Rule 497(e)
SEC File No. 033-48922
THE INSTITUTIONAL FUND
A MONEY MARKET FUND
PROSPECTUS - APRIL 30, 2000
[LOGOS]
The Institutional Fund is a series of the Meeder Advisor Funds.
This Prospectus gives you important information about The Institutional
Fund that you should know before you invest. Please read this Prospectus
carefully and keep it handy for future reference.
The Securities and Exchange Commission has not approved or disapproved
these securities or passed upon the adequacy of this Prospectus. Any
representation to the contrary is a criminal offense.
Meeder Advisor Funds
6000 Memorial Drive
Dublin, OH 43017
1-800-325-3539 or 614-760-2159
Fax: 614-766-6669
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TABLE OF CONTENTS
FUND OVERVIEW 1
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A look at investment goals, strategies, risks, performance and expenses
WHO MAY WANT TO INVEST 4
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Information on who may want to invest and who may not want to invest
MORE INFORMATION ABOUT THE FUND 5
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More information about the fund you should know before investing
Who Manages the Fund? 6
How is the Trust Organized? 6
How Does Taxation Affect the Fund and Its Shareholders? 7
How to Read the Financial Highlights Table 9
SHAREHOLDER MANUAL 11
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Information about account transactions and services
How to Buy Shares 11
Distribution Fees 12
How to Make Withdrawals (Redemptions) 12
Transaction Policies 15
Other Shareholder Services 15
MORE ABOUT RISK 16
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Investment Practices and Related Risks 16
Securities and Related Risks 16
Risk Glossary 17
FOR MORE INFORMATION Back Cover
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Where to learn more about the fund
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THE INSTITUTIONAL FUND (FFIXX)
INVESTMENT GOAL
The fund seeks to provide current income while maintaining a stable share
price of $1.00. To pursue this goal, the fund invests primarily in
high-quality, short-term money market instruments, such as securities
backed by the full faith and credit of the U.S. government, securities
issued by U.S. government agencies, or obligations issued by corporations
and financial institutions.
MAIN STRATEGIES
The fund invests all of its assets in The Money Market Portfolio, a master
fund having the same investment goal as the fund. See "The Fund's
Investment in a Portfolio" under "More Information about the Fund." The
Portfolio, like all money funds, follows SEC guidelines on the quality,
maturity and diversification of its investments. These guidelines are
designed to help reduce a money fund's risks so that it is more likely to
keep its share price at $1.00.
o The Portfolio only buys securities that the adviser determines
present minimal credit risks and that are rated in one of the top
two short-term rating categories or that are comparable unrated
securities in the adviser's opinion.
o The Portfolio only buys securities with remaining maturities of
397 calendar days or less and maintains a dollar-weighted average
portfolio maturity of 90 days or less.
o Generally, the Portfolio may not invest more than 5% of its total
assets in the securities of a single issuer, other than in U.S.
government securities.
o Generally, the adviser will attempt to purchase securities with
longer maturities when it believes interest rates are falling and
will attempt to purchase securities with shorter maturities when
it believes interest rates are rising.
The Portfolio will limit its purchases to U.S. government securities and
securities of its agencies and instrumentalities, bank obligations and
instruments secured thereby, high quality commercial paper, high grade
corporate obligations, funding agreements and repurchase agreements.
The fund's investment goal is not fundamental and may be changed without
shareholder approval.
For more information, see "How Does the Fund Pursue Its Investment Goal?"
under "More Information About the Fund."
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MAIN RISK FACTORS
The fund is subject to income risk, which is the possibility that the
fund's dividends or income will decline because of falling interest rates.
The fund is subject, to a limited extent, to credit risk, which is the
possibility that the issuer of a security owned by the fund will be unable
to repay interest and principal in a timely manner.
An investment in the fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. 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. Please read "More About
Risk" carefully before investing.
PERFORMANCE
The bar chart shown below provides some indication of the risks of
investing in The Institutional Fund by showing changes in the fund's
performance from year to year during the past five calendar years. The
table below compares the fund's performance with the returns of an index of
funds with similar investment objectives. How the fund has performed in the
past is not necessarily an indication of how the fund will perform in the
future.
[Plot points for Edgar format]:
YEAR ANNUAL TOTAL RETURN
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1995 6.01%
1996 5.43%
1997 5.53%
1998 5.49%
1999 5.13%
During the period shown in the bar chart, the highest return for a quarter
was 1.52% (quarter ended June 30, 1995) and the lowest return for a quarter
was 1.19% (quarter ended June 30, 1999).
The fund's seven-day yield ended on December 31, 1999 was 5.73% and the
seven-day compound yield ended December 31, 1999 was 5.88%. To request the
fund's current seven-day yield, please call 1-800-325-FLEX or 614-760-2159.
