing requirements, at the close of each quarter of
its taxable year, at least 50% of the value of each Fund's assets must consist
of cash and cash items, U.S. Government securities, securities of other
regulated investment companies, and securities of other issuers (as to which a
Fund has not invested more than 5% of the value of its total assets in
securities of such issuer and as to which a Fund does not hold more than 10% of
the outstanding voting securities of such issuer) and no more than 25% of the
value of each Fund's total assets may be invested in the securities of any one
issuer (other than U.S. Government securities and securities of other regulated
investment companies), or in two or more issuers which such Fund controls and
which are engaged in the same or similar trades or businesses.

Distributions of net investment income received by a Fund from investments
in debt securities (other than interest on tax-exempt municipal obligations held
by the Tax-Free Bond Funds and Tax-Free Money Market Fund) and any net realized
short-term capital gains distributed by a Fund will be taxable to shareholders
as ordinary income and will not be eligible for the dividends-received deduction
for corporations.

Each Fund intends to distribute to shareholders any excess of net long-term
capital gain over net short-term capital loss ("net capital gain") for each
taxable year. Such gain is distributed as a capital gain dividend and is taxable
to shareholders as gain from the sale or exchange of a capital asset held for
more than one year, regardless of the length of time a shareholder has held his
or her Fund shares and regardless of whether the distribution is paid in cash or
reinvested in shares. The Funds expect that capital gain dividends will be
taxable to shareholders as long-term gain. Capital gain dividends are not
eligible for the dividends-received deduction.

In the case of corporate shareholders, distributions of a Fund for any
taxable year generally qualify for the dividends-received deduction to the
extent of the gross amount of "qualifying dividends" received by such Fund for
the year and if certain holding period requirements are met. Generally, a
dividend will be treated as a "qualifying dividend" if it has been received from
a domestic corporation.

If for any taxable year any Fund does not qualify as a regulated investment
company, all of its taxable income will be subject to tax at regular corporate
rates without any deduction for distributions to shareholders. In such event,
all distributions (whether or not derived from exempt-interest income) would be
taxable as ordinary income and would be eligible for the dividends-received
deduction in the case of corporate shareholders to the extent of such Fund's
current and accumulated earnings and profits.

Shareholders will be advised annually as to the federal income tax
consequences of distributions made by the Funds each year.

Amounts not distributed on a timely basis in accordance with a calendar
year distribution requirement are subject to a nondeductible 4% excise tax. To
prevent imposition of the excise tax, a Fund must distribute during each
calendar year an amount equal to the sum of (1) at least 98% of its ordinary
income (not taking into account

61
<PAGE>

any capital gains or losses) for the calendar year, (2) at least 98% of its
capital gains in excess of its capital losses (adjusted for certain ordinary
losses, as prescribed by the Code) for the one-year period ending on October 31
of the calendar year, and (3) any ordinary income and capital gains for previous
years that was not distributed during those years. A distribution will be
treated as paid on December 31 of the current calendar year if it is declared by
a Fund in October, November or December with a record date in such a month and
paid by a Fund during January of the following calendar year. Such distributions
will be taxable to shareholders in the calendar year in which the distributions
are declared, rather than the calendar year in which the distributions are made.
To prevent application of the excise tax, a Fund intends to make its
distributions in accordance with the calendar year distribution requirement.

Although a Fund expects to qualify as a "regulated investment company" and to
be relieved of all or substantially all Federal income taxes, depending upon the
extent of its activities in states and localities in which its offices are
maintained, in which its agents or independent contractors are located or in
which it is otherwise deemed to be conducting business, a Fund may be subject to
the tax laws of such states or localities.

The Trust, the Framlington Trust and the Company will be required in
certain cases to withhold and remit to the United States Treasury 31% of taxable
distributions, including gross proceeds realized upon sale or other dispositions
paid to any shareholder (i) who has provided an incorrect tax identification
number or no number at all, (ii) who is subject to backup withholding by the
Internal Revenue Service for failure to report the receipt of taxable interest
or dividend income properly, or (iii) who has failed to certify that he is not
subject to backup withholding or that he is an "exempt recipient."

Disposition of Shares. Upon a redemption, sale or exchange of his or her
shares, a shareholder will realize a taxable gain or loss depending upon his or
her basis in the shares. Such gain or loss will be treated as capital gain or
loss if the shares are capital assets in the shareholder's hands and will be
long-term or short-term, generally, depending upon the shareholder's holding
period for the shares. Any loss realized on a redemption, sale or exchange will
be disallowed to the extent the shares disposed of are replaced (including
through reinvestment of dividends) within a period of 61 days beginning 30 days
before and ending 30 days after the shares are disposed of. In such a case, the
basis of the shares acquired will be adjusted to reflect the disallowed loss.
Any loss realized by a shareholder on the sale of Fund shares held by the
shareholder for six months or less will be treated as a long-term capital loss
to the extent of any distributions of net capital gains received or treated as
having been received by the shareholder with respect to such shares and treated
as long-term capital gains. Furthermore, a loss realized by a shareholder on the
redemption, sale or exchange of shares of a Fund with respect to which exempt-
interest dividends have been paid will, to the extent of such exempt-interest
dividends, be disallowed if such shares have been held by the shareholder for
six months or less.

In some cases, shareholders will not be permitted to take sales charges
into account for purposes of determining the amount of gain or loss realized on
the disposition of their stock. This prohibition generally applies where (1) the
shareholder incurs a sales charge in acquiring the stock of a Fund, (2) the
stock is disposed of before the 91st day after the date on which it was
acquired, and (3) the shareholder subsequently acquires the stock of the same or
another fund and the otherwise applicable sales charge is reduced under a
"reinvestment right" received upon the initial purchase of regulated investment
company shares. The term "reinvestment right" means any right to acquire stock
of one or more funds without the payment of a sales charge or with the payment
of a reduced sales charge. Sales charges affected by this rule are treated as if
they were incurred with respect to the stock acquired under the reinvestment
right. This provision may be applied to successive acquisitions of Fund shares.

Although each Fund expects to qualify as a "regulated investment company"
and to be relieved of all or substantially all federal income taxes, depending
upon the extent of its activities in states and localities in which its offices
are maintained, in which its agents or independent contractors are located or in
which it is otherwise deemed to be conducting business, each Fund may be subject
to the tax laws of such states or localities.

Tax-Free Bond Funds and Tax-Free Money Market Fund. The Michigan Bond Fund,
Tax-Free Bond Fund, Tax-Free Short-Intermediate Bond Fund, and Tax-Free Money
Market Fund are designed to provide investors with current tax-exempt interest
income. Shares of the Funds would not be suitable for tax-exempt institutions
and

62
<PAGE>

may not be suitable for retirement plans qualified under Section 401 of the
Code, H.R. 10 plans and individual retirement accounts since such plans and
accounts are generally tax-exempt and, therefore, not only would not gain any
additional benefit from the Funds' dividends being tax-exempt but also such
dividends would be taxable when distributed to the beneficiary. In addition, the
Funds may not be an appropriate investment for entities which are "substantial
users" of facilities financed by private activity bonds or "related persons"
thereof. "Substantial user" is defined under U.S. Treasury Regulations to
include a non-exempt person who regularly uses a part of such facilities in his
trade or business and (a) whose gross revenues derived with respect to the
facilities financed by the issuance of bonds are more than 5% of the total
revenues derived by all users of such facilities, (b) who occupies more than 5%
of the entire usable area of such facilities, or (c) for whom such facilities or
a part thereof were specifically constructed, reconstructed or acquired.
"Related persons" generally include certain related natural persons, affiliated
corporations, a partnership and its partners and an S corporation and its
shareholders.

In order for the Funds to pay exempt-interest dividends with respect to any
taxable year, at the close of each quarter of each Fund's taxable year at least
50% of the value of the Fund's assets must consist of tax-exempt municipal
obligations. Exempt-interest dividends distributed to shareholders are not
included in the shareholder's gross income for regular federal income tax
purposes. However, all shareholders required to file a federal income tax return
are required to report the receipt of exempt-interest dividends and other tax-
exempt interest on their returns. Moreover, while such dividends and interest
are exempt from regular federal income tax, they may be subject to alternative
minimum tax in two circumstances. First, exempt-interest dividends derived from
certain "private activity" bonds issued after August 7, 1986 will generally
constitute an item of tax preference for both corporate and non-corporate
taxpayers. Second, exempt-interest dividends derived from all bonds, regardless
of the date of issue, must be taken into account by corporate taxpayers in
determining the amount of certain adjustments for alternative minimum tax
purposes. Receipt of exempt-interest dividends may result in collateral federal
income tax consequences to certain other taxpayers, including financial
institutions, property and casualty insurance companies, individual recipients
of Social Security or Railroad Retirement benefits, and foreign corporations
engaged in a trade or business in the United States. Prospective investors
should consult their own tax advisors as to such consequences.

The percentage of total dividends paid by the Fund with respect to any
taxable year which qualifies as federal exempt-interest dividends will be the
same for all shareholders receiving dividends during such year. If a shareholder
receives an exempt-interest dividend with respect to any share and such share is
held for six months or less, any loss on the sale or exchange of such share will
be disallowed to the extent of the amount of such dividends.

Interest on indebtedness incurred by a shareholder to purchase or carry
shares of the Funds generally is not deductible for federal income tax purposes
if the Funds distribute exempt-interest dividends during the shareholder's
taxable year.

Investors may be subject to state and local taxes on income derived from an
investment in a Fund. In certain states, income derived from a Fund which is
attributable to interest on obligations of that state or any municipality or
political subdivision thereof may be exempt from taxation.

Shareholders are advised to consult their own tax advisers with respect to
the particular tax consequences to them of an investment in a Fund. Persons who
may be "substantial users" (or "related persons" of substantial users) of
facilities financed by industrial development bonds should consult their tax
advisers before investing in a Fund.

Michigan Tax Considerations - Michigan Bond Fund and Tax-Free Short-
Intermediate Bond Fund. As stated in the Michigan Bond Fund Prospectus and the
Tax-Free Short-Intermediate Bond Fund Prospectus, dividends paid by the Fund
that are derived from interest attributable to tax-exempt Michigan Municipal
Obligations will be exempt from Michigan Income Tax and Michigan Single Business
Tax. Conversely, to the extent that the Fund's dividends are derived from
interest on obligations other than Michigan Municipal Obligations, such
dividends will be subject to Michigan Income and Michigan Single Business Taxes,
even though the dividends may be exempt for federal Income Tax purposes.

63
<PAGE>

In particular, gross interest income and dividends derived from obligations
or securities of the State of Michigan and its political subdivisions, exempt
from federal Income Tax, are exempt from Michigan Income Tax under Act No. 281,
Public Acts of Michigan, 1967, as amended, and are exempt from Michigan Single
Business Tax under Act No. 228, Public Acts of Michigan, 1975, as amended. The
Michigan Income Tax act levies a flat-rate income tax on individuals, estates,
and trusts. The Single Business Tax Act levies a tax upon the "adjusted tax
base" of most individuals, corporations, financial organizations, partnerships,
joint ventures, estates, and trusts with "business activity" in Michigan.

The transfer of obligations or securities of the State of Michigan and its
political subdivisions by the Fund, as well as the transfer of Fund shares by a
shareholder, is subject to Michigan taxes measured by gain on the sale, payment,
or other disposition thereof.

International Equity Fund, International Growth Fund, Emerging Markets
Fund, Global Financial Services Fund and International Bond Fund. Income
received by the International Equity Fund, the International Growth Fund, the
Emerging Markets Fund, the Global Financial Services Fund and the International
Bond Fund from sources within foreign countries may be subject to withholding
and other foreign taxes. The payment of such taxes will reduce the amount of
dividends and distributions paid to the Funds' shareholders. So long as a Fund
qualifies as a regulated investment company, certain distribution requirements
are satisfied, and more than 50% of the value of the Fund's assets at the close
of the taxable year consists of securities of foreign corporations, the Fund may
elect, subject to limitation, to pass through its foreign tax credits to its
shareholders. The Fund may qualify for and make this election in some, but not
necessarily all, of its taxable years. If a Fund were to make an election, an
amount equal to the foreign income taxes paid by the Fund would be included in
the income of its shareholders and the shareholders would be entitled to credit
their portions of this amount against their U.S. tax due, if any, or to deduct
such portions from their U.S. taxable income, if any. Shortly after any year for
which it makes such an election, a Fund will report to its shareholders, in
writing, the amount per share of such foreign tax that must be included in each
shareholder's gross income and the amount which will be available for deduction
or credit. No deduction for foreign taxes may be claimed by a shareholder who
does not itemize deductions. Certain limitations are imposed on the extent to
which the credit (but not the deduction) for foreign taxes may be claimed.

Shareholders who choose to utilize a credit (rather than a deduction) for
foreign taxes will be subject to limitations, including the restriction that the
credit may not exceed the shareholder's United States tax (determined without
regard to the availability of the credit) attributable to his or her total
foreign source taxable income. For this purpose, the portion of dividends and
distributions paid by the Fund from its foreign source income will be treated as
foreign source income. The Fund's gains and losses from the sale of securities
will generally be treated as derived from United States sources and certain
foreign currency gains and losses likewise will be treated as derived from
United States sources. The limitation on the foreign tax credit is applied
separately to foreign source "passive income", such as the portion of dividends
received from the Fund which qualifies as foreign source income. In addition,
only a portion of the foreign tax credit will be allowed to offset any
alternative minimum tax imposed on corporations and individuals. Because of
these limitations, shareholders may be unable to claim a credit for the full
amount of their proportionate shares of the foreign income taxes paid by the
Fund.

Taxation of Certain Financial Instruments. Special rules govern the Federal
income tax treatment of financial instruments that may be held by some of the
Funds. These rules may have a particular impact on the amount of income or gain
that the Funds must distribute to their respective shareholders to comply with
the Distribution Requirement, on the income or gain qualifying under the Income
Requirement, all described above.

Market Discount. If a Fund purchases a debt security at a price lower than
the stated redemption price of such debt security, the excess of the stated
redemption price over the purchase price is "market discount". If the amount of
market discount is more than a de minimis amount, a portion of such market
discount must be included as ordinary income (not capital gain) by the Fund in
each taxable year in which the Fund owns an interest in such debt security and
receives a principal payment on it. In particular, the Fund will be required to
allocate that principal payment first to the portion of the market discount on
the debt security that has accrued but has not previously been includable in
income. In general, the amount of market discount that must be included for each
period is equal to the lesser of (i) the amount of market discount accruing
during such period (plus any accrued

64
<PAGE>

market discount for prior periods not previously taken into account) or (ii) the
amount of the principal payment with respect to such period. Generally, market
discount accrues on a daily basis for each day the debt security is held by a
Fund at a constant rate over the time remaining to the debt security's maturity
or, at the election of the Fund, at a constant yield to maturity which takes
into account the semi-annual compounding of interest. Gain realized on the
disposition of a market discount obligations must be recognized as ordinary
interest income (not capital gain) to the extent of the "accrued market
discount."

Original Issue Discount. Certain debt securities acquired by the Funds may
be treated as debt securities that were originally issued at a discount. Very
generally, original issue discount is defined as the difference between the
price at which a security was issued and its stated redemption price at
maturity. Although no cash income on account of such discount is actually
received by a Fund, original issue discount that accrues on a debt security in a
given year generally is treated for federal income tax purposes as interest and,
therefore, such income would be subject to the distribution requirements
applicable to regulated investment companies.

Some debt securities may be purchased by the Fund, at a discount that
exceeds the original issue discount on such debt securities, if any. This
additional discount represents market discount for federal income tax purposes
(see above).

Hedging Transactions. The taxation of equity options and over-the-counter
options on debt securities is governed by Code section 1234. Pursuant to Code
section 1234, the premium received by a Fund for selling a put or call option is
not included in income at the time of receipt. If the option expires, the
premium is short-term capital gain to the Fund. If the Fund enters into a
closing transaction, the difference between the amount paid to close out its
position and the premium received is short-term capital gain or loss. If a call
option written by a Fund is exercised, thereby requiring the Fund to sell the
underlying security, the premium will increase the amount realized upon the sale
of such security and any resulting gain or loss will be a capital gain or loss,
and will be long-term or short-term depending upon the holding period of the
security. With respect to a put or call option that is purchased by a Fund, if
the option is sold, any resulting gain or loss will be a capital gain or loss,
and will be long-term or short-term, depending upon the holding period of the
option. If the option expires, the resulting loss is a capital loss and is long-
term or short-term, depending upon the holding period of the option. If the
option is exercised, the cost of the option, in the case of a call option, is
added to the basis of the purchased security and, in the case of a put option,
reduces the amount realized on the underlying security in determining gain or
loss.

Any regulated futures and foreign currency contracts and certain options
(namely, nonequity options and dealer equity options) in which a Fund may invest
may be "Section 1256 contracts." Gains or losses on Section 1256 contracts are
generally considered 60% long-term and 40% short-term capital gains or losses;
however, foreign currency gains or losses arising from certain section 1256
contracts may be treated as ordinary income or loss. Also, Section 1256
contracts held by a Fund at the end of each taxable year (and generally for
purposes of the 4% excise tax, on October 31 of each year) are "marked to
market" with the result that unrealized gains or losses are treated as though
they were realized.

Generally, hedging transactions, if any, undertaken by a Fund may result in
"straddles" for U.S. Federal income tax purposes. The straddle rules may affect
the character of gains (or losses) realized by the Funds. In addition, losses
realized by a Fund on positions that are part of a straddle may be deferred
under the straddle rules, rather than being taken into account in calculating
the taxable income for the taxable year in which such losses are realized.
Because only a few regulations implementing the straddle rules have been
promulgated, the tax consequences of hedging transactions to the Funds are not
entirely clear. The hedging transactions may increase the amount of short-term
capital gain realized by the Funds which is taxed as ordinary income when
distributed to shareholders.

The Funds may make one or more of the elections available under the Code
which are applicable to straddles. If a Fund makes any of the elections, the
amount, character and timing of the recognition of gains or losses from the
affected straddle positions will be determined under rules that vary according
to the election(s) made. The rules applicable under certain of the elections may
operate to accelerate the recognition of gains or losses from the affected
straddle positions.

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<PAGE>

Because application of the straddle rules may affect the character of gains
or losses, and may defer losses and/or accelerate the recognition of gains or
losses from the affected straddle positions, the amount which must be
distributed to shareholders, and which will be taxed to shareholders as ordinary
income or long-term capital gain, may be more than or less than the
distributions of substantially as compared to a fund that did not engage in such
hedging transactions.

The diversification requirements applicable to the Funds' assets may limit
the extent to which the Funds will be able to engage in transactions in options,
futures or forward contracts.

Constructive Sales. Recently enacted rules may affect the timing and
character of gain if a Fund engages in transactions that reduce or eliminate its
risk of loss with respect to appreciated financial positions. If the Fund enters
into certain transactions in property while holding substantially identical
property, the Fund would be treated as if it had sold and immediately
repurchased the property and would be taxed on any gain (but not loss) from the
constructive sale. The character of gain from a constructive sale would depend
upon the Fund's holding period in the property. Loss from a constructive sale
would be recognized when the property was subsequently disposed of, and its
character would depend on the Fund's holding period and the application of
various loss deferral provisions of the Code.

Currency Fluctuations - "Section 988" Gains or Losses. Under the Code,
gains or losses attributable to fluctuations in exchange rates which occur
between the time a Fund accrues receivables or liabilities denominated in a
foreign currency and the time the Fund actually collects such receivables or
pays such liabilities generally are treated as ordinary income and loss.
Similarly, on disposition of debt securities denominated in a foreign currency
and on disposition of certain futures, forward contracts and options, gains or
losses attributable to fluctuations in the value of the foreign currency between
the date of acquisition of the security or contract and the date of disposition
also are treated as ordinary gain or loss. These gains or losses, referred to
under the Code as "Section 988" gains or losses, may increase or decrease the
amount of a Fund's investment company taxable income to be distributed to its
shareholders as ordinary income.

Passive Foreign Investment Companies. Certain Funds may invest in shares of
foreign corporations that may be classified under the Code as passive foreign
investment companies ("PFICs"). In general, a foreign corporation is classified
as a PFIC if at least on-half of its assets constitute investment-type assets,
or 75% or more of its gross income investment-type income. If a Fund receives a
so-called "excess distribution" with respect to PFIC shares, the Fund itself may
be subject to a tax on a portion of the excess distribution, whether or not the
corresponding income is distributed by the Fund to shareholders. In general,
under the PFIC rules, an excess distribution is treated as having been realized
ratably over the period during which the Fund held the PFIC shares. Each Fund
will itself be subject to tax on the portion, if any, of an excess distribution
that is so allocated to prior Fund taxable years and an interest factor will be
added to the tax, as if the tax had been payable in such prior taxable years.
Certain distributions from a PFIC as well as gain from the sale of PFIC shares
are treated as excess distributions. Excess distributions are characterized as
ordinary income even though, absent application of the PFIC rules, certain
excess distributions might have been classified as capital gain.

The Funds may be eligible to elect alternative tax treatment with respect
to PFIC shares. Under an election that currently is available in some
circumstances, a Fund generally would be required to include in its gross income
its share of the earnings of a PFIC on a current basis, regardless of whether
distributions were received from the PFIC in a given year. If this election were
made, the special rules, discussed above, relating to the taxation of excess
distributions, would not apply. In addition, another election would involve
marking to market the Fund's PFIC shares at the end of each taxable year, with
the result that unrealized gains would be treated as though they were realized
and reported as ordinary income. Any mark-to market losses and any loss from an
actual disposition of Fund shares would be deductible as ordinary losses to the
extent of any net mark-to-market gains included in income in prior years.

Income received by a Fund from sources within foreign countries may be
subject to withholding and other taxes imposed by such countries.

66
<PAGE>

Fund shareholders may be subject to state, local and foreign taxes on their
Fund distributions. In many states, Fund distributions which are derived from
interest on certain U.S. Government obligations are exempt from taxation. The
tax consequences to a foreign shareholder of an investment in the Fund may be
different from those described herein. Foreign shareholders are advised to
consult their own tax advisers with respect to the particular tax consequences
to them of an investment in the Fund. Shareholders are advised to consult their
own tax advisers with respect to the particular tax consequences to them of an
investment in the Fund.

Other Taxation

The foregoing discussion relates only to U.S. federal income tax law and
certain state taxes as applicable to U.S. persons (i.e., U.S. citizens and
residents and domestic corporations, partnerships, trusts and estates).
Distributions by the Funds, and dispositions of Fund shares also may be subject
to other state and local taxes, and their treatment under state and local income
tax laws may differ from the U.S. federal income tax treatment. Shareholders
should consult their tax advisers with respect to particular questions of U.S.
federal, state and local taxation. Shareholders who are not U.S. persons should
consult their tax advisers regarding U.S. and foreign tax consequences of
ownership of shares of the Fund, including the likelihood that distributions to
them would be subject to withholding of U.S. federal income tax at a rate of 30%
(or at a lower rate under a tax treaty). Future legislative or administrative
changes or court decisions may significantly change the conclusions expressed
herein, and any such changes or decisions may have a retroactive effect with
respect to the transactions contemplated herein.

