UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.      )

Filed by the Registrantx

Filed by a Party other than the Registrant¨

Check the appropriate box:

¨ Preliminary Proxy Statement

¨ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

x Definitive Proxy Statement

¨ Definitive Additional Materials

¨ Soliciting Material Pursuant to § 240.14a-12

HARBOR FUNDS

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

x No fee required.

¨ Fee computed on table below per Exchange Act Rule 14a-6(i)(1) and 0-11.

October 8, 2010April 19, 2013

Dear Fellow Harbor Funds Shareholder,

Harbor Funds will hold a Special Meeting of Shareholders on Tuesday, December 14, 2010June 25, 2013 at its offices in Chicago, Illinois. Illinois (the “Meeting”). This Special Meeting is being called because the parent company of Harbor Capital Advisors, Inc. (“Harbor Capital”) is expected to be sold, which would result in a change of control of Harbor Capital. While the proposed transaction would result in a change of control, we do not believe that it would have any material impact on Harbor Capital’s investment philosophy, management approach, staffing or operations or on how Harbor Capital manages each Harbor fund. The proposed transaction would also have no impact on the subadvisers to each Harbor fund.

The proposed transaction (the “Transaction”) involves the sale of 90% plus one share of the outstanding shares of Robeco Groep N.V. (“Robeco”) by its current parent company, Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (“Rabobank”), to ORIX Corporation (“ORIX”). Harbor Capital has been a subsidiary of Robeco since 2001. Following the Transaction, Harbor Capital will remain a subsidiary of Robeco. Robeco will be owned primarily by ORIX with Rabobank retaining only an interest of 10% minus one share in Robeco. ORIX is an integrated financial services group based in Tokyo, Japan. With operations in 28 countries and regions worldwide, ORIX’s activities include corporate financial services, such as leases and loans, as well as automobile operations, rental operations, real estate, life insurance, banking and loan servicing.

The change of control caused by the Transaction will result in the termination of the existing advisory agreements between each Harbor Fund (each, a “Fund” and, collectively, the “Funds”) and Harbor Capital. For Harbor Capital to continue as the Funds’ adviser following the closing of the Transaction, Harbor Funds is required to seek the approval by the shareholders of the Funds of new advisory agreements between Harbor Capital and each Harbor fund that would take effect if the Transaction is completed. The Harbor Funds’ Board of Trustees (the “Board of Trustees”), whose primary responsibility is to you as shareholders, has evaluated the Transaction, believes that the Transaction will not be adverse to the Funds and Harbor Capital and believes that approving new advisory agreements between Harbor Capital and each Fund is in the best interests of Harbor Funds and its shareholders. Accordingly, the Board of Trustees has unanimously voted to approve new advisory agreements for each Fund and to recommend that the shareholders of Harbor Funds also approve the new advisory agreements for each Fund. At the same time, the Board of Trustees determined that this would be an appropriate opportunity to seek shareholder approval of an Amended and Restated Agreement and Declaration of Trust for Harbor Funds (the “Amended DT”) in order to modernize Harbor Funds’ principal governing document.

The enclosed proxy statement explains the one proposaltwo proposals that the Harbor Funds’ Board of Trustees is requestingrecommending that shareholders approve at the Meeting:

Please note that the electionTransaction would not result in any change in the advisory fees paid by each Fund to Harbor Capital or in any change in the services provided by Harbor Capital to each Fund. Also, Harbor Funds will not bear any portion of three Trustees – Raymond J. Ball, Donna J. Dean and Randall A. Hack —the costs related to the Board.Transaction.

The three nominees have not been elected previouslyP.O. Box 804660  |  Chicago, Illinois 60680-4108

800-422-1050  |  www.harborfunds.com

Distributed by shareholders. Two of the three nominees mentioned above, Mr. Ball and Mr. Hack, were appointed to the Board and already serve as Trustees. The third nominee, Ms. Dean, does not currently serve on the Board. A limited number of appointments to the Board are permitted without a shareholder vote to minimize the frequency with which mutual fund shareholders are asked to incur the expense associated with contacting shareholders and administering a proxy vote. The Board recommends the election of Mr. Ball, Ms. Dean and Mr. Hack. The nominations for election to the Board are an important part of a plan undertaken by the Board several years ago. The purpose of the plan is to add trustees periodically in order to broaden the skills represented on the Board and to plan for retirements expected to occur pursuant to a retirement policy adopted by the Board in August 1999.Harbor Funds Distributors, Inc.

Thank you for your interestinvestment in Harbor Funds. I encourage you to exercise your rights in governing Harbor Funds by voting on the proposal.proposals. The Independent Trustees of each Fund and I recommend that you vote FOR each proposal contained in the proxy statement. Your vote is important. Whether or not you expect to attend the Meeting, it is important that your shares be represented. Your immediate response will help savereduce the costs ofneed for Harbor Funds to conduct additional proxy solicitations. Please review the proxy statement and then vote by Internet, telephone or mail as soon as possible. If you vote by mail, please sign and return all of the Proxy Cardsproxy cards included in this package.

Sincerely,

David G. Van Hooser

Chairman of the Board of Trustees

P.O. Box 804660 | Chicago, Illinois 60680-4108

800-422-1050 | www.harborfunds.com

Distributed by Harbor Funds Distributors, Inc.

IMPORTANT INFORMATION

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We encourage you to vote via the Internet or telephone using the control number on your proxy card and follow the simple instructions, because these methods save the Funds the most money (since they require no return postage). If you would like to change your previous vote, you may vote again using any of the methods described above.

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HARBOR FUNDS

HARBOR FUNDS

111 South Wacker Drive, 34^th34th Floor

Chicago, Illinois 60606

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

To be held December 14, 2010

June 25, 2013

Harbor Funds will host a Special Meeting of Shareholders on Tuesday, December 14, 2010June 25, 2013 at its offices at 111 South Wacker Drive, Chicago, Illinois 60606, at 10:00 a.m. Central Time (the “Meeting”). This Meeting of the Harbor Funds is being held so that shareholders can vote on a proposal to electconsider the following three nominees to the Board of Trustees of Harbor Funds:following:

v         Donna J. Dean

v         Randall A. Hack

Each new advisory agreement would take effect only if the proposed sale of Harbor Capital’s parent company is consummated.

THE BOARD OF TRUSTEES OF HARBOR FUNDS UNANIMOUSLY RECOMMENDS THAT YOU VOTE IN FAVOR OF EACH PROPOSAL. APPROVAL OF NEW ADVISORY AGREEMENTS IS BEING PROPOSED BECAUSE THE CONSUMMATION OF THE PROPOSED SALE OF HARBOR CAPITAL’S PARENT COMPANY WILL RESULT IN THE TERMINATION OF THE EXISTING ADVISORY AGREEMENTS BETWEEN HARBOR FUNDS AND HARBOR CAPITAL. APPROVAL OF THE PROPOSALS WOULD NOT RESULT IN AN INCREASE IN ANY FUND’S ADVISORY FEE RATE OR A CHANGE IN THE SUBADVISER TO ANY FUND.

Shareholders of record of each Fund at the close of business on the record date, October 4, 2010,April 12, 2013, are entitled to notice of and to vote at the Meeting and any adjournment(s) thereof. The Notice of Special Meeting of Shareholders, proxy statement and proxy card are being mailed on or about April 29, 2013 to such shareholders of record.

By Order of the Board of Trustees,

Erik D. Ojala, Secretary

October 8, 2010Chicago, Illinois

April 19, 2013

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YOUR VOTE IS IMPORTANT

You can vote easily and quickly over the Internet, by toll-free telephone call, or by mail. Just follow the simple instructions that appear on your enclosed proxy card or voting instruction card. Please help your Fund avoidreduce the expense of aneed to conduct telephone solicitation and/or follow-up mailingmailings by voting today.

