LORD ABBETT SECURITIES TRUST, 497, 2000-03-07

LORD ABBETT SECURITIES TRUST
497, 2000-03-07

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Lord
Abbett

Prospectus
March 1, 2000

Growth & Income Series
International Series
World Bond-Debenture Series
Alpha Series

[GRAPHIC OMITTED]

As with all mutual funds, 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.

Class P shares of the International Series are currently offered by this
prospectus. Class P shares of the Growth & Income Series, Alpha Series, and
World Bond-Debenture Series are neither offered to the general public nor
available in all states. Please call 800-821-5129 for further information.

<PAGE>

Table of Contents

The Funds

Information about the goal/ Growth & Income Series 2
principal strategy, main risks, International Series 5
performance, and fees World Bond-Debenture Series 8
and expenses Alpha Series 11

Your Investment

Information for managing Purchases 15
your Fund account Sales Compensation 18
Opening Your Account 18
Redemptions 19
Distributions and Taxes 19
Services For Fund Investors 20
Management 21

For More Information

How to learn more Other Investment Techniques 23
about the Funds Glossary of Shaded Terms 26
Recent Performance 28

Financial Information

Financial highlights and line Growth & Income Series 30
graph comparison of each Fund, International Series 32
and broker compensation World Bond-Debenture Series 34
Alpha Series 36
Compensation For Your Dealer 38

How to learn more about the Funds Back Cover
and other Lord Abbett Funds

<PAGE>

Growth & Income Series

GOAL / PRINCIPAL STRATEGY

The Fund's investment objective is long-term growth of capital and income
without excessive fluctuations in market value.

To pursue this goal, the Fund purchases stocks of large, seasoned, U.S. and
multinational companies which we believe are undervalued. The Fund chooses
stocks using

o quantitative research to identify which stocks we believe represent
the best bargains

o fundamental research to learn about a company's operating environment,
resources and strategic plans and to assess its prospects for
exceeding earnings expectations

o business cycle analysis to determine how buying or selling securities
changes our overall portfolio's sensitivity to interest rates and
economic conditions.

The Fund is intended for investors looking for long-term growth with low
fluctuations in market value. For this reason, we will forgo some
opportunities for gains when, in our judgment, they are too risky. The Fund
tries to keep its assets invested in securities selling at reasonable
prices in relation to value.

While there is the risk that an investment may never reach what we think is
its full value, or may go down in value, our emphasis on large, seasoned
company bargain stocks may limit our downside risk because bargain stocks
in theory are already underpriced and large, seasoned company stocks tend
to be less volatile than small company stocks.

We generally sell a stock when we think it is no longer a bargain, seems
less likely to benefit from the current market and economic environment,
shows deteriorating fundamentals, or falls short of our expectations.

While typically fully invested, at times we may take a temporary defensive
position by investing some of the Fund's assets in short-term debt
securities. This could reduce the benefit from any upswing in the market
and prevent the Fund from achieving its investment objective.

MAIN RISKS

The Fund is subject to the general risks and considerations associated with
equity investing, as well as the particular risks associated with bargain
stocks. The value of your investment will fluctuate in response to
movements in the stock market in general and to the changing prospects of
individual companies in which the Fund invests. Bargain stocks may perform
differently than the market as a whole and other types of stocks, such as
small company stocks and growth stocks. This is because different types of
stocks tend to shift in and out of favor depending on market and economic
conditions. The market may fail to recognize the intrinsic value of
particular bargain stocks for a long time. In addition, if the Fund's
assessment of a company's value or prospects for exceeding earnings
expectations or market conditions is wrong, the Fund could suffer losses or
produce poor performance relative to other funds, even in a rising market.

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
government agency. The Fund is not a complete investment program and may
not be appropriate for all investors. You could lose money in the Fund.

We or the Funds refers to any one or more of the the portfolios of Lord Abbett
Securities Trust discussed in this Prospectus.

About each Fund. Each Fund is a professionally managed portfolio primarily
holding securities purchased with the pooled money of investors. It strives to
reach its stated goal, although as with all mutual funds, it cannot guarantee
results.

Large companies are established companies that are considered "known
quantities." Large companies often have the resources to weather economic
shifts, though they can be slower to innovate than small companies.

Seasoned companies are usually established companies whose securities have
gained a reputation for quality with the investing public and enjoy liquidity in
the market.

Bargain stocks are stocks of companies that appear underpriced according to
certain financial measurements of their intrinsic worth or business prospects.

Small-company stocks are stocks of smaller companies which often are new and
less established, with a tendency to be faster-growing but more volatile than
large company stocks.

Growth stocks are stocks which exhibit faster-than-average gains in earnings and
are expected to continue profit growth at a high level, but also tend to be more
volatile than bargain stocks,

You should read this entire prospectus, including "Other Investment Techniques,"
which concisely describes the other investment strategies, and their risks used
by the Funds.

2 The Funds

<PAGE>

Growth & Income Series Symbols: Class A - LDFVX
Class B - GILBX
Class C - GILAX

PERFORMANCE

The bar chart and table below provide some indication of the risks of
investing in the Fund by illustrating the variability of the Fund's
returns. Each assumes reinvestment of dividends and distributions. The
Fund's past performance is not necessarily an indication of how the Fund
will perform in the future.

The bar chart shows changes in the performance of the Fund's Class C shares
from calendar year to calendar year. This chart does not reflect the sales
charges applicable to Class C shares. If the sales charges were reflected,
returns would be less.

- --------------------------------------------------------------------------------
Bar Chart (per calendar year) - Class C Shares

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

[GRAPHIC OMITTED]
1995 - 32.3%
1996 - 18.3%
1997 - 26.9%
1998 - 14.6%
1999 - 19.6%

Best Quarter 4th Q `98 18.4% Worst Quarter 3rd Q `98 -11.3%

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

The table below shows how the average annual total returns of the Fund's
Class A, B and C shares compare to those of a broad-based securities market
index and a more narrowly based index that more closely reflects the market
sectors in which the Fund invests. The Fund's returns reflect payment of
the maximum applicable front-end or deferred sales charges.

- --------------------------------------------------------------------------------
Average Annual Total Returns Through December 31, 1999

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

Share Class 1 Year 5 Years Since Inception(1)

Class A shares 13.40% - 21.85%
- --------------------------------------------------------------------------------
Class B shares 14.63% - 18.00%
Class C shares 18.58% 22.16% 18.45%
- --------------------------------------------------------------------------------
S&P 500(R)Index(2) 21.03% 28.54% 29.57%(3)
24.26%(4)
23.54%(5)
- --------------------------------------------------------------------------------
S&P Barra Value Index(2) 12.72% 22.94% 21.95%(3)
15.78%(4)
18.65%(5)
- --------------------------------------------------------------------------------

(1) The dates of inception for each Class are: A - 7/15/96; B - 6/5/97; and C -
1/3/94.
(2) Performance for the unmanaged S&P 500(R)Index and S&P Barra Value Index
does not reflect fees or expenses. The performance of the indices is not
necessarily representative of the Fund's performance.
(3) Represents total return for the period 7/31/96 - 12/31/99, to correspond
with Class A inception date.
(4) Represents total return for the period 6/30/97 - 12/31/99, to correspond
with Class B inception date.
(5) Represents total return for the period 12/31/93 - 12/31/99, to correspond
with Class C inception date.

The Funds 3

<PAGE>

FEES AND EXPENSES

This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.
<TABLE>
<CAPTION>

- ------------------------------------------------------------------------------------------
Fee Table

- ------------------------------------------------------------------------------------------
Class A Class B(2) Class C Class P

Shareholder Fees (Fees paid directly
from your investment)
- ------------------------------------------------------------------------------------------
Maximum Sales Charge on Purchases
(as a % of offering price) 5.75% none none none
- ------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge none(1) 5.00% 1.00%(1) none
- ------------------------------------------------------------------------------------------
Annual Fund Operating Expenses (Expenses
deducted from Fund assets) (as a % of
average net assets)(3)
- ------------------------------------------------------------------------------------------
Management Fees (See "Management") 0.75% 0.75% 0.75% 0.75%
Distribution (12b-1) and Service Fees(4) 0.35% 1.00% 1.00% 0.45%
Other Expenses 0.23% 0.23% 0.23% 0.23%
Total Operating Expenses 1.33% 1.98% 1.98% 1.43%
- ------------------------------------------------------------------------------------------
</TABLE>

(1) A contingent deferred sales charge of 1.00% may be assessed on certain
redemptions of (a) Class A shares made within 24 months following any
purchases made without a sales charge, and (b) Class C shares if they are
redeemed before the first anniversary of their purchase.
(2) Class B shares will convert to Class A shares on the eighth anniversary of
your original purchase of Class B shares.
(3) The annual operating expenses have been restated from fiscal year amounts
to reflect current fees.
(4) Because 12b-1 fees are paid out on an ongoing basis, over time they will
increase the cost of your investment and may cost you more than paying
other types of sales charges.

- --------------------------------------------------------------------------------
Example
- --------------------------------------------------------------------------------

This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. This Example, like that in
other funds' prospectuses, assumes that you invest $10,000 in the Fund at
maximum sales charge, if any, for the time periods indicated and then redeem all
of your shares at the end of those periods. The Example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. Although your actual costs may be higher or lower, based on
these assumptions your costs (including any applicable contingent deferred sales
charges) would be: Share Class 1 Year 3 Years 5 Years 10 Years Class A shares
$703 $972 $1,262 $2,084
- --------------------------------------------------------------------------------
Class B shares $701 $921 $1,268 $2,139
- --------------------------------------------------------------------------------
Class C shares $301 $621 $1,068 $2,306
- --------------------------------------------------------------------------------
Class P shares $146 $452 $ 782 $1,713

You would have paid the following expenses if you did not redeem your shares:

Class A shares $703 $972 $1,262 $2,084
- --------------------------------------------------------------------------------
Class B shares $201 $621 $1,068 $2,139
- --------------------------------------------------------------------------------
Class C shares $201 $621 $1,068 $2,306
- --------------------------------------------------------------------------------
Class P shares $146 $452 $ 782 $1,713

Management fees are payable to Lord, Abbett & Co. ("Lord Abbett") for the Fund's
investment management.

12b-1 fees refer to fees incurred for activities that are primarily intended to
result in the sale of Fund shares and service fees for shareholder account
service and maintenance.

Other expenses include fees paid for miscellaneous items such as shareholder
service fees and professional fees.

4 The Funds

<PAGE>

International Series

GOAL / PRINCIPAL STRATEGY

The Fund's investment objective is long-term capital appreciation.

To pursue this goal, the Fund invests in stocks of companies principally
based outside the United States. Under normal conditions, at least 80% of
the Fund's assets will be invested in stocks of companies in at least three
different countries outside the United States.

The Fund intends to invest primarily in stocks of small companies, those
with market capitalizations of less than $2 billion, although the Fund may
also invest in stocks of larger companies.

We look for

o developing global trends on an industry-by-industry basis

o companies which are the strongest or the best positioned in those
industries

o companies selling at attractive prices

o companies we see as having the best potential for growth or profits.

We may limit the number of holdings in this Fund to a greater degree than
other similar funds in an effort to prevent the dilution of the performance
of securities held in the portfolio. However, this Fund is a diversified
fund.

The Fund may temporarily reduce its stock holdings for defensive purposes
in response to adverse market conditions and invest in domestic, Eurodollar
and foreign short-term money market instruments. This could potentially
reduce the Fund's ability to benefit from an upswing in the market and
prevent the Fund from achieving its investment objective.

MAIN RISKS

The Fund is subject to the general risks and considerations associated with
investing, such as market risk. This means the value of your investment in
the Fund will fluctuate in response to movements in the securities markets
in general and to the changing prospects of individual companies in which
the Fund invests. In addition, the Fund is subject to the risks of
investing in foreign securities and in the securities of small companies.

Investing in small companies generally involves greater risks than
investing in the stocks of large companies. Small companies may have less
experienced management, limited product lines, unproven track records, and
limited financial resources. Their securities may carry increased market,
liquidity, and other risks.

Foreign securities may present risks not typically associated with domestic
securities. Foreign markets and the securities traded in them are not
subject to the same degree of regulation as U.S. markets which may increase
the degree of market risk associated with them. Foreign securities may also
be subject to liquidity, currency and political risk. Foreign investments
may be affected by changes in currency rates or currency controls. With
respect to certain foreign countries, there is a possibility of
nationalization, expropriation or confiscatory taxation, imposition of
withholding or other taxes, and political or social instability which could
affect investments in those countries.

Investing in both small and international companies generally involves some
degree of information risk. That means that key information about an
issuer, security or market may be inaccurate or unavailable.

Small companies are often new and less established, with a tendency to be
faster-growing but more volatile and less liquid than large company stocks.

The Funds 5

<PAGE>

International Series Symbols: Class A - LAIEX
Class B - LINBX
Class C - LINCX

PERFORMANCE

The bar chart shows changes in the performance of the Fund's Class A shares
from calendar year to calendar year. This chart does not reflect the sales
charges applicable to Class A shares. If the sales charges were reflected,
returns would be less.

- --------------------------------------------------------------------------------
Bar Chart (per calendar year) - Class A Shares
- --------------------------------------------------------------------------------

[GRAPHIC OMITTED]
1997 - 19.7%
1998 - 15.5%
1999 - 28.0%

Best Quarter 1st Q `98 23.7% Worst Quarter 3rd Q `98 -19.0%

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

The table below shows how the average annual total returns of the Fund's
Class A, B, C and P shares compare to those of a broad-based securities
market index. The Fund's returns reflect payment of the maximum applicable
front-end or deferred sales charges.

- --------------------------------------------------------------------------------
Average Annual Total Returns Through December 31, 1999

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

Share Class 1 Year Since Inception(1)

Class A shares 19.90% 18.23%
- --------------------------------------------------------------------------------
Class B shares 21.34% 18.90%
- --------------------------------------------------------------------------------
Class C shares 25.25% 19.75%
- --------------------------------------------------------------------------------
Class P shares - 29.83%
- --------------------------------------------------------------------------------
Morgan Stanley Capital International 27.30% 16.06%(3)

European, Australasia and Far East Index(2) 14.53%(4)
("MSCI EAFE Index") 30.62%(5)
- --------------------------------------------------------------------------------

(1) The dates of inception for each Class are: A - 12/13/96; B - 6/2/97; C -
6/2/97; and P - 3/8/99.
(2) Performance for the unmanaged MSCI EAFE Index does not reflect fees or
expenses. The performance of the index is not necessarily representative of
the Fund's performance.
(3) Represents total return for the period 12/31/96 - 12/31/99, to correspond
with Class A inception date.
(4) Represents total return for the period 6/30/97 - 12/31/99, to correspond
with Class B and C inception date.
(5) Represents total return for the period 3/31/99 - 12/31/99, to correspond
with Class P inception date.

6 The Funds

<PAGE>

International Series

FEES AND EXPENSES

This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
Fee Table
- ------------------------------------------------------------------------------------------
Class A Class B(2) Class C Class P

Shareholder Fees (Fees paid directly
from your investment)
- ------------------------------------------------------------------------------------------
Maximum Sales Charge on Purchases
- ------------------------------------------------------------------------------------------
(as a % of offering price) 5.75% none none none
- ------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge none(1) 5.00% 1.00%(1) none
- ------------------------------------------------------------------------------------------
Annual Fund Operating Expenses
(Expenses deducted from Fund assets)
(as a % of average net assets)(3)
- ------------------------------------------------------------------------------------------
Management Fees (See "Management") 0.75% 0.75% 0.75% 0.75%
- ------------------------------------------------------------------------------------------
Distribution (12b-1) and Service Fees(4) 0.35% 1.00% 1.00% 0.45%
- ------------------------------------------------------------------------------------------
Other Expenses 0.44% 0.44% 0.44% 0.44%
- ------------------------------------------------------------------------------------------
Total Operating Expenses 1.54% 2.19% 2.19% 1.64%
</TABLE>

(2) Class B shares will convert to Class A shares on the eighth anniversary of
your original purchase of Class B shares.

(3) The annual operating expenses have been restated from fiscal year amounts
to reflect current fees.

(4) Because 12b-1 fees are paid out on an ongoing basis, over time they will
increase the cost of your investment and may cost you more than paying
other types of sales charges.

- --------------------------------------------------------------------------------
Example
- --------------------------------------------------------------------------------
This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. This Example, like that in
other funds' prospectuses, assumes that you invest $10,000 in the Fund at
maximum sales charge, if any, for the time periods indicated and then redeem all
of your shares at the end of those periods. The Example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. Although your actual costs may be higher or lower, based on
these assumptions your costs (including any applicable contingent deferred sales
charges) would be:

Share Class 1 Year 3 Years 5 Years 10 Years

Class A shares $723 $1,033 $1,366 $2,304
- -------------------------------------------------------------------------------
Class B shares $722 $ 985 $1,375 $2,359
- -------------------------------------------------------------------------------
Class C shares $322 $ 685 $1,175 $2,524
- -------------------------------------------------------------------------------
Class P shares $167 $ 517 $ 892 $1,944
- -------------------------------------------------------------------------------
You would have paid the following expenses if you did not redeem your shares:

Class A shares $723 $1,033 $1,366 $2,304
- -------------------------------------------------------------------------------
Class B shares $222 $ 685 $1,175 $2,359
- -------------------------------------------------------------------------------
Class C shares $222 $ 685 $1,175 $2,524
- -------------------------------------------------------------------------------
Class P shares $167 $ 517 $ 892 $1,944

Management fees are payable to Lord Abbett for the Fund's investment management.

12b-1 fees refer to fees incurred for activities that are primarily intended to
result in the sale of Fund shares and service fees for shareholder account
service and maintenance.

Other expenses include fees paid for miscellaneous items such as shareholder
service fees and professional fees.

The Funds 7

<PAGE>

World Bond-Debenture Series

GOAL / PRINCIPAL STRATEGY

The Fund's investment objective is high current income and the opportunity
for capital appreciation.

To pursue its goal, the Fund purchases debt securities of U.S. and foreign
issuers. The Fund may invest up to 100% of its assets in foreign securities
without limiting itself to any particular country. Normally, however, the
Fund invests in at least three countries.

We look for unusual values, particularly in lower-rated debt securities,
some of which are convertible into common stocks or warrants to purchase
common stocks. The portfolio managers choose debt securities using

o quantitative research to evaluate economic, political and market
factors to uncover value in economic regions and political areas
around the world

o fundamental research to determine asset allocation strategies among
debt securities.

Normally, the Fund invests at least 65% of its assets in all types of
bonds, debentures, and other debt securities including: high-yield debt
securities (also known as junk bonds); investment grade corporate,
government and other debt issues; equity-related securities such as
convertibles and debt securities with warrants; and emerging market debt
securities.

The Fund may purchase securities denominated in foreign currencies or in
U.S. dollars. The Fund also may effect currency exchange transactions,
including agreements to exchange one currency for another at a future date,
known as forward foreign currency contracts. The Fund

o will keep at least 20% of its assets in investment-grade debt, U.S.
government securities, or cash

o may invest up to 35% of its assets in equity or equity-related
securities, although this limit may be exceeded to avoid a loss upon a
conversion of a convertible debt security.

We may take a temporary defensive position by investing our assets in
short-term debt securities, in securities traded in fewer than three
countries or entirely in domestic securities. This could reduce the benefit
from any upswing in the market and prevent the Fund from achieving its
investment objective.

MAIN RISKS

The Fund is subject to the general risks and considerations associated with
investing in debt securities. The value of your investment will change as
interest rates fluctuate. When interest rates rise, debt security prices
are likely to decline, and when interest rates fall, debt securities prices
tend to rise. There is also the risk that an issuer of a debt security will
fail to make timely payments of principal or interest to the Fund. This
risk is greater with junk bonds. Junk bonds are also subject to liquidity
risks.

Foreign securities may present increased market, liquidity, currency,
political, information and other risks.

The Fund is non-diversified. Non-diversified funds may invest in the
securities of a relatively few number of issuers. The value of an
individual security can be more volatile than the market as a whole and can
perform differently than the market as a whole. To the extent the Fund
holds securities of fewer issuers than other funds it may be more volatile
than those funds.

High-yield debt securities or "junk bonds" typically pay a higher yield than
investment-grade bonds. Junk bonds have a higher risk of default than investment
grade bonds and their prices can be much more volatile.

Warrants are a type of security usually issued with a bond that entitles the
holder to buy a proportionate amount of common stock at a certain price for a
defined period.

Bonds are secured debt obligations of the issuer.

Debentures generally are unsecured debt obligations of the issuer.

8 The Funds

<PAGE>

World Bond-Debenture Series Symbols: Class A - WBDAX
Class B - WBDBX
Class C - WBDCX

PERFORMANCE

[GRAPHIC OMITTED]
1998 - 5.5%
1999 - 5.4%

Best Quarter 4th Q `98 6.4% Worst Quarter 3rd Q `98 -4.7%

- --------------------------------------------------------------------------------
The table below shows how the average annual total returns of the Fund's
Class A, B and C shares compare to those of three broad-based securities
market indices that together reflect the market sectors in which the Fund
invests. The Fund's returns reflect payment of the maximum applicable
front-end or deferred sales charges.
- --------------------------------------------------------------------------------
Average Annual Total Returns Through December 31, 1999
- --------------------------------------------------------------------------------

Share Class 1 Year Since Inception(1)
Class A shares 0.40% 3.38%
- --------------------------------------------------------------------------------
Class B shares 0.06% 3.99%
- --------------------------------------------------------------------------------
Class C shares 3.68% 5.22%
- --------------------------------------------------------------------------------
JP Morgan Emerging Market Index(2) 25.97% 3.87%(3)
- --------------------------------------------------------------------------------
JP Morgan Global Gov't Bond Index(2) (5.08)% 8.80%(3)
- --------------------------------------------------------------------------------
Merrill Lynch High Yield Master Index(2) 1.57% 2.61%(3)

(1) The date of inception for each Class is: A - 12/18/97; B - 12/18/97; and C
- 12/18/97.
(2) Performance for each unmanaged index does not reflect fees or expenses. The
performance of the indices is not necessarily representative of the Fund's
performance.
(3) Represents total return for the period 12/31/97 - 12/31/99, to correspond
with Class A, B, and C inception dates.

The Funds 9

<PAGE>

FEES AND EXPENSES

This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
Fee Table

- ------------------------------------------------------------------------------------------
Class A Class B(2) Class C Class P

<S> <C> <C> <C> <C>
Shareholder Fees (Fees paid directly
from your investment)
- ------------------------------------------------------------------------------------------
Maximum Sales Charge on Purchases
(as a % of offering price) 4.75% none none none
- ------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge none(1) 5.00% 1.00%(1) none
- ------------------------------------------------------------------------------------------
Annual Fund Operating Expenses (Expenses
deducted from Fund assets)
(as a % of average net assets)(3)
- ------------------------------------------------------------------------------------------
Management Fees (See "Management") 0.75% 0.75% 0.75% 0.75%
- ------------------------------------------------------------------------------------------
Distribution (12b-1) and Service Fees(4) 0.35% 1.00% 1.00% 0.45%
- ------------------------------------------------------------------------------------------
Other Expenses 0.76% 0.76% 0.76% 0.76%
- ------------------------------------------------------------------------------------------
Total Operating Expenses 1.86% 2.51% 2.51% 1.96%
- ------------------------------------------------------------------------------------------
</TABLE>

Share Class 1 Year 3 Years 5 Years 10 Years

Class A shares $655 $1,032 $1,433 $2,551
- -------------------------------------------------------------------------------
Class B shares $754 $1,082 $1,535 $2,687
- -------------------------------------------------------------------------------
Class C shares $354 $ 782 $1,335 $2,846
- -------------------------------------------------------------------------------
Class P shares $199 $ 615 $1,057 $2,285
- -------------------------------------------------------------------------------

You would have paid the following expenses if you did not redeem your shares:

Class A shares $655 $1,032 $1,433 $2,551
- -------------------------------------------------------------------------------
Class B shares $254 $ 782 $1,335 $2,687
- --------------------------------------------------------------------------------
Class C shares $254 $ 782 $1,335 $2,846
- -------------------------------------------------------------------------------
Class P shares $199 $ 615 $1,057 $2,285
- -------------------------------------------------------------------------------

Management fees are payable to Lord Abbett for the Fund's investment management.

12b-1 fees refer to fees incurred for activities that are primarily intended to
result in the sale of Fund shares and service fees for shareholder account
service and maintenance.

Other expenses include fees paid for miscellaneous items such as shareholder
service fees and professional fees.

Lord Abbett is currently waiving the management fees and subsidizing a portion
of the other expenses of the Fund. Lord Abbett may stop waiving the management
fees and subsidizing a portion of the other expenses at any time. The total
operating expense ratio with the fee waiver and the partial expense subsidy is
0.91% for Class A, 1.56% for Class B and Class C, and 1.01% for Class P.

10 The Funds

<PAGE>

Alpha Series

GOAL / PRINCIPAL STRATEGY

The Fund's investment objective is long-term capital appreciation.

To pursue its goal, the Fund invests in three underlying funds managed by
Lord Abbett. The underlying funds focus on small and international
companies. The Fund allocates its assets among the underlying funds by
attempting to achieve a balance, over time, between foreign and domestic
securities similar to that of the unmanaged Salomon Extended Market Index.
This Fund is intended for investors who are seeking exposure to the stocks
of small U.S. and foreign companies managed in both growth and value
styles.

As of the date of this prospectus, the Fund invested the following
approximate percentages in the underlying funds: 40% in the International
Series, 30% in the Small-Cap Value Series and 30% in the Developing Growth
Fund. We decide how much to invest in the underlying funds at any
particular time. These amounts may change at any time without shareholder
approval.

The Fund may temporarily reduce its holdings in the underlying funds for
defensive purposes in response to adverse market conditions and invest in
short-term debt securities. This could potentially reduce the Fund's
ability to benefit from an upswing in the market.

MAIN RISKS

The Fund's investments are concentrated in the underlying funds and, as a
result, the Fund's performance is directly related to their performance.
The Fund's ability to meet its investment objective depends on the ability
of the underlying funds to achieve their investment objectives. The Fund's
net asset value will change as general equity price levels change and as
the financial condition and prospects change for issuers in which the
underlying funds invest.

Because the Fund's principal investments are in the underlying funds, the
Fund is subject to the risks of the underlying funds in the proportion in
which the Fund invests in them. Each underlying fund is subject to the
risks of investing in the securities of small companies and in foreign
securities. The risks presented by the investment practices of the
Small-Cap Value Series and the Developing Growth Fund are discussed in the
"Alpha Series Underlying Funds" section immediately below. The previous
section of this prospectus titled "International Series" discusses the
risks of investing in that underlying fund.

You may invest in the underlying funds directly. By investing in the Fund,
you will incur a proportionate share of the expenses of the underlying
funds in addition to any expenses of 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
government agency. While the Fund offers a greater level of diversification
than many other types of mutual funds, it is not a complete investment
program and may not be appropriate for all investors. You could lose money
by investing in the Fund.

Underlying Funds in which the Fund invests are:

o Lord Abbett Developing Growth Fund ("Developing Growth Fund")

o Lord Abbett Securities Trust - International Series ("International
Series") and

o Lord Abbett Research Fund - Small-Cap Value Series ("Small-Cap Value
Series")

Fund's Volatility and Balance. The Fund's long-term volatility is expected to
approximate that of the unmanaged Salomon Extended Market Index. Over time, the
Fund intends to approximate the index's balance between foreign and domestic
securities by varying its investments in the underlying funds, subject to the
Fund's cash flow and desire to avoid excessive capital gains distributions. Past
performance and volatility of the index do not indicate future results for the
index or the Fund. The Fund may not achieve this level of volatility, balance,
or its objective.

The Funds 11

<PAGE>

ABOUT THE ALPHA SERIES UNDERLYING FUNDS

The Alpha Series invests in three Lord Abbett underlying funds: the
International Series, the Small-Cap Value Series and the Developing Growth
Fund. The following is a concise description of the investment objectives
and practices of the Small-Cap Value Series and the Developing Growth Fund.
No offer is made in this prospectus of either of these two funds.
A full description of the investment objectives and practices of the
International Series may be found in this prospectus under the previous
section titled "International Series."

The Small-Cap Value Series' investment objective is long-term capital
appreciation. This fund usually invests at least 65% of its assets in
stocks of small companies, particularly those with market capitalizations
of less than $2 billion. The Small-Cap Value Series tries to keep its
assets invested in securities selling at reasonable prices in relation to
value.

The Developing Growth Fund's investment objective is capital appreciation.
Normally, at least 65% of this fund's assets are invested in the stocks of
small companies in their developing growth stage. The Developing Growth
Fund looks for companies with strong management and above-average growth
potential.

Both the Small-Cap Value Series and the Developing Growth Fund use
extensive fundamental analysis in an attempt to identify outstanding
companies for investment.

Investing in small companies generally involves greater risks than
investing in the stocks of large companies. Small companies may have
less-experienced management, limited product lines, unproven track records,
and limited financial resources. Their securities may carry increased
market, liquidity, and other risks.

Foreign securities may present risks not typically associated with domestic
securities. Foreign markets and the securities traded in them are not
subject to the same degree of regulation as U.S. markets, which may
increase the degree of market risk associated with them. Foreign securities
may also be subject to liquidity, currency and political risk. Foreign
investments may be affected by changes in currency rates or currency
controls. Certain foreign countries may limit a Fund's ability to remove
its assets from the country. With respect to certain foreign countries,
there is a possibility of nationalization, expropriation or confiscatory
taxation, imposition of withholding or other taxes, and political or social
instability which could affect investments in those countries.

12 The Funds

<PAGE>

Alpha Series Symbols: Class A - ALFAX
Class B - ALFBX
Class C - ALFCX

PERFORMANCE

[GRAPHIC OMITTED]
1998 - 5.9%
1999 24.9%

Best Quarter 4th Q `99 18.3% Worst Quarter 2nd Q `98 -21.2%

- --------------------------------------------------------------------------------
The table below shows how the average annual total returns of the Fund's
Class A, B and C shares compare to those of a broad-based securities market
index. The Fund's returns reflect payment of the maximum applicable
front-end or deferred sales charges.
- --------------------------------------------------------------------------------
Average Annual Total Returns Through December 31, 1999
- --------------------------------------------------------------------------------

Share Class 1 Year Since Inception(1)
Class A Shares 17.70% 12.11%
- --------------------------------------------------------------------------------
Class B Shares 19.17% 13.47%
- --------------------------------------------------------------------------------
Class C Shares 23.04% 14.71%
- --------------------------------------------------------------------------------
Salomon Brothers Extended Market Index(2) 22.09% 13.14%(3)
- --------------------------------------------------------------------------------

(1) The date of inception for all classes is 12/29/97.
(2) Performance for the unmanaged Salomon Brothers Extended Market Index does
not reflect fees or expenses. The performance of the index is not
necessarily representative of the Fund's performance.
(3) Represents total return for the period 12/31/97 - 12/31/99, to correspond
with Class A, B, and C inception dates.

The Funds 13

<PAGE>

FEES AND EXPENSES\
This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.

- ------------------------------------------------------------------------------------------
Fee Table

- ------------------------------------------------------------------------------------------
Class A Class B(2) Class C Class P

<S> <C> <C> <C> <C>
Shareholder Fees (Fees paid directly
from your investment)
- ------------------------------------------------------------------------------------------
Maximum Sales Charge on Purchases
(as a % of offering price) 5.75% none none none
- ------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge none(1) 5.00% 1.00%(1) none
- ------------------------------------------------------------------------------------------
Annual Fund Operating Expenses (Expenses
deducted from Fund assets)
(as a % of average net assets)(3)
- ------------------------------------------------------------------------------------------
Management Fees (See "Management") 0.50% 0.50% 0.50% 0.50%
- ------------------------------------------------------------------------------------------
Distribution (12b-1) and Service Fees(4) 0.35% 1.00% 1.00% 0.45%
- ------------------------------------------------------------------------------------------
Other Expenses 0.00% 0.00% 0.00% 0.00%
- ------------------------------------------------------------------------------------------
Total Operating Expenses 0.85% 1.50% 1.50% 0.95%
- ------------------------------------------------------------------------------------------
</TABLE>

While each Class of shares of the Alpha Series is expected to operate with the
direct total operating expenses shown under the "Fee Table" above, shareholders
in the Alpha Series bear indirectly the Class Y share expenses of the underlying
funds in which the Alpha Series invests. The following chart provides the
expense ratio for each of the underlying funds' Class Y shares, as well as the
approximate percentage of the Alpha Series' net assets invested in each
underlying fund on October 31, 1999:

Underlying Funds' % of Alpha Series
expense ratios net assets
Developing Growth Fund .71% 30%
- --------------------------------------------------------------------------------
Small-Cap Value Series 1.19% 30%
- --------------------------------------------------------------------------------
International Series 1.20% 40%
- --------------------------------------------------------------------------------
100%
- --------------------------------------------------------------------------------

Based on these figures, the weighted average Class Y share expense ratio for the
underlying funds in which Alpha Series invests is 1.05% (the "underlying expense
ratio"). This figure is only an approximation of the Alpha Series' underlying
expense ratio, since the amount of assets invested in each of the underlying
funds changes daily.

- --------------------------------------------------------------------------------
Example
- --------------------------------------------------------------------------------
This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. This Example, like that in
other funds' prospectuses, assumes that you invest $10,000 in the Fund at
maximum sales charge, if any, for the time periods indicated and then redeem all
of your shares at the end of those periods. The Example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. In addition, the Example assumes the Fund pays the operating
expenses set forth in the fee table above and the Fund's prorata share of the
Class Y expenses of the underlying funds. Although your actual costs may be
higher or lower, based on these assumptions your costs (including any applicable
contingent deferred sales charges) would be:

Share Class 1 Year 3 Years 5 Years 10 Years

Class A shares $757 $1,138 $1,542 $2,669
- --------------------------------------------------------------------------------
Class B shares $758 $1,093 $1,555 $2,727
- --------------------------------------------------------------------------------
Class C shares $358 $ 793 $1,355 $2,885
- --------------------------------------------------------------------------------
Class P shares $203 $ 627 $1,078 $2,327

You would have paid the following expenses if you did not redeem your shares:

Class A shares $757 $1,138 $1,542 $2,669
- --------------------------------------------------------------------------------
Class B shares $258 $ 793 $1,355 $2,727
- --------------------------------------------------------------------------------
Class C shares $258 $793 $1,355 $2,885
- --------------------------------------------------------------------------------
Class P shares $203 $ 627 $1,078 $2,327
- --------------------------------------------------------------------------------

Management fees are payable to Lord Abbett for the Fund's investment management.
Lord Abbett is currently waiving its management fees for the Fund. Lord Abbett
may stop waiving the management fees at any time. Total operating expenses with
the management fee waiver are 0.35% (Class A shares), 1.00% (Class B and C
shares), and .45% (Class P shares).

12b-1 fees refer to fees incurred for activities that are primarily intended to
result in the sale of Fund shares and service fees for shareholder account
service and maintenance.

Other expenses include fees paid for miscellaneous items such as shareholder
service fees and professional fees. The Fund has entered into a servicing
arrangement with the underlying funds under which the underlying funds may bear
certain of the Fund's Other Expenses. As a result, the Fund does not expect to
bear any of these Other Expenses.

14 The Funds

<PAGE>

YOUR INVESTMENT

PURCHASES

The Funds offer in this prospectus four classes of shares: Classes A, B, C,
and P, each with different expenses and dividends. You may purchase shares
at the net asset value ("NAV") per share determined after we receive your
purchase order submitted in proper form. A front-end sales charge may be
added to the NAV in the case of the class A shares. There is no front-end
sales charge in the case of the Class B, Class C, and Class P shares,
although there may be a contingent deferred sales charge ("CDSC") on Class
B and Class C shares as described below.

You should read this section carefully to determine which Class of shares
represents the best investment option for your particular situation. It may
not be suitable for you to place a purchase order for Class B shares of
$500,000 or more or a purchase order for Class C shares of $1,000,000 or
more. You should discuss purchase options with your investment
professional.

For more information, see "Alternative Sales Arrangements" in the Statement
of Additional Information.

