TIAA CREF INSTITUTIONAL MUTUAL FUNDS, N-1A, 1999-04-20

TIAA CREF INSTITUTIONAL MUTUAL FUNDS
N-1A, 1999-04-20

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<PAGE> 1
File Nos. 333-_____, 811-_____

As filed with the Securities and Exchange Commission on April 20, 1999

U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. __ [ ]
Post-Effective Amendment No. __ [ ]
and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. __ [ ]
(Check appropriate box or boxes.)

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

TIAA-CREF INSTITUTIONAL MUTUAL FUNDS
(Exact Name of Registrant as Specified in Charter)

730 Third Avenue
New York, New York 10017-3206
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: (800) 842-2733

Peter C. Clapman, Esq.
TIAA-CREF Institutional Mutual Funds
730 Third Avenue
New York, New York 10017-3206
(Name and Address of Agent for Service)

Copy to:
Steven B. Boehm, Esq.
Sutherland Asbill & Brennan LLP
1275 Pennsylvania Avenue, N.W.
Washington, D.C. 20004-2415

Approximate Date of Proposed Public Offering:
July 1, 1999

The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission acting pursuant to said Section 8(a),
may determine.

<PAGE> 2

PROSPECTUS, DATED JULY _____, 1999

TIAA-CREF Institutional Mutual Funds

Institutional International Equity Fund
Institutional Growth Equity Fund
Institutional Growth and Income Fund
Institutional Equity Index Fund
Institutional Social Choice Equity Fund
Institutional Bond Fund
Institutional Money Market Fund

Each investment portfolio, or "Fund," currently offers a single class of shares,
which is described in this prospectus. The shares are only available for
purchase by certain intermediaries affiliated with TIAA-CREF ("TIAA-CREF
Intermediaries") or other persons, such as state-sponsored tuition savings
plans, who have entered into a contract with a TIAA-CREF Intermediary that
enables them to purchase shares of the 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.

<PAGE> 3

TABLE OF CONTENTS

<TABLE>
<S> <C>
SUMMARY INFORMATION...............................................................................................1
INVESTMENT OBJECTIVES, STRATEGIES AND RISKS..............................................................1
Institutional International Equity Fund.........................................................2
Institutional Growth Equity Fund................................................................3
Institutional Growth and Income Fund............................................................4
Institutional Equity Index Fund.................................................................5
Institutional Social Choice Equity Fund.........................................................5
Institutional Bond Fund.........................................................................6
Institutional Money Market Fund.................................................................7
PAST PERFORMANCE.........................................................................................7
FEES AND EXPENSES........................................................................................7

INVESTMENT OBJECTIVES, STRATEGIES AND RISKS.......................................................................8
EQUITY FUNDS USING THE DUAL INVESTMENT MANAGEMENT STRATEGY(SM)...........................................9
Institutional International Equity Fund........................................................10
Institutional Growth Equity Fund...............................................................10
Institutional Growth and Income Fund...........................................................11
OTHER EQUITY FUNDS......................................................................................12
Institutional Equity Index Fund................................................................12
Institutional Social Choice Equity Fund........................................................12
ADDITIONAL INVESTMENT STRATEGIES FOR THE EQUITY FUNDS...................................................13
THE FIXED-INCOME FUNDS..................................................................................14
Institutional Bond Fund........................................................................14
Institutional Money Market Fund................................................................16
RISKS OF INVESTING IN ANY OF THE FUNDS..................................................................17
General Investment Risks.......................................................................17
Year 2000 Risks................................................................................17
MANAGEMENT OF THE FUNDS.................................................................................18
The Funds' Investment Adviser..................................................................18
Prior Performance of Investment Adviser........................................................19
Fund Managers..................................................................................20
Service Providers..............................................................................21

CALCULATING SHARE PRICE..........................................................................................21

DIVIDENDS AND DISTRIBUTIONS......................................................................................22

TAXES............................................................................................................23

YOUR ACCOUNT: BUYING, SELLING OR EXCHANGING SHARES..............................................................24
ELIGIBLE INVESTORS......................................................................................24
PURCHASE OF FUND SHARES.................................................................................24
</TABLE>

<PAGE> 4

<TABLE>
<S> <C>
Purchases by Eligible Investors................................................................25
Investing through the Trust Company............................................................25
Points to Remember for All Purchases...........................................................25
In-Kind Purchases of Shares....................................................................26
HOW TO REDEEM SHARES....................................................................................26
Redemptions by Eligible Investors..............................................................26
Redeeming Shares through the Trust Company.....................................................27
In-Kind Redemptions of Shares..................................................................27
HOW TO EXCHANGE SHARES..................................................................................27
Exchanges by Eligible Investors................................................................27
Making Exchanges through the Trust Company.....................................................28
OTHER INVESTOR INFORMATION..............................................................................28

FINANCIAL HIGHLIGHTS.............................................................................................29
</TABLE>

iii
<PAGE> 5

SUMMARY INFORMATION

INVESTMENT OBJECTIVES, STRATEGIES AND RISKS

TIAA-CREF Institutional Mutual Funds consists of seven different Funds:

The Institutional International Equity Fund, the Institutional Growth
Equity Fund, and the Institutional Growth and Income Fund use TIAA-CREF's Dual
Investment Management Strategy(SM). Each of these Funds has a "stock selection"
and an "enhanced index" segment. The stock selection segment holds a relatively
small number of stocks that the Fund manager believes offer superior returns.
These stocks are chosen using fundamental analysis. The rest of the Fund is
invested in its enhanced index segment, which seeks to outperform the Fund's
benchmark index while limiting the possibility of significantly underperforming
the benchmark. This approach enables the Funds to stay fully invested even when
the Fund manager cannot find sufficient investment opportunities for the stock
selection segment.

The Funds are subject to the following general risks:

- - Market Risk -- Stock and bond prices in general can decline over short or
extended periods as a result of political or economic events.

- - Company Risk -- A company's current earnings can fall or its overall
financial soundness may decline. As a result, the price of its stock may
go down, or the company may not be able to pay principal and interest on
its bonds when due.

- - Interest Rate Risk -- Bond or stock prices may decline if interest rates
change.

- - Current Income Volatility -- Your income from an investment in a Fund may
fall as a result of overall interest rate changes.

An investment in TIAA-CREF Institutional Mutual Funds is not a deposit of
any bank and is not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency. An investor can lose money in any of
the Funds, or the Funds could underperform other investments.

Special risks associated with particular Funds are discussed in the
following Fund summaries. The use of a particular benchmark index by a Fund is
not a fundamental policy and

<PAGE> 6

can be changed.

INSTITUTIONAL INTERNATIONAL EQUITY FUND

INVESTMENT The Fund seeks favorable long-term returns, mainly through
OBJECTIVE capital appreciation.

BENCHMARK Morgan Stanley Capital International ("MSCI") EAFE(R)
INDEX (Europe, Australia, Far East) Index.

PRINCIPAL The Fund invests in a broadly diversified portfolio of
INVESTMENT primarily foreign equity investments. For the Fund's stock
STRATEGIES selection segment, we select individual stocks and let the
Fund's country and regional asset allocation evolve from
that stock selection. We look for companies that meet a
number of criteria including sustainable growth, consistent
cash flow and attractive stock prices based on current
earnings, assets and long-term growth prospects.

SPECIAL Changes in currency exchange rates, the possible imposition
INVESTMENT of market controls or currency exchange controls, lower
RISKS liquidity and higher volatility in some foreign markets
and/or political, social or diplomatic events could reduce
the value of the Fund's investments.

WHO MAY The Fund may be appropriate for investors who seek
WANT TO above-average long-term returns, who understand the
INVEST advantages of diversification across international markets
and are willing to tolerate the greater risks of
international investing.

2
<PAGE> 7

INSTITUTIONAL GROWTH EQUITY FUND

INVESTMENT The Fund seeks a favorable long-term return, mainly through
OBJECTIVE capital appreciation, primarily from a diversified portfolio
of common stocks that present the opportunity for
exceptional growth.

BENCHMARK Russell 3000(R) Growth Index. (Russell 3000 is a trademark
INDEX and a service mark of the Frank Russell Company.)

PRINCIPAL The Fund invests in stocks of companies in new and emerging
INVESTMENT areas of the economy and companies with distinctive
STRATEGIES products or promising market conditions. For its stock
selection segment, the Fund looks for companies that we
believe have the potential for strong earnings or sales
growth, or that appear to be undervalued based on current
earnings, assets or growth prospects. It can invest in
companies to benefit from prospective acquisitions,
reorganizations, or corporate restructurings or other
special situations. Foreign investments can be up to 40
percent of the Fund's portfolio.

SPECIAL The Fund may sometimes hold a significant amount of stocks
INVESTMENT of smaller, lesser-known companies whose stock prices may
RISKS fluctuate more than those of larger companies. This means
the Fund will probably be more volatile than the overall
stock market, and could significantly outperform or
underperform the market. With foreign investments, changes
in currency exchange rates, the possible imposition of
market controls or currency exchange controls, lower
liquidity and higher volatility in some foreign markets
and/or political, social or diplomatic events could reduce
the value of the Fund's investments.

WHO MAY The Fund may be appropriate for investors who are looking
WANT TO for long-term capital appreciation, but who are willing to
INVEST tolerate fluctuations in value.

3
<PAGE> 8

INSTITUTIONAL GROWTH AND INCOME FUND

INVESTMENT The Fund seeks a favorable long-term return through capital
OBJECTIVE appreciation and investment income.

BENCHMARK Standard & Poor's 500 ("S&P 500") Index.
INDEX

PRINCIPAL The Fund invests in a broadly diversified portfolio of
INVESTMENT common stocks selected for their investment potential. For
STRATEGIES its stock selection segment, the Fund manager looks
primarily for stocks of larger, well-established, mature
growth companies that we believe are attractively priced,
show the potential to grow faster than the rest of the
market, and offer a growing stream of dividend income. The
Fund may also invest in rapidly growing smaller companies
and may have up to 20 percent of its assets in foreign
securities. Normally, at least 80 percent of the Fund's
assets will be income-producing equity securities selected
for their investment potential.

SPECIAL Stocks paying relatively high dividends may at times
INVESTMENT significantly underperform other stocks during periods of
RISKS rapid market appreciation. Changes in currency exchange
rates, the possible imposition of market controls or
currency exchange controls, lower liquidity and higher
volatility in some foreign markets and/or political, social
or diplomatic events could reduce the value of the Fund's
foreign investments.

WHO MAY The Fund may be appropriate for investors who want capital
WANT TO appreciation and current income but who also can accept the
INVEST risk of market fluctuations.

4
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INSTITUTIONAL EQUITY INDEX FUND

INVESTMENT The Fund seeks a favorable long-term rate of return from a
OBJECTIVE diversified portfolio selected to track the overall market
for common stocks publicly traded in the U.S., as
represented by a broad stock market index.

BENCHMARK Russell 3000(R) Index.
INDEX

PRINCIPAL The Fund is designed to track U.S. equity markets as a whole
INVESTMENT and invests in stocks in the Russell 3000(R) Index.
STRATEGIES

SPECIAL While the Fund attempts to closely track the Russell 3000(R)
INVESTMENT Index, it does not invest in all 3,000 stocks in the index.
RISKS Thus there is no guarantee that the performance of the Fund
will match that of the index.

WHO MAY The Fund may be appropriate for investors who seek a fund
WANT TO that tracks the return of a broad market index.
INVEST

INSTITUTIONAL SOCIAL CHOICE EQUITY FUND

INVESTMENT The Fund seeks a favorable long-term rate of return that
OBJECTIVE reflects the investment performance of the U.S. stock
markets while giving special consideration to certain
social criteria.

BENCHMARK S&P 500 Index.
INDEX

PRINCIPAL The Fund invests in a diversified set of common stocks and
INVESTMENT other equity securities. Its goal is to perform
STRATEGIES consistently with the U.S. stock markets as represented by
the S&P 500 Index. The Fund invests only in companies whose
activities are consistent with the Fund's social criteria.

SPECIAL Because its social criteria exclude some investments, this
INVESTMENT Fund may not be able to take advantage of the same
RISKS opportunities or market trends as do the Funds that don't
use such criteria.

WHO MAY The Fund may be appropriate for investors who seek an
WANT TO equity investment that is generally broad-based but
INVEST excludes companies that engage in certain activities.

5
<PAGE> 10

INSTITUTIONAL BOND FUND

INVESTMENT The Fund seeks a favorable long-term return, primarily
OBJECTIVE through high current income consistent with preserving
capital.

BENCHMARK Lehman Brothers Aggregate Bond Index
INDEX

PRINCIPAL The Fund is invested primarily in a broad range of debt
INVESTMENT securities. The majority of the Fund's portfolio is invested
STRATEGIES in U.S. Treasury and Agency securities, corporate bonds, and
mortgage-backed or other asset-backed securities. The Fund
holds mainly high-quality securities rated in the top four
credit categories by Moody's or Standard & Poor's. The Fund
will overweight or underweight individual securities or
sectors depending on where we find undervalued, overlooked
or misunderstood issues that offer the potential for
superior returns compared to the Lehman index. The Fund may
also invest in non-investment grade securities (also called
"high-yield" or "junk" bonds) or privately placed
(non-registered) securities.

SPECIAL Investments in mortgage-backed securities are subject to
INVESTMENT prepayment or extension risk. This is the possibility that a
RISKS change in interest rates would cause the underlying
mortgages to be paid off sooner or later than expected. If
unanticipated prepayment occurs as a result of a declining
interest rate environment, the Fund would have to reinvest
the amounts that had been invested in the mortgage-backed
securities, possibly at a lower rate of return. If
unanticipated extension occurs as a result of a rising
interest rate environment, the Fund may not have sufficient
cash available for reinvestment when expected. High-yield
securities offer higher returns but also involve higher
risks than investment grade bonds. Their issuers may be
less creditworthy and/or have a higher risk of becoming
insolvent.

WHO MAY The Fund may be appropriate for more conservative investors
WANT TO who want to invest in a general bond fund that has the
INVEST potential for a higher yield and a slightly higher level of
risk than traditional bond funds.

6
<PAGE> 11

INSTITUTIONAL MONEY MARKET FUND

INVESTMENT The Fund seeks high current income consistent with
OBJECTIVE maintaining liquidity and preserving capital.

BENCHMARK IBC Money Fund All-Taxable Average
INDEX

PRINCIPAL The Fund invests primarily in high quality short-term money
INVESTMENT market instruments. It limits its investments to securities
STRATEGIES that present minimal credit risk and are rated in the
highest rating categories for short-term instruments.

WHO MAY The Fund may be suitable for conservative investors who are
WANT TO looking for a high degree of principal stability and
INVEST liquidity, and are willing to accept returns that are lower
than those offered by longer-term investments.

An investment in the Institutional Money Market Fund, like the other Funds, is
not insured or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency. Although the Institutional Money Market Fund seeks to
preserve the value of your investment at $1.00 per share, it is possible to lose
money by investing in the Fund.

PAST PERFORMANCE

No performance data for TIAA-CREF Institutional Mutual Funds is
included in this prospectus because none of the Funds has been in operation for
one full calendar year.

Performance information for other registered investment companies
managed by the investment advisory personnel who manage TIAA-CREF Institutional
Mutual Funds is provided on page 19 of this prospectus.

FEES AND EXPENSES

The following table describes the fees and expenses that you pay if you
buy and hold shares of the Funds.

<TABLE>
<S> <C>
SHAREHOLDER FEES (deducted directly from gross amount of transaction)
- --------------------------------------------------------------------
Maximum Sales Charge Imposed on Purchases (percentage of offering price) 0%
Maximum Deferred Sales Charge 0%
Maximum Sales Charge Imposed on Reinvested Dividends and Other Distributions 0%
Redemption Fee 0%
Exchange Fee 0%
</TABLE>

7
<PAGE> 12

<TABLE>
<CAPTION>
Investment Total Fund
ANNUAL FUND OPERATING EXPENSES Manage- Other Operating
(deducted from Fund assets) ment Fee Expenses(1) Expenses
- ------------------------------ ---------- ----------- --------
<S> <C> <C> <C>
Institutional International Equity Fund 0.__% 0.__% 0.__%
Institutional Growth Equity Fund 0.__% 0.__% 0.__%
Institutional Growth and Income Fund 0.__% 0.__% 0.__%
Institutional Equity Index Fund 0.__% 0.__% 0.__%
Institutional Social Choice Equity Fund 0.__% 0.__% 0.__%
Institutional Bond Fund 0.__% 0.__% 0.__%
Institutional Money Market Fund 0.__% 0.__% 0.__%
</TABLE>

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

(1) "Other Expenses" is based on estimated amounts for the current fiscal year.

EXAMPLE

This example is intended to help you compare the cost of investing in
the Funds with the cost of investing in other mutual funds.

The example assumes that you invest $10,000 in a 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 percent return
each year and that the Funds' operating expenses remain the same. Although your
actual costs may be higher or lower, based on these assumptions your costs would
be:

<TABLE>
<CAPTION>
1 Year 3 Years
------ -------
<S> <C> <C>
Institutional International Equity Fund $___ $___
Institutional Growth Equity Fund $___ $___
Institutional Growth and Income Fund $___ $___
Institutional Equity Index Fund $___ $___
Institutional Social Choice Equity Fund $___ $___
Institutional Bond Fund $___ $___
Institutional Money Market Fund $___ $___
</TABLE>

INVESTMENT OBJECTIVES, STRATEGIES AND RISKS

Each of the individual investment portfolios, or Funds, described below
has its own investment objective. The following describes each Fund's investment
objective, the principal investment strategies and techniques each Fund uses to
accomplish its objective, and the principal types of securities each Fund plans
to purchase. These policies and techniques are not fundamental and may be
changed by our Board of Trustees without shareholder approval.

8
<PAGE> 13

However, we'll notify you of any significant changes. For a complete listing of
the Funds' policies and restrictions, see the Statement of Additional
Information ("SAI").

There's no guarantee that any Fund will meet its investment objective.

EQUITY FUNDS USING THE DUAL INVESTMENT MANAGEMENT STRATEGY(SM)

Each of these three equity Funds has two separate segments called the
"stock selection" segment and the "enhanced index" segment. The relative sizes
of these two segments vary as the Fund manager shifts money between them in
response to investment opportunities.

The stock selection segment holds a relatively small number of stocks
that the Fund manager believes offer superior returns. The managers of these
equity Funds will usually use fundamental analysis to select individual stocks
or sectors for investment in the stock selection segment. Each equity Fund's
stock selection segment is described further below.

Money that is not invested in an equity Fund's stock selection segment
goes to its enhanced index segment. Here the goal is two-fold: (1) to outperform
each Fund's benchmark index and (2) to limit the possibility of significantly
underperforming that benchmark. The Funds' managers attempt to outperform the
benchmark indexes by over- or under-weighting many stocks in the index by small
amounts, based on proprietary stock scoring models. In other words, a Fund will
hold more or less of some stocks than does its benchmark index. The managers
attempt to control the risk of underperforming the benchmarks by maintaining the
same overall financial characteristics (such as volatility, dividend yield and
industry weights) as the benchmarks.

The Dual Investment Management Strategy enables the Funds to stay
invested even when the Fund manager cannot find sufficient investment
opportunities for the stock selection segment.

The benchmarks for each Fund's enhanced index segment currently are as
follows:

<TABLE>
<CAPTION>
Fund Benchmark
- ---- ---------
<S> <C>
Institutional International Equity Fund MSCI EAFE(R) (Europe, Australia, Far East) Index
Institutional Growth Equity Fund Russell 3000(R) Growth Index
Institutional Growth and Income Fund S&P 500(R) Index
</TABLE>

Using these indices is not a fundamental policy of TIAA-CREF Institutional
Mutual Funds, so we can substitute other indices without shareholder approval.
We'll notify you before we make such a change.

9
<PAGE> 14

INSTITUTIONAL INTERNATIONAL EQUITY FUND

The INSTITUTIONAL INTERNATIONAL EQUITY FUND seeks a favorable long-term
return, mainly through capital appreciation from a broadly diversified portfolio
that consists primarily of foreign equity investments. The Fund intends to
always have at least 80 percent of its assets in securities of companies located
in at least three different countries, other than the United States.

For the Fund's stock selection segment, we select individual stocks and
let the Fund's country and regional asset allocation evolve from that stock
selection. We do, however, regularly monitor the Fund's sector and country
exposure in order to control risk.

In particular, we look for companies with:

- sustainable growth
- focused management with successful track records
- unique and easy-to-understand franchises (brands)
- undervalued stock prices based on current earnings, assets,
and long-term growth prospects
- consistent generation of free cash flow

INVESTMENT RISKS: The Fund is subject to the general investment risks
described on page 17. In addition, investing in securities traded on foreign
exchanges or in foreign markets can involve risks beyond those of domestic
investing. These include: (1) changes in currency exchange rates; (2) possible
imposition of market controls or currency exchange controls; (3) possible
imposition of withholding taxes on dividends and interest; (4) possible seizure,
expropriation, or nationalization of assets; (5) more limited foreign financial
information or difficulty in interpreting it because of foreign regulations and
accounting standards; (6) the lower liquidity and higher volatility in some
foreign markets; (7) the impact of political, social, or diplomatic events; (8)
the difficulty of evaluating some foreign economic trends; or (9) the
possibility that a foreign government could restrict an issuer from paying
principal and interest to investors outside the country. Brokerage commissions
and transaction costs are often higher for foreign investments, and it may be
harder to use foreign laws and courts to enforce financial or legal obligations.

The risks noted above often increase in countries with emerging
markets. For example, these countries may have more unstable governments than
developed countries, and their economies may be based on only a few industries.
Because their securities markets may be very small, share prices may be
volatile. In addition, foreign investors are subject to a variety of special
restrictions in many emerging countries.

INSTITUTIONAL GROWTH EQUITY FUND

The INSTITUTIONAL GROWTH EQUITY FUND seeks a favorable long-term
return, mainly through capital appreciation, primarily from a diversified
portfolio of common stocks that present the opportunity for exceptional growth.
Normally, the Fund will have at least 80 percent of its assets in equity
securities that have the potential for capital appreciation.

10
<PAGE> 15

The Fund's stock selection segment can invest in companies of all
sizes, including companies in new and emerging areas of the economy and
companies with distinctive products or promising market conditions. We choose
individual investments based on a company's prospects under current or
forecasted economic, financial and market conditions, looking for companies we
believe have the potential for strong earnings or sales growth, or that appear
to be undervalued based on current earnings, assets, or growth prospects.

The Fund can also invest in large, well-known, established companies,
particularly when we believe they have new or innovative products, services, or
processes that enhance future earnings prospects. The Fund can also invest in
companies in order to benefit from prospective acquisitions, reorganizations, or
corporate restructurings or other special situations.

The Institutional Growth Equity Fund can buy foreign securities and
other instruments if we believe they have superior investment potential.
Depending on investment opportunities, the Fund may have from 0 to 40 percent of
its assets in foreign securities. The securities will be those traded on foreign
exchanges or in other foreign markets and may be denominated in foreign
currencies or other units of account. For more information about the risks of
foreign investments, see page 10.

INVESTMENT RISKS: The Fund is subject to the general investment risks
described on page 17. In addition, there are special risks to investing in
growth stocks. The Fund may at times hold a significant amount of stocks of
smaller, lesser-known companies. Their stock prices may fluctuate more than
those of larger companies because smaller companies may depend on narrow product
lines, have limited track records, lack depth of management, or have
thinly-traded securities. Also, stocks of companies involved in reorganizations
and other special situations can often involve more risk than ordinary
securities. Accordingly, the Institutional Growth Equity Fund will probably be
more volatile than the overall stock market, and it could significantly
outperform or underperform the stock market during any particular period. The
Fund's foreign holdings are subject to the risks of foreign investments
described for the Institutional International Equity Fund on page 10.

INSTITUTIONAL GROWTH AND INCOME FUND

The INSTITUTIONAL GROWTH AND INCOME FUND seeks a favorable long-term
return through capital appreciation and investment income, primarily from a
broadly diversified portfolio of common stocks. Normally, at least 80 percent of
the Fund's assets will be income-producing equity securities selected for their
investment potential.

The Fund invests in a broadly diversified portfolio of common stocks.
The Fund's stock selection segment concentrates on individual companies rather
than sectors or industries. We look for stocks of larger, well-established,
mature growth companies that we believe are attractively priced, show the
potential to grow faster than the rest of the market, and offer a growing stream
of dividend income. In particular, we look for companies that are leaders in
their industries. We also look for companies with shareholder-oriented
managements dedicated to creating shareholder value. The Fund may also invest in
rapidly growing smaller companies. It can have up to 20 percent of its assets in
foreign securities.

11
<PAGE> 16

INVESTMENT RISKS: The Fund is subject to the general investments risks
described on page 17. Its foreign holdings are subject to the risks of foreign
investments described for the Institutional International Equity Fund on page
10.

OTHER EQUITY FUNDS

INSTITUTIONAL EQUITY INDEX FUND

The INSTITUTIONAL EQUITY INDEX FUND seeks a favorable long-term rate of
return from a diversified portfolio selected to track the overall market for
common stocks publicly traded in the U.S., as represented by the Russell
3000(R), a broad market index.

Although the Fund invests in stocks in the Russell 3000 Index, it
doesn't invest in all 3,000 stocks in the index. Rather, we use a sampling
approach to ensure that the Fund closely matches the overall investment
characteristics (for example, yield and industry weight) of the index. This
means that a company can remain in the Fund even if it performs poorly, unless
the company is removed from the Russell 3000.

Using the Russell 3000 Index isn't fundamental to the Fund's investment
objective and policies. We can change the index used in this Fund at any time
and will notify you if we do so.

The Fund can also invest in securities and other instruments, such as
futures, whose return depends on stock market prices. We select these securities
to attempt to match the total return of the Russell 3000 but may not always do
so.

The Russell 3000 Index is an unmanaged index of stocks of the 3,000
largest publicly traded U.S. companies, based on market capitalization. Russell
3000 companies represent about 98% of the total market capitalization of the
publicly traded U.S. equity market. The market capitalization of the individual
companies in the index ranged from $2 million to $333 billion with an average of
$72 billion as of December 31, 1998. The Frank Russell Company determines the
composition of the index based only on market capitalization and can change its
composition at any time. The Russell 3000 Index is not a mutual fund and you
cannot invest directly in the index.

INVESTMENT RISKS: While the Fund attempts to closely track the Russell
3000 Index and changes are made to its holdings to reflect changes in the index,
the Fund does not invest in all 3,000 stocks in the index. Thus, there is no
guarantee that the performance of the Fund will match that of the index. Also,
because the index's returns aren't reduced by investment and other operating
expenses, the Fund's ability to match the index will be adversely affected by
the costs of buying and selling stocks as well as other expenses.

INSTITUTIONAL SOCIAL CHOICE EQUITY FUND

The INSTITUTIONAL SOCIAL CHOICE EQUITY FUND seeks a favorable long-term
rate of return that reflects the investment performance of the U.S. stock
markets while giving special

12
<PAGE> 17

consideration to certain social criteria. Normally, at least 80% of the Fund's
assets will be invested in common stocks.

The social criteria the Fund takes into consideration are
non-fundamental investment policies. They can change without the approval of the
Fund's shareholders. Currently, the Fund invests only in companies that do not:

- - engage in activities that result or are likely to result in significant
damage to the natural environment;
- - have significant portion of its business in weapons manufacturing;
- - produce and market alcoholic beverages or tobacco products;
- - produce nuclear energy; or
- - have operations in Northern Ireland and have not adopted the MacBride
Principles (a fair employment code for U.S. firms operating in Northern
Ireland) or have not operated consistently with such principals and in
compliance with the Fair Employment Act of 1989 (Northern Ireland).

For the second and third criteria, we assess the issuer to decide whether the
activity is a "significant" part of its business -- basing our decision on, for
example, how large a part of a company's operation the activity involves or how
much revenue it brings in.

The Corporate Governance and Social Responsibility Committee of our
Board of Trustees provides guidance in deciding whether investments meet the
social criteria. It uses information from independent organizations such as the
Investor Responsibility Research Center, Inc. We'll do our best to make sure the
Fund's investments meet the social criteria, but we can't guarantee that every
holding will always do so. Even if an investment is not excluded by the social
criteria, we have the option of excluding it if we decide it is not suitable.

The Fund attempts to perform consistently with the U.S. stock markets
as represented by the Standard & Poor's 500 Index. The Fund can also invest up
to 15% of its assets in foreign securities.

The Fund isn't restricted from investing in any securities issued or
guaranteed by the U.S. government or its agencies or instrumentalities. The Fund
can also invest in securities issued by other countries or their agencies and
instrumentalities as approved by the Committee on Corporate Governance and
Social Responsibility.

INVESTMENT RISKS: Because its social criteria exclude some investments,
this Fund may not be able to take advantage of the same opportunities or market
trends as do the Funds that don't use such criteria.

ADDITIONAL INVESTMENT STRATEGIES FOR THE EQUITY FUNDS

In addition to the principal types of securities identified in the
individual Fund descriptions above, each equity Fund can hold short-term debt
securities of the same type as

13
<PAGE> 18

those held by the Institutional Money Market Fund (see page 16) and other kinds
of short-term instruments. These help the Funds maintain liquidity, use cash
balances effectively, and take advantage of attractive investment opportunities.
The equity Funds can also hold fixed-income securities they acquire because of
mergers, recapitalizations, or otherwise.

Similarly, each Fund may also buy and sell options, futures contracts,
and options on futures. We intend to use options and futures primarily for
hedging or for cash management. To manage currency risk, the equity Funds can
also enter into forward currency contracts, and buy or sell options and futures
on foreign currencies.