HARBOR FUNDS

PROXY STATEMENT

111 South Wacker Drive, 34^th34th Floor

Chicago, Illinois 60606

SPECIAL MEETING OF SHAREHOLDERS

December 14, 2010June 25, 2013

Introduction

This proxy statement is being provided to you on behalf of the Board of Trustees of Harbor Funds. You are being asked to vote on one proposaltwo proposals. The following table identifies the proposals set forth in this proxy statement and indicates which is to elect three Trustees to the Board of Trustees of Harbor Funds. This proposal applies to all Harbor funds (the(each a “Fund” and, collectively, the “Funds”). are affected by the proposal and whether such Funds vote separately or together on such proposal.

You will find this proxy statement divided into four parts:

For purposes of this proxy statement, Harbor Target Retirement Income Fund, Harbor Target Retirement 2010 Fund, Harbor Target Retirement 2015 Fund, Harbor Target Retirement 2020 Fund, Harbor Target Retirement 2025 Fund, Harbor Target Retirement 2030 Fund, Harbor Target Retirement 2035 Fund, Harbor Target Retirement 2040 Fund, Harbor Target Retirement 2045 Fund, and Harbor Target Retirement 2050 Fund may be referred to collectively as the “Target Retirement Funds.”

Please read the proxy statement before voting on the proposals. Please call us toll-free at 800-422-1050 or e-mail us at proxyrequests@harborfunds.com if you have any questions about the proxy statement, or if you would like additional information.

Under rules adopted by the Securities and Exchange Commission, we are providing Harbor Funds shareholders with the choice of accessing these proxy materials over the Internet, rather than receiving printed copies of these materials through the mail. A Notice Regarding the Availability of Proxy Materials (the “Notice”) is being mailed to shareholders who have not previously requested electronic access to proxy materials or paper proxy materials. The Notice contains instructions on how you may access and review these proxy materials on the Internet and how you may vote your shares over the Internet. The Notice will also tell you how to request these proxy materials in printed form or by e-mail, at no charge. The Notice contains a control number that you will need to vote your shares. Please keep the Notice for your reference through the Meeting date. For those who have previously requested printed proxy materials or electronic materials on an ongoing basis, you will receive those materials as you requested.

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We anticipate that the Notice of Special Meeting of Shareholders, this proxy statement and the proxy card (collectively, the “proxy materials”) will be mailed to shareholders beginning on or about October 14, 2010.April 29, 2013.

ToAlthough Harbor Funds will not bear any expenses in connection with the Transaction, to help lower the impact of operating costs generally, Harbor Funds attempts to eliminate mailing duplicate documents to the same address. Shareholders of record who have the same address and last name and have not previously requested electronice-mail delivery of proxy materials will receive a single envelope containing the Noticesproxy materials for all shareholders having that address. The Noticeproxy materials for each shareholder will include that shareholder’s unique control number needed to vote his or her shares. If you wish to receive a separate copy of the Notice,proxy materials, or if, in the future, you would prefer to receive your Noticeproxy materials in a separate envelope, please contact Harbor Funds at 800-422-1050 or by mail at 111 South Wacker Drive, 34^th34th Floor, Chicago, Illinois 60606. Shareholders sharing a single mailing address who are currently receiving separate mailings can request delivery in a single envelope instead by calling the same telephone number or writing to the same address.

Annual and Semi-Annual Reports. Each Fund’s most recent annual and semi-annual reports to shareholders are available at no cost. You may read, print, or request mail delivery of a copy through our website at www.harborfunds.com. You may also request a report by calling us toll-free at 800-422-1050, by e-mailing us at funddocuments@harborfunds.com, or by writing to us at Harbor Services Group, Inc.,Funds, P.O. Box 804660, Chicago, Illinois 60680-4108.

Important Notice Regarding the Availability of Materials

for the Shareholder Meeting to be Held on June 25, 2013

The proxy statement for the Meeting is available at https://www.proxy-direct.com/hbf-24554

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PART 1

ELECTIONDESCRIPTION OF THREE TRUSTEES TO THE BOARDPROPOSAL 1

APPROVAL OF TRUSTEESA NEW ADVISORY AGREEMENT

(each Fund voting separately)

Introduction

Who are the nominees to the Board of Trustees of Harbor Funds?

Shareholders of Harbor Funds areThe Meeting is being askedcalled to consider a proposal necessitated by the electionproposed transaction (the “Transaction”) involving the planned sale of three nominees to the Board of Trustees of Harbor Funds.

Of the three nominees, Messrs. Ball and Hack currently serve on the Board of Trustees. Mr. Ball was appointed to the Board of Trustees in 2006 and currently serves as Chairman90% plus one share of the Audit Committee. Mr. Hack was appointedissued and outstanding shares of Robeco Groep N.V. (“Robeco”) by Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (“Rabobank”) to the Board of Trustees in 2010. Because Messrs. Ball and Hack are the only Trustees on the Board who have not been elected by shareholders, they are being nominated to stand for election at this Meeting together with the new candidate, Ms. Dean, as thisORIX Corporation (“ORIX”). Robeco is the first meetingparent company of shareholders since Messrs. Ball’s and Hack’s appointments to the Board. Each nominee has consented to serving as a Trustee for Harbor Funds if elected by shareholders. The mailing address for each of Harbor Funds’ Trustees and officers is 111 South Wacker Drive, 34^th Floor, Chicago, Illinois 60606. Each nominee would have responsibility, with his or her fellow Trustees, for all 28 series of Harbor Funds.

Why are Fund shareholders being asked to elect three Trustees?

The Board of Trustees is currently comprised of six members. The Board adopted a retirement policy in 1999 which requires each “Independent” Trustee (as defined below) to retire from the Board at the end of the year in which the Trustee turns 75. Mr. Howard P. Colhoun, who has served as a Trustee since the inception of Harbor Funds in 1986, turns 75 this year and is expected to retire from the Board at the end of the year, although he is expected to serve in the capacity as Trustee Emeritus for one year in 2011. Two of the other Independent Trustees, Messrs. John P. Gould and Rodger F. Smith, who have served on the Board since 1994 and 1987, respectively, will reach the retirement age in four and six years, respectively.

The Board believes it is very important to add well qualified persons to the Board and plan ahead for expected retirements by adding Trustees to the Board from time to time. The Board has considered it important to add two new trustees (Ms. Dean and Mr. Hack) in 2010 to ensure that there is sufficient overlap in tenure among new and existing Trustees so that the new members can benefit from the experiences and perspectives gained by the existing Trustees from their many years of service on the Board of Trustees of Harbor Funds. The Board was able to add Mr. Hack earlier this year through appointment but is not able to add any additional Trustees unless those Trustees are elected by shareholders.

The Investment Company Act of 1940 (the “Investment Company Act”) permits a mutual fund board to appoint new trustees provided that after those trustees are appointed, at least two-thirds of the trustees would have been elected by shareholders. In the context of the Harbor Funds Board currently, four of the six existing Trustees were elected by shareholders. The Board cannot appoint another Trustee because after such an appointment only four of the seven members would have been elected by shareholders (or 57%) and, thus, would be less than the two-thirds (or 67%) required to have been elected by shareholders.

Mr. Ball was appointed by the Board as a Trustee in 2006 and Mr. Hack was appointed in 2010. This is the first meeting of shareholders since Mr. Ball’s and Mr. Hack’s appointment. Although they already serve on the Board, having Messrs. Ball and Hack be elected by shareholders is important because it will give the Board additional flexibility in the future to appoint a limited number of additional new Trustees if necessary without incurring the costs of holding expensive shareholder meetings for each new Trustee.

How many of the nominees would be Independent Trustees if elected?

All three of the nominees would be Independent Trustees if elected by shareholders. Independent Trustees have no affiliation with Harbor Capital Advisors, Inc. (“Harbor Capital”), which serves as the investment adviser to each Fund. Because the consummation of the Transaction will result in Robeco having a new controlling shareholder, it would result in a change of control of both Robeco and Harbor Capital Advisors”and the automatic termination of the existing advisory agreements between Harbor Funds and Harbor Capital. If Proposal 1, regarding the approval of the new advisory agreements, is adopted by the Funds and the Transaction is consummated, Harbor Capital would continue to serve as the investment adviser to each Fund. In addition, each Fund’s subadviser (each, a “Subadviser”) would not change as a result of the Transaction. The Target Retirement Funds do not employ subadvisers. The Transaction is not expected to have any material impact on Harbor Capital’s investment philosophy, management approach, staffing or operations or on how Harbor Capital manages each Fund.

