Lord Abbett
Growth
Opportunities Fund
1998 ANNUAL REPORT
[GRAPHIC OMITTED]
A portfolio of mid-sized
growth companies
[LOGO](R)
<PAGE>
Report to Shareholders
For the Fiscal Year Ended November 30, 1998
[PHOTO OMITTED]
/s/ Robert S. Dow
- -----------------
ROBERT S. DOW
CHAIRMAN
JANUARY 7, 1999
"...we believe that mid-cap stocks remain meaningfully undervalued relative to
large caps and we expect that the mid-cap sector will benefit in 1999 as
investors shift away from the higher valuation levels that exist in the universe
of large-cap stocks."
Lord Abbett Growth Opportunities Fund completed its fiscal year on November 30,
1998, with a net asset value of $12.58 per Class A share versus $16.18 on
November 30, 1997. The Fund's total return for the period was 5.71%.*
Formerly known as Lord Abbett Research Fund - Mid-Cap Series, Lord Abbett Growth
Opportunities Fund became available for investment to the general public on
October 15, 1998. On September 15, 1998, the Fund's shareholders voted to amend
the Fund's investment objective to enable the Fund to pursue an investment
strategy that seeks capital appreciation and focuses on growth oriented equity
securities. The Fund primarily invests in mid-sized U.S. companies and, to a
lesser extent, in multinational companies, from which Lord Abbett expects
above-average growth.
U.S. stock markets were subject to significant volatility throughout the Fund's
fiscal year. During the first half of the period stocks performed strongly,
followed by sizable downdrafts during the summer months, and a subsequent
recovery from late September through November. We believe much of the volatility
was due to investors' growing reluctance to bear risk in response to economic
and political uncertainties in Japan, the Pacific Rim, Russia and other emerging
markets, and the impact that those uncertainties might have on future U.S.
corporate earnings. A series of rate cuts initiated by the U.S. Federal Reserve
Board helped to ease investor concern later in the period. As a more optimistic
view of global economies emerged, stocks rallied with most sectors participating
in the upswing.
The Fund experienced a period of transition in September/October as we
reorganized the portfolio to account for the new growth investment strategy.
Since the transition, the Fund has performed well relative to its benchmark, the
Russell Mid-Cap Growth Index.
The current environment of low inflation levels and interest rates, paired with
Federal Reserve rate cuts, strengthens our belief that the high valuations now
seen in the U.S. equity market will extend into 1999. However, a slowing of the
U.S. economy may negatively affect corporate earnings and employment growth.
Given this scenario, we expect that the market's short-term price volatility may
be heightened as some sectors generate good earnings while others fare poorly.
Our objective of identifying mid-sized companies with histories of earnings and
revenue growth, experienced management teams and proprietary products or
services, should help the Fund to uncover strong investment opportunities, even
as U.S. economic growth slows. Furthermore, we believe that mid-cap stocks
remain meaningfully undervalued relative to large caps and we expect that the
mid-cap sector will benefit in 1999 as investors shift away from the higher
valuation levels that exist in the universe of large-cap stocks.
We are pleased that you have chosen Lord Abbett Growth Opportunities Fund as an
investment vehicle in your diversified investment plan. We appreciate the
confidence you have placed in Lord Abbett and seek to reward your trust in us
with strong performance by the Fund.
* The Fund's Class B and C shares became available for investment on October
15, 1998. Total returns for the brief period between inception of the
class and the Fund's fiscal year end were 23.72% and 23.92%, respectively.
SEC-required returns for Class B and C shares for the period, which
reflect deduction of the maximum applicable contingent deferred sales
charge at the end of the period, were 17.53% and 22.68% respectively.
Total return is the percent change in net asset value, assuming the
reinvestment of all distributions.
<PAGE>
Fund Performance
Comparison of the change in value of a $10,000 investment, 8/1/95 - 11/30/98,(1)
in Lord Abbett Growth Opportunities Fund and the unmanaged Russell Mid-Cap
Growth Index.(2)
[The following table was depicted as a bar graph in the printed material.]