The equity Funds can also invest in newly developed financial
instruments, such as equity swaps (including arrangements where the return is
linked to a stock market index) and equity-linked fixed-income securities, so
long as these are consistent with a Fund's investment objective and
restrictions.

THE FIXED-INCOME FUNDS

INSTITUTIONAL BOND FUND

The INSTITUTIONAL BOND FUND seeks a favorable long-term return,
primarily through high current income consistent with preserving capital.
Normally, at least 80 percent of the Fund's assets will be invested in bonds.

The Fund's portfolio is invested primarily in a broad range of debt
securities. The majority is invested in U.S. Treasury and Agency securities,
corporate bonds, and mortgage-backed or other asset-backed securities. The
Fund's holdings are mainly high-quality securities rated in the top four credit
categories by Moody's or Standard & Poor's, or that we determine are of
comparable quality. The Fund will overweight or underweight individual
securities or sectors, as compared to their weight in the Lehman index,
depending on where we find undervalued, overlooked or misunderstood issues that
offer the potential for superior investment returns compared to the Lehman
index. The Fund can make foreign investments, but we don't expect them to exceed
15 percent of the Fund's assets. The Fund can also invest in money market
instruments.

The Fund may also invest in securities with special features in an
effort to enhance its total return. This category of the Fund's portfolio will
primarily consist of privately placed securities (including "Rule 144A" private
placements) or non-investment grade securities (those rated Ba1 or lower by
Moody's or BB+ or lower by Standard & Poor's). The Fund will not invest more
than 25 percent of its assets in privately placed and high-yield securities.

The Institutional Bond Fund's investments in mortgage-backed securities
can include pass-through securities sold by private, governmental and
government-related organizations and collateralized mortgage obligations
("CMOs"). Mortgage pass-through securities are created when mortgages are pooled
together and interests in the pool are sold to investors. The cash flow from the
underlying mortgages is "passed through" to investors in periodic principal and

14
<PAGE> 19

interest payments. CMOs are obligations that are fully collateralized directly
or indirectly by a pool of mortgages from which payments of principal and
interest are dedicated to the payment of principal and interest by the CMOs.

The Fund can also invest in interest-only and principal-only
mortgage-backed securities. These instruments have unique characteristics and
are more sensitive to prepayment and extension risks than traditional
mortgage-backed securities. These risks are described below in the "Investment
Risks" section for this Fund.

The Fund may use an investment strategy called "mortgage rolls," in
which we "roll over" an investment in a mortgage-backed security before its
settlement date for a similar security with a later settlement date. The Fund
may also engage in duration-neutral relative value trading, a strategy in which
we buy and sell government bonds of identical credit quality but different
maturity dates in an attempt to take advantage of spread differentials along the
yield curve. These strategies are both designed to enhance the Fund's returns,
but they do increase the Fund's portfolio turnover rate. However, we don't
expect these strategies to significantly raise the Fund's capital gains.

The Fund may also buy and sell options, futures contracts, and options
on futures. We intend to use options and futures primarily for hedging or for
cash management. To manage currency risk, the Fund can also enter into forward
currency contracts, and buy or sell options and futures on foreign currencies.
The Fund can also buy and sell swaps and options on swaps, so long as these are
consistent with the Fund's investment objective and restrictions.

INVESTMENT RISKS: Non-investment-grade securities are usually called
"high-yield" or "junk" bonds. These lower-rated bonds offer higher returns but
also entail higher risks. Their issuers may be less creditworthy or have a
higher risk of becoming insolvent. Small changes in the issuer's
creditworthiness can have more impact on the price of lower-rated bonds than
would comparable changes for investment-grade bonds (those rated Baa or higher
by Moody's or rated BBB or higher by S&P). Lower-rated bonds can also be harder
to value or sell, and their prices can be more volatile than the prices of
higher-quality securities.

The above risks of holding high-yield bonds can also apply to the lower
levels of "investment grade" bonds (for example, Moody's Baa and S&P's BBB).
Also, securities originally rated "investment grade" are sometimes downgraded
later on, should a ratings agency like Moody's or S&P believe the issuer's
business outlook or creditworthiness has deteriorated. A downgraded security
already held in the Fund's portfolio may or may not be sold, depending on our
analysis of the issuer's financial prospects. We don't rely exclusively on
ratings agencies when making investment decisions because they may not alone be
an accurate measure of the risk of lower-rated bonds. Instead, we also do our
own credit analysis, paying particular attention to economic trends and other
market events.

The Fund can also invest in privately placed debt securities. One risk
of investing in private placements is that they may be difficult to sell for
their fair market value.

The Fund's investments in mortgage-backed securities are subject to
prepayment or

15
<PAGE> 20

extension risk, which is the possibility that a change in interest rates may
cause the underlying mortgages to be paid off sooner or later than expected. If
unanticipated prepayment occurs as a result of a declining interest rate
environment, the Fund would then have to reinvest the amounts that had been
invested in the mortgage-backed securities, possibly at a lower rate of return.
If unanticipated extension occurs as a result of a rising interest rate
environment, the Fund may not have sufficient cash available for reinvestment
when expected.

INSTITUTIONAL MONEY MARKET FUND

The INSTITUTIONAL MONEY MARKET FUND seeks high current income to the
extent consistent with maintaining liquidity and preserving capital.

We seek to maintain a stable net asset value of $1.00 per share of the
Institutional Money Market Fund by investing in assets that present minimal
credit risk, maintaining an average weighted maturity of 90 days or less, and
investing all of the Fund's assets in dollar-denominated securities or other
instruments maturing in 397 days or less. We can't assure you that we will be
able to maintain a stable net asset value of $1.00 per share for this Fund.

The Fund will invest primarily in:

(1) commercial paper (short-term "IOUs" issued by corporations and
others) or variable-rate, floating-rate, or variable-amount
securities of domestic or foreign companies;

(2) obligations of commercial banks, savings banks, savings and
loan associations, and foreign banks whose latest annual
financial statements show more than $1 billion in assets.
These include certificates of deposit, time deposits, bankers'
acceptances, and other short-term debt;

(3) securities issued by or whose principal and interest are
guaranteed by the U.S. government or one of its agencies or
instrumentalities;

(4) other debt obligations with a remaining maturity of 397 days
or less issued by domestic or foreign companies;

(5) repurchase agreements involving securities issued or
guaranteed by the U.S. government or one of its agencies or
instrumentalities, or involving certificates of deposit,
commercial paper, or bankers' acceptances;

(6) participation interests in loans banks have made to the
issuers of (1) and (4) above (these may be considered
illiquid);

(7) asset-backed securities issued by domestic corporations or
trusts;

(8) obligations issued or guaranteed by foreign governments or
their political subdivisions, agencies, or instrumentalities;
and

16
<PAGE> 21

(9) obligations of international organizations (and related
government agencies) designated or supported by the U.S. or
foreign government agencies to promote economic development or
international banking.

The Institutional Money Market Fund will only purchase money market
instruments that at the time of purchase are "First Tier Securities", that is
rated within the highest category by at least two nationally recognized
statistical rating organizations ("NRSROs"), or rated within the highest
category by one NRSRO if it is the only NRSRO to have issued a rating for the
security, or unrated securities of comparable quality. The Fund can also invest
up to 30 percent of its assets in money-market and debt instruments of foreign
issuers denominated in U.S. dollars.

The above list of investments is not exclusive and the Fund may make
other investments consistent with its investment objective and policies.

INVESTMENT RISKS: The fund is subject to the general investment risks
described below.

RISKS OF INVESTING IN ANY OF THE FUNDS

GENERAL INVESTMENT RISKS

To varying degrees, the Funds are all subject to several general types
of risks.

(1) One is market risk -- stock and bond price volatility due to
changing conditions in the financial markets.

(2) Another is interest rate risk -- the risk that a bond's or
stock's value will decline if interest rates change. For
example, a rise in interest rates usually causes the market
value of fixed-rate securities to go down.

(3) Another kind of risk is company risk. For stocks or other
equity securities, it comes from the possibility that current
earnings will fall or that overall financial soundness will
decline, reducing the security's value. For bonds and other
debt securities, company risk comes from the possibility the
issuer won't be able to pay principal and interest when due.

(4) Finally, investments can be subject to current income
volatility. Your income from an investment in a Fund may fall
as a result of overall interest rate changes.

YEAR 2000 RISKS

Many services provided to the Funds and their shareholders depend on
the smooth functioning of computer systems. Many computer systems now in use
can't distinguish the year 2000 from the year 1900 because dates have been
encoded using only the last two digits of the year.

17
<PAGE> 22

Like other mutual funds, financial and business organizations, and
individuals around the world, TIAA-CREF Institutional Mutual Funds could be
adversely affected if the computer systems it relies on do not properly process
and calculate information and data involving dates from and after January 1,
2000. These computer systems include those used by its investment adviser and
other service providers. Together, TIAA-CREF Institutional Mutual Funds and its
investment adviser are taking steps that we believe are reasonably designed to
address issues involving the Year 2000 for the computer systems we use. We are
also seeking reasonable assurances that our service providers are taking
comparable steps. However, currently we can't assure you that these steps will
be sufficient to avoid any adverse impact on the Funds.

If the systems the Funds rely on do fail or produce faulty data, there
could be delays in processing transactions, or we may temporarily be unable to
engage in normal business activities. Also, a Fund's performance could be
affected if a systems failure at a company or government entity, either in the
U.S. or abroad (where Year 2000 compliance may be less prevalent), affects the
price of securities that the Fund owns.

MANAGEMENT OF THE FUNDS

THE FUNDS' INVESTMENT ADVISER

Teachers Advisors, Inc. ("Advisors") manages the assets of TIAA-CREF
Institutional Mutual Funds, under the supervision of the Funds' Board of
Trustees (the "Board"). Advisors is an indirect wholly-owned subsidiary of
Teachers Insurance and Annuity Association of America ("TIAA"). It is registered
as an investment adviser with the U.S. Securities and Exchange Commission under
the Investment Advisers Act of 1940. Advisors also manages the investments of
TIAA Separate Account VA-1, the TIAA-CREF Life Funds, the TIAA-CREF Mutual
Funds, and the investment portfolio of New York State's College Choice Tuition
Savings Plan. Through an affiliated investment adviser, TIAA-CREF Investment
Management, LLC ("Investment Management"), the personnel of Advisors also manage
the investment accounts of the College Retirement Equities Fund ("CREF"). As of
March 31,1999, Advisors and Investment Management together had $__._ billion of
registered investment company assets under management. Advisors is located at
730 Third Avenue, New York, NY 10017.

Advisors' duties include conducting research, recommending investments,
and placing orders to buy and sell securities. Advisors also acts as liaison
among the various service providers to the Funds, including custodians, fund
administrators, and transfer agents.

Under the terms of an Investment Management Agreement between TIAA-CREF
Institutional Mutual Funds and Advisors, Advisors is entitled to an annual fee
of 0.__%, 0.__%, 0._%, 0.__%, 0.__%, 0.__% and 0.__% of the average daily net
assets of the Institutional International Equity Fund, the Institutional Growth
Equity Fund, the Institutional Growth and Income Fund, the Institutional Equity
Index Fund, the Institutional Social Choice Equity Fund, the Institutional Bond
Fund, and the Institutional Money Market Fund, respectively.

18
<PAGE> 23

PRIOR PERFORMANCE OF INVESTMENT ADVISER

Please do not confuse the Funds with other registered investment
company portfolios using very similar or nearly identical names that are offered
by TIAA-CREF Mutual Funds, CREF, or a separate account of TIAA or of its
subsidiary TIAA-CREF Life Insurance Company. However, the investment objectives
and policies of certain Funds are very similar to the investment objectives and
policies of other registered investment company portfolios that are managed by
Advisors or Investment Management. Nevertheless, the investment performance of
the Funds may be lower, or higher, than the investment results of such other
portfolios. We do not promise that the investment results of any of the Funds
will be comparable to the investment results of any other mutual fund, CREF
account, or separate account portfolio, even if the other portfolio uses a very
similar name, is managed by the same investment advisory personnel, and has the
same investment objective and policies as the applicable Fund.

TIAA-CREF Institutional Mutual Funds commenced operations on _________
___, 1999, and each Fund has a limited performance record. However, the
investment objective, policies, strategies, and risks of each of the Funds
(except the Institutional Social Choice Equity Fund) is substantially similar to
one or more other registered investment company portfolios managed by Advisors
or Investment Management. The performance of these other portfolios may be
relevant to prospective investors in TIAA-CREF Institutional Mutual Funds.

The charts below show historical performance for the International
Equity Fund, the Growth Equity Fund, the Growth & Income Fund, the Bond Plus
Fund, and the Money Market Fund of TIAA-CREF Mutual Funds (managed by Advisors)
and for the Equity Index Account of CREF (managed by the same personnel in their
capacities with Investment Management). The data are provided to illustrate the
experience of Advisors' personnel in managing an investment portfolio
substantially similar to the Institutional International Equity Fund, the
Institutional Growth Equity Fund, the Institutional Growth and Income Fund, the
Institutional Bond Fund, the Institutional Money Market Fund, and the
Institutional Equity Index Fund, respectively, of TIAA-CREF Institutional Mutual
Funds.

This historical performance information is not intended to predict or
suggest the returns that the corresponding Fund of TIAA-CREF Institutional
Mutual Funds might experience. The results are net of investment management and
other operating expenses of the portfolios. The funds of TIAA-CREF Mutual Funds
are retail mutual fund portfolios with higher total annual operating expenses
than the corresponding Funds of TIAA-CREF Institutional Mutual Funds during the
period illustrated. The Equity Index Account of CREF is a variable annuity
account (rather than a mutual fund portfolio) with slightly higher total annual
operating expenses than the Institutional Equity Index Fund of TIAA-CREF
Institutional Mutual Funds during the period illustrated.

19
<PAGE> 24

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL
RETURN TIAA-CREF Mutual Funds CREF
- --------------------------------------------------------------------------------------------------------------------
International Growth Equity Growth & Income Bond Plus Money Market Equity Index
Period Equity Fund Fund Fund Fund Fund Account
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1 year ended
June 30, 1999 __.__% __.__% __.__% __.__% _.__% __.__%
- --------------------------------------------------------------------------------------------------------------------
3 years ended
June 30, 1999 N/A N/A N/A N/A N/A __.__%
- --------------------------------------------------------------------------------------------------------------------
5 years ended
June 30, 1999 N/A N/A N/A N/A N/A __.__%
- --------------------------------------------------------------------------------------------------------------------
Inception through
June 30, 1999 __.__% __.__% __.__% __.__% _.__% __.__%
- --------------------------------------------------------------------------------------------------------------------
Date of inception 9/2/97 9/2/97 9/2/97 9/2/97 9/2/97 4/29/94
- --------------------------------------------------------------------------------------------------------------------
</TABLE>

FUND MANAGERS

The Institutional International Equity Fund is managed by Chris
Semenuk, Director-Global Portfolio Management for Advisors. He is also one of
three co-managers of the CREF Global Equities Account and is also responsible
for managing TIAA-CREF Mutual Funds' International Equity Fund. From 1995 to
1997, he was responsible for company research and analysis for the CREF Global
Equities Account. Previously he was a senior securities analyst for the CREF
Stock Account. Mr. Semenuk joined TIAA-CREF in 1993.

The Institutional Growth Equity Fund is managed by Jeffrey Siegel,
Managing Director for Advisors. Mr. Siegel is also responsible for managing the
investments of the CREF Growth Account and TIAA-CREF Mutual Funds' Growth Equity
Fund. From 1992 to 1997, he was manager of the CREF Global Equities Account. Mr.
Siegel joined TIAA-CREF in 1988.

The Institutional Growth and Income Fund is managed by Carlton N.
Martin, Managing Director-Global Research for Advisors. He has also been one of
three co-managers of the CREF Global Equities Account since 1998 and manages
TIAA-CREF Mutual Funds' Growth & Income Fund. Prior to 1998, he was responsible
for investments in the chemical, paper and forest products as well as the
environmental, engineering and construction industries for certain CREF
Accounts. Mr. Martin joined TIAA-CREF in 1980.

The Institutional Equity Index Fund and the Institutional Social Choice
Equity Fund are managed by Advisors' quantitative portfolio management group,
whose members are jointly responsible for the day-to-day management of these
Funds.

The Institutional Bond Fund is managed by Elizabeth D. Black, Managing
Director-Portfolio Management for Advisors. Ms. Black has also been responsible
for managing the investments in CREF's Bond Market Account and the bond portion
of CREF's Social Choice Account since 1996, and TIAA-CREF Mutual Funds' Bond
Plus Fund since 1997.

20
<PAGE> 25

Prior to 1996, she was sector manager of TIAA's mortgage-backed securities
group. Ms. Black joined TIAA-CREF in 1987.

The Institutional Money Market Fund is managed by Steven Traum,
Managing Director-Money Markets and Inflation Linked Bond for Advisors. Mr.
Traum has also been responsible for managing the investments of the CREF Money
Market Account since 1988, the CREF Inflation Linked Bond Account since 1997,
and TIAA-CREF Mutual Funds' Money Market Fund since 1997. He also manages the
cash components of the other TIAA-CREF Institutional Mutual Funds, the other
TIAA-CREF Mutual Funds and the CREF accounts. Mr. Traum joined TIAA-CREF in
1983.

SERVICE PROVIDERS

TIAA-CREF Institutional Mutual Funds may rely on affiliated or
unaffiliated persons for services related to record keeping and other
shareholder services (e.g., unaffiliated transfer agents maintaining individual
account records for omnibus accounts in certain circumstances), may compensate
such service providers, and may reflect these payments as an administrative
expense of the applicable class of shares.

CALCULATING SHARE PRICE

We determine the net asset value ("NAV") per share, or share price, of
a Fund on each day the New York Stock Exchange is open for business. We do this
when trading closes on all U.S. national exchanges where securities or other
investments of a Fund are principally traded. We will not price Fund shares on
days that the New York Stock Exchange is closed. We compute a Fund's NAV by
dividing the value of the Fund's assets, less its liabilities, by the number of
outstanding shares of that Fund.

We usually use market quotations or independent pricing services to
value securities and other instruments held by the Funds, except the
Institutional Money Market Fund. If market quotations or independent pricing
services aren't readily available, we'll use a security's "fair value," as
determined in good faith by or under the direction of the TIAA-CREF
Institutional Mutual Funds' Board of Trustees. We may also use fair value if
events that have a significant effect on the value of an investment (as
determined in our sole discretion) occur between the time when its price is
determined and the time a Fund's net asset value is calculated.

To calculate the Institutional Money Market Fund's net asset value per
share, we value its portfolio securities at their amortized cost. This valuation
method does not take into account unrealized gains or losses on the Fund's
portfolio securities. Amortized cost valuation involves first valuing a security
at cost, and thereafter assuming an amortization to maturity of any discount or
premium, regardless of the impact of fluctuating interest rates on the
security's market value. While this method provides certainty in valuation,
there may be times when the value of a security, as determined by amortized
cost, may be higher or lower than the price the Institutional Money Market Fund
would receive if it sold the security.

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<PAGE> 26

DIVIDENDS AND DISTRIBUTIONS

Each Fund expects to declare and distribute to shareholders
substantially all of its net investment income and net realized capital gains,
if any. The amount distributed will vary according to the income received from
securities held by the Fund and capital gains realized from the sale of
securities. The following table shows how often we plan to pay dividends on each
Fund:

<TABLE>
<CAPTION>
Fund Dividend Paid
- ---- -------------
<S> <C>
Institutional International Equity Fund Annually
Institutional Growth Equity Fund Annually
Institutional Growth and Income Fund Quarterly
Institutional Equity Index Fund Annually
Institutional Social Choice Equity Fund Annually
Institutional Bond Fund Monthly
Institutional Money Market Fund Monthly
</TABLE>

Although we pay dividends monthly from the Institutional Money Market
Fund, these dividends are calculated and declared daily.

We pay capital gains from Funds that have them once a year.

You can elect from among the following distribution options:

1. REINVESTMENT OPTION, SAME FUND. We'll automatically reinvest your dividend
and capital gain distributions in additional shares of the Fund. Unless you
elect otherwise, this will be your distribution option.

2. REINVESTMENT OPTION, DIFFERENT FUND. We'll automatically reinvest your
dividend and capital gain distributions in additional shares of another Fund in
which you already hold shares.

3. INCOME-EARNED OPTION. We'll automatically reinvest your capital gain
distributions, but you will be sent a check for each dividend distribution.

4. CAPITAL GAINS OPTION. We'll automatically reinvest your dividend
distributions, but you will be sent a check for each capital gain distribution.

5. CASH OPTION. We'll send a check for your dividend and each capital gain
distribution.

We make distributions for each Fund on a per share basis to the
shareholders of record on the Fund's distribution date. We do this regardless of
how long the shares have been held. That means if you buy shares just before or
on a record date, you will pay the full price for the shares and then you may
receive a portion of the price back as a taxable distribution. Cash distribution
checks will be mailed within seven days.

22
<PAGE> 27

TAXES

As with any investment, you should consider how your investment in any
Fund will be taxed.

Taxes on distributions. Unless you are tax-exempt or hold Fund shares
in a tax-deferred account, you must pay federal income tax, and possibly also
state or local taxes, on distributions each year. Your distributions are taxable
when they are paid, whether you take them in cash or reinvest them. However,
distributions declared in October, November or December and paid in January are
taxable as if they were paid on December 31 of the prior year.

For federal tax purposes, income and short-term capital gain
distributions from a Fund are taxed as ordinary income; long-term capital gain
distributions are taxed as long-term capital gains. Every January, we will send
you and the IRS a statement showing the taxable distributions paid to you in the
previous year from each Fund. Long-term capital gain distributions may be taxed
at a maximum federal rate of 20 percent to individual investors (or at 10
percent to individual investors who are in the 15 percent tax bracket).

Taxes on transactions. Redemptions, including exchanges to other Funds,
are also subject to capital gains tax or capital loss deductions. A capital gain
or loss is the difference between the cost of your shares and the price you
receive when you sell them.

Whenever you sell shares of a Fund, we will send you a confirmation
statement showing how many shares you sold and at what price. However, you or
your tax preparer must determine whether this sale resulted in a capital gain or
loss and the amount of tax to be paid on any gain. Be sure to keep your regular
account statements; the information they contain will be essential in
calculating the amount of your capital gains or losses.

Backup withholding. If you fail to provide a correct taxpayer
identification number or fail to certify that it is correct, we are required by
law to withhold 31% of all the taxable distributions and redemption proceeds
paid from your account. We are also required to begin backup withholding if
instructed by the IRS to do so.

"Buying a dividend." If you buy shares just before a Fund deducts a
distribution from its net asset value, you will pay the full price for the
shares and then receive a portion of the price back in the form of a taxable
distribution. This is referred to as "buying a dividend." For example, assume
you bought shares of a Fund for $10.00 per share the day before the Fund paid a
$0.25 dividend. After the dividend was paid, each share would be worth $9.75,
and you would have to include the $0.25 dividend in your gross income for tax
purposes.

Effect of foreign taxes. Foreign governments may impose taxes on a Fund
and its investments and these taxes generally will reduce such Fund's
distributions. If a Fund qualifies to pass through a credit for such taxes paid,
an offsetting tax credit or deduction may be available to you. If so, your tax
statement will show more taxable income than was actually distributed by the
Fund, but will also show the amount of the available offsetting credit or
deduction.

23
<PAGE> 28

Other restrictions. There are tax requirements that all mutual funds
must follow in order to avoid federal taxation. In its effort to adhere to these
requirements, a Fund may have to limit its investment in some types of
instruments.

Special considerations for certain institutional investors. If you are
a corporate investor, a portion of the dividends from net investment income paid
by the Institutional Growth Equity Fund, the Institutional Growth and Income
Fund, the Institutional Equity Index Fund, and the Institutional Social Choice
Equity Fund will generally qualify for the corporate dividends-received
deduction. However, the portion of the dividends that qualify depends on the
aggregate qualifying dividend income received by each Fund from domestic (U.S.)
sources. Certain holding period and debt financing restrictions may apply to
corporate investors seeking to claim the deduction. We expect that little or
none of the distributions paid by the Institutional International Equity Fund,
the Institutional Bond Fund, and the Institutional Money Market Fund will
qualify for the corporate dividends-received deduction.

YOUR ACCOUNT: BUYING, SELLING OR EXCHANGING SHARES

ELIGIBLE INVESTORS

Shares of TIAA-CREF Institutional Mutual Funds are only available for
purchase by certain intermediaries affiliated with TIAA-CREF ("TIAA-CREF
Intermediaries"), such as TIAA-CREF Trust Company, FSB (the "Trust Company"), or
other persons, such as state-sponsored tuition savings plans, who have entered
into a contract with a TIAA-CREF Intermediary that enables them to purchase
shares of the Funds. Collectively with TIAA-CREF Intermediaries, these
contractually eligible investors are referred to as "Eligible Investors" in the
rest of this prospectus.

In the future, TIAA-CREF Institutional Mutual Funds may offer
additional classes of shares (with different shareholder servicing,
distribution, administrative, or other fees and expenses) for some or all of its
Funds. For example, we may introduce another class of shares to be sold directly
to investors who do not have a specific contractual relationship with a
TIAA-CREF Intermediary.

PURCHASE OF FUND SHARES

There is no minimum investment requirement for Eligible Investors. All
purchases must be in U.S. dollars and checks must be drawn on U.S. banks.

We consider all requests for purchases, checks, and other forms of
payments to be received when they are received in "good order" (see page 28). We
won't accept third-party checks.

There may be circumstances when we will not permit Eligible Investors
to invest in one

24
<PAGE> 29

or more of the Funds. We reserve the right to suspend or terminate the offering
of shares by one or more Funds. We also reserve the right to reject any specific
purchase request.

PURCHASES BY ELIGIBLE INVESTORS

Eligible Investors may invest in the Funds in any of the following
ways. All other existing and prospective investors should contact their
TIAA-CREF Intermediary for applicable purchase requirements.

To purchase shares by mail, an Eligible Investor should make its check
payable to TIAA-CREF Institutional Mutual Funds. Send the check by First Class
Mail to TIAA-CREF Institutional Mutual Funds, c/o State Street Bank and Trust
Company, P.O. Box ____, Boston, MA 02266-____, or by overnight delivery to
TIAA-CREF Institutional Mutual Funds, c/o State Street Bank and Trust Company,
66 Brooks Drive, Braintree, MA 02184-3839.

To purchase shares by wire, an Eligible Investor should instruct its
bank to wire money to State Street Bank and Trust Company, ABA Number
____________, DDA Number ____________. Specify on the wire: (1) TIAA-CREF
Institutional Mutual Funds; (2) account registration (names of registered
owners), address and Social Security Number(s) or Taxpayer Identification
Number; (3) whether the investment is for a new or existing account (provide
Fund account number if existing); and (4) the Fund or Funds in which you want to
invest, and amount to be invested in each.

INVESTING THROUGH THE TRUST COMPANY

Clients of the Trust Company may invest in TIAA-CREF Institutional
Mutual Funds only through the Trust Company, which is an Eligible Investor and
serves as the TIAA-CREF Intermediary for its clients. Contact the Trust Company
regarding how investments in Fund shares are held for your benefit. In addition
to the fees and expenses deducted by the Funds, you may be charged a fee by the
Trust Company for the services it provides you.

POINTS TO REMEMBER FOR ALL PURCHASES

- - Each investment by an Eligible Investor in TIAA-CREF Institutional
Mutual Funds must be for a specified dollar amount. We can't accept
purchase requests specifying a certain price, date, or number of
shares; we'll return these investments.

- - If you invest in TIAA-CREF Institutional Mutual Funds through an
Eligible Investor, the Eligible Investor may charge you a fee in
connection with your investment (in addition to the fees and expenses
deducted by the Funds). Contact the Eligible Investor to learn whether
there are any other conditions, such as a minimum investment
requirement, on your transactions. In addition, Eligible Investors that
are not themselves affiliated with TIAA-CREF may be charged a fee by
their TIAA-CREF Intermediary (in addition to the fees and expenses
deducted by the Funds).

25
<PAGE> 30

- - As an Eligible Investor, if your purchase check does not clear or
payment on it is stopped, or if we do not receive good funds through
wire transfer, we will treat this as a redemption of the shares
purchased when your check or wire transfer was received. You will be
responsible for any resulting loss incurred by any of the Funds. If you
are already a shareholder, we can redeem shares from any of your
account(s) as reimbursement for all losses. We also reserve the right
to restrict you from making future purchases in any of the Funds.

IN-KIND PURCHASES OF SHARES

Advisors, at its sole discretion, may permit an Eligible Investor to
purchase shares with investment securities (instead of cash), if: (1) Advisors
believes the securities are appropriate investments for the particular Fund; (2)
the securities offered to the Fund are not subject to any restrictions upon
their sale by the Fund under the Securities Act of 1933, or otherwise; and (3)
the securities are permissible holdings under the Fund's investment
restrictions. If the Fund accepts the securities, the Eligible Investor's
account will be credited with Fund shares equal in net asset value to the market
value of the securities received. Eligible Investors interested in making
in-kind purchases should contact their TIAA-CREF Intermediary.

HOW TO REDEEM SHARES

REDEMPTIONS BY ELIGIBLE INVESTORS

Eligible Investors can redeem (sell) their Fund shares at any time. If
your shares were purchased through an Eligible Investor, contact the Eligible
Investor for applicable redemption requirements. Shares purchased through an
Eligible Investor must be redeemed by the Eligible Investor. For further
information, contact your TIAA-CREF Intermediary.