Each Fund’s new advisory agreement is substantially identical to the terms of the Fund’s current advisory agreement, except for:

The changes reflected in the proposed new advisory agreements are intended only to clarify and modernize the terms of each advisory agreement in light of the fact that new agreements were being proposed as a result of the Transaction. The changes do not affect in any way the nature or quality of the services provided by Harbor Capital to each Fund or the “Adviser”) orfiduciary responsibility owed by Harbor Capital to each Fund. Other than the changes in the dates of execution, effectiveness and termination these changes are not related to the Transaction.

Your approval of the new advisory agreements would not result in any change in any of the Funds’ advisory fee rates nor in any change in Subadvisers.

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Information Concerning Harbor Funds and Harbor Capital

Harbor Funds began offering shares to the public in 1986. From that start, Harbor Funds has grown from a single domestic equity fund to a family of funds with total net assets of approximately $73.9 billion as of March 31, 2013. Harbor Funds is currently comprised of twenty-eight separate funds, each with its own investment objective and policies. Harbor Capital, a registered investment adviser with the Securities and Exchange Commission (“SEC”) under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), has served as each Fund’s investment adviser since each Fund’s inception. Harbor Funds and Harbor Capital currently emphasize long-term performance and relatively low expenses as core principles for the operation of Harbor Funds and will continue to do so following the Transaction. Harbor Capital has been a wholly-owned, indirect subsidiary of Robeco since 2001.

The Transaction

ORIX and Rabobank have announced that they have entered into a Sale and Purchase Agreement dated February 19, 2013 in which ORIX has agreed to acquire 90% plus one share of the equity in Robeco from Rabobank. Rabobank would retain an interest of 10% minus one share in Robeco. ORIX is expected to issue ORIX treasury stock to Rabobank as part of the acquisition price to be paid, which would result in Rabobank becoming a minority shareholder of ORIX. No assurance can be given that Rabobank will permanently retain its interest in Robeco or ORIX. In addition, ORIX and Rabobank have agreed that Robeco’s banking activities, which are based only in the Netherlands, would be transferred to Rabobank with Robeco retaining responsibility for its client service. Closing of the Transaction is subject to legal and regulatory approvals, which are expected to be completed at the beginning of the second half of 2013. In addition, consummation of the Transaction is conditioned upon, among other than their service as Trustees and other than their ownershipthings, approval of Proposal 1 by the shareholders of the Funds (in any combination) representing in the aggregate at least 75% of Harbor Funds’ assets under management.

Information Concerning ORIX

The following information, which has been derived from ORIX’s public statements, regulatory filings and similar sources, is intended to give shareholders of Harbor Funds background information concerning ORIX and its various businesses.

ORIX is an integrated financial services group based in Tokyo, Japan, providing innovative value-added products and services to both corporate and retail customers. With operations in 28 countries and regions worldwide, ORIX’s activities include corporate financial services, such as fellow shareholders. Independent Trustees playleases and loans, as well as automobile operations, rental operations, real estate, life insurance, banking and loan servicing.

ORIX is a critical rolejoint stock corporation (kabushiki kaisha) formed under Japanese law with its principal place of business at Mita NN Building, 4-1-23 Shiba, Minato-ku, Tokyo 108-0014, Japan. ORIX was established on April 17, 1964 in overseeing Fund operationsOsaka, Japan as Orient Leasing Co., Ltd. by three trading companies and representingfive banks that included Nichimen Corporation, Nissho Corporation and Iwai Corporation (presently Sojitz Corporation), the interestsSanwa Bank, Toyo Trust & Banking (presently Mitsubishi UFJ Financial Group), the Industrial Bank of each Fund’s shareholders.Japan and Nippon Kangyo Bank (presently Mizuho Financial Group, Inc.), and the Bank of Kobe (presently Sumitomo Mitsui Financial Group Inc.). While ORIX maintains business relationships with these companies, they now hold only a limited number of ORIX shares in the aggregate.

If allORIX’s initial development occurred during the period of sustained economic growth in Japan during the 1960s and the early 1970s. ORIX capitalized on the growing demand in this period by expanding its portfolio of leasing assets. It was also during this time that ORIX’s marketing strategy shifted from a focus on using the established networks of the nominees are electedtrading companies and other initial shareholders to one that concentrated on independent marketing as the Board, sixnumber of ORIX branches expanded. In April 1970, ORIX listed its shares on the second section of the seven Trustees (85%) would be independent. Only Mr. David Van Hooser, who also serves as Chief Executive Officer and President of Harbor Capital Advisors, is not an Independent Trustee.

What areOsaka Securities Exchange. Since February 1973, ORIX’s shares have been listed on the qualificationsfirst sections of the Nominees?Tokyo Stock Exchange and the Osaka Securities Exchange. ORIX shares also trade publicly on the New York Stock Exchange in the form of American Depositary Receipts (ADRs).

ORIX today has six business segments: Corporate Financial Services (lending, leasing and the commission business for the sale of financial products); Maintenance Leasing (auto leasing and rentals, car sharing, and leasing and rental of precision measuring equipment and IT-related equipment); Real Estate (real estate development, rental and financing; facility operation; REIT asset management; and real estate investment advisory services); Investment and Operations (loan servicing, environment and energy-related business, and principal investment); Retail (life insurance, banking and card loan business); and Overseas Business (leasing, lending, investment in bonds, investment banking, and ship- and aircraft-related operations in the United States, Asia, Oceania and Europe). ORIX derives approximately 80 percent of its revenues

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from activities in Japan and the remainder from activities around the world. ORIX has offices in 28 countries and regions, including the United States. Overall, ORIX and its related companies have 18,647 employees (as of September 2012), with approximately 2,480 of those employees, including through majority-owned subsidiaries, based in the United States.

ORIX has acquired several businesses in the United States over the past decade, including the majority ownership of three businesses acquired since 2006. In January 2006, ORIX entered the investment banking field in the United States with the acquisition of Houlihan Lokey Inc. In May 2010, ORIX acquired RED Capital Group, a U.S.-based company that provides financing for multi-family, senior living and healthcare-related real estate development projects in the United States. In December 2010, ORIX acquired Mariner Investment Group LLC, a leading independent SEC-registered hedge fund.

Terms of the Sale and Purchase Agreement

The following is a descriptionsummary of the terms of the Transaction considered relevant to Harbor Funds:

Pursuant to the sale and purchase agreement executed between ORIX and Rabobank as of February 19, 2013 (the “Agreement”), ORIX would acquire from Rabobank 4,084,023 shares of Robeco (the “Shares”), which represent 90% plus one share of the total number of issued shares of Robeco held by Rabobank, and Robeco would become a consolidated subsidiary of ORIX.

The total acquisition amount of the Shares (the “Total Share Amount”) was calculated to be approximately 1.935 billion euro as of February 19, 2013, which is the date of execution of the Agreement (approximately $2.6 billion at then-current exchange rates). However, such amount is subject to adjustment depending on a variety of factors, including the financial condition of Robeco as of the end of the month immediately preceding the month in which the date of transfer of the Shares falls. ORIX is expected to issue to Rabobank treasury shares to pay a portion of the purchase price (up to a maximum of 150 million euro). Payment of the Total Share Amount other than the amount paid in treasury shares would be made in cash.

The Transaction is expected to close as early as July 1, 2013, provided that a number of conditions set forth in the Agreement are satisfied or waived. The closing conditions include, among other things, the approval of the new advisory agreements by shareholders of Funds (in any combination) representing in the aggregate at least 75% of Harbor Funds’ assets under management and obtaining certain foreign and domestic regulatory approvals, consents, licenses and permits. The closing of the Transaction is also subject to applicable legal and regulatory approval including the clearance required under the competition laws in some countries including the United States.