We reserve the right to withdraw all or any part of the offering made by
this prospectus or to reject any purchase order. We also reserve the right
to waive or change minimum investment requirements. All purchase orders are
subject to our acceptance and are not binding until confirmed or accepted
in writing.

- --------------------------------------------------------------------------------
Share Classes
- --------------------------------------------------------------------------------

Class A o normally offered with a front-end sales charge

Class B o no front-end sales charge, however, a CDSC is applied to shares sold
prior to the sixth anniversary of purchase

o higher annual expenses than Class A shares

o automatically convert to Class A shares after eight years

Class C o no front-end sales charge

o higher annual expenses than Class A shares

o a CDSC is applied to shares sold prior to the first anniversary
of purchase

Class P o available to certain pension or retirement plans and pursuant to a
Mutual Fund Fee Based Program

- -------------------------------------------------------------------------------------------------------------------
Front-End Sales Charges - Class A Shares
(Growth & Income Series, International Series and Alpha Series)
- -------------------------------------------------------------------------------------------------------------------

To Compute
As a % of As a % of OfferingPrice
Your Investment Offering Price Your Investment Divide NAV by
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>

Less than $50,000 5.75% 6.10% .9425
- -------------------------------------------------------------------------------------------------------------------
$50,000 to $99,999 4.75% 4.99% .9525
- -------------------------------------------------------------------------------------------------------------------
$100,000 to $249,999 3.95% 4.11% .9605
- -------------------------------------------------------------------------------------------------------------------
$250,000 to $499,999 2.75% 2.83% .9725
- -------------------------------------------------------------------------------------------------------------------
$500,000 to $999,999 1.95% 1.99% .9805
- -------------------------------------------------------------------------------------------------------------------
$1,000,000 and over No Sales Charge 1.0000
- -------------------------------------------------------------------------------------------------------------------
</TABLE>

NAV per share for each Class of Fund shares is calculated each business day at
the close of regular trading on the New York Stock Exchange ("NYSE") normally
4:00 p.m. Eastern time. Purchases and sales of Fund shares are executed at the
NAV next determined after the Fund receives your order in proper form. In
calculating NAV, securities for which market quotations are available are valued
at those quotations. Securities for which such quotations are not available are
valued at fair value under procedures approved by the Board of the Funds.

Your Investment 15

<PAGE>

- -------------------------------------------------------------------------------------------------------------------
Front-End Sales Charges - Class A Shares
(World Bond-Debenture Series Only)
- -------------------------------------------------------------------------------------------------------------------

Less than $100,000 4.75% 4.99% .9525
- -------------------------------------------------------------------------------------------------------------------
$100,000 to $249,999 3.95% 4.11% .9605
- -------------------------------------------------------------------------------------------------------------------
$250,000 to $499,999 2.75% 2.83% .9725
- -------------------------------------------------------------------------------------------------------------------
$500,000 to $999,999 1.95% 1.99% .9805
- -------------------------------------------------------------------------------------------------------------------
$1,000,000 and over No Sales Charge 1.0000
- -------------------------------------------------------------------------------------------------------------------
</TABLE>

Reducing Your Class A Front-End Sales Charges. Class A shares may be
purchased at a discount if you qualify under either of the following
conditions:

o Rights of Accumulation -- A Purchaser can apply the value (at public
offering price) of the shares you already own to a new purchase of
Class A shares of any Eligible Fund in order to reduce the sales
charge.

o Statement of Intention -- A Purchaser of Class A shares may purchase
additional shares of any Eligible Fund over a 13-month period and
receive the same sales charge as if you had purchased all shares at
once. Shares purchased through reinvestment of dividends or
distributions are not included. A statement of intention may be
backdated 90 days. Current holdings under rights of accumulation can
be included in a statement of intention.

For more information on eligibility for these privileges, read the
applicable sections in the attached application.

Class A Share Purchases Without A Front-End Sales Charge. Class A shares
may be purchased without a front-end sales charge under any of the
following conditions:

o purchases of $1 million or more +

o purchases by Retirement Plans with at least 100 eligible employees +

o purchases under a Special Retirement Wrap Program +

o purchases made with dividends and distributions on Class A shares of
another Eligible Fund

o purchases representing repayment under the loan feature of the Lord
Abbett- sponsored prototype 403(b) Plan for Class A shares

o purchases by employees of any consenting securities dealer having a
sales agreement with Lord Abbett Distributor

o purchases under a Mutual Fund Fee Based Program

o purchases by trustees or custodians of any pension or profit sharing
plan, or payroll deduction IRA for employees of any consenting
securities dealer having a sales agreement with Lord Abbett
Distributor

See the Statement of Additional Information for a listing of other
categories of purchasers who qualify for Class A share purchases without a
front-end sales charge.

+ These categories may be subject to a CDSC.

Retirement Plans include employer-sponsored retirement plans under the Internal
Revenue Code, excluding Individual Retirement Accounts.

Lord Abbett offers a variety of Retirement Plans. Call 800-253-7299 for
information about:

o Traditional, Rollover, Roth and Education IRAs

o Simple IRAs, SEP-IRAs, 401(k) and 403(b) accounts

o Defined Contribution Plans

Lord Abbett Distributor LLC ("Lord Abbett Distributor") acts as agent for the
Funds to work with investment professionals that buy and/or sell shares of the
Funds on behalf of their clients. Generally, Lord Abbett Distributor does not
sell Fund shares directly to investors.

16 Your Investment

<PAGE>

Class A Share CDSC. If you buy Class A shares under one of the starred (+)
categories listed above and you redeem any within 24 months after the month
in which you initially purchased them, the Fund will normally collect a
CDSC of 1%.

The Class A share CDSC generally will be waived for the following
conditions:

o benefit payments under Retirement Plans, in connection with loans,
hardship withdrawals, death, disability, retirement, separation from
service or any excess distribution under Retirement Plans
(documentation may be required)

o redemptions continuing as investments in another fund participating in
a Special Retirement Wrap Program

Class B Share CDSC. The CDSC for Class B shares normally applies if you
redeem your shares before the sixth anniversary of their initial purchase.
The CDSC declines the longer you own your shares according to the following
schedule:

- --------------------------------------------------------------------------------
Contingent Deferred Sales Charges - Class B Shares
- --------------------------------------------------------------------------------

Anniversary(1) of the day on Contingent Deferred Sales Charge
which the purchase order on redemption (as % of amount
was accepted subject to charge)

On Before
- --------------------------------------------------------------------------------
1st 5.0%
- --------------------------------------------------------------------------------
1st 2nd 4.0%
- --------------------------------------------------------------------------------
2nd 3rd 3.0%
- --------------------------------------------------------------------------------
3rd 4th 3.0%
- --------------------------------------------------------------------------------
4th 5th 2.0%
- --------------------------------------------------------------------------------
5th 6th 1.0%
- --------------------------------------------------------------------------------
on or after the 6th(2) None
- --------------------------------------------------------------------------------

(1) The anniversary is the same calendar day in each respective year after the
date of purchase. For example, the anniversary for shares purchased on May
1 will be May 1 of each succeeding year.

(2) Class B shares will automatically convert to Class A shares on the eighth
anniversary of the purchase of Class B shares.

The Class B share CDSC generally will be waived under the following
circumstances:

o benefit payments under Retirement Plans in connection with loans,
hardship withdrawals, death, disability, retirement, separation from
service or any excess contribution or distribution under Retirement
Plans

o Eligible Mandatory Distributions under 403(b) Plans and individual
retirement accounts

o death of the shareholder

o redemptions of shares in connection with Div-Move and Systematic
Withdrawal Plans (up to 12% per year)

See "Systematic Withdrawal Plan" under "Services For Fund Investors" below
for more information on CDSCs with respect to Class B shares.

Class C Share CDSC. The 1% CDSC for Class C shares normally applies if you
redeem your shares before the first anniversary of the purchase of such
shares.

Class P Shares. Class P shares have lower annual expenses than Class B and
Class C shares, no front-end sales charge, and no CDSC. Class P shares are
currently sold and redeemed at NAV (a) pursuant to a Mutual Fund Fee Based
Program, or (b) to the trustees of, or employer-sponsors with respect to,
pension or retirement plans with at least 100 eligible employees (such as a
plan under Section 401(a), 401(k) or 457(b) of the

Benefit Payment Documentation. (Class A CDSC only)

o under $50,000 - no documentation necessary

o Over $50,000 - reason for benefit payment must be received in writing. Use
the address indicated under "Opening your Account."

CDSC, regardless of class, is not charged on shares acquired through
reinvestment of dividends or capital gains distributions and is charged on the
original purchase cost or the current market value of the shares at the time
they are being sold, which-ever is lower. In addition, repayment of loans under
Retirement Plans and 403(b) Plans will constitute new sales for purposes of
assessing the CDSC.

To minimize the amount of any CDSC, each Fund redeems shares in the following
order:

1. shares acquired by reinvestment of dividends and capital gains (always free
of a CDSC)

2. shares held for six years or more (Class B) or two years or more after the
month of purchase (Class A) or one year or more (Class C)

3. shares held the longest before the sixth anniversary of their purchase
(Class B) or before the second anniversary after the month of purchase
(Class A) or before the first anniversary of their purchase (Class C)

Your Investment 17

<PAGE>

Internal Revenue Code) which engage an investment professional providing or
participating in an agreement to provide certain recordkeeping,
administrative and/or sub-transfer agency services to the Fund on behalf of
the Class P shareholders.

SALES COMPENSATION

As part of its plan for distributing shares, each Fund and Lord Abbett
Distributor pay sales and service compensation to Authorized Institutions
that sell the Fund's shares and service its shareholder accounts.

Sales compensation originates from two sources as shown in the table "Fees
and Expenses": sales charges which are paid directly by shareholders; and
12b-1 distribution fees that are paid out of the Fund's assets. Service
compensation originates from 12b-1 service fees. The total 12b-1 fees
payable with respect to each share class of each Fund are up to .35% of
Class A shares (plus distribution fees of up to 1.00% on certain qualifying
purchases), 1.00% of Class B and C shares, and .45% of Class P shares. The
amounts payable as compensation to Authorized Institutions, such as your
dealer, are shown in the chart at the end of this prospectus. The portion
of such compensation paid to Lord Abbett Distributor is discussed under
"Sales Activities" and "Service Activities." Sometimes we do not pay
compensation where tracking data is not available for certain accounts or
where the Authorized Institution waives part of the compensation. In such
cases, we may not require payment of any otherwise applicable CDSC.

We may pay Additional Concessions to Authorized Institutions from time to
time.

Sales Activities. We may use 12b-1 distribution fees to pay Authorized
Institutions to finance any activity which is primarily intended to result
in the sale of shares. Lord Abbett Distributor uses its portion of the
distribution fees attributable to a Fund's Class A and Class C shares for
activities which are primarily intended to result in the sale of such Class
A and Class C shares, respectively. These activities include, but are not
limited to, printing of prospectuses and statements of additional
information and reports for other than existing shareholders, preparation
and distribution of advertising and sales material, expenses of organizing
and conducting sales seminars, Additional Concessions to Authorized
Institutions, the cost necessary to provide distribution-related services
or personnel, travel, office expenses, equipment and other allocable
overhead.

Service Activities. We may pay Rule 12b-1 service fees to Authorized
Institutions for any activity which is primarily intended to result in
personal service and/or the maintenance of shareholder accounts. Any
portion of the service fees paid to Lord Abbett Distributor will be used to
service and maintain shareholder accounts.

OPENING YOUR ACCOUNT

Minimum initial investment

o Regular Account $1,000
- --------------------------------------------------------------------------------
o Individual Retirement Accounts and
403(b) Plans under the Internal Revenue Code $250
- --------------------------------------------------------------------------------
o Uniform Gift to Minor Account $250
- --------------------------------------------------------------------------------

For Retirement Plans and Mutual Fund Fee Based Programs no minimum
investment is required, regardless of share class.

You may purchase shares through any independent securities dealer who has a
sales agreement with Lord Abbett Distributor or you can fill out the
attached application and

12b-1 fees are payable regardless of expenses. The amounts payable by a Fund
need not be directly related to expenses. If Lord Abbett Distributor's actual
expenses exceed the fee payable to it, the Fund will not have to pay more than
that fee. If Lord Abbett Distributor's expenses are less than the fee it
receives, Lord Abbett Distributor will keep the full amount of the fee.

18 Your Investment

<PAGE>

send it to the Fund you select at the address stated below. You should
carefully read the paragraph below entitled "Proper Form" before placing
your order to ensure that your order will be accepted.

Name of Fund
P.O. Box 219100
Kansas City, MO 64121

By Exchange. Telephone the Fund at 800-821-5129 to request an exchange from
any eligible Lord Abbett-sponsored fund.

Proper Form. An order submitted directly to the Fund must contain: (1) a
completed application, and (2) payment by check. When purchases are made by
check, redemption proceeds will not be paid until the Fund or transfer
agent is advised that the check has cleared, which may take up to 15
calendar days. For more information call the Fund at 800-821-5129.

REDEMPTIONS

By Broker. Call your investment professional for instructions on how to
redeem your shares.

By Telephone. To obtain the proceeds of a redemption of $50,000 or less
from your account, you or your representative should call the Fund at
800-821-5129.

By Mail. Submit a written redemption request indicating the name(s) in
which the account is registered, the Fund's name, the class of shares, your
account number, and the dollar value or number of shares you wish to sell.

Include all necessary signatures. If the signer has any Legal Capacity, the
signature and capacity must be guaranteed by an Eligible Guarantor. Certain
other legal documentation may be required. For more information regarding
proper documentation call 800-821-5129.

Normally a check will be mailed to the name(s) and address in which the
account is registered (or otherwise according to your instruction) within
three business days after receipt of your redemption request. Your account
balance must be sufficient to cover the amount being redeemed or your
redemption order will not be processed. Under unusual circumstances, the
Fund may suspend redemptions, or postpone payment for more than seven days,
as permitted by federal securities laws.

To determine if a CDSC applies to a redemption, see "Class A share CDSC,"
"Class B share CDSC" or "Class C share CDSC."

DISTRIBUTIONS AND TAXES

Each Fund normally pays dividends from its net investment income as
follows: semi-annually for the Growth & Income Series; annually for the
International Series and the Alpha Series; and monthly for the World Bond-
Debenture Series. Each Fund distributes net capital gains (if any) as
capital gains distributions on an annual basis. Your distributions will be
reinvested in your Fund unless you instruct the Fund to pay them to you in
cash. There are no sales charges on reinvestments. The tax status of
distributions is the same for all shareholders regardless of how long they
have owned Fund shares or whether distributions are reinvested or paid in
cash.

Except in tax-advantaged accounts, any sale, redemption or exchange of Fund
shares may be taxable to the shareholder.

Small Accounts. Our Board may authorize closing any account in which there are
fewer than 25 shares if it is the Fund's best interest to do so.

Eligible Guarantor is any broker or bank that is a member of the medallion stamp
program. Most major securities firms and banks are members of this program. A
notary public is not an eligible guarantor.

Your Investment 19

<PAGE>

Information on the tax treatment of distributions, including the source of
dividends and distributions of capital gains by each Fund, will be mailed
to shareholders each year. Because everyone's tax situation is unique, you
should consult your tax adviser regarding the treatment of distributions
under the federal, state and local tax rules that apply to you.

SERVICES FOR FUND INVESTORS

AUTOMATIC SERVICES

Buying or selling shares automatically is easy with the services described
below. With each service, you select a schedule and amount, subject to
certain restrictions. You may set up most of these services when filling
out your application or by calling 800-821-5129.

- -------------------------------------------------------------------------------------------------------------------
<S> <C>
For investing

Invest-A-Matic You can make fixed, periodic investments ($50 minimum) into your Fund
(Dollar-cost account by means of automatic money transfers from your bank
checking averaging) account. See the attached application for instructions.

Div-Move You can automatically reinvest the dividends and distributions from
your account into another account in any Eligible Fund ($50 minimum).

For selling shares

Systematic You can make regular withdrawals from most Lord Abbett Funds.
Withdrawal Automatic cash withdrawals will be paid to you from your account in
("SWP") fixed or variable Plan amounts. To establish a plan, the value of your
shares must be at least $10,000, except for Retirement Plans for which there is
no minimum.

Class B shares The CDSC will be waived on SWP redemptions of up to 12% of the
current net asset value of your account at the time of your SWP request. For
Class B share SWP redemptions over 12% per year, the CDSC will apply to the
entire redemption. Please contact the Fund for assistance in minimizing the CDSC
in this situation.

Class B and Redemption proceeds due to a SWP for Class B and Class C shares will be
C shares redeemed in the order described under "Purchases."
- -------------------------------------------------------------------------------------------------------------------
</TABLE>

OTHER SERVICES

Telephone Investing. After we have received the attached application
(selecting "yes" under Section 7C and completing Section 7), you may
instruct us by phone to have money transferred from your bank account to
purchase shares of the Fund for an existing account. The Fund will purchase
the requested shares when it receives the money from your bank.

Exchanges. You or your investment professional may instruct the Fund to
exchange shares of any class for shares of the same class of any Eligible
Fund. Instruction may be provided in writing or by telephone, with proper
identification, by calling 800-821-5129. The Fund must receive instructions
for the exchange before the close of the NYSE on the day of your call in
which case you will get the NAV per share of the Eligible Fund determined
on that day. Exchanges will be treated as a sale for federal tax purposes.
Be sure to read the current prospectus for any fund into which you are
exchanging.

Reinvestment Privilege. If you sell shares of the Fund, you have a one time
right to reinvest some or all of the proceeds in the same class of any
Eligible Fund within 60 days without a sales charge. If you paid a CDSC
when you sold your shares, you will be credited with the amount of the
CDSC. All accounts involved must have the same registration.

Telephone Transactions. You have this privilege unless you refuse it in writing.
For your security, telephone transaction requests are recorded. We will take
measures to verify the identity of the caller, such as asking for your name,
account number, social security or taxpayer identification number and other
relevant information. The Funds will not be liable for following instructions
communicated by telephone that they reasonably believe to be genuine.

Transactions by telephone may be difficult to implement in times of drastic
economic or market change.

Exchange Limitations. Exchanges should not be used to try to take advantage of
short-term swings in the market. Frequent exchanges create higher expenses for
the Funds. Accordingly, the Funds reserve the right to limit or terminate this
privilege for any shareholder making frequent exchanges or abusing the
privilege. The Fund also may revoke the privilege for all shareholders upon 60
days' written notice.

20 Your Investment

<PAGE>

Account Statements. Every Lord Abbett investor automatically receives
quarterly account statements.

Householding. Shareholders with the same last name and address will receive
a single copy of a prospectus and an annual and semi-annual report, unless
additional reports are specifically requested in writing to the Fund.

Account Changes. For any changes you need to make to your account, consult
your investment professional or call the Fund at 800-821-5129.

Systematic Exchange. You or your investment professional can establish a
schedule of exchanges between the same classes of any Eligible Fund.

MANAGEMENT

The Funds' investment adviser is Lord, Abbett & Co., which is located at 90
Hudson Street, Jersey City, NJ 07302-3973. Founded in 1929, Lord Abbett
manages one of the nation's oldest mutual fund complexes, with
approximately $35 billion in more than 40 mutual fund portfolios and other
advisory accounts. For more information about the services Lord Abbett
provides to the Funds, see the Statement of Additional Information.

Lord Abbett is entitled to a fee based on each Funds' average daily net
assets for each month. For the fiscal year ended October 31, 1999, the fee
paid to Lord Abbett was at an annual rate of .75 of 1% for the
International Series. For the same period the fee paid to Lord Abbett for
the Growth & Income Series was calculated at the following annual rates:

.75 of 1% on the first $200 million of average daily net assets,
.65 of 1% on the next $300 million,
.50 of 1% of the Series' assets over $500 million.

Based on this calculation, the management fee paid to Lord Abbett for the
fiscal year ended October 31, 1999 with respect to the Growth & Income
Series was an annual rate of .75% of 1% of this Fund's average daily net
assets.

Lord Abbett is entitled to an annual management fee at a rate of .75% of
1% of the World Bond-Debenture Series and .50% of 1% of the Alpha Series'
average daily net assets. The fee is calculated and payable monthly. For
the fiscal year ended October 31, 1999, Lord Abbett waived its entire
management fee for each of the World Bond-Debenture Series and the Alpha
Series. In addition, the Funds pay all expenses not expressly assumed by
Lord Abbett.

Lord Abbett uses teams of portfolio managers and analysts acting together
to manage the Funds' investments.

Growth & Income Series. The portfolio management team is headed by Robert
G. Morris, W. Thomas Hudson and Eli Salzman. Messrs. Morris and Hudson,
Partners of Lord Abbett, have been with Lord Abbett for more than five
years. Mr. Salzman joined Lord Abbett in 1997; prior to that he was a Vice
President with Mutual of America Capital Corp. from 1996 to 1997, and was a
Vice President at Mitchell Hutchins Asset Management, Inc. from 1986 to
1996.

International Series. Christopher J. Taylor is Managing Director of the
sub-adviser of the Fund, Fuji-Lord Abbett International Ltd., of which Lord
Abbett is a minority owner (formerly named Fuji Investment Management Co.
(Europe) Ltd.). Mr. Taylor heads the team, the senior member of which is
David Shaw, U.K. Equity Fund Manager. Mr. Shaw joined Fuji-Lord Abbett
International Ltd. in 1999 and previously was U.K. Fund Manager at National
Provident Institutions Asset Management from 1996 to 1999, a Senior
Investment Analyst at NatWest Investment Management from 1995 to 1996, and
was U.K. Investment Analyst at United Friendly Asset Management from 1992
to 1995. Mr. Taylor has been employed by the sub-adviser and its
predecessor companies since 1987.

Your Investment 21

<PAGE>

World Bond-Debenture Series. Zane E. Brown, Partner of Lord Abbett, heads
the team, the senior members of which are Christopher J. Towle, Timothy W.
Horan, Jerald M. Lanzotti and Fernando B. Saldanha. Mr. Brown and Mr. Towle
have each been with Lord Abbett for over five years. Mr. Horan joined Lord
Abbett in 1996; prior to that he was a member of Senior Management at
Credit Suisse from 1994-1996. Mr. Lanzotti joined Lord Abbett in 1996;
prior to that he was an Associate in Global Fixed Income at Deutsche Morgan
Grenfell from 1993-1996. Mr. Saldanha joined Lord Abbett in 1998; prior to
that he was a Senior Financial Officer at World Bank from 1988-1998.

Alpha Series. Robert G. Morris, Partner of Lord Abbett, heads the team,
which includes the senior managers of three underlying funds: Steven J.
McGruder, Developing Growth Fund; Christopher J. Taylor, International
Series; and Robert P. Fetch, Small-Cap Value Series. Mr. Morris has been
with Lord Abbett for more than five years. Mr. McGruder joined Lord Abbett
in 1995; prior to then he was a Vice President of Wafra Investment Advisory
Group, a private investment company, from 1988-1995. Christopher J. Taylor
has been employed by Fuji-Lord Abbett International Ltd., the sub-adviser
for the Fund of which Lord Abbett is a minority owner, and its predecessor
companies since 1987. Robert P. Fetch, Partner of Lord Abbett, has been
with Lord Abbett since 1995; prior to that he was a Managing Director of
Prudential Investment Advisors from 1983 to 1995.

22 Your Investment

<PAGE>

FOR MORE INFORMATION

OTHER INVESTMENT TECHNIQUES

This section describes some of the investment techniques that might be used
by the Funds and their risks.

Adjusting Investment Exposure. Each Fund may, but is not required to, use
various strategies to change its investment exposure to adjust to changing
security prices, interest rates, currency exchange rates, commodity prices
and other factors. These strategies may involve buying or selling
derivative instruments, such as options and futures contracts, swap
agreements including interest rate swaps, caps, floors, collars and rights
and warrants. Each Fund may use these transactions to change the risk and
return characteristics of its portfolio. If we judge market
conditions incorrectly or use a strategy that does not correlate well with
a Fund's investments, it could result in a loss, even if we intended to
lessen risk or enhance returns. These transactions may involve a small
investment of cash compared to the magnitude of the risk assumed and could
produce disproportionate gains or losses. Also, these strategies could
result in losses if the counterparty to a transaction does not perform as
promised.

Depository Receipts. The International Series and the Small-Cap Value
Series may invest in Depository Receipts, which are securities, typically
issued by a financial institution (a "depository"), that evidence ownership
interests in a security or a pool of securities issued by a foreign issuer
(the "underlying issuer") and deposited with the depository. Generally,
Depository Receipts in registered form are designed for use in U.S.
securities market and Depository Receipts in bearer form are designed for
use in securities markets outside the United States. These Funds may invest
in sponsored and unsponsored Depository Receipts. For purposes of the
International Series' investment policies, investments in Depository
Receipts will be deemed to be investments in the underlying securities.

Emerging Countries Risk. Both the International Series and the World
Bond-Debenture Series may invest in emerging country securities. The
securities markets of emerging countries are less liquid, are especially
subject to greater price volatility, have smaller market capitalizations,
have less government regulation and are not subject to as extensive and
frequent accounting, financial and other reporting requirements as the
securities markets of more developed countries. Further, investing in the
securities of issuers located in certain emerging countries may involve a
risk of loss resulting from problems in security registration and custody
or substantial economic or political disruptions. These risks are not
normally associated with investments in more developed countries.

Equity Securities. These include common stocks, preferred stocks,
convertible securities, warrants, and similar instruments. Common stocks,
the most familiar type, represent an ownership interest in a corporation.
Although equity securities have a history of long-term growth in their
value, their prices fluctuate based on changes in a company's financial
condition and on market and economic conditions.

Foreign Currency Transactions. The International Series and the World
Bond-Debenture Series may purchase or sell foreign currencies on a cash
basis or through forward contracts. A forward contract involves an
obligation to purchase or sell a specific currency at a future date at a
price set at the time of the contract. Although the International Series
and World Bond-Debenture Series do not normally engage in extensive
currency hedging, they may use foreign currency transactions to seek to

For More Information 23

<PAGE>

protect against anticipated changes in future foreign currency exchange
rates. It may be difficult or impractical to hedge currency risk in many
emerging countries.

In addition, the International Series and the World Bond-Debenture Series
may enter into such transactions to seek to increase total return, which is
considered a speculative practice. These Funds generally would not enter
into a forward contract with a term greater than one year. Under some
circumstances, a Fund may commit a substantial portion or the entire value
of its portfolio to the completion of forward contracts.

The use of foreign currency transactions is subject to the general risk
that the portfolio managers will not accurately predict currency movements,
and the Funds' returns could be reduced. In addition, forward foreign
currency exchange contracts and other privately negotiated currency
instruments offer less protection against defaults than is available for
currency instruments traded on an exchange. Since these contracts are not
guaranteed by an exchange or clearinghouse, a default on a contract would
deprive a Fund of unrealized profits, transaction costs, or the benefits of
a currency hedge, or could force the Fund to cover its purchase or sale
commitments, if any, at the current market price. Currency exchange rates
may fluctuate significantly over short periods of time, causing the NAV of
the International Series or the World Bond-Debenture Series to fluctuate.
Currency exchange rates may be affected unpredictably by the intervention
of U.S. or foreign governments or central banks, or the failure to
intervene, or by currency controls or political developments in the United
States or abroad.

Foreign Securities. The International Series and the World Bond-Debenture
Series may invest all of their assets in foreign securities; the Growth &
Income Series may invest 10% of its assets in foreign securities. The
underlying funds in which the Alpha Series invests may also invest in
foreign securities. Foreign markets and the securities traded in them are
not subject to the same degree of regulation as U.S. markets. Securities
clearance and settlement procedures may be different in foreign countries.
There may be less trading volume in foreign markets, subjecting the
securities traded in them to higher price fluctuations. Transaction costs
may be higher in foreign markets. A Fund may hold foreign securities which
trade on days when the Fund does not sell shares. As a result, the value of
the Fund's portfolio securities may change on days an investor may not
purchase or sell Fund shares.

Foreign issuers are generally not subject to similar, uniform accounting,
auditing and financial reporting requirements as U.S. issuers. Foreign
investments may be affected by changes in currency rates or currency
controls. Certain foreign countries may limit a Fund's ability to remove
its assets from the country. With respect to certain foreign countries,
there is a possibility of nationalization, expropriation or confiscatory
taxation, imposition of withholding or other taxes, and political or
social instability which could affect investments in those countries.

Futures Contracts and Options on Futures Contracts. The International
Series may enter into financial futures transactions. A financial futures
transaction is the purchase or sale of an exchange-traded contract to buy
or sell a specified financial instrument or index at a specific future date
and price. The International Series will not enter into any futures
contracts, or options thereon, if the aggregate market value of the
securities covered by futures contracts plus options on such financial
futures exceeds 50% of its total assets.

High Yield Debt Securities. The World Bond-Debenture Series may invest
substantially all of its assets and each of the Growth & Income Series and
Small-Cap Value Series may invest up to 5% of their net assets measured at
the time of investment in high yield debt securities. High yield debt
securities or "junk bonds" are rated BB/Ba or lower and typically pay a
higher yield than investment grade debt securities. These bonds have a
higher

24 For More Information

<PAGE>

risk of default than investment grade bonds and their prices can be much
more volatile.

Investment Funds. In addition to the Alpha Series, which invests in
investment funds, the International Series and the World Bond-Debenture
Series may invest (normally not more than 5% of the Fund's total assets) in
investment funds. Some emerging countries have laws and regulations that
currently preclude direct foreign investment in the securities of their
companies. However, indirect foreign investment in the securities of such
countries is permitted through investment funds which have been
specifically authorized. If a Fund invests in such investment funds, its
shareholders will bear not only their proportionate share of the expenses
of the Fund (including operating expenses and the fees of Lord Abbett), but
also will indirectly bear similar expenses of the underlying investment
funds.

Investment Grade Debt Securities. These are debt securities which are rated
in one of the four highest grades assigned by Moody's Investors Service,
Inc., Standard & Poor's Ratings Services or Fitch Investors Service, or are
unrated but determined by Lord Abbett to be equivalent in quality.

Options Transactions. The International Series may purchase and write put
and call options on equity securities or stock indices that are traded on
national securities exchanges.

A put option gives the buyer of the option the right to sell, and the
seller of the option the obligation to buy, the underlying instrument
during the option period. The International Series may write only covered
put options to the extent that cover for such options does not exceed 25%
of the Fund's net assets. The International Series will not purchase an
option if, as a result of such purchase, more than 5% of its net assets
would be invested in premiums for such options.

A call option gives the buyer of the option the right to buy, and the
writer (seller) of the option the obligation to sell, the underlying
instrument. The International Series may only sell (write) covered call
options. This means that the International Series may only sell call
options on securities it owns.When the International Series writes a call
option it gives up the potential for gain on the underlying securities in
excess of the exercise price of the option during the period that the
option is open.

Risks of Futures Contracts and Options Transactions. The International
Series transactions, if any, in futures, options on futures and other
options involve additional risk of loss. Loss may result from a lack of
correlation between changes in the value of these derivative instruments
and the International Series assets being hedged, the potential illiquidity
of the markets for derivative instruments, or the risks arising from margin
requirements and related leverage factors associated with such
transactions. The use of these investment techniques also involves the risk
of loss if the portfolio managers are incorrect in their expectation of
fluctuations in securities prices. In addition, the loss that may be
incurred by the International Series in entering into futures contracts and
in writing call options on futures is potentially unlimited and may exceed
the amount of the premium received.

Portfolio Securities Lending. Each Fund may lend securities to
broker-dealers and financial institutions as a means of earning income.
This practice could result in a loss or delay in recovering a Fund's
securities if the borrower defaults. Each Fund will limit its securities
loans to 5% of its total assets and all loans will be fully collateralized.

Repurchase Agreements. Each Fund may enter into Repurchase Agreements. In
the case of the Alpha Series, each underlying fund except Developing Growth
Fund may enter into Repurchase Agreements. In a Repurchase Agreement, a
Fund buys a security at one price from a broker-dealer or financial
institution and simultaneously agrees to sell the same security back to the
same party at a higher price in the future. If the other party to the
agreement defaults or becomes insolvent, the Fund could lose money.

For More Information 25

<PAGE>

Short-Term Fixed-Income Securities. Each Fund and each underlying fund is
authorized to invest temporarily in certain short-term fixed income
securities. Such securities may be used to invest uncommitted cash
balances, to maintain liquidity to meet shareholder redemptions, or to take
a temporary defensive position against market declines. These securities
include: obligations of the U.S. government and its agencies and
instrumentalities; commercial paper, bank certificates of deposit, and
bankers' acceptances; and repurchase agreements collateralized by these
securities (except in the case of the Developing Growth Fund, which does
not engage in repurchase agreements).

Structured Securities. World Bond-Debenture Series may invest in structured
securities. Structured securities are securities whose value is determined
by reference to changes in the value of specific currencies, interest
rates, commodities, indices or other financial indicators (the "Reference")
or the relative change in two or more References. The interest rate or the
principal amount payable upon maturity or redemption may be increased or
decreased depending upon changes in the applicable Reference. Structured
securities may be positively or negatively indexed, so the appreciation of
the Reference may produce an increase or decrease in the interest rate on
value of the security at maturity. In addition, changes in the interest
rates or the value of the security at maturity may be a multiple of changes
in the value of the Reference. Consequently, structured securities may
present a greater degree of market risk than other types of fixed-income
securities, and may be more volatile, less liquid and more difficult to
price accurately than less complex securities.

U.S. Government Securities. These are obligations issued or guaranteed by
the U.S. Government, its agencies or instrumentalities.

When-Issued or Delayed Delivery Transactions. Each Fund may purchase or
sell securities with payment and delivery taking place as much as a month
or more later. In the case of Alpha Series, each underlying fund, except
Developing Growth Fund, may do this in an effort to buy or sell the
securities at an advantageous price and yield. The securities involved are
subject to market fluctuation and no interest accrues to the purchaser
during the period between purchase and settlement. At the time of delivery
of the securities, their market value may be less than the purchase price.
Also, if a Fund commits a significant amount of assets to when-issued or
delayed delivery transactions, it may increase the volatility of the Fund's
net asset value.

Zero Coupon, Deferred Interest, Pay-In-Kind and Capital Appreciation Bonds.
The World Bond-Debenture Series may invest in zero coupon, deferred
interest, pay-in-kind and capital appreciation bonds. These securities are
issued at a discount from their face value because interest payments are
typically postponed until maturity. Pay-in-kind securities are securities
that have interest payable by the delivery of additional securities. The
market prices of these securities 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.

GLOSSARY OF SHADED TERMS

Additional Concessions. Lord Abbett Distributor may, for specified periods,
allow dealers to retain the full sales charge for sales of shares or may
pay an additional concession to a dealer who sells a minimum dollar amount
of our shares and/or shares of other Lord Abbett-sponsored funds. In some
instances, such additional concessions will be offered only to certain
dealers expected to sell significant amounts of shares. Additional payments
may be paid from Lord Abbett Distributor's own resources or from
distribution fees received from a Fund and will be made in the form of cash
or, if permitted, non-cash

26 For More Information

<PAGE>

payments. The non-cash payments will include business seminars at Lord
Abbett's headquarters or other locations, including meals and
entertainment, or the receipt of merchandise. The cash payments may include
payment of various business expenses of the dealer.

In selecting dealers to execute portfolio transactions for a Fund's
portfolio, if two or more dealers are considered capable of obtaining best
execution, we may prefer the dealer who has sold our shares and/or shares
of other Lord Abbett-sponsored funds.

Authorized Institutions. Institutions and persons permitted by law to
receive service and/or distribution fees under a Rule 12b-1 Plan are
"Authorized Institutions." Lord Abbett Distributor is an Authorized
Institution.

Eligible Fund. An Eligible Fund is any Lord Abbett-sponsored fund except
for (1) certain tax-free, single-state funds where the exchanging
shareholder is a resident of a state in which such a fund is not offered
for sale; (2) Lord Abbett Equity Fund; (3) Lord Abbett Series Fund; (4)
Lord Abbett U.S. Government Securities Money Market Fund ("GSMMF") (except
for holdings in GSMMF which are attributable to any shares exchanged from
the Lord Abbett family of funds). An Eligible Fund also is any Authorized
Institution's affiliated money market fund satisfying Lord Abbett
Distributor as to certain omnibus account and other criteria.