Growth Opportunities Fund(3) $19,503
Russell Mid-Cap Growth Index $16,189
(1) The Fund (Class A shares) commenced operations 8/1/95.
(2) The Russell Mid-Cap Growth Index represents stocks from the Russell
Mid-Cap Index with higher price-to-book ratios and higher forecasted
growth values. The stocks are also members of the Russell 1000 Growth
Index.
(3) Reflects the reinvestment of all distributions.
SEC-Required Information
Average annual compounded returns for periods ended 12/31/98, at the Class A
maximum sales charge of 5.75%, with all distributions reinvested:
[The following table was depicted as a bar graph in the printed material.]
1 Year 6.90%
Life of Fund
(8/1/95 Inception) 19.50%
Past performance is no indication of future results. The investment return and
principal value of an investment in the Fund will fluctuate so that shares, on
any given day or when redeemed, may be worth more or less than their original
cost.
1
<PAGE>
A Note About Year 2000 Matters
As you probably know, the Fund depends on the proper functioning of computer
systems for most, if not all, aspects of its operations. Many computer systems
now in use cannot distinguish between the year 2000 (Y2K) and the year 1900, an
inability that could disrupt the services provided to the Fund.
Lord Abbett, Lord Abbett Distributor LLC, the Fund's transfer agent, the Fund's
custodian and other providers of services critical to the Fund all have advised
the Fund that they have been actively working on changes to their computer
systems to prepare for the Year 2000 and expect that their systems, and those of
their external service providers, will be adapted in time. Although the Y2K
issue is unprecedented and the process of Y2K preparedness evaluation and
systems remediation is an ongoing one, we presently believe that there will be
no material effect on the Fund and its financial statements.
Statement of Net Assets
November 30, 1998
<TABLE>
<CAPTION>
Market Value
Security Shares (Note 1a)
===========================================================================================
<C> <S> <C> <C>
Investments in
Common Stock 92.04%
===========================================================================================
Aerospace 3.48% *Orbital Sciences Corp.+ 4,300 $ 164,475
- ---------------------------------------------------------------------------------==========
Airlines 2.53% Comair Hldgs Inc. 3,900 119,438
- ---------------------------------------------------------------------------------==========
Apparel 6.61% Liz Claiborne, Inc. 1,200 40,650
*Tommy Hilfiger Corp. 3,300 199,650
Warnaco Group Inc. 2,900 71,775
Total 312,075
- ---------------------------------------------------------------------------------==========
Buildings Materials
1.95% *Royal Group Tech Ltd. 4,400 92,125
- ---------------------------------------------------------------------------------==========
Communications *Aspect Telecom Corp. 7,000 132,562
Equipment 9.57% *Ciena Corp. 1,500 25,500
*Plantronics, Inc.+ 2,800 184,100
*Qualcomm Inc. 2,000 109,750
Total 451,912
- ---------------------------------------------------------------------------------==========
Communications *Cambridge Tech Partners Inc. 6,400 133,600
Services 4.93% *Ciber Inc. 3,700 83,481
*CBT Group Pub. Ltd. 1,500 15,750
Total 232,831
- ---------------------------------------------------------------------------------==========
Computer - *Lernout & Hauspie Speech
Software 5.57% Products N.V. 3,000 121,500
*Parametric Technology Corp. 2,000 34,000
*The Learning Company Inc. 3,700 107,531
Total 263,031
- ---------------------------------------------------------------------------------==========
Drugs/Health Care *Mylan Laboratories Inc. 1,400 46,462
Products 5.81% *Nu Skin Asia Pacific Inc.