The Agreement does not contemplate any change in Harbor Capital, Harbor Funds, or any Fund’s Subadviser, portfolio manager(s) or portfolio management team. After consummation of the Transaction, and assuming shareholder approval of the new advisory agreements, Harbor Capital would continue to review actively the performance of each nominee’s specific experience, qualifications, attributes and/or skillsSubadviser and may, upon approval of the Trustees, replace a Subadviser when Harbor Capital believes a change would be in the best interests of the Fund’s shareholders. Because Harbor Funds and Harbor Capital have received an order from the SEC granting an exemption from the requirement that served assubadvisory agreements be approved by shareholders, a subadviser may be replaced without shareholder approval. Shareholders of that Harbor fund would subsequently receive an information statement in lieu of a proxy statement containing information about the basis fornew subadviser and the Board’s belief that these individuals would contribute in a very positive wayterms of the new subadvisory agreement. With respect to the operationTarget Retirement Funds, Harbor Capital would continue to provide day-to-day portfolio management services after consummation of the Transaction.

It is expected that, following the Transaction, Harbor Capital would remain a wholly-owned indirect subsidiary of Robeco.

Transaction Not Expected to Adversely Affect Harbor Capital or Harbor Funds

It is anticipated that the Transaction and Harbor Capital’s affiliation with ORIX would not result in any change in the services provided by Harbor Capital to Harbor Funds. It is further anticipated that the Transaction and Harbor Capital’s affiliation with ORIX would not diminish in any way Harbor Capital’s ability to continue to provide a high level of service to Harbor Funds going forward. In particular, the Transaction is not expected to result in any material changes in the manner in which Harbor Capital would render advisory or administrative services to the Funds or the composition of the senior management or personnel providing services to Harbor Funds (although the Transaction is not conditioned upon the continued employment of any Harbor Capital personnel, and there can be no assurance that any particular Harbor

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Capital employee will continue his or her employment with Harbor Capital or its affiliates). The Agreement does not contemplate any changes in the management or operations of Harbor Capital relating to the Funds, or in the management or operations of the other service providers to the Funds, other than changes in the ordinary course of business. In addition, there would be no change in the Funds’ Subadvisers as a result of the Transaction. Further, the Board of Trustees would not change as a result of the Transaction. Harbor Capital and Harbor Funds would remain headquartered in Chicago, Illinois following the consummation of the Transaction. Shareholders should expect the same quality of services to which they have become accustomed.

Impact of the Transaction on the Funds’ Advisory Agreements and Summary of the Proposal

Shareholders of each Fund are being asked to approve a proposed new advisory agreement with Harbor Capital. The consummation of the Transaction would constitute an “assignment” (as defined in the Investment Company Act) of each Fund’s current advisory agreement with Harbor Capital (each, an “existing advisory agreement”). As required by the Investment Company Act, each existing advisory agreement provides for its automatic termination in the event of an assignment. Accordingly, the existing advisory agreements will terminate upon the consummation of the Transaction, and the new advisory agreements are necessary if Harbor Capital is to continue to manage the Funds.

Factors Considered by the Trustees and their Recommendation

At a special in-person meeting of the Board of Trustees of Harbor Funds. These encompass a variety of factors,Funds held on March 25-26, 2013, the Trustees, including but not limited to, their financial and investment experience, academic background, willingness to devote the time and attention needed to serve as Trustees, and past experience as Trustees of Harbor Funds, other investment companies, operating companies or other types of entities. No one factor was controlling. Trustees have been added to the Board at different times, and the qualifications sought by the Board have varied depending on the existing qualifications represented on the Board at that time. As discussed further below, the evaluation of the qualities and ultimate selection of persons to serve as Independent Trustees is the responsibility of the Harbor Funds’ Nominating Committee, consisting solely of Independent Trustees. The inclusion of a particular factor below does not constitute an assertion by the Board or any individual Trustee or nominee that the person has any special expertise that would impose any greater responsibility or liability when serving as a Trustee than would exist otherwise.

Raymond J. Ball. Mr. Ball is the Sidney Davidson Distinguished Service Professor of Accounting at the University of Chicago Booth School of Business, and a frequent lecturer and researcher on accounting, financial market and related business matters. Mr. Ball joined the University of Chicago Business School’s faculty in 2000 from the William E. Simon Graduate School of Business at the University of Rochester, where he served as the Wesray Professor in Business Administration. Mr. Ball’s teaching and research has a particular focus on corporate disclosure, earnings and stock prices, international accounting and finance, market efficiency and investment strategies. Mr. Ball is Coordinating Editor of the Journal of Accounting Research and a member of the Editorial

Board of the European Accounting Review, and serves on the Advisory Group for the Financial Reporting Faculty of the Institute of Chartered Accountants in England and Wales. He is a Fellow and CPA of the Australian Society of Certified Practising Accountants and a Fellow of the Financial Services Institute of Australia. From time to time, he serves as an expert witness and litigation consultant with respect to accounting, economic and financial market issues. Mr. Ball has served on the Financial Accounting Standards Advisory Council of the Financial Accounting Standards Board and the Shadow Financial Regulation Committee. Mr. Ball is the Board’s “audit committee financial expert” and Chairman of the Audit Committee and has served as a Trustee since his appointment by the Board in February, 2006.

Donna J. Dean. Ms. Dean serves as the Chief Investment Officer of the Rockefeller Foundation. The Rockefeller Foundation is a philanthropic organization established by the Rockefeller family in 1913 to promote the well-being of humanity. The Rockefeller Foundation supports this mission by funding a portfolio of initiatives that are intended to make a measureable impact in a number of core areas, such as strengthening food security, linking global disease surveillance networks, transforming health systems, and developing climate change resilience. As Chief Investment Officer, Ms. Dean is responsible for leading a team of investment professionals in managing the Rockefeller Foundation’s endowment, which totaled approximately $3.2 billion as of June 30, 2010. Ms. Dean is responsible for establishing strategy for the endowment’s investment program, including diversifying the endowment’s portfolio of investments across a range of asset classes, including public and private equities, fixed income, emerging markets, real assets (such as resources and real estate), hedge funds and distressed debt. Prior to joining the Rockefeller Foundation in 1995, Ms. Dean spent seven years at Yale University, where she served as Director of Investments, with responsibility for real estate as well as oversight of the New Haven Initiative community investment program. From 1984 to 1987, she worked for CIGNA Investments in Hartford, where she managed real estate portfolios in the southeastern United States. From 1978 to 1984, she was with International Paper Company in New York, where she served as Manager of Trust Investments and oversaw the company’s pension and employee benefit funds. Ms. Dean began her career in the national lending division at the Charlotte headquarters of what is now Bank of America. She also serves on the Board of Trustees and Chairs the Investment Committee of Queens University of Charlotte, North Carolina. She also is a member of the Pension Advisory Committee of the New York Stock Exchange.

Randall A. Hack. Mr. Hack is the Senior Managing Director and Founder of Capstone Capital LLC. Capstone Capital holds investments in private companies, with a special focus on the telecommunications and health care industries. He has served as an Advisory Director of Berkshire Partners, a private equity firm, since 2002. In that capacity he assists Berkshire Partners in identifying and assessing private companies in which to invest, participates in those investments through Capstone Capital, and serves on the boards of selected Berkshire Partners portfolio companies. In 1995, Mr. Hack founded Nassau Capital, LLC, a private investment firm which invested in privately held companies and assets solely on behalf of Princeton University’s endowment and Nassau Capital’s principals. Nassau Capital, which grew to manage approximately $2.5 billion in assets at the peak of its investment program, focused its investments in alternative asset classes such as venture capital, leveraged buy-outs, real estate, timber and energy. From 1990 to 1994, Mr. Hack served as the President of The Princeton University Investment Company, which oversees the management of Princeton University’s endowment. In that role, Mr. Hack led a team of investment professionals who devised and implemented a series of global investment initiatives in areas such as domestic and international equities, hedge funds, real estate, oil and gas holdings and other private market asset classes. Mr. Hack began his career in real estate development in 1972 and, through a firm he founded in 1979, focused on the development of commercial space in the Eastern U.S. He currently serves on the boards of FiberTower Corporation, a public company, and Tower Development Corporation, a private company, and on the boards of several non-profit organizations. Mr. Hack has served as a Trustee since his appointment in August of 2010.