We will only accept redemption requests that specify a dollar amount or
number of shares to be redeemed. All other requests, including those specifying
a certain price or date, will be returned.

We accept redemption orders either through a written request delivered
to one of the addresses listed in "Purchases by Eligible Investors" (page 25) or
through a telephone request made by calling _______________. Once a redemption
request is communicated to us, it becomes irrevocable and cannot be modified or
canceled.

Usually, we send redemption proceeds to the Eligible Investor on the
second business day after we receive a redemption request, but not later than
seven days afterwards, assuming the request is in good order (see page 28). If a
redemption is requested shortly after a recent purchase by check, the redemption
proceeds may not be paid until payment for the purchase is collected. This can
take up to ten days.

We can postpone payment if (a) the New York Stock Exchange is closed
for other than usual weekends or holidays, or trading on the New York Stock
Exchange is restricted; (b) an

26
<PAGE> 31

emergency exists as defined by the SEC, or the SEC requires that trading be
restricted; or (c) the SEC permits a delay for the protection of investors.

We send redemption proceeds to the Eligible Investor at the address or
bank account of record. If proceeds are to be sent elsewhere, we will require a
letter of instruction from the Eligible Investor with signature guarantee (see
page 28). We can send the redemption proceeds by check to the address of record
or by wire transfer.

REDEEMING SHARES THROUGH THE TRUST COMPANY

If you purchased shares through the Trust Company, it is responsible
for making any redemption proceeds available to you. In addition, the Trust
Company may impose its own restrictions on your ability to redeem shares. Please
contact the Trust Company directly for more information.

IN-KIND REDEMPTIONS OF SHARES

Large redemptions by any Eligible Investor that exceed $250,000 or 1%
of a Fund's assets during any 90-day period may be considered detrimental to the
Fund's existing shareholders. Therefore, at its sole discretion, the Fund may
require that you take a "distribution in kind" upon redemption and may give you
portfolio securities instead of cash. The securities you receive in this manner
will need to be sold through a broker, and you may therefore incur transaction
costs when you sell them.

HOW TO EXCHANGE SHARES

EXCHANGES BY ELIGIBLE INVESTORS

Eligible Investors can exchange shares in a Fund for shares of any
other Fund at any time. (An exchange is a simultaneous redemption of shares in
one Fund and a purchase of shares in another Fund.) If you hold shares through a
TIAA-CREF Intermediary or other Eligible Investor, contact the Eligible Investor
for applicable exchange requirements. Exchanges between accounts can be made
only if the accounts are registered in the same name(s), address and Social
Security or Tax Identification Number. An exchange is considered a sale of
securities, and therefore is a taxable event.

We reserve the right, at our sole discretion, to reject any exchange
request and to modify, suspend, or terminate the exchange privilege at any time.

Eligible Investors can make an exchange through a letter or instruction
delivered to one of the addresses listed in "Purchases by Eligible Investors"
(page 25) or through a telephone request by calling _______________. The letter
must include the Eligible Investor's name, address and the Funds the Eligible
Investor wants to exchange between. Once made, an exchange request cannot be
modified or canceled.

27
<PAGE> 32

MAKING EXCHANGES THROUGH THE TRUST COMPANY

If you purchased shares through the Trust Company, it is responsible
for making any exchanges on your behalf. In addition, the Trust Company may
impose its own restrictions on your ability to make exchanges. Please contact
the Trust Company directly for more information.

OTHER INVESTOR INFORMATION

Good Order. Requests for transactions by Eligible Investors will not be
processed until they are received in good order by our transfer agent, Boston
Financial Data Services. "Good order" means that an Eligible Investor's
transaction request includes its Fund account number, the amount of the
transaction (in dollars or shares), signatures of all account owners exactly as
registered on the account, and any other supporting legal documentation that may
be required.

Share Price. The share price we use for transactions will be the NAV
per share next calculated after Boston Financial Data Services receives an
Eligible Investor's request in good order. If an Eligible Investor purchases or
redeems shares anytime before the New York Stock Exchange closes (usually 4:00
p.m. Eastern Time), the transaction price will be the NAV per share for that
day. If an Eligible Investor makes a purchase or redemption request after the
New York Stock Exchange closes, the transaction price will be the NAV per share
for the next business day. If you purchased shares through an Eligible Investor,
the Eligible Investor (including the Trust Company) may require you to
communicate to it any purchase or redemption request before a specified deadline
earlier than 4:00 p.m. in order to receive that day's NAV per share as the
transaction price.

Tax Identification Number. Each Eligible Investor must provide its
Taxpayer Identification Number (which, for most individuals, is your Social
Security Number) to us and indicate whether or not it is subject to back-up
withholding. If an Eligible Investor doesn't furnish its Taxpayer Identification
Number, redemptions and exchanges of shares, as well as dividends and capital
gains distributions, will be subject to back-up tax withholding.

Signature Guarantee. For some transaction requests by an Eligible
Investor, we may require a signature guarantee of the Eligible Investor. This
requirement is designed to protect you and the TIAA-CREF Institutional Mutual
Funds from fraud, and to comply with rules on stock transfers.

Transferring Shares. An Eligible Investor may transfer ownership of its
shares to another person or organization that also qualifies as an Eligible
Investor or may change the name on its account by sending us written
instructions. All registered owners of the account must sign the request and
provide signature guarantees.

28
<PAGE> 33

FINANCIAL HIGHLIGHTS

Because the Funds have limited operating history, no financial
highlights information is included in this prospectus. Financial statements for
each Fund are in the SAI, which is available free upon request.

29
<PAGE> 34
[BACK COVER]

FOR MORE INFORMATION ABOUT TIAA-CREF INSTITUTIONAL MUTUAL FUNDS

The following documents contain more information about the Funds and
are available free upon request:

STATEMENT OF ADDITIONAL INFORMATION ("SAI"). The SAI contains more information
about all aspects of the Funds. A current SAI has been filed with the U.S.
Securities and Exchange Commission ("SEC") and is incorporated in this
prospectus by reference.

ANNUAL AND SEMI-ANNUAL REPORTS. The Funds' annual and semi-annual reports
provide additional information about the Funds' investments. The first annual
report, to be available in November 2000, will contain a discussion of the
market conditions and investment strategies that significantly affected each
Fund's performance during the preceding fiscal year.

REQUESTING DOCUMENTS. You can request a copy of the SAI or these reports, or
contact us for any other purpose, in any of the following ways:

By telephone: Call 800 ____-______

In writing: TIAA-CREF Institutional Mutual Funds
c/o State Street Bank and Trust Company
P.O. Box 8009
Boston, MA 02266-8009

Information about TIAA-CREF Institutional Mutual Funds (including the SAI) can
be reviewed and copied at the SEC's public reference room (1-800-SEC-0339) in
Washington, D.C. The reports and other information are also available through
the SEC's internet website at www.sec.gov. Copies of the information can also be
obtained, upon payment of a duplicating fee, by writing the SEC's Public
Reference Section, Washington, D.C. 20549-6009.

Investment Company Act File No. 811-
----------

<PAGE> 35

TIAA-CREF INSTITUTIONAL MUTUAL FUNDS

STATEMENT OF ADDITIONAL INFORMATION

This Statement of Additional Information ("SAI") contains additional
information that you should consider before investing in TIAA-CREF Institutional
Mutual Funds (the "Trust"). It is not a prospectus and should be read carefully
in conjunction with the Trust's prospectus dated July ___, 1999 (the
"Prospectus"), which may be obtained by writing us at TIAA-CREF Institutional
Mutual Funds, c/o State Street Bank and Trust Company, P.O. Box 9081, Boston, MA
02266 or by calling 800 223-1200. Terms used in the Prospectus are incorporated
in this SAI.

The date of this SAI is July ___, 1999.

<PAGE> 36
TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
INVESTMENT OBJECTIVES, POLICIES, AND RESTRICTIONS.................................................................1
Fundamental Policies.....................................................................................1
Investment Policies and Risk Considerations..............................................................2

MANAGEMENT OF TIAA-CREF INSTITUTIONAL MUTUAL FUNDS...............................................................14
Trustees and Officers of TIAA-CREF Institutional Mutual Funds...........................................14
Trustee and Officer Compensation........................................................................17

PRINCIPAL HOLDERS OF SECURITIES..................................................................................18

INVESTMENT ADVISORY AND OTHER SERVICES...........................................................................19

ABOUT TIAA-CREF INSTITUTIONAL MUTUAL FUNDS AND THE SHARES........................................................19
Indemnification of Shareholders.........................................................................20
Indemnification of Trustees.............................................................................20
Limitation of Fund Liability............................................................................20
Shareholder Meetings and Voting Rights..................................................................21
Additional Portfolios...................................................................................21
Dividends and Distributions.............................................................................21

PRICING OF SHARES................................................................................................21
Investments for Which Market Quotations Are Readily Available...........................................22
Foreign Investments.....................................................................................22
Debt Securities.........................................................................................22
Special Valuation Procedures for the Institutional Money Market Fund....................................22
Options and Futures.....................................................................................23
Investments for Which Market Quotations Are Not Readily Available.......................................24

TAX STATUS.......................................................................................................24

BROKERAGE ALLOCATION.............................................................................................26

UNDERWRITERS.....................................................................................................27

CALCULATION OF PERFORMANCE DATA..................................................................................27
Total Return Calculations...............................................................................28
Yield Calculations......................................................................................28
Performance Comparisons.................................................................................30
Illustrating Compounding................................................................................30
Net Asset Value.........................................................................................31
Moving Averages.........................................................................................31

VOTING RIGHTS....................................................................................................31
</TABLE>

- ii -

<PAGE> 37

<TABLE>
<S> <C>
LEGAL MATTERS....................................................................................................31

EXPERTS..........................................................................................................31

ADDITIONAL CONSIDERATIONS........................................................................................31

FINANCIAL STATEMENTS.............................................................................................32
</TABLE>

- iii -
<PAGE> 38

INVESTMENT OBJECTIVES, POLICIES, AND RESTRICTIONS

The following discussion of investment policies and restrictions
supplements the Prospectus descriptions of the investment objective and
principal investment strategies of each of the Trust's seven separate investment
portfolios or funds ("Funds"). Under the Investment Company Act of 1940, as
amended (the "1940 Act"), any fundamental policy of a registered investment
company may not be changed without the vote of a majority of the outstanding
voting securities (as defined in the 1940 Act) of that series. However, each
Fund's investment objective, policies and principal investment strategies
described in the Prospectus, as well as the investment restrictions contained in
"Investment Policies and Risk Considerations" below, are not fundamental and
therefore may be changed by the Trust's board of trustees (the "Board of
Trustees" or the "Board") at any time. Each Fund will be "diversified" within
the meaning of the 1940 Act.

Unless stated otherwise, each of the following investment policies and
risk considerations apply to each Fund.

FUNDAMENTAL POLICIES

The following restrictions are fundamental policies of each Fund:

1. The Fund will not issue senior securities except as permitted
by law.

2. The Fund will not borrow money, except: (a) each Fund may
purchase securities on margin, as described in restriction 7
below; and (b) from banks (only in amounts not in excess of
33 1/3 percent of the market value of that Fund's assets at
the time of borrowing), and, from other sources, for
temporary purposes (only in amounts not exceeding 5 percent,
or such greater amount as may be permitted by law, of that
Fund's total assets taken at market value at the time of
borrowing).

3. The Fund will not underwrite the securities of other
companies, except to the extent that it may be deemed an
underwriter in connection with the disposition of securities
from its portfolio.

4. The Fund will not purchase real estate or mortgages directly.

5. The Fund will not purchase commodities or commodities
contracts, except to the extent futures are purchased as
described herein.

6. The Fund will not lend any security or make any other loan if,
as a result, more than 33 1/3 percent of its total assets
would be lent to other parties, but this limit does not apply
to repurchase agreements.

7. The Fund will not purchase any security on margin except that
the Fund may obtain such short-term credit as may be necessary
for the clearance of purchases and sales of portfolio
securities.

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<PAGE> 39

8. The Fund will not, with respect to at least 75 percent of the
value of its total assets, invest more than 5 percent of its
total assets in the securities of any one issuer, other than
securities issued or guaranteed by the United States
Government, its agencies or instrumentalities, or hold more
than 10 percent of the outstanding voting securities of any
one issuer.

The following restriction is a fundamental policy of each Fund other
than the Institutional Money Market Fund.

9. The Fund will not invest in an industry if after giving effect
to that investment that Fund's holding in that industry would
exceed 25 percent of its total assets.

The following restriction is a fundamental policy of the Institutional
Money Market Fund:

10. The Fund may invest more than 25 percent of its assets in
obligations issued or guaranteed by the U.S. government, its
agencies or instrumentalities; the Fund will not otherwise
invest in an industry if after giving effect to that
investment the Fund's holding in that industry would exceed 25
percent of its total assets.

INVESTMENT POLICIES AND RISK CONSIDERATIONS

The following restrictions are non-fundamental policies of each Fund.
These restrictions may be changed without the approval of the shareholders in
the affected Fund.

Non-Equity Investments of the Equity Funds. The equity Funds can, in
addition to stocks, hold other types of securities with equity characteristics,
such as convertible bonds, preferred stock, warrants and depository receipts or
rights. Pending more permanent investments or to use cash balances effectively,
these Funds can hold the same types of money market instruments the
Institutional Money Market Fund invests in (see Prospectus, page __), as well as
other short-term instruments. These other instruments are the same type of
instruments the Institutional Money Market Fund holds, but they have longer
maturities than the instruments allowed in the Institutional Money Market Fund,
or else don't meet the requirements for "First Tier Securities" (see Prospectus,
page __).

When market conditions warrant, the equity Funds can invest directly in
debt securities similar to those the Institutional Bond Fund may invest in (see
Prospectus, page __). The equity Funds can also hold debt securities that they
acquire because of mergers, recapitalizations or otherwise.

Borrowing and Lending Among Affiliates. At some time in the future, the
Funds may establish a facility for borrowing and lending money among themselves
as well as with TIAA or other registered investment companies managed by
Advisors or Investment Management.

If a Fund borrows money, it could leverage its portfolio by keeping
securities it might otherwise have had to sell. Leveraging exposes a Fund to
special risks, including greater

- 2 -
<PAGE> 40

fluctuations in net asset value in response to market changes.

Illiquid Securities. Each Fund can invest up to 15 percent of its
assets (10 percent for the Institutional Money Market Fund) in investments that
may not be readily marketable. It may be difficult to sell these investments for
their fair market value.

Preferred Stock. The Funds can invest in preferred stock consistent
with their investment objectives.

Options and Futures. Each of the Funds may engage in options and
futures strategies to the extent permitted by the SEC and Commodity Futures
Trading Commission ("CFTC"). We do not intend for any Fund to use options and
futures strategies in a speculative manner but rather we would use them
primarily as hedging techniques or for cash management purposes.

Option-related activities could include: (1) selling of covered call
option contracts, and the purchase of call option contracts for the purpose of a
closing purchase transaction; (2) buying covered put option contracts, and
selling put option contracts to close out a position acquired through the
purchase of such options; and (3) selling call option contracts or buying put
option contracts on groups of securities and on futures on groups of securities
and buying similar call option contracts or selling put option contracts to
close out a position acquired through a sale of such options. This list of
options-related activities is not intended to be exclusive, and each Fund may
engage in other types of options transactions consistent with its investment
objective and policies and applicable law.

A call option is a short-term contract (generally for nine months or
less) which gives the purchaser of the option the right to purchase the
underlying security at a fixed exercise price at any time (American style) or at
a set time (European style) prior to the expiration of the option regardless of
the market price of the security during the option period. As consideration for
the call option, the purchaser pays the seller a premium, which the seller
retains whether or not the option is exercised. The seller of a call option has
the obligation, upon the exercise of the option by the purchaser, to sell the
underlying security at the exercise price at any time during the option period.
Selling a call option would benefit the seller if, over the option period, the
underlying security declines in value or does not appreciate above the aggregate
of the exercise price and the premium. However, the seller risks an "opportunity
loss" of profits if the underlying security appreciates above the aggregate
value of the exercise price and the premium.

A Fund may close out a position acquired through selling a call option
by buying a call option on the same security with the same exercise price and
expiration date as the call option that it had previously sold on that security.
Depending on the premium for the call option purchased by the Fund, the Fund
will realize a profit or loss on the transaction.

A put option is a similar short-term contract that gives the purchaser
of the option the right to sell the underlying security at a fixed exercise
price prior to the expiration of the option regardless of the market price of
the security during the option period. As consideration for the put option, the
purchaser pays the seller a premium, which the seller retains whether or not the
option is exercised. The seller of a put option has the obligation, upon the
exercise of the option

- 3 -
<PAGE> 41

by the purchaser, to purchase the underlying security at the exercise price
during the option period. The buying of a covered put contract limits the
downside exposure for the investment in the underlying security to the
combination of the exercise price less the premium paid. The risk of purchasing
a put is that the market price of the underlying stock prevailing on the
expiration date may be above the option's exercise price. In that case the
option would expire worthless and the entire premium would be lost.

A Fund may close out a position acquired through buying a put option by
selling a put option on the same security with the same exercise price and
expiration date as the put option which it had previously bought on the
security. Depending on the premium of the put option sold by the Fund, the Fund
would realize a profit or loss on the transaction.

In addition to options (both calls and puts) on individual securities,
there are also options on groups of securities, such as the Standard & Poor's
100 Index traded on the Chicago Board Options Exchange. There are also options
on futures of groups of securities such as the Standard & Poor's 500 Stock Index
and the New York Stock Exchange Composite Index. The selling of calls can be
used in anticipation of, or in, a general market or market sector decline that
may adversely affect the market value of a Fund's portfolio of securities. To
the extent that a Fund's portfolio of securities changes in value in correlation
with a given stock index, the sale of call options on the futures of that index
would substantially reduce the risk to the portfolio of a market decline, and,
by so doing, provides an alternative to the liquidation of securities positions
in the portfolio with resultant transaction costs. A risk in all options,
particularly the relatively new options on groups of securities and on futures
on groups of securities, is a possible lack of liquidity. This will be a major
consideration before a Fund deals in any option.

There is another risk in connection with selling a call option on a
group of securities or on the futures of groups of securities. This arises
because of the imperfect correlation between movements in the price of the call
option on a particular group of securities and the price of the underlying
securities held in the portfolio. Unlike a covered call on an individual
security, where a large movement on the upside for the call option will be
offset by a similar move on the underlying stock, a move in the price of a call
option on a group of securities may not be offset by a similar move in the price
of securities held due to the difference in the composition of the particular
group and the portfolio itself.

To the extent permitted by applicable regulatory authorities, each Fund
may purchase and sell futures contracts on securities or other instruments, or
on groups or indexes of securities or other instruments. The purpose of hedging
techniques using financial futures is to protect the principal value of a Fund
against adverse changes in the market value of securities or instruments in its
portfolio, and to obtain better returns on future investments than actually may
be available at the future time. Since these are hedging techniques, the gains
or losses on the futures contract normally will be offset by losses or gains,
respectively, on the hedged investment. Futures contracts also may be offset
prior to the future date by executing an opposite futures contract transaction.

A futures contract on an investment is a binding contractual commitment
which, if held to maturity, will result in an obligation to make or accept
delivery, during a particular future

- 4 -
<PAGE> 42

month, of the securities or instrument underlying the contract. By purchasing a
futures contract -- assuming a "long" position -- a Fund legally will obligate
itself to accept the future delivery of the underlying security or instrument
and pay the agreed price. By selling a futures contract -- assuming a "short"
position -- it legally will obligate itself to make the future delivery of the
security or instrument against payment of the agreed price.

Positions taken in the futures markets are not normally held to
maturity, but are instead liquidated through offsetting transactions which may
result in a profit or a loss. While futures positions taken by a Fund usually
will be liquidated in this manner, a Fund may instead make or take delivery of
the underlying securities or instruments whenever it appears economically
advantageous to the Fund to do so. A clearing corporation associated with the
exchange on which futures are traded assumes responsibility for closing out
positions and guarantees that the sale and purchase obligations will be
performed with regard to all positions that remain open at the termination of
the contract.

A stock index futures contract, unlike a contract on a specific
security, does not provide for the physical delivery of securities, but merely
provides for profits and losses resulting from changes in the market value of
the contract to be credited or debited at the close of each trading day to the
respective accounts of the parties to the contract. On the contract's expiration
date, a final cash settlement occurs and the futures positions are closed out.
Changes in the market value of a particular stock index futures contract reflect
changes in the specified index of equity securities on which the future is
based.

Stock index futures may be used to hedge the equity investments of each
Fund with regard to market (systematic) risk (involving the market's assessment
of overall economic prospects), as distinguished from stock specific risk
(involving the market's evaluation of the merits of the issuer of a particular
security). By establishing an appropriate "short" position in stock index
futures, a Fund may seek to protect the value of its securities portfolio
against an overall decline in the market for equity securities. Alternatively,
in anticipation of a generally rising market, a Fund can seek to avoid losing
the benefit of apparently low current prices by establishing a "long" position
in stock index futures and later liquidating that position as particular equity
securities are in fact acquired. To the extent that these hedging strategies are
successful, a Fund will be affected to a lesser degree by adverse overall market
price movements, unrelated to the merits of specific portfolio equity
securities, than would otherwise be the case.

Unlike the purchase or sale of a security, no price is paid or received
by a Fund upon the purchase or sale of a futures contract. Initially, the Fund
will be required to deposit in a custodial account an amount of cash, United
States Treasury securities, or other permissible assets equal to approximately 5
percent of the contract amount. This amount is known as "initial margin." The
nature of initial margin in futures transactions is different from that of
margin in security transactions in that futures contract margin does not involve
the borrowing of funds by the customer to finance the transactions. Rather, the
initial margin is in the nature of a performance bond or good faith deposit on
the contract which is returned to the Fund upon termination of the futures
contract assuming all contractual obligations have been satisfied. Subsequent
payments to and from the broker, called "variation margin," will be made on a
daily basis as the price of the underlying stock index fluctuates making the
long and short positions in the futures

- 5 -
<PAGE> 43

contract more or less valuable, a process known as "marking to the market." For
example, when a Fund has purchased a stock index futures contract and the price
of the underlying stock index has risen, that position will have increased in
value, and the Fund will receive from the broker a variation margin payment
equal to that increase in value. Conversely, where a Fund has purchased a stock
index futures contract and the price of the underlying stock index has declined,
the position would be less valuable and the Fund would be required to make a
variation margin payment to the broker. At any time prior to expiration of the
futures contract, the Fund may elect to close the position by taking an opposite
position which will operate to terminate the Fund's position in the futures
contract. A final determination of variation margin is then made, additional
cash is required to be paid by or released to the Fund, and the Fund realizes a
loss or a gain.

There are several risks in connection with the use of a futures
contract as a hedging device. One risk arises because of the imperfect
correlation between movements in the prices of the futures contracts and
movements in the securities or instruments which are the subject of the hedge.
Each Fund will attempt to reduce this risk by engaging in futures transactions,
to the extent possible, where, in our judgment, there is a significant
correlation between changes in the prices of the futures contracts and the
prices of each Fund's portfolio securities or instruments sought to be hedged.

Successful use of futures contracts for hedging purposes also is
subject to the user's ability to predict correctly movements in the direction of
the market. For example, it is possible that, where a Fund has sold futures to
hedge its portfolio against declines in the market, the index on which the
futures are written may advance and the values of securities or instruments held
in the Fund's portfolio may decline. If this occurred, the Fund would lose money
on the futures and also experience a decline in value in its portfolio
investments. However, we believe that over time the value of a Fund's portfolio
will tend to move in the same direction as the market indices which are intended
to correlate to the price movements of the portfolio securities or instruments
sought to be hedged. It also is possible that, for example, if a Fund has hedged
against the possibility of the decline in the market adversely affecting stocks
held in its portfolio and stock prices increased instead, the Fund will lose
part or all of the benefit of increased value of those stocks that it has hedged
because it will have offsetting losses in its futures positions. In addition, in
such situations, if the Fund has insufficient cash, it may have to sell
securities or instruments to meet daily variation margin requirements. Such
sales may be, but will not necessarily be, at increased prices which reflect the
rising market. The Fund may have to sell securities or instruments at a time
when it may be disadvantageous to do so.

In addition to the possibility that there may be an imperfect
correlation, or no correlation at all, between movements in the futures
contracts and the portion of the portfolio being hedged, the prices of futures
contracts may not correlate perfectly with movements in the underlying security
or instrument due to certain market distortions. First, all transactions in the
futures market are subject to margin deposit and maintenance requirements.
Rather than meeting additional margin deposit requirements, investors may close
futures contracts through offsetting transactions which could distort the normal
relationship between the index and futures markets. Second, the margin
requirements in the futures market are less onerous than margin requirements in
the securities market, and as a result the futures market may attract more
speculators than the

- 6 -
<PAGE> 44

securities market does. Increased participation by speculators in the futures
market also may cause temporary price distortions. Due to the possibility of
price distortion in the futures market and also because of the imperfect
correlation between movements in the futures contracts and the portion of the
portfolio being hedged, even a correct forecast of general market trends by
Teachers Advisors, Inc. ("Advisors"), the investment adviser for TIAA-CREF
Institutional Mutual Funds, still may not result in a successful hedging
transaction over a very short time period.

Each Fund may also use futures contracts and options on futures
contracts to manage its cash flow more effectively. To the extent that a Fund
enters into non-hedging positions, it will do so only in accordance with certain
CFTC exemptive provisions. Thus, pursuant to CFTC Rule 4.5, the aggregate
initial margin and premiums required to establish non-hedging positions in
commodity futures or commodity options contracts may not exceed 5 percent of the
liquidation value of the Fund's portfolio, after-taking into account unrealized
profits and unrealized losses on any such contracts it has entered into
(provided that the in-the-money amount of an option that is in-the-money when
purchased may be excluded in computing such 5 percent).

Options and futures transactions may increase a Fund's transaction
costs and portfolio turnover rate and will be initiated only when consistent
with its investment objectives.

Investment Companies. Each Fund can invest up to 5 percent of its
assets in any single investment company and up to 10 percent of its assets in
all other investment companies in the aggregate. However, no Fund can hold more
than 3 percent of the total outstanding voting stock of any single investment
company.

Firm Commitment Agreements and Purchase of "When-Issued" Securities.
Each Fund can enter into firm commitment agreements for the purchase of
securities on a specified future date. When a Fund enters into a firm commitment
agreement, liability for the purchase price -- and the rights and risks of
ownership of the securities -- accrues to the Fund at the time it becomes
obligated to purchase such securities, although delivery and payment occur at a
later date. Accordingly, if the market price of the security should decline, the
effect of the agreement would be to obligate the Fund to purchase the security
at a price above the current market price on the date of delivery and payment.
During the time the Fund is obligated to purchase such securities, it will be
required to segregate assets. See below, "Segregated Accounts."

Pass-Through Securities. The Funds may invest in mortgage pass-through
securities such as GNMA certificates or FNMA and FHLMC mortgage-backed
obligations, or modified pass-through securities such as collateralized mortgage
obligations issued by various financial institutions. In connection with these
investments, early repayment of principal arising from prepayments of principal
on the underlying mortgage loans due to the sale of the underlying property, the
refinancing of the loan, or foreclosure may expose a Fund to a lower rate of
return upon reinvestment of the principal. Prepayment rates vary widely and may
be affected by changes in market interest rates. In periods of falling interest
rates, the rate of prepayment tends to increase, thereby shortening the actual
average life of the mortgage-related security. Conversely, when interest rates
are rising, the rate of prepayment tends to decrease, thereby

- 7 -
<PAGE> 45

lengthening the actual average life of the mortgage-related security.
Accordingly, it is not possible to accurately predict the average life of a
particular pool. Reinvestment of prepayments may occur at higher or lower rates
than the original yield on the certificates. Therefore, the actual maturity and
realized yield on pass-through or modified pass-through mortgage-related
securities will vary based upon the prepayment experience of the underlying pool
of mortgages. For purposes of calculating the average life of the assets of the
relevant Fund, the maturity of each of these securities will be the average life
of such securities based on the most recent or estimated annual prepayment rate.

Lending of Securities. Subject to investment policy 6 on page 1
(relating to loans of portfolio securities), each Fund may lend its securities
to brokers and dealers that are not affiliated with Teachers Insurance and
Annuity Association of America ("TIAA"), are registered with the SEC and are
members of the NASD, and also to certain other financial institutions. All loans
will be fully collateralized. In connection with the lending of its securities,
a Fund will receive as collateral cash, securities issued or guaranteed by the
United States Government (i.e., Treasury securities), or other collateral
permitted by applicable law, which at all times while the loan is outstanding
will be maintained in amounts equal to at least 102 percent of the current
market value of the loaned securities, or such lesser percentage as may be
permitted by the Securities and Exchange Commission ("SEC") (not to fall below
100 percent of the market value of the loaned securities), as reviewed daily. By
lending its securities, a Fund will receive amounts equal to the interest or
dividends paid on the securities loaned and in addition will expect to receive a
portion of the income generated by the short-term investment of cash received as
collateral or, alternatively, where securities or a letter of credit are used as
collateral, a lending fee paid directly to the Fund by the borrower of the
securities. Such loans will be terminable by the Fund at any time and will not
be made to affiliates of TIAA. The Fund may terminate a loan of securities in
order to regain record ownership of, and to exercise beneficial rights related
to, the loaned securities, including but not necessarily limited to voting or
subscription rights, and may, in the exercise of its fiduciary duties, terminate
a loan in the event that a vote of holders of those securities is required on a
material matter. The Fund may pay reasonable fees to persons unaffiliated with
the Fund for services or for arranging such loans. Loans of securities will be
made only to firms deemed creditworthy. As with any extension of credit,
however, there are risks of delay in recovering the loaned securities, should
the borrower of securities default, become the subject of bankruptcy
proceedings, or otherwise be unable to fulfill its obligations or fail
financially.