Eligible Mandatory Distributions. If Class B shares represent a part of an
individual's total IRA or 403(b) investment, the CDSC will be waived only
for that part of a mandatory distribution which bears the same relation to
the entire mandatory distribution as the Class B share investment bears
to the total investment.

Legal Capacity. With respect to a redemption request, if (for example) the
request is on behalf of the estate of a deceased shareholder, John W. Doe,
by a person (Robert A. Doe) who has the legal capacity to act for the
estate of the deceased shareholder because he is the executor of the
estate, then the request must be executed as follows: Robert A.Doe,
Executor of the Estate of John W. Doe. That signature using that capacity
must be guaranteed by an Eligible Guarantor.

Similarly, if (for example) the redemption request is on behalf of the ABC
Corporation by a person (Mary B. Doe) that has the legal capacity to act on
behalf of this corporation, because she is the President of the
corporation, then the request must be executed as follows: ABC Corporation
by Mary B.Doe, President. That signature using that capacity must be
guaranteed by an Eligible Guarantor (see example in right column).

Mutual Fund Fee Based Program. Certain unaffiliated authorized brokers,
dealers, registered investment advisers or other financial institutions
("entities") who either (1) have an arrangement with Lord Abbett
Distributor in accordance with certain standards approved by Lord Abbett
Distributor, providing specifically for the use of our shares (and
sometimes providing for acceptance of orders for such shares on our behalf)
in particular investment products made available for a fee to clients of
such entities, or (2) charge an advisory, consulting or other fee for their
services and buy shares for their own accounts or the accounts of their
clients.

Purchaser. The term "purchaser" includes: (1) an individual, (2) an
individual and his or her spouse and children under the age of 21, and (3)
a trustee or other fiduciary purchasing shares for a single trust estate or
single fiduciary account (including a pension, profit-sharing, or other
employee benefit trust qualified under Section 401 of the Internal Revenue
Code - more than one qualified employee benefit trust of a single employer,
including its consolidated subsidiaries, may be considered a single trust,
as may qualified plans of multiple employers registered in the name of a
single bank trustee as one account), although more than one beneficiary is
involved.

GUARANTEED SIGNATURE. An acceptable form of guarantee would be as follows:

In the case of the estate --

Robert A. Doe
Executor of the Estate of
John W. Doe

[Date]

SIGNATURE GUARANTEED
MEDALLION GUARANTEED
NAME OF GUARANTOR

[SIGNATURE ILLEGIBLE]
- --------------------------------------------------
AUTHORIZED SIGNATURE
(960) X 9 6 0 3 4 7 0
SECURITIES TRANSFER AGENTS MEDALLION PROGRAM'sm'
SR

In the case of the corporation --
ABC Corporation

Mary B. Doe

By Mary B. Doe, President

[Date]

SIGNATURE GUARANTEED
MEDALLION GUARANTEED
NAME OF GUARANTOR

[SIGNATURE ILLEGIBLE]
- --------------------------------------------------
AUTHORIZED SIGNATURE
(960) X 9 6 0 3 4 7 0
SECURITIES TRANSFER AGENTS MEDALLION PROGRAM'sm'
SR

For More Information 27

<PAGE>

Special Retirement Wrap Program. A program sponsored by an Authorized
Institution showing one or more characteristics distinguishing it, in the
opinion of Lord Abbett Distributor from a Mutual Fund Fee Based Program.
Such characteristics include, among other things, the fact that an
Authorized Institution does not charge its clients any fee of a consulting
or advisory nature that is economically equivalent to the distribution fee
under the Class A 12b-1 Plan and the fact that the program relates to
participant- directed Retirement Plans.

RECENT PERFORMANCE

The following is a discussion of recent performance for the 12 month period
ending October 31, 1999.

Growth & Income. Evidence of a possible global economic recovery emerged
early in 1999. By mid-year, it became apparent that global economic
conditions were generally improving, as reflected in increasing demand for
commodities such as paper, metals and chemicals. Much of the global rebound
was attributed to the Federal Reserve Board's move in the autumn of 1998 to
lower U.S. interest rates in an effort to pump liquidity into many of the
world's faltering economies. As global markets continued to improve
throughout 1999, the Federal Reserve Board decided that this stimulus was
no longer needed, resulting in a series of fall rate hikes that have
normalized U.S. interest rates from their record lows last year. Overall,
GDP growth in the U.S. remained strong throughout the period, with a
healthy labor market generating steady production and income gains.

Rising interest rates in mid to late 1999 caused a leadership shift in the
large-cap market as interest-rate-sensitive sectors, such as utilities and
financial services, underperformed, while technology stocks demonstrated
tremendous relative strength despite their high valuations. Over the course
of 1999, the Series remained underweighted in the financial sector, in
anticipation of rising interest rates. Likewise, we were well-positioned to
benefit from the leadership position of the technology sector, with select
holdings generating strong gains. We also increased our exposure in basic
materials industries, in anticipation of further global economic recovery
throughout 2000 and 2001.

International Series. During the last months of 1998, many of the world's
financial markets began to signal a possible recovery from a two-year
period of financial crisis and global deflation. By mid 1999, it became
apparent that this recovery was real, as economic indicators pointed to a
new phase of global economic expansion.

In the international equity markets, Europe, which remained subdued
throughout much of the period, rallied when recession fears proved false.
In addition, many European companies posted better-than-expected earnings
growth in late 1999 due to a solid local economy and a weak euro, relative
to the dollar and the yen, which boosted exports. Japan, which benefited
from a series of economic initiatives during the period, continued to show
signs of improvement, as it attracted overseas money on the strength of its
apparent recovery and its relative importance to international investors.

The Fund continued to implement its investment strategy of focusing on
attractively priced, industry-dominant companies with global leadership
potential. During the period, the Fund remained overweighted in European
and Canadian companies that demonstrated superior corporate earnings growth
rates and attractive valuation levels relative to many companies in the Far
East and emerging markets. In general, we limited our exposure to Japanese
companies in traditional, old-style industries such as steel, chemicals and
paper, because we believe they require further corporate restructuring. In
addi-

28 For More Information

<PAGE>

tion, the sluggishness of Japan's overall economy does not bode well for
those industries. However, the Fund has invested in select Japanese
companies within new-style industries, such as telecommunications and
software. Indeed, a handful of these high-tech issues have accounted for
the majority of recent gains in the Japanese markets.

World Bond-Debenture Series. Stronger global economic growth and a rebound
in commodities prices were central themes throughout 1999. As expected, the
U.S. Federal Reserve Board, as well as several key European Central Banks,
responded to this growth and the ensuing concerns about inflation with
interest rate hikes over the last few months of 1999. In general, global
growth has benefited many emerging market countries which tend to be
commodity producers.

The Fund performed well during the period compared to the Lipper Global
Income Funds Index. Much of the Fund's global high-yield investment gains
were generated in the cable and telecommunications sectors where the
consolidation of several European companies increased demand for these
issues. In the convertible sector, the Fund added value for shareholders by
increasing exposure to investment-grade convertible issues, both in the
U.S. and in Europe. In the emerging markets, the Fund benefited from its
positions in South Korean sovereign debt, which was recently upgraded to
investment grade, as well as from positions in other higher-yielding,
emerging market credits such as Malaysia, Mexico and Bulgaria. Even the
recent rate hikes by three major central banks - the U.S. Federal Reserve,
the European Central Bank and the Bank of England - have failed to blunt
the appetite for emerging markets debt. Another rate increase may, however,
call into question any further spread tightening.

Alpha Series. Despite a brief rally during the second quarter of 1999, the
small-cap market in the U.S. lagged the robust performance of the broad
market. Much of this underperformance can be attributed to the rise in
interest rates in mid to late 1999, which particularly affected
lower-liquidity, small-cap issues. Within the small-cap arena, the
small-cap growth sector was positively influenced by the continuing
outperformance of Internet-related stocks, while the less-liquid small-cap
value sector continued to lag.

Investors exhibited renewed confidence in European markets in late
1999, as recessionary fears proved false and corporate earnings rebounded
from subdued levels. As concerns about renewed inflation and the stability
of emerging markets eased, investors around the world became more confident
that the promise of global economic recovery had become a reality. During
the period, many of the world's stock markets, particularly the U.S., Japan
and the Far Eastern emerging markets, rose significantly. Japanese markets
benefited from improved investor sentiment as its economy continued to show
signs of recovery.

Technology stocks drove the small-cap growth sector during the period, and
the Fund was well-positioned to benefit from these advances. Select
holdings in the energy and retail sectors also performed well.

As uncertainty regarding U.S. interest rates intensified, the Fund reduced
its positions in economically sensitive industries such as banking, housing
and autos, in favor of sectors such as technology and consumer goods.
Select holdings in the energy sector, which benefited from rebounding
global commodities prices, also added value for shareholders.

The Fund continued to focus on "Best of Breed" companies: those that show
exceptional global leadership potential in their respective industries. We
maintained an overweighting in European and Canadian companies which
exhibited promising growth rates and attractive valuation levels and strong
gains were generated in most of our U.K. holdings. Select investments were
also made in "New-Japan-style" companies, including technology, software
and Internet ventures, which have accounted for the majority of Japanese
market gains in late 1999.

For More Information 29

<PAGE>

Growth & Income Series

FINANCIAL INFORMATION

FINANCIAL HIGHLIGHTS

This table describes the Fund's performance for the fiscal periods
indicated. "Total return" shows how much your investment in the Fund would
have increased (or decreased) during each period, assuming you had
reinvested all dividends and distributions. These Financial Highlights have
been audited by Deloitte & Touche LLP, the Fund's independent auditors, in
conjunction with their annual audit of the Fund's financial statements.
Financial statements for the fiscal year ended October 31, 1999 and the
Independent Auditors' Report thereon appear in the Annual Report to
Shareholders for the fiscal year ended October 31, 1999 and are
incorporated by reference into the Statement of Additional Information,
which is available upon request. Certain information reflects financial
results for a single Fund share.

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Class A Shares
---------------------------------------------------------------------------
Year Ended October 31,
Per Share Operating Performance: 1999 1998 1997 1996(a)

<S> <C> <C> <C> <C>
Net asset value, beginning of period $9.15 $8.79 $7.09 $6.50
Income from investment operations
Net investment income .04(e) .057 .093 .028
Net realized and unrealized
gain on investments 2.06 .928 1.781 .589
Total from investment operations 2.10 .985 1.874 .617
Distributions
Dividends from net investment income (.05) (.035) (.099) (.027)
Distributions from net realized gain (.33) (.590) (.075) --
Net asset value, end of period $10.87 $9.15 $8.79 $7.09
Total Return(b) 23.77% 11.97% 26.78% 12.10%(c)
Ratios to Average Net Assets:
Expenses, including waiver 1.30%(f) 1.22% 1.29% 0.39%(c)
Expenses, excluding waiver 1.30%(f) 1.22% 1.29% 0.39%(c)
Net investment income .36% 0.88% 1.15% 0.40%(c)
</TABLE>

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Class B Shares Class C Shares
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, Year Ended October 31,
------------------------- -----------------------------------------------
Per Share Operating Performance: 1999 1998 1997(a) 1999 1998 1997 1996 1995

<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of $9.13 $8.80 $8.20 $9.11 $8.80 $7.09 $6.04 $5.07
period
Income from investment operations
Net investment income .04(e) --(d) --(d) (.03)(e) .011 .032 .0949 .12
Net realized and unrealized
gain on securities 2.10 .92 .60 2.07 .889 1.790 1.0986 .97
Total from investment operations 2.06 .92 .60 2.04 .900 1.822 1.1935 1.09
Distributions
Dividends from net investment (.01) -- -- (.01) -- (.037) (.1035) (.12)
income
Distributions from net realized (.33) (.590) -- (.33) (.590) (.075) (.04) --
gain
Net asset value, end of period $10.85 $9.13 $8.80 $10.81 $9.11 $8.80 $7.09 $6.04
Total Return(b) 23.17% 11.17% 7.19%(c) 23.00% 10.94% 26.24% 20.02% 21.83%
Ratios to Average Net Assets:
Expenses, including waiver 1.98%(f) 1.98% 0.86%(c) 1.98%(f) 1.98% 2.05% 1.55% 1.16%
Expenses, excluding waiver 1.98%(f) 1.98% 0.86%(c) 1.98%(f) 1.98% 2.05% 2.01% 1.91%
Net investment income (.38)% 0.09% 0.01%(c) (.31)% 0.12% 0.39% 1.36% 2.06%

Year Ended October 31,
--------------------------------------------------------------------------------------------------
Supplemental Data For All Classes: 1999 1998 1997 1996 1995
Net assets, end of period (000) $216,797 $165,904 $142,992 $113,962 $32,770
Portfolio turnover rate 37.68% 45.83% 36.37% 23.84% 23.17%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(a) From commencement of operations for each Class of shares: July 15, 1996
(Class A) and June 5, 1997 (Class B).
(b) Total return does not consider the effects of sales loads and assumes the
reinvestment of all distributions.
(c) Not annualized.
(d) Amount less than $0.01.
(e) Calculated using average shares outstanding during the year.
(f) The ratio includes expenses paid through an expense offset arrangement.

30 Financial Information

<PAGE>

Line Graph Comparison

Immediately below is a comparison of a $10,000 investment in Class C shares
to the same investment in the S&P 500(R) Index and the S&P Barra Value
Index, assuming reinvestment of all dividends and distributions.

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

[GRAPHIC OMITTED]

NAV S&P 500 S&P Barra Value
01/03/94 10000 10000 10000
10/31/94 10262 10360 10231
10/31/95 12502 13096 12587
10/31/96 15006 16250 15685
10/31/97 18943 21466 20343
10/31/98 21015 26190 22734
10/31/99 25848 32911 27055

- --------------------------------------------------------------------------------
Average Annual Total Return At Maximum Applicable
Sales Charge For The Periods Ending October 31, 1999

1 Year 5 Years 10 Years (or Life)
- --------------------------------------------------------------------------------
Class A(3) 16.70% - 20.62%
Class B(4) 18.17% - 16.11%
Class C(5) 22.00% 20.29% 17.70%
- --------------------------------------------------------------------------------

(1) This shows total return applicable to Class C shares, with all dividends
and distributions reinvested for the periods shown ending October 31, 1999,
using the SEC-required uniform method to compute such return.
(2) Performance for the unmanaged S&P 500(R) Index and S&P Barra Value Index do
not reflect any fees or expenses. The performance of the indices is not
necessarily representative of the Fund's performance. Performance for each
index begins on 12/31/93.
(3) The Class A shares were first offered on 7/15/96. This shows total return
which is the percent change in values, after deduction of the maximum
initial sales charge of 5.75% applicable to Class A shares, with all
dividends and distributions reinvested for the periods shown ending October
31, 1999, using the SEC required uniform method to compute such returns.
(4) The Class B shares were first offered on 6/5/97. Performance reflects
the deduction of a CDSC of 5% (for 1 year) and 3% (life of class).
(5) The Class C shares were first offered on 1/3/94. Performance reflects the
deduction of a CDSCof 1% (for 1 year) and 0% (for 5 years and life of
Class).

Financial Information 31

<PAGE>

International Series

FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Class A Shares Class B Shares
-------------------------------------- ---------------------------------------------
Year Ended October 31, Year Ended October 31,
Per Share Operating Performance: 1999 1998 1997(a) 1999 1998 1997(a)

<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $12.39 $10.86 $9.42 $12.28 $10.83 $10.26
Income from investment operations
Net investment income (loss) .07(d) .11(d) (.07) (.02)(d) .02(d) (.03)
Net realized and unrealized gain on
investments and foreign currency 1.55 1.45 1.37 1.53 1.43 .60
holdings
Total from investment operations 1.62 1.56 1.44 1.51 1.45 .57
- -----------------------------------------------------------------------------------------------------------------------------------
Distributions
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends from net investment income (.09) (.03) -- (.02) -- --
Dividends from net realized gain (.02) -- -- (.02) -- --
Net asset value, end of period $13.90 $12.39 $10.86 $13.75 $12.28 $10.83
Total Return(b) 13.16% 14.36% 15.21%(c) 12.31% 13.39% 5.56%(c)
Ratios to Average Net Assets:
Expenses 1.51%(e) 1.31% 1.23%(c) 2.19%(e) 2.03% .87%(c)
Net investment income (loss) .52% .80% (.41)%(c) (.16)% .18% (.46)%(c)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Class C Shares Class P Shares
------------------------------------------- -------------------------------------
Year Ended October 31, Year Ended October 31,
Per Share Operating Performance: 1999 1998 1997(a) 1999(a)

<S> <C> <C> <C> <C>
Net asset value, beginning of period $12.28 $10.83 $10.26 $12.70
- -----------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income (loss) (.02)(d) .02(d) (.03) .08
- -----------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain on
investments and foreign currency holdings 1.53 1.43 .60 1.13
Total from investment operations 1.51 1.45 .57 1.21
Distributions
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends from net investment income (.02) -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends from net realized gain (.02) -- -- --
Net asset value, end of period $13.75 $12.28 $10.83 $13.91
- -----------------------------------------------------------------------------------------------------------------------------------
Total Return(b) 12.31% 13.39% 5.56%(c) 9.53%
Ratios to Average Net Assets:
Expenses 2.19%(e) 2.05% .87%(c) .98%(c)(e)
Net investment income (loss) (.15)% 0.12% (.46)%(c) .60%(c)
- -----------------------------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31,
----------------------------------------------------------------------
Supplemental Data For All Classes: 1999 1998 1997(a)
Net assets, end of period (000) $213,087 $153,033 $37,334
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 75.15% 20.52% 29.72%
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(a) From commencement of operations for each Class of shares: December 13,1996
(Class A), June 2, 1997 (Class B), June 2, 1997 (Class C), and March 9,
1999 (Class P).

(b) Total return does not consider the effects of sales loads and assumes the
reinvestment of all distributions.

(d) Calculated using average shares outstanding during the period.

(e) The ratio includes expenses paid through an expense offset arrangement.

32 Financial Information

<PAGE>

International Series

LINE GRAPH COMPARISON

Immediately below is a comparison of a $10,000 investment in Class A shares
to the same investment in the MSCI EAFE Index, assuming reinvestment of all
dividends and distributions.

- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]

NAV MAX MSCI EAFE
12/13/96 10000 9426 10000
10/31/97 11521 10860 10217
10/31/98 13175 12419 13859
10/31/99 14909 14053 13859

- --------------------------------------------------------------------------------
Average Annual Total Return At Maximum Applicable
Sales Charge For The Periods Ending October 31, 1999

1 Year 10 Years (or Life)
- --------------------------------------------------------------------------------
Class A(3) 6.60% 12.54%
- --------------------------------------------------------------------------------
Class B(4) 7.31% 11.99%
- --------------------------------------------------------------------------------
Class C(5) 11.31% 13.04%
- --------------------------------------------------------------------------------
Class P(6) 9.53% -
- --------------------------------------------------------------------------------

(1) Reflects the deduction of the maximum initial sales charge of 5.75%.
(2) Performance for the unmanaged MSCI EAFE Index does not reflect any fees or
expenses. The performance of the index is not necessarily representative of
the Fund's performance. Performance for this index begins on 12/31/96.
(3) This shows total return which is the percent change in value, after
deduction of the maximum initial sales charge of 5.75% applicable to Class
A shares, with all dividends and distributions reinvested for the periods
shown ending October 31, 1999, using the SEC-required uniform method to
compute such return.
(4) The Class B shares were first offered on 6/2/97. Performance reflects the
deduction of a CDSC of 5% (for 1 year) and 3% (life of Class).
(5) The Class C shares were first offered on 6/2/97. Performance reflects the
deduction of a CDSC of 1% (for 1 year) and 0% (life of Class).
(6) The Class P shares were first offered on 3/8/99. Performance is at net
asset value.

Financial Information 33

<PAGE>

World Bond-Debenture Series

FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Class A Shares Class B Shares Class C Shares
- -----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31,
Per Share Operating Performance: 1999 1998(a) 1999 1998(a) 1999 1998(a)

<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $9.66 $10.00 $9.65 $10.00 $9.65 $10.00
- -----------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income .83(d) .511 .76(d) .406 .78(d) .395
Net realized and unrealized loss on
investments and foreign currency holdings (.22) (.425) (.21) (.372) (.25) (.361)
Total from investment operations .61 .086 .55 .034 .53 .034
Distributions
Dividends from net investment income (.85) (.426) (.78) (.384) (.78) (.384)
Dividends from net realized gain (.18) -- (.18) -- (.18) --
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $9.24 $9.66 $9.24 $9.65 $9.22 $9.65
- -----------------------------------------------------------------------------------------------------------------------------------
Total Return(b) 6.33% 0.75%(c) 5.73% 0.24%(c) 5.50% 0.24%(c)
Ratios to Average Net Assets:
Expenses, including waiver .89% 0.55%(c) 1.56% 1.28%(c) 1.56% 1.28%(c)
Expenses, excluding waiver 1.84% 1.20%(c) 2.51% 1.93%(c) 2.51% 1.93%(c)
Net investment income 8.64% 7.08%(c) 7.91% 6.67%(c) 8.16% 6.62%(c)
- -----------------------------------------------------------------------------------------------------------------------------------

Year Ended October 31,
- -----------------------------------------------------------------------------------------------------------------------------------
Supplemental Data For All Classes: 1999 1998(a)
Net assets, end of period (000) $11,712 $10,134
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 74.80% 159.14%
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(a) From commencement of operations for each Class of shares: December 18, 1997
(Class A), December 19, 1997 (Class B), and December 19, 1997 (Class C).
(b) Total return does not consider the effects of sales loads and assumes the
reinvestment of all distributions.
(c) Not annualized.
(d) Calculated using average shares outstanding during the year.

34 Financial Information

<PAGE>

World Bond-Debenture Series

LINE GRAPH COMPARISON

Immediately below is a comparison of a $10,000 investment in Class A shares
to the same investment in JP Morgan Emerging Market Index, and JP Morgan
Global Government Bond Index and the Merrill Lynch High Yield Master Index,
assuming reinvestment of all dividends and distributions.
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
JP Morgan Merrill JP Morgan
NAV MAX Emerging Lynch Global
12/18/97 10000 9524 10000 10000 10000
10/31/98 10075 9596 8296 9805 11448
10/31/99 10713 10202 9954 10355 11109

- --------------------------------------------------------------------------------
Average Annual Total Return At Maximum Applicable
Sales Charge For The Periods Ending October 31, 1999

1 Year 10 Years (or Life)
- --------------------------------------------------------------------------------
Class A(3) 1.30% 1.06%
- --------------------------------------------------------------------------------
Class B(4) .94% 1.22%
- --------------------------------------------------------------------------------
Class C(5) 4.55% 3.04%
- --------------------------------------------------------------------------------

(1) Reflects the deduction of the maximum initial sales charge of 4.75%.
(2) Performance for the unmanaged JP Morgan Emerging Market Index, the JP
Morgan Global Goverment Bond Index, and the Merrill Lynch High Yield Master
Index do not reflect any fees or expenses. These three indices chosen to
compare to the Fund's performance have elements of three categories:
high-yield corporate debt, equity-related securities and high-grade debt.
Since there is no one index combining all three in the same annual blend as
the Fund's portfolio, these three separate indices may not be a valid
comparison for the Fund. Performance for the three indices begins on
12/31/97.
(3) This shows total return which is the percent change in value, after
deduction of the maximum initial sales charge of 4.75% applicable to Class
A shares, with all dividends and distributions reinvested for the periods
shown ending October 31, 1999, using the SEC-required uniform method to
compute such return.
(4) The Class B shares were first offered on 12/18/97. Performance reflects
the deduction of a CDSC of 5% (for 1 year) and 3% (life of Class).
(5) The Class C shares were first offered on 12/18/97. Performance reflects the
deduction of a CDSC of 1% (for 1 year) and 0% (life of Class).

Financial Information 35

<PAGE>

Alpha Series

FINANCIAL HIGHLIGHTS

- -----------------------------------------------------------------------------------------------------------------------------------
Class A Shares Class B Shares Class C Shares
-------------------------------------------------------------------------------------------
Year Ended October 31,
Per Share Operating Performance: 1999 1998(b) 1999 1998(b) 1999 1998(b)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $12.91 $13.52 $12.85 $13.52 $12.86 $13.52
Income (loss) from investment operations
Net investment income(d) .07 (.03) (.03) (.11) (.04) (.11)
Net realized and unrealized loss on
investments 2.23 (.58) 2.23 (.56) 2.22 (.55)
Total from investment operations 2.30 (.61) 2.20 (.67) 2.18 (.66)
Net asset value, end of year $15.21 $12.91 $15.05 $12.85 $15.04 $12.86
Total Return(a) 17.82% (4.51)%(c) 17.12% (4.96)%(c) 16.95% (4.88)%(c)
Ratios to Average Net Assets:
Expenses, including waiver .33% .21%(c) 1.00% .83%(c) 1.00% (.82)%(c)
Expenses, excluding waiver .83% .63%(c) 1.50% 1.26%(c) 1.50% 1.24%(c)
Net investment income .15% .18%(c) (.83)% (.81)%(c) (.84)% (.82)%(c)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

- --------------------------------------------------------------------------------
Year Ended October 31,
- --------------------------------------------------------------------------------
Supplemental Data For All Classes: 1999 1998(a)
Net assets, end of period (000) $162,120 $106,279
- --------------------------------------------------------------------------------
Portfolio turnover rate 1.67% 0.01%
- --------------------------------------------------------------------------------

(a) Total return does not consider the effects of sales load and assumes the
reinvestment of all distributions.

(b) From commencement of operations for each class of shares: December 29,
1997.

(d) Calculated using average shares outstanding during the period.

36 Financial Information

<PAGE>

Alpha Series

LINE GRAPH COMPARISON

Immediately below is a comparison of a $10,000 investment in Class A shares
to the same investment in Salomon Brothers Extended Market Index, assuming
reinvestment of all dividends and distributions.

- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
Salomon
NAV MAX Brothers
12/29/97 10000 9428 10000
10/31/98 9549 9003 9697
10/31/99 11250 10607 11367

- --------------------------------------------------------------------------------
Average Annual Total Return At Maximum Applicable
Sales Charge For The Periods Ending October 31, 1999

1 Year 10 Years (or Life)
- --------------------------------------------------------------------------------
Class A(3) 11.00% 3.27%
- --------------------------------------------------------------------------------
Class B(4) 12.12% 3.91%
- --------------------------------------------------------------------------------
Class C(5) 15.96% 5.96%

(1) Reflects the deduction of the maximum initial sales charge of 5.75%.

(2) Performance for the unmanaged Salomon Brothers Extended Market Index does
not reflect any fees or expenses. The performance of the index is not
necessarily representative of the Fund's performance. Performance for this
index begins on 12/31/97.

(3) This shows total return which is the percent change in value, after
deduction of the maximum initial sales charge of 5.75% applicable to Class
A shares, with all dividends and distributions reinvested for the periods
shown ending October 31, 1999, using the SEC-required uniform method to
compute such return.

(4) The Class B shares were first offered on 12/29/97. Performance reflects the
deduction of a CDSC of 5% (for 1 year) and 3% (life of Class).

(5) The Class C shares were first offered on 12/29/97. Performance reflects the
deduction of a CDSC of 1% (for 1 year) and 0% (life of Class).

Financial Information 37
<PAGE>

Compensation for your dealer -
Growth & Income Series, International Series and Alpha Series

- ------------------------------------------------------------------------------------------------------------------------------
First Year Compensation

Front-end
sales charge Dealer's
paid by investors concession Service fee(1) Total compensation(2)
Class A investments (% of offering price) (% of offering price) (% of net investment) (% of offering price)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Less than $50,000 5.75% 5.00% 0.25% 5.24%
- ------------------------------------------------------------------------------------------------------------------------------
$50,000 - $99,999 4.75% 4.00% 0.25% 4.24%
- ------------------------------------------------------------------------------------------------------------------------------
$100,000 - $249,999 3.95% 3.25% 0.25% 3.49%
- ------------------------------------------------------------------------------------------------------------------------------
$250,000 - $499,999 2.75% 2.25% 0.25% 2.49%
- ------------------------------------------------------------------------------------------------------------------------------
$500,000 - $999,999 1.95% 1.75% 0.25% 2.00%
- ------------------------------------------------------------------------------------------------------------------------------
$1 million or more(3) or Retirement Plan - 100 or more eligible employees(3) or
Special Retirement Wrap Program(3)
- ------------------------------------------------------------------------------------------------------------------------------
First $5 million no front-end sales charge 1.00% 0.25% 1.25%
- ------------------------------------------------------------------------------------------------------------------------------
Next $5 million above that no front-end sales charge 0.55% 0.25% 0.80%
- ------------------------------------------------------------------------------------------------------------------------------
Next $40 million above that no front-end sales charge 0.50% 0.25% 0.75%
- ------------------------------------------------------------------------------------------------------------------------------
Over $50 million no front-end sales charge 0.25% 0.25% 0.50%
- ------------------------------------------------------------------------------------------------------------------------------
Class B investments(4) Paid at time of sale (% of net asset value)
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 3.75% 0.25% 4.00%
- ------------------------------------------------------------------------------------------------------------------------------
Class C investments(4)
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.75% 0.25% 1.00%
- ------------------------------------------------------------------------------------------------------------------------------
Class P investments Percentage of average net assets
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.25% 0.20% 0.45%
- ------------------------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------------------
Annual Compensation After first Year

Class A investments Percentage of average net assets(5)
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge none 0.25% 0.25%
Class B investments(4)
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge none 0.25% 0.25%
Class C investments(4)
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.75% 0.25% 1.00%
Class P investments
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.25% 0.20% 0.45%
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1 The service fees for Class A and P shares are paid quarterly. The first
year's service fees on Class B and C shares are paid at the time of sale.

(2) Reallowance/concession percentages and service fee percentages are
calculated from different amounts, and therefore may not equal total
compensation percentages if combined using simple addition. Additional
Concessions may be paid to Authorized Institutions, such as your dealer,
from time to time.

(3) Concessions are paid at the time of sale on all Class A shares sold during
any 12-month period starting from the day of the first net asset value
sale. With respect to (a) Class A share purchases at $1 million or more,
sales qualifying at such level under rights of accumulation and statement
of intention privileges are included and (b) for Special Retirement Wrap
Programs, only new sales are eligible and exchanges into the Fund are
excluded.

(4) Class B and C shares are subject to CDSCs.

(5) With respect to Class B, C and P shares, 0.25%, 1.00% and 0.45%,
respectively, of the average annual net asset value of such shares
outstanding during the quarter (including distribution reinvestment shares
after the first anniversary of their issuance) is paid to Authorized
Institutions, such as your dealer. These fees are paid quarterly in
arrears.

38 Financial Information

<PAGE>

Compensation for your dealer - World Bond-Debenture Series
<TABLE>
<CAPTION>

- ------------------------------------------------------------------------------------------------------------------------------
First Year Compensation

Less than $100,000 4.75% 4.00% 0.25% 4.24%
- ------------------------------------------------------------------------------------------------------------------------------
$100,000 - $249,999 3.95% 3.25% 0.25% 3.49%
- ------------------------------------------------------------------------------------------------------------------------------
$250,000 - $499,999 2.75% 2.25% 0.25% 2.74%
- ------------------------------------------------------------------------------------------------------------------------------
$500,000 - $999,999 1.95% 1.75% 0.25% 2.00%
- ------------------------------------------------------------------------------------------------------------------------------

$1 million or more(3) or Retirement Plan - 100 or more eligible employees(3) or
Special Retirement Wrap Program(3)
First $5 million no front-end sales charge 1.00% 0.25% 1.25%
- ------------------------------------------------------------------------------------------------------------------------------
Next $5 million above that no front-end sales charge 0.55% 0.25% 0.80%
- ------------------------------------------------------------------------------------------------------------------------------
Next $40 million above that no front-end sales charge 0.50% 0.25% 0.75%
- ------------------------------------------------------------------------------------------------------------------------------
Over $50 million no front-end sales charge 0.25% 0.25% 0.50%
- ------------------------------------------------------------------------------------------------------------------------------
Class B investments Paid at time of sale (% of net asset value)
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 3.75% 0.25% 4.00%
- ------------------------------------------------------------------------------------------------------------------------------
Class C investments
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.75% 0.25% 1.00%
- ------------------------------------------------------------------------------------------------------------------------------
Class P investments Percentage of average net assets
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.25% 0.20% 0.45%
- ------------------------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------------------
Annual Compensation After first Year

Class A investments Percentage of average net assets(5)
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge none 0.25% 0.25%
- ------------------------------------------------------------------------------------------------------------------------------
Class B investments
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge none 0.25% 0.25%
- ------------------------------------------------------------------------------------------------------------------------------
Class C investments
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.65% 0.25% 0.90%
- ------------------------------------------------------------------------------------------------------------------------------
Class P investments
- ------------------------------------------------------------------------------------------------------------------------------
All amounts no front-end sales charge 0.25% 0.20% 0.45%
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The service fees for Class A and P shares are paid quarterly. The first
year's service fees on Class B and C shares are paid at the time of sale.

(4) Class B and C shares are subject to CDSCs.

(5) With respect to Class B, C and P shares, 0.25%, 0.90% and 0.45%,
respectively, of the average annual net asset value of such shares
outstanding during the quarter (including distribution reinvestment shares
after the first anniversary of their issuance) is paid to Authorized
Institutions, such as your dealer. These fees are paid quarterly in
arrears.

39 Financial Information

<PAGE>

THIS PAGE INTENTIONALLY LEFT BLANK

<PAGE>

More information on these Funds is available free upon request, including
the following:

ANNUAL/SEMI-ANNUAL REPORT

Describes the Funds, lists portfolio holdings and contains a letter from
each Fund's manager discussing recent market conditions and each Fund's
investment strategies.

STATEMENT OF ADDITIONAL INFORMATION ("SAI")

Provides more details about the Funds and their policies. A current SAI is
on file with the Securities and Exchange Commission ("SEC") and is
incorporated by reference (is legally considered part of this prospectus).

Lord Abbett Growth & Income Series
Lord Abbett International Series
Lord Abbett World Bond-Debenture Series
Lord Abbett Alpha Series

90 Hudson Street
Jersey City, NJ 07302-3973
--------------------------
SEC file number: 811-7358

To obtain information:

By telephone. Call the Funds at:
800-426-1130

By mail. Write to the Funds at:
The Lord Abbett Family of Funds
90 Hudson Street
Jersey City, NJ 07302-3973

Via the Internet.
Lord, Abbett & Co.
www.lordabbett.com

Text only versions of Fund
documents can be viewed
online or downloaded from:
SEC
www.sec.gov

You can also obtain copies by visiting the SEC's Public Reference Room in
Washington, DC (phone 202-942-8090) or by sending your request and a duplicating
fee to the SEC's Public Reference Section, Washington, DC 20549-6009 or by
sending your request electronically to [email protected].

lST-1-300
(3/00)

<PAGE>

LORD ABBETT

Statement of Additional Information March 1, 2000

Alpha Series
Growth & Income Series
International Series
World Bond-Debenture Series

This Statement of Additional Information is not a Prospectus. A Prospectus may
be obtained from your securities dealer or from Lord Abbett Distributor LLC
("Lord Abbett Distributor") at 90 Hudson St., Jersey City, NJ 07302-3973. This
Statement of Additional Information relates to, and should be read in
conjunction with, the prospectus dated March 1, 2000 (the "Prospectus").

Shareholder inquiries should be made by contacting the Funds directly or by
calling 800-821-5129. The Annual Report to Shareholders is available, without
charge, upon request by calling that number. In addition, you can make inquiries
through your dealer.