ADDITIONAL INFORMATION CONCERNING SHARES

The Trust and Framlington are Massachusetts business trusts. Under each
Declaration of Trust, the beneficial interest in the Trust or Framlington may be
divided into an unlimited number of full and fractional transferable shares. The
Company is a Maryland corporation. The Trust's and Framlington's Declaration of
Trust and the Company's Articles of Incorporation authorize the Boards of
Directors/Trustees to classify or reclassify any unissued shares of the Trust,
Framlington and the Company into one or more classes by setting or changing, in
any one or more respects, their respective designations, preferences, conversion
or other rights, voting powers, restrictions, limitations, qualifications and
terms and conditions of redemption. Pursuant to such authority, the Trust's
Board of Trustees has authorized the issuance of an unlimited number of shares
of beneficial interest in the Trust, representing interests in the Balanced,
Growth & Income, Index 500, International Equity, Small Company Growth, Bond,
Intermediate Bond, U.S. Income, Michigan Bond, Tax-Free Bond, Tax-Free Short-
Intermediate Bond, Cash Investment, Tax-Free Money Market and U.S. Treasury
Money Market Funds. The shares of each Fund (other than the Cash Investment
Fund, Tax-Free Money Market Fund and U.S. Treasury Money Market Fund) are
offered in five separate classes: Class A, Class B, Class C, Class K and Class Y
Shares. The Cash Investment Fund, Tax-Free Money Market Fund and U.S. Treasury
Money Market Fund offer only Class A Shares, Class K Shares and Class Y Shares.
Pursuant to the authority of Framlington's Declaration of Trust, the Trustees
have authorized the issuance of an unlimited number of shares of beneficial
interest in Framlington representing interests in the International Growth Fund,
Emerging Markets Fund, Global Financial Services Fund and Healthcare Fund. The
shares of each Fund are offered in five separate classes: Class A, Class B,
Class C, Class K and Class Y Shares. Pursuant to the authority of the Company's
Articles of Incorporation, the Directors have authorized the issuance of shares
of common stock representing interests in the Equity Selection Fund, Growth
Opportunities Fund, Micro-Cap Fund, Multi-Season Fund, Real Estate Fund, Small-
Cap Value Fund, Value Fund, International Bond Fund, Money Market Fund, All-
Season Conservative Fund, All-Season Moderate Fund, All-Season Aggressive Fund,
Financial Services Fund, Short Term Treasury Fund and NetNet Fund. The shares of
each Fund (other than the Money Market Fund, All-Season Conservative Fund, All-
Season Moderate Fund, All-Season Aggressive Fund, Financial Services Fund, Short
Term Treasury Fund and the NetNet Fund) are offered in five separate classes:
Class A, Class B, Class C, Class K and Class Y Shares. The Money Market Fund
offers only Class A, Class B and Class C Shares (which may be acquired only
through an exchange of shares from the corresponding classes of other funds of
the Trust, Framlington and the Company) and Class Y Shares. The All-Season
Conservative Fund, All-Season Moderate Fund and All-Season Aggressive Fund offer
only Class A, Class B and Class Y Shares. The Short Term

67
<PAGE>

Treasury Fund offers Class Y Shares and the Michigan Municipal Shares (formerly,
Class K Shares). The NetNet Fund offers only Class A, Class B, Class C and Class
Y Shares.

The Boards of the Trust, the Company and Framlington have adopted plans
pursuant to Rule 18f-3 under the 1940 Act ("Multi-Class Plans") on behalf of
each Fund. Each Multi-Class Plan provides that shares of each class of a Fund
are identical, except for one or more expense variables, certain related rights,
exchange privileges, class designation and sales loads assessed due to differing
distribution methods.

In the event of a liquidation or dissolution of the Trust, Framlington or
the Company or an individual Fund, shareholders of a particular Fund would be
entitled to receive the assets available for distribution belonging to such
Fund, and a proportionate distribution, based upon the relative net asset values
of the Trust's, Framlington's or the Company's respective Funds, of any general
assets not belonging to any particular Fund which are available for
distribution. Shareholders of a Fund are entitled to participate in the net
distributable assets of the particular Fund involved on liquidation, based on
the number of shares of the Fund that are held by each shareholder.

Holders of all outstanding shares of a particular Fund will vote together
in the aggregate and not by class on all matters, except that only Class A
Shares of a Fund will be entitled to vote on matters submitted to a vote of
shareholders pertaining to the Fund's Class A Plan, only Class B Shares will be
entitled to vote on matters submitted to a vote of shareholders pertaining to
the Fund's Class B Plan, only Class C Shares of a Fund will be entitled to vote
on matters submitted to a vote of shareholders pertaining to the Fund's Class C
Plan, and only Class K Shares of a Fund will be entitled to vote on matters
submitted to a vote of shareholders pertaining to the Class K Plan. Further,
shareholders of all of the Funds, as well as those of any other investment
portfolio now or hereafter offered by the Trust, Framlington or the Company,
will vote together in the aggregate and not separately on a Fund-by-Fund basis,
except as otherwise required by law or when permitted by the Boards of
Directors/Trustees. Rule 18f-2 under the 1940 Act provides that any matter
required to be submitted to the holders of the outstanding voting securities of
an investment company such as the Trust, Framlington or the Company shall not be
deemed to have been effectively acted upon unless approved by the holders of a
majority of the outstanding shares of each Fund affected by the matter. A Fund
is affected by a matter, (i) unless it is clear that the interests of each Fund
in the matter are substantially identical or (ii) that the matter does not
affect any interest of the Fund. Under the Rule, the approval of an investment
advisory agreement, sub-advisory agreement or any change in a fundamental
investment policy would be effectively acted upon with respect to a Fund only if
approved by a majority of the outstanding shares of such Fund. However, the Rule
also provides that the ratification of the appointment of independent auditors,
the approval of principal underwriting contracts and the election of trustees
may be effectively acted upon by shareholders of the Trust, Framlington or the
Company voting together in the aggregate without regard to a particular Fund.

Shares of each of the Trust, Framlington and the Company have noncumulative
voting rights and, accordingly, the holders of more than 50% of each of the
Trust's, Framlington's and the Company's outstanding shares (irrespective of
class) may elect all of the trustees or directors. Shares have no preemptive
rights and only such conversion and exchange rights as the Board may grant in
its discretion. When issued for payment as described in the applicable
Prospectus, shares will be fully paid and non-assessable by each of the Trust,
Framlington and the Company.

Annual shareholder meetings to elect trustees or directors will not be held
unless and until such time as required by law. At that time, the trustees then
in office will call a shareholders' meeting to elect trustees. Except as set
forth above, the trustees will continue to hold office and may appoint successor
trustees. Meetings of the shareholders of the Trust, Framlington or the Company
shall be called by the trustees or directors upon the written request of
shareholders owning at least 10% of the outstanding shares entitled to vote.

The Trust's and Framlington's Declaration of Trust, as amended, each
authorizes the Board of Trustees, without shareholder approval (unless otherwise
required by applicable law), to: (i) sell and convey the assets belonging to a
class of shares to another management investment company for consideration which
may include securities issued by the purchaser and, in connection therewith, to
cause all outstanding shares of such class to be redeemed at a price which is
equal to their net asset value and which may be paid in cash or by distribution
of the

68
<PAGE>

securities or other consideration received from the sale and conveyance; (ii)
sell and convert the assets belonging to one or more classes of shares into
money and, in connection therewith, to cause all outstanding shares of such
class to be redeemed at their net asset value; or (iii) combine the assets
belonging to a class of shares with the assets belonging to one or more other
classes of shares if the Board of Trustees reasonably determines that such
combination will not have a material adverse effect on the shareholders of any
class participating in such combination and, in connection therewith, to cause
all outstanding shares of any such class to be redeemed or converted into shares
of another class of shares at their net asset value. However, the exercise of
such authority may be subject to certain restrictions under the 1940 Act. The
Trust's and Framlington's Board of Trustees may authorize the termination of any
class of shares after the assets belonging to such class have been distributed
to its shareholders.

OTHER INFORMATION

Counsel. The law firm of Dechert Price & Rhoads, 1775 Eye Street, N.W.,
Washington, D.C. 20006, has passed upon certain legal matters in connection with
the shares offered by the Funds and serves as counsel to the Trust, Framlington
and the Company.

Independent Accountants. Ernst & Young LLP, 200 Clarendon Street, Boston,
Massachusetts 02116, serves as the Trust's, Framlington's and the Company's
independent accountants.

Control Persons and Principal Holders of Securities. [As of September 26,
1999, Comerica Bank, One Detroit Center, 500 Woodward Ave., Detroit, Michigan
48226, held of record substantially all of the outstanding shares of the Funds
as agent or trustee for its customers. As a result, Comerica Bank will be able
to affect the outcome of matters presented for a vote of each Fund's
shareholders. As of September 26, 1999, the following persons were beneficial
owners of 5% or more of the outstanding shares of any class of a Fund because
they possessed voting or investment power with respect to such shares:]

<TABLE>
<CAPTION>
Percentage of
Total Shares
Name of Fund - Class Name and Address Outstanding
- -------------------- ---------------- -----------
<S> <C> <C>
</TABLE>

As of September 26, 1999, Munder Capital Management, on behalf of their
clients owned % of the Fund Class ___ shares.

Shareholder Approvals. As used in this SAI, a "majority of the outstanding
shares" of a Fund or investment portfolio means the lesser of (a) 67% of the
shares of the particular Fund or portfolio represented at a meeting at which the
holders of more than 50% of the outstanding shares of such Fund or portfolio are
present in person or by proxy, or (b) more than 50% of the outstanding shares of
such Fund or portfolio.

REGISTRATION STATEMENT

This SAI and each of the Fund's Prospectuses do not contain all the information
included in the Fund's registration statement filed with the SEC under the 1933
Act with respect to the securities offered hereby, certain portions of which
have been omitted pursuant to the rules and regulations of the SEC. The
registration statement, including the exhibits filed therewith, may be examined
at the offices of the SEC in Washington, D.C. Text-only versions of fund
documents can be viewed online or downloaded from the SEC at
http:/www.sec.gov.

Statements contained herein and in each of the Fund's Prospectuses as to
the contents of any contract or other documents referred to are not necessarily
complete, and, in such instance, reference is made to the copy of such contract
or other documents filed as an exhibit to the Fund's registration statement,
each such statement being qualified in all respects by such reference.

69
<PAGE>

FINANCIAL STATEMENTS

[The financial statements for the Trust, Framlington and the Company
including the notes thereto, dated June 30, 1999 have been audited by Ernst &
Young LLP and are incorporated by reference into this SAI from the Annual
Reports of the Trust, Framlington and the Company dated as of June 30, 1999. The
information under the caption "Financial Highlights" of the Funds for the period
from commencement of operations through June 30, 1999, appearing in the related
Prospectuses dated October 26, 1999 has been derived from the financial
statements audited by Ernst & Young LLP [except for periods ended prior to June
30, 1995 for the Multi-Season Fund and Money Market Fund,] which have been
derived from the financial statements audited by other independent auditors.
Such financial statements and financial highlights are included or incorporated
by reference herein in reliance upon their reports given upon the authority of
such firms as experts in accounting and auditing.]

70
<PAGE>

APPENDIX A
----------

- Rated Investments -
Corporate Bonds
- ---------------

From MOODY'S INVESTORS SERVICES, INC. ("MOODY'S") description of its bond
ratings:

"Aaa":

Bonds that are rated "Aaa" are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred
to as "gilt edged." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be
visualized are most unlikely to impair the fundamentally strong position
of such issues.

"Aa":

Bonds that are rated "Aa" are judged to be of high-quality by all
standards. Together with the "Aaa" group they comprise what are generally
known as "high-grade" bonds. They are rated lower than the best bonds
because margins of protection may not be as large as in "Aaa" securities
or fluctuation of protective elements may be of greater amplitude or
there may be other elements present which make the long-term risks appear
somewhat larger than in "Aaa" securities.

"A":

Bonds that are rated "A" possess many favorable investment attributes
and are to be considered as upper-medium-grade obligations. Factors
giving security to principal and interest are considered adequate, but
elements may be present which suggest a susceptibility to impairment
sometime in the future.

"Baa":

Bonds that are rated "Baa" are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding
investment characteristics and in fact have speculative characteristics
as well.

"Ba":

Bonds that are rated "Ba" are judged to have speculative elements;
their future cannot be considered well assured. Often the protection of
interest and principal payments may be very moderate and thereby not well
safeguarded during both good and bad times over the future. Uncertainty
of position characterizes bonds in this class.

"B":

Bonds that are rated "B" generally lack characteristics of desirable
investments. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time
may be small.

"Caa":

Bonds that are rated "Caa" are of poor standing. These issues may be
in default or present elements of danger may exist with respect to
principal or interest.

Moody's applies numerical modifiers (1, 2 and 3) with respect to bonds
rated "Aa" through "B". The modifier 1 indicates that the bond being rated ranks
in the higher end of its generic rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates that the bond ranks in the lower
end of its generic rating category.

A-1
<PAGE>

From Standard & Poor's Corporation ("S&P") description of its bond ratings:

"AAA":

Debt rated "AAA" has the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.

"AA":

Debt rated "AA" has a very strong capacity to pay interest and repay
principal and differs from "AAA" issues by a small degree.

"A":

Debt rated "A" has a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse effects
of changes in circumstances and economic conditions than debt in higher
rated categories.

"BBB":

Bonds rated "BBB" are regarded as having an adequate capacity to pay
interest and principal. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are
more likely to lead to a weakened capacity to pay interest and repay
principal for bonds in this category than for bonds in higher rated
categories.

"BB," "B" and "CCC":

Bonds rated "BB" and "B" are regarded, on balance, as predominantly
speculative with respect to capacity to pay interest and principal in
accordance with the terms of the obligations. "BB" represents a lower
degree of speculation than "B" and "CCC" the highest degree of
speculation. While such bonds will likely have some quality and
protective characteristics, these are outweighed by large uncertainties
or major risk exposures to adverse conditions.

To provide more detailed indications of credit quality, the "AA" or "A"
ratings may be modified by the addition of a plus or minus sign to show relative
standing within these major rating categories.

Commercial Paper
- ----------------

The rating "Prime-1" is the highest commercial paper rating assigned by
Moody'S. These issuers (or related supporting institutions) are considered to
have a superior capacity for repayment of short-term promissory obligations.
instruments rated "Prime-2" are offered by issuers (or related supporting
institutions) which have a strong capacity for repayment of short-term
promissory obligations. This will normally be evidenced by many of the
characteristics of "Prime-1" rated issues, but to a lesser degree. Earnings
trends and coverage ratios, while sound, will be more susceptible to variation.
Capitalization characteristics, while still appropriate, may be more affected by
external conditions. Ample alternate liquidity is maintained.

Commercial paper ratings of S&P are current assessments of the likelihood
of timely payment of debt having original maturities of no more than 365 days.
Commercial paper rated "A-1" by S&P indicates that the degree of safety
regarding timely payment is either overwhelming or very strong. Those issues
determined to possess overwhelming safety characteristics are denoted "A-1+."
Commercial paper rated "A-2" by S&P indicates that capacity for timely payment
is strong. However, the relative degree of safety is not as high as for issues
designated "A-1."

Rated commercial paper purchased by a Fund must have (at the time of
purchase) the highest quality rating assigned to short-term debt securities or,
if not rated, or rated by only one agency, are determined to be of comparative
quality pursuant to guidelines approved by a Fund's Boards of Trustees and
Directors.

A-2
<PAGE>

APPENDIX B

The Equity Funds, the Balanced Fund and the Bond Funds may enter into
certain futures transactions and options for hedging purposes. Each of the
Equity Funds, Balanced Fund, Bond Funds, International Bond Fund and Tax-Free
Bond Funds (other than Tax-Free Short-Intermediate Bond Fund) may also write
covered call options, buy put options, buy call options and write secured put
options. Such transactions are described in this Appendix.

I. Interest Rate Futures Contracts
-------------------------------

Use of Interest Rate Futures Contracts. Bond prices are established in
---------------------------------------
both the cash market and the futures market. In the cash market, bonds are
purchased and sold with payment for the full purchase price of the bond being
made in cash, generally within five business days after the trade. In the
futures market, only a contract is made to purchase or sell a bond in the future
for a set price on a certain date. Historically, the prices for bonds
established in the futures markets have tended to move generally in the
aggregate in concert with the cash market prices and have maintained fairly
predictable relationships. Accordingly, the Funds may use interest rate futures
contracts as a defense, or hedge, against anticipated interest rate changes and
not for speculation. As described below, this would include the use of futures
contract sales to protect against expected increases in interest rates and
futures contract purchases to offset the impact of interest rate declines.

The Funds presently could accomplish a similar result to that which it
hopes to achieve through the use of futures contracts by selling bonds with long
maturities and investing in bonds with short maturities when interest rates are
expected to increase, or conversely, selling short-term bonds and investing in
long-term bonds when interest rates are expected to decline. However, because of
the liquidity that is often available in the futures market, the protection is
more likely to be achieved, perhaps at a lower cost and without changing the
rate of interest being earned by the Funds, through using futures contracts.

Description of Interest Rate Futures Contracts. An interest rate futures
-----------------------------------------------
contract sale would create an obligation by a Fund, as seller, to deliver the
specific type of financial instrument called for in the contract at a specific
future time for a specified price. A futures contract purchase would create an
obligation by the Fund, as purchaser, to take delivery of the specific type of
financial instrument at a specific future time at a specific price. The specific
securities delivered or taken, respectively, at settlement date, would not be
determined until or at near that date. The determination would be in accordance
with the rules of the exchange on which the futures contract sale or purchase
was made.

Although interest rate futures contracts by their terms call for actual
delivery or acceptance of securities, in most cases the contracts are closed out
before the settlement date without making or taking of delivery of securities.
Closing out a futures contract sale is effected by the Fund's entering into a
futures contract purchase for the same aggregate amount of the specific type of
financial instrument and the same delivery date. If the price of the sale
exceeds the price of the offsetting purchase, the Fund is immediately paid the
difference and thus realizes a gain. If the offsetting purchase price exceeds
the sale price, the Fund pays the difference and realizes a loss. Similarly, the
closing out of a futures contract purchase is effected by the Fund entering into
a futures contract sale. If the offsetting sale price exceeds the purchase
price, the Fund realizes a gain, and if the purchase price exceeds the
offsetting sale price, the Fund realizes a loss.

Interest rate futures contracts are traded in an auction environment on the
floors of several exchanges -principally, the Chicago Board of Trade, the
Chicago Mercantile Exchange and the New York Futures Exchange. The Funds would
deal only in standardized contracts on recognized exchanges. Each exchange
guarantees performance under contract provisions through a clearing corporation,
a nonprofit organization managed by the exchange membership.

A public market now exists in futures contracts covering various financial
instruments including long-term United States Treasury Bonds and Notes,
Government National Mortgage Association (GNMA) modified pass-through mortgage
backed securities, three-month United States Treasury Bills, and ninety-day
commercial paper.

B-1
<PAGE>

The Funds may trade in any interest rate futures contracts for which there
exists a public market, including, without limitation, the foregoing
instruments.

Example of Futures Contract Sale. The Funds would engage in an interest
---------------------------------
rate futures contract sale to maintain the income advantage from continued
holding of a long-term bond while endeavoring to avoid part or all of the loss
in market value that would otherwise accompany a decline in long-term securities
prices. Assume that the market value of a certain security held by a particular
Fund tends to move in concert with the futures market prices of long-term United
States Treasury bonds ("Treasury Bonds"). The adviser wishes to fix the current
market value of the portfolio security until some point in the future. Assume
the portfolio security has a market value of 100, and the adviser believes that,
because of an anticipated rise in interest rates, the value will decline to 95.
The fund might enter into futures contract sales of Treasury bonds for an
equivalent of 98. If the market value of the portfolio security does indeed
decline from 100 to 95, the equivalent futures market price for the Treasury
bonds might also decline from 98 to 93.

In that case, the five point loss in the market value of the portfolio
security would be offset by the five point gain realized by closing out the
futures contract sale. Of course, the futures market price of Treasury bonds
might well decline to more than 93 or to less than 93 because of the imperfect
correlation between cash and futures prices mentioned below.

The advisor could be wrong in its forecast of interest rates and the
equivalent futures market price could rise above 98. In this case, the market
value of the portfolio securities, including the portfolio security being
protected, would increase. The benefit of this increase would be reduced by the
loss realized on closing out the futures contract sale.

If interest rate levels did not change, the Fund in the above example might
incur a loss of 2 points (which might be reduced by an offsetting transaction
prior to the settlement date). In each transaction, transaction expenses would
also be incurred.

Example of Futures Contract Purchase. The Funds would engage in an
-------------------------------------
interest rate futures contract purchase when they are not fully invested in
long-term bonds but wish to defer for a time the purchase of long-term bonds in
light of the availability of advantageous interim investments, e.g., shorter
term securities whose yields are greater than those available on long-term
bonds. A Fund's basic motivation would be to maintain for a time the income
advantage from investing in the short-term securities; the Fund would be
endeavoring at the same time to eliminate the effect of all or part of an
expected increase in market price of the long-term bonds that the Fund may
purchase.

For example, assume that the market price of a long-term bond that the Fund
may purchase, currently yielding 10% , tends to move in concert with futures
market prices of Treasury bonds. The advisor wishes to fix the current market
price (and thus 10% yield) of the long-term bond until the time (four months
away in this example) when it may purchase the bond. Assume the long-term bond
has a market price of 100, and the advisor believes that, because of an
anticipated fall in interest rates, the price will have risen to 105 (and the
yield will have dropped to about 91/2%) in four months. The Fund might enter
into futures contracts purchases of Treasury bonds for an equivalent price of
98. At the same time, the Fund would assign a pool of investments in short-term
securities that are either maturing in four months or designated on the books of
the Fund's custodian for sale in four months, for purchase of the long-term bond
at an assumed market price of 100. Assume these short-term securities are
yielding 15%. If the market price of the long-term bond does indeed rise from
100 to 105, the equivalent futures market price for Treasury bonds might also
rise from 98 to 103. In that case, the 5 point increase in the price that the
Fund pays for the long-term bond would be offset by the 5 point gain realized by
closing out the futures contract purchase.

The advisor could be wrong in its forecast of interest rates; long-term
interest rates might rise to above 10%; and the equivalent futures market price
could fall below 98. If short-term rates at the same time fall to 10% or below,
it is possible that the Fund would continue with its purchase program for long-
term bonds. The market price

B-2
<PAGE>

of available long-term bonds would have decreased. The benefit of this price
decrease, and thus yield increase, will be reduced by the loss realized on
closing out the futures contract purchase.

If, however, short-term rates remained above available long-term
rated, it is possible that the Fund would discontinue its purchase program for
long-term bonds. The yield on short-term securities in the portfolio, including
those originally in the pool assigned to the particular long-term bond, would
remain higher than yields on long-term bonds. The benefit of this continued
incremental income will be reduced by the loss realized on closing out the
futures contract purchase. In each transaction, expenses would also be incurred.

II. Index Futures Contracts
-----------------------

General. A bond index assigns relative values of the bonds included in
--------
the index and the index fluctuates with changes in the market values of the
bonds included. The Chicago Board of Trade has designed a futures contract based
on the Bond Buyer Municipal Bond Index. This Index is composed of 40 term
revenue and general obligation bonds and its composition is updated regularly as
new bonds meeting the criteria of the Index are issued and existing bonds
mature. The Index is intended to provide an accurate indicator of trends and
changes in the municipal bond market. Each bond in the Index is independently
priced by six dealer-to-dealer municipal bond brokers daily. The 40 prices then
are averaged and multiplied by a coefficient. The coefficient is used to
maintain the continuity of the Index when its composition changes.

A stock index assigns relative values to the stocks included in the
index and the index fluctuates with changes in the market values of the stocks
included. Some stock index futures contracts are based on broad market indices,
such as the Standard & Poor's 500 or the New York Stock Exchange Composite
Index. In contrast, certain exchanges offer futures contracts on narrower market
indices, such as the Standard & Poor's 100 or indices based on an industry or
market segment, such as oil and gas stocks.

Futures contracts are traded on organized exchanges regulated by the
Commodity Futures Trading Commission. Transactions on such exchanges are cleared
through a clearing corporation, which guarantees the performance of the parties
to each contract.

A Fund will sell index futures contracts in order to offset a decrease
in market value of its portfolio securities that might otherwise result from a
market decline. A Fund will purchase index futures contracts in anticipation of
purchases of securities. In a substantial majority of these transactions, a Fund
will purchase such securities upon termination of the long futures position, but
a long futures position may be terminated without a corresponding purchase of
securities.

In addition, a Fund may utilize index futures contracts in
anticipation of changes in the composition of its portfolio holdings. For
example, in the event that a Fund expects to narrow the range of industry groups
represented in its holdings it may, prior to making purchases of the actual
securities, establish a long futures position based on a more restricted index,
such as an index comprised of securities of a particular industry group. A Fund
may also sell futures contracts in connection with this strategy, in order to
protect against the possibility that the value of the securities to be sold as
part of the restructuring of the portfolio will decline prior to the time of
sale.

Examples of Stock Index Futures Transactions. The following are
---------------------------------------------
examples of transactions in stock index futures (net of commissions and
premiums, if any).

