Dec. 27, 2002 — Fremont Investment Advisors is replacing Kern Capital Management as manager of the $39 million Fremont Mutual Fds:US Small Cap Fund (FUSSX).

Yvette Bockstein and Grant Babyak of TimesSquare Capital Management will take over the fund at the end of the year, succeeding David Kern, who has managed the offering since its inception in September 1997.

In explaining the switch, Bill Ferguson, Fremont’s senior vice president of marketing and product development, said: “In talking with financial advisors and retirement plan consultants, we learned that they want investment products with consistent performance and relatively low standard deviation. The US Small Cap Fund had a fantastic year in 1999, and has since dropped off. Thus, its standard deviation has been higher than we’d like to see in that type of product.”

After surging 125.2% in 1999, the fund declined 26.9% in 2000 and 13.2% last year. Fremont US Small Cap was down 33.8% this year through November, while the average small-cap growth fund was off 24%.

Kern Capital Management will continue to oversee the Fremont Mutual Fds:US Micro Cap Fund (FUSMX)and the Fremont Mutual Fds:US Micro Cap Fund/Instl (FIMCX).

New York-based TimesSquare manages about $44 billion in assets, primarily for institutions. Bockstein and Babyak are managing directors of the firm and portfolio managers in its small-cap growth group.