Average Annual Total Returns
(for the periods ending Since Inception
DECEMBER 31, 1999) PAST ONE YEAR PAST FIVE YEARS (6/15/94)
------------------ ------------- --------------- ---------
The Institutional Fund 5.13% 5.52% 5.46%
IBC Financial Data, Inc.'s
Average Institutional Fund 4.96% 5.34% 5.23%
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FEES AND EXPENSES OF THE FUND
The following table describes the fees and expenses that you may pay if you
buy and hold shares of the fund.
There are no sales loads, fees or other charges
o to buy fund shares directly from the fund
o to reinvest dividends in additional shares
o to exchange into shares of funds in the Flex-funds family of
no-load funds
o or to redeem your shares.
ANNUAL FUND OPERATING EXPENSES (EXPENSES THAT ARE DEDUCTED FROM FUND
ASSETS)1
Management Fees 0.26%
Distribution (12b-1) Fees 0.03%
Other Expenses2 0.16%
Total Annual Fund Operating Expenses 0.45%
Fee Waiver and Expense Reimbursement3 - 0.20%
Net Expenses 0.25%
1 This table and the Example below reflect the expenses of the fund and its
proportionate share of expenses from its corresponding Portfolio. See "The
Fund's Investment in a Portfolio" under "More Information About the Fund."
2 "Other Expenses" are based on expenses actually incurred by the fund for
the year ended December 31, 1999.
3 Reflects the adviser's contractual agreement to reduce its fees and/or
absorb expenses to the extent necessary to keep total expenses at 0.26% of
average daily net assets. The adviser may terminate this agreement after
April 30, 2001.
EXAMPLE
The example in the table below is intended to help you compare the cost of
investing in the fund with the cost of investing in other mutual funds.
Assuming you
o invest $10,000 in the fund
o redeem your shares at the end of the periods shown below
o earn a 5% return each year and
o incur the same fund operating expenses shown above,
your cost of investing in the fund would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
$26 $124 $232 $547
Of course, your actual costs may be higher or lower.
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WHO MAY WANT TO INVEST
The fund may be appropriate if you are an institutional investor who:
o likes to earn income at current money market rates while
preserving the value of your investment
o is looking for a short-term component of an asset allocation
program
o characterizes your investment outlook as "very conservative"
o wants to be able to move money into stock or bond investments
quickly and without penalty
The fund may not be appropriate if you:
o are investing for maximum return over a long-term horizon
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MORE INFORMATION ABOUT THE FUND
THE FUND'S INVESTMENT IN A PORTFOLIO
The fund seeks to achieve its investment goal by investing all of its
assets in the Money Market Portfolio, its corresponding portfolio.
The portfolio has the same investment goal as the fund. The fund's
investment policies are also substantially similar to the portfolio's,
except the fund may pursue its policies by investing in an open-end
management investment company with the same investment goal and
substantially similar policies and restrictions as the fund. The fund buys
shares of the portfolio at net asset value. An investment in the fund is an
indirect investment in the portfolio.
It is possible that the fund may withdraw its investment in the portfolio
and subsequently invest in another open-end management investment company
with the same investment goal and substantially similar policies. This
could happen if the portfolio changes its investment goal or if the board
of trustees, at any time, considers it in the fund's best interest.
The fund's structure, where it invests all of its assets in its
corresponding portfolio, is sometimes called a "master/feeder" structure.
You will find more detailed information about this structure and the
potential risks associated with it in the Statement of Additional
Information.
HOW DOES THE FUND PURSUE ITS INVESTMENT GOAL?
The manager seeks to achieve its goal by investing in high-quality money
market instruments which mature in 397 days or less. Also, the portfolio
will seek to minimize changes in the value of its assets due to market
factors by maintaining a dollar-weighted average portfolio maturity of 90
days or less.
The portfolio may change its average portfolio maturity or level of quality
to protect its net asset value when it is perceived that changes in the
liquidity of major financial institutions may adversely affect the money
markets. Consequently, for temporary defensive purposes, the portfolio may
shorten the average maturity of its investments and/or invest only in the
highest quality debt instruments, including, for example, U.S. government
or agency obligations.
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WHO MANAGES THE FUND?
THE BOARD. The board of trustees oversees the management of the fund and
the portfolio, and elects their officers. The officers are responsible for
the fund and the portfolio's day-to-day operations. Information concerning
the trustees and officers of the fund and the portfolio appears in the
Statement of Additional Information.
INVESTMENT ADVISER. Meeder Asset Management, Inc. ("Meeder"), formerly
known as R. Meeder & Associates, Inc., manages the portfolio's assets and
makes investment decisions for the portfolio. Meeder has been an investment
adviser to individuals, pension and profit sharing plans, trusts,
charitable organizations, corporations and other institutions since 1974.