How long will each Trustee serve if elected?

If elected, each Trustee will serve until he or she dies, resigns, retires, or is removed from the Board as provided in the Fund’s governing documents, or until his or her successor is elected. A Trustee may be removed from the Board by a shareholder vote representing two-thirds of the outstanding shares of Harbor Funds or by majority action of the Trustees. The Board has also adopted a retirement policy which requires each Independent Trustee to retire from the Board at the end of the year in which the Independent Trustee turns 75. If a nominee is unable to accept election, or subsequently leaves the Board before the next election, the Board may, in its discretion, select another person to fill the vacant position.

What are the backgroundsall of the Trustees who are not standing“interested persons” of the Funds, Harbor Capital, Robeco, Rabobank, ORIX or any Subadviser (the “Independent Trustees”), unanimously voted to approve the new investment advisory agreement for election at this Meeting?

The following table sets forth certain information abouteach Fund and to recommend that the three Trustees who are not standing for election at this Meeting. Messrs. Colhoun, Gould, Smith and Van Hooser have previously been elected by shareholders.

* Mr. Van Hooser is deemed an “Interested Trustee” due to his affiliationshareholders of each Fund vote FOR the approval of the new investment advisory agreement with Harbor Capital effective upon the Adviser and Harbor Funds Distributors, Inc. (the “Distributor”).

What areconsummation of the Board’s responsibilities?

The primary responsibility ofTransaction. For the reasons summarized below, the Board of Trustees concluded that approval of new investment advisory agreements resulting from the Transaction was in the best interest of shareholders. Each new advisory agreement is substantially identical to overseethe Fund’s existing advisory agreement, as discussed in greater detail below.

Prior to its approval of the new advisory agreements, the Board reviewed, among other matters, the quality, extent, and nature of the services currently being provided by Harbor Capital under the existing advisory agreements and the quality, extent, and nature of the services to be provided under the new advisory agreements. A substantial portion of this review was conducted as part of, and in conjunction with, the Board’s annual reviews of the existing advisory agreements, which were most recently approved for continuation at an in-person meeting of the Board held on February 10-12, 2013. During the review process that led to its approval of the existing advisory agreements on February 10-12, 2013, the Board was aware that it likely would be asked in the very near future to consider approval of the new advisory agreements.

On February 10-12, 2013, the Board concluded, in light of all factors it considered, that the approval of the existing advisory agreements was in the best interests of each Fund and its shareholders and that the fee rates set forth in the existing advisory agreements were fair and reasonable. Among other factors, the Board considered: (1) the nature and quality of services provided and to be provided under the existing advisory agreements; (2) the extent to which economies of scale are reflected in fee schedules under the existing advisory agreements; (3) the existence of any “fall-out” benefits to Harbor Capital and its affiliates and third party subadvisers, if applicable; (4) a comparison of fee rates, expense ratios, and investment performance to those of similar funds; and (5) the costs incurred and profits realized by Harbor Capital and its affiliates with respect to their services to each Fund. A further description of the process followed by the Board in approving the continuation of the existing advisory agreements on February 10-12, 2013, including the information reviewed, certain material factors considered, and certain related conclusions reached, is set forth inExhibit G to this Proxy Statement.

In connection with its approval of the new advisory agreements on March 25-26, 2013, the Board considered its conclusions in connection with its February 10-12, 2013 approvals of those existing advisory agreements that were in effect on that date, including the Board’s general satisfaction with the nature and quality of services being provided. Also in connection with its March 25-26, 2013 approvals of the new advisory agreements, the Board considered assurances from Harbor Capital that it was aware of no additional developments unrelated to the Transaction and not already disclosed to the Board since February 10-12, 2013 that would be a material consideration to the Board in connection with its consideration of the new advisory agreements. Therefore, in considering the new advisory agreements, the Board focused its review on, and requested and evaluated other information relating to, the potential impact of the Transaction on the operations, personnel, organizational structure, capitalization, and financial and other resources of Harbor Capital and their affiliates that render advisory, administrative, distribution, compliance, and other services to the Funds. When making

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its decisions on March 25-26, 2013, the Board took into account that, commencing in June of 2012, it had posed ongoing inquiries to, and received regular updates from, Harbor Capital and Robeco relating to the Transaction.

Between November 2012 and the March 25-26, 2013 special meeting, the Board accelerated its due diligence processes by engaging in an extensive review and analysis of additional information regarding the proposed Transaction and related matters. This analysis focused on, among other matters, the expectations for continuity and stability of Harbor Capital throughout implementation of the Transaction and thereafter. In this connection, the Board generally has been satisfied with the nature and quality of the services provided to the Funds, including investment advisory, administrative, and support services, and has decided that it would be in the Funds’ best interests to maintain continuity and stability of the services currently being provided. The Board carefully considered Harbor Capital’s anticipated future plans related to operational matters and levels of staffing and related compensation structures.

Among other steps in its due diligence process, the following actions were taken and considered by or on behalf of the Board:

1.        The Independent Trustees solicited and received ongoing advice regarding the Board’s legal duties from independent legal counsel for such Board members, which counsel has extensive experience regarding such matters.

2.        The Independent Trustees oversaw, coordinated, and performed due diligence activities with respect to a list of issues and topics they considered appropriate.

3.        The Independent Trustees, with assistance from their legal counsel, prepared written requests for information from both Harbor Capital and ORIX regarding the Transaction, including details regarding each entity’s anticipated business plan for continuing operations after the Transaction.

4.        The Board received and evaluated written responses from Harbor Capital and ORIX pursuant to inquiries made on the Board’s behalf. The Board requested and participated in a series of in-person and telephonic meetings involving presentations from senior management personnel at Harbor Capital, including its Chief Executive Officer, as well as from senior management of Robeco, including its Chief Executive Officer and Chief Financial Officer. In certain sessions, the Independent Trustees met alone with only their legal counsel present.

5.        The Independent Trustees and the Board held in-person meetings on March 25-26, 2013 during which, among other actions, they received a formal presentation from senior management of ORIX, including its Chief Operating Officer, and of Robeco, including its Chief Executive Officer and Chief Financial Officer, engaged in a dialogue with and posed questions to such management personnel, evaluated the responsive due diligence information earlier provided by ORIX, Robeco and Harbor Capital, and considered input from legal counsel.

6.        At the March 25-26, 2013 special meeting, the Independent Trustees requested and received assurances that: (i) Harbor Capital and its affiliates are committed to maintaining appropriate levels of overall staffing, ongoing resources and service quality; (ii) Harbor Capital and the subadvisers can be expected to provide services of the same nature, extent, and quality under the new advisory agreements as are provided thereby under the existing advisory agreements; and (iii) the Transaction is not expected to result in any material changes to (a) the management of the Funds, including the continuity of the Funds’ portfolio managers, administrative and compliance personnel and other personnel responsible for the benefitmanagement and operations of the Funds, or (b) the investment objective of or the principal investment strategies used to manage any of the Funds. In this regard, the Board considered representations by Harbor Capital and its affiliates that Robeco’s ownership by ORIX as contemplated by the Transaction would not lead to a reduction in the quality or scope of these and other services provided to the Funds.

7.        At the March 25-26, 2013 special meeting, the Board also requested and received written undertakings relating to certain financial resources to be available to Harbor Capital and the Funds following the closing of the Transaction. Specifically, these undertakings relate to: (i) Harbor Capital’s current seed capital investments in the Funds; (ii) appropriate seed capital for any funds approved in the future; and (iii) adequate levels of working capital within Harbor Capital.

8.        The Board considered representations by Harbor Capital and its affiliates, as well as related supporting documentation and advice from legal counsel, indicating that the new advisory agreements are substantially similar to and, in any event, are no less favorable to the Funds than, the terms of the corresponding existing advisory agreements (including the fees payable thereunder).

9.         The Board considered that, to the extent that the new advisory agreements differ from the existing agreements, those differences are designed to modernize certain provisions and clarify or confirm current understandings and arrangements on terms no less favorable to the Funds than the existing advisory agreements.