Class A 7,400 177,137
*Rexall Sundown Inc. 3,800 50,825
Total 274,424
- ---------------------------------------------------------------------------------==========
Electronics - *Quantum Corp. 8,000 177,000
Components 8.17% *Vitesse Semiconductor Corp. 4,400 156,750
*Western Digital Corp. 4,000 52,250
Total 386,000
- ---------------------------------------------------------------------------------==========
Food 2.07% Smithfield Foods Inc. 3,700 97,818
- ---------------------------------------------------------------------------------==========
Health-Care *Arterial Vascular Engineer Inc. 5,100 249,263
Products 7.53% *Biochem Pharmaceuticals Inc. 2,900 70,688
Mallinckrodt Group Inc. 1,100 35,544
Total 355,495
- ---------------------------------------------------------------------------------==========
Health-Care *Health Mgmt Assoc Inc.
Services 4.31% Class A 2,200 47,713
*Healthsouth Corp. 11,600 155,875
Total 203,588
- ---------------------------------------------------------------------------------==========
<CAPTION>
Shares Market Value
Security or Principal Amount (Note 1a)
===========================================================================================
<C> <S> <C> <C>
HealthCare
Information Sys Shared Medical
3.22% Systems Corp. 2,900 $ 151,888
- ---------------------------------------------------------------------------------==========
Miscellaneous 8.89% *Acxiom Corp. 2,300 54,338
*Blyth Industries, Inc. 1,800 61,088
*Interim Services Inc. 5,700 118,275
*Mastech Corporation 7,000 186,375
Total 420,076
- ---------------------------------------------------------------------------------==========
Printing and
Publishing .82% *Borders Group Inc. 1,600 38,800
- ---------------------------------------------------------------------------------==========
REITS & Finance .80% *Equity Office Prop. 1,500 37,687
- ---------------------------------------------------------------------------------==========
Restaurants 3.01% *Papa Johns Int'l. Inc. 2,300 96,456
*Tricon Glob. Rest. Inc. 1,000 45,563
Total 142,019
- ---------------------------------------------------------------------------------==========
Retail 2.03% *Tiffany & Co. 2,200 96,112
- ---------------------------------------------------------------------------------==========
Security Services Corrections Corp. 5,100 104,550
7.76% *Network Associates Inc. 2,000 101,750
*Verisign Inc. 4,000 160,500
Total 366,800
- ---------------------------------------------------------------------------------==========
Toys .82% Hasbro Inc. 1,100 38,569
- ---------------------------------------------------------------------------------==========
Waste Management
2.16% *Allied Waste Industries Inc. 5,000 101,875
- ---------------------------------------------------------------------------------==========
Total Investments in
Common Stock
(Cost $3,896,890) 4,347,038
===========================================================================================
Other Assets, Less Liabilities 7.96%
===========================================================================================
Short-term Baker Hughes Inc.
Investment Discount Note 5.42%
due 12/1/1998 (Cost $249,963) 250M 249,963
===========================================================================================
Cash 138,535
- ---------------------------------------------------------------------------------==========
Receivable for: Capital stock 94,089
Securities sold 32,991
Other 35,814
Total Other Assets 162,894
- ---------------------------------------------------------------------------------==========
Payable for: Securities purchased 175,060
Capital stock reacquired 260
Total Liabilities 175,320
- ---------------------------------------------------------------------------------==========
Total Other Assets,
Less Liabilities 376,072
===========================================================================================
Net Assets 100.00% $4,723,110
===========================================================================================
</TABLE>
Class A Shares-Net asset value ($4,192,182 / 333,167 shares outstanding) $12.58
Maximum offering price (Class A shares) $13.35
Class B Shares-Net asset value ($228,747 / 18,195 shares outstanding) $12.57
Class C Shares-Net asset value ($302,181 / 24,003 shares outstanding) $12.59
* Non-income producing security
+ Affiliated issuer (holdings represent 5% or more of the outstanding voting
securities).
See Notes to Financial Statements.