TABLE OF CONTENTS Page

1. Investment Objective and Policies 2
2. Trustees and Officers 8
3. Investment Advisory and Other Services 11
4. Portfolio Transactions 13
5. Purchases, Redemptions and Shareholder Services 14
6. Performance 22
7. Taxes 23
8. Information About the Company 25
9. Financial Statements 26

1
<PAGE>

1.
Investment Policies

Lord Abbett Securities Trust (the "Company" or the "Funds") is a diversified
open-end management investment company registered under the Investment Company
Act of 1940, as amended (the "Act"). The Fund was organized as a Delaware
business trust. Four of the Company's portfolios, (individually "we" or the
"Fund", collectively the "Funds") are described in this Statement of Additional
Information.

Fundamental Investment Restrictions. Each Fund is subject to the following
fundamental investment restrictions, which cannot be changed without approval of
a majority of each Fund's outstanding shares.

Each Fund may not:

(1) borrow money, except that (i) it may borrow from banks as defined in
the Act in amounts up to 33 1/3% of its total assets (including the
amount borrowed), (ii) it may borrow up to an additional 5% of its
total assets for temporary purposes, (iii) it may obtain such
short-term credit as may be necessary for the clearance of purchases
and sales of portfolio securities, and (iv) it may purchase securities
on margin to the extent permitted by applicable law;

(2) pledge its assets (other than to secure borrowings, or to the extent
permitted by each Fund's investment policies as permitted by
applicable law);

(3) engage in the underwriting of securities, except pursuant to a merger
or acquisition or to the extent that, in connection with the
disposition of its portfolio securities, it may be deemed to be an
underwriter under federal securities laws;

(4) make loans to other persons, except that the acquisition of bonds,
debentures or other corporate debt securities and investment in
government obligations, commercial paper, pass-through instruments,
certificates of deposit, bankers acceptances, repurchase agreements or
any similar instruments shall not be subject to this limitation, and
except further that each Fund may lend its portfolio securities,
provided that the lending of portfolio securities may be made only in
accordance with applicable law;

(5) buy or sell real estate (except that each Fund may invest in
securities directly or indirectly secured by real estate or interests
therein or issued by companies which invest in real estate or
interests therein), or commodities or commodity contracts (except to
the extent each Fund may do so in accordance with applicable law and
without registering as a commodity pool operator under the Commodity
Exchange Act as, for example, with futures contracts);

(6) with respect to 75% of its gross assets, buy securities of one issuer
representing more than (i) 5% of its gross assets, except securities
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities or (ii) 10% of the voting securities of such issuer;

(7) invest more than 25% of its assets, taken at market value, in the
securities of issuers in any particular industry (excluding securities
of the U.S. Government, its agencies and instrumentalities); or

(8) issue senior securities to the extent such issuance would violate
applicable law.

Compliance with the investment restrictions in this Section 1 will be determined
at the time of the purchase or sale of the portfolio investments.

2
<PAGE>

Non-Fundamental Investment Restrictions. In addition to the policies in the
Prospectus and the investment restrictions above which cannot be changed without
shareholder approval, each Fund is also subject to the following non-fundamental
investment policies which may be changed by the Board of Trustees without
shareholder approval.

Each Fund may not:

(1) borrow in excess of 33 1/3% of its total assets (including the amount
borrowed), and then only as a temporary measure for extraordinary or
emergency purposes;

(2) make short sales of securities or maintain a short position except to
the extent permitted by applicable law;

(3) invest knowingly more than 15% of its net assets (at the time of
investment) in illiquid securities, except for securities qualifying
for resale under Rule 144A of the Securities Act of 1933, deemed to be
liquid by the Board of Trustees;

(4) invest in the securities of other investment companies to the extent
permitted by applicable law (in the case of the International Series,
as long as the Fund is an underlying fund in a fund-of-funds
structure);

(5) invest in securities of issuers which, with their predecessors, have a
record of less than three years' continuous operations, if more than
5% of its total assets would be invested in such securities. (This
restriction shall not apply to mortgaged-backed securities,
asset-backed securities or obligations issued or guaranteed by the U.
S. Government, its agencies or instrumentalities.);

(6) hold securities of any issuer if more than 1/2 of 1% of the securities
of such issuer are owned beneficially by one or more of its officers
or trustees or by one or more of its partners or members or
underwriter or investment adviser if these owners in the aggregate own
beneficially more than 5% of the securities of such issuer;

(7) invest in warrants if, at the time of the acquisition, its investment
in warrants, valued at the lower of cost or market, would exceed 5% of
its total assets (included within such limitation, but not to exceed
2% of its total assets, are warrants which are not listed on the New
York or American Stock Exchange or a major foreign exchange);

(8) invest in real estate limited partnership interests or interests in
oil, gas or other mineral leases, or exploration or other development
programs, except that it may invest in securities issued by companies
that engage in oil, gas or other mineral exploration or other
development activities;

(9) write, purchase or sell puts, calls, straddles, spreads or
combinations thereof, except to the extent permitted in its Prospectus
and Statement of Additional Information, as they may be amended from
time to time; or

(10) buy from or sell to any of its officers, trustees, employees, or its
investment adviser or any of its officers, trustees, partners or
employees, any securities other than its shares.

Portfolio Turnover. For the fiscal year ended October 31, 1999, the portfolio
turnover rate was 1.67% for the Alpha Series; 37.68% for the Growth & Income
Series; 75.15% for the International Series; and 74.80% for the World
Bond-Debenture Series.

INVESTMENT TECHNIQUES

Each Fund intends to utilize, from time to time, one or more of the investment
techniques described below, including lending portfolio securities, repurchase
agreements, warrants, and covered call options. While some of these techniques
involve risk when utilized independently, each Fund intends to use them to
reduce risk and volatility in its portfolios. In the case of the Alpha Series
references to each Fund refers to the underlying funds.

3
<PAGE>

Closed-end Investment Companies. Each Fund may invest in shares of closed-end
investment companies if bought in the primary or secondary market with a fee or
commission no greater than the customary broker's commission.

Covered Call Options. Each Fund may write covered call options which are traded
on a national securities exchange with respect to securities in its portfolio in
an attempt to increase its income and to provide greater flexibility in the
disposition of its portfolio securities. A "call option" is a contract sold for
a price (the "premium") giving its holder the right to buy a specific number of
shares of stock at a specific price prior to a specified date. A "covered call
option" is a call option issued on securities already owned by the writer of the
call option for delivery to the holder upon the exercise of the option. During
the period of the option, each Fund forgoes the opportunity to profit from any
increase in the market price of the underlying security above the exercise price
of the option (to the extent that the increase exceeds its net premium). Each
Fund may enter into "closing purchase transactions" in order to terminate its
obligation to deliver the underlying security (this may result in a short-term
gain or loss). A closing purchase transaction is the purchase of a call option
(at a cost which may be more or less than the premium received for writing the
original call option) on the same security, with the same exercise price and
call period as the option previously written. If a Fund is unable to enter into
a closing purchase transaction, it may be required to hold a security that it
might otherwise have sold to protect against depreciation. Each Fund does not
intends to write covered call options with respect to securities with an
aggregate market value of more than 5% of its gross assets at the time an option
is written. This percentage limitation will not be increased without prior
disclosure in the current Prospectus.

Each Fund's custodian will segregate cash or liquid high-grade debt securities
in an amount not less than that required by the Securities and Exchange
Commission ("SEC") Release 10666 with respect to Fund assets committed to
written covered call options. If the value of the segregated securities
declines, additional cash or debt securities will be added on a daily basis
(i.e., marked-to-market) so that the segregated amount will not be less than the
amount of each Fund's commitments with respect to such written options.

Lending Portfolio Securities. Each Fund may lend portfolio securities to
registered broker-dealers. These loans, if and when made, may not exceed 30% of
each Fund's total assets. Each Fund loan of securities will be collateralized by
cash or marketable securities issued or guaranteed by the U.S. Government or its
agencies ("U.S. Government securities") or other permissible means at least
equal to the market value of the loaned securities. From time to time, each Fund
may pay a part of the interest received with respect to the investment of
collateral to a borrower and/or a third party that is not affiliated with the
Fund and is acting as a "placing broker." No fee will be paid to affiliated
persons.

By lending portfolio securities, each Fund can increase its income by continuing
to receive interest on the loaned securities as well as by either investing the
cash collateral in permissible investments, such as U.S. Government securities
or obtaining yield in the form of interest paid by the borrower when U.S.
Government securities or other forms of non-cash collateral are received. Each
Fund will comply with the following conditions whenever it loans securities: (i)
it must receive at least 100% collateral from the borrower; (ii) the borrower
must increase the collateral whenever the market value of the securities loaned
rises above the level of the collateral; (iii) it must be able to terminate the
loan at any time; (iv) it must receive reasonable compensation for the loan, as
well as any dividends, interest or other distributions on the loaned securities;
(v) it may pay only reasonable fees in connection with the loan and (vi) voting
rights on the loaned securities may pass to the borrower except that, if a
material event adversely affecting the investment in the loaned securities
occurs, the Trustees must terminate the loan and regain the right to vote the
securities.

Repurchase Agreements. Each Fund may enter into repurchase agreements with
respect to a security. A repurchase agreement is a transaction by which each
Fund acquires a security and simultaneously commits to resell that security to
the seller (a bank or securities dealer) at an agreed upon price on an agreed
upon date. The resale price reflects the purchase price plus an agreed upon
market rate of interest which is unrelated to the coupon rate or date of
maturity of the purchased security. In this type of transaction, the securities
purchased by each Fund have a total value in excess of the value of the
repurchase agreement. Each Fund requires at all times that the repurchase
agreement be collateralized by cash or U.S. Government securities having a value
equal to, or in excess of, the value of the repurchase agreement. Such
agreements permit each Fund to keep all of its assets at work while retaining
flexibility in pursuit of investments of a longer term nature.

4
<PAGE>

may incur a loss upon disposition of them. If the seller of the agreement
becomes insolvent and subject to liquidation or reorganization under the
Bankruptcy Code or other laws, a bankruptcy court may determine that the
underlying securities are collateral not within the control of the Fund and are
therefore subject to sale by the trustee in bankruptcy. Even though the
repurchase agreements may have maturities of seven days or less, they may lack
liquidity, especially if the issuer encounters financial difficulties. While
Fund management acknowledges these risks, it is expected that they can be
controlled through stringent selection criteria and careful monitoring
procedures. Fund management intends to limit repurchase agreements to
transactions with dealers and financial institutions believed by Fund management
to present minimal credit risks. Fund management will monitor creditworthiness
of the repurchase agreement sellers on an ongoing basis.

Rights And Warrants. Each Fund may invest in rights and warrants to purchase
securities, including warrants which are not listed on the NYSE or American
Stock Exchange in an amount not to exceed 5% of the value of the Fund's gross
assets. Each Fund except World Bond-Debenture Series, will not invest more than
5% of its assets in warrants and not more than 2% of such value in warrants not
listed on the New York or American Stock Exchanges, except when they form a unit
with other securities. As a matter of operating policy, the Fund will not invest
more than 5% of its net assets in rights.

Rights represent a privilege offered to holders of record of issued securities
to subscribe (usually on a pro rata basis) for additional securities of the same
class, of a different class or of a different issuer, as the case may be.
Warrants represent the privilege to purchase securities at a stipulated price
and are usually valid for several years. Rights and warrants generally do not
entitle a holder to dividends or voting rights with respect to the underlying
securities nor do they represent any rights in the assets of the issuing
company.

Also, the value of a right or warrant may not necessarily change with the value
of the underlying securities and rights and warrants cease to have value if they
are not exercised prior to their expiration date.

Stock Index Futures Contracts. The Developing Growth Fund believes it can reduce
the volatility inherent in its portfolio through the use of stock index futures
contracts. (A stock index futures contract is an agreement pursuant to which two
parties agree, one to receive and the other to pay, on a specified date an
amount of cash equal to a specified dollar amount -- established by an exchange
or board of trade -- times the difference between the value of the index at the
close of the last trading day of the contract and the price at which the futures
contract is originally written. No consideration is paid or received at the time
the contract is entered into, only the good faith deposit described herein.)
When Lord Abbett, our investment manager, anticipates a general decline in the
sector of the stock market which includes our portfolio assets, we can reduce
risk by hedging the effect of such decline on our ability to sell assets at best
price or otherwise hedge a decision to delay the sale of portfolio securities.
Such hedging would be possible if there were an established, regularly-quoted
stock index for equities of the character in which we invest and if an active
public market were to develop on a stock exchange or board of trade in futures
contracts based on such index.

The market value of a futures contract is based primarily on the value of the
underlying index. Changes in the value of the index will cause roughly
corresponding changes in the market price of the futures contract, except as
otherwise described below. If a stock index is established which is made up of
securities whose market characteristics closely parallel the market
characteristics of the securities in our portfolio, then the market value of a
futures contract on that index should fluctuate in a way closely resembling the
market fluctuation of our portfolio. Thus, if we should sell futures contracts,
a decline in the market value of the portfolio will be offset by an increase in
the value of the short futures position to the extent of the hedge (i.e., the
percentage of the portfolio value represented by the value of the futures
position). Conversely, when we are in a strong cash position (for example,
through substantial sales of our shares) and wish to invest the cash in
anticipation of a rising market, we could rapidly hedge against the expected
market increase by buying futures contracts to offset the cash position and thus
cushion the adverse effect of attempting to buy individual securities in a
rising market.

The public markets for existing stock index futures contracts, such as those
using the Standard & Poor's 100 Index and 500 Index traded on the Chicago
Mercantile Exchange or those using the New York Stock Exchange Composite Index
traded on the New York Stock Exchange ("NYSE"), are active and have developed

5
<PAGE>

substantial liquidity and we expect a similar market to develop for stock index
futures on a representative group of over-the-counter stocks. The existence of
an active market would permit us to close out our position in futures contracts
by purchasing an equal and opposite position in the public market. Under futures
contracts currently in use, the purchaser would be required to segregate in a
separate account, as a good faith deposit, cash or Treasury bills in an amount
set by a board of trade or exchange (currently approximately 5% of the contract
value). Each day during the contract period we would either pay or receive an
amount of cash equal to the daily change in the total value of the contracts.
The amount which we may segregate upon entering into a futures contract may not
exceed, together with the amounts on deposit under all outstanding contracts, 5%
of the value of our total assets, nor may we enter into additional futures
contracts if, as a result, the aggregate amount committed under all our open
futures contracts would exceed more than one-third of the value of such assets.

There are several risks in connection with the use of futures contracts as a
hedging device. One risk is the imperfect correlation between the composition of
our portfolio securities and the applicable stock index. If the value of the
futures contract moves more than the value of the stock being hedged, we would
experience either a loss or a gain on the futures contract which would not be
completely offset by movements in the value of the securities which are the
subject of the hedge. Another risk is that the value of futures contracts may
not correlate perfectly with movement in the stock index due to certain market
distortions. Although we will enter into futures contracts strictly to hedge our
portfolio or cash positions, other investors use these investment vehicles for
other, sometimes more speculative, purposes. At times, excess speculation in the
futures market can distort the normal market relationship between the price of
the futures contract and the value of the index. If we decide to enter into or
close out our futures position during a period of such excess speculation, the
hedging strategy will be more or less successful, depending on the direction and
amount of this distortion, than otherwise would be the case. Due to the
possibility of price distortion in the futures market and because of the
imperfect correlation between movements in the stock index and movements in the
price of stock index futures contracts, a correct forecast of general market
trends by Lord Abbett may still not result in a successful hedging transaction.

It is possible that, when we sell futures contracts to hedge our portfolio
against a decline in the market, the market, as measured by the stock index, may
advance while the value of securities held in our portfolio may decline. If this
occurs, we will lose money on the futures contracts and also experience a
decline in value in our portfolio securities. However, Lord Abbett believes that
over time the value of a diversified portfolio will tend to move in the same
direction as the market index upon which the futures contracts are based.

Where futures contracts are purchased to hedge against a possible increase in
the price of stock before we are able to invest our cash position in stock in an
orderly fashion, it is possible that the market may decline instead and we would
realize a loss; if we then decide not to invest in stock at that time because of
concern as to possible further market decline or for other reasons, we would
realize a loss on the futures contract that would be offset, to the extent the
cash position had not been invested in stocks being hedged.

Positions in futures contracts may be closed out only on an exchange or board of
trade which provides a market for such contracts. Although we intend to purchase
or sell futures contracts only if an active market has developed and is
continuing, there is no assurance that a liquid market on an exchange or board
of trade will exist for any particular contract or at any particular time. In
such event, it may not be possible to close out a futures position, and in the
event of adverse price movements, we would continue to be required to make daily
cash payments marking our position to market. However, since futures contracts
would have been used to hedge portfolio securities and such securities would not
be sold until the futures contracts had been terminated, an increase in the
price of the securities, if any, may partially or completely offset losses on
the futures contract.

We may incur additional brokerage commissions through entering into futures
contracts, although we also can save on commissions by hedging through such
contracts rather than through buying or selling individual securities in
anticipation of market moves. Successful use by us of futures contracts will
depend upon Lord Abbett's ability to predict movements in the direction of the
over-the-counter market generally, which requires different skills and
techniques than predicting changes in the prices of individual stocks.

To date, we have not entered into any futures contracts and have no present
intent to do so. An established, regularly-quoted stock index for equities of
the character in which we invest has not yet been established. If such an index
is established and we actually use futures contracts, we will disclose such use
in our Prospectus.

6
<PAGE>

When-Issued Transactions. Each Fund, except the Developing Growth Fund, may
purchase portfolio securities on a when-issued basis. When-issued transactions
involve a commitment by the Fund to purchase securities, with payment and
delivery ("settlement") to take place in the future, in order to secure what is
considered to be an advantageous price or yield at the time of entering into the
transaction. When a Fund enters into a when-issued purchase, it becomes
obligated to purchase securities and it assumes all the rights and risks
attendant to ownership of a security, although settlement occurs at a later
date. The value of fixed-income securities to be delivered in the future will
fluctuate as interest rates vary. At the time a Fund makes the commitment to
purchase a security on a when-issued basis, it will record the transaction and
reflect the liability for the purchase and the value of the security in
determining its net asset value. A Fund generally has the ability to close out a
purchase obligation on or before the settlement date, rather than take delivery
of the security. Under no circumstances will settlement for such securities take
place more than 120 days after the purchase date.

Other International Series Investment Policies (which can be changed without
shareholder approval).

Options And Financial Futures Transactions. The International Series may engage
in options and financial futures transactions in accordance with its investment
objective and policies. Although the Fund is not currently employing such
options and financial futures transactions, it may engage in such transactions
in the future if it appears advantageous to us to do so, in order to cushion the
effects of fluctuating interest rates and adverse market conditions. The use of
options and financial futures, and possible benefits and attendant risks, are
discussed below, along with information concerning certain other investment
policies and techniques.

Financial Futures Contracts. The International Series may enter into contracts
for the future delivery of a financial instrument, such as a security or the
cash value of a securities index. This investment technique is designed
primarily to hedge (i.e., protect) against anticipated future changes in
interest rates or market conditions which otherwise might adversely affect the
value of securities which we hold or intend to purchase. A "sale" of a futures
contract means the undertaking of a contractual obligation to deliver the
securities or the cash value of an index called for by the contract at a
specified price during a specified delivery period. A "purchase" of a futures
contract means the undertaking of a contractual obligation to acquire the
securities or cash value of an index at a specified price during a specified
delivery period. At the time of delivery pursuant to the contract, adjustments
are made to recognize differences in value arising from the delivery of
securities that differ from those specified in the contract. In some cases,
securities called for by a futures contract may not have been issued at the time
the contract was written. The International Series will not enter into any
futures contracts or options on futures contracts if the aggregate of the market
value of the securities covered by its outstanding futures contracts and
securities covered by futures contracts subject to the outstanding options
written by it would exceed 50% of its total assets.

Although some financial futures contracts by their terms call for the actual
delivery or acquisition of securities, in most cases, a party will close out the
contractual commitment before delivery without having to make or take delivery
of the security by purchasing (or selling, as the case may be) on a commodities
exchange an identical futures contract calling for delivery in the same month.
Such a transaction, if effected through a member of an exchange, cancels the
obligation to make or take delivery of the securities. All transactions in the
futures market are made, offset or fulfilled through a clearing house associated
with the exchange on which the contracts are traded. The International Series
will incur brokerage fees when it purchases or sells contracts and will be
required to maintain margin deposits. At the time it enters into a futures
contract, it is required to deposit with its custodian, on behalf of the broker,
a specified amount of cash or eligible securities called "initial margin." The
initial margin required for a futures contract is set by the exchange on which
the contract is traded. Subsequent payments, called "variation margin," to and
from the broker are made on a daily basis as the market price of the futures
contract fluctuates. The costs incurred in connection with futures transactions
could reduce the Fund's return. Futures contracts entail risks. If the
investment adviser's judgment about the general direction of interest rates or
markets is wrong, the overall performance may be poorer than if no such
contracts had been entered into.

There may be an imperfect correlation between movements in prices of futures
contracts and portfolio securities being hedged. The degree of difference in
price movements between futures contracts and the securities (or securities
indices) being hedged depends upon such things as variations in demand and
liquidity for futures contracts and the securities underlying the contracts. In
addition, the market prices of futures contracts may be affected by certain
factors not directly related to the underlying securities. At any given time,
the availability of futures contracts, and hence their prices, are influenced by
credit conditions and margin requirements. Due to the possibility of price
distortions in the futures market and because of the imperfect correlation
between movements in the prices of securities and movements in the prices of
futures contracts, a correct forecast of market trends by the investment adviser
may not result in a successful hedging transaction.

7
<PAGE>

Options on Financial Futures Contracts. The International Series may purchase
and write call and put options on financial futures contracts. An option on a
futures contract gives the purchaser the right, in return for the premium paid,
to assume a position in a futures contract at a specified exercise price at any
time during the period of the option. Upon exercise, the writer of the option
delivers the futures contract to the holder at the exercise price. The
International Series would be required to deposit with our custodian initial
margin and maintenance margin with respect to put and call options on futures
contracts written by us. Options on futures contracts involve risks similar to
the risks relating to transactions in financial futures contracts described
above. Generally speaking, a given dollar amount used to purchase an option on a
financial futures contract can hedge a much greater value of underlying
securities than if that amount were used to directly purchase the same financial
futures contract. Should the event that the International Series intends to
hedge (or protect) against not materialize, however, the option may expire
worthless, in which case it would lose the premium paid therefor.

2.
Trustees and Officers

The Company's Board of Trustees is responsible for the management of the
business and affairs of each Fund.

The following Trustee is a partner of Lord, Abbett & Co. ("Lord Abbett"), 90
Hudson Street, Jersey City, NJ 07302-3973. He has been associated with Lord
Abbett for over five years and is also an officer and/or director or trustee of
thirteen other Lord Abbett-sponsored funds.

*Robert S. Dow, age 54, Chairman and President

*Mr. Dow is an "interested person" as defined in the Act.

The following outside trustees are also directors or trustees of the other Lord
Abbett-sponsored funds referred to above.

E. Thayer Bigelow, Trustee
245 Park Avenue, Suite 2414
New York, New York

Senior Adviser, Time Warner Inc. Formerly, Acting Chief Executive Officer of
Courtroom Television Network (1997-1998). Formerly, President and Chief
Executive Officer of Time Warner Cable Programming, Inc. (1991-1997). Prior to
that, President and Chief Operating Officer of Home Box Office, Inc. Age 58.

William H. T. Bush, Trustee
Bush-O'Donnell & Co., Inc.
101 South Hanley Road, Suite 1025
St. Louis, Missouri

Co-founder and Chairman of the Board of financial advisory firm of
Bush-O'Donnell & Company (since 1986). Age 61.

Robert B. Calhoun, Jr., Trustee
Monitor Clipper Partners
650 Madison Avenue, 9th Floor
New York, New York

Managing Director of Monitor Clipper Partners (since 1997) and President of The
Clipper Group L.P. , both private equity investment funds (since 1990). Age 57.

Stewart S. Dixon, Trustee
Wildman, Harrold, Allen & Dixon
225 W. Wacker Drive (Suite 2800)
Chicago, Illinois

Partner in the law firm of Wildman, Harrold, Allen & Dixon (since 1990). Age 69.

8
<PAGE>

John C. Jansing, Trustee
162 S. Beach Road
Hobe Sound, Florida

Retired. Former Chairman of Independent Election Corporation of America, a proxy
tabulating firm. Age 74.

C. Alan MacDonald, Trustee
415 Round Hill Road
Greenwich, Connecticut

Currently involved in golf development management on a consultancy basis (since
1999). Formerly, Managing Director of The Directorship Group, Inc., a
consultancy in board management and corporate governance (1997-1999). Prior to
that, General Partner of The Marketing Partnership, Inc., a full service
marketing consulting firm (1994-1997). Prior to that, Chairman and Chief
Executive Officer of Lincoln Snacks, Inc., manufacturer of branded snack foods
(1992-1994). His career spans 36 years at Stouffers and Nestle with 18 of those
years as Chief Executive Officer. Currently serves as Director of DenAmerica
Corp., J.B. Williams Company, Inc., Fountainhead Water Company and Exigent
Diagnostics. Age 66.

Hansel B. Millican, Jr., Trustee
Rochester Button Company
1328 Broadway (Suite 816)
New York, New York

President and Chief Executive Officer of Rochester Button Company (since 1991).
Currently serves as Director of Polyvision. Age 71.

Thomas J. Neff, Trustee
Spencer Stuart
277 Park Avenue
New York, New York

Chairman of Spencer Stuart, an executive search consulting firm (since 1976).
Currently serves as Director of Ace, Ltd. (NYSE). Age 62.

The second column of the following table sets forth the compensation
accrued by the Company for outside directors/trustees. The third column sets
forth information with respect to the pension or retirement benefits accrued by
all Lord Abbett-sponsored funds for outside directors/trustees. The fourth
column sets forth the total compensation paid by all Lord Abbett-sponsored funds
to the outside directors/trustees, and amounts payable but deferred at the
option of the director/trustee. No director/trustee of the funds associated
with Lord Abbett and no officer of the funds received any compensation
from the funds for acting as a director/trustee or officer.

For the Fiscal Year Ended October 31, 1999
------------------------------------------

(1) (2) (3) (4)
Pension or For Year Ended
Retirement Benefits December 31, 1999
Accrued by the Total Compensation
Aggregate Funds and Paid by the Funds and
Compensation Thirteen Other Lord Thirteen Other Lord
Accrued by Abbett-sponsored Abbett-sponsored
Name of Trustee the Fund/1 funds/2 funds /3
- --------------- ---------- ------- --------
<S> <C> <C> <C>
E. Thayer Bigelow $1,709 $17,622 $57,720
William H.T. Bush* $1,703 $15,846 $58,000
Robert B. Calhoun, Jr.** $1,680 $12,276 $57,000
Stewart S. Dixon $1,725 $32,420 $58,500
John C. Jansing $1,680 $41,108(4) $57,250
C. Alan MacDonald $1,695 $26,763 $57,500
Hansel B. Millican, Jr. $1,695 $37,822 $57,500
Thomas J. Neff $1,753 $20,313 $59,660

*Elected as of August 13, 1998
**Elected as of June 17, 1998
</TABLE>

9
<PAGE>

1. Outside directors/trustees' fees, including attendant fees for board
and committee meetings, are allocated among all Lord Abbett-sponsored
funds based on the net assets of each fund. A portion of the fees
payable by the Company to its outside directors/trustees may be
deferred under a plan ("equity- based plan") that deems the deferred
amounts to be invested in shares of the Fund for later distribution to
the directors/trustees. The amounts of the aggregate compensation
payable by the Fund in accordance with the equity-based plan as of
October 31, 1999 is deemed invested in Fund shares, including
dividends reinvested and changes in net asset value applicable to such
deemed investments, were: Mr. Bigelow, $4,084; Mr. Bush, $100; Mr.
Calhoun, $1,710; Mr. Dixon, $16,605; Mr. Jansing, $32,915; Mr.
MacDonald, $15,397; Mr. Millican, $35,157 and Mr. Neff, $34,914. If
the amounts deemed invested in Fund shares were added to each
director's/trustee's actual holdings of Fund shares as of October 31,
1999, each would own the following: Mr. Bigelow, $4,084; Mr. Bush,
$100 ; Mr. Calhoun, $1,710; Mr. Dixon, $21,597.35; Mr. Jansing,
$82,839.67; Mr. MacDonald, $15,397; Mr. Millican, $35,157; and Mr. Neff,
$39,783.65.

2. The amounts in Column 3 were accrued by the Lord Abbett-sponsored funds for
the twelve months ended October 31, 1999.

3. The fourth column shows aggregate compensation, including
directors/trustees' fees and attendance fees for board and committee
meetings, of a nature referred to in footnote one, accrued by the Lord
Abbett-sponsored funds during the year ended December 31, 1999, including
fees directors/trustees have chosen to defer, but does not include amounts
accrued under the equity-based plans and shown in Column 3.

4. The equity-based plans superseded a previously approved retirement plan
for all directors/trustees. Directors/trustees had the option to convert
their accrued benefits under the retirement plan. All of the outside
directors/trustees except one made such election. Mr. Jansing chose to
continue to receive benefits under the retirement plan, which provides that
outside directors/trustees may receive annual retirement benefits for
life equal to their final annual retainer following retirement at or after
age 72 with at least ten years of service. Thus, if Mr. Jansing were to
retire and the annual retainer payable by the funds were the same as it is
today, he would receive annual retirement benefits of $50,000.

Except where indicated, the following executive officers of the Company have
been associated with Lord Abbett for over five years. Messrs. Brown, Carper,
Fetch, Hilstad, Hudson, McGruder, Morris, Towle, and Walsh are partners of Lord
Abbett; the others are employees. None have received compensation from the
Company.

Executive Vice Presidents:
Zane E. Brown, age 48;

Robert P. Fetch, age 47;

W. Thomas Hudson, Jr., age 58;

Stephen I. McGruder, age 56;

Robert G. Morris, age 55.

Eli M. Salzman, age 35 (with Lord Abbett since 1997, formerly a Portfolio
Manager, Analyst at Mutual of America from 1996 to 1997, prior thereto Vice
President at Mitchell Hutchins Asset Management);

Vice Presidents:

Joan Binstock, age 45 (with Lord Abbett since 1999, formerly Chief Operating
Officer of Morgan Grenfell from 1996 to 1999, prior thereto Principal of Ernst &
Young LLP);

Daniel E. Carper, age 48;

Lesley Jane Dixon, age 36;

Gerard S. E. Heffernan, age 36 (with Lord Abbett since 1998, formerly a
Portfolio Manager at CL Capital Management Company; from 1996 to 1998, prior
thereto Equity Research Analyst at CL Capital Management Company);

10
<PAGE>

Paul A. Hilstad, age 57, Vice President and Secretary (with Lord Abbett since
1995, formerly Senior Vice President and General Counsel of American Capital
Management & Research, Inc.);

Timothy W. Horan, age 45;

Cinda C. Hughes, age 37 (with Lord Abbett since 1998, formerly Analyst/Director,
Equity Research at Phoenix Investment Counsel from 1996 to 1998, prior thereto
Associate Strategist - Small-Cap Stocks at Paine Webber, Inc./Kidder, Peabody &
Co., Inc.);

Lawrence H. Kaplan, age 43 (with Lord Abbett since 1997 - formerly Vice
President and Chief Counsel of Salomon Brothers Asset Management Inc. from 1995
to 1997, prior thereto Senior Vice President, Director and General Counsel of
Kidder Peabody Asset Management, Inc.);

Jerald Lanzotti, age 32;

Gregory M. Macosko, age 52 (with Lord Abbett since 1996, formerly an Equity
Analyst and Portfolio Manager at Quest Advisory Inc.);

A. Edward Oberhaus, age 40;

Tracie Richter, age 32 (with Lord Abbett since 1999, formerly Vice President -
Head of Fund Administration of Morgan Grenfell from 1998 to 1999, Vice President
of Bankers Trust from 1996 to 1998, prior thereto Tax Associate of Goldman
Sachs);

Fernando Saldanha, age 45;

Christopher J. Towle, age 42;

John J. Walsh, age 63;

Treasurer:
Donna M. McManus, age 39, Treasurer (with Lord Abbett since 1996, formerly a
Senior Manager at Deloitte & Touche LLP).

As of February 1, 2000, our officers and trustees, as a group, owned 2.26% of
International Series - Class A, and 5.44% of World Bond-Debenture - Class A of
such Fund's outstanding shares. As of February 1, 2000, other than Lord Abbett
Distributor, the following shareholders owned more than 5% of a particular class
of the Fund's outstanding shares: Dorothy A. Allen, P.O. Box 250, New York, NY
owned 5.26% of World Bond-Debenture - Class B; Dorothy R. Rush, Marvin F. Rush,
23 B Heather Way, Candler, NC owned 6.45% of World Bond-Debenture - Class B;
Marvin F. Rush, 23 B Heather Way, Candler, NC owned 6.45% of World
Bond-Debenture - Class B; and Barbara A. Keppel, P.O. Box 10901, Portland, ME
owned 6.45% of World Bond-Debenture - Class C.

3.
Investment Advisory and Other Services

The services performed by Lord Abbett are described under "Management" in the
Prospectus. Under the Management Agreement, each Fund is obligated to pay Lord
Abbett a monthly fee, based on average daily net assets for each month, at the
annual rate of .75 of 1% for the World Bond-Debenture Series and the
International Series, and at an annual rate of .50 of 1% for allocating the
Alpha Series' assets among the underlying funds. Lord Abbett is entitled to a
monthly fee based on the Growth and Income Series average daily net assets for
each month as follows: .75 of 1% on the first $200 million of average daily net
assets, .65 of 1% on the next $300 million, .50 of 1% of the Series' assets over
$500 million. For the fiscal years ended October 31, 1999 and 1998, such fees
amounted to $736,518, and $204,935 for Alpha Series; $1,471,719 and $1,202,319
for Growth & Income Series; $1,450,892 and $700,368 for International Series;
and $90,266 and $39,168 for World Bond-Debenture Series for the same periods.

11
<PAGE>

Each Fund pays all expenses not expressly assumed by Lord Abbett, including,
without limitation, 12b-1 expenses, outside trustees' fees and expenses,
association membership dues, legal and auditing fees, taxes, transfer and
dividend disbursing agent fees, shareholder servicing costs, expenses relating
to shareholder meetings, expenses of preparing, printing and mailing stock
certificates and shareholder reports, expenses of registering our shares under
federal and state securities laws, expenses of preparing, printing and mailing
prospectuses to existing shareholders, insurance premiums, brokerage and other
expenses connected with executing portfolio transactions.

Although not obligated to do so, for the fiscal year ended October 31, 1999,
Lord Abbett has waived or may waive all or part of its management fees and has
assumed or may assume other expenses for the Alpha Series and the World
Bond-Debenture Series. For the fiscal year ended October 31, 1999, Lord Abbett
did not waive management fees for the Growth & Income Series and the
International Series.

Each Fund has agreed with the State of California to limit operating expenses
(including management fees but excluding taxes, interest, extraordinary expenses
and brokerage commissions) to 2 1/2% of average annual net assets up to
$30,000,000, 2% of the next $70,000,000 of such assets and 1 1/2% of such assets
in excess of $100,000,000. However, as described in the Prospectuses, the Funds
have adopted a Plan pursuant to Rule 12b-1 of the Act for each class of shares
of the Funds. Annual Plan distribution expenses up to 1% of the Funds' average
net assets during its fiscal year may be excluded from this expense limitation.
The expense limitation is a condition the registration of investment company
shares for sale in California and applies so long as our shares are registered
for sale in California.

Lord Abbett Distributor LLC, a New York limited liability company ("Lord Abbett
Distributor"), and subsidiary of Lord Abbett, 90 Hudson Street, Jersey City, NJ
07302, serves as the principal underwriter for the Funds.

Deloitte & Touche LLP, Two World Financial Center, New York, New York 10128, are
the independent auditors of the Company and must be approved at least annually
by our trustees to continue in such capacity. Deloitte & Touche LLP perform
audit services for the Company, including the examination of financial
statements included in our annual report to shareholders.

The Bank of New York ("BNY"), 48 Wall Street, New York, New York 10286, is the
Company's custodian. Rules adopted by the Securities & Exchange Commission under
the Act, permit the International Series to maintain its foreign assets in the
custody of certain eligible foreign banks and securities depositories. The
International Series' portfolio securities and cash, when invested in foreign
securities and not held by BNY or its foreign branches, are held by
sub-custodians of BNY approved by the Board of Trustees of the Fund in
accordance with such rules.