Repurchase Agreements. Repurchase agreements have the characteristics
of loans, and will be fully collateralized (either with physical securities or
evidence of book entry transfer to the account of the custodian bank) at all
times. During the term of the repurchase agreement, the Fund entering into the
agreement retains the security subject to the repurchase agreement as collateral
securing the seller's repurchase obligation, continually monitors the market
value of the security subject to the agreement, and requires the Fund's seller
to deposit with the Fund additional collateral equal to any amount by which the
market value of the security subject to the repurchase agreement falls below the
resale amount provided under the repurchase agreement. Each Fund will enter into
repurchase agreements only with member banks of the Federal Reserve System, and
with primary government securities dealers or other domestic or foreign
broker-dealers whose creditworthiness has been reviewed and found satisfactory
by Advisors

- 8 -
<PAGE> 46

and who have, therefore, been determined to present minimal credit risk.

Securities underlying repurchase agreements will be limited to
certificates of deposit, commercial paper, bankers' acceptances, or obligations
issued or guaranteed by the United States Government or its agencies or
instrumentalities, in which the Fund entering into the agreement may otherwise
invest.

If a seller of a repurchase agreement defaults and does not repurchase
the security subject to the agreement, the Fund entering into the agreement
would look to the collateral security underlying the seller's repurchase
agreement, including the securities subject to the repurchase agreement, for
satisfaction of the seller's obligation to the Fund; in such event the Fund
might incur disposition costs in liquidating the collateral and might suffer a
loss if the value of the collateral declines. In addition, if bankruptcy
proceedings are instituted against a seller of a repurchase agreement,
realization upon the collateral may be delayed or limited.

Swap Transactions. Each Fund may, to the extent permitted by the SEC,
enter into privately negotiated "swap" transactions with other financial
institutions in order to take advantage of investment opportunities generally
not available in public markets. In general, these transactions involve
"swapping" a return based on certain securities, instruments, or financial
indices with another party, such as a commercial bank, in exchange for a return
based on different securities, instruments, or financial indices.

By entering into a swap transaction, a Fund may be able to protect the
value of a portion of its portfolio against declines in market value. Each Fund
may also enter into swap transactions to facilitate implementation of allocation
strategies between different market segments or countries or to take advantage
of market opportunities which may arise from time to time. A Fund may be able to
enhance its overall performance if the return offered by the other party to the
swap transaction exceeds the return swapped by the Fund. However, there can be
no assurance that the return a Fund receives from the counterparty to the swap
transaction will exceed the return it swaps to that party.

While a Fund will only enter into swap transactions with counterparties
it considers creditworthy (and will monitor the creditworthiness of parties with
which it enters into swap transactions), a risk inherent in swap transactions is
that the other party to the transaction may default on its obligations under the
swap agreement. If the other party to the swap transaction defaults on its
obligations, the Fund entering into the agreement would be limited to the
agreement's contractual remedies. There can be no assurance that a Fund will
succeed when pursuing its contractual remedies. To minimize a Fund's exposure in
the event of default, it will usually enter into swap transactions on a net
basis (i.e., the parties to the transaction will net the payments payable to
each other before such payments are made). When a Fund enters into swap
transactions on a net basis, the net amount of the excess, if any, of the Fund's
obligations over its entitlements with respect to each such swap agreement will
be accrued on a daily basis and an amount of liquid assets having an aggregate
market value at least equal to the accrued excess will be segregated by the
Fund's custodian. To the extent a Fund enters into swap transactions other than
on a net basis, the amount segregated will be the full amount of the Fund's
obligations, if any, with respect to each such swap agreement, accrued on a
daily basis. See "Segregated

- 9 -
<PAGE> 47

Accounts," below.

Swap agreements may be considered illiquid by the SEC staff and subject
to the limitations on illiquid investments.

To the extent that there is an imperfect correlation between the return
a Fund is obligated to swap and the securities or instruments representing such
return, the value of the swap transaction may be adversely affected. No Fund
therefore will enter into a swap transaction unless it owns or has the right to
acquire the securities or instruments representative of the return it is
obligated to swap with the counterparty to the swap transaction. It is not the
intention of any Fund to engage in swap transactions in a speculative manner but
rather primarily to hedge or manage the risks associated with assets held in, or
to facilitate the implementation of portfolio strategies of purchasing and
selling assets for, the Fund.

Segregated Accounts. In connection with when-issued securities, firm
commitment and certain other transactions in which a Fund incurs an obligation
to make payments in the future, a Fund may be required to segregate assets with
its custodian bank in amounts sufficient to settle the transaction. To the
extent required, such segregated assets can consist of liquid assets, including
equity or other securities, or other instruments such as cash, United States
Government securities or other securities as may be permitted by law.

Currency Transactions. The value of a Fund's assets as measured in
United States dollars may be affected favorably or unfavorably by changes in
foreign currency exchange rates and exchange control regulations, and the Fund
may incur costs in connection with conversions between various currencies. To
minimize the impact of such factors on net asset values, the Fund may engage in
foreign currency transactions in connection with their investments in foreign
securities. The Funds will not speculate in foreign currency exchange, and will
enter into foreign currency transactions only to "hedge" the currency risk
associated with investing in foreign securities. Although such transactions tend
to minimize the risk of loss due to a decline in the value of the hedged
currency, they also may limit any potential gain which might result should the
value of such currency increase.

The Funds will conduct their currency exchange transactions either on a
spot (i.e., cash) basis at the rate prevailing in the currency exchange market,
or through forward contracts to purchase or sell foreign currencies. A forward
currency contract involves an obligation to purchase or sell a specific currency
at a future date, which may be any fixed number of days from the date of the
contract agreed upon by the parties, at a price set at the time of the contract.
These contracts are entered into with large commercial banks or other currency
traders who are participants in the interbank market.

By entering into a forward contract for the purchase or sale of foreign
currency involved in underlying security transactions, a Fund is able to protect
itself against possible loss between trade and settlement dates for that
purchase or sale resulting from an adverse change in the relationship between
the U.S. dollar and such foreign currency. This practice is sometimes referred
to as "transaction hedging." In addition, when it appears that a particular
foreign currency may suffer a substantial decline against the U.S. dollar, a
Fund may enter into a forward

- 10 -
<PAGE> 48

contract to sell an amount of foreign currency approximating the value of some
or all of its portfolio securities denominated in such foreign currency. This
practice is sometimes referred to as "portfolio hedging." Similarly, when it
appears that the U.S. dollar may suffer a substantial decline against a foreign
currency, a Fund may enter into a forward contract to buy that foreign currency
for a fixed dollar amount.

The Funds may also hedge their foreign currency exchange rate risk by
engaging in currency financial futures, options and "cross-hedge" transactions.
In "cross-hedge" transactions, a Fund holding securities denominated in one
foreign currency will enter into a forward currency contract to buy or sell a
different foreign currency (one that generally tracks the currency being hedged
with regard to price movements). Such cross-hedges are expected to help protect
a Fund against an increase or decrease in the value of the U.S. dollar against
certain foreign currencies.

The Funds may hold a portion of their respective assets in bank
deposits denominated in foreign currencies, so as to facilitate investment in
foreign securities as well as protect against currency fluctuations and the need
to convert such assets into U.S. dollars (thereby also reducing transaction
costs). To the extent these monies are converted back into U.S. dollars, the
value of the assets so maintained will be affected favorably or unfavorably by
changes in foreign currency exchange rates and exchange control regulations.

The forecasting of short-term currency market movement is extremely
difficult and whether a short-term hedging strategy will be successful is highly
uncertain. Moreover, it is impossible to forecast with absolute precision the
market value of portfolio securities at the expiration of a foreign currency
forward contract. Accordingly, a Fund may be required to buy or sell additional
currency on the spot market (and bear the expense of such transaction) if its
predictions regarding the movement of foreign currency or securities markets
prove inaccurate. In addition, the use of cross-hedging transactions may involve
special risks, and may leave a Fund in a less advantageous position than if such
a hedge had not been established. Because foreign currency forward contracts are
privately negotiated transactions, there can be no assurance that a Fund will
have flexibility to roll-over the foreign currency forward contract upon its
expiration if it desires to do so. Additionally, there can be no assurance that
the other party to the contract will perform its obligations thereunder.

There is no express limitation on the percentage of a Fund's assets
that may be committed to foreign currency exchange contracts. A Fund will not
enter into foreign currency forward contracts or maintain a net exposure in such
contracts where that Fund would be obligated to deliver an amount of foreign
currency in excess of the value of that Fund's portfolio securities or other
assets denominated in that currency or, in the case of a cross-hedge
transaction, denominated in a currency or currencies that Fund's investment
adviser believes will correlate closely to the currency's price movements. The
Funds generally will not enter into forward contracts with terms longer than one
year.

Foreign Investments. As described more fully in the Prospectus, certain
Funds may invest in foreign securities, including those in emerging markets. In
addition to the general risk factors discussed in the Prospectus, there are a
number of country- or region-specific risks and

- 11 -
<PAGE> 49

other considerations that may affect these investments.

Investment in Europe. The total European market (consisting of the European
Union, the European Free Trade Association and Eastern European countries)
contains over 450 million consumers, a market larger than either the United
States or Japan. European businesses compete both intra-regionally and globally
in a wide range of industries, and recent political and economic changes
throughout Europe are likely further to expand the role of Europe in the global
economy. As a result, a great deal of interest and activity has been generated
aimed at understanding and benefiting from the "new" Europe that may result. The
incipient aspects of major developments in Europe as well as other
considerations means that there can be no guarantee that outcomes will be as
anticipated or will have results that investors would regard as favorable.

The European Union. The European Union ("EU") consists of Austria, Belgium,
Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,
Netherlands, Portugal, Spain, Sweden, and the United Kingdom (the "EU Nations"),
with a total population exceeding 370 million. The EU Nations have undertaken to
establish, among themselves, a single market that is largely free of internal
barriers and hindrances to the free movement of goods, persons, services and
capital. Although it is difficult to predict when this goal will be fully
realized, macro- and micro-economic adjustments already in train are indicative
of significant increases in efficiency and the ability of the EU Nations to
compete globally by simplifying product distribution networks, promoting
economies of scale, and increasing labor mobility, among other effects. The
establishment of the eleven-country European Monetary Union, a subset of the
European Union countries, with its own central bank, the European Central Bank;
its own currency, the Euro; and a single interest rate structure, represents a
new economic entity, the Euro-area. While authority for monetary policy thus
shifts from national hands to an independent supranational body, sovereignty
elsewhere remains at the national level. Uncertainties with regard to balancing
of monetary policy against national fiscal and other political issues and their
extensive ramifications represent important risk considerations for investors in
these countries.

Investment in the Pacific Basin. The economies of the Pacific Basin vary widely
in their stages of economic development. Some (such as Japan, Australia,
Singapore, and Hong Kong) are considered advanced by Western standards; others
(such as Thailand, Indonesia, and Malaysia) are considered "emerging" -- rapidly
shifting from natural resource- and agriculture-based systems to more
technologically advanced systems oriented toward manufacturing and services. The
major reform of China's economy and polity continues to be an important stimulus
to economic growth internally, and, through trade, across the region.
Intra-regional trade has become increasingly important to a number of these
economies. Japan, the second largest economy in the world, is the dominant
economy in the Pacific Basin, with one of the highest per capita incomes in the
world. Its extensive trade relationships also contribute to expectations for
regional and global economic growth. Economic growth has historically been
relatively strong in the region, but recent economic turmoil among the emerging
economies, and unmitigated recessionary impulses in Japan, in the recent past
have raised important questions with regard to prospective longer-term outcomes.
Potential policy miscalculations or other events could pose important risks to
equity investors in any of these economies.

- 12 -
<PAGE> 50

Investment in Canada. Canada, a country rich in natural resources and a leading
industrial country of the world, is by far the most important trading partner of
the United States. The U.S. and Canada have entered into the U.S.-Canada Free
Trade Agreement which, over a 10-year period from 1989, will remove trade
barriers affecting all important sectors of each country's economy. In addition,
the U.S., Canada, and Mexico have established the North American Free Trade
Agreement ("NAFTA"), which is expected to significantly benefit the economies of
each of the countries through the more rational allocation of resources and
production over the region. Uncertainty regarding the longer-run political
structure of Canada is an added risk to investors, along with weak commodity
prices.

Investment in Latin America. Latin America (including Mexico and Central
America) has a population of approximately 455 million and is rich in natural
resources. Important gains in the manufacturing sector have developed in several
of the major countries in the region. A number of countries in the region have
taken steps to reduce impediments to trade, most notably through the NAFTA
agreement between the U.S., Canada and Mexico and the Mercosur agreement between
Argentina, Brazil, Paraguay and Uruguay, with Chile as an associate member.
Restrictions on international capital flows, intermittent problems with capital
flight, and some potential difficulties in the repayment of external debt,
however, remain important concerns in the region -- exacerbating the risks in
these equity markets. As a result Latin American equity markets have been
extremely volatile. Efforts to restructure these economies through privatization
and fiscal and monetary reform have been met with some success, with gains in
output growth and slowing rates of inflation. These efforts may result in
attractive investment opportunities. However, recent events have shown that
large shifts in sentiment in markets elsewhere on the globe may very quickly
reverberate among these markets, adding greater risk to already volatile
markets. There can be no assurance that attempted reforms will ultimately be
successful or will bring about results investors would regard as favorable.

Other Regions. There are developments in other regions and countries around the
world which could lead to additional investment opportunities. We will monitor
these developments and may invest when appropriate.

Depository Receipts. The equity Funds can invest in American, European
and Global Depository Receipts ("ADRs," "EDRs" and "GDRs"). They are
alternatives to the purchase of the underlying securities in their national
markets and currencies. Although their prices are quoted in U.S. dollars, they
don't eliminate all the risks of foreign investing.

ADRs represent the right to receive securities of foreign issuers
deposited in a domestic bank or a foreign correspondent bank. To the extent that
a Fund acquires ADRs through banks which do not have a contractual relationship
with the foreign issuer of the security underlying the ADR to issue and service
such ADRs, there may be an increased possibility that the Fund would not become
aware of and be able to respond to corporate actions such as stock splits or
rights offerings involving the foreign issuer in a timely manner. In addition,
the lack of information may result in inefficiencies in the valuation of such
instruments. However, by investing in ADRs rather than directly in the stock of
foreign issuers, a Fund will avoid currency risks during the settlement period
for either purchases or sales. In general, there is a large, liquid market in
the U.S. for ADRs quoted on a national securities exchange or the NASD's
national

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<PAGE> 51

market system. The information available for ADRs is subject to the accounting,
auditing and financial reporting standards of the domestic market or exchange on
which they are traded, which standards are more uniform and more exacting than
those to which many foreign issuers may be subject.

EDRs and GDRs are receipts evidencing an arrangement with a non-U.S.
bank similar to that for ADRs and are designed for use in non-U.S. securities
markets. EDRs and GDRs are not necessarily quoted in the same currency as the
underlying security.

Other Investment Techniques and Opportunities. Each Fund may take
certain actions with respect to merger proposals, tender offers, conversion of
equity-related securities and other investment opportunities with the objective
of enhancing the portfolio's overall return, regardless of how these actions may
affect the weight of the particular securities in the Fund's portfolio.

Industry Concentrations. None of the Funds will concentrate more than
25 percent of its total assets in any one industry.

MANAGEMENT OF TIAA-CREF INSTITUTIONAL MUTUAL FUNDS

TRUSTEES AND OFFICERS OF TIAA-CREF INSTITUTIONAL MUTUAL FUNDS

Trustees who are "interested persons" within the meaning of the 1940
Act are indicated by an asterisk (*).

<TABLE>
<CAPTION>
TRUSTEE AGE PRINCIPAL OCCUPATIONS DURING PAST 5 YEARS
- ------- --- -----------------------------------------
<S> <C> <C>
Robert H. Atwell 68 President Emeritus, American Counsel on Education and
447 Bird Key Drive senior consultant for A.T. Kearney, since November
Sarasota, FL 34236 1996. Previously, President, American Counsel on
Education.

Elizabeth E. Bailey 60 John C. Hower Professor of Public Policy and
The Wharton School Management, The Wharton School of the University of
University of Pennsylvania Pennsylvania.
Suite 3100
Steinberg-Dietrich Hall
Philadelphia, PA 19104-6372

John H. Biggs* (3) 62 Chairman, Chief Executive Officer, and President,
TIAA-CREF College Retirement Equities Fund ("CREF") and TIAA,
730 Third Avenue since 1997. Previously, Chairman and Chief Executive
New York, NY 10017-3206 Officer, CREF and TIAA.

</TABLE>

- 14 -
<PAGE> 52
<TABLE>
<S> <C> <C>
Joyce A. Fecske (1) 52 Vice President Emerita, DePaul University, since
4800 South Karlov Avenue 1994. Formerly, Vice President for Human Resources,
Chicago, IL 60632 DePaul University.

Edes P. Gilbert 67 Consultant, Independent Education Services, since
Independent Education Services 1998. Formerly, Head, The Spence School.
49 East 78th Street
New York, NY 10021

Stuart Tse Kong Ho (3) 63 Chairman and President, Capital Investment of Hawaii,
Capital Investment of Hawaii, Inc. Inc.; Chairman, Gannett Pacific Corporation.
Suite 1700
733 Bishop Street
Honolulu, HI 96813

Nancy L. Jacob (2) 56 President and Managing Principal, Windermere
Windermere Investment Associates Investment Associates, since January 1997.
121 S.W. Morrison Street Previously, Chairman and Chief Executive Officer, CTC
Portland, OR 97204 Consulting, Inc. and Managing Director, Capital Trust
Company.

Marjorie Fine Knowles 59 Professor of Law, Georgia State University College of
College of Law Law.
Georgia State University
University Plaza
Atlanta, GA 30303-3092

Martin L. Leibowitz* (3) 63 Vice Chairman and Chief Investment Officer, CREF and
TIAA-CREF TIAA, since 1995. President, TIAA-CREF Investment
730 Third Avenue Management, Inc. (Investment Management), and
New York, NY 10017-3206 President, Teachers Advisors, Inc. (Advisors).
Executive Vice President, CREF and TIAA from June 1995
to November 1995. Formerly, managing
director-director of research and a member of the
executive committee, Salomon Brothers, Inc.

Jay O. Light (2) 57 Professor of Business Administration and Senior
Harvard Business School Associate Dean for Planning and Development, Harvard
Morgan Hall 489 University Graduate School of Business Administration.
Soldiers Field
Boston, MA 02163
</TABLE>

- 15 -
<PAGE> 53

<TABLE>
<S> <C> <C>
Bevis Longstreth (2)
Debevoise & Plimpton 65 Of Counsel, Debevoise & Plimpton, since 1998.
875 Third Avenue Formerly, Partner, Debevoise & Plimpton. Adjunct
New York, NY 10022 Professor of Law, Columbia University.

Robert M. Lovell, Jr. (2) 69 Founding Partner, First Quadrant L.P. Formerly,
First Quadrant L.P. Chairman and Chief Executive Officer, First Quadrant
100 Campus Drive Corp. (Investment Management Firm).
P.O. Box 939
Florham Park, NJ 07932

Stephen A. Ross (2) 55 Franco Modigliani Professor of Finance and Management,
Sloan School of Management Sloan School of Management, Massachusetts Institute of
Massachusetts Institute of Technology Technology, since 1998. Co-Chairman, Roll & Ross
77 Massachusetts Avenue Asset Management Corp.
Cambridge, MA 02139

Eugene C. Sit (3) 60 Chairman, Chief Executive and Chief Investment
Sit Investment Associates, Inc. Executive Officer, Sit Investment Associates, Inc. and
4600 Norwest Center Sit/Kim International Investment Associates, Inc.
90 South Seventh Street
Minneapolis, MN 55402

Maceo K. Sloan (2) 49 Chairman, President, and Chief Executive Officer,
NCM Capital Management Group, Inc. Sloan Financial Group, Inc., and NCM Capital
Suite 400 Management Group, Inc.
103 West Main Street
Durham, NC 27701-3638

David K. Storrs (2) 55 President and Chief Executive Officer, Alternative
Alternative Investment Group, LLC Investment Group, L.L.C., since August 1996. Adviser
65 South Gate Lane to the President, The Common Fund, since January
Southport, CT 06490 1996. Formerly, President and Chief Executive
Officer, The Common Fund.

Robert W. Vishny (3) 39 Eric J. Gleacher Professor of Finance, University of
Graduate School of Business Chicago Graduate School of Business. Founding
University of Chicago Partner, LSV Asset Management.
1101 East 58th Street
Chicago, IL 60637
</TABLE>

(1) Member of the Executive Committee. The Executive Committee is responsible
for day to day oversight of the Funds' operation.

(2) Member of the Finance Committee. The Finance Committee oversees the
investments of TIAA-CREF Institutional Mutual Funds.

- 16 -
<PAGE> 54

(3) Member of the Executive and Finance Committees.

<TABLE>
<CAPTION>
POSITION WITH
OFFICER* AGE REGISTRANT PRINCIPAL OCCUPATIONS DURING PAST 5 YEARS
- -------- --- ---------- -----------------------------------------
<S> <C> <C> <C>
John J. McCormack 54 President Executive Vice President, TIAA and CREF, since November
1983, and President, TIAA-CREF Enterprises, since
June 1998.

Scott C. Evans 40 Executive Executive Vice President, TIAA and CREF, Advisors and
Vice President Investment Management, since September 1997.
Previously, Managing Director, TIAA, CREF, Advisors and
Investment Management from March 1997 to September
1997. Previously Second Vice President, TIAA and CREF,
Advisors and Investment Management.

Richard L. Gibbs 52 Executive Executive Vice President, TIAA and CREF, since March
Vice President 1993. Executive Vice President, Advisors, Management,
Teachers Personal Investors Services, Inc.
("TPIS") and TIAA-CREF Individual & Institutional
Services, Inc. ("Services").

E. Laverne Jones 50 Secretary Vice President, and Corporate Secretary, TIAA and CREF,
since August 1998. Previously, Senior Counsel, TIAA
and CREF.

Richard J. Adamski 57 Vice President and Vice President and Treasurer, TIAA and CREF, Investment
Treasurer Management, Advisors, TPIS and Services.
</TABLE>

- -------------------------
* The address for all officers of TIAA-CREF Institutional Mutual Funds is
730 Third Avenue, New York, NY 10017-3206.

TRUSTEE AND OFFICER COMPENSATION

The following table shows the estimated compensation to be received by
each non-officer Trustee from the Funds and the TIAA-CREF fund complex for
TIAA-CREF Institutional Mutual Funds' partial fiscal year ending December 31,
1999. The Funds' officers receive no compensation from any fund in the TIAA-CREF
fund complex. The TIAA-CREF fund complex consists of: College Retirement
Equities Fund, TIAA Separate Account VA-1, TIAA-CREF Life Funds, TIAA-CREF
Mutual Funds and TIAA-CREF Institutional Mutual Funds, each a registered
investment company.

TIAA-CREF Institutional Mutual Funds has long-term performance deferred
compensation plan for non-employee Trustees. Under this unfunded plan, annual
contributions

- 17 -
<PAGE> 55

equal to half the amount of the basic annual Trustee stipend are allocated to
notional CREF and TIAA accounts, in predetermined percentages. Benefits will be
paid in a lump sum after the Trustee leaves the Board. Pursuant to a separate
deferred compensation plan, non-employee Trustees also have the option to defer
payment of their basic stipend and allocate it to notional TIAA and CREF
accounts chosen by the individual Trustee. Benefits under that plan are also
paid in a lump sum after the Trustee leaves the Board.

<TABLE>
<CAPTION>
LONG TERM PERFORMANCE
DEFERRED COMPENSATION TOTAL COMPENSATION
AGGREGATE COMPENSATION CONTRIBUTION FROM TIAA-CREF
NAME FROM THE FUND AS PART OF EXPENSES(1) [FUND] COMPLEX
- ---- ------------- ---------------------- --------------
<S> <C> <C> <C>
Robert H. Atwell $ $
Elizabeth E. Bailey $ $
Joyce A. Fecske $ $
Edes P. Gilbert $ $
Stuart Tse Kong Ho $ $
Nancy L. Jacob $ $
Marjorie Fine Knowles $ $
Jay O. Light $ $
Bevis Longstreth $ $
Robert M. Lovell, Jr. $ $
Stephen A. Ross $ $
Eugene C. Sit $ $
Maceo K. Sloan $ $
David K. Storrs $ $
Robert W. Vishny $ $
</TABLE>

- ---------------------------------
(1) Includes earnings, if any, on amounts contributed.

PRINCIPAL HOLDERS OF SECURITIES

TIAA, as the contributor of the initial capital for each of the Funds,
owned 100% of the shares of each Fund as of June 30, 1999.

INVESTMENT ADVISORY AND OTHER SERVICES

As explained in the Prospectus, investment advisory and related
services for each of the Funds are provided by personnel of Teachers Advisors,
Inc. ("Advisors"). Advisors manages the investment and reinvestment of the
assets of each Fund, subject to the direction and control of the Finance
Committee of the Board of Trustees. As the prospectus describes, Advisors has
agreed to waive a portion of its fee for managing each Fund.

- 18 -
<PAGE> 56

Employees of Advisors and members of their households are limited in
trading for their own accounts. Certain transactions must be reported and
approved, and duplicates of all confirmation statements and other account
reports must be sent to a special compliance unit.

Advisory fees are payable monthly to Advisors. They are calculated as a
percentage of the average value of the net assets each day for each Fund, and
are accrued daily proportionately at 1/365th (1/366th in a leap year) of the
rates set forth in the Prospectus.

State Street Bank and Trust Company ("State Street"), 225 Franklin
Street, Boston, MA 02209 acts as custodian for TIAA-CREF Institutional Mutual
Funds.

Ernst & Young LLP, 787 Seventh Avenue, New York, NY 10019, serves as
independent auditors of TIAA-CREF Institutional Mutual Funds.

In addition to serving as custodian of the Funds' portfolio securities,
State Street provides the Funds with certain administrative services, including
preparation of each Fund's federal, state and local tax returns, preparation of
each Fund's financial information, and various other administrative services.
State Street is compensated by TIAA-CREF Institutional Mutual Funds at the rate
of $________ per year for providing these administrative services. State Street
also acts as the transfer and dividend paying agent for the Funds.

Teachers Insurance and Annuity Association of America ("TIAA") holds
all of the shares of TIAA-CREF Enterprises, Inc., which in turn holds all the
shares of Advisors and of Teachers Personal Investors Services, Inc., the
principal underwriter for TIAA-CREF Institutional Mutual Funds.

ABOUT TIAA-CREF INSTITUTIONAL MUTUAL FUNDS AND THE SHARES

TIAA-CREF Institutional Mutual Funds, was organized as a Delaware
business trust on April 15, 1999. A copy of TIAA-CREF Institutional Mutual
Funds' Certificate of Trust, dated April 15, 1999, as amended, is on file with
the Office of the Secretary of State of the State of Delaware. As a Delaware
business trust, TIAA-CREF Institutional Mutual Funds' operations are governed by
its Declaration of Trust dated April 15, 1999, as amended (the "Declaration").
Upon the initial purchase of shares of beneficial interest in TIAA-CREF
Institutional Mutual Funds, each shareholder agrees to be bound by the
Declaration, as amended from time to time.

INDEMNIFICATION OF SHAREHOLDERS

Generally, Delaware business trust shareholders are not personally
liable for obligations of the Delaware business trust under Delaware law. The
Delaware Business Trust Act ("DBTA") provides that a shareholder of a Delaware
business trust shall be entitled to the same limitation of liability extended to
shareholders of private for-profit corporations. TIAA-CREF Institutional Mutual
Funds' Declaration expressly provides that TIAA-CREF Institutional Mutual Funds
has been organized under the DBTA and that the Declaration is to be governed by
and interpreted in accordance with Delaware law. It is nevertheless possible
that a Delaware

- 19 -
<PAGE> 57

business trust, such as TIAA-CREF Institutional Mutual Funds, might become a
party to an action in another state whose courts refuse to apply Delaware law,
in which case TIAA-CREF Institutional Mutual Funds' shareholders could possibly
be subject to personal liability.

To guard against this risk, the Declaration (i) contains an express
disclaimer of shareholder liability for acts or obligations of TIAA-CREF
Institutional Mutual Funds and provides that notice of such disclaimer may be
given in each agreement, obligation and instrument entered into or executed by
TIAA-CREF Institutional Mutual Funds or its Trustees, (ii) provides for the
indemnification out of Trust property of any shareholders held personally liable
for any obligations of TIAA-CREF Institutional Mutual Funds or any series of
TIAA-CREF Institutional Mutual Funds, and (iii) provides that TIAA-CREF
Institutional Mutual Funds shall, upon request, assume the defense of any claim
made against any shareholder for any act or obligation of TIAA-CREF
Institutional Mutual Funds and satisfy any judgment thereon. Thus, the risk of a
Trust shareholder incurring financial loss beyond his or her investment because
of shareholder liability is limited to circumstances in which all of the
following factors are present: (1) a court refuses to apply Delaware law; (2)
the liability arose under tort law or, if not, no contractual limitation of
liability was in effect; and (3) TIAA-CREF Institutional Mutual Funds itself
would be unable to meet its obligations. In the light of DBTA, the nature of
TIAA-CREF Institutional Mutual Funds' business, and the nature of its assets,
the risk of personal liability to a TIAA-CREF Institutional Mutual Funds
shareholder is remote.