ANTICIPATORY PURCHASE HEDGE: Buy the Future
Hedge Objective: Protect Against Increasing Price

<TABLE>
<CAPTION>
Portfolio Futures
<S> <C>
Anticipate buying $62,500 in Equity Securities -Day Hedge is Placed-
Buying 1 Index Futures at 125
Value of Futures = $62,500/Contract

Buy Equity Securities with Actual Cost = $65,000 Day Hedge is Lifted-
</TABLE>

B-3
<PAGE>

<TABLE>
<S> <C>
Increase in Purchase Price = $2,500 Sell 1 Index Futures at 130
Value of Futures = $65,000/Contract
Gain on Futures = $2,500
</TABLE>

HEDGING A STOCK PORTFOLIO: Sell the Future
Hedge Objective: Protect Against Declining
Value of the Portfolio

Factors:

Value Of Stock Portfolio = $1,000,000
Value of Futures Contract - 125 X $500 =
$62,500 Portfolio Beta Relative to the Index = 1.0

<TABLE>
<CAPTION>
Portfolio Futures
<S> <C>
Anticipate Selling $1,000,000 in Equity Securities - Day Hedge is Placed-
Sell 16 Index Futures at 125
Value of Futures = $1,000,000

Equity Securities - Own Stock Day Hedge is Lifted-
with Value = $960,000 Buy 16 Index Futures at 120
Loss in Portfolio Value = $40,000 Value of Futures = $960,000
Gain on Futures = $40,000
</TABLE>

III. Margin Payments
---------------

Unlike the purchase or sale of portfolio securities, no price is paid
or received by a Fund upon the purchase or sale of a futures contract.
Initially, the Fund will be required to deposit with the broker or in a
segregated account with the Fund's custodian in an amount of cash or cash
equivalents, known as initial margin, based on the value of the contract. The
nature of initial margin in futures transactions is different from that of
margin in securities transactions in that futures contract margin does not
involve the borrowing of funds by the customer to finance the transactions.
Rather, the initial margin is in the nature of a performance bond or good faith
deposit on the contract which is returned to the Fund upon termination of the
futures contract assuming all contractual obligations have been satisfied.
Subsequent payments, called variation margin, to and from the broker, will be
made on a daily basis as the price of the underlying instruments fluctuates
making the long and short positions in the futures contract more or less
valuable, a process known as marking to the market. For example, when a
particular Fund has purchased a futures contract and the price of the contract
has risen in response to a rise in the underlying instruments, that position
will have increased in value and the Fund will be entitled to receive from the
broker a variation margin payment equal to that increase in value. Conversely,
where the Fund has purchased a futures contract and the price of the futures
contract has declined in response to a decrease in the underlying instruments,
the position would be less valuable and the Fund would be required to make a
variation margin payment to the broker. At any time prior to expiration of the
futures contract, the Advisor, World or the Sub-Advisor may elect to close the
position by taking an opposite position, subject to the availability of a
secondary market, which will operate to terminate the Fund's position in the
futures contract. A final determination of variation margin is then made,
additional cash is required to be paid by or released to the Fund, and the Fund
realizes a loss or gain.

IV. Risks of Transactions in Futures Contracts
------------------------------------------

There are several risks in connection with the use of futures by the
Funds as hedging devices. One risk arises because of the imperfect correlation
between movements in the price of futures and movements in the price of the
instruments which are the subject of the hedge. The price of futures may move
more than or less than the price of the instruments being hedged. If the price
of futures moves less than the price of the instruments which are the subject of
the hedge, the hedge will not be fully effective but, if the price of the
instruments being hedged has moved in an unfavorable direction, the Fund would
be in a better position than if it had not hedged at all. If the

B-4
<PAGE>

price of the instruments being hedged has moved in a favorable direction, this
advantage will be partially offset by the loss on the futures. If the price of
the futures moves more than the price of the hedged instruments, the Fund
involved will experience either a loss or gain on the futures which will not be
completely offset by movements in the price of the instruments which are the
subject of the hedge. To compensate for the imperfect correlation of movements
in the price of instruments being hedged and movements in the price of futures
contracts, the Fund may buy or sell futures contracts in a greater dollar amount
than the dollar amount of instruments being hedged if the volatility over a
particular time period of the prices of such instruments has been greater than
the volatility over such time period of the futures, or if otherwise deemed to
be appropriate by the Advisor, World or the Sub-Advisor. Conversely, the Funds
may buy or sell fewer futures contracts if the volatility over a particular time
period of the prices of the instruments being hedged is less than the volatility
over such time period of the futures contract being used, or if otherwise deemed
to be appropriate by the Advisor, World or the Sub-Advisor. It is also possible
that, when the Fund had sold futures to hedge its portfolio against a decline in
the market, the market may advance and the value of the futures instruments held
in the Fund may decline. If this occurs, the Fund would lose money on the
futures and also experience a decline in value in its portfolio securities.

Where futures are purchased to hedge against a possible increase in
the price of securities before a Fund is able to invest its cash (or cash
equivalents) in an orderly fashion, it is possible that the market may decline
instead; if the Fund then concludes not to invest its cash at that time because
of concern as to possible further market decline or for other reasons, the Funds
will realize a loss on the futures contract that is not offset by a reduction in
the price of the securities that were to be purchased.

In instances involving the purchase of futures contracts by the Funds,
an amount of cash and cash equivalents, equal to the market value of the futures
contracts, will be deposited in a segregated account with the Fund's custodian
and/or in a margin account with a broker to collateralize the position and
thereby insure that the use of such futures is unleveraged.

In addition to the possibility that there may be an imperfect
correlation, or no correlation at all, between movements in the futures and the
instruments being hedged, the price of futures may not correlate perfectly with
movement in the cash market due to certain market distortions. Rather than
meeting additional margin deposit requirements, investors may close futures
contracts through off-setting transactions which could distort the normal
relationship between the cash and futures markets. Second, with respect to
financial futures contracts, the liquidity of the futures market depends on
participants entering into off-setting transactions rather than making or taking
delivery. To the extent participants decide to make or take delivery, liquidity
in the futures market could be reduced, thus producing distortions. Third, from
the point of view of speculators, the deposit requirements in the futures market
are less onerous than margin requirements in the securities market. Therefore,
increased participation by speculators in the futures market may also cause
temporary price distortions. Due to the possibility of price distortion in the
futures market, and because of the imperfect correlation between the movements
in the cash market and movements in the price of futures, a correct forecast of
general market trends or interest rate movements by the Advisor, World or the
Sub-Advisor may still not result in a successful hedging transaction over a
short time frame.

Positions in futures may be closed out only on an exchange or board of
trade which provides a secondary market for such futures. Although the Funds
intend to purchase or sell futures only on exchanges or boards of trade where
there appear to be active secondary markets, there is no assurance that a liquid
secondary market on any exchange or board of trade will exist for any particular
contract or at any particular time. When there is no liquid market, it may not
be possible to close a futures investment position, and in the event of adverse
price movements, the Funds would continue to be required to make daily cash
payments of variation margin. However, in the event futures contracts have been
used to hedge portfolio securities, such securities will not be sold until the
futures contract can be terminated. In such circumstances, an increase in the
price of the securities, if any, may partially or completely offset losses on
the futures contract. However, as described above, there is no guarantee that
the price of the securities will in fact correlate with the price movements in
the futures contract and thus provide an offset on a futures contract.

B-5
<PAGE>

Further, it should be noted that the liquidity of a secondary market
in a futures contract may be adversely affected by "daily price fluctuation
limits" established by commodities exchanges which limit the amount of
fluctuation in a futures contract price during a single trading day. Once the
daily limit has been reached in the contract, no trades may be entered into at a
price beyond the limit, thus preventing the liquidation of open futures
positions. The trading of futures contracts is also subject to the risk of
trading halts, suspensions, exchange or clearing house equipment failures,
government intervention, insolvency of a brokerage firm or clearing house or
other disruptions of normal activity, which could at times make it difficult or
impossible to liquidate existing positions or to recover excess variation margin
payments.

Successful use of futures by the Funds is also subject to the
Advisor's, World's or the Sub-Advisor's ability to predict correctly movements
in the direction of the market. For example, if a particular Fund has hedged
against the possibility of a decline in the market adversely affecting
securities held by it and securities prices increase instead, the Fund will lose
part or all of the benefit to the increased value of its securities which it has
hedged because it will have offsetting losses in its futures positions. In
addition, in such situations, if the Fund has insufficient cash, it may have to
sell securities to meet daily variation margin requirements. Such sales of
securities may be, but will not necessarily be, at increased prices which
reflect the rising market. The Funds may have to sell securities at a time when
it may be disadvantageous to do so.

V. Options on Futures Contracts
----------------------------

The Funds may purchase and write options on the futures contracts
described above. A futures option gives the holder, in return for the premium
paid, the right to buy from(call) or sell to(put) the writer of the option a
futures contract at a specified price at any time during the period of the
option. Upon exercise, the writer of, the option is obligated to pay the
difference between the cash value of the futures contract and the exercise
price. Like the buyer or seller of a futures contract, the holder, or writer, of
an option has the right to terminate its position prior to the scheduled
expiration of the option by selling, or purchasing an option of the same series,
at which time the person entering into the closing transaction will realize a
gain or loss. A Fund will be required to deposit initial margin and variation
margin with respect to put and call options on futures contracts written by it
pursuant to brokers' requirements similar to those described above. Net option
premiums received will be included as initial margin deposits.

Investments in futures options involve some of the same considerations
that are involved in connection with investments in future contracts (for
example, the existence of a liquid secondary market). In addition, the purchase
or sale of an option also entails the risk that changes in the value of the
underlying futures contract will not correspond to changes in the value of the
option purchased. Depending on the pricing of the option compared to either the
futures contract upon which it is based, or upon the price of the securities
being hedged, an option may or may not be less risky than ownership of the
futures contract or such securities. In general, the market prices of options
can be expected to be more volatile than the market prices on underlying futures
contract. Compared to the purchase or sale of futures contracts, however, the
purchase of call or put options on futures contracts may frequently involve less
potential risk to the Fund because the maximum amount at risk is the premium
paid for the options (plus transaction costs). The writing of an option on a
futures contract involves risks similar to those risks relating to the sale of
futures contracts.

VI. Currency Transactions
---------------------

The Fund may engage in currency transactions in order to hedge the
value of portfolio holdings denominated in particular currencies against
fluctuations in relative value. Currency transactions include forward currency
contracts, currency futures, options on currencies, and currency swaps. A
forward currency contract involves a privately negotiated obligation to purchase
or sell (with delivery generally required) a specific currency at a future date,
which may be any fixed number of days from the date of the contract agreed upon
by the parties, at a price set at the time of the contract. A currency swap is
an agreement to exchange cash flows based on the notional difference among two
or more currencies and operates similarly to an interest rate swap as described
in the SAI. The Fund may enter into currency transactions with counterparties
which have received (or the guarantors of

B-6
<PAGE>

the obligations which have received) a credit rating of A-1 or P-1 by S&P or
Moody's, respectively, or that have an equivalent rating from a NRSRO or are
determined to be of equivalent credit quality by the Advisor or World.

The Fund's dealings in forward currency contracts and other currency
transactions such as futures, options, options on futures and swaps will be
limited to hedging involving either specific transactions or portfolio
positions. Transaction hedging is entering into a currency transaction with
respect to specific assets or liabilities of the Fund, which will generally
arise in connection with the purchase or sale of its portfolio securities or the
receipt of income therefrom. Position hedging is entering into a currency
transaction with respect to portfolio security positions denominated or
generally quoted in that currency.

The Fund will not enter into a transaction to hedge currency exposure
to an extent greater after netting all transactions intended wholly or partially
to offset other transactions, than the aggregate market value (at the time of
entering into the transaction) of the securities held in its portfolio that are
denominated or generally quoted in or currently convertible into such currency,
other than with respect to proxy hedging as described below.

The Fund may also cross-hedge currencies by entering into transactions
to purchase or sell one or more currencies that are expected to decline in value
relative to other currencies to which the Fund has or in which the Fund expects
to have portfolio exposure.

To reduce the effect of currency fluctuations on the value of existing
or anticipated holdings of portfolio securities, the Fund may also engage proxy
hedging. Proxy hedging is often used when the currency to which the Fund's
portfolio is exposed is difficult to hedge or to hedge against the dollar. Proxy
hedging entails entering into a commitment or option to sell a currency whose
changes in value are generally considered to be correlated to a currency or
currencies in which some or all of the Fund's portfolio securities are or are
expected to be denominated, in exchange for U.S. dollars. The amount of the
commitment or option would not exceed the value of the Fund's securities
denominated in correlated currencies. For example, if the Advisor, World or the
Sub-Advisor considers that the Austrian schilling is correlated to the German
mark (the "D-mark"), the Fund holds securities denominated in shillings and the
Advisor, World or the Sub-Advisor believes that the value of the schillings will
decline against the U.S. dollar, the Advisor, World or the Sub-Advisor may enter
into a commitment or option to sell D-marks and buy dollars. Currency hedging
involves some of the same risks and considerations as other transactions with
similar instruments. Currency transactions can result in losses to the Fund if
the currency being hedged fluctuates in value to a degree or in a direction that
is not anticipated. Further, there is the risk that the perceived correlation
between various currencies may not be present or may not be present during the
particular time that the Fund is engaging in proxy hedging. If a Fund enters
into a currency hedging transaction, the Fund will designate liquid, high grade
assets on the books of the Fund's custodian to the extent the Fund's obligations
are not otherwise "covered" through ownership of the underlying currency.

Currency transactions are subject to risks different from those of
other portfolio transactions. Because currency control is of great importance to
the issuing governments and influences economic planning and policy, purchases
and sales of currency and related instruments can be negatively affected by
government exchange controls, blockages, and manipulations or exchange
restrictions imposed by governments. These can result in losses to the Fund if
it is unable to deliver or receive currency or funds in settlement of
obligations and could also cause hedges it has entered into to be rendered
useless, resulting in full currency exposure as well as incurring transaction
costs. Buyers and sellers of currency futures are subject to the same risks that
apply to the use of futures generally. Further, settlement of a currency futures
contract for the purchase of most currencies must occur at a bank based in the
issuing nation. Trading options on currency futures is relatively new, and the
ability to establish and close to positions on such options is subject to the
maintenance of a liquid market which may not always be available. Currency
exchange rates may fluctuate based on factors extrinsic to that country's
economy.

VII. Other Matters
-------------

Accounting for futures contracts will be in accordance with generally
accepted accounting principles.

B-7
<PAGE>

VII. Options
-------

Each of the Equity Funds, Balanced Fund, Bond Funds, International
Bond Fund and Tax-Free Bond Funds (other than Tax-Free Short-Intermediate Bond
Fund) may write covered call options, buy put options, buy call options and
write secured put options. Such options may relate to particular securities and
may or may not be listed on a national securities exchange and issued by the
Options Clearing Corporation. Options trading is a highly specialized activity
which entails greater than ordinary investment risk. Options on particular
securities may be more volatile than the underlying securities, and therefore,
on a percentage basis, an investment in options may be subject to greater
fluctuation than an investment in the underlying securities themselves.

A call option for a particular security gives the purchaser of the
option the right to buy, and the writer of the option the obligation to sell,
the underlying security at the stated exercise price at any time prior to the
expiration of the option, regardless of the market price of the security. The
premium paid to the writer is in consideration for undertaking the obligations
under the option contract. A put option for a particular security gives the
purchaser the right to sell, and the writer of the option the obligation to buy,
the underlying security at the stated exercise price at any time prior to the
expiration date of the option, regardless of the market price of the security.

The writer of an option that wishes to terminate its obligation may
effect a "closing purchase transaction." This is accomplished by buying an
option of the same series as the option previously written. The effect of the
purchase is that the writer's position will be canceled by the clearing
corporation. However, a writer may not effect a closing purchase transaction
after being notified of the exercise of an option. Likewise, an investor who is
the holder of an option may liquidate its position by effecting a "closing sale
transaction." The cost of such a closing purchase plus transaction costs may be
greater than the premium received upon the original option, in which event the
Fund will have incurred a loss in the transaction. There is no guarantee in any
instance that either a closing purchase or a closing sale transaction can be
effected.

Effecting a closing transaction in the case of a written call option
will permit the Funds to write another call option on the underlying security
with either a different exercise price or expiration date or both, or in the
case of a written put option, will permit the Funds to write another put option
to the extent that the exercise price thereof is secured by deposited cash or
short-term securities. Also, effecting a closing transaction will permit the
cash or proceeds from the concurrent sale of any securities subject to the
option to be used for other Fund investments. If a Fund desires to sell a
particular security from its portfolio on which it has written a call option, it
will effect a closing transaction prior to or concurrent with the sale of the
security.

The Funds may write options in connection with buy-and-write
transactions; that is, the Funds may purchase a security and then write a call
option against that security. The exercise price of the call the Funds determine
to write will depend upon the expected price movement of the underlying
security. The exercise price of a call option may be below ("in-the-money"),
equal to ("at-the-money") or above ("out-of-the-money") the current value of the
underlying security at the time the option is written. Buy-and-write
transactions using in-the-money call options may be used when it is expected
that the price of the underlying security will remain flat or decline moderately
during the option period. Buy-and-write transactions using out-of-the-money call
options may be used when it is expected that the premiums received from writing
the call option plus the appreciation in the market price of the underlying
security up to the exercise price will be greater than the appreciation in the
price of the underlying security alone. If the call options are exercised in
such transactions, the maximum gain to the relevant Fund will be the premium
received by it for writing the option, adjusted upwards or downwards by the
difference between the Fund's purchase price of the security and the exercise
price. If the options are not exercised and the price of the underlying security
declines, the amount of such decline will be offset in part, or entirely, by the
premium received.

In the case of writing a call option on a security, the option is
"covered" if a Fund owns the security underlying the call or has an absolute and
immediate right to acquire that security without additional cash consideration
(or, if additional cash consideration is required, cash or liquid securities in
such amount as are earmarked on the books of the Fund's custodian) upon
conversion or exchange of other securities held by it. For a call option on an
index, the option is covered if a Fund maintains with its custodian cash or
liquid securities equal to the contract value. A call option is also covered if
a Fund holds a call on the same security or index as the call

B-8
<PAGE>

written where the exercise price of the call held is (i) equal to or less than
the exercise price of the call written, or (ii) greater than the exercise price
of the call written provided the difference in cash or liquid securities is
earmarked on the books of the Fund's custodian. A Fund will limit its investment
in uncovered call options purchased or written by the Fund to 33 1/3% of the
Fund's total assets. A Fund will write put options only if they are "secured" by
cash or liquid securities earmarked on the books of the Fund's custodian in an
amount not less than the exercise price of the option at all times during the
option period.

The writing of covered put options is similar in terms of risk/return
characteristics to buy-and-write transactions. If the market price of the
underlying security rises or otherwise is above the exercise price, the put
option will expire worthless and the relevant Fund's gain will be limited to the
premium received. If the market price of the underlying security declines or
otherwise is below the exercise price, the Fund may elect to close the position
or take delivery of the security at the exercise price and the Fund's return
will be the premium received from the put option minus the amount by which the
market price of the security is below the exercise price.

The Funds may purchase put options to hedge against a decline in the
value of their portfolios. By using put options in this way, a Fund will reduce
any profit it might otherwise have realized in the underlying security by the
amount of the premium paid for the put option and by transaction costs. The
Funds may purchase call options to hedge against an increase in the price of
securities that they anticipate purchasing in the future. The premium paid for
the call option plus any transaction costs will reduce the benefit, if any,
realized by a Fund upon exercise of the option, and, unless the price of the
underlying security rises sufficiently, the option may expire worthless to the
Fund.

When a Fund purchases an option, the premium paid by it is recorded as
an asset of the Fund. When the Fund writes an option, an amount equal to the net
premium (the premium less the commission) received by the Fund is included in
the liability section of the Fund's statement of assets and liabilities as a
deferred credit. The amount of this asset or deferred credit will be
subsequently marked to market to reflect the current value of the option
purchased or written. The current value of the traded option is the last sale
price or, in the absence of a sale, the average of the closing bid and asked
prices. If an option purchased by the Fund expires unexercised the Fund realizes
a loss equal to the premium paid. If the Fund enters into a closing sale
transaction on an option purchased by it, the Fund will realize a gain if the
premium received by the Fund on the closing transaction is more than the premium
paid to purchase the option, or a loss if it is less. If an option written by
the Fund expires on the stipulated expiration date or if the Fund enters into a
closing purchase transaction, it will realize a gain (or loss if the cost of a
closing purchase transaction exceeds the net premium received when the option is
sold) and the deferred credit related to such option will be eliminated. If an
option written by the Fund is exercised, the proceeds of the sale will be
increased by the net premium originally received and the Fund will realize a
gain or loss.

There are several risks associated with transactions in options on
securities and indices. For example, there are significant differences between
the securities and options markets that could result in an imperfect correlation
between these markets, causing a given transaction not to achieve its
objectives. An option writer unable to effect a closing purchase transaction
will not be able to sell the underlying security (in the case of a covered call
option) or liquidate the earmarked securities (in the case of a secured put
option) until the option expires or the optioned security is delivered upon
exercise with the result that the writer in such circumstances will be subject
to the risk of market decline or appreciation in the security during such
period.

There is no assurance that a Fund will be able to close an unlisted
option position. Furthermore, unlisted options are not subject to the
protections afforded purchasers of listed options by the Options Clearing
Corporation, which performs the obligations of its members who fail to do so in
connection with the purchase or sale of options.

In addition, a liquid secondary market for particular options, whether
traded over-the-counter or on a national securities exchange (an "Exchange"),
may be absent for reasons which include the following: there may be insufficient
trading interest in certain options; restrictions may be imposed by an Exchange
on opening transactions or closing transactions or both; trading halts,
suspensions or other restrictions may be imposed with respect to particular
classes or series of options or underlying securities; unusual or unforeseen
circumstances may interrupt normal operations on an Exchange; the facilities of
an Exchange or the Options Clearing Corporation may not at all

B-9
<PAGE>

times be adequate to handle current trading volume; or one or more Exchanges
could, for economic or other reasons, decide or be compelled at some future date
to discontinue the trading of options (or a particular class or series of
options), in which event the secondary market on that Exchange (or in that class
or series of options) would cease to exist, although outstanding options that
had been issued by the Options Clearing Corporation as a result of trades on
that Exchange would continue to be exercisable in accordance with their terms.

Currency transactions, including options on currencies and currency
futures, are subject to risks different from those of other portfolio
transactions. Because currency control is of great importance to the issuing
governments and influences economic planning and policy, purchases and sales of
currency and related instruments can be negatively affected by government
exchange controls, blockages, and manipulations or exchange restrictions imposed
by governments. These can result in losses to a Fund if it is unable to deliver
or receive currency or funds in settlement of obligations and could also cause
hedges it has entered into to be rendered useless, resulting in full currency
exposure as well as the incurring of transaction costs. Buyers and sellers of
currency futures are subject to the same risks that apply to the use of futures
generally. Further, settlement of a currency futures contract for the purchase
of most currencies must occur at a bank based in the issuing nation. Trading
options on currency futures is relatively new, and the ability to establish and
close out positions on such options is subject to the maintenance of a liquid
market which may not always be available. Currency exchange rates may fluctuate
based on factors extrinsic to the issuing country's economy.

B-10
<PAGE>

PART C

OTHER INFORMATION

Item 23. Exhibits
--------

(a) (1) Declaration of Trust of the Registrant, dated August 30, 1989, is
incorporated herein by reference to Exhibit (1) to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
September 1, 1989.

(2) Amendment No. 1 to Declaration of Trust of the Registrant is
incorporated herein by reference to Exhibit (1)(b) to Pre-Effective
Amendment No. 1 to the Registrant's Registration Statement on Form N-
1A filed with the Commission on November 21, 1989.

(3) Amendment No. 2 to Declaration of Trust of the Registrant is
incorporated herein by reference to Exhibit (1)(c) to Post-Effective
Amendment No. 1 to the Registrant's Registration Statement on Form
N-1A filed with the Commission on February 22, 1990.

(4) Amendment No. 3 to the Declaration of Trust is incorporated herein by
reference to Exhibit 1(d) to Post-Effective Amendment No. 20 filed
with the Commission on June 28, 1995.

(5) Certificate of Classification of Shares, dated August 30, 1991,
pertaining to Class D shares; Class E shares; Class F shares; Class G
shares; Class H shares; and Class I shares is incorporated herein by
reference to Exhibit (1)(d) to Post-Effective Amendment No. 7 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on August 3, 1992.

(6) Certificate of Classification of Shares pertaining to Class A-1 shares
and Class A-2 shares; Class B-1 shares and Class B-2 shares; Class C-1
shares and Class C-2 shares; Class D-1 shares and Class D-2 shares;
Class E-1 shares and Class E-2 shares; Class F-1 shares and Class F-2
shares; Class G-1 shares and Class G-2 shares; Class H-1 shares and
Class H-2 shares; Class I-1 shares and Class I-2 shares; Class J
shares; Class J-1 shares; and Class J-2 shares; and Class K shares;
Class K-1 shares and Class K-2 shares is incorporated herein by
reference to Exhibit (1)(e) to Post-Effective Amendment No. 7 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on August 3, 1992.