The Sub-Custodians of BNY are:
Euro-Clear (a transnational securities depository); Australia: ANZ Banking
Group; Austria: Creditanstalt-Bankverein; Canada: Canadian Imperial Bank of
Commerce; Chile: Citibank, N.A.; Czech Republic: Ceskoslovenska Obchodni Banka;
Denmark: Den Danske Bank; Finland: Union Bank of Finland; Germany: J.P. Morgan
GmbH; Greece: National Bank of Greece S.A.; Hong Kong, Indonesia, Philippines,
Taiwan and Thailand: Hong Kong & Shanghai Banking Corp.; Hungary: Citibank
Budapest Rt; India: Hong Kong and Shanghai Banking Corporation; Ireland: Allied
Irish Banks, PLC; Israel: Bank Leumi LE-Israel B.M.; Japan: The Fuji Bank, Ltd.;
Jordan: Citibank, N.A.; Korea: Bank of Seoul; Luxembourg: Banque Internationale
A Luxembourg, S.A.; Mexico: Citibank, N.A.; Morocco: Banque Commerciale du
Maroc; Netherlands: Bank van Haften Labouchere; New Zealand: Anz Banking Group
Ltd.; Norway: Den Norske Bank; Pakistan: Citibank, N.A.; Peru: Citibank, N.A.;
Poland: Bank Handlowy w Warszawie S.A.; Portugal: Banco Espirito Santo E
Comercial de Lisboa; Malaysia, Singapore: Development Bank of Singapore; South
Africa: The First National Bank of Southern Africa; Sri Lanka: Hong Kong and
Shanghai Banking Corporation; Sweden: Skandinaviska Enskilda Banken;
Switzerland: Bank Leu; Turkey: Citibank, N.A.; Venezuela: Citibank, N.A.

United Missouri Bank of Kansas City, N.A. Tenth and Grand, Kansas City,
Missouri, 64141, acts as the transfer agent and dividend disbursing agent for
each Fund.

12
<PAGE>

4.
Portfolio Transactions

The Fund's policy is to obtain best execution on all our portfolio transactions,
which means that we seek to have purchases and sales of portfolio securities
executed at the most favorable prices, considering all costs of the transaction
including brokerage commissions and dealer markups and markdowns and taking into
account the full range and quality of the brokers' services. Consistent with
obtaining best execution, the Funds may pay, as described below, a higher
commission than some brokers might charge on the same transaction. Our policy
with respect to best execution governs the selection of brokers or dealers and
the market in which the transaction is executed. To the extent permitted by law,
we may, if we consider it advantageous, make a purchase from or sale to another
Lord Abbett-sponsored fund without the intervention of any broker-dealer.

Broker-dealers are selected on the basis of their professional capability and
the value and quality of their brokerage and research services. Normally, the
selection is made by traders who are officers of the Company and also are
employees of Lord Abbett. These traders do the trading as well for other
accounts -- investment companies (of which they are also officers) and other
investment clients -- managed by Lord Abbett. For foreign securities purchased
or sold by the International Series, the selection is made by the Sub-Adviser.
The Sub-Adviser is responsible for obtaining best execution.

In transactions on stock exchanges in the United States, commissions are
negotiated, whereas on many foreign stock exchanges commissions are fixed. In
the case of securities traded in the foreign and domestic over-the-counter
markets, there is generally no stated commission, but the price usually includes
an undisclosed commission or markup. Purchases from underwriters of newly-issued
securities for inclusion in each Fund's portfolio usually will include a
concession paid to the underwriter by the issuer and purchases from dealers
serving as market makers will include the spread between the bid and asked
prices. When commissions are negotiated, we pay a commission rate that we
believe is appropriate to give maximum assurance that our brokers will provide
us, on a continuing basis, the highest level of brokerage services available.
While we do not always seek the lowest possible commission on particular trades,
we pay a commission rate that we believe is appropriate to give maximum
assurance that our brokers will provide us, on a continuing basis, the highest
level of brokerage services available. While we do not always seek the lowest
possible commissions on particular trades, we believe that our commission rates
are in line with the rates that many other institutions pay. Our traders are
authorized to pay brokerage commissions in excess of those that other brokers
might accept on the same transactions in recognition of the value of the
services performed by the executing brokers, viewed in terms of either the
particular transaction or the overall responsibilities of Lord Abbett with
respect to the Fund and the other accounts they manage. Such services include
showing us trading opportunities including blocks, a willingness and ability to
take positions in securities, knowledge of a particular security or market,
proven ability to handle a particular type of trade, confidential treatment,
promptness and reliability.

Some of our brokers also provide research services at least some of which are
useful to Lord Abbett in their overall responsibilities with respect to us and
the other accounts they manage. Research includes the furnishing of analyses and
reports concerning issuers, industries, securities, economic factors and trends,
portfolio strategy and the performance of accounts and trading equipment and
computer software packages, acquired from third-party suppliers, that enable
Lord Abbett to access various information bases. Such services may be used by
Lord Abbett in servicing all their accounts, and not all of such services will
necessarily be used by Lord Abbett in connection with their management of the
Funds; conversely, such services furnished in connection with brokerage on other
accounts managed by Lord Abbett may be used in connection with their management
of the Funds; and not all of such services will necessarily be used by Lord
Abbett in connection with their advisory services to such other accounts. The
Funds have been advised by Lord Abbett that research services received from
brokers cannot be allocated to any particular account, are not a substitute for
Lord Abbett's services but are supplemental to their own research effort and,
when utilized, are subject to internal analysis before being incorporated by
Lord Abbett into their investment process. As a practical matter, it would not
be possible for Lord Abbett to generate all of the information presently
provided by brokers. While receipt of research services from brokerage firms has
not reduced Lord Abbett's normal research activities, the expenses of Lord
Abbett could be materially increased if it attempted to generate such additional
information through its own staff and purchased such equipment and software
packages directly from the suppliers.

No commitments are made regarding the allocation of brokerage business to or
among brokers, and trades are executed only when they are dictated by investment
decisions of the Lord Abbett-sponsored funds to purchase or sell portfolio
securities.

13
<PAGE>

If two or more broker-dealers are considered capable of offering the equivalent
likelihood of best execution, the broker-dealer whom has sold the Lord
Abbett-sponsored funds' shares and/or shares of other Lord Abbett-sponsored
funds may be preferred.

If other clients of Lord Abbett buy or sell the same security at the same time a
Lord Abbett-sponsored fund does, transactions will, to the extent practicable,
be allocated among all participating accounts in proportion to the amount of
each order and will be executed daily until filled so that each account shares
the average price and commission cost of each day. Other clients who direct that
their brokerage business be placed with specific brokers or who invest through
wrap accounts introduced to Lord Abbett by certain brokers may not participate
with a Lord Abbett-sponsored fund in the buying and selling of the same
securities as described above. If these clients wish to buy or sell the same
security as we do, they may have their transactions executed at times different
from our transactions and thus may not receive the same price or incur the same
commission cost as a Lord Abbett-sponsored fund does.

The Lord Abbett-sponsored funds will not seek "reciprocal" dealer business (for
the purpose of applying commissions in whole or in part for our benefit or
otherwise) from dealers as consideration for the direction to them of portfolio
business.

For the fiscal years ended October 31, 1997, 1998, and 1999, we paid total
commissions to independent broker-dealers of $273,174, $466,874, and $260,023.

5.
Purchases, Redemptions
and Shareholder Services

Information concerning how we value our Shares for the purchase and redemption
of our Shares is described in the Prospectus under "Purchases" and
"Redemptions," respectively.

As disclosed in the Prospectus, we calculate our net asset value as of the close
of the New York Stock Exchange ("NYSE") on each day that the NYSE is open for
trading by dividing our total net assets by the number of shares outstanding at
the time of calculation. The NYSE is closed on Saturdays and Sundays and the
following holidays -- New Year's Day, Martin Luther King, Jr., Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and
Christmas.

The Funds value their portfolios securities at market value as of the close of
the NYSE. Market value will be determined as follows: securities listed or
admitted to trading privileges on any national or foreign securities exchange or
on the NASDAQ National Market System are valued at the last sales price, or, if
there is no sale on that day, at the mean between the last bid and asked prices,
or, in the case of bonds, in the over-the-counter market if, in the judgment of
the Funds' officers, that market more accurately reflects the market value of
the bonds. Over-the-counter securities not traded on the NASDAQ National Market
System are valued at the mean between the last bid and asked prices. Securities
for which market quotations are not available are valued at fair value under
procedures approved by the Board of Trustees.

All assets and liabilities expressed in foreign currencies will be converted
into United States dollars at the mean between the buying and selling rates of
such currencies against United States dollars last quoted by any major bank. If
such quotations are not available, the rate of exchange will be determined in
accordance with policies established by the Funds' Board of Trustees. The Board
of Trustees will monitor, on an ongoing basis, the Funds' method of valuation.

For each class of shares, the net asset value will be determined by taking the
net asset value and dividing by the number of shares outstanding.

14
<PAGE>

The maximum offering prices of each Fund's Class A shares on October 31, 1999
were computed as follows:
<TABLE>
<CAPTION>

Alpha Growth & Income
Series Series
------ ---------------
<S> <C> <C>
Net asset value per share (net assets
divided by shares outstanding) $15.21 $10.87

Maximum offering price per
share (net asset value divided by .9425 in both cases) $16.14 $11.53

International World Bond-Debenture
Series Series
------ -----------------------

Net asset value per share (net assets
divided by shares outstanding) $13.90 $9.24

Maximum offering price per
share (net asset value divided by
.9425 and .9525, respectively) $14.75 $9.70
</TABLE>

The Funds have entered into a distribution agreement with Lord Abbett
Distributor under which Lord Abbett Distributor is obligated to use its best
efforts to find purchasers for the shares of the Funds, and to make reasonable
efforts to sell Fund shares so long as, in Lord Abbett Distributor's judgment, a
substantial distribution can be obtained by reasonable efforts.

For the last three fiscal years, Lord Abbett, as our principal underwriter,
received net commissions after allowance of a portion of the sales charge to
independent dealers with respect to Class A shares as follows:
<TABLE>
<CAPTION>

Year Ended October 31

1999 1998 1997
-------------- ------------- -------
<S> <C> <C> <C>
Gross sales charge $2,562,452 $4,398,403 $696,685

Amount allowed to dealers $2,199,701 $3,780,924 $605,528
---------- ---------- --------
Net commissions
received by Lord Abbett $367,751 $617,479 $ 91,157
======== ======== ========
</TABLE>

Conversion of Class B Shares. The conversion of Class B shares on the eighth
anniversary of their purchase is subject to the continuing availability of a
private letter ruling from the Internal Revenue Service, or an opinion of
counsel or tax adviser, to the effect that the conversion of Class B shares does
not constitute a taxable event for the holder under Federal income tax law. If
such a revenue ruling or opinion is no longer available, the automatic
conversion feature may be suspended, in which event no further conversions of
Class B shares would occur while such suspension remained in effect. Although
Class B shares could then be exchanged for Class A shares on the basis of
relative net asset value of the two classes, without the imposition of a sales
charge or fee, such exchange could constitute a taxable event for the holder.

Alternative Sales Arrangements

Classes of Shares. The Funds offer investors four different classes of shares in
this Statement of Additional Information. The different classes of shares
represent investments in the same portfolio of securities but are subject to
different expenses and will likely have different share prices. Investors should
read this section carefully to determine which class represents the best
investment option for their particular situation.

Class A Shares. If you buy Class A shares you pay an initial sales charge,
unless your purchase meets one of the following conditions: (i) your purchase is

15
<PAGE>

for $1 million or more in one or more Lord Abbett-sponsored funds; (ii) you
purchase through an employer-sponsored retirement plan (a "Retirement Plan")
with at least 100 eligible employees under the Internal Revenue Code (which
excludes Individual Retirement Accounts); or (iii) you purchase through a
"special retirement program" which is a certain type program sponsored by an
institution or other entity permitted to receive service and/or distribution
fees under a Rule 12b-1 Plan (an "Authorized Institution"). The program must
also have one or more characteristics distinquishing it, in the opinion of Lord
Abbett Distributor, from a Mutual Fund Fee Based Program. Such characteristics
include, among other things, the fact that an Authorized Institution does not
charge its clients any fee of a consulting or advisory nature that is
economically equivalent to the distribution fee under the Class A 12b-1 Plan and
the fact that the program relates to participant-directed Retirement Plans.
However, if you meet a condition which allows you to purchase Class A shares
without an initial sales charge, but you redeem any of those shares within 24
months after the month in which you buy them, you pay the Fund a contingent
deferred sales charge ("CDSC") of 1%. There is an exception to the CDSC for
redemptions under a special retirement wrap program. Class A shares are subject
to service and distribution fees at an annual rate of 33 of 1% of the annual net
asset value of the Class A shares. The initial sales charge rates, the CDSC, and
the Rule 12b-1 Plan applicable to the Class A shares are described in the
sections below.

Class B Shares. If you buy Class B shares, you pay no sales charge at the time
of purchase, but if you redeem your shares before the sixth anniversary of
buying them, you will normally pay a CDSC to Lord Abbett Distributor. That CDSC
varies depending on how long you own the shares. Class B shares are subject to
service and distribution fees at an annual rate of 1% of the annual net asset
value of the Class B shares. The CDSC and the Rule 12b-1 plan applicable to the
Class B shares are described in the sections below.

Class C Shares. If you buy Class C shares, you pay no sales charge at the time
of purchase, but if you redeem your shares before the first anniversary of
buying them, you will normally pay the Fund a CDSC of 1%. Class C shares are
subject to service and distribution fees at an annual rate of 1% of the annual
net asset value of the Class C shares. The CDSC and the Rule 12b-1 plan
applicable to the Class C shares are described in the sections below.

Class P Shares. If you buy Class P shares, you pay no sales charge at the time
of purchase, and if you redeem your shares you pay no CDSC. Class P shares are
subject to service and distribution fees at an annual rate of .45 of 1% of the
average daily net asset value of the Class P shares. The Rule 12b-1 plan
applicable to the Class P shares is described in the section below. Class P
shares are available to a limited number of investors.

Which Class of Shares Should You Choose? Once you decide that the a Fund is an
appropriate investment for you, the decision as to which class of shares is
better suited to your needs depends on a number of factors which you should
discuss with your financial adviser. The Fund's class-specific expenses and the
effect of the different types of sales charges on your investment will affect
your investment results over time. The most important factors are how much you
plan to invest and how long you plan to hold your investment. If your goals and
objectives change over time and you plan to purchase additional shares, you
should re-evaluate those factors to see if you should consider another class of
shares.

In the following discussion, to help provide you and your financial adviser with
a framework in which to choose a class, we have made some assumptions using a
hypothetical investment in the Fund. We used the sales charge rates that apply
to Class A, Class B and Class C, and considered the effect of the higher
distribution fees on Class B and Class C expenses (which will affect your
investment return). Of course, the actual performance of your investment cannot
be predicted and will vary, based on the Fund's actual investment returns, the
operating expenses borne by each class of shares, and the class of shares you
purchase. The factors briefly discussed below are not intended to be investment
advice, guidelines or recommendations, because each investor's financial
considerations are different. The discussion below of the factors to consider in
purchasing a particular class of shares assumes that you will purchase only one
class of shares and not a combination of shares of different classes.

How Long Do You Expect to Hold Your Investment? While future financial needs
cannot be predicted with certainty, knowing how long you expect to hold your
investment will assist you in selecting the appropriate class of shares. For
example, over time, the reduced sales charges available for larger purchases of
Class A shares may offset the effect of paying an initial sales charge on your
investment, compared to the effect over time of higher class-specific expenses
on Class B or Class C shares for which no initial sales charge is paid. Because
of the effect of class-based expenses, your choice should also depend on how
much you plan to invest.

16
<PAGE>

Investing for the Short Term. If you have a short-term investment horizon (that
is, you plan to hold your shares for not more than six years), you should
probably consider purchasing Class A or Class C shares rather than Class B
shares. This is because of the effect of the Class B CDSC if you redeem before
the sixth anniversary of your purchase, as well as the effect of the Class B
distribution fee on the investment return for that class in the short term.
Class C shares might be the appropriate choice (especially for investments of
less than $100,000), because there is no initial sales charge on Class C shares,
and the CDSC does not apply to amounts you redeem after holding them one year.

However, if you plan to invest more than $100,000 for the short term, then the
more you invest and the more your investment horizon increases toward six years,
the more attractive the Class A share option may become. This is because the
annual distribution fee on Class C shares will have a greater impact on your
account over the longer term than the reduced front-end sales charge available
for larger purchases of Class A shares. For example, Class A might be more
appropriate than Class C for investments of more than $100,000 expected to be
held for 5 or 6 years (or more). For investments over $250,000 expected to be
held 4 to 6 years (or more), Class A shares may become more appropriate than
Class C. If you are investing $500,000 or more, Class A may become more
desirable as your investment horizon approaches 3 years or more.

For most investors who invest $1 million or more or for Retirement Plans with at
least 100 eligible employees or for investments pursuant to a special retirement
wrap program, in most cases Class A shares will be the most advantageous choice,
no matter how long you intend to hold your shares. For that reason, it may not
be suitable for you to place a purchase order for Class B shares of $500,000 or
more or a purchase order for Class C shares of $1,000,000 or more. In addition,
it may not be suitable for you to place an order for Class B or C shares for a
Retirement Plan with at least 100 eligible employees or for a special retirement
wrap program. You should discuss this with your financial advisor.

Investing for the Longer Term. If you are investing for the longer term (for
example, to provide for future college expenses for your child) and do not
expect to need access to your money for seven years or more, Class B shares may
be an appropriate investment option, if you plan to invest less than $100,000.
If you plan to invest more than $100,000 over the long term, Class A shares will
likely be more advantageous than Class B shares or Class C shares, as discussed
above, because of the effect of the expected lower expenses for Class A shares
and the reduced initial sales charges available for larger investments in Class
A shares under the Fund's Rights of Accumulation, described in greater detail
below under "Rights of Accumulation."

Of course, these examples are based on approximations of the effect of current
sales charges and expenses on a hypothetical investment over time, and should
not be relied on as rigid guidelines.

Are There Differences in Account Features That Matter to You? Some account
features are available in whole or in part to Class A, Class B and Class C
shareholders. Other features (such as Systematic Withdrawal Plans) might not be
advisable in non-Retirement Plan accounts for Class B shareholders (because of
the effect of the CDSC on the entire amount of a withdrawal if it exceeds 12%
annually) and in any account for Class C shareholders during the first year of
share ownership (due to the CDSC on withdrawals during that year). See
"Systematic Withdrawal Plan" under "Shareholder Services" in the Prospectus for
more information about the 12% annual waiver of the CDSC. You should carefully
review how you plan to use your investment account before deciding which class
of shares you buy. For example, the dividends payable to Class B and Class C
shareholders will be reduced by the expenses borne solely by each of these
classes, such as the higher distribution fee to which Class B and Class C shares
are subject, as described below.

How Does It Affect Payments to My Broker? A salesperson, such as a broker, or
any other person who is entitled to receive compensation for selling Fund shares
may receive different compensation for selling one class than for selling
another class. As discussed in more detail below, such compensation is primarily
paid at the time of sale in the case of Class A and B shares and is paid over
time, so long as shares remain outstanding, in the case of Class C shares. It is
important that investors understand that the primary purpose of the CDSC for the
Class B shares and the distribution fee for Class B and Class C shares is the
same as the purpose of the front-end sales charge on sales of Class A shares: to
compensate brokers and other persons selling such shares. The CDSC, if payable,
supplements the Class B distribution fee and reduces the Class C distribution
fee expenses for the Funds and Class C shareholders.

17
<PAGE>

Rule 12b-1 Plans

Class A, B, C, and P. As described in the Prospectus, each Fund has adopted a
Distribution Plan and Agreement pursuant to Rule 12b-1 of the Act for each of
the four Classes: the "A Plan," the "B Plan," the "C Plan," and the "P Plan,"
respectively. In adopting each Plan and in approving its continuance, the Board
of Trustees has concluded that there is a reasonable likelihood that each Plan
will benefit its respective Class and such Class' shareholders. The expected
benefits include greater sales and lower redemptions of Class shares, which
should allow each Class to maintain a consistent cash flow, and a higher quality
of service to shareholders by authorized institutions than would otherwise be
the case. During the last fiscal year, the Company accrued or paid through Lord
Abbett to authorized institutions $831,148 under the A Plan, $773,602 under the
B Plan , $1,501,937 under the C Plan and $3 under the P Plan. Lord Abbett uses
all amounts received under each Plan as described in the Prospectus, for
payments to dealers who (i) provide continuous services to the shareholders,
such as answering shareholder inquiries, maintaining records, and assisting
shareholders in making redemptions, transfers, additional purchases and
exchanges and (ii) who assist in distributing shares of the Funds.

Each Plan requires the Trustees to review, on a quarterly basis, written reports
of all amounts expended pursuant to the Plan and the purposes for which such
expenditures were made. Each Plan shall continue in effect only if its
continuance is specifically approved at least annually by vote of the Trustees,
including a majority of the Trustees who are not interested persons of the Fund
and who have no direct or indirect financial interest in the operation of the
Plan or in any agreements related to the Plan ("outside Trustees"), cast in
person at a meeting called for the purpose of voting on the Plan. No Plan may be
amended to increase materially above the limits set forth therein the amount
spent for distribution expenses thereunder without approval by a majority of the
outstanding voting securities of the applicable class and the approval of a
majority of the Trustees, including a majority of the outside Trustees. Each
Plan may be terminated at any time by vote of a majority of the outside Trustees
or by vote of a majority of its Class' outstanding voting securities.

Contingent Deferred Sales Charges. A Contingent Deferred Sales Charge ("CDSC"),
applies upon early redemption of shares regardless of class, and (i) will not
apply to shares purchased by the reinvestment of dividends or capital gains
distributions; (ii) will be assessed on the lesser of the net asset value of the
shares at the time of redemption or the original purchase price and (iii) will
not be imposed on the amount of your account value represented by the increase
in net asset value over the initial purchase price (including increases due to
the reinvestment of dividends and capital gains distributions) and upon early
redemption of shares. In the case of Class A shares, this increase is
represented by shares having an aggregate dollar value in your account. In the
case of Class B and C shares, this increase is represented by that percentage of
each share redeemed where the net asset value exceeded the initial purchase
price.

Class A Shares. As stated in the Prospectus, a CDSC of 1% may be imposed with
respect to those Class A shares (or Class A shares of another Lord
Abbett-sponsored fund acquired through exchange of such shares) on which a Fund
has paid the one-time distribution fee of 1% if such shares are redeemed out of
the Lord Abbett-sponsored family of funds within a period of 24 months from the
end of the month in which the original sale occurred.

Class B Shares. As stated in the Prospectus, if Class B shares (or Class B
shares of another Lord Abbett-sponsored fund acquired through exchange of such
shares) are redeemed out of the Lord Abbett-sponsored family of funds for cash
before the sixth anniversary of their purchase, a CDSC will be deducted from the
redemption proceeds. The Class B CDSC is paid to Lord Abbett Distributor to
reimburse its expenses, in whole or in part, for providing distribution-related
service in connection with the sale of Class B shares.

To determine whether the CDSC applies to a redemption, the Funds redeem shares
in the following order: (1) shares acquired by reinvestment of dividends and
capital gains distributions, (2) shares held on or after the sixth anniversary
of their purchase, and (3) shares held the longest before such sixth
anniversary.

The amount of the CDSC will depend on the number of years since you invested and
the dollar amount being redeemed, according to the following schedule:

18
<PAGE>

Anniversary of the Day on Contingent Deferred Sales Charge
Which the Purchase Order Was Accepted on Redemptions (as % of Amount Subject to Charge)
<S> <C>
Before the 1st 5.0%
On the 1st, before the 2nd 4.0%
On the 2nd, before the 3rd 3.0%
On the 3rd, before the 4th 3.0%
On the 4th, before the 5th 2.0%
On the 5th, before the 6th 1.0%
On or after the 6th anniversary None
</TABLE>

In the above table, "anniversary" is the same calendar day in each respective
year after the date of purchase. All purchases are considered to have been made
on the business day on which the purchase order was accepted.

Class C Shares. As stated in the Prospectus, subject to certain exceptions, if
Class C shares are redeemed for cash before the first anniversary of their
purchase, the redeeming shareholder normally will be required to pay to the
Funds on behalf of Class C shares a CDSC of 1% of the lower of cost or the then
net asset value of Class C shares redeemed. If such shares are exchanged into
the same class of another Lord Abbett-sponsored fund and subsequently redeemed
before the first anniversary of their original purchase, the charge will be
collected by the other fund on behalf of this Fund's Class C shares.

General. The percentage (1% in the case of Class A and C shares and 5% through
1% in the case of Class B shares) used to calculate CDSCs described above for
the Class A, Class B and Class C shares is sometimes hereinafter referred to as
the "Applicable Percentage."

With respect to Class A and Class B shares, no CDSC is payable on redemptions by
participants or beneficiaries from employer-sponsored retirement plans under the
Internal Revenue Code for benefit payments due to plan loans, hardship
withdrawals, death, retirement or separation from service and for returns of
excess contributions to retirement plan sponsors. With respect to Class A shares
purchased pursuant to a special retirement wrap program, no CDSC is payable on
redemptions which continue as investments in another fund participating in the
program. With respect to Class B shares, no CDSC is payable for redemptions (i)
in connection with Systematic Withdrawal Plan and Div-Move services as described
below under those headings, (ii) in connection with mandatory distribution under
403(b) plans and IRAs and (iii) in connection with death of the shareholder. In
the case of Class A and Class C shares, the CDSC is received by the Fund and is
intended to reimburse all or a portion of the amount paid by the Fund if the
shares are redeemed before the Fund has had an opportunity to realize the
anticipated benefits of having a long-term shareholder account in the Fund. In
the case of Class B shares, the CDSC is received by Lord Abbett Distributor and
is intended to reimburse its expenses of providing distribution-related service
to the Fund (including recoupment of the commission payments made) in connection
with the sale of Class B shares before Lord Abbett Distributor has had an
opportunity to realize its anticipated reimbursement by having such a long-term
shareholder account subject to the B Plan distribution fee.

The other funds which participate in the Telephone Exchange Privilege (except
(a) Lord Abbett U.S. Government Securities Money Market Fund, Inc. ("GSMMF"),
(b) certain funds of Lord Abbett Tax-Free Income Fund and Lord Abbett Tax-Free
Income Trust for which a Rule 12b-1 Plan is not yet in effect, and (c) any
authorized institution's affiliated money market fund satisfying Lord Abbett
Distributor as to certain omnibus account and other criteria, hereinafter
referred to as an "authorized money market fund" or "AMMF" (collectively, the
"Non-12b-1 Funds")) have instituted a CDSC for each class on the same terms and
conditions. No CDSC will be charged on an exchange of shares of the same class
between Lord Abbett funds or between such funds and AMMF. Upon redemption of
shares out of the Lord Abbett-sponsored Family of Funds or out of AMMF, the CDSC
will be charged on behalf of and paid: (i) to the fund in which the original
purchase (subject to a CDSC) occurred, in the case of the Class A and Class C
shares and (ii) to Lord Abbett Distributor if the original purchase was subject
to a CDSC, in the case of the Class B shares. Thus, if shares of a Lord
Abbett-sponsored fund are exchanged for shares of the same class of another such
fund and the shares of the same class tendered ("Exchanged Shares") are subject
to a CDSC, the CDSC will carry over to the shares of the same class being
acquired, including GSMMF and AMMF ("Acquired Shares"). Any CDSC that is carried
over to Acquired Shares is calculated as if the holder of the Acquired Shares
had held those shares from the date on which he or she became the holder of the
Exchanged Shares. Although the Non-12b-1 Funds will not pay a distribution fee
on their own shares, and will, therefore, not impose their own CDSC, the
Non-12b-1 Funds will collect the CDSC (a) on behalf of other Lord
Abbett-sponsored funds, in the case of the Class A and Class C shares and (b) on
behalf of Lord Abbett Distributor, in the case of the Class B shares. Acquired

19
<PAGE>

Shares held in GSMMF and AMMF which are subject to a CDSC will be credited with
the time such shares are held in GSMMF but will not be credited with the time
such shares are held in AMMF. Therefore, if your Acquired Shares held in AMMF
qualified for no CDSC or a lower Applicable Percentage at the time of exchange
into AMMF, that Applicable Percentage will apply to redemptions for cash from
AMMF, regardless of the time you have held Acquired Shares in AMMF.

In no event will the amount of the CDSC exceed the Applicable Percentage of the
lesser of (i) the net asset value of the shares redeemed or (ii) the original
cost of such shares (or of the Exchanged Shares for which such shares were
acquired). No CDSC will be imposed when the investor redeems (i) shares
representing an aggregate dollar amount of your account, in the case of Class A
shares, (ii) that percentage of each share redeemed, in the case of Class B and
Class C shares, derived from increases in the value of the shares above the
total cost of shares being redeemed due to increases in net asset value, (ii)
shares with respect to which no Lord Abbett-sponsored fund paid a 12b-1 fee and,
in the case of Class B shares, Lord Abbett Distributor paid no sales charge or
service fee (including shares acquired through reinvestment of dividend income
and capital gains distributions) or (iii) shares which, together with Exchanged
Shares, have been held continuously for 24 months from the end of the month in
which the original sale occurred (in the case of Class A shares); for six years
or more (in the case of Class B shares) and for one year or more (in the case of
Class C shares). In determining whether a CDSC is payable, (a) shares not
subject to the CDSC will be redeemed before shares subject to the CDSC and (b)
of the shares subject to a CDSC, those held the longest will be the first to be
redeemed.

Exchanges. The Prospectus briefly describes the Telephone Exchange Privilege.
You may exchange some or all of your shares of any class for those in the same
class of: (i) Lord Abbett-sponsored funds currently offered to the public with a
sales charge (front-end, back-end or level ), (ii) GSMMF, or (iii) AMMF, to the
extent offers and sales may be made in your state. You should read the
prospectus of the other fund before exchanging. In establishing a new account by
exchange, shares of the fund being exchanged must have a value equal to at least
the minimum initial investment required for the other fund into which the
exchange is made.

Shareholders in other Lord Abbett-sponsored funds and AMMF have the same right
to exchange their shares for the corresponding class of the Fund's shares.
Exchanges are based on relative net asset values on the day instructions are
received by the Fund in Kansas City if the instructions are received prior to
the close of the NYSE in proper form. No sales charges are imposed except in the
case of exchanges out of GSMMF or AMMF (unless a sales charge (front-end,
back-end or level) was paid on the initial investment in a Lord Abbett-sponsored
fund). Exercise of the exchange privilege will be treated as a sale for federal
income tax purposes, and, depending on the circumstances, a gain or loss may be
recognized. In the case of an exchange of shares that have been held for 90 days
or less where no sales charge is payable on the exchange, the original sales
charge incurred with respect to the exchanged shares will be taken into account
in determining gain or loss on the exchange only to the extent such charge
exceeds the sales charge that would have been payable on the acquired shares had
they been acquired for cash rather than by exchange. The portion of the original
sales charge not so taken into account will increase the basis of the acquired
shares.

Shareholders have the exchange privilege unless they refuse it in writing. You
should not view the exchange privilege as a means for taking advantage of
short-term swings in the market, and we reserve the right to terminate or limit
the privilege of any shareholder who makes frequent exchanges. We can revoke or
modify the privilege for all shareholders upon 60 days' prior notice. "Eligible
Funds" are AMMF and other Lord Abbett-sponsored funds which are eligible for the
exchange privilege, except Lord Abbett Series Fund ("LASF") which offers its
shares only in connection with certain variable annuity contracts, Lord Abbett
Equity Fund ("LAEF") which is not issuing shares. The exchange privilege will
not be available with respect to any otherwise "Eligible Funds" the shares of
which at the time are not available to new investors of the type requesting the
exchange.

Statement of Intention. Under the terms of the Statement of Intention, as
described in the Prospectus, you may invest $50,000 or more over a 13-month
period in shares of a Lord Abbett-sponsored fund (other than shares of LAEF,
LASF, LARF, GSMMF and AMMF, unless holdings in GSMMF and AMMF are attributable
to shares exchanged from a Lord Abbett-sponsored fund offered with a front-end,
back-end or level sales charge). Shares currently owned by you are credited as
purchases (at their current offering prices on the date the Statement is signed)
toward achieving the stated investment and reduced initial sales charge for
Class A shares. Class A shares valued at 5% of the amount of intended purchases
are escrowed and may be redeemed to cover the additional sales charge payable if
the Statement is not completed. The Statement of Intention is neither a binding
obligation on you to buy, nor on the Fund to sell, the full amount indicated.

20
<PAGE>

Rights of Accumulation. As stated in the Prospectus, purchasers (as defined in
the Prospectus) may accumulate their investment in Lord Abbett-sponsored funds
(other than LAEF, LARF, LASF, GSMMF, and AMMF unless holdings in GSMMF or AMMF
are attributable to shares exchanged from a Lord Abbett-sponsored fund offered
with a front-end, back-end or level sales charge) so that a current investment,
plus the purchaser's holdings valued at the current maximum offering price,
reach a level eligible for a discounted sales charge for Class A shares.

Net Asset Value Purchases of Class A Shares. As stated in the Prospectus, our
Class A shares may be purchased at net asset value by our trustees, employees of
Lord Abbett, employees of our shareholder servicing agent and employees of any
securities dealer having a sales agreement with Lord Abbett who consents to such
purchases or by the trustee or custodian under any pension or profit-sharing
plan or Payroll Deduction IRA established for the benefit of such persons or for
the benefit of employees of any national securities trade organization to which
Lord Abbett belongs or any company with an account(s) in excess of $10 million
managed by Lord Abbett on a private-advisory-account basis. For purposes of this
paragraph, the terms "trustees" and "employees" include a trustee's or
employee's spouse (including the surviving spouse of a deceased director/trustee
or employee). The terms "our trustees" and "employees of Lord Abbett" also
include retired trustees and employees and other family members thereof.

Our Class A shares also may be purchased at net asset value (a) at $1 million or
more, (b) with dividends and distributions from Class A shares of other Lord
Abbett-sponsored funds, except for LARF, LAEF and LASF, (c) under the loan
feature of the Lord Abbett-sponsored prototype 403(b) plan for share purchases
representing the repayment of principal and interest, (d) by certain authorized
brokers, dealers, registered investment advisers or other financial institutions
who have entered into an agreement with Lord Abbett Distributor, in accordance
with certain standards approved by Lord Abbett Distributor, providing
specifically for the use of our shares in particular investment products made
available for a fee to clients of such brokers, dealers, registered investment
advisers and other financial institutions, ("mutual fund wrap fee program"), (e)
by employees, partners and owners of unaffiliated consultants and advisors to
Lord Abbett, Lord Abbett Distributor or Lord Abbett-sponsored funds who consent
to such purchase if such persons provide service to Lord Abbett, Lord Abbett
Distributor or such funds on a continuing basis and are familiar with such funds
(f) through Retirement Plans with at least 100 eligible employees, (g) in
connection with a merger, acquisition or other reorganization, and (h) through a
"special retirement wrap program" sponsored by an authorized institution having
one or more characteristics distinguishing it, in the opinion of Lord Abbett
Distributor, from a mutual fund wrap program. Such characteristics include,
among other things, the fact that an authorized institution does not charge its
clients any fee of a consulting or advisory nature that is economically
equivalent to the distribution fee under the Class A 12b-1 Plan and the fact
that the program relates to participant-directed Retirement Plan. Shares are
offered at net asset value to these investors for the purpose of promoting
goodwill with employees and others with whom Lord Abbett Distributor and/or the
Fund has business relationships.

Redemptions. A redemption order is in proper form when it contains all of the
information and documentation required by the order form or supplementally by
Lord Abbett Distributor or the Funds to carry out the order. The signature(s)
and any legal capacity of the signer(s) must be guaranteed by an Eligible
Guarantor, which is any broker or bank that is a member of the medallion stamp
program. See the Prospectus for expedited redemption procedures.