INDEMNIFICATION OF TRUSTEES

The Declaration further provides that TIAA-CREF Institutional Mutual
Funds shall indemnify each of its Trustees and officers against liabilities and
expenses reasonably incurred by them, in connection with, or arising out of, any
action, suit or proceeding, threatened against or otherwise involving such
Trustee or officer, directly or indirectly, by reason of being or having been a
Trustee or officer of TIAA-CREF Institutional Mutual Funds. The Declaration does
not authorize TIAA-CREF Institutional Mutual Funds to indemnify any Trustee or
officer against any liability to which he or she would otherwise be subject by
reason of or for willful misfeasance, bad faith, gross negligence or reckless
disregard of such person's duties.

LIMITATION OF FUND LIABILITY

All persons dealing with a Fund must look solely to the property of
that particular Fund for the enforcement of any claims against that Fund, as
neither the Trustees, officers, agents or shareholders assume any personal
liability for obligations entered into on behalf of a Fund or TIAA-CREF
Institutional Mutual Funds. No Fund is liable for the obligations of any other
Fund. Since the Funds use a combined Prospectus, however, it is possible that
one Fund might become liable for a misstatement or omission in the Prospectus
regarding another Fund with which its disclosure is combined. The Trustees have
considered this factor in approving the use of the combined Prospectus.

SHAREHOLDER MEETINGS AND VOTING RIGHTS

Under the Declaration, TIAA-CREF Institutional Mutual Funds is not
required to hold

- 20 -
<PAGE> 58

annual meetings to elect Trustees or for other purposes. It is not anticipated
that TIAA-CREF Institutional Mutual Funds will hold shareholders' meetings
unless required by law or the Declaration. TIAA-CREF Institutional Mutual Funds
will be required to hold a meeting to elect Trustees to fill any existing
vacancies on the Board if, at any time, fewer than a majority of the Trustees
holding office were elected by the shareholders of TIAA-CREF Institutional
Mutual Funds.

Shares of TIAA-CREF Institutional Mutual Funds do not entitle their
holders to cumulative voting rights, so that the holders of more than 50 percent
of the net asset value represented by the outstanding shares of TIAA-CREF
Institutional Mutual Funds may elect all of the Trustees, in which case the
holders of the remaining shares would not be able to elect any Trustees.
Shareholders are entitled to one vote for each dollar of net asset value (number
of shares held times the net asset value of the applicable Fund).

ADDITIONAL PORTFOLIOS

Pursuant to the Declaration, the Trustees may establish additional
investment portfolios (technically "series" of shares) in TIAA-CREF
Institutional Mutual Funds. The establishment of additional Funds would not
affect the interests of current shareholders in the existing eight Funds. As of
the date of this SAI, the Trustees do not have any plan to establish another
Fund.

DIVIDENDS AND DISTRIBUTIONS

Each share of a Fund is entitled to such dividends and distributions
out of the income earned on the assets belonging to that Fund as are declared in
the discretion of the Trustees. In the event of the liquidation or dissolution
of TIAA-CREF Institutional Mutual Funds as a whole or any individual Fund,
shares of the affected Fund are entitled to receive their proportionate share of
the assets which are attributable to such shares and which are available for
distribution as the Trustees in their sole discretion may determine.
Shareholders are not entitled to any preemptive, conversion, or subscription
rights. All shares, when issued, will be fully paid and non-assessable.

PRICING OF SHARES

The assets of the Funds are valued as of the close of each valuation
day in the following manner:

INVESTMENTS FOR WHICH MARKET QUOTATIONS ARE READILY AVAILABLE

Investments for which market quotations are readily available are
valued at the market value of such investments, determined as follows:

Equity securities listed or traded on a national market or exchange are
valued based on their sale price on such market or exchange at the close of
business (usually 4:00 p.m. Eastern Time) on the date of valuation, or at the
mean of the closing bid and asked prices if no sale is

- 21 -
<PAGE> 59

reported. Such an equity security may also be valued at fair value as determined
in good faith by the Finance Committee of the Board of Trustees if events
materially affecting its value occur between the time its price is determined
and the time a Fund's net asset value is calculated.

FOREIGN INVESTMENTS

Investments traded on a foreign exchange or in foreign markets are
valued at the closing values of such securities as of the date of valuation
under the generally accepted valuation method in the country where traded,
converted to U.S. dollars at the prevailing rates of exchange on the date of
valuation. Since the trading of investments on a foreign exchange or in foreign
markets is normally completed before the end of a valuation day, such valuation
does not take place contemporaneously with the determination of the valuation of
certain other investments held by the Fund. If events materially affecting the
value of foreign investments occur between the time their share price is
determined and the time when a Fund's net asset value is calculated, such
investments will be valued at fair value as determined in good faith by the
Finance Committee of the Board and in accordance with the responsibilities of
the Board as a whole.

DEBT SECURITIES

Debt securities (including money market instruments) for which market
quotations are readily available are valued based on the most recent bid price
or the equivalent quoted yield for such securities (or those of comparable
maturity, quality and type). Values for money market instruments (other than
those in the Institutional Money Market Fund) with maturities of one year or
less will be obtained from either one or more of the major market makers or
derived from a pricing matrix that has various types of money market instruments
along one axis and maturities, ranging from overnight to one year, along the
other. This information is derived from one or more financial information
services. For securities with maturities longer than one year, these values will
be derived utilizing an independent pricing service when such prices are
believed to reflect the fair value of these securities. We use an independent
pricing service to value securities with maturities longer than one year, except
when we believe prices don't accurately reflect the security's fair value.

SPECIAL VALUATION PROCEDURES FOR THE INSTITUTIONAL MONEY MARKET FUND

For the Institutional Money Market Fund, all of its assets are valued
on the basis of amortized cost in an effort to maintain a constant net asset
value per share of $1.00. The Board has determined that such valuation is in the
best interests of the Fund and its shareholders. Under the amortized cost method
of valuation, securities are valued at cost on the date of their acquisition,
and thereafter a constant accretion of any discount or amortization of any
premium to maturity is assumed. While this method provides certainty in
valuation, it may result in periods in which value as determined by amortized
cost is higher or lower than the price the Fund would receive if it sold the
security. During such periods, the quoted yield to investors may differ somewhat
from that obtained by a similar fund which uses available market quotations to
value all of its securities.

The Board has established procedures reasonably designed, taking into
account current

- 22 -
<PAGE> 60

market conditions and the Institutional Money Market Fund's investment
objective, to stabilize the net asset value per share for purposes of sales and
redemptions at $1.00. These procedures include review by the Board, at such
intervals as it deems appropriate, to determine the extent, if any, to which the
net asset value per share calculated by using available market quotations
deviates by more than 1/2 of one percent from $1.00 per share. In the event such
deviation should exceed 1/2 of one percent, the Board will promptly consider
initiating corrective action. If the Board believes that the extent of any
deviation from a $1.00 amortized cost price per share may result in material
dilution or other unfair results to new or existing shareholders, it will take
such steps as it considers appropriate to eliminate or reduce these consequences
to the extent reasonably practicable. Such steps may include: (1) selling
securities prior to maturity; (2) shortening the average maturity of the Fund;
(3) withholding or reducing dividends; or (4) utilizing a net asset value per
share determined from available market quotations. Even if these steps were
taken, the Institutional Money Market Fund's net asset value might still
decline.

OPTIONS AND FUTURES

Portfolio investments underlying options are valued as described above.
Stock options written by a Fund are valued at the last quoted sale price, or at
the closing bid price if no sale is reported for the day of valuation as
determined on the principal exchange on which the option is traded. The value of
a Fund's net assets will be increased or decreased by the difference between the
premiums received on written options and the costs of liquidating such positions
measured by the closing price of the options on the date of valuation.

For example, when a Fund writes a call option, the amount of the
premium is included in the Fund's assets and an equal amount is included in its
liabilities. The liability thereafter is adjusted to the current market value of
the call. Thus, if the current market value of the call exceeds the premium
received, the excess would be unrealized depreciation; conversely, if the
premium exceeds the current market value, such excess would be unrealized
appreciation. If a call expires or if the Fund enters into a closing purchase
transaction, it realizes a gain (or a loss if the cost of the transaction
exceeds the premium received when the call was written) without regard to any
unrealized appreciation or depreciation in the underlying securities, and the
liability related to such call is extinguished. If a call is exercised, the Fund
realizes a gain or loss from the sale of the underlying securities and the
proceeds of the sale increased by the premium originally received.

A premium paid on the purchase of a put will be deducted from a Fund's
assets and an equal amount will be included as an investment and subsequently
adjusted to the current market value of the put. For example, if the current
market value of the put exceeds the premium paid, the excess would be unrealized
appreciation; conversely, if the premium exceeds the current market value, such
excess would be unrealized depreciation.

Stock and bond index futures, and options thereon, which are traded on
commodities exchanges, are valued at their last sale prices as of the close of
such commodities exchanges.

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<PAGE> 61
INVESTMENTS FOR WHICH MARKET QUOTATIONS ARE NOT READILY AVAILABLE

Portfolio securities or other assets for which market quotations are
not readily available will be valued at fair value, as determined in good faith
under the direction of the Trustees.

TAX STATUS

Although TIAA-CREF Institutional Mutual Funds is organized as a
Delaware business trust, neither TIAA-CREF Institutional Mutual Funds nor its
individual Funds will be subject to any corporate excise or franchise tax in the
State of Delaware, nor will they be liable for Delaware income taxes provided
that each Fund qualifies as a regulated investment company for federal income
tax purposes and satisfies certain income source requirements of Delaware law.
If each Fund so qualifies and distributes all of its income and capital gains,
it will also be exempt from applicable New York State taxes and the New York
City general corporation tax, except for small minimum taxes.

Each Fund intends to qualify as a "regulated investment company"
("RIC") under Subchapter M of the Code. In general, to qualify as a RIC: (a) at
least 90 percent of the gross income of a Fund for the taxable year must be
derived from dividends, interest, payments with respect to loans of securities,
gains from the sale or other disposition of securities or foreign currency, or
other income derived with respect to its business of investing in securities;
(b) a Fund must distribute to its shareholders 90 percent of its ordinary income
and net short-term capital gains (undistributed net income may be subject to tax
at the Fund level); and (c) a Fund must diversify its assets so that, at the
close of each quarter of its taxable year, (i) at least 50 percent of the fair
market value of its total (gross) assets is comprised of cash, cash items, U.S.
Government securities, securities of other regulated investment companies and
other securities limited in respect of any one issuer to no more than 5 percent
of the fair market value of the Fund's total assets and 10 percent of the
outstanding voting securities of such issuer and (ii) no more than 25 percent of
the fair market value of its total assets is invested in the securities of any
one issuer (other than U.S. Government securities and securities of other
regulated investment companies) or of two or more issuers controlled by the Fund
and engaged in the same, similar, or related trades or businesses.

If, in any taxable year, a Fund should not qualify as a RIC under the
Code: (1) that Fund would be taxed at normal corporate rates on the entire
amount of its taxable income without deduction for dividends or other
distributions to its shareholders, and (2) that Fund's distributions to the
extent made out of that Fund's current or accumulated earnings and profits would
be taxable to its shareholders (other than tax-exempt shareholders and
shareholders in tax deferred accounts) as ordinary dividends (regardless of
whether they would otherwise have been considered capital gains dividends), and
may qualify for the deduction for dividends received by corporations.

Each Fund must declare and distribute dividends equal to at least 98
percent of its ordinary income (as of the twelve months ended December 31) and
at least 98 percent of its capital gain net income (as of the twelve months
ended October 31), in order to avoid a federal

- 24 -
<PAGE> 62

excise tax. Each Fund intends to make the required distributions, but they
cannot guarantee that they will do so. Dividends attributable to a Fund's
ordinary income and capital gains distributions are taxable as such to
shareholders in the year in which they are received except dividends declared in
October, November or December and paid in January, which dividends are treated
as paid on the prior December 31.

A distribution of net capital gains reflects a Fund's excess of net
long-term capital gains over its net short-term capital losses. Each Fund must
designate income dividends and distributions of net capital gains and must
notify shareholders of these designations within sixty days after the close of
the Fund's taxable year.

Foreign currency gains and losses are taxable as ordinary income. If
the net effect of these transactions is a gain, the dividend paid by the Fund
will be increased; if the result is a loss, the income dividend paid by the Fund
will be decreased. Adjustments to reflect these gains and losses will be made
throughout each Fund's taxable year.

At the time of purchase, each Fund's net asset value may reflect
undistributed income or net capital gains. A subsequent distribution to
shareholders of such amounts, although constituting a return of their
investment, would be taxable either as dividends or capital gain distributions.
For federal income tax purposes, each Fund is permitted to carry forward its net
realized capital losses, if any, for eight years, and realize net capital gains
up to the amount of such losses without being required to pay taxes on, or
distribute such gains. If a shareholder held shares for six months or less and
during that period received a distribution taxable to such shareholder as a long
term capital gain, any loss realized on the sale of such shares during the six
month period would be a long term loss to the extent of such distribution.

Income received by any Fund from sources within various foreign
countries may be subject to foreign income taxes withheld at the source. Under
the Code, if more than 50 percent of the value of a Fund's total assets at the
close of its taxable year consists of securities issued by foreign corporations,
the Fund (e.g., the Institutional International Equity Fund) may file an
election with the Internal Revenue Service to "pass through" to the Fund's
shareholders the amount of any foreign income taxes paid by the Fund. Pursuant
to this election, shareholders will be required to: (i) include in gross income,
even though not actually received, their respective pro rata share of foreign
taxes paid by the Fund; (ii) treat their pro rata share of foreign taxes as paid
by them; and (iii) either deduct their pro rata share of foreign taxes in
computing their taxable income, or use it as a foreign tax credit against U.S.
income taxes (but not both). No deduction for foreign taxes may be claimed by a
shareholder who does not itemize deductions.

Each shareholder will be notified within 60 days after the close of
each taxable year of a Fund, if that Fund will "pass through" foreign taxes paid
for that year, and, if so, the amount of each shareholder's pro rata share (by
country) of (i) the foreign taxes paid, and (ii) the Fund's gross income from
foreign sources. Of course, shareholders who are not liable for federal income
taxes, such as retirement plans qualified under Section 401 of the Code, will
not be able to utilize any such "pass through" of foreign tax credits.

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<PAGE> 63

Each Fund is required by federal law to withhold 31 percent of
reportable payments (which may include income dividends, capital gains
distributions, and share redemption proceeds) paid to shareholders who have not
complied with IRS regulations. In order to avoid this back-up withholding
requirement, a shareholder must certify to the Fund on the application form or
on a separate Internal Revenue Service W-9 Form, that the shareholder's Social
Security Number or Taxpayer Identification Number is correct and that the
shareholder is not currently subject to back-up withholding or is exempt from
back-up withholding.

The foregoing discussion does not address the special tax rules
applicable to certain classes of investors. For example, each shareholder who is
not a U.S. person should consider the U.S. and foreign tax consequences of
ownership of shares of the Funds, including the possibility that such a
shareholder may be subject to a U.S. withholding tax at a rate of 30 percent (or
at a lower rate under an applicable income tax treaty) on Fund distributions
treated as ordinary dividends.

This discussion of the tax treatment of the Funds and their
distributions is based on the federal, Delaware and New York tax laws in effect
as of the date of this SAI. Shareholders should consult their tax advisors to
determine the tax treatment of an investment by him or her in any Fund,
including state and local taxes.

BROKERAGE ALLOCATION

Advisors is responsible for decisions to buy and sell securities for
the Funds as well as for selecting brokers and, where applicable negotiating the
amount of the commission rate paid. It is the intention of Advisors to place
brokerage orders with the objective of obtaining the best execution, which
includes such factors as best price, research and available data. When
purchasing or selling securities traded on the over-the-counter market, Advisors
generally will execute the transactions with a broker engaged in making a market
for such securities. When Advisors deems the purchase or sale of a security to
be in the best interests of a Fund, its personnel may, consistent with their
fiduciary obligations, decide either to buy or to sell a particular security for
the Fund at the same time as for other funds it may be managing, or that may be
managed by its affiliate, TIAA-CREF Investment Management, Inc. ("Investment
Management"), another investment adviser subsidiary of TIAA. In that event,
allocation of the securities purchased or sold, as well as the expenses incurred
in the transaction, will be made in an equitable manner.

Domestic brokerage commissions are negotiated, as there are no standard
rates. All brokerage firms provide the service of execution of the order made;
some brokerage firms also provide research and statistical data, and research
reports on particular companies and industries are customarily provided by
brokerage firms to large investors. In negotiating commissions, consideration is
given by Advisors to the quality of execution provided and to the use and value
of the data. The valuation of such data may be judged with reference to a
particular order or, alternatively, may be judged in terms of its value to the
overall management of the portfolio.

Advisors will place orders with brokers providing useful research and
statistical data

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<PAGE> 64

services if reasonable commissions can be negotiated for the total services
furnished even though lower commissions may be available from brokers not
providing such services. Advisors follows guidelines established by the Board
for the placing of orders with the brokers providing such services.

Research or service obtained for one Fund may be used by Advisors in
managing the other Funds. In such circumstances, the expenses incurred will be
allocated equitably consistent with Advisors' fiduciary duty to the other Funds.

Research or services obtained for TIAA-CREF Institutional Mutual Funds
may be used by personnel of Advisors in managing other investment company
accounts, or by Investment Management for the CREF accounts. In such
circumstances, the expenses incurred will be allocated in an equitable manner
consistent with the fiduciary obligations of personnel of Advisors to TIAA-CREF
Institutional Mutual Funds.

UNDERWRITERS

Teachers Personal Investors Services, Inc. ("TPIS") may be considered
the "principal underwriter" for TIAA-CREF Institutional Mutual Funds. Shares of
TIAA-CREF Institutional Mutual Funds are offered on a continuous basis with no
sales load. Pursuant to a Distribution Agreement with TIAA-CREF Institutional
Mutual Funds, TPIS has the right to distribute shares of TIAA-CREF Institutional
Mutual Funds for the two-year period beginning ________ ___, 1999, and
thereafter from year to year subject to approval by the Funds' Board of
Trustees. TPIS may enter into Selling Agreements with one or more
broker-dealers, which may or may not be affiliated with TPIS, to provide
distribution-related services to TIAA-CREF Institutional Mutual Funds.

CALCULATION OF PERFORMANCE DATA

We may quote a Fund's performance in various ways. All performance
information in advertising is historical and is not intended to indicate future
returns. A Fund's share price, yield, and total return fluctuate in response to
market conditions and other factors, and the value of Fund shares when redeemed
may be more or less than their original cost.

TOTAL RETURN CALCULATIONS

Total returns quoted in advertising reflect all aspects of a Fund's
returns, including the effect of reinvesting dividends and capital gain
distributions, and any change in the Fund's net asset value ("NAV") over a
stated period. Average annual returns are calculated by determining the growth
or decline in value of a hypothetical historical investment in a Fund over a
stated period, and then calculating the annually compounded percentage rate that
would have produced the same result if the rate of growth or decline in value
had been constant over the period according to the following formula:

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<PAGE> 65

n
P (1 + T) = ERV

where: P = the hypothetical initial payment
T = average annual total return
n = number of years in the period
ERV = ending redeemable value of the
hypothetical payment made at the beginning
of the one-, five-, or 10-year period at the
end of the one-, five-, or 10-year period
(or fractional portion thereof).

For example, a cumulative return of 100 percent over ten years would produce an
average annual return of 7.18 percent, which is the steady annual rate that
would equal 100 percent growth on a compounded basis in ten years. While average
annual returns are a convenient means of comparing investment alternatives,
investors should realize that a Fund's performance is not constant over time,
but changes from year to year, and that average annual returns represent
averaged figures as opposed to the actual year-to-year performance of the Fund.

In addition to average annual returns, we may quote a Fund's unaveraged
or cumulative total returns reflecting the actual change in value of an
investment over a stated period. Average annual and cumulative total returns may
be quoted as a percentage or as a dollar amount, and may be calculated for a
single investment, a series of investments, or a series of redemptions, over any
time period. Total returns may be broken down into their components of income
and capital (including capital gains and changes in share price) in order to
illustrate the relationship of these factors and their contributions to total
return. Total returns may be quoted on a before or after tax basis. Total
returns, yields, and other performance information may be quoted numerically or
in a table, graph, or similar illustration.

YIELD CALCULATIONS

All Funds other than the Institutional Money Market Fund. Yields are
computed by dividing the Fund's net investment income for a given 30-day or
one-month period, by the average number of Fund shares, dividing this figure by
the Fund's NAV at the end of the period, and annualizing the result (assuming
compounding of income) in order to arrive at an annual percentage rate. Income
is calculated for purposes of yield quotations in accordance with standardized
methods applicable to all stock and bond funds. In general, interest income is
reduced with respect to bonds trading at a premium over their par value by
subtracting a portion of the premium from income on a daily basis, and is
increased with respect to bonds trading at a discount by adding a portion of the
discount to daily income. For a Fund's investments denominated in foreign
currencies, income and expenses are calculated first in their respective
currencies, and are then converted to U.S. dollars, either when they are
actually converted or at the end of the 30-day or one-month period, whichever is
earlier. Income is adjusted to reflect gains and losses from principal
repayments received by the Fund with respect to mortgage-related securities and
other asset-backed securities. Other capital gains and losses generally are
excluded from the calculation as are gains and losses currently from exchange
rate fluctuations.

Income calculated for the purposes of calculating a Fund's yield
differs from income as

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<PAGE> 66

determined for other accounting purposes. Because of the different accounting
methods used, and because of the compounding of income assumed in yield
calculations, a Fund's yield may not equal its distribution rate, the income
paid to your account, or the income reported in a Fund's financial statements.

Yield information may be useful in reviewing a Fund's performance and
in providing a basis for comparison with other investment alternatives. However,
a Fund's yield fluctuates, unlike investments that pay a fixed interest rate
over a stated period of time. When comparing investment alternatives, investors
should also note the quality and maturity of the portfolio securities of
respective investment companies they have chosen to consider. Investors should
also recognize that in periods of declining interest rates a Fund's yield will
tend to be somewhat higher than prevailing market rates, and in periods of
rising interest rates a Fund's yield will tend to be somewhat lower. Also, when
interest rates are falling, the inflow of net new money to a Fund from the
continuous sale of its shares will likely be invested in instruments producing
lower yields than the balance of the Fund's holdings, thereby reducing the
Fund's current yield. In periods of rising interest rates, the opposite can be
expected to occur.

The Institutional Money Market Fund. Yield quotations for the
Institutional Money Market Fund, including yield quotations based upon the
seven-day period ended on the date of calculation, may also be made available.
These yield quotations are based on a hypothetical pre-existing account with a
balance of one share. In arriving at any such yield quotations, the net change
during the period in the value of that hypothetical account is first determined.
Such net change includes net investment income attributable to portfolio
securities but excludes realized gains and losses from the sale of securities
and unrealized appreciation and depreciation and income other than investment
income (which are included in the calculation of Net Asset Value). For this
purpose, net investment income includes accrued interest on portfolio
securities, plus or minus amortized premiums or purchase discount (including
original issue discount), less all accrued expenses. Such net change is then
divided by the value of that hypothetical account at the beginning of the period
to obtain the base period return, and then the base period return is multiplied
by 365/7 to annualize the current yield figure which is carried to at least the
nearest hundredth of one percent.

The effective yield of the Institutional Money Market Fund for the same
seven-day period may also be disclosed. The effective yield is obtained by
adjusting the current yield to give effect to the compounding nature of the
Fund's investments, and is calculated by the use of the following formula:
365/7
Effective Yield = (Base Period Return + 1) - 1

The Institutional Money Market Fund's yield fluctuates, unlike many
bank deposits or other investments which pay a fixed yield for a stated period
of time. The annualization of one period's income is not necessarily indicative
of future actual yields. Actual yields will depend on such variables as
portfolio quality, average portfolio maturity, the type of instruments held in
the portfolio, changes in interest rates on money market instruments, portfolio
expenses, and other factors.

- 29 -
<PAGE> 67

PERFORMANCE COMPARISONS

Performance information for the Funds, may be compared in
advertisements, sales literature, and reports to shareholders, to the
performance information reported by other investments and to various indices and
averages. Such comparisons may be made with, but are not limited to (1) the S&P
500, (2) the Dow Jones Industrial Average ("DJIA"), (3) Lipper Analytical
Services, Inc. Mutual Fund Performance Analysis Reports and the Lipper General
Equity Funds Average, (4) Money Magazine Fund Watch, (5) Business Week's Mutual
Fund Scoreboard, (6) SEI Funds Evaluation Services Equity Fund Report, (7) CDA
Mutual Funds Performance Review and CDA Growth Mutual Fund Performance Index,
(8) Value Line Composite Average (geometric), (9) Wilshire Associates indices,
(10) Frank Russell Co. Inc. indices, (11) the Consumer Price Index, published by
the U.S. Bureau of Labor Statistics (measurement of inflation), (12)
Morningstar, Inc., (13) the Morgan Stanley Capital International ("MSCI") global
market indices, including the EAFE(R) (Europe, Australasia, Far East) Index, the
EAFE+Canada Index and the International Perspective Index, (14) Lehman Brothers
Aggregate Bond Index, and (15) IBC Money Fund Report Average. We may also
discuss ratings or rankings received from these entities, accompanied in some
cases by an explanation of those ratings or rankings, when applicable. In
addition, advertisements may discuss the performance of the indices listed
above.

The performance of each of the Funds also may be compared to other
indices or averages that measure performance of a pertinent group of securities.
Shareholders should keep in mind that the composition of the investments in the
reported averages will not be identical to that of the Fund and that certain
formula calculations (e.g., yield) may differ from index to index. In addition,
there can be no assurance that any of the Funds will continue its performance as
compared to such indices.

We may also advertise ratings or rankings the Funds receive from
various rating services and organizations, including but not limited to any
organization listed above.

ILLUSTRATING COMPOUNDING

We may illustrate in advertisements, sales literature and reports to
shareholders the effects of compounding of earnings on an investment in a Fund.
We may do this using a hypothetical investment earning a specified rate of
return. To illustrate the effects of compounding, we would show how the total
return from an investment of the same dollar amount, earning the same or a
different rate of return, varies depending on when the investment was made.

NET ASSET VALUE

Charts and graphs using a Fund's NAVs, adjusted NAVs, and benchmark
indices may be used to exhibit performance. An adjusted NAV includes any
distributions paid by the Fund (i.e., assuming reinvestment) and reflects all
elements of its return. Unless otherwise indicated, a Fund's adjusted NAVs are
not adjusted for sales charges, if any. Currently there are no sales charges.

- 30 -
<PAGE> 68

MOVING AVERAGES

We may illustrate a Fund's performance using moving averages. A
long-term moving average is the average of each week's adjusted closing NAV for
a specified period. A short-term moving average is the average of each day's
adjusted closing NAV for a specified period. "Moving Average Activity
Indicators" combine adjusted closing NAVs from the last business day of each
week with moving averages for a specified period to produce indicators showing
when an NAV has crossed, stayed above, or stayed below its moving average.

VOTING RIGHTS

We don't plan to hold annual shareholder meetings. However, we may hold
special meetings to elect trustees, change fundamental policies, approve a
management agreement, or for other purposes. We will mail proxy materials to
shareholders for these meetings, and we encourage shareholders who can't attend
to vote by proxy. The number of votes you have on any matter submitted to
shareholders depends on the dollar value of your investment in the Funds.

LEGAL MATTERS

All matters of applicable state law pertaining to the Funds have been
passed upon by Charles H. Stamm, Executive Vice President and General Counsel of
TIAA and CREF. Legal matters relating to the federal securities laws have been
passed upon by Sutherland Asbill & Brennan LLP of Washington, D.C.

EXPERTS

The financial statements in this Statement of Additional Information
have been audited by Ernst & Young LLP, independent auditors, as stated in their
report appearing herein and have been so included in reliance upon the report of
such firm given upon its authority as experts in accounting and auditing.

ADDITIONAL CONSIDERATIONS

TIAA-CREF Institutional Mutual Funds is part of the TIAA-CREF family of
companies. TIAA, founded in 1918, is a non-profit stock life insurance company.
Its companion organization, CREF, founded in 1952, is a non-profit corporation
registered with the Securities and Exchange Commission as an investment company.
Together, through the issuance of fixed and variable annuity contracts, TIAA and
CREF form the principal retirement system for the nation's education and
research communities and the largest retirement system in the United States
based on assets under management.

Investors should also consider TIAA-CREF Institutional Mutual Funds'
expense charges

- 31 -
<PAGE> 69

as compared to the expenses of other mutual funds. TIAA-CREF Institutional
Mutual Funds' expense charges are currently among the lowest in the industry.

When deciding how to invest in mutual funds, it's important for
investors to determine their investment goals so they can choose the mutual
fund(s) whose objective closely matches it. They should also determine their
time horizon (i.e., the period of time they plan to keep money invested in the
fund). Time horizon affects how much risk an investor may be willing to take.
Risk tolerance in turn affects asset allocation decisions. For example, an
aggressive investor who is willing to accept a high level of risk in return for
potentially greater returns over the long term, probably would invest more
heavily in equity funds. To preserve the current value of an investment and
avoid losses of principal, an investor might invest more heavily in non-equity
funds.

FINANCIAL STATEMENTS

Financial statements for each Fund appear on the following pages.

- 32 -
<PAGE> 70

PART C: OTHER INFORMATION

ITEM 23. EXHIBITS
--------
(a) Declaration of Trust, dated as of April 15, 1999*

(b) Registrant has adopted no bylaws.