In addition, Meeder has served as investment adviser to the portfolio since
its inception and, prior to that, to The Flex-funds trust since its
inception in 1982. As of December 31, 1999, Meeder and its affiliates
managed approximately $2.2 billion in assets. Meeder has its principal
offices at 6000 Memorial Drive, Dublin, OH 43017.
PORTFOLIO MANAGER
The portfolio manager responsible for the portfolio's investments is Philip
A. Voelker, Senior Vice President and Chief Investment Officer of Meeder.
Mr. Voelker joined Meeder in 1975 and has managed the portfolio since 1985.
MANAGEMENT FEES. During the calendar year ended December 31, 1999, the
portfolio paid management fees totaling 0.15% of the portfolio's average
daily net assets.
HOW IS THE TRUST ORGANIZED?
The fund is a no-load, open-end management investment company that is a
member of the Meeder Advisor Funds trust (the "Trust").
The Trust is supervised by a board of trustees, an independent body that
has ultimate responsibility for the fund's activities. The board retains
various companies to carry out the fund's operations, including the
investment adviser, custodian, transfer agent and others. The board has the
right, and the obligation, to terminate the fund's relationship with any of
these companies and to retain a different company if the board believes it
is in the shareholders' best interests. At a mutual fund's inception, the
initial shareholder (typically the adviser) appoints the fund's board.
Thereafter, the board and the shareholders determine the board's
membership. The board of the Trust may include individuals who are
affiliated with the investment adviser.
The fund does not hold annual shareholder meetings, but may hold special
meetings for such purposes as electing or removing board members, changing
fundamental policies, approving a management contract or approving a 12b-1
plan (12b-1 fees are explained in "Distribution Fees").
PORTFOLIO TRADES
As long as the advisers believe a brokerage firm can provide a combination
of quality execution (i.e., timeliness and completeness) and favorable
price, they may consider research and related services when choosing a
brokerage firm. Brokerage firms may use a portion of the commissions paid
by the portfolio to reduce it, or the fund's, expenses.
DIVERSIFICATION
The fund is diversified, which means the fund may not invest more than 5%
of its assets in the securities of one company.
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HOW DOES TAXATION AFFECT THE FUND AND ITS SHAREHOLDERS?
HOW DOES THE PORTFOLIO EARN INCOME AND GAINS?
The portfolio may earn dividends and interest (the portfolio's "income") on
its investments. When the portfolio sells a security for a price that is
higher than it paid, it has a gain. When the portfolio sells a security for
a price that is lower than it paid, it has a loss. If the portfolio has
held the security for more than one year, the gain or loss will be a
long-term capital gain or loss. If the portfolio has held the security for
one year or less, the gain or loss will be a short-term capital gain or
loss. The portfolio's gains and losses are netted together, and, if the
portfolio has a net gain (the portfolio's "gain"), that gain will generally
be distributed to you.
TAXATION OF THE PORTFOLIO'S INVESTMENTS
The portfolio invests your money in the securities that are described in
the sections "Main Strategies" and "How Does the Fund Pursue Its Investment
Goal?" Special tax rules may apply in determining the income and gains that
the portfolio earns on its investments. These rules may, in turn, affect
the amount of distributions that the fund pays to you. These special tax
rules are discussed in the Statement of Additional Information.
TAXATION OF THE FUND. As a regulated investment company, the fund generally
pays no federal income tax on the income and gains that it distributes to
you.
TAXATION OF SHAREHOLDERS
WHAT IS A DISTRIBUTION?
As a shareholder, you will receive your share of the fund's income and
gains on the portfolio's investments in money market securities. The fund's
income and short-term capital gains are paid to you as ordinary dividends.
The fund's long-term capital gains are paid to you as capital gain
distributions. If the fund pays you an amount in excess of its income and
gains, this excess will generally be treated as a non-taxable return of
capital. These amounts, taken together, are what we call the fund's
distributions to you. The fund pays dividends from its net investment
income on a monthly basis. The fund distributes capital gains, if any,
annually.
DISTRIBUTIONS. Distributions from the fund, whether you receive them in
cash or in additional shares, are generally subject to income tax. The fund
will send you a statement in January of the current year that reflects the
amount of ordinary dividends, capital gain distributions and non-taxable
distributions you received from the fund in the prior year. This statement
will include distributions declared in December and paid to you in January
of the current year, but which are taxable as if paid on December 31 of the
prior year. The Internal Revenue Service requires you to report these
amounts on your income tax return for the prior year.