(7) Certificate of Classification of Shares pertaining to Class L shares,
Class L-1 shares and Class L-2 shares is incorporated herein by
reference to Exhibit (1)(f) to Post-Effective Amendment No. 10 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on April 30, 1993.

(8) Certificate of Classification of Shares pertaining to Class M shares,
Class M-1 shares and Class M-2 shares is incorporated herein by
reference to Exhibit (1)(g) to Post-Effective Amendment No. 11 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on June 29, 1993.

(9) Certificate of Classification of Shares pertaining to Class N shares,
Class N-1 shares and Class N-2 shares is incorporated herein by
reference to Exhibit (1)(h) to Post-Effective Amendment No. 14 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on December 30, 1993.

(10) Certificate of Classification of Shares pertaining to Class O shares,
Class O-1 shares and Class O-2 shares; Class P shares, Class P-1
shares and Class P-2 shares is incorporated herein by reference to
Exhibit 1(i) to Post-Effective Amendment No. 15 to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
February 28, 1994.

<PAGE>

(11) Certificate of Classification of Shares pertaining to Class A-3
shares; Class D-3 shares; Class E-3 shares; Class G-3 shares; Class
H-3 shares; Class I-3 shares; Class J-3 shares; Class K-3 shares;
Class L-3 shares; Class M-3 shares; Class N-3 shares; Class O shares;
Class O-1 shares; Class O-2 shares; Class O-3 shares; Class P shares;
Class P-1 shares; Class P-2 shares and Class P-3 shares is
incorporated herein by reference to Exhibit (1)(j) to Post-Effective
Amendment No. 17 to the Registrant's Registration Statement on Form
N-1A filed with the Commission on June 28, 1994.

(12) Certificate of Classification of Shares pertaining to Class D-4
shares, E-4 shares, F-4 shares, G-4 shares, H-4 shares, I-4 shares,
K-4 shares, L-4 shares, M-4 shares, N-4 shares, O-4 shares and P-4
shares is incorporated herein by reference to Exhibit 1(L) to Post-
Effective Amendment No. 20 filed with the Commission on June 28, 1995.

(13) Certificate of Classification of Shares pertaining to Class F-3 for
the Index Fund Class B Shares is incorporated herein by reference to
Exhibit 1(m) to Post-Effective Amendment No. 23 filed with the
Commission on October 28, 1996.

(b) Registrant's Code of Regulations is incorporated herein by reference to
Exhibit (2) to the Registrant's Registration Statement on Form N-1A filed
with the Commission on September 1, 1989.

(c) Registrant's Code of Regulations is incorporated herein by reference to
Exhibit (2) to the Registrant's Registration Statement on Form N-1A filed
with the Commission on September 1, 1989.

(d) Investment Advisory Agreement, dated July 2, 1998, between Registrant and
Munder Capital Management is incorporated herein by reference to Exhibit 5
to Post-Effective No. 26 to the Registrant's Registration Statement on Form
N-1A filed with the Commission on August 28, 1998.

(e) (1) Amended and Restated Distribution Agreement, dated January 21, 1994,
between Registrant and Funds Distributor, Inc. is incorporated herein
by reference to Exhibit (6)(h) to Post-Effective Amendment No. 17 to
the Registrant's Registration Statement on Form N-1A filed with the
Commission on June 28, 1994.

(2) Amendment, dated July 14, 1995, to the Amended and Restated
Distribution Agreement between Registrant and Funds Distributor, Inc.
is incorporated herein by reference to Exhibit 6(i) to Post-Effective
Amendment No. 23 to the Registrant's Registration Statement on Form
N-1A filed with the Commission on October 28, 1996.

(f) Not Applicable.

(g) (1) Custodian Agreement between Registrant and State Street Bank and Trust
Company is filed herein.

(h) (1) Administration Agreement, dated October 31, 1997, between State Street
Bank and Trust Company is incorporated by reference to Exhibit 9(a) to
Post-Effective Amendment No. 26 to the Registrant's Registration
Statement on Form N-1A filed with the Commission on August 28, 1998.

(2) Transfer Agency and Registrar Agreement, dated June 28, 1995, between
Registrant and The Shareholder Services Group, Inc. is incorporated
herein by reference to Exhibit 9(y) to Post-Effective Amendment No. 23
to the Registrant's Registration Statement on Form N-1A filed with the
Commission on October 28, 1996.

2
<PAGE>

(3) Form of Amendment dated February 4, 1997 to the Transfer Agency and
Registrar Agreement dated June 28, 1995 is incorporated herein by
reference to Exhibit 9 (bb) to Post-Effective Amendment No. 24 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on August 29, 1997.

(4) Form of Amendment dated May 6, 1997 to the Transfer Agency and
Registrar Agreement dated June 28, 1995 is between Registrant and
First Data Investor Services Group, Inc. is incorporated herein by
reference to Exhibit 9 (cc) to Post-Effective Amendment No. 24 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on August 29, 1997.

(5) Amendment No. 1, dated June 1, 1998, to the Transfer Agency and
Registrar Agreement dated June 28, 1995 between Registrant and First
Data Investor Services Group, Inc. is incorporated herein by reference
to Exhibit 9(e) to Post-Effective No. 26 to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
August 28, 1998.

(6) Amendment No. 2, dated June 1, 1998, to the Transfer Agency and
Registrar Agreement dated June 28, 1995 between Registrant and First
Data Investor Services Group, Inc. is incorporated herein by reference
to Exhibit 9(f) to Post-Effective No. 26 to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
August 28, 1998.

(7) Amendment No. 3, dated June 1, 1998, to the Transfer Agency and
Registrar Agreement dated June 28, 1995 between Registrant and First
Data Investor Services Group, Inc. is incorporated herein by reference
to Exhibit 9(g) to Post-Effective No. 26 to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
August 28, 1998.

(8) Amendment, dated March 16, 1999, to Transfer Agency and Registrar
Agreement dated June 28, 1995, between Registrant and First Data
Investor Services Group, Inc. is filed herein.

(9) Amendment, dated March 26, 1999, to Transfer Agency and Registrar
Agreement dated June 28, 1995, between Registrant and First Data
Investor Services Group, Inc. is filed herein.

(i) (1) Opinion and Consent of Counsel is incorporated by reference to the
Rule 24f-2 Notice filed on August 28, 1997, Accession Number
0000927405-97-000310.

(2) Consent of Counsel is incorporated herein by reference to Exhibit
(10)(b) to Post-Effective Amendment No. 27 to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
October 27, 1998.

(j) (1) Powers of Attorney are incorporated herein by reference to Exhibit
11(b) to Post-Effective Amendment No. 26 to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
August 28, 1998.

(2) Certified Resolution of Board Authorizing Signature on behalf of
Registrant pursuant to Power of Attorney is incorporated herein by
reference to Exhibit 11(c) to Post-Effective Amendment No. 26 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on August 28, 1998.

(k) Not Applicable.

(l) Purchase Agreement between Registrant and Shearson Lehman Hutton Inc. dated
November 13, 1989 is incorporated herein by reference to Exhibit (13) to
Post-Effective Amendment No. 2 to the Registrant's Registration Statement
on Form N-1A filed with the Commission on October 1, 1990.

3
<PAGE>

(m) (1) Amended and Restated Distribution and Service Plan - Class A Shares,
dated January 21, 1994, is incorporated herein by reference to Exhibit
15(f) of Post-Effective Amendment No. 23 to the Registrant's
Registration Statement on Form N-1A filed with the Commission on
October 28, 1996.

(2) Distribution and Servicing Agreement, dated February 10, 1994, is
incorporated herein by reference to Exhibit 15(g) of Post-Effective
Amendment No. 23 to the Registrant's Registration Statement on Form
N-1A filed with the Commission on October 28, 1996.

(3) Class B Shares Distribution and Service Plan is incorporated herein by
reference to Exhibit 15(h) of Post-Effective Amendment No. 23 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on October 28, 1996.

(4) Form of Class B Shares Distribution and Servicing Agreement is
incorporated herein by reference to Exhibit 15(i) of Post-Effective
Amendment No. 23 to the Registrant's Registration Statement on Form
N-1A filed with the Commission on October 28, 1996.

(5) Class C Shares Distribution and Service Plan is incorporated herein by
reference to Exhibit 15(j) of Post-Effective Amendment No. 23 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on October 28, 1996.

(6) Form of Class C Shares Distribution and Servicing Agreement is
incorporated herein by reference to Exhibit 15(k) of Post-Effective
Amendment No. 23 to the Registration Statement on Form N-1A filed with
the Commission on October 28, 1996.

(7) Form of Servicing Agreement (Class K Shares) is incorporated herein by
reference to Exhibit 15(m) of Post-Effective Amendment No. 23 to the
Registrant's Registration Statement on Form N-1A filed with the
Commission on October 28, 1996.

(8) Amended and Restated Service Plan for Class K Shares is incorporated
herein by reference to Exhibit 15(n) of Post-Effective Amendment
No. 24 to the Registrant's Registration Statement on Form N-1A filed
with the Commission on August 29, 1997.

(n) Not Applicable.

(o) Second Amended and Restated Multi-Class Plan is filed herein.

Item 24. Persons Controlled by or under Common Control with Registrant
-------------------------------------------------------------

Not Applicable.

4
<PAGE>

Item 25. Indemnification
---------------

Indemnification of Registrant's principal underwriter against certain
losses is provided for in Section V of the Amended and Restated
Distribution Agreement incorporated herein by reference to Exhibit 6 (e)
hereto. Indemnification of Registrant's Custodian is provided for,
respectively, in Section 22 of the Custodian Agreement incorporated herein
by reference as Exhibit 8(a) hereto. Registrant has obtained from a major
insurance carrier a trustees' and officers' liability policy covering
certain types of errors and omissions. In addition, Section 9.3 of the
Registrant's Agreement and Declaration of Trust incorporated herein by
reference as Exhibit 1(a) hereto provides as follows:

Indemnification of Trustees, Officers, Representatives and Employees. The
Trust shall indemnify each of its Trustees against all liabilities and
expenses (including amounts paid in satisfaction of judgments, in
compromise, as fines and penalties, and as counsel fees) reasonably
incurred by him in connection with the defense or disposition of any
action, suit or other proceeding, whether civil or criminal in which he may
be involved or with which he may be threatened, while as a Trustee or
thereafter, by reason of his being or having been such a Trustee except
with respect to any matter as to which he shall have been adjudicated to
have acted in bad faith, willful misfeasance, gross negligence or reckless
disregard of his duties, provided that as to any matter disposed of by a
compromise payment by such person, pursuant to a consent decree or
otherwise, no indemnification either for said payment or for any other
expenses shall be provided unless the Trust shall have received a written
opinion from independent legal counsel approved by the Trustees to the
effect that if either the matter of willful misfeasance, gross negligence
or reckless disregard of duty, or the matter of bad faith had been
adjudicated, it would in the opinion of such counsel have been adjudicated
in favor of such person. The rights accruing to any person under these
provisions shall not exclude any other right to which he may be lawfully
entitled, provided that no person may satisfy any right of indemnity or
reimbursement hereunder except out of the property of the Trust. The
Trustees may make advance payments in connection with the indemnification
under this Section 9.3, provided that the indemnified person shall have
given a written undertaking to reimburse the Trust in the event it is
subsequently determined that he is not entitled to such indemnification.

The Trustees shall indemnify officers, representatives and employees of the
Trust to the same extent that Trustees are entitled to indemnification
pursuant to this Section 9.3.

Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to trustees, officers and controlling persons of
Registrant pursuant to the foregoing provisions, or otherwise, Registrant
has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in
the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
Registrant of expenses incurred or paid by a trustee, officer or
controlling person of Registrant in the successful defense of any action,
suit or proceeding) is asserted by such trustee, officer or controlling
person in connection with the securities being registered, Registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.

Section 9.6 of the Registrant's Agreement and Declaration of Trust,
incorporated herein by reference as Exhibit 1(a), also provides for the
indemnification of shareholders of the Registrant. Section 9.6 states as
follows:

Indemnification of Shareholders. In case any Shareholder or former
Shareholder shall be held to be personally liable solely by reason of his
being or having been a Shareholder and not because of his acts or omissions
or for some other reason, the Shareholder or former Shareholder (or his
heirs, executors, administrators or other legal representatives or, in the
case of a corporation or other entity, its corporate or

5
<PAGE>

other general successor) shall be entitled out of the assets belonging to
the classes of Shares with the same alphabetical designation as that of the
Shares owned by such Shareholder to be held harmless from and indemnified
against all loss and expense arising from such liability. The Trust shall,
upon request by the Shareholder, assume the defense of any claim made
against any Shareholder for any act or obligations of the Trust and satisfy
any judgment thereon from such assets.

Item 26. Business and Other Connections of Investment Advisors
----------------------------------------------------

(a) Munder Capital Management (the "Advisor") performs investment
advisory services for Registrant and other investment companies and
institutional and individual investors.

MUNDER CAPITAL MANAGEMENT

<TABLE>
<CAPTION>
Name Position with Advisor
<S> <C>
Old MCM, Inc. Partner
Munder Group LLC Partner
WAM Holdings, Inc. Partner
WAM Holdings II, Inc. Partner
Lee P. Munder Chairman
Leonard J. Barr, II Senior Vice President and Director of Research
Clark Durant Vice President and Director of The Private Management Group
Terry H. Gardner Vice President and Chief Financial Officer
Elyse G. Essick Vice President and Director of Communications and Client
Services
Sharon E. Fayolle Vice President and Director of Money Market Trading
Otto G. Hinzmann Vice President and Director of Equity Portfolio Management
Anne K. Kennedy Vice President and Director of Corporate Bond Trading
Richard R. Mullaney Senior Vice President of The Private Management Group
Ann F. Putallaz Vice President and Director of Retirement Services Group
Peter G. Root Vice President and Director of Government Securities
Trading
James C. Robinson Executive Vice President and Chief Investment
Officer/Fixed Income
Gerald L. Seizert Chief Investment Officer-Equities
Paul D. Tobias Chief Executive Officer
</TABLE>

For further information relating to the Investment Advisor's officers,
reference is made to Form ADV filed under the Investment Advisers Act
of 1940 by Munder Capital Management, SEC File No. 801-48394.

World Asset Management, L.L.C.
------------------------------

Name Position with Advisor
---- ---------------------
Terry H. Gardner Chief Financial Officer
Todd B. Johnson President, Chief Investment Officer
and Chief Executive Officer
Robert J. Kay Director, Client Services
Theodore D. Miller Director, International Investments
Kenneth A. Schluchter, III Director, Domestic Investments

For further information relating to the Advisor's officers,
reference is made to Form ADV filed under the Investment Advisers Act
of 1940 by World Asset Management, L.L.C., SEC File No. 801-55795.

Item 27. Principal Underwriters.
-----------------------

(a) Funds Distributor, Inc. ("FDI"), located at 60 State Street, Suite
1300, Boston, Massachusetts 02109. FDI is an indirectly wholly-owned
subsidiary of Boston Institutional Group, Inc. a holding company, all
of whose outstanding shares are owned by key employees. FDI is
registered with the Securities and Exchange Commission as a broker-
dealer and is a member of the National Association of Securities
Dealers. FDI acts as principal underwriter of the following
investment companies other than the Registrant:

American Century California Tax-Free and Municipal Funds
American Century Capital Portfolios, Inc.

6
<PAGE>

American Century Government Income Trust
American Century International Bond Funds
American Century Investment Trust
American Century Municipal Trust
American Century Mutual Funds, Inc.
American Century Premium Reserves, Inc.
American Century Quantitative Equity Funds
American Century Strategic Asset Allocations, Inc.
American Century Target Maturities Trust
American Century Variable Portfolios, Inc.
American Century World Mutual Funds, Inc.
The Brinson Funds
Dresdner RCM Capital Funds, Inc.
Dresdner RCM Global Funds, Inc.
Dresdner RCM Investment Funds, Inc.
Founders Funds, Inc.
JP Morgan Institutional Funds
JP Morgan Funds
JPM Series Trust
JPM Series Trust II
Kobrick Investment Trust
LaSalle Partners Funds, Inc.
Merrimac Series
Monetta Fund, Inc.
Monetta Trust
The Montgomery Funds I
The Montgomery Funds II
The Munder Framlington Funds Trust
The Munder Funds Trust
National Investors Cash Management Fund, Inc.
Nomura Pacific Basin Fund, Inc.
Orbitex Group of Funds
SG Cowen Funds, Inc.
SG Cowen Income & Growth Fund, Inc.
SG Cowen Standby Reserve Fund, Inc.
SG Cowen Standby Tax-Exempt Reserve Fund, Inc.
SG Cowen Series Fund, Inc.
SoGen Funds, Inc.
SoGen Variable Funds, Inc.
St. Clair Funds, Inc.
The Skyline Funds
Waterhouse Investors Family of Funds, Inc.
WEBS Index Fund, Inc.

(b) The following is a list of the executive officers, directors and
partners of Funds Distributor, Inc.

<TABLE>
<S> <C>
Director, President and Chief Executive Officer -Marie E. Connolly
Executive Vice President -George A. Rio
Executive Vice President -Donald R. Roberson
Executive Vice President -William S. Nichols
Senior Vice President, General Counsel, Chief Compliance -Margaret W. Chambers
Officer, Secretary and Clerk
Director, Senior Vice President, Treasurer and -Joseph F. Tower, III
Chief Financial Officer
</TABLE>

7
<PAGE>

<TABLE>
<S> <C>
Senior Vice President -Paula R. David
Senior Vice President -Gary S. MacDonald
Senior Vice President -Judith K. Benson
Chairman and Director -William J. Nutt
</TABLE>

Item 28. Location of Accounts and Records
--------------------------------

(1) Munder Capital Management, 480 Pierce Street or 255 East Brown
Street, Birmingham, Michigan 48009 (records relating to its functions
as investment advisor);

(2) Funds Distributor, Inc., 60 State Street, Boston, Massachusetts
02109 (records relating to its functions as distributor);

(3) First Data Investor Services Group, Inc., 100 Federal Street,
Boston, Massachusetts 02110 or 4400 Computer Drive, Westborough,
Massachusetts 01581 (records relating to its functions as transfer
agent); and

(4) State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02110 (records relating to its functions as
administrator and custodian).

Item 29. Management Services
-------------------

Not Applicable.

Item 30. Undertakings
------------
Not Applicable.

8
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, and
the Investment Company Act of 1940, as amended, the Registrant has duly caused
this Post-Effective Amendment No. 28 to the Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Boston and The Commonwealth of Massachusetts, on the 27th day of August, 1999.

THE MUNDER FUNDS TRUST

By: *
-----------------------
Lee P. Munder, President

* By: /s/ Cynthia Surprise
--------------------
Cynthia Surprise
as Attorney-in-Fact

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended,
this Post-Effective Amendment No. 28 to the Registration Statement has been
signed below by the following persons in the capacities and on the date
indicated:
<TABLE>
<CAPTION>

Signatures Title Date
- ---------- ----- ----
<S> <C> <C>

* Trustee and August 27, 1999
------------------- President
Lee P. Munder

* Trustee August 27, 1999
-------------------
Charles W. Elliott

* Trustee August 27, 1999
-------------------
Joseph E. Champagne

* Trustee August 27, 1999
-------------------
Thomas B. Bender

* Trustee August 27, 1999
-------------------
Thomas D. Eckert

* Trustee August 27, 1999
-------------------
John Rakolta, Jr.

* Trustee August 27, 1999
-------------------
David J. Brophy

</TABLE>

9
<PAGE>

<S> <C> <C>
*_____________________ Vice President, August 27, 1999
Terry H. Gardner Treasurer, Secretary
and Chief Financial Officer
</TABLE>

*By: /s/ Cynthia Surprise
--------------------
Cynthia Surprise
as Attorney-in-Fact

10
<PAGE>

EXHIBIT INDEX

Exhibit No Description
- ---------- -----------
<S> <C>
99(g)(1) Custodian Agreement between Registrant and State Street Bank and Trust Company

99(h)(8) Amendment, dated March 16, 1999 to Transfer Agency and Registrar Agreement between
Registrant and First Data Investor Services Group, Inc.

99(h)(9) Amendment, dated March 26, 1999 to Transfer Agency and Registrar Agreement between
Registrant and First Data Investor Services Group, Inc.

99(o) Second Amended and Restated Multi-Class Plan
</TABLE>

<PAGE>

Exhibit 99(g)(1)

CUSTODIAN CONTRACT
Between
THE MUNDER FUNDS TRUST
and
STATE STREET BANK AND TRUST COMPANY

Global/Series/Trust
<PAGE>

TABLE OF CONTENTS
-----------------

<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
1. Employment of Custodian and Property to be Held By It.....................1

2. Duties of the Custodian with Respect to Property of the Fund Held by
the Custodian in the United States........................................2
2.1 Holding Securities..................................................2
2.2 Delivery of Securities..............................................2
2.3 Registration of Securities..........................................4
2.4 Bank Accounts.......................................................4
2.5 Availability of Federal Funds.......................................5
2.6 Collection of Income................................................5
2.7 Payment of Fund Monies..............................................5
2.8 Liability for Payment in Advance of Receipt of Securities
Purchased...........................................................6
2.9 Appointment of Agents...............................................7
2.10 Deposit of Fund Assets in U.S. Securities System....................7
2.11 Fund Assets Held in the Custodian's Direct Paper System.............8
2.12 Segregated Account..................................................9
2.13 Ownership Certificates for Tax Purposes.............................9
2.14 Proxies.............................................................9
2.15 Communications Relating to Portfolio Securities....................10

3. The Custodian as Foreign Custody Manager.................................10
3.1 Definitions........................................................10
3.2 Delegation to the Custodian as Foreign Custody Manager.............11
3.3 Countries Covered..................................................11
3.4 Scope of Delegated Responsibilities................................12
3.4.1. Selection of Eligible Foreign Custodians...................12
3.4.2. Contracts with Eligible Foreign Custodians.................12
3.4.3. Monitoring.................................................12
3.5 Guidelines for the Exercise of Delegated Authority.................13
3.6 Standard of Care as Foreign Custody Manager of a Portfolio.........13
3.7 Reporting Requirements.............................................13
3.8 Representations with Respect to Rule 17f-5.........................13
3.9 Effective Date and Termination of the Custodian as Foreign
Custody Manager....................................................13

4. Duties of the Custodian with Respect to Property of the Portfolios Held
Outside the United States................................................14
4.1 Definitions........................................................14
</TABLE>
<PAGE>

<TABLE>
<C> <S> <C>
4.2 Holding Securities.................................................14
4.3 Foreign Securities Systems.........................................14
4.4 Transactions in Foreign Custody Account............................14
4.4.1. Delivery of Foreign Securities.............................14
4.4.2. Payment of Portfolio Monies................................15
4.4.3. Market Conditions; Market Information......................16
4.5 Registration of Foreign Securities.................................17
4.6 Bank Accounts......................................................17
4.7 Collection of Income...............................................17
4.8 Shareholder Rights.................................................17
4.9 Communications Relating to Foreign Securities......................17
4.10 Liability of Foreign Sub-Custodians and Foreign Securities Systems.18
4.11 Tax Law............................................................18
4.12 Conflict...........................................................18

5. Payments for Sales or Repurchases or Redemptions of Shares of the Fund...18

6. Proper Instructions......................................................19

7. Actions Permitted Without Express Authority..............................19

8. Evidence of Authority....................................................20

9. Duties of Custodian With Respect to the Books of Account and
Calculation of Net Asset Value and Net Income............................20

10. Records..................................................................20

11. Opinion of Fund's Independent Accountants................................21

12. Reports to Fund by Independent Public Accountants........................21

13. Compensation of Custodian................................................21

14. Responsibility of Custodian..............................................21

15. Effective Period, Termination and Amendment..............................23

16. Successor Custodian......................................................23

17. Interpretive and Additional Provisions...................................24

18. Additional Funds.........................................................24

19. Massachusetts Law to Apply...............................................25
</TABLE>
<PAGE>

<TABLE>
<C> <S> <C>
20. Prior Contracts..........................................................25

21. Reproduction of Documents................................................25

22. Shareholder Communications Election......................................25
</TABLE>
<PAGE>

CUSTODIAN CONTRACT
------------------

This Contract between The Munder Funds Trust, a business trust organized
and existing under the laws of The Commonwealth of Massachusetts, having its
principal place of business at 480 Pierce Street, Birmingham, Michigan 48009,
hereinafter called the "Fund", and State Street Bank and Trust Company, a
Massachusetts trust company, having its principal place of business at 225
Franklin Street, Boston, Massachusetts, 02110, hereinafter called the
"Custodian",

WITNESSETH:

WHEREAS, the Fund has appointed the Custodian as custodian of its assets;

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

WHEREAS, the Fund currently offers shares in fourteen series, 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 Tax-Free Bond Fund, Munder Small
Company Growth Fund, Munder Tax-Free Bond Fund, Munder Tax-Free Short-
Intermediate Bond Fund, Munder Tax-Free Money Market Fund, Munder U.S.
Government Income Fund, and Munder U.S. Treasury Money Market Fund (such series
together with all other series subsequently established by the Fund and made
subject to this Contract in accordance with paragraph 18, being herein referred
to as the "Portfolio(s)");

NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:

1. Employment of Custodian and Property to be Held by It
-----------------------------------------------------

The Fund hereby employs the Custodian as the custodian of the assets of the
Portfolios of the Fund, including securities which the Fund, on behalf of the
applicable Portfolio desires to be held in places within the United States
("domestic securities") and securities it desires to be held outside the United
States ("foreign securities") pursuant to the provisions of the Declaration of
Trust. The Fund on behalf of the Portfolio(s) agrees to deliver to the Custodian
all securities and cash of the Portfolios, and all payments of income, payments
of principal or capital distributions received by it with respect to all
securities owned by the Portfolio(s) from time to time, and the cash
consideration received by it for such new or treasury shares of beneficial
interest of the Fund representing interests in the Portfolios, ("Shares") as may
be issued or sold from time to time. The Custodian shall not be responsible for
any property of a Portfolio held or received by the Portfolio and not delivered
to the Custodian.