(c) The relevant portions of Registrant's certificate of trust and
declaration of trust are incorporated herein by reference to Exhibits
(a)(1) and (2) above.

(d) Investment Management Agreement by and between Registrant and Teachers
Advisors, Inc. ("Advisors"), dated as of __________ ___, 1999**

(e) (1) Distribution Agreement by and between Registrant and Teachers
Personal Investors Services, Inc. ("TPIS"), dated as of
__________ ___, 1999**

(2) Selling Agreement by and between TPIS and TIAA-CREF Individual
& Institutional Services, Inc., dated as of __________ ___,
1999**

(f) Trustees' Long-Term Performance Deferred Compensation Plan, dated as of
__________ ___, 1999**

(g) Custodian Agreement by and between Registrant and State Street Bank and
Trust Company ("State Street"), dated as of __________ ___, 1999
(including schedule of remuneration)**

(h) (1) Administration Agreement by and between Registrant and State
Street, dated as of __________ ___, 1999**

(2) Transfer Agency Agreement by and between Registrant and State
Street, dated as of __________ ___, 1999**

(i) Opinion and Consent of Charles H. Stamm, Esq.**

(j) (1) Consent of Sutherland Asbill & Brennan LLP**

(2) Consent of Ernst & Young LLP**

(k) No required financial statements have been omitted from item 22 in Part
B of this registration statement.

(l) Seed Money Agreement by and between Registrant and Teachers Insurance
and Annuity Association of America, dated as of _________ ___, 1999**

C - 1
<PAGE> 71

(m) No plan has been entered into by Registrant under Rule 12b-1.

(n) Financial Data Schedules**

(o) No plan has been entered into by Registrant under Rule 18f-3.

- ----------------------------------
* Filed herewith.
** To be filed by amendment.

ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND

As the ultimate parent (holding indirectly 100% of the voting
securities of Advisors, investment adviser of Registrant, TIAA may be deemed to
control Registrant (although Registrant does not concede such control). As the
beneficial owner of more than 25% of the voting securities of one or more series
of Registrant's shares (pursuant to the Seed Money Agreement), TIAA controls
Registrant. Therefore, persons directly or indirectly controlled by TIAA may be
deemed to be under common control with Registrant.

<TABLE>
<S> <C>
AIC Properties, Inc. T114 Properties, Inc.
BT Properties, Inc. T-Investment Properties Corp.
College Credit Trust T-Land Corp.
DAN Properties, Inc. T-Las Colinas Towers Corp.
ETC Repackaging, Inc. TCT Holdings, Inc.
Illinois Teachers Properties, LLC Teachers Advisors, Inc.
JV California Two, Inc. Teachers Boca Properties II, Inc.
JV California Three, Inc. Teachers Pennsylvania Realty, Inc.
JV Florida One, Inc. Teachers Personal Investors Services, Inc.
JV Florida Four, Inc. Teachers Properties, Inc.
JV Georgia One, Inc. Teachers REA, LLC
JV Maryland One, Inc. Teachers REA II, Inc.
JV Michigan One, Inc. Teachers REA II, LLC
JV Michigan Two, Inc. Teachers REA III, LLC
JV Michigan Three, Inc. Teachers Realty Corporation
JV Minnesota One, Inc. TEO-NP, LLC
JV North Carolina One, Inc. Tethys Slu, Inc.
JWL Properties, Inc. TIAA Realty, Inc.
Liberty Place Retail, Inc. TIAA Timberlands I, LLC
Macallister Holdings, Inc. TIAA-CREF Enterprises, Inc.
Minnesota Teachers Realty Corp. TIAA-CREF Individual & Institutional
MN Properties, Inc. Services, Inc.
M.O.A. Enterprises, Inc. TIAA-CREF Investment Management, LLC
ND Properties, Inc. TIAA-CREF Life Insurance Company
OWP Hawaii, LLC
Savannah Teachers Properties, Inc. TIAA-CREF Tuition Financing, Inc.
</TABLE>

C - 2
<PAGE> 72

<TABLE>
<S> <C>
TIAA-CREF Trust Company, FSB 730 Properties, Inc.
TIAA-Fund Equities, Inc. 730 Cal Hotel Properties I, Inc.
TPI Housing, Inc. 730 Cal Hotel Properties II, Inc.
Washington Teachers Properties II, Inc. 730 Penn. Hotel Properties I, Inc.
WRC Properties, Inc. 485 Properties, LLC

Subsidiaries of Teachers Properties, Inc.:
Rouse-Teachers Holding Company
Rouse-Teachers Land Holdings, Inc.
</TABLE>

1) All subsidiaries are Delaware corporations except as follows:
A) Pennsylvania non-stock, non-profit corporations:
Liberty Place Retail, Inc.
Teachers Pennsylvania Realty, Inc.
Teachers Realty Corporation
B) Minnesota Teachers Realty Corporation is a Minnesota
corporation.
C) College Credit Trust, a New York Trust
2) All subsidiaries are 100% owned directly by TIAA, except as follows:
A) TIAA-CREF Enterprises, Inc. owns 100% of the stock of Teachers
Advisors, Inc., Teachers Personal Investors Services, Inc.,
TIAA-CREF Life Insurance Company, TIAA-CREF Tuition
Financing, Inc. and TCT Holdings, Inc.
B) TIAA-CREF Trust Company, FSB is 100% owned by TCT Holdings,
Inc.
C) T-Investment Properties Corp. and T-Land Corp. are 100% owned
by Macallister Holdings, Inc.
D) TPI Housing, Inc. is 100% owned by Teachers Properties, Inc.
E) 730 Properties, Inc. owns 100% of the stock of 730 Cal Hotel
Properties I, Inc., 730 Cal Hotel Properties II, Inc. and 730
Penn. Hotel Properties I, Inc.
3) All subsidiaries have as their sole purpose the ownership of
investments which could, pursuant to New York State Insurance Law, be
owned by TIAA itself, except the following:
A) TIAA-CREF Life Insurance Company is a New York State insurance
subsidiary of TIAA, whose stock is owned by TIAA-CREF
Enterprises, Inc.
B) TIAA Realty, Inc. is an investment subsidiary with minority
stockholders and owns commercial real estate.
C) TIAA-CREF Trust Company, FSB is a federally chartered savings
bank.
D) Teachers Advisors, Inc. provides investment advice for the
Registrant.
E) Teachers Personal Investors Services, Inc. provides
broker-dealer services for the Registrant
and TIAA Separate Account VA-1.
F) TIAA-CREF Investment Management, LLC, provides investment
advice for College Retirement Equities Fund.
G) TIAA-CREF Individual & Institutional Services, Inc., which
provides broker-dealer and administrative services for College
Retirement Equities Fund.
H) TCT Holdings, Inc., holds the stock of TIAA-CREF Trust
Company, FSB.

C - 3
<PAGE> 73

ITEM 25. INDEMNIFICATION

As a Delaware business trust, Registrant's operations are governed by
its Declaration of Trust dated as of April 15, 1999 (the "Declaration").
Generally, Delaware business trust shareholders are not personally liable for
obligations of the Delaware business trust under Delaware law. The Delaware
Business Trust Act (the "DBTA") provides that a shareholder of a trust shall be
entitled to the same limitation of liability extended to shareholders of private
for-profit Delaware corporations. Registrant's Declaration expressly provides
that it has been organized under the DBTA and that the Declaration is to be
governed by Delaware law. It is nevertheless possible that a Delaware business
trust, such as Registrant, might become a party to an action in another state
whose courts refuse to apply Delaware law, in which case Registrant's
shareholders could be subject to personal liability.

To protect Registrant's shareholders against the risk of personal
liability, the Declaration (i) contains an express disclaimer of shareholder
liability for acts or obligations of Registrant and provides that notice of such
disclaimer may be given in each agreement, obligation and instrument entered
into or executed by Registrant or its Trustees; (ii) provides for the
indemnification out of Registrant's property of any shareholders held personally
liable for any obligations of Registrant or any series of Registrant; and (iii)
provides that Registrant shall, upon request, assume the defense of any claim
made against any shareholder for any act or obligation of Registrant and satisfy
any judgment thereon. Thus, the risk of a shareholder incurring financial loss
beyond his or her investment because of shareholder liability is limited to
circumstances in which all of the following factors are present: (i) a court
refuses to apply Delaware law; (ii) the liability arose under tort law or, if
not, no contractual limitation of liability was in effect; and (iii) Registrant
itself would be unable to meet its obligations. In the light of Delaware law,
the nature of Registrant's business and the nature of its assets, the risk of
personal liability to a shareholder is remote.

The Declaration further provides that Registrant shall indemnify each
of its Trustees and officers against liabilities and expenses reasonably
incurred by them, in connection with, or arising out of, any action, suit or
proceeding, threatened against or otherwise involving such Trustee or officer,
directly or indirectly, by reason of being or having been a Trustee or officer
of Registrant. The Declaration does not authorize Registrant to indemnify any
Trustee or officer against any liability to which he or she would otherwise be
subject by reason of or for willful misfeasance, bad faith, gross negligence or
reckless disregard of such person's duties.

Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to Trustees, officers and controlling persons, or
otherwise, Registrant has been advised that in the opinion of the Commission
such indemnification may be against public policy as expressed in the Act and
may be, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by Registrant of expenses
incurred or paid by a Trustee, officer or controlling person of Registrant in
the successful defense of any action, suit or proceeding) is asserted by such
Trustee, officer or controlling person in connection with the securities being
registered, Registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed

C - 4
<PAGE> 74

in the Act and will be governed by the final adjudication of such issue.

ITEM 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

Teachers Advisors, Inc. ("Advisors") also provides investment
management service to TIAA Separate Account VA-1. All officers of Advisors are
also officers of TIAA-CREF Investment Management, LLC ("Investment Management")
and are employees of TIAA. John H. Biggs is also a trustee of TIAA, College
Retirement Equities Fund ("CREF"), TIAA-CREF Individual & Institutional
Services, Inc. ("Services") and Investment Management, and a director of
Teachers Personal Investor Services, Inc. ("TPIS"). He is Chief Executive
Officer of TIAA and CREF. Martin L. Leibowitz is a trustee of TIAA, CREF and
Investment Management. He is Vice Chairman and Chief Investment Officer of CREF
and TIAA. Charles H. Stamm is a trustee of Investment Management and Services,
and a director of TPIS. He is General Counsel of CREF and TIAA. Richard J.
Adamski is also Treasurer of TPIS and Services. Richard L. Gibbs is also
Executive Vice President of TPIS and Services. The principal business address of
Investment Management, Services and TPIS is 730 Third Avenue, New York, NY
10017-3206.

Mr. Biggs is also a director of: Ralston Purina Company, Checkerboard
Square, St. Louis, MO 63164; and The Boeing Company, 7755 East Marginal Way
South, Seattle, WA 98108.

ITEM 27. PRINCIPAL UNDERWRITERS

TPIS may be considered the principal underwriter for the Registrant.
The officers of TPIS and their positions and offices with TPIS and the
Registrant are listed in Schedule A of Form BD as currently on file with the
Commission (File No. 8-47051), the text of which is hereby incorporated by
reference.

ITEM 28. LOCATION OF ACCOUNTS AND RECORDS

All accounts, books and other documents required to be maintained by
Section 31(a) of the 1940 Act and the rules promulgated thereunder will be
maintained at the Registrant's home office, 730 Third Avenue, New York, NY
10017-3206, at other offices of the Registrant located at 750 Third Avenue and
485 Lexington Avenue, both in New York, NY 10017-3206, and at the offices of the
Registrant's custodian, State Street Bank and Trust Company, 225 Franklin
Street, Boston, MA 02110. In addition, certain duplicated records are maintained
at Pierce Leahy Archives, 64 Leone Lane, Chester, NY 10918.

ITEM 29. MANAGEMENT SERVICES

State Street Bank and Trust Company, a Massachusetts trust company
("State Street") will provide certain management-related services to the
Registrant pursuant to a Custodian

C - 5
<PAGE> 75

Agreement between the Registrant, State Street and Teachers Advisors, Inc.
("Advisors"), the investment adviser of the Registrant. Under the Custodian
Agreement, State Street will, among other things, act as custodian of the assets
of the portfolios of the Registrant, keep the Registrant's books of account and
compute the net asset value per share of the outstanding shares of each of the
Registrant's portfolios. These services will be rendered pursuant to
instructions received by State Street from Advisors or the Registrant in the
ordinary course of business.

ITEM 30. UNDERTAKINGS

Because registrant does not intend to raise its initial capital under
Section 14(a)(3) of the 1940 Act, no undertaking is required.

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<PAGE> 76

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, TIAA-CREF Institutional Mutual
Funds, has duly caused this registration statement to be signed on its behalf by
the undersigned, duly authorized, in the City of New York, and State of New
York, on the 20th day of April, 1999.

TIAA-CREF INSTITUTIONAL MUTUAL FUNDS

By: /s/ Peter C. Clapman
---------------------------
Name: Peter C. Clapman
Title: President

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Peter C. Clapman 4/20/99
- ----------------------------- ---------
Peter C. Clapman Trustee and President

/s/ Lisa Snow 4/20/99
- ----------------------------- ---------
Lisa Snow Trustee and Secretary
</TABLE>

<PAGE> 77

EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit No. Exhibit Name
- ---------- ------------
<S> <C>
(a) Declaration of Trust, dated as of April 15, 1999
</TABLE>

<PAGE> 1
DECLARATION OF TRUST

TIAA-CREF INSTITUTIONAL MUTUAL FUNDS

<PAGE> 2

<TABLE>
<CAPTION>
TABLE OF CONTENTS

<S> <C>
ARTICLE 1
Name and Definitions...................................................1
1.1. Name.............................................................1
1.2. Definitions......................................................1

ARTICLE 2
Nature and Purpose of Trust............................................2
2.1. Nature of Trust..................................................2
2.2. Purpose of Trust.................................................3
2.3. Interpretation of Declaration of Trust...........................3
2.3.1. Governing Instrument.....................................3
2.3.2. No Waiver of Compliance with Applicable Law..............3
2.3.3. Power of the Trustees Generally..........................3
2.4. Tax Status.......................................................3

ARTICLE 3
Registered Agent; Offices..............................................3
3.1. Registered Agent.................................................3
3.2 Offices..........................................................3

ARTICLE 4
Shares of Beneficial Interest..........................................4
4.1. Shares of Beneficial Interest....................................4
4.2. Number of Authorized Shares......................................4
4.3. Ownership and Certification of Shares............................4
4.4. Status of Shares.................................................4
4.4.1. Fully Paid and Non-Assessable............................4
4.4.2. Personal Property........................................4
4.4.3. Party to Declaration of Trust............................4
4.4.4. Death of Shareholder.....................................4
4.4.5. Title to Trust; Right to Accounting......................5
4.5. Determination of Shareholders....................................5
4.6. Shares Held by Trust.............................................5
4.7. Shares Held by Persons Related to Trust..........................5
4.8. Preemptive and Appraisal Rights..................................5
4.9. Series and Classes of Shares.....................................5
4.9.1. Generally................................................5
4.9.2. Establishment and Designation............................5
4.9.3. Conversion Rights........................................6
4.9.4. Separate and Distinct Nature.............................6
</TABLE>

<PAGE> 3

<TABLE>
<S> <C>
4.9.5. Rights and Preferences of Series.........................6
4.9.5.1. Assets and Liabilities "Belonging" to a Series...6
4.9.5.2. Treatment of Particular Items....................7
4.9.5.3. Limitation on Interseries Liabilities............7
4.9.5.4. Dividends........................................7
4.9.5.5. Redemption by Shareholder........................8
4.9.5.6. Redemption by Trust..............................8
4.9.5.7. Prevention of Personal Holding Company Status....8
4.9.5.8. Net Asset Value..................................8
4.9.5.9. Maintenance of Stable Net Asset Value............9
4.9.5.10. Transfer of Shares..............................9
4.9.5.11. Equality of Shares..............................9
4.9.5.12. Fractional Shares...............................9
4.9.6. Rights and Preferences of Classes........................9

ARTICLE 5
Trustees..............................................................10
5.1. Management of the Trust.........................................10
5.2. Qualification...................................................11
5.3. Number..........................................................11
5.4. Term and Election...............................................11
5.5. Composition of the Board of Trustees............................11
5.6. Resignation and Retirement......................................11
5.7. Removal.........................................................11
5.8. Vacancies.......................................................11
5.9. Ownership of Assets of the Trust................................12
5.10. Powers.........................................................12
5.10.1. By-Laws................................................12
5.10.2. Officers, Agents, and Employees........................12
5.10.3. Committees.............................................12
5.10.3.1. Generally......................................12
5.10.3.2. Executive Committee............................13
5.10.4. Advisers, Administrators, Depositories, and Custodians.13
5.10.5. Compensation...........................................13
5.10.6. Delegation of Authority................................13
5.10.7. Suspension of Sales....................................13
5.11. Certain Additional Powers......................................13
5.11.1. Investments............................................14
5.11.2. Disposition of Assets..................................14
5.11.3. Ownership..............................................14
5.11.4. Subscription...........................................14
5.11.5. Payment of Expenses....................................14
5.11.6. Form of Holding........................................14
</TABLE>

iii

<PAGE> 4

<TABLE>
<S> <C>
5.11.7. Reorganization, Consolidation, or Merger...............14
5.11.8. Compromise.............................................14
5.11.9. Partnerships...........................................15
5.11.10. Borrowing..............................................15
5.11.11. Guarantees.............................................15
5.11.12. Insurance..............................................15
5.11.13. Pensions...............................................15
5.12. Meetings and Vote of Trustees...................................15
5.12.1. Regular Meetings.......................................15
5.12.2. Special Meetings.......................................15
5.12.3. Telephonic Meetings....................................16
5.12.4. Quorum.................................................16
5.12.5. Required Vote..........................................16
5.12.6. Consent in Lieu of a Meeting...........................16

ARTICLE 6
Service Providers.....................................................16
6.1. Investment Adviser..............................................16
6.2. Underwriter and Transfer Agent..................................16
6.3. Custodians......................................................17
6.4. Administrator...................................................17
6.5. Other Contracts.................................................17
6.6. Parties to Contracts............................................17

ARTICLE 7
Shareholders' Voting Powers and Meetings..............................17
7.1. Voting Powers...................................................17
7.1.1. Matters Requiring Shareholders Action...................17
7.1.2. Separate Voting by Series and Class.....................18
7.1.3. Number of Votes.........................................18
7.1.4. Cumulative Voting.......................................18
7.1.5. Voting of Shares; Proxies...............................18
7.1.6. Actions Prior to the Issuance of Shares.................19
7.2. Meetings of Shareholders........................................19
7.2.1. Annual or Other Regular Meetings........................19
7.2.2. Special Meetings........................................19
7.2.3. Notice of Meetings......................................19
7.2.4. Call of Meetings........................................19
7.3. Record Dates....................................................19
7.4. Quorum..........................................................20
7.5. Required Vote...................................................20
7.6. Adjournments....................................................20
7.7. Actions by Written Consent......................................20
</TABLE>

<PAGE> 5

<TABLE>
<S> <C>
7.8. Inspection of Records...........................................20
7.9. Additional Provisions...........................................20

ARTICLE 8
Limitation of Liability and Indemnification...........................20
8.1. General Provisions..............................................20
8.1.1. General Limitation of Liability.........................20
8.1.2. Notice of Limited Liability.............................21
8.1.3. Liability Limited to Assets of the Trust................21
8.2. Liability of Trustees...........................................21
8.2.1. Liability for Own Actions...............................21
8.2.2. Liability for Actions of Others.........................21
8.2.3. Advice of Experts and Reports of Others.................21
8.2.4. Bond....................................................22
8.2.5. Declaration of Trust Governs Issues of Liability........22
8.3. Liability of Third Persons Dealing with Trustees................22
8.4. Liability of Shareholders.......................................22
8.4.1. Limitation of Liability.................................22
8.4.2. Indemnification of Shareholders.........................22
8.5. Indemnification.................................................23
8.5.1. Indemnification of Covered Persons......................23
8.5.2. Exceptions..............................................23
8.5.3. Rights of Indemnification...............................23
8.5.4. Expenses of Indemnification.............................24
8.5.5. Certain Defined Terms Relating to Indemnification.......24

ARTICLE 9
Termination or Reorganization.........................................24
9.1. Termination of Trust, Series, or Class..........................24
9.1.1. Termination.............................................25
9.1.2. Distribution of Assets..................................25
9.1.3. Certificate of Cancellation.............................25
9.2. Reorganization..................................................25
9.3. Merger or Consolidation.........................................25
9.3.1. Authority to Merge or Consolidate.......................25
9.3.2. No Shareholder Approval Required........................26
9.3.3. Subsequent Amendments...................................26
9.3.4. Certificate of Merger or Consolidation..................26

ARTICLE 10
Amendments............................................................26
10.1. Generally......................................................26
10.2. Certificate of Amendment.......................................26
</TABLE>

<PAGE> 6

<TABLE>
<S> <C>
10.3. Prohibited Retrospective Amendments............................26

ARTICLE 11
Miscellaneous Provisions..............................................27
11.1. Certified Copies...............................................27
11.2. Certain Internal References....................................27
11.3. Headings; Counterparts.........................................27
11.4. Resolution of Ambiguities......................................27
11.5. Signatures.....................................................27
11.6. Governing Law..................................................27
11.7. Severability...................................................28
</TABLE>

<PAGE> 7

DECLARATION OF TRUST
OF
TIAA-CREF INSTITUTIONAL MUTUAL FUNDS

This DECLARATION OF TRUST is made as of this 15th day of April 1999, by
the Trustees hereunder.

WHEREAS, the Trustees desire to establish a trust for the purpose of
carrying on the business of an open-end management investment company; and

WHEREAS, in furtherance of such purpose, the Trustees and any successor
Trustees elected in accordance with Article 5 hereof are acquiring and may
hereafter acquire assets which they will hold and manage as trustees of a
Delaware business trust in accordance with the provisions hereinafter set
forth; and

WHEREAS, this Trust is authorized to issue its shares of beneficial
interest in one or more separate series and classes of series, all in
accordance with the provisions set forth in this Declaration of Trust;

NOW, THEREFORE, the Trustees hereby declare that they will hold in trust
all cash, securities, and other assets which they may from time to time acquire
in any manner as Trustees hereunder, and that they will manage and dispose of
the same upon the following terms and conditions for the benefit of the holders
of shares of beneficial interest in this Trust as hereinafter set forth.

ARTICLE 1
NAME AND DEFINITIONS

SECTION 1.1. NAME. This Trust shall be known as the "TIAA-CREF
Institutional Mutual Funds" and the Trustees shall conduct the business of the
Trust under that name or any other name or names as they may from time to time
determine.

SECTION 1.2. DEFINITIONS. Whenever used herein, unless otherwise
required by the context or specifically provided below:

(a) The "Trust" shall mean the Delaware business trust established by
this Declaration of Trust, as amended from time to time;

(b) "Trustee" and "Trustees" shall mean each signatory to this
Declaration of Trust so long as such signatory shall continue in office in
accordance with the terms hereof, and all other individuals who at the time in
question have been duly elected or appointed and qualified in accordance with
Article 5 hereof and are then in office;

<PAGE> 8

(c) "Shares" shall mean the shares of beneficial interest in the Trust
described in Article 4 hereof and shall include fractional and whole Shares;

(d) "Shareholder" shall mean a beneficial owner of Shares, except that
with regard to Shares owned by trusts established in connection with employee
benefit plans, "Shareholder" shall mean the trust;

(e) The "1940 Act" refers to the Investment Company Act of 1940 (and any
successor statute) and the rules and regulations thereunder, all as amended
from time to time;

(f) "Person," "Interested Person," and "Principal Underwriter" shall have
the meanings given them in the 1940 Act;

(g) "Commission" shall mean the United States Securities and Exchange
Commission (or any successor agency thereto);

(h) "Declaration of Trust" or "Declaration" shall mean this Declaration
of Trust as amended or restated from time to time;

(i) "By-Laws" shall mean the By-Laws of the Trust, if any, as amended
from time to time;

(j) "Series" shall mean any of the separate series of Shares established
and designated under or in accordance with the provisions of Article 4 and to
which the Trustees have allocated assets and liabilities of the Trust in
accordance with Article 4;

(k) "DBTA" refers to the Delaware Business Trust Act, Chapter 38 of Title
12 of the Delaware Code (and any successor statute), as amended from time to
time; and

(l) "Code" refers to the Internal Revenue Code of 1986 (and any successor
statute) and the rules and regulations thereunder, all as amended from time to
time.

ARTICLE 2
NATURE AND PURPOSE OF TRUST

SECTION 2.1. NATURE OF TRUST. The Trust is a business trust of the type
referred to in the DBTA. The Trustees shall file a certificate of trust in
accordance with Sections 3810-3812 of the DBTA. The Trust is not intended to
be, shall not be deemed to be, and shall not be treated as, a general or a
limited partnership, joint venture, corporation or joint stock company, nor
shall the Trustees or Shareholders or any of them for any purpose be deemed to
be, or be treated in any way whatsoever as though they were, liable or
responsible hereunder as partners or joint venturers.

<PAGE> 9

SECTION 2.2. PURPOSE OF TRUST. The purpose of the Trust is to engage
in, operate and carry on the business of an open-end management investment
company and to do any and all acts or things as are necessary, convenient,
appropriate, incidental or customary in connection therewith.

SECTION 2.3. INTERPRETATION OF DECLARATION OF TRUST.

SECTION 2.3.1. GOVERNING INSTRUMENT. This Declaration of Trust
shall be the governing instrument of the Trust and shall be governed by and
construed according to the laws of the State of Delaware.

SECTION 2.3.2. NO WAIVER OF COMPLIANCE WITH APPLICABLE LAW. No
provision of this Declaration shall be effective to require a waiver of
compliance with any provision of the Securities Act of 1933, as amended, or the
1940 Act, or of any valid rule, regulation or order of the Commission
thereunder.

SECTION 2.3.3. POWER OF THE TRUSTEES GENERALLY. Except as
otherwise set forth herein, a majority of the Trustees may exercise all powers
of trustees on behalf of the Trust.

SECTION 2.4. TAX STATUS. The Trust intends to qualify as a "regulated
investment company" within the meaning of the Internal Revenue Code of 1986
(and any successor statute) and the rules and regulations thereunder, all as
amended from time to time (the "Code"). To facilitate such qualification, the
Fund intends to elect to be treated as an association taxable as a corporation
under the Code.

ARTICLE 3
REGISTERED AGENT; OFFICES

SECTION 3.1. REGISTERED AGENT. The name of the registered agent of the
Trust is The Corporation Trust Company and the registered agent's business
address in Delaware is Corporation Trust Center, 1209 Orange Street,
Wilmington, Delaware 19801.

SECTION 3.2. OFFICES. The Trust shall maintain an office within the
State of Delaware which shall be identical to the business office of the
registered agent of the Trust as set forth in Section 3.1. The Trustees may,
at any time, establish branch or subordinate offices at any place or places
where the Trust intends to do business.

<PAGE> 10

ARTICLE 4
SHARES OF BENEFICIAL INTEREST

SECTION 4.1. SHARES OF BENEFICIAL INTEREST. The beneficial interests in
the Trust shall be divided into Shares, each of which shall have a par value of
one ten-thousandth of a Dollar ($0.0001). The Trustees shall have the
authority from time to time to divide the Shares into two (2) or more separate
and distinct series of Shares ("Series") and to divide each such Series of
Shares into two (2) or more classes of Shares ("Classes"), all as provided in
Section 4.9 of this Article 4.

SECTION 4.2. NUMBER OF AUTHORIZED SHARES. The Trustees are authorized
to issue an unlimited number of Shares. The Trustees may issue Shares for such
consideration and on such terms as they may determine (or for no consideration
if pursuant to a Share dividend or split), all without action or approval of
the Shareholders.

SECTION 4.3. OWNERSHIP AND CERTIFICATION OF SHARES. The Secretary of
the Trust, or the Trust's transfer or similar agent, shall record the ownership
and transfer of Shares of each Series and Class separately on the record books
of the Trust. The record books of the Trust, as kept by the Secretary of the
Trust or any transfer or similar agent, shall contain the name and address of
and the number of Shares held by each Shareholder, and such record books shall
be conclusive as to who are the holders of Shares and as to the number of
Shares held from time to time by such Shareholders. No certificates certifying
the ownership of Shares shall be issued except as the Trustees may otherwise
determine from time to time. The Trustees may make such rules as they consider
appropriate for the issuance of share certificates, transfer of Shares, and
similar matters for the Trust or any Series or Class.

SECTION 4.4. STATUS OF SHARES.

SECTION 4.4.1. FULLY PAID AND NON-ASSESSABLE. All Shares when
issued on the terms determined by the Trustees shall be fully paid and
non-assessable.

SECTION 4.4.2. PERSONAL PROPERTY. Shares shall be deemed to be
personal property giving only the rights provided in this Declaration of Trust.

SECTION 4.4.3. PARTY TO DECLARATION OF TRUST. Every Person by
virtue of having become [REGISTERED AS] a Shareholder shall be held to have
expressly assented and agreed to the terms of this Declaration of Trust and to
have become a party thereto.

SECTION 4.4.4. DEATH OF SHAREHOLDER. The death of a Shareholder
during the continuance of the Trust shall not operate to terminate the Trust
nor entitle the representative of any deceased Shareholder to an accounting or
to take any action in court or elsewhere against the Trust or the Trustees.
The representative shall be entitled to the same rights as the decedent under
this Trust.

<PAGE> 11

SECTION 4.4.5. TITLE TO TRUST; RIGHT TO ACCOUNTING. Ownership of
Shares shall not entitle the Shareholder to any title in or to the whole or any
part of the Trust property or right to call for a partition or division of the
same or for an accounting.