DISTRIBUTIONS TO RETIREMENT PLANS. Fund distributions received by your
qualified retirement plan, such as a 401(k) plan or IRA, are generally
tax-deferred; this means that you are not required to report fund
distributions on your income tax return when paid to your plan, but,
rather, when your plan makes payments to you. Special rules apply to
payouts from Roth and Education IRAs.
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DIVIDENDS-RECEIVED DEDUCTION. Corporate investors may be entitled to a
dividends-received deduction on a portion of the ordinary dividends they
receive from the fund.
BUYING A DIVIDEND. Purchasing fund shares in a taxable account shortly
before a distribution is known as "buying a dividend." In taxable accounts,
you must pay income taxes on the distribution whether you take the
distribution in cash or reinvest it. In addition, you will have to pay
taxes on the distribution whether the value of your investment decreased,
increased or remained the same after you bought the fund shares. The risk
in buying a dividend is that the portfolio may build up taxable gains
throughout the period covered by a distribution, as securities are sold at
a profit. We distribute those gains to you, after subtracting any losses,
even if you did not own the shares when the gains occurred.
DIVIDEND REINVESTMENTS. Most investors have their dividends reinvested in
additional shares of the fund. If you choose this option, or if you do not
indicate any choice, your dividends will be reinvested on the dividend
payable date. Alternatively, you can choose to have a check for your
dividends mailed to you. However, if the check is not deliverable, your
dividends will be reinvested.
REDEMPTIONS AND EXCHANGES
WHAT IS A REDEMPTION?
A redemption is a sale by you to the fund of some or all of your shares in
the fund. The price per share you receive when you redeem fund shares may
be more or less than the price at which you purchased those shares. An
exchange of shares in the fund for shares of a Flex-funds' fund is treated
as a redemption of fund shares and then a purchase of shares of the
Flex-funds' fund. When you redeem or exchange your shares, you will
generally have a gain or loss, depending upon whether the amount you
receive for your shares is more or less than your cost or other basis in
the shares, which the IRS requires you to report on your income tax return.
U.S. GOVERNMENT INTEREST. Many states grant tax-free status to dividends
paid from interest earned on direct obligations of the U.S. Government,
subject to certain restrictions. The fund will provide you with information
at the end of each calendar year on the amount of any such dividends that
may qualify for exemption from reporting on your individual income tax
returns.
NON-U.S. INVESTORS. Ordinary dividends generally will be subject to U.S.
income tax withholding. Your home country may also tax ordinary dividends,
capital gain distributions and gains arising from redemptions or exchanges
of your fund shares. Fund shares held by the estate of a non-U.S. investor
may be subject to U.S. estate tax. You may wish to contact your tax adviser
to determine the U.S. and non-U.S. tax consequences of your investment in
the fund.
STATE TAXES. Ordinary dividends and capital gain distributions that you
receive from the fund, and gains arising from redemptions or exchanges of
your fund shares will generally by subject to state and local income tax.
The holding of fund shares may also be subject to state and local
intangibles taxes. You may wish to contact your tax adviser to determine
the state and local tax consequences of your investment in the fund.
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HOW TO READ THE FINANCIAL HIGHLIGHTS TABLE
The fund began calendar year 1999 with a net asset value (price) of $1.00
per share. During the year, the fund earned $0.050 per share from
investment income (interest and dividends less operating expenses) and
$0.00 per share from investments that had appreciated in value or that were
sold for higher prices than the fund paid for them.
Shareholders received $0.050 per share in the form of dividend and capital
gains distributions. A portion of each year's distributions may come from
the prior year's income or capital gains.
The earnings ($0.050 per share) minus the distributions ($0.050 per share)
resulted in a share price of $1.00 at the end of the year. This was an
increase of $0.00 per share (from $1.00 at the beginning of the year to
$1.00 at the end of the year). For a shareholder who reinvested the
distributions in the purchase of more shares, the total return from the
fund was 5.13% for the year.
As of December 31, 1999, the fund had $868,168,739 in net assets. For the
year, its expense ratio was 0.25% ($25 per $1,000 of net assets); and its
net investment income amounted to 5.01% of its average net assets.
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FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the
fund's financial performance for the past 5 years. 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). This information has been audited by KPMG LLP, independent
auditors, whose report, along with the fund's financial statements, is
included in the annual report, which is available upon request.