Upon receipt of "Proper Instructions" (within the meaning of Article 6),
the Custodian shall on behalf of the applicable Portfolio(s) from time to time
employ one or more sub-custodians, located in the United States but only in
accordance with an applicable vote by the Board of Trustees
<PAGE>

of the Fund on behalf of the applicable Portfolio(s), and provided that the
Custodian shall have no more or less responsibility or liability to the Fund on
account of any actions or omissions of any sub-custodian so employed than any
such sub-custodian has to the Custodian. The Custodian may employ as sub-
custodian for the Fund's foreign securities on behalf of the applicable
Portfolio(s) the foreign banking institutions and foreign securities
depositories designated in Schedules A and B hereto but only in accordance with
the applicable provisions of Articles 3 and 4.

2. Duties of the Custodian with Respect to Property of the Fund Held By the
------------------------------------------------------------------------
Custodian in the United States
------------------------------

2.1 Holding Securities. The Custodian shall hold and physically segregate for
the account of each Portfolio all non-cash property, to be held by it in
the United States including all domestic securities owned by such
Portfolio, other than (a) securities which are maintained pursuant to
Section 2.10 in a clearing agency which acts as a securities depository or
in a book-entry system authorized by the U.S. Department of the Treasury
(each, a "U.S. Securities System") and (b) commercial paper of an issuer
for which State Street Bank and Trust Company acts as issuing and paying
agent ("Direct Paper") which is deposited and/or maintained in the Direct
Paper System of the Custodian (the "Direct Paper System") pursuant to
Section 2.11.

2.2 Delivery of Securities. The Custodian shall release and deliver domestic
securities owned by a Portfolio held by the Custodian or in a U.S.
Securities System account of the Custodian or in the Custodian's Direct
Paper book entry system account ("Direct Paper System Account") only upon
receipt of Proper Instructions from the Fund on behalf of the applicable
Portfolio, which may be continuing instructions when deemed appropriate by
the parties, and only in the following cases:

1) Upon sale of such securities for the account of the Portfolio and
receipt of payment therefor;

2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Portfolio;

3) In the case of a sale effected through a U.S. Securities System, in
accordance with the provisions of Section 2.10 hereof;

4) To the depository agent in connection with tender or other similar
offers for securities of the Portfolio;

5) To the issuer thereof or its agent when such securities are called,
redeemed, retired or otherwise become payable; provided that, in any
such case, the cash or other consideration is to be delivered to the
Custodian;

6) To the issuer thereof, or its agent, for transfer into the name of the
Portfolio or into the name of any nominee or nominees of the Custodian
or into the name or nominee

2.
<PAGE>

name of any agent appointed pursuant to Section 2.9 or into the name
or nominee name of any sub-custodian appointed pursuant to Article 1;
or for exchange for a different number of bonds, certificates or other
evidence representing the same aggregate face amount or number of
units; provided that, in any such case, the new securities are to be
delivered to the Custodian;

7) Upon the sale of such securities for the account of the Portfolio, to
the broker or its clearing agent, against a receipt, for examination
in accordance with "street delivery" custom; provided that in any such
case, the Custodian shall have no responsibility or liability for any
loss arising from the delivery of such securities prior to receiving
payment for such securities except as may arise from the Custodian's
own negligence or willful misconduct;

8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
securities of the issuer of such securities, or pursuant to provisions
for conversion contained in such securities, or pursuant to any
deposit agreement; provided that, in any such case, the new securities
and cash, if any, are to be delivered to the Custodian;

9) In the case of warrants, rights or similar securities, the surrender
thereof in the exercise of such warrants, rights or similar securities
or the surrender of interim receipts or temporary securities for
definitive securities; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the Custodian;

10) For delivery in connection with any loans of securities made by the
Portfolio, but only against receipt of adequate collateral as agreed
upon from time to time by the Custodian and the Fund on behalf of the
Portfolio, which may be in the form of cash or obligations issued by
the United States government, its agencies or instrumentalities,
except that in connection with any loans for which collateral is to be
credited to the Custodian's account in the book-entry system
authorized by the U.S. Department of the Treasury, the Custodian will
not be held liable or responsible for the delivery of securities owned
by the Portfolio prior to the receipt of such collateral;

11) For delivery as security in connection with any borrowings by the Fund
on behalf of the Portfolio requiring a pledge of assets by the Fund on
behalf of the Portfolio, but only against receipt of amounts borrowed;

12) For delivery in accordance with the provisions of any agreement among
the Fund on behalf of the Portfolio, the Custodian and a broker-dealer
registered under the Securities Exchange Act of 1934 (the "Exchange
Act") and a member of The National Association of Securities Dealers,
Inc. ("NASD"), relating to compliance with the rules of The Options
Clearing Corporation and of any registered national securities
exchange, or of any similar organization or organizations, regarding

3.
<PAGE>

escrow or other arrangements in connection with transactions by the
Portfolio of the Fund;

13) For delivery in accordance with the provisions of any agreement among
the Fund on behalf of the Portfolio, the Custodian, and a Futures
Commission Merchant registered under the Commodity Exchange Act,
relating to compliance with the rules of the Commodity Futures Trading
Commission and/or any Contract Market, or any similar organization or
organizations, regarding account deposits in connection with
transactions by the Portfolio of the Fund;

14) Upon receipt of instructions from the transfer agent ("Transfer
Agent") for the Fund, for delivery to such Transfer Agent or to the
holders of shares in connection with distributions in kind, as may be
described from time to time in the currently effective prospectus and
statement of additional information of the Fund, related to the
Portfolio ("Prospectus"), in satisfaction of requests by holders of
Shares for repurchase or redemption; and

15) For any other proper corporate purpose, but only upon receipt of, in
addition to Proper Instructions from the Fund on behalf of the
applicable Portfolio, a certified copy of a resolution of the Board of
Trustees or of the Executive Committee signed by an officer of the
Fund and certified by the Secretary or an Assistant Secretary,
specifying the securities of the Portfolio to be delivered, setting
forth the purpose for which such delivery is to be made, declaring
such purpose to be a proper corporate purpose, and naming the person
or persons to whom delivery of such securities shall be made.

2.3 Registration of Securities. Domestic securities held by the Custodian
(other than bearer securities) shall be registered in the name of the
Portfolio or in the name of any nominee of the Fund on behalf of the
Portfolio or of any nominee of the Custodian which nominee shall be
assigned exclusively to the Portfolio, unless the Fund has authorized in
writing the appointment of a nominee to be used in common with other
registered investment companies having the same investment adviser as the
Portfolio, or in the name or nominee name of any agent appointed pursuant
to Section 2.9 or in the name or nominee name of any sub-custodian
appointed pursuant to Article 1. All securities accepted by the Custodian
on behalf of the Portfolio under the terms of this Contract shall be in
"street name" or other good delivery form. If, however, the Fund directs
the Custodian to maintain securities in "street name", the Custodian shall
utilize its best efforts only to timely collect income due the Fund on such
securities and to notify the Fund on a best efforts basis only of relevant
corporate actions including, without limitation, pendency of calls,
maturities, tender or exchange offers.

2.4 Bank Accounts. The Custodian shall open and maintain a separate bank
account or accounts in the United States in the name of each Portfolio of
the Fund, subject only to draft or order by the Custodian acting pursuant
to the terms of this Contract, and shall hold in such account or accounts,
subject to the provisions hereof, all cash received by it from or for

4.
<PAGE>

the account of the Portfolio, other than cash maintained by the Portfolio
in a bank account established and used in accordance with Rule 17f-3 under
the Investment Company Act of 1940. Funds held by the Custodian for a
Portfolio may be deposited by it to its credit as Custodian in the Banking
Department of the Custodian or in such other banks or trust companies as it
may in its discretion deem necessary or desirable; provided, however, that
every such bank or trust company shall be qualified to act as a Custodian
under the Investment Company Act of 1940 and that each such bank or trust
company and the funds to be deposited with each such bank or trust company
shall on behalf of each applicable Portfolio be approved by vote of a
majority of the Board of Trustees of the Fund. Such funds shall be
deposited by the Custodian in its capacity as Custodian and shall be
withdrawable by the Custodian only in that capacity.

2.5 Availability of Federal Funds. Upon mutual agreement between the Fund on
behalf of each applicable Portfolio and the Custodian, the Custodian shall,
upon the receipt of Proper Instructions from the Fund on behalf of a
Portfolio, make federal funds available to such Portfolio as of specified
times agreed upon from time to time by the Fund and the Custodian in the
amount of checks received in payment for Shares of such Portfolio which are
deposited into the Portfolio's account.

2.6 Collection of Income. Subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other payments
with respect to registered domestic securities held hereunder to which each
Portfolio shall be entitled either by law or pursuant to custom in the
securities business, and shall collect on a timely basis all income and
other payments with respect to bearer domestic securities if, on the date
of payment by the issuer, such securities are held by the Custodian or its
agent thereof and shall credit such income, as collected, to such
Portfolio's Custodian account. Without limiting the generality of the
foregoing, the Custodian shall detach and present for payment all coupons
and other income items requiring presentation as and when they become due
and shall collect interest when due on securities held hereunder. Income
due each Portfolio on securities loaned pursuant to the provisions of
Section 2.2 (10) shall be the responsibility of the Fund. The Custodian
will have no duty or responsibility in connection therewith, other than to
provide the Fund with such information or data as may be necessary to
assist the Fund in arranging for the timely delivery to the Custodian of
the income to which the Portfolio is properly entitled.

2.7 Payment of Fund Monies. Upon receipt of Proper Instructions from the Fund
on behalf of the applicable Portfolio, which may be continuing instructions
when deemed appropriate by the parties, the Custodian shall pay out monies
of a Portfolio in the following cases only:

1) Upon the purchase of domestic securities, options, futures contracts
or options on futures contracts for the account of the Portfolio but
only (a) against the delivery of such securities or evidence of title
to such options, futures contracts or options on futures contracts to
the Custodian (or any bank, banking firm or trust company doing
business in the United States or abroad which is qualified under the
Investment Company Act of 1940, as amended, to act as a Custodian and
has been designated by the Custodian as its agent for this purpose)
registered in the name of

5.
<PAGE>

the Portfolio or in the name of a nominee of the Custodian referred to
in Section 2.3 hereof or in proper form for transfer; (b) in the case
of a purchase effected through a U.S. Securities System, in accordance
with the conditions set forth in Section 2.10 hereof; (c) in the case
of a purchase involving the Direct Paper System, in accordance with
the conditions set forth in Section 2.11; (d) in the case of
repurchase agreements entered into between the Fund on behalf of the
Portfolio and the Custodian, or another bank, or a broker-dealer which
is a member of NASD, (i) against delivery of the securities either in
certificate form or through an entry crediting the Custodian's account
at the Federal Reserve Bank with such securities or (ii) against
delivery of the receipt evidencing purchase by the Portfolio of
securities owned by the Custodian along with written evidence of the
agreement by the Custodian to repurchase such securities from the
Portfolio or (e) for transfer to a time deposit account of the Fund in
any bank, whether domestic or foreign; such transfer may be effected
prior to receipt of a confirmation from a broker and/or the applicable
bank pursuant to Proper Instructions from the Fund as defined in
Article 6;

2) In connection with conversion, exchange or surrender of securities
owned by the Portfolio as set forth in Section 2.2 hereof;

3) For the redemption or repurchase of Shares issued by the Portfolio as
set forth in Article 5 hereof;

4) For the payment of any expense or liability incurred by the Portfolio,
including but not limited to the following payments for the account of
the Portfolio: interest, taxes, management, accounting, transfer agent
and legal fees, and operating expenses of the Fund whether or not such
expenses are to be in whole or part capitalized or treated as deferred
expenses;

5) For the payment of any dividends on Shares of the Portfolio declared
pursuant to the governing documents of the Fund;

6) For payment of the amount of dividends received in respect of
securities sold short;

7) For any other proper purpose, but only upon receipt of, in addition to
Proper Instructions from the Fund on behalf of the Portfolio, a
certified copy of a resolution of the Board of Trustees or of the
Executive Committee of the Fund signed by an officer of the Fund and
certified by its Secretary or an Assistant Secretary, specifying the
amount of such payment, setting forth the purpose for which such
payment is to be made, declaring such purpose to be a proper purpose,
and naming the person or persons to whom such payment is to be made.

2.8 Liability for Payment in Advance of Receipt of Securities Purchased. Except
as specifically stated otherwise in this Contract, in any and every case
where payment for purchase of domestic securities for the account of a
Portfolio is made by the Custodian in advance of

6.
<PAGE>

receipt of the securities purchased in the absence of specific written
instructions from the Fund on behalf of such Portfolio to so pay in
advance, the Custodian shall be absolutely liable to the Fund for such
securities to the same extent as if the securities had been received by the
Custodian.

2.9 Appointment of Assets. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of 1940,
as amended, to act as a Custodian, as its agent to carry out such of the
provisions of this Article 2 as the Custodian may from time to time direct;
provided, however, that the appointment of any agent shall not relieve the
Custodian of its responsibilities or liabilities hereunder.

2.10 Deposit of Fund Assets in U.S. Securities Systems. The Custodian may
deposit and/or maintain securities owned by a Portfolio in a clearing
agency registered with the Securities and Exchange Commission under Section
17A of the Securities Exchange Act of 1934, which acts as a securities
depository, or in the book-entry system authorized by the U.S. Department
of the Treasury and certain federal agencies, collectively referred to
herein as "U.S. Securities System" in accordance with applicable Federal
Reserve Board and Securities and Exchange Commission rules and regulations,
if any, and subject to the following provisions:

1) The Custodian may keep securities of the Portfolio in a U.S.
Securities System provided that such securities are represented in an
account ("Account") of the Custodian in the U.S. Securities System
which shall not include any assets of the Custodian other than assets
held as a fiduciary, custodian or otherwise for customers;

2) The records of the Custodian with respect to securities of the
Portfolio which are maintained in a U.S. Securities System shall
identify by book-entry those securities belonging to the Portfolio;

3) The Custodian shall pay for securities purchased for the account of
the Portfolio upon (i) receipt of advice from the U.S. Securities
System that such securities have been transferred to the Account, and
(ii) the making of an entry on the records of the Custodian to reflect
such payment and transfer for the account of the Portfolio. The
Custodian shall transfer securities sold for the account of the
Portfolio upon (i) receipt of advice from the U.S. Securities System
that payment for such securities has been transferred to the Account,
and (ii) the making of an entry on the records of the Custodian to
reflect such transfer and payment for the account of the Portfolio.
Copies of all advices from the U.S. Securities System of transfers of
securities for the account of the Portfolio shall identify the
Portfolio, be maintained for the Portfolio by the Custodian and be
provided to the Fund at its request. Upon request, the Custodian shall
furnish the Fund on behalf of the Portfolio confirmation of each
transfer to or from the account of the Portfolio in the form of a
written advice or notice and shall furnish to the Fund on behalf of
the Portfolio copies of daily

7.
<PAGE>

transaction sheets reflecting each day's transactions in the U.S.
Securities System for the account of the Portfolio;

4) The Custodian shall provide the Fund for the Portfolio with any report
obtained by the Custodian on the U.S. Securities System's accounting
system, internal accounting control and procedures for safeguarding
securities deposited in the U.S. Securities System;

5) The Custodian shall have received from the Fund on behalf of the
Portfolio the initial or annual certificate, as the case may be,
required by Article 15 hereof;

6) Anything to the contrary in this Contract notwithstanding, the
Custodian shall be liable to the Fund for the benefit of the Portfolio
for any loss or damage to the Portfolio resulting from use of the U.S.
Securities System by reason of any negligence, misfeasance or
misconduct of the Custodian or any of its agents or of any of its or
their employees or from failure of the Custodian or any such agent to
enforce effectively such rights as it may have against the U.S.
Securities System; at the election of the Fund, it shall be entitled
to be subrogated to the rights of the Custodian with respect to any
claim against the U.S. Securities System or any other person which the
Custodian may have as a consequence of any such loss or damage if and
to the extent that the Portfolio has not been made whole for any such
loss or damage.

2.11 Fund Assets Held in the Custodian's Direct Paper System. The Custodian may
deposit and/or maintain securities owned by a Portfolio in the Direct Paper
System of the Custodian subject to the following provisions:

1) No transaction relating to securities in the Direct Paper System will
be effected in the absence of Proper Instructions from the Fund on
behalf of the Portfolio;

2) The Custodian may keep securities of the Portfolio in the Direct Paper
System only if such securities are represented in an account
("Account") of the Custodian in the Direct Paper System which shall
not include any assets of the Custodian other than assets held as a
fiduciary, custodian or otherwise for customers;

3) The records of the Custodian with respect to securities of the
Portfolio which are maintained in the Direct Paper System shall
identify by book-entry those securities belonging to the Portfolio;

4) The Custodian shall pay for securities purchased for the account of
the Portfolio upon the making of an entry on the records of the
Custodian to reflect such payment and transfer of securities to the
account of the Portfolio. The Custodian shall transfer securities sold
for the account of the Portfolio upon the making of an entry on the
records of the Custodian to reflect such transfer and receipt of
payment for the account of the Portfolio;

8.
<PAGE>

5) The Custodian shall finish the Fund on behalf of the Portfolio
confirmation of each transfer to or from the account of the Portfolio,
in the form of a written advice or notice, of Direct Paper on the next
business day following such transfer and shall finish to the Fund on
behalf of the Portfolio copies of daily transaction sheets reflecting
each day's transaction in the U.S. Securities System for the account
of the Portfolio;

6) The Custodian shall provide the Fund on behalf of the Portfolio with
any report on its system of internal accounting control as the Fund
may reasonably request from time to time.

2.12 Segregated Account. The Custodian shall upon receipt of Proper Instructions
from the Fund on behalf of each applicable Portfolio establish and maintain
a segregated account or accounts for and on behalf of each such Portfolio,
into which account or accounts may be transferred cash and/or securities,
including securities maintained in an account by the Custodian pursuant to
Section 2.10 hereof, (i) in accordance with the provisions of any
agreement among the Fund on behalf of the Portfolio, the Custodian and a
broker-dealer registered under the Exchange Act and a member of the NASD
(or any futures commission merchant registered under the Commodity Exchange
Act), relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange (or the
Commodity Futures Trading Commission or any registered contract market), or
of any similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Portfolio, (ii) for
purposes of segregating cash or government securities in connection with
options purchased, sold or written by the Portfolio or commodity futures
contracts or options thereon purchased or sold by the Portfolio, (iii) for
the purposes of compliance by the Portfolio with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release or
releases of the Securities and Exchange Commission relating to the
maintenance of segregated accounts by registered investment companies and
(iv) for other proper corporate purposes, but only, in the case of clause
(iv), upon receipt of, in addition to Proper Instructions from the Fund on
behalf of the applicable Portfolio, a certified copy of a resolution of the
Board of Trustees or of the Executive Committee signed by an officer of the
Fund and certified by the Secretary or an Assistant Secretary, setting
forth the purpose or purposes of such segregated account and declaring such
purposes to be proper corporate purposes.

2.13 Ownership Certificates for Tax Purposes. The Custodian shall execute
ownership and other certificates and affidavits for all federal and state
tax purposes in connection with receipt of income or other payments with
respect to domestic securities of each Portfolio held by it and in
connection with transfers of securities.

2.14 Proxies. The Custodian shall, with respect to the domestic securities held
hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of
the Portfolio or a nominee of the Portfolio, all

9.
<PAGE>

proxies, without indication of the manner in which such proxies are to be
voted, and shall promptly deliver to the Portfolio such proxies, all proxy
soliciting materials and all notices relating to such securities.

2.15 Communications Relating to Portfolio Securities. Subject to the provisions
of Section 2.3, the Custodian shall transmit promptly to the Fund for each
Portfolio all written information (including, without limitation, pendency
of calls and maturities of domestic securities and expirations of rights in
connection therewith and notices of exercise of call and put options
written by the Fund on behalf of the Portfolio and the maturity of futures
contracts purchased or sold by the Portfolio) received by the Custodian
from issuers of the securities being held for the Portfolio. With respect
to tender or exchange offers, the Custodian shall transmit promptly to the
Portfolio all written information received by the Custodian from issuers of
the securities whose tender or exchange is sought and from the party (or
his agents) making the tender or exchange offer. If the Portfolio desires
to take action with respect to any tender offer, exchange offer or any
other similar transaction, the Portfolio shall notify the Custodian at
least three business days prior to the date on which the Custodian is to
take such action.

3. The Custodian as Foreign Custody Manager

3.1. Definitions.

Capitalized terms in this Article 3 shall have the following meanings:

"Country Risk" means all factors reasonably related to the systemic risk of
holding Foreign Assets in a particular country including, but not limited
to, such country's political environment; economic and financial
infrastructure (including any Mandatory Securities Depositories operating
in the country); prevailing or developing custody and settlement practices;
and laws and regulations applicable to the safekeeping and recovery of
Foreign Assets held in custody in that country.

"Eligible Foreign Custodian" has the meaning set forth in section (a)(1)
of Rule 17f-5, including a majority-owned or indirect subsidiary of a U.S.
Bank (as defined in Rule 17f-5), a bank holding company meeting the
requirements of an Eligible Foreign Custodian (as set forth in Rule 17f-5
or by other appropriate action of the U.S. Securities and Exchange
Commission (the "SEC")), or a foreign branch of a Bank (as defined in
Section 2(a)(5) of the 1940 Act) meeting the requirements of a custodian
under Section 17(f) of the 1940 Act, except that the term does not include
Mandatory Securities Depositories.

"Foreign Assets" means any of the Portfolios' investments (including
foreign currencies) for which the primary market is outside the United
States and such cash and cash equivalents as are reasonably necessary to
effect the Portfolios' transactions in such investments.

"Foreign Custody Manager" has the meaning set forth in section (a)(2) of
Rule 17f-5.

10.
<PAGE>

"Mandatory Securities Depository" means a foreign securities depository or
clearing agency that, either as a legal or practical matter, must be used
if the Fund, on the Portfolio's behalf, determines to place Foreign Assets
in a country outside the United States (i) because required by law or
regulation; (ii) because securities cannot be withdrawn from such foreign
securities depository or clearing agency; or (iii) because maintaining or
effecting trades in securities outside the foreign securities depository or
clearing agency is not consistent with prevailing or developing custodial
or market practices.

3.2. Delegation to the Custodian as Foreign Custody Manager. The Fund, by
resolution adopted by its Board of Trustees, hereby delegates to the
Custodian, with respect to the Portfolios, subject to Section (b) of Rule
17f-5, the responsibilities set forth in this Article 3 with respect to
Foreign Assets of the Portfolios held outside the United States, and the
Custodian hereby accepts such delegation, as Foreign Custody Manager with
respect to the Portfolios.

3.3. Countries Covered. The Foreign Custody Manager shall be responsible for
performing the delegated responsibilities defined below only with respect
to the countries and custody arrangements for each such country listed on
Schedule A to this Contract, which list of countries may be amended from
time to time by the Fund with the agreement of the Foreign Custody Manager.
The Foreign Custody Manager shall list on Schedule A the Eligible Foreign
Custodians selected by the Foreign Custody Manager to maintain the assets
of the Portfolios which list of Eligible Foreign Custodians may be amended
from time to time in the sole discretion of the Foreign Custody Manager.
Mandatory Securities Depositories are listed on Schedule B to this
Contract, which Schedule B may be amended from time to time by the Foreign
Custody Manager. The Foreign Custody Manager will provide amended versions
of Schedules A and B in accordance with Section 3.7 of this Article 3.