2
<PAGE>
Statement of Operations
<TABLE>
<CAPTION>
Investment Income For the Year Ended November 30, 1998
======================================================================================================
<S> <C> <C> <C>
Income Dividends $ 18,363
Interest 6,787
Total 25,150
--------------------------------------------------------------------------------------
Expenses Management Fee 16,316
Management Fee waived (16,316)
12b-1 distribution plan - Class A 473
12b-1 distribution plan - Class B 152
12b-1 distribution plan - Class C 116
Professional fees 6,000
Registration fees 6,000
Shareholder servicing fees 3,000
Report to shareholders 1,000
Organization 120
Other 1,080
----------
Total expenses before expenses assumed by Lord Abbett 17,941
Expenses assumed by Lord Abbett (17,200)
--------------------------------------------------------------------------------------
Total expenses 741
--------------------------------------------------------------------------------------
Net investment income 24,409
--------------------------------------------------------------------------------------
Realized and Unrealized Gain on Investments
======================================================================================================
Realized gain from investment transactions
Proceeds from sales 2,634,687
Cost of investments sold 2,401,341
--------------------------------------------------------------------------------------
Net realized gain 233,346
--------------------------------------------------------------------------------------
Unrealized appreciation of investments 64,603
- ------------------------------------------------------------------------------------------------------
Net realized and unrealized gain on investments 297,949
- ------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations $ 322,358
======================================================================================================
</TABLE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended Nov. 30,
--------------------------
Increase in Net Assets 1998 1997
======================================================================================================
<S> <C> <C> <C>
Operations Net investment income $ 24,409 $ 24,396
Net realized gain from investment transactions 233,346 211,525
Net unrealized appreciation of investments 64,603 125,042
--------------------------------------------------------------------------------------
Net increase in net assets from operations 322,358 360,963
--------------------------------------------------------------------------------------
Undistributed net investment income included in price of share transactions 1,127 (532)
- ------------------------------------------------------------------------------------------------------
Distributions to shareholders from:
Net investment income (43,200) (31,911)
Net realized gain from investment transactions (405,260) --
--------------------------------------------------------------------------------------
Total distributions (448,460) (31,911)
- ------------------------------------------------------------------------------------------------------
Capital share transactions:
Net proceeds from sale of shares 3,761,157 266,230
Net asset value of shares issued in reinvestment
of net investment income and realized gain
from investment transactions 439,363 31,148
--------------------------------------------------------------------------------------
Total 4,200,520 297,378
Cost of shares reacquired (1,024,926) (415,449)
--------------------------------------------------------------------------------------
Increase (decrease) in net assets derived from
capital share transactions 3,175,594 (118,071)
--------------------------------------------------------------------------------------
Increase in net assets 3,050,619 210,449
- ------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of year 1,672,491 1,462,042
--------------------------------------------------------------------------------------
End of year (including undistributed net investment
income of $237 and $24,451, respectively) $4,723,110 $1,672,491
======================================================================================
</TABLE>
See Notes to Financial Statements.
3
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Class A Shares
----------------------------------------------------------------
August 1, 1995
(Commencement of
Year Ended Operations) to
November 30, November 30,
Per Share Operating Performance: 1998 1997 1996 1995
===============================================================================================================================
<S> <C> <C> <C> <C>
Net asset value, beginning of period $16.18 $12.84 $10.18 $10.00
- -------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income .15 .23 .30 .10
Net realized and unrealized gain on investments .09 3.39 2.50 .08
Total from investment operations .24 3.62 2.80 .18
-------------------------------------------------------------------------------------------------------------------------
Distributions from:
Net investment income (.37) (.28) (.12) --
Net realized gain on investments (3.47) -- (.02) --
-------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $12.58 $16.18 $12.84 $10.18
- -------------------------------------------------------------------------------------------------------------------------------