THE INSTITUTIONAL FUND
<TABLE>
<CAPTION>
1999 1998 1997 1996 1995
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<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
INCOME FROM INVESTMENT OPERATIONS
NET INVESTMENT INCOME 0.050 0.054 0.054 0.053 0.059
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TOTAL FROM INVESTMENT OPERATIONS 0.050 0.054 0.054 0.053 0.059
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Less Dividends and Distributions
FROM NET INVESTMENT INCOME (0.050) (0.054) (0.054) (0.053) (0.059)
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TOTAL DISTRIBUTIONS (0.050) (0.054) (0.054) (0.053) (0.059)
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NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00
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TOTAL RETURN 5.13% 5.49% 5.53% 5.43% 6.01%
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RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period ($000) $868,169 641,831 415,994 232,142 113,205
Ratio of Expenses to Average Net Assets 0.25% 0.24% 0.25% 0.25% 0.25%
Ratio of Expenses to Average Net Assets 5.01% 5.34% 5.41% 5.30% 5.87%
before waiver of fees(1) 0.45% 0.45% 0.47% 0.46% 0.55%
Ratio of Net Income to Average Net
Assets, before waiver of fees(1) 4.81% 5.13% 5.19% 5.09% 5.57%
<FN>
(1) Includes proportionate share of fees waived in corresponding portfolio. See
"Annual Fund Operating Expenses" for explanation of adviser's waiver of fees.
</FN>
</TABLE>
Financial Statements and Notes pertaining thereto appear in the Statement of
Additional Information.
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SHAREHOLDER MANUAL
HOW TO BUY SHARES
Shares of The Institutional Fund are offered continuously and sold without
a sales charge. Shares are sold at the net asset value per share next
determined after receipt of both a purchase order and payment in federal
funds. Investments made by check are entered and credited at the net asset
value determined on the next business day following receipt.
MINIMUM INVESTMENT. The minimum investment to open an account in the fund
is $5 million.
OPENING AN ACCOUNT. You may open an account by mail or bank wire as
follows:
BY MAIL: To purchase shares, fill out the New Account Application
accompanying this Prospectus. A check payable to The Institutional Fund
must accompany the New Account Application. The fund does not accept third
party checks. Payments may be made by check or Federal Reserve Draft
payable to the fund and should be mailed to the following address: MEEDER
ADVISOR FUNDS, C/O MEEDER ASSET MANAGEMENT, INC., P.O. BOX 7177, DUBLIN,
OHIO 43017.
BY BANK WIRE: If the wire order is for a new account, YOU MUST TELEPHONE
THE FUND PRIOR TO MAKING YOUR INITIAL INVESTMENT. Call 1-800-325-3539, or
(614) 760-2159. Advise the fund of the amount you wish to invest and obtain
an account number and instructions. Have your bank wire federal funds to:
FIRSTAR BANK, N.A. CINTI/TRUST
ABA #: 042-00001-3
ATTENTION: THE INSTITUTIONAL FUND
Credit Account Number 851-2204
Account Name (your name)
Your Institutional Fund account number
On new accounts, a completed application must be sent to Meeder Advisor
Funds c/o Meeder Asset Management, Inc., P.O. Box 7177, Dublin, OH 43017 on
the same day your wire is sent. The fund will not permit a redemption until
it receives the New Account Application in good order.
SUBSEQUENT INVESTMENTS. Subsequent investments in an existing account in
the fund may be made by mailing a check payable to The Institutional Fund.
PLEASE INCLUDE YOUR ACCOUNT NUMBER ON THE CHECK AND MAIL AS FOLLOWS:
MEEDER ADVISOR FUNDS
LOCATION NUMBER: 00215
CINCINNATI, OH 45264-0215
Subsequent investments may also be made by bank wire as described above. IT
IS NECESSARY TO NOTIFY THE FUND PRIOR TO EACH WIRE PURCHASE. Wires sent
without notifying the fund will result in a delay of the effective date of
your purchase.
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WHEN PURCHASES ARE EFFECTIVE. New Account Applications and subsequent
purchase orders for The Institutional Fund which are received by or on
behalf of the fund prior to 3:00 p.m., Eastern time on a business day,
begin earning dividends that day, provided payment in federal funds (bank
wire) is received by the bank that day. New Account Applications and
subsequent purchase orders which are received after 3:00 p.m., or for which
wire payment is not received, are accepted as a purchase the following day.
Investments made by check are credited to shareholder accounts, and begin
to earn dividends, on the next business day following receipt.
If your check is dishonored, the purchase and any dividends paid thereon
will be reversed. If shares are purchased with federal funds, they may be
redeemed at any time thereafter, and you may secure your funds as explained
below. (See "How to Make Withdrawals (Redemptions).")
Financial Institutions: You may buy shares or sell shares of the fund
through a broker or financial institution, which may charge you a fee for
this service. If you are purchasing shares of the fund through a program of
services offered or administered by a brokerage firm or financial
institution, you should read the program materials in conjunction with this
Prospectus.