Upon the receipt by the Foreign Custody Manager of Proper Instructions to
open an account or to place or maintain Foreign Assets in a country listed
on Schedule A, and the fulfillment by the Fund on behalf of the Portfolios
of the applicable account opening requirements for such country, the
Foreign Custody Manager shall be deemed to have been delegated by the Board
of Trustees on behalf of the Portfolios responsibility as Foreign Custody
Manager with respect to that country and to have accepted such delegation.
Execution of this Amendment by the Fund shall be deemed to be a Proper
Instruction to open an account, or to place or maintain Foreign Assets, in
each country listed on Schedule A in which the Custodian has previously
placed or currently maintains Foreign Assets pursuant to the terms of the
Contract. Following the receipt of Proper Instructions directing the
Foreign Custody Manager to close the account of a Portfolio with the
Eligible Foreign Custodian selected by the Foreign Custody Manager in a
designated country, the delegation by the Board of Trustees on behalf of
the Portfolios to the Custodian as Foreign Custody Manager for that country
shall be deemed to have been withdrawn and the Custodian shall immediately
cease to be the Foreign Custody Manager of the Portfolios with respect to
that country.

The Foreign Custody Manager may withdraw its acceptance of delegated
responsibilities with respect to a designated country upon written notice
to the Fund. Thirty days (or such

11.
<PAGE>

longer period as to which the parties agree in writing) after receipt of
any such notice by the Fund, the Custodian shall have no further
responsibility as Foreign Custody Manager to the Fund with respect to the
country as to which the Custodian's acceptance of delegation is withdrawn.

3.4. Scope of Delegated Responsibilities.

3.4.1. Selection of Eligible Foreign Custodians.

Subject to the provisions of this Article 3, the Portfolio's Foreign
Custody Manager may place and maintain the Foreign Assets in the care of
the Eligible Foreign Custodian selected by the Foreign Custody Manager in
each country listed on Schedule A, as amended from time to time.

In performing its delegated responsibilities as Foreign Custody Manager to
place or maintain Foreign Assets with an Eligible Foreign Custodian, the
Foreign Custody Manager shall determine that the Foreign Assets will be
subject to reasonable care, based on the standards applicable to custodians
in the country in which the Foreign Assets will be held by that Eligible
Foreign Custodian, after considering all factors relevant to the
safekeeping of such assets, including, without limitation the factors
specified in Rule 17f-5(c)(1).

3.4.2. Contracts With Eligible Foreign Custodians.

The Foreign Custody Manager shall determine that the contract (or the rules
or established practices or procedures in the case of an Eligible Foreign
Custodian that is a foreign securities depository or clearing agency)
governing the foreign custody arrangements with each Eligible Foreign
Custodian selected by the Foreign Custody Manager will satisfy the
requirements of Rule 17f-5(c)(2).

3.4.3. Monitoring.

In each case in which the Foreign Custody Manager maintains Foreign Assets
with an Eligible Foreign Custodian selected by the Foreign Custody Manager,
the Foreign Custody Manager shall establish a system to monitor (i) the
appropriateness of maintaining the Foreign Assets with such Eligible
Foreign Custodian and (ii) the contract governing the custody arrangements
established by the Foreign Custody Manager with the Eligible Foreign
Custodian (or the rules or established practices and procedures in the case
of an Eligible Foreign Custodian selected by the Foreign Custody Manager
which is a foreign securities depository or clearing agency that is not a
Mandatory Securities Depository). In the event the Foreign Custody Manager
determines that the custody arrangements with an Eligible Foreign Custodian
it has selected are no longer appropriate, the Foreign Custody Manager
shall notify the Board of Trustees in accordance with Section 3.7
hereunder.

12.
<PAGE>

3.5. Guidelines for the Exercise of Delegated Authority. For purposes of this
Article 3, the Board of Trustees shall be deemed to have considered and
determined to accept such Country Risk as is incurred by placing and
maintaining the Foreign Assets in each country for which the Custodian is
serving as Foreign Custody Manager of the Portfolios. The Fund, on behalf
of the Portfolios, and the Board of Trustees shall be deemed to be
monitoring on a continuing basis such Country Risk to the extent that the
Board of Trustees considers necessary or appropriate. The Fund and the
Custodian each expressly acknowledge that the Foreign Custody Manager shall
not be delegated any responsibilities under this Article 3 with respect to
Mandatory Securities Depositories.

3.6. Standard of Care as Foreign Custody Manager of a Portfolio. In performing
the responsibilities delegated to it, the Foreign Custody Manager agrees to
exercise reasonable care, prudence and diligence such as a person having
responsibility for the safekeeping of assets of management investment
companies registered under the 1940 Act would exercise.

3.7. Reporting Requirements. The Foreign Custody Manager shall report the
withdrawal of the Foreign Assets from an Eligible Foreign Custodian and the
placement of such Foreign Assets with another Eligible Foreign Custodian by
providing to the Board of Trustees amended Schedules A or B at the end of
the calendar quarter in which an amendment to either Schedule has occurred.
The Foreign Custody Manager shall make written reports notifying the Board
of Trustees of any other material change in the foreign custody
arrangements of the Portfolios described in this Article 3 after the
occurrence of the material change.

3.8. Representations with Respect to Rule 17f-5. The Foreign Custody Manager
represents to the Fund that it is a U.S. Bank as defined in section (a)(7)
of Rule 17f-5.

The Fund represents to the Custodian that the Board of Trustees has
determined that it is reasonable for the Board of Trustees to rely on the
Custodian to perform the responsibilities delegated pursuant to this
Contract to the Custodian as the Foreign Custody Manager of the Portfolios.

3.9. Effective Date and Termination of the Custodian as Foreign Custody Manager.
The Board of Trustees's delegation to the Custodian as Foreign Custody
Manager of the Portfolios shall be effective as of the date hereof and
shall remain in effect until terminated at any time, without penalty, by
written notice from the terminating party to the non-terminating party.
Termination will become effective thirty (30) days after receipt by the
non-terminating party of such notice. The provisions of Section 3.3 hereof
shall govern the delegation to and termination of the Custodian as Foreign
Custody Manager of the Portfolios with respect to designated countries.

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4. Duties of the Custodian with Respect to Property of the Portfolios Held
Outside the United States.

4.1. Definitions.

Capitalized terms in this Article 4 shall have the following meanings:

"Foreign Securities System" means either a clearing agency or a securities
depository listed on Schedule A hereto or a Mandatory Securities Depository
listed on Schedule B hereto.

"Foreign Sub-Custodian" means a foreign banking institution serving as an
Eligible Foreign Custodian.

4.2. Holding Securities. The Custodian shall identify on its books as belonging
to the Portfolios the foreign securities held by each Foreign Sub-Custodian
or Foreign Securities System. The Custodian may hold foreign securities for
all of its customers, including the Portfolios, with any Foreign Sub-
Custodian in an account that is identified as belonging to the Custodian
for the benefit of its customers, provided however, that (i) the records of
the Custodian with respect to foreign securities of the Portfolios which
are maintained in such account shall identify those securities as belonging
to the Portfolios and (ii), to the extent permitted and customary in the
market in which the account is maintained, the Custodian shall require that
securities so held by the Foreign Sub-Custodian be held separately from any
assets of such Foreign Sub-Custodian or of other customers of such Foreign
Sub-Custodian.

4.3. Foreign Securities Systems. Foreign securities shall be maintained in a
Foreign Securities System in a designated country only through arrangements
implemented by the Foreign Sub-Custodian in such country pursuant to the
terms of this Contract.

4.4. Transactions in Foreign Custody Account.

4.4.1. Delivery of Foreign Securities.

The Custodian or a Foreign Sub-Custodian shall release and deliver foreign
securities of the Portfolios held by such Foreign Sub-Custodian, or in a
Foreign Securities System account, only upon receipt of Proper
Instructions, which may be continuing instructions when deemed appropriate
by the parties, and only in the following cases:

(i) upon the sale of such foreign securities for the Portfolio in
accordance with commercially reasonable market practice in the country
where such foreign securities are held or traded, including, without
limitation: (A) delivery against expectation of receiving later
payment; or (B) in the case of a sale effected through a Foreign
Securities System, in accordance with the rules governing the
operation of the Foreign Securities System;

(ii) in connection with any repurchase agreement related to foreign
securities;

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<PAGE>

(iii) to the depository agent in connection with tender or other similar
offers for foreign securities of the Portfolios;

(iv) to the issuer thereof or its agent when such foreign securities are
called, redeemed, retired or otherwise become payable;

(v) to the issuer thereof, or its agent, for transfer into the name of
the Custodian (or the name of the respective Foreign Sub-Custodian
or of any nominee of the Custodian or such Foreign Sub-Custodian) or
for exchange for a different number of bonds, certificates or other
evidence representing the same aggregate face amount or number of
units;

(vi) to brokers, clearing banks or other clearing agents for examination
or trade execution in accordance with market custom; provided that
in any such case the Foreign Sub-Custodian shall have no
responsibility or liability for any loss arising from the delivery
of such securities prior to receiving payment for such securities
except as may arise from the Foreign Sub-Custodian's own negligence
or willful misconduct;

(vii) for exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of
the securities of the issuer of such securities, or pursuant to
provisions for conversion contained in such securities, or pursuant
to any deposit agreement;

(viii) in the case of warrants, rights or similar foreign securities, the
surrender thereof in the exercise of such warrants, rights or
similar securities or the surrender of interim receipts or temporary
securities for definitive securities;

(ix) for delivery as security in connection with any borrowing by the
Portfolios requiring a pledge of assets by the Portfolios;

(x) in connection with trading in options and futures contracts,
including delivery as original margin and variation margin;

(xi) in connection with the lending of foreign securities; and

(xii) for any other proper purpose, but only upon receipt of Proper
Instructions specifying the foreign securities to be delivered,
setting forth the purpose for which such delivery is to be made,
declaring such purpose to be a proper corporate purpose, and naming
the person or persons to whom delivery of such securities shall be
made.

4.4.2. Payment of Portfolio Monies.

Upon receipt of Proper Instructions, which may be continuing instructions
when deemed appropriate by the parties, the Custodian shall pay out, or
direct the respective Foreign

15.
<PAGE>

Sub-Custodian or the respective Foreign Securities System to pay out,
monies of a Portfolio in the following cases only:

(i) upon the purchase of foreign securities for the Portfolio, unless
otherwise directed by Proper Instructions, by (A) delivering money
to the seller thereof or to a dealer therefor (or an agent for such
seller or dealer) against expectation of receiving later delivery of
such foreign securities; or (B) in the case of a purchase effected
through a Foreign Securities System, in accordance with the rules
governing the operation of such Foreign Securities System;

(ii) in connection with the conversion, exchange or surrender of foreign
securities of the Portfolio;

(iii) for the payment of any expense or liability of the Portfolio,
including but not limited to the following payments: interest,
taxes, investment advisory fees, transfer agency fees, fees under
this Contract, legal fees, accounting fees, and other operating
expenses;

(iv) for the purchase or sale of foreign exchange or foreign exchange
contracts for the Portfolio, including transactions executed with or
through the Custodian or its Foreign Sub-Custodians;

(v) in connection with trading in options and futures contracts,
including delivery as original margin and variation margin;

(vi) for payment of part or all of the dividends received in respect of
securities sold short;

(vii) in connection with the borrowing or lending of foreign securities;
and

(viii) for any other proper purpose, but only upon receipt of Proper
Instructions specifying the amount of such payment, setting forth
the purpose for which such payment is to be made, declaring such
purpose to be a proper corporate purpose, and naming the person or
persons to whom such payment is to be made.

4.4.3. Market Conditions; Market Information.

Notwithstanding any provision of this Contract to the contrary, settlement
and payment for Foreign Assets received for the account of the Portfolios
and delivery of Foreign Assets maintained for the account of the Portfolios
may be effected in accordance with the customary established securities
trading or processing practices and procedures in the country or market in
which the transaction occurs, including, without limitation, delivering
Foreign Assets to the purchaser thereof or to a dealer therefor (or an
agent for such purchaser or dealer) with the expectation of receiving later
payment for such Foreign Assets from such purchaser or dealer.

16.
<PAGE>

The Custodian shall provide to the Board of Trustees the information with
respect to custody and settlement practices in countries in which the
Custodian employs a Foreign Sub-Custodian, including without limitation
information relating to Foreign Securities Systems, described on Schedule C
hereto at the time or times set forth on such Schedule. The Custodian may
revise Schedule C from time to time, provided that no such revision shall
result in the Board of Trustees being provided with substantively less
information than had been previously provided hereunder.

4.5. Registration of Foreign Securities. The foreign securities maintained in
the custody of a Foreign Sub-Custodian (other than bearer securities) shall
be registered in the name of the applicable Portfolio or in the name of the
Custodian or in the name of any Foreign Sub-Custodian or in the name of any
nominee of the foregoing, and the Fund on behalf of such Portfolio agrees
to hold any such nominee harmless from any liability as a holder of record
of such foreign securities. The Custodian or a Foreign Sub-Custodian shall
not be obligated to accept securities on behalf of a Portfolio under the
terms of this Contract unless the form of such securities and the manner in
which they are delivered are in accordance with reasonable market practice.

4.6. Bank Accounts. The Custodian shall identify on its books as belonging to
the Fund cash (including cash denominated in foreign currencies) deposited
with the Custodian. Where the Custodian is unable to maintain, or market
practice does not facilitate the maintenance of, cash on the books of the
Custodian, a bank account or bank accounts opened and maintained outside
the United States on behalf of a Portfolio with a Foreign Sub-Custodian
shall be subject only to draft or order by the Custodian or such Foreign
Sub-Custodian, acting pursuant to the terms of this Contract to hold cash
received by or from or for the account of the Portfolio.

4.7. Collection of Income. The Custodian shall use reasonable commercial efforts
to collect all income and other payments with respect to the Foreign Assets
held hereunder to which the Portfolios shall be entitled and shall credit
such income, as collected, to the applicable Portfolio. In the event that
extraordinary measures are required to collect such income, the Fund and
the Custodian shall consult as to such measures and as to the compensation
and expenses of the Custodian relating to such measures.

4.8. Shareholder Rights. With respect to the foreign securities held pursuant to
this Article 4, the Custodian will use reasonable commercial efforts to
facilitate the exercise of voting and other shareholder rights, subject
always to the laws, regulations and practical constraints that may exist in
the country where such securities are issued. The Fund acknowledges that
local conditions, including lack of regulation, onerous procedural
obligations, lack of notice and other factors may have the effect of
severely limiting the ability of the Fund to exercise shareholder rights.

4.9. Communications Relating to Foreign Securities. The Custodian shall transmit
promptly to the Fund written information (including, without limitation,
pendency of calls and maturities of foreign securities and expirations of
rights in connection therewith) received

17.
<PAGE>

by the Custodian via the Foreign Sub-Custodians from issuers of the
foreign securities being held for the account of the Portfolios. With
respect to tender or exchange offers, the Custodian shall transmit
promptly to the Fund written information so received by the Custodian
from issuers of the foreign securities whose tender or exchange is sought
or from the party (or its agents) making the tender or exchange offer.
The Custodian shall not be liable for any untimely exercise of any
tender, exchange or other right or power in connection with foreign
securities or other property of the Portfolios at any time held by it
unless (i) the Custodian or the respective Foreign Sub-Custodian is in
actual possession of such foreign securities or property and (ii) the
Custodian receives Proper Instructions with regard to the exercise of any
such right or power, and both (i) and (ii) occur at least three business
days prior to the date on which the Custodian is to take action to
exercise such right or power.

4.10. Liability of Foreign Sub-Custodians and Foreign Securities Systems. Each
agreement pursuant to which the Custodian employs a Foreign Sub-Custodian
shall, to the extent possible, require the Foreign Sub-Custodian to
exercise reasonable care in the performance of its duties and, to the
extent possible, to indemnify, and hold harmless, the Custodian from and
against any loss, damage, cost, expense, liability or claim arising out
of or in connection with the Foreign Sub-Custodian's performance of such
obligations. At the Fund's election, the Portfolios shall be entitled to
be subrogated to the rights of the Custodian with respect to any claims
against a Foreign Sub-Custodian as a consequence of any such loss,
damage, cost, expense, liability or claim if and to the extent that the
Portfolios have not been made whole for any such loss, damage, cost,
expense, liability or claim.

4.11. Tax Law. The Custodian shall have no responsibility or liability for any
obligations now or hereafter imposed on the Fund, the Portfolios or the
Custodian as custodian of the Portfolios by the tax law of the United
States or of any state or political subdivision thereof. It shall be the
responsibility of the Fund to notify the Custodian of the obligations
imposed on the Fund with respect to the Portfolios or the Custodian as
custodian of the Portfolios by the tax law of countries other than those
mentioned in the above sentence, including responsibility for withholding
and other taxes, assessments or other governmental charges,
certifications and governmental reporting. The sole responsibility of the
Custodian with regard to such tax law shall be to use reasonable efforts
to assist the Fund with respect to any claim for exemption or refund
under the tax law of countries for which the Fund has provided such
information.

4.12. Conflict. If the Custodian is delegated the responsibilities of Foreign
Custody Manager pursuant to the terms of Section 3 hereof, in the event
of any conflict between the provisions of Sections 3 and 4 hereof, the
provisions of Section 3 shall prevail

5. Payments for Sales or Repurchases or Redemptions of Shares of the Fund

The Custodian shall receive from the distributor for the Shares or from
the transfer agent of the Fund and deposit into the account of the appropriate
Portfolio such payments as are received for

18.
<PAGE>

Shares of that Portfolio issued or sold from time to time by the Fund. The
Custodian will provide timely notification to the Fund on behalf of each such
Portfolio and the transfer agent of any receipt by it of payments for Shares of
such Portfolio.

From such funds as may be available for the purpose but subject to the
limitations of the Declaration of Trust and any applicable votes of the Board of
Trustees of the Fund pursuant thereto, the Custodian shall, upon receipt of
instructions from the transfer agent, make funds available for payment to
holders of Shares who have delivered to the transfer agent a request for
redemption or repurchase of their Shares. In connection with the redemption or
repurchase of Shares of a Portfolio, the Custodian is authorized upon receipt of
instructions from the transfer agent to wire funds to or through a commercial
bank designated by the redeeming shareholders. In connection with the redemption
or repurchase of Shares of the Fund, the Custodian shall honor checks drawn on
the Custodian by a holder of Shares, which checks have been furnished by the
Fund to the holder of Shares, when presented to the Custodian in accordance with
such procedures and controls as are mutually agreed upon from time to time
between the Fund and the Custodian.

6. Proper Instructions

Proper Instructions as used throughout this Contract means a writing signed
or initialed by one or more person or persons as the Board of Trustees shall
have from time to time authorized. Each such writing shall set forth the
specific transaction or type of transaction involved, including a specific
statement of the purpose for which such action is requested. Oral instructions
will be considered Proper Instructions if the Custodian reasonably believes them
to have been given by a person authorized to give such instructions with respect
to the transaction involved. The Fund shall cause all oral instructions to be
confirmed in writing. Upon receipt of a certificate of the Secretary or an
Assistant Secretary as to the authorization by the Board of Trustees of the Fund
accompanied by a detailed description of procedures approved by the Board of
Trustees, Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the Board of
Trustees and the Custodian are satisfied that such procedures afford adequate
safeguards for the Portfolios' assets. For purposes of this Section, Proper
Instructions shall include instructions received by the Custodian pursuant to
any three-party agreement which requires a segregated asset account in
accordance with Section 2.12.

7. Actions Permitted without Express Authority

The Custodian may in its discretion, without express authority from the
Fund on behalf of each applicable Portfolio:

1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this
Contract, provided that all such payments shall be accounted for to
the Fund on behalf of the Portfolio;

2) surrender securities in temporary form for securities in definitive
form;

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<PAGE>

3) endorse for collection, in the name of the Portfolio, checks, drafts
and other negotiable instruments; and

4) in general, attend to all non-discretionary details in connection with
the sale, exchange, substitution, purchase, transfer and other
dealings with the securities and property of the Portfolio except as
otherwise directed by the Board of Trustees of the Fund.

8. Evidence of Authority

The Custodian shall be protected in acting upon any instructions, notice,
request, consent, certificate or other instrument or paper believed by it to be
genuine and to have been properly executed by or on behalf of the Fund. The
Custodian may receive and accept a certified copy of a vote of the Board of
Trustees of the Fund as conclusive evidence (a) of the authority of any person
to act in accordance with such vote or (b) of any determination or of any action
by the Board of Trustees pursuant to the Declaration of Trust as described in
such vote, and such vote may be considered as in full force and effect until
receipt by the Custodian of written notice to the contrary.

9. Duties of Custodian with Respect to the Books of Account and Calculation of
Net Asset Value and Net Income

The Custodian shall keep the books of account of each Portfolio and compute
the net asset value per share of the outstanding shares of each Portfolio. The
Custodian shall also calculate daily the net income of the Portfolio as
described in the Fund's currently effective prospectus related to such Portfolio
and shall advise the Fund and the transfer agent daily of the total amounts of
such net income and shall advise the transfer agent periodically of the division
of such net income among its various components. The calculations of the net
asset value per share and the daily income of each Portfolio shall be made at
the time or times described from time to time in the Fund's currently effective
prospectus related to such Portfolio.

10. Records

The Custodian shall with respect to each Portfolio create and maintain all
records relating to its activities and obligations under this Contract in such
manner as will meet the obligations of the Fund under the Investment Company Act
of 1940, with particular attention to Section 31 thereof and Rules 31a-1 and
31a-2 thereunder. All such records shall be the property of the Fund and shall
at all times during the regular business hours of the Custodian be open for
inspection by duly authorized officers, employees or agents of the Fund and
employees and agents of the Securities and Exchange Commission. The Custodian
shall, at the Fund's request, supply the Fund with a tabulation of securities
owned by each Portfolio and held by the Custodian and shall, when requested to
do so by the Fund and for such compensation as shall be agreed upon between the
Fund and the Custodian, include certificate numbers in such tabulations.

20.
<PAGE>

11. Opinion of Fund's Independent Accountant

The Custodian shall take all reasonable action, as the Fund on behalf of
each applicable Portfolio may from time to time request, to obtain from year to
year favorable opinions from the Fund's independent accountants with respect to
its activities hereunder in connection with the preparation of the Fund's Form
N-lA, and Form N-SAR or other annual reports to the SEC and with respect to any
other requirements thereof.

12. Reports to Fund by Independent Public Accountants

The Custodian shall provide the Fund, on behalf of each of the Portfolios
at such times as the Fund may reasonably require, with reports by independent
public accountants on the accounting system, internal accounting control and
procedures for safeguarding securities, futures contracts and options on futures
contracts, including securities deposited and/or maintained in a Securities
System, relating to the services provided by the Custodian under this Contract;
such reports, shall be of sufficient scope and in sufficient detail, as may
reasonably be required by the Fund to provide reasonable assurance that any
material inadequacies would be disclosed by such examination, and, if there are
no such inadequacies, the reports shall so state.

13. Compensation of Custodian

The Custodian shall be entitled to reasonable compensation for its services
and expenses as Custodian, as agreed upon from time to time between the Fund on
behalf of each applicable Portfolio and the Custodian.

14. Responsibility of Custodian

So long as and to the extent that it is in the exercise of reasonable care,
the Custodian shall not be responsible for the title, validity or genuineness of
any property or evidence of title thereto received by it or delivered by it
pursuant to this Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably believed by it to
be genuine and to be signed by the proper party or parties, including any
futures commission merchant acting pursuant to the terms of a three-party
futures or options agreement. The Custodian shall be held to the exercise of
reasonable care in carrying out the provisions of this Contract, but shall be
kept indemnified by the Fund and shall be without liability to the Fund for any
action taken or omitted by it in good faith without negligence, willful
misconduct or reckless disregard of its duties and obligations under this
Contract. It shall be entitled to rely on and may act upon advice of counsel
(who may be counsel for the Fund) on all matters, and shall be without liability
for any action reasonably taken or omitted pursuant to such advice. The
Custodian shall be without liability to the Fund and the Portfolios for any
loss, liability, claim or expense resulting from or caused by anything which is
(A) part of Country Risk (as defined in Section 3 hereof), including without
limitation nationalization, expropriation, currency restriction, or acts of war,
revolution, riots or terrorism, or (B) part of the "prevailing country risk" of
the Portfolios, as such term is used in SEC Release Nos. IC-22658;IS-1080 (May
12, 1997) or as such term or other similar terms are now or

21.
<PAGE>

in the future interpreted by the SEC or by the staff of the Division of
Investment Management thereof.