Total Return(b) 5.71% 28.90% 27.81% 1.80%(d)
===============================================================================================================================
Ratios to Average Net Assets:
Expenses, including waiver and reimbursements 0.02% .00% .00% .00%(d)
Expenses, excluding waiver and reimbursements 1.60% 1.58% 2.39% 1.20%(d)
Net investment income 1.14% 1.69% 2.67% 1.04%(d)
=========================================================================================================================
<CAPTION>
Class B Shares Class C Shares
October 16, October 19,
1998(c) to 1998(c) to
November 30, November 30,
Per Share Operating Performance: 1998 1998
===============================================================================================================================
Net asset value, beginning of period $10.41 $10.70
- -------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income --(a) --(a)
Net realized and unrealized gain on investments 2.16 1.89
Total from investment operations 2.16 1.89
-------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $12.57 $12.59
- -------------------------------------------------------------------------------------------------------------------------------
Total Return(b)(d) 20.75% 17.66%
===============================================================================================================================
Ratios to Average Net Assets:(d)
Expenses, including waiver and reimbursements .13% .13%
Expenses, excluding waiver and reimbursements .34% .34%
Net investment income (.08) (.10)
=========================================================================================================================
<CAPTION>
August 1, 1995
(Commencement of
Year Ended Operations) to
November 30, November 30,
Supplemental Data For All Classes: 1998 1997 1996 1995
===============================================================================================================================
Net assets, end of period (000) $4,723 $1,672 $1,462 $ 968
Portfolio turnover rate 136.81% 52.86% 30.78% 1.55%
=========================================================================================================================
</TABLE>
(a) Amount less than $.01.
(b) Total return does not consider the effects of sales loads and assumes the
reinvestment of all distributions.
(c) Commencement of operations of respective class shares.
(d) Not annualized.
See Notes to Financial Statements.
4
<PAGE>
Notes to Financial Statements
1. Significant Accounting Policies
Lord Abbett Research Fund, Inc. (the "Company") is an open-end management
investment company incorporated under Maryland law on April 26, 1992. The
Company consists of three separate portfolios. This report covers one of the
portfolios-Lord Abbett Growth Opportunities Fund (formerly Mid-Cap Series)
("Series"). The Series is diversified as defined under the Investment Company
Act of 1940. The financial statements have been prepared in conformity with
generally accepted accounting principles which require management to make
certain estimates and assumptions at the date of the financial statements. The
following summarizes the significant accounting policies of the Series.
(a) Security valuation is determined as follows: Portfolio securities listed or
admitted to trading privileges on any national securities exchange are valued at
the last sales price on the principal securities exchange on which such
securities are traded, or, if there is no sale, at the mean between the last bid
and ask prices on such exchange, or, in the case of bonds, in the
over-the-counter market if, in the judgment of the Company's officers, that
market more accurately reflects the market value of the bonds. Securities traded
only in the over-the-counter market are valued at the mean between the last bid
and ask prices, except that securities admitted to trading on the NASDAQ
National Market System are valued at the last sales price if it is determined
that such price more accurately reflects the value of such securities.
Short-term securities are valued at amortized cost which approximates market
value. Securities for which market quotations are not available are valued at
fair value under procedures approved by the Board of Directors.
(b) It is the policy of the Series to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its taxable income. Therefore, no federal income tax provision is required.
(c) Investment transactions are accounted for on the date that the securities
are purchased or sold (trade date). Realized gains and losses from investment
transactions are calculated on the identified cost basis. Dividend income and
distributions to shareholders are recorded on the ex-dividend date. Net
investment income (other than distribution and service fees) and realized and
unrealized gains or losses are allocated to each class of shares based upon the
relative proportion of net assets at the beginning of the day.
(d) A portion of the proceeds from sales and costs of repurchases of capital
shares equivalent to the amount of distributable net investment on the date of
the transaction is credited or charged to undistributed income. Undistributed
net investment income per share is thus unaffected by sales or repurchases of
shares.
(e) The organization expenses of the Series are amortized evenly over a period
of five years.