SECTION 4.5. DETERMINATION OF SHAREHOLDERS. The Trustees may from time
to time close the transfer books or establish record dates and times for the
purposes of determining the Shareholders entitled to be treated as such, to the
extent provided or referred to in Section 7.3.

SECTION 4.6. SHARES HELD BY TRUST. The Trustees may hold as treasury
shares, reissue for such consideration and on such terms as they may determine,
or cancel, at their discretion from time to time, any Shares of any Series or
Class reacquired by the Trust.

SECTION 4.7. SHARES HELD BY PERSONS RELATED TO TRUST. Any Trustee,
officer or other agent of the Trust, and any organization in which any such
person is interested may acquire, own, hold and dispose of Shares of the Trust
to the same extent as if such person were not a Trustee, officer or other agent
of the Trust; and the Trust may issue and sell or cause to be issued and sold
and may purchase Shares from any such person or any such organization subject
only to the general limitations, restrictions or other provisions applicable to
the sale or purchase of such Shares generally.

SECTION 4.8. PREEMPTIVE AND APPRAISAL RIGHTS. Shareholders shall not,
as Shareholders, have any right to acquire, purchase or subscribe for any
Shares or other securities of the Trust which it may hereafter issue or sell,
other than such right, if any, as the Trustees in their discretion may
determine. Shareholders shall have no appraisal rights with respect to their
Shares and, except as otherwise determined by resolution of the Trustees in
their sole discretion, shall have no exchange or conversion rights with respect
to their Shares. No action may be brought by a Shareholder on behalf of the
Trust unless Shareholders owning no less than a majority of the then
outstanding Shares, or Series or Class thereof, join in the bringing of such
action. A Shareholder shall not be entitled to participate in a derivative or
class action lawsuit on behalf of any other Series or any other Class or on
behalf of the Shareholders in any other Series or any other Class of the Trust
than the Series or Class owned by such Shareholder.

SECTION 4.9. SERIES AND CLASSES OF SHARES.

SECTION 4.9.1. GENERALLY. In addition to the Series and Class
established and designated in Section 4.9.2, the Shares of the Trust shall be
divided into one or more separate and distinct Series or Classes of a Series as
the Trustees shall from time to time establish and designate.

SECTION 4.9.2. ESTABLISHMENT AND DESIGNATION. The Trustees shall
have exclusive power without the requirement of Shareholder approval to
establish and designate separate and distinct Series of Shares (each of which
may have a separate investment objective) and, with respect to any Series of
Shares, to establish and designate separate and distinct Classes

<PAGE> 12

of Shares. The establishment and designation of any Series (in addition to
those established and designated in this Section below) or Class shall be
effective upon the execution by a majority of the Trustees of an instrument
setting forth such establishment and designation and the relative rights and
preferences of the Shares of such Series or Class, or as otherwise provided in
such instrument. Each such instrument shall have the status of an amendment to
this Declaration of Trust. Without limiting the authority of the Trustees to
establish and designate any further Series or Classes, the Trustees hereby
establish and designate the following initial Series, the Shares of which shall
all be of one Class:

SECTION 4.9.3. CONVERSION RIGHTS. Subject to compliance with the
requirements of the 1940 Act, the Trustees shall have the authority to provide
that holders of Shares of any Series or Class within a Series shall have the
right to convert such Shares into Shares of one or more other Series or Classes
in accordance with such requirements and procedures as may be established by
the Trustees.

SECTION 4.9.4. SEPARATE AND DISTINCT NATURE. Each Series and
Class, including without limitation any Series and Class specifically
established in Section 4.9.2, shall be separate and distinct from any other
Series and Class. Separate and distinct records shall be maintained for each
Series and Class on the books of the Trust, and the assets belonging to any
such Series and Class shall be held and accounted for separately from the
assets of the Trust or any other Series and Class.

SECTION 4.9.5. RIGHTS AND PREFERENCES OF SERIES. The Trustees
shall have exclusive power without the requirement of Shareholder approval to
fix and determine the relative rights and preferences as between the Shares of
the separate Series. The initial Series and any further Series that may from
time to time be established and designated by the Trustees shall (unless the
Trustees otherwise determine with respect to some further Series at the time of
establishing and designating the same) have relative rights and preferences as
set forth in this Section 4.9.5, subject to the relative rights and preferences
of Classes within each such Series as set forth in Section 4.9.6.

SECTION 4.9.5.1. ASSETS AND LIABILITIES "BELONGING" TO A
SERIES. All consideration received by the Trust for the issue or sale of
Shares of a particular Series, together with all assets in which such
consideration is invested or reinvested, all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of

<PAGE> 13

such assets, and any funds or payments derived from any reinvestment of such
proceeds in whatever form the same may be, shall be held and accounted for
separately from the other assets of the Trust and of every other Series and may
be referred to herein as "assets belonging to" that Series. The assets
belonging to a particular Series shall belong to that Series for all purposes,
and to no other Series, subject only to the rights of creditors of that Series.
Such consideration, assets, income, earnings, profits, and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation of such
assets, and any funds or payments which are not readily identifiable as
belonging to any particular Series (collectively "General Items"), the Trustees
shall allocate to and among any one or more of the Series in such manner and on
such basis as they, in their sole discretion, deem fair and equitable. Any
General Items so allocated to a particular Series shall belong to that Series.
Each such allocation by the Trustees shall be conclusive and binding upon all
Shareholders for all purposes. The assets belonging to each particular Series
shall be charged with the liabilities in respect of that Series and all
expenses, costs, charges and reserves attributable to that Series, and any
general liabilities, expenses, costs, charges or reserves of the Trust which
are not readily identifiable as belonging to any particular Series shall be
allocated and charged by the Trustees to and among any one or more of the
Series established and designated from time to time in such manner and on such
basis as the Trustees in their sole discretion deem fair and equitable. Each
allocation of liabilities, expenses, costs, charges and reserves by the
Trustees shall be conclusive and binding upon all Shareholders for all
purposes.

SECTION 4.9.5.2. TREATMENT OF PARTICULAR ITEMS. The
Trustees shall have full discretion, to the extent consistent with the 1940 Act
and consistent with generally accepted accounting principles, to determine
which items shall be treated as income and which items as capital; and each
such determination and allocation shall be conclusive and binding upon the
Shareholders.

SECTION 4.9.5.3. LIMITATION ON INTERSERIES LIABILITIES.
Subject to the right of the Trustees in their discretion to allocate general
liabilities, expenses, costs, charges or reserves as provided in Section
4.9.5.1, the debts, liabilities, obligations and expenses incurred, contracted
for or otherwise existing with respect to a particular Series shall be
enforceable against the assets of such Series only, and not against the assets
of any other Series. Notice of this limitation on liabilities between and
among Series shall be set forth in the certificate of trust of the Trust
(whether originally or by amendment) as filed or to be filed in the Office of
the Secretary of State of the State of Delaware pursuant to the DBTA, and upon
the giving of such notice in the certificate of trust, the statutory provisions
of Section 3804 of the DBTA relating to limitations on liabilities between and
among series (and the statutory effect under Section 3804 of setting forth such
notice in the certificate of trust) shall become applicable to the Trust and
each Series.

SECTION 4.9.5.4. DIVIDENDS. Dividends and capital gains
distributions on Shares of a particular Series or Class may be paid with such
frequency, in such form, and in such amount as the Trustees may determine by
resolution adopted from time to time, or pursuant to a standing resolution or
resolutions adopted only once or with such frequency as the Trustees may
determine. All dividends and distributions on Shares of a particular Series or
Class thereof shall

<PAGE> 14

be distributed pro rata to the holders of Shares of that Series or Class in
proportion to the number of Shares of that Series or Class held by such holders
at the date and time of record established for the payment of such dividends or
distributions. Such dividends and distributions may be paid in cash, property
or additional Shares of that Series or Class, or a combination thereof, as
determined by the Trustees or pursuant to any program that the Trustees may
have in effect at the time for the election by each Shareholder of the form in
which dividends or distributions are to be paid to that Shareholder. Any such
dividend or distribution paid in Shares shall be paid at the net asset value
thereof as determined in accordance with Section 4.9.5.8.

SECTION 4.9.5.5. REDEMPTION BY SHAREHOLDER. Each
Shareholder shall have the right at such times as may be permitted by the Trust
and as otherwise required by the 1940 Act to require the Trust to redeem all or
any part of such Shareholder's Shares of a Series at a redemption price per
Share equal to the net asset value per Share of such Series next determined in
accordance with Section 4.9.5.8 after the Shares are properly tendered for
redemption, less any charge which may be imposed by the Trust in connection
with such redemption as may be established by the Trustees in their sole
discretion and as described in the Trust's then current prospectus. Payment of
the redemption price shall be in cash; provided, however, that the Trust may,
subject to the requirements of the 1940 Act, make payment wholly or partly in
securities or other assets belonging to the Series of which the Shares being
redeemed are part at the value of such securities or assets used in such
determination of net asset value. Notwithstanding the foregoing, the Trust may
postpone payment of the redemption price and may suspend the right of the
holders of Shares of any Series to require the Trust to redeem Shares of that
Series during any period or at any time when and to the extent permissible
under any applicable provision of the 1940 Act.

SECTION 4.9.5.6. REDEMPTION BY TRUST. The Trustees may
cause the Trust to redeem at net asset value the Shares of any Series held by a
Shareholder upon such conditions as may from time to time be determined by the
Trustees. Upon redemption of Shares pursuant to this Section 4.9.5.6, the
Trust shall promptly cause payment of the full redemption price to be made to
such Shareholder for Shares so redeemed.

SECTION 4.9.5.7. PREVENTION OF PERSONAL HOLDING COMPANY
STATUS. The Trust may reject any purchase order, refuse to transfer any
Shares, and compel the redemption of Shares if, in its opinion, any such
rejection, refusal, or redemption would prevent the Trust from becoming a
personal holding company as defined by the Code.

SECTION 4.9.5.8. NET ASSET VALUE. The net asset value per
Share of any Series, and of any Class thereof, shall be determined in
accordance with the methods and procedures established by the Trustees from
time to time and, to the extent required by applicable law, as disclosed in the
then current prospectus or statement of additional information for the Series
or Class.

<PAGE> 15

SECTION 4.9.5.9. MAINTENANCE OF STABLE NET ASSET VALUE. The
Trustees may determine to maintain the net asset value per Share of any Series
at a designated constant dollar amount and in connection therewith may adopt
procedures not inconsistent with the 1940 Act for the continuing declarations
of income attributable to that Series as dividends payable in additional Shares
of that Series at the designated constant dollar amount and for the handling of
any losses attributable to that Series. Such procedures may provide that in
the event of any loss each Shareholder shall be deemed to have contributed to
the capital of the Trust attributable to that Series his or her pro rata
portion of the total number of Shares required to be canceled in order to
permit the net asset value per Share of that Series to be maintained, after
reflecting such loss, at the designated constant dollar amount. Each
Shareholder of the Trust shall be deemed to have agreed, by his investment in
any Series with respect to which the Trustees shall have adopted any such
procedure, to make the contribution referred to in the preceding sentence in
the event of any such loss. The Trustees may delegate any of their powers and
duties under this Section 4.9.5.9 with respect to appraisal of assets and
liabilities in the determination of net asset value or with respect to a
suspension of the determination of net asset value to an officer or officers or
agent or agents of the Trust designated from time to time by the Trustees.

SECTION 4.9.5.10. TRANSFER OF SHARES. Except to the extent
that applicable law requires otherwise or pursuant to such procedures as may be
developed from time to time by the Trustees or the appropriate officers of the
Trust, Shares shall be transferable on the records of the Trust only by the
record holder thereof or by his agent thereunto duly authorized in writing,
upon delivery to the Trustees or the Trust's transfer agent of a duly executed
instrument of transfer, together with a Share certificate, if one is
outstanding, and such evidence of the genuineness of each such execution and
authorization and of such other matters as may be required by the Trustees.
Upon such delivery the transfer shall be recorded on the register of the Trust.

SECTION 4.9.5.11. EQUALITY OF SHARES. All Shares of each
particular Series shall represent an equal proportionate interest in the assets
belonging to that Series (subject to the liabilities belonging to that Series),
and each Share of any particular Series shall be equal in this respect to each
other Share of that Series. This Section 4.9.5.11. shall not restrict any
distributions otherwise permissible under this Declaration of Trust with
respect to any Classes within a Series.

SECTION 4.9.5.12. FRACTIONAL SHARES. Any fractional Share
of any Series, if any such fractional Share is outstanding, shall carry
proportionately all the rights and obligations of a whole Share of that Series,
including rights and obligations with respect to voting, receipt of dividends
and distributions, redemption of Shares, and liquidation of the Trust or any
Series.

SECTION 4.9.6. RIGHTS AND PREFERENCES OF CLASSES. The Trustees
shall have exclusive power without the requirement of Shareholder approval to
fix and determine the relative rights and preferences as between the separate
Classes within any Series. The initial Class and any further Classes that may
from time to time be established and designated by the Trustees shall

<PAGE> 16

(unless the Trustees otherwise determine with respect to some further Class at
the time of establishing and designating the same) have relative rights and
preferences as set forth in this Section 4.9.6. If a Series is divided into
multiple Classes, the Classes may be invested with one or more other Classes in
the common investment portfolio comprising the Series. Notwithstanding the
provisions of Section 4.9.5, if two or more Classes are invested in a common
investment portfolio, the Shares of each such Class shall be subject to the
following preferences, conversion and other rights, voting powers,
restrictions, conditions of redemption, and, if there are other Classes
invested in a different investment portfolio comprising a different Series,
shall also be subject to the provisions of Section 4.9.5 at the Series level as
if the Classes invested in the common investment portfolio were one Class:

(a) The income and expenses of the Series shall be allocated among the
Classes comprising the Series in such manner as may be determined by the
Trustees in accordance with applicable law;

(b) As more fully set forth in this Section 4.9.6, the liabilities and
expenses of the Classes comprising the Series shall be determined separately
from those of each other and, accordingly, the net asset values, the dividends
and distributions payable to Shareholders, and the amounts distributable in the
event of liquidation of the Trust or termination of a Series to Shareholders
may vary among the Classes comprising the Series. Except for these differences
and certain other differences set forth in this Section 4.9.6 or elsewhere in
this Declaration of Trust, all Shares of the various Classes comprising a
Series shall have the same preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications, and terms
and conditions of redemption.

(c) The dividends and distributions of investment income and capital
gains with respect to the Classes comprising a Series shall be in such amounts
as may be declared from time to time by the Trustees, and such dividends and
distributions may vary among the Classes comprising the Series to reflect
differing allocations of the expenses and liabilities of the Trust among the
Classes and any resultant differences between the net asset values per Share of
the Classes, to such extent and for such purposes as the Trustees may deem
appropriate. The allocation of investment income, capital gains, expenses, and
liabilities of the Trust among the Classes comprising a Series shall be
determined by the Trustees in a manner that is consistent with applicable law.

ARTICLE 5
TRUSTEES

SECTION 5.1. MANAGEMENT OF THE TRUST. The business and affairs of the
Trust shall be managed by the Trustees, and they shall have all powers
necessary and desirable to carry out that responsibility, including those
specifically set forth in Sections 5.10 and 5.11 herein.

<PAGE> 17

SECTION 5.2. QUALIFICATION. Each Trustee shall be a natural person. A
Trustee need not be a Shareholder, a citizen of the United States, or a
resident of the State of Delaware.

SECTION 5.3. NUMBER. By the vote or consent of a majority of the
Trustees then in office, the Trustees may fix the number of Trustees at a
number not less than two (2) nor more than twenty-five (25). No decrease in
the number of Trustees shall have the effect of removing any Trustee from
office prior to the expiration of his or her term, but the number of Trustees
may be decreased in conjunction with the removal of a Trustee pursuant to
Section 5.7.

SECTION 5.4. TERM AND ELECTION. Each Trustee shall hold office until
the next meeting of Shareholders called for the purpose of considering the
election or re-election of such Trustee or of a successor to such Trustee, and
until his or her successor is elected and qualified, and any Trustee who is
appointed by the Trustees in the interim to fill a vacancy as provided
hereunder shall have the same remaining term as that of his or her predecessor,
if any, or such term as the Trustees may determine.

SECTION 5.5. COMPOSITION OF THE BOARD OF TRUSTEES. No election or
appointment of any Trustee shall take effect if such election or appointment
would cause the number of Trustees who are Interested Persons to exceed the
number permitted by Section 10 of the 1940 Act.

SECTION 5.6. RESIGNATION AND RETIREMENT. Any Trustee may resign or
retire as a Trustee (without need for prior or subsequent accounting) by an
instrument in writing signed by such Trustee and delivered or mailed to the
Chairman, if any, the President, or the Secretary of the Trust. Such
resignation or retirement shall be effective upon such delivery, or at a later
date according to the terms of the instrument.

SECTION 5.7. REMOVAL. Any Trustee may be removed with or without cause
at any time: (1) by written instrument signed by two-thirds (2/3) of the number
of Trustees in office prior to such removal, specifying the date upon which
such removal shall become effective, or (2) by the affirmative vote of
Shareholders holding not less than two-thirds (2/3) of Shares outstanding, cast
in person or by proxy at any meeting called for that purpose.

SECTION 5.8. VACANCIES. Any vacancy or anticipated vacancy resulting
for any reason, including without limitation the death, resignation,
retirement, removal, or incapacity of any of the Trustees, or resulting from an
increase in the number of Trustees may (but need not unless required by the
1940 Act) be filled by a majority of the Trustees then in office, subject to
the provisions of Section 16 of the 1940 Act, through the appointment in
writing of such other person as such remaining Trustees in their discretion
shall determine. The appointment shall be effective upon the acceptance of the
person named therein to serve as a Trustee and agreement by such person to be
bound by the provisions of this Declaration of Trust, except that any such
appointment in anticipation of a vacancy occurring by reason of the
resignation, retirement, or increase in number of Trustees to be effective at a
later date shall become effective only at or after the effective date of such
resignation, retirement, or increase in number of Trustees.

<PAGE> 18

SECTION 5.9. OWNERSHIP OF ASSETS OF THE TRUST. The assets of the Trust
shall be held separate and apart from any assets now or hereafter held in any
capacity other than as Trustee hereunder by the Trustees or any successor
Trustees. Legal title to all the Trust property shall be vested in the Trust
as a separate legal entity under the DBTA, except that the Trustees shall have
the power to cause legal title to any Trust property to be held by or in the
name of one or more of the Trustees or in the name of any other Person on
behalf of the Trust on such terms as the Trustees may determine. In the event
that title to any part of the Trust property is vested in one or more Trustees,
the right, title and interest of the Trustees in the Trust property shall vest
automatically in each person who may hereafter become a Trustee upon his or her
due election and qualification. Upon the resignation, removal or death of a
Trustee he or she shall automatically cease to have any right, title or
interest in any of the Trust property, and the right, title and interest of
such Trustee in the Trust property shall vest automatically in the remaining
Trustees. To the extent permitted by law, such vesting and cessation of title
shall be effective whether or not conveyancing documents have been executed and
delivered. No Shareholder shall be deemed to have a severable ownership in any
individual asset of the Trust or any right of partition or possession thereof.

SECTION 5.10. POWERS. Subject to the provisions of this Declaration of
Trust, the business of the Trust shall be managed by the Trustees, and they
shall have all powers necessary or convenient to carry out that responsibility
and the purpose of the Trust including, but not limited to, those enumerated in
this Section 5.10.

SECTION 5.10.1. BY-LAWS. The Trustees may adopt By-Laws not
inconsistent with this Declaration of Trust providing for the conduct of the
business and affairs of the Trust and may amend and repeal them to the extent
that such By-Laws do not reserve that right to the Shareholders.

SECTION 5.10.2. OFFICERS, AGENTS, AND EMPLOYEES. The Trustees
may, as they consider appropriate, elect and remove officers and appoint and
terminate agents and consultants and hire and terminate employees, any one or
more of the foregoing of whom may be a Trustee, and may provide for the
compensation of all of the foregoing.

SECTION 5.10.3. COMMITTEES.

SECTION 5.10.3.1. GENERALLY. The Trustees, by a vote of a
majority of the Trustees then in office, may elect from their number, an Audit
Committee, Executive Committee, Nominating Committee, or any other committee
and may delegate thereto some or all of their powers except those which by law,
by this Declaration of Trust, or by the By-Laws (if any) may not be delegated.
Except as the Trustees may otherwise determine, any such committee may make
rules for the conduct of its business, but unless otherwise provided by the
Trustees or in such rules, its business shall be conducted so far as possible
in the same manner as is provided by this Declaration of Trust or the By-Laws
(if any) for the Trustees themselves. All members of such committees shall
hold such offices at the pleasure of the Trustees. The Trustees may abolish

<PAGE> 19

any committee at any time. Any committee to which the Trustees delegate any of
their powers or duties shall keep records of its meetings and shall report its
actions to the Trustees. The Trustees shall have power to rescind any action
of any committee, but no such rescission shall have retroactive effect.

SECTION 5.10.3.2. EXECUTIVE COMMITTEE. The Executive
Committee, if there shall be one, shall have all of the powers and authority of
the Trustees that may lawfully be exercised by an executive committee, except
the power to: (i) declare dividends or distributions on Shares; (ii) issue
Shares; (iii) recommend to the Shareholders any action which requires the
Shareholders' approval; or (iv) approve any merger, reorganization, or share
exchange which does not require Shareholder approval. Notwithstanding the
foregoing, the Trustees may limit the powers and authority of the Executive
Committee at any time.

SECTION 5.10.4. ADVISERS, ADMINISTRATORS, DEPOSITORIES, AND
CUSTODIANS. The Trustees may, in accordance with Article 6, employ one or more
advisers, administrators, depositories, custodians, and other persons and may
authorize any depository or custodian to employ subcustodians or agents and to
deposit all or any part of such assets in a system or systems for the central
handling of securities and debt instruments, retain transfer, dividend,
accounting or Shareholder servicing agents or any of the foregoing, provide for
the distribution of Shares by the Trust through one or more distributors,
principal underwriters or otherwise, and set record dates or times for the
determination of Shareholders.

SECTION 5.10.5. COMPENSATION. The Trustees may compensate or
provide for the compensation of the Trustees, officers, advisers,
administrators, custodians, other agents, consultants and employees of the
Trust or the Trustees on such terms as they deem appropriate.

SECTION 5.10.6. DELEGATION OF AUTHORITY. In general, the Trustees
may delegate to any officer of the Trust, to any committee of the Trustees and
to any employee, adviser, administrator, distributor, depository, custodian,
transfer and dividend disbursing agent, or any other agent or consultant of the
Trust such authority, powers, functions and duties as they consider desirable
or appropriate for the conduct of the business and affairs of the Trust,
including without implied limitation, the power and authority to act in the
name of the Trust and of the Trustees, to sign documents and to act as
attorney-in-fact for the Trustees.

SECTION 5.10.7. SUSPENSION OF SALES. The Trustees shall have the
authority to suspend or terminate the sales of Shares of any Series or Class at
any time or for such periods as the Trustees may from time to time decide.

SECTION 5.11. CERTAIN ADDITIONAL POWERS. Without limiting the foregoing
and to the extent not inconsistent with the 1940 Act, other applicable law, and
the fundamental policies and limitations of the applicable Series or Class, the
Trustees shall have power and authority for and on behalf of the Trust and each
separate Series or Class as enumerated in this Section 5.11.

<PAGE> 20

SECTION 5.11.1. INVESTMENTS. The Trustees shall have the power to
invest and reinvest cash and other property, and to hold cash or other property
uninvested without in any event being bound or limited by any present or future
law or custom in regard to investments by trustees.

SECTION 5.11.2. DISPOSITION OF ASSETS. The Trustees shall have
the power to sell, exchange, lend, pledge, mortgage, hypothecate, write options
on and lease any or all of the assets of the Trust.

SECTION 5.11.3. OWNERSHIP. The Trustees shall have the power to
vote, give assent, or exercise any rights of ownership with respect to
securities or other property; and to execute and deliver proxies or powers of
attorney to such person or persons as the Trustees shall deem proper, granting
to such person or persons such power and discretion with relation to securities
or other property as the Trustees shall deem proper.

SECTION 5.11.4. SUBSCRIPTION. The Trustees shall have the power
to exercise powers and rights of subscription or otherwise which in any manner
arise out of ownership of securities.

SECTION 5.11.5. PAYMENT OF EXPENSES. The Trustees shall have the
power to pay or cause to be paid all expenses, fees, charges, taxes and
liabilities incurred or arising in connection with the Trust or any Series or
Class thereof, or in connection with the management thereof, including, but not
limited to, the Trustees' compensation and such expenses and charges for the
Trust's officers, employees, investment advisers, administrator, distributor,
principal underwriter, auditor, counsel, depository, custodian, transfer agent,
dividend disbursing agent, accounting agent, shareholder servicing agent, and
such other agents, consultants, and independent contractors and such other
expenses and charges as the Trustees may deem necessary or proper to incur.

SECTION 5.11.6. FORM OF HOLDING. The Trustees shall have the
power to hold any securities or other property in a form not indicating any
trust, whether in bearer, unregistered or other negotiable form, or in the name
of the Trustees or of the Trust or of any Series or in the name of a custodian,
subcustodian or other depositary or a nominee or nominees or otherwise.

SECTION 5.11.7. REORGANIZATION, CONSOLIDATION, OR MERGER. The
Trustees shall have the power to consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or issuer, any
security of which is or was held in the Trust, and to consent to any contract,
lease, mortgage, purchase or sale of property by such corporation or issuer,
and to pay calls or subscriptions with respect to any security held in the
Trust.

SECTION 5.11.8. COMPROMISE. The Trustees shall have the power to
arbitrate or otherwise adjust claims in favor of or against the Trust, any
Series, or Class on any matter in controversy, including but not limited to
claims for taxes.

<PAGE> 21

SECTION 5.11.9. PARTNERSHIPS. The Trustees shall have the power
to enter into joint ventures, general or limited partnerships and any other
combinations or associations.

SECTION 5.11.10. BORROWING. The Trustees shall have the power to
borrow funds and to mortgage and pledge the assets of the Trust or any Series
or any part thereof to secure obligations arising in connection with such
borrowing, consistent with the provisions of the 1940 Act.

SECTION 5.11.11. GUARANTEES. The Trustees shall have the power to
endorse or guarantee the payment of any notes or other obligations of any
person; to make contracts of guaranty or suretyship, or otherwise assume
liability for payment thereof; and to mortgage and pledge the Trust property
(or Series property) or any part thereof to secure any of or all such
obligations.

SECTION 5.11.12. INSURANCE. The Trustees shall have the power to
purchase and pay for entirely out of Trust property such insurance as they may
deem necessary or appropriate for the conduct of the business, including,
without limitation, insurance policies insuring the assets of the Trust and
payment of distributions and principal on its portfolio investments, and
insurance policies insuring the Shareholders, Trustees, officers, employees,
agents, consultants, investment advisers, managers, administrators,
distributors, principal underwriters, or independent contractors, or any
thereof (or any person connected therewith), of the Trust individually against
all claims and liabilities of every nature arising by reason of holding, being
or having held any such office or position, or by reason of any action alleged
to have been taken or omitted by any such person in any such capacity,
including any action taken or omitted that may be determined to constitute
negligence, whether or not the Trust would have the power to indemnify such
person against such liability.

SECTION 5.11.13. PENSIONS. The Trustees shall have the power to
pay pensions for faithful service, as deemed appropriate by the Trustees, and
to adopt, establish and carry out pension, profit-sharing, share bonus, share
purchase, savings, thrift and other retirement, incentive and benefit plans,
including the purchasing of life insurance and annuity contracts as a means of
providing such retirement and other benefits, for any or all of the Trustees,
officers, employees and agents of the Trust.

SECTION 5.12. MEETINGS AND VOTE OF TRUSTEES.

SECTION 5.12.1. REGULAR MEETINGS. The Trustees from time to time
may provide for the holding of regular meetings of the Trustees and fix their
time and place.

SECTION 5.12.2. SPECIAL MEETINGS. Special meetings of the
Trustees may be called by the President of the Trust on twenty-four (24) hours
notice to each Trustee, either personally, by mail, by telegram, or by
facsimile transmission. Special meetings shall be called by the President or
Secretary in like manner and on like notice on the written request of a
majority of

<PAGE> 22

the Trustees then in office or a majority of the members of any executive (or
comparable) committee of the Trustees.

SECTION 5.12.3. TELEPHONIC MEETINGS. Trustees may participate in
a meeting of the Trustees by means of a conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other at the same time. Except to the extent that the
1940 Act has been interpreted otherwise, participation by such means shall
constitute presence in person at the meeting.

SECTION 5.12.4. QUORUM. A majority of the Trustees then in office
being present in person shall constitute a quorum.

SECTION 5.12.5. REQUIRED VOTE. Except as otherwise provided by
the 1940 Act or other applicable law, this Declaration of Trust, or the By-Laws
(if any), any action to be taken by the Trustees on behalf of the Trust or any
Series or Class may be taken by a majority of the Trustees present at a meeting
of Trustees at which a quorum is present.

SECTION 5.12.6. CONSENT IN LIEU OF A MEETING. Except as otherwise
provided by the 1940 Act or other applicable law, the Trustees may, by
unanimous written consent of the Trustees then in office, take any action which
may have been taken at a meeting of the Trustees or any committee thereof.