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10.        The Board considered that Harbor Capital, Rabobank and ORIX and its affiliates have agreed to bear the expenses associated with obtaining Board and shareholder approval of the new advisory agreements and that the Funds will bear no costs associated with the Transaction.

11.        The Board considered the advice provided by legal counsel with respect to the new advisory agreements (including advice relating to the process and timing of seeking shareholder approval of the new advisory agreements).

12.        The Board considered acknowledgements from ORIX and Robeco of the importance of Harbor Capital continuing to be able to operate independently and in the interests of Fund shareholders.

13.        The Board considered the potential benefits that may be realized by Harbor Capital and its affiliates as a result of the continuation of their relationship with the Funds by the new advisory agreements.

14.        The Board considered that, if shareholders approve the new advisory agreements, the Board currently expects to continue to conduct a formal annual contracts review and renewal process consistent with the process it would have conducted had the existing advisory agreements continued in effect and not been replaced by the new advisory agreements, notwithstanding the two-year initial term of the new advisory agreements. For example, if the existing advisory agreements are approved by shareholders in 2013, the Board would not legally be required to review or renew those contracts until 2015. However, the Board currently intends to conduct annual reviews of such contracts, and Harbor Capital has consented to this process. If the Board conducts its future annual reviews in accordance with its customary contracts renewal cycle in recent years, the next annual reviews would be conducted in February 2014. Thus, the Board emphasized that it would be able to, and intends to, monitor on a regular basis the ability of Harbor Capital and its affiliates to comply with their undertakings to the Board and to monitor on an ongoing basis the quality of services to, and expenses of, the Funds. In addition, the Board considered that, under the new advisory agreements, it will continue to have the authority, should the need arise in its view, to terminate any of the new advisory agreements without penalty upon 60 days’ notice.

Based on the foregoing and other relevant considerations, at the special meeting of the Board held on March 25-26, 2013, the Board, including all of the Independent Trustees, voted to approve the new advisory agreements and to recommend approval of the new advisory agreements by shareholders of the Funds. In this connection, the Board concluded that, in light of all factors considered, the terms of the new advisory agreements, including fee rates, were fair and reasonable, and that it would be in the best interests of shareholders of each Fund to approve the new advisory agreements so as to enable there to be a continuation without interruption of the current services being provided by the current service providers pursuant to the existing advisory agreements. In this connection, the Board noted that no one factor was determinative of its decisions which, instead, were premised upon the totality of factors considered. In this connection, the Board also noted that different Trustees likely placed emphasis on different factors in reaching their individual conclusions to vote in favor of the new advisory agreements and to recommend approval of the new advisory agreements to shareholders.

If the shareholders of a particular Fund do not approve the new advisory agreement with respect to that Fund and the Transaction is consummated, the Trustees would consider what further action to take consistent with their fiduciary duties to that Fund. Such action would initially include obtaining for the Fund interim investment advisory services (at no more than the current fee rate for up to 150 days following the Transaction) from Harbor Capital. Thereafter, the Trustees would either negotiate a new advisory agreement with an advisory organization selected by the Trustees or make other appropriate arrangements. In the event the Transaction is not consummated, Harbor Capital would continue to serve as investment adviser of the Funds pursuant to the terms of the existing advisory agreements.

Terms of the Existing and New Advisory Agreements

This section summarizes the terms of each new advisory agreement and the material differences between the terms of each new advisory agreement and the terms of the corresponding existing advisory agreement. As part of a larger effort to update and achieve more consistent advisory agreements across the Funds, each new advisory agreement also reflects certain other non-material differences from the corresponding existing advisory agreement not discussed below.

As set forth in more detail in the summary of terms below, the terms of each Fund’s new advisory agreement are substantially identical to the terms of that Fund’s existing advisory agreement, except for: (i) the inclusion of a description of the administrative services Harbor Capital has provided to each Fund since Harbor Capital began managing the Funds; (ii) a statement that Harbor Capital is responsible for all expenses it incurs in the performance of its duties under the advisory agreement; (iii) language stating that Harbor Capital will monitor a subadviser’s portfolio management and report to the Board periodically on the subadviser’s performance (this language is not applicable to the Target Retirement Funds);

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(iv) language stating that if the new advisory agreement is terminated on any date other than the last day of the month, fees for such month will be prorated (this language is not applicable to the Target Retirement Funds as these funds do not pay advisory fees); (v) language delineating that amendments to the agreement require shareholder approval only if required by the Investment Company Act; (vi) language clarifying that in the event of a conflict between the applicable provisions of the Investment Company Act requires specificand state law, the provisions of the Investment Company Act will apply; (vii) the dates of execution, effectiveness and termination; (viii) for certain Funds (those for which the existing advisory agreement designates Ohio as the governing law of the agreement), a change in the state specified in the choice of law provision from Ohio to Illinois; and (ix) for certain Funds (those for which the existing advisory agreement does not contain such a provision), addition of a provision specifically setting forth Harbor Capital’s confidentiality obligations. The stated rates of the advisory fees payable by the Funds are identical under the new advisory agreements and the existing advisory agreements.

The following summary of the new advisory agreements is qualified by reference to the representative form of the new advisory agreement attached to this proxy statement asExhibit A. Because the new advisory agreements are substantially similar, only one representative new advisory agreement for the Funds is included asExhibit A. The agreements for the Target Retirement Funds and Harbor Commodity Real Return Strategy Fund do, however, differ in certain respects from the agreements for the other Funds, and these differences are identified inExhibit A. The contractual rate(s) of the advisory fee payable by each Fund to Harbor Capital is set forth inExhibit B. The date on which each existing advisory agreement was most recently submitted to shareholders for approval and the purpose for such submission is set forth inExhibit C. Information regarding Harbor Capital, its other investment company clients, and fees paid by the Funds to its affiliates is included inExhibit D to this proxy statement.

Management Services.The investment advisory services to be provided by Harbor Capital to each Fund under the new advisory agreements are substantially identical to those provided currently by Harbor Capital under the Funds’ existing advisory agreements. Pursuant to the terms of each new advisory agreement, Harbor Capital would continue to provide each Fund with investment research, advice and supervision, and would continuously furnish an investment program for each Fund consistent with the investment objectives and policies of the Fund.

In addition to the foregoing management oversight services, the new advisory agreements include a description of the administrative services provided by Harbor Capital to each Fund. Harbor Capital has provided these services to each Fund since Harbor Capital began managing the Funds, but no description of these services is included in the existing advisory agreements. The new advisory agreements specify that Harbor Capital would regularly provide, or cause one of its affiliates to provide, the following administrative services: (i) provide the Funds with office space, facilities, equipment and personnel as Harbor Capital deems necessary to provide for the effective administration of the affairs of the Funds, including providing from among Harbor Capital’s directors, officers and employees, persons to serve as Trustees, officers and employees of Harbor Funds and paying the salaries of such persons; (ii) coordinate and oversee the services provided by the Funds’ transfer agent, custodian, legal counsel and independent auditors; (iii) coordinate and oversee the preparation and production of meeting materials for the Trustees, as well as such other materials as the Trustees may from time to time reasonably request; (iv) coordinate and oversee the preparation and filing with the SEC of registration statements, notices, shareholder reports, proxy statements and other material for the Funds required to be filed under applicable laws; (v) develop and implement procedures for monitoring compliance with the Funds’ investment objectives, policies and guidelines and with applicable regulatory requirements; (vi) provide legal and regulatory support for the Funds in connection with the administration of the affairs of the Funds, including the assignment of matters to the Funds’ legal counsel on behalf of the Funds and supervising the work of such outside counsel; (vii) oversee the determination and publication of each Fund’s net asset value in accordance with the Funds’ valuation policies; (viii) prepare and monitor expense budgets for the Funds, and review the appropriateness and arrange for the payment of Fund expenses; and (ix) furnish to the Funds such other administrative services as Harbor Capital deems necessary, or the Trustees reasonably request, for the efficient operation of the Funds.