2. Management Fee and Other Transactions with Affiliates
The Series has a management agreement with Lord, Abbett & Co. ("Lord Abbett")
pursuant to which Lord Abbett supplies the Series with investment management
services and executive and other personnel, pays the remuneration of officers,
provides office space and pays for ordinary and necessary office and clerical
expenses relating to research, statistical work and the supervision of the
Series' investment portfolio. The management fee paid is based on average daily
net assets for each month at the annual rate of 0.75 of 1% for the period
December 1, 1997 to September 14, 1998. Effective September 15, 1998, the
management fee increased to an annual rate of 0.90 of 1%. Lord Abbett waived its
management fee for the year ended November 30, 1998.
The Series has Rule 12b-1 plans and agreements (the "Class A, Class B and Class
C Plans") with Lord Abbett Distributor LLC ("Distributor"), an affiliate of Lord
Abbett. The Series makes payments to Distributor which uses or passes on such
payments to authorized institutions. Pursuant to the Class A Plan, the Series
pays Distributor (1) an annual service fee of 0.25% of the average daily net
assets of Class A shares, (2) a one-time distribution fee of up to 1% on certain
qualifying purchases and (3) a supplemental annual distribution fee of 0.10% of
the average daily net assets of Class A shares serviced by certain qualifying
institutions. Pursuant to the Class B Plan, the Series pays Distributor an
annual service distribution fee of 0.25% and 0.75%, respectively, of the average
daily net asset value of the Class B shares. Pursuant to the Class C Plan, the
Series pays Distributor (1) a service fee and a distribution fee, at the time
such shares are sold, not to exceed 0.25% and 0.75%, respectively, of the net
asset value of such shares sold and (2) at each quarter end after the first
anniversary of the sale of such shares, a service fee and a distribution fee at
an annual rate not to exceed 0.25% and 0.75%, respectively, of the average
annual net asset value of such shares outstanding. Class Y does not have a Rule
12b-1 plan.
Distributor received $4,362, representing payment of commissions on sales of
Class A shares after deducting $25,363 allowed to authorized distributors as
concessions.
Certain of the Series' officers and directors have an interest in Lord Abbett.
3. Capital
The Company has authorized 130 million shares of $.001 par value capital stock
designated as follows: Class A-50 million, Class B-30 million, Class C-20
million, Class Y-30 million. Paid in capital amounted to $4,231,307 at November
30, 1998. Prior to October 1, 1998, all outstanding shares of the Series were
held by directors and officers of the Company and by partners and employees of
Lord Abbett.
Transactions in capital stock were as follows:
Year Ended
November 30, 1998 November 30, 1997
---------------------------------------------------
Class A Shares Amount Shares Amount
- --------------------------------------------------------------------------------
Sales of shares 282,010 $ 3,261,131 17,917 $ 266,230
Shares issued to
shareholders in
reinvestment of net
investment income
and realized gain
from investment
transactions 38,922 439,363 2,556 31,148
Total 320,932 3,700,494 20,473 297,378
- --------------------------------------------------------------------------------
Shares reacquired (91,140) (1,024,908) (30,976) (415,449)
Increase 229,792 $ 2,675,586 (10,503) $(118,071)
- --------------------------------------------------------------------------------
October 16, 1998* to November 30, 1998
----------------------------------------
Class B Shares Amount
- --------------------------------------------------------------------------------
Sales of shares 18,197 $ 211,217
Shares reacquired (2) (18)
- --------------------------------------------------------------------------------
Increase 18,195 $ 211,199
- --------------------------------------------------------------------------------
<PAGE>
Notes to Financial Statements
October 19, 1998* to November 30, 1998
----------------------------------------
Class C Shares Amount
- --------------------------------------------------------------------------------
Sales of shares 24,003 $288,809
Total Increase 24,003 $288,809
- --------------------------------------------------------------------------------
* Commencement of operations of respective class shares
There was no capital stock activity for Class Y shares during the period.
4. Distributions
Distributions from net investment income and net realized gain from investment
transactions, if any, are distributed to shareholders annually. At November 30,
1998, accumulated net realized gain for the Series was $41,418.
Income and capital gain distributions are determined in accordance with income
tax regulations which may differ from methods used to determine the
corresponding income and capital gain amounts in accordance with generally
accepted accounting principles.