The right to redeem and receive payment, as described in the Prospectus, may be
suspended if the NYSE is closed (except for weekends or customary holidays),
trading on the NYSE is restricted, or the Securities and Exchange Commission
deems an emergency to exist.

Our Board of Trustees may authorize redemption of all of the shares in any
account in which there are fewer than 25 shares. Before authorizing such
redemption, the Board must determine that it is in our economic best interest or
necessary to reduce disproportionately burdensome expenses in servicing
shareholder accounts. At least 6 months prior, written notice will be given
before any such redemption, during which time shareholders may avoid redemption
by bringing their accounts up to the minimum set by the Board.

Div-Move. Under the Div-Move service described in the Prospectus, you can invest
the dividends paid on your account of any class into an existing account of the
same class in any other Eligible Fund. The account must be either your account,
a joint account for you and your spouse, a single account for your spouse, or a
custodial account for your minor child under the age of 21. You should read the
prospectus of the other fund before investing.

21
<PAGE>

Invest-A-Matic. The Invest-A-Matic method of investing in the Funds and/or any
other Eligible Fund is described in the Prospectus. To avail yourself of this
method you must complete the application form, selecting the time and amount of
your bank checking account withdrawals and the funds for investment, include a
voided, unsigned check and complete the bank authorization.

Systematic Withdrawal Plans. The Systematic Withdrawal Plan ("SWP") also is
described in the Prospectus. You may establish a SWP if you own or purchase
uncertificated shares having a current offering price value of at least $10,000.
Lord Abbett prototype retirement plans have no such minimum. With respect to
Class B shares the CDSC will be waived on redemptions of up to 12% per year of
the current net asset value of your account at the time the SWP is established.
For Class B shares redemptions over 12% per year, the CDSC will apply to the
entire redemption. Therefore, please contact the Fund for assistance in
minimizing the CDSC in this situation. With respect to Class C shares, the CDSC
will be waived on and after the first anniversary of their purchase. The SWP
involves the planned redemption of shares on a periodic basis by receiving
either fixed or variable amounts at periodic intervals. Since the value of
shares redeemed may be more or less than their cost, gain or loss may be
recognized for income tax purposes on each periodic payment. Normally, you may
not make regular investments at the same time you are receiving systematic
withdrawal payments because it is not in your interest to pay a sales charge on
new investments when in effect a portion of that new investment is soon
withdrawn. The minimum investment accepted while a withdrawal plan is in effect
is $1,000. The SWP may be terminated by you or by us at any time by written
notice.

Retirement Plans. The Prospectus indicates the types of retirement plans for
which Lord Abbett provides forms and explanations. Lord Abbett makes available
the retirement plan forms including 401(k) plans and custodial agreements for
IRAs (Individual Retirement Accounts, including Simple IRAs and Simplified
Employee Pensions), 403(b) plans and qualified pension and profit-sharing plans.
The forms name Investors Fiduciary Trust Company as custodian and contain
specific information about the plans excluding 401(k) plans. Explanations of the
eligibility requirements, annual custodial fees and allowable tax advantages and
penalties are set forth in the relevant plan documents. Adoption of any of these
plans should be on the advice of your legal counsel or qualified tax adviser.

6.
Performance

Each Fund computes the average annual compounded rate of total return for each
Class during specified periods that would equate the initial amount invested to
the ending redeemable value of such investment by adding one to the computed
average annual total return, raising the sum to a power equal to the number of
years covered by the computation and multiplying the result by one thousand
dollars, which represents a hypothetical initial investment. The calculation
assumes deduction of the maximum sales charge (as described in the next
paragraph) from the amount invested and reinvestment of all income dividends and
capital gains distributions on the reinvestment dates at net asset value. The
ending redeemable value is determined by assuming a complete redemption at the
end of the period(s) covered by the average annual total return computation.

In calculating total returns for Class A shares, the current maximum sales
charge of 5.75% (as a percentage of the offering price) is deducted from the
initial investment (unless the return is shown at net asset value). For Class B
shares, the payment of the applicable CDSC (5.0% prior to the first anniversary
of purchase, 4.0% prior to the second anniversary of purchase, 3.0% prior to the
third and fourth anniversaries of purchase, 2.0% prior to the fifth anniversary
of purchase, 1.0% prior to the sixth anniversary of purchase and no CDSC on and
after the sixth anniversary of purchase) is applied to the Fund's investment
result for that Class for the time period shown (unless the total return is
shown at net asset value). For Class C shares, the 1.0% CDSC is applied to the
applicable Fund's investment result for that Class for the time period shown
prior to the first anniversary of purchase (unless the total return is shown at
net asset value). Total returns also assume that all dividends and capital gains
distributions during the period are reinvested at net asset value per share, and
that the investment is redeemed at the end of the period.

22
<PAGE>

Using the computation method described above the following table indicates the
average annual compounded rates of total return for each Fund, per Class, for
one, five, ten, or since inception where applicable. Past performance is not
indicative of future results.
<TABLE>
<CAPTION>
Since
1 Year 5 Year 10 Year Inception
------ ------ ------- ---------
<S> <C> <C> <C> <C>
Alpha Series
Class A shares 11.00% - - 3.27% (12/29/97)
Class B shares 12.12% - - 3.91% (12/29/97)
Class C shares 15.95% - - 5.96% (12/29/97)

Growth and Income Series
Class A shares 16.70% - - 20.62% (7/15/96)
Class B shares 18.17% - - 16.11% (6/5/97)
Class C shares 22.00% 20.29% 17.70% (1/3/94)

International Series
Class A shares 6.60% - - 12.54% (12/13/96)
Class B shares 7.31% - - 11.99% (6/2/97)
Class C shares 11.31% - - 13.04% (6/2/97)
Class P shares - - 9.53% (3/8/99)

World Bond-Debentures
Class A shares 1.30% - - 1.06% (12/18/97)
Class B shares 0.94% - - 1.22% (12/18/97)
Class C shares 4.55% - - 3.04% (12/18/97)
</TABLE>

Each Fund's yield quotation for each Class is based on a 30-day period ended on
a specified date, computed by dividing such Fund's net investment income per
share earned during the period by such Fund's maximum offering price per share
on the last day of the period. This is determined by finding the following
quotient: take the Class' dividends and interest earned during the period minus
its expenses accrued for the period and divide by the product of (i) the average
daily number of Class shares outstanding during the period that were entitled to
receive dividends and (ii) the Fund's maximum offering price per share on the
last day of the period. To this quotient add one. This sum is multiplied by
itself five times. Then one is subtracted from the product of this
multiplication and the remainder is multiplied by two. Yield for the Class A
shares reflects the deduction of the maximum initial sales charge, but may also
be shown based on the Fund's net asset value per share. Yields for Class B and
Class C shares do not reflect the deduction of the CDSC.

For the 30-day period ended October 31, 1999, the yield for the Growth & Income
Series' was 0% for Classes A, B, and C. For the 30-day period ended October 31,
1999, the yield for the International Series' was 0% for Classes A, B, C and P
shares. For the 30-day period ended October 31, 1999, the yield for the Alpha
Series' was 0% for Classes A, B, and C shares. For the 30-day period ended
October 31, 1999, the yield for the World Bond-Debenture Series' Class A, B, and
C shares were 7.46%, 7.16% and 7.16%, respectively.

These figures represent past performance, and an investor should be aware that
the investment return and principal value of a Fund investment will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than their
original cost. Therefore, there is no assurance that this performance will be
repeated in the future.

7.
Taxes

Each Fund intends to elect and to qualify for special tax treatment afforded
regulated investment companies under the Internal Revenue Code of 1986 (the
"Code"). If it so qualifies, each Fund (but not its shareholders) will be
relieved of federal income taxes on the amount it distributes to shareholders.
If in any taxable year the Funds do not qualify as a regulated investment
company, all of its taxable income will be taxed to the Fund at regular
corporate rates.

Each Fund contemplates declaring as dividends substantially all of its net
investment income. Dividends paid by the Fund from its investment income and
distributions of its net realized short-term capital gains are taxable to

23
<PAGE>

shareholders as ordinary income or capital gains, whether received in cash or
reinvested in additional shares of the Fund. The Fund will send each shareholder
annual information concerning the tax treatment of dividends and other
distributions.

Upon sale, exchange or redemption of shares of the Funds, a shareholder will
recognize short- or long-term capital gain or loss, depending upon the
shareholder's holding period in the Funds' shares. However, if a shareholder's
holding period in his shares is six month or less, any capital loss realized
from a sale or exchange of such shares must be treated as long-term capital loss
to the extent of dividends classified as "capital gains dividends" received with
respect to such shares. The maximum tax rates applicable to net capital gains
recognized by individuals and other non-corporate taxpayers are (i) the same as
ordinary income rates for capital assets held for one year or less and (ii) 20%
for capital assets held for more than one year. Capital gains or losses
recognized by corporate shareholders are subject to tax at the ordinary income
tax rates applicable to corporations.

Losses on the sale of shares are not deductible if, within a period beginning 30
days before the date of the sale and ending 30 days after the date of the sale,
the taxpayer acquires shares that are substantially identical.

Some shareholders may be subject to a 31% withholding tax on reportable
dividends, capital gains distributions and redemption payments ("backup
withholding"). Generally, shareholders subject to backup withholding will be
those for whom a certified taxpayer identification number is not on file with
the Fund or who, to the Fund's knowledge, have furnished an incorrect number.
When establishing an account, an investor must certify under penalties of
perjury that such number is correct and that he or she is not otherwise subject
to backup withholding.

The writing of call options and other investment techniques and practices which
the Funds may utilize may affect the character and timing of the recognition of
gains and losses. Such 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 be subject to foreign withholding taxes which would reduce the
yield on their investments. It is generally expected that Fund shareholders who
are subject to U.S. federal income tax will be entitled to claim a federal
income tax credit or deduction for foreign income taxes paid by the Fund.

The Funds will be subject to a 4% non-deductible excise tax on certain amounts
not distributed or treated as having been distributed on a timely basis each
calendar year. The Funds intend to distribute to shareholders each year an
amount adequate to avoid the imposition of such excise tax.

Dividends paid by the Funds will qualify for the dividends-received deduction
for corporations to the extent they are derived from dividends paid by domestic
corporations. Corporate shareholders must have held their shares in the Funds
for more than 45 days to qualify for the deduction on dividends paid by the
Funds.

Gain and loss realized by the Funds on certain transactions, including sales of
foreign debt securities and certain transactions involving foreign currency,
will be treated as ordinary income or loss for federal income tax purposes to
the extent, if any, that such gain or loss is attributable to changes in
exchange rates for foreign currencies. Accordingly, distributions taxable as
ordinary income will include the net amount, if any, of such foreign exchange
gains and will be reduced by the net amount, if any, of such foreign exchange
losses.

If the Funds purchase shares in certain foreign investment entities called
"passive foreign investment companies," they may be subject to U.S. federal
income tax on a portion of any "excess distribution" or gain from the
disposition of such shares, even if such income is distributed as a taxable
dividend by the Funds to their shareholders. Additional charges in the nature of
interest may be imposed on either the Funds' or their shareholders in respect of
deferred taxes arising from such distributions or gains. If the Funds were to
make a "qualified electing fund" election with respect to investment in a
passive foreign investment company, in lieu of the foregoing requirements, the
Funds might be required to include in income each year a portion of the ordinary
earnings and net capital gains of the qualified electing fund, even if such
amount were not distributed to the Funds.

The foregoing discussion relates solely to U.S. federal income tax law as
applicable to U.S. persons (U.S. citizens or residents and United States
domestic corporations, partnerships, trusts and estates.) Each shareholder who
is not a U.S. person should consult his tax adviser regarding the U.S. and
foreign tax consequences of the ownership of shares of the Funds, including the
applicable rate of U.S. withholding tax on dividends representing ordinary
income and net short-term capital gains, and the applicability of U.S. gift and
estate taxes.

24
<PAGE>

8.
Information About the Company

The Company was organized as a Delaware business trust on February 26, 1993.
Four of the portfolios, individually ("we" or the "Fund"), collectively (the
"Funds") are described in this Statement of Additional Information. All the
Funds have four classes of shares (A, B, C, and P), while International Series
has an additional class of shares, Class Y. Only Classes A, B, and C for the
Alpha Series, the Growth & Income Series, and the World Bond-Debenture Series,
and Classes A. B. C. and P of the International Series are offered by this
Statement of Additional Information. All shares have equal noncumulative voting
rights and equal rights with respect to dividends, assets and liquidation,
except for certain class-specific expenses. They are fully paid and
nonassessable when issued and have no preemptive or conversion rights.

Shareholder Liability. Delaware law provides that Company shareholders shall be
entitled to the same limitations of personal liability extended to stockholders
of private corporations for profit. The courts of some states, however, may
decline to apply Delaware law on this point. The Company's Declaration of Trust
contains an express disclaimer of shareholder liability for the acts,
obligations, or affairs of the Company and requires that a disclaimer be given
in each contract entered into or executed by the Company. The Declaration
provides for indemnification out of the Company's property of any shareholder or
former shareholder held personally liable for the obligations of the Company.
Thus, the risk of a shareholder incurring financial loss on account of
shareholder liability is limited to circumstances in which Delaware law does not
apply, no contractual limitation of liability was in effect and the portfolio is
unable to meet its obligations. Lord Abbett believes that, in view of the above,
the risk of personal liability to shareholders is extremely remote.

Under the Company's Declaration of Trust, the trustees may, without shareholder
vote, cause the Company to merge or consolidate into, or sell and convey all or
substantially all of, the assets of the Company to one or more trusts,
partnerships or corporations, so long as the surviving entity is an open-end
management investment company that will succeed to or assume the Company's
registration statement. In addition, the trustees may, without shareholder vote,
cause the Company to be incorporated under Delaware law.

Derivative actions on behalf of the Company may be brought only by shareholders
owning not less than 50% of the then outstanding shares of the Company.

The Company does not hold annual meetings of shareholders unless one or more
matters are required to be acted on by shareholders under the Act. Under the
Company's Declaration of Trust, shareholder meetings may be called at any time
by certain officers of the Company or by a majority of the trustees (i) for the
purpose of taking action upon any matter requiring the vote or authority of the
Company's shareholders or upon other matters deemed to be necessary or desirable
or (ii) upon the written request of the holders of at least one-quarter of the
shares of the Company's outstanding and entitled to vote at the meeting.

The directors, trustees and officers of Lord Abbett-sponsored mutual funds,
together with the partners and employees of Lord Abbett, are permitted to
purchase and sell securities for their personal investment account. In engaging
in personal securities transactions, however, such persons are subject to
requirements and restrictions contained in the Fund's Code of Ethics which
complies, in substance, with each of the recommendations of the Investment
Company Institute's Advisory Group on Personal Investing. Among other things,
the Code requires that Lord Abbett partners and employees obtain advance
approval before buying or selling securities, submit confirmations and quarterly
transaction reports, and obtain approval before becoming a director of any
company; and it prohibits such persons from investing in a security seven days
before or after any Lord Abbett-sponsored fund trades in such security,
profiting from trades of the same security within 60 days and trading on
material non-public information. The Code imposes similar requirements and
restrictions on the independent trustees of the Trust to the extent contemplated
by the recommendations of such Advisory Group.

25
<PAGE>

9.
Financial Statements

The financial statements for the fiscal year ended October 31, 1999 with respect
to the Alpha Series, Growth & Income Series, International Series, World
Bond-Debenture Series, and the report of Deloitte & Touche LLP, independent
auditors, on such financial statements contained in the 1999 Annual Report to
Shareholders of Lord Abbett Securities Trust, are incorporated herein by
reference to such financial statements and report in reliance upon the authority
of Deloitte & Touche LLP as experts in auditing and accounting.

<PAGE>

Lord Abbett

Micro-Cap Growth Fund
Micro-Cap Value Fund

Class Y Shares
Prospectus
March 1, 2000

Micro-Cap Growth Fund
Micro-Cap Value Fund

[LOGO]

As with all mutual funds, 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.

Class Y shares of the Fund are neither offered to the general public
nor are available in all states. Please call 800-821-5129 for further
information.

<PAGE>

Table of Contents

The Funds

Information about the goal/ Micro-Cap Growth Fund 2
principal strategy, main risks, Micro-Cap Value Fund 5
performance, and fees
and expenses

Your Investment

Information for managing Purchases 8
your Fund account Redemptions 9
Distributions and Taxes 9
Services For Fund Investors 10
Management 10

For More Information

How to learn more Other Investment Techniques 11
about the Funds Glossary of Shaded Terms 14

Financial Information

Financial highlights and line Micro-Cap Growth Fund 15
graph comparison Micro-Cap Value Fund 17

How to learn more about the Back Cover
Funds and other Lord Abbett Funds

<PAGE>

Micro-Cap Growth Fund

Goal / Principal Strategy

The Fund's investment objective is long-term capital appreciation.

To pursue this goal, the Fund normally invests at least 80% of its assets
in the stocks of companies with market capitalizations of less than $350
million at the time of purchase. We consider these companies to be
micro-cap companies. Micro-cap companies represent the smallest sector of
companies based on market capitalization. Normally, micro-cap companies are
in their earliest stages of development and may offer unique products,
services or technologies or may serve special or rapidly expanding niches.
The Fund may also invest up to 10% of its assets in foreign micro-cap
stocks.

We use fundamental analysis to look for micro-cap companies that appear to
have the potential for more rapid growth than the overall economy. The Fund
evaluates companies based on an analysis of their financial statements,
products and operations, market sectors and interviews with management.

This Fund is intended for investors who are willing to withstand the risk
of short-term price fluctuations in exchange for attractive potential
long-term returns.

We may take temporary defensive positions by investing some of our assets
in short-term debt securities. This could reduce the benefit from
any upswing in the market and prevent the Fund from achieving its
investment objective.

Main Risks

The Fund is subject to the general risks and considerations associated with
equity investing, as well as the particular risks associated with micro-cap
and growth stocks. The value of your investment will fluctuate in response
to movements in the stock market in general and to the changing prospects
of individual companies in which the Fund invests.

Stocks of the smaller companies in which the Fund invests may fluctuate in
price more than the price of larger company stocks. When small-cap
investing is out of favor, the Fund's share prices may decline even though
the companies the Fund holds have sound fundamentals. Micro-cap companies
may still be developing. They may have limited product lines or markets for
their products, limited access to financial resources and less depth in
management skill than larger companies. They also may be subject to greater
business risks and more sensitive to changes in economic conditions than
larger, more established companies.

Many micro-cap stocks are not traded in the volume typical of stocks listed
on a national securities exchange. As a result, they may be less liquid.
That means the Fund could have difficulty selling a micro-cap stock at an
acceptable price, especially in periods of market volatility. This could
increase the potential for loss to the Fund.

Growth stocks may grow faster than other stocks and may be more volatile.
In addition, if the Fund's assessment of a company's potential for growth
is wrong, the price of the company's stock may decrease below the price at
which the Fund purchased the stock.

Foreign securities may present increased market, liquidity, currency,
political, information and other risks.

We or the Growth Fund refers to the Micro-Cap Growth Fund of Lord Abbett
Securities Trust (the "Company"). The Growth Fund operates under the supervision
of the Company's Board with the advice of Lord, Abbett & Co.("Lord Abbett"), its
investment manager.

About the Fund. The Fund is a professionally managed portfolio of securities
purchased with the pooled money of investors. The Fund strives to reach its
stated goals, although as with all mutual funds, cannot guarantee results.

You should read this entire prospectus, including "Other Investment Techniques,"
which concisely describes the other investment strategies used by the Fund and
their risks.

2 The Funds

<PAGE>

Micro-Cap Growth Fund

Performance

The bar chart shows changes in the performance of the Fund's Class Y shares
from calendar year to calendar year.

- --------------------------------------------------------------------------------
Bar Chart (per calendar year) - Class Y Shares
- --------------------------------------------------------------------------------

[GRAPHIC OMITTED]
1999 - 51.2%

Best Quarter 4th Q `99 28.0% Worst Quarter 3rd Q `99 -4.3%
- --------------------------------------------------------------------------------

The table below shows how the average annual total returns of the Fund's
Class Y shares compared to those of a broad-based securities market index.

- --------------------------------------------------------------------------------
Average Annual Total Returns Through December 31, 1999

- --------------------------------------------------------------------------------
Share Class 1 Year Since Inception(1)

Class Y shares 51.23% 60.86%
- --------------------------------------------------------------------------------
Center for Research Security
Prices Index "CRSP 9-10 Index"(2) 37.16% 37.16%

(1) The date of inception for Class Y is 12/15/98.

(2) Performance for the unmanaged CRSP 9-10 Index does not reflect fees or
expenses. The performance of the index is not necessarily representative of
the Fund's performance.

The Funds 3

<PAGE>

Micro-Cap Growth Fund

Fees and expenses

This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.

- --------------------------------------------------------------------------------
Fee Table
- --------------------------------------------------------------------------------
Class Y

Shareholder Fees (Fees paid directly from your investment)
- --------------------------------------------------------------------------------
Maximum Sales Charge on Purchases (as a % of offering price) none
- --------------------------------------------------------------------------------
Maximum Deferred Sales Charge none Annual Fund Operating Expenses (Expenses
deducted from fund assets) (as a % of average net assets)
- --------------------------------------------------------------------------------
Management Fees (See "Management") 1.50%
Other Expenses 0.46%
Total Annual Fund Operating Expenses 1.96%
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
Example

- --------------------------------------------------------------------------------
This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. This Example, like that in
other funds' prospectuses, assumes that you invest $10,000 in the Fund for the
time periods indicated and then redeem all of your shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year
and that the Fund's operating expenses remain the same. Although your actual
costs may be higher or lower, based on these assumptions your costs would be:

Share Class 1 Year 3 Years 5 Years 10 Years

Class Y shares $199 $615 $1,057 $2,285
- --------------------------------------------------------------------------------

Management fees are payable to Lord Abbett for the Fund's investment management.

Other expenses include fees paid for miscellaneous items such as shareholder
service fees and professional fees.

Lord Abbett is currently waiving its management fees and subsiding the other
expenses of the Fund. Lord Abbett may stop waiving the management fees and
subsidizing the other expenses at any time. The total operationg expense ratio
with the fee waiver and expense subsidy is 0.00% of the average net assets.

4 The Funds

<PAGE>

Micro-Cap Value Fund

Goal / Principal Strategy

The Fund's investment objective is long-term capital appreciation.

We use fundamental analysis to look for micro-cap companies that appear to
be undervalued. The Fund considers a stock undervalued if, in our view, its
price does not reflect its potential worth. Because of their smaller size
and low level of trading, micro-cap stocks are often overlooked or not
closely followed by investors. The Fund will invest in companies that
appear to have good prospects for improvement in earnings trends, asset
values, or other positive attributes, which we believe to be important
factors in determining the future market valuation for the company's stock.
The Fund evaluates companies based on an analysis of their financial
statements, products and operations, market sectors and interviews with
management.

This Fund is intended for investors who are willing to withstand the risk
of short-term price fluctuations in exchange for attractive potential
long-term returns.

Main Risks

The Fund is subject to the general risks and considerations associated with
equity investing, as well as the particular risks associated with micro-cap
and value stocks. The value of your investment will fluctuate in response
to movements in the stock market in general and to the changing prospects
of individual companies in which the Fund invests.

There is also the risk that an investment may never reach what we think is
its full value.

Foreign securities may present increased market, liquidity, currency,
political, information and other risks.

We or the Value Fund refers to the Micro-Cap Value Fund of Lord Abbett
Securities Trust (the "Company"). The Value Fund operates under the supervision
of the Company's Board with the advice of Lord, Abbett & Co.("Lord Abbett"), its
investment manager.

You should read this entire prospectus, including "Other Investment Techniques,"
which concisely describes the other investment strategies used by the Fund and
their risks.

The Funds 5

<PAGE>

MICRO-CAP VALUE FUND

PERFORMANCE

The bar chart shows changes in the performance of the Fund's Class Y shares
from calendar year to calendar year.

- --------------------------------------------------------------------------------
BAR CHART (PER CALENDAR YEAR) - CLASS Y SHARES
- --------------------------------------------------------------------------------

[GRAPHIC OMITTED]

1999 - 20.1%

BEST QUARTER 2ND Q `99 21.2% WORST QUARTER 1ST Q `99 -7.3%

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

The table below shows how the average annual total returns of the Fund's
Class Y shares compared to those of a broad-based securities market index.

- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH DECEMBER 31, 1999
- --------------------------------------------------------------------------------

SHARE CLASS 1 YEAR SINCE INCEPTION(1)
Class Y shares 20.05% 22.18%
- --------------------------------------------------------------------------------
Center for Research Security
PRICES INDEX "CRSP 9-10 INDEX"(2) 37.16% 37.16%

(1) The date of inception for Class Y is12/15/98.

(2) Performance for the unmanaged CRSP 9-10 Index does not reflect fees or
expenses. The performance of the index is not necessarily representative of
the Fund's performance.

6 The Funds

<PAGE>

MICRO-CAP VALUE FUND

FEES AND EXPENSES

This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.

- --------------------------------------------------------------------------------
FEE TABLE
- --------------------------------------------------------------------------------
CLASS Y

Shareholder Fees (Fees paid directly from your investment)
- --------------------------------------------------------------------------------
Maximum Sales Charge on Purchases (as a % of offering price) none
- --------------------------------------------------------------------------------
Maximum Deferred Sales Charge none
Annual Fund Operating Expenses (Expenses
deducted from Fund assets) (as a % of average net assets)
- --------------------------------------------------------------------------------
Management Fees (See "Management") 1.50%
Other Expenses 0.56%
Total Annual Fund Operating Expenses 2.06%
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
EXAMPLE
- --------------------------------------------------------------------------------
This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. This Example, like that in
other funds' prospectuses, assumes that you invest $10,000 in the Fund for the
time periods indicated and then redeem all of your shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year
and that the Fund's operating expenses remain the same. Although your actual
costs may be higher or lower, based on these assumptions your costs would be:

SHARE CLASS 1 YEAR 3 YEARS 5 YEARS 10 YEARS

Class Y shares $209 $646 $1,108 $2,390
- --------------------------------------------------------------------------------

Management fees are payable to Lord Abbett for the Fund's investment management.

Other expenses include fees paid for miscellaneous items such as shareholder
service fees and professional fees.

Lord Abbett is currently waiving its management fees and sibsiding the
other expenses of the Fund. Lord Abbett may stop waiving the management fees and
subsidizing the other expenses at any time. The total operationg expense ratio
with the fee waiver and expense subsidy is 0.00% of the average net assets.

The Funds 7

<PAGE>

Your Investment

Purchases

Class Y shares. Class Y shares are purchased at net asset value ("NAV")
with no sales charge. The NAV of our shares is calculated every business
day as of the close of the New York Stock Exchange. Our shares are
continuously offered. The offering price is based on NAV per share next
determined after we receive your order submitted in proper form. We reserve
the right to withdraw all or part of the offering made by this prospectus,
or to reject any purchase order. We also reserve the right to waive or
change minimum investment requirements. All purchase orders are subject to
our acceptance and are not binding until confirmed or accepted in writing.

Who May Invest? Eligible purchasers of Class Y shares include: (1) certain
authorized brokers, dealers, registered investment advisers or other
financial institutions ("entities") who either (a) have an arrangement with
Lord Abbett Distributors in accordance with certain standards approved by
Lord Abbett Distributor, providing specifically for the use of our Class Y
shares, in particular investment products made available for a fee to
clients of such entities, or (b) charge an advisory, consulting or other
fee for their services and buy shares for their own accounts or the
accounts of their clients ("Mutual Fund Fee Based Programs"); (2) the
trustee or custodian under any deferred compensation or pension or
profit-sharing plan or payroll deduction IRA established for the benefit of
the employees of any company with an account(s) in excess of $10 million
managed by Lord Abbett or its sub-advisors on a private-advisory-account
basis; and (3) institutional investors, such as retirement plans,
companies, foundations, trusts, endowments and other entities where the
total amount of potential investable assets exceeds $50 million that were
not introduced to Lord Abbett by persons associated with a broker or dealer
primarily involved in the retail securities business. Additional payments
may be made by Lord Abbett out of its own resources with respect to certain
of these sales.

How Much Must You Invest? You may buy our shares through any independent
securities dealer having a sales agreement with Lord Abbett Distributor,
our exclusive selling agent. Place your order with your investment dealer
or send the money to the Fund you selected (P.O. Box 219100, Kansas City,
Missouri 64121). The minimum initial investment is $1 million except for
Mutual Fund Fee Based Programs, which have no minimum. This offering may
be suspended, changed or withdrawn by Lord Abbett Distributor which
reserves the right to reject any order.

Buying Shares Through Your Dealer. Orders for shares received by a Fund
prior to the close of the NYSE, or received by dealers prior to such close
and received by Lord Abbett Distributor prior to the close of its business
day, will be confirmed at NAV effective at such NYSE close. Orders received
by dealers after the NYSE closes and received by Lord Abbett Distributor in
proper form prior to the close of its next business day are executed at the
NAV effective as of the close of the NYSE on that next business day. The
dealer is responsible for the timely transmission of orders to Lord Abbett
Distributor. A business day is a day on which the NYSE is open for trading.

Buying Shares By Wire. To open an account, call 800-821-5129 Ext. 34028,
Institutional Trade Dept., to set up your account and to arrange a wire
transaction. Wire to: United Missouri Bank of Kansas City, N.A., Routing
number - 101000695, bank account number: 9878002611, FBO: (account name)
and (your Lord Abbett account number). Specify the complete name of the
Fund of your choice, note Class Y shares and include your new account
number and your name. To add to an existing account, wire to: United
Missouri Bank of Kansas City, N.A., routing number - 101000695, bank
account number: 9878002611, FBO: (account name) and (your Lord Abbett
account number). Specify the complete name of the Fund of your choice, note
Class Y shares and include your account number and your name.

NAV per share for each class of Fund shares is calculated each business day at
the close of regular trading on the New York Stock Exchange ("NYSE"), normally
4:00 p.m. Eastern time. Purchases and sales of Fund shares are executed at the
NAV next determined after the Fund receives your order in proper form. In
calculating NAV, securities for which market quotations are available are valued
at those quotations. Securities for which such quotations are not available are
valued at fair value under procedures approved by the Board of the Funds.

Lord Abbett Distributor LLC ("Lord Abbett Distributor") acts as agent for the
Fund to work with investment professionals that buy and/or sell shares of the
Fund on behalf of their clients. Generally, Lord Abbett Distributor does not
sell Fund shares directly to investors.

8 Your Investment

<PAGE>

REDEMPTIONS

By Broker. Call your investment professional for directions on how to
redeem your shares.

By Telephone. To obtain the proceeds of a redemption of $50,000 or less
from your account, you or your representative can call the Fund at
800-821-5129.

By Mail. Submit a written redemption request indicating, the name(s) in
which the account is registered, the Fund's name, the class of shares, your
account number, and the dollar value or number of shares you wish to sell.

Normally a check will be mailed to the name and address in which the
account is registered (or otherwise according to your instruction) within
three business days after receipt of your redemption request. Your account
balance must be sufficient to cover the amount being redeemed or your
redemption order will not be processed. Under unusual circumstances, the
Fund may suspend redemptions, or postpone payment for more than seven days,
as permitted by federal securities laws.

By Wire. In order to receive funds by wire, our servicing agent must have
the wiring instructions on file. To verify that this feature is in place,
call 800-821-5129 Ext. 34028, Institutional Trade Dept. minimum wire:
$1,000. Your wire redemption request must be received by your Fund before
the close of the NYSE for money to be wired on the next business day.

DISTRIBUTIONS AND TAXES

Each Fund normally pays its shareholders dividends from its net investment
income and distributes its net capital gains (if any) as "capital gains
distributions" on an annual basis. Your distributions will be reinvested in
your Fund in which you are invested, unless you instruct the Fund to pay
them to you in cash. There are no sales charges on reinvestments. The tax
status of distributions is the same for all shareholders regardless of how
long they have owned Fund shares or whether distributions are reinvested or
paid in cash.

Except in tax-advantaged accounts, any sale, redemption, or exchange of
Fund shares may be taxable to the shareholder.

Eligible Guarantor is any broker or bank that is a member of the Medallion Stamp
Program. Most major securities firms and banks are members of this program. A
notary public is not an Eligible Guarantor.

Your Investment 9

<PAGE>

SERVICES FOR FUND INVESTORS

AUTOMATIC SERVICES

We offer the following shareholder services:

Telephone Exchange Privilege. Class Y shares may be exchanged without a
service charge for Class Y shares of any Eligible Fund among the Lord
Abbett-sponsored Funds.

Account Statements. Every Lord Abbett investor automatically receives
quarterly account statements.

Account Changes. For any changes you need to make to your account, consult
your investment professional or call the Fund at 800-821-5129.

Systematic Exchange. You or your investment professional can establish a
schedule of exchanges between the same classes of any Eligible Fund.

MANAGEMENT

The Funds' investment adviser is Lord, Abbett & Co., located at 90 Hudson
St., Jersey City, NJ 07302-3973. Founded in 1929, Lord Abbett manages one
of the nation's oldest mutual fund complexes, with approximately $35
billion in more than 40 mutual fund portfolios and other advisory accounts.
For more information about the services Lord Abbett provides to the Funds,
see the Statement of Additional Information.

Lord Abbett is entitled to an annual management fee for each Fund, computed
and payable monthly, at a rate of 1.5% of each Fund's average daily net
assets. For the fiscal year ended October 31, 1999, Lord Abbett waived
its entire management fee and subsidized other expenses of each Fund. In
addition each Fund pays all expenses not expressly assumed by Lord Abbett.

Lord Abbett uses a team of portfolio managers and analysts acting together
to manage each Fund's investments.

Micro-Cap Growth Fund. Stephen J. McGruder, Partner of Lord Abbett, heads
the Fund's team, the other senior members of which are Lesley-Jane Dixon,
and Rayna Lesser. Mr. McGruder and Ms. Dixon have been with ord Abbett
since 1995, Ms. Lesser has been with Lord Abbett since 1996. Before joining
Lord Abbett, Mr. McGruder was a portfolio manager and Ms. Dixon was an
equity analyst with Wafra Investment Advisory Group. Ms.Lesser joined Lord
Abbett directly from Barnard College.

Micro-Cap Value Fund. Robert P. Fetch, Partner of Lord Abbett, heads the
Fund's team, the other senior members of which are Gregory M. Macosko and
Gerard S.E. Heffernan, Jr. Mr. Fetch joined Lord Abbett in 1995; before
that, he was was a Managing Director of Prudential Investment Advisors from
1983 to 1995. Mr. Macosko joined Lord Abbett in 1996; before that he was an
Equity Analyst with Quest Advisory Service from 1991 to 1996. Mr. Heffernan
joined Lord Abbett in 1998; before that he was with CL Capital Management
Company as a Portfolio Manager from 1996 to 1998 and as an Equity Research
Analyst from 1992 to 1996.

Telephone Transactions. You have this privilege unless you refuse it in writing.
For your security, telephone transaction requests are recorded. We will take
measures to verify the identity of the caller, such as asking for your name,
account number, social security or taxpayer identification number and other
relevant information. Each Fund will not be liable for following instructions
communicated by telephone that it reasonably believes to be genuine.
Transactions by telephone may be difficult to implement in times of drastic
economic or market change.

Exchange Limitations. Exchanges should not be used to try to take advantage of
short-term swings in the market. Frequent exchanges create higher expenses for
the Fund. Accordingly, the Fund reserves the right to limit or terminate this
privilege for any shareholder making frequent exchanges or abusing the
privilege. The Fund also may revoke the privilege for all shareholders upon 60
days' written notice.

10 Your Investment

<PAGE>

For More Information

OTHER INVESTMENT TECHNIQUES

This section describes some of the investment techniques that might be used
by the Funds and their risks.