Purchase orders for the fund which are received prior to 3:00 p.m., Eastern
time, begin earning dividends that day, provided Firstar Bank, N.A., the
Custodian for the fund, receives federal funds by 4:00 p.m., Eastern time,
that same day. If payment for the purchase of shares is not received in a
timely manner, the financial institution could be held liable for any loss
incurred by the fund.
DISTRIBUTION FEES
Rule 12b-1 of the Investment Company Act permits mutual funds that adopt a
written plan to pay out of fund assets certain expenses relating to the
sale and distribution of their shares. The fund has a 12b-1 plan. Under the
plan the fund pays an annual fee of up to 0.03% of fund assets for
distribution services. Payments under the plan are made for distribution in
the form of commissions and fees, advertising, sales literature, services
of public relations consultants, direct solicitation and expenses of
printing prospectuses and reports used for sales purposes. Persons who
receive payments under the plan include securities brokers, attorneys,
accountants, investment advisers, investment performance consultants,
pension actuaries, banks, and service organizations.
HOW TO MAKE WITHDRAWALS (REDEMPTIONS)
Shares are redeemed and funds withdrawn at net asset value per share, and
there are no redemption fees. (See "Valuation of Shares.")
BY MAIL: You may redeem shares by mailing a written request to the Meeder
Advisor Funds, c/o Meeder Asset Management, Inc., P.O. Box 7177, Dublin, OH
43017. Certain requests by mail must include a signature guarantee. It is
designed to protect you and the fund from fraud.
Your request must be made in writing and include a signature guarantee if
any of the following situations apply:
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o Your account registration has changed within the last 30 days;
o The check is being mailed to a different address than the one on
your account (record address);
o The check is being made payable to someone other than the account
owner; or
o The redemption proceeds are being transferred to a fund account
with a different registration.
You should be able to obtain a signature guarantee from a bank, broker,
dealer, credit union (if authorized under state law), securities exchange
or association, clearing agency, or savings association. A notary public
cannot provide a signature guarantee.
We may require further documentation if you are requesting redemption of
shares held of record in the name of corporations or trustees, and other
fiduciaries.
Amounts withdrawn are mailed without charge to the address printed on your
account statement.
BY TELEPHONE: You may redeem by telephone: 1-800-325-3539, or call (614)
760-2159. If you wish to use this procedure, you must select this feature
on the New Account Application. Amounts withdrawn from an account by
telephone are mailed without charge to the address printed on your account
statement.
As a special service, you may arrange to have amounts in excess of $10,000
wired in federal funds to a designated commercial bank account. To use this
procedure, please designate on the New Account Application a bank and bank
account number to receive the proceeds of wire withdrawals. There is no
charge for this service.
You may change the bank account designated to receive redemptions. This may
be done at any time upon written request to the fund. In this case, your
signature must be guaranteed. Additional documentation may be required from
corporations, executors, administrators, trustees, guardians, or other
fiduciaries.
WHEN REDEMPTIONS ARE EFFECTIVE. Redemptions are made at the net asset value
per share next determined after receipt of a redemption request in good
order. (See "Valuation of Shares.")
WHEN PAYMENTS ARE MADE. Amounts withdrawn by telephone are normally mailed
or wired on the next Columbus, Ohio bank business day following the date of
the order for withdrawal. If a request for a wire redemption is received
prior to 3:00 p.m., Eastern time, on a bank business day, funds will be
wired on the same day. Amounts withdrawn by mail are normally sent by mail
within one business day after the request is received, and must be mailed
within seven days, with the following exception. If shares are purchased by
check, the funds' transfer agent will not pay a redemption until reasonably
satisfied the check used to purchase shares has been collected. The fund
will forward proceeds promptly once the check has cleared. (See "How to Buy
Shares.")
ACCOUNTS WITH LOW BALANCES. The fund may redeem shares in your account for
their then current net asset value and pay the proceeds to you if at any
time your account has shares valued at less than $5 million as a result of
redemptions you have made. The fund may redeem the shares in your account
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if you have opened your account for less than the minimum purchase amount
and you do not purchase additional shares to meet the minimum. Before any
shares are redeemed for these purposes, you will be notified in writing 30
days before any such redemption to bring the value of shares in the account
to $5 million.
EXCHANGE PRIVILEGE
You may exchange shares of the fund for shares of any Flex-funds' fund that
are available for sale in your state at their respective net asset values.
The Flex-funds family of funds has a variety of investment objectives. Read
The Flex-funds' prospectus for more information about the fund that meets
your investment goals. You may obtain a free prospectus from Meeder Advisor
Funds, c/o Meeder Asset Management, Inc., P.O. Box 7177, Dublin, Ohio
43017, or by telephone: 1-800-325-3539; in Ohio call (614) 760-2159.