5. Purchases and Sales of Securities
Purchases and sales of investment securities (other than short-term investments)
for the year ended November 30, 1998 aggregated $5,065,274 and $2,634,687,
respectively.
As of November 30, 1998, net unrealized appreciation for federal income tax
purposes aggregated $450,148 of which $516,340 related to appreciated securities
and $66,192 related to depreciated securities.
The cost of investments for federal income tax purposes is substantially the
same as that used for financial reporting purposes.
6. Directors' Remuneration
The Directors of the Company associated with Lord Abbett and all officers of the
Company receive no compensation from the Company for acting as such. Outside
Directors' fees and retirement costs are allocated among all funds in the Lord
Abbett group based on net assets of each fund.
7. Line of Credit
Each Series, along with certain other funds managed by Lord Abbett, has
available a $200,000,000 unsecured revolving credit facility ("Facility"), from
a consortium of banks, to be used for temporary or emergency purposes as an
additional source of liquidity to fund redemptions of investor shares. Any
borrowings under this Facility will bear interest at current market rates as
defined in the agreement. The fee for this Facility is 0.06% per annum. There
were no loans outstanding pursuant to this Facility at November 30, 1998, nor
was the Facility utilized at any time during the year.
8. Transactions with Affiliated Companies
An affiliated company is a company in which a Series has ownership of at least
5% of the voting securities of the underlying issuer. Transactions during the
period with companies, which are affiliates, are as follows:
<TABLE>
<CAPTION>
Realized Dividend
Balance of Balance of Gain (Loss) Income
Shares Shares Market Dec. 1, Dec. 1,
Held Held Value 1997 to 1997 to
Nov. 30, Gross Gross Nov. 30, Nov. 30, Nov. 30, Nov. 30,
Affiliates 1997 Purchases Sales 1998 1998 1998 1998
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Orbital Sciences Corp. -- 4,300 -- 4,300 $164,475 $ -- $ --
- --------------------------------------------------------------------------------------------------------------------------------
Plantronics, Inc. 1,000 1,800 -- 2,800 184,100 -- --
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
9. Proxy Results (unaudited)
The Series' shareholders voted on the following proposals at the Special Meeting
of Shareholders held on September 15, 1998. Both proposals were approved. The
description of each proposal and the results of the shareholder vote are as
follows:
For Against Abstain Non-Vote
- --------------------------------------------------------------------------------
Approval of a change to
the Series investment objective 120,978,494 -- -- --
Approval of a new
Management Agreement 120,978,494 -- -- --
- --------------------------------------------------------------------------------
Independent Auditors' Report
The Board of Directors and Shareholders,
Lord Abbett Research Fund, Inc.-Growth Opportunities Fund:
We have audited the accompanying statement of net assets of Lord Abbett Research
Fund, Inc.-Growth Opportunities Fund as of November 30, 1998, the related
statement of operations for the year then ended and of changes in net assets for
each of the years in the two-year period then ended, and the financial
highlights for each of the periods presented. These financial statements and the
financial highlights are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and the
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at November
30, 1998 by correspondence with the custodian and brokers; where replies were
not received from brokers, we performed other auditing procedures. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Lord Abbett Research
Fund, Inc.-Growth Opportunities Fund at November 30, 1998, the results of its
operations, the changes in its net assets and the financial highlights for each
of the periods presented in conformity with generally accepted accounting
principles.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
New York, New York
January 8, 1999
Copyright (C) 1999 by Lord Abbett Growth Opportunities Inc. 767 Fifth Avenue,
New York, NY 10153-0203
This publication, when not used for the general information of shareholders of
Lord Abbett Growth Opportunities is to be distributed only if preceded or
accompanied by a current prospectus which includes information concerning the
Fund's Investment objective and policies, sales charges and other matters. There
is no guarantee that the forecasts contained in this publication will come to
pass. All rights reserved. Printed in the U.S.A.
LAGOF-2-1198
(1/99)