Adjusting Investment Exposure. Each Fund may, but is not required to, use
various strategies to change its investment exposure to adjust to changing
security prices, interest rates, currency exchange rates, commodity prices
and other factors. Each Fund may use these transactions to change the risk
and return characteristics of each Fund's portfolio. If we judge market
conditions incorrectly or use a strategy that does not correlate well with
a Fund's investments, it could result in a loss, even if we intended to
lessen risk or enhance returns. These transactions may involve a small
investment of cash compared to the magnitude of the risk assumed and could
produce disproportionate gains or losses. Also, these strategies could
result in losses if the counterparty to a transaction does not perform as
promised.

Foreign Securities. Each Fund may invest up to 10% of its total assets in
foreign securities. Foreign securities may present risks not typically
associated with domestic securities. Foreign markets and the securities
traded in them are not subject to the same degree of regulation as U.S.
markets. Securities clearance and settlement procedures may be different in
foreign countries. There may be less trading volume in foreign markets,
subjecting the securities traded in them to higher price fluctuations.
Transaction costs may be higher in foreign markets. Each Fund may hold
foreign securities which trade on days when such Fund does not sell shares.
As a result, the value of each Fund's portfolio securities may change on
days an investor may not purchase or sell such Fund's shares.

Foreign issuers are generally not subject to similar, uniform accounting,
auditing and financial reporting requirements as U.S. issuers. Foreign
investments may be affected by changes in currency rates or currency
controls. Certain foreign countries may limit a Fund's ability to remove
its assets from the country. With respect to certain foreign countries,
there is a possibility of nationalization, expropriation or confiscatory
taxation, imposition of withholding or other taxes, and political or social
instability which could affect investments in those countries.

Foreign Currency Hedging Techniques. Both Funds may use foreign currency
hedging techniques. Although the Funds do not normally engage in extensive
currency hedging, they may use forward foreign currency contracts and
options thereon to hedge the risk to the portfolio if they expect that
foreign exchange price movements will be unfavorable for U.S. investors.
Generally, these instruments allow a Fund to lock in a specified ex-change
rate for a period of time. If our forecast proves to be wrong, such a hedge
may cause a loss. Also, it may be difficult or impractical to hedge
currency risk in many emerging countries. Although such contracts will be
used primarily to protect each Fund from adverse currency movements, their
use involves the risk that Lord Abbett will not accurately predict currency
movement, and each Fund's returns could be reduced.

In addition, forward foreign currency contracts and other privately
negotiated currency instruments offer less protection against defaults than
is available for currency instruments traded on an exchange. Since these
contracts are not guaranteed by an exchange or clearinghouse, a default on
a contract would deprive a Fund of unrealized profits, transaction costs,
or the benefits of a currency hedge, or could force a Fund to cover its
pur-

For More Information 11

<PAGE>

chase or sale commitments, if any, at the current market price. Currency
exchange rates may fluctuate significantly over short periods of time,
causing the NAV of each Fund to fluctuate. Currency exchange rates may be
affected unpredictably by the intervention of U.S. or foreign governments
or central banks, or the failure to intervene, or by currency controls or
political developments in the United States or abroad.

Each Fund may also purchase foreign currency put and call options, subject
to certain limitations.

There is the possibility that the foreign currency hedging techniques will
not work as anticipated.

Futures Contracts and Options on Future Contracts. Each Fund may enter into
financial futures transactions. A financial futures transaction is the
purchase or sale of an exchange-traded contract to buy or sell a specified
financial instrument or index at a specific future date and price. Neither
Fund will enter into any futures contracts, or options thereon, if the
aggregate market value of the securities covered by futures contracts plus
options on such financial futures exceeds 50% of such Fund's total assets.

Options Transactions. Each Fund may purchase and write put and call
options on equity securities or stock indices that are traded on national
securities exchanges.

A put option gives the buyer of the option the right to sell, and the
seller of the option the obligation to buy, the underlying instrument
during the option period.

A call option gives the buyer of the option the right to buy, and the
writer (seller) of the option the obligation to sell, the underlying
instrument. Each Fund may only sell (write) covered call options. This
means that each Fund may only sell call options on securities it owns.When
a Fund writes a call option it gives up the potential for gain on the
underlying securities in excess of the exercise price of the option during
the period that the option is open.

The Micro-Cap Growth Fund and Mirco-Cap Value Fund may write only covered
put options to the extent that cover for such options does not exceed 25%
of each Fund's net assets. Each Fund will not buy an option if, as a result
of such purchase, more than 20% of such Fund's total assets would be
invested in premiums for such options.

Repurchase Agreements. Each Fund may enter into repurchase agreements. In a
repurchase agreement, a Fund buys a security at one price from a
broker-dealer or financial institution and simultaneously agrees to sell
the same security back to the same party at a higher price in the future.
If the other party to the agreement defaults or becomes insolvent, a Fund
could lose money.

Risks of Futures Contracts and Options Transactions. The Fund's
transactions, if any, in futures, options on futures and other options
involve additional risk of loss. Loss may result from a lack of correlation
between changes in the value of these derivative instruments and the Funds'
assets being hedged, the potential illiquidity of the markets for
derivative instruments, or the risks arising from margin requirements and
related leverage factors associated with such transactions. The use of
these investment techniques also involves the risk of loss if the portfolio
managers are incorrect in their expectation of fluctuations in securities
prices. In addition, the loss that may be incurred by in entering into
futures contracts and in writing call options on futures is potentially
unlimited and may exceed the amount of the premium received.

Stock Index Futures. The Micro-Cap Value Fund may invest in stock index
futures. A stock index futures contract is an agreement in which one party
agrees to deliver to another an amount of cash equal to a specific dollar
amount times the difference between a spec-

12 For More Information

<PAGE>

ific stock index at the close of the last trading day of the contract and
the price at which the agreement is made. No physical delivery of the
underlying stocks in the index is made.

Participation in the stock index futures markets involves investment risks
and transaction costs to which the Micro-Cap Value Fund would not be
subject absent the use of these strategies. If the Micro-Cap Value Fund
management's prediction of movement in the direction of the securities
markets is inaccurate, the adverse consequences to the Fund may leave it in
a worse position than if such strategies were not used. Risks inherent in
the use of stock index futures include: (1) dependence on management's
ability to predict correctly movements in the direction of specific
securities being hedged or the movement in stock indices; (2) imperfect
correlation between the price of stock index futures and options thereon
and movements in the prices of the securities being hedged; (3) the fact
that skills needed to use these strategies are different from those needed
to select portfolio securities; (4) the possible absence of a liquid
secondary market for any particular instrument at any time; (5) the
possible need to defer closing out certain hedged positions to avoid
adverse tax consequences; and (6) daily limits on price variance for a
futures contract or related options imposed by certain futures exchanges
and boards of trade may restrict transactions in such securities on a
particular day.

The Micro-Cap Value Fund may not purchase or sell stock index futures if,
immediately after a purchase or sale, more than one-third of its net assets
would be hedged. In addition, except in the case of a call written and held
on the same index, the Micro-Cap Value Fund will write call options on
indices or sell stock index futures only if the amount resulting from the
multiplication of the then current level of the index (or indices) upon
which the options or futures contract(s) is based, the applicable
multiplier(s), and the number of futures or options contracts which would
be outstanding would not exceed one-third of the value of the Micro-Cap
Value Fund's net assets.

The Micro-Cap Value Fund's ability to enter into stock index futures and
listed options is limited by certain tax requirements in order to qualify
as a regulated investment company.

When-Issued or Delayed Delivery Securities. The Micro-Cap Value Fund may
purchase or sell securities with payment and delivery taking place as much
as a month or more later. The Fund would do this in an effort to buy or
sell the securities at an advantageous price and yield. The securities
involved are subject to market fluctuation and no interest accrues to the
purchaser during the period between purchase and settlement.
At the time of delivery of the securities, their market value may be less
than the purchase price. Also, if the Fund commits a significant amount of
assets to when-issued or delayed delivery transactions, it may increase the
volatility of its net asset value.

For More Information 13

<PAGE>

GLOSSARY OF SHADED TERMS

Eligible Fund. An Eligible Fund is any Lord Abbett-sponsored fund offering
class Y shares.

Legal Capacity. This term refers to the authority of an individual to act
on behalf of an entity or other person(s). For example, if a redemption
request were to be made on behalf of the estate of a deceased shareholder,
John W. Doe, by a person (Robert A. Doe) who has the legal capacity to act
for the estate of the deceased shareholder because he is the executor of
the estate, then the request must be executed as follows: Robert A. Doe,
Executor of the Estate of John W. Doe. That signature using that capacity
must be by an Eligible Guarantor.

GUARANTEED SIGNATURE. An acceptable form of guarantee would be as follows:

In the case of the estate --

Robert A. Doe
Executor of the Estate of
John W. Doe

[Date]

SIGNATURE GUARANTEED
MEDALLION GUARANTEED
NAME OF GUARANTOR

[SIGNATURE ILLEGIBLE]
- --------------------------------------------------
AUTHORIZED SIGNATURE
(960) X 9 6 0 3 4 7 0
SECURITIES TRANSFER AGENTS MEDALLION PROGRAM'sm'
SR

In the case of the corporation --
ABC Corporation

Mary B. Doe
\ By Mary B. Doe, President

[Date]

SIGNATURE GUARANTEED
MEDALLION GUARANTEED
NAME OF GUARANTOR

[SIGNATURE ILLEGIBLE]
- --------------------------------------------------
AUTHORIZED SIGNATURE
(960) X 9 6 0 3 4 7 0
SECURITIES TRANSFER AGENTS MEDALLION PROGRAM'sm'
SR

To give another example, if a redemption request were to be made on behalf
of the ABC Corporation by a person (Mary B. Doe) who has the legal capacity
to act on behalf of the Corporation, because she is the president of the
corporation, the request must be executed as follows: ABC Corporation by
Mary B. Doe, President. That signature using that capacity must be
guaranteed by an Eligible Guarantor (see example in right column).

Mutual Fund Fee Based Program. Certain unaffiliated authorized brokers,
dealers, registered investment advisers or other financial institutions
("entities") who either (1) have an arrangement with Lord Abbett
Distributor, providing specifically for the use of our shares (and
sometimes providing for acceptance of orders for such shares on our behalf)
in particular investment products made available for a fee to clients of
such entities, or (2) charge an advisory, consulting or other fee for their
services and buy shares for their own accounts or the accounts of their
clients.

14 For More Information

<PAGE>

Micro-Cap Growth Fund

FINANCIAL INFORMATION

FINANCIAL HIGHLIGHTS
This table describes the Fund's performance for the fiscal period
indicated. "Total return" shows how much your investment in the Fund would
have increased (or decreased) during each period, assuming you had
reinvested all dividends and distributions. These Financial Highlights have
been audited by Deloitte & Touche LLP, the Fund's independent auditors, in
conjunction with their annual audit of the Fund's financial statements.
Financial statements for the fiscal year ended October 31, 1999 and the
Independent Auditors' Report thereon appear in the Annual Report to
Shareholders for the fiscal year ended October 31, 1999 and are
incorporated by reference into the Statement of Additional Information,
which is available upon request. Certain information reflects financial
results for a single Fund share.

- --------------------------------------------------------------------------------
Class Y Shares
- --------------------------------------------------------------------------------
Year Ended October 31,
Per Share Operating Performance: 1999
Net asset value, beginning of period(a) $10.00
- --------------------------------------------------------------------------------
Income from investment operations
Net investment income(b) .02
Net realized and unrealized gain on investments 2.55
Total from investment operations 2.57
Net asset value, end of period $12.57
Total Return(c) 25.70%
Ratios to Average Net Assets:(c)
Expenses, including waiver --
- --------------------------------------------------------------------------------
Expenses, excluding waiver 1.71%
- --------------------------------------------------------------------------------
Net investment income .19%
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
Year Ended October 31,
- --------------------------------------------------------------------------------
Supplemental Data For All Classes: 1999
Net assets, end of period (000) $1,404
- --------------------------------------------------------------------------------
Portfolio turnover rate 41.18%
- --------------------------------------------------------------------------------

(a) Commencement of operations for class of shares: December 15, 1998.
(b) Calculated using average shares outstanding during the period.
(c) Not annualized.

Financial Information 15

<PAGE>

Micro-Cap Growth Fund

Line Graph Comparison

Immediately below is a comparison of a $10,000 investment in Class Y shares
to the same investment in the Center for Research Security Prices Index
"CRSP 9-10 Index", assuming reinvestment of all dividends and
distributions.

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

[GRAPHIC OMITTED]

NAV CRSP 9-10
12/15/98 10000
12/31/98 10870 10000
01/31/99 12460 10594
02/28/99 11180 9899
03/31/99 10840 9689
04/30/99 11560 10509
05/31/99 12080 10831
06/30/99 13420 11251
07/31/99 13650 11437
08/31/99 12760 11159
09/30/99 12840 11058
10/31/99 12570 11000
- --------------------------------------------------------------------------------
Average Annual Total Return At Maximum Applicable
Sales Charge For The Periods Ending October 31, 1999

Life/2
- --------------------------------------------------------------------------------
Class Y 25.70%
- --------------------------------------------------------------------------------

(1) Performance for the unmanaged CRSP 9-10 Index does not reflect fees or
expenses. The performance of the index is not necessarily representative of the
Fund's performance. Performance for the index begins on December 31, 1998.

(2) The inception date for Class Y is 12/15/98.

16 Financial Information

<PAGE>

Micro-Cap Value Fund

FINANCIAL HIGHLIGHTS

This table describes the Fund's performance for the fiscal period
indicated. "Total return" shows how much your investment in the Fund would
have increased (or decreased) during each period, assuming you had
reinvested all dividends and distributions. These Financial Highlights have
been audited by Deloitte & Touche LLP, the Fund's independent auditors, in
conjunction with their annual audit of the Fund's financial statements.
Financial statements for the fiscal year ended October 31, 1999 and the
Independent Auditors' Report thereon appear in the Annual Report to
Shareholders for the fiscal year ended October 31, 1999 and are
incorporated by reference into the Statement of Additional Information,
which is available upon request. Certain information reflects financial
results for a single Fund share.

- --------------------------------------------------------------------------------
Class Y Shares
- --------------------------------------------------------------------------------
Year Ended October 31,
Per Share Operating Performance: 1999
Net asset value, beginning of period(a) $10.00
- --------------------------------------------------------------------------------
Income from investment operations
Net investment income(b) .12
Net realized and unrealized gain on investments .63
Total from investment operations .75
Net asset value, end of period $10.75
Total Return(c) 7.60%
Ratios to Average Net Assets:(c)
Expenses, including waiver --
- --------------------------------------------------------------------------------
Expenses, excluding waiver 1.80%
- --------------------------------------------------------------------------------
Net investment income 1.08%
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
Year Ended October 31,
- --------------------------------------------------------------------------------
Supplemental Data For All Classes: 1999
Net assets, end of period (000) $1,152
- --------------------------------------------------------------------------------
Portfolio turnover rate 30.38%
- --------------------------------------------------------------------------------

(a) Commencement of operations for class of shares: December 15, 1998.
(b) Calculated using average shares outstanding during the period.
(c) Not annualized.

Financial Information 17

<PAGE>

Micro-Cap Value Fund

Line Graph Comparison

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

[GRAPHIC OMITTED]

NAV CRSP 9-10
12/15/98 10000
12/31/98 10270 10000
01/31/99 10390 10594
02/28/99 9750 9899
03/31/99 9520 9689
04/30/99 10530 10509
05/31/99 10950 10831
06/30/99 11540 11251
07/31/99 11550 11437
08/31/99 11290 11159
09/30/99 11050 11058
10/31/99 10760 11000

- --------------------------------------------------------------------------------
Average Annual Total Return At Maximum Applicable
Sales Charge For The Periods Ending October 31, 1999

Life/2
- --------------------------------------------------------------------------------
Class Y 7.60%
- --------------------------------------------------------------------------------

(1) Performance for the unmanaged CRSP 9-10 Index does not reflect any expenses.
The performance of the index is not necessarily representative of the Fund's
performance. Performance for the index begins on December 31, 1998.
(2) The inception date for Class Y is 12/15/98.

18 Financial Information

<PAGE>

More information on these Funds is available free upon request, including
the following:

ANNUAL/SEMI-ANNUAL REPORT

Describes the Fundd, lists portfolio holdings and contains a letter from
each Fund's manager discussing recent market conditions and each Fund's
investment strategies.

STATEMENT OF ADDITIONAL INFORMATION ("SAI")

Provides more details about the Fund and their policies. A current SAI is
on file with the Securities and Exchange Commission ("SEC") and is
incorporated by reference (is legally considered part of this prospectus).

Lord Abbett Micro-Cap Growth Fund
Lord Abbett Micro-Cap Value Fund

90 Hudson Street
Jersey City, NJ 07302-3973
--------------------------
SEC file number: 811-7358

To obtain information:

By telephone. Call the Funds at:
800-426-1130

By mail. Write to the Funds at:
The Lord Abbett Family of Funds
90 Hudson Street
Jersey City, NJ 07302-3973

Via the Internet.
Lord, Abbett & Co.
www.lordabbett.com

Text only versions of Fund
documents can be viewed
online or downloaded from:
SEC
www.sec.gov

LAMC-Y-1-300
(3/00)

<PAGE>

LORD ABBETT

Statement of Additional Information March 1, 2000

LORD ABBETT SECURITIES TRUST
Lord Abbett Micro-Cap Growth Fund
Lord Abbett Micro-Cap Value Fund

This Statement of Additional Information is not a Prospectus. A Prospectus may
be obtained from your securities dealer or from Lord Abbett Distributor LLC
("Lord Abbett Distributor") at 90 Hudson Street, Jersey City, New Jersey
07302-3973. This Statement of Additional Information relates to, and should be
read in conjunction with, the Prospectus dated March 1, 2000.

Shareholder inquiries should be made by contacting the Funds directly or by
calling 800-821-5129. The Annual Report to Shareholders is available without
charge, upon request by calling that number. In addition, you can make inquiries
through your dealer.

TABLE OF CONTENTS PAGE

1. Investment Policies 2
2. Trustees and Officers 11
3. Investment Advisory and Other Services 15
4. Portfolio Transactions 16
5. Purchases, Redemptions
and Shareholder Services 17
6. Performance 18
7. Taxes 19
8. Information About The Company 20
9. Financial Statements 20

<PAGE>

Lord Abbett Securities Trust (the "Company" or the "Funds") was organized
as a Delaware business trust on February 26, 1993, as a diversified open-end
management investment company registered under the Investment Company Act of
1940, as amended (the "Act"). The Company has six funds, but only Class Y shares
of Lord Abbett Micro-Cap Growth Fund and Lord Abbett Micro-Cap Value Fund are
described in this Statement of Additional Information. All shares have equal
noncumulative voting rights and equal rights with respect to dividends, assets
and liquidation, except for certain class-specific expenses. They are fully paid
and nonassessable when issued and have no preemptive or conversion rights.

1.
Investment Policies

Each Fund may not:

(1) borrow money, except that (i) each Fund may borrow from banks (as
defined in the Act) in amounts up to 33 1/3% of its total assets
(including the amount borrowed), (ii) each Fund may borrow up to an
additional 5% of its total assets for temporary purposes, (iii) each
Fund may obtain such short-term credit as may be necessary for the
clearance of purchases and sales of portfolio securities and (iv)
each Fund may purchase securities on margin to the extent permitted
by applicable law;

(2) pledge its assets (other than to secure borrowings, or to the extent
permitted by the Funds' investment policies as permitted by applicable
law);

(4) make loans to other persons, except that the acquisition of bonds,
debentures or other corporate debt securities and investment in
government obligations, commercial paper, pass-through instruments,
certificates of deposit, bankers acceptances, repurchase agreements
or any similar instruments shall not be subject to this limitation,
and except further that each Fund may lend its portfolio securities,
provided that the lending of portfolio securities may be made only in
accordance with applicable law;

(5) buy or sell real estate (except that each Fund may invest in
securities directly or indirectly secured by real estate or interests
therein or issued by companies which invest in real estate or
interests therein) or commodities or commodity contracts (except to
the extent each Fund may do so in accordance with applicable law and
without registering as a commodity pool operator under the Commodity
Exchange Act as, for example, with futures contracts);

(6) with respect to 75% of the gross assets of each Fund, buy securities
of one issuer representing more than (i) 5% of each Fund's gross
assets, except securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities or (ii) own more than
10% of the voting securities of such issuer;

(8) issue senior securities to the extent such issuance would violate
applicable law.

Compliance with the investment restrictions in this Section 1 will be determined
at the time of purchase or sale of the portfolio investments.

<PAGE>

Non-Fundamental Investment Restrictions. In addition to policies in the
Prospectus and the investment restrictions above which cannot be changed without
shareholder approval, each Fund is also subject to the following non-fundamental
investment policies which may be changed by the Board of Directors without
shareholder approval.

Each Fund may not:

(1) borrow in excess of 33 1/3% of its total assets (including the amount
borrowed), and then only as a temporary measure for extraordinary or
emergency purposes;

(2) make short sales of securities or maintain a short position except to
the extent permitted by applicable law;

(4) invest in the securities of other investment companies as defined in
the Act, except as permitted by applicable law;

(5) invest in securities of issuers which, with their predecessors, have a
record of less than three years' continuous operation, if more than 5%
of each Fund's total assets would be invested in such securities (this
restriction shall not apply to mortgaged-backed securities,
asset-backed securities or obligations issued or guaranteed by the U.
S. Government, its agencies or instrumentalities);

(6) hold securities of any issuer if more than 1/2 of 1% of the securities
of such issuer are owned beneficially by one or more of the officers
or directors/trustees of the Funds or by one or more of its partners
or members or underwriter or investment adviser if these owners in the
aggregate own beneficially more than 5% of the securities of such
issuer;

(7) invest in warrants if, at the time of the acquisition, its investment
in warrants, valued at the lower of cost or market, would exceed 5% of
each Fund's total assets (included within such limitation, but not to
exceed 2% of each Fund's total assets, are warrants which are not
listed on the New York or American Stock Exchange or a major foreign
exchange);

(8) invest in real estate limited partnership interests or interests in
oil, gas or other mineral leases, or exploration or development
programs, except that each Fund may invest in securities issued by
companies that engage in oil, gas or other mineral exploration or
development activities;

(9) write, purchase or sell puts, calls, straddles, spreads or
combinations thereof, except to the extent permitted in the Funds'
Prospectuses and statements of additional information, as they may be
amended from time to time; or

(10) buy from or sell to any of the Funds' officers, directors, employees,
or its investment adviser or any of the Funds' officers, directors,
trustees, partners or employees, any securities other than its shares.

<PAGE>

INVESTMENT TECHNIQUES

Borrowing. Each Fund may borrow from banks. If a Fund borrows money, its share
price may be subject to greater fluctuation until the borrowing is paid off.
Each Fund may borrow only for temporary or emergency purposes, and not in an
amount exceeding 33 1/3% of its total assets.

Call Options On Stock. Each Fund may, from time to time, write call options on
its portfolio securities. Each Fund may write only call options which are
"covered," meaning that the Fund either owns the underlying security or has an
absolute and immediate right to acquire that security, without additional cash
consideration, upon conversion or exchange of other securities currently held in
its portfolio. In addition, the Fund will not permit the call to become
uncovered prior to the expiration of the option or termination through a closing
purchase transaction as described below. If the Fund writes a call option, the
purchaser of the option has the right to buy (and the Fund has the obligation to
sell) the underlying security at the exercise price throughout the term of the
option. The amount paid to the Fund by the purchaser of the option is the
"premium." The Funds' obligation to deliver the underlying security against
payment of the exercise price would terminate either upon expiration of the
option or earlier if the Fund' were to effect a "closing purchase transaction"
through the purchase of an equivalent option on an exchange. There can be no
assurance that a closing purchase transaction can be effected. The Fund does not
intend to write covered call options with respect to securities with an
aggregate market value of more than 5% of it's gross assets at the time an
option is written. This percentage limitation will not be increased without
prior disclosure in our current prospectus.

The Fund would not be able to effect a closing purchase transaction after it had
received notice of exercise. In order to write a call option, the Fund is
required to comply with the rules of The Options Clearing Corporation and the
various exchanges with respect to collateral requirements. The Fund may not
purchase call options except in connection with a closing purchase transaction.
It is possible that the cost of effecting a closing purchase transaction may be
greater than the premium received by the Fund for writing the option.

Generally, the Fund intends to write listed covered call options during periods
when it anticipates declines in the market values of portfolio securities
because the premiums received may offset to some extent the decline in the
Fund's net asset value occasioned by such declines in market value. Except as
part of the "sell discipline" described below, the Fund will generally not write
listed covered call options when it anticipates that the market values of it's
portfolio securities will increase.

One reason for the Fund to write call options is as part of a "sell discipline."
If the Fund decides that a portfolio security would be overvalued and should be
sold at a certain price higher than the current price, it could write an option
on the stock at the higher price. Should the stock subsequently reach that price
and the option be exercised, the Fund would, in effect, have increased the
selling price of that stock, which it would have sold at that price in any
event, by the amount of the premium. In the event the market price of the stock
declined and the option were not exercised, the premium would offset all or some
portion of the decline. It is possible that the price of the stock could
increase beyond the exercise price; in that event, the Fund would forego the
opportunity to sell the stock at that higher price.

In addition, call options may be used as part of a different strategy in
connection with sales of portfolio securities. If, in the judgment of Fund
Management, the market price of a stock is overvalued and it should be sold, the
Fund may elect to write a call option with an exercise price substantially below
the current market price. As long as the value of the underlying security
remains above the exercise price during the term of the option, the option will,
in all probability, be exercised, in which case the Fund will be required to
sell the stock at the exercise price. If the sum of the premium and the exercise
price exceeds the market price of the stock at the time the call option is
written, the Fund would, in effect, have increased the selling price of the
stock. The Fund would not write a call option in these circumstances if the sum
of the premium and the exercise price were less than the current market price of
the stock.

Closed-End Investment Companies. The Micro-Cap Value Fund may invest in shares
of closed-end investment companies if it pays a fee or commission no greater
than the customary broker's commission. Shares of investment companies sometimes
trade at a discount or premium to their net asset value. Also, there may be
duplication of fees if the Fund and the closed-end investment company both
charge a management fee. No more than 5% of the Fund's gross assets may be
invested in Closed-End Investment Companies.

<PAGE>

Covered Call Options. Each Fund may write covered call options, which are traded
on a national securities exchange with respect to securities in its portfolio in
an attempt to increase its income and to provide greater flexibility in the
disposition of its portfolio securities. A "call option" is a contract sold for
a price (the "premium") giving its holder the right to buy a specific number of
shares of a stock at a specific price prior to a specified date. A "covered call
option" is a call option issued on securities already owned by the writer of the
call option for delivery to the holder upon the exercise of the option. During
the period of the option, each Fund forgoes the opportunity to profit from any
increase in the market price of the underlying security above the exercise price
of the option (to the extent that the increase exceeds its net premium). Each
Fund may enter into "closing purchase transactions" in order to terminate its
obligation to deliver the underlying security (this may result in a short-term
gain or loss). A closing purchase transaction is the purchase of a call option
(at a cost which may be more or less than the premium received for writing the
original call option) on the same security with the same exercise price and call
period as the option previously written. If a Fund is unable to enter into a
closing purchase transaction, it may be required to hold a security that it
might otherwise have sold to protect against depreciation. Each Fund does not
intend to write covered call options with respect to securities with an
aggregate market value of more than 5% of it's gross assets at the time an
option is written. This percentage limitation will not be increased without
prior disclosure in the current Prospectus.

Diversification. Each Fund is a diversified fund, which means that with respect
to 75% of its total assets, it will not purchase a security if, as a result,
more than 5% of the Fund's total assets would be invested in securities of a
single issuer or the Fund would hold more than 10% of the outstanding voting
securities of the issuer. U. S. government securities are not subject to these
requirements.

Financial Futures Contracts. Each Fund may enter into contracts for the future
delivery of a financial instrument, such as a security or the cash value of a
securities index. This investment technique is designed primarily to hedge
(i.e., protect) against anticipated future changes in interest rates or market
conditions which otherwise might adversely affect the value of securities which
we hold or intend to purchase. A "sale" of a futures contract means the
undertaking of a contractual obligation to deliver the securities or the cash
value of an index called for by the contract at a specified price during a
specified delivery period. A "purchase" of a futures contract means the
undertaking of a contractual obligation to acquire the securities or cash value
of an index at a specified price during a specified delivery period. At the time
of delivery pursuant to the contract, adjustments are made to recognize
differences in value arising from the delivery of securities that differ from
those specified in the contract. In some cases, securities called for by a
futures contract may not have been issued at the time the contract was written.
Each Fund will not enter into any futures contracts or options on futures
contracts if the aggregate of the market value of the securities covered by it's
outstanding futures contracts and securities covered by futures contracts
subject to the outstanding options written by us would exceed 50% of its total
assets.

Although some financial futures contracts by their terms call for the actual
delivery or acquisition of securities, in most cases, a party will close out the
contractual commitment before delivery without having to make or take delivery
of the security by purchasing (or selling, as the case may be) on a commodities
exchange an identical futures contract calling for delivery in the same month.
Such a transaction, if effected through a member of an exchange, cancels the
obligation to make or take delivery of the securities. All transactions in the
futures market are made, offset or fulfilled through a clearing house associated
with the exchange on which the contracts are traded. Each Fund will incur
brokerage fees when they purchase or sell contracts and will be required to
maintain margin deposits. At the time they enter into a futures contract, a Fund
is required to deposit with the custodian, on behalf of the broker, a specified
amount of cash or eligible securities called "initial margin." The initial
margin required for a futures contract is set by the exchange on which the
contract is traded. Subsequent payments, called "variation margin," to and from
the broker are made on a daily basis as the market price of the futures contract
fluctuates. The costs incurred in connection with futures transactions could
reduce the Fund's return. Futures contracts entail risks. If the investment
adviser's judgment about the general direction of interest rates or markets is
wrong, the overall performance may be poorer than if no such contracts had been
entered into.

<PAGE>

Foreign Currency Hedging Techniques. Each Fund may utilize various foreign
currency hedging techniques described below, including forward foreign currency
contracts and foreign currency put and call options.

Foreign Currency Put And Call Options. Each Fund also may purchase foreign
currency put options and write foreign currency call options on U.S. exchanges
or U.S. over-the-counter markets. A put option gives a Fund, upon payment of a
premium, the right to sell a currency at the exercise price until the expiration
of the option and serves to insure against adverse currency price movements in
the underlying portfolio assets denominated in that currency.

Exchange-listed options markets in the United States include several major
currencies, and trading may be thin and illiquid. A number of major investment
firms trade unlisted options which are more flexible than exchange-listed
options with respect to strike price and maturity date. Unlisted options
generally are available in a wider range of currencies. Unlisted foreign
currency options are generally less liquid than listed options and involve the
credit risk associated with the individual issuer. The premiums paid for such
currency put options will not exceed 5% of the net assets of a Fund. Unlisted
options, together with other illiquid securities, are subject to a limit of 15%
of a Fund's net assets. The face value of such currency call option writing or
cross-hedging may not exceed 90% of the value of the securities denominated in
such currency invested in to cover such call writing or to be crossed.

A call option written by each Fund gives the purchaser, upon payment of a
premium, the right to purchase from the Fund a currency at the exercise price
until the expiration of the option. Each Fund may write a call option on a
foreign currency only in conjunction with a purchase of a put option on that
currency. Such a strategy is designed to reduce the cost of downside currency
protection by limiting currency appreciation potential. The face value of such
writing may not exceed 90% of the value of the securities denominated in such
currency invested in by the Fund or in such cross currency (referred to above)
to cover such call writing.

Each Fund's custodian will segregate cash or permitted securities belonging to
the Fund in an amount not less than that required by SEC Release 10666 and
related policies with respect to the Fund's assets committed to (a) writing
options, (b) forward foreign currency contracts and (c) cross hedges entered
into by the Fund. If the value of the securities segregated declines, additional
cash or debt securities will be added on a daily basis (i.e., marked to market),
so that the segregated amount will not be less than the amount of the Fund's
commitments with respect to such written options, forward foreign currency
contracts and cross hedges.

Forward Foreign Currency Contracts. A forward foreign currency contract involves
an obligation to purchase or sell a specific amount of a specific currency at a
set price at a future date. A Fund expects to enter into forward foreign
currency contracts in primarily two circumstances. First, when a Fund enters
into a contract for the purchase or sale of a security denominated in a foreign
currency, it may desire to "lock in" the U.S. dollar price of the security. By
entering into a forward contract for the purchase or sale of the amount of
foreign currency involved in the underlying security transaction, a Fund will be
able to protect against a possible loss resulting from an adverse change in the
relationship between the U.S. dollar and the subject foreign currency during the
period between the date the security is purchased or sold and the date on which
payment is made or received.

Second, when management believes that the currency of a particular foreign
country may suffer a decline against the U.S. dollar, each Fund may enter into a
forward contract to sell the amount of foreign currency approximating the value
of some or all of the Fund's portfolio securities denominated in such foreign
currency or, in the alternative, the Fund may use a cross-hedging technique
whereby it sells another currency which the Fund expects to decline in a similar
way but which has a lower transaction cost. Precise matching of the forward
contract amount and the value of the securities involved will not generally be
possible since the future value of such securities denominated in foreign
currencies will change as a consequence of market movements in the value of
those securities between the date the forward contract is entered into and the
date it matures. Each Fund does not intend to enter into such forward contracts
under this second circumstance on a continuous basis.

<PAGE>

Illiquid Securities. Each Fund may invest in illiquid securities. These
securities include those that are not traded on the open market or that trade
irregularly or in very low volume. They may be difficult or impossible to sell
at the time and price the Fund would like. Each Fund may invest up to 15% of its
assets in illiquid securities. Some securities of micro-cap companies may be
restricted as to resale or may be highly illiquid.

Limitations On The Purchases And Sales Of Stock Options, Options On Stock
Indices And Stock Index Futures. Each Fund may write put and call options on
stocks only if they are covered, and such options must remain covered so long as
the Fund is obligated as a writer. Each Fund will not (a) write puts having an
aggregate exercise price greater than 25% of its total net assets; or (b)
purchase (i) put options on stocks not held in the Fund's portfolio, (ii) put
options on stock indices or (iii) call options on stocks or stock indices if,
after any such purchase, the aggregate premiums paid for such options would
exceed 20% of the Fund's total net assets.

Options And Financial Futures Transactions. Each Fund may engage in options and
financial futures transactions in accordance with their investment objective and
policies. Although each Fund is not currently employing such options and
financial futures transactions, they may engage in such transactions in the
future if it appears advantageous to us to do so, in order to cushion the
effects of fluctuating interest rates and adverse market conditions. The use of
options and financial futures, and possible benefits and attendant risks, are
discussed below, along with information concerning certain other investment
policies and techniques.

Options On Financial Futures Contracts. Each Fund may purchase and write call
and put options on financial futures contracts. An option on a futures contract
gives the purchaser the right, in return for the premium paid, to assume a
position in a futures contract at a specified exercise price at any time during
the period of the option. Upon exercise, the writer of the option delivers the
futures contract to the holder at the exercise price. Each Fund would be
required to deposit with our custodian initial margin and maintenance margin
with respect to put and call options on futures contracts written by us. Options
on futures contracts involve risks similar to the risks relating to transactions
in financial futures contracts described above. Generally speaking, a given
dollar amount used to purchase an option on a financial futures contract can
hedge a much greater value of underlying securities than if that amount were
used to directly purchase the same financial futures. Should the event that the
Fund intends to hedge (or protect) against not materialize, however, the option
may expire worthless, in which case the Fund would lose the premium paid
therefor.

<PAGE>

Put Options On Stock. Each Fund may also write listed put options. If the Fund
writes a put option, it is obligated to purchase a given security at a specified
price at any time during the term of the option.

Writing listed put options is a useful portfolio investment strategy when the
Fund has cash or other reserves available for investment as a result of sales of
Fund shares or, more importantly, because Fund management believes a more
defensive and less fully invested position is desirable in light of market
conditions. If Fund management wishes to invest its cash or reserves in a
particular security at a price lower than current market value, it may write a
put option on that security at an exercise price which reflects the lower price
it is willing to pay. The buyer of the put option generally will not exercise
the option unless the market price of the underlying security declines to a
price near or below the exercise price. If the Fund writes a listed put, the
price of the underlying stock declines and the option is exercised, the premium,
net of transaction charges, will reduce the purchase price paid by the Fund for
the stock. The price of the stock may decline by an amount in excess of the
premium, in which event the Fund would have foregone an opportunity to purchase
the stock at a lower price.