Exchanges are subject to applicable minimum initial and subsequent
investment requirements. It will be necessary to complete a separate New
Account Application if:
o you wish to register a new account in a different name or
o you wish to add telephone redemption to an account.
Exchange requests may be directed to the fund by telephone or written
request. If your request is in valid form, and is received prior to 3:00
p.m., Eastern time, shares will be exchanged that day. Otherwise, they will
be exchanged the next business day.
BY MAIL: Exchange requests may also be made in writing and should be sent
to Meeder Advisor Funds, c/o Meeder Asset Management, Inc., P.O. Box 7177,
Dublin, Ohio 43017. The letter must be signed exactly as your name appears
on the fund's account records.
BY TELEPHONE: Exchange requests may be made by telephone: call
1-800-325-3539, or call (614) 760-2159. You may make exchanges by telephone
if you have telephone redemption privileges for your current account. The
registration of additional accounts must be identical.
Any exchange involves a redemption of all or a portion of the shares in one
fund and an investment of the redemption proceeds in shares of one of the
other funds. The exchange will be based on the respective net asset values
of the shares involved, ordinarily at the value next determined after the
request is received. An exchange may be delayed briefly if redemption
proceeds will not be available immediately for purchase of newly acquired
shares. The exchange privilege may be modified or terminated at any time.
In addition, the fund may reject any exchange request and limit your use of
the exchange privilege.
The exchange of shares of one fund for shares of another fund is treated
for federal income tax purposes as a sale of the shares given in exchange.
You may realize a taxable gain or loss on an exchange, and you should
consult your tax adviser for further information concerning the tax
consequences of an exchange.
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TRANSACTION POLICIES
VALUATION OF SHARES. The net asset value per share (NAV) for the fund is
determined each business day that the Federal Reserve System is open. The
NAV is calculated on each such business day at 3:00 p.m. Eastern Time by
dividing the fund's net assets by the number of its shares outstanding. The
assets of the portfolio are valued on the basis of amortized cost.
BUY AND SELL PRICES. When you buy shares, you pay the NAV. When you sell
shares, you receive the NAV.
EXECUTION OF REQUESTS. The fund is open on those days when the Federal
Reserve System is open, typically Monday through Friday. Buy and sell
requests are executed at the next NAV to be calculated after your request
is received by the transfer agent.
At times of peak activity, it may be difficult to place requests by phone.
During these times, consider sending your request in writing.
In unusual circumstances, the fund may temporarily suspend the processing
of sell requests, or may postpone payment of proceeds for up to seven days,
as allowed by federal securities laws.
TELEPHONE TRANSACTIONS. For your protection, telephone requests may be
recorded in order to verify their accuracy. In addition, the transfer agent
will take measures to verify the identity of the caller, such as asking for
name, account number, Social Security or other taxpayer ID number and other
relevant information. If appropriate measures are taken, the transfer agent
is not responsible for any losses that may occur to any account due to an
unauthorized telephone call. Proceeds from telephone transactions can only
be mailed to the address of record.
SALES IN ADVANCE OF PURCHASE PAYMENTS. When you place a request to sell
shares for which the purchase money has not yet been collected, the request
will be executed in a timely fashion, but the fund will not release the
proceeds to you until your purchase payment clears. This may take up to
fifteen days after the purchase.
OTHER SHAREHOLDER SERVICES
SUB-ACCOUNTING FOR INSTITUTIONAL INVESTORS: The fund's optional
sub-accounting system offers a separate shareholder account for each
participant and a master account record for the institution. Share activity
is thus recorded and statements prepared for both individual sub-accounts
and for the master account. For more complete information concerning this
program contact the fund.
DISTRIBUTOR: Shares of the funds are sold in those states where its shares
have been registered for sale or a valid exemption exists. States where
registration or an exemption exists can be obtained by calling
1-800-325-FLEX or (614) 760-2159.
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MORE ABOUT RISK
The fund's risk profile is largely defined by the fund's principal
securities and investment practices. You may find the most concise
description of the fund's risk profile in "Main Risk Factors."
The fund is permitted to use - within limits established by the trustees -
certain other securities and investment practices that have higher risks
and opportunities associated with them. To the extent that the portfolio
utilizes these securities or practices, its overall performance may be
affected, either positively or negatively. On the following pages are brief
descriptions of these securities and investment practices, along with the
risks associated with them. The fund follows certain policies that may
reduce these risks.
As with any mutual fund, there is no guarantee that the fund will earn
income or show a positive total return over any period of time - days,
months or years.
INVESTMENT PRACTICES AND RELATED RISKS
BORROWING. A loan of money from a bank or other financial institution
undertaken by the portfolio. The portfolio may borrow up to 5% of its
assets. LEVERAGE AND CREDIT RISKS ARE THE PRINCIPAL RISKS.