Hiring of Subadvisers. The new advisory agreements for all Harbor Funds except the Target Retirement Funds specifically permit Harbor Capital to continue to enter into subadvisory agreements with Subadvisers to whom Harbor Capital may delegate its responsibility for providing investment advice and making investment decisions for the particular Fund or a portion thereof. Harbor Capital would continue to retain the responsibility to both oversee the Subadvisers which it selects and to recommend to Harbor Funds’ Board of Trustees the hiring, termination and replacement of subadvisers. To explicitly reflect Harbor Capital’s existing responsibilities and activities with respect to subadviser oversight, the new advisory agreements for all Harbor Funds except the Target Retirement Funds state that Harbor Capital would monitor a subadviser’s portfolio management and report to the Board periodically on the subadviser’s performance.

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Allocation of Charges and Expenses.A new sentence has been added to the new advisory agreements making explicit that Harbor Capital is responsible for all expenses it incurs in the performance of its duties under the new advisory agreements. With the exception of that statement, the new advisory agreements contain provisions regarding the allocation of charges and expenses that are identical to the corresponding existing advisory agreements. As described below, the agreements for the Target Retirement Funds differ from those of the other Funds with respect to allocation of charges and expenses.

Harbor Funds Other Than Target Retirement Funds. Under the new advisory agreement for each such Fund, Harbor Capital, at its own expense, would continue to furnish to each Fund office space and provide investment advisory, research and statistical facilities and all clerical services relating to research, statistical and investment work. In addition, Harbor Capital would continue to pay the compensation and expenses of all officers and executive employees of the Funds and would make available, without expense to the Funds, the services of such of Harbor Capital’s directors, officers and employees as may duly be elected officers or Trustees of Harbor Funds, subject to their individual consent to serve and to any limitations imposed by law.

The new advisory agreements for each such Fund would continue to provide that Harbor Capital is not required to pay any expenses of the Funds other than those specifically allocated to Harbor Capital in the agreement. Specifically, the new advisory agreements would continue to provide that the expenses borne by the Funds include: (i) organization expenses of the Funds; (ii) clerical salaries; (iii) fees and expenses incurred by the Funds in connection with membership in investment company organizations; (iv) brokers’ commissions; (v) payment for portfolio pricing services to a pricing agent, if any; (vi) legal, auditing or accounting expenses; (vii) taxes or governmental fees; (viii) the fees and expenses of the Funds’ transfer agent; (ix) the cost of preparing share certificates or any other expenses, including clerical expenses of issue, redemption or repurchase of shares of beneficial interest of the Funds; (x) the expenses of and fees for registering or qualifying securities for sale and of maintaining the registration of Harbor Funds and registering Harbor Funds as a broker or a dealer; (xi) the fees and expenses of Trustees of Harbor Funds who are not affiliated with Harbor Capital; (xii) the cost of preparing and distributing reports and notices to shareholders; (xiii) the fees or disbursements of custodians of the Funds’ assets, including expenses incurred in the performance of any obligations enumerated by the Declaration of Trust or By-Laws of Harbor Funds insofar as they govern agreements with any such custodian; or (xiv) litigation and indemnification expenses and other extraordinary expenses not incurred in the ordinary course of the Funds’ business. The new advisory agreements would also continue to provide that Harbor Capital is not required to pay expenses of activities which are primarily intended to result in sales of shares of the Funds if and to the extent that such expenses are (i) required to be paid by the Funds’ distributor pursuant to the Funds’ underwriting agreement; or (ii) permitted to be paid by the Funds pursuant to a plan adopted under Rule 12b-1 under the Investment Company Act.

Target Retirement Funds. The new advisory agreement for the Target Retirement Funds would continue to provide that Harbor Capital would pay all expenses involved in the operation of the Funds, except the following, which are paid by the Funds: brokers’ commissions; the fees and expenses of Trustees of Harbor Funds who are not affiliated with Harbor Capital; and litigation and indemnification expenses and other extraordinary expenses not incurred in the ordinary course of the Funds’ business. The new advisory agreements would also continue to provide that Harbor Capital is not required to pay expenses of activities which are primarily intended to result in sales of shares of the Funds if and to the extent that such expenses are (i) required to be paid by the Funds’ distributor pursuant to the Funds’ underwriting agreement; or (ii) permitted to be paid by the Funds pursuant to a plan adopted under Rule 12b-1 under the Investment Company Act.

The costs associated with the Transaction, including the costs associated with calling this Meeting and the solicitation of proxies to be voted at the Meeting, are not being borne by the Funds, but are being borne by Rabobank, ORIX and/or Harbor Capital.

Investment Advisory Fees. For its services, Harbor Capital (i) would continue to be entitled to an investment advisory fee from each Fund other than the Target Retirement Funds, and (ii) would continue to receive no fee for the advisory and administrative services rendered to the Target Retirement Funds. The method and rate for calculating each Fund’s (other than the Target Retirement Funds) investment advisory fee would be the same under each Fund’s new advisory agreement as under its existing advisory agreement with the exception that language has been added to each new advisory agreement stating that if the new advisory agreement is terminated on any date other than the last day of the month, fees for such month would be prorated. This new language confirms the existing understanding between the Funds and Harbor Capital and is consistent with their prior course of dealing (e.g., terminations resulting from liquidation of a fund). If each new advisory agreement had been in effect for each Fund’s most recently completed fiscal year, the amount of investment

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advisory fees payable to Harbor Capital by each Fund would have been identical to those payable under the corresponding existing investment advisory agreement with Harbor Capital.There would be no increase in the investment advisory fee rates under the new agreements.

Each Fund other than the Target Retirement Funds would continue to pay Harbor Capital a fee computed at a fixed annual percentage rate based upon the Fund’s average daily net assets. The rates for calculating each Fund’s investment advisory fee, which are the same under the existing and the new advisory agreements, are set forth inExhibit B to this proxy statement. The fee would be computed and paid monthly. Under the new advisory agreement for Harbor Commodity Real Return Strategy Fund, Harbor Capital would continue to reduce the advisory fee payable by the Fund in a given month by the amount of any advisory fee payable to Harbor Capital during the same month with respect to Harbor Capital’s service as investment adviser to a pooled investment vehicle treated as a Controlled Foreign Corporation under the Internal Revenue Code in which the Fund may invest in order to implement its investment strategy.

Although not explicitly addressed in the new or existing advisory agreements, Harbor Capital may from time to time continue to agree not to impose all or a portion of its fee and/or limit the total operating expenses for certain Funds. Any such fee waiver or expense limitation may be a contractual agreement for a specified time period or may be voluntary and therefore discontinued or modified by Harbor Capital at any time. Harbor Capital has represented to the Board of Trustees that Harbor Capital would not modify or terminate any of the voluntary fee waivers or expense limitations currently in effect through February 28, 2014.

The aggregate amount of investment advisory fees incurred by each Fund for its most recently completed fiscal year, and the amount of any advisory fees waived pursuant to any voluntary or contractual fee waiver or expense limitation then in effect, are set forth inExhibit C to this proxy statement.

Amendment. Unlike the existing advisory agreements, the new advisory agreements contain language delineating that amendments to the agreement require shareholder approval only if required by the Investment Company Act. Specifically, each new advisory agreement provides that no amendment of the agreement shall be effective until approved by vote of the Trustees, including a majority of the Trustees who are not interested persons of Harbor Capital or of Harbor Funds, cast in person at a meeting called for the purpose of voting on such approval and, if required by the Investment Company Act, until also approved by vote of the holders of a majority of the outstanding voting securities of the Fund.

Choice of Law.Each new advisory agreement provides that the agreement shall be governed by and construed in accordance with the laws of the State of Illinois, without giving effect to the choice of law principles thereof, and the Investment Company Act. This is different from the existing advisory agreements for certain Funds. Specifically, the existing advisory agreements for Harbor Commodity Real Return Strategy Fund, Harbor Convertible Securities Fund, Harbor Emerging Markets Debt Fund, Harbor Global Growth Fund, Harbor Unconstrained Bond Fund, and the Target Retirement Funds provide for the application of Illinois law, while the agreements for the remaining Funds provide for the application of Ohio law.