ARTICLE 6
SERVICE PROVIDERS

SECTION 6.1. INVESTMENT ADVISER. The Trust may enter into written
contracts with one or more persons to act as investment adviser or investment
subadviser to each of the Series, and as such, to perform such functions as the
Trustees may deem reasonable and proper, including, without limitation,
investment advisory, management, research, valuation of assets, clerical and
administrative functions, under such terms and conditions, and for such
compensation, as the Trustees may in their discretion deem advisable.

SECTION 6.2. UNDERWRITER AND TRANSFER AGENT. The Trust may enter into
written contracts with one or more persons to act as principal underwriter or
underwriter or distributor whereby the Trust may either agree to sell Shares to
the other party or parties to the contract or appoint such other party or
parties its sales agent or agents for such Shares and with such other
provisions as the Trustees may deem reasonable and proper, and the Trustees may
in their discretion from time to time enter into transfer agency, dividend
disbursement, and/or shareholder service contract(s), in each case with such
terms and conditions, and providing for such compensation, as the Trustees may
in their discretion deem advisable.

<PAGE> 23

SECTION 6.3. CUSTODIANS. The Trust may enter into written contracts
with one or more persons to act as custodian to perform such functions as the
Trustees may deem reasonable and proper, under such terms and conditions, and
for such compensation, as the Trustees may in their discretion deem advisable.
Each such custodian shall be a bank or trust company having an aggregate
capital, surplus, and undivided profits of at least one million dollars
($1,000,000).

SECTION 6.4. ADMINISTRATOR. The Trust may enter into written contracts
with one or more persons to act as an administrator to perform such functions,
including accounting functions, as the Trustees may deem reasonable and proper,
under such terms and conditions, and for such compensation, as the Trustees may
in their discretion deem advisable.

SECTION 6.5. OTHER CONTRACTS. The Trust may enter into such other
written contracts as the Trustees deem necessary and desirable, including
contracts with one or more persons for the coordination or supervision of
persons providing services to the Trust under one or more of the contracts
described in Sections 6.1, 6.2, 6.3 and 6.4.

SECTION 6.6. PARTIES TO CONTRACTS. Any contract of the character
described in Sections 6.1, 6.2, 6.3, and 6.4 or in Article 8 hereof may be
entered into with any corporation, firm, partnership, trust or association,
including, without limitation, the investment adviser, any investment
subadviser, or any affiliated person of the investment adviser or investment
subadviser, although one or more of the Trustees or officers of the Trust may
be an officer, director, trustee, shareholder, or member of such other party to
the contract, or may otherwise be interested in such contract, and no such
contract shall be invalidated or rendered voidable by reason of the existence
of any such relationship, nor shall any person holding such relationship be
liable merely by reason of such relationship for any loss or expense to the
Trust under or by reason of said contract or be accountable for any profit
realized directly or indirectly therefrom; provided, however, that the contract
when entered into was not inconsistent with the provisions of this Article 6,
Article 8, or the By-Laws (if any). The same person (including a firm,
corporation, partnership, trust or association) may provide more than one of
the services identified in this Article 6.

ARTICLE 7
SHAREHOLDERS' VOTING POWERS AND MEETINGS

SECTION 7.1. VOTING POWERS. The Shareholders shall have power to vote
only with respect to matters expressly enumerated in Section 7.1.1, with
respect to such additional matters relating to the Trust as may be required by
the 1940 Act, this Declaration of Trust, the By-Laws (if any), any registration
of the Trust with the Commission or any state, or as the Trustees may otherwise
deem necessary or desirable.

SECTION 7.1.1. MATTERS REQUIRING SHAREHOLDERS ACTION. Action by
the Shareholders shall be required as to the following matters:

<PAGE> 24

(a) The election or removal of Trustees as provided in Sections 5.4 and
5.7;

(b) The approval to a contract with a third-party provider of services
as to which Shareholder approval is required by the 1940 Act;

(d) The amendment of this Declaration of Trust to the extent and as may
be provided by this Declaration of Trust or applicable law; and

(e) Any court action, proceeding or claim brought or maintained
derivatively or as a class action on behalf of the Trust, any Series or Class
thereof or the Shareholders of the Trust; provided, however, that a Shareholder
of a particular Series or Class shall not be entitled to vote upon a derivative
or class action on behalf of any other Series or Class or Shareholder of any
other Series or Class.

SECTION 7.1.2. SEPARATE VOTING BY SERIES AND CLASS. On any matter
submitted to a vote of the Shareholders, all Shares shall be voted separately
by individual Series, except: (i) when required by the 1940 Act, Shares shall
be voted in the aggregate and not by individual Series or Class thereof; and
(ii) when the Trustees have determined that the matter affects the interests of
more than one Series, then the Shareholders of all such Series shall be
entitled to vote thereon. The Trustees may also determine that a matter
affects only the interests of one or more Classes within a Series, in which
case any such matter shall only be voted on by such Class or Classes.

SECTION 7.1.3. NUMBER OF VOTES. On any matter submitted to a vote
of the Shareholders, each Shareholder shall be entitled to one vote for each
dollar of net asset value standing in such Shareholder's name on the books of
each Series and Class in which such Shareholder owns Shares which are entitled
to vote on the matter.

SECTION 7.1.4. CUMULATIVE VOTING. There shall be no cumulative
voting in the election of Trustees.

SECTION 7.1.5. VOTING OF SHARES; PROXIES. Votes may be cast in
person or by proxy. A proxy with respect to Shares held in the name of two or
more persons shall be valid if executed by any one of them unless at or prior
to exercise of the proxy the Trust receives a specific written notice to the
contrary from any one of them. A proxy purporting to be executed by or on
behalf of a Shareholder shall be deemed valid unless challenged at or prior to
its exercise, and the burden of proving the invalidity of a proxy shall rest on
the challenger. No proxy shall be valid more than eleven months after its
date, unless it provides for a longer period.

<PAGE> 25

SECTION 7.1.6. ACTIONS PRIOR TO THE ISSUANCE OF SHARES. Until
Shares are issued, the Trustees may exercise all rights of Shareholders and may
take any action required by law, this Declaration of Trust, or the By-Laws (if
any) to be taken by Shareholders.

SECTION 7.2. MEETINGS OF SHAREHOLDERS.

SECTION 7.2.1. ANNUAL OR OTHER REGULAR MEETINGS. No annual or
other regular meetings of Shareholders are required to be held.

SECTION 7.2.2. SPECIAL MEETINGS. Special meetings of Shareholders
may be called by the President of the Trust or the Trustees from time to time
for the purpose of taking action upon any matter requiring the vote or
authority of the Shareholders as herein provided or upon any other matter upon
which Shareholder approval is deemed by the Trustees to be necessary or
desirable. A special meeting shall be called by the Secretary of the Trust
upon (i) the request of a majority of the Trustees then in office, or (ii) as
may be required under the 1940 Act.

SECTION 7.2.3. NOTICE OF MEETINGS. Written notice of any meeting
of Shareholders shall be given or caused to be given by the Trustees by mailing
or transmitting such notice not less than ten (10) nor more than ninety (90)
days before such meeting, postage prepaid, stating the time, place and purpose
of the meeting, to each Shareholder at the Shareholder's address as it appears
on the records of the Trust.

SECTION 7.2.4. CALL OF MEETINGS. The Trustees shall promptly call
and give notice of a meeting of Shareholders for the purpose of voting upon
removal of any Trustee of the Trust when requested to do so in writing by
Shareholders holding not less than ten percent (10%) of the Shares of the Trust
then outstanding. For all other matters, the Trustees shall call or give
notice of a meeting within thirty (30) days after written application by
Shareholders entitled to cast at least ten percent (10%) of all of the votes
entitled to be cast on the matter requesting a meeting be called.

SECTION 7.3. RECORD DATES. For the purpose of determining the
Shareholders who are entitled to vote or act at any meeting or any adjournment
thereof, or who are entitled to participate in any dividend or distribution, or
for the purpose of any other action, the Trustees may from time to time close
the transfer books for such period, not exceeding thirty (30) days (except at
or in connection with the termination of the Trust), as the Trustees may
determine; or without closing the transfer books the Trustees may fix a date
and time not more than one hundred twenty (120) days prior to the date of any
meeting of Shareholders or other action as the date and time of record for the
determination of Shareholders entitled to vote at such meeting or any
adjournment thereof or to be treated as Shareholders of record for purposes of
such other action. Any Shareholder who was a Shareholder at the date and time
so fixed shall be entitled to vote at such meeting or any adjournment thereof
or to be treated as a Shareholder of record for purposes of such other action,
even though such Shareholder has since that date and time disposed of its
Shares, and no Shareholder becoming such after that date and time shall be so

<PAGE> 26

entitled to vote at such meeting or any adjournment thereof or to be treated as
a Shareholder of record for purposes of such other action.

SECTION 7.4. QUORUM. Except as otherwise required by the 1940 Act or
other applicable law, this Declaration of Trust, or the By-Laws (if any),
one-tenth (1/10) of the Shares entitled to vote in person or by proxy shall be
a quorum as to any particular matter; provided, however, that any lesser number
shall be sufficient for matters upon which the Shareholders vote at any meeting
called in accordance with Section 7.6.

SECTION 7.5. REQUIRED VOTE. Except as required by applicable law, any
matter upon which the Shareholders vote shall be approved by the affirmative
vote of a majority of the votes cast on such matter at a meeting of the
Shareholders at which a quorum is present, except that Trustees shall be
elected by the affirmative vote of a plurality of the votes cast at such a
meeting.

SECTION 7.6. ADJOURNMENTS. Subject to applicable law, adjourned
meetings may be held within a reasonable time after the date set for the
original meeting without the necessity of further notice.

SECTION 7.7. ACTIONS BY WRITTEN CONSENT. Except as otherwise required
by the 1940 Act or other applicable law, this Declaration of Trust, or the
By-Laws (if any), any action taken by Shareholders may be taken without a
meeting if Shareholders entitled to cast at least a majority of all of the
votes entitled to be cast on the matter (or such larger proportion thereof as
shall be required by the 1940 Act or by any express provision of this
Declaration of Trust or the By-Laws, if any) consent to the action in writing
and such written consents are filed with the records of the meetings of
Shareholders. Such consent shall be treated for all purposes as a vote taken
at a meeting of Shareholders.

SECTION 7.8. INSPECTION OF RECORDS. The records of the Trust shall be
open to inspection by Shareholders to the same extent as is required for
stockholders of a Delaware business corporation under the Delaware General
Corporation Law.

SECTION 7.9. ADDITIONAL PROVISIONS. The By-Laws (if any) may include
further provisions for Shareholders' votes and meetings and related matters not
inconsistent with the provisions hereof.

ARTICLE 8
LIMITATION OF LIABILITY AND INDEMNIFICATION

SECTION 8.1. GENERAL PROVISIONS.

SECTION 8.1.1. GENERAL LIMITATION OF LIABILITY. No personal
liability for any debt or obligation of the Trust shall attach to any Trustee
of the Trust. Without limiting the

<PAGE> 27

foregoing, a Trustee shall not be responsible for or liable in any event for
any neglect or wrongdoing of any officer, agent, employee, investment adviser,
subadviser, principal underwriter or custodian of the Trust, nor shall any
Trustee be responsible or liable for the act or omission of any other Trustee.
Every note, bond, contract, instrument, certificate, Share or undertaking and
every other act or thing whatsoever executed or done by or on behalf of the
Trust or the Trustees or any Trustee in connection with the Trust shall be
conclusively deemed to have been executed or done only in or with respect to
their or his or her capacity as Trustees or Trustee and neither such Trustees
or Trustee nor the Shareholders shall be personally liable thereon.

SECTION 8.1.2. NOTICE OF LIMITED LIABILITY. Every note, bond,
contract, instrument, certificate or undertaking made or issued by the Trustees
or by any officers or officer shall recite that the same was executed or made
by or on behalf of the Trust by them as Trustees or Trustee or as officers or
officer and not individually and that the obligations of such instrument are
not binding upon any of them or the Shareholders individually but are binding
only upon the assets and property of the Trust or belonging to a Series
thereof, and may contain such further recitals as they or he may deem
appropriate, but the omission thereof shall not operate to bind any Trustees or
Trustee or officers or officer or Shareholders or Shareholder individually.

SECTION 8.1.3. LIABILITY LIMITED TO ASSETS OF THE TRUST. All
persons extending credit to, contracting with or having any claim against the
Trust shall look only to the assets of the Trust or belonging to a Series
thereof, as appropriate, for payment under such credit, contract or claim, and
neither the Shareholders nor the Trustees nor any of the Trust's officers,
employees or agents, whether past, present or future, shall be personally
liable therefor.

SECTION 8.2. LIABILITY OF TRUSTEES. The exercise by the Trustees of
their powers and discretion hereunder shall be binding upon the Trust, the
Shareholders, and any other person dealing with the Trust. The liability of
the Trustees, however, shall be limited by this Section 8.2.

SECTION 8.2.1. LIABILITY FOR OWN ACTIONS. A Trustee shall be
liable to the Trust or the Shareholders only for his own willful misfeasance,
bad faith, gross negligence, or reckless disregard of the duties involved in
the conduct of the office of Trustee, and for nothing else, and shall not be
liable for errors of judgment or mistakes of fact or law.

SECTION 8.2.2. LIABILITY FOR ACTIONS OF OTHERS. The Trustees
shall not be responsible or liable in any event for any neglect or wrongdoing
of any officer, agent, employee, consultant, adviser, administrative
distributor, principal underwriter, custodian, transfer agent, dividend
disbursing agent, Shareholder servicing agent, or accounting agent of the
Trust, nor shall any Trustee be responsible for any act or omission of any
other Trustee.

SECTION 8.2.3. ADVICE OF EXPERTS AND REPORTS OF OTHERS. The
Trustees may take advice of counsel or other experts with respect to the
meaning and operation of this Declaration of Trust and their duties as Trustees
hereunder, and shall be under no liability for any act or omission in
accordance with such advice or for failing to follow such advice. In

<PAGE> 28

discharging their duties, the Trustees, when acting in good faith, shall be
entitled to rely upon the books of account of the Trust and upon written
reports made to the Trustees by any officer appointed by them, any independent
public accountant and (with respect to the subject matter of the contract
involved) any officer, partner or responsible employee of any other party to
any contract entered into hereunder.

SECTION 8.2.4. BOND. The Trustees shall not be required to give
any bond as such, nor any surety if a bond is required.

SECTION 8.2.5. DECLARATION OF TRUST GOVERNS ISSUES OF LIABILITY.
The provisions of this Declaration of Trust, to the extent that they restrict
the duties and liabilities of the Trustees otherwise existing at law or in
equity, are agreed by the Shareholders and all other Persons bound by this
Declaration of Trust to replace such other duties and liabilities of the
Trustees.

SECTION 8.3. LIABILITY OF THIRD PERSONS DEALING WITH TRUSTEES. No
person dealing with the Trustees shall be bound to make any inquiry concerning
the validity of any transaction made or to be made by the Trustees or to see to
the application of any payments made or property transferred to the Trust or
upon its order.

SECTION 8.4. LIABILITY OF SHAREHOLDERS. Without limiting the provisions
of this Section 8.4 or the DBTA, the Shareholders shall be entitled to the same
limitation of personal liability extended to stockholders of private
corporations organized for profit under the General Corporation Law of the
State of Delaware.

SECTION 8.4.1. LIMITATION OF LIABILITY. No personal liability for
any debt or obligation of the Trust shall attach to any Shareholder or former
Shareholder of the Trust, and neither the Trustees, nor any officer, employee
or agent of the Trust shall have any power to bind any Shareholder personally
or to call upon any Shareholder for the payment of any sum of money or
assessment whatsoever other than such as the Shareholder may at any time
personally agree to pay by way of subscription for any Shares or otherwise.

SECTION 8.4.2. INDEMNIFICATION OF SHAREHOLDERS. In case any
Shareholder or former Shareholder of the Trust shall be held to be personally
liable solely by reason of being or having been a Shareholder and not because
of such Shareholder's acts or omissions or for some other reason, the
Shareholder or former Shareholder (or, in the case of a natural person, his or
her heirs, executors, administrators or other legal representatives or, in the
case of a corporation or other entity, its corporate or other general
successor) shall be entitled out of the assets of the Trust to be held harmless
from and indemnified against all loss and expense arising from such liability;
provided, however, there shall be no liability or obligation of the Trust
arising hereunder to reimburse any Shareholder for taxes paid by reason of such
Shareholder's ownership of any Shares or for losses suffered by reason of any
changes in value of any Trust assets. The Trust shall, upon request by the
Shareholder or former Shareholder, assume the defense of any claim

<PAGE> 29

made against the Shareholder for any act or obligation of the Trust and satisfy
any judgment thereon.

SECTION 8.5. INDEMNIFICATION.

SECTION 8.5.1. INDEMNIFICATION OF COVERED PERSONS. Subject to the
exceptions and limitations contained in Section 8.5.2, every person who is, or
has been, a Trustee, officer, employee or agent of the Trust, including persons
who serve at the request of the Trust as directors, trustees, officers,
employees or agents of another organization in which the Trust has an interest
as a shareholder, creditor or otherwise (hereinafter referred to as a "Covered
Person"), shall be indemnified by the Trust to the fullest extent permitted by
law against liability and against all expenses reasonably incurred or paid by
him in connection with any claim, action, suit or proceeding in which he
becomes involved as a party or otherwise by virtue of his being or having been
such a Trustee, director, officer, employee or agent and against amounts paid
or incurred by him in settlement thereof.

SECTION 8.5.2. EXCEPTIONS. No indemnification shall be provided
hereunder to a Covered Person:

(a) For any liability to the Trust or its Shareholders arising out of a
final adjudication by the court or other body before which the proceeding was
brought that the Covered Person engaged in willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his office;

(b) With respect to any matter as to which the Covered Person shall have
been finally adjudicated not to have acted in good faith in the reasonable
belief that his or her action was in the best interests of the Trust; or

(c) In the event of a settlement or other disposition not involving a
final adjudication (as provided in paragraph (a) or (b) of this Section 8.5.2)
and resulting in a payment by a Covered Person, unless there has been either a
determination that such Covered Person did not engage in willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of his office by the court or other body approving the settlement or
other disposition, or a reasonable determination, based on a review of readily
available facts (as opposed to a full trial-type inquiry), that he or she did
not engage in such conduct, such determination being made by: (i) a vote of a
majority of the Disinterested Trustees (as such term is defined in Section
8.5.5) acting on the matter (provided that a majority of Disinterested Trustees
then in office act on the matter); or (ii) a written opinion of independent
legal counsel.

SECTION 8.5.3. RIGHTS OF INDEMNIFICATION. The rights of
indemnification herein provided may be insured against by policies maintained
by the Trust, and shall be severable, shall not affect any other rights to
which any Covered Person may now or hereafter be entitled, shall continue as to
a person who has ceased to be a Covered Person, and shall inure to the benefit
of

<PAGE> 30

the heirs, executors and administrators of such a person. Nothing contained
herein shall affect any rights to indemnification to which Trust personnel
other than Covered Persons may be entitled by contract or otherwise under law.

SECTION 8.5.4. EXPENSES OF INDEMNIFICATION. Expenses of
preparation and presentation of a defense to any claim, action, suit or
proceeding subject to a claim for indemnification under this Section 8.5 shall
be advanced by the Trust prior to final disposition thereof upon receipt of an
undertaking by or on behalf of the recipient to repay such amount if it is
ultimately determined that he or she is not entitled to indemnification under
this Section 8.5, provided that either:

(a) Such undertaking is secured by a surety bond or some other
appropriate security or the Trust shall be insured against losses arising out
of any such advances; or

(b) A majority of the Disinterested Trustees acting on the matter
(provided that a majority of the Disinterested Trustees then in office act on
the matter) or independent legal counsel in a written opinion shall determine,
based upon a review of the readily available facts (as opposed to the facts
available upon a full trial), that there is reason to believe that the
recipient ultimately will be found entitled to indemnification.

SECTION 8.5.5. CERTAIN DEFINED TERMS RELATING TO INDEMNIFICATION.
As used in this Section 8.5, the following words shall have the meanings set
forth below:

(a) A "Disinterested Trustee" is one (i) who is not an Interested Person
of the Trust (including anyone, as such Disinterested Trustee, who has been
exempted from being an Interested Person by any rule, regulation or order of
the Commission), and (ii) against whom none of such actions, suits or other
proceedings or another action, suit or other proceeding on the same or similar
grounds is then or has been pending;

(b) "Claim," "action," "suit" or "proceeding" shall apply to all claims,
actions, suits, proceedings (civil, criminal, administrative or other,
including appeals), actual or threatened; and

(c) "Liability" and "expenses" shall include without limitation,
attorneys' fees, costs, judgments, amounts paid in settlement, fines, penalties
and other liabilities.

ARTICLE 9
TERMINATION OR REORGANIZATION

SECTION 9.1. TERMINATION OF TRUST, SERIES, OR CLASS. Unless terminated
as provided herein, the Trust and each Series or Class designated and
established pursuant to this Declaration of Trust shall continue without
limitation of time.

<PAGE> 31

SECTION 9.1.1. TERMINATION. Subject to approval by the affected
Shareholders, the Trust, any Series, or any Class (and the establishment and
designation thereof) may be terminated by an instrument executed by a majority
of the Trustees then in office; provided, however, that no approval of affected
Shareholders is necessary if a majority of the Trustees then in office
determines that the continuation of the Trust, Series, or Class is not in the
best interests of the Trust, such Series, such Class, or the affected
Shareholders as a result of factors or events adversely affecting the ability
of the Trust, Series, or Class to conduct its business and operations in an
economically viable manner.

SECTION 9.1.2. DISTRIBUTION OF ASSETS. Upon termination of the
Trust or any Series or Class, after paying or otherwise providing for all
charges, taxes, expenses and liabilities, whether due or accrued or
anticipated, as may be determined by the Trustees, the Trust shall, in
accordance with such procedures as the Trustees consider appropriate, reduce
the remaining assets of the Trust to distributable form in cash or other
securities, or any combination thereof, and distribute the proceeds to the
affected Shareholders in the manner set forth by resolution of the Trustees.
To the extent permitted by the 1940 Act or other applicable law, the Trustees
may require affected Shareholders to receive Shares of any remaining Series or
Class in lieu of such proceeds.

SECTION 9.1.3. CERTIFICATE OF CANCELLATION. Upon termination of
the Trust, the Trustees shall file a certificate of cancellation in accordance
with Section 3810 of the DBTA.

SECTION 9.2. REORGANIZATION. The Trustees may sell, convey, merge and
transfer the assets of the Trust, or the assets belonging to any one or more
Series, to another trust, partnership, association or corporation organized
under the laws of any state of the United States, or to the Trust to be held as
assets belonging to another Series of the Trust, in exchange for cash, shares
or other securities (including, in the case of a transfer to another Series of
the Trust, Shares corresponding to such other Series) with such transfer either
(i) being made subject to, or with the assumption by the transferee of, the
liabilities belonging to each Series the assets of which are so transferred, or
(ii) not being made subject to, or not with the assumption of, such
liabilities. Following such transfer, the Trustees shall distribute such cash,
Shares or other securities (giving due effect to the assets and liabilities
belonging to and any other differences among the various Series the assets
belonging to which have so been transferred) among the Shareholders of the
Series corresponding to the Series the assets belonging to which have been so
transferred. If all of the assets of the Trust have been so transferred, the
Trust shall be terminated.

SECTION 9.3. MERGER OR CONSOLIDATION.

SECTION 9.3.1. AUTHORITY TO MERGE OR CONSOLIDATE. The Trust, or
any one or more Series, may, either as the successor, survivor, or
non-survivor, (i) consolidate with one or more other trusts, partnerships,
associations or corporations organized under the laws of the State of Delaware
or any other state of the United States to form a new consolidated trust,
partnership, association or corporation under the laws of the State of Delaware
or any other state of the

<PAGE> 32

United States, or have one or more such trusts, partnerships, associations or
corporations merged into it, any such consolidation or merger to be upon such
terms and conditions as are specified in an agreement and plan of
reorganization entered into by the Trust, or one or more Series as the case may
be, in connection therewith. The terms "merge" or "merger" as used herein
shall also include the purchase or acquisition of any assets of any other
trust, partnership, association or corporation which is an investment company
organized under the laws of the State of Delaware or any other state of the
United States.

SECTION 9.3.2. NO SHAREHOLDER APPROVAL REQUIRED. Any such
consolidation or merger shall not require the vote of the Shareholders affected
thereby, unless such vote is required by the 1940 Act or other applicable laws,
or unless such merger or consolidation would result in an amendment of this
Declaration of Trust which would otherwise require the approval of such
Shareholders.

SECTION 9.3.3. SUBSEQUENT AMENDMENTS. In accordance with Section
3815(f) of DBTA, an agreement of merger or consolidation may effect any
amendment to this Declaration of Trust or the By-Laws (if any) or may effect
the adoption of a new declaration of trust or by-laws of the Trust if the Trust
is the surviving or resulting business trust.

SECTION 9.3.4. CERTIFICATE OF MERGER OR CONSOLIDATION. Upon
completion of the merger or consolidation, the Trustees shall file a
certificate of merger or consolidation in accordance with Section 3810 of the
DBTA.

ARTICLE 10
AMENDMENTS

SECTION 10.1. GENERALLY. Except as otherwise specifically provided
herein or as required by the 1940 Act or other applicable law, this Declaration
of Trust may be amended at any time by an instrument in writing signed by a
majority of the Trustees then in office.

SECTION 10.2. CERTIFICATE OF AMENDMENT. In the event of any amendment
to this Declaration of Trust which affects the certificate of trust filed by
the Trust in accordance with Section 2.1, the Trustees shall file a certificate
of amendment in accordance with Section 3810 of the DBTA.

SECTION 10.3. PROHIBITED RETROSPECTIVE AMENDMENTS. No amendment of this
Declaration of Trust or repeal of any of its provisions shall limit or
eliminate the limitation of liability provided to Trustees and officers
hereunder with respect to any act or omission occurring prior to such amendment
or repeal.

ARTICLE 11

<PAGE> 33

MISCELLANEOUS PROVISIONS

SECTION 11.1. CERTIFIED COPIES. The original or a copy of this
Declaration of Trust and of each amendment hereto shall be kept in the office
of the Trust where it may be inspected by any Shareholder. Anyone dealing with
the Trust may rely on a certificate by an officer or Trustee of the Trust as to
whether or not any such amendments have been made and as to any matters in
connection with the Trust hereunder, and with the same effect as if it were the
original, may rely on a copy certified by an officer or Trustee of the Trust to
be a copy of this Declaration of Trust or of any such amendments.

SECTION 11.2. CERTAIN INTERNAL REFERENCES. In this Declaration of Trust
or in any such amendment, references to this Declaration of Trust, and all
expressions like "herein," "hereof" and "hereunder," shall be deemed to refer
to this Declaration of Trust as a whole and as amended or affected by any such
amendment.

SECTION 11.3. HEADINGS; COUNTERPARTS. Headings are placed herein for
convenience of reference only, and in case of any conflict, the text of this
instrument, rather than the headings, shall control. This instrument may be
executed in any number of counterparts, each of which shall be deemed an
original.

SECTION 11.4. RESOLUTION OF AMBIGUITIES. The Trustees may construe any
of the provisions of this Declaration insofar as the same may appear to be
ambiguous or inconsistent with any other provisions hereof, and any such
construction hereof by the Trustees in good faith shall be conclusive as to the
meaning to be given to such provisions. In construing this Declaration, the
presumption shall be in favor of a grant of power to the Trustees.

SECTION 11.5. SIGNATURES. To the extent permitted by applicable law,
any instrument signed pursuant to a validly executed power of attorney shall be
deemed to have been signed by the Trustee or officer executing the power of
attorney.

SECTION 11.6. GOVERNING LAW. This Declaration of Trust is executed and
delivered with reference to DBTA and the laws of the State of Delaware by all
of the Trustees whose signatures appear below, and the rights of all parties
and the validity and construction of every provision hereof shall be subject to
and construed according to DBTA and the laws of the State of Delaware (unless
and to the extent otherwise provided for and/or preempted by the 1940 Act or
other applicable federal securities laws); provided, however, that there shall
not be applicable to the Trust, the Trustees, or this Declaration of Trust (a)
the provisions of Section 3540 of Title 12 of the Delaware Code or (b) any
provisions of the laws (statutory or common) of the State of Delaware (other
than the DBTA) pertaining to trusts which are inconsistent with the rights,
duties, powers, limitations or liabilities of the Trustees set forth or
referenced in this Declaration of Trust. All references to sections of the
DBTA or the 1940 Act, or any rules or regulations thereunder, refer to such
sections, rules, or regulations in effect as of the date of this Declaration of
Trust, or any successor sections, rules, or regulations thereto.

<PAGE> 34

SECTION 11.7. SEVERABILITY. The provisions of this Declaration of Trust
are severable, and if the Trustees shall determine, with the advice of counsel,
that any of such provisions is in conflict with the 1940 Act, the DBTA, or with
other applicable laws and regulations, the conflicting provision shall be
deemed never to have constituted a part of this Declaration of Trust; provided,
however, that such determination shall not affect any of the remaining
provisions of this Declaration of Trust or render invalid or improper any
action taken or omitted prior to such determination. If any provision of this
Declaration of Trust shall be held invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall attach only to such
provision in such jurisdiction and shall not in any manner affect such
provision in any other jurisdiction or any other provision of this Declaration
of Trust in any jurisdiction.

<PAGE> 35

IN WITNESS WHEREOF, the undersigned, being the Trustees of the Trust,
have executed this Declaration of Trust as of the date first written above.

/s/ Peter C. Clapman
---------------------------
Trustee

/s/ Lisa Snow
---------------------------
Trustee