Except as may arise from the Custodian's own bad faith, negligence, willful
misconduct or reckless disregard of its duties and obligations hereunder or the
bad faith, negligence or willful misconduct or reckless disregard of the duties
and obligations of a sub-custodian or agent, the Custodian shall be without
liability to the Fund for any loss, liability, claim or expense resulting from
or caused by; (i) events or circumstances beyond the reasonable control of the
Custodian or any sub-custodian or Securities System or any agent or nominee of
any of the foregoing, including, without limitation, nationalization or
expropriation, imposition of currency controls or restrictions, the
interruption, suspension or restriction of trading on or the closure of any
securities market, power or other mechanical or technological failures or
interruptions, computer viruses or communications disruptions, acts of war or
terrorism, riots, revolutions, work stoppages, natural disasters or other
similar events or acts; (ii) errors by the Fund or the Investment Advisor in
their instructions to the Custodian provided such instructions have been in
accordance with this Contract; (iii) the insolvency of or acts or omissions by a
Securities System; (iv) any delay or failure of any broker, agent or
intermediary, central bank or other commercially prevalent payment or clearing
system to deliver to the Custodian's sub-custodian or agent securities purchased
or in the remittance or payment made in connection with securities sold; (v) any
delay or failure of any company, corporation, or other body in charge of
registering or transferring securities in the name of the Custodian, the Fund,
the Custodian's sub-custodians, nominees or agents or any consequential losses
arising out of such delay or failure to transfer such securities including non-
receipt of bonus, dividends and rights and other accretions or benefits; (vi)
delays or inability to perform its duties due to any disorder in market
infrastructure with respect to any particular security or Securities System; and
(vii) any provision of any present or future law or regulation or order of the
United States of America, or any state thereof, or any other country, or
political subdivision thereof or of any court of competent jurisdiction.

The Custodian shall be liable for the acts or omissions of a Foreign Sub-
Custodian to the same extent as set forth with respect to sub-custodians
generally in this Contract.

If the Fund on behalf of a Portfolio requires the Custodian to take any
action with respect to securities, which action involves the payment of money or
which action may, in the opinion of the Custodian, result in the Custodian or
its nominee assigned to the Fund or the Portfolio being liable for the payment
of money or incurring liability of some other form, the Fund on behalf of the
Portfolio, as a prerequisite to requiring the Custodian to take such action,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it.

If the Fund requires the Custodian, its affiliates, subsidiaries or agents,
to advance cash or securities for any purpose (including but not limited to
securities settlements, foreign exchange contracts and assumed settlement) or in
the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses, assessments, claims or liabilities in connection with
the performance of this Contract, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the applicable Portfolio shall
be security therefor to the extent thereof, and should the Fund fail

22.
<PAGE>

to repay the Custodian promptly, the Custodian shall be entitled to utilize
available cash and to dispose of such Portfolio's assets to the extent
necessary to obtain reimbursement.

The Custodian shall have no responsibility or liability for any acts or
omissions of any prior custodian, subcustodian, accounting agent or other
service provider to the Fund and shall be indemnified by the Fund against any
claims arising out of or attributable to the acts or omissions of any prior
custodian, subcustodian, accounting agent or other service provider. Without in
any way limiting the foregoing, the Custodian shall have no liability in respect
of any loss, damage or expense suffered by the Fund insofar as such loss, damage
or expense arises from the performance of the Custodian's duties hereunder in
reliance upon records that were maintained for the Fund by entities other than
the Custodian prior to the Custodian's appointment as custodian for the Fund.

In no event shall the Custodian be liable for indirect, special or
consequential damages.

15. Effective Period, Termination and Amendment

This Contract shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be terminated by
the Fund or the Custodian by an instrument in writing delivered or mailed,
postage prepaid to the other parties, such termination to take effect not sooner
than thirty (30) days after the date of such delivery or mailing; provided,
however that the Custodian shall not with respect to a Portfolio act under
Section 2.10 hereof in the absence of receipt of an initial certificate of the
Secretary or an Assistant Secretary that the Board of Trustees of the Fund has
approved the initial use of a particular Securities System by such Portfolio, as
required by Rule 17f-4 under the Investment Company Act of 1940, as amended and
that the Custodian shall not with respect to a Portfolio act under Section 2.11
hereof in the absence of receipt of an initial certificate of the Secretary or
an Assistant Secretary that the Board of Trustees has approved the initial use
of the Direct Paper System by such Portfolio; provided further, however, that
the Fund shall not amend or terminate this Contract in contravention of any
applicable federal or state regulations, or any provision of the Declaration of
Trust, and further provided, that the Fund on behalf of one or more of the
Portfolios may at any time by action of its Board of Trustees (i) substitute
another bank or trust company for the Custodian by giving notice as described
above to the Custodian, or (ii) immediately terminate this Contract in the event
of the appointment of a conservator or receiver for the Custodian by the
Comptroller of the Currency or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.

Upon termination of the Contract, the Fund on behalf of each applicable
Portfolio shall pay to the Custodian such compensation as may be due as of the
date of such termination and shall likewise reimburse the Custodian for its
costs, expenses and disbursements.

16. Successor Custodian

If a successor Custodian for the Fund, of one or more of the Portfolios
shall be appointed by the Board of Trustees of the Fund, the Custodian shall,
upon termination, deliver to such successor

23.
<PAGE>

Custodian at the office of the Custodian, duly endorsed and in the form for
transfer, all securities of each applicable Portfolio then held by it hereunder
and shall transfer to an account of the successor Custodian all of the
securities of each such Portfolio held in a Securities System.

If no such successor Custodian shall be appointed, the Custodian shall, in
like manner, upon receipt of a certified copy of a vote of the Board of Trustees
of the Fund, deliver at the office of the Custodian and transfer such
securities, funds and other properties in accordance with such vote.

In the event that no written order designating a successor Custodian or
certified copy of a vote of the Board of Trustees shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the Investment Company Act of 1940,
doing business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds and other
properties held by the Custodian on behalf of each applicable Portfolio and all
instruments held by the Custodian relative thereto and all other property held
by it under this Contract on behalf of each applicable Portfolio and to transfer
to an account of such successor Custodian all of the securities of each such
Portfolio held in any Securities System. Thereafter, such bank or trust company
shall be the successor of the Custodian under this Contract.

In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to procure the certified copy of the vote referred to or of
the Board of Trustees to appoint a successor Custodian, the Custodian shall be
entitled to fair compensation for its services during such period as the
Custodian retains possession of such securities, funds and other properties and
the provisions of this Contract relating to the duties and obligations of the
Custodian shall remain in full force and effect.

17. Interpretive and Additional Provisions

In connection with the operation of this Contract, the Custodian and the
Fund on behalf of each of the Portfolios, may from time to time agree on such
provisions interpretive of or in addition to the provisions of this Contract as
may in their joint opinion be consistent with the general tenor of this
Contract. Any such interpretive or additional provisions shall be in writing
signed by both parties and shall be annexed hereto, provided that no such
interpretive or additional provisions shall contravene any applicable federal or
state regulations or any provision of the Declaration of Trust of the Fund. No
interpretive or additional provisions made as provided in the preceding sentence
shall be deemed to be an amendment of this Contract.

18. Additional Funds

In the event that the Fund establishes one or more series of Shares in
addition to 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 Tax-Free Bond Fund,
Munder Small Company Growth Fund, Munder Tax-Free Bond Fund, Munder Tax-Free
Short-Intermediate Bond Fund, Munder Tax-Free Money

24.
<PAGE>

Market Fund, Munder U.S. Government Income Fund, and Munder U.S. Treasury Money
Market Fund with respect to which it desires to have the Custodian render
services as Custodian under the terms hereof, it shall so notify the Custodian
in writing, and if the Custodian agrees in writing to provide such services,
such series of Shares shall become a Portfolio hereunder.

19. Massachusetts Law to Apply

This Contract shall be construed and the provisions thereof interpreted
under and in accordance with laws of The Commonwealth of Massachusetts.

20. Prior Contracts

This Contract supersedes and terminates, as of the date hereof, all prior
contracts between the Fund on behalf of each of the Portfolios and the Custodian
relating to the custody of the Fund's assets.

21. Reproduction of Documents

This Contract and all schedules, exhibits, attachments and amendments
hereto may be reproduced by any photographic, photostatic, microfilm, micro-
card, miniature photographic or other similar process. The parties hereto
all/each agree that any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding, whether or not the
original is in existence and whether or not such reproduction was made by a
party in the regular course of business, and that any enlargement, facsimile or
further reproduction of such reproduction shall likewise be admissible in
evidence.

22. Shareholder Communications Election

Securities and Exchange Commission Rule 14b-2 requires banks which hold
securities for the account of customers to respond to requests by issuers of
securities for the names, addresses and holdings of beneficial owners of
securities of that issuer held by the bank unless the beneficial owner has
expressly objected to disclosure of this information. In order to comply with
the rule, the Custodian needs the Fund to indicate whether it authorizes the
Custodian to provide the Fund's name, address, and share position to requesting
companies whose securities the Fund owns. If the Fund tells the Custodian "no",
the Custodian will not provide this information to requesting companies. If the
Fund tells the Custodian "yes" or does not check either "yes" or "no" below, the
Custodian is required by the rule to treat the Fund as consenting to disclosure
of this information for all securities owned by the Fund or any funds or
accounts established by the Fund. For the Fund's protection, the Rule prohibits
the requesting company from using the Fund's name and address for any purpose
other than corporate communications. Please indicate below whether the Fund
consents or objects by checking one of the alternatives below.

YES [_] The Custodian is authorized to release the Fund's name, address,
and share positions.

NO [_] The Custodian is not authorized to release the Fund's name,
address, and share positions.

25.
<PAGE>

IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 3rd day of August, 1999.

ATTEST THE MUNDER FUNDS TRUST

By /s/ Terry H. Gardner
- ---------------------- -----------------------------
Name: Terry H. Gardner
Title: Vice President and Chief Financial Officer

ATTEST STATE STREET BANK AND TRUST COMPANY
/s/ Marc L. Parsons By /s/ Ronald E. Logue
- ---------------------- -----------------------------
Marc L. Parsons Ronald E. Logue
Associate Counsel Vice Chairman

<PAGE>

Exhibit 99h(8)
AMENDMENT TO THE
TRANSFER AGENCY AND REGISTRAR AGREEMENT

THIS AMENDMENT, dated as of March 16, 1999 is made to the Transfer Agency
Agreement[s] (the "Agreement[s]") between each of the Funds executing this
Amendment and listed on Exhibit 1 of this Amendment attached hereto and
incorporated herein (hereinafter individually and collectively referred to as
the "Fund") and FIRST DATA INVESTOR SERVICES GROUP, INC. ("Investor Services
Group").

1. Schedule A "Transfer Agent Fees" is deleted in its entirety and the
following new Schedule A is inserted in its place

2. Schedule B "Out-Of-Pocket Expenses" is deleted in its entirety and the
following new Schedule B is inserted in its place.

3. Schedule C "Duties of the Transfer Agent" is deleted in its entirety and
the following new Schedule C is inserted in its place.

This Amendment contains the entire understanding among the parties with respect
to the transactions contemplated hereby. To the extent that any provision of
this Amendment modifies or is otherwise inconsistent with any provision of the
prior agreements and related agreements, this Amendment shall control, but the
prior agreements and all related documents shall otherwise remain in full force
and effect.

IN WITNESS WHEREOF, each party has caused this Amendment to be executed by
its duly authorized representative on the date first stated above.

FIRST DATA INVESTOR SERVICES ST. CLAIR FUNDS, INC.
GROUP, INC.

By: /s/ Debelee Goldberg By: /s/ Lisa Anne Rosen
--------------------------- ---------------------------------------

Name: Debelee Goldberg Name: Lisa Anne Rosen
------------------------- ------------------------------------

Title: SVP Title: Secretary and Assistant Treasurer
----------------------- ------------------------------------

THE MUNDER FRAMLINGTON THE MUNDER FUNDS TRUST
FUNDS TRUST

By: /s/ Lisa Anne Rosen By: /s/ Lisa Anne Rosen
--------------------------- ---------------------------------------

Name: Lisa Anne Rosen Name: Lisa Anne Rosen
------------------------ ------------------------------------

Title: Secretary and Assistant Title: Secretary and Assistant Treasurer
------------------------ ------------------------------------
Treasurer
---------

THE MUNDER FUNDS, INC.

By: Lisa Anne Rosen
---------------

Name: Lisa Anne Rosen
---------------

Title: Secretary and Assistant Treasurer
----------------------------------
<PAGE>

SCHEDULE A
TRANSFER AGENT'S FEES
---------------------

EFFECTIVE AS OF: MARCH 1, 1999

I NET NET FUND FEES:

Per Account Fee: $21.50 per open account per year
$2.00 per closed account per year

Other Fees: IRA accounts will be charged $10.00 per global
account per annum (excluding Consumer's Energy
Group)
NSCC Transaction Charge is $.15 per financial
transaction

II ALL OTHER FUNDS' FEES:

Fund Complex Minimum* $90,000 per month

Asset Based Fees 2.00 Basis Points for assets less than 5 billion
1.50 Basis Points for assets 5 billion - 9 billion
1.51 Basis Points for assets greater than 9 billion

Other Fees: IRA accounts will be charged $10.00 per global
account per annum (excluding Consumer's Energy
Group)
NSCC Transaction Charge is $.15 per financial
transaction

III SYSTEM ENHANCEMENTS:

Client defined system enhancements will be agreed
upon by the Transfer Agent and Munder Capital and
billed at a rate of $150.00 per hour. All
programming rates are subject to an annual 5%
increase after the one year anniversary of the
effective date of this Agreement.

* The Fund Complex minimum under Section II of Schedule A will apply to all
existing and any future funds offered by Munder Capital Management which are
services by the Transfer Agent with the exception of the Net Net Funds which
will be subject to the fees under Section I of Schedule A. The fees specified
herein may be adjusted at any time upon written agreement between the parties.
After March 1, 2000 the parties agree to review the fees charged for services
under this Agreement.

IV LOST SHAREHOLDER SEARCH/
REPORTING: $2.75 per account search*
The per account search fee shall be waived until
June 2000 so long as the Fund retains Keane
Tracers, Inc. ("KTI') to provide the Fund with
KTI's "in-Depth Research Program" services.
<PAGE>

V PRINT MAIL PRICING SCHEDULE FOR SPECIAL MAILINGS FOR MUNDER GROUP OF FUNDS

This pricing is based on appropriate notification (standard of 30 day
notification) and scheduling for special mailings. Scheduling requirements
include having collateral arrive at agreed upon times in advance of deadlines.
Mailings which arise with shorter time frames and turns will be billed at a
maximum premium of 50% based on turn around requirements.

Work Order:
- -----------
$30.00 per Workorder

Technical Support/Data Processing:
- ----------------------------------
$135.00 to create an admark tape
$10.00/K to zip +4 data enhance with $125.00 minimum
$80.00/hr for any data manipulation
$6.00/K combo charge

Admark & Machine Insert
- -----------------------

#10, #11, 6x9
$62/K to admark envelope and machine insert 1 piece, with $125.00
min
$2.50/K for each additional insert
$38/K to admark only with $75.00 minimum
$25.00/K hand sort
9x12
$100/K to admark envelope and machine insert 1 piece, with
$125.00 min
$5.00/K for each additional insert
$38/K to admark only with $75.00 minimum
$0.08/K for each hand insert

Admark & Hand Insert
- --------------------

#10, #11, 6x9
$0.08 for each hand insert
$25.00/K hand sort
9x12
$0.09 for each hand insert
$25.00/K hand sort

Pressure/Sensitive Labels:
- --------------------------
$0.32 each to create, affix and hand insert 1 piece, with a
$75.00 minimum
$0.08 for each hand insert
$0.10 to affix labels only
$0.10 to create labels only

Legal Drop (Semi/Annual Reports; mailing ten plus pieces)
- ---------------------------------------------------------
$150.00 / compliant legal drop per job and processing fees

Create Mailing List:
- --------------------
$0.40 per entry with $75.00 minimum

Presort Fee:
- ------------
$0.035 per piece
<PAGE>

B. PRINT MAIL Pricing Schedule For Munder Group of Funds

Daily Work (Confirms):
- ----------------------

Hand: $71/K with $50.00 minimum (includes 1 insert)
$0.07/each additional insert

Machine: 42/K with $50.00 minimum daily (includes 1 insert)
$0.01/each additional insert

Daily Checks:
- -------------

Hand: $71/K with $50.00 minimum (includes 1 insert)
$0.07/each additional insert

Machine: 42/K with $50.00 minimum daily (includes 1 insert)
$0.01/each additional insert

* There is a $3.00 charge for each 3606 Form sent.

Quarterly/Monthly Statements:
- -----------------------------

Hand: $78/K with $50.00 minimum (includes 1 insert)
$0.08/each additional insert
$125/K for intelligent inserting

Machine: 52/K with $50.00 minimum daily (includes 1 insert)
$0.01/each additional insert
$58/K for intelligent inserting

Periodic Checks (i.e. dividend, ACW):
- -------------------------------------

Hand: $91/K with $75.00 minimum (includes 1 insert)
$0.08/each additional insert

Machine: 52/K with $75.00 minimum daily (includes 1 insert)
$0.01/each additional insert

12B1/Dealer Commission Checks/Statements:
- -----------------------------------------

$0.78/each envelope with $100.00 minimum

Printing Charges: (price ranges dependent on volumes)
- ------------------------------------------------------

$0.08/per confirm/statement/page
$0.10/per check

Folding (Machine):
- ------------------

$18K

Folding (Hand):
- ---------------

$.12 each

Presort Charge:
- ---------------
<PAGE>

$0.035 per piece

Courier Charge:
- ---------------

$15.00 for each on call courier trip/or actual cost for on demand

Overnight Charge:
- -----------------

$3.50 per package service charge plus Federal Express/Airborne
charge

Inventory Storage:
- ------------------

$20.00 for each inventory location as of the 15th of the month

Inventory Receipt:
- ------------------

$20.00 for each SKU / Shipment

Hourly work; special projects, opening envelopes, etc...

$24.00 per hour

Special Pulls
- -------------

$2.50 per account pull

Boxes/Envelopes:
- ----------------

Shipping boxes $0.85 each
Oversized Envelopes $0.45 each

Forms Development/Programming Fee:
- ----------------------------------

$150.00/hour

Systems Testing:
- ----------------

$85.00/hour

Cutting Charges:
- ----------------

$10.00/K
<PAGE>

VI Miscellaneous Charges. The Fund shall be charged for the following products
and services as applicable:
. Ad hoc reports
. ad hoc SQL time
. COLD Storage
. Digital Recording
. Microfiche/microfilm production
. Magnetic media tapes and freight
Pre-Printed Stock, including business forms, certificates, envelopes,
checks and stationary
<PAGE>

SCHEDULE B
----------
OUT-OF-POCKET EXPENSES
EFFECTIVE AS OF: MARCH 1, 1999

1. Out of Pocket Expenses. The Fund shall reimburse the Transfer Agent monthly
for applicable out-of-pocket expenses, including, but not limited to the
following items:

. Postage - direct pass through to the Fund
. Telephone and telecommunication costs, including all lease, maintenance
and line costs
. proxy solicitations, mailings and tabulations
. Shipping, Certified and Overnight mail and insurance
. Terminals, communication lines, printers and other equipment and any
expenses incurred in connection with such terminals and lines
. Duplication services
. Banking Services
. Distribution and Redemption Check Issuance ($0.07 per item for PAR
System Clients)
. Courier services
. Federal Reserve charges for check clearance
. Overtime, as approved by the Fund
. Temporary staff, as approved by the Fund
. Travel and entertainment, as approved by the Fund
. Record retention, retrieval and destruction costs, including, but not
limited to exit fees charged by third party record keeping vendors
. Third party audit reviews
. Insurance

The Fund agrees that postage and mailing expenses will be paid on the day
of or prior to mailing as agreed with the Transfer Agent. In addition, the Fund
will promptly reimburse the Transfer Agent for any other unscheduled expenses
incurred by the Transfer Agent whenever the Fund and the Transfer Agent mutually
agree that such expenses are not otherwise properly borne by the Transfer Agent
as part of its duties and obligations under the Agreement.
<PAGE>

SCHEDULE C
DUTIES OF THE TRANSFER AGENT
EFFECTIVE AS OF: MARCH 1, 1999

1. Shareholder Information. The Transfer Agent or its agent shall
-----------------------
maintain a record of the number of Shares held by each holder of record which
shall include name, address, taxpayer identification and which shall indicate
whether such Shares are held in certificates or uncertificated form, and if in
certificated form shall include certificate numbers and denominations;
historical information regarding the account of each Shareholder, including
dividends and distributions paid and the date and price for all transactions on
a Shareholder's account; any stop or restraining order placed against
Shareholder's account; any correspondence relation to the current maintenance of
a Shareholder's account; information with respect to withholdings; and, any
information required in order for the Transfer Agent to perform any calculations
contemplated or required by its Agreement with the Fund. The Transfer Agent
shall keep a record of all redemption checks and dividend checks returned by
postal authorities, and shall maintain such records as are required for the Fund
to comply with the escheat laws of any State or other authority; shall keep a
record of all redemption checks and dividend checks returned by the postal
authorities for the period of time they are the Transfer Agent of record and for
any records provided by and receipt acknowledged by both parties form any prior
Transfer Agent by means of a records certification letter; otherwise the
Transfer Agent is not responsible for the said records. The Transfer Agent shall
maintain such records as are required for The Fund to comply with the escheat
laws of any state or other authority for the period they are Transfer Agent. The
Fund will be responsible for notifying and instructing the Transfer Agent to
commence the escheatment process on their behalf, for any or all states.

2. Shareholder Services. The Transfer Agent or its agent will investigate
--------------------
all inquiries from Shareholders of the Fund relating to Shareholder accounts and
will respond to all communications from Shareholders and others relating to its
duties hereunder and such other correspondence as may from time to time be
mutually agreed upon between the Transfer Agent and the Fund.

3. Share Certificates.
------------------

(a) At the expense of the Fund, it shall supply the Transfer Agent or
its agent with an adequate supply of blank share certificates to meet the
Transfer Agent or its agent's requirements therefor. Such Share certificates
shall be properly signed by facsimile. The Fund agrees that, notwithstanding the
death, resignation, or removal of any officer of the Fund whose signature
appears on such certificates, the Transfer Agent or its agent may continue to
countersign certificates which bear such signatures until otherwise directed by
Written Instructions.

(b) The Transfer Agent or its agent shall issue replacement Share
certificates in lieu of certificates which have been lost, stolen or destroyed,
upon receipt by the Transfer Agent or its agent of properly executed affidavits
and lost certificate bonds, in form satisfactory to the Transfer Agent or its
agent, with the Fund and the Transfer Agent or its agent as obligees under the
bond.

(c) The Transfer Agent or its agent shall also maintain a record of
each certificate issued and/or canceled the number of Shares represented thereby
and the holder of record. With respect to Shares held in open accounts or
uncertificated form, i.e., no certificate being issued with respect thereto, the
Transfer Agent or its agent shall maintain comparable records of the record
holders thereof, including their names addresses and taxpayer identification.
The Transfer Agent or its agent shall further maintain a stop transfer record on
lost and/or replaced certificates.

4. Mailing Communications to Shareholders; Proxy Materials. The Transfer
-------------------------------------------------------
Agent or its agent will address and mail to Shareholders of the Fund, all
communicators by the Fund to such Shareholders, including without limitation,
confirmations of purchases and sales of Company shares, monthly statements, all
reports to Shareholders, dividend and distribution notices and proxy material
for the Fund's meetings of Shareholders. In connection with meetings of
Shareholders, the Transfer Agent or its Agent will prepare Shareholder lists,
mail and certify as to the mailing of proxy materials, process and tabulate
returned proxy cards, report on proxies voted prior to meetings, act as
inspector of election at meetings and certify Shares voted at meetings.
<PAGE>

5. Sales of Shares.
---------------

(a) Issuance of Shares. Upon receipt of a purchase order from or on
------------------
behalf of an investor for the purchase of Shares and sufficient information to
enable the Transfer Agent to establish a Shareholder account (if it is a new
account) and to determine which class of Shares the investor wishes to purchase,
and after confirmation of receipt of payment in the form described in the
Prospectus relating to such Shares and shall prepare and mail the appropriate
confirmation in accordance with legal requirements.