DEFENSIVE MEASURES. Shortening the average maturity of the portfolio's
investments and/or investing only in the highest quality debt instruments.
The adviser may invest 100% of its assets defensively if it believes market
conditions warrant defensive measures. OPPORTUNITY RISK IS THE PRINCIPAL
RISK.
REPURCHASE AGREEMENTS. The purchase of a security that must later be sold
back to the issuer at the same price plus interest. The portfolio may
invest up to 100% of its assets in repurchase agreements. CREDIT RISK IS
THE PRINCIPAL RISK.
SHORT-TERM TRADING. Selling a security soon after purchase. If the
portfolio engages in short-term trading will have higher turnover and
transaction expenses. Short-term trading may also result in short-term
capital gains. Upon the distribution to you of any net short-term capital
gains from the fund, you will be taxed at ordinary tax rates. There is no
limitation on the portfolio's ability to engage in short-term trading.
MARKET RISK IS THE PRINCIPAL RISK.
SECURITIES AND RELATED RISKS
INVESTMENT GRADE BONDS. Bonds rated BBB (Standard & Poor's) or Baa
(Moody's) or above. INTEREST RATE, PREPAYMENT, MARKET AND CREDIT RISKS ARE
THE PRINCIPAL RISKS.
ILLIQUID AND RESTRICTED SECURITIES. Securities which, by rules of their
issue or by their nature, cannot be sold readily. These include illiquid
Rule 144A securities. The portfolio is permitted to invest 10% of its
assets in illiquid and restricted securities. MARKET, LIQUIDITY AND
TRANSACTION RISKS ARE THE PRINCIPAL RISKS.
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RISK GLOSSARY
CREDIT RISK means that the issuer of a security or the counterparty to an
investment contract may default or become unable to pay its obligations
when due.
INTEREST RATE RISK is the risk that changes in interest rates will
adversely affect the value of an investor's securities. When interest rates
rise, the value of fixed-income securities will generally fall. Conversely,
a drop in interest rates will generally cause an increase in the value of
fixed-income securities. Longer-term securities are subject to greater
interest rate risk.
LEVERAGE RISK occurs in some securities or techniques that tend to magnify
the effect of small changes in an index or a market. This can result in a
loss that exceeds the account that was invested in the contract.
LIQUIDITY RISK occurs when investments cannot be sold readily. The
portfolio may have to accept a less-than-desirable price to complete the
sale of an illiquid security or may not be able to sell it at all.
MARKET RISK exists in all mutual funds and means the risk that the prices
of securities in a market, a sector, or an industry will fluctuate, and
that such movements might reduce an investment's value.
OPPORTUNITY RISK means missing out on an investment opportunity because the
assets necessary to take advantage of it are committed to less advantageous
investments or strategies.
PREPAYMENT RISK is the risk that, as interest rates fall, borrowers are
more likely to refinance their debts. As a result, the principal on certain
fixed income securities may be paid earlier than expected, which could
cause investment losses and cause prepaid amounts to have to be reinvested
at a relatively lower interest rate.
TRANSACTION RISK means that the fund may be delayed or unable to settle a
transaction or that commissions and settlement expenses may be higher than
usual.
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FOR MORE INFORMATION:
STATEMENT OF ADDITIONAL INFORMATION (SAI)
The SAI provides more detailed information about the fund. The SAI has been
filed with the Securities and Exchange Commission and is incorporated by
reference in this Prospectus (is legally a part of this Prospectus).
ANNUAL AND SEMIANNUAL REPORTS
These reports include portfolio holdings, financial statements, performance
information, the auditor's report (in the case of the annual report), and a
discussion of the market conditions and investment strategies that
significantly affected the fund's performance during its last fiscal year.
Information about the fund (including the SAIs) can be reviewed and copied
at the Commission's Public Reference Room in Washington, D.C., and
information on the operation of the Public Reference Room may be obtained
by calling the Commission at 1-202-942-8090. Reports and other information
about the fund are available on the EDGAR Database on the Commission's
Internet site at http://www.sec.gov, and copies of this information may be
obtained, after paying a duplicating fee, by electronic request at the
following E-mail address: [email protected], or by writing the
Commission's Public Reference Section, Washington, D.C. 20549-0102.
To request a free copy of the current annual/semi-annual report or SAI,
request other information about the fund, or make shareholder inquiries,
please write, call or E-mail us at:
Meeder Advisor Funds
6000 Memorial Drive
Dublin, OH 43017
614-760-2159
Toll Free 1-800-325-3539
Fax: 614-766-6669
Investment Company Act File No. 811-6720