If, prior to the exercise of a put option, the Fund determines that it no longer
wishes to invest in the stock on which the put option had been written, the Fund
may be able to effect a closing purchase transaction on an exchange by
purchasing a put option of the same series as the one which it has previously
written. The cost of effecting a closing purchase transaction may be greater
than the premium received on writing the put option and there is no guarantee
that a closing purchase transaction can be effected.

Each Fund may only write covered put options to the extent that cover for such
options does not exceed 25% of its net assets. Each Fund will not purchase an
option if, as a result of such purchase, more than 20% of its total assets would
be invested in premiums for such options.

The use of repurchase agreements involves certain risks. For example, if the
seller of the agreement defaults on its obligation to repurchase the underlying
securities at a time when the value of these securities has declined, the Fund
may incur a loss upon disposition of them. If the seller of the agreement
becomes insolvent and subject to liquidation or reorganization under the
Bankruptcy Code or other laws, a bankruptcy court may determine that the
underlying securities are collateral not within the control of the Fund and are
therefore subject to sale by the trustee in bankruptcy. Even though the
repurchase agreements may have maturities of seven days or less, they may lack
liquidity, especially if the issuer encounters financial difficulties. While
Fund management acknowledges these risks, it is expected that they can be
controlled through stringent selection criteria and careful monitoring
procedures. Fund management intends to limit repurchase agreements to
transactions with dealers and financial institutions believed by Fund management
to present minimal credit risks. Fund management will monitor creditworthiness
of the repurchase agreement sellers on an ongoing basis.

Rights And Warrants. Each Fund may invest in rights and warrants to purchase
securities. Included within that amount, but not to exceed 5% of the value of
the Fund's gross assets, may be warrants which are not listed on the NYSE or
American Stock Exchange.

<PAGE>

Risks Of Options On Indices. The Micro-Cap Value Fund's purchase and sale of
options on indices will be subject to risks described above under "Risk of
Transactions in Stock Options." In addition, the distinctive characteristics of
options on indices create certain risks that are not present with stock options.

Because the value of an index option depends upon movements in the level of the
index rather than the price of a particular stock, whether the Fund will
realize a gain or loss on the purchase or sale of an option on an index depends
upon movements in the level of stock prices in the stock market generally or in
an industry or market segment rather than movements in the price of a particular
stock. Accordingly, successful use by the Fund of options on indices would be
subject to the investment adviser's ability to predict correctly movements in
the direction of the stock market generally or of a particular industry. This
requires different skills and techniques than predicting changes in the price of
individual stocks.

Index prices may be distorted if trading of certain stocks included in the index
is interrupted. Trading in the index option also may be interrupted in certain
circumstances, such as if trading were halted in a substantial number of stocks
included in the index. If this occurred, the Fund would not be able to close out
options which it had purchased or written and, if restrictions on exercise were
imposed, may be unable to exercise an option it holds, which could result in
substantial losses to the Fund. It is the Funds' policy to purchase or write
options only on indices which include a number of stocks sufficient to minimize
the likelihood of a trading halt in the index.

Trading in index options commenced in April 1983 with the S&P 100 option
(formerly called the CBOE 100). Since that time a number of additional index
option contracts have been introduced including options on industry indices.
Although the markets for certain index option contracts have developed rapidly,
the markets for other index options are still relatively illiquid. The ability
to establish and close out positions on such options will be subject to the
development and maintenance of a liquid secondary market. It is not certain that
this market will develop in all index option contracts. The Fund will not
purchase or sell any index option contract unless and until, in Fund
management's opinion, the market for such options has developed sufficiently
that such risk in connection with such transactions in no greater than such risk
in connection with options on stocks.

Risks Of Transactions In Stock Options. Writing options involves the risk that
there will be no market in which to effect a closing transaction. An option
position may be closed out only on an exchange which provides a secondary market
for an option of the same series. Although each Fund will generally write only
those options for which there appears to be an active secondary market, there is
no assurance that a liquid secondary market on an exchange will exist for any
particular option, or at any particular time, and for some options no secondary
market on an exchange may exist. If the Fund, as a covered call option writer,
is unable to effect a closing purchase transaction in a secondary market, it
will not be able to sell the underlying security until the option expires or it
delivers the underlying security upon exercise.

Rule 144A Securities. Both Funds may invest in Rule 144A securities, which are
securities determined by the Board to be liquid pursuant to the Securities and
Exchange Commission Rule 144A ("Rule 144A"). Under Rule 144A, a qualifying
unregistered security may be resold to a qualified institutional buyer without
registration and without regard to whether the seller originally purchased the
security for investment. Investments in Rule 144A securities initially
determined to be liquid could have the effect of diminishing the level of a
Fund's liquidity during periods of decreased market interest in such securities.

Short Sales. The Micro-Cap Value Fund may make short sales of securities or
maintain a short position, if at all times when a short position is opened the
Fund owns an equal amount of such securities or securities convertible into or
exchangeable, without payment of any further consideration, for an equal amount
of the securities of the same issuer as the securities sold short. The Micro-Cap
Value Fund does not intend to have more than 5% of its net assets (determined at
the time of the short sale) subject to short sales against the box.

<PAGE>

Stock Index Options. Except as describe below, the Micro-Cap Value Fund will
write call options on indices only if on such date it holds a portfolio of
stocks at least equal to the value of the index times the multiplier times the
number of contracts. When the Fund writes a call option on a broadly-based stock
market index, the Fund will segregate or put into escrow with its custodian, or
pledge to a broker as collateral for the option, one or more "qualified
securities" with a market value at the time the option is written of not less
than 100% of the current index value times the multiplier times the number of
contracts.

Stock Index Futures. The Micro-Cap Value Fund will engage in transactions in
stock index futures contracts as a hedge against changes resulting from market
conditions in the values of securities which are held in the Funds' portfolio or
which it intends to purchase. The Fund will engage in such transactions when
they are economically appropriate for the reduction of risks inherent in the
ongoing management of the Fund. The Fund may not purchase or sell stock index
futures if, immediately thereafter, more than one-third of its net assets would
be hedged and, in addition, except as described above in the case of a call
written and held on the same index, will write call options on indices or sell
stock index futures only if the amount resulting from the multiplication of the
then current level of the index (or indices) upon which the option or future
contract(s) is based, the applicable multiplier(s), and the number of futures or
options contracts which would be outstanding, would not exceed one-third of the
value of the Funds' net assets.

Special Risks Of Writing Calls On Indices. Because exercises of index options
are settled in cash, a call writer cannot determine the amount of its settlement
obligations in advance and, unlike call writing on specific stocks, cannot
provide in advance for, or cover, its potential settlement obligations by
acquiring and holding the underlying securities. However, the Funds will write
call options on indices only under the circumstances described above under
"Limitations on the Purchases and Sales of Stock Options, Options on Stock
Indices and Stock Index Futures."

Price movements in the Fund's portfolio probably will not correlate precisely
with movements in the level of the index and, therefore, the Fund bears the risk
that the price of the securities held may not increase as much as the index. In
such event the Fund would bear a loss on the call which is not completely offset
by movements in the price of the Fund's portfolio. It is also possible that the
index may rise when the Funds' portfolio of stocks does not rise. If this
occurred, the Fund would experience a loss on the call which is not offset by an
increase in the value of its portfolio and might also experience a loss in its
portfolio. However, because the value of a diversified portfolio will, over
time, tend to move in the same direction as the market, movements in the value
of the Fund in the opposite direction to the market would be likely to occur for
only a short period or to a small degree.

Unless the Fund has other liquid assets that are sufficient to satisfy the
exercise of a call, the Fund would be required to liquidate portfolio securities
in order to satisfy the exercise. Because an exercise must be settled within
hours after receiving the notice of exercise, if the Fund fails to anticipate an
exercise, it may have to borrow (in amounts not exceeding 20% of the Fund's
total assets) pending settlement of the sale of securities in its portfolio and
would incur interest charges thereon.

When the Fund has written a call, there is also a risk that the market may
decline between the time the call is written and the time the Fund is able to
sell stocks in its portfolio. As with stock options, the Fund will not learn
that an index option has been exercised until the day following the exercise
date but, unlike a call on stock where the Fund would be able to deliver the
underlying securities in settlement, the Fund may have to sell part of its stock
portfolio in order to make settlement in cash, and the price of such stocks
might decline before they can be sold. This timing risk makes certain strategies
involving more than one option substantially more risky with index options than
with stock options. For example, even if an index call which the Fund has
written is "covered" by an index call held by the Fund with the same strike
price, the Fund will bear the risk that the level of the index may decline
between the close of trading on the date the exercise notice is filed with the
clearing corporation and the close of trading on the date the Fund exercises the
call it holds or the time the Fund sells the call which in either case would
occur no earlier than the day following the day the exercise notice was filed.

Special Risks Of Purchasing Puts And Calls On Indices. If the Micro-Cap Value
Fund holds an index option and exercises it before final determination of the
closing index value for that day, it runs the risk that the level of the
underlying index may change before closing. If such a change causes the
exercised option to fall out-of-the-money, the Fund will be required to pay the
difference between the closing index value and the exercise price of the option
(times the applicable multiple) to the assigned writer. Although the Fund may be
able to minimize this risk by withholding exercise instructions until just
before the daily cut off time or by selling rather than exercising an option
when the index level is close to the exercise price it may not be possible to
eliminate this risk entirely because the cut off times for index options may be
earlier than those fixed for other types of options and may occur before
definitive closing index values are announced.

<PAGE>

2.
Trustees and Officers

The Company's Board of Directors is responsible for the management of the
business and affairs of each Fund.

The following trustee is a partner of Lord, Abbett & Co. ("Lord Abbett"), 90
Hudson Street, Jersey City, New Jersey 07302-3973. He has been associated with
Lord Abbett for over five years and is also an officer, director, or trustee of
the other Lord Abbett-sponsored funds. He is an "interested person" as defined
in the Act, and as such, may be considered to have an indirect financial
interest in the Rule 12b-1 Plan described in the Prospectus.

Robert S. Dow, age 54, Chairman and President

The following outside trustees are also directors or trustees of the other Lord
Abbett-sponsored funds referred to above.

E. Thayer Bigelow, Trustee
245 Park Avenue, Suite 2414
New York, New York

Senior Adviser, Time Warner Inc. Formerly, Acting Chief Executive Officer of
Courtroom Television Network (1997 - 1998). Formerly, President and Chief
Executive Officer of Time Warner Cable Programming, Inc. (1991 - 1997). Prior to
that, President and Chief Operating Officer of Home Box Office, Inc. Age 58.

William H.T. Bush, Trustee
Bush-O'Donnell & Co., Inc.
101 South Hanley Road, Suite 1025
St. Louis, Missouri

Co-founder and Chairman of the Board of financial advisory firm of
Bush-O'Donnell & Company (since 1986). Age 61.

Robert B. Calhoun, Jr., Trustee
Monitor Clipper Partners
650 Madison Avenue, 9th Floor
New York, New York

Managing Director of Monitor Clipper Partners (since 1997) and President of The
Clipper Group, both private equity investment funds (since 1990). Age 57.

Stewart S. Dixon, Trustee
Wildman, Harrold, Allen & Dixon
225 W. Wacker Drive (Suite 2800)
Chicago, Illinois

Partner in the law firm of Wildman, Harrold, Allen & Dixon since 1990). Age 69.

John C. Jansing, Trustee
162 S. Beach Road
Hobe Sound, Florida

Retired. Former Chairman of Independent Election Corporation of America, a proxy
tabulating firm. Age 74.

<PAGE>

C. Alan MacDonald, Trustee
415 Round Hill Road
Greenwich, Connecticut

Currently involved in golf development management on a consultancy basis (since
1999). Formerly, Managing Director of The Directorship Group, Inc., a
consultancy in board management and corporate governance (1997-1999). Prior to
that, General Partner of The Marketing Partnership, Inc., a full service
marketing consulting firm (1994-1997). Prior to that, Chairman and Chief
Executive Officer of Lincoln Snacks, Inc., manufacturer of branded snack foods
(1992-1994). His career spans 36 years at Stouffers and Nestle with 18 of those
years as Chief Executive Officer. Currently serves as Director of DenAmerican
Corp., J. B. Williams Company, Inc., Fountainhead Water Company, Exigent
Diagnostics. Age 66.

Hansel B. Millican, Jr., Trustee
Rochester Button Company
1328 Broadway (Suite 816)
New York, New York

President and Chief Executive Officer of Rochester Button Company (since 1991).
Currently serves as Director of Polyvision Corporation. Age 71.

Thomas J. Neff, Trustee
Spencer Stuart
277 Park Avenue
New York, New York

Chairman of Spencer Stuart, an executive search consulting firm (since 1976).
Currently serves as a Director of Ace, Ltd. (NYSE). Age 62.

<PAGE>

The second column of the following table sets forth the compensation
accrued by the Company for outside directors/trustees. The third column sets
forth information with respect to the pension or retirement benefits accrued by
all Lord Abbett-sponsored funds for outside directors/trustees. The fourth
column sets forth the total compensation paid by all Lord Abbett-sponsored funds
to the outside directors/trustees, and amounts payable but deferred at the
option of the director/trustee. No director/trustee of the funds associated with
Lord Abbett and no officer of the funds received any compensation from the funds
for acting as a director/trustee or officer.

For the Fiscal Year Ended October 31, 1999
------------------------------------------

(1) (2) (3) (4)

Pension or For Year Ended
Retirement Benefits December 31, 1999
Accrued by the Total Compensation
Aggregate Fund and Paid by the Fund and
Compensation Twelve Other Lord Twelve Other Lord
Accrued by Abbett-sponsored Abbett-sponsored
Name of Director the Fund/1 Funds/2 Funds/3
- ---------------- --------------------- ------------------------ -----------------------
<S> <C> <C> <C>
E. Thayer Bigelow $1,709 $17,622 $ 57,720
William H.T. Bush* $1,703 $15,846 $ 58,000
Robert B. Calhoun, Jr.** $1,680 $12,276 $ 57,000
Stewart S. Dixon $1,725 $32,420 $ 58,500
John C. Jansing $1,680 $41,108/4 $ 57,250
C. Alan MacDonald $1,695 $26,763 $ 57,500
Hansel B. Millican, Jr. $1,695 $37,822 $ 57,500
Thomas J. Neff $1,753 $20,313 $ 59,660

</TABLE>

*Elected as of August 13, 1998
**Elected as of June 17, 1998

1. Outside directors'/trustees' fees, including attendants fees for board and
committee meetings, are allocated among all Lord Abbett-sponsored funds
based on the net assets of each fund. A portion of the fees payable by the
Company to its outside directors/trustees may be deferred under a plan
("equity-based plan that deems the deferred amounts to be invested in
shares of the Fund for later distribution to the directors/trustees.

2. The amounts in Column 3 were accrued by the Lord Abbett-sponsored funds for
the 12 months ended October 31, 1999.

<PAGE>

3. The fourth column shows aggregate compensation, including directors'/
trustees' fees and attendance fees for board and committee meetings, of a
nature referred to in footnote one, accrued by the Lord Abbett-sponsored
funds during the year ended December 31, 1999, including fees directors/
trustees have chosen to defer but does not include amounts accrued under
the equity-based plans and shown in Column 3.

4. The equity-based plans superseded a previously approved retirement plan
for all directors/trustees. Directors/trustees had the option to convert
their accrued benefits under the retirement plan. All of the outside
directors/trsutees except one made such election. Mr. Jansing chose to
continue to receive benefits under the retirement plan which provides that
outside directors (trustees) may receive annual retirement benefits for
life equal to their final annual retainer following retirement at or after
age 72 with at least ten years of service. Thus, if Mr. Jansing were to
retire and the annual retainer payable by the funds were the same as it is
today, he would receive annual retirement benefits of $50,000.

Except where indicated, the following executive officers of the Fund have been
associated with Lord Abbett for over five years. Of the following, Messrs.
Brown, Carper, Fetch, Hilstad, Hudson, McGruder, Morris, Towle, and Walsh are
partners of Lord Abbett; the others are employees:

Executive Vice Presidents:
Zane E. Brown, age 48;

Robert P. Fetch, age 47;

W. Thomas Hudson, Jr., age 58;

Stephen I. McGruder, age 56;

Robert G. Morris, age 55.

Eli M. Salzman, age 35 (with Lord Abbett since 1997, formerly a Portfolio
Manager, Analyst at Mutual of America from 1996 to 1997, prior thereto Vice
President at Mitchell Hutchins Asset Management);

Vice Presidents:

Joan Binstock, age 45 (with Lord Abbett since 1999, formerly Chief Operating
Officer of Morgan Grenfell from 1996 to 1999, prior thereto Principal of Ernst &
Young LLP);

Daniel E. Carper, age 48;

Lesley Jane Dixon, age 36;

Paul A. Hilstad, age 57, Vice President and Secretary (with Lord Abbett since
1995; formerly Senior Vice President and General Counsel of American Capital
Management & Research, Inc.);

Timothy W. Horan, age 45;

Cinda C. Hughes, age 37 (with Lord Abbett since 1998, formerly Analyst/Director,
Equity Research at Phoenix Investment Counsel from 1996 to 1998, prior thereto
Associate Strategist - Small Cap Stocks at Paine Webber, Inc./Kidder, Peabody &
Co., Inc.);

Jerald Lanzotti, age 32;

Gregory M. Macosko, age 52 (with Lord Abbett since 1996, formerly an Equity
Analyst and Portfolio Manager at Quest Advisory Inc.);

<PAGE>

A. Edward Oberhaus, age 40;

Fernando Saldanha, age 45;

Christopher J. Towle, age 42;

John J. Walsh, age 63;

Treasurer:
Donna M. McManus, age 39, Treasurer (with Lord Abbett since 1996, formerly a
Senior Manager at Deloitte & Touche LLP).

The Company does not hold an annual meeting of shareholders in any year unless
one or more matters are required to be acted on by shareholders under the Act.
Under the Company's Declaration of Trust, shareholder meeting may be called at
any time by certain officers of the Company or by a majority of the Board of
Trustees (I) for the purpose of taking action upon any matter requiring the vote
or authority of the Company's shareholders or upon other matters deemed to be
necessary or desirable or (ii) upon the written request of the holders of at
least one-quarter of the shares of the Fund's outstanding shares entitled to
vote at the meeting..

As of February 1, 2000, our partners, officers and trustees, as a group, owned
approximately 100% of each Funds' outstanding shares. As of February 1, 2000,
there were no other record holders of 5% or more of each Funds' outstanding
shares. The ownership of each Fund's outstanding shares represents the initial
investment. It is anticipated that over time this percentage of ownership will
decrease.

3.
Investment Advisory And Other Services

The services performed by Lord Abbett are described under "Management" in the
Prospectus. Under the Management Agreement, each Fund is obligated to pay Lord
Abbett a monthly fee, based on average daily net assets for each month at the
annual rate of 1.50 of 1% for each of the Micro-Cap Growth Fund and the
Micro-Cap Value Fund. These fees are allocated among the classes of each Fund
based on the classes' proportionate share of each Fund's average daily net
assets. For the fiscal year ended October 31, 1999, such fees amounted to
$13,059 for Micro-Cap Growth Fund; and $10,786 for Micro-Cap Value Fund. For the
fiscal year ended October 31, 1999, such fees for both the Micro-Cap Growth Fund
and Micro-Cap Value Fund were waived.

Each Fund pays all expenses not expressly assumed by Lord Abbett, including,
without limitation, 12b-1 expenses, outside directors'/trustees' fees and
expenses, association membership dues, legal and auditing fees, taxes, transfer
and dividend disbursing agent fees, shareholder servicing costs, expenses
relating to shareholder meetings, expenses of preparing, printing and mailing
stock certificates and shareholder reports, expenses of registering our shares
under federal and state securities laws, expenses of preparing, printing and
mailing prospectuses to existing shareholders, insurance premiums, brokerage and
other expenses connected with executing portfolio transactions.

Lord Abbett Distributor LLC, a New York limited liability company ("Lord Abbett
Distributor") and subsidiary of Lord Abbett, 90 Hudson Street, Jersey City, NJ
07302, serves as the principal underwriter for the Funds.

Deloitte & Touche LLP, Two World Financial Center, New York, New York, are the
independent auditors of the Fund and must be approved at least annually by our
Board of Directors to continue in such capacity. Deloitte & Touche LLP perform
audit services for each Fund, including the examination of financial statements
included in our Annual Report to Shareholders.

<PAGE>

The Bank of New York ("BNY"), 48 Wall Street, New York, New York, is the Fund's
custodian. In accordance with the requirements of Rule 17f-5, the Fund's
directors/trustees have approved arrangements permitting the Funds' foreign
assets not held by BNY or its foreign branches to be held by certain qualified
foreign banks and depositories.

United Missouri Bank of Kansas City, N.A., Tenth and Grand, Kansas City,
Missouri, acts as the transfer agent and dividend disbursing agent for the
Funds.

4.
Portfolio Transactions

The Company's policy is to obtain best execution on all our portfolio
transactions, which means that it seeks to have purchases and sales of portfolio
securities executed at the most favorable prices, considering all costs of the
transaction including brokerage commissions and dealer markups and markdowns and
taking into account the full range and quality of the brokers' services.
Consistent with obtaining best execution, we generally pay, as described below,
a higher commission than some brokers might charge on the same transaction. This
policy with respect to best execution governs the selection of brokers or
dealers and the market in which the transaction is executed. To the extent
permitted by law, we may, if we consider it advantageous, make a purchase from
or sale to another Lord Abbett-sponsored fund without the intervention of any
broker-dealer.

Broker-dealers are selected on the basis of their professional capability and
the value and quality of their brokerage and research services. Normally, the
selection is made by traders who are officers of each Lord Abbett-sponsored fund
and also are employees of Lord Abbett. These traders do the trading as well for
other accounts -- investment companies (of which they are also officers) and
other investment clients -- managed by Lord Abbett. They are responsible for
obtaining best execution.

We pay a commission rate that we believe is appropriate to give maximum
assurance that our brokers will provide us, on a continuing basis, the highest
level of brokerage services available. While we do not always seek the lowest
possible commissions on particular trades, we believe that our commission rates
are in line with the rates that many other institutions pay. Our traders are
authorized to pay brokerage commissions in excess of those that other brokers
might accept on the same transactions in recognition of the value of the
services performed by the executing brokers, viewed in terms of either the
particular transaction or the overall responsibilities of Lord Abbett with
respect to us and the other accounts they manage. Such services include showing
us trading opportunities including blocks, a willingness and ability to take
positions in securities, knowledge of a particular security or market proven
ability to handle a particular type of trade, confidential treatment, promptness
and reliability.

<PAGE>

Some of these brokers also provide research services at least some of which are
useful to Lord Abbett in their overall responsibilities with respect to us and
the other accounts they manage. Research includes the furnishing of analyses and
reports concerning issuers, industries, securities, economic factors and trends,
portfolio strategy and the performance of accounts and trading equipment and
computer software packages, acquired from third-party suppliers, that enable
Lord Abbett to access various information bases. Such services may be used by
Lord Abbett in servicing all their accounts, and not all of such services will
necessarily be used by Lord Abbett in connection with their management of the
Fund; conversely, such services furnished in connection with brokerage on other
accounts managed by Lord Abbett may be used in connection with their management
of the Fund, and not all of such services will necessarily be used by Lord
Abbett in connection with their advisory services to such other accounts. We
have been advised by Lord Abbett that research services received from brokers
cannot be allocated to any particular account, are not a substitute for Lord
Abbett's services but are supplemental to their own research effort and, when
utilized, are subject to internal analysis before being incorporated by Lord
Abbett into their investment process. As a practical matter, it would not be
possible for Lord Abbett to generate all of the information presently provided
by brokers. While receipt of research services from brokerage firms has not
reduced Lord Abbett's normal research activities, the expenses of Lord Abbett
could be materially increased if it attempted to generate such additional
information through its own staff and purchased such equipment and software
packages directly from the suppliers.

If two or more broker-dealers are considered capable of offering the equivalent
likelihood of best execution, the broker-dealer who has sold the Lord
Abbett-sponsored funds' shares and/or shares of other Lord Abbett-sponsored
funds may be preferred.

If other clients of Lord Abbett buy or sell the same security at the same time a
Lord Abbett-sponsored fund does, transactions will, to the extent practicable,
be allocated among all participating accounts in proportion to the amount of
each order and will be executed daily until filled so that each account shares
the average price and commission cost of each day. Other clients who direct that
their brokerage business be placed with specific brokers or who invest through
wrap accounts introduced to Lord Abbett by certain brokers may not participate
with a Lord Abbett-sponsored fund in the buying and selling of the same
securities as described above. If these clients wish to buy or sell the same
security as a Lord Abbett-sponsored fund does, they may have their transactions
executed at times different from our transactions and thus may not receive the
same price or incur the same commission cost as a Lord Abbett-sponsored fund
does.

The Lord Abbett-sponsored funds will not seek "reciprocal" dealer business (for
the purpose of applying commissions in whole or in part for their benefit or
otherwise) from dealers as consideration for the direction to them of portfolio
business.

For the fiscal year ended October 31, 1999, we paid total commissions to
independent broker-dealers of $6,057.

5.
Purchases, Redemptions
And Shareholder Services

Information concerning how we value our shares for the purchase and redemption
of our shares is contained in the Prospectus under "Purchases" and
"Redemptions", respectively.

As disclosed in the Prospectus, we calculate our net asset value as of the close
of the New York Stock Exchange ("NYSE") on each day that the NYSE is open for
trading by dividing our total net assets by the number of shares outstanding at
the time of calculation. The NYSE is closed on Saturdays and Sundays and the
following holidays -- New Year's Day, Martin Luther King, Jr. Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and
Christmas.

The Company values its portfolio securities at market value as of the close of
the NYSE. Market value will be determined as follows: securities listed or
admitted to trading privileges on the New York or American Stock Exchange or on
the NASDAQ National Market System are valued at the last sales price, or, if
there is no sale on that day, at the mean between the last bid and asked prices,
or, in the case of bonds, in the over-the-counter market if, in the judgment of
the Funds' officers, that market more accurately reflects the market value of
the bonds. Over-the-counter securities not traded on the NASDAQ National Market
System are valued at the mean between the last bid and asked prices. Securities
for which market quotations are not available are valued at fair market value
under procedures approved by the Board of Directors.

<PAGE>

The net asset value per share for the Class Y shares will be determined by
taking Class Y shares net assets and dividing by shares outstanding. Our Class Y
shares will be offered at net asset value.

Each Fund has entered into a distribution agreement with Lord Abbett Distributor
LLC, under which Lord Abbett Distributor is obligated to use its best efforts to
find purchasers for the shares of each Fund, and to make reasonable efforts to
sell Fund shares so long as, in Lord Abbett Distributor's judgment, a
substantial distribution can be obtained by reasonable efforts.

Class Y Share Exchanges. The Prospectus describes the Telephone Exchange
Privilege. You may exchange some or all of your Y shares for Y shares of any
Lord Abbett-sponsored funds currently offering Class Y shares to the public.
Currently those other funds consist of Lord Abbett Affiliated Fund, Lord Abbett
Investment Trust - High Yield Fund, Core Fixed Income Fund, and Strategic Core
Fixed Income Fund, Lord-Abbett - Bond-Debenture Fund, Lord Abbett Developing
Growth Fund, Lord Abbett Mid-Cap Value Fund, Lord Abbett Research Fund - Growth
Opportunities Fund, Small-Cap Value Series and Large-Cap Value Series, and Lord
Abbett Securities Trust - International Series.

Redemptions. A redemption order is in proper form when it contains all of the
information and documentation required by the order form or supplementally by
Lord Abbett Distributor or the Fund to carry out the order. The signature(s) and
any legal capacity of the signer(s) must be guaranteed by an eligible guarantor.
See the Prospectus for expedited redemption procedures.

The right to redeem and receive payment, as described in each Prospectus, may be
suspended if the NYSE is closed (except for weekends or customary holidays),
trading on the NYSE is restricted or the Securities and Exchange Commission
deems an emergency to exist.

Our Board of Trustees may authorize redemption of all of the shares in any
account in which there are fewer than 25 shares. Before authorizing such
redemption, the Board must determine that it is in our economic best interest or
necessary to reduce disproportionately burdensome expenses in servicing
shareholder accounts. At least 6 month's prior written notice will be given
before any such redemption, during which time shareholders may avoid redemption
by bringing their accounts up to the minimum set by the Board.

6.
Performance

Each Fund computes the annual compounded rate of total return for Class Y shares
during specified periods that would equate the initial amount invested to the
ending redeemable value of such investment by adding one to the computed average
annual total return, raising the sum to a power equal to the number of years
covered by the computation and multiplying the result by one thousand dollars,
which represents a hypothetical initial investment. The calculation assumes
deduction of no sales charge from the initial amount invested and reinvestment
of all income dividends and capital gains distributions on the reinvestment
dates at prices calculated as stated in the Prospectus. The ending redeemable
value is determined by assuming a complete redemption at the end of the
period(s) covered by the annual total return computation.

In calculating total returns for Class Y shares no sales charge is deducted from
the initial investment and the return is shown at net asset value. Total returns
also assume that all dividends and capital gains distributions during the period
are reinvested at net asset value per share, and that the investment is redeemed
at the end of the period.

Our yield quotation for Class Y shares is based on a 30-day period ended on a
specified date, computed by dividing the net investment income per share earned
during the period by the net asset value per share of such class on the last day
of the period. This is determined by finding the following quotient: take the
dividends and interest earned during the period for the class minus its expenses
accrued for the period and divide by the product of (i) the average daily number
of Class shares outstanding during the period that were entitled to receive
dividends and (ii) the net asset value per share of such class on the last day
of the period. To this quotient add one. This sum is multiplied by itself five
times. Then one is subtracted from the product of this multiplication and the
remainder is multiplied by two. Yields for Class Y shares do not reflect the
deduction of any sales charge.

<PAGE>

7.
Taxes

Each Fund intends to elect and to qualify for special tax treatment afforded
regulated investment companies under the Internal Revenue Code of 1986 (the
"Code"). If it so qualifies, each Fund (but not its shareholders) will be
relieved of federal income taxes on the amount it timely distributes to
shareholders. If in any taxable year a Fund does not qualify as a regulated
investment company, all of its taxable income will be taxed to the Fund at
regular corporate rates.

Each Fund contemplates declaring as dividends substantially all of its net
investment income. Dividends paid by each Fund from its investment income and
distributions of its net realized long-term capital gains are taxable to
shareholders as ordinary income or capital gains, whether received in cash or
reinvested in additional shares of the Fund. Each Fund will send each
shareholder annual information concerning the tax treatment of dividends
and other distributions.

Upon sale, exchange or redemption of shares of a Fund, a shareholder will
recognize short- or long-term capital gain or loss, depending upon the
shareholder's holding period in the Fund's shares. However, if a shareholder's
holding period in his shares is six months or less, any capital loss realized
from a sale or exchange of such shares must be treated as long-term capital loss
to the extent of dividends classified as "capital gains dividends" received with
respect to such shares. The maximum tax rates applicable to net capital gains
recognized by individuals and other non-corporate taxpayers are (i) the same as
ordinary income rates for capital assets held for one year or less and (ii) 20%
for capital assets held for more than one year. Capital gains or losses
recognized by corporate shareholders are subject to tax at the ordinary income
tax rates applicable to corporations.

Some shareholders may be subject to a 31% withholding tax on reportable
dividends, capital gains distributions and redemption payments ("backup
withholding"). Generally, shareholders applicable subject to backup withholding
will be those for whom a certified taxpayer identification number is not on
file with the Fund or who, to the Fund's knowledge, have furnished an incorrect
number. When establishing an account, an investor must certify under penalties
of perjury that such number is correct and that he or she is not otherwise
subject to backup withholding.

The writing of call options and other investment techniques and practices which
a Fund may utilize may affect the character and timing of the recognition of
gains and losses. Such transactions may increase the amount of short-term
capital gain realized by such Fund, which is taxed as ordinary income when
distributed to shareholders.

Each Fund may be subject to foreign withholding taxes, which would reduce the
yield on its investments. It is generally expected that Fund shareholders who
are subject to U. S. federal income tax will not be entitled to claim a federal
income tax credit or deduction for foreign income taxes paid by such Fund.

Each Fund will be subject to a 4% non-deductible excise tax on certain amounts
not distributed or treated as having been distributed on a timely basis each
calendar year. Each Fund intends to distribute to shareholders each year an
amount adequate to avoid the imposition of such excise tax.

Dividends paid by a Fund will qualify for the dividends-received deduction for
corporations to the extent they are derived from dividends paid by domestic
corporations. Corporate shareholders must have held their shares in a Fund
for more than 45 days to qualify for the deduction on dividends paid by the
Fund.

<PAGE>

Gain and loss realized by a Fund on certain transactions, including sales of
foreign debt securities and certain transactions involving foreign currency,
will be treated as ordinary income or loss for federal income tax purposes to
the extent, if any, that such gain or loss is attributable to changes in
exchange rates for foreign currencies. Accordingly, distributions taxable
as ordinary income will include the net amount, if any, of such foreign
exchange gain and will be reduced by the net amount, if any, of such foreign
exchange loss.

If the Funds purchase shares in certain foreign investment entities called
"passive foreign investment companies," they may be subject to United States
federal income tax on a portion of any "excess distribution" or gain from the
disposition of such shares, even if such income is distributed as a taxable
dividend by the Fund to their shareholders. Additional charges in the nature of
interest may be imposed on the Funds in respect of deferred taxes arising from
such distributions or gains. If a Fund was to make a "qualified electing fund"
election with respect to its investment in a passive foreign investment company,
in lieu of the foregoing requirements, such Fund might be required to include in
income each year a portion of the ordinary earnings and net capital gains of the
qualified electing fund, even if such amount were not distributed to the Fund.
Alternataively, if the Fund were to make a "mark-to-market" election with
respect to an investment in a passive foreign investment company, gain with
respect to the investment would be considered realized at the end of each
taxable year of the Fund even if the Fund continued to hold the investment.

The foregoing discussion relates solely to U.S. federal income tax law as
applicable to U.S. persons (U.S. citizens or residents and United States
domestic corporations, partnerships, trusts and estates.) Each shareholder who
is not a U.S. person should consult his tax adviser regarding the U.S. and
foreign tax consequences of the ownership of shares of the Fund, including the
applicable rate of U.S. withholding tax on dividends representing ordinary
income and net short-term capital gains, and the applicability of U.S. gift and
estate taxes.

8.
Information About the Company

The directors, trustees and officers of Lord Abbett-sponsored mutual funds,
together with the partners and employees of Lord Abbett, are permitted to
purchase and sell securities for their personal investment accounts. In engaging
in personal securities transactions, however, such persons are subject to
requirements and restrictions contained in the Fund's Code of Ethics which
complies, in substance, with each of the recommendations of the Investment
Company Institute's Advisory Group on Personal Investing. Among other things,
the Code requires that Lord Abbett partners and employees obtain advance
approval before buying or selling securities, submit confirmations and quarterly
transaction reports, and obtain approval before becoming a director of any
company; and it prohibits such persons from investing in a security 7 days
before or after any Lord Abbett-sponsored fund or Lord Abbett-managed account
considers a trade or trades in such security, prohibiting profiting on trades of
the same security within 60 days and trading on material and non-public
information. The Code imposes certain similar requirements and restrictions on
the independent directors and trustees of each Lord Abbett-sponsored mutual fund
to the extent contemplated by the recommendations of such Advisory Group.

9.
Financial Statements

The financial statements for the fiscal year ended October 31, 1999 with respect
to Micro-Cap Growth Fund and Micro-Cap Value Fund and the reports of Deloitte &
Touche LLP, independent auditors, on such financial statements contained in the
1999 Annual Reports to Shareholders of the Lord Abbett Securities Trust are
incorporated herein by reference to such financial statements and report in
reliance upon the authority of Deloitte & Touche LLP as experts in auditing and
accounting.