(b) Suspension of Sale of Shares. The Transfer Agent or its agent
----------------------------
shall not be required to issue any Shares of the Fund where it has received a
Written Instruction from the Fund or official notice from any appropriate
authority that the sale of the Shares of the Fund has been suspended or
discontinued. The existence of such Written Instructions or such official notice
shall be conclusive evidence of the right of the Transfer Agent or its agent to
rely on such Written Instructions or official notice.

(c) Payment of Redemption Proceeds. The Transfer Agent shall, upon
------------------------------
receipt of the moneys paid to it by the Custodian for the redemption of Shares,
pay such moneys as are received form the Custodian, all in accordance with the
procedures described in the Written Instruction received by the Transfer Agent
from the Fund. It is understood that the Transfer Agent may arrange for the
direct payment of redemption proceeds to Shareholders by the Fund's Custodian in
accordance with such procedures and controls as are mutually agreed upon from
time to time by the Fund, the Transfer Agent and the Fund's Custodian.

The Transfer Agent shall not process or effect any redemption with
respect to Shares of the Fund after receipt by the Transfer Agent of
notification of the suspension of the determination of the net asset value of
the Fund, provided the Transfer Agent has had a reasonable time to act on such
notification.

7. Dividends.
---------

(a) Notice to Agent and Custodian. Upon the declaration of each
-----------------------------
dividend and each capital gains distribution by the Board of Directors of the
Fund with respect to Shares of the Fund, the Fund shall furnish or cause to be
furnished to the Transfer Agent or its agent a copy of a resolution of the
Fund's Board of Directors certified by the Secretary of the Fund setting forth
the date of the declaration of such dividend or distribution, the ex-dividend
date, the date of payment thereof, the record date as of which shareholders
entitled to payment shall be determined, the amount payable per Share to the
shareholders of record as of that date, the total amount payable to the Transfer
Agent or its agent on the payment date and whether such dividend or distribution
is to be paid in Shares of such class at net asset value.

On or before the payment date specified in such resolution of the
Board of Directors, the Custodian of the Fund will pay to the Transfer Agent
sufficient cash to make payment to the shareholders of record as of such payment
date.

After deducting any amount required to be withheld by any applicable
tax laws, rules and/or regulations and/or other applicable laws, the Transfer
Agent shall in accordance with the instructions in proper form from a
Shareholder and the provisions of the applicable dividend resolutions and
Prospectus issue and credit the Account of the Shareholder with Shares, or, if
the Shareholder so elects, pay such dividends or distributions in cash.

In lieu of receiving from the Fund's Custodian and paying to
Shareholders cash dividends or distributions, the Transfer Agent may arrange for
the direct payment of cash dividends and distributions to Shareholders by the
Fund's Custodian, in accordance with such procedures and controls as are
mutually agreed upon from time to time by and among the Fund, the Transfer Agent
and the Fund's Custodian.

The Transfer Agent shall prepare, file with the Internal Revenue
Services and other appropriate taxing authorities, and address and mail to
Shareholders such returns, forms and information relating to dividends and
distributions paid by the fund as are required to be so prepared, filed and
mailed by applicable laws, rules and/or resolutions. On behalf of the Fund, the
Transfer Agent shall mail certain requests for Shareholders' certifications
under penalties of perjury and pay on a timely basis to the appropriate Federal
authorities any taxes to
<PAGE>

be withheld on dividends and distributions paid by the Fund, all as required by
applicable Federal tax laws and regulations.

(b) Insufficient Funds for Payments. If the Transfer Agent or its
-------------------------------
agent does not receive sufficient cash from the Custodian to make total dividend
and/or distribution payments to all shareholders of the Fund as of the record
date, the Transfer Agent or its agent will, upon notifying the Fund, withhold
payment to all Shareholders of record as of the record date until sufficient
cash is provided to the Transfer Agent or its agent.

8. Cash Management Services. Funds received by the Transfer Agent in
------------------------
the course of performing its services hereunder will be held in bank accounts
and/or fixed income investment accounts. With respect to funds maintained in
fixed income investment accounts, the Transfer Agent shall retain any interest
generated or earned. With respect to funds maintained in bank accounts, the
Transfer Agent shall retain any excess balance credits or excess benefits earned
or generated by or associated with such bank accounts or made available by the
institution at which such bank accounts are maintained after such balance
credits or benefits are first applied towards banking service fees charged by
such institution in connection with banking services provided on behalf of the
Fund.

9. Lost Shareholders. The Transfer Agent shall perform such services
-----------------
as are required in order to comply with Rules 17a-24 and 17Ad-17 of the 34 Act
(the Lost Shareholder Rules"), including, but not limited to those set forth
below. The Transfer Agent may, in its sole discretion, use the services of a
third party to perform the some or all such services.

(a) documentation of electronic search policies and procedures;
(b) execution of required searches;
(c) creation and mailing of confirmation letters;
(d) taking receipt of returned verification forms;
(e) providing confirmed address corrections in batch via electronic
media;
(f) tracking results and maintaining data sufficient to comply with
the Lost Shareholder Rules; and
(g) preparation and submission of data required under the Lost
Shareholder Rules.

10. Cooperation with Accountants. The Transfer Agent shall cooperate
----------------------------
with the Fund's independent public accountants and shall take all reasonable
action in the performance of its obligations under its agreement with the Fund
to assure that the necessary information is made available to such accountants
for the expression of their opinions as such as may be required by the Fund from
time to time.

11. Other Services. In accordance with the Prospectus and such
--------------
procedures and controls as are mutually agreed upon from time to time by and
among the Fund, the Transfer Agent and the Fund's Custodian, the Transfer Agent
shall (a) arrange for issuance of Shares obtained through (i) transfers of funds
from Shareholder's accounts at financial institutions, (ii) a pre-authorized
check plan, if any and (iii) a right of accumulation, if any; (b) arrange for
the exchange of Shares for shares of such other funds designated by the Fund
from time to time; and (c) arrange for systematic withdrawals from the account
of a Shareholder participating in a systematic withdrawal plan, if any.
<PAGE>

Exhibit 1

Lists of Funds and Portfolios

<TABLE>
<CAPTION>
THE MUNDER FUNDS TRUST ST. CLAIR FUNDS, INC.
- ---------------------- ---------------------
<S> <C>
Munder Balanced Fund Munder Institutional S&P 500 Index Equity Fund
Munder Bond Fund Munder Institutional S&P MidCap Index Equity Fund
Munder Cash Investment Fund Munder Institutional S&P SmallCap Index
Equity Fund
Munder Growth & Income Fund Munder Institutional Short Term Treasury Fund
Munder Index 500 Fund Munder Institutional Money Market Fund
Munder Intermediate Bond Fund Liquidity Plus Money Market Fund
Munder Michigan Tax-Free Bond Fund Munder S&P 500 Index Equity Fund
Munder Small Company Growth Fund Munder S&P MidCap Index Equity Fund
Munder Tax-Free Bond Fund Munder S&P SmallCap Index Equity Fund
Munder Tax-Free Short-Intermediate Bond Fund Munder Foreign Equity Fund
Munder Tax-Free Money Market Fund Munder Aggregate Bond Index Fund
Munder U.S. Government Income Fund
Munder U.S. Treasury Money Market Fund

THE MUNDER FUNDS, INC.
- ----------------------
Munder All-Season Aggressive Fund
Munder All-Season Conservative Fund
Munder All-Season Moderate Fund
Munder Equity Selection Fund
Munder Financial Services Fund
Munder Growth Opportunities Fund
Munder International Bond Fund
Munder Micro-Cap Equity Fund
Munder Money Market Fund
Munder Multi-Season Growth Fund
Munder NetNet Fund
Munder Real Estate Equity Investment Fund
Munder Short Term Treasury Fund
Munder Small-Cap Value Fund
Munder Value Fund

THE MUNDER FRAMLINGTON FUNDS TRUST
- ----------------------------------
Munder Framlington Emerging Markets Fund
Munder Framlington Healthcare Fund
Munder Framlington International Growth Fund
Munder Framlington Global Financial Services Fund
</TABLE>

<PAGE>

Exhibit 99h(9)

AMENDMENT TO THE
TRANSFER AGENCY AND SERVICES AGREEMENT
for DAZL Services

THIS AMENDMENT, dated as of March 26, 1999 is made to the Transfer Agency
Agreement[s] (the "Agreement[s]") between each of the Funds executing this
Amendment and listed on Exhibit 1 of this Amendment attached hereto and
incorporated herein (hereinafter individually and collectively referred to as
the "Fund") and FIRST DATA INVESTOR SERVICES GROUP, INC. ("Investor Services
Group").

WITNESSETH

WHEREAS, the Fund desires to utilize Investor Services Group's proprietary
Data Access Zip Link ("DAZL") product and services and the parties desire to
document such use and the related fees with respect thereto.

NOW THEREFORE, the Fund and Investor Services Group agree that as of the
date first referenced above, the Agreement shall be amended as follows:

1. In accordance with the following terms, Investor Services Group shall,
through is proprietary DAZL product, provide the Fund and such financial
planners and investment advisors (the "FP's") which, pursuant to agreements with
the Fund, distribute shares of such funds, with online access to the Fund
(including Portfolios) and shareholder account information for the shareholders
of the Funds or such financial planners of investment advisors.

(a) Investor Services Group Responsibility. Investor Services Group shall
provide the Fund with the appropriate documentation and procedures (the
"DAZL Documentation") to enable the Fund to properly use DAZL. In addition
to and as more fully described in the DAZL Documentation, Investor Services
Group shall to run & complete data extracts after the transfer agent
nightly cycles in order to provide files to the end user i.e., financial
planner, or direct to firms based upon the profiles that the onlines
designate.

(b) Fund Responsibilities. In addition to and as may be more fully
described in the DAZL Documentation, the fund has responsibility (i) for
setting the FSR on-lines with the appropriate data in order to feed into
the DAZL extract; (ii) with respect to those FP's utilizing a 3rd party
software vendor to access information through DAZL, ensuring the vendor
provides the translation of the DAZL file to the appropriate software
package formats; (iii) for the Fund's errors and mistakes in the use of
DAZL; (iv) for the Fund's failure to use and employ DAZL in accordance with
the procedures and documentation made available by Investor Services Group;
(v) for the Fund's utilization of the control procedures set forth and
described in such user documentation; and (vi) the Fund's failure to verify
promptly or output received through use of DAZL.
<PAGE>

(c) Fees. In consideration of the DAZL services provided by Investor
Services Group hereunder, the fund shall pay to Investor Services Group the
Fees set forth in Schedule A attached hereto.

This Amendment contains the entire understanding between the parties with
respect to the transactions contemplated hereby. To the extent that any
provision of this Amendment modifies or is otherwise inconsistent with any
provision of the Transfer Agent Agreement and related agreements, this Amendment
shall control, but the Transfer Agent Agreement and all related documents shall
otherwise remain in full force and effect.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers, as of the day and year first above
written.

FIRST DATA INVESTOR SERVICES ST. CLAIR FUNDS, INC.
GROUP, INC.

By: /s/ Debelee Goldberg By: /s/ Lisa Anne Rosen
---------------------------- ----------------------------------------

Name: Debelee Goldberg Name: Lisa Anne Rosen
-------------------------- --------------------------------------

Title: SVP Title: Secretary and Assistant Treasurer
------------------------ -------------------------------------

THE MUNDER FRAMLINGTON THE MUNDER FUNDS TRUST
FUNDS TRUST

By: /s/ Lisa Anne Rosen By: /s/ Lisa Anne Rosen
---------------------------- ----------------------------------------

Name: Lisa Anne Rosen Name: Lisa Anne Rosen
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Title: Secretary and Assistant Title: Secretary and Assistant Treasurer
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Treasurer
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THE MUNDER FUNDS, INC.

By: /s/ Lisa Anne Rosen
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Name: Lisa Anne Rosen
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Title: Secretary and Assistant
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Treasurer
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<PAGE>

Schedule A

DAZL Fees

Set-up Fee: $5,000.00 (waived)

$1,000.00 per month plus $0.25 per record transmitted ($0.15/price
record)
<PAGE>

Exhibit 1

List of Funds and Portfolios

<TABLE>
<CAPTION>
THE MUNDER FUNDS TRUST ST. CLAIR FUNDS, INC.
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<S> <C>
Munder Balanced fund Munder Institutional S&P 500 Index Equity Fund
Munder Bond Fund Munder Institutional S&P MidCap Index Equity Fund
Munder Cash Investment Fund Munder Institutional S&P SmallCap Index
Equity Fund
Munder Growth & Income Fund Munder Institutional Short Term Treasury Fund
Munder Index 500 fund Munder Institutional Money Market Fund
Munder Intermediate Bond Fund Liquidity Plus Money Market Fund
Munder International Equity Fund Munder S&P 500 Index Equity Fund
Munder Michigan Tax-Free Bond Fund Munder S&P MidCap Index Equity Fund
Munder Small Company Growth Fund Munder S&P SmallCap Index Equity Fund
Munder Tax-Free Bond Fund Munder Foreign Equity Fund
Munder Tax-Free Short-Intermediate Bond Fund Munder Aggregate Bond Index Fund
Munder Tax-Free Money Market Fund
Munder U.S. Government Income Fund
Munder U.S. Treasury Money Market Fund

THE MUNDER FUNDS, INC.
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Munder All-Season Aggressive Fund
Munder All-Season Conservative Fund
Munder All-Season Moderate Fund
Munder Equity Selection Fund
Munder Financial Services Fund
Munder Growth Opportunities fund
Munder International Bond Fund
Munder Micro-Cap Equity fund
Munder Money Market Fund
Munder Multi-Season Growth Fund
Munder NetNet Fund
Munder Real Estate Equity Investment Fund
Munder Short Term Treasury Fund
Munder Small-Cap Value Fund
Munder Value Fund

<PAGE>

Exhibit 99(o)

THE MUNDER FUNDS TRUST

Second Amended and Restated Multi-Class Plan
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Introduction
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The purpose of this plan is to specify the attributes of the five classes
of shares offered by The Munder Funds Trust (the "Trust"), including the sales
loads, expense allocations, conversion feature and exchange features of each
class, as required by Rule 18f-3 under the Investment Company Act of 1940, as
amended (the "1940 Act").

Each of the Trust's investment portfolios (each, a "Fund") other than the
Cash Investment Fund, Tax-Free Money Market Fund and the U.S. Treasury Money
Market Fund (together, the "Money Market Funds") issues its shares of beneficial
interest in five classes: "Class A" shares, "Class B" shares, "Class C" shares,
"Class K" shares and "Class Y" shares. Each of the Money Market Funds issues its
shares of beneficial interest in three classes: "Class A" shares, "Class K"
shares and "Class Y" shares. Shares of each Class of a Fund shall represent an
equal pro rata interest in such Fund, and generally, shall have identical
voting, dividend, liquidation and other rights, preferences, powers,
restrictions, limitations, qualifications, and terms and conditions, except
that: (a) each Class shall have a different designation; (b) each Class may have
a different sales charge structure; (c) each Class of shares shall bear any
Class Expenses, as defined below; (d) each Class shall have exclusive voting
rights on any matter submitted to shareholders that relates solely to its
arrangement and each Class shall have separate voting rights on any matter
submitted to shareholders in which the interests of one Class differ from the
interests of any other Class; and (e) each Class may have different exchange
and/or conversion features as described below.

Allocation of Expenses
----------------------

To the extent practicable, certain expenses (other than Class Expenses as
defined below which shall be allocated more specifically), shall be subtracted
from the gross income allocated to each Class of a Fund on the basis of net
assets of each Class of the Fund. These expenses include:

(1) Expenses incurred by the Trust (for example, fees of Trustees, auditors
and legal counsel) not attributable to a particular Fund or to a particular
Class of shares of a Fund ("Trust Level Expenses"); and

(2) Expenses incurred by a Fund not attributable to any particular Class of
the Fund's shares (for example, advisory fees, custodial fees, or other expenses
relating to the management of the Fund's assets) ("Fund Expenses").

Expenses attributable to a particular Class ("Class Expenses") shall be
limited to: (i) payments made pursuant to a Service Plan, Service and
Distribution Plan or Shareholder Servicing Plan; (ii) transfer agent fees
attributable to a specific Class; (iii) printing and postage expenses relating
to preparing and distributing materials such as shareholder reports,
prospectuses and proxies to current shareholders of a specific Class; (iv) Blue
Sky fees incurred by a Class; (v) Securities and Exchange Commission
registration fees incurred by a Class; (vi) the expense of administrative
personnel and services to support the shareholders of a specific Class; (vii)
litigation or other legal expenses relating solely to one Class; and (viii)
Trustees' fees incurred as a result of issues relating solely to one Class.
Expenses in category (i) above must be allocated to the Class for which such
expenses are incurred. For all other "Class Expenses" listed in categories (ii)-
(viii) above, the President and Chief Financial Officer shall determine, subject
to Board approval or ratification, which of such categories of expenses
<PAGE>

will be treated as Class Expenses, consistent with applicable legal principles
under the Act and the Internal Revenue Code of 1986, as amended.

Therefore, expenses of a Fund shall be apportioned to each Class of shares
depending upon the nature of the expense item. Trust Level Expenses and Fund
Expenses will be allocated among the Classes of shares based on their relative
net asset values. Approved Class Expenses shall be allocated to the particular
Class to which they are attributable. In addition, certain expenses may be
allocated differently if their method of imposition changes. Thus, if a Class
Expense can no longer be attributed to a Class, it shall be charged to a Fund
for allocation among Classes, as may be appropriate; however, any additional
Class Expenses not specifically identified above which are subsequently
identified and determined to be properly allocated to one Class of shares shall
not be allocated until approved by the Board of Trustee of the Trust in light of
the requirements of the Act and the Internal Revenue Code of 1986, as amended,
any private letter rulings with respect to the Company issued by the Internal
Revenue Service.

Class A Shares
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Class A Shares of a Fund are offered at net asset value plus, for Funds
other than the Money Market Funds (the "Non-Money Market Funds"), an initial
sales charge as set forth in the then-current prospectus of the Fund. The
initial sales charge may be waived or reduced on certain types of purchases as
set forth in a Fund's then-current prospectus. A contingent deferred sales
charge may apply to certain redemptions made within a specified period as set
forth in the Fund's then-current prospectus. Class A Shares of a Non-Money
Market Fund may be exchanged for Class A Shares of another Fund of the Trust,
The Munder Framlington Funds Trust or The Munder Funds, Inc. subject to any
sales charge differential. Class A Shares of a Money Market Fund may be
exchanged for Class A, Class B or Class C Shares of another Fund of the Trust,
The Munder Framlington Funds Trust and The Munder Funds, Inc. subject to any
sales charge differential.

Class A Shares of the Funds pay a Rule 12b-1 service fee of up to 0.25%
(annualized) of the average daily net assets of a Fund's Class A Shares.
Distribution and support services provided by brokers, dealers and other
institutions may include forwarding sales literature and advertising materials
provided by the Trust's distributor; processing purchase, exchange and
redemption requests from customers placing orders with the Trust' transfer
agent; processing dividend and distribution payments from the Fund of the Trust
on behalf of customers; providing information periodically to customers showing
their positions in Class A Shares; providing sub-accounting with respect to
Class A Shares beneficially owned by customers or the information necessary for
sub-accounting; responding to inquiries from customers concerning their
investment in Class A Shares; arranging for bank wires; and providing such other
similar services as may reasonably be requested.

Class B Shares
--------------

Class B Shares of a Non-Money Market Fund are offered without an initial
sales charge but are subject to a contingent deferred sales charge payable upon
certain redemptions as set forth in the Fund's then-current prospectus. Class B
Shares of a Non-Money Market Fund may be exchanged for Class B Shares of another
fund of the Trust, The Munder Framlington Funds Trust or The Munder Funds, Inc.
subject to any sales charge differential. Exchange-acquired Class A Shares of
the Money Market Funds will be subject to a contingent deferred sales charge
upon redemption in certain circumstances described in the Funds' Prospectuses.

2
<PAGE>

Class B Shares of a Non-Money Market Fund will automatically convert to
Class A Shares of the Fund on the first business day of the month in which the
sixth anniversary of the issuance of the Class B Shares occurs. The conversion
will be effected at the relative net asset values per share of the two classes.

Class B Shares pay a Rule 12b-1 service fee up to 0.25% (annualized) and a
distribution fee of up to 0.75% (annualized) of the average daily net assets of
the relevant Fund's Class B Shares. Brokers, dealers and other institutions may
maintain Class B shareholder accounts and provide personal services to Class B
shareholders. Services relating to the sale of Class B shares may include, but
not be limited to, preparation, printing and distribution of prospectuses, sales
literature and advertising materials by the Trust's distributor, or, as
applicable, brokers, dealers or other institutions; commissions, incentive
compensation or other compensation to, and expenses of, account executives or
other employees of the Trust's distributor or brokers, dealers and other
institutions; overhead and other office expenses of the Trust's distributor
attributable to distribution or sales support activities; and opportunity costs
related to the foregoing (which may be calculated as a carrying charge on the
Trust's distributor unreimbursed expenses) incurred in connection with
distribution or sales support activities. The overhead and other office expenses
referenced above may include, without limitation, (a) the expenses of operating
the Trust's distributor's offices in connection with the sale of the Class B
Shares of the Non-Money Market Funds, including lease costs, the salaries and
employee benefit costs of administrative, operations and support personnel,
utility costs, communication costs and the costs of stationery and supplies, (b)
the costs of client sales seminars and travel related to distribution and sales
support activities, and (c) other expenses relating to distribution and sales
support activities.

Class C Shares
--------------

Class C Shares of a Non-Money Market Fund are offered at net asset value. A
contingent deferred sales charge may apply to certain redemptions made within
the first year of investing as set forth in the relevant Fund's then-current
prospectus. Class C Shares of a Non-Money Market Fund may be exchanged for Class
C Shares of another fund of the Trust, The Munder Framlington Funds Trust or The
Munder Funds, Inc. subject to any sales charge differential.

Class C Shares pay a Rule 12b-1 service fee up to 0.25% (annualized) and a
distribution fee of up to 0.75% (annualized) of the average daily net assets of
the relevant Fund's Class C Shares. Brokers, dealers and other institutions may
maintain Class C shareholder accounts and provide personal services to Class C
shareholders. Services relating to the sale of Class C shares may include, but
not be limited to, preparation, printing and distribution of prospectuses, sales
literature and advertising materials by the Trust's distributor, or, as
applicable, brokers, dealers or other institutions; commissions, incentive
compensation or other compensation to, and expenses of, account executives or
other employees of the Trust's distributor or brokers, dealers and other
institutions; overhead and other office expenses of the Trust's distributor
attributable to distribution or sales support activities; and opportunity costs
related to the foregoing (which may be calculated as a carrying charge on the
Trust's distributor unreimbursed expenses) incurred in connection with
distribution or sales support activities. The overhead and other office expenses
referenced above may include, without limitation, (a) the expenses of operating
the Trust's distributor's offices in connection with the sale of the Class C
Shares of the Non-Money Market Funds, including lease costs, the salaries and
employee benefit costs of administrative, operations and support personnel,
utility costs, communication costs and the costs of stationery and supplies, (b)
the costs of client sales seminars and travel related to distribution and sales
support activities, and (c) other expenses relating to distribution and sales
support activities.

3
<PAGE>

Class Y Shares
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Class Y Shares of a Fund are offered at net asset value. Class Y Shares of
a Fund may be exchanged for Class Y Shares of another fund of the Trust, The
Munder Framlington Funds Trust or The Munder Funds, Inc. without the imposition
of a sales charge.

Class K Shares
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Class K Shares of a Fund are offered at net asset value. Class K Shares of
a Fund may be exchanged for Class K Shares of another fund of the Trust, The
Munder Framlington Funds Trust or The Munder Funds, Inc. without the imposition
of a sales charge. Class K Shares may also be exchanged for Class A Shares of
the same Fund without the imposition of a sales charge.

Class K Shares of the Funds pay a service fee of up to 0.25% (annualized)
of the average daily net assets of a Fund's Class K Shares. Services provided by
brokers, dealers and other institutions for such service fees include:
processing purchase, exchange and redemption requests from customers and placing
orders with the Trust' transfer agent; processing dividend and distribution
payments from the Fund on behalf of customers; providing information
periodically to customers showing their positions in Class K Shares; providing
sub-accounting with respect to Class K Shares beneficially owned by customers or
the information necessary for sub-accounting; responding to inquiries from
customers concerning their investment in Class K Shares; arranging for bank
wires; and providing such other similar services as may reasonably be requested.