Each new advisory agreement, unlike each existing advisory agreement, also specifically provides that, to the extent that the applicable laws of the State of Illinois conflict with the applicable provisions of the Investment Company Act, the latter shall control.

Confidentiality.Each new advisory agreement contains a provision explicitly imposing confidentiality obligations on Harbor Capital and prohibiting Harbor Capital from using non-public information regarding a Fund’s portfolio as a basis to place or recommend any securities transactions for itself or a third party. Certain of the existing advisory agreements contain a confidentiality provision while others of the older agreements do not. Specifically, the agreements for the following Funds do not contain such a provision: Harbor Bond Fund, Harbor Capital Appreciation Fund, Harbor High-Yield Bond Fund, Harbor International Fund, Harbor International Growth Fund, Harbor Large Cap Value Fund, Harbor Mid Cap Growth Fund, Harbor Mid Cap Value Fund, Harbor Money Market Fund, Harbor Small Cap Growth Fund, and Harbor Small Cap Value Fund.

Other Provisions Under the Existing and New Advisory Agreements

Standard of Care. Under each new advisory agreement, Harbor Capital would continue not to be liable for any error of judgment, mistake of law or for any loss sustained in connection with the performance of its duties under the agreement; but nothing contained in the agreement protects Harbor Capital against any liability to the Fund or its shareholders by reason of willful misfeasance, bad faith or gross negligence on the part of Harbor Capital in the performance of its duties, or by reason of its reckless disregard of its obligations and duties under the investment advisory agreement. The existing advisory agreements include the same provisions.

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Portfolio Trading. Each new advisory agreement continues to expressly permit Harbor Capital to engage in portfolio trading. However, each Subadviser is responsible for effecting all portfolio trading decisions for each Fund, except for the Target Retirement Funds where Harbor Capital selects underlying Funds for investment.

Miscellaneous

If approved by shareholders, each Fund’s new advisory agreement would become effective upon the consummation of the Transaction and would have an initial period of two years. Thereafter, each new advisory agreement would continue from year to year subject to annual approval by the Board of Trustees of a number of types of arrangements, transactions and activities ofin the Funds. The Board also has general fiduciary and oversight responsibilities arising undersame manner as the existing investment advisory agreement. Each Fund’s new advisory agreement terminates if assigned (as defined in the Investment Company ActAct) and state law. In exercising their oversight responsibilities,may be terminated without penalty by the Trustees, place special focus on matters they determine to be particularly important to Fund shareholders. This includes not only the management and performanceby a vote of a majority of the Funds but also expenses borneoutstanding voting securities of the Fund, or by Harbor Capital, each upon 60 days’ written notice.

As noted above, notwithstanding the initial two-year period of the new advisory agreements, the Board currently expects to continue to conduct a formal annual contracts review and renewal process for 2014 consistent with the process it would have conducted had the existing advisory agreements continued in effect and not been replaced by the Funds, strategic plans, and performance evaluations ofnew advisory agreements.

Information Concerning Harbor Capital Advisors and each subadviser.

The Board considers the business acumen, experience, and objective thinking of Harbor Funds’ Independent Trustees to be extremely important to the Funds’ shareholders as the Independent Trustees have responsibility for overseeing the activities of Harbor Capital Advisors, the subadvisers of the Funds, and other Fund service providers. It is important that the adviser, subadvisers and service providers to the Funds remain accountable to a group of independent, highly experienced, and qualified individuals acting solely on behalf of Fund shareholders.

The Board has an Audit Committee and Nominating Committee. All Independent Trustees (Messrs. Ball, Colhoun, Gould, Hack and Smith) serve on the Audit Committee and Nominating Committee. Mr. Ball serves as the Chair of the Audit Committee. The functions of the Audit Committee include recommending independent auditors to the Board, monitoring the independent auditors’ performance, reviewing the results of audits and responding to certain other matters deemed appropriate by the Trustees. The Nominating Committee is responsible for the selection and nomination of candidates to serve as Independent Trustees. As discussed below, the Independent Trustees will also consider nominees recommended by shareholders to serve as Trustees provided that shareholders submit such recommendations in writing within a reasonable time before any meeting. The Board does not have a Compensation Committee.

During the most recently completed fiscal year for Harbor Funds (ending October 31, 2009), the Board of Trustees held 12 Board meetings and the Audit Committee and Nominating Committee held 1 and 3 meetings, respectively. The Trustees attended all meetings of the Board of Trustees and all Committee meetings during the most recently completed fiscal year. In carrying out its work to identify and select potential independent Trustee candidates to serve on the Board, the Nominating Committee met as a committee 11 times during the period November 1, 2009 through September 30, 2010.

How might shareholders communicate with the Board?

Shareholders wishing to communicate with members of the Board of Trustees may submit a written communication directed to the attention of the Board of Trustees, Harbor Funds, c/o Secretary of the Harbor Funds, 111 South Wacker Drive, 34th Floor, Chicago, Illinois 60606.

What criteria does the Nominating Committee follow in considering candidates for the position of Independent Trustee?

The Trustees have adopted a written charter for the Nominating Committee (the “Charter”), a copy of which is included as Exhibit A to this proxy statement. As set forth in Annex A to the Charter, the Nominating Committee expects that any candidate for nomination as an Independent Trustee will have certain qualifications, which are described in Annex A to the Charter. Nonetheless, the Nominating Committee may determine that a candidate who does not have a particular type of previous experience or knowledge referred to in Annex A to the Charter should be considered as a nominee if the Nominating Committee finds that the candidate has other qualifications such that his or her qualifications, taken as a whole, demonstrate the requisite level of fitness to serve as an Independent Trustee. In addition, the Nominating Committee believes it is desirable that at least one Independent Trustee be an “audit committee financial expert,” as such term is defined by the Securities and Exchange Commission, whenever it is reasonably practicable.

The Nominating Committee will review and consider nominees recommended by shareholders to serve as Trustee, provided that the recommending shareholder follows the procedures set forth in the Charter. Among other requirements, these procedures provide that the recommending shareholder must submit any recommendation in writing to the Secretary of the Harbor Funds, c/o Harbor Funds, 111 South Wacker Drive, 34th Floor, Chicago, Illinois 60606. Any recommendation must include certain biographical and other information regarding the candidate and the candidate’s written consent to being named in the proxy statement as a nominee and to serve as a Trustee (if elected). The foregoing description is only a summary of these procedures. Please refer to Exhibit A for details.

When the Nominating Committee seeks to identify Independent Trustee candidates, it considers both individuals known to them and individuals recommended to them by others, among other methods of identifying candidates. The Nominating Committee may also, from time to time, engage the services of a third-party search firm to identify and screen suitable prospective Trustee candidates. A third-party search firm hired to identify prospective candidates recommended Mr. Hack and Ms. Dean to the Nominating Committee, while an Independent Trustee recommended Mr. Ball to the Nominating Committee. In evaluating nominees, the Nominating Committee considers, among other factors, the qualifications set forth in the Charter, and evaluates candidates submitted by shareholders according to the same criteria as other Independent Trustee candidates.

Do the Trustees own shares of the Funds?

All of the existing Trustees own shares of the Funds. The following table shows the Fund share ownership information for each Trustee and nominee as of October 4, 2010. Ms. Dean, pursuant to a share ownership policy approved by the Board, would be expected to own additional shares of the Funds within a reasonable period of time after joining the Board.

How are the Trustees compensated?

The Independent Trustees are compensated by Harbor Funds for their service on the Board. The Independent Trustees receive an annual fee for their service and are reimbursed for the travel and other expenses they incur in attending Board meetings and attending other events, such as educational seminars, that are directly related to their service on the Board. Mr. Van Hooser, who is an employee of Harbor Capital Advisors, does not receive any compensation from Harbor Funds for his service as Trustee or officer of Harbor Funds. The following table sets forth the compensation details for each Trustee as of the Funds’ most recent fiscal year end of October 31, 2009. Effective November 1, 2009, the annual fee for the Independent Trustees was increased from $115,000 to $160,000. The chairman of the Audit Committee receives an additional $10,000 annually for his service